<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended February 28, 1994 Commission file number 1-1499
-------
EAGLE-PICHER INDUSTRIES, INC.
- -------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
OHIO 31-0268670
- --------------------------------- ----------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
580 Walnut Street, P. O. Box 779, Cincinnati, Ohio 45201
- -------------------------------------------------------------------------------
(Address of principal executive offices) Zip Code
Registrant's telephone number, including area code 513-721-7010
-----------------------------
(Not Applicable)
- -------------------------------------------------------------------------------
Former name, former address and former fiscal year,
if changed since last report
Indicate by check mark whether the registrant (1) has
filed all reports required to be filed by Section 13
or 15(d) of the Securities Exchange Act of 1934 during
the preceding twelve months, and (2) has been subject
to such filing requirements for the past 90 days. Yes X No
---- ----
11,040,932 shares of common capital stock, par value
$1.25 per share, were outstanding at April 8, 1994.
1
<PAGE> 2
EAGLE-PICHER INDUSTRIES, INC.
QUARTERLY REPORT - FORM 10-Q - FOR THE QUARTER ENDED FEBRUARY 28, 1994
TABLE OF CONTENTS
Page
Number
------
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.................................... 3
Consolidated Statement of Income............................ 3
Consolidated Balance Sheet.................................. 4
Consolidated Statement of Cash Flows........................ 6
Notes to Consolidated Financial Statements.................. 8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations......................... 13
PART II. OTHER INFORMATION
Item 1. Legal Proceedings....................................... 15
Item 3. Defaults Upon Senior Securities......................... 15
Item 6. Exhibits and Reports on Form 8-K........................ 15
Signature........................................................ 16
Exhibit Index.................................................... 17
Exhibits......................................................... 18
2
<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
<TABLE>
EAGLE-PICHER INDUSTRIES, INC.
CONSOLIDATED STATEMENT OF INCOME
(Dollars in thousands except per share amounts)
<CAPTION>
Three Months Ended
February 28
------------------
1994 1993
-------- --------
<S> <C> <C>
Net Sales $177,754 $146,971
-------- --------
Operating Costs and Expenses:
Cost of products sold 146,383 122,225
Selling and administrative 17,590 16,356
------- -------
163,973 138,581
------- -------
Operating Income 13,781 8,390
Interest expense (454) (419)
Other income 166 555
------- -------
Income Before Reorganization
Items, Taxes and Cumulative
Effect of Accounting Change 13,493 8,526
Reorganization items (1,082) (1,322)
------- -------
Income Before Taxes and Cumulative
Effect of Accounting Change 12,411 7,204
Income Taxes 1,372 800
------- -------
Income Before Cumulative
Effect of Accounting Change 11,039 6,404
Cumulative Effect of Change
in Accounting for Postretirement
Benefits - (12,598)
------- -------
Net Income (Loss) $ 11,039 $ (6,194)
======= =======
Income (Loss) per Share:
Before Cumulative Effect of
Accounting Change $1.00 $0.59
Cumulative Effect of Change in
Accounting for Postretirement
Benefits - (1.14)
------- -------
Net Income (Loss) $1.00 $(0.55)
======= =======
<FN>
See accompanying notes to the consolidated financial statements.
</TABLE>
3
<PAGE> 4
<TABLE>
EAGLE-PICHER INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEET
(Dollars in thousands)
<CAPTION>
ASSETS Feb. 28 Nov. 30
1994 1993
------- -------
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 85,282 $ 84,574
Receivables, less allowances 101,533 97,586
Income tax refund receivable 3,275 3,275
Inventories:
Raw materials and supplies 36,200 35,168
Work in process 18,208 20,193
Finished goods 14,650 12,945
-------- --------
69,058 68,306
Prepaid expenses 9,572 8,283
-------- --------
Total current assets 268,720 262,024
-------- --------
PROPERTY, PLANT AND EQUIPMENT 382,325 375,732
Less accumulated depreciation 246,962 241,331
-------- --------
Net property, plant and equipment 135,363 134,401
-------- --------
DEFERRED INCOME TAXES 32,924 29,924
OTHER ASSETS 33,520 33,011
-------- --------
Total Assets $470,527 $459,360
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 31,782 $ 32,365
Long-term debt - current portion 2,376 2,737
Income taxes 9,554 5,613
Other current liabilities 32,427 34,085
-------- --------
Total current liabilities 76,139 74,800
-------- --------
LIABILITIES SUBJECT TO COMPROMISE 1,656,558 1,656,563
LONG-TERM DEBT - less current portion 21,110 21,712
POSTRETIREMENT BENEFITS OTHER THAN PENSIONS 20,459 20,209
OTHER LONG TERM LIABILITIES 2,915 3,282
-------- --------
Total liabilities 1,777,181 1,776,566
--------- ---------
SHAREHOLDERS' EQUITY (DEFICIT)
Common shares - par value $1.25 per share
authorized 30,000,000 shares, issued
11,125,000 shares 13,906 13,906
Additional paid-in capital 36,378 36,378
Foreign currency translation (197) 290
Accumulated deficit (1,354,828) (1,365,867)
--------- ---------
(1,304,741) (1,315,293)
</TABLE>
4
<PAGE> 5
<TABLE>
<CAPTION>
EAGLE-PICHER INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEET
(Dollars in thousands)
Feb. 28 Nov. 30
1994 1993
-------- --------
<S> <C> <C>
Less cost of 84,068 common treasury shares $ (1,913) $ (1,913)
-------- --------
Total Shareholders' Equity (Deficit) (1,306,654)(1,317,206)
--------- ---------
Total Liabilities and Shareholders' Equity
(Deficit) $470,527 $459,360
======== ========
<FN>
See accompanying notes to the consolidated financial statements.
</TABLE>
5
<PAGE> 6
<TABLE>
<CAPTION>
EAGLE-PICHER INDUSTRIES, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(Dollars in thousands)
Three Months Ended
February 28
------------------
1994 1993
---- ----
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $11,039 $(6,194)
Adjustments to reconcile net income (loss)
to net cash provided by (used in)
operating activities:
Depreciation and amortization 6,333 6,041
Cumulative effect of accounting change - 12,598
Changes in assets and liabilities:
Receivables (3,947) (2,706)
Inventories (752) (2,542)
Accounts payable (583) (2,238)
Accrued liabilities (1,658) (1,235)
Other (1,088) 1,595
------- -------
Net cash provided by
operating activities before
reorganization activities 9,344 5,319
Changes in liabilities from
reorganization activities:
Accounts payable - 226
Accrued liabilities - (156)
------- --------
Net cash provided by
operating activities 9,344 5,389
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from disposal of fixed assets 44 28
Capital expenditures (7,315) (5,482)
Other (430) (625)
------- --------
Net cash used in
investing activities (7,701) (6,079)
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of long-term debt - 146
Reduction of long-term debt (935) (1,454)
Issuance of common shares - 156
------- --------
Net cash used in
financing activities (935) (1,152)
</TABLE>
6
<PAGE> 7
<TABLE>
EAGLE-PICHER INDUSTRIES, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(Dollars in thousands)
<CAPTION>
Three Months Ended
February 28
--------------------
1994 1993
---- ----
<S> <C> <C>
Net increase (decrease) in cash and cash equivalents 708 (1,842)
Cash and cash equivalents, beginning of period 84,574 78,116
-------- --------
Cash and cash equivalents, end of period $ 85,282 $ 76,274
======== ========
Supplemental cash flow information:
Cash paid during the year:
Interest paid $ 541 $ 383
Income taxes paid (net of refunds received) $ 431 $ 287
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
7
<PAGE> 8
EAGLE-PICHER INDUSTRIES, INC.
Notes to Consolidated Financial Statements
A. PROCEEDINGS UNDER CHAPTER 11
----------------------------
On January 7, 1991 (the "petition date"), Eagle-Picher Industries, Inc.
(the "Company") and seven of its domestic subsidiaries each filed a voluntary
petition for relief under chapter 11 of the United States Bankruptcy Code
("chapter 11") in the United States Bankruptcy Court for the Southern District
of Ohio, Western Division, in Cincinnati, Ohio (the "Bankruptcy Court"). Each
filing entity is currently operating its business as a debtor in possession in
accordance with the provisions of the Bankruptcy Code.
The chapter 11 filings were the consequence of a cash shortfall resulting
from the Company's inability to satisfy certain immediate asbestos litigation
liabilities. As a result of the chapter 11 filings, substantially all
litigation pending against the Company as of the petition date is stayed and no
party may take any action to recover a pre-petition claim, except pursuant to
further order of the Bankruptcy Court.
An Unsecured Creditors' Committee, an Injury Claimants' Committee ("ICC"),
an Equity Security Holders' Committee, and a Legal Representative for Future
Claimants ("RFC") have been appointed in the chapter 11 cases. An unofficial
asbestos co-defendants' committee has also been participating in the chapter 11
cases. In accordance with the provisions of the Bankruptcy Code, these parties
have the right to be heard with respect to transactions outside the ordinary
course of business. The official committees and the RFC are the primary
parties with whom the Company is negotiating the terms of a plan of
reorganization. In June 1992, a mediator was appointed by the Bankruptcy Court
to assist the constituencies in their negotiations.
The Bankruptcy Court established a bar date of October 31, 1991 for all
pre-petition claims against the Company other than those arising from the sale
of asbestos-containing products. The bar date is the date by which claimants
who disagree with the amounts recorded as owed to them by the Company must file
a proof of claim against the Company. Substantially all of the general claims
filed by vendors, note holders and other miscellaneous parties pursuant to this
bar date have been reconciled by the Company. The reconciled claims have been
allowed as pre-petition claims against the Company's estate. A small number
of such claims remains to be resolved; however, the Company does not expect the
effect of their resolution to be material. In addition, the Bankruptcy Court
established a bar date of September 30, 1992 for all present asbestos-related
claims. See Note C below for further information about asbestos-related
claims.
On November 9, 1993, the Company reached an agreement on the principal
elements of a joint plan of reorganization that provides a basis for the
Company and its subsidiaries to emerge from chapter 11. The agreement is with
the ICC and the RFC, the representatives of the holders of present and future
asbestos-related and other toxic tort claims in the Company's chapter 11 case,
and was reached with the assistance of the mediator appointed by the Bankruptcy
Court.
The agreement contemplates a settlement of the Company's liability for all
present and future asbestos-related personal injury claims. These claims would
be channeled to and resolved by a claims administration trust that would
receive cash, debt securities and substantially all of the common stock of the
reorganized Company under a plan of reorganization (the "Plan"). As a
consequence of the proposed settlement, the Company recorded a provision in the
fourth quarter of 1993 of $1.135 billion to increase the asbestos liability
subject to compromise to $1.5 billion.
8
<PAGE> 9
The Company also recorded a provision of $41.4 million in 1993 for
environmental and other litigation claims in anticipation of settlement of such
claims.
Liabilities incurred by the Company as of the petition date and subject to
compromise under a plan of reorganization are separately classified in the
Consolidated Balance Sheet and include the following (in thousands of dollars):
<TABLE>
<CAPTION>
February 28 November 30,
1994 1993
---- ----
<S> <C> <C>
Asbestos liability $1,500,024 $1,500,029
Long-term debt (unsecured portion) 62,004 62,004
Accounts payable 43,135 43,135
Accrued and other liabilities 51,395 51,395
--------- ---------
$1,656,558 $1,656,563
========= =========
</TABLE>
The accompanying consolidated financial statements have been prepared on a
going concern basis which contemplates continuity of operations, realization of
assets and liquidation of liabilities in the ordinary course of business. The
liabilities subject to compromise listed above have been reported on the basis
of the expected amount of the allowed claims even though they may be settled
for lesser amounts. Upon confirmation of a plan of reorganization, the Company
would utilize the fresh-start reporting principles contained in the AICPA's
Statement of Position 90-7, which would result in adjustments relating to the
amounts and classification of recorded assets and liabilities, determined as of
the plan confirmation date. At this date, because no plan of reorganization
has been filed with the Bankruptcy Court, the Company cannot be certain of the
terms and provisions thereof. However, the Company believes that the ultimate
consideration to be received by the unsecured creditors will be substantially
less than the amounts shown in the accompanying Consolidated Balance Sheet.
The agreement on the principal elements of a joint plan of reorganization
discussed above provides that the Company, the ICC and the RFC will negotiate
with the Unsecured Creditors' Committee and the Equity Security Holders'
Committee with the goal of developing a consensual plan of reorganization.
These negotiations have commenced under the direction of the mediator appointed
by the Bankruptcy Court, and the Company intends to proceed with these
negotiations as expeditiously as possible. If such a consensual plan cannot be
achieved, the agreement provides that a plan will be filed under which holders
of pre-petition unsecured claims, other than asbestos, lead and silica-related
claims, will receive 30% of their allowed claims in value, and no distribution
would be made to the Company's existing common shareholders, whose shares would
be canceled. Under the Bankruptcy Code, shareholders are not entitled to any
distribution under a plan of reorganization unless all classes of pre-petition
creditors receive satisfaction in full of their allowed claims or accept a plan
which allows shareholders to participate in the reorganized Company or to
receive a distribution. The treatment under the Plan of asbestos property
damage, lead and silica claims is to be negotiated.
Following the negotiations described above, the Company intends to file a
plan of reorganization with the Bankruptcy Court and proceed to confirmation in
accordance with the provisions of the Bankruptcy Code, including soliciting the
requisite creditor and shareholder acceptances. Implementation of the
agreement and the treatment of claims and interests as provided therein is
subject to confirmation of the Plan in accordance with the provisions of the
Bankruptcy Code.
9
<PAGE> 10
The net expense resulting from the Company's administration of the
chapter 11 cases has been segregated from expenses related to ordinary
operations in the accompanying financial statements and includes the following
(in thousands):
<TABLE>
<CAPTION>
Three Months
Ended
February 28
----------------
1994 1993
---- ----
<S> <C> <C>
Professional fees and other
expenses directly related
to bankruptcy $ 1,672 $ 1,909
Interest income (590) (587)
------ ------
$ 1,082 $ 1,322
====== ======
</TABLE>
Interest income is attributable to the accumulation of cash and short-term
investments subsequent to the petition date.
B. INVESTMENTS
------------
In 1990, the Company received shares of stock in a Canadian mining concern
in settlement of certain indebtedness owed to the Company. The Company had
previously deemed the investment to be permanently impaired and had recorded a
loss in the investment in the amount of its full book value. The price of the
stock, however, has significantly increased recently and at February 28, 1994,
the shares held by the Company had a fair value of approximately $5.3 million.
The Company has not yet adopted Statement of Financial Accounting Standards No.
115, "Accounting for Certain Investments in Debt and Equity Securities." Upon
adoption, this investment would be recorded at its fair value in the
Consolidated Balance Sheet and any unrealized gains or losses would be reported
in a separate component of shareholders' equity until realized.
C. LITIGATION
----------
As discussed in Note L to the 1993 Consolidated Financial Statements, the
accompanying Consolidated Financial Statements include an estimated liability
related to claims associated with the Company's sale of asbestos-containing
insulation products. Litigation with respect to asbestos-related claims was
stayed by reason of the chapter 11 filing.
Many of the asbestos-related claims filed in the chapter 11 case do not
provide sufficient information to enable the Company to determine whether or
not it has liability for the claim or to definitively value any such liability.
Similarly, the Company is not able to project precisely the number and value of
future claims. The Company, however, is certain that it has significant
liability with respect to the 160,000 proofs of claim which were filed against
the Company pursuant to the September 30, 1992 bar date and which allege
asbestos-related personal injury. The Company also is certain that there is
significant liability with respect to future asbestos-related personal injury
claims. After considering the significant costs that likely would be incurred
in litigating the extent and nature of its asbestos-related personal injury
liability, the uncertainty as to the outcome of such an exercise, the need to
conserve the estate's assets for every creditor, and the benefits that would
accrue to the Company's operations, customers, vendors, employees and host
communities from the Company's timely emergence from chapter 11, the Board of
Directors and management concluded that the settlement contemplated by the
agreement on the principal elements of the Plan discussed in this footnote is
in the best interests of the Company. As a consequence of the proposed
settlement, the Company recorded a provision in the fourth quarter of 1993 of
$1.135 billion to increase the asbestos liability subject to compromise to $1.5
billion.
10
<PAGE> 11
There were forty-one lawsuits pending against the Company at the end of
fiscal 1991 resulting from the presence of asbestos-containing products in
buildings. The pending lawsuits typically named numerous defendants, were
filed in both state and federal courts, and were brought by school districts,
cities, states, counties, universities, hospitals, a public library and
commercial building owners. The lawsuits typically demanded compensation for
any costs incurred in identifying, repairing, encapsulating or removing
asbestos-containing products, or sought to have the defendants do these things
directly. Many lawsuits also sought punitive damages. At least three of the
pending cases have been certified as class actions and class certification had
been sought by the plaintiffs in three other cases. Prior to filing its
chapter 11 petition, the Company settled seven building-related cases for less
than $22,000 in the aggregate.
Approximately 1,000 proofs of claim alleging such property damage claims
were filed in the chapter 11 cases pursuant to the bar date. These claims
include most, if not all, of the lawsuits described above that were pending on
the petition date. Many of the other claims also appear to be asserted by
claimants similar to those which had commenced pre-petition lawsuits.
The agreement on the principal elements of the Plan provides that the
treatment under a plan of reorganization of the asbestos property damage claims
asserted against the Company, including both the pre-petition lawsuits and the
proofs of claim filed pursuant to the bar date, will be negotiated with the
assistance of the mediator as discussed above.
In addition, the Company is a defendant in various other litigation which
was pending as of the petition date, which was discussed in Note M to the 1993
Consolidated Financial Statements. The Company intends to defend all
litigation claims vigorously in the manner permitted by the Bankruptcy Code and
applicable law. All pre-petition claims against the Company arising from
litigation must be liquidated or otherwise addressed in the context of the
chapter 11 cases. Further, all such claims against the Company will be
resolved in a plan of reorganization. During the pendency of the chapter 11
cases, any unresolved litigation with respect to pre-petition claims can
proceed against the Company only with the express permission of the Bankruptcy
Court.
The Company has resolved most of the litigation claims that were asserted
pursuant to the October 31, 1991 bar date for claims other than those arising
from the sale of asbestos-containing products. However, several large
litigation claims, environmental claims, and certain lead chemical claims are
still pending. The Company has filed objections to certain of these
litigation-based claims which have not been resolved, seeking to reduce the
amount of such claims or eliminate them entirely. The Company anticipates
filing additional objections to other such claims if they cannot be resolved
through negotiation. These objections will be vigorously litigated by the
Company pursuant to the provisions of the Bankruptcy Code and applicable law.
The eventual outcome of the environmental and other litigation claims
described herein cannot be reasonably predicted due to numerous uncertainties
that are inherent in the reorganization process. However, negotiations
concerning environmental claims and attempts to negotiate settlements of other
litigation claims progressed to a point in 1993 that enabled the Company to
record a provision of $41.4 million for these claims as discussed in Note A.
In addition, the Company may have insurance coverage for certain of these
claims and may have various factual and legal defenses available to it.
D. POSTRETIREMENT BENEFITS OTHER THAN PENSIONS
-------------------------------------------
During the fourth quarter of 1993, the Company adopted Statement of
Financial Accounting Standards No. 106, "Employers' Accounting for
Postretirement Benefits Other Than Pensions," retroactively to December 1,
1992. Besides the cumulative after tax charge of $12.6 million, this
accounting change reduced previously reported income in the first quarter of
1993 by $254,000 or 2 cents per share.
11
<PAGE> 12
E. BASIS OF REPORTING FOR INTERIM FINANCIAL STATEMENTS
---------------------------------------------------
The unaudited financial statements included herein have been prepared by
the Company pursuant to the rules and regulations of the Securities and
Exchange Commission. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally accepted
accounting principles have been omitted pursuant to such rules and regulations,
although the Company believes that the disclosures are adequate to make the
information presented not misleading. These financial statements should be
read in conjunction with the financial statements and notes thereto included in
the Company's Annual Report and Form 10-K for the fiscal year ended November
30, 1993.
The financial statements presented herewith reflect all adjustments
(consisting of normal and recurring accruals) which, in the opinion of
management, are necessary to fairly state the results of operations for the
three month periods ended February 28, 1994 and 1993. Results of operations
for interim periods are not necessarily indicative of results to be expected
for an entire year.
12
<PAGE> 13
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
---------------------------------------------------------------
RESULTS OF OPERATIONS.
----------------------
Sales for the quarter ended February 28, 1994 were $177.8 million compared
with $147.0 million for the first quarter of 1993. Operating income increased
to $13.8 million from $8.4 million for the same period last year. Net income
for the first quarter of 1994 was $11.0 million or $1.00 per share. During the
fourth quarter of 1993, the Company adopted Statement of Financial Accounting
Standards No. 106, "Employers' Accounting for Postretirement Benefits Other
than Pensions," retroactively to December 1, 1992. In addition to the
cumulative aftertax charge of $12.6 million, this accounting change reduced
previously reported income in the first quarter of 1993 by $254,000 or 2 cents
per share.
Results from operations improved significantly with sales increasing by
21% and operating income increasing by nearly two-thirds. Results for the
quarter would have been stronger but extreme winter weather, particularly in
the midwest, adversely affected several Divisions early in the quarter. Demand
for products manufactured by most operations in the Automotive Group was
strong, particularly at the Hillsdale Tool Division and the Wolverine Gasket
Division. Increased market penetration and new products introduced by the
Company's European operations produced improved results despite a continuing
recession in the European automotive market.
In the Machinery Group, the Construction Equipment Division experienced
significant improvement in sales and operating results primarily due to greater
efficiencies and increased shipments. The Division is expected to operate
profitably for the remainder of the year. The Electronics Division experienced
increases in sales and operating income as demand was at a high level for the
Division's line of special purpose batteries for aerospace applications. The
backlog for can washing machinery manufactured by the Cincinnati Industrial
Machinery Division continued to build and results for the quarter were ahead of
those last year.
In the Industrial Group, sales of super-clean containers continued to grow.
These containers, which are totally uncontaminated and conform to strict
Environmental Protection Agency protocols, are essential for environmental
testing. Shipments of isotopically pure boron products for nuclear
applications exceeded last year's first quarter levels.
Interest expense did not change appreciably in the first quarter of 1994
compared to the same period in 1993. Contractual interest on debt outstanding
was $2.3 million in the first quarter of both 1994 and 1993.
Reorganization expenses were $1.1 million in the first quarter of 1994
compared to $1.3 million in the same period of 1993. It is anticipated that
the costs associated with the administration of the chapter 11 cases for the
remainder of 1994 will increase slightly from those of 1993 as negotiations to
achieve a consensual plan of reorganization continue.
Capital expenditures totaled $7.3 million in the first quarter of 1994
compared to $5.5 million in the first quarter of 1993.
13
<PAGE> 14
In terms of the reorganization effort, the Company's goal continues to be
to achieve a consensual plan of reorganization based upon the agreement on the
principal elements of a joint plan of reorganization reached among the Company,
the Injury Claimants' Committee and the Legal Representative for Future
Claimants. This agreement was reached in November 1993 under the auspices of a
mediator appointed by the U. S. Bankruptcy Court. The mediation process
continues in an effort to develop a fully consensual plan of reorganization.
As the Company has previously stated, if a fully consensual plan cannot be
achieved, the agreement provides that a plan will be filed under which holders
of prepetition unsecured claims (other than asbestos, lead, and
silica-related claims) will receive 30 percent of their allowed claims in
value, and no distribution will be made to the existing common shareholders of
the Company and their shares will be canceled. Under the Bankruptcy Code,
shareholders are not entitled to any distribution under a plan of
reorganization unless all classes of pre-petition unsecured creditors receive
satisfaction in full of their allowed claims or accept a plan which allows
shareholders to participate in the reorganized company or to receive a
distribution.
14
<PAGE> 15
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
(a) CHAPTER 11 PROCEEDINGS. Nothing to report.
(b) ASBESTOS. Nothing to report.
(c) OTHER. On March 16, 1994, after the close of the first quarter,
Region VIII of the United States Environmental Protection Agency in Denver,
Colorado served on the Company an Administrative Complaint and Compliance Order
relating to the Company's operation in Colorado Springs, Colorado. The
complaint alleges that in 1989 violations of the Resource Conservation and
Recovery Act occurred, including failure to properly label certain wastes,
improper storage of containers of wastes, and the improper use of waste storage
units. The complaint includes a proposed civil penalty of $402,610.00. The
Company is currently investigating the allegations raised in the complaint.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
The chapter 11 filings constituted a default under substantially all of
the Company's and its affiliates' senior securities. The obligations under the
Company's pre-petition credit facility and other obligations owing to the
lenders who were party to the pre-petition credit facility have been addressed
in the debtor in possession financing agreement approved by the Bankruptcy
Court on May 24, 1991. At that time, certain of such obligations were repaid
and the remaining of such obligations were deemed to be post-petition.
With respect to certain other secured obligations, the Company (or its
affiliates) have been making settlements or "adequate protection" payments
approved by orders of the Bankruptcy Court.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
Exhibits
--------
11 - Calculation of Average Number of Shares
Utilized in Calculating Per-Share Earnings.
15
<PAGE> 16
SIGNATURES
----------
Pursuant to the requirements 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.
EAGLE-PICHER INDUSTRIES, INC.
/s/ David N. Hall
--------------------------------
David N. Hall,
Senior Vice President - Finance and
Chief Financial Officer
DATE April 8, 1994
-----------------
16
<PAGE> 17
EXHIBIT INDEX
-------------
Exhibit No. Description Page
- ----------- ----------- ----
11 Calculation of Average Number 18
of Shares Utilized in Calculating
Per-Share Earnings
17
<PAGE> 1
<TABLE>
EXHIBIT 11
EAGLE-PICHER INDUSTRIES, INC.
CALCULATION OF AVERAGE NUMBER OF SHARES
(Shares in thousands)
<CAPTION>
Three Months Ended
February 28
------------------
1994 1993
---- ----
<S> <C> <C>
Average common shares outstanding 11,125 11,125
Less average common treasury shares 84 126
------ ------
Number of shares for net income
per share 11,041 10,999
====== ======
</TABLE>
18
