ITEM 1. BUSINESS
GENERAL
Melamine Chemicals, Inc. (the "Company") is engaged in the production and marketing of melamine crystal, a specialty chemical having numerous industrial and commercial applications. Principal products in which melamine is used include coatings such as paints for automobiles and major household appliances; laminates such as kitchen countertops, wood paneling and furniture; virtually unbreakable dinnerware; adhesives for composite wood products such as particleboard; and as a flame retardant additive in certain polyurethane foams, paints and polymeric compounds. The Company, one of only two producers of melamine in North America, is one of the three largest producers in the world and estimates that it has 60% of the domestic merchant market. The Company is engaged in the development of new melamine process and applications technology and the development and commercialization of melamine-related compounds.
The Company was formed in 1968 as a Delaware corporation by Ashland Inc. ("Ashland") and First Mississippi Corporation ("First Mississippi"), each of which owned 50% of the Company's outstanding capital stock prior to the Company's initial public offering in August 1987. Ashland and First Mississippi each owns 23.4% of the Company. The Company's plant in Donaldsonville, Louisiana (the "M-I plant"), which has a design and operating capacity of 75 million pounds per year, was completed in 1971 and has been producing melamine with approximately 99.9% purity levels since that date.
In June 1987, the Company started construction of a new production facility at the Donaldsonville plant that utilizes a high-pressure, high-temperature non-catalytic process developed and patented by the Company (the "M-II process") with a design and operating capacity of 30 million pounds per year (the "M-II plant"). Management believed that the M-II process would result in significant improvements over the low-pressure, catalytic process (the "M-I process") used by the M-I plant, including savings in capital costs and energy costs over comparable production facilities utilizing the M-I technology. During fiscal 1994, the M-II plant produced 16.3 million pounds, during fiscal 1995, the plant produced 23.8 million pounds and during fiscal 1996, the plant produced 24.6 million pounds. The M-II plant's production in fiscal 1994 was negatively impacted by a decision to take an extended maintenance turnaround to reduce inventory levels.
The purity of the product produced by the M-II plant is averaging in excess of 97%, and 100% of the product's ingredients are chemically active. The Company has been successful in introducing this product into a variety of markets including adhesive resins, molding compounds and concrete additives. While not all market segments are expected to be able to use the M-II product, the Company believes that approximately 80% of the current worldwide melamine market could utilize this product. During fiscal 1996, sales of the M-II product totaled 21.8 million pounds compared to 21.8 million pounds in fiscal 1995 and 24.7 million pounds in fiscal 1994.
In June 1995, the Company filed patent applications in the United States covering what it believes to be significant improvements to the M-II process. Laboratory test of these improvements indicates that they can increase the melamine content of our M-II product up to 99.5% plus. With this improvement in melamine content, the M-II product should be suitable for 90% of the current worldwide consumption. The patents were issued in May 1996.
END-USES OF MELAMINE
Three principal characteristics make melamine crystal chemically unique: (i) stability that makes it resistant to chemical, thermal and physical degradation; (ii) a structure that allows it to be combined with other chemical compounds, particularly formaldehyde and other monomers, in a wide variety of chemical
reactions and polymerizations; and (iii) a 66% nitrogen content. Melamine has excellent fire retardant properties because: (i) when exposed to intense heat, it gives off nitrogen-containing compounds that dilute oxygen, thereby inhibiting combustion; and (ii) it is endothermic and, therefore, acts as a heat-sink which also inhibits combustion.
Over 80% of the melamine sold by the Company is used in the manufacture of melamine-formaldehyde resins. These resins have numerous end-uses including: (i) surface coatings, which account for more than one-third of domestic melamine consumption; (ii) laminates, which account for more than one-quarter; and (iii) plastic molding compounds, which account for approximately one-sixth of domestic consumption. Melamine-based resins are also used in paper treatments and coatings, textile treatments and coatings, wood adhesives and other uses. These markets, together with other end-uses of melamine, are described below:
Surface coating resins. Melamine resins are used as clear finishes for paper, fabrics, wood and metals and can be pigmented with white and colored pigments to produce opaque enamel finishes. The finishes are color retentive and water and chemical resistant, and can be used for both interior and exterior applications. Finishes are formulated for refrigerators, washing machines, automobiles, hospital equipment, kitchen utensils and cans. In combination with other materials, melamine resins can be used as flexible finishes for paper textiles and fabrics. Surface and automotive coatings represent the largest single domestic use of melamine. The Company believes that over 95% of all automobiles produced in the United States are now being painted with high solids melamine-based paints that emit less fumes during application and produce higher quality finishes than traditional coatings.
Laminating resins. Melamine resins are used in laminated products. Decorative melamine laminates are often used when durability, especially heat and stain resistance, is desired. Typical applications include countertops, cabinet surfaces, simulated wood paneling, furniture surfaces and shelving. Kitchen and bathroom countertops are a principal household use of melamine.
Plastic molding compounds. Melamine resins with strong thermosetting attributes are molded into a variety of translucent, heat-resistant products that are odorless and tasteless, with pale color. Fillers, pigments and dyes can be incorporated into the plastic to produce various combinations of opacity and color. These plastics are used in tableware, wash-resistant buttons, arc-resistant ignition housings, insulation and many other products. The primary advantages of these plastics are their strong resistance to water, heat, chemicals and discoloration and their relative non-conductivity and virtual unbreakability.
Paper-treating resins. Melamine resins are widely used to impart wet-strength, dimensional stability and other favorable properties to paper.
Adhesive-binding resins. Melamine resins produce excellent weather-resistant adhesive bonds and are used in particleboard and as binders for glass fibers in air filters, brake linings and foundry sand cores.
Flame retardant products. Melamine is used as a fire retardant in specialized paints, certain thermoplastics, textile products and in flexible polyurethane foam used in the furniture and bedding industry. Because of heightened public awareness of fire hazards created by the use of combustible materials in fabrics and furniture, the Company believes the opportunity for sales growth in this area is promising.
Other uses. Melamine is also used in varied applications such as flocculating agents in water treatment, in fluorescent pigments, as concrete additives and as polymeric stabilizers.
MARKETING AND SALES
The Company's domestic and international sales are managed by a Vice President of Sales and Marketing. The Company uses a number of agents outside the United States.
During the last three years, approximately 50% of the Company's output was purchased by less than ten industrial customers, including Monsanto Chemical Company, Sun Coast Industries, Inc., BASF Corporation and BTL Specialty Resins Corporation. More than 10% of the Company's output was purchased by Monsanto Chemical Company during this period, and in fiscal 1994 and 1995, Sun Coast Industries, Inc. also purchased more than 10% of the Company's output.
During fiscal 1994, approximately 49% of the net sales of the Company were derived from customers in foreign countries. Approximately 8% were to customers in Italy, 7% to customers in Japan, 5% to customers in Turkey, 4% to customers in Indonesia, 3% to customers in the Netherlands, 3% to customers in Belgium, 3% to customers in Australia, 3% to customers in Thailand and 13% to customers in other countries. During fiscal year 1995, approximately 38% of the net sales of the Company were derived from customers in foreign countries. Approximately 8% were to customers in Italy, 4% to customers in Belgium, 4% to customers in Brazil, 4% to customers in the Netherlands, 2% to customers in Chile, 2% to customers in France, 2% to customers in Germany, 2% to customers in Turkey and 10% to customers in other countries. During fiscal 1996, approximately 43% of the net sales of the Company were derived from customers in foreign countries. Approximately 6% were to customers in Italy, 5% to customers in the Netherlands, 5% to customers in Belgium, 5% to customers in Australia, 4% to customers in Indonesia, 2% to customers in India, 2% to customers in Israel, 2% to customers in Korea, 2% to customers in Taiwan and 10% to customers in other countries.
For additional information on sales to significant customers and export sales, see footnote 6 to the financial statements on Page 23.
COMPETITION
The Company and American Melamine Industries (AMEL) are the only two domestic producers of melamine crystal. AMEL's facility, located in Fortier, Louisiana, has production capacity of approximately 140 million pounds per year. AMEL is a manufacturing joint venture between Cytec Industries Inc.'s ("Cytec") and N.V. Nederlandse Staatsmijnen (DSM), the world's largest melamine producer.
The Company estimates its share of the domestic merchant market to be approximately 60%. The addition in 1990 of approximately 65 million pounds of production capacity at the AMEL plant and increased competition from foreign producers have made competition in the domestic market intense. In the last four fiscal years, the Company has placed greater emphasis on selling in the domestic market.
Melamine is also produced through several different process technologies at approximately 20 plants in 15 other countries. Industry reports indicate that worldwide nameplate capacity is approximately 1.4 billion pounds per year, although the Company believes that effective capacity is approximately 1.2 billion pounds. The Company cannot reliably analyze worldwide competitive conditions because production and consumption data are not available in all countries outside of the United States.
Melamine imports during the twelve months ended June 30, 1996 have constituted less than 10% of the total merchant market.
The Company attempts to differentiate itself from competitors to the greatest extent possible on the basis of custom packaging, a variety of particle sizes, offering M-II type melamine crystal (under the trademark G. P. Crystal(TM)), superior and flexible customer service and new technology. Also emphasized is the fact that all production is sold to customers, there being no internal consumption. Those factors, combined with pricing consistent with levels established in the various geographic markets, have led to the Company's share of the domestic merchant market (the total domestic market less the portion attributable to Cytec's internal consumption) and to its role in supplying export customers.
The Company generally has been protected from competition from substitute materials because of melamine's unique physical characteristics, including its clarity, heat and chemical resistance, colorability and surface hardness.
MARKET DEVELOPMENT AND RESEARCH
In its research and market development programs, the Company uses its own employees and outside consultants to improve melamine process technology, provide marketing support and applications development and develop new proprietary products and applications for melamine.
PATENTS
The Company possesses technical know-how and trade secrets, as well as 20 United States patents, that cover both the M-II process and various industrial and agricultural applications. None of the Company's patents will expire before the year 2001. The Company also holds or has applied for the equivalent of many of its United States patents in various foreign countries.
MELAMINE PRODUCTION
General. Because of their complexity, the corrosive nature of their chemical reaction processes, and their integration with urea production, melamine plants throughout the world historically have proven difficult to operate on a continuous basis. The Company's M-I plant experienced operating difficulties from the time of its construction in 1971 through 1985. Refinement of critical plant processes and careful maintenance have enabled the Company to produce nearer to full capacity since January 1986. The Company believes the difficulties associated with operating a melamine plant represent a significant competitive barrier to entry into the industry.
The Melamine-I Process. Currently, the Company produces approximately 75% of its melamine through a continuous chemical process that heats urea, which is made from ammonia and carbon dioxide, under low pressure in the presence of a catalyst. In the Company's M-I process, hot urea melt (liquid urea) is pumped from Triad Chemical's ("Triad") adjacent urea plant into a reactor where it is atomized with heated ammonia and converted into gaseous melamine with gaseous ammonia and carbon dioxide formed as by-products. The gaseous melamine flows from the reactor to a saturator cooler where it is converted to a slurry through a cooling process. The ammonia and carbon dioxide by-products are diverted into an ammonia recovery system where pure ammonia is recovered for reuse in the reactor. The remaining ammonia and all of the carbon dioxide are then combined with water into a concentrated liquid solution known as carbamate, returned by pipeline to the urea plant and recycled to produce additional urea. The melamine slurry is pumped into a filtration and recrystallization system designed to produce melamine crystal that is approximately 99.9% pure.
The Melamine-II Process. The M-II process is a continuous, high-pressure, non-catalytic anhydrous process in which hot urea melt is fed into a reactor under high-pressure and converted directly into melamine in liquid form with ammonia and carbon dioxide formed as gaseous by-products. After separation from the ammonia and carbon dioxide, the liquid melamine is injected into a cooling unit where it is depressurized and rapidly cooled. This process allows the formation of melamine crystal that has purity averaging in excess of 97%. The Company has found that the melamine produced with the M-II process is sufficiently pure for use in adhesive resins, as a flame retardant in flexible polyurethane foam, as a concrete additive and in certain molding compounds. While not all markets are expected to be able to use the product currently produced with the M-II process, the Company believes that approximately 70% of the current worldwide consumption could utilize this product.
SOURCES OF RAW MATERIALS
Under a feedstock supply agreement between the Company, First Mississippi and Mississippi Chemical Corporation ("Mississippi Chemical"), the Company obtains all of its urea and anhydrous ammonia from Triad, a joint venture between First Mississippi and Mississippi Chemical. Urea is fed directly from Triad's adjacent facility into the Company's reactor. The maximum amount of feedstock available under the agreement is sufficient for the production of approximately 95 million pounds per year. The feedstock agreement is scheduled to expire in June 2000. The Company pays First Mississippi and Mississippi Chemical for feedstock an amount related to, but less than, the weighted average sales price that First Mississippi charges bulk purchasers of solid urea. The Company receives, as a credit against the price, an amount based on carbamate returned to Triad. First Mississippi has agreed to supply urea and anhydrous ammonia to the Company to the extent that Mississippi Chemical wrongfully ceases to make deliveries. See Item 13. "Certain Relationships and Related Transactions."
The Company currently purchases less than 25% of Triad's urea output. Because of the advantages of receiving feedstock from and returning carbamate to an adjacent urea plant, the continued operation of Triad's plant is important to the Company. First Mississippi and Mississippi Chemical have not agreed to guarantee the continuation of Triad's operations and have reserved the right to suspend or terminate delivery of feedstock upon any suspension or termination of those operations. Except for temporary shutdowns for maintenance and repairs, Triad's facility has been in continuous operation for 25 years and is believed by the Company to be one of the most cost efficient urea plants in the United States. During such temporary shutdowns, the Company has been required to suspend melamine production. To the extent practicable, the Company stockpiles melamine in anticipation of Triad's regularly scheduled maintenance shut downs. The Company does not believe that its ability to fill customer orders in a timely manner has been significantly affected by any suspension of operations at the Triad facility.
ENERGY REQUIREMENTS
The Company uses natural gas as an energy source to operate its production facilities. The Company's production facilities are connected to three pipeline systems, enabling it to purchase natural gas from different suppliers. Under a three-year contract executed in August 1986 and extended every six months thereafter under the terms of the contract, the Company is purchasing all of its natural gas requirements from one supplier.
ENVIRONMENTAL AND OTHER REGULATORY CONSIDERATIONS
The Company is subject to regulation under federal, state and local environmental laws and regulations. During the last three years, the Company's operations did not result in the production of any significant effluents or emissions. Catalyst residues occur in such small quantities that no further processing is necessary for either environmental or safety reasons. Substantially all of the ammonia and carbon dioxide off-gases from the M-I plant are returned to Triad as carbamate and are used for the production of additional urea. Ammonia from the M-II plant is recycled to the M-I plant while carbon dioxide is vented to the atmosphere. The Company disposes off-site of a small quantity of material used in its filtration system. Except for ammonia, none of the Company's products or by-products are considered to be toxic within the meaning of current environmental laws. It is the Company's policy to operate its facility in compliance with all applicable environmental laws, and the Company does not believe that it is subject to any material liability under any such laws.
On August 24, 1990, the Louisiana Department of Environmental Quality ("DEQ") issued an order requiring the Company to submit within 60 days a comprehensive plan for reducing nitrogen oxides and reactive hydrocarbon emissions. Similar orders were sent to other facilities in the Baton Rouge area. Subsequently, the Company voluntarily agreed to participate in a Baton Rouge area industrial task force formed for the purpose of developing plans for the control and reduction of ozone pollution. The task force, in cooperation with the DEQ, has performed ozone modeling studies to determine whether nitrogen
oxides controls are necessary to reduce ozone levels in the Baton Rouge area. The task force has submitted its recommended plan to the DEQ but has not yet received approval. The Company's participation in the task force has temporarily stayed the DEQ order. The Company does not believe that the plan's implementation will significantly impact the operations of the Company nor require significant capital expenditures.
See Item 3. "Legal Proceedings" for a description of the potential liability associated with the cleaning up of Superfund site near the town of Sorrento, Louisiana.
Employee safety in the United States is regulated under the Occupational Safety and Health Act, and management believes that the Company is in compliance in all material respects with its requirements.
EMPLOYEES
The Company employs 93 persons at the Donaldsonville facility. In addition, the Company regularly has approximately 60 independent contractors working at its facility. None of the Company's regular full-time employees or its independent contractors are represented by unions.
BUSINESS INSURANCE
In addition to other customary insurance coverage, the Company maintains insurance against property damage and business interruption loss caused by fire, explosion or similar catastrophic events that result in physical damage or destruction to (i) the Company's premises or plants, (ii) the utility transmission lines or equipment that service its property and (iii) the facilities of Triad.
ITEM 2.

ITEM 2. PROPERTIES
The Company's plant is located on an eight-acre site that is leased from Triad near Donaldsonville, Louisiana. The plant site lease will expire June 1, 2000, and the lessee has the right to extend the lease for four additional five- year terms or until 2020. The annual rent under the lease is $2,500 during the primary term and any additional terms. Because the plant site is surrounded by land owned by Triad and would otherwise have no access to public thoroughfares, railroad lines or feedstock or utility sources, Triad has granted in the site lease certain non-exclusive rights-of-way over its property for all purposes necessary to permit operation of the plant.
The M-I plant was constructed by First Mississippi and Ashland in 1971 and leased to the Company. In June 1987, the Company purchased the M-I plant from subsidiaries of Ashland and First Mississippi.
During fiscal 1989, construction of the M-II plant was completed and start-up of the plant began. The start-up of the M-II plant was completed in April 1991.
The Company leases approximately 5,500 square feet of office space at the plant site from Triad. Lease of the office space is included in the plant site lease.
The Company owns a 17,600 square foot warehouse building and four silos on the plant site with combined capacity to store up to 5.5 million pounds of melamine. The Company uses common carriers to transport all of the melamine it produces. The Company has truck loading facilities at its warehouse and an adjacent rail spur that permits direct loading onto railroad cars.
ITEM 3.

ITEM 3. LEGAL PROCEEDINGS
The Company is one of seventeen defendants in a Superfund site clean up cost contribution action brought by four plaintiff companies. Fifteen of the defendants have settled or been dismissed from this litigation. The plaintiff companies have been identified by the United States Environmental Protection Agency (the "EPA") as the major generators of wastes disposed at the Cleve Reber Superfund site near the town of Sorrento, Louisiana. In September 1988, the plaintiff companies were ordered by the EPA to clean up the site, and they have agreed to do so. The plaintiff companies subsequently brought this suit seeking to recover approximately $51 million plus $6 million for reimbursement to the EPA for remedial costs. While the lawsuit is still in the discovery stage, it appears that the Company has substantial defenses to the action by plaintiffs. Material generated by the Company is alleged to have been disposed of at this site for only one brief period when the regular disposal site used by its waste disposal contractor was unavailable. The Company contends that any of its materials transported to the site were not hazardous waste and represent only a de minimis contribution to the site as compared to material disposed of there by the plaintiffs and other defendants. The Company has moved for summary judgment seeking dismissal from this lawsuit. The motion is presently pending before the court, but placed in abeyance pending settlement discussions.
In March 1995, the Company received notice that it had been named a potentially responsible party (PRP) at a Superfund site located near Iota, Louisiana. The EPA was attempting to recover approximately $4.7 million from approximately 350 PRP's, including the Company. During fiscal 1996, the Company was able to settle this matter for less than $1,000.
ITEM 4.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Company did not submit any matters to a vote of security holders during the fourth quarter of fiscal year ended June 30, 1996.
ITEM 4(a). EXECUTIVE OFFICERS OF THE REGISTRANT
Set forth below is certain information regarding the executive officers of the Company as of September 6, 1996.
James W. Crook, 66, has served as Chairman of the Board since June 1987. Mr. Crook, a private investor, has served on the Board of Directors since 1972. Mr. Crook is a director of First Mississippi Corporation and is also a member of the Triad Management Committee.
Frederic R. Huber, 61, has served as President and Chief Executive Officer since November 1991. From 1985 to November 1991, Mr. Huber served as Executive Vice President of the Organic Chemicals Division of W. R. Grace & Co.
Wayne D. DeLeo, 49, has served as Vice President and Chief Financial Officer since 1987.
Martin F. Lapari, 48, has served as Vice President of Manufacturing and Engineering since August 1992. From May 1987 until August 1992, Mr. Lapari served as the Company's plant manager.
William A. Sorensen, 60, has served as Vice President of Sales and Marketing since January 1994. From January 1993 to December 1993, Mr. Sorensen served as Director of National Account Sales of LaRoche Chemicals, Inc. From 1989 to 1992, Mr. Sorensen served as Director of Corporate Relations of LaRoche Chemicals Inc., a manufacturer of specialty and industrial aluminas, chlor alkali and conditioned comfort products.
PART II
ITEM 5.

ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS
The Company's common stock trades on The Nasdaq Stock Market under the symbol MTWO.
The following table sets forth the high and low sales price of the Company's common stock as quoted on Nasdaq for the fiscal years ending June 30, 1996 and 1995:
As of September 6, 1996, there were 212 record holders of the Company's common stock and approximately 1,843 beneficial shareholders.
In May 1992, the Board of Directors eliminated the payment of dividends for the foreseeable future because of the lack of earnings and the need to conserve cash. The declaration and payment of dividends are at the discretion of the Board of Directors of the Company. The payment of future dividends will be considered by the Board of Directors from time to time based on the Company's results of operations, financial position, capital requirements and other factors.
ITEM 6.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Sales in fiscal 1996 increased to $55.6 million from $45.5 million in fiscal 1995. The sales volume increased by 2% while the sales prices increased by 20%. The sales volume for fiscal 1996 was curtailed by the Company to build inventory to a more acceptable level. The sales price increases during fiscal 1996 reflect the impact of strong worldwide demand.
Sales in fiscal 1995 increased to $45.5 million from $39.1 million in fiscal 1994. The sales volume decreased to 100 million pounds from 105 million pounds because of low inventory levels. While sales volume decreased, the average sales price increased 22% in fiscal 1995 as compared to fiscal 1994. The sales price increase was due to the strengthening worldwide economies and the resulting increase in demand. During fiscal 1995, the Company implemented two overall price increases and announced another price increase effective July 1, 1995.
The following table, which is derived from Item 6. "Selected Financial Data," sets forth for the periods indicated certain items from the Company's statements of operations as a percentage of the Company's sales:
The gross profit margins in fiscal 1996 decreased slightly as compared to fiscal 1995. Net sales price for the fiscal year increased by 8.9_ per pound while the Company experienced an increase in the cost of production of 7.8_ per pound. The increase in the cost of production was due to:
o a 52% increase in the price of raw material increased the cost of production by 7.5_ per pound; and
o an increase in the price of natural gas increased the cost of production by .9_ per pound.
Offsetting these increases was the benefit that increased production volume had on spreading fixed cost.
The gross profit margins improved in fiscal 1995 as compared to fiscal 1994 because of an increase in average sales price of 8.1_ per pound and a reduction in cost of production of 2.0_ per pound. The reduction in the cost of production was due to:
o increased production volume over which fixed costs, including depreciation, could be spread; and
o a decrease in the price of natural gas, which amounted to $875,000.
The reduction in the cost of production was achieved in spite of a $1.8 million increase in maintenance cost due to the deterioration of the salt coils in the M-I plant. The salt coils have a limited life and failures increase with age and were replaced in fiscal 1996.
Selling, general and administrative expenses increased by 10% in fiscal 1996 as compared to fiscal 1995. The increase was caused by a number of factors including:
o increase in salaries and an increase in the number of people in the sales and customer service area;
o increase in bad debts expenses; and
o increase in consulting fees paid.
Selling, general and administrative expenses increased by 6% in fiscal 1995 as compared to fiscal 1994. The increase was due to the incentive plan awards incurred in fiscal 1995. No incentive plan awards were granted in fiscal 1994 because the Company experienced a loss in that year.
Research and development costs increased in both fiscal 1995 and 1996 as compared to fiscal 1994 as the emphasis has moved from trying to get the M-II plant operating properly back to basic research and development. In addition, because the Company has become profitable, the funds available for research have increased. Research and development costs are expected to increase in fiscal 1997 to more than $300,000.
During fiscal 1996, the amount of interest income increased significantly as compared to prior years. The change was due to an increase in the level of cash balances during the year and $208,000 of interest earned on tax refunds received during the year.
In fiscal 1996, there was a $195 thousand miscellaneous expense compared to miscellaneous income of $159 thousand in fiscal 1995. The expense was attributable to foreign exchange losses in fiscal 1996 as compared to foreign exchange gains in fiscal 1995.
In the fourth quarter of fiscal 1996, the Company's net results were impacted by a $1,863,000 charge for costs associated with two expansion projects which were terminated. In fiscal 1992, the Company announced that it was going to evaluate the feasibility of constructing a melamine plant in a joint venture with a subsidiary of Norsk Hydro A.S. (Hydro). The Company was informed by Hydro during the last week of June 1996 that it had decided not to proceed with the project. In addition, the Company entered into negotiations with Arcadian Corporation (Arcadian) in August 1995 to build a melamine plant in Memphis, Tennessee. The Company and Arcadian were unable to agree on several substantive commercial terms and agreed jointly to terminate their negotiations. The costs associated with engineering and design of the two plant sites were expensed when the decision was reached not to proceed.
In addition, the fourth quarter of fiscal 1996 included a $480 thousand gain from a contract dispute resolution. During 1986, the Company and its natural gas supplies were unable to resolve a contract dispute regarding the price of natural gas. In the fourth quarter of fiscal 1996, the statute of limitation expired on the issue.
In the fourth quarter of fiscal 1995, the Company's operating results were negatively affected by:
o A 34% increase in the cost of raw material, which reduced operating income by $1.3 million; and
o A maintenance shut down during the last nine days of the month, which reduced production by about three million pounds.
Partially offsetting these negative factors was a 2.5_ per pound increase in the average selling price.
In the fourth quarter of fiscal 1994, the Company's operating results improved as compared to the previous three fiscal quarters. The improvement was due to a record sales volume of approximately 30 million pounds, a slightly better net sales price, larger production volume over which to spread fixed and semi-fixed costs, and lower raw material cost.
In the third quarter of fiscal 1994, the Company sold its controlled-release fertilizer technology for $1.8 million resulting in a gain of $1.7 million. This technology had previously been licensed and had generated yearly royalties of between $200 and $300 thousand.
The Company is subject to extensive regulation under federal, state and local environmental laws and regulations (see Item 1. "Business-Environmental and Other Regulatory Considerations"). In addition, the Company obtains its urea and anhydrous ammonia from Triad, which also is subject to extensive environmental regulation. The inability of Triad to comply with those laws and regulations could severely restrict the Company's ability to produce melamine. The Company is not aware of any existing circumstances that materially affect its or Triad's ability to comply with the applicable regulations.
LIQUIDITY AND CAPITAL RESOURCES
During fiscal 1996, the Company generated cash flow from operations of $2.8 million and spent $3.1 million in capital expenditures. The cash flow from operations would have been greater, but the Company used $2.2 million in increasing trade receivables for the increased level of sales and $1.7 million in increasing inventory to more acceptable levels.
Inventory levels declined by the end of fiscal 1994 to a two week supply, which the Company believes to be about half the acceptable level. During fiscal 1995, an attempt to build inventories to acceptable levels was not successful because of very strong demand. In fiscal 1996, the Company was able to increase inventory levels but is still below the four week level the Company tries to maintain.
In fiscal 1995, the Company generated cash flow from operations of $9.1 million, a $7.4 million increase from the prior year. The increase was due mainly to increased profitability and an increase in deferred income taxes. Capital expenditures increased to $1.7 million in fiscal 1995 and included about $500,000 for the construction of new salt coils that will be installed in the M-I plant in October 1995. It is anticipated that the level of capital expenditures in fiscal 1997 will approximate $2 million.
The Company has two $3.75 million lines of credit that expire in April 1997. The Company expects the level of borrowing in fiscal 1997 to be nominal and that the lines of credit will be sufficient to finance planned capital expenditures and any cash shortfalls from operations.
In May 1992, the Board of Directors eliminated the payment of dividends because of the lack of earnings and the need to conserve cash. While the future payment of dividends is at the discretion of the
Board of Directors, any future payments will include consideration of the Company's profitability, financial position and all liquidity requirements.
The Financial Acounting Standards Board (the FASB) issued Statement of Financial Accounting Standards (SFAS) No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of." This statement is effective for fiscal years beginning after December 15, 1995. The Company adopted the Standard, and it had no impact on the Company's results of operations or financial position.
The FASB also issued SFAS No. 123, "Acounting for Stock Based Compensation," effective also for fiscal years beginning after December 15, 1995. The new statement encourages, but does not require, companies to measure stock-based compensation cost using a fair value method, rather than the intrinsic value method prescribed by Accounting Principles Board (APB) Opinion No. 25. Companies choosing to continue to measure stock-based compensation using the intrinsic value method must disclose on a proforma basis net earnings and net earnings per share as if the fair value method were used. Management is currently evaluating the requirements of SFAS No. 123.
ITEM 8.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS, SUPPLEMENTARY DATA AND FINANCIAL STATEMENT SCHEDULES
INDEPENDENT AUDITORS' REPORT
The Board of Directors and Stockholders Melamine Chemicals, Inc.:
We have audited the consolidated financial statements of Melamine Chemicals, Inc. as listed in the accompanying index. In connection with our audits of the consolidated financial statements, we also have audited the consolidated financial statement schedule as listed in the accompanying index. These financial statements and financial statement schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial statements and financial statement schedule based on our audits.
We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by a management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Melamine Chemicals, Inc. as of June 30, 1996 and 1995, and the results of its operations and its cash flows for each of the years in the three-year period ended June 30, 1996, in conformity with generally accepted accounting principles. Also in our opinion, the related financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.
KPMG PEAT MARWICK LLP
Baton Rouge, Louisiana July 30, 1996
MELAMINE CHEMICALS, INC. CONSOLIDATED BALANCE SHEETS JUNE 30, 1996 AND 1995
See accompanying notes to consolidated financial statements.
MELAMINE CHEMICALS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS YEARS ENDED JUNE 30, 1996, 1995 AND 1994
See accompanying notes to consolidated financial statements.
MELAMINE CHEMICALS, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY YEARS ENDED JUNE 30, 1996, 1995 AND 1994
See accompanying notes to consolidated financial statements.
MELAMINE CHEMICALS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS YEARS ENDED JUNE 30, 1996, 1995 AND 1994
See accompanying notes to consolidated financial statements.
MELAMINE CHEMICALS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS June 30, 1996, 1995 and 1994
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Organization and Operations
Melamine Chemicals, Inc. (the Company) is engaged in the production and marketing of melamine crystal, a specialty chemical having numerous industrial and commercial applications. The Company is actively involved in the development of new uses for melamine and also in melamine related compounds that modify the characteristics of melamine resins.
At June 30, 1996, First Mississippi Corporation (First Mississippi) and a division of Ashland Inc. (Ashland) each owned 23.4% of the Company, which operates a melamine production facility.
The Company has a foreign sales corporation incorporated in the Virgin Islands and a holding company incorporated in Louisiana. The financial statements include the accounts of the Company and these subsidiaries. All significant intercompany balances and transactions are eliminated in consolidation.
(b) Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that could affect the reported amounts of assets at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results and the results of future periods could differ from those estimates.
(c) Inventories
Inventories of finished goods are stated at the lower of cost or market as determined by the last-in, first-out (LIFO) method. Supplies are stated at the lower of average cost or net realizable value. If the average cost method was used, finished goods inventories would be higher by $653,000 and $436,000 at June 30, 1996 and 1995, respectively.
(d) Plant and Equipment
Plant and equipment are stated at cost. Depreciation is provided over the estimated useful lives of the assets using the straight-line method. The estimated useful lives used to depreciate assets are:
Expenditures on an asset are capitalized until the asset is placed in service or until the recoverability of the expenditures becomes uncertain. Modifications to existing assets are capitalized when the modification increases the production capacity or extends the useful life of the assets.
(e) Income Taxes
Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.
(f) Postemployment, Pension and Other Postretirement Benefits.
The Company has a defined benefit pension plan covering all employees who have completed six months of employment. The benefits are based on years of service and the employee's highest average monthly compensation for any successive five year period.
The expected cost of post-retirement benefits is accrued during the years that an employee renders service to the employer.
The Company's pension funding policy is consistent with Federal laws and regulations. Prior service costs are being amortized over a 17-year period.
(g) Patent Costs
Patent costs are charged to research and development costs as incurred.
(h) Earnings Per Share
Primary and fully diluted earnings (loss) per share are computed based on the weighted average number of shares and dilutive equivalent shares of common stock (stock options) outstanding during each year using the treasury stock method.
(i) Cash and Temporary Investments
For purposes of the Statements of Cash Flows, the Company considers all highly liquid investment instruments purchased with a maturity of three months or less to be cash equivalents.
(j) Concentrations of Credit Risk and Other Risk
Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of trade accounts receivable. The credit risk in trade accounts receivable is mitigated by the Company's credit evaluation process and the geographical dispersion of sales transactions.
The Company currently purchases all of its urea and anhydrous ammonia, two significant raw materials, from one plant under a feedstock supply agreement. Periodic temporary shutdowns by the supplier are anticipated and the Company is generally able to build its finished goods inventory in sufficient quantity to prevent suspension of shipments to customers.
(2) RELATED PARTY TRANSACTIONS
A summary of significant transactions with related parties follows:
Direct expenses incurred by First Mississippi are allocated to the Company based on the actual costs incurred. Amounts paid to Triad Chemical for utilities and certain other services are based on actual costs, and shared costs and services are based on pro-rata allocations that reasonably approximate actual costs. Management believes that these methods of allocation are reasonable and that the costs would not be materially different on a stand-alone basis.
Since August 1986, the Company has purchased a substantial portion of its raw materials at approximate market prices under a long-term contract with First Mississippi which expires in June 2000. In July 1988, the Company agreed to an assignment in which one-half of First Mississippi's obligation to supply raw materials was assigned to another company, and First Mississippi agreed to guarantee the performance of the other company.
(3) PLANT AND EQUIPMENT
A summary of plant and equipment follows:
Maintenance and repairs charged to costs and expenses were $5,957,000, $6,599,000 and $4,810,000 for fiscal 1996, 1995 and 1994, respectively. Rent expense for all operating leases amounted to $12,025, $22,000 and $42,000 for fiscal 1996, 1995, and 1994, respectively.
(4) INCOME TAXES
Income tax expense (benefit) amounted to $1,284,868 for 1996 (an effective rate of 32%), $945,533 for 1995 (an effective rate of 22%) and $(1,410,778) for 1994 (an effective rate of 36%). The actual tax expense for these years differs from the expected tax expense as follows:
Components of income tax expense (benefit) are as follows:
Deferred income taxes result from timing differences in the recognition of income and expense for income tax and financial statement purposes. The sources of these differences and the tax effect of each are as follows:
The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and tax liabilities at June 30, 1996 and 1995 are presented below:
The Company's alternative minimum tax credit carryforwards are available to reduce future federal taxable income, if any, over an infinite period.
The Company reached an agreement in fiscal 1995 with the Internal Revenue Service (IRS) in connection with its audit of fiscal years 1987 through 1994. The IRS allowed additional tax basis for certain assets purchased in fiscal 1987. The impact of the agreement was a net tax benefit of $594,700.
(5) EMPLOYEE PENSION AND THRIFT PLANS
The Company has a noncontributory group annuity pension plan that covers all full-time employees who have completed six months of service, were hired prior to their 60th birthday and work 1,000 or more hours during the year. The right to discontinue the plan has been reserved by the Company, and, in such event, the accumulated plan benefits would be distributed to the participants. Approximately one-third of the plan assets are invested in U.S. government bonds with the remainder invested in U.S. equity securities.
Employee pension costs amounted to $257,994 for 1996, $205,862 for 1995 and $296,588 for 1994. Pension expense for fiscal 1995 decreased because of the change in the assumed rate of compensation increase.
The net pension cost included the following components:
The following table sets forth the plan's funded status and amounts recognized in the Balance Sheets at June 30, 1996 and 1995.
The Company has a contributory 401(k) thrift plan covering substantially all employees who have completed one year of service. Total expenses under the plan amounted to approximately $166,000 for 1996, $153,000 for 1995 and $143,000 for 1994.
(6) INDUSTRY SEGMENT AND EXPORT SALES
The Company's operations consist of one industry segment, and all of the operations are located in the United States. Export sales comprised 43%, 38% and 49% of net sales in fiscal 1996, 1995, and 1994, respectively. The same customer accounted for 13%, 13% and 12% of net sales in fiscal 1996, 1995 and 1994, respectively, and another customer also accounted for 13% and 12% of the net sales in fiscal 1995 and 1994, respectively.
(7) STOCKHOLDERS' EQUITY
A long-term incentive plan for officers and certain key employees of the Company was adopted in 1987 and amended in 1991 by the Company's stockholders. The Company reserved 500,000 shares of common stock for issuance upon the exercise of incentives awarded under the plan. Awards under the plan may be in the form of options to purchase common stock, convertible debentures, convertible preferred stock, stock appreciation rights, performance units, restricted stock, supplemental cash or other forms as the Board of Directors may direct.
Transactions under the Company's long-term incentive plan during fiscal 1994, 1995 and 1996 were as follows:
At June 30, 1996 options to purchase 261,934 shares were exercisable under the plan.
The Company adopted a Share Purchase Rights Plan ("Plan") on November 6, 1990 and amended the Plan August 7,1991 and August 3, 1994. Under the Plan, one Preferred Share Purchase Right ("Right") was distributed for each outstanding common share. The Right becomes exercisable if a person or group acquires 10% or more of the Company's common stock or announces a tender offer, the consummation of which would result in the ownership by such a person or group of 10% or more of the common stock. The terms of the Plan provide that current holdings of First Mississippi and Ashland do not trigger the provisions of the Plan. The Right entitles its holder to purchase, at the Right's then current exercise price, a number of the Company's common shares having a market value of twice such price. The plan expires on November 15, 1997 unless extended.
(8) COMMITMENTS AND CONTINGENCIES
The Company's plant is located on an eight-acre site near Donaldsonville, Louisiana. In June 1969, the plant site was leased by Triad to Ashland, which subsequently assigned a one-half interest in the lease to First Mississippi. Ashland and First Mississippi have assigned the lease to the Company. The plant site lease will expire on June 1, 2000, and the lessee has the right to extend the lease for four additional five-year terms or until 2020. The annual rent under the lease is $2,500 during the primary term and any additional terms.
The Company is obligated under other operating leases. At June 30, 1996, estimated minimum rental expense under noncancelable operating leases was as follows:
Various legal actions are pending against the Company which seek relief or damages including an action seeking contribution to cleaning costs of a Superfund site by plaintiff parties identified by the United States Environmental Protection Agency (EPA). The plaintiff companies seek to recover an unspecified amount of the cost of cleaning a Superfund site near the town of Sorrento, Louisiana. The plaintiff contends that they have spent $51 million and that the EPA is seeking reimbursement of $6 million. While the final outcome of these matters cannot be predicted with certainty at this time, management believes, after consulting with counsel, that the ultimate liability, if any, will not have a material effect on the consolidated financial position, results of operations and cash flow of the Company.
The Company has two $3.75 million revolving loan agreements with two banks which provide for lines of credit. Under the provisions of each of the agreements, the Company must pay interest at prime and maintain certain quarterly financial covenants as follows: current ratio 1.25 : 1; quick ratio .70 : 1; debt to equity ratio .50 : 1; and minimum net worth of $29 million. Both of these lines of credit expire on April 1, 1997 and are unsecured. At June 30, 1996, there were no amounts outstanding under these lines of credit.
Foreign currency transaction gains and losses are included in the determination of net income (loss). Transaction gains (losses) increased (decreased) net earnings in 1996, 1995 and 1994 by $(192,000), $93,000 and $53,000, respectively.
(9) OTHER INCOME AND EXPENSE
During the third quarter of fiscal 1994, the Company sold its controlled-release fertilizer technology for a net sales price of $1.8 million. The sale resulted in a pretax gain of $1,715,240.
In fiscal 1996, the Company wrote off $1,863,000 of costs associated with two expansion projects which were terminated. The write off included costs associated with the engineering and design of a plant to be located in Europe and a plant to be located in Memphis, Tennessee. In addition, the Company recognized a $479,827 gain from a contract dispute resolution. The contract dispute related to the price the Company's previous natural gas supplier was charging.
(10) NEW ACCOUNTING PRONOUNCEMENTS
The Financial Acounting Standards Board (the FASB) issued Statement of Financial Accounting Standards (SFAS) No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of." This statement is effective for fiscal years beginning after December 15, 1995. The Company adopted the Standard, and it had no impact on the Company's results of operations or financial position.
The FASB also issued SFAS No. 123, "Acounting for Stock Based Compensation," effective also for fiscal years beginning after December 15, 1995. The new statement encourages but does not require, companies to measure stock-based compensation cost using a fair value method, rather than the intrinsic value method prescribed by Accounting Principles Board (APB) Opinion No. 25. Companies choosing to continue to measure stock-based compensation using the intrinsic value method must disclose on a proforma basis net earnings and net earnings per share as if the fair value method were used. Management is currently evaluating the requirements of SFAS No. 123.
SUPPLEMENTAL INFORMATION
The quarterly financial data (unaudited) for the three years ended June 30, 1996 follows:
The tax rate for each quarter is based upon an estimate of the effective tax rate of the entire year. The tax rate in the third quarter of fiscal 1995 was impacted by a $594,700 settlement reached with the Internal Revenue Service.
ITEM 9.

ITEM 9. CHANGES IN AND DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURES
There have been no changes in accountants and no disagreements on accounting principles or practices, financial statement disclosure or auditing scope or procedure between the Company and its independent certified public accountants during the period beginning July 1, 1993 and ending on the date hereof.
PART III
ITEM 10.

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Information regarding directors of the Company is included on pages 3 to 5 of the Company's definitive proxy statement prepared in connection with the 1996 Annual Meeting of Shareholders to be held November 12, 1996 and is incorporated herein by reference. Certain information concerning the Company's officers is included in Item 4(a) of Part I of this report.
ITEM 11.

ITEM 11. EXECUTIVE COMPENSATION
Information regarding executive compensation is included on pages 6 to 9 of the Company's definitive proxy statement prepared in connection with the 1996 Annual Meeting of Shareholders to be held November 12, 1996 and is incorporated herein by reference.
ITEM 12.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Information regarding security ownership of certain beneficial owners and management is included on pages 2 to 3 of the Company's definitive proxy statement prepared in connection with the 1996 Annual Meeting of Shareholders to be held November 12, 1996 and is incorporated herein by reference.
ITEM 13.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Information regarding certain relationships and related transactions is included on pages 11 to 12 of the Company's definitive proxy statement prepared in connection with the 1996 Annual Meeting of Shareholders to be held November 12, 1996 and is incorporated herein by reference.
PART IV
ITEM 14.

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) l. Financial Statements
See Item 8 of PART II of this report.
2. Financial Statement Schedules
See Item 8 of Part II of this report.
3. Exhibits
3.1 Restated Certificate of Incorporation of the Company.(1)
3.2 Amended By-laws of the Company.(1)
3.3 Amendment No. 1 to Amended By-laws.(6)
3.4 Amendment No. 2 to Amended By-laws.(7)
4.1 See Exhibits 3.1 and 3.2 for provisions of the Company's Restated Certificate of Incorporation and Amended By-laws defining the rights of holders of Common Stock.
4.2 Specimen of Common Stock certificate.(1)
4.3 Registration Rights Agreement by and among the Company, Ashland and First Mississippi.(2)
10.1 Feedstock Agreement dated April 30, 1987, by and between the Company and First Mississippi, certain portions of which are filed under a request for confidential treatment under Rule 406 of the Securities Act of 1933, as amended, and the Freedom of Information Act(1)
10.2 United States Patent, Patent Number 4,565,867.(1)
10.3 MCI/Triad Intercompany Agreement dated June 10,1987, by and between the Company and Triad.(1)
10.4 Gas Sales Contract dated August 1, 1986, by and between Ponchartrain Natural Gas System and the Company.(1)
10.5 Site Lease Agreement dated November 4, 1970 and July 1, 1972, respectively, by and among Triad, First Mississippi, Mis Coa, Mississippi Chemical Corporation, Coastal Chemical Corporation and Ashland.(1)
10.6 Assignment of Site Lease dated July 23, 1987, by and among Triad, First Mississippi, Mississippi Chemical Corporation, Ashland and the Company.(1)
10.7 Amended and Restated Long-Term Incentive Plan.(1)
10.8 Employee 401(K) Thrift Plan and related Trust.(1)
10.9 Retirement Plan for Employees of the Company including First Supplement and related Trust.(1)
10.10 Indemnity Agreement by and between the Company and James W. Crook.(2)
10.11 Indemnity Agreement by and between the Company and Daniel D. Reneau.(2)
10.12 Indemnity Agreement by and between the Company and R. Michael Summerford.(2)
10.13 Indemnity Agreement by and between the Company and Charles M. McAuley.(2)
10.14 Indemnity Agreement by and between the Company and Scotty B. Patrick.(2)
10.15 Description of Annual Incentive Pay Plan.(3)
10.16 Assignment Agreement dated July 1, 1988, by and among the Company, Mississippi Chemical Corporation and First Mississippi.(3)
10.17 Standby Feedstock Agreement dated July 1, 1988, by and between the Company and First Mississippi(3)
10.18 Rights agreement dated November 15, 1990 and an amendment thereto dated August 7, 1991.(5)
10.19 Change of Control Severance Agreement by and between the Company and each of James W. Crook and Wayne D. DeLeo dated January 11, 1991 and Frederic R. Huber dated November 16, 1991(7)
10.20 Form of Change of Control Severance Agreement by and between the Company and each of its other exempt employees (in accordance with instruction 2 to item 60l of Regulation S-K other substantially identical contracts have been omitted and a schedule identifying the documents omitted and setting forth the material details in which such documents differ from the foregoing document has been included)(7)
10.21 Form of Amendment to Change of Control Severance Agreement (1991).(7)
10.22 Form of Amendment to Change of Control Severance Agreement (1992).(8)
10.23 Form of Amendment to Change of Control Severance Agreement by and between the Company and Martin F. Lapari.(8)
10.24 Employment Agreement dated November 16, 1991, by and between the Company and Frederic R. Huber.(8)
10.25 Indemnity Agreement by and between the Company and Nilon H. Prater.(9)
10.26 Indemnity Agreement by and between the Company and David J. D'Antoni.(9)
24.1 Consent of KPMG Peat Marwick LLP.
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(1) Incorporated by reference from the Company's Registration Statement on form S-1 (Registration No. 33- 15181).
(2) Incorporated by reference from the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 1987.
(3) Incorporated by reference from the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 1988.
(4) Incorporated by reference from the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 1989.
(5) Incorporated by reference from the Company's Current Reports on Form 8-K dated November 5, 1990 and August 7, 1991.
(6) Incorporated by reference to Section 4.4 of the Company's Form S-8 (Registration No. 33-20502).
(7) Incorporated by reference from the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 1991.
(8) Incorporated by reference from the Company's Annual Report on Form 10-K for fiscal year ended June 30, 1992.
(9) Incorporated by reference from the Company's Annual Report on Form 10-K for fiscal year ended June 30, 1993.
(b) Reports on Form 8-K
A Form 8-K dated July 25, 1995 was filed by the Company relating to the financial results for the year ended June 30, 1995.
A Form 8-K dated August 10, 1995 was filed by the Company relating to the signing of two letters of intent in connection with the proposed construction of a melamine plant near Memphis, Tennessee using the Company's patented M-II technology.
A Form 8-K dated September 1, 1995 was filed by the Company relating to a price increase for melamine crystal.
A Form 8-K dated October 16, 1995 was filed by the Company relating to the financial results for the three month period ended September 30, 1995.
A Form 8-K dated January 15, 1996 was filed by the Company relating to the financial results for the three and six month periods ended December 31, 1995.
A Form 8-K dated April 15, 1996 was filed by the Company relating to the financial results for the three and nine month periods ended March 31, 1996.
A Form 8-K dated July 1, 1995 was filed by the Company relating to ending plans for expansions in Europe and Tennessee.
A Form 8-K dated July 30, 1996 was filed by the Company relating to the financial results for the year ended June 30, 1996.
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 on September 11, 1996.
MELAMINE CHEMICALS, INC.
/S/ FREDERIC R. HUBER ------------------------------------- Frederic R. Huber President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the Registrant and on the dates indicated.
INDEX TO EXHIBITS
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(1) Incorporated by reference from the Company's Registration Statement on form S-1 (Registration No. 33- 15181).
(2) Incorporated by reference from the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 1987.
(3) Incorporated by reference from the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 1988.
(4) Incorporated by reference from the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 1989.
(5) Incorporated by reference from the Company's Current Reports on Form 8-K dated November 5, 1990 and August 7, 1991.
(6) Incorporated by reference to Section 4.4 of the Company's Form S-8 (Registration No. 33-20502).
(7) Incorporated by reference from the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 1991.
(8) Incorporated by reference from the Company's Annual Report on Form 10-K for fiscal year ended June 30, 1992.
(9) Incorporated by reference from the Company's Annual Report on Form 10-K for fiscal year ended June 30, 1993.