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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
[X] Annual report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the fiscal year ended December 31, 2002 or
[ ] Transition report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the transition period from __________ to ___________
COMMISSION FILE NO. 0-13787
INTERMET CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
GEORGIA 58-1563873
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
5445 Corporate Drive, Suite 200, Troy, Michigan 48098-2683
(Address of principal executive offices) (Zip code)
(248) 952-2500
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
Title of each class Name of each exchange on which registered
None Not applicable
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
COMMON STOCK, $0.10 PAR VALUE
(TITLE OF CLASS)
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 pursuant to Item 405
of Regulation S-K is not contained herein and will not be contained, to the best
of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act). Yes [X] No [ ]
Aggregate market value of the voting stock held by non-affiliates of the
registrant as of February 25, 2003 was $105,737,875 based on $4.13 per share,
the closing sale price of the common stock as quoted on the Nasdaq National
Market. For purposes of determining the aggregate market value of the
Registrant's voting stock held by non-affiliates, shares held by all current
directors and executive officers of the Registrant have been excluded. The
exclusion of such shares is not intended to, and shall not, constitute a
determination as to which persons or entities may be "affiliates" of the
Registrant as defined by the Securities and Exchange Commission.
At February 25, 2003 there were 25,602,391 shares of common stock, $0.10 par
value, outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant's annual report to shareholders for the fiscal year
ended December 31, 2002 are incorporated by reference into Parts I and II.
Portions of the registrant's definitive proxy statement for the 2002 annual
meeting of shareholders to be held April 16, 2003 are incorporated by reference
into Part III.
TABLE OF CONTENTS
Part I
ITEM 1. BUSINESS
ITEM 2. PROPERTIES
ITEM 3. LEGAL PROCEEDINGS
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Part II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
ITEM 6. SELECTED FINANCIAL DATA
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
Part III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
ITEM 11. EXECUTIVE COMPENSATION
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
ITEM 14. CONTROLS AND PROCEDURES
Part IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
Schedule II Valuation and Qualifying Accounts
Signatures
Certifications
Exhibit Index
Exhibit 3.2 By-laws of INTERMET Corporation, as amended through December 10,
2002
Exhibit 10 Material Contracts
Exhibit 13 INTERMET's Annual Report to Shareholders
Exhibit 21 Subsidiaries of INTERMET
Exhibit 23 Consent of Independent Auditors
Exhibit 24 Power of Attorney
Exhibit 99.1 Certification of Chief Executive Officer
Exhibit 99.2 Certification of Chief Financial Officer
2
PART I
ITEM 1. BUSINESS
General
INTERMET is one of the largest independent producers of ductile iron, aluminum,
magnesium and zinc castings in the world. In addition, we provide machining and
tooling related to our casting business along with a range of other products and
services to the automotive and industrial markets. We specialize in the design
and manufacture of highly engineered, cast automotive components for the global
light truck, passenger car and heavy-duty vehicle markets. These products are
used in vehicle powertrain, chassis, electronic components, brakes and other
safety and structural parts.
INTERMET's focus is to supply cast products to a broad array of automotive and
industrial customers. Original equipment manufacturers ("OEMs") and Tier 1 and
Tier 2 suppliers increasingly rely on their suppliers to design and engineer
parts based on specific design parameters, including weight, size, cost and
performance criteria. In addition, OEMs, Tier 1 and Tier 2 suppliers look to
their suppliers to solve problems arising in the design and manufacturing
processes. We believe that we are well positioned to benefit from these trends
by providing a broad range of full-service capabilities, including advanced
design and engineering, casting, machining and sub-assembly.
Our ferrous metals products include ductile iron and gray iron castings and
their related machining operations. These castings include crankshafts,
camshafts, steering knuckles, wheel spindles, differential cases, brake calipers
and suspension control arms. Our light metals products include aluminum,
magnesium and zinc die-castings and their related machining operations. These
castings include engine covers, fluid containing covers, brackets, instrument
panel frames, connector housings, steering knuckles, airbag controller
enclosures and windshield wiper motor enclosures. We provide cast products used
by automotive OEMs, including DaimlerChrysler, Ford, General Motors, Volkswagen,
BMW, Honda and Toyota, and their leading suppliers throughout the world, such as
Delphi, Visteon, PBR Automotive, TRW, Continental, Knorr Bremse and Dana.
As of December 31, 2002, our Ferrous Metals segment had a total average straight
time available casting capacity of 654,000 tons, same as that in 2001. Our Light
Metals segment had a total average straight time available casting capacity of
72,000 tons as of December 31, 2002, down from 81,000 tons in 2001 due to the
closure of our Alexander City Foundry in December 2001.
Based on production, INTERMET's casting facilities, including Europe, operated
at an average annual capacity of 70% in 2002, 69% in 2001, and 106% in 2000.
We believe that our leadership in core markets positions us to capitalize on
domestic and international consolidation and OEM outsourcing trends. These
trends are driven, in part, by the OEMs' strategy to lower costs and maintain
quality by selectively awarding contracts to suppliers that have full service
capabilities and a significant global presence.
Our castings are used primarily in light trucks and passenger cars, as well as
in heavy trucks. Our castings also have municipal, marine and construction
applications. We specialize in safety-related parts, critical to vehicle
control, which meet our customers' exacting metallurgical, dimensional and
quality control standards.
We also manufacture precision-machined components for the automotive and
industrial markets.
3
INTERMET's annual reports on Form 10-K, quarterly reports on Form 10-Q, current
reports on Form 8-K, and all amendments to these reports filed or furnished
pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 are
available free of charge on or through our web site at http://www.intermet.com.
Alexander City Shutdown
In December 2001, we permanently closed our Alexander City, Alabama foundry.
Alexander City was included in the Light Metals segment. During 2002, we paid
all of the $0.4 million of severance accrued for as of December 31, 2001. See
additional discussion in the Management's Discussion and Analysis and in Note 6
to the Consolidated Financial Statements, Impairment of Assets and Shutdown,
which are included in INTERMET's 2002 annual report to shareholders and
furnished as Exhibit 13 to this filing.
Ironton Shutdown
In December 1999, we permanently closed our Ironton, Ohio foundry. Ironton was
included in the Ferrous Metals segment. During 2002, we incurred approximately
$0.2 million for workers' compensation claims, $0.3 million for health
insurance, and $0.1 million for environmental remediation. See additional
discussion in the Management's Discussion and Analysis and in Note 6 to the
Consolidated Financial Statements, Impairment of Assets and Shutdown, which are
included in INTERMET's 2002 annual report to shareholders and furnished as
Exhibit 13 to this filing.
Financial Information about Segments
Sales and net income for the Ferrous Metals segment in 2002 were $529.7 million
and $14.7 million, respectively, compared with $526.3 million and $8.4 million,
respectively, in 2001. Sales and net income in the Light Metals segment in 2002
were $271.6 million and $9.4 million, respectively, compared with sales and net
loss of $300.7 million and $3.3 million, respectively, in 2001. See additional
discussion in the Management's Discussion and Analysis and disclosure in Note 3
to the Consolidated Financial Statements, Reporting for Business Segments, which
are included in INTERMET's 2002 annual report to shareholders and furnished as
Exhibit 13 to this filing.
Products, Markets and Sales
We focus on value-added cast metal products, which we supply mainly to the
automotive market. In 2002, 2001 and 2000, approximately 88.8%, 88.7%, and 84.2%
of our sales, respectively, were attributable to the automotive market. Within
the automotive market, our products generally fall into four major categories:
- - Engine components such as camshafts, crankshafts, bedplates, front covers
and camcovers
- - Transmission components such as pump bodies and gear blanks
- - Chassis components such as steering knuckles, control arms, steering gear
housings, brake housings and supports, spindle carriers and damper forks
- - Axle components such as differential cases and carriers, bearing caps,
hubs, drums, spring seats and driveline yokes
INTERMET also manufactures a variety of products for the industrial and
appliance markets. In 2002, 2001, and 2000, approximately 11.2%, 11.3%, and
15.8% of our sales, respectively, were attributable to the industrial and
appliance markets.
Reportable segment sales by market for 2002 were as follows:
Market
----------------------------------------------------
Automotive Industrial Total
---------- ---------- -----
Reportable segment:
Ferrous metals segment 61.2% 3.8% 65.0%
Light metals segment 27.1% 6.2% 33.3%
Other 0.5% 1.2% 1.7%
---------------- --------------- -------------
Total 88.8% 11.2% 100.0%
================ =============== =============
4
Reportable segment sales by market for 2001 were as follows:
Market
----------------------------------------------------
Automotive Industrial Total
---------- ---------- -----
Reportable segment:
Ferrous metals segment 58.6% 3.8% 62.4%
Light metals segment 29.6% 6.1% 35.7%
Other 0.5% 1.4% 1.9%
---------------- --------------- -------------
Total 88.7% 11.3% 100.0%
================ =============== =============
Reportable segment sales by market for 2000 were as follows:
Market
----------------------------------------------------
Automotive Industrial Total
---------- ---------- -----
Reportable segment:
Ferrous metals segment 59.4% 1.7% 61.1%
Light metals segment 23.9% 8.2% 32.1%
Other 0.9% 5.9% 6.8%
---------------- --------------- -------------
Total 84.2% 15.8% 100.0%
================ =============== =============
INTERMET has a long-standing quality assurance program. All of our foundry
facilities that supply the automotive industry have QS-9000 and ISO-9001 or
ISO-9002 certification. In addition, we received various quality awards from our
customers during 2002, including:
- Ortech Quality Achievement - Quality and Delivery Objectives 2001
- GM Service Parts Operations - 100% On Time Delivery 2001
- Hitachi Supplier Performance Award 2001
- Best in Class Award 2002 for Magnesium Instrument Panel Frame
We primarily market our products through our own sales and customer service
staff. We use independent sales representatives in Europe and, to a limited
degree, in the United States. INTERMET's principal sales office is in Michigan.
We primarily produce to customer order and do not maintain any significant
inventory of finished goods not on order.
Our own sales staff acts as a liaison between our customers and our production
personnel. Through our product engineering group, we offer assistance at the
design stage of customer programs. We employ quality assurance representatives
and engineers who work with our customers' manufacturing personnel to detect and
avoid potential problems and to develop new product opportunities for us. In
addition to working with our customers' purchasing personnel, our product
engineers frequently work closely with our customers' design engineers and other
technical staff.
INTERMET supplies cast products to automotive OEMs directly or through Tier 1
and Tier 2 suppliers. Our cast products are included on approximately 200
vehicle models. Net sales to customers exceeding 10% of consolidated net sales,
and sales to other major customers, were as follows (as a percentage of
consolidated net sales):
Customer: 2002 2001 2000
------- ------- -------
DaimlerChrysler 20% 21% 18%
Delphi 13% 9% 8%
Ford 11% 11% 11%
General Motors 7% 6% 6%
Visteon 6% 6% 7%
PBR 5% 4% 3%
The loss of any of these customers or a substantial reduction in their purchases
would have a material adverse effect on us. Our six largest customers accounted
for approximately 62%, 57%, and 53% of consolidated net sales during 2002, 2001,
and 2000, respectively.
5
Net sales by market were as follows (as a percentage of consolidated net sales):
Percentage of Net Sales
-----------------------------------
2002 2001 2000
---- ---- ----
North American passenger cars and light trucks 78% 80% 75%
North American industrial and heavy vehicles 6% 5% 11%
European light and heavy duty vehicles 11% 11% 10%
Other 5% 4% 4%
------- ------- -------
Total 100% 100% 100%
======= ======= =======
Sales of ferrous metals castings were 465,000, 461,000, and 594,000 tons in
2002, 2001, and 2000, respectively. The increase in tons sold in 2002 compared
to 2001 is mainly due to the launch of new products. The decrease in tons sold
in 2001 compared to 2000 was mainly due to the downturn in the economy and
business that was lost because of the explosion that occurred in 2000 at our New
River foundry.
Sales of light metals castings were 41,000, 43,000, and 51,000 tons in 2002,
2001, and 2000, respectively. The decrease in tons sold in 2002 compared to 2001
is more than accounted for by a plant closure in the fourth quarter of 2001. The
decrease in tons sold in 2001 compared to 2000 was due to the downturn in the
economy.
Design, Manufacturing and Machining
We have a technical center in Lynchburg, Virginia that provides design and
engineering services to our customers. In addition, we provide technical support
to all of our plants worldwide. We furnish our customers with design support
using their own computer-aided design and engineering languages and our cast
metal process simulation software. Our design and engineering teams also assist
our customers in the initial stages of product creation and modification.
Our capabilities include finite element analysis, design optimization,
prototyping, modeling enhancements and testing. We use three-dimensional solid
modeling software in conjunction with rapid prototype development, among other
advanced computer-aided design techniques, to assist our customers in the
initial stages of product design and prototype creation. These techniques
greatly enhance our design and flexibility. In addition, we can substantially
reduce the time required to produce sample castings, depending on the complexity
of the products. INTERMET's goal is to continually improve product quality and
performance. We also strive to reduce costs by offering new product solutions
that reduce weight, use alternative materials or incorporate more efficient
manufacturing processes. INTERMET's product and manufacturing process
development work includes the development of new products and processes that can
broaden our overall product offerings and capabilities. We believe that our
advanced design and engineering capabilities serve as a significant competitive
advantage as our customers continue to outsource these critical activities to
their suppliers.
Our Ferrous Metals segment produces ductile iron and gray iron castings. Our
ferrous metal castings range from small products weighing approximately one
pound each to products weighing up to 150 pounds each. Ductile iron's use as a
higher strength substitute for gray iron and a lower-cost substitute for steel
has grown steadily. The ferrous metals cast production process involves melting
steel scrap and pig iron in a cupola melter or an electric furnace, adding
various alloys and pouring the molten metal into molds made primarily of sand.
The molten metal cools and solidifies in the molds. The molds are then broken
apart and the castings are removed.
Our Light Metals segment produces die-castings of aluminum, magnesium and zinc,
which are lower weight alternative metals. Our light metal castings range from
small products weighing less than one pound each to products weighing up to 50
pounds each. Die casting is a metal component casting process in which molten
aluminum, magnesium or zinc is introduced into metal dies and solidified.
Pressure-counter-pressure casting (PCPC TM) is a casting method in which molten
metal, usually aluminum, is introduced into a permanent die cavity with
low-pressure gas applied to the metal in a sealed furnace. Solidification of the
metal is controlled by extensive cooling lines placed throughout the die cavity
and by the precise application of pressure.
Customers usually specify the properties their castings are to embody, such as
hardness and strength, and we determine how best to meet those specifications.
Constant testing and monitoring of the casting process is necessary to maintain
the quality and performance consistency of the castings. Electronic testing and
monitoring equipment, including x-ray, real-time radioscopy, ultrasonic,
magnetic-particle and spectroscopy, is used extensively in grading scrap metal,
analyzing molten metal and testing castings. We also use testing equipment and
procedures to provide particular tests for our castings as requested by
customers.
6
Most castings require machining before they can be put to their ultimate use.
This machining may include drilling, boring, milling, threading or cutting
operations. Many customers provide their own machining for castings or have them
machined by third parties. We operate two facilities, one in Midland, Georgia
and one in Racine, Wisconsin, that machine castings produced by us and by
others. We also own a precision machining company in Elk Grove Village,
Illinois. In addition, most of our light metals casting plants have machining
integral in the casting operation. We also contract with other companies to
machine castings that we produce, before the castings are shipped to customers.
Raw Materials
Steel scrap is the primary raw material INTERMET uses to manufacture ferrous
metals castings. We purchase steel scrap from numerous sources, generally
regional scrap brokers, using a combination of spot market purchases and
short-term contract commitments. We have no material long-term contractual
commitments with any steel scrap supplier. The cost of steel scrap is subject to
fluctuations. We have contractual arrangements with many of our major customers
that allow us to adjust our casting prices to reflect such fluctuations.
In producing die cast light metals castings, the primary raw material we use is
secondary aluminum ingot. We purchase aluminum using spot market purchases and
short-term contract commitments. We have no material long-term contractual
commitments with any aluminum suppliers. The cost of aluminum ingot is subject
to fluctuations. We have contractual arrangements with many of our major
customers that allow us to adjust our casting prices to reflect such
fluctuations. For PCPC TM, the primary raw material is primary aluminum T-sow
bar. This is obtained from a primary smelting source. We have contractual
arrangement with our major customers that track the price to a published index
and allow us to adjust our casting prices to reflect such fluctuations.
We have contractual arrangements with some of our suppliers, which expire at
various times through 2003, for the purchase of various materials, other than
steel scrap or secondary aluminum ingot, used in the manufacturing process.
These contracts provide some limited protection against price increases of raw
materials. Other than as noted above, we do not have specific arrangements in
place to adjust casting prices for fluctuations in the prices of alloys and
other materials.
Cyclicality and Seasonality
Although most of our products are generally not affected by year-to-year
automotive style changes, model changes may have a significant impact on sales.
In addition, the inherent cyclicality of the automotive industry has affected
our sales and earnings during periods of slow economic growth or recession. Our
third and fourth quarter sales are usually lower than first and second quarter
sales due to plant closings by automakers for holidays, vacations and model
changeovers.
Backlog
Most of INTERMET's business involves supplying all or a portion of the
customer's annual requirements stated in blanket purchase orders. Customers
typically issue firm releases and shipping schedules on a monthly basis. Our
backlog at any time generally consists only of the orders that have been
released for shipment.
Competition
INTERMET competes with many other foundries domestically and internationally.
Some of these foundries are owned by major users of ferrous castings. For
example, the three largest automobile manufacturers in North America, which are
among our largest customers, operate their own foundries. However, they also
purchase a significant number of castings from INTERMET and other companies, and
there is a trend toward increased outsourcing by these three automobile
manufacturers. Our castings also compete, to some degree, with malleable iron
castings, other metal castings and steel forgings and stampings.
The machining industry is highly fragmented and competitive. As in the foundry
industry, major purchasers of machined components often have significant
in-house capabilities to perform their own machining work.
INTERMET competes primarily on the basis of product quality, engineering,
service and price. We emphasize our ability to produce complex products in order
to compete for value-added castings.
7
Research and Development
INTERMET conducts process and product development programs for both its ferrous
metals and light metals products, principally at a technical center in
Lynchburg, Virginia. Current research and testing projects encompass both new
manufacturing processes and product development. The research foundry has a
self-contained melting and molding facility with extensive metallurgical,
physical and chemical testing capabilities. The work on new manufacturing
processes focuses on ways to lower costs and improve quality. Product
development work includes projects to extend the performance range for existing
iron castings such as austempering, which enhances the strength and toughness of
iron. In addition, we are currently working to develop new materials, improve
product manufacturing processes and improve characterization of material
properties. We directly expensed $1.3 million , $1.7 million, and $1.5 million
in 2002, 2001, and 2000, respectively, for basic research and development.
Employees
At January 31, 2003, we employed 5,934 persons, including 5,057 and 877
employees and workers in North America and Europe, respectively. Of the
personnel employed in North America, 4,147 were hourly manufacturing personnel
and the remainder were clerical, sales and management personnel. Of the
personnel employed in Europe, 730 were hourly manufacturing personnel.
Foreign and Domestic Operations and Export Sales
Revenues and identifiable assets for INTERMET's foreign and domestic operations
for 2002, 2001, and 2000 were as follows (in thousands of dollars):
For the year ended December 31,
-------------------------------------------
2002 2001 2000
---- ---- ----
Net sales:
North America $726,982 $753,187 $ 943,371
Europe 87,950 89,986 95,473
-------- -------- ----------
Total $814,932 $843,173 $1,038,844
======== ======== ==========
As of December 31,
-------------------------------------------
2002 2001 2000
---- ---- ----
Identifiable assets in:
North America $683,775 $764,903 $ 841,016
Europe 80,323 75,636 77,780
-------- -------- ----------
Total $764,098 $840,539 $ 918,796
======== ======== ==========
Sales by geographic locations of customers for 2002, 2001, and 2000 were as
follows (in thousands of dollars):
For the year ended December 31,
-------------------------------------------
2002 2001 2000
---- ---- ----
Sales to unaffiliated customers:
North America $718,871 $746,924 $929,284
Europe 89,879 93,854 106,387
Other International 6,182 2,395 3,173
-------- -------- ----------
Total $814,932 $843,173 $1,038,844
======== ======== ==========
Executive Officers of the Registrant
Executive officers are elected annually by the Board of Directors at its meeting
that immediately follows our annual meeting of shareholders. An executive
officer holds office until his or her successor is elected and qualified, or
until his or her death, resignation or removal.
8
The executive officers of INTERMET as of February 25, 2003 along with their ages
and principal positions with INTERMET, are as follows:
Name (Age) Principal Position(s)
---------- ---------------------
John Doddridge (62) Chairman of the Board and Chief
Executive Officer
Gary F. Ruff (51) President and Chief Operating Officer
Robert E. Belts (53) Vice President -- Finance and Chief
Financial Officer
Todd A. Heavin (41) Vice President, Ferrous Metals
Jesus M. Bonilla (55) Vice President, Light Metals
Alan J. Miller (54) Vice President, General Counsel and
Assistant Secretary
Bytha Mills (47) Vice President, Administration
Thomas E. Prucha (53) Vice President, Technical Services
Laurence Vine-Chatterton (53) Vice President and President --
INTERMET Europe
Terry C. Graessle (50) Vice President, Sales and Marketing
Mr. Doddridge became our Chairman of the Board and Chief Executive Officer of
INTERMET in 1994. From November 1992 until November 1994, Mr. Doddridge was Vice
Chairman and Chief Executive Officer of Magna International, Inc., a supplier of
motor vehicle parts. From 1989 to 1992 he served as President of North American
Operations of Dana Corporation, a motor vehicle parts manufacturer, and before
then he served as President of Hayes-Dana Inc., a subsidiary of Dana
Corporation.
Dr. Ruff was elected as President and Chief Operating Officer of INTERMET in
December 2002. He joined INTERMET as Vice President -- Technical Services in
June 1999 and was named Executive Vice President - Technical Services in 2000.
Prior to joining INTERMET, he served in a variety of positions at CMI
International and its successor company, Hayes Lemmerz International, Inc., both
automotive parts suppliers. He served as President of North American Aluminum
Wheels -- Hayes Lemmerz International and as Corporate Vice President of Hayes
Lemmerz International, Inc. from February 1999 to May 1999. He was the Chief
Technical Officer, Executive Vice President and Director of CMI International,
Inc. from February 1994 until Hayes-Lemmerz purchased CMI in January 1999.
Mr. Belts joined INTERMET as Vice President -- Finance and Chief Financial
Officer in August of 2002 following 14 years with Detroit Diesel Corporation, a
manufacturer of heavy-diesel engines. He served as Senior Vice President of
Finance and Chief Financial Officer of Detroit Diesel from March 1998 to July
2002 and as Vice President of Finance and Controller from January 1995 to
February 1998 before joining INTERMET.
Mr. Heavin joined INTERMET as a Group Vice President in June of 2000 and was
named Group Vice President of Ferrous Metals in September 2002. Prior to coming
to INTERMET, Mr. Heavin was a Manufacturing Manager for Delphi's Energy and
Chassis Division. Prior to that he was employed by United Technologies
Automotive for six years as plant manager of the Holland, Michigan plant and
subsequently as a general manager in the Interiors group.
Mr. Bonilla joined INTERMET as Group Vice President of Light Metals in September
2002. Prior to joining INTERMET, he served as Group Vice President of
Manufacturing and General Manager, Mexico Operations of Exemplar Manufacturing
Company, a supplier of automotive wire harnesses. He also served as Vice
President, Operations, at the North American Aluminum Wheel - Hayes Lemmerz
International, Inc. His early career included operation management positions
with Handy & Harman Automotive Group in Laredo, Texas, and Masco Corporation in
Mexicali, Mexico.
Mr. Miller joined INTERMET in July 1998 as Corporate General Counsel and was
named Vice President and General Counsel in August 1999. He served as Vice
President, General Counsel and Secretary at Libbey-Owens-Ford Co., an automotive
parts supplier, from February 1987 to July 1998.
Ms. Mills joined INTERMET in February 1997 as Manager of Investor Relations and
was promoted to Director, Corporate Affairs in March 1999 and Vice President,
Administration in December 2002. Prior to joining INTERMET, Ms. Mills served as
Human Resources Manager, Accounting Supervisor and in other positions at Dana
Corporation.
Mr. Prucha joined INTERMET in October 1999 as Director, Process Research and
Development and was promoted to Vice President, Technical Services in December
2002. Prior to joining INTERMET, Mr. Prucha served as Vice President of
9
Technology of CMI International for 10 years. He has nearly 30 years of
experience in the metal-casting industry, 20 of which were at CMI.
Mr. Vine-Chatterton joined INTERMET in January 1999 as a Vice President of
INTERMET and President of INTERMET Europe. Before coming to INTERMET, he was a
divisional Finance Director of T&N PLC, UK, an automotive parts supplier, from
June 1996. Mr. Vine-Chatterton was a divisional Finance Director of Caradon PLC,
UK, an international supplier to building and home improvement industries, from
January 1994 until 1996.
Mr. Graessle joined INTERMET in March 2001 as Vice President -- Sales and
Marketing. Before coming to INTERMET, Mr. Graessle was Vice President of the
Lighting and Wiper Products Group at Federal Mogul Corporation following its
acquisition of Cooper Automotive. Prior to that, he was with the Automotive
Group of Cooper Industries for 9 years serving as Vice President of Sales and
Marketing. Previous to Cooper, Mr. Graessle was with Arvin Industries for 13
years, achieving the position of Sales Director.
ITEM 2. PROPERTIES
At December 31, 2002, INTERMET operated or had an ownership interest in the
following properties:
- - seven ductile iron foundries
- - two ductile and gray iron foundries
- - one aluminum and zinc die-cast foundry
- - one aluminum pressure-counter-pressure castings (PCPC TM) foundry
- - two aluminum die-cast foundries
- - two magnesium die-cast foundries
- - two precision-engineered, close-tolerance, aluminum die-cast foundries
- - two machining and assembly facilities
- - one precision machining facility
- - one research and development foundry
- - one technical center
The following provides information about INTERMET's 20 domestic and
international manufacturing locations and the types of products produced at each
location:
Name of Plant Location Type of Products
- ------------- -------- ----------------
Ferrous Metals Segment:
INTERMET Archer Creek Foundry Lynchburg, Virginia Ductile iron castings
INTERMET Columbus Foundry Columbus, Georgia Ductile iron castings
INTERMET Columbus Machining Midland, Georgia Machined and assembled components
INTERMET Decatur Foundry Decatur, Illinois Ductile iron castings
INTERMET Havana Foundry Havana, Illinois Ductile iron castings
INTERMET Hibbing Foundry Hibbing, Minnesota Ductile iron castings
INTERMET Neunkirchen Foundry Neunkirchen, Germany Ductile iron castings
INTERMET New River Foundry Radford, Virginia Ductile iron castings
INTERMET Radford Foundry Radford, Virginia Ductile and gray iron castings
INTERMET Ueckermunde Foundry Ueckermunde, Germany Ductile and gray iron castings
Light Metals Segment:
INTERMET Hannibal Plant Hannibal, Missouri Magnesium die-castings
INTERMET Jackson Plant Jackson, Tennessee Precision-engineered, close-tolerance, aluminum
die-castings
INTERMET Minneapolis Plant Minneapolis, Minnesota Precision-engineered, close-tolerance, aluminum
die-castings
INTERMET Monroe City Plant Monroe City, Missouri Aluminum and zinc die-castings
INTERMET Palmyra Plant Palmyra, Missouri Magnesium die-castings
INTERMET Pulaski Plant Pulaski, Tennessee Aluminum die-castings
INTERMET Racine Machining Racine, Wisconsin Machined and assembled components
INTERMET Racine Plant Racine, Wisconsin Aluminum die-castings
INTERMET Stevensville Plant Stevensville, Michigan Aluminum pressure-counter-pressure castings (PCPC TM)
Other:
Frisby P.M.C., Incorporated Elk Grove Village, Illinois Precision machined components
10
We also have a 50% equity interest in Fundicao Nodular, S.A., an iron castings
company in Porto, Portugal. The company operates its business under the name
"INTERMET Portcast Foundry".
All of INTERMET's manufacturing locations are owned, except the Frisby P.M.C.
facility, which is leased, and the Jackson Plant and Columbus Foundry
facilities, which are leased pursuant to a financing arrangement utilizing
industrial revenue bonds. All of INTERMET's owned properties are subject to
liens securing bank borrowing. For further information on debt, see Note 8 to
the Consolidated Financial Statements, Debt, which is included in INTERMET's
2002 annual report and furnished as Exhibit 13 to this filing.
INTERMET also owns a research and development foundry and leases a technical
center, both located in Lynchburg, Virginia. The technical center provides
advanced design and engineering services to our customers. In addition, we
provide technical support to all of our cast metals and machining plants
worldwide.
ITEM 3. LEGAL PROCEEDINGS
In May 1999, we voluntarily notified the Ohio Environmental Protection Agency
("OEPA") of a breakdown in certain pollution control equipment at our Ironton,
Ohio foundry. Due to an oversight, our notification was not considered timely
under the applicable rules and regulations. The equipment was subsequently
repaired and became operational until the Ironton facility was closed in March
2000. Although no notice of violation has been issued by OEPA with respect to
this matter, it is possible that OEPA may pursue fines or penalties for this
violation. Although we cannot predict the amount of any potential fines or
penalties, we do not believe that they would be material to our business or
financial condition.
On March 5, 2000 we suffered a catastrophic accidental explosion and fire at our
New River Foundry, located in Radford, Virginia. Three employees were fatally
injured and others were injured, several seriously. On March 2, 2002 the
representatives of the three deceased employees, and three of the injured
employees, filed six separate lawsuits seeking damages from us and other
defendants in the Circuit Court for the City of Radford, Virginia. It is also
possible that one or more of the other defendants in these cases might assert
cross-claims against us. On December 11, 2002, five of the six cases were
dismissed by the court. We have both primary and excess liability insurance
policies covering potential liability to employees and others and believe that
we are adequately insured against any likely liability for the deaths or
injuries arising out of this incident. However, if we were held to be liable in
these cases, and if our insurance policies did not provide coverage for the
damages, the amounts that could be incurred could be material.
On March 14, 2002, we entered into a Consent Order with the U.S. Environmental
Protection Agency ("USEPA"), which will require investigation of the nature and
extent of any hazardous waste disposed of at our Radford, Virginia facilities.
We have entered into this Consent Order in connection with the USEPA's
Corrective Action Program. The Corrective Action Program is being undertaken on
a nationwide basis by USEPA pursuant to the Resource Conservation and Recovery
Act of 1976. The Corrective Action Program requires facilities that have
historically generated or handled hazardous waste to determine whether those
activities have or could adversely affect groundwater or adversely affect human
health. Because we historically disposed of waste material at this site, it is
possible that fines or penalties could be assessed, or that remedial action
could be required, with respect to that on-site disposal. At this time we cannot
predict the amount of potential fines or penalties or the cost of remedial
action, if any.
INTERMET is also a party to a number of other legal proceedings associated with
environmental, employment, commercial, product liability and other matters in
the ordinary course of its business. We do not believe that such pending or
threatened legal proceedings to which we are a party, or to which any of our
property is subject, will have a material adverse effect on our consolidated
financial position, results of operations or liquidity, taken as a whole. It is
possible, however, that future results of operations for any particular
quarterly or annual period could be materially affected by changes in our
assumptions related to these proceedings. For further discussion, see
Management's Discussion and Analysis and Note 11 to the Consolidated Financial
Statements, Commitments and Contingencies, which are included in INTERMET's 2002
annual report to shareholders, furnished as Exhibit 13 to this filing.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders of INTERMET during the
fourth quarter of the fiscal year covered by this report.
11
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
For the high and low stock prices for each of the calendar quarters for the last
two years, see Note 16 to the Consolidated Financial Statements, Quarterly Data
and Share Information, which is included in INTERMET's 2002 annual report to
shareholders and furnished as Exhibit 13 to this filing.
INTERMET's common stock, $0.10 par value, is traded on the Nasdaq National
Market under the symbol "INMT" and had a closing price of $4.13 on February 25,
2003. Also on February 25, 2003, there were approximately 483 holders of
INTERMET's common stock.
During 2002, 2001, and 2000, INTERMET declared dividends of approximately $4.1
million each year, ($0.04 per share per quarter). During 2002, 2001 and 2000,
INTERMET paid dividends of approximately $4.1 million, $3.2 million, and $4.1
million, respectively. Under some of our loan agreements, we are subject to
restrictions on the payment of dividends. As of December 31, 2002, approximately
$5.0 million, per fiscal year, of our retained earnings is available for the
payment of dividends under those agreements. For further discussion of debt, see
Management's Discussion and Analysis and Note 8 to the Consolidated Financial
Statements, Debt, which are included in INTERMET's 2002 annual report to
shareholders and furnished as Exhibit 13 to this filing.
INTERMET did not sell unregistered securities within the past three years.
ITEM 6. SELECTED FINANCIAL DATA
Year Ended December 31 1998 1999 2000 2001 2002
---------------------- ---- ---- ---- ---- ----
STATEMENT OF OPERATIONS DATA (in thousands of
dollars)
Net sales (a)(b)(c) $841,598 $956,832 $1,038,844 $843,173 $814,932
Operating profit (d) 75,649 62,161 88,692 12,591 36,701
Net income (loss) (d)(e)(f) 40,989 36,377 40,908 (8,703) 9,003
SHARE DATA (in thousands, except per share data)
Net income (loss) per common share - diluted $1.58 $1.42 $1.61 $(0.34) $0.35
Cash dividends declared per common share (g) $0.16 $0.16 $0.16 $0.16 $0.16
Weighted average common shares outstanding -
diluted 25,947 25,571 25,438 25,359 25,878
BALANCE SHEET DATA (in thousands of dollars)
Total assets (a)(b)(c) $584,015 $957,292 $918,796 $840,539 $764,098
Total debt (a)(f) 163,101 455,040 399,166 363,422 280,103
Shareholders' equity 217,005 242,377 279,410 253,280 257,569
(a) In December 1999, we acquired all of the issued and outstanding stock of
Diversified Diemakers, Inc., a Missouri manufacturer of magnesium die-cast
automotive components, and of Ganton Technologies, Inc., a supplier of
die-cast aluminum components to the automotive industry. This partly
accounts for the increase in net sales, total assets and total debt in
1999.
(b) In March 2000, we experienced an explosion at our New River Foundry causing
a loss in business when the automotive industry was at an all time peak as
described in Management's Discussion and Analysis and Note 18 to the
Consolidated Financial Statements, Insurance Claims, which are included in
INTERMET's 2002 annual report to shareholders and furnished as Exhibit 13
to this filing. Without this incident, the net sales and total assets in
2000 would have been higher.
12
(c) In October 2000, we sold our interest in Iowa Mold Tooling Co. Inc. as
described in Management's Discussion and Analysis and Note 4 to the
Consolidated Financial Statements, Dispositions, which are included in
INTERMET's 2002 annual report to shareholders and furnished as Exhibit 13
to this filing. Without this transaction, the net sales and total assets in
2000 would have been higher.
(d) We recorded pretax asset impairment charges and / or shutdown costs of
$13.5 million, $7.5 million, and $18.5 million in 2001, 2000 and 1999,
respectively. These have negative impact on our operating profit and net
income. For further discussion about asset impairment and shutdown costs,
see Management's Discussion and Analysis and Note 6 to the Consolidated
Financial Statements, Impairment of Assets and Shutdown, which are included
in INTERMET's 2002 annual report to shareholders and furnished as Exhibit
13 to this filing.
(e) On January 1, 2002, we adopted Statement of Financial Accounting Standards
("SFAS") No. 142, "Goodwill and Other Intangible Assets". Under this
statement, goodwill is no longer amortized but is subject to annual
impairment tests. As required under SFAS No. 142, we wrote off negative
goodwill of $481,000, net of taxes, as a cumulative effect of a change in
accounting principle. Goodwill amortization, net of taxes, was $5.3
million, $5.3 million, $2.8 million, and $2.7 million in 2001, 2000, 1999,
and 1998, respectively.
(f) In June 2002, we completed a senior note offering of $175 million. The net
proceeds of the senior note offering were used to pay off the remaining
balance of our bank term loan ($161.7 million) and for working capital
purposes. Unamortized financing costs of $927,000 were written off as a
result of the extinguishment of debt. The net of tax amount of $603,000 was
reported as extraordinary item. For further discussion about the debt, see
Management's Discussion and Analysis and Note 8 to the Consolidated
Financial Statements, Debt, which are included in INTERMET's 2002 annual
report to shareholders and furnished as Exhibit 13 to this filing.
(g) In 2001, $0.16 per share dividends were declared; however, the fourth
quarter $0.04 per share dividend was paid on January 2, 2002.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The information included under the heading "Management's Discussion and Analysis
of Financial Condition and Results of Operations" is incorporated by reference
from INTERMET's 2002 annual report to shareholders, which is furnished as
Exhibit 13 to this filing.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS
The information included under the "Quantitative and Qualitative Disclosures
about Market Risks" section of the "Management's Discussion and Analysis of
Financial Condition and Results of Operations" is incorporated by reference from
INTERMET's 2002 annual report to shareholders, which is furnished as Exhibit 13
to this filing.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The consolidated financial statements of INTERMET and the report of the
independent auditors included in INTERMET's 2002 annual report to shareholders
are furnished as Exhibit 13 to this filing
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None
13
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information contained under the headings "Information about Nominees for
Director" in INTERMET's definitive proxy statement for its annual meeting of
shareholders to be held April 16, 2003 is incorporated by reference into this
filing. Pursuant to Instruction 3 to Paragraph (b) of Item 401 of Regulation
S-K, information relating to the executive officers of INTERMET is included in
Item 1 of this filing.
ITEM 11. EXECUTIVE COMPENSATION
The information contained under the headings "Executive Compensation",
"Compensation of Directors", "Employment Agreements and Change in Control
Arrangements", "Compensation Committee Report on Executive Compensation" and
"Shareholder Return Performance Graph" in INTERMET's definitive proxy statement
for its annual meeting of shareholders to be held April 16, 2003 is incorporated
by reference into this filing.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS
The information contained under the heading "Voting Securities and Principal
Holders" in INTERMET's definitive proxy statement for its annual meeting of
shareholders to be held April 16, 2003 is incorporated by reference into this
filing.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information contained under the heading "Relationships and Related
Transactions" in INTERMET's definitive proxy statement for its annual meeting of
shareholders to be held April 16, 2003 is incorporated by reference into this
filing.
ITEM 14. CONTROLS AND PROCEDURES
(a) We have conducted an evaluation of our disclosure controls and procedures,
as such term is defined under Rules 13a-14(c) and 15d-14(c) of the
Securities Exchange Act of 1934, as amended, within 90 days of the filing
date of this report. Based on our evaluation, our principal executive
officer and principal financial officer have concluded that our disclosure
controls and procedures are effective to ensure that information required
to be disclosed by us is recorded, processed, summarized and reported
within the required time periods.
(b) There have been no significant changes in our internal controls or in other
factors that could significantly affect these controls subsequent to the
date of the evaluation referenced in paragraph (a) above.
14
PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
1. Financial Statements
The following consolidated financial statements of INTERMET and its
subsidiaries contained in INTERMET's 2002 annual report to shareholders are
furnished as Exhibit 13 to this filing:
- Consolidated Statements of Operations for the Years Ended December 31,
2002, 2001, and 2000
- Consolidated Statements of Comprehensive Income for the Years Ended
December 31, 2002, 2001, and 2000
- Consolidated Balance Sheets at December 31, 2002 and 2001
- Consolidated Statements of Cash Flows for the Years Ended December 31,
2002, 2001, and 2000
- Consolidated Statements of Shareholders' Equity for the Years Ended
December 31, 2002, 2001, and 2000
- Notes to Consolidated Financial Statements
2. Financial Statement Schedules
The following consolidated financial statement schedule for INTERMET is
included as part of this filing. All other financial statement schedules
have been omitted because they are not applicable, or the information
required is disclosed under Item 8 of this filing.
INTERMET CORPORATION
(CONSOLIDATED)
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
(IN THOUSANDS OF DOLLARS)
ADDITIONS
-------------------------------
BALANCE AT CHARGED TO CHARGED TO BALANCE AT
BEGINNING OF COSTS AND OTHER END OF
DESCRIPTION PERIOD EXPENSES ACCOUNTS DEDUCTIONS PERIOD
- ----------------------------------------- ------------ ------------ ------------ ------------ ------------
YEAR ENDED DECEMBER 31, 2002:
Allowance for returns and doubtful
accounts (a) $10,727 $(1,498) (b) $- $ - $9,229
Inventory reserve (c) 7,758 (1,120) - - 6,638
Deferred tax asset valuation 50 - - - 50
allowance
YEAR ENDED DECEMBER 31, 2001:
Allowance for returns and doubtful
accounts (a) $9,451 $1,276 (b) $- $ - $10,727
Inventory reserve (c) 6,855 903 - - 7,758
Deferred tax asset valuation 50 - - - 50
allowance
YEAR ENDED DECEMBER 31, 2000:
Allowance for returns and doubtful
accounts (a) $7,426 $2,025 (b) $- $ - $9,451
Inventory reserve (c) 9,312 (2,457) - - 6,855
Deferred tax asset valuation 3,728 - (1,975) (d) - 50
allowance
(1,703) (e)
(a) Reflected as reduction of trade accounts receivable on the consolidated
balance sheet
(b) Net effect of amounts charged to expense less actual returns and write-offs
(c) Reflected as reduction of inventories on the consolidated balance sheet
(d) Reversed valuation allowance, and related deferred tax asset, for net
operating loss carryforwards of the Ironton facility because the facility
was closed down and these loss carryforwards will never be utilized
(e) Reversed valuation allowance for foreign tax credit carryforwards which
expired
15
3. Reports on Form 8-K
On December 11, 2002, we filed a report on Form 8-K containing a press
release related to the appointment of our President and Chief Operating
Officer.
4. Exhibits
The following exhibits are filed pursuant to Item 601 of Regulation S-K:
Exhibit
Number Description of Exhibit Method of Filing
- ------ ---------------------- ----------------
2.1 Agreement and Plan of Merger among INTERMET, I M Acquisition Included as Exhibit 4 to INTERMET Form 8-K
Corp., and Sudbury, Inc. dated November 18, 1996 filed November 25, 1996
2.2 Asset Purchase Agreement Between INTERMET Corporation and Included as Exhibit 1 to INTERMET Form 8-K
Quadion Corporation for the purchase of the assets of Tool filed January 14, 1999
Products, Inc. dated December 2, 1998
2.3 Stock Purchase and Sale Agreement Between INTERMET Corporation, Included as Exhibit 99.1 to INTERMET Form 8-K
Gantec II, LLC, JJM, LLC, and Cerberus Institutional Partners, filed December 30, 1999
L.P. for the purchase of the stock of Diversified Diemakers,
Inc. dated November 16, 1999
2.4 Contents of omitted schedules and exhibits to the Stock Included as Exhibit 99.2 to INTERMET Form 8-K
Purchase and Sale Agreement for the purchase of the stock of filed December 30, 1999
Diversified Diemakers, Inc.
2.5 Stock Purchase and Sale Agreement Between INTERMET Corporation, Included as Exhibit 99.3 to INTERMET Form 8-K,
Gantec II, LLC and JJM, LLC for the purchase of the stock of filed December 30, 1999
Ganton Technologies, Inc. dated November 16, 1999
2.6 Contents of omitted schedules and exhibits to the Stock Included as Exhibit 99.4 to INTERMET Form 8-K
Purchase and Sale Agreement for the purchase of the stock of filed December 30, 1999
Ganton Technologies, Inc.
3.1 Amended and Restated Articles of Incorporation of INTERMET Included as Exhibit 4.1 to INTERMET Form S-3
Registration Statement filed June 3, 1992
3.2 By-laws of INTERMET, as amended through December 10, 2002 Included in this report
4.1 Promissory Note of Lynchburg Foundry Company, dated December 1, *
1973, payable to Industrial Development Authority of the City
of Lynchburg, Virginia in the original principal amount of
$4,400,000
4.2 Guaranty Agreement, dated December 1, 1973, by and between The *
Mead Corporation and the Industrial Development Authority of
the City of Lynchburg, Virginia
4.3 Trust Indenture, dated December 1, 1973, by and among *
Industrial Development Authority of the City of Lynchburg,
Virginia, Lynchburg Foundry Company and United Virginia Bank,
as trustee
4.4 Promissory Notes of Lynchburg Foundry Company, dated June 1, *
1976, payable to Industrial Development Authority of the City
of Lynchburg, Virginia, in the original principal amounts of
$2,700,000, $1,000,000, $550,000 and $550,000, respectively
4.5 Guaranty Agreement, dated June 1, 1976, of The Mead Corporation *
in favor of Industrial Development Authority of the City of
Lynchburg, Virginia
4.6 Trust Indenture, dated June 1, 1976, by and among Industrial *
Development Authority of the City of Lynchburg, Virginia,
Lynchburg Foundry Company and United Virginia Bank, as
16
Exhibit
Number Description of Exhibit Method of Filing
- ------ ---------------------- ----------------
trustee, with respect to Pollution Control Revenue Bonds
(Mead-Lynchburg Foundry Project), Series 1976, Series 1976A,
Series 1976B and Series 1976C
4.7 Loan Contract, dated September 28, 1988, by and between *
Columbus Neunkirchen Foundry GmbH and Saarlandische
Investitionskreditbank, relating to a loan in the original
principal amount of DM 740,000
4.8 Loan Contract, dated March 1, 1989, by and between Columbus *
Neunkirchen Foundry GmbH and Saarlandische
Investitionskreditbank, relating to a loan in the principal
amount of DM 2,000,000
4.14 (a) $300,000,000 Conformed Five-Year Credit Agreement, dated Included as Exhibit 4.14(a) to INTERMET Form
November 5, 1999, as amended through the fourth Amendment dated 10-Q filed August 14, 2001
as of July 17, 2001, by and among INTERMET, The Bank of Nova
Scotia as lender, administrative agent and collateral agent,
and the various lenders named therein
4.17 (a) Final Private Placement Memorandum for $35,000,000 Development *
Authority of Columbus Georgia Variable Rate Limited Obligation
Revenue Bonds (Columbus Foundry, L.P. Project, Series 1999)
4.17 (b) Master Indenture Trust dated as of December 1, 1999,by and *
between Development Authority of Columbus, Georgia, as issuer,
and Harris Trust and Savings Bank, as trustee
4.17 (c) Series 1999A Supplement dated as of December 1, 1999 to Master *
Indenture Trust dated December 1, 1999 by and between
Development Authority of Columbus, Georgia, as issuer, and
Harris Trust and Savings Bank, as trustee
4.18 (a) Shareholder Protection Rights Agreement dated as of October 6, Included as Exhibit 4 to INTERMET Form 8-K
1995 between INTERMET and Trust Company Bank, as Rights Agent filed October 11, 1995
4.18 (b) Amendment No. 1 dated October 16, 1997 to the Shareholder Included as Exhibit 4 to INTERMET Form 8-A12G/A
Protection Rights Agreement dated October 6, 1995 between filed October 20, 1997
INTERMET and Trust Company Bank, as Rights Agent
4.19 (a) Indenture dated as of June 13, 2002 among INTERMET Corporation, Included as Exhibit 4.1 to INTERMET Form S-4
U.S. Bank National Association and the guarantors named therein Registration Statement No. 333-97245 filed July
29, 2002
4.19 (b) Registration Rights Agreement dated as of June 13, 2002 among Included as Exhibit 4.3 to INTERMET Form S-4
INTERMET Corporation and the Guarantors named therein, and Registration Statement No. 333-97245 filed July
Deutsche Bank Securities Inc., Banc of America Securities LLC, 29, 2002
Scotia Capital (USA) Inc., Sun Trust Capital Markets, Inc.,
Banc One Capital Markets, Inc., Comerica Securities, Inc., and
ABN AMRO Incorporated
4.19 (c) Terms of 9 3/4% Senior Notes of $175,000,000 due 2009 Included as INTERMET Form S-4A Registration
Statement No. 333-97245 filed August 13, 2002
5.1 Opinion of Foley & Lardner (Re: INTERMET Registration Statement Included as Exhibit 5.1 to INTERMET Form S-4
on Form S-4 regarding of 9 3/4% Senior Notes of $175,000,000 Registration Statement No. 333-97245 filed July
due 2009) 29, 2002
10.1 (a) INTERMET Corporation Key Individual Stock Option Plan adopted Included as Exhibit 10.1 to INTERMET
April 25, 1984 registration statement on Form S-14, File No.
2-90815
17
Exhibit
Number Description of Exhibit Method of Filing
- ------ ---------------------- ----------------
10.1 (b) Amendment No. 1 dated as of August 4, 1988 to the INTERMET Included as Exhibit 10.2 to INTERMET Form 10-K
Corporation Key Individual Stock Option Plan for the year ended December 31, 1988
10.1 (c) Amendment No. 2 dated October 27, 1988 to the INTERMET Included as Exhibit 10.3 to INTERMET Form 10-K
Corporation Key Individual Stock Option Plan for year ended December 31, 1988
10.2 INTERMET Corporation Executive Stock Option and Incentive Award Included as Exhibit 4 to INTERMET Form S-8
Plan Registration Statement No. 33-59011 filed May
2, 1995
10.2 (a) INTERMET Corporation Restricted Share Unit Award Plan effective Included as Exhibit 10.2(a) to INTERMET Form
February 1, 2001 10-K for the year ended December 31, 2000
10.2 (b) INTERMET Corporation 2000 Executive Stock Option and Incentive Included as Exhibit 4 to INTERMET Form S-8
Award Plan effective April 13, 2000. Registration Statement No. 333-41208 filed July
12, 2000
10.3 INTERMET Corporation Deferred Compensation Plan effective Included as Exhibit 10.3 to INTERMET Form 10-K
December 1, 1999 for the year ended December 31, 2000
10.7 (a) INTERMET Corporation Salaried Employees Severance Plan Included as Exhibit 10.16(a) to INTERMET Form
effective as of October 1, 1993 10-K for the year ended December 31, 1993
10.7 (b) Amendment No. 1 dated December 20, 1993 to the INTERMET Included as Exhibit 10.16(b) to INTERMET Form
Corporation Salaried Employees Severance Plan 10-K for the year ended December 31, 1993
10.8 INTERMET Salary Continuation Plan Included as Exhibit 10.18 to INTERMET Form 10-K
for the year ended December 31, 1992
10.10 INTERMET Corporation 1997 Director's Stock Option Plan Included as Exhibit A to INTERMET DEF 14/A
filed March 4, 1997
10.11 1997 Directors' Deferred Compensation Plan Included as Exhibit 10.25 to INTERMET Form 10-K
for the year ended December 31, 1996
10.12 $300,000,000 Conformed Five-Year Credit Agreement, dated Included as Exhibit 4.14(a) to INTERMET Form
November 5, 1999, as amended through the Fourth Amendment dated 10-Q filed August 14, 2001
as of July 17, 2001, by and among INTERMET, The Bank of Nova
Scotia as lender, administrative agent and collateral agent,
and the various lenders named therein, including contents of
omitted schedules and exhibits
10.13 Fifth Amendment to and Waiver Under Five-Year Credit Agreement Included as Exhibit 10.18 to INTERMET Form S-4
Registration Statement No. 333-97245 filed July
29, 2002
10.14 (a) Employment Agreement dated October 16, 1995 between INTERMET Included as Exhibit 10.22 to INTERMET Form 10-K
and John Doddridge for the year ended December 31, 1995
10.14 (b) Amendment to Employment Agreement dated January 2, 2003 by and Included in this report
between INTERMET and John Doddridge
10.15 Employment Agreement between INTERMET and Gary F. Ruff dated Included in this report
June 1, 1999
10.16 Employment Agreement between INTERMET and Alan J. Miller dated Included in this report
January 4, 2000
10.17 Employment Agreement between INTERMET and Terry Graessle dated Included in this report
March 26, 2001
10.18 Employment Agreement between INTERMET and Todd A. Heavin dated Included in this report
April 12, 2002
18
Exhibit
Number Description of Exhibit Method of Filing
- ------ ---------------------- ----------------
12.1 Ratio of Earnings to Fixed Charges Included as Exhibit 12.1 to INTERMET Form S-4A
Registration Statement No. 333-97245 filed
August 13, 2002
12.2 Statement regarding Computation of Ratios Included as Exhibit 12.2 to INTERMET Form S-4A
Registration Statement No. 333-97245 filed
August 13, 2002
13 INTERMET's Annual Report to Shareholders Included in this report
21 Subsidiaries of INTERMET Included in this report
23 Consent of Independent Auditors Included in this report
24 Power of Attorney Included in this report
99.1 Certification of Chief Executive Officer Included in this report
99.2 Certification of Chief Financial Officer Included in this report
* This instrument defines the rights of holders of long-term debt of INTERMET
not being registered and the total amount of securities authorized under
the instrument does not exceed ten percent of the total assets of INTERMET
and its subsidiaries on a consolidated basis. Accordingly, pursuant to Item
601 (b)(4)(iii) of Regulation S-K of the Securities Exchange Act of 1933,
as amended, this instrument is not being filed, but INTERMET will furnish a
copy of this instrument to the Commission upon request.
19
SIGNATURES
Pursuant to the requirements of Section 13(a) or 15(d) of the Securities
Exchange Act of 1934, INTERMET has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
INTERMET Corporation
By: /s/ John Doddridge
-------------------------------------
John Doddridge
Chairman of the Board of Directors
and Chief Executive Officer
Date: February 25, 2003
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below, as of February 25, 2003, by the following persons on
behalf of INTERMET in the capacities indicated.
SIGNATURE CAPACITY
- --------- --------
/s/ John Doddridge Chairman of the Board of Directors and Chief Executive Officer
- ------------------------------------- (Principal Executive Officer)
John Doddridge
/s/ Gary F. Ruff President, Chief Operating Officer and Director
- -------------------------------------
Gary F. Ruff
/s/ John P. Crecine Director
- -------------------------------------
John P. Crecine
/s/ Julia D. Darlow Director
- -------------------------------------
Julia D. Darlow
/s/ Norman F. Ehlers Director
- -------------------------------------
Norman F. Ehlers
/s/ John R. Horne Director
- -------------------------------------
John R. Horne
/s/ Thomas H. Jeffs II Director
- -------------------------------------
Thomas H. Jeffs II
/s/ Charles G. McClure Director
- -------------------------------------
Charles G. McClure
/s/ Richard J. Peters Director
- -------------------------------------
Richard J. Peters
/s/ John H. Reed Director
- -------------------------------------
John H. Reed
/s/ Pamela E. Rodgers Director
- -------------------------------------
Pamela E. Rodgers
/s/ Robert E. Belts Vice President - Finance and Chief Financial Officer
- ------------------------------------- (Principal Financial Officer)
Robert E. Belts
/s/ Gregory B. Wahowiak Controller (Principal Accounting Officer)
- -------------------------------------
Gregory B. Wahowiak
20
CERTIFICATIONS
I, John Doddridge, certify that:
1. I have reviewed this annual report on Form 10-K of INTERMET Corporation;
2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this annual report;
3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of
the registrant as of, and for, the periods presented in this annual report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this annual report is
being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
annual report (the "Evaluation Date"); and
c) presented in this annual report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of
the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent function):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated in this
annual report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including
any corrective actions with regard to significant deficiencies and material
weaknesses.
Date: February 25, 2003
/s/ John Doddridge
------------------
Chairman and Chief Executive Officer
21
CERTIFICATIONS
I, Robert E. Belts, certify that:
1. I have reviewed this annual report on Form 10-K of INTERMET Corporation;
2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this annual report;
3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of
the registrant as of, and for, the periods presented in this annual report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this annual report is
being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
annual report (the "Evaluation Date"); and
c) presented in this annual report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of
the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons performing the
equivalent function):
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated in this
annual report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including
any corrective actions with regard to significant deficiencies and material
weaknesses.
Date: February 25, 2003
/s/ Robert E. Belts
--------------------
Vice President of Finance and Chief
Financial Officer
22
EXHIBIT INDEX
-------------
Exhibit
Number Description of Exhibit Method of Filing
- ------ ---------------------- ----------------
2.1 Agreement and Plan of Merger among INTERMET, I M Acquisition Included as Exhibit 4 to INTERMET Form 8-K
Corp., and Sudbury, Inc. dated November 18, 1996 filed November 25, 1996
2.2 Asset Purchase Agreement Between INTERMET Corporation and Included as Exhibit 1 to INTERMET Form 8-K
Quadion Corporation for the purchase of the assets of Tool filed January 14, 1999
Products, Inc. dated December 2, 1998
2.3 Stock Purchase and Sale Agreement Between INTERMET Corporation, Included as Exhibit 99.1 to INTERMET Form 8-K
Gantec II, LLC, JJM, LLC, and Cerberus Institutional Partners, filed December 30, 1999
L.P. for the purchase of the stock of Diversified Diemakers,
Inc. dated November 16, 1999
2.4 Contents of omitted schedules and exhibits to the Stock Included as Exhibit 99.2 to INTERMET Form 8-K
Purchase and Sale Agreement for the purchase of the stock of filed December 30, 1999
Diversified Diemakers, Inc.
2.5 Stock Purchase and Sale Agreement Between INTERMET Corporation, Included as Exhibit 99.3 to INTERMET Form 8-K,
Gantec II, LLC and JJM, LLC for the purchase of the stock of filed December 30, 1999
Ganton Technologies, Inc. dated November 16, 1999
2.6 Contents of omitted schedules and exhibits to the Stock Included as Exhibit 99.4 to INTERMET Form 8-K
Purchase and Sale Agreement for the purchase of the stock of filed December 30, 1999
Ganton Technologies, Inc.
3.1 Amended and Restated Articles of Incorporation of INTERMET Included as Exhibit 4.1 to INTERMET Form S-3
Registration Statement filed June 3, 1992
3.2 By-laws of INTERMET, as amended through December 10, 2003 Included in this report
4.1 Promissory Note of Lynchburg Foundry Company, dated December 1, *
1973, payable to Industrial Development Authority of the City
of Lynchburg, Virginia in the original principal amount of
$4,400,000
4.2 Guaranty Agreement, dated December 1, 1973, by and between The *
Mead Corporation and the Industrial Development Authority of
the City of Lynchburg, Virginia
4.3 Trust Indenture, dated December 1, 1973, by and among *
Industrial Development Authority of the City of Lynchburg,
Virginia, Lynchburg Foundry Company and United Virginia Bank,
as trustee
4.4 Promissory Notes of Lynchburg Foundry Company, dated June 1, *
1976, payable to Industrial Development Authority of the City
of Lynchburg, Virginia, in the original principal amounts of
$2,700,000, $1,000,000, $550,000 and $550,000, respectively
4.5 Guaranty Agreement, dated June 1, 1976, of The Mead Corporation *
in favor of Industrial Development Authority of the City of
Lynchburg, Virginia
4.6 Trust Indenture, dated June 1, 1976, by and among Industrial *
Development Authority of the City of Lynchburg, Virginia,
Lynchburg Foundry Company and United Virginia Bank, as
Exhibit
Number Description of Exhibit Method of Filing
- ------ ---------------------- ----------------
trustee, with respect to Pollution Control Revenue Bonds
(Mead-Lynchburg Foundry Project), Series 1976, Series 1976A,
Series 1976B and Series 1976C
4.7 Loan Contract, dated September 28, 1988, by and between *
Columbus Neunkirchen Foundry GmbH and Saarlandische
Investitionskreditbank, relating to a loan in the original
principal amount of DM 740,000
4.8 Loan Contract, dated March 1, 1989, by and between Columbus *
Neunkirchen Foundry GmbH and Saarlandische
Investitionskreditbank, relating to a loan in the principal
amount of DM 2,000,000
4.14 (a) $300,000,000 Conformed Five-Year Credit Agreement, dated Included as Exhibit 4.14(a) to INTERMET Form
November 5, 1999, as amended through the fourth Amendment dated 10-Q filed August 14, 2001
as of July 17, 2001, by and among INTERMET, The Bank of Nova
Scotia as lender, administrative agent and collateral agent,
and the various lenders named therein
4.17 (a) Final Private Placement Memorandum for $35,000,000 Development *
Authority of Columbus Georgia Variable Rate Limited Obligation
Revenue Bonds (Columbus Foundry, L.P. Project, Series 1999).
4.17 (b) Master Indenture Trust dated as of December 1, 1999, by and *
between Development Authority of Columbus, Georgia, as issuer,
and Harris Trust and Savings Bank, as trustee
4.17 (c) Series 1999A Supplement dated as of December 1, 1999 to Master *
Indenture Trust dated December 1, 1999 by and between
Development Authority of Columbus, Georgia, as issuer, and
Harris Trust and Savings Bank, as trustee
4.18 (a) Shareholder Protection Rights Agreement dated as of October 6, Included as Exhibit 4 to INTERMET Form 8-K
1995 between INTERMET and Trust Company Bank, as Rights Agent filed October 11, 1995
4.18 (b) Amendment No. 1 dated October 16, 1997 to the Shareholder Included as Exhibit 4 to INTERMET Form 8-A12G/A
Protection Rights Agreement dated October 6, 1995 between filed October 20, 1997
INTERMET and Trust Company Bank, as Rights Agent
4.19 (a) Indenture dated as of June 13, 2002 among INTERMET Corporation, Included as Exhibit 4.1 to INTERMET Form S-4
U.S. Bank National Association and the guarantors named therein Registration Statement No. 333-97245 filed July
29, 2002
4.19 (b) Registration Rights Agreement dated as of June 13, 2002 among Included as Exhibit 4.3 to INTERMET Form S-4
INTERMET Corporation and the Guarantors named therein, and Registration Statement No. 333-97245 filed July
Deutsche Bank Securities Inc., Banc of America Securities LLC, 29, 2002
Scotia Capital (USA) Inc., Sun Trust Capital Markets, Inc.,
Banc One Capital Markets, Inc., Comerica Securities, Inc., and
ABN AMRO Incorporated
4.19 (c) Terms of 9 3/4% Senior Notes of $175,000,000 due 2009 Included as INTERMET Form S-4A Registration
Statement No. 333-97245 filed August 13, 2002
5.1 Opinion of Foley & Lardner (Re: INTERMET Registration Statement Included as Exhibit 5.1 to INTERMET Form S-4
on Form S-4 regarding of 9 3/4% Senior Notes of $175,000,000 Registration Statement No. 333-97245 filed July
due 2009) 29, 2002
10.1 (a) INTERMET Corporation Key Individual Stock Option Plan adopted Included as Exhibit 10.1 to INTERMET
April 25, 1984 registration statement on Form S-14, File No.
2-90815
Exhibit
Number Description of Exhibit Method of Filing
- ------ ---------------------- ----------------
10.1 (b) Amendment No. 1 dated as of August 4, 1988 to the INTERMET Included as Exhibit 10.2 to INTERMET Form 10-K
Corporation Key Individual Stock Option Plan for the year ended December 31, 1988
10.1 (c) Amendment No. 2 dated October 27, 1988 to the INTERMET Included as Exhibit 10.3 to INTERMET Form 10-K
Corporation Key Individual Stock Option Plan for year ended December 31, 1988
10.2 INTERMET Corporation Executive Stock Option and Incentive Award Included as Exhibit 4 to INTERMET Form S-8
Plan Registration Statement No. 33-59011 filed May
2, 1995
10.2 (a) INTERMET Corporation Restricted Share Unit Award Plan effective Included as Exhibit 10.2(a) to INTERMET Form
February 1, 2001 10-K for the year ended December 31, 2000
10.2 (b) INTERMET Corporation 2000 Executive Stock Option and Incentive Included as Exhibit 4 to INTERMET Form S-8
Award Plan effective April 13, 2000. Registration Statement No. 333-41208 filed July
12, 2000
10.3 INTERMET Corporation Deferred Compensation Plan effective Included as Exhibit 10.3 to INTERMET Form 10-K
December 1, 1999 for the year ended December 31, 2000
10.7 (a) INTERMET Corporation Salaried Employees Severance Plan Included as Exhibit 10.16(a) to INTERMET Form
effective as of October 1, 1993 10-K for the year ended December 31, 1993
10.7 (b) Amendment No. 1 dated December 20, 1993 to the INTERMET Included as Exhibit 10.16(b) to INTERMET Form
Corporation Salaried Employees Severance Plan 10-K for the year ended December 31, 1993
10.8 INTERMET Salary Continuation Plan Included as Exhibit 10.18 to INTERMET Form 10-K
for the year ended December 31, 1992
10.10 INTERMET Corporation 1997 Director's Stock Option Plan Included as Exhibit A to INTERMET DEF 14/A
filed March 4, 1997
10.11 1997 Directors' Deferred Compensation Plan Included as Exhibit 10.25 to INTERMET Form 10-K
for the year ended December 31, 1996
10.12 $300,000,000 Conformed Five-Year Credit Agreement, dated Included as Exhibit 4.14(a) to INTERMET Form
November 5, 1999, as amended through the Fourth Amendment dated 10-Q filed August 14, 2001
as of July 17, 2001, by and among INTERMET, The Bank of Nova
Scotia as lender, administrative agent and collateral agent,
and the various lenders named therein, including contents of
omitted schedules and exhibits
10.13 Fifth Amendment to and Waiver Under Five-Year Credit Agreement Included as Exhibit 10.18 to INTERMET Form S-4
Registration Statement No. 333-97245 filed July
29, 2002
10.14 (a) Employment Agreement dated October 26, 1995 between INTERMET Included as Exhibit 10.22 to INTERMET Form 10-K
and John Doddridge for the year ended December 31, 1995
10.14 (b) Amendment to Employment Agreement dated January 2, 2003 Included in this report
by and between INTERMET and John Doddridge
10.15 (a) Employment Agreement between INTERMET and Gary F. Ruff dated Included in this report
June 1, 1999
10.16 (b) Employment Agreement between INTERMET and Alan J. Miller dated Included in this report
January 4, 2000
10.17 (c) Employment Agreement between INTERMET and Terry Graessle dated Included in this report
March 26, 2001
10.18 (d) Employment Agreement between INTERMET and Todd A. Heavin dated Included in this report
April 12, 2002
Exhibit
Number Description of Exhibit Method of Filing
- ------ ---------------------- ----------------
12.1 Ratio of Earnings to Fixed Charges Included as Exhibit 12.1 to INTERMET Form S-4A
Registration Statement No. 333-97245 filed
August 13, 2002
12.2 Statement regarding Computation of Ratios Included as Exhibit 12.2 to INTERMET Form S-4A
Registration Statement No. 333-97245 filed
August 13, 2002
13 INTERMET's Annual Report to Shareholders Included in this report
21 Subsidiaries of INTERMET Included in this report
23 Consent of Independent Auditors Included in this report
24 Power of Attorney Included in this report
99.1 Certification of Chief Executive Officer Included in this report
99.2 Certification of Chief Financial Officer Included in this report
* This instrument defines the rights of holders of long-term debt of INTERMET
not being registered and the total amount of securities authorized under
the instrument does not exceed ten percent of the total assets of INTERMET
and its subsidiaries on a consolidated basis. Accordingly, pursuant to Item
601(b)(4)(iii) of Regulation S-K of the Securities Exchange Act of 1933, as
amended, this instrument is not being filed, but INTERMET will furnish a
copy of this instrument to the Commission upon request.