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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-K
(Mark One)
[X]ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 [FEE REQUIRED] For the fiscal year ended December 31,1994
OR
[_]TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [NO FEE REQUIRED] For the transition period from to
Commission file number 1-1070
OLIN CORPORATION
(Exact name of registrant as specified in its charter)
Virginia 13-1872319
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
120 Long Ridge Road Stamford, 06904 (Zip Code)
Connecticut (Address of principal
executive offices)
Registrant's telephone number, including area code: (203) 356-2000
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SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
NAME OF EACH EXCHANGE
TITLE OF EACH CLASS ON WHICH REGISTERED
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Common Stock New York Stock Exchange
Chicago Stock Exchange
Pacific Stock Exchange
Common Stock Purchase Rights New York Stock Exchange
Chicago Stock Exchange
Pacific Stock Exchange
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SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: NONE
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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. [_]
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As of January 31, 1995, the aggregate market value of registrant's voting
stock held by non-affiliates of registrant was approximately $1,137,958,000.
The appraised value of the ESOP Preferred Shares as indicated in the most
recent independent appraiser's quarterly report was used in determining the
market value of such Shares.
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As of January 31, 1995, 21,518,831 shares of the registrant's common stock were
outstanding.
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DOCUMENTS INCORPORATED BY REFERENCE
PORTIONS OF THE FOLLOWING DOCUMENTS ARE INCORPORATED BY REFERENCE IN THIS FORM
10-K AS INDICATED HEREIN:
PART OF 10-K
DOCUMENT INTO WHICH INCORPORATED
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1994 Annual Report to Shareholders of Olin Parts I, II, and IV
Proxy Statement relating to Olin's 1995 Part III
Annual Meeting of Shareholders
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PART I
ITEM 1. BUSINESS
GENERAL
Olin Corporation is a Virginia corporation, incorporated in 1892, having its
principal executive offices in Stamford, Connecticut. It is a manufacturer
concentrated in chemicals, metals, defense-related products and services, and
ammunition. The chemicals segment is divided into three areas or divisions:
Chemicals, Chlor-Alkali and Electronic Materials. Chemicals includes flexible
urethanes, pool chemicals, biocides, acids, performance urethanes, and
surfactants and fluids. Chlor-alkali includes chlor-alkali products, sodium
hydrosulfite and high strength bleach products. Electronic Materials includes
image-forming and related specialty chemicals and electronic interconnect
materials and services. Products in the metals segment include copper and
copper alloy sheet, strip, rod, wire, tube and fabricated parts and stainless
steel strip. The defense and ammunition segment includes small, medium and
large caliber military ammunition, sporting ammunition and advanced technology
products and services for aerospace and defense customers.
Information as to the sales and assets attributable to each of Olin's
industry segments for each of the last ten fiscal years appears on page 19 of
the 1994 Annual Report to Shareholders of Olin ("Shareholders Report") and in
Exhibit 13 hereto. Such information with respect to the last three fiscal years
is incorporated by reference in this Report.* Information as to operating
income of Olin's industry segments for each of the last three fiscal years
contained in the Note "Segment Information" of the Notes to Financial
Statements on page 28 of the Shareholders Report and in Exhibit 13 hereto is
incorporated herein by reference.
The term "Olin" as used herein means Olin Corporation and its subsidiaries
unless the context indicates otherwise.
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* Except for material contained in Exhibit 13, the Shareholders Report is not
"filed" as part of this Report.
1
PRODUCTS AND SERVICES
The following is a list of the principal and certain other products and
services provided by Olin and its affiliates as of December 31, 1994 within
each industry segment. Principal products on the basis of annual revenues are
highlighted in bold face.
CHEMICALS
MAJOR RAW MATERIALS
PRODUCT LINE & COMPONENTS FOR
OR DIVISION PRODUCTS & SERVICES MAJOR END-USES PLANTS & FACILITIES* PRODUCTS/SERVICES
------------ ---------------------------- ----------------------- ---------------------------- ---------------------
Chlor-alkali
Chlor-alkali CHLORINE/CAUSTIC SODA Pulp & paper Augusta, GA salt, electricity
processing, chemical Charleston, TN
manufacturing, water McIntosh, AL
purification, Niagara Falls, NY (Niachlor)
manufacture of vinyl
chloride, bleach
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Other Chlor-alkali Sodium Hydrosulfite Paper, textile & clay Augusta, GA caustic soda,
Products bleaching Charleston, TN sulfuric acid,
Salto, Brazil sulfur dioxide
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HyPure(TM) products Industrial & Charleston, TN chlorine, caustic
institutional cleaners, soda
textile bleaching
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Chemicals
Urethanes TOLUENE DIISOCYANATE Lake Charles, LA di-nitrotoluene,
(TDI) Intermediate for Fukuoka, Japan (Kyodo chlorine, ammonia,
flexible foam used in TDI Limited Company) natural gas
------------------------ furniture, --------------------------------------------------------
Flexible polyols bedding, carpet Brandenburg, KY propylene oxide,
underlay, Punta Camacho, Venezuela ethylene oxide
transportation, (Etoxyl, C.A.)
packaging Ibaraki-ken, Japan
(Asahi-Olin Ltd.)
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Urethane systems Packaging & insulation Ibaraki-ken, Japan polyols, methylene
(Asahi-Olin Ltd.) diphenyl diisocyanate
Salto, Brazil
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Industrial CDB(R)** Chlorinated Sanitizers for S. Charleston, WV** chlorine, caustic
Isocyanurates isocyanurates industrial & household Salto, Brazil soda, urea
cleaners
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Virgin & regenerated Petroleum refining, Beaumont, TX sulfur, oxygen,
sulfuric acid, nitric acid agricultural chemicals Lake Charles, LA ammonia
Shreveport, LA
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Pool Chemicals HTH(R), SOCK-IT(R), Residential & Charleston, TN chlorine, lime,
PULSAR(R), SUPER SOCK-IT(R), commercial pool Igarassu, Brazil (Nordesclor caustic soda
DURATION(R) & CCH(R) sanitizing, water S.A.)
CALCIUM HYPOCHLORITE purification Kempton Park, S. Africa
(Aquachlor
(Proprietary) Ltd.)
Brisbane, Australia
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PACE(R), SUN(R)** Residential & Anaheim, CA chlorine, caustic
CHLORINATED commercial pool Livonia, MI** soda, urea
ISOCYANURATES sanitizing, water S. Charleston, WV**
purification Amboise, France
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Performance Aliphatic isocyanates Coatings, elastomers, Lake Charles, LA chlorine, specialty
Urethanes adhesives & sealants aliphatic amines
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Specialty polyols Elastomers, adhesives, Brandenburg, KY propylene oxide,
coatings, sealants & Ibaraki-ken, Japan ethylene oxide
rigid foam (Asahi-Olin Ltd.)
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* If site is not operated by Olin or a majority-owned, direct or indirect
subsidiary, name of joint venture, affiliate or operator is indicated. Sites
manufacture, distribute or market one or more of the identified products or
services.
** Subject to sale. See "Recent Developments."
2
CHEMICALS (CONT'D)
MAJOR RAW MATERIALS
PRODUCT LINE PRODUCTS PLANTS & COMPONENTS FOR
OR DIVISION & SERVICES MAJOR END-USES & FACILITIES* PRODUCTS/SERVICES
------------ ------------------------- ------------------------ -------------------------------- -------------------
Hydrazine Hydrazine solutions & Intermediate in blowing Lake Charles, LA chlorine, caustic
hydrazine-based agents & agricultural McIntosh, AL soda, ammonia,
propellants chemicals; boiler water dimethylamine,
treatment, rocket & monomethylamine
satellite propellants
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Biocides Omadine(R) Antidandruff agents Rochester, NY pyridine, zinc
IPBC Biocide, in shampoo, preservative Swords, Ireland salts, chlorine
Triadine(R) Biocide, in metal working fluids,
Zinc Omadine(R) coatings,
Biocide & Sodium adhesives, plastics, an-
Omadine(R) Biocide tifouling agent in
marine paints
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Custom chemicals Chemical intermediates Rochester, NY
manufacturing
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Organics Anionic & nonionic Household, industrial & Brandenburg, KY ethylene oxide,
surfactants, glycols, institutional cleaners, Punta Camacho, propylene oxide
glycol ethers, fluids basestocks for water Venezuela
based metal-
working/hydraulic fluids
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Electronic Materials
Electronic High purity acids & Used as process aids in Chandler, AZ various acids
Chemicals solvents, dopants, semi-conductor Nazareth, PA & solvents,
vapor deposition manufacturing Seward, IL ammonia-based
chemicals, specialty etchants
etchants
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Photoresists & polyimides Used as semiconductor Brandenburg, KY diazo compounds,
components and/or as East Providence, RI (OCG rubber polymers,
process aids in Microelectronic novolak polymers,
semiconductor Materials, Inc.) solvents,
manufacturing Tempe, AZ (OCG photoinitiators,
Microelectronic polyimide polymers
Materials, Inc.)
Zwijndrecht, Belgium (OCG
Microelectronic Materials N.V.)
Shizuoka, Japan (Fuji-Hunt
Electronics Technology
Co., Ltd.)
Basle, Switzerland (OCG
Microelectronic Materials AG)
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Dry liquid toner systems Used in electrostatic Berea, OH resins,
printers and offset Kallo, Belgium hydrocarbons
platemaking systems
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* If site is not operated by Olin or a majority-owned, direct or indirect
subsidiary, name of joint venture, affiliate or operator is indicated. Sites
manufacture, distribute or market one or more of the identified products or
services.
3
CHEMICALS (CONT'D)
MAJOR RAW MATERIALS
PRODUCT LINE PRODUCTS PLANTS & COMPONENTS FOR
OR DIVISION & SERVICES MAJOR END-USES & FACILITIES* PRODUCTS/SERVICES
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Interconnect High performance Integrated circuits & Manteca, CA specialty aluminum
Materials integrated circuit multi-chip modules for alloys & specialty
packaging materials computer, adhesives
telecommunications,
instrumentation &
automotive products
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High performance, All industry market New Bedford, MA all metals, metal
high reliability, segments; computer, (Aegis, Inc.) alloys, metal
hermetic metal communications, medical, matrix composites,
packages for the industrial, special alloys and
microelectronics instrumentation, glasses
industry automotive, consumer,
aerospace and military
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METALS
Olin Brass COPPER & COPPER ALLOY Electronic connectors, Bryan, OH copper, zinc &
SHEET & STRIP lead frames, electrical East Alton, IL other nonferrous
(STANDARD & HIGH components, Indianapolis, IN metals
PERFORMANCE) communications, Waterbury, CT
automotive, builders' Iwata, Japan (Yamaha-Olin
hardware, coinage Metal Corporation)
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Network of metals Electronic connectors, Alliance, OH copper & copper alloy
service centers electrical components, Caguas, PR sheet, strip, rod,
communications, Carol Stream, IL tube & steel &
automotive, builders' Allentown, PA aluminum strip
hardware, household Warwick, RI
products Watertown, CT
Yorba Linda, CA
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Beryllium copper strip High performance East Alton, IL beryllium copper
electronic applications
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POSIT-BOND(R) CLAD METAL Coinage strip & blanks East Alton, IL cupronickel,
copper & aluminum
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ROLLED COPPER FOIL, Printed circuit boards, Waterbury, CT copper, zinc
COPPERBOND(R) FOIL, electrical & electronic, & other nonferrous
STAINLESS STEEL STRIP automotive metals, stainless
steel
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COPPER ALLOY SEAMLESS Utility condensers, Cuba, MO copper, zinc & other
& WELDED TUBE industrial heat Indianapolis, IN nonferrous metals
exchangers,
refrigeration & air
conditioning, builders'
hardware, automotive
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Fabricated products Builders' hardware, East Alton, IL brass & stainless
cartridge cases, shaped Coventry, U.K. steel strip
charge cones, (Techniche Olin Limited)
transportation,
household & recreational
products
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Copper & copper alloy Fasteners, electrical Indianapolis, IN copper, zinc & other
rod & wire connectors, nonferrous metals
transportation, plumbing
& builders' hardware
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* If site is not operated by Olin or a majority-owned, direct or indirect
subsidiary, name of joint venture, affiliate or operator is indicated. Sites
manufacture, distribute or market one or more of the identified products or
services.
4
DEFENSE AND AMMUNITION
MAJOR RAW MATERIALS
PRODUCT LINE PRODUCTS PLANTS & COMPONENTS FOR
OR DIVISION & SERVICES MAJOR END-USES & FACILITIES* PRODUCTS/SERVICES
------------ ------------------------ ------------------------ -------------------- ---------------------------
Ordnance LARGE CALIBER MILITARY Used by tanks & Marion, IL various metals,
AMMUNITION, PROJECTILES artillery Red Lion, PA propellants,
& COMPONENTS St. Marks, FL sub-contracted
St. Petersburg, FL components
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MEDIUM CALIBER MILITARY Used by ground Downey, CA Ball Powder(R) propellant,
AMMUNITION & COMPONENTS vehicles, ships, Marion, IL explosives, various metals,
helicopters & aircraft sub-contracted components
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BALL POWDER(R) Small caliber commercial St. Marks, FL nitrocellulose
PROPELLANT, EXPLOSIVES ammunition, small,
& research & development medium & large caliber
for propulsion systems military ammunition
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Demilitarization of Contracts for disposal Marion, IL Government supplied
medium & large caliber of U.S. Government St. Petersburg, FL ammunition & rocket
ammunition & rocket surplus ammunition & motors
motors rocket motors
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Government-owned Maintenance of U.S. Army Baraboo, WI sub-contracted &
arsenal operations laid-away production government-supplied
(GOCO) plant components
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Gas generators Specialty solid- Marion, IL various metals, solid
propellant gas propellant ingredients
generators for missiles & subcontracted
& aircraft components
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Aerospace Pulsed power systems Pulsed high voltage gen- San Leandro, CA sub-contracted
erators, nuclear radia- components,
tion simulators, accel- including capacitors
erators, high frequency
modulators, military
hardware survivability
assessment, high power
microwave systems, flash
x-ray products
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Anti-armor systems Design, development & San Leandro, CA various metals,
testing of advanced Tracy, CA sub-contracted
antiarmor warhead sys- Lucerne, Switzerland components, explosive
tems for various anti- ingredients
tank missiles; volume
production of missile-
body metal parts; load,
assembly & pack of vari-
ous explosive devices
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Low-voltage power Design, development, Redmond, WA electronic piece
conditioning & test & production of parts, printed
controlling devices; aircraft, missile, wireboards, formed
digital test equipment; spacecraft, shipboard & metal parts
airborne electronic van-mounted power
products equipment & control
devices for military &
commercial applications;
design, development,
test & production of
microprocessor-based
stores test equipment
for military aircraft
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* If site is not operated by Olin or a majority-owned, direct or indirect
subsidiary, name of joint venture, affiliate or operator is indicated. Sites
manufacture, distribute or market one or more of the identified products or
services.
5
DEFENSE AND AMMUNITION (CONT'D)
MAJOR RAW MATERIALS
PRODUCT LINE PRODUCTS PLANTS & COMPONENTS FOR
OR DIVISION & SERVICES MAJOR END-USES & FACILITIES* PRODUCTS/SERVICES
------------ ------------------------ ------------------------ ------------------ -----------------------
Aerospace Hydrazine rocket Directional control Moses Lake, WA various metals,
(continued) engines; advanced rockets & propulsion Redmond, WA sub-contracted
propulsion systems & systems for satellite & components,
components; inflation space vehicles, launch hydrazine liquid
systems; specialty vehicles, tactical propellant, ammonium
solid-propellant missiles & projectiles; nitrate-, sodium
devices specialty solid- azide- and non-sodium
propellant gas azide based solid
generator-based devices propellant
for munitions ingredients
dispensing, fire
suppression, flotation &
other inflation systems
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Winchester(R) WINCHESTER(R) SPORTING Hunters & recreational East Alton, IL brass, lead, steel,
AMMUNITION (SHOT- shooters, law Geelong, Australia plastic, Ball Powder(R)
SHELLS, SMALL CALIBER enforcement agencies propellant,
CENTERFIRE & explosives
RIMFIRE AMMUNITION)
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Small caliber military Infantry and mounted East Alton, IL brass, lead, Ball
ammunition weapons Powder(R) propellant,
explosives
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Government-owned Maintenance and Independence, MO brass, lead, Ball
arsenal operation (GOCO) operation of U.S. Army Powder(R) propellant,
small caliber military explosives,
ammunition production government supplied
plant components
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Industrial products (8 Maintenance applications East Alton, IL brass, lead,
gauge loads & powder- in power & concrete Geelong, Australia plastic, Ball
actuated tool loads) industries, powder- Powder(R) propellant,
actuated tools in explosives
construction industry
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* If site is not operated by Olin or a majority-owned, direct or indirect
subsidiary, name of joint venture, affiliate or operator is indicated. Sites
manufacture, distribute or market one or more of the identified products or
services.
6
RECENT DEVELOPMENTS
In April 1994, Olin acquired the medium caliber ammunition business of
GenCorp's Aerojet--General Corporation's Ordnance Division. The acquisition
expanded Olin's medium caliber ammunition family and positioned Olin with a
complete line of improved 20MM, 25MM and 30MM ammunition as well as air
dispensed munitions products.
In May 1994, Olin issued approximately 2.2 million shares of its common stock
in an underwritten public offering at $46 per share. The net proceeds of the
offering were used to fund the aforementioned acquisition and to retire short
term debt.
In August 1994, Olin sold its conductive materials business to Acheson
Industries, including Olin's manufacturing facility in Ontario, California.
This business provided electrically conductive inks and coatings for membrane
switches and circuitry used in the electronics industry.
In December 1994, Olin sold its trichloroisocyanurate production facility in
Lake Charles, Louisiana to BioLab Inc., a subsidiary of Great Lakes Chemical
Corp.
In February 1995, Olin signed an agreement to sell its isocyanurate plant at
South Charleston, West Virginia and its Livonia, Michigan repackaging facility
to subsidiaries of Israel Chemicals Ltd. Previously, Olin entered into an
agreement to sell to Aqua Clear Industries, Inc. of Watervliet, New York, the
Sun(R) brand of swimming pool chemicals. Olin is required by an order of the
Federal Trade Commission (FTC) more fully discussed in Item 3(c) of this Form
10K, to divest itself of these assets. These sales are subject to the approval
of the FTC, among other things.
On March 1, 1995, the 2.76 million shares of Olin's Series A Conversion
Preferred Stock (PERCS(R)) converted into shares of Olin's Common Stock on a
one-for-one basis.
INTERNATIONAL OPERATIONS
Olin has sales offices and subsidiaries in various countries which support
the worldwide export of products from the United States as well as overseas
production facilities. In addition, Olin has manufacturing interests, both
direct and through joint ventures, in several foreign countries.
An Olin subsidiary in Ireland manufactures biocides for personal care and
industrial applications; a Brazilian subsidiary manufactures urethane systems
and Reductone(R) sodium hydrosulfite. An electronic materials subsidiary
located in Belgium packages toners which are marketed throughout Europe.
Hydrochim, S.A., a wholly-owned subsidiary, is a French isocyanurate repacking
operation. Etoxyl, C.A., a Venezuelan subsidiary, manufactures urethane polyols
and other specialty chemicals.
OCG Microelectronic Materials, a group of companies owned by Ciba-Geigy
Limited and Olin, markets photoresists, polyimides and other image forming
chemicals throughout Europe. A joint venture of OCG Microelectronic Materials,
Inc. and Fuji Photo Film Co., Ltd. manufactures photoresists in Japan and
markets them throughout the Far East.
Nordesclor S.A., a joint venture with S.A. Industrias Votorantim, a Brazilian
company, manufactures calcium hypochlorite. Through a joint venture with
Sentrachem Limited, Olin has an interest in a plant in South Africa for the
production of HTH(R) pool chemicals.
Olin has an interest in a plant in Japan for the production of urethane
polyols and other specialty chemicals through a joint venture with Asahi Glass
Company Ltd. Olin also has an interest in a plant in Venezuela for the
production of ethylene oxide and ethylene glycol through a joint venture with
Corimon, C.A., S.A.C.A., Petroquimica de Venezuela S.A. and the International
Finance Corporation. A joint venture of Olin and Asahi Glass Company Ltd. has
an interest in a TDI production plant in Japan with Mitsui Toatsu.
7
Yamaha-Olin Metal Corporation, a joint venture with Yamaha Corporation,
manufactures high-performance copper alloys in Japan for sale to the
electronics industry throughout the Far East.
Techniche Olin Limited, a joint venture with a U.K. company, manufactures
shaped charge cones in Coventry, England and markets them to prime contractors
for inclusion in armor piercing munitions for certain West European countries.
An Olin subsidiary loads and packs sporting and industrial ammunition in
Australia. The geographic segment data contained in the Note "Segment
Information" of the Notes to Financial Statements on page 28 of the
Shareholders Report and Exhibit 13 hereto are incorporated by reference in this
Report.
CUSTOMERS AND DISTRIBUTION
During 1994, no single nongovernmental customer accounted for more than 1.5%
of Olin's total consolidated sales and U.S. government sales accounted for 14%
of Olin's total consolidated sales. Products which Olin sells to industrial or
commercial users or distributors for use in the production of other products
constitute a major part of Olin's total sales. Some of its products, such as
pool chemicals, sporting ammunition and brass, are sold to a large number of
users or distributors, while others, such as certain industrial chemicals, are
sold in substantial quantities to a relatively small number of industrial
users.
Most of Olin's products and services are marketed primarily through its sales
force and sold directly to various industrial customers, the U.S. Government
and its prime contractors, to wholesalers and other distributors.
Chemicals. Principal customers of Olin's chemicals products include the pulp
and paper industries, vinyl chloride manufacturers, household and industrial
cleaner suppliers, municipal and industrial wastewater treatment companies,
specialty chemical manufacturers, flexible and rigid foam suppliers, automotive
companies, packaging suppliers, the refrigeration industry, manufacturers of
adhesives, coatings, elastomers and sealants, suppliers of various consumer
products including shampoos and swimming pool sanitizers, semiconductor
manufacturers, non-impact computer printer manufacturers and defense
contractors. Principal customers of Olin's interconnect materials business are
suppliers to semiconductor manufacturers and major computer and
telecommunications manufacturers.
Metals. Principal customers of Olin's copper and copper alloy strip, sheet,
rod, wire and seamless and welded tube include producers of electrical and
electronic equipment, builders' hardware and appliances, the plumbing,
automotive and air-conditioning industries and manufacturers of a variety of
consumer goods.
Olin manufactures cartridge brass for its ammunition business and for other
ammunition makers. Olin also serves numerous high-technology markets through a
thin-gauge reroll operation that produces stainless steels, high-temperature
alloys and glass sealing alloys, in addition to copper and copper alloys.
Posit-Bond(R) clad metal has made Olin a major supplier of metal to the U.S.
Mint. Olin also sells various alloys to foreign governments for coinage
purposes.
The metal products business is also focused on the electronics market,
providing high performance and high quality materials needed by the electronics
industry and other advanced technology customers. These materials include Olin-
developed proprietary alloys and Copperbond(TM) treated copper foil marketed to
the printed circuit industry.
Fabricated products are principally sold to ammunition manufacturers, the
U.S. Armed Forces, building product suppliers, household product manufacturers
and automotive manufacturers.
8
Defense and Ammunition. The principal customers of the Ordnance division are
the U.S. Department of Defense and certain foreign governments. Principal
customers of the Aerospace division are the U.S. Government, major defense
contractors, aerospace companies, telecommunications companies and certain
foreign governments. The principal users of the Winchester division's products
are recreational shooters, hunters, law enforcement agencies, the power and
concrete industries, the construction industry, the U.S. Armed Forces and
certain foreign governments.
GOVERNMENT SALES
U.S. Government sales were approximately $379 million in 1994, $354 million
in 1993 and $409 million in 1992.
Approximately 91% of such 1994 sales were to the Department of Defense or
agencies thereof. In addition, Olin operates certain Government owned plants,
including the Lake City Army Ammunition Plant in Independence, Missouri, for
which Olin receives fee income. Products and services sold to the Government,
to Government contractors or friendly foreign governments include ammunition,
propellant and specialty defense products and services. Olin also manufactures
and blends hydrazine based fuels for the Government for use as a propellant for
the Space Shuttle, satellites and expendable launch vehicles. The U.S. Mint
purchases cupronickel for nickels and Posit-Bond(R) clad metal for other U.S.
coins. Ammunition cups and strip are sold to Government contractors for
ultimate delivery to the Government.
Olin's Government business is performed under both cost reimbursement and
fixed price contracts. Cost reimbursement contracts provide for the
reimbursement of allowable costs plus the payment of a fixed fee, an incentive
fee based upon actual performance as compared to contractual targets, or an
award fee based upon unilateral evaluation by the Government. Olin's fixed
price contracts are either firm fixed price contracts or incentive contracts
under which Olin shares certain savings or overruns with the Government.
Government contracts generally have provisions for audit by the Government,
and cost reimbursement contracts have limitations on reimbursable costs.
Contracts may be terminated at the Government's convenience upon payment of
certain termination costs and, in some cases, profits.
Because several of its divisions engage in government contracting activities
and make sales to the U.S. Government, Olin is subject to extensive and complex
U. S. government procurement laws and regulations. These laws and regulations
provide for government audits and reviews of contract procurement, performance
and administration. Failure to comply, even inadvertently, with these laws and
regulations and with laws governing the export of munitions and other
controlled products and commodities, could subject Olin or one or more of its
businesses to civil and criminal penalties, and under certain circumstances,
suspension and debarment from future government contracts for a specified
period of time.
Changes in the strategic direction of defense spending, the timing of defense
procurements and specific defense program appropriation decisions may adversely
affect the performance of the Defense and Ammunition segment and Olin in future
years, including its income, liquidity, capital resources and financial
condition. The precise impact of these decisions will depend upon the timing
and size of changes and decisions, and Olin's ability to mitigate their impact
with new business, business consolidations or cost reductions. Olin currently
provides services to the U.S. Government in facilities management and ordnance
demilitarization and continues to pursue other business areas. In view of
continuing uncertainty regarding the strategy and priorities of the Department
of Defense, the historical financial information of the Defense and Ammunition
segment and, to a lesser extent, of Olin, may not be indicative of future
performance.
9
COMPETITION
Olin is in active competition with businesses producing the same or similar
products, as well as, in some instances, with businesses producing different
products designed for the same uses. With respect to certain product groups,
such as ammunition and copper alloys, and with respect to certain individual
products, such as pool chemicals, chlor-alkali and urethane products, Olin is
one of the largest manufacturers or distributors in the United States. With
respect to its many other products, Olin's share of total domestic sales varies
greatly.
EMPLOYEES
As of December 31, 1994, Olin had approximately 12,800 employees (excluding
approximately 1,300 employees at Government owned contractor operated
facilities), approximately 12,300 of whom were working in the United States and
approximately 500 of whom were working in foreign countries. A majority of the
hourly paid employees are represented, for purposes of collective bargaining,
by various labor unions. Some labor contracts extend for as long as four years,
but during each year new agreements must be negotiated in a number of Olin's
plants. One major labor contract was renewed in 1994. Five major collective
bargaining agreements at its East Alton, Illinois facility will expire in 1995.
While relations between Olin and its employees and their various
representatives are generally considered satisfactory, there can be no
assurance that new labor contracts can be concluded without work stoppages. No
major work stoppages have occurred in the last three years.
RESEARCH ACTIVITIES; PATENTS
Olin's research activities are conducted both on a product group and
corporate-wide basis at a number of facilities. Company sponsored research
expenditures were approximately $35 million during 1994, $41 million during
1993 and $39 million during 1992. Customer sponsored research expenditures
(primarily U.S. Government) were approximately $79 million in 1994, $88 million
in 1993 and $84 million in 1992.
Olin owns, or is licensed under, a number of patents, patent applications and
trade secrets covering its products and processes. Olin believes that, in the
aggregate, the rights under such patents and licenses are important to its
operations, but does not consider any patent or license or group thereof
related to a specific process or product to be of material importance when
viewed from the standpoint of Olin's total business.
RAW MATERIALS AND ENERGY
Olin purchases the major portion of its raw material requirements. The
principal basic raw materials required by Olin for its production of chemicals
are various hydrocarbons, salt, lime, electricity, propylene oxide, ethylene
oxide, natural gas, toluene, sulfur, ammonia and urea. Copper, zinc and various
other nonferrous metals are required for the metals business. Lead, brass and
propellant are the principal raw materials used in the ammunition business.
Olin's principal basic raw materials are typically purchased pursuant to
multiyear contracts. In addition, Olin uses many chemicals produced in its own
operations as raw materials, intermediates or processing agents in the
production of various other chemical products. In the manufacture of
ammunition, Olin uses a substantial percentage of its own output of smokeless
powder and cartridge brass. Additional information with respect to specific raw
materials is set forth in the table above under the caption entitled "Products
and Services."
Electricity is the predominant energy source for Olin's manufacturing
facilities. Most of Olin's facilities are served by utilities which generate
electricity principally from coal and nuclear power.
10
ENVIRONMENTAL AND TOXIC SUBSTANCES CONTROLS
The establishment and implementation of federal, state and local standards to
regulate air, water and land quality has affected and will continue to affect
substantially all of Olin's plants. Facilities and equipment to protect the
environment do not inherently produce any significant increase in product
capacity, efficiency or revenue, and their operation generally entails
additional expense and energy consumption. Federal legislation providing for
regulation of the manufacture, transportation, use and disposal of hazardous
and toxic substances has imposed additional regulatory requirements on
industry, particularly the chemicals industry. In addition, implementation of
environmental laws, such as the Resource Conservation and Recovery Act and the
Clean Air Act, has required and will continue to require new capital
expenditures and will increase operating costs. Olin employs waste minimization
and pollution prevention programs at its manufacturing sites. In order to help
finance the cleanup of waste disposal sites, the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended by the Superfund
Amendments and Reauthorization Act of 1986 ("Superfund"), imposes a tax on the
sale of various chemicals, including chlorine, caustic and certain other
chemicals produced by Olin, and on the disposal of certain hazardous wastes.
Olin is party to various governmental and private environmental actions
associated with waste disposal sites and manufacturing facilities. Associated
costs of investigatory and remedial activities are provided for in accordance
with generally accepted accounting principles governing probability and the
ability to reasonably estimate future costs. Environmental provisions charged
to income amounted to $17 million in 1994, $85 million in 1993 and $17 million
in 1992. The significant increase in 1993 resulted from expanded volumes of
contaminants uncovered while remediating a particular site, at which excavation
is now complete, combined with the availability of more definitive data from
progressing investigatory activities concerning both the nature and extent of
contamination and remediation alternatives at other sites. Charges to income
for investigatory and remedial efforts were material to operating results in
1994, 1993 and 1992 and may be material to net income in future years.
Cash outlays for environmental-related activities totalled $82 million in
1994 as compared with $93 million in 1993 and $103 million in 1992. During
1994, $45 million of these cash outlays were directed towards normal plant
operations for the disposal of waste and the installation, operation and
maintenance of pollution control equipment and facilities to ensure compliance
with mandated and voluntarily imposed environmental quality standards.
Comparable spending for 1993 and 1992 was $49 million and $62 million,
respectively. Included in the costs for normal plant operations were
environmental capital expenditures for pollution control equipment and
pollution abatement facilities. Spending for environmental capital expenditures
was $11 million in both 1994 and 1993 and $25 million in 1992. The 1992
environmental capital expenditures include construction costs for a waste water
treatment facility at Olin's Lake Charles plant. Historically, Olin has funded
its environmental capital expenditures through cash flow from operations and
expects to do so in the future.
Cash outlays for remedial and investigatory activities associated with former
waste sites and past operations were $37 million in 1994, $44 million in 1993
and $41 million in 1992. These amounts were not charged to income but instead
were charged to reserves established for such costs identified and expensed to
income in prior years.
Olin's estimated environmental liability at the end of 1994 was attributable
to 78 sites, 33 of which were on the National Priority List ("NPL"). Twelve
sites accounted for approximately 75% of such liability and, of the remaining
sites, no one site accounted for more than three percent of such liability. Six
of these twelve sites were in the investigatory stage of the remediation
process. In this stage, remedial investigation and feasibility studies are
conducted by either Olin, the United States Environmental Protection Agency
("EPA") or other potentially responsible parties ("PRP's") and a Record of
Decision ("ROD") or its equivalent has not been issued. At another three of the
twelve sites, a ROD or its equivalent has been issued by either the EPA or
responsible state agency and Olin either
11
alone, or as a member of a PRP group, was engaged in performing the remedial
measures required by that ROD. At the remaining three of the twelve sites, part
of the site is subject to a ROD and another part is still in the investigative
stage of remediation. All twelve sites were either former manufacturing
facilities or waste sites containing contamination generated by those
facilities.
Total environmental-related cash outlays for 1995 are estimated to be $93
million, of which $53 million is expected to be spent on normal plant
operations, including $15 million on capital projects, and $40 million on
investigatory and remedial efforts.
Annual environmental-related cash outlays for capital projects, site
investigation and remediation, and normal plant operations are expected to
range between $90-$105 million over the next several years. While Olin does not
anticipate a material increase in the projected annual level of its
environmental-related costs, there is always the possibility that such
increases may occur in the future in view of the uncertainties associated with
environmental exposures. Environmental exposures are difficult to assess for
numerous reasons, including the identification of new sites, developments at
sites resulting from investigatory studies, advances in technology, changes in
environmental laws and regulations and their application, the scarcity of
reliable data pertaining to identified sites, the difficulty in assessing the
involvement and financial capability of other potentially responsible parties
and Olin's ability to obtain contributions from other parties and the time
periods (sometimes lengthy) over which site remediation occurs. It is possible
that some of these matters (the outcomes of which are subject to various
uncertainties) may be resolved unfavorably against Olin.
See also Item 3, Legal Proceedings below, the Note "Environmental" of the
Notes to Financial Statements contained in the Shareholders Report and Exhibit
13 hereto, and "Management's Discussion and Analysis of Financial Condition and
Results of Operations" incorporated in this Report for additional information
regarding environmental matters affecting Olin.
ITEM 2. PROPERTIES
Olin has plants at 34 separate locations in 20 states and 4 plants in 4
foreign countries. Most plants are owned; a number of small plants and portions
of one major plant are leased. Listed under Item 1 above in the table set forth
under the caption "Products and Services" are the locations at or from which
Olin's products and services are manufactured, distributed or marketed by
segment.
Olin leases warehouses, terminals and distribution offices and space for
executive and branch sales offices and service departments throughout the
country and overseas.
ITEM 3. LEGAL PROCEEDINGS
(a) In December 1979, an action was commenced in the U.S. District Court in
New York by the United States against Occidental Chemical Corporation (then
known as Hooker Chemical & Plastics Corporation) ("Oxychem"), certain related
companies, Olin and the City of Niagara Falls, New York, alleging that chemical
wastes are migrating in violation of environmental laws or regulations from a
site in Niagara Falls where Oxychem and Olin own adjacent, inactive chemical
waste landfills. The United States is seeking injunctive relief and an order
requiring Oxychem and Olin, among other things, to secure the landfill site,
install a leachate collection system and treat whatever leachate is collected,
as well as an order requiring Oxychem and Olin to place $16.5 million in trust
or provide a bond to ensure that the site will be secured. The United States is
also seeking civil penalties for each day of alleged violation of the Clean
Water Act which currently has a maximum daily penalty of $25,000.
In November 1980, the State of New York filed a complaint as co-plaintiff in
the same action based upon essentially the same factual allegations as in the
suit brought by the United States. The State is seeking $100 million
compensatory damages and $100 million punitive damages. The State is seeking
$100 million compensatory damages and $100 million punitive damages. The State
is also requesting
12
a court order to abate the alleged nuisance and penalties of $10,000 per day
for alleged violations of each of four provisions of New York's Environmental
Conservation Law. In 1983, the State filed a motion to amend its complaint to
include a count under CERCLA (Comprehensive Environmental Response,
Compensation and Liability Act of 1980) alleging damage to natural resources.
In 1986, the Department of Justice filed a motion to amend its complaint to
include a CERCLA and SARA (Superfund Amendments and Reauthorization Act of
1986) count. Oxychem and Olin have filed in opposition to the motions and the
court has deferred a ruling on both motions.
The U.S. Environmental Protection Agency ("EPA") notified Olin and Oxychem of
an aggregate of $3,050,000 in agency oversight costs on the project.
Under a stipulation entered into by all parties in 1984, Olin and Oxychem
undertook a site remedial investigation which was completed in October 1988.
Subsequently, the parties entered into a further stipulation under which
Oxychem and Olin conducted a feasibility study of possible remedial measures.
Olin does not expect these stipulations to have any further effect on the
outcome of this matter. The remedial investigation and feasibility study was
completed in July 1990. On September 24, 1990, EPA issued a Proposed Remedial
Action Plan and on September 29, 1990 a Record of Decision ("ROD"). The EPA
selected remedy was estimated to cost $30 million. On September 30, 1991, the
EPA issued an administrative order directing Olin and Oxychem to implement the
remedy identified in the September 29, 1990 Record of Decision. Olin and
Oxychem have agreed to perform the remedy identified on such order. The cost of
any remedy is expected to be shared by Olin and Oxychem in an agreed-upon
proportion. Olin believes that any liability incurred by it in this matter will
not be materially adverse to its financial condition.
(b) In June 1987, the EPA issued a ROD recommending remedial actions and
ecological studies with respect to mercury contamination at the site of Olin's
former mercury cell chlor-alkali plant in Saltville, Virginia. In August 1987,
EPA, under Section 122 of CERCLA, asked Olin to undertake the work called for
in the ROD, and Olin agreed to do so. Olin's commitment was required to be
incorporated into a Consent Decree to be filed with a federal district court.
EPA's draft of the Consent Decree included a proposed $1.4 million Clean Water
Act penalty for past unpermitted discharges from a muck pond at the site, as
well as $570,000 in reimbursement of past EPA costs. In response to Olin's
request, EPA has agreed to reduce the costs to $456,000 and to sever the
penalty from the CERCLA action, making it the subject of separate negotiations
after execution of the Consent Decree. In 1988, the proposed $1.4 million Clean
Water Act penalty was severed from the Consent Decree entered into by Olin and
filed with the U.S. District Court for the Western District of Virginia, and
the EPA has taken no further action with respect to any proposed penalty.
Pursuant to the Decree, in November, 1988 Olin submitted to EPA, Region III, a
work plan for remedial action, including additional stormwater run-on control
around Pond #5 and construction of a wastewater treatment plant for the outfall
from Pond #5. Olin also submitted for EPA approval a work plan for further
remedial investigation of the impact of mercury from the site on groundwater
flowing into the North Fork Holston River and its sediment from the site to a
point twenty-seven miles downstream at the Tennessee border. During 1989 work
plans pursuant to the Consent Decree between EPA and Olin were approved by EPA.
Final payment of past EPA costs of $228,000 plus interest was made on November
21, 1989, in accordance with the Consent Decree.
On September 5, 1991, EPA advised Olin of potential liability for
contaminated soils which were being removed in conjunction with construction of
the Rte. 634 bridge in Saltville. Olin and EPA signed a Consent Order
authorizing Olin to do the soil removal, which has been completed.
Olin has completed the remedial investigation and feasibility study of the
former plant site, including Ponds # 5 and 6. On January 18, 1995, EPA issued a
Proposed Remedial Action Plan for a 30-day public comment period. The plan
calls for a cap to be constructed over Pond #5, and the excavation of soil and
sediment from the former chlorine plant site. Olin will be filing comments with
EPA in support of less expensive but it believes equally effective alternatives
for remediating the site.
13
On August 29, 1994, EPA notified Olin of the company's potential liability
with respect to the "Graveyard Dump Site", located north of the former plant
site. The site is relatively small, occupying about one half acre. EPA's
investigation found about 20 capacitors and miscellaneous debris scattered
around the site as well as evidence of PCB contamination in the soils.
Negotiations with EPA ensued and Olin and EPA signed an Administrative Order
by Consent, effective January 5, 1995, in which Olin agreed to perform certain
response activities at the site, primarily the removal and disposal of PCB
contaminated electrical equipment and soils. Planning for the work is underway
and it is expected that the work will take place in the winter/spring of 1995.
Olin believes that any liability incurred by it in this matter will not be
materially adverse to its financial condition.
(c) In December 1987, a Federal Trade Commission ("FTC") administrative law
judge ruled that Olin must divest the chlorinated isocyanurates business
acquired in 1985, which includes an isocyanurates manufacturing facility in
South Charleston, West Virginia, a packaging facility in Livonia, Michigan and
the Sun(R) brand trademark. The ruling stated that the acquisition was likely
to lessen competition in markets for chlorinated isocyanurates and calcium
hypochlorite dry swimming pool sanitizers. Olin appealed this decision to the
FTC. In July 1990, the FTC announced that it had issued an order denying Olin's
appeal and requiring Olin to divest itself of such business within one year of
the order becoming final following appeal. Olin appealed the FTC decision to
the U.S. Court of Appeals. The U.S. Court of Appeals upheld the FTC decision on
February 26, 1993. Olin petitioned for review by the U.S. Supreme Court and
such petition was denied. Olin unsuccessfully attempted to modify the FTC order
by proposing to the FTC that Olin sell its trichloroisocyanurate production
facility in Lake Charles, Louisiana to BioLab, Inc. (a sale which it ultimately
consummated in 1994) instead of selling its South Charleston facilities. Olin
is in the process of divesting the assets of this business to various entities
in compliance with the FTC order.
Olin believes that the divestment of this business will not be materially
adverse to its financial condition or results of operations.
(d) As part of the continuing environmental investigation by Federal, state
and local governments of waste disposal sites, Olin has entered into a number
of settlement agreements requiring it to contribute to the cost of the
investigation and cleanup of a number of sites. This process of investigation
and cleanup is expected to continue.
(e) Olin and its subsidiaries are defendants in various other legal actions
arising out of their normal business activities, none of which is considered by
management to be material.
14
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted to a vote of security holders during the three months
ended December 31, 1994.
Executive Officers of Olin Corporation as of March 1, 1995
SERVED AS AN
OLIN
NAME AND AGE OFFICE OFFICER SINCE
- ------------ ------ -------------
John W. Johnstone, Jr.
(62)..................... Chairman of the Board and Chief 1980
Executive Officer
Donald W. Griffin (57).... President and Chief Operating Officer 1983
Joseph M. Gaffney (48).... Senior Vice President, Corporate 1981
Planning and Development
James G. Hascall (56)..... Senior Vice President and President, 1985
Brass Group
James A. Riggs (58)....... Senior Vice President and Chief 1986
Financial Officer
Leon B. Anziano (52)...... Vice President and President, Chlor- 1993
Alkali Products Division
Gerald W. Bersett (54).... Vice President and President, 1993
Winchester Division
Robert A. Beyerl (52)..... Vice President and Controller 1994
Michael E. Campbell (47).. Vice President and President, Olin 1987
Electronic Materials Division
Angelo A. Catani (62)..... Vice President and President, Ordnance 1993
Division
Patrick J. Davey (51)..... Vice President and President, 1993
Chemicals Division
George B. Erensen (51).... Vice President, Taxes and Risk 1990
Management
Johnnie M. Jackson, Jr.
(49)..................... Vice President, General Counsel and 1995
Secretary
Peter C. Kosche (52)...... Vice President, Human Resources 1993
Janet M. Pierpont (47).... Vice President and Treasurer 1990
William M. Schmitt (53)... Vice President and President, Latin 1987
America and South Africa
William W. Smith (60)..... Vice President and President, 1993
Aerospace Division
No family relationship exists between any of the above named executive
officers or between any of them and any Director of Olin. Such officers were
elected to serve as such, subject to the By-Laws, until their respective
successors are chosen.
Each of the above-named executive officers, except L. B. Anziano, G. W.
Bersett, A. A. Catani, P. J. Davey, G. B. Erensen, P. C. Kosche, J. M.
Pierpont, R. A. Beyerl and W. W. Smith, has served Olin as an executive officer
for not less than the past five years.
Leon B. Anziano was elected a Corporate Vice President on April 29, 1993.
Prior to that time, since 1988, he has served Olin in the following management
capacities: Group Vice President & General Manager, Industrial Chemicals; Group
Vice President & General Manager, Urethanes; and President, Basic Chemicals
Division.
15
Gerald W. Bersett was elected a Corporate Vice President on April 29, 1993.
Prior to that time, since 1988, he has served Olin in the following management
capacities: Division Vice President and General Manager, Winchester and
President, Winchester Division.
Robert A. Beyerl was elected a Corporate Vice President and Controller on
April 26, 1994. Prior to that time, since 1989, he has served Olin in the
following management capacities: Director of Internal Audit; the Financial
Officer for the Defense Systems Group; and the Financial Officer for the
Chemicals Group.
Angelo A. Catani was elected a Corporate Vice President on April 29, 1993.
Prior to that time, since 1988, he has served Olin in a management capacity as
President, Ordnance Division.
Patrick J. Davey was elected a Corporate Vice President on April 29, 1993.
Prior to that time, since 1988, he has served Olin in the following management
capacities: Group Vice President, Water Products & Services; and President,
Performance Chemicals Division.
George B. Erensen was elected a Corporate Vice President on April 26, 1990.
Prior to that time, since 1988, he has served Olin in a management capacity as
Staff Vice President, Taxes and Risk Management.
Johnnie M. Jackson, Jr. was appointed a Corporate Vice President on February
23, 1995. Prior to that time, since 1989, he has served Olin in the following
capacities: General Counsel--Corporate and Secretary, Associate General
Counsel--Corporate Resources and Secretary and Deputy General Counsel.
Peter C. Kosche was elected a Corporate Vice President on April 29, 1993.
Prior to that time, since 1988, he has served Olin in the following management
capacities: General Manager, Pool Chemicals; and Division Vice President,
Materials Management.
Janet M. Pierpont was elected a Corporate Vice President and Treasurer on
April 26, 1990. Prior to that time, since 1988, she has served Olin in a
management capacity as Assistant Treasurer.
William W. Smith was elected a Corporate Vice President on April 29, 1993.
Prior to that time, since 1988, he has served Olin in a management capacity as
President, Aerospace Division.
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS
As of January 31, 1995, there were approximately 12,100 record holders of
Olin Common Stock.
Olin Common Stock is traded on the New York, Chicago and Pacific Stock
Exchanges.
Information concerning the high and low sales prices of Olin Common Stock and
dividends paid on Olin Common Stock during each quarterly period in 1994, 1993,
and 1992 appears on page 32 of the Shareholders Report and in Exhibit 13 hereto
and is incorporated herein by reference.
Among the provisions of Olin's agreements with its long-term lenders are
restrictions relating to payment of dividends and acquisition of common stock.
At December 31, 1994, retained earnings of approximately $224 million were not
so restricted.
ITEM 6. SELECTED FINANCIAL DATA
The information relating to the last five fiscal years contained under the
caption "Ten-Year Financial Summary" appearing on page 20 of the Shareholders
Report and in Exhibit 13 hereto is incorporated by reference in this Report.
16
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" appearing on pages 12 through 18 of the Shareholders Report (but
excluding the balloon graphs appearing on such pages) and in Exhibit 13 hereto
is incorporated by reference in this Report.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The consolidated financial statements of Olin Corporation and subsidiaries
and the related notes thereto together with the report thereon of KPMG Peat
Marwick LLP dated January 26, 1995, appearing on pages 21 through 30 of the
Shareholders Report and in Exhibit 13 hereto are incorporated by reference in
this Report.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
Not applicable.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The biographical information relating to Olin's Directors under the heading
"Item 1--Election of Directors" in the Proxy Statement relating to Olin's 1995
Annual Meeting of Shareholders ("Proxy Statement") is incorporated by reference
in this Report. See also the list of executive officers following Item 4 of
this Report. The information regarding compliance with Section 16 of the
Securities Exchange Act of 1934, as amended, contained in the last paragraph
under the heading "Security Ownership of Directors and Officers" in the Proxy
Statement is incorporated by reference in this Report.
ITEM 11. EXECUTIVE COMPENSATION
The information under the heading "Executive Compensation" in the Proxy
Statement (but excluding the Report of the Compensation and Nominating
Committee on Executive Compensation appearing on pages 11 through 14 of the
Proxy Statement and the graphs appearing on page 18 of the Proxy Statement) is
incorporated by reference in this Report. The information under the headings
"Additional Information Regarding the Board of Directors--Compensation of
Directors", and "Additional Information Regarding the Board of Directors--
Directors Retirement Plan" in the Proxy Statement is incorporated by reference
in this Report.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information concerning holdings of Olin stock by certain beneficial
owners contained under the heading "Certain Beneficial Owners" in the Proxy
Statement and the information concerning beneficial ownership of Olin stock by
Directors and officers of Olin under the heading "Security Ownership of
Directors and Officers" in the Proxy Statement are incorporated by reference in
this Report.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Not Applicable.
17
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a) 1. FINANCIAL STATEMENTS
Consolidated financial statements of Olin Corporation and subsidiaries and
the related notes thereto together with the report thereon of KPMG Peat Marwick
LLP dated January 26, 1995, appearing on pages 21 through 30 of the
Shareholders Report and in Exhibit 13 hereto are incorporated by reference in
this Report.
2. FINANCIAL STATEMENT SCHEDULES
Schedules not included herein are omitted because they are inapplicable or
not required or because the required information is given in the consolidated
financial statements and notes thereto.
Separate financial statements of 50% or less owned subsidiaries accounted for
by the equity method are not summarized herein and have been omitted because,
in the aggregate, they would not constitute a significant subsidiary.
3. EXHIBITS
Management contracts and compensatory plans and arrangements are listed as
Exhibits 10(a) through 10(aa) below.
3(a) Olin's Restated Articles of Incorporation as amended effective
January 15, 1992--Exhibit 3(a) to Olin's Form 10-K for 1991.*
(b) By-Laws of Olin as amended effective February 23, 1995.
4(a) Articles of Amendment designating ESOP Preferred Shares, par value
$1 per share--Exhibit 4 to Olin's Form 10-Q for the Quarter ended
June 30, 1989.*
(b) Rights Agreement dated as of February 27, 1986 between Olin and
Manufacturers Hanover Trust Company, Rights Agent--Exhibit 1 to
Olin's Form 8-A dated
February 28, 1986, covering Common Stock Purchase Rights.*
(c) Form of Senior Debt Indenture between Olin and Chemical Bank--
Exhibit 4(a) to Form 8-K dated June 15, 1992; Supplemental
Indenture dated as of March 18, 1994 between Olin and Chemical
Bank--Exhibit 4(c) to Registration Statement No. 33-52771; and
Prospectus Supplement dated June 17, 1992 to Prospectus dated June
16, 1992, with respect to Olin's 8% Senior Notes Due 2002 filed
under Registration Statement No. 33-4479.*
(d) Form of Subordinated Debt Indenture between Olin and Bankers Trust
Company--Exhibit 4(i) to Registration No. 33-4479; and Prospectus
Supplement dated June 17, 1987 to Prospectus dated February 3,
1987, with respect to Olin's 9 1/2% Subordinated Notes Due 1997
filed under Registration Statement No. 33-4479.*
(e) Credit Agreement, dated as of September 30, 1993, among Olin and
the banks named therein--Exhibit 4 to Olin's Form 10-Q for the
Quarter ended September 30, 1993.*
(f) Letters, dated December 15, 1993, amending the Credit Agreement,
dated as of September 30, 1993--Exhibit 4(f) to Olin's Form 10-K
for 1993.*
- --------
* Previously filed as indicated and incorporated herein by reference. Exhibits
incorporated by reference are located in SEC File No. 1-1070 unless otherwise
indicated.
18
Olin is party to a number of other instruments defining the rights of holders
of long-term debt. No such instrument authorizes an amount of securities in
excess of 10% of the total assets of Olin and its subsidiaries on a
consolidated basis. Olin agrees to furnish a copy of each instrument to the
Commission upon request.
10(a) 1980 Stock Option Plan for Key Employees of Olin Corporation and
Subsidiaries, as amended--Exhibit 10(a) to Olin's Form 10-K for
1991.*
(b) 1988 Stock Option Plan for Key Employees of Olin Corporation and
Subsidiaries as amended through February 23, 1995.
(c) Olin Corporation Performance Unit Plan, as amended April 24,
1986--Exhibit 10(a) to Olin's Form 10-Q for Quarter ended March
31, 1986.*
(d) Olin Corporate Incentive Compensation Plan--Exhibits 1(b) and 2(b)
to Registration No. 2-64811.*
(e) Olin Deferred Salary Plan, effective January 1, 1983--Exhibit
10(f) to Olin's Form 10-K for 1993.*
(f) Form of Directors' deferral plan--Exhibit 10(g) to Olin's Form 10-
K for 1993.*
(g) Amendments to Olin Corporation Performance Unit Plan, Corporate
Incentive Compensation Plan, Deferred Salary Plan and Directors'
deferral plan, adopted September 29, 1988--Exhibit 10(j) to Olin's
Form 10-K for 1988.*
(h) Amendment to Olin Corporation Performance Unit Plan, adopted May
25, 1989--Exhibit 10(b) to Olin's Form 10-Q for Quarter ended June
30, 1989.*
(i) Amendment to Olin Corporation Performance Unit Plan, adopted
September 26, 1991--Exhibit 10(j) to Olin's Form 10-K for 1991.*
(j) Amendment to Olin Corporation Performance Unit Plan, adopted
December 16, 1993--Exhibit 10(k) to Olin's Form 10-K for 1993.*
(k) Deferral elections with respect to certain acquisitions or "change
of control events"--Exhibit 10(h) to Olin's Form 10-K for 1986.*
(l) Olin Senior Executive Pension Plan with amendments.
(m) Olin Supplementary Contributing Employee Ownership Plan, effective
January 1, 1990 with amendments.
(n) Form of arrangement to credit 100 shares of Olin Common Stock to
certain Directors in each year from 1985 through 1994.
(o) Olin Corporation Key Executive Life Insurance Program--Exhibit
10(b) to Olin's
Form 10-Q for Quarter ended March 31, 1986.*
(p) Form of Olin Corporation Endorsement Split Dollar Agreement
(effective January 1, 1993)--Exhibit 10(s) to Olin's Form 10-K for
1992.*
(q) Form of executive agreement between Olin and certain executive
officers.
(r) Form of special severance agreement provided to certain employees
to become operative upon a "change in control event."
(s) Retirement Plan for Non-Employee Directors of Olin Corporation, as
amended through December 12, 1991--Exhibit 10(u) to Olin's Form
10-K for 1991.*
(t) Change in Control elections regarding both the Directors' deferral
plan and the arrangement to credit 100 shares of Olin Common Stock
to certain Directors--
Exhibit 10(z) to Olin's Form 10-K for 1989.*
(u) Olin 1991 Long Term Incentive Plan, as amended through February
23, 1995.
(v) Description of 1991 Performance Unit Awards granted under the Olin
1991 Long Term Incentive Plan--Exhibit 10(w) to Olin's Form 10-K
for 1991.*
- --------
* Previously filed as indicated and incorporated herein by reference. Exhibits
incorporated by reference are located in SEC File No. 1-1070 unless otherwise
indicated.
19
(w) Description of 1992 Performance Unit Awards granted under the
Olin 1991 Long Term Incentive Plan--Exhibit 10(z) to Olin's Form
10-K for 1992.*
(x) Description of Performance Share Awards granted under the Olin
1991 Long Term Incentive Plan--Exhibit 10 to Olin's Form 10-Q for
the quarter ended June 30, 1993.*
(y) Board Resolution adopted April 25, 1991 regarding payment of
deferred amounts--Exhibit 10(y) to Olin's Form 10-K for 1991.*
(z) Olin Corporation 1994 Stock Plan for Non-employee Directors--
Exhibit 10(a) to Olin's Form 10-Q for Quarter ended March 31,
1994.*
(aa) Olin Senior Management Incentive Compensation Plan--Exhibit 10(b)
to Olin's
Form 10-Q for Quarter ended March 31, 1994.*
11. Computation of Per Share Earnings.
12 (a) Computation of Ratio of Earnings to Fixed Charges (unaudited).
12 (b) Computation of Ratio of Earnings to Combined Fixed Charges and
Preferred Stock Dividends (unaudited).
13. Excerpts from the 1994 Annual Report to Shareholders.
21. List of Subsidiaries.
23. Consent of KPMG Peat Marwick LLP dated March 9, 1995.
27. Financial Data Schedule.
(b) REPORTS ON FORM 8-K
No reports on Form 8-K were filed during the quarter ended December 31, 1994.
- --------
* Previously filed as indicated and incorporated herein by reference. Exhibits
incorporated by reference are located in SEC File No. 1-1070 unless otherwise
indicated.
20
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.
Olin Corporation
Date: February 23, 1995 /s/ John W. Johnstone, Jr.
By...................................
JOHN W. JOHNSTONE, JR.
CHAIRMAN OF THE BOARD AND
CHIEF EXECUTIVE OFFICER
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 DATE INDICATED.
SIGNATURE TITLE
--------- -----
/s/
John W. Johnstone, Jr.
.....................................
JOHN W. JOHNSTONE, JR. Chairman of the Board, Chief Executive
Officer and Director (Principal Executive
Officer)
/s/
Robert R. Frederick
.....................................
ROBERT R. FREDERICK Director
/s/
Donald W. Griffin
.....................................
DONALD W. GRIFFIN Director
/s/
William W. Higgins
.....................................
WILLIAM W. HIGGINS Director
/s/
Robert Holland, Jr.
.....................................
ROBERT HOLLAND, JR. Director
/s/
Suzanne D. Jaffe
.....................................
SUZANNE D. JAFFE Director
.....................................
JACK D. KUEHLER Director
/s/
H. William Lichtenberger
.....................................
H. WILLIAM LICHTENBERGER Director
/s/
G. Jackson Ratcliffe, Jr.
.....................................
G. JACKSON RATCLIFFE, JR. Director
/s/
William L. Read
.....................................
WILLIAM L. READ Director
S-1
SIGNATURE TITLE
--------- -----
/s/
John P. Schaefer
.....................................
JOHN P. SCHAEFER Director
/s/
Irving Shain
.....................................
IRVING SHAIN Director
/s/
Robert A. Beyerl
.....................................
ROBERT A. BEYERL Vice President and Controller
(Chief Accounting Officer)
/s/
James A. Riggs
.....................................
JAMES A. RIGGS Senior Vice President and Chief Financial
Officer (Principal Financial Officer)
Date: February 23, 1995
S-2
LOGO PRINTED ON RECYCLED PAPER
Exhibit
No. Description
_______________
3(a) Olin's Restated Articles of Incorporation as amended effective
January 15, 1992-Exhibit 3(a) to Olin's Form 10-K for 1991.*
3(b) By-Laws of Olin as amended effective February 23, 1995.
4(a) Articles of Amendment designating ESOP Preferred Shares, par value
$1 per share-Exhibit 4 to Olin's Form 10-Q for the Quarter ended June 30,
1989.*
4(b) Rights Agreement dated as of February 27, 1986 between Olin and
Manufacturers Hanover Trust Company, Rights Agent-Exhibit 1 to Olin's
Form 8-A dated February 28, 1986, covering Common Stock Purchase Rights.*
4(c) Form of Senior Debt Indenture between Olin and Chemical Bank-Exhibit
4(a) to Olin's Form 8-K dated June 15, 1992; Supplemental Indenture dated
as of March 18, 1994 between Olin and Chemical Bank -- Exhibit 4(c) to
Registration Statement No. 33-52771; and Prospectus Supplement dated June
17, 1992 to Prospectus dated June 16, 1992, with respect to Olin's 8%
Senior Notes Due 2002 filed under Registration Statement No. 33-4479.*
4(d) Form of Subordinated Debt Indenture between Olin and Bankers Trust
Company-Exhibit 4(i) to Registration No. 33-4479; and Prospectus
Supplement dated June 17, 1987 to Prospectus dated February 3, 1987,
with respect to Olin's 9 1/2% Subordinated Notes Due 1997-filed under
Registration Statement No. 33-4479.*
4(e) Credit Agreement, dated as of September 30, 1993, among Olin and the
banks named therein-Exhibit 4 to Olin's Form 10-Q for the Quarter ended
September 30, 1993.*
4(f) Letters, dataed December 15, 1993, amending Credit Agreement, dated
as of September 30, 1993-Exhibit 4(f) to Olin's Form 10-K for 1993.*
10(a) 1980 Stock Option Plan for Key Employees of Olin Corporation and
Subsidiaries, as amended-Exhibit 10(a) to Olin's Form 10-K for 1991.*
10(b) 1988 Stock Option Plan for Key Employees of Olin Corporation and
Subsidiaries as amended through February 23, 1995.
10(c) Olin Corporation Performance Unit Plan, as amended April 24, 1986-
Exhibit 10(a) to Olin's Form 10-Q for Quarter ended March 31, 1986.*
10(d) Olin Corporation Incentive Compensation Plan-Exhibits 1(b) and 2(b)
to Registration No. 2-64811.*
10(e) Olin Deferred Salary Plan, effective January 1, 1983-Exhibit 10(f)
to Olin's Form 10-K for 1993.*
10(f) Form of Directors' deferral plan-Exhibit 10(g) to Olin's Form 10-k
for 1993.*
10(g) Amendments to Olin Corporation Performance Unit Plan, Corporate
Incentive Compensation Plan, Deferred Salary Plan and Directors' deferral
plan, adopted September 29, 1988-Exhibit 10(j) to Olin's Form 10-K for
1988.*
10(h) Amendment to Olin Corporation Performance Unit Plan, adopted May 25,
1989-Exhibit 10(b) to Olin's Form 10-Q for Quarter ended June 30, 1989.*
____
*Previously filed as indicated and incorporated herein by reference. Exhibits
incorporated by reference are located in SEC File No. 1-1070 unless
otherwise indicated.
Exhibit
No. Description
_______________
10(i) Amendment to Olin Corporation Performance Unit Plan, adopted
September 26, 1991-Exhibit 10(j) to Olin's Form 10-K for 1991.*
10(j) Amendment to Olin Corporation Performance Unit Plan, adopted
December 16, 1993-Exhibit 10(k) to Olin's Form 10-K for 1993.*
10(k) Deferral elections with respect to certain acquisitions or "change
of control events"-Exhibit 10(h) to Olin's Form 10-K for 1986.*
10(l) Olin Senior Executive Pension Plan with amendments.
10(m) Olin Supplementary Contributing Employee Ownership Plan, effective
January 1, 1990 with amendments.
10(n) Form of arrangement to credit 100 shares of Olin Common Stock to
certain Directors in each year from 1985 through 1994.
10(o) Olin Corporation Key Executive Life Insurance Program-Exhibit 10(b)
to Olin's Form 10-Q for Quarter ended March 31, 1986.*
10(p) Form of Olin Corporation Endorsement Split Dollar Agreement
(effective January 1, 1993)-Exhibit 10(s) to Olin's Form 10-K for 1992.*
10(q) Form of executive agreement between Olin and certain executive
officers
10(r) Form of special severance agreement provided to certain employees to
become operative upon "change in control event"
10(s) Retirement Plan for Non-Employee Directors of Olin Corporation, as
amended through December 12, 1991-Exhibit 10(u) to Olin's Form 10-K for
1991.*
10(t) Change in Control elections regarding both the Directors' deferral
plan and the arrangement to credit 100 shares of Olin Common Stock to
certain Directors-Exhibit 10(z) to Olin's Form 10-K for 1989.*
10(u) Olin 1991 Long Term Incentive Plan, as amended through February 23, 1995.
____
*Previously filed as indicated and incorporated herein by reference. Exhibits
incorporated by reference are located in SEC File No. 1-1070 unless otherwise
indicated.
Exhibit
No. Description
_______________
10(v) Description of 1991 Performance Unit Awards granted under the Olin
1991 Long Term Incentive Plan-Exhibit 10(w) to Olin's Form 10-K for
1991.*
10(w) Description of 1992 Performance Unit Awards granted under the Olin 1991
Long Term Incentive Plan-Exhibit 10(z) to Olin's Form 10-K for 1992.*
10(x) Description of Performance Share Awards granted under the Olin 1991
Long Term Incentive Plan-Exhibit 10 to Olin's Form 10-Q for the Quarter
ended June 30, 1993.*
10(y) Board Resolution adopted April 25, 1991 regarding payment of
deferred amounts-Exhibit 10(y) to Olin's Form 10-K for 1991.*
10(z) Olin Corporation 1994 Stock Plan for Non-Employee Directors-Exhibit
10(a) to Olin's Form 10-Q for the Quarter ended March 31, 1994.*
10(aa) Olin Senior Management Incentive Compensation Plan-Exhibit 10(b) to
Olin's Form 10-Q for the Quarter ended March 31, 1994.*
11 Computation of Per Share Earnings.
12(a) Computation of Ratio of Earnings to Fixed Charges (Unaudited).
12(b) Computation of Ratio of Earnings to Combined Fixed Charges and
Preferred Stock Dividends (Unaudited).
13 Excerpts from the 1994 Annual Report to Shareholders.
21 List of Subsidiaries.
23 Consent of KPMG Peat Marwick LLP, dated March 9, 1995.
27 Financial Data Schedule.
____
*Previously filed as indicated and incorporated herein by reference. Exhibits
incorporated by reference are located in SEC File No. 1-1070 unless otherwise
indicated.