<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
/X/ Annual Report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934.
For the fiscal year ended December 31, 1993.
Commission File No. 0-13787
/ / Transition Report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934.
Intermet Corporation
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(Exact name of Registrant as specified in its charter)
Georgia
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(State or other jurisdiction of incorporation or organization)
58-1563873
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(I.R.S. Employer Identification No.)
Suite 1600, 2859 Paces Ferry Road, Atlanta, Georgia 30339
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(404) 431-6000
Name of each exchange on which registered: None
Securities registered pursuant to Section 12(g) of the Act: Common Stock,
$0.10 par value
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 .
--- ---
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein and will not be
contained, to the best of Registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10K. .
----
Aggregate market value of the voting stock held by
nonaffiliates of the Registrant as of March 17, 1994 was $180,798,357 based on
the closing sale price of the Common Stock as quoted on The Nasdaq National
Market, $9.50. See Item 12.
At March 17, 1994 there were 24,580,719 shares of Common
Stock, $0.10 par value, outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Registrant's Annual Report to Shareholders for the fiscal year
ended December 31, 1993 are incorporated by reference into Parts I and II.
Portions of the Registrant's definitive Proxy Statement for the 1994 Annual
Meeting of Shareholders, filed with the Commission, are incorporated by
reference into Part III.
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PART I
ITEM 1. BUSINESS
GENERAL
The Registrant is a leading independent manufacturer of precision
ductile and gray iron castings, with production facilities in North America and
Germany. The Registrant's castings are used primarily in automobiles and light
trucks, as well as in heavy trucks, construction and farm equipment, air
conditioning and refrigeration equipment and internal combustion engines. The
Registrant specializes in safety-related parts critical to vehicle control that
meet its customers' exacting metallurgical, dimensional and quality control
standards. Products manufactured for the automotive, light truck and heavy
truck industries include brake parts, steering components, differential cases,
camshafts and crankshafts. The Registrant provides castings used by over 20
automobile manufacturers throughout the world, including Ford, Chrysler,
General Motors, Volkswagen, BMW and Mercedes-Benz.
As used herein, the term "Registrant" refers collectively to Intermet
Corporation and its subsidiaries, and their respective predecessors, except
where otherwise indicated by context.
RECENT DEVELOPMENTS
On August 30, 1993 the Registrant announced plans to permanently close
its Lower Basin foundry in Lynchburg, Virginia. The Lower Basin foundry had
been operating well below its capacity of 70,000 tons in recent years. The
foundry stopped pouring iron in December 1993 and is expected to close
completely in 1994. The foundry employed approximately 660 people at the time
the closing was announced. Primarily as a result of the decision to close this
foundry, the Registrant recorded a restructuring charge of $24 million in the
third quarter of 1994.
The Board of Directors of the Registrant suspended the regular
quarterly dividend in October 1993 pending an improvement in the Registrant's
operating performance.
PRODUCTS, MARKETS AND SALES
The Registrant specializes in safety-related parts critical to vehicle
control, including brake parts and steering system components, as well as
differential cases, camshafts and crankshafts. The Registrant produces
housings, wheels, brake parts and brackets for the construction and earthmoving
equipment industries. Products for other industries include compressor parts
for refrigeration and air conditioning units, cylinder heads, manifolds, valves
and gears. The Registrant is seeking to expand its products to include
aluminum castings.
The Registrant has had a longstanding quality assurance program and is
committed to maintaining its reputation for high quality products and timely
delivery. For example, the Archer Creek, Radford Shell, New River and Columbus
foundries and the PBM machining facility hold Ford's Q-1 quality award. The
Archer Creek, Radford Shell and Ironton foundries and the Columbus machining
facility hold Chrysler's Pentastar award. Radford Shell also holds the
Caterpillar Certified Supplier award.
The Registrant markets its products exclusively through its own sales
and customer service staff, except in Europe where it also uses independent
sales representatives. The Registrant currently maintains sales offices in
Michigan, Ohio, Virginia and Germany. The Registrant produces principally to
customer order and does not maintain any significant inventory of finished
goods not on order.
The Registrant provides extensive production and technical training to
its sales staff. This technical background enables the sales staff to act as
an effective liaison between customers and the
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Registrant's production personnel and permits the Registrant to offer
customer assistance at the design stage of major casting programs. The
Registrant also employs quality assurance representatives and engineers who
work with customers' manufacturing personnel to detect and avoid potential
problems and to develop new product opportunities for the Registrant. In
addition to working with customer purchasing personnel, the Registrant's sales
engineers confer with design engineers and other technical staff.
During 1991, 1992 and 1993, direct sales to Ford accounted for 20%,
20% and 23%, respectively, direct sales to Chrysler accounted for 23%,
22% and 23%, respectively, and direct sales to General Motors Corporation
accounted for 6%, 10% and 10%, respectively, of the Registrant's consolidated
net sales. The loss of any of these customers or a substantial reduction in
their purchases from the Registrant would have a material adverse effect on the
Registrant. The Registrant's six largest customers accounted for approximately
71%, 73% and 76% of the Registrant's consolidated net sales during 1991, 1992
and 1993, respectively.
The following table sets forth information regarding sales by the
Registrant to customers in these markets during 1991, 1992 and 1993.
<TABLE>
<CAPTION>
1991 1992 1993
-------------- ---------------- --------------
Sales % Sales % Sales %
----- - ----- - ----- -
(Dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
U.S. Passenger cars and light trucks . . . . . . . . . . . . . $188,000 59 $259,800 65 $328,500 74
U.S. Industrial . . . . . . . . . . . . . . . . . . . . . . . . 50,500 16 39,800 10 42,100 9
Foreign passenger cars and light
trucks . . . . . . . . . . . . . . . . . . . . . . . . . . . 81,300 25 102,400 25 73,600 17
-------- -------- --------
Total Sales . . . . . . . . . . . . . . . . . . . . . . . . . . $319,800 $402,000 $444,200
======== ======== ========
</TABLE>
In 1993 reported sales included 381,000 tons of casting shipments. The
Registrant's foundries operated at 82% of average annual capacity during 1993.
MANUFACTURING, MACHINING AND DESIGN
The Registrant produces both ductile and gray iron castings. Gray
iron, the oldest and most widely used cast iron, is readily cast into intricate
shapes that are easily machinable and wear resistant. Ductile iron, which is
produced by removing sulphur from the molten iron and adding magnesium and
other alloys, has greater strength and elasticity than gray iron, and its use
as a higher strength substitute for gray iron and a lower-cost substitute for
steel has grown steadily. For the years ended December 31, 1991, 1992 and
1993, sales of ductile iron castings represented 82%, 85% and 87%,
respectively, of the Registrant's total sales of castings, the balance being
gray iron. The Registrant's castings range in size from small pieces weighing
less than one pound to castings weighing up to 100 pounds.
The manufacturing process involves melting steel scrap and pig iron in
cupola or electric furnaces, adding various alloys and pouring the molten metal
into molds made primarily of sand. The molten metal solidifies and cools in
the molds, and the molds are broken and removed.
Customers usually specify the properties their castings are to embody,
such as hardness and strength, and the Registrant determines how best to meet
those specifications. Constant testing and monitoring of the manufacturing
process is necessary to maintain the quality and performance consistency of the
castings. Electronic testing and monitoring equipment, including x-ray, cobalt
x-ray, ultrasonic
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and magnetic-particle testing equipment, is used extensively in grading scrap
metal, analyzing molten metal and testing castings. The Registrant also uses
its testing equipment and procedures to provide particular tests requested by a
customer for its castings.
Many castings require machining (which may include drilling, threading
or cutting operations) before they can be put to their ultimate use. Most
customers machine their own castings or have them machined by third parties.
The Registrant operates facilities in Columbus, Georgia and Chesterfield,
Michigan, where it machines castings produced by it or by others. The
Registrant also contracts with other companies to machine castings it produces
before shipment to customers.
The Registrant's design and engineering teams assist the customer, when
requested, in the initial stages of product creation and modification. Among
other computer-aided design techniques, the Registrant uses three-dimensional
solid modeling software in conjunction with rapid prototype equipment. This
equipment greatly enhances the Registrant's design flexibility and, depending
on the complexity of the product, can reduce the time required to produce
sample castings for customers by several weeks.
RESEARCH AND DEVELOPMENT
The Registrant conducts process and product development programs,
principally at its separate research and development foundry located adjacent
to the Archer Creek facility in Lynchburg, Virginia, and to a lesser extent at
the laboratories in its other facilities. Current research and testing
projects encompass both new manufacturing processes and product development.
The research foundry has a self-contained melting and molding facility with
complete metallurgical, physical and chemical testing capabilities. The work
on new manufacturing processes is focused on ways to lower costs and improve
quality. Product development work includes projects to enhance existing iron
castings, such as austempering, which enhances the strength and elasticity of
iron, as well as projects to develop new products, such as the conversion of
forgings to castings.
COMPETITION
The Registrant competes with many other foundries, both in the United
States and Europe. Some of these foundries are owned by major users of iron
castings, and a number of foundry operators have, or are subsidiaries of
companies which have, greater financial resources than the Registrant. For
example, the three largest domestic automobile manufacturers, which are among
the Registrant's largest customers, operate their own foundries. However, they
also purchase a significant amount of castings from the Registrant and others,
and there is a trend toward increased outsourcing by the domestic original
equipment manufacturers. Castings produced by the Registrant also compete to
some degree with malleable iron castings, other metal castings and steel
forgings.
The machining industry is highly fragmented and competitive. As in the
foundry industry, large purchasers of machined components often have
significant in-house capabilities to perform their own machining work.
The Registrant competes primarily on the basis of product quality,
engineering, service and price. The Registrant emphasizes its ability to
produce complex, precision-engineered products in order to compete for
value-added castings that generally provide a higher profit margin.
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RAW MATERIALS
The primary raw material used by the Registrant to manufacture iron
castings is steel scrap. The Registrant is not dependent on any single
supplier of scrap. The Registrant has no long-term contractual commitments
with any scrap supplier and does not anticipate any difficulties in obtaining
scrap because of the large number of suppliers and because of the Registrant's
position as a major purchaser. The cost of steel scrap is subject to
fluctuations, but the Registrant has implemented arrangements with most of its
customers for adjusting its castings prices to reflect those fluctuations.
The Registrant has contractual arrangements, which expire at various
times through 1998, for the purchase of various materials, other than steel
scrap, used in or during the manufacturing process. While these contracts and
the Registrant's overall level of purchases provide some protection against
price increases, in most cases the Registrant does not have specific
arrangements in place to adjust its casting prices for fluctuations in the
prices of alloys and other materials.
CYCLICALITY AND SEASONALITY
Most of the Registrant's products are generally not affected by
year-to-year automotive style changes. However, the inherent cyclicality of
the automotive industry has affected the Registrant's sales and earnings during
periods of slow economic growth or recession. For example, North American
automotive production in 1991 was at its lowest level in almost ten years, but
by 1993 had risen more than 20% over the 1991 level. On the other hand, much
of Europe was in a recession during 1993, and automotive production fell
significantly from the previous year. The Registrant's third and fourth
quarter sales are usually lower than first and second quarter sales due to
plant closings by automakers for vacations and model changeovers.
BACKLOG
Most of the Registrant's business involves supplying all or a stated
portion of the customer's annual requirements, generally flexible in amount,
for a particular casting against blanket purchase orders. The lead time and
cost of commencing production of a particular casting tend to inhibit transfers
of production from one foundry to another. Customers typically issue firm
releases and shipping schedules on a monthly basis. The Registrant's backlog
at any given time therefore consists only of the orders which have been
released for shipment. The backlog at December 31, 1993 was approximately $50
million, compared to approximately $44 million at December 31, 1992.
EMPLOYEES
At February 6, 1994, the Registrant employed 4,151 persons, including
3,686 in the United States. Of the persons employed in the United States,
2,885 were hourly manufacturing personnel, and the remainder were clerical,
sales and management personnel. The Registrant employed 465 persons in
Germany, 384 of whom were hourly manufacturing personnel. Most of the
manufacturing personnel are represented by unions under collective bargaining
agreements expiring at various times through 1997. Three domestic bargaining
agreements covering approximately 989 hourly employees expire in 1994. The
Registrant entered into a replacement agreement for one facility, covering 363
employees, in February 1994, and expects to enter into replacement agreements
for the other expiring agreements, as well.
The Registrant from time to time adjusts the size of its work force to
meet fluctuations in production demands at various facilities. During the past
ten years the Registrant has not experienced
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any strike or work stoppage, other than a five-week strike by the 69 covered
employees at the Hibbing, Minnesota plant during 1992. The Registrant believes
that its relationship with its employees is satisfactory.
ENVIRONMENTAL MATTERS
The Registrant's operations are subject to various federal, state and
local laws and regulations relating to the protection of the environment.
These regulations, which are implemented principally by the EPA and
corresponding state agencies, govern the management of solid and hazardous
waste, the discharge of pollutants into the air and into surface and
underground waters, and the manufacture and disposal of chemical substances.
The Registrant believes that current operations of its facilities are in
substantial compliance with applicable environmental laws, regulations and
government orders.
In February 1992 the Registrant's Board of Directors established an
Environmental Compliance Committee to oversee the Registrant's environmental
program. The Registrant has completed internal environmental reviews of all of
its facilities and intends to remedy all non-complying situations. In
addition, the Registrant has increased its environmental compliance staff and
has expanded its training programs to emphasize environmental matters.
The Registrant is currently in the process of attempting to resolve
certain environmental matters with various governmental agencies and third
parties. In addition to the administrative complaint filed by the EPA and the
issue raised by the Ohio Attorney General's Office described in "Item 3 --
Legal Proceedings", these matters include the closure of five former hazardous
waste treatment units at the Archer Creek and Radford Shell facilities, the
remediation of soil and groundwater contamination at the Lower Basin foundries,
and certain other soil remediation and clean-up projects. The Registrant
believes that expenses to be incurred in resolving these matters will not
materially exceed reserves established for such purposes or cause the
Registrant to exceed its level of anticipated capital expenditures. However,
it is not possible to accurately predict such costs.
The recent amendments to the federal Clean Air Act are expected to have
a major impact on the compliance costs of many U.S. companies, including
foundries of the type owned by the Registrant. Until regulations implementing
those amendments are adopted by the federal and state governments, it is not
possible to estimate such costs.
Over the years, the Registrant has landfilled wastes, such as baghouse
dust and foundry sand, on or near its foundry properties. The Registrant
believes its landfills and its other waste management units comply with all
existing regulations. However, it is not possible to predict whether, or to
what extent, future federal, state or local regulations will require the
Registrant to incur additional costs to monitor, close, remediate or otherwise
manage those units in ways not currently contemplated.
FOREIGN OPERATIONS
Information as to revenues, operating profits and identifiable assets
for its foreign operations for 1993, 1992 and 1991 is contained in Note 11 of
the consolidated financial statements included in the Registrant's 1993 Annual
Report to Shareholders included as Exhibit 13 to this Report and is
incorporated herein by reference.
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EXECUTIVE OFFICERS OF THE REGISTRANT
Executive officers are elected by the Board of Directors annually at
its meeting immediately following the Annual Meeting of Shareholders, and hold
office until the next Annual Meeting unless they sooner resign or are removed
from office by the Board of Directors.
The executive officers of the Registrant as of February 10, 1994 and
their ages and principal positions with the Registrant as of that date are as
follows:
<TABLE>
<CAPTION>
Name (Age) Principal Position(s)
---------- ---------------------
<S> <C>
George W. Mathews, Jr (66) Chairman of the Board, Chief
Executive Officer and President
Curtis W. Tarr (69) Vice Chairman of the Board of the Registrant and President,
Intermet International, Inc.
E. A. Bodnar (65) President of Intermet Foundries, Inc.
Thomas J. Trezek (66) Executive Vice President
John D. Ernst (50) Vice President - Finance, Chief Financial Officer and
Secretary - Treasurer
James W. Rydel (49) Vice President - Human Resources
Peter C. Bouxsein (40) Controller
Daryl R. Marsh (55) Vice President
</TABLE>
Mr. Mathews has occupied the positions of Chairman and Chief Executive
Officer of the Registrant since its organization. He became President of the
Registrant in 1991.
Mr. Tarr has served as a director of the Registrant since 1984, Vice
Chairman of the Board of the Registrant since 1992, President of Intermet
International, Inc. since 1991, and a consultant to the Registrant from late
1989 through 1990. He was employed as Dean and professor of the Johnson
Graduate School of Management at Cornell University from 1984 through 1989 and
remained as professor through June 1990.
Mr. Bodnar was Vice President - Foundry Sales of the Registrant from
1987 to 1991, when he became President of Intermet Foundries, Inc. Mr. Bodnar
joined Lynchburg Foundry Company in 1951, and he has held management positions
in Intermet Foundries, Inc. and the Registrant since 1984.
Mr. Trezek has served as Executive Vice President of the Registrant
since February 10, 1994. From 1991 to 1993 he was President of Knight
Facilities Management, a division of Lester B. Knight. He was director of
training and retraining resources at Delta College from 1988 to 1991. From
1987 to 1988 he served as an instructor of management courses at Saginaw Valley
State University and Delta College. Prior to that time he held various
management positions with the Central Foundry Division of General Motors
Corporation.
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Mr. Ernst became Treasurer in 1984 and Secretary of the Registrant in
1986. He was named Vice President - Finance and Chief Financial Officer in
1991.
Mr. Rydel has served as Vice President - Human Resources of the
Registrant since 1991. He served as Director of Compensation and Benefits of
the Registrant from 1986 until 1990, when he became Director of Human Resources
of the Registrant.
Mr. Bouxsein became Controller of the Registrant in 1991. From 1987
until 1991 he was Corporate Director - Financial Reporting of the Registrant.
Mr. Marsh became Vice President of the Registrant in August 1993. From
1969 through 1993, Mr. Marsh was employed by Simpson Industries, Inc., most
recently as Group Vice President, Transmission and Chassis Group.
ITEM 2. PROPERTIES
The Registrant currently owns or operates or has an ownership interest
in 10 ductile and gray iron foundries, one aluminum test foundry and one
research foundry. Most castings can be produced at more than one of the
Registrant's foundries.
The following provides information about the location and capacity of
the iron foundries, all of which are wholly-owned by the Registrant:
<TABLE>
<CAPTION>
Approximate
Name Location Annual Capacity (Tons)
- ---- -------- ----------------------
<S> <C> <C>
Archer Creek Campbell County, Virginia 85,000
Ironton Iron Ironton, Ohio 80,000
Columbus Foundries Columbus, Georgia 72,000
Radford Shell Radford, Virginia 55,000
Columbus Neunkirchen Neunkirchen, Germany 60,000
New River Radford, Virginia 35,000
Lower Basin Green Sand Lynchburg, Virginia 22,000
Lower Basin Shell Lynchburg, Virginia 45,000
Northern Castings Hibbing, Minnesota 14,000
Pennsylvania Castings Landisville, Pennsylvania 10,000
------
Total 478,000
=======
</TABLE>
The Registrant continually reviews the operation of its foundries and
may from time to time close one or more foundries on a permanent or temporary
basis due to its production needs and general business and economic conditions.
The Pennsylvania foundry is currently idled, and the Lower Basin foundries will
be closed in 1994.
The aluminum test foundry is located in Lewisport, Kentucky and is
jointly owned by the Registrant and Comalco Aluminum, Ltd. The research
foundry is located in Virginia and is wholly-owned by the Registrant.
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The Registrant owns or leases several machining and design facilities.
The Registrant owns a 100,000 square foot machining facility in Columbus,
Georgia. The Registrant also has a machining operation housed in a leased
facility containing approximately 200,000 square feet in Chesterfield,
Michigan. InterMotive Technologies, Inc., a subsidiary providing engineering
and design services, operates from a 38,000 square foot leased facility in Van
Buren Township, Michigan.
In addition, the Registrant owns or leases certain executive, sales,
and other management offices, located in Georgia, Michigan, Ohio and Virginia.
The Registrant believes that all of its facilities are well maintained.
The only property of the Registrant which secures long-term
indebtedness is the German foundry, which secures indebtedness with an
aggregate outstanding principal balance at December 31, 1993 of $4,802,000.
See Note 6 to the consolidated financial statements of the Registrant included
in the Registrant's 1993 Annual Report to Shareholders included as Exhibit 13
to this Report for additional information on secured debt.
ITEM 3. LEGAL PROCEEDINGS
Except as set forth below, the Registrant is not aware of any material
pending or threatened legal proceedings to which the Registrant or any of its
subsidiaries is a party or of which any of their property is the subject.
On August 5, 1991 Lynchburg Foundry Company ("Lynchburg"), a
wholly-owned subsidiary of the Registrant, was served with a complaint (the
"Complaint") dated July 31, 1991 by the United States Environmental Protection
Agency (the "EPA"). The Complaint alleges certain violations by Lynchburg of
the Resource Conservation and Recovery Act ("RCRA"), the most significant of
which relates to the treatment of certain hazardous waste at two of Lynchburg's
foundry sites. The EPA initially proposed a civil penalty of $1,514,000, which
Lynchburg appealed. Lynchburg and the EPA have reached an agreement in
principle calling for a penalty of $330,000. The Registrant has made certain
provisions in its consolidated financial statements for the penalty and
remediation costs. Management does not expect this matter to have a material
adverse effect on the Registrant's results of operations or financial
position.
The Registrant has entered into negotiations with the Office of the
Ohio Attorney General with respect to certain past violations by the
Registrant's Ironton, Ohio foundry of Ohio water pollution laws and
regulations. In a letter dated March 15, 1994, the Attorney General's Office
advised the Registrant that the Registrant could avoid litigation with respect
to such violations by entering into a consent order. The Registrant will fully
respond to the Attorney General's letter by mid April 1994 and expects to enter
into a consent order providing for monetary penalties. Management does not
expect this matter to have a material adverse effect on the Registrant's
operations or financial position.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders of the
Registrant during the fourth quarter of the fiscal year covered by this
Report.
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PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
MARKET INFORMATION AND DIVIDENDS
The information contained in Note 12 to the consolidated financial
statements of the Registrant included in the Registrant's Annual Report to
Shareholders for the fiscal year ended December 31, 1993, furnished to the
Commission as Exhibit 13 to this Report, is hereby incorporated herein by
reference.
The Registrant's Common Stock, $0.10 par value, is traded in the
over-the-counter market under the Nasdaq symbol "INMT." As of March 1, 1994,
there were approximately 881 holders of record of the Registrant's Common
Stock.
The Board of Directors of the Registrant suspended payment of the
regular quarterly dividend in October 1993 pending improvement in the
Registrant's operating performance. Even if payment of dividends resumes, the
payment is subject to the discretion of the Board of Directors and will depend
upon the results of operations and financial condition of the Registrant and
other factors the Board of Directors deems relevant. The Registrant is also
subject to restrictions on the payment of dividends under certain loan
agreements. As of December 31, 1993, all of the Registrant's retained earnings
were restricted and unavailable for the payment of dividends under those
agreements.
ITEM 6. SELECTED FINANCIAL DATA
Selected financial data included in the Registrant's 1993 Annual Report
to Shareholders, portions of which are furnished to the Commission as Exhibit
13 to this Report, under the headings "Statement of Operations Data," "Share
Data" and "Balance Sheet Data," are hereby incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATION
The information included under the heading "Discussion of Financial
Information" in the Registrant's 1993 Annual Report to Shareholders, portions
of which are furnished to the Commission as Exhibit 13 to this Report, is
hereby incorporated herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The consolidated financial statements and related notes of the
Registrant and the report of the independent auditors thereon included in the
Registrant's 1993 Annual Report to Shareholders, portions of which are
furnished to the Commission as Exhibit 13 to this Report, are hereby
incorporated herein by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE
Within the 24-month period prior to the date of the Registrant's
financial statements for the fiscal year ended December 31, 1993, the
Registrant did not change auditors and had no disagreement with its auditors on
any matter of accounting principles or practices or financial statement
disclosure.
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PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information contained under the heading "INFORMATION ABOUT NOMINEES
FOR DIRECTORS" in the definitive Proxy Statement used in connection with the
solicitation of proxies for the Registrant's Annual Meeting of Shareholders to
be held April 28, 1994, filed with the Commission, is hereby incorporated
herein by reference. Pursuant to Instruction 3 to Paragraph (b) of Item 401 of
Regulation S-K, information relating to the executive officers of the
Registrant is included in Item 1 of this Report.
ITEM 11. EXECUTIVE COMPENSATION
The information contained under the heading "EXECUTIVE COMPENSATION" in
the definitive Proxy Statement used in connection with the solicitation of
proxies for the Registrant's Annual Meeting of Shareholders to be held April
28, 1994, filed with the Commission, is hereby incorporated herein by
reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The information contained under the heading "VOTING SECURITIES AND
PRINCIPAL HOLDERS" in the definitive Proxy Statement used in connection with
the solicitation of proxies for the Registrant's Annual Meeting of Shareholders
to be held April 28, 1994, filed with the Commission, is hereby incorporated
herein by reference.
For purposes of determining the aggregate market value of the
Registrant's voting stock held by nonaffiliates, shares held by all current
directors and executive officers of the Registrant have been excluded. The
exclusion of such shares is not intended to, and shall not, constitute a
determination as to which persons or entities may be "affiliates" of the
Registrant as defined by the Securities and Exchange Commission.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information contained under the headings "CERTAIN TRANSACTIONS" and
the second paragraph of "COMPENSATION COMMITTEE INTERLOCKS AND INSIDER
PARTICIPATION" in the definitive Proxy Statement used in connection with the
solicitation of proxies for the Registrant's Annual Meeting of Shareholders to
be held April 28, 1994, filed with the Commission, is hereby incorporated
herein by reference.
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PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS
ON FORM 8-K
(a) 1. Financial Statements
The following consolidated financial statements and notes thereto of the
Registrant and its subsidiaries contained in the Registrant's 1993 Annual Report
to Shareholders are incorporated by reference in Item 8 of this Report:
Consolidated Balance Sheets at December 31, 1993 and 1992
Consolidated Statements of Operations for the Years Ended December 31,
1993, 1992 and 1991
Consolidated Statements of Shareholders' Equity for the Years Ended
December 31, 1993, 1992 and 1991
Consolidated Statements of Cash Flows for the Years Ended December 31,
1993, 1992 and 1991
Notes to Consolidated Financial Statements
Report of Independent Auditors
2. Financial Statement Schedules
The following consolidated financial statement schedules for the
Registrant are filed as Item 14(d) hereof, beginning on page F-1.
Consent of Independent Auditors
Schedule II - Amounts Receivable from Related Parties and
Underwriters, Promoters and Employees Other than Related Parties
Schedule V - Property, Plant and Equipment
Schedule VI - Accumulated Depreciation and Amortization of Property,
Plant and Equipment
Schedule VIII - Valuation and Qualifying Accounts
Schedule X - Supplementary Income Statement Information
-12-
<PAGE> 13
3. Exhibits
The following exhibits are required to be filed with this Report by
Item 601 of Regulation S-K:
<TABLE>
<CAPTION>
Exhibit
Number Description of Exhibit
- ------ ----------------------
<S> <C>
3.1 and 4.1 Amended and Restated Articles of Incorporation of the Registrant (included as Exhibit 4.1 to the
Registrant's Form S-3 Registration Statement, filed June 3, 1992, File No. 33-48304, previously filed
with the Commission and incorporated herein by reference).
3.2 and 4.2 By-Laws of the Registrant, as amended.
4.3 Promissory Note of Lynchburg Foundry Company, dated December 1, 1973, payable to Industrial Development
Authority of the City of Lynchburg, Virginia in the original principal amount of $4,400,000.*
4.4 Guaranty Agreement, dated December 1, 1973, by and between The Mead Corporation and the Industrial
Development Authority of the City of Lynchburg, Virginia.*
4.5 Trust Indenture, dated December 1, 1973, by and among Industrial Development Authority of the City of
Lynchburg, Virginia, Lynchburg Foundry Company and United Virginia Bank, as trustee.*
4.6 Promissory Notes of Lynchburg Foundry Company, dated June 1, 1976, payable to Industrial Development
Authority of the City of Lynchburg, Virginia, in the original principal amounts of $2,700,000,
$1,000,000, $550,000 and $550,000, respectively.*
4.7 Guaranty Agreement, dated June 1, 1976, of The Mead Corporation in favor of Industrial Development
Authority of the City of Lynchburg, Virginia.*
4.8 Trust Indenture, dated June 1, 1976, by and among Industrial Development Authority of the City of
Lynchburg, Virginia, Lynchburg Foundry Company and United Virginia Bank, as trustee, with respect to
Pollution Control Revenue Bonds (Mead-Lynchburg Foundry Project), Series 1976, Series 1976A, Series 1976B
and Series 1976C.*
4.9 Loan Contract, dated September 28, 1988, by and between Columbus Neunkirchen Foundry GmbH and
Saarlandische Investitionskreditbank, relating to a loan in the original principal amount of DM 740,000.*
4.10 Loan Contract, dated October 11, 1988, by and between Columbus Neunkirchen Foundry GmbH and the
Landesbank Saar Girozentrale, relating to a loan in the original principal amount of DM 1,550,000.*
4.11 Loan Contract, dated December 14, 1988, by and between Columbus Neunkirchen Foundry GmbH and
Saarlandische Investitionskreditbank, relating to a loan in the principal amount of DM 3,833,500.*
</TABLE>
-13-
<PAGE> 14
<TABLE>
<S> <C>
4.12 Loan Contract, dated January 20, 1982, by and between Columbus Neunkirchen Foundry GmbH and Saarlandische
Investitionskreditbank, relating to a loan in the principal amount of DM 1,450,000.*
4.13 Loan Contract, dated March 1, 1989, by and between Columbus Neunkirchen Foundry GmbH and Saarlandische
Investitionskreditbank, relating to a loan in the principal amount of DM 2,000,000.*
4.14 Loan Contract, dated April 12, 1989, by and between Columbus Neunkirchen Foundry GmbH and Landesbank Saar
Girozentrale, relating to a loan in the principal amount of DM 2,725,000.*
4.15 Loan Contract, dated April 8, 1993, by and between Columbus Neunkirchen Foundry GmbH and IKB
International, relating to a loan in the principal amount of DM 3,000,000.*
4.16 Credit Agreement, dated August 31, 1992, by and among the Registrant, Trust Company Bank, NBD Bank, N.A.,
Wachovia Bank of North Carolina, The First National Bank of Boston, First Union National Bank of Georgia,
NationsBank of North Carolina, N.A., The First National Bank of Louisville, Trust Company Bank, as agent,
and Landesbank Saar Girozentrale, relating to a $75,000,000 and DM 8,000,000 Revolving Credit and Related
Promissory Notes (included as Exhibit 4.16 to the Registrant's Form 10-K for the year ended December 31,
1992, File No. 0-13787, previously filed with the Commission and incorporated herein by reference).
4.17 First Amendment to Credit Agreement dated August 31, 1992, by and among the Registrant, Trust Company
Bank, Landesbank Saar Girozentrale, NBD Bank, N.A., Wachovia Bank of Georgia, N.A., The First National
Bank of Boston, First Union National Bank of Georgia, NationsBank of Georgia, N.A., The First National
Bank of Louisville and Trust Company Bank, as agent, dated December 11, 1992, relating to a $75,000,000
and DM 8,000,000 Revolving Credit (included as Exhibit 4.17 to the Registrant's Form 10-K for the year
ended December 31, 1992, File No. 0-13787, previously filed with the Commission and incorporated herein
by reference).
4.18 Waiver and Second Amendment to Credit Agreement dated August 31, 1992, by and among the Registrant, Trust
Company Bank, Landesbank Saar Girozentrale, NBD Bank, N.A., Wachovia Bank of Georgia, N.A., The First
National Bank of Boston, First Union National Bank of Georgia, NationsBank of Georgia, N.A., The First
National Bank of Louisville and Trust Company Bank, as agent, dated March 19, 1993, relating to a
$75,000,000 and DM 8,000,000 Revolving Credit (included as Exhibit 4.18 to the Registrant's Form 10-K for
the year ended December 31, 1992, File No. 0-13787, previously filed with the Commission and incorporated
herein by reference).
4.19 Waiver and Third Amendment to Credit Agreement dated August 31, 1992, by and among the Registrant, Trust
Company Bank, Landesbank Saar Girozentrale, NBD Bank, N.A., Wachovia Bank of Georgia, N.A., The First
National Bank of Boston, First Union National Bank of Georgia, Nationsbank of Georgia, N.A., National
City Bank, Kentucky, formerly known as The First National Bank of Louisville and Trust Company Bank, as
agent, dated November 15, 1993, relating to a $75,000,000 and DM 8,000,000 Revolving Credit.
4.20 Note Agreement ("Prudential Note Agreement"), dated December 11, 1992, by and between the Registrant and
The Prudential Insurance Company of America, relating to $25,000,000 principal amount of 8.05% Senior
Notes due December 11, 2002 and Related
</TABLE>
-14-
<PAGE> 15
<TABLE>
<S> <C>
Promissory Notes (included as Exhibit 4.19 to the Registrant's Form 10-K for the year ended December 31,
1992, File No. 0-13787, previously filed with the Commission and incorporated herein by reference).
4.21 First Amendment to Prudential Note Agreement, dated March 24, 1993, executed by the Prudential Insurance
Company of America and the Registrant (included as Exhibit 4.20 to the Registrant's Form 10-K for the
year ended December 31, 1992, File No. 0-13787, previously filed with the Commission and incorporated
herein by reference).
4.22 Second Amendment to Prudential Note Agreement, dated November 16, 1993, executed by the Prudential
Insurance Company of America and the Registrant (including form of promissory note entered into in
connection therewith).
10.1 Intermet Corporation Key Individual Stock Option Plan, adopted April 25, 1984 (included as Exhibit 10.1
to the Registrant's registration statement on Form S-14, File No. 2-90815, previously filed with the
Commission and incorporated herein by reference).**
10.2 Amendment No. 1 to the Intermet Corporation Key Individual Stock Option Plan, dated as of August 4, 1988
(included as Exhibit 10.2 to the Registrant's Annual Report on Form 10-K for the fiscal year ended
December 31, 1988, File No. 0-13787, previously filed with the Commission and incorporated herein by
reference).**
10.3 Amendment No. 2 to the Intermet Corporation Key Individual Stock Option Plan, dated October 27, 1988
(included as Exhibit 10.3 to the Registrant's Annual Report on Form 10-K for the fiscal year ended
December 31, 1988, File No. 0-13787, previously filed with the Commission and incorporated herein by
reference).**
10.4 Form of Intermet Corporation Directors Stock Option Agreement (included as Exhibit 10.4 to the
Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1988, File No. 0-13787,
previously filed with the Commission and incorporated herein by reference).**
10.5 Intermet Corporation Directors Stock Option Plan (included as Exhibit 10.6 to the Registrant's Annual
Report on Form 10-K for the fiscal year ended December 31, 1990, File No. 0-13787, previously filed with
the Commission and incorporated herein by reference).**
10.6 Stock Purchase Agreement ("PBM Stock Purchase Agreement"), dated March 30, 1992, by and between the
Registrant, PBM Industries, Inc., Batten Design and Engineering Services, Inc., Wind Point Partners II,
L.P., The Prudential Insurance Company of America, Pruco Life Insurance Company, PruSupply Capital
Assets, Inc., Ingersoll Engineers, Inc. and certain individuals (included as Exhibit 2.1 to the
Registrant's Form 8-K dated March 31, 1992, File No. 0-13787, previously filed with the Commission and
incorporated herein by reference.)
10.7 Promissory Note, dated March 30, 1992, executed by Intermet Machining, Inc. in favor of Wind Point
Partners II, L.P., as Shareholders' Representative, in the principal amount of $438,754.58 (included as
Exhibit 10.7 to the Registrant's Form 10-K for the year ended December 31, 1992, File No. 0-13787,
previously filed with the Commission and incorporated herein by reference).
</TABLE>
-15-
<PAGE> 16
<TABLE>
<S> <C>
10.8 Promissory Note, dated March 30, 1992, executed by Intermet Machining, Inc. in favor of Pruco Life
Insurance Company, in the principal amount of $12,673.31 (included as Exhibit 10.8 to the Registrant's
Form 10-K for the year ended December 31, 1992, File No. 0-13787, previously filed with the Commission
and incorporated herein by reference)
10.9 Promissory Note, dated March 30, 1992, executed by Intermet Machining, Inc. in favor of PruSupply Capital
Assets, Inc., in the principal amount of $114,059.79 (included as Exhibit 10.9 to the Registrant's Form
10-K for the year ended December 31, 1992, File No. 0-13787, previously filed with the Commission and
incorporated herein by reference).
10.10 Promissory Note, dated March 30, 1992, executed by Intermet Machining, Inc. in favor of Wind Point
Partners II, L.P., as Shareholders' Representative, in the principal amount of $1,982,107 (included as
Exhibit 10.10 to the Registrant's Form 10-K for the year ended December 31, 1992, File No. 0-13787,
previously filed with the Commission and incorporated herein by reference).
10.11 Promissory Note, dated March 30, 1992, executed by Intermet Machining, Inc. in favor of Pruco Life
Insurance Company, in the principal amount of $35,240.53 (included as Exhibit 10.11 to the Registrant's
Form 10-K for the year ended December 31, 1992, File No. 0-13787, previously filed with the Commission
and incorporated herein by reference).
10.12 Promissory Note, dated March 30, 1992, executed by Intermet Machining, Inc. in favor of The Prudential
Insurance Company of America, in the principal amount of $317,164.79 (included as Exhibit 10.12 to the
Registrant's Form 10-K for the year ended December 31, 1992, File No. 0-13787, previously filed with the
Commission and incorporated herein by reference).
10.13 Guaranty Agreement, dated March 30, 1992, from Intermet in favor of the shareholders named in the PBM
Stock Purchase Agreement (included as Exhibit 10.13 to the Registrant's Form 10-K for the year ended
December 31, 1992, File No. 0-13787, previously filed with the Commission and incorporated herein by
reference).
10.14(a) Intermet Corporation Employee Stock Ownership Plan and Trust (1987), dated December 19, 1986, by and
between the Registrant and Trust Company Bank, as trustee (included as Exhibit 10.14 to the Registrant's
Form 10-K for the year ended December 31, 1992, File No. 0-13787, previously filed with the Commission
and incorporated herein by reference).**
10.14(b) Amendment No.1 to Intermet Corporation Employee Stock Ownership Plan and Trust (1987), dated October 29,
1987, by and between the Registrant and Trust Company Bank, as trustee (included as Exhibit 10.15 to the
Registrant's Form 10-K for the year ended December 31, 1992, File No. 0-13787, previously filed with the
Commission and incorporated herein by reference).**
10.14(c) Amendment No. 2 to Intermet Corporation Employee Stock Ownership Plan and Trust (1987), dated December
22, 1988, by and between the Registrant and Trust Company Bank, as trustee (included as Exhibit 10.16 to
the Registrant's Form 10-K for the year ended
</TABLE>
-16-
<PAGE> 17
<TABLE>
<S> <C>
December 31, 1992, File No. 0-13787, previously filed with the Commission and incorporated herein by
reference).**
10.14(d) Amendment No. 3 to Intermet Corporation Employee Stock Ownership Plan and Trust (1987), dated June 7,
1989, by and between the Registrant and Trust Company Bank, as trustee (included as Exhibit 10.17 to the
Registrant's Form 10-K for the year ended December 31, 1992, File No. 0-13787, previously filed with the
Commission and incorporated herein by reference).**
10.14(e) Amendment No. 4 to the Intermet Corporation Employee Stock Ownership Plan and Trust (1987), dated October
1, 1993, by and between the Registrant and Trust Company Bank, as trustee.**
10.15 Intermet Corporation 1993 Management Bonus Plan.**
10.16(a) Intermet Corporation Salaried Employees Severance Plan effective as of October 1, 1993.**
10.16(b) Amendment No. 1 to the Intermet Corporation Salaried Employees Severance Plan, dated December 20, 1993.**
10.17 1993 Special Voluntary Severance Plan for Salaried Employees of Intermet Foundries, Inc. and its
subsidiaries.**
10.18 Intermet Salary Continuation Plan (included as Exhibit 10.18 to the Registrant's Form 10-K for the year
ended December 31, 1992, File No. 0-13787, previously filed with the Commission and incorporated herein
by reference).**
10.19(a) Intermet Corporation Savings and Investment Plan and Trust, dated February 8, 1991, by and between the
Registrant and Trust Company Bank, as trustee (included as Exhibit 10.19 to the Registrant's Form 10-K
for the year ended December 31, 1992, File No. 0-13787, previously filed with the Commission and
incorporated herein by reference).**
10.19(b) Amendment No. 1 to the Intermet Corporation Savings and Investment Plan and Trust, dated April 13, 1993,
by and between the Registrant and Trust Company Bank, as trustee.**
10.19(c) Amendment No. 2 to the Intermet Corporation Savings and Investment Plan and Trust, dated October 1, 1993,
by and between the Registrant and Trust Company Bank, as trustee.**
11 Computation of Earnings per Common Share.
13 Annual Report to Shareholders. Certain portions of this Exhibit are incorporated by reference into this
Report on Form 10-K; except as so incorporated by reference, the Annual Report to Shareholders is not to
be deemed filed as part of this Report on Form 10-K.
21 Subsidiaries of the Registrant
23 Consent of Ernst & Young (included herein on Page F-1).
99 Notice of Annual Meeting and Proxy Statement of the Registrant.
- -------------------
*This instrument defines the rights of holders of long-term debt of the Registrant not being registered and the total amount
of securities authorized under the instrument does not exceed ten percent of the total assets of the Registrant and its subsidiaries
on a consolidated basis. This instrument is not being filed, but the Registrant will furnish a copy of this instrument to the
Commission upon request.
**Management contract or compensatory plan or arrangement required to be filed as an exhibit.
</TABLE>
-17-
<PAGE> 18
(b) No current reports on Form 8-K were filed during the fourth quarter
of the Registrant's 1993 fiscal year.
(c) The Registrant hereby files as exhibits to this Report the exhibits
set forth in Item 14(a)3 hereof.
(d) The Registrant hereby files as financial statement schedules to this
Report the financial statement schedules set forth in Item 14(a)2 hereof.
-18-
<PAGE> 19
INDEX TO FINANCIAL STATEMENT SCHEDULES
<TABLE>
<CAPTION>
Item Page
- ---- ----
<S> <C>
Opinion and Consent of Independent Auditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-1
Schedule II - Amounts Receivable from Related Parties and Underwriters,
Promoters and Employees Other than Related Parties . . . . . . . . . . . . . . . . . . . . . . . . F-2
Schedule V - Property, Plant and Equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-3
Schedule VI - Accumulated Depreciation and Amortization of Property, Plant and Equipment . . . . . . . . . F-4
Schedule VIII - Valuation and Qualifying Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-5
Schedule X - Supplementary Income Statement Information . . . . . . . . . . . . . . . . . . . . . . . . . . F-6
</TABLE>
<PAGE> 20
Consent of Independent Auditors
We consent to the incorporation by reference in this Annual Report (Form 10-K)
of Intermet Corporation of our report dated February 9, 1994, included in the
1993 Annual Report to Shareholders of Intermet Corporation.
Our audits also included the financial statement schedules on Intermet
Corporation listed in Item 14(a). These schedules are the responsiblity of the
Company's management. Our responsibility is to express an opinion based on our
audits. In our opinion, the financial statement schedules referred to above,
when considered in relation to the basic financial statements taken as a whole,
present fairly in all material respects the information set forth therein.
We also consent to the incorporation by reference in the Registration
Statements (Form S-8 Nos. 33-58354 and 33-58352) pertaining to the Intermet
Corporation Directors Stock Option Plan and the Intermet Corporation Key
Individual Stock Option Plan of our report dated February 9, 1994, with respect
to the consolidated financial statements incorporated herein by reference, and
our report included in the preceding paragraph with respect to the financial
statement schedules included in this Annual Report (Form 10-K) of Intermet
Corporation.
/s/ Ernst and Young
Atlanta, Georgia
March 29, 1994
F-1
<PAGE> 21
Intermet Corporation
(Consolidated)
Schedule II
Amounts Receivable From Related Parties and Underwriters,
Promoters and Employees Other Than Related Parties
<TABLE>
<CAPTION>
BALANCE AT
BEGINNING OF AMOUNT BALANCE AT
NAME OF DEBTOR PERIOD ADDITIONS COLLECTED END OF PERIOD
- ----------------------------------------------------------------------------------------------------
(In Thousands of Dollars)
<S> <C> <C> <C> <C>
Year ended December 31, 1993:
Eastern Inter-Trans
Services, Inc. $151 $ 7 $20 $138 (a)
==================================================================
Year ended December 31, 1992:
Eastern Inter-Trans
Services, Inc. $143 $ 8 $ - $151 (a)
==================================================================
Year ended December 31, 1991:
Eastern Inter-Trans
Services, Inc. $156 $ 14 $27 $143 (a)
==================================================================
(a) Includes current portion of $138, $151 and $143 in 1993, 1992 and 1991, respectively. At December 31, 1993 the amount owed
had not been paid in accordance with the terms of the note between the Registrant and Eastern Inter-Trans Services, Inc.
</TABLE>
F-2
<PAGE> 22
Intermet Corporation (Consolidated)
Schedule V
Property, Plant and Equipment (Including Foreign Industrial Development Grants,
Net of Amortization)
<TABLE>
<CAPTION>
BALANCE AT
BEGINNING OF ADDITIONS BALANCE AT
CLASSIFICATION PERIOD AT COST RETIREMENTS OTHER END OF PERIOD
- -------------------------------------------------------------------------------------------------------------------------------
(In Thousands of Dollars)
<S> <C> <C> <C> <C> <C>
Year ended December 31, 1993:
Land $ 3,535 $ - $ (6) $ (9) (a) $ 3,520
Building and improvements 64,148 1,677 (1,990) (1,166) (a) 62,669
Machinery and equipment 218,637 20,510 (16,783) (3,631) (a) 218,733
Construction in progress 22,661 21,847 (b) (657) (108) (a) 43,743
-------------------------------------------------------------------------------
$ 308,981 44,034 $(19,436) $(4,914) $328,665
========= ===================================================
Foreign industrial development grants, net (6,118) (457) 918 (c) 382 (a) (5,275)
========= -------- ===================================================
Net additions to property, plant and equipment $43,577
========
Year ended December 31, 1992:
Land $ 3,393 $ 23 $ - $ 119 (a)(b) $ 3,535
Building and improvements 59,051 6,481 (245) (1,139) (a)(b) 64,148
Machinery and equipment 175,442 49,855 (3,572) (3,088) (a)(b) 218,637
Construction in progress 17,883 4,800 (b) - (22) (a) 22,661
-------------------------------------------------------------------------------
$255,769 61,159 $ (3,817) $(4,130) $ 308,981
======== ===================================================
Foreign industrial development grants, net $ (5,735) (1,489) $ 810 (c) $ 296 (a) $ (6,118)
======== -------- ===================================================
Net additions to property, plant and
equipment $59,670
========
Year ended December 31, 1991:
Land $ 2,911 $ 500 $ (15) $ (3) (a) $ 3,393
Building and improvements 56,733 2,923 (297) (308) (a) 59,051
Machinery and equipment 167,060 12,137 (3,556) (199) (a)(d) 175,442
Construction in progress 4,527 10,876 (b) - 2,480 (a)(d) 17,883
-------------------------------------------------------------------------------
$231,231 26,436 $ (3,868) $ 1,970 $ 255,769
======== ===================================================
Foreign industrial development grants, net $ (6,243) (508) $ 821 (c) $ 195 (a) $ (5,735)
======== ------- ===================================================
Net additions to property, plant and equipment $25,928
=======
(a) Effect of foreign currency translation.
(b) Net additions (transfers).
(c) Includes amortization.
(d) Amounts reclassified for assets of Kockums Gjuteri AB transferred to other subsidiaries of the Registrant:
Machinery and equipment $ 578
Construction in progress 2,487
----------------
$3,065
================
</TABLE>
F-3
<PAGE> 23
Intermet Corporation
(Consolidated)
Schedule VI
Accumulated Depreciation and Amortization of Property, Plant and Equipment
<TABLE>
<CAPTION>
BALANCE AT BALANCE AT
BEGINNING OF END OF
CLASSIFICATION PERIOD ADDITIONS RETIREMENTS OTHER PERIOD
- ------------------------------------------------------------------------------------------------------------------------------------
(In Thousands of Dollars)
<S> <C> <C> <C> <C> <C>
Year ended December 31, 1993:
Buildings and equipment $ 23,534 $ 3,425 $ (1,663) $ (225) (a) $ 25,071
Machinery and equipment 116,104 21,444 (13,684) 1,158 (a) (c) 125,022
---------------------------------------------------------------------------------------
$ 139,638 $ 24,869 $ (15,347) $ 933 $ 150,093
=======================================================================================
Year ended December 31, 1992:
Buildings and improvements $ 20,807 $ 3,094 $ (88) $ (279) (a)(b) $ 23,534
Machinery and equipment 101,592 18,896 (2,524) (1,860) (a)(b) 116,104
---------------------------------------------------------------------------------------
$ 122,399 $ 21,990 $ (2,612) $ (2,139) $ 139,638
=======================================================================================
Year ended December 31, 1991:
Buildings and improvements $ 17,627 $ 3,410 $ (258) $ 28 (a) $ 20,807
Machinery and equipment 87,951 16,381 (2,816) 76 (a) 101,592
---------------------------------------------------------------------------------------
$ 105,578 $ 19,791 $ (3,074) $ 104 $ 122,399
=======================================================================================
(a) Effect of foreign currency translation.
(b) Transfers between classifications.
(c) Reduction in asset value related to restructuring reserve.
</TABLE>
F-4
<PAGE> 24
Intermet Corporation
(Consolidated)
Schedule VIII
Valuation and Qualifying Accounts
<TABLE>
<CAPTION>
BALANCE AT BALANCE
BEGINNING OF CHARGED TO AT END OF
DESCRIPTION PERIOD EXPENSE OTHER PERIOD
- ----------------------------------------------------------------------------------------------------
(In Thousands of Dollars)
<S> <C> <C> <C> <C>
Year ended December 31, 1993:
Returns and allowance
reserve (a) $ 1,454 $ 256 (b) $ (22) (c) $ 1,688
Supplies inventory reserve 3,280 546 (132) (c) 3,694
Deferred tax asset valuation
allowance 20,846 6,609 3,065 (e) 30,520
Year ended December 31, 1992:
Returns and allowance
reserve (a) $ 827 $ 633 (b) $ (6) (c) $ 1,454
Supplies inventory reserve 2,917 458 (95) (c) 3,280
Deferred tax asset valuation
allowance - - 20,846 (d) 20,846
Year ended December 31, 1991:
Returns and allowance
reserve (a) $ 1,228 $ (400)(b) $ (1) (c) $ 827
Supplies inventory reserve 2,685 239 (7) (c) 2,917
(a) Reflected as reduction of trade accounts receivable on consolidated
balance sheet.
(b) Net effect of amounts charged to expense less actual returns.
(c) Effect of foreign currency translation.
(d) Includes $17,915 established when SFAS 109 was adopted effective January
1, 1992 and 1992 change of $2,931, primarily related to acquired
operating loss carryforwards.
(e) Increase in certain deferred tax assets, including effect of U.S. rate
change.
</TABLE>
F-5
<PAGE> 25
Intermet Corporation
(Consolidated)
Schedule X
Supplementary Income Statement Information
<TABLE>
<CAPTION>
CHARGED TO COST AND EXPENSES
YEAR ENDED DECEMBER 31
ITEM 1993 1992 1991
-----------------------------------------------------------
(In Thousands of Dollars)
<S> <C> <C> <C>
Maintenance and repairs $ 45,427 $ 39,150 $ 29,840
===========================================================
</TABLE>
F-6
<PAGE> 26
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Report to be signed
on its behalf by the undersigned, thereunto duly authorized.
INTERMET CORPORATION
--------------------
(Registrant)
By: /s/ George W. Mathews, Jr.
--------------------------
George W. Mathews, Jr.,
Chairman of the Board of
Directors, Chief Executive
Officer and President
Date: March 28, 1994
POWER OF ATTORNEY AND SIGNATURES
Know all men by these presents, that each person whose signature
appears below constitutes and appoints George W. Mathews, Jr. and John D.
Ernst, or either of them, as attorney-in-fact, either with power of
substitution, for him in any and all capacities, to sign any amendments to this
Report on Form 10-K, and to file the same, with exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission,
hereby ratifying and confirming all that each of said attorneys-in-fact, or his
substitute or substitutes, may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934,
this Report has been signed below as of March 28, 1994 by the following persons
on behalf of the Registrant in the capacities indicated.
Signature Capacity
- --------- --------
/s/ George W. Mathews, Jr. Chairman of the Board of
- --------------------------- Directors, Chief Executive
George W. Mathews, Jr. Officer and President
(Principal Executive Officer)
/s/ Vernon R. Alden Director
- -----------------------------
Vernon R. Alden
Director
- -----------------------------
J. Frank Broyles
<PAGE> 27
/s/ John P. Crecine Director
- -----------------------------
John P. Crecine
Director
- -----------------------------
Anton Dorfmueller, Jr.
/s/ John B. Ellis Director
- --------------------------------
John B. Ellis
/s/ Wilfred E. Gross, Jr. Director
- ------------------------------
Wilfred E. Gross, Jr.
Director
- ----------------------------
A. Wayne Hardy
/s/ Harold C. McKenzie, Jr. Director
- ---------------------------
Harold C. McKenzie, Jr.
/s/ J. Mason Reynolds Director
- -----------------------------
J. Mason Reynolds
/s/ Curtis W. Tarr Director
- ------------------------------
Curtis W. Tarr
/s/ John D. Ernst Vice President - Finance,
- ------------------------------ Chief Financial Officer,
John D. Ernst Secretary and Treasurer
(Principal Financial Officer)
/s/ Peter C. Bouxsein Controller (Principal
- ------------------------------ Accounting Officer)
Peter C. Bouxsein
<PAGE> 28
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description of Exhibit Page
- ------ ---------------------- -----
<S> <C> <C>
3.2 and 4.2 Bylaws of the Registrant, as amended
4.19 Waiver and Third Amendment to Credit Agreement dated August 31, 1992, by and among the
Registrant, Trust Company Bank, Landesbank Saar Girozentrale, NBD Bank, N.A., Wachovia
Bank of Georgia, N.A., The First National Bank of Boston, First Union National Bank of
Georgia, Nationsbank of Georgia, N.A., National City Bank, Kentucky, formerly known as
The First National Bank of Louisville and Trust Company Bank, as agent, dated November
15, 1993, relating to a $75,000,000 and DM 8,000,000 Revolving Credit.
4.22 Second Amendment to Prudential Note Agreement, dated November 16, 1993, executed by the
Prudential Insurance Company of America and the Registrant.
10.14(e) Amendment No. 4 to the Intermet Corporation Employee Stock Ownership Plan and Trust
(1987), dated October 1, 1993, by and between the Registrant and Trust Company Bank, as
trustee.
10.15 Intermet Corporation 1993 Management Bonus Plan.
10.16(a) Intermet Corporation Salaried Employees Severance Plan effective as of October 1, 1993.
10.16(b) Amendment No. 1 to the Intermet Corporation Salaried Employees Severance Plan, dated
December 20, 1993.
10.17 1993 Special Voluntary Severance Plan for Salaried Employees of Intermet Foundries, Inc.
and its subsidiaries.
10.19(b) Amendment No. 1 to the Intermet Corporation Savings and Investment Plan and Trust, dated
April 13, 1993, by and between the Registrant and Trust Company Bank, as trustee.
10.19(c) Amendment No. 2 to the Intermet Corporation Savings and Investment Plan and Trust, dated
October 1, 1993, by and between the Registrant and Trust Company Bank, as trustee.
11 Computation of Earnings per Common Share.
13 Certain portions of the Annual Report to Shareholders which are incorporated by
reference into this Report on Form 10-K.
21 Subsidiaries of the Registrant
23 Consent of Ernst & Young (included herein on Page F-1)
99 Notice of Annual Meeting and Proxy Statement of the Registrant.
</TABLE>
<PAGE> 1
EXHIBIT 3.2 and 4.2
BY-LAWS
OF
INTERMET CORPORATION
(Amended and Restated as of June 10, 1985)
ARTICLE I
OFFICES
Section 1. Registered Office. The registered office shall be in
the State of Georgia, County of Cobb.
Section 2. Other Offices. The corporation may also have offices
at such other places both within and without the State of Georgia as the board
of directors may from time to time determine and the business of the
corporation may require or make desirable.
ARTICLE II
SHAREHOLDERS MEETINGS
Section 1. Annual Meetings. The annual meeting of the
shareholders of the corporation shall be held at the principal office of the
corporation or at such other place within or without the United States as may
be determined by the board of directors, at 10:00 a.m. on the last business day
of the fifth month following the close of each fiscal year or at such other
time and date prior thereto and following the close of the fiscal year as such
is determined by the board of directors, for the purpose of electing directors
and transacting such other business as may be properly brought before the
meeting.
Section 2. Special Meetings. Special meetings of the shareholders
shall be held at the principal office of the corporation or at such other place
within or without the United States as may be designated in the notice of said
meetings, upon call of the chairman of the board of directors or the president
and shall be called by the president or the secretary when so directed by the
board of directors or at the request in writing of shareholders owning at least
20% of the issued and outstanding capital stock of the corporation entitled to
vote thereat. Any such request shall state the purposes for which the meeting
is to be called.
Section 3. Notice of Meetings. Written notice of every meeting of
shareholders, stating the place, date and hour of the meetings, shall be given
personally or by mail to each shareholder of record entitled to vote at such
meeting not less than 10
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nor more than 50 days before the date of the meeting. If mailed, such notice
shall be deemed to be delivered when deposited in the United States mail with
first class postage (air mail postage if the address is outside of the United
States) thereon prepaid addressed to the shareholder at his address as it
appears on the corporation's record of shareholders. Attendance of a
shareholder at a meeting of shareholders shall constitute a waiver of notice of
such meeting and of all objections to the place or time of meeting, or the
manner in which it has been called or convened, except when a shareholder
attends a meeting solely for the purpose of stating, at the beginning of the
meeting, any such objection to the transaction of any business. Notice need
not be given to any shareholder who signs a waiver of notice, in person or by
proxy, either before or after the meeting.
Section 4. Quorum. The holders of a majority of the stock issued
and outstanding and entitled to vote thereat, present in person or represented
by proxy, shall constitute a quorum for the transaction of business at all
meetings of the shareholders except as otherwise provided by statute, by the
articles of incorporation, or by these by-laws. If a quorum is not present or
represented at any meeting of the shareholders, a majority of the shareholders
entitled to vote thereat, present in person or represented by proxy, may
adjourn the meeting from time to time, without notice other than announcement
at the meeting, until a quorum shall be present or represented. At such
adjourned meeting at which a quorum shall be present or represented, any
business may be transacted which might have been transacted at the meeting as
originally notified. If the adjournment is for more than 30 days, or it after
the adjournment a new record is fixed for the adjourned meeting, a notice of
the adjourned meeting shall be given to each shareholder of record entitled to
vote at the meeting.
Section 5. Order of Business. At the annual meeting of
shareholders the order of business shall be as follows:
1. Calling meeting to order.
2. Proof of notice of meeting.
3. Reading of minutes of last
previous annual meeting.
4. Reports of officers.
5. Reports of committees.
6. Election of directors.
7. Miscellaneous business.
Section 6. Voting. When a quorum is present at any meeting, the
vote of the holders of a majority of the stock having voting power, present in
person or represented by proxy, shall decide any question brought before such
meeting, unless the question is open upon which by express provision of law or
of the articles of incorporation, a different vote is required, in which
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case such express provision shall govern and control the decision of the
question. Each shareholder shall at every meeting of the shareholders be
entitled to one vote, in person or by proxy, for each share of the capital
stock having voting power registered in his name on the books of the
corporation, but no proxy shall be voted or acted upon after 11 months from its
date, unless otherwise provided in the proxy.
Section 7. Consent of Shareholders. Any action required or
permitted to be taken at any meeting of the shareholders may be taken without a
meeting if all of the shareholders consent thereto in writing, setting forth
the action so taken. Such consent shall have the same force and effect as a
unanimous vote of shareholders.
Section 8. List of Shareholders. The corporation shall keep at
its registered office or principal place of business, or at the office of its
transfer agent or registrar, a record of its shareholders, giving their names
and addresses and the number, class and series, if any, of the shares held by
each. The officer who has charge of the stock transfer books of the
corporation shall prepare and make, before every meeting of shareholders or any
adjournment thereof, a complete list of the shareholders entitled to vote at
the meeting or any adjournment thereof, arranged in alphabetical order, with
the address of and the number and class and series, if any, of shares held by
each. The list shall be produced and kept open at the time and place of the
meeting and shall be subject to inspection by any shareholder during the whole
time of the meeting for the purposes thereof. The said list may be the
corporation's regular record of shareholders if it is arranged in alphabetical
order or contains an alphabetical index.
ARTICLE III
DIRECTORS
Section 1. Powers. Except as otherwise provided by any legal
agreement among shareholders, the property, affairs and business of the
corporation shall be managed and directed by its board of directors, which may
exercise all powers of the corporation and do all lawful acts and things which
are not by law, by any legal agreement among shareholders, by the articles of
incorporation or by these by-laws directed or required to be exercised or done
by the shareholders.
Section 2. Number, Election and Term. The number of directors
which shall constitute the whole board shall be eleven (11). Provided,
however, the number of directors may be increased or decreased from time to
time by the board of directors by amendment of this by-law, but no decrease
shall have the effect of shortening the term of an incumbent director. Except
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as hereinafter provided, the directors shall be elected by plurality vote at
the annual meeting of shareholders, and each director elected shall hold office
until his successor is elected and qualified or until his earlier resignation,
removal from office or death. Directors shall be natural persons who have
attained the age of 18 years, but need not be residents of the State of Georgia
or shareholders of the corporation.
Section 3. Vacancies. Vacancies, including vacancies resulting
from any increase in the number of directors, but not including vacancies
resulting from removal from office by the shareholders, may be filled by a
majority of the directors then in office, though less than a quorum, or by a
sole remaining director, and a director so chosen shall hold office until the
next annual election and until his successor is duly elected and qualified
unless sooner displaced. If there are no directors in office, then vacancies
shall be filled through election by the shareholders.
Section 4. Meetings and Notice. The board of directors of the
corporation may hold meetings, both regular and special, either within or
without the State of Georgia. Regular meetings of the board of directors may
be held without notice at such time and place as shall from time to time be
determined by resolution of the board. Special meetings of the board may be
called by the chairman of the board or president or by any two directors on one
day's oral, telegraphic or written notice duly given or served on each director
personally, or three days' notice deposited, first class postage (air mail
postage if the address is outside of the United States) prepaid, in the United
States mail. Such notice shall state a reasonable time, date and place of
meeting, but the purpose need not be stated therein. Notice need not be given
to any director who signs a waiver of notice either before or after the
meeting. Attendance of a director at a meeting shall constitute a waiver of
notice of such meeting and waiver of all objections to the place and time of
the meeting, or the manner in which it has been called or convened except when
the director states, at the beginning of the meeting, any such objection or
objections to the transaction of business.
Section 5. Quorum. At all meetings of the board a majority of
directors shall constitute a quorum for the transaction of business, and the
act of a majority of the directors present at any meeting at which there is a
quorum shall be the act of the board, except as may be otherwise specifically
provided by law, by the articles of incorporation, or by these by-laws. If a
quorum shall not be present at any meeting of the board, the directors present
thereat may adjourn the meeting from time to time, without notice other than
announcement at the meeting, until a quorum shall be present.
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Section 6. Conference Telephone Meeting. Unless the articles of
incorporation or these by-laws otherwise provide, members of the board of
directors, or any committee designated by the board, may participate in a
meeting of the board or committee by means of conference telephone or similar
communications equipment whereby all persons participating in the meeting can
hear each other. Participation in the meeting shall constitute presence in
person.
Section 7. Consent of Directors. Unless otherwise restricted by
the articles of incorporation or these by-laws, any action required or
permitted to be taken at any meeting of the board of directors or of any
committee thereof may be taken without a meeting, if all members of the board
or committee, as the case may be, consent thereto in writing, setting forth the
action so taken, and the writing or writings are filed with the minutes of the
proceedings of the board or committee. Such consent shall have the same force
and effect as a unanimous vote of the board.
Section 8. Committees. The board of directors may, by resolution
passed by a majority of the whole board, designate from among its members one
or more committees, each committee to consist of two or more directors. The
board may designate one or more directors as alternate members of any
committee, who may replace any absent member at any meeting of such committee.
Any such committee, to the extent provided in the resolution, shall have and
may exercise all of the authority of the board of directors in the management
of the business and affairs of the corporation except that it shall have no
authority with respect to (1) amending the articles of incorporation or these
by-laws; (2) adopting a plan of merger or consolidation; (3) the sale, lease,
or exchange or other disposition of all or substantially all of the property
and assets of the corporation; and (4) a voluntary dissolution of the
corporation or a revocation thereof. Such committee or committees shall have
such name or names as may be determined from time to time by resolution adopted
by the board of directors. A majority of each committee may determine its
action and may fix the time and places of its meetings, unless otherwise
provided by the board of directors. Each committee shall keep regular minutes
of its meetings and report the same to the board of directors when required.
Section 9. Removal of Directors. At any shareholders' meeting
with respect to which notice of such purpose has been given, any director may
be removed from office, with or without cause, by the vote of shareholders
representing a majority of the issued and outstanding capital stock entitled to
vote for the election of directors, and his successor may be elected at the
same or any subsequent meeting of shareholders; provided that to the extent any
vacancy created by such removal is not filled by
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<PAGE> 6
such an election within 60 days after such removal, the remaining directors
shall, by majority vote, fill any such vacancy.
Section 10. Compensation of Directors. Directors shall be
entitled to such reasonable compensation for their services as directors or
members of any committee of the board as shall be fixed from time to time by
resolution adopted by the board, and shall also be entitled to reimbursement
for any reasonable expenses incurred in attending any meeting of the board or
any such committee.
ARTICLE IV
OFFICERS
Section 1. Number. The officers of the corporation shall be
chosen by the board of directors and shall be a chairman of the board, a
president, a secretary and a treasurer. The board of directors may also choose
one or more vice-presidents, assistant secretaries and assistant treasurers.
Any number of offices, except the offices of president and secretary may be
held by the same person. The board of directors may appoint such other
officers and agents as it shall deem necessary who shall hold their offices for
such terms and shall exercise such powers and perform such duties as shall be
determined from time to time by the board.
Section 2. Compensation. The salaries of all officers and agents
of the corporation shall be fixed by the board of directors or a committee or
officer appointed by the board.
Section 3. Term of Office. Unless otherwise provided by
resolution of the board of directors, the principal officers shall be chosen
annually by the board at the first meeting of the board following the annual
meeting of shareholders of the corporation, or as soon thereafter as is
conveniently possible. Subordinate officers may be elected from time to time.
Each officer shall serve until his successor shall have been chosen and
qualified, or until his death, resignation or removal.
Section 4. Removal. Any officer may be removed from office at any
time, with or without cause, by the board of directors whenever in its judgment
the best interest of the corporation will be served thereby.
Section 5. Vacancies. Any vacancy in an office resulting from any
cause may be filled by the board of directors.
Section 6. Powers and Duties. Except as hereinafter provided, the
officers of the corporation shall each have such powers and duties as generally
pertain to their respective
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offices, as well as such powers and duties as from time to time may be
conferred by the board of directors.
(a) Chairman of the Board. The chairman of the
board shall be the chief executive officer of the corporation and
shall preside at all meetings of the shareholders and the board of
directors. Except where by law the signature of the president is
required, the chairman shall possess the same power as the
president to sign all certificates representing shares of the
capital stock of the corporation and all bonds, mortgages and other
contracts requiring a seal, under the seal of the corporation.
(b) Vice Chairman of the Board. The vice
chairman of the board shall in the absence of the chairman of the
board preside at all meetings of the shareholders and the board of
directors, and shall perform such other duties and have such other
powers as the board of directors may from time to time prescribe.
(c) President. The president shall be the chief
operations officer of the corporation, and in the absence of the
chairman of the board shall preside at all meetings of the
shareholders and the board of directors. The president shall have
general and active management of the business of the corporation
and shall see that all orders and resolutions of the board of
directors are carried into effect. He shall execute bonds,
mortgages and other contracts requiring a seal, under the seal of
the corporation, except where required or permitted by law to be
otherwise signed and executed and except where the signing and
execution thereof shall be expressly delegated by the board of
directors to some other officer or agent of the corporation.
(d) Vice-President. In the absence of the
president or in the event of his inability or refusal to act, the
vice-president (or in the event there be more than one
vice-president, the vice presidents in the order designated, or in
the absence of any designation, then in order of their election)
shall perform the duties of the president, and when so acting,
shall have all the powers of and be subject to all the restrictions
upon the president. The vice-presidents shall perform such other
duties and have such other powers as the board of directors may
from time to time prescribe.
(e) Secretary. The secretary shall attend all
meetings of the board of directors and all meetings of the
shareholders and record of all the proceedings of the meetings of
the corporation and of the board of directors in a book to be kept
for that purpose and shall perform
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like duties for the standing committees when required. He shall
give, or cause to be given, notice of all meetings of the
shareholders and special meetings of the board of directors, and
shall perform such other duties as may be prescribed by the board
of directors or president, under whose supervision he shall be. He
shall have custody of the corporate seal of the corporation and he,
or an assistant secretary, shall have authority to affix the same
to any instrument requiring it and when so affixed, it may be
attested by his signature or by the signature of such assistant
secretary. The board of directors may give general authority to
any other officer to affix the seal of the corporation and to
attest the affixing by his signature.
(f) Assistant Secretary. The assistant secretary
or if there be more than one, the assistant secretaries in the
order determined by the board of directors (or if there be no such
determination, then in the order of their election), shall, in the
absence of the secretary or in the event of his inability or
refusal to act, perform the duties and exercise the powers of the
secretary and shall perform such other duties and have such other
powers as the board of directors may from time to time prescribe.
(g) Treasurer. The treasurer shall have the
custody of the corporate funds and securities and shall keep full
and accurate accounts of receipts and disbursements in books
belonging to the corporation and shall deposit all moneys and other
valuable effects in the name and to the credit of the corporation
in such depositories as may be designated by the board of
directors. He shall disburse the funds of the corporation as may
be ordered by the board of directors, taking proper vouchers for
such disbursements, and shall render to the chairman of the board,
the president and the board of directors, at its regular meetings,
or when the board of directors so requires, an account of all his
transactions as treasurer and of the financial condition of the
corporation. If required by the board of directors, he shall give
the corporation a bond (which shall be renewed every six years) in
such sum and with such surety or sureties as shall be satisfactory
to the board of directors for the faithful performance of the
duties of his office and for the restoration to the corporation, in
case of his death, resignation, retirement or removal from office,
of all books, papers, vouchers, money and other property of
whatever kind in his possession or under his control belonging to
the corporation.
(h) Assistant Treasurer. The assistant
treasurer, or if there shall be more than one, the assistant
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treasurers in the order determined by the board of directors (or if
there be no such determination, then in the order of their
election) shall, in the absence of the treasurer or in the event of
his inability or refusal to act, perform the duties and exercise
the powers of the treasurer and shall perform such other duties and
have such other powers as the board of directors may from time to
time prescribe.
Section 7. Voting Securities of the Corporation. Unless otherwise
ordered by the board of directors, the chairman of the board and the president
shall each have full power and authority on behalf of the corporation to attend
and to act and vote at any meetings of security holders of corporations in
which the corporation may hold securities, and at such meetings shall possess
and may exercise any and all rights and powers incident to the ownership of
such securities which the corporation might have possessed and exercised if it
had been present. The board of directors by resolution from time to time may
confer like powers upon any other person or persons.
ARTICLE V
CERTIFICATE
Section 1. Form of Certificate. Every holder of fully-paid stock
in the corporation shall be entitled to have a certificate in such form as the
board of directors may from time to time prescribe.
Section 2. Lost Certificates. The board of directors may direct
that a new certificate be issued in place of any certificate theretofore issued
by the corporation and alleged to have been lost, stolen or destroyed, upon the
making of an affidavit of that fact by the person claiming the certificate of
stock to be lost, stolen or destroyed. When authorizing such issue of a new
certificate, the board of directors may, in its discretion and as a condition
precedent to the issuance thereof, require the owner of such lost, stolen or
destroyed certificate, or his legal representative, to advertise the same in
such manner as it shall require and/or to give the corporation a bond in such
sum as it may direct as indemnity against any claim that may be made against
the corporation with respect to the certificate alleged to have been lost,
stolen or destroyed.
Section 3. Transfers. (a) Transfers of shares of the capital
stock of the corporation shall be made only on the books of the corporation by
the registered holder thereof, or by his duly authorized attorney, or with a
transfer clerk or transfer agent appointed as provided in Section 5 of this
Article, and on surrender of the certificates for such shares properly endorsed
and the payment of all taxes thereon.
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(b) The corporation shall be entitled to recognize the
exclusive right of a person registered on its books as the owner of shares to
receive dividends, and to vote as such owner, and for all other purposes, and
shall not be bound to recognize any equitable or other claim to or interest in
such share or shares on the part of any other person, whether or not it shall
have express or other notice thereof, except as otherwise provided by law.
(c) Shares of capital stock may be transferred by
delivery of the certificates therefor, accompanied either by an assignment in
writing on the back of the certificates or by separate written power of
attorney to sell, assign and transfer the same, signed by the record holder
thereof, or by his duly authorized attorney-in-fact, but no transfer shall
affect the right of the corporation to pay any dividend upon the stock to the
holder of record as the holder in fact thereof for all purposes, and no
transfer shall be valid, except between the parties thereto, until such
transfer shall have been made upon the books of the corporation as herein
provided.
(d) The board may, from time to time, make such
additional rules and regulations as it may deem expedient, not inconsistent
with these by-laws or the articles of incorporation, concerning the issue,
transfer and registration of certificates for shares of the capital stock of
the corporation.
Section 4. Record Date. In order that the corporation may
determine the shareholders entitled to notice of or to vote at any meeting of
shareholders or any adjournment thereof, or to express consent to corporate
action in writing without a meeting, or entitled to receive payment of any
dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock
or for the purpose of any other lawful action, the board of directors may fix,
in advance, a record date, which shall not be more than 50 days and, in case of
a meeting of shareholders, not less than 10 days prior to the date on which the
particular action requiring such determination of stockholders is to be taken.
If no record date is fixed for the determination of shareholders entitled to
notice of and to vote at any meeting of shareholders, the record date shall be
at the close of business on the day next preceding the day on which the notice
is given, or, if notice is waived, at the close of business on the day next
preceding the day on which the meeting is held. If no record date is fixed for
other purposes, the record date shall be at the close of business on the day
next preceding the day on which the board of directors adopts the resolution
relating thereto. A determination of shareholders of record entitled to notice
of or to vote at a meeting of shareholders shall apply to any adjournment of
the meeting unless the board of directors shall fix a new record date for the
adjourned meeting.
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Section 5. Transfer Agent and Registrar. The board of directors
may appoint one or more transfer agents or one or more transfer clerks and one
or more registrars, and may require all certificates of stock to bear the
signature or signatures of any of them.
ARTICLE VI
GENERAL PROVISIONS
Section 1. Dividends. Dividends upon the capital stock of the
corporation, subject to the provisions of the articles of incorporation, if
any, may be declared by the board of directors at any regular or special
meetings, pursuant to law. Dividends may be paid in cash, in property, or in
shares of the corporation's capital stock, subject to the provisions of the
articles of incorporation. Before payment of any dividend, there may be set
aside out of any funds of the corporation available for dividends such sum or
sums as the directors from time to time, in their absolute discretion, think
proper as a reserve or reserves to meet contingencies, or for equalizing
dividends, or for repairing or maintaining any property of the corporation, or
for such other purpose as the directors shall think conducive to the interest
of the corporation, and the directors may modify or abolish any such reserve in
the manner in which it was created.
Section 2. Fiscal Year. The fiscal year of the corporation shall
be fixed by resolution of the board of directors.
Section 3. Seal. The corporate seal shall have inscribed thereon
the name of the corporation, the year of its organization and the words
"Corporate Seal" and "Georgia". The seal may be used by causing it or a
facsimile thereof to be impressed or affixed or reproduced or otherwise. In
the event it is inconvenient to use such a seal at any time, the signature of
the corporation followed by the word "Seal" enclosed in parentheses shall be
deemed the seal of the corporation.
Section 4. Annual Statements. Not later than four months after
the close of each fiscal year, and in any case prior to the next annual meeting
of shareholders, the corporation shall prepare:
(1) A balance sheet showing in a reasonable
detail the financial condition of the corporation as of the close
of its fiscal year, and
(2) A profit and loss statement showing the
results of its operations during its fiscal year.
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Upon written request, the corporation promptly shall mail to any shareholder of
record a copy of the most recent such balance sheet and profit and loss
statement.
ARTICLE VII
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 1. Right of Indemnification and Standards of Conduct.
Every person (and the heirs and legal representatives of such person) who is or
was a director or officer of this corporation or any other corporation of which
he served as such at the request of this corporation and of which this
corporation directly or indirectly is a shareholder or creditor, or in which,
or in the stocks, bonds, securities or other obligations of which it is in any
way interested, may in accordance with Section 2 hereof be indemnified for any
liability and expense that may be incurred by him in connection with or
resulting from any threatened, pending or completed action, suit or
proceedings, whether civil, criminal, administrative or investigative (whether
brought by or in the right of this corporation or otherwise), or in connection
with any appeal relating thereto, in which he may become involved, as a party
or prospective party or otherwise, by reason of his being or having been a
director of officer of this corporation or such other corporation, or by reason
of any action taken or not taken in his capacity as such director of officer or
as a member of any committee appointed by the board of directors of this
corporation to act for, in the interest of, or on behalf of this corporation,
whether or not he continues to be such at the time such liability or expense
shall have been incurred; provided such person acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best interests of
this corporation and, in addition, with respect to any criminal action or
proceeding, did not have reasonable cause to believe that his conduct was
unlawful. As used in this Article, the terms "liability" and "expense" shall
include, but shall not be limited to, counsel fees and disbursements and
amounts of judgments, fines or penalties, and amounts paid in compromise or
settlement by a director of officer. The termination of any claim, action,
suit or proceeding, by judgment, order, compromise, settlement (with or without
court approval) or conviction or upon a plea of guilty or of nolo contendere,
or its equivalent, shall not create a presumption that a director or officer
did not meet the standards of conduct set forth in this Section.
Section 2. Determination of Right of Indemnification. Every
person (and the heirs and legal representatives of such person) referred to in
Section 1 hereof who has been wholly successful, on the merits or otherwise,
with respect to any claim, action, suit or proceeding of the character
described in Section 1 hereof shall be entitled to indemnification as of right
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without any further action or approval by the board of directors. Except as
provided in the immediately preceding sentence, any indemnification under
Section 1 next above shall be made at the discretion of this corporation, but
only if (a) the board of directors, acting by majority vote of a quorum
consisting of directors who were not parties to such claim, action, suit or
proceeding, present or voting, shall find that the director or officer has met
the standard of conduct set forth in Section 1 hereof, or (b) if no such quorum
of the board exists, independent legal counsel selected by any Judge of the
United States District Court for the Northern District of Georgia, at the
request of either the corporation or the person seeking indemnification, shall
deliver to the corporation their written opinion that such director or officer
has met such standards, or (c) the holders of a majority of stock then entitled
to vote for the election of directors shall determine by affirmative vote that
such director or officer has met such standards.
Notwithstanding the foregoing, no officer or director who was or is
a party to any action or suit by or in the right of the corporation to procure
a judgment in its favor by reason of the fact that he is or was an officer or
director of this or such other corporation shall be determined in respect of
any claim, issue or matter as to which such person shall have been adjudged to
be liable for negligence or misconduct in the performance of his duty to this
corporation unless and except to the extent that the Court in which such action
or suit was brought shall determine upon application that, despite the
adjudication of liability and in view of all the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for such expenses as
the Court shall deem proper.
Section 3. Advance of Expenses. Expenses incurred with respect to
any claim, action, suit or proceeding of the character described in Section 1
of this Article VII may be advanced by the corporation prior to the final
disposition thereof upon receipt of an undertaking by or on behalf of the
recipient to repay such amount unless it shall ultimately be determined that he
is entitled to indemnification under this Article.
Section 4. Rights of Indemnification Cumulative. The rights of
indemnification provided in this Article VII shall be in addition to any rights
to which any such director or officer or other person may otherwise be entitled
under any by-law, agreement, vote of shareholders, or otherwise, and shall be
in addition to the power of the corporation to purchase and maintain insurance
on behalf of any such director or officer or other person against any liability
asserted against him and incurred by him in such capacity, or arising out of
his status as such, regardless of whether the corporation would have the power
to indemnify him against such liability under this Article or otherwise.
-13-
<PAGE> 14
Section 5. Statement to Stockholders. If any expenses or other
amounts are paid by way of indemnification, otherwise than by court order or
action by the shareholders or by an insurance carrier pursuant to insurance
maintained by the corporation, the corporation shall, not later than the next
annual meeting of shareholders unless such meeting is held within three months
from the date of such payment, and, in any event, within 15 months from the
date of such payment, send by first class mail to its shareholders of record at
the time entitled to vote for the election of directors a statement specifying
the person paid, the amounts paid, and the nature and status at the time of
such payment of the litigation or threatened litigation.
ARTICLE VIII
AMENDMENTS
The board of directors shall have power to alter, amend or repeal
the by-laws or adopt new by-laws by majority vote of all of the directors, but
any by-laws adopted by the board of directors may be altered, amended or
repealed and new by-laws adopted, by the shareholders by majority vote of all
of the shares having voting power.
-14-
<PAGE> 15
CERTIFIED RESOLUTIONS
I, J. EDWIN POPE, Secretary of INTERMET CORPORATION, a Georgia
corporation (the "Corporation"), do hereby certify that the resolutions set
forth on Exhibit A attached hereto and incorporated herein by reference were
duly adopted by the Board of Directors of the Corporation on May 6, 1985, and
that, except as amended, modified or rescinded at a meeting of the
Corporation's Executive Committee held on June 26, 1985, said resolutions have
not been rescinded, amended or modified.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand and
the seal of the Corporation this 22nd day of July, 1985.
/s/ J. Edwin Pope
-------------------
J. Edwin Pope
Secretary
(CORPORATE SEAL)
-15-
<PAGE> 16
EXHIBIT A
RESOLUTIONS ADOPTED AT BOARD OF
DIRECTORS MEETING OF INTERMET CORPORATION
ON MAY 6, 1985
WHEREAS, the Corporation has no shares of Class B Common Stock
outstanding, and, under its Articles of Incorporation, is not authorized to
issue any shares of Class B Common Stock in the future; and
WHEREAS, it is in the best interest of the Corporation to amend and
restate its Articles of Incorporation to remove the provisions relating to
Class B Common Stock, to redesignate Class A Common Stock of the Corporation
and to increase the number of authorized shares of Common Stock;
NOW, THEREFORE, BE IT RESOLVED, that the Amended and Restated
Articles of Incorporation of the Corporation attached hereto be, and the same
hereby are, adopted, ratified and approved; and
BE IT FURTHER RESOLVED, that the proposed Amended and Restated
Articles of Incorporation be submitted to the shareholders of the Corporation
for their approval as required by Section 14-2-196 of the Official Code of
Georgia Annotated; and
BE IT FURTHER RESOLVED, that the Chairman of the Board, Vice
Chairman of the Board, President and any Vice President of the Corporation be,
and each of them hereby is, authorized, empowered and directed to make and
execute, under the corporate seal of the Corporation, the Amended and Restated
Articles of Incorporation attached hereto, and, upon the approval of the
Amended and Restated Articles of Incorporation by the shareholders of the
Corporation, to file the same in the office of the Secretary of State of
Georgia; and
BE IT FURTHER RESOLVED, that, upon the approval of the Amended and
Restated Articles of Incorporation by the shareholders of the Corporation, the
proper officers of the Corporation shall be, and each of them hereby is,
authorized, empowered and directed to do any and all acts and things
whatsoever, whether within or without the State of Georgia, which may be in any
way necessary or proper to effect said Amendment; and
BE IT FURTHER RESOLVED, that upon the filing of the Amended and
Restated Articles of Incorporation with the Secretary of State of Georgia, each
of the shares of Class A Common Stock of the Corporation outstanding on that
date shall be redesignated
-16-
<PAGE> 17
as, and shall be deemed to represent, one share of the Common Stock of the
Corporation; and
BE IT FURTHER RESOLVED, that upon the filing of the Amended and
Restated Articles of Incorporation with the Secretary of State of Georgia, each
of the certificates representing the shares of Class A Common Stock of the
Corporation outstanding on that date shall be deemed for all corporate purposes
to evidence ownership of the same number of shares of the Common Stock of the
Corporation, and the holders of such certificates representing shares of the
Class A Common Stock of the Corporation shall be entitled to exchange such
certificates for certificates representing the same number of shares of the
Common Stock of the Corporation; and
BE IT FURTHER RESOLVED, that upon the approval of the Amended and
Restated Articles of Incorporation by the shareholders of the Corporation, the
By-Laws of the Corporation be amended by deleting Article III, Section 2
thereof in its entirety, and by substituting in lieu thereof the following:
Section 2. Number, Election and Term. The number of
directors which shall constitute the whole board shall be eleven
(11). Provided, however, the number of directors may be increased
or decreased from time to time by the board of directors by
amendment of this by-law, but no decrease shall have the effect of
shortening the term of an incumbent director. Except as
hereinafter provided, the directors shall be elected by plurality
vote at the annual meeting of shareholders, and each director
elected shall hold office until his successor is elected and
qualified or until his earlier resignation, removal from office or
death. Directors shall be natural persons who have attained the
age of 18 years, but need not be residents of the State of Georgia
or shareholders of the corporation.
BE IT FURTHER RESOLVED, that upon the approval of the Amended and
Restated Articles of Incorporation by the shareholders of the Corporation, the
By-Laws of the Corporation be amended by deleting Article III, Section 3
thereof in its entirety, and by substituting in lieu thereof the following:
Section 3. Vacancies. Vacancies, including
vacancies resulting from any increase in the number of directors,
but not including vacancies resulting from removal from office by
the shareholders may be filled by a majority of the directors then
in office, though less than a quorum, or by a sole remaining
director, and a director so chosen shall hold office until the
next annual election and until his successor is duly elected and
qualified unless sooner displaced. If there are no directors in
-17-
<PAGE> 18
office, then vacancies shall be filled through election by the
shareholders.
BE IT FURTHER RESOLVED, that upon the approval of the Amended and
Restated Articles of Incorporation by the shareholders of the Corporation, the
By-Laws of the Corporation be amended by deleting Article III, Section 9
thereof in its entirety, and by substituting in lieu thereof the following:
Section 9. Removal of Directors. At any shareholders'
meeting with respect to which notice of such purpose has been
given, any director may be removed from office, with or without
cause, by the vote of shareholders representing a majority of the
issued and outstanding capital stock entitled to vote for the
election of directors, and his successor may be elected at the
same or any subsequent meeting of shareholders; provided that to
the extent any vacancy created by such removal is not filled by
such an election within 60 days after such removal, the remaining
directors shall, by majority vote, fill any such vacancy.
-18-
<PAGE> 19
CERTIFICATE OF ASSISTANT SECRETARY
The undersigned as Assistant Secretary of Intermet Corporation (the
"Corporation") hereby certifies that the following resolution was duly adopted
by the Board of Directors of the Corporation on July 26, 1990:
Upon motion duly made and seconded, Article III,
Section 2 of the Corporation's By-laws was appropriately amended to
increase the number of directors to twelve.
/s/ Rupert M. Barkoff
----------------------------
Rupert M. Barkoff
Assistant Secretary
Intermet Corporation
-19-
<PAGE> 20
CERTIFICATE OF ASSISTANT SECRETARY
The undersigned as Assistant Secretary of Intermet Corporation (the
"Corporation") hereby certifies that the following resolution was duly adopted
by the Board of Directors of the Corporation on February 7, 1991:
Upon motion duly made and seconded, Article III,
Section 2 of the Corporation's By-laws was amended to provide that
the number of directors of the Corporation shall be ten.
/s/ Rupert M. Barkoff
--------------------------
Rupert M. Barkoff
Assistant Secretary
Intermet Corporation
-20-
<PAGE> 21
CERTIFICATE OF ASSISTANT SECRETARY
The undersigned is Assistant Secretary of Intermet Corporation (the
"Corporation") hereby certifies that the following resolution was duly adopted
by the Board of Directors of the Corporation on February 11, 1993:
Upon motion duly made and seconded, Article III,
Section 2 of the Corporation's By-laws was amended to provide that
the number of directors of the Corporation shall be twelve.
/s/ Rupert M. Barkoff
---------------------------
Rupert M. Barkoff
Assistant Secretary
Intermet Corporation
-21-
<PAGE> 22
CERTIFICATE OF ASSISTANT SECRETARY
The undersigned as Assistant Secretary of Intermet Corporation (the
"Corporation") hereby certifies that the following resolution was duly adopted
by the Board of Directors of the Corporation on February 10, 1994:
Upon motion duly made and seconded, Article III,
Section 2 of the Corporation's By-laws was amended to provide that
the number of directors of the Corporation shall be eleven.
/s/ Rupert M. Barkoff
--------------------------
Rupert M. Barkoff
Assistant Secretary
Intermet Corporation
-22-
<PAGE> 1
EXHIBIT 4.19
EXECUTION COUNTERPART
WAIVER AND THIRD AMENDMENT TO
CREDIT AGREEMENT
THIS WAIVER AND THIRD AMENDMENT TO CREDIT AGREEMENT (the "Amendment")
dated as of November 15, 1993, by and among INTERMET CORPORATION, a Georgia
corporation (referred to herein either as "Intermet" or as the "Borrower"),
TRUST COMPANY BANK, a Georgia banking corporation, LANDESBANK SAAR
GIROZENTRALE, a German banking corporation, NBD BANK, N.A., a national banking
association, WACHOVIA BANK OF GEORGIA, N.A., a national banking association,
THE FIRST NATIONAL BANK OF BOSTON, a national banking association, FIRST UNION
NATIONAL BANK OF GEORGIA, a national banking association, NATIONSBANK OF
GEORGIA, N.A., a national banking association, and NATIONAL CITY BANK,
KENTUCKY, FORMERLY KNOWN AS THE FIRST NATIONAL BANK OF LOUISVILLE, a national
banking association (collectively, the "Lenders") and TRUST COMPANY BANK, in
its capacity as agent (in such capacity, the "Agent");
W I T N E S S E T H:
WHEREAS, the Borrower, the Lenders and the Agent are parties to a
certain Credit Agreement dated as of August 31, 1992, as amended by that
certain First Amendment to Credit Agreement dated as of December 11, 1992 and
as further amended by that certain Waiver and Second Amendment to Credit
Agreement dated as of March 19, 1993 (as amended, the "Credit Agreement"; all
terms used herein without definition shall have the meanings ascribed to such
terms in the Credit Agreement);
WHEREAS, based upon the Borrower's preliminary calculations, the
Borrower will not be in compliance with Section 8.08(b) of the Credit Agreement
upon delivery of its financial statements for its fiscal quarter ended
September 30, 1993 pursuant to Section 8.07(b);
WHEREAS, the Borrower has requested that the Lenders (i) waive
compliance with Section 8.08(b) for the fiscal period ending September 30,
1993, and (ii) amend Section 8.08(b) and various other financial covenants and
related definitions to make such covenants less restrictive;
WHEREAS, the Lenders have agreed to such amendments as more
specifically set forth below upon the condition that the Credit Agreement also
be amended to provide for certain increased interest rate margins;
WHEREAS, the parties wish to amend the Credit Agreement to reflect
these agreements and to waive compliance with Section 8.08(b) for the fiscal
quarter ending September 30, 1993, all
<PAGE> 2
upon the terms and subject to the conditions set forth herein;
NOW, THEREFORE, for and in consideration of the mutual premises
contained herein and other valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto, intending to be legally
bound, agree as follows:
1. Section 1.01 of the Credit Agreement is hereby amended as
follows:
(a) By adding the definitions of "Adjusted
Cash Flow," "Adjusted Fixed Charge Coverage Ratio"
and "Capital Expenditure" set forth below in the
appropriate alphabetical order:
`"Adjusted Cash Flow" shall mean, for any
fiscal period of Intermet, Consolidated EBITDAR minus
the sum of (i) Capital Expenditures made by the
Consolidated Companies during such fiscal period and
(ii) taxes on income paid by the Consolidated
Companies in cash (less cash refunds received) during
such fiscal period to any federal, state or local
authorities, determined on a consolidated basis in
accordance with GAAP. Notwithstanding the foregoing,
in the event that any of the Consolidated Companies
receives a refund of taxes during the fourth fiscal
quarter of 1993, such amount shall be added back to
offset the payment of income taxes pursuant to
subsection (ii) above in the first fiscal quarter of
1994.
"Adjusted Fixed Charge Coverage Ratio" shall
mean, with respect to any fiscal period of Intermet,
the ratio of (A) Adjusted Cash Flow to (B) the sum of
(i) Consolidated Interest Expense paid in cash during
such fiscal period, (ii) Consolidated Rental Expense
paid in cash during such fiscal period, and (iii)
scheduled principal reductions of Funded Debt of the
Consolidated Companies paid in cash during such
fiscal period, as determined on a consolidated basis
in accordance with GAAP.
"Capital Expenditure" shall mean, for any
fiscal period of Intermet, the sum of (i) cash
expenditures by the Consolidated Companies during
that fiscal period that, in conformity with GAAP, are
included in "capital expenditures", "additions to
property, plant or equipment" or comparable items in
the financial statements of the Consolidated
Companies, and (ii) to the extent not included in
clause (i) above, cash expenditures for all net
non-current assets of businesses acquired by the
Consolidated Companies during that period, including
all purchase price adjustments, other than such
assets acquired in transactions where all or
substantially all of the consideration paid for such
assets consisted of capital stock of a Consolidated
Company.'
(b) By deleting the definition of
"Applicable Margin" set forth therein and
substituting in lieu thereof the following
definition:
-2-
<PAGE> 3
EXECUTION COUNTERPART
`"Applicable Margin" shall mean (i) with
respect to all outstanding Borrowings through April
30, 1993, three quarters of one percent (0.75%) per
annum, (ii) with respect to all outstanding
Borrowings from May 1, 1993 through November 30,
1993, one and one quarter of one percent (1.25%) per
annum, (iii) with respect to all outstanding
Borrowings from December 1, 1993 through the last day
of the second fiscal quarter of 1994, one and
three-quarters of one percent (1.75%) per annum, and
(iv) with respect to all outstanding Borrowings
thereafter, the higher percentage of the relevant
percentages indicated for each of Intermet's Adjusted
Fixed Charge Coverage Ratio and Leverage Ratio on the
chart below as determined as of the last day of each
fiscal quarter (or fiscal year as the case may be) of
Intermet, commencing with the fiscal quarter ending
on or about March 31, 1994, to be effective as of the
first day of the second succeeding fiscal quarter
thereafter, commencing on or about July 1, 1994, with
such Applicable Margin to be immediately effective as
of such date with respect to all outstanding amounts
under the Revolving Loan Credit, Currency Loan
Commitment or Term Loans, as the case may be:
[CHART SET FORTH ON NEXT PAGE]
-3-
<PAGE> 4
<TABLE>
<CAPTION>
Revolving/Currency Term Loans Adjusted Fixed Leverage
Revolving Charge Coverage Ratio
Loans Ratio
<S> <C> <C> <C>
2.000% 2.250% less than 1.00:1.00 NOT APPLICABLE
1.750% 2.000% greater than or
equal to 1.00:1.00 greater than or
and less than equal to 0.45:1.00
1.30:1.00
1.500% 1.750% greater than or greater than or
equal to 1.30:1.00 equal to 0.40:1.00
and less than but less than
1.45:1.00 O.45:1.00
1.250% 1.500% greater than or greater than or
equal to 1.45 less equal to 0.40:1.00
than 1.65 but less than
0.45:1.00
1.00% 1.250% greater than or greater than or
equal to 1.65:1.00 equal to 0.35:1.00
but less than but less than
1.75:1.00 0.40:1.00
0.750% 1.00% greater than or greater than or
equal to 1.75:1.00 equal to 0.20:1.00
but less than but less than
3.50:1.00 0.35:1.00
0.625% 0.875% greater than less than 0.20:1.00
3.50:1.00
</TABLE>
(c) By deleting the definitions of
"Consolidated EBIT" and "Consolidated EBITDA" set
forth therein and substituting the following
definition of "Consolidated EBITDAR" in lieu thereof:
`"Consolidated EBITDAR" shall mean, for any fiscal
period of Intermet, an amount equal to (A) the sum
for such fiscal period of Consolidated Net Income
(Loss) and, to the extent subtracted in determining
such Consolidated Net Income (Loss), provisions for
(i) taxes based on income, (ii) Consolidated Interest
Expense to the extent paid in
-4-
<PAGE> 5
EXECUTION COUNTERPART
cash, (iii) Consolidated Rental Expense to the extent
paidin cash, (iv) charges taken in conformity with
FASB 106 prior to fiscal year-end 1993, and (v)
depreciation and amortization expense of the
Consolidated Companies during such period, minus (B)
any items of gain (or plus any items of loss) which
were included in determining such Consolidated Net
Income (Loss) and were (x) not realized in the
ordinary course of business (whether or not
classified as "ordinary" by GAAP), (y) the result of
any sale of assets, or (z) resulting from minority
investments.'
(d) By deleting the definition of "Fixed
Charge Coverage Ratio" set forth therein.
2. Section 8.07 of the Credit Agreement is hereby amended as
follows:
(a) By amending subsection (a) thereof by
deleting "120" in the second line and substituting
in lieu thereof "90."
(b) By amending subsection (b) thereof by
adding "and consolidating" after the word
"consolidated" in the fifth, ninth and seventeenth
lines of such subsection.
(c) By amending subsection (e) thereof by
deleting "Within 120 days after" and substituting in
lieu thereof "No later than thirty (30) days prior
to".
(d) By adding the following new subsection
(u) thereto:
"(u) Monthly Financial Statements. As
soon as available and in any event within thirty (30)
days after the end of each calendar month, (a)
balance sheets of Intermet, Intermet Foundries, Inc.
("IFI") and Intermet Machining, Inc. ("IMI") as at
the end of such month, presented on a consolidated
and consolidating basis for Intermet, IFI and IMI,
(b) statements of cash flows of Intermet as at the
end of such month, presented on a consolidated and
consolidating basis for Intermet, and (c) the related
statements of income of Intermet, IFI and IMI as at
the end of such month, presented on a consolidated
and consolidating basis for Intermet, IFI and IMI, in
each case, setting forth in comparative form the
figures for such month shown in the budget prepared
by Intermet for its internal use (rather than the
budget delivered to the Lenders pursuant to
subsection (e) above), all in reasonable detail and
prepared
-5-
<PAGE> 6
by the chief financial officer or principal
accounting officer of Intermet in accordance with
GAAP consistently applied (subject to normal year-end
audit adjustments and the absence of certain
footnotes)."
3. Section 8.08 of the Credit Agreement is
hereby amended by deleting subsections (b), (d) and (e) thereof in their
entirety and substituting the following in lieu thereof:
"(b) Adjusted Fixed Charge Coverage Ratio.
Maintain as of the last day of each fiscal quarter, a
minimum Adjusted Fixed Charge Coverage Ratio,
calculated for the immediately preceding four fiscal
quarters, as shown below for each fiscal quarter
ending during the periods indicated; provided that,
with respect to the fiscal quarter ending on or about
December 31, 1993, the Adjusted Fixed Charge Coverage
Ratio shall be calculated for the period commencing
on October 1, 1993 and ending on such date; and
further provided that, with respect to the fiscal
quarters ending on or about March 31, 1994, June 30,
1994 and September 31, 1994, the Adjusted Fixed
Charge Coverage Ratio shall be calculated for the
period commencing on January 1, 1994 and ending on
such date:
<TABLE>
<CAPTION>
Minimum Adjusted
Fixed Charge
Coverage
Period Ratio
------ ---------------
<S> <C>
Fourth Fiscal Quarter End 1993 -2.30:1.0
First Fiscal Quarter End 1994 0.10:1.0
Second Fiscal Quarter End 1994 1.35:1.0
Third Fiscal Quarter End 1994
and thereafter 1.50:1.0.
</TABLE>
(d) Leverage Ratio. Maintain as of the
last day of each fiscal quarter, a maximum Leverage
Ratio as shown below for each fiscal quarter ending
during the periods indicated:
<TABLE>
<CAPTION>
Maximum Leverage
Period Ratio
------ ---------------
<S> <C>
Third Fiscal Quarter End 1992 through
Third Fiscal Quarter End 1993 0.45:1.0
Fourth Fiscal Quarter End 1993 through
First Fiscal Quarter End 1994 0.51:1.0
Second Fiscal Quarter End 1994 through
Third Fiscal Quarter End 1994 0.50:1.0
Fourth Fiscal Quarter End 1994 through
First Fiscal Quarter End 1995 0.48:1.0
Second Fiscal Quarter End 1995
and thereafter 0.45:1.0
</TABLE>
-6-
<PAGE> 7
EXECUTION COUNTERPART
(e) Funded Debt to Consolidated EBITDAR.
Maintain as of the last day of each fiscal quarter, a
maximum ratio of Funded Debt to Consolidated EBITDAR,
calculated for the immediately preceding four fiscal
quarters, less than or equal to 3.5:1.0; provided
that, for the period ending on or about March 31,
1994, such maximum ratio shall be less than or equal
to 3.75:1.0."
4. Pursuant to Section 8.08(b) of the Credit
Agreement, the Borrower is required to have a minimum Fixed Charge Coverage
Ratio, calculated as at the Third Fiscal Quarter End 1993, of not less than
1.00:1.00. Based on Borrower's preliminary calculations, the Borrower is not
in compliance with such covenant. The Borrower has requested and the Lenders
have agreed to waive compliance with Section 8.08(b) for the Third Fiscal
Quarter End 1993.
5. The Borrower hereby agrees that nothing
herein shall constitute a waiver by the Lenders of any Default or Event of
Default, whether known or unknown, which may exist under the Credit Agreement
except as specifically set forth in Section 4 hereof. Without limiting the
generality of the foregoing, the Borrower expressly acknowledges and agrees
that nothing herein shall constitute a waiver of a Default or an Event of
Default arising pursuant to Section 10.06 of the Credit Agreement with respect
to a default under any other agreement of the Borrower, except for any Default
or Event of Default arising pursuant to the Note Purchase Agreement which is
expressly waived in the amendment thereto referenced in Section 6 hereof. The
Borrower represents and warrants to the Lenders that as of the date hereof, no
Default or Event of Default exists pursuant to the Credit Agreement which is
not expressly waived herein. In addition, the Borrower acknowledges and agrees
that it has no knowledge of any defenses, counterclaims, offsets or objections
in its favor against the Lenders with regard to any of the obligations due
under the terms of the Credit Agreement as of the date of this Amendment.
6. In compliance with Section 9.13 of the Credit
Agreement, each of the Agent and the Lenders, by its signature below, hereby
consents to the execution by Intermet of the
-7-
<PAGE> 8
amendment to the Note Purchase Agreement attached hereto as Exhibit "A".
7. Intermet, without limiting the
representations and warranties provided in the Credit Agreement, represents and
warrants to the Lenders and the Agent as follows:
(a) The execution, delivery and
performance by Intermet of this Amendment are within
Intermet's corporate powers, have been duly
authorized by all necessary corporate action
(including any necessary shareholder action) and do
not and will not (a) violate any provision of any
law, rule or regulation, any judgment, order or
ruling of any court or governmental agency, the
articles of incorporation or by-laws of Intermet or
any indenture, agreement or other instrument to which
Intermet is a party or by which Intermet or any of
its properties is bound or (b) be in conflict with,
result in a breach of, or constitute with notice or
lapse of time or both a default under any such
indenture, agreement or other instrument.
(b) This Amendment constitutes the
legal, valid and binding obligations of Intermet,
enforceable against Intermet in accordance with its
terms.
(c) No Default or Event of Default has
occurred and is continuing as of the date hereof.
(d) All representations and warranties
by Intermet contained in the Credit Agreement, as
amended by this Amendment, are true and correct in
all material respects with the same effect as though
such representations and warranties had been made on
and as of the date hereof.
8. Except as expressly amended and modified
herein, all terms and covenants and provisions of the Credit Agreement shall
remain unaltered and in full force and effect, and the parties hereto do
expressly ratify and confirm the Credit Agreement as modified herein. All
future references to the Credit Agreement shall be deemed to refer to the
Credit Agreement as amended hereby.
9. Intermet agrees to pay on demand all
reasonable costs and expenses of the Agent in connection with the preparation,
execution and delivery of this Amendment and the other instruments and
documents to be delivered hereunder, including, without limitation, the
reasonable fees and out-of-pocket expenses of counsel for the Agent with
respect thereto and with respect to advising the Agent as to its rights and
responsibilities hereunder and thereunder.
10. This Amendment shall be effective upon
receipt by the Agent of (i) fully executed counterparts of this Amendment in
its offices in Atlanta, Georgia, (ii) an amendment fee paid by Intermet to the
Agent on behalf of each of the Lenders in the amount of $5,000 for each Lender,
(iii) a written consent to the
-8-
<PAGE> 9
EXECUTION COUNTERPART
terms of this amendment in form and substance satisfactory to the Agent
executed by a duly authorized officer of The Prudential Insurance Company of
America, and (iv) a duly executed amendment to the Note Purchase Agreement in
the form attached hereto as Exhibit "A".
11. This Amendment shall be binding upon and
inure to the benefit of the parties hereto, their respective heirs, successors,
successors-in-titles, and assigns.
12. This Amendment shall be governed by and
construed in accordance with the laws of the State of Georgia, notwithstanding
any principles regarding conflicts of laws thereof.
13. This Agreement sets forth the entire
understanding of the parties with respect to the matters set forth herein, and
shall supersede any prior negotiations or agreements, whether written or oral,
with respect thereto.
14. This Amendment may be executed in any number
of counterparts and by different parties hereto in separate counterparts and
may be delivered by telecopier. Each counterpart so executed and delivered
shall be deemed an original and all of which taken together shall constitute
but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have
executed this Amendment through their authorized officers as of the date first
above written.
INTERMET CORPORATION
By:
------------------------------
Title:
Attest:
------------------------------
Title:
------------------------
[CORPORATE SEAL]
TRUST COMPANY BANK
By:
------------------------------
Title:
-9-
<PAGE> 10
By:
------------------------------
Title:
LANDESBANK SAAR GIROZENTRALE
By:
------------------------------
Title:
By:
------------------------------
Title:
NBD BANK, N.A.
By:
------------------------------
Title:
WACHOVIA BANK OF GEORGIA, N.A.
By:
------------------------------
Title:
THE FIRST NATIONAL BANK OF BOSTON
By:
------------------------------
Title:
FIRST UNION NATIONAL BANK OF
GEORGIA
By:
------------------------------
Title:
NATIONSBANK OF GEORGIA, N.A.
By:
------------------------------
Title:
NATIONAL CITY BANK, KENTUCKY,
FORMERLY KNOWN AS THE FIRST
NATIONAL BANK OF LOUISVILLE
<PAGE> 11
EXECUTION COUNTERPART
By:
------------------------------
Title:
TRUST COMPANY BANK, AS AGENT
By:
------------------------------
Title:
By:
------------------------------
Title:
-11-
<PAGE> 12
CONSENT AND RATIFICATION OF GUARANTORS
Each of the undersigned Guarantors acknowledges its receipt of and
consent to the Waiver and Third Amendment to Credit Agreement attached hereto
and incorporated herein by this reference and further acknowledges and agrees
that nothing contained therein shall release, discharge, modify, change or
affect the original liability of the Guarantors under the Guaranty Agreement
and each Guarantor ratifies and affirms the terms and conditions of the
Guaranty Agreement which remains in full force and effect.
IN WITNESS WHEREOF, each Guarantor has executed this Consent and
Ratification under seal as of this ______ day of November, 1993.
INTERMET FOUNDRIES, INC.
(a "Guarantor")
By:
-------------------------------------
Title:
-------------------------------
COLUMBUS FOUNDRIES, INC.
(a "Guarantor")
By:
------------------------------------
Title:
------------------------------
LYNCHBURG FOUNDRY COMPANY
(a "Guarantor")
By:
------------------------------------
Title:
------------------------------
IRONTON IRON, INC.
(a "Guarantor")
By:
------------------------------------
Title:
------------------------------
-12-
<PAGE> 13
EXECUTION COUNTERPART
NORTHERN CASTINGS CORPORATION
(a "Guarantor")
By:
------------------------------------
Title:
-----------------------------
PENNSYLVANIA CASTINGS CORPORATION
(a "Guarantor")
By:
------------------------------------
Title:
------------------------------
INTERMET INTERNATIONAL, INC.
(a "Guarantor")
By:
------------------------------------
Title:
------------------------------
INTERMET MACHINING, INC.
(a "Guarantor")
By:
------------------------------------
Title:
------------------------------
COMMERCIAL AND PRECISION MACHINING, INC.
(a "Guarantor")
By:
------------------------------------
Title:
------------------------------
PBM INDUSTRIES, INC.
(a "Guarantor")
-13-
<PAGE> 14
By:
-------------------------------------
Title:
-------------------------------
INTERMOTIVE TECHNOLOGIES, INC.
(a "Guarantor")
By:
-------------------------------------
Title:
-------------------------------
NEW RIVER CASTINGS COMPANY
(a "Guarantor")
By:
-------------------------------------
Title:
-------------------------------
INTERMET ALUMINUM, INC.
(a "Guarantor")
By:
-------------------------------------
Title:
-------------------------------
I.C. VENTURE, INC.
(a "Guarantor")
By:
-------------------------------------
Title:
-------------------------------
-14-
<PAGE> 1
EXHIBIT 4.22
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
c/o Prudential Capital Group
Four Gateway Center
100 Mulberry Street
Newark, New Jersey 07102
November 16, 1993
INTERMET CORPORATION
2859 Paces Ferry Road
Suite 1600
Atlanta, Georgia 30339
Subject: Amendment to Note Agreement
LADIES AND GENTLEMEN:
This letter is to amend the NOTE AGREEMENT dated as of December 11,
1992, as amended (the "Agreement"), between INTERMET CORPORATION (the
"Company") and THE PRUDENTIAL INSURANCE COMPANY OF AMERICA ("Prudential").
Capitalized words and terms in this letter that are undefined shall have the
same meaning as in the Agreement.
Pursuant to paragraph 11C of the Agreement, Prudential and the Company
agree to amend the Agreement effective as of October 3, 1993, as follows:
1. The words "at the rate of 8.05% per annum" in paragraph 1
shall be replaced with the words "at the rate per annum specified therein".
2. The amount of interest to be paid under the Notes shall be
changed as of December 12, 1993 to the rate specified in the Note attached as
Exhibit A to this letter. To effect this change, the current Exhibit A to the
Note Agreement shall be replaced as of December 12, 1993 with a new Exhibit A
in the form attached as Exhibit A to this letter and the Company agrees to sign
and deliver to us a new Note, to be effective as of December 12, 1993, in the
form attached as Exhibit A to this letter.
3. Paragraph 5A is amended:
(a) by replacing the "120" in clause (ii) with "90";
(b) by replacing the phrase "within 120 days after" in
clause (v) with the phrase "no later than 30 days prior to"; and
(c) by adding a new clause (ix) immediately before the
period punctuation at the end of the first sentence thereof:
<PAGE> 2
INTERMET CORPORATION
November 16, 1993
Page 2
"(ix) within thirty (30) days after the end of each
calendar month:
(a) balance sheets of the Company,
Intermet Foundries, Inc. ("IFI") and Intermet
Machining, Inc. ("IMI") as at the end of such month,
presented on a consolidated and consolidating basis
for the Company, IFI, and IMI,
(b) statements of cash flows of the
Company as at the end of such month, presented on a
consolidated and consolidating basis for the Company,
and
(c) the related statements of income of
the Company, IFI, and IMI as at the end of such
month, presented on a consolidated and consolidating
basis for the Company, IFI, and IMI, in each case,
setting forth in comparative form the figures for
such month shown in the budget prepared by the
Company for its internal use (rather than the budget
delivered under clause (v) above), all in reasonable
detail and prepared by the chief financial officer or
principal accounting officer of the Company in
accordance with GAAP consistently applied (subject to
normal year-end audit adjustments and the absence of
certain footnotes)."
4. The Company need not comply with clause (ii) of paragraph 6A
as of the Third Fiscal Quarter End 1993, and any Default or Event of Default
from noncompliance with that provision during that fiscal quarter is hereby
waived. Effective as of October 4, 1993, clause (ii) of paragraph 6A shall be
replaced with the words "Intentionally Deleted".
5. Effective as of October 4, 1993, a new clause (iii) of
paragraph 6A shall be added as follows:
"(iii) the Adjusted Fixed Charge Coverage Ratio, calculated
for the immediately preceding four fiscal quarters, to fall below the
ratio shown below for each fiscal quarter ending during the stated
periods; provided that for the fiscal quarter ending on or about
December 31, 1993, the Adjusted Fixed Charge Coverage Ratio shall be
calculated for the period commencing on or about October 1, 1993 and
ending on such date and for the fiscal quarters ending on or about
March 31, 1994, June 30, 1994 and September 31, 1994, the Adjusted
Fixed Charge Coverage Ratio shall be calculated for the period
commencing on or about January 1, 1994 and ending on such date:
<PAGE> 3
INTERMET CORPORATION
November 16, 1993
Page 3
<TABLE>
<CAPTION>
Minimum Adjusted
Fixed Charge Coverage
Period Ratio
-------- ----------------------------
<S> <C>
Fourth Fiscal Quarter End 1993 -2.30:1.0
First Fiscal Quarter End 1994 0.10:1.0
Second Fiscal Quarter End 1994 1.35:1.0
Third Fiscal Quarter End 1994
and thereafter 1.50:1.0"
</TABLE>
6. Paragraph 6B(2) shall be amended by replacing clauses (2) and
(3) in the second sentence thereof with the following:
"(2) as of the last day of each fiscal quarter, Senior
Funded Debt to exceed the following percentage of Total Capitalization
as at each fiscal quarter ending during the stated periods:
<TABLE>
<CAPTION>
Period Ratio
------ -----
<S> <C>
Third Fiscal Quarter End 1993 through
Second Fiscal Quarter End 1994 52%
Third Fiscal Quarter End 1994 50%
Fourth Fiscal Quarter End 1994 through
First Fiscal Quarter End 1995 49%
Second Fiscal Quarter End 1995 and thereafter 45%
</TABLE>
(3) as of the last day of each fiscal quarter, the ratio
of Funded Debt to Consolidated EBITDAR, calculated for the immediately
proceeding four fiscal quarters, to exceed the ratio shown below for
each fiscal quarter ending during the stated periods:
<PAGE> 4
INTERMET CORPORATION
November 16, 1993
Page 4
<TABLE>
<CAPTION>
Period Ratio
------ -----
<S> <C>
Third Fiscal Quarter End 1993 through
Fourth Fiscal Quarter End 1993 3.651.0
First Fiscal Quarter End 1993 3.90:1.0
Second Fiscal Quarter End 1994 and thereafter 3.50:1.0;"
</TABLE>
7. Paragraph 10B of the Agreement shall be changed by adding the
following definitions in the appropriate alphabetical order:
""ADJUSTED CASH FLOW" shall mean, for any fiscal period of the
Company, Consolidated EBITDAR minus the sum of (i) Capital
Expenditures made by the Consolidated Companies during such fiscal
period and (ii) taxes on income paid by the Consolidated Companies in
cash (less cash refunds received) during such fiscal period to any
federal, state or local authorities, determined on a consolidated
basis in accordance with GAAP. Notwithstanding the foregoing, in the
event that any of the Consolidated Companies receives a refund of
taxes during the fourth fiscal quarter of 1993, such amount shall be
added back to offset the payment of income taxes pursuant to
subsection (ii) above in the first fiscal quarter of 1994.
"ADJUSTED FIXED CHARGE COVERAGE RATIO" shall mean, with
respect to any fiscal period of the Company, the ratio of (A) Adjusted
Cash Flow to (B) the sum of (i) Consolidated Interest Expense paid in
cash during such fiscal period, (ii) Consolidated Rental Expense paid
in cash during such fiscal period, and (iii) scheduled principal
reductions of Funded Debt of the Consolidated Companies paid in cash
during such fiscal period, as determined on a consolidated basis in
accordance with GAAP.
"CAPITAL EXPENDITURES" shall mean, for any fiscal period of
the Company, the sum of (i) cash expenditures by the Consolidated
Companies during that fiscal period that, in conformity with GAAP, are
included in "capital expenditures", "additions to property, plant or
equipment" or comparable items in the financial statements of the
Consolidated Companies, and (ii) to the extent not included in clause
(i) above, cash expenditures for all net non-current assets of
businesses acquired by the Consolidated Companies during that period,
including all purchase price adjustments, other than such assets
acquired in transactions where all or substantially all of the
consideration paid for such assets consisted of capital stock of a
Consolidated Company.
<PAGE> 5
INTERMET CORPORATION
November 16, 1993
Page 5
"CONSOLIDATED EBITDAR" shall mean, for any fiscal period of
the Company, an amount equal to (A) minus (B), where:
(A) is the sum for such fiscal period of Consolidated Net
Income (Loss) and, to the extent subtracted in determining
such Consolidated Net Income (Loss), provisions for:
(i) taxes based on income,
(ii) Consolidated Interest Expense to the extent
paid in cash,
(iii) Consolidated Rental Expense to the extent
paid in cash,
(iv) charges taken in conformity with FASB 106
prior to fiscal year-end 1993, and
(v) depreciation and amortization expense of the
Consolidated Companies during such period, and
(B) is any items of gain (or plus any items of loss)
which were included in determining such Consolidated Net
Income (Loss) and were (x) not realized in the ordinary course
of business (whether or not classified as "ordinary" by GAAP),
(y) the result of any sale of assets, or (z) resulting from
minority investments."
8. These changes to the Agreement shall become effective when:
(a) you have signed and returned to us two of the
enclosed copies of this letter;
(b) you have signed and returned to us an original Note
in the form attached as Exhibit A to this letter;
(c) you have provided to us a copy of a signed Waiver and
Third Amendment to Credit Agreement in the form attached as Exhibit B
to this letter;
(d) the Guarantors have signed and returned to us the
Consent and Ratification of Guarantors attached to this letter;
<PAGE> 6
INTERMET CORPORATION
November 16, 1993
Page 6
(e) Kilpatrick and Cody, or other counsel acceptable to
us, have provided to us a favorable opinion satisfactory to us and
substantially in the form attached as Exhibit C to this letter;
(f) you have paid to us, by check or wire transfer of
immediately available funds, a modification fee of $20,000.00.
9. Prudential hereby consents to the amendment of the Bank
Agreement pursuant to the terms of the Waiver and Third Amendment to Credit
Agreement in the form attached as Exhibit B to this letter.
10. All of the terms, conditions and obligations under the
Agreement shall remain in full force and effect as amended herein.
11. This letter may be signed in any number of counterparts which
will constitute one agreement when taken together. This letter shall also be
construed and enforced in accordance with the laws of New York, without regard
to its principles of conflicts of laws.
12. The entire agreement of Prudential and the Company on the
modification of the Agreement is set forth above, and supersedes any other
prior or different agreement or understanding on such modification.
[Signatures on next page]
<PAGE> 7
INTERMET CORPORATION
November 16, 1993
Page 7
If you agree to the foregoing, please sign each copy of this letter
enclosed and return two of them to us, together with the required documents
described in paragraph 8 above.
Very truly yours,
THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA
By:
----------------------------
Vice President
Agreed to and accepted this
November ___, 1993
INTERMET CORPORATION
By:
------------------------------
Title:
-----------------------
<PAGE> 8
CONSENT AND RATIFICATION OF GUARANTORS
Each of the undersigned Guarantors acknowledges the changes to
the Note Agreement, as amended, between INTERMET CORPORATION and THE PRUDENTIAL
INSURANCE COMPANY OF AMERICA, dated as of December 11, 1992, to be effected by
the letter agreement to which this Consent and Ratification of Guarantors is
attached and further agrees that the SUBSIDIARY GUARANTY AGREEMENT dated as of
December 11, 1992, to which it is a party shall remain in full force and effect
after giving effect to those changes.
November ___, 1993.
INTERMET FOUNDRIES, INC.
COLUMBUS FOUNDRIES, INC.
LYNCHBURG FOUNDRY COMPANY
IRONTON IRON, INC.
NORTHERN CASTINGS CORPORATION
PENNSYLVANIA CASTINGS CORPORATION
INTERMET INTERNATIONAL, INC.
INTERMET MACHINING, INC.
COMMERCIAL AND PRECISION MACHINING,
INC.
PBM INDUSTRIES, INC.
INTERMOTIVE TECHNOLOGIES, INC.
NEW RIVER CASTINGS COMPANY
INTERMET ALUMINUM, INC.
I.C. VENTURE, INC.
By:
----------------------------------
Title:
---------------------------
Attest:
------------------------------
Title:
-----------------------
<PAGE> 9
EXHIBIT C
[FORM OF OPINION OF COMPANY'S COUNSEL]
[Date of Closing]
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
c/o Prudential Capital Group
Four Gateway Center
100 Mulberry Street
Newark, New Jersey 07102
LADIES AND GENTLEMEN:
We have acted as counsel for INTERMET CORPORATION (the "Company") in connection
with the letter agreement dated November 16, 1993, between the Company and you
(the "Letter Agreement"), pursuant to which the NOTE AGREEMENT, dated December
11, 1992, as amended, between the Company and you has been further amended and
the Company has issued to you today its Senior Note due December 1, 2002, in
the aggregate principal amount of $25,000,000 (the "Note"). All terms used
herein that are defined in the Letter Agreement have the respective meanings
specified in the Letter Agreement. This letter is being delivered to you in
satisfaction of the condition set forth in paragraph 8 of the Letter Agreement
and with the understanding that you are accepting the Note in reliance on the
opinions expressed herein.
In this connection, we have examined executed originals of the Letter Agreement
and Note, certificates of officers of the Company and copies certified to our
satisfaction of corporate documents and records of the Company and of other
papers, and have made such other investigations, as we have deemed relevant and
necessary as a basis for our opinion hereinafter set forth. We have relied
upon such certificates of officers of the Company with respect to the accuracy
of material factual matters contained therein which were not independently
established.
Based on the foregoing, it is our opinion that:
1. The Company is a corporation validly existing and in
good standing under the laws of the State of Georgia.
2. The Letter Agreement and Note have been duly
authorized by all necessary corporate action on the part of the Company and
have been duly executed and delivered by the Company.
<PAGE> 10
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
[Date of Closing]
Page 2
3. The Letter Agreement and Note have been duly
authorized by all requisite corporate action and duly executed and delivered by
authorized officers of the Company, and are valid obligations of the Company,
legally binding upon and enforceable against the Company in accordance with
their respective terms, except as such enforceability may be limited by (a)
bankruptcy, insolvency, reorganization or other similar laws affecting the
enforcement of creditors' rights generally and (b) general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law). The Note is entitled to the benefits of the Note Agreement.
4. It is not necessary in connection with the issuance
and delivery of the Note under the circumstances contemplated by the Letter
Agreement to register the Note under the Securities Act or to qualify an
indenture in respect of the Notes under the Trust Indenture Act of 1939, as
amended.
5. The extension, arranging and obtaining of the credit
represented by the Note do not result in any violation of Regulation G, T or X
of the Board of Governors of the Federal Reserve System.
6. The execution and delivery of the Letter Agreement
and the Note, the issuance of the Note and the Company's performance of its
obligations under the Letter Agreement and Note does not conflict with, or
result in a breach of the terms, conditions or provisions of, or constitute a
default under, or result in any violation of, or result in the creation of any
Lien upon any of the properties or assets of the Company pursuant to, or
require any authorization, consent, approval, exemption or other action by or
notice to or filing with any court, administrative or governmental body or
other Person (other than routine filings after the date hereof with the
Securities and Exchange Commission and/or state Blue Sky authorities) pursuant
to, the charter or by-laws of the Company, any law (including any securities
or Blue Sky law), statute, rule or regulation applicable to the Company or to
our knowledge, any agreement, instrument, order, judgment or decree to which
the Company is a party or otherwise subject.
7. The substantive laws of the State of New York
(including laws relating to usury) would govern the transactions contemplated
by the Letter Agreement and the Note (including, without limitation, the rates
of interest payable with respect to the Note), and a State court of Georgia or
a Federal court applying the conflicts of law rules of the State of Georgia
would apply the substantive laws of the State of New York with respect to the
Letter Agreement and the Note and the transactions contemplated thereby,
including, without limitation, all matters relating to the validity,
enforceability and construction thereof.
This opinion may be relied upon by any Transferee.
Very truly yours,
<PAGE> 11
EXHIBIT A
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT
BE OFFERED OR SOLD IN VIOLATION OF SUCH ACT.
SENIOR NOTE DUE DECEMBER 11, 2002
No. R-2 As of December 12, 1993
$25,000,000
FOR VALUE RECEIVED, the undersigned, INTERMET CORPORATION (herein
called "Company"), a corporation organized and existing under the laws of the
State of Georgia, hereby promises to pay to THE PRUDENTIAL INSURANCE COMPANY OF
AMERICA, or registered assigns, the principal sum of TWENTY FIVE MILLION
DOLLARS on December 11, 2002, with interest (computed on the basis of a 360-day
year--30-day month) (a) on the unpaid principal balance thereof at the
Specified Rate (as defined below) per annum from the date hereof, payable
quarterly on the 11th day of March, June, September and December in each year,
commencing with the March, June, September or December next succeeding the date
hereof, until the principal hereof shall have become due and payable, and (b)
on any overdue payment (including any overdue prepayment) of principal, any
overdue payment of interest and any overdue payment of any Yield-Maintenance
amount (as defined in the Note Agreement referred to below), payable quarterly
as aforesaid (or, at the option of the registered holder hereof, on demand), at
a rate per annum from time to time equal to the greater of (i) 2.0% over the
Specified Rate then in effect or (ii) 2.0% over the rate of interest publicly
announced by Morgan Guaranty Trust Company of New York from time to time in New
York City as its Prime Rate.
The term "Specified Rate" as used in this Note shall mean the sum of
8.05% per annum and Additional Interest per annum, if any, as determined below.
For the period from December 12, 1993 through June 11, 1994, Additional
Interest is 1.00% per annum and thereafter, is that amount shown below based on
two factors:
(1) the Fixed Charge Coverage Ratio as of the last day of each
fiscal quarter (or fiscal year end, as the case may be) of the
Company, commencing with the fiscal quarter ending on or about
March 31, 1994), calculated for the immediately four fiscal
quarters of the Company, and
(2) percentage of Total Capitalization comprised of Senior Funded
Debt of the Consolidated Companies as of the last day of each
fiscal quarter (or fiscal year end, as the case may be) of the
Company, commencing with the fiscal quarter ending on or about
March 31, 1994.
The amount of Additional Interest determined as of the last day of each fiscal
quarter (or fiscal year, as the case may be) of the Company shall be effective
as of the 12th day of the March, June, September or December next succeeding,
commencing June 12, 1994.
<PAGE> 12
<TABLE>
<CAPTION>
Senior Funded Debt %
of Total Capitalization
--------------------------------------------------------------------------------
Greater than 45%-
Less Than or Equal to 45% Less Than or Equal to 50% Greater Than 50%
------------------------- ------------------------- ----------------
Fixed Charge
Coverage Ratio(1) % Per Annum
- ----------------- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Greater Than 2.00:1.0 0 .50 1.00
Greater Than 1.5:1.00 -
Less Than or Equal to 2.00:1.0 .75 .75 1.00
Less Than or Equal to 1.5:1.00 1.00 1.00 1.00
____________________
(1) Calculated for the immediately preceding four fiscal quarters
</TABLE>
If, however, the amount of Additional Interest determined under the foregoing
matrix is zero for four consecutive fiscal quarters of the Company, then the
Specified Rate of interest on this Note shall be 8.05% per annum at all times
thereafter.
Payments of principal or interest on any Yield-Maintenance Amount
payable with respect to this Note are to be made at the main office of Morgan
Guaranty Trust Company of New York in New York City or at such other place as
the holder hereof shall designate to the Company in writing, in lawful money
of the United States of America.
This Note is one of a series of Senior Notes (herein called the
"Notes") issued pursuant to a Note Agreement, dated as of December 11, 1992, as
amended (herein called the "Agreement"), between the Company and The Prudential
Insurance Company of America and is entitled to the benefits thereof.
This Note is a registered Note and, as provided in the Agreement, upon
surrender of this Note for registration of transfer, duly endorsed, or
accompanied by a written instrument of transfer duly executed, by the registered
holder hereof or such holder's attorney duly authorized in writing, a new
Note for a like principal amount will be issued to, and registered in the name
of, the transferee. Prior to due presentment for registration of transfer,
the Company may treat the person in whose name this Note is registered as
the owner hereof for the purpose of receiving payment and for all other
purposes, and the Company shall not be affected by any notice to the contrary.
- 2 -
<PAGE> 13
The Company agrees to make prepayments of principal on the dates and
in the amounts specified in the Agreement. This Note is also subject to
optional prepayment, in whole or from time to time in part, on the terms
specified in the Agreement.
In case an Event of Default, as defined in the Agreement, shall occur
and be continuing,the principal of this Note may be declared or otherwise
become due and payable in the manner and with the effect provided in the
Agreement.
This Note is intended to be performed in the State of New York and
shall be construed and enforced in accordance with the law of such State. AS
PROVIDED IN PARAGRAPH 11Q OF THE AGREEMENT, THE COMPANY SUBMITS TO THE
JURISDICTION OF THE SUPREME COURT OF THE STATE OF NEW YORK LOCATED IN NEW YORK
COUNTY, NEW YORK AND THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT
OF NEW YORK IN ANY ACTION OR PROCEEDING RELATING TO THIS NOTE.
INTERMET CORPORATION
By:
----------------------
John D. Ernst
Vice President-Finance
- 3 -
<PAGE> 1
EXHIBIT 10.14(e)
AMENDMENT NO. 4 TO THE
INTERMET CORPORATION EMPLOYEE STOCK
OWNERSHIP PLAN AND TRUST (1987)
(As Adopted Effective As of January 1, 1987)
This Amendment made and entered into as of this 1st day of October,
1993, by and between Intermet Corporation, a Georgia corporation (referred to
as the "Employer"), and Trust Company Bank, as trustee (referred to herein as
the "Trustee");
W I T N E S S E T H:
WHEREAS, the Employer previously established for the exclusive benefit
of its eligible employees the Intermet Corporation Employee Stock Ownership
Plan and Trust (1987) (the "Plan"); and
WHEREAS, the Plan has been amended from time to time; and
WHEREAS, effective October 1, 1993, the Employer adopted a special
voluntary severance plan for eligible salaried employees of Intermet Foundries,
Inc. and its subsidiaries, known as the 1993 Special Voluntary Severance Plan
for Salaried Employees of Intermet Foundries, Inc. and Its Subsidiaries (the
"1993 Special Voluntary Severance Plan"); and
WHEREAS, because Participants who elect to resign from employment
under the 1993 Special Voluntary Severance Plan will cease employment with the
Employer and active participation under this Plan effective as of their
"Severance Date," as that term is defined in the 1993 Special Voluntary
Severance Plan, the parties desire to amend the Plan to provide special
provisions for Participants electing to participate in the 1993 Special
<PAGE> 2
Voluntary Severance Plan and to clarify the Plan's provisions relating to
severance pay;
NOW, THEREFORE, for and in consideration of the premises and mutual
covenants contained herein, the parties hereto agree as follows:
1.
Section 1.2 is hereby amended by adding the following at the end of
the present section:
"Annual Compensation shall not include any amounts paid to a
Participant or former Participant as severance pay pursuant to
any plan, program or policy of the Employer."
2.
Article II is hereby amended by adding the following new Section 2.9:
"2.9 Participation in the 1993 Special Voluntary Severance
Plan -
(a) In General - This Section shall apply only to those
Participants who are eligible for, and elect to participate
in, the 1993 Special Voluntary Severance Plan for Salaried
Employees of Intermet Foundries, Inc. and Its Subsidiaries
(the "1993 Special Voluntary Severance Plan"). The terms
"Severance Date" and "Severance Pay" shall have the meanings
given them under the 1993 Special Voluntary Severance Plan,
and such definitions are expressly incorporated herein by
reference. Notwithstanding the provisions of this Section
2.9, the Employer may restrict the benefits of any Highly
Compensated Employee in order to satisfy the applicable
non-discrimination requirements of the Code.
(b) Service - Except as otherwise provided in this
Section 2.9, a Participant who elects to participate in the
1993 Special Voluntary Severance Plan shall cease active
participation in this Plan for all purposes effective as of
his Severance Date. Such Participant shall not be eligible to
participate in Employer Contributions or allocations of
Forfeitures, pursuant
-2-
<PAGE> 3
to Sections 3.1, 4.3 and 4.4 of the Plan for the period that
such Participant receives Severance Pay.
(c) 1993 Employer Contributions - For the Plan Year
ending December 31, 1993 only (the "1993 Plan Year"), the
Employer shall make a one-time Employer Contribution pursuant
to Section 3.1 of the Plan for each Participant who: (i)
elects to participate in the 1993 Special Voluntary Severance
Plan; (ii) has a Severance Date prior to December 31, 1993;
and (iii) has a Year of Service for the 1993 Plan Year.
(d) Annual Compensation - For purposes of the Employer
Contribution made under this Section 2.9, Annual Compensation
shall only include a Participant's Annual Compensation
received through the Participant's Severance Date and shall
not include any Severance Pay.
(e) Early or Normal Retirement - A Participant who is
eligible for, and elects to participate in, the 1993 Special
Voluntary Severance Plan, but who does not satisfy the
requirements of Section 5.1 as of his Severance Date, shall be
granted such additional age and/or service under this Plan so
that he satisfies the requirements of Section 5.1(a) or 5.1(b)
of the Plan as of his Severance Date, without regard to the
Participant's actual Severance Date under the 1993 Special
Voluntary Severance Plan."
4.
The provisions of this Amendment No. 4 shall be effective as of
October 1, 1993.
5.
Except as hereby modified, the Plan shall remain in full force and
effect.
-3-
<PAGE> 4
IN WITNESS WHEREOF, the parties have caused this Amendment No. 4 to be
duly executed as of the day and the year first above written.
EMPLOYER: TRUSTEE:
INTERMET CORPORATION TRUST COMPANY BANK
By: /s/ John D. Ernst By: /s/
--------------------------- ----------------------
Title: Vice President Finance Title: Vice President
------------------------ -------------------
-4-
<PAGE> 1
EXHIBIT 10.15
CONFIDENTIAL
MANAGEMENT BONUS PLAN
FOR
INTERMET CORPORATION
MASTER COPY
1993
<PAGE> 2
TABLE OF CONTENTS
Page
I. Introduction 1
II. Purpose of the Plan 1
III. Definitions 1
IV. Participation 3
V. Bonus Potential 4
VI. Objective Setting and Performance Measurement 5
VII. Actual Bonuses 5
VIII. Form and Timing of Bonus Payments 8
IX. Administration of the Plan 9
X. Additional Provisions 9
XI. Exhibit 1 - Participants and Target Bonuses
<PAGE> 3
I. INTRODUCTION
The compensation strategy of Intermet Corporation (the Company) includes
providing its executives and certain other employees the opportunity to earn
annual bonuses based upon Company and/or organizational unit performance during
the year. This document contains the guidelines for implementing the
Management Bonus Plan (the Plan), which provides for cash payments of bonuses
based on achievement of Company and organizational unit objectives for the
Performance Period.
II. PURPOSE OF THE PLAN
The purpose of the Plan is to enable the Company to:
- attract and retain executives and other key employees by
providing a competitive annual bonus opportunity, and
- motivate and reward executives and other employees for their
success in accomplishing Performance Period objectives.
The remainder of the Plan document describes the essential elements for
administering the Plan, including definitions of terms, selection of
participants, bonus potential, objective setting and performance measurement,
bonus payouts, and other provisions.
III. DEFINITIONS
The following terms shall have the meanings indicated for purposes of the Plan:
(a) "Actual Bonus" shall mean the amount of any Annual Bonuses earned
by the Participant for the Plan Period. The Compensation
Committee shall approve the Actual Bonuses for all Participants.
(b) "Annual Bonus" or "Bonus" shall mean a cash bonus payment under
this Plan which is contingent upon the achievement of Company
and/or organizational unit objectives.
(c) "Board" shall mean the Board of Directors of the Company.
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<PAGE> 4
(d) "Cause" shall mean a felony conviction of a Participant or the
failure of a Participant to contest prosecution for a felony,
or a Participant's willful misconduct or dishonesty which is
harmful to the business or reputation of the Company or a
Subsidiary, or a Participant's willful and substantial
non-performance of assigned duties. The determination of
"Cause" shall be made by the Compensation Committee based upon
the information available to it and any such determination
shall be final and binding on the affected Participant.
(e) "Company" shall mean Intermet Corporation, a Georgia
corporation, its successors or assigns.
(f) "Compensation Committee of the Board of Directors" or
"Compensation Committee" shall mean the directors of the Company
who shall be appointed from time to time by the Board, and who
shall oversee the setting of compensation for the Company's
executive officers and key personnel, including the development,
interpretation, and administration of the Management Bonus Plan.
(g) "Disability" shall mean total and permanent disability that
would qualify a Participant for benefits under the Company's
long-term disability plan or if such plan is not in existence, as
determined by the Compensation Committee.
(h) "Measurement Date" shall mean the last day of Plan Year.
(i) "Objectives" shall mean the financial and/or other measures
selected to gauge performance during a Performance Period.
(j) "Organizational Unit" shall mean either one, or more than one,
of the principal companies that collectively form Intermet
Corporation, or any facility or departmental entity for which a
performance objective has been established.
(k) "Participant" shall mean any executive or other key employee of
the Company or a Subsidiary who is selected by the Compensation
Committee, or the Compensation Committee's designated appointee,
to be a Participant under the Plan with respect to a Plan Year.
Participants shall be designated for each Plan Year and shall be
listed in Exhibit 1. Participants shall be designated as either
a Corporate Participant, or an Organizational Unit Participant.
(l) "Performance Period" shall mean the fiscal year for which
Company and/or organizational unit objectives are established.
Its meaning is the same as Plan Year.
-2-
<PAGE> 5
(m) "Plan" shall mean the Management Bonus Plan of Intermet
Corporation set forth herein (including all Exhibits) and as it
may be amended from time to time.
(n) "Plan Year" shall mean the Company's fiscal year beginning on or
about January 1.
(o) "Retirement" shall mean normal or early retirement of a
Participant under the provisions of a company retirement plan.
(p) "Subsidiary" shall mean any corporation of which 50% or more of
the common stock is owned by the Company, or of which 50% or
more of the common stock is owned by another subsidiary.
(q) "Target Bonus" shall mean the Target Annual Bonus, expressed as
a percent of salary for the Plan Year, and it shall be one
factor in determining the Actual Bonus, if any, as of the
Measurement Date. Target Bonuses shall be approved by the
Compensation Committee, or the Compensation Committee's
designated appointee, for each Participant on or as close as
possible to the beginning of the Plan Year and shall be
designated in Exhibit 1.
IV. PARTICIPATION
Participants in the Plan are selected by the Compensation Committee.
Participants shall be notified of their selection to participate in the Plan on
or before the beginning of the Plan Year, or as soon thereafter as is
practicable. Selection of Participants shall apply only to the applicable Plan
Year; selection to participate in one Plan Year is no guarantee of
participation in future Plan Years. Participants may include the executive
officers and other key employees of the Company or a Subsidiary who may be
selected from time to time by the Compensation Committee in their sole
discretion. Participants will be selected, among other things, based on their
ability to impact the company's achievement of its Performance Period
objectives. All Participants must be employed by Intermet Corporation or a
Subsidiary of the Company, on the first day of the Plan Year and maintain
continuous employment in the same or a similar position through the end of the
Plan Year. The Compensation Committee, in their sole discretion, may approve
the participation of an executive officer or other key employee who through
internal
-3-
<PAGE> 6
promotion or recruitment (or other similar reasons) fills a position after the
beginning of the Plan Year but may have a significant impact on the Company's
achievement of its Objectives for the Plan Year. In that event, the
Participant may earn a pro rata Bonus, contingent upon Company and/or
Organizational Unit performance. Participants who terminate employment with
the Company or a subsidiary for any reason prior to the end of the Plan Year,
forfeit any Bonus which they could have earned under the Plan Year. The
Compensation Committee, in their sole discretion, may approve the payment of
pro rata awards to a Participant who terminates employment during a Plan Year
due to death, Disability, or Retirement or other termination of employment by
the Company or a Subsidiary for a reason other than Cause. Any such payments
would be made after the end of the Plan Year at the same time and in the same
manner that Annual Bonuses are paid to other Participants. No such payments
may be authorized under this Plant to a Participant whose employment is
terminated for Cause.
In the event that a Participant terminates employment with the Company or a
Subsidiary for any reason following the end of the Plan Year but prior to
payment of any Actual Bonus, any unpaid Actual Bonus shall be forfeited, and
the Participant shall have no further right, title, or interest under the Plan;
provided however that this forfeiture provision shall not apply where such
termination is by reason of the Participant's death, Disability, or Retirement
or termination of employment (whether voluntary or involuntary) for a reason
other than Cause, in which event the payment of the Actual Bonus shall be made
in the normal course in accordance with the Plan. The Compensation Committee
may, in its discretion, approve the payment of all or part of the Actual Bonus
to other Participants who terminated employment after the end of the Plan Year
but prior to the payment date, provided, however, that such payments may be
authorized to a Participant whose employment is terminated for Cause.
V. BONUS POTENTIAL
The Plan allows each Participant to earn an Annual Bonus contingent upon the
results achieved during the Plan Year. Each Participant's Annual Bonus
potential is established on or as close as possible to the beginning of the
Plan Year. The bonus potential, or Target Bonus, for the Plan Year is
expressed as a percentage of base salary, and it is intended to provide a
competitive Annual Bonus, contingent upon performance. Target Bonuses for each
Participant for the Plan Year are shown in Exhibit 1.
The Compensation Committee establishes the Target Bonus for each Participant.
The extent to which the Target Bonus is earned will be approved by the
Compensation Committee after the end of the Plan Year based on actual results
achieved. The value of any Actual Bonus may be greater than or less than the
Target Bonus, depending upon performance during the Plan Year.
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<PAGE> 7
VI. OBJECTIVE SETTING AND PERFORMANCE MEASUREMENT
The Plan is intended to reward Participants for contributing to the achievement
of Company Objectives and accomplishing Organizational Unit Objectives for the
Performance Period. The Compensation Committee establishes the Company
Objectives at or near the beginning of the Plan Year. The Company Objective
guide the development of Organizational Unit Objectives for Participants in the
Plan.
Company Objectives will be comprised of one or more measures of Company, and/or
Organizational Unit, financial performance. For each Objective, the
Compensation Committee will establish a range of performance defined by a
target, minimum, and maximum level. The target represents the planned level of
performance (100% achievement of the Objective). The minimum represents the
lowest level of performance at which Bonuses may begin to be earned. This
typically will be 80% of the target. The maximum represents the highest level
of performance which is likely to be attained during the Performance Period.
This typically will be 120% of the target.
After the end of the Plan Year, when final result are known, the Compensation
Committee will determine how Company performance and Organizational Unit
performance compared to the Performance Period Objectives. Based on these
evaluations of performance, Participants may earn Bonuses under this under
Plan.
VII. ACTUAL BONUSES
The Company's financial performance determines if Actual Bonuses can be paid to
Participants. The Company's financial performance measure that will be used
for Plan payout purposes is determined annually.
The threshold point for paying Actual Bonuses is the Company's financial
performance measure reaching 80% of its target. If the Company achieves 80% of
its target, then Participants' Bonuses will be paid. If the Company does not
achieve 80% of its target, then no Participant will be paid a Bonus.
A. Corporate Participants
At the end of a Performance Period, the following table will be used to measure
the Company's financial performance and to calculate a Participant's Actual
Bonus.
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<PAGE> 8
<TABLE>
<CAPTION>
COLUMN A COLUMN B
-------- --------
<S> <C>
Percent of
The Company's
Actual Financial Performance A Participant's Target Bonus
vs. Is Multiplied
Financial Performance Target By This Percentage
Less Than 80% 0%
80% 50%
90% 75%
100% 100%
110% 125%
120% 150%
Greater Than 120% 150%
</TABLE>
If the Company achieves 100% of its financial performance target (Column A), a
Participant's Target Bonus would be multiplied by 100% (Column B) to determine
the Participant's Actual Bonus. If the Company reaches 120% of its financial
performance target, a Participant's Target Bonus would be multiplied by 150%.
Similarly, if the Company reaches only 80% of its financial performance target,
a Participant's Target Bonus would be multiplied by 50%.
If financial performance attainment equals a percentage other than one
displaced in Column A, then the accompanying bonus percentage from Column B is
interpolated mathematically.
B. Organizational Unit Participants
An Organizational Unit Participant's Target Bonus is split into two components.
Forty percent of the Participant's Target Bonus is based on the Company's
financial performance. The remaining 60% of a Participant's Target Bonus is
based on the Participant's Organizational Unit's performance. The Company's
financial performance, in conjunction with the Participant's Organizational
Unit's performance, determines the Participant's Actual Bonus.
-6-
<PAGE> 9
The first component of an Organizational Unit Participant's Actual Bonus is
calculated using Table I. Table I outlines how 40% of a Participant's Target
Bonus is impacted by the Company's financial performance. If the Company's
financial performance reaches 80% of its target (Table I, Column A), 40% of an
Organizational Unit Participant's Target Bonus would be paid at the 50% level
(Table I, Column B). If 100% of the Company's financial performance target is
reached, 40% of the Organizational Unit Participant's Target Bonus would be
paid at 100% level. Likewise, 120% financial performance achievement would
result in 40% of the Organizational Unit Participant's Target Bonus being paid
at the 150% level.
<TABLE>
<CAPTION>
TABLE I
COLUMN A COLUMN B
-------- --------
<S> <C>
Percent of
The Company's 40% of a Participant's
Actual Financial Performance Target Bonus
vs. Is Multiplied
Financial Performance Target By This Percentage
Less Than 80% 0%
80% 50%
90% 75%
100% 100%
110% 125%
120% 150%
Greater Than 120% 150%
</TABLE>
If financial performance attainment equals a percentage other than one
displayed in Column A, then the accompanying bonus percentage from Column B is
interpolated mathematically.
If the Company's financial performance is greater than or equal to 80% of its
financial performance target, Table II will be used to assess a Participant's
Organizational Unit's financial performance and the second component of an
Organizational Unit Participant's Actual Bonus will be calculated. If a
Participant's Organizational Unit's financial performance is less than 80% of
its financial performance target, the Organizational Unit Participant would
still receive the component of his Bonus that is based on the Company's
financial performance. If the Company's financial performance is less than 80%
of its financial performance target, no Bonus based upon an Organizational
Unit's Financial Performance will be paid.
-7-
<PAGE> 10
<TABLE>
<CAPTION>
TABLE II
COLUMN A COLUMN B
-------- --------
<S> <C>
Percent of
Organizational Unit's 60% of a Participant's
Actual Financial Performance Target Bonus
vs. Is Multiplied
Financial Performance Target By This Percentage
Less Than 80% 0%
80% 50%
90% 75%
100% 100%
110% 125%
120% 150%
Greater Than 120% 150%
</TABLE>
If a Participant's Organizational Unit achieves 100% of its financial
performance target (Table II, Column A), 60% of an Organizational Unit
Participant's Target Bonus would be multiplied by 100% (Table II, Column B) to
determine the second component of the Organizational Unit Participant's Actual
Bonus. If a Participant's Organizational Unit reaches 120% of its financial
performance target, 60% of an Organizational Unit Participant's Target Bonus
would be multiplied by 150%. Similarly, if a Participant's Organizational Unit
reaches only 80% of its financial performance target, 60% of an Organizational
Unit Participant's Target Bonus would be multiplied by 50%.
If financial performance attainment equals a percentage other than one
displayed in Column A, then the accompanying bonus percentage from Column B is
interpolated mathematically.
VIII. FORM AND TIMING OF BONUS PAYMENTS
Actual Bonuses, if any, will be approved by the Compensation Committee and will
be paid in cash in a lump sum after the end of the Plan Year when final results
are known and performance against Objectives can be determined. Payment will
be made no later than March 15 of the calendar year following the Plan Year.
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<PAGE> 11
IX. ADMINISTRATION OF THE PLAN
The Compensation Committee is responsible for the maintenance and
administration of the Plan. Those activities include but are not limited to
selecting Participants, maintaining a list of current Participants,
establishing Company and Organizational Unit Objectives, establishing a Target
Bonus for each Participant, monitoring performance during the Plan Year,
measuring performance at the end of the period, approving the amount of any
Actual Bonuses, and directing that Actual Bonuses be paid to eligible
Participants. The Board is responsible for approving the Compensation
Committee's recommendations.
X. ADDITIONAL PROVISIONS
A. Amendment or Termination
The Company may amend, alter, or discontinue the Plan at any time without prior
notice, subject to the following limitations:
(i) No such termination or amendment shall adversely affect the
right, title or interest of the Participant in an Actual Bonus
for which the Plan Year has already ended, and the Plan shall
continue with respect to the Actual Bonus on its original
terms until such Actual Bonus has been paid in full.
(ii) In the event of any Plan termination, or in the event of an
amendment which shall adversely affect the right, title or
interest of the Participant with respect to such Plan Year,
any uncompleted Plan Year shall be deemed to have ended on the
effective date of such termination or amendment, performance
shall thereupon be administered in accordance with Article VI
and, assuming the Compensation Committee determine the
performance criteria have been met, pro rata awards will be
paid based upon the portion of the Plan Year which elapsed
between the beginning of the Plan Year and the date of such
termination or amendment.
B. Effective Date of the Plan
The Plan shall become effective upon its approval by the Company. It shall
continue in effect until such time as the Company chooses to discontinue the
Plan. Initial implementation of the Plan may be made retroactive to the
beginning of the fiscal year in which the Plan is adopted.
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<PAGE> 12
C. Authority of the Compensation Committee
The construction and interpretation of the Plan by the Compensation Committee
shall be final and binding upon the Company and all Participants. The
authority of the Compensation Committee shall specifically include, but not be
limited to the resolution, in accordance with the Plan, of any issue regarding
establishing or amending annual Objectives, evaluating Company or Organization
Unit performance relative to the annual Objectives, determining the extent to
which any Target Bonuses were earned, and determining whether any Actual
Bonuses are payable.
D. Delegation
The Compensation Committee may delegate a portion of their duties to an officer
or other employee or group thereof, of the Company.
E. Records and Rules
The Company shall keep written records sufficient to reflect the identity of
Participants in each Plan Year, their Target Bonuses, any Company or
Organizational Unit Objectives for the Plan Year and the Determination of
Actual Bonuses. The Company may adopt such rules as it shall deem reasonable
and appropriate to the administration of the Plan.
F. Employment and Other Rights
Nothing contained herein shall require the Company to continue any Participant
in the Company's or a Subsidiary's employ, or require any Participant to
continue in the Employ of the Company or a Subsidiary, nor does the Plan create
any rights of any Participant, or Beneficiary or any obligations on the part of
the Company or a Subsidiary other than those set forth herein. The Actual
Bonuses payable under this Plan shall be independent of any and in addition to,
any other agreements that may exist from time to time concerning any other
compensation or benefits payable by the Company or a Subsidiary.
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<PAGE> 13
G. Right to Benefits
The sole interest of each Participant under the Plan shall be to receive the
Actual Bonuses provided herein, if and when the same shall become due and
payable in accordance with the terms hereof, and no Participant shall have any
right, title or interest in or to any of the specific assets of the Company or
a Subsidiary. All Actual Bonuses hereunder shall be paid solely from the
general assets of the Company and no employer shall maintain any separate fund
or their segregated assets to provide any benefits hereunder. In no manner
shall any assets of the Company or a Subsidiary be deemed or construed through
any of the provisions of this Plan to be held in trust for the benefit of any
Participant or to be collateral security for the performance of the obligations
imposed by the Plan on the Company. The rights of any Participant shall be
solely those of a general unsecured creditor of the Company, as determined
under applicable law.
H. Offset to Benefits
Any other provision of the Plan to the contrary notwithstanding, the Company
may, if the Compensation Committee in their sole and absolute discretion shall
determine, offset against any amounts to be paid to a Participant under the
Plan any amounts which such Participant may owe to the Company or a Subsidiary.
I. Nonalienation of Benefits
Except as otherwise mandated by law, no benefit, payment or distribution under
this Plan shall be subject either to the claim of any creditor of a
Participant, or to attachment, garnishment, levy, execution or other legal or
equitable process, by any creditor of such person, and no such person shall
have any right to alienate, commute, anticipate or assign (either at law or
equity) all or any portion of any benefit, payment or distribution under this
Plan. The Plan shall not in any manner be liable for or subject to the debts,
contracts, liabilities, engagements or torts of any person entitled to benefits
hereunder.
In the event that any Participant's benefits are garnished or attached by order
of any court, the Company may elect to bring an action for a declaratory
judgment in a court of competent jurisdiction to determine the proper recipient
of the benefits to be paid by the Plan. During the pendency of said action,
any benefits that become payable may be paid into the court as they become
payable, to be distributed by the court to the recipient as it deems proper at
the close of said action.
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<PAGE> 14
J. Withholding and Deductions
All payments made by the Company or a Subsidiary under the Plan to any
Participants shall be subject to applicable withholding and to such other
deductions as shall at the time of such payment be required under any income
tax or other law, whether of the United States or any other jurisdiction.
Determinations by the Company as to withholding with respect thereto shall be
binding on the Participant.
K. Merger/Consolidation/Change of Control
In the event that the Company or a Subsidiary shall merge or consolidate with
any other corporation or organization, or its business activities are taken
over by any other organization, and such succeeding or continuing corporation
or other organization shall fail to expressly assume the rights and obligations
of such employer under the Plan and agree to continue the Plan for the Plan
Year, the date immediately prior to the date of such merger, consolidation or
takeover shall be deemed the date of termination of the Plan and Participants
shall be entitled to benefits in accordance with Article X, A(ii). Any Actual
Bonus which has been approved by the Compensation Committee but has not been
paid prior to the date of such merger, consolidation or change of control shall
continue as an obligation of the Company or of such succeeding or continuing
corporation or other organization and shall be paid in accordance with the
Plan.
L. Adjustments
Any other provision of the Plan to the contrary notwithstanding, the Company in
its sole discretion and in light of the Objectives of the Plan may take such
action as it shall deem reasonable and appropriate in the determination of
annual Objectives, the Company's and/or an Organizational Unit's performance
with respect thereto, and/or the resulting Actual Bonus to adjust for the
distortive effects, if any, or any singular event(s) and/or extraordinary
item(s) arising in the conduct of the business of the Company or a Subsidiary.
Such event(s) and/or item(s) may result from, but are not necessarily limited
to, a change in accounting method, the sale of assets and/or business
operations, a restructuring or reorganization of the Company or a Subsidiary or
other unexpected event which materially alters the financial performance of the
Company and/or its Organizational Units.
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<PAGE> 15
M. Construction
In the construction of the Plan, the masculine shall include the feminine and
the singular the plural in all cases where such meanings would be appropriate.
N. Effect of Invalidity of Provision
If any provision of this Plan is held invalid or unenforceable, such invalidity
or unenforceability shall not affect any other provisions hereof, and this Plan
shall be construed and enforced as if such provision had not been included.
O. Inurement
This Plan shall be binding upon and inure to the benefit of the Company and its
successors and assigns and the Participants, and their administrators and
beneficiaries.
P. Personal Liability
Members of the Board of Directors or the Compensation Committee, nor any
officer or Employee of the Company or a Subsidiary acting on behalf of the
Company or Subsidiary shall be personally liable for any action, determination,
or interpretation taken or made with respect to the Plan, and all members of
the Board or the Compensation Committee and each and any officer or employee of
the Company or a Subsidiary acting on their behalf shall be fully indemnified
and protected by the Company in respect of any such action, determination or
interpretation.
Q. Corporate Rights
The existence of the Management Bonus Plan shall not affect the right or power
of the Company to make adjustments, recapitalizations, reorganizations, or
other changes to the Company's capital structure or its business; issue bonds,
debentures, common, preferred or prior preference stocks; dissolve or liquidate
the Company, or sell or transfer any part of its assets or business; or any
other corporate act, whether of a similar character or otherwise.
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<PAGE> 16
R. Controlling Law
The validity, interpretation, and administration of the Plan and of any rules,
regulations, determinations, or decisions made thereunder, and the rights of
any and all persons having or claiming to have any interest therein or
thereunder, shall be determined exclusively in accordance with the laws of the
State of Georgia. Without limiting the generality of the foregoing, the period
within which any action in connection with the Plan must be commenced shall be
governed by the laws of the State of Georgia.
S. Execution
IN WITNESS WHEREOF, the company has caused this Plan to be signed by its duly
authorized officers this 31st day of August, 1993.
INTERMET CORPORATION
Attest: /s/ John D. Ernst By: /s/ James W. Rydel
-------------------------- ---------------------------------
Title: V. P. Human Resources
------------------------------
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<PAGE> 17
XI. EXHIBIT 1 - PARTICIPANTS AND TARGET BONUSES
<PAGE> 1
EXHIBIT 10.16 (a)
INTERMET CORPORATION
SALARIED EMPLOYEES
SEVERANCE PLAN
Effective As of October 1, 1993
<PAGE> 2
<TABLE>
<CAPTION>
INTERMET CORPORATION SALARIED EMPLOYEES SEVERANCE PLAN
Table of Contents
Page No.
-------
<S> <C> <C>
ARTICLE I Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-1
ARTICLE II Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-1
2.1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-1
ARTICLE III Eligibility for Severance Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-1
3.1 Eligibility Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-1
ARTICLE IV Amount and Form of Severance Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-1
4.1 Base Severance Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-1
4.2 Enhanced Severance Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-1
4.3 Payment of Severance Pay . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-2
4.4 Other Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-3
ARTICLE V Plan Financing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-1
ARTICLE VI Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-1
6.1 Allocation of Responsibility Among Fiduciaries for Plan Administration . . . . . . . . . . . . VI-1
6.2 Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-1
6.3 Claims Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-1
6.4 Other Administrative Powers and Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-3
6.5 Authorization of Benefit Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-4
6.6 Facility of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-4
ARTICLE VII Amendment of the Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-1
ARTICLE VIII Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VIII-1
ARTICLE IX Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX-1
9.1 Plan as Sole Source of Separation Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . IX-1
9.2 Nonguarantee of Employment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX-1
9.3 Spendthrift Clause . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX-1
9.4 Successor to the Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX-2
9.5 Delegation of Authority by the Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . IX-2
9.6 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX-2
</TABLE>
-i-
<PAGE> 3
<TABLE>
<CAPTION>
Table of Contents (Continued)
<S> <C> <C>
ARTICLE X Applicable Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . X-1
ARTICLE XI Signature . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XI-1
APPENDIX A ADOPTING EMPLOYERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1
APPENDIX B SEVERANCE AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1
</TABLE>
-ii-
<PAGE> 4
ARTICLE I
Foreword
The Intermet Corporation Salaried Employees Severance Plan
provides eligible full-time salaried employees of Intermet Corporation and
other affiliated employers (see Appendix A attached hereto and made a part
hereof) severance benefits in the form of severance pay, and continuation of
medical and life insurance coverage. To receive severance benefits, an
eligible employee must execute a written severance agreement. Except for the
1993 Special Voluntary Severance Plan for Salaried Employees of Intermet
Foundries, Inc. and its Subsidiaries (the "1993 Voluntary Plan"), the only
severance benefits provided by Intermet Corporation and its affiliates to
salaried employees are pursuant to the terms and conditions of this Plan. This
Plan is effective as of October 1, 1993.
This Plan is the first and exclusive plan of benefits by
Intermet Corporation and the affiliated employers for the provision of
severance pay and any post-termination benefits. Except for the 1993 Voluntary
Plan, to the extent that any other written or unwritten plan, fund, program or
arrangement to provide such benefits for any employees of Intermet Corporation
or the affiliated employers is deemed to exist, or to have existed, under ERISA
or otherwise, such other written or unwritten plan, fund, program, or
arrangement is hereby terminated and eliminated as of October 1, 1993.
I-1
<PAGE> 5
ARTICLE II
Definitions
2.1 Definitions: This section provides definitions for
certain words and phrases listed below. These definitions can be found on the
pages indicated.
Page
----
(a) Authorized Leave of Absence II-1
(b) Base Pay II-2
(c) Base Severance Benefits II-2
(d) COBRA Extended Coverage II-2
(e) Code II-2
(f) Corporation II-2
(g) Effective Date II-2
(h) Employee II-2
(i) Employer II-3
(j) Enhanced Severance Benefits II-4
(k) ERISA II-4
(l) ESOP II-4
(m) Fiduciaries II-4
(n) Medical, Dental and Life Insurance
Coverage Continuation II-4
(o) Participant II-4
(p) Plan II-5
(q) Plan Administrator II-5
(r) Plan Year II-5
(s) Pre-Tax Contributions II-5
(t) Retiree Medical and Life Insurance
Coverage II-5
(u) Savings and Investment Plan II-5
(v) Severance Agreement II-5
(w) Severance Benefits II-6
(x) Severance Date II-6
(y) Severance Pay II-6
(z) Years of Service II-6
Where the following words and phrases in boldface and underlined appear in this
Plan with initial capitals they shall have the meaning set forth below, unless
a different meaning is plainly required by the context.
(a) AUTHORIZED LEAVE OF ABSENCE - Any absence
authorized by an Employer under the Employer's standard personnel
practices, whether paid or unpaid, provided that
II-1
<PAGE> 6
the Participant returns within the period specified in the Authorized
Leave of Absence.
(b) BASE PAY - A Participant's
regular straight time pay for the last regular pay period (or regularly
scheduled workweek) immediately preceding his Severance Date,
including Pre-Tax Contributions. Base Pay shall exclude any overtime
pay, bonuses, commissions, fees and incentive allowances. In
addition, except as provided with respect to the Pre-Tax
Contributions, Base Pay shall also exclude any benefits, and the value
of any benefits, provided by the Employer.
(c) BASE SEVERANCE BENEFITS - The Severance
Benefits described in Section 4.1 that a Participant will receive who
does not enter into a Severance Agreement.
(d) COBRA EXTENDED COVERAGE - The continuation of
medical and other health care coverages (or less than all of these) at
the Employee's expense pursuant to Code section 4980B and ERISA
sections 601 through 608.
(e) CODE - The Internal Revenue Code of 1986, as
amended from time to time.
(f) CORPORATION - Intermet Corporation,
a corporation organized and existing under the laws of the
state of Georgia, or its successor or successors.
(g) EFFECTIVE DATE - The date upon which this
Plan is effective, October 1, 1993.
(h) EMPLOYEE - Any person who is a full-time
salaried employee of an Employer and who is receiving
II-2
<PAGE> 7
remuneration for personal services rendered to an Employer (or who is
on an Authorized Leave of Absence). A person shall be considered a
full-time employee if he is regularly scheduled to work at least 30
hours per week. The following individuals or classes of individuals
shall not qualify as Employees under this Plan:
(1) Any individual whose terms and
conditions of employment are determined by collective
bargaining with a union representing such persons and with
respect to whom inclusion in this Plan has not been
specifically provided for in such collective bargaining
agreement;
(2) Any individual who is classified by
the Employer as hourly or administrative hourly, temporary,
part-time, as an intern or who is working for the Employer
through a temporary service or on a contract basis; and
(3) Any individual who is not a United
States citizen and who does not reside in the United States.
(i) EMPLOYER - The Corporation and the affiliated
companies (listed in Exhibit A attached hereto and made a part hereof)
that are authorized by the Corporation to participate herein and which
are adopting the Plan for their Employees.
II-3
<PAGE> 8
(j) ENHANCED SEVERANCE BENEFITS - The Severance
Benefits described in Section 4.2 that a Participant will receive who
does enter into a Severance Agreement.
(k) ERISA - Public Law No. 93-406, the Employee
Retirement Income Security Act of 1974, as amended from time to time.
(l) ESOP - The Intermet Corporation Employee
Stock Ownership Plan, as it may be amended from time to time.
(m) FIDUCIARIES - The named fiduciaries, as
defined in ERISA, who shall be the Corporation and the Plan
Administrator, and other parties designated as Fiduciaries by such
named fiduciaries in accordance with the powers provided herein, but
only with respect to the specific responsibilities of each in
connection with the Plan. A copy of a sample Severance Agreement
intended for use in connection with this Plan is attached hereto as
Exhibit B.
(n) MEDICAL, DENTAL AND LIFE INSURANCE COVERAGE
CONTINUATION - The medical, dental and basic life insurance coverage
provided to the Employee as of his Severance Date under the Intermet
Corporation Salaried Employees Comprehensive Medical Plan and life
insurance plan.
(o) PARTICIPANT - An Employee who has satisfied
the eligibility requirements of Section 3.1, and who has become
entitled to receive Severance Benefits under this Plan.
II-4
<PAGE> 9
(p) PLAN - The Intermet Corporation Salaried
Employees Severance Plan, the Plan set forth herein, as it may be
amended from time to time.
(q) PLAN ADMINISTRATOR - The Corporation, or an
entity or person appointed by the Corporation, which shall have
authority to administer the Plan as provided in Article VI.
(r) PLAN YEAR - The first Plan Year shall be the
short Plan Year beginning on October 1, 1993 and ending on December
31, 1993. Thereafter, the Plan Year shall be each January 1 through
December 31.
(s) PRE-TAX CONTRIBUTIONS - Pre-Tax contributions
that the Employee elects to make to (i) the Intermet Savings and
Investment Plan; (ii) the Intermet Salaried Employees Dependent
Coverage; and (iii) any similar plans sponsored by the Corporation for
its salaried employees which provide for pre-tax employee
contributions.
(t) RETIREE MEDICAL AND LIFE INSURANCE COVERAGE -
The retiree medical and life insurance coverage provided to the
Employee as a retiree under the Intermet Corporation Salaried
Employees Comprehensive Medical Plan, as it may be amended from time
to time.
(u) SAVINGS AND INVESTMENT PLAN - The Intermet
Corporation Savings and Investment Plan, as it may be amended from
time to time.
(v) SEVERANCE AGREEMENT - The written agreement
between the Employee and an Employer (on a form provided by
II-5
<PAGE> 10
an Employer) which is a condition precedent to the Employee's
receiving the Severance Benefits under the Plan.
(w) SEVERANCE BENEFITS - The Base Severance
Benefits and Enhanced Severance Benefits described in Article IV of
the Plan which are payable to or on behalf of a Participant.
(x) SEVERANCE DATE - The date designated by the
Employer that will be the Participant's last day of active employment.
(y) SEVERANCE PAY - The severance pay payable to
a Participant in accordance with the provisions of Section 4.1.
(z) YEARS OF SERVICE - The number of the
Participant's complete Years of Service determined in accordance with
the provisions for vesting service under the Savings and Investment
Plan as in effect from time to time.
II-6
<PAGE> 11
ARTICLE III
Eligibility for Severance Benefits
An Employee shall only be eligible to receive Severance
Benefits under this Plan if he satisfies the requirements of Section 3.1(a)(1)
below and executes a Severance Agreement as described in Section 3.1(b) below.
The amount and form of any Severance Benefits shall be determined in accordance
with Article IV.
3.1 Eligibility Requirements
(a) Termination of Employment - (1) An Employee
who has completed at least one Year of Service as an Employee whose
employment with the Employer is permanently terminated shall be
eligible for Severance Benefits hereunder if his termination is due to
one of the following events:
(A) a reduction in the Employer's work
force;
(B) an elimination of his job or
position with the Employer; or
(C) certain other circumstances
specified by the Corporation where an Employee loses his
position through no fault of his own and where his
termination is not attributable to any willful cause.
The loss of a particular job will not be considered a termination on
account of a reduction in the Employer's work force or an elimination
of a particular job or position if the Employee refuses to accept
another similar position that
III-1
<PAGE> 12
is offered by the Employer, unless the available position requires the
Employee to relocate to a work location more than 150 miles from his
current work location. Further, any Employee who is terminated by the
Employer in connection with the sale of the assets or business of the
Corporation, or any division, subsidiary, plant, business unit or
other portion of the Corporation, shall not be eligible to receive
benefits under this Plan.
(2) Employees will not be eligible for Severance
Benefits pay if they:
(A) leave employment with the Employer
voluntarily;
(B) are terminated for cause or
misconduct;
(C) are on a temporary layoff or
Authorized Leave of Absence; or
(D) retire from the Employer under
conditions not involving elimination or termination of
their job or position.
(3) The Plan Administrator shall have the
discretionary right and final authority to make any necessary
determinations based on the factors discussed in (a)(1) and (2) above
and to determine whether an Employee is eligible to receive Severance
Benefits.
(b) Severance Agreement - If an Employee
satisfies the eligibility requirements of Section 3.1(a)(1) above, he
shall be entitled to Severance Benefits, as follows:
III-2
<PAGE> 13
(1) A Participant who does not execute a Severance
Agreement shall be entitled to Base Severance Benefits commencing
after his Severance Date.
(2) A Participant who has executed a Severance
Agreement that becomes irrevocable shall be entitled to Enhanced
Severance Benefits commencing after his Severance Date.
III-3
<PAGE> 14
ARTICLE IV
Amount and Form of Severance Benefits
When an Employee satisfies the eligibility requirements of
Article III and becomes a Participant in the Plan, he shall be entitled to the
Severance Benefits set forth in Sections 4.1 and 4.2 below.
4.1 Base Severance Benefits - Subject to Section 4.3
below, a Participant entitled to Base Severance Benefits shall receive the
following:
(a) Severance Pay equal to one week of Base Pay for each
Year of Service with a maximum of four (4) weeks of Base Pay.
(b) COBRA Extended Coverage at the Participant's cost,
for the period and subject to the conditions mandated by ERISA and the Code.
4.2 Enhanced Severance Benefits - Subject to Section 4.3
below, a Participant entitled to Enhanced Severance Benefits shall receive the
following:
(a) Severance Pay equal to one week of Base Pay for each
Year of Service, with a minimum of eight (8) weeks of Base Pay and a maximum of
twenty-six (26) weeks of Base Pay.
(b) Medical, Dental and Life Insurance Coverage
Continuation on the same basis as such coverages are provided at that time to
active Employees (including any costs for such coverages required to be paid by
Employees at the time) for the period commencing on the Participant's Severance
Date and ending on the last day the Participant is entitled to Severance Pay.
If
IV-1
<PAGE> 15
the Participant is eligible for Retiree Medical and Life Insurance Coverage,
then such coverage shall not commence until the end of the period the
Participant is entitled to Severance Pay, unless the Participant elects to
commence such coverage at an earlier time. The period a Participant is
receiving Medical, Dental and Life Insurance Continuation Coverage under
subsection (b) shall be deducted from, and reduce the total time period that
COBRA Extended Coverage will be available to the Participant and his
beneficiaries.
4.3 Payment of Severance Pay - Severance Pay shall be
payable in the same manner as the Participant was receiving his regular salary
and at the same rate per pay period as Base Pay, less deductions for applicable
local, state and federal taxes, any continuing benefits costs and other legally
required deductions (including amounts owed to the Employer). Severance Pay is
payable to Participants in addition to pay for any unused vacation for the year
in which the Participant's Severance Date occurs. The payment of any Severance
Pay under this Article IV shall cease on the date of death of the Participant.
The Plan Administrator may elect, in its discretion, to make payments of
Severance Pay in a lump sum. The amount of Severance Pay will be offset by (i)
the amount (if any) a Participant receives pursuant to the Worker Adjustment
and Retraining Notification Act (WARN), and (ii) any unemployment compensation
or worker's compensation weekly income benefits the Participant receives for
the period he is receiving Severance Pay. Severance Pay will not be counted
for purposes of the Participant's eligibility for, or the
IV-2
<PAGE> 16
Employer's contributions to, the Savings and Investment Plan and the ESOP.
4.4 Other Benefits - With the exception of the benefits
provided under Sections 4.1 and 4.2 above, the Employer-sponsored benefits
provided to a Participant shall cease as of the Participant's Severance Date.
For Participants entitled to Base Severance Benefits, this includes the Savings
and Investment Plan, the ESOP, dental care, regular, dependent and optional
life, short-term and long-term disability, accidental death and dismemberment
(AD&D), voluntary accident and vacation; for Participants entitled to Enhanced
Severance Benefits, this includes the Savings and Investment Plan, the ESOP,
dependent and optional life, short-term and long-term disability, AD&D,
voluntary accident and vacation.
IV-3
<PAGE> 17
ARTICLE V
Plan Financing
No assets of the Employer shall be specifically set aside for
the payment of benefits under this Plan. Any benefits payable under this Plan
shall be paid solely out of the general assets of the Employer or through the
Intermet Corporation Salaried Employees Comprehensive Medical Plan, and the
obligation of any Employer is simply an obligation to make payments according
to the terms and conditions of this Plan. A Participant's right to any
payments hereunder shall be the same as that of any unsecured general creditor
of the Employer.
V-1
<PAGE> 18
ARTICLE VI
Administration
6.1 Allocation of Responsibility Among Fiduciaries for
Plan Administration - The Fiduciaries shall have only those powers, duties,
responsibilities, and obligations as are specifically given or delegated to
them under this Plan. The Employer and the Corporation shall have the sole
responsibility for paying the benefits under this Plan described in Article IV,
and the Corporation shall have the sole authority to appoint and remove the
Plan Administrator, and to amend or terminate this Plan in whole or in part.
The Plan Administrator shall have the sole responsibility for the
administration of the Plan, which responsibility is specifically described
herein.
6.2 Administration - The Plan shall be administered by
the Plan Administrator which may appoint or employ individuals to assist in the
administration of the Plan and which may appoint or employ any other agents it
deems advisable, including legal counsel and auditors, to serve at the Plan
Administrator's direction. All usual and reasonable expenses of the Plan
Administrator in administering the Plan shall be paid in whole or in part by
the Employer.
6.3 Claims Procedure - The Plan Administrator shall have
the exclusive discretionary authority to construe and to interpret the Plan, to
decide all questions of eligibility for benefits and to determine the amount of
such benefits, and its decisions on such matters are final and conclusive. Any
exercise of this discretionary authority shall be reviewed by a court
VI-1
<PAGE> 19
under the arbitrary and capricious standard (i.e., the abuse of discretion
standard). If, pursuant to this discretionary authority, an assertion of any
right to a benefit by an Employee is wholly or partially denied, the Plan
Administrator, or a party designated by the Plan Administrator, will provide
such claimant, within the 90-day period following the receipt of the claim by
the Plan Administrator, a comprehensible written notice setting forth:
(a) The specific reason or reasons for such
denial;
(b) Specific reference to pertinent Plan
provisions on which the denial is based;
(c) A description of any additional material or
information necessary for the claimant to submit to perfect the claim
and an explanation of why such material or information is necessary;
and
(d) A description of the Plan's claim review
procedure. The claim review procedure is available upon
written request by the claimant to the Plan Administrator, or the
designated party, within 60 days after receipt by the claimant of
written notice of the denial of the claim, and includes the right to
examine pertinent documents and submit issues and comments in writing
to the Plan Administrator, or the designated party. The decision on
review shall be made within 60 days after receipt of the request for
review, unless circumstances warrant an extension of time not to
exceed an additional 60 days, and shall be in writing and
VI-2
<PAGE> 20
drafted in a manner calculated to be understood by the claimant, and
include specific reasons for the decision with references to the
specific Plan provisions on which the decision is based.
If within a reasonable period of time after the Plan receives the claim
asserted by the Employee, the Plan Administrator, or the designated party,
fails to provide a comprehensible written notice stating that the claim is
wholly or partially denied and setting forth the information described in (a)
through (d) above, the claim shall be deemed denied. Once the claim is deemed
denied, the Employee shall be entitled to the claim review procedure described
in subsection (d) above. Such review procedure shall be available upon written
request by the claimant to the Plan Administrator, or the designated party,
within 60 days after the claim is deemed denied.
6.4 Other Administrative Powers and Duties - The Plan
Administrator shall have such powers and duties as may be necessary to
discharge its functions hereunder, including but not limited to:
(a) To exercise its discretionary authority to
construe and interpret the Plan, decide all questions of eligibility
and determine the amount, manner and time of payment of any benefits
hereunder;
(b) To prescribe procedures to be followed by
Employees requesting benefits;
VI-3
<PAGE> 21
(c) To prepare and distribute, in such manner as
the Plan Administrator determines to be appropriate, information
explaining the Plan;
(d) To receive from Employees and agents and from
the Employer such information as shall be necessary for the proper
administration of the Plan;
(e) To appoint or employ individuals or other
parties to assist in the administration of the Plan and any other
agents it deems advisable, including accountants and legal counsel;
and
(f) To delegate to other persons or entities, or
to designate or employ persons to carry out any of the Plan
Administrator's fiduciary duties or responsibilities or other
functions under the Plan.
6.5 Authorization of Benefit Payments - The Plan
Administrator shall issue directions to the Employers concerning all benefits
which are to be paid pursuant to the provisions of the Plan, and shall warrant
that all such directions are in accordance with this Plan.
6.6 Facility of Payment - Whenever, in the Plan
Administrator's opinion, a Participant entitled to receive any payment of a
benefit or installment thereof hereunder is under a legal disability or is
incapacitated in any way so as to be unable to manage his financial affairs,
the Plan Administrator may direct the Participant's Employer to make payments
to such person or to the legal representative of such person for his benefit,
or the Plan Administrator may direct the Participant's
VI-4
<PAGE> 22
Employer to apply the payment for the benefit of such person in such manner as
the Plan Administrator considers advisable. Any payment of a benefit or
installment thereof in accordance with the provisions of this section shall be
a complete discharge of any liability for the making of such payment under the
provisions of the Plan.
VI-5
<PAGE> 23
ARTICLE VII
Amendment of the Plan
The Corporation shall have the absolute right at any time by
instrument in writing to modify, alter or amend the Plan in whole or in part,
retroactively or otherwise, including, without limitation, the benefits
provided under the Plan, provided, however, that no such amendment shall
diminish or eliminate any payment of Severance Pay that a Participant had
qualified for and begun to receive prior to the date of such amendment. The
Corporation's right to amend the Plan shall not be affected or limited in any
way by an Employee's termination of employment. Prior practices by any
Employer or the Corporation or any entity related to the Employer or the
Corporation shall not diminish in any way the rights granted the Corporation
under this Article. Also, it is expressly permissible for an amendment to
affect less than all of the Employees covered by the Plan.
VII-1
<PAGE> 24
ARTICLE VIII
Termination
The Corporation and the Employers assume no obligation to
continue the Plan. The Corporation hereby reserves the right to terminate, or
to partially terminate, the Plan at any time for any reason. If the
Corporation decides to terminate or partially terminate the Plan, the Plan
Administrator shall be notified of such termination in writing and shall
proceed at the direction of the Corporation to take such steps as are necessary
to discontinue the operation of the Plan in an appropriate and timely manner.
VIII-1
<PAGE> 25
ARTICLE IX
Miscellaneous
9.1 Plan as Sole Source of Separation Benefits - Except
for the 1993 Voluntary Plan, the only severance, or other similar, benefits to
which an Employee is entitled who terminates employment with the Employer
during the time this Plan is in effect are provided for pursuant to the terms
and conditions of this Plan. No other severance payments, severance benefits
or any similar benefits shall be payable from any other source, regardless of
whether the Employee is eligible for or entitled to benefits under this Plan,
nor shall any prior practices of the Employer or the Corporation or any entity
related to an Employer or the Corporation, to the extent such practices may
have existed, give rise to any rights to any benefits upon severance from
employment.
9.2 Nonguarantee of Employment - Nothing contained in
this Plan shall be construed as a contract of employment between the Employer
and any Employee, or as a right of any Employee to be continued in the
employment of the Employer, or as a limitation of the right of the Employer to
discharge any of its Employees, with or without cause.
9.3 Spendthrift Clause - Except to the extent mandated by
law, benefits payable under this Plan shall not be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
charge, garnishment, execution, or levy of any kind, either voluntary or
involuntary, and any attempt to anticipate, alienate, sell, transfer, assign,
IX-1
<PAGE> 26
pledge, encumber, charge or otherwise dispose of any right to benefits payable
hereunder, shall be void and of no force and effect whatsoever; provided,
however, that the benefits hereunder may be assigned or transferred to pay any
bona fide debt of the Participant to an Employer. The Plan shall not in any
manner be liable for, or subject to, the debts, contracts, liabilities,
engagements or torts of any person entitled to benefits hereunder.
9.4 Successor to the Corporation - In the event of the
dissolution, merger, consolidation or reorganization of the Corporation,
provision may be made by which the Plan will be continued by the successor,
and, in that event, such successor shall be substituted for the Employer under
the Plan.
9.5 Delegation of Authority by the Corporation - Any
action by the Corporation under this Plan may be made by any person or persons
duly authorized by the Corporation to take such action.
9.6 Headings - The headings of sections and subsections
are for ease of reference only and shall not be construed to limit or modify
the detailed provisions thereof.
IX-2
<PAGE> 27
ARTICLE X
Applicable Law
The provisions of the Plan shall be construed and administered
according to, and its validity and enforceability shall be determined under
ERISA. In the event ERISA does not pre-empt state law in a particular
circumstance, the laws of the State of Georgia shall govern.
If any provision of this Plan is, or is hereafter declared to
be void, voidable, invalid or otherwise unlawful, the remainder of the Plan
shall not be affected thereby.
X-1
<PAGE> 28
ARTICLE XI
Signature
The above Plan is hereby adopted and approved, to be effective as of
October 1, 1993.
INTERMET CORPORATION
By: /s/ James W. Rydel
----------------------------------
V.P. Human Resources
XI-1
<PAGE> 29
APPENDIX A
ADOPTING EMPLOYERS
Intermet Foundries, Inc. and its subsidiaries
Intermet Technologies, Inc. and its subsidiaries
Intermet Machining, Inc. and its subsidiaries
Intermet Aluminum, Inc. and its subsidiaries
A-1
<PAGE> 30
APPENDIX B
SEVERANCE AGREEMENT
I, ______________________________, the undersigned, hereby acknowledge
receipt of a copy of the Summary Plan Description ("SPD") for the Intermet
Corporation Salaried Employees Severance Plan (the "Plan"). I also acknowledge
that I have been given forty-five (45) days to review the SPD, to review this
Agreement, and to decide whether or not to accept the terms and conditions
required for my receipt of the Enhanced Severance Benefits (hereinafter
"Severance Benefits") offered as part of the Plan. I certify that I have had
the opportunity to obtain all advice and information I deem necessary with
respect to the matters covered by this Agreement and the SPD, including the
opportunity to consult with legal counsel or anyone else of my choosing. By my
execution of this Severance Agreement, I agree to accept the Severance Benefits
under the Plan. I understand and agree that I must remain employed until my
Severance Date, as defined in the Plan, in order to be eligible for benefits
under the Plan.
I agree not to take any action which disparages or criticizes
Intermet Corporation or its affiliated corporations, hereinafter collectively
referred to as "the Company," or its operations, including actions which would
result in the filing of any claims, lawsuits or charges against the Company as
a result of anything which has occurred up to and including the present date.
In addition, and in further consideration of my receiving the
Severance Benefits, including additional Severance Pay equal to ____________
_________________________________________________ payable $________________,
less applicable deductions, twice per month; I hereby agree to release and
discharge the Company, its officers, directors and employees from any and all
claims, losses or expenses I now have or have had, or may later claim to have
had against them arising out of my employment with the Company or termination
therefrom. I understand and agree that I will not be entitled hereafter to
pursue any claims arising out of any alleged violation of my rights while
employed by the Company, including, but not limited to claims for back pay,
losses or other damages to me or my property resulting from any alleged
violation of state or federal law, such as (but not limited to) claims arising
under Title VII of the Civil Rights Act of 1964, 42 U.S.C. Section 2000e,
et.seq. (prohibiting discrimination on account of race, sex, national origin or
religion); claims arising under the Age Discrimination in Employment Act of
1967, 29 U.S.C. Sections 621, et. seq. (prohibiting discrimination on account
of age); claims
B-1
<PAGE> 31
under the Employee Retirement Income Security Act of 1974, as amended
(ERISA), 29 U.S.C. 1001, et. seq.; claims under the Americans with Disabilities
Act of 1990 (ADA) 42 U.S.C. Sections 12101-12213 (Supp. II 1990); and any
similar federal or state law claim relating to my employment.
By signing this Agreement and accepting the Severance Benefits
provided by the Plan, I agree that I will not hereafter pursue any individual
claim against the Company, its officers, directors and employees, in any state
or federal court, or before any state or federal agency, including, for
example, the Equal Employment Opportunity Commission or the Department of
Labor, for or on account of anything which has occurred up to the present time
as a result of amy employment or the termination of my employment with the
Company. I also understand and agree that the Company will have no obligation
to re-employ me.
I understand that, for a period up to and including seven (7)
days after the date I sign this Agreement, I may revoke it entirely. No rights
or obligations contained in this Agreement shall become enforceable before the
end of this seven-day revocation period. If I decide to revoke the Agreement,
I will deliver to the Company a signed Notice of Revocation on or before the
end of this seven-day period. Upon delivery of a timely Notice of Revocation,
this Agreement shall be cancelled and void and neither party to this Agreement
shall have any rights or obligations arising under it.
I FURTHER ACKNOWLEDGE AND AGREE THAT NO OTHER PROMISE OR
AGREEMENT OF ANY KIND HAS BEEN MADE TO ME BY THE COMPANY TO CAUSE ME TO EXECUTE
THIS AGREEMENT AND THAT THE ONLY CONSIDERATION FOR MY EXECUTION OF THIS
AGREEMENT IS SET FORTH COMPLETELY AND FULLY IN THIS DOCUMENT AND IN THE
INTERMET CORPORATION SALARIED EMPLOYEES SEVERANCE PLAN. I HAVE CAREFULLY READ
THIS AGREEMENT, I UNDERSTAND ITS MEANING AND INTENT, AND I VOLUNTARILY AGREE
TO ABIDE BY ITS TERMS. I ACKNOWLEDGE RECEIVING A COPY OF THIS AGREEMENT AND
SUMMARY PLAN DESCRIPTION FOR MY PERSONAL RECORDS.
FOR THE COMPANY: EMPLOYEE'S SIGNATURE:
- ------------------------- ---------------------------------
Date: Date:
-------------------- ----------------------------
B-2
<PAGE> 1
EXHIBIT 10.16(b)
AMENDMENT NO. 1 TO THE
INTERMET CORPORATION
SALARIED EMPLOYEES SEVERANCE PLAN
(As Effective as of October 1, 1993)
THIS AMENDMENT made and entered into this 20th day of December, 1993,
by INTERMET CORPORATION (the "Company");
W I T N E S S E T H:
WHEREAS, the Company previously adopted the Intermet Corporation
Salaried Employees Severance Plan (the "Plan"); and
WHEREAS, pursuant to Article VII of the Plan, the Company has the
power to modify, alter or amend the Plan at any time; and
WHEREAS, the Company now desires to amend and to clarify the Plan as
provided in this Amendment No. 1;
NOW THEREFORE, in consideration of the premises and covenants herein
contained and contained in the Plan, the Plan is hereby amended as follows:
1.
The definition of "Retiree Medical and Life Insurance Coverage" in
Section 2.1(t) is hereby deleted entirely and replaced with the following
revised definition:
"The retiree medical and life insurance coverage provided to
the Employee as a retiree under the Intermet Corporation Salaried
Employees Comprehensive Medical Plan and life insurance plan, as they
may be amended from time to time."
<PAGE> 2
2.
The definition of "Severance Agreement" in Section 2.1(v) is hereby
deleted entirely and replaced with the following revised definition:
"The written agreement between the Employee and an Employer
(on a form provided by the Employer) which is a condition precedent to
the Employee's receiving Enhanced Severance Benefits under the Plan.
A copy of a sample Severance Agreement intended for use in connection
with this Plan is attached hereto as Appendix B."
3.
Section 2.1(z) of the Plan is amended by adding the following phrase
at the beginning of the current provision:
"For purposes of determining the amount of a Participant's
Severance Pay under the Plan,"
4.
Section 3.1(a) of the Plan is amended by deleting the current
provision entirely and replacing it with the following new provision:
"3.1 Eligibility Requirements
(a) Termination of Employment - (1) An Employee who has
completed at least one year of service as an Employee, as defined in
Section 3.1(a)(3) below, whose employment with the Employer is
permanently terminated shall be eligible for Severance Benefits
hereunder if he is notified by the Employer in writing (a "Termination
Notice") that his termination is due to one of the following events:
(A) a reduction in the Employer's work force;
(B) an elimination of his job or position with the
Employer; or
-2-
<PAGE> 3
(C) certain other circumstances specified by the
Corporation where an Employee loses his position through no fault of
his own and where his termination is not attributable to any willful
cause.
The loss of a particular job will not be considered a termination on
account of a reduction in the Employer's work force or an elimination
of a particular job or position if the Employee refuses to accept
another similar position that is offered by the Employer, unless the
available position requires the Employee to relocate to a work
location more than 50 miles from his current work location. Further,
any Employee who is terminated by the Employer in connection with the
sale of the assets or business of the Corporation, or any division,
subsidiary, plant, business unit or other portion of the Corporation,
shall not be eligible to receive benefits under this Plan.
(2) Employees will not be eligible for Severance Benefits
if they:
(A) leave employment with the Employer voluntarily;
(B) are terminated for cause or misconduct;
(C) are on a temporary layoff or Authorized Leave of
Absence; or
(D) retire from the Employer under conditions not
involving elimination or termination of their job or position.
(3) A year of service for purposes of determining an
Employee's eligibility to receive Severance Benefits under Section
3.1(a)(1) of the Plan, is a complete, continuous twelve (12) month
period of employment with the Employer commencing with an Employee's
most recent date of hire. For this purpose, an Employee shall not
receive credit for any periods of employment with the Employer that
precede the Employee's current, continuous period of employment with
the Employer.
(4) The Plan Administrator shall have the discretionary
right and final authority to make any necessary determinations based
on the factors discussed in (a)(1), (2) and (3) above and to determine
whether an Employee is eligible to receive Severance Benefits."
-3-
<PAGE> 4
5.
Section 4.2(a) of the Plan is amended by deleting the current
provision and replacing it with the following revised provision:
"Severance Pay equal to one week of Base Pay for each Year of
Service, with a minimum of eight (8) weeks of Base Pay."
6.
Section 4.3 of the Plan is amended by denoting the current provision
in its entirety as subsection (a) and adding the following new subsection (b):
"(b) In the event that a Participant who is receiving Enhanced
Severance Benefits violates any of the provisions or fails to comply
with any of the obligations contained in the Severance Agreement, the
Employer reserves the right to terminate the Participant's continued
eligibility for Enhanced Severance Benefits and immediately recover
all benefits previously paid to the Employee in excess of Base
Severance Benefits payable to the Employee under the Plan."
7.
Appendix A to the Plan is revised by inserting in place of the current
Appendix, the revised Appendix A, as attached to this Amendment.
8.
Appendix B to the Plan is revised by inserting in place of the current
Appendix, the revised Appendix B, as attached to this Amendment.
-4-
<PAGE> 5
9.
The effective date of this Amendment shall be October 1, 1993.
10.
Except as herein provided, the provisions of the Plan shall remain in
full force and effect.
IN WITNESS WHEREOF, the Company has caused this Amendment No. 1 to be
executed as of the day and year first above written.
INTERMET CORPORATION
By: /s/ James W. Rydel
-------------------------------
Title: V.P. Human Resources
-------------------------------
-5-
<PAGE> 6
APPENDIX A
ADOPTING EMPLOYERS
Intermet Foundries, Inc. and its subsidiaries
InterMotive Technologies, Inc. and its subsidiaries
Intermet Machining, Inc. and its subsidiaries
Intermet Aluminum, Inc. and its subsidiaries
A-1
<PAGE> 7
APPENDIX B
SEVERANCE AGREEMENT
I, _________________________, the undersigned, hereby acknowledge
receipt of a copy of the Summary Plan Description ("SPD") for the Intermet
Corporation Salaried Employees Severance Plan (the "Plan"). I also acknowledge
that I have been given [twenty-one (21)] [forty-five (45)] days from receipt of
my Termination Notice to review the SPD, to review this Agreement, and to
decide whether or not to accept the terms and conditions required for my
receipt of the Enhanced Severance Benefits (hereinafter "Enhanced Severance
Benefits") offered as part of the Plan. I certify that I have had the
opportunity to obtain all advice and information I deem necessary with respect
to the opportunity to consult with legal counsel or anyone else of my choosing.
By my execution of this Severance Agreement, I agree to accept the Enhanced
Severance Benefits under the Plan. I understand and agree that I must remain
employed until my Severance Date, as defined in the Plan, in order to be
eligible for benefits under the Plan.
I also understand and agree that Intermet Corporation or its affiliated
corporations (the "Company") may terminate my continued eligibility for
Enhanced Severance Benefits and immediately recover all benefits previously
paid to me in excess of Base Severance Benefits, if I engage in any misconduct
or otherwise violate Company policy, including, but not limited to any action
that violates this Agreement or any related agreement or any action which
disparages or criticizes the Company or its management or practices or which
disrupts or impairs its normal operations or harms the reputation of the Company
with its customers, suppliers or the public; interferes with existing
contractual relationships with customers, suppliers or Company employees; or
misappropriates, misuses, or discloses any confidential information I learned
while actively employed by the Company; or any action which would result in the
filing of any claims, lawsuits or charges against the Company as a result of
anything that has occurred up to and including the present date.
I hereby further agree to return to the Company all Company property
in my possession on my Severance Date, including, keys, credit cards, lap-top
computer and car phone. I also agree to turn over to the Company on or before
my Severance Date, all papers, models, photographs, recordings, drawings, blue
prints, lists, specifications, formulas, processes, recipes, and designs
(including all copies of such materials) which relate to, or involve, the
business of the Company and which are in my possession or control.
<PAGE> 8
In addition, and in further consideration of my receiving the Enhanced
Severance Benefits, including Enhanced Severance Pay for _____ weeks, payable
$__________ twice per month (less applicable deductions), I hereby agree to
release and discharge the Company, its officers, directors and employees from
any and all claims, losses or expenses I now have or have had, or may later
claim to have had against them arising out of my employment with the Company or
termination therefrom. I understand and agree that I will not be entitled
hereafter to pursue any claims arising out of any alleged violation of my
rights while employed by the Company, including, but not limited to claims for
back pay, losses or other damages to me or my property resulting from any
alleged violation of state or federal law, such as (but not limited to) claims
arising under Title VII of the Civil Rights Act of 1964, 42 U.S.C. Section
2000e, et. seq. (prohibiting discrimination on account of race, sex, national
origin or religion); claims arising under the Age Discrimination in Employment
Act of 1967, 29 U.S.C. Sections 621, et. seq. (prohibiting discrimination on
account of age); claims under the Employee Retirement Income Security Act of
1974, as amended (ERISA), 29 U.S.C. Section 1001, et. seq.; claims under the
Americans with Disabilities Act of 1990 (ADA) 42 U.S.C. Sections 12101-12213
(Supp. II 1990); and any similar federal or state law claim relating to my
employment.
By signing this Agreement and accepting the Enhanced Severance
Benefits provided by the Plan, I agree that I will not hereafter pursue any
individual claim against the Company, its officers, directors and employees, in
any state or federal court, or before any state or federal agency, including,
for example, the Equal Employment Opportunity Commission or the Department of
Labor, for or on account of anything which has occurred up to the present time
as a result of my employment or the termination of my employment with the
Company. I also understand and agree that the Company will have no obligation
to re-employ me.
I understand that, for a period of up to and including seven (7) days
after the date I sign this Agreement, I may revoke it entirely. No rights or
obligations contained in this Agreement shall become enforceable before the end
of this seven-day revocation period. If I decide to revoke the Agreement, I
will deliver to the Company a signed Notice of Revocation on or before the end
of this seven-day period. Upon delivery of a timely Notice of Revocation, this
Agreement shall be cancelled and void and neither party to this Agreement shall
have any rights or obligations arising under it.
I FURTHER ACKNOWLEDGE AND AGREE THAT NO OTHER PROMISE OR AGREEMENT OF
ANY KIND HAS BEEN MADE TO ME BY THE COMPANY TO CAUSE ME TO EXECUTE THIS
AGREEMENT AND THAT THE ONLY CONSIDERATION FOR MY EXECUTION OF THIS AGREEMENT IS
SET FORTH
<PAGE> 9
COMPLETELY AND FULLY IN THIS DOCUMENT AND IN THE INTERMET CORPORATION SALARIED
EMPLOYEES SEVERANCE PLAN. I HAVE CAREFULLY READ THIS AGREEMENT, I UNDERSTAND
ITS MEANING AND INTENT, AND I VOLUNTARILY AGREE TO ABIDE BY ITS TERMS. I
ACKNOWLEDGE RECEIVING A COPY OF THIS AGREEMENT AND THE SUMMARY PLAN DESCRIPTION
FOR MY PERSONAL RECORDS.
FOR THE COMPANY: EMPLOYEE'S SIGNATURE:
- ------------------------------ ------------------------------
Date: Date:
------------------------ ------------------------
<PAGE> 1
EXHIBIT 10.17
1993 SPECIAL VOLUNTARY
SEVERANCE PLAN FOR
SALARIED EMPLOYEES OF
INTERMET FOUNDRIES, INC. AND
ITS SUBSIDIARIES
Effective As of October 1, 1993
<PAGE> 2
1993 SPECIAL VOLUNTARY SEVERANCE PLAN
FOR SALARIED EMPLOYEES OF
INTERMET FOUNDRIES, INC. AND ITS SUBSIDIARIES
<TABLE>
<CAPTION>
Table of Contents
Page No.
--------
<S> <C> <C>
ARTICLE I Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-1
ARTICLE II Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-1
2.1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-1
ARTICLE III Eligibility for Severance Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-1
3.1 Eligibility Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-1
ARTICLE IV Amount and Form of Severance Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-1
4.1 Severance Pay . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-1
4.2 Retiree Medical and Life Insurance Coverage . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-1
4.3 Savings and Investment Plan and ESOP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-2
4.4 Other Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-3
ARTICLE V Plan Financing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-1
ARTICLE VI Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-1
6.1 Allocation of Responsibility Among
Fiduciaries for Plan Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-1
6.2 Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-1
6.3 Claims Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-1
6.4 Other Administrative Powers and Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-3
6.5 Authorization of Benefit Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-4
6.6 Facility of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-4
ARTICLE VII Amendment of the Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-1
ARTICLE VIII Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VIII-1
ARTICLE IX Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX-1
9.1 Other Severance Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX-1
9.2 Nonguarantee of Employment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX-1
9.3 Spendthrift Clause . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX-1
9.4 Successor to the Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX-2
9.5 Delegation of Authority by the Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX-2
9.6 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX-2
ARTICLE X Applicable Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . X-1
ARTICLE XI Signature . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XI-1
APPENDIX A SEVERANCE AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1
APPENDIX B PLAN AMENDMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1
</TABLE>
<PAGE> 3
ARTICLE I
Foreword
The 1993 Special Voluntary Severance Plan for Salaried
Employees of Intermet Foundries, Inc. and Its Subsidiaries (the "Plan")
provides full-time salaried employees of Intermet Foundries, Inc. and its
subsidiaries ("IFI" or the "Employer"), who are eligible for normal retirement
or early retirement under the Intermet Corporation Savings and Investment Plan
("Savings and Investment Plan") special severance benefits. The decision to
elect to receive benefits under this Plan is completely voluntary. To receive
these special severance benefits, an eligible employee must voluntarily elect
between October 1, 1993 and November 19, 1993 to resign from employment.
Additionally, an employee must execute and not revoke a written Severance
Agreement. The Plan is effective October 1, 1993.
For eligible employees who elect to receive the benefits provided
under this Plan, the benefits provided herein are the only severance benefits
such employees will receive, and such employees shall not be eligible for any
other severance benefits provided by the Employer or Intermet Corporation.
I-1
<PAGE> 4
ARTICLE II
Definitions
2.1 Definitions: This section provides definitions for
certain words and phrases listed below. These definitions can be found on the
pages indicated.
Page
----
(a) Authorized Leave of Absence II-1
(b) Base Pay II-2
(c) Code II-2
(d) Corporation II-2
(e) Effective Date II-2
(f) Employee II-2
(g) Employer II-3
(h) ERISA II-3
(i) ESOP II-3
(j) Fiduciaries II-3
(k) Participant II-4
(l) Plan II-4
(m) Plan Administrator II-4
(n) Plan Year II-4
(o) Pre-Tax Contributions II-4
(p) Retiree Medical and Life Insurance
Coverage II-5
(q) Savings and Investment Plan II-5
(r) Severance Agreement II-5
(s) Severance Benefits II-5
(t) Severance Date II-6
(u) Severance Pay II-6
(v) Vacation Policy II-6
Where the following words and phrases in boldface and underlined appear in this
Plan with initial capitals they shall have the meaning set forth below, unless
a different meaning is plainly required by the context.
(a) AUTHORIZED LEAVE OF ABSENCE - Any absence
authorized the Employer under the Employer's standard personnel
practices, whether paid or unpaid, provided that the Participant
returns within the period specified in the Authorized Leave of
Absence.
II-1
<PAGE> 5
(b) BASE PAY - A Participant's regular straight
time pay for the last regular pay period immediately preceding his
Severance Date, including Pre-Tax Contributions. Base Pay shall
exclude any overtime pay, bonuses, commissions, fees and incentive
allowances. In addition, except as provided with respect to the
Pre-Tax Contributions, Base Pay shall also exclude any benefits, and
the value of any benefits, provided by the Employer.
(c) CODE - The Internal Revenue Code of 1986, as
amended from time to time.
(d) CORPORATION - Intermet Corporation, a
corporation organized and existing under the laws of the State of
Georgia, or its successor or successors.
(e) EFFECTIVE DATE - The date upon which this
Plan is effective, October 1, 1993.
(f) EMPLOYEE - Any person who is a full-time
salaried employee of the Employer and who is receiving remuneration
for personal services rendered to an Employer (or who is on an
Authorized Leave of Absence). A person shall be considered a
full-time employee if he is regularly scheduled to work at least 30
hours per week. The following individuals or classes of individuals
shall not qualify as Employees under this Plan:
(1) Any individual whose terms and
conditions of employment are determined by collective
bargaining with a union representing such persons and with
respect to whom inclusion in this Plan has not
II-2
<PAGE> 6
been specifically provided for in such collective bargaining
agreement;
(2) Any individual who is classified by
the Employer as hourly or administrative hourly, temporary,
part-time, as an intern, or who is working for the Employer
through a temporary service or on a contract basis;
(3) Any salaried employee of the
Corporation and its affiliates who is not employed by the
Employer; and
(4) Any individual who is not a United
States citizen and who does not reside in the United States.
(g) EMPLOYER - Intermet Foundries, Inc., a
corporation organized and existing under the laws of the State of
Georgia, and its subsidiaries, Lynchburg Foundry Company, Columbus
Foundries, Inc., Northern Castings Corporation, Ironton Iron, Inc.,
Pennsylvania Castings Corporation and New River Castings Company.
(h) ERISA - Public Law No. 93-406, the Employee
Retirement Income Security Act of 1974, as amended from time to time.
(i) ESOP - The Intermet Corporation Employee
Stock Ownership Plan, as it may be amended from time to time.
(j) FIDUCIARIES - The named fiduciaries, as
defined in ERISA, who shall be the Corporation and the Plan
II-3
<PAGE> 7
Administrator, and other parties designated as Fiduciaries by such
named fiduciaries in accordance with the powers provided herein, but
only with respect to the specific responsibilities of each in
connection with the Plan.
(k) PARTICIPANT - An Employee who has satisfied
the eligibility requirements of Section 3.1, and who has become
entitled to receive Severance Benefits under this Plan.
(l) PLAN - The 1993 Special Voluntary Severance
Plan for Salaried Employees of Intermet Foundries, Inc. and Its
Subsidiaries, the Plan set forth herein, as it may be amended from
time to time.
(m) PLAN ADMINISTRATOR - The Corporation, or an
entity or person appointed by the Corporation, which shall have
authority to administer the Plan as provided in Article VI.
(n) PLAN YEAR - The first Plan Year shall be the
short Plan Year beginning on October 1, 1993 and ending on December
31, 1993. Thereafter, the Plan Year shall be each January 1 through
December 31.
(o) PRE-TAX CONTRIBUTIONS - Pre-Tax contributions
that the Employee elects to make to (i) the Savings and Investment
Plan; (ii) the Intermet Salaried Employees Dependent Coverage Plan;
and (iii) any similar plans sponsored by the Corporation for its
salaried employees which provide for pre-tax employee contributions.
II-4
<PAGE> 8
The date designated by the Employer that will be the Participant's
last day of active employment.
(p) RETIREE MEDICAL AND LIFE INSURANCE COVERAGE
- The retiree medical and life insurance coverage provided to the
Employee as a retired salaried employee under the Intermet
Corporation Salaried Employees Comprehensive Medical Plan, as
it may be amended from time to time.
(q) SAVINGS AND INVESTMENT PLAN - The Intermet
Corporation Savings and Investment Plan, as it may be amended from
time to time.
(r) SEVERANCE AGREEMENT - The written agreement
between the Employee and the Employer (on a form provided by the
Employer) which is a condition precedent to the Employee's receiving
the Severance Benefits under the Plan. This Agreement is also the
form by which an eligible Employee voluntarily elects to terminate his
employment with the Employer and participate in the Plan. A copy of a
sample Severance Agreement intended for use in connection with this
Plan is attached hereto as Exhibit A.
(s) SEVERANCE BENEFITS - The various benefits
described in Article IV of the Plan which are payable to or on behalf
of an Employee who meets the eligibility requirements of this Plan and
who voluntarily elects between October 1, 1993 and November 19, 1993
to resign from employment.
II-5
<PAGE> 9
(t) SEVERANCE DATE - The date designated by the
Employer that will be the Participant's last day of active employment.
(u) SEVERANCE PAY - The severance pay payable to
a Participant in accordance with the provisions of Section 4.1.
(v) VACATION POLICY - The vacation policy that
applies to full-time salaried employees of the Employer and that
requires an Employee to be actively employed on December 31st of a
year to receive vacation benefits for the following year.
II-6
<PAGE> 10
ARTICLE III
Eligibility for Severance Benefits
An Employee shall only be eligible to receive Severance
Benefits under this Plan if he satisfies the requirements of Section 3.1(a)
below and executes a Severance Agreement as described in Section 3.1(b) below.
The amount and form of any Severance Benefits shall be determined in accordance
with Article IV.
3.1 Eligibility Requirements
(a) Age and Service Requirement - To be eligible
for benefits under the Plan, an Employee must be eligible for Normal
Retirement or Early Retirement under the Savings and Investment Plan
on or before March 31, 1994, by attaining (1) age 65, (2) age
fifty-five (55) and thirty (30) years of service, or (3) age sixty
(60) and ten (10) years of service, by that date. The determination
of an Employee's years of service shall be made in accordance with the
Savings and Investment Plan. If an Employee is not eligible for
Normal or Early Retirement as of his Severance Date, but the Employee
would meet such requirements by March 31, 1994, such an Employee will
be considered eligible for such retirement under the Savings
Investment Plan as of his Severance Date.
(b) Election to Resign and Execution of Severance
Agreement - An eligible Employee must voluntarily elect between
October 1, 1993 and November 19, 1993 to resign from employment with
the Employer. To make this
III-1
<PAGE> 11
election, an eligible Employee must complete, sign and not revoke a
Severance Agreement indicating his desire to terminate employment
voluntarily with the Employer. The signed Agreement must be received
by the Manager, Human Resources Administration (or such other person
as may be designated by the Plan Administrator), no later than 5:00
p.m., Eastern Standard Time, November 19, 1993. An Employee retains
the right to revoke a Severance Agreement for a period of seven (7)
days following the date of his execution of such Agreement. Such
revocation must be in writing, signed by the Employee and received by
the Manager, Human Resources Administration (or such other person as
may be designated by the Plan Administrator), prior to the termination
of the seven-day revocation period specified above. For purposes of
the deadlines in this paragraph, the Manager, Human Resources
Administration (or such other person as may be designated by the Plan
Administrator), shall be considered to have received an item at the
time and on the date she actually received the item, without regard to
when it was mailed or its delivery otherwise commenced.
(c) Severance Date - When an Employee satisfies
the requirements for participation set forth in (a) and (b) above, the
Employer will designate a Severance Date for the Employee. An
Employee must remain employed until his Severance Date in order to be
eligible for the Severance Benefits described in Article IV.
III-2
<PAGE> 12
(d) The Plan Administrator shall have the
exclusive discretionary authority to make any determinations relating
to the eligibility factors in (a), (b) and (c) above and to determine
whether an Employee is eligible to receive Severance Benefits under
this Plan.
III-3
<PAGE> 13
ARTICLE IV
Amount and Form of Severance Benefits
When an Employee satisfies the eligibility requirements of
Article III and becomes a Participant in the Plan, he shall be entitled to the
Severance Benefits set forth below.
4.1 Severance Pay - A Participant's Severance Pay shall
be equal to twenty-four (24) months of one-half (1/2) of Base Pay, determined
without regard to the Employee's years of service with the Employer. Severance
Pay shall be payable commencing after the Employee's Severance Date twice a
month in the same manner as the Employee had previously been paid. Severance
Pay shall be payable at one-half (1/2) of the rate of Base Pay, less deductions
for applicable local, state and federal taxes, any continuing benefits costs
and other legally required deductions (including amounts owed to the Employer).
The payment of any Severance Pay under this Article IV shall cease on the date
of death of the Participant, and no survivor benefit is payable. Severance Pay
will be reduced by any unemployment compensation or workers compensation weekly
income benefits a Participant receives during the period he is receiving
Severance Pay. The amount of Severance Pay will be offset and reduced by the
amount (if any) a Participant receives pursuant to the Worker Adjustment and
Retraining Notification Act (WARN).
4.2 Retiree Medical and Life Insurance Coverage - Because
a Participant in this Plan will be eligible for retirement under the Savings
and Investment Plan, he will be eligible for Retiree Medical and Life Insurance
Coverage. The
IV-1
<PAGE> 14
retiree coverages the Participant receives shall be in accordance with the
separate plan(s) providing for such coverages and shall be subject to the
amendment, restriction and limitation provisions of such plan(s).
4.3 Savings and Investment Plan and ESOP - (a) Except as
provided in (b) below, the active participation in the Savings and Investment
Plan and the ESOP of Participants in this Plan shall cease as of their
Severance Date. Payment of a Participant's benefits under the Savings and
Investment Plan and the ESOP will be made in accordance with the provisions of
those plans.
(b) The Savings and Investment Plan and the ESOP
will be amended in accordance with the amendments attached hereto as
Appendix B, to provide the following:
(i) If a Participant's Severance Date
is prior to December 31, 1993, the Employer
will make for 1993 a contribution equal to 2%
of annual compensation to the Savings and
Investment Plan and 3% of annual compensation
to the ESOP. Annual compensation shall be
determined in accordance with the respective
plan and shall include compensation received
through the Severance Date, but shall exclude
all Severance Pay. Except as otherwise
determined by the Corporation, the additional
contributions shall be made at
IV-2
<PAGE> 15
the time contributions are regularly made to
the plans.
(ii) If the Participant's Severance
Date is prior to the end of a calendar
quarter and he contributed to the Savings and
Investment Plan for that quarter, the
Employer will make the regular matching
contribution on the Participant's behalf.
(iii) Severance Pay and the period a
Participant receives Severance Pay shall not
be counted under the Savings and Investment
Plan or the ESOP as annual compensation or a
period of active employment entitling a
Participant to receive Employer contributions
under the plans.
4.4 Other Benefits - Except as provided in Sections 4.1,
4.2 and 4.3 above, the Employer-sponsored benefits provided to a Participant
shall cease as of the Participant's Severance Date. The benefits that will
cease shall include dental care, regular, dependent and optional life,
accidental death and dismemberment, short-term and long-term disability,
voluntary accident and vacation. A Participant will not earn vacation pay for
any period he is receiving Severance Pay. If a Participant's Severance Date is
during 1993, the Participant will be paid on his Severance Date for any unused
vacation he did not take during 1993. A Participant will also receive vacation
pay for the amount of vacation he is entitled to under the Vacation Policy in
IV-3
<PAGE> 16
1994 as a result of his employment during 1993, whether his Severance Date is
prior to or after December 31, 1993. The amount of this additional vacation
pay will be paid to the Participant in a lump sum with the first Severance Pay
check in January, 1994, or if he terminates in 1994, with his first paycheck
after his Severance Date.
IV-4
<PAGE> 17
ARTICLE V
Plan Financing
No assets of the Employer or the Corporation shall be
specifically set aside for the payment of benefits under this Plan (except for
contributions to the Savings and Investment Plan and the ESOP). Any benefits
payable under this Plan shall be paid solely out of the general assets of the
Employer or through the Intermet Corporation Salaried Employees Comprehensive
Medical Plan, and the obligation of the Employer is simply an obligation to
make payments according to the terms and conditions of this Plan. A
Participant's right to any payments hereunder shall be the same as that of any
unsecured general creditor of the Employer. Payments to a Participant from the
Savings and Investment Plan and ESOP shall be made from the trust funds
established under such plans.
V-1
<PAGE> 18
ARTICLE VI
Administration
6.1 Allocation of Responsibility Among Fiduciaries for
Plan Administration - The Fiduciaries shall have only those powers, duties,
responsibilities, and obligations as are specifically given or delegated to
them under this Plan. The Employer and the Corporation shall have the sole
responsibility for paying the benefits under this Plan described in Article IV,
and the Corporation shall have the sole authority to appoint and remove the
Plan Administrator, and to amend or terminate this Plan in whole or in part.
The Plan Administrator shall have the sole responsibility for the
administration of the Plan, which responsibility is specifically described
herein.
6.2 Administration - The Plan shall be administered by
the Plan Administrator which may appoint or employ individuals to assist in the
administration of the Plan and which may appoint or employ any other agents it
deems advisable, including legal counsel and auditors, to serve at the Plan
Administrator's direction. All usual and reasonable expenses of the Plan
Administrator in administering the Plan shall be paid in whole or in part by
the Employer.
6.3 Claims Procedure - The Plan Administrator shall have
the exclusive discretionary authority to construe and to interpret the Plan, to
decide all questions of eligibility for benefits and to determine the amount of
such benefits, and its decisions on such matters are final and conclusive. Any
exercise of this discretionary authority shall be reviewed by a court
VI-1
<PAGE> 19
under the arbitrary and capricious standard (i.e., the abuse of discretion
standard). If, pursuant to this discretionary authority, an assertion of any
right to a benefit by an Employee is wholly or partially denied, the Plan
Administrator, or a party designated by the Plan Administrator, will provide
such claimant, within the 90-day period following the receipt of the claim by
the Plan Administrator, a comprehensible written notice setting forth:
(a) The specific reason or reasons for such
denial;
(b) Specific reference to pertinent Plan
provisions on which the denial is based;
(c) A description of any additional material or
information necessary for the claimant to submit to perfect the
claim and an explanation of why such material or information is
necessary; and
(d) A description of the Plan's claim review
procedure. The claim review procedure is available upon written
request by the claimant to the Plan Administrator, or the designated
party, within 60 days after receipt by the claimant of written notice
of the denial of the claim, and includes the right to examine
pertinent documents and submit issues and comments in writing to the
Plan Administrator, or the designated party. The decision on
review shall be made within 60 days after receipt of the request for
review, unless circumstances warrant an extension of time not to
exceed an additional 60 days, and shall be in writing and
VI-2
<PAGE> 20
drafted in a manner calculated to be understood by the claimant, and
include specific reasons for the decision with references to the
specific Plan provisions on which the decision is based.
If within a reasonable period of time after the Plan receives the claim
asserted by the Employee, the Plan Administrator, or the designated party,
fails to provide a comprehensible written notice stating that the claim is
wholly or partially denied and setting forth the information described in (a)
through (d) above, the claim shall be deemed denied. Once the claim is deemed
denied, the Employee shall be entitled to the claim review procedure described
in subsection (d) above. Such review procedure shall be available upon written
request by the claimant to the Plan Administrator, or the designated party,
within 60 days after the claim is deemed denied.
6.4 Other Administrative Powers and Duties - The Plan
Administrator shall have such powers and duties as may be necessary to
discharge its functions hereunder, including but not limited to:
(a) To exercise its discretionary authority to
construe and interpret the Plan, decide all questions of eligibility
and determine the amount, manner and time of payment of any benefits
hereunder;
(b) To prescribe procedures to be followed by
Employees requesting benefits;
VI-3
<PAGE> 21
(c) To prepare and distribute, in such manner as
the Plan Administrator determines to be appropriate, information
explaining the Plan;
(d) To receive from Employees and agents and from
the Employer such information as shall be necessary for the proper
administration of the Plan;
(e) To appoint or employ individuals or other
parties to assist in the administration of the Plan and any other
agents it deems advisable, including accountants and legal counsel;
and
(f) To delegate to other persons or entities, or
to designate or employ persons to carry out any of the Plan
Administrator's fiduciary duties or responsibilities or other
functions under the Plan.
6.5 Authorization of Benefit Payments - The Plan
Administrator shall issue directions to the Employer concerning all benefits
which are to be paid pursuant to the provisions of the Plan, and shall warrant
that all such directions are in accordance with this Plan.
6.6 Facility of Payment - Whenever, in the Plan
Administrator's opinion, a Participant entitled to receive any payment of a
benefit or installment thereof hereunder is under a legal disability or is
incapacitated in any way so as to be unable to manage his financial affairs,
the Plan Administrator may direct the Employer to make payments to such person
or to the legal representative of such person for his benefit, or the Plan
Administrator may direct the Employer to apply the payment for
VI-4
<PAGE> 22
the benefit of such person in such manner as the Plan Administrator considers
advisable. Any payment of a benefit or installment thereof in accordance with
the provisions of this section shall be a complete discharge of any liability
for the making of such payment under the provisions of the Plan.
VI-5
<PAGE> 23
ARTICLE VII
Amendment of the Plan
The Corporation shall have the absolute right at any time by
instrument in writing to modify, alter or amend the Plan in whole or in part,
retroactively or otherwise, including, without limitation, the benefits
provided under the Plan. Provided, however, no such amendment shall diminish
or eliminate any payment of Severance Pay that a Participant had qualified for
and begun to receive prior to the date of such amendment. The Corporation's
right to amend the Plan shall not be affected or limited in any way by an
Employee's termination of employment. Prior practices by the Employer or the
Corporation, or any entity related to the Employer or the Corporation, shall
not diminish in any way the rights granted the Corporation under this Article.
Oral and other informal communications made by the Corporation or its
representatives concerning the Plan shall not give rise to any rights or
benefits other than those contained in the Plan described herein, and such
communications shall not diminish in any way the rights contained in this
article. Also, it is expressly permissible for an amendment to affect less
than all of the Employees covered by the Plan.
VII-1
<PAGE> 24
ARTICLE VIII
Termination
The Corporation and the Employer assume no obligation to
continue the Plan. The Corporation hereby reserves the right to terminate, or
to partially terminate, the Plan at any time for any reason. If the
Corporation decides to terminate or partially terminate the Plan, the Plan
Administrator shall be notified of such termination in writing and shall
proceed at the direction of the Corporation to take such steps as are necessary
to discontinue the operation of the Plan in an appropriate and timely manner.
Prior practices by the Employer or the Corporation, or any entity related to
the Employer or the Corporation, shall not diminish in any way the rights
granted the Corporation under this Article. Oral and other informal
communications made by the Corporation or its representatives concerning the
Plan shall not give rise to any rights or benefits other than those contained
in the Plan described herein, and such communications shall not diminish in any
way the rights contained in this article. Also, it is expressly permissible
for a partial termination to affect less than all of the Employees covered by
the Plan.
VIII-1
<PAGE> 25
ARTICLE IX
Miscellaneous
9.1 Other Severance Benefits - Employees who elect to
receive the benefits provided under the Plan shall not be eligible to receive
severance benefits under any other plan, program or policy maintained by the
Corporation, the Employer or their affiliates.
9.2 Nonguarantee of Employment - Nothing contained in
this Plan shall be construed as a contract of employment between the Employer
and any Employee, or as a right of any Employee to be continued in the
employment of the Employer, or as a limitation of the right of the Employer to
discharge any of its Employees, with or without cause.
9.3 Spendthrift Clause - Except to the extent mandated by
law, benefits payable under this Plan shall not be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
charge, garnishment, execution, or levy of any kind, either voluntary or
involuntary, and any attempt to anticipate, alienate, sell, transfer, assign,
pledge, encumber, charge or otherwise dispose of any right to benefits payable
hereunder, shall be void and of no force and effect whatsoever; provided,
however, that the benefits hereunder may be assigned or transferred to pay any
bona fide debt of the Participant to the Employer. The Plan shall not in any
manner be liable for, or subject to, the debts, contracts, liabilities,
engagements or torts of any person entitled to benefits hereunder.
IX-1
<PAGE> 26
9.4 Successor to the Corporation - In the event of the
dissolution, merger, consolidation or reorganization of the Corporation,
provision may be made by which the Plan will be continued by the successor,
and, in that event, such successor shall be substituted for the Corporation
under the Plan.
9.5 Delegation of Authority by the Corporation - Any
action by the Corporation under this Plan may be made by any person or persons
duly authorized by the Corporation to take such action.
9.6 Headings - The headings of sections and subsections
are for ease of reference only and shall not be construed to limit or modify
the detailed provisions thereof.
IX-2
<PAGE> 27
ARTICLE X
Applicable Law
The provisions of the Plan shall be construed and administered
according to, and its validity and enforceability shall be determined under
ERISA. In the event ERISA does not preempt state law in a particular
circumstance, the laws of the State of Georgia shall govern.
If any provision of this Plan is, or is hereafter declared to
be void, voidable, invalid or otherwise unlawful, the remainder of the Plan
shall not be affected thereby.
X-1
<PAGE> 28
ARTICLE XI
Signature
The above Plan is hereby adopted and approved, to be effective as of
October 1, 1993.
INTERMET CORPORATION
By: /s/ James W. Rydel
----------------------------
Title: V.P. Human Resources
XI-1
<PAGE> 29
APPENDIX A
SEVERANCE AGREEMENT
I, ______________________________, the undersigned, hereby acknowledge
receipt of a copy of the Summary Plan Description ("SPD") for the 1993 Special
Voluntary Severance Plan for Subsidiaries (the "Plan"). I also acknowledge
that I have been given forty-five (45) days to review the SPD, to review this
Agreement, and to decide whether or not to accept the terms and conditions
required for my receipt of the Special Severance Benefits (hereinafter
"Severance Benefits") offered as part of the Plan. I certify that I have had
the opportunity to obtain all advice and information I deem necessary with
respect to the matters covered by this Agreement and the SPD, including the
opportunity to consult with legal counsel or anyone else of my choosing. By my
execution of this Severance Agreement, I voluntarily choose to participate in
the Plan, to resign from my employment, and to accept the Severance Benefits
under the Plan. I understand and agree that I must remain employed until my
Severance Date, as defined in the Plan, in order to be eligible for benefits
under the Plan.
I agree not to take any action which disparages or criticizes
Intermet Foundries, Inc., Intermet Corporation or their affiliated
corporations, hereinafter collectively referred to as "the Company," or its
management or practices or which disrupts or impairs its normal operations,
including actions which would result in the filing of any claims, lawsuits or
charges against the Company as a result of anything which has occurred up to
and including the present date.
In addition, and in further consideration of my receiving the
Severance Benefits, including additional Severance Pay equal to 24 months of
one-half of base pay, as defined in the Plan, payable $________________, less
applicable deductions, twice per month; I hereby agree to release and discharge
the Company, its officers, directors and employees from any and all claims,
losses or expenses I now have or have had, or may later claim to have had
against them arising out of my employment with the Company or termination
therefrom. I understand and agree that I will not be entitled hereafter to
pursue any claims arising out of any alleged violation of my rights while
employed by the Company, including, but not limited to claims for back pay,
losses or other damages to me or my property resulting from any alleged
violation of state or federal law, such as (but not limited to) claims arising
under Title VII of the Civil Rights Act of 1964, 42 U.S.C. Section 2000e, et.
seq. (prohibiting discrimination on account of race, sex, national origin or
religion); claims arising under the Age
A-1
<PAGE> 30
Discrimination in Employment Act of 1967, 29 U.S.C. Sections 621, et.
seq. (prohibiting discrimination on account of age); claims under the Employee
Retirement Income Security Act of 1974, as amended (ERISA), 29 U.S.A. Section
1001, et. seq.; claims under the Americans with Disabilities Act of 1990 (ADA)
42 U.S.C. Sections 12101-12213 (Supp. II 1990); and any similar federal
or state law claim relating to my employment.
By signing this Agreement and accepting the Severance Benefits
provided by the Plan, I agree that I will not hereafter pursue any individual
claim against the Company, its officers, directors and employees, in any state
or federal court, or before any state or federal agency, including, for
example, the Equal Employment Opportunity Commission or the Department of
Labor, for or on account of anything which has occurred up to the present time
as a result of amy employment or the termination of my employment with the
Company. I also understand and agree that the Company will have no obligation
to re-employ me.
I understand that, for a period up to and including seven (7)
days after the date I sign this Agreement, I may revoke it entirely. No rights
or obligations contained in this Agreement shall become enforceable before the
end of this seven-day revocation period. If I decide to revoke the Agreement,
I will deliver to the Company a signed Notice of Revocation on or before the
end of this seven-day period. Upon delivery of a timely Notice of Revocation,
this Agreement shall be cancelled and void and neither party to this Agreement
shall have any rights or obligations arising under it.
I FURTHER ACKNOWLEDGE AND AGREE THAT NO OTHER PROMISE OR
AGREEMENT OF ANY KIND HAS BEEN MADE TO ME BY THE COMPANY TO CAUSE ME TO EXECUTE
THIS AGREEMENT AND THAT THE ONLY CONSIDERATION FOR MY EXECUTION OF THIS
AGREEMENT IS SET FORTH COMPLETELY AND FULLY IN THIS DOCUMENT AND IN THE 1993
SPECIAL VOLUNTARY SEVERANCE PLAN FOR SALARIED EMPLOYEES OF INTERMET FOUNDRIES,
INC. AND ITS SUBSIDIARIES. I HAVE CAREFULLY READ THIS AGREEMENT, I UNDERSTAND
ITS MEANING AND INTENT, AND I VOLUNTARILY AGREE TO ABIDE BY ITS TERMS. I
ACKNOWLEDGE RECEIVING A COPY OF THIS AGREEMENT AND SUMMARY PLAN DESCRIPTION FOR
MY PERSONAL RECORDS.
FOR THE COMPANY: EMPLOYEE'S SIGNATURE:
- ------------------------- ---------------------------------
Date: Date:
- ------------------------- ---------------------------------
A-2
<PAGE> 31
APPENDIX B
AMENDMENT NO. 2 TO THE
INTERMET CORPORATION SAVINGS AND
INVESTMENT PLAN AND TRUST
(As Amended and Restated Effective As of January 1, 1989)
This Amendment made and entered into as of this 1st day of
October, 1993, by and between Intermet Corporation, a Georgia corporation
(referred to as the "Employer"), and Trust Company Bank, as trustee (referred
to herein as the "Trustee");
W I T N E S S E T H:
WHEREAS, the Employer previously established for the exclusive
benefit of its eligible employees a profit sharing plan and trust known as the
Intermet Corporation Savings and Investment Plan and Trust (the "Plan"); and
WHEREAS, the Plan has been amended from time to time; and
WHEREAS, effective October 1, 1993, the Employer adopted a
special voluntary severance plan for eligible salaried employees of Intermet
Foundries, Inc. and its subsidiaries, known as the 1993 Special Voluntary
Severance Plan for Salaried Employees of Intermet Foundries, Inc. and Its
Subsidiaries (the "1993 Special Voluntary Severance Plan"); and
WHEREAS, because Participants who elect to resign from
employment under the 1993 Special Voluntary Severance Plan will cease
employment with the Employer and active participation under this Plan effective
as of their "Severance Date," as that term is defined in the 1993 Special
Voluntary Severance Plan, the parties desire to amend the Plan to provide
special provisions for Participants electing to participate in the 1993 Special
1
<PAGE> 32
Participants electing to participate in the 1993 Special Voluntary Severance
Plan and to clarify the Plan's provisions relating to severance pay;
NOW, THEREFORE, for and in consideration of the premises and
mutual covenants contained herein, the parties hereto agree as follows:
1.
Section 2.1 is hereby amended by adding the following at the
end of the present section:
"Annual Compensation shall not include any amounts paid
to a Participant or former Participant as severance pay
pursuant to any plan, program or policy of the Employer."
2.
Article III is hereby amended by adding the following
new Section 3.9:
"3.9 Participation in the 1993 Special Voluntary
Severance Plan -
(a) In General - This Section shall apply only to
those Participants who are eligible for, and elect to
participate in, the 1993 Special Voluntary Severance
Plan for Salaried Employees of Intermet Foundries,
Inc. and Its Subsidiaries (the "1993 Special
Voluntary Severance Plan"). The terms "Severance
Date" and "Severance Pay" shall have the meanings
given them under the 1993 Special Voluntary Severance
Plan and such definitions are expressly incorporated
herein by reference. Notwithstanding the provisions
of this Section 3.9, the Employer may restrict the
benefits of any Highly Compensated Employee in order
to satisfy the applicable non-discrimination
requirements of the Code.
(b) Service - Except as otherwise provided in
this Section 3.9, a Participant who elects to
participate in the 1993 Special Voluntary
2
<PAGE> 33
Severance Plan shall cease active participation in
this Plan for all purposes effective as of his
Severance Date. Such Participant shall not be
eligible to participate in Pay Transfers, Matching
Contributions, Profit Sharing Contributions or
allocations of Forfeitures pursuant to Sections 4.1,
4.3 and 5.4 of the Plan, respectively, for any period
that such Participant receives Severance Pay.
(c) Matching Contributions - Notwithstanding the
requirement in Section 4.3(a) that a Participant be
an active Employee on the last day of the Calendar
Quarter in order to receive a Matching Contribution
for such Calendar Quarter, if the Participant elects
to participate in the 1993 Special Voluntary
Severance Plan and such Participant is not an active
Employee on the last day of a Calendar Quarter for
which he has made Pay Transfers because the
Participant incurred his Severance Date during such
Calendar Quarter, he shall nevertheless be eligible
to receive a Matching Contribution in accordance with
Section 4.3(a) of the Plan for the Calendar Quarter
during which the Participant's Severance Date occurs.
(d) 1993 Profit Sharing Contributions - For the
Plan year ending December 31, 1993 only (the "1993
Plan Year"), the Employer shall make a one-time
Profit Sharing Contribution pursuant to Section
4.3(c) of the Plan for each Participant who: (i)
elects to participate in the 1993 Special Voluntary
Severance Plan; (ii) has a Severance Date prior to
December 31, 1993; and (iii) has a Year of Service
for the 1993 Plan Year.
(e) Annual Compensation - For purposes of the
Matching Contributions and Profit Sharing
Contributions made under this Section 3.9, Annual
Compensation shall only include a Participant's
Annual Compensation received through the
Participant's Severance Date and shall not include
any Severance Pay.
(f) Early or Normal Retirement - A Participant
who is eligible for, and elects to participate in,
the 1993 Special Voluntary Severance Plan, but who
does not satisfy the requirements of Section 6.1 as
of his Severance Date, shall be granted such
additional age and/or service under this Plan so that
he satisfies the requirements of Section 6.1(a) or
6.1(b) of the Plan as of his Severance
3
<PAGE> 34
Date, without regard to the Participant's actual
Severance Date under the 1993 Special Voluntary
Severance Plan."
3.
The provisions of this Amendment No. 2 shall be effective as
of October 1, 1993.
4.
Except as hereby modified, the Plan shall remain in full
force and effect.
IN WITNESS WHEREOF, the parties have caused this amendment No.
2 to be duly executed as of the day and the year first above written.
EMPLOYER:
INTERMET CORPORATION
By:
---------------------------
Title:
------------------------
TRUSTEE:
TRUST COMPANY BANK
By:
---------------------------
Title:
------------------------
4
<PAGE> 35
APPENDIX B
AMENDMENT NO. 4 TO THE
INTERMET CORPORATION EMPLOYEE STOCK
OWNERSHIP PLAN AND TRUST (1987)
(As Adopted Effective As of January 1, 1987)
This Amendment made and entered into as of this 1st day of
October, 1993, by and between Intermet Corporation, a Georgia corporation
(referred to as the "Employer"), and Trust Company Bank, as trustee (referred
to herein as the "Trustee");
W I T N E S S E T H:
WHEREAS, the Employer previously established for the exclusive
benefit of its eligible employees the Intermet Corporation Employee Stock
Ownership Plan and Trust (1987) (the "Plan"); and
WHEREAS, the Plan has been amended from time to time; and
WHEREAS, effective October 1, 1993, the Employer adopted a
special voluntary severance plan for eligible salaried employees of Intermet
Foundries, Inc. and its subsidiaries, known as the 1993 Special Voluntary
Severance Plan for Salaried Employees of Intermet Foundries, Inc. and Its
Subsidiaries (the "1993 Special Voluntary Severance Plan"); and
WHEREAS, because Participants who elect to resign from
employment under the 1993 Special Voluntary Severance Plan will cease
employment with the Employer and active participation under this Plan effective
as of their "Severance Date," as that term is defined in the 1993 Special
Voluntary Severance Plan, the parties desire to amend the Plan to provide
special provisions for Participants electing to participate in the 1993 Special
1
<PAGE> 36
Voluntary Severance Plan and to clarify the Plan's provisions relating to
severance pay;
NOW, THEREFORE, for and in consideration of the premises and
mutual covenants contained herein, the parties hereto agree as follows:
1.
Section 1.2 is hereby amended by adding the following at the
end of the present section:
"Annual Compensation shall not include any amounts
paid to a Participant or former Participant as
severance pay pursuant to any plan, program or
policy of the Employer."
2.
Article II is hereby amended by adding the following
new Section 2.9:
"2.9 Participation in the 1993 Special Voluntary
Severance Plan -
(a) In General - This Section shall apply only to
those Participants who are eligible for, and elect to
participate in, the 1993 Special Voluntary Severance
Plan for Salaried Employees of Intermet Foundries,
Inc. and Its Subsidiaries (the "1993 Special
Voluntary Severance Plan"). The terms "Severance
Date" and "Severance Pay" shall have the meanings
given them under the 1993 Special Voluntary Severance
Plan, and such definitions are expressly incorporated
herein by reference. Notwithstanding the provisions
of this Section 2.9, the Employer may restrict the
benefits of any Highly Compensated Employee in order
to satisfy the applicable non-discrimination
requirements of the Code.
(b) Service - Except as otherwise provided in
this Section 2.9, a Participant who elects to
participate in the 1993 Special Voluntary Severance
Plan shall cease active participation in this Plan
for all purposes effective as of his Severance Date.
Such Participant shall not be eligible to participate
in Employer Contributions or allocations of
Forfeitures, pursuant
2
<PAGE> 37
to Sections 3.1, 4.3 and 4.4 of the Plan for the
period that such Participant receives Severance Pay.
(c) 1993 Employer Contributions - For the Plan
Year ending December 31, 1993 only (the "1993 Plan
Year"), the Employer shall make a one-time Employer
Contribution pursuant to Section 3.1 of the Plan for
each Participant who: (i) elects to participate in
the 1993 Special Voluntary Severance Plan; (ii) has a
Severance Date prior to December 31, 1993; and (iii)
has a Year of Service for the 1993 Plan Year.
(d) Annual Compensation - For purposes of the
Employer Contribution made under this Section 2.9,
Annual Compensation shall only include a
Participant's Annual Compensation received through
the Participant's Severance Date and shall not
include any Severance Pay.
(e) Early or Normal Retirement - A Participant
who is eligible for, and elects to participate in,
the 1993 Special Voluntary Severance Plan, but who
does not satisfy the requirements of Section 5.1 as
of his Severance Date, shall be granted such
additional age and/or service under this Plan so that
he satisfies the requirements of Section 5.1(a) or
5.1(b) of the Plan as of his Severance Date, without
regard to the Participant's actual Severance Date
under the 1993 Special Voluntary Severance Plan."
4.
The provisions of this Amendment No. 4 shall be effective as
of October 1, 1993.
5.
Except as hereby modified, the Plan shall remain in full
force and effect.
3
<PAGE> 38
IN WITNESS WHEREOF, the parties have caused this Amendment No.
4 to be duly executed as of the day and the year first above written.
EMPLOYER: TRUSTEE:
INTERMET CORPORATION TRUST COMPANY BANK
By: By:
--------------------------- ----------------------
Title: Title:
------------------------ -------------------
4
<PAGE> 1
EXHIBIT 10.19(b)
AMENDMENT NO. 1 TO THE
INTERMET CORPORATION SAVINGS AND
INVESTMENT PLAN AND TRUST
(As Amended and Restated Effective As Of January 1, 1989)
This Amendment made and entered into this 13 day of April, 1992, by
and between Intermet Corporation, a Georgia corporation (referred to as the
"Employer"), and Trust Company Bank, as trustee (referred to herein as the
"Trustee");
W I T N E S S E T H:
WHEREAS, the Employer previously established for the exclusive benefit
of its eligible employees a profit sharing plan and trust known as the Intermet
Corporation Savings and Investment Plan and Trust (the "Plan"); and
WHEREAS, the Plan was amended and restated effective as of January 1,
1989; and
WHEREAS, the parties now desire to amend the Plan in accordance with
the power of amendment contained therein;
NOW, THEREFORE, for and in consideration of the premises and the
mutual covenants contained herein, the parties hereto agree as follows:
1.
Section 2.1 of the Plan is hereby amended by deleting the present
provision and substituting the following:
"2.1 Annual Compensation - For purposes of (i) determining
the amount an Employee may elect to contribute on a pre-tax basis to
the Plan, and (ii) the allocation of the Employer's Matching
Contribution and Profit Sharing Contribution, Annual Compensation
means the Participant's remuneration from the Employer for the Plan
Year determined in accordance with Code Section 414(s) (or Code
Section 415(c)(3) if required),
<PAGE> 2
including wages, salary, overtime pay, bonuses, commissions and
performance award payments and all elective contributions made by the
Employer on behalf of the Employee under Sections 125, 402(a)(8),
402(h) or 403(b) of the Code, but excluding indirect payments such as
contributions made by the Employer to this or any other profit sharing
plan or pension plan, welfare plan, group insurance plan, etc., unless
specifically included under this Section 2.1. Notwithstanding the
foregoing, the Employer may elect to use any method of determining
Annual Compensation for any other purpose under the Plan, including
nondiscrimination testing, provided that such method is permissible
under the Code and regulations thereunder. For Plan Years commencing
on January 1, 1989 and thereafter, the Annual Compensation of any
Employee taken into account under the Plan for any Plan Year shall not
exceed $200,000, as adjusted under Section 415(d) of the Code,
provided that in the case of a Participant who is a member of the
family of: (i) a 5% owner or (ii) a Highly Compensated Employee in
the group consisting of the 10 Highly Compensated Employees paid the
greatest Annual Compensation during such Plan Year, each Participant's
Annual Compensation shall include any Annual Compensation received
from the Employer by such Participant's spouse and any lineal
descendants of the Participant who have not attained age 19 before the
close of such Plan Year. For purposes of determining the amount a
Participant may elect to contribute to the Plan as a Pay Transfer,
only Annual Compensation earned while the Participant participated in
the Plan shall be considered."
2.
Section 3.2(b) of the Plan is amended by inserting the following
phrase at the end of the current provision:
", provided that such Employee shall not be required to complete a
minimum number of Hours of Service during such six-month period."
3.
Section 3.3(c) of the Plan is hereby amended by deleting the first
sentence of the existing provision and substituting the following:
-2-
<PAGE> 3
"Except as otherwise provided herein, in addition to Service credited
under Section 3.3(a) and (b), for purposes of eligibility and vesting,
an Employee's period of employment with INTAT Precision, Inc., New
River Castings Company, and such other joint ventures or other
entities related to the Company and designated as the Plan
Administrator from time to time, shall be counted as Service
hereunder, but only for such period during which such other entity is
related to the Company."
4.
Section 4.2 of the Plan is amended by adding the following new
subsection 4.2(c)(iii):
"(iii) In the event that the multiple use limitation set
forth in Section 1.401(m)-2(b) of the Regulations applies, the
provisions of Section 4.4(e) of the Plan shall govern."
5.
Section 4.2(e) of the Plan is amended by inserting, after the first
full sentence in the first full paragraph, the following sentence:
"The amount of Excess Contributions that may be distributed with
respect to an Employee for a Plan Year is reduced by any Excess
Contributions previously distributed to the Employee for the
Employee's taxable year ending with or within the Plan Year."
6.
Section 4.2(e) of the Plan is further amended by placing a period
(".") after the word "tested" and deleting the following phrase from the third
sentence of the current provision:
", plus the allocable income for the period between the end of such
Plan Year and the date of distribution of such Excess Contributions
(the "gap period")."
-3-
<PAGE> 4
7.
Section 4.3 of the Plan is hereby amended by adding the following new
subsection 4.3(f):
"(f) Excess Forfeitures - If the Forfeitures associated with
Matching Contributions for any Plan Year exceed the amount required to
be contributed by the Employer or Company as a Matching Contribution
for such Plan Year, such excess Forfeitures shall be used to reduce
the amount required to be contributed by the Employer or Company as a
Profit Sharing Contribution for such Plan Year. If the Forfeitures
associated with Profit Sharing Contributions for any Plan Year exceed
the amount required to be contributed by the Employer or Company as a
Profit Sharing Contribution for such Plan Year, such excess
Forfeitures shall be used to reduce the amount required to be
contributed by the Employer or Company as a Matching Contribution for
such Plan Year."
8.
Section 4.4(e) of the Plan is amended by adding the following sentence
at the end of the current provision:
"Further, provided, in the event that the multiple use limitation as
set forth in Section 1.401(m)-2(b) of the Regulations applies with
respect to any Highly Compensated Employee, the Actual Deferral
Percentages of each Highly Compensated Employee, shall be reduced
(beginning with such Highly Compensated Employee whose Actual Deferral
Percentage is highest) so that the multiple use limitation is not
exceeded. The amount by which each Highly Compensated Employee's
Actual Deferral Percentage is reduced shall be treated as an Excess
Contribution as provided under Section 4.2(e)."
9.
Section 4.4(g) of the Plan is amended by inserting a period "." after
the word "tested" and deleting the following phrase in the first sentence of the
current provision:
", plus the allocable income for the period between the end of such
Plan Year and the date of distribution of such excess (the "gap
period")."
-4-
<PAGE> 5
10.
Section 5.2(b)(1) of the Plan is hereby amended by adding the
following paragraph after the first full paragraph in the current provision:
"Notwithstanding the foregoing, effective January 1, 1992, a
Participant shall be given the opportunity to change the investment
direction of his Participant Directed Amount on a quarterly basis each
January 1, April 1, July 1 or October 1. Such change in the
investment direction of a Participant's future savings shall be
effective for the first payroll period which begins on or after
January 1, April 1, July 1 or October 1, whichever applies."
11.
Section 5.3(b) of the Plan is hereby amended by deleting the present
provision and substituting the following:
"(b) The Plan Administrator, or its agent, shall make
appropriate adjustments in the Employer Contribution Accounts, Pre-tax
Accounts, ESOP Transfer Accounts and Rollover Accounts of all
Participants, former Participants and Beneficiaries who have unpaid
balances in their accounts at such time, by allocating pro rata among
such accounts based on the respective balances thereof as of the
preceding Valuation Date (plus one-half of all contributions made
since such preceding Valuation Date, less any distributions or
withdrawals since such preceding Valuation Date), any increases or
decreases in the value of the assets of the appropriate separate
investment funds of the Trust Fund, any income (other than
contributions) or expenses or costs, and any realized gains and losses
of the appropriate separate investment funds of the Trust Fund since
such preceding Valuation Date."
12.
Section 5.4(a) of the Plan is hereby amended by deleting the second
sentence of the existing provision and substituting the following:
-5-
<PAGE> 6
"If the Participant has no Vested Interest in his Employer
Contribution Account, subject to Section 5.4(c), his entire Employer
Contribution Account shall be forfeited and allocated as provided in
Section 4.3 as of the Annual Valuation Date for the Plan Year in which
payment of the terminated Participant's Vested Interest in his Pre-tax
Account commences."
13.
Section 5.4(c) of the Plan is hereby amended by deleting the present
provision and substituting the following:
"(c) Participant With No Vested Interest - If a Participant
who has no Vested Interest in his Employer Contribution Account
terminates Employment, and if the Participant is reemployed by the
Employer prior to incurring five (5) consecutive one (1) year Breaks
in Service, upon such reemployment, the amount in his Employer
Contribution Account at the time he terminated Employment shall be
restored, either out of Forfeitures or Trust earnings attributable to
the Plan Year in which he is reemployed, or by an additional Employer
Contribution, as determined in the sole discretion of the Plan
Administrator."
14.
Section 6.4 is hereby amended by deleting the first sentence of the
present provision and substituting the following:
"In the event a Participant shall become disabled (as hereinafter
defined) while actively employed, if such Participant terminates
Employment due to the disability, he shall be entitled to receive the
entire amount of his interest in the Plan, computed as of the
Valuation Date coincident with or next preceding the date he is
determined to be disabled by the Plan Administrator."
15.
Section 6.5 of the Plan is amended by inserting the following new
paragraph after the first full paragraph of the current provision:
-6-
<PAGE> 7
"Provided, however, that the vested percentage of an
individual who is not credited with an Hour of Service on or after
January 1, 1989, shall be determined in accordance with the vesting
schedule in effect at the time such individual terminated Employment.
Notwithstanding the foregoing provisions, in no event shall the
operation of the foregoing vesting schedule decrease the Vested
Interest of any Participant determined as of the day before the date
the revised vesting schedule became effective. Further, provided,
however, that any Participant who has three (3) or more years of
service shall have the right to elect (during the Election Period as
defined in Section 13.4 of the Plan) to continue to have his Vested
Interest determined in accordance with the vesting schedule in effect
prior to the effective date of the revised vesting schedule."
16.
Effective as of October 1, 1992, Section 6.5 of the Plan is further
amended by deleting the last paragraph of the existing provision and
substituting the following:
"Notwithstanding Section 6.1(b), a Participant who terminates
Employment prior to October 1, 1992 and prior to attaining age
fifty-five (55), but who has completed at least thirty (30) Years of
Service shall be eligible to request payment of his Vested Interest as
of any day coincident with or following this fifty-fifth (55th)
birthday. A Participant who terminates Employment prior to attaining
age 60 but who has completed at least ten (10) Years of Service shall
be eligible to request payment of his Vested Interest as of any day
coincident with or following his sixtieth (60th) birthday. Such
Vested Interest shall be determined as of the Valuation Date
coincident with or next preceding such election to receive his Vested
Interest in the Plan, and shall be payable to the Participant as
described in Section 6.7(b), treating such Participant as a
Participant who terminated Employment under Section 6.5 and not as a
retiree under the Plan. A Participant who terminates Employment on or
after October 1, 1992 and who is eligible for benefits under this
Section 6.5 shall be eligible to receive payment of his Vested
Interest in accordance with Section 6.7(b)(1) or (b)(3) as applicable,
provided that such Participant shall not be treated as a retiree under
the Plan."
-7-
<PAGE> 8
17.
Effective as of October 1, 1992, Section 6.6 of the Plan is hereby
amended by deleting the first paragraph of the existing provision and
substituting the following:
"6.6 Hardship Withdrawals - A Participant may request a
withdrawal on account of a hardship in accordance with the provisions
of this Section 6.6. The amounts available for a hardship withdrawal
shall be as follows: (i) all of the Participant's Pay Transfers
through December 31, 1988 plus interest and earnings thereon through
December 31, 1988, plus (ii) the Participant's Pay Transfers after
December 31, 1988 (excluding interest and earnings thereon), plus
(iii) the Participant's Rollover Account. A Participant may request a
hardship withdrawal not more than once each calendar quarter,
provided, however, this limitation shall not apply in the case of a
hardship withdrawal request necessitated by the serious illness,
injury or accident of a Participant and/or a member of his family. A
hardship withdrawal request shall be made in writing to the Plan
Administrator in the form prescribed by the Plan Administrator;
provided, however, such hardship withdrawals shall only be permitted
under the following circumstances:"
18.
Effective as of October 1, 1992, Sections 6.7(b) and (c) of the Plan
are hereby amended by deleting the present provisions and substituting the
following:
"(b) Payment on Account of Termination of Employment -
(1) Vested Interest of $3,500 or Less - In the event
a Participant becomes entitled to payment under Section 6.5,
if a Participant's entire Vested Interest is $3,500 or less,
such Vested Interest shall be paid as a lump sum as soon as
administratively practicable following the Participant's
termination of Employment. If such Vested Interest exceeds
$3,500, such Vested Interest shall be paid in
-8-
<PAGE> 9
accordance with Sections 6.7(b)(2), (3) and (4).
(2) Termination of Employment Prior to October 1,
1992 -
(i) Vested Interest in Excess of $3,500:
Payment of Pre-tax Account and Rollover Account - In
the event the Participant terminates Employment prior
to October 1, 1992 and becomes entitled to payment
under Section 6.5, if his entire Vested Interest
exceeds $3,500, with the consent of the Participant,
the amount in his Pre-tax Account and Rollover
Account shall be payable as a lump sum within a
reasonable time following the valuation of such
interest. Payment of his interest in his Employer
Contribution Account shall be made in accordance with
Section 6.7(b)(2)(ii). If the Participant fails to
consent to a distribution under this Section
6.7(b)(2) at the time of his termination of
Employment, the Participant may later request that
his entire Vested Interest in the Plan be paid as a
lump sum as soon as administratively practicable
after any Valuation Date that is coincident with or
immediately follows the date that would have been the
Participant's earliest retirement date under the Plan
in accordance with Section 6.1, provided, however,
that such Participant shall not be treated as a
retiree under the Plan. The earliest retirement age
under Section 6.1 and this Section 6.7(b) is age 55
if the Participant has 30 or more Years of Service
and age 60 if the Participant has less than 30 but 10
or more Years of Service. In all other cases, the
earliest retirement date shall be the Participant's
Normal Retirement Date had he remained in Employment.
If the Participant does not request payment of such
interest prior to his Normal Retirement Date, then
such interest shall be paid in the form selected by
the Participant under Section 6.7(c) as soon as
administratively practicable following the Valuation
Date that is coincident with or immediately precedes
the date that would have been the Participant's
Normal Retirement Date had he remained in Employment.
-9-
<PAGE> 10
(ii) Vested Interest in Excess of $3,500:
Payment of Employer Contribution Account Prior to
Normal Retirement Date - In the event the Participant
terminates Employment prior to October 1, 1992 and
becomes entitled to payment under Section 6.5, if his
entire Vested Interest exceeds $3,500, with the
consent of the Participant, payment of his Vested
Interest in his Employer Contribution Account shall
be made in five equal annual installments, adjusted
for net income earned on the undistributed balance,
commencing as soon as administratively practicable
after the Valuation Date that is coincident with or
immediately follows the date that is twelve months
after the Participant's termination of Employment.
If at the time payments are to commence each
installment would be less than $1,000, then the
entire amount of the Participant's Vested Interest in
his Employer Contribution Account shall be paid as a
lump sum. If the consent of the Participant is
required and the Participant does not consent to
receive a distribution, the Participant may later
request that his entire Vested Interest in his
Employer Contribution Account be paid in five equal
annual installments (or in a lump sum if each annual
installment would be less than $1,000) as soon as
administratively practicable after any Valuation Date
that is coincident with or immediately follows the
date that would have been the Participant's earliest
retirement date under the Plan (as described in
Section 6.7(b)(2)(i) provided, however, that such
Participant shall not be treated as a retiree under
the Plan. If the Participant does not request that
distributions commence prior to the date that would
have been his Normal Retirement Date had he remained
in Employment, such interest shall be paid in
accordance with Section 6.7(b)(4).
(3) Termination of Employment On or After October 1,
1992: Vested Interest in Excess of $3,500 - If a Participant
terminates Employment on or after October 1, 1992, payment of
his Vested Interest shall be made as soon as administratively
practicable following the Participant's termination of
Employment if the Participant
-10-
<PAGE> 11
consents to such distribution. If the Participant does not
consent to such distribution, he may later request payment of
his Vested Interest, as of any subsequent Valuation Date, upon
written notice to the Plan Administrator, with payment to be
made in the form elected by the Participant under Section
6.7(c), beginning as soon as administratively practicable
following the Valuation Date designated by the Participant.
(4) Vested Interest in Excess of $3,500: Payment of
Vested Interest Subsequent to Normal Retirement Date - If the
former Participant entitled to payment under Section 6.5 does
not consent to or request the distribution of all or a portion
of his Vested Interest in the Plan under Section 6.5(b)(2) or
(3) prior to the date that would have been his Normal
Retirement Date, then such Vested Interest shall be paid in
the form selected by the Participant under Section 6.7(c) as
soon as administratively practicable following the Valuation
Date that is coincident with or immediately precedes the date
that would have been the Participant's Normal Retirement Date
had he remained in Employment.
(c) Methods of Payment - Except as restricted in Section
6.7(b)(2), the available modes of payment of benefits under the Plan
are as follows:
(i) Distribution in full (lump sum) during any single
calendar year; or
(ii) Five substantially equal annual installments,
adjusted for income earned on the undistributed balance,
commencing as soon as administratively practicable after the
Participant becomes entitled to payment, provided, however, if
at the time payments are to commence, each installment is
$1,000 or less, then the interest shall be paid in a lump sum.
If a Participant who is otherwise entitled to elect the method of
payment of his benefit fails to make such election, his benefit shall
be paid in the form of a lump sum."
-11-
<PAGE> 12
19.
Section 8.3 of the Plan is hereby amended by deleting the first
sentence of the present provision and substituting the following:
"The Plan Administrator shall have the sole and exclusive
discretionary power to construe and interpret the Plan, and to
determine all questions that may arise thereunder, including, but not
limited to, (a) the eligibility of individuals to participate in the
Plan, (b) the amount of benefits to which any Participant or
Beneficiary may become entitled hereunder, and (c) any situation not
specifically covered by the provisions of the Plan, and the Plan
Administrator's decisions on such matters shall be final and binding
on all parties."
20.
Article X of the Plan is amended by adding the following sentence to
the end of the second paragraph in the current Article X:
"In the event of an amendment to the vesting schedule contained in the
Plan, such amendment shall be in accordance with provisions of Section
6.5 of the Plan."
21.
The last sentence of Article XI is deleted and replaced with the
following sentence:
"In the event of the termination, the partial termination, or the
complete discontinuance of contributions to the Plan, each affected
Participant shall become fully vested in his Employer Contribution
Account."
22.
Schedule A, the list of authorized adopting Employers, is hereby
amended by adding the following Employers:
-12-
<PAGE> 13
<TABLE>
<CAPTION>
Authorized Date of Eligible
Employers Participation Employee Group
- ---------- ------------- --------------
<S> <C> <C>
PBM Industries, Inc. April 1, 1992 Salaried Employees
Intermotive April 1, 1992 Salaried Employees
Technologies, Inc.
(formerly Batten
Design and Engineering
Services, Inc.)
</TABLE>
23.
The provisions of Paragraphs 6, 9 and 10 above shall be effective as
of January 1, 1992. Paragraphs 16, 17 and 18 shall be effective as of October
1, 1992. Paragraph 22 shall be effective as of April 1, 1992. Unless
otherwise provided, the provisions of all the other Paragraphs of this
Amendment No. 1 shall be effective as of January 1, 1989.
24.
Except as hereinabove amended, the Plan in all other
sections shall remain in full force and effect.
IN WITNESS WHEREOF, the parties have caused this Amendment No. 1 to be
duly executed as of the day and the year first above written.
EMPLOYER:
INTERMET CORPORATION
By: /s/ James W. Rydel
---------------------------------
Title: V.P. Human Resources
------------------------------
TRUSTEE:
TRUST COMPANY BANK
By:
---------------------------------
Title: Vice President
------------------------------
-13-
<PAGE> 1
EXHIBIT 10.19(c)
AMENDMENT NO. 2 TO THE
INTERMET CORPORATION SAVINGS AND
INVESTMENT PLAN AND TRUST
(As Amended and Restated Effective As of January 1, 1989)
This Amendment made and entered into as of this 1st day of
October, 1993, by and between Intermet Corporation, a Georgia corporation
(referred to as the "Employer"), and Trust Company Bank, as trustee (referred
to herein as the "Trustee");
W I T N E S S E T H:
WHEREAS, the Employer previously established for the exclusive
benefit of its eligible employees a profit sharing plan and trust known as the
Intermet Corporation Savings and Investment Plan and Trust (the "Plan"); and
WHEREAS, the Plan has been amended from time to time; and
WHEREAS, effective October 1, 1993, the Employer adopted a
special voluntary severance plan for eligible salaried employees of Intermet
Foundries, Inc. and its subsidiaries, known as the 1993 Special Voluntary
Severance Plan for Salaried Employees of Intermet Foundries, Inc. and Its
Subsidiaries (the "1993 Special Voluntary Severance Plan"); and
WHEREAS, because Participants who elect to resign from
employment under the 1993 Special Voluntary Severance Plan will cease
employment with the Employer and active participation under this Plan effective
as of their "Severance Date," as that term is defined in the 1993 Special
Voluntary Severance Plan, the parties desire to amend the Plan to provide
special provisions for
<PAGE> 2
Participants electing to participate in the 1993 Special Voluntary Severance
Plan and to clarify the Plan's provisions relating to severance pay;
NOW, THEREFORE, for and in consideration of the premises and
mutual covenants contained herein, the parties hereto agree as follows:
1.
Section 2.1 is hereby amended by adding the following at the
end of the present section:
"Annual Compensation shall not include any amounts paid to a
Participant or former Participant as severance pay pursuant
to any plan, program or policy of the Employer."
2.
Article III is hereby amended by adding the following new
Section 3.9:
"3.9 Participation in the 1993 Special Voluntary
Severance Plan -
(a) In General - This Section shall apply only to
those Participants who are eligible for, and elect to
participate in, the 1993 Special Voluntary Severance
Plan for Salaried Employees of Intermet Foundries,
Inc. and Its Subsidiaries (the "1993 Special
Voluntary Severance Plan"). The terms "Severance
Date" and "Severance Pay" shall have the meanings
given them under the 1993 Special Voluntary Severance
Plan and such definitions are expressly incorporated
herein by reference. Notwithstanding the provisions
of this Section 3.9, the Employer may restrict the
benefits of any Highly Compensated Employee in order
to satisfy the applicable non-discrimination
requirements of the Code.
(b) Service - Except as otherwise provided in
this Section 3.9, a Participant who elects to
participate in the 1993 Special Voluntary
-2-
<PAGE> 3
Severance Plan shall cease active participation
in this Plan for all purposes effective as of his
Severance Date. Such Participant shall not
be eligible to participate in Pay Transfers,
Matching Contributions, Profit Sharing Contributions
or allocations of Forfeitures pursuant to Sections
4.1, 4.3 and 5.4 of the Plan, respectively, for any
period that such Participant receives Severance Pay.
(c) Matching Contributions - Notwithstanding the
requirement in Section 4.3(a) that a Participant be
an active Employee on the last day of the Calendar
Quarter in order to receive a Matching Contribution
for such Calendar Quarter, if the Participant elects
to participate in the 1993 Special Voluntary
Severance Plan and such Participant is not an active
Employee on the last day of a Calendar Quarter for
which he has made Pay Transfers because the
Participant incurred his Severance Date during such
Calendar Quarter, he shall nevertheless be eligible
to receive a Matching Contribution in accordance with
Section 4.3(a) of the Plan for the Calendar Quarter
during which the Participant's Severance Date occurs.
(d) 1993 Profit Sharing Contributions - For the
Plan year ending December 31, 1993 only (the "1993
Plan Year"), the Employer shall make a one-time
Profit Sharing Contribution pursuant to Section
4.3(c) of the Plan for each Participant who: (i)
elects to participate in the 1993 Special Voluntary
Severance Plan; (ii) has a Severance Date prior to
December 31, 1993; and (iii) has a Year of Service
for the 1993 Plan Year.
(e) Annual Compensation - For purposes of the
Matching Contributions and Profit Sharing
Contributions made under this Section 3.9, Annual
Compensation shall only include a Participant's
Annual Compensation received through the
Participant's Severance Date and shall not include
any Severance Pay.
(f) Early or Normal Retirement - A Participant
who is eligible for, and elects to participate in,
the 1993 Special Voluntary Severance Plan, but who
does not satisfy the requirements of Section 6.1 as
of his Severance Date, shall be granted such
additional age and/or service under this Plan so that
he satisfies the requirements of Section 6.1(a) or
6.1(b) of the Plan as of his Severance
-3-
<PAGE> 4
Date, without regard to the Participant's actual Severance
Date under the 1993 Special Voluntary Severance Plan."
3.
The provisions of this Amendment No. 2 shall be effective as of October
1, 1993.
4.
Except as hereby modified, the Plan shall remain in full force
and effect.
IN WITNESS WHEREOF, the parties have caused this Amendment No.
2 to be duly executed as of the day and the year first above written.
EMPLOYER:
INTERMET CORPORATION
By: /s/ John Ernst
---------------------------
Title: V.P. Finance
------------------------
TRUSTEE:
TRUST COMPANY BANK
By: /s/
---------------------------
Title: Vice President
------------------------
-4-
<PAGE> 1
Exhibit 11
Intermet Corporation
Computation of Earnings Per Common Share
<TABLE>
<CAPTION>
1993 1992 1991
----------------------------------------------------
<S> <C> <C> <C>
Net income (loss) $(20,504,000) $(29,936,000) $ 8,803,000
====================================================
Weighted average number of shares
outstanding 24,563,849 22,614,822 20,919,255
Add dilutive effect of outstanding
warrants and options - 168,073 32,209
----------------------------------------------------
Weighted average number of shares and
equivalent shares
outstanding 24,563,849 22,782,895 20,951,464
====================================================
Earnings (loss) per share $ (.83) $ (1.31) $ .42
====================================================
</TABLE>
<PAGE> 1
EXHIBIT 13
DISCUSSION OF FINANCIAL INFORMATION
Results of Operations
1993 Compared to 1992
Net sales in 1993 rose $42.3 million over 1992. This growth was the result of
an increase in shipments to the Company's U.S. automotive customers of almost
20%, approximately one-third of which related to a major new order from Ford
which was only in production for part of 1992. Partially offsetting this
growth was a 20% drop in shipments from the Company's German foundry due to the
recession in Europe. Sales in the U.S. are expected to continue improving in
1994, but the rate of improvement will be lower than in 1993. Sales in Europe
are expected to remain weak throughout 1994.
Gross profit fell $4.8 million in 1993 despite the higher sales, reducing the
consolidated gross margin to 8% of sales from 10% in 1992. Losses at the
Ironton, Ohio foundry were one reason for the lower gross profit. These losses
were the result of continuing startup costs and manufacturing problems related
to the additions of both a new production line for the Ford order noted above
and a second shift on the existing production line at that plant in the last
half of 1992. The workload also became unbalanced among certain plants when
U.S. sales surged in the first half of 1993. This led to inefficient
utilization of the Company's domestic foundry capacity. In addition, profits
and margins fell at the German foundry as a result of the sharp decline in
sales from that plant. Offsetting these factors was a significant improvement
in the operating results of the Columbus, Georgia foundry after replacement of
the molding lines there was completed in early 1993.
Operating expenses were relatively unchanged in 1993 compared to 1992 and, as a
result, fell as a percent of sales from 8.5% to 7.8%. Operating expenses
should remain at their current level for 1994 as well.
The Company reported an operating loss of $23.5 million in 1993. In 1992 the
Company had an operating profit of $5.8 million. While the factors noted above
contributed to the loss, the principal reason for the loss was a $24 million
restructuring charge. This charge was primarily related to the Company's
decision to close the Lower Basin foundry in Virginia. A number of factors led
to this decision, including the amount of capital expenditures required at the
plant in the next few years, its location in a flood plain and the uncertain
outlook for profitable operations. The foundry had stopped pouring iron by the
end of 1993 and will close completely during 1994. The restructuring charge
included provisions for severance pay and employee benefits for Lower Basin and
certain other employees who supported the plant's operation, write-down of
assets, operating losses until closing and other costs expected to be incurred
as a result of this decision. Management expects this decision to pay
<PAGE> 2
for itself within three years through improved operations and lower overhead.
Operating results are expected to improve significantly in 1994 over 1993, even
after ignoring the effect of the restructuring charge on 1993 results. This
expectation is based on continued growth in the U.S. market, better and more
efficient utilization of remaining capacity and price increases obtained or
expected to be obtained on certain products.
Net interest expense for 1993 increased $1.4 million over the prior year, due
largely to higher borrowing levels used to fund capital expenditures. The
effect of higher borrowing levels was offset in part by capitalized interest of
approximately $1 million related to the expansion of the New River foundry in
Virginia.
The Company recorded an income tax benefit of $8.5 million on a pretax loss of
$29.1 million in 1993. Deferred tax assets increased $14 million during the
year to more than $50 million. While management believes most of these
deferred tax assets will eventually be realized, valuation allowances have been
established for a substantial portion of these assets given the available
objective evidence required under generally accepted accounting principles.
Management did not believe it was necessary to fully reserve all of the 1993
increase because it believes it is more likely than not that sufficient pretax
income (approximately $25 million) can be generated through future profitable
operations or tax planning strategies. The 1993 income tax benefit was also
affected by a decrease in the German tax rate.
The Company adopted Statements of Financial Accounting Standards No. 106 and
109 in 1992. These statements changed the methods of accounting for
postretirement benefits and income taxes, and their adoption resulted in a net
charge against 1992 results of $28.4 million for the cumulative effect on prior
years. Such adoption also caused postretirement benefit expense to increase by
$2.4 million and $1.6 million in 1993 and 1992, respectively.
1992 Compared to 1991
Net sales in 1992 climbed $82.2 million over 1991. Over $26 million of this
rise was due to the acquisition of PBM Industries and InterMotive Technologies
at the end of March 1992. Another $38 million was the result of an increase in
sales by the Company's U.S. foundry group. Sales at the Company's German
foundry grew over $15 million, approximately $4 million of which was due to a
change in the average exchange rate between 1991 and 1992. The growth in sales
at the Company's foundries was due to an increase in tons shipped, primarily
for existing orders with current customers. Approximately one-fourth of the
increase in sales of the U.S. foundry group was related to a major new order
from Ford.
<PAGE> 3
Gross profit rose $3.7 million in 1992 compared to 1991, although it fell as a
percent of sales to 10% from 11.4%. The consolidated gross margin suffered
primarily for three reasons. First, the changes previously noted at the
Ironton plant caused significant startup costs in the second half of the year.
Second, the acquisition of PBM had a minimal effect on gross profit relative to
its effect on sales, thereby diluting the consolidated gross margin. Finally,
the change in accounting for postretirement benefits reduced gross profit
approximately $1.6 million effective January 1, 1992.
Operating expenses rose $5.4 million in 1992 over the prior year, almost $2
million of which was related to the addition of PBM. Other factors
contributing to this rise were costs associated with the Company's recent
pursuit of the aluminum castings market and increased costs at the U.S. foundry
group. The increase in costs at the U.S. foundry group reflects increasing
demands from customers for support services and effects of the Company's
capital expenditure program. As a percent of sales, operating expenses fell
from 9% for 1991 to 8.5% for 1992.
Net interest expense increased from $3.1 million in 1991 to $4.1 million in
1992. Interest income fell as U.S. interest rates dropped and average cash
balances declined. Interest expense was up slightly as the effect of increased
borrowing levels was largely offset by the effect of lower interest rates in
the U.S. The decline in cash balances and increase in borrowing levels were
due to the Company's capital expenditure program discussed further below.
The Company recorded an income tax provision of $4.3 million on pretax income
of $2.3 million in 1992. This compares to an income tax provision of $3.1
million on pretax income of $11.9 million in 1991. The effective rate was high
in 1992 primarily because the German foundry, which was taxed at rates over
50%, generated a pretax profit while the combined U.S. operations, which were
taxed at much lower rates, produced a net pretax loss. Also, the additional
postretirement benefit expense accrued in 1992 was recorded without a related
tax benefit. The 1991 rate was unusually low because the gain from sale of a
subsidiary actually generated a capital loss for tax purposes. This in turn
led to a reduction of the 1991 income tax provision.
Liquidity and Capital Resources
The Company's financial position weakened during 1993 due to the net loss and
increased borrowings to fund capital expenditures. Certain balance sheet data
is summarized below:
<PAGE> 4
December 31
1992 1993
- --------------------------------------------------------------
Funded debt $ 76,751,000 $106,593,000
Shareholders' equity 101,054,000 75,532,000
Net working capital 30,406,000 39,631,000
The significant increase in borrowings during 1993 was primarily used to fund
capital expenditures and an increase in working capital. The major capital
expenditure program begun two years ago is almost completed. The last project,
the addition of a new molding line at the New River foundry, is expected to
begin operating during the second quarter of 1994. Capital expenditures are
expected to be at or below the level of depreciation in 1994.
The net loss led to a significant decrease in shareholders' equity. Much of
the net loss was due to the $24 million restructuring charge accrued in 1993,
most of which has yet to require the use of funds. The Company expects to
spend approximately $4 million in each of 1993, 1994 and 1995 from cash
provided by operations to fund items accrued as part of the restructuring. At
least $6 million of the restructuring charge represents noncash charges which
will not result in a cash outflow. Most of the remaining amount will probably
not require funding for several years.
At December 31, 1993 the Company and its subsidiaries had approximately $19
million of unused borrowing capacity under various credit agreements, and an
additional $16 million available if certain financial ratios are maintained.
Management believe cash from operations and the availability of unused
borrowing capacity will be sufficient to fund 1994 working capital needs and
expected capital expenditures.
The Environmental Protection Agency ("EPA") filed a complaint against one of
the Company's subsidiaries in August 1991. The complaint alleged various
violations, the most significant of which related to the treatment of certain
hazardous wastes at two foundries. The complaint demanded a penalty of
approximately $1,500,000. Certain provisions were made in 1991 for the EPA
penalty demand, for remediation costs at the two sites in question and for
other environmental matters. The Company and the EPA reached an agreement in
principle during 1993 for a reduced penalty of $330,000.
The Company has entered into negotiations with the Ohio Attorney General's
office concerning past violations of Ohio water pollution laws and regulations
at the Ironton foundry. In March 1994 the Attorney General's office advised
the Company it could avoid litigation with respect to these violations by
entering into a consent order. The Company will fully respond to the Attorney
General by mid-April and expects to enter into a consent order providing for
monetary penalties. Management does not expect
<PAGE> 5
this mattter to have a material adverse effect on the Company's operations or
consolidated financial position.
The Company also incurs recurring costs to manage and dispose of waste
(principally nonhazardous waste) generated as part of ongoing operations. In
1993 such costs totaled approximately $10 million. Although the Company
continues to take various steps to control these costs, they are expected to
increase in the future. In addition, a portion of the Company's capital
expenditures are regularly incurred to limit or monitor pollution, principally
for ventilation and dust control equipment. It is difficult to estimate such
expenditures, but management believes they generally have been and will
continue to be less than 30% of total capital expenditures.
<PAGE> 6
Five Year Financial Review
<TABLE>
<CAPTION>
Years Ended December 31 1989 1990 1991 1992 1993
=================================================================================================================
Statement of Operations Data (in thousands)
<S> <C> <C> <C> <C> <C>
Net sales $397,122 $386,318 $319,784 $401,951 $444,214
Restructuring Charge -- 12,500 -- -- 24,000
Operating profit (loss) 28,390 1,034 7,563 5,830 (23,486)
Income (loss) before cumulative effect of
accounting changes 14,530 (10,389) 8,803 (1,515) (20,504)
Cumulative effect on prior years of
changes in accounting methods -- -- -- (28,421) --
Net income (loss) 14,530 (10,389) 8,803 (29,936) (20,504)
=================================================================================================================
Share Data
Earnings (loss) per share before
cumulative effect of accounting changes $0.68 ($0.55) $0.42 ($0.06) ($0.83)
Earnings (loss) per share 0.68 (0.55) 0.42 (1.31) (0.83)
Cash dividends per share 0.20 0.20 0.14 0.16 0.12
=================================================================================================================
Balance Sheet Data (in thousands)
Total assets $277,458 $214,875 $214,207 $274,457 $307,458
Debt due after one year 74,776 45,138 32,906 69,478 101,861
Shareholders' equity 113,833 103,591 105,407 101,054 75,532
</TABLE>
<PAGE> 7
Report of Independent Auditors
The Board of Directors and Shareholders
Intermet Corporation
We have audited the accompanying consolidated balance sheets of Intermet
Corporation as of December 31, 1993 and 1992, and the related consolidated
statements of operations, shareholders' equity and cash flows for each of the
three years in the period ended December 31, 1993. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Intermet
Corporation at December 31, 1993 and 1992, and the consolidated results of its
operations and its cash flows for each of the three years in the period ended
December 31, 1993, in conformity with generally accepted accounting principles.
As discussed in Notes 9 and 10 to the consolidated financial statements, in
1992 the Company changed its methods of accounting for postretirement benefits
other than pensions and income taxes.
/s/ Ernst & Young
Atlanta, Georgia
February 9, 1994
<PAGE> 8
Intermet Corporation
Consolidated Balance Sheets
<TABLE>
<CAPTION>
DECEMBER 31
1993 1992
-----------------------------
(In Thousands of Dollars)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 11,240 $ 6,097
Accounts receivable:
Trade, less allowance for doubtful accounts of
$518 in 1993 and $367 in 1992 47,440 39,748
Other 5,502 4,929
-----------------------------
52,942 44,677
Inventories:
Finished goods 6,316 5,673
Work in process 7,154 4,184
Raw materials 5,345 6,050
Supplies and patterns 18,417 19,080
-----------------------------
37,232 34,987
Income taxes 5,629 -
Other current assets 1,586 3,504
-----------------------------
Total current assets 108,629 89,265
Property, plant and equipment, at cost:
Land 3,520 3,535
Buildings and improvements 62,669 64,148
Machinery and equipment 218,733 218,637
Construction in progress 43,743 22,661
-----------------------------
328,665 308,981
Less:
Foreign industrial development grants, net of
amortization 5,275 6,118
Accumulated depreciation and amortization 150,093 139,638
-----------------------------
Net property, plant and equipment 173,297 163,225
Other assets 19,634 21,967
Deferred income taxes 5,898 -
-----------------------------
$ 307,458 $ 274,457
=============================
</TABLE>
<PAGE> 9
<TABLE>
<CAPTION>
DECEMBER 31
1993 1992
-----------------------------
(In Thousands of Dollars)
<S> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 34,784 $ 29,372
Income taxes - 820
Accrued wages and benefits 13,092 12,873
Accrued restructuring costs 7,316 -
Other accrued liabilities 9,074 8,521
Long-term debt due within one year 4,732 7,273
-----------------------------
Total current liabilities 68,998 58,859
Noncurrent liabilities:
Long-term debt due after one year 101,861 69,478
Deferred income taxes 4,482 947
Retirement benefits 45,624 41,163
Other noncurrent liabilities 8,124 -
-----------------------------
Total noncurrent liabilities 160,091 111,588
Minority interests 2,837 2,956
Shareholders' equity:
Preferred stock; 5,000,000 shares
authorized; none issued - -
Common stock, $.10 par value;
50,000,000 shares authorized; 24,572,219 and
24,534,349 shares issued in 1993 and 1992,
respectively 2,457 2,453
Capital in excess of par value 51,742 51,473
Retained earnings 22,715 46,166
Accumulated translation adjustments 1,499 2,636
Minimum pension liability adjustment (2,881) (1,674)
-----------------------------
Total shareholders' equity 75,532 101,054
-----------------------------
$ 307,458 $ 274,457
=============================
See accompanying notes.
</TABLE>
<PAGE> 10
Intermet Corporation
Consolidated Statements of Operations
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
1993 1992 1991
-------------------------------------------------
(In Thousands of Dollars, Except Per Share Data)
<S> <C> <C> <C>
Net sales $444,214 $401,951 $319,784
Cost of sales 408,835 361,807 283,355
-------------------------------------------------
Gross profit 35,379 40,144 36,429
Operating expenses:
Selling 6,114 6,684 5,510
General and administrative 28,751 27,630 23,356
Restructuring charge (Note 3) 24,000 - -
-------------------------------------------------
Operating profit (loss) (23,486) 5,830 7,563
Other income and expenses:
Interest income 135 289 1,153
Interest expense (5,625) (4,343) (4,253)
Other, net (Note 3) (159) 531 7,397
-------------------------------------------------
(5,649) (3,523) 4,297
-------------------------------------------------
Income (loss) before income taxes, minority
interest and cumulative effect of accounting
changes (29,135) 2,307 11,860
Provision (benefit) for income taxes (8,512) 4,310 3,078
-------------------------------------------------
Income (loss) before minority interest and
cumulative effect of accounting changes (20,623) (2,003) 8,782
Minority interest in loss of subsidiaries 119 488 21
-------------------------------------------------
Income (loss) before cumulative effect of
accounting changes (20,504) (1,515) 8,803
Cumulative effect on prior years of changes in
accounting for:
Postretirement benefits - (34,544) -
Income taxes - 6,123 -
-------------------------------------------------
Net income (loss) $(20,504) $(29,936) $ 8,803
=================================================
Amounts per common share:
Income (loss) before cumulative effect of
accounting changes $ (.83) $ (.06) $ .42
Cumulative effect on prior years of changes in
accounting for:
Postretirement benefits - (1.52) -
Income taxes - .27 -
-------------------------------------------------
Net income (loss) $ (.83) $ (1.31) $ .42
=================================================
See accompanying notes.
</TABLE>
<PAGE> 11
Intermet Corporation
Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
1993 1992 1991
-------------------------------------------------
(In Thousands of Dollars, Except Per Share Data)
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net income (loss) $(20,504) $(29,936) $ 8,803
Adjustments to reconcile net income
(loss) to cash provided by operating
activities:
Depreciation and amortization 26,583 22,996 19,731
Restructuring charge 24,000 - -
Cumulative effect of accounting
changes - 28,421 -
Loss on sale of assets 1,053 891 458
Gain on sale of subsidiary - - (7,266)
Deferred income taxes (4,640) (853) (1,619)
Minority interest in loss of
subsidiaries (119) (488) (21)
Changes in operating assets and
liabilities excluding the effects of
acquisitions:
Accounts receivable (9,221) (3,262) 3,874
Inventories (4,929) (5,423) 2,016
Accounts payable and accrued
liabilities 5,358 (1,609) (2,806)
Other assets and liabilities 183 (933) (1,429)
-------------------------------------------------
Cash provided by operating activities 17,764 9,804 21,741
INVESTING ACTIVITIES
Additions to property, plant and
equipment (41,018) (51,783) (24,813)
Cost of acquisitions - (6,750) -
Proceeds from sale of assets 1,012 220 2,901
Proceeds from sale of subsidiary - - 11,852
Other, net (877) (1,478) 317
-------------------------------------------------
Cash used in investing activities (40,883) (59,791) (9,743)
</TABLE>
<PAGE> 12
Intermet Corporation
Consolidated Statements of Cash Flows (continued)
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
1993 1992 1991
-------------------------------------------------
(In Thousands of Dollars, Except Per Share Data)
<S> <C> <C> <C>
FINANCING ACTIVITIES
Increase in debt 35,579 51,835 6,094
Reduction in debt (4,482) (31,248) (10,473)
Issuance of common stock 273 31,399 -
Repurchase of common stock - - (3,474)
Dividends paid (2,947) (3,634) (2,925)
Other, net (140) (407) -
-------------------------------------------------
Cash provided by (used in) financing
activities 28,283 47,945 (10,778)
Effect of exchange rate changes on cash (21) (367) 15
-------------------------------------------------
Net increase (decrease) in cash and cash
equivalents 5,143 (2,409) 1,235
Cash and cash equivalents at beginning of
year 6,097 8,506 7,271
-------------------------------------------------
Cash and cash equivalents at end of year $ 11,240 $ 6,097 $ 8,506
=================================================
See accompanying notes.
</TABLE>
<PAGE> 13
Intermet Corporation
Consolidated Statements of Shareholders' Equity
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
1993 1992 1991
--------------------------------------------------
(In Thousands of Dollars, Except Per Share Data)
<S> <C> <C> <C>
Common stock:
Beginning balance $ 2,453 $ 2,089 $ 2,142
Issuance of 3,639,750 shares of common stock - 364 -
Exercise of options to purchase 45,000 shares of
common stock 4 - -
Repurchase and retirement of 529,369 shares of
common stock - - (53)
--------------------------------------------------
Ending balance 2,457 2,453 2,089
Capital in excess of par value:
Beginning balance 51,473 20,438 23,859
Issuance of 3,639,750 shares of common stock - 31,035 -
Exercise of options to purchase 45,000 shares of
common stock 269 - -
Repurchase and retirement of 529,369 shares of
common stock - - (3,421)
--------------------------------------------------
Ending balance 51,742 51,473 20,438
Retained earnings:
Beginning balance 46,166 79,736 73,858
Net income (loss) (20,504) (29,936) 8,803
Cash dividends ($.12 per share in 1993, $.16 per
share in 1992 and $.14 per share in 1991) (2,947) (3,634) (2,925)
--------------------------------------------------
Ending balance 22,715 46,166 79,736
Accumulated translation adjustments:
Beginning balance 2,636 3,144 3,732
Translation adjustments (1,137) (508) (588)
--------------------------------------------------
Ending balance 1,499 2,636 3,144
Minimum pension liability adjustment:
Beginning balance (1,674) - -
Adjustment (1,207) (1,674) -
--------------------------------------------------
Ending balance (2,881) (1,674) -
--------------------------------------------------
Total shareholders' equity $ 75,532 $101,054 $105,407
==================================================
See accompanying notes.
</TABLE>
<PAGE> 14
Intermet Corporation
Notes to Consolidated Financial Statements
December 31, 1993, 1992, and 1991
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The accompanying consolidated financial statements include the accounts of
Intermet Corporation ("Intermet") and its subsidiaries (collectively, the
"Company"). All significant intercompany transactions and balances have been
eliminated in consolidation.
INVENTORIES
Inventories are stated at the lower of cost or market. Cost is determined on
the last-in, first-out (LIFO) method as to 24% and 15% of the December 31, 1993
and 1992 inventories, respectively. For other inventories, raw materials and
supplies are valued on a weighted average cost basis, while average production
cost is used for work in process and finished goods valuation. The specific
identification method is used for patterns. If LIFO inventories were valued
using the same cost methods used for other inventories, their carrying values
would have increased by $1,042,000 and $835,000 at December 31, 1993 and 1992,
respectively.
PROPERTY, PLANT AND EQUIPMENT
The provision for depreciation and amortization of property, plant and
equipment is determined on the basis of estimated useful lives using the
straight-line method. Certain industrial development grants provided by the
Federal and state governments of Germany are included as reductions of
property, plant and equipment and are being amortized over the period the
related assets are being depreciated.
INTANGIBLE ASSETS
Intangible assets consist principally of costs in excess of net assets acquired
which are being amortized using the straight-line method over periods from ten
to forty years.
<PAGE> 15
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
NET INCOME (LOSS) PER COMMON SHARE
Net income (loss) per common share amounts are based on the weighted average
number of shares outstanding during the period, after giving effect to the
exercise of options (see Note 7) and assuming the repurchase, at fair market
value, of shares using the proceeds from such exercise, unless the effect is
antidilutive.
2. ACQUISITIONS
In March 1992 the Company's wholly owned domestic subsidiary, Intermet
Machining, Inc. ("IMI"), acquired all of the common and preferred stock of PBM
Industries, Inc. ("PBM"). IMI also acquired all of the outstanding preferred
stock of Batten Design and Engineering Services, Inc. ("Batten"). PBM owned
80% of the common stock of Batten at that time. The purchase price for all of
the shares totaled $3,750,000 and was funded by a cash payment of $850,000 and
debt of IMI totaling $2,900,000. In addition, IMI made a cash investment of
$1,900,000 into PBM which was used to repay certain long-term debt of PBM.
In August 1992 the Company purchased Ford Motor Company's 40% minority interest
in the common stock of New River Castings Company ("New River"), making New
River a wholly owned subsidiary of the Company. The purchase price of
$4,500,000 comprised a cash payment of $4,000,000 and preferred stock of New
River with a par value of $500,000. The preferred shares are included in
minority interests in the consolidated balance sheet.
Both of the foregoing transactions have been accounted for as purchases. The
consolidated financial statements include the results of operations of PBM and
Batten (now called InterMotive Technologies, Inc.) since their date of
acquisition. The accounts of New River were already included in the
consolidated financial statements by virtue of the Company's 60% ownership
interest. The following represents the (unaudited) pro forma consolidated
results of operations of the Company for the years ended December 31, 1992 and
1991, assuming both acquisitions had occurred on January 1, 1992 (for 1992
amounts) and 1991 (for 1991 amounts) (in thousands of dollars, except for per
share data):
<PAGE> 16
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
2. ACQUISITIONS (CONTINUED)
<TABLE>
<CAPTION>
1992 1991
-----------------------------
<S> <C> <C>
Net sales $411,579 $357,818
Net income (loss) (30,412) 7,304
Net income (loss) per common share (1.33) .35
</TABLE>
These pro forma results are presented for comparative purposes only. They are
not necessarily indicative of what would have occurred had the acquisitions
actually been made at the beginning of the respective periods, or of future
results of operations.
3. RESTRUCTURING ACTIVITIES
In August 1993 the Company decided to close its oldest plant, the Lower Basin
foundry in Virginia. A number of factors led to this decision, including the
amount of capital expenditures required at the plant in the next few years, its
location in a flood plain and the uncertain outlook for profitable operations.
The decision to close this foundry was the principal reason for recording a
$24,000,000 restructuring charge in the third quarter of 1993. The charge
included provisions for severance pay and employee benefits of $8,000,000,
write-down of capital assets and inventories of $6,000,000, provisions for
operating losses until closing of $4,500,000 and other costs expected to be
incurred of $5,500,000.
In February 1991 the Company sold its 60% interest in INTAT Precision, Inc., a
foundry company in Indiana. The sale proceeds totaled $11,852,000, resulting
in a net gain of $7,266,000. This amount is included in other income in the
consolidated statement of operations.
4. JOINT VENTURES AND MINORITY INTERESTS
The Company and an Australian company have, through subsidiaries, formed a
joint venture, ICA Castings ("ICA"). ICA has constructed a pilot casting line
in Kentucky for the manufacture of aluminum automotive castings. The Company
accounts for its 50% interest in ICA under the equity method.
<PAGE> 17
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
4. JOINT VENTURES AND MINORITY INTERESTS (CONTINUED)
The Company also had a joint venture with a Korean company. The joint venture
owned and operated an iron foundry in Korea. The Company sold its 20% interest
in the joint venture during 1993. This investment and the effects of its sale
were not material to the Company's consolidated financial position or results
of operations.
In 1988 the Company purchased all of the common stock of Ironton Iron, Inc.
("Ironton"), a foundry company in Ohio. As a part of the transaction, the
previous common stockholders of Ironton received an equivalent number of shares
of Ironton's new 5% cumulative preferred stock with an aggregate par value of
$2,337,000. The preferred shares are to be retired at par value from net
income of Ironton, if available. No shares have been retired and no dividends
have been paid to date since Ironton has incurred a cumulative net loss since
1988. The preferred shares are included in minority interests in the
consolidated balance sheet.
5. CASH FLOW INFORMATION
All short-term investments with original maturities of less than 90 days are
deemed to be cash equivalents for purposes of the statements of cash flows.
There were no non-cash investing and financing activities in 1993 or 1991.
Such activities in 1992 were as follows (in thousands of dollars):
<TABLE>
<S> <C>
Fair value of assets acquired $ 15,073
Costs in excess of net assets acquired 10,822
Less:
Liabilities and funded debt assumed (18,512)
Minority interest in Batten (133)
Preferred stock of New River (500)
---------------
Net cash paid for acquisitions $ 6,750
===============
</TABLE>
<PAGE> 18
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
6. LONG-TERM DEBT AND REVOLVING CREDIT
Long-term debt and revolving credit loans consist of the following (in
thousands of dollars):
<TABLE>
<CAPTION>
1993 1992
-----------------------------
<S> <C> <C>
Intermet:
Term loan with insurance company (a) $ 25,000 $ 25,000
Revolving credit bank loan (b) 54,624 19,969
Bank lines of credit (c) 8,470 9,625
Subsidiaries:
Lynchburg revenue bonds (d) 6,970 7,565
Neunkirchen bank loans (e) 2,269 5,695
Neunkirchen term notes (f) 6,536 5,767
IMI promissory notes (g) 2,724 2,754
Other - 376
-----------------------------
Total 106,593 76,751
Less debt due within one year 4,732 7,273
-----------------------------
Debt due after one year $101,861 $ 69,478
=============================
(a) In December 1992 the Company entered into a term loan agreement
with The Prudential Insurance Company of America. The loan bears
interest at a base rate plus an additional lender margin in
certain circumstances, with interest payable in quarterly
installments. The interest rate at December 31, 1993 was 9.05%.
Principal amounts are to be repaid in five equal annual
installments beginning in December 1998. The term loan agreement
requires the Company to maintain certain financial ratios and
imposes limitations on dividends and certain activities of the
Company.
<PAGE> 19
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
6. LONG-TERM DEBT AND REVOLVING CREDIT (CONTINUED)
(b) In August 1992 the Company entered into a revolving credit
agreement with a bank consortium. The agreement provides for
loans up to $75,000,000 and DM 8,000,000 (approximately
$4,624,000). Interest rates on both the U.S. dollar and deutsche
mark facilities are based on various market rates, and in most
cases include additional lender margins. The weighted average
interest on borrowings at December 31, 1993 was 5.3%. The
Company also must pay a fee of 0.375% on any unused portion of
the loan commitment. The balances outstanding in August 1995 may
be converted to term loans payable in sixteen quarterly principal
installments bearing interest at the prevailing market rates at
that time. The revolving credit agreement requires the Company
to maintain certain financial ratios and imposes limitations on
dividends and certain activities.
(c) In August 1992 the Company entered into uncommitted line of
credit agreements with two banks. The agreements provide for
loans up to $12,000,000 bearing interest at the prime rate or
other specified rates. The weighted average interest rate on
borrowings at December 31, 1993 was 4.5%. The availability of
these lines are at the discretion of the banks and borrowings are
payable on demand. The borrowings are classified as long-term
since the Company has the intent and ability to refinance them
under the revolving credit facility described in (b) above.
(d) Lynchburg Foundry Company ("Lynchburg"), a wholly-owned
subsidiary of the Company, issued $4,400,000 of 6 1/4% Pollution
Control Revenue Bonds Series 1973 maturing in December 1998 and
$4,800,000 of 7% Industrial Revenue Bonds maturing in June 2006.
Bonds in the aggregate amount of $4,750,000 are subject to
mandatory redemption prior to maturity in annual amounts ranging
from $175,000 to $705,000 in 1994 through 2005. The bonds are
also subject to optional redemption prior to maturity. Intermet
has agreed to indemnify Lynchburg's former owner for any
liability that may be incurred with respect to its guarantee of
the bonds.
<PAGE> 20
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
6. LONG-TERM DEBT AND REVOLVING CREDIT (CONTINUED)
(e) The Company's German subsidiary, Columbus Neunkirchen Foundry
GmbH ("Neunkirchen"), has various revolving credit agreements in
place which permit borrowings up to DM 25,000,000. The revolving
credit agreement described in (b) above limits such borrowings to
DM 15,000,000 (approximately $8,670,000). The revolving credit
lines bear interest at current market rates (8.75% at December
31, 1993).
(f) The term notes bear interest at rates ranging from 5% to 10.5%
and mature at various times through March 2003. Borrowings
totaling $4,802,000 are secured by property, plant and equipment
with net book values aggregating $29,073,000 at December 31,
1993.
(g) IMI issued various promissory notes totaling $2,900,000 to the
selling shareholders of PBM and Batten (see Note 2). The notes
bear interest at 7% for the first year, 7.5% for the second year
and 8% thereafter. Principal on the notes is payable in three
annual installments beginning in March 1994. The principal
amounts are subject to adjustment for the outcome of certain
contingencies. The amounts outstanding at December 31, 1993 and
1992 reflect adjustments for certain such items.
</TABLE>
Maturities of long-term debt at December 31, 1993 are as follows (in thousands
of dollars):
<TABLE>
<S> <C>
1994 $ 4,732
1995 8,074
1996 18,194
1997 17,316
1998 22,356
Thereafter 35,921
-------------
$106,593
=============
</TABLE>
<PAGE> 21
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
6. LONG-TERM DEBT AND REVOLVING CREDIT (CONTINUED)
The amount reported in the consolidated balance sheets for long-term debt
approximates the fair value of the obligations.
Interest paid totaled $6,654,000, $4,385,000 and $4,392,000 in 1993, 1992 and
1991, respectively. Interest of $1,032,000, $168,000 and $150,000 was
capitalized in 1993, 1992 and 1991, respectively.
The Company is in compliance with the terms and restrictions of its various
loan and credit agreements. At December 31, 1993, all of the Company's
retained earnings were restricted and unavailable for the payment of dividends
under these agreements.
7. SHAREHOLDERS' EQUITY
The Company has a Key Individual Stock Option Plan ("Individual Plan") and a
Directors Stock Option Plan ("Directors Plan") which provide for the issuance
of up to 1,440,000 and 100,000 shares, respectively, of the Company's unissued
common stock. Information regarding the Plans is as follows:
<TABLE>
<CAPTION>
PRICE PER NUMBER OF
SHARE SHARES
--------------------------------
<S> <C> <C>
Outstanding at December 31, 1990 $ 7.25-12.62 338,000
Granted 5.69-6.26 258,000
Canceled 7.25-8.87 (54,000)
------------
Outstanding at December 31, 1991 5.69-12.62 542,000
Granted 7.25-11.55 288,000
Canceled 5.69-8.87 (38,000)
------------
Outstanding at December 31, 1992 5.69-12.62 792,000
Granted 10.75-11.83 304,000
Exercised 5.69-8.87 (43,000)
Canceled or expired 5.69-10.75 (82,000)
------------
Outstanding at December 31, 1993 5.69-12.62 971,000
============
</TABLE>
<PAGE> 22
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
7. SHAREHOLDERS' EQUITY (CONTINUED)
In addition to the above, options for 12,000 shares were outstanding at
December 31, 1993 and options for 2,000 shares were exercised in 1993, all at a
price of $8.87. Options for 388,000 shares, which includes all options granted
to directors, are currently exercisable. The remaining options outstanding
under the Individual Plan will become exercisable in increments in the future.
The Company has an Employee Stock Ownership Plan ("Plan") for certain of its
United States employees who are not covered by collective bargaining
agreements. The Plan requires contributions by the Company equal to 3% of the
annual compensation of the Plan participants. The Company may, at its
discretion, make additional contributions within specified limits.
Contributions to the Plan of $786,000, $744,000 and $650,000 were accrued in
1993, 1992 and 1991, respectively.
8. COMMITMENTS AND CONTINGENCIES
Future minimum rental payments required under building and equipment operating
leases that have initial or remaining noncancelable lease terms in excess of
one year at December 31, 1993 are as follows (in thousands of dollars):
<TABLE>
<S> <C>
1994 $ 2,559
1995 2,205
1996 1,881
1997 1,841
1998 1,518
Thereafter 2,401
-------------
$ 12,405
=============
</TABLE>
Total rental expense under operating leases was $2,847,000, $2,562,000 and
$1,852,000 in 1993, 1992 and 1991, respectively.
At December 31, 1993 the Company had commitments for the purchase of equipment
totaling approximately $7,225,000.
<PAGE> 23
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
8. COMMITMENTS AND CONTINGENCIES (CONTINUED)
The Environmental Protection Agency ("EPA") filed a complaint against a
subsidiary of the Company in August 1991. The complaint alleged various
violations, the most significant of which related to the treatment of certain
hazardous waste at two foundries. The complaint demanded a penalty of
approximately $1,500,000. Certain provisions were made in 1991 for the EPA
penalty demand, for remediation costs at the two sites in question and for
other environmental matters. The Company and the EPA reached an agreement in
principle during 1993 for a reduced penalty of $330,000.
The Company is also engaged in various legal proceedings and other matters
incidental to its normal business activities. The Company does not believe any
of these proceedings or matters are material in relation to the Company's
consolidated financial position or results of operations.
9. RETIREMENT PLANS AND BENEFITS
The Company maintains several noncontributory defined benefit pension plans for
certain of its employees covered by collective bargaining agreements. The
benefits are based on years of service. The Company's policy is to fund
amounts as required under applicable laws and regulations.
Net pension expense included the following components (in thousands of
dollars):
<TABLE>
<CAPTION>
1993 1992 1991
------------------------------------
<S> <C> <C> <C>
Service cost (benefits earned) $ 917 $ 955 $ 806
Interest cost on projected benefit
obligations 1,253 1,112 950
Return on plan assets (1,227) (1,313) (1,542)
Net amortization and deferral 598 843 1,251
------------------------------------
$ 1,541 $ 1,597 $ 1,465
====================================
</TABLE>
<PAGE> 24
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
9. RETIREMENT PLANS AND BENEFITS (CONTINUED)
The reconciliation of the U.S. plans' funded status to the amounts reported in
the Company's consolidated balance sheets at December 31, 1993 and 1992 is as
follows (in thousands of dollars):
<TABLE>
<CAPTION>
1993 1992
-------------------------
<S> <C> <C>
Actuarial present value of accumulated benefit
obligations:
Vested $20,934 $14,577
Nonvested 1,329 2,215
-------------------------
Total accumulated benefit obligations $22,263 $16,792
=========================
Projected benefit obligations $22,263 $16,792
Plan assets at fair value 13,166 11,482
-------------------------
Excess of projected benefit obligations
over assets
9,097 5,310
Unrecognized prior service cost (674) (1,459)
Unrecognized net actuarial loss (4,723) (2,697)
Unrecognized transition obligation (433) (856)
Additional minimum liability 5,831 5,015
-------------------------
Pension liabilities included in consolidated
balance sheets $ 9,098 $ 5,313
=========================
</TABLE>
The above pension liabilities include $8,410,000 and $5,015,000 shown in
noncurrent liabilities in the Company's consolidated balance sheets at December
31, 1993 and 1992, respectively. The decision to close the Lower Basin foundry
(see Note 3) increased the pension liability by $2,579,000.
The discount rate used in determining the actuarial present value of the
projected benefit obligations was 6.75% in 1993 and 7.5% in 1992. The expected
long-term rate of return on assets used in determining net pension expense was
9% in 1993, 1992 and 1991. Plan assets consist of publicly traded stocks and
bonds, cash equivalents and insurance contracts.
<PAGE> 25
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
9. RETIREMENT PLANS AND BENEFITS (CONTINUED)
The Company maintains several defined contribution plans for certain hourly
employees. Contributions to these plans are accrued based on hours worked by
each employee, and totaled $520,000, $339,000 and $139,000 in 1993, 1992 and
1991, respectively. Some of the plans allow participants to make
contributions, on a pretax basis, of up to 20% of their compensation.
The Company also maintains a defined contribution plan for domestic salaried
employees. The Company contributes a specified percentage of the annual
compensation of participants. Participants are also allowed to make
contributions to the plan, on a pretax basis, of up to 10% of their
compensation. The Company matches 50% of participant contributions, up to a
specified limit. The Company accrued contributions to the plan of $1,024,000,
$1,059,000, and $847,000 in 1993, 1992 and 1991, respectively.
In addition to providing pension benefits, the Company provides health care and
life insurance benefits to certain retired U.S. employees and their dependents.
Salaried employees can become eligible for retiree health care benefits at age
55 depending on years of service. Certain hourly employees currently can
become eligible for retiree health care benefits at age 60 depending on years
of service. Retirees receive substantially the same health care benefits as
active employees. The medical plans generally pay 80% of most medical expenses
less deductible amounts. Salaried employees also contribute to the cost of
dependent coverage. The salaried employee coverage converts to a Medicare
supplement at age 65, while most hourly employee coverage ceases at age 65.
The Company adopted Statement of Financial Accounting Standards No. 106 ("SFAS
106") effective January 1, 1992. This statement requires accrual of the
expected cost of providing postretirement benefits. This cost, principally for
health care benefits, had previously been recognized as expense only when
payments were made. The Company recognized the entire accumulated benefit
obligation at the date of adoption, resulting in a one-time charge of
$34,544,000. This amount is reported separately on the consolidated statement
of operations. In addition, the Company's postretirement benefit costs
increased approximately $2,400,000 and $1,600,000 in 1993 and 1992,
respectively, as a result of adopting the new standard.
<PAGE> 26
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
9. RETIREMENT PLANS AND BENEFITS (CONTINUED)
Net postretirement benefit expense for 1993 and 1992 included the following
components (in thousands of dollars):
<TABLE>
<CAPTION>
1993 1992
-----------------------
<S> <C> <C>
Service cost (benefits earned) $1,217 $1,033
Interest cost on accumulated benefit obligation 2,745 2,671
Amortization of loss 51 -
-----------------------
$4,013 $3,704
=======================
</TABLE>
Payments for postretirement benefits charged to expense were $1,370,000 in
1991. The Company intends to continue funding the plan on a pay-as-you-go
basis.
The reconciliation of the plan's funded status to the amounts reported in the
Company's consolidated balance sheets at December 31, 1993 and 1992 is as
follows (in thousands of dollars):
<TABLE>
<CAPTION>
1993 1992
-----------------------
<S> <C> <C>
Present value of accumulated postretirement
benefit obligation:
Retirees $14,471 $13,940
Fully eligible active participants 6,273 2,949
Other active participants 20,252 20,407
-----------------------
40,996 37,296
Unrecognized net loss (3,782) (1,148)
-----------------------
Postretirement benefit liability included in
consolidated balance sheets $37,214 $36,148
=======================
</TABLE>
The discount rate used in determining the present value of the accumulated
postretirement benefit obligation was 6.75% at December 31, 1993, 7.5% at
December 31, 1992 and 8% at January 1, 1992. The assumed health care cost
trend rate used in measuring the accumulated postretirement benefit obligation
was 12.5% in 1993, declining by 0.5% per
<PAGE> 27
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
9. RETIREMENT PLANS AND BENEFITS (CONTINUED)
year to an ultimate rate of 6%. If the assumed health care cost trend rate
were increased 1% in all future years, the accumulated postretirement benefit
obligation would increase by $3,117,000 and postretirement benefit expense
would increase by $401,000.
10. INCOME TAXES
The Company adopted Statement of Financial Accounting Standards No. 109 ("SFAS
109") effective January 1, 1992. Prior to then the Company calculated its
income tax provision in accordance with SFAS 96. The cumulative effect on
prior years of adopting SFAS 109 was a benefit of $6,123,000. This amount is
reported separately on the consolidated statement of operations. The provision
(benefit) for income taxes consists of the following (in thousands of dollars):
<TABLE>
<CAPTION>
1993 1992 1991
-------------------------------------------
<S> <C> <C> <C>
Current:
Federal $(6,609) $(1,000) $ 225
State 1,394 1,238 889
Foreign 1,343 4,925 3,583
-------------------------------------------
(3,872) 5,163 4,697
Deferred:
Federal (3,100) (848) (1,364)
State (1,241) (167) (188)
Foreign (299) 162 (67)
-------------------------------------------
(4,640) (853) (1,619)
-------------------------------------------
$(8,512) $ 4,310 $ 3,078
===========================================
</TABLE>
Income taxes paid (refunded) were $(626,000), $5,779,000 and $5,526,000 in
1993, 1992 and 1991, respectively.
<PAGE> 28
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
10. INCOME TAXES (CONTINUED)
The provision (benefit) for income taxes differs from the amount computed by
applying statutory U.S. federal income tax rates to income before income taxes
for the following reasons (in thousands of dollars):
<TABLE>
<CAPTION>
1993 1992 1991
-------------------------------------------
<S> <C> <C> <C>
Provision (benefit) for income taxes
at U.S. statutory rate $(10,197) $ 784 $ 4,032
(Gains) losses with no tax effect - 403 (2,865)
Other charges with no tax effect 1,244 545 -
Difference between U.S. and
foreign tax rates (85) 1,975 1,158
State income taxes, net of federal
tax benefits 99 707 463
Other 427 (104) 290
-------------------------------------------
$ (8,512) $ 4,310 $ 3,078
===========================================
</TABLE>
<PAGE> 29
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
10. INCOME TAXES (CONTINUED)
The tax effects of the types of temporary differences and carryforwards which
give rise to deferred income tax assets (liabilities) at December 31, 1993 and
1992 are as follows (in thousands of dollars):
<TABLE>
<CAPTION>
1993 1992
-----------------------------
<S> <C> <C>
Compensation and benefit items,
primarily related to SFAS 106 $ 20,649 $ 16,126
Operating, capital loss and AMT credit
carryforwards 13,909 10,583
Tax basis of investment in former
Swedish operations 7,271 6,746
Other temporary differences 10,125 4,446
-----------------------------
Gross deferred income tax assets 51,954 37,901
Valuation allowance (30,520) (20,846)
-----------------------------
21,434 17,055
-----------------------------
Depreciation and related items (13,638) (14,755)
Other temporary differences (2,645) (3,247)
-----------------------------
Gross deferred income tax liabilities (16,283) (18,002)
-----------------------------
Net deferred income taxes $ 5,151 $ (947)
=============================
</TABLE>
These amounts are included in the consolidated balance sheets as follows (in
thousands of dollars):
<TABLE>
<CAPTION>
1993 1992
-----------------------------
<S> <C> <C>
Current assets $ 3,735 $ -
Other assets 5,898 -
Noncurrent liabilities (4,482) (947)
-----------------------------
$ 5,151 $ (947)
=============================
</TABLE>
The net change in the valuation allowance during 1992 was an increase of
$2,931,000, primarily related to acquired operating loss carryforwards.
<PAGE> 30
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
10. INCOME TAXES (CONTINUED)
The deferred income tax benefit recorded in 1991 was primarily due to
differences in recognizing depreciation and compensation and benefits expense
for income tax and financial reporting purposes.
There are certain limitations on the use of most of the tax loss carryforwards
noted above. Tax loss carryforwards of approximately $12,991,000 expire in
various amounts between 1996 and 2008, while approximately $918,000 of such
carryforwards may be used indefinitely.
Approximately $4,300,000 of the deferred tax asset valuation allowance will be
allocated to costs in excess of net assets acquired if the related future tax
benefits are subsequently recognized.
<PAGE> 31
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
11. GEOGRAPHIC AREA AND MAJOR CUSTOMER INFORMATION
The Company produces iron castings principally for automotive and industrial
manufacturers. Its operations include foreign manufacturing facilities,
primarily in Europe. All sales are to unaffiliated customers. Revenue and
income amounts for the three years ended December 31, 1993, and identifiable
assets at the end of each year, were as follows for U.S. and foreign operations
(in thousands of dollars):
<TABLE>
<CAPTION>
1993 1992 1991
--------------------------------------------
<S> <C> <C> <C>
Net sales:
U.S $383,182 $315,399 $248,026
Foreign 61,032 86,552 71,758
Operating profit (loss):
U.S (29,015) (5,541) (1,331)
Foreign 5,529 11,371 8,894
Income (loss) before taxes,
minority interest, and
cumulative effect of
accounting changes:
U.S. (32,524) (7,243) 4,098
Foreign 3,389 9,550 7,762
Identifiable assets:
U.S. 261,195 222,298 161,328
Foreign 46,263 52,159 52,879
</TABLE>
Net sales to customers exceeding 10% of consolidated net sales were as follows
(as a percentage of consolidated net sales):
<TABLE>
<CAPTION>
CUSTOMER 1993 1992 1991
------------------------------------------------------------
<S> <C> <C> <C>
Chrysler 23% 22% 23%
Ford 23 20 20
General Motors 10 10 6
</TABLE>
<PAGE> 32
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
12. QUARTERLY DATA AND SHARE INFORMATION (UNAUDITED)
<TABLE>
<CAPTION>
FIRST SECOND THIRD FOURTH
QUARTER QUARTER QUARTER QUARTER
-----------------------------------------------------------
(In Thousands of Dollars, Except Per Share Data)
<S> <C> <C> <C> <C>
1993
Net sales $122,763 $122,692 $ 92,694 $106,065
Gross profit 12,707 12,923 1,089 8,660
Net income (loss) 720 1,213 (21,268) (1,169)
Net income (loss) per common
share .03 .05 (.87) (.05)
Share prices (OTC):
High 12 11 11 10
Low 9.5 9 9 6
Cash dividends per common share .04 .04 .04 -
1992
Net sales $ 87,045 $109,096 $101,352 $104,458
Gross profit 9,857 14,644 9,941 5,702
Income (loss) before cumulative
effect of accounting changes 114 2,107 (690) (3,046)
Net income (loss) (28,307) 2,107 (690) (3,046)
Per share amounts:
Income (loss) before cumulative
effect of accounting changes .01 .10 (.03) (.12)
Net income (loss) (1.34) .10 (.03) (.12)
Share prices (OTC):
High 12 13.25 10.75 10.25
Low 7.25 9.75 8.875 8.125
Cash dividends per common share .04 .04 .04 .04
</TABLE>
<PAGE> 33
Intermet Corporation
Notes to Consolidated Financial Statements (continued)
12. QUARTERLY DATA AND SHARE INFORMATION (UNAUDITED) (CONTINUED)
The Company was granted a retroactive price increase on certain products in
December 1993. Had this price increase been in effect at the beginning of the
year, first, second and third quarter net income (loss) would each have been
favorably affected by $.01 per share.
Third and fourth quarter sales are usually lower than the first and second
quarter sales due to plant closings by automotive manufacturers for vacations
and model changeovers. The above share price information represents
inter-dealer transactions in The Nasdaq National Market without retail
markup, markdown or commission.
<PAGE> 1
EXHIBIT 21
<TABLE>
<CAPTION>
INCORPORATION
OR PLACE OF
NAME OF SUBSIDIARY ORGANIZATION
- ------------------ ------------
<S> <C>
InterMotive Technologies, Inc. Michigan
Columbus Foundries, Inc. Georgia
Columbus Neunkirchen Foundry, GmbH Federal Republic of
Germany
Commercial and Precision
Machining, Inc. Georgia
I.C. Venture, Inc. Georgia
Intermet Aluminum, Inc. Georgia
Intermet Foundries, Inc. Georgia
Intermet International, Inc. Georgia
Intermet Machining, Inc. Georgia
Ironton Iron, Inc. Ohio
Lynchburg Foundry Company Virginia
New River Castings Company Delaware
Northern Casting Corporation Georgia
PBM Industries, Inc. Delaware
Pennsylvania Castings Corporation Georgia
</TABLE>
<PAGE> 1
(Logo)
INTERMET CORPORATION
SUITE 1600
2859 PACES FERRY ROAD
ATLANTA, GEORGIA 30339
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
APRIL 28, 1994
The annual meeting of shareholders of Intermet Corporation (the "Company")
will be held on Thursday, April 28, 1994, at 10:00 a.m. at Cobb Galleria Centre,
Two Galleria Parkway, Atlanta, Georgia, for the purpose of considering and
voting upon the following matters, all of which are described in the attached
Proxy Statement:
1. The election of eleven directors to constitute the Board of
Directors and to serve until the next Annual Meeting and until their
successors are elected and qualified.
2. Such other matters as may properly come before the meeting or any
adjournment thereof.
Only shareholders of record at the close of business on March 17, 1994,
will be entitled to notice of and to vote at the meeting or any adjournment
thereof.
A Proxy Statement and a Proxy solicited by the Board of Directors are
enclosed. Please sign, date and return the Proxy promptly in the enclosed
business reply envelope. If you attend the meeting, you may, if you wish,
withdraw your Proxy and vote in person.
Also enclosed is the Company's 1993 Annual Report to Shareholders, which
contains financial data and other information concerning the Company.
By Order of the Board of Directors,
John D. Ernst
Vice President - Finance,
Chief Financial Officer,
Secretary and Treasurer
March 30, 1994
PLEASE COMPLETE AND RETURN THE ENCLOSED PROXY PROMPTLY SO THAT YOUR VOTE MAY BE
RECORDED AT THE MEETING IF YOU DO NOT ATTEND PERSONALLY.
<PAGE> 2
INTERMET CORPORATION
SUITE 1600
2859 PACES FERRY ROAD
ATLANTA, GEORGIA 30339
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation of
Proxies by the Board of Directors of Intermet Corporation (the "Company") for
use at the annual meeting of shareholders of the Company (the "Annual Meeting")
to be held on April 28, 1994, and any adjournment thereof, for the purposes set
forth in the accompanying notice of the meeting.
The expense of this solicitation, including the cost of preparing and
mailing this Proxy Statement, will be paid by the Company. Copies of
solicitation materials may be furnished to banks, brokerage houses and other
custodians, nominees and fiduciaries for forwarding to beneficial owners of
shares of the Company's Common Stock, and normal handling charges may be paid
for the forwarding service. In addition to solicitations by mail, directors and
regular employees of the Company may solicit Proxies in person, or by telephone
or telegraph. It is anticipated that this Proxy Statement and the accompanying
Proxy will first be mailed to shareholders on or about March 30, 1994.
Any Proxy given pursuant to this solicitation may be revoked without
compliance with any other formalities by any shareholder who attends the meeting
and gives oral notice of his or her election to vote in person. In addition, any
Proxy given pursuant to this solicitation may be revoked prior to the meeting by
delivering to the Secretary of the Company a notice of revocation or a duly
executed Proxy for the same shares bearing a later date.
THE COMPANY WILL FURNISH WITHOUT CHARGE A COPY OF ITS ANNUAL REPORT ON FORM
10-K FILED WITH THE SECURITIES AND EXCHANGE COMMISSION FOR THE FISCAL YEAR ENDED
DECEMBER 31, 1993, INCLUDING FINANCIAL STATEMENTS AND SCHEDULES, TO ANY RECORD
OR BENEFICIAL OWNER OF ITS COMMON STOCK AS OF MARCH 17, 1994 WHO REQUESTS A
COPY. ANY REQUEST FOR THE ANNUAL REPORT ON FORM 10-K SHOULD BE IN WRITING
ADDRESSED TO:
JOHN D. ERNST, SECRETARY
INTERMET CORPORATION
SUITE 1600, 2859 PACES FERRY ROAD
ATLANTA, GEORGIA 30339
IF THE PERSON REQUESTING THE REPORT WAS NOT A SHAREHOLDER OF RECORD ON MARCH 17,
1994, THE REQUEST MUST INCLUDE A REPRESENTATION THAT THE PERSON WAS A BENEFICIAL
OWNER OF COMMON STOCK ON THAT DATE. COPIES OF ANY EXHIBITS TO THE ANNUAL REPORT
ON FORM 10-K WILL ALSO BE FURNISHED TO SHAREHOLDERS ON REQUEST AND UPON THE
PAYMENT OF THE COMPANY'S EXPENSE IN FURNISHING THE EXHIBITS.
VOTING SECURITIES AND PRINCIPAL HOLDERS
The record of shareholders entitled to vote at the Annual Meeting was taken
as of the close of business on March 17, 1994. On that date the Company had
outstanding and entitled to vote 24,580,719 shares of Common Stock, par value
$0.10 per share, with each share entitled to one vote. All references in this
Proxy Statement to percentages of shares beneficially owned are based on
24,754,719 shares of Common Stock deemed outstanding (which includes presently
exercisable options to purchase 182,500 shares of Common Stock held by directors
and executive officers).
The following table sets forth certain information concerning the only
"persons" (as that term is defined by the Securities and Exchange Commission
("SEC")) who are known to the Company to be the beneficial owners of more than
five percent (5%) of the Company's Common Stock, which is its only class of
voting securities, as of January 1, 1994, and the ownership of the Company's
Common Stock as of that date by the
<PAGE> 3
directors, each of the Named Officers (as defined under "Executive Compensation"
below), and by all directors and executive officers of the Company as a group.
<TABLE>
<CAPTION>
NUMBER OF SHARES
OWNER OWNED BENEFICIALLY PERCENT OF CLASS
- --------------------------------------------------------- ------------------ ----------------
<S> <C> <C>
George W. Mathews, Jr. 4,665,953(1) 18.8%
Suite 1600
2859 Paces Ferry Road
Atlanta, Georgia 30339
The Prudential Insurance Company of America 2,365,522(2) 9.6%
Prudential Plaza
Newark, NJ 07101
Trust Company Bank (as Trustee for Intermet Corporation 1,574,127 6.4%
Employee Stock Ownership Trust)
25 Park Place, N.E.
Atlanta, GA 30303
David L. Babson & Company, Inc. 1,471,100(3) 5.9%
One Memorial Drive
Cambridge, MA 02142
J.P. Morgan & Co. Incorporated 1,236,200(4) 5.0%
60 Wall Street
New York, NY 10260
Vernon R. Alden 19,500(5) *
J. Frank Broyles 75,310(5) *
John P. Crecine 3,000 *
Anton Dorfmueller, Jr. 12,000(6) *
John B. Ellis 15,000(5) *
Wilfred E. Gross, Jr. 477,500(5) 1.9%
A. Wayne Hardy 124,578(5) *
Harold C. McKenzie, Jr. 48,500(5)(7) *
J. Mason Reynolds 16,500(8) *
Curtis W. Tarr 88,292(9) *
E.A. Bodnar 42,377(10) *
John D. Ernst 108,488(11) *
Daryl R. Marsh 3,500 *
All Executive Officers 5,807,563(12) 23.5%
and Directors as a Group
(17 persons)
(1) Does not include 723,300 shares of Common Stock owned of record by Mr.
Mathews' wife, as trustee for their adult children, as to which Mr. Mathews
disclaims beneficial ownership. Includes presently exercisable options for
35,500 shares of Common Stock.
(2) Includes 2,364,400 shares with respect to which The Prudential Insurance
Company of America ("Prudential") has sole voting and dispositive power and
1,122 shares with respect to which Prudential has shared voting and
dispositive power, as reported on Schedule 13G, dated as of December 31,
1993, filed with the SEC.
(3) Includes 1,054,600 shares with respect to which David L. Babson & Company,
Inc. ("Babson") has sole voting power and 416,500 shares with respect to
which Babson has shared voting power. Babson has sole dispositive power
with respect to 1,471,100 shares, as reported on Schedule 13G, dated as of
December 31, 1993, filed with the SEC.
(4) Includes 730,000 shares with respect to which J.P. Morgan & Co.,
Incorporated ("Morgan") has sole voting power and 1,236,200 shares with
respect to which Morgan has sole dispositive power, as reported on Schedule
13G, dated as of December 31, 1993, filed with the SEC.
(5) Includes presently exercisable options for 10,000 shares of Common Stock.
(6) Includes presently exercisable options for 4,000 shares of Common Stock.
(7) Includes 38,500 shares of common stock held as co-trustee under the will of
Mr. McKenzie's father.
(8) Includes presently exercisable options for 6,000 shares of Common Stock.
(9) Includes presently exercisable options for 3,500 shares of Common Stock.
(10) Includes presently exercisable options for 29,500 shares of Common Stock.
(11) Includes presently exercisable options for 22,500 shares of Common Stock.
(12) Includes presently exercisable options for 182,500 shares of Common Stock.
- ---------------
* Less than one percent
</TABLE>
2
<PAGE> 4
NOMINATION AND ELECTION OF DIRECTORS
The By-Laws of the Company provide that the Board of Directors shall
consist of eleven directors. The term of office for each director continues
until the next annual meeting and until his successor is elected and qualified.
Each Proxy executed and returned by a shareholder will be voted as
specified thereon by the shareholder. If no specification is made, the Proxy
will be voted for the election of the nominees named below to constitute the
entire Board of Directors. In the event that any nominee withdraws or for any
reason is not able to serve as a director, the Proxy will be voted for such
other person as may be designated by the Board of Directors as a substitute
nominee, but in no event will the Proxy be voted for more than eleven nominees.
Management of the Company has no reason to believe that any nominee will not
serve if elected. All of the nominees are currently directors of the Company.
Directors are elected by a plurality of the votes cast by the holders of
the shares entitled to vote in an election at a meeting at which a quorum is
present. A quorum is present when the holders of a majority of the shares
outstanding on the record date are present at a meeting in person or by proxy.
An abstention and a broker non-vote would be included in determining whether a
quorum is present at a meeting, but would not otherwise affect the outcome of a
vote.
3
<PAGE> 5
INFORMATION ABOUT NOMINEES FOR DIRECTOR
The following information, as of January 1, 1994, has been furnished by the
respective nominees for director. Except as otherwise indicated, each nominee
has been or was engaged in his present or last principal employment, in the same
or a similar position, for more than five years.
<TABLE>
<CAPTION>
<S> <C>
NAME
AGE INFORMATION ABOUT NOMINEE
- ----------------------- -----------------------------------------------------
(Picture Chairman of the Board, Chief Executive Officer, and
of Mathews) Director of the Company and its predecessor since
------------------- 1971 and President of the Company since 1991.
-------------------
-------------------
-------------------
-------------------
-------------------
-------------------
George W. Mathews, Jr.
(66)
(Picture Director of the Company since 1984, Vice Chairman
of Tarr) of the Board since 1992, President of Intermet
------------------- International, Inc. since 1991, and a consultant
------------------- to the Company from late 1989 through 1990. Mr. Tarr
------------------- was a professor and Dean of the Johnson School of
------------------- Management at Cornell University from 1984 through
------------------- 1989 and remained a professor there until 1990. He
------------------- was a Vice President of Deere & Co., a farm
------------------- equipment manufacturer, from 1973 to 1983. Mr. Tarr
Curtis W. Tarr was President of Lawrence University, Appleton,
(69) Wisconsin, from 1963 to 1969 and an Undersecretary
of State from 1972 to 1973. He is also a director
of George Banta Co., Inc., a commercial printer,
and of State Farm Insurance Companies.
(Picture Director of the Company since 1986. A private
of Alden) consultant, Mr. Alden was Chairman of the Board and
------------------- Executive Committee of The Boston Company, Inc.,
------------------- a financial services company, from 1969 to 1978
------------------- and President of Ohio University from 1962 to 1969.
------------------- He is also a director of Augat, Inc., Colgate-
------------------- Palmolive Company, Digital Equipment Corporation,
------------------- McGraw-Hill, Inc. and Sonesta International
------------------- Hotels Corporation.
Vernon R. Alden
(70)
(Picture Director of the Company since 1986 and its
of predecessor from 1977 to 1984. Mr. Broyles has
Broyles) been Athletic Director of the University of
------------------- Arkansas since 1958.
-------------------
-------------------
-------------------
-------------------
-------------------
J. Frank Broyles
(69)
4
<PAGE> 6
(Picture Director of the Company since 1993. Mr. Crecine has
of Crecine) been President of the Georgia Institute of
------------------- Technology since 1987. Previously he served as a
------------------- professor at the University of Michigan and
------------------- founding director of the Institute of Public
------------------- Policy Studies from 1965 to 1975. He became Dean
------------------- of the College of Humanities and Social Sciences at
------------------- Carnegie Mellon University in 1976, a position
------------------- he held until 1983 when he became the University's
John P. Crecine Senior Vice President for Academic Affairs. He held
(54) that position until his Georgia Tech appointment.
Mr. Crecine is a director of HBO and Co.
(Picture Director of the Company since 1991. A consultant to
of Andersen Consulting since 1988, Mr. Dorfmueller
Dorfmueller) retired that same year as a Group Vice President
------------------- of Ashland Chemical Company, a position he held
------------------- since 1980.
-------------------
-------------------
-------------------
-------------------
Anton Dorfmueller, Jr.
(67)
(Picture Director of the Company since 1989. A private
of Ellis) investor, Mr. Ellis retired in 1985 as Senior Vice
------------------- President - Finance and Treasurer of Genuine Parts
------------------- Co., an automotive parts distributor, where he had
------------------- been employed in various capacities since 1974.
------------------- Mr. Ellis is a director of Flowers Industries,
------------------- Inc., Genuine Parts Co., Hughes Supply, Inc.,
------------------- Oxford Industries, Inc., and Interstate/Johnson
------------------- Lane, Inc.
John B. Ellis
(69)
(Picture Director of the Company and its predecessor since
of Gross) 1971. Mr. Gross is Chairman of the Board of
------------------- Directors and Manager of W.T. Harvey Lumber
------------------- Company in Columbus, Georgia.
-------------------
-------------------
-------------------
-------------------
-------------------
Wilfred E. Gross, Jr.
(65)
(Picture Director of the Company and its predecessor since
of Hardy) 1978. Mr. Hardy is a private investor and
------------------- consultant. He was Chairman and Chief Executive
------------------- Officer of Eastern Inter-Trans Services, Inc. from
------------------- 1986 to 1992. From 1975 to 1986 Mr. Hardy was a
------------------- Vice President of the Company and its predecessor.
-------------------
-------------------
-------------------
A. Wayne Hardy
(57)
5
<PAGE> 7
(Picture of Director of the Company and its predecessor since
McKenzie) 1971. Mr. McKenzie retired at the end of 1986 from
------------------- Southern Electric International, Inc., a subsidiary
------------------- of The Southern Company, with which he was
------------------- affiliated for thirty years. He had served as
------------------- Executive Vice President of Georgia Power
------------------- Company and as President and CEO of Southern Electric
------------------- International, Inc. He was Chairman and CEO of Machine
------------------- Technologies, Inc. of Martinsville, Virginia, from
Harold C. McKenzie, Jr. 1986 until 1989 when that Company filed a petition
(62) under Chapter 11 of the federal bankruptcy laws and
substantially all of its assets were sold. From 1989
to 1991, Mr. McKenzie was a commercial real estate
broker with Haas & Dodd Realty Co. in Atlanta,
Georgia. Mr. McKenzie is presently serving as
Facilities Management Coordinator for The Atlanta
Project of The Carter Presidential Center.
(Picture Director of the Company since 1990. From 1986 until
of Reynolds) his retirement in 1989, Mr. Reynolds was Executive
------------------- Vice President of Allied Signal Corp. and President
------------------- of its Automotive Sector, which manufactures
------------------- automobile parts.
-------------------
-------------------
-------------------
-------------------
J. Mason Reynolds
(66)
</TABLE>
There are no family relationships among the executive officers and
directors of the Company.
Directors who are not officers of the Company received a retainer of $3,000
per quarter during 1993 and $1,500 for each Board of Directors meeting attended,
$500 for each committee meeting attended on the date of a regular Board meeting,
and $1,000 for each other committee meeting attended. Directors are reimbursed
for expenses incurred in attending Board of Directors and committee meetings.
6
<PAGE> 8
EXECUTIVE COMPENSATION
The following table sets forth the annual and long-term compensation paid
by the Company and its subsidiaries to the Company's Chief Executive Officer and
to the other four most highly compensated executive officers of the Company
(collectively, the "Named Officers") for services rendered to the Company during
1993, 1992 and 1991.
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
--------------
ANNUAL COMPENSATION OPTIONS, SARS
NAME AND PRINCIPAL ------------------------------------- (NO. OF ALL OTHER
POSITION YEAR SALARY BONUS(1) OTHER(2) SHARES) COMPENSATION(3)
- -------------------------- ---- -------- -------- -------- -------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
George W. Mathews, Jr..... 1993 $289,008 -- $1,313 16,000 17,801
Chairman of the Board, 1992 331,508 -- 1,312 16,000 17,188
Chief Executive Officer 1991 325,008 30,000 -- 16,000 --
and President
Curtis W. Tarr............ 1993 185,016 -- 1,161 14,000 14,463
Vice Chairman of the 1992 185,016 -- 1,161 14,000 16,432
Board of the Company and 1991 185,016 30,000 -- 14,000 --
President, Intermet
International, Inc.
E. A. Bodnar.............. 1993 185,016 -- -- 14,000 14,463
President, Intermet 1992 185,016 -- -- 14,000 16,432
Foundries, Inc. 1991 175,008 30,000 -- 14,000 --
John D. Ernst............. 1993 140,016 10,000 1,254 14,000 12,013
Vice 1992 140,016 -- 1,254 14,000 13,282
President - Finance, 1991 130,008 30,000 -- 14,000 --
Chief Financial Officer,
Secretary and Treasurer
Daryl R. Marsh(4)......... 1993 65,628 68,000 -- -- 375
Vice President 1992 -- -- -- -- --
1991 -- -- -- -- --
- ---------------
(1) The Company has reported bonuses in this Proxy Statement in the year earned,
not in the year paid.
(2) In accordance with the transitional provisions to the revised rules on
executive officer and director compensation disclosure adopted by the SEC,
amounts of "Other Annual Compensation" are excluded for 1991. No shares of
restricted stock are owned by any Named Officer.
(3) For 1993, "All Other Compensation" includes the following: (i) premium
payments of $1,512 paid by the Company on behalf of Messrs. Mathews, Tarr,
Bodnar and Ernst and $375 paid by the Company on behalf of Mr. Marsh under
the Company's life insurance program, under which the Company provides all
employees with life insurance payable to the employee's and his dependents'
designated beneficiaries; (ii) Company Employee Stock Ownership Plan Trust
contributions in the amounts of $7,075, $5,550, $5,550, $4,500 and $0 for
Messrs. Mathews, Tarr, Bodnar, Ernst and Marsh, respectively; and (iii)
Company and Company matching Profit Sharing Plan contributions in the
aggregate amounts of $9,214, $7,401, $7,401, $6,001 and $0 for Messrs.
Mathews, Tarr, Bodnar, Ernst and Marsh, respectively.
(4) Mr. Marsh was hired in August 1993 and received a signing bonus as reported
under "Bonus."
Messrs. Bodnar, Ernst and Tarr and Mr. Peter C. Bouxsein, Controller of
the Company, each inadvertently filed a late Form 5 with respect to the
allocation to the account of each of Common Stock pursuant to the Company's Employee
Stock Ownership Plan for the year ended December 31, 1992, which was reported to
each in March 1993.
</TABLE>
7
<PAGE> 9
OPTION GRANTS. Shown below is further information on grants of stock
options pursuant to the Key Individual Stock Option Plan ("Key Individual Plan")
during 1993 to the Named Officers, which are reflected in the Summary
Compensation Table. No stock appreciation rights were granted during 1993, and
none of the Company's compensation plans currently provides for the grant of
stock appreciation rights.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
NO. OF VALUE AT ASSUMED ANNUAL
SECURITIES % OF TOTAL RATES OF STOCK PRICE
UNDERLYING OPTIONS/SARS APPRECIATION FOR OPTION
OPTION/ GRANTED TO TERM(2)
SARS EMPLOYEES IN EXERCISE EXPIRATION -------------------------
NAME GRANTED(1) 1993 PRICE DATE 0% 5% 10%
- -------------------------------- ---------- ------------ -------- ---------- --- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
George W. Mathews, Jr........... 11,000 3.85% $11.83 2/11/98 $0 $20,792 $60,312
5,000 1.75% 10.75 2/11/03 0 33,803 85,661
Curtis W. Tarr.................. 14,000 4.9% 10.75 2/11/03 0 94,649 239,852
E. A. Bodnar.................... 14,000 4.9% 10.75 2/11/03 0 94,649 239,852
John D. Ernst................... 14,000 4.9% 10.75 2/11/03 0 94,649 239,852
Daryl R. Marsh.................. -- -- -- -- -- -- --
- ---------------
(1) 25% are exercisable on the first anniversary of the grant date, 50% are
exercisable on the second anniversary of the grant date, 75% are
exercisable on the third anniversary of the grant date and 100% are
exercisable on the fourth anniversary of the grant date.
(2) "Potential Realizable Value" is disclosed in response to Securities and
Exchange Commission regulations that require such disclosure for
illustration only. The values disclosed are not intended to be, and should
not be interpreted as, representations or projections of the future value
of the Company's Common Stock or of the stock price. To lend perspective to
the illustrative "Potential Realizable Value," if the Company's Common
Stock price increases 5% per year for 10 years from January 1, 1993
(disregarding any dividend payments and assuming for purposes of the
calculation a constant number of shares outstanding), the total increase in
value of all shares outstanding at January 1, 1993 would be $154,321,055,
and if the stock price increases 10% per year over such period, the
increase in value would be $391,077,523.
</TABLE>
OPTION EXERCISES AND FISCAL YEAR-END VALUES. Shown below is information
with respect to unexercised options to purchase the Company's Common Stock
granted under the Directors Stock Option Plan and Key Individual Plan to the
Named Officers and held by them at December 31, 1993. In addition, information
is shown below with respect to the exercise during fiscal year 1993 by the Named
Officers of options granted under the Directors Stock Option Plan and the Key
Individual Plan.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES
<TABLE>
<CAPTION>
NO. OF SHARES SUBJECT TO VALUE OF UNEXERCISED IN-
UNEXERCISED OPTIONS/ SARS THE-MONEY OPTIONS/ SARS AT
SHARES HELD AT DECEMBER 31, 1993 DECEMBER 31, 1993
ACQUIRED ON VALUE --------------------------- ---------------------------
NAME EXERCISE REALIZED(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ----------------------------- ----------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
George W. Mathews, Jr........ -- -- 35,500 40,500 $46,878 $31,653
Curtis W. Tarr............... 11,000 $38,920 3,500 31,500 0 24,920
E. A. Bodnar................. -- -- 29,500 34,500 46,670 30,920
John D. Ernst................ -- -- 22,500 33,500 39,170 28,920
Daryl R. Marsh............... -- -- -- -- -- --
- ---------------
(1) Based on the closing sale price on The Nasdaq National Market on the date of
exercise less the exercise price.
</TABLE>
8
<PAGE> 10
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board is responsible for setting the
policies on compensation offered to the executive officers of the Company,
including the Named Officers. These policies cover salary and benefits,
including insurance, bonuses, stock options, retirement programs, and other
awards. The following report was prepared by the current members of the
Compensation Committee. All current members of the Committee are independent
outside directors.
EXECUTIVE COMPENSATION POLICIES
The Company seeks to attract and retain key executives who will strive for
the Company's success, both immediately and in the long term. We realize that in
a small industry that is based upon technology not widely understood, we will
not have many opportunities to recruit leaders outside our Company. We also are
aware that we must make the opportunity at the Company attractive so that our
executives will not accept employment elsewhere.
The Company relates executive compensation to what must be done to improve
Company performance and to attract and retain talented people. The Company seeks
to do the former with stock options and bonuses, in an effort to enhance
shareholder value, and the latter with salary. When the Company does well, our
executives should benefit. The Company believes that key executives can affect
dramatically the performance of the Company and that an executive should be
compensated on what he or she achieves.
The Compensation Committee believes that stock options provide an incentive
to executives to encourage the Company to excel in a way that will improve the
price of the stock and thus shareholder value. Because the Key Individual Stock
Option Plan calls for vesting over a period of years, the Committee members also
believe that stock options encourage retention of the skilled executives and
managers the Company needs to perform well.
The Compensation Committee has judged that a significant portion of the
compensation paid to senior executives should be based upon incentive awards.
Thus executive compensation in the future will tend to vary considerably
depending upon the performance of the Company. Given a reasonable growth in the
price of the Company's Common Stock and thus the value of stock options, and the
success of the Company to meet bonus targets, managers and executives of the
Company will be able to increase their earnings from ten to sixty percent above
their base salaries.
FORMS OF COMPENSATION
To carry out these policies, the Company offers the following:
Salary
Salaries for executive jobs, including that of the CEO, are determined by
an evaluation of that job, considering the wisdom, skills, and experience
required for it, and the market pricing of these. To calculate market pricing,
the Company reviewed independent third-party studies prepared by various
organizations which encompassed several hundred companies, including many in
similar lines of business and of comparable size to the Company. We try to look
at job content instead of titles, because we realize that the latter may not
apply well to the jobs in our industry and company. The Committee seeks to set
salaries above the average levels in the surveys.
Job evaluation and market pricing provide a salary range for each position.
Annually the performance appraisal of the executive or manager provides a
rating. This and the person's position within the salary range determine what
the salary merit increase, if any, will be. Each year, the Compensation
Committee reviews this information for each position. In 1993, the Compensation
Committee withheld salary merit increases.
9
<PAGE> 11
The results of the surveys of Marketplace Salary Levels for the Named
Officers were as follows:
<TABLE>
<CAPTION>
MINIMUM AVERAGE AGGRESSIVE
-------- -------- ----------
<S> <C> <C> <C>
Chairman & CEO................................ $310,000 $413,500 $ 516,900
Vice Chairman................................. 131,900 175,800 219,800
President, IFI................................ 131,900 175,800 219,800
VP, Machining................................. 125,300 167,100 208,900
VP, Finance/CFO............................... 124,100 165,400 206,800
</TABLE>
In 1992, because he was not satisfied with the Company's operating
performance, Chairman and Chief Executive Officer George W. Mathews, Jr. asked
that his compensation be reduced by 15%. This was done, and his salary for
November and December of 1992 continued through the year 1993. Committee members
believe that Mr. Mathews' salary, considerably below average for comparable
positions in the survey, should be increased at least to the average level when
the performance of the Company improves.
Benefits
The Company provides benefits at no charge to each salaried employee,
including medical, dental, short and long term disability, accidental death or
dismemberment, life and dependent life insurance. The Company also has a medical
reimbursement plan available to the Named Officers and other key employees that
compensates them for certain medical expenses not covered by the regular group
insurance programs.
Bonuses
Before 1993, the Compensation Committee decided year-to-year whether a
bonus pool should be established, given the performance of the Company. The pool
was then distributed to executives and managers based upon a subjective
evaluation of the contribution by the individual.
For 1993, the Compensation Committee established a formal bonus program for
its key executives and managers. That plan authorized the payment of bonuses if
corporate and division operating profit goals were attained. Because the Company
did not reach these goals, no executive was awarded a bonus under the Bonus Plan
for 1993. However, the Company paid bonuses outside the Bonus Plan to two Named
Officers in 1993 -- $10,000 to John D. Ernst for his successful public placement
of $30 million of the Company's Common Stock in 1992 and for the restructuring
of the Company's lending facilities in 1992 and 1993, and $68,000 to the
newly-recruited Vice President, Machining, Daryl R. Marsh as a signing bonus.
For 1994, the Compensation Committee has established a formal bonus
program, again based upon the achievement of gross profit or operating profit
goals at the manufacturing units or divisions and a pretax income goal at the
corporate level. New in the 1994 plan will be the inclusion of key managers
reporting to the operating unit managers. We hope that the broader participation
will help to improve the operations of the Company. Although the Committee
members discussed the possibility of a part of the bonus being based upon
factors other than financial performance, such as scrap levels or yield or up
time in the foundries, we decided that a simpler plan would be a better
motivator for our executives and managers. A target bonus amount for each
participant has been set, and annual bonuses can range from 0% to 150% of each
participant's target bonus amount depending upon performance.
Stock Options
The Compensation Committee believes that stock options are an effective
inducement to directors and to key executives to meet long-term performance
goals. Accordingly, the Company has asked, and gained approval from the
shareholders, to create two plans, one for directors and one for key
individuals. Committee members believe that options should be granted each year,
at the first regular board meeting, and that the awards should be comparable
from one year to the next. Key executives to whom options are granted are those
considered by the Committee to be individuals best able to improve the
performance of the Company.
10
<PAGE> 12
The Director's Stock Option Plan authorizes the Company to issue options
for not more than 100,000 shares of the Company's Common Stock to directors.
Options granted under the Plan must have an exercise price of no less than the
fair market value of the Common Stock on the date of grant. No options may be
granted after April 26, 2000, and the term of each option may not exceed ten
years from the date of grant. During 1993, ten non-employee directors each
received options for 2,000 shares of the Company's Common Stock at an exercise
price of $10.75 per share.
The Company's Key Individual Stock Option Plan encourages senior executives
to acquire a proprietary interest in the Company and to continue their
employment or association with the Company. The Plan provides for the grant of
both incentive and non-qualified stock options. Options for a total of 1,440,000
shares of the Company's Common Stock may be granted. During 1993, the
Compensation Committee granted options for 286,000 shares of the Company's
Common Stock to 33 key executives and managers at exercise prices ranging from
$10.75 to $11.83 per share. The Committee relates the number of options granted
to executive salary levels.
Retirement Plans
The Company has a two-part retirement program: the 401(k) Savings and
Investment Plan and the Employee Stock Ownership Plan Trust, which are available
to eligible employees, including the Named Officers.
The 401 (k) Savings and Investment Plan permits eligible employees to
contribute up to 10% of their compensation, subject to certain limitations, and
invest it in one or more of three investment funds offered through the Plan. The
Company matches an individual's contribution at a rate of fifty cents for each
dollar saved, up to 4% of pay. At the end of the year, the Company makes an
added contribution to the individual's account of an amount equal to 2% of the
individual's annual compensation.
The Employee Stock Ownership Plan Trust purchases Common Stock of the
Company for eligible employees. The Company contributes an amount equal to 3% of
the individual's wages or salary.
Other Awards
The Company provides automobiles for certain key employees including sales
people. When these are used for personal rather than business needs, the Company
determines the cost of that use and includes that amount on the W-2 form sent to
the Internal Revenue Service.
The Company has a salary continuation plan in the event of the death of
certain key executives. Salary is paid for one year following the death of the
Chairman or President of the Company, for nine months for other executive
officers of the Company, and for six months for certain executive officers of
one of the subsidiaries of the Company.
The Company provides certain key employees with memberships in country and
social clubs if doing so is helpful to the attraction and maintenance of
business relationships.
The Company has no plan for payments to its executives in the event that an
outside group takes control of the Company.
INTERMET CORPORATION COMPENSATION COMMITTEE
Vernon R. Alden, Chairman
J. Frank Broyles
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Mr. Mathews, Chairman, Chief Executive Officer and President of the
Company, and Mr. Tarr, Vice Chairman of the Board of the Company and President
of Intermet International, Inc., were members of the Compensation Committee
through April 1993, and each attended one of two Compensation Committee meetings
in 1993.
11
<PAGE> 13
Mr. Mathews acquired 49% of the voting stock of Systrand Manufacturing
Corporation ("Systrand"), a machining company located in Detroit, Michigan,
during 1992. The Company, through its Board of Directors, declined to purchase
such shares and approved Mr. Mathews' purchase. Mr. Mathews and the other
shareholder of Systrand granted to the Company an option, exercisable during
1996-1998, to purchase all of the shares of Systrand, subject to certain
conditions, for cash or Company Common Stock. In 1993, Mr. Mathews acquired 50%
of a machining company, also located in the Detroit area, owned by an affiliate
of the other shareholder of Systrand (the "Related Company"), and Mr. Mathews
and such affiliate shareholder have granted an option to the Company to purchase
all of the shares of the Related Company. During 1993, the Company purchased
$631,000 of machining services from Systrand and the Related Company, which were
merged in September 1993.
SHAREHOLDER RETURN PERFORMANCE GRAPH
Set forth below is a line graph comparing the yearly percentage change in
the cumulative total shareholder return on the Company's Common Stock against
the cumulative total return of the Russell 2000 Index and the cumulative total
return for a group of companies consisting of Arvin Industries, Inc., Chrysler
Corporation, Dana Corporation, Ford Motor Company, General Motors Corporation,
Masco Industries, Inc., Simpson Industries, Inc. and Standard Products Company,
for the period of five years commencing on December 31, 1988 and ended December
31, 1993.
1989 1990 1991 1992 1993
------ ------ ------ ------ ------
INMT 96 59 90 124 117
Russell 2000 116 94 137 162 193
Peer Group 97 76 74 111 182
CERTAIN TRANSACTIONS
In September 1986, the Company sold all of the capital stock and
intercompany debt of the Company's wholly-owned subsidiary, Intermet
Transportation, Inc., to Eastern Inter-Trans Services, Inc. ("EITS") at book
value. At the time of sale, A. Wayne Hardy, a director of the Company, was
Chairman, Chief Executive Officer and a principal shareholder of EITS. The
aggregate sale price was paid partially in cash and the balance by delivery of a
$240,000 unsecured promissory note (the "Note"). The Note, as amended, bore
12
<PAGE> 14
interest at a rate two percentage points above the prime rate at a designated
bank and was due and payable in thirty-one installments of $4,000 each,
commencing in October 1988, with a final installment of $116,000 due in
September 1991. The parties amended the Note in May 1992 to reflect that the
then outstanding principal amount of $132,000 and accrued and unpaid interest of
$14,529 plus interest at 5% per annum from May 8, 1992 would be repaid on June
30, 1993. Payments of $20,100 were made with respect to the Note during 1993.
The Company and Mr. Hardy are currently in negotiations to restructure the
Note's payment terms.
The Prudential Insurance Company of America ("Prudential") is the record
owner of 2,365,522 shares (9.6%) of the outstanding Company Common Stock.
Prudential had certain piggyback registration rights with respect to 3,629,400
shares of Common Stock which were granted in 1980 when the Company issued to
Prudential warrants to purchase shares of Common Stock as part of a subordinated
debt financing. The Company has extended Prudential's piggyback registration
rights through December 31, 1995 (the "Extended Registration Rights") with
respect to 2,364,400 shares of Common Stock. These rights had been scheduled to
expire on September 30, 1992. All expenses, disbursements and fees associated
with the Extended Registration Rights will be allocated between the Company and
Prudential pro rata, based on the number of shares sold by each. On December 11,
1992, the Company sold $25,000,000 principal amount of Senior Notes due December
11, 2002 to Prudential.
On March 31, 1992, a subsidiary of the Company acquired all of the common
and preferred stock of PBM Industries, Inc. ("PBM") and all of the outstanding
preferred stock of Batten Design and Engineering Services, Inc. (now known as
InterMotive Technologies, Inc.), an 80% owned subsidiary of PBM. In connection
with the acquisition, the Company guaranteed approximately $9,000,000 of PBM's
debt owed to Prudential, which debt was refinanced by the Company as part of the
Trust Company Bank line of credit described below. Prudential and two of its
affiliates were also minority shareholders of PBM, owning in the aggregate 22%
of PBM's common stock and 16% of PBM's preferred stock. As a result of the
acquisition of PBM by the Company, Prudential and its affiliates received
approximately $128,000 in cash and $479,138 in notes for their equity interests.
As of December 31, 1993, a subsidiary of the Company owed approximately $493,338
in principal and interest to Prudential on such notes.
On August 31, 1992 the Company entered into a Credit Agreement with certain
domestic and foreign lenders, relating to a $75,000,000 and DM 8,000,000
revolving line of credit. Trust Company Bank is one of the lenders under the
Credit Agreement and also acts as agent for the other lenders. Trust Company
Bank is the trustee of the Company's Employee Stock Ownership Plan Trust and in
such capacity owns of record 1,574,127 (6.4%) of the Company's outstanding
Common Stock.
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors held five meetings during 1993. All of the directors
attended at least 75% of all meetings of the Board and of each committee of the
Board on which they served except Mr. Crecine, who attended 50% of the Board
meetings held during his tenure as director, Mr. Alden, who attended 50% of the
meetings of the Compensation Committee, and Mr. Dorfmueller, who attended 50% of
the meetings of the Environmental Committee.
The Compensation Committee of the Board of Directors sets the compensation
for the Company's executive officers and key personnel. The Compensation
Committee is currently comprised of Messrs. Alden and Broyles. Messrs. Mathews
and Tarr were members of the Compensation Committee until they resigned from the
Committee in April 1993. Mr. John Aderhold was a member of the Compensation
Committee prior to his resignation from the Board of Directors in February 1994.
The Compensation Committee held two meetings during 1993.
The Audit Committee reviews financial controls and the methods of
preparation of the Company's financial statements, evaluates audit performance
and reports on such matters to the Board. The Audit Committee, which is
currently comprised of Messrs. Dorfmueller, Gross, Hardy and McKenzie, held
three meetings during 1993.
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The Nominating Committee, which is currently comprised of Messrs. Broyles,
Crecine, Mathews and Tarr, was established during the third quarter of 1992. It
has not yet been determined whether the Nominating Committee will consider
nominees recommended by shareholders or what the procedures for such
nominations, if considered, will be. The Nominating Committee did not hold any
meetings during 1993.
INFORMATION CONCERNING THE COMPANY'S ACCOUNTANTS
Ernst & Young were the principal independent auditors for the Company for
1993. Representatives of Ernst & Young are expected to be present at the Annual
Meeting and will have the opportunity to make a statement if they desire to do
so and to respond to appropriate questions. The Company anticipates that Ernst &
Young will be the accountants for the current fiscal year.
SHAREHOLDER PROPOSALS
In accordance with the provisions of Rule 14a-8(a)(-3)(i) of the Securities
and Exchange Commission, proposals of shareholders intended to be presented at
the Company's 1995 Annual Meeting must be received by November 26, 1994 in order
to be eligible for inclusion in the proxy statement and form of proxy for that
meeting.
OTHER MATTERS THAT MAY COME BEFORE THE MEETING
Management of the Company knows of no matters other than those stated above
that are to be brought before the meeting. If any other matter is presented for
consideration and voting, the persons named as proxies in the enclosed Proxy
intend to vote the Proxy in accordance with their judgment of what is in the
best interest of the Company.
Dated: March 30, 1994
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