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SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended December 28, 2003
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _______________ to _______________
Commission file number 1-4347
ROGERS CORPORATION
[Exact name of Registrant as specified in its charter]
Massachusetts 06-0513860
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Technology Drive
P.O. Box 188
Rogers, Connecticut 06263-0188
(Address of principal executive offices) (Zip Code)
(860) 774-9605
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange on
Title of each class which registered
------------------- -----------------------------
Capital Stock, $1 Par Value New York Stock Exchange, Inc.
Rights to Purchase Capital Stock New York Stock Exchange, Inc.
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the Registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter periods that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
-------- --------
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
Indicate by check mark whether the Registrant is an accelerated filer (as
defined in Exchange Act Rule 12b-2) Yes X No
The aggregate market value of the voting common equity held by non-affiliates of
the Registrant as of Rogers' most recently completed second fiscal quarter, June
29, 2003, was approximately $516,832,034. Rogers has no non-voting common
equity.
The number of shares of Capital Stock, $1 par value, outstanding as of February
28, 2004 was 16,495,072.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Registrant's annual report to shareholders for the fiscal year
ended December 28, 2003 are incorporated by reference into Parts I and II.
Portions of the proxy statement for the Registrant's 2004 annual meeting of
stockholders to be held April 29, 2004, are incorporated by reference into Part
III.
TABLE OF CONTENTS
PART I
Item Page
1. Business 1
2. Properties 6
3. Legal Proceedings 6
4. Submission of Matters to a Vote of Security Holders 7
PART II
5. Market for Registrant's Common Equity, Related Stockholder
Matters and Issuer Purchases of Equity Securities 8
6. Selected Financial Data
7. Management's Discussion and Analysis of Financial Condition
and Results of Operations 8
7A. Quantitative and Qualitative Disclosures About Market Risk 8
8. Financial Statements and Supplementary Data 8
9. Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure 8
9a. Controls and Procedures 8
PART III
10. Directors and Executive Officers of the Registrant 9
11. Executive Compensation 9
12. Security Ownership of Certain Beneficial Owners and
Management and Related Stockholder Matters 9
13. Certain Relationships and Related Transactions 9
14. Principal Accountant Fees and Services 9
PART IV
15. Exhibits, Financial Statement Schedules and Reports
on Form 8-K 10
SIGNATURES
Signatures 14
Certifications Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002 17
Certifications Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002 20
PART I
Item 1. BUSINESS
GENERAL
Rogers Corporation (the "Company"), founded in 1832, is one of the oldest
publicly traded U.S. companies in continuous operation. The Company has adapted
its products over the years to meet changing market needs, moving from specialty
paperboard to transformer boards for electrical insulation, and now
predominantly to a range of specialty polymer composite materials for
communications, imaging, computer, transportation, and consumer applications.
New leadership in 1992 restructured the Company to focus on its materials based
businesses, which include printed circuit materials, high performance foams, and
polymer materials and components. The Company divested most of its electronic
components related businesses and management, operations, sales and marketing,
and technology development activities were redirected to efforts intended to
grow the materials based businesses. In so doing, the Company takes advantage of
its core competencies in polymers, fillers, and adhesion, and applies its
related materials technologies to identified market needs. Materials based
businesses were the core businesses responsible for the Company's strong growth
in the 1960's and 1970's, and provided most of the Company's profits in the
1980's. During that time, the profits from the materials based businesses were
often offset by substantial losses in the Company's former electronic components
businesses.
The materials based businesses are guided by clearly developed strategic
business plans for profitable growth. The current focus is on worldwide markets
for printed circuit materials, high performance foams, and polymer materials and
components. An increasingly large percentage of these materials are going into
growing high technology applications, such as cell telephone base stations and
antennas, handheld wireless devices and satellite television receivers.
BUSINESS SEGMENT FINANCIAL AND GEOGRAPHIC INFORMATION
"Business Segment and Geographic Information" on pages 54-55 of the annual
report to shareholders for the year ended December 28, 2003, is incorporated
herein by reference.
PRODUCTS
Rogers Corporation manufactures and sells specialty polymer composite materials
and components which it develops for growing markets and applications around the
world. The Company has three business segments: High Performance Foams, Printed
Circuit Materials, and Polymer Materials and Components. The Company's products
are based on its core technologies in polymers, fillers, and adhesion. Most
products are proprietary, or incorporate proprietary technology in their
development and processing, and are sold under the Company's valuable brand
names.
HIGH PERFORMANCE FOAMS
High Performance Foams include urethane foams, silicone foams, and polyolefin
foams. The Company's High Performance Foams have characteristics that offer
functional advantages in many market applications, and serve to differentiate
the Company's products from competitors' materials and from other commonly
available materials.
High Performance Foams are sold to fabricators, printers and original equipment
manufacturers for applications in imaging, communications, computer,
transportation, consumer and other markets. Trade names for the Company's High
Performance Foams include: PORON(R) urethane foams used for making high
performance gaskets and seals in vehicles, communications devices, computers and
peripherals; PORON cushion insole materials for footwear and related products;
PORON healthcare and medical materials for body cushioning and orthotic
appliances; BISCO(R) silicone foams used for making flame retardant gaskets and
seals in aircraft, trains, cars and trucks, and for shielding extreme
temperature or flame; and R/bak(R) compressible printing plate backing and
mounting products for cushioning flexographic plates for printing on packaging
materials. The Company's polyolefin foams are used in a range of industrial and
consumer applications.
One of the Company's joint ventures extends and complements the Company's
worldwide business in High Performance Foams. Rogers Inoac Corporation ("RIC"),
a joint venture with Japan-based Inoac Corporation, manufactures high
performance PORON urethane foam materials in Mie and Nagoya, Japan.
1
PRINTED CIRCUIT MATERIALS
Printed Circuit Materials include printed circuit board laminates for high
frequency circuits, flexible printed circuit board laminates for high
performance flexible circuits, and polyester based industrial laminates. The
Company's Printed Circuit Materials have characteristics that offer performance
and other advantages in many market applications, and serve to differentiate the
Company's products from competitors' products and from other commonly available
materials.
Printed Circuit Materials are sold principally to independent and captive
printed circuit board manufacturers who convert the Company's laminates to
custom printed circuits.
The polymer based dielectric layers of the Company's high frequency circuit
board laminates are proprietary materials that provide highly specialized
electrical and mechanical properties. Trade names for the Company's high
frequency printed circuit board materials include RO3000(R), RO4000(R),
DUROID(R), RT/duroid(R), ULTRALAM(R), RO2800(R) and TMM(R) laminates. All of
these laminates are used for making circuitry that receive, transmit, and
process high frequency communications signals. Each laminate addresses specific
needs and applications within the communications market. High frequency circuits
are used throughout the equipment and devices that comprise wireless
communications systems, including cellular communications, digital cellular
communications, paging, direct broadcast television, global positioning, mobile
radio communications, and radar.
The flexible circuit materials that the Company manufactures are called
R/flex(R) materials. They are mainly used to make interconnections for handheld
and laptop computers, portable electronic devices, and hard disk drives. The
performance characteristics of R/flex materials differentiate these laminates
from commonly available flexible circuit materials.
Industrial laminates are manufactured by the Company under the Induflex(R) trade
name. These polyester based laminates, with thin aluminum and copper cladding,
are sold mostly to telecommunications and data communication cable manufacturers
for shielding electromagnetic and radio frequency interference, and to
automotive component manufacturers for making flat, etched-foil heaters.
The adhesiveless flexible circuit materials that the Company sold to Hutchinson
Technology Incorporated ("HTI"), for making trace suspension assemblies in
magneto resistive hard disk drives, are called SSLAM materials. SSLAM materials
are manufactured by Mitsui Chemicals, Inc. of Japan. Effective January 3, 2000
the Company started a joint venture with Mitsui Chemicals, Inc. to eventually
manufacture this flexible circuit board laminate in Chandler, Arizona. Beginning
in 2000, this joint venture, Polyimide Laminate Systems, LLC ("PLS") made these
sales to HTI rather than having the resale go through the Company.
Rogers Chang Chun Technology, Co., Ltd. ("RCCT"), the Company's joint venture
with Chang Chun Plastics, Co., Ltd., which was established in late 2001 to
manufacture flexible circuit material for customers in Taiwan, saw its first
sales in 2002 and continued to grow in 2003 as RCCT had significant application
wins in late 2003 in the Taiwan market that the Company expects will drive
additional sales in fiscal 2004. The Company also plans to utilize this facility
to alleviate some of the manufacturing capacity constraints it has experienced
due to the overall increase in the Company's business.
POLYMER MATERIALS AND COMPONENTS
Polymer Materials and Components include high performance elastomer components,
composite materials, power distribution busbars, electroluminescent lamps and
inverters. The Company's Polymer Materials and Components have characteristics
that offer functional advantages in many market applications, and serve to
differentiate the Company's products from those of its competitors' and from
other commonly available products.
Elastomer components are sold to original equipment manufacturers for
applications in transportation, communications, imaging, computer, consumer and
other markets. Trade names for the Company's elastomer components include:
NITROPHYL(R) floats for fill level sensing in fuel tanks, motors, and storage
tanks; and ENDUR(R) elastomer rollers and belts for document handling in
copiers, computer printers, mail sorting machines and automated teller machines.
Power distribution bus bars are manufactured by the Company under the MEKTRON(R)
trade name. Bus bars are sold to manufacturers of high voltage electrical
traction systems for use in mass transit and industrial applications, and to
manufacturers of communication and computer equipment.
2
The Company's nonwoven composite materials are manufactured for medical padding,
industrial pre-filtration applications, and as consumable supplies in the
lithographic printing industry.
In the fourth quarter of 2003, the Company acquired the remaining interest in
its former joint venture, Durel Corporation, from 3M. Durel manufactures
DUREL(R) electroluminescent lamps ("EL lamps") and phosphor, in Chandler,
Arizona. The Company also designs and sells inverters that power EL lamps.
BACKLOG
Excluding joint venture activity, the backlog of firm orders for High
Performance Foams was $4.8 million at December 28, 2003 and $5.8 million at
December 29, 2002. The backlog of firm orders for Printed Circuit Materials was
$23.6 million at December 28, 2003 and $7.3 million at December 29, 2002. The
backlog of firm orders for Polymer Materials and Components was $19.9 million at
December 28, 2003 and $8.6 million at December 29, 2002. The increase in 2003 is
primarily due to the acquisition of Durel and growth in orders in the Printed
Circuit Materials segment.
RAW MATERIALS
The manufacture of High Performance Foams, Printed Circuit Materials and Polymer
Materials and Components requires a wide variety of purchased raw materials.
Some of these raw materials are available only from limited sources of supply
that, if discontinued, could interrupt production. When this has occurred in the
past, the Company has purchased sufficient quantities of the particular raw
material to sustain production until alternative materials and production
processes could be qualified with customers. Management believes that similar
responses would mitigate any raw material availability issues in the future.
EMPLOYEES
The Company employed an average of 229 people in the High Performance Foams
operations, 445 people in the Printed Circuit Materials operations and 523
people in the Polymer Materials and Components operations.
SEASONALITY
In the Company's opinion, there is no material concentration of products or
markets within the business that is seasonal in nature except for some minor
seasonality for those products sold into satellite television receivers due to
holiday build-up and cellular telephones due to the annual new model launch
timetable which can vary slightly year to year in terms of timing and impact.
CUSTOMERS & MARKETING
The Company's products were sold to approximately 4,400 customers worldwide in
2003. Although the loss of all the sales made to any one of the Company's major
customers would require a period of adjustment during which the business of a
segment would be adversely affected, the Company believes that such adjustment
could be made over a period of time. The Company also believes that its business
relationships with the major customers within all of its segments are generally
favorable, and that it is in a good position to respond promptly to variations
in customer requirements. However, the possibility exists of losing all the
business of any major customer as to any product line. Likewise, the possibility
exists of losing all the business of any single customer.
The Company markets its full range of products throughout the United States and
in most foreign markets. Over 90% of the Company's sales are sold through the
Company's own domestic and foreign sales force, with the balance sold through
independent agents and distributors.
COMPETITION
There are no firms that compete with the Company across its full range of
product lines. However, each of the Company's products faces competition in each
business segment in domestic and foreign markets. Competition comes from firms
of all sizes and types, including those with substantially more resources than
the Company. The Company's strategy is to offer technically advanced products
that are price competitive in their markets, and to link the offerings with
market knowledge and customer service. The Company believes this serves to
differentiate the Company's products in many markets.
3
RESEARCH & DEVELOPMENT
The Company has many domestic and foreign patents and licenses and has
additional patent applications on file related to all business segments. In some
cases, the patents result in license royalties. The patents are of varying
duration and provide some protection. Although the Company vigorously defends
its patents, the Company believes that its patents have most value in
combination with its equipment, technology, skills, and market position. The
Company also owns a number of registered and unregistered trademarks that it
believes to be of importance.
ENVIRONMENTAL REGULATION
The nature and scope of the Company's business bring it in regular contact with
the general public and a variety of businesses and government agencies. Such
activities inherently subject the Company to the possibility of litigation,
including environmental matters that are defended and handled in the ordinary
course of business. The Company has established accruals for matters for which
management considers a loss to be probable and reasonably estimable.
The Company does not believe that the outcome of any of these matters will have
a material adverse effect on its financial position nor has the Company had any
material recurring costs or capital expenditures relating to environmental
matters, except as disclosed in Item 3 of this report. However, there can be no
assurances that the ultimate liability concerning these matters will not have a
material adverse effect on the Company.
AVAILABLE INFORMATION
The Company's internet website is http://rogerscorporation.com/. The Company
makes available free of charge on its website its annual reports on Form 10-K,
quarterly reports on Form 10-Q, current reports on Form 8-K, reports filed
pursuant to Section 16 and amendments to those reports as soon as reasonably
practicable after their filing with, or furnishing to, the Securities and
Exchange Commission.
4
EXECUTIVE OFFICERS OF THE REGISTRANT
All officers hold office until the first meeting of the Board of Directors
following the annual meeting of stockholders or until successors are elected.
There are no family relationships between or among executive officers and
directors of the Company.
Name, Age and Present Served in Present
Position Prior Business Experience in Past Five Years Position Since
- ---------------------------------- ------------------------------------------------------------ ----------------------
Walter E. Boomer, 65 President and Chief Executive Officer of the Company from April 2002
Chairman of the Board of March 1997 to April 2002
Directors and Chief Executive
Officer
Robert D. Wachob, 56 Executive Vice President of the Company from January 2000 April 2002
President and Chief Operating to April 2002; Senior Vice President, Sales and Marketing
Officer of the Company from May 1997 to January 2000.
James M. Rutledge, 51 Vice President, Finance and Chief Financial Officer of the December 2002
Vice President, Finance and Company from June 2002 to December 2002; Vice President,
Chief Financial Officer and Finance and Chief Financial Officer and Secretary of the
Treasurer Company from January 2002 to June 2002; Chief Financial
Officer of Baldwin Technology Company, Inc. from January
2000 to July 2001; Vice President Finance and Taxes of
Rayonier, Inc. from March 2000 to January 2000; Vice
President and Treasurer of Witco Corporation from October
1990 to March 1999.
Robert C. Daigle, 40 Vice President and Manager, Advanced Circuit Materials October 2003
Vice President of Research and Division of the Company from October 2001 to October 2003;
Development and Chief Technology Manager, Advance Circuit Materials Division of the Company
Officer from June 2001 to October 2001; Manager, Microwave
Materials Division of the Company from May 1997 to June
2001
John A. Richie, 56 October 1994
Vice President, Human Resources
Robert M. Soffer, 56 Vice President, Secretary, Treasurer and Clerk of the December 2002
Vice President and Secretary and Company from June 2002 to December 2002; Vice President,
Clerk Assistant Secretary, Treasurer and Clerk of the Company
from April 2000 to June 2002; Treasurer and Assistant
Secretary and Clerk of the Company from February 1992 to
April 2000.
Paul B. Middleton, 36 Division Controller for Cooper Industries from November December 2001
Corporate Controller 1999 to December 2001; Internal Audit Manager of Cooper
Industries from December 1997 to November 1999; Audit
Manager for KPMG Peat Marwick from April 1996 to December
1997.
5
Item 2. PROPERTIES
The Company owns its properties, except as noted below. The Company considers
that its properties are well maintained, in good operating condition, and
suitable for its current and anticipated business.
Floor Space
(Square Feet) Type of Facility Leased/Owned
--------------- ---------------- ------------
High Performance Foams
- ----------------------
Woodstock, Connecticut 152,000 Manufacturing Owned
Carol Stream, Illinois 215,000 Manufacturing Owned
Printed Circuit Materials
- -------------------------
Chandler, Arizona 156,000 Manufacturing Owned
4,000 Warehouse Owned
11,000 Rental Property Owned
Chandler, Arizona 142,000 Manufacturing Owned
Evergem, Belgium 80,000 Manufacturing Owned
Ghent, Belgium 113,000 Manufacturing Owned
Polymer Materials and Components
- --------------------------------
South Windham, Connecticut 88,000 Manufacturing Owned
Rogers, Connecticut 290,000 Manufacturing Owned
Ghent, Belgium 96,000 Manufacturing Owned
Chandler, Arizona 120,000 Manufacturing Owned
Korea 10,000 Manufacturing Leased through 2/06
Other
- -----
Rogers, Connecticut 116,000 Corporate Headquarters/
Research &
Development Owned
Chandler, Arizona 160,000 Manufacturing Owned
Suzhou, China 93,000 Manufacturing Leased through 6/05
Suzhou, China 93,000 Manufacturing Leased through 6/05
Tokyo, Japan 2,000 Sales Office Leased through 9/04
Wanchai, Hong Kong 1,000 Sales Office Leased through 4/04
Guangzhou, China 1,000 Sales Office Leased through 9/04
Taipei, Taiwan, R.O.C. 1,000 Sales Office Leased through 9/04
Seoul, Korea 1,000 Sales Office Leased through 2/08
50 Warehouse Leased through 5/04
Singapore 1,000 Sales Office Leased through 6/04
Shanghai, China 1,000 Sales Office Leased through 9/05
Item 3. LEGAL PROCEEDINGS
The Company is subject to federal, state, and local laws and regulations
concerning the environment and is currently engaged in proceedings related to
such matters.
The Company is currently involved as a potentially responsible party ("PRP") in
four active cases involving waste disposal sites. These proceedings are
generally at a stage where it is still not possible to estimate the cost of
remediation, the timing and extent of remedial action that may be required by
governmental authorities, and the amount of liability, if any, of the Company
alone or in relation to that of any other PRPs. Where it has been possible to
make a reasonable estimate of the Company's probable liability, a provision has
been established. Insurance proceeds have only been taken into account when they
have been confirmed by or received from the insurance company. Actual costs to
be incurred in future periods may vary from these estimates. Based on facts
presently known to it, the Company does not believe that the outcome of these
proceedings will have a material adverse effect on its financial position.
6
In addition to the above proceedings, the Company has worked with the
Connecticut Department of Environmental Protection ("CT DEP") related to certain
polychlorinated biphenyl ("PCB") contamination in the soil beneath a section of
cement flooring at its Woodstock, Connecticut facility. The Company completed
clean-up efforts in 2000, monitored the site in 2001, 2002 and 2003, and will
continue to monitor the site for the next two years. On the basis of estimates
prepared by environmental engineers and consultants, the Company recorded a
provision of $2.2 million prior to 1999 and based on updated estimates provided
an additional $400,000 in 1999 for costs related to this matter. Prior to 2003,
$2.5 million was charged against this provision. In 2003 expenses of $65,000
were charged against the provision. The remaining amount in the reserve is
primarily for testing, monitoring, sampling and minor residual treatment
activity. Management believes, based on facts currently available, that the
balance of this provision is adequate to complete the project.
In this same matter the United States Environmental Protection Agency ("EPA")
alleged that the Company improperly disposed of PCBs. An administrative law
judge found the Company liable for this alleged disposal and assessed a penalty
of approximately $300,000. The Company reflected this fine in expense in 1998
but disputed the EPA allegations and appealed the administrative law judge's
findings and penalty assessment. The original findings were upheld internally by
the EPA's Environmental Appeals Board, and the Company placed that decision on
appeal with the District of Columbia Federal Court of Appeals in 2000. In early
January of 2002, the Company was informed that the Court of Appeals reversed the
decision. As a result of this favorable decision, the $300,000 reserve for the
fine was taken into income in 2001. However, subsequent to the favorable
decision by the Court of Appeals, the EPA continued to pursue this issue and
settlement discussions with the EPA were more protracted and difficult than
originally anticipated. As such, the Company recorded $325,000 for legal and
other costs associated with this matter in 2002. On January 16, 2003, a
settlement agreement was signed with the EPA. The costs associated with the
settlement included a cash settlement payment to the government of $45,000,
which has been paid, a commitment to undertake two energy-related environmental
improvements at its facilities, one of which has been completed, and a financial
commitment for assistance to a local Woodstock, Connecticut Fire Department for
emergency preparedness, which has also been completed. As such, the provision
recorded is expected to be adequate to cover the requirements of the settlement.
Over the past several years, there has been a significant increase in certain
U.S. states in asbestos-related product liability claims against numerous
industrial companies. The Company has been named, along with hundreds of other
industrial companies, as a defendant in some of these cases. The Company
strongly believes it has valid defenses to these claims and intends to defend
itself vigorously. In addition, the Company believes that it has sufficient
insurance to cover all material costs associated with these claims. Based upon
past claims experience and available insurance coverage, management believes
that the resolution of these matters will not have a material adverse effect on
the financial position, results of operations, or cash flows of the Company.
In addition to the above issues, the nature and scope of the Company's business
bring it in regular contact with the general public and a variety of businesses
and government agencies. Such activities inherently subject the Company to the
possibility of litigation, including environmental and product liability matters
that are defended and handled in the ordinary course of business. The Company
has established accruals for matters for which management considers a loss to be
probable and reasonably estimable. It is the opinion of management that facts
known at the present time do not indicate that such litigation, after taking
into account insurance coverage and the aforementioned accruals, will have a
material adverse effect on the financial position of the Company.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
7
PART II
Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
ISSUER PURCHASES OF EQUITY SECURITIES
Pursuant to General Instruction G to Form 10-K, there is hereby incorporated by
this reference the information set forth under the caption "Capital Stock Market
Prices" on the inside back cover, under the caption "Restriction on Payment of
Dividends" in Note G on page 48, and under the caption "Dividend Policy" in the
"Management's Discussion and Analysis" on page 26 of the 2003 annual report to
shareholders.
At February 28, 2004 there were 901 shareholders of record.
Item 6. SELECTED FINANCIAL DATA
Pursuant to General Instruction G to Form 10-K, there is hereby incorporated by
this reference the information set forth under the caption "Selected Financial
Data" on page 17 of the 2003 annual report to shareholders.
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Pursuant to General Instruction G to Form 10-K, there is hereby incorporated by
this reference the information set forth under the caption "Management's
Discussion and Analysis" on pages 18 through 31 of the 2003 annual report to
shareholders.
Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Pursuant to General Instruction G to Form 10-K, there is hereby incorporated by
this reference the information set forth under the caption "Market Risk" in the
"Management's Discussion and Analysis" on pages 29-30 of the 2003 annual report
to shareholders.
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Pursuant to General Instruction G to Form 10-K, there is hereby incorporated by
this reference the information set forth on pages 32 through 58 and under the
caption "Quarterly Results of Operations" on the inside back cover of the 2003
annual report to shareholders.
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
Item 9a. CONTROLS AND PROCEDURES
a. The Company's Chief Executive Officer, Chief Operating Officer and Chief
Financial Officer have evaluated the effectiveness of the Company's
disclosure controls and procedures, as defined in Rules 13a-15(e) under the
Securities Exchange Act of 1934 (the "Exchange Act"), as of the end of the
period covered by this Annual Report (the "Evaluation Date"). Based on such
evaluation, such officers have concluded that, as of the Evaluation Date,
the Company's disclosure controls and procedures are effective in alerting
the Company's management on a timely basis to material information required
to be disclosed in the Company's reports filed under the Exchange Act.
b. There have been no significant changes in the Company's internal controls
or in other factors that could significantly affect such controls since the
Evaluation Date.
8
PART III
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Pursuant to General Instruction G to Form 10-K, there is hereby incorporated by
this reference the information with respect to the Directors of the Company set
forth under the caption "Nominees for Director" in the Company's definitive
proxy statement for its 2004 annual meeting of stockholders that is anticipated
to be filed on March 15, 2004 pursuant to Section 14(a) of the Exchange Act.
Information with respect to Executive Officers of the Company is presented in
Part I, Item 1 of this report and is set forth in the Company's definitive proxy
statement for its 2004 annual meeting of stockholders that is anticipated to be
filed on March 15, 2004 pursuant to Section 14(a) of the Exchange Act.
Code of Ethics
The Company has adopted a code of business conduct and ethics, which applies to
all employees, officers and directors of Rogers. The code of business conduct
and ethics is posted on the Company's website at http://rogerscorporation.com/.
The Company intends to satisfy the disclosure requirements regarding any
amendment to, or waiver of, a provision of the code of business conduct and
ethics for the Chief Executive Officer, principal financial officer and
principal accounting officer (or others performing similar functions) by posting
such information on its website.
Item 11. EXECUTIVE COMPENSATION
Pursuant to General Instruction G to Form 10-K, there is hereby incorporated by
this reference the information set forth under the captions "Directors'
Compensation" and "Executive Compensation" in the Company's definitive proxy
statement for its 2004 annual meeting of stockholders that is anticipated to be
filed on March 15, 2004 pursuant to Section 14(a) of the Exchange Act.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS
Pursuant to General Instruction G to Form 10-K, there is hereby incorporated by
this reference the information with respect to Security Ownership of Certain
Beneficial Owners and Management and Related Stockholder Matters set forth under
the captions "Stock Ownership of Management", "Beneficial Ownership of More Than
Five Percent of Rogers Stock", and "Equity Compensation Plan Information" in the
Company's definitive proxy statement for its 2004 annual meeting of stockholders
that is anticipated to be filed on March 15, 2004 pursuant to Section 14(a) of
the Exchange Act.
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Pursuant to General Instruction G to form 10-K, there is hereby incorporated by
reference the information with respect to certain relationships and related
transactions set forth in Note D under the caption "Summarized Financial
Information of Unconsolidated Joint Ventures and Related Party Transactions" on
pages 43-44 of the 2003 annual report to shareholders.
Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Pursuant to General Instruction G to Form 10-K, there is hereby incorporated by
this reference the information with respect to Accountant Fees set forth under
the caption "Fees of Independent Auditors" in the Company's definitive proxy
statement for its 2004 annual meeting of stockholders that is anticipated to be
filed on March 15, 2004 pursuant to Section 14(a) of the Exchange Act.
9
PART IV
Item 15. EXHIBITS, FINANCIAL STATEMENTS AND SCHEDULES, AND REPORTS ON FORM 8-K
(a)(1) and (2)- The following consolidated financial statements of Rogers
Corporation and Subsidiaries, included in the Annual Report
of the Registrant to its shareholders for the fiscal year
ended December 28, 2003 are incorporated by reference in
Item 8:
Consolidated Balance Sheets - December 28, 2003 and
December 29, 2002
Consolidated Statements of Income - Fiscal Years Ended
December 28, 2003, December 29, 2002, and December 30, 2001
Consolidated Statements of Shareholders' Equity - Fiscal
Years Ended December 28, 2003, December 29, 2002, and
December 30, 2001
Consolidated Statements of Cash Flows - Fiscal Years Ended
December 28, 2003, December 29, 2002, and December 30, 2001
Notes to Consolidated Financial Statements - December 28,
2003
The following consolidated financial statement schedule of Rogers
Corporation and Subsidiaries is included in Item 15 (d):
Schedule II Valuation and Qualifying Accounts
All other schedules for which provision is made in the applicable
accounting regulations of the Securities and Exchange Commission
are not required under the related instructions or are
inapplicable, and therefore have been omitted.
(3) Exhibits required to be filed by Item 601 of Regulation S-K, and by Item
15-c below:
2 Stock Purchase Agreement, dated September 30, 2003, among 3M Company, 3M
Innovative Properties Company, Durel Corporation and Rogers Corporation for
the purchase of Durel Corporation was filed as Exhibit 2.1 to the
Registrant's Form 8-K filed on October 15, 2003*.
3a Restated Articles of Organization, filed with the Secretary of State of
the Commonwealth of Massachusetts on April 6, 1966, were filed as Exhibit
3a to the Registrant's Annual Report on Form 10-K for the fiscal year ended
January 1, 1989 (the 1988 Form 10-K)*.
3b Articles of Amendment to the Articles of Organization, filed with
the Secretary of State of the Commonwealth of Massachusetts on August 10,
1966, were filed as Exhibit 3b to the 1988 Form 10-K*.
3c Articles of Merger of Parent and Subsidiary Corporations, filed with
the Secretary of State of the Commonwealth of Massachusetts on December 29,
1975, were filed as Exhibit 3c to the 1988 Form 10-K*.
3d Articles of Amendment, filed with the Secretary of State of the
Commonwealth of Massachusetts on March 29, 1979, were filed as Exhibit 3d
to the 1988 Form 10-K*.
3e Articles of Amendment, filed with the Secretary of State of the
Commonwealth of Massachusetts on March 29, 1979, were filed as Exhibit 3e
to the 1988 Form 10-K*.
3f Articles of Amendment, filed with the Secretary of State of the
Commonwealth of Massachusetts on April 2, 1982, were filed as Exhibit 3f to
the 1988 Form 10-K*.
3g Articles of Merger of Parent and Subsidiary Corporations, filed with
the Secretary of State of the Commonwealth of Massachusetts on December 31,
1984, were filed as Exhibit 3g to the 1988 Form 10-K*.
3h Articles of Amendment, filed with the Secretary of State of the
Commonwealth of Massachusetts on April 6, 1988, were filed as Exhibit 3h to
the 1988 Form 10-K*.
3i By-Laws of the Company as amended on March 28, 1991, September 10, 1991,
June 22, 1995, April 25, 2002 and June 19, 2002. The March 28, 1991,
September 10, 1991 and June 22, 1995, amendments were filed as Exhibit 3i
to the Registrant's Annual Report on Form 10-K for the fiscal year ended
December 31, 1995 (the 1995 Form 10-K)*. The April 25, and June 19, 2002
amendments were filed as Exhibit 3i to the Registrant's Annual Report on
Form 10-K for the fiscal year ended December 29, 2002*.
10
3j Articles of Amendment, as filed with the Secretary of State of the
Commonwealth of Massachusetts on May 24, 1994, were filed as Exhibit 3j to
the 1995 Form 10-K*.
3k Articles of Amendment, as filed with the Secretary of State of the
Commonwealth of Massachusetts on May 8, 1998 were filed as Exhibit 3k to
the 1998 Form 10-K*.
4a 1997 Shareholder Rights Plan was filed on Form 8-A dated March 24, 1997.
The June 19, 1997 and July 7, 1997 amendments were filed on Form 8-A/A
dated July 21, 1997*.
4b Certain Long-Term Debt Instruments, each representing indebtedness in an
amount equal to less than 10 percent of the Registrant's total consolidated
assets, have not been filed as exhibits to this Annual Report on Form 10-K.
The Registrant hereby undertakes to file these instruments with the
Commission upon request.
10b Description of the Company's Life Insurance Program**, was filed as
Exhibit K to the Registrant's Annual Report on Form 10-K for the fiscal
year ended December 28, 1980*.
10c Rogers Corporation 2004 Annual Incentive Compensation Plan** (2004) is
filed herewith.
10d Rogers Corporation 1988 Stock Option Plan** (as amended December 17, 1988,
September 14, 1989, October 23, 1996, April 18, 2000, June 21, 2001, August
22, 2002, and December 5, 2002). The 1988 plan, the 1988 amendment, and the
1989 amendment were filed as Exhibit 10d to the Registrant's Annual Report
on Form 10-K for the fiscal year ended January 1, 1995 (the 1994 Form
10-K)*. The 1996 amendment was filed as Exhibit 10d to the 1996 Form 10-K*.
The April 18, 2000 amendment, June 21, 2001 amendment, August 22, 2002
amendment and December 5, 2002 amendment are filed herewith.
10e Rogers Corporation 1990 Stock Option Plan** (as restated and amended on
October 18, 1996, December 21, 1999, amended on April 18, 2000, June 21,
2001, August 22, 2002, October 7, 2002, and December 5, 2002). The October
18, 1996 restatement and amendment was filed as Registration Statement No.
333-14419 on Form S-8 dated October 18, 1996*. The December 21, 1999
amendment was filed as Exhibit 10e to the 1999 Form 10-K*. The October 7,
2002 amendment was filed as Exhibit 10e to the Registrant's Annual Report
on Form 10-K for the fiscal year ended December 29, 2002*. The April 18,
2000 amendment, June 21, 2001 amendment, August 22, 2002 amendment and
December 5, 2002 amendment are filed herewith.
10f Rogers Corporation Deferred Compensation Plan** (1983) was filed as
Exhibit O to the Registrant's Annual Report on Form 10-K for the fiscal
year ended January 1, 1984*.
10g Rogers Corporation Deferred Compensation Plan** (1986) was filed as Exhibit
10e to the 1987 Form 10-K*.
10h Rogers Corporation 1994 Stock Compensation Plan** (as restated and
amended on October 17, 1996, amended on December 18, 1997, April 18, 2000,
June 21, 2001, August 22, 2002, and December 5, 2002). The 1994 plan, as
amended and restated on October 17, 1996, was filed as Exhibit 10h to the
1996 Form 10-K*. The 1997 amendment was filed as Exhibit 10h to the 1997
Form 10-K*. The April 18, 2000 amendment, June 21, 2001 amendment, August
22, 2002 amendment, and December 5, 2002 amendment are filed herewith.
10i Rogers Corporation Voluntary Deferred Compensation Plan for Non-Employee
Directors** (1994, as amended December 26, 1995, December 27, 1996 and as
restated and amended December 21, 1999, October 7, 2002, and December 5,
2002). The 1994 plan, the December 26, 1995 and December 27, 1996
amendments were filed as Exhibit 10i to the 1994 Form 10-K, 1995 Form 10-K,
and 1996 Form 10-K, respectively*. The December 21, 1999 restatement and
amendment were filed as Exhibit 10i to the 1999 Form 10-K*. The October 7,
2002 amendment was filed as Exhibit 10i to the Registrant's Annual Report
on Form 10-K for the fiscal year ended December 29, 2002 *. The December 5,
2002 amendment is filed herewith.
10j Rogers Corporation Voluntary Deferred Compensation Plan for Key Employees**
(1993, as amended on December 22, 1994, December 21, 1995, December 22,
1995, April 17, 1996 and as restated and amended on December 21, 1999,
October 7, 2002, and December 5, 2002). The 1993 plan and the 1994
amendments were filed as Exhibit 10j to the 1994 Form 10- K*. The 1995 and
1996 amendments were filed as Exhibit 10j to the 1995 Form 10-K and 1996
Form 10-K, respectively*. The December 21, 1999 restatement and amendment
were filed as Exhibit 10j to the 1999 Form 10-K*. The October 7, 2002
amendment was filed as Exhibit 10j to the Registrant's Annual Report on
Form 10-K for the fiscal year ended December 29, 2002 *. The December 5,
2002 amendment is filed herewith.
10k Rogers Corporation Long-Term Enhancement Plan for Senior Executives of
Rogers Corporation** (December 18, 1997*, as amended April 4, 2000, October
7, 2002, and December 5, 2002). The April 4, 2000 amendment was file as
Exhibit 10k to the 2000 Form 10-K*. The October 7, 2002 amendment was filed
as Exhibit 10k to the Registrant's Annual Report on Form 10-K for the
fiscal year ended December 29, 2002*. The December 5, 2002 amendment is
filed herewith.
10l Rogers Corporation 1998 Stock Incentive Plan**(1998, as amended September
9, 1999, December 21, 1999, April 18, 2000, June 21, 2001, October 10,
2001, August 22, 2002, November 7, 2002, December 5, 2002 and February 19,
2004). The 1998 Plan was filed as Registration Statement No. 333-50901 on
April 24, 1998*. The September 9, 1999 and December 21, 1999 amendments
were filed as Exhibit 10l to the 1999 Form 10-K*. The October 10, 2001 and
November 7, 2002 amendments were filed as Exhibit 10l to the Registrant's
Annual Report on Form 10-K for the fiscal year ended December 29, 2002 *.
The April 18, 2000 amendment, June 21, 2001 amendment, August 22, 2002
amendment, December 5, 2002 amendment and February 19, 2004 amendment is
filed herewith.
11
10m Multicurrency Revolving Credit Agreement dated December 8, 2000 was filed
as Exhibit 10m to the 2000 Form 10-K*.
10n Rogers Corporation Executive Supplemental Agreement** for the Chairman
of the Board and Chief Executive Officer, dated December 5, 2002, was filed
as Exhibit 10n to the Registrant's Annual Report on Form 10-K for the
fiscal year ended December 29, 2002 *.
10o Rogers Corporation Pension and Restoration Plan** (as amended and
restated March 10, 2004). The March 10, 2004 amendment is filed herewith.
13 Portions of the Rogers Corporation 2003 Annual Report to Shareholders
which are specifically incorporated by reference in this Annual Report on
Form 10-K.
21 Subsidiaries of the Registrant.
23a Consent of Independent Auditors.
23b Consent of Independent Auditors.
31a Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer.
31b Rule 13a-14(a)/15d-14(a) Certification of Chief Operating Officer.
31c Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Office.
32a Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section
1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32b Certification of Chief Operating Officer Pursuant to 18 U.S.C. Section
1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32c Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section
1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
33a 2002 Financial Statements for the Company's former joint venture with 3M,
Durel Corporation, were filed as the Exhibit 99.3 to Registrant's Annual
Report on Form 10-K for the fiscal year-ended December 29, 2002*.
33b Unaudited Financial Statements for the nine-month period ended September
30, 2003 for the Company's former joint venture with 3M, Durel
Corporation.
* In accordance with Rule 12b-23 and Rule 12b-32 under the Securities
Exchange Act of 1934, as amended, reference is made to the documents
previously filed with the Securities and Exchange Commission, which
documents are hereby incorporated by reference.
** Management Contract.
(b) Reports on Form 8-K filed for the three months ended December 28, 2003:
An amended Form 8-K was filed on December 12, 2003 with respect to the
Company's acquisition of Durel Corporation.
An amended Form 8-K was filed on November 21, 2003 with respect to the
Company's Third Quarter Earnings Release.
A Form 8-K was filed on October 15, 2003 with respect to the Company's
Third Quarter Earnings Release.
A Form 8-K was filed on October 15, 2003 with respect to the Company's
acquisition of Durel Corporation.
(c) Exhibits - The response to this portion of Item 15 is submitted within Item
15(a)(3) of this report.
(d) Financial Statement Schedule
12
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
ROGERS CORPORATION AND CONSOLIDATED SUBSIDIARIES
Charged to Charges
Balance at (Reduction of) Taken Other Balance at
Beginning of Costs and Expenses Against (Deductions) End of
(Dollars in thousands) Period Allowance Recoveries Period
---------------- --------------------- ------------- ---------------- -------------
Allowance for Doubtful Accounts:
December 28, 2003 $1,102 $349 $(41) $(36) $1,446
December 29, 2002 1,363 (200) (154) 93 1,102
December 30, 2001 1,804 (390) (80) 29 1,363
13
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.
ROGERS CORPORATION
(Registrant)
Date: March 12, 2003 By /s/James M. Rutledge
--------------------
James M. Rutledge
Vice President, Finance and
Chief Financial Officer
(Principal Financial and Accounting Officer)
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below on March 12, 2003, by the following persons on behalf of
the Registrant and in the capacities indicated.
By /s/ Walter E. Boomer Chairman of the Board of Directors and
-------------------- Chief Executive Officer
Walter E. Boomer
By /s/ Robert D. Wachob President and Chief Operating Officer
--------------------
Robert D. Wachob
By /s/ James M. Rutledge Vice President, Finance and Chief
--------------------- Financial Officer
James M. Rutledge (Principal Financial and Accounting Officer)
By /s/ Leonard M. Baker Director
--------------------
Leonard M. Baker
By /s/ Harry H. Birkenruth Director
-----------------------
Harry H. Birkenruth
By /s/ Edward L. Diefenthal Director
------------------------
Edward L. Diefenthal
By /s/ Gregory B. Howey Director
---------------------
Gregory B. Howey
By /s/ Leonard R. Jaskol Director
---------------------
Leonard R. Jaskol
By /s/ Eileen S. Kraus Director
--------------------
Eileen S. Kraus
By /s/ William E. Mitchell Director
-----------------------
William E. Mitchell
By /s/ Robert G. Paul Director
--------------------
Robert G. Paul
14