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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
(MARK ONE)
X ANNUAL REPORT PURSUANT TO SECTION 15(D) OF THE
- --- SECURITIES EXCHANGE ACT OF 1934
FOR THE PERIOD FROM INCEPTION NOVEMBER 1, 1994 TO DECEMBER 31, 1994
OR
___ TRANSITION REPORT PURSUANT TO SECTION 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ________ TO ________
COMMISSION FILE NUMBER: _________
THE LINCOLN ELECTRIC COMPANY
EMPLOYEE SAVINGS PLAN
(FULL TITLE OF THE PLAN AND THE ADDRESS OF THE PLAN,
IF DIFFERENT FROM THAT OF ISSUER NAMED BELOW)
THE LINCOLN ELECTRIC COMPANY, 22801 ST. CLAIR AVENUE,
CLEVELAND, OHIO 44117-1199
(NAME OF ISSUER OF THE SECURITIES HELD PURSUANT TO
THE PLAN AND THE ADDRESS OF ITS PRINCIPAL EXECUTIVE OFFICE)
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THE LINCOLN ELECTRIC COMPANY
EMPLOYEE SAVINGS PLAN ("Plan")
Audited financial statements and schedules for the Plan
prepared in accordance with the financial reporting
requirements of the Employee Retirement Income Security Act of
1974, as amended, are filed herewith in lieu of an audited
statement of financial condition and statement of income and
changes in plan equity.
<TABLE>
<CAPTION>
Financial Statements: Page
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<S> <C>
Report of Independent Auditors 4
Statements of Net Assets Available for Benefits, With Fund
Information 5
December 31, 1994
Statements of Changes in Net Assets Available for Benefits,
With Fund Information 6
For the Period From Inception (November 1, 1994)
to December 31, 1994
Notes to Financial Statements 7
Schedules:
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Item 27a -- Schedule of Assets Held for Investment Purposes 10
December 31, 1994
Item 27d -- Schedule of Reportable Transactions 11
For the Period From Inception (November 1, 1994)
to December 31, 1994
All other schedules are omitted as not applicable or not required.
Exhibit
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Exhibit No. 23 - Consent of Ernst & Young LLP, Independent Auditors,
is incorporated by reference to Exhibit 23(a) to The Lincoln Electric
Company's Registration Statement on Form S-8 relating to the Plan.
</TABLE>
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SIGNATURES
THE PLAN. Pursuant to the requirements of the Securities
Exchange Act of 1934, the trustees (or other persons who administer the
employee benefit plan) have duly caused this annual report to be signed on
their behalf by the undersigned hereunto duly authorized.
THE LINCOLN ELECTRIC COMPANY
EMPLOYEE SAVINGS PLAN
By The Lincoln Electric Company,
Plan Administrator
Date: November 13, 1995 By /s/ Frederick G. Stueber
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Name: Frederick G. Stueber
Title: Vice President, General
Counsel and Secretary
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EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description of Exhibit
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<S> <C>
23 Consent of Ernst & Young LLP, Independent Auditors,
is incorporated by reference to Exhibit 23(a) to The
Lincoln Electric Company's Registration Statement on
Form S-8 relating to the Plan.
</TABLE>
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Report of Independent Auditors
Plan Administrator
The Lincoln Electric Company
Employee Savings Plan
We have audited the accompanying statement of net assets available for
benefits, with Fund Information (modified cash basis) of The Lincoln Electric
Company Employee Savings Plan as of December 31, 1994, and the related
statement of changes in net assets available for benefits, with Fund
Information (modified cash basis) for the period from date of inception
(November 1, 1994) to December 31, 1994. These financial statements are the
responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
As described in Note A, the financial statements referred to above were
prepared on a modified cash basis of accounting, which is a comprehensive basis
of accounting other than generally accepted accounting principles.
In our opinion, the financial statements referred to above present fairiy, in
all material respects, the net assets available for benefits (modified cash
basis) of The Lincoln Electric Company Employee Savings Plan at December 31,
1994, and the changes in its net assets available for benefits (modified cash
basis) for the period from date of inception (November 1, 1994) to December
31, 1994, on the basis of accounting described in Note A.
Our audit was performed for the purpose of forming an opinion on the financial
statements taken as a whole. The accompanying supplemental schedules (modified
cash basis) of assets held for investment purposes as of December 31, 1994 and
reportable transactions for the period from date of inception (November 1,
1994) to December 31, 1994, are presented for purposes of complying with the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974, and are not a required
part of the financial statements. The Fund Information in the Statement of Net
Assets Available for Benefits and the Statement of Changes in Net Assets
Available for Benefits is presented for purposes of additional analysis rather
than to present the Net Assets Available for Benefits and Changes in Net Assets
Available for Benefits of each fund. The supplemental schedules and Fund
Information (modified cash basis) have been subjected to the auditing
procedures applied in our audit of the 1994 financial statements and, in our
opinion, are fairiy stated in all material respects in relation to the 1994
financial statements taken as a whole.
ERNST & YOUNG LLP
November 8, 1995
Cleveland, Ohio
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The Lincoln Electric Company
Employee Savings Plan
Statement of Net Assets Available for Benefits, With Fund Information
December 31, 1994
<TABLE>
<CAPTION>
Fidelity
Advisors
Victory Fidelity Equity
U.S. Treasury Advisors Victory Portfolio
Money Society EB Income & Stock Index Growth Templeton
Market Fund MaGIC Fund Growth Fund Fund Fund Foreign Fund Total
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<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Investments:
Mutual funds $662,675 $685,767 $356,900 $1,030,436 $1,273,493 $4,009,271
Money market fund $417,252 417,252
Investment income
receivable 1,626 736 875 454 1,306 7,239 12,236
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418,878 663,411 686,642 357,354 1,031,742 1,280,732 4,438,759
LIABILITIES
Accrued purchase of
investments 45 193 5,617 5,855
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Net assets avallable
for benefits $418,833 $663,218 $686,642 $357,354 $1,031,742 $1,275,115 $4,432,904
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</TABLE>
See notes to financial statements.
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<TABLE>
The Lincoln Electric Company
Employee Savings Plan
Statement of Changes in Net Assets Available for Benefits, with Fund Information
For Period from Inception (November 1, 1994) to December 31, 1994
<CAPTION>
Fidelity
Advisors
Victory Fidelity Equity
U.S. Treasury Advisors Victory Portfolio
Money Society EB Income & Stock Index Growth Templeton
Market Fund MaGIC Fund Growth Fund Fund Fund Foreign Fund Total
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<S> <C> <C> <C> <C> <C> <C> <C>
ADDITIONS
Contributions--
Employees $417,252 $660,140 $683,844 $348,143 $991,002 $1,271,494 $4,371,875
Investment income 1,581 543 875 2,986 4,123 7,239 17,347
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Total additions 418,833 660,683 684,719 351,129 995,125 1,278,733 4,389,222
Net realized and unrealized
appreciation
(depreciation) of
investments 2,535 1,924 6,226 36,617 (3,620) 43,682
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Net additions 418,833 663,218 686,643 357,355 1,031,742 1,275,113 4,432,904
Net assets available
for benefits at
November 1, 1994 - - - - - - -
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NET ASSETS AVAILABLE FOR BENEFITS
AT DECEMBER 31, 1994 $418,833 $663,218 $686,643 $357,355 $1,031,742 $1,275,113 $4,432,904
===========================================================================================================
</TABLE>
See notes to financial statements.
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The Lincoln Electric Company Employee Savings Plan
Notes to Financial Statements
December 31, 1994
A. SIGNIFICANT ACCOUNTING POLICIES
The accounting records of The Lincoln Electric Company Employee Savings Plan
(the Plan) are maintained on the modified cash basis of accounting. Employee
contributions are recorded when received by Society National Bank (the
Trustee), whereas investment income and plan liabilities are recorded when
incurred.
Investment assets of each fund are stated at market value on the last business
day of the year as determined by the Trustee.
B. DESCRIPTION OF THE PLAN
The Lincoln Electric Company (the Company) established the Plan which became
effective November 1, 1994, to cover certain employees of the Company as
defined by the Plan. The Plan provides that employees will be eligible for
membership in the Plan following one year of service with the Company.
Eligible employees may make before-tax contributions to the Plan of 1% or more
of their regular and/or bonus pay up to the maximum amount as set by the
Internal Revenue Service ($9,240 in 1994). Employee contributions are fully
vested when made. A participant for whose account a contribution is made shall
have the right to direct the Trustee to invest such contribution, in any one
fund or in a combination of funds in 5% increments. The investment options
are as follows:
<TABLE>
<CAPTION>
Fund Description Sponsor
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<S> <C> <C>
Pooled Separate Accounts:
Victory U.S. Treasury Money Market Victory Broker Dealer Services
Money Market Fund
Society EB MaGIC Fund Guaranteed Investment Society National Bank
Contracts
Fidelity Advisors Income Growth Stocks Fidelity Investment Co.
and Growth Fund
Victory Stock Index Fund S&P 500 Index Victory Broker Dealer Services
Fidelity Advisors Equity Preferred and Common Fidelity Investment Co.
Portfolio Fund Stocks
Templeton Foreign Fund International Fund Templeton Investment Co.
</TABLE>
The Company, at its discretion, may make a matching contribution,
profit sharing contribution or qualified nonelective contribution for any plan
year to be made in cash or Company stock. No Company contributions were made
for 1994.
The Company has elected to pay certain administrative costs of the Plan in
1994. Party-in-interest transactions included the investment in the special
funds of the trustee and the payment of administrative expenses. Such
transactions are exempt from being prohibited transactions.
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The Lincoln Electric Company Employee Savings Plan
Notes to Financial Statements--Continued
B. DESCRIPTION OF THE PLAN---CONTINUED
Participants may receive the value of their account in a single sum payment or
in ten or fewer annual installment payments following separation from the
Company, whether by retirement, disability or otherwise except that if the full
value of a participants account is $3,500 or less, or if the participant dies
and his/her account is payable to his/her beneficiary, such account balance
will be paid in a single sum payment. If the value of a participants account is
more than $3,500 the participant may elect to defer the payment of his/her
account until they reach age 60. Participants who leave the Company may
withdraw their money at anytime. Withdrawal must begin when the participants
attain the age of 70 1/2. Borrowings are permitted from a participants vested
account subject to the limitations of the Plan.
The Company may amend, modify, suspend or terminate the Plan. No amendment,
modification, suspension or termination of the Plan shall have the effect of
providing that any amounts then held under the Plan may be used or diverted to
any purpose other than for the exclusive benefit of the participants or their
beneficiaries.
Information about the Plan is contained in the Plan Document, which is
available from the Human Resources Department upon request.
C. INVESTMENTS
The Trustee of the Plan holds the Plan's investment assets and executes
transactions.
The fair value of individual investments that represent 5% or more of the
Plan's net assets available for plan benefits at December 31, 1994 are as
follows:
<TABLE>
<S> <C>
Victory U.S. Treasury Money Market Fund $417,252
Society EB MaGIC Fund 662,675
Fidelity Advisors Income & Growth Fund 685,767
Victory Stock Index Fund 356,900
Fidelity Advisors Equity Portfolio Growth Fund 1,030,436
Templeton Foreign Fund 1,273,493
</TABLE>
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The Lincoln Electric Company Employee Savings Plan
Notes to Financial Statements--Continued
D. INCOME TAX STATUS
The Company has requested a determination from the Internal Revenue Service
(IRS) as to whether the Plan qualifies under the Internal Revenue Code (IRC)
and would therefore not be subject to tax under present income tax law. The
Company believes that such determination, when received, will be favorable.
Once qualified, the Plan is required to operate in conformity with the IRC in
order to maintain its qualification. The Company is not aware of any course of
action or series of events which have occurred that might adversely affect the
Plan's status. The tax exempt status of the Plan would not apply to the
taxability of distributions to participants under the Plan.
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The Lincoln Electric Company Employee Savings Plan
Form 5500, Item 27(a)--Schedule of Assets Held for Investment Purposes
December 31, 1994
<TABLE>
<CAPTION>
Description of Current
Identity of Issue Investment Cost Value
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<S> <C> <C> <C>
Victory U.S. Treasury Money Market Fund 417,252.380 units $417,252 $417,252
Society EB MaGIC Fund 65,484.348 units 660,140 662,675
Fidelity Advisors Income & Growth Fund 47,755,358 units 683,844 685,767
Victory Stock Index Fund 36,086.944 units 350,675 356,900
Fidelity Advisors Equity Portfolio Growth
Fund 36,334.124 units 1,001,212 1,030,436
Templeton Foreign Fund 144,386.908 units 1,284,133 1,273,493
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$4,397,256 $4,426,523
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</TABLE>
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The Lincoln Electric Company Employee Savings Plan
Form 5500, Item 27(d)--Schedule of Reportable Transactions
For Period from Inception (November 1, 1994) to December 31, 1994
<TABLE>
<CAPTION>
Net
Purchase Selling Cost of Current Gain
Description of Asset Price Price Asset Value (Loss)
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<S> <C> <C> <C> <C> <C>
CATEGORY (III)--SERIES OF TRANSACTIONS IN EXCESS OF 5% OF PLAN ASSETS
Employee Benefits Money
Market Fund $3,704,459 $3,704,459 $3,704,459
$3,704,459 3,704,459 3,704,459
Society EB MaGIc Fund 660,140 660,140 660,140
Fidelity Advisors Income &
Growth Fund 683,844 683,844 683,844
Victory Stock Index Fund 350,675 350,675 350,675
Fidelity Advisors Equity Portfolio
Growth Fund 993,819 993,819 993,819
Templeton Foreign Fund 1,277,112 1,277,112 1,277,112
</TABLE>
There were no category (i), (ii), or (iv) reportable transactions during the
period from date of inception (November 1, 1994) to December 31, 1994.
11
