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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended December 31, 1993 Commission File Number 0-452
TECUMSEH PRODUCTS COMPANY
(Exact Name of Registrant as Specified in its Charter)
Michigan 38-1093240
(State of Incorporation) (I.R.S. Employer Identification No.)
100 East Patterson Street
Tecumseh, Michigan 49286
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (517) 423-8411
Securities Registered Pursuant to Section 12(b) of the Act: Securities Registered Pursuant to Section 12(g) of the Act:
Name of Each Exchange
Title of Each Class on Which Registered Class B Common Stock, $1.00 Par Value
------------------- ----------------------- Class A Common Stock, $1.00 Par Value
None None Class B Common Stock Purchase Rights
Class A Common Stock Purchase Rights
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. [ ]
Registrant disclaims the existence of control and, accordingly, believes that
as of March 11, 1994, all of the 5,470,146 shares of its Class B Common Stock,
$1.00 par value, then issued and outstanding, were held by non-affiliates of
Registrant. Certain shareholders, which, as of March 11, 1994, held an
aggregate of 2,391,940 shares of Class B Common Stock might be regarded as
"affiliates" of Registrant as that word is defined in Rule 405 under the
Securities Exchange Act of 1934, as amended. If such persons are "affiliates,"
the aggregate market value as of March 11, 1994 (based on the closing price of
$58.75 per share, as reported on the NASDAQ National Market System on such
date) of the 3,078,206 shares then issued and outstanding held by
non-affiliates was approximately $180,844,603.
Numbers of shares outstanding of each of the Registrant's classes of Common
Stock at March 11, 1994:
Class B Common Stock, $1.00 Par Value: 5,470,146
Class A Common Stock, $1.00 Par Value: 16,410,438
Certain information contained in the Registrant's Annual Report to Shareholders
for the year ended December 31, 1993 has been incorporated herein by reference
in Parts I and II hereof. Certain information in the definitive proxy
statement to be used in connection with the Registrant's 1994 Annual Meeting of
Shareholders has been incorporated herein by reference in Part III hereof. The
Exhibit Index is located on page 30.
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TABLE OF CONTENTS
Item Page
- ---- ----
PART I
1. Business 3
Executive Officers of the Registrant 13
2. Properties 14
3. Legal Proceedings 14
4. Submission of Matters to a Vote of Security Holders 15
PART II
5. Market for the Company's Common Equity and Related Stockholder Matters 16
6. Selected Financial Data 16
7. Management's Discussion and Analysis of Financial Condition
and Results of Operations 16
8. Financial Statements and Supplementary Data 16
9. Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure 16
PART III
10. Directors and Executive Officers of the Company 17
11. Executive Compensation 17
12. Security Ownership of Certain Beneficial Owners and Management 17
13. Certain Relationships and Related Transactions 17
PART IV
14. Exhibits, Financial Statement Schedules and Reports on Form 8-K 18
Signatures 27
Exhibit Index 30
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PART I
ITEM 1. BUSINESS
GENERAL
Tecumseh Products Company (the Company) is a full-line, independent global
manufacturer of hermetic compressors for air conditioning and refrigeration
products, gasoline engines and power train components for lawn and garden
applications, and pumps. The Company believes it is the largest independent
producer of hermetically sealed compressors in the world, as well as one of the
world's leading manufacturers of small gasoline engines and power train
products used in lawn and garden applications. In 1993, the Company's products
were sold in over 100 countries around the world.
The Company groups its products into three principal industry segments:
Compressor Products, Engine and Power Train Products, and Pump Products.
Compressor Products include a broad range of air conditioning and
refrigeration compressors and compressor parts as well as refrigeration
condensing units. The Company's compressor products range from fractional
horsepower units used in small refrigerators and dehumidifiers to large units
used in commercial air conditioning applications. The Company sells
compressors in four major compressor market segments: household refrigerators
and freezers; room air conditioners; commercial and residential unitary central
air conditioning systems; and commercial devices including freezers,
dehumidifiers and vending machines. The Company sells compressors to original
equipment manufacturers ("OEMs") as well as in the aftermarket.
Engine and Power Train Products consist of (i) two- and four-cycle
gasoline engines for use in a wide variety of lawn and garden applications as
well as other consumer and light commercial applications and (ii)
transmissions, transaxles and related parts for use principally in lawn and
garden tractors and riding lawn mowers. The Company sells engine and power
train products to OEMs and aftermarket distributors.
Pump Products include (i) small submersible pumps used in a wide variety
of industrial, commercial, and consumer applications and (ii) heavy duty
centrifugal type pumps used in the construction, mining, agricultural, marine,
and transportation industries.
FOREIGN OPERATIONS AND SALES
In recent years, international operations and sales have become
increasingly important to the Company's business as a whole. In 1993, sales to
customers outside the United States represented approximately 45% of total
consolidated net sales, up from approximately 30% in 1988. Additionally, a
substantial portion of the Company's products are manufactured overseas.
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Compressor products are produced by the Company's plants in both Brazil and
France, while engines are produced in Italy.
Products sold outside the United States are manufactured at both U.S. and
foreign plants. The Company's European compressor subsidiary, L'Unite
Hermetique, S.A., ("L'Unite Hermetique"), generally sells the compressor
products it manufactures in Europe, the Middle East, Africa, Latin America and
Asia. Sociedade Intercontinental De Compressores Hermeticos-SICOM, Ltda.
("SICOM"), the Company's Brazilian compressor subsidiary, sells its products
principally in Latin America and, to a lesser extent, in North America and
Europe. In the engine business, the Company's two principal markets are North
America, which is generally served by the Company's U.S. manufacturing
operations, and Europe, which is served both by the manufacturing operations of
the Company's European engine subsidiary, Tecnamotor, S.r.l. ("Tecnamotor") in
Italy and, to a lesser extent, by U.S. export sales.
Of the Company's sales to customers outside the United States in 1993,
approximately 36% were to customers of compressor and engine products in
Europe. Sales of compressors are also significant in markets in Latin America,
Asia and the Far East.
The Company's dependence on sales in foreign countries entails certain
risks, including currency fluctuations, unstable economic or political
conditions in some areas and the possibility of U.S. government embargoes on
sales to certain countries. The Company's foreign manufacturing operations are
subject to the same risks and others as well, including risks of governmental
expropriation, governmental regulations which may be disadvantageous to
businesses owned by foreign nationals and instabilities in the work force due
to changing political and social conditions.
These considerations are especially significant in the context of the
Company's Brazilian operations given the importance of SICOM's performance to
the Company's total operating results. Political, social, and economic
conditions in Brazil are less stable than those which prevail in the United
States and many other countries, and this instability is reflected in SICOM's
operating results, which can vary dramatically from period to period.
COMPRESSOR PRODUCTS
The Compressor Products segment is the Company's largest industry segment.
A compressor is a device which compresses a refrigerant gas. When the gas is
later permitted to expand, it absorbs and transfers heat, and the cooling
effect thus produced forms the basis for a wide variety of refrigeration
products. The Company's compressors range from fractional horsepower units
used in small refrigerators and dehumidifiers to large units used in commercial
air conditioning applications. All of the compressors produced by the Company
are hermetically sealed. The Company's current compressor line includes
reciprocating and rotary designs and the Company is in the process of
developing a line of scroll compressors.
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The Company's compressors are used in each of four major compressor market
segments: household refrigerators and freezers; room air conditioners;
residential and commercial unitary central air conditioning systems; and
commercial devices, including freezers, dehumidifiers, refrigerated display
cases, water coolers and vending machines. The Company believes it is the
world's only independent manufacturer of compressor products for all four of
these market segments.
PRODUCT LINE
The Company manufactures and sells a wide variety of traditional,
reciprocating compressors suitable for use in all of the market segments
described above. The Company also produces rotary compressors for use in room
air conditioning applications. Rotary compressors generally provide increased
operating efficiency, lower equipment space requirements, and reduced sound
levels when compared to reciprocating designs. In November 1993, the Company
reached an agreement with General Electric's appliance operations in Columbia,
Tennessee to purchase certain rotary compressor manufacturing equipment. After
being relocated and retooled, this equipment will be utilized in the production
of room air conditioning rotary compressors in smaller sizes that will
complement the Company's present product offering.
During 1992, the Company introduced its new line of "Quadro-Flex"
reciprocating compressors offering improved efficiency for the commercial
unitary market. Early production runs of certain Quadro-Flex models resulted in
unacceptable failure rates in the field. The Company believes that appropriate
corrective actions have been taken to assure the high level of quality expected
in this product. In light of the competitive advantages of the Quadro-Flex
design, the Company anticipates increasing demand for its current Quadro-Flex
products as customers become comfortable that the early problems have been
corrected. In addition, the Company plans to use the Quadro-Flex design in a
broad range of products for commercial refrigeration applications.
Scroll compressors offer energy efficiency and reduced noise levels
compared to traditional reciprocating designs and are generally preferred by
OEMs for certain products, including unitary central air conditioning systems
and certain commercial applications. The Company does not currently offer
scroll compressors while some of its competitors do, which the Company believes
puts it at a competitive disadvantage. However, the Company has developed a
residential unitary air conditioning compressor using scroll technology and is
currently evaluating samples of this scroll compressor with key customers. In
January 1994, the Company's Board of Directors authorized funding for a scroll
compressor manufacturing facility, which is expected to be in limited
production by the end of 1994.
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MANUFACTURING OPERATIONS
Compressor Products manufactured in the Company's U.S. plants accounted
for approximately 55% of 1993 compressor sales. The balance was produced at
the Company's manufacturing facilities in Brazil and France. The compressor
operations are substantially vertically integrated, and the Company
manufactures a significant portion of its component needs internally, including
electric motors, metal stampings and glass terminals. Raw materials essential
to the conduct of business are purchased from a variety of non-affiliated
suppliers. The Company utilizes multiple sources of supply and the required
raw materials and purchased components have generally been available in
sufficient quantities.
SALES AND MARKETING
The Company markets its Compressor Products globally under the "Tecumseh"
brand, as well as under the "SICOM" brand in Latin America and the "L'Unite
Hermetique" brand in Europe.
The Company sells its Compressor Products in North America primarily
through its own sales staff. Major OEM customers are assigned to sales staff
on an account basis. Other customers (aftermarket wholesalers and smaller
commercial OEM's) are served by sales personnel assigned to specified
geographic regions. Each of the Company's Brazilian and French subsidiaries
has its own sales staff. In certain foreign markets, the Company also uses
local independent sales representatives.
Substantially all of the Company's sales of Compressor Products for room
air conditioning applications are to OEMs. Sales of Compressor Products for
unitary central air conditioning systems and commercial applications include
substantial amounts of both OEM and aftermarket customers.
SICOM's Compressor Products are sold primarily in Brazil and other Latin
American countries. SICOM also furnishes component parts to the Company's
North American plants and finished compressors for resale in North America.
L'Unite Hermetique, which does not sell products in North America, sells a
majority of its products in Europe but also has substantial sales outside
Europe.
The Company has over 1,200 customers for Compressor Products, the majority
of which are commercial customers. In 1993, the two largest customers for
Compressor Products accounted for 9.0% and 4.0%, respectively, of consolidated
net sales of the Company's Compressor Products, or 5.5% and 2.5%, respectively,
of consolidated net sales. Loss of either of these customers could have a
material adverse effect on the results of operations of the Compressor Products
segment and, at least temporarily, on the Company's business as a whole.
Generally, the Company does not enter into long-term contracts with its
customers in this segment. However, the present business relationships with
all major customers have existed for a substantial period of time.
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In 1993, approximately 34% of the Compressor Products produced by the
Company in its U.S. plants were exported to foreign countries. The Company
exports to over 100 countries worldwide. Approximately two-thirds of these
exported products were sold in the Far and Middle East.
COMPETITION
All of the compressor market segments in which the Company operates are
highly competitive. Participants compete on the basis of price, efficiency,
reliability, noise level, and delivery. The Company competes not only with
other independent compressor producers but also with manufacturers of end
products which have internal compressor manufacturing operations.
The domestic unitary air conditioning compressor market consists of
original equipment manufacturers and a significant compressor aftermarket. The
Company competes primarily with two U. S. manufacturers, Copeland Corporation,
a subsidiary of Emerson Electric, Inc., and Bristol, a division of York
International Corporation. Copeland Corporation enjoys a larger volume of the
domestic unitary air conditioning compressor business than either Bristol or
the Company. Several important OEMs in the unitary air conditioning market
have decided to significantly reduce the use of traditional reciprocating
compressors in 1994 as part of an industry trend toward the use of scroll
compressors. Since the Company does not currently produce scroll compressors
in commercial quantities, this accelerating trend will reduce, at least
temporarily, the Company's share of this important market and is expected to
intensify price competition for the remaining available reciprocating
compressor business. In anticipation of this trend, the Company has developed
its own scroll compressor, which it is currently sampling with key customers.
In January 1994, the Company's Board of Directors authorized funding for a
scroll compressor manufacturing facility, which is expected to be in limited
production by the end of 1994.
In the domestic room air conditioning compressor market, the Company
competes primarily with foreign companies, which import compressors to the
United States but are also increasing U. S. manufacturing capabilities. The
Company also competes to a lesser extent with U. S. manufacturers.
In the domestic markets for water coolers, dehumidifiers, vending
machines, refrigerated display cases and other commercial refrigeration
products, the Company competes primarily with manufacturers from the Far East,
Europe and South America, and to a lesser extent, the United States. The
non-captive portion of the household refrigerator and freezer segment is
substantially dominated by Far Eastern manufacturers, which import compressors
to the United States but are also increasing U.S. manufacturing capabilities.
In the geographic regions in which the Company supplies a significant
portion of its domestically produced export compressors, the primary
competitors are Bristol, Copeland Corporation and several Far East
manufacturers, most of which are substantially larger and have greater
resources than the Company.
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L'Unite Hermetique sells the major portion of its manufactured compressors
in Western Europe, and competes in those markets primarily with several large
European manufacturers, some of which are captive suppliers, and to a lesser
but increasing extent, with manufacturers from the Far East.
SICOM sells the major portion of its manufactured compressors in Brazil
and other Latin American countries and competes directly with Embraco S.A., an
affiliate of Whirlpool Corporation, in Brazil and with Embraco and several
other foreign manufacturers in Latin America.
The ability to successfully bring new products to market in a timely
manner has rapidly become a critical factor in competing in the compressor
products business as a result of, among other things, the imposition of energy
efficiency standards and environmental regulations.
NEW REGULATORY REQUIREMENTS
Chloroflourocarbon compounds ("CFCs"), the primary refrigerants used in
household refrigerators and freezers and in commercial refrigeration equipment,
have been identified as one of the leading factors causing depletion of the
Earth's ozone layer. Under a 1992 international agreement, CFCs are scheduled
to be phased out by January 1, 1996. Several OEMs have already begun to offer
products which do not utilize CFCs. Under current U.S. industry plans, the
replacement for CFCs in the refrigerator and freezer market will be a
refrigerant known as HFC-134a. The Company has already designed, and tested
with customers, and is prepared to begin production of its new TPY line of
refrigerator and freezer compressors which use HFC-134a.
The U.S. government has not yet determined which refrigerant or
refrigerants will be approved as replacements for CFCs in the commercial market
segment, but the Company anticipates that one approved replacement will be
HFC-134a. The Company has been producing commercial compressors using HFC-134a
since late 1992. By the end of 1993 it could cover approximately 75% of its
volume in this market segment with compressors using this refrigerant.
Pursuant to the National Appliance Energy Conservation Act of 1987 (the
"NAECA") the U.S. government requires higher energy efficiency ratings on
certain unitary air conditioning products by January 1, 1994 and on room air
conditioning products during 1997. The Company's unitary products meet the
relevant 1994 standard for unitary products. The standard for room
air-conditioning products has not been finalized, but the Company will need to
improve the efficiency of its rotary compressors to meet the standard.
The NAECA also required higher efficiency ratings for refrigerator and
freezer products beginning in 1993, and still higher standards, not yet
specified, will be required in 1998. Currently, the Company only participates
to a very limited extent in the U.S. refrigerator and freezer market. The
Company is pursuing this U.S. market with its new TPY compressor line, which
meets the 1993 energy efficiency standards while using the HFC-134a
refrigerant.
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ENGINE AND POWER TRAIN PRODUCTS
Small gasoline engines account for a majority of the net sales of the
Company's Engine and Power Train Products segment. The Company manufactures
gasoline engines, both two- and four-cycle types, with aluminum diecast bodies
ranging in sizes from 1.6 through 16.5 horsepower and with cast iron bodies
ranging in size from 12 through 18 horsepower. These engines are used in a
broad variety of consumer products, including lawn mowers (both riding and
walk-behind types), snow blowers, small lawn and garden tractors, small power
devices used in outdoor chore products, and certain kinds of self-propelled
vehicles. The Company's power train products include transmissions, transaxles
and related parts used principally in lawn and garden tractors and riding lawn
mowers.
MANUFACTURING OPERATIONS
The Company manufactures engines and related components in its four plants
in the United States and one plant in Italy. All of the Company's power train
products are manufactured in one facility in the United States. Operations of
the Company in this segment are partially vertically integrated as the Company
produces most of its plastic parts and carburetors, as well as a substantial
portion of the aluminum diecastings used in its engines and power trains.
SALES AND MARKETING
The Company markets its Engine and Power Train Products worldwide under
the "Tecumseh" and "Peerless" brands, and in Europe under the "Tecnamotor"
brand. A substantial portion of the Company's engines are incorporated into
lawn mowers sold under brand labels, including the "Craftsman" brand of its
largest engine products customer, Sears, Roebuck and Co. ("Sears").
A majority of the Company's Engine and Power Train Products are sold
directly to OEMs. The Company also sells engines and parts to its authorized
dealers and distributors, who service its engines both in the United States and
abroad. Marketing of Engine and Power Train Products is handled by the
Company's own sales staff and by local sales representatives in certain foreign
countries.
Sales to Sears and its suppliers in the aggregate accounted for
approximately 6% of the Company's 1993 consolidated net sales and approximately
20% of its net sales of Engine and Power Train Products. Sales to the
Company's second largest customer in this segment accounted for approximately
16% of the segment's net sales in 1993 and 5% of the Company's 1993
consolidated net sales. Loss of either of the Company's two largest customers
would have a material adverse effect on the results of operations of this
segment and, at least temporarily, on the Company's business as a whole. There
are no long-term contracts between the Company
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and its major customers in this segment, but the present business relationships
have existed for a substantial period of time.
COMPETITION
The Company believes it is the second largest independent producer of
small gasoline engines in the United States and that the largest such producer,
with a broader product range, is Briggs & Stratton Corporation. The Company
competes not only with other engine manufacturers but also with manufacturers
of end products which produce their own engines and power transmission
components.
North America and Europe are the principal markets for lawn and garden
products. Foreign competition for sales has been limited in the past but is
increasing, particularly as foreign manufacturers have begun establishing U.S.
manufacturing facilities. In Europe, the late 1992 devaluation of the Italian
lira relative to the U.S. dollar has enabled the Company's Italian-produced
products to become more cost-competitive with other products available in the
European market.
Competition in the Company's engine business is based principally on
price, service, product performance and features. As mass merchandisers have
captured a larger portion of the sales of lawn and garden products in the
United States, price competition and the ability to offer customized styling
and feature choices have become even more significant factors. The Company
believes that it competes effectively on these bases.
The Company's power train business has been under significant competitive
pressure over the last several years with certain of its competitors
aggressively competing for market share primarily on the basis of price. As a
result, the Company's power train sales have been steadily decreasing since
1987. In response to this, the Company executed a plan to reduce product cost
and increase efficiency, by consolidating its power train production operations
into one plant. In addition, the Company has recently introduced a new line of
affordable hydrostatic, fluid-type transmissions aimed at volume segments of
the market.
NEW EMISSION STANDARDS
The California Air Resources Board ("CARB") has promulgated exhaust
emission standards for off-road utility engines which cover the two- and
four-cycle engine products manufactured by the Company. The Clean Air Act
Amendments of 1990 require EPA approval of the CARB regulations prior to
implementation. The approval from the EPA is pending. The California
regulations require certain emission reductions by January 1, 1995 and
additional, more stringent reductions by 1999. A portion of the Company's
engine products, as presently designed and manufactured, do not meet all the
1995 CARB standards; however, engineering efforts have resulted in select
engine certification to CARB requirements, and an adequate cross section of the
Company's current four-cycle products will be modified to meet the 1995
requirements. The Clean Air Act Amendments of 1990 also allow other states
either to adopt
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the California regulations after EPA approval or a federal standard which the
EPA is formulating. The EPA continues its emissions studies but, as yet, has
not promulgated regulations containing standards; the Company anticipates
public hearings (in advance of proposed federal Phase I standards) during the
second quarter of 1994. The Company is also participating through appropriate
trade associations, in the negotiated regulation process currently being
conducted to develop a federal Phase II exhaust emission standard. Continuing
design and other efforts will be expended to meet the emission standards;
however, it is not currently possible to determine the cost thereof nor the
impact on future operating results or competitive position of the Company.
PUMP PRODUCTS
The Company manufactures and sells small submersible pumps and related
products through its subsidiary, Little Giant Pump Company ("Little Giant").
Little Giant's pumps are used in a broad range of commercial, industrial, and
consumer products, including parts washers, machine tools, evaporative coolers,
sump pumps, swimming pool equipment, statuary, fountains and water gardening.
Little Giant's products are sold throughout the United States, Canada,
Europe, and the Middle East, to OEMs and distributors and to retailers
directly. Marketing is carried out both through Little Giant's own sales staff
and also through manufacturer's representatives.
The Company's other pump subsidiary, MP Pumps Inc. ("MP Pumps"),
manufactures and sells a variety of heavy duty centrifugal pumps ranging in
capacity from 15 to 300 gallons per minute, that are used in the construction,
mining, agricultural, marine and transportation industries.
MP Pumps sells both to OEMs, which incorporate its pumps into their end
products, and through an extensive network of distributors located throughout
the United States, which sell to end-users. A limited number of pumps are also
sold to departments and agencies of the U.S. government. Most of MP Pumps'
products are sold in the United States. MP Pumps markets its products through
its own sales staff.
The Company markets its pump products globally under the "Little Giant,"
"Jaeger" and "MP Pumps" brand names.
The pump industry is highly fragmented, with many relatively small
producers competing for sales. Little Giant has been particularly successful in
competing in this industry by targeting specific market niches where
opportunities exist and then designing and marketing corresponding products.
Though still a relatively small portion of the Company as a whole, during the
last five years the pump business has been its fastest growing business, with
sales increasing from $48.5 million in 1989 to $77.9 million in 1993.
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BACKLOG AND SEASONAL VARIATIONS
Most of the Company's production is against short-term purchase orders,
and backlog is not significant to its business.
Both Compressor Products and Engine and Power Train Products are subject
to some seasonal variation. Generally, the Company's sales and operating
profit are stronger in the first two quarters of the year than in the last two
quarters.
PATENTS, LICENSES AND TRADEMARKS
The Company owns a substantial number of patents, licenses and trademarks
and deems them to be important to certain of its lines of business; however,
the success of the Company's overall business is not considered primarily
dependent on them. The Company owns and uses in the conduct of its business a
variety of registered trademarks, the most familiar of which is the trademark
consisting of the word "Tecumseh" in combination with a Native American Indian
head symbol.
RESEARCH AND DEVELOPMENT
The Company must continually develop new and improved products in order to
compete effectively and to meet evolving regulatory standards in all of its
major lines of business. The Company expended approximately $24.9 million,
$27.0 million and $25.1 million during 1993, 1992 and 1991 on research
activities relating to the development of new products and the development of
improvements to existing products. None of this research was customer
sponsored.
ENVIRONMENTAL LEGISLATION
The Company has been named by the EPA as a potentially responsible party
in connection with the Sheboygan River and Harbor Superfund Site in Wisconsin.
It is also the subject of an EPA administrative proceeding relating to its
Somerset, Kentucky facility. The Company is also participating with the EPA and
various state agencies in investigating possible remedial action that may be
necessary at other sites. See "Management's Discussion and Analysis of
Financial Condition and Results of Operations - Liquidity and Capital
Resources" on pages 14 to 15 and "Note 9" on page 23 in the Company's Annual
Report to Shareholders for the year ended December 31, 1993 for a discussion of
the impact of these matters on the Company's financial condition and results of
operations. Also see Item 3. Legal Proceedings.
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INDUSTRY SEGMENT AND GEOGRAPHIC LOCATION INFORMATION
The results of operations and other financial information by industry
segment and geographic location (including the footnotes thereto) for each of
the years ended December 31, 1993, 1992 and 1991 appear at page 12 of The
Company's Annual Report to Shareholders for the year ended December 31, 1993
and are incorporated herein by reference.
EMPLOYEES
On December 31, 1993 the Company employed approximately 12,600 persons,
40% of which were employed in foreign locations. Approximately 3,400 of the
U.S. employees were represented by labor unions, with no more than
approximately 1,300 persons represented by the same union. The majority of
foreign location personnel are represented by national trade unions. The
number of the Company's employees is subject to some seasonal variation; during
1993, the maximum number of persons employed at one time was approximately
12,800, and the minimum was 11,900.
The Company believes it has a good relationship with its employees.
EXECUTIVE OFFICERS OF THE REGISTRANT
The following are the executive officers of the Company.
PERIOD OF SERVICE
NAME AND AGE OFFICE OR POSITION HELD AS AN OFFICER
------------ ---------------------------------------- -----------------
Kenneth G. Herrick, 72 Chairman of the Board of Directors (1) Since 1966
Todd W. Herrick, 51 President and Chief Executive Officer (2) Since 1974
John H. Foss, 51 Vice President, Treasurer, and Chief Since 1979
Financial Officer
Harry L. Hans, 60 Group Vice President - Engine and Power Since 1979
Train Components (3)
(1) Since 1986. Served as Chairman of the Board of Directors and Chief
Executive Officer from 1970 to 1986. Kenneth G. Herrick is the father of
Todd W. Herrick.
(2) Since 1986. Served as Vice President from 1974 until 1984; as Executive
Vice President and Assistant to the President from January, 1984 until
June, 1984; and as President and Chief Operating Officer from June,
1984 until 1986.
(3) Since 1986. Served as Executive Vice President from 1979 until 1986.
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ITEM 2. PROPERTIES
The Company's headquarters are located in Tecumseh Michigan, approximately 50
miles southwest of Detroit. At December 31, 1993 the Company had 28 principal
properties worldwide occupying approximately 5.9 million square feet with the
majority, approximately 5.6 million square feet devoted to manufacturing. Ten
facilities with approximately 2.1 million square feet were located in four
countries outside the United States. The following table shows the approximate
amount of space devoted to each of the Company's three principal business
segments.
Approximate Floor
Industry Segment Area in Square Feet
---------------- -------------------
Compressor Products 4,004,000
Engine and Power Train Products 1,643,000
Pump Products and Other 234,000
Three domestic facilities, including land, building and certain machinery
and equipment were financed and leased through industrial revenue bonds, all of
which are owned or have been repaid by the Company. All owned and leased
properties are suitable, well maintained and equipped for the purposes for
which they are used. The Company considers that its facilities are suitable
and adequate for the operations involved.
ITEM 3. LEGAL PROCEEDINGS
The Company has been named by the U.S. EPA as a potentially responsible
party in connection with the Sheboygan River and Harbor Superfund Site in
Wisconsin. This matter is discussed in "Management's Discussion and Analysis
of Financial Condition and Results of Operations" and Note 9 of the Notes to
Consolidated Financial Statements in the Company's Annual Report to
Shareholders for the year ended December 31, 1993, both of which are
incorporated herein by reference. As pointed out in the said Note 9, the
ultimate costs to the Company will be dependent upon factors beyond its control
such as the scope and methodology of the remedial action requirements to be
established by the EPA (in consultation with the State of Wisconsin), rapidly
changing technology, and the outcome of any related litigation.
In 1993, the Company and the EPA signed a Consent Agreement and Consent
Order ("CACO") to resolve certain alleged violations of the federal Resource
Conservation and Recovery Act at the Company's Somerset, Kentucky plant. Under
the terms of the CACO, the Company has paid a civil penalty of $94,990, has
installed certain equipment and will undertake certain investigations.
Following the completion of the investigations, the Company could also be
obliged to implement certain other remedial measures. Although management
expects the
14
15
total expenditures to be made in complying with the CACO to exceed $100,000, it
does not believe the total will be material to its consolidated financial
condition.
In addition to the matters discussed in the two preceding paragraphs, the
Company is currently participating with the EPA and various state agencies at
certain other sites to determine the nature and extent, if any, of any remedial
action which may be required of the Company with regard to such other sites.
Various lawsuits and claims, including those involving ordinary routine
litigation incidental to its business, to which the Company is a party, are
pending, or have been asserted, against the Company. Although the outcome of
the various lawsuits and claims asserted or pending against the Company or its
subsidiaries, including those discussed in the immediately preceding paragraph,
cannot be predicted with certainty, and some may be disposed of unfavorably to
the Company, its management has no reason to believe that their ultimate
disposition will have a materially adverse effect on the future consolidated
financial position or income from continuing operations of the Company.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted during the fourth quarter of 1993 to a vote of
security holders through the solicitation of proxies or otherwise.
15
16
PART II
ITEM 5. MARKET FOR THE COMPANY'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
The information under the caption "Financial Summary" and "Information
Concerning Equity Securities" on pages 1 and 27, respectively, of the Company's
Annual Report to Shareholders for year ended December 31, 1993 is incorporated
herein by reference. As of March 11 1994, there were 1,065 holders of record
of the Company's Class A common stock and 1,044 holders of the Class B common
stock.
ITEM 6. SELECTED FINANCIAL DATA
The information under the caption "Selected Financial Data" on page 26 of
the Company's Annual Report to Shareholders for the year ended December 31,
1993 is incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The information under the caption "Management's Discussion and Analysis of
Financial Condition and Results of Operations" on pages 13, 14, and 15 of the
Company's Annual Report to Shareholders for the year ended December 31, 1993 is
incorporated herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information on pages 16 to 27, inclusive, of the Company's Annual
Report to Shareholders for the year ended December 31, 1993 is incorporated
herein by reference. See Item 14 on page 18 of this report for financial
statement schedules.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
16
17
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY
The information pertaining to directors under the caption "Election of
Directors" in the Company's definitive Proxy Statement relating to its 1994
Annual Meeting of Shareholders is incorporated herein by reference.
Information regarding executive officers required by Item 401 of Regulation S-K
is furnished in Part I of this report.
ITEM 11. EXECUTIVE COMPENSATION
The information under the captions "Executive Compensation," "Executive
Compensation Committee Report," "Shareholder Return Performance Presentation,"
Compensation Committee Interlocks and Insider Participation" and in the last
paragraph of the caption "Election of Directors - Directors' Meetings and
Committees" in the Company's definitive Proxy Statement relating to its 1994
Annual Meeting of Shareholders is incorporated herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The information under the captions "Principal Shareholders" and "Election
of Directors - Ownership by Management of Equity Securities" in the Company's
definitive Proxy Statement relating to its 1994 Annual Meeting of Shareholders
is incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information under the caption "Compensation Committee Interlocks and
Insider Participation" in the Company's definitive Proxy Statement relating to
its 1994 Annual Meeting of Shareholders is incorporated herein by reference.
17
18
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
AND REPORTS ON FORM 8-K
(a) The following documents are filed as part of this report:
(1) The following described financial statements, notes and report on
pages 16 through 25 of the Company's Annual Report to Shareholders
for the year ended December 31, 1993:
. Report of Independent Accountants
. Consolidated Balance Sheets as of December 31, 1993 and 1992
. Statements of Consolidated Income for the years ended December
31, 1993, 1992 and 1991
. Consolidated Statements of Stockholders' Equity for the years
ended December 31, 1993, 1992 and 1991
. Statements of Consolidated Cash Flows for the years ended
December 31, 1993, 1992 and 1991
. Notes to Consolidated Financial Statements
(2) Financial Statement Schedules:
Schedule Form 10-K
Number Description Page Reference
------ ----------- --------------
V Property, Plant and Equipment 22
VI Accumulated Depreciation 23
VIII Valuation and Qualifying Accounts 24
IX Short-term Borrowings 25
X Supplementary Income Statement Information 26
Schedules other than those listed above are omitted because they are
either not applicable or are not required.
18
19
(3) Exhibits:
Exhibit
Number Description
------ -----------
(2) -(not applicable)
(3)(a) -The Company's Restated Articles of Incorporation as in effect
prior to April 22, 1992 (filed as Exhibit (3) to Annual Report
on Form 10-K for the year ended December 31, 1991 (Commission
File no. 0-452) and incorporated herein by reference)
(3)(b) -Certificate of Amendment to the Company's Restated Articles of
Incorporation adopted April 22, 1992 (filed as Exhibit B-5 to
Form 8 Amendment No. 1 dated April 22, 1992 to Form 10
Registration Statement dated April 24, 1965 (Commission File No.
0-452) and incorporated herein by reference)
(3)(c) -Company's Amended and Restated Bylaws as amended through
February 23, 1994
(4) -[Note: No instruments defining the rights of holders of
long-term debt are being filed because no such instrument
authorizes a total amount of securities which exceeds 10% of
the total assets of the Company and its subsidiaries on a
consolidated basis. The Company hereby agrees to furnish a
copy of any such instrument to the Commission upon request.]
(9) -(not applicable)
(10)(a) -Amended and Restated Class B Rights Agreement (filed as
Exhibit 4 to Form 8 Amendment No. 1 dated April 22, 1992 to
Form 8-A registering Common Stock Purchase Rights dated January
23, 1991 (Commission File No. 0-452) and incorporated herein by
reference)
(10)(b) Amendment No. 1 to Amended and Restated Class B Rights Agreement
(filed as Exhibit 4 to Form 8 Amendment No. 2 dated October 2,
1992 to Form 8-A registering Common Stock Purchase Rights dated
January 23, 1991 (Commission File No. 0-452) and incorporated
herein by reference)
(10)(c) -Amendment No. 2 to Amended and Restated Class B Rights
Agreement (filed as Exhibit 4 to Form 8-A/A Amendment No. 3
dated June 22, 1993 to Form 8-A registering Common Stock
Purchase Rights dated January 23, 1991 (Commission File
No. 0-452) and incorporated herein by reference)
19
20
(3) Exhibits (continued):
(10)(d) -Class A Rights Agreement (filed as Exhibit 4 to Form 8-A
registering Class A Common Stock Purchase Rights dated April 22,
1992 (Commission File No. 0-452) and incorporated herein by
reference)
(10)(e) -Amendment No. 1 to Class A Rights Agreement (filed as Exhibit
4 to Form 8 Amendment No. 1 dated October 2, 1992 to Form 8-A
registering Class A Common Stock Purchase Rights dated April 22,
1992 (Commission File No. 0-452) and incorporated herein by
reference)
(10)(f) -Amendment no. 2 to Class A Rights Agreement (filed as Exhibit
4 to Form 8-A/A Amendment No. 2 dated June 22, 1993 to Form 8-A
registering Class A Common Stock Purchase Rights dated April 22,
1992 (Commission File No. 0-452) and incorporated herein by
reference)
(10)(g) -Exchange Agreement dated January 11, 1993 among the Company,
certain directors and shareholders of the Company, and others
(filed as Exhibit (10)(e) to Annual Report on Form 10-K for the
year ended December 31, 1992 (Commission File No. 0-452) and
incorporated herein by reference)
(10)(h) -Description of Death Benefit Plan (management contract or
compensatory plan or arrangement) (filed as Exhibit (10)(f) to
Annual Report on Form 10-K for the year ended December 31, 1992
(Commission File No. 0-452) and incorporated herein by reference)
(10)(i) -Management Incentive Plan effective January 1, 1994 (management
contract or compensatory plan or arrangement)
(10)(j) -Underwriting Agreement (U.S.) dated September 23, 1993 (filed
as Exhibit (10)(a) to Quarterly Report on Form 10-Q for the
quarter ended September 30, 1993 (Commission File No. 0-452) and
incorporated herein by reference)
(10)(k) -Underwriting Agreement (International) dated September 23, 1993
(filed as Exhibit (10)(b) to Quarterly Report on Form 10-Q for
the quarter ended September 30, 1993 (Commission File No. 0-452)
and incorporated herein by reference)
(10)(l) -Indemnity and Contribution Agreement dated September 23, 1993
(filed as Exhibit (10)(c) to Quarterly Report on Form 10-Q
for the quarter ended
20
21
September 30, 1993 (Commission File No. 0-452) and incorporated
herein by reference)
(3) Exhibits (continued):
(11) -(not applicable)
(12) -(not applicable)
(13) -Portions of Tecumseh Products Company Annual Report to
Shareholders for the year ended December 31, 1993, incorporated
by reference herein
(16) -(not applicable)
(18) -(not applicable)
(21) -Subsidiaries of the Company
(22) -(not applicable)
(23) -Independent Auditors' Consent
(24) -(not applicable)
(27) -(not applicable)
(28) -(not applicable)
(99) -(not applicable)
(b) No Reports on Form 8-K were filed by the Company during the last quarter
of the period covered by this Report.
21
22
TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
SCHEDULE V. PROPERTY, PLANT AND EQUIPMENT
for the years ended December 31, 1993, 1992 and 1991
(Dollars in Millions)
Caption>
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Other
Balance At Changes
Beginning Additions Add Balance at
Description of Period at Cost Retirements (Deduct) End of Period
----------- -------------------------------------------------------------------
1993:
Land and land improvements $ 8.3 $ 0.4 ($ 1.0) ($0.2) $ 7.5
Buildings and building improvements 103.8 6.6 (0.9) (3.2) 106.3
Machinery and equipment 524.4 46.0 (18.7) (13.0) 539.7
------- -------- ------ ------ -------
TOTAL $ 637.5 $ 53.0 ($20.7) ($16.4) $ 653.5
------- -------- ------ ------ -------
------- -------- ------ ------ -------
1992:
Land and land improvements $ 8.1 $ 0.4 $ - ($0.2) $ 8.3
Buildings and building improvements 109.3 0.6 (1.4) (4.7) 103.8
Machinery and equipment 500.3 57.1 (20.1) (11.9) 524.4
------- -------- ------ ------ -------
TOTAL $ 617.7 $ 58.1 ($21.5) ($16.8) $ 637.5
------- -------- ------ ------ -------
------- -------- ------ ------ -------
1991:
Land and land improvements $ 8.0 $ 0.5 ($0.4) $ - $ 8.1
Buildings and building improvements 103.8 11.9 (5.9) (0.5) 109.3
Machinery and equipment 476.4 76.2 (49.2) (3.1) 500.3
------- -------- ------ ------ -------
TOTAL $ 588.2 $ 88.6 ($55.5) ($3.6) $ 617.7
------- -------- ------ ------ -------
------- -------- ------ ------ -------
Notes:
(A) Column D includes normal sales and retirements of assets.
Retirements in 1991 include $21.8 million from the sales of assets
of Ilo Motorenwerk, GmbH, along with the sale of contract
machining business in Tecumseh, Michigan. Retirements also include
$15.8, $13.1, and $23.1 million write - off of fully depreciated
assets for 1993, 1992 and 1991, respectively.
(B) Column E represents the amount of adjustments resulting from
translating foreign currency to U.S. dollars pursuant to FASB
Statement No. 52
(C) Except for the certain highly automated and specialized machinery
which is depreciated using the units of production method,
depreciation is determined on the straight line method generally as
follows:
YEARS YEARS
----- -----
Land improvements 7-33 Factory equipment 3-10
Buildings 20-50 Transportation equipment 4-5
Building improvements 5-40 Office equipment 3-10
Machinery 3-13 Tooling 1-5
22
23
TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
SCHEDULE VI. ACCUMULATED DEPRECIATION, DEPLETION AND
AMORTIZATION OF PROPERTY, PLANT AND EQUIPMENT
for the years ended December 31, 1993, 1992 and 1991
(Dollars in Millions)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Additions Other
Balance At Charged to Changes
Beginning Costs and Add Balance at
Description of Period Expenses Retirements (Deduct) End of Period
----------- -------------------------------------------------------------------
1993:
Land and land improvements $ 2.2 $ 0.2 ($0.8) ($0.1) $ 1.5
Buildings and building improvements 39.8 4.3 (0.8) (1.5) 41.8
Machinery and equipment 272.6 46.3 (18.8) (10.3) 289.8
------- ------- ------ ------ -------
TOTAL $ 314.6 $ 50.8 ($20.4) ($11.9) $ 333.1
------- ------- ------ ------ -------
------- ------- ------ ------ -------
1992:
Land and land improvements $ 1.9 $ 0.4 $ - ($0.1) $ 2.2
Buildings and building improvements 37.1 4.5 (1.2) (0.6) 39.8
Machinery and equipment 254.4 46.8 (20.0) (8.6) 272.6
------- ------- ------ ------ -------
TOTAL $ 293.4 $ 51.7 ($21.2) ($9.3) $ 314.6
------- ------- ------ ------ -------
------- ------- ------ ------ -------
1991:
Land and land improvements $ 1.9 $ 0.2 ($0.2) $ - $ 1.9
Buildings and building improvements 36.7 4.2 (3.8) - 37.1
Machinery and equipment 244.7 52.6 (40.4) (2.5) 254.4
------- ------- ------ ------ -------
TOTAL $ 283.3 $ 57.0 ($44.4) ($2.5) $ 293.4
------- ------- ------ ------ -------
------- ------- ------ ------ -------
Notes:
(A) Column C for 1991 includes $9.0 million from the write-down of
certain long-term assets.
(B) Column D represents accumulated depreciation on normal sales and
retirements of assets. Retirements in 1991 include $12.7 million
from the sales of assets of Ilo Motorenwerk, GmbH, along with
the sale of contract machining business in Tecumseh, Michigan.
Retiremenets also include $15.8, $13.1, and $23.1 million write-off
of fully depreciated assets for 1993, 1992 and 1991, respectively.
(C) Column E represents the amount of adjustments resulting from
translating foreign currency to U.S. dollars pursuant to FASB
Statement No. 52.
23
24
TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
SCHEDULE VIII, VALUATION AND QUALIFYING ACCOUNTS
for the years ended December 31, 1993, 1992 and 1991
(Dollars in Millions)
Column A Column B Column C Column D Column E
-------- -------- ------------------------- -------- --------
Additions
-------------------------
Balance at Charged to Charged to Additions
Beginning Costs and Other and Balance at
Description of Period Expenses Accounts (Deductions) End of Period
----------- -------------------------------------------------------------------
Allowance for doubtful accounts,
deducted from accounts receivable
in the balance sheet: (A)
------
1993 $4.4 $1.7 ($0.8) $5.3
---- ---- ----- ----
---- ---- ----- ----
1992 $4.5 $0.8 ($0.9) $4.4
---- ---- ----- ----
---- ---- ----- ----
1991 $4.0 $1.0 ($0.5) $4.5
---- ---- ----- ----
---- ---- ----- ----
Product warranty valuation allowance: (B)
1993 $26.2 $24.5 ($20.2) $30.5
----- ----- ------- -----
----- ----- ------- -----
1992 $24.1 $21.4 ($19.3) $26.2
----- ----- ------- -----
----- ----- ------- -----
1991 $21.4 $21.1 ($18.4) $24.1
----- ----- ------- -----
----- ----- ------- -----
Self-insured risks valuation allowance: (B)
1993 $26.8 $11.3 ($10.5 $27.6
----- ----- ------- -----
----- ----- ------- -----
1992 $21.6 $16.0 (10.8) $26.8
----- ----- ------- -----
----- ----- ------- -----
1991 $20.4 $11.2 ($10.0) $21.6
----- ----- ------- -----
----- ----- ------- -----
Notes:
(A) Represents the total of accounts charged against the allowance for doubtful
accounts and adjustments from the translation of foreign currency.
(B) Represents the total of payments made during the year and adjustments from
the translation of foreign currency.
24
25
TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
SCHEDULE IX. SHORT-TERM BORROWINGS
for the years ended December 31, 1993, 1992 and 1991
(Dollars in Millions)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Maximum Average Weighted
Weighted Amount Amount Average
Balance Average Outstanding Outstanding Interest Rate
At End Interest During the During the During the
Description of Period Rate Period Period Period
----------- ------------------------------------------------------------------------
Notes payable to banks: (A) (B) (C)
1993 $10.5 5.5% $20.2 $14.1 5.7%
----- --- ----- ----- ---
----- --- ----- ----- ---
1992 $19.8 6.2% $28.4 $20.4 5.7%
----- --- ----- ----- ---
----- --- ----- ----- ---
1991 $21.1 6.4% $33.1 $21.0 7.9%
----- --- ----- ----- ---
----- --- ----- ----- ---
Notes:
(A) Notes payable to banks represent borrowings under revolving agreements.
(B) The average amount outstanding during the period was computed by dividing
the total of month-end outstanding principle balances by 12.
(C) The weighted average interest rate was computed by dividing the actual
interest expense by average short-term debt outstanding.
25
26
TECUMSEH PRODUCTS COMPANY AND SUBSIDIARIES
SCHEDULE X. SUPPLEMENTARY INCOME STATEMENT INFORMATION
for the years ended December 31, 1993, 1992 and 1991
(Dollars in Millions)
Column A Column B
-------- --------
Charged to
Costs and
Item Expenses
- ------------------------ -------------
Maintenance and repairs
1993 $37.9
-----
-----
1992 $38.6
-----
-----
1991 $33.6
-----
-----
Note:
Amounts for depreciation and amortization of intangible assets, taxes other than
payroll and income taxes, royalties and advertising costs have been omitted as
the amounts are less than one percent of total sales and revenues.
26
27
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.
TECUMSEH PRODUCTS COMPANY
By /s/ TODD W. HERRICK
--------------------------------
Todd W. Herrick
President and Chief Executive
Officer
Dated: March 23, 1994
27
28
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
Date
Signature Office of signing
--------- ------- ----------
Chairman of the March 23, 1994
___________________________ Board of Directors
Kenneth G. Herrick
/s/ TODD W. HERRICK President, Chief March 23, 1994
___________________________ Executive Officer
Todd W. Herrick (Principal Executive
Officer) and Director
/s/ PETER M. BANKS Director March 23, 1994
___________________________
Peter M. Banks
/s/ JON E. BARFIELD Director March 23, 1994
___________________________
Jon E. Barfield
/s/ JOHN H. FOSS Vice President, March 23, 1994
___________________________ Treasurer and Chief
John H. Foss Financial Officer
(Principal Accounting
and Principal Financial
Officer) and Director
/s/ J. RUSSELL FOWLER Director March 23, 1994
___________________________
J. Russell Fowler
/s/ JOHN W. GELDER Director March 23, 1994
___________________________
John W. Gelder
28
29
/s/ STEPHEN L. HICKMAN Director March 23, 1994
___________________________
Stephen L. Hickman
/s/ EDWARD C. LEVY JR. Director March 23, 1994
___________________________
Edward C. Levy Jr.
/s/ DEAN E. RICHARDSON Director March 23, 1994
___________________________
Dean E. Richardson
/s/ FREDERICK W. SCHWIER Director March 23, 1994
___________________________
Frederick W. Schwier
29
30
EXHIBIT INDEX
Exhibit
Number
- ------
(3)(c) -The Company's Amended and Restated Bylaws as amended
through February 23, 1994
(10)(i) -Management Incentive Plan effective January 1, 1994
(management contract or compensatory plan or arrangement)
(13) -Portions of The Company's Annual Report to Shareholders
for the year ended December 31, 1993, incorporated
by reference herein
(21) -Subsidiaries of the Company
(23) -Independent Auditors' Consent
30