1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED JULY 31, 1998 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period ______ to ______ Commission file number 1-4987 SL INDUSTRIES, INC. (Exact name of registrant as specified in its charter) NEW JERSEY 21-0682685 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 520 FELLOWSHIP ROAD, SUITE A114, MT. LAUREL, NJ 08054 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: 609-727-1500 Securities registered pursuant to Section 12(b) of the Act: Title of each class Name of each exchange on which registered Common stock, $.20 par value New York Stock Exchange Philadelphia Stock Exchange Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark 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 check mark if disclosure of delinquent filers 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] On October 15, 1998, the aggregate market value of SL common stock was approximately $57,036,000. The number of shares of common stock outstanding as of October 15, 1998, was 5,633,140. DOCUMENTS INCORPORATED BY REFERENCE: Part I, II, IV - Annual Report to Shareholders for the fiscal year ended July 31, 1998 Part III - Proxy Statement dated October 16, 1998 2 PART I ITEM 1. DESCRIPTION OF BUSINESS (a) General Development of Business On March 29, 1956, the Registrant was incorporated as G-L Electronics Company in the state of New Jersey. Its name was changed to G-L Industries, Inc., in November 1963, SGL Industries, Inc., in November 1970 and then to the present name of SL Industries, Inc., in September 1984. The Registrant and its subsidiaries design and produce propriety advanced systems and equipment for the high-growth Power and Data Quality ("PDQ") industry. The products of the Registrant and its subsidiaries either become components of other industrial or consumer products or are sold through distribution for general retail or commercial use. For the most part, the Registrant and its subsidiaries concentrate on specialty markets believed to offer higher profit margins and greater potential for growth than industrial commodities. No single customer accounts for more than 10% of consolidated net sales nor are export sales material thereto. On July 10, 1998, pursuant to a Purchase Agreement dated June 30, 1998, the Registrant, through its wholly-owned subsidiary formed solely for such purpose, SL Industries Vertrieb, GmbH, a German Corporation, acquired 100% of the issued and outstanding Common Shares of Elektro-Metall Export GmbH ("EME"), a German Corporation. The Registrant paid $9,500,000 in cash at closing. EME is a leading German based designer and manufacturer of power quality products. EME is based in Ingolstadt, Germany and maintains low-cost manufacturing operations in Paks, Hungary. (b) Financial Segment Information Financial information about the Registrant's business segments is incorporated herein by reference to Note 13 in the Annual Report to Shareholders for the fiscal year ended July 31, 1998. (c) Narrative Description of Business During fiscal 1997 and 1996, the Registrant was comprised of two business segments - power and data quality and specialty products. Currently, the Registrant operates principally in one business segment; the design, production and marketing of advanced power and data quality systems and equipment for industrial, medical, aerospace and consumer applications. Products Power Supplies - The Registrant produces a wide range of standard and custom power supply products which convert AC or DC power to direct electrical current to be used in customers' end products. Condor D.C. Power Supplies, Inc. ("Condor"), designs, manufactures and markets standard and custom AC-DC and DC-DC power supplies in both linear and switching configurations. These products range in power from 7 to 700 watts and are manufactured in either commercial or medical configurations. Condor's power supplies closely regulate and monitor power outputs, using patented filter and other technologies, resulting in little or no electrical interference. Condor's power supplies service the medical, industrial, 3 telecommunications and instrumentation markets. SL Montevideo Technology, Inc. ("MTI") also incorporates power supplies into its drive systems for electric vehicles and other motion control systems. For the years ended July 31, 1998, 1997 and 1996, Condor's net sales, as a percentage of consolidated net sales, were 27%, 26% and 23%. Power Distribution and Power Conditioning Units - The Registrant is the leader in the design and manufacture of customized power distribution and power conditioning units. Teal Electronics Corporation ("Teal") develops and manufactures custom electrical subsystems for OEM's of semiconductor, medical imaging, graphics and telecommunication systems. Outsourcing the AC power system to Teal helps its customers reduce cost and time to market, while increasing system performance and customer satisfaction. Teal also helps its customers by getting necessary agency approvals. Custom products are often called "Power Conditioning and Distribution Units," which provide voltage conversion and stabilization, system control, and power distribution for systems such as CT and MRI scanners, chip testers and cellular radio systems. Most of Teal's products are sold direct to its OEM customers who include them with their systems, which are sold to the end user. EME's power distribution products can be found in aerospace applications such as passenger entertainment units, and in automotive applications used in mirror controls and general power wiring systems throughout the vehicle. SL Waber, Inc. ("Waber") also designs and manufacturers Power Distribution Units that safely convert a high power input into user specified output ranges. For the years ended July 31, 1998, 1997 and 1996, Teal's net sales, as a percentage of consolidated net sales, were 16%, 13% and 12%. Uninterruptible Power Supplies and Battery Charging - Waber designs and manufactures uninterruptible power supplies that provide back-up power in the event of a power failure. These products are also used to recharge batteries and, in some applications, provide a direct power supply to connected equipment. Two of the products sold are "POWERHOUSE(R)" and "UPSTART(R)", which is an under the monitor product that includes software used to save and restore data, as well as provide typical UPS back up capability and surge protection. This concept was extended to network equipment in 1997 in the form of the "UPSTART Network(TM)" 350 and 550 products. Condor also designs and manufactures custom back-up power supplies for medical equipment and other critical industrial applications. MTI has introduced and developed battery chargers as part of its motion control systems for electric vehicle applications and is advancing its flywheel energy storage systems that provide uninterruptible power by storing electricity as kinetic energy which does not require batteries. Motion Control Systems - MTI is continuing its recent growth as a technological leader in the design and manufacture of intelligent, high power density, precision motors. MTI has been capitalizing on its new motor and (patented and patent pending) motor control technologies to win important programs in both traditional and new market areas. MTI's new motor and motion controls are used in numerous applications, including aerospace, medical and industrial products. Negotiations are continuing with customers on advanced designs for numerous programs including flywheel energy storage systems, high performance missile guidance motors, and medical/surgical drills and saws. EME designs and manufactures electromechanical products for Aerospace and Ordnance applications. Its products are used in aircraft elevator and rudder trim actuation, cargo application and door control. For the years ended July 31, 1998, 1997 and 1996, MTI's net sales, as a percentage of consolidated net sales, were 13%, 10% and 8%. 4 Surge Suppressors and Other - Surge suppressors are sold to protect computers, audiovisual and other electronic equipment from sudden surges in power. Waber is a leader in the design and manufacture of surge suppressors for the custom, OEM and retail marketplaces. These products include those sold under the trademarks of "POWERMASTER(R)" and "DATAGARD(R)". SL Surface Technologies, Inc. ("STI"), provides chromium electroplated, specialty engineered surfaces to the paper, plastics, steel, nuclear and construction industries. The company is a major supplier of these services in the Greater Philadelphia region, and has developed a presence in Western Europe. Sales are made by appropriate company technical personnel. For the years ended July 31, 1998, 1997 and 1996, Waber's net sales, as a percentage of consolidated net sales, were 39%, 41% and 42%. Raw Materials Raw materials are supplied by various domestic and international vendors and availability for materials is not foreseen to be a problem. Raw materials are purchased direct from the manufacturer whenever possible to avoid distributor mark-ups. Average lead times run from immediate availability to eight weeks. In most cases, viable multiple sources are maintained for flexibility and competitive leverage. Seasonality Generally, seasonality is not a factor. Significant Customers No business has a customer which accounts for 10% or more of consolidated net sales. The loss of any one major customer should not have an adverse affect on the business. Backlog Backlog at September 6, 1998, and September 7, 1997, was $40,229,000 and $30,713,000, respectively. The increase is primarily related to the EME acquisition. Excluding EME, the backlog at September 6, 1998, was $30,202,000. Competitive Conditions The businesses are in active competition with domestic companies, some with national name recognition, offering similar products or services and with companies producing alternative products appropriate for the same uses. In addition, Waber and Condor have experienced significant off-shore competition, for certain products in certain markets. Currently, the businesses are sourcing many components and products outside of the United States. The decreasing military market has also created more competitive conditions in both the military and commercial markets. The businesses differentiate themselves from their competitor by concentrating on customized products based on customer needs. Methods of competition are primarily quality, service, innovation, delivery and price. Environmental The Registrant (together with the industries in which it operates or has operated) is subject to United States, Mexican and German environmental laws and regulations concerning emissions to the air, discharges to surface and subsurface waters, and the generation, handling, storage, 5 transportation, treatment and disposal of waste materials. The Registrant and the industries are also subject to other federal, state and local environmental laws and regulations, including those that require the Registrant to remediate or mitigate the effects of the disposal or release of certain chemical substances at various sites, including some where it has ceased operations. It is impossible to predict precisely what affect these laws and regulations will have on the Registrant in the future. However, it is not expected that the Registrant will be affected differently from others in its industries. It is the Registrant's policy to comply with all environmental, health and safety regulations, as well as industry standards for maintenance. The Registrant's domestic competitors are subject to the same environmental, health and safety laws and regulations, and the Registrant believes that the compliance issues and potential expenditures of its operating subsidiaries are comparable to those faced by their major domestic competitors. Environmental liabilities and related costs are believed to have been adequately provided for in the consolidated financial statements. There were no capital expenditures for these purposes during fiscal year 1998 and are estimated to be immaterial for fiscal 1999. For additional information related to environmental issues, see Note 10 to the consolidated financial statements and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Annual Report to Shareholders for the fiscal year ended July 31, 1998, which is incorporated herein by reference. Employees As of September 6, 1998, the Registrant had approximately 2,000 employees. Of these employees, approximately 363 are subject to collective bargaining agreements. Additional Information For the purposes of providing additional information regarding the development of the Registrant's businesses in fiscal 1998, the "PDQ Solutions" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in the Annual Report to Shareholders for the fiscal year ended July 31, 1998, are incorporated by reference. 6 ITEM 2. PROPERTIES Approx. Owned or Leased Square And Location General Character Footage Expiration Date ---------- ----------------- ------- --------------- Montevideo, MN Manufacture of precision motors and motion 38,700 Owned control systems 7,040 Leased - 12/31/98 Matamoros, Mexico Manufacture of precision motors 8,600 Leased - 11/05/99 Nogales, Mexico Manufacture of power protection products 65,000 Leased - 12/31/02 Nogales, AZ Distribution of power protection products 11,700 Leased - Month to Month Mt. Laurel, NJ Corporate Office - power protection products 15,900 Leased - 11/30/99 Manufacture and distribution of power supply Oxnard, CA products 36,400 Leased - 02/28/03 Leased Manufacture and distribution of power supply 40,000 6/01/99 Mexicali, Mexico products 21,500 08/31/00 San Diego, CA Manufacture of AC power subsystems 45,054 Leased - 03/22/02 Manufacture of motion control systems and 39,876 Owned Ingolstadt, Germany power distribution products 17,668 Leased - 09/30/03 Camden, NJ Industrial surface finishing 15,800 Owned Pennsauken, NJ Industrial surface finishing warehouse 6,000 Owned Mt. Laurel, NJ Corporate Office 4,200 Leased - 11/30/99 All manufacturing facilities are adequate for current production requirements. The Registrant believes that its facilities are sufficient for future operations, maintained in good operating condition and adequately insured. Of the owned properties, none are subject to a major encumbrance material to the operations of the Registrant. 7 ITEM 3. LEGAL PROCEEDINGS In the ordinary course of its business, the Registrant is subject to loss contingencies pursuant to foreign and domestic federal, state and local governmental laws and regulations and is also party to certain legal actions, most frequently complaints by terminated employees. It is management's opinion that the impact of these legal actions will not have a material affect on the financial position or results of operations of the Registrant. There are no legal proceedings to which any Director or Officer of the Registrant, or any associate of any Director or Officer, is a party or has a material interest adverse to the Registrant's interest. There are no material proceedings with environmental issues, which involve penalties or sanctions. Additional information pertaining to legal proceedings is found in Note 10 to the consolidated financial statements, and in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Annual Report to Shareholders for the fiscal year ended July 31, 1998, which is incorporated herein by reference. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS During the fourth quarter ended July 31, 1998, there were no matters submitted to a vote of security holders, through a solicitation of proxies or otherwise. PART II ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS --------------------------------------- --------------------------------------- FISCAL 1998 FISCAL 1997 --------------------------------------- --------------------------------------- HIGH LOW HIGH LOW ------------------- ------------------- ------------------- ------------------- Stock Prices 1st Quarter............................... 16 1/4 10 10 1/4 8 1/8 2nd Quarter............................... 13 1/2 11 8 5/8 6 7/8 3rd Quarter............................... 14 7/8 12 7 7/8 6 3/8 4th Quarter............................... 15 3/8 12 1/2 11 7 3/8 Dividends Cash - November........................... $.04 $.03 Cash - June............................... $.04 $.04 --------------------------------------- --------------------------------------- As of September 17, 1998, there were approximately 1,700 registered shareholders. A semi-annual cash dividend of $.04 per share was declared on September 25, 1998, which is payable on November 24, 1998, to shareholders of record on November 2, 1998. 8 ITEM 6. SELECTED FINANCIAL DATA The information required by this item is incorporated herein by reference to the material captioned "Selected Financial Data" in the Annual Report to Shareholders for the fiscal year ended July 31, 1998. ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The information required by this item is incorporated herein by reference to the material captioned "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Annual Report to Shareholders for the fiscal year ended July 31, 1998. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The information required by this item is incorporated herein by reference to the consolidated financial statements and the notes thereto and the material captioned "Report of Independent Public Accountants" and "Selected Quarterly Financial Data (Unaudited)" in the Annual Report to Shareholders for the fiscal year ended July 31, 1998. ITEM 9. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE This item is not applicable. PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT The information required by this item, except for the ages and positions held with the Registrant of the executive officers, is incorporated herein by reference to the material captioned "Election of Directors" on page 5 of the proxy statement dated October 16, 1998. The name, age and positions of each executive officers are as follows: Name Age Position with the Registrant - ---- --- ---------------------------- Owen Farren 47 Chairman of the Board, President and Chief Executive Officer James E. Morris 61 Vice President, Corporate Controller and Treasurer David Nuzzo 41 Vice President - Finance and Administration & Secretary Owen Farren has been Chairman of the Board since June 1998 and President and Chief Executive Officer since April 1991 and prior thereto as Executive Vice President since 1990. James E. Morris has been Vice President and Corporate Controller since September 1991 and Treasurer since November 1995. From November 1995 through December 1997, Mr. Morris served as Corporate Secretary and has been a financial executive since 1978. 9 David R. Nuzzo has been Vice President - Finance and Administration & Secretary since December 1997. ITEM 11. EXECUTIVE COMPENSATION The information required by this item is incorporated herein by reference to the material captioned "The Board of Directors" and "Executive Officer Compensation" on pages 6 through 9 of the proxy statement dated October 16, 1998. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The information required by this item is incorporated herein by reference to the material captioned "Security Ownership of Principal Shareholders and Management" on pages 3 and 4 of the proxy statement dated October 16, 1998. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS The information required by this item, except for related transactions, is incorporated herein by reference to the material captioned "Executive Officer Compensation" on pages 7 through 9 of the proxy statement dated October 16, 1998. PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K (a) (1) Financial Statements The following consolidated financial statements, related notes to consolidated financial statements and the report of independent public accountants appearing in the portions of the Registrant's Annual Report to Shareholders, filed as Exhibit 13, for the fiscal year ended July 31, 1998, are incorporated herein by reference: Consolidated Statements of Earnings - Years ended July 31, 1998, 1997 and 1996 Consolidated Balance Sheets - July 31, 1998 and 1997 Consolidated Statements of Shareholders' Equity - Years ended July 31, 1998, 1997 and 1996 Consolidated Statements of Cash Flows - Years ended July 31, 1998, 1997 and 1996 Notes to Consolidated Financial Statements Report of Independent Public Accountants 10 (a)(2) Financial Statement Schedules The following financial statement schedules for the years 1998, 1997 and 1996 are submitted herewith: Report of Independent Public Accountants - Arthur Andersen LLP Schedule II - Valuation and Qualifying Accounts All other schedules are omitted because (a) the required information is shown elsewhere in the Annual Report, or (b) they are inapplicable, or (c) they are not required. (a)(3) Exhibits The information called for by this section is listed in the Exhibit Index of this report. (b) Reports on Form 8-K On July 24, 1998, the Registrant filed a report dated July 10, 1998, on Form 8-K covering the acquisition of Elektro-Metall Export GmbH. On September 18, 1998, the Registrant filed a report on Form 8-K/A to amend Item 7 of the Form 8-K filed on July 24, 1998. 11 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. SL INDUSTRIES, INC. ------------------- (Registrant) /s/ Owen Farren ------------------- Owen Farren, President October 21, 1998 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 in the capacities and on the dates indicated. /s/ Owen Farren /s/ J. Dwane Baumgardner - --------------- ------------------------ Owen Farren J. Dwane Baumgardner Chairman of the Board, Director President and Chief Executive Officer October 22, 1998 October 21, 1998 /s/ James E. Morris /s/ Edward A. Gaugler - ------------------- --------------------- James E. Morris Edward A. Gaugler Vice President, Director Corporate Controller, October 22, 1998 and Treasurer October 21, 1998 /s/ George R. Hornig -------------------- George R. Hornig Director October 22, 1998 /s/ Walter I. Rickard --------------------- Walter I. Rickard Director October 22, 1998 /s/ Robert J. Sanator --------------------- Robert J. Sanator Director October 22, 1998 12 COMMISSION FILE NO. 1-4987 - -------------------------------------------------------------------------------- SL INDUSTRIES, INC. AND SUBSIDIARIES SUPPORTING SCHEDULES FOR ANNUAL REPORT (Form 10-K) TO SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 13 ARTHUR ANDERSEN LLP REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To SL Industries, Inc.: We have audited in accordance with generally accepted auditing standards, the consolidated financial statements included in SL Industries, Inc.'s annual report to shareholders incorporated by reference in this Form 10-K, and have issued our report thereon dated September 10, 1998. Our audits were made for the purpose of forming an opinion on those statements taken as a whole. The schedule listed in the index at Item 14 (a)(2) is the responsibility of the Company's management and is presented for purposes of complying with the Securities and Exchange Commission's rules and is not part of the basic financial statements. This schedule has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, fairly states in all material respects the financial data required to be set forth therein in relation to the basic financial statements taken as a whole. ARTHUR ANDERSEN LLP Philadelphia, PA September 10, 1998 14 SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS FOR THE YEARS ENDED JULY 31, 1998, 1997 AND 1996 (In Thousands) - -------------------------------------------------------------------------------------------------------------------- Additions ----------------------------------------- Balance at Charged to Charged to Beginning of Costs and Other Balance at Description Period Expenses Accounts Deductions End of Period - -------------------------------------------------------------------------------------------------------------------- YEAR 1998 Allowance for: doubtful accounts $496 $53 $85 $44(a) $590 ==== === === === ==== customer credits $1,294 $2,462 $-- $2,301(b) $1,455 ====== ====== === ====== ====== YEAR 1997 Allowance for: doubtful accounts $428 $62 $35 $29 $496 ==== === === === ==== customer credits $1,212 $2,157 $-- $2,075(b) $1,294 ====== ====== === ====== ====== YEAR 1996 Allowance for: doubtful accounts $453 $151 $41 $217(a) $428 ==== ==== === ==== ==== customer credits $1,367 $1,888 $-- $2,043(b) $1,212 ====== ====== === ====== ====== - ----------------- (a) Accounts receivable written off, net of recoveries. (b) Primarily for customer advertising programs. 15 INDEX TO EXHIBITS The exhibit number, description and sequential page number in the original copy of this document where exhibits can be found follows: Exhibit # Description - --------- ----------- 3.1 Articles of Incorporation. Copy of Certificate of Incorporation as amended (transmitted herewith). 3.2 By-Laws. Incorporated by reference to Exhibit 3 to the Registrant's report on Form 10-Q for the quarters ended October 31, 1994 and October 31, 1996. 10.1 Supplemental Compensation Agreement for the Benefit of Byrne Litschgi. Incorporated by reference to Exhibit 10.1 to the Registrants report on Form 8 dated November 9, 1990. 10.2 Chairman's Executive Severance Agreement. Incorporated by reference to Exhibit 10.2 to the Registrant's report on Form 8 dated November 9, 1990. 10.3 First Amendment to Chairman's Executive Severance Agreement and to Supplemental Compensation Agreement. Incorporated by reference to Exhibit 10.3.1 to the Registrant's report on Form 8 dated November 9, 1990. 10.4 Second Amendment to Chairman's Executive Severance Agreement and to Supplemental Compensation Agreement. Incorporated by reference to Exhibit 10.3.2 to the Registrant's report on Form 8 dated November 9, 1990. 10.5 Third Amendment to Chairman's Executive Severance Agreement and to Supplemental Compensation Agreement. Incorporated by reference to Exhibit 10.3.3 to the Registrant's report on Form 8 dated November 9, 1990. 10.6 Fourth Amendment to Chairman's Executive Severance Agreement and to Supplemental Compensation Agreement. Incorporated by reference to Exhibit 10.3.2 to the Registrant's report on Form 8 dated November 9, 1990. 10.7 Deferred Supplemental Compensation Agreement with Grant Heilman. Incorporated by reference to Exhibit 10.4.5 to the Registrant's report on Form 8 dated November 9, 1990. 10.8 Deferred Supplemental Compensation Agreement with William Hess. Incorporated by reference to Exhibit 10.4.6 to the Registrant's report on Form 8 dated November 9, 1990. 10.9 Supplemental Compensation Agreement for the Benefit of Donald J. Lloyd-Jones. Incorporated by reference to Exhibit 10.5.1 to the Registrant's report on Form 8 dated November 9, 1990. 10.10 Supplemental Compensation Agreement for the Benefit of Salvatore J. Nuzzo. Incorporated by reference to Exhibit 10.5.3 to the Registrant's report on Form 8 dated November 9, 1990. 10.11 Supplemental Compensation Agreement for the Benefit of Marlin Miller, Jr. Incorporated by reference to Exhibit 10.5.4 to the Registrant's report on Form 8 dated November 9, 1990. 16 10.12 Supplemental Compensation Agreement for the Benefit of Grant Heilman. Incorporated by reference to Exhibit 10.5.5 to the Registrant's report on Form 8 dated November 9, 1990. 10.13 Supplemental Compensation Agreement for the Benefit of William M. Hess. Incorporated by reference to Exhibit 10.5.6 to the Registrant's report on Form 8 dated November 9, 1990. 10.14 1988 Deferred Compensation Agreement with a Certain Officer. Incorporated by reference to Exhibit 10.6 to the Registrant's report on Form 8 dated November 9, 1990. 10.15 Death Benefit Arrangement with Certain Officers adopted by Board Resolution dated September 18, 1975. Incorporated by reference to Exhibit 10.7 to the Registrant's report on Form 8 dated November 9, 1990. 10.16 Non-Qualified Stock Option Agreement dated June 19, 1991. Incorporated by reference to Exhibit 10-A to the Registrant's report on Form 10-K for the fiscal year ended July 31, 1991. 10.17 Non-Qualified Stock Option Agreement dated September 25, 1991. Incorporated by reference to Exhibit 10-B to the Registrant's report on Form 10-K for the fiscal year ended July 31, 1991. 10.18 Severance Pay Agreement with Owen Farren. Incorporated by reference to Exhibit 10-C to the Registrant's report on Form 10-K for the fiscal year ended July 31, 1991. 10.19 Severance Pay Agreement with Ted D. Taubeneck. Incorporated by reference to Exhibit 10-D to the Registrant's report on Form 10-K for the fiscal year ended July 31, 1991. 10.20 Deferred Compensation Agreement with James E. Morris. Incorporated by reference to Exhibit 10-E to the Registrant's report on Form 10-K for the fiscal year ended July 31, 1991. 10.21 1991 Long Term Incentive Plan of SL Industries, Inc., as amended, is incorporated by reference to Appendix to the Registrant's Proxy Statement for its 1995 Annual Meeting held November 17, 1995, previously filed with the Securities and Exchange Commission. 10.22 SL Industries, Inc. Non-Employee Director Non-Qualified Stock Option Plan. Incorporated by reference to Exhibit 4.3 to Registration Statement No. 33-63681, filed October 25, 1995. 10.23 Capital Accumulation Plan. Incorporated by reference to the Registrant's report on Form 10K/A for the fiscal period ended July 31, 1994. 10.24 Amendment No. 1 to Non-Qualified Stock Option Agreement dated September 25, 1991, is incorporated herein by reference to Exhibit 4.5 to Registration Statement on Form S-8/A (No. 33-53274) filed with the Securities and Exchange Commission on June 18, 1996. 10.25 Non-Qualified Stock Option Agreement Incorporated by reference to Exhibit 4.3 to Registration Statement No. 33-65445, filed December 28, 1995. 10.26 Severance Pay Agreement with James D. Klemashevich. Incorporated by reference to Exhibit 10.26 to the Registrant's report on Form 10-K for the fiscal year ended July 31, 1997. 17 10.27 Severance Pay Agreement with David R. Nuzzo. Incorporated by reference to Exhibit 10.1 to the Registrant's report on Form 10-K for the fiscal year ended July 31, 1998. 11 Statement Re Computation of Per Share Earnings (transmitted herewith). 13 Portions of Annual Report to Shareholders for the fiscal year ended July 31, 1998 (transmitted herewith). 17 Letter Re Director Resignation. Incorporated by reference to the Registrant's report on Form 8-K filed on October 20, 1992. 22 Subsidiaries of the Registrant (transmitted herewith). 24 Consent of Independent Public Accountants - Arthur Andersen LLP (transmitted herewith). 27 Financial Data Schedule (Schedule is furnished for the information of the Securities and Exchange Commission and is not to be deemed "filed" as part of Form 10-K, or otherwise subject to the liabilities of Section 18 of the Securities Exchange Act of 1934). 28 Annual Report on Form 11-K (to be filed by amendment).