<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended March 31, 1996
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Commission file number 1-892
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THE B.F.GOODRICH COMPANY
---------------------------------------------
NEW YORK 34-0252680
- ------------------------------- ----------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3925 EMBASSY PARKWAY, AKRON, OHIO 44333-1799
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 330-374-2000
------------
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
--------- ---------
As of March 31, 1996 there were 52,801,972 shares of common stock outstanding.
There is only one class of common stock.
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PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
THE B.F.GOODRICH COMPANY
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
(Dollars in millions, except per share amounts)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
----------------------
1996 1995
--------- ---------
<S> <C> <C>
Sales $ 604.5 $ 594.0
Operating Costs and Expenses:
Cost of sales 418.2 416.1
Selling and administrative expenses 132.3 130.4
Restructuring costs 4.0 --
--------- ---------
554.5 546.5
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Operating income 50.0 47.5
Interest expense (10.6) (12.4)
Interest income 0.8 0.4
Other expense - net (4.6) (6.9)
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Income before income taxes and Trust distributions 35.6 28.6
Income tax expense (13.1) (11.0)
Distributions on Trust preferred securities (2.6) --
--------- ---------
Net Income 19.9 17.6
Dividends on preferred stock -- (1.9)
--------- ---------
Net income applicable to common stock $ 19.9 $ 15.7
========= =========
Earnings per share $ 0.37 $ 0.30
Weighted average number of common shares outstanding -
in millions 53.3 51.7
Dividends paid per common share $ 0.275 $ 0.275
</TABLE>
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THE B.F.GOODRICH COMPANY
CONSOLIDATED BALANCE SHEET
(Dollars in millions)
<TABLE>
<CAPTION>
March 31, December 31,
1996 1995
------------ ------------
ASSETS (unaudited)
- ------
<S> <C> <C>
Current Assets
Cash and cash equivalents $ 29.1 $ 60.3
Accounts and notes receivable, less allowances
for doubtful receivables (March 31, 1996,
$12.3; December 31, 1995, $11.8) 389.2 399.0
Inventories 401.7 390.1
Deferred income tax assets 67.9 67.9
Prepaid expenses and other assets 38.5 32.7
------------ ------------
Total Current Assets 926.4 950.0
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Property
Land, buildings and machinery and equipment 1,549.6 1,512.7
Allowances for depreciation and amortization (677.0) (653.5)
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Total Property 872.6 859.2
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Deferred Income Tax Assets 20.0 28.3
Goodwill 477.6 481.4
Identifiable Intangible Assets 50.2 51.5
Intangible Pension Asset 42.6 42.6
Other Assets 81.2 76.6
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$ 2,470.6 $ 2,489.6
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
- ------------------------------------
Current Liabilities
Short-term bank debt $ 118.6 $ 11.3
Accounts payable 202.7 235.9
Accrued expenses 232.6 239.9
Income taxes payable 31.6 33.3
Current maturities of long-term debt
and capital lease obligations 69.8 80.3
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Total Current Liabilities 655.3 600.7
------------ ------------
Long-term Debt and Capital Lease Obligations 348.0 422.3
Postretirement Benefits Other Than Pensions 351.9 351.9
Other Non-current Liabilities 101.8 113.9
Mandatorily Redeemable Preferred Securities of Trust 122.3 122.2
Shareholders' Equity
Common Stock - $5 par value
Authorized 100,000,000 shares; issued 53,864,382
shares at March 31, 1996 and 53,578,520
shares at December 31, 1995 269.3 133.9
Additional capital 322.7 447.5
Income retained in the business 366.3 360.9
Cumulative unrealized translation adjustments 6.7 9.6
Amount related to recording minimum pension liability (28.8) (28.8)
Unearned portion of restricted stock awards (15.9) (16.2)
Common stock held in treasury, at cost (1,062,410 shares at March 31, 1996 and
1,045,136 shares at December 31, 1995) (29.0) (28.3)
------------ ------------
Total Shareholders' Equity 891.3 878.6
------------ ------------
$ 2,470.6 $ 2,489.6
============ ============
</TABLE>
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THE B.F.GOODRICH COMPANY
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
(Dollars in millions)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
------------------
1996 1995
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<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income $ 19.9 $ 17.6
Adjustments to reconcile net income to net
cash (used) provided by operating activities:
Depreciation and amortization 29.1 30.4
Deferred income taxes 8.2 3.0
Change in assets and liabilities, net of effects of acquisitions and
dispositions of businesses:
Receivables 8.2 (16.1)
Inventories (12.7) (14.2)
Other current assets (5.3) (0.7)
Accounts payable (35.3) (8.8)
Accrued expenses (6.9) (10.9)
Income taxes payable (1.0) 4.9
Other non-current assets and liabilities (10.6) 11.7
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Net cash (used) provided by operating activities (6.4) 16.9
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property (39.3) (27.8)
Proceeds from sale of property 0.2 0.9
Payments made in connection with acquisitions,
net of cash acquired -- (3.6)
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Net cash used by investing activities (39.1) (30.5)
CASH FLOWS FROM FINANCING ACTIVITIES
Net increase in short-term debt 57.3 50.5
Proceeds from issuance of long-term debt -- 19.0
Repayment of long-term debt and capital lease obligations (34.7) (26.3)
Proceeds from issuance of capital stock 6.5 0.5
Purchases of treasury stock -- (10.4)
Dividends (14.4) (16.2)
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Net cash provided by financing activities 14.7 17.1
EFFECT OF EXCHANGE RATE CHANGES ON CASH (0.4) 1.1
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(DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS (31.2) 4.6
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 60.3 35.8
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CASH AND CASH EQUIVALENTS AT MARCH 31 $ 29.1 $ 40.4
======= =======
Supplemental Cash Flow Information:
Income taxes paid $ 3.0 $ 0.6
======= =======
Interest paid, net of amounts capitalized $ 12.7 $ 16.1
======= =======
</TABLE>
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE A: BASIS OF INTERIM FINANCIAL STATEMENT PREPARATION - The accompanying
unaudited condensed consolidated financial statements of The BFGoodrich Company
(BFGoodrich or Company) have been prepared in accordance with the instructions
to Form 10-Q and do not include all of the information and footnotes required by
generally accepted accounting principles for complete financial statements. In
the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the three months ended March 31, 1996 are not necessarily
indicative of the results that may be achieved for the year ending December 31,
1996. For further information, refer to the consolidated financial statements
and footnotes included in the Company's Annual Report on Form 10-K for the year
ended December 31, 1995.
NOTE B: INVENTORY - Inventories included in the accompanying condensed
consolidated balance sheet consist of:
<TABLE>
<CAPTION>
(Dollars in Millions)
----------------------------
March 31, December 31,
1996 1995
------------ ------------
<S> <C> <C>
FIFO or average cost
(which approximates
current costs):
Finished Products $ 186.5 $ 186.2
In Process 126.8 114.0
Raw Materials & Supplies 153.3 154.3
------------ ------------
466.6 454.5
Reserve to reduce certain
inventories to LIFO (64.9) (64.4)
------------ ------------
Total $ 401.7 $ 390.1
============ ============
</TABLE>
NOTE C: DEBT - During the first quarter of 1996, the Company repaid
approximately $35 million of long-term debt, of which $25 million represented a
scheduled maturity. In April 1996, the Company issued under its existing shelf
registration $20 million of 7.5 percent fixed-rate non-callable MTN notes, due
in 2026. In addition, $50 million of short-term debt classified as non-current
long-term debt at December 31, 1995, has been reclassified as short-term debt at
March 31, 1996.
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NOTE D: STOCK SPLIT - On February 19, 1996, the Company's Board of Directors
approved a two-for-one common stock split in the form of a stock dividend. As a
result of this action, 26,932,191 shares were issued to shareholders of record
on March 11, 1996, of which 531,205 shares represented treasury stock of the
Company. Par value remains at $5 per share as a result of transferring $134.7
million to Common Stock from Additional Capital, representing the aggregate par
value of the shares issued under the stock split. The number of shares and per
share information throughout this Form 10-Q have been restated to reflect the
impact of the common stock split.
NOTE E: CAPITAL STOCK - During the first three months of 1996, 285,862 shares of
authorized but previously unissued shares of common stock were issued under
various employee compensation plans. In addition, 5,800 shares of treasury stock
were issued under a stock award plan and 23,074 unearned shares under this plan
were forfeited and returned to treasury stock.
NOTE F: CONTINGENCIES - There are pending or threatened against BFGoodrich or
its subsidiaries various claims, lawsuits and administrative proceedings, all
arising from the ordinary course of business with respect to commercial, product
liability and environmental matters, which seek remedies or damages. BFGoodrich
believes that any liability that may finally be determined with respect to
commercial and product liability claims, should not have a material effect on
the Company's consolidated financial position or results of operations. The
Company is also involved from time to time in legal proceedings as a plaintiff
involving contract, patent protection, environmental and other matters. Gain
contingencies, if any, are recognized when they are realized.
The Company and its subsidiaries are generators of both hazardous wastes and
non-hazardous wastes, the treatment, storage, transportation and disposal of
which are subject to various laws and governmental regulations. Although past
operations were in substantial compliance with the then-applicable regulations,
the Company has been designated as a potentially responsible party by the U.S.
Environmental Protection Agency in connection with 42 sites, most of which
related to previously discontinued businesses. The Company believes it may have
continuing liability with respect to not more than 25 sites.
A significant portion of accrued environmental liabilities is in connection with
six sites, five of which relate to businesses previously discontinued. Two of
the most significant variables in determining the Company's ultimate liability
are the remediation method finally adopted for the site and the Company's share
of the total site remediation cost. With respect to the five previously
discontinued sites, the Company's maximum percentage share of the ultimate
remediation costs is fixed. Three of the five sites are in the design or
construction phases and two sites are essentially in the maintenance and
operation phase; and, as a result, the remediation plan is generally known.
While reasonable estimates of the ultimate completion cost can be made, the
final cost at completion can vary significantly as a result of changes made
during the construction phase and changed regulatory agency requirements, all of
which are difficult to predict. With respect to the sixth site, the
investigation and determination of remedial alternatives is just beginning, and
it is not currently possible to determine the total cost of remediation or the
Company's share of those future costs. Management believes that it is reasonably
possible that additional environmental costs may be incurred beyond the amounts
accrued as a result of new
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information. However, the amounts, if any, cannot be estimated and management
believes that they would not be material to the Company's financial condition,
but could be material to the Company's results of operations in a given period.
BFGoodrich has tendered the Calvert City chlor-alkali and olefins facilities
(Facilities) to Westlake Monomers Corporation (Westlake) at the February 15,
1993 fair market value of approximately $170.0 million, as determined by an
independent appraiser. Westlake has stated it intends to purchase the Facilities
at the appraised value. Such an acquisition by Westlake is subject to the
negotiation and execution of a definitive purchase agreement and governmental
approval. There can be no assurance that a definitive agreement will be reached.
As of March 31, 1996, the book value of the net assets of the Facilities was
approximately $53 million. In addition, Westlake alleges that, pursuant to the
Right of First Refusal, it is entitled to approximately $325.0 million for lost
profits and opportunity costs due to alleged inability to integrate and expand
its current operations fully, plus interest and attorney fees. BFGoodrich denies
that Westlake is entitled to purchase the Facilities pursuant to the Right of
First Refusal and further denies that Westlake is entitled to any recovery. The
proceedings are currently in arbitration.
NOTE G: OTHER - The Company recognized a pretax charge of $4.0 million in the
first quarter of 1996 for a voluntary early retirement program for eligible
employees of the Specialty Plastics and Specialty Additives Groups.
NOTE H: SUBSEQUENT EVENTS - In April 1996, the Company sold its adhesives
business for approximately $16 million resulting in a pretax gain of
approximately $6.0 million. The adhesives business accounted for approximately 2
percent of the Specialty Chemicals segment's 1995 sales.
On May 1, 1996, the Company contributed $30 million in common stock (754,717
shares) to its qualified defined benefit pension plans.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
POSITION AND RESULTS OF OPERATIONS
----------------------------------
COMPARISON OF THE FIRST QUARTER OF 1996
TO THE FIRST QUARTER OF 1995
----------------------------
TOTAL COMPANY
-------------
Sales in the first quarter of 1996 increased to $604.5 million, or 2 percent
over the same period of 1995, largely due to volume growth, principally in the
Aerospace segment, complemented by higher prices in the Specialty Chemicals
segment. Higher sales in the Company's two strategic segments more than offset
lower sales from Other Operations and lost sales from the divestiture
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<PAGE> 8
of Arrowhead in May 1995.
Cost of sales as a percent of sales in the first quarter of 1996 compared to the
same period of 1995 declined by 0.9 percentage points as a result of lower raw
material costs in the Specialty Chemicals segment and higher capacity
utilization in the Aerospace segment due to volume growth. Total cost of sales
increased to $418.2 million in the first quarter of 1996 from $416.1 million in
the same period of 1995, reflecting internal growth.
Selling and administrative expenses as a percent of sales for the first quarter
of 1996 remained unchanged compared to the corresponding period of 1995. Selling
and administrative expense was $132.3 million for the first quarter of 1996
compared to $130.4 million for the corresponding period last year. The modest
increase reflects increased costs to support the Company's expansion efforts,
particularly in Europe.
The stock contribution to the Company's pension plans discussed in Note H, in
conjunction with planned cash contributions of $38.5 million in 1996, are
expected to result in these pension plans being fully funded on an accumulated
benefit obligation basis by year end. The stock contribution is also expected to
decrease pension expense and is expected to be non-dilutive to earnings per
share for 1996.
SEGMENT ANALYSIS
----------------
<TABLE>
<CAPTION>
Three Months Ended March 31 1996 1995
- --------------------------------------------------------------------------------
(Dollars in Millions)
<S> <C> <C>
Sales:
Aerospace $ 307.0 $ 276.6
Specialty Chemicals 264.3 261.5
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Total Reportable Segments 571.3 538.1
Other Operations 33.2 55.9
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Total $ 604.5 $ 594.0
- --------------------------------------------------------------------------------
Operating Income:
Aerospace $ 39.2 $ 27.8
Specialty Chemicals 18.7 12.0
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Total Reportable Segments 57.9 39.8
Other Operations 4.7 19.4
Corporate (12.6) (11.7)
------- -------
Total $ 50.0 $ 47.5
- --------------------------------------------------------------------------------
</TABLE>
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<PAGE> 9
The Company's operations are classified into two reportable business segments:
BFGoodrich Aerospace (Aerospace) and BFGoodrich Specialty Chemicals (Specialty
Chemicals). Aerospace consists of four business groups: Landing Systems; Sensors
and Integrated Systems; Safety Systems; and Maintenance, Repair and Overhaul
(MRO). They serve commercial, military, regional, business and general aviation
markets. Specialty Chemicals consists of three business groups: Specialty
Additives; Specialty Plastics; and Sealants, Coatings and Adhesives. They serve
various markets, such as personal care, pharmaceuticals, printing, textiles,
automotive, building maintenance and construction. Commencing in the first
quarter of 1996, Aerospace's Test Systems Division has been reclassified from
the MRO Group into the Sensors and Integrated Systems Group to reflect a closer
alignment with similar Aerospace businesses. Comparative segment data has been
reclassified to reflect this change.
Other Operations currently include the manufacture of chlor-alkali and olefins.
Corporate includes general corporate administrative costs and Advanced
Technology Group research expenses. Segment operating income is total segment
revenue reduced by operating expenses directly identifiable with that business
segment. Intersegment eliminations are included in Corporate and are not
significant in any period.
An expanded analysis of sales and operating income by business segment follows.
AEROSPACE
- ---------
SALES BY GROUP (in millions)
<TABLE>
<CAPTION>
Three Months Ended March 31 1996 1995
- --------------------------------------------------------------------------------
<S> <C> <C>
Landing Systems $ 87.5 $ 80.2
Sensors and Integrated Systems 73.2 70.6
Safety Systems 57.4 53.1
MRO 88.9 72.7
- --------------------------------------------------------------------------------
TOTAL $ 307.0 $ 276.6
- --------------------------------------------------------------------------------
</TABLE>
The Aerospace segment achieved record sales in the first quarter of 1996, with
an increase of 11 percent over the same period last year. This growth is
primarily attributable to Aerospace's growing position in the airline
maintenance, repair, and overhaul services market, as well as higher demand for
replacement wheels and brakes products and collision avoidance systems.
The sales growth in the Landing Systems Group reflects increased aftermarket
demand for landing gear, wheels and brakes. Sales growth for wheels and brakes
was particularly evident for the B-747 and A320 commercial aircraft programs and
for various Cessna programs serving the business aircraft markets. Higher spares
sales of landing gear more than offset shortfalls in original equipment
programs.
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<PAGE> 10
The Sensors and Integrated Systems Group sales increased due to stronger demand
for aircraft sensors and higher airline retrofits of flight actuators and fuel
management systems.
The Safety Systems Group sales growth reflected higher demand for collision
avoidance systems and for evacuation systems spares and services.
Strong demand for all MRO Group services produced significant sales growth over
first quarter 1995 levels. The sales growth reflects increasing demand for
Aerospace's comprehensive MRO capabilities.
Record-level Aerospace segment operating income of $39.2 million represented an
increase of 41 percent over the first quarter of 1995 on an 11 percent increase
in sales. Improved operating margins in 1996 reflect higher capacity utilization
arising from volume growth and the successful implementation of productivity and
cost containment initiatives, primarily in the Landing Systems and MRO groups.
SPECIALTY CHEMICALS
- -------------------
SALES BY GROUP (in millions)
<TABLE>
<CAPTION>
Three Months Ended March 31 1996 1995
- --------------------------------------------------------------------------------
<S> <C> <C>
Specialty Plastics $ 71.6 $ 64.4
Specialty Additives 119.3 116.4
Sealants, Coatings and Adhesives 73.4 69.3
Water Systems and Services * -- 11.4
- --------------------------------------------------------------------------------
TOTAL $ 264.3 $ 261.5
- --------------------------------------------------------------------------------
<FN>
* Divested in May 1995
</TABLE>
The Specialty Chemicals segment achieved record first quarter sales this year
with a 6 percent increase over the corresponding period last year after
excluding a divestiture.
The Specialty Plastics Group's 11 percent sales increase in 1996 reflected
strong volume growth in the U.S. for its heat-resistant plastics, aided by the
winter freeze in the southeast region of the country which caused damage to
plumbing piping. A favorable sales mix for the Group's thermoplastic
polyurethane products combined with higher prices more than offset the effect of
a modest decline in volumes. Demand for the relatively new
reaction-injection-molded plastics continues to improve over 1995 levels.
The Specialty Additives Group experienced a modest sales increase over the 1995
first quarter. The 1996 result largely reflects the effects of higher prices and
a favorable sales mix, as volumes for the Group remained consistent with the
year earlier quarter. Volumes in the
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<PAGE> 11
1996 quarter for textiles and coatings products to the automotive sub-markets
were adversely impacted by the General Motors strike.
The Sealants, Coatings and Adhesives Group, which normally has a weak first
quarter because of the seasonality of its construction-related businesses,
recognized a 6 percent sales increase over the first quarter of 1995. The
increase largely reflects higher sales of roofing products and roofing services
in the U.S., and higher sealant sales, primarily in North America.
The segment's operating income of $18.7 million for the first quarter of 1996
was a record despite a $4.0 million charge for a voluntary early retirement
program for eligible employees of the Specialty Plastics and Specialty Additives
Groups. Operating margins improved significantly as a result of higher prices, a
favorable sales mix and lower raw material costs.
OTHER OPERATIONS
----------------
CHLOR-ALKALI & OLEFINS
- ----------------------
First quarter 1996 sales decreased 41 percent to $33.2 million compared to the
same period last year. Operating income decreased from $19.4 million in the
first quarter of 1995 to $4.7 million in 1996. The decreases in sales and
operating income resulted from price and volume reductions in ethylene,
propylene, chlorine and caustic products, reflective of the downturn in that
industry.
CORPORATE
---------
First quarter 1996 Corporate expenses increased to $12.6 million compared to
$11.7 million in the same period last year. This increase is largely
attributable to various employee compensation plans that are based on the
Company's stock price which during the first quarter of 1996 was approximately
70 percent higher than the first quarter of 1995.
INTEREST EXPENSE
----------------
First quarter 1996 interest expense decreased 15 percent to $10.6 million
compared to the same period in 1995 due to lower debt levels and lower cost debt
in 1996.
OTHER EXPENSE - NET
-------------------
Other Expense-Net decreased to $4.6 million in the first quarter of 1996 from
$6.9 million in the same period last year. The reduction reflects lower retiree
health care costs for previously discontinued businesses, lower losses by
investees accounted for under the equity method, and insurance recoveries
related to past environmental claims for previously discontinued businesses.
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<PAGE> 12
INCOME TAXES
------------
For the first quarter of 1996, an income tax provision of $13.1 million was
recorded on pretax income of $35.6 million, an effective tax rate of 36.8
percent. For the same period last year, an income tax provision of $11.0 million
was recorded on pretax income of $28.6 million, an effective tax rate of 38.5
percent. The lower effective tax rate in 1996 reflects the tax benefit of the
Company's QUIPS issued in July 1995, the distributions of which are tax
deductible. For each year, the effective tax rate was higher than the federal
statutory rate principally due to state and local income taxes.
CAPITAL RESOURCES AND LIQUIDITY
-------------------------------
Current assets less current liabilities decreased by approximately $78.0 million
from December 31, 1995 to March 31, 1996, which included a $50 million
reclassification from non-current long-term debt to short-term debt (see note
C). This result reflects the higher working capital usage by the Company's
businesses during the first half of the year. The Company's current ratio
decreased slightly from 1.6X at December 31, 1995 to 1.4X at March 31, 1996. The
quick ratio also decreased from .76X at December 31, 1995 to .64X at March 31,
1996. The Company expects to have adequate cash flow from operations and has the
credit facilities (described in the Company's Annual Report on Form 10-K for the
year ended December 31, 1995) to satisfy its operating requirements, capital
spending programs and to finance growth opportunities as they arise.
In May 1996, the Company expects to file a registration statement with the
Securities and Exchange Commission to increase the limit under the Company's
shelf registration to $300 million for its MTN program.
The Company's debt-to-capitalization ratio of 34.6 percent at March 31, 1996
compared with 33.9 percent at December 31, 1995, is in line with the Company's
long-term target range of 35 to 40 percent.
CASH FLOWS
Cash flow from operating activities in the first quarter of 1996 was
approximately $23 million less than the same period last year, largely due to a
$20 million pension contribution in 1996. No pension contribution was made in
the first quarter of 1995. Operating working capital (defined as accounts
receivable plus pre-LIFO inventory less accounts payable) increased from $608.1
million at March 31, 1995 and $617.6 million at the end of 1995 to $653.1
million at March 31, 1996. Average operating working capital as a percent of
sales was 26.5 percent for the first quarter of 1996, compared to a ratio of
25.0 percent for the same period last year. Higher year-end levels of accounts
payable and higher inventory levels at March 31, 1996 accounted for the increase
in operating working capital. The Company is pursuing initiatives to reduce the
investment in operating working capital. The Company expects to generate
positive cash flow in 1996 after satisfying capital expenditures and payment of
dividends, but
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<PAGE> 13
excluding the effects of acquisitions and divestitures.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Company has signed a consent decree with the U.S. Environmental Protection
Agency providing for the payment of a $450,000 fine relating to the release of
vinyl chloride monomer at the Company's former plant at Henry, Illinois between
July 1989 and August 1991. The consent decree is awaiting approval of the United
States District Court in Peoria, Illinois. The plant in question was operated by
the Company's former Geon Vinyl Division which is now part of an independent
public company, The Geon Company ("Geon"). Geon has assumed all obligations with
respect to this matter.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibit 10(A) - Stock Option Plan. This exhibit was
filed as Appendix B to the Company's 1996 Proxy
Statement dated February 29, 1996 and is
incorporated herein by reference.
Exhibit 10(A)(1) - Form of Stock Option Award is filed as part of
this report.
Exhibit 11 - Statement re Computation of Per Share Earnings is
filed as part of this report.
Exhibit 27 - Financial data schedule.
(b) Reports on Form 8-K - None.
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<PAGE> 14
SIGNATURE
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.
May 7, 1996 The B.F.Goodrich Company
- ----------- ------------------------
/S/D. LEE TOBLER
----------------------------
D. Lee Tobler
Executive Vice President
and Chief Financial Officer
/S/STEVEN G. ROLLS
----------------------------
Steven G. Rolls
Vice President & Controller
(Chief Accounting Officer)
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<PAGE> 1
EXHIBIT 10(A)(1)
January 2, 1996
1~
Dear 2~:
STOCK OPTION AGREEMENT
----------------------
THIS STOCK OPTION AGREEMENT CONSTITUTES PART OF THE PROSPECTUS COVERING
SECURITIES REGISTERED UNDER THE SECURITIES ACT OF 1933.
Section 1. The Key Employees' Stock Option Plan (hereinafter called
the "Plan"), was originally adopted by the Board of Directors and the
shareholders of the Company in 1947, and was most recently reauthorized by the
shareholders on April 15, 1991, and amended by the Board of Directors on June
3, 1991.
The Compensation Committee of the Board of Directors has granted to
you, as of January 2, 1996, options to purchase 3~ shares of common stock of
the Company at a price of $68.75 per share, upon the terms and conditions set
forth in this letter and the Plan. This option price represents 100% of the
fair market value of the common stock on the date of grant, as calculated under
the Plan.
Of the options granted to you, 4~ are INCENTIVE STOCK OPTIONS, and 5~
are NON-INCENTIVE STOCK OPTIONS.
All of the options granted to you shall become exercisable on January
2, 1996, and subject to the terms and conditions of this letter, shall remain
exercisable through January 1, 2006.
The incentive stock options granted to you shall be reclassified as
non-incentive stock options if they are not exercised within three months after
termination of your employment for any reason, including early or normal
retirement, except permanent or total disability as described in Section 7, in
which case reclassification shall occur one year after disability, or death, in
which case reclassification will not occur.
<PAGE> 2
This option may be exercised by you, subject to the further provisions
of this letter, at any time, but in no event later than January 1, 2006.
This grant and exercise of this option is subject to the condition
that this option, together with any other options granted on January 2, 1996,
will conform with any applicable provisions of any State or Federal law or
regulation in force either at the time of grant of the option or the exercise
thereof. The Compensation Committee and the Board of Directors reserve the
right pursuant to the condition mentioned in this paragraph to terminate all or
a portion of this option in the event that in the opinion of said Committee and
Board, with the advice of counsel of the Company, this option or the exercise
thereof, together with any other options granted on January 2, 1996, does not
conform with any such applicable State or Federal law or regulation. Your
ability to exercise your options and receive the benefits of such exercise are
further contingent upon your agreement that you will remit to the Company any
taxes which the Company is required by law to collect from you. The Company
reserves the right to deduct from the total number of shares purchased by you
pursuant to the exercise of the options the number of shares the fair market
value of which equals any tax withholding obligation which it has upon your
exercise of the option. The Company also reserves the right to require that
any such taxes be remitted to the Company from the proceeds of the sale of any
stock acquired by you through exercise of the option by any brokerage effecting
such sale.
Section 2. The option hereby granted may be exercised at any time as
to all or any of the shares then purchasable in accordance with Section 1
hereof by payment in full therefor, at the corporate offices of the Company,
either in (a) cash (including checks, bank draft or money order) or (b) by
delivering common stock of the Company owned of record by you, or a combination
of common stock of the Company owned of record by you and cash. The fair
market value of the common stock so delivered shall be the arithmetic mean of
the high and low price of the common stock on the New York Stock Exchange -
Composite Transactions listing on the exercise date. The utilization of common
stock for all or part of the option price shall be subject to rules and
conditions issued by the Board of Directors or Compensation Committee including
but not limited to common stock holding period requirements relating to
pyramiding rules, regulations, principles and practices of the Internal Revenue
Service, the Securities and Exchange Commission and the accounting profession.
Upon receipt of such payment, the Company will issue, sell and deliver fully
paid and nonassessable shares of common stock, having a par value of $5.00 per
share, of the Company in the amount for which payment is so made. As soon as
practicable after such payment, a certificate or certificates representing the
shares of stock so purchased will be issued.
Section 3. This section is applicable only with respect to
non-incentive stock options.
(a) As an alternative to the exercise provisions contained in Section
2 above, you may under certain limited conditions hereinafter set forth, elect
to surrender and terminate the option granted herein as to all or any of the
shares then purchasable in accordance with Sections 1 and 12 hereof and receive
cash from the Company.
(b) A written application containing an election to exercise this
Section 3 alternative must be submitted to the Secretary of the Company, or his
or her designee during the period which commences on the date on which a
"Change in Control", as defined in the Plan, occurs and ends on the 60th day
thereafter. Notwithstanding the foregoing, however, if a Change in Control
occurs
<PAGE> 3
within six months after the date on which this option was granted, then the
period during which this Section 3 alternative may be exercised shall commence
on the first day after six months have elapsed from the date on which this
option was granted, and shall end on the 60th day thereafter.
(c) The amount of cash paid upon exercise of this Section 3
alternative shall equal the total number of option shares surrendered
multiplied by the amount by which the fair market value of a share of the
Company's common stock on the date of exercise exceeds the option price. The
fair market value of common stock, for purposes of this paragraph, shall be the
arithmetic mean of the high and low prices of the common stock as reported on
the New York Stock Exchange-Composite Transactions listing (or similar report)
on the exercise date as determined in this Section 3(c), or, if no sale was
made on such date, then on the next preceding day on which a sale was made.
(d) An exercise of this Section 3 alternative that not does not occur
within a period described in Section 3(b) shall be invalid.
Section 4. You are required to notify the Secretary of the Company,
or his designee, in the event you dispose of any of the shares acquired as a
result of the exercise of any incentive stock option granted to you hereunder
within two (2) years from the date of this option letter or within one (1) year
from the date upon which such shares were acquired by you through the exercise
of this option.
Section 5. The option hereby granted is personal to you and is not
assignable except as otherwise provided in Section 8 hereof.
Section 6. If your employment with the Company or a subsidiary of the
Company terminates prior to January 1, 2006, by reason of normal or early
retirement, as provided in the Company's Retirement Program For Salaried
Employees (or as provided in a subsidiary company's salaried pension plan in
the event your benefits are received solely from the subsidiary's plan) in
effect at the time of your retirement, your privilege to purchase shares may be
exercised by you at any time but in no event later than the expiration date of
your option.
Section 7. If your employment with the Company or a subsidiary
company terminates prior to January 1, 2006 by reason of permanent and total
disability, determined on the basis of medical evidence satisfactory to the
Company, your privilege to purchase shares may be exercised by you at any time
within three years of disability, but in no event later than the expiration
date of your option, and thereafter shall terminate.
Section 8. If you should die prior to January 1, 2006, your privilege
to purchase shares may be exercised by your executors or administrators at any
time within twelve (12) months of the date of your death, but in no event later
than the expiration date of your option, and thereafter shall terminate.
Section 9. If your employment with the Company or a subsidiary
company terminates for any reason other than death, retirement or permanent and
total disability referred to in Sections 6, 7 and 8 above, your privilege to
purchase shares may be exercised by you at any time within ninety (90) days of
the termination of your employment, but in no event later than the expiration
<PAGE> 4
date of your option, and thereafter shall terminate. This agreement is not
intended to place upon you any obligation to continue, nor to place upon the
Company any obligation to continue you, in the employment of the Company or its
subsidiary and you and the Company shall be free to terminate your employment
as if this agreement had never been made.
Section 10. Subject to the provisions of Sections 11 and 12 hereof,
in case dividends payable in common stock of the Company are declared by the
Company or in case of the subdivision or combination of shares of common stock
of the Company, the number of shares deliverable upon exercise of the privilege
to purchase hereunder shall be increased or decreased proportionately, as the
case may be, and appropriate adjustments in the purchase price shall be made
without change in the aggregate purchase price, all as determined by the Board
of Directors or the Compensation Committee; provided that no fractions of a
share shall be deliverable.
Section 11. Subject to the provisions of Section 12 hereof, in the
event of reorganization, merger or consolidation, in which the Company is the
survivor, the Board of Directors or the Compensation Committee shall have the
right, upon previous written notice to you, to terminate, upon the expiration
of at least thirty (30) days from the date of personal delivery or mailing of
such notice to you, the purchase privilege hereunder as to the shares
undelivered and unpaid for at the time of giving such notice; provided,
however, that prior to the expiration of such period, but in no event later
than January 1, 2006, you may pay for and receive the number of shares which
you were entitled to purchase at the time of giving such notice. The purchase
privilege hereunder as to all shares not so purchased and paid for within such
period shall terminate.
Section 12. In the event of a dissolution or liquidation of the
Company or a merger, consolidation, sale of all or substantially all of its
assets, or other corporate reorganization in which the Company is not the
surviving corporation or any merger in which the Company is the surviving
corporation but the holders of its common stock receive securities of another
corporation, any outstanding options hereunder shall terminate, provided that
you shall, in such event, have the right immediately prior to such dissolution,
liquidation, merger, consolidation, sale of assets or reorganization in which
the Company is not the surviving corporation or any merger in which the Company
is the surviving corporation but the holders of its common stock receive
securities of another corporation, to exercise the unexercised portion of the
option in whole or in part. Nothing herein contained shall prevent the
assumption and continuation of this option or the substitution of a new option
by the surviving corporation.
Section 13. You are not entitled by virtue of your acceptance of this
option letter to any rights of a shareholder of the Company or to notice of
meetings of shareholders or of any other proceedings of the Company.
Section 14. All notices hereunder to the Company shall be delivered
personally or mailed to its corporate offices, attention: Secretary, 3925
Embassy Parkway, Akron, Ohio 44333-1799, and all notices hereunder to you shall
be delivered personally or mailed to you at your address noted above. Such
addresses for the service of notices may be changed at any time provided notice
of such change is furnished in advance to the Company or to you, as the case
may be.
Section 15. This option letter and the terms and conditions herein
set forth are subject in all respects to the terms and conditions of the Plan
as approved by the Board of Directors and
<PAGE> 5
shareholders, which are controlling. All decisions or interpretations of the
Board of Directors and of the Compensation Committee referred to herein shall
be binding and conclusive upon you or upon your executors or administrators
upon any question arising hereunder or under the Plan.
This option letter, when accepted by you, will constitute an agreement
between us as of the date first above written, which shall bind and inure to
the benefit of our respective executors, administrators, successors and
assigns.
Very truly yours,
THE B.F.GOODRICH COMPANY
By___________________________
Vice President
On behalf of the Compensation
Committee of the Board of Directors
Accepted:
___________________________________1996
(Date)
___________________________________
(Signature)
<PAGE> 6
January 2, 1996
1~
Dear 2~:
STOCK OPTION AGREEMENT
----------------------
THIS STOCK OPTION AGREEMENT CONSTITUTES PART OF THE PROSPECTUS COVERING
SECURITIES REGISTERED UNDER THE SECURITIES ACT OF 1933.
Section 1. The Key Employees' Stock Option Plan (hereinafter called
the "Plan"), was originally adopted by the Board of Directors and the
shareholders of the Company in 1947, and was most recently reauthorized by the
shareholders on April 15, 1991, and amended by the Board of Directors on June
3, 1991.
The Compensation Committee of the Board of Directors has granted to
you, as of January 2, 1996, options to purchase 3~ shares of common stock of
the Company at a price of $68.75 per share, upon the terms and conditions set
forth in this letter and the Plan. This option price represents 100% of the
fair market value of the common stock on the date of grant, as calculated under
the Plan.
Of the options granted to you, 4~ are INCENTIVE STOCK OPTIONS, and 5~
are NON-INCENTIVE STOCK OPTIONS.
All of the options granted to you shall become exercisable on January
2, 1996, and subject to the terms and conditions of this letter, shall remain
exercisable through January 1, 2006.
The incentive stock options granted to you shall be reclassified as
non-incentive stock options if they are not exercised within three months after
termination of your employment for any reason, including early or normal
retirement, except permanent or total disability as described in Section 6, in
which case reclassification shall occur one year after disability, or death, in
which case reclassification will not occur.
<PAGE> 7
This option may be exercised by you, subject to the further provisions
of this letter, at any time, but in no event later than January 1, 2006.
This grant and exercise of this option is subject to the condition
that this option, together with any other options granted on January 2, 1996,
will conform with any applicable provisions of any State or Federal law or
regulation in force either at the time of grant of the option or the exercise
thereof. The Compensation Committee and the Board of Directors reserve the
right pursuant to the condition mentioned in this paragraph to terminate all or
a portion of this option in the event that in the opinion of said Committee and
Board, with the advice of counsel of the Company, this option or the exercise
thereof, together with any other options granted on January 2, 1996, does not
conform with any such applicable State or Federal law or regulation. Your
ability to exercise your options and receive the benefits of such exercise are
further contingent upon your agreement that you will remit to the Company any
taxes which the Company is required by law to collect from you. The Company
reserves the right to deduct from the total number of shares purchased by you
pursuant to the exercise of the options the number of shares the fair market
value of which equals any tax withholding obligation which it has upon your
exercise of the option. The Company also reserves the right to require that
any such taxes be remitted to the Company from the proceeds of the sale of any
stock acquired by you through exercise of the option by any brokerage effecting
such sale.
Section 2. The option hereby granted may be exercised at any time as
to all or any of the shares then purchasable in accordance with Section 1
hereof by payment in full therefor, at the corporate offices of the Company,
either in (a) cash (including checks, bank draft or money order) or (b) by
delivering common stock of the Company owned of record by you, or a combination
of common stock of the Company owned of record by you and cash. The fair
market value of the common stock so delivered shall be the arithmetic mean of
the high and low price of the common stock on the New York Stock Exchange -
Composite Transactions listing on the exercise date. The utilization of common
stock for all or part of the option price shall be subject to rules and
conditions issued by the Board of Directors or Compensation Committee including
but not limited to common stock holding period requirements relating to
pyramiding rules, regulations, principles and practices of the Internal Revenue
Service, the Securities and Exchange Commission and the accounting profession.
Upon receipt of such payment, the Company will issue, sell and deliver fully
paid and nonassessable shares of common stock, having a par value of $5.00 per
share, of the Company in the amount for which payment is so made. As soon as
practicable after such payment, a certificate or certificates representing the
shares of stock so purchased will be issued.
Section 3. You are required to notify the Secretary of the Company,
or his designee, in the event you dispose of any of the shares acquired as a
result of the exercise of any incentive stock option granted to you hereunder
within two (2) years from the date of this option letter or within one (1) year
from the date upon which such shares were acquired by you through the exercise
of this option.
Section 4. The option hereby granted is personal to you and is not
assignable except as otherwise provided in Section 7 hereof.
Section 5. If your employment with the Company or a subsidiary of the
Company terminates prior to January 1, 2006, by reason of normal or early
retirement, as provided in the Company's Retirement Program For Salaried
Employees (or as provided in a subsidiary company's salaried pension plan in
the event your benefits are received solely from the subsidiary's plan) in
<PAGE> 8
effect at the time of your retirement, your privilege to purchase shares may be
exercised by you at any time but in no event later than the expiration date of
your option.
Section 6. If your employment with the Company or a subsidiary
company terminates prior to January 1, 2006 by reason of permanent and total
disability, determined on the basis of medical evidence satisfactory to the
Company, your privilege to purchase shares may be exercised by you at any time
within three years of disability, but in no event later than the expiration
date of your option, and thereafter shall terminate.
Section 7. If you should die prior to January 1, 2006, your privilege
to purchase shares may be exercised by your executors or administrators at any
time within twelve (12) months of the date of your death, but in no event later
than the expiration date of your option, and thereafter shall terminate.
Section 8. If your employment with the Company or a subsidiary
company terminates for any reason other than death, retirement or permanent and
total disability referred to in Sections 5, 6 and 7 above, your privilege to
purchase shares may be exercised by you at any time within ninety (90) days of
the termination of your employment, but in no event later than the expiration
date of your option, and thereafter shall terminate. This agreement is not
intended to place upon you any obligation to continue, nor to place upon the
Company any obligation to continue you, in the employment of the Company or its
subsidiary and you and the Company shall be free to terminate your employment
as if this agreement had never been made.
Section 9. Subject to the provisions of Sections 10 and 11 hereof, in
case dividends payable in common stock of the Company are declared by the
Company or in case of the subdivision or combination of shares of common stock
of the Company, the number of shares deliverable upon exercise of the privilege
to purchase hereunder shall be increased or decreased proportionately, as the
case may be, and appropriate adjustments in the purchase price shall be made
without change in the aggregate purchase price, all as determined by the Board
of Directors or the Compensation Committee; provided that no fractions of a
share shall be deliverable.
Section 10. Subject to the provisions of Section 11 hereof, in the
event of reorganization, merger or consolidation, in which the Company is the
survivor, the Board of Directors or the Compensation Committee shall have the
right, upon previous written notice to you, to terminate, upon the expiration
of at least thirty (30) days from the date of personal delivery or mailing of
such notice to you, the purchase privilege hereunder as to the shares
undelivered and unpaid for at the time of giving such notice; provided,
however, that prior to the expiration of such period, but in no event later
than January 1, 2006, you may pay for and receive the number of shares which
you were entitled to purchase at the time of giving such notice. The purchase
privilege hereunder as to all shares not so purchased and paid for within such
period shall terminate.
Section 11. In the event of a dissolution or liquidation of the
Company or a merger, consolidation, sale of all or substantially all of its
assets, or other corporate reorganization in which the Company is not the
surviving corporation or any merger in which the Company is the surviving
corporation but the holders of its common stock receive securities of
another corporation, any outstanding options hereunder shall terminate,
provided that you shall, in such event, have the right immediately prior to
such dissolution, liquidation, merger, consolidation, sale of assets or
reorganization in which the Company is not the surviving corporation or any
merger in which the Company is the surviving corporation but the holders of its
common stock receive securities of
<PAGE> 9
another corporation, to exercise the unexercised portion of the option in whole
or in part. Nothing herein contained shall prevent the assumption and
continuation of this option or the substitution of a new option by the
surviving corporation.
Section 12. You are not entitled by virtue of your acceptance of this
option letter to any rights of a shareholder of the Company or to notice of
meetings of shareholders or of any other proceedings of the Company.
Section 13. All notices hereunder to the Company shall be delivered
personally or mailed to its corporate offices, attention: Secretary, 3925
Embassy Parkway, Akron, Ohio 44333-1799, and all notices hereunder to you shall
be delivered personally or mailed to you at your address noted above. Such
addresses for the service of notices may be changed at any time provided notice
of such change is furnished in advance to the Company or to you, as the case
may be.
Section 14. This option letter and the terms and conditions herein
set forth are subject in all respects to the terms and conditions of the Plan
as approved by the Board of Directors and shareholders, which are controlling.
All decisions or interpretations of the Board of Directors and of the
Compensation Committee referred to herein shall be binding and conclusive upon
you or upon your executors or administrators upon any question arising
hereunder or under the Plan.
This option letter, when accepted by you, will constitute an agreement
between us as of the date first above written, which shall bind and inure to
the benefit of our respective executors, administrators, successors and
assigns.
Very truly yours,
THE B.F.GOODRICH COMPANY
By______________________________
Vice President
On behalf of the Compensation
Committee of the Board of Directors
Accepted:
________________________________1996
(Date)
________________________________
(Signature)
<PAGE> 10
January 2, l996
1~
Dear 2~:
STOCK OPTION AGREEMENT
----------------------
THIS STOCK OPTION AGREEMENT CONSTITUTES PART OF THE PROSPECTUS COVERING
SECURITIES REGISTERED UNDER THE SECURITIES ACT OF 1933.
Section 1. The Key Employees' Stock Option Plan (hereinafter called
the "Plan"), was originally adopted by the Board of Directors and the
shareholders of the Company in 1947, and was most recently reauthorized by the
shareholders on April 15, 1991, and amended by the Board of Directors on June
3, 1991.
The Compensation Committee of the Board of Directors has granted to
you, as of January 2, 1996, options to purchase 3~ shares of common stock of
the Company at a price of $68.75 per share, upon the terms and conditions set
forth in this letter and the Plan. This option price represents 100% of the
fair market value of the common stock on the date of grant, as calculated under
the Plan.
All of the options granted to you are INCENTIVE STOCK OPTIONS. The
dates on which the options granted to you become exercisable, and the number of
shares of common stock which become purchasable on each of those dates are as
follows:
<TABLE>
<CAPTION>
Number of Shares Purchasable
----------------------------
<S> <C>
Prior to January 2, 1997 0
January 2, 1997 0 - Incentive Stock Options
January 2, 1998 0 - Incentive Stock Options
January 2, 1999 0 - Incentive Stock Options
</TABLE>
Once exercisable, all options granted hereunder shall, subject to the terms and
conditions of this letter, remain exercisable through January 1, 2006. The
incentive stock options granted to you shall be reclassified as non-incentive
stock options if they are not exercised within three months after termination
of your employment for any reason, including early or normal retirement, except
permanent or total disability as described in Section 6, in which case
reclassification shall occur one year after disability, or death, in which case
reclassification will not occur.
<PAGE> 11
In making this grant to you of the option to purchase shares, the
Committee has taken into account an evaluation of your services based on your
responsibilities and performance and your potential future value to the
Company. In the event, however, that in the opinion of the Board of Directors
or the Compensation Committee (and such opinion shall be conclusive in the
matter) there should be at any time or times hereafter during the period of the
option a change in the evaluation of your services and such responsibilities,
performance, or potential future value, the Board of Directors or the
Compensation Committee shall have the right thereafter to terminate, upon such
future date as may be specified in a written notice mailed or personally
delivered to you, the option hereunder as to all or any part of the shares for
which the applicable installment dates shall not have occurred on or prior to
the date specified in such notice. The option as to any shares not so
terminated may be exercised by you, subject to the further provisions of this
letter, at any time on or after their applicable installment dates, but in no
event later than April 21, 2006.
This grant and exercise of this option is subject to the condition
that this option, together with any other options granted on April 22, 1996,
will conform with any applicable provisions of any State or Federal law or
regulation in force either at the time of grant of the option or the exercise
thereof. The Compensation Committee and the Board of Directors reserve the
right pursuant to the condition mentioned in this paragraph to terminate all or
a portion of this option in the event that in the opinion of said Committee and
Board, with the advice of counsel of the Company, this option or the exercise
thereof, together with any other options granted as of April 22, 1996, does not
conform with any such applicable State or Federal law or regulation. Your
ability to exercise your options and receive the benefits of such exercise are
further contingent upon your agreement that you will remit to the Company any
taxes which the Company is required by law to collect from you. The Company
reserves the right to deduct from the total number of shares purchased by you
pursuant to the exercise of the options the number of shares the fair market
value of which equals any tax withholding obligation which it has upon your
exercise of the option. The Company also reserves the right to require that
any such taxes be remitted to the Company from the proceeds of the sale of any
stock acquired by you through exercise of the option by any brokerage effecting
such sale.
Section 2. The option hereby granted may be exercised at any time as
to all or any of the shares then purchasable in accordance with Section 1
hereof by payment in full therefor, at the corporate offices of the Company,
either in (a) cash (including checks, bank draft or money order) or (b) by
delivering common stock of the Company owned of record by you, or a combination
of common stock of the Company owned of record by you and cash. The fair
market value of the common stock so delivered shall be the arithmetic mean of
the high and low price of the common stock on the New York Stock
Exchange-Composite Transactions listing on the exercise date. The utilization
of common stock for all or part of the option price shall be subject to rules
and conditions issued by the Board of Directors or Compensation Committee
including but not limited to common stock holding period requirements relating
to pyramiding rules, regulations, principles and practices of the Internal
Revenue Service, the Securities and Exchange Commission and the accounting
profession. Upon receipt of such payment, the Company will issue, sell and
deliver fully paid and nonassessable shares of common stock, having a par value
of $5.00 per share, of the Company in the amount for which payment is so made.
As soon as practicable after such payment, a certificate or certificates
representing the shares of stock so purchased will be issued.
Section 3. You are required to notify the Secretary of the Company,
or his designee, in the event you dispose of any of the shares acquired as a
result of the exercise of any incentive stock option granted to you hereunder
within two (2) years from the date of this option letter or within
<PAGE> 12
one (1) year from the date upon which such shares were acquired by you through
the exercise of this option.
Section 4. The option hereby granted is personal to you and is not
assignable except as otherwise provided in Section 7 hereof.
Section 5. If your employment with the Company or a subsidiary
company terminates prior to April 21, 2006, by reason of retirement at the
Normal Retirement Date or later, as defined in the Company's Retirement Program
For Salaried Employees (or as defined in a subsidiary company's salaried
pension plan in the event your benefits are received solely from the
subsidiary's plan) in effect at the time of your retirement, the number of
shares which were not immediately purchasable pursuant to the schedule
contained in Section 1 at the time of such termination of employment shall
become immediately purchasable by you together with the number of shares that
were purchasable by you under the option at the time of your termination of
employment by reason of retirement at the Normal Retirement Date or later.
Such purchase privilege may be exercised by you at any time but in no event
later than the expiration date of your option. If your employment with the
Company or a subsidiary of the Company terminates prior to the expiration date
of your option by reason of your early retirement as provided under the terms
of The B.F.Goodrich Company Retirement Program For Salaried Employees (or as
defined in a subsidiary company's salaried pension plan in the event your
benefits are received solely from the subsidiary's plan) in effect at the time
of your early retirement, the number of shares purchasable will continue to
become purchasable in accordance with the schedule contained in Section 1 of
the option letter. Such purchase privilege may be exercised by you at any time
but in no event later than the expiration date of your option.
Section 6. If your employment with the Company or a subsidiary
company terminates prior to April 21, 2006 by reason of permanent and total
disability, determined on the basis of medical evidence satisfactory to the
Company, the number of shares which were not immediately purchasable pursuant
to the schedule contained in Section 1 at the time of such termination of
employment shall become immediately exercisable together with the number of
shares that were purchasable by you under the option at the time of your
termination of employment by reason of permanent or total disability. Such
purchase privileges may be exercised by you at any time within three years of
disability, but in no event later than the expiration date of your option, and
thereafter shall terminate.
Section 7. If you should die prior to April 21, 2006, the number of
shares which were not immediately purchasable pursuant to the schedule
contained in Section l at the time of your death shall become immediately
exercisable together with the number of shares which were purchasable by you
under the option at the time of your death. Such purchase privilege may be
exercised by your executors or administrators at any time within twelve (12)
months of the date of your death, but in no event later than the expiration
date of your option, and thereafter shall terminate.
Section 8. If your employment with the Company or a subsidiary
company terminates for any reason other than death, retirement or permanent and
total disability referred to in Sections 5, 6 and 7 above, the option shall be
limited to the number of shares which were immediately purchasable by you at
the time of termination of your employment, and the option as to the remaining
shares shall terminate forthwith. Such limited purchase privileges may be
exercised by you at any time within ninety (90) days of the termination of your
employment, but in no event later than the expiration date of your option, and
thereafter shall terminate. This agreement is not intended to place upon you
any obligation to continue, nor to place upon the Company any
<PAGE> 13
obligation to continue you, in the employment of the Company or its subsidiary
and notwithstanding that some or all of the shares to which your option relates
shall not yet have become purchasable by you in accordance with the terms of
this agreement, you and the Company shall be free to terminate your employment
as if this agreement had never been made.
Section 9. Subject to the provisions of Sections 10 and 11 hereof, in
case dividends payable in common stock of the Company are declared by the
Company or in case of the subdivision or combination of shares of common stock
of the Company, the number of shares deliverable upon exercise of the privilege
to purchase hereunder shall be increased or decreased proportionately, as the
case may be, and appropriate adjustments in the purchase price shall be made
without change in the aggregate purchase price, all as determined by the Board
of Directors or the Compensation Committee; provided that no fractions of a
share shall be deliverable.
Section 10. Subject to the provisions of Section 11 hereof, in the
event of reorganization, merger or consolidation, in which the Company is the
survivor, the Board of Directors or the Compensation Committee shall have the
right, upon previous written notice to you, to terminate, upon the expiration
of at least thirty (30) days from the date of personal delivery or mailing of
such notice to you, the purchase privilege hereunder as to the shares
undelivered and unpaid for at the time of giving such notice; provided,
however, that prior to the expiration of such period, but in no event later
than April 21, 2006, you may pay for and receive the number of shares which you
were entitled to purchase at the time of giving such notice. The purchase
privilege hereunder as to all shares not so purchased and paid for within such
period shall terminate.
Section 11. In the event of a dissolution or liquidation of the
Company or a merger, consolidation, sale of all or substantially all of its
assets, or other corporate reorganization in which the Company is not the
surviving corporation or any merger in which the Company is the surviving
corporation but the holders of its common stock receive securities of another
corporation, any outstanding options hereunder shall terminate, provided that
you shall, in such event, have the right immediately prior to such dissolution,
liquidation, merger, consolidation, sale of assets or reorganization in which
the Company is not the surviving corporation or any merger in which the Company
is the surviving corporation but the holders of its common stock receive
securities of another corporation, to exercise the unexercised portion of the
option in whole or in part without regard to the exercisable date contained in
this option. Nothing herein contained shall prevent the assumption and
continuation of this option or the substitution of a new option by the
surviving corporation. The unexercised portion of this option which is not
exercisable shall become immediately exercisable on the date on which a "Change
in Control Event", as defined in the Plan, occurs.
Section 12. You are not entitled by virtue of your acceptance of this
option letter to any rights of a shareholder of the Company or to notice of
meetings of shareholders or of any other proceedings of the Company.
Section 13. All notices hereunder to the Company shall be delivered
personally or mailed to its corporate offices, attention: Secretary, 3925
Embassy Parkway, Akron, Ohio 44333-1799 and all notices hereunder to you shall
be delivered personally or mailed to you at your address noted above. Such
addresses for the service of notices may be changed at any time provided notice
of such change is furnished in advance to the Company or to you, as the case
may be.
Section 14. This option letter and the terms and conditions herein
set forth are subject in all respects to the terms and conditions of the Plan
as approved by the Board of Directors and
<PAGE> 14
shareholders, which are controlling. All decisions or interpretations of the
Board of Directors and of the Compensation Committee referred to herein shall
be binding and conclusive upon you or upon your executors or administrators
upon any question arising hereunder or under the Plan.
This option letter, when accepted by you, will constitute an agreement
between us as of the date first above written, which shall bind and inure to
the benefit of our respective executors, administrators, successors and
assigns.
Very truly yours,
THE B.F.GOODRICH COMPANY
By:______________________________________
Vice President
On behalf of the Compensation
Committee of the Board of Directors
Accepted:
__________________________________1996
(Date)
__________________________________
(Signature)
<PAGE> 15
January 2, 1996
1~
Dear 2~:
STOCK OPTION AGREEMENT
----------------------
THIS STOCK OPTION AGREEMENT CONSTITUTES PART OF THE PROSPECTUS COVERING
SECURITIES REGISTERED UNDER THE SECURITIES ACT OF 1933.
Section 1. The Key Employees' Stock Option Plan (hereinafter called
the "Plan"), was originally adopted by the Board of Directors and the
shareholders of the Company in 1947, and was most recently reauthorized by the
shareholders on April 15, 1991, and amended by the Board of Directors on June
3, 1991.
The Compensation Committee of the Board of Directors has granted to
you, as of January 2, 1996, options to purchase 3~ shares of common stock of
the Company at a price of $68.75 per share, upon the terms and conditions set
forth in this letter and the Plan. This option price represents 100% of the
fair market value of the common stock on the date of grant, as calculated under
the Plan.
Of the options granted to you, 4~ are INCENTIVE STOCK OPTIONS, and 5~
are NON-INCENTIVE STOCK OPTIONS. The dates on which the options granted to you
become exercisable, and the number of shares of common stock which become
purchasable on each of those dates under each type of option, are as follows:
<TABLE>
<CAPTION>
Number of Shares Purchasable
-----------------------------------
<S> <C> <C>
Prior to January 2, 1997 0 Incentive Stock Options
0 Non-Incentive Stock Options
January 2, 1997 509 Incentive Stock Options
1486 Non-Incentive Stock Options
January 2, 1998 1017 Incentive Stock Options
978 Non-Incentive Stock Options
January 2, 1999 1454 Incentive Stock Options
256 Non-Incentive Stock Options
</TABLE>
Once exercisable, all options granted hereunder shall, subject to the terms and
conditions of this letter, remain exercisable through January 1, 2006. The
incentive stock options granted to you shall be reclassified as non-incentive
stock options if they are not exercised within three months after termination
of your employment for any reason, including early or normal retirement, except
permanent or total disability as described in Section 6, in which case
reclassification shall occur one year after disability, or death, in which case
reclassification will not occur.
<PAGE> 16
In making this grant to you of the option to purchase shares, the
Committee has taken into account an evaluation of your services based on your
responsibilities and performance and your potential future value to the
Company. In the event, however, that in the opinion of the Board of Directors
or the Compensation Committee (and such opinion shall be conclusive in the
matter) there should be at any time or times hereafter during the period of the
option a change in the evaluation of your services and such responsibilities,
performance, or potential future value, the Board of Directors or the
Compensation Committee shall have the right thereafter to terminate, upon such
future date as may be specified in a written notice mailed or personally
delivered to you, the option hereunder as to all or any part of the shares for
which the applicable installment dates shall not have occurred on or prior to
the date specified in such notice. The option as to any shares not so
terminated may be exercised by you, subject to the further provisions of this
letter, at any time on or after their applicable installment dates, but in no
event later than April 21, 2006.
This grant and exercise of this option is subject to the condition
that this option, together with any other options granted on April 22, 1996,
will conform with any applicable provisions of any State or Federal law or
regulation in force either at the time of grant of the option or the exercise
thereof. The Compensation Committee and the Board of Directors reserve the
right pursuant to the condition mentioned in this paragraph to terminate all or
a portion of this option in the event that in the opinion of said Committee and
Board, with the advice of counsel of the Company, this option or the exercise
thereof, together with any other options granted as of April 22, 1996, does not
conform with any such applicable State or Federal law or regulation. Your
ability to exercise your options and receive the benefits of such exercise are
further contingent upon your agreement that you will remit to the Company any
taxes which the Company is required by law to collect from you. The Company
reserves the right to deduct from the total number of shares purchased by you
pursuant to the exercise of the options the number of shares the fair market
value of which equals any tax withholding obligation which it has upon your
exercise of the option. The Company also reserves the right to require that
any such taxes be remitted to the Company from the proceeds of the sale of any
stock acquired by you through exercise of the option by any brokerage effecting
such sale.
Section 2. The option hereby granted may be exercised at any time as
to all or any of the shares then purchasable in accordance with Section 1
hereof by payment in full therefor, at the corporate offices of the Company,
either in (a) cash (including checks, bank draft or money order) or (b) by
delivering common stock of the Company owned of record by you, or a combination
of common stock of the Company owned of record by you and cash. The fair
market value of the common stock so delivered shall be the arithmetic mean of
the high and low price of the common stock on the New York Stock
Exchange-Composite Transactions listing on the exercise date. The utilization
of common stock for all or part of the option price shall be subject to rules
and conditions issued by the Board of Directors or Compensation Committee
including but not limited to common stock holding period requirements relating
to pyramiding rules, regulations, principles and practices of the Internal
Revenue Service, the Securities and Exchange Commission and the accounting
profession. Upon receipt of such payment, the Company will issue, sell and
deliver fully paid and nonassessable shares of common stock, having a par value
of $5.00 per share, of the Company in the amount for which payment is so made.
As soon as practicable after such payment, a certificate or certificates
representing the shares of stock so purchased will be issued.
Section 3. You are required to notify the Secretary of the Company,
or his designee, in the event you dispose of any of the shares acquired as a
result of the exercise of any incentive stock option granted to you hereunder
within two (2) years from the date of this option letter or within
<PAGE> 17
one (1) year from the date upon which such shares were acquired by you through
the exercise of this option.
Section 4. The option hereby granted is personal to you and is not
assignable except as otherwise provided in Section 7 hereof.
Section 5. If your employment with the Company or a subsidiary
company terminates prior to April 21, 2006, by reason of retirement at the
Normal Retirement Date or later, as defined in the Company's Retirement Program
For Salaried Employees (or as defined in a subsidiary company's salaried
pension plan in the event your benefits are received solely from the
subsidiary's plan) in effect at the time of your retirement, the number of
shares which were not immediately purchasable pursuant to the schedule
contained in Section 1 at the time of such termination of employment shall
become immediately purchasable by you together with the number of shares that
were purchasable by you under the option at the time of your termination of
employment by reason of retirement at the Normal Retirement Date or later.
Such purchase privilege may be exercised by you at any time but in no event
later than the expiration date of your option. If your employment with the
Company or a subsidiary of the Company terminates prior to the expiration date
of your option by reason of your early retirement as provided under the terms
of The B.F.Goodrich Company Retirement Program For Salaried Employees (or as
defined in a subsidiary company's salaried pension plan in the event your
benefits are received solely from the subsidiary's plan) in effect at the time
of your early retirement, the number of shares purchasable will continue to
become purchasable in accordance with the schedule contained in Section 1 of
the option letter. Such purchase privilege may be exercised by you at any time
but in no event later than the expiration date of your option.
Section 6. If your employment with the Company or a subsidiary
company terminates prior to April 21, 2006 by reason of permanent and total
disability, determined on the basis of medical evidence satisfactory to the
Company, the number of shares which were not immediately purchasable pursuant
to the schedule contained in Section 1 at the time of such termination of
employment shall become immediately exercisable together with the number of
shares that were purchasable by you under the option at the time of your
termination of employment by reason of permanent or total disability. Such
purchase privileges may be exercised by you at any time within three years of
disability, but in no event later than the expiration date of your option, and
thereafter shall terminate.
Section 7. If you should die prior to April 21, 2006, the number of
shares which were not immediately purchasable pursuant to the schedule
contained in Section 1 at the time of your death shall become immediately
exercisable together with the number of shares which were purchasable by you
under the option at the time of your death. Such purchase privilege may be
exercised by your executors or administrators at any time within twelve (12)
months of the date of your death, but in no event later than the expiration
date of your option, and thereafter shall terminate.
Section 8. If your employment with the Company or a subsidiary
company terminates for any reason other than death, retirement or permanent and
total disability referred to in Sections 5, 6 and 7 above, the option shall be
limited to the number of shares which were immediately purchasable by you at
the time of termination of your employment, and the option as to the remaining
shares shall terminate forthwith. Such limited purchase privileges may be
exercised by you at any time within ninety (90) days of the termination of your
employment, but in no event later than the expiration date of your option, and
thereafter shall terminate. This agreement is not intended to place upon you
any obligation to continue, nor to place upon the Company any
<PAGE> 18
obligation to continue you, in the employment of the Company or its subsidiary
and notwithstanding that some or all of the shares to which your option relates
shall not yet have become purchasable by you in accordance with the terms of
this agreement, you and the Company shall be free to terminate your employment
as if this agreement had never been made.
Section 9. Subject to the provisions of Sections 10 and 11 hereof, in
case dividends payable in common stock of the Company are declared by the
Company or in case of the subdivision or combination of shares of common stock
of the Company, the number of shares deliverable upon exercise of the privilege
to purchase hereunder shall be increased or decreased proportionately, as the
case may be, and appropriate adjustments in the purchase price shall be made
without change in the aggregate purchase price, all as determined by the Board
of Directors or the Compensation Committee; provided that no fractions of a
share shall be deliverable.
Section 10. Subject to the provisions of Section 11 hereof, in the
event of reorganization, merger or consolidation, in which the Company is the
survivor, the Board of Directors or the Compensation Committee shall have the
right, upon previous written notice to you, to terminate, upon the expiration
of at least thirty (30) days from the date of personal delivery or mailing of
such notice to you, the purchase privilege hereunder as to the shares
undelivered and unpaid for at the time of giving such notice; provided,
however, that prior to the expiration of such period, but in no event later
than April 21, 2006, you may pay for and receive the number of shares which you
were entitled to purchase at the time of giving such notice. The purchase
privilege hereunder as to all shares not so purchased and paid for within such
period shall terminate.
Section 11. In the event of a dissolution or liquidation of the
Company or a merger, consolidation, sale of all or substantially all of its
assets, or other corporate reorganization in which the Company is not the
surviving corporation or any merger in which the Company is the surviving
corporation but the holders of its common stock receive securities of another
corporation, any outstanding options hereunder shall terminate, provided that
you shall, in such event, have the right immediately prior to such dissolution,
liquidation, merger, consolidation, sale of assets or reorganization in which
the Company is not the surviving corporation or any merger in which the Company
is the surviving corporation but the holders of its common stock receive
securities of another corporation, to exercise the unexercised portion of the
option in whole or in part without regard to the exercisable date contained in
this option. Nothing herein contained shall prevent the assumption and
continuation of this option or the substitution of a new option by the
surviving corporation. The unexercised portion of this option which is not
exercisable shall become immediately exercisable on the date on which a "Change
in Control Event", as defined in the Plan, occurs.
Section 12. You are not entitled by virtue of your acceptance of this
option letter to any rights of a shareholder of the Company or to notice of
meetings of shareholders or of any other proceedings of the Company.
Section 13. All notices hereunder to the Company shall be delivered
personally or mailed to its corporate offices, attention: Secretary, 3925
Embassy Parkway, Akron, Ohio 44333-1799 and all notices hereunder to you shall
be delivered personally or mailed to you at your address noted above. Such
addresses for the service of notices may be changed at any time provided notice
of such change is furnished in advance to the Company or to you, as the case
may be.
Section 14. This option letter and the terms and conditions herein
set forth are subject in all respects to the terms and conditions of the Plan
as approved by the Board of Directors and
<PAGE> 19
shareholders, which are controlling. All decisions or interpretations of the
Board of Directors and of the Compensation Committee referred to herein shall
be binding and conclusive upon you or upon your executors or administrators
upon any question arising hereunder or under the Plan.
This option letter, when accepted by you, will constitute an agreement
between us as of the date first above written, which shall bind and inure to
the benefit of our respective executors, administrators, successors and
assigns.
Very truly yours,
THE B.F.GOODRICH COMPANY
By:______________________________________
Vice President
On behalf of the Compensation
Committee of the Board of Directors
Accepted:
_______________________________1996
(Date)
_______________________________
(Signature)
<PAGE> 20
January 2, 1996
1~
Dear 2~:
LIMITED STOCK APPRECIATION RIGHT
--------------------------------
THIS AGREEMENT REGARDING LIMITED STOCK APPRECIATION RIGHTS CONSTITUTES PART OF
THE PROSPECTUS COVERING SECURITIES REGISTERED UNDER THE SECURITIES ACT OF 1933.
Section 1. The Key Employees' Stock Option Plan (hereinafter called
the "Plan"), was originally adopted by the Board of Directors and the
shareholders of the Company in 1947, and was most recently reauthorized by the
shareholders on April 15, 1991, and amended by the Board of Directors on June
3, 1991. The Plan authorizes the Board of Directors or a committee of
Directors to grant limited stock appreciation rights (hereinafter sometimes
referred to as "LSAR") in connection with any option granted by the Board of
Directors or a committee of Directors.
The Compensation Committee of the Board of Directors has granted to
you, as of January 2, 1996 an LSAR for 3~ shares of common stock of the Company
at a price equal equal to the option price of the related Incentive Stock
Option granted simultaneously herewith of $68.75. The expiration date of this
LSAR is January 1, 2006. This LSAR shall be subject to the same terms and
conditions set forth for the related Incentive Stock Option granted
simultaneously and shall be exercisable as provided below. This option price
represents 100% of the fair market value of the common stock on the date of
grant as calculated under the Plan.
The grant and exercise of this LSAR are subject to the condition that
this LSAR, together with any other LSARs granted as of January 2, 1996, will
conform with any applicable provisions of any State or Federal law or
regulation in force either at the time of grant of the LSAR or the exercise
thereof. The Compensation Committee and the Board of Directors reserve the
right pursuant to the condition mentioned in this paragraph to terminate all or
a portion of this LSAR, in the event that in the opinion of said Committee and
Board, with the advice of counsel of the Company, this LSAR or the exercise
thereof, or any other LSARs granted as of January 2, 1996, does not conform
with any such applicable State or Federal law or regulation.
<PAGE> 21
Section 2. The LSAR granted hereby may be exercised as hereinafter
provided in Section 3 at any time as to all or any of the shares then
purchasable in accordance with Section 1 of the related Incentive Stock Option
granted simultaneously herewith but in no event later than January 1, 2006
provided, however, that the number of shares subject to this LSAR shall be
reduced by the number of shares which you purchase by exercise of the related
Incentive Stock Option granted simultaneously with this LSAR and shall be
reduced by any other reduction in the number of shares exercisable under such
related Incentive Stock Option in accordance with its terms.
Section 3. The LSAR may be exercised at the time and subject to the
conditions hereinafter set forth. Upon such exercise, the related Incentive
Stock Option granted simultaneously herewith shall be deemed surrendered and
terminated as to all or any of the shares then purchasable in accordance with
Section 1 of the related Incentive Stock Option. Upon exercise, you shall
receive any payment owed to you as a result of the exercise in cash.
(b) A written application containing an election to exercise
this LSAR must be submitted to the Secretary of the Company, or his or her
designee during the period which commences on the date on which a "Change in
Control," as defined in the Plan, occurs and ends on the 60th day thereafter.
Notwithstanding the foregoing, however, if a Change in Control occurs within
six months after the date on which this LSAR was granted, then the period
during which this LSAR may be exercised shall commence on the first day after
six months have elapsed from the date on which this LSAR was granted, and shall
end on the 60th day thereafter.
(c) The amount of cash paid upon exercise of this LSAR shall
equal the total number of the related Incentive Stock Option shares surrendered
multiplied by the amount by which the fair market value of a share of the
Company's common stock on the date of exercise of this LSAR, exceeds the option
price. The fair market value of a share of common stock, for purposes of this
paragraph, shall be the arithmetic mean of the high and low prices of the
common stock as reported on the New York Stock Exchange-Composite Transactions
listing (or similar report) on the exercise date as determined in this Section
3(c), or, if no sale was made on such date, then on the next preceding day on
which a sale was made. The related stock option or portion thereof surrendered
upon the exercise of this LSAR shall cease to be exercisable.
(d) An exercise of this LSAR that does not occur within a
period described in Section 3(b) shall be invalid.
Section 4. The LSAR hereby granted is personal to you and is not
assignable except as otherwise provided in the related Incentive Stock Option
granted simultaneously herewith.
<PAGE> 22
Section 5. This LSAR is exercisable only when the fair market value
of the common stock exceeds the option price of the related Incentive Stock
Option.
Section 6. Except as provided above, all other terms and conditions
of the related Incentive Stock Option granted simultaneously herewith are
incorporated herein and by this reference made a part of this agreement except
that any reference to options, stock options or Incentive Stock Options shall
mean LSAR's.
This LSAR letter, when accepted by you, will constitute an agreement
between us as of the date first above written, which shall bind and inure to
the benefit of our respective executors, administrators, successors and
assigns.
Very truly yours
THE B.F.GOODRICH COMPANY
By_______________________________________
Vice President
On behalf of the Compensation
Committee of the Board of Directors
Accepted:
______________________________1996
(Date)
______________________________
(Signature)
<PAGE> 1
THE B.F.GOODRICH COMPANY
EXHIBIT 11 - STATEMENT RE COMPUTATION OF PER SHARE EARNINGS
(Dollars in millions, except per share amounts)
<TABLE>
<CAPTION>
Three months ended March 31,
-------------------------------
1996 1995
-------------- --------------
<S> <C> <C>
PRIMARY EARNINGS PER SHARE:
Number of Shares:
Average number of common shares outstanding 52,715,733 51,595,218
Effect of dilutive stock options 595,397 65,232
-------------- --------------
Total average number of common and common
equivalent shares outstanding 53,311,130 51,660,450
============== ==============
Income:
Net income $ 19.9 $ 17.6
Dividends on preferred stock -- (1.9)
-------------- --------------
Net income applicable to Common Stock $ 19.9 $ 15.7
============== ==============
Net income per share $ 0.37 $ 0.30
============== ==============
FULLY DILUTED EARNINGS PER SHARE:
Number of Shares:
Average number of common shares
outstanding from above 52,715,733 51,595,218
Effect of dilutive stock options -
based on the treasury method using
last day's market price, if higher
than average market price 683,107 69,570
Average number of shares of Common
Stock issuable if Convertible Preferred
Stock was converted -- --(A)
-------------- --------------
Total average number of common and common
equivalent shares outstanding 53,398,840 51,664,788
============== ==============
Income:
Net income $ 19.9 $ 17.6
Dividends on Preferred Stock -- (1.9)
Restore dividend on Convertible
Preferred Stock -- --(A)
-------------- --------------
Net income applicable to Common Stock $ 19.9 $ 15.7
============== ==============
Net income per share $ 0.37 $ 0.30
============== ==============
<FN>
(A) Anti-Dilutive
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEET AND THE CONSOLIDATED STATEMENT OF INCOME OF THIS FORM
10-Q AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 29,100
<SECURITIES> 0
<RECEIVABLES> 401,500
<ALLOWANCES> 12,300
<INVENTORY> 401,700
<CURRENT-ASSETS> 926,400
<PP&E> 1,549,600
<DEPRECIATION> 677,000
<TOTAL-ASSETS> 2,470,600
<CURRENT-LIABILITIES> 655,300
<BONDS> 348,000
<COMMON> 269,300
122,300
0
<OTHER-SE> 622,000
<TOTAL-LIABILITY-AND-EQUITY> 2,470,600
<SALES> 604,500
<TOTAL-REVENUES> 604,500
<CGS> 418,200
<TOTAL-COSTS> 418,200
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 10,600
<INCOME-PRETAX> 35,600
<INCOME-TAX> 13,100
<INCOME-CONTINUING> 19,900
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 19,900
<EPS-PRIMARY> .37
<EPS-DILUTED> .37
</TABLE>
