ITEM 1. BUSINESS
Owens-Corning Fiberglas Corporation, a Delaware corporation incorporated in 1938, is a world leader in advanced glass and composite materials. These products are used in industries such as home improvement, new construction, transportation, marine, aerospace, energy, appliance, packaging and electronics. Many of these products are marketed under the trademark FIBERGLAS.
Approximately eighty percent of the Company's sales are related to home improvements in the U.S., sales of composite materials and sales outside U.S. markets. Approximately twenty percent of the Company's sales are related to new U.S. residential construction.
Owens-Corning Fiberglas Corporation's executive offices are at Fiberglas Tower, Toledo, Ohio 43659; telephone (419) 248-8000. Unless the context requires otherwise, the terms "Owens-Corning" and "Company" in this report refer to Owens-Corning Fiberglas Corporation and its subsidiaries.
The Company operates in two industry segments -- Building Products and Industrial Materials -- divided into eleven strategic businesses. As a general rule, there is a commonality of process equipment and/or products within each industry segment.
The Company also has affiliate companies in a number of countries. Affiliated companies' sales, earnings and assets are not included in either industry segment unless the Company owns more than 50% of the affiliate.
Revenue, operating profit, and identifiable assets attributable to each of the Company's industry and geographic segments, as well as information concerning the dependence of the Company's industry segments on foreign operations, for each of the years 1994, 1993 and 1992, are contained in Note 1 to Owens-Corning's Consolidated Financial Statements, entitled "Industry Segments", on pages 35 through 40 hereof.
BUILDING PRODUCTS
Principal Products And Methods Of Distribution
Building Products operates primarily in North America and Europe. It also has a growing presence in Latin America and Asia/Pacific, through joint venture and licensee relationships. Building Products sells a variety of building and home improvement products in three major categories: insulation, roofing materials, and windows/patio doors and other specialty products for the home exterior, such as PinkWrap(TM). The strategic businesses responsible for these products and markets include: Insulation - North America, Building Products-Europe, Retail/ Distribution, Roofing/Asphalt, Specialty and Foam Products, Western Fiberglass Group, Latin America, and Asia/Pacific.
The Company's Retail/Distribution business is a major source of sales of building insulation products to lumber yards and home centers, and roofing shingles and windows/patio doors to retailers and distributors. These products are used in the home improvement and new residential construction markets. In 1994, this distribution channel accounted for nearly 40% of all of the Company's building product sales and 25% of total overall corporate sales. More than 75% of the Company's Retail/Distribution sales are related to repair and remodeling activity within the home improvement industry.
Other channels for the Company's building products include sales of insulation products in North America to insulation contractors, metal building insulation fabricators and distributors, specialty insulation contractors, manufactured housing producers, and appliance and equipment manufacturers. In Europe, the Company sells building insulation to large insulation wholesalers, builders/merchants, distributors and retailers. The Company sells mechanical insulation products to distributors, fabricators, and manufacturers for use in the heating, ventilation, power and process, appliance, and fire protection industries. Fabrication centers fabricate and sell insulation products to original equipment manufacturers and metal building erectors and provide fabrication services for other Owens-Corning marketing organizations.
In Latin America, the Company produces and sells building and mechanical insulation through joint venture and licensee relationships. In the Asia/Pacific region, the Company sells primarily mechanical insulation through licensees and joint venture businesses.
In North America, the Company sells foam products to distributors and retailers who resell to residential builders, remodelers and do-it-yourself customers. The Company serves the commercial and industrial markets through specialty distributors. The Company has licensed others for the manufacture of foam products in nine locations globally in Canada, Europe, the Middle East and Asia. The Company sells foam products through traditional agents and distributors where licensing does not exist.
The Company sells windows and patio doors to retailers for re-sale to contractors and do-it-yourself customers in the replacement and new construction markets.
The Company sells roofing shingles to distributors and retailers, who resell them to residential roofing and remodeling contractors, as well as to do-it- yourself customers. Approximately 75% of roofing shingles sold in North America are used for re-roofing, with new residential construction accounting for the remainder.
The Company sells industrial asphalt under the Trumbull(TM) brand name. There are three principal kinds of industrial asphalt: Built-Up Roofing Asphalt (BURA), used in commercial roofing systems to provide waterproofing and adhesion; saturants or coating asphalt, used to manufacture roofing felts and shingles; and industrial specialty asphalt, used by manufacturers in a variety of products such as waterproofing systems, adhesives, coatings, and product extenders, as well as in various automotive applications.
There are various channels of distribution for the Company's asphalt products. The Company's asphalt products are used internally in the manufacture of the Company's residential roofing products and are also sold to other shingle manufacturers. In addition, asphalt is sold to roofing contractors and distributors for BURA systems and to manufacturers in a variety of other industries, including automotive, chemical, rubber, and construction.
Seasonality
Sales in the Building Products segment tend to follow seasonal home improvement, remodeling and renovation, and new construction industry patterns. Sales levels for the segment, therefore, are typically lower in the winter months.
Major Customers
No customer in the Building Products segment accounts for more than three percent of the segment's sales.
INDUSTRIAL MATERIALS
Principal Products and Methods of Distribution
Industrial Materials operates primarily in North America with subsidiaries in Europe and Latin America, affiliates and licensees around the world, and a growing presence in Asia/Pacific. The strategic businesses responsible for these products include: Composites, Latin America, Pipe, and Asia/Pacific.
The Company is the world's leading producer of glass fiber materials used in composites. Composites are fabricated material systems made up of two or more components (e.g., plastic resin and glass fiber) used in various applications to replace traditional materials, such as aluminum, wood, and steel. The global composites industry has expanded to include more than 40,000 end-use products. Worldwide, the composites industry has relatively few raw material component suppliers (glass fiber, resin and additives) delivering to thousands of industrial customers through various channels. Depending on the end-use application, these raw materials move through different manufacturing process chains, ultimately finding their way to consumers through myriad markets covering all regions of the world.
A major end-use application for glass fiber is asphaltic roofing shingles, where glass fiber is used to provide fire and mildew resistance in 95% of all shingles produced in North America. The Company sells glass fiber and/or mat directly to a small number of major shingle manufacturers (including the Company's own roofing business).
Tubs, showers and other related internal building components used for both remodeling and new construction are also major applications of glass fiber materials. These end-use products are some of the first successful material substitution conversions normally encountered in developing countries. Glass fiber for these markets is sold to direct accounts, and also to distributors around the world, who in turn service thousands of customers.
The use of glass fibers within the automotive industry continues to grow as the amount of composite materials used per vehicle increases. There are hundreds of composites applications, including exterior and interior body panels, instrument panels, bumpers, lamp housings, headliners, packaging for electronics, valve covers, luggage racks, distributor caps, timing belts, mufflers and tanks for alternative fuel vehicles. These composite parts are either produced by the original equipment manufacturer (OEM), or are purchased by the OEMs from first-tier suppliers. Glass fibers for these parts are sold mostly to first-tier and second-tier OEM suppliers.
Glass fiber is used extensively in printed circuit boards made for the consumer electronics, transportation, and telecommunications industries. The Company sells glass fiber to a small number of major fabric weavers, who, in turn, supply the rest of the circuit board production value chain. Applications also include connectors, circuit breaker boxes, computer housings, electricians' safety ladders, and hundreds of various electro/mechanical components.
The Company manufactures glass-reinforced plastic pipe designed for use in underground pressure and gravity fluid handling systems. The pipe is a structural composite incorporating glass fiber, polyester resins, and other component materials.
The Company has established a Center of Excellence for its pipe business in Sandefjord, Norway. In addition to manufacturing pipe, this operation provides technical and manufacturing support for the Company's joint ventures and wholly-owned pipe operations around the world. The Company has pipe joint ventures in Thailand, Saudi Arabia, Germany, Spain and Botswana. In China, a wholly-owned pipe plant is currently under construction in Changchun. Through its pipe business and technology licensees around the world, the Company sells its pipe directly to governments and private industry for major infrastructure projects, such as water and sewage transport systems.
Major Customers
No customer in the Industrial Materials segment accounts for more than four percent of the segment's sales.
GENERAL
Raw Materials And Patents
Owens-Corning considers the sources and availability of raw materials, supplies, equipment and energy necessary for the conduct of its business in each industry segment to be adequate.
The Company has numerous U.S. and foreign patents issued and applied for relating to its products and processes in each industry segment resulting from research and development efforts. The Company has issued royalty- bearing patent licenses to companies in several foreign countries. The licenses cover technology relating to both industry segments.
Including the registered trademark Fiberglas, the Company has approximately 82 trademarks registered in the United States and approximately 339 trademarks registered in other countries.
The Company considers its patent and trademark positions to be adequate for the present conduct of its business in each of its industry segments.
Working Capital
Owens-Corning's manufacturing operations in each of its industry segments are generally continuous in nature and it warehouses much of its production prior to sale since it operates primarily with short delivery cycles. Inventories of finished goods, materials and supplies were within historical ranges at year-end 1994, when expressed as a percentage of fourth quarter annualized sales.
Research And Development
During 1994, 1993 and 1992, the Company spent approximately $64 million, $61 million, and $55 million, respectively, for research and development activities. Customer sponsored research and development was not material in any of the last three years.
Environmental Control
Owens-Corning's capital expenditures relating to compliance with environmental control requirements were approximately $15 million in 1994. The Company currently estimates that such capital expenditures will be approximately $21 million in 1995 and $20 million in 1996.
The Company does not consider that it has experienced a material adverse effect upon its capital expenditures or competitive position as a result of environmental control legislation and regulations. Operating costs of environmental control equipment, however, were approximately $57 million in 1994. Owens-Corning continues to invest in equipment and process modifications to remain in compliance with applicable environmental laws and regulations.
The 1990 Clean Air Act Amendments (Act) provide that the United States Environmental Protection Agency will issue regulations on a number of air pollutants over a period of years. Until these regulations are developed, the Company cannot determine the extent the Act will affect it. The Company anticipates that its sources to be regulated will include glass fiber manufacturing and asphalt processing activities. The Company currently expects glass fiber manufacturing to be regulated by 1997. Based on information now known to the Company, including the nature and limited number of regulated materials it emits, the Company does not expect the Act to have a material adverse effect on the Company's results of operations, financial condition, or long-term liquidity.
Number Of Employees
During 1994 Owens-Corning averaged approximately 17,200 employees. The Company had approximately 17,000 employees at December 31, 1994.
Competition
Owens-Corning's products compete with a broad range of products made from numerous basic, as well as high-performance, materials.
The Company competes with a number of manufacturers in the United States of glass fibers in primary forms, not all of which produce a broad line of glass fiber products. Approximately one-half of these producers compete with the Company's Building Products industry segment in the sale of glass fibers in primary form. A similar number compete with the Company's Industrial Materials industry segment. Companies in other countries, primarily Japan, export glass fiber products to the United States. The Company also competes outside the United States against a number of manufacturers of glass fibers in primary forms.
Owens-Corning also competes with many manufacturers, fabricators and distributors in the sale of products made from glass fibers. In addition, the Company competes with many other manufacturers in the sale of industrial asphalts and other products.
Methods of competition include product performance, price, terms, service and warranty.
ITEM 2.
ITEM 2. PROPERTIES
PLANTS
Owens-Corning's plants as of March 1, 1995 are listed below by industry segment and primary products, and are owned except as noted. The Company considers that these properties are in good condition and well maintained, and are suitable and adequate to carry on the Company's business. The capacity of each plant varies depending upon product mix.
BUILDING PRODUCTS SEGMENT
Thermal And Acoustical Insulation
Barrington, New Jersey* Newark, Ohio Delmar, New York Palestine, Texas* Eloy, Arizona Salt Lake City, Utah Fairburn, Georgia Santa Clara, California Kansas City, Kansas Waxahachie, Texas Mount Vernon, Ohio
Candiac, Canada Queensferry, United Kingdom Edmonton, Canada Ravenhead, United Kingdom Guangzhou, China** Scarborough, Canada Pontyfelin, United Kingdom Vise, Belgium
*Facility is mothballed. **Under construction.
Roofing And Asphalt Processing (one of each at every location, except as noted)
Atlanta, Georgia Medina, Ohio Brookville, Indiana (1) Memphis, Tennessee Compton, California Minneapolis, Minnesota Denver, Colorado Morehead City, North Detroit, Michigan (2) Carolina (2) (3) Houston, Texas Oklahoma City, Oklahoma (2) Irving, Texas Portland, Oregon (4) Jacksonville, Florida (3) Savannah, Georgia Jessup, Maryland Summit, Illinois (3) Kearney, New Jersey
(1) Roofing plant only. (2) Asphalt processing plant only. (3) Facility is partially leased. (4) Two asphalt processing plants, as well as one roofing plant.
Specialty and Foam Products
Hazleton, Pennsylvania Rockford, Illinois Martinsville, Virginia* Tallmadge, Ohio
*Facility is leased.
INDUSTRIAL MATERIALS SEGMENT
Textiles And Reinforcements
Aiken, South Carolina Fort Smith, Arkansas Amarillo, Texas Huntingdon, Pennsylvania Anderson, South Carolina Jackson, Tennessee*
Apeldoorn, The Netherlands Liversedge, United Kingdom Battice, Belgium Rio Claro, Brazil Birkeland, Norway San Vincente deCastellet/ Guelph, Canada Barcelona, Spain L'Ardoise, France Wrexham, United Kingdom
*Facility is leased.
Pipe
Changchun, China** Sandefjord, Norway*
*Facility is leased. **Under construction.
OTHER PROPERTIES
Owens-Corning's general offices of approximately 300,000 square feet are located in the Fiberglas Tower, Toledo, Ohio. The lease for these offices terminates December 31, 1996. Under separate leases, the Company has additional general office space of approximately 145,000 square feet, and warehouse space of approximately 100,000 square feet, located in other buildings in Toledo.
The Company's research and development function is conducted at its Science and Technology Center, located on approximately 500 acres of land outside Granville, Ohio. It consists of twenty-three structures totaling approximately 635,000 square feet, of which 25,000 square feet were mothballed at the end of 1994.
ITEM 3.
ITEM 3. LEGAL PROCEEDINGS
The paragraphs in Note 21 to the Company's Consolidated Financial Statements, entitled "Contingent Liabilities", on pages 64 through 69 hereof, are incorporated here by reference.
Securities and Exchange Commission rules require the Company to describe certain governmental proceedings arising under federal, state or local environmental provisions unless the Company reasonably believes that the proceeding will result in monetary sanctions of less than $100,000. The following proceedings are reported in response to this requirement. Based on the information presently available to it, however, the Company believes that the costs which may be associated with these matters will not have a materially adverse effect on the Company's financial position or results of operations.
As previously reported, the Company and more than 100 other companies have signed individual agreements with the United States Environmental Protection Agency (EPA) to conduct a Toxic Substance Control Act (TSCA) Audit Program to determine compliance status under TSCA section 8(e). The agreement provides that the Company will audit its records and report to the EPA any reportable matters which were not reported or which were reported late. The Company will pay stipulated penalties of up to $15,000 for each matter not timely reported, with a maximum penalty of $1 million in the aggregate. The Company has completed the portion of the audit dealing with substantial risk of injury to health. It has not been notified as to the amount of penalties it will be required to pay but estimates that the penalty for health related filings will be less than $150,000. The final report to the EPA, regarding environmental issues, is due six months after the EPA publishes final refined guidance on such reporting.
In the third quarter of 1994, the Company reported to the Texas Natural Resource Conservation Commission (TNRCC) that it had discovered that the glass forming areas of its Amarillo, Texas plant were operating without certain required air permits. The TNRCC and the Company are working together to resolve this matter. The Company is unable at this time to determine the amount of penalties that may be sought by the TNRCC.
During the first quarter of 1995, the Company signed a consent order with the Tennessee Department of Environment and Conservation, providing for a remedial investigation and feasibility study for two state Superfund sites. The Company is the primary generator in both sites.
ITEM 4.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Owens-Corning has nothing to report under this Item.
Executive Officers of the Company (as of March 1, 1995)
The term of office for elected officers is one year from the annual election of officers by the Board of Directors following the Annual Meeting of Stockholders on the third Thursday of April. All those listed have been employees of Owens-Corning during the past five years except as indicated.
Name and Age Position*
Glen H. Hiner (60) Chairman of the Board and Chief Executive Officer since January 1992; formerly Senior Vice President - G.E. Plastics at General Electric Company (1983). Director since 1992.
Alan D. Booth (52) Vice President and President, Insulation - North America since January 1994; formerly Vice President, Insulation Division, Construction Products Group (1993) and Vice President, Mechanical Products Division (1986).
David T. Brown (46) Vice President and President, Roofing/Asphalt since January 1994; formerly Vice President, Roofing/Asphalt Division (1993) and Vice President, Atlanta Regional Sales, Building Materials (1986).
Christian L. Campbell (44) Senior Vice President, General Counsel and Secretary since January 1995; formerly Vice President, General Counsel and Secretary at Nalco Chemical (1990).
Domenico Cecere (45) Vice President and Controller since November 1993; formerly Vice President, Finance and Administration, Europe (1992), Vice President and Assistant Controller (1991) and Vice President, Finance, Industrial Business (1990) at Honeywell, Inc.
Charles H. Dana (55) Executive Vice President since January 1994; formerly Senior Vice President, OCF, and President - Industrial Materials Group (1989).
Name and Age Position*
David W. Devonshire (49) Senior Vice President and Chief Financial Officer since July 1993; formerly Corporate Vice President, Finance (1992) and Corporate Vice President and Controller (1990) at Honeywell, Inc.
Carl B. Hedlund (47) Vice President and President, Retail/Distribution since January 1994; formerly Vice President, Retail and Distribution, Construction Products Group (1993), Vice President, Roofing Products Operating Division (1989).
Robert C. Lonergan (51) Vice President and President, Science and Technology since January 1995; formerly President, Windows (1993); and President of Reb Plastics, Inc. (1984).
Bradford C. Oelman (57) Vice President - Corporate Relations since November 1986.
Gregory M. Thomson (47) Senior Vice President, Human Resources since October 1994; formerly Vice President, Human Resources, Public Service Electric & Gas (1988).
Efthimios O. Vidalis (40) Vice President and President, Composites since January 1994; formerly Vice President, Reinforcements Division, Europe (1986).
*Information in parentheses indicates year in which service in position began.
Part II
ITEM 5.
ITEM 5. MARKET FOR OWENS-CORNING'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
The principal market on which Owens-Corning's common stock is traded is the New York Stock Exchange. The high and low sales prices in dollars per share for Owens-Corning's common stock as reported in the consolidated transaction reporting system for each quarter during 1994 and 1993 are set forth in the following tables.
1994 High Low 1993 High Low
First Quarter 46 33-1/2 First Quarter 47 34-3/8
Second Quarter 36-1/8 30-1/2 Second Quarter 45-1/4 36-1/4
Third Quarter 36-1/4 30-1/8 Third Quarter 45-5/8 40-1/4
Fourth Quarter 33-1/2 27-3/4 Fourth Quarter 49-1/8 42-1/2
The number of stockholders of record of the Company's common stock on February 21, 1995 was 7,358.
No dividends have been declared by the Company since the Company's November 5, 1986 recapitalization. In connection with certain of its current bank credit facilities, the Company has agreed to restrictions affecting the payment of cash dividends. As of January 1, 1995, these restrictions limited funds available for the payment of cash dividends by the Company to approximately $38 million. While the Company periodically evaluates the advisability of paying dividends, it currently does not anticipate paying dividends during 1995.
The Company has two unsecured, variable rate, long-term bank credit facilities. The first facility was amended in July 1994 and has a maximum commitment of $475 million at December 31, 1994, of which $211 million was used for standby letters of credit and $229 million was unused. The rate of interest is either the bank's base rate, or 13/16% over the certificate of deposit rate, or 11/16% over the London Interbank Offered Rate (LIBOR). The rate of interest on borrowings under this facility was 6.8125% at December 31, 1994. A commitment fee of 1/4 of 1% is charged on the unused portions of this facility.
The second long-term facility is payable in Canadian dollars and has a maximum commitment of 95 million Canadian dollars (68 million U.S. dollars) at December 31, 1994, of which 89 million Canadian dollars (64 million U.S. dollars) was unused. This facility replaced the previous Canadian facility which expired in July 1994. The rate of interest is either 11/16% over the Canadian cost of funds rate, or 11/16% over the LIBOR rate on U.S. deposits, or .7875% over the Canadian bankers' acceptance rate. The rate of interest on borrowings under this facility was 8.0% at December 31, 1994. A commitment fee of 1/4 of 1% is charged on the unused portions of this facility.
OWENS-CORNING FIBERGLAS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
2. Long-Term Debt (Continued)
As is typical for bank credit facilities, the agreements relating to the facilities described above contain restrictive covenants, including requirements for the maintenance of working capital, interest coverage, and minimum coverage of fixed charges; and limitations on the early retirement of subordinated debt, additional borrowings, certain investments, payment of dividends, and purchase of Company stock. The agreements include a provision which would result in all of the unpaid principal and accrued interest of the facilities becoming due immediately upon a change of control in ownership of the Company. A material adverse change in the Company's business, assets, liabilities, financial condition or results of operations constitutes a default under the agreements.
The convertible junior subordinated debentures are subordinated to all present and future indebtedness of the Company and may be redeemed at any time, at a premium, at the option of the Company. The debentures are convertible at any time into shares of common stock of the Company at a conversion price of $29.75 per share. The Company has reserved approximately six million additional shares of common stock necessary for conversion.
In November 1994, Owens-Corning Finance (U.K.) PLC, a newly formed wholly- owned subsidiary of the Company, issued $140 million of Eurobonds. These bonds bear a coupon rate of interest of 9.814%, payable semiannually, and mature in 2019. These bonds are convertible into fixed rate preference shares of Owens-Corning Finance (U.K.) PLC in November 2004 and may be redeemed at any time, at a premium, at the option of the Company. The bonds are guaranteed by the Company as to payments of principal and interest and rank similarly with all other senior unsecured debt of the Company (Note 19). Subsequently, in a separate transaction, the Company sold a put option to the holder of the bonds allowing the option holder to require the Company to purchase a portion of the bonds for $79 million on May 28, 1995. During January 1995, the Company received, from an option holder, a notice of intent to exercise approximately 30% of these put options.
During 1992, the Company called, prior to maturity, its 12% sinking fund debentures having a face value of $46 million at a price in excess of book value, which resulted in an extraordinary loss of $1 million, or $.02 per share, net of related income taxes of $1 million.
In June 1992, the Company called, prior to maturity, its senior subordinated debentures having a face value of $240 million, which resulted in an extraordinary loss of approximately $2 million, or $.05 per share, net of related income taxes of $1 million.
OWENS-CORNING FIBERGLAS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
2. Long-Term Debt (Continued)
The aggregate maturities and sinking fund requirements for all long-term debt issues for each of the five years following December 31, 1994 are:
3. Short-Term Debt
During 1994, the Company established an unsecured, variable rate, short-term bank credit facility in order to finance the 1994 acquisition of Pilkington (Note 4). This facility has a maximum commitment of $110 million at December 31, 1994, all of which was used. This facility expires on May 31, 1995 and carries an interest rate of 1/2 of 1% over the LIBOR rate. The rate of interest on borrowings under this facility was 6.6875% at December 31, 1994.
The Company had unused short-term lines of credit totalling $91 million and $115 million at December 31, 1994 and 1993, respectively.
4. Acquisitions and Divestitures of Businesses
On May 31, 1994, the Company acquired UC Industries, Inc. ("UCI"), a privately held foam board insulation manufacturer based in New Jersey. UCI has two manufacturing facilities which are located in Ohio and Illinois.
OWENS-CORNING FIBERGLAS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
4. Acquisitions and Divestitures of Businesses (Continued)
The purchase price of UCI was $45 million. This business combination was consummated by the exchange of 855,556 shares of the Company's common stock for all of the capital stock of UCI, as well as an $18 million cash payment, $6 million of which was paid to acquire the cash of UCI. The remaining $12 million cash payment represents a stock value settlement and was paid during the fourth quarter of 1994.
On June 2, 1994, the Company acquired Pilkington Insulation Limited and Kitsons Insulation Products Limited (collectively, "Pilkington"), the United Kingdom-based insulation manufacturing and distribution businesses of the Pilkington Group. With two fiber glass insulation manufacturing facilities and one rock wool manufacturing facility, Pilkington Insulation Limited is the United Kingdom's largest manufacturer of fiber glass and rock wool insulation. Kitsons Insulation Products Limited is a major supplier of thermal and acoustical insulation products to the United Kingdom construction industry and is comprised of 14 distribution centers.
The purchase price of Pilkington was $110 million and was financed with borrowings from the Company's short-term bank credit facility (Note 3).
These acquisitions were accounted for using the purchase method of accounting. Accordingly, the assets acquired and liabilities assumed have been recorded at their fair values and the results of operations of UCI and Pilkington have been included in the Company's consolidated financial statements subsequent to May 31, 1994 and June 2, 1994, respectively.
The purchase price allocations were based on preliminary estimates of fair market value and are subject to revision. The estimated fair value of assets acquired from UCI, including goodwill and a non-competition agreement, was $72 million, and liabilities assumed, including $14 million in debt, totalled $27 million. The estimated fair value of assets acquired from Pilkington, including goodwill, was $165 million, and liabilities assumed, including $7 million in debt, totalled $55 million. Goodwill of $78 million and the non-competition agreement of $6 million are being amortized over 40 years and 7 years, respectively, on a straight-line basis.
UCI and Pilkington added $134 million in post-acquisition sales for the Company during 1994. The pro forma effect of these acquisitions was not material to net income for the year ended December 31, 1994 or 1993.
On September 30, 1994, the Company entered into a joint venture with Alpha Corporation of Tennessee, whereby the two companies combined their existing resin businesses to form Alpha/Owens-Corning, L.L.C., the largest manufacturer of polyester resins in North America. The Company contributed two manufacturing plants (Valparaiso, Indiana and Guelph, Ontario) and owns a 50 percent interest in the joint venture. This joint venture is being accounted for under the equity method. For the nine months ended September 30, 1994 and the years ended December 31, 1993 and 1992, resin sales totalled $58 million, $63 million, and $56 million, respectively, and were included in the Industrial Materials segment.
OWENS-CORNING FIBERGLAS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
4. Acquisitions and Divestitures of Businesses (Continued)
Late in the fourth quarter of 1994, the Company completed the sale of its underground storage tank manufacturing business. Sales for this business totalled $41 million, $43 million, and $48 million in 1994, 1993, and 1992, respectively, and were included in the Building Products segment.
5. Restructuring of Operations and Other Initiatives
During the first quarter of 1994, the Company recorded a $117 million pretax charge for productivity initiatives and other actions aimed at reducing costs and enhancing the Company's speed, focus, and efficiency. This $117 million pretax charge is comprised of an $89 million charge associated with the restructuring of the Company's business segments, as well as a $28 million charge, primarily composed of final costs associated with the administration of the Company's former commercial roofing business. The components of the $89 million restructure charge include: $48 million for personnel reductions, $22 million for divestiture of non-strategic businesses and facilities, $16 million for business realignments, and $3 million for other actions. The $48 million cost for personnel reductions primarily represents severance costs associated with the elimination of nearly 400 positions worldwide. The primary employee groups affected include science and technology personnel, field sales personnel, corporate administrative personnel, and commercial roofing and resin business personnel.
As of December 31, 1994, the Company has recorded approximately $50 million in costs against its 1994 restructure reserve, of which $35 million represents actual cash expenditures and $15 million represents the non-cash effects of asset write-offs and business realignments. The $35 million cash expenditure includes personnel reduction costs of $22 million, primarily composed of partial payments of severance costs for over 300 employees. The remaining $13 million cash expenditure represents costs associated with the divestiture or realignment of businesses and facilities.
During the first quarter of 1993, the Company recorded a $23 million charge to reorganize its European operations. This charge included $17 million for personnel reductions and $6 million for the writedown of fixed assets.
During the fourth quarter of 1992, the Company recorded a $16 million charge to reorganize its Building Products segment and to centralize its accounting and information systems. This charge included $14 million for personnel reductions and $2 million for the writedown of assets.
OWENS-CORNING FIBERGLAS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
6. Glass Melting Furnace Rebuilds
Effective January 1, 1994, the Company adopted the capital method of accounting for the cost of rebuilding glass melting furnaces. Under this method, costs are capitalized when incurred and depreciated over the estimated useful lives of the rebuilt furnaces. Previously, the Company established a reserve for the future rebuilding costs of its glass melting furnaces through a charge to earnings between dates of rebuilds. The change to the capital method provides a more appropriate measure of the Company's capital investment and is consistent with industry practice. The cumulative effect of this change in accounting method was an increase to earnings of $123 million, or $2.45 per share, net of related income taxes of $54 million. The effect of this change in accounting method was to increase depreciation expense and eliminate furnace rebuild provision. The pro forma effect of this change was not material to net income for the year ended December 31, 1993 and was $7 million, or $.15 per share, for the year ended December 31, 1992.
7. Postemployment and Postretirement Benefits Other Than Pensions
The Company and its subsidiaries maintain health care and life insurance benefit plans for certain retired employees and their dependents. The health care plans in the U.S. are unfunded and pay either 1) stated percentages of covered medically necessary expenses, after subtracting payments by Medicare or other providers and after stated deductibles have been met, or 2) fixed amounts of medical expense reimbursement. Employees become eligible to participate in the health care plans upon retirement under one of the Company's pension plans if they have accumulated 10 years of service after age 45. Some of the plans are contributory, with some retiree contributions adjusted annually. The Company has reserved the right to change or eliminate these benefit plans subject to the terms of collective bargaining agreements during their term. During 1993, the Company approved changes in its postretirement health care plans for retirees and active employees. These changes, which reduced the accumulated benefit obligation by $120 million and 1993 expense by $18 million, resulted in an unrecognized net reduction in prior service cost which will be amortized through 1999.
Effective January 1, 1994, the Company adopted Statement of Financial Accounting Standards No. 106, "Employers' Accounting for Postretirement Benefits Other Than Pensions" for its non-U.S. plans. Accordingly, the expected cost of postretirement benefits is charged to expense during the years in which eligible employees render service. The cumulative effect of the adoption of this standard was a charge of $10 million, or $.20 per share. (The Company adopted Statement No. 106 for its U.S. plans effective January 1, 1991.)
The following table reconciles the status of the accrued postretirement benefits cost liability at October 31, 1994 and 1993, as reflected on the balance sheet as of December 31, 1994 and 1993:
OWENS-CORNING FIBERGLAS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
7. Postemployment and Postretirement Benefits Other Than Pensions (Continued)
For measurement purposes, an 11% annual rate of increase in the per capita cost of covered health care claims was assumed for 1995. The rate was assumed to decrease to 10.5% for 1996, then decrease gradually to 6% by 2005. The health care cost trend rate assumption has a significant effect on the amounts reported. To illustrate, increasing the assumed health care cost trend rate by one percentage point in each year would increase the accumulated postretirement benefits obligation as of October 31, 1994, by $13 million and the aggregate of the service and interest cost components of net postretirement benefits cost for the year then ended by $2 million. The discount rate used in determining the accumulated postretirement benefits obligation was 8.5% in 1994, 7.5% in 1993, and 8.25% in 1992.
OWENS-CORNING FIBERGLAS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
7. Postemployment and Postretirement Benefits Other Than Pensions (Continued)
Effective January 1, 1994, the Company adopted Statement of Financial Accounting Standards No. 112, "Employers' Accounting for Postemployment Benefits." This standard requires the Company to recognize the obligation to provide benefits to former or inactive employees after employment but before retirement under certain conditions. These benefits include, but are not limited to, salary continuation, supplemental unemployment benefits, severance benefits, disability-related benefits (including workers' compensation), job training and counseling, and continuation of benefits such as health care and life insurance coverage. The cumulative effect of the adoption of this standard was an undiscounted charge of $28 million, or $.56 per share, net of related income taxes of $18 million. At December 31, 1994, the Company's liability for postemployment benefits totalled $44 million, including current liabilities of $5 million, and is included in other employee benefits liability in the Company's consolidated balance sheet. Postemployment benefits expense was $3 million for the year ended December 31, 1994.
8. Pension Plans
The Company has several defined benefit pension plans covering most employees. Under the plans, pension benefits are generally based on an employee's number of years of service. Company contributions to these pension plans are based on the calculations of independent actuaries using the projected unit credit method. Plan assets consist primarily of equity securities with the balance in fixed income investments or insurance contracts. The unrecognized cost of retroactive amendments and actuarial gains and losses are amortized over the average future service period of plan participants expected to receive benefits.
The Company also sponsors defined contribution plans available to substantially all U.S. employees. Company contributions for the plans are based on matching a percentage of employee savings up to a maximum savings level. The Company's contributions were $10 million in 1994, $9 million in 1993, and $7 million in 1992.
9. Income Taxes
Effective January 1, 1993, the Company adopted Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes." Statement No. 109 changes the criteria for measuring the provision for income taxes and recognizing deferred tax assets and liabilities. Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of corresponding liabilities and assets using enacted tax rates in effect for the year in which the differences are expected to reverse. The cumulative effect of the adoption of this standard was an increase to earnings of $26 million, or $.53 per share.
As of December 31, 1994, the Company has not provided for withholding or U.S. federal income taxes on approximately $124 million of accumulated undistributed earnings of its foreign subsidiaries as they are considered by management to be permanently reinvested. If these undistributed earnings were not considered to be permanently reinvested, approximately $11 million of deferred income taxes would have been provided.
During 1994, the Company utilized tax net operating loss carryforwards for certain of its foreign subsidiaries of approximately $9 million. At December 31, 1994, the Company had tax net operating loss carryforwards for certain of its foreign subsidiaries of approximately $27 million, certain of which expire through 1999.
For the year ended December 31, 1992, the Company utilized book net operating loss carryforwards which resulted in an extraordinary credit of approximately $4 million, or $.08 per share.
OWENS-CORNING FIBERGLAS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
9. Income Taxes (Continued)
The cumulative temporary differences giving rise to the deferred tax assets and liabilities at December 31, 1994 and 1993 are as follows:
Management fully expects to realize its net deferred tax assets through income from future operations.
The Company's equity in undistributed net income of affiliates was $32 million at December 31, 1994.
The Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents.
See Note 4 for supplemental disclosure of Non-cash Investing and Financing Activities.
16. Leases
The Company leases certain manufacturing equipment and office and warehouse facilities under operating leases, some of which include cost escalation clauses, expiring on various dates through 2014. Total rental expense charged to operations was $54 million in 1994, $42 million in 1993, and $44 million in 1992. At December 31, 1994, the minimum future rental commitments under noncancellable leases payable over the remaining lives of the leases are:
The minimum future rental commitments reflected in the above table include approximately $4 million per year for the lease of the Company's corporate headquarters facility in Toledo, Ohio through 1996. The Company is currently negotiating the lease of a new headquarters facility which would result in an operating lease beginning in late 1996, which is not reflected above. This operating lease would result in future rental commitments of approximately $12 million per year through 2006, $8 million per year through 2015, and, upon renewal, $2 million per year through 2020.
OWENS-CORNING FIBERGLAS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
17. Stock Compensation Plans
The Company's Stock Performance Incentive Plan (SPIP), approved by shareholders in 1992, permits up to two percent of common shares outstanding at the beginning of each calendar year to be awarded as stock options and restricted stock (with 25% of this amount as the maximum permitted number of restricted stock awards). The Company may carry forward unused shares from prior years and may increase the shares available for awards in any calendar year through an advance of up to 25% of the subsequent year's allocation (determined by using 25% of the current year's allocation). These shares are also subject to the 25% limit for restricted stock awards. During 1994, the total number of shares available for stock awards was 953,450 shares, 894,000 of which were awarded as stock options and 59,450 as restricted stock, which includes an advance of 93,478 shares from the 1995 allocation. 598,678 shares are also available to be awarded under a prior plan; however, the Company does not expect any awards to be made under that plan. Additionally, the Company has a plan to award stock options and deferred stock awards to nonemployee directors, of which 109,500 shares were available for this purpose as of December 31, 1994.
During 1993, the total number of shares available for stock awards was 868,215 shares, 813,900 of which were awarded as stock options and 54,315 as restricted stock, which included an advance of 3,149 shares from the 1994 allocation.
Option prices represent the market price at date of grant. Shares issued under options are recorded in the common stock accounts at the option price. Options granted vest ratably through 1997.
OWENS-CORNING FIBERGLAS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
17. Stock Compensation Plans (Continued)
Deferred Stock Awards
At December 31, 1994, the Company had 16,340 shares of deferred stock outstanding, all of which were vested. During 1994, 2,000 shares of deferred stock were granted, and 16,893 shares were issued.
Compensation expense is measured based on the market price of the stock at date of grant and is recognized on a straight-line basis over the vesting period.
Restricted Stock Awards
At December 31, 1994, the Company had 367,282 shares of restricted stock outstanding. Stock restrictions lapse, subject to alternate vesting plans for approved early retirement and involuntary termination, over various periods ending in 2004.
18. Share Purchase Rights
Each outstanding share of the Company's common stock includes a preferred share purchase right. Each right entitles the holder to buy from the Company one one-hundredth of a share of Series A Participating Preferred Stock of the Company at a price of $50. The Board of Directors has designated 750,000 shares of the Company's authorized preferred stock as Series A Participating Preferred Stock. There are currently no preferred shares outstanding.
Rights become exercisable and detach from the common stock ten days after a person or group acquires, or announces a tender offer for, 20% or more of the Company's outstanding shares of common stock. The rights expire on December 30, 1996, unless redeemed earlier by the Company. The rights are redeemable by the Company at one cent each at any time prior to ten days following public announcement or notice to the Company that an acquiring person or group has purchased 20% or more of the Company's outstanding common stock. If the Company is acquired in a merger or other business combination at any time after the rights become exercisable, each right would entitle its holder to buy shares of the acquiring or surviving company having a market value of twice the exercise price of the right.
OWENS-CORNING FIBERGLAS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
19. Derivative Financial Instruments and Fair Value of Financial Instruments
The Company is a party to financial instruments with off-balance-sheet risk in the normal course of business to help meet financing needs and to reduce exposure to fluctuating foreign currency exchange rates and interest rates. The Company is exposed to credit loss in the event of nonperformance by the other parties to the financial instruments described below. However, the Company does not anticipate nonperformance by the other parties. The Company does not engage in trading activities with these financial instruments and does not generally require collateral or other security to support these financial instruments. The notional amounts of derivatives summarized in the foreign exchange risk and interest rate risk management section below do not represent the amounts exchanged by the parties and, thus, are not a measure of the exposure of the Company through its use of derivatives. The amounts exchanged are calculated on the basis of the notional amounts and the other terms of the derivatives, which relate to interest rates, exchange rates, securities prices, or financial or other indexes.
Foreign Exchange Risk and Interest Rate Risk Management
The Company enters into various types of contracts to manage its foreign exchange risk and interest rate risk, as indicated in the following table.
Case filing rates continued at historically high levels in 1994 (approximately 27,500 new claims) following receipt of 31,700 claims in 1993 and 26,600 claims in 1992. Many of these new claims appear to be the product of mass screening programs and not to involve significant asbestos- related impairment. The large number of recent filings and the uncertain value of these claims have added to the uncertainties involved in estimating the Company's asbestos Liabilities.
OWENS-CORNING FIBERGLAS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
21. Contingent Liabilities (Continued)
The Company cautions that such factors as the number of future asbestos personal injury claims received by it, the rate of receipt of such claims, and the indemnity and defense costs associated with asbestos personal injury claims, as well as the prospects for confirming additional, applicable insurance coverage beyond the $341 million referenced above, are influenced by numerous variables that are difficult to predict, and that estimates, such as the Company's, which attempt to take account of such variables, are subject to considerable uncertainty. Depending upon the outcome of the various uncertainties described above, particularly as they relate to unimpaired claims, it may be necessary at some point in the future for the Company to make additional provision for the uninsured costs of asbestos personal injury claims received through the year 1999 (although no such amounts are reasonably estimable at this time). The Company remains confident that its estimate of Liabilities and Insurance will be sufficient to provide for the costs of all such claims that involve malignancies or significant asbestos-related functional impairment. The Company has reviewed and will continue to review the adequacy of its estimate of Liabilities and Insurance on a periodic basis and make such adjustments as may be appropriate.
The Company cannot estimate and is not providing for the cost of unasserted claims which may be received by the Company after the year 1999 because management is unable to predict the number of claims to be received after 1999, the severity of disease which may be involved and other factors which would affect the cost of such claims.
Cash Expenditures
The Company's anticipated cash expenditures for uninsured asbestos-related costs of claims received through 1999 are expected to approximate $764 million, the Company's Liabilities, net of Insurance. Cash payments will vary annually depending upon a number of factors, including the pace of the Company's resolution of claims and the timing of payment of its Insurance.
Management Opinion
Although any opinion is necessarily judgmental and must be based on information now known to the Company, in the opinion of management, the additional uninsured and unreserved costs which may arise out of pending personal injury and property damage asbestos claims and additional similar asbestos claims filed in the future will not have a materially adverse effect on the Company's financial position. While such additional uninsured and unreserved costs incurred in and after the year 2000 may be substantial over time, management believes that any such additional costs will not impair the ability of the Company to meet its obligations, to reinvest in its businesses or to take advantage of attractive opportunities for growth.
OWENS-CORNING FIBERGLAS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
21. Contingent Liabilities (Continued)
NON-ASBESTOS LIABILITIES
In October 1991, the Company and certain of its officers and directors were named as defendants in a lawsuit captioned Gaetana Lavalle v. Owens-Corning Fiberglas Corporation, et al. in the United States District Court for the Northern District of Ohio. Lavalle purports to be a securities class action on behalf of all purchasers of the Company's common stock during the period November 1, 1988 through October 18, 1991. The complaint alleges that the Company's disclosures during the alleged class period contained material misstatements and omissions concerning its contingent liabilities for asbestos claims. The complaint seeks an unspecified amount of damages (including punitive damages) on the theory that such alleged misstatements and omissions artificially inflated the price of the Company's stock. Various other lawsuits and claims arising in the normal course of business are pending against the Company, some of which allege substantial damages. Management believes that the outcome of these lawsuits and claims will not have a materially adverse effect on the Company's financial position or results of operations.
OWENS-CORNING FIBERGLAS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
22. Quarterly Financial Information (Unaudited)
Quarter First Second Third Fourth (In millions of dollars, except share data)
Net sales $ 677 $ 852 $ 936 $ 886
Cost of sales 523 644 705 664 ------- ------- ------- ------- Gross margin $ 154 $ 208 $ 231 $ 222 ======= ======= ======= ======= Income (loss) before cumulative effect of accounting changes $ (67) $ 45 $ 53 $ 43
Cumulative effect of accounting changes (Notes 6 and 7) 85 - - - ------- ------- ------- ------- Net income $ 18 $ 45 $ 53 $ 43 ======= ======= ======= ======= Net income per share:
Primary Income (loss) before cumulative effect of accounting changes $ (1.52) $ 1.03 $ 1.19 $ .98
Cumulative effect of accounting changes 1.93 - - - ------- ------- ------- ------- Net income per share $ .41 $ 1.03 $ 1.19 $ .98 ======= ======= ======= ======= Fully diluted Income (loss) before cumulative effect of accounting changes $ (1.30) $ .95 $ 1.09 $ .91
Cumulative effect of accounting changes 1.70 - - - ------- ------- ------- ------- Net income per share $ .40 $ .95 $ 1.09 $ .91 ======= ======= ======= =======
OWENS-CORNING FIBERGLAS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
22. Quarterly Financial Information (Unaudited) (Continued)
Quarter First Second Third Fourth (In millions of dollars, except share data)
Net sales $ 651 $ 754 $ 785 $ 754
Cost of sales 512 578 606 570 ------- ------- ------- ------- Gross margin $ 139 $ 176 $ 179 $ 184 ======= ======= ======= ======= Income (loss) before cumulative effect of accounting change $ (9) $ 33 $ 48 $ 33
Cumulative effect of accounting change for income taxes (Note 9) 26 - - - ------- ------- ------- ------- Net income $ 17 $ 33 $ 48 $ 33 ======= ======= ======= ======= Net income per share:
Primary Income (loss) before cumulative effect of accounting change $ (.20) $ .76 $ 1.09 $ .75
Cumulative effect of accounting change for income taxes .60 - - - ------- ------- ------- ------- Net income per share $ .40 $ .76 $ 1.09 $ .75 ======= ======= ======= ======= Fully diluted Income (loss) before cumulative effect of accounting change $ (.13) $ .71 $ 1.01 $ .70
Cumulative effect of accounting change for income taxes .53 - - - ------- ------- ------- ------- Net income per share $ .40 $ .71 $ 1.01 $ .70 ======= ======= ======= =======
Net income per share and primary and fully diluted weighted average shares are computed independently for each of the quarters presented. Therefore, the sum of the quarterly net income per share may not equal the per share total for the year.
INDEX TO FINANCIAL STATEMENT SCHEDULES
Number Description Page
II Valuation and Qualifying Accounts and Reserves - for the years ended December 31, 1994, 1993 and 1992. . . . .73
OWENS-CORNING FIBERGLAS CORPORATION AND SUBSIDIARIES
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
AS OF DECEMBER 31, 1994, 1993 AND 1992
Column A Column B Column C Column D Column E
Additions (1) (2) Balance at Charged to Charged to Balance Beginning Costs and Other at End Classification of Period Expenses Accounts Deductions of Period (In millions of dollars)
FOR THE YEAR ENDED DECEMBER 31, 1994: Allowance deducted from asset to which it applies - Doubtful Accounts $ 16 $ 5 $ - $ 5(A) $ 16 Shown separately - Rebuilding furnaces 124 - - 124(C) -
FOR THE YEAR ENDED DECEMBER 31, 1993: Allowance deducted from asset to which it applies - Doubtful Accounts $ 20 $ 1 $ - $ 5(A) $ 16 Shown separately - Rebuilding furnaces 124 17 - 17(B) 124
FOR THE YEAR ENDED DECEMBER 31, 1992: Allowance deducted from asset to which it applies - Doubtful Accounts $ 18 $ 11 $ - $ 9(A) $ 20 Shown separately - Rebuilding furnaces 113 27 - 16(B) 124
Notes: (A) Uncollectible accounts written off, net of recoveries.
(B) Expenditures for purposes for which reserve was created.
(C) Effective January 1, 1994, the Company adopted the capital method for rebuilding furnaces. See Note 6 to the Consolidated Financial Statements. /TABLE
EXHIBIT INDEX
Exhibit Number Document Description
(3) Articles of Incorporation and By-Laws.
Certificate of Incorporation of Owens-Corning Fiberglas Corporation, as amended (incorporated herein by reference to Exhibit (3) to the Company's annual report on Form 10-K for 1986).
By-Laws of Owens-Corning Fiberglas Corporation, as amended (incorporated herein by reference to Exhibit (19) to the Company's quarterly report on Form 10-Q for the quarter ended March 31, 1988).
(4) Instruments Defining the Rights of Security Holders, Including Indentures.
Credit Agreement, dated as of November 2, 1993, among Owens-Corning Fiberglas Corporation, the Banks listed on Annex A thereto, and Credit Suisse, as Agent for the Banks (incorporated herein by reference to Exhibit (4) to the Company's quarterly report on Form 10-Q for the quarter ended September 30, 1993), as amended by Amendment No. 1 thereto (incorporated herein by reference to Exhibit (10) to the Company's quarterly report on Form 10-Q for the quarter ended June 30, 1994).
The Company agrees to furnish to the Securities and Exchange Commission, upon request, copies of all instruments defining the rights of holders of long-term debt of the Company where the total amount of securities authorized under each issue does not exceed ten percent of the Company's total assets.
(10) Material Contracts.
Credit Agreement, dated as of November 2, 1993, among Owens-Corning Fiberglas Corporation, the Banks listed on Annex A thereto, and Credit Suisse, as Agent for the Banks (incorporated herein by reference to Exhibit (4) to the Company's quarterly report on Form 10-Q for the quarter ended September 30, 1993), as amended by Amendment No. 1 thereto (incorporated herein by reference to Exhibit (10) to the Company's quarterly report on Form 10-Q for the quarter ended June 30, 1994).
Rights Agreement, dated as of December 18, 1986, between Owens-Corning Fiberglas Corporation and Manufacturers Hanover Trust Company, as Rights Agent, including, as Exhibit B of such Rights Agreement, the form of Right Certificate (incorporated herein by reference to Exhibits 1 and 2 to the Company's Registration Statement on Form 8- A, dated December 23, 1986).
EXHIBIT INDEX
Exhibit Number Document Description
* 1995 Corporate Incentive Plan - General Terms (filed herewith).
* Agreement, dated as of January 1, 1995, with William W. Colville (filed herewith).
* Agreement, dated June 16, 1993, with David W. Devonshire (filed herewith).
* Owens-Corning Fiberglas Corporation Director's Charitable Award Program (incorporated herein by reference to Exhibit (10) to the Company's quarterly report on Form 10-Q for the quarter ended September 30, 1993).
* Owens-Corning Fiberglas Corporation Executive Supplemental Benefit Plan, as amended (incorporated herein by reference to Exhibit (10) to the Company's quarterly report on Form 10-Q for the quarter ended March 31, 1993).
* Employment Agreement, dated as of December 15, 1991, with Glen H. Hiner (incorporated herein by reference to Exhibit (10) to the Company's annual report on Form 10-K for 1991), as amended by First Amending Agreement made as of April 1, 1992 (incorporated herein by reference to Exhibit (19) to the Company's quarterly report on Form 10-Q for the quarter ended June 30, 1992).
* Owens-Corning Fiberglas Corporation Stock Performance Incentive Plan (incorporated herein by reference to Exhibit (19) to the Company's quarterly report on Form 10-Q for the quarter ended June 30, 1992).
* Owens-Corning Fiberglas Corporation 1987 Stock Plan for Directors, as amended (incorporated herein by reference to Exhibit (19) to the Company's quarterly report on Form 10-Q for the quarter ended March 31, 1992).
* Form of Key Management Severance Benefits Agreement (incorporated herein by reference to Exhibit (10) to the Company's annual report on Form 10-K for 1991).
* Agreement, dated September 27, 1990, with William W. Boeschenstein (incorporated herein by reference to Exhibit (10) to the Company's annual report on Form 10-K for 1990).
EXHIBIT INDEX
Exhibit Number Document Description
* Owens-Corning Fiberglas Corporation 1986 Equity Partnership Plan, as amended (incorporated herein by reference to Exhibit (19) to the Company's quarterly report on Form 10-Q for the quarter ended March 31, 1988), as amended by Amendment 1 thereto (incorporated herein by reference to Exhibit (19) to the Company's quarterly report on Form 10-Q for the quarter ended March 31, 1989), by Amendment 2 thereto (incorporated herein by reference to Exhibit (10) to the Company's annual report on Form 10-K for 1989) and by Amendment 3 thereto (incorporated herein by reference to Exhibit (10) to the Company's annual report on Form 10-K for 1990).
The following documents are incorporated herein by reference to Exhibit (10) to the Company's annual report on Form 10-K for 1989:
* - Pension Agreement, dated April 16, 1984, with William W. Colville.
* - Form of Directors' Indemnification Agreement.
The following documents are incorporated herein by reference to Exhibit (10) to the Company's annual report on Form 10-K for 1987:
* - Owens-Corning Fiberglas Corporation Officers Deferred Compensation Plan.
* - Owens-Corning Fiberglas Corporation Deferred Compensation Plan for Directors, as amended.
(11) Statement re Computation of Per Share Earnings (filed herewith).
(21) Subsidiaries of Owens-Corning Fiberglas Corporation (filed herewith).
(23) Consent of Arthur Andersen LLP (filed herewith).
(27) Financial Data Schedule (filed herewith).
* Denotes management contract or compensatory plan or arrangement required to be filed as an exhibit pursuant to Item 14(c) of Form 10-K.