<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 25, 1994
(March 14, 1994)
Eljer Industries, Inc.
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(Exact name of registrant as specified in charter)
Delaware 1-10181 75-2270874
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(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification
incorporation) No.)
17120 Dallas Parkway, Dallas, Texas 75248
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number,
including area code: (214) 407-2600
Not applicable
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(Former name or former address, if changed since last report)
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Item 5 Other Events
On March 14, 1994, Eljer Industries, Inc. (the "Company") announced an
agreement in principle to settle for $3.4 million the class action securities
litigation against the Company and certain present and former members of the
Board of Directors pending in a federal court in Texas. The proposed
settlement is subject to negotiation and execution of a definitive agreement
among the parties and approval by the court. The Company believes that a
significant portion of the proposed settlement amount would be paid by its
liability insurance carrier. The balance, which is covered by litigation
reserves, would be paid by the Company.
The suit asserted causes of action based on alleged inadequate disclosures
by the Company in its 1989 and 1990 annual report to shareholders and in
particular with respect to the litigation involving the Qest polybutylene
plumbing system manufactured and sold by the Company's indirect, wholly-owned
subsidiary, United States Brass Corporation, and with to the availability of
insurance coverage therefor. The plaintiffs sought unspecified actual and
punitive damages as well as costs and attorneys' fees. In 1992, the court
certified a plaintiff class consisting of all purchasers of the Company's
common stock during the period from March 30, 1990 through August 8, 1991.
The press released dated March 14, 1994, describing the above is filed as
an exhibit hereto and is incorporated by reference herein.
<PAGE>
Item 7 Exhibits
99 The press release dated March 14, 1994, describing the tentative
settlement of the securities litigation class action suit.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ELJER INDUSTRIES, INC.
Date: March 25, 1994 By/S/Henry W. Lehnerer
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Henry W. Lehnerer
Vice President - Finance &
Chief Financial Officer
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EXHIBIT INDEX
<TABLE>
<CAPTION>
Sequential
Exhibit No. Page No.
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<C> <S> <C>
99 The press release dated March 14, 1994,
describing the tentative settlement of the
securities litigation class action suit.
</TABLE>
<PAGE>
News Release
FOR: ELJER INDUSTRIES, INC.
APPROVED BY: Edward W. Fordyce, Jr.
Vice President - General
Counsel
(214) 407-2600
For Immediate Release
CONTACT: Morgen-Walke Associates
Lynn Morgen, June Filingeri
Helen Spanakos - Media
contact
(212) 850-5600
Ken Pieper (214) 701-8851
ELJER INDUSTRIES ANNOUNCES TENTATIVE
SETTLEMENT OF SHAREHOLDER SUIT
DALLAS, Texas, March 14, 1994 -- Eljer Industries, Inc. (NYSE:ELJ) today
announced an agreement in principle to settle for $3.4 million the class action
securities litigation against the Company and certain present and former members
of its Board of Directors pending in a federal court in Texas. The proposed
settlement is subject to negotiation and execution of a definitive settlement
agreement among the parties and approval by the court. Eljer believes that a
significant portion of the proposed settlement amount would be paid by its
liability insurance carrier.
The suit, originally filed as four purported class action suits in December
1991 and later consolidated into one, asserted causes of action based on alleged
inadequate disclosures in the Company's 1989 and 1990 annual report to
shareholders and in particular disclosures with respect to the litigation
involving the Qest polybutylene plumbing system manufactured and sold by the
Company's indirect, wholly-owned subsidiary, United States Brass Corporation,
and with respect to the availability of insurance coverage therefor. The
plaintiffs sought unspecified actual and punitive damages as well as costs and
attorneys fees. In 1992, the court certified a plaintiff class consisting of
all purchasers of the Company's common stock during the period from March 30,
1990 through August 8, 1991.
Scott G. Arbuckle, President and Chief Executive Officer, commented: "We
believe that the disclosures were fair, accurate and complied with all legal
requirements and that Eljer had meritorious defenses
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(LETTERHEAD OF MORGEN-WALKE)
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ELJER INDUSTRIES ANNOUNCED TENTATIVE SETTLEMENT OF SHAREHOLDER SUIT Page 2
to the suit. Nevertheless, we believe that the settlement is in the best
interests of the Company in order to avoid further litigation costs and exposure
in the event the case was tried. A significant portion of the proposed
settlement amount will be paid by our liability insurance carrier. The balance,
which is covered by litigation reserves, will be paid by the Company. The
proposed settlement is in accordance with our previously announced strategy and
commitment to attempt to conclude successfully the significant litigation issues
facing Eljer."
Eljer Industries, Inc. is a leading manufacturer and marketer of high
quality building products, including plumbing, heating and ventilating products,
for the residential and commercial construction, remodeling and repair, and
do-it-yourself markets.
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