ITEM 1. BUSINESS
INTRODUCTION
Manville Corporation, an international holding company with two principal operating subsidiaries, Riverwood International Corporation ("Riverwood") and Schuller International, Inc. ("Schuller"), was incorporated in Delaware in 1981 to continue businesses begun by its predecessors in 1858. The Company owns or operates 62 facilities in the United States and eight other countries, approximately 540,000 acres of timberland in the United States and 174,000 acres in Brazil, and one mine.
Riverwood is an international packaging and paper products company of which Manville owns approximately 81.5% of the outstanding capital stock. The operations of Riverwood and its affiliated companies are organized into three business segments: Coated Board System, Containerboard and U.S. Timberlands/Wood Products.
Schuller constitutes the Company's fiberglass-based business and includes both the Building Products and Engineered Products business segments. Subsegments comprising the Building Products business segment include building insulation, roofing systems and mechanical insulations. The Engineered Products business segment includes Schuller GmbH, a German subsidiary, and the mats & reinforcements and equipment insulations and filtration products subsegments. Schuller is a wholly-owned subsidiary of Manville.
In addition to the foregoing, Manville holds an equity interest in platinum and palladium mining operations located in Montana.
SIGNIFICANT DEVELOPMENTS
On November 19, 1990, the Company and the Manville Personal Injury Settlement Trust (the "PI Trust") entered into formal agreements with respect to an arrangement (the "Refinancing Arrangement") which, if consummated, would have enhanced the PI Trust's liquidity. Also on November 19, 1990, five asbestos plaintiffs filed a limited fund class action lawsuit (the "Class Action") against the Trustees of the PI Trust in the United States District Courts for the Eastern and Southern Districts of New York (the "Courts"). The Class Action was filed on behalf of all beneficiaries of the PI Trust and seeks to restructure the methods by which the PI Trust administers and pays claims. The Company is not a party to the Class Action. On November 26, 1990, the Company filed a separate motion asking the Courts and the United States Bankruptcy Court for the Southern District of New York (the "Bankruptcy Court") to issue orders reaffirming the Injunction issued in connection with the Company's Plan of Reorganization (the "Plan"). The Injunction prohibits any suits against the Company and its subsidiaries for any asbestos-related claim. The Injunction requires that all such claims be made against and administered by the PI Trust or the Manville Property Damage Settlement Trust (the "PD Trust"). Certain provisions of the Refinancing Arrangement were subject to numerous approvals and conditions, including, among other things, a final order approving the Restructuring Settlement.
The Courts and the Bankruptcy Court entered an order in May 1991, as modified in July 1991 (the "Order"), which, among other things, reaffirmed the Injunction (the "Reaffirmation Order") and approved the settlement of the Class Action (the "Restructuring Settlement"). Thirteen appeals of the Order were filed. The Reaffirmation Order was not challenged in the lower court or on appeal. On February 24, 1992, the Court of Appeals for the Second Circuit (the "Second Circuit") heard the various appeals of the Order.
On December 4, 1992, the Second Circuit vacated and remanded the Order for further proceedings. The Second Circuit found, among other reasons for remanding the Restructuring Settlement, that the representatives of the class may not have fairly represented the interests of all persons who were made part of the Class Action. The decision of the Second Circuit, as subsequently modified, has become final. As a result, various aspects of the Refinancing Arrangement have terminated. Attempts by the parties to the Class Action to reach a new settlement are continuing. One day of trial of the Class Action was held on March 15, 1994, and in the absence of a settlement, the trial will resume following a conference before the Courts currently scheduled for April 18, 1994.
On August 25, 1993, Manville and the PI Trust entered into a Bond Prepayment Agreement (the "Agreement") pursuant to which Manville made a partial prepayment of certain of its obligations to the PI Trust under the bonds issued to the PI Trust. The partial prepayment consisted of a cash payment of approximately $150 million and an assignment to the PI Trust of $100 million principal amount of Riverwood's currently outstanding notes held by Manville (the "Notes"), plus accrued interest. Under the terms of the Agreement, the PI Trust was granted certain registration rights with respect to the Notes pursuant to which Riverwood registered the Notes under the Securities Act of 1933, as amended (the "Act"). On October 14, 1993, the PI Trust completed a public secondary sale of the Notes. Neither the Company nor Riverwood received any proceeds from the public offering by the PI Trust.
Further information concerning the Refinancing Arrangement, the Company's Chapter 11 proceedings consummated in 1988, and related matters, is found in Notes 2 and 4 to Consolidated Financial Statements of the Company's 1993 Annual Report and in this Form 10-K under ITEM 3, LEGAL PROCEEDINGS - Plan of Reorganization and Related Injunction.
On September 17, 1993, Riverwood completed a private placement of $125 million aggregate principal amount of its 6 3/4% Convertible Subordinated Notes due 2003 (the "Convertible Notes") in transactions exempt from registration under the Act (the "Private Placement"). On November 5, 1993, Riverwood filed a registration statement with respect to the Convertible Notes and the common stock into which the Convertible Notes may be converted. Neither Riverwood nor the Company will receive any proceeds from any sales of the Convertible Notes or such common stock pursuant to the registration statement.
Concurrent with the completion of the Private Placement on September 17, 1993, Manville purchased 3,448,276 shares of Riverwood's common stock at a price of $14.50 per share, for an aggregate investment of approximately $50 million. Manville now owns approximately 81.5% of Riverwood's outstanding common stock.
On January 16, 1994, Schuller completed the exchange of its North American residential roofing business for the North American commercial and industrial roofing businesses of Owens-Corning Fiberglas Corp. ("O-C"). As a result of the exchange, Schuller acquired O-C's commercial and industrial roofing plant in Oklahoma City, Oklahoma, and O-C's modified bitumen equipment located in Canada. Schuller will produce Perma Ply-R(R) at its Oklahoma City plant and will market fiberglass roof insulation produced by O-C in Kansas City, Kansas. O-C has acquired Schuller's residential roofing plant facility in Savannah, Georgia and its residential roofing equipment in Waukegan, Illinois.
On September 15, 1993, Riverwood Energy Resources, Inc., a wholly-owned subsidiary of Manville ("RERI"), completed its sale of all rights, titles and interests in the Petit Zone Unit, Black Lake Field, located in Natchitoches and Winn Parishes, Louisiana, and all facilities related to the Black Lake - Olla Carbon Dioxide Pipeline.
MAJOR BUSINESS SEGMENTS
The Company is currently divided into five separate business segments reflecting the Company's major product groups. Financial information on the business segments, including information based on geographic areas, may be found in the Company's 1993 Annual Report. Property descriptions for each business segment may be found under ITEM 2, PROPERTIES.
RIVERWOOD INTERNATIONAL CORPORATION
OPERATING UNITS
Riverwood consists of three of the Company's business segments: Coated Board System, Containerboard and U.S. Timberlands/Wood Products. The Coated Board System segment includes the production of coated unbleached kraft paperboard ("CUK Board") on three paper machines at Riverwood's West Monroe, Louisiana mill and a recycled paperboard mill in Sweden, beverage and folding carton converting facilities in Australia, Brazil, Europe, the U.K. and the U.S., Riverwood's worldwide packaging machinery operations, and its joint venture operations in Denmark and Japan. In July 1992, in order to increase its U.S. paperboard production capacity, Riverwood purchased substantially all of the assets of Macon Kraft, Inc. (the "Macon Mill"), a manufacturer of linerboard for corrugated box applications located in Macon, Georgia. At the end of 1992, Riverwood began to supplement its production of CUK Board grades through the process of producing a small amount of base stock at the Macon Mill and coating it off-line in West Monroe, Louisiana. The Containerboard segment includes linerboard, bag kraft and corrugating medium produced at two mills in the U.S., linerboard and corrugating medium produced at two mills in Brazil, three corrugated box plants in Brazil and approximately 174,000 acres of owned and leased timberlands in Brazil, used exclusively for wood chip and energy requirements of the paper mills. The U.S. Timberlands/Wood Products business segment includes two U.S. lumber mills, a U.S. plywood plant and approximately 540,000 acres of owned and leased timberland in Arkansas, Louisiana and Texas.
COATED BOARD SYSTEM
The principal products of the Coated Board System segment are:
Beverage Cartons Coated Recycled Paperboard Coated Unbleached Kraft Paperboard, Folding Cartons including Carrierboard, Cartonboard Packaging Machinery and Pre-Print Linerboard
Riverwood's Coated Board System segment consists of the manufacture and sale of CUK Board to its own divisions and external customers, the conversion of CUK Board to beverage and folding cartons, and the design and assembly of proprietary packaging machinery. Of Riverwood's three business segments, the Coated Board System segment accounted for approximately 65% of Riverwood's net sales (excluding intersegment sales) and 75% of Riverwood's income from operations (excluding corporate expenses) in 1993.
Riverwood's Coated Board System strategy is to provide its customers with a system-based packaging solution responsive to their packaging, distribution and promotional needs, and to expand its position as a leader in CUK Board- based paperboard packaging by: (i) continuing to focus on serving the packaging needs of multinational beverage and consumer products companies; (ii) further developing Riverwood's international operations where it believes growth opportunities are greatest; and (iii) increasing Riverwood's placement of its proprietary packaging machinery with its customers. As part of the implementation of such strategy, Riverwood has pursued an expansion program that has included the acquisition of the Macon Mill, a paperboard facility in Sweden and converting and/or packaging machinery operations in Australia, Brazil, Europe and the U.S.
CUK Board is a specialized grade of paperboard representing approximately 4% of total U.S. paperboard tonnage. The primary end uses of CUK Board are as beverage cartons ("carrierboard") for beer and soft drink handling and as folding cartons ("cartonboard") for confectionery, frozen food, dry goods and other consumer products. CUK Board is well-suited as secondary packaging for the beverage and consumer product industries due to its strength, moisture resistance and stiffness. The board surface is desirable for high-quality printing, allowing manufacturers to add high impact logos, pictures and promotional elements to their packages. In addition, the production of CUK Board does not require a bleaching process, thereby eliminating environmental concerns arising in connection with chlorine bleached products.
The conversion of CUK Board into packaging products begins with rolls of CUK Board which are then cut and printed to customer specifications on multi-color printing presses. In the case of CUK Board used to manufacture a majority of Riverwood's beverage carton products, the CUK Board rolls are fed into printing presses which, in one integrated process, print and cut the CUK Board into beverage cartons to customer specifications. The printed cartons are then shipped to customers' plants where they are placed in packaging machines. The packaging machines then erect the beverage cartons, insert the customers' products and close or seal the package.
Three trends which have developed over the past decade have increased the demand in the U.S. for beverage carrierboard. First, cans have become a preferred form of primary beverage container packaging due to their ease of transportation, handling and storage. Second, CUK Board has emerged as the preferred form of secondary packaging for cans and bottles as a result of an increase in the size of container multipacks, such as 6-packs growing to 12- packs, 24-packs and even 36-can units. Finally, the use of CUK Board has increased because of the importance of secondary packaging for marketing and promotional purposes. As a result of its physical and promotional attributes, the CUK Board product used by the beverage industry has been a relatively high growth segment of the U.S. paperboard industry over the last decade.
Riverwood believes that the three trends described above are beginning to develop in Europe, as cans gain wider consumer acceptance, and in Japan, albeit at a slower pace. Riverwood believes that its acquisitions in Europe, its joint venture with the Rengo Company Limited ("Rengo") in Japan and its joint venture with Danapak Holding A/S ("Danapak") in Denmark position Riverwood to benefit from the increasing international usage of carrierboard.
In July 1992, Riverwood acquired the Macon Mill as part of its efforts to increase its U.S. paperboard production capacity. Riverwood is in the process of converting one of the Macon Mill's linerboard machines to CUK Board production. Riverwood believes that the conversion of one of the two linerboard machines at the Macon Mill is on schedule and on budget. Riverwood has improved the quality of the paperboard produced, as well as the efficiency and level of safety at the Macon Mill since its acquisition.
At the end of 1992, Riverwood began to supplement its production of CUK Board grades through the process of producing a small amount of base stock at the Macon Mill and coating it off-line in West Monroe, Louisiana. The final conversion of one of the Macon Mill's linerboard machines is scheduled for the second half of 1994. Riverwood's plan is to retrofit the linerboard machine at the Macon Mill with a new coating section during the first half of 1994 for the production of some CUK Board in time for the 1994 beverage season. The machine is anticipated to be fully converted by the end of 1994. Riverwood will then have the flexibility to produce coated beverage carrierboard, folding cartonboard and linerboard on the new three-ply machine. Efficient start-up and production of saleable CUK Board is dependent upon many manufacturing process and engineering factors. During the final phase of conversion, the linerboard machine will be shut down to complete final construction. While Riverwood believes the final phase of the conversion will be completed within a reasonable shut-down period, there can be no assurance that a longer-than-anticipated delay will not be experienced before saleable CUK Board is produced, during which time Riverwood will continue to rely on a single U.S. CUK Board production facility and, therefore, will experience delay in the realization of benefits of full conversion. As originally anticipated, Riverwood continues to estimate that it will take several years of marketing development activities to redirect the full capacity of the converted machine to the beverage carton market. Pending such redirection, excess capacity will be directed into the general folding carton and linerboard markets. The Company believes that it will be able to sell the additional CUK Board output at satisfactory prices. There can be no assurance, however, that the additional output can be sold at current market prices.
During 1993, Riverwood continued its development of proprietary packaging machines with the development and introduction of four new paperboard packaging systems -- Quikflex(TM), Twin-Stack(TM), Eclipse(TM) and Light-Tite(TM)--to the beverage industry. These systems combine innovative package design with high-speed, reliable packaging machinery. Riverwood believes that the range of packaging systems it offers to its beverage customers is among the broadest available in the industry.
The Twin-Stack system can insert 12, 18, 24, 30 or 36 cans in two tiers or 9, 12, 15 or 18 cans in a single tier. Can stacking creates a defined package top and bottom with large side and end billboards for maximum point-of-sale impact. The double-stacked design for larger multipacks is compact and easy to carry, and Twin-Stack machines can combine two brands -- such as diet and regular -- in a "variety pack" with a paperboard divider pad that can be printed for use in promotions. The beverage industry's interest in the Twin- Stack packaging system
has been favorable. While targeted primarily at the U.S. beverage market, Riverwood has orders or made installations on four continents.
Riverwood principally markets CUK Board-based packaging products to large multinational brewers, soft drink bottlers and food companies which use printed packaging for retail display, multiple packaging and shipment of their products. Although the beverage carton segment of the paperboard packaging market is an important focus, Riverwood's CUK Board, sold directly to customers and through third party converters, has also found specific applications in the folding carton segment such as frozen and dry food, toy and hardware packaging. Major customers for Riverwood's CUK Board in the folding carton segment of the paperboard packaging market include M&M Mars (a division of Mars, Inc.), Sara Lee Corporation and Unilever N.V. By working directly with customers to develop new packaging applications and integrated solutions, Riverwood is attempting to further penetrate this market.
U.S. Operations. Riverwood's U.S. CUK Board is produced at its West Monroe, Louisiana mill, which produced approximately 645,000 tons of CUK Board during 1993. Riverwood markets CUK Board under the names Aquakote(R) (carrierboard), Pearlkote(R) (cartonboard) and Krafbrite(R) (pre-print linerboard). In addition to Riverwood's 100% recycled capabilities in Europe described below, Riverwood has increased its U.S. capacity to produce products with recycled fiber. Riverwood has spent approximately $11 million to expand the recycling capacity at the West Monroe facility. The expansion allows Riverwood to increase the post-consumer recycled content of Aquakote(R) carrierboard to 20%. The Macon Mill has the capability of producing certain products with a recycled content of up to 50%.
In 1993, approximately 39% of Riverwood's overall U.S. CUK Board shipped by its West Monroe, Louisiana mill was used by Riverwood's U.S. converting operations, 48% was sold to other U.S. converters and the balance was sold to international converters, including Riverwood's overseas subsidiaries. Riverwood owns beverage carton plants in Bakersfield, California; West Monroe, Louisiana; Clinton, Mississippi; and Cincinnati, Ohio. Riverwood owns a folding carton plant in Kankakee, Illinois. Riverwood also has a supply arrangement with an unaffiliated beverage carton plant in Lansdowne, Pennsylvania used to service the Northeast.
Worldwide Packaging Machinery. Riverwood's packaging design and packaging machinery design, manufacturing and administrative sites are located near Smithfield, New South Wales, Australia; Sao Paulo, Brazil; Atlanta, Georgia; Koln, Germany; West Monroe, Louisiana; Crosby, Minnesota; Saddlebrook, New Jersey; Barcelona, Spain; and Bristol, United Kingdom. Riverwood has a substantial number of proprietary packaging machines installed at customer production sites worldwide. Riverwood leases substantially all of its packaging machinery to its customers. The machines are designed to efficiently process the CUK Board produced and converted by Riverwood. In March 1991, Riverwood acquired from Federal Paper Board Company the machinery portfolio and related patents, trademarks and trade names known as Jak-et- Pak(R). The machinery portfolio consisted of machines located in Australia, Europe, Japan and North America. In September 1991, Riverwood acquired Minnesota Automation, Inc., a designer and producer of high-speed packaging machinery and equipment. In August 1992, Riverwood opened the Product Development Center near Atlanta, Georgia, where worldwide packaging solutions, including machinery design, packaging concepts and related packaging systems, are being developed, tested and manufactured. The Product Development Center coordinates worldwide integration of the machinery and carton development. Riverwood has an aggressive program of protecting new machinery and packages by appropriate patents and trademarks filed throughout the world.
In 1992, Riverwood opened a facility in Koln, Germany, for the purpose of developing products offering engineering solutions for European customers. At this facility, Riverwood designs and develops packaging and related packaging machines and assembles these machines for shipment to CUK Board customers.
International Operations. Riverwood's international Coated Board System segment includes a mill in Sweden, seven converting plants located in Europe and Australia, and 19 sales offices located in 14 countries, excluding the U.S. All international coated board production facilities have been acquired or formed by Riverwood since 1990 in a program aimed at expanding Riverwood's role in the packaging industry in international markets.
Riverwood expanded its base of paperboard production with its June 1990 acquisition of Fiskeby Board AB. The 105,000 metric tons per year mill located in Norrkoping, Sweden produces 100% recycled coated paperboard, enabling Riverwood to serve the growing needs of its customer base that requires recycled packaging.
Riverwood developed its international folding carton converting base through the acquisition of DRG Cartons (now known as Riverwood International Limited ("RIL")), Visypack Pty. Ltd., (now known as Multiboard Packaging Pty. Ltd. ("Multiboard")) and Jorba, S.A. ("Jorba"). These operations provide Riverwood with local converting capacity to serve Australasian, continental European and U.K. markets. RIL is a major beverage and folding carton converter in the U.K. and manufactures cartons primarily for the beverage, frozen food, confectionery and detergent markets. Multiboard has five plants in eastern Australia manufacturing cartons for the food, consumer products and beverage industries. Riverwood Packaging Systems Pty. Ltd., a wholly-owned subsidiary of Riverwood, acquired the assets of Multiboard's packaging machinery division in December 1992. Jorba is a beverage and folding carton packaging supplier in Spain. These facilities provide outlets for paperboard tonnage from the West Monroe and Norrkoping operations.
In 1991, Riverwood acquired two additional packaging machinery operations. In August, it acquired Syspack, S.A., located in Spain, to complement its European converting operations. Syspack, S.A. was merged with Jorba, effective July 29, 1993. In December, Igaras Papeis e Embalagens Ltda. ("Igaras"), Riverwood's integrated Brazilian paperboard subsidiary, acquired the assets of M.E.A.D. Ltda., a packaging machinery company, which competes in the South American multiple packaging markets. Machine placements in Brazil are currently supported by Riverwood's U.S. CUK Board and converting facilities and its worldwide packaging machinery operations.
Riverwood has also formed joint venture arrangements with Rengo to market machinery-based packaging systems in Japan. The joint venture arrangements cover paperboard supply and marketing and distribution of packaging systems. Eventually the arrangements will also cover carton converting. In addition, in December 1993, Riverwood entered into a joint venture with Danapak for the purpose of marketing machinery-based packaging systems and cartons in Scandinavia.
Competition. CUK Board competes with recycled clay-coated newsprint ("CCN") board, solid bleached sulphate ("SBS") board and other box board in the folding carton segment of the paperboard packaging market. In the folding carton segment, cartonboard grades compete based on price and quality as measured by strength and printability. CUK Board has better tear strength characteristics than SBS and better tear strength and cross-direction stiffness than CCN. In terms of price and quality, CUK Board is positioned between CCN and SBS. Historically, CUK Board has been priced higher than CCN and lower than SBS. Recently, corrugated material has begun to make some inroads in the beverage carton segment of the paperboard packaging market. Riverwood's Krafbrite(R) product is one of several products used in this corrugated material.
Riverwood estimates that during 1993 it had approximately 50% of the U.S. carrierboard segment of the paperboard packaging market. In contrast, Riverwood estimates that it has approximately 3% of the folding carton segment of the U.S. paperboard packaging market. There are two major U.S. producers of CUK Board for beverage carton applications -- Riverwood and The Mead Corporation. There are a large number of producers of paperboard for folding carton applications.
CONTAINERBOARD
The principal products of the Containerboard segment are:
Corrugated Boxes Kraft Linerboard Corrugating Medium Kraft Paper
The Containerboard segment accounted for approximately 22% of Riverwood's net sales (excluding intersegment sales) and Riverwood had a $32 million loss from operations in 1993, which corresponds to a 24% loss from operations.
U.S. Operations. In the U.S., Riverwood is a producer of linerboard, corrugating medium and unbleached kraft paper which are commodity paperboard products. Corrugating medium, an unbleached paperboard, is combined with linerboard to make corrugated containers. Kraft paper is used primarily to make grocery bags and sacks. Riverwood has, on an annual basis, approximately 525,000 tons of linerboard capacity at the Macon Mill plus 142,000 tons of medium and 39,000 tons of bag kraft capacity at West Monroe, Louisiana. With 1993 sales of approximately 134,000 tons of medium, Riverwood represented approximately 2% of the U.S. corrugating medium market. With 1993 sales of 37,000 tons of bag kraft, Riverwood accounted for approximately 2% of the U.S. unbleached bag and sack kraft paper market. Riverwood had approximately 2% of the U.S. linerboard market in 1993.
The acquisition of the Macon Mill increased Riverwood's worldwide production of linerboard from 284,000 tons to 809,000 tons per year. The dedicated linerboard capacity will be reduced by approximately 275,000 tons after the conversion of one of the Macon Mill's two linerboard machines to CUK Board production is completed, which Riverwood anticipates will occur in 1994.
Brazilian Operations. Riverwood's principal international containerboard operations are conducted through Igaras, an integrated containerboard producer, which was acquired by Riverwood's predecessor companies in 1958. Igaras is Brazil's fourth largest paperboard company, operating two mills and three corrugated box plants and owning and leasing approximately 174,000 acres of timberlands. Igaras' Otacilio Costa mill operates three paper machines and has a production capacity of approximately 284,000 tons per year of kraft linerboard as well as small amounts of coated paper and kraft paper. Its Angatuba mill produces approximately 56,000 tons per year of corrugating medium on one machine. The timberlands are primarily pine plantations, supplying substantially all of the mills' softwood fiber requirements. Igaras also maintains eucalyptus plantations which are used as a source of energy for the mills.
Igaras' strategy is to focus primarily on the export markets where it had approximately 84% of its 1993 linerboard sales. Riverwood believes that Igaras' competitive strengths include its low fiber costs, which are primarily due to Brazil's accelerated tree growth cycle and planting patterns, and its relatively low labor costs. Brazil's accelerated tree growth cycle results in substantially higher timberland yields than similar U.S. southern pine timberlands.
The Brazilian currency has experienced devaluations following periods of overvaluation relative to other convertible currencies. Such devaluations and overvaluations may affect the financial condition and results of operations of Igaras. Brazil continues to experience high rates of inflation. In an attempt to control inflation, the Brazilian government, which has recently experienced political changes, has at times instituted policies, such as wage and price controls, which have at times adversely affected Igaras' operating results. Additionally, the Brazilian government has from time to time restricted the remittance of capital abroad. There can be no assurance that the Brazilian government will not institute similar policies or impose such restrictions again in the future.
Competition. The Containerboard segment operates within a highly fragmented industry structure. Many products within this industry are viewed as commodities and selling prices tend to be cyclical, rising during periods of strong economic activity and declining in periods of economic weakness. Over the past several years, worldwide prices for Containerboard have significantly declined based on weak economic activity, the strengthening of the U.S. dollar and the continued increase in industry capacity.
U.S. TIMBERLANDS/WOOD PRODUCTS
The U.S. Timberlands/Wood Products segment accounts for approximately 13% of Riverwood's net sales (excluding intersegment sales) and 49% of Riverwood's income from operations (excluding corporate expenses) in 1993.
Riverwood owns and leases approximately 540,000 acres of timberland in Arkansas, Louisiana and Texas. In December 1993, Riverwood completed the sale and assignment for cash, of approximately 60,000 acres of non-strategic timberlands located in Louisiana and Texas. In 1972, Riverwood initiated a forestry program to increase the yield from its U.S. southern pine forests. Riverwood expects to complete its transition from natural forests to pine plantations by approximately the year 2001. As Riverwood uses a greater recycled content in
its CUK Board, it will become less reliant on its timberland base. Riverwood's timberlands supplied approximately 42% of the wood fiber requirements for the West Monroe, Louisiana mill in 1993.
Riverwood has two sawmills and one plywood plant for manufacturing products from southern pine. Riverwood's lumber products include dimensional lumber and boards, while its plywood products include sheathing and specialty grades. The residual chips from these operations and pulpwood from the forest are shipped to the West Monroe paperboard mill for processing into paper and paperboard.
MARKETING AND DISTRIBUTION
Riverwood sells packaging, paperboard and wood products in both industrial and consumer markets. Distribution of board products is primarily accomplished through direct sales offices in Australia, Brazil, Canada, Denmark, France, Germany, Holland, Hong Kong, Italy, Japan, Singapore, Spain, Sweden, the U.K. and in several locations in the U.S. The Containerboard segment sells linerboard and corrugating medium through direct sales offices in Brazil and the U.S. Outside of Brazil and the U.S., linerboard is primarily distributed through independent sales representatives. Lumber and plywood products of the U.S. Timberlands/Wood Products segment are distributed by direct sales to retailers and wholesalers primarily in Southern and Central U.S. markets.
OCCUPATIONAL HEALTH AND SAFETY ASPECTS OF RIVERWOOD PRODUCTS
The manufacture of lumber, plywood, pulp, paperboard and paper products and their use may involve the generation of wood dust. Wood dust has been associated with health problems, primarily irritation or allergic reaction of the skin or lungs. European studies have also associated wood dust exposure with a rare form of nasal cancer in some industries. Although these studies showing a link to nasal cancer have primarily been conducted in industries using hard wood, exposure to soft wood is implicated as well. Two of the major industries in which the Company is involved -- paper products and wood products -- use predominantly soft wood.
On January 19, 1989, the Occupational Safety & Health Administration ("OSHA") published its final rule on Air Contaminants that lowered 212 of OSHA's existing permissible exposure limits ("PELs") for toxic substances and set PELs for 164 new substances which included wood dusts. On July 7, 1992, the Eleventh Circuit Court of Appeals issued a decision stating that the revised air contaminant standard was vacated, and that wood dusts would no longer have specific standards. Riverwood continues to list the more stringent PEL that was established in 1989 of 5 milligrams per cubic meter (mg/M/3/) for an 8- hour exposure, with a limit of 10 mg/M/3/ set for short term exposures not to exceed fifteen minutes for wood dust, all soft and hard woods, except western red cedar, on its material safety data sheets ("MSDS").
Modifications to the Hazard Communication Standard have been made and went into effect on March 11, 1994, that specifically address wood dust. OSHA is technically amending the rule to clarify that the wood dust is not generally a wood "product," and a MSDS and a label are required. It is the responsibility of the first employer who handles or processes the raw material in such a way that the hazardous chemical is "produced" and released into the work environment.
SCHULLER INTERNATIONAL, INC.
Schuller, and its affiliated companies, include two of the Company's business segments, Building Products and Engineered Products. The Building Products business segment manufactures and sells building and mechanical insulations and roofing systems from 19 manufacturing plants in the U.S. and Canada. The Engineered Products business segment manufactures and sells insulation, reinforcement and filtration products from ten manufacturing plants in the U.S. and three manufacturing plants in Germany.
BUILDING PRODUCTS
The principal products of the Building Products business segment are:
Commercial, Mobile Home and Industrial Pipe and Metal Building Insulation Block Insulations Commercial and Industrial Pipe and Mechanical Equipment Roofing Products and Systems Insulation and Coverings Duct Board, Duct Wrap and Liner Residential Insulation Insulation for Air Duct Systems for Walls and Attics
U.S. and Canadian Operations. The Building Products business segment manufactures and sells thermal and acoustical fiberglass insulation products (fiberglass wool) for walls and attics which are used in the construction and retrofitting of residences (including manufactured housing) and commercial, industrial and institutional buildings. These insulation products are typically sold directly to users (applicators, fabricators, contractors and manufacturers) and to distributors (dealers, retailers and wholesalers).
The majority of the Company's building insulation products are made using patented rotary manufacturing technology at locations in California, Georgia, Kansas and New Jersey, with two support facilities in Arizona and Virginia. A facility in Indiana was closed during 1992, but was reopened in 1993. In addition, Schuller's affiliate, Manville Canada Inc. ("Manville Canada") manufactures residential building insulation in Alberta, Canada.
The mechanical insulation business of the Building Products business segment manufactures and sells industrial and commercial products used to insulate mechanical piping and equipment, as well as fiberglass air duct systems and thermal acoustical blankets used to wrap and line metal duct systems. Mechanical insulation products are typically sold directly to distributors, contractors and HVAC (heating, ventilating and air conditioning) wholesalers. Production facilities for the mechanical insulation business are located in California, Colorado, Illinois, New Jersey, Ohio and Texas.
The mechanical insulation business also includes the production of calcium silicate industrial insulations which are used when mechanical strength and the capacity to withstand high temperatures are required, such as in the insulation of petrochemical and power plants. Calcium silicate insulations contain, among other things, trace amounts of crystalline silica. Schuller has labeled its calcium silicate insulations to reflect the International Agency for Research on Cancer ("IARC") finding that crystalline silica is "probably carcinogenic to humans" and has amended its Material Safety Data Sheets ("MSDS") for this product. See the discussion below under Occupational Health and Safety Aspects of Mining and Mineral Group Products.
Production of fiberglass materials is maintained at an approximately level rate throughout the year. Overall, demand for this segment's products tends to be seasonal, resulting in inventory increases during late winter and spring and decreases during the construction season and the late fall, early winter insulating months. The principal raw materials used to manufacture fiberglass are discussed below. Fiberglass wool has been classified by IARC as a possible cause of cancer in humans. See the discussion below regarding Occupational Health and Safety Aspects of Schuller Products.
The roofing system business includes commercial and industrial roofing products and systems produced in California, Georgia, Illinois, Maine, Mississippi, Oklahoma and Virginia, and supported by research facilities in Colorado. In addition to selling roofing products and systems, Schuller offers certain guarantees on installed roofing systems. In connection with the exchange of Schuller's North American residential roofing business for
the commercial and industrial roofing business of O-C completed January 16, 1994, Schuller has acquired O-C's commercial and industrial roofing plant in Oklahoma City, as well as O-C's modified bitumen equipment in Canada.
In 1993, the roofing business also included residential roofing products manufactured by Schuller in California, Georgia and Illinois, which served residential markets in the midwest, southeast, west and portions of the northeast region of the country. In connection with the O-C transaction described above, O-C has acquired Schuller's residential roofing plant facility in Savannah, Georgia and its residential roofing equipment in Waukegan, Illinois.
The principal raw materials used to manufacture roofing products are asphalt and fiberglass mat (manufactured by the Engineered Products business segment).
Schuller's roofing systems products are sold to dealers, distributors, retailers and roofing contractors. Industrial and commercial, as well as residential roofing products, are make-to-stock businesses. The demand for roofing products is divided between re-roofing existing buildings and new construction. Re-roofing demand is seasonal but relatively stable, while the demand for roofing products for new structures is both seasonal (inventory normally increases during the winter and spring months and decreases during the construction season) and cyclical. Schuller's sales are split approximately 85% to re-roofing and 15% to new construction.
In December 1988, and January 1989 the Company acquired certain phenolic roofing insulation assets and related technology from Beazer East, Inc. ("Beazer"), the successor to Koppers Company, Inc. The Company exited the phenolic roofing business in February 1992. The Company has learned that phenolic roofing insulation manufactured by the Company may, under certain circumstances, contribute to corrosion of steel decks on which the insulation is installed. The Company estimates that 2,900 metal roof decks are insulated with its phenolic product.
In 1992 the Company commenced an inspection and sampling program of decks where its phenolic product was installed between 1989 and 1992. During the last two years hundreds of inspections have been conducted and thousands of roof deck samples obtained.
A small percentage of the deck population inspected or sampled to date exhibited corrosion of sufficient severity to require replacement, remediation, or overlay of some portion of the existing metal decking. In most of these cases only "spot remediation" has been required to address the damage to the roof decks. As of December 31, 1993, the total costs to the Company for inspections and claims sampling totaled approximately $2.5 million and the total costs of remediation were approximately $2.8 million. The exact number of phenolic-related claims the Company may receive is dependent on a number of variables and cannot be determined at this time.
Based on its experience to date and the information currently available, the Company has recorded an estimated loss of approximately $19.7 millon for anticipated sampling, inspection and remediation costs. It is possible the ultimate loss, which cannot be determined at this time, could exceed this estimate.
Any determination of the ultimate cost to the Company for phenolic-related deck corrosion must take into consideration insurance which is available to address such claims as well as other sources of indemnification. The Company has substantial insurance which applies to property damage resulting from metal deck corrosion; however, the Company is presently engaged in litigation over the extent of such coverage with its primary insurance carrier. At this time the Company believes it will be successful by verdicts or settlements in its efforts to recover from its insurance carriers the receivable of $7 million recorded in the Company's financial statements at December 31, 1993. The Company's belief that it will be successful in this action is based on its interpretation of the language of the relevant insurance policies and the Company's factual investigation to date. Because of the uncertainties involved in pending litigation, no assurances are possible.
During 1993 the Company filed a lawsuit against Beazer. The Company seeks recovery from Beazer for all costs and damages incurred as a result of the acquisition of the phenolic business. Additionally, to the extent negligence of others (contractors, architects, manufacturers of other roofing system components) is a
contributing factor to roof deck corrosion, the Company may have rights in contribution for recovery of a substantial portion of its costs from such third parties.
The extent of and ability of the Company to recover costs through insurance, indemnification, contribution, and damage claims beyond the $7 million receivable recorded at December 31, 1993 cannot be quantified at this time. The ultimate amount and timing of the expected payouts for these expenses and corresponding receipt of insurance recoveries cannot be determined. The Company expects to fund any currently unreimbursed costs from cash on hand and cash generated from operations.
Competition. The principal methods of competition for the Building Products business segment include quality, service, distribution, price and product performance. Schuller believes that its products are competitive in each of these areas. Also, Schuller's regional production system provides a competitive cost and strong service position in the building insulation market in the U.S. and Canada. Based upon available industry statistics, Schuller believes it is one of the top three producers of fiberglass insulation in the U.S. Other large fiberglass and mechanical insulation producers in the U.S. include Owens-Corning Fiberglas Corp. and CertainTeed Corporation. In addition, there are several small fiberglass producers as well as numerous non-fiberglass insulation manufacturers which compete in the same markets. Primary competitors in the roofing system business include GAF Corporation and Tamko.
ENGINEERED PRODUCTS
The principal products of the Engineered Products business segment are:
Acoustical Insulation for Fine Fibers for Filtration Office Partitions HVAC Equipment and Appliance Insulation Air Filtration Media Liquid Filtration Cartridges and Tubes Aircraft and Aerospace Insulation Metal Encapsulated Aerospace and Automotive Headliners, Automotive Insulation Products Hoodliners, Molded Parts Roofing Fiber and Mat and Uncured Fiberglass Specialty Fiber and Specialty Mat for Molding Chopped Strands and Roving Products for Fiberglass Reinforced Plastics
U.S. and Foreign Operations. The Engineered Products business segment manufactures and sells fiberglass and other products used generally for insulation, reinforcement and filtration purposes. During 1993, these products were produced by Schuller at ten manufacturing plants in the U.S. (located in California, Indiana, Ohio, Tennessee, Texas and West Virginia) and by its subsidiary Schuller GmbH at three fiberglass manufacturing plants in Germany. In addition, the Engineered Products business segment is supported by research and development facilities located in Colorado, Ohio and Germany.
The fiberglass insulations produced by Schuller's Engineered Products business segment include products used to insulate aircraft, HVAC equipment, appliances, office partitions, automobiles and space vehicles. These fiberglass insulation products are manufactured to customer specifications using proprietary technology.
Chopped fiberglass is used by Schuller to produce and reinforce mats for roofing manufacturers including certain roofing products manufactured by the Building Products business segment discussed above. In addition, chopped glass fiber is sold directly to other roofing mat manufacturers and into the gypsum wallboard market. Specialty fibers manufactured by Schuller are used widely in the production of commercial wall coverings to achieve exceptional endurance and safety characteristics. Specialty mats produced from such glass fibers are incorporated into battery separators, carpeting and vinyl flooring, and facers for foam insulation.
Schuller's reinforcement products include fiberglass chopped strand and roving which are sold to the reinforced plastics industry. These products are used primarily to reinforce resin systems in filament wound, pultruded and compression and injection molded plastic parts. Long term license agreements allow Schuller to use the
reinforcement technology of Nippon Electric Glass Co. Ltd., located in Otsu, Japan, in the production of reinforcement products in North America.
Filtration products include Schuller's fine fiber filtration products which are typically sold to specialty paper manufacturers who convert the glass fibers into a finished specialty paper product for applications in the battery, pharmaceutical and semiconductor industries. Schuller's filter media products are used in air filtration systems for non-residential buildings. In addition, glass fibers are used in liquid filtration applications such as oil and fuel filters.
The products produced by the Engineered Products business segment are typically sold directly to users (applicators, fabricators, contractors and manufacturers) and to distributors (dealers and wholesalers).
The principal raw materials used to manufacture fiberglass are aluminous materials, borate minerals, lime, sand and soda ash. Phenol-formaldehyde, urea-formaldehyde and other resins are used to make various fiberglass products.
Production of engineered products is maintained at an approximately level rate throughout the year. Overall, demand for these products tends to be seasonal, resulting in inventory increases during winter and spring and decreases during the construction season.
Though the Engineered Products business segment no longer manufactures refractory ceramic fiber ("RCF"), it does continue to use limited amounts of RCF produced by third parties in the processing of certain automotive products. RCF has been classified by IARC as a possible cause of cancer. See the discussion below regarding Occupational Health and Safety Aspects of Schuller Products.
Competition. The principal methods of competition for the Engineered Products business segment include quality, service, product performance, distribution and price. Schuller believes that its products are competitive in each of these areas. Based upon available industry statistics, Schuller believes it is the largest producer of fiberglass mat in the world. Owens-Corning Fiberglas Corp., PPG Industries, Inc. and CertainTeed Corporation are the Company's principal competitors in the Engineered Products markets. In addition, there are several small companies which compete with Schuller in the filtration media markets.
OCCUPATIONAL HEALTH AND SAFETY ASPECTS OF SCHULLER PRODUCTS
Schuller manufactures, processes and sells products which contain chemicals or substances classified by IARC as potential human carcinogens. During IARC's 1987 assessment of man-made vitreous fibers ("MMVF"), fiberglass wool, RCF, and mineral wool were each classified as "possibly carcinogenic to humans." Continuous glass filament (chopped strand) was "not classifiable as to human carcinogenicity."
From its review of epidemiological studies involving occupational exposure to fiberglass wool, IARC concluded that the evidence of cancer in humans was "inadequate." The evidence from animal studies was viewed as "sufficient." IARC's finding on animal data, however, was based entirely on positive laboratory results achieved through injection or other artificial techniques of exposing animals to fibrous materials. Most scientists, including the World Health Organization, agree that animal studies using natural routes of inhalation are the most appropriate means to assess potential risks to humans. No animal inhalation study of fiberglass wool, including the most recent which was concluded in 1992, has resulted in lung fibrosis, mesothelioma or any significant increase in lung tumors.
In 1991, the authors of a U.S. epidemiology study of more than 14,000 fiberglass industry workers noted a small, but statistically significant, excess in respiratory cancer deaths. However, after looking at the cumulative evidence of all factors that might support a causal relationship, the researchers concluded that the evidence of an association between exposure to fiberglass wool and respiratory cancer appeared "somewhat weaker" than was the case when that study was reviewed by IARC in 1987 when it was found to be "inadequate."
As a result of the IARC classification, in 1988, the Company voluntarily labeled its products containing fiberglass wool and mineral wool as possible carcinogens. Since 1991, the OSHA Hazard Communication Standard has required cancer warning labels for all products containing fiberglass wool. Some states also have similar worker or community "right to know" labeling requirements. For purposes of occupational exposure, OSHA continues, however, to regulate all MMVF as inert or nuisance dusts. The Company's hazard communication labels and MSDS for products containing MMVF are current and in compliance with all state and federal regulatory requirements. The language on these labels not only advises of the possible cancer and irritation hazards, but includes proper handling and protective measures to be followed.
The Company sold most of its RCF operations in 1990. RCF products have been labeled as a possible cause of cancer since 1985. Subsequently, RCF product labels were revised to also warn of the potential hazards associated with exposure to crystalline silica which can be formed after use of RCF products at high temperatures. The Engineered Products business segment continues to use limited amounts of RCF produced by third parties in the processing of certain automotive parts.
The Company has instituted a comprehensive product stewardship communication program to supply customers and employees with up-to-date information regarding relevant medical and scientific developments. Additionally, since 1988, the Company funded, in conjunction with other companies in the industry, several epidemiological and chronic animal inhalation studies to assess the cancer-causing potential of MMVF.
Results from these studies are periodically reported to the United States Environmental Protection Agency ("EPA") under the Toxic Substances Control Act ("TSCA") and copies of such submissions regarding MMVF may be obtained from the EPA by writing to Freedom of Information Act Officer, Environmental Protection Agency, Room A101, 401 M Street, S.W., Washington, DC 20460. Copies of the Company's brochure, "Health and Safety Aspects of Fibrous Glass," may be obtained by writing to Manville Corporation, Product Information Center, P.O. Box 5108, Denver, CO 80217-5108.
The Company is continuing to assess the potential health aspects of MMVF. Based upon its analysis to date, the Company does not believe that the IARC classification or the action taken by federal and state regulatory agencies will have a material adverse effect on the Company.
CORPORATE ASSETS CORPORATE ASSETS
The Company's equity interest in platinum and palladium mining operations is more fully described under ITEM 2, PROPERTIES. Platinum Group Metals Mining Claims were previously included in the Mining and Minerals Group business segment but are now classified as a corporate asset. In April 1990, the Company announced the possible sale of this property but determined in 1991 to no longer actively solicit bids due to unfavorable market conditions for precious metals.
In March 1993, JACP, Inc., now known as IACP, Inc., a wholly-owned subsidiary of the Company, and Jet Holding Corp. ("Jet"), a subsidiary of Jet Composites Corp., formed a Delaware general partnership (the "Partnership") to continue the Company's business of producing automotive acoustical parts. During the fourth quarter of 1993, the Partnership was reorganized. In October, Pres Glas Holding Corporation, a Michigan corporation ("Pres Glas"), joined the Partnership and in November, Jet's interest in the Partnership was redeemed by the Partnership. As a result, IACP, Inc. now has an 86% interest in the Partnership and acts as its managing general partner and Pres Glas owns a 14% interest in the Partnership.
DISCONTINUED OPERATIONS
Prior to the divestiture in July 1991 of the Company's U.S. and foreign filtration and industrial minerals businesses, known as Celite Corporation, the Company produced the following products under its Mining and Minerals Group business segment.
Diatomite Filter Aids and Perlite Ore and Filler Materials Filter Aids
Schuller still utilizes perlite in its business.
OCCUPATIONAL HEALTH AND SAFETY ASPECTS OF MINING AND MINERALS GROUP PRODUCTS
Crystalline silica is one of the earth's most abundant minerals, appearing in such forms as quartz, sandstone and sand. Sand and gravel compose perhaps the largest commercial use of crystalline silica. Some of the Company's current products contain small amounts of amorphous or crystalline silica. Historically, however, the filter aids and filler materials manufactured by Celite Corporation represented the Company's principal silica-containing products.
In 1988, IARC published its evaluation of the carcinogenic risk of silica and silicates. Crystalline silica was classified as a substance "probably carcinogenic to humans" based on IARC's assessment that the evidence was "sufficient" with respect to laboratory animal studies and "limited" as to humans. The evidence for amorphous silica in both animal and human studies was determined to be "inadequate." As a result, IARC determined amorphous silica to be "not classifiable in humans."
In 1992, the authors of a University of Washington mortality study of 1,700 current and former diatomaceous earth ("DE") workers reported statistically significant increases of lung cancer and non-malignant respiratory disease among the population studied -- particularly among those workers whose exposure occurred before the 1950's. The Company continues to be involved in this research program.
Beginning in the 1950's, the Company's DE product labels warned of a potential silicosis risk involved in the use of those products. In response to the 1988 IARC action, the Company modified the labels on its DE and other silica- containing products to conform to the IARC classification. Product MSDS were also revised to reflect the IARC evaluation. Additionally, the Company implemented a customer and employee communications program regarding IARC's conclusions pertaining to crystalline silica through the distribution of MSDS and other related materials.
In 1988, the Company instituted a DE indemnification program under which the Company agreed to indemnify its customers if bodily injury claims are filed against the customer alleging disease as a result of exposure to DE produced by the Company. Under the terms of the indemnity, the Company is only responsible for that portion of the claim that arises out of exposure to the Company DE. The indemnification excludes claims arising under workers' compensation, claims for consequential and punitive damages, and claims which result from negligence, misuse or intentional acts of the customer.
Copies of the Company's brochure, "Health and Safety Aspects of Diatomaceous Earth," may be obtained by writing to Manville Corporation, Product Information Center, P.O. Box 5108, Denver, CO 80217-5108.
Based upon its analysis to date, the Company does not believe that the IARC classification or other subsequent events discussed above will have a material adverse effect on the Company.
PATENTS
The Company presently owns, controls or holds licenses to approximately 3,000 U.S. and foreign patents and patent applications.
RESEARCH
The Company spent approximately $31.3 million in 1993, $34.0 million in 1992 and $33.7 million in 1991 on Company-sponsored research activities, excluding engineering and exploration, related to the development and improvement of its products and services.
ENVIRONMENTAL AND SAFETY REGULATIONS
All of the Company's domestic operations are subject to a variety of federal, state and local environmental laws and regulations. The most significant of the federal laws are the Clean Air Act, the Clean Water Act, TSCA, the Resource Conservation and Recovery Act ("RCRA") and the Comprehensive Environmental Response, Compensation and Liability Act of 1980 ("CERCLA"), and the Emergency Planning and Community Right-to-Know Act ("EPCRA"), in each case including the regulations promulgated thereunder, all of which are administered by the EPA or various states. These laws and regulations establish potential liability for costs incurred in cleaning up waste sites and impose limitations on atmospheric emissions, discharges to navigable waters and disposal of wastes. In addition, certain state and local jurisdictions have adopted equivalent or more stringent regulations, or have enacted their own parallel environmental programs, which are enforced through various state administrative agencies. These laws and regulations affect the Company because they impose limitations on atmospheric emissions, discharges to navigable waters and disposition of wastes; control the use, storage and disposal of hazardous substances; require public disclosure regarding the presence on manufacturing sites of certain substances and of the nature of certain such emissions; and establish potential liability for costs incurred in cleaning up waste sites.
The Company's plants and certain products which it ships into commerce are subject to OSHA's Hazard Communication Standard. Several states have also enacted and adopted "right to know" laws and regulations which require notice to workers, as well as to the general public, of the hazards associated with chemicals in the workplace.
In 1990, amendments to the Clean Air Act required the EPA to issue regulations limiting the emission of certain hazardous air pollutants. Until these regulations are promulgated, the Company cannot determine how and when the Clean Air Act will affect its operations. The Company does not believe the new Clean Air Act glass fiber manufacturing regulations will be issued before 1997. The Company believes that the anticipated regulations will require the Company to reduce air emissions from its manufacturing processes. The Company currently believes that compliance with the regulations under the Clean Air Act will not have a material adverse effect on the Company's operations, financial condition or liquidity.
In addition, the EPA has issued new proposed regulations for the pulp and paper industry (the "Proposed Regulations"). It is expected that the earliest time for industry compliance with the Proposed Regulations should not be prior to the first quarter of 1999. The Company estimates that capital spending that may be required to comply with the Proposed Regulations could reach between $20 million and $40 million to be spent over a three year period beginning in 1996.
The Company has on-going programs to ensure its compliance with existing environmental laws and regulations and to anticipate and design programs necessary to manage the impacts of future environmental regulations. The Company believes that it is in substantial compliance with all applicable environmental and occupational health laws and regulations. The Company also believes it has all permits and other governmental authorizations to carry on all activities related to the business.
Compliance with the specific laws and regulations referenced above and others have resulted in certain expenditures by the Company, including those necessary to improve or replace environmental quality control equipment, to secure federal and state permits for expansion of existing facilities and construction of new facilities, and to study and remediate certain waste disposal sites. The exact nature of environmental control and safety compliance issues which the Company may encounter in the future cannot be predicted, primarily because of the increasing number, complexity and changing character of the standards being promulgated by federal, state and local authorities. For a discussion of legal proceedings related to environmental matters and activities see ITEM 3, LEGAL PROCEEDINGS.
EMPLOYEES
During 1993, the Company employed approximately 16,000 persons worldwide, of which approximately 9,200 were covered by collective bargaining agreements.
ITEM 2.
ITEM 2. PROPERTIES
HEADQUARTERS AND MOUNTAIN TECHNICAL CENTER
Manville and Schuller are headquartered in approximately 252,000 square feet of leased space at Manville Plaza, a downtown Denver, Colorado office building. Mountain Technical Center, Schuller's primary research and development facility, consists of 308,000 square feet of floor space located in Littleton, Colorado. Riverwood is headquartered and leases approximately 75,000 square feet of office space in Atlanta, Georgia.
MANUFACTURING FACILITIES
A listing of the major plants and properties owned, leased and operated by the Company's principal operating subsidiaries is set forth below. Additional information on the Company's mining operations is provided in the subsection following the description of manufacturing facilities. Substantially all of the buildings are adequate and suitable for the business of the Company, have been well maintained and are in sound operating condition and regular use. The Company's pulp and paper mill and related facilities located near West Monroe, Louisiana are subject to aggregate mortgage loans of approximately $195 million. In addition, the Company's Macon Mill is subject to mortgage loans aggregating approximately $179 million.
The Company leases certain facilities, warehouses and office space throughout the U.S. and in foreign countries. Except for the Lakewood, Colorado; Jacksonville, Florida; Marietta, Georgia; Elkhart, Indiana; Clinton, Mississippi (underlying real estate only); Saddlebrook, New Jersey; and Ennis, Texas facilities, which are controlled under leases, all of the following facilities are owned in fee. A portion of the Company's facility at Laurinburg, North Carolina was leased to Railroad Friction Products Corporation ("RFPC") when the Company divested its interest in RFPC.
MINING
Platinum Group Metals Mining Claims. In 1984, Manville, Chevron U.S.A., Inc. ("Chevron") and Anaconda Minerals Company ("Anaconda") entered into a three- way venture known as Stillwater Mining Company. In late 1988, Manville and Chevron purchased the remaining one-third interest in the Stillwater Complex from LAC Mineral Exploration (Texas), Inc. (which had purchased it from Anaconda in 1986), and, as a result, Manville and Chevron each held one-half interest in the Stillwater Mining Company Venture. During 1993, Manville and Chevron reorganized the Stillwater Mining Company and Stillwater PGM Resources partnerships. The assets of the two partnerships were transferred into a new corporation, Stillwater Mining Company ("SMC"). The shares of SMC are held by Manville and Chevron, each owning one-half of the shares. In addition, Manville transferred to SMC its interest in most of the patented and unpatented mining claims along the approximate 28 mile mineralized zone in the Stillwater Complex in Park, Stillwater and Sweetgrass counties in Montana. In exchange for the transfer, SMC conveyed to Manville a 5% net profits interest in most of the claims.
SMC currently operates at a mining and milling rate of 1,000 tons per day. SMC has obtained final approval from federal and state authorities to expand its capacity to 2,000 tons per day. The Company is not able to state when or under what conditions this expansion will commence.
Platinum group metals, which consist of iridium, osmium, palladium, platinum, rhodium and ruthenium, are among the scarcest of metallic elements and are used in the electrical and electronics industries, petroleum refining, the production of catalytic exhaust systems, and for many other manufacturing operations and uses.
The independent minerals industry consulting firm of Behre Dolbear & Company, Inc. of New York, New York has calculated the ore reserves, as of July 1, 1993, of the Stillwater Complex at 22,573,000 tons of proven and probable mining reserves. Such reserves have an average grade of 0.78 ounces of platinum and palladium per ton, containing approximately 17,658,000 troy ounces of platinum and palladium (at about 3.5 parts of palladium per 1 part of platinum). These tonnage, grade and metal content estimates do not reflect losses due to processing.
In April 1990, the Company announced the possibility of the sale of its equity interest in its Stillwater mining operations. Due to unfavorable conditions in the precious metals markets, the Company suspended active solicitation of bids for this property in 1991.
TIMBER RESOURCES
Riverwood owns approximately 534,000 acres of timberland in Arkansas, Louisiana and Texas which it manages as a raw material base for its domestic paper and wood products operations. Riverwood operates its southern pine forests on a sustained yield basis. In 1972, Riverwood initiated a forestry program to increase the yield from its domestic pine forests. For 1993, this program involved approximately 18,000 acres. As a result of this program, it is expected that the cubic foot volume growth of Riverwood's pine timberlands will more than double during a 30-year cycle. Riverwood also holds long-term leases to approximately 6,000 acres of timberland in Louisiana and Texas.
Riverwood's Brazilian operations own or control under long-term leases approximately 144,000 acres of land in the State of Santa Catarina, Brazil, and 30,000 acres of land in the State of Sao Paulo, Brazil. This timberland, which is located approximately 2,200 miles south of the Brazilian rain forest, is capable of supplying substantially all of the pulpwood requirements of Riverwood's Brazilian paper mills based on current consumption levels.
ITEM 3.
ITEM 3. LEGAL PROCEEDINGS
The Company has provided detailed disclosures on its reorganization proceedings, asbestos-health and asbestos property damage claims and other material litigation in its earlier reports filed with the Securities and Exchange Commission. Parties interested in obtaining the earlier reports may contact the Company in care of Investor Relations, Manville Corporation, P.O. Box 5108, Denver, CO 80217-5108, specifying the information desired. In addition, the description below of the Company's Second Amended and Restated Plan of Reorganization (the "Plan"), as modified, which was re-filed with the Securities and Exchange Commission as an exhibit to the Company's Form 10-K for the fiscal year ended December 31, 1992, is qualified in its entirety by reference to the Plan. Copies of the Plan are also available from the Company upon request.
PLAN OF REORGANIZATION AND RELATED INJUNCTION
In 1982, Manville and its principal U.S. and Canadian subsidiaries filed petitions for reorganization under Chapter 11 of the United States Bankruptcy Code. The filings were precipitated by contingent liabilities resulting from litigation arising out of the Company's previous asbestos-related business operations. A separate Plan of Reorganization for Riverwood International USA, Inc., a principal subsidiary of Riverwood, was confirmed by the Bankruptcy Court in 1984. In December 1986, the Plan was confirmed by the Bankruptcy Court. The order confirming the Plan became final in 1988 and the Plan was consummated on November 28, 1988. During the fourth quarter of 1988, the Company made various distributions to creditors and equity holders as required under the Plan.
The Plan relieves the Company of the burden of defending thousands of asbestos lawsuits. This is accomplished through independent trusts created to assume, administer, settle and pay claims. In lieu of bringing actions against the Company, asbestos claimants may assert their claims only against the PI Trust or the PD Trust, which are funded by the Company pursuant to the Plan. Only claims filed by May 31, 1985 may be brought against the PD Trust. The Plan, the Injunction and the federal Bankruptcy Code together operate to prohibit all persons from taking any actions against the Company with respect to any past, present or future asbestos-related liabilities. The Injunction and the Plan also prohibit the assertion of punitive damage claims by asbestos claimants against the Company, the PI Trust or the PD Trust.
The Injunction is a unique feature of the Company's Chapter 11 proceedings and could be challenged in future legal proceedings. The Company believes, and the Bankruptcy Court has found, that the Injunction is essential to the Company's ability to continue to operate its businesses and to make required payments to the PI Trust and the PD Trust. The Company also believes that any attempt to vacate or modify the Injunction will be unsuccessful.
On November 19, 1990, the Company and the PI Trust entered into the Refinancing Arrangement which, if consummated, would have enhanced the PI Trust's liquidity. Also on November 19, 1990, five asbestos plaintiffs filed the Class Action against the Trustees of the PI Trust in the Courts. The Class Action was filed on behalf of all beneficiaries of the PI Trust and seeks to restructure the methods by which the PI Trust administers and pays claims. The Company is not a party to the Class Action. On November 26, 1990, the Company filed a separate motion asking the Courts and the Bankruptcy Court to issue orders reaffirming the Injunction. Certain provisions of the Refinancing Arrangement were subject to numerous approvals and conditions, including, among other things, a final order approving the Restructuring Settlement.
In May 1991, the Courts and the Bankruptcy Court entered the Order, which, among other things, reaffirmed the Injunction and approved the Restructuring Settlement. Thirteen appeals of the Order were filed by various parties; however, the Reaffirmation Order was not challenged in the lower court or on appeal. On February 24, 1992, the Second Circuit heard the various appeals of the Order.
On December 4, 1992, the Second Circuit vacated and remanded the Order. The Second Circuit found, among other things, that the representatives of the class may not have fairly represented the interests of all persons who were made part of the Class Action. The decision of the Second Circuit, as subsequently modified, has become final. As a result, various aspects of the Refinancing Arrangement have terminated. Attempts by the parties to the Class Action to reach a new settlement are continuing. One day of trial of the Class Action was held on March 15, 1994, and in the absence of a settlement, the trial will resume following a conference before the Courts currently scheduled for April 18, 1994.
Those aspects of the Refinancing Arrangement which terminated when the Appeals Court Decision became final and non-appealable include:
1) Payment of the remaining special dividends: $.42 per share payable not earlier than 1996; $.42 per share payable one year later; and, depending on the Company's performance, additional annual dividends with a cumulative cap of $300 million over four years commencing not earlier than 1996;
2) Restructuring of the two bonds of the Company issued to the PI Trust under the Plan; and
3) Modification of certain restrictive covenants contained in contracts between the Company and the PI Trust.
Certain of the aspects of the Refinancing Arrangement referred to in (2) and (3) of the preceding paragraph were addressed in the Agreement dated August 25, 1993, pursuant to which Manville made a partial prepayment of certain of its obligations to the PI Trust under the bonds issued to the PI Trust. The partial prepayment consisted of a cash payment of $150 million and an assignment to the PI Trust of $100 million principal amount of the Notes held by Manville, plus accrued interest. The Agreement also provided for certain registration rights with respect to the Notes pursuant to which Riverwood registered the Notes under the Act. On October 14, 1993, the PI Trust completed a public secondary sale of the Notes. Neither the Company nor Riverwood received any of the proceeds from the offering made by the PI Trust.
Manville is committed to the general principles underlying the terminated Refinancing Arrangement and to fulfilling its obligations to the PI Trust and to all stockholders under the Plan.
ENVIRONMENTAL PROCEEDINGS
The Company's landfill at its Waukegan, Illinois facility continues to be included on the National Priorities List ("NPL") pursuant to CERCLA. Remedial action began during the fourth quarter of 1988 and was completed during the third quarter of 1991. During the first quarter of 1993, the EPA issued a supplemental CERCLA decision document, i.e., an Explanation of Significant Differences ("ESD"), to reflect that, inter alia, remedial action was taken onsite which was in addition to that described in the Record of Decision and the Consent Decree. The EPA is now seeking both a modification to the Consent Decree to incorporate the additional remedial action described in the ESD as well as appropriate deed restrictions for the site. The Company has been informed that the Consent Decree modification and the deed restrictions should be approved in the second quarter of 1994. After these approvals, the Company will apply for the Certificate of Completion (the "Certificate") and the Company is informed that the EPA will likely issue the Certificate in 1994. After the Certificate is issued, the Company will seek to have the site deleted from the NPL.
Regarding a landfill located in Manville, New Jersey, the Company has submitted a revised closure plan to the New Jersey Department of Environmental Protection and Energy ("NJDEPE"). Closure of the landfill will follow NJDEPE's approval of the plan.
In connection with the Macon paper mill acquisition, Riverwood International Georgia, Inc. ("RVW Georgia"), a wholly-owned subsidiary of Riverwood, has made appropriate applications and requests for all necessary permits for the operation of the Macon facility, including an air permit for operation of a recovery boiler that was subject to a consent order previously issued to Macon Kraft, Inc. by the Georgia Department of Natural Resources ("GDNR"). A Consent Order dated November 5, 1992 was entered into by RVW Georgia and
GDNR (the "RVW Consent Order") which supersedes the original consent order between Macon Kraft, Inc. and GDNR. The terms of the RVW Consent Order require that construction of a new recovery boiler be completed, and compliance with GDNR's total reduced sulfur ("TRS") emission limits be demonstrated, no later than September 29, 1994. A payment of $500,000 by RVW Georgia to GDNR was also required. If compliance with the TRS limits is not demonstrated by September 29, 1994, an additional payment of $200,000 will be required from RVW Georgia to GDNR. RVW Georgia anticipates that the recovery boiler project will be completed on or before September 29, 1994.
The Company has also been informed of certain environmental problems associated with former disposal sites (most of which were never owned or operated by the Company), in California, Colorado, Florida, Georgia, Illinois, Indiana, Louisiana, Maine, Massachusetts, Michigan, Mississippi, New Hampshire, New Jersey, New York, North Carolina, Ohio, Oklahoma, Tennessee, Utah and Wisconsin. These problems include, in certain cases, the purported application of CERCLA, RCRA, and their state law equivalents.
OTHER LITIGATION
Manville Canada and Schuller had been named in certain personal injury and property damage lawsuits filed in the Supreme Court of British Columbia which alleged unspecified damages from the presence of asbestos. Pursuant to an agreement dated August 31, 1993, plaintiffs to the asbestos litigation, Manville Canada, Schuller and Manville agreed to settle the lawsuits to avoid further litigation costs. The terms of the agreement are confidential.
ITEM 4.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
During the fourth quarter of 1993, there were no matters submitted to a vote of security holders.
PART II
ITEM 5.
ITEM 5. MARKET PRICE FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
Manville had approximately 16,513 common stockholders of record at March 15, 1994. Manville's stock is listed on the New York Stock Exchange, Inc. (symbol MVL), and its stock is traded on the Boston, Midwest, Pacific and Philadelphia exchanges. The Company has scheduled the 1994 Annual Meeting of Stockholders for June 3, 1994 in Denver, Colorado.
A two-year history of high and low sale prices for the Company's common stock based on the sales transactions reported by the New York Stock Exchange, Inc. is provided below. On June 4, 1993, a dividend of $1.04 was declared on the Company's common stock, payable June 24, 1993, to stockholders of record on June 14, 1993.
COMPARATIVE STOCK DATA
Market Prices Per Common Share
ITEM 6.
ITEM 6. SELECTED FINANCIAL DATA
Information with respect to this item is incorporated by reference to Selected Five-year Financial Data in the Company's 1993 Annual Report.
ITEM 7.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Information with respect to this item is incorporated by reference to Management's Discussion and Analysis of Financial Condition and Results of Operations in the Company's 1993 Annual Report.
ITEM 8.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Information with respect to this item is incorporated by reference to the Financial Statements and Supplementary Data in the Company's 1993 Annual Report.
ITEM 9.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
There were no changes in, nor disagreements with, accountants on accounting or financial disclosures.
PART III
ITEM 10.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Information with respect to this item is incorporated by reference to the Company's 1994 Proxy Statement.
ITEM 11.
ITEM 11. EXECUTIVE COMPENSATION
Information with respect to this item is incorporated by reference to the Company's 1994 Proxy Statement.
ITEM 12.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Information with respect to this item is incorporated by reference to the Company's 1994 Proxy Statement.
ITEM 13.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Information with respect to this item is incorporated by reference to the Company's 1994 Proxy Statement.
PART IV
ITEM 14.
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(A) FINANCIAL STATEMENTS, FINANCIAL STATEMENT SCHEDULES AND EXHIBITS FILED IN THIS REPORT:
1. Index to Financial Statements and Supplementary Data. Information with respect to this item is incorporated by reference to the Financial Statements and Supplementary Data in the Company's 1993 Annual Report.
2. Index to Financial Statement Schedules. See page 39.
3. Index to Exhibits required by Form 10-K. See pages 31 through 37.
4. Executive Compensation Plans and Arrangements.
Exhibits 4(a)-(i) are filed as exhibits to the Company's Annual Report on Form 10-K for the year ended December 31, 1993 and are incorporated herein by reference.
(a) Supplemental Pension Plan.
(b) Key Man Supplemental Retirement Agreements.
(c) Annual Executive Incentive Compensation Plan.
(d) 1991 Long-Term Cash Incentive Compensation Plan.
(e) Amendment to Long-Term Cash Incentive Compensation Plan.
(f) Executive Long-Term Disability Plan.
(g) Form of Employment Agreement with the Five Most Highly Compensated Executive Officers of Registrant.
(h) Manville Corporation Stock Incentive Plan.
(i) Amendment to Manville Corporation Stock Incentive Plan.
(B) REPORTS ON FORM 8-K
None.
(C) EXHIBIT INDEX TO MANVILLE CORPORATION ANNUAL REPORT ON FORM 10-K FOR FISCAL YEAR ENDED DECEMBER 31, 1993
Pursuant to the Securities Exchange Act of 1934, Item 601(b)(4)(iii) of Regulation S-K, the Company hereby agrees to furnish a copy of each document set forth below upon request of the Securities and Exchange Commission.
Amended and Restated Note Purchase Agreement of Riverwood International Georgia, Inc. for $103,444,379 of 11.15% Senior Notes due 2000, dated June 30, 1992.
Indenture of Riverwood International Corporation for $150 million of 10 3/4% Senior Notes Due 2000, dated June 24, 1992.
Indenture of Riverwood International Corporation for $250 million of 11 1/4% Senior Subordinated Notes Due 2002, dated June 24, 1992.
Indenture of Riverwood International Corporation for $125 million of 6 3/4% Convertible Subordinated Notes Due 2003, dated September 15, 1993.
Indenture of Riverwood International Corporation for $37.5 million of 10 3/4% Senior Notes II Due 2000, dated as of June 24, 1992, as amended and restated on October 14, 1993.
Indenture of Riverwood International Corporation for $62.5 million of 11 1/4% Senior Subordinated Notes II Due 2002, dated as of June 24, 1992, as amended and restated on October 14, 1993.
Agreement amending and restating Note Agreements among Riverwood International USA, Inc., as Borrower; Riverwood International Corporation, as Guarantor; and The Prudential Insurance Company of America, as Servicer of The Chase Manhattan Bank, National Association, as Trustee for Private Placement Trust Series 1984F, Metropolitan Life Insurance Company, Aetna Life Insurance Company, The Mutual Life Insurance Company of New York, MONY Life Insurance Company of America, as Lenders, dated as of May 25, 1993.
$50 million Credit Agreement, among Riverwood International Corporation; Riverwood International USA, Inc.; various listed banks; and Morgan Guaranty Trust Company of New York, dated December 10, 1992.
$100 million Amended and Restated Credit Agreement of Riverwood International Georgia, Inc. with Midland Bank PLC, New York Branch, as Agent, dated June 30, 1992.
60 million (Australian Dollars) Secured Facility Agreement between Multiboard Packaging Pty. Ltd. and Australia and New Zealand Banking Group Limited, dated September 21, 1992.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Stockholders and Directors of Manville Corporation:
Our report on the consolidated financial statements of Manville Corporation has been incorporated by reference in this Form 10-K from page 67 of the 1993 Annual Report to Stockholders of Manville Corporation. In connection with our audits of such financial statements, we have also audited the related financial statement schedules listed in the Index to Financial Statement Schedules on page 39 of this Form 10-K.
In our opinion, the financial statement schedules referred to above, when considered in relation to the basic financial statements taken as a whole, present fairly, in all material respects, the information required to be included therein.
/s/ Coopers & Lybrand --------------------- Coopers & Lybrand
Denver, Colorado February 4, 1994
MANVILLE CORPORATION INDEX TO FINANCIAL STATEMENT SCHEDULES TO FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 1993
Schedule Page - -------- ----
V - Property, plant and equipment, for each of the three years in the period ended December 31, 1993.............. 40
VI - Accumulated depreciation, depletion and amortization of property, plant and equipment, for each of the three years in the period ended December 31, 1993........ 41
VIII - Valuation and qualifying accounts and reserves, for each of the three years in the period ended December 31, 1993........................................ 42
IX - Short-term borrowings, for each of the three years in the period ended December 31, 1993........................... 43
X - Supplementary income statement information, for each of the three years in the period ended December 31, 1993........................................ 44
MANVILLE CORPORATION SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT FOR THE YEARS ENDED DECEMBER 31 (IN THOUSANDS OF DOLLARS)
See Notes on page 41.
MANVILLE CORPORATION SCHEDULE VI - ACCUMULATED DEPRECIATION, DEPLETION AND AMORTIZATION OF PROPERTY, PLANT AND EQUIPMENT FOR THE YEARS ENDED DECEMBER 31 (IN THOUSANDS OF DOLLARS)
NOTES:
(a) Additions in 1992 and 1991 include $201 million and $22 million, respectively, related to the acquisition of Riverwood businesses.
(b) Includes amounts applicable to discontinued operations.
(c) Includes the current year translation effect of the Company's foreign operations, amounts for the cost of timber harvested, write-downs of assets no longer in use and provisions for the disposition of certain assets.
(d) The Company has reclassified the presentation of certain prior year information to conform with the current presentation format.
MANVILLE CORPORATION SCHEDULE VIII - VALUATION AND QUALIFYING ACCOUNTS AND RESERVES FOR THE YEARS ENDED DECEMBER 31 (IN THOUSANDS OF DOLLARS)
- -------------------------------------------------------------------------------- NOTES:
(a) Charged against sales, except for adjustments to deferred tax assets and the related valuation allowance which were charged to income taxes.
(b) Principally charges for which reserves were provided, net of recoveries.
MANVILLE CORPORATION SCHEDULE IX - SHORT-TERM BORROWINGS FOR THE YEARS ENDED DECEMBER 31 (IN THOUSANDS OF DOLLARS)
NOTE:
(A) The weighted average interest rate during the period was calculated by dividing the related interest expense by the average short-term borrowings outstanding during the year.
MANVILLE CORPORATION SCHEDULE X - SUPPLEMENTARY INCOME STATEMENT INFORMATION FOR THE YEARS ENDED DECEMBER 31 (IN THOUSANDS OF DOLLARS)
NOTE:
(a) Does not include amounts applicable to discontinued operations, which were excluded from the determination of income from continuing operations.
EXHIBIT 22. SUBSIDIARIES OF THE REGISTRANT
Subsidiaries of Manville and the jurisdiction in which each company was incorporated are listed below. All of the voting securities of each subsidiary are owned directly or indirectly by Manville. Certain companies not important to an understanding of Manville's businesses have been omitted and which, if aggregated, would not constitute a significant subsidiary. The following subsidiaries are included in the Company's consolidated financial statements.
JURISDICTION OF SUBSIDIARY INCORPORATION ---------- --------------- AGROK AGRO-FLORESTAL LTDA. --Brazil DANAPAK RIVERWOOD MULTIPACK A/S --Denmark EUROPEAN OVERSEAS CORPORATION --Delaware FISKEBY BOARD AB --Sweden FISKEBY BOARD A/S --Denmark FISKEBY BOARD LTD. --United Kingdom FISKEBY BOARD S.a.r.l. --France GFE IMPORT-EXPORT G.m.b.H. --Germany IGARAS AGRO-FLORESTAL LTDA. --Brazil IGARAS PAPEIS E EMBALAGENS LTDA. --Brazil IACP, INC. --Delaware JOHNS-MANVILLE INDIA LIMITED --Delaware JORBA, S.A. --Spain MANVILLE (U.K.) LTD. --United Kingdom MANVILLE CANADA INC. --Ontario MANVILLE DE FRANCE S.a.r.l. --France MANVILLE DO BRASIL ISOLANTES TERMICOS LTDA. --Brazil MANVILLE EUROPE CORPORATION --Delaware MANVILLE JAPAN K.K. --Japan MANVILLE MEXICANA S.A. DE C.V. --Mexico MANVILLE MINING COMPANY --Delaware MULTIBOARD PACKAGING PTY LTD. --Australia NEW MATERIALS LTD. --United Kingdom P.C. EMPREENDIMENTOS PARTICIPACOES E COMERCIO LTDA. --Brazil PAPELOK S.A. INDUSTRIA E COMERCIO --Brazil PINE PIPELINE, INC. --Louisiana RIVERWOOD ENERGY RESOURCES, INC. --Delaware RIVERWOOD INTERNATIONAL ASIA PTE LTD. --Singapore RIVERWOOD INTERNATIONAL B.V. --Netherlands RIVERWOOD INTERNATIONAL CANADA INC. --Canada RIVERWOOD INTERNATIONAL CORPORATION --Delaware RIVERWOOD INTERNATIONAL GEORGIA, INC. --Delaware RIVERWOOD INTERNATIONAL JAPAN K.K. --Japan RIVERWOOD INTERNATIONAL LIMITED --United Kingdom RIVERWOOD INTERNATIONAL PACKAGING, ASIA PACIFIC, LIMITED --Hong Kong RIVERWOOD INTERNATIONAL, S.A. --France RIVERWOOD INTERNATIONAL USA, INC. --Delaware RIVERWOOD MEHRSTUCKVERPACKUNG G.m.b.H. --Germany RIVERWOOD PACKAGING SYSTEMS PTY LTD. --Australia RIVERWOOD RENGO MACHINERY K.K. --Japan ROCKY MOUNTAIN INTERNATIONAL INSURANCE LTD. --Bermuda SCHULLER FUNDING CORPORATION --Delaware SCHULLER GROUP, INC. --Delaware SCHULLER G.m.b.H. --Germany SCHULLER INTERNATIONAL B.V. --Netherlands SCHULLER INTERNATIONAL, INC. --Delaware SCHULLER INTERNATIONAL JAPAN Y.K. --Japan
SEVENTEENTH STREET REALTY, INC. --Colorado SLEVIN SOUTH COMPANY --Arkansas STILLWATER MINING COMPANY --Delaware TERMOACUSTICOS S.A. DE C.V. --Mexico
POWER OF ATTORNEY
Know all men by these present that each person whose signature appears below does hereby constitute and appoint W. THOMAS STEPHENS, ROBERT E. COLE AND RICHARD B. VON WALD, and each of them, with full power to act without the other, his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign all amendments to this report, and to file the same with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission granting unto said attorney-in- fact and agent, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agents or any of them, or his substitute or substitutes, lawfully do or cause to be done by virtue hereof.
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 AS OF THE 28TH OF MARCH, 1994.
MANVILLE CORPORATION (Registrant)
By: /s/ W. Thomas Stephens ------------------------------------ W. Thomas Stephens Chairman of the Board, President, Chief Executive Officer and Director
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant in the capacities indicated as of March 28, 1994.
SIGNATURE TITLE --------- -----
PRINCIPAL EXECUTIVE OFFICER:
/s/ W. Thomas Stephens ---------------------------------- Chairman of the Board, President, (W. Thomas Stephens) Chief Executive Officer and Director
PRINCIPAL FINANCIAL OFFICER:
/s/ Robert E. Cole ---------------------------------- Senior Vice President, (Robert E. Cole) Corporate Finance
DIRECTORS (OTHER THAN ABOVE OFFICER-DIRECTOR):
/s/ Bette B. Anderson ---------------------------------- Director (Bette B. Anderson)
/s/ John C. Burton ---------------------------------- Director (John C. Burton)
/s/ Ernest H. Drew ---------------------------------- Director (Ernest H. Drew)
/s/ Robert A. Falise ---------------------------------- Director (Robert A. Falise)
/s/ Robert E. Fowler, Jr. ---------------------------------- Director (Robert E. Fowler, Jr.)
/s/ Todd Goodwin ---------------------------------- Director (Todd Goodwin)
/s/ Michael N. Hammes ---------------------------------- Director (Michael N. Hammes)
/s/ John Nils Hanson ---------------------------------- Director (John Nils Hanson)
/s/ Louis Klein, Jr. ---------------------------------- Director (Louis Klein, Jr.)
/s/ Stanley J. Levy ---------------------------------- Director (Stanley J. Levy)
/s/ Christian E. Markey, Jr. ---------------------------------- Director (Christian E. Markey, Jr.)
/s/ Will M. Storey ---------------------------------- Director (Will M. Storey)
/s/ Raymond S. Troubh ---------------------------------- Director (Raymond S. Troubh)
ADDITIONAL INFORMATION
Individuals interested in receiving additional information may contact the following:
For Company Information For Product Information - ----------------------- -----------------------
Call (303) 978-2000 Call (303) 978-4900 or (800) 654-3103 or write to: or write to: Manville Corporation Manville Corporation Investor Relations Product Information P. O. Box 5108 P. O. Box 5108 Denver, CO 80217-5108 Denver, CO 80217-5108
Transfer Agent and Registrar Independent Accountants - ---------------------------- -----------------------
First Chicago Trust Company of New York Coopers & Lybrand P. O. Box 2532, Suite 2532 370 Seventeenth Street, Suite 3300 Jersey City, NJ 07303-2532 Denver, CO 80202-5633