LINCOLN ELECTRIC CO, 10-K, 1995-03-31

LINCOLN ELECTRIC CO
10-K, 1995-03-31
METALWORKG MACHINERY & EQUIPMENT

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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

FOR THE YEAR ENDED DECEMBER 31, 1994 COMMISSION FILE NUMBER 0-1402

THE LINCOLN ELECTRIC COMPANY
----------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

OHIO
------------------------------------------
(State or other jurisdiction of
incorporation or organization)

34-0359955
------------------------------------------
(I.R.S. Employer
Identification No.)

22801 St. Clair Ave., Cleveland, Ohio
------------------------------------------
(Address of principal executive offices)

44117
------------------------------------------
(Zip Code)

(216) 481-8100 (Registrant's telephone number including area code)

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:
Common Shares, without par value

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that registrant
was required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
--- ---

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]

The aggregate market value of the voting common stock held by
non-affiliates as of February 15, 1995 was $131,480,925. (Affiliates, for this
purpose, have been deemed to be Directors of the Company, certain significant
shareholders and employees participating in the Employees' Stock Purchase Plan
and Employee Stock Ownership Plan).

The number of shares outstanding of the issuer's classes of common stock as
of February 15, 1995 was as follows:

<TABLE>
<S> <C>
Common Stock, without par value 10,514,324
Class A Common Stock, without par value 499,840
----------
Total outstanding shares 11,014,164
==========
</TABLE>

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrant's proxy statement for the annual meeting of
shareholders to be held on May 23, 1995 are hereby incorporated by reference
into Part III.
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<PAGE> 2

PART I

Item 1. BUSINESS

As used in Item 1 of this report, the term "Company", except as otherwise
indicated by the context, means The Lincoln Electric Company and its
subsidiaries. The Lincoln Electric Company was incorporated under the laws of
the State of Ohio in 1906. The Company is a full-line manufacturer of welding
products and integral horsepower industrial electric motors. Welding products
include arc welding machines, power sources, automated wire feeding systems and
arc welding consumable electrodes. The Company also sells industrial gases,
regulators and torches used in oxy-fuel welding and cutting. Sales of arc
welding and other welding products accounted for 93% of the Company's net sales
in 1994.

The arc welding machines, power sources and automated wire feeding systems
manufactured by the Company range in technology from basic units used for light
manufacturing and maintenance to highly sophisticated machines for robotic
applications, high production welding and fabrication. Three primary types of
arc welding electrodes are produced: (1) coated manual or stick electrodes, (2)
solid electrodes produced in coil form for continuous feeding in mechanized
welding, and (3) cored electrodes produced in coil form for continuous feeding
in mechanized welding. The integral horsepower electric motors manufactured by
the Company range in size from 1/3 to 1,250 horsepower.

The Company's products are sold in both domestic and international markets.
In the domestic market, they are sold directly by the Company's own sales
organization as well as by distributors. In the international markets, the
Company's products are sold principally by foreign subsidiary companies. The
Company also has an international sales organization comprised of international
direct sales distributors, agents and dealers that operate in more than
eighty-six countries. The Company has manufacturing facilities located in the
United States, Australia, Canada, Mexico, England, France, Ireland, Italy, The
Netherlands, Norway and Spain. See Note G to the consolidated financial
statements with respect to geographic area information.

The Company is not dependent on a single customer or a few customers. The
loss of any one customer would not have a material adverse effect on its
business. The Company's business is not seasonal.

Conditions in the arc welding industry are highly competitive. The Company
believes that it is one of the largest manufacturers of consumables and
machinery in a field of three or four major domestic competitors and numerous
smaller competitors covering the industry. The Company continues to pursue
strategies to heighten its competitiveness in international markets. Competition
in the electric arc welding industry is on the basis of price, brand preference,
product quality and performance, warranty, delivery, service and technical
support. All of these factors have contributed to the Company's position as one
of the leaders in the industry.

Virtually all of the Company's products may be classified as standard
commercial articles and are manufactured for stock. The Company believes its
products are unique because of its highly trained technical sales force and the
support of its welding research and development staff which allow it to uniquely
assist the consumers of its products in solving their welding application
problems. The Company utilizes this technical expertise to present its
Guaranteed Cost Reduction Program to end users in which the Company guarantees
that the user will save money in its manufacturing process when it utilizes the
Company's products. This allows the Company to introduce its products to new
users and to establish and maintain very close relationships with the consumers.
This close relationship between the technical sales force and the direct
consumers, together with its supportive relationship with its distributors, who
are particularly interested in handling the broad breadth of the Company's
products, is an important element of the Company's market success and a valuable
asset of the Company.

The principal raw materials essential to the Company's business are various
chemicals, steel, copper and aluminum, all of which are normally available for
purchase in the open market.

The Company's operations are not materially dependent upon patents,
licenses, franchises or concessions.

2
<PAGE> 3

The Company's facilities are subject to federal, state and local
environmental control regulations. To date, compliance with these environmental
regulations has not had a material effect on the Company's earnings nor has it
required the Company to make significant capital expenditures.

The Company conducts a significant amount of its business and has a number
of operating facilities in countries outside the United States. As a result, the
Company is subject to business risks inherent in non-U.S. activities, including
political uncertainty, import and export limitations, exchange controls and
currency fluctuations. The Company believes risks related to its foreign
operations are mitigated due to the political and economic stability of the
countries in which its largest foreign operations are located.

Research activities relating to the development of new products and the
improvement of existing products in 1994 were all Company-sponsored. These
activities were primarily related to the development of new products utilizing
the latest electronic technology. The number of professional employees engaged
full-time in these research activities was 113. Refer to Note A to the
consolidated financial statements with respect to total costs of research and
development.

The number of persons employed by the Company worldwide at December 31,
1994 was 5,693. Effects of plant closures have reduced worldwide employment
levels in 1994. Refer to Note C to the consolidated financial statements with
respect to restructuring activities.

The table below sets forth consolidated net sales by product line for the
most recent three years:

<TABLE>
<CAPTION>
1994 1993 1992
-------- -------- --------
(IN THOUSANDS OF DOLLARS)
<S> <C> <C> <C>
Arc Welding and Other Welding Products..... $843,643 $795,072 $816,389
93% 94% 96%
All Other.................................. 62,961 50,927 36,618
7% 6% 4%
-------- -------- --------
$906,604 $845,999 $853,007
======== ======== ========
</TABLE>

Item 2. PROPERTIES

The Company's corporate headquarters and principal United States
manufacturing facilities are located in the Cleveland, Ohio area. Total
Cleveland area property consists of 230 acres, of which present manufacturing
facilities comprise an area of approximately 2,658,410 square feet. While
current utilization of existing facilities is high, the Company is adding
capacity as necessary.

In addition to the principal facilities in Ohio, the Company operates two
other manufacturing locations in the United States plus 12 manufacturing
locations in 10 foreign countries, the locations of which are as follows:

<TABLE>
<S> <C>
Unites States: Gainesville, Georgia; Monterey Park, California.
Australia: Sydney.
Canada: Toronto.
England: Sheffield.
France: Grand-Quevilly
Ireland: Rathnew.
Italy: Pianoro; Milano.
Mexico: Mexico City.
Netherlands: Nijmegen.
Norway: Skjelland; Stavern.
Spain: Barcelona.
</TABLE>

Manufacturing facilities located in Germany, Venezuela, Japan and Brazil
were closed in early 1994 under the Company's restructuring program.

3
<PAGE> 4

All property relating to the Company's Cleveland, Ohio headquarters and
manufacturing facilities is owned outright by the Company. In addition, the
Company maintains operating leases for its distribution centers and many sales
offices throughout the world. See Note J to the consolidated financial
statements with respect to leases. Most of the Company's foreign subsidiaries
own manufacturing facilities in the foreign country where they are located. At
December 31, 1994, $7.9 million of indebtedness was secured by property, plant
and equipment.

Item 3. LEGAL PROCEEDINGS

The Company is subject, from time to time, to a variety of civil and
administrative proceedings arising out of its normal operations, including,
without limitation, employment-related actions, product liability claims, and
health, safety and environmental claims. Included in such proceedings are the
cases summarily described below, in which claimants seek recovery for injuries
allegedly resulting from exposure to fumes and gases in the welding environment.

The Company is a co-defendant in eighteen cases alleging that exposure to
manganese contained in arc welding electrode products caused the plaintiffs to
develop a neurological condition known as manganism. The plaintiffs seek
compensatory and, in most instances, punitive damages, usually for unspecified
sums. Two similar cases have been tried, both to defense verdicts.

The Company is also a defendant in one case, and one of several
co-defendants in three other cases, alleging that exposure to welding fumes
generally impaired the respiratory system of the plaintiffs. The plaintiffs seek
compensatory and punitive damages, in most cases for unspecified sums. During
the preceding five years, thirty-eight similar cases have resulted in ten
voluntary dismissals, seven defense verdicts or summary judgments and twenty-one
settlements for immaterial amounts.

Claims pending against the Company alleging asbestos induced illness total
nine thousand seven hundred fifty-eight (9,758); in each instance, the Company
is one of a large number of defendants. Approximately (4,416) of these asbestos
claims are pending in Orange County, Texas and a motion to certify a class
action, which is being contested vigorously, is pending. The asbestos claimants
seek compensatory and punitive damages, in most cases for unspecified sums.
Twenty cases have been tried, all to defense verdicts. Voluntary dismissals on
such claims total fourteen thousand one hundred sixty-eight (14,168); summary
judgments for the defense total fifty-nine.

The Company, together with the hundreds of other co-defendants, is a
defendant in state court in Morris County, Texas, in litigation on behalf of
three thousand forty-two (3,042) claimants, all prior employees of a local pipe
fabricator, alleging that occupational exposures caused a wide variety of
illnesses. The plaintiffs seek compensatory and punitive damages of unspecified
sums.

The Company bears the costs of defending those of its product liability
cases arising and filed after 1990. In many cases where there are multiple
defendants, cost sharing efficiencies are arranged. Subject to the Company's per
claim retention under its insurance coverage, the Company has tendered the
manganese, fume, asbestos and Morris County, Texas cases to its insurance
carrier which has accepted such tender for all situations except those where
liability would result solely from asbestos; no such situations have arisen to
date.

The Company believes that resolution of the pending cases referred to
above, individually or in the aggregate, will not have a material effect upon
the Company.

Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matters were submitted to a vote of security holders during the quarter
ended December 31, 1994.

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PART II

Item 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED SHAREHOLDER
MATTERS

The Company's Common Stock is traded on the over-the-counter market. The
number of record holders of Common Stock at December 31, 1994 was 2,545.

There is no public trading market for Class A Common Stock, which has only
been issued to the Company's Employee Stock Ownership Plan.

Quarterly high and low stock prices, based on end of month quotes, and
dividends paid for the last two years were:

<TABLE>
<CAPTION>
1994 1993
----------------------------- -----------------------------------
CASH CASH
BID PRICE* DIVIDENDS BID PRICE* DIVIDENDS
---------------- --------- ---------------------- ---------
QUARTER ENDED HIGH LOW PAID HIGH LOW PAID
----------------------------------- ------ ------ --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
March 31........................... $18.25 $17.25 $ .18 $ 21.00 $ 19.20 $ .18
June 30............................ 27.25 18.75 .18 20.50 19.20 .18
September 30....................... 35.50 30.00 .18 20.50 17.00 .18
December 31........................ 39.00 34.50 .20** 18.00 16.25 .18
</TABLE>

---------------

* Source: Ohio Dealers' Data Service

** Includes special dividend of $.02 per share.

Future dividends, which are subject to limitations under the Credit
Agreement and the Senior Note Agreement, will be based on financial performance
of the Company (see Note D to the consolidated financial statements for a
further description of these limitations.)

Item 6. SELECTED FINANCIAL DATA

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
------------------------------------------------------------
1994 1993 1992 1991 1990
-------- -------- -------- -------- --------
(IN THOUSANDS OF DOLLARS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C>
Net sales......................... $906,604 $845,999 $853,007 $833,892 $796,671
Income (loss) before cumulative
effect of accounting change..... 48,008 (40,536) (45,800) 14,365 11,052
Cumulative effect of accounting
change.......................... 2,468
-------- -------- -------- -------- --------
Net income (loss)................. $ 48,008 $(38,068) $(45,800) $ 14,365 $ 11,052
======== ======== ======== ======== ========
Per common share:
Income (loss) before cumulative
effect of accounting change..... $ 4.38 $ (3.74) $ (4.24) $ 1.33 $ 1.03
Cumulative effect of accounting
change.......................... .23
-------- -------- -------- -------- --------
Net income (loss)................. $ 4.38 $ (3.51) $ (4.24) $ 1.33 $ 1.03
======== ======== ======== ======== ========
Cash dividends declared........... $ .76 $ .72 $ .72 $ .61 $ 1.26
Total assets...................... $556,857 $559,543 $603,347 $640,261 $572,230
Long-term debt.................... 194,831 216,915 221,470 155,547 110,940
</TABLE>

See Note C to the consolidated financial statements with respect to
restructuring activities in 1993 and 1992.

5
<PAGE> 6

Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

GENERAL

The Company is engaged primarily in the design, manufacture and sale of arc
welding and other welding products, which represented 93% of the Company's 1994
net sales. The Company is one of the world's largest manufacturers of arc
welding products. The Company also designs, manufactures and sells integral
horsepower industrial electric motors.

In 1994, the Company reported the highest net sales, net income and net
income per common share in its history. This sales increase was broadly based
and was primarily attributable to increased volume, higher selling prices and
improved economic conditions in the United States, Canada and Europe. The
Company believes that the high quality of its products, advanced engineering
expertise and strong distributor network coupled with its large technically
trained sales force, has permitted the Company to increase global market share.

The Company's 1992 and 1993 earnings were negatively affected by
restructuring charges taken by the Company to consolidate and reorganize foreign
operations. In 1992, the Company recorded a restructuring charge of $23.9
million (without tax benefit, or $2.21 per share) as a result of decisions by
management at that time to downsize and streamline certain non-U.S. operations
(principally in Europe). The 1992 restructuring charge was primarily for
severance pay, redundancies and other liabilities relating to the reorganization
of the sales and distribution operations.

In 1993, the Company decided to terminate operations in early 1994 of its
Messer Lincoln subsidiary in Germany (the "German Subsidiary") as well as
manufacturing operations in Brazil, Venezuela and Japan. Sales, marketing and
distribution activities continue in these countries. The 1993 restructuring
resulted in a charge of $70.1 million ($40.9 million after-tax, or $3.77 per
share). The elements of this charge were: (i) asset writedowns in the amount of
$45.9 million including goodwill of $8.9 million; (ii) severance and other
redundancy costs of $27.5 million; and (iii) a net credit of $3.3 million
comprised of a claim settlement and other restructuring liabilities including
estimated losses through the final facility closing dates in 1994. To date,
approximately 1,400 employees have been terminated as a result of the 1992 and
1993 restructuring programs. The remaining cash outlays to complete the
restructuring are expected to be incurred in 1995 and 1996. Management believes
it has adequately provided for costs and expenses of the restructuring. Although
European sales and profitability remained constrained in 1994, the 1992 and 1993
restructuring programs have returned the Company's European operations to
profitability.

Research and development expenditures by the Company, exluding the
German Subsidiary expenditures, increased approximately 16.5% to $17.6 million
in 1993 and increased 5.2% to $18.5 million in 1994. The Company believes that,
over the past three years, expenditures for research and development activities
have been adequate to maintain the Company's product lines and to introduce new
products at an appropriate rate to sustain future growth. Expenditures on
research and development are expected to increase in 1995.

6
<PAGE> 7

RESULTS OF OPERATIONS

The following table shows the Company's results of operations for the years
ended December 31, 1994, 1993 and 1992:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------------------------------------------
1994 1993 1992
----------------- ----------------- -----------------
% OF % OF % OF
AMOUNT SALES AMOUNT SALES AMOUNT SALES
------ ------ ------ ------ ------ ------
(IN MILLIONS OF DOLLARS)
<S> <C> <C> <C> <C> <C> <C>
Net Sales.......................... $906.6 100.0% $846.0 100.0% $853.0 100.0%
Cost of Goods Sold................. 556.2 61.3% 532.8 63.0% 553.1 64.8%
------ ------ ------ ------ ------ ------
Gross Profit..................... 350.4 38.7% 313.2 37.0% 299.9 35.2%
Distribution Cost/Selling
General & Administrative
Expenses...................... 261.7 28.9% 277.0 32.7% 299.2 35.1%
------ ------ ------ ------ ------ ------
Operating Income before
Restructuring................. 88.7 9.8% 36.2 4.3% 0.7 0.1%
Restructuring Charge (income)...... (2.7) -0.3% 70.1 8.3% 23.9 2.8%
------ ------ ------ ------ ------ ------
Operating Income (loss).......... 91.4 10.1% (33.9) -4.0% (23.2) -2.7%
Other Income....................... 3.1 0.3% 2.9 0.3% 4.4 0.5%
Interest Expense, Net.............. (14.3) -1.6% (16.0) -1.9% (15.6) -1.8%
------ ------ ------ ------ ------ ------
Income (loss) before Income
Taxes......................... 80.2 8.8% (47.0) -5.6% (34.4) -4.0%
Income Taxes (benefit)............. 32.2 3.5% (6.4) -0.8% 11.4 1.3%
------ ------ ------ ------ ------ ------
Net Income (loss) before Cumula-
tive effect of Accounting
Change........................ $ 48.0 5.3% $(40.6) -4.8% $(45.8) -5.3%
Cumulative effect to January 1,
1993 of change in method of
accounting for income taxes...... 2.5 .3%
------ ------ ------ ------ ------ ------
Net Income (loss).................. $ 48.0 5.3% $(38.1) -4.5% $(45.8) -5.3%
====== ====== ====== ====== ====== ======
</TABLE>

1994 COMPARED TO 1993

Net Sales. Net sales for 1994 were $906.6 million, an increase of $60.6
million or 7.2% from $846.0 million for 1993. Net sales for 1993 include the
sales of manufacturing operations (principally in Germany) that were closed in
early 1994. Excluding the 1993 sales of the closed operations, sales for 1994
increased 17.0%. A portion of this increase was due to the absorption by the
Company's other manufacturing operations of the sales formerly made by the
closed operations. Sales from the Company's U.S. operations were $641.6 million
in 1994 or 18.1% higher than 1993 sales of $543.5 million, attributable to
volume and price increases. Non-U.S. sales in 1994 were $265.0 million compared
to $302.5 million in 1993, a decrease of 12.4%. Excluding the 1993 sales of the
closed operations, non-U.S. sales for 1994 increased 14.7% over non-U.S. sales
for 1993 reflecting improved economic conditions in Europe and elsewhere in the
world. A portion of this increase was also due to the absorption by the
Company's other manufacturing operations of the sales formerly made by the
Company's closed German Subsidiary. Total U.S. export sales were $105.3 million
in 1994, an increase of $18.1 million or 20.8% from $87.2 million in 1993. This
increase in export sales largely reflects improved worldwide economic
conditions. In 1994, sales of certain new products were restricted by capacity
limitations inherent in tooling up production which have now been resolved.

Gross Profit. Gross profit increased to $350.4 million in 1994 as compared
with $313.2 million in 1993. Gross profit as a percentage of sales improved to
38.7% in 1994 from 37.0% in 1993. This improvement in gross profit is largely
attributable to a greater percentage of total sales coming from the higher
margin U.S. operations in 1994. In addition, 1993 gross profit was unfavorably
affected as it included lower gross profit levels for the manufacturing
operations that were closed in early 1994. Gross profit for the Company's U.S.
operations in 1994 remained substantially consistent with 1993 at 40.2%.

7
<PAGE> 8

Distribution Cost/Selling, General and Administrative
Expenses. Distribution cost/selling, general and administrative expenses were
$261.7 million in 1994, or 28.9% of sales (28.6% at the Company's U.S.
operations), as compared to $277.0 million, or 32.7% of sales in 1993 (29.9% at
the Company's U.S. operations). The decrease in these expenses as a percentage
of sales evidences the effects of the closing of the German Subsidiary, the
Company's restructuring program and management's initiatives to control
operating costs throughout the Company. The higher expense level in 1993 was
principally due to the inclusion of the operating results of the Company's
closed German Subsidiary. Included in distribution cost/selling, general and
administrative expenses are the costs ($68.4 million in 1994 and $61.9 million
in 1993) related to the Company's discretionary employee bonus program.

Interest Expense, Net. Interest expense, net was $14.3 million in 1994 as
compared with $16.0 million in 1993, a decrease which reflects the effect of
lower debt levels offset partially by higher interest rates.

Income Taxes. Income taxes in 1994 were $32.2 million on income before
income taxes of $80.2 million, an effective rate of 40.1%, as compared to a tax
benefit of $6.4 million on a loss before income taxes of $47.0 million in 1993.
The 1993 tax benefit principally reflects the tax benefits attributable to the
plant closure and liquidation of the German Subsidiary. Results from 1993 also
benefited from the cumulative effect of a change in accounting for income taxes,
which decreased the net loss by $2.5 million or $0.23 per share.

Net Income. As a result of the restructuring programs in 1992 and 1993 and
the improvement in economic conditions in Europe, the United States and Canada,
net income for 1994 was $48.0 million as compared to a net loss of $38.1 million
in 1993. Results in 1993 were adversely affected by a $40.9 million net-of-tax
restructuring charge. 1994 results benefited from a net reversal of $2.7 million
of restructuring charges recorded previously.

1993 COMPARED TO 1992

Net Sales. Net sales for 1993 were $846.0 million, a decrease of $7.0
million or less than 1.0% from 1992 sales of $853.0 million. Excluding the 1993
and 1992 sales of the operations closed in early 1994, sales increased 5.7%.
Sales from the Company's U.S. operations in 1993 were $543.5 million or 11.6%
higher than 1992 sales of $487.1 million, attributable to volume and price
increases. Non-U.S. sales in 1993 were $302.5 million compared to $365.9 million
in 1992, a decrease of 17.3%. Excluding the sales of operations closed in early
1994, non-U.S. sales for 1993 decreased 5.8% from 1992 non-U.S. sales. Currency
translation adversely affected these 1993 sales by $23.5 million. Total U.S.
export sales were $87.2 million in 1993, a decrease of $10.4 million or 10.6%
from $97.6 million in 1992. This decrease in export sales reflects the depressed
economic conditions in Europe and lower intercompany export sales due to
inventory reductions at the Company's foreign subsidiaries.

Gross Profit. Gross profit increased to $313.2 million in 1993 as compared
with $299.9 million in 1992. Gross profit as a percentage of sales improved to
37.0% in 1993 (40.3% at the Company's U.S. operations) from 35.2% in 1992 (37.1%
at the Company's U.S. operations). This improvement in gross profit was largely
attributable to U.S. sales volume increases and improved absorption of
manufacturing costs. Gross profit in 1993 was also favorably impacted by reduced
overhead costs as a result of restructurings in 1992 and reduced price pressures
in Europe. In 1992, gross profit was adversely affected by inventory adjustments
as a result of management's decisions to reduce certain inventory.

Distribution Cost/Selling, General and Administrative
Expenses. Distribution cost/selling, general and administrative expenses were
$277.0 million in 1993, or 32.7% of sales (29.9% at the Company's U.S.
operations), as compared to $299.2 million, or 35.1% of sales in 1992 (31.3% at
the Company's U.S. operations). Expenses for 1993 include $3.7 million for
asset disposals and other non-recurring costs as compared to expenses for 1992
which include $18.9 million relating to certain one-time costs at the Company's
closed German Subsidiary, asset disposals and certain other non-recurring costs.
Included in distribution cost/selling, general and administrative expenses are
the costs ($61.9 million in 1993 and $55.3 million in 1992) related to the
Company's discretionary employee bonus program.

8
<PAGE> 9

Interest Expense, Net. Interest expense, net was $16.0 million in 1993 as
compared with $15.6 million in 1992, reflecting the use of credit facilities
with more favorable terms in 1993, offset by lower interest income in 1993.

Income Taxes. The 1993 tax benefit of $6.4 million on a loss before income
taxes of $47.0 million compares to the 1992 provision for income taxes of $11.4
million on a loss before income taxes of $34.4 million. The 1993 tax benefit
principally reflects the tax benefits attributable to the plant closure and
liquidation of the German Subsidiary. The higher effective rate experienced in
1992 was principally due to losses from non-U.S. subsidiaries that were in net
operating loss carryover positions. Results from 1993 also benefited from the
cumulative effect of a change in accounting for income taxes, which decreased
the net loss by $2.5 million or $0.23 per share.

Net Loss. The net loss for 1993 was $38.1 million as compared to a net loss
of $45.8 million in 1992. Results were adversely affected by restructuring
charges of $40.9 million net-of-tax and $23.9 million without tax benefit in
1993 and 1992, respectively.

LIQUIDITY AND CAPITAL RESOURCES

During the three years ended December 31, 1994, the Company has relied
primarily on cash flow from operations and borrowings to finance working
capital, investments, capital expenditures and the payment of dividends. Cash
provided from operating activities during 1994 amounted to $68.7 million, an
increase of $40.0 million over 1993. This increase in cash flow resulted
primarily from the Company's increase in net income; partially offset by
increased working capital requirements associated with increased sales volume.
Cash provided from operating activities amounted to $28.7 million in 1993 and
$23.6 million in 1992 despite net losses of $38.1 million and $45.8 million,
respectively.

In 1993, the Company acquired the outstanding minority interest in its
subsidiary in Spain for $8.5 million. In 1992, the Company acquired the
outstanding minority interest in its subsidiary Lincoln Norweld and a small
Mexican Company for a total of $37.3 million.

In October 1994, the Company amended its unsecured, multi-currency Credit
Agreement and reduced its committed line under the Credit Agreement from $230.0
million to $200.0 million. The amended Credit Agreement also permits the
establishment of an accounts receivable facility of up to $50 million. See Note
D to the consolidated financial statements for additional information regarding
the terms and financial covenants of the Company's borrowing arrangements. Under
such covenants, the Company's ability to borrow under the Credit Agreement at
December 31, 1994 was limited to aggregate borrowings of $176.9 million. At
December 31, 1994, $100.9 million was outstanding under the Credit Agreement.

Total debt at December 31, 1994 was $212.9 million compared to $250.3
million at December 31, 1993 reflecting the significantly improved 1994
financial results and cash flow from operating activities. At December 31, 1994,
total debt was 52.3% of total capitalization compared with 64.0% at year end
1993.

Capital expenditures for property, plant and equipment totaled $37.4
million in 1994 and $19.1 million in 1993. These expenditures for property,
plant and equipment represent the Company's continued commitment to support and
develop advanced technologies, support new products, expand current capacity and
reduce future manufacturing costs. The Company is continuing the modernization
and expansion of its motor division, has established a separate facility in
Cleveland dedicated to motor manufacturing and is increasing its testing and
design capacity to be able to reduce costs, increase output, and meet scheduled
higher industry efficiency standards.

The Company continues to closely monitor its capital expenditures and is
adding to capacity and modernizing facilities as necessary. While the financial
covenants of the Company's debt agreements place limitations on capital
expenditures, capital expenditures for 1995 are expected to increase over 1994
expenditures.

9
<PAGE> 10

A total of $8.1 million in dividends, including a special dividend, was
paid in 1994. Although the Company paid a special dividend of $.02 per share in
the fourth quarter of 1994, management expressed its intention of not continuing
such a practice in the future. The Company's amended credit facility and 8.98%
Senior Note Agreement contain various financial covenants that place limitations
on the payments of dividends, the purchase of unrestricted stock, capital
expenditures, and the incurrence of additional indebtedness. The losses of 1993
and 1992 placed constraints on the Company's financial flexibility, the impact
of which was reduced, but not eliminated, by the strong 1994 performance.

The Company's Board of Directors believes that the Company's future growth
and success would be enhanced by a reduction in the Company's leverage and
access to greater capital. The Company has explored a variety of alternative
forms of equity financings, both private and public. On March 30, 1995, the
Board of Directors authorized presentation to the Company's shareholders of
amendments to the Company's Articles of Incorporation that would provide the
basis for a plan of recapitalization to include the creation of a new class of
non-voting common stock. If the Company's shareholders approve the amendments to
the Articles of Incorporation, the Company anticipates that the Board of
Directors would declare a dividend of one share of non-voting common stock for
each outstanding share of common stock. The Company anticipates that
concurrently with such dividend, it would engage in a public offering of
non-voting common stock. The size and timing of such offering is dependent on a
variety of factors, many of which are outside the Company's control. There is no
certainty that such offering will be accomplished. In the event such offering is
not accomplished, the Company would reconsider alternative sources of equity
financing. There is no certainty that any such alternatives will be approved by
the Company's Board of Directors or, if so approved, be available. While
additional capital resources would allow a higher rate of capital expenditures
and provide more flexibility for growth, management believes that the current
financing arrangements and the cash flows generated from operations will provide
adequate funds to support the existing operations of the Company and satisfy
both its capital requirements and regular dividend practices throughout the term
of the Credit Agreement.

Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The response to this item is submitted in a separate section of this report
following the signature page.

Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.

None.

PART III

A definitive proxy statement will be filed pursuant to Regulation 14A of
the Securities Exchange Act prior to April 29, 1995. Therefore, information
required under this part, unless set forth below, is incorporated herein by
reference from such definitive proxy statement.

<TABLE>
<CAPTION>
NAME AGE POSITION
---------------------------- --- -------------------------------------------------
<S> <C> <C>
Donald F. Hastings 66 Chairman of the Board and Chief Executive Officer
of the Company since 1992; President of the
Company 1987-1992.
Frederick W. Mackenbach 64 President and Chief Operating Officer of the
Company since 1992; President of Latin America
1991-1992; District Manager 1976-1991.
Harry Carlson 60 Vice Chairman of the Company since 1987.
David J. Fullen 63 Senior Vice President, Machine and Motor Division
since 1994; Vice President - Machine and Motor
Division 1989-1994.
</TABLE>

10
<PAGE> 11

<TABLE>
<CAPTION>
NAME AGE POSITION
---------------------------- --- -------------------------------------------------
<S> <C> <C>
John M. Stropki 44 Senior Vice President, Sales since 1994; General
Sales Manager 1992-1994; District Manager
1986-1992.
Richard C. Ulstad 55 Senior Vice President, Consumable Division since
1994; Vice President - Manufacturing Electrode
Division 1992-1994; Superintendent - Electrode
Division 1984-1992.
Frederick W. Anderson 42 Vice President, Manufacturing - Machine Division
since 1994; Plant Manager Machine and Motor
Division 1993-1994; Plant Superintendent
1989-1993.
Paul J. Beddia 61 Vice President, Human Resources since 1989.
Dennis D. Crockett 52 Vice President, Consumable Research and
Development since 1993; Chief Engineer,
Consumables Research and Development 1987 - 1993.
James R. Delaney 46 Corporate Vice President and President Lincoln
Latin America since 1994; President Lincoln
Electric South America 1993-1994; Vice President
of Lincoln Latin America 1992; Vice President of
Lincoln Mexicana 1988-1992.
H. Jay Elliott 53 Vice President, Chief Financial Officer, and
Treasurer since 1994; International Chief
Financial Officer 1993-1994; prior thereto,
Assistant Comptroller of The Goodyear Tire &
Rubber Company responsible at various times for
Corporate Strategic Planning, Finance Director of
North American Tires and International Vice
President-Finance.
Paul F. Fantelli 50 Vice President, Business Development since 1994;
Assistant to the Chief Executive Officer
1992-1994; President and Chief Executive Officer
of the Company's subsidiary, Harris Calorific
1990-1992.
Anthony Massaro 51 Corporate Vice President and President Lincoln
Europe since 1994; Director of International
Operations 1993-1994; prior thereto, as a
corporate officer with Westinghouse Electric
Corporation, served as Vice President and then as
President and a Member of the Management
Committee with responsibilities worldwide.
Ronald A. Nelson 45 Vice President, Machine Research and Development
since 1994; Chief Engineer - Machine and Motor
Division 1993-1994; Service Manager 1989-1993.
Richard J. Seif 47 Vice President, Marketing since 1994; Director of
Marketing 1991-1994; Project Manager 1989-1991.
Frederick G. Stueber 41 Vice President, General Counsel and Secretary
since February 1995; prior thereto, partner in
the law firm of Jones, Day, Reavis and Pogue.
John H. Weaver 56 Vice President, Export Sales since 1994;
International Sales Manager 1987-1994.
</TABLE>

11
<PAGE> 12

PART IV

Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(a) (1) FINANCIAL STATEMENTS

The following consolidated financial statements of the Company are included
in a separate section of this report following the signature page:

Statements of Consolidated Financial Condition -- December 31, 1994 and
1993

Statements of Consolidated Operations -- Year ended December 31, 1994,
1993 and 1992

Statements of Consolidated Shareholders' Equity -- Year ended December
31, 1994, 1993 and 1992

Statements of Consolidated Cash Flows -- Year ended December 31, 1994,
1993 and 1992

Notes to Consolidated Financial Statements -- December 31, 1994

Reports of Independent Auditors

(a) (2) FINANCIAL STATEMENT SCHEDULES

The following consolidated financial statement schedule of the Company is
included in a separate section of this report following the signature page:

Schedule II -- Valuation and Qualifying Accounts

All other schedules for which provision is made in the applicable
accounting regulation of the Securities and Exchange Commission are not required
under the related instructions or are inapplicable, and therefore, have been
omitted.

(a) (3) EXHIBITS

<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
----------- --------------------------------------------------------------------------
<S> <C>
3(a) Amended and Restated Articles of Incorporation of The Lincoln Electric
Company (filed as Exhibit 3(a) to Form 10-K of The Lincoln Electric
Company for the year ended December 31, 1993, SEC File No. 0-1402 and
incorporated herein by reference and made a part hereof).
3(b) Amended and Restated Code of Regulations of The Lincoln Electric Company
filed herewith.
4(a) Note Agreement dated November 20, 1991 between The Prudential Insurance
Company of America and the Company (filed as Exhibit 4 to Form 10-K of The
Lincoln Electric Company for the year ended December 31, 1991, SEC File
No. 0-1402 and incorporated by reference and made a part hereof), as
amended by letter dated March 18, 1993; 8.98% Senior Note Due November 26,
2003 (filed as Exhibit 4(a) to Form 10-K of The Lincoln Electric Company
for the year ended December 31, 1992, SEC File No. 0-1402 and incorporated
herein by reference and made a part hereof); as further amended by letter
dated as of November 19, 1993; 8.98% Senior Note Due November 26, 2003
(filed as Exhibit 4(a) to Form 10K of The Lincoln Electric Company for the
year ended December 31, 1993, SEC File No. 0-1402 and incorporated herein
by reference and made a part hereof), and as further amended by letter
dated October 31, 1994 (filed as Exhibit 4(a) to Form 10Q of The Lincoln
Electric Company for the period ended September 30, 1994, SEC File No.
0-1402 and incorporated herein by reference and made a part hereof).
</TABLE>

12
<PAGE> 13

<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
----------- --------------------------------------------------------------------------
<S> <C>
4(b) Credit Agreement dated March 18, 1993 among the Company, the Banks listed
on the signature page thereof, and Society National Bank, as Agent (filed
as Exhibit 4 (b) to Form 10-K of The Lincoln Electric Company for the year
ended December 31, 1992, SEC File No. 0-1402 and incorporated herein by
reference and made a part hereof), as amended by Amendment No.1 to Credit
Agreement dated November 19, 1993; 8.98% Senior Note Due November 26, 2003
(filed as Exhibit 4(b) to Form 10K of The Lincoln Electric Company for the
year ended December 31, 1993, SEC File No. 0-1402 and incorporated herein
by reference and made a part hereof), and as further amended by Amendment
No. 2 to Credit Agreement dated October 31, 1994 (filed as Exhibit 4(b) to
Form 10Q of The Lincoln Electric Company for the period ended September
30, 1994, SEC File No. 0-1402 and incorporated herein by reference and
made a part hereof).
9 Voting Trust Agreement filed herewith.
10(a)* The Lincoln Electric Company 1988 Incentive Equity Plan (filed as Exhibit
28 to the Form S-8 Registration Statement of The Lincoln Electric Company,
SEC File No. 33-25209 and incorporated herein by reference and made a part
hereof).
10(b) Form of Indemnification Agreement filed herewith.
10(c) Supplemental Executive Retirement Plan dated as of January 1, 1994.
10(d) The Lincoln Electric Company Deferred Compensation Plan dated as of
November 10, 1994.
10(e) Employment Agreement between the Company and Anthony A. Massaro dated July
14, 1993, as amended on January 1, 1994.
10(f) Employment Agreement between the Company and H. Jay Elliott dated June 22,
1993.
10(g) Employment Agreement between the Company and Frederick G. Stueber dated
February 22, 1995.
10(h) Severance Agreement between the Company and Roger F. Young dated August
11, 1994.
10(i) Severance Agreement between the Company and John Gonzalez dated November
22, 1994.
11 Computation of earnings per share.
21 Subsidiaries of the Registrant.
23 Consents of Independent Auditors.
27 Financial Data Schedule.
</TABLE>

* Reflects executive compensatory arrangement required to be filed as an Exhibit
pursuant to Item 14(c) of this Report.

Upon request, The Lincoln Electric Company will furnish to security holders
copies of any exhibit to the Form 10-K report upon payment of a reasonable fee.
Any requests should be made in writing to: Mr. H. Jay Elliott, Vice President,
Chief Financial Officer and Treasurer, The Lincoln Electric Company, 22801 St.
Clair Avenue, Cleveland, Ohio 44117, Phone: (216) 481-8100.

13
<PAGE> 14

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

The Lincoln Electric Company
------------------------------------
(Registrant)

/s/ H. JAY ELLIOTT
------------------------------------
H. Jay Elliott
Vice President,
Chief Financial Officer
and Treasurer
(principal financial and
accounting officer)

14
<PAGE> 15

Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities indicated on March 31, 1995.

<TABLE>
<S> <C>
/s/ DONALD F. HASTINGS /s/ FREDERICK W. MACKENBACH
----------------------------------------- -----------------------------------------
Donald F. Hastings, Chairman of the Frederick W. Mackenbach, President,
Board and Chief Executive Officer Chief Operating Officer and Director
(principal executive officer)

/s/ HARRY CARLSON /s/ DAVID H. GUNNING
----------------------------------------- -----------------------------------------
Harry Carlson, Vice Chairman and David H. Gunning, Director
Director

/s/ EDWARD E. HOOD, JR. /s/ PAUL E. LEGO
----------------------------------------- -----------------------------------------
Edward E. Hood, Jr., Director Paul E. Lego, Director

/s/ HUGH L. LIBBY /s/ DAVID C. LINCOLN
----------------------------------------- -----------------------------------------
Hugh L. Libby, Director David C. Lincoln, Director

/s/ EMMA S. LINCOLN /s/ G. RUSSELL LINCOLN
----------------------------------------- -----------------------------------------
Emma S. Lincoln, Director G. Russell Lincoln, Director

/s/ HENRY L.MEYER III /s/ LAWRENCE O. SELHORST
----------------------------------------- -----------------------------------------
Henry L. Meyer, III, Director Lawrence O. Selhorst, Director

/s/ CRAIG R. SMITH /s/ FRANK STEINGASS
----------------------------------------- -----------------------------------------
Craig R. Smith, Director Frank Steingass, Director

/s/ H. JAY ELLIOTT
-----------------------------------------
H. Jay Elliott, Vice President, Chief
Financial Officer and Treasurer
(principal financial and accounting
officer)
</TABLE>

15
<PAGE> 16

ANNUAL REPORT ON FORM 10-K

ITEM 8, ITEM 14(a)(1) AND (2) AND ITEM 14(d)

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

FINANCIAL STATEMENT SCHEDULES

YEAR ENDED DECEMBER 31, 1994

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

16
<PAGE> 17

REPORT OF INDEPENDENT AUDITORS

Shareholders and Board of Directors
The Lincoln Electric Company

We have audited the consolidated financial statements of The Lincoln
Electric Company and subsidiaries listed in the accompanying index to financial
statements Item 14 (a1). Our audits also included the financial statement
schedule listed in the Index at Item 14 (a2). These financial statements and
schedule are the responsibility of the Company's management. Our responsibility
is to express an opinion on these financial statements and schedule based on our
audits. We did not audit the consolidated financial statements of The Lincoln
Electric Company (Australia) Proprietary Limited and subsidiaries and, for 1992,
the consolidated financial statements of Lincoln-Norweld B.V. and subsidiaries
and the consolidated financial statements of Messer Lincoln GmbH and subsidiary,
all consolidated subsidiaries, which statements reflect total assets
constituting 7% in 1994 and 5% in 1993 and total revenues constituting 5% in
1994 and 1993 and 36% in 1992 of the related consolidated totals. Those
statements were audited by other auditors whose reports have been furnished to
us, and our opinion, insofar as it relates to data included for The Lincoln
Electric Company (Australia) Proprietary Limited and subsidiaries and, for 1992,
Lincoln Norweld B.V. and subsidiaries and Messer Lincoln GmbH and subsidiary, is
based solely on the reports of the other auditors.

We conducted our audits 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 audits and the reports of other auditors provide a
reasonable basis for our opinion.

In our opinion, based on our audits and the reports of other auditors, the
consolidated financial statements referred to above present fairly, in all
material respects, the consolidated financial position of The Lincoln Electric
Company and subsidiaries at December 31, 1994 and 1993, and the consolidated
results of their operations and their cash flows for each of the three years in
the period ended December 31, 1994 in conformity with generally accepted
accounting principles. Also, in our opinion, the related financial statement
schedule, when considered in relation to the basic financial statements taken
as a whole, presents fairly in all material respects the information set forth
therein.

As discussed in Note A to the consolidated financial statements, effective
January 1, 1993, the Company changed its method of accounting for income taxes.

ERNST & YOUNG LLP

Cleveland, Ohio
March 3, 1995

17
<PAGE> 18

To the Board of Directors of
The Lincoln Electric Company

REPORT OF INDEPENDENT ACCOUNTANTS

In our opinion, the consolidated balance sheets and the related
consolidated statements of income and retained earnings and of cash flows (none
of which are presented separately herein) present fairly, in all material
respects, the financial position of The Lincoln Electric Company (Australia)
Proprietary Limited and its subsidiaries at December 31, 1994 and 1993, and the
results of their operations and their cash flows for each of the three years in
the period ended December 31, 1994, in conformity with generally accepted
accounting principles. These financial statements are the responsibility of the
Company's management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
statements in accordance with generally accepted auditing standards which
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, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for the opinion expressed above.

Parramatta, Australia
March 27, 1995

18
<PAGE> 19

INDEPENDENT AUDITORS' REPORT

The Board of Directors
of Messer Lincoln GmbH

We have audited the consolidated balance sheet of Messer Lincoln GmbH and
its subsidiary as of December 31, 1992 and the balance sheet of Messer Lincoln
GmbH as of December 31, 1991 and the related (consolidated) statements of
income, retained earnings, and cash flows for the year ended December 31, 1992
and the period ended December 31, 1991. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements (none of which are presented separately
herein) based on our audits.

The Company is a subsidiary of The Lincoln Electric Company based in
Cleveland, Ohio, USA, which is responsible for management of the Company. The
financial statements have been prepared assuming that the Company will continue
as a going concern. The Company has suffered considerable losses in 1992 and
1991 and is dependent on the continued support of The Lincoln Electric Company
for the continuance of its operations. The Lincoln Electric Company has
confirmed that it will provide financial and other support to enable the Company
to continue to trade as a viable and solvent business entity at least through
December 31, 1993.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Messer Lincoln GmbH and its
subsidiary as of December 31, 1992 and of Messer Lincoln GmbH as of December 31,
1991, and the results of its operations and its cash flows for the year ended
December 31, 1992 and the period ended December 31, 1991 in conformity with
generally accepted accounting principles.

Dusseldorf, March 12, 1993

KPMG KLYNVELD PEAT MARWICK GOERDELER
Gesellschaft mit beschrankter Haftung
Wirtschaftsprufungsgesellschaft

19
<PAGE> 20

To the board of directors of
Lincoln-Norweld B.V.

INDEPENDENT AUDITORS' REPORT

We have audited the consolidated balance sheet of Lincoln-Norweld B.V. and
subsidiaries as of December 31, 1992, and the related consolidated statement of
income, retained earnings and cash flows for the year ended December 31, 1992
(none of which are presented separately herein). These financial statements are
the responsibility of the company'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 in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the balance sheet and
statement of income 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.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of
Lincoln-Norwald B.V. and subsidiaries as of December 31, 1992, and the results
of its operations and its cash flows for the year then ended in conformity with
United States generally accepted accounting principles.

Arnhem, The Netherlands

March 23, 1993

20
<PAGE> 21

STATEMENTS OF CONSOLIDATED FINANCIAL CONDITION

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

<TABLE>
<CAPTION>
DECEMBER 31
1994 1993
-------- --------
(IN THOUSANDS OF
DOLLARS)
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents............................................ $ 10,424 $ 20,381
Accounts receivable (less allowances of $4,251 in 1994; $6,258 in
1993)............................................................. 126,007 110,504
Inventories
Raw materials and in-process...................................... 72,302 66,987
Finished goods.................................................... 82,974 76,698
-------- --------
155,276 143,685
Deferred income taxes -- Note E...................................... 11,601 42,960
Prepaid expenses..................................................... 2,899 3,241
Other current assets................................................. 7,220 4,937
-------- --------
TOTAL CURRENT ASSETS................................................... 313,427 325,708
OTHER ASSETS
Notes receivable from employees...................................... 3,151 4,747
Goodwill -- Note C................................................... 39,213 39,732
Other................................................................ 16,855 19,665
-------- --------
59,219 64,144
PROPERTY, PLANT AND EQUIPMENT
Land................................................................. 12,655 12,802
Buildings............................................................ 118,903 113,927
Machinery, tools and equipment....................................... 312,957 279,933
-------- --------
444,515 406,662
Less allowances for depreciation and amortization.................... 260,304 236,971
-------- --------
184,211 169,691
-------- --------

TOTAL ASSETS........................................................... $556,857 $559,543
======== ========
</TABLE>

21
<PAGE> 22

STATEMENTS OF CONSOLIDATED FINANCIAL CONDITION

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

<TABLE>
<CAPTION>
DECEMBER 31,
1994 1993
-------- --------
(IN THOUSANDS OF
DOLLARS)
<S> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Trade accounts payable............................................... $ 54,766 $ 43,471
Notes payable to banks -- Note D..................................... 15,843 23,198
Salaries, wages and amounts withheld................................. 12,405 12,779
Taxes, including income taxes -- Note E.............................. 21,783 23,061
Dividend payable..................................................... 2,203 1,959
Current portion of long-term debt -- Note D.......................... 2,272 10,200
Accrued restructuring charges -- Note C.............................. 8,968 29,618
Other current liabilities............................................ 25,877 31,569
-------- --------
TOTAL CURRENT LIABILITIES.............................................. 144,117 175,855
LONG-TERM DEBT, less current portion -- Note D......................... 194,831 216,915
DEFERRED INCOME TAXES -- Note E........................................ 6,631 6,128
OTHER LONG-TERM LIABILITIES............................................ 10,337 9,221
MINORITY INTEREST IN SUBSIDIARIES...................................... 6,808 7,929
SHAREHOLDERS' EQUITY
Common Stock, without par value -- at stated
capital amount -- Note B:
Authorized -- 15,000,000 shares
Outstanding -- 10,514,324 shares in 1994 and 10,381,450 shares
in 1993, exclusive of 4,346,516 shares in 1994 and 4,479,390
shares in 1993 held in treasury................................ 2,103 2,076
Class A Common Stock, without par value -- at stated capital
amount --
Note B:
Authorized -- 2,000,000
Outstanding -- 499,840 shares................................... 100 100
Additional paid-in capital........................................... 25,447 22,926
Retained earnings.................................................... 176,965 137,307
Cumulative translation adjustments................................... (10,482) (18,914)
-------- --------
194,133 143,495
-------- --------

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY............................. $556,857 $559,543
======== ========
</TABLE>

See notes to consolidated financial statements.

22
<PAGE> 23

STATEMENTS OF CONSOLIDATED OPERATIONS

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
1994 1993 1992
-------- -------- --------
(IN THOUSANDS OF DOLLARS EXCEPT
PER SHARE DATA)
<S> <C> <C> <C>
Net sales.................................................. $906,604 $845,999 $853,007
Cost of goods sold......................................... 556,259 532,795 553,103
-------- -------- --------
Gross Profit............................................... 350,345 313,204 299,904
Distribution cost/selling, general & administrative
expenses................................................. 261,681 277,003 299,195
Restructuring charges (income) -- Note C................... (2,735) 70,079 23,897
-------- -------- --------
Operating income (loss).................................... 91,399 (33,878) (23,188)
Other income (expense):
Interest income.......................................... 1,442 1,627 3,061
Other income............................................. 3,067 2,922 4,433
Interest expense......................................... (15,740) (17,621) (18,736)
-------- -------- --------
(11,231) (13,072) (11,242)
-------- -------- --------
Income (loss) before income taxes and cumulative effect of
accounting change........................................ 80,168 (46,950) (34,430)
Income taxes (benefit) -- Note E........................... 32,160 (6,414) 11,370
-------- -------- --------
Income (loss) before cumulative effect of accounting
change................................................... 48,008 (40,536) (45,800)
Cumulative effect to January 1, 1993 of change in method of
accounting for income taxes -- Note A.................... 2,468
-------- -------- --------
Net income (loss).......................................... $ 48,008 $(38,068) $(45,800)
======== ======== ========
Per share:
Income (loss) before cumulative effect of accounting
change................................................ 4.38 (3.74) (4.24)
Cumulative effect of accounting change................... .23
-------- -------- --------
Net income (loss)........................................ $ 4.38 $ (3.51) $ (4.24)
======== ======== ========
</TABLE>

See notes to consolidated financial statements.

23
<PAGE> 24

STATEMENTS OF CONSOLIDATED SHAREHOLDERS' EQUITY

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

YEAR ENDED DECEMBER 31, 1994, 1993 AND 1992

<TABLE>
<CAPTION>
CLASS A COMMON
COMMON STOCK STOCK ADDITIONAL CUMULATIVE
------------------- ---------------- PAID IN RETAINED TRANSLATION
SHARES AMOUNT SHARES AMOUNT CAPITAL EARNINGS ADJUSTMENTS TOTAL
---------- ------ ------- ------ ---------- -------- ----------- -----------
(IN THOUSANDS OF DOLLARS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance, January 1, 1992............. 1,039,142 $ 208 35,794 $ 7 $ 20,845 $238,412 $ 4,664 $ 264,136
Net loss........................... (45,800) (45,800)
Cash dividends declared -- $.72 per
share............................ (7,762) (7,762)
Purchases of Common Stock.......... (16,841) (3) (2,473) (1,667) (4,143)
Shares sold to employees........... 9,979 2 2,373 2,375
Shares issued to ESOP.............. 9,268 2 2,058 2,060
Shares issued under Incentive
Equity Plan...................... 1,066 264 264
Adjustment for the year............ (12,407) (12,407)
---------- ------ ------- ------ ---------- -------- ----------- -----------
Balance December 31, 1992............ 1,033,346 207 45,062 9 23,067 183,183 (7,743) 198,723
Net loss........................... (38,068) (38,068)
Cash dividends declared -- $.72 per
share............................ (7,808) (7,808)
Shares sold to employees........... 3,648 1 678 679
Shares issued under Incentive
Equity Plan...................... 1,151 224 224
Ten-for-one stock split............ 9,343,305 1,868 405,558 81 (1,949)
Shares issued to ESOP.............. 49,220 10 906 916
Adjustment for the year............ (11,171) (11,171)
---------- ------ ------- ------ ---------- -------- ----------- -----------
Balance December 31, 1993............ 10,381,450 2,076 499,840 100 22,926 137,307 (18,914) 143,495
Net income......................... 48,008 48,008
Cash dividends declared -- $.76 per
share............................ (8,350) (8,350)
Shares sold to employees........... 107,520 22 2,063 2,085
Shares issued under Incentive
Equity Plan...................... 25,354 5 458 463
Adjustment for the year............ 8,432 8,432
---------- ------ ------- ------ ---------- -------- ----------- -----------
Balance December 31, 1994............ 10,514,324 $2,103 499,840 $100 $ 25,447 $176,965 $ (10,482) $ 194,133
========= ======= ======= ======= ========= ======== ========== ========
</TABLE>

See notes to consolidated financial statements.

24
<PAGE> 25

STATEMENTS OF CONSOLIDATED CASH FLOWS

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
1994 1993 1992
-------- -------- --------
(IN THOUSANDS OF DOLLARS)
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net income (loss).......................................... $ 48,008 $(38,068) $(45,800)
Adjustments to reconcile net income (loss) to net cash
provided by operating activities:
Depreciation and amortization....................... 27,960 30,545 31,511
Deferred income taxes............................... 31,862 (32,501) 538
Cumulative effect of accounting change.............. (2,468)
Foreign exchange loss (gain)........................ 4,047 (348) 957
Employee Stock Ownership Plan....................... 916 2,060
Minority interest................................... 416 (358) (2,158)
Provision for restructuring......................... (2,735) 68,370 18,356
Changes in operating assets and liabilities net of
effects from acquisitions:
(Increase) in accounts receivable.............. (14,003) (6,228) (739)
(Increase) decrease in inventories............. (6,476) 10,654 22,939
(Increase) decrease in other current assets.... (1,447) (1,331) 695
Increase in accounts payable................... 9,929 2,856 171
(Decrease) in other current liabilities.......... (31,026) (2,928) (4,060)
Gross change in other noncurrent assets........ 1,368 (3,112) (2,699)
Other--net..................................... 763 2,734 1,853
-------- -------- --------
NET CASH PROVIDED BY OPERATING ACTIVITIES.................. 68,666 28,733 23,624
INVESTING ACTIVITIES
Purchases of property, plant and equipment............... (37,366) (19,090) (34,847)
Sales of property, plant and equipment................... 5,099 2,599 4,448
Acquisitions, net of cash acquired....................... (8,518) (37,288)
-------- -------- --------
NET CASH USED BY INVESTING ACTIVITIES...................... (32,267) (25,009) (67,687)
FINANCING ACTIVITIES
Proceeds from the sale of Common Stock................... 2,085 679 2,375
Purchase of Common Stock................................. (4,143)
Proceeds from short-term borrowings, maturities greater
than three months..................................... 56,405 305 11,674
Payments on short-term borrowings, maturities greater
than three months..................................... (59,293) (12,736)
Notes payable to banks--net.............................. (5,122) (9,470) (33,416)
Proceeds from long-term borrowings....................... 317,669 603,405 287,317
Payment on long-term borrowings.......................... (351,793) (576,445) (212,111)
Dividends paid........................................... (8,106) (7,791) (7,756)
Other.................................................... 838 (210) 321
-------- -------- --------
NET CASH (USED) PROVIDED BY FINANCING ACTIVITIES........... (47,317) (2,263) 44,261
Effect of exchange rate changes on cash and cash
equivalents.............................................. 961 (1,707) 170
-------- -------- --------
(DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS........... (9,957) (246) 368
Cash and cash equivalents at beginning of year............. 20,381 20,627 20,259
-------- -------- --------
CASH AND CASH EQUIVALENTS AT END OF YEAR................... $ 10,424 $ 20,381 $ 20,627
======== ======== ========
</TABLE>

See notes to consolidated financial statements.

25
<PAGE> 26

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(IN THOUSANDS OF DOLLARS EXCEPT PER SHARE DATA)

DECEMBER 31, 1994

NOTE A -- ACCOUNTING POLICIES

Principles of Consolidation: The consolidated financial statements include
the accounts of The Lincoln Electric Company and its subsidiaries (the
"Company") after elimination of all significant intercompany accounts,
transactions and profits.

Cash Equivalents: The Company considers all highly liquid investments with
a maturity of three months or less when purchased to be cash equivalents.

Inventories: Inventories are valued at the lower of cost or market. For
domestic inventories, cost is determined principally by the last-in, first-out
(LIFO) method, and for foreign inventories cost is determined by the first-in,
first-out (FIFO) method. At December 31, 1994 and 1993, approximately 62% and
60%, respectively, of total inventories were valued using the LIFO method. The
excess of current cost over LIFO cost amounted to $51,739 at December 31, 1994
and $48,876 at December 31, 1993. During 1992, certain LIFO inventories were
reduced, resulting in liquidations of LIFO inventory quantities carried at the
lower costs of prior years, as compared with their 1992 costs. The effect of
these liquidations was to reduce the 1992 net loss after tax, by $1,018 ($.09
per share).

Property, Plant and Equipment: Property, plant and equipment, including
facilities and equipment under capital leases (not material), are stated at cost
and include improvements which significantly extend the useful lives of existing
plant and equipment. Depreciation and amortization are computed by both
accelerated and straight-line methods.

Research and Development: Research and development costs, which are
expensed as incurred, were $18,473 in 1994, $19,210 in 1993 and $19,364 in 1992.

Goodwill: The excess of the purchase price over the fair value of net
assets acquired (goodwill) is amortized by the straight-line basis over periods
not exceeding 40 years. Amounts are stated net of accumulated amortization of
$5,784 and $2,363 in 1994 and 1993, respectively.

The carrying value of goodwill is reviewed if facts and circumstances
indicate a potential impairment of carrying value utilizing relevant cash flow
and profitability information.

Translation of Foreign Currencies: For subsidiaries in countries which do
not have highly inflationary economies, asset and liability accounts are
translated into U.S. dollars using exchange rates in effect at the balance sheet
date and revenue and expense accounts are translated at average monthly exchange
rates. Translation adjustments are reflected as a component of shareholders'
equity.

For subsidiaries in countries with highly inflationary economies (Venezuela
and Brazil) inventories, property, plant and equipment and related depreciation
are translated into U.S. dollars at historical exchange rates. Other asset and
liability accounts are translated at exchange rates in effect at the balance
sheet date and revenues and expenses, excluding depreciation, are translated at
average monthly exchange rates. Translation adjustments for these subsidiaries,
as well as transaction gains and losses of all other subsidiaries, are included
in the statements of consolidated operations in distribution cost/selling,
general and administrative expenses. The Company recorded transaction losses of
$3,746 in 1994, $228 in 1993 and $859 in 1992. The increase in transaction
losses in 1994 is attributable to the effect of the devaluation of the Mexican
peso on a U.S. dollar denominated debt obligation.

26
<PAGE> 27

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- CONTINUED

NOTE A -- ACCOUNTING POLICIES -- (CONTINUED)
Financial Instruments: The Company on a limited basis has used forward
exchange contracts to hedge exposure to exchange rate fluctuations on
anticipated future purchase and sales transactions and certain intercompany
transactions. Any contracts that are entered into are written on a short-term
basis, are not held for trading purposes, and are not held for purposes of
speculation. Gains and losses on forward exchange contracts described herein are
recognized in the statements of consolidated operations in the periods the
exchange rates change. At December 31, 1994, the Company had no outstanding
forward exchange contracts.

Accounting Change: Effective January 1, 1993, the Company adopted FASB
Statement No. 109, "Accounting for Income Taxes." Under Statement No. 109, the
liability method is used in accounting for income taxes. Under this method,
deferred tax assets and liabilities are determined based on differences between
financial reporting and tax bases of assets and liabilities and are measured
using the enacted tax rates and laws that will be in effect when the differences
are expected to reverse. Prior to the adoption of Statement No. 109, income tax
expense was determined using the deferred method under which deferred tax
expense was based on items of income and expense that were reported in different
years in the financial statements and tax returns and were measured at the tax
rate in effect in the year the difference originated. As permitted by Statement
No. 109, the Company elected not to restate the financial statements of any
prior year. The cumulative effect of the change decreased the net loss for 1993
by $2,468 or $.23 per share.

Net Income (Loss) per Share: Net income (loss) per share is based on the
average number of all shares outstanding during the year (10,969,991 in 1994;
10,851,991 in 1993 and 10,796,410 in 1992).

Other: Included in Distribution cost/selling, general & administrative
expenses are the costs related to the Company's discretionary employee bonus
($68,370 in 1994; $61,883 in 1993; and $55,282 in 1992.)

Notes receivable from employees are secured by Company Common Stock owned
by the employee.

Reclassification: Certain reclassifications have been made to prior year
financial statements to conform to current year classifications.

NOTE B -- SHAREHOLDERS' EQUITY

The Lincoln Electric Company Employees' Stock Purchase Plan ("Plan") which
provided that employees could purchase shares of the Company's Common Stock,
when offered, at its estimated fair value, was terminated by the Board of
Directors in February 1995 effective March 30, 1995. Under the Plan, the Company
had the option to repurchase the shares, but in 1992 the Company suspended the
repurchase of all shares and the employees were permitted to sell their shares
on the open market. Upon termination of the Plan, all shares issued under the
Plan (1,639,686) became unrestricted shares.

The Lincoln Electric Company 1988 Incentive Equity Plan ("Incentive Equity
Plan") provides for the award or sale of Common Stock to officers and other key
employees of the Company and its subsidiaries. Distribution of shares is based
on certain specified performance and other conditions being satisfied. As a
result of conditions being fulfilled in 1991 with respect to certain of the
Company's subsidiaries, the Company awarded 32,524 shares (including 524 shares
issued for dividends accrued during the deferral period) of which 10,660 shares
were distributed in 1992, 11,510 shares in 1993, and 10,354 shares in 1994.
These shares, along with 15,000 shares issued to a former officer of the
Company, are restricted as to resale rights with the Company having a right of
first refusal at a purchase price based on the book value of the shares.
Additionally, in 1994, 15,000 shares were issued to certain officers of the
Company. Such shares vest equally over a three-year period, commencing in 1995
and ending in 1997. At December 31, 1994, there were no other outstanding awards
under the Plan, and 952,476 shares are reserved for future issuance under the
Incentive Equity Plan.

27
<PAGE> 28

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- CONTINUED

NOTE B -- SHAREHOLDERS' EQUITY -- (CONTINUED)
The Lincoln Electric Company Employee Stock Ownership Plan (the "ESOP") is
a non-contributory profit-sharing plan established to provide deferred
compensation benefits for all eligible employees. The cost of the plan is borne
by the Company through contributions to an employee stock ownership trust as
determined annually by the Board of Directors. In May 1989, shareholders
authorized 2,000,000 shares of Class A Common Stock ("Class A Common Stock"),
without par value. The Company's Common Stock and Class A Common Stock are
identical in all respects, except that holders of Class A Common Stock are
subject to certain transfer restrictions and the Class A Common Stock is only
issued to the ESOP. In 1994, no shares of stock were issued to the ESOP. In
1993, the Company issued 49,220 shares (92,680 shares in 1992) to the ESOP with
an estimated fair value of $916 ($2,060 in 1992) which was recorded as
compensation expense. The difference between the total stated capital amount of
$.20 per share and the estimated fair value was recorded as additional
paid-in-capital. At December 31, 1994 and 1993, 1,500,160 authorized but
unissued shares are available for future issuance to the ESOP.

NOTE C -- RESTRUCTURING CHARGES

In 1993, the Company substantially completed its plan to downsize and
streamline its foreign operations (principally in Europe) and close
manufacturing facilities in Germany, Japan and South America. Management's
decisions resulted in a restructuring charge in 1993 of $70,100 ($40,900 after
tax or $3.77 per share) which was comprised of (1) asset write-downs in the
amount of $45,900 including goodwill of $8,900; (2) severance and other
redundancy costs of $27,500; and (3) a net credit of $3,300 comprised of a claim
settlement and other restructuring liabilities including estimated losses
through the final facility closing dates in 1994.

In 1992, the Company recorded a restructuring charge of $23,900 (without
tax benefit, or $2.21 per share) as a result of decisions by management at that
time to downsize and streamline certain foreign operations (principally in
Europe). This charge was primarily for severance pay, redundancies and other
liabilities relating to the reorganization of the sales and distribution
operations in Europe.

In 1994, all of the planned facility closings were completed and one of the
facilities was disposed of. In total, approximately 1,400 employees were
terminated as a result of the 1992 and 1993 restructuring programs. In 1994 the
restructuring accruals were adjusted to reflect management's current cost
estimates to complete the program which resulted in a credit to income of
$2,735. Included in property, plant and equipment, are facilities held for sale
with a net carrying value of $4,700. The remaining expenditures, which include
costs related to the sale of real estate and holding costs to be incurred
through the estimated date of disposal, are anticipated to be incurred in 1995
and 1996.

28
<PAGE> 29

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- CONTINUED

NOTE D -- SHORT-TERM AND LONG-TERM DEBT

<TABLE>
<CAPTION>
1994 1993
-------- --------
<S> <C> <C>
Short-term debt:
Notes payable to banks at interest rates from 5.6625% to
11.25% (4.125% to 23.25% in 1993)........................ $ 15,843 $ 23,198
======== ========
Long-term debt:
Multi-currency Credit Agreement, due October 1, 1997........ $100,947 $126,457
8.98% Senior Note due 2003 (equal annual principal payments
commencing in 1996)...................................... 75,000 75,000
Other borrowings due through 2023, interest at 2.00% to
13.74% (3.00% to 13.74% in 1993)......................... 21,156 25,658
-------- --------
$197,103 $227,115
Less current portion........................................ 2,272 10,200
-------- --------
Total $194,831 $216,915
======== ========
</TABLE>

In October 1994, the Company amended its unsecured, multi-currency Credit
Agreement with ten banks and reduced its committed line under the Credit
Agreement from $230,000 to $200,000 which the Company believes is sufficient to
meet future financing needs. Under the terms of the amended agreement which
expires October 1, 1997, but provides for a mechanism for annual extensions, the
interest rate on outstanding borrowings is determined based upon defined
leverage rates for the pricing option selected. The interest rate can range from
the LIBOR plus .375% to LIBOR plus 1.125% depending upon the defined leverage
rate. The agreement also provides for commitment fees ranging from .2% to .375%
per annum on the unused credit lines based upon the defined leverage rate. Prior
to the amendment, the interest rates ranged from LIBOR plus 1% to LIBOR plus 2%,
and the commitment fees were from .375% to .5%.

Simultaneously, with the signing of the Credit Agreement, the $75,000 8.98%
Senior Note due in 2003 was amended to change the financial covenants to conform
with the financial covenants of the amended Credit Agreement, which requires a
1.35 to 1 consolidated current ratio and the maintenance of consolidated
tangible net worth of $125,000 plus 50% of net income subsequent to January 1,
1995. In addition, there are requirements with respect to interest coverage and
funded debt to capital ratios (.60 to 1 decreasing to .50 to 1 after December
31, 1995), and limitations on capital expenditures. Purchases of unrestricted
stock and the payment of dividends are limited to 50% of cumulative net income
from January 1, 1993, plus $25,000. At December 31, 1994, the Company was in
compliance with all of its financial covenants and $13,800 was available for
dividends and the purchase of unrestricted stock. The limitations on capital
expenditures, purchases of unrestricted common stock and payment of dividends
can be waived based on the achievement of a certain interest coverage ratio for
three consecutive quarters.

Maturities of long-term debt for the five years succeeding December 31,
1994 are $2,272 in 1995, $10,652 in 1996, $120,884 in 1997, $9,861 in 1998;
$9,612 in 1999 and $43,822 thereafter.

At December 31, 1994, certain loans ($7,900) were collateralized by
property and equipment.

Interest expense capitalized to property, plant and equipment was $244 in
1994, $71 in 1993 and $320 in 1992. Total interest paid was $17,400 in 1994,
$19,000 in 1993 and $17,500 in 1992. Weighted average interest rates on notes
payable to banks at December 31, 1994 and 1993 were 6.8% and 9.1%, respectively.

In 1992, the Company terminated an interest rate swap agreement with a
notional borrowing amount of $75,000 and received $2,586 which was amortized
($904 in 1994; $986 in 1993 and $696 in 1992) over the original swap term as a
yield adjustment to interest expense on the underlying $75,000 debt.

29
<PAGE> 30

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- CONTINUED

NOTE D -- SHORT-TERM AND LONG-TERM DEBT -- (CONTINUED)
In connection with the expansion of its motor plant, the Company received
in 1994 $6,000 of low interest rate loans from certain governmental entities.
The Company also received in 1994 $1,750 of government grants which were
recorded as a reduction in property, plant and equipment.

NOTE E -- INCOME TAXES

The components of income (loss) before income taxes and cumulative effect
of accounting change are as follows:

<TABLE>
<CAPTION>
1994 1993 1992
------- -------- --------
<S> <C> <C> <C>
U.S.................................................. $70,703 $ 43,345 $ 24,120
Non-U.S.............................................. 9,465 (90,295) (58,550)
------- -------- --------
Total...................................... $80,168 $(46,950) $(34,430)
======= ======== ========
</TABLE>

Components of income tax expense (benefit) are as follows:

<TABLE>
<CAPTION>
DEFERRED
LIABILITY METHOD METHOD
-------------------- --------
1994 1993 1992
-------- -------- --------
<S> <C> <C> <C>
Current:
Federal........................................... $ (8,379) $ 21,032 $ 8,295
Non-U.S........................................... 4,143 2,227 1,310
State and local................................... 4,534 2,828 1,227
-------- -------- --------
298 26,087 10,832
Deferred:
Federal........................................... 31,223 (32,980) 1,232
Non-U.S........................................... 639 479 (694)
-------- -------- --------
31,862 (32,501) 538
-------- -------- --------
Total..................................... $ 32,160 $ (6,414) $ 11,370
======== ======== ========
</TABLE>

The components of the provision for deferred income taxes for 1992 were as
follows:

<TABLE>
<S> <C>
Inventory adjustments....................................................... $ 201
Incentive equity plan....................................................... 87
Depreciation................................................................ 204
Other asset adjustments..................................................... (88)
Pension adjustments......................................................... (299)
Employee stock ownership plan............................................... (149)
Other....................................................................... 582
-----
Total............................................................. $ 538
=====
</TABLE>

30
<PAGE> 31

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- CONTINUED

NOTE E -- INCOME TAXES -- (CONTINUED)
The differences between total income tax expense (benefit) and the amount
computed by applying the statutory Federal income tax rate to income (loss)
before income taxes and cumulative effect of accounting change are as follows:

<TABLE>
<CAPTION>
DEFERRED
LIABILITY METHOD METHOD
------------------- --------
1994 1993 1992
------- -------- --------
<S> <C> <C> <C>
Statutory rate applied............................... 35% 35% 34%
to pre-tax income (loss)........................... $28,059 $(16,432) $(11,706)
Effect of state and local income taxes, net of
Federal tax benefit................................ 2,947 1,838 810
Differences in income taxes on non-U.S. earnings and
remittances........................................ (1,158) 336 (502)
Non-U.S. losses and unrecognized tax benefits........ 2,113 8,308 22,650
Foreign Sales Corporation............................ (838) (703) (630)
Other -- net......................................... 1,037 239 748
------- -------- --------
Total...................................... $32,160 $ (6,414) $ 11,370
======= ======== ========
</TABLE>

Total income tax payments, net of refunds, were $6,115 in 1994, $19,400 in
1993 and $16,500 in 1992.

At December 31, 1994, the Company's foreign subsidiaries have net operating
loss carryforwards of approximately $61,100 which expire in various years from
1995 through 2002, except for $5,000 for which there is no expiration date.

Significant components of the Company's deferred tax assets and liabilities
at December 31, 1994 and 1993, are as follows:

<TABLE>
<CAPTION>
1994 1993
-------- --------
<S> <C> <C>
Deferred tax assets:
Net operating loss carryforwards........................... $ 20,015 $ 15,709
Restructuring activities................................... 33,446
Inventory adjustments...................................... 3,274 2,772
Other accrual accounts..................................... 4,273 1,685
Employee benefits.......................................... 1,269 (172)
Other asset adjustments.................................... 3,350 3,245
Pension adjustments........................................ 2,417 2,085
Other deferred tax assets.................................. 2,844 7,406
-------- --------
37,442 66,176
Valuation allowance........................................ (18,987) (15,709)
-------- --------
18,455 50,467
Deferred tax liabilities:
Depreciation............................................... (8,136) $ (3,390)
Pension adjustments........................................ (2,690) (618)
Other deferred tax liabilities............................. (2,659) (9,627)
-------- --------
(13,485) (13,635)
-------- --------
Total.............................................. $ 4,970 $ 36,832
======== ========
</TABLE>

31
<PAGE> 32

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- CONTINUED

NOTE E -- INCOME TAXES -- (CONTINUED)
Income taxes currently payable amounted to approximately $10,100 and
$12,200 at December 31, 1994 and 1993, respectively.

The Company does not provide deferred income taxes on unremitted earnings
of foreign subsidiaries as such funds are deemed permanently reinvested to
finance foreign expansion and meet operational needs on an ongoing basis. Upon
distribution of those earnings in the form of dividends or otherwise, the
Company would be subject to both U.S. income taxes subject to an adjustment for
foreign tax credits and withholding taxes payable to the various foreign
countries. Determination of the amount of unrecognized deferred U.S. income tax
liability is not practicable because of the complexities associated with its
calculation; however, unrecognized non-U.S. tax credits and non-U.S. withholding
taxes paid upon distribution would be available to reduce some portion of the
U.S. liability.

NOTE F -- RETIREMENT ANNUITY AND GUARANTEED CONTINUOUS EMPLOYMENT PLANS

The Company and its subsidiaries maintain a number of defined benefit and
defined contribution plans to provide retirement benefits for their employees in
the United States as well as their employees in foreign countries. These plans
are maintained and contributions are made in accordance with the Employee
Retirement Income Security Act of 1974, local statutory law or as determined by
the Board of Directors. The plans generally provide benefits based upon years of
service and compensation. Pension costs accrued are funded except for the cost
associated with a supplemental employee retirement plan for certain key
employees.

A summary of the components of total pension expense is as follows:

<TABLE>
<CAPTION>
1994 1993 1992
-------- -------- --------
<S> <C> <C> <C>
U.S. Plans:
Service cost -- benefits earned during the year.......... $ 7,155 $ 6,115 $ 5,571
Interest cost on projected benefit obligation............ 19,601 18,158 17,207
Actual return on plan assets............................. (18,795) (19,569) (16,812)
Net amortization and deferral............................ (528) 1,441 (1,404)
-------- -------- --------
Net pension cost of defined benefit plans................ 7,433 6,145 4,562
Defined contribution plans............................... 258 193 225
-------- -------- --------
Total U.S. plans................................. 7,691 6,338 4,787
Non-U.S. Plans:
Service cost -- benefits earned during the year.......... 1,524 1,422 1,555
Interest cost on projected benefit obligation............ 2,207 2,253 2,472
Actual return on plan assets............................. (932) (4,506) (2,800)
Net amortization and deferral............................ (1,717) 2,000 289
-------- -------- --------
Net pension cost of defined benefit plans................ 1,082 1,169 1,516
Defined contribution plans............................... 702 1,326 905
-------- -------- --------
Total Non-U.S. plans............................. 1,784 2,495 2,421
-------- -------- --------
Total pension expense............................ $ 9,475 $ 8,833 $ 7,208
======== ======== ========
</TABLE>

32
<PAGE> 33

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- CONTINUED

NOTE F -- RETIREMENT ANNUITY AND GUARANTEED CONTINUOUS EMPLOYMENT
PLANS -- (CONTINUED)
The funded status of the U.S. and Non-U.S. plans at December 31, 1994 and
1993 is as follows:

<TABLE>
<CAPTION>
U.S. NON-U.S.
1994 1993 1994 1993
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Actuarial present value of accumulated benefit
obligations:
Vested..................................... $218,754 $222,588 $ 24,902 $ 23,881
Nonvested.................................. 9,797 8,463 881 1,136
-------- -------- -------- --------
$228,551 $231,051 $ 25,783 $ 25,017
======== ======== ======== ========
Actuarial present value of projected benefit
obligations................................... $258,661 $254,295 $ 29,020 $ 28,396
Plan assets at fair value....................... 243,802 228,014 32,272 28,191
-------- -------- -------- --------
Excess of projected benefit obligations over
plan assets................................... (14,859) (26,281) 3,252 (205)
Unrecognized net (gain) loss............... 155 13,788 (1,410) (1,593)
Unrecognized prior service cost............ 13,839 10,835 389 540
Unrecognized net assets at January 1, 1994
and 1993, net of amortization............ (2,910) (3,239) (1,519) (1,449)
Minimum Liability.......................... (2,183) (480) (351)
-------- -------- -------- --------
Accrued retirement annuity expense
recognized in the balance sheet.......... $ (5,958) $ (4,897) $ 232 $ (3,058)
======== ======== ======== ========
</TABLE>

The decrease in the actuarial present value of accumulated benefit
obligations ("ABO") for the U.S. plans is largely due to the change in the
discount rate from 7.5% to 8.25%, offset by the addition of a new non-qualified
Supplemental Executive Retirement Plan, as well as the normal one year's
additional accrual of benefit under all plans. In addition, the increase in the
ABO for the foreign plans is largely due to the restructuring of some of the
plans, as well as the normal one year's accrual of additional benefits, offset
by a change in the weighted average discount rate from 7.5% to 8.2% in 1994.

Assumptions used in accounting for the defined benefit plans as of December
31, 1994 and 1993 for both the U.S. and Non-U.S. plans were as follows:

<TABLE>
<CAPTION>
U.S. NON-U.S.
PLANS PLANS
------------- -------------
1994 1993 1994 1993
---- ---- ---- ----
<S> <C> <C> <C> <C>
Weighted-average discount rates............................... 8.25% 7.5 % 8.2 % 7.5 %
Projected rates of increase in compensation................... 5.50% 4.1 % 4.8 % 4.2 %
Expected rates of return on plan assets....................... 9.00% 9.0 % 8.5 % 9.1 %
</TABLE>

Plan assets for the U.S. plans consist principally of deposit
administration contracts and an investment contract with an insurance company.
Other assets held by the U.S. plans not under insurance contracts are invested
in equity and fixed income securities. Plan assets for the non-U.S. plans are
invested in non-U.S. insurance contracts and non-U.S. equity and fixed income
securities.

The Company does not have and does not provide for any postretirement or
postemployment benefits other than pensions.

33
<PAGE> 34

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- CONTINUED

NOTE F -- RETIREMENT ANNUITY AND GUARANTEED CONTINUOUS EMPLOYMENT
PLANS -- (CONTINUED)
The Cleveland, Ohio area operations have a Guaranteed Continuous Employment
Plan covering substantially all employees, which, in general, provides that the
Company will provide work for at least 75% of every standard work week
(presently 40 hours). This plan does not guarantee employment when the Company's
ability to continue normal operations is seriously restricted by events beyond
the control of the Company. The Company has reserved the right to terminate this
plan effective at the end of a calendar year by giving notice of such
termination not less than six months prior to the end of such year.

NOTE G -- INDUSTRY AND GEOGRAPHIC SEGMENT INFORMATION

The Company's primary business is the design, manufacture and sale, in the
domestic and international markets of arc and other welding products and related
gases used in the welding process. The Company also designs, manufactures and
sells integral horsepower industrial electric motors. Financial information by
geographic areas follows:

<TABLE>
<CAPTION>
UNITED OTHER
STATES EUROPE COUNTRIES ELIMINATIONS TOTAL
-------- -------- --------- ------------ --------
<S> <C> <C> <C> <C> <C>
1994:
Net sales to unaffiliated
customers................. $641,607 $156,803 $108,194 $ $906,604
Inter-geographic sales....... 40,876 10,558 7,060 (58,494) --
-------- -------- --------- ------------ --------
Total................ $682,483 $167,361 $115,254 $(58,494) $906,604
======== ======== ======== =========== ========
Pre-tax profit (loss)........ $ 71,650 $ 3,945 $ 5,520 $ (947) $ 80,168
Identifiable assets.......... 350,012 165,722 76,129 (35,006) 556,857
1993:
Net sales to unaffiliated
customers................. $543,458 $211,268 $ 91,273 $ $845,999
Inter-geographic sales....... 29,077 6,663 4,806 (40,546) --
-------- -------- --------- ------------ --------
Total................ $572,535 $217,931 $ 96,079 $(40,546) $845,999
======== ======== ======== =========== ========
Pre-tax profit (loss)........ $ 42,570 $(68,865) $(22,903 ) $ 2,248 $(46,950)
Identifiable assets.......... 389,247 172,136 69,871 (71,711) 559,543
1992:
Net sales to unaffiliated
customers................. $487,145 $275,520 $ 90,342 $ $853,007
Inter-geographic sales....... 30,466 6,811 4,944 (42,221) --
-------- -------- --------- ------------ --------
Total................ $517,611 $282,331 $ 95,286 $(42,221) $853,007
======== ======== ======== =========== ========
Pre-tax profit (loss)........ $ 24,860 $(52,828) $ (7,183 ) $ 721 $(34,430)
Identifiable assets.......... 294,730 246,457 86,839 (24,679) 603,347
</TABLE>

Intercompany sales between geographic regions are accounted for at prices
comparable to normal, customer sales and are eliminated in consolidation.

Export sales (excluding intercompany sales) from the United States were
$64,400 in 1994, $58,100 in 1993 and $67,100 in 1992.

34
<PAGE> 35

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- CONTINUED

NOTE H -- ACQUISITIONS

In June 1993, the Company purchased the outstanding minority interest in
its subsidiary in Spain for approximately $8,500. In January and May of 1992,
respectively, the Company purchased the remaining 29 percent interest in Lincoln
Norweld and a small Mexican company for an aggregate of $37,300. These
transactions were accounted for as purchases and their results of operations and
the increased interest in their results of operations, were included in the
consolidated statements of operations from the respective transaction dates.

NOTE I -- FAIR VALUES OF FINANCIAL INSTRUMENTS

The Company has various financial instruments, including cash, cash
equivalents and short and long-term debt. The Company has determined the
estimated fair value of these financial instruments by using available market
information and appropriate valuation methodologies which require judgment.
Accordingly, the use of different market assumptions or estimation methodologies
could have a material effect on the estimated fair value amounts. The Company
believes the carrying values of its financial instruments approximate their fair
value.

NOTE J -- OPERATING LEASES

The Company leases sales offices, warehouses, office equipment and data
processing equipment. Such leases, some of which are noncancellable, and in many
cases, include renewals, expire at various dates. The Company pays most
maintenance, insurance and tax expenses relating to leased assets. Rental
expense was $9,226 in 1994, $9,864 in 1993 and $9,840 in 1992.

At December 31, 1994, total minimum lease payments for noncancellable
operating leases are as follows:

<TABLE>
<S> <C>
1995 $ 8,624
1996 6,855
1997 4,626
1998 3,887
1999 2,723
Thereafter 4,176
-------
Total $30,891
=======
</TABLE>

NOTE K -- CONTINGENCIES

The Company and its subsidiaries are involved in various litigation in the
ordinary conduct of its business. Based on information known to the Company,
Management believes the outcome of all pending litigation will not have a
material effect upon the financial position of the Company.

35
<PAGE> 36

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- CONTINUED

NOTE L -- QUARTERLY FINANCIAL DATA (UNAUDITED)

<TABLE>
<CAPTION>
1994 MAR 31 JUN 30 SEP 30 DEC 31
--------------------------------------------- -------- -------- -------- ---------
<S> <C> <C> <C> <C>
Net sales.................................... $210,525 $234,173 $230,752 $ 231,154
Gross profit................................. 81,966 90,316 89,904 88,159
Income before income taxes................... 17,785 21,494 21,499 19,390(a)
Net income................................... 10,407 12,307 11,669 13,625(a)
Net income per share......................... $ 0.96 $ 1.12 $ 1.06 $ 1.24
</TABLE>

<TABLE>
<CAPTION>
1993 MAR 31 JUN 30 SEP 30 DEC 31
--------------------------------------------- -------- -------- -------- ---------
<S> <C> <C> <C> <C>
Net sales.................................... $211,168 $215,441 $209,173 $ 210,217
Gross profit................................. 79,756 79,415 80,300 73,733
Income (loss) before income taxes and
cumulative effect of accounting change..... 10,106 7,167 10,459 (74,682)(c)
Income (loss) before cumulative effect of
accounting change.......................... 4,806 995 3,706 (50,043)(c)
Net income (loss)............................ 7,274(b) 995 3,706 (50,043)(c)
Per share data:
Income (loss) before cumulative effect of
accounting change.......................... $ 0.44 $ 0.09 $ 0.34 $ (4.61)
Net income (loss)............................ $ 0.67 $ 0.09 $ 0.34 $ (4.61)

<FN>
---------------

(a) - Includes $2,500 of net adjustments to various expense accruals and $3,140
for the devaluation of the Mexican peso, offset partially by net favorable
inventory adjustments of $1,900 and adjustments to restructuring accruals
of $3,235. Also includes a favorable $2,000 adjustment to income taxes to
reflect the annual effective income tax rate.

(b) - The first quarter of 1993 includes an increase in net income of $2,468
($.23 per share) for the cumulative effect on prior years for a change in
accounting principle effective January 1, 1993.

(c) - Includes a $70,100 ($40,900 after tax or 3.77 per share) charge for
restructuring and other pretax adjustments of $6,365.

</TABLE>
36
<PAGE> 37

SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

(IN THOUSANDS OF DOLLARS)
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
COL. A COL. B COL. C COL. D COL. E
-----------------------------------------------------------------------------------------------------
ADDITIONS
(1)
CHARGED
BALANCE AT TO
BEGINNING COSTS (2) BALANCE
OF AND CHARGED TO OTHER NOTE A AT END OF
DESCRIPTION PERIOD EXPENSES ACCOUNTS-DESCRIBE DEDUCTIONS- PERIOD
--------------------------------- ---------- ------- ----------------- ----------- ---------
<S> <C> <C> <C> <C> <C>
Allowance for doubtful accounts:
Year ended December 31, 1994... $6,258 $ 995 $ 117(2) $ 3,119(1) $ 4,251
Year ended December 31, 1993... $5,434 $2,037 $ (723)(2) $ 490 $ 6,258
Year ended December 31, 1992... $4,720 $2,842 $ (1,450)(2) $ 678 $ 5,434

<FN>
---------------

(1) - Includes $2,480 relating to accounts written off during 1994 in connection
with the Company's restructuring activities.

(2) - FAS #52 adjustment.

Note A - Uncollectible accounts written-off, net of recoveries.

</TABLE>

37
<PAGE> 38

INDEX TO EXHIBITS

EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
------- ------------------------------------------------------------------
<S> <C>
3(a) Amended and Restated Articles of Incorporation of The Lincoln
Electric Company (filed as Exhibit 3(a) to Form 10-K of The
Lincoln Electric Company for the year ended December 31, 1993, SEC
File No. 0-1402 and incorporated herein by reference and made a
part hereof).
3(b) Amended and Restated Code of Regulations of The Lincoln Electric
Company filed herewith.
4(a) Note Agreement dated November 20, 1991 between The Prudential
Insurance Company of America and the Company (filed as Exhibit 4
to Form 10-K of The Lincoln Electric Company for the year ended
December 31, 1991, SEC File No. 0-1402 and incorporated by
reference and made a part hereof), as amended by letter dated
March 18, 1993; 8.98% Senior Note Due November 26, 2003 (filed as
Exhibit 4(a) to Form 10-K of The Lincoln Electric Company for the
year ended December 31, 1992, SEC File No. 0-1402 and incorporated
herein by reference and made a part hereof); as further amended by
letter dated as of November 19, 1993; 8.98% Senior Note Due
November 26, 2003 (filed as Exhibit 4(a) to Form 10K of The
Lincoln Electric Company for the year ended December 31, 1993, SEC
File No. 0-1402 and incorporated herein by reference and made a
part hereof), and as further amended by letter dated October 31,
1994 (filed as Exhibit 4(a) to Form 10Q of The Lincoln Electric
Company for the period ended September 30, 1994, SEC File No.
0-1402 and incorporated herein by reference and made a part
hereof).
4(b) Credit Agreement dated March 18, 1993 among the Company, the Banks
listed on the signature page thereof, and Society National Bank,
as Agent (filed as Exhibit 4(b) to Form 10-K of The Lincoln
Electric Company for the year ended December 31, 1992, SEC File
No. 0-1402 and incorporated herein by reference and made a part
hereof), as amended by Amendment No. 1 to Credit Agreement dated
November 19, 1993; 8.98% Senior Note Due November 26, 2003 (filed
as Exhibit 4(b) to Form 10K of The Lincoln Electric Company for
the year ended December 31, 1993, SEC File No. 0-1402 and
incorporated herein by reference and made a part hereof), and as
further amended by Amendment No. 2 to Credit Agreement dated
October 31, 1994 (filed as Exhibit 4(b) to Form 10Q of The Lincoln
Electric Company for the period ended September 30, 1994, SEC File
No. 0-1402 and incorporated herein by reference and made a part
hereof.)
9 Voting Trust Agreement filed herewith.
10(a) The Lincoln Electric Company 1988 Incentive Equity Plan (filed as
Exhibit 28 to the Form S-8 Registration Statement of The Lincoln
Electric Company, SEC File No. 33-25209 and incorporated herein by
reference and made a part hereof).
10(b) Form of Indemnification Agreement filed herewith.
10(c) Supplemental Executive Retirement Plan dated as of January 1,
1994.
10(d) The Lincoln Electric Company Deferred Compensation Plan dated as
of November 10, 1994.
10(e) Employment Agreement between the Company and Anthony A. Massaro
dated July 14, 1993, as amended on January 1, 1994.
</TABLE>

38
<PAGE> 39

EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
------- ------------------------------------------------------------------
<S> <C>
10(f) Employment Agreement between the Company and H. Jay Elliott dated
June 22, 1993.
10(g) Employment Agreement between the Company and Frederick G. Stueber
dated February 22, 1995.
10(h) Severance Agreement between the Company and Roger F. Young dated
August 11, 1994
10(i) Severance Agreement between the Company and John Gonzalez dated
November 22, 1994
11 Computation of earnings per share.
21 Subsidiaries of the Registrant.
23 Consents of Independent Auditors.
27 Financial Data Schedule.
</TABLE>

<PAGE> 1
EXHIBIT 3(b)

THE LINCOLN ELECTRIC COMPANY

AMENDED AND RESTATED
CODE OF REGULATIONS

ARTICLE I
---------

SHARES
------

1. Registration and Transfer of Certificates. Each shareholder of the
Corporation whose shares have been fully paid for shall be entitled to a
certificate or certificates showing the number of shares registered in his name
on the books of the Corporation. Each certificate shall be signed by the
Chairman of the Board or the President or Vice-President of the Corporation and
the Secretary or Assistant Secretary or the Treasurer or an Assistant Treasurer.
Shares shall be transferred only on the books of the Corporation by the holder
thereof, in person or by Attorney, upon surrender and cancellation of
certificates for a like number of shares.

2. Substituted Certificates. The Board of Directors may authorize the
issuance of a new certificate in place of any certificate theretofore issued by
the Corporation alleged to have been lost or destroyed; in its discretion
requiring the owner of the lost or destroyed certificate, or the legal
representative, to give the Corporation a bond in such sum as the Board of
Directors may direct as indemnity against any claim that may be made against the
Corporation; or, if in the judgment of the Board it is proper to do so, a new
certificate may be issued without requiring any bond.

3. Shareholders Entitled to Notice and to Vote. The Board of Directors may
fix a time not exceeding forty-five (45) days preceding the date of any meeting
of shareholders, or any dividend payment date, or any date for the allotment of
rights, as a record date for the determination of the shareholders entitled to
notice of such meeting, or to vote thereat, or to receive such dividends or
rights, as the case may be, or in lieu thereof, the Board of Directors may close
the books of the Corporation against the transfer of shares during the whole or
any part of such period.

ARTICLE II
----------

MEETINGS OF SHAREHOLDERS
------------------------

1. Annual Meeting. The Annual Meeting of shareholders shall be held on the
fourth Tuesday of the month of May each year at the principal office of the
Corporation, if not a legal holiday, and if a legal holiday, then on the next
day not a legal holiday, for the election of Directors and the consideration of
reports to be laid before the meeting. Upon due notice there may also be
considered and acted upon at the Annual Meeting any matter which can properly be
considered and acted upon at a special meeting, in which case and for which
purpose the Annual Meeting shall also be considered as, and shall be, a special
meeting. When an Annual Meeting is not held or Directors are not elected
thereat, they may be elected at a special meeting called for that purpose.

2. Special Meetings. Special meetings of the shareholders may be called by
the President, or a Vice-President, or the Chairman of the Board of Directors,
or by the Executive Committee, or by a majority of the Board of Directors,
acting with or without a meeting, or by persons who hold twenty-five percent of
all the shares outstanding and entitled to vote thereat, at such place or places
as may be designated in the call therefore, and notice thereof; provided,
however, that a meeting for the election of Directors may be held only within
the State of Ohio.

3. Notice of Meetings. Notice of meetings of shareholders shall be given
in writing by the Secretary, or in his absence by the Chairman of the Board or
President or a Vice-President, and such notice shall state the purpose or
purposes for which the meeting is called, and the time and place where it is to
be held, and shall be

2
<PAGE> 2

served or mailed to each shareholder of record entitled to vote at such meeting
or entitled to notice thereof, at least ten (10) days prior to the meeting. If
mailed, it shall be directed to the shareholder at his address as it appears
upon the records of the Corporation. In the event of the transfer of shares
after notice has been given and prior to the holding of the meeting, it shall
not be necessary to serve notice upon the transferee. Notice of the time, place
and purpose of any meeting of shareholders may be waived by the written assent
of every shareholder entitled to notice, filed with or entered upon the records
of the meeting, either before or after the holding thereof.

5. Quorum. The holders of a majority of the shares issued and outstanding,
entitled to vote, present either in person or by proxy, shall constitute a
quorum, unless a larger number is required by the laws of Ohio, in which case
the number required by the laws of Ohio, present either in person or by proxy,
shall constitute a quorum, but any less number may adjourn the meeting from time
to time, until a quorum is obtained, and no further notice of such adjourned
meeting need be given other than by announcement at the meeting at which such
adjournment is taken.

6. Proxies. Each shareholder entitled to vote shall be entitled to one
vote, either in person or by proxy, for each share of the Corporation standing
in his name at the time of the closing of the books for such meeting. No proxy
shall be valid after the expiration of eleven (11) months from the date thereof,
unless a longer time be specified therein. Proxies shall be in writing but need
not be sealed, witnessed or acknowledged and shall be filed with the Secretary
at or before the meeting.

ARTICLE III
-----------

BOARD OF DIRECTORS
------------------

1. Number and Election. The powers and authority of the Corporation shall
be exercised and its business managed and controlled by a Board of Directors.
The election of Directors shall be by ballot and shall be held at the Annual
Meeting of shareholders or at a special meeting called for that purpose. The
maximum number of the Directors of the Corporation shall be eighteen. Subject to
such maximum, the number of Directors may be fixed or changed (a) at a meeting
of the shareholders called for the purpose of electing Directors at which a
quorum is present, by the affirmative vote of the holders of a majority of the
shares that are represented at the meeting and entitled to vote on the proposal,
and (b) by the Directors, by the vote of a majority of their number, who may
also fill any Director's office that is created by an increase in the number of
Directors. The Directors shall be divided into three classes, as nearly equal in
number as possible, as determined by the Board of Directors of the Corporation.
A separate election shall be held for each class of Directors as hereinafter
provided. Directors elected at the first election for the first class shall hold
office for the term of one year from the date of their election and until the
election of their successors, Directors elected at the first election for the
second class shall hold office for the term of two years from the date of their
election and until the election of their successors, and Directors elected at
the first election for the third class shall hold office for the term of three
years from the date of their election and until the election of their
successors. At each annual election, the successors to the Directors of each
class whose terms shall expire in that year shall be elected to hold office for
the term of three years from the date of their election and until the election
of their successors. In case of any increase in the number of Directors of any
class, any additional Directors elected to such class shall hold office for a
term which shall coincide with the term of such class.

2. Vacancy and Removal. All Directors, for whatever terms elected, shall
hold office subject to applicable statutory provisions as to the creation of
vacancies and removal; provided, however, that all Directors, all the Directors
of a particular class or any individual Director may be removed from office,
without assigning any cause, only by the affirmative vote of the holders of at
least two-thirds of the voting power of the outstanding shares of stock entitled
to vote generally on the election of Directors.

3. Resignation. Any Director may resign at any time. Such resignation
shall be made in writing and shall take effect at the time specified therein. If
no time is specified, it shall become effective from the time of

3
<PAGE> 3

its receipt by the Corporation, and the Secretary shall record such resignation,
noting the day, hour and minute of its reception. The acceptance of a
resignation shall not be necessary to make it effective.

4. Meetings. Directors may meet at such times and at such places within or
without the State of Ohio as they may determine. A majority of the Board of
Directors shall be necessary to constitute a quorum for the transaction of
business, and the act of a majority of Directors present at a meeting at which a
quorum is present shall be the act of the Board of Directors.

5. By-Laws. The Board of Directors may adopt By-Laws for its own
government not inconsistent with the Articles of Incorporation or Regulations of
the Corporation.

ARTICLE IV
----------

INDEMNIFICATION AND INSURANCE
-----------------------------

1. Indemnification. (a) The Corporation shall indemnify any person who was
or is a party or is threatened to be made a party, to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that he is or was a Director, officer,
employee or agent of the corporation, or is or was serving at the request of the
Corporation as a Director, trustee, officer, employee or agent of another
corporation, domestic or foreign, nonprofit or for profit, partnership, joint
venture, trust or other enterprise, to the full extent permitted from time to
time under the laws of the State of Ohio; provided, however, that the
Corporation shall indemnify any such agent (as opposed to any Director, officer
or employee) of the Corporation to an extent greater than that required by law
only if and to the extent that the Directors may, in their discretion, so
determine.

(b) The indemnification authorized by this Article shall not be
exclusive of, and shall be in addition to, any other rights granted to
those seeking indemnification hereunder or under the Articles or any
agreement, vote of shareholders or disinterested Directors, or otherwise,
both as to action in his official capacity and as to action in another
capacity while holding such office, and shall continue as to a person who
has ceased to be a Director, trustee, officer, employee or agent and shall
inure to the benefit of the heirs, executors and administrators of such a
person.

(c) No amendment, termination or repeal of this Article IV shall
affect or impair in any way the rights of any Director or officer of the
Corporation to indemnification under the provisions hereof with respect to
any action, suit or proceeding arising out of, or relating to, any actions,
transactions or facts occurring prior to the final adoption of such
amendment, termination or repeal.

2. Liability Insurance. The Corporation may purchase and maintain
insurance or furnish similar protection, including but not limited to trust
funds, letters of credit or self-insurance, on behalf of or for any person who
is or was a Director, officer, employee or agent of the Corporation, or is or
was serving at the request of the Corporation as a Director, trustee officer,
employee or agent of another corporation, domestic or foreign, nonprofit or for
profit, partnership, joint venture, trust or other enterprise, against any
liability asserted against him and incurred by him in any such capacity, or
arising out of his status as such, whether or not the Corporation would have the
power to indemnify him against such liability under this Article. Insurance may
be purchased from or maintained with a person in which the Corporation has a
financial interest.

ARTICLE V
---------

NOMINATION OF DIRECTOR CANDIDATE
--------------------------------

1. Notification of Nominees. Nominations for the election of Directors may
be made by the Board of Directors or a committee appointed by the Board of
Directors or by any shareholder entitled to vote in the election of Directors
generally. However, any shareholder entitled to vote in the election of
Directors generally may nominate one or more persons for election as Directors
at a meeting only if written notice of such

4
<PAGE> 4

shareholder's intent to make such nomination or nominations has been received by
the Secretary of the Corporation not less than 80 days in advance of such
meeting; provided, however, that in the event that the date of the meeting was
not publicly announced by the Corporation by mail, press release or otherwise
more than 90 days prior to the meeting, notice by the shareholder to be timely
must be delivered to the Secretary of the Corporation not later than the close
of business on the tenth day following the day on which such announcement of the
date of the meeting was communicated to shareholders. Each such notice shall set
forth: (a) the name and address of the shareholder who intends to make the
nomination and of the person or persons to be nominated; (b) a representation
that the shareholder is a holder of record of stock of the Corporation entitled
to vote for the election of Directors on the date of such notice and intends to
appear in person or by proxy at the meeting to nominate the person or persons
specified in the notice; (c) a description of all arrangements or understandings
between the shareholder and each nominee and any other person or persons (naming
such person or persons) pursuant to which the nomination or nominations are to
be made by the shareholder; (d) such other information regarding each nominee
proposed by such shareholder as would be required to be included in a proxy
statement filed pursuant to the proxy rules of the Securities and Exchange
Commission, had the nominee been nominated, or intended to be nominated, by the
Board of Directors; and (e) the consent of each nominee to serve as a Director
of the Corporation if so elected.

2. Substitution of Nominees. In the event that a person is validly
designated as a nominee in accordance with paragraph 1 above, and shall
thereafter become unable or unwilling to stand for election to the Board of
Directors, the Board of Directors or the shareholder who proposed such nominee,
as the case may be, may designate a substitute nominee upon delivery, not fewer
than five days prior to the date of the meeting for the election of such nominee
of a written notice to the Secretary setting forth such information regarding
such substitute nominee as would have been required to be delivered to the
Secretary pursuant to paragraph 1 above had such substitute nominee been
initially proposed as a nominee. Such notice shall include a signed consent to
serve as a Director of the Corporation, if elected, of each such substitute
nominee.

3. Compliance with Procedures. If the chairman of the meeting for the
election of Directors determines that a nomination of any candidate for election
as a Director at such meeting was not made in accordance with the applicable
provisions of paragraphs 1 and 2 above, such nomination shall be void.

ARTICLE VI
----------

EXECUTIVE COMMITTEE
-------------------

1. Number and Election. The Board of Directors may elect from its own
number an Executive Committee consisting of three or more members. The Chairman
of the Board and the President shall be members of such committee and the
officer designated as Chief Executive Officer shall act as the Chairman thereof.
The Board of Directors shall fill vacancies in the Executive Committee by
election from the Directors and at all times it shall be the duty of the Board
of Directors to keep the membership of such committee full.

2. Powers of Executive Committee. During the intervals between the
meetings of the Board of Directors, the Executive Committee shall possess and
may exercise all of the powers of the Board of Directors, in the management of
the usual and ordinary affairs of the Corporation, subject, however, at all
times to the control and direction of the Board of Directors.

3. Quorum. A majority of the Executive Committee shall be necessary to
constitute a quorum and in every case the affirmative vote of a majority of the
members shall be necessary to pass any resolution. A resolution, in writing,
signed by all the members, shall be deemed the action of the Committee, although
not formally convened, and record thereof shall be kept in the record book of
the Committee under its proper date. The Committee shall keep a record of its
proceedings and shall fix its own rules.

5
<PAGE> 5

ARTICLE VII
-----------

OFFICERS
--------

1. Officers. The Directors shall, immediately after the adjournment of the
meeting of shareholders at which they were elected, or as soon thereafter as is
convenient, meet for organization and the election of officers, and for the
transaction of such other business as may come before the meeting. No notice of
such meeting shall be required. The Board of Directors shall, from its own
number, annually elect a President and may elect a Chairman of the Board, each
of whom shall hold office for one year and until their respective successors are
chosen and qualified, and shall designate either the Chairman of the Board or
the President as Chief Executive Officer of the Corporation. The Board of
Directors may also from time to time choose such other officers (who need not be
members of the Board) as it may deem necessary and fix the duties and authority
thereof. Any two or more offices may be held by the same person, but no officer
shall execute, acknowledge, or verify any instrument in more than one capacity,
if such instrument is required by law or by the Articles, the Regulations, or
the By-Laws to be executed, acknowledged, or verified by two or more officers.

2. Removal. The Board of Directors shall have the power, by a vote of
three-fourths of the entire membership of the Board, to remove any officer of
the Company and to fill any vacancy in any office for the unexpired term.

ARTICLE VIII
------------

DUTIES OF OFFICERS
------------------

1. Chairman of the Board. The Chairman of the Board, when such Chairman is
elected, when present, shall preside at meetings of Directors and shareholders
and perform such other duties as may be designated by the Board of Directors. If
designated by the Board of Directors as Chief Executive officer of the
Corporation he shall have general control and management of the affairs of the
Corporation, subject, however, to the direction and control of the Board of
Directors, and shall be an ex officio member of all standing committees of the
Board of Directors.

2. President. If designated by the Board of Directors as Chief Executive
Officer of the Corporation, the President shall have general control and
management of the affairs of the Corporation, subject, however, to the direction
and control of the Board of Directors, and shall be an ex officio member of all
standing committees of the Board of Directors. If not so designated, the
President shall have such duties as the Board of Directors or the Chief
Executive officer may from time to time prescribe. In the absence of the
Chairman of the Board, the President shall preside at meetings of Directors and
shareholders.

3. Vice President. In the absence or disability of the Chairman of the
Board, the President shall exercise the powers and perform the duties of the
Chairman of the Board and in the absence or disability of the President a Vice
President designated by the Board of Directors shall exercise the powers and
perform the duties of the President. Each Vice President shall perform such
other duties as shall from time to time be imposed upon him by the Chief
Executive Officer or the Board of Directors. The performance of any such duty by
any Vice President shall be conclusive evidence, to anyone dealing with the
Corporation, of his authority to act.

4. Secretary. The Secretary shall keep the minutes of the proceedings of
shareholders, Directors and committees and make proper record of the same, which
shall be attested by him. He shall keep such books as may be required by the
Board of Directors. He shall have charge of the seal, and until a Transfer Agent
or Agents is appointed for the shares of the Corporation, he shall have charge
of the certificate books of the Corporation, shall issue all certificates of
shares, shall keep a record thereof, and shall prepare and furnish lists thereof
when required by the Board of Directors, or at any meeting of shareholders. He
shall also perform such other duties as may be required of him by the Board of
Directors or Executive Committee.

6
<PAGE> 6

5. Treasurer. The Treasurer shall keep and maintain full and accurate
accounts of all receipts and disbursements of the Corporation. He shall prepare
and lay before shareholders such statements of profit and loss and such balance
sheets as are required to be laid before such meetings, and shall mail, on
request, a copy of such statement and balance sheet as required by law. He shall
deposit all monies, checks and other obligations to the credit of the
Corporation in such depositary or depositories as may be designated by the Board
of Directors, to be disbursed on signature of such officers and or agents as the
Board of Directors may designate. He shall render a statement of his accounts
and transactions whenever required by the Board of Directors, and generally
perform all duties incident to the office of Treasurer, subject to the control
of the Chief Executive Officer, and also perform such other duties as may be
required of him by the Chief Executive Officer or Board of Directors. In case
the Treasurer shall die, resign, retire or be removed from office, all books,
papers, vouchers, money and other property of whatsoever kind in his possession
or under his control belonging to the Corporation shall be delivered to the
Chief Executive Officer or as such Chief Executive officer may direct.

6. Surety Bonds. If required by the Board of Directors, any officer of the
Corporation shall give the Corporation a bond in such sum and with sureties
satisfactory to the Board for the faithful performance of the duties of his
office, the premium therefor to be paid by the Corporation.

7. Absence or Disability. In the absence or disability of any officer of
the Corporation, the Board of Directors may delegate his powers and duties to
any other executive officer or to any Director during such absence or
disability, and the person so delegated shall for the time being be the officer
whose powers and duties he so assumes.

ARTICLE IX
----------

COMPENSATION OF DIRECTORS AND OFFICERS
--------------------------------------

The compensation of the Directors and officers of the Corporation shall be
such as the Board of Directors may from time to time designate.

ARTICLE X
---------

AMENDMENTS
----------

These regulations may be altered, changed, amended or repealed by the
written consent of the holders of record of shares entitling them to exercise
not less than two-thirds of the voting power of the Corporation, or at a meeting
called and held for that purpose, by the affirmative vote of the holders of
record of shares entitling them to exercise not less than a majority of the
voting power of the Corporation; provided, however, that paragraphs 1 and 2 of
Article III and all of Article V shall not be altered, changed, amended or
repealed, nor shall any provision inconsistent with such provisions be adopted,
without the affirmative vote of the holders of record of shares entitling them
to exercise not less than two-thirds of the voting power of the Corporation
entitled to vote generally in the election of Directors.

<PAGE> 1

EXHIBIT 9

VOTING TRUST AGREEMENT

THIS VOTING TRUST AGREEMENT (the "Agreement"), made as of the 21st day of
July, 1988, by and among The Lincoln Electric Company, an Ohio corporation (the
"Company"), each individual who from time to time executes a form of this
Agreement and deposits Shares hereunder (each herein referred to as a
"Depositing Shareholder") and George E. Willis, Donald F. Hastings and Harry
Carlson (herein referred to collectively as the "Trustees"):

WITNESSETH:

WHEREAS, the Depositing Shareholders own beneficially and of record the
number of shares of Common Stock of the Company (the "Shares"), as indicated
next to the signature of each Depositing Shareholder at the end of this
Agreement, that each desires to make subject to the terms of this Agreement;

WHEREAS, all of the Shares are subject to the terms and conditions of The
Lincoln Electric Company Employees' Stock Purchase Plan, as amended (the
"Plan"), a copy of which is attached hereto as Exhibit A; and

WHEREAS, the Trustees have agreed to accept the obligations of voting
trustees under a statutory voting trust created pursuant to the provisions of
Section 1701.49 of the Ohio General Corporation Law.

NOW, THEREFORE, the parties hereto agree as follows:

1. DEPOSIT OF SHARES. For the purpose of vesting in the Trustees the
voting and consenting rights hereinafter specified, each Depositing Shareholder
shall, promptly after the execution of this Agreement, cause the certificate or
certificates for the Shares to be transferred upon the books of the Company and
a new certificate or certificates to be issued in lieu thereof registered in the
names of "George E. Willis, Donald F. Hastings and Harry Carlson, Trustees under
Voting Trust Agreement dated as of July 21, 1988 for Shares of The Lincoln
Electric Company" and shall promptly thereafter cause the new certificate or
certificates so issued to be deposited with the Company.

2. ISSUANCE OF VOTING TRUST CERTIFICATES. Upon the deposit of the
certificates for the Shares, the Company shall issue and deliver to each
Depositing Shareholder a Voting Trust Certificate for the Shares substantially
in the form, marked Exhibit B, which is attached hereto and made a part hereof.
Voting Trust Certificates issued hereunder and transferred in accordance with
Section 6 hereof may be transferred upon the books maintained by the Company at
its principal office by the registered holder of such Certificate in person or
by the duly authorized attorney of such registered holder, upon surrender
thereof, properly endorsed and payment of any requisite transfer tax, and upon
compliance with the terms and provisions of this Agreement and such rules and
regulations governing transfers as the Company may adopt. If any Voting Trust
Certificate is transferred upon the books of the Company, the Company shall
issue and deliver to the transferee another Voting Trust Certificate or
Certificates, in the form above-prescribed, for the Shares represented by the
Certificate surrendered. Until any Voting Trust Certificate is so transferred
upon the books of the Company, the Trustees and the Company may treat the
registered holder thereof, as shown by the books of the Company, as the absolute
and unqualified owner of such Certificate for all purposes, and shall not be
affected by any notice to the contrary. Voting Trust Certificates issued
hereunder shall in all respects be subject to the provisions of the laws of the
State of Ohio, and the Trustees and the Company shall have the same immunities
with respect thereto as are granted to a corporation with respect to its
securities by the provisions of Sections 1701.24 and 1701.28 of the Ohio General
Corporation Law and Chapter 1308 of the Ohio Revised Code.

3. POWER AND AUTHORITY OF TRUSTEES. Until the termination of this
Agreement, the Trustees shall possess and shall be entitled to exercise, in
their sole and absolute discretion, all the voting and consenting rights (but no
other rights) with respect to the Shares, including, without limitation of the
foregoing, the right to attend, in person or by proxy, any and all meetings of
the shareholders of the Company which may be held during the term of this
Agreement, to receive or waive any and all notices of shareholders' meetings, to
vote
<PAGE> 2

such Shares, either in person or by duly appointed proxy or agent, for the
election of Directors of the Company (including for the election of the Trustees
as Directors), and for or against any other matter, business or thing of
whatever nature that may be brought before any of said meetings or any
adjournments thereof, and to take or join in taking, without a meeting of
shareholders, any shareholders' action of any kind whatsoever; and no holder of
a Voting Trust Certificate issued hereunder, unless authorized by proxy issued
by the Trustees, shall have any right or power to exercise any of the foregoing
rights with respect to the Shares. The Trustees may vote the Shares hereunder in
the same manner as if they were the absolute owners thereof.

In taking any action pursuant to the terms of this Agreement, only the act
or action of at least a majority of the Trustees shall be deemed to be the act
or action of the Trustees, and the Company and the holders of the Voting Trust
Certificates issued hereunder shall be entitled to rely upon any such act or
action.

The Trustees may act as directors, officers or employees of the Company and
may be interested in or deal with the Company in the same manner as if they were
not Trustees hereunder. The Trustees shall receive no compensation for their
services hereunder. As used in this Agreement, the term "Trustees" means the
Trustees or any successor Trustees acting hereunder.

4. DIVIDENDS AND OTHER DISTRIBUTIONS. Except as otherwise provided in
Section 6 hereof, each holder of a Voting Trust Certificate shall possess and
shall be entitled to enjoy any and all rights of ownership with respect to the
Shares represented by such Voting Trust Certificate, other than the voting and
consenting rights expressly granted to the Trustees hereunder; but such rights
of ownership, and any Voting Trust Certificate issued hereunder, shall be held
subject to the provisions of this Agreement. Except as otherwise provided below,
any and all dividends and other distributions of any kind upon or with respect
to Shares represented by any Voting Trust Certificate issued hereunder shall be
distributed directly by the Company to the registered holder of such Voting
Trust Certificate as shown by the books of the Company on the record date fixed
by the Company with respect to each such dividend or other distribution.

In the event any Common Shares of the Company shall be distributed by the
Company upon or with respect to the Shares represented by any Voting Trust
Certificate issued hereunder, the Company shall issue a new certificate for such
shares registered in the name of the Trustees which shall be retained by the
Company, and shall issue and deliver an additional Voting Trust Certificate or
Certificates for such shares to the registered holder of the Voting Trust
Certificate upon which such distribution was made, as shown by the books of the
Company on the record date fixed by the Company with respect to such
distribution.

The Trustees hereby irrevocably authorize and direct the Company to make
the foregoing distributions directly to the registered holders of Voting Trust
Certificates, as hereinbefore provided. The Trustees agree to execute and
deliver to the Company from time to time any and all further dividend orders or
other documents, if any, which the Company may require in order to comply with
this provision.

5. IRREVOCABLE NATURE OF AGREEMENT; TERMINATION AND AMENDMENT. This
Agreement shall be irrevocable until the tenth anniversary date of this
Agreement, unless earlier terminated as provided herein. After such tenth
anniversary date, this Agreement may be revoked and terminated by each
Depositing Shareholder as to such Depositing Shareholder, or by the Trustees as
to any or all of the Depositing Shareholders, unless the term of the Agreement
has been extended as provided below.

This Agreement shall terminate automatically as to a Depositing Shareholder
upon the death of such person. This Agreement may also be terminated at any time
by an instrument or instruments executed by the Company, at least a majority of
the Trustees and by the Depositing Shareholder who so requests such termination
in respect of his/her Shares.

This irrevocable grant of rights in respect of the Shares as set forth
herein may be extended for additional periods of not more than ten years each
(measured from the date of extension) at any time by an instrument or
instruments executed by the Company, at least a majority of the Trustees and by
the beneficial owners of a majority of the Shares then deposited under this
Agreement.

<PAGE> 3

This Agreement may be amended from time to time by the Trustees in their
sole discretion, provided, however, that no amendment shall adversely affect,
without his/her consent, the rights of any Depositing Shareholder with respect
to the Shares deposited under this Agreement.

Upon any termination of this Agreement (through expiration, death of a
Depositing Shareholder or otherwise), the Company shall have the right and
option, within ninety (90) days from the date of termination, to purchase the
Shares that are subject to the particular terminating event and are represented
by the Voting Trust Certificate or Certificates issued hereunder in accordance
with the provisions of paragraph VIII of the Plan at a purchase price determined
in accordance with paragraph VII of the Plan. In the event a purchase occurs
upon the death of a Depositing Shareholder, the purchase price shall be payable
to the Executor of the Depositing Shareholder's estate or, at the Depositing
Shareholder's option, to any other person or persons designated by him/her in a
revocable writing delivered to the Company prior to his/her death (with the
instrument of latest date given effect).

Upon any termination of this Agreement (through expiration, death of the
Depositing Shareholder or otherwise) resulting in the purchase by the Company of
the Shares represented by the Voting Trust Certificate or Certificates issued
hereunder, or resulting in the release of any Shares from the operation of this
Agreement, the Company shall cause the Shares represented by each Voting Trust
Certificate to be transferred upon the books of the Company, or, in the case of
a release, to be so transferred into a certificate registered in the name of the
registered holder of such Voting Trust Certificate as shown by the books of the
Company on the date of any such release, and shall promptly thereafter cause
such certificates to be delivered to the Company, or, in the case of a release,
to be delivered to such registered holder; provided, however, that, in any
event, no Shares need be so transferred or no such certificate need be so
delivered unless and until the Voting Trust Certificate representing the same is
surrendered to the Company for cancellation and any requisite transfer tax on
the transfer of such Shares is paid. For the purpose of empowering the Company
to make such transfers of Shares, the registered holder of such Shares shall
deliver to the Company properly executed stock powers or assignments in blank
covering such Shares.

6. TRANSFERABILITY OF VOTING TRUST CERTIFICATES. No Depositing Shareholder
shall sell, assign, pledge, hypothecate, transfer or otherwise dispose of any
Voting Trust Certificate or Certificates until the Depositing Shareholder has
first complied with the provisions of paragraph VIII of the Plan (which provides
for the Company to have the right to purchase the Voting Trust Certificates and
the underlying Shares in the event of any intended or attempted transfer to a
third party). The Depositing Shareholder may, at any time, upon written notice
to the Company and each of the Trustees, offer to sell to the Company his Voting
Trust Certificate or Certificates and the underlying Shares.

Voting Trust Certificates transferred (to any person other than the
Company) pursuant to the terms of this Section 6 and paragraph VIII of the Plan
shall continue to be subject to the terms and conditions of this Agreement in
the hands of the transferee and in the hands of any subsequent Depositing
Shareholder.

7. DUTIES AND RESPONSIBILITIES OF THE COMPANY. The Company shall have no
duty to inquire into the acts of the Trustees hereunder, and shall be fully
protected in taking any action authorized or directed by the Trustees.

8. SUCCESSOR TRUSTEES. Any Trustee may be removed by the Board of
Directors of the Company at any time by delivery to said Trustee and to the
other Trustees written notice of such removal, effective on the date stated
therein. Any Trustee may at any time resign by delivering to the other Trustees
and to the Company his resignation in writing to take effect on the date stated
therein. In case of the death, resignation, removal or inability to act (through
mental or physical incapacity) of any Trustee, a successor Trustee shall be
appointed by the Board of Directors of the Company.

Any successor Trustee appointed in accordance with the foregoing shall from
the time of such appointment be deemed a Trustee hereunder, and shall have all
the title, rights and powers of a Trustee hereunder, and all acts shall be done
and all instruments shall be executed which shall be necessary or reasonably
requested for the purpose of effecting such succession and of constituting such
successor Trustee at the time of his or her appointment as one of the owners of
record of all of the Shares deposited hereunder.

<PAGE> 4

9. NOTICES. Any distribution to be made to the holders of Voting Trust
Certificates issued hereunder, or any communication addressed to such holders,
may be made by mailing the same, postage prepaid, to the registered holders of
such Certificates at their addresses as shown by the books of the Depositary at
the time of such mailing.

10. CHANGES IN STOCK REGISTRATION. The Company may, at any time or from
time to time, make such changes in the registration of the stock certificates
deposited hereunder as may be required to reflect amendments hereto or changes
in the Trustees hereunder.

11. LOST CERTIFICATES. Any person claiming a Voting Trust Certificate to
have been lost, stolen or destroyed shall furnish the Company with an affidavit
of that fact and a bond of indemnity satisfactory to the Company, whereupon a
new Voting Trust Certificate may be executed and delivered by the Company of the
same tenor and for the same number of Shares as the one alleged to have been
lost, stolen or destroyed.

12. COUNTERPARTS. This Agreement may be executed simultaneously in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same agreement.

13. GOVERNING LAW. This Agreement shall be construed in accordance with,
and governed by, the laws of the State of Ohio.

IN WITNESS WHEREOF, the Company, the Depositing Shareholders and the
Trustees have executed this Agreement all as of the day and year first above
written.

THE LINCOLN ELECTRIC COMPANY

By: ________________________________
George E. Willis,
Chairman of the Board and
Chief Executive Officer

DEPOSITING SHAREHOLDER
NUMBER OF SHARES:
----------------- --------------------------------

TRUSTEES

--------------------------------
George E. Willis

--------------------------------
Donald F. Hastings

--------------------------------
Harry Carlson

<PAGE> 5

THIS CERTIFICATE IS SUBJECT TO CERTAIN TRANSFER RESTRICTIONS AS SET FORTH
IN A CERTAIN VOTING TRUST AGREEMENT AMONG THE LINCOLN ELECTRIC COMPANY,
AND GEORGE E. WILLIS, DONALD F.
HASTINGS AND HARRY CARLSON, AS TRUSTEES, DATED AS OF JULY 21, 1988, AND AS SET
FORTH IN THE LINCOLN ELECTRIC COMPANY EMPLOYEES' STOCK PURCHASE PLAN, AS
AMENDED, COPIES OF WHICH ARE AVAILABLE FOR INSPECTION AT THE PRINCIPAL OFFICE OF
THE LINCOLN ELECTRIC COMPANY.

(Front Side of Certificate)

No. Shares
----------------------- -------------------
THE LINCOLN ELECTRIC COMPANY

(An Ohio corporation)

VOTING TRUST CERTIFICATE

This evidences that
is the owner of
Shares of Common Stock, without par value, of The Lincoln Electric
Company, an Ohio corporation, and held by the undersigned subject and pursuant
to the terms and conditions of (i) a Voting Trust Agreement for Stock of The
Lincoln Electric Company dated July 21, 1988, among The Lincoln Electric
Company, George E. Willis, Donald F. Hastings, and Harry Carlson, as Trustees,
and , as Depositing Shareholder (the "Voting Trust
Agreement"), and (ii) The Lincoln Electric Company Employees' Stock Purchase
Plan, as amended (the "Plan"), and will be entitled to receive a certificate or
certificates for such shares upon the termination of such Voting Trust
Agreement, and upon surrender of this Certificate and payment of any requisite
transfer tax.

This Certificate is subject to certain transfer restrictions set forth in
Sections 5 and 6 of the Voting Trust Agreement and paragraph VIII of the Plan.
Certificates transferred in accordance with those provisions may be transferred
upon the books of the Company at its principal office by the registered holder
in person or by his duly authorized representative upon surrender of this
Certificate properly endorsed and payment of any requisite transfer tax and upon
compliance with the terms and provisions of the aforesaid Voting Trust Agreement
and the Plan and such rules and regulations governing transfers as the Company
may adopt. Until this Certificate is so transferred upon the books of the
Company, the Trustees and the Company may treat the registered holder hereof as
the absolute and unqualified owner of this Certificate for all purposes, and
shall not be affected by any notice to the contrary.

The registered holder of this Certificate and any transferee hereof shall
take and hold this Certificate subject to all the terms and conditions of the
aforesaid Voting Trust Agreement and the Plan, reference to each of which is
hereby made. Copies of such Agreement and such Plan are on file at the principal
office of the Company, where they may be inspected, during usual business hours,
by the registered Depositing Shareholder hereof or by any person duly authorized
by him.

IN WITNESS WHEREOF, the undersigned has executed this Certificate at
Cleveland, Ohio, this day of
, 19 .

THE LINCOLN ELECTRIC COMPANY

By
--------------------------------

<PAGE> 1
EXHIBIT 10(b)

INDEMNIFICATION AGREEMENT

This Indemnification Agreement ("Agreement") is made as of the day of
, 19 , by and between The Lincoln Electric Company, an
Ohio corporation (the "Company"), and
(the "Indemnitee"), an Officer of
the Company.

RECITALS

A. The Indemnitee is presently serving as an Officer of the Company and the
Company desires the Indemnitee to continue in that capacity. The Indemnitee
is willing, subject to certain conditions, including, without limitation, the
execution and performance of this Agreement by the Company, to continue in
that capacity.

B. In addition to the indemnification to which the Indemnitee is entitled under
the Code of Regulations, as amended, of the Company (the "Regulations"), the
Company has obtained, at its sole expense, insurance protecting the Company
and its officers and directors including the Indemnitee against certain
losses arising out of actual or threatened actions, suits or proceedings to
which such persons may be made or threatened to be made parties. However, as
a result of circumstances having no relation to, and beyond the control of,
the Company and the Indemnitee, there can be no assurance of the continuation
or renewal of that insurance, and the additional protection offered by this
Agreement is therefore appropriate.

Accordingly, and in order to induce the Indemnitee to continue to serve in
his present capacity, the Company and the Indemnitee agree as follows:

1. CONTINUED SERVICE. The Indemnitee shall continue to serve at the will
of the Company as an Officer of the Company so long as he is duly
elected and qualified in accordance with the Regulations or until he
resigns in writing in accordance with applicable law.

2. INITIAL INDEMNITY. (a) The Company shall indemnify the Indemnitee, if
or when he is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative (other than an action
by or in the right of the Company), by reason of the fact that he is or
was an Officer of the Company or is or was serving at the request of
the Company as a director, trustee, officer, employee or agent of
another corporation, domestic or foreign, nonprofit or for profit,
partnership, joint venture, trust or other enterprise, or by reason of
any action alleged to have been taken or omitted in any such capacity,
against any and all costs, charges, expenses (including without
limitation fees and expenses of attorneys and/or others; all such
costs, charges and expenses being herein jointly referred to as
"Expenses"), judgments, fines and amounts paid in settlement, actually
and reasonably incurred by the Indemnitee in connection therewith
including any appeal of or from any judgment or decision, unless it is
proved by clear and convincing evidence in a court of competent
jurisdiction that the Indemnitee's action or failure to act involved an
act or omission undertaken with deliberate intent to cause injury to
the Company or undertaken with reckless disregard for the best
interests of the Company. In addition, with respect to any criminal
action or proceeding, indemnification hereunder shall be made only if
the Indemnitee had no reasonable cause to believe his conduct was
unlawful. The termination of any action, suit or proceeding by
judgment, order, settlement or conviction, or upon a plea of "nolo
contendere" or its equivalent, shall not, of itself, create a
presumption that the Indemnitee did not satisfy the foregoing standard
of conduct to the extent applicable thereto.

(b) The Company shall indemnify the Indemnitee, if or when he is a
party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding by or in the right
of the Company to procure a judgment in its favor, by reason of the
fact that the Indemnitee is or was an officer of the Company or is
or was serving at the request of the Company as a director,
trustee, officer, employee or agent of another corporation,
domestic or foreign, nonprofit or for profit, partnership, joint
venture, trust or other enterprise, against any
<PAGE> 2

and all Expenses actually and reasonably incurred by the Indemnitee
in connection with the defense or settlement thereof or any appeal
of or from any judgment or decision, unless it is proved by clear
and convincing evidence in a court of competent jurisdiction that
the Indemnitee's action or failure to act involved an act or
omission undertaken with deliberate intent to cause injury to the
Company or undertaken with reckless disregard for the best
interests of the Company, except that no indemnification shall be
made in respect of any action or suit in which the only liability
asserted against the Indemnitee is pursuant to Section 1701.95 of
the Ohio Revised Code (the "ORC").

(c) Any indemnification under Section 2(a) or 2(b) (unless ordered by a
court) shall be made by the Company only as authorized in the
specific case upon a determination that indemnification of the
Indemnitee is proper in the circumstances because he has met the
applicable standard of conduct set forth in Section 2(a) or 2(b).
Such authorization shall be made (i) by the Officers of the Company
(the "Board") by a majority vote of a quorum consisting of Officers
who were not and are not parties to or threatened with such action,
suit or proceeding, or (ii) if such a quorum of disinterested
Officers is not available or if a majority of such quorum so
directs, in a written opinion by independent legal counsel
(designated for such purpose by the Board) which shall not be an
attorney, or a firm having associated with it an attorney, who has
been retained by or who has performed services for the Company, or
any person to be indemnified, within the five years preceding such
determination, or (iii) by the shareholders of the Company (the
"Shareholders"), or (iv) by the court in which such action, suit or
proceeding was brought.

(d) To the extent that the Indemnitee has been successful on the merits
or otherwise, including without limitation the dismissal of an
action without prejudice, in defense of any action, suit or
proceeding referred to in Section 2(a) or 2(b), or in defense of any
claim, issue or matter therein, he shall be indemnified against
Expenses actually and reasonably incurred by him in connection
therewith. Expenses actually and reasonably incurred by the
Indemnitee in defending any such action, suit or proceeding shall be
paid by the Company as they are incurred in advance of the final
disposition of such action, suit or proceeding under the procedure
set forth in Section 4(b) hereof.

(e) For purposes of this Agreement, references to "other enterprises"
shall include employee benefit plans; references to "fines" shall
include any excise taxes assessed on the Indemnitee with respect to
any employee benefit plan; references to "serving at the request of
the Company" shall include any service as a director, officer,
employee or agent of the Company which imposes duties on, or
involves services by, the Indemnitee with respect to an employee
benefit plan, its participants or beneficiaries; references to the
masculine shall include the feminine; and references to the singular
shall include the plural and vice versa.

3. ADDITIONAL INDEMNIFICATION. Pursuant to Section 1701.13(E)(6) of the
ORC, without limiting any right which the Indemnitee may have pursuant
to Section 2 hereof or any other provision of this Agreement or the
Articles of Incorporation, as amended, of the Company (the "Articles"),
the Regulations, the ORC, any policy of insurance or otherwise, but
subject to any limitation on the maximum permissible indemnity which
may exist under applicable law at the time of any request for indemnity
hereunder and subject to the following provisions of this Section 3,
the Company shall indemnify the Indemnitee against any amount which he
is or becomes obligated to pay relating to or arising out of any claim
made against him because of an act, failure to act or neglect or breach
of duty, including any actual or alleged error, misstatement or
misleading statement, which he commits, suffers, permits or acquiesces
in while acting in his capacity as an officer of the Company. The
payments which the Company is obligated to make pursuant to this
Section 3 shall include, without limitation, judgments, fines and
amounts paid in settlement and any and all Expenses actually and
reasonably incurred by the Indemnitee in connection therewith including
any appeal of or from any judgment or decision; provided, however, that
the Company shall not be obligated under this Section 3 to make any
payment in connection with any claim against the Indemnitee:

A-2
<PAGE> 3

(a) to the extent of any fine or similar governmental imposition which
the Company is prohibited by applicable law from paying which
results from a final, nonappealable order; or

(b) to the extent based upon or attributable to the Indemnitee having
actually realized a personal gain or profit to which he was not
legally entitled, including without limitation profit from the
purchase and sale by the Indemnitee of equity securities of the
Company which are recoverable by the Company pursuant to Section
16(b) of the Securities Exchange Act of 1934, or profit arising from
transactions in publicly traded securities of the Company which were
effected by the Indemnitee in violation of Section 10(b) of the
Securities Exchange Act of 1934, or Rule l0b-5 promulgated
thereunder.

A determination as to whether the Indemnitee shall be entitled to
indemnification under this Section 3 shall be made in accordance with
Section 4(a) hereof. Expenses incurred by the Indemnitee in defending any
claim to which this Section 3 applies shall be paid by the Company as they
are actually and reasonably incurred in advance of the final disposition of
such claim under the procedure set forth in Section 4(b) hereof.

4. CERTAIN PROCEDURES RELATING TO INDEMNIFICATION. (a) For purposes of
pursuing his rights to indemnification under Section 3 hereof, the
Indemnitee shall (i) submit to the Board a sworn statement of request
for indemnification substantially in the form of Exhibit 1 attached
hereto and made a part hereof (the "Indemnification Statement")
averring that he is entitled to indemnification hereunder; and (ii)
present to the Company reasonable evidence of all amounts for which
indemnification is requested. Submission of an Indemnification
Statement to the Board shall create a presumption that the Indemnitee
is entitled to indemnification hereunder, and the Company shall, within
sixty (60) calendar days after submission of the Indemnification
Statement, make the payments requested in the Indemnification Statement
to or for the benefit of the Indemnitee, unless (i) within such
60-calendar-day period the Board shall resolve by vote of a majority of
the Officers at a meeting at which a quorum is present that the
Indemnitee is not entitled to indemnification under Section 3 hereof,
(ii) such vote shall be based upon clear and convincing evidence
(sufficient to rebut the foregoing presumption) and (iii) the
Indemnitee shall have received within such period notice in writing of
such vote, which notice shall disclose with particularity the evidence
upon which the vote is based. The foregoing notice shall be sworn to by
all persons who participated in the vote and voted to deny
indemnification. The provisions of this Section 4(a) are intended to be
procedural only and shall not affect the right of Indemnitee to
indemnification under Section 3 of this Agreement so long as Indemnitee
follows the prescribed procedure, and any determination by the Board
that Indemnitee is not entitled to indemnification and any failure to
make the payments requested in the Indemnification Statement shall be
subject to judicial review by any court of competent jurisdiction.

(b) For purposes of obtaining payments of Expenses in advance of final
disposition pursuant to the second sentence of Section 2(d) or the
last sentence of Section 3 hereof, the Indemnitee shall submit to
the Company a sworn request for advancement of Expenses
substantially in the form of Exhibit 2 attached hereto and made a
part hereof (the "Undertaking"), averring that he has reasonably
incurred actual Expenses in defending an action, suit or proceeding
referred to in Section 2(a) or 2(b) or any claim referred to in
Section 3, or pursuant to Section 7 hereof. Unless at the time of
the Indemnitee's act or omission at issue, the Articles or
Regulations of the Company prohibit such advances by specific
reference to ORC Section 1701.13(E)(5)(a) and unless the only
liability asserted against the Indemnitee in the subject action,
suit or proceeding is pursuant to ORC Section 1701.95, the
Indemnitee shall be eligible to execute Part A of the Undertaking by
which he undertakes to (a) repay such amount if it is proved by
clear and convincing evidence in a court of competent jurisdiction
that the Indemnitee's action or failure to act involved an act or
omission undertaken with deliberate intent to cause injury to the
Company or undertaken with reckless disregard for the best interests
of the Company and (b) reasonably cooperate with the Company
concerning the action, suit, proceeding or claim. In all cases, the
Indemnitee shall be eligible to execute Part B of the Undertaking by
which he undertakes to repay such amount if it ultimately is
determined that he is not entitled to be

A-3
<PAGE> 4

indemnified by the Company under this Agreement or otherwise. In the
event that the Indemnitee is eligible to and does execute both Part A
and Part B of the Undertaking, the Expenses which are paid by the
Company pursuant thereto shall be required to be repaid by the
Indemnitee only if he is required to do so under the terms of both
Part A and Part B of the Undertaking. Upon receipt of the Undertaking,
the Company shall thereafter promptly pay such Expenses of the
Indemnitee as are noticed to the Company in writing and in reasonable
detail arising out of the matter described in the Undertaking. No
security shall be required in connection with any Undertaking.

5. LIMITATION ON INDEMNITY. Notwithstanding anything contained herein to
the contrary, the Company shall not be required hereby to indemnify the
Indemnitee with respect to any action, suit or proceeding that was
initiated by the Indemnitee unless (i) such action, suit or proceeding
was initiated by the Indemnitee to enforce any rights to
indemnification arising hereunder and such person shall have been
formally adjudged to be entitled to indemnity by reason hereof, (ii)
authorized by another agreement to which the Company is a party whether
heretofore or hereafter entered or (iii) otherwise ordered by the court
in which the suit was brought.

6. SUBROGATION; DUPLICATION OF PAYMENTS. (a) In the event of payment
under this Agreement, the Company shall be subrogated to the extent of
such payment to all of the rights of recovery of the Indemnitee, who
shall execute all papers required and shall do everything that may be
necessary to secure such rights, including the execution of such
documents necessary to enable the Company effectively to bring suit to
enforce such rights.

(b) The Company shall not be liable under this Agreement to make any
payment in connection with any claim made against the Indemnitee to
the extent the Indemnitee has actually received payment (under any
insurance policy, the Company's Regulations or otherwise) of the
amounts otherwise payable hereunder.

7. FEES AND EXPENSES OF ENFORCEMENT. It is the intent of the Company that
the Indemnitee not be required to incur the expenses associated with
the enforcement of his rights under this Agreement by litigation or
other legal action because the cost and expense thereof would
substantially detract from the benefits intended to be extended to the
Indemnitee hereunder. Accordingly, if it should appear to the
Indemnitee that the Company has failed to comply with any of its
obligations under this Agreement or in the event that the Company or
any other person takes any action to declare this Agreement void or
unenforceable, or institutes any action, suit or proceeding to deny, or
to recover from, the Indemnitee the benefits intended to be provided to
the Indemnitee hereunder, the Company irrevocably authorizes the
Indemnitee from time to time to retain counsel of his choice, at the
expense of the Company as hereafter provided, to represent the
Indemnitee in connection with the initiation or defense of any
litigation or other legal action, whether by or against the Company or
any director, officer, shareholder or other person affiliated with the
Company, in any jurisdiction. Regardless of the outcome thereof, the
Company shall pay and be solely responsible for any and all costs,
charges and expenses, including without limitation fees and expenses of
attorneys and others, reasonably incurred by the Indemnitee pursuant to
this Section 7.

8. MERGER OR CONSOLIDATION. In the event that the Company shall be a
constituent corporation in a consolidation, merger or other
reorganization, the Company, if it shall not be the surviving,
resulting or acquiring corporation therein, shall require as a
condition thereto that the surviving, resulting or acquiring
corporation agree to assume all of the obligations of the Company
hereunder and to indemnify the Indemnitee to the full extent provided
herein. Whether or not the Company is the resulting, surviving or
acquiring corporation in any such transaction, the Indemnitee shall
also stand in the same position under this Agreement with respect to
the resulting, surviving or acquiring corporation as he would have with
respect to the Company if its separate existence had continued.

9. NONEXCLUSIVITY AND SEVERABILITY. (a) The rights to indemnification
provided by this Agreement shall not be exclusive of any other rights
of indemnification to which the Indemnitee may be entitled under the
Articles, the Regulations, the ORC or any other statute, any insurance
policy, agreement

A-4
<PAGE> 5

or vote of shareholders or directors or otherwise, as to any actions or
failures to act by the Indemnitee, and shall continue after he has ceased
to be a Director, officer, employee or agent of the Company or other
entity for which his service gives rise to a right hereunder, and shall
inure to the benefit of his heirs, executors and administrators.

(b) If any provision of this Agreement or the application of any
provision hereof to any person or circumstances is held invalid,
unenforceable or otherwise illegal, the remainder of this Agreement
and the application of such provision to other persons or
circumstances shall not be affected, and the provision so held to
be invalid, unenforceable or otherwise illegal shall be reformed to
the extent (and only to the extent) necessary to make it
enforceable, valid and legal.

10. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Ohio, without giving effect to
the principles of conflict of laws thereof.

11. MODIFICATION. This Agreement and the rights and duties of the
Indemnitee and the Company hereunder may be modified only by an
instrument in writing signed by both parties hereto.

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the date first above written.

THE LINCOLN ELECTRIC COMPANY

By
-------------------------------
Donald F. Hastings
Chairman and
Chief Executive Officer

By
-------------------------------

A-5
<PAGE> 6

EXHIBIT 1

INDEMNIFICATION STATEMENT

STATE OF
SS
COUNTY OF

I, , being first duly sworn, do depose and
say as follows:

1. This Indemnification Statement is submitted pursuant to the
Indemnification Agreement, dated , 19 ,
between The Lincoln Electric Company (the "Company"), an Ohio
corporation, and the undersigned.

2. I am requesting indemnification against costs, charges, expenses (which
may include fees and expenses of attorneys and/or others), judgments,
fines and amounts paid in settlement (collectively, "Liabilities"),
which have been actually and reasonably incurred by me in connection
with a claim referred to in Section 3 of the aforesaid Indemnification
Agreement.

3. With respect to all matters related to any such claim, I am entitled to
be indemnified as herein contemplated pursuant to the aforesaid
Indemnification Agreement.

4. Without limiting any other rights which I have or may have, I am
requesting indemnification against Liabilities which have or may arise
out of ________________________________________________________________
_______________________________________________________________________
_______________________________________________________________________

------------------------------------
(Signature of Indemnitee)

Subscribed and sworn to before me, a Notary Public in and for said County and
State, this day of , 19 .

[SEAL]

------------------------------------

My commission expires the day of , 19 .
<PAGE> 7

EXHIBIT 2

UNDERTAKING

STATE OF
SS
COUNTY OF

I, being first duly sworn, do depose and say
as follows:

1. This Undertaking is submitted pursuant to the Indemnification Agreement,
dated , 19 , between The Lincoln Electric Company
(the "Company"), an Ohio corporation, and the undersigned.

2. I am requesting payment of costs, charges and expenses which I have
reasonably incurred or will reasonably incur in defending an action, suit or
proceeding, referred to in Section 2(a) or 2(b) or any claim referred to in
Section 3, or pursuant to Section 7, of the aforesaid Indemnification
Agreement.

3. The costs, charges, and expenses for which payment is requested are, in
general, all expenses related to

4. PART A

I hereby undertake to (a) repay all amounts paid pursuant hereto if it is proved
by clear and convincing evidence in a court of competent jurisdiction that my
action or failure to act which is the subject of the matter described herein
involved an act or omission undertaken with deliberate intent to cause injury to
the Company or undertaken with reckless disregard for the best interests of the
Company and (b) reasonably cooperate with the Company concerning the action,
suit, proceeding or claim.

------------------------------------
(Signature of Indemnitee)

PART B

I hereby undertake to repay all amounts paid pursuant hereto if it ultimately is
determined that I am not entitled to be indemnified by the Company under the
aforesaid Indemnification Agreement or otherwise.

------------------------------------
(Signature of Indemnitee)

Subscribed and sworn to before me, a Notary Public in and for said County and
State, this day of , 19 .

[SEAL]

------------------------------------

My commission expires the day of , 19 .

<PAGE> 1
EXHIBIT 10(c)
ERNST & YOUNG PHONE: 216 861 5000
HUMAN REOURCE
FAX: 216 861 8131
CONSULTING SERVICES
1300 HUNTINGTON BUILDING
925 EUCLID AVENUE
CLEVELAND, OHIO 44115-1405

February 22, 1995

Mr. Harry Carlson
Vice Chairman
The Lincoln Electric Company
22801 St. Clair Avenue
Cleveland, Ohio 44117-1199

The Lincoln Electric Company
Supplemental Executive Retirement Plan

Dear Harry:

Enclosed in final form is The Lincoln Electric Company Supplemental
Executive Retirement Plan (the "SERP"), with changes made to reflect a "Normal
Retirement Date" based on attainment of age 60, and clarification of the "Social
Security Benefit" definition and its calculation relative to early retirements.
These changes and the draft document have been reviewed with John Cornell of
JDR&P and accepted, with such changes marked for your reference from the prior
draft dated December 5, 1994.

Please call me with any further comments or questions regarding these
matters.

Yours truly yours,

/s/ Thomas J. Laubenthal
---------------------------
Thomas J. Laubenthal
Partner

Enclosures
Copy to Mr. Donald F. Hastings
Mr. H. Jay Elliot
Mr. David H. Gunning, Capital American Financial Corporation
Mr. John R. Cornell, JDR&P
Mr. G. Russell Lincoln
Mr. Robert N. Gudbranson
Mr. Philip Katzan, The Wyatt Company
<PAGE> 2

THE LINCOLN ELECTRIC COMPANY
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
<PAGE> 3

THE LINCOLN ELECTRIC COMPANY
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

<TABLE>
<CAPTION>
TABLE OF CONTENTS PAGE
----------------------------------------------------------------------------- ----
<S> <C> <C> <C>
ARTICLE I -- GENERAL
Section 1.1 Effective Date................................................. 1
Section 1.2 Intent......................................................... 1
ARTICLE II -- DEFINITIONS AND USAGE
Section 2.1 Definitions.................................................... 1
Section 2.2 Usage.......................................................... 4
ARTICLE III -- ELIGIBILITY AND PARTICIPATION
Section 3.1 Eligibility.................................................... 4
Section 3.2 Participation.................................................. 4
ARTICLE IV -- RETIREMENT BENEFIT
Section 4.1 Retirement Benefit............................................. 5
Section 4.2 Early Retirement Benefit....................................... 5
Section 4.3 Vesting........................................................ 6
Section 4.4 Other Retirement Benefits...................................... 6
ARTICLE V -- PAYMENT OF RETIREMENT BENEFIT
Section 5.1 Payment of Retirement Benefits................................. 6
Section 5.2 Form of Retirement Benefits.................................... 7
Section 5.3 Payment Procedure.............................................. 7
ARTICLE VI -- PAYMENT OF BENEFIT ON OR AFTER DEATH OR DISABILITY
Section 6.1 Commencement of Benefit Payments............................... 7
Section 6.2 Designation of Beneficiary..................................... 8
ARTICLE VII -- ADMINISTRATION
Section 7.1 General........................................................ 8
Section 7.2 Administrative Rules........................................... 8
Section 7.3 Duties......................................................... 8
Section 7.4 Fees........................................................... 9
Section 7.5 Limitation of Actions.......................................... 9
ARTICLE VIII- CLAIMS PROCEDURE
Section 8.1 General........................................................ 9
Section 8.2 Denials........................................................ 9
Section 8.3 Appeals Procedure.............................................. 10
Section 8.4 Review......................................................... 10
ARTICLE IX -- MISCELLANEOUS PROVISIONS
Section 9.1 Amendment and Termination...................................... 10
Section 9.2 No Assignment.................................................. 10
Section 9.3 Successors and Assigns......................................... 11
Section 9.4 Governing Law.................................................. 11
Section 9.5 No Guarantee of Employment..................................... 11
Section 9.6 Severability................................................... 11
Section 9.7 Notification of Addresses...................................... 11
Section 9.8 Bonding........................................................ 11
Section 9.9 Withdrawal of Employer......................................... 11
ARTICLE X -- FUNDING................................................................... 12
</TABLE>
<PAGE> 4

THE LINCOLN ELECTRIC COMPANY
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

PREAMBLE

WHEREAS, The Lincoln Electric Company (the "Company") has established one
or more qualified retirement plans that place limitations on the amount of
retirement benefits available to certain key management or highly compensated
employees; and

WHEREAS, the Company recognizes the unique qualifications of such employees
and the valuable services they provide and desires to establish an unfunded plan
to provide retirement benefits to eligible key employees that supplement what is
available under such qualified plans and Social Security; and

WHEREAS, the Company has determined that the implementation of such a plan
will best serve its interest in retaining key employees and ensuring benefit
equity among all employees;

NOW, THEREFORE, the Company hereby establishes The Lincoln Electric Company
Supplemental Executive Retirement Plan as hereinafter provided:

ARTICLE I

GENERAL

Section 1.1 Effective Date. This Plan shall be effective as of January 1,
1994. The rights, if any, of any person whose status as an employee of an
Employer has terminated shall be determined pursuant to the Plan as in effect on
the date such employee terminated, unless a subsequently adopted provision of
the Plan is made specifically applicable to such person.

Section 1.2 Intent. The Plan is intended to be an unfunded plan primarily
for the purpose of providing deferred compensation to a select group of
management or highly compensated employees, as such group is described under
Sections 201(2), 301(a)(3), and 401(a)(1) of ERISA.

ARTICLE II

DEFINITIONS AND USAGE

Section 2.1 Definitions. Wherever used in the Plan, the following words
and phrases, when capitalized, shall have the meaning set forth below unless the
context plainly requires a different meaning:

"Account" means the account established on behalf of the Participant
as described in Section 5.3.

"Administrator" means the committee established by the Company
pursuant to Section 7.1 to administer the Plan.

"Board" means the Board of Directors of the Company.

"Code" means the Internal Revenue Code of 1986, as amended from time
to time. Any reference to a particular Code section shall include any
provision that modifies, replaces or supersedes it.

"Committee" means the Compensation Committee of the Board.

"Company" means The Lincoln Electric Company, a corporation organized
under the laws of the state of Ohio, and any successor thereto.

"Compensation" means the amount of a Participant's compensation as
defined in Section 415(c)(3) of the Code paid by the Controlled Group, but
including any salary reduction contributions that are excluded from his
gross income under Sections 125, 129 or 402(a)(8) of the Code, and
including any compensation which the Participant defers under any
nonqualified deferred compensation plan of the Controlled Group.

2
<PAGE> 5

"Controlled Group" or "Controlled Group Member" means the Company and
any and all other corporations, trades or businesses the employees of which
are required by Section 414 of the Code to be treated as a single employer.
An entity will only be considered as a Controlled Group Member during the
period that it is or was a member of the Company's Controlled Group.

"Disability" or "Disabled" means a physical or mental condition of a
Participant resulting from a bodily injury, disease or mental disorder that
renders him incapable of continuing his position of employment with the
Employer. Such Disability shall be determined by the Committee based upon
appropriate medical advice and examination, and taking into account the
ability of the Participant to continue in his same, or similar, position
with his Employer.

"Early Retirement Date" means the date the Participant has both
attained age fifty-five (55) and completed twenty-five (25) Years of
Service.

"Employer" means the Company or any other Controlled Group Member that
adopts the Plan with the Company's consent. Any Controlled Group Member
that adopts the Plan and thereafter ceases to exist, ceases to be a member
of the Controlled Group or withdraws from the Plan shall no longer be
considered an Employer unless otherwise determined by the Committee.

"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time. Any reference to a particular ERISA section
shall include any provision that modifies, replaces, or supersedes it.

"Final Average Pay" means, with respect to any Participant, the
average of his annual Compensation over the three (3) full Years of Service
within his final consecutive full Years of Service (not to exceed seven (7)
Years) that produce the highest such average; provided, however, that if a
Participant has fewer than three (3) full Years of Service, "Final Average
Compensation" shall mean the average of his annual Compensation during all
his Years of Service.

"Normal Retirement Date" means the date a Participant attains age
sixty (60).

"Participant" means an eligible employee of an Employer who is
participating in the Plan in accordance with Section 3.2.

"Participation Factor" means the ratio determined based on active
participation under the Plan. Each employee, upon becoming a Participant,
shall be credited with a Participation Factor of two-tenths (.20) or such
greater factor for such Participant determined by the Committee, in its
sole discretion. Thereafter, a Participant will be credited with an
additional one-tenth (.10) Participation Factor for each Year of Service
earned while an active Participant; fractional credits shall apply for
partial Years of Service. Notwithstanding the foregoing, no Participation
Factor shall exceed one (1.00), and Years of Service earned after the last
day of the Plan Year in which a Participant attains age sixty-seven (67)
shall be disregarded for purposes of determining his Participation Factor.
The Committee may, in its sole discretion, increase or authorize an
increase in a Participant's Participation Factor for any reason deemed
appropriate by the Committee (including, but not limited to, in
consideration of the Participant's execution of a release of all claims
against the Company and its affiliates in a form satisfactory to the
Committee).

"Plan" means The Lincoln Electric Company Supplemental Executive
Retirement Plan, as it may be amended from time to time.

"Plan Year" means the calendar year.

"Qualified Plan Benefit" means the annual benefit, expressed in the
form of a single life annuity that can be derived from the sum of all
employer-provided benefits under all plans intended to be qualified under
Section 401(a) of the Code that are maintained by the Controlled Group. The
amount of the single life annuity determined for any such plan which does
not provide for annuity payments shall be based on a reasonable mortality
assumption and an assumed interest rate of eight percent (8%). For purposes
of this definition, "employer-provided benefits" means all qualified
retirement benefits funded

3
<PAGE> 6

exclusively by employer contributions (and earnings thereon), and shall
include any previous distribution of such benefits made prior to a
Participant's Normal Retirement Date, including, but not limited to, in-
service withdrawals, retirement and disability benefits, or distributions
pursuant to any domestic relations
order. However, Participants' salary-reduction contributions described in
Section 402(a)(8) of the Code (and any earnings thereon) shall not be
treated as benefits funded exclusively by Employer contributions.
Notwithstanding the foregoing, if the Committee grants additional Years of
Service to a Participant for purposes of determining his Retirement
Benefit, "Qualified Plan Benefit" shall also include the annual benefit,
determined as above, to which such Participant is entitled from all
previous employers.

"Retirement Benefit" or "Benefit" means the vested benefit determined
under Article IV.

"Social Security Benefit" means the maximum annual benefit payable
under the Social Security Act, relating to Old-Age and Disability benefits,
determined as of a Participant's Normal Retirement Date, or upon his actual
retirement date, if later.

"Termination for Cause" means the termination of a Participant's
employment due to any act by the Participant which the Committee, in its
complete discretion, determines to be inimical to the best interests of the
Controlled Group, including, but not limited to: (i) serious, willful
misconduct in respect of his duties for his Employer, (ii) conviction of a
felony or perpetration of a common law fraud, (iii) willful failure to
comply with applicable laws with respect to the execution of his Employer's
business operations, (iv) theft, fraud, embezzlement, dishonesty or other
conduct that has resulted or is likely to result in material economic
damage to the Controlled Group, or (v) failure to comply with requirements
of his Employer's drug and alcohol abuse policies, if any.

"Years of Service" means each full and partial calendar-year (in
increments of one-twelfth (1/12th) for each full month) of active
employment with the Controlled Group during which substantial services were
rendered as an employee, commencing on the date the Participant was first
employed by the Controlled Group and ending on the date he ceases to
perform services for the Controlled Group. At the discretion of the
Committee, a Participant may be granted additional Years of Service for
purposes of determining his Retirement Benefit.

Section 2.2 Usage. Except where otherwise indicated by the context, any
masculine terminology used herein shall also include the feminine and vice
versa, and the definition of any term herein in the singular shall also include
the plural and vice versa.

ARTICLE III

ELIGIBILITY AND PARTICIPATION

Section 3.1 Eligibility. An employee of an Employer shall be eligible to
participate in the Plan only to the extent, and for the period, that he is a
member of a select group of management or highly compensated employees, as such
group is described under Sections 201(2), 301(a)(3), and 401(a)(1) of ERISA.

Section 3.2 Participation. An employee who is eligible to participate in
the Plan pursuant to Section 3.1 shall become a Participant at such time and for
such period he is designated as such by the Committee.

ARTICLE IV

RETIREMENT BENEFIT

Section 4.1 Retirement Benefit. Except for Participants described in
Section 4.4, the Retirement Benefit for a Participant who retires from the
employ of his Employer and all Controlled Group Members on or after his Normal
Retirement Date shall be an annual benefit, expressed as a single life annuity
payable over

4
<PAGE> 7

the Participant's life, in an amount equal to (a) minus (b), multiplied by the
Participant's Participation Factor, where:

(a) = one and four hundred forty-five thousandths percent (1.445%) of
such Participant's Final Average Pay multiplied by his Years of
Service, but not greater than sixty-five percent (65%) of the
Participant's Final Average Pay; and

(b) = (i) the Social Security Benefit; plus

(ii) the Participant's Qualified Plan Benefit, determined as of
the valuation date(s) under the applicable plans that
immediately precede the date the Participant retires and
becomes entitled to the distribution of his Benefit under
Article V or Article VI.

For purposes of making the calculation in Subsection (a) of this Section,
Years of Service earned after the last day of the Plan Year in which the
Participant attains age sixty-five (65) shall not be counted.

Section 4.2 Early Retirement Benefit. Except for Participants described in
Section 4.4, the Retirement Benefit for a Participant who retires from the
employ of his Employer and all Controlled Group Members on or after his Early
Retirement Date (but prior to his Normal Retirement Date) shall be the annual
benefit computed under Section 4.1, but based on a projected Social Security
Benefit equal to the maximum annual benefit payable under the provisions of the
Social Security Act as in effect on the date of such retirement indexed forward
to the Participant's Normal Retirement Date, and the annual Benefit so computed
shall be reduced based on the Participant's attained age when his Benefit
hereunder commences, according to the following table:

<TABLE>
<CAPTION>
PARTICIPANT'S ATTAINED AGE PERCENT REDUCTION
AT BENEFIT COMMENCEMENT IN BENEFIT
--------------------------- -----------------
<S> <C>
55 36%
56 30%
57 24%
58 17%
59 9%
60 or later 0%
</TABLE>

Section 4.3 Vesting.

(a) Except as provided below or as otherwise provided in Section 4.4,
a Participant who is in the active employ of an Employer shall have a
vested right to his Benefit only upon the occurrence of any of the
following:

<TABLE>
<S> <C>
(i) with approval by the Committee, the attainment of his Early
Retirement Date;
(ii) the attainment of his Normal Retirement Date;
(iii) his death prior to actual retirement; or
(iv) his Disability prior to actual retirement.
</TABLE>

(b) Notwithstanding the preceding, a Participant's Benefits hereunder
shall be forfeited, and no Benefits shall be payable hereunder with respect
to him or his beneficiaries, in the event of:

<TABLE>
<S> <C>
(i) his Termination for Cause prior to receiving all or a portion
of his Benefit; or
(ii) his termination of employment with all Controlled Group Members
prior to satisfying the requirements for vesting set forth in
Subsection (a) of this Section.
</TABLE>

5
<PAGE> 8

Section 4.4 Other Retirement Benefits. In lieu of the Benefit provided
under Section 4.1 or 4.2, the Committee may, in its sole discretion, determine
to provide a Participant with an alternative supplemental pension benefit under
this Plan, provided that the Company and such Participant negotiate or have
previously negotiated a supplemental pension arrangement that provides for
amounts to be paid other than the Benefits otherwise provided pursuant to the
other terms hereof. The amount of such Participant's supplemental pension, the
manner of payment thereof and any other terms or conditions applicable thereto
shall be as set forth in the agreement between the Company and the Participant
with respect to such arrangement. Articles VII, VIII and IX of the Plan shall
apply to the supplemental pension payable pursuant to any such arrangement to
the extent such Articles do not conflict with the provisions of such agreement.

ARTICLE V

PAYMENT OF RETIREMENT BENEFIT

Section 5.1 Payment of Retirement Benefits. A Participant who retires
under this Plan from the employ of his Employer and all Controlled Group Members
on or after his Normal Retirement Date or Early Retirement Date shall then be
entitled to, and shall receive, a Retirement Benefit, determined in accordance
with Section 4.1 or 4.2, as applicable. Such Benefit shall commence to be paid
not later than ninety (90) days following the date the Participant's retirement
from his Employer becomes effective.

Section 5.2 Form of Retirement Benefits. To the extent a Benefit is
payable to a Participant under Section 5.1, it shall be paid in the form of a
single life annuity, or any actuarially equivalent survivor annuity (determined
using a mortality assumption selected by the Committee in its sole discretion).
Notwithstanding the preceding, at the discretion of the Committee, such Benefit
may be paid in the form of a single lump sum that is the actuarially equivalent
to such single life annuity. Such actuarial equivalence shall be determined
using a mortality assumption selected by the Committee in its sole discretion
and an assumed interest rate of eight percent (8%).

Section 5.3 Payment Procedure. The Employer shall establish and maintain
an Account for each Participant and beneficiary who is receiving a Benefit under
the Plan. Immediately prior to any distribution hereunder to any Participant or
beneficiary, the Employer shall credit the amount of such distribution to such
Account and then immediately distribute or commence to distribute the amount so
credited to the Participant, or as applicable, to his beneficiary. Neither the
Participant nor his beneficiary(s) shall have any interest or right in any such
Account at any time. All amounts credited to the Accounts established under the
Plan shall be credited solely for the purpose of effecting distributions
hereunder and shall remain assets of the Employer subject to the claims of such
Employer's general creditors.

ARTICLE VI

PAYMENT OF BENEFIT ON OR AFTER DEATH OR DISABILITY

Section 6.1 Commencement of Benefit Payments. If a Participant dies or
becomes Disabled while employed by his Employer but prior to becoming entitled
to a Retirement Benefit under Section 5.1 of this Plan, he or his beneficiary or
beneficiaries shall then be entitled to, and shall receive, a Benefit computed
under Section 4.2, as if the Participant had retired immediately prior to his
death or Disability and, if such death or Disability occurred prior to his
attainment of age fifty-five (55), as if he had attained such age. The Committee
may, in its sole discretion, provide that the amount of the such Retirement
Benefit shall be enhanced (including, but limited to, an enhancement that takes
into account projected additional Years of Service or increases in Compensation
that would have occurred absent the Participant's death or Disability). Any
Benefit payable under this paragraph shall be paid in a single lump sum (as
determined in accordance with Section 5.2) within ninety (90) days following the
date the Administrator is notified of the Participant's death or Disability and
the Committee has determined that such Benefit is payable.

6
<PAGE> 9

If a Participant dies or becomes Disabled after becoming entitled to a
Retirement Benefit under Section 5.1 but prior to receiving his entire Benefit
under the Plan, the remaining Benefit otherwise payable with respect to the
Participant shall be paid to him or his beneficiary or beneficiaries in a single
lump-sum amount within ninety (90) days following the date on which the
Administrator is notified of the Participant's death or Disability, as
applicable, unless such remaining Benefit is to be paid in the form of a
survivor annuity. If such remaining benefit is payable in the form of a survivor
annuity, the Participant's beneficiary shall begin to receive such payments
within ninety (90) days following the date on which the Administrator is
notified of the Participant's death.

Section 6.2 Designation of Beneficiary. A Participant may, by written
instruction delivered to the Administrator during the Participant's lifetime,
designate one or more primary and contingent beneficiaries to receive the
Retirement Benefit which may be payable hereunder following the Participant's
death, and may designate the proportions in which such beneficiaries are to
receive such payments. A Participant may change such designations from time to
time, and the last written designation filed with the Administrator prior to the
Participant's death shall control. If a Participant fails to specifically
designate a beneficiary, or if no designated beneficiary survives the
Participant, payment shall be made by the Administrator in the following order
of priority:

(a) to the Participant's surviving spouse; or if none,

(b) to the Participant's children, per stirpes; or if none,

ARTICLE VII

ADMINISTRATION

Section 7.1 General. The Company shall appoint the Administrator,
consisting of two or more individuals who have accepted appointment thereto. The
members of the Administrator shall serve at the discretion of the Company and
may resign by written notice to the Company. Vacancies in the Administrator
shall be filled by the Company. Except as otherwise specifically provided in the
Plan, the Administrator shall be responsible for administration of the Plan. The
Administrator shall be the "named fiduciary" within the meaning of Section
402(c)(2) of ERISA.

Section 7.2 Administrative Rules. The Administrator may adopt such rules
of procedure as it deems desirable for the conduct of its affairs, except to the
extent that such rules conflict with the provisions of the Plan.

Section 7.3 Duties. The Administrator shall have the following rights,
powers and duties:

(a) The decision of the Administrator in matters within its
jurisdiction shall be final, binding and conclusive upon the Employers and
upon any other person affected by such decision, subject to the claims
procedure hereinafter set forth.

(b) The Administrator shall have the sole and absolute duty and
authority to interpret and construe the provisions of the Plan, to
determine eligibility for Benefits and the appropriate amount of any
Benefits, to decide any question which may arise regarding the rights of
employees, Participants and beneficiaries and the amounts of their
respective interests, to construe any ambiguous provision of the Plan, to
correct any defect, supply any omission or reconcile any inconsistency, to
adopt such rules and to exercise such powers as the Administrator may deem
necessary for the administration of the Plan, and to exercise any other
rights, powers or privileges granted to the Administrator by the terms of
the Plan.

(c) The Administrator may appoint such agents, counsel, accountants,
consultants and other persons as it deems necessary to assist in the
administration of the Plan, including, without limitation, employees of an
Employer.

7
<PAGE> 10

(d) The Administrator shall periodically report to the Board with
respect to the status of the Plan.

Section 7.4 Fees. No fee or compensation shall be paid to any person for
services as the Administrator.

Section 7.5 Limitation of Actions. No individual acting on behalf of the
Administrator pursuant to this Article shall have any right to vote upon or
decide any matters relating solely to his own rights under the Plan.

ARTICLE VIII

CLAIMS PROCEDURE

Section 8.1 General. Any claim for Benefits under the Plan shall be filed
by the Participant or beneficiary ("claimant") on the form prescribed for such
purpose with the Administrator. A decision on a claim shall be made within
ninety (90) days after receipt of the claim by the Administrator, unless special
circumstances require an extension of time for processing, in which case a
decision shall be rendered within a reasonable period of time, but not later
than one hundred and eighty (180) days after receipt of the claim.

Section 8.2 Denials. If a claim under the Plan is wholly or partially
denied, written notice of the decision shall be furnished to the claimant by the
Administrator. Such notice shall be written in a manner calculated to be
understood by the claimant and shall set forth:

(a) the specific reason or reasons for the denial;

(b) specific reference to the pertinent provision of the Plan upon
which the denial is based;

(d) an explanation of the claim review procedure under Sections 8.3
and 8.4.

Section 8.3 Appeals Procedure. In order that a claimant may appeal a
denial of a claim, the claimant or the claimant's duly authorized representative
may:

(a) request a review by written application to the Administrator, or
its designate, no later than sixty (60) days after receipt by the claimant
of written notification of denial of a claim;

(b) review pertinent documents; and

Section 8.4 Review. A decision on review of a denied claim shall be made
not later than sixty (60) days after receipt of a request for review, unless
special circumstances require an extension of time for processing, in which case
a decision shall be rendered within a reasonable period of time, but not later
than one hundred and twenty (120) days after receipt of a request for review.
The decision on review shall be in writing, shall be written in a manner
calculated to be understood by the claimant, shall include the specific
reason(s) for the decision and the specific reference(s) to the pertinent
provisions of the Plan on which the decision is based and shall, to the extent
permitted by law, be final and binding on all interested persons.

ARTICLE IX

MISCELLANEOUS PROVISIONS

Section 9.1 Amendment and Termination. The Company reserves the right to
amend or terminate the Plan in any manner that it deems advisable and at any
time, by a resolution of the Board. Notwithstanding the preceding, no amendment
or termination of the Plan shall reduce the vested Benefit of any Participant
determined as of the day immediately preceding the effective date of such
amendment or termination.

8
<PAGE> 11

Section 9.2 No Assignment. A Participant shall not have the power, without
the consent of the Administrator, to pledge, transfer, assign, anticipate,
mortgage or otherwise encumber or dispose of in advance any interest in amounts
payable hereunder or any of the payments provided for herein, nor shall any
interest in amounts payable hereunder or in any payments be subject to seizure
for payments of any debts, judgments, alimony or separate maintenance, or be
reached or transferred by operation of law in the event of bankruptcy,
insolvency or otherwise. If a Participant (or beneficiary) attempts to pledge,
transfer, assign, anticipate, mortgage or otherwise encumber or dispose of in
advance any interest in a Participant's (or beneficiary's) Benefit, or if by
reason of his bankruptcy or other event that would permit any other individual
to obtain his right to his Benefit, he would not be able to enjoy his Benefit,
the Administrator may, in its sole discretion, terminate the Participant's (or
beneficiary's) interest in any Benefit to the extent the Administrator considers
it necessary or advisable to prevent or limit the effects of such occurrence.
Such termination shall be effected by filing a declaration with the Company and
delivering a copy of such declaration to the Participant (or beneficiary).

Any Benefit affected by such termination of interests shall be retained by
the Company and, in the Administrator's sole discretion, may be paid or expended
for the benefit of the affected Participant (or beneficiary), his spouse, his
children or any other person dependent upon him, in such manner as the
Administrator determines is proper.

Section 9.3 Successors and Assigns. The provisions of the Plan are binding
upon and inure to the benefit of each Employer, its successors and assigns, and
the Participant, his beneficiaries, heirs, legal representatives and assigns.

Section 9.4 Governing Law. The Plan shall be subject to and construed in
accordance with the laws of the State of Ohio, except to the extent pre-empted
by applicable Federal law.

Section 9.5 No Guarantee of Employment. Nothing contained in the Plan
shall be construed as a contract of employment or deemed to give any Participant
the right to be retained in the employ of any Controlled Group Member or any
equity or other interest in the assets, business or affairs of a Controlled
Group Member. No Participant hereunder shall have a security interest in assets
of an Employer used to make contributions or pay benefits.

Section 9.6 Severability. If any provision of the Plan shall be held
illegal or invalid for any reason, such illegality or invalidity shall not
affect the remaining provisions of the Plan, but the Plan shall be construed and
enforced as if such illegal or invalid provision had never been included herein.

Section 9.7 Notification of Addresses. Each Participant and each
beneficiary shall file with the Administrator, from time to time, in writing,
the post office address of the Participant, the post office address of each
beneficiary, and each change of post office address. Any communication,
statement or notice addressed to the last post office address filed with the
Administrator (or if no address was filed, then to the last post office address
of the Participant or beneficiary as shown on the Employer's records) shall be
binding on the Participant and each beneficiary for all purposes of the Plan and
neither the Administrator nor any Employer shall be obligated to search for or
ascertain the whereabouts of any Participant or beneficiary.

Section 9.8 Bonding. The Administrator and all agents and advisors
employed by it shall not be required to be bonded.

Section 9.9 Withdrawal of Employer. An Employer (other than the Company)
may withdraw from participation in the Plan and such withdrawal shall constitute
a termination of the Plan as to that Employer; provided, however, that the
Employer shall continue to be treated as an Employer under the Plan with respect
to those Participants (and beneficiaries) to whom the Employer owes a continuing
obligation under the Plan. An Employer may withdraw by executing a written
instrument of withdrawal, approved by its board of directors, and such
withdrawal shall be effective on the date designated in the instrument or, if no
date is specified, on the date of execution of the instrument.

9
<PAGE> 12

ARTICLE X

FUNDING

The entire cost of this Plan shall be paid from the general assets of the
Employer. No liability for the payment of benefits under the Plan shall be
imposed upon any officer, trustee, employee, or agent of an Employer.
---------------

The undersigned, pursuant to the approval of the Board on July 21, 1994,
does herewith execute The Lincoln Electric Company Supplemental Executive
Retirement Plan.

------------------------------------
Chairman of the Board of Directors

<PAGE> 1

THE LINCOLN ELECTRIC COMPANY
DEFERRED COMPENSATION PLAN
<PAGE> 2

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----------
<S> <C> <C>
ARTICLE I. PURPOSE.................................................................. 1

ARTICLE II. DEFINITIONS AND CONSTRUCTION............................................ 1
Section 2.1. Definitions....................................................... 1
Section 2.2. Construction...................................................... 3

ARTICLE III. PARTICIPATION AND DEFERRALS............................................ 4
Section 3.1. Eligibility and Participation..................................... 4
(a) Eligibility........................................................... 4
(b) Participation......................................................... 4
(c) Initial Year of Participation......................................... 4
(d) Termination of Participation.......................................... 4
Section 3.2. Ineligible Participant............................................ 4
Section 3.3. Amount of Deferral................................................ 5
Section 3.4. Matching Amounts.................................................. 5
Section 3.5. Modification of Deferral Commitments.............................. 5

ARTICLE IV. PARTICIPANTS' ACCOUNTS.................................................. 5
Section 4.1. Establishment of Accounts......................................... 5
Section 4.2. Elective Deferred Compensation.................................... 5
Section 4.3. Determination of Accounts......................................... 6
(a) Determination of Accounts............................................. 6
(b) Accounting............................................................ 6
Section 4.4. Adjustments to Accounts........................................... 6
Section 4.5. Statement of Accounts............................................. 6
Section 4.6. Vesting of Accounts............................................... 6

ARTICLE V. FINANCING OF BENEFITS.................................................... 7
Section 5.1. Financing of Benefits............................................. 7
Section 5.2. Security For Benefits............................................. 7
Section 5.3. Investments....................................................... 7

ARTICLE VI. DISTRIBUTION OF BENEFITS................................................ 8
Section 6.1. Settlement Date................................................... 8
Section 6.2. Amount to be Distributed.......................................... 8
Section 6.3. In-Service Distribution........................................... 8
Section 6.4. Form of Distribution.............................................. 8
Section 6.5. Beneficiary Designation........................................... 9
Section 6.6. Facility of Payment............................................... 9
Section 6.7. Hardship Distributions............................................ 10

ARTICLE VII. ADMINISTRATION, AMENDMENT AND TERMINATION.............................. 10
Section 7.1. Administration.................................................... 10
Section 7.2. Plan Administrator................................................ 10
Section 7.3. Amendment, Termination and Withdrawal............................. 11
Section 7.4. Successors........................................................ 11
Section 7.5. Claims............................................................ 11
Section 7.6. Expenses.......................................................... 11

ARTICLE VIII. MISCELLANEOUS......................................................... 11
Section 8.1. No Guarantee of Employment........................................ 11
Section 8.2. Applicable Law.................................................... 12
Section 8.3. Interests Not Transferable........................................ 12
Section 8.4. Severability...................................................... 12
Section 8.5. Withholding of Taxes.............................................. 12
Section 8.6. Top-Hat Plan...................................................... 12
</TABLE>

i
<PAGE> 3

THE LINCOLN ELECTRIC COMPANY
DEFERRED COMPENSATION PLAN

The Lincoln Electric Company Deferred Compensation Plan is made and
executed as of the day of November, 1994 and is effective as of November 15,
1994.

ARTICLE I

PURPOSE

THE LINCOLN ELECTRIC COMPANY DEFERRED COMPENSATION PLAN (the "Plan"), is
hereby established by The Lincoln Electric Company to allow designated
management and highly compensated employees to defer a portion of their current
salary. It is intended that the Plan will aid in attracting and retaining
employees of exceptional ability by providing these benefits. The terms and
conditions of the Plan are set forth below.

ARTICLE II

DEFINITIONS AND CONSTRUCTION

Section 2.1. Definitions. Whenever the following terms are used in this
Plan they shall have the meanings specified below unless the context clearly
indicates to the contrary:

(a) "Account": The bookkeeping account maintained for each Participant
showing his interest under the Plan.

(b) "Accounting Date": December 31 of each year and the last day of
any calendar quarter in which a Participant's Settlement Date occurs.

(c) "Accounting Period": The period beginning on the day immediately
following an Accounting Date and ending on the next following Accounting
Date.

(d) "Administrator": The committee established pursuant to the
provisions of Section 7.1.

(e) "Base Salary": The base earnings paid by the Corporation to a
Participant without regard to any increases or decreases in base earnings
as a result of an election to defer base earnings under this Plan, or an
election between benefits or cash provided under a plan of the Corporation
maintained pursuant to Section 125 or 401(k) of the Code.

(f) "Beneficiary": The person or persons (natural or otherwise),
within the meaning of Section 6.5, who are entitled to receive distribution
of the Participant's Account balance in the event of the Participant's
death.

(g) "Board": The Board of Directors of the Corporation.

(h) "Bonus": Any bonus paid by the Corporation to a Participant
without regard to any decreases as a result of an election to defer all or
any portion of a bonus under this Plan, or an election between benefits or
cash provided under a plan of the Corporation maintained pursuant to
Section 125 or 401(k) of the Code.

(i) "Code": The Internal Revenue Code of 1986, as amended from time to
time; any reference to a provision of the Code shall also include any
successor provision thereto.

(j) "Committee": The Compensation Committee of the Board.

(k) "Compensation": The amount of Base Salary plus Bonuses paid for
the Plan Year by the Corporation to a Participant.

(l) "Corporation": The Lincoln Electric Company or any successor or
successors thereto.
<PAGE> 4

(m) "Deferral Commitment": An agreement by a Participant to have a
specified percentage or dollar amount of his Compensation deferred under
the Plan for a specified period in the future.

(n) "Deferral Period": Means the Plan Year for which a Participant has
elected to defer a portion of his Compensation.

(o) "Disability": The occurrence, while a Participant is an Employee,
of a physical or mental incapacity which is likely to be permanent and
which prevents a Participant from engaging in any occupation or performing
any work for compensation or profit for which he is qualified by education,
training or experience, as determined by the Administrator in its sole
discretion on the basis of medical evidence certified by a physician or
physicians designated by it.

(p) "Effective Date": November 15, 1994.

(q) "Employee": Any employee of the Corporation who is, as determined
by the Committee, a member of a "select group of management or highly
compensated employees" of the Corporation, within the meaning of Sections
201, 301 and 401 of ERISA, and who is designated by the Committee as an
Employee eligible to participate in the Plan.

(r) "ERISA": The Employee Retirement Income Security Act of 1974, as
amended from time to time; any reference to a provision of ERISA shall also
include any successor provision thereto.

(s) "Financial Hardship": An unforeseeable financial emergency of the
Participant, determined by the Administrator on the basis of information
supplied by the Participant, arising from an illness, disability, casualty
loss, sudden financial reversal or other such unforeseeable occurrence, but
not including foreseeable events such as the purchase of a house or
education expenses for children.

(t) "Matching Amount": The amount credited to a Participant's Matching
Account under Section 3.4.

(u) "Participant": An Employee participating in the Plan in accordance
with the provisions of Section 3.1 or a former Employee retaining benefits
under the Plan that have not been fully paid.

(v) "Participation Agreement": The Agreement submitted by a
Participant to the Administrator with respect to one or more Deferral
Commitments.

(w) "Plan": The Plan set forth in this instrument as it may, from time
to time, be amended.

(x) "Plan Year": The 12-month period beginning January 1 through
December 31; provided that the first plan year shall begin on November 15,
1994 and end on December 31, 1994.

(y) "Retirement": Termination of employment with the Corporation on or
after attainment
of age 60.

(z) "Settlement Date": The date on which a Participant terminates
employment with the Corporation. Leaves of absence granted by the
Corporation will not be considered as termination of employment during the
term of such leave. Settlement Date shall also include with respect to any
Deferral Period the date prior or subsequent to termination of employment
selected by a Participant in a Participation Agreement for distribution of
all or a portion of the amounts deferred during such Deferral Period.

Section 2.2. Construction. The masculine gender, where appearing in the
Plan, shall be deemed to include the feminine gender, and the singular may
include the plural, unless the context clearly indicates to the contrary. The
words "hereof," "herein," "hereunder," and other similar compounds of the word
"here" shall mean and refer to the entire Plan, and not to any particular
provision or Section.

2
<PAGE> 5

ARTICLE III

PARTICIPATION AND DEFERRALS

Section 3.1. Eligibility and Participation.

(a) Eligibility. Eligibility to participate in the Plan for any
Deferral Period is limited to those management and/or highly compensated
Employees of the Corporation (i) who are designated, from time to time, by
the Committee, and (ii) who have elected to make the maximum elective
contributions permitted them under the terms of the Corporation's Employee
Savings Plan for such Deferral Period.

(b) Participation. An eligible Employee may elect to participate in
the Plan with respect to any Deferral Period by submitting a Participation
Agreement to the Administrator by the last business day immediately
preceding the applicable Deferral Period.

(c) Initial Year of Participation. In the event that an individual
first becomes eligible to participate during a Deferral Period and wishes
to elect a Deferral Commitment with respect to the Compensation earned by
and payable to the individual during such Deferral Period, a Participation
Agreement must be submitted to the Administrator no later than 30 days
following such individual's initial eligibility. Any Deferral Commitments
elected in such Participation Agreement shall be effective only with regard
to Compensation earned following the submission of the Participation
Agreement to the Administrator. If an eligible Employee does not submit a
Participation Agreement within such period of time, such individual will
not be eligible to participate in the Plan until the first day of a
Deferral Period subsequent to the Deferral Period in which the individual
initially became eligible to participate.

(d) Termination of Participation. Participation in the Plan shall
continue as long as the Participant is eligible to receive benefits under
the Plan.

Section 3.2. Ineligible Participant. Notwithstanding any other provisions
of this Plan to the contrary, if the Administrator determines that any
Participant may not qualify as a "management or highly compensated employee"
within the meaning of ERISA, or regulations thereunder, the Administrator may
determine, in its sole discretion, that such Participant shall cease to be
eligible to participate in this Plan. Upon such determination, the Corporation
shall make an immediate lump sum payment to the Participant equal to the amount
credited to his Account. Upon such payment no benefit shall thereafter be
payable under this Plan either to the Participant or any Beneficiary of the
Participant, and all of the Participant's elections as to the time and manner of
payment of his Account will be deemed to be cancelled.

Section 3.3 Amount of Deferral. With respect to each Plan Year, a
Participant may elect to defer a specified dollar amount or percentage of his or
her Compensation, provided the amount the Participant elects to defer under this
Plan and the Corporation's Employee Savings Plan shall not exceed 25% of his
Compensation for the Plan Year. A Participant may choose to have amounts
deferred under this Plan deducted from his Base Salary, Bonus or a combination
of both. For the first Plan Year, a Participant may elect to defer all or any
portion of his or her Compensation earned or payable after the later of the
effective date of the Participation Agreement or the date of filing the
Participation Agreement with the Administrator, provided the total deferred
amount for such Plan Year does not exceed the annual limitation under this
Section 3.3 computed for the calendar year. A Participant may change the dollar
amount or percentage of his or her Compensation to be deferred by filing a
written notice thereof with the Administrator. Any such change shall be
effective as of the first day of the Plan Year immediately succeeding the Plan
Year in which such notice is filed with the Administrator.

Section 3.4. Matching Amounts. The Corporation may, in its discretion,
provide Matching Amounts under this Plan with respect to each Participant.

Section 3.5. Modification of Deferral Commitments. A Deferral Commitment
shall be irrevocable, except that the Administrator may, in its sole discretion,
permit a Participant to terminate, prospectively, any Deferral Commitment for a
Deferral Period. If a Participant terminates a Deferral Commitment during a

3
<PAGE> 6

Deferral Period, such Participant will not be permitted to enter into a new
Deferral Commitment until the following Deferral Period.

ARTICLE IV

PARTICIPANTS' ACCOUNTS

Section 4.1. Establishment of Accounts. The Corporation, through its
accounting records, shall establish an Account for each Participant. In
addition, the Corporation may establish one or more subaccounts of a
Participant's Account, if the Corporation determines that such subaccounts are
necessary or appropriate in administering the Plan.

Section 4.2. Elective Deferred Compensation. A Participant's Compensation
that is deferred pursuant to a Deferral Commitment shall be credited to the
Participant's Account within thirty days following the date the corresponding
non-deferred portion of his Compensation would have been paid to the
Participant. Any Matching Amount provided pursuant to Section 3.4 shall be
credited at the time designated by the Corporation. Any withholding of taxes or
other amounts with respect to deferred Compensation which is required by state,
federal or local law shall be withheld from the Participant's non-deferred
Compensation.

Section 4.3. Determination of Accounts.

(a) Determination of Accounts. The amount credited to each
Participant's Account as of a particular date shall equal the deemed
balance of such Account as of such date. The balance in the Account shall
equal the amount credited pursuant to Section 4.2, and shall be adjusted in
the manner provided in Section 4.4.

(b) Accounting. The Corporation, through its accounting records,
shall maintain a separate and distinct record of the amount in each Account
as adjusted to reflect income, gains, losses, withdrawals and
distributions.

Section 4.4. Adjustments to Accounts.

(a) Each Participant's Account shall be debited with the amount of any
distributions under the Plan to or on behalf of the Participant or, in the
event of his death, his Beneficiary during the Accounting Period ending on
such Accounting Date.

(b) The Participant's Account shall next be credited or debited, as
the case may be, with an income (loss) factor equal to an amount determined
by multiplying (i) the balance credited to the Participant's Account as of
the immediately preceding Accounting Date (as adjusted pursuant to Section
4.2(a) for the current Accounting Date) by (ii) the rate of return for the
Accounting Period ending on such Accounting Date on deemed investments
provided for in Section 5.3.

Section 4.5. Statement of Accounts. As soon as practicable after the end
of each Plan Year, a statement shall be furnished to each Participant or, in the
event of his death, to his Beneficiary showing the status of his Account as of
the end of the Plan Year, any changes in his Account since the end of the
immediately preceding Plan Year, and such other information as the Administrator
shall determine.

Section 4.6. Vesting of Accounts. Subject to Section 5.1, each Participant
shall at all times have a nonforfeitable interest in his Account balance.

ARTICLE V

FINANCING OF BENEFITS

Section 5.1. Financing of Benefits. Benefits payable under the Plan to a
Participant or, in the event of his death, to his Beneficiary shall be paid by
the Corporation from its general assets. The payment of benefits

4
<PAGE> 7

under the Plan represents an unfunded, unsecured obligation of the Corporation.
Notwithstanding the fact that the Participants' Accounts may be adjusted by an
amount that is measured by reference to the performance of any deemed
investments as provided in Section 5.3, no person entitled to payment under the
Plan shall have any claim, right, security interest or other interest in any
fund, trust, account, insurance contract, or asset of the Corporation which may
be responsible for such payment.

Section 5.2. Security for Benefits. Notwithstanding the provisions of
Section 5.1, nothing in this Plan shall preclude the Corporation from setting
aside amounts in trust (the "Trust") pursuant to one or more trust agreements
between a trustee and the Corporation. However, no Participant or Beneficiary
shall have any secured interest or claim in any assets or property of the
Corporation or the Trust and all funds contained in the Trust shall remain
subject to the claims of the Corporation's general creditors.

Section 5.3. Investments. The Committee may designate one or more separate
investment funds or vehicles, including, without limitation, certificates of
deposit, mutual funds, money market accounts or funds, limited partnerships, or
debt or equity securities, including equity securities of the Corporation
(measured by market value, book value or any formula selected by the Committee),
in which the amount credited to a Participant's Account will be deemed to be
invested. Each Participant shall file an investment preference request
("Request") to be effective as of the date of such Request with respect to the
amounts credited to his Account as of such date and amounts subsequently
credited to his Account. A Request will advise the Administrator as to the
Participant's preference with respect to investment vehicles for all or some
portion of the amounts credited to a Participant's Account in specified
multiples of 10%. A Request may be changed prospectively by a Participant only
as of January 1, April 1, July 1 and October 1 by giving the Administrator prior
written notice. The Administrator may, but is under no obligation to, deem the
amounts credited to a Participant's Account to be invested in accordance with
the Request made by the Participant, or the Committee may, instead, in its sole
discretion, deem such Account to be invested in any deemed investment funds
selected by the Committee. Earnings on any amounts deemed to have been invested
in any deemed investment fund shall be deemed to have been reinvested in such
fund.

ARTICLE VI

DISTRIBUTION OF BENEFITS

Section 6.1. Settlement Date. A Participant or, in the event of his death,
his Beneficiary shall be entitled to distribution of the balance of his Account,
as provided in this Article VI, following his Settlement Date or Dates.

Section 6.2. Amount to be Distributed. The amount to which a Participant
or, in the event of his death, his Beneficiary is entitled in accordance with
the following provisions of this Article shall be based on the Participant's
adjusted account balance determined as of the Accounting Date coincident with or
next following his Settlement Date or Dates.

Section 6.3. In-Service Distribution. A Participant may elect to commence
to receive an in-service distribution of his or her deferred Compensation for
any Deferral Period beginning at any time at least two years after the date such
Compensation otherwise would have been first payable. A Participant's election
of an in-service distribution shall be filed in writing with the Administrator
at the same time as is filed his election to participate as provided in Section
3.1. The Participant may elect to receive such Compensation as an in-service
distribution under one of the forms provided in Section 6.4. Any benefits paid
to the Participant as an in-service distribution shall reduce the Participant's
Account.

Section 6.4. Form of Distribution. As soon as practicable after the end of
the Accounting Period in which a Participant's Settlement Date occurs, but in no
event later than thirty days following the end of such Accounting Period, the
Corporation shall commence distribution or cause distribution to be commenced,
to the Participant or, in the event of his death, to his Beneficiary, of the
balance of the Participant's Account, as determined under Section 6.2, under one
of the forms provided in this Section. Notwithstanding the foregoing,

5
<PAGE> 8

if elected by the Participant, the distribution of all or a portion of the
Participant's Account may commence on a date between the Settlement Date and the
date the Participant attains age sixty-five.

Distribution of a Participant's Account with respect to any Deferral Period
shall be made in one of the following forms as elected by the Participant:

(a) by payment in cash in five (5) annual installments; or

(b) by payment in cash in ten (10) annual installments; or

The Participant's election of the form of distribution shall be made by
written notice filed with the Administrator at least one (1) year prior to the
Participant's voluntary termination of employment with, or retirement from, the
Corporation. Any such election may be changed by the Participant at any time and
from time to time without the consent of any other person by filing a later
signed written election with the Administrator; provided that any election made
less than one (1) year prior to the Participant's voluntary termination of
employment or retirement shall not be valid, and in such case payment shall be
made in accordance with the Participant's prior election.

The amount of each installment shall be equal to the quotient obtained by
dividing the Participant's Account balance as of the date of such installment
payment by the number of installment payments remaining to be made to or in
respect of such Participant at the time of calculation.

If a Participant fails to make an election in a timely manner as provided
in this Section 6.4, distribution shall be made in cash in ten (10) annual
installments.

Section 6.5. Beneficiary Designation. As used in the Plan the term
"Beneficiary" means:

(a) The last person designated as Beneficiary by the Participant in a
written notice on a form prescribed by the Administrator;

(b) If there is no designated Beneficiary or if the person so
designated shall not survive the Participant, such Participant's spouse; or

(c) If no such designated Beneficiary and no such spouse is living
upon the death of a Participant, or if all such persons die prior to the
full distribution of the Participant's Account balance, then the legal
representative of the last survivor of the Participant and such persons,
or, if the Administrator shall not receive notice of the appointment of any
such legal representative within one year after such death, the
heirs-at-law of such survivor (in the proportions in which they would
inherit his intestate personal property) shall be the Beneficiaries to whom
the then remaining balance of the Participant's Account shall be
distributed.

Any Beneficiary designation may be changed from time to time by like notice
similarly delivered. No notice given under this Section shall be effective
unless and until the Administrator actually receives such notice.

Section 6.6. Facility of Payment. Whenever and as often as any Participant
or his Beneficiary entitled to payments hereunder shall be under a legal
disability or, in the sole judgment of the Administrator, shall otherwise be
unable to apply such payments to his own best interests and advantage, the
Administrator in the exercise of its discretion may direct all or any portion of
such payments to be made in any one or more of the following ways: (i) directly
to him; (ii) to his legal guardian or conservator; or (iii) to his spouse or to
any other person, to be expended for his benefit; and the decision of the
Administrator, shall in each case be final and binding upon all persons in
interest.

Section 6.7. Hardship Distributions. Upon a finding by the Administrator
that a Participant has suffered a Financial Hardship, the Administrator may, in
its sole discretion, distribute, or direct the Trustee to distribute, to the
Participant an amount which does not exceed the amount required to meet the
immediate financial needs created by the Financial Hardship and not reasonably
available from other sources of the

6
<PAGE> 9

Participant; provided, however, that in no event shall any amount attributable
to a Deferral Commitment be distributed less than six months after the date of
the applicable Participation Agreement. No distributions pursuant to this
Section 6.4 may be made in excess of the value of the Participant's Account at
the time of such distribution.

ARTICLE VII.

ADMINISTRATION, AMENDMENT AND TERMINATION

Section 7.1. Administration. The Plan shall be administered by an
Administrator consisting of one or more persons who shall be appointed by and
serve at the pleasure of the Board. The Administrator shall have such powers as
may be necessary to discharge its duties hereunder, including, but not by way of
limitation, to construe and interpret the Plan and determine the amount and time
of payment of any benefits hereunder. The Administrator may, from time to time,
employ agents and delegate to them such administrative duties as it sees fit,
and may from time to time consult with legal counsel who may be counsel to the
Corporation. The Administrator shall have no power to add to, subtract from or
modify any of the terms of the Plan, or to change or add to any benefits
provided under the Plan, or to waive or fail to apply any requirements of
eligibility for a benefit under the Plan. No member of the Administrator shall
act in respect of his own Account. All decisions and determinations by the
Administrator shall be final and binding on all parties. All decisions of the
Administrator shall be made by the vote of the majority, including actions in
writing taken without a meeting. All elections, notices and directions under the
Plan by a Participant shall be made on such forms as the Administrator shall
prescribe.

Section 7.2. Plan Administrator. The Corporation shall be the
"administrator" under the Plan for purposes of ERISA.

Section 7.3. Amendment, Termination and Withdrawal. The Plan may be
amended from time to time or may be terminated at any time by the Board. No
amendment or termination of the Plan, however, may adversely affect the amount
or timing of payment of any person's benefits accrued under the Plan to the date
of amendment or termination without such person's written consent.

Section 7.4. Successors. The Corporation shall require any successor
(whether direct or indirect, by purchase, merger, consolidation, reorganization
or otherwise) to all or substantially all of the business and/or assets of the
Corporation expressly to assume and to agree to perform this Plan in the same
manner and to the same extent the Corporation would be required to perform if no
such succession had taken place. This Plan shall be binding upon and inure to
the benefit of the Corporation and any successor of or to the Corporation,
including without limitation any persons acquiring directly or indirectly all or
substantially all of the business and/or assets of the Corporation whether by
sale, merger, consolidation, reorganization or otherwise (and such successor
shall thereafter be deemed the "Corporation" for the purposes of this Plan), and
the heirs, beneficiaries, executors and administrators of each Participant.

Section 7.5. Claims. The Administrator will provide to any Participant or
Beneficiary whose claim for benefits under the Plan has been fully or partially
denied a written notice setting forth (i) the specific reasons for such denial,
(ii) a designation of any additional material or information required and (iii)
an explanation of the Plan's claim review procedure. Such notice shall state
that the Participant or Beneficiary is entitled to request a review in writing,
by the Administrator, of the decision denying the claim. The claim will be
reviewed by the Administrator who may, but need not, grant the claimant a
hearing. On review, the claimant may have legal representation, examine
pertinent documents and submit issues and comments in writing. The decision on
review will be made within 120 days following the request, will be provided in
writing to the claimant and will be final and binding on all parties concerned.

Section 7.6. Expenses. All expenses of the Plan shall be paid by the
Corporation from funds other than those deemed investments as provided in
Section 5.3, except that brokerage commissions and other

7
<PAGE> 10

transaction fees and expenses relating to the investment of deemed assets and
investment fees attributable to commingled investment of such assets shall be
paid from or charged to such assets or earnings thereon.

ARTICLE VIII.

MISCELLANEOUS

Section 8.1. No Guarantee of Employment. Nothing contained in the Plan
shall be construed as a contract of employment between the Corporation and any
Employee, or as a right of any Employee, to be continued in the employment of
the Corporation, or as a limitation of the right of the Corporation to discharge
any of its Employees, with or without cause.

Section 8.2. Applicable Law. All questions arising in respect of the Plan,
including those pertaining to its validity, interpretation and administration,
shall be governed, controlled and determined in accordance with the applicable
provisions of federal law and, to the extent not preempted by federal law, the
laws of the State of Ohio.

Section 8.3. Interests Not Transferable. No person shall have any right to
commute, encumber, pledge or dispose of any interest herein or right to receive
payments hereunder, nor shall such interests or payments be subject to seizure,
attachment or garnishment for the payments of any debts, judgments, alimony or
separate maintenance obligations or be transferable by operation of law in the
event of bankruptcy, insolvency or otherwise, all payments and rights hereunder
being expressly declared to be nonassignable and nontransferable.

Section 8.4. Severability. Each section, subsection and lesser section of
this Plan constitutes a separate and distinct undertaking, covenant and/or
provision hereof. Whenever possible, each provision of this Plan shall be
interpreted in such manner as to be effective and valid under applicable law. In
the event that any provision of this Plan shall finally be determined to be
unlawful, such provision shall be deemed severed from this Plan, but every other
provision of this Plan shall remain in full force and effect, and in
substitution for any such provision held unlawful, there shall be substituted a
provision of similar import reflecting the original intention of the parties
hereto to the extent permissible under law.

Section 8.5. Withholding of Taxes. The Corporation may withhold or cause
to be withheld from any amounts payable under this Plan all federal, state,
local and other taxes as shall be legally required.

Section 8.6. Top-Hat Plan. The Plan is intended to be a plan which is
unfunded and maintained primarily for the purpose of providing deferred
compensation for a select group of management or highly compensated employees
within the meaning of Sections 201, 301 and 401 of ERISA, and therefore to be
exempt from the provisions of Parts 2, 3 and 4 of Title I of ERISA. Accordingly,
notwithstanding any other provision of the Plan, the Plan will terminate and no
further benefits will accrue hereunder in the event it is determined by a court
of competent jurisdiction or by an opinion of counsel based upon a change in law
that the Plan constitutes an employee pension benefit plan within the meaning of
Section 3(2) of ERISA, which is not so exempt. In addition and notwithstanding
any other provision of the Plan, in the absolute discretion of the Committee,
the amount credited to each Participant's Account under the Plan as of the date
of termination, which shall be an Accounting Date for purposes of the Plan, will
be paid immediately to such Participant in a single lump sum cash payment.

8
<PAGE> 11

IN WITNESS WHEREOF, The Lincoln Electric Company has caused this instrument
to be executed in its name as of the date first above written.

THE LINCOLN ELECTRIC COMPANY

By:
------------------------------------

Its:
------------------------------------

Attest:

------------------------------------------------------

<PAGE> 1
EXHIBIT 10(e)

[LINCOLN ELECTRIC LOGO]

THE LINCOLN ELECTRIC COMPANY

22801 St. Clair Avenue
Cleveland, Ohio 44117-1199 U.S.A.
(216) 481-8100

July 14, 1993

Mr. Anthony A. Massaro
701 Osage Road
Pittsburgh, PA 15243

Dear Tony:

It is with pleasure that we extend to you an offer to join the Lincoln
Electric Company on August 1, 1993. Your position is Director, International
Operations, and you will report to me.

Your compensation will include an annual base salary of $240,000, payable
according to our standard payroll schedule. Such salary will be subject to our
normal area wage index except for any periods during which the then current
indexed salary would be reduced. For such periods, the salary paid will be
unchanged until the multiplier causes the indexed salary to exceed the salary
being paid.

Lincoln Electric will provide you with $50,000 of term life insurance.

You will be eligible for participation in our Employee Stock Purchase Plan
in the same manner as other Lincoln Electric employees.

You will participate in the Lincoln Electric retirement annuity program in
the same manner as other employees of the company. Additionally, you will
participate in a non-qualified, non-funded Supplemental Employee Retirement Plan
(SERP), which includes a requirement for forty years of service with the company
and retirement at age 65 or later. In this regard, we will credit you with
twenty-four years at your starting date. The plan is designed to provide at age
65, 65% of the average income of the three best years out of the previous seven.
The 65% will be made up of: our qualified plan, social security and retirement
benefits under any retirement or annuity program provided by previous employers
and our non-qualified plan. The SERP will be protected by a "Rabbi-Trust". The
SERP becomes payable should you leave for reasons other than cause. Its payment
amount if paid prior to age 65 will be at 56% through 1994, rising by one
percentage point each following year until it reaches 65%, and with a reduction
for service short of 40 years based upon multiplying the payable amount by the
ratio of qualified service to forty years, and actuarily reduced based on age.
It is understood that should you voluntarily leave the Company prior to age 65,
no entitlements to the SERP exist.

The twenty-four years' credit relative to the Supplemental Employee
Retirement Plan and vacation schedule will also be credited to other applicable
benefit programs, except for Quarter Century Club membership and service pin
entitlements.

Normally, we provide two weeks of paid vacation after one year of full time
employment, three weeks after thirteen years, four weeks after twenty years, and
five weeks after twenty-five years. In your case, we will credit you with the
same twenty-four year period referenced above; thus, you will be entitled to
four weeks of vacation during your first year.

We will cover your moving expenses from your home to the Cleveland area,
including all closing costs, through June 1, 1994 in accordance with the Lincoln
Electric Domestic Moving Policy.

On your third anniversary with Lincoln, we will review with you the terms
of your employment for the purpose of developing a salary base and incentive
bonus compensation package as it applies to all other Lincoln Electric
employees. Total compensation at that point will be at least equal to your then
existing base salary.
<PAGE> 2

Although we fully expect a long and productive relationship, you will be
covered by an executive severance equal to one year's base salary if you are
asked to leave the Company, for reasons other than for cause, or your duties are
substantially reduced.

Our employment offer is contingent upon resolution of the following issues:
That you will not be in breach of any obligations to prior employers or other
third parties by entering into employment with the Lincoln Electric Company in
the position and manner discussed, and that you agree that you will, under no
circumstances use or disclose information which is confidential or proprietary
to your previous employer while in the employ of Lincoln Electric.

Yours very truly,

/s/ D. F. Hastings
-----------------------------------
Chairman and
Chief Executive Officer

D. F. Hastings:ds

Accepted:

/s/ Anthony A. Massaro
-----------------------------------
Anthony A. Massaro

July 14, 1993
-----------------------------------
Date
<PAGE> 3
EXHIBIT 10(e)
THE LINCOLN ELECTRIC COMPANY

INTERNATIONAL ASSIGNMENT CONTRACT

ANTHONY A. MASSARO

ASSIGNMENT LETTER

This letter confirms our mutual understanding of the terms and conditions
applying to your employment with the company as President & CEO, LE Europe in
U.K. subject to your acceptance of the terms and conditions as outlined in this
letter. The effective date of your international assignment is January 1, 1994.
Your home country has been designated as Pittsburgh, PA, USA.

Your assignment is expected to last 2 years, but not more than 5 years,
except as mutually agreed.

Your base salary and benefits have been designed to provide you with a
level of income and benefits comparable to those you would have received in your
home country.

The terms and conditions outlined in this letter will be in effect only for
the period of this assignment. When you return home at the completion of your
assignment, you will stop receiving any premiums, allowances, and/or
differentials provided under this program.

ELEMENTS OF COMPENSATION
BASE SALARY

Your base salary is currently $240,000 per year. This will be increased to
$288,000 beginning January 1, 1994. The Compensation Committee may consider a
bonus based on the results in Europe and the financial health of the company as
a whole.

TAXES

In order to equalize your tax bill with that of your counterpart in your
home country while you are on international assignment, hypothetical U.S. state
and local taxes will be deducted periodically from your total salary. At year
end, the company will reimburse the difference between a theoretical home
country tax and taxes actually paid in both the U.S. and the assignment country.

The accounting firm Ernst & Young will prepare your foreign and U.S. tax
returns and will assist the company by providing the information necessary to
compute your tax reimbursement. You are responsible for providing all your tax
information to Ernst & Young on a timely basis by completing their questionnaire
and for ultimate filing of all your tax returns.

COST OF LIVING

An annual cost of living differential of $48,000 will be used to equalize
the costs of goods and services in your international assignment country with
those in your home country.

HOUSING

The company will pay your actual cost of rental housing up to a maximum of
45,000 English Pounds annually in England including all utilities.

FOREIGN ASSIGNMENT PREMIUM

You will receive a foreign assignment premium of 10 percent of base salary,
or $2,400 per month. The company provides you with this incentive in recognition
of your dedication in undertaking your international assignment. You will
receive the first year's premium of $28,800 as a lump sum payment prior to
January 1, 1994.
<PAGE> 4

METHOD OF TIMING OF PAYMENTS

Your total compensation will probably be paid partially in U.S. dollars and
partially in the foreign currency of your country of assignment. In general,
your cost of living differential will be remitted to you in foreign currency,
when possible. All other amounts will be deposited in U.S. dollars via wire
transfer to the account you designate (local or U.S.). Note that in special
circumstances U.S. and/or foreign tax considerations may influence the timing
and method of payment. In these cases, the company may work with tax consultants
in order to minimize taxes wherever possible without undue inconvenience to you.

RELOCATION ALLOWANCE

A one-time relocation allowance of $20,000 will be paid to you before
January 1, 1994. This allowance is designed to aid you with the purchase of
luggage, hardware, and other incidental expenses related to your move.

SHIPPING/STORAGE

The company will assume all reasonable expenses incurred for insuring and
shipping your personal effects to your final destination. The company will also
pay for any import duties and other expenses necessary for the actual delivery
of these goods, as well as for storage of goods that remain in the home country.

EDUCATION
FOREIGN LANGUAGE

The company will reimburse you and your spouse for appropriate language
courses.

DEPENDENTS

The company will pay education allowance in order to provide elementary
education for your child which is equivalent to that of public education in your
home country.

AUTOMOBILES

The company will protect you on the loss resulting from the forced sale of
your domestic auto prior to your transfer to your country of assignment. When on
assignment, a leased car will be provided for you.

HOME LEAVE

You are eligible for two home leaves per year. The actual cost of business
class air fare for you and your family will be paid by the company for
round-trip travel from U.K. to Pittsburgh, PA. Incidental expenses en route will
also be covered.

REPATRIATION

Normally, employees returning from international assignments will return to
their home-country department for reassignment. Relocation (travel, shipping,
and temporary living expenses) policies as noted above will apply to
repatriation.

TERMINATION

If you terminate while abroad either at your own or the company's option,
the company will pay moving expenses in accordance with the company's domestic
and foreign policy for yourself, your family and your household belongings.
Expenses to your home country will be paid, provided you return within 30 days
of termination. If a company-initiated termination occurs, you will receive
adequate advance notice. Similarly, if you voluntarily terminate, you are
expected to give appropriate notice. If you are provided with leased housing,
you must agree to vacate within 30 days of termination. Termination will require
immediate settlement of all
<PAGE> 5

outstanding tax, travel, and other advances. Other conditions included in your
original offer letter dated July 14, 1993 will continue to apply.

CONDUCT

Each employee on international assignment is expected to conduct business
affairs with the highest level of integrity. In general, domestic guidelines
should always be followed.

With respect to tax compliance, please note the following:

- The company regards compliance with U.S. and foreign income tax
requirements as a mandatory obligation of the expatriate.

- Expatriates must conduct themselves at all times so as to avoid charges
of tax evasion or abuse, or of violation of local law, which could
jeopardize in any way their standing personally or as a representative of
the company.

- Expatriates are expected to exercise care and attention in minimizing
their liability for U.S. and foreign taxes in accordance with appropriate
principles of tax planning. Expatriates must cooperate with both the
company and the outside tax consultants to ensure that their tax returns
are filed on a timely basis and in such a manner as to produce the lowest
possible tax permitted by law.

AGREEMENT

This agreement is made at Cleveland, Ohio and is subject to all applicable
laws thereof. In the event that any provision of this letter shall be held
invalid or unenforceable by reason of law, such invalidity or unenforceability
shall attach only to such provisions and shall not affect or render invalid or
unenforceable any other provision of this letter.

______________________________________
Donald F. Hastings,
Chairman and Chief Executive Officer

______________________________________
Date

I agree and accept this assignment
as outlined above.

______________________________________
Anthony A. Massaro

______________________________________
Date

<PAGE> 1

EXHIBIT 10(F)

June 22, 1993

Mr. Jay Elliott
72 Cohasset
Hudson, OH 44236

Dear Jay:

It is with pleasure that we extend to you an offer to join the Lincoln
Electric Company at the earliest possible date. Your position would be Chief
Financial Officer by the end of the first quarter of 1994, and you would report
to me. Initially, you will serve as International Chief Financial Officer.

Your compensation will include an annual base salary of $220,000, payable
according to our standard payroll schedule. Such salary will be subject to our
normal area wage index except for any periods during which the then current
indexed salary would be reduced. For such periods, the salary paid will be
unchanged until the multiplier causes the indexed salary to exceed the salary
being paid.

Basic medical insurance as offered to Lincoln Electric employees, will be
paid by the Lincoln Electric Company. A Blue Cross/Blue Shield family contract
through February 28, 1994 is valued at $453.18 per month.

Lincoln Electric will provide you with $10,000 of term life insurance. You
may optionally subscribe to an additional $40,000 of term life at your expense
and at the rate available to other Lincoln Electric employees. Our employees pay
for the accidental death and dismemberment provision on the company paid life
insurance as well as any contributory insurance. In your case, this would amount
to approximately $18.50 per month.

You will be eligible for participation in our Employee Stock Purchase Plan
in the same manner as other Lincoln Electric employees.

You will participate in the Lincoln Electric retirement annuity program in
the same manner as other employees of the company. Additionally, you will
participate in a non-qualified, non-funded Supplemental Employee Retirement Plan
(SERP), which includes a requirement for forty years of service with the company
and retirement at age 65 or later. In this regard, we will credit you with
twenty-seven years, at your starting date. The plan is designed to provide at
age 65, 65% of the average income of the three best years out of the previous
seven. The 65% will be made up of: our qualified plan, social security and
retirement benefits under any retirement or annuity program provided by previous
employers and our non-qualified plan. The SERP will be protected by a
"Rabbi-Trust". The SERP becomes payable should you leave for reasons other than
cause. Its payment amount if paid prior to age 65 will be at 56% through 1994,
rising by one percentage point each following year until it reaches 65%, and
with a reduction for service short of 40 years based upon multiplying the
payable amount by the ratio of qualified service to forty years, and actuarily
reduced based on age. It is understood that should you voluntarily leave the
Company prior to age 65, no entitlements to the SERP exist.

The twenty-seven years' credit relative to the Supplemental Employee
Retirement Plan and vacation schedule will also be credited to other applicable
benefit programs except for Quarter Century Club membership and service pin
entitlements.

Normally, we provide two weeks of paid vacation after one year of full time
employment, three weeks after thirteen years, four weeks after twenty years, and
five weeks after twenty-five years. In your case, we will credit you with the
same twenty-seven year period referenced above; thus, you will be entitled to
five weeks of vacation during your first year.

1
<PAGE> 2

Yours very truly,

DONALD F. HASTINGS
Chairman & Chief Executive Officer

ACCEPTED:

---------------------------------------------------------
Jay Elliott

---------------------------------------------------------
Date

<PAGE> 1

EXHIBIT 10(G)

February 22, 1995

Frederick G. Stueber, Esq.
2253 Delamere Drive
Cleveland Heights, Ohio 44106

Dear Fred:

It is with pleasure that we extend to you an offer to join The Lincoln
Electric Company. Your position would be Vice President, General Counsel and
Secretary and you would report to me.

Your compensation will include an annual base salary of $200,000, payable
according to our standard payroll schedule. Such salary will be subject to our
normal area wage index, except for any periods during which the then current
indexed salary would be reduced. For such periods, the salary paid will be
unchanged until the multiplier causes the indexed salary to exceed the salary
being paid.

The monthly premiums for basic medical insurance as offered to Lincoln
employees generally will be paid by the Company. All employees of the Company,
unless they are on a spousal waiver, may select from one of the following plans:
(Super Blue) Blue Cross/Blue Shield, QualChoice, HMO Health Ohio, or Kaiser. At
the present time, the monthly premiums for family plans vary from $367.84 to
$462.24 depending on the plan selected.

The Lincoln Electric Company will provide you with $10,000 of term life
insurance. You may optionally subscribe to an additional $40,000 of term life at
your expense and at a rate available to other Lincoln Electric employees. Our
employees pay the accidental death and dismemberment provision of the
company-paid life insurance, as well as any contributory insurance. In your case
this would amount to $18.50 per month in the form of a payroll deduction. You
will also be included in a $750,000 accidental death insurance program, with
lesser payments for other consequences as a result of an accident.

You will participate in the Lincoln Electric retirement annuity program in
the same manner as other employees of the Company. Additionally, you will
participate in a non-qualified, non-funded Supplemental Executive Retirement
Plan (SERP), which includes an accrual opportunity for forty years of service
with the Company and normal retirement at age 65 or later. In this regard, we
will credit you with seventeen years at your starting date. The plan is designed
to provide at age 65, 65 percent of the average income of the three best years
out of the previous seven. The 65 percent will be made up of: our qualified
plan, social security and retirement benefits under any retirement or annuity
program provided by previous employers (but not including self-employment) and
our non-qualified plan. The applicable terms and conditions of the Plan, as
approved by the Board of Directors in September 1994, will be made available to
you.

We will also credit you with the same seventeen year period referenced
above for purposes of the Company's vacation program. Normally, we provide two
weeks of paid vacation after one year of full time employment, three weeks after
thirteen years, four weeks after twenty years, and five weeks after twenty-five
years. Thus, you will be entitled to three weeks of vacation during your first
year. The seventeen years' credit relating to the Supplemental Executive
Retirement Plan and vacation schedule will also be credited to all other
applicable benefit programs (excluding Quarter Century Club membership and
service pin entitlements).

You will be eligible to participate in the Company Employee Stock Purchase
Plan and ESOP in the same manner as other qualified Lincoln Electric employees,
i.e., any service and eligibility requirements shall be deemed satisfied from
the first day of employment. You will also be eligible to participate in the
recently adopted 401(k) plan and top-hat deferred compensation plan each in
accordance with its terms.

You have indicated that the ability to participate meaningfully in equity
ownership plans is an important term of your employment, and you will receive an
initial award of 2,500 shares of Restricted Stock under the Company's 1988
Incentive Equity Plan. The award will vest in installments of 25 percent each on
the third

1
<PAGE> 2

through sixth anniversaries of your employment date and will be on the other
terms contained in the form of award agreement attached as Appendix A.

Although the Company will not be obligated to continue your employment for
any period, you will be entitled to severance pay if the Company terminates your
employment without cause. "Cause" for purposes of this paragraph means
commission of an act that constitutes a felony. The amount of severance pay will
be equal to three times your base salary as in effect at the time of termination
(increased by any bonus paid in the preceding year) if that termination occurs
before the Restricted Stock is fully vested. Thereafter, through your tenth
anniversary, the amount of severance pay will be equal to your base salary as in
effect at the time of termination (increased by any bonus paid in the preceding
year). However, any amount payable will be subject to reduction as necessary so
that no amount you receive from the Company will be subject to the excise tax
imposed on "parachute payments" by Section 4999 of the Internal Revenue Code.
This severance pay arrangement will also apply if there is a Change in Control
(as defined in the attached form of Restricted Stock Agreement) of the Company
and your employment is terminated before the tenth anniversary of your
employment date, but only if your employment is terminated by the Company or its
successor without cause (as defined above) or if you decide to terminate your
employment because of a significant reduction in your compensation, position or
duties or because the principal location of your work is moved more than 25
miles from Cleveland.

Should the Board of Directors decide in the future that other change in
control provisions are necessary in certain employment agreements to ensure
continuity of management, you will be considered a key officer for possible
inclusion in lieu of the foregoing arrangement if you so desire. You will also
be entitled to the benefits of the Company's standard Indemnification Agreement
for officers in the form attached as Appendix B.

On or before your second anniversary with Lincoln, we will review with you
the terms of your employment for the purpose of developing a new base salary and
incentive compensation package that is consistent with the incentive policies
applicable to Lincoln Electric officers and employees generally. At that time,
it will be determined whether it would be appropriate for you to join in the
Lincoln cash bonus program that is available to other employees or participate
in some other incentive compensation arrangement. Our expectation is that we
would work out a new overall compensation package, but that your total expected
cash compensation at that point will be at least equal to your then existing
base salary. If you join the bonus program at that time, medical insurance will
cease to be paid by the Company; rather, the cost will be deducted from your
bonus, as is the case with our employees who receive a bonus who are not
otherwise covered by a spousal waiver.

You have indicated that your ability to perform as an effective General
Counsel will be facilitated by the availability of various support services that
are itemized on Appendix C. The Company agrees with your assessment and
authorizes you, effective upon your employment, to arrange for such services.

Naturally, this offer of employment is subject to approval of its terms by
the Compensation Committee and to action by the Board of Directors electing you
to the offices specified above. It is contemplated that your employment would
begin upon receipt of these approvals in February and that the award of
Restricted Stock and Indemnification Agreement would thereupon be immediately
effective.

We look forward to a long and productive relationship.

Sincerely,

Chairman and Chief Executive Officer

ACCEPTED:

------------------------------------------------------

------------------------------------------------------
Date

2
<PAGE> 3

APPENDIX C

LEGAL SUPPORT SERVICES

1. The employment of a legal secretary who meets both the standards of the
General Counsel as well as prevailing Company standards. Approximate base
salary of $30,000, with two weeks paid vacation.

2. Adequate LAN word processing and computer systems for in-house lawyers,
compatible with existing Company systems and reasonably priced.

3. The employment, at a competitive rate, of at least one additional part-time
lawyer, experienced in private practice, to facilitate efficient in-house
services.

4. Funds to provide basic in-house reference materials, as determined by the
General Counsel.

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APPENDIX A

THE LINCOLN ELECTRIC COMPANY

RESTRICTED STOCK AGREEMENT

WHEREAS, Frederick G. Stueber (hereinafter called the "Grantee") is a key
employee of The Lincoln Electric Company, (hereinafter called the "Company");
and

WHEREAS, this award of Restricted Stock to the Grantee pursuant to the
Company's 1988 Incentive Equity Plan (the "Plan") and the execution of a
Restricted Stock Agreement (hereinafter called the "Agreement") substantially in
the form hereof were authorized previously by the Compensation Committee of the
Company's Board of Directors, effective on the date of execution (the "Date of
Grant").

NOW, THEREFORE, the Company, pursuant to its 1988 Incentive Equity Plan
(the "Plan"), has this day granted (the "Date of Grant") to the Grantee, a total
of Two Thousand Five Hundred (2,500) shares of Common Stock, without par value
("Common Stock"), of the Company subject to the terms and conditions of the Plan
and the following terms, conditions, limitations and restrictions:

1. The Common Stock subject to this grant shall be fully paid and
nonassessable and shall be represented by a certificate or certificates
registered in the Grantee's name, endorsed with an appropriate legend referring
to the restrictions hereinafter set forth. The Grantee shall have all the rights
of a stockholder with respect to such stock, including the right to vote the
stock and to receive all dividends paid thereon, provided that such stock,
together with any additional stock which the Grantee may become entitled to
receive by virtue of a stock dividend, a merger or reorganization in which the
Company is the surviving company or any other change in the capital structure
shall be subject to the restrictions hereinafter set forth. As long as any of
the shares of Common Stock subject to this grant are subject to the risk of
forfeiture referred to in Section 2 hereof, the Company may, at its option,
require the Grantee to exchange any of the shares received pursuant to this
Agreement (together with any such additional shares) for shares of any other
class of common equity of the Company having the same aggregate fair market
value.

2. The Common Stock subject to this grant shall be subject to forfeiture in
the event of the termination of the Grantee's employment with the Company. Such
risk of forfeiture shall lapse as to one fourth of the Shares of Common Stock
covered hereby upon the third, fourth, fifth and sixth anniversaries of the Date
of Grant. Shares of Common Stock that are subject to such risk of forfeiture may
not be sold, exchanged, assigned, transferred, pledged or otherwise disposed of
by the Grantee except to the Company. Any purported transfer in violation of the
provisions of this section shall be void, and the purported transferee shall
obtain no rights with respect to such stock.

3. If the Grantee's employment with the Company is terminated before the
sixth anniversary of the Date of Grant other than as a result of the Grantee's
death or disability, the shares of Common Stock subject to this grant with
respect to which the restrictions referred to in Section 2 hereof remain in
effect shall be forfeited to the Company. If the Grantee's employment with the
Company is terminated before the sixth anniversary of the Date of Grant as a
result of the Grantee's death or Disability, the restrictions referred to in
Section 2 hereof shall immediately thereupon lapse and terminate.

4. During the period in which the transferability and forfeiture
restrictions provided in Section 2 hereof are in effect, the certificates
representing the Common Stock covered by this grant shall be retained by the
Company, together with the accompanying stock power signed by the Grantee and
endorsed in blank.

5. In the event of a "Change in Control" as hereinafter defined, the
restrictions on the Common Stock subject to this grant provided in Section 2
hereof shall thereupon lapse and terminate. For the purposes of this section, a
Change in Control shall occur upon the happening of any of the following events:

(a) The Company is merged or consolidated or reorganized into or with
another company or other legal person, and as a result of such merger,
consolidation or reorganization less than a majority of the

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combined voting power of the then-outstanding securities of such company or
person immediately after such transaction is held in the aggregate by the
holders of the then outstanding securities entitled to vote generally in
election of the directors of the Company ("Voting Stock") of the Company
immediately prior to such transaction;

(b) The Company sells or otherwise transfers all or substantially all
of its assets to any other company or other legal person, and as a result
of such sale or transfer less than a majority of the combined voting power
of the then-outstanding securities of such company or person immediately
after such sale or transfer is held in the aggregate by the holders of
Voting Stock of the Company immediately prior to such sale or transfer; or

(c) Any person or group of persons (within the meaning of Section 13
or 14 of the Securities Exchange Act of 1934, as amended) shall have
acquired beneficial ownership (within the meaning of Rule 13d-3 promulgated
by the Securities and Exchange Commission under said Act) of 30% or more of
the outstanding capital stock of the Company having voting power in the
general election of directors, excluding (i) any Person or group of Persons
who are officers, directors or employees of the Company or any Subsidiary
as of the date hereof or are related by blood or marriage to the
descendants of James F. or John C. Lincoln, including any trusts or similar
arrangements for any of the foregoing and any foundations established by
any of the foregoing and (ii) any underwriter or syndicate of underwriters
acting on behalf of the Company in a public offering of the Company's
securities and any of their transferees.

6. The Grantee hereby acknowledges that federal and state income, payroll
or other applicable taxes may apply with respect to this grant. If the Company
determines, in its sole discretion, that withholding is required, the Grantee
agrees by the acceptance of this grant that such withholding may be accomplished
through withholding from the cash compensation due to the Grantee from the
Company an amount sufficient to satisfy the full withholding obligation. If
withholding pursuant to the foregoing sentence is insufficient (in the sole
judgment of the Company) to satisfy the full withholding obligation, the Grantee
agrees that either (a) the Grantee will pay over to the Company the amount of
cash necessary to satisfy such remaining withholding obligation by the time
thereafter specified in writing by the Company, or (b) the Company may retain
such number of shares of Common Stock covered by this grant as shall be equal in
value to the amount of the remaining withholding obligation. Upon due notice
from the Grantee, the Company may (in its discretion) satisfy the entire
withholding obligation by retaining stock as provided in (b) above in lieu of
withholding from the Grantee's cash compensation.

7. For purposes of this Agreement, the employment of the Grantee with the
Company shall not be deemed interrupted, and the Grantee shall not be deemed to
have ceased to be an employee of the Company, by reason of the transfer of his
or her employment among the Company and its Subsidiaries.

8. Nothing contained in this Agreement shall limit whatever right the
Company or a Subsidiary might otherwise have to terminate the employment of the
Grantee.

9. Any economic or other benefit to the Grantee under this Agreement or the
Plan shall not be taken into account in determining any benefits to which the
Grantee may be entitled under any profit-sharing, retirement or other benefit or
compensation plan maintained by the Company or a Subsidiary and shall not affect
the amount of any life insurance coverage available to any beneficiary under any
life insurance plan covering employees of the Company or a Subsidiary.

10. Any amendment to the Plan shall be deemed to be an amendment to this
Agreement to the extent that the amendment is applicable hereto; provided,
however, that no amendment shall adversely affect the rights of the Grantee with
respect to the shares of Common Stock or other securities covered by this
Agreement without the Grantee's consent.

11. In the event that one or more of the provisions of this Agreement shall
be invalidated for any reason by a court of competent jurisdiction, any
provision so invalidated shall be deemed to be separable from the other
provisions hereof, and the remaining provisions hereof shall continue to be
valid and fully enforceable.

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12. This Agreement is made under, and shall be construed in accordance
with, the internal substantive laws of the State of Ohio.

13. This Agreement is subject to the terms and conditions of the Plan.
Capitalized terms used herein without definition shall have the meanings
assigned to them in the Plan.

EXECUTED as of the 22nd day of February, 1995.

THE LINCOLN ELECTRIC COMPANY

By: ________________________
Title:

The undersigned Grantee hereby acknowledges receipt of an executed original
of this Restricted Stock Agreement and accepts the Restricted Stock granted
thereunder.

Dated: __________________________ ____________________________
(Grantee)

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EXHIBIT B TO THIS AGREEMENT IS THE FORM OF INDEMNIFICATION AGREEMENT SUBMITTED
HEREWITH AS EXHIBIT 10(B) AND HAS NOT BEEN REFILED WITH THIS AGREEMENT.

<PAGE> 1

EXHIBIT 10(H)

RELEASE AND SETTLEMENT AGREEMENT

THIS RELEASE AND SETTLEMENT AGREEMENT (this "Agreement") is made and
entered into by and between THE LINCOLN ELECTRIC COMPANY (the "Company," a term
which in this Agreement shall include its predecessors, parents, subsidiaries,
divisions, related or affiliated companies, officers, directors, stockholders,
members, employees, heirs, successors, assigns, representatives, agents and
counsel, unless the context otherwise clearly requires), and ROGER F. YOUNG
("Young"),

WITNESSETH:

WHEREAS, Young is an employee of the Company and currently serves as Senior
Vice President, Administration and as a Director of the Company;

WHEREAS, the Company and Young have determined that Young shall resign and
retire from any and all positions he may hold as an officer, director and
employee of, and any other positions he may hold with respect to, the Company,
effective July 31, 1994 (the "Effective Date");

WHEREAS, the Company and Young desire to make provision for the payments
and benefits that Young will be entitled to receive from the Company in
consideration for Young's obligations and actions under this Agreement and in
connection with such resignations and retirement and the cessation of his
employment with the Company; and

WHEREAS, the Company and Young wish to resolve, settle and/or compromise
any and all matters, claims and issues between them arising from or relating to
Young's service and employment with the Company, including the termination
thereof;

NOW THEREFORE, in consideration of the promises and agreements contained
herein and other good and valuable consideration, the sufficiency and receipt of
which are hereby acknowledged, and intending to be legally bound, the Company
and Young agree as follows:

1. RESIGNATION. Young hereby resigns and retires from his employment with
the Company, and its subsidiaries and related or affiliated companies, as of the
Effective Date. Young also resigns, as of the Effective Date, (a) from the Board
of Directors of the Company, and from the Board of Directors of any entity that
is a subsidiary of, or is otherwise related to or affiliated with, the Company,
(b) from all offices of the Company to which he has been elected by the Board of
Directors of the Company (or to which he has otherwise been appointed), (c) from
all offices of any entity that is a subsidiary of, or is otherwise related to or
affiliated with, the Company and (d) from all administrative, fiduciary or other
positions he may hold with respect to arrangements or plans for, of or relating
to the Company. The Company hereby consents to and accepts said resignations as
of the Effective Date, and the Company records shall so reflect.

2. PAYMENTS. (a) In consideration of the promises of Young in this
Agreement and subject to the conditions hereof, the Company shall:

(i) Pay Young (X) on the 15th and last day of each month for five (5)
months commencing on August 15, 1994 and ending on December 31, 1994 a
gross amount of FOUR THOUSAND EIGHT HUNDRED FORTY-THREE DOLLARS ($4,843.00)
and (Y) on the 15th and last day of each month for twenty-four (24) months
commencing on January 15, 1995 and ending on December 31, 1996 a gross
amount of EIGHT THOUSAND, SIX HUNDRED SIX & 89/100 DOLLARS ($8,606.89);
provided that the continuance of such payments is contingent upon Young's
compliance with the requirements of this Agreement applicable to him; and
provided further that if Young dies before the completion of the payments
described in this subparagraph 2(a)(i), the remaining payments described in
this subparagraph 2(a)(i) following his death shall be made to his estate.

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<PAGE> 2

(ii) Pay Young (or his estate in the event of his death before
December 31, 1994) on December 31, 1994 a lump sum gross amount equal to
TWO HUNDRED SIX THOUSAND, FIVE HUNDRED SIXTY-FIVE & 22/100 DOLLARS
($206,565.22) reduced by the sum of the gross salary received by Young from
the Company in 1994 and the payments described in subparagraph 2(a)(i)(X)
of this Agreement;

(iii) Pay Young a supplemental pension of NINETEEN THOUSAND, TWO
HUNDRED TWENTY-FIVE DOLLARS ($19,225.00) per year in equal monthly
installments, payable in the form of a single life annuity, commencing with
a payment on January 1, 1997 and ending with a payment on the first day of
the month in which Young dies (the "Pension"); provided that in the event
the Company adopts a supplemental executive retirement plan or similar
arrangement, the Pension may, at the option of the Company, be paid through
such plan or arrangement (but no other benefit shall be payable to or with
respect to Young under any such plan or arrangement); and provided further
that if the Company adopts such a plan or arrangement and if such plan or
arrangement provides for an actuarially equivalent survivor annuity in lieu
of a straight life annuity, Young may elect to receive the Pension in the
form of such actuarially equivalent survivor annuity (such actuarial
equivalence being determined in accordance with the terms of such plan or
arrangement).

(iv) Continue to permit Young to participate in the Company's life
insurance programs, on the same basis that Young has participated in such
life insurance programs prior to the termination of his employment with the
Company, until the earlier of December 31, 1996, or the date on which Young
becomes eligible for other employer-provided life insurance. Young
acknowledges and agrees that he currently is eligible for Medicare and
that, accordingly, his rights to continuation of coverage under the
Company's group health plan pursuant to Part 6 of Subtitle B of Title I of
the Employee Retirement Income Security Act of 1974, as amended ("COBRA"),
will cease upon his resignation and retirement under this Agreement.
However, Young will be entitled to participate in the Company program
through which retirees, at their cost (as determined by the Company), may
elect to have coverage under the Company's medical program that is
secondary to Medicare.

(b) Young acknowledges and agrees that he shall be responsible for his
share of any and all Federal, State and/or local taxes applicable to the
payments made, and benefits provided or made available, to Young pursuant to
this Paragraph 2 and further agrees to indemnify the Company against any
liability as a result of those taxes.

(c) The payments to Young pursuant to subparagraphs 2(a)(i), 2(a)(ii) and
2(a)(iii) of this Agreement shall be made by check or direct deposit to an
account designated by Young, and shall be reduced by any applicable Federal,
State and local tax or other required withholding. The payments to Young
pursuant to subparagraph 2(a)(i) of this Agreement (and, with respect to medical
insurance for 1994, pursuant to subparagraph 2(a)(ii) of this Agreement) shall
be reduced by any applicable deductions resulting from Young's election to
participate in the Company's medical and/or life insurance programs as described
in subparagraph 2(a)(iv) of this Agreement.

(d) Young acknowledges and agrees that the consideration provided by the
Company to Young under this Agreement, including, without limitation, the
payments and benefits to be made or provided by the Company to Young pursuant to
this Agreement, is greater than and in addition to anything of value to which he
otherwise would be entitled from the Company and that the release by Young set
forth in Paragraph 4 of this Agreement and the obligations of and actions taken
by Young under this Agreement are given and undertaken in consideration of, and
adequately supported by, the payments and benefits to be made or provided to
Young by the Company under and pursuant to this Agreement.

3. PROFESSIONAL FEES. The Company and Young acknowledge and agree that each
shall be responsible for the payment of their respective legal fees and costs
(and related disbursements) incurred in connection with Young's termination and
resignation and all matters relating to the negotiation and execution of this
Agreement.

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<PAGE> 3

4. RELEASE BY YOUNG. (a) Young, for himself and his dependents, successors,
assigns, heirs, executors and administrators (and his and their legal
representatives of every kind), hereby releases, dismisses, remises and forever
discharges the Company from any and all arbitrations, claims, including claims
for attorney's fees, demands, damages, suits, proceedings, actions and/or causes
of action of any kind and every description, whether known or unknown, which
Young now has or may have had for, upon, or by reason of any cause whatsoever
(except that this release shall not apply to the obligations of the Company
arising under this Agreement) ("claims"), against the Company, including but not
limited to:

(i) any and all claims arising out of or relating to Young's
employment by or service with the Company and his termination from the
Company;

(ii) any and all claims of discrimination, including but not limited
to claims of discrimination on the basis of sex, race, age, national
origin, marital status, religion or handicap, including, specifically, but
without limiting the generality of the foregoing, any claims under Title
VII of the Civil Rights Act of 1964, as amended, the Americans with
Disabilities Act, Ohio Revised Code Section 4101.17 and Ohio Revised Code
Chapter 4112, including Sections 4112.02 and 4112.99 thereof; and

(iii) any and all claims of wrongful or unjust discharge or breach of
any contract or promise, express or implied.

(b) Young understands and acknowledges that the Company does not admit any
violation of law, liability or invasion of any of his rights and that any such
violation, liability or invasion is expressly denied. The consideration provided
under this Agreement is made for the purpose of settling and extinguishing all
claims and rights (and every other similar or dissimilar matter) that Young ever
had or now may have against the Company to the extent provided in this Paragraph
4. Young further agrees and acknowledges that no representations, promises or
inducements have been made by the Company other than as appear in this
Agreement.

(i) The release provided for in this Paragraph 4 releases claims to
and including the date of this Agreement;

(ii) He fully understands the terms of this Agreement, and enters into
this Agreement freely, voluntarily and intending to be bound; and

(iii) He has been given a reasonable period of time in which to review
and consider the terms of this Agreement, and the release contained herein,
prior to its execution.

(d) Young agrees that he will never file a lawsuit or other complaint
asserting any claim that is released in this Paragraph 4.

(e) It is understood and agreed that Young's resignation and retirement are
by mutual agreement between the Company and Young, and that Young waives and
releases any claim that he has or may have to reemployment.

5. CONFIDENTIAL INFORMATION. (a) Young acknowledges and agrees that in the
performance of his duties as an officer and employee of the Company he was
brought into frequent contact with, had or may have had access to, and/or became
informed of confidential and proprietary information of the Company and/or
information which is a trade secret of the Company (collectively, "Confidential
Information"), as more fully described in subparagraph (b) of this Paragraph 5.
Young acknowledges and agrees that the Confidential Information of the Company
gained by Young during his association with the Company was developed by and/or
for the Company through substantial expenditure of time, effort and money and
constitutes valuable and unique property of the Company.

(b) Young will keep in strict confidence, and will not, directly or
indirectly, at any time, disclose, furnish, disseminate, make available, use or
suffer to be used in any manner any Confidential Information of the Company
(except as may be necessary in connection with the discharge of Young's
obligations pursuant to

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Paragraph 8 of this Agreement) without limitation as to when or how Young may
have acquired such Confidential Information. Young specifically acknowledges
that Confidential Information includes any and all information, whether reduced
to writing (or in a form from which information can be obtained, translated, or
derived into reasonably usable form), or maintained in the mind or memory of
Young and whether compiled or created by the Company, which derives independent
economic value from not being readily known to or ascertainable by proper means
by others who can obtain economic value from the disclosure or use of such
information, that reasonable efforts have been put forth by the Company to
maintain the secrecy of Confidential Information, that such Confidential
Information is and will remain the sole property of the Company, and that any
retention or use by Young of Confidential Information after the termination of
Young's employment with and services for the Company shall constitute a
misappropriation of the Company's Confidential Information.

(c) Young further agrees that he shall return (to the extent he has not
already returned), within ten (10) days of the Effective Date, in good
condition, all property of the Company, including, without limitation, (i)
property, documents and/or all other materials (including copies, reproductions,
summaries and/or analyses) which constitute, refer or relate to Confidential
Information of the Company, (ii) keys to Company property, (iii) files and (iv)
blueprints or other drawings.

(d) Young further acknowledges and agrees that his obligation of
confidentiality shall survive, regardless of any other breach of this Agreement
or any other agreement, by any party hereto, until and unless such Confidential
Information of the Company shall have become, through no fault of Young,
generally known to the public or Young is required by law (after providing the
Company with notice and opportunity to contest such requirement) to make
disclosure. Young's obligations under this Paragraph 5 are in addition to, and
not in limitation or preemption of, all other obligations of confidentiality
which Young may have to the Company under general legal or equitable principles
or statutes.

6. NON-COMPETITION. (a) Young agrees that for a period of two (2) years
from and after the Effective Date, within the Territory (as described in
subparagraph (b)(i) of this Paragraph 6) (and, as to subparagraph (a)(iii) of
this Paragraph 6, any place), he shall not, directly or indirectly, do or suffer
any of the following:

(i) Own, manage, control or participate in the ownership, management,
or control of, or be employed or engaged by or otherwise affiliated or
associated as a consultant, independent contractor or otherwise with, any
other corporation, partnership, proprietorship, firm, association, or other
business entity, or otherwise engage in any business, which is in
competition with the Company's business (as described in subparagraph
(b)(ii) of this Paragraph 6); provided, however, that the ownership of not
more than one percent (1%) of any class of publicly-traded securities of
any entity shall not be deemed a violation of this Agreement.

(ii) Employ, assist in employing, or otherwise associate in business
with any person who presently is an employee, officer or agent of the
Company, or any of its affiliated, related or subsidiary entities.

(iii) Induce any person who is an employee, officer or agent of the
Company, or any of its affiliated, related, or subsidiary entities to
terminate such relationship.

(b) For purposes of this Agreement:

(i) "Territory" shall mean the countries identified in Exhibit A
hereto.

(ii) The Company's business shall mean the design, manufacture,
distribution and sale of the products identified in Exhibit B hereto.

(c) In the event Young shall violate any provision of this Paragraph 6 as
to which there is a specific time period during which he is prohibited from
taking certain actions or from engaging in certain activities, as set forth in
such provision, then, in such event, such violation shall toll the running of
such time period from the date of such violation until such violation shall
cease.

(d) Young has carefully considered the nature and extent of the
restrictions upon him and the rights and remedies conferred upon the Company
under this Paragraph 6 and this Agreement, and hereby acknowledges

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<PAGE> 5

and agrees that the same are reasonable in time and territory, are designed to
eliminate competition which otherwise would be unfair to the Company, do not
stifle the inherent skill and experience of Young, would not operate as a bar to
Young's sole means of support, are fully required to protect the legitimate
interests of the Company and do not confer a benefit upon the Company
disproportionate to the detriment to Young.

7. DISCLOSURE. Young, for a period of two (2) years from and after the
Effective Date, agrees to communicate the contents of Paragraphs 5, 6, 8(b), 9
and 11 of this Agreement to any person, firm, association, or corporation which
he intends to be employed by, associated in business with, or represent.

8. BREACH. (a) If Young breaches any of the provisions of this Agreement,
then the Company may, at its sole option, (1) immediately terminate all
remaining payments and benefits described in subparagraphs 2(a)(i), 2(a)(ii) and
2(a)(iv) of this Agreement and (2) obtain reimbursement from Young of all
payments and benefits already provided pursuant to subparagraphs 2(a)(i),
2(a)(ii) and 2(a)(iv) of this Agreement, plus any expenses and damages incurred
as a result of the breach, with the remainder of this Agreement, and all
promises and covenants herein, remaining in full force and effect.

(b) Young acknowledges and agrees that the remedy at law available to the
Company for breach by Young of any of his obligations under Paragraphs 5 and 6
of this Agreement would be inadequate and that damages flowing from such a
breach would not readily be susceptible to being measured in monetary terms.
Accordingly, Young acknowledges, consents and agrees that, in addition to any
other rights or remedies which the Company may have at law, in equity or under
this Agreement, upon adequate proof of Young's violation of any provision of
Paragraph 5 or 6 of this Agreement, the Company shall be entitled to immediate
injunctive relief and may obtain a temporary order restraining any threatened or
further breach, without the necessity of proof of actual damage.

9. CONTINUED AVAILABILITY AND COOPERATION. (a) Young shall cooperate fully
with the Company and with the Company's counsel in connection with any present
and future actual or threatened litigation or administrative proceeding
involving the Company that relates to events, occurrences or conduct occurring
(or claimed to have occurred) during the period of Young's employment by the
Company. This cooperation by Young shall include, but not be limited to:

(i) making himself reasonably available for interviews and discussions
with the Company's counsel as well as for depositions and trial testimony;

(ii) if depositions or trial testimony are to occur, making himself
reasonably available and cooperating in the preparation therefor as and to
the extent that the Company or the Company's counsel reasonably requests;

(iii) refraining from impeding in any way the Company's prosecution or
defense of such litigation or administrative proceeding; and

(iv) cooperating fully in the development and presentation of the
Company's prosecution or defense of such litigation or administrative
proceeding.

(b) For two (2) years from and after the Effective Date, Young shall
continue to provide cooperation to the Company with respect to projects
undertaken by the Company where Young's prior knowledge with respect to, or
prior involvement in, such or similar projects would be relevant to the
advancement of such projects; provided that such cooperation shall not require
more than twenty (20) days of Young's time per calendar year.

(c) Young shall be reimbursed by the Company for reasonable travel,
lodging, telephone and similar expenses incurred in connection with such
cooperation, which the Company shall reasonably endeavor to schedule at times
not conflicting with the reasonable requirements of any future employer of
Young, or with the requirements of any third party with whom Young has a
business relationship that provides remuneration to Young. Young shall not
unreasonably withhold his availability for such cooperation.

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10. SUCCESSORS AND BINDING AGREEMENT. (a) This Agreement shall be binding
upon and inure to the benefit of the Company and any successor of or to the
Company, including, without limitation, any persons acquiring directly or
indirectly all or substantially all of the business and/or assets of the Company
whether by purchase, merger, consolidation, reorganization or otherwise (and
such successor shall thereafter be deemed included in the definition of "the
Company" for purposes of this Agreement), but shall not otherwise be assignable
or delegable by the Company.

(b) This Agreement shall inure to the benefit of and be enforceable by
Young's personal or legal representatives, executors, administrators,
successors, heirs, distributees and/or legatees.

(c) This Agreement is personal in nature and none of the parties hereto
shall, without the consent of the other parties, assign, transfer or delegate
this Agreement or any rights or obligations hereunder except as expressly
provided in subparagraphs (a) and (b) of this Paragraph 10.

(d) This Agreement is intended to be for the exclusive benefit of the
parties hereto, and except as provided in subparagraphs (a) and (b) of this
Paragraph 10, no third party shall have any rights hereunder.

11. NON-DISCLOSURE; STATEMENTS TO THIRD PARTIES. (a) Except to the extent
that this Agreement or the terms hereof become publicly known or available
because of legally mandated disclosure and filing requirements of the Securities
and Exchange Commission, or because of any other legal requirement that this
Agreement or the terms hereof be disclosed or filed with a governmental
instrumentality or agency, all provisions of this Agreement and the
circumstances giving rise hereto are and shall remain confidential and shall not
be disclosed to any person not a party hereto (other than (i) Young's spouse,
(ii) each party's attorney, financial advisor and/or tax advisor to the extent
necessary for such advisor to render appropriate legal, financial and tax
advice, and (iii) persons or entities that fall within the scope of Paragraph 7
of this Agreement, but only to the extent required thereby), except as necessary
to carry out the provisions of this Agreement, and except as may be required by
law.

(b) Because the purpose of this Agreement is to settle amicably any and all
potential disputes or claims among the parties, neither Young nor the Company
shall, directly or indirectly, make or cause to be made any statements to any
third parties criticizing or disparaging the other or commenting on the
character or business reputation of the other. Young further hereby agrees not
(1) to comment to others concerning the status, plans or prospects of the
business of the Company, or (2) to engage in any act or omission that would be
detrimental, financially or otherwise, to the Company, or that would subject the
Company to public disrespect, scandal or ridicule.

12. NOTICES. For all purposes of this Agreement, all communications
provided for herein shall be in writing and shall be deemed to have been duly
given when delivered, addressed to the Company (to the attention of the Vice
President of Human Resources) at its principal executive offices and to Young at
his principal residence, 33960 Meadow Lane, Chagrin Falls, OH 44022, or to such
other address as any party may have furnished to the other in writing and in
accordance herewith. Notices of change of address shall be effective only upon
receipt.

13. MISCELLANEOUS. The death or disability of Young following the execution
of this Agreement shall not affect or revoke this Agreement or any of the
obligations of the parties hereto. No provision of this Agreement may be
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in writing signed by Young and the Company. No waiver by either party
hereto at any time of any breach by the other party hereto or compliance with
any condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time. No agreements or representations,
oral or otherwise, expressed or implied with respect to the subject matter
hereof have been made by any of the parties that are not set forth expressly in
this Agreement and every one of them (if, in fact, there have been any) is
hereby terminated without liability or any other legal effect whatsoever.

6
<PAGE> 7
communications, understandings, commitments, representations or warranties,
whether oral or written, by any party hereto or any of its representatives
pertaining to such subject matter.

15. GOVERNING LAW. The validity, interpretation, construction and
performance of this Agreement shall be governed by the substantive laws of the
State of Ohio, without giving effect to the principles of conflict of laws of
such state.

16. VALIDITY. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement which shall nevertheless remain in full force and effect.

17. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same Agreement.

18. CAPTIONS AND PARAGRAPH HEADINGS. Captions and paragraph headings used
herein are for convenience and are not part of this Agreement and shall not be
used in construing it.

19. FURTHER ASSURANCES. Each party hereto shall execute such additional
documents, and do such additional things, as may reasonably be requested by the
other party to effectuate the purposes and provisions of this Agreement.

[This space intentionally left blank.]

IN WITNESS WHEREOF, the parties have executed and delivered this Agreement
on the last date set forth below.

THE LINCOLN ELECTRIC COMPANY

By: _________________________
Donald F. Hastings
Chairman of the Board and
Chief Executive Officer

Date: ___________________

Witness: ________________________ _________________________
ROGER F. YOUNG

Date: ___________________

7
<PAGE> 8

EXHIBIT A

United States
Canada
Mexico
Brazil
Venezuela
England
France
Germany
Ireland
Italy
Japan
Netherlands
Norway
Spain
Australia

1
<PAGE> 9

EXHIBIT B

I. Arc Welding Machines ranging from light duty models for light industrial
and farm use to heavy duty models for commercial and industrial use in
manual, semi-automatic, automatic and robotic welding.

II. Arc Welding Consumables: Welding rods, fluxes and wires used in light to
heavy manufacturing of mild steel, alloy and hard surface applications;
coated manual or stick electrodes; solid electrodes produced in coil form
for continuous feeding in mechanized welding; cored electrodes produced in
coil form for continuous feeding in mechanized welding; submerged arc
electrodes and fluxes; self-shielded cored electrodes; gas-shielded solid
and cored electrodes.

III. Arc Welding Power Sources and Automated Wire Feeding Systems.

<PAGE> 1

EXHIBIT 10(i)

RELEASE AND SETTLEMENT AGREEMENT

WITNESSETH:

WHEREAS, Gonzalez is an employee of, and serves as a Director of the
Company;

WHEREAS, the Company and Gonzalez have determined that Gonzalez shall
resign and retire from any and all positions he may hold as an officer or
director of, and any other positions he may hold with respect to, the Company,
effective August 31, 1994, and that Gonzalez shall resign and retire as an
employee of the Company and its subsidiaries and related or affiliated companies
effective November 15, 1994;

WHEREAS, the Company and Gonzalez desire to make provision for the payments
and benefits that Gonzalez will be entitled to receive from the Company in
consideration for Gonzalez's obligations and actions under this Agreement and in
connection with such resignations and retirement and the cessation of his
employment with the Company; and

WHEREAS, the Company and Gonzalez wish to resolve, settle and/or compromise
any and all matters, claims and issues between them arising from or relating to
Gonzalez's service and employment with the Company, including the termination
thereof;

1. RESIGNATION. Gonzalez hereby resigns and retires from his
employment with the Company, and its subsidiaries and related or affiliated
companies, as of November 15, 1994. Gonzalez also resigns, as of August 31,
1994, (a) from the Board of Directors of the Company, and from the Board of
Directors of any entity that is a subsidiary of, or is otherwise related to
or affiliated with the Company (and Gonzalez hereby waives notice of any
meeting of any such Board of Directors after August 31, 1994), (b) from all
offices of the Company to which he has been elected by the Board of
Directors of the Company (or to which he has otherwise been appointed), (c)
from all offices of any entity that is a subsidiary of, or is otherwise
related to or affiliated with, the Company and (d) from all administrative,
fiduciary or other positions he may hold with respect to arrangements or
plans for, of or relating to the Company. The Company hereby consents to
and accepts said resignations, and the Company records shall so reflect.

2. PAYMENTS. (a) In consideration of the promises of Gonzalez in this
Agreement and subject to the conditions hereof, including without limitation
Paragraph 4 of this Agreement, the Company shall:

(i) Pay Gonzalez a gross total amount of FOUR HUNDRED EIGHTY-ONE
THOUSAND DOLLARS ($481,000) in accordance with the following schedule:

<TABLE>
<S> <C>
November 30, 1994.................... $ 10,000
December 15, 1994.................... $ 10,000
December 31, 1994.................... $161,000
July 1, 1995......................... $300,000
</TABLE>

provided that (a) no such payment shall be made unless and until the
conditions in Paragraph 4 below have been satisfied, (b) the continuance of
such payments is contingent upon Gonzalez's compliance with the
requirements of this Agreement applicable to him and (c) if Gonzalez dies
before the

1
<PAGE> 2

completion of the payments described in this subparagraph 2(a)(i), the
remaining payments described in this subparagraph 2(a)(i) following his
death shall be made to his estate.

(ii) Pay Gonzalez a supplemental pension of TWENTY-EIGHT THOUSAND,
NINE HUNDRED FORTY-EIGHT DOLLARS ($28,948.00) per year, in equal monthly
installments, payable in the form of a single life annuity, commencing with
a payment on January 1, 1997 and ending with a payment on the first day of
the month in which Gonzalez dies (the "Pension"); provided that (a) no such
payment shall be made unless the conditions in Paragraph 4 of this
Agreement have been satisfied, (b) the continuance of such payments is
contingent upon Gonzalez's compliance with the requirements of this
Agreement applicable to him, and (c) that the Pension may, at the option of
the Company, be paid through the Company's Supplemental Executive
Retirement Plan (but no other benefit shall be payable to or with respect
to Gonzalez under such plan); and provided further that Gonzalez may elect
to receive the Pension in the form of an actuarially equivalent survivor
annuity in lieu of a straight life annuity (such actuarial equivalence
being determined in accordance with the terms of the Company's Supplemental
Executive Retirement Plan).

(iii) Pay Gonzalez, eight days after the execution of this Agreement,
a lump sum amount equal to FIFTY THOUSAND DOLLARS ($50,000), provided that
if Gonzalez dies before receiving the payment described in this
subparagraph 2(a)(iii), such payment shall be made to his estate.

(iv) Continue to permit Gonzalez to participate in the Company's
medical and life insurance programs until the earlier of December 31, 1996,
or the date on which Gonzalez becomes eligible for other employer-provided
medical insurance or life insurance (whether through a subsequent employer
of Gonzalez or through an employer of Gonzalez's spouse), or, in the case
of medical insurance, the date on which Gonzalez becomes eligible for
Medicare, on the following bases: (i) Gonzalez will be permitted to
continue to participate in the Company's life insurance programs on the
same basis that Gonzalez has participated in such life insurance programs
prior to the termination of his employment with the Company; (ii) Gonzalez
will be permitted to continue to participate in the Company's medical
insurance program through December 31, 1994 on the same basis that Gonzalez
has participated in such medical insurance program prior to the termination
of his employment with the Company; and (iii) after December 31, 1994 and
until Gonzalez's participation in the Company's medical insurance program
terminates as provided herein, Gonzalez will be required, in order to
continue such medical insurance, to make payments to the Company each month
equal to the cost (not to exceed the Company's COBRA premium rate) of such
medical insurance, failure to make timely monthly payments by Gonzalez
resulting in the termination of such medical insurance. Gonzalez
acknowledges and agrees that his rights hereunder with respect to medical
insurance satisfy his rights to continuation of coverage under the
Company's group health plan pursuant to Part 6 of Subtitle B of Title I of
the Employee Retirement Income Security Act of 1974, as amended ("COBRA"),
provided that if Gonzalez revokes his acceptance of this Agreement pursuant
to Paragraph 4 of this Agreement, the Company shall be obligated to provide
Gonzalez only with the opportunity to purchase medical insurance pursuant
to the requirements of COBRA. In addition, following the time that Gonzalez
becomes eligible for Medicare, he will be entitled to participate in the
Company's program through which retirees, at their cost (as determined by
the Company), may elect to have coverage under the Company's medical
program that is secondary to Medicare.

(v) Reimburse Gonzalez, for a period of three months, for the costs of
an outplacement service reasonably acceptable to the Company.

(b) Gonzalez acknowledges and agrees that he shall be responsible for his
share of any and all Federal, State and/or local taxes applicable to the
payments made, and benefits provided or made available, to Gonzalez pursuant to
this Paragraph 2 and further agrees to indemnify the Company against any
liability as a result of those taxes.

(c) The payments to Gonzalez pursuant to subparagraphs 2(a)(i), 2(a)(ii)
and 2(a)(iii) of this Agreement shall be made by check or direct deposit to an
account designated by Gonzalez. Although the Company understands that Gonzalez
maintains these payments are not subject to any withholding for Federal,

2
<PAGE> 3

State or local tax, it retains the right to withhold any federal, state or local
tax amounts which it believes appropriate at the time of such payment. For 1994,
the payments to Gonzalez pursuant to subparagraph 2(a)(i) of this Agreement
shall be reduced by any applicable deductions resulting from Gonzalez's election
to participate in the Company's medical and/or life insurance programs as
described in subparagraph 2(a)(iv) of this Agreement.

(d) Gonzalez acknowledges and agrees that the consideration provided by the
Company to Gonzalez under this Agreement, including, without limitation, the
payments and benefits to be made or provided by the Company to Gonzalez pursuant
to this Agreement, is greater than and in addition to anything of value to which
he otherwise would be entitled from the Company and that the release by Gonzalez
set forth in Paragraph 4 of this Agreement and the obligations of and actions
taken by Gonzalez under this Agreement are given and undertaken in consideration
of, and adequately supported by, the payments and benefits to be made or
provided to Gonzalez by the Company under and pursuant to this Agreement.

3. PROFESSIONAL FEES. The Company and Gonzalez acknowledge and agree that
each shall be responsible for the payment of their respective legal fees and
costs (and related disbursements) incurred in connection with Gonzalez's
termination and resignation and all matters relating to the negotiation and
execution of this Agreement.

4. RELEASE BY GONZALEZ. (a) Gonzalez, for himself and his dependents,
successors, assigns, heirs, executors and administrators (and his and their
legal representatives of every kind), hereby releases, dismisses, remises and
forever discharges the Company from any and all arbitrations, claims, including
claims for attorney's fees, demands, damages, suits, proceedings, actions and/or
causes of action of any kind and every description, whether known or unknown,
which Gonzalez now has or may have had for, upon, or by reason of any cause
whatsoever (except that this release shall not apply to the obligations of the
Company arising under this Agreement) ("claims"), against the Company, including
but not limited to:

(i) any and all claims arising out of or relating to Gonzalez's
employment by or service with the Company and his termination from the
Company;

(ii) any and all claims of discrimination, including but not limited
to claims of discrimination on the basis of sex, race, age, national
origin, marital status, religion or handicap, including, specifically, but
without limiting the generality of the foregoing, any claims under the Age
Discrimination in Employment Act, as amended, Title VII of the Civil Rights
Act of 1964, as amended, the Americans with Disabilities Act, Ohio Revised
Code Section 4101.17 and Ohio Revised Code Chapter 4112, including Sections
4112.02 and 4112.99 thereof; and

(iii) any and all claims of wrongful or unjust discharge or breach of
any contract or promise, express or implied.

(b) Gonzalez understands and acknowledges that the Company does not admit
any violation of law, liability or invasion of any of his rights and that any
such violation, liability or invasion is expressly denied. The consideration
provided under this Agreement is made for the purpose of settling and
extinguishing all claims and rights (and every other similar or dissimilar
matter) that Gonzalez ever had or now may have against the Company to the extent
provided in this Paragraph 4. Gonzalez further agrees and acknowledges that no
representations, promises or inducements have been made by the Company other
than as appear in this Agreement.

(i) The release provided for in this Paragraph 4 releases claims to
and including the date of this Agreement;

(ii) He has been advised by the Company to consult with legal counsel
prior to executing this Agreement and the release provided for in this
Paragraph 4, has had an opportunity to consult with and to be advised by
legal counsel of his choice, fully understands the terms of this Agreement,
and enters into this Agreement freely, voluntarily and intending to be
bound;

3
<PAGE> 4

(iii) He has been given a period of twenty-one (21) days to review and
consider the terms of this Agreement, and the release contained herein,
prior to its execution and that any terms included in this Agreement that
differ from the written proposal made to Gonzalez on August 23, 1994 are
consistent with that written proposal; and

(iv) He may, within seven (7) days after execution, revoke this
Agreement. Revocation shall be made by delivering a written notice of
revocation to the Vice President of Human Resources at the Company. For
such revocation to be effective, written notice must be actually received
by the Vice President of Human Resources at the Company no later than the
close of business on the seventh (7th) day after Gonzalez executes this
Agreement. If Gonzalez does exercise his right to revoke this Agreement,
all of the terms and conditions of the Agreement shall be of no force and
effect and the Company shall not have any obligation to make payments or
provide benefits to Gonzalez as set forth in Paragraph 2 of this Agreement,
except as may be required under COBRA.

(d) Gonzalez agrees that he will never file a lawsuit or other complaint
asserting any claim that is released in this Paragraph 4.

(e) It is understood and agreed that Gonzalez's resignation and retirement
are by mutual agreement between the Company and Gonzalez, and that Gonzalez
waives and releases any claim that he has or may have to reemployment.

5. CONFIDENTIAL INFORMATION. (a) Gonzalez acknowledges and agrees that in
the performance of his duties as an officer and employee of the Company he was
brought into frequent contact with, had or may have had access to, and/or became
informed of confidential and proprietary information of the Company and/or
information which is a trade secret of the Company (collectively, "Confidential
Information"), as more fully described in subparagraph (b) of this Paragraph 5.
Gonzalez acknowledges and agrees that the Confidential Information of the
Company gained by Gonzalez during his association with the Company was developed
by and/or for the Company through substantial expenditure of time, effort and
money and constitutes valuable and unique property of the Company.

(b) Gonzalez will keep in strict confidence, and will not, directly or
indirectly, at any time, disclose, furnish, disseminate, make available, use or
suffer to be used in any manner any Confidential Information of the Company
(except as may be necessary in connection with the discharge of Gonzalez's
obligations pursuant to Paragraph 8 of this Agreement) without limitation as to
when or how Gonzalez may have acquired such Confidential Information. Gonzalez
specifically acknowledges that Confidential Information includes any and all
information, whether reduced to writing (or in a form from which information can
be obtained, translated, or derived into reasonably usable form), or maintained
in the mind or memory of Gonzalez and whether compiled or created by the
Company, which derives independent economic value from not being readily known
to or ascertainable by proper means by others who can obtain economic value from
the disclosure or use of such information, that reasonable efforts have been put
forth by the Company to maintain the secrecy of Confidential Information, that
such Confidential Information is and will remain the sole property of the
Company, and that any retention or use by Gonzalez of Confidential Information
after the termination of Gonzalez's employment with and services for the Company
shall constitute a misappropriation of the Company's Confidential Information.

(c) Gonzalez further agrees that he shall return (to the extent he has not
already returned), within ten (10) days of the Effective Date, in good
condition, all property of the Company, including, without limitation, (i)
property, documents and/or all other materials (including copies, reproductions,
summaries and/or analyses) which constitute, refer or relate to Confidential
Information of the Company, (ii) keys to Company property, (iii) files and (iv)
blueprints or other drawings.

(d) Gonzalez further acknowledges and agrees that his obligation of
confidentiality shall survive, regardless of any other breach of this Agreement
or any other agreement, by any party hereto, until and unless such Confidential
Information of the Company shall have become, through no fault of Gonzalez,
generally known to the public or Gonzalez is required by law (after providing
the Company with notice and opportunity to contest such requirement) to make
disclosure. Gonzalez's obligations under this Paragraph 5 are in addition

4
<PAGE> 5

to, and not in limitation or preemption of, all other obligations of
confidentiality which Gonzalez may have to the Company under general legal or
equitable principles or statutes.

6. NON-COMPETITION. (a) Gonzalez agrees that from and after the date of
this Agreement through August 31, 1996, within the Territory (as described in
subparagraph (b)(i) of this Paragraph 6) (and, as to subparagraph (a)(iii) of
this Paragraph 6, any place), he shall not, directly or indirectly, do or suffer
any of the following:

(iii) Induce any person who is an employee, officer or agent of the
Company, or any of its affiliated, related, or subsidiary entities to
terminate such relationship.

(b) For purposes of this Agreement:

(i) "Territory" shall mean the countries identified in Exhibit A
hereto.

(ii) The Company's business shall mean the design, manufacture,
distribution and sale of the products identified in Exhibit B hereto.

(c) In the event Gonzalez shall violate any provision of this Paragraph 6
as to which there is a specific time period during which he is prohibited from
taking certain actions or from engaging in certain activities, as set forth in
such provision, then, in such event, such violation shall toll the running of
such time period from the date of such violation until such violation shall
cease.

(d) Gonzalez has carefully considered the nature and extent of the
restrictions upon him and the rights and remedies conferred upon the Company
under this Paragraph 6 and this Agreement, and hereby acknowledges and agrees
that the same are reasonable in time and territory, are designed to eliminate
competition which otherwise would be unfair to the Company, do not stifle the
inherent skill and experience of Gonzalez, would not operate as a bar to
Gonzalez's sole means of support, are fully required to protect the legitimate
interests of the Company and do not confer a benefit upon the Company
disproportionate to the detriment to Gonzalez.

7. DISCLOSURE. Gonzalez, from and after the date of this Agreement through
August 31, 1996, agrees to communicate the contents of Paragraphs 5, 6, 8(b), 9
and 11 of this Agreement to any person, firm, association, or corporation which
he intends to be employed by, associated in business with, or represent.

8. BREACH. (a) If Gonzalez breaches any of the provisions of this
Agreement, then the Company may, at its sole option, (1) immediately terminate
all remaining payments and benefits described in subparagraphs 2(a)(i), 2(a)(ii)
and 2(a)(iv) of this Agreement and (2) obtain reimbursement from Gonzalez of all
payments and benefits already provided pursuant to subparagraphs 2(a)(i),
2(a)(ii), 2(a)(iii) and 2(a)(iv) of this Agreement, plus any expenses and
damages incurred as a result of the breach, with the remainder of this
Agreement, and all promises and covenants herein, remaining in full force and
effect.

(b) Gonzalez acknowledges and agrees that the remedy at law available to
the Company for breach by Gonzalez of any of his obligations under Paragraphs 5
and 6 of this Agreement would be inadequate and that damages flowing from such a
breach would not readily be susceptible to being measured in monetary terms.
Accordingly, Gonzalez acknowledges, consents and agrees that, in addition to any
other rights or remedies

5
<PAGE> 6

which the Company may have at law, in equity or under this Agreement, upon
adequate proof of Gonzalez's violation of any provision of Paragraph 5 or 6 of
this Agreement, the Company shall be entitled to immediate injunctive relief and
may obtain a temporary order restraining any threatened or further breach,
without the necessity of proof of actual damage.

9. CONTINUED AVAILABILITY AND COOPERATION. (a) Gonzalez shall cooperate
fully with the Company and with the Company's counsel in connection with any
present and future actual or threatened litigation or administrative proceeding
involving the Company that relates to events, occurrences or conduct occurring
(or claimed to have occurred) during the period of Gonzalez's employment by the
Company. This cooperation by Gonzalez shall include, but not be limited to:

(i) making himself reasonably available for interviews and discussions
with the Company's counsel as well as for depositions and trial testimony;

(iii) refraining from impeding in any way the Company's prosecution or
defense of such litigation or administrative proceeding; and

(iv) cooperating fully in the development and presentation of the
Company's prosecution or defense of such litigation or administrative
proceeding.

(b) From and after the date of this Agreement through August 31, 1996,
Gonzalez shall continue to provide cooperation to the Company with respect to
projects undertaken by the Company where Gonzalez's prior knowledge with respect
to, or prior involvement in, such or similar projects would be relevant to the
advancement of such projects; provided that such cooperation shall not require
more than forty-five (45) days of Gonzalez's time per calendar year.

(c) Gonzalez shall be reimbursed by the Company for reasonable travel,
lodging, telephone and similar expenses incurred in connection with such
cooperation, which the Company shall reasonably endeavor to schedule at times
not conflicting with the reasonable requirements of any future employer of
Gonzalez, or with the requirements of any third party with whom Gonzalez has a
business relationship that provides remuneration to Gonzalez. Gonzalez shall not
unreasonably withhold his availability for such cooperation.

(b) This Agreement shall inure to the benefit of and be enforceable by
Gonzalez's personal or legal representatives, executors, administrators,
successors, heirs, distributees and/or legatees.

6
<PAGE> 7

shall not be disclosed to any person not a party hereto (other than (i)
Gonzalez's spouse, (ii) each party's attorney, financial advisor and/or tax
advisor to the extent necessary for such advisor to render appropriate legal,
financial and tax advice, and (iii) persons or entities that fall within the
scope of Paragraph 7 of this Agreement, but only to the extent required
thereby), except as necessary to carry out the provisions of this Agreement, and
except as may be required by law; provided, however, that Gonzalez may disclose
to prospective employers the circumstances of his departure from the Company so
long as all such disclosures are made in a manner not injurious to the
reputation or business of the Company, and any such disclosure which is accurate
and made in a professional manner will be appropriate under this Paragraph.

(b) Because the purpose of this Agreement is to settle amicably any and all
potential disputes or claims among the parties, neither Gonzalez nor the Company
shall, directly or indirectly, make or cause to be made any statements to any
third parties criticizing or disparaging the other or commenting on the
character or business reputation of the other. Gonzalez further hereby agrees
not (1) to comment to others concerning the status, plans or prospects of the
business of the Company, or (2) to engage in any act or omission that would be
detrimental, financially or otherwise, to the Company, or that would subject the
Company to public disrespect, scandal or ridicule.

12. NOTICES. For all purposes of this Agreement, all communications
provided for herein shall be in writing and shall be deemed to have been duly
given when delivered, addressed to the Company (to the attention of the Vice
President of Human Resources) at its principal executive offices and to Gonzalez
at his principal residence, 441 Medway Road, Highland Heights, OH 44143, or to
such other address as any party may have furnished to the other in writing and
in accordance herewith. Notices of change of address shall be effective only
upon receipt.

13. MISCELLANEOUS. The death or disability of Gonzalez following the
execution of this Agreement shall not affect or revoke this Agreement or any of
the obligations of the parties hereto. No provision of this Agreement may be
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in writing signed by Gonzalez and the Company. No waiver by either
party hereto at any time of any breach by the other party hereto or compliance
with any condition or provision of this Agreement to be performed by such other
party shall be deemed a waiver of similar or dissimilar provisions or conditions
at the same or at any prior or subsequent time. No agreements or
representations, oral or otherwise, expressed or implied with respect to the
subject matter hereof have been made by any of the parties that are not set
forth expressly in this Agreement and every one of them (if, in fact, there have
been any) is hereby terminated without liability or any other legal effect
whatsoever.

14. ENTIRE AGREEMENT. This Agreement shall constitute the entire agreement
among the parties hereto with respect to the subject matter hereof and shall
supersede all prior verbal or written agreements, covenants, communications,
understandings, commitments, representations or warranties, whether oral or
written, by any party hereto or any of its representatives pertaining to such
subject matter.

17. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same Agreement.

18. CAPTIONS AND PARAGRAPH HEADINGS. Captions and paragraph headings used
herein are for convenience and are not part of this Agreement and shall not be
used in construing it.

7
<PAGE> 8

IN WITNESS WHEREOF, the parties have executed and delivered this Agreement
on the last date set forth below.

THE LINCOLN ELECTRIC COMPANY

By: _________________________
Donald F. Hastings
Chairman of the Board and
Chief Executive Officer

Date: ___________________

Witness: ________________________ _________________________
JOHN GONZALEZ

Date: ___________________

8
<PAGE> 9

EXHIBIT A

United States
Canada
Mexico
Brazil
Venezuela
England
France
Germany
Ireland
Italy
Japan
Netherlands
Norway
Spain
Australia

1
<PAGE> 10

EXHIBIT B

III. Arc Welding Power Sources and Automated Wire Feeding Systems.

<PAGE> 1

EXHIBIT (11)

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES

COMPUTATION OF EARNINGS PER SHARE

(IN THOUSANDS EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31
---------------------------------
1994 1993 1992
------- -------- --------
<S> <C> <C> <C>
Primary and fully diluted:
Average shares outstanding................................ 10,970 10,852 10,796
======= ======== ========
Income (loss) before cumulative effect of accounting
change................................................. $48,008 $(40,536) $(45,800)
Cumulative effect to January 1, 1993 in method of
accounting for income taxes............................ 2,468
------- -------- --------
Net income (loss)......................................... $48,008 $(38,068) $(45,800)
======= ======== ========
Per share amounts:
Income (loss) before cumulative effect of accounting
change................................................. $ 4.38 $ (3.74) $ (4.24)
Cumulative effect to January 1, 1993 in method of
accounting for income taxes............................ .23
------- -------- --------
Net income (loss)......................................... $ 4.38 $ (3.51) $ (4.24)
======= ======== ========
</TABLE>

<PAGE> 1

EXHIBIT (22)

THE LINCOLN ELECTRIC COMPANY AND SUBSIDIARIES
SUBSIDIARIES OF THE REGISTRANT

The Company's significant subsidiaries, all of which are included in its
consolidated financial statements, are listed in the following table:

<TABLE>
<CAPTION>
CONSOLIDATED
COUNTRY OF PERCENT
NAME INCORPORATION OWNERSHIP
-------------------------------------------------------------------------- ------------
<S> <C> <C>
Lincoln Norweld B.V. The Netherlands 100
Lincoln Electric (U.K.) Limited United Kingdom 100
Lincoln-Norweld A/S Norway 100
Lincoln Electric France S.A. France 100
Lincoln Smitweld B.V. The Netherlands 100
Lincoln K.D. S.A. Spain 100
Lincoln Electric Company
(Australia) Proprietary Limited Australia 100
Lincoln Electric Company of
Canada Limited Canada 96
Lincoln Big Three, Inc. United States 51
Big Three Lincoln Alaska, Inc. United States 100
Lincoln Electric Do Brasil Ltda. Brazil 100
</TABLE>

The Company has omitted the names of its subsidiaries which, considered in
the aggregate as a single subsidiary, would not constitute a "significant
subsidiary" within the meaning of Rule 1-02 contained in Regulation S-X.

<PAGE> 1

EXHIBIT 23

CONSENT OF INDEPENDENT AUDITORS

We consent to the incorporation by reference in the Registration Statement (Form
S-8 No. 33-25209) pertaining to The Lincoln Electric Company 1988 Incentive
Equity Plan of our report dated March 3, 1995, with respect to the consolidated
financial statements and schedule of The Lincoln Electric Company and
subsidiaries included in the Annual Report (Form 10-K) for the year ended
December 31, 1994.

ERNST & YOUNG LLP

Cleveland, Ohio
March 30, 1995
<PAGE> 2

EXHIBIT 23

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in the Registration
Statement Form S-8 (No. 33-25209) of The Lincoln Electric Company of our report
dated March 27, 1995 relating to the consolidated financial statements of The
Lincoln Electric Company (Australia) Proprietary Limited and subsidiaries
appearing on page 18 of this Form 10-K.

/s/ Price Waterhouse
-----------------------------------
Price Waterhouse

Parramatta, Australia
March 27, 1995
<PAGE> 3

EXHIBIT 23

KPMG KLYNVELD PEAT MARWICK GOERDELER

Ernst & Young
Attn: Mr. J. Katzenmeyer
1300 Huntington Building
Cleveland, Ohio 44115
USA

CONSENT OF INDEPENDENT ACCOUNTANTS

We consent to the incorporation by reference in Forms S-8 of our independent
auditors' report dated March 12, 1993 on the consolidated financial statements
and schedules of Messer Lincoln GmbH and its subsidiary as at December 31, 1992
referred to in the annual report on Form 10-K of The Lincoln Electric Company
for the year ended December 31, 1994.

Dusseldorf, March 21, 1995

KPMG KLYNVELD PEAT MARWICK GOERDELER
Gesellschaft mit beschrankter Haftung
Wirtschaftsprufungsgesellschaft

/s/ R. Kassing /s/ T. te Dorsthorst
---------------------------- ------------------------------
R. Kassing T. te Dorsthorst

<PAGE> 4

EXHIBIT 23

KPMG ACCOUNTANTS

CONSENT OF INDEPENDENT ACCOUNTANTS

We consent to the incorporation by reference in Forms S-8 of our report on the
consolidated financial statements and schedules of Lincoln-Norweld B.V. and its
subsidiaries referred to in the annual report on Form 10-K of The Lincoln
Electric Company for the year ended December 31, 1994.

Arnhem, The Netherlands

March 28, 1995

/s/ KPMG Accounts N.V.
-------------------------------
KPMG Accountants N.V.

<ARTICLE> 5
<MULTIPLIER> 1,000

<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-START> JAN-01-1994
<PERIOD-END> DEC-31-1994
<CASH> 10,424
<SECURITIES> 0
<RECEIVABLES> 130,258
<ALLOWANCES> 4,251
<INVENTORY> 155,276
<CURRENT-ASSETS> 313,427
<PP&E> 444,515
<DEPRECIATION> 260,304
<TOTAL-ASSETS> 556,857
<CURRENT-LIABILITIES> 144,117
<BONDS> 194,831
<COMMON> 2,203
0
0
<OTHER-SE> 191,930
<TOTAL-LIABILITY-AND-EQUITY> 556,857
<SALES> 906,604
<TOTAL-REVENUES> 911,113
<CGS> 556,259
<TOTAL-COSTS> 556,259
<OTHER-EXPENSES> 258,946
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 15,740
<INCOME-PRETAX> 80,168
<INCOME-TAX> 32,160
<INCOME-CONTINUING> 48,008
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 48,008
<EPS-PRIMARY> 4.38
<EPS-DILUTED> 4.38

</TABLE>