1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1994 Commission file number 1-569
MUELLER INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 25-0790410
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
2959 N. ROCK ROAD
WICHITA, KANSAS 67226-1191
(Address of principal executive offices)
Registrant's telephone number, including area code: (316) 636-6300
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
Common Stock, $0.01 Par Value New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by a 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 (Section 229.405 of this chapter) 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 10-K.[___].
The number of shares of the Registrant's common stock outstanding as of March
7, 1995 was 8,642,732, excluding 1,357,268 treasury shares. The aggregate
market value of the 7,558,943 shares of common stock held by non affiliates of
the Registrant was $239,996,440 at March 7, 1995 (based on the closing price
on the consolidated transaction reporting system on that date).
Indicate by check mark whether the Registrant has filed all documents and
reports required to be filed by Section 12, 13, or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes /X/ No / /
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the following documents are incorporated by reference into this
Report: (1) Registrant's Annual Report to Shareholders for the year ended
December 31, 1994 (Part I and II); Registrant's Definitive Proxy Statement for
the 1995 Annual Meeting of Stockholders, scheduled to be mailed on or about
March 17, 1995 (Part III).
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MUELLER INDUSTRIES, INC.
As used in this report, the terms "Company," "Mueller" and "Registrant" mean
Mueller Industries, Inc. and its consolidated subsidiaries taken as a whole,
unless the context indicates otherwise.
TABLE OF CONTENTS
Page
PART I
Item 1. Business 3
Item 2. Properties 13
Item 3. Legal Proceedings 14
Item 4. Submission of Matters to a Vote of Security Holders 15
PART II
Item 5. Market for the Registrant's Common Stock and Related
Stockholder Matters 15
Item 6. Selected Financial Data 15
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations 16
Item 8. Financial Statements and Supplementary Data 16
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure 16
PART III
Item 10. Directors and Executive Officers of the Registrant 16
Item 11. Executive Compensation 16
Item 12. Security Ownership of Certain Beneficial Owners
and Management 16
Item 13. Certain Relationships and Related Transactions 16
Part IV
Item 14. Exhibits, Financial Statement Schedules, and Reports
on Form 8-K 17
Signatures 21
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PART I
ITEM 1. BUSINESS
Introduction
The Company is a leading fabricator of brass, bronze, copper, plastic
and aluminum products. The range of these products is broad: copper tube and
fittings; brass and copper alloy rods, bars and shapes; brass and bronze
forgings; aluminum and copper impact extrusions; plastic fittings and valves;
and refrigeration valves, driers and flare fittings. These operations (the
"Manufacturing Segment") accounted for approximately 97% of the Company's
total net sales and 89% of total identifiable assets on a consolidated basis
in 1994. The Company markets its products to the heating and air
conditioning, refrigeration, plumbing, hardware and other industries. Mueller
Brass Co. ("MBCo") and its subsidiaries operate twelve factories in five
states and Canada and have distribution facilities nationwide and sales
representation worldwide.
The Company's natural resource operations are conducted through its
wholly-owned subsidiary Arava Natural Resources Company, Inc. ("Arava") and
the Company's 85% owned subsidiary Alaska Gold Company ("Alaska Gold").
Natural resource operations consist principally of the operation of a short
line railroad and placer gold mining, and other natural resource properties.
Information concerning net sales, operating income or loss, and
identifiable assets of each segment appears under "Note 12 - Industry
Segments" on page 33 in the Notes to Consolidated Financial Statements in
Mueller's Annual Report to Stockholders for the year ended December 31, 1994.
Such information is incorporated herein by reference.
Manufacturing Segment
Products and Manufacturing Operations
Mueller's standard products include a broad line of copper tube, which
ranges in size from 1/8 inch to 8 inch diameter, and is sold in various
straight lengths and coils. Mueller is a market leader in the air
conditioning and refrigeration tube markets. Additionally, Mueller supplies a
variety of water tube in straight lengths and coils used for plumbing
applications in virtually every type of construction project.
Other standard products include copper and plastic fittings and related
components for the plumbing and heating industry that are used in water
distribution systems, heating systems, air conditioning and refrigeration
applications, and drainage, waste, and vent (DWV) systems. Additionally,
valves, wrot copper and brass fittings, filter driers and other related
assemblies are manufactured for commercial air conditioning and refrigeration
applications such as vending machines, ice machines, walk-in coolers, and
numerous refrigeration applications. The refrigeration product line also
includes products for the refrigeration and air conditioning installation and
service after-markets. A major portion of Mueller's products are ultimately
used in the domestic residential and commercial construction markets and, to a
lesser extent, in the automotive and heavy on and off-the-road vehicle
markets.
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Mueller's industrial products include brass rod, nonferrous forgings and
impact extrusions that are sold primarily to OEM customers in the plumbing,
refrigeration, fluid power, and automotive industries, as well as other
manufacturers and distributors. The Port Huron, Michigan mill extrudes brass,
bronze and copper alloy rod in sizes ranging from 3/8 inches to 4 inches in
diameter. These alloys are used in applications that require a high degree of
machinability, wear and corrosion resistance, and electrical conductivity.
Mueller brass and aluminum forgings are used in a wide variety of end
products, including automotive components, brass fittings, industrial
machinery, valve bodies, gear blanks, computer hardware, and fire fighting
equipment. The Company also serves the automotive, military ordnance,
aerospace and general manufacturing industries with cold-formed aluminum and
copper impact extrusions. Typical applications for impacts are high-strength
ordnance, high-conductivity electrical components, builders' hardware,
hydraulic systems, automotive parts and other uses where toughness must be
combined with varying complexities of design and finish.
Marketing and Distribution
Mueller's standard products are marketed primarily through its own sales
and distribution organization, which maintains sales offices and distribution
centers throughout the United States and in Canada. Additionally, these
products are sold and marketed through a network of agents, which, when
combined with the Company's sales organization, provide the Company broad
geographic market representation. Industrial products are sold, primarily,
direct to customers on an OEM basis. Outside of North America, the Company
sells its products through various channels including exclusive distributors,
agents and direct sales channels in over 65 countries, primarily in Europe,
the Far East and the Middle East.
Competition
The businesses in which Mueller is engaged are highly competitive. The
principal methods of competition for Mueller's products are service, quality
and price. No material portion of Mueller's business is dependent upon a
single customer or a small group of related customers. The total amount of
order backlog for Mueller's products on December 31, 1994 and December 25,
1993 was not significant.
The Company competes with various companies depending on the product
line. In copper tubing, there are more than five domestic competitors
including Cerro Copper Products Co., Inc., Halstead Industries, Inc., Reading
Tube Corporation, and Wolverine Tube, Inc. as well as many actual and
potential foreign competitors. Additionally, it competes with a large number
of manufacturers of substitute products made from plastic, iron and steel. In
the copper fittings market, competitors include Elkhart Products, a division
of Amcast Industrial Corporation, and NIBCO, Inc. The plastic fittings
competitors include more than a dozen companies. The brass rod competitors
include Cerro Metal Products Company, Inc., Chase Brass Industries, Inc.,
Extruded Metals Inc., and others. As illustrated above, no one competitor
offers the range of products as does the Company. Management believes that
the Company's ability to offer such a wide ranging product line is a
competitive advantage in some markets.
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Properties and Facilities
Mueller's products are manufactured in its own plants located in Port
Huron, Michigan (three plants); Fulton, Mississippi (two plants); Covington,
Tennessee; Marysville, Michigan; Hartsville, Tennessee; Upper Sandusky, Ohio;
and Strathroy, Ontario, Canada. Additionally in 1994, the Company acquired
certain assets consisting of two DWV plastic fittings manufacturing
facilities. These facilities are located in Kalamazoo, Michigan and Cerritos,
California. During 1994, 1993, and 1992, the Company's Fulton copper tube
mill and Port Huron rod mill operated at near capacity. The other plants
operated at high levels during 1994.
In addition, Mueller leases office and regional warehouse space for its
standard products distribution network. Products are shipped from
manufacturing plants to distribution centers and customer locations using a
combination of Mueller's own trucking fleet and common carriers. Mueller's
factory warehouses service eight regional warehouses and stocking agents'
warehouses located in key marketing areas throughout the United States.
Raw Materials and Supplies
The major portion of Mueller's base metal requirements (primarily
copper) are normally obtained through short-term supply contracts with
competitive pricing provisions. Other raw materials used in the production of
brass, including brass scrap, zinc, tin and lead are obtained from zinc and
lead producers, open-market dealers and customers with brass process scrap.
Raw materials used in the fabrication of aluminum and plastic products are
purchased in the open market from major producers.
Other
Effective January 13, 1990, Mueller acquired Mueller Plastics Holding
Company, Inc. (then known as U-Brand Corporation) which, at that time,
manufactured malleable iron and plastic fittings. The malleable iron fittings
portion of that business was not profitable and on November 1, 1992, most of
its assets were sold. The remaining iron related assets have since been sold.
The iron fittings business accounted for approximately $20.0 million of the
Company's net sales in 1992.
Natural Resources Segment
Mueller, through its subsidiaries Arava and Alaska Gold, is engaged in
the operation of a short line railroad and placer gold mining. It also owns
interests in other natural resource properties.
Short Line Railroad
Utah Railway Company ("Utah Railway"), a wholly-owned subsidiary of
Arava, operates over approximately 100 miles of railroad track in Utah. Utah
Railway serves four major customers pursuant to long-term contracts which
account for more than 75% of tonnage hauled. Utah Railway transports
approximately four million tons of coal per year to an interchange point at
Provo, Utah, although annual tonnage may vary significantly due to
fluctuations in the demand for export coal. The coal is then transported by
connecting railroads to various customers including electric utilities, cement
plants, west coast export facilities and others at destinations throughout the
West.
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Gold Mining
Alaska Gold, an 85% owned subsidiary of the Company, mines placer gold
in Nome, Alaska. Historically, operations have been conducted using floating,
bucket-line dredges. Alaska Gold expects limited dredge operations in 1995.
Alaska Gold produced 14,173 net ounces of gold in 1994, 22,440 net ounces of
gold in 1993, 17,965 net ounces of gold in 1992, 19,016 net ounces of gold in
1991, and 20,771 net ounces in 1990, at a net production cost of $376 per
ounce in 1994, $280 per ounce in 1993, $306 per ounce in 1992, $407 per ounce
in 1991, and $415 per ounce in 1990.
Properties consist of approximately 14,500 acres in and adjacent to
Nome. In addition, Alaska Gold owns or has patented claims on approximately
10,400 acres in the Fairbanks, Alaska area, and approximately 3,000 acres in
the Hogatza, Alaska area.
During 1992-93, Alaska Gold undertook a pilot project to evaluate open
pit mining in the Nome area. Under this method of mining, pay gravel is
removed during the winter months when the ground is frozen. It is then
processed the following summer after natural thawing has occurred. The
results of the initial project were inconclusive. Consequently, Alaska Gold
conducted a second test pit during the 1993-94 winter; processing of the stock
piled pay gravel from this pilot project confirmed that this method of mining
is viable. Therefore, the Company purchased additional equipment in 1994 to
conduct full scale open-pit mining operations which started in the fourth
quarter of 1994. Alaska Gold plans to move approximately 1.5 million cubic
yards of dirt in 1995, about three times as much as last year. Based on the
results of past exploratory drilling, Alaska Gold believes there may be
various areas available on its properties to sustain open pit mining for ten
years.
Coal Properties
In 1994, United States Fuel Company ("U.S. Fuel"), a wholly-owned
subsidiary of Arava, entered into an agreement to sell the majority of its
assets. The sale is expected to close in 1995 pending approval by regulatory
agencies and the completion of an environmental audit by the purchaser. The
sale is expected to result in a small gain. Prior to March 1993, U.S. Fuel
mined steam coal by the deep-mine process at its coal properties located in
Carbon and Emery Counties, Utah.
U.S. Fuel's coal properties include approximately 12,700 acres of which
approximately 10,000 acres are owned and 2,700 acres are leased. Following
the proposed sale, U.S. Fuel will own approximately 1,100 acres.
Other Natural Resources Properties
The Company also has interests in various mineral properties located in
nine states and Canada. None of these mineral properties are significant to
the Company's business, and may be sold, developed, or leased in the near
future. During 1992, the Company sold its copper mine and mill located in
Grant County, New Mexico.
Canco Oil & Gas Ltd. ("Canco"), a wholly-owned Canadian subsidiary, owns
petroleum and natural gas rights to approximately 30,000 net acres in
Saskatchewan, Canada. The Company has embarked upon a limited drilling
program to determine the development potential of these properties.
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In 1992, Ruby Hill Mining Company ("Ruby Hill") entered into a four-year
Exploration Agreement with Purchase Option (the "Exploration Agreement") with
Homestake Mining Company of California ("Homestake") for its property near
Eureka, Nevada. Homestake has a substantial exploration and drilling program
underway on the property. In 1994, Homestake exercised its option to purchase
the property; the total purchase price is $4 million payable over up to a six-
year period depending on timing of production decisions and commencement of
production. If Homestake produces a total of 500,000 ounces of gold or "gold
equivalents" of other metals from this property, Ruby Hill is thereafter
entitled to a three percent net smelter return royalty, after deduction for
certain taxes and transportation. Arava owns 81% of the stock of Richmond-
Eureka Mining Company, which owns 75% of the stock of Ruby Hill.
Labor Relations
The Company employs approximately 2,250 employees of which approximately
925 are represented by various unions. A majority of the unionized employees
are under contracts which expire in 1999.
Raw Material and Energy Availability
Adequate supplies of raw material are available to the Company.
Sufficient energy in the form of natural gas, fuel oils and electricity is
available to operate the Company's production facilities. While temporary
shortages of raw material and fuels may occur occasionally, they have not
materially hampered the Company's operations.
Environmental Matters
The Company is subject to various federal, state and local laws and
regulations relating to environmental quality. Compliance with these laws and
regulations is a matter of high priority for the Company's management, not
only with respect to existing operations and remediation of sites associated
with past operations, but also as an integral part of its planning for future
growth.
Mueller's provisions for compliance with federal, state and local laws
and regulations governing the discharge of materials into the environment, or
otherwise relating to the protection of the environment include $2.9 million
in 1994, and $1.1 million in 1993. Management believes that the outcome of
pending environmental matters will not materially affect the overall financial
position of the Company. Except as discussed below, the Company does not
anticipate that it will need to make material expenditures for such compliance
activities during the remainder of the 1995 fiscal year, or for the next two
fiscal years.
Michigan Settlement
On April 22, 1991, MBCo was named defendant in a private enforcement
action filed in the United States District Court, Eastern District of
Michigan. The suit alleged violations of the Clean Water Act related to
operations at MBCo's Port Huron, Michigan facility. Pursuant to a Consent
Decree, since 1992 MBCo has contributed $1.0 million towards environmental
mitigation projects in Michigan and paid cash penalties of approximately $1.0
million. Beginning in 1992, MBCo has initiated steps to eliminate all
potential pollution sources while undertaking a full site investigation into
possible contamination at its Port Huron facility. Total costs for these
activities were approximately $.3 million in 1994, $.5 million in 1993 and $.3
million in 1992. The Company believes MBCo's established reserves should be
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adequate to cover anticipated site investigation and remediation costs.
Alaska Gold
Alaska Gold requires water for its thawing and dredging operation at
Nome, Alaska and must comply with federal and state laws in connection with
the appropriation from and discharge into the Snake River. Such operations
are under the concurrent jurisdiction of the EPA and the State of Alaska
Department of Environmental Conservation ("ADEC"). Effective October 15,
1991, the State of Alaska established land reclamation standards and
obligations, and created a mandatory system for posting reclamation bonds.
Total cost related to reclamation activities are not expected to exceed
$125,000 for 1995 and 1996.
In 1994, Alaska Gold completed its site investigation and remediation
related to past mining operations in and around the old "gold house" in
Fairbanks. In 1994, Alaska Gold removed the soil to a landfill and received a
"No Further Action Required" letter from the ADEC indicating that the project
had been satisfactorily completed. Total cleanup costs were approximately
$425,000. The property was subsequently sold. In addition, Alaska Gold is
aware that the ADEC has proposed to use State funds to conduct a comprehensive
Phase I environmental assessment of contamination in an industrial area in
downtown Fairbanks. The Fairbanks properties referred to above are included
within this industrial area. The effect, if any, of this assessment on Alaska
Gold is unknown.
Mining Remedial Recovery Company
Pursuant to Sharon's plan of reorganization, the subsidiaries of Sharon
were realigned and certain stock and assets transferred to Mining Remedial
Recovery Company ("MRRC"), a wholly-owned subsidiary of Arava. MRRC was
formed for the purpose of managing the remediation of certain properties and
the appropriate disposition thereof including sites described below. In
addition to the stock of certain subsidiaries and certain other property, MRRC
was capitalized with a $7.85 million cash contribution. Pursuant to a finding
of the bankruptcy court, such cash contribution together with the other assets
contributed to MRRC constituted adequate capitalization of MRRC (See
"Reorganization Under Chapter 11 of the Bankruptcy Code" below). MRRC has
instituted efforts to recover expenditures from insurance companies and third
parties that allegedly contributed to the environmental conditions requiring
remediation. It appears that MRRC will be up to a few million dollars short
of having sufficient funds to complete remediation at all its sites, due to
cost overruns, unanticipated expenditures, and changing environmental
regulations that, in some cases, have increased the costs of remediation,
absent loans and advances from the Company and/or some recoveries from
insurance companies, third parties or the sale of assets. MRRC cannot
reasonably estimate the timing or amount of such proceeds. If any more of
MRRC's sites are included on CERCLA's National Priorities List (see discussion
below), MRRC's legal and, perhaps, remediation costs, would be likely to
increase.
1. Cleveland Mill Site
On November 24, 1993, the EPA issued Special Notice letters to all known
potentially responsible parties ("PRPs") regarding the Cleveland Mill
Superfund Site in Grant County, New Mexico. In response to the Special
Notice, MRRC, Bayard Mining Corp. ("Bayard"), a wholly-owned subsidiary of
Arava, and another third party affiliated with a former owner/operator of the
site, filed a good faith offer to implement the remedy set forth in the EPA's
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Record of Decision ("ROD") issued in September, 1993. Total costs for
remediating the site are uncertain, but were estimated by the EPA in the ROD
at approximately $6.2 million in addition to the $1.2 million previously
incurred by the EPA at the site. During the third quarter of 1994, MRRC and
Bayard, along with said third party, executed a consent decree relating to the
site. The consent decree has yet to be executed by the governmental entities
or entered by the federal district court, which is anticipated to occur in
1995. MRRC, Bayard and said third party have agreed to an allocation formula
at this site which will (i) require Bayard and MRRC to pay 33.33% of past
response costs, and (ii) require Bayard and MRRC to pay 29.20% of future
costs. The third party will pay the remaining costs. Mueller has guaranteed
Bayard's and MRRC's payment obligations under this allocation agreement. The
site is currently owned by MRRC and Bayard.
2. Hanover and Bullfrog Sites
MRRC is the current owner of 80 acres located in Grant County, New
Mexico called the Hanover site. About 2.7 million cubic yards of mill
tailings are concentrated in several sites on the property. No PRP Notices
have been received from the United States under CERCLA, although New Mexico
authorities have done a study of the Hanover site to possibly include the site
within a much larger area, called the Central Mining District, to be proposed
for CERCLA's National Priorities List. Costs associated with capping the
tailings on site and regrading the soil are estimated at approximately $1.0
million. MRRC and the same third party involved in the Cleveland Mill site
have agreed that said third party will pay for 62.50% of all costs incurred
since July 8, 1994, and MRRC will pay 37.50% of such costs, except that should
such costs exceed $1.0 million, MRRC will pay all costs in excess of $1.0
million to complete voluntary remediation, unless completion is prevented or
hindered by a third party. Mueller will guarantee MRRC's performance under
this allocation agreement. MRRC is also the current owner of 148 acres
located nearby also in Grant County, New Mexico, called the Bullfrog site.
During 1994, MRRC substantially completed its voluntary plan to regrade and
cap the soil at the Bullfrog site. Costs associated with capping and
regrading the site were approximately $0.9 million.
3. Mammoth Mine Site
MRRC owns title to some mines in Shasta County, California, which have
been inactive since the 1920s. Since acquiring title, MRRC has continued a
program begun in the late 1980s of sealing mine portals with concrete plugs in
mine adits which were discharging water. While the sealing program has
achieved over a 90% reduction in the metal load in discharges from these
adits, historically the thresholds identified in MRRC's National Pollutant
Discharge Elimination System Permit No. 81876 have not at all times been met.
To date, MRRC has expended in excess of $1.75 million in implementing the
sealing program, and has installed plugs at all adits that were discharging.
MRRC intends to cooperate with governmental authorities in completing its
bulkhead construction, rehabilitation and monitoring portions of the sealing
program. In addition, the EPA and California Bureau of Water Quality have
recently commissioned a study concerning the historic mine waste in the area,
some of which is on MRRC property. Whether or not, following the completion
of this study and its results, the regulatory agencies will require any
reclamation of mine waste dumps is unknown.
On October 14, 1994, MRRC received Notice of a Compliant filed against
it in the United States District Court for the Eastern District of California.
The action is a citizens suit brought under the authority of the Clean Water
Act by the California Sportfishing Protection Alliance (the "Alliance"). The
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plaintiff's complaint alleges several instances of acid mine drainage and
discharges from mine adits from property owned by MRRC in Shasta County,
California. The plaintiffs allege that these activities are in violation of
MRRC's National Pollutant Discharge Elimination System Permit. MRRC has filed
its answer denying liability and raising various affirmative defenses. MRRC
has also met with the Alliance to discuss resolving this matter outside of
litigation. In January, 1995, MRRC and the Company each received a letter
from counsel representing another mining company, notifying MRRC and the
Company of alleged potential liability under various federal and state laws
for contamination of water in Shasta County, California, caused by releases of
hazardous substances from inactive mines in the form of acid mine drainage.
The Company and MRRC have replied that they do not intend to contribute to
abatement costs at nearby mines, although MRRC, as a mine owner, has also
indicated a willingness to cooperate with all parties to achieve a broader
remediation in this area.
4. U.S.S. Lead
U.S.S. Lead Refinery, Inc. ("Lead Refinery") is a subsidiary of MRRC.
In 1991, Lead Refinery executed two partial Interim Agreed Orders (the
"Orders"), to settle two administrative enforcement cases, in which the State
of Indiana alleged that Lead Refinery violated (i) certain solid waste
management, storage and disposal provisions under state law; and (ii) certain
water discharge provisions that limit the amount of lead that may be
discharged into waters adjacent to the Lead Refinery facility. Two other
appeals filed by Lead Refinery challenging the State's permitting and waste
management actions, which relate to the two enforcement cases, were deferred
pending implementation of the Orders.
Pursuant to the Orders, Lead Refinery submitted a closure plan for the
site. In phase 1 of 4 of the closure plan, Lead Refinery removed flue dust
and calcium sulfate piles from the site. A certification for closure for
phase 1 was submitted to the State of Indiana. Lead Refinery also submitted a
site assessment plan as phase 2 of the closure plan. As discussed below, the
State of Indiana has deferred consideration of the site assessment plan as a
result of the execution of a corrective action order between the EPA and Lead
Refinery. The appropriateness of imposing any civil penalties on Lead
Refinery has been deferred pending implementation of the Orders.
On May 17, 1985, the U.S. Department of Justice, on behalf of the EPA,
filed a complaint against Lead Refinery in the U.S. District Court for the
Northern District of Indiana, alleging that Lead Refinery violated the Federal
Clean Water Act by exceeding certain discharge limitations of Lead Refinery's
NPDES water discharge permit. On May 28, 1991, the parties signed a consent
decree whereby Lead Refinery agreed to pay a civil penalty of $40,000 within
one year, with an additional $15,000 depending on resumption of operations or
sale of the property, and to cover all existing baghouse dust and calcium
sulfate waste piles at the facility.
In February, 1991, Lead Refinery received a request from EPA under
Superfund for information on whether Lead Refinery arranged for the disposal
of hazardous substances at a site located in Pedricktown, New Jersey. Lead
Refinery provided information responsive to EPA's request. Lead Refinery has
been informed by the former owner and operator that it intends to seek CERCLA
response costs for alleged shipments of hazardous substances to the
Pedricktown Superfund site. Lead Refinery has executed a tolling agreement
with the former owner/operator regarding the Pedricktown site, which extends
the statute of limitations, until such time as either party gives notice of
termination of the agreement. There have been no communications from the
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former owner/operator since the execution of the tolling agreement in late
1989. In April, 1991, Lead Refinery also received a request from EPA under
Superfund for information on whether Lead Refinery arranged for the disposal
of hazardous substances in the vicinity of the Grand Calumet River/Indiana
Harbor Ship Canal. Lead Refinery responded to that information request. In
September 1991, EPA requested information under Superfund regarding the Lead
Refinery site in East Chicago, Indiana. Lead Refinery also submitted a
response to that request. In February, 1992, EPA advised Lead Refinery of its
intent to list the property as a Superfund site. Lead Refinery filed a
written response opposing such listing and, as of March 1, 1995, EPA has
deferred such listing.
In September, 1993, Lead Refinery signed a negotiated Administrative
Order on Consent (the "Consent Order") with the EPA Region V pursuant to
Section 3008(h) of the Resource Conservation and Recovery Act ("RCRA"). The
Consent Order, which the EPA executed in November, 1993, covers remediation
activities at the site in East Chicago, Indiana. The Consent Order provides
for Lead Refinery to complete certain on-site interim remedial activities and
studies that extend off site. Lead Refinery has submitted certain workplans
to implement the remedial activities and is awaiting approval from EPA to
commence the required corrective actions. The costs for the studies and
interim clean up efforts are expected to be between $2.0 million and $2.5
million, the majority of which would be required to be expended in 1995. Once
these activities are completed, additional work would likely be needed to
remediate any contamination not addressed by the Consent Order. Lead Refinery
lacks the financial resources needed to complete the additional remediation
and intends to seek financial assistance from other PRPs to permit Lead
Refinery to conduct a private-party cleanup under RCRA.
Lead Refinery has also received an administrative order from EPA to
perform response actions under Superfund with respect to a site located in
Granite City, Illinois. It is the position of Lead Refinery that it did not
arrange for the disposal of hazardous substances at that site. In August,
1991, the U.S. Department of Justice, on behalf of the EPA, filed suit against
several owners and operators of the site and numerous alleged generators of
substances at the site. Lead Refinery was not named as a defendant in that
lawsuit.
By letter dated June 23, 1992, the EPA informed Lead Refinery that
it is a responsible party under Superfund for the H. Brown site, located in
Walker, Michigan, and invited Lead Refinery to execute a de minimus settlement
agreement with the agency. By letter dated August 3, 1992, Lead Refinery
declined to execute the de minimus settlement agreement.
By letter dated September 28, 1994, EPA informed Lead Refinery that it
is a PRP at the Conservation Chemical Company site located in Gary, Indiana.
In November, 1994, representatives from Lead Refinery attended a meeting
between the EPA and numerous PRPs to discuss the agency's demands regarding
cleanup of the Conservation Chemical Company site and reimbursement of past
response costs (approximately $2.8 million through March, 1993). EPA
indicated that it would prepare and transmit an administrative settlement
proposal to the PRPs, seeking reimbursement of past response costs and cleanup
of the site. No proposal has yet been received. Lead Refinery has been
invited to join a de minimus PRP committee, but has not yet done so.
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Miscellaneous
In April, 1992, Mueller received a notice from the State of Indiana,
addressed to Sharon c/o Mueller, notifying Sharon that it had sixty days to
coordinate with other potentially responsible parties ("PRPs") and present a
"good faith" proposal to the State regarding a site in Indiana. Sharon is one
of nearly two hundred PRPs at a site in Indiana due to disposal of electric
arc furnace dust and solvents. Sharon is alleged to have contributed less
than 1% of the hazardous wastes at this site. On January 26, 1994, Mueller
submitted a proposal to join the PRP Site Participation Agreement along with
an addendum preserving its defenses as successor to Sharon, including among
other things, Sharon's prior release and discharge in the Bankruptcy Court and
the assumption of the Designated Steel Liabilities as more fully set forth in
Sharon's Reorganization Plan and the Purchase Agreement and related Documents.
(See "Reorganization Under Chapter 11 of the Bankruptcy Code, Disposition of
the Steel Business" below.) Based upon Sharon's estimated allocated share of
liability and estimated total response costs, Mueller's response liability in
this matter is estimated at less than $250,000.
In November, 1992, Mueller was added as one of more than one hundred
third-party defendants to a complaint filed by the Government in 1990 pursuant
to CERCLA against 26 corporations alleged to have disposed of hazardous
materials at a site in Pennsylvania. Mueller was not required to file an
answer and was deemed automatically to have denied any liability. Based on
preliminary site clean-up costs and the number of PRPs involved in this site,
the Company estimates that its allocated share will be less than $100,000.
Disposition of the complaint is scheduled to go forward in 1995. Mueller has
joined a de minimus joint defense group which is pursuing a settlement
involving the payment of a nominal amount by each member of the group.
On August 26, 1993, the EPA served notice to MBCo that it is one of 70
PRPs in the Stoller Chemical Company Site investigation in Jericho, South
Carolina. In response to the notice, MBCo filed its response to the EPA's
information request in a timely manner and joined a PRP steering committee
which was formed to coordinate response activities. On January 21, 1994, the
EPA issued a Unilateral Administrative Order pursuant to Section 106(a) of
CERCLA setting forth scheduled response activities to be undertaken by the
PRPs. Preliminary total estimated costs of remediation at this site are $5
million and the Company does not anticipate that MBCo's allocated share of
costs will be material.
On March 7, 1994, the Company received notice from the EPA that MBCo was
a PRP at the Jack's Creek/Sitkin Smelting Superfund Site in Eastern
Pennsylvania. The site is a former smelting facility which received materials
from MBCo in the 1970s. MBCo is one of seventy-five de maximus PRPs and is
alleged to have contributed less than 1 percent of the hazardous wastes at
this site. Approximately 470 de minimus PRPs are also included in the
investigation. The EPA has advised that its estimated cleanup costs would be
approximately $40 million. Additionally, the EPA has already incurred
response costs of $5.0 million. Based upon MBCo.'s estimated allocation
ranking, its share of costs would be approximately $400,000.
In October, 1986, the EPA notified Sharon that it may be
considered a PRP with respect to allegedly hazardous wastes released from past
mining operations conducted by UV Industries, Inc. ("UV") in Cherokee County,
Kansas. The EPA asserted that under CERCLA, Sharon was potentially
responsible for the cost of investigation, clean-up and remediation of the
wastes allegedly deposited circa 1917 during leasehold operations conducted by
UV. Sharon denied liability under CERCLA on the grounds that it was neither
13
the owner nor operator when allegedly hazardous substances were being disposed
of at the site and for the reason that UV's leasehold interest had expired
prior to the time that Sharon acquired UV's assets. Mueller has never been
contacted concerning this site and does not know the estimated costs of
remediation of this site.
Other Business Factors
The Registrant's business is not materially dependent on patents,
trademarks, licenses, franchises or concessions held. In addition,
expenditures for company-sponsored research and development activities were
not material during 1994, 1993, or 1992. No material portion of the
Registrant's business involves governmental contracts.
Reorganization Under Chapter 11 of the Bankruptcy Code
Reference is made to "Reorganization Under Chapter 11 of the Bankruptcy
Code" in Item 3 of this Report, which is incorporated herein by reference, for
a description of Sharon's voluntary petition for relief filed under Chapter 11
of the Bankruptcy Code on April 17, 1987.
ITEM 2. PROPERTIES
Information pertaining to the Registrant's major operating facilities is
included below (some additional information is also included under "Business"
in Item 1, which is incorporated herein by reference). Except as noted, the
Registrant owns all of its principal properties. The Registrant's plants are
in satisfactory condition and are suitable for the purpose for which they were
designed and are now being used.
Location Property Size Description
Port Huron, MI 260,000 sq. ft. (1) Brass rod mill. Facility includes
23.19 acres casting, extruding, and finishing
equipment to produce brass rods
and bars, in various shapes and
sizes.
Port Huron, MI 46,500 sq. ft. Forgings plant. Produces brass
and aluminum forgings.
Marysville, MI 62,500 sq. ft. Aluminum and Copper Impacts plant.
6.72 acres Produces made to order parts using
cold impact processes.
Port Huron, MI 13,500 sq. ft. Formed tube plant.
5.11 acres Produces copper fittings using
cold heading equipment.
Fulton, MS 405,500 sq. ft. (1) Copper tube mill.
60.70 acres Facility includes casting,
extruding and finishing equipment
to produce copper tubing,
including tube feed stock for the
Company's copper fittings plants.
14
Fulton, MS 70,500 sq. ft. (1) (2) Copper fittings plant. High-
volume facility is being
constructed to produce copper
fittings using tube feed stock
from the Company's copper tube
mill beginning in 1995.
Covington, TN 159,500 sq. ft. Copper fittings plant.
40.88 acres Facility produces copper fittings
using tube feed stock from the
Company's copper tube mill.
Strathroy, Ontario
Canada 54,000 sq. ft. Copper fittings plant.
4.67 acres Facility produces copper fittings
for the Canadian domestic markets
and for export to European
markets.
Upper Sandusky, OH 82,000 sq. ft. Plastic fittings plant.
7.52 acres Produces DWV fittings using
injection molding equipment.
Kalamazoo, MI 130,000 sq. ft. (2) Plastic fittings plant. Produces
DWV fittings using injection
molding equipment.
Cerritos, CA 115,000 sq. ft. (2) Plastic fittings plant. Produces
DWV fittings using injection
molding equipment.
Hartsville, TN 78,000 sq. ft. Refrigeration Products plant.
4.51 acres Produces products used in
refrigeration applications such as
ball valves, line valves,
compressor valves, and filter
driers.
In addition, the Company owns and/or leases other properties used as
distribution centers and corporate offices.
(1) Includes facility expansion to be complete and operational in
latter half of 1995.
(2) Facility is leased under long-term lease agreement, with option to
purchase.
ITEM 3. LEGAL PROCEEDINGS
Canco Litigation
In 1989, Canco instituted litigation in Saskatchewan contending that
Canco's royalty interests continued against mineral titles transferred to the
Government of Saskatchewan (the "Government") and Scurry Rainbow Oil Limited
("Scurry") or, alternatively, that Scurry had breached its contractual
obligations to Canco. In 1991, Canco instituted another lawsuit against the
Government. In 1994, these lawsuits were settled. As part of this
settlement, Canco sold its oil and gas royalty interests. The Company
recognized a gain of approximately $.6 million as a result of the settlement.
15
Reorganization Under Chapter 11 of the Bankruptcy Code
On April 17, 1987, Sharon Steel Corporation ("Sharon") filed a voluntary
petition for relief under Chapter 11 of the Bankruptcy Code in the United
States Bankruptcy Court for the Western District of Pennsylvania, Erie
Division (the "Bankruptcy Court"), and was assigned Case No. 87-00207E. On
November 21, 1990, the Bankruptcy Court confirmed a plan of reorganization
(the "Reorganization Plan"). The Reorganization Plan, filed as Exhibit 2.1,
is incorporated by reference in its entirety herein, and the summary of the
Reorganization Plan set forth below is qualified in its entirety by reference
thereto. The Reorganization Plan was consummated on December 28, 1990 (the
"Consummation Date"). Upon consummation, Mueller became a successor to Sharon
for purposes of the Bankruptcy Code, and assumed the reporting obligations of
Sharon under Section 12 of the Securities Exchange Act of 1934.
Pursuant to the Reorganization Plan, on the Consummation Date, Sharon
sold its steel business to Sharon Specialty Steel, Inc., a Delaware
corporation, pursuant to an Asset Purchase Agreement filed as Exhibit 2.3, and
was reorganized under Chapter 11 of the Bankruptcy Code through a
recapitalization of the remaining non-steel businesses (consisting primarily
of the copper and brass fabrication business and Sharon's natural resources
operations) into a holding company structure.
Pursuant to the Reorganization Plan, Mueller issued 10,000,000 shares of
its common stock, par value $.01 per share ("Common Stock"), and $25,000,000
aggregate principal amount of its Delayed Distribution Notes (the "Delayed
Distribution Notes"). On March 25, 1991, Mueller prepaid in full the Delayed
Distribution Notes. As of March 1, 1995, all disputed claims were resolved
and the final pro rate distributions were paid.
Environmental Proceedings
Reference is made to "Environmental Matters" in Item 1 of this Report,
which is incorporated herein by reference, for a description of environmental
proceedings.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED
STOCKHOLDER MATTERS
The information required by Item 5 of this Report is included under the
caption "Capital Stock Information" on page 36 of the Registrant's Annual
Report to Stockholders for the year ended December 31, 1994, which information
is incorporated herein by reference.
ITEM 6. SELECTED FINANCIAL DATA
Selected financial data are included under the caption "Selected
Financial Data" on page 37 of the Registrant's Annual Report to Stockholders
for the year ended December 31, 1994, which selected financial data is
incorporated herein by reference.
16
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Management's discussion and analysis of financial condition and results
of operations is contained under the caption "Financial Review" on pages 8
through 12 of the Registrant's Annual Report to Stockholders for the year ended
December 31, 1994 and is incorporated herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
See Index to Financial Statements and Supplemental Financial Information
on pages 22 and 23 of this Annual Report on Form 10-K which is incorporated
herein by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information required by Item 10 is contained under the caption
"Ownership of Common Stock by Directors and Officers and Information about
Director Nominees" in the Company's Proxy Statement for its 1995 Annual
Meeting of Stockholders to be filed with the Securities and Exchange
Commission on or about March 17, 1995 and is incorporated herein by reference.
ITEM 11. EXECUTIVE COMPENSATION
The information required by Item 11 is contained under the caption
"Executive Compensation" in the Company's Proxy Statement for its 1995 Annual
Meeting of Stockholders to be filed with the Securities and Exchange
Commission on or about March 17, 1995 and is incorporated herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information required by Item 12 is contained under the captions
"Principal Stockholders" and "Ownership of Common Stock by Directors and
Officers and Information about Director Nominees" in the Company's Proxy
Statement for its 1995 Annual Meeting of Stockholders to be filed with the
Securities and Exchange Commission on or about March 17, 1995 and is
incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information required by Item 13 is contained under the caption
"Certain Relationships and Transactions with Management" in the Company's
Proxy Statement for its 1995 Annual Meeting of Stockholders to be filed with
the Securities and Exchange Commission on or about March 17, 1995 and is
incorporated herein by reference.
17
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES, AND REPORTS ON FORM
8-K
(a) The following documents are filed as part of this report:
1. Financial Statements: the financial statements, notes, and report of
independent auditors described in item 8 of this report, which are
incorporated by reference.
2. Financial Statement Schedules: the financial statement schedules, if
any, described in Item 8 of this report which are incorporated herein by
reference.
3. Exhibits:
2.1 (i) Third Amended and Restated Plan of Reorganization for
Sharon Steel Corporation dated September 27, 1990, proposed by
Quantum Overseas, N.V. and Castle Harlan, Inc. (Incorporated
herein by reference to Exhibit 2.1 of the Registrant's Current
Report on Form 8-K dated December 28, 1990), and (ii) Motion of
Quantum Overseas, N.V. and Castle Harlan, Inc. pursuant to 11
U.S.C. 1127(a) and Bankruptcy Rule 3019 for an Order approving
modification of such plan (as so modified, the "Plan")
(Incorporated herein by reference to Exhibit 2.2 of the
Registrant's Current Report on Form 8-K dated December 28, 1990).
2.2 Order of the Bankruptcy Court confirming the Plan, dated
November 20, 1990, entered by the Bankruptcy Court on November 21,
1990 (Incorporated herein by reference to Exhibit 2.3 of the
Registrant's Current Report on Form 8-K dated December 28, 1990).
2.3 Asset Purchase Agreement, dated as of December 28, 1990, by and
among Sharon, Inc., Franklin E. Agnew III, as Chapter 11 trustee,
and Sharon Steel Corporation (which was merged with and into
Mueller Industries, Inc.) (Incorporated herein by reference to
Exhibit 2.5 of the Registrant's Current Report on Form 8-K dated
December 28, 1990).
3.1 Certificate of Incorporation of Mueller Industries, Inc. and
all amendments thereto (Incorporated herein by reference to
Exhibit 3.1 of the Registrant's Current Report on Form 8-K dated
December 28, 1990).
3.2 By-laws of Mueller Industries, Inc., as amended and restated,
effective November 10, 1994. (Incorporated herein by reference to
Exhibit 3 (ii) of the Registrant's Current Report on Form 8-K,
dated November 14, 1994.)
4.1 Common Stock Specimen (Incorporated herein by reference to
Exhibit 4.1 of the Registrant's Current Report on Form 8-K dated
December 28, 1990).
18
4.2 Certain instruments with respect to long-term debt of the
Company have not been filed as Exhibits to the Report since the
total amount of securities authorized under any such instrument
does not exceed 10 percent of the total assets of the Company and
its subsidiaries on a consolidated basis. The Company agrees to
furnish a copy of each such instrument upon request of the
Securities and Exchange Commission.
10.1 Agreement Regarding Retiree Obligation, dated as of December
28, 1990, made by Sharon Steel Corporation (which was merged with
and into Mueller Industries, Inc.) in favor of Sharon's retiree
plans referred to therein (Incorporated herein by reference to
Exhibit 10.2 of the Registrant's Report on Form 10-K, dated March
29, 1991, for the year ended December 31, 1990).
10.2 Pension Plan Contribution Agreement, dated as of December 28,
1990, by and among Sharon, Inc., Mueller Industries, Inc. and
Sharon Steel Corporation (which was merged with and into Mueller
Industries, Inc.) (Incorporated herein by reference to Exhibit
10.3 of the Registrant's Report on Form 10-K, dated March 29,
1991, for the year ended December 31, 1990).
10.3 Employment Agreement, effective October 1, 1991 by and between
Mueller Industries, Inc. and Harvey L. Karp (Incorporated herein
by reference to Exhibit 10.3 of the Registrant's Current Report on
Form 8-K dated November 22, 1991).
10.4 Stock Option Agreement, dated December 4, 1991 by and between
Mueller Industries, Inc. and Harvey L. Karp (Incorporated herein
by reference to Exhibit 10.4 of the Registrant's Current Report on
Form 8-K dated November 22, 1991).
10.5 Employment Agreement, effective November 26, 1991 by and
between Mueller Industries, Inc. and William H. Hensley
(Incorporated herein by reference to Exhibit 10.6 of the
Registrant's Current Report on Form 8-K dated November 22, 1991).
10.6 Mueller Industries, Inc. 1991 Employee Stock Purchase Plan
(Incorporated herein by reference to Exhibit 4(a) of the
Registrant's Registration Statement on Form S-8 dated June 28,
1991).
10.7 Mueller Industries, Inc. 1991 Incentive Stock Option Plan
(Incorporated herein by reference to Exhibit 4(a) of the
Registrant's Registration Statement on Form S-8 dated April 17,
1992).
10.8 Employment Agreement, effective June 3, 1992 by and between
Mueller Industries, Inc. and William D. O'Hagan (Incorporated
herein by reference to Exhibit 10.1 of the Registrant's Current
Report on Form 8-K dated June 3, 1992).
10.9 Summary description of the Registrant's 1995 bonus plan for
certain key employees.
19
10.10 Amendment to Employment Agreement, effective January 1, 1994,
to Employment Agreement by and between Mueller Industries, Inc.
and Harvey L. Karp. (Incorporated herein by reference to Exhibit
10.28 of the Registrant's Report on Form 10-K, dated March 23,
1994, for the fiscal year ended December 25, 1993.)
10.11 Employment Agreement, effective as of January 1, 1994, by and
between Mueller Industries, Inc. and William D. O'Hagan.
(Incorporated herein by reference to Exhibit 10.29 of the
Registrant's Report on Form 10-K, dated March 23, 1994, for the
fiscal year ended December 25, 1993.)
10.12 Amendment to Employment agreement, effective as of July 23,
1993, by and between Mueller Industries, Inc. and William H.
Hensley. (Incorporated herein by reference to Exhibit 10.30 of
the Registrant's Report on Form 10-K, dated March 23, 1994, for
the fiscal year ended December 25, 1993.)
10.13 Mueller Industries, Inc. 1994 Stock Option Plan.
10.14 Mueller Industries, Inc. 1994 Non-Employee Director Stock
Option Plan.
13.0 Mueller Industries, Inc.'s Annual Report to Shareholders for
the year ended December 31, 1994. Such report, except to the
extent incorporated herein by reference, is being furnished for
the information of the Securities and Exchange Commission only and
is not to be deemed filed as a part of this Annual Report on Form
10-K.
21.0 Subsidiaries of the Registrant.
23.0 Consent of Independent Auditor. (Includes report on
Supplemental Financial Information.)
99.1 Consent Decree, dated February 25, 1992, entered into by and
among Mueller Brass Co., the State of Michigan, and PIRGIM Public
Interest Lobby. (Incorporated herein by reference to Exhibit
28.23 of the Registrant's Annual Report on Form 10-K, dated March
25, 1992, for the year ended December 28, 1991.)
99.2 Rights Agreement, dated as of November 10, 1994, between the
Registrant and Continental Stock Transfer and Trust Company, as
Rights Agent, which includes the Form of Certificate of
Designation, Preferences and Rights of Series A Junior
Participating Preferred Stock of the Registrant, as Exhibit A, the
Form of Rights Certificate, as Exhibit B, and the Summary of
Rights to Purchase Preferred Stock, as Exhibit C. (Incorporated
by reference to Exhibit 99.1 of the Registrant's Current Report on
Form 8-K, dated November 14, 1994.)
20
(b) During the three months ended December 31, 1994, the following
Current Reports on Form 8-K were filed:
(i) Current Report on Form 8-K, dated November 10, 1994,
which reported (i) the adoption of a shareholder rights plan,
and (ii) the amendment of the Company's By-Laws implementing
procedures for stockholder proposals and for nominations for
election of directors to be considered at annual or special
meetings.
21
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, on March 17,
1995.
MUELLER INDUSTRIES, INC.
/s/ HARVEY L. KARP
Harvey L. Karp, Chairman of the Board
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the date indicated.
Signature Title Date
/S/HARVEY L. KARP Chairman of the Board, and Director March 17, 1995
Harvey L. Karp
/S/ROBERT B. HODES Director March 17, 1995
Robert B. Hodes
Director March __, 1995
Allan Mactier
/S/WILLIAM D. O'HAGAN President, Chief Executive Officer, March 17, 1995
William D. O'Hagan Director
/S/ROBERT J. PASQUARELLI Director March 17, 1995
Robert J. Pasquarelli
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following person on behalf of the
Registrant and in the capacities and on the date indicated.
Signature and Title Date
/S/EARL W. BUNKERS March 17, 1995
Earl W. Bunkers
Chief Financial Officer
(Principal Accounting Officer)
/S/KENT A. MCKEE March 17, 1995
Kent A. McKee
Treasurer and Assistant Secretary
/S/ROY C. HARRIS March 17, 1995
Roy C. Harris
Corporate Controller
22
INDEX TO FINANCIAL STATEMENTS
The consolidated financial statements, together with the report thereon
of Ernst & Young LLP dated February 8, 1995, appearing on page 13 through and
including 35, of the Company's 1994 Annual Report to Stockholders are
incorporated by reference in this Annual Report on Form 10-K. With the
exception of the aforementioned information, no other information appearing in
the 1994 Annual Report to Stockholders is deemed to be filed as part of this
Annual Report on Form 10-K under Item 8. The following Consolidated Financial
Statement Schedule should be read in conjunction with the consolidated
financial statements in such 1994 Annual Report to Stockholders. Consolidated
Financial Statement Schedules not included with this Annual Report on Form 10-
K have been omitted because they are not applicable or the required
information is shown in the consolidated financial statements or notes
thereto.
SUPPLEMENTAL FINANCIAL INFORMATION
Page
Schedule for the fiscal years ended December 31, 1994,
December 25, 1993, and December 26, 1992.
Valuation and Qualifying Accounts (Schedule II) 23
23
MUELLER INDUSTRIES, INC.
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
Years Ended December 31, 1994, December 25, 1993, and December 26, 1992
(In thousands)
Additions
-------------------------------
Balance at Charged to Balance
beginning costs and Other at end
of Year expenses Additions Deductions of year
------------ ------------ ----------- ----------- -----------
1994
Allowance for Doubtful Accounts $ 3,495 $ 186 $ - $ 345 $ 3,336
Environmental Reserves (1) $ 10,448 $ 2,914 $ 125 (2) $ 2,309 $ 11,178
Other Reserves (1) (3) $ 15,508 $ 4,062 $ (125) (2) $ 3,295 $ 16,150
Valuation Allowance for Deferred
Tax Assets $ 85,338 $ - $ - $ 19,411 $ 65,927
1993
Allowance for Doubtful Accounts $ 4,473 $ 59 $ - $ 1,037 $ 3,495
Environmental Reserves (1) $ 10,985 $ 1,060 $ 1,000 (2) $ 2,597 $ 10,448
Other Reserves (1) (3) $ 18,317 $ (363) $ (1,000) (2) $ 1,446 $ 15,508
Valuation Allowance for Deferred
Tax Assets $ 88,081 $ - $ - $ 2,743 $ 85,338
1992
Allowance for Doubtful Accounts $ 6,925 $ 2,794 $ - $ 5,246 $ 4,473
Environmental Reserves (1) $ 13.258 $ 253 $ 2,500 (4) $ 5,026 $ 10,985
Other Reserves (1) (3) $ 33,144 $ 8,867 $ (2,500) (4) $ 21,194 $ 18,317
Valuation Allowance for Deferred
Tax Assets $ - $ - $ 88,081 (5) $ - $ 88,081
<FN>
(1) Of the amounts previously classified as Restructuring Reserves, $1.8 million
was reclassified to Environmental Reserves, the remainder was reclassified
to Other Reserves.
(2) Reclass from Other Reserves to Environmental Reserves.
(3) Other Reserves are included in the balance sheet captions Other
Current Liabilities and Other Noncurrent Liabilities
(4) US Fuel Reclamation reserve classified as Other Reserve in 1991,
Environmental Reserve in 1992
(5) Valuation reserve for certain income tax attributes that remain unrecognized. The amount
results from the adoption of SFAS No. 109 as of the beginning of 1992.
24
EXHIBIT INDEX
Exhibits Description Page
4.2 Certain instruments with respect to long-term debt
of the Company have not been filed as Exhibits to the
Report since the total amount of securities authorized
under any such instrument does not exceed 10 percent
of the total assets of the company and its subsidiaries
on a consolidated basis. The Company agrees to furnish
a copy of each such instrument upon request of the
Securities and Exchange Commission.
10.9 Summary description of the Registrant's 1995 bonus plan
for certain key employees.
10.13 Mueller Industries, Inc. 1994 Stock Option Plan.
10.14 Mueller Industries, Inc. 1994 Non-Employee Director
Stock Option Plan.
13.0 Mueller Industries, Inc.'s Annual Report to
Stockholders for the year ended December 31, 1994.
Such report, except to the extent incorporated herein by
reference, is being furnished for the information of
the Securities and Exchange Commission only and is not to
be deemed filed as a part of this Annual Report on
Form 10-K.
21.0 Subsidiaries of the Registrant.
23.0 Consent of Independent Auditor. (Includes report on
Supplemental Financial Information.)