Item 1. Business
(a) General Development of Business
Standard Shares, Inc. ("Standard") was incorporated under Delaware law in 1925.
On December 28, 1989, Pittway Corporation ("Old Pittway"), a Pennsylvania corporation incorporated in 1950, merged into Standard through an exchange of stock and Standard changed its name to Pittway Corporation ("Pittway" or "Registrant"). Prior to the merger Standard owned 50.1% of Old Pittway. The merger was accounted for in a manner similar to a pooling of interests, using historical book values. Pittway and its subsidiaries are referred to herein collectively as the "Company".
The Company operates in two reportable industry segments: alarm and other security products, and publishing.
During the first half of 1994, the Company sold its 16.67% ownership in First Alert, Inc., a manufacturer of residential fire protection products, as part of an initial public offering of that company's common stock. Financial information relating to this transaction is set forth in Note 12 ("Fair Value of Financial Instruments") to the Consolidated Financial Statements contained in the 1994 Annual Report to Stockholders, page 35, which Note is incorporated herein by reference.
In April 1993, the Company distributed its investment in the AptarGroup, Inc. (formerly known as the Seaquist Division packaging group) to stockholders in a tax-free spinoff. AptarGroup, Inc. is a manufacturer of aerosol valves, dispensing pumps and closures which are sold to packagers and marketers in the personal care, fragrance/cosmetics, pharmaceutical, household products and food industries. In October 1992, the Company sold its Barr Company, a contract packager for marketers of aerosol and liquid fill (non- aerosol) personal and household products, to a Canadian packaging company. In July 1992, the Company sold its First Alert/BRK Electronics business to a new company formed by BRK management and an investment firm. Financial information relating to these transactions is set forth in Note 1 ("Discontinued Operations") to the Consolidated Financial Statements contained in the 1994 Annual Report to Stockholders, page 31, which Note is incorporated herein by reference.
In 1991, the Company sold its expedited ground transportation service business to its local management.
(b) Financial Information about Industry Segments
Financial information relating to industry segments for each of the three years ended December 31, 1994 is set forth in Note 13 ("Segment Information") to the Consolidated Financial Statements contained in the 1994 Annual Report to Stockholders, pages 35-36, which Note is incor- porated herein by reference.
(c) Narrative Description of Business
The principal operations, products and services rendered by the Company:
Alarm and Other Security Products Segment
This segment involves the design, manufacture and sale of an extensive line of burglar alarm, commercial fire detection and alarm components and systems and the distribution of alarm and other security products manufactured by other companies. By offering a broad line of alarm products needed for security systems, the Company provides a full range of services to independent alarm dealers and installers which range in size from one-person operations to the largest national alarm service companies. In every major domestic market area, quick delivery is provided through the Company's computerized regional warehouses and convenience center outlets, authorized distributors and dealers. Various products sold through the alarm system distribution group are purchased from non-affiliated suppliers and manufacturers to offer a broad range of products. Some of the products purchased are resold under the Company's Ademco brand name, others are resold under brand names owned by its suppliers. In the Canadian and overseas markets, alarm and other security products are sold through the Company's distribution centers, authorized distributors and sales agents. The Company also offers AlarmNet to alarm companies in major U.S. markets. AlarmNet is a wireless cellular-like communication network designed to transmit security alarm signals by radio instead of over telephone lines.
Commercial fire detectors and fire controls are sold through the Company's regional warehouses, electrical and building supply wholesalers and alarm and fire safety distributors.
Raw materials essential to the Company's businesses are purchased worldwide in the ordinary course of business from numerous suppliers. The vast majority of these materials are generally available from more than one supplier and no serious shortages or delays have been en- countered. Certain raw materials used in producing some of the Company's products can be obtained only from one or two suppliers, the shortage of which could adversely impact production of alarm equipment and commercial fire detectors by the Company. The Company believes that the loss of any other single source of supply would not have a material adverse effect on its overall business.
Through its NESCO subsidiary the Company offers a wide variety of services to independent distributors of its fire alarm systems products, including assistance with system design, bonding, technical help, training, marketing and administrative support. The Company also offers a brand name marketing program to independent burglar alarm dealers.
Sales and marketing methods common to this industry segment include communications through the circulation of catalogs and merchandising bulletins, direct mail campaigns, and national and local advertising in trade publications. The Company's principal advantages in marketing are its reputation, broad product line, high quality products, extensive integrated distribution network, efficient customer service, competitive prices and brand names.
Within the industry there is competition from large and small manufac- turers in both the domestic and foreign markets. While competitors will continue to introduce new products similar to those sold by the Company, the Company believes that its research and development efforts and the breadth and quality of its distribution network will permit it to remain competitive.
Publishing Segment
This segment is a publisher of 43 national business and trade publications with other businesses in the marketing-communications field. The Company's publications serve both specific industries and broad functional markets which include specialized manufacturing, service industries, technical and professional fields and general management. Most publications are distributed on a monthly basis with several others distributed on a biweekly, annual or biennial frequency. One magazine is subscription-based; the other publications are generally distributed free through controlled circulation. The principal source of revenue is from the sale of advertising space within the magazines. Other facets of the business include: the operation of a printing plant for the printing and production of most of the Company's publications and those of other publishers; a national mail-marketing and direct mail production organization; a majority- owned subsidiary specializing in the design, development and conduct of courses and conferences for managerial, professional and technical personnel; research and telemarketing services; direct-response card mailer service and special publications.
Within the publishing and marketing communications fields, competition exists in the form of other publications and media communication businesses. Reductions in advertising schedules by domestic industrial companies due to economic and other competitive pressures directly impacts the display advertising levels of the Company's publishing segment. The Company competes with one or more other magazines for advertising revenue in each of its magazine titles. The Company's principal sales advantages include relevant editorial content and innovative marketing complemented by specialized multi-magazine supplements. The Company believes that its competitive position also benefits from improvements in manufacturing productivity and from cost control programs. The Company places great emphasis on providing quality products and services to its customers.
Real Estate and Other Ventures
The Company is involved in the marketing and sale and development of land near Tampa, Florida for residential and commercial use. Fairway Village is an improved residential property being developed into single family homes situated adjacent to a major resort. Saddlebrook Village, a 2,000 acre parcel of land nearby, is approved for development as a master planned community. Saddlebrook Corporate Center, a nearby 450 acre parcel, is a master planned business park for mixed use development including light manufacturing, research and development, distribution and warehousing, retail and other businesses. Principal competition comes from other residential and commercial developments in Florida.
The Company has a limited partnership interest in a real estate developer with major commercial and residential high rise properties in Chicago, Dallas, Los Angeles and Boston. See Item 7 of this Form 10-K. The Company also has invested, as a 5% limited partner, in three rental apartment complexes located in Chicago and Washington, D.C. which provide certain tax advantages.
The Company also has a 45% interest in a leading manufacturer of commercial data encryption, wireline, and spread spectrum wireless products; a 5% equity interest in a satellite broadcast company which began operations in mid-1994; and a 12% interest in a developer of wireless signaling equipment for communication between fixed points.
Other Information
Patents and Trademarks -
While the Company owns or is licensed under a number of patents which are cumulatively important to its business, the loss of any single patent or group of patents would not have a material adverse effect on the Company's overall business.
Products manufactured by the Company are sold primarily under its own trademarks and tradenames. Some products purchased and resold by the Company's alarm and security products business are sold under the Company's tradenames while others are sold under tradenames owned by its suppliers.
Customers -
Neither of the Company's industry segments is dependent upon a single customer or a few customers. The loss of any one or more of these customers would not have a material adverse effect on the Company's results of operations.
Research and Development -
The Company is engaged in programs to develop and improve products as well as develop new and improved manufacturing methods. Expenditures for Company sponsored research and development activities in the alarm and other security products segment were $11.8 million in 1994, $10.8 million in 1993 and $10.0 million in 1992. These costs were associated with a number of products in varying stages of development, none of which represents a significant item of cost or is projected to be a significant addition to the Company's line of products.
Acquisitions and Dispositions -
Acquisitions of businesses by the Company in each of the three years ended December 31, 1994 were not significant to the Company's sales or results of operations. Dispositions by the Company, other than the discontinued operations previously discussed in the "General Development of Business" section, in each of the three years ended December 31, 1994 were not significant to the Company's sales or results of operations.
Product Liability -
Due to the nature of the alarm security business, the Company has been, and continues to be, subjected to numerous claims and lawsuits alleging defects in its products. This exposure has been lessened by the sale of First Alert/BRK Electronics. It is likely, due to the present litigious atmosphere in the United States, that additional claims and lawsuits will be filed in future years. The Company believes that it maintains sufficient insurance to cover this exposure.
While it believes that resolution of existing claims and lawsuits will not have a material adverse effect on the Company's financial statements, management is unable to estimate the financial impact of claims and lawsuits which may be filed in the future.
Environmental Matters -
The Company anticipates that compliance with various laws and regula- tions relating to protection of the environment will not have a material effect on its capital expenditures, earnings or competitive position.
Employees -
At December 31, 1994, there were approximately 5,400 persons employed by the Company, including 4,500 employed in the United States. Approximately 1,100 of these employees were represented by labor unions. The Company considers its relations with its employees and the unions representing its employees to be good.
(d) Financial Information About Foreign and Domestic Operations and Export Sales
Financial information concerning foreign and domestic operations and export sales is set forth in Note 13 ("Segment Information") to the Consolidated Financial Statements contained in the 1994 Annual Report to Stockholders, pages 35-36, which Note is incorporated herein by reference.
Item 2.
Item 2. Properties
The Company's principal properties and their general characteristics are as follows: Principal Lease Approximate Location Use Expiration Square Feet Alarm and Other Security Products Segment- Syosset, New York (1) N/A 360,000 Syosset, New York (3) 1997 14,000 Torrance, California (1) 1997 48,000 Northford, Connecticut (1) N/A 179,000 St. Charles, Illinois (1) 2003 158,000 St. Charles, Illinois (1) 2004 50,000 West Chicago, Illinois (1) 1998 21,000 San Antonio, Texas (3) 1995 14,000 Melbourne, Australia (2) 1995 5,000 Sydney, Australia (2) 1998 25,000 Montreal, Canada (2) 1995 8,000 Toronto, Canada (2) 1997 7,000 Brighton, England (1) 1997 24,000 Milan, Italy (1) N/A 14,000 Milan, Italy (2) 1998 8,000 Trieste, Italy (1) N/A 40,000 Juarez, Mexico (4) 1999 68,000 Madrid, Spain (2) 1998 8,000
Distribution Centers Hub Locations: Atlanta, Georgia (2) 1995 29,000 Boston, Massachusetts (2) 1999 14,000 Los Angeles, California (2) 1999 30,000 Chicago, Illinois (2) 2005 40,000 Clearwater, Florida (2) 2004 27,000 Dallas, Texas (2) 1996 24,000 Detroit, Michigan (2) 1995 10,000 Greensboro, North Carolina (2) 1995 7,000 Memphis, Tennessee (2) 2006 15,000 Fairfield, New Jersey (2) 1996 16,000 Pensauken, New Jersey (2) 1995 26,000 Richmond, Virginia (2) 2004 14,000 Louisville, Kentucky (2) 1999 60,000
Publishing Segment- Cleveland, Ohio (3) 2000 179,000 Cleveland, Ohio (2) 1996 30,000 Berea, Ohio (5) N/A 100,000 New York, New York (3) 1996 10,000 Dunedin, Florida (3) 1995 8,000 Safety Harbor, Florida (1) 1995 19,000 Tampa, Florida (1) 1999 30,000
General Corporate- Chicago, Illinois (3) 2001 12,000
Other properties in the alarm and other security products segment include 67 full-line convenience centers in addition to those hub locations listed above which function as retail-like sales distribution outlets to serve the North American market. These 67 centers are under leases expiring through 2004 and range in size from 1,500 to 22,000 square feet. Other properties in the publishing segment include 12 sales and/or editorial offices under leases expiring through 2003 located in major cities throughout the United States. The Company believes the above facilities are adequate for its present needs.
(1) Offices, Manufacturing and Warehousing (2) Warehousing (3) General Offices (4) Manufacturing (5) Printing N/A Not applicable - facilities are owned by the Company
Item 3.
Item 3. Legal Proceedings
On May 10, 1989, the Circuit Court of the Sixth Judicial Circuit in and for Pasco County, Florida, entered a judgment against Saddlebrook Resorts, Inc. ("Saddlebrook"), a former subsidiary of the Company, in a lawsuit which arose out of the development of Saddlebrook's resort and a portion of the adjoining residential properties owned and currently under development by the Company. The lawsuit (James H. Porter and Martha Porter, Trustees, et al. vs. Saddlebrook Resorts, Inc. and The County of Pasco, Florida; Case No. CA83-1860), alleges damage to plaintiffs' adjoining property caused by surface water effects from improvements to the properties. Damages of approximately $8 million were awarded to the plaintiffs and an injunction was entered requiring, among other things, that Saddlebrook work with local regulatory authorities to take corrective actions. Saddlebrook made two motions for a new trial, based on separate grounds. One such motion was granted on December 18, 1990. Such grant was appealed by the plaintiffs. The other such motion was denied on February 28, 1991. Saddlebrook appealed such denial. The appeals were consolidated, fully briefed and heard in February 1992. Saddlebrook received a favorable ruling on March 18, 1992, dismissing the judgment and remanding the case to the Circuit Court for a new trial. An agreed order has been entered by the Court preserving the substance of the injunction pending final disposition of this matter. As part of its plan to comply with the agreed order, Saddlebrook filed applications with the regulatory agency to undertake various remediation efforts. Plaintiffs, however, filed petitions for administrative review of the applications, which administrative hearing was concluded in February 1992. On March 31, 1992, the hearing officer issued a recommended order accepting Saddlebrook's expert's testimony. The agency's governing board was scheduled to consider this recommended order on April 28, 1992, however, shortly before the hearing, the plaintiffs voluntarily dismissed their petitions and withdrew their challenges to the staff's proposal to issue a permit. At the April 28, 1992 hearing the governing board closed its file on the matter and issued the permits. Saddlebrook appealed the board's refusal to issue a final order. On July 9, 1993 a decision was rendered for Saddlebrook remanding jurisdiction to the governing board for further proceedings, including entry of a final order which was issued on October 25, 1993. The
plaintiffs have appealed the Appellate Court decision to the Florida Supreme Court and appealed the issuance of the final order to the Second District Court of Appeals. The Florida Supreme Court heard the appeal on May 3, 1994 and denied plaintiffs' appeal. The other appeal was voluntarily dismissed by the plaintiffs on June 17, 1994. On remand to the trial court, Saddlebrook's motion for summary judgment, on the ground that plaintiffs' claims were fully retried and rejected in a related administrative proceeding was granted on December 7, 1994. Plaintiffs have filed for a rehearing which was denied.
Until October 14, 1989, Saddlebrook disputed responsibility for ultimate liability and costs (including costs of corrective action). On that date, the Company and Saddlebrook entered into an agreement with regard to such matters. The agreement, as amended and restated on July 16, 1993, provides for the Company and Saddlebrook to split equally the costs of the defense of the litigation and the costs of certain related litigation and proceedings, the costs of the ultimate judgment, if any, and the costs of any mandated remedial work. Subject to certain conditions, the agreement permits Saddlebrook to obtain subordinated loans from the Company to enable Saddlebrook to pay its one-half of the costs of the latter two items. No loans have been made to date.
The Company believes that the ultimate outcome of the aforementioned lawsuit will not have a material adverse effect on its financial statements.
Item 4.
Item 4. Submission of Matters to a Vote of Security Holders
None.
PART II
Item 5.
Item 5. Market For Registrant's Common Equity and Related Stock- holder Matters
The information set forth under the heading "Market Prices, Security Holders and Dividend Information" appearing on page 39 of the Company's 1994 Annual Report to Stockholders is incorporated herein by reference.
Item 6.
Item 6. Selected Financial Data
The information set forth under the heading "Supplemental Information - Five Year Summary of Selected Financial Data" appearing on page 39 of the Company's 1994 Annual Report to Stockholders is incorporated herein by reference.
Item 7.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
The information set forth under the heading "Management's Discussion and Analysis of Consolidated Results of Operations and Financial Condition" appearing on pages 40-41 of the Company's 1994 Annual Report to Stockholders is incorporated herein by reference.
Item 8.
Item 8. Financial Statements and Supplementary Data
The Company's Consolidated Financial Statements and Summary of Accounting Policies and Notes thereto, together with the report thereon of Price Waterhouse LLP dated February 22, 1995, appearing on pages 25- 38 of the Company's 1994 Annual Report to Stockholders are incorporated herein by reference.
Item 9.
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
None.
PART III
Information required to be furnished in this part of the Form 10-K has been omitted because the Registrant will file with the Securities and Exchange Commission a definitive proxy statement pursuant to Regulation 14A under the Securities Exchange Act of 1934 not later than April 30, 1995.
Item 10.
Item 10. Directors and Executive Officers of the Registrant
The information set forth under the headings "Nominees for Election by the Holders of Class A Stock", "Nominees for Election by the Holders of Common Stock", "Executive Officers" and "Section 16(a) Reports" in the Registrant's Proxy Statement for the annual meeting of stockholders to be held on May 11, 1995 is incorporated herein by reference.
Item 11.
Item 11. Executive Compensation
The information set forth under the headings "Compensation Committee Interlocks and Insider Participation", "Compensation", "Compensation Committee Report on Executive Compensation" and "Performance Graph" in the Registrant's Proxy Statement for the annual meeting of stockholders to be held on May 11, 1995 is incorporated herein by reference.
Item 12.
Item 12. Security Ownership of Certain Beneficial Owners and Management
The information set forth under the heading "Security Ownership of Certain Beneficial Owners and Management" in the Registrant's Proxy Statement for the annual meeting of stockholders to be held on May 11, 1995 is incorporated herein by reference.
Item 13.
Item 13. Certain Relationships and Related Transactions
The information set forth under the headings "Certain Transactions" (and the information set forth under the heading "Compensation Committee Interlocks and Insider Participation" which is cross- referenced under the heading "Certain Transactions") in the Registrant's Proxy Statement for the annual meeting of stockholders to be held on May 11, 1995 is incorporated herein by reference.
PART IV
Item 14.
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a) Financial statements and financial statement schedules filed as a part of this report are listed in the Index to Consolidated Financial Statements and Financial Statement Schedules on pages 14-15 of this Form 10-K and are incorporated herein by reference.
Exhibits required by Item 601 of Regulation S-K are listed in the Index to Exhibits on pages 18-19 of this Form 10-K, which is incorporated herein by reference. Each management contract or compensatory plan or arrangement required to be filed as an Exhibit to this report pursuant to Item 14 (c) of Form 10-K is so identified on the Index to Exhibits.
(b) No reports on Form 8-K have been filed during the quarter for which this report is filed.
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) 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.
PITTWAY CORPORATION (Registrant)
BY /s/ Paul R. Gauvreau Paul R. Gauvreau Financial Vice President and Treasurer Date: March 24, 1995
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities indicated on March 24, 1995.
/s/ Neison Harris /s/ E. David Coolidge III Neison Harris, Director and E. David Coolidge III, Director Chairman of the Board
/s/ King Harris /s/ Anthony Downs King Harris, Director, President Anthony Downs, Director and Chief Executive Officer
/s/ Paul R. Gauvreau /s/ Leo A. Guthart Paul R. Gauvreau, Principal Leo A. Guthart, Director Financial and Accounting Officer
/s/ Eugene L. Barnett /s/ Irving B. Harris Eugene L. Barnett, Director Irving B. Harris, Director
/s/ Sidney Barrows /s/ William W. Harris Sidney Barrows, Director William W. Harris, Director
/s/ Fred Conforti /s/ Jerome Kahn, Jr. Fred Conforti, Director Jerome Kahn, Jr., Director
PITTWAY CORPORATION INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES
The following documents are filed as a part of this report:
Page reference in Annual Report to Stockholders
Financial Statements required by Item 8 of this Form:
Consolidated Balance Sheet at December 31, 1994 and 1993................ 26-27 For each of the three years ended December 31, 1994 - Consolidated Statement of Income........ 25 Consolidated Statement of Cash Flows.... 28 Consolidated Statement of Stockholders' Equity.................. 29 Summary of Accounting Policies and Notes to Consolidated Financial Statements...... 30-37 Report of Independent Accountants............. 38
Page reference in Form 10-K
Financial Statement Schedule required by Article 12 of Regulation S-X:
Report of Independent Accountants on Financial Statement Schedule.............. 16 Consolidated Financial Statement Schedule - VIII. Valuation and Qualifying Accounts.. 17
PITTWAY CORPORATION INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES
Continued -
The consolidated financial statements of Pittway Corporation, listed in the above index together with the Report of Independent Accountants, which are included in the Company's 1994 Annual Report to Stockholders, are incorporated herein by reference.
All other schedules have been omitted because the required information is not present, or is not present in amounts sufficient to require submission of the schedule, or because the information required is included in the consolidated financial statements or notes thereto.
With the exception of the aforementioned information and information incorporated by reference in Part I (in Item 1) and Part II (in Items 5, 6, 7 and 8) of this Form 10-K, the Company's 1994 Annual Report to Stockholders is not deemed to be filed as part of this report.
The individual financial statements of the Company have been omitted because Pittway Corporation is primarily an operating company and the restricted net assets of subsidiaries together with the equity in undistributed earnings of equity investees is less than 25 percent of consolidated net assets. Summarized financial information for the limited real estate partnerships and other ventures is omitted because, when considered in the aggregate, they do not constitute a significant subsidiary.
Report of Independent Accountants on Financial Statement Schedule
To the Board of Directors of Pittway Corporation
Our audits of the consolidated financial statements referred to
in our report dated February 22, 1995 appearing on page 38 of the 1994
Annual Report to Stockholders of Pittway Corporation (which report and
consolidated financial statements are incorporated by reference in this
Annual Report on Form 10-K) also included an audit of the Financial
Statement Schedule listed in the index on page 14 of this Form 10-K.
In our opinion, the Financial Statement Schedule presents fairly, in
all material respects, the information set forth therein when read in
conjunction with the related consolidated financial statements.
As discussed in Notes 4 and 7 to the consolidated financial
statements, in 1993 the Company changed its method of accounting for
income taxes and for postretirement benefits other than pensions.
/s/ Price Waterhouse LLP Price Waterhouse LLP
Chicago, Illinois February 22, 1995
INDEX TO EXHIBITS Sequential Number and Description of Exhibit Page Number***
3.1 Restated Certificate of Incorporation of Registrant (incorporated by reference to Exhibit 3.1 of the Registrant's Annual Report on Form 10-K for the year ended February 29, 1988).
3.2 Certificate of Amendment to Restated Certificate of Incorporation of Registrant (incorporated by reference to Exhibit 4.2 of the Registrant's Form S-8 Registration Statement No. 33 - 33312 filed with the Commission on February 2, 1990).
3.3 Bylaws of Registrant (incorporated by reference to Exhibit 4.3 of the Registrant's Form S-8 Registration Statement No. 33 - 33312 filed with the Commission on February 2, 1990).
4. The Registrant hereby agrees to provide the Commission, upon request, copies of such instruments defining the rights of holders of long-term debt of the Registrant and its subsidiaries as are specified in Item 601(b)(4)(iii) of Regulation S-K.
10.1 Amended and Restated Merger Agreement and Plan of Reorganization (incorporated by reference to Exhibit 2 of the Registrant's Form S-4 Registration Statement No. 33 - 31519 filed with the Commission on October 11, 1989).
10.2 Pittway Corporation 1990 Stock Awards Plan, as amended, (incorporated by reference to the Registrant's Form S-8 Registration Statement No. 33 - 54753 filed with the Commission on July 27, 1994).
10.3 Agreement of employment dated as of July 1, 1990 with Sal F. Marino, as amended (incorporated by reference to Exhibit 10.5 of the Registrant's Annual Report on Form 10-K for the year ended December 31, 1992.)**
10.4 Second Extension and Amendment of Agreement of Employment with Sal F. Marino dated December 31, 1993 (incorporated by reference to Exhibit 10.4 of the Registrant's Annual Report on Form 10-K for the year ended December 31, 1993.)**
INDEX TO EXHIBITS - cont'd.
Sequential Number and Description of Exhibit Page Number***
10.5 Third Extension and Amendment of Agreement of Employment with Sal F. Marino dated December 31, 1994.**
10.6 Agreement of Employment dated July 2, 1973 with Leo A. Guthart, as amended (incorporated by reference to Exhibit 10(f) of the Registrant's Form S-4 Registration Statement No. 33-31519 filed with the Commission on October 11, 1989).**
13. 1994 Annual Report to Stockholders.*
21. Subsidiaries of the Registrant.
23. Consent of Independent Accountants.
27. Financial Data Schedule (submitted only in electronic format).
* Such report, except to the extent incorporated herein by reference, is being furnished for the information of the Securities and Exchange Commission only and is not to be deemed filed as a part of this Form 10-K.
** This document is a management contract or compensatory plan or arrangement required to be filed as an exhibit to this report pursuant to Item 14 (c) of Form 10-K.
*** This information appears only in the manually signed original of this Form 10-K.