<PAGE> 1
SECURITIES EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
Annual Report Pursuant to Section 15(d) of the Securities Exchange Act of 1934
(Mark One)
X Annual Report Pursuant to Section 15(d) of the Securities Exchange Act of
--- 1934 (Fee Required)
For the fiscal year ended December 31, 1996
OR
Transition Report Pursuant to Section 15(d) of the Securities Exchange Act
--- of 1934 (Fee Required)
For the transition period from ______________________ to _______________________
Commission file number 0-1402
---------------------------------------------------------
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
The Lincoln Electric Company
Employee Savings Plan
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
The Lincoln Electric Company
22801 St. Clair Avenue
Cleveland, Ohio 44117
<PAGE> 2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees (or other persons who administer the employee benefit plan) have
duly caused this annual report to be signed on its behalf by the undersigned
hereunto duly authorized.
The Lincoln Electric Company
Employee Savings Plan
By: /S/ H. JAY ELLIOTT
-------------------------------
H. Jay Elliott
Senior Vice President,
Chief Financial Officer
and Treasurer
June 30, 1997
<PAGE> 3
Annual Report
THE LINCOLN ELECTRIC COMPANY
EMPLOYEE SAVINGS PLAN
PLAN SPONSOR AND ADMINISTRATOR
The Lincoln Electric Company
Cleveland, Ohio 44117
(216) 481-8100
Employer Identification Number: 34-0359955
December 31, 1996 and 1995
<PAGE> 4
Report of Independent Auditors
Plan Administrator
The Lincoln Electric Company
Employee Savings Plan
We have audited the accompanying statements of net assets available for benefits
with fund information (modified cash basis) of The Lincoln Electric Company
Employee Savings Plan as of December 31, 1996 and 1995, and the related
statements of changes in net assets available for benefits with fund information
(modified cash basis) for the years then ended. These financial statements are
the responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
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 provide a reasonable basis for our opinion.
As described in Note A, the financial statements and supplemental schedules were
prepared on a modified cash basis of accounting, which is a comprehensive basis
of accounting other than generally accepted accounting principles.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits (modified cash
basis) of the Plan at December 31, 1996 and 1995, and the changes in its net
assets available for benefits (modified cash basis) for the years then ended, on
the basis of accounting described in Note A.
Our audits were performed for the purpose of forming an opinion on the financial
statements taken as a whole. The accompanying supplemental schedules (modified
cash basis) of assets held for investment purposes as of December 31, 1996, and
reportable transactions for the year then ended, are presented for purposes of
complying with the Department of Labor's Rules and Regulations for Reporting and
Disclosure under the Employee Retirement Income Security Act of 1974, and are
not a required part of the financial statements. The fund information in the
statements of net assets available for benefits (modified cash basis) and the
statements of changes in net assets available for benefits (modified cash basis)
is presented for purposes of additional analysis rather than to present the net
assets available for benefits and changes in net assets available for benefits
of each fund. The supplemental schedules and fund information (modified cash
basis) have been subjected to the auditing procedures applied in our audits of
the financial statements and, in our opinion, are fairly stated in all material
respects in relation to the financial statements taken as a whole.
June 6, 1997 Ernst & Young LLP
Cleveland, Ohio
1
<PAGE> 5
The Lincoln Electric Company
Employee Savings Plan
Statement of Net Assets Available
for Benefits With Fund Information
December 31, 1996
<TABLE>
<CAPTION>
Fidelity
Victory U.S. Fidelity Advisors
Government The Bond Advisors Equity Victory Templeton
Obligations Fund of Income & Portfolio Stock Index Foreign
Fund America Growth Fund Growth Fund Fund Fund
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS
Investments:
Mutual funds $3,407,792 $ 327,615 $ 2,952,128 $ 6,739,793 $2,810,037 $4,892,733
Money market fund
The Lincoln Electric Company
Common Shares
The Lincoln Electric Company
Class A Common Shares
Participant loans receivable
--------------------------------------------------------------------------------------
Total investments 3,407,792 327,615 2,952,128 6,739,793 2,810,037 4,892,733
Investment income receivable 86 2,407 74 13,646 70 120
Other receivables--net 956
--------------------------------------------------------------------------------------
Total assets 3,407,878 330,022 2,952,202 6,753,439 2,811,063 4,892,853
LIABILITIES
Accrued purchase of investments 2,399 956
Other payables--net 13,474
--------------------------------------------------------------------------------------
NET ASSETS AVAILABLE FOR BENEFITS $3,407,878 $ 327,623 $ 2,952,202 $ 6,739,965 $2,810,107 $4,892,853
======================================================================================
<CAPTION>
The
The Lincoln
Lincoln Electric
Electric Non-Voting
Voting Stock Stock Loan
Fund Fund Fund Total
-------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS
Investments:
Mutual funds $21,130,098
Money market fund $ 2,480 $ 46,314 48,794
The Lincoln Electric Company
Common Shares 373,855 373,855
The Lincoln Electric Company
Class A Common Shares 325,551 325,551
Participant loans receivable $284,753 284,753
-------------------------------------------------------
Total investments 376,335 371,865 284,753 22,163,051
Investment income receivable 1,402 1,203 19,008
Other receivables--net 3,122 3,186 7,264
-------------------------------------------------------
Total assets 380,859 376,254 284,753 22,189,323
LIABILITIES
Accrued purchase of investments 5,051 48,238 56,644
Other payables--net 13,474
-------------------------------------------------------
NET ASSETS AVAILABLE FOR BENEFITS $375,808 $328,016 $284,753 $22,119,205
=======================================================
</TABLE>
See notes to financial statements.
2
<PAGE> 6
The Lincoln Electric Company
Employee Savings Plan
Statement of Net Assets Available
for Benefits With Fund Information
December 31, 1995
<TABLE>
<CAPTION>
Fidelity
Victory U.S. Fidelity Advisors
Government The Bond Advisors Equity Victory Templeton
Obligations Fund of Income & Portfolio Stock Index Foreign
Fund America Growth Fund Growth Fund Fund Fund
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments:
Mutual funds $2,316,043 $ 136,774 $ 1,920,942 $ 3,745,918 $1,380,276 $2,761,917
Money market fund 73 1,858
The Lincoln Electric Company
Common Shares
The Lincoln Electric Company
Class A Common Shares
Participant loans receivable
--------------------------------------------------------------------------------------
Total investments 2,316,043 136,847 1,920,942 3,745,918 1,382,134 2,761,917
Investment income receivable 790 70 27,286 5,662 14
--------------------------------------------------------------------------------------
Total assets 2,316,833 136,917 1,948,228 3,751,580 1,382,134 2,761,931
LIABILITIES
Accrued purchase of investments 1,012 27,280 5,648
Other payables--net 1,855
--------------------------------------------------------------------------------------
NET ASSETS AVAILABLE FOR BENEFITS $2,316,833 $ 135,905 $ 1,920,948 $ 3,745,932 $1,380,279 $2,761,931
======================================================================================
<CAPTION>
The
The Lincoln
Lincoln Electric
Electric Non-Voting
Voting Stock Stock Loan
Fund Fund Fund Total
------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS
Investments:
Mutual funds $12,261,870
Money market fund $ 2,887 $ 9,203 14,021
The Lincoln Electric Company
Common Shares 74,100 74,100
The Lincoln Electric Company
Class A Common Shares 38,496 38,496
Participant loans receivable $65,927 65,927
------------------------------------------------------
Total investments 76,987 47,699 65,927 12,454,414
Investment income receivable 389 1,532 35,743
------------------------------------------------------
Total assets 77,376 49,231 65,927 12,490,157
LIABILITIES
Accrued purchase of investments 33,940
Other payables--net 1,855
------------------------------------------------------
NET ASSETS AVAILABLE FOR BENEFITS $ 77,376 $49,231 $65,927 $12,454,362
======================================================
</TABLE>
See notes to financial statements.
3
<PAGE> 7
The Lincoln Electric Company
Employee Savings Plan
Statement of Changes in Net Assets Available
for Benefits With Fund Information
Year Ended December 31, 1996
<TABLE>
<CAPTION>
Fidelity
Victory Fidelity Advisors
U.S. Advisors Equity
Government The Bond Income & Portfolio Victory Templeton
Key EB Obligations Fund of Growth Growth Stock Index Foreign
MaGIC Fund Fund America Fund Fund Fund Fund
-------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
ADDITIONS
Contributions-employees $1,400,288 $ 126,909 $1,107,187 $2,365,832 $ 940,189 $1,571,798
Investment income $ 372 101 16,694 71,461 26,393 39,822 105,393
Net appreciation (depreciation)
in fair value of
investments 125,318 (491) 124,581 690,278 335,998 495,167
-------------------------------------------------------------------------------------------
Total additions 372 1,525,707 143,112 1,303,229 3,082,503 1,316,009 2,172,358
DEDUCTIONS
Benefits paid to participants 37,478 10,111 29,228 76,134 20,525 41,092
Administrative expenses
Other cash distributions 372
-------------------------------------------------------------------------------------------
Total deductions 372 37,478 10,111 29,228 76,134 20,525 41,092
Interfund transfers--net (397,184) 58,717 (242,747) (12,336) 134,344 (344)
-------------------------------------------------------------------------------------------
Net additions 1,091,045 191,718 1,031,254 2,994,033 1,429,828 2,130,922
Net assets available for
benefits at beginning of
the year 2,316,833 135,905 1,920,948 3,745,932 1,380,279 2,761,931
-------------------------------------------------------------------------------------------
NET ASSETS AVAILABLE FOR
BENEFITS
AT END OF THE YEAR $ 0 $3,407,878 $ 327,623 $2,952,202 $6,739,965 $2,810,107 $4,892,853
===========================================================================================
<CAPTION>
The
The Lincoln
Lincoln Electric
Electric Non-Voting
Voting Stock Stock Loan
Fund Fund Fund Total
-----------------------------------------------------
<S> <C> <C> <C> <C>
ADDITIONS
Contributions-employees $133,980 $ 71,416 $ 7,717,599
Investment income 4,256 2,959 $ 16,673 284,124
Net appreciation (depreciation)
in fair value of
investments 76,268 32,890 1,880,009
-----------------------------------------------------
Total additions 214,504 107,265 16,673 9,881,732
DEDUCTIONS
Benefits paid to participants 185 214,753
Administrative expenses 484 350 834
Other cash distributions 930 1,302
-----------------------------------------------------
Total deductions 669 350 930 216,889
Interfund transfers--net 84,597 171,870 203,083
-----------------------------------------------------
Net additions 298,432 278,785 218,826 9,664,843
Net assets available for
benefits at beginning of
the year 77,376 49,231 65,927 12,454,362
-----------------------------------------------------
NET ASSETS AVAILABLE FOR
BENEFITS
AT END OF THE YEAR $375,808 $328,016 $284,753 $ 22,119,205
=====================================================
</TABLE>
See notes to financial statements.
4
<PAGE> 8
The Lincoln Electric Company
Employee Savings Plan
Statement of Changes in Net Assets Available
for Benefits With Fund Information
Year Ended December 31, 1995
<TABLE>
<CAPTION>
Fidelity
Victory Fidelity Advisors
U.S. Advisors Equity
Government The Bond Income & Portfolio Victory Templeton
Key EB Obligations Fund of Growth Growth Stock Index Foreign
MaGIC Fund Fund America Fund Fund Fund Fund
--------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
ADDITIONS
Contributions-employees $ 460,511 $ 1,013,894 $ 57,897 $1,154,670 $1,912,361 $ 708,543 $1,583,408
Investment income 26,705 70 53,207 5,419 18,052 56,055
Net appreciation (depreciation)
in fair value of
investments 54,972 8,270 849 87,909 528,408 165,655 133,317
--------------------------------------------------------------------------------------------
Total additions 515,483 1,048,869 58,816 1,295,786 2,446,188 892,250 1,772,780
DEDUCTIONS
Benefits paid to participants 6,286 9,119 10,517 13,764 2,018 16,643
Administrative expenses 2,408
--------------------------------------------------------------------------------------------
Total deductions 8,694 9,119 10,517 13,764 2,018 16,643
Interfund transfers--net (1,170,007) 858,250 77,089 (50,963) 281,766 132,693 (269,321)
--------------------------------------------------------------------------------------------
Net additions (deductions) (663,218) 1,898,000 135,905 1,234,306 2,714,190 1,022,925 1,486,816
Net assets available for
benefits at beginning of
the year 663,218 418,833 686,642 1,031,742 357,354 1,275,115
--------------------------------------------------------------------------------------------
NET ASSETS AVAILABLE FOR
BENEFITS
AT END OF THE YEAR $ 0 $ 2,316,833 $135,905 $1,920,948 $3,745,932 $1,380,279 $2,761,931
============================================================================================
<CAPTION>
The
The Lincoln
Lincoln Electric
Electric Non-Voting
Voting Stock Stock Loan
Fund Fund Fund Total
----------------------------------------------------
<S> <C> <C> <C> <C>
ADDITIONS
Contributions-employees $ 31,908 $ 12,945 $ 6,936,137
Investment income 429 1,514 $ 2,803 164,254
Net appreciation (depreciation)
in fair value of
investments 4,039 (1,575) 981,844
----------------------------------------------------
Total additions 36,376 12,884 2,803 8,082,235
DEDUCTIONS
Benefits paid to participants 58,347
Administrative expenses 7 15 2,430
----------------------------------------------------
Total deductions 7 15 60,777
Interfund transfers--net 41,007 36,362 63,124
----------------------------------------------------
Net additions (deductions) 77,376 49,231 65,927 8,021,458
Net assets available for
benefits at beginning of
the year 4,432,904
----------------------------------------------------
NET ASSETS AVAILABLE FOR
BENEFITS
AT END OF THE YEAR $ 77,376 $ 49,231 $65,927 $ 12,454,362
====================================================
</TABLE>
See notes to financial statements.
5
<PAGE> 9
The Lincoln Electric Company Employee Savings Plan
Notes to Financial Statements
December 31, 1996
A. DESCRIPTION OF THE PLAN
The following description of The Lincoln Electric Company Employee Savings Plan
(the Plan) provides only general information. Participants should refer to the
Plan agreement for a more complete description of the Plan's provisions.
Additional information about the Plan is contained in the Plan Document, which
is available from the Company upon request.
GENERAL
The Plan is a defined contribution plan covering certain employees of The
Lincoln Electric Company (the Company) as defined by the Plan, as amended. The
Plan provides that employees will be eligible for participation in the Plan
following one year of service with the Company. The Plan is subject to the
provisions of the Employee Retirement Income Security Act of 1974.
The accounting records of the Plan are maintained on the modified cash basis of
accounting. Employee contributions are recorded when received by Key Trust
Company of Ohio, N.A. (the Trustee), whereas investment income and plan
liabilities are recorded when earned and incurred.
CONTRIBUTIONS
Eligible employees may make pre-tax contributions to the Plan of 1% or more of
their regular and/or bonus pay up to the maximum amount as set by the Internal
Revenue Service ($9,500 in 1996 and $9,240 in 1995). Employee contributions are
fully vested when made. A participant for whose account a contribution is made
shall have the right to direct the Trustee to invest such contribution in any
one fund or in a combination of funds in 5% increments.
The Company, at its discretion, may make a matching contribution, profit sharing
contribution or qualified nonelective contribution for any plan year to be made
in cash or Company stock. No Company contributions were made for 1996 or 1995.
On December 31, 1996 the Plan was amended effective as of January 1, 1997 to
provide for a matching contribution by the Company in the amount of 25% of the
first 6% of compensation contributed by the participant to the Plan. Matching
contributions will vest after an employee has attained three years of service,
will be invested in The Lincoln Electric Non-Voting Stock Fund, and will not
be subject to participant direction.
6
<PAGE> 10
The Lincoln Electric Company Employee Savings Plan
Notes to Financial Statements--Continued
A. DESCRIPTION OF THE PLAN--CONTINUED
PARTICIPANT ACCOUNTS
Each participant's account is credited with the participant's contributions and
allocations of (a) the Company's contributions if any, and (b) Plan earnings,
and is charged with an allocation of certain administrative expenses.
Allocations are based on participant earnings or accounts balances, as defined.
The benefit to which a participant is entitled is the benefit that can be
provided from the participant's account.
INVESTMENT OPTIONS
The investment options are as follows:
<TABLE>
<CAPTION>
Fund Description Sponsor
- --------------------------------------------------------------------------------------------------
<S> <C> <C>
Victory U.S. Government
Obligations Fund Money Market Victory Broker Dealer Services
The Bond Fund of America Bonds American Funds Group
Fidelity Advisors Income &
Growth Fund Growth Stocks Fidelity Investment Co.
Fidelity Advisors Equity Preferred and Common Fidelity Investment Co.
Portfolio Growth Fund Stocks
Victory Stock Index Fund S&P 500 Index Victory Broker Dealer Services
Templeton Foreign Fund International Fund Templeton Investment Co.
The Lincoln Electric The Lincoln Electric The Lincoln Electric
Voting Stock Fund Company Common Shares Company
The Lincoln Electric The Lincoln Electric The Lincoln Electric
Non-voting Stock Fund Company Class A Company
Common Shares
</TABLE>
The Plan also may periodically hold investments in the Key Employee Benefits
(EB) Money Market Fund while awaiting transfer to participant directed
investments.
Effective June 2, 1995, The Victory U.S. Treasury Money Market Fund was
consolidated into the Victory U.S. Government Obligations Fund. The two funds
are similar in their investment strategies. Effective December 1, 1995, The Bond
Fund of America was offered as a new investment option. Also effective December
1, 1995 the Company added two Company stock funds as investment options: The
Lincoln Electric Voting Stock Fund and The Lincoln Electric Non-Voting Stock
Fund.
7
<PAGE> 11
The Lincoln Electric Company Employee Savings Plan
Notes to Financial Statements--Continued
A. DESCRIPTION OF THE PLAN--CONTINUED
PAYMENT OF BENEFITS
Participants may receive the value of their account in a single sum payment or
in ten or fewer annual installment payments following separation from the
Company, whether by retirement, disability or otherwise except that if the full
value of a participant's account is $3,500 or less, or if the participant dies
and his/her account is payable to his/her beneficiary, such account balance will
be paid in a single sum payment. If the value of a participant's account is more
than $3,500 the participant may elect to defer the payment of his/her account
until they reach age 60. Participants who leave the Company may withdraw their
money at any time. Withdrawal must begin when the participants attain the age of
70 1/2. A participant or beneficiary may elect to receive that portion of their
distribution which is attributable to their interest in the Company Stock Funds
in the form of whole shares of Company stock with any fractional shares of
Company stock in cash.
PARTICIPANT LOANS RECEIVABLE
Active employees are eligible to borrow up to 50% of their vested account
balance with a minimum borrowing of $1,000 up to a maximum of $50,000. The loan
may be paid back over any number of months, up to five years. The interest rate
on participant loans is determined by the Trustee. The interest rate on
outstanding loans is computed as the prime rate in effect at the loan
origination date plus 1%. Rates on loans originated during the 1996 and 1995
plan years ranged from 9.25% to 10.0% and 9.5% to 10.0%, respectively.
PLAN TERMINATION
Although the Company has not expressed an intent to do so, it has the right to
amend, modify, suspend or terminate the Plan at any time. No amendment,
modification, suspension or termination of the Plan shall have the effect of
providing that any amounts then held under the Plan may be used or diverted to
any purpose other than for the exclusive benefit of the participants or their
beneficiaries.
8
<PAGE> 12
The Lincoln Electric Company Employee Savings Plan
Notes to Financial Statements--Continued
B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
INVESTMENT VALUATION AND INCOME RECOGNITION
The Plan's investments held at year end are stated at fair value based on quoted
market prices. The participant loans receivable are valued at cost which
approximates fair value.
Proceeds from sales of securities, less fair value at the beginning of the year
or cost for purchases during the year, and net unrealized appreciation
(depreciation) based on market price fluctuations during the year or since date
of acquisition, are included as net appreciation (depreciation) in fair value of
investments.
USE OF ESTIMATES
Preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions in
certain circumstances that affect amounts reported in the accompanying financial
statements and notes. Actual results could differ from these estimates.
ADMINISTRATIVE EXPENSES
During 1995, the Plan was amended effective as of November 1, 1994, to state
that all costs and expenses incurred in connection with the administration of
the Plan and Trust shall be paid from the trust fund; unless the Company elects
to pay all or part of such expenses. The Company elected to pay certain
administrative costs of the Plan in 1996 and 1995.
C. INVESTMENTS
The Trustee of the Plan holds the Plan's investment assets and executes
transactions.
The fair value of investments that represent 5% or more of the Plan's net assets
available for plan benefits at December 31, 1996 and 1995 are as follows:
<TABLE>
<CAPTION>
1996 1995
------------------------------------
<S> <C> <C>
Victory U.S. Government Obligations Fund $ 3,407,792 $ 2,316,043
Fidelity Advisors Income & Growth Fund 2,952,128 1,920,942
Fidelity Advisors Equity Portfolio Growth Fund 6,739,793 3,745,918
Victory Stock Index Fund 2,810,037 1,380,276
Templeton Foreign Fund 4,892,733 2,761,917
</TABLE>
9
<PAGE> 13
The Lincoln Electric Company Employee Savings Plan
Notes to Financial Statements--Continued
D. INCOME TAX STATUS
On March 22, 1996, the Internal Revenue Service issued a favorable determination
letter stating that the Plan qualifies under Section 401(a) of the Internal
Revenue Code (IRC) and, therefore, the related trust is not subject to tax under
present income tax law. Once qualified, the Plan is required to operate in
conformity with the IRC to maintain its qualification. The Company is not aware
of any course of action or series of events that have occurred that might
adversely affect the Plan's qualified status. The tax exempt status of the Plan
does not apply to the taxability of distributions to participants under the
Plan.
E. TRANSACTIONS WITH PARTIES-IN-INTEREST
Party-in-interest transactions included the investment in the special funds of
the Trustee and the payment of administrative expenses. Such transactions are
exempt from being prohibited transactions.
At December 31, 1996, the Plan held 11,372 Common Shares and 10,672 Class A
Common Shares of The Lincoln Electric Company stock with a fair value of
$373,855 and $325,551, respectively.
At December 31, 1995, the Plan held 2,964 Common Shares and 1,604 Class A Common
Shares of The Lincoln Electric Company stock with a fair value of $74,100 and
$38,496, respectively.
F. SUBSEQUENT EVENTS
Effective July 1, 1997, The Lincoln Electric Company Employee Stock Ownership
Plan ("ESOP"), with assets of approximately $29 million at May 31, 1997, will be
eliminated and the assets merged into the Trust of the Plan. Individuals not
participating in the Plan at the time of the merger, but who maintain assets in
the ESOP, will automatically be enrolled as participants and have account
balances established in the Plan.
Also effective July 1, 1997, the Plan will offer three additional investment
funds: The EB MaGIC fund, which invests in insurance company and other
investment contracts with maturities of five years or less; The Income Fund of
America, which invests in a balanced portfolio of equity and fixed income
securities; and the Franklin Small Cap Growth Fund, which invests in equity
securities of companies with market capitalizations of less than $1 billion.
10
<PAGE> 14
The Lincoln Electric Company Employee Savings Plan
Form 5500, Item 27(a)--Schedule of Assets Held for Investment Purposes
December 31, 1996
<TABLE>
<CAPTION>
Description of Historical Current
Identity of Issue Investment Cost Value
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Victory U.S. Government
Obligations Fund 323,442.666 units $ 3,287,038 $ 3,407,792
The Bond Fund of America 23,826.539 units 326,241 327,615
Fidelity Advisors Income & Growth Fund 180,227.562 units 2,770,239 2,952,128
Fidelity Advisors Equity Portfolio
Growth Fund 160,433.056 units 5,937,112 6,739,793
Victory Stock Index Fund 184,627.934 units 2,415,775 2,810,037
Templeton Foreign Fund 472,271.524 units 4,451,494 4,892,733
Key Trust Company of Ohio
N.A.--Employee Benefits
Money Market Fund* 48,793.790 units 48,794 48,794
The Lincoln Electric Company* 11,372 Common Shares 326,865 373,855
The Lincoln Electric Company* 10,672 Class A
Common Shares 302,185 325,551
Participant loans 9.25% to 10.0%;
variable maturities 284,753 284,753
---------------------------------------
$ 20,150,496 $ 22,163,051
=======================================
<FN>
* Indicates party-in-interest to the Plan
</TABLE>
11
<PAGE> 15
The Lincoln Electric Company Employee Savings Plan
Form 5500, Item 27(d)--Schedule of Reportable Transactions
Year Ended December 31, 1996
<TABLE>
<CAPTION>
Current
Value
of Asset on Net
Purchase Selling Cost of Transaction Gain
Description of Asset Price Price Asset Date (Loss)
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CATEGORY (i)--INDIVIDUAL TRANSACTIONS IN EXCESS OF 5% OF PLAN ASSETS
Key Trust Company of Ohio
N.A.--Employee Benefits Money
Market Fund* $ 3,170,194 $ 3,170,194 $ 3,170,194
$ 3,000,670 3,000,670 3,000,670
Fidelity Advisors Equity Portfolio
Growth Fund 978,969 978,969 978,969
Templeton Foreign Fund 687,265 687,265 687,265
CATEGORY (iii)--SERIES OF TRANSACTIONS IN EXCESS OF 5% OF PLAN ASSETS
Key Trust Company of Ohio
N.A.--Employee Benefits Money
Market Fund* 4,497,845 4,497,845 4,497,845
4,463,053 4,463,053 4,463,053
Fidelity Advisors Income &
Growth Fund 1,222,587 1,222,587 1,222,587
Victory Stock Index Fund 1,334,223 1,334,223 1,334,223
Fidelity Advisors Equity Portfolio
Growth Fund 2,664,648 2,664,648 2,664,648
Templeton Foreign Fund 1,947,411 1,947,411 1,947,411
Victory U.S. Government
Obligations Fund 1,622,295 1,622,295 1,622,295
655,863 643,212 655,863 $ 12,651
There were no category (ii) or (iv) reportable transactions during the year
ended December 31, 1996.
<FN>
* Indicates party-in-interest to the Plan.
</TABLE>
12
<PAGE> 16
Item 7. Exhibit Index
Exhibit 23- Consent of Independent Auditors
<PAGE> 1
Exhibit 23
Consent of Independent Auditors
We consent to the incorporation by reference in the Registration Statement (Form
S-8 No. 33-64187) pertaining to The Lincoln Electric Company Employee Savings
Plans of our report dated June 6, 1997, with respect to the financial statements
and schedules of The Lincoln Electric Company Employee Savings Plan included in
this Annual Report (Form 11-K) for the year ended December 31, 1996.
Ernst & Young LLP
Cleveland, Ohio
June 26, 1997
