<PAGE 2>
THIS DOCUMENT IS A CONFIRMING ELECTRONIC COPY
OF A SCHEDULE 13D FILED ON DECEMBER 20, 1993
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. )*
FIGGIE INTERNATIONAL INC.
(Name of Issuer)
Class B Common Stock, par value $.10 per share
(Title of Class of Securities)
316828 60 7
(CUSIP Number)
Harry E. Figgie, Jr.
4420 Sherwin Road
Willoughby, OH 44094 216/953-2700
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
December 9, 1993
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the
following box .
Check the following box if a fee is being paid with the statement X .
(A fee is not required only if the reporting person: (1) has a previous
statement on file reporting beneficial ownership of more than five percent
of the class of securities described in Item 1; and (2) has filed no
amendment subsequent thereto reporting beneficial ownership of five percent
or less of such class.) (See Rule 13d-7.)
(continued on following pages)
(Page 1 of 40 Pages)
Note: Six copies of this statement, including all exhibits, should be
filed with the Commission. See Rule 13d-1(a) for other parties to whom
copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of
that section of the Act but shall be subject to all other provisions of the
Act (however, see the Notes).
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<TABLE>
<CAPTION>
SCHEDULE 13D
CUSIP No. 316828 60 7 Page 2 of 40 Pages
<S> <C>
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Harry E. Figgie, Jr.
###-##-####
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)
(b) X
3 SEC USE ONLY
4 SOURCE OF FUNDS
00
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Mr. Figgie is a citizen of the United States
NUMBER OF 7 SOLE VOTING POWER
SHARES 849,374 Shares at December 9, 1993
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 135,410 Shares at December 9, 1993
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 849,374 Shares at December 9, 1993
PERSON 10 SHARED DISPOSITIVE POWER
134,564 Shares at December 9, 1993
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
984,784 Shares at December 9, 1993
12 CHECK BOX IF THE AGGREGATE AMOUNT INX X
ROW (11) EXCLUDES CERTAIN SHARES*
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW(11)
19.64%
14 TYPE OF REPORTING PERSON*
IN
</TABLE>
*SEE INSTRUCTIONS BEFORE FILLING OUT!
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Page 3 of 40
Item 1. Security and Issuer.
This statement on Schedule 13D (the "Schedule 13D")
relates to Class B common stock, par value $.10 per share (the
"Class B Stock"), of Figgie International Inc. (the
"Corporation"). The Corporation's principal executive officers
are located at 4420 Sherwin Road, Willoughby, Ohio 44094.
Item 2. Identity and Background.
(a) - (c) The Schedule 13D is being filed by Harry E.
Figgie, Jr. Mr. Figgie's address is 4420 Sherwin Road,
Willoughby, Ohio 44094. Mr. Figgie's present principal
employment is as Chairman of the Board and Chief Executive
Officer of the Corporation, whose address is stated in Item 1
above. The Corporation is a diversified operating company whose
businesses are grouped into five segments: (i) consumer
products, (ii) fire protection, safety, and security products,
(iii) machinery and allied products, (iv) technical products and
(v) services.
(d) Mr. Figgie has not been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors)
during the last five years.
(e) Mr. Figgie has not been a party to a civil
proceeding of a judicial or administrative body of competent
jurisdiction which resulted in a judgment, decree or final order
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Page 4 of 40
enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or
finding any violation with respect to such laws.
(f) Mr. Figgie is a citizen of the United States of
America.
Item 3. Source and Amount of Funds or Other Consideration.
On December 9, 1993, Mr. Figgie acquired 70,000 shares
of Class B Stock in exchange for 76,604 shares of Class A common
stock, par value $0.10 per share (the "Class A Stock"), of the
Corporation; no other consideration was used in this transaction.
The 76,604 shares of Class A Stock had been acquired as a stock
dividend paid in 1986 on shares of Class B Stock then held by Mr.
Figgie.
Item 4. Purpose of Transaction.
The purpose of the transaction was for Mr. Figgie to
increase his voting power by increasing his holdings of Class B
Stock. Class B Stock has one vote per share, while Class A Stock
has 1/20th of a vote per share. For several years prior to the
Corporation's 1992 annual meeting of stockholders (the "1992
Meeting"), Mr. Figgie had not acquired additional shares of Class
B Stock because of certain voting restrictions contained in the
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Page 5 of 40
"Substantial Stockholder" provision of the Corporation's Restated
Certificate of Incorporation. This provision placed certain
voting restrictions on a person who, due to his beneficial
ownership of shares in excess of the applicable threshold
percentage (generally 10% prior to the 1992 Meeting) was deemed
to be a "Substantial Stockholder." For each share in excess of
the applicable threshold percentage, a Substantial Stockholder is
entitled to 1/100th of the vote to which such share is otherwise
entitled. At the 1992 Meeting, the Corporation's stockholders
voted to change the definition of a Substantial Stockholder by
raising the generally applicable threshold percentage from 10% to
20%. As a result, Mr. Figgie could acquire additional shares of
Class B Stock without becoming a Substantial Stockholder.
Since then, Mr. Figgie acquired 100,000 shares of Class
B Stock from the Corporation in August 1992, and 100,000 shares
of Class B Stock under the Corporation's 1993 Restricted Stock
Plan for Employees in August 1993.
Mr. Figgie has no plans or proposals which relate to or
would result in the occurrence of any of the events listed in
paragraphs (a) through (j) of this Item 4, except as follows:
Mr. Figgie is a participant in the Figgie International
Inc. Stock Ownership Trust and Plan (the "ESOP"), the Figgie
International Inc. Stock Ownership Trust and Plan for Salaried
Employees (the "ESOP for Salaried Employees"), and the Figgie
International Inc. Stock Bonus Trust and Plan (the "Stock Bonus
Plan") (collectively, the "Plans"). As a participant in the
<PAGE 7>
Page 6 of 40
Plans, Mr. Figgie is eligible to receive shares of common stock
of the Corporation in accordance with the terms of the Plans.
Mr. Figgie presently intends to continuously review his
equity interest in the Corporation, and the Corporation's
business affairs and financial condition. Depending on his
evaluations of the Corporation's business and prospects, and upon
future developments (including, but not limited to, performance
of the Corporation, the availability of funds, future
opportunities, money and stock market conditions, general
economic conditions and his own personal financial
circumstances), Mr. Figgie may, and reserves the right to,
acquire additional shares of Class B or Class A Stock, or dispose
of shares of Class B or Class A Stock in one or more privately
negotiated transactions, on the open market, or otherwise. Any
sales by Mr. Figgie of all of his shares of Class B Stock could
cause a change in control of the Corporation, a change in the
composition of its Board of Directors or management or other
changes implemented by any new Board of Directors.
Item 5. Interest in Securities of the Issuer.
(a) Mr. Figgie beneficially owns an aggregate of
984,784 shares of Class B Stock, which constitutes approximately
19.64% of the outstanding shares of Class B Stock as of December
9, 1993. Pursuant to Section 13(d)(6)(B) of the Securities
Exchange Act of 1934, as amended, Mr. Figgie has previously not
<PAGE 8>
Page 7 of 40
been subject to an obligation to file a Schedule 13D with respect
to Class B Stock. Mr. Figgie has previously filed a Schedule 13G
and amendments with respect to Class B Stock.
Included in the number of shares as to which Mr. Figgie
has sole beneficial ownership are 421 shares of Class B Stock
allocated to him under the ESOP, 419 shares of Class B Stock
allocated to him under the ESOP for Salaried Employees, and
13,207 shares of Class B Stock allocated to him under the Stock
Bonus Plan.
Under the terms of the trust instruments governing the
Plans, participants are entitled to instruct the Trustee of the
plan, on a confidential basis, on how to vote shares allocated to
their accounts on any matter to be voted on by stockholders of
the Corporation and on whether to tender such shares in any
tender or exchange offer. Allocated shares for which no
instructions are received cannot be voted or tendered by the
Trustee. With respect to unallocated shares held by the Plans,
the Trustee must follow the confidential instructions of active
participants as to how to vote the shares on certain "important
issues," defined as a merger or consolidation, recapitalization,
reclassification, liquidation, dissolution, sale of substantially
all of the assets of the Corporation or contested elections of
directors, and as to whether to tender such unallocated shares in
any tender or exchange offer. Each active participant is
entitled to instruct the Trustee as to the voting or tendering of
a portion of the unallocated shares in the proportion that his
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Page 8 of 40
prior-year's compensation, subject to certain limitations, bears
to the prior-year's compensation of all active participants who
actually give voting or tendering instructions. Shares held by
the ESOP for Salaried Employees which were originally acquired
with surplus assets of the Corporation's Retirement Income Plan
(an overfunded defined benefit plan terminated on November 21,
1988), including shares purchased with loans repaid with such
assets, cannot be disposed of by the Trustee, except in certain
limited circumstances which are described below.
On matters other than the specified "important issues,"
the Trustee has sole power to vote all unallocated shares. The
trust instruments authorize the Trustee to dispose of shares held
by the plans pursuant to the directions of participants with
respect to the diversification of the investments of participant
accounts, or in the response to a tender or exchange offer, or as
needed for the purposes of making distributions of cash in lieu
of shares or distributions of shares of Class A Stock instead of
Class B Stock.
The number of shares of Class B Stock Mr. Figgie
beneficially owns includes 491 shares of the unallocated shares
of Class B Stock held by the ESOP and 355 shares of the
unallocated shares of Class B Stock held by the ESOP for Salaried
Employees. As Mr. Figgie is an active participant in the Plans,
included in the number of shares as to which Mr. Figgie has
shared beneficial ownership is his beneficial ownership in the
<PAGE 10>
Page 9 of 40
unallocated shares of the ESOP and the ESOP for Salaried
Employees.
The aggregate number of shares beneficially owned by
Mr. Figgie excludes a total of 301,971 shares of Class B Stock
beneficially owned, or that may be deemed to be beneficially
owned, by members of Mr. Figgie's immediate family, The Figgie
Family Foundation, and certain Figgie family trusts at December
9, 1993. Of the excluded shares, Mr. Figgie's wife owned 59,031
shares of Class B Stock; Matthew P. Figgie (Mr. Figgie's son, who
lives in the same home as Mr. Figgie) owned 2,058 shares of Class
B Stock (excluding those held in trust noted below); Dr. Harry E.
Figgie, III (Mr. Figgie's son) beneficially owned 59,090 shares
of Class B Stock (excluding those held in trust noted below); Dr.
Mark P. Figgie (Mr. Figgie's son) owned 58,189 shares of Class B
Stock (excluding those held in trust noted below); and The Figgie
Family Foundation, of which Mr. Figgie is one of six trustees,
owned 2,112 shares of Class B Stock. Also, of the excluded
shares, 69,000 shares of Class B Stock were held in trust for Mr.
Figgie's wife for which The Wilmington Trust Company acts as
trustee; 47,493 shares of Class B Stock were held in trust for
Matthew P. Figgie, for which Dr. Harry E. Figgie, III, F. Rush
McKnight, and David L. Carpenter act as trustees; 2,499 shares of
Class B Stock were held in trust for Dr. Harry E. Figgie, III,
for which First Kentucky Trust Co. acts as trustee; 2,499 shares
of Class B Stock were held in trust for Dr. Mark P. Figgie, for
which First Kentucky Trust Co. acts as trustee; and 2,499 shares
of Class B Stock were held in trust for Matthew P. Figgie, for
which First Kentucky Trust Co. acts as trustee.
<PAGE 11>
Page 10 of 40
(b) Mr. Figgie has sole voting and dispositive power
with respect to 849,374 shares of Class B Stock.
Mr. Figgie has shared voting and dispositive power with
respect to 134,564 shares of Class B Stock owned by The Clark-
Reliance Corporation, an Ohio corporation ("Clark-Reliance").
Clark-Reliance is wholly owned by Mr. Figgie and members of his
immediate family, and Mr. Figgie is Chairman of the Board of
Clark-Reliance. Mr. Figgie shares voting and dispositive power
with respect to these shares with his son, Dr. Harry E. Figgie,
III, who is a citizen of the United States. Dr. Figgie's address
is 4420 Sherwin Road, Willoughby, Ohio 44094, and his present
principal employment is as a Director and Vice Chairman of
Technology and Strategic Planning of the Corporation, whose
address is stated in Item 1 above. Dr. Figgie has not been
convicted in a criminal proceeding (excluding traffic violations
or similar misdemeanors) during the last five years. Dr. Figgie
has not been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction which resulted in a
judgment, decree or final order enjoining future violations of,
or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to
such laws.
<PAGE 12>
Page 11 of 40
Mr. Figgie has shared voting power with respect to the
846 unallocated shares of Class B Stock that are held by the ESOP
and the ESOP for Salaried Employees. As discussed above, Mr.
Figgie has voting power with respect to certain matters and the
Trustees of each of the ESOP and the ESOP for Salaried Employees
have voting power with respect to other matters presented to the
stockholders for approval.
Joseph J. Skadra and F. Rush McKnight serve as
individual trustees of the ESOP and the ESOP for Salaried
Employees. Mr. Skadra's present principal employment is as
Senior Vice President-Finance of the Corporation, whose address
is stated in Item 1 above. Mr. McKnight's present principal
employment is as a partner in the law firm of Calfee, Halter &
Griswold, and he also serves as a Director of the Corporation.
Mr. McKnight's business address is 800 Superior Avenue, Suite
1800, Cleveland, Ohio 44114. Mr. Skadra and Mr. McKnight are
citizens of the United States, and, to the knowledge of Mr.
Figgie, neither has been convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors) during the
last five years nor has either been a party to a civil proceeding
of a judicial or administrative body of competent jurisdiction
which resulted in a judgment, decree or final order enjoining
future violations of, or prohibiting or mandating activities
subject to, federal or state securities laws or finding any
violation with respect to such laws.
<PAGE 13>
Page 12 of 40
(c) A description of the transaction is contained in
Item 3 of this Schedule 13D. The transaction was effected
pursuant to Rule 144.
(d) Clark-Reliance possesses ownership interest in a
portion of the securities listed or described in subsections (a)
or (b) of this Item 5, and has certain rights to the receipt of,
or power to direct the receipt of, dividends from, or the
proceeds from the sale of the securities it owns.
The Plans have the rights to the receipt of dividends
from, and any proceeds of the sale of, shares owned by the Plans,
however, dividends on shares allocated to the accounts of
participants are allocated to such accounts.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or
Relationships With Respect to Securities of the Issuer.
A description of the voting arrangements of the Plans
is contained in Item 5 of this Schedule 13D.
Item 7. Material to be Filed as Exhibits.
Exhibit A: Copies of the voting provisions of the
Plans.
<PAGE 14>
Page 13 of 40
SIGNATURE
After reasonable inquiry and to the best of my
knowledge and belief, I certify that the information set forth in
this statement is true, complete and correct.
Dated: December 17, 1993
By: /s/ Harry E. Figgie, Jr.
Harry E. Figgie, Jr.
<PAGE 15>
Page 14 of 40
Exhibit Index
Exhibit No. Description
A Description of voting provisions of
Figgie International Inc. Stock
Ownership Trust and Plan, the
Figgie International Inc. Stock
Ownership Trust and Plan for
Salaried Employees, and the Figgie
International Inc. Stock Bonus
Trust and Plan.
<PAGE 16>
Exhibit A:
Voting Stock (Salaried ESOP)
or in equity any rights or remedies in respect of any lease or
mortgage or of any guarantee pertaining to either of them;
(c) To exercise, personally or by general or limited proxy,
the right to vote any shares of stock or other securities held in
the investment fund; to delegate discretionary voting power to
trustees of a voting trust for any period of time; and to exercise
or sell, personally or by power of attorney, any conversion or
subscription or other rights appurtenant to any securities or other
property held in the investment fund;
(d) To join in or oppose any reorganization, recapitalization,
consolidation, merger or liquidation, or any plan therefor, or any lease
(with or without an option to purchase), mortgage or sale of the
property of any organization the securities of which are held in the
investment fund; to pay from the investment fund any assessments,
charges or compensation specified in any plan of reorganization,
recapitalization, consolidation, merger or liquidation, to deposit any
property with any committee or depositary; and to retain any property
allotted to the investment fund in any reorganization, recapitalization,
consolidation, merger or liquidation;
(e) To continue to hold any property of the investment fund
whether or not productive of income; to reserve from investment and keep
unproductive of income, without liability for interest, such cash as it
deems advisable or, in its discretion, to hold the same, without
limitation on duration, on deposit in the commercial department or in an
interest-bearing account in the savings department of any bank, trust
company, or savings and loan institution (including the Trustee where
applicable in its capacity as a banking corporation) in which deposits
are guaranteed by the Federal Deposit Insurance Corporation or the
Federal Savings and Loan Insurance Corporation;
(f) To make, execute and deliver, as Trustee, any deeds,
conveyances, leases (with or without option to purchase), mortgages,
options that the Trustee shall deem necessary or desirable in the
exercise of its powers under the investment fund;
(g) To commingle the assets of the investment fund with assets of
other trusts through the medium of the Figgie International Inc.
Investment Trust for Retirement Trusts established by the Company by an
agreement dated and executed on December 31, 1968, investing and
reinvesting the assets of the investment fund in Units, of such
Investment Trust, created or hereafter created pursuant to said
agreement, and in such proportions as the Company may deem advisable
from time to time, acting in its sole discretion. To the extent of
13-6
<PAGE 17>
institution, which deposits may, but need not be, guaranteed by the
Federal Deposit Insurance Corporation or the Federal Savings and Loan
Insurance Corporation, or in shares of any Regulated Investment Company,
in units of any common trust fund or in partnership interests of any
partnership which Regulated Investment Company, common trust fund or
partnership invests in such short-term money market instruments and
deposits;
(c) Pending investment in Shares pursuant to Section 15.1 or
pursuant to Article XIII hereof, to invest a portion or all of the Trust
Fund, other than Shares, in units of any common or group trust created
solely for the purpose of providing a satisfactory diversification of
investments for participating trusts; provided that such common or group
trust, (i) limits participation thereunder to pension, profit sharing
and stock bonus trusts which qualify under Section 501(a) of the
Internal Revenue Code, (ii) prohibits income and/or principal
attributable to a participating trust from being used for any purpose
other than the exclusive benefit of the employees or their beneficiaries
of such participating trust, (iii) prohibits assignment by a
participating trust of any part of such participating trust's equity or
interest in the common or group trust, (iv) is created or organized in
the United States and is maintained at all times as a domestic trust in
the United States; as long as the Trustee holds such units hereunder,
the instrument establishing such common or group trust (including all
amendments thereto) shall be deemed to have been adopted and made a part
of this Trust and Plan;
(d) To exercise personally or by general or limited proxy,
the right to vote any Shares held in the Trust Fund; to delegate
discretionary voting power to trustees of a voting trust for any period
of time; and to exercise or sell, personally or by power of attorney,
any conversion or subscription or other rights appurtenant to any Shares
or other property held in the Trust Fund, provided that, in each
instance described in Section 15.4 or 15.5 hereof, such power and duty
shall be subject to the direction of participants, former participants,
beneficiaries and "alternate payees" (as defined in Section 17.1(a)
hereof) pursuant to such Section 15.4 or 15.5;
(e) To borrow money from any lender (including the Trustee
hereunder, where applicable in its capacity as a banking corporation
when permitted to do so by the applicable laws and regulations then in
effect) in any amount and upon such terms and conditions and for such
purposes as the Trustee shall deem necessary; for any money so borrowed
the Trustee may issue its promissory note as Trustee and to secure the
repayment of any such loan, except a "loan" as defined in Section 2.24
hereof, may pledge or mortgage all or any part of the Trust Fund to
secure the repayment of any such loan, with interest, and no person
loaning money to the Trustee shall be obligated to see to the
application of the money loaned or to inquire into the validity,
expediency or propriety of any such borrowing;
15-5
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shall equal the number of Shares of Class A Common Stock over which the
person has tender or exchange direction power multiplied by a fraction.
The numerator of the fraction is the actual number of Shares of Class A
Common Stock held by the Trustee in the Trust Fund at the appropriate
time. The denominator of the fraction is the number of Shares of Class
A Common Stock deemed held by the Trustee at the same time under the
Share accounting method generally described in Article VII hereof.
15.5 It is the purpose of this Section 15.5 to permit
participants, former participants, beneficiaries and "alternate payees"
(as defined in Section 17.1(a) hereof) to exercise substantial voting
rights under this Trust and Plan with respect to Shares allocated to
their accounts under this Trust and Plan because, except in the event of
forfeiture, they or their beneficiaries will eventually be entitled to
receive distribution thereof. Furthermore, active participants have the
expectancy that, if they continue in service with the Company,
unallocated Shares will be allocated to their accounts in the future and
eventually be distributed to them or their beneficiaries. It also may
be assumed that such allocation will be made on a basis roughly
comparable to relative current compensation. It therefore is the
further purpose of this Section 15.5 to permit active participants to
exercise such substantial voting rights with respect both to Shares
allocated to their accounts and with respect to unallocated Shares, but
in the latter case, only with respect to "Important Issues" as
hereinafter defined in this Section 15.5 which justify the
administrative expense involved with exercise of such voting
15-12
<PAGE 19>
direction. For purposes of this Section 15.5, "Important Issues" are
corporate matters involving the voting of such Shares with respect to
the approval or disapproval of any merger or consolidation,
recapitalization, reclassification, liquidation, dissolution or sale of
substantially all assets of the Company or with respect to any contested
elections of directors. While the foregoing list of Important Issues
closely parallels the list of issues indicated by Congress as important
in Section 409(e) (3) of the Internal Revenue Code, it is not intended
that, without formal amendment to the list of Important Issues contained
in this Trust and Plan, such list automatically change to reflect either
an amendment to Section 409(e) (3) of the Internal Revenue Code which
modifies the list of issues contained in said Section or the
promulgation of regulations thereunder. For the foregoing reasons, the
power to direct the Trustee regarding the exercise of the right to vote
the Shares in the Trust Fund allocated to their accounts with respect to
any matter on which such Shares may be voted is hereby granted to such
participants, former participants, beneficiaries and alternate payees
pursuant to this Section 15.5. Furthermore, for such reasons, the power
to direct the Trustee regarding the exercise of the right to vote the
Shares in the Trust Fund which are not allocated to any account with
respect to Important Issues on which such Shares may be voted is hereby
granted to active participants pursuant to this Section 15.5. Each such
person shall, for purposes of Section 402(a) (2) of the Employee
Retirement Income Security Act of 1974, as amended, be a "named
fiduciary" with respect to such power to direct the Trustee as to the
voting of
15-13
<PAGE 20>
such Shares as are subject to his direction as hereinafter provided.
Each such named fiduciary is described herein by qualification and shall
be identified by the Company at the appropriate time by application of
said description. Such power of direction shall be allocated among such
participants, former participants, beneficiaries and alternate payees as
follows:
(a) Each participant (whether or not he is an active
participant), former participant, beneficiary or
alternate payee shall be eligible to direct the Trustee
regarding the exercise of the right to vote of the number
of Shares of Class A and Class B Common Stock allocated
to his accounts; and
(b) Each active participant as of the record date for voting
on an Important Issue who has "Active Participant
Compensation", as hereinafter defined, also shall be
eligible to direct the Trustee regarding the exercise of
the right to vote on the Important Issue of that portion
of the total number of Shares of Class A and Class B
Common Stock held by the Trust Fund but not allocated to
any account equal to such total multiplied by his "Active
Participant Fraction" as hereinafter defined.
For purposes of this Section 15.5, the term "Active
Participant Compensation" shall mean, with respect to any active
participant described in subparagraph (b) above, his compensation as
defined in Section 2.10 hereof for the most recent plan year which ends
at least thirty-one (31) days prior to the record date as of which the
right to vote on the Important Issue is to be determined. If an active
participant has no such compensation, regardless of the reason
therefore, he shall be deemed to have no Active Participant Compensation
and shall not be eligible to direct the Trustee as hereinbefore provided
in subparagraph (b).
For purposes of this Section 15.5, each such active
participant's Active Participant Fraction shall be a fraction, the
15-14
<PAGE 21>
numerator of which shall be his "Active Participant Compensation" as
hereinbefore defined. The denominator of such fraction shall be the
aggregate Active Participant Compensation of all such active
participants who in fact direct the Trustee with respect to the exercise
of the right to vote such Shares with respect to the Important Issue.
The power of direction hereinbefore described in this Section
15.5 shall be exercised as follows:
(i) The Company shall furnish each person who is eligible to
direct the Trustee as hereinbefore described in
subparagraph (a) or (b) with one or more documents for
use in exercising such direction;
(ii) Such document or documents shall permit the person to
exercise such right separately with respect to:
(A) Class A Common Stock allocated to his accounts;
(B) Class B Common Stock allocated to his accounts;
and
(C) In the case of an Important Issue:
(I) That portion of the Class A Common Stock
which is not allocated to any account and
which is subject to his voting direction
pursuant to subparagraph (b) above; and
(II) That portion of the Class B Common Stock
which is not allocated to any account and
which is subject to his voting direction
pursuant to subparagraph (b) above;
(iii) If such person shall timely direct the Trustee with
respect to the voting of Shares allocated to his
accounts, the Trustee shall exercise the right to vote
such Shares in accordance with such direction; but if
he shall not so direct the Trustee, the Shares subject
to his direction shall not be voted;
(iv) If such person shall timely direct the Trustee with
respect to the voting on an Important Issue of
Class A Common Stock which is not allocated to any
15-15
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account, the Trustee shall vote the portion of the
aggregate unallocated Class A Common Stock which is
subject to his direction pursuant to subparagraph
(b) above in accordance with such direction; but if
he shall not so direct the Trustee, he shall be
disregarded in voting such Unallocated Class A
Common Stock;
(v) If such person shall timely direct the Trustee with
respect to the voting on an Important Issue of
Class B Common Stock which is not allocated to any
account, the Trustee shall vote the portion of the
aggregate unallocated Class B Common Stock which is
subject to his direction pursuant to subparagraph
(b) above in accordance with such direction; but if
he shall not so direct the Trustee, he shall be
disregarded in voting such unallocated Class B
Common Stock;
(vi) If an account contains a fractional Share, or if
application of the Active Participant Fraction
results in fractional Shares being subject to the
voting direction of an active participant on an
Important Issue, such Shares shall be aggregated
with Shares of the same type (i.e. Class A or Class
B) for which the voting direction is the same, for
voting purposes; but if there still remains a
fractional Share, such fractional Share shall be
voted if permitted by the rules governing such
voting or shall be considered an unallocated
fractional Share and not voted if fractional Shares
are not permitted to vote; and
(vii) In order to protect the anonymity of participants and
others eligible to direct the Trustee with respect to the
voting of Shares, the Administrator shall establish a
procedure for tallying and recording such directions
which will not reveal to the Trustee, Company, any
Participating Division or any affiliate of the Company,
to the extent reasonably practicable under the
circumstances, the identity of the participant or other
person giving a particular direction.
Under the Share accounting method generally described in
Article VII hereof, the total number of Shares of Class B Common Stock
deemed allocated to accounts plus the total number of Shares of Class B
Common Stock which are deemed unallocated will equal the total number of
Shares of Class B Common Stock held by the Trustee
15-16
<PAGE 23>
in the Trust Fund. However, under such Share accounting method, the
total number of Shares of Class A Common Stock deemed allocated to
accounts plus the total number of Shares of Class A Common Stock which
are deemed unallocated may not equal the total number of Shares of Class
A Common Stock held by the Trustee in the Trust Fund. Therefore,
notwithstanding any contrary provision of this Section 15.5, in order
for voting directions given or withheld under this Section 15.5 to
reflect the actual number of Shares of Class A Common Stock held by the
Trustee in the Trust Fund as of the appropriate date, the directions
given or withheld shall be deemed given or withheld with respect to an
adjusted number of Shares of Class A Common Stock. Such adjusted number
shall equal the number of Shares of Class A Common Stock over which the
person has voting direction power multiplied by a fraction. The
numerator of the fraction is the actual number of Shares of Class A
Common Stock held by the Trustee in the Trust Fund at the appropriate
time. The denominator of the fraction is the number of Shares of Class
A Common Stock deemed held by the Trustee at the same time under the
Share accounting method generally described in Article VII hereof.
15-17
<PAGE 24>
Voting (ESOP)
or in equity any rights or remedies in respect of any lease or mortgage
or of any guarantee pertaining to either of them;
(c) To exercise, personally or by general or limited proxy,
the right to vote any shares of stock or other securities held in the
investment fund; to delegate discretionary voting power to trustees of
a voting trust for any period of time; and to exercise or sell,
personally or by power of attorney, any conversion or subscription or
other rights appurtenant to any securities or other property held in the
investment fund;
(d) To join in or oppose any reorganization,
recapitalization, consolidation, merger or liquidation, or any plan
therefor, or any lease (with or without an option to purchase), mortgage
or sale of the property of any organization the securities of which are
held in the investment fund; to pay from the investment fund any
assessments, charges or compensation specified in any plan of
reorganization, recapitalization, consolidation, merger or liquidation,
to deposit any property with any committee or depositary; and to retain
any property allotted to the investment fund in any reorganization,
recapitalization, consolidation, merger or liquidation;
(e) To continue to hold any property of the investment fund
whether or not productive of income; to reserve from investment and keep
unproductive of income, without liability for interest, such cash as it
deems advisable or, in its discretion, to hold the same, without
limitation on duration, on deposit in the commercial department or in an
interest-bearing account in the savings department of any bank, trust
company, or savings and loan institution (including the Trustee where
applicable in its capacity as a banking corporation) in which deposits
are guaranteed by the Federal Deposit Insurance Corporation or the
Federal Savings and Loan Insurance Corporation;
(f) To make, execute and deliver, as Trustee, any deeds,
conveyances, leases (with or without option to purchase), mortgages,
options that the Trustee shall deem necessary or desirable in the
exercise of its powers under the investment fund;
(g) To commingle the assets of the investment fund with
assets of other trusts through the medium of the Figgie International
Inc. Investment Trust for Retirement Trusts established by the Company
by an agreement dated and executed on December 31, 1968, investing and
reinvesting the assets of the investment fund in Units, of such
Investment Trust, created or hereafter created pursuant to said
agreement, and in such proportions as the Company may deem advisable
from time to time, acting in its sole discretion. To the extent of
13-6
<PAGE 25>
stock split of Shares held hereunder, or acquired by the Trustee
pursuant to Section 15.1 hereof; to acquire Shares under installment
purchase arrangements, through the use of borrowed funds, or otherwise;
to exercise or waive any preemptive right to purchase additional Shares
to be issued by the Company; to exercise or let lapse any right of first
refusal, granted to the Trustee by the Certificate of Incorporation or
Bylaws of the Company or by any agreement between or among all or some
of the stockholders of the Company, to purchase all or a portion of any
Shares being offered for sale by a stockholder of the Company; to
exercise or let lapse any option to purchase' Shares granted to the
Trustee by the Certificate of Incorporation or Bylaws of the Company or
by any agreement between the Trustee and all or some of the other
stockholders of the Company; and except as otherwise stated in this
Article XV, to exercise all rights of ownership of the Shares;
(b) Pending investment in Shares pursuant to Section 15.1
hereof, to invest and reinvest any monies received by the Trustee in
short-term money market investments including short-term corporate,
individual or government obligations, whether secured or unsecured, time
or savings deposits of the Trustee or any parent or affiliate thereof if
such deposits bear a reasonable rate of interest or of any bank, trust
company, or savings and loan institution, which deposits may, but need
not be, guaranteed by the Federal Deposit Insurance Corporation or the
Federal Savings and Loan Insurance Corporation, or in shares of any
Regulated Investment Company, in units of any common trust fund or in
partnership interests of any partnership which Regulated Investment
Company, common trust fund or partnership invests in such short-term
money market instruments and deposits;
(c) Pending investment in Shares pursuant to Section 15.1 or
pursuant to Article XIII hereof, to invest a portion or all of the Trust
Fund, other than Shares, in units of any common or group trust created
solely for the purpose of providing a satisfactory diversification of
investments for participating trusts; provided that such common or group
trust, (i) limits participation thereunder to pension, profit sharing
and stock bonus trusts which qualify under Section 501(a) of the
Internal Revenue Code, (ii) prohibits income and/or principal
attributable to a participating trust from being used for any purpose
other than the exclusive benefit of the employees or their beneficiaries
of such participating trust, (iii) prohibits assignment by a
participating trust of any part of such participating trust's equity or
interest in the common or group trust, (iv) is created or organized in
the United States and is maintained at all times as a domestic trust in
the United States; as long as the Trustee holds such units hereunder,
the instrument establishing such common or group trust (including all
amendments thereto) shall be deemed to have been adopted and made a part
of this Trust and Plan;
(d) To exercise personally or by general or limited proxy,
the right to vote any Shares held in the Trust Fund; to
15-4
<PAGE 26>
delegate discretionary voting power to trustees of a voting trust for
any period of time; and to exercise or sell, personally or by power of
attorney, any conversion or subscription or other rights appurtenant to
any Shares or other property held in the Trust Fund, provided that, in
each instance described in Section 15.4 or 15.5 hereof, such power and
duty shall be subject to the direction of participants, former
participants, beneficiaries and "alternate payees" (as defined in
Section 17.1(a) hereof) pursuant to such Section 15.4 or 15.5;
(e) To borrow money from any lender (including the Trustee
hereunder, where applicable in its capacity as a banking corporation
when permitted to do so by the applicable laws and regulations then in
effect) in any amount and upon such terms and conditions and for such
purposes as the Trustee shall deem necessary; for any money so borrowed
the Trustee may issue its promissory note as Trustee and to secure the
repayment of any such loan, except a "loan" as defined in Section 2.24
hereof, may pledge or mortgage all or any part of the Trust Fund to
secure the repayment of any such loan, with interest, and no person
loaning money to the Trustee shall be obligated to see to the
application of the money loaned or to inquire into the validity,
expediency or propriety of any such borrowing;
(f) To compromise, settle or arbitrate any claim, debt or
obligation of or against the Trust Fund; to enforce or abstain from
enforcing any right, claim, debt or obligation; and to abandon any
property determined by it to be worthless;
(g) To reserve from investment in Shares and keep
unproductive of income, without liability for interest, such cash as it
deems advisable or, in its discretion, to hold the same, without
limitation on duration, on deposit in the commercial department or in an
interest-bearing account in the savings department of any bank, trust
company, or savings and loan institution (including the Trustee where
applicable in its capacity as a banking corporation);
(h) To hold property of the Trust Fund in its own name or in
the name of a nominee, without disclosure of this Trust, or in bearer
form so that it will pass by delivery, but no such holding shall relieve
the Trustee of its responsibility for the safe custody and disposition
of the Trust Fund in accordance with the provisions of this Trust and
Plan, and the Trustee's records shall at all times show that such
property is part of the Trust Fund;
(i) To make, execute and deliver, as Trustee, any contracts,
waivers or other instruments that the Trustee shall deem necessary or
desirable in the exercise of its powers under this Trust;
(j) To employ, at the expense of the Trust Fund, agents who
are not regular employees of the Trustee, and to delegate in
15-5
<PAGE 27>
Fund. Therefore, notwithstanding any contrary provision of this Section
15.4, in order for tender or exchange directions given or withheld under
this Section 15.4 to reflect the actual number of Shares of Class A
Common Stock held by the Trustee in the Trust Fund as of the appropriate
date, the directions given or withheld shall be deemed given or withheld
with respect to an adjusted number of Shares of Class A Common Stock.
Such adjusted number shall equal the number of Shares of Class A Common
Stock over which the person has tender or exchange direction power
multiplied by a fraction. The numerator of the fraction is the actual
number of Shares of Class A Common Stock held by the Trustee in the
Trust Fund at the appropriate time. The denominator of the fraction is
the number of Shares of Class A Common Stock deemed held by the Trustee
at the same time under the Share accounting method generally described
in Article VII hereof.
15.5 It is the purpose of this Section 15.5 to permit
participants, former participants, beneficiaries and "alternate payees"
(as defined in Section 17.1(a) hereof) to exercise substantial voting
rights under this Trust and Plan with respect to Shares allocated to
their accounts under this Trust and Plan because, except in the event of
forfeiture, they or their beneficiaries will eventually be entitled to
receive distribution thereof. Furthermore, active participants have the
expectancy that, if they continue in service with the Company,
unallocated Shares will be allocated to their accounts in the future and
eventually be distributed to them or their beneficiaries. It also may
be assumed that such allocation will be made on a basis roughly
15-11
<PAGE 28>
comparable to relative current compensation. It therefore is the
further purpose of this Section 15.5 to permit active participants to
exercise such substantial voting rights with respect both to Shares
allocated to their accounts and with respect to unallocated Shares, but
in the latter case, only with respect to "Important Issues" as
hereinafter defined in this Section 15.5 which justify the
administrative expense involved with exercise of such voting direction.
For purposes of this Section 15.5, "Important Issues" are corporate
matters involving the voting of such Shares with respect to the approval
or disapproval of any merger or consolidation, recapitalization,
reclassification, liquidation, dissolution or sale of substantially all
assets of the Company or with respect to any contested elections of
directors. While the foregoing list of Important Issues closely
parallels the list of issues indicated by Congress as important in
Section 409(e) (3) of the Internal Revenue Code, it is not intended
that, without formal amendment to the list of Important Issues contained
in this Trust and Plan, such list automatically change to reflect either
an amendment to Section 409(e) (3) of the Internal Revenue Code which
modifies the list of issues contained in said Section or the
promulgation of regulations thereunder. For the foregoing reasons, the
power to direct the Trustee regarding the exercise of the right to vote
the Shares in the Trust Fund allocated to their accounts with respect to
any matter on which such Shares may be voted is hereby granted to such
participants, former participants, beneficiaries and alternate payees
pursuant to this Section 15.5. Furthermore, for such reasons, the power
to direct the Trustee regarding the exercise of
15-12
<PAGE 29>
the right to vote the Shares in the Trust Fund which are not allocated
to any account with respect to Important Issues on which such Shares may
be voted is hereby granted to active participants pursuant to this
Section 15.5. Each such person shall, for purposes of Section 402(a)
(2) of the Employee Retirement Income Security Act of 1974, as amended,
be a "named fiduciary" with respect to such power to direct the Trustee
as to the voting of such Shares as are subject to his direction as
hereinafter provided. Each such named fiduciary is described herein by
qualification and shall be identified by the Company at the appropriate
time by application of said description. Such power of direction shall
be allocated among such participants, former participants, beneficiaries
and alternate payees as follows:
(a) Each participant (whether or not he is an active
participant), former participant, beneficiary or
alternate payee shall be eligible to direct the Trustee
regarding the exercise of the right to vote of the number
of Shares of Class A and Class B Common Stock allocated
to his accounts; and
(b) Each active participant as of the record date for voting
on an Important Issue who has "Active Participant
Compensation", as hereinafter defined, also shall be
eligible to direct the Trustee regarding the exercise of
the right to vote on the Important Issue of that portion
of the total number of Shares of Class A and Class B
Common Stock held by the Trust Fund but not allocated to
any account equal to such total multiplied by his "Active
Participant Fraction" as hereinafter defined.
For purposes of this Section 15.5, the term "Active
Participant Compensation" shall mean, with respect to any active
participant described in subparagraph (b) above, his compensation as
defined in Section 2.10 hereof for the most recent plan year which
ends at least thirty-one (31) days prior to the record date
15-13
<PAGE 30>
as of which the right to vote on the Important Issue is to be
determined. If an active participant has no such compensation,
regardless of the reason therefore, he shall be deemed to have no
Active Participant Compensation and shall not be eligible to direct
the Trustee as hereinbefore provided in subparagraph (b).
For purposes of this Section 15.5, each such active
participant's Active Participant Fraction shall be a fraction, the
numerator of which shall be his "Active Participant Compensation" as
hereinbefore defined. The denominator of such fraction shall be the
aggregate Active Participant Compensation of all such active
participants who in fact direct the Trustee with respect to the
exercise of the right to vote such Shares with respect to the
Important Issue.
The power of direction hereinbefore described in this
Section 15.5 shall be exercised as follows:
(i) The Company shall furnish each person who is eligible
to direct the Trustee as hereinbefore described in
subparagraph (a) or (b) with one or more documents for
use in exercising such direction;
(ii) Such document or documents shall permit the person to
exercise such right separately with respect to:
(A) Class A Common Stock allocated to his accounts;
(B) Class B Common Stock allocated to his accounts;
and
(C) In the case of an Important Issue:
(I) That portion of the Class A Common Stock
which is not allocated to any account and
which is subject to his voting direction
pursuant to subparagraph (b) above; and
15-14
<PAGE 31>
(II)That portion of the Class B Common Stock
which is not allocated to any account and
which is subject to his voting direction
pursuant to subparagraph (b) above;
(iii) If such person shall timely direct the Trustee
with respect to the Voting of Shares allocated to
his accounts, the Trustee shall exercise the
right to vote such Shares in accordance with such
direction; but if he shall not so direct the
Trustee, the Shares subject to his direction
shall not be voted;
(iv) If such person shall timely direct the Trustee with
respect to the voting on an Important Issue of Class A
Common Stock which is not allocated to any account, the
Trustee shall vote the portion of the aggregate
unallocated Class A Common Stock which is subject to
his direction pursuant to Subparagraph (b) above in
accordance with such direction; but if he shall not so
direct the Trustee, he shall be disregarded in voting
such unallocated Class A Common Stock;
(v) If such person shall timely direct the Trustee with
respect to the voting on an Important Issue of Class B
Common Stock which is not allocated to any account, the
Trustee shall vote the portion of the aggregate
unallocated Class B Common Stock which is subject to
his direction pursuant to subparagraph (b) above in
accordance with such direction; but if he shall not so
direct the Trustee, he shall be disregarded in voting
such unallocated Class B Common Stock;
(vi) If an account contains a fractional Share, or if
application of the Active Participant Fraction results in
fractional Shares being subject to the voting direction of
an active participant on an Important Issue, such Shares
shall be aggregated with Shares of the same type (i.e.
Class A or Class B) for which the voting direction is the
same, for voting purposes; but if there still remains a
fractional Share, such fractional Share shall be voted if
permitted by the rules governing such voting or shall be
considered an unallocated fractional Share and not voted if
fractional Shares are not permitted to vote; and
(vii) In order to protect the anonymity of
participants and others eligible to direct the
Trustee with respect to the voting of Shares,
the Administrator shall establish a procedure
for tallying and recording such directions
which will not reveal to
15-15
<PAGE 32>
the Trustee, Company, any Participating Division or
any affiliate of the Company, to the extent
reasonably practicable under the circumstances, the
identity of the participant or other person giving
a particular direction.
Under the Share accounting method generally described in
Article VII hereof, the total number of Shares of Class B Common
Stock deemed allocated to accounts plus the total number of Shares
of Class B Common Stock which are deemed unallocated will equal the
total number of Shares of Class B Common Stock held by the Trustee
in the Trust Fund. However, under such Share accounting method,
the total number of Shares of Class A Common Stock deemed allocated
to accounts plus the total number of Shares of Class A Common Stock
which are deemed unallocated may not equal the total number of
Shares of Class A Common Stock held by the Trustee in the Trust
Fund. Therefore, notwithstanding any contrary provision of this
Section 15.5, in order for voting directions given or withheld
under this Section 15.5 to reflect the actual number of Shares of
Class A Common Stock held by the Trustee in the Trust Fund as of
the appropriate date, the directions given or withheld shall be
deemed given or withheld with respect to an adjusted number of
Shares of Class A Common Stock. Such adjusted number shall equal
the number of Shares of Class A Common Stock over which the person
has voting direction power multiplied by a fraction. The numerator
of the fraction is the actual number of Shares of Class A Common
Stock held by the Trustee in the Trust Fund at the appropriate
time. The denominator of the fraction is the number of Shares of
Class A Common Stock deemed held by the Trustee at the same time
15-16
<PAGE 33>
under the Share accounting method generally described in Article
VII hereof.
15-17
<PAGE 34>
Voting (Stock Bonus)
or in equity any rights or remedies in respect of any lease or
mortgage or of any guarantee pertaining to either of them;
(c) To exercise, personally or by general or limited
proxy, the right to vote any shares of stock or other securities
held in the investment fund; to delegate discretionary voting power
to trustees of a voting trust for any period of time; and to
exercise or sell, personally or by power of attorney, any
conversion or subscription or other rights appurtenant to any
securities or other property held in the investment fund;
(d) To join in or oppose any reorganization, recapitalization,
consolidation, merger or liquidation, or any plan therefor, or any lease
(with or without an option to purchase), mortgage or sale of the
property of any organization the securities of which are held in the
investment fund; to pay from the investment fund any assessments,
charges or compensation specified in any plan of reorganization,
recapitalization, consolidation, merger or liquidation, to deposit any
property with any committee or depositary; and to retain any property
allotted to the investment fund in any reorganization, recapitalization,
consolidation, merger or liquidation;
(e) To continue to hold any property of the investment fund
whether or not productive of income; to reserve from investment and keep
unproductive of income, without liability for interest, such cash as it
deems advisable or, in its discretion, to hold the same, without
limitation on duration, on deposit in the commercial department or in an
interest-bearing account in the savings department of any bank, trust
company, or savings and loan institution (including the Trustee where
applicable in its capacity as a banking corporation) in which deposits
are guaranteed by the Federal Deposit Insurance Corporation or the
Federal Savings and Loan Insurance Corporation;
(f) To make, execute and deliver, as Trustee, any deeds,
conveyances, leases (with or without option to purchase), mortgages,
options that the Trustee shall deem necessary or desirable in the
exercise of its powers under the investment fund;
(g) To commingle the assets of the investment fund with assets of
other trusts through the medium of the Figgie International Inc.
Investment Trust for Retirement Trusts established by the Company by an
agreement dated and executed on December 31, 1968, investing and
reinvesting the assets of the investment fund in Units, of such
Investment Trust, created or hereafter created pursuant to said
agreement, and in such proportions as the Company may deem advisable
from time to time, acting in its sole discretion. To the extent of
12-6
<PAGE 35>
whether secured or unsecured, time or savings deposits of the Trustee or
any parent or affiliate thereof if such deposits bear a reasonable rate
of interest or of any bank, trust company, or savings and loan
institution, which deposits may, but need not be, guaranteed by the
Federal Deposit Insurance Corporation or the Federal Savings and Loan
Insurance Corporation, or in shares of any Regulated Investment Company,
in units of any common trust fund or in partnership interests of any
partnership which Regulated Investment Company, common trust fund or
partnership invests in such short-term money market instruments and
deposits;
(c) Pending investment in Shares pursuant to Section 14.1 hereof
or pursuant to Article XII hereof, to invest a portion or all of the
Trust Fund, other than Shares, in units of any common or group trust
created solely for the purpose of providing a satisfactory
diversification of investments for participating trusts; provided that
such common or group trust, (i) limits participation thereunder to
pension, profit sharing and stock bonus trusts which qualify under
Section 501(a) of the Internal Revenue Code, (ii) prohibits income
and/or principal attributable to a participating trust from being used
for any purpose other than the exclusive benefit of the employees or
their beneficiaries of such participating trust, (iii) prohibits
assignment by a participating trust of any part of such participating
trust's equity or interest in the common or group trust, (iv) is created
or organized in the United States and is maintained at all times as a
domestic trust in the United States; as long as the Trustee holds such
units hereunder, the instrument establishing such common or group trust
(including all amendments thereto) shall be deemed to have been adopted
and made a part of this Trust and Plan;
(d) To exercise personally or by general or limited proxy, the
right to vote any Shares held in the Trust Fund; to delegate
discretionary voting power to trustees of a voting trust for any period
of time; and to exercise or sell, personally or by power of attorney,
any conversion or subscription or other rights appurtenant to any Shares
or other property held in the Trust Fund, provided that, in each
instance described in Section 14.4 or 14.5 hereof, such power and duty
shall be subject to the direction of participants, former participants,
beneficiaries and "alternate payees" (as defined in Section 16.1(a)
hereof) pursuant to such Section 14.4 or 14.5;
(e) To borrow money from any lender (including the Trustee
hereunder, where applicable in its capacity as a banking corporation
when permitted to do so by the applicable laws and regulations then in
effect) in any amount and upon such terms and conditions and for such
purposes as the Trustee shall deem necessary; for any money so borrowed
the Trustee may issue its promissory note as Trustee and may pledge or
14-4
<PAGE 36>
number of Shares of Class A Common Stock. Such adjusted number shall
equal the number of Shares of Class A Common Stock over which the person
has tender or exchange direction power multiplied by a fraction. The
numerator of the fraction is the actual number of Shares of Class A
Common Stock held by the Trustee in the Trust Fund at the appropriate
time. The denominator of the fraction is the number of Shares of Class
A Common Stock deemed held by the Trustee at the same time under the
Share accounting method generally described in Article VII hereof.
14.5 It is the purpose of this Section 14.5 to permit
participants, former participants, beneficiaries and "alternate payees"
(as defined in Section 16.1(a) hereof) to exercise substantial voting
rights under this Trust and Plan with respect to Shares allocated to
their accounts under this Trust and Plan because, except in the event of
forfeiture, they or their beneficiaries will eventually be entitled to
receive distribution thereof. Furthermore, active participants have the
expectancy that, if they continue in service with the Company,
unallocated Shares will be allocated to their accounts as of the end of
the plan year in which they are received by the Trust Fund and
eventually be distributed to them or their beneficiaries. It also may
be assumed that such allocation will be made on a basis roughly
Comparable to relative current compensation. It therefore is the
further purpose of this Section 14.5 to permit active participants to
exercise such substantial voting rights with respect both to Shares
allocated to their accounts and with respect to unallocated Shares, but
in the latter case, only with respect to "Important
14-11
<PAGE 37>
Issues" as hereinafter defined in this Section 14.5 which justify the
administrative expense involved with exercise of such voting direction.
For purposes of this Section 14.5, "Important Issues" are corporate
matters involving the voting of such Shares with respect to the approval
or disapproval of any merger or consolidation, recapitalization,
reclassification, liquidation, dissolution or sale of substantially all
assets of the Company or with respect to any contested elections of
directors. While the foregoing list of Important Issues parallels the
list of issues indicated by Congress as important in Section 409(e) (3)
of the Internal Revenue Code, it is not intended that, without formal
amendment to the list of Important Issues contained in this Trust and
Plan, such list automatically change to reflect either an amendment to
Section 409(e) (3) of the Internal Revenue Code which modifies the list
of issues contained in said Section or the promulgation of regulations
thereunder. For the foregoing reasons, the power to direct the Trustee
regarding the exercise of the right to vote the Shares in the Trust Fund
allocated to their accounts with respect to any matter on which such
Shares may be voted is hereby granted to such participants, former
participants, beneficiaries and alternate payees pursuant to this
Section 14.5. Furthermore, for such reasons, the power to direct the
Trustee regarding the exercise of the right to vote the Shares in the
Trust Fund which are not allocated to any account with respect to
Important Issues on which such Shares may be voted is hereby granted to
active participants pursuant to this Section 14.5. Each such person
shall, for purposes of Section 402(a) (2) of the
14-12
<PAGE 38>
Employee Retirement Income Security Act of 1974, as amended, be a "named
fiduciary" with respect to such power to direct the Trustee as to the
voting of such Shares as are subject to his direction as hereinafter
provided. Each such named fiduciary is described herein by
qualification and shall be identified by the Company at the appropriate
time by application of said description. Such power of direction shall
be allocated among such participants, former participants, beneficiaries
and alternate payees as follows:
(a) Each participant (whether or not he is an active
participant), former participant, beneficiary alternate
payee shall be eligible to direct the Trustee regarding
the exercise of the right to vote of the number of Shares
of Class A and Class B Common Stock allocated to his
accounts; and
(b) Each active participant as of the record date for voting
on an Important Issue who has "Active Participant
Compensation", as hereinafter defined, also shall be
eligible to direct the Trustee regarding the exercise of
the right to vote on the Important Issue of that portion
of the total number of Shares of Class A and Class B
Common Stock held by the Trust Fund but not allocated to
any account equal to such total multiplied by his "Active
Participant Fraction" as hereinafter defined.
For purposes of this Section 14.5, the term "Active
Participant Compensation" shall mean, with respect to any active
participant described in subparagraph (b) above, his compensation as
defined in Section 2.9 hereof for the most recent plan year which ends
at least thirty-one (31) days prior to the record date as of which the
right to vote on the Important Issue is to be determined. If an active
participant has no such compensation, regardless of the reason
therefore, he shall be deemed to have no Active Participant Compensation
and shall not be eligible to direct the Trustee as hereinbefore provided
in subparagraph (b).
14-13
<PAGE 39>
For purposes of this Section 14.5, each such active
participant's Active Participant Fraction shall be a fraction, the
numerator of which shall be his "Active Participant Compensation" as
hereinbefore defined. The denominator of such fraction shall be the
aggregate Active Participant Compensation of all such active
participants who in fact direct the Trustee with respect to the exercise
of the right to vote such Shares with respect to the Important Issue.
The power of direction hereinbefore described in this Section
14.5 shall be exercised as follows:
(i) The Company shall furnish each person who is eligible to
direct the Trustee as hereinbefore described in
subparagraph (a) or (b) with one or more documents for
use in exercising such direction;
(ii) Such document or documents shall permit the person to
exercise such right separately with respect to:
(A) Class A Common Stock allocated to his accounts;
(B) Class B Common Stock allocated to his accounts;
and
(C) In the case of an Important Issue:
(I) That portion of the Class A Common Stock
which is not allocated to any account and
which is subject to his voting direction
pursuant to subparagraph (b) above; and
(II) That portion of the Class B Common Stock
which is not allocated to any account and
which is subject to his voting direction
pursuant to subparagraph (b) above;
(iii) If such person shall timely direct the Trustee with
respect to the voting of Shares allocated to his
accounts, the Trustee shall exercise the right to vote
such Shares in accordance with such direction; but if
he shall not so direct the Trustee, the Shares subject
to his direction shall not be voted;
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(iv)If such person shall timely direct the Trustee with
respect to the voting on an Important Issue of
Class A Common Stock which is not allocated to any
account, the Trustee shall vote the portion of the
aggregate unallocated Class A Common Stock which is
subject to his direction pursuant to subparagraph
(b) above in accordance with such direction; but if
he shall not so direct the Trustee, he shall be
disregarded in voting such unallocated Class A
Common Stock;
(v) If such person shall timely direct the Trustee with
respect to the voting on an Important Issue of
Class B Common Stock which is not allocated to any
account, the Trustee shall vote the portion of the
aggregate unallocated Class B Common Stock which is
subject to his direction pursuant to subparagraph
(b) above in accordance with such direction; but if
he shall not so direct the Trustee, he shall be
disregarded in voting such unallocated Class B
Common Stock;
(vi) If an account contains a fractional Share, or if
application of the Active Participant Fraction
results in fractional Shares being subject to the
voting direction of an active participant on an
Important Issue, such Shares shall be aggregated
with Shares of the same type (i.e. Class A or Class
B) for which the voting direction is the same, for
voting purposes; but if there still remains a
fractional Share, such fractional Share shall be
voted if permitted by the rules governing such
voting or shall be considered an unallocated
fractional Share and not voted if fractional Shares
are not permitted to vote; and
(vii) In order to protect the anonymity of participants and
others eligible to direct the Trustee with respect to the
voting of Shares, the Administrator shall establish a
procedure for tallying and recording such directions
which will not reveal to the Trustee, Company, any
Participating Division or any affiliate of the Company,
to the extent reasonably practicable under the
circumstances, the identity of the participant or other
person giving a particular direction.
Under the Share accounting method generally described in
Article VII hereof, the total number of Shares of Class B Common Stock
deemed allocated to accounts plus the total number of Shares
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<PAGE 41>
of Class B Common Stock which are deemed unallocated will equal the
total number of Shares of Class B Common Stock held by the Trustee in
the Trust Fund. However, under such Share accounting method, the total
number of Shares of Class A Common Stock deemed allocated to accounts
plus the total number of Shares of Class A Common stock which are deemed
unallocated may not equal the total number of Shares of Class A Common
stock held by the Trustee in the Trust Fund. Therefore, notwithstanding
any contrary provision of this section 14.5, in order for voting
directions given or withheld under this Section 14.5 to reflect the
actual number of shares of Class A Common Stock held by the Trustee in
the Trust Fund as of the appropriate date, the directions given or
withheld shall be deemed given or withheld with respect to an adjusted
number of Shares of Class A Common Stock. Such adjusted number shall
equal the number of Shares of Class A Common Stock over which the person
has voting direction power multiplied by a fraction. The numerator of
the fraction is the actual number of Shares of Class A Common Stock held
by the Trustee in the Trust Fund at the appropriate time. The
denominator of the fraction is the number of Shares of Class A Common
Stock deemed held by the Trustee at the same time under the Share
accounting method generally described in Article VII hereof.
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