SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the fiscal year ended December 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
COMMISSION FILE NUMBER 1-4821
PITTWAY CORPORATION
BLUE CHIP PROFIT SHARING AND SAVINGS PLAN
(Full title of the Plan)
PITTWAY CORPORATION
(Name of Issuer of the Securities Held Pursuant to the Plan)
200 S. Wacker Drive, Suite 700
Chicago, Illinois 60606-5802
(Address of Issuer's Principal Executive Office)
<PAGE>
REQUIRED INFORMATION
Page
(a) Financial Statements - financial statements 3-17
required to be filed are listed in the
Index to Financial Statements attached hereto,
which is incorporated herein by reference.
(b) Signatures 18
(c) Exhibit:
Number Description
23 Consent of Independent Accountants 19
2
<PAGE>
PITTWAY CORPORATION
BLUE CHIP PROFIT SHARING
AND SAVINGS PLAN
FINANCIAL STATEMENTS
DECEMBER 31, 1998 and 1997
3
<PAGE>
PITTWAY CORPORATION
BLUE CHIP PROFIT SHARING AND SAVINGS PLAN
INDEX TO FINANCIAL STATEMENTS
Title Page
Report of independent accountants 5
Financial Statements:
Statement of Net Assets Available for Benefits
(with Fund Information) at December 31, 1998 6
Statement of Net Assets Available for Benefits
(with Fund Information) at December 31, 1997 7
Statement of Changes in Net Assets Available
for Benefits (with Fund Information) for the year
ended December 31, 1998 8
Statements of Changes in Net Assets Available
for Benefits (with Fund Information) for the year
ended December 31, 1997 9
Notes to Financial Statements 10-15
Supplemental schedules:
Item 27a - Schedule of Assets held for Investment
Purposes at December 31, 1998 16
Item 27d - Schedule of Reportable Transactions
for the year ended December 31, 1998 17
Note: All other schedules of additional financial
information required by section 2520.103-10
of Department of Labor Rules and Regulations
for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974 (ERISA)
have been omitted because they are not applicable.
4
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Participants and the
Administrative Committee of the
Pittway Corporation Blue Chip
Profit Sharing and Savings Plan
In our opinion, the accompanying statements of net assets available for
benefits and the related statements of changes in net assets available
for benefits present fairly, in all material respects, the net assets
available for benefits of the Pittway Corporation Blue Chip Profit
Sharing and Savings Plan at December 31, 1998 and 1997, and the changes in
net ssets available for benefits for the years then ended, in conformity
with generally accepted accounting principles. These financial statements
are the responsibility of the Plan's Administrative Committee; our
responsibility is to express an opinion on these financial statements
based on our audits. We conducted our audits of these statements in
accordance with generally accepted auditing standards which require
that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis
for the opinion expressed above.
Our audits were performed for the purpose of forming an opinion on the
basic financial statements taken as a whole. The supplemental schedules
of Assets Held for Investment Purposes and of Reportable Transactions
are presented for the purpose of additional analysis and are not a
required part of the basic financial statements but are supplementary
information required by the Department of Labor's Rules and Regulations
for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. The fund information in the statements of net
assets available for benefits and the statements of changes in net
assets available for benefits is presented for purposes of additional
analysis rather than to present the net assets available for plan
benefits and the changes in net assets available for benefits of each
fund. These supplemental schedules and fund information are the
responsibility of the Plan's Administrative Committee. The supplemental
schedules and fund information have been subjected to the auditing
procedures applied in the audits of the basic financial statements and,
in our opinion, are fairly stated in all material respects, in relation
to the basic financial statements taken as a whole.
/s/ PricewaterhouseCoopers LLP
Chicago, Illinois
June 17, 1999
5
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<TABLE>
PITTWAY CORPORATION
BLUE CHIP PROFIT SHARING AND SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS (WITH FUND INFORMATION)
AT DECEMBER 31, 1998
<CAPTIONS>
Fidelity Fidelity Fidelity Fidelity Fidelity
Diversified Fidelity Growth & Market Emerging Money
International Magellan Income Index Growth Market
Fund Fund Fund Fund Fund Fund
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments $1,480,458 $27,129,999 $20,329,802 $ 2,679,645 $3,178,268 $ 8,710,071
Participant loans - - - - - -
Dividends and interest
receivable - - - - - -
Net assets available
for benefits $1,480,458 $27,129,999 $20,329,802 $ 2,679,645 $3,178,268 $ 8,710,071
Fidelity Penton
Managed AptarGroup Media Pittway
Income Stock Stock Stock Participant
Fund Fund Fund Fund Loans Total
ASSETS
Investments $2,879,681 $ 2,387,482 $ 6,932,963 $28,550,901 - $104,259,270
Participant loans - - - - $3,224,243 3,224,243
Dividends and interest
receivable - - 10,354 25,685 - 36,039
Net assets available
for benefits $2,879,681 $ 2,387,482 $ 6,943,317 $28,576,586 $3,224,243 $107,519,552
The accompanying notes are an integral part of this statement.
6
</TABLE>
<PAGE>
<TABLE>
PITTWAY CORPORATION
BLUE CHIP PROFIT SHARING AND SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS (WITH FUND INFORMATION)
AT DECEMBER 31, 1997
<CAPTIONS>
Fidelity Fidelity Fidelity Fidelity Fidelity
Diversified Fidelity Growth & Market Emerging Money
International Magellan Income Index Growth Market
Fund Fund Fund Fund Fund Fund
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Investments $1,990,946 $33,580,413 $25,433,574 $2,289,081 $ 2,671,536 $17,464,277
Participant loans - - - - - -
Dividends receivable - - - - - -
Contributions receivable:
From participating employees 1,020 9,920 8,346 1,366 1,783 5,311
From employer 340 3,637 2,895 486 584 1,601
Net assets available
for benefits $1,992,306 $33,593,970 $25,444,815 $2,290,933 $ 2,673,903 $17,471,189
Fidelity
Managed AptarGroup Pittway
Income Stock Stock Participant
Fund Fund Fund Loans Total
ASSETS
Investments $3,817,319 $ 2,984,156 $37,734,016 - $127,965,318
Participant loans - - - $3,603,723 3,603,723
Dividends receivable - - 49,863 - 49,863
Contribution receivable:
From participating employees 1,624 - 8,566 - 37,936
From employer 568 - 3,158 - 13,269
Net assets available
for benefits $3,819,511 $ 2,984,156 $37,795,603 $3,603,723 $131,670,109
The accompanying notes are an integral part of this statement.
7
</TABLE>
<PAGE>
<TABLE>
PITTWAY CORPORATION
BLUE CHIP PROFIT SHARING AND SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (WITH FUND INFORMATION)
FOR THE YEAR ENDED DECEMBER 31, 1998
<CAPTIONS>
Fidelity Fidelity Fidelity Fidelity Fidelity
Diversified Fidelity Growth & Market Emerging Money
International Magellan Income Index Growth Market
Fund Fund Fund Fund Fund Fund
<S> <C> <C> <C> <C> <C> <C>
Contributions:
From participating employees $ 356,721 $ 2,955,015 $ 2,828,500 $ 621,468 $ 774,011 $ 1,369,516
From employer 97,890 862,708 746,947 150,314 167,415 521,901
454,611 3,817,723 3,575,447 771,782 941,426 1,891,417
Income from investments:
Dividends and interest 55,676 1,620,858 1,125,477 99,337 193,499 740,201
Net appreciation
(depreciation) in market
value of investments 80,849 4,913,870 3,181,311 371,877 601,690 -
Benefits paid to participants (108,060) (1,885,993) (1,372,170) (173,672) (73,024) (1,736,925)
Transfers between funds, net 82,380 (1,934,192) (1,112,103) 489,499 411,787 (1,321,529)
Transfers to other plans, net (1,077,304) (12,996,237)(10,512,975) (1,170,111)(1,571,013) (8,334,282)
Net increase (decrease) in
net assets available for
benefits for the period (511,848) (6,463,971) (5,115,013) 388,712 504,365 (8,761,118)
Net assets available for
benefits, beginning of
the period 1,992,306 33,593,970 25,444,815 2,290,933 2,673,903 17,471,189
Net assets available for
benefits, end of the
period $1,480,458 $27,129,999 $20,329,802 $ 2,679,645 $3,178,268 $ 8,710,071
Fidelity Penton
Managed AptarGroup Media Pittway
Income Stock Stock Stock Participant
Fund Fund Fund Fund Loans Total
Contributions:
From participating employees $ 486,974 - - $ 2,942,904 - $ 12,335,109
From employer 137,143 $ (272)$ (2,139) 919,695 - 3,601,602
624,117 (272) (2,139) 3,862,599 - 15,936,711
Income from investments:
Dividends and interest 215,504 16,084 21,459 144,495 $ 278,210 4,510,800
Net appreciation
(depreciation) in market
value of investments - 30,981 521,413 2,611,700 - 12,313,691
Benefits paid to participants (474,780) (68,620) (58,508) (1,555,299) (247,057) (7,754,108)
Transfers between funds, net 214,586 (62,076) 8,983,129 (6,673,698) 922,217 -
Transfers to other plans, net (1,519,257) (512,771) (2,522,037) (7,608,814)(1,332,850) (49,157,651)
Net increase (decrease) in
net assets available for
benefits for the period (939,830) (596,674) 6,943,317 (9,219,017) (379,480) (24,150,557)
Net assets available for
benefits, beginning of
the period 3,819,511 2,984,156 - 37,795,603 3,603,723 131,670,109
Net assets available for
benefits, end of the
period $2,879,681 $ 2,387,482 $ 6,943,317 $28,576,586 $3,224,243 $107,519,552
The accompanying notes are an integral part of this statement.
8
</TABLE>
<PAGE>
<TABLE>
PITTWAY CORPORATION
BLUE CHIP PROFIT SHARING AND SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (WITH FUND INFORMATION)
FOR THE YEAR ENDED DECEMBER 31, 1997
<CAPTIONS>
Fidelity Fidelity Fidelity Fidelity Fidelity
Diversified Fidelity Growth & Market Emerging Money
International Magellan Income Index Growth Market
Fund Fund Fund Fund Fund Fund
<S> <C> <C> <C> <C> <C> <C>
Contributions:
From participating employees $ 328,620 $ 2,594,655 $ 2,408,080 $ 339,914 $ 534,411 $ 1,516,042
From employer 82,107 881,982 710,632 86,389 126,039 529,659
410,727 3,476,637 3,118,712 426,303 660,450 2,045,701
Income from investments:
Dividends and interest 71,443 2,145,907 1,145,327 60,292 524,335 886,325
Net appreciation
(depreciation) in market
value of investments 160,196 4,874,044 4,619,774 318,609 (186,466) -
Benefits paid to participants (138,373) (1,424,742) (1,174,685) (124,716) (20,527) (1,488,160)
Transfers between funds, net 404,513 (2,393,909) 10,979 1,013,426 332,688 (352,148)
Net increase in net assets
available for benefits for
the period 908,506 6,677,937 7,720,107 1,693,914 1,310,480 1,091,718
Net assets available for
benefits, beginning of
the period 1,083,800 26,916,033 17,724,708 597,019 1,363,423 16,379,471
Net assets available for
benefits, end of the
period $1,992,306 $33,593,970 $25,444,815 $2,290,933 $ 2,673,903 $17,471,189
Fidelity
Managed AptarGroup Pittway
Income Stock Stock Participant
Fund Fund Fund Loans Total
Contributions:
From participating employees $ 452,397 - $ 2,451,886 - $ 10,626,005
From employer 143,521 - 786,292 - 3,346,621
595,918 - 3,238,178 - 13,972,626
Income from investments:
Dividends and interest 227,318 $ 16,483 175,870 $ 210,330 5,463,630
Net appreciation
(depreciation) in market
value of investments - 1,117,088 8,369,782 - 19,273,027
Benefits paid to participants (315,703) (75,537) (1,679,782) (136,359) (6,578,584)
Transfers between funds, net (401,782) (47,374) 201,128 1,232,479 -
Net increase (decrease) in
net assets available for
benefits for the period 105,751 1,010,660 10,305,176 1,306,450 32,130,699
Net assets available for
benefits, beginning of
the period 3,713,760 1,973,496 27,490,427 2,297,273 99,539,410
Net assets available for
benefits, end of the
period $3,819,511 $ 2,984,156 $37,795,603 $3,603,723 $131,670,109
The accompanying notes are an integral part of this statement.
9
</TABLE>
<PAGE>
PITTWAY CORPORATION
BLUE CHIP PROFIT SHARING AND SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - DESCRIPTION OF THE PLAN:
The Pittway Corporation Blue Chip Profit Sharing and Savings Plan (the
"Plan") covers eligible full-time employees of Pittway Corporation and
certain of its subsidiaries (the "Company" or the "Employer"). The Plan is
administered by a committee appointed by the Company.
Prior to January 1, 1999, an employee became eligible to participate on the
first day of the first calendar quarter after the completion of one year of
service. Beginning in January, 1999, an employee becomes eligible to
participate in the plan upon completion of thirty days of service with an
entry date on the first day of the next calendar quarter thereafter.
Employees will automatically be enrolled in the plan upon their first
eligible Entry Date at a contribution rate of 3 percent. These
contributions will automatically be invested in the Fidelity Retirement
Government Money Market Fund. Employees not interested in participating in
the plan must decline the automatic enrollment.
Before automatic enrollment was adopted in January, 1999, participation in
the Plan was elected by employees. Employees may change the election
percentage or investment options. The plan allows employees to contribute
between 1 and 15 percent of the employee's pretax earnings (subject to
Internal Revenue Service limitations) among the investment options offered
by the plan. Participants' earnings are generally defined as total
compensation for services rendered to a participating Employer.
Participants may elect to suspend their contributions at any time.
Eligible employees will not share in any Employer contributions for any
period in which they voluntarily suspend their contributions or do not
participate in the Plan. Active participation can be elected again on the
next regular enrollment date.
The amount of Employer contributions is determined annually for each
separate participating Employer. Such contributions are computed as a
matching percentage of each participant's contribution within specified
limits.
The investment funds available to participants are the Fidelity Diversified
International Fund, the Fidelity Magellan Fund, the Fidelity Growth and
Income Fund, the Fidelity Spartan Market Index Fund, the Fidelity Emerging
Growth Fund, the Fidelity Retirement Government Money Market Fund, the
Fidelity Managed Income Fund and the Pittway Stock Fund. In August, 1998,
the Penton Media Stock Fund was established when the Company spun off
its Penton Media Group into a separate company called Penton Media, Inc.
and distributed one share of Penton Media, Inc. common stock for each share
of Pittway Class A Stock held. In April 1993, the AptarGroup Stock Fund was
established when the Company spun off its Seaquist Group into a separate
10
<PAGE>
company called AptarGroup, Inc. and distributed one share of AptarGroup,
Inc. common stock for each share of Pittway Class A Stock held. Any
dividends paid on either the AptarGroup Stock Fund or the Penton Media
Stock Fund are transferred and reinvested in the Pittway Stock Fund.
A participant may elect to transfer certain portions of his or her account
in the Plan from one fund to another up to twelve times per year subject to
certain restrictions.
Each participant is fully vested in his or her contributions at all times.
Vesting of the Employer contribution occurs at the rate of 20 percent per
year on a cumulative basis for each year of service with a participating
Employer. Forfeitures of nonvested amounts occur when a participant
terminates employment for any reason other than retirement after age 65,
death, or disability. Upon withdrawal from the Plan, the participant will
receive the amount of his or her contributions plus the vested portion of
his or her Employer contributions. Forfeited amounts are used to reduce
future contributions of the Employer. Such forfeitures totaled $90,972 and
$97,400 in 1998 and 1997 respectively.
Fidelity Management Trust Company is the trustee of the plan investments in
the Fidelity Diversified International Fund, Fidelity Magellan Fund,
Fidelity Growth and Income Fund, Fidelity Spartan Market Index Fund,
Fidelity Emerging Growth Fund, Fidelity Retirement Government Money Market
Fund, and the Fidelity Managed Income Fund. The Northern Trust Company is
the trustee of the plan investments in the AptarGroup Stock Fund, the
Penton Media Stock Fund, and the Pittway Stock Fund.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Basis of accounting
The financial statements of the Plan have been prepared on the accrual
basis of accounting.
Use of estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements
and accompanying notes. Actual results could differ from these estimates.
Investments
The AptarGroup Stock Fund, Penton Media Stock Fund, and Pittway Stock Fund
invest in shares of AptarGroup, Inc. common stock, Penton Media, Inc.
common stock and Pittway Corporation Class A stock, respectively. The
Fidelity Diversified International Fund is a mutual fund which invests
primarily in foreign stocks that are included in the Morgan & Stanley EAFE
11
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Index. The Fidelity Magellan Fund is a mutual fund that primarily invests
in the common stocks of broadly diversified foreign and domestic companies.
The Fidelity Growth and Income Fund is a mutual fund that primarily invests
in foreign and domestic stocks. The Fidelity Spartan Market Index Fund is a
mutual fund that invests primarily in stocks that are included in the
Standard & Poor's Index of 500 stocks and in other securities that are
based on the value of the index. The Fidelity Emerging Growth Fund is a
mutual fund which invests in stocks of small and medium-sized developing
companies. The Fidelity Retirement Government Money Market Fund is a money
market mutual fund that invests in obligations issued or guaranteed as to
principal and interest by the U.S. Government. The Fidelity Managed Income
Fund is a pooled investment fund that invests in high-quality, short and
long-term investment contracts, bank investment contracts, short-term money
market instruments and debt obligations issued by one institution and
insured by another as to the payment of principal at maturity.
Investments in the AptarGroup Stock Fund, Penton Media Stock Fund, and
Pittway Stock Fund are valued at quoted market prices. Investments in the
Fidelity Magellan Fund, Fidelity Growth and Income Fund, Fidelity Spartan
Market Index Fund, Fidelity Emerging Growth Fund and Fidelity Diversified
International Fund are valued at quoted market prices which represent the
net asset value of shares held by the Plan at year-end. Investments in the
Fidelity Money Market Fund and Fidelity Managed Income Fund are stated at
fair value as determined by the trustee. Participant loans are valued at
cost which approximates market value.
Purchases and sales of securities, including related gains and losses, are
recorded as of the trade date.
Interest income is recorded when earned. Dividend income is recorded on
the ex-dividend date.
The cost of securities sold is determined on an average cost basis. In
accordance with regulatory requirements for the Plan's Form 5500, the cost
of securities sold is determined based on the fund price at the beginning
of the plan year. This treatment results in a difference in realized and
unrealized appreciation or depreciation between the Plan's Form 5500 and
the financial statements.
Participant loans
The Plan currently provides that a participant may, for any reason, borrow
from the Plan an amount of at least $1,000 and not to exceed 50 percent of
the participant's vested account balance. Prior to August 1, 1997, a
participant could only borrow from the Plan for reasons of financial
hardship. Each participant loan is evidenced by a note and is considered
an investment of that participant's account. Accordingly, principal and
interest payments are credited to the respective participant's account.
Each participant note carries an interest rate equal to the prime rate plus
one percent on the date of the loan, and repayment occurs through payroll
withholding over a period not to exceed 54 months.
Loan proceeds are withdrawn from the participant's account on a defined
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source and fund hierarchy. Loan repayments are applied to funds based on
the most recent fund election percentage designated by the participant.
This activity is reflected within net transfers between funds. All loan
fees are paid by participants and netted against loan interest income.
Contributions
Employer and employee contributions are invested monthly directly in
appropriate funds based on the most recent fund election percentage
designated by the participant.
Benefit payment obligations
Benefit payment obligations to terminated employees at year-end are not
presented as a liability in the Statements of Net Assets Available for
Benefits or as benefit payments in the Statements of Changes in Net Assets
Available for Benefits with Fund Information. This treatment results in a
difference between the Plan's Form 5500 and the financial statements. The
following is a reconciliation of net assets available for benefits per the
financial statements and the Form 5500:
December 31,
1998 1997
Net assets available for benefits per the
financial statements $107,519,552 $131,670,109
Amounts allocated to withdrawing
participants (612,030) (340,987)
Net assets available for benefits
per Form 5500 $106,907,522 $131,329,122
Trustee and administrative expenses
Expenses incurred in the administration of the Plan are paid by the
Company.
NOTE 3 - PARTY-IN-INTEREST TRANSACTIONS:
Party-in-interest transactions consist of loans made to participants and
investments in the Pittway Stock Fund, Penton Media Stock Fund and
AptarGroup Stock Fund. Stock in the Pittway Stock Fund is acquired on the
open market at fair market value on the date purchased. Party-in-interest
transactions also consist of the investments in the Fidelity Funds as
Fidelity is the trustee of the Plan.
NOTE 4 - FEDERAL INCOME TAX STATUS:
The Internal Revenue Service has determined and informed the Company by
letter dated May 22, 1995, that the Plan is designed in accordance with
applicable sections of the Internal Revenue Code (IRC). Furthermore, the
Plan administrator and the Plan's tax counsel believe that the Plan is
designed and is currently being operated in compliance with the applicable
requirements of the IRC.
13
<PAGE>
NOTE 5 - AMENDMENT AND TERMINATION OF PLAN:
The Plan may be amended at any time by the Company. However, no amendment
may adversely affect the current rights of the participants in the Plan
with respect to contributions made prior to the date of the amendment.
Employer contributions may be discontinued and the Company may terminate
the Plan at any time.
The Plan is subject to the provisions of the Employee Retirement Income
Security Act of 1974 (ERISA) applicable to defined contribution plans.
Since the Plan provides for an individual account for each participant and
for benefits based solely on the amount contributed to the participant's
account and any income, expenses, gains and losses attributed thereto, its
benefits are not insured by the Pension Benefit Guaranty Corporation
pursuant to Title IV of ERISA.
NOTE 6 - INVESTMENTS:
The cost and market value of investments at December 31, 1998 and 1997 were
as follows:
Market Number
1998 Cost Value of Shares
Fidelity Diversified Int'l Fund $ 1,318,149 $ 1,480,458 83,547
Fidelity Magellan Fund 18,780,604 27,129,999 224,549
Fidelity Growth & Income Fund 13,911,294 20,329,802 443,493
Fidelity Spartan Market Index Fund 2,074,174 2,679,645 31,418
Fidelity Emerging Growth Fund 2,662,222 3,178,268 100,026
Fidelity Money Market Fund 8,710,070 8,710,071 8,710,070
Fidelity Managed Income Portfolio 2,879,681 2,879,681 2,879,681
AptarGroup, Inc. Common Stock 520,495 2,387,482 85,076*
Penton Media, Inc. Common Stock 3,010,928 6,932,963 342,369
Pittway Corp. Class A Stock 12,691,923 28,550,901 863,531*
$66,559,540 $104,259,270
Market Number
1997 Cost Value of Shares
Fidelity Diversified Int'l Fund $ 1,857,623 $ 1,990,946 123,431
Fidelity Magellan Fund 27,121,715 33,580,413 352,476
Fidelity Growth & Income Fund 18,658,147 25,433,574 667,548
Fidelity Market Index Fund 1,986,249 2,289,081 33,417
Fidelity Emerging Growth Fund 2,901,351 2,671,536 112,486
Fidelity Money Market Fund 17,464,277 17,464,277 17,464,277
Fidelity Managed Income Portfolio 3,817,319 3,817,319 3,817,319
AptarGroup, Inc. Common Stock 692,427 2,984,156 53,769
Pittway Corp. Class A Stock 18,091,747 37,734,016 541,960
$92,590,855 $127,965,318
* The number of shares in Aptar Group and Pittway stock increased following
a 2 for 1 stock split paid August 26, 1998 and September 11, 1998
respectively.
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NOTE 7 - TRANSFER TO OTHER PLAN
On August 7, 1998, the Company spun off its Penton Media Group into a
separate company called Penton Media, Inc. On this date, Plan net assets
for Penton Media Group employees totaling $49,157,651 were transferred to
a new plan established by Penton Media, Inc.
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<TABLE>
PITTWAY CORPORATION
BLUE CHIP PROFIT SHARING AND SAVINGS PLAN
ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT
PURPOSES
AT DECEMBER 31, 1998
<CAPTIONS>
Number of
Interest
Security Description Shares Cost Market Value Rate
<S> <C> <C> <C> <C>
Fidelity Diversified International Fund * 83,547 $ 1,318,149 $ 1,480,458
Fidelity Magellan Fund * 224,549 18,780,604 27,129,999
Fidelity Growth & Income Fund * 443,493 13,911,294 20,329,802
Fidelity Market Index Fund * 31,418 2,074,174 2,679,645
Fidelity Emerging Growth Fund * 100,026 2,662,222 3,178,268
Fidelity Money Market Fund * 8,710,071 8,710,070 8,710,071
Fidelity Managed Income Portfolio * 2,879,681 2,879,681 2,879,681
AptarGroup, Inc. Common Stock * 85,076 520,495 2,387,482
Penton Media, Inc. Common Stock * 342,369 3,010,928 6,932,963
Pittway Corp. Class A Stock * 863,531 12,691,923 28,550,901
Participant Loans * - - 3,224,243 7.75% - 10.00%
Total Assets Held for Investment $66,559,540 $107,483,513
* Party-in-interest.
16
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PITTWAY CORPORATION
BLUE CHIP PROFIT SHARING AND SAVINGS PLAN
ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1998
AGGREGATED 5% SECURITY TRANSACTIONS BY ISSUE
<CAPTIONS>
Current Value
of Asset on
Number of Purchase Selling Cost of Transaction Net Gain
Security Description Transactions Price Price Asset Date or (Loss)
<S> <C> <C> <C> <C> <C> <C>
Fidelity Magellan Fund: *
Acquisitions 220 $7,430,641 $7,430,641 $7,430,641
Dispositions 193 $18,794,926 $15,771,752 $18,794,926 $3,023,174
Fidelity Growth & Income Fund: *
Acquisitions 219 $7,878,560 $7,878,560 $7,878,560
Dispositions 191 $16,163,643 $12,625,412 $16,163,643 $3,538,231
Fidelity Money Market Fund: *
Acquisitions 190 $4,985,792 $4,985,792 $4,985,792
Dispositions 194 $13,729,176 $13,729,176 $13,729,176 -
Fidelity Managed Income Portfolio: *
Acquisitions 168 $3,262,815 $3,262,815 $3,262,815
Dispositions 160 $4,200,453 $4,200,453 $4,200,453 -
Pittway Corp. Class A Stock: *
Acquisitions 145 $9,032,304 $9,032,304 $9,032,304
Dispositions 100 $11,164,897 $8,782,999 $11,164,897 $2,381,898
Penton Corp. Stock: *
Acquisitions 40 $9,673,327 $9,673,327 $9,673,327
Dispositions 38 $3,261,777 $2,649,305 $3,261,777 $612,472
* Party-in-interest.
17
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the Plan) have duly caused this
annual report to be signed on its behalf by the undersigned hereunto duly
authorized.
PITTWAY CORPORATION BLUE CHIP
PROFIT SHARING AND SAVINGS PLAN
BY: /s/ Paul R. Gauvreau
Paul R. Gauvreau
Member of Plan Administrative Committee
Date: June 28, 1999
18
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EXHIBIT 23
PITTWAY CORPORATION
DECEMBER 31, 1998
FORM 11-K
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statements on Form S-8 (Nos. 333-71613, 333-71617 and 333-12615) of
Pittway Corporation of our report dated June 17, 1999 appearing on page 5
of this Form 11-K.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Chicago, Illinois
June 28, 1999
19
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