UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED NOVEMBER 29, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ..................to.....................
Commission File No. 0-3488
H.B. FULLER COMPANY
(Exact name of registrant as specified in its charter)
Minnesota 41-0268370
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or organization)
1200 WILLOW LAKE BOULEVARD, VADNAIS HEIGHTS, MINNESOTA 55110
(Address of principal executive offices) (Zip Code)
(612) 236-5900
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: Common Stock, par
value $1.00 per share
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 of 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. [ ]
The aggregate market value of the Common Stock, par value $1.00 per share, held
by non-affiliates of the Registrant as of January 30, 1998 was approximately
$677,282,000 (based on the closing price of such stock as quoted on the Nasdaq
National Market ($52.50) on such date).
The number of shares outstanding of the Registrant's Common Stock, par value
$1.00 per share, was 13,842,273 as of January 30, 1998.
DOCUMENTS INCORPORATED BY REFERENCE
Parts I, II and IV incorporate information by reference to portions of the H.B.
Fuller Company 1997 Annual Report to Shareholders.
Part III incorporates information by reference to portions of the Registrant's
Proxy Statement dated March 6, 1998.
H.B. FULLER COMPANY
1997 Form 10-K Annual Report
Table of Contents
PART I PAGE
------ ----
Item 1. Business 3
Item 2. Properties 6
Item 3. Legal Proceedings 7
Item 4. Submission of Matters to a Vote
of Security Holders 7
Executive Officers of the Registrant 8
PART II
-------
Item 5. Market for the Registrant's Common Stock
and Related Stockholder Matters 9
Item 6. Selected Financial Data 9
Item 7. Management's Discussion and Analysis of
Financial Condition and Results
of Operations 9
Item 7A. Quantitative and Qualitative Disclosures
About Market Risk 9
Item 8. Financial Statements and Supplementary Data 9
Item 9. Changes in and Disagreements With
Accountants on Accounting and
Financial Disclosure 9
PART III
--------
Item 10. Directors and Executive Officers
of the Registrant 10
Item 11. Executive Compensation 10
Item 12. Security Ownership of Certain Beneficial
Owners and Management 10
Item 13. Certain Relationships and
Related Transactions 10
PART IV
-------
Item 14. Exhibits, Financial Statement Schedules
and Reports on Form 8-K 11
Signatures 14
Schedule II - Valuation and
Qualifying Accounts 16
-2-
PART I
ITEM 1.
BUSINESS
- --------
Founded in 1887 and incorporated as a Minnesota corporation in 1915, H.B. Fuller
Company (the "Company") today is a worldwide manufacturer and marketer of
adhesives, sealants, coatings, paints and other specialty chemical products.
The Company currently employs approximately 6,000 people and has sales
operations in 42 countries in North America, Europe, Latin America and the
Asia/Pacific region.
The Company's largest worldwide business category is adhesives, sealants and
coatings, which generated more than 90 percent of 1997 sales. These products,
in thousands of formulations, are sold to customers in a wide range of
industries, including packaging, woodworking, automotive, aerospace, graphic
arts (books/magazines), appliances, filtration, windows, sporting goods,
nonwovens, shoes and ceramic tile.
The Company also is a quality producer and supplier of powder coatings to metal
finishing industries; commercial and industrial paints in Latin American
markets; specialty waxes in European markets, as well as mastics and coatings
for thermal insulation, indoor air quality and asbestos abatement applications
in the United States.
SEGMENT INFORMATION
- -------------------
For financial information relating to major geographic areas of the Company, see
Note 14, "Business Segment Information", on pages 45 and 46 of the Company's
1997 Annual Report to Shareholders, incorporated herein by reference.
LINE OF BUSINESS AND CLASSES OF SIMILAR PRODUCTS
- ------------------------------------------------
The Company is engaged in one line of business, the manufacturing of specialty
chemical products which includes formulating, compounding and marketing
adhesives, sealants and coatings, paints, specialty waxes and related chemicals.
The following tabulation sets forth information concerning the approximate
contribution to consolidated sales of the Company's classes of products:
CLASS OF PRODUCT Sales
- ---------------- -----------------------------------------
1997 1996 1995
---- ---- ----
Adhesives, sealants and coatings 90% 88% 87%
Paints 7 7 7
Other 3 5 6
---- ---- ----
100% 100% 100%
==== ==== ====
NON-U.S. OPERATIONS
- -------------------
Wherever feasible, the Company's practice has been to establish manufacturing
units outside of the United States to service the local markets. The principal
markets, products and methods of distribution in the non-U.S. business vary with
the country or business practices of the country. The products sold include not
only those developed by the local manufacturing plants but also those developed
within the United States and elsewhere in the world.
The Company's operations overseas face varying degrees of economic and political
risk. At the end of fiscal year 1997, the Company had plants in 30 countries
outside the United States and satellite sales offices in another 11 countries.
The Company also uses license agreements to maintain a worldwide manufacturing
network. In the opinion of management of the Company, there are several
countries where the Company has operating facilities which have political risks
higher than in the United States. Where possible, the Company insures its
physical assets against damage from civil unrest.
-3-
COMPETITION
- -----------
The Company encounters a high degree of competition in the marketing of its
products. Because of the large number and variety of its products, the Company
does not compete directly with any one competitor in all of its markets. The
Company competes with several large firms as well as many smaller local,
independent firms. In North America there are a large number of competitors.
Since adhesives of all types are widely used, it is not possible to identify a
few competitors who would represent the major competition.
In Latin America, the Company experiences substantial competition in marketing
its printing inks and industrial adhesives. In Central America, it is a major
factor in the industrial adhesives market and, along with several other large
paint manufacturing firms, in the residential paint market. In Europe, the
Company is a large manufacturer of adhesives and specialty waxes and competes in
certain areas of this market with several large companies.
The principal competitive factors in the sale of adhesives, paints, coatings and
sealants are product performance, customer and technical service, quality and
price.
CUSTOMERS
- ---------
Of the Company's $1,306,789,000 total sales to unaffiliated customers in 1997,
$722,104,000 was sold through North American operations. The Company's largest
customer accounts for less than 5% of consolidated sales.
BACKLOG
- -------
Orders for the Company's products are generally processed within one week.
Therefore, the Company had no significant backlog of unfilled orders at November
29, 1997, November 30, 1996 or November 30, 1995.
RAW MATERIALS
- -------------
The Company purchases from large chemical suppliers raw materials including
solvents, plasticizers, waxes, resins, polymers and vinyl acetate monomer which
the Company uses to manufacture its principal products. Natural raw materials
are also purchased from outside suppliers and include starch, dextrines, natural
latex and resins. The Company attempts to find multiple sources for all of its
raw materials and alternate sources of supply are generally available. An
adequate supply of the raw materials used by the Company is presently available
in the open market. The Company's Latin American and Asia/Pacific operations
import many of their raw materials. Extended delivery schedules of these
materials are common, thereby requiring maintenance of higher inventory levels
than those maintained in North America and Europe.
A significant portion of the Company's raw materials are derived from petroleum-
based products and this is common to all adhesive manufacturers.
The Company is not a large consumer of energy and, therefore, has not
experienced any difficulties in obtaining energy for its manufacturing
operations. The Company anticipates it will be able to obtain needed energy
supplies in the future.
PATENTS, TRADEMARKS AND LICENSES
- --------------------------------
Much of the technology used in the manufacturing of adhesives, coatings and
other specialty chemicals is in the public domain. To the extent that it is
not, the Company relies on trade secrets and patents to protect its know-how.
The Company has agreements with many of its employees for the purpose of
protecting the Company's rights to technology and intellectual property. The
Company also routinely obtains confidentiality commitments from customers,
suppliers and others to safeguard its proprietary information. Company
trademarks such as HB Fuller(R), Kativo(R), Protecto(R) and Rakoll(R) are of
continuing importance in marketing its products.
-4-
RESEARCH AND DEVELOPMENT
- ------------------------
The Company conducts research and development activities in an effort to improve
existing products and to design new products and processes. The Company's
research and development expenses during 1997, 1996 and 1995 aggregated
$24,830,000, $25,823,000 and $26,541,000, respectively.
ENVIRONMENTAL PROTECTION
- ------------------------
The Company regularly reviews and upgrades its environmental policies, practices
and procedures and seeks improved production methods that reduce waste,
particularly toxic waste, coming out of its facilities, based upon evolving
societal standards and increased environmental understanding.
The Company's high standards of environmental consciousness are supported by an
organizational program supervised by environmental professionals and the
Worldwide Environment, Health and Safety Committee, a committee with management
membership from around the world which proactively monitors practices at all
facilities. Company practices are often more stringent than local government
standards. The Company integrates environmental programs into operating
objectives, thereby translating philosophy into every day practice.
The Company believes that as a general matter its current policies, practices
and procedures in the areas of environmental regulations and the handling of
hazardous waste are designed to substantially reduce risks of environmental and
other damage that would result in litigation and financial liability. Some risk
of environmental and other damage is, however, inherent in particular operations
and products of the Company, as it is with other companies engaged in similar
businesses.
The Company is and has been engaged in the handling, manufacture, use, sale
and/or disposal of substances, some of which are considered by federal or state
environmental agencies to be hazardous. The Company believes that its
manufacture, handling, use, sale and disposal of such substances are generally
in accord with current applicable environmental regulations. Increasingly
strict environmental laws, standards and enforcement policies may increase the
risk of liability and compliance costs associated with such substances.
Environmental expenditures, reasonably known to management, to comply with
environmental regulations over the Company's next two fiscal years are estimated
to be approximately $12.0 million. The effects of compliance with environmental
laws and regulations are not expected to be material to the Company's
consolidated capital expenditures, earnings or competitive position. See
additional disclosure under Item 3, Legal Proceedings.
EMPLOYEES
- ---------
The Company and its consolidated subsidiaries employed approximately 6,000
persons on November 29, 1997, of which approximately 2,300 persons were employed
in the United States.
-5-
ITEM 2.
PROPERTIES
- ----------
The principal manufacturing plants and other properties are located in 31
countries:
U.S. LOCATIONS
--------------
California Massachusetts - Wilmington
Chatsworth Michigan
Los Angeles (1 owned, 1 leased) Grand Rapids
Roseville Warren
Florida Minnesota
Gainesville Minneapolis and St. Paul
Pompano Beach (7 owned, 2 leased)
Georgia New Jersey - Edison
Conyers* (1 owned, 1 leased)
Covington (2 owned) North Carolina - Greensboro
Forest Park Ohio
Tucker Cincinnati
Illinois Dayton
Palatine Tennessee - Memphis*
Tinley Park Texas
Indiana - Elkhart Dallas
Kansas - Kansas City Houston
Kentucky Washington - Vancouver
Hopkinsville
Paducah
OTHER LOCATIONS
---------------
Argentina - Buenos Aires Honduras
Australia San Pedro Sula (2 owned)
Melbourne Italy - Borgolavezzaro
Austria - Wels Japan - Hamamatsu
Brazil - Sao Paulo Mexico - Mexico City*
Canada Netherlands - Amerongen
St. Andre est New Zealand - Auckland (2 owned)
Montreal Nicaragua - Managua
Toronto People's Republic of
Chile - Santiago China - Guangzhou*
Colombia - Itagui* Peru - Lima
Costa Rica - San Jose (5 owned) Philippines - Manila*
Dominican Republic - Santo Domingo Puerto Rico - Bayamon
Ecuador - Guayaquil (2 owned) Republic of Panama - Panama City
El Salvador - San Salvador Spain - Alicante
Federal Republic of Germany Taiwan - Taipei
Luneburg United Kingdom
Nienburg* Birmingham*
France - Le Trait Leabrooks*
Guatemala - Guatemala City Venezuela - Caracas
*Leased properties
-6-
The Company's principal executive offices and central research facilities are
Company owned and located in the St. Paul, Minnesota metropolitan area.
The Company has facilities for the manufacture of various products with total
floor space of approximately 1,698,000 square feet, including 294,000 square
feet of leased space. In addition, the Company has approximately 2,039,000
square feet of warehouse space, including 531,000 square feet of leased space.
Offices and other facilities total 1,920,000 square feet, including 578,000
square feet of leased space. The Company believes that the properties owned or
leased are suitable and adequate for its business.
ITEM 3.
LEGAL PROCEEDINGS
- -----------------
ENVIRONMENTAL REMEDIATION
- -------------------------
The Company is subject to the federal Comprehensive Environmental Response,
Compensation and Liability Act ("CERCLA") and similar state laws that impose
liability for costs relating to the clean-up of contamination resulting from
past spills, disposal or other release of hazardous substances. The Company is
currently involved in administrative proceedings or lawsuits under CERCLA or
such state laws relating to clean-up of 16 sites. The future costs in
connection with all of these matters have not been determined due to such
factors as the unknown timing and extent of the remedial actions which may be
required, the full extent of clean-up costs and the amount of the Company's
liability in consideration of the liability and financial resources of the other
potentially responsible parties. However, based on currently available
information, the Company does not believe that any liabilities allocated to it
in these administrative proceedings or lawsuits, individually or in the
aggregate, will have a material adverse effect on the Company's business or
financial condition.
The Company has received requests for information from federal, state or local
government entities regarding six other contaminated sites. The Company has not
been named a party to any administrative proceedings or lawsuits relating to the
clean-up of these sites.
From time to time the Company becomes aware of compliance matters relating to,
or receives notices from federal, state or local entities regarding, possible or
alleged violations of environmental, health or safety laws and regulations. In
some instances, these matters may become the subject of administrative
proceedings or lawsuits and may involve monetary sanctions of $100,000 or more
(exclusive of interest and costs). Based on currently available information,
the Company does not believe that such compliance matters or alleged violations
of laws and regulations, individually or in the aggregate, will have a material
adverse effect on the Company's business or financial condition.
OTHER LEGAL PROCEEDINGS
- -----------------------
In November 1997, the Company was named one of approximately 78 defendants
(along with numerous other chemical companies) in a purported class action filed
in Texas State Court on behalf of 700 plaintiffs. The plaintiffs claim that the
defendants allowed toxic and hazardous wastes, substances and chemicals to
escape from a television assembly plant in Athens, Texas into the ground, water
and air in the vicinity of the plant. However, no Company products have been
identified as contributing to the claimed damages.
In addition, the Company is subject to other legal proceedings incidental to its
business.
Based on currently available information, the Company does not believe that an
adverse outcome in any pending legal proceedings individually or in the
aggregate would have a material adverse effect on the Company's business or
financial condition.
ITEM 4.
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
- ---------------------------------------------------
Not applicable.
-7-
EXECUTIVE OFFICERS OF THE REGISTRANT
- ------------------------------------
The executive officers of the Company as of November 29, 1997 and their ages and
current offices are set forth below:
NAME AGE POSITION PERIOD SERVED
- ----------------------- --- -------------------------------------------- -------------
Anthony L. Andersen 61 Chair, Board of Directors Since 1992
Director Since 1966
Walter Kissling 66 President Since 1992
Chief Executive Officer Since 1995
Director Since 1968
Jorge Walter Bolanos 53 Chief Financial Officer and Treasurer Since 1992
Senior Vice President Since 1995
Lars T. Carlson 59 Senior Vice President - Administration Since 1996
Vice President Since 1986
John T. Ray, Jr. 60 Senior Vice President - North American Since 1984
Adhesives, Sealants and Coatings Group
Jerald L. Scott 56 Senior Vice President - Operations Since 1996
Vice President Since 1980
Richard C. Baker 45 Vice President Since 1993
Corporate Secretary Since 1995
General Counsel Since 1990
Sarah R. Coffin 45 Vice President - Specialty Group Manager Since 1994
Hermann Lagally 56 Group President - Europe Since 1996
Division Manager Since 1994
Regional Manager Since 1980
Antonio Lobo 54 Vice President - Latin America Group Manager Since 1989
Alan R. Longstreet 51 Vice President - Asia/Pacific Group Manager Since 1986
David J. Maki 56 Vice President Since 1990
Controller Since 1987
Rolf Schubert 59 Vice President - Chief Technology Officer Since 1982
Director Since 1972
Officers are elected by the Board of Directors or appointed by the Chief
Executive Officer. Each of the Company's officers has served in various
capacities with the Company for more than five years, except Sarah R. Coffin.
Sarah R. Coffin joined the Company and was named Vice President/Specialty Group
Manager in 1994. In her most recent position prior to joining the Company, Ms.
Coffin served as Managing Director, Specialty Chemicals, General Electric
Plastics, a position she had held since 1991.
-8-
PART II
Information for Items 5 through 8 of this report appear in the 1997 H.B. Fuller
Company Annual Report to Shareholders as indicated in the following table and is
incorporated herein by reference to the applicable portions of such Annual
Report:
ANNUAL
REPORT TO
SHAREHOLDERS
Page
----
ITEM 5.
Market for Registrant's Common Stock
- ------------------------------------
and Related Stockholder Matters
-------------------------------
Trading Market 52
High and Low Market Value 52
Dividend Payments 52
Dividend Restrictions (Note 13) 43
Holders of Common Stock 53
ITEM 6.
Selected Financial Data
- -----------------------
1969 - 1997 in Review and
Selected Financial Data 48-50
ITEM 7.
Management's Discussion and Analysis of
- ---------------------------------------
Financial Condition and Results of Operations
---------------------------------------------
Management's Analysis of Results of
Operations and Financial Condition 25-31
ITEM 7A.
Quantitative and Qualitative Disclosures
- ----------------------------------------
About Market Risk
-----------------
Not applicable.
ITEM 8.
Financial Statements and Supplementary Data
- -------------------------------------------
Consolidated Financial Statements 32-46
Quarterly Data (Unaudited)(Note 15) 46
ITEM 9.
Changes in and Disagreements With Accountants
- ---------------------------------------------
on Accounting and Financial Disclosure
--------------------------------------
None
-9-
PART III
ITEMS 10.
DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
- --------------------------------------------------
The information under the heading "Election of Directors" (but not including the
sections entitled "Directors' Compensation" and "Board Meetings and Committees")
and the section entitled "Section 16(a) Beneficial Ownership Reporting
Compliance" contained in the Company's Proxy Statement dated March 6, 1998 (the
"1998 Proxy Statement") are incorporated herein by reference.
The information contained at the end of Part I hereof under the heading
"Executive Officers of the Registrant" is incorporated herein by reference.
ITEMS 11.
EXECUTIVE COMPENSATION
- ----------------------
The section under the heading "Election of Directors" entitled "Directors'
Compensation" and the sections under the heading "Executive Compensation"
entitled "Summary Compensation Table," "Long-Term Incentive Plans - Awards in
Last Fiscal Year," "Aggregated Option Exercises in Fiscal Year 1997 and Fiscal
Year End Option Values," "Retirement Plans," "Employment Agreements" and "Change
in Control Arrangements" contained in the 1998 Proxy Statement are incorporated
herein by reference.
ITEMS 12.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
- --------------------------------------------------------------
The information under the heading "Security Ownership of Certain Beneficial
Owners and Management" contained in the 1998 Proxy Statement is incorporated
herein by reference.
ITEMS 13.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
- ----------------------------------------------
The section entitled "Exchange Agreement" contained in the 1998 Proxy Statement
is incorporated herein by reference.
-10-
PART IV
Item 14.
Exhibits, Financial Statement Schedules and Reports on Form 8-K
- ---------------------------------------------------------------
Reference
-------------------------------
Form 10-K Annual Report
Annual Report to Shareholders
Page Page
---------- --------------
(A)(1.) INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
INCORPORATED BY REFERENCE TO THE APPLICABLE
PORTIONS OF THE 1997 ANNUAL REPORT TO
SHAREHOLDERS OF H.B. FULLER COMPANY:
Consolidated Statements of Earnings for the
Three Years Ended November 29, 1997,
November 30, 1996 and November 30, 1995 32
Consolidated Balance Sheets as of
November 29, 1997 and November 30, 1996 33
Consolidated Statements of Stockholders' Equity
for the Three Years Ended November 29, 1997,
November 30, 1996 and November 30, 1995 34
Consolidated Statements of Cash Flows
for the Three Years Ended November 29, 1997,
November 30, 1996 and November 30, 1995 35
Notes to Consolidated Financial Statements 36-46
Report of Independent Accountants 47
(A)(2.) INDEX TO CONSOLIDATED FINANCIAL STATEMENT
SCHEDULES FOR THE THREE YEARS ENDED NOVEMBER 29, 1997,
NOVEMBER 30, 1996 AND NOVEMBER 30, 1995:
Report of Independent Accountants on Financial
Statement Schedules 15
Schedule II Valuation and Qualifying Accounts 16
All other financial statement schedules are omitted as the required information
is inapplicable or the information is given in the financial statements or
related notes.
-11-
(A)(3.) EXHIBITS
--------
EXHIBIT NUMBER
3(a) Restated Articles of Incorporation - incorporated by reference to
Exhibit 3(a) to the Registrant's Annual Report on Form 10-K for the year
ended November 30, 1992.
3(b) By-Laws of H.B. Fuller Company - incorporated by reference to Exhibit
3(b) to the Registrant's Annual Report on Form 10-K for the year ended
November 30, 1995.
4(a) Rights Agreement, dated as of July 18, 1996, between H.B. Fuller Company
and Norwest Bank Minnesota, National Association, as Rights Agent, which
includes as an exhibit the form of Right Certificate, incorporated by
reference to Exhibit 4 to the Registrant's Form 8-K, dated July 24,
1996.
4(b) Restated Articles of Incorporation referring to rights of security
holders, Articles III, VII - incorporated by reference to Exhibit 4(b)
to the Registrant's Annual Report on Form 10-K for the year ended
November 30, 1992.
4(c) Specimen Stock Certificate - incorporated by reference to Exhibit 4(c)
to the Registrant's Annual Report on Form 10-K for the year ended
November 30, 1995.
4(d) Stock Exchange Agreement, dated July 18, 1996, between H.B. Fuller
Company and Elmer L. Andersen, including Designations for Series B
Preferred Stock, incorporated by reference to Exhibit 10 to the
Registrant's Form 8-K, dated July 24, 1996.
*10(a) H.B. Fuller Company 1992 Stock Incentive Plan - incorporated by
reference to Exhibit 10(a) to the Registrant's Annual Report on Form 10-
K for the year ended November 30, 1992.
*10(b) H.B. Fuller Company Restricted Stock Plan - incorporated by reference to
Exhibit 10(c) to the Registrant's Annual Report on Form 10-K for the
year ended November 30, 1993.
*10(c) H.B. Fuller Company Restricted Stock Unit Plan - incorporated by
reference to Exhibit 10(d) to the Registrant's Annual Report on Form 10-
K for the year ended November 30, 1993.
*10(d) Directors' Stock Plan - incorporated by reference to Exhibit 10(d) to
the Registrant's Annual Report on Form 10-K405 for the year ended
November 30, 1994.
*10(e) H.B. Fuller Company 1987 Stock Incentive Plan - incorporated by
reference to Exhibit 4(a) to the Registrant's Registration Statement on
Form S-8 (Commission File No. 33-16082).
*10(f) H.B. Fuller Company Nonqualified Retirement Plan for Costa Rica -
incorporated by reference to Exhibit 10(f) to the Registrant's Annual
Report on Form 10-K for the year ended November 30, 1988 (Commission
File No. 0-3488).
*10(g) Form of Employment Agreement signed by executive officers - incorporated
by reference to Exhibit 10(e) to the Registrant's Annual Report on Form
10-K for the year ended November 30, 1990 (Commission File No. 0-3488).
*10(h) Pension Plan Agreement with Dr. Hermann Lagally signed February 5, 1980
(English translation) - incorporated by reference to Exhibit 10(h) to
the Registrant's Annual Report on Form 10-K for the year ended November
30, 1996.
*10(i) Managing Director Agreement with Dr. Hermann Lagally signed December 1,
1995 - incorporated by reference to Exhibit 10(i) to the Registrant's
Annual Report on Form 10-K for the year ended November 30, 1996.
-12-
(A)(3.) EXHIBITS (CONTINUED)
--------
*10(j) H.B. Fuller Company Supplemental Executive Retirement Plan -incorporated
by reference to Exhibit 10(j) to the Registrant's Annual Report on Form
10-K for the year ended November 30, 1992.
*10(k) H.B. Fuller Company Executive Benefit Trust, dated October 25, 1993,
between H.B. Fuller Company and First Trust National Association, as
Trustee, relating to the H.B. Fuller Company Supplemental Executive
Retirement Plan.
*10(l) Deferred Compensation Agreement dated December 22, 1994, between H.B.
Fuller Company and Walter Kissling - incorporated by reference to
Exhibit 10(m) to the Registrant's Annual Report on Form 10-K405 for the
year ended November 30, 1994.
*10(m) First Amendment to Deferred Compensation Agreement dated December 22,
1994, between H.B. Fuller Company and Walter Kissling.
*10(n) Deferred Compensation Agreement dated May 5, 1997, between H.B. Fuller
Company and Walter Kissling.
*10(o) Split-Dollar Insurance Agreement, dated May 5, 1997, between H.B. Fuller
Company and Jorge Walter Bolanos, as Trustee of the Walter Kissling
Irrevocable Trust Agreement dated May 5, 1997.
*10(p) Retirement Plan for Directors of H.B. Fuller Company - incorporated by
reference to Exhibit 10(n) to the Registrant's Annual Report on Form 10-
K405 for the year ended November 30, 1994.
*10(q) 1996 Performance Unit Plan - incorporated by reference to Exhibit 10(n)
to the Registrant's Annual Report on Form 10-K for the year ended
November 30, 1996.
* Asterisked items are management contracts or compensatory plans or
arrangements required to be filed as an exhibit to this Form 10-K pursuant to
Item 14(c) of this Form 10-K.
11 Statement re: Computation of Net Earnings Per Common Share
13 Pages 25-53 of the 1997 Annual Report to Shareholders
21 Subsidiaries of the Registrant
23 Consent of Price Waterhouse LLP
24 Manually signed Powers of Attorney
27 Financial Data Schedule
(B) REPORTS ON FORM 8-K
-------------------
No reports on Form 8-K were filed during the fourth quarter of the fiscal
year ended November 29, 1997.
(C) SEE EXHIBIT INDEX AND EXHIBITS ATTACHED TO THIS FORM 10-K.
----------------------------------------------------------
(D) SEE FINANCIAL STATEMENT SCHEDULE INCLUDED AT THE END OF THIS FORM 10-K.
-----------------------------------------------------------------------
-13-
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.
H.B. FULLER COMPANY
Dated: February 26, 1998 By /s/ Walter Kissling
----------------------------
WALTER KISSLING
President and
Chief Executive Officer
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 dates indicated:
SIGNATURE TITLE
--------- -----
/s/ Walter Kissling President and
- ------------------------ Chief Executive Officer and Director
WALTER KISSLING (Principal Executive Officer)
/s/ Jorge Walter Bolanos Senior Vice President,
- -------------------------- Chief Financial Officer and Treasurer
JORGE WALTER BOLANOS (Principal Financial Officer)
/s/ David J. Maki Vice President
- -------------------------- and Controller
DAVID J. MAKI (Principal Accounting Officer)
*ANTHONY L. ANDERSEN Chair, Board of Directors and Director
*NORBERT R. BERG Director
*EDWARD L. BRONSTIEN, JR. Director
*FREEMAN A. FORD Director
*GAIL D. FOSLER Director
*REATHA CLARK KING Director
*JOHN J. MAURIEL, JR. Director
*LEE R. MITAU Director
*ROLF SCHUBERT Vice President and Director
*LORNE C. WEBSTER Director
By: /s/ Richard C. Baker Dated: February 26, 1998
- -----------------------------
RICHARD C. BAKER
Attorney in Fact
* Power of Attorney filed with this report as Exhibit 24 hereto.
-14-
REPORT OF INDEPENDENT ACCOUNTANTS ON
------------------------------------
FINANCIAL STATEMENT SCHEDULES
-----------------------------
TO THE BOARD OF DIRECTORS
OF H.B. FULLER COMPANY
Our audits of the consolidated financial statements referred to in our report
dated January 11, 1998 appearing in the 1997 Annual Report to Stockholders of
H.B. Fuller Company (which report and consolidated financial statements are
incorporated by reference in this Annual Report on Form 10-K) also included an
audit of the Financial Statement Schedules listed in Item 14(a) of this Form 10-
K. In our opinion, these Financial Statement Schedules present fairly, in all
material respects, the information set forth therein when read in conjunction
with the related consolidated financial statements.
Price Waterhouse LLP
Minneapolis, Minnesota
January 11, 1998
-15-
Schedule II
-----------
H.B. Fuller Company and Consolidated Subsidiaries
Valuation and Qualifying Accounts
(Dollars in thousands)
Allowance for doubtful receivables
------------------------------------------------------
November 29, November 30, November 30,
Years Ended 1997 1996 1995
- ----------------------------------- -------------- -------------- --------------
Balance at beginning of period $7,043 $6,256 $6,221
Additions(deductions):
Charged to costs and expenses 1,183 2,745 1,954
Accounts charged off during year (1,991) (1,897) (2,073)
Accounts of business sold (88) - -
Effect of currency exchange rate
changes on beginning of year
balance (268) (61) 154
------------- ------------- -------------
Balance at end of period $5,879 $7,043 $6,256
============= ============= =============
-16-
EXHIBIT INDEX
EXHIBIT NUMBER
3(a) Restated Articles of Incorporation - incorporated by reference to Exhibit
3(a) to the Registrant's Annual Report on Form 10-K for the year ended
November 30, 1992.
3(b) By-Laws of H.B. Fuller Company - incorporated by reference to Exhibit 3(b)
to the Registrant's Annual Report on Form 10-K for the year ended November
30, 1995.
4(a) Rights Agreement, dated as of July 18, 1996, between H.B. Fuller Company
and Norwest Bank Minnesota, National Association, as Rights Agent, which
includes as an exhibit the form of Right Certificate, incorporated by
reference to Exhibit 4 to the Registrant's Form 8-K, dated July 24, 1996.
4(b) Restated Articles of Incorporation referring to rights of security
holders, Articles III, VII - incorporated by reference to Exhibit 4(b) to
the Registrant's Annual Report on Form 10-K for the year ended November
30, 1992.
4(c) Specimen Stock Certificate - incorporated by reference to Exhibit 4(c) to
the Registrant's Annual Report on Form 10-K for the year ended November
30, 1995.
4(d) Stock Exchange Agreement, dated July 18, 1996, between H.B. Fuller Company
and Elmer L. Andersen, including Designations for Series B Preferred
Stock, incorporated by reference to Exhibit 10 to the Registrant's Form 8-
K, dated July 24, 1996.
10(a) H.B. Fuller Company 1992 Stock Incentive Plan - incorporated by reference
to Exhibit 10(a) to the Registrant's Annual Report on Form 10-K for the
year ended November 30, 1992.
10(b) H.B. Fuller Company Restricted Stock Plan - incorporated by reference to
Exhibit 10(c) to the Registrant's Annual Report on Form 10-K for the year
ended November 30, 1993.
10(c) H.B. Fuller Company Restricted Stock Unit Plan - incorporated by reference
to Exhibit 10(d) to the Registrant's Annual Report on Form 10-K for the
year ended November 30, 1993.
10(d) Directors' Stock Plan - incorporated by reference to Exhibit 10(d) to the
Registrant's Annual Report on Form 10-K405 for the year ended November 30,
1994.
10(e) H.B. Fuller Company 1987 Stock Incentive Plan - incorporated by reference
to Exhibit 4(a) to the Registrant's Registration Statement on Form S-8
(Commission File No. 33-16082).
10(f) H.B. Fuller Company Nonqualified Retirement Plan for Costa Rica -
incorporated by reference to Exhibit 10(f) to the Registrant's Annual
Report on Form 10-K for the year ended November 30, 1988 (Commission File
No. 0-3488).
10(g) Form of Employment Agreement signed by executive officers - incorporated
by reference to Exhibit 10(e) to the Registrant's Annual Report on Form
10-K for the year ended November 30, 1990 (Commission File No. 0-3488).
10(h) Pension Plan Agreement with Dr. Hermann Lagally signed February 5, 1980
(English translation) - incorporated by reference to Exhibit 10(h) to the
Registrant's Annual Report on Form 10-K for the year ended November 30,
1996.
10(i) Managing Director Agreement with Dr. Hermann Lagally signed December 1,
1995 - incorporated by reference to Exhibit 10(i) to the Registrant's
Annual Report on Form 10-K for the year ended November 30, 1996.
(A)(3.) EXHIBITS (CONTINUED)
--------
10(j) H.B. Fuller Company Supplemental Executive Retirement Plan - incorporated
by reference to Exhibit 10(j) to the Registrant's Annual Report on Form
10-K for the year ended November 30, 1992.
10(k) H.B. Fuller Company Executive Benefit Trust, dated October 25, 1993,
between H.B. Fuller Company and First Trust National Association, as
Trustee, relating to the H.B. Fuller Company Supplemental Executive
Retirement Plan.
10(l) Deferred Compensation Agreement dated December 22, 1994, between H.B.
Fuller Company and Walter Kissling - incorporated by reference to Exhibit
10(m) to the Registrant's Annual Report on Form 10-K405 for the year ended
November 30, 1994.
10(m) First Amendment to Deferred Compensation Agreement dated December 22,
1994, between H.B. Fuller Company and Walter Kissling.
10(n) Deferred Compensation Agreement dated May 5, 1997, between H.B. Fuller
Company and Walter Kissling.
10(o) Split-Dollar Insurance Agreement, dated May 5, 1997, between H.B. Fuller
Company and Jorge Walter Bolanos, as Trustee of the Walter Kissling
Irrevocable Trust Agreement dated May 5, 1997.
10(p) Retirement Plan for Directors of H.B. Fuller Company - incorporated by
reference to Exhibit 10(n) to the Registrant's Annual Report on Form 10-
K405 for the year ended November 30, 1994.
10(q) 1996 Performance Unit Plan - incorporated by reference to Exhibit 10(n) to
the Registrant's Annual Report on Form 10-K for the year ended November
30, 1996.
11 Statement re: Computation of Net Earnings Per Common Share
13 Pages 25-53 of the 1997 Annual Report to Shareholders.
21 Subsidiaries of the Registrant
23 Consent of Price Waterhouse LLP
24 Manually signed Powers of Attorney
27 Financial Data Schedule