SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
Amendment No. 1
(Mark One)
{X} ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1994
OR
{ } TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _________ to ___________
Commission File Number: 1-8591
FIGGIE INTERNATIONAL INC.
(Exact name of registrant as specified in its charter)
Delaware 52-1297376
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
4420 Sherwin Road
Willoughby, Ohio 44904
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (216) 953-2700
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
10-3/8% Subordinated Debentures Pacific Stock Exchange Inc.
Securities registered pursuant to Section 12(g) of the Act:
Class A Common Stock, par value $.10 per share
Title of class
Class B Common Stock, par value $.10 per share
Title of class
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to the filing
requirements for at least the past 90 days. Yes {X} No { }
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
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and will not be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K. {X}
State the aggregate market value of the voting stock held by
nonaffiliates of the registrant. The aggregate market value
shall be computed by reference to the price at which the stock
was sold, or the average bid and asked prices of such stock, as
of a specified date within 60 days prior to the date of filing.
(See the definition of affiliate in Rule 405.)
At 4/10/95 $150,108,773
Indicate the number of shares outstanding of each of the
registrant's classes of common stock, as of the latest
practicable date.
_________________________________________________________________
Class A Common Stock, Par Value $0.10 Per share
(13,670,916 shares outstanding as of 4/10/95)
Class B Common Stock, Par Value $0.10 Per share
(4,724,869 shares outstanding as of 4/10/95)
2 <PAGE>
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FIGGIE INTERNATIONAL INC.
Figgie International Inc., the registrant, hereby
amends the following items of its Annual Report on Form 10-K for
1994 as set forth in the pages attached hereto:
Items 10, 11, 12, 13
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Item 10. Directors and Executive Officers of the Registrant
(a) Identification of Directors
Three Year Term
Served as Expires at Annual
Director Meeting of
Name and Principal Occupation Since Stockholders in
FRED J. BRINKMAN, age 66 1992 1995
Consultant; former Partner, Arthur
Andersen LLP, public accountants,
Senior Partner, Asia - Pacific area
from 1978 to 1989 and Managing
Partner of the firm's Washington,
D.C. office from 1981 to 1987;
Director, Washington Gas Light Co.
and Charles E. Smith Residential
Realty Inc.
VINCENT A. CHIARUCCI, age 65 1989 1995
Retired; former President and Chief
Operating Officer of Figgie
International Inc., 1989 to 1995;
Group Vice President of Figgie
International Inc.'s Safety Products
Distribution Group from 1988 to
1989; Business Consultant
(self-employed) from 1986 to 1988;
Director, Community Mutual Insurance
Company.
DALE S. COENEN, age 66(1)
President and Director, Coenen & 1964 1995
Co., Inc., investments; Chairman of
the Board and President,
Trans-Industries, Inc., manufacturer
of electronic information systems,
environmental systems and mechanical
assemblies; Director, The
Clark-Reliance Corporation.
(1) See discussion under the caption "CERTAIN TRANSACTIONS."
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Three Year Term
Served as Expires at Annual
Director Meeting of
Name and Principal Occupation Since Stockholders in
JOHN P. REILLY, age 51 1995 1995
Chief Executive Officer, Figgie
International Inc., since January 4,
1995; President, Figgie
International Inc., since February
1, 1995; former President and Chief
Operating Officer, Brunswick
Corporation, 1993-1994; former
President and Chief Executive
Officer, Tenneco Automotive, 1987-
1993; Director, Trinova Corporation;
Director, Atwood Industries;
Director, Barat College.
HAROLD B. SCOTT, age 77 1974 1995
Retired; Director, Key Trust N.A.;
Chairman of the Board and Chief
Executive Officer, Harold B. Scott,
Inc.; former Chairman of the Board,
Syracuse Supply Co.; former Chairman
of the Board, Givaudan Corp.; former
President and Chief Executive
Officer, U.S.-U.S.S.R. Trade and
Economic Council, Inc.; former
Assistant Secretary, U.S. Department
of Commerce.
ALFRED V. GANGNES, age 74 1972 1996
Retired; former President, Figgie
International Inc.; former Director,
Evaluation Research Corporation.
JOHN S. LANAHAN, age 72 1985 1996
Consultant; former Senior Vice
President-Commercial, Chessie System
Railroads; former President and
Managing Director, the Greenbrier
Resort Hotel.
F. RUSH McKNIGHT, age 65(1) 1985 1996
Partner, Calfee, Halter & Griswold,
Cleveland, Ohio, law firm; Managing
Partner from 1985 to 1991.
(1) See discussion under the caption "CERTAIN TRANSACTIONS."
2 <PAGE>
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Three Year Term
Served as Expires at Annual
Director Meeting of
Name and Principal Occupation Since Stockholders in
HARRISON NESBIT, II, age 68 1969 1996
Retired; Chairman and
Director, Godine, Nesbit, McCabe &
Co., an insurance brokerage firm, from
1987 to 1993; former General Agent,
State of Virginia, Massachusetts Mutual
Life Insurance Co.; Director, St. George
Metals, Inc.; Director, O-Three
Limited.
C.B. ROBERTSON, III, age 60 1986 1997
President, CBR Associates, Inc.,
real estate development.
STEVEN L. SIEMBORSKI, age 40 1994 1997
Senior Vice President and Chief
Financial Officer, Figgie
International Inc., since July 1,
1994; former Partner, Ernst & Young;
Certified Public Accountant.
A.A. SOMMER, JR., age 71 1986 1997
Counsel, Morgan, Lewis & Bockius,
Washington, D.C., law firm, since
October 1, 1994; former Partner,
Morgan, Lewis & Bockius, 1979-1994;
Chairman, Public Oversight Board of
the American Institute of Certified
Public Accountants; Vice Chairman,
Board of Governors, National
Association of Securities Dealers.
WALTER M. VANNOY, age 67
Chairman of the Board, Figgie 1981 1997
International Inc., since May 18,
1994; former Chief Executive
Officer, Figgie International Inc.,
1994-1995; former Vice Chairman of
the Board, Figgie International
Inc., February 1994 - May 1994;
President, Vannoy Enterprises;
Director, Illinois Power Company;
Director, ChemPower, Inc.; former
Vice Chairman, McDermott
International Inc.; former President
and Chief Operating Officer, Babcock
& Wilcox.
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(b) Identification of Executive Officers
Information with respect to the Executive Officers of
the Corporation is set forth under the caption "Executive
Officers of the Registrant" contained in Part I, Item 1 of the
Corporation's 1994 Form
10-K, which information is incorporated herein by reference.
Item 11. Executive Compensation
DIRECTORS' COMPENSATION
The Directors, except for those who are also employees
of the Corporation, receive an annual stipend of $20,000. In
addition, the non-employee members of the Finance & Executive
Committee receive $9,000 per year and members of the remaining
committees other than the Stock Option Committee receive $6,000
per year. The non-employee chairmen of committees receive an
additional $1,000 per year for each chairmanship held except for
the Chairman of the Stock Option Committee.
The Corporation has agreed to pay a death benefit, in
the amount of $200,000 to the estate of each Director, other than
a director who is also an employee, upon his death. This benefit
is provided to a Director while in office and after retirement if
he has served five (5) years. The benefit is payable from the
general assets of the Corporation and the Corporation has insured
this liability by purchasing life insurance policies on the lives
of the eligible Directors.
The Board of Directors and committee members also
receive travel and lodging expenses in connection with their
attendance at Board and committee meetings.
EXECUTIVE COMPENSATION
Summary of Compensation
The following table shows information concerning the annual
and long-term compensation earned during the last three fiscal
years by the Corporation's Chief Executive Officer as of December
31, 1994, each of the four other most highly compensated
executives of the Corporation, and Harry E. Figgie, Jr., who
resigned as Chief Executive Officer on May 18, 1994.
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<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
Long Term
Compensation
Awards
Annual Compensation
Name and Other Restricted
Principal Annual Stock All Other
Position Year Salary Bonus(1) Compensation(2) Award(s) (3) Compensation(4)
<S> <C> <C> <C> <C> <C> <C>
Walter M. Vannoy (5) 1994 $333,333 0 $ 62,599 $1,039,563 $ 61,694
Chairman and CEO
Vincent Chiarucci 1994 394,375 0 - 43,097
President 1993 371,875 0 1,434,825 47,838
1992 331,250 $332,050 - 39,187
L. A. Harthun 1994 229,166 0 - 18,520
Senior Vice President 1993 219,000 0 277,405 23,026
International, General Counsel
and Secretary 1992 207,333 189,856 - 26,723
Steven L. Siemborski (6) 1994 175,000 25,000 248,438 60,363
Senior Vice President and
Chief Financial Officer
Charles C. Rieger, Jr. 1994 168,000 0 - 16,191
Senior Vice President 1993 161,000 0 - 19,210
1992 156,667 50,000 - 20,751
Harry E. Figgie, Jr. 1994 293,769 0 68,381 - 521,618
Former Chairman and CEO 1993 775,000 0 118,861 2,539,087 644,541
1992 695,000 663,692 92,758 - 957,662
<FN>
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(1) (a) Includes, except with respect to Mr. Siemborski, the full amount of the discretionary component
of the bonus awarded with respect to the applicable fiscal year, although only one quarter of that
bonus is paid in the year it is declared and the remaining three quarters of that bonus are paid in
equal installments in each of the three years after the discretionary bonus is declared if the
executive continues to be employed by the Corporation or if the termination of employment is due to
death, disability or retirement. In cases of termination for any other reason, the Compensation
Committee has sole discretion to determine whether the remaining bonus installments will be paid.
(b) Mr. Siemborski earned a $25,000 incentive bonus pursuant to the terms of his employment
agreement discussed in the section entitled "Employment and Severance Agreements."
(2) (a) The amount indicated represents Mr. Vannoy's use of a company car ($9,735) and Mr. Vannoy's
moving expenses ($52,864).
(b) The amounts indicated represent the incremental cost to the Corporation of expenses associated
with Mr. Figgie's use of a company car ($47,632, $46,971 and $34,653, in 1994, 1993 and 1992, respectively),
aircraft ($8,558, $19,078 and $26,354, in 1994, 1993 and 1992, respectively) and club dues ($12,195,
$39,753 and $31,751, in 1994, 1993 and 1992, respectively), and, for 1993, $13,059 relating to an
interest free loan provided to Mr. Figgie at the time the restrictions on the restricted stock issued
under the 1988 Restricted Stock Purchase Plan for Employees (the "1988 Restricted Stock Plan") were
terminated in December 1992.
(3) The transfer and pledge restrictions on the restricted shares reflected in the table with respect to
1994 and 1993 are scheduled to lapse upon the termination of the Restricted Stock Plan on July 1,
1998 under the terms of the plan. As of December 31, 1994, the aggregate number and the value of the
shares (less the purchase price paid by the executive) of restricted stock held by the executives
were as follows: Mr. Vannoy, 98,744 shares of Class A Common Stock and 16,753 shares of Class B
Common Stock having a market value (less purchase price) of $594,016; Mr. Chiarucci, 91,000 shares of
Class A Common Stock having a market value (less purchase price) of $466,888; Mr. Harthun, 17,613
shares of Class A Common Stock having a market value (less purchase price) of $90,267;
Mr. Siemborski, 37,500 shares of Class A Common Stock having a market value (less purchase price) of
$192,188; Mr. Rieger, 17,613 shares of Class A Common Stock having a market value (less purchase
price) of $90,267; Mr. Figgie, 5,645 shares of Class A Common Stock and 10,000 shares of Class B
Common Stock having a market value (less purchase price) of $81,431.
(4) (a) Includes the rating payment paid by the Corporation on a split-dollar insurance policy for the
benefit of Mr. Figgie and the discounted value of the benefit to each of the Executive Officers named
in the Summary Compensation Table (the "named executive officers") of the premium paid by the
Corporation during 1994 for one or more split-dollar insurance policies under which the executive
receives an interest in the cash surrender value of the policy at the time when the ownership of the
policy is split between the executive and the Corporation, which then becomes the beneficiary of a
policy on the executive's life with a cash surrender value equivalent to the Corporation's premium
payments. The Executive Officers paid a portion of the premium based upon a rate for term life
insurance. The amounts reflected in the table for split-dollar insurance are as follows:
Mr. Vannoy -- $41,387; Mr. Chiarucci -- $39,540; Mr. Harthun -- $13,446; Mr. Siemborski -- $8,203;
Mr. Rieger -- $11,777; and Mr. Figgie -- $113,916.
(b) Includes the monthly payments made by the Corporation to Mr. Figgie for 1994 in the aggregate
amount of $407,702 under the Corporation's Senior Executive Benefits Program. The program formerly
provided retirement and other benefits prior to retirement in the event that a person remained an
employee of the Corporation after the normal retirement date of age 65 (or, in certain circumstances,
age 62).
(c) Includes the allocations for 1994 of equivalent shares of Class A Common Stock or Class B Common
Stock under the Figgie International Inc. Stock Ownership Trust and Plan (the "ESOP"), the ESOP for
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Salaried Employees and the Figgie International Inc. Stock Bonus Trust and Plan (the "Stock Bonus
Plan"). The dollar values as of December 31, 1994 of the allocations for each of the named executive
officers of the Corporation are as follows: Mr. Vannoy -- $3,557; Mr. Chiarucci -- $3,557; Mr.
Harthun -- $5,074; Mr. Siemborski -- $2,160; and Mr. Rieger -- $4,414.
(d) Includes fees paid to Mr. Vannoy in the amount of $16,750 for services as a director of the
Corporation.
(e) Includes $50,000 paid to Mr. Siemborski pursuant to the terms of his employment agreement. See
the section entitled "Employment and Severance Agreements."
(5) Mr. Vannoy became CEO of the Corporation on May 18, 1994 and Vice Chairman of the Corporation on
February 16, 1994. He was not employed by the Corporation as an officer prior to 1994.
(6) Mr. Siemborski became Senior Vice President and Chief Financial Officer of the Corporation effective
July 1, 1994. He was not employed by the Corporation prior to 1994.
</TABLE>
RETIREMENT PLANS
Retirement Income Plan II
All of the Executive Officers of the Corporation are
currently accruing retirement income credits under, or will
accrue them upon their satisfaction of the eligibility
requirements set forth in, the Salaried Employee Retirement
Income Provisions of the Figgie International Inc. Retirement
Income Plan II (the "Salaried Provisions"), a defined benefit
pension plan. The Salaried Provisions cover the salaried
employees of the Corporation except employees of certain
non-participating divisions and subsidiaries. Directors who are
not employees are not entitled to receive retirement benefits
under the Retirement Income Plan II.
In general, the Salaried Provisions, as adopted effective
July 31, 1993, provide that salaried employees accrue dollar
units of retirement income credits for each calendar year of
participation in the Salaried Provisions on the basis of their
"Annual Pensionable Earnings." To receive full benefits under
the Salaried Provisions, employees must contribute 2% of their
"Annual Pensionable Earnings" over their "Covered Compensation."
The following sets forth the percentage Annual Pensionable
Earnings which is accrued as a Retirement Income Credit under the
Salaried Provision:
Annual Pensionable Earnings (1)
0-100% of Over 100% of
Covered Covered
Compensation Compensation
(2) (2)
Retirement Income Credit 0.7% 1.2%
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(1) "Annual Pensionable Earnings" includes cash salaries and
bonuses received by the participant but excludes any such
earnings in excess of $150,000 for calendar year 1995 and
$150,000 thereafter (plus any increase for cost-of-living as
shall be prescribed by the Secretary of the Treasury
pursuant to Sections 401(a)(17) and 415(d) of the Internal
Revenue Code).
(2) "Covered Compensation" means the average of the
contributions and benefit bases in effect under Section 230
of the Social Security Act for each such calendar year in
the 35 calendar years ending immediately prior to each
calendar year. For calendar year 1995, Covered Compensation
will equal $24,312.
Generally, any salaried employee of the Corporation except
employees of certain nonparticipating divisions and subsidiaries
is eligible to participate in the Salaried Provisions after the
earlier of the completion of one year of service or attainment of
age 40. A participant becomes vested in the Salaried Provisions
five years after the participant's hire date. Upon reaching
normal retirement at age 65, each participant is generally
entitled to receive an annual retirement benefit for life equal
to the total of the retirement income credits accrued by him
during his period of participation. Such benefit is not subject
to any deduction for Social Security benefits. A reduced annual
retirement income benefit may be payable to a retired employee
under other actuarially equivalent forms of pay-out provided for
in the Salaried Provisions. The Salaried Provisions also contain
provisions for early retirement and preretirement death benefits
payable to spouses and dependent children of certain deceased
participants. During 1993, certain employees of the Corporation
and its subsidiaries accrued retirement benefits under separate
retirement plans of the Corporation which cover employees of its
divisions or subsidiaries which are not or were not at the time
participating under the Salaried Provisions or a prior plan which
was terminated on November 21, 1988 (the "Prior Plan").
As of December 31, 1994, the annual benefits payable upon
retirement under the Salaried Provisions, including accrued
benefits from the Prior Plan, to the individuals named in the
Summary Compensation Table are stated below. In determining such
benefits, the executives' earnings were estimated through 1995
and were assumed not to exceed $150,000 after 1995. Covered
Compensation ($24,312 for 1995) was assumed not to increase after
1995, the maximum allowable employer-funded benefit under the
Internal Revenue Code (which is the greater of $118,800 or the
accrued benefit as of December 31, 1982) was assumed to continue
to retirement and executives were assumed to continue working
until at least age 65 and to be fully vested. Based upon the
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preceding assumptions, the annual benefits payable to such
persons including benefits payable as a result of voluntary
contributions and the accrued benefits from the Prior Plan are as
follows: Mr. Vannoy -- $133; Mr. Chiarucci -- $13,704; Mr.
Harthun -- $99,770; Mr. Siemborski -- $42,219; Mr. Rieger --
$44,118; and Mr. Figgie -- $130,590.
Senior Executive Benefits Program
The following plan table shows the annual benefits upon
retirement at age 65 in 1994 for various combinations of
compensation and lengths of service which may be payable under
the Corporation's Senior Executive Benefits Program (the "SEBP")
to the named executive officers. These amounts are paid in
addition to the amounts payable under the Corporation's Salaried
Provisions discussed above.
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<TABLE>
PENSION PLAN TABLE
<CAPTION>
Annual Benefit for Years
Remuner- of Credited Service Shown(1)
ation(2)
10 Years 15 Years 20 Years 25 Years 30 Years 35 Years
<S> <C> <C> <C> <C> <C> <C>
$125,000 $ 15,800 $ 38,991 $ 32,099 $ 25,207 $ 18,314 $ 11,423
150,000 26,634 50,741 42,349 33,957 25,565 17,173
175,000 37,667 66,991 58,599 50,207 41,815 33,423
200,000 48,301 83,241 74,849 66,457 58,065 49,673
225,000 59,134 99,491 91,099 82,707 74,315 65,923
250,000 69,967 115,741 107,349 98,957 90,565 82,173
300,000 91,634 148,241 139,849 131,457 123,065 114,673
400,000 134,967 213,241 204,849 196,457 188,065 179,673
450,000 156,634 245,741 237,349 228,957 220,565 212,173
500,000 178,300 278,241 269,849 261,457 253,065 244,673
<FN>
(1) Annual benefits are computed on the basis of 100% joint and survivor benefit. The annual benefits
reflected in the table constitute 65% of final covered remuneration, less assumed social security
benefits of $21,582 and less assumed amounts of benefits payable under the Salaried Provisions. The
benefits under the Salaried Provisions have been calculated based upon the assumptions that the
amount of Covered Compensation, as defined in the Salaried Provisions, remains fixed and the amount
of Annual Pensionable Earnings, as defined in the Salaried Provisions, is limited to amounts that do
not exceed $150,000. (See the description of the Salaried Provisions set forth above.) The annual
benefits will be increased by 10% of the final covered remuneration for a participant in the SEBP as
of February 18, 1987 or a person hired prior to February 18, 1987 who completes 20 years of service.
The annual benefits will be reduced by any retirement or deferred compensation plans of other
employers.
(2) Consists of base salary and the installment payments that have been received by an executive under
the discretionary bonus component of the Corporation's incentive bonus arrangements.
</TABLE>
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As of December 31, 1994, the credit years of service for the
6 individuals named in the Summary Compensation Table are as
follows: Walter M. Vannoy, 1 year; Vincent A. Chiarucci, 7 years;
L. A. Harthun, 29 years; Steven L. Siemborski, 0 years; Charles
C. Rieger, Jr., 12 years; and Harry E. Figgie, Jr., 30 years.
Harry E. Figgie, Jr. is not accruing any additional benefits
under the SEBP since his resignation from the Corporation.
EMPLOYMENT AND SEVERANCE AGREEMENTS
The Corporation entered into an employment agreement dated
November 18, 1988 (the "Employment Agreement") with Harry
E. Figgie, Jr., the former Chairman of the Board and former Chief
Executive Officer of the Corporation. As noted above, Mr. Figgie
resigned from both of his positions on May 18, 1994. The
Employment Agreement, which was in effect during 1994, provided
for Mr. Figgie's employment through December 31, 1995, at an
annual base salary of at least $500,000. Mr. Figgie had the
option under certain circumstances of extending his employment
arrangement for an additional 3 years to December 31, 1998. In
addition to his base salary, Mr. Figgie was entitled to receive
both a discretionary bonus, which could not be less than 60% of
his base salary for the fiscal year to which such bonus relates,
and a formula-based bonus, and to participate in other benefit
plans provided by the Corporation. Pursuant to the terms of the
Employment Agreement, Mr. Figgie purchased 72,812 shares of
Class A Common Stock and 27,188 shares of Class B Common Stock
at a price of $1.00 per share pursuant to the 1988 Restricted
Stock Plan as a sign-on bonus. Those shares were forfeitable
under the terms of the 1988 Restricted Stock Plan until its
termination in December 1992. The Employment Agreement also
provided that the Corporation could terminate the employment
of Mr. Figgie for cause or upon his disability (as defined)
and that Mr. Figgie could terminate his employment for
good reason (as defined, including actions by the Corporation
resulting in a diminution of his position, authority, duties or
responsibilities). The Employment Agreement provided that if
Mr. Figgie elected to terminate his employment for good reason or
his employment was terminated by the Corporation other than for
cause, he would be entitled to receive an amount equal to (i) his
base salary, discretionary bonus and formula-based bonus for the
remaining term of the employment period, (ii) any unpaid bonuses
previously awarded for years prior to such termination year,
(iii) any other benefits provided under the Corporation's plans,
programs and practices, and (iv) those amounts otherwise payable
under his consulting arrangement (see discussion below).
Further, the Employment Agreement provided that in the event
Mr. Figgie's employment was terminated by the Corporation for
cause or by Mr. Figgie other than for good reason, or in the
event of his death or disability, Mr. Figgie (or his successor in
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interest) would be entitled to receive only his base salary
through the date of termination, any unpaid bonuses previously
awarded for years prior to such termination year and such other
benefits through the date of termination as may be available at
such time pursuant to the terms of governing Corporation plans,
programs and practices. The Employment Agreement provided that
upon completion of his term of employment under the Employment
Agreement (including any extension thereof to December 31, 1998),
Mr. Figgie would become a consultant to the Corporation under the
terms of the Employment Agreement for an additional three-year
period at 55% of his prior level of compensation. The
Corporation is discussing with Mr. Figgie the resolution of
various matters relating to the Employment Agreement.
The Corporation entered into an employment agreement dated
October 28, 1994 (the "Agreement") with Walter M. Vannoy. Mr.
Vannoy's Agreement provides for Mr. Vannoy's employment as Vice-
Chairman of the Board of Directors between February 16, 1994 and
May 18, 1994, as Chief Executive Officer from May 18, 1994 until
such time as a new Chief Executive Officer is duly elected and
takes office (the "New CEO Start Date"), and as Chairman of the
Board from May 18, 1994 until 90 days after the New CEO Start
Date. Mr. Vannoy's annual base salary under the Agreement is
$400,000. In addition to his base salary, Mr. Vannoy is entitled
to receive a discretionary bonus under the regular bonus programs
of the Corporation, to participate in other benefit plans
provided by the Corporation, and to be reimbursed for all
reasonable expenses incurred while performing his duties under
the Agreement. Pursuant to the Agreement, the 115,497 shares of
restricted stock granted to Mr. Vannoy under the 1993 Restricted
Stock Purchase Plan For Employees are subject to repurchase by
the Corporation upon termination of Mr. Vannoy's employment with
the Corporation as if he had retired. Further, the Agreement
provides that in the event Mr. Vannoy's employment is terminated
due to death or disability (as defined), by the Corporation
without good cause (as defined), or by Mr. Vannoy for good reason
(as defined), Mr. Vannoy (or his successor in interest) would be
entitled to a pro rata portion of any bonus payable to Mr. Vannoy
under the Agreement and the base salary that Mr. Vannoy would
have otherwise received: (i)if employment is terminated prior to
the 90th day following the New CEO Start Date, for the number of days
subsequent to his termination of employment which is equal to the
number of days between February 16, 1994 and his date of termination of
employment; or (ii)if terminated after the 90th day following the New
CEO Start Date, for the number of days between his date of
termination of employment and such date which represents the
number of days after the 90th day following the New CEO Start
Date as will equal the number of days between February 16, 1994
and the 90th day following the New CEO Start Date (the
"Separation Day"). The Agreement provides that upon completion
of his term of employment under the Agreement until the
Separation Day, Mr. Vannoy will continue to serve the Corporation
12 <PAGE>
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on a part-time basis with such title, if any, as the Board of
Directors deems appropriate.
The Corporation entered into an employment Agreement dated
July 1, 1994 (the "Employment Contract") with Steven L.
Siemborski. The Employment Contract provides for Mr.
Siemborski's employment as Senior Vice President and Chief
Financial Officer of the Corporation, at an annual base salary of
$350,000. In addition to his base salary, Mr. Siemborski is
entitled to receive: (i) a special $50,000 transition payment, an
incentive bonus of $25,000 for reducing financial consulting fees
by 50% during his first four months of employment (to be paid on
June 30, 1995) and an additional incentive bonus of $50,000 for
reducing such financial consulting fees to zero (0) by June 30,
1995 (to be paid on June 30, 1995) during the first year of the
Employment Contract; (ii) the greater of a bonus of $50,000 or
the bonus payable to him with respect to the 1995 calendar year
under the regular bonus programs of the Corporation during the
second year of the Employment Contract; and (iii) a discretionary
bonus under the regular bonus programs of the Corporation during
the third and fourth years of the Employment Contract. Mr.
Siemborski also received the right to purchase 150,000 shares of
Figgie's Common Stock, the class to be determined by the Stock
Option Committee, for one dollar ($1.00) per share in four annual
increments of 37,500 shares beginning July 1, 1994 (such rights
to expire if not exercised by Mr. Siemborski prior to the
following November 1st), to participate in other benefit plans
provided by the Corporation, and to be reimbursed for all
reasonable expenses incurred while performing his duties under
the Employment Contract. Further, the Employment Contract
provides that in the event Mr. Siemborski's employment is
terminated due to death or disability (as defined), Mr.
Siemborski (or his successor in interest) would be entitled to
the pro rata portion of any bonus which would have been payable
during the second, third and fourth years of the Employment
Contract and to his stock purchase rights under the Employment
Contract. The Employment Contract also provides that in the
event Mr. Siemborski's employment is terminated by the
Corporation without good cause (as defined) or by Mr. Siemborski
for good reason (as defined), Mr. Siemborski would be entitled to
his stock purchase rights under the Employment Contract and to
severance pay based upon the date of termination of his
employment as follows: (i) if employment is terminated during
the first year of the Employment Contract, a proportional amount
of $400,000 with respect to the year of his termination and
$400,000, $350,000 and $350,000 over the succeeding three years;
(ii) if employment is terminated during the second year of the
Employment Contract, a proportional amount of $400,000 with
respect to the year of his termination and $350,000 and $350,000
over the next succeeding two years; or (iii) if employment is
terminated during the third year of the Employment Contract, a
13 <PAGE>
<PAGE>
proportional amount of $350,000 with respect to the year of his
termination and $350,000 over the succeeding one year period.
In May 1989, all corporate officers and corporate level
department heads, other than Mr. Figgie, who reported to the
Chief Executive Officer of the Corporation, entered into
severance agreements (the "Severance Agreements") with the
Corporation which become effective in the event of a change of
control of the Corporation (as defined). The Severance
Agreements provide compensation in the event that within 3 years
of such change of control the executive is terminated other than
for cause (as defined) or such employment terminates because the
executive's duties, title, compensation, employee benefits or
place of employment are adversely changed. In addition, if the
executive terminates his employment during a period of 30 days
following the end of 6 months after a change of control, the
executive is entitled to severance compensation. Upon
termination of employment where severance compensation is payable
under the Severance Agreements, the executive is entitled to
receive a payment comprised of 2 times his highest annual base
salary, discretionary bonus and formula-based bonus awards
through the date of his termination of employment, together with
payments relating to the fair market value of any restricted
stock forfeited pursuant to the terms of the related restricted
stock purchase plan by such executive, all amounts payable which
had previously been deferred on such executive's behalf and
amounts provided under the Corporation's compensation or
retirement plans to the extent such executive participated in
such plan or plans at the time of such change of control. These
payments are subject to reduction to the extent necessary to keep
the aggregate amount of such severance compensation within the
limits imposed by Section 280G of the Internal Revenue Code.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Management Development & Compensation Committee of the
Board of Directors consists of Harrison Nesbit, II, Dale S.
Coenen, Fred J. Brinkman, Alfred V. Gangnes, John P. Reilly and
Walter M. Vannoy. During 1994, the same individuals other than
Mr. Reilly served on that Committee as well as Harry E. Figgie,
Jr., Dr. Harry E. Figgie, III and Russell W. McFall. Until his
retirement from the Corporation on May 18, 1994, Harry E. Figgie,
Jr. was the Chairman of the Board of the Corporation and its
Chief Executive Officer and the Chairman of the Board of The
Clark-Reliance Corporation. Dr. Figgie is the President of The
Clark-Reliance Corporation and, until March 15, 1994, was Vice
Chairman of Technology and Strategic Planning of the Corporation.
Mr. Coenen is a director of The Clark-Reliance Corporation.
14 <PAGE>
<PAGE>
The Stock Option Committee of the Board of Directors
currently consists of Dale S. Coenen, A.A. Sommer, Jr. and Fred
J. Brinkman. During 1994, the same individuals served on that
Committee.
On August 25, 1993, the Corporation made a loan to Harry
E. Figgie, Jr. to enable him to acquire restricted shares under
the Restricted Stock Plan. The loan was in the amount of
$156,450, was payable on demand and bore an interest rate equal
to the Bank of Boston's prime rate. The full amount of the loan
was repaid in April 1994.
Nancy Figgie, the wife of Harry E. Figgie, Jr., was Vice
President of Facilities Planning of the Corporation until her
resignation in February 1994; Matthew Figgie, the son of Harry
E. Figgie, Jr., was Director of Mergers and Acquisitions,
Currency Trading and Corporate Investments of the Corporation
prior to his resignation in May 1994; and Dr. Harry E. Figgie,
III was Vice Chairman and a Director of the Corporation until his
resignation from those positions in March and May 1994,
respectively. In 1994, Mrs. Figgie, Matthew Figgie and Dr.
Figgie collectively received from the Corporation $388,419.
As of October 30, 1991, the Corporation purchased $1,000,000
of 10% Convertible Subordinated Debentures due October 30, 2001
issued by Trans-Industries, Inc. The debentures provide for
prepayment without premium of $142,857 per year commencing in
1995 and the additional optional prepayments at declining
premiums over the same period. The debentures are convertible at
any time at the option of the Corporation into common stock of
Trans-Industries at $2.00 per share. Mr. Coenen is President,
Chairman of the Board and a shareholder of Trans-Industries and
Mr. Harry E. Figgie, Jr. is also a shareholder of
Trans-Industries. The common stock of Trans-Industries is
publicly traded in the over-the-counter market. The purchase was
approved by the Board of Directors with Mr. Figgie and Mr. Coenen
abstaining.
15 <PAGE>
<PAGE>
Item 12. Security Ownership of Certain Beneficial Owners and
Management
PRINCIPAL STOCKHOLDERS
The stockholders named in the following table are those
which are known to the Corporation to be the beneficial owners of
5% or more of the Corporation's Class A Common Stock or Class B
Common Stock. Unless otherwise indicated, the information is as
of December 31, 1994. For purposes of this table, and as used
elsewhere in this Form 10-K, the term "beneficial owner" means
any person who, directly or indirectly, has or shares the power
to vote, or to direct the voting of, a security or the power to
dispose, or to direct the disposition of, a security. Except as
otherwise indicated, the Corporation believes that each
individual owner listed below exercises sole voting and
dispositive power over his or its shares.
<TABLE>
<CAPTION>
Amount and
Nature of
Name and Address of Beneficial Percent
Title of Class Beneficial Owner Ownership of Class
<S> <C> <C> <C>
Class A Common Stock NewSouth Capital Management, Inc.
755 Crossover Lane, Suite 233
Memphis, Tennessee 38117 2,094,785(1) 15.3%
Class A Common Stock The Goldman Sachs Group, L.P.
85 Broad Street
New York, NY 10004 1,865,300(2) 13.6%
Class A Common Stock Wellington Management Company
75 State Street
Boston, MA 02109 803,000(3) 5.9%
Class A Common Stock First Pacific Advisors, Inc.
11400 West Olympic Boulevard, Suite 1200
Los Angeles, CA 90064 755,000(4) 5.5%
Class B Common Stock Harry E. Figgie, Jr.
37001 Shaker Boulevard
Hunting Valley, Ohio 44022 759,534(5) 16.1%
<FN>
(1) This amount, as reflected in a report on Schedule 13G dated June 3, 1994, consists of 2,007,785
shares as to which the reporting person claims sole voting power, 87,000 shares as to which the
reporting person claims shared voting power and 2,094,785 shares as to which the reporting person
claims sole dispositive power.
16 <PAGE>
<PAGE>
(2) This amount, as reflected in a report on Schedule 13G dated February 10, 1995, filed by The Goldman
Sachs Group, L.P., Goldman Sachs & Co. and Goldman Sachs Equity Portfolios, Inc. (on behalf of
Goldman Sachs Small Cap Equity Fund), as a group, consists of 1,865,300 shares as to which The
Goldman Sachs Group, L.P. and Goldman Sachs & Co. claim shared voting power and shared dispositive
power and 1,228,500 shares as to which Goldman Sachs Equity Portfolios, Inc. (on behalf of Goldman
Sachs Small Cap Equity Fund) claims shared voting power and shared dispositive power.
(3) This amount, as reflected in a report on Schedule 13G dated February 3, 1995, consists of 565,300
shares as to which the reporting person claims shared voting power and 803,000 shares as to which the
reporting person claims shared dispositive power.
(4) This amount, as reflected in a report on Schedule 13G dated February 13, 1995, consists of 755,000
shares as to which the reporting person claims shared voting power and shared dispositive power.
(5) For a description of Mr. Figgie's beneficial ownership, see the table under the caption "STOCK
OWNERSHIP OF DIRECTORS, EXECUTIVE OFFICERS AND A FORMER EXECUTIVE OFFICER" and footnotes (5), (10)
and (11) thereto.
</TABLE>
17 <PAGE>
<PAGE>
STOCK OWNERSHIP OF
DIRECTORS, EXECUTIVE OFFICERS
AND A FORMER EXECUTIVE OFFICER
The following table and notes thereto set forth information,
as of January 17, 1995, with respect to the beneficial ownership
of shares of Class A and Class B Common Stock by each Director,
each Executive Officer named in the Summary Compensation Table,
and Harry E. Figgie, Jr. (who resigned as Chief Executive
Officer, Chairman and Director of the Corporation on May 18,
1994) and, as a group, by the current Directors and Executive
Officers of the Corporation, based upon information furnished to
the Corporation by such persons.
<TABLE>
<CAPTION>
Amount of Beneficial
Ownership as of January 17,1995 (1)
Class A Percentage Class B Percentage
Name of Beneficial Owner Common Stock of Class Common Stock of Class
<S> <C> <C> <C> <C>
Fred J. Brinkman 500 * 3,000 *
Vincent A. Chiarucci 28,904(2) * 9,050(2) *
Dale S. Coenen 300 * 3,000 *
Alfred V. Gangnes 22,371(3) * 12,504(3) *
John S. Lanahan 358 * 6,536 *
F. Rush McKnight 1,315(4) * 6,503(4)(5) *
Harrison Nesbit, II 1,005(6) * 6,562(6) *
John P. Reilly 30,000 * 0 *
C.B. Robertson, III 2,500(7) * 9,000 *
Harold B. Scott 7,600(8) * 4,500 *
Steven L. Siemborski 37,866(2) * 324(2) *
A. A. Sommer, Jr. 2,250 * 7,750 *
Walter M. Vannoy 100,511(2) * 23,446(2) *
L. A. Harthun 19,390(2) * 6,319(2) *
Charles C. Rieger, Jr. 22,724(2) * 7,089(2) *
Harry E. Figgie, Jr.(9) 328,060(10) 2.4% 759,534(5)(11) 16.1%
All Current Directors and
Executive Officers as a
Group** (16 persons) 285,836(2) 2.1% 106,154(2) 2.2%
<FN>
* Less than 1%.
** Does not include the beneficial ownership of Messrs. Figgie and Chiarucci who are
not current Executive Officers of the Corporation.
18 <PAGE>
<PAGE>
(1) Except as otherwise indicated in footnotes (2), (3), (8) and (11), each Director, Executive Officer
or former Executive Officer owning shares listed or included in this table exercises sole voting and
dispositive power over such shares.
(2) These amounts include shares of Class A and Class B Common Stock held by the ESOP, the ESOP for
Salaried Employees and the Stock Bonus Plan which are subject to certain pass-through voting and
tendering rights. Participants in those plans are entitled to instruct the Trustee, on a
confidential basis, on how to vote and how to respond to a tender or exchange offer for shares
allocated to their accounts and on how to vote and how to respond to a tender or exchange offer for
certain of the unallocated shares. Under the trust agreement, as amended in November 1994, allocated
and unallocated shares for which no instructions are received can be voted or tendered by the
Trustee. 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 prior year's compensation (subject
to a maximum amount of compensation) bears to the prior year's compensation of all active
participants. The numbers of shares of Class A and Class B Common Stock held by the ESOP for
Salaried Employees, the ESOP and the Stock Bonus Plan which have been allocated to the named
Executive Officers and all current Executive Officers as a group, including the numbers of shares
expected to be allocated as of December 31, 1994, are as follows: (1) allocated shares in the ESOP
for Salaried Employees: Mr. Vannoy -- 195 shares of Class A Common Stock and 78 shares of Class B
Common Stock; Mr. Chiarucci -- 1,152 shares of Class A Common Stock and 547 shares of Class B Common
Stock; Mr. Harthun -- 1,355 shares of Class A Common Stock and 634 shares of Class B Common Stock;
Mr. Siemborski -- 120 shares of Class A Common Stock and 48 shares of Class B Common Stock;
Mr. Rieger -- 1,261 shares of Class A Common Stock and 590 shares of Class B Common Stock; and all
current Executive Officers as a group -- 3,152 shares of Class A Common Stock and 1,440 shares of
Class B Common Stock; (2) allocated shares in the ESOP: Mr. Vannoy -- 300 shares of Class B Common
Stock; Mr. Chiarucci -- 792 shares of Class B Common Stock; Mr. Harthun -- 1,003 shares of Class B
Common Stock; Mr. Siemborski -- 180 shares of Class B Common Stock; Mr. Rieger -- 892 shares of Class
B Common Stock; and all current Executive Officers as a group -- 2,692 shares of Class B Common
Stock; and (3) allocated shares in the Stock Bonus Plan: Mr. Chiarucci -- 16 shares of Class B Common
Stock; Mr. Harthun -- 4,517 shares of Class B Common Stock; Mr. Rieger -- 830 shares of Class B
Common Stock; and all current Executive Officers as a group -- 5,347 shares of Class B Common Stock.
The numbers of shares of Class A and Class B Common Stock held by the ESOP for Salaried Employees
which have not been allocated and are reflected in the table above as beneficially owned by the named
executive officers and all current Executive Officers as a group are as follows: Mr. Vannoy -- 422
shares of Class A Common Stock and 165 shares of Class B Common Stock; Mr. Chiarucci -- 422 shares of
Class A Common Stock and 165 shares of Class B Common Stock; Mr. Harthun -- 422 shares of Class A
Common Stock and 165 shares of Class B Common Stock; Mr. Siemborski -- 246 shares of Class A Common
Stock and 96 shares of Class B Common Stock; Mr. Rieger -- 422 shares of Class A Common Stock and 165
shares of Class B Common Stock; and all current Executive Officers as a group -- 1,933 shares of
Class A Common Stock and 758 shares of Class B Common Stock.
(3) Mr. Gangnes shares voting and dispositive power with respect to 22,371 shares of Class A Common Stock
and 12,504 shares of Class B Common Stock with his wife.
(4) These amounts do not include 575 shares of Class A Common Stock and 575 shares of Class B Common
Stock owned by Mr. McKnight's wife.
(5) These amounts do not include 47,493 shares of Class B Common Stock held in a trust established by
Mr. Figgie for a member of his immediate family. Mr. McKnight serves as 1 of 3 trustees of such
trust.
19 <PAGE>
<PAGE>
(6) These amounts do not include 2,405 shares of Class A Common Stock and 47 shares of Class B Common
Stock owned by Mr. Nesbit's wife.
(7) This amount does not include 2,500 shares of Class A Common Stock owned by Mr. Robertson's wife.
(8) This amount includes 3,600 shares of Class A Common Stock for which Mr. Scott has shared voting and
dispositive power as a co-trustee of a trust and 500 shares of Class A Common Stock for which
Mr. Scott has shared voting and dispositive power as the custodian of a custodial account for his
minor children.
(9) Harry E. Figgie, Jr. resigned from his positions as the Corporation's Chief Executive Officer and
Chairman of the Board as well as a member of the Board on May 18, 1994.
(10) The aggregate number of shares beneficially owned by Mr. Figgie excludes a total of 40,401 shares of
Class A Stock beneficially owned, or that may be deemed to be beneficially owned, by members of Mr.
Figgie's immediate family, certain Figgie family trusts and Clark-Reliance Corporation, an Ohio
corporation ("Clark-Reliance") of which Mr. Figgie was Chairman of the Board and Chief Executive
Officer until his resignation on October 19, 1994 and is presently Chairman Emeritus of the Board.
(As of December 28, 1994, Mr. Figgie owned 22.7% of the outstanding shares of common stock of Clark-
Reliance, Mr. Figgie's wife owned 22.7% of the outstanding shares of common stock of Clark-Reliance,
and each of Mr. Figgie's adult sons, Dr. Harry E. Figgie, III, Dr. Mark P. Figgie, and Matthew P.
Figgie, owned 18.2% of the outstanding shares of common stock of Clark-Reliance.) Of the excluded
shares: (i) 37,844 shares of Class A Common Stock are owned by Clark-Reliance; (ii) 2,499 shares of
Class A Common Stock are held in trust for Matthew P. Figgie, Mr. Figgie's son, for which Dr. Harry
E. Figgie, III, Mr. McKnight and Mr. David L. Carpenter act as trustees; and (iii) 58 shares of Class
A Common Stock are owned by Mr. Figgie's wife.
(11) This amount consists of 759,534 shares of Class B Common Stock as to which Mr. Figgie has sole voting
power, 749,534 shares of Class B Common Stock as to which Mr. Figgie has sole dispositive power, and
10,000 shares of Class B Common Stock as to which Mr. Figgie has shared dispositive power. Based upon
Mr. Figgie's Schedule 13D filed on January 6, 1995 (showing beneficial ownership information as
of December 19, 1994) and the January 1995 Form 4, the aggregate number of shares beneficially
owned by Mr. Figgie includes 13,537 shares of Class B Common Stock held in his account with the
Clark-Reliance Employee Profit Sharing and Savings and Trust Plan and excludes a total of 415,938
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, certain Figgie family
trusts and Clark-Reliance (see footnote 10 above). Of the excluded shares: (i) 134,564 shares of
Class B Common Stock are owned by Clark-Reliance; (ii) 57,881 shares (excluding those held in trust
as noted below) of Class B Common Stock are owned by Mr. Figgie's wife; (iii) 465 shares (excluding
those held in trust as noted below) of Class B Common Stock are owned by Matthew P. Figgie,
Mr. Figgie's son; (iv) 58,486 shares of Class B Common Stock are beneficially owned by Dr. Harry E.
Figgie, III, Mr. Figgie's son; (v) 58,189 shares (excluding those held in trust as noted below) of
Class B Common Stock are owned by Dr. Mark P. Figgie, Mr. Figgie's son; (vi) 2,112 shares of Class B
Common Stock are owned by The Figgie Family Foundation, of which Mr. Figgie is one of six trustees;
(vii) 51,750 shares of Class B Common Stock are held in trust for Mr. Figgie's wife; (viii) 47,493 shares
of Class B Common Stock are held in trust for Matthew P. Figgie, for which Dr. Harry E. Figgie, III,
Mr. McKnight and Mr. David L. Carpenter act as trustees; (ix) 2,499 shares of Class B Common Stock are
held in trust for Dr. Mark P. Figgie, for which National City Bank acts as trustee; and (x) 2,499 shares
of Class B Common Stock are held in trust for Matthew P. Figgie, for which National City Bank acts as trustee.
</TABLE>
20 <PAGE>
<PAGE>
Item 13. Certain Relationships and Related Transactions
CERTAIN TRANSACTIONS
Mr. McKnight, a member of the Board of Directors, is a
partner in the law firm of Calfee, Halter & Griswold which
performs legal services for the Corporation. For services
rendered during 1994, the Corporation paid Calfee, Halter &
Griswold $3,574,338.
Certain transactions or relationships relating to the
Corporation and Harry E. Figgie, Dr. Figgie and Mr. Coenen are
described under the caption "Compensation Committee Interlocks
and Insider Participation" in Item 11 and are incorporated by
reference.
21 <PAGE>
<PAGE>
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Company has duly caused this amendment to be signed
on its behalf by the undersigned, thereunto duly authorized.
FIGGIE INTERNATIONAL INC.
(Company)
Date: May 1, 1995 By: /s/ L. A. Harthun
L. A. Harthun
Senior Vice President, General
Counsel and Secretary
22 <PAGE>
