FORM 10-K/A
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D C 20549
[X] Amended ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1993
Commission File Number 1-10244
WEIRTON STEEL CORPORATION
- - - -------------------------
(Exact name of Registrant as specified in its charter)
Delaware 06-1075442
- - - -------- ----------
(State or other jurisdiction (IRS employer identification #)
of incorporation or organization)
400 Three Springs Drive, Weirton, West Virginia 26062
- - - ---------------------------------------------- -----
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(304)-797-2000
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
- - - ------------------- -----------------------------------------
Common Stock, par New York Stock Exchange
value $.01 per share
Securities registered pursuant to Section 12(g) of the Act:
None
Indicate by checkmark 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 such filing requirements
for the past 90 days. Yes[X] No[ ]
Indicate by checkmark if disclosure of delinquent filers pursuant
to Item 405 of Regulation S-K is not contained herein, and will not
be contained, to the best of Registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part
III of this Form 10-K or any amendment to this Form 10-K. [X]
As of March 15, 1994, the aggregate market value of the voting
stock held by nonaffiliates of the Registrant was $309,062,878.
(The foregoing calculation includes shares allocated under the
Registrant's 1984 and 1989 Employee Stock Ownership Plans to the
accounts of employees who are not otherwise affiliates and
unallocated shares under the Registrant's 1989 Employee Stock
Ownership plan subject to voting instructions of employees who are
not otherwise affiliates.)
The number of shares of Common Stock ($.01 par value) of the
Registrant outstanding as of March 15, 1994 was 26,639,894.
WEIRTON STEEL CORPORATION
AMENDED FORM 10-K FOR YEAR ENDED 12/31/93
PART III.
Item 10. Directors and Executive Officers of the Registrant
Item 10 is hereby amended to add the following captions
and related text.
As provided by applicable law, the business and affairs
of the Company are managed by or under the direction of its Board
of Directors. The Board of Directors represents the interests of
the stockholders as a whole and has responsibility for the overall
performance of the Company.
The Company's Restated Certificate of Incorporation
provides for a Board of Directors of 13 members divided into three
classes, designated as Class I, Class II and Class III,
respectively. Each class serves a three-year term, and the terms
are staggered so that the term of one class expires at each year's
annual meeting of stockholders. At each annual meeting of
stockholders, a different class of directors is elected. The terms
of office of the Current Class I, Class II and Class III Directors
are set to expire at the annual meetings of stockholders in the
years 1994, 1995, and 1996, respectively.
The Restated Certificate of Incorporation also provides
for certain qualifications among the Company's 13 directors.
Specifically, at least three members of the Board of Directors (the
"Union Directors") must be designated by the Company's primary
recognized collective bargaining agent (the "Union"), currently the
Independent Steelworkers Union ("ISU"), provided the Union meets
certain requirements. One of the Union Directors must be the
president of the Union and the other two are designated by
certification of the executive committee of the Union. The
Restated Certificate of Incorporation further provides that three
members of the Board of Directors must consist of the Chief
Executive Officer of the Company and two of the Company's employees
designated by the Chief Executive Officer (the "Management
Directors"). The remaining seven directors (the "Independent
Directors") must not be, nor ever have been, employees of the
Company or its predecessor.
The Company has called a special meeting of stockholders
for May 26, 1994 to approve proposed amendments to its Restated
Certificate of Incorporation and By-laws which would, among other
things, increase the size of the Board of Directors to 14, create
a new category of ESOP Director, provide for the nomination of a
candidate for that position through the ESOPs, and change the
qualification requirements to serve as an Independent Director.
The following table sets forth the name, age (as of April
1, 1994) and principal occupation for at least the last five years
of each director of the Company.
Class I Directors
(Terms expiring in 1994)
Richard K. Riederer (1) Director in 1993
Age 50
Richard K. Riederer has been Vice President and Chief
Financial Officer of the Company since January 1989. From March
1986 to December 1988, he served as Vice President and Treasurer of
Harnischfeger Industries, Inc., a producer of manufacturing
equipment. Mr. Riederer was elected to the Board as a Director in
October 1993. Mr. Riederer is also a director of Portico Funds
Inc.
Phillip H. Smith (3) Director since 1983
Age 67
Phillip H. Smith has been a director of the Company since
1983. Mr. Smith is currently engaged in consulting engineering
business and governmental advisory activities. He is a former
Chief Executive Officer of Copperweld Corporation, a diversified
manufacturer of alloy steel, tubing, and bimetallic products. He is
a director of Information Display Technologies, Inc., and Mitech
Laboratories, Inc. He was formerly employed by both Inland Steel
Corporation and LaSalle Steel Company.
Harvey L. Sperry (3) Director since 1983
Age 63
Harvey L. Sperry has been a director of the Company since
1983. Mr. Sperry is a partner in the law firm of Willkie Farr &
Gallagher. He is a director of Kerr Group, Inc. and Hampshire
Group, Limited.
Thomas R. Sturges (3) Director since 1986
Age 49
Thomas R. Sturges has been a director of the Company
since 1986. Mr. Sturges is Executive Vice President of the
Harding Group, Inc., a private investment and management firm. he
was Special Associate Director in the Corporate Finance Department
of Bear, Stearns & Co. inc. from 1986 to February 1990.
Class II Directors
(Terms expiring in 1995)
Gordon C. Hurlbert (3) Director since 1983
Age 69
Gordon C. Hurlbert has been a director of the Company
since 1983. Mr. Hurlbert is President and Chief Executive Officer
of GCH Management Services, a business consulting firm. He is
Chairman of the Board of Directors of CSC Industries, Inc. He is
a director of Carolina Power & Light Co., Midwest Resources Inc.,
Urenco, Inc., and Kerr Group, Inc.
F. James Rechin (3)
Director since 1983
Age 70
F. James Rechin has been a director of the Company since
1983. Mr. Rechin is President and Chief Executive Officer of
Searchlight Corporation, a consulting firm. He is a former
Executive Vice President and a controlling stockholder of Brittany
Corporation, a manufacturing and holding company. He was also
formerly Group Vice President of TRW, Inc., a manufacturer of jet
engine parts.
Richard F. Schubert (3) Director since 1983
Age 57
Richard F. Schubert has been a director of the Company
since 1983. He is President and Chief Executive Officer of The
Points of Light Foundation. He is the Chairman of Biorelease,
Inc., a biotechnology firm, and the immediate past President of
American Red Cross. He is a director of National Allowance of
Business and Management Training Corp. and a former Vice-Chairman,
President and a director of Bethlehem Steel Corporation. He is
past Chairman of AISI Committee on International Trade and was
formerly Under Secretary of Labor.
David I.J. Wang (3) Director since 1992
Age 61
David I.J. Wang has been a director since 1992. Mr. Wang
was Executive Vice president--Timber Distribution & Specialty
Business from 1987 until his retirement in 1991 and was a member of
the International Paper Co. Board of Directors. He is a Director
of UGI Corp., Joy Technologies, Inc. and of several privately held
companies. He also serves on Advisory Boards of Georgia Institute
of Technology, the University of Texas and Hampton University.
Class III Directors
(Terms expiring in 1996)
James B. Bruhn (1) Director since 1990
Age 53
James B. Bruhn has been the Company's Vice President --
Tin Mill Products Business since November 1992. From July 1987
through November 1992, he served as Vice President--Sales and
Marketing--Tin Mill Products. He has been a director of the
Company since May 1990.
Robert J. D'Anniballe, Jr. (2) Director since 1990
Age 37
Robert J. D'Anniballe, Jr. has been a director of the
Company since 1990. He has been a partner in the law firm of
Alpert, D'Anniballe & Visnic since 1983 and General Counsel to the
ISU since 1985.
Herbert Elish (1) Director since 1983
Age 60
Herbert Elish has been Chairman of the Board of
Directors, President and Chief Executive Officer of the Company
since July 1987. He has been a director of the Company since 1983.
Mr. Elish also serves as a director of Hampshire Group, Limited.
Mark G. Glyptis (2) Director since 1991
Age 42
Mark G. Glyptis has been a director of the Company since
1991. He has been President of the ISU since August 1991 and was
employed by the Company in its Operations Services Department prior
to August 1991.
Phillip A. Karber (2) Director since 1992
Age 47
Phillip A. Karber has been a director of the Company
since 1992. He is currently Corporate Vice-President and Director
of the Center for Technology and Public Policy of BDM
International, Inc. He also serves on advisory boards at Texas A&M
and for the Center for Strategic and International Studies.
(1) Management Director
(2) Union Director
(3) Independent Director
Board of Directors and Committees
The Company's Board of Directors held seventeen meetings
during 1993. In addition, under the Company's By-Laws, the Board
of Directors has established several committees.
The Board's Audit Committee is currently composed of
Messrs. Karber (Chairman), Wang, Sturges, Glyptis, D'Anniballe, and
Elish (ex officio). The Audit Committee reviews, at least
annually, the services performed and to be performed by the
Company's independent accountants and the fees charged for their
services, and, in connection therewith, considers the effect of
those services on the independence of such accountants. The Audit
Committee discusses with the Company's independent accountants and
management the Company's accounting policies and reporting
practices followed, including the impact of alternative accounting
policies. The Audit Committee also reviews with the Company's
internal audit department the scope and results of internal
auditing procedures and the adequacy of accounting and financial
systems and internal controls. The Audit Committee may authorize
the Company's independent accountants to perform special
investigations or supplemental reviews as deemed desirable. The
Audit Committee held three meetings during 1993.
The Board's Compensation Committee is currently composed
of Messrs. Rechin (Chairman), Hurlbert, Sperry, and Elish (ex
officio). It is the policy of the Company that members of the
committee be "independent persons." An employee of the Company does
not qualify as a "independent person." (Mr. Elish, although an
employee, is required by the Company's By-Laws to be a member.)
The function of the Compensation Committee is to establish and
review policies and programs provided by the Company to its
officers and certain salaried employees. The Compensation
Committee also recommends to the Board of Directors compensation
policies and programs covering members of the Board and its various
committees, including the Compensation Committee. A report of the
Compensation Committee concerning its policies and their
application is set forth in this Report under Item 11, "Executive
Compensation". The Compensation Committee held five meetings in
1993.
The Company's By-Laws provide for a Nominating Committee
of the Board of Directors which is charged with identifying,
screening and recommending to the Board candidates to be nominated
as Independent Directors. The Nominating Committee comprises four
members: the President of the Union, the Company's chief executive
officer, or a director appointed by the chief executive officer,
and two Independent Directors designated by resolution of the
entire Board. Messrs. Herbert Elish, Mark G. Glyptis, Richard F.
Schubert, and Phillip H. Smith are the members of the Nominating
Committee. Suggestions for nominees for Independent Directors may
be made, not less than sixty (60) days prior to the Annual or
Special Meeting at which an election for directors is to occur, by
any stockholder in writing addressed to the Nominating Committee,
in care of the Secretary of the Company.
All directors who served during 1993 attended at least
75% of the aggregate of the regular and special Board of Directors
meetings and meetings of Board Committees occurring while they
served in 1993.
Directors who are not officers or employees of the
Company receive an annual retainer of $15,000, payable monthly, and
a meeting fee of $800 for each meeting of the Board of Directors
attended, together with a meeting fee of $700 for each meeting of
a committee of the Board of Directors attended. The Company also
reimburses ordinary and necessary out-of-pocket expenses incurred
by any director in connection with his services.
Deferred Compensation Plan for Directors
The Board of Directors adopted the Deferred Compensation
Plan for Directors effective as of January 1, 1991. All directors
who are not officers or other employees of the Company are eligible
to participate in the Deferred Compensation Plan. The Deferred
Compensation Plan, subject to the limitations of the Plan, permits
participants upon proper election in advance to defer part or all
of their directors' fees for a specified year. Amounts
representing Deferred Fees credited to the accounts of participants
are applied following each deferral year to the purchase of shares
of the Company's Common Stock on the same basis as the 1989
Employee Stock Purchase Plan. The shares are held in trust until
distributed to the respective participants in accordance with their
election.
Item 11. Executive Compensation
Item 11 is hereby amended to add the following captions
and related text.
The following table sets forth information for each of
the Company's last three fiscal years, summarizing the compensation
paid to (i) the Company's Chief Executive Officer (ii) each of the
Company's next four most highly compensated executive officers who
were serving as such at the end of the Company's last completed
fiscal year, and (iii) certain additional individuals for whom
disclosure would have been printed but for the fact that such
individuals were not serving as executive officers at the end of
the last completed fiscal year.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Annual Compensation
(a) (b) (c) (d) (e) (i)
Name & Principal Pos Year Salary Bonus(1) Other Annual All Other
Comp.(2)(3) Comp.(4)
<S> <C> <C> <C> <C> <C>
Herbert Elish 1993 $350,004 $205,236 $214,794
President & Chief 1992 350,000 146,923 198,500
Executive Officer 1991 350,000 143,058 188,607
Richard K. Riederer 1993 $191,256 $ 829
Vice President and 1992 150,000 $50,000 510
Chief Financial Off. 1991 150,000 353
James B. Bruhn 1993 $178,338 $ 773
Vice President 1992 162,000 412
Tin Mill Products 1991 162,000 385
Business
Warren E. Bartel* 1993 $153,340 $ 664
Executive Vice 1992 175,000 442
President 1991 175,000 413
William C.Brenneisen 1993 $143,001 $ 620
Vice President 1992 122,004 311
Human Resources 1991 122,004 287
Dennis R. Mangino 1993 $140,010 $ 607
Vice President 1992 130,020 330
Product Quality and 1991 130,020 308
Weirtec
<FN>
* Mr. Bartel resigned effective October 31, 1993.
(1) Mr. Riederer received two bonuses of $25,000 each in 1992
for services rendered in the years 1991 and 1992.
(2) In accordance with the rules of the Securities and
Exchange Commission, aggregate amounts of Other
Annual Compensation that are less than 10% of each of
the respective named executives combined salary
and bonuses, have been omitted.
(3) The terms of Mr. Elish's current and prior employment
agreements provide for certain annuity payments. The
Company has purchased annuity contracts, which vest
over time, to provide for these payments. As these
contracts vest, Mr. Elish incurs reportable taxable
income, without receiving a corresponding cash
payment, equal to the replacement value of the vested
contract (included in column i). Mr. Elish is also
entitled to receive payments equal to his incremental
income tax liability as a result of the vesting of
the annuities. In 1993, 1992, and 1991, Mr. Elish
received $168,926, $110,823, and $107,036,
respectively, related to such tax liabilities.
(4) Includes replacement value of annuity contracts which
vested pursuant to the terms of Mr. Elish's employment
agreement in the amounts of $213,772, $197,919, and
$188,082 for the years 1993, 1992, and 1991,
respectively. Other amounts reported represent
contributions on behalf of the named executive
officers pursuant to the terms of the 1989 Employee
Stock Ownership Plan.
</TABLE>
[TEXT]
The Company has made no award or payouts of long-term
compensation nor paid any other forms of compensation not covered
by the above table and required to be reported. As such, those
portions of the prescribed table have been omitted.
Stock Option Plan
The Company has adopted a Stock Option Plan (the "1987
Stock Option Plan") pursuant to the terms of which a committee
designated by the Board of Directors may grant stock options to
employees. Options for a total of 240,000 shares are outstanding
under the 1987 Stock Option Plan. No such options were awarded in
the year 1993, nor were any options exercised. All such options
have an exercise price of $8.33 per share and are exercisable.
<TABLE>
<CAPTION>
Aggregated Options Exercised in Last Fiscal Year
and Fiscal Year-End Option Values
(a) (b) (c) (d) (e)
Number of Value of Shares
Unexercised Unexercised
Options at In-the-money
Fiscal Year- Options at
End (#) Fiscal Year-
End ($)
- - - --------------------------------------------------------------------------
Name Shares Value Exercisable/ Exercisable/
Acquired on Realized Unexercisable Unexercisable
Exercise (#)
- - - -------------------------------------------------------------------------
<S> <C> <C> <C> <C>
H. Elish - - 150,000/-0- -
W.E. Bartel* - - 60,000/-0- -
R.K. Riederer - - 30,000/-0- -
<FN>
* Mr. Bartel resigned effective October 31, 1993; options remain
exercisable until October 31, 1994.
</TABLE>
[TEXT]
Employment Agreements with Certain Executives
Herbert Elish entered into an employment agreement with
the Company on July 1, 1990, amended August 5, 1993, (the
"Employment Agreement"), replacing a 1987 agreement (the "Prior
Agreement") which had provided for a five year term. The
Employment Agreement is for an indefinite term and can be
terminated by either party. The Employment Agreement provides for
termination by the Company for disability, for "just cause" (as
defined) and, upon two years' prior notice, without cause. The
employee may terminate employment upon 90 days prior notice without
further Company obligation or upon notice given within 180 days
after the election to the Board of Directors of a person not
nominated by the Board (except for Union Directors). In the event
of such latter termination, Mr. Elish would be entitled to receive
a cash amount equal to twice his base salary, payable in a single
lump sum within 30 days after such termination, vesting of the
deferred annuities described below, and delivery of certain
supplemental life insurance policies containing a waiver of premium
in event of employee's disability and to be continued in force for
employee's life following termination.
The Employment Agreement provides for a base salary of
$350,000 per year, plus incentive compensation equal to two-tenths
of 1% of the Company's annual net income (as defined) in excess of
$10 million, which formula is unchanged from the Prior Agreement.
Mr. Elish received no incentive compensation for 1993 services.
The Employment Agreement also provides for supplemental life
insurance benefits, supplemental retirement benefits in the form of
annuities (as hereinafter described), and for the immediate vesting
of annuities with respect to supplemental retirement benefits under
the Prior Agreement. The Prior Agreement provided, and the
Employment Agreement provides, for cash payments to Mr. Elish for
certain income tax liabilities incurred upon the vesting of the
annuities.
Pursuant to provisions which provide for supplemental
retirement benefits under the Employment Agreement, the Company
purchased five additional annuity contracts, which provide for
certain cash annuity payments, payable to Mr. Elish commencing at
age 62, for life, or if Mr. Elish does not survive for 20 years,
payable to his designated beneficiary for the remainder of such 20
year period, and thereafter to his surviving spouse, if any, for
her life. The Employment Agreement provides that the annuities
vest at the rate of one annuity contract on each of July 1,
beginning 1991 through 1995. All of the annuity contracts vest in
the event that Mr. Elish's employment is terminated, except for a
termination by the Company for just cause or by Mr. Elish other
than following the above described change in membership of the
Board of Directors, in which case those annuity contracts which
have not vested are forfeited. However, in the event a termination
occurs for just cause or by Mr. Elish other than following a Board
of Directors membership change after July 1, 1991, but prior to
July 2, 1995, forfeiture restrictions on the annuities lapse
ratably on the basis of 20% of their payable amount per year.
Richard K. Riederer, Vice-President and Chief Financial
Officer and a Director, has an employment agreement with the
Company providing a base salary of $205,000. Mr. Riederer
received no bonus in 1993 and received pursuant to his employment
agreement, a bonus of $25,000 for services rendered in 1992 and
1991. The agreement provides for bonuses in subsequent years in
amounts to be agreed upon. The agreement also provides for
supplemental disability income and supplemental life insurance.
The agreement may be terminated by the Company or by the employee.
However, if the Company terminates the agreement without cause, Mr.
Riederer will receive his base salary for 18 months, to be paid as
follows: 12 months base salary in one lump sum within 10 days
following date of termination and 6 months base salary to be paid
in 6 installments beginning in the 13th month following
termination. He is also entitled to medical, dental and insurance
benefits for a period of 24 months following such termination.
Messrs. Bruhn, Brenneisen, and Mangino have agreements
with the Company which require the Company to pay 18 months
compensation if such agreements are terminated by the Company
without cause as follows: 12 months in one lump sum payable within
10 days following termination and 6 months base salary in six
monthly installments beginning in the 13th month following
termination. Mr. Bruhn is also to be credited for 10 years of
service for pension purposes after five years of service and 20
years after 10 years of service.
Mr. Bartel resigned as Executive Vice President-
Operations and as a director of the Company effective October ,
1993. Prior to that time, he had an employment agreement with the
Company, which agreement terminated with such resignation.
PENSION PLAN
The Company maintains the Weirton Steel Corporation
Retirement Plan ("Retirement Plan"), a noncontributory defined
benefit pension plan which covers all employees who have completed
one year of service and attained age 21. The Retirement Plan meets
the funding requirements of the Employee Retirement Income Security
Act of 1974 ("ERISA"). Full vesting is obtained after five years
of pension service. The calculation of retirement benefits for
salaried employees is generally based upon length of service and
average annual pension compensation (as defined in the Retirement
Plan) for the highest five years of the 15 years preceding
retirement. Average annual pension compensation generally consists
of earnings (base salary or hourly wages and bonuses or profit
sharing payments), reduced by cost-of-living increases granted
prior to January 1, 1984, then increased by the greater of (i) 50%
of such cost-of-living increases, or (ii) amounts paid under the
Company's profit sharing plan. Prior to January 1, 1990, a
different method of calculation of average annual pension
compensation was employed for substantially all employees of the
Company which generally resulted in a higher average annual pension
compensation figure than the present method of calculation.
Participants in the Retirement Plan who were disadvantaged by the
change in calculation method are entitled to have their benefit
amount calculated by using a transition benefit formula which
generally results in greater average annual pension compensation.
Annual pension compensation for the purposes of the Retirement Plan
benefit amount calculations for 1993 for the named executives was
$235,840 for Mr. Elish, $203,557 for Mr. Riederer, $197,425 for Mr.
Bruhn, $135,111 for Mr. Mangino, and $144,829 for Mr. Brenneisen.
In certain circumstances, pension benefits are subject to
integration with social security benefits. As of December 31,
1993, Messrs. Elish, Riederer, Bruhn, Mangino, and Brenneisen had
credited service in the Retirement Plan of 6.4, 4.9, 6.5, 4.2, and
8.3 years, respectively.
The following table shows the estimated annual retirement
benefit payable beginning at normal retirement age, under the
Retirement Plan as in effect on January 1, 1994, on a straight life
annuity basis to salaried employees in the earnings and years of
service classifications indicated. For the year 1994, benefits
paid under the Plan cannot exceed the amount of $118,800 per annum.
<TABLE>
<CAPTION>
PENSION PLAN TABLE
Years of Service
Renumeration(1) 15 20 25 30 35
<S> <C> <C> <C> <C> <C>
$125,000 23,582 33,812 44,041 54,271 64,501
150,000 29,489 41,687 53,885 66,084 78,282
175,000 35,395 49,562 63,729 77,896 92,063
200,000 41,301 57,437 73,573 89,709 105,844
225,000 47,207 65,312 83,416 101,521 118,800
250,000 53,114 73,187 93,260 113,334 118,800
300,000 64,926 88,937 112,948 118,800 118,800
400,000 88,551 118,800 118,800 118,800 118,800
450,000 100,364 118,800 118,800 118,800 118,800
500,000 112,176 118,800 118,800 118,800 118,800
</TABLE>
[TEXT]
The highest benefit level is based on the maximum
pensionable earnings allowable (indexed for the cost-of-living)
under the Internal Revenue Code as applied to service after June
30, 1989. Pensionable earnings are defined in the Retirement Plan
as described above. Benefits accrued prior to July 1, 1989 are
preserved; however, none of the persons named in the Summary
Compensation Table had accrued a benefit amounts as of such
transition date exceeding the above retirement benefits. The
benefits payable from a qualified defined benefit plan are also
subject to Section 415 of the Internal Revenue Code which limits
the maximum annual retirement benefit payable at age 65 with
actuarial reduction for earlier commencement. This limitation is
indexed each year for inflation. In 1994, the maximum annual
retirement benefit is $118,800.
Report of Compensation Committee
The Compensation Committee of the Board of Directors
regularly reviews the Company's executive compensation program to
assure that it is both competitive and sensitive to individual and
Company performance. The Company has retained an executive
compensation consulting firm, which is available to the
Compensation Committee, to assist the Committee in establishing a
compensation program that is consistent with these objectives and
reflective of the Company's financial performance.
It has been the Company's practice to provide a
compensation program that is competitive. With respect to Mr.
Elish and the other named executives, this practice is accomplished
as follows:
*Annual base salaries of the named executives are reviewed by
the Compensation Committee periodically, taking into account the
following factors:
--Base salary levels of other executives with similar
responsibilities in companies of similar size, business
and complexity.
--Each executive's experience in his position at the
Company and his performance over a sustained
period of time.
The compensation consulting firm has advised the Compensation
Committee that the base salaries of the named executives are in the
lower range of competitive base salaries for 1993.
*It is the Company's policy to review base salaries
periodically to consider changes in the competitive marketplace,
assumption of additional responsibilities and individual
contributions. Such reviews usually result in salary increases.
Mr. Elish's base salary was last increased in 1990. The salaries
of each of the other named executives were increased during 1993.
*Mr.Elish, under the terms of his employment agreement,
receives incentive compensation equal to 2/10 of 1% of the
Company's annual net income (as defined) in excess of $10 million.
*The Company adopted the 1987 Stock Option Plan which provides
for granting options to purchase Common Stock at a price equal to
the market price of the Company's common stock on the date of
grant. Messrs. Elish, Bartel and Riederer were granted options
upon their commencement of employment with the company in 1987,
1988 and 1989, respectively. No other options have been granted
under the initial plan.
*The Company also maintains certain benefit programs in which
the named executives, as well as other salaried employees,
participate. These plans are detailed elsewhere in this Item. Mr.
Elish's participation in these plans is comparable to that of other
executives at his level in corporations of similar size.
Compensation Committee
F. James Rechin, Chairman
Gordon C. Hurlbert
Harvey L. Sperry
Herbert Elish, ex officio
Compensation Committee Interlocks and Insider Participation
During 1993, Mr. Elish served as Chairman of the Board of
Directors, President and Chief Executive Officer of the Company,
and is required by the Company's By-Laws to be an ex officio member
of the Compensation Committee. The Company retained the law firm
of which Mr. Sperry is a member to perform services for the Company
during 1993.
COMMON STOCK PERFORMANCE
The following chart compares, for each of the quarters
indicated, the percentage change in the Company's cumulative total
return on its Common Stock with the cumulative total return of (a)
the New York Stock Exchange Index, a broad equity market index, and
(b) an index consisting of the following steel companies: Armco,
Inc., Bethlehem Steel Corporation, Inland Steel Industries, Inc.,
and Wheeling-Pittsburgh Corporation. LTV Corporation was included
in the Company's peer group index in 1992, however, in 1993 LTV
Corporation was recapitalized following its emergence from
bankruptcy and as such, its performance data is no longer
comparable.
<TABLE>
<CAPTION>
Quarter Weirton Peer Group NYSE Index
- - - ------- ------- ---------- ----------
<S> <C> <C> <C>
6/30/89 100.00 100.00 100.00
9/29/89 97.52 92.68 99.59
12/29/89 96.12 96.89 109.64
3/30/90 70.64 87.41 107.40
6/29/90 65.92 72.77 113.90
9/28/90 50.29 55.70 98.75
12/31/90 49.64 59.93 107.14
3/28/91 41.37 54.90 121.69
6/28/91 40.45 60.67 120.81
9/30/91 29.42 60.24 129.39
12/31/91 25.74 57.67 138.69
3/31/92 39.53 60.48 133.73
6/30/92 44.13 66.94 136.25
9/30/92 31.26 51.56 139.04
12/31/92 27.58 65.21 145.65
3/31/93 48.74 69.34 152.79
6/30/93 64.35 77.58 154.46
9/30/93 55.16 66.83 160.90
12/31/93 46.89 82.38 165.88
3/31/94 67.11 75.90 159.17
</TABLE>
[TEXT]
Item 12. Security Ownership of Certain Beneficial Owners and
Management
Item 12 is hereby amended to read in its entirety as
follows:
The following table sets forth, as of March 31, 1994, the
only persons (including any group of persons) who, to the knowledge
of the Company, may be deemed to be the beneficial owner of more
than 5% of the Company's Common or Convertible Preferred Stock as
of that date. A beneficial owner of a security includes any person
who, directly or indirectly, through any contract, arrangement,
understanding, relationship or otherwise, has the power to vote or
direct the voting or who has investment power over the security,
which includes the power to dispose of or direct the disposition of
the security.
<TABLE>
<CAPTION>
Common Stock
Name and address of beneficial owner Amount Percent of class
<S> <C> <C>
United National Bank North 12,826,723(1) 48.0%
as Trustee under the 1984
ESOP
1501 Market Street
Wheeling, WV 26003
Wellington Management Co. 1,399,100(3) 5.3%
75 State Street
Boston, MA 02109
U.S. Trust Company of 5,870,968(4) 21.9%
California, N.A.
Suite 2700
555 S. Flower Street
Los Angeles, CA 90071
<CAPTION>
Convertible Preferred
Name and address of beneficial owner Amount Percent of class
<S> <C> <C>
United National Bank North 1,774,164(2) 98.6%
as Trustee under the 1989 ESOP
1501 Market Street
Wheeling, WV 26003
<FN>
(1) All shares have been allocated to the accounts of participants
in the 1984 ESOP consisting of approximately 9,622 employees and
former employees of the Company. Participants generally have full
voting and limited dispository power over securities allocated to
their accounts.
(2) Includes 801,063 shares allocated to the accounts of
participants in the 1989 ESOP consisting of approximately 8,361
employees and former employees of the Company. Participants
generally have full voting and limited dispository power over
securities allocated to their accounts.
(3) The Company has received a copy of a Schedule 13-G filed with
the Securities and Exchange Commission by Wellington Management Co.
indicating that, at December 31, 1993, Wellington Management Co.
had shared investment discretion over 1,399,100 shares of Common
Stock.
(4) According to Schedule 13-G filed by U.S. Trust Company of
California, N.A., at December 31, 1993, it held sole voting and
investment discretion over the reported shares, which are held in
a separate account in trust under the Company's qualified defined
benefit pension plan.
</TABLE>
[TEXT]
The following table sets forth, as of March 31, 1994, the
total number of shares of Common Stock owned beneficially by each
director, including those shares of Common Stock, if any, allocated
under the 1984 ESOP, and the percentage of outstanding Common Stock
represented thereby. The table also sets forth the number of
shares of Convertible Preferred Stock, if any, allocated under the
1989 ESOP through the latest allocation date (December 31, 1993),
and the percentage of outstanding convertible Preferred Stock
represented thereby. Unless otherwise indicated, and except for
shares allocated to the accounts of employees and directors under
the terms of the 1984 ESOP and 1989 ESOP, each beneficial owner has
full voting and investment power over the
shares shown in the table.
<TABLE>
<CAPTION>
Convertible
Common Stock Preferred Stock
Amount % of Class Amount % of Class
(1) (1)
<S> <C> <C> <C> <C>
James B. Bruhn 3,852 * 480 *
Robert D'Anniballe, - - - -
Jr.
Herbert Elish 155,513(3) * 643 *
Mark G. Glyptis 2,265 * 161 *
Gordon C. Hurlbert 22,995(5) * - -
Phillip A. Karber - - - -
F. James Rechin 12,110(5) * - -
Richard K. Riederer 32,275 * 503 *
Richard F. Schubert 300 * - -
Phillip H. Smith 13,000(5) * - -
Harvey L. Sperry 23,947(5) * - -
Thomas R. Sturges 14,999(5) * - -
David I.J. Wang 26,141(5) * - -
All directors and 324,400 1.2% 5,077 *
executives (4) as
a group(20 pers.)
<FN>
(1) An asterisk in this column indicates ownership of less than
1%.
(2) Includes 30,000 shares subject to options currently
exercisable.
(3) Includes 150,000 shares subject to options currently
exercisable and 100 shares held for Mr. Elish's daughter.
(4) Includes 180,000 shares subject to options currently
exercisable and 100 shares held by immediate family members of
Directors.
(5) Includes 22,995, 11,610, 23,647, 14,999, 7,682, and 16,141
shares credited to the accounts of Messrs. Hurlbert, Rechin,
Sperry, Sturges, Smith, and Wang, respectively, under the Deferred
Compensation Plan for Directors, over which shares the named
individuals do not exercise voting and/or investment power until
distribution.
</TABLE>
[TEXT]
Item 13. Certain Relationships and Related Transactions
Item 13 is hereby amended to read in its entirety as
follows:
Harvey L. Sperry, a director of the Company, is a partner
in the law firm of Willkie Farr & Gallagher, principal outside
legal counsel to the Company during 1993.
SIGNATURE
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THE
REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED THEREUNTO DULY AUTHORIZED.
WEIRTON STEEL CORPORATION
Registrant
By /s/ Richard K. Riederer
Richard K. Riederer
Vice-President and Chief Financial Officer
April 29, 1994
