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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Definitive Proxy Statement
[X] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
FIGGIE INTERNATIONAL INC.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:*/
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*/ Set forth the amount on which the filing fee is calculated and state how it
was determined.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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FIGGIE INTERNATIONAL INC.
4420 SHERWIN ROAD
WILLOUGHBY, OHIO 44094
Supplement Mailed on September 27, 1995
to Proxy Statement Mailed on September 14, 1995
Dear Stockholder:
As you know, the Annual Meeting of Stockholders (the "Annual Meeting") of
Figgie International Inc. (the "Corporation") is to be held at Franklin Hall at
the Corporation's Headquarters, 4420 Sherwin Road, Willoughby, Ohio 44094 on
Tuesday, October 17, 1995, at 1:00 p.m., Eastern Daylight Savings Time. The
Corporation's Proxy Statement for the Annual Meeting was mailed to stockholders
on September 14, 1995.
This supplement mailed on September 27, 1995 describes various developments
since the date as of which information is set forth in the Proxy Statement for
the Annual Meeting and updates certain information included in the Proxy
Statement. Among other things, this supplement discusses the filing of an
amendment to a Schedule 13D by Harry E. Figgie, Jr. and certain other persons
and the settlement of the derivative actions noted in the Proxy Statement and
updates the identification of the members of certain committees of the Board of
Directors.
FIGGIE FAMILY GROUP. The tables on pages 3 and 5 and various footnotes on page
7 of the Proxy Statement reflect, among other things, the shares of Class A
Common Stock, par value $.10 per share (the "Class A Stock"), and Class B
Common Stock, par value $.10 per share (the "Class B Stock"), beneficially
owned by Mr. Harry E. Figgie, Jr. and other members of the Figgie family as of
September 1, 1995. This information is no longer accurate as of September 11,
1995.
The Corporation has received a copy of Amendment No. 3 to Mr. Figgie's
Schedule 13D as filed with the Securities and Exchange Commission on September
11, 1995 (the "Schedule 13D Amendment"). The Schedule 13D Amendment was filed
by Mr. Figgie, his wife and their three adult sons, the Figgie Family
Foundation and The Clark-Reliance Corporation, a corporation owned by the
Figgie family (collectively referred to herein as the "Figgie Family Group" and
in the Schedule 13D Amendment as the "Reporting Persons"), to report their
formation of a "group" for the purpose of disposing of their investment in the
Corporation. In addition, the Schedule 13D Amendment reports that the Figgie
Family Group has engaged Batchedler & Partners, Inc. to act as their financial
advisor with respect to their investment in the Corporation. (Batchedler &
Partners, Inc. and the Corporation are referred to in the Schedule 13D
Amendment as "Financial Advisor" and "Issuer," respectively.)
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The Schedule 13D Amendment states in part as follows:
With the advice and assistance of the Financial Advisor, the Reporting
Persons or their Financial Advisor intend to explore alternatives for
maximizing the value of the Issuer's shares for all shareholders and for
providing liquidity for their investment. The Reporting Persons and their
Financial Advisor intend to communicate with management and the Board of
Directors in order to influence their consideration of ways in which all
shareholders might benefit by maximizing the value of their investment in
the Issuer, including by pursuing transactions involving a merger of the
Issuer with another company or a sale of all or substantially all the assets
of the Issuer. The Reporting Persons or their Financial Advisor intend to
discuss with management of the Issuer the Reporting Persons' desire to
nominate one or more directors to the board who are committed to maximizing
shareholder value. The Reporting Persons do not currently intend to seek
control of the board, but reserve the right to seek control of the board if
it is necessary to do so to effect a transaction or transactions they
believe will maximize the value of the Securities.
None of the Reporting Persons has any intention of (i) becoming a
Director of the Issuer, (ii) acquiring control of the Issuer by means of
tender offer, merger or other combination, or (iii) seeking involvement in a
management or executive role with the Issuer. The Reporting Persons may
dispose of some or all of their positions in the Securities, depending on
the price of the shares, timing, and personal financial circumstances.
It is the practice of the Corporation to accept from time to time requests
for meetings from major stockholders, including representatives of the Figgie
Family Group.
Based upon the information in the Schedule 13D Amendment, the Board of
Directors of the Corporation has determined that Mr. Figgie and each of the
members of the Figgie Family Group should be regarded as "Substantial
Stockholders" of the Class B Stock as that term is used in Article Sixth of the
Corporation's Restated Certificate of Incorporation (the "Substantial
Stockholder Provision"). Accordingly, the voting power in Class B Stock of Mr.
Figgie and each of the other
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members of the Figgie Family Group will be reduced pursuant to the Substantial
Stockholder Provision.
As a result of the formation of the Figgie Family Group, for purposes of the
Substantial Stockholder Provision the beneficial ownership of Mr. Figgie and of
each of the persons who filed the Schedule 13D Amendment includes the aggregate
beneficial ownership of the entire Figgie Family Group. As of the September
11, 1995 filing date of the Schedule 13D Amendment, the members of the Figgie
Family Group reported beneficial ownership of an aggregate of 968,888 shares of
Class B Stock, or 20.50% of the Class B Stock, and 386,957 shares of Class A
Stock, or 2.84% of the Class A Stock.
In addition, the Schedule 13D Amendment states that, "[o]n September 8,
1995, Mr. Figgie arranged for the transfer of 150,000 shares of Class B Stock
to a trust for the benefit of Nancy F. Figgie for which the Wilmington Trust
Company acts as Trustee." The Wilmington Trust Company did not join in the
Schedule 13D Amendment by the Figgie Family Group, and the 150,000 shares of
Class B Stock which it is to hold in trust for Mrs. Figgie are apparently not
included in the 20.50% of Class B Stock reported for the Figgie Family Group in
the Schedule 13D Amendment. Nevertheless, since the record date for the Annual
Meeting was September 8, 1995, absent evidence to the contrary the beneficial
ownership of Mr. Figgie and of each of the other members of the Figgie Family
Group includes, for purposes of the Substantial Stockholder Provision, the
150,000 shares of Class B Stock over which Mr. Figgie has voting power in the
votes to be cast at the Annual Meeting, bringing the total beneficial ownership
of the Class B Stock of the Figgie Family Group for purposes of the Substantial
Stockholder Provision to 1,118,888 shares of Class B Stock, or 23.67% of the
Class B Stock.
As a result of the application of the Substantial Stockholder Provision, the
members of the Figgie Family Group are entitled to vote at the Annual Meeting
an aggregate of 947,276 shares of Class B Stock, or 20.82% of the Class B
Stock, rather than the 1,118,888 shares of Class B Stock, or 23.67% of the
Class B Stock, that the members of the Figgie Family Group beneficially own as
a group. Each record holder of shares beneficially owned by the Figgie Family
Group will be entitled to a proportionate number of votes equal to the number
of shares held of record by such person multiplied by a fraction the numerator
of which is 947,276 and the denominator of which is 1,118,888.
The reduced voting power of the Figgie Family Group reduces the aggregate
number of votes that the holders of shares of Class B Stock are entitled to
cast at the Annual Meeting from the 4,726,669 votes disclosed on page 2 of the
Proxy Statement, if there were no Substantial Stockholder, to 4,555,057 votes.
As
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a result, the total number of votes of both classes of the Corporation's stock
entitled to be cast at the Annual Meeting is 5,237,344, rather than the
5,408,956 votes disclosed on page 2 of the Proxy Statement. The holders of
record of shares entitled to cast a majority of the votes entitled to be cast
must be present in person or represented by proxy in order to constitute a
quorum for the holding of the Annual Meeting.
DERIVATIVE ACTIONS. The derivative actions filed in 1993 are noted on page
23 of the Proxy Statement. As of September 13, 1995, the settlement of the
derivative actions has become effective (the "Settlement").
As a part of the Settlement, the Corporation agreed to, among other things,
pay the plaintiffs certain incentive payments and the fees and disbursements of
their attorneys and restructure the Board of Directors, committees of the Board
and the cash compensation of non-management directors. The actions taken by
the Board of Directors described in the Proxy Statement to reduce the size of
the Board to nine members effective upon the date of the Annual Meeting, to
change the Board committee structure and to reduce the fees paid to
non-management directors are consistent with and implement the terms of the
Settlement.
In addition, as a part of the Settlement the Corporation reached a
settlement with Harry E. Figgie, Jr., his wife and their three adult sons,
including Harry E. Figgie III, and The Clark-Reliance Corporation (collectively
referred to herein as the "Figgie Interests") and the other director defendants
in the derivative actions. The Figgie Interests agreed to pay to the
Corporation $3.3 million, with interest from the date the settlement agreement
was executed. In addition, Harry E. Figgie, Jr. relinquished certain
substantial rights under his employment agreement referred to on page 28 of the
Proxy Statement, relinquished to the Corporation the right to determine whether
to keep one of the split-dollar life insurance policies for his benefit that
are reflected in the Summary Compensation Table on page 14 of the Proxy
Statement and agreed not to contest the Corporation's repurchase, for the
original purchase price of $1.00 per share, of 90% of the restricted shares he
purchased under the Corporation's 1993 Restricted Stock Purchase Plan.
Finally, the Figgie Interests assigned various rights to the Corporation,
agreed to assume certain obligations in dispute and executed a general release
in favor of the Corporation and others that included but was not limited to
claims related to the circumstances underlying the derivative actions. In
turn, the Corporation executed a general release in favor of the director
defendants and the Figgie Interests that included but was not limited to claims
related to the circumstances underlying the derivative actions and stated its
intent to take steps necessary to indemnify the director defendants, including
Harry E. Figgie, Jr. and Harry E. Figgie
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III, for expenses (including legal fees) incurred in connection with the
defense and settlement of the derivative actions. In this regard, through
September 22, 1995 the Corporation has advanced approximately $506,000 for
legal fees and expenses incurred by Harry E. Figgie, Jr. and Harry E. Figgie
III in connection with the derivative actions, subject to a determination to be
made in the future pursuant to the Corporation's Bylaws that indemnification is
proper under the circumstances.
BOARD COMMITTEE MEMBERSHIP. Page 21 of the Proxy Statement identifies the
persons expected to be the members of the committees of the Board of Directors
effective upon the date of the Annual Meeting. There have been certain changes
in the identity of the members of the Executive and Finance and Stock Option
Committees.
Effective upon the date of the Annual Meeting, the members of the Executive
and Finance Committee are expected to be as follows: W. Vannoy, Chairman; F.
Brinkman; J. Reilly; H. Nesbit, II; and S. Siemborski (ex-officio and
non-voting). Effective upon the date of the Annual Meeting, the members of the
Stock Option Committee are expected to be as follows: A. A. Sommer, Jr.,
Chairman; F. Brinkman; and H. Nesbit, II.
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE ANNUAL MEETING,
REGARDLESS OF THE NUMBER THAT YOU HOLD. PLEASE COMPLETE AND SIGN THE
PROXY/VOTING INSTRUCTION CARD ALREADY SENT TO YOU AND RETURN IT IN THE ENVELOPE
YOU RECEIVED PREVIOUSLY. IF YOU HAVE ALREADY SUBMITTED A SIGNED PROXY/VOTING
INSTRUCTION CARD AND WOULD LIKE TO SUBMIT A NEW PROXY/VOTING INSTRUCTION CARD,
YOU MAY OBTAIN A NEW PROXY/VOTING INSTRUCTION CARD BY CONTACTING:
IRA GAMM
MANAGER CORPORATE COMMUNICATIONS AND INVESTOR RELATIONS
FIGGIE INTERNATIONAL INC.
4420 SHERWIN ROAD
WILLOUGHBY, OHIO 44094
(216) 953-2812
By Order of the Board of Directors
L. A. Harthun
Secretary
Dated: September 27, 1995
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