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U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-KSB/A
AMENDMENT TO FORM 10-KSB
Filed Pursuant to
THE SECURITIES EXCHANGE ACT OF 1934
SERVOTRONICS, INC.
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(Exact name of registrant as specified in its charter)
AMENDMENT NO. 1
The undersigned registrant hereby amends the following items,
financial statements, exhibits or other portions of its Annual Report on Form
10-KSB for the year ended December 31, 1999 as set forth in the pages attached
hereto:
PART III
Item 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND
CONTROL PERSONS; COMPLIANCE WITH SECTION
16(a) OF THE EXCHANGE ACT.
Item 10. EXECUTIVE COMPENSATION.
Item 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT.
Item 12. CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS.
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this amendment to be signed on its behalf
by the undersigned, thereunto duly authorized.
SERVOTRONICS, INC.
Dated: May 1, 2000
By: /s/Lee D. Burns
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Lee D. Burns
Treasurer and Secretary
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SERVOTRONICS, INC.
AMENDMENT NO. 1
TO
FORM 10-KSB FOR YEAR ENDED
DECEMBER 31, 1999
Item 9. DIRECTORS, EXECUTIVE OFFICERS AND CONTROL PERSONS; COMPLIANCE WITH
SECTION 16(a) OF THE EXCHANGE ACT.
(a) DIRECTORS. The table below sets forth certain information
regarding the directors of Servotronics, Inc. (the "Company"), each of whom was
elected at the Company's 1999 Annual Meeting of Shareholders. The term of office
of each director is until the next Annual Meeting of Shareholders and until his
successor is elected and shall have qualified.
<TABLE>
<CAPTION>
Position with the Company
and Principal Occupation
and Business Experience
Name Age for Past Five Years
- ---- --- -------------------
<S> <C> <C>
Dr. William H. Duerig 78 Director of the Company
since 1990; Physicist and
Senior Program Manager
for Kearfott Guidance &
Navigation Corporation
for more than five years
prior to retirement in
1993.
Donald W. Hedges 78 Director of the Company
since 1967; self-employed
attorney since 1988.
</TABLE>
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<TABLE>
<CAPTION>
Position with the Company
and Principal Occupation
and Business Experience
Name Age for Past Five Years
- ---- --- -------------------
<S> <C> <C>
Nicholas D. Trbovich, Jr. 39 Director of the Company
since 1990; Vice
President of the Company
since 1990; Director of
Corporate Development of
the Company from 1987 to
1990.
Dr. Nicholas D. Trbovich 64 Chairman of the Board of
Directors, President and
Chief
Executive
Officer
of the
Company
since
1959.
</TABLE>
(b) EXECUTIVE OFFICERS. The following is a listing of the
Company's executive officers:
<TABLE>
<CAPTION>
Position with the Company
and Principal Occupation
and Business Experience
Name Age for Past Five Years
- ---- --- -------------------
<S> <C> <C>
Dr. Nicholas D. Trbovich 64 See table under
"Directors."
Nicholas D. Trbovich, Jr. 39 See table under
"Directors."
Raymond C. Zielinski 55 Vice President since
1990; Director of
Manufacturing of the
Company from 1983 to
1990.
Lee D. Burns 58 Treasurer and Secretary
of the Company since
1991; Controller and
Assistant Treasurer of
the Company from 1978 to
1991.
</TABLE>
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Nicholas D. Trbovich, Jr. is the son of Dr. Nicholas D.
Trbovich. There are no other family relationships between any of the directors
or executive officers of the Company.
Item 10. EXECUTIVE COMPENSATION.
DIRECTORS' FEES. Under the Company's standard compensation
arrangements with directors who are not employees, they are paid a yearly
director's fee of $10,000 plus a per meeting fee of $650 and reimbursement of
actual expenses for attendance at Board meetings. Directors who are also
employees do not receive the director's and/or meeting fees.
COMPENSATION TABLE. The following table shows the compensation
paid by the Company to each executive officer of the Company whose total salary
and bonus from the Company and its subsidiaries exceeded $100,000 during any of
the last three fiscal years.
ANNUAL COMPENSATION
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<TABLE>
<CAPTION>
Other
Annual All Other
Name and Compen- Compen-
Principal Position Year Salary Bonus(3) sation(1) sation(2),(4)
- ------------------ ---- ------ -------- --------- -------------
<S> <C> <C> <C> <C> <C>
Dr. Nicholas D. Trbovich 1999 $318,654 $50,000 $26,907 $14,437
Chairman, President and 1998 288,558 50,000 17,265 17,417
CEO 1997 290,529 45,000 28,027 34,380
Raymond C. Zielinski 1999 $108,942 $ 7,500 - $ 7,533
Vice President 1998 99,677 6,500 $ 7,846 10,275
1997 91,962 4,500 - 15,796
</TABLE>
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(1) Includes for Dr. Trbovich $25,000, $16,442 and $26,145 in 1999, 1998
and 1997, respectively, and $7,846 for Mr. Zielinski in 1998, for
untaken vacation pursuant to a policy that is generally applicable to
all employees of the Company; these amounts reflect accrued vacation
earned and expensed by the Company over several years and prior to when
the payment was received.
(2) All Other Compensation for 1999 includes (i) an allocation of 1,517.406
shares for Dr. Trbovich and 1,144.138 shares for Mr. Zielinski of
Common Stock of the Company under the Servotronics, Inc. Employee Stock
Ownership Plan valued as of November 30, 1999 (the date of the
allocation) at the closing price on the American Stock Exchange on that
date of $5-1/4 per share; and (ii) $6,470 for life insurance and health
care benefits for Dr. Trbovich and $1,526 for such benefits for Mr.
Zielinski, but excludes $91,876, the excess value of stock options
exercised by Dr. Nicholas D. Trbovich in 1999 over market price. Dr.
Trbovich received $195,000 by reason of the Company's withdrawal of
that amount from his pension-related deferred compensation account;
accruals to that account have been reported in previous filings. This
amount, as well as 8,784 Shares withheld by the Company from the total
Shares acquired on exercise, was applied to pay the expenses payable by
Dr. Trbovich as a result of the transaction. See table, "Aggregated
Option Exercises in Last Fiscal Year and Fiscal Year-End Option
Values", below.
3. The "Bonus" column of the compensation table above includes
discretionary incentive payments authorized by the Board of Directors
and paid in the year indicated in the table. Discretionary payments
authorized for 2000 will be included in the compensation table for 2000
to the extent they are paid in that year. The Board of Directors has
made no commitment for incentive payments in subsequent years.
4. No stock options or rights were awarded to either officer in 1999.
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Aggregated Option Exercises in Last Fiscal Year
and Fiscal Year-End Option Values
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<TABLE>
<CAPTION>
Number of
Securities
Underlying
Unexercised Value of
Options at Unexercised in-
Shares Fiscal Year- the-money
acquired End: Options at
on Realized Exercisable/ Fiscal Year-
Name of Officer Exercise Value Unexercisable End**
--------------- -------- ----- ------------- -----
<S> <C> <C> <C> <C>
Dr. Nicholas D. Trbovich 37,778* $91,876 37,800/0 -0-
Raymond C. Zielinski -0- - 11,524/0 -0-
</TABLE>
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* This number includes 8,784 Shares withheld by the Company and applied to
certain costs of the exercise transaction.
** None of the unexercised options held by the named individuals was
in-the-money at fiscal year-end.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE. Based
solely on its review of reports filed pursuant to Section 16(a) of the
Securities Exchange Act or representations from directors and executive officers
required to file such reports, the Company believes that all such filings
required of its officers and directors were timely made.
EMPLOYMENT AGREEMENT. Dr. Trbovich has an employment agreement
with the Company pursuant to which he is entitled to receive minimum direct
compensation of $325,000 per annum, or such greater amount as the Company's
Board of Directors may determine, and lifetime health and life insurance
benefits. In
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the event of Dr. Trbovich's death or total disability during the term of the
employment agreement, he or his estate is entitled to receive 50% of the
compensation he is receiving from the Company at the time of his death or
disability during the remainder of the term of the employment agreement. Also,
in the event of (i) a breach of the agreement by the Company, (ii) a change in
control of the Company, as defined, or (iii) a change in the responsibilities,
positions or geographic office location of Dr. Trbovich, he is entitled to
terminate the agreement and receive a payment of 2.99 times his average annual
compensation from the Company for the preceding five years. If this provision is
invoked by Dr. Trbovich and the Company makes the required payment, the Company
will be relieved of any further liability under the agreement notwithstanding
the number of years covered by the agreement prior to termination. In the event
the agreement is not extended by the Company beyond the scheduled expiration
date (September 30, 2004), as such date may be extended, Dr. Trbovich will be
entitled to a severance payment equal to nine months' salary and benefits.
Item 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.
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(a) SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS. The
following table lists the persons that owned beneficially, as of April 6, 2000,
more than 5% of the outstanding shares of Common Stock of the Company
("Shares"), based on the Company's records. Unless otherwise stated, each person
has sole voting and investment power with respect to the Shares indicated as
beneficially owned by that person.
<TABLE>
<CAPTION>
Name and Address of Amount and Nature of Percent of
Beneficial Owner Beneficial Ownership Class(1)
- ------------------- -------------------- --------
<S> <C> <C>
Servotronics, Inc. Employee
Stock Ownership Trust(2) 872,832(2) 36.3%
1110 Maple Street
P.O. Box 300
Elma, New York 14059
Dr. Nicholas D. Trbovich 324,107(3) 13.3%
1110 Maple Street
P.O. Box 300
Elma, New York 14059
Harvey Houtkin(4) 364,856(4) 15.2%
78 Lafayette Avenue
Suffern, New York 10901
</TABLE>
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(1) Percent of class is based upon 2,405,488 Shares outstanding as of April
6, 2000 plus, in the case of Dr. Trbovich, the Shares subject to his
stock option.
(2) The trustees of the Servotronics, Inc. Employee Stock Ownership
Trust--Nicholas D. Trbovich, Jr., Lee D. Burns and Raymond C.
Zielinski--direct the voting of unallocated Shares. The participants in
the related plan have the right to direct the voting of Shares which
have been allocated to their respective accounts; if a participant does
not direct the vote, the trustees may direct the vote of that
participant's Shares. As of April 6, 2000, approximately 311,567 Shares
have been allocated to the accounts of participants and approximately
561,265 Shares (23.3% of the Shares outstanding) remain unallocated.
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(3) This amount includes (i) 41,776 Shares held by a charitable foundation
for which Dr. Trbovich serves as a trustee; (ii) an option to acquire
37,800 Shares; (iii) approximately 36,584 Shares allocated to Dr.
Trbovich's account under the Servotronics, Inc. Employee Stock
Ownership Plan; and (iv) approximately 3,084 Shares beneficially owned
by certain of Dr. Trbovich's children (as to which Dr. Trbovich
disclaims beneficial interest). This amount does not include the Shares
beneficially owned by certain of Dr. Trbovich's other relatives.
(4) Based on a statement on Schedule 13D, as last amended on April 19,
1999, jointly filed by Mr. Houtkin, Rushmore Financial Services, Inc.
and All-Tech Investment Group, Inc. with the Securities and Exchange
Commission by Mr. Houtkin, Rushmore Financial Services, Inc. and
All-Tech Investment Group, Inc. According to Mr. Houtkin's statement,
he has sole voting and investment power with respect to 345,500 Shares
and shared voting and investment power with respect to 19,356 Shares
owned by the joint corporate filers or by Mr. Houtkin jointly with his
mother. Mr. Houtkin disclaims beneficial ownership in additional shares
owned by other members of his family.
(b) SECURITY OWNERSHIP OF MANAGEMENT. The following table sets
forth, as of April 6, 2000, information as to the beneficial ownership of Shares
of the Company held by each director and by all directors and officers as a
group (each individual listed in the following table has sole voting and
investment power with respect to the Shares indicated as beneficially owned by
that person, except as otherwise indicated):
<TABLE>
<CAPTION>
Name of Amount and Nature of Percent of
Beneficial Owner Beneficial Ownership Class(1)
- ---------------- -------------------- --------
<S> <C> <C>
Dr. Nicholas D. Trbovich 324,107(2) 13.3%
Nicholas D. Trbovich, Jr. 52,509(3) 2.2
Donald W. Hedges 22,336(4) 0.9
</TABLE>
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<TABLE>
<S> <C> <C>
Dr. William H. Duerig 16,193(5) 0.7
All directors and
executive officers
as a group 1,034,025(6)(7) 40.9%
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</TABLE>
(1) Percent of class is based upon 2,405,488 Shares outstanding as of April
6, 2000 plus the number of Shares subject to stock options held by the
indicated person or group.
(2) See note (3) to the table in "Security Ownership of Certain Beneficial
Owners."
(3) This amount includes 36,717 Shares which Mr. Trbovich, Jr. has the
right to acquire under stock options and approximately 15,790 Shares
allocated to Mr. Trbovich, Jr.'s account under the Servotronics, Inc.
Employee Stock Ownership Plan. Does not include Shares held by the
Servotronics, Inc. Employee Stock Ownership Trust (the "ESOT") as to
which Mr. Trbovich, Jr. serves as one of three trustees. See note (6)
below and the table in "Security Ownership of Certain Beneficial
Owners."
(4) This amount includes 12,600 Shares which Mr. Hedges has the right to
acquire under a stock option. Mr. Hedges has sole voting and investment
power with respect to 9,261 Shares and shared voting and investment
power with respect to 475 Shares.
(5) This amount includes 12,600 Shares which Dr. Duerig has the right to
acquire under a stock option. Dr. Duerig has sole voting with respect
to 3,593 Shares.
(6) Includes unallocated Shares held by the ESOT over which certain
officers, as trustees of the ESOT, may be deemed to have voting power,
as well as Shares allocated to the accounts of all officers as a group
under the related plan. See the table in "Security Ownership of Certain
Beneficial Owners" and note (2) thereto.
(7) See notes (2) through (5) above.
Item 12. Certain Relationships and Related Transactions.
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During 1999, certain of Dr. Trbovich's sons were employed by
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the Company and received, in the aggregate, $122,975 in compensation from the
Company. See, also, the discussion under "Employment Agreement" in Item 10.
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