-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
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 NO. 1-3053
CHAMPION INTERNATIONAL CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
NEW YORK 13-1427390
(STATE OF INCORPORATION) (I.R.S. EMPLOYER IDENTIFICATION NO.)
ONE CHAMPION PLAZA 06921
STAMFORD, CONNECTICUT (ZIP CODE)
(ADDRESS OF PRINCIPAL EXECUTIVE
OFFICES)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (203) 358-7000
SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
NAME OF EACH EXCHANGE
TITLE OF EACH CLASS ON WHICH REGISTERED
------------------- -----------------------
COMMON STOCK, $.50 PAR VALUE NEW YORK STOCK EXCHANGE
4 7/8% CONVERTIBLE SUBORDINATED NEW YORK STOCK EXCHANGE
DEBENTURES DUE APRIL 1, 1997
6 1/2% CONVERTIBLE SUBORDINATED NEW YORK STOCK EXCHANGE
DEBENTURES DUE APRIL 15, 2011
SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT: NONE
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 10-K. [X]
THE AGGREGATE MARKET VALUE OF VOTING STOCK HELD BY NON-AFFILIATES OF THE
REGISTRANT AS OF FEBRUARY 28, 1995 WAS APPROXIMATELY $4,160,000,000.
AS OF FEBRUARY 28, 1995, 93,408,849 SHARES OF COMMON STOCK OF THE REGISTRANT
WERE OUTSTANDING.
PORTIONS OF THE REGISTRANT'S ANNUAL REPORT TO SHAREHOLDERS FOR THE FISCAL
YEAR ENDED DECEMBER 31, 1994 ARE INCORPORATED BY REFERENCE IN PARTS I, II AND
IV HEREOF. PORTIONS OF THE REGISTRANT'S DEFINITIVE PROXY STATEMENT FOR THE
ANNUAL MEETING OF SHAREHOLDERS SCHEDULED TO BE HELD ON MAY 18, 1995 ARE
INCORPORATED BY REFERENCE IN PART III HEREOF.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PART I
ITEM 1. BUSINESS
GENERAL
Champion International Corporation was incorporated under the laws of the
State of New York on April 28, 1937. References to the "Company" include
Champion International Corporation and its subsidiaries at December 31, 1994,
unless the context otherwise requires.
The Company is one of the leading domestic manufacturers of paper for
business communications, commercial printing, publications and newspapers. In
addition, the Company has significant plywood and lumber manufacturing
operations and owns or controls approximately 5,070,000 acres of timberlands in
the United States. The Company's Canadian and Brazilian subsidiaries also own
or control significant timber resources supporting their operations.
The Company's business segments are paper and wood products. See Note 14 of
Notes to Financial Statements on pages 37 and 38 of the Company's Annual Report
to Shareholders for the fiscal year ended December 31, 1994 (the "Company's 1994
Annual Report"), which Note is incorporated by reference herein, for information
concerning the Company's business segments and operations in different
geographic areas for 1992, 1993 and 1994.
PAPER
See the Net Sales table on page 18 of the Company's 1994 Annual Report, which
table is incorporated by reference herein, for information concerning the net
sales to unaffiliated customers of the various products of the paper business
for 1992, 1993 and 1994.
PRINTING AND WRITING PAPERS
The printing and writing papers business manufactures and sells printing and
writing papers, bleached paperboard and pulp. The principal domestic
manufacturing properties of this operation consist of integrated pulp and paper
mills at Courtland, Alabama; Canton, North Carolina; and Pensacola, Florida; and
a paper mill at Hamilton, Ohio. As of December 31, 1994, these mills had an
annual capacity of approximately 1,901,000 tons of pulp and 2,058,000 tons of
printing and writing papers and bleached paperboard.
Most of the pulp produced by the printing and writing papers business is used
in its own paper mills; approximately 9%, produced at the Pensacola and
Courtland mills, was sold in the open market in 1994. A portion of the fiber
requirements of this business also is supplied by other Company pulp mills, and
approximately 2% of its fiber requirements in 1994 were purchased from third-
party suppliers.
Uncoated papers produced by the printing and writing papers business are used
for computer forms, copier paper and envelope papers. Coated papers are used in
catalogs, magazines, brochures, labels and annual reports.
In 1994, 62% of this operation's bleached paperboard production was used by
the Company's DairyPak unit, which converts polyethylene-coated paperboard into
milk and juice cartons and ovenable packaging. The balance either was sold to
independent purchasers, primarily for conversion to cups, or was exported.
The Company leases substantial portions of the Courtland mill under 10 long-
term net leases which expire between 1997 and 2029. Each of these leases
provides for rental payments over its term sufficient to pay interest on and to
retire the industrial development or pollution control revenue bonds issued in
connection with the financing of the property subject to such lease. The
Company is required to purchase, or has the option to purchase, the property
subject to each such lease for a nominal sum at the time the related bonds are
retired.
1
The Company leases a printing facility at the Athens, Georgia DairyPak plant
until 2015. The lease provides for rental payments over its term sufficient to
pay interest on and to retire the industrial development revenue bonds issued to
finance the acquisition of that facility. The Company has the option to
purchase the facility for a nominal sum at the time the bonds are retired.
The domestic printing and writing papers business and the publication papers
business jointly maintain 15 sales offices in various parts of the United
States, as well as an order services office in Hamilton, Ohio, for the sale of
their products to direct purchasers and through paper merchants. Certain of
these sales offices are shared with the newsprint and kraft operations.
Champion Papel e Celulose Ltda., a 99%-owned subsidiary ("Champion Papel"),
is a major integrated manufacturer of pulp and printing and writing papers in
Brazil with net sales to unaffiliated customers of (U.S.) $253,771,000 in 1994.
As of December 31, 1994, this mill had an annual capacity of approximately
336,000 tons of pulp and 374,000 tons of paper. In addition to being a leading
supplier of printing and writing papers in Brazil, Champion Papel exports a
substantial portion of its paper production.
PUBLICATION PAPERS
The publication papers business manufactures and sells coated and uncoated
publication papers and pulp. The manufacturing properties of this operation
consist of integrated pulp and paper mills at Bucksport, Maine; Deferiet, New
York; Quinnesec, Michigan; and Sartell, Minnesota. As of December 31, 1994,
these mills had an annual capacity of approximately 826,000 tons of pulp and
1,273,000 tons of publication papers.
A significant portion of the fiber requirements of the publication papers
business is supplied by its own mills. In addition, a portion of its fiber
requirements is supplied by other Company pulp mills, and approximately 25% of
its fiber requirements in 1994 were purchased from third-party suppliers.
The Company manufactures pulp for sale in the open market at the Quinnesec
mill. In 1994, approximately 65% of the pulp production of this mill, or
244,000 tons, was sold in the open market through the Company's headquarters in
Stamford, Connecticut, as well as a sales office in Appleton, Wisconsin. The
balance was used in the production of paper at the Quinnesec mill and at the
Company's printing and writing papers mills.
The Company's publication papers are used primarily for consumer magazines,
direct mail catalogs, directories, textbooks and coupons. Sales are made to
direct purchasers and through paper merchants and brokers from the 15 sales
offices jointly maintained by the publication papers operation and the printing
and writing papers operation, and from the Hamilton, Ohio order services office.
The Company leases the building which houses one of the paper machines at the
Sartell mill until 2008. Thereafter, the Company has options to renew the lease
for five terms of five years each. The Company also has the option to purchase
the building at its then-current market value at the end of the initial term in
2008 or at the end of each five-year renewal term.
NEWSPRINT
The newsprint business manufactures pulp and manufactures and sells
newsprint, directory paper and groundwood specialties. The manufacturing
properties of this operation consist of integrated pulp and paper mills at
Lufkin and Sheldon, Texas. As of December 31, 1994, these mills had an annual
capacity of approximately 1,043,000 tons of pulp (which includes 151,000 tons of
recycled pulp) and 948,000 tons of newsprint, directory paper and groundwood
specialties.
Virtually all of the newsprint operation's pulp production is used in its own
paper mills; approximately 2% was sold in the open market in 1994.
2
Most of the newsprint produced by the Company is sold in the Southwest,
Southeast and Midwest. In general, sales are made directly to publishers and
printers through four sales offices, three of which are shared with the printing
and writing papers and publication papers operations, and one order services
office.
PULP
For information concerning market pulp produced at the Pensacola and
Courtland mills, see the section captioned Printing and Writing Papers above,
and for information concerning market pulp produced at the Quinnesec mill, see
the section captioned Publication Papers above.
Weldwood of Canada Limited, a Canadian subsidiary in which the Company has
approximately 84% ownership ("Weldwood"), manufactures bleached softwood kraft
pulp at its mill in Hinton, Alberta, Canada. As of December 31, 1994, this mill
had an annual capacity of approximately 424,000 tons. In 1994, approximately
29% of the mill's pulp production was used in the Company's own publication
papers and printing and writing papers mills. The balance was sold in the open
market through the Company's headquarters in Stamford, Connecticut, a Company
sales office in Appleton, Wisconsin and a Weldwood sales office in Bad Homburg,
Germany.
Cariboo Pulp & Paper Company, a joint venture owned equally by Weldwood and
Daishowa-Marubeni International Limited, operates a bleached softwood kraft pulp
mill in Quesnel, British Columbia, Canada. As of December 31, 1994, this mill
had an annual capacity of approximately 340,000 tons. In 1994, approximately
23% of Weldwood's 50% share of the mill's pulp production was used in the
Company's own publication papers and printing and writing papers mills. The
balance of Weldwood's share was sold in the open market through the Company's
headquarters in Stamford, Connecticut, a Company sales office in Appleton,
Wisconsin and a Weldwood sales office in Bad Homburg, Germany.
While certain of the Company's mills purchase pulp in the open market, the
Company and Weldwood overall are net sellers of pulp. In 1994, the Company and
Weldwood in the aggregate produced approximately 830,000 tons of pulp for sale
to unaffiliated purchasers, while the Company used approximately 268,000 tons of
pulp purchased from third-party suppliers, resulting in net market pulp of
approximately 562,000 tons.
KRAFT
The Company produces pulp, unbleached linerboard and kraft paper for
multiwall and grocery bags at its mill in Roanoke Rapids, North Carolina. As of
December 31, 1994, this mill had an annual capacity to produce approximately
495,000 tons of pulp, 403,000 tons of linerboard and 116,000 tons of kraft
paper. All of this mill's pulp production is used at the mill. In addition,
approximately 8% of its fiber requirements in 1994 were purchased from third-
party suppliers. The linerboard and kraft paper produced at the Roanoke Rapids
mill are sold to converters through three sales offices, two of which are shared
with the printing and writing papers and publication papers operations, and one
order services office.
PAPER DISTRIBUTION OPERATION
Nationwide Papers, a unit of the Company, is a distributor of paper and paper
products. Its marketing operations are carried out through 29 wholesale
warehouse facilities in 18 states. In addition, Nationwide Papers operates a
facility which converts rolls of bleached paperboard into sheets for sale
primarily to textile, apparel and furniture producers. In 1994, approximately
83% of its sales were attributable to merchandise purchased from numerous
manufacturers other than the Company. However, Nationwide Papers is not
dependent on any single supplier for such merchandise.
3
WOOD PRODUCTS
The Company is a major producer of plywood and lumber. The Company's wood
products business is conducted through its domestic wood products operations and
through the wood products operations of Weldwood.
The principal wood products manufacturing facilities operated by the Company
and by Weldwood are summarized under Item 2 of this Report. As of December 31,
1994, the Company had approximate annual capacities of 843 million square feet
(3/8" basis) of softwood plywood and 416 million board feet of softwood lumber.
As of December 31, 1994, Weldwood had approximate annual capacities of 425
million square feet (3/8" basis) of plywood (principally softwood), 762 million
board feet of softwood lumber and 160 million square feet (3/8" basis) of
waferboard.
In February 1995, Weldwood sold its two coastal British Columbia sawmills and
related timber-cutting rights to International Forest Products Limited for (Cdn)
$140,000,000 plus an additional amount for inventories. The two sawmills have a
combined annual capacity of 185 million board feet of softwood lumber, which is
not included in the capacity information set forth in this section. In
addition, Weldwood is negotiating with the Hancock Timber Resource Group to sell
approximately 32,000 acres of Weldwood's fee-owned timberlands in coastal
British Columbia.
The Company sells lumber and plywood through four sales offices to
wholesalers, dealers, industrial users and retailers. Weldwood sells wood
products within Canada through a 50%-owned building materials distribution
company which serves all major markets in that country. In addition, Weldwood
exports substantial portions of its products directly. In 1994, Weldwood had
net sales to unaffiliated customers of (U.S.) $694,104,000, of which (U.S.)
$540,924,000 was attributable to the wood products portion of its business.
See the Net Sales table on page 20 of the Company's 1994 Annual Report, which
table is incorporated by reference herein, for information concerning the net
sales to unaffiliated customers of the various products of the wood products
business for 1992, 1993 and 1994.
TIMBER PROPERTIES
The Company owns 4,492,139 acres and controls 578,130 acres of timberlands in
the United States. The Company's owned and controlled timberlands contain in
the aggregate approximately 17,620,000 cunits (one cunit equals one hundred
cubic feet of solid wood) of merchantable sawtimber and approximately 35,645,000
cunits of pulpwood. In 1994, the Company harvested approximately 33% of its
domestic fiber requirements from its owned and controlled timberlands. A
portion of the fiber harvested by the Company is sold in the domestic open
market and in the export market.
Broken down by region, the Company's domestic timber acreage and volume are
as follows: In the State of Washington, the Company owns 296,995 acres and
controls 476 acres of timberlands. These timberlands contain in the aggregate
approximately 8,404,000 cunits of merchantable sawtimber and approximately
597,000 cunits of pulpwood. In the South, primarily in Texas, North Carolina,
South Carolina, Alabama, Georgia, Florida, Tennessee and Virginia, the Company
owns 2,590,015 acres and controls 570,251 acres of timberlands containing in the
aggregate approximately 4,968,000 cunits of merchantable sawtimber and
approximately 20,483,000 cunits of pulpwood. The Company owns 1,605,129 acres
and controls 7,403 acres of timberlands in the North, primarily in Maine,
Michigan, New Hampshire, New York and Vermont. These timberlands contain in the
aggregate approximately 4,248,000 cunits of merchantable sawtimber and
approximately 14,565,000 cunits of pulpwood.
The Company's domestic log and pulpwood requirements are procured from its
owned and controlled lands, as described above, as well as from open market
purchases, short-term timber purchase contracts with independent timber owners
and agencies of the United States and various state governments, and supply
agreements with other companies. In the opinion of management, these sources
will provide an adequate supply of logs and pulpwood to meet the Company's
principal raw materials requirements for the foreseeable future. It is expected
that the proportion of fiber derived from the Company's owned and controlled
lands will decline until the middle to late 1990s but will increase thereafter
as more of the Company's plantations, primarily in the South, reach maturity.
4
Supplementing the Company's domestic timberlands are its several seed
orchards and nursery operations. These facilities will enable the Company to
produce most of the trees which it plans to plant in the United States in the
future, including the approximately 61 million trees planned for planting in
1995.
Weldwood obtains raw materials for its wood products manufacturing operations
primarily from sustained-yield, long-term licenses which grant cutting rights on
government-owned timberlands and from long-term agreements with other companies
based on their harvesting licenses. Weldwood has rights to harvest
approximately 573,000 cunits of merchantable sawtimber from long-term licenses
annually and, during the balance of the current terms of such licenses, has
rights to harvest an aggregate of approximately 8,026,000 cunits. In addition,
Weldwood has rights to obtain approximately 129,000 cunits of merchantable
sawtimber on an annual basis from supply agreements with other companies.
Weldwood believes that these sources will provide a substantial portion of the
raw materials required by its wood products manufacturing operations for the
foreseeable future, with the balance to be obtained from other third-party
suppliers. The timber volume information set forth in this paragraph does not
include the timber-cutting rights sold by Weldwood in February 1995 or the
approximately 32,000 acres of fee-owned timberlands which Weldwood is
negotiating to sell, as discussed above in the section captioned Wood Products.
In addition, in Alberta, Canada, Weldwood has cutting rights through June 15,
2008 with respect to approximately 2,461,000 acres of timberlands pursuant to an
agreement with the Provincial Government of Alberta. This agreement is
renewable at Weldwood's option for successive 20-year periods as long as the
Hinton, Alberta pulp mill remains in operation. Weldwood has the right to
harvest approximately 671,000 cunits of pulpwood annually under this agreement.
Cariboo Pulp & Paper Company holds certain rights to harvest up to 533,000
cunits of pulpwood annually from approximately 3,900,000 acres of government-
owned timberlands in British Columbia pursuant to a long-term license. Weldwood
believes that this source of pulpwood, as well as supplies of wood chips from
sawmills and plywood plants in the area, will satisfy the raw materials
requirements of Cariboo's pulp mill for the foreseeable future. Babine Forest
Products Company, a joint venture in which Weldwood has an indirect 58%
interest, operates a sawmill in British Columbia and is beneficially entitled to
harvest approximately 184,000 cunits of merchantable sawtimber annually pursuant
to long-term licenses. Houston Forest Products Company, a joint venture in
which Weldwood and Eurocan Pulp and Paper Company are equal participants,
operates a sawmill in British Columbia and is beneficially entitled to cut
approximately 229,000 cunits of merchantable sawtimber annually pursuant to a
long-term license.
Champion Papel owns or controls 228,524 acres of timberlands in Brazil, which
are not in or near the Amazon Basin.
Certain of the Company's land holdings have a value substantially in excess
of that of land primarily used for fiber supply purposes. The Company has sold
or contributed to its wholly owned real estate subsidiaries, net of land
repurchased by the Company, an aggregate of approximately 230,000 acres of such
land. These subsidiaries have sold approximately 175,600 acres, of which
approximately 10,100 acres were sold during 1994, for residential, recreational,
commercial or industrial purposes. The balance is being held for similar sale
or long-term appreciation. A substantial portion of the land held by the
Company's real estate subsidiaries is located near Houston, Texas and
Jacksonville, Florida.
MINERAL, OIL AND GAS RESOURCES
The Company owns or controls various mineral, oil and gas rights with respect
to approximately half of the timberlands owned or controlled by the Company in
the United States. The Company has conducted a general review of its domestic
mineral, oil and gas rights and presently is not aware of any significant
reserves or deposits except as discussed below.
The Company has oil and gas interests in fields located in Florida, Alabama,
Texas, Louisiana and Mississippi. Drilling operations are conducted by others
pursuant to leases and other agreements with the Company. The Company
5
estimates that proved reserves attributable to the Company's interests in such
fields aggregate approximately 1,216,000 barrels of oil and 4,244,000 Mcf
(thousand cubic feet) of natural gas as of December 31, 1994. The Company's
share of production from such fields was approximately 489,000 barrels of oil,
1,524,000 Mcf of natural gas and 2,031,000 gallons of gas products in 1994.
Proved oil and gas reserves attributable to the Company's non-operating
royalty interests and/or operating interests in the oil and gas fields described
above are based primarily upon estimates furnished by the operators of those
fields. The Company's share of production from such fields during each calendar
year is based on monthly production information received from the operators,
showing the application of such interests of the Company to actual production
volumes for such month.
The Company owns the surface rights and full or partial mineral rights to
considerable timberlands in Texas which overlay lignite deposits. The Company
estimates that it owns approximately 350,000,000 tons of lignite reserves in
Texas, of which 80% is estimated to be recoverable. These lignite reserves
presently are not being mined due to current market conditions.
CAPITAL PROGRAM
With the completion of the Company's extensive capital improvement program in
1993, capital spending has been reduced to levels required for routine capital
replacements, environmental compliance and incremental improvements. The
Company presently anticipates that capital spending will be approximately $390
million in 1995.
COMPETITION
The markets in which the Company sells its products are highly competitive.
The Company faces numerous competitors within the forest products industry in
each of its major markets and also competes with suppliers of milk and juice
cartons and kraft paper substitutes made from plastics. Competition in all
markets is based primarily on price. The Company is one of the largest domestic
producers and suppliers of printing and writing papers, publication papers,
newsprint, lumber, plywood, milk and juice cartons, and hardwood market pulp.
Weldwood is the largest producer of plywood and one of the largest producers of
lumber and softwood market pulp in Canada. Champion Papel is one of the largest
producers and suppliers of printing and writing papers in Brazil.
FOREIGN OPERATIONS
Net sales to unaffiliated customers by the Company's foreign subsidiaries for
1994 were (U.S.) $947,875,000, accounting for 17.8% of consolidated net sales of
the Company. Income from operations of the foreign subsidiaries for 1994 was
(U.S.) $188,027,000 which, reflecting the weak overall results of the Company's
domestic operations, accounted for 70.7% of the consolidated income from
operations of the Company. Net income (after minority interest) of the foreign
subsidiaries for 1994 was (U.S.) $132,088,000, which accounted for all of the
consolidated income of the Company.
The major foreign operations, which are discussed above under their
respective business segment headings, are in Canada and Brazil. The Company
believes that the risks associated with its foreign operations are somewhat
greater than those associated with its domestic operations. Weldwood exports
substantial portions of its products and, as a result, is affected significantly
by currency fluctuations. Champion Papel, the Company's Brazilian subsidiary,
is subject to that country's continuing inflation and currency fluctuations,
which have moderated as the result of various governmental actions in the last
year. Tight monetary and fiscal policies, including high interest rates,
imposed in recent years in an attempt to control Brazil's high inflation rate,
remain in effect. (See Note 14 of Notes to Financial Statements on page 38 of
the Company's 1994 Annual Report, which Note is incorporated by reference
herein, for further information as to foreign operations.)
6
EMPLOYEES
The Company had 24,615 employees at December 31, 1994. Of these, 18,220 were
domestic employees, 54% of whom were covered by contracts with labor unions.
Overall, 63% of the Company's employees were covered by contracts with labor
unions.
Union contracts covering domestic operations will expire as follows: 1995 -
the Bucksport, Maine and Sartell, Minnesota publication papers mills, and the
Courtland, Alabama printing and writing papers mill; 1996 - the Pensacola,
Florida printing and writing papers mill; 1997 - the Florida, Maine and Georgia
wood products operations; 1998 - the Deferiet, New York publication papers mill
and the Canton, North Carolina and Hamilton, Ohio printing and writing papers
mills; 1999 - the Roanoke Rapids, North Carolina kraft mill and the Lufkin and
Sheldon, Texas newsprint mills.
The Quinnesec, Michigan publication papers mill is a non-union facility.
At Weldwood, union contracts covering the Hinton, Alberta pulp mill and
timberlands operation and the joint venture pulp mill at Quesnel, British
Columbia expired in 1994. These facilities presently are operating under the
terms of their respective expired contracts while efforts to reach settlements
continue. Union contracts covering all of the wood products facilities except
the Longlac, Ontario plants and the Hinton timberlands operation will expire in
1997. The union contract covering the waferboard plant and specialty hardwood
plywood plant in Longlac will expire in 1996.
The union contract which covers the paper industry in Brazil, including
Champion Papel, is renegotiated each year.
THE ENVIRONMENT
For information regarding environmental capital expenditures, hazardous
substance cleanup, environmental legal proceedings and other environmental
matters affecting the Company, see Management's Discussion and Analysis of
Financial Condition and Results of Operations, incorporated by reference in Item
7 of this Report from the Company's 1994 Annual Report.
ENERGY REQUIREMENTS
The Company believes that it will be able to meet its energy needs for the
foreseeable future. Wood wastes and pulping liquors, which are by-products from
the manufacture of wood products and pulp, provide a reliable and relatively
low-cost source of energy for the Company's primary manufacturing facilities.
The Company's domestic wood products manufacturing facilities and domestic pulp,
paper and kraft mills satisfy approximately half of their energy requirements
from such wood wastes and pulping liquors.
The Company's foreseeable needs for purchased energy have been anticipated,
and the Company believes that it has arranged for adequate sources of supply.
ITEM 2. PROPERTIES
In 1994, the overall operating rate for the Company's domestic and foreign
manufacturing facilities exceeded 99% of capacity in the paper segment, 88% of
capacity for lumber and studs, and 97% of capacity for panelboard (plywood and
waferboard). Production curtailments in the Company's paper segment were
attributable primarily to scheduled maintenance. Production curtailments in the
wood products segment were attributable primarily to log supply shortages
resulting from the scarcity of timber and scheduled modernization projects.
7
Reference is made to Item 1 of this Report for information concerning the
general character, adequacy and capacity of the principal plants, timber
properties and other materially important physical properties of the Company.
The following lists show the location, nature and ownership of the Company's
principal plants. Except as indicated, none of these plants is subject to a
mortgage and all are owned in fee.
PAPER
PRINTING AND WRITING PAPERS
(a) Integrated pulp and printing and writing papers mills:
(i) Courtland, Alabama/1/;
(ii) Canton, North Carolina;
(iii) Pensacola, Florida; and
(iv) Mogi Guacu, Brazil.
(b) The Company operates a printing and writing papers mill in Hamilton,
Ohio.
(c) The Company operates a plant in Waynesville, North Carolina which
applies polyethylene coating to bleached paperboard and which also converts roll
stock into cut-size paper.
(d) The Company operates five plants which convert polyethylene-coated
paperboard into milk and juice cartons and one plant which converts
polyethylene-coated paperboard into ovenable packaging. All of these plants are
located in the United States./2/
PUBLICATION PAPERS
(e) Integrated pulp and publication papers mills:
(i) Bucksport, Maine;
(ii) Deferiet, New York;
(iii) Quinnesec, Michigan; and
(iv) Sartell, Minnesota/3/.
NEWSPRINT
(f) Integrated pulp and newsprint mills:
(i) Lufkin, Texas; and
(ii) Sheldon, Texas.
PULP
(g) The Company's printing and writing papers mills in Pensacola, Florida
and Courtland, Alabama and publication papers mill in Quinnesec, Michigan also
produce market pulp.
_________________________
/1/For Courtland, Alabama mill lease information, see Item 1 - Paper of this
Report.
/2/For lease information regarding one of these plants, located in Athens,
Georgia, see Item 1 - Paper of this Report.
/3/For Sartell, Minnesota mill lease information, see Item 1 - Paper of this
Report.
8
(h) Weldwood operates a pulp mill in Hinton, Alberta, Canada and owns 50% of
a joint venture which operates a pulp mill in Quesnel, British Columbia, Canada.
KRAFT
(i) The Company operates an integrated pulp, unbleached linerboard and
kraft paper mill in Roanoke Rapids, North Carolina.
WOOD PRODUCTS
(a) The Company operates three softwood plywood plants in the United States.
(b) Weldwood operates two softwood plywood plants and one specialty hardwood
plywood plant in Canada. One of these plants is located on leased land.
(c) The Company operates five softwood lumber mills in the United States.
(d) Weldwood operates three softwood lumber mills in Canada. One of these
mills is located on leased land.
(e) Each of Babine Forest Products Company and Houston Forest Products
Company, joint ventures in which Weldwood has an interest, operates a mill for
the production of softwood lumber in Canada. One of these mills is located on
leased land.
(f) Weldwood operates one waferboard plant in Canada.
ITEM 3. LEGAL PROCEEDINGS
On January 4, 1991, a class action was brought against the Company in state
court in Tennessee. The class consisted of all Tennessee residents who own or
lease land around Douglas Lake or along the Pigeon River. Subsequently, the
case was transferred to the United States District Court for the Eastern
District of Tennessee. While the original complaint sought $5 billion in
compensatory and punitive damages, immediately prior to trial the plaintiffs
reduced their demand to $367.9 million. The plaintiffs originally claimed
damages for both personal injury and property damage, but the personal injury
claims were dismissed. The case proceeded to trial on plaintiffs' theory that
discharges of hazardous materials, including dioxin, from the Company's Canton,
North Carolina mill had decreased property values along the river and the lake.
On October 16, 1992, a mistrial was declared when the jury was unable to reach a
unanimous verdict. On May 3, 1993, the court approved a settlement of the
action providing for the payment of $6.5 million by the Company. On June 1,
1993, the court's approval of the settlement was appealed, and on September 20,
1994, the appeal was dismissed by the United States Court of Appeals for the
Sixth Circuit. On November 7, 1994, a motion for rehearing was denied. The
time has expired for any further appeal of the court's approval of the
settlement and, accordingly, the settlement is final.
On November 9, 1992, an action was brought against the Company in the Circuit
Court for Baldwin County, Alabama, on behalf of a class consisting of all
persons who own land along Perdido Bay in Florida and Alabama. The action
originally sought $500 million in compensatory and punitive damages for personal
injury, intentional infliction of emotional distress and diminution in property
value allegedly resulting from the purported discharge of hazardous substances,
including dioxin, from the Company's Pensacola, Florida mill into Eleven Mile
Creek, which flows into Perdido Bay. However, in February 1994, the plaintiffs
reduced their demand to not more than $50,000 for each class member, and in June
1994, the personal injury claims were dismissed. It is anticipated that the
class, which was certified by the court in June 1994, will consist of
approximately 2,000 members. The parties currently are engaged in discovery.
9
In February 1994, the Company received a notice of violation from the Texas
Natural Resources Conservation Commission ("TNRCC") alleging unauthorized air
emissions from the Company's Sheldon, Texas mill. The notice of violation
alleged several violations, all but two of which have been resolved without
penalty. With respect to the two remaining alleged violations, it is expected
that the TNRCC will seek penalties, although the Company is unable at this time
to estimate the amount of penalties which may be sought or finally assessed.
The Company is vigorously defending each of the pending actions described
above.
The Company also is involved in other legal and administrative proceedings
and claims of various types. While any litigation contains an element of
uncertainty, management, based upon the opinion of the Company's General
Counsel, presently believes that the outcome of each such proceeding or claim
which is pending or known to be threatened (including the actions described
above), or all of them combined, will not have a material adverse effect on the
Company.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
EXECUTIVE OFFICERS OF THE REGISTRANT/1/
John A. Ball (age 66) is a Senior Vice President of the Company, a position
which he has held since March 1983. He has responsibility for corporate and
marketing communications, governmental affairs, public affairs and facilities
services.
L. Scott Barnard (age 52) is an Executive Vice President of the Company, a
position which he has held since August 1992. He has responsibility for sales
and marketing for the printing and writing papers and publication papers
businesses. From February 1989 to August 1992, he was Vice President-Sales and
Marketing for the printing and writing papers and publication papers businesses.
William H. Burchfield (age 59) is an Executive Vice President of the Company,
a position which he has held since November 1982. He has responsibility for the
domestic printing and writing papers business.
Mark V. Childers (age 42) is Senior Vice President-Organizational Development
and Human Resources of the Company, a position which he has held since August
1992. From June 1991 to August 1992, he was Vice President-Organizational
Development Project of the Company. From August 1988 to June 1991, he was
Manager-Organizational Development at the Lufkin, Texas mill.
Richard J. Diforio, Jr. (age 59) is a Senior Vice President of the Company, a
position which he has held since November 1992. He has responsibility for
environmental, health and safety affairs. From September 1990 to November 1992,
he was Vice President-Environment, Health and Safety of the Company. From
September 1986 to September 1990, he was Vice President-Environmental Affairs of
the Company.
Joe K. Donald (age 52) is an Executive Vice President of the Company, a
position which he has held since August 1989. He has responsibility for the
publication papers business.
Mark A. Fuller, Jr. (age 62) is an Executive Vice President of the Company, a
position which he has held since August 1980. He has responsibility for the
Company's overall marketing program as well as for Nationwide Papers, Champion
Export, pulp sales, and sales of wood chemicals and by-products.
_______________________________
/1/The term of office for each executive officer expires at the Annual Meeting
of the Board of Directors of the Company scheduled to be held on May 18, 1995.
10
Marvin H. Ginsky (age 64) is Senior Vice President and General Counsel of the
Company. He was elected a Senior Vice President in May 1981. He has been the
General Counsel since 1973.
L.C. Heist (age 63) is President and Chief Operating Officer and a director
of the Company, positions which he has held since December 1987.
Frank Kneisel (age 57) was elected Senior Vice President-Finance effective
January 1, 1995. He had been Treasurer since 1975 and a Vice President since
1981.
Burton G. MacArthur, Jr. (age 48) is an Executive Vice President of the
Company, a position which he has held since January 1990. He has responsibility
for the newsprint and kraft operations.
Kenwood C. Nichols (age 55) is Vice Chairman and a director of the Company,
positions which he has held since August 1989. He has been the principal
accounting officer of the Company since July 1983. He also has responsibility
for internal audit, corporate analysis, tax affairs, management information
services, mineral resources, corporate security and the Company's real estate
subsidiaries.
Richard E. Olson (age 57) is an Executive Vice President of the Company, a
position which he has held since December 1987. He has responsibility for
engineering, technology, manufacturing support and major projects.
Richard L. Porterfield (age 48) is an Executive Vice President of the
Company, a position which he has held since August 1992. He heads the forest
products unit, which consists of domestic timberlands operations and the
domestic wood products business. From January 1990 to August 1992, he was
Senior Vice President-Organizational Development and Human Resources of the
Company.
Andrew C. Sigler (age 63) is Chairman of the Board of Directors and Chief
Executive Officer of the Company. He was elected Chairman of the Board
effective January 1, 1979. He has served as Chief Executive Officer since 1974
and has been a director since 1973.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
The Company had 21,936 record holders of its Common Stock as of February 28,
1995.
The Company's Common Stock is traded on the New York Stock Exchange.
Restrictions on the ability of the Company to pay cash dividends are included
in several of the Company's debt instruments and the Company's Restated
Certificate of Incorporation. At December 31, 1994, the most restrictive of
these limitations required the Company to maintain tangible net worth (as
defined below) of at least $2.770 billion. As a result of this requirement,
such amount is unavailable for the payment of dividends. Approximately $464
million of tangible net worth at December 31, 1994 was free of such
restrictions. Tangible net worth is defined as shareholders' equity plus the
Company's $92.50 Cumulative Convertible Preference Stock minus goodwill,
unamortized debt discount and other like intangibles, all determined on a
consolidated basis for the Company.
For information concerning the high and low sales prices of the Company's
Common Stock for each quarterly period during the last two years and the amount
of dividends paid on the Company's Common Stock in each quarterly period during
the last two years, see the section on the inside back cover of the Company's
1994 Annual Report captioned Common Stock Prices and Dividends Paid. Said
section is incorporated by reference herein.
ITEM 6. SELECTED FINANCIAL DATA
There is incorporated by reference herein the table on pages 48 and 49 of the
Company's 1994 Annual Report
11
captioned Eleven-Year Selected Financial Data.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
There is incorporated by reference herein the section on pages 42 to 47 of
the Company's 1994 Annual Report captioned Management's Discussion and Analysis
of Financial Condition and Results of Operations.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
There is incorporated by reference herein the sections of the Company's 1994
Annual Report captioned Consolidated Income, Consolidated Retained Earnings,
Consolidated Balance Sheet, Consolidated Cash Flows, Notes to Financial
Statements and Report of Independent Public Accountants, which sections are on
pages 23, 24, 25, 26, 27 to 40, and 41, respectively, of the Company's 1994
Annual Report.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
Not applicable.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
See the section captioned Executive Officers of the Registrant under Part I
of this Report for information concerning the Company's executive officers.
For information concerning the directors of the Company, see the sections
therein captioned The Board of Directors-The Nominees, Information on the
Nominees and Directors, and Committees in the Company's definitive Proxy
Statement for the Annual Meeting of Shareholders scheduled to be held on May 18,
1995. Said sections are incorporated by reference herein.
ITEM 11. EXECUTIVE COMPENSATION
There is incorporated by reference herein from the Company's definitive Proxy
Statement for the Annual Meeting of Shareholders scheduled to be held on May 18,
1995 the sections therein captioned The Board of Directors-Directors'
Compensation; and Executive Compensation-Summary Compensation Table, Option/SAR
Grant Table, Option/SAR Exercise and Year-End Values Table, Pension Plan Table,
and Employment and Severance Agreements.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
There is incorporated by reference herein from the Company's definitive Proxy
Statement for the Annual Meeting of Shareholders scheduled to be held on May 18,
1995 the sections therein captioned Principal Shareholders and Stock Ownership
by Nominees, Directors and Named Executive Officers.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
There is incorporated by reference herein from the Company's definitive Proxy
Statement for the Annual Meeting of Shareholders scheduled to be held on May 18,
1995 the section therein captioned Transactions.
12
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) FINANCIAL STATEMENTS. The following Consolidated Financial Statements
of Champion International Corporation and Subsidiaries, Notes to Financial
Statements, and Report of Independent Public Accountants are incorporated by
reference herein from the Company's 1994 Annual Report:
CAPTION IN COMPANY'S
DESCRIPTION 1994 ANNUAL REPORT (PAGE NUMBER)
--------------------------- --------------------------------
Consolidated Statements of Income for
each of the three years in the period
ended December 31, 1994...........................Consolidated Income (page 23)
Consolidated Statements of Retained
Earnings for each of the three years
in the period ended December 31, 1994...Consolidated Retained Earnings (page 24)
Consolidated Balance Sheets at
December 31, 1994 and 1993..................Consolidated Balance Sheet (page 25)
Consolidated Statements of Cash Flows
for each of the three years in the
period ended December 31, 1994.................Consolidated Cash Flows (page 26)
Notes to Financial Statements.....Notes to Financial Statements (pages 27 to 40)
Report of Independent Public
Accountants with respect to the
financial statements listed above......Report of Independent Public Accountants
(page 41)
(b) FINANCIAL STATEMENT SCHEDULES. All Financial Statement Schedules
have been omitted since the information is not applicable, is not required or is
included in the Consolidated Financial Statements or Notes to Financial
Statements listed under section (a) of this Item 14.
(c) EXHIBITS. Each Exhibit is listed according to the number assigned to
it in the Exhibit Table of Item 601 of Regulation S-K. The Exhibit numbers
preceded by an asterisk (*) indicate Exhibits physically filed with this Annual
Report on Form 10-K. All other Exhibit numbers indicate Exhibits filed by
incorporation by reference herein. Exhibit numbers 10.1 through 10.33, which
are preceded by a plus sign (+), are management contracts or compensatory plans
or arrangements.
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
3.1 Restated Certificate of Incorporation of the Company, filed in
the State of New York on October 20, 1986 (filed by incorporation
by reference to Exhibit 3.1 to the Company's Form 10-K for the
fiscal year ended December 31, 1986, Commission File No. 1-3053).
3.2 Certificate of Amendment of Restated Certificate of Incorporation
of the Company, filed in the State of New York on July 18, 1988
(filed by incorporation by reference to Exhibit 4.1 to the
Company's Form 10-Q for the quarter ended June 30, 1988,
Commission File No. 1-3053).
3.3 Certificate of Amendment of Restated Certificate of Incorporation
of the Company, filed in the State of New York on December 6,
1989 (filed by incorporation by reference to Exhibit 4.1 to the
Company's Form 8-K dated December 14, 1989, Commission File No.
1-3053).
3.4 Certificate of Amendment of Restated Certificate of Incorporation
of the Company, filed
13
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
in the State of New York on December 21, 1989 (filed by
incorporation by reference to Exhibit 3.4 to the Company's Form
10-K for the fiscal year ended December 31, 1989, Commission File
No. 1-3053).
3.5 By-Laws of the Company (filed by incorporation by reference to
Exhibit 3(ii).1 to the Company's Form 10-Q for the quarter ended
March 31, 1993, Commission File No. 1-3053).
4.1 Letter agreement dated March 29, 1991 of the Company to furnish
to the Commission upon request copies of certain instruments with
respect to long-term debt (filed by incorporation by reference to
Exhibit 4 to the Company's Form 10-K for the fiscal year ended
December 31, 1990, Commission File No. 1-3053).
4.2 Agreement dated February 2, 1994 between the Company and Loews
Corporation (filed by incorporation by reference to Exhibit 4.7
to the Company's Registration Statement on Form S-3, Commission
Registration No. 33-52123).
+10.1 Champion International Corporation 1986 Management Incentive
Program, consisting of the 1986 Stock Option Plan and the 1986
Contingent Compensation Plan (filed by incorporation by reference
to Exhibit 19.1 to the Company's Form 10-Q for the quarter ended
June 30, 1986, Commission File No. 1-3053).
+10.2 Amendment to Champion International Corporation 1986 Management
Incentive Program (filed by incorporation by reference to Exhibit
10.1 to the Company's Form 10-Q for the quarter ended March 31,
1993, Commission File No. 1-3053).
+10.3 Champion International Corporation Management Incentive Program,
as amended, consisting of the Amended 1976 Incentive Stock Option
Plan and the Contingent Compensation Plan (filed by incorporation
by reference to Exhibit 4.3 to the Company's Registration
Statement on Form S-8, Commission Registration No. 2-77129).
+10.4 Resolutions of the Board of Directors of the Company adopted on
August 16, 1984 amending the Amended 1976 Incentive Stock Option
Plan (filed by incorporation by reference to Exhibit 10(b) to the
Company's Registration Statement on Form S-14, Commission
Registration No. 2-94030).
+10.5 Champion International Corporation Supplemental Retirement Income
Plan (filed by incorporation by reference to Exhibit 10.7 to the
Company's Form 10-K for the fiscal year ended December 31, 1989,
Commission File No. 1-3053).
*+10.6 Amendment dated as of January 1, 1994 to Champion International
Corporation Supplemental Retirement Income Plan.
+10.7 Champion International Corporation Nonqualified Supplemental
Savings Plan (filed by incorporation by reference to Exhibit 10.2
to the Company's Form 10-Q for the quarter ended September 30,
1994, Commission File No. 1-3053).
+10.8 Supplemental Retirement and Death Payments Agreement dated as of
August 1, 1964, as amended by letter agreement dated January 9,
1965, between the Company and Mr. Sigler (filed by incorporation
by reference to Exhibit 10.8 to the Company's Form 10-K for the
fiscal year ended December 31, 1990, Commission File No. 1-3053).
14
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
+10.9 Restated Agreement between the Company and Mr. Sigler, as amended
as of February 19, 1987, providing certain employment, severance
and retirement arrangements (filed by incorporation by reference
to Exhibit 19.1 to the Company's Form 10-Q for the quarter ended
June 30, 1987, Commission File No. 1-3053).
+10.10 Agreement Relating to Legal Expenses dated February 19, 1987
between the Company and Mr. Sigler providing reimbursement of
certain legal expenses following a change in control of the
Company (filed by incorporation by reference to Exhibit 19.2 to
the Company's Form 10-Q for the quarter ended June 30, 1987,
Commission File No. 1-3053).
+10.11 Amendment dated as of April 21, 1988 to Restated Agreement
between the Company and Mr. Sigler, as amended as of February 19,
1987 (filed by incorporation by reference to Exhibit 19.1 to the
Company's Form 10-Q for the quarter ended June 30, 1988,
Commission File No. 1-3053).
+10.12 Amendment dated as of August 18, 1988 to Restated Agreement
between the Company and Mr. Sigler, as amended as of February 19,
1987 (filed by incorporation by reference to Exhibit 10.10 to the
Company's Form 10-K for the fiscal year ended December 31, 1988,
Commission File No. 1-3053).
+10.13 Amendment dated as of August 18, 1988 to Agreement Relating to
Legal Expenses dated February 19, 1987 between the Company and
Mr. Sigler (filed by incorporation by reference to Exhibit 10.11
to the Company's Form 10-K for the fiscal year ended December 31,
1988, Commission File No. 1-3053).
+10.14 Amendment dated as of September 19, 1991 to Restated Agreement
between the Company and Mr. Sigler, as amended as of February 19,
1987 (filed by incorporation by reference to Exhibit 10.12 to the
Company's Form 10-K for the fiscal year ended December 31, 1991,
Commission File No. 1-3053).
*+10.15 Amendment dated as of November 17, 1994 to Restated Agreement
between the Company and Mr. Sigler, as amended as of February 19,
1987.
*+10.16 Agreement dated November 17, 1994 between the Company and Mr.
Sigler relating to post-employment consulting services.
+10.17 Agreement dated as of August 18, 1988 between the Company and Mr.
Heist providing certain employment, severance and retirement
arrangements (filed by incorporation by reference to Exhibit
10.17 to the Company's Form 10-K for the fiscal year ended
December 31, 1988, Commission File No. 1-3053).
+10.18 Agreement Relating to Legal Expenses dated August 18, 1988
between the Company and Mr. Heist providing reimbursement of
certain legal expenses following a change in control of the
Company (filed by incorporation by reference to Exhibit 10.18 to
the Company's Form 10-K for the fiscal year ended December 31,
1988, Commission File No. 1-3053).
+10.19 Amendment dated as of September 19, 1991 to Agreement dated as of
August 18, 1988 between the Company and Mr. Heist (filed by
incorporation by reference to Exhibit 10.15 to the Company's Form
10-K for the fiscal year ended December 31, 1991, Commission File
No. 1-3053).
+10.20 Agreement dated as of October 18, 1990 between the Company and
Mr. Nichols providing certain employment, severance and
retirement arrangements (filed by incorporation by
15
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
reference to Exhibit 10.16 to the Company's Form 10-K for the
fiscal year ended December 31, 1990, Commission File No. 1-3053).
+10.21 Agreement Relating to Legal Expenses dated October 18, 1990
between the Company and Mr. Nichols providing reimbursement of
certain legal expenses following a change in control of the
Company (filed by incorporation by reference to Exhibit 10.17 to
the Company's Form 10-K for the fiscal year ended December 31,
1990, Commission File No. 1-3053).
+10.22 Amendment dated as of September 19, 1991 to Agreement dated as of
October 18, 1990 between the Company and Mr. Nichols (filed by
incorporation by reference to Exhibit 10.18 to the Company's Form
10-K for the fiscal year ended December 31, 1991, Commission File
No. 1-3053).
+10.23 Agreement dated as of February 19, 1987 between the Company and
Mr. Burchfield providing certain severance arrangements (filed by
incorporation by reference to Exhibit 10.15 to the Company's Form
10-K for the fiscal year ended December 31, 1987, Commission File
No. 1-3053).
+10.24 Agreement Relating to Legal Expenses dated February 19, 1987
between the Company and Mr. Burchfield providing reimbursement of
certain legal expenses following a change in control of the
Company (filed by incorporation by reference to Exhibit 10.16 to
the Company's Form 10-K for the fiscal year ended December 31,
1987, Commission File No. 1-3053).
+10.25 Amendment dated as of April 21, 1988 to Agreement dated as of
February 19, 1987 between the Company and Mr. Burchfield (filed
by incorporation by reference to Exhibit 19.5 to the Company's
Form 10-Q for the quarter ended June 30, 1988, Commission File
No. 1-3053).
+10.26 Amendment dated as of September 19, 1991 to Agreement dated as of
February 19, 1987 between the Company and Mr. Burchfield (filed
by incorporation by reference to Exhibit 10.22 to the Company's
Form 10-K for the fiscal year ended December 31, 1991, Commission
File No. 1-3053).
+10.27 Agreement dated as of August 18, 1988 between the Company and Mr.
Olson providing certain severance arrangements (filed by
incorporation by reference to Exhibit 10.23 to the Company's Form
10-K for the fiscal year ended December 31, 1990, Commission File
No. 1-3053).
+10.28 Agreement Relating to Legal Expenses dated August 18, 1988
between the Company and Mr. Olson providing reimbursement of
certain legal expenses following a change in control of the
Company (filed by incorporation by reference to Exhibit 10.24 to
the Company's Form 10-K for the fiscal year ended December 31,
1990, Commission File No. 1-3053).
+10.29 Amendment dated as of September 19, 1991 to Agreement dated as of
August 18, 1988 between the Company and Mr. Olson (filed by
incorporation by reference to Exhibit 10.28 to the Company's Form
10-K for the fiscal year ended December 31, 1991, Commission File
No. 1-3053).
+10.30 Trust Agreement dated as of February 19, 1987 between the Company
and Shawmut Bank Connecticut, N.A. securing certain payments
under the contracts listed as Exhibit Numbers 10.9 through 10.29,
among others, following a change in control of the Company (filed
16
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
by incorporation by reference to Exhibit 19.11 to the Company's
Form 10-Q for the quarter ended June 30, 1987, Commission File
No. 1-3053).
+10.31 Amendment dated as of August 18, 1988 to Trust Agreement dated as
of February 19, 1987 between the Company and Shawmut Bank
Connecticut, N.A. (filed by incorporation by reference to Exhibit
10.29 to the Company's Form 10-K for the fiscal year ended
December 31, 1988, Commission File No. 1-3053).
+10.32 Champion International Corporation Executive Life Insurance Plan
(filed by incorporation by reference to Exhibit 10.27 to the
Company's Form 10-K for the fiscal year ended December 31, 1990,
Commission File No. 1-3053).
*+10.33 Amendment dated as of January 1, 1994 to Champion International
Corporation Executive Life Insurance Plan.
10.34 Extract from the minutes of the meeting of the Board of
Directors of the Company held on October 18, 1979 relating to the
$50,000 of group term life insurance provided by the Company for
non-employee directors (filed by incorporation by reference to
Exhibit 10.28 to the Company's Form 10-K for the fiscal year
ended December 31, 1990, Commission File No. 1-3053).
10.35 Resolutions of the Board of Directors of the Company adopted on
September 19, 1991 relating to the compensation of directors
(filed by incorporation by reference to Exhibit 19 to the
Company's Form 10-Q for the quarter ended September 30, 1991,
Commission File No. 1-3053).
10.36 Resolutions of the Board of Directors of the Company adopted on
August 18, 1994 relating to the compensation of directors (filed
by incorporation by reference to Exhibit 10.1 to the Company's
Form 10-Q for the quarter ended September 30, 1994, Commission
File No. 1-3053).
10.37 Retirement Plan for Outside Directors (filed by incorporation by
reference to Exhibit 19 to the Company's Form 10-Q for the
quarter ended September 30, 1992, Commission File No. 1-3053).
*11 Schedule showing calculation of primary earnings per common share
and fully diluted earnings per common share.
*13 Portions of the Company's 1994 Annual Report which are
specifically incorporated by reference herein.
*21 List of significant subsidiaries of the Company.
*23.1 Opinion and Consent of the Senior Vice President and General
Counsel of the Company.
*23.2 Consent of Arthur Andersen LLP.
*24 Power of Attorney relating to the execution and filing of this
Annual Report on Form 10-K and all amendments hereto.
*27 Financial Data Schedule.
17
(d) REPORTS ON FORM 8-K. The Company filed a Current Report on Form
8-K dated October 13, 1994 reporting the issuance of a press release announcing
certain unaudited consolidated financial results of the Company for the three
months and nine months ended September 30, 1994, with the consolidated statement
of income for the three months and nine months ended September 30, 1994 and
September 30, 1993 and consolidated balance sheet as of September 30, 1994 and
December 31, 1993 as exhibits thereto.
18
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 THE 30TH DAY OF MARCH,
1995.
CHAMPION INTERNATIONAL CORPORATION
(Registrant)
By Lawrence A. Fox
---------------------------------
(LAWRENCE A. FOX)
VICE PRESIDENT AND SECRETARY
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
--------- ----- ----
Andrew C. Sigler* Chairman of the Board, March 30, 1995
------------------------- Chief Executive Officer
(ANDREW C. SIGLER) and Director (Principal
Executive Officer)
Kenwood C. Nichols* Vice Chairman and March 30, 1995
------------------------- Director (Principal
(KENWOOD C. NICHOLS) Accounting Officer)
Frank Kneisel* Senior Vice President- March 30, 1995
------------------------- Finance (Principal
(FRANK KNEISEL) Financial Officer)
Robert A. Charpie* Director March 30, 1995
-------------------------
(ROBERT A. CHARPIE)
Alice F. Emerson* Director March 30, 1995
-------------------------
(ALICE F. EMERSON)
Allan E. Gotlieb* Director March 30, 1995
-------------------------
(ALLAN E. GOTLIEB)
L.C. Heist* Director March 30, 1995
-------------------------
(L.C. HEIST)
Sybil C. Mobley* Director March 30, 1995
-------------------------
(SYBIL C. MOBLEY)
19
SIGNATURE TITLE DATE
--------- ----- ----
Director
-------------------------
(H. BARCLAY MORLEY)
Lawrence G. Rawl* Director March 30, 1995
-------------------------
(LAWRENCE G. RAWL)
Walter V. Shipley* Director March 30, 1995
-------------------------
(WALTER V. SHIPLEY)
James S. Tisch* Director March 30, 1995
-------------------------
(JAMES S. TISCH)
Richard E. Walton* Director March 30, 1995
-------------------------
(RICHARD E. WALTON)
John L. Weinberg* Director March 30, 1995
-------------------------
(JOHN L. WEINBERG)
*By Lawrence A. Fox March 30, 1995
--------------------
(LAWRENCE A. FOX)
A POWER OF ATTORNEY AUTHORIZING LAWRENCE A. FOX, MARVIN H. GINSKY AND ANDREW
C. SIGLER AND EACH OF THEM TO SIGN THIS REPORT AND ALL AMENDMENTS HERETO AS
ATTORNEYS-IN-FACT FOR OFFICERS AND DIRECTORS OF THE REGISTRANT IS FILED AS
EXHIBIT 24 HERETO.
20
EXHIBIT INDEX
Each Exhibit is listed according to the number assigned to it in the
Exhibit Table of Item 601 of Regulation S-K. The Exhibit numbers preceded by an
asterisk (*) indicate Exhibits physically filed with this Annual Report on Form
10-K. All other Exhibit numbers indicate Exhibits filed by incorporation by
reference herein. Exhibit numbers 10.1 through 10.33, which are preceded by a
plus sign (+), are management contracts or compensatory plans or arrangements.
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
3.1 Restated Certificate of Incorporation of the Company, filed in
the State of New York on October 20, 1986 (filed by incorporation
by reference to Exhibit 3.1 to the Company's Form 10-K for the
fiscal year ended December 31, 1986, Commission File No. 1-3053).
3.2 Certificate of Amendment of Restated Certificate of Incorporation
of the Company, filed in the State of New York on July 18, 1988
(filed by incorporation by reference to Exhibit 4.1 to the
Company's Form 10-Q for the quarter ended June 30, 1988,
Commission File No. 1-3053).
3.3 Certificate of Amendment of Restated Certificate of Incorporation
of the Company, filed in the State of New York on December 6,
1989 (filed by incorporation by reference to Exhibit 4.1 to the
Company's Form 8-K dated December 14, 1989, Commission File No.
1-3053).
3.4 Certificate of Amendment of Restated Certificate of Incorporation
of the Company, filed in the State of New York on December 21,
1989 (filed by incorporation by reference to Exhibit 3.4 to the
Company's Form 10-K for the fiscal year ended December 31, 1989,
Commission File No. 1-3053).
3.5 By-Laws of the Company (filed by incorporation by reference to
Exhibit 3(ii).1 to the Company's Form 10-Q for the quarter ended
March 31, 1993, Commission File No. 1-3053).
4.1 Letter agreement dated March 29, 1991 of the Company to furnish
to the Commission upon request copies of certain instruments with
respect to long-term debt (filed by incorporation by reference to
Exhibit 4 to the Company's Form 10-K for the fiscal year ended
December 31, 1990, Commission File No. 1-3053).
4.2 Agreement dated February 2, 1994 between the Company and Loews
Corporation (filed by incorporation by reference to Exhibit 4.7
to the Company's Registration Statement on Form S-3, Commission
Registration No. 33-52123).
+10.1 Champion International Corporation 1986 Management Incentive
Program, consisting of the 1986 Stock Option Plan and the 1986
Contingent Compensation Plan (filed by incorporation by reference
to Exhibit 19.1 to the Company's Form 10-Q for the quarter ended
June 30, 1986, Commission File No. 1-3053).
+10.2 Amendment to Champion International Corporation 1986 Management
Incentive Program (filed by incorporation by reference to Exhibit
10.1 to the Company's Form 10-Q for the quarter ended March 31,
1993, Commission File No. 1-3053).
+10.3 Champion International Corporation Management Incentive Program,
as amended, consisting of the Amended 1976 Incentive Stock Option
Plan and the Contingent Compensation Plan (filed by incorporation
by reference to Exhibit 4.3 to the Company's
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
Registration Statement on Form S-8, Commission Registration No.
2-77129).
+10.4 Resolutions of the Board of Directors of the Company adopted on
August 16, 1984 amending the Amended 1976 Incentive Stock Option
Plan (filed by incorporation by reference to Exhibit 10(b) to the
Company's Registration Statement on Form S-14, Commission
Registration No. 2-94030).
+10.5 Champion International Corporation Supplemental Retirement Income
Plan (filed by incorporation by reference to Exhibit 10.7 to the
Company's Form 10-K for the fiscal year ended December 31, 1989,
Commission File No. 1-3053).
*+10.6 Amendment dated as of January 1, 1994 to Champion International
Corporation Supplemental Retirement Income Plan.
+10.7 Champion International Corporation Nonqualified Supplemental
Savings Plan (filed by incorporation by reference to Exhibit 10.2
to the Company's Form 10-Q for the quarter ended September 30,
1994, Commission File No. 1-3053).
+10.8 Supplemental Retirement and Death Payments Agreement dated as of
August 1, 1964, as amended by letter agreement dated January 9,
1965, between the Company and Mr. Sigler (filed by incorporation
by reference to Exhibit 10.8 to the Company's Form 10-K for the
fiscal year ended December 31, 1990, Commission File No. 1-3053).
+10.9 Restated Agreement between the Company and Mr. Sigler, as amended
as of February 19, 1987, providing certain employment, severance
and retirement arrangements (filed by incorporation by reference
to Exhibit 19.1 to the Company's Form 10-Q for the quarter ended
June 30, 1987, Commission File No. 1-3053).
+10.10 Agreement Relating to Legal Expenses dated February 19, 1987
between the Company and Mr. Sigler providing reimbursement of
certain legal expenses following a change in control of the
Company (filed by incorporation by reference to Exhibit 19.2 to
the Company's Form 10-Q for the quarter ended June 30, 1987,
Commission File No. 1-3053).
+10.11 Amendment dated as of April 21, 1988 to Restated Agreement
between the Company and Mr. Sigler, as amended as of February 19,
1987 (filed by incorporation by reference to Exhibit 19.1 to the
Company's Form 10-Q for the quarter ended June 30, 1988,
Commission File No. 1-3053).
+10.12 Amendment dated as of August 18, 1988 to Restated Agreement
between the Company and Mr. Sigler, as amended as of February 19,
1987 (filed by incorporation by reference to Exhibit 10.10 to the
Company's Form 10-K for the fiscal year ended December 31, 1988,
Commission File No. 1-3053).
+10.13 Amendment dated as of August 18, 1988 to Agreement Relating to
Legal Expenses dated February 19, 1987 between the Company and
Mr. Sigler (filed by incorporation by reference to Exhibit 10.11
to the Company's Form 10-K for the fiscal year ended December 31,
1988, Commission File No. 1-3053).
+10.14 Amendment dated as of September 19, 1991 to Restated Agreement
between the Company and Mr. Sigler, as amended as of February 19,
1987 (filed by incorporation by reference to Exhibit 10.12 to the
Company's Form 10-K for the fiscal year ended December 31,
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
1991, Commission File No. 1-3053).
*+10.15 Amendment dated as of November 17, 1994 to Restated Agreement
between the Company and Mr. Sigler, as amended as of February 19,
1987.
*+10.16 Agreement dated November 17, 1994 between the Company and Mr.
Sigler relating to post-employment consulting services.
+10.17 Agreement dated as of August 18, 1988 between the Company and Mr.
Heist providing certain employment, severance and retirement
arrangements (filed by incorporation by reference to Exhibit
10.17 to the Company's Form 10-K for the fiscal year ended
December 31, 1988, Commission File No. 1-3053).
+10.18 Agreement Relating to Legal Expenses dated August 18, 1988
between the Company and Mr. Heist providing reimbursement of
certain legal expenses following a change in control of the
Company (filed by incorporation by reference to Exhibit 10.18 to
the Company's Form 10-K for the fiscal year ended December 31,
1988, Commission File No. 1-3053).
+10.19 Amendment dated as of September 19, 1991 to Agreement dated as of
August 18, 1988 between the Company and Mr. Heist (filed by
incorporation by reference to Exhibit 10.15 to the Company's Form
10-K for the fiscal year ended December 31, 1991, Commission File
No. 1-3053).
+10.20 Agreement dated as of October 18, 1990 between the Company and
Mr. Nichols providing certain employment, severance and
retirement arrangements (filed by incorporation by reference to
Exhibit 10.16 to the Company's Form 10-K for the fiscal year
ended December 31, 1990, Commission File No. 1-3053).
+10.21 Agreement Relating to Legal Expenses dated October 18, 1990
between the Company and Mr. Nichols providing reimbursement of
certain legal expenses following a change in control of the
Company (filed by incorporation by reference to Exhibit 10.17 to
the Company's Form 10-K for the fiscal year ended December 31,
1990, Commission File No. 1-3053).
+10.22 Amendment dated as of September 19, 1991 to Agreement dated as of
October 18, 1990 between the Company and Mr. Nichols (filed by
incorporation by reference to Exhibit 10.18 to the Company's Form
10-K for the fiscal year ended December 31, 1991, Commission File
No. 1-3053).
+10.23 Agreement dated as of February 19, 1987 between the Company and
Mr. Burchfield providing certain severance arrangements (filed by
incorporation by reference to Exhibit 10.15 to the Company's Form
10-K for the fiscal year ended December 31, 1987, Commission File
No. 1-3053).
+10.24 Agreement Relating to Legal Expenses dated February 19, 1987
between the Company and Mr. Burchfield providing reimbursement of
certain legal expenses following a change in control of the
Company (filed by incorporation by reference to Exhibit 10.16 to
the Company's Form 10-K for the fiscal year ended December 31,
1987, Commission File No. 1-3053).
+10.25 Amendment dated as of April 21, 1988 to Agreement dated as of
February 19, 1987 between the Company and Mr. Burchfield (filed
by incorporation by reference to Exhibit
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
19.5 to the Company's Form 10-Q for the quarter ended June 30,
1988, Commission File No. 1-3053).
+10.26 Amendment dated as of September 19, 1991 to Agreement dated as of
February 19, 1987 between the Company and Mr. Burchfield (filed
by incorporation by reference to Exhibit 10.22 to the Company's
Form 10-K for the fiscal year ended December 31, 1991, Commission
File No. 1-3053).
+10.27 Agreement dated as of August 18, 1988 between the Company and Mr.
Olson providing certain severance arrangements (filed by
incorporation by reference to Exhibit 10.23 to the Company's Form
10-K for the fiscal year ended December 31, 1990, Commission File
No. 1-3053).
+10.28 Agreement Relating to Legal Expenses dated August 18, 1988
between the Company and Mr. Olson providing reimbursement of
certain legal expenses following a change in control of the
Company (filed by incorporation by reference to Exhibit 10.24 to
the Company's Form 10-K for the fiscal year ended December 31,
1990, Commission File No. 1-3053).
+10.29 Amendment dated as of September 19, 1991 to Agreement dated as of
August 18, 1988 between the Company and Mr. Olson (filed by
incorporation by reference to Exhibit 10.28 to the Company's Form
10-K for the fiscal year ended December 31, 1991, Commission File
No. 1-3053).
+10.30 Trust Agreement dated as of February 19, 1987 between the Company
and Shawmut Bank Connecticut, N.A. securing certain payments
under the contracts listed as Exhibit Numbers 10.9 through 10.29,
among others, following a change in control of the Company (filed
by incorporation by reference to Exhibit 19.11 to the Company's
Form 10-Q for the quarter ended June 30, 1987, Commission File
No. 1-3053).
+10.31 Amendment dated as of August 18, 1988 to Trust Agreement dated as
of February 19, 1987 between the Company and Shawmut Bank
Connecticut, N.A. (filed by incorporation by reference to Exhibit
10.29 to the Company's Form 10-K for the fiscal year ended
December 31, 1988, Commission File No. 1-3053).
+10.32 Champion International Corporation Executive Life Insurance Plan
(filed by incorporation by reference to Exhibit 10.27 to the
Company's Form 10-K for the fiscal year ended December 31, 1990,
Commission File No. 1-3053).
*+10.33 Amendment dated as of January 1, 1994 to Champion International
Corporation Executive Life Insurance Plan.
10.34 Extract from the minutes of the meeting of the Board of
Directors of the Company held on October 18, 1979 relating to the
$50,000 of group term life insurance provided by the Company for
non-employee directors (filed by incorporation by reference to
Exhibit 10.28 to the Company's Form 10-K for the fiscal year
ended December 31, 1990, Commission File No. 1-3053).
10.35 Resolutions of the Board of Directors of the Company adopted on
September 19, 1991 relating to the compensation of directors
(filed by incorporation by reference to Exhibit 19 to the
Company's Form 10-Q for the quarter ended September 30, 1991,
Commission File No. 1-3053).
10.36 Resolutions of the Board of Directors of the Company adopted on
August 18, 1994 relating to the compensation of directors (filed
by incorporation by reference to Exhibit 10.1 to the Company's
Form 10-Q for the quarter ended September 30, 1994, Commission
File No. 1-3053).
10.37 Retirement Plan for Outside Directors (filed by incorporation by
reference to Exhibit 19 to the Company's Form 10-Q for the
quarter ended September 30, 1992, Commission File No. 1-3053).
*11 Schedule showing calculation of primary earnings per common share
and fully diluted earnings per common share.
*13 Portions of the Company's Annual Report which are specifically
incorporated by reference herein.
*21 List of significant subsidiaries of the Company.
*23.1 Opinion and Consent of the Senior Vice President and General
Counsel of the Company.
*23.2 Consent of Arthur Andersen LLP.
*24 Power of Attorney relating to the execution and filing of this
Annual Report on Form 10-K and all amendments hereto.
*27 Financial Data Schedule.