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ý
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Ohio
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34-1919973
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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6070 Parkland Blvd.,
Mayfield Heights, Ohio
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44124
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(Address of principal executive offices)
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(Zip Code)
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Title of Each Class
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Name of Each Exchange on Which Registered
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Common Stock, no par value
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New York Stock Exchange
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Large accelerated filer
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¨
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Accelerated filer
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ý
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Non-accelerated filer
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¨
(Do not check if a smaller reporting company)
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Smaller reporting company
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¨
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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Item 15.
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||
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•
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Actual sales, operating rates and margins for 2013;
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•
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Uncertainties relating to the fourth quarter 2012 physical inventory and possible theft at our Albuquerque facility, including (i) the outcome of our investigations and (ii) the timing and amount, if any, of any insurance proceeds that we might receive;
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•
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The global economy;
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•
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The condition of the markets that we serve, whether defined geographically or by segment, with the major market segments being: consumer electronics, industrial components and commercial aerospace, defense and science, medical, energy, automotive electronics, telecommunications infrastructure and appliance;
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•
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Changes in product mix and the financial condition of customers;
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•
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Our success in developing and introducing new products and new product ramp-up rates;
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•
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Our success in passing through the costs of raw materials to customers or otherwise mitigating fluctuating prices for those materials, including the impact of fluctuating prices on inventory values;
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•
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Our success in integrating acquired businesses, including EIS Optics Limited (EIS) and Aerospace Metal Composites Limited (AMC);
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•
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Our success in completing the announced facility consolidations and achieving the expected benefits;
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•
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Our success in implementing our strategic plans and the timely and successful completion and start-up of any capital projects, including the new primary beryllium facility in Elmore, Ohio;
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•
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The availability of adequate lines of credit and the associated interest rates;
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•
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Other financial factors, including the cost and availability of raw materials (both base and precious metals), physical inventory valuations (including the impact of losses due to theft), metal financing fees, tax rates, exchange rates, pension costs and required cash contributions and other employee benefit costs, energy costs, regulatory compliance costs, the cost and availability of insurance, and the impact of our stock price on the cost of incentive compensation plans;
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•
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The uncertainties related to the impact of war, terrorist activities and acts of God;
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•
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Changes in government regulatory requirements and the enactment of new legislation that impacts our obligations and operations;
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•
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The conclusion of pending litigation matters in accordance with our expectation that there will be no material adverse effects;
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•
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The timing and ability to achieve further efficiencies and synergies resulting from our name change and product line alignment under the Materion name and Materion brand; and
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•
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The risk factors set forth elsewhere in Item 1A of this Form 10-K.
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Item 1.
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BUSINESS
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•
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Strip products
, the largest of the product families, include thin gauge precision strip and thin diameter rod and wire. These copper and nickel alloys provide a combination of high conductivity, high reliability and formability for use as connectors, contacts, switches, relays and shielding. Major markets for strip products include consumer electronics, telecommunications infrastructure, automotive electronics, appliance and medical. Performance Alloys’ primary direct competitor in strip form beryllium alloys is NGK Insulators, Ltd. of Nagoya, Japan, with subsidiaries in the United States and Europe. Performance Alloys also competes with alloy systems manufactured by Global Brass and Copper, Inc., Wieland Electric, Inc., Stolberger Metallwerke GmbH, Nippon Mining, PMX Industries, Inc. and also with other generally less expensive materials, including phosphor bronze, stainless steel and other specialty copper and nickel alloys, which are produced by a variety of companies around the world;
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•
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Bulk products
are copper and nickel-based alloys manufactured in plate, rod, bar, tube and other customized forms that, depending upon the application, may provide superior strength, corrosion or wear resistance, thermal conductivity or lubricity. While the majority of bulk products contain beryllium, a growing portion of bulk products' sales is from non-beryllium-containing alloys as a result of product diversification efforts. Applications for bulk products include oil and gas drilling components, bearings, bushings, welding rods, plastic mold tooling and undersea telecommunications housing equipment. Major markets for bulk products include industrial components and commercial aerospace, energy and telecommunications infrastructure. In the area of bulk products, in addition to NGK Insulators, Ltd., Performance Alloys competes with several smaller regional producers such as International Beryllium Corp., Ningxia Orient Tantalum in China and LeBronze Industriel in Europe; and
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•
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Beryllium hydroxide
is produced at our milling operations in Utah from our bertrandite mine and purchased beryl ore. The hydroxide is used primarily as a raw material input for strip and bulk products and, to a lesser extent, by the Beryllium and Composites segment. Sales of beryllium hydroxide to NGK Insulators, Ltd. from the Utah operations were less than 4% of Performance Alloys’ total sales in each of the four most recent years.
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Name
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Age
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Positions and Offices
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|
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Richard J. Hipple
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60
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Chairman of the Board, President and Chief Executive Officer
.
In May 2006, Mr. Hipple was named Chairman of the Board and Chief Executive Officer of Materion Corporation. He had served as President since May 2005. He was Chief Operating Officer from May 2005 until May 2006. Mr. Hipple served as President of Performance Alloys from May 2002 until May 2005. He joined the Company in July 2001 as Vice President of Strip Products, Performance Alloys and served in that position until May 2002. Prior to joining Materion, Mr. Hipple was President of LTV Steel Company, a business unit of the LTV Corporation (integrated steel producer and metal fabricator). Prior to running LTV’s steel business, Mr. Hipple held numerous leadership positions in engineering, operations, strategic planning, sales and marketing and procurement since 1975 at LTV. Mr. Hipple has served on the Board of Directors of Ferro Corporation since 2007 and as its Lead Director since April 2010. Mr. Hipple also was appointed to the Board of Directors of KeyCorp in July 2012.
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John D. Grampa
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65
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Senior Vice President Finance and Chief Financial Officer
.
Mr. Grampa was named Senior Vice President Finance and Chief Financial Officer in December 2006. Prior to that, he had served as Vice President Finance and Chief Financial Officer since November 1999 and as Vice President Finance since October 1998. Prior to that, he had served as Vice President, Finance for the Worldwide Materials Business of Avery Dennison Corporation (producer of pressure sensitive materials, office products, labels and other converted products) since March 1994 and held other various positions at Avery Dennison Corporation from 1984.
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Gregory R. Chemnitz
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55
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Vice President, General Counsel
. Mr. Chemnitz joined Materion Corporation in September 2007 as its Vice President, General Counsel. Prior to that, he had served in various roles in the Law Department at Avery Dennison Corporation beginning in 1992, including most recently, as Assistant General Counsel, Americas, where he had responsibility for the legal affairs of Avery Dennison’s business units in North and South America.
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Item 1A.
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RISK FACTORS
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•
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burdens to comply with multiple and potentially conflicting foreign laws and regulations, including export requirements, tariffs and other barriers, environmental health and safety requirements and unexpected changes in any of these factors;
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•
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difficulty in obtaining export licenses from the United States Government;
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•
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political and economic instability and disruptions, including terrorist attacks;
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•
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disadvantages of competing against companies from countries that are not subject to U.S. laws and regulations, including the Foreign Corrupt Practices Act (FCPA);
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•
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potentially adverse tax consequences due to overlapping or differing tax structures; and
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•
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fluctuations in currency exchange rates.
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•
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changes in credit markets that reduce available credit or the ability to renew existing credit facilities on acceptable terms;
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•
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a deterioration of our credit;
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•
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a deterioration in the financial condition of the banks with which we do business;
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•
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extreme volatility in our markets that increases margin or credit requirements; and
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•
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the collateral pledge of substantially all of our assets in connection with our existing indebtedness, which limits our flexibility in raising additional capital.
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Item 1B.
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UNRESOLVED STAFF COMMENTS
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Item 2.
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PROPERTIES
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Location
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Owned or Leased
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Approximate
Number of
Square Feet
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Corporate and Administrative Offices
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Mayfield Heights, Ohio (1)(2)(3)(5)
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Leased
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79,000
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Manufacturing Facilities
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Albuquerque, New Mexico (1)
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Owned/Leased
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13,000/80,200
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Bloomfield, Connecticut (1)
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Leased
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23,400
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Brewster, New York (1)
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Leased
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75,000
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Buellton, California (1)
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Leased
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35,000
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Buffalo, New York (1)
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Owned
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97,000
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Delta, Utah (2)
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Owned
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86,000
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Elmore, Ohio (2)(3)
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Owned/Leased
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681,000/191,000
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Farnborough, England (3)
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Leased
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10,000
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Fremont, California (3)
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Leased
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40,000
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Limerick, Ireland (1)
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Leased
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18,000
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Lincoln, Rhode Island (4)
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Owned/Leased
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130,000/12,000
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Lorain, Ohio (2)
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Owned
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55,000
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Milwaukee, Wisconsin (1)
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Owned/Leased
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99,000/7,300
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Newburyport, Massachusetts (1)
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Owned
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30,000
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Reading, Pennsylvania (2)
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Owned
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123,000
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Santa Clara, California (1)
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Leased
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5,800
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Shanghai, China (1)
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Leased
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101,400
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Singapore (1)
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Leased
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30,000
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Subic Bay, Philippines (1)
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Leased
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5,000
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Suzhou, China (1)
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Leased
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22,400
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Taipei, Taiwan (1)
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Leased
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11,500
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Tucson, Arizona (3)
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Owned
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53,000
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Tyngsboro, Massachusetts (1)
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Leased
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38,000
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Westford, Massachusetts (1)
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Leased
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75,000
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Wheatfield, New York (1)
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Owned
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35,000
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Windsor, Connecticut (1)
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Leased
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34,700
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Service and Distribution Centers
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Elmhurst, Illinois (2)
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Leased
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28,500
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Fukaya, Japan (2)(3)(4)
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Owned
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35,500
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Reading, England (2)(3)
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Leased
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9,700
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Singapore (2)(3)(4)
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Leased
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2,500
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Stuttgart, Germany (2)
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Leased
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24,800
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Tokyo, Japan (2)(3)(4)
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Leased
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7,200
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Warren, Michigan (2)
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Leased
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34,500
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(1)
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Advanced Material Technologies
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(2)
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Performance Alloys
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(3)
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Beryllium and Composites
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(4)
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Technical Materials
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(5)
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All Other
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Item 3.
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LEGAL PROCEEDINGS
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Item 4.
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MINE SAFETY DISCLOSURES
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Item 5.
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MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
|
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Stock Price Range
|
|
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||||||||
Fiscal Quarters
|
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High
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Low
|
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Dividends
|
||||||
2012
|
|
|
|
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|
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||||||
First
|
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$
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32.91
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$
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24.77
|
|
|
$
|
—
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Second
|
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29.37
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|
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20.37
|
|
|
0.075
|
|
|||
Third
|
|
25.57
|
|
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17.59
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|
|
0.075
|
|
|||
Fourth
|
|
25.93
|
|
|
18.84
|
|
|
0.075
|
|
|||
|
|
|
|
|
|
|
||||||
2011
|
|
|
|
|
|
|
||||||
First
|
|
$
|
44.94
|
|
|
$
|
33.99
|
|
|
$
|
—
|
|
Second
|
|
44.00
|
|
|
33.02
|
|
|
—
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|
|||
Third
|
|
42.05
|
|
|
21.11
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|
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—
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|
|||
Fourth
|
|
30.15
|
|
|
19.53
|
|
|
—
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|
|||
|
|
|
|
|
|
|
|
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2007
|
|
2008
|
|
2009
|
|
2010
|
|
2011
|
|
2012
|
Materion Corporation
|
|
$100
|
|
$34
|
|
$50
|
|
$104
|
|
$66
|
|
$70
|
S&P SmallCap 600
|
|
$100
|
|
$69
|
|
$87
|
|
$109
|
|
$110
|
|
$128
|
Russell 2000
|
|
$100
|
|
$66
|
|
$84
|
|
$107
|
|
$102
|
|
$119
|
Item 6.
|
SELECTED FINANCIAL DATA
|
(Thousands except per share data)
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
|
2008
|
||||||||||
For the year
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales
|
|
$
|
1,273,008
|
|
|
$
|
1,526,730
|
|
|
$
|
1,302,314
|
|
|
$
|
715,186
|
|
|
$
|
909,711
|
|
Cost of sales
|
|
1,074,295
|
|
|
1,311,409
|
|
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1,079,666
|
|
|
623,764
|
|
|
757,836
|
|
|||||
Gross margin
|
|
198,783
|
|
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215,321
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|
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222,648
|
|
|
91,422
|
|
|
151,875
|
|
|||||
Operating profit (loss)
|
|
36,776
|
|
|
57,078
|
|
|
73,633
|
|
|
(19,485
|
)
|
|
28,071
|
|
|||||
Interest expense - net
|
|
3,134
|
|
|
2,812
|
|
|
2,665
|
|
|
1,299
|
|
|
1,995
|
|
|||||
Income (loss) before income taxes
|
|
33,642
|
|
|
54,266
|
|
|
70,968
|
|
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(20,784
|
)
|
|
26,076
|
|
|||||
Income taxes (benefit)
|
|
8,978
|
|
|
14,287
|
|
|
24,541
|
|
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(8,429
|
)
|
|
7,719
|
|
|||||
Net income (loss)
|
|
24,664
|
|
|
39,979
|
|
|
46,427
|
|
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(12,355
|
)
|
|
18,357
|
|
|||||
Earnings per share of common stock:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
1.21
|
|
|
1.96
|
|
|
2.29
|
|
|
(0.61
|
)
|
|
0.90
|
|
|||||
Diluted
|
|
1.19
|
|
|
1.93
|
|
|
2.25
|
|
|
(0.61
|
)
|
|
0.89
|
|
|||||
Dividends per share of common stock
|
|
0.225
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Depreciation and amortization
|
|
37,695
|
|
|
44,194
|
|
|
35,932
|
|
|
32,369
|
|
|
34,204
|
|
|||||
Capital expenditures
|
|
34,088
|
|
|
28,187
|
|
|
42,314
|
|
|
44,173
|
|
|
35,515
|
|
|||||
Mine development expenditures
|
|
10,573
|
|
|
560
|
|
|
11,348
|
|
|
808
|
|
|
421
|
|
|||||
Year-end position
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Working capital
|
|
251,922
|
|
|
231,230
|
|
|
208,365
|
|
|
140,482
|
|
|
189,899
|
|
|||||
Ratio of current assets to current liabilities
|
|
2.7 to 1
|
|
|
2.7 to 1
|
|
|
2.4 to 1
|
|
|
2.0 to 1
|
|
|
2.8 to 1
|
|
|||||
Property and equipment:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
At cost
|
|
$
|
779,785
|
|
|
$
|
752,726
|
|
|
$
|
719,953
|
|
|
$
|
665,361
|
|
|
$
|
635,266
|
|
Cost less depreciation, amortization and depletion
|
|
272,542
|
|
|
263,398
|
|
|
265,868
|
|
|
227,766
|
|
|
207,254
|
|
|||||
Total assets
|
|
814,917
|
|
|
772,103
|
|
|
735,410
|
|
|
621,953
|
|
|
581,897
|
|
|||||
Long-term liabilities
|
|
203,335
|
|
|
184,143
|
|
|
157,571
|
|
|
131,630
|
|
|
116,524
|
|
|||||
Long-term debt
|
|
44,880
|
|
|
40,463
|
|
|
38,305
|
|
|
8,305
|
|
|
10,605
|
|
|||||
Shareholders’ equity
|
|
414,995
|
|
|
405,982
|
|
|
384,356
|
|
|
339,859
|
|
|
347,097
|
|
|||||
Weighted-average number of shares of stock outstanding:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
20,418
|
|
|
20,365
|
|
|
20,282
|
|
|
20,191
|
|
|
20,335
|
|
|||||
Diluted
|
|
20,679
|
|
|
20,754
|
|
|
20,590
|
|
|
20,191
|
|
|
20,543
|
|
Item 7.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
(Millions except per share amounts)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Net sales
|
|
$
|
1,273.1
|
|
|
$
|
1,526.7
|
|
|
$
|
1,302.3
|
|
Operating profit
|
|
36.8
|
|
|
57.1
|
|
|
73.6
|
|
|||
Income before income taxes
|
|
33.6
|
|
|
54.3
|
|
|
71.0
|
|
|||
Net income
|
|
24.7
|
|
|
40.0
|
|
|
46.4
|
|
|||
Diluted earnings per share
|
|
1.19
|
|
|
1.93
|
|
|
2.25
|
|
•
|
Our microelectronics packaging business will relocate from Massachusetts to Singapore in order to more effectively service the customer base in Malaysia. The relocation is planned to be completed in the first half of 2013.
|
•
|
The precious metal facility in the Czech Republic was shut down in the fourth quarter 2012 and going forward the existing customer base will be serviced from our facility in Ireland. The Czech operation had limited market penetration and was unprofitable.
|
•
|
We had excess manufacturing capacity in our optical coatings operations, partially due to softer demand for these products for defense applications, and, as a result, we will close a facility in California and relocate strategic assets to other facilities during 2013. We also reduced the headcount at the related facility in China in the second half of 2012.
|
•
|
The Albuquerque, New Mexico operations will be consolidated from four separate buildings into two buildings in 2013 in order to improve work flow and space utilization and reduce overhead costs.
|
(Millions)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Income before income taxes
|
|
$
|
33.6
|
|
|
$
|
54.3
|
|
|
$
|
71.0
|
|
Income tax expense
|
|
9.0
|
|
|
14.3
|
|
|
24.5
|
|
|||
Effective tax rate
|
|
26.7
|
%
|
|
26.3
|
%
|
|
34.6
|
%
|
(Millions)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Net sales
|
|
$
|
847.8
|
|
|
$
|
1,051.8
|
|
|
$
|
879.0
|
|
Operating profit
|
|
16.7
|
|
|
33.5
|
|
|
39.5
|
|
(Millions)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Net sales
|
|
$
|
292.4
|
|
|
$
|
335.3
|
|
|
$
|
293.8
|
|
Operating profit
|
|
24.0
|
|
|
27.2
|
|
|
27.2
|
|
(Millions)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Net sales
|
|
$
|
60.0
|
|
|
$
|
60.6
|
|
|
$
|
61.9
|
|
Operating (loss) profit
|
|
(3.9
|
)
|
|
(0.8
|
)
|
|
10.0
|
|
(Millions)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Net sales
|
|
$
|
72.7
|
|
|
$
|
78.7
|
|
|
$
|
67.5
|
|
Operating profit
|
|
6.6
|
|
|
7.3
|
|
|
5.3
|
|
(Millions)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Asia
|
|
$
|
219.8
|
|
|
$
|
203.9
|
|
|
$
|
216.3
|
|
Europe
|
|
137.6
|
|
|
147.6
|
|
|
127.5
|
|
|||
Rest of world
|
|
33.7
|
|
|
31.5
|
|
|
25.3
|
|
|||
Total
|
|
$
|
391.1
|
|
|
$
|
383.0
|
|
|
$
|
369.1
|
|
Percent of total sales
|
|
31
|
%
|
|
25
|
%
|
|
28
|
%
|
(Millions)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Capital expenditures
|
|
$
|
34.1
|
|
|
$
|
28.2
|
|
|
$
|
42.4
|
|
Mine development
|
|
10.6
|
|
|
0.6
|
|
|
11.3
|
|
|||
Subtotal
|
|
44.7
|
|
|
28.8
|
|
|
53.7
|
|
|||
Reimbursement for spending under government contract
|
|
1.0
|
|
|
5.4
|
|
|
21.9
|
|
|||
Net spending
|
|
$
|
43.7
|
|
|
$
|
23.4
|
|
|
$
|
31.8
|
|
(Millions)
|
|
Year
|
|
Cost
|
|
Acquired
Goodwill
|
||||
Aerospace Metal Composites Limited
|
|
2012
|
|
$
|
3.3
|
|
|
$
|
1.9
|
|
EIS Optics Limited
|
|
2011
|
|
24.5
|
|
|
13.9
|
|
||
Academy Corporation
|
|
2010
|
|
21.0
|
|
|
5.4
|
|
(Millions)
|
|
2013
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
There-
after
|
|
Total
|
||||||||||||||
Long-term debt
|
|
$
|
0.6
|
|
|
$
|
0.6
|
|
|
$
|
0.7
|
|
|
$
|
39.0
|
|
|
$
|
0.7
|
|
|
$
|
3.9
|
|
|
$
|
45.5
|
|
Non-cancelable lease payments
|
|
6.7
|
|
|
5.0
|
|
|
4.5
|
|
|
4.1
|
|
|
3.1
|
|
|
15.0
|
|
|
38.4
|
|
|||||||
Capital lease payments
|
|
1.1
|
|
|
1.1
|
|
|
1.1
|
|
|
1.0
|
|
|
1.0
|
|
|
5.8
|
|
|
11.1
|
|
|||||||
Pension plan contribution
|
|
13.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13.0
|
|
|||||||
Purchase commitments
|
|
3.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3.2
|
|
|||||||
Total
|
|
$
|
24.6
|
|
|
$
|
6.7
|
|
|
$
|
6.3
|
|
|
$
|
44.1
|
|
|
$
|
4.8
|
|
|
$
|
24.7
|
|
|
$
|
111.2
|
|
|
|
December 31,
|
||||||||||
(Dollars in millions)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Total outstanding debt
|
|
$
|
94.3
|
|
|
$
|
81.4
|
|
|
$
|
86.1
|
|
Cash
|
|
16.1
|
|
|
12.3
|
|
|
16.1
|
|
|||
Debt net of cash
|
|
$
|
78.2
|
|
|
$
|
69.1
|
|
|
$
|
70.0
|
|
Available borrowing capacity
|
|
$
|
181.4
|
|
|
$
|
274.9
|
|
|
$
|
173.0
|
|
Debt-to-debt-plus-equity ratio
|
|
19
|
%
|
|
17
|
%
|
|
18
|
%
|
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
|
2008
|
|||||
Proven bertrandite ore reserves at year-end (thousands of dry tons)
|
|
6,250
|
|
|
6,341
|
|
|
6,404
|
|
|
6,425
|
|
|
6,454
|
|
Grade % beryllium
|
|
0.264
|
%
|
|
0.265
|
%
|
|
0.266
|
%
|
|
0.266
|
%
|
|
0.266
|
%
|
Probable bertrandite ore reserves at year-end (thousands of dry tons)
|
|
3,519
|
|
|
3,519
|
|
|
3,519
|
|
|
3,519
|
|
|
3,519
|
|
Grade % beryllium
|
|
0.232
|
%
|
|
0.232
|
%
|
|
0.232
|
%
|
|
0.232
|
%
|
|
0.232
|
%
|
Bertrandite ore processed (thousands of dry tons, diluted)
|
|
71
|
|
|
70
|
|
|
56
|
|
|
39
|
|
|
64
|
|
Grade % beryllium, diluted
|
|
0.345
|
%
|
|
0.381
|
%
|
|
0.336
|
%
|
|
0.330
|
%
|
|
0.321
|
%
|
Item 7A.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
Item 8.
|
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|
|
|
Financial Statements
|
Page
|
Management’s Report on Internal Control over Financial Reporting
|
48
|
Reports of Independent Registered Public Accounting Firm
|
49
|
Consolidated Statements of Income for the Years Ended December 31, 2012, 2011 and 2010
|
51
|
Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2012, 2011 and 2010
|
52
|
Consolidated Statements of Cash Flows for the Years Ended December 31, 2012, 2011 and 2010
|
53
|
Consolidated Balance Sheets as of December 31, 2012 and 2011
|
54
|
Consolidated Statements of Shareholders’ Equity for the Years Ended December 31, 2012, 2011 and 2010
|
55
|
Notes to Consolidated Financial Statements
|
56
|
|
|
|
/
S
/ R
ICHARD
J. H
IPPLE
|
|
Richard J. Hipple
|
|
Chairman, President and Chief Executive Officer
|
|
|
|
/
S
/ J
OHN
D. G
RAMPA
|
|
John D. Grampa
|
|
Senior Vice President Finance and
|
|
Chief Financial Officer
|
(Thousands except per share amounts)
|
2012
|
|
2011
|
|
2010
|
||||||
Net sales
|
$
|
1,273,078
|
|
|
$
|
1,526,730
|
|
|
$
|
1,302,314
|
|
Cost of sales
|
1,074,295
|
|
|
1,311,409
|
|
|
1,079,666
|
|
|||
Gross margin
|
198,783
|
|
|
215,321
|
|
|
222,648
|
|
|||
Selling, general and administrative expense
|
133,893
|
|
|
131,388
|
|
|
126,477
|
|
|||
Research and development expense
|
12,505
|
|
|
11,081
|
|
|
7,113
|
|
|||
Derivative ineffectiveness
|
—
|
|
|
—
|
|
|
598
|
|
|||
Other — net
|
15,609
|
|
|
15,774
|
|
|
14,827
|
|
|||
Operating profit
|
36,776
|
|
|
57,078
|
|
|
73,633
|
|
|||
Interest expense — net
|
3,134
|
|
|
2,812
|
|
|
2,665
|
|
|||
Income before income taxes
|
33,642
|
|
|
54,266
|
|
|
70,968
|
|
|||
Income tax expense
|
8,978
|
|
|
14,287
|
|
|
24,541
|
|
|||
Net income
|
$
|
24,664
|
|
|
$
|
39,979
|
|
|
$
|
46,427
|
|
Basic earnings per share:
|
|
|
|
|
|
||||||
Net income per share of common stock
|
$
|
1.21
|
|
|
$
|
1.96
|
|
|
$
|
2.29
|
|
Diluted earnings per share:
|
|
|
|
|
|
||||||
Net income per share of common stock
|
$
|
1.19
|
|
|
$
|
1.93
|
|
|
$
|
2.25
|
|
|
|
|
|
|
|
||||||
Cash dividends per share
|
$
|
0.225
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
||||||
Weighted-average number of shares of common stock outstanding
|
|
|
|
|
|
||||||
Basic
|
20,418
|
|
|
20,365
|
|
|
20,282
|
|
|||
Diluted
|
20,679
|
|
|
20,754
|
|
|
20,590
|
|
(Thousands)
|
2012
|
|
2011
|
|
2010
|
||||||
Net income
|
$
|
24,664
|
|
|
$
|
39,979
|
|
|
$
|
46,427
|
|
Other comprehensive income:
|
|
|
|
|
|
||||||
Foreign currency translation adjustment
|
(870
|
)
|
|
958
|
|
|
1,665
|
|
|||
Derivative and hedging activity, net of tax benefit (expense) of $385, ($1,047) and $581
|
(715
|
)
|
|
1,946
|
|
|
(1,078
|
)
|
|||
Pension and post employment benefit adjustment, net of tax of $7,676, $12,292 and $3,119
|
(14,629
|
)
|
|
(23,503
|
)
|
|
(5,519
|
)
|
|||
Net change in accumulated other comprehensive income
|
(16,214
|
)
|
|
(20,599
|
)
|
|
(4,932
|
)
|
|||
Comprehensive income
|
$
|
8,450
|
|
|
$
|
19,380
|
|
|
$
|
41,495
|
|
(Thousands)
|
2012
|
|
2011
|
|
2010
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net income
|
$
|
24,664
|
|
|
$
|
39,979
|
|
|
$
|
46,427
|
|
Adjustments to reconcile net income to net cash provided from operating activities:
|
|
|
|
|
|
||||||
Depreciation, depletion and amortization
|
37,046
|
|
|
43,635
|
|
|
35,394
|
|
|||
Amortization of deferred financing costs in interest expense
|
649
|
|
|
559
|
|
|
538
|
|
|||
Stock-based compensation expense
|
5,889
|
|
|
5,000
|
|
|
4,100
|
|
|||
Derivative financial instruments ineffectiveness
|
—
|
|
|
—
|
|
|
598
|
|
|||
Deferred tax (benefit) expense
|
(2,462
|
)
|
|
(1,668
|
)
|
|
13,623
|
|
|||
Changes in assets and liabilities net of acquired assets and liabilities:
|
|
|
|
|
|
||||||
Decrease (increase) in accounts receivable
|
(8,913
|
)
|
|
26,818
|
|
|
(50,386
|
)
|
|||
Decrease (increase) in other receivables
|
4,197
|
|
|
(630
|
)
|
|
7,084
|
|
|||
Decrease (increase) in inventory
|
(18,880
|
)
|
|
(30,016
|
)
|
|
(23,112
|
)
|
|||
Decrease (increase) in prepaid and other current assets
|
483
|
|
|
(7,571
|
)
|
|
(3,566
|
)
|
|||
Increase (decrease) in accounts payable and accrued expenses
|
1,472
|
|
|
(2,580
|
)
|
|
7,002
|
|
|||
Increase (decrease) in unearned revenue
|
(1,491
|
)
|
|
661
|
|
|
1,938
|
|
|||
Increase (decrease) in interest and taxes payable
|
(2,324
|
)
|
|
(5,891
|
)
|
|
2,048
|
|
|||
Increase (decrease) in long-term liabilities
|
(5,053
|
)
|
|
(15,993
|
)
|
|
(8,736
|
)
|
|||
Other — net
|
3,343
|
|
|
4,503
|
|
|
(1,911
|
)
|
|||
Net cash provided from operating activities
|
38,620
|
|
|
56,806
|
|
|
31,041
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Payments for purchase of property, plant and equipment
|
(34,088
|
)
|
|
(28,187
|
)
|
|
(42,314
|
)
|
|||
Payments for mine development
|
(10,573
|
)
|
|
(560
|
)
|
|
(11,348
|
)
|
|||
Reimbursement for capital spending under government contract
|
991
|
|
|
5,386
|
|
|
21,944
|
|
|||
Payments for purchase of business less cash received
|
(3,894
|
)
|
|
(22,448
|
)
|
|
(20,605
|
)
|
|||
Proceeds from transfer of acquired inventory to consignment line
|
—
|
|
|
—
|
|
|
5,667
|
|
|||
Proceeds from sale of property, plant and equipment
|
—
|
|
|
54
|
|
|
77
|
|
|||
Other investments — net
|
4,201
|
|
|
(4,274
|
)
|
|
60
|
|
|||
Net cash (used in) investing activities
|
(43,363
|
)
|
|
(50,029
|
)
|
|
(46,519
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Issuance (repayment) of short-term debt
|
8,594
|
|
|
(6,950
|
)
|
|
(8,406
|
)
|
|||
Proceeds from issuance of long-term debt
|
32,403
|
|
|
118,582
|
|
|
80,000
|
|
|||
Repayment of long-term debt
|
(27,986
|
)
|
|
(116,425
|
)
|
|
(50,000
|
)
|
|||
Principal payments under capital lease obligations
|
(749
|
)
|
|
(812
|
)
|
|
(779
|
)
|
|||
Cash dividends paid
|
(4,615
|
)
|
|
—
|
|
|
—
|
|
|||
Deferred financing costs
|
—
|
|
|
(2,637
|
)
|
|
(220
|
)
|
|||
Repurchase of common stock
|
(119
|
)
|
|
(3,776
|
)
|
|
(3,527
|
)
|
|||
Issuance of common stock under stock option plans
|
158
|
|
|
735
|
|
|
2,631
|
|
|||
Tax benefit from stock compensation realization
|
817
|
|
|
658
|
|
|
121
|
|
|||
Net cash provided from (used in) financing activities
|
8,503
|
|
|
(10,625
|
)
|
|
19,820
|
|
|||
Effects of exchange rate changes on cash and cash equivalents
|
41
|
|
|
(1
|
)
|
|
(491
|
)
|
|||
Net change in cash and cash equivalents
|
3,801
|
|
|
(3,849
|
)
|
|
3,851
|
|
|||
Cash and cash equivalents at beginning of year
|
12,255
|
|
|
16,104
|
|
|
12,253
|
|
|||
Cash and cash equivalents at end of year
|
$
|
16,056
|
|
|
$
|
12,255
|
|
|
$
|
16,104
|
|
(Thousands)
|
2012
|
|
2011
|
||||
Assets
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
16,056
|
|
|
$
|
12,255
|
|
Accounts receivable (net of allowance of $1,403 for 2012 and $1,490 for 2011)
|
126,482
|
|
|
117,761
|
|
||
Other receivables
|
405
|
|
|
4,602
|
|
||
Inventories
|
206,125
|
|
|
187,176
|
|
||
Prepaid expenses
|
41,685
|
|
|
39,739
|
|
||
Deferred income taxes
|
10,236
|
|
|
9,368
|
|
||
Total current assets
|
400,989
|
|
|
370,901
|
|
||
Related-party notes receivable
|
51
|
|
|
73
|
|
||
Long-term deferred income taxes
|
19,946
|
|
|
11,627
|
|
||
Property, plant and equipment
|
779,785
|
|
|
752,726
|
|
||
Less allowances for depreciation, amortization and depletion
|
(507,243
|
)
|
|
(489,328
|
)
|
||
Property, plant and equipment — net
|
272,542
|
|
|
263,398
|
|
||
Intangible assets
|
28,869
|
|
|
34,995
|
|
||
Other assets
|
3,767
|
|
|
7,073
|
|
||
Goodwill
|
88,753
|
|
|
84,036
|
|
||
Total Assets
|
$
|
814,917
|
|
|
$
|
772,103
|
|
|
|
|
|
||||
Liabilities and Shareholders’ Equity
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Short-term debt
|
$
|
49,432
|
|
|
$
|
40,944
|
|
Accounts payable
|
42,281
|
|
|
39,385
|
|
||
Salaries and wages
|
27,768
|
|
|
29,441
|
|
||
Taxes other than income taxes
|
1,055
|
|
|
975
|
|
||
Other liabilities and accrued items
|
26,988
|
|
|
25,893
|
|
||
Unearned revenue
|
1,543
|
|
|
3,033
|
|
||
Total current liabilities
|
149,067
|
|
|
139,671
|
|
||
Other long-term liabilities
|
16,173
|
|
|
16,488
|
|
||
Retirement and post-employment benefits
|
125,978
|
|
|
105,115
|
|
||
Unearned income
|
61,184
|
|
|
62,540
|
|
||
Long-term income taxes
|
1,510
|
|
|
1,793
|
|
||
Deferred income taxes
|
1,130
|
|
|
51
|
|
||
Long-term debt
|
44,880
|
|
|
40,463
|
|
||
Shareholders’ equity
|
|
|
|
||||
Serial preferred stock (no par value; 5,000 authorized shares, none issued)
|
—
|
|
|
—
|
|
||
Common stock (no par value; 60,000 authorized shares, issued shares of 27,050 for 2012 and 27,024 for 2011)
|
191,169
|
|
|
185,913
|
|
||
Retained earnings
|
428,394
|
|
|
408,380
|
|
||
Common stock in treasury (6,607 shares for 2012 and 6,716 shares for 2011)
|
(118,298
|
)
|
|
(118,279
|
)
|
||
Other comprehensive income (loss)
|
(88,429
|
)
|
|
(72,215
|
)
|
||
Other equity transactions
|
2,159
|
|
|
2,183
|
|
||
Total shareholders’ equity
|
414,995
|
|
|
405,982
|
|
||
Total Liabilities and Shareholders’ Equity
|
$
|
814,917
|
|
|
$
|
772,103
|
|
(Thousands)
|
Common
Stock
|
|
Retained
Earnings
|
|
Common
Stock In
Treasury
|
|
Other
Comprehensive
Income (Loss)
|
|
Other
Equity
Transactions
|
|
Total
|
||||||||||||
Balance at January 1, 2010
|
$
|
173,776
|
|
|
$
|
321,974
|
|
|
$
|
(111,370
|
)
|
|
$
|
(46,684
|
)
|
|
$
|
2,163
|
|
|
$
|
339,859
|
|
Net income
|
—
|
|
|
46,427
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
46,427
|
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,932
|
)
|
|
—
|
|
|
(4,932
|
)
|
||||||
Proceeds from exercise of 154 shares under option plans
|
2,631
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,631
|
|
||||||
Income tax benefit from stock compensation realization
|
120
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
120
|
|
||||||
Repurchase of 150 shares
|
—
|
|
|
—
|
|
|
(3,527
|
)
|
|
—
|
|
|
—
|
|
|
(3,527
|
)
|
||||||
Stock-based compensation expense
|
4,100
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,100
|
|
||||||
Shares withheld for employee taxes on equity awards
|
(481
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(481
|
)
|
||||||
Directors' deferred compensation
|
—
|
|
|
—
|
|
|
(192
|
)
|
|
—
|
|
|
337
|
|
|
145
|
|
||||||
Other equity transactions
|
15
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
14
|
|
||||||
Balance at December 31, 2010
|
180,161
|
|
|
368,401
|
|
|
(115,090
|
)
|
|
(51,616
|
)
|
|
2,500
|
|
|
384,356
|
|
||||||
Net income
|
—
|
|
|
39,979
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
39,979
|
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
(20,599
|
)
|
|
—
|
|
|
(20,599
|
)
|
||||||
Proceeds from exercise of 53 shares under option plans
|
735
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
735
|
|
||||||
Income tax benefit from stock compensation realization
|
658
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
658
|
|
||||||
Repurchase of 132 shares
|
—
|
|
|
—
|
|
|
(3,776
|
)
|
|
—
|
|
|
—
|
|
|
(3,776
|
)
|
||||||
Stock-based compensation expense
|
5,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,000
|
|
||||||
Shares withheld for employee taxes on equity awards
|
(641
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(641
|
)
|
||||||
Directors' deferred compensation
|
—
|
|
|
—
|
|
|
587
|
|
|
—
|
|
|
(317
|
)
|
|
270
|
|
||||||
Balance at December 31, 2011
|
185,913
|
|
|
408,380
|
|
|
(118,279
|
)
|
|
(72,215
|
)
|
|
2,183
|
|
|
405,982
|
|
||||||
Net income
|
—
|
|
|
24,664
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24,664
|
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
(16,214
|
)
|
|
—
|
|
|
(16,214
|
)
|
||||||
Cash dividends declared
|
—
|
|
|
(4,650
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,650
|
)
|
||||||
Proceeds from exercise of 16 shares under option plans
|
158
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
158
|
|
||||||
Income tax benefit from stock compensation realization
|
817
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
817
|
|
||||||
Repurchase of 6 shares
|
—
|
|
|
—
|
|
|
(119
|
)
|
|
—
|
|
|
—
|
|
|
(119
|
)
|
||||||
Stock-based compensation expense
|
5,889
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,889
|
|
||||||
Shares withheld for employee taxes on equity awards
|
(1,608
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,608
|
)
|
||||||
Directors’ deferred compensation
|
—
|
|
|
—
|
|
|
100
|
|
|
—
|
|
|
(24
|
)
|
|
76
|
|
||||||
Balance at December 31, 2012
|
$
|
191,169
|
|
|
$
|
428,394
|
|
|
$
|
(118,298
|
)
|
|
$
|
(88,429
|
)
|
|
$
|
2,159
|
|
|
$
|
414,995
|
|
|
|
Years
|
Land improvements
|
|
5 to 25
|
Buildings
|
|
10 to 40
|
Leasehold improvements
|
|
Life of lease
|
Machinery and equipment
|
|
3 to 15
|
Furniture and fixtures
|
|
4 to 15
|
Automobiles and trucks
|
|
2 to 8
|
Research equipment
|
|
6 to 12
|
Computer hardware
|
|
3 to 10
|
Computer software
|
|
3 to 10
|
|
|
December 31,
|
||||||
(Thousands)
|
|
2012
|
|
2011
|
||||
Principally average cost:
|
|
|
|
|
||||
Raw materials and supplies
|
|
$
|
42,751
|
|
|
$
|
42,969
|
|
Work in process
|
|
203,179
|
|
|
179,445
|
|
||
Finished goods
|
|
51,094
|
|
|
57,645
|
|
||
Gross inventories
|
|
297,024
|
|
|
280,059
|
|
||
Excess of average cost over LIFO inventory value
|
|
90,899
|
|
|
92,883
|
|
||
Net inventories
|
|
$
|
206,125
|
|
|
$
|
187,176
|
|
|
|
December 31,
|
||||||
(Thousands)
|
|
2012
|
|
2011
|
||||
Land
|
|
$
|
8,797
|
|
|
$
|
9,123
|
|
Buildings
|
|
127,691
|
|
|
114,090
|
|
||
Machinery and equipment
|
|
570,001
|
|
|
485,593
|
|
||
Software
|
|
31,640
|
|
|
29,277
|
|
||
Construction in progress
|
|
15,389
|
|
|
86,149
|
|
||
Allowances for depreciation
|
|
(503,560
|
)
|
|
(476,443
|
)
|
||
Subtotal
|
|
249,956
|
|
|
247,789
|
|
||
Capital leases
|
|
10,912
|
|
|
10,898
|
|
||
Allowances for amortization
|
|
(1,440
|
)
|
|
(837
|
)
|
||
Subtotal
|
|
9,472
|
|
|
10,061
|
|
||
Mineral resources
|
|
4,979
|
|
|
5,029
|
|
||
Mine development
|
|
10,377
|
|
|
12,567
|
|
||
Allowances for amortization and depletion
|
|
(2,243
|
)
|
|
(12,048
|
)
|
||
Subtotal
|
|
13,113
|
|
|
5,548
|
|
||
Property, plant and equipment — net
|
|
$
|
272,542
|
|
|
$
|
263,398
|
|
(Dollars in thousands)
|
|
Amount
|
|
Weighted-average
Amortization Period
|
||
Customer relationships
|
|
$
|
257
|
|
|
5.0 Years
|
Trade Name
|
|
62
|
|
|
5.0 Years
|
|
Technology
|
|
212
|
|
|
5.0 Years
|
|
Total assets subject to amortization
|
|
$
|
531
|
|
|
5.0 Years
|
|
|
|
|
|
||
Goodwill
|
|
$
|
4,717
|
|
|
Not Applicable
|
(Thousands)
|
|
2012
|
|
2011
|
||||
Deferred financing costs
|
|
|
|
|
||||
Cost
|
|
$
|
6,427
|
|
|
$
|
6,427
|
|
Accumulated amortization
|
|
(4,048
|
)
|
|
(3,399
|
)
|
||
Net book value
|
|
2,379
|
|
|
3,028
|
|
||
Customer relationships
|
|
|
|
|
||||
Cost
|
|
38,427
|
|
|
38,170
|
|
||
Accumulated amortization
|
|
(18,703
|
)
|
|
(14,684
|
)
|
||
Net book value
|
|
19,724
|
|
|
23,486
|
|
||
Technology
|
|
|
|
|
||||
Cost
|
|
12,092
|
|
|
11,880
|
|
||
Accumulated amortization
|
|
(6,538
|
)
|
|
(5,074
|
)
|
||
Net book value
|
|
5,554
|
|
|
6,806
|
|
||
License
|
|
|
|
|
||||
Cost
|
|
2,480
|
|
|
2,480
|
|
||
Accumulated amortization
|
|
(1,340
|
)
|
|
(850
|
)
|
||
Net book value
|
|
1,140
|
|
|
1,630
|
|
||
Non-compete contracts
|
|
|
|
|
||||
Cost
|
|
550
|
|
|
550
|
|
||
Accumulated amortization
|
|
(530
|
)
|
|
(505
|
)
|
||
Net book value
|
|
20
|
|
|
45
|
|
||
Trade Name
|
|
|
|
|
||||
Cost
|
|
62
|
|
|
—
|
|
||
Accumulated amortization
|
|
(10
|
)
|
|
—
|
|
||
Net book value
|
|
52
|
|
|
—
|
|
||
Total
|
|
|
|
|
||||
Cost
|
|
$
|
60,038
|
|
|
$
|
59,507
|
|
Accumulated amortization
|
|
(31,169
|
)
|
|
(24,512
|
)
|
||
Net book value
|
|
$
|
28,869
|
|
|
$
|
34,995
|
|
Aggregate amortization expense
|
|
$
|
6,657
|
|
|
$
|
6,703
|
|
(Thousands)
|
|
2012
|
|
2011
|
||||
Balance at the beginning of the year
|
|
$
|
84,036
|
|
|
$
|
72,936
|
|
Current year additions
|
|
4,717
|
|
|
11,100
|
|
||
Balance at the end of the year
|
|
$
|
88,753
|
|
|
$
|
84,036
|
|
|
|
December 31,
|
||||||
(Thousands)
|
|
2012
|
|
2011
|
||||
Revolving credit agreement
|
|
$
|
30,000
|
|
|
$
|
25,000
|
|
Fixed rate industrial development revenue bonds payable in annual installments through 2021
|
|
7,158
|
|
|
7,705
|
|
||
Variable rate industrial development revenue bonds payable in 2016
|
|
8,305
|
|
|
8,305
|
|
||
Total outstanding
|
|
45,463
|
|
|
41,010
|
|
||
Current portion of long-term debt
|
|
(583
|
)
|
|
(547
|
)
|
||
Total
|
|
$
|
44,880
|
|
|
$
|
40,463
|
|
2013
|
$
|
583
|
|
2014
|
613
|
|
|
2015
|
653
|
|
|
2016
|
38,998
|
|
|
2017
|
733
|
|
|
Thereafter
|
3,883
|
|
|
|
|
||
Total
|
$
|
45,463
|
|
|
|
|
|
December 31, 2012
|
|
December 31, 2011
|
||||||||||||||||||||
(Thousands)
|
|
Total
|
|
Outstanding
|
|
Available
|
|
Total
|
|
Outstanding
|
|
Available
|
||||||||||||
Domestic
|
|
$
|
256,799
|
|
|
$
|
8,000
|
|
|
$
|
248,799
|
|
|
$
|
262,724
|
|
|
$
|
3,200
|
|
|
$
|
259,524
|
|
Foreign
|
|
15,266
|
|
|
1,415
|
|
|
13,851
|
|
|
16,149
|
|
|
770
|
|
|
15,379
|
|
||||||
Precious metal
|
|
39,435
|
|
|
39,435
|
|
|
—
|
|
|
36,427
|
|
|
36,427
|
|
|
—
|
|
||||||
Total
|
|
$
|
311,500
|
|
|
$
|
48,850
|
|
|
$
|
262,650
|
|
|
$
|
315,300
|
|
|
$
|
40,397
|
|
|
$
|
274,903
|
|
|
|
Capital
|
|
Operating
|
||||
(Thousands)
|
|
Leases
|
|
Leases
|
||||
2013
|
|
$
|
1,102
|
|
|
$
|
6,721
|
|
2014
|
|
1,069
|
|
|
4,982
|
|
||
2015
|
|
1,068
|
|
|
4,472
|
|
||
2016
|
|
1,066
|
|
|
4,152
|
|
||
2017
|
|
1,064
|
|
|
3,063
|
|
||
2018 and thereafter
|
|
5,766
|
|
|
14,992
|
|
||
Total minimum lease payments
|
|
11,135
|
|
|
$
|
38,382
|
|
|
Amounts representing interest
|
|
2,593
|
|
|
|
|||
Present value of net minimum lease payments
|
|
$
|
8,542
|
|
|
|
|
|
|
|
Fair Value Measurements
|
||||||||||||
(Thousands)
|
|
Total
|
|
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
|
|
Significant
Observable
Inputs
(Level 2)
|
|
Other
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
Financial Assets
|
|
|
|
|
|
|
|
|
||||||||
Directors’ deferred compensation investments
|
|
$
|
1,742
|
|
|
$
|
1,742
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Precious metal forward contracts
|
|
197
|
|
|
—
|
|
|
197
|
|
|
—
|
|
||||
Foreign currency forward contracts
|
|
650
|
|
|
—
|
|
|
650
|
|
|
—
|
|
||||
Total
|
|
$
|
2,589
|
|
|
$
|
1,742
|
|
|
$
|
847
|
|
|
$
|
—
|
|
Financial Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Directors’ deferred compensation liability
|
|
$
|
1,742
|
|
|
$
|
1,742
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Precious metal swaps
|
|
100
|
|
|
—
|
|
|
100
|
|
|
—
|
|
||||
Foreign currency forward contracts
|
|
397
|
|
|
—
|
|
|
397
|
|
|
—
|
|
||||
Total
|
|
$
|
2,239
|
|
|
$
|
1,742
|
|
|
$
|
497
|
|
|
$
|
—
|
|
|
|
December 31, 2012
|
|
December 31, 2011
|
||||||||||||
(Thousands)
|
|
Notional
Amount
|
|
Fair
Value
|
|
Notional
Amount
|
|
Fair
Value
|
||||||||
Asset (liability)
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency forward contracts
|
|
|
|
|
|
|
|
|
||||||||
Yen
|
|
$
|
8,024
|
|
|
$
|
650
|
|
|
$
|
12,096
|
|
|
$
|
(480
|
)
|
Euro
|
|
21,047
|
|
|
(397
|
)
|
|
26,466
|
|
|
1,879
|
|
||||
Total
|
|
$
|
29,071
|
|
|
$
|
253
|
|
|
$
|
38,562
|
|
|
$
|
1,399
|
|
Precious metal contracts
|
|
|
|
|
|
|
|
|
||||||||
Forward contracts
|
|
$
|
14,623
|
|
|
$
|
197
|
|
|
$
|
8,795
|
|
|
$
|
249
|
|
Swaps
|
|
11,673
|
|
|
(100
|
)
|
|
6,964
|
|
|
(198
|
)
|
||||
Total
|
|
$
|
26,296
|
|
|
$
|
97
|
|
|
$
|
15,759
|
|
|
$
|
51
|
|
|
|
December 31,
|
||||||
(Thousands)
|
|
2012
|
|
2011
|
||||
Asset (liability)
|
|
|
|
|
||||
Prepaid expenses
|
|
$
|
847
|
|
|
$
|
2,128
|
|
Other liabilities and accrued items
|
|
(497
|
)
|
|
(678
|
)
|
||
Total
|
|
$
|
350
|
|
|
$
|
1,450
|
|
|
|
Effective Portion of Hedge
|
|
Ineffective Portion of Hedge
|
||||||||||||
|
|
Recognized
in OCI at
End of Period
|
|
Reclassified from OCI
into Income During Period
|
|
Recognized in Income on
Derivative During Period
|
||||||||||
(Thousands)
|
|
Location
|
|
Amount
|
|
Location
|
|
Amount
|
||||||||
Gain (loss)
|
|
|
|
|
|
|
|
|
|
|
||||||
2012
|
|
|
|
|
|
|
|
|
|
|
||||||
Foreign currency contracts
|
|
$
|
253
|
|
|
Other-net
|
|
$
|
1,839
|
|
|
Other-net
|
|
$
|
—
|
|
Precious metal contracts
|
|
97
|
|
|
Cost of sales
|
|
(598
|
)
|
|
Cost of sales
|
|
—
|
|
|||
Total
|
|
$
|
350
|
|
|
|
|
$
|
1,241
|
|
|
|
|
$
|
—
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
||||||
Foreign currency contracts
|
|
$
|
1,399
|
|
|
Other-net
|
|
$
|
(2,809
|
)
|
|
Other-net
|
|
$
|
—
|
|
Precious metal contracts
|
|
51
|
|
|
Cost of Sales
|
|
—
|
|
|
Cost of Sales
|
|
—
|
|
|||
Total
|
|
$
|
1,450
|
|
|
|
|
$
|
(2,809
|
)
|
|
|
|
$
|
—
|
|
|
|
Pension Benefits
|
|
Other Benefits
|
||||||||||||
(Thousands)
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Change in benefit obligation
|
|
|
|
|
|
|
|
|
||||||||
Benefit obligation at beginning of year
|
|
$
|
210,996
|
|
|
$
|
180,673
|
|
|
$
|
33,209
|
|
|
$
|
32,374
|
|
Service cost
|
|
7,915
|
|
|
6,955
|
|
|
285
|
|
|
284
|
|
||||
Interest cost
|
|
9,912
|
|
|
9,786
|
|
|
1,440
|
|
|
1,596
|
|
||||
Plan amendments
|
|
117
|
|
|
430
|
|
|
—
|
|
|
—
|
|
||||
Actuarial loss
|
|
32,595
|
|
|
21,280
|
|
|
1,493
|
|
|
1,419
|
|
||||
Benefit payments from fund
|
|
(7,523
|
)
|
|
(7,512
|
)
|
|
—
|
|
|
—
|
|
||||
Benefit payments directly by Company
|
|
(129
|
)
|
|
(127
|
)
|
|
(2,432
|
)
|
|
(2,735
|
)
|
||||
Expenses paid from assets
|
|
(293
|
)
|
|
(479
|
)
|
|
—
|
|
|
—
|
|
||||
Medicare Part D subsidy
|
|
—
|
|
|
—
|
|
|
299
|
|
|
271
|
|
||||
Foreign currency exchange rate changes
|
|
249
|
|
|
(10
|
)
|
|
—
|
|
|
—
|
|
||||
Benefit obligation at end of year
|
|
253,839
|
|
|
210,996
|
|
|
34,294
|
|
|
33,209
|
|
||||
Change in plan assets
|
|
|
|
|
|
|
|
|
||||||||
Fair value of plan assets at beginning of year
|
|
140,344
|
|
|
131,761
|
|
|
—
|
|
|
—
|
|
||||
Actual return on plan assets
|
|
18,534
|
|
|
(5,215
|
)
|
|
—
|
|
|
—
|
|
||||
Employer contributions
|
|
12,218
|
|
|
21,706
|
|
|
—
|
|
|
—
|
|
||||
Benefit payments from fund
|
|
(7,523
|
)
|
|
(7,512
|
)
|
|
—
|
|
|
—
|
|
||||
Expenses paid from assets
|
|
(293
|
)
|
|
(479
|
)
|
|
—
|
|
|
—
|
|
||||
Foreign currency exchange rate changes
|
|
156
|
|
|
83
|
|
|
—
|
|
|
—
|
|
||||
Fair value of plan assets at end of year
|
|
163,436
|
|
|
140,344
|
|
|
—
|
|
|
—
|
|
||||
Funded status at end of year
|
|
$
|
(90,403
|
)
|
|
$
|
(70,652
|
)
|
|
$
|
(34,294
|
)
|
|
$
|
(33,209
|
)
|
Amounts recognized in the Consolidated
Balance Sheets consist of:
|
|
|
|
|
|
|
|
|
||||||||
Other assets
|
|
$
|
1,112
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Other liabilities and accrued items
|
|
(475
|
)
|
|
—
|
|
|
(2,663
|
)
|
|
(2,788
|
)
|
||||
Retirement and post-employment benefits
|
|
(91,040
|
)
|
|
(70,652
|
)
|
|
(31,631
|
)
|
|
(30,421
|
)
|
||||
|
|
$
|
(90,403
|
)
|
|
$
|
(70,652
|
)
|
|
$
|
(34,294
|
)
|
|
$
|
(33,209
|
)
|
Amounts recognized in other comprehensive income (before tax) consist of:
|
|
|
|
|
|
|
|
|
||||||||
Net actuarial loss
|
|
$
|
127,027
|
|
|
$
|
106,583
|
|
|
$
|
2,472
|
|
|
$
|
978
|
|
Net prior service (credit) cost
|
|
(2,075
|
)
|
|
(2,527
|
)
|
|
115
|
|
|
202
|
|
||||
|
|
$
|
124,952
|
|
|
$
|
104,056
|
|
|
$
|
2,587
|
|
|
$
|
1,180
|
|
Amortizations expected to be recognized during next fiscal year (before tax):
|
|
|
|
|
|
|
|
|
||||||||
Amortization of net loss
|
|
$
|
7,731
|
|
|
$
|
5,605
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Amortization of prior service credit
|
|
(341
|
)
|
|
(335
|
)
|
|
115
|
|
|
87
|
|
||||
|
|
$
|
7,390
|
|
|
$
|
5,270
|
|
|
$
|
115
|
|
|
$
|
87
|
|
Additional information
|
|
|
|
|
|
|
|
|
||||||||
Accumulated benefit obligation for all defined benefit pension plans
|
|
$
|
242,854
|
|
|
$
|
204,359
|
|
|
—
|
|
|
—
|
|
||
For defined benefit pension plans with benefit obligations in excess of plan assets:
|
|
|
|
|
|
|
|
|
||||||||
Aggregate benefit obligation
|
|
249,075
|
|
|
206,800
|
|
|
—
|
|
|
—
|
|
||||
Aggregate fair value of plan assets
|
|
157,560
|
|
|
135,505
|
|
|
—
|
|
|
—
|
|
||||
For defined benefit pension plans with accumulated benefit obligations in excess of plan assets:
|
|
|
|
|
|
|
|
|
||||||||
Aggregate accumulated benefit obligation
|
|
238,090
|
|
|
200,163
|
|
|
—
|
|
|
—
|
|
||||
Aggregate fair value of plan assets
|
|
157,560
|
|
|
135,505
|
|
|
—
|
|
|
—
|
|
|
|
Pension Benefits
|
|
Other Benefits
|
||||||||||||||||||||
(Thousands)
|
|
2012
|
|
2011
|
|
2010
|
|
2012
|
|
2011
|
|
2010
|
||||||||||||
Net periodic benefit cost
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Service cost
|
|
$
|
7,915
|
|
|
$
|
6,955
|
|
|
$
|
5,135
|
|
|
$
|
285
|
|
|
$
|
284
|
|
|
$
|
273
|
|
Interest cost
|
|
9,912
|
|
|
9,786
|
|
|
9,156
|
|
|
1,440
|
|
|
1,596
|
|
|
1,738
|
|
||||||
Expected return on plan assets
|
|
(11,934
|
)
|
|
(11,050
|
)
|
|
(10,441
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Amortization of prior service cost (benefit)
|
|
(335
|
)
|
|
(335
|
)
|
|
(530
|
)
|
|
86
|
|
|
(36
|
)
|
|
(36
|
)
|
||||||
Recognized net actuarial loss
|
|
5,605
|
|
|
3,920
|
|
|
2,834
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net periodic benefit cost
|
|
$
|
11,163
|
|
|
$
|
9,276
|
|
|
$
|
6,154
|
|
|
$
|
1,811
|
|
|
$
|
1,844
|
|
|
$
|
1,975
|
|
|
Pension Benefits
|
|
Other Benefits
|
||||||||||||||||||||
(Thousands)
|
2012
|
|
2011
|
|
2010
|
|
2012
|
|
2011
|
|
2010
|
||||||||||||
Change in other comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
OCI at beginning of year
|
$
|
104,056
|
|
|
$
|
69,716
|
|
|
$
|
62,886
|
|
|
$
|
1,180
|
|
|
$
|
(275
|
)
|
|
$
|
(2,085
|
)
|
Increase (decrease) in OCI:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Recognized during year — prior service cost (credit)
|
335
|
|
|
335
|
|
|
530
|
|
|
(87
|
)
|
|
36
|
|
|
36
|
|
||||||
Recognized during year — net actuarial (losses)
|
(5,605
|
)
|
|
(3,920
|
)
|
|
(2,834
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Occurring during year — prior service cost
|
117
|
|
|
430
|
|
|
739
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Occurring during year — net actuarial losses
|
25,995
|
|
|
37,543
|
|
|
8,390
|
|
|
1,494
|
|
|
1,419
|
|
|
1,774
|
|
||||||
Other adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Foreign currency exchange rate changes
|
57
|
|
|
(48
|
)
|
|
5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
OCI at end of year
|
$
|
124,955
|
|
|
$
|
104,056
|
|
|
$
|
69,716
|
|
|
$
|
2,587
|
|
|
$
|
1,180
|
|
|
$
|
(275
|
)
|
|
|
Pension Benefits
|
|
Other Benefits
|
||||||||||||||
|
|
2012
|
|
2011
|
|
2010
|
|
2012
|
|
2011
|
|
2010
|
||||||
Weighted-average assumptions used to determine benefit obligations at fiscal year end
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Discount rate
|
|
3.99
|
%
|
|
4.78
|
%
|
|
N/A
|
|
|
3.75
|
%
|
|
4.50
|
%
|
|
N/A
|
|
Rate of compensation increase
|
|
4.44
|
%
|
|
4.46
|
%
|
|
N/A
|
|
|
4.50
|
%
|
|
4.50
|
%
|
|
N/A
|
|
Weighted-average assumptions used to determine net cost for the fiscal year
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Discount rate
|
|
4.81
|
%
|
|
5.49
|
%
|
|
5.86
|
%
|
|
4.50
|
%
|
|
5.13
|
%
|
|
5.88
|
%
|
Expected long-term return on plan assets
|
|
7.65
|
%
|
|
7.88
|
%
|
|
8.18
|
%
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
Rate of compensation increase
|
|
4.43
|
%
|
|
3.97
|
%
|
|
2.99
|
%
|
|
4.50
|
%
|
|
4.00
|
%
|
|
3.00
|
%
|
Assumed health care trend rates at fiscal year end
|
|
2012
|
|
2011
|
Health care trend rate assumed for next year
|
|
8.00%
|
|
8.00%
|
Rate that the trend rate gradually declines to (ultimate trend rate)
|
|
5.00%
|
|
5.00%
|
Year that the rate reaches the ultimate trend rate
|
|
2019
|
|
2019
|
|
|
1-Percentage-
Point Increase
|
|
1-Percentage-
Point Decrease
|
||||||||||||
(Thousands)
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||
Effect on total of service and interest cost components
|
|
$
|
35
|
|
|
$
|
33
|
|
|
$
|
(31
|
)
|
|
$
|
(30
|
)
|
Effect on post-retirement benefit obligation
|
|
827
|
|
|
806
|
|
|
(723
|
)
|
|
(711
|
)
|
|
|
December 31, 2012
|
||||||||||||||
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
(Thousands)
|
|
|
|
|
|
|
|
|
||||||||
Cash
|
|
$
|
7,388
|
|
|
$
|
7,388
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Equity securities:
|
|
|
|
|
|
|
|
|
||||||||
U.S. (a)
|
|
54,691
|
|
|
45,025
|
|
|
9,666
|
|
|
—
|
|
||||
International (b)
|
|
22,683
|
|
|
19,650
|
|
|
3,033
|
|
|
—
|
|
||||
Emerging markets (c)
|
|
14,786
|
|
|
14,535
|
|
|
251
|
|
|
—
|
|
||||
Fixed income securities:
|
|
|
|
|
|
|
|
|
||||||||
Intermediate-term bonds (d)
|
|
26,749
|
|
|
18,378
|
|
|
8,371
|
|
|
—
|
|
||||
Short-term bonds (e)
|
|
11,656
|
|
|
11,656
|
|
|
—
|
|
|
—
|
|
||||
Global bonds (f)
|
|
12,854
|
|
|
11,185
|
|
|
1,669
|
|
|
—
|
|
||||
Other types of investments:
|
|
|
|
|
|
|
|
|
||||||||
Real estate fund (g)
|
|
7,793
|
|
|
7,768
|
|
|
25
|
|
|
—
|
|
||||
Multi-strategy hedge funds (h)
|
|
4,191
|
|
|
—
|
|
|
—
|
|
|
$
|
4,191
|
|
|||
Private equity funds
|
|
645
|
|
|
—
|
|
|
—
|
|
|
645
|
|
||||
Total
|
|
$
|
163,436
|
|
|
$
|
135,585
|
|
|
$
|
23,015
|
|
|
$
|
4,836
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
December 31, 2011
|
||||||||||||||
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
(Thousands)
|
|
|
|
|
|
|
|
|
||||||||
Cash
|
|
$
|
9,280
|
|
|
$
|
9,280
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Equity securities:
|
|
|
|
|
|
|
|
|
||||||||
U.S. (a)
|
|
46,004
|
|
|
37,859
|
|
|
8,145
|
|
|
—
|
|
||||
International (b)
|
|
19,096
|
|
|
9,355
|
|
|
9,741
|
|
|
—
|
|
||||
Emerging markets (c)
|
|
10,784
|
|
|
10,569
|
|
|
215
|
|
|
—
|
|
||||
Fixed income securities:
|
|
|
|
|
|
|
|
|
||||||||
Intermediate-term bonds (d)(i)
|
|
22,684
|
|
|
14,673
|
|
|
8,011
|
|
|
—
|
|
||||
Short-term bonds (e)
|
|
11,122
|
|
|
11,122
|
|
|
—
|
|
|
—
|
|
||||
Global bonds (f)
|
|
10,999
|
|
|
10,353
|
|
|
646
|
|
|
—
|
|
||||
Other types of investments:
|
|
|
|
|
|
|
|
|
||||||||
Real estate fund (g)
|
|
5,704
|
|
|
5,704
|
|
|
—
|
|
|
—
|
|
||||
Multi-strategy hedge funds (h)
|
|
3,989
|
|
|
—
|
|
|
—
|
|
|
$
|
3,989
|
|
|||
Private equity funds
|
|
682
|
|
|
—
|
|
|
—
|
|
|
682
|
|
||||
Total
|
|
$
|
140,344
|
|
|
$
|
108,915
|
|
|
$
|
26,758
|
|
|
$
|
4,671
|
|
(a)
|
Mutual funds that invest in various sectors of the U.S. market.
|
(b)
|
Mutual funds that invest in non-U.S. companies primarily in developed countries that are generally considered to be value stocks.
|
(c)
|
Mutual funds that invest in non-U.S. companies in emerging market countries.
|
(d)
|
Includes a mutual fund that employs a value-oriented approach to fixed income investment management and a mutual fund that invests primarily in investment-grade debt securities.
|
(e)
|
Includes a mutual fund that seeks a market rate of return for a fixed-income portfolio with low relative volatility of returns, investing generally in U.S. and foreign debt securities maturing in
five years or less
.
|
(f)
|
Mutual funds that invest in domestic and foreign sovereign securities, fixed income securities, mortgage-backed and asset-backed bonds, convertible bonds, high yield bonds and emerging market bonds.
|
(g)
|
Includes a mutual fund that typically invests at least
80%
of its assets in equity and debt securities of companies in the real estate industry or related industries or in companies which own significant real estate assets at the time of investment.
|
(h)
|
Includes a hedge fund that employs multiple strategies to multiple asset classes with low correlations.
|
(i)
|
The portion of intermediate-term bonds shown as Level 2 had been shown as Level 1 in the previous year. The valuation method for these U.S. government securities and corporate bonds is better reflected as Level 2 assets.
|
(Thousands)
|
|
Multi-
strategy
Hedge Funds
|
|
Private
Equity
Funds
|
|
Total
|
||||||
Balance as of January 1, 2011
|
|
$
|
3,851
|
|
|
$
|
546
|
|
|
$
|
4,397
|
|
Actual return:
|
|
|
|
|
|
|
||||||
On assets still held at reporting date
|
|
376
|
|
|
172
|
|
|
548
|
|
|||
On assets sold during the period
|
|
—
|
|
|
5
|
|
|
5
|
|
|||
Purchases, sales and settlements
|
|
(238
|
)
|
|
(41
|
)
|
|
(279
|
)
|
|||
Balance as of December 31, 2011
|
|
$
|
3,989
|
|
|
$
|
682
|
|
|
$
|
4,671
|
|
Actual return:
|
|
|
|
|
|
|
||||||
On assets still held at reporting date
|
|
386
|
|
|
17
|
|
|
403
|
|
|||
On assets sold during the period
|
|
(57
|
)
|
|
4
|
|
|
(53
|
)
|
|||
Purchases, sales and settlements
|
|
(127
|
)
|
|
(58
|
)
|
|
(185
|
)
|
|||
Balance as of December 31, 2012
|
|
$
|
4,191
|
|
|
$
|
645
|
|
|
$
|
4,836
|
|
|
|
Other Benefits
|
||||||||||
|
|
Pension Benefits
|
|
Gross Benefit
Payment
|
|
Net of
Medicare
Part D
Subsidy
|
||||||
(Thousands)
|
|
|
|
|
|
|
||||||
2013
|
|
$
|
9,025
|
|
|
$
|
2,663
|
|
|
$
|
2,287
|
|
2014
|
|
9,375
|
|
|
2,700
|
|
|
2,302
|
|
|||
2015
|
|
9,661
|
|
|
2,743
|
|
|
2,320
|
|
|||
2016
|
|
10,344
|
|
|
2,755
|
|
|
2,309
|
|
|||
2017
|
|
13,507
|
|
|
2,815
|
|
|
2,343
|
|
|||
2018 through 2022
|
|
71,056
|
|
|
13,597
|
|
|
10,720
|
|
(Thousands)
|
|
2012
|
|
2011
|
||||
Reserve balance at beginning of year
|
|
$
|
(5,312
|
)
|
|
$
|
(5,201
|
)
|
Expensed
|
|
(316
|
)
|
|
(528
|
)
|
||
Paid
|
|
327
|
|
|
417
|
|
||
Reserve balance at end of year
|
|
$
|
(5,301
|
)
|
|
$
|
(5,312
|
)
|
Ending balance recorded in:
|
|
|
|
|
||||
Other liabilities and accrued items
|
|
$
|
(903
|
)
|
|
$
|
(1,000
|
)
|
Other long-term liabilities
|
|
(4,398
|
)
|
|
(4,312
|
)
|
(Shares in thousands)
|
|
Number of
Options
|
|
Weighted-
average
Exercise
Price Per
Share
|
|
Aggregate
Intrinsic
Value
|
|
Weighted-
average
Remaining
Term (Years)
|
|||||
Outstanding at December 31, 2011
|
|
113
|
|
|
$
|
15.03
|
|
|
|
|
|
||
Exercised
|
|
(16
|
)
|
|
9.75
|
|
|
|
|
|
|||
Canceled
|
|
(1
|
)
|
|
7.27
|
|
|
|
|
|
|||
Outstanding at December 31, 2012
|
|
96
|
|
|
15.98
|
|
|
$
|
943,000
|
|
|
1.4
|
|
Vested and expected to vest as of December 31, 2012
|
|
96
|
|
|
15.98
|
|
|
943,000
|
|
|
1.4
|
||
Exercisable at December 31, 2012
|
|
96
|
|
|
15.98
|
|
|
943,000
|
|
|
1.4
|
|
|
Number
Outstanding
and Exercisable
(Thousands)
|
|
Weighted-
average
Remaining
Life (Years)
|
|
Weighted-
average
Exercise
Price
|
|||
Range of Option Prices
|
|
|
|
|
|
|
|||
$5.55 - $8.10
|
|
11
|
|
|
0.4
|
|
$
|
6.75
|
|
$14.80-$16.10
|
|
8
|
|
|
1.8
|
|
15.45
|
|
|
$17.075-$17.58
|
|
77
|
|
|
1.5
|
|
17.31
|
|
|
|
|
96
|
|
|
1.4
|
|
$
|
15.98
|
|
(Shares in thousands)
|
|
Number of
Shares
|
|
Weighted-
average
Grant Date
Fair Value
|
|||
Outstanding at December 31, 2011
|
|
311
|
|
|
$
|
23.89
|
|
Granted
|
|
76
|
|
|
27.87
|
|
|
Vested
|
|
(113
|
)
|
|
28.37
|
|
|
Forfeited
|
|
(51
|
)
|
|
28.93
|
|
|
Outstanding at December 31, 2012
|
|
223
|
|
|
$
|
30.18
|
|
(Shares in thousands)
|
|
Number of
Shares
|
|
Weighted-
average
Grant Date
Fair Value
|
|||
Outstanding at December 31, 2011
|
|
101
|
|
|
$
|
26.42
|
|
Granted
|
|
8
|
|
|
23.10
|
|
|
Distributed
|
|
(6
|
)
|
|
(26.40
|
)
|
|
Outstanding at December 31, 2012
|
|
103
|
|
|
$
|
38.68
|
|
(Shares in thousands)
|
|
Number of
SARs
|
|
Weighted-
average
Exercise
Price Per
Share
|
|
Aggregate
Intrinsic
Value
|
|
Weighted-
average
Remaining
Term (Years)
|
|||||
Outstanding at December 31, 2011
|
|
841
|
|
|
$
|
23.39
|
|
|
|
|
|
||
Granted
|
|
185
|
|
|
29.45
|
|
|
|
|
|
|||
Exercised
|
|
(33
|
)
|
|
15.01
|
|
|
|
|
|
|||
Outstanding at December 31, 2012
|
|
993
|
|
|
24.80
|
|
|
$
|
4,473,000
|
|
|
5.9
|
|
Vested and expected to vest as of December 31, 2012
|
|
993
|
|
|
24.80
|
|
|
4,473,000
|
|
|
5.9
|
||
Exercisable at December 31, 2012
|
|
444
|
|
|
19.65
|
|
|
3,511,000
|
|
|
5.5
|
SARs Prices
|
|
Number
Outstanding
(Thousands)
|
|
Weighted-
average
Remaining
Life (Years)
|
|
Weighted-
average
Exercise
Price
|
|||
$15.01
|
316
|
|
|
6.1
|
|
$
|
15.01
|
|
|
$21.24-$24.03
|
272
|
|
|
6.2
|
|
21.86
|
|
||
$27.78-$29.45
|
214
|
|
|
5.3
|
|
29.23
|
|
||
$34.30-$39.30
|
152
|
|
|
5.3
|
|
39.19
|
|
||
$44.72
|
39
|
|
|
4.1
|
|
44.72
|
|
||
|
|
993
|
|
|
5.9
|
|
$
|
24.80
|
|
|
|
2012
|
|
2011
|
|
2010
|
|||
Risk-free interest rate
|
|
0.89
|
%
|
|
0.03
|
%
|
|
0.11
|
%
|
Dividend yield
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Volatility
|
|
50.0
|
%
|
|
58.7
|
%
|
|
58.0
|
%
|
Expected lives (in years)
|
|
5.0
|
|
|
6.5
|
|
|
6.5
|
|
|
|
December 31,
|
||||||||||
(Thousands)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Foreign currency translation adjustment
|
|
$
|
4,077
|
|
|
$
|
4,947
|
|
|
$
|
3,989
|
|
Derivative financial instruments
|
|
|
|
|
|
|
||||||
Gross
|
|
350
|
|
|
1,450
|
|
|
(1,543
|
)
|
|||
Deferred tax (benefit)
|
|
(1,280
|
)
|
|
(895
|
)
|
|
(1,942
|
)
|
|||
Net
|
|
1,630
|
|
|
2,345
|
|
|
399
|
|
|||
Pension and other retirement plan adjustment
|
|
|
|
|
|
|
||||||
Gross
|
|
(127,541
|
)
|
|
(105,236
|
)
|
|
(69,441
|
)
|
|||
Deferred tax (benefit)
|
|
(33,405
|
)
|
|
(25,729
|
)
|
|
(13,437
|
)
|
|||
Net
|
|
(94,136
|
)
|
|
(79,507
|
)
|
|
(56,004
|
)
|
|||
Total
|
|
$
|
(88,429
|
)
|
|
$
|
(72,215
|
)
|
|
$
|
(51,616
|
)
|
|
|
Advanced
Material
Technologies
|
|
Performance
Alloys
|
|
Beryllium
and
Composites
|
|
Technical
Materials
|
|
Subtotal
|
|
All
Other
|
|
Total
|
||||||||||||||
(Thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Sales to external customers
|
|
$
|
847,835
|
|
|
$
|
292,448
|
|
|
$
|
59,983
|
|
|
$
|
72,733
|
|
|
$
|
1,272,999
|
|
|
$
|
79
|
|
|
$
|
1,273,078
|
|
Intersegment sales
|
|
2,556
|
|
|
2,718
|
|
|
740
|
|
|
672
|
|
|
6,686
|
|
|
—
|
|
|
6,686
|
|
|||||||
Operating profit (loss)
|
|
16,749
|
|
|
24,004
|
|
|
(3,944
|
)
|
|
6,608
|
|
|
43,417
|
|
|
(6,641
|
)
|
|
36,776
|
|
|||||||
Depreciation, depletion and amortization
|
|
16,282
|
|
|
14,994
|
|
|
1,883
|
|
|
2,609
|
|
|
35,768
|
|
|
1,278
|
|
|
37,046
|
|
|||||||
Expenditures for long-lived assets
|
|
11,874
|
|
|
19,906
|
|
|
7,962
|
|
|
3,604
|
|
|
43,346
|
|
|
1,315
|
|
|
44,661
|
|
|||||||
Assets
|
|
341,604
|
|
|
269,003
|
|
|
135,414
|
|
|
23,328
|
|
|
769,349
|
|
|
45,568
|
|
|
814,917
|
|
|||||||
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Sales to external customers
|
|
$
|
1,051,823
|
|
|
$
|
335,323
|
|
|
$
|
60,557
|
|
|
$
|
78,732
|
|
|
$
|
1,526,435
|
|
|
$
|
295
|
|
|
$
|
1,526,730
|
|
Intersegment sales
|
|
2,493
|
|
|
3,771
|
|
|
757
|
|
|
2,167
|
|
|
9,188
|
|
|
—
|
|
|
9,188
|
|
|||||||
Operating profit (loss)
|
|
33,471
|
|
|
27,241
|
|
|
(754
|
)
|
|
7,262
|
|
|
67,220
|
|
|
(10,142
|
)
|
|
57,078
|
|
|||||||
Depreciation, depletion and amortization
|
|
16,170
|
|
|
22,324
|
|
|
1,367
|
|
|
2,459
|
|
|
42,320
|
|
|
1,315
|
|
|
43,635
|
|
|||||||
Expenditures for long-lived assets
|
|
8,014
|
|
|
10,599
|
|
|
6,460
|
|
|
2,286
|
|
|
27,359
|
|
|
1,388
|
|
|
28,747
|
|
|||||||
Assets
|
|
342,819
|
|
|
235,547
|
|
|
127,708
|
|
|
21,502
|
|
|
727,576
|
|
|
44,527
|
|
|
772,103
|
|
|||||||
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Sales to external customers
|
|
$
|
878,994
|
|
|
$
|
293,757
|
|
|
$
|
61,894
|
|
|
$
|
67,450
|
|
|
$
|
1,302,095
|
|
|
$
|
219
|
|
|
$
|
1,302,314
|
|
Intersegment sales
|
|
1,718
|
|
|
6,086
|
|
|
397
|
|
|
2,597
|
|
|
10,798
|
|
|
—
|
|
|
10,798
|
|
|||||||
Operating profit (loss)
|
|
39,454
|
|
|
27,150
|
|
|
10,046
|
|
|
5,331
|
|
|
81,981
|
|
|
(8,348
|
)
|
|
73,633
|
|
|||||||
Depreciation, depletion and amortization
|
|
16,443
|
|
|
14,186
|
|
|
1,070
|
|
|
2,449
|
|
|
34,148
|
|
|
1,246
|
|
|
35,394
|
|
|||||||
Expenditures for long-lived assets
|
|
5,170
|
|
|
17,060
|
|
|
29,123
|
|
|
950
|
|
|
52,303
|
|
|
1,359
|
|
|
53,662
|
|
|||||||
Assets
|
|
339,490
|
|
|
219,094
|
|
|
119,117
|
|
|
22,751
|
|
|
700,452
|
|
|
34,958
|
|
|
735,410
|
|
(Thousands)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Sales from U.S. operations
|
|
$
|
1,064,779
|
|
|
$
|
1,306,192
|
|
|
$
|
1,079,700
|
|
Sales based upon location of customers
|
|
|
|
|
|
|
||||||
United States
|
|
$
|
881,968
|
|
|
$
|
1,143,720
|
|
|
$
|
933,264
|
|
All other
|
|
391,110
|
|
|
383,010
|
|
|
369,050
|
|
|||
Total
|
|
$
|
1,273,078
|
|
|
$
|
1,526,730
|
|
|
$
|
1,302,314
|
|
Long-lived assets by country deployed
|
|
|
|
|
|
|
||||||
United States
|
|
$
|
354,122
|
|
|
$
|
349,988
|
|
|
$
|
363,738
|
|
All other
|
|
36,042
|
|
|
32,441
|
|
|
11,915
|
|
|||
Total
|
|
$
|
390,164
|
|
|
$
|
382,429
|
|
|
$
|
375,653
|
|
|
|
Income (Expense)
|
||||||||||
(Thousands)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Foreign currency exchange/translation gain (loss)
|
|
$
|
1,477
|
|
|
$
|
(2,775
|
)
|
|
$
|
(759
|
)
|
Amortization of intangible assets
|
|
(6,008
|
)
|
|
(6,144
|
)
|
|
(6,462
|
)
|
|||
Metal consignment fees
|
|
(9,011
|
)
|
|
(9,877
|
)
|
|
(6,539
|
)
|
|||
Changes to earn-out valuation
|
|
—
|
|
|
1,052
|
|
|
848
|
|
|||
Equipment write-off (see below)
|
|
(1,603
|
)
|
|
—
|
|
|
—
|
|
|||
Other items
|
|
(464
|
)
|
|
1,970
|
|
|
(1,915
|
)
|
|||
Total
|
|
$
|
(15,609
|
)
|
|
$
|
(15,774
|
)
|
|
$
|
(14,827
|
)
|
(Thousands)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Interest incurred
|
|
$
|
3,334
|
|
|
$
|
2,860
|
|
|
$
|
2,696
|
|
Less capitalized interest
|
|
200
|
|
|
48
|
|
|
31
|
|
|||
Total net expense
|
|
$
|
3,134
|
|
|
$
|
2,812
|
|
|
$
|
2,665
|
|
Interest paid
|
|
$
|
2,639
|
|
|
$
|
2,211
|
|
|
$
|
2,225
|
|
Amortization of capitalized interest included in cost of sales
|
|
$
|
336
|
|
|
$
|
441
|
|
|
$
|
499
|
|
(Thousands)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Income before income taxes:
|
|
|
|
|
|
|
||||||
Domestic
|
|
$
|
23,379
|
|
|
$
|
53,648
|
|
|
$
|
65,489
|
|
Foreign
|
|
10,263
|
|
|
618
|
|
|
5,479
|
|
|||
Total income before income taxes
|
|
$
|
33,642
|
|
|
$
|
54,266
|
|
|
$
|
70,968
|
|
|
|
|
|
|
|
|
||||||
Income taxes:
|
|
|
|
|
|
|
||||||
Current income taxes:
|
|
|
|
|
|
|
||||||
Domestic
|
|
$
|
7,825
|
|
|
$
|
15,487
|
|
|
$
|
10,130
|
|
Foreign
|
|
3,615
|
|
|
468
|
|
|
788
|
|
|||
Total current
|
|
$
|
11,440
|
|
|
$
|
15,955
|
|
|
$
|
10,918
|
|
|
|
|
|
|
|
|
||||||
Deferred income taxes:
|
|
|
|
|
|
|
||||||
Domestic
|
|
$
|
(3,084
|
)
|
|
$
|
(2,710
|
)
|
|
$
|
14,075
|
|
Foreign
|
|
(44
|
)
|
|
(351
|
)
|
|
719
|
|
|||
Valuation allowance
|
|
666
|
|
|
1,393
|
|
|
(1,171
|
)
|
|||
Total deferred
|
|
$
|
(2,462
|
)
|
|
$
|
(1,668
|
)
|
|
$
|
13,623
|
|
|
|
|
|
|
|
|
||||||
Total income taxes
|
|
$
|
8,978
|
|
|
$
|
14,287
|
|
|
$
|
24,541
|
|
|
|
2012
|
|
2011
|
|
2010
|
|||
Federal statutory rate
|
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
State and local income taxes, net of federal tax effect
|
|
(0.3
|
)
|
|
0.7
|
|
|
(0.4
|
)
|
Effect of excess of percentage depletion over cost depletion
|
|
(7.3
|
)
|
|
(3.9
|
)
|
|
(2.5
|
)
|
Medicare Part D
|
|
—
|
|
|
—
|
|
|
2.2
|
|
Manufacturing production deduction
|
|
(2.2
|
)
|
|
(3.5
|
)
|
|
(1.9
|
)
|
Officers’ compensation
|
|
1.1
|
|
|
0.7
|
|
|
1.5
|
|
Adjustment to unrecognized tax benefits
|
|
(0.6
|
)
|
|
(3.4
|
)
|
|
0.8
|
|
Taxes on foreign source income
|
|
(0.1
|
)
|
|
(0.2
|
)
|
|
(1.3
|
)
|
Retiree medical expense
|
|
(2.0
|
)
|
|
—
|
|
|
—
|
|
Valuation allowance
|
|
2.0
|
|
|
2.5
|
|
|
1.6
|
|
Other items
|
|
1.1
|
|
|
(1.6
|
)
|
|
(0.4
|
)
|
Effective tax rate
|
|
26.7
|
%
|
|
26.3
|
%
|
|
34.6
|
%
|
|
|
December 31,
|
||||||
(Thousands)
|
|
2012
|
|
2011
|
||||
Asset (liability)
|
|
|
|
|
||||
Post-retirement benefits other than pensions
|
|
$
|
12,003
|
|
|
$
|
11,047
|
|
Other reserves
|
|
12,804
|
|
|
11,476
|
|
||
Environmental reserves
|
|
1,958
|
|
|
1,932
|
|
||
Inventory
|
|
4,303
|
|
|
3,776
|
|
||
Pensions
|
|
27,547
|
|
|
21,790
|
|
||
Net operating loss and credit carryforwards
|
|
5,186
|
|
|
5,199
|
|
||
Miscellaneous
|
|
357
|
|
|
377
|
|
||
Subtotal
|
|
64,158
|
|
|
55,597
|
|
||
Valuation allowance
|
|
(4,584
|
)
|
|
(3,917
|
)
|
||
Total deferred tax assets
|
|
59,574
|
|
|
51,680
|
|
||
Depreciation
|
|
(19,388
|
)
|
|
(21,133
|
)
|
||
Amortization
|
|
(7,939
|
)
|
|
(8,016
|
)
|
||
Capitalized interest expense
|
|
(195
|
)
|
|
(224
|
)
|
||
Mine development
|
|
(2,832
|
)
|
|
(782
|
)
|
||
Derivative instruments and hedging activities
|
|
(168
|
)
|
|
(581
|
)
|
||
Total deferred tax liabilities
|
|
(30,522
|
)
|
|
(30,736
|
)
|
||
Net deferred tax asset
|
|
$
|
29,052
|
|
|
$
|
20,944
|
|
(Thousands)
|
|
2012
|
|
2011
|
||||
Balance as of January 1
|
|
$
|
1,969
|
|
|
$
|
2,944
|
|
Additions to tax provisions related to the current year
|
|
149
|
|
|
—
|
|
||
Additions to tax positions related to prior years
|
|
174
|
|
|
878
|
|
||
Reduction to tax positions related to prior years
|
|
(20
|
)
|
|
—
|
|
||
Lapses on statutes of limitations
|
|
(455
|
)
|
|
(1,853
|
)
|
||
Settlements
|
|
(50
|
)
|
|
—
|
|
||
Balance as of December 31
|
|
$
|
1,767
|
|
|
$
|
1,969
|
|
(Thousands except per share amounts)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Numerator for basic and diluted EPS:
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
24,664
|
|
|
$
|
39,979
|
|
|
$
|
46,427
|
|
Denominator:
|
|
|
|
|
|
|
||||||
Denominator for basic EPS:
|
|
|
|
|
|
|
||||||
Weighted-average shares outstanding
|
|
20,418
|
|
|
20,365
|
|
|
20,282
|
|
|||
Effect of dilutive securities:
|
|
|
|
|
|
|
||||||
Stock options and stock appreciation rights
|
|
163
|
|
|
237
|
|
|
156
|
|
|||
Restricted stock
|
|
94
|
|
|
152
|
|
|
151
|
|
|||
Performance restricted shares
|
|
4
|
|
|
—
|
|
|
1
|
|
|||
Diluted potential common shares
|
|
261
|
|
|
389
|
|
|
308
|
|
|||
Denominator for diluted EPS:
|
|
|
|
|
|
|
||||||
Adjusted weighted-average shares outstanding
|
|
20,679
|
|
|
20,754
|
|
|
20,590
|
|
|||
Basic EPS
|
|
$
|
1.21
|
|
|
$
|
1.96
|
|
|
$
|
2.29
|
|
Diluted EPS
|
|
$
|
1.19
|
|
|
$
|
1.93
|
|
|
$
|
2.25
|
|
|
|
2012
|
||||||||||||||||||
(Dollars in thousands except per share amounts)
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
|
Total
|
||||||||||
Net sales
|
|
$
|
353,630
|
|
|
$
|
325,088
|
|
|
$
|
290,601
|
|
|
$
|
303,759
|
|
|
$
|
1,273,078
|
|
Gross margin
|
|
49,418
|
|
|
53,024
|
|
|
52,369
|
|
|
43,972
|
|
|
198,783
|
|
|||||
Percent of sales
|
|
14.0
|
%
|
|
16.3
|
%
|
|
18.0
|
%
|
|
14.5
|
%
|
|
15.6
|
%
|
|||||
Net income
|
|
$
|
6,118
|
|
|
$
|
7,929
|
|
|
$
|
8,114
|
|
|
$
|
2,503
|
|
|
$
|
24,664
|
|
Net income per share of common stock:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
0.30
|
|
|
0.39
|
|
|
0.40
|
|
|
0.12
|
|
|
1.21
|
|
|||||
Diluted
|
|
0.30
|
|
|
0.38
|
|
|
0.39
|
|
|
0.12
|
|
|
1.19
|
|
|||||
Dividends per share of common stock
|
|
—
|
|
|
0.075
|
|
|
0.075
|
|
|
0.075
|
|
|
0.225
|
|
|||||
Stock price range:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
High
|
|
32.91
|
|
|
29.37
|
|
|
25.57
|
|
|
25.93
|
|
|
|
||||||
Low
|
|
24.77
|
|
|
20.37
|
|
|
17.59
|
|
|
18.84
|
|
|
|
||||||
|
|
2011
|
||||||||||||||||||
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
|
Total
|
||||||||||
Net sales
|
|
$
|
374,805
|
|
|
$
|
424,710
|
|
|
$
|
392,794
|
|
|
$
|
334,421
|
|
|
$
|
1,526,730
|
|
Gross margin
|
|
55,800
|
|
|
62,671
|
|
|
57,350
|
|
|
39,500
|
|
|
215,321
|
|
|||||
Percent of sales
|
|
14.9
|
%
|
|
14.8
|
%
|
|
14.6
|
%
|
|
11.8
|
%
|
|
14.1
|
%
|
|||||
Net income
|
|
$
|
11,818
|
|
|
$
|
13,872
|
|
|
$
|
13,527
|
|
|
$
|
762
|
|
|
$
|
39,979
|
|
Net income per share of common stock:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
0.58
|
|
|
0.68
|
|
|
0.66
|
|
|
0.04
|
|
|
1.96
|
|
|||||
Diluted
|
|
0.57
|
|
|
0.67
|
|
|
0.65
|
|
|
0.04
|
|
|
1.93
|
|
|||||
Stock price range:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
High
|
|
44.94
|
|
|
44.00
|
|
|
42.05
|
|
|
30.15
|
|
|
|
||||||
Low
|
|
33.99
|
|
|
33.02
|
|
|
21.11
|
|
|
19.53
|
|
|
|
Item 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
Item 9A.
|
CONTROLS AND PROCEDURES
|
Item 9B.
|
OTHER INFORMATION
|
Item 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
Item 11.
|
EXECUTIVE COMPENSATION
|
Item 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
Item 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
Item 14.
|
PRINCIPAL ACCOUNTANT FEES AND SERVICES
|
Item 15.
|
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
|
(a)
|
1. Financial Statements and Supplemental Information
|
(a)
|
2. Financial Statement Schedules
|
(a)
|
3. Exhibits
|
|
|
|
(3a)
|
|
Amended and Restated Articles of Incorporation of Brush Engineered Materials Inc. (filed as Annex B to the Registration Statement on Form S-4 (File No. 1-15885) filed by the Company on February 1, 2000, Registration No. 333-95917), incorporated herein by reference.
|
|
|
|
(3b)
|
|
Amendment to Amended and Restated Articles of Incorporation (filed as Exhibit 3(a) to the Company’s Form 8-K (File No. 1-15885) on March 8, 2011), incorporated herein by reference.
|
|
|
|
(3c)
|
|
Amended and Restated Code of Regulations (filed as Exhibit 3 to the Company’s Quarterly Report on Form 10-Q (File No. 1-15885) for the period ending on July 1, 2011), incorporated herein by reference.
|
|
|
|
(4a)
|
|
Indenture Modification between Toledo-Lucas County Port Authority, dated as of May 30, 2003 (filed as Exhibit 4 to the Company’s Quarterly Report on Form 10-Q (File No. 1-15885) for the period ending June 27, 2003), incorporated herein by reference.
|
|
|
|
(4b)
|
|
Pursuant to Regulation S-K, Item 601(b)(4), the Company agrees to furnish to the Securities and Exchange Commission, upon its request, a copy of the instruments defining the rights of holders of long-term debt of the Company that are not being filed with this report.
|
|
|
|
(4c)
|
|
Amended and Restated Credit Agreement dated July 13, 2011 among Materion Corporation, Materion Advanced Materials Technologies and Services Netherlands B.V., JPMorgan Chase Bank, N.A. and other lenders from time to time party thereto (filed as Exhibit 10.1 to the Registrant’s Form 8-K (File No. 1-15885) filed on July 18, 2011), incorporated herein by reference.
|
|
|
|
(4d)
|
|
Third Amended and Restated Precious Metals Agreement dated October 1, 2010, between Brush Engineered Materials Inc. and other borrowers and The Bank of Nova Scotia (filed as Exhibit 4.2 to the Company’s Form 8-K (File No. 1-15885) on October 4, 2010), incorporated herein by reference.
|
|
|
|
(4e)
|
|
Amendment No. 1 to the Third Amended and Restated Precious Metals Agreement dated March 31, 2011, among Materion Corporation and other borrowers and The Bank of Nova Scotia (filed as Exhibit 10.1 to the Company’s Form 8-K (File No. 1-15885) on April 6, 2011), incorporated herein by reference.
|
|
|
|
(4f)
|
|
Amendment No. 2 to the Third Amended and Restated Precious Metals Agreement dated August 18, 2011, among Materion Corporation and other borrowers and The Bank of Nova Scotia (filed as Exhibit 10.1 to the Company’s Form 8-K (File No. 1-15885) filed on August 22, 2011), incorporated herein by reference.
|
|
|
|
(4g)
|
|
Amendment No. 3 to the Third Amended and Restated Precious Metals Agreement dated October 17, 2011, among Materion Corporation and other borrowers and The Bank of Nova Scotia (filed as Exhibit 10.1 to the Company’s Form 8-K (File No. 1-15885) filed on October 18, 2011), incorporated herein by reference.
|
|
|
|
(10a)
|
|
Form of Indemnification Agreement entered into by the Company and its executive officers (filed as Exhibit 10a to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 2008), incorporated herein by reference.
|
|
|
|
(10b)
|
|
Form of Indemnification Agreement entered into by the Company and its directors (filed as Exhibit 10b to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 2008), incorporated herein by reference.
|
|
|
|
(10c)*
|
|
Amended and Restated Form of Severance Agreement for Executive Officers (filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q (File No. 1-15885) for the period ending June 27, 2008), incorporated herein by reference.
|
|
|
|
(10d)*
|
|
Amendment No. 1 to Amended and Restated Severance Agreement, dated May 4, 2011 (filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q (File No. 1-15885) for the period ending July 1, 2011), incorporated herein by reference.
|
|
|
|
(10e)*
|
|
Amended and Restated Form of Severance Agreement for Key Employees (filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q (File No. 1-15885) for the period ending June 27, 2008), incorporated herein by reference.
|
|
|
|
(10f)*
|
|
Form of Executive Insurance Agreement entered into by the Company and certain employees dated January 2, 2002 (filed as Exhibit 10g to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 1994), incorporated herein by reference.
|
|
|
|
(10g)*
|
|
Form of Trust Agreement between the Company and Key Trust Company of Ohio, N.A. (formerly Ameritrust Company National Association) on behalf of the Company’s executive officers (filed as Exhibit 10e to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 1994), incorporated herein by reference.
|
|
|
|
(10h)*
|
|
2012 Management Incentive Plan (filed as Exhibit 10i to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 2011), incorporated herein by reference.
|
|
|
|
(10i)*#
|
|
2013 Management Incentive Plan.
|
|
|
|
(10j)*
|
|
1979 Stock Option Plan, as amended pursuant to approval of shareholders on April 21, 1982 (filed by Brush Wellman Inc. as Exhibit 15A to Post-Effective Amendment No. 3 to Registration Statement (File No. 1-15885) No. 2-64080), incorporated herein by reference.
|
|
|
|
(10k)*
|
|
Amendment, effective May 16, 2000, to the 1979 Stock Option Plan (filed as Exhibit 4b to Post- Effective Amendment No. 5 to Registration Statement on Form S-8 (File No. 1-15885), Registration No. 2-64080), incorporated herein by reference.
|
|
|
|
(10l)*
|
|
1984 Stock Option Plan as amended by the Board of Directors on April 18, 1984 and February 24, 1987 (filed by Brush Wellman Inc. as Exhibit 4.4 to Registration Statement on Form S-8 (File No. 1-15885), Registration No. 33-28605), incorporated herein by reference.
|
|
|
|
(10m)*
|
|
Amendment, effective May 16, 2000, to the 1984 Stock Option Plan (filed as Exhibit 4b to Post- Effective Amendment No. 1 to Registration Statement on Form S-8 (File No. 1-15885), Registration No. 2-90724), incorporated herein by reference.
|
|
|
|
(10n)*
|
|
1989 Stock Option Plan (filed as Exhibit 4.5 to Registration Statement on Form S-8 (File No. 1-15885), Registration No. 33-28605), incorporated herein by reference.
|
|
|
|
(10o)*
|
|
Amendment, effective May 16, 2000, to the 1989 Stock Option Plan (filed as Exhibit 4b to Post-Effective Amendment No. 1 to Registration Statement on Form S-8 (File No. 1-15885), Registration No. 33-28605), incorporated herein by reference.
|
|
|
|
(10p)*
|
|
1995 Stock Incentive Plan (as Amended March 3, 1998) (filed as Appendix A to the Company’s Proxy Statement (File No. 1-15885) dated March 16, 1998), incorporated herein by reference.
|
|
|
|
(10q)*
|
|
Amendment No. 1, effective May 16, 2000, to the 1995 Stock Incentive Plan (filed as Exhibit 4b to Post-Effective Amendment No. 1 to Registration Statement (File No. 1-15885) No. 333-63357), incorporated herein by reference.
|
|
|
|
(10r)*
|
|
Amendment No. 2, effective February 1, 2005, to the 1995 Stock Incentive Plan (filed as Exhibit 10.4 to the Current Report on Form 8-K (File No. 1-15885) filed by the Company on February 7, 2005) incorporated herein by reference.
|
|
|
|
(10s)*
|
|
Amended and Restated 2006 Stock Incentive Plan (filed as Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q (File No. 1-15885) for the period ended June 27, 2008), incorporated herein by reference.
|
|
|
|
|
|
|
(10t)*
|
|
Amended and Restated Materion Corporation 2006 Stock Incentive Plan (as Amended and Restated as of May 4, 2011) (filed as Exhibit 10.1 to the Registrant’s Form 8-K (File No. 1-15885) filed on May 5, 2011), incorporated herein by reference.
|
|
|
|
(10u)*
|
|
Form of Nonqualified Stock Option Agreement, (filed as Exhibit 10t to the Company’s Form 10-K (File No. 1-15885) Annual Report for the year ended December 31, 2004) incorporated herein by reference.
|
|
|
|
(10v)*
|
|
Form of Nonqualified Stock Option Agreement (filed as Exhibit 10.7 to the Current Report on Form 8-K (File No. 1-15885) filed by the Company on February 7, 2005) incorporated herein by reference.
|
|
|
|
(10w)*
|
|
Form of 2010 Restricted Stock Agreement (filed as Exhibit 10z to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 2009), incorporated herein by reference.
|
|
|
|
(10x)*
|
|
Form of 2010 Restricted Stock Units Agreement (filed as Exhibit 10aa to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 2009), incorporated herein by reference.
|
|
|
|
(10y)*
|
|
Form of 2011 Restricted Stock Units Agreement (Stock-settled) (filed as Exhibit 10.1 to the Company’s Form 8-K (File No. 1-15885) filed on March 3, 2011), incorporated herein by reference.
|
|
|
|
(10z)*
|
|
Form of 2011 Restricted Stock Units Agreement (Cash-settled) (filed as Exhibit 10.2 to the Company’s Form 8-K (File No. 1-15885) filed on March 3, 2011), incorporated herein by reference.
|
|
|
|
(10aa)*#
|
|
Form of 2012 Restricted Stock Units Agreement (Cash-Settled).
|
|
|
|
(10ab)*#
|
|
Form of 2012 Restricted Stock Units Agreement (Stock-Settled).
|
|
|
|
(10ac)*
|
|
Form of 2006 Stock Appreciation Rights Agreement (filed as Exhibit 10.3 to the Current Report on Form 8-K (File No. 1-15885) filed by the Company on May 8, 2006), incorporated herein by reference.
|
|
|
|
(10ad)*#
|
|
Form of 2012 Performance-Based Restricted Stock Units and Performance Shares Agreement (Cash-settled).
|
|
|
|
(10ae)*#
|
|
Form of 2012 Performance-Based Restricted Stock Units and Performance Shares Agreement (Stock-settled).
|
|
|
|
(10af)*
|
|
Form of 2007 Stock Appreciation Rights Agreement (filed as Exhibit 10.5 to Amendment No. 1 to the Current Report on Form 8-K (File No. 1-15885) filed by the Company on February 16, 2007), incorporated herein by reference.
|
|
|
|
(10ag)*
|
|
Form of 2008 Stock Appreciation Rights Agreement (filed as Exhibit 10an to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 2007), incorporated herein by reference.
|
|
|
|
(10ah)*
|
|
Form of 2009 Stock Appreciation Rights Agreement (filed as Exhibit 10ag to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 2008), incorporated herein by reference.
|
|
|
|
(10ai)*
|
|
Form of 2010 Stock Appreciation Rights Agreement (filed as Exhibit 10ah to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 2009), incorporated herein by reference.
|
|
|
|
(10aj)*
|
|
Form of 2011 Stock Appreciation Rights Agreement (filed as Exhibit 10.3 to the Company’s Form 8-K (File No. 1-15885) filed on March 3, 2011), incorporated herein by reference.
|
|
|
|
(10ak)*
|
|
Materion Corporation Supplemental Retirement Benefit Plan (filed as Exhibit 10.1 to the Company’s Form 8-K (File No. 1-15885) filed on September 19, 2011), incorporated herein by reference.
|
|
|
|
(10al)*#
|
|
Amendment No. 1 to the Supplemental Retirement Benefit Plan.
|
|
|
|
(10am)*
|
|
Key Employee Share Option Plan (filed as Exhibit 4.1 to the Registration Statement on Form S-8 (File No. 1-15885), Registration No. 333-52141, filed by Brush Wellman Inc. on May 5, 1998), incorporated herein by reference.
|
|
|
|
(10an)*
|
|
Amendment No. 1 to the Key Employee Share Option Plan, (effective May 16, 2005) (filed as Exhibit 4b to Post-Effective Amendment No. 1 to Registration Statement on Form S-8 (File No. 1-15885), Registration No. 333-52141), incorporated herein by reference.
|
|
|
|
(10ao)*
|
|
Amendment No. 2 to the Key Employee Share Option Plan dated June 10, 2005 (filed as Exhibit 10aw to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 2006), incorporated herein by reference.
|
|
|
|
(10ap)*
|
|
Amendment No. 3 to the Key Employee Share Option Plan dated July 12, 2011 (filed as Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q (File No. 1-15885) for the period ending July 1, 2011), incorporated herein by reference.
|
|
|
|
(10aq)*
|
|
1997 Stock Incentive Plan for Non-employee Directors, (As Amended and Restated as of May 1, 2001) (filed as Appendix B to the Company’s Proxy Statement (File No. 1-15885) dated March 19, 2001), incorporated herein by reference.
|
|
|
|
(10ar)*
|
|
Amendment No. 1 to the 1997 Stock Incentive Plan for Non-employee Directors, (filed as Exhibit 10gg to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 2003), incorporated herein by reference.
|
|
|
|
(10as)*
|
|
Form of Nonqualified Stock Option Agreement for Non-employee Directors (filed as Exhibit 10mm to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 2004), incorporated herein by reference.
|
|
|
|
(10at)*
|
|
1992 Deferred Compensation Plan for Non-employee Directors (As Amended and Restated as of December 2, 1997) (filed as Exhibit 4d to the Registration Statement on Form S-8 (File No. 1-15885), Registration No. 333-63355, filed by Brush Wellman Inc.), incorporated herein by reference.
|
|
|
|
(10au)*
|
|
2000 Reorganization Amendment, dated May 16, 2000, to the 1997 Deferred Compensation Plan for Non-employee Directors (filed as Exhibit 4b to Post-Effective Amendment No. 1 to Registration Statement (File No. 1-15885) No. 333-63353), incorporated herein by reference.
|
|
|
|
(10av)*
|
|
Amendment No. 1 (effective September 11, 2001) to the 1992 Deferred Compensation Plan for Non-employee Directors (filed as Exhibit 4c to the Company’s Post-Effective Amendment No. 1 to Registration Statement (File No. 1-15885) No. 333-74296), incorporated herein by reference.
|
|
|
|
(10aw)*
|
|
Amendment No. 2 (effective September 13, 2004) to the 1992 Deferred Compensation Plan for Non- employee Directors (filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q (File No. 1-15885) for the period ended October 1, 2004), incorporated herein by reference.
|
|
|
|
(10ax)*
|
|
Amendment No. 3 (effective January 1, 2005) to the 1992 Deferred Compensation Plan for Non-employee Directors (filed as Exhibit 10rr to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 2004), incorporated herein by reference.
|
|
|
|
(10ay)*
|
|
Amendment No. 4 (effective April 1, 2009) to the 1992 Deferred Compensation Plan for Non- employee Directors (filed as Exhibit 10bb to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 2008), incorporated herein by reference.
|
|
|
|
(10az)*
|
|
Amended and Restated 2005 Deferred Compensation Plan for Non-employee Directors (filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q (File No. 1-15885) for the period ended September 26, 2008), incorporated herein by reference.
|
|
|
|
(10ba)*
|
|
Amended and Restated Materion Corporation 2006 Non-employee Director Equity Plan (as Amended and Restated as of May 4, 2011) (filed as Appendix B to the Registrant’s Proxy Statement (File No. 1-15885) filed on March 25, 2011), incorporated herein by reference.
|
|
|
|
(10bb)*#
|
|
First Amendment to the 2006 Non-employee Director Equity Plan (as Amended and Restated as of May 4, 2011).
|
|
|
|
(10bc)*
|
|
Amended and Restated Executive Deferred Compensation Plan II (filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q (File No. 1-15885) for the period ended March 28, 2008), incorporated herein by reference.
|
|
|
|
(10bd)*
|
|
Amendment No. 1 to the Amended and Restated Executive Deferred Compensation Plan II (filed as Exhibit 10bf to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 2008), incorporated herein by reference.
|
|
|
|
(10be)*
|
|
Amendment No. 2 to the Amended and Restated Executive Deferred Compensation Plan II (filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q (File No. 1-15885) for the period ended July 3, 2009), incorporated herein by reference.
|
|
|
|
(10bf)*
|
|
Amendment No. 3 to the Amended and Restated Executive Deferred Compensation Plan II, dated July 6, 2011 (filed as Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q (File No. 1-15885) for the period ending July 1, 2011), incorporated herein by reference.
|
|
|
|
(10bg)*
|
|
Trust Agreement between the Company and Fidelity Investments dated September 26, 2006 for certain deferred compensation plans for Non-employee Directors of the Company (filed as Exhibit 99.4 to the Current Report on Form 8-K (File No. 1-15885) filed by the Company on September 29, 2006), incorporated herein by reference.
|
|
|
|
(10bh)*
|
|
Trust Agreement between the Company and Fidelity Management Trust Company, dated June 25, 2009 relating to the Executive Deferred Compensation Plan II (filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q (File No. 1-15885) for the period ended July 3, 2009), incorporated herein by reference.
|
|
|
|
(10bi)
|
|
Trust Agreement between the Company and Fifth Third Bank N.A. dated September 25, 2006 relating to the Key Employee Share Option Plan (filed as Exhibit 99.3 to the Current Report on Form 8-K (File No. 1-15885) filed by the Company on September 29, 2006), incorporated herein by reference.
|
|
|
|
(10bj)
|
|
Lease dated as of October 1, 1996, between Brush Wellman Inc. and Toledo-Lucas County Port Authority (filed as Exhibit 10v to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 1996), incorporated herein by reference.
|
|
|
|
(10bk)
|
|
Amended and Restated Inducement Agreement with the Prudential Insurance Company of America dated May 30, 2003 (filed as Exhibit 10 to the Company’s Quarterly Report on Form 10-Q (File No. 1-15885) for the period ended June 27, 2003), incorporated herein by reference.
|
|
|
|
(10bl)
|
|
Amended and Restated Supply Agreement between RWE Nukem, Inc. and Brush Wellman Inc. for the sale and purchase of beryllium products (filed as Exhibit 10 to the Company’s Quarterly Report on Form 10-Q (File No. 1-15885) for the period ended September 26, 2003), incorporated herein by reference.
|
|
|
|
(10bm)
|
|
Supply Agreement between the Defense Logistics Agency and Brush Wellman Inc. for the sale and purchase of beryllium products (filed as Exhibit 10tt to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 2004), incorporated herein by reference.
|
|
|
|
(10bn)
|
|
Asset Purchase Agreement by and between Williams Advanced Materials Inc. and Techni-Met, Inc. dated December 20, 2007 (filed as Exhibit 10bw to the Company’s Annual Report on Form 10-K (File No. 1-15885) for the year ended December 31, 2007), incorporated herein by reference.
|
|
|
|
(10bo)
|
|
Consignment Agreement dated October 2, 2009 between Brush Engineered Materials Inc. and Canadian Imperial Bank of Commerce and CIBC World Markets Inc. (filed as Exhibit 10.1 to the Company’s Form 8-K (File No. 1-15885) on October 8, 2009), incorporated herein by reference.
|
|
|
|
(10bp)
|
|
Amendment No. 1 to the Consignment Agreement dated October 2, 2009 between Brush Engineered Materials Inc. and Canadian Imperial Bank of Commerce and CIBC World Markets Inc. (filed as Exhibit 99.1 to the Company’s Form 8-K (File No. 1-15885) on March 12, 2010), incorporated herein by reference.
|
|
|
|
(10bq)
|
|
Amendment No. 2 to the Consignment Agreement dated June 11, 2010 between Brush Engineered Materials Inc. and Canadian Imperial Bank of Commerce and CIBC World Markets Inc., (filed as Exhibit 99.1 to the Company’s Form 8-K (File No. 1-15885) filed on June 14, 2010), incorporated herein by reference.
|
|
|
|
(10br)
|
|
Amendment No. 3 to the Consignment Agreement dated September 30, 2010 between Brush Engineered Materials Inc. and Canadian Imperial Bank of Commerce and CIBC World Markets Inc. (filed as Exhibit 10.1 to the Company’s Form 8-K (File No. 1-15885), on October 4, 2010), incorporated herein by reference.
|
|
|
|
(10bs)
|
|
Amendment No. 4 to the Consignment Agreement dated November 10, 2010 between Brush Engineered Materials Inc. and Canadian Imperial Bank of Commerce and CIBC World Markets Inc. (filed as Exhibit 99.1 to the Company’s Form 8-K (File No. 1-15885), on November 12, 2010), incorporated herein by reference.
|
|
|
|
(10bt)
|
|
Amendment No. 5 to the Consignment Agreement dated March 7, 2011 between Brush Engineered Materials Inc. and Canadian Imperial Bank of Commerce and CIBC World Markets Inc. (filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q (File No. 1-15885) for the period ended April 1, 2011), incorporated herein by reference.
|
|
|
|
(10bu)
|
|
Amendment No. 6 to the Consignment Agreement dated September 13, 2011 between Materion Corporation and Canadian Imperial Bank of Commerce and CIBC World Markets Inc. (filed as Exhibit 10.1 to the Company’s Form 8-K (File No. 1-15885) filed on September 16, 2011), incorporated herein by reference.
|
|
|
|
(10bv)
|
|
Amendment No. 7 to the Consignment Agreement dated August 24, 2012 between Materion Corporation and Canadian Imperial Bank of Commerce and CIBC World Markets Inc., (filed as Exhibit 10.1 to the Company's Form 8-K (File No. 1-15885) on August 31, 2012), incorporated herein by reference.
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(21)#
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Subsidiaries of the Registrant.
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(23)#
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Consent of Ernst & Young LLP.
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(24)#
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Power of Attorney.
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(31.1)#
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Certification of Chief Executive Officer required by Rule 13a-14(a) or 15d-14(a).
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(31.2)#
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Certification of Chief Financial Officer required by Rule 13a-14(a) or 15d-14(a).
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(32)#
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Certifications of Chief Executive Officer and Chief Financial Officer required by 18 U.S.C. Section 1350.
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(95)#
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Mine Safety Disclosure Pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act for the Fiscal Year Ended December 31, 2012.
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(101.INS)^
|
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XBRL Instance Document.
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(101.SCH)^
|
|
XBRL Taxonomy Extension Schema Document.
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(101.CAL)^
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XBRL Taxonomy Extension Calculation Linkbase Document.
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(101.DEF)^
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XBRL Taxonomy Extension Definition Linkbase Document.
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(101.LAB)^
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|
XBRL Taxonomy Extension Label Linkbase Document.
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(101.PRE)^
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XBRL Taxonomy Extension Presentation Linkbase Document.
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*
|
Denotes a compensatory plan or arrangement.
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#
|
Filed herewith.
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^
|
XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.
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MATERION CORPORATION
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||||||
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By:
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/s/ RICHARD J. HIPPLE
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By:
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/s/ JOHN D. GRAMPA
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Richard J. Hipple
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John D. Grampa
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Chairman of the Board, President
and Chief Executive Officer
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Senior Vice President Finance
and Chief Financial Officer
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/s/ RICHARD J. HIPPLE
|
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Chairman of the Board, President, Chief Executive Officer and Director (Principal Executive Officer)
|
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March 8, 2013
|
Richard J. Hipple
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||
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/s/ JOHN D. GRAMPA
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Senior Vice President Finance and Chief Financial Officer (Principal Financial and Accounting Officer)
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March 8, 2013
|
John D. Grampa
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||
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/s/ JOSEPH P. KEITHLEY*
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Director
|
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March 8, 2013
|
Joseph P. Keithley*
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/s/ VINOD M. KHILNANI*
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Director
|
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March 8, 2013
|
Vinod M. Khilnani*
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/s/ WILLIAM B. LAWRENCE*
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Director
|
|
March 8, 2013
|
William B. Lawrence*
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/s/ N. MOHAN REDDY*
|
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Director
|
|
March 8, 2013
|
N. Mohan Reddy*
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/s/ WILLIAM R. ROBERTSON*
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Director
|
|
March 8, 2013
|
William R. Robertson*
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/s/ JOHN SHERWIN, JR.*
|
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Director
|
|
March 8, 2013
|
John Sherwin, Jr.*
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|
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/s/ CRAIG S. SHULAR*
|
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Director
|
|
March 8, 2013
|
Craig S. Shular*
|
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/s/ DARLENE J. S. SOLOMON*
|
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Director
|
|
March 8, 2013
|
Darlene J. S. Solomon*
|
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/s/ ROBERT B. TOTH*
|
|
Director
|
|
March 8, 2013
|
Robert B. Toth*
|
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/s/ GEOFFREY WILD*
|
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Director
|
|
March 8, 2013
|
Geoffrey Wild*
|
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*
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The undersigned, by signing his/her name hereto, does sign and execute this report on behalf of each of the above-named officers and directors of Materion Corporation, pursuant to Powers of Attorney executed by each such officer and director filed with the Securities and Exchange Commission.
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By:
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/s/ JOHN D. GRAMPA
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John D. Grampa
|
March 8, 2013
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Attorney-in-Fact
|
COL. A
|
|
COL. B
|
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COL. C
|
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COL. D
|
|
COL. E
|
||||||||||||
(Thousands)
|
|
Balance at Beginning of Period
|
|
ADDITIONS
|
|
Deduction-
Describe
|
|
Balance at End
of Period
|
||||||||||||
|
(1)
Charged to Costs
and Expenses
|
|
(2)
Charged to Other
Accounts-Describe
|
|
||||||||||||||||
Year ended December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deducted from asset accounts:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts receivable
|
|
$
|
1,490
|
|
|
$
|
560
|
|
|
$
|
(305
|
)
|
|
$
|
342
|
|
(B)
|
$
|
1,403
|
|
Inventory reserves and obsolescence
|
|
5,005
|
|
|
2,836
|
|
|
—
|
|
|
3,024
|
|
(C)
|
4,817
|
|
|||||
Year ended December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deducted from asset accounts:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts receivable
|
|
1,452
|
|
|
285
|
|
|
—
|
|
|
247
|
|
(B)
|
1,490
|
|
|||||
Inventory reserves and obsolescence
|
|
4,609
|
|
|
878
|
|
|
—
|
|
|
482
|
|
(C)
|
5,005
|
|
|||||
Year ended December 31, 2010
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deducted from asset accounts:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts receivable
|
|
1,397
|
|
|
423
|
|
|
315
|
|
(A)
|
683
|
|
(B)
|
1,452
|
|
|||||
Inventory reserves and obsolescence
|
|
4,228
|
|
|
3,309
|
|
|
46
|
|
(A)
|
2,974
|
|
(C)
|
4,609
|
|
IV.
|
PLAN AWARD OPPORTUNITY
FOR FINANCIAL PERFORMANCE COMPONENT
|
(A)
|
a Change in Control (as defined in Section 2(g) of this Article II) shall occur after the Date of Grant; and
|
(B)
|
within two years following the Change in Control the Grantee’s employment with the Corporation or a Subsidiary is terminated by the Grantee as a Termination for Good Cause (as defined in Section 2(f) of his Article II)
or
the Grantee is terminated by the Corporation other than as a Termination for Cause (as defined in Section 2(e) of this Article II). If the Change in Control constitutes a “change in control” for purposes of Section 409A of the Code and if the Grantee incurs a “separation from service” for purposes of Section 409A of the Code within two years following such Change in Control, payment for any RSUs which are no longer subject to a substantial risk of forfeiture will be made upon the Grantee’s separation from service,
provided
however
, that if at such time the Grantee is a “specified employee” as determined pursuant to the identification methodology adopted by the Corporation in compliance with Section 409A of the Code, the
|
(A)
|
a Change in Control shall occur after the Date of Grant; and
|
(B)
|
within two years following the Change in Control the Grantee’s employment with the Corporation or a Subsidiary is terminated by the Grantee as a Termination for Good Cause (as defined in Section 2(f) of this Article)
or
the Grantee is terminated by the Corporation other than as a Termination for Cause (as defined in Section 2(e) of this Article II). If the Change in Control constitutes a “change in control” for purposes of Section 409A of the Code and if the Grantee incurs a “separation from service” for purposes of Section 409A of the Code within two years following such Change in Control, payment for any RSUs which are no longer subject to a substantial risk of forfeiture will be made upon the Grantee’s separation from service,
provided
however
, that if at such time the Grantee is a “specified employee” as determined pursuant to the identification methodology adopted by the Corporation in compliance with Section 409A of the Code, the date of payment for the RSUs shall be the first business day of the
|
A.
|
Competitive Activity During Employment
. Competing with the Corporation anywhere within the United States during the term of the Grantee’s employment, including, without limitation:
|
(1)
|
entering into or engaging in any business which competes with the business of the Corporation;
|
(2)
|
soliciting customers, business, patronage or orders for, or selling, any products or services in competition with, or for any business that competes with, the business of the Corporation;
|
(3)
|
diverting, enticing or otherwise taking away any customers, business, patronage or orders of the Corporation or attempting to do so; or
|
(4)
|
promoting or assisting, financially or otherwise, any person, firm, association, partnership, corporation or other entity engaged in any business which competes with the business of the Corporation.
|
B.
|
Following Termination
. For a period of one year following the Grantee’s termination date:
|
(1)
|
entering into or engaging in any business which competes with the Corporation’s business within the Restricted Territory (as hereinafter defined);
|
(2)
|
soliciting customers, business, patronage or orders for, or selling, any products or services in competition with, or for any business, wherever located, that competes with, the Corporation’s business within the Restricted Territory;
|
(3)
|
diverting, enticing or otherwise taking away any customers, business, patronage or orders of the Corporation within the Restricted Territory, or attempting to do so; or
|
(4)
|
promoting or assisting, financially or otherwise, any person, firm, association, partnership, corporation or other entity engaged in any business which competes with the Corporation’s business within the Restricted Territory.
|
C.
|
The “Corporation
.” For the purposes of this Section 10(a)(ii) of Article II, the “Corporation” shall include any and all direct and indirect subsidiaries, parents, and affiliated, or related companies of the Corporation for which the Grantee worked or had responsibility at the time of termination of the Grantee’s employment and at any time during the two-year period prior to such termination.
|
D.
|
The “Corporation’s Business
.” For the purposes of this Section 10 of Article II inclusive, the Corporation’s business is defined to be the manufacture, marketing and sale of high performance engineered materials serving the consumer electronics, industrial components and commercial aerospace, defense and science, medical, energy, automotive electronics, telecommunications infrastructure and appliance markets as further described in any and all manufacturing, marketing and sales manuals and materials of the Corporation as the same may be altered,
|
E.
|
“
Restricted Territory
.” For the purposes of Section 10(a)(ii)(B) of Article II, the “Restricted Territory” shall be defined as and limited to:
|
(5)
|
the geographic area(s) within a one hundred mile radius of any and all Corporation location(s) in, to, or for which the Grantee worked, to which the Grantee was assigned or had any responsibility (either direct or supervisory) at the time of termination of the Grantee’s employment and at any time during the two-year period prior to such termination; and
|
(6)
|
all of the specific customer accounts, whether within or outside of the geographic area described in (1) above, with which the Grantee had any contact or for which the Grantee had any responsibility (either direct or supervisory) at the time of termination of the Grantee’s employment and at any time during the two-year period prior to such termination.
|
F.
|
“
Extension
.” If it shall be judicially determined that the Grantee has violated any of the Grantee’s obligations under Section 10(a)(ii)(B) of Article II of this Agreement, then the period applicable to each obligation that the Grantee shall have been determined to have violated shall automatically be extended by a period of time equal in length to the period during which such violation(s) occurred.
|
Section 1.
|
Definitions
. For purposes hereof:
|
(a)
|
“
Peer Group
” means, of a benchmark group of 20 entities, the names of which are attached hereto as
Annex A
, those entities that remain in the Peer Group as of the end of the Performance Period after application of the Peer Group Adjustment Protocol.
|
(b)
|
“
Peer Group Adjustment Protocol
” means: (i) if an entity listed in
Annex A
files for bankruptcy and/or liquidation, is operating under bankruptcy protection, or is delisted from its primary stock exchange because it fails to meet the exchange listing requirement, then such entity will not remain in the Peer Group and RTSR for the Performance Period will be calculated as if such entity had never been a member of the Peer Group; (ii) if, as of the last date of the Performance Period, an entity listed in
Annex A
no longer exists as a business entity for any reason other than under subsection (iii) below, then such entity will not remain in the Peer Group and RTSR for the Performance Period will be calculated as if such entity had never been a member of the Peer Group; and (iii) for purposes of this Statement of Management Objectives, for each of the entities listed in
Annex A
, such entity shall be deemed to include any successor to all or substantially all of the primary business of such entity, whether or not the same legal entity, at end of the Performance Period.
|
(c)
|
“
Relative Total Shareholder Return
” or “
RTSR
” means the percentile rank of the Corporation’s Total Shareholder Return among the Total Shareholder Returns of all members of the Peer Group, ranked in descending order, at the end of the Performance Period. Percentile will be calculated using the Microsoft Excel Percentile Function method.
|
(d)
|
“
Return on Invested Capital
” or “
ROIC
” means the Corporation’s 2015 annual operating profit before tax divided by the sum of averages of monthly short-term debt, long-term debt and equity for 2015, with the term “equity” excluding the items within other comprehensive income (namely, pension valuation adjustment, derivative valuation adjustment and the cumulative translation adjustment). The monthly averages described in the immediately preceding sentence will be computed using the values from December 31, 2014 and each month in 2015.
|
(e)
|
“
Total Shareholder Return
” means, with respect to each of the Common Shares and the common stock of each of the members of the Peer Group, a rate of return
|
Section 2.
|
Performance Matrices
.
|
Section 3.
|
Number of PRSUs Earned
. Following the Performance Period, on the Committee Determination Date, the Committee shall determine whether and to what extent the goals relating to the Management Objectives have been satisfied for the Performance Period and shall determine the number of PRSUs that shall become nonforfeitable hereunder and under the Agreement on the basis of the following:
|
(a)
|
Below Threshold
. If, upon the conclusion of the Performance Period, (i) ROIC for the Performance Period falls below the threshold level, as set forth in the Performance Matrices, no ROIC PRSUs shall become nonforfeitable and (ii) RTSR for the Performance Period falls below the threshold level, as set forth in the Performance Matrices, no RTSR PRSUs shall become nonforfeitable.
|
(b)
|
Threshold
. If, upon the conclusion of the Performance Period, (i) ROIC for the Performance Period equals the threshold level, as set forth in the Performance Matrices, 25% of the ROIC PRSUs (rounded down to the nearest whole number of ROIC PRSUs) shall become nonforfeitable, and (ii) RTSR for the Performance Period equals the threshold level, as set forth in the Performance Matrices, 50% of the RTSR PRSUs (rounded down to the nearest whole number of RTSR PRSUs) shall become nonforfeitable.
|
(c)
|
Between Threshold and Target
. If, upon the conclusion of the Performance Period, (i) ROIC for the Performance Period exceeds the threshold level, but is less than the target level, as set forth in the Performance Matrices, a percentage between 25% and 100% (determined on the basis of straight-line mathematical interpolation) of the ROIC PRSUs (rounded down to the nearest whole number of ROIC PRSUs) shall become nonforfeitable, and (ii) RTSR for the Performance Period exceeds the threshold level, but is less than the target level, as set forth in the Performance Matrices, a percentage between 50% and 100% (determined on the basis of straight-line mathematical interpolation) of the RTSR PRSUs (rounded down to the nearest whole number of RTSR PRSUs) shall become nonforfeitable.
|
(d)
|
Target
. If, upon the conclusion of the Performance Period, (i) ROIC for the Performance Period equals the target level, as set forth in the Performance Matrices, 100% of the ROIC PRSUs shall become nonforfeitable, and (ii) RTSR for the Performance Period equals the target level, as set forth in the Performance Matrices, 100% of the RTSR PRSUs shall become nonforfeitable.
|
(e)
|
Between Target and Maximum
. If, upon the conclusion of the Performance Period, (i) ROIC for the Performance Period exceeds the target level, but is less than the maximum level, as set forth in the Performance Matrices, a percentage between 100% and 200% (determined on the basis of straight-line mathematical interpolation) of the ROIC PRSUs (rounded down to the nearest whole number of ROIC PRSUs) shall become nonforfeitable, and (ii) RTSR for the Performance Period exceeds the target level, but is less than the maximum level, as set forth in the Performance Matrices, a percentage between 100% and 200% (determined on the basis of straight-line mathematical interpolation) of the RTSR PRSUs (rounded down to the nearest whole number of RTSR PRSUs) shall become nonforfeitable.
|
(f)
|
Equals or Exceeds Maximum
. If, upon the conclusion of the Performance Period, (i) ROIC for the Performance Period equals or exceeds the maximum level, as set forth in the Performance Matrices, 200% of the ROIC PRSUs shall become nonforfeitable, and (ii) RTSR for the Performance Period equals or exceeds the maximum level, as set forth in the Performance Matrices, 200% of the RTSR PRSUs shall become nonforfeitable.
|
Company Name
|
Ticker Symbol
|
II-VI Incorporated
|
IIVI
|
Atmel Corporation
|
ATML
|
Cabot Corporation
|
CBT
|
Castle, A. M.
|
Castle
|
Coherent Inc.
|
COHR
|
CTS Corporation
|
CTS
|
Entegris Incorporated
|
ENTG
|
Ferro Corporation
|
FOE
|
Haynes International Inc.
|
HAYN
|
Integrated Device Tech Inc.
|
IDTI
|
Kemet Corporation
|
KEM
|
Kraton Performance Polymers Inc.
|
KRA
|
Minerals Technologies Inc.
|
MTX
|
OM Group Inc.
|
OMG
|
PolyOne Corporation
|
POL
|
Quaker Chemical Corporation
|
KWR
|
RF Micro Devices Inc.
|
RFMD
|
Rogers Corporation
|
ROG
|
RTI International Metals Inc.
|
RTI
|
Skyworks Solutions Inc.
|
SWKS
|
A.
|
Competitive Activity During Employment
. Competing with the Corporation anywhere within the United States during the term of the Grantee’s employment, including, without limitation:
|
(1)
|
entering into or engaging in any business which competes with the business of the Corporation;
|
(2)
|
soliciting customers, business, patronage or orders for, or selling, any products or services in competition with, or for any business that competes with, the business of the Corporation;
|
(3)
|
diverting, enticing or otherwise taking away any customers, business, patronage or orders of the Corporation or attempting to do so; or
|
(4)
|
promoting or assisting, financially or otherwise, any person, firm, association, partnership, corporation or other entity engaged in any business which competes with the business of the Corporation.
|
B.
|
Following Termination
. For a period of one year following the Grantee’s termination date:
|
(1)
|
entering into or engaging in any business which competes with the Corporation’s business within the Restricted Territory (as hereinafter defined);
|
(2)
|
soliciting customers, business, patronage or orders for, or selling, any products or services in competition with, or for any business, wherever located, that competes with, the Corporation’s business within the Restricted Territory;
|
(3)
|
diverting, enticing or otherwise taking away any customers, business, patronage or orders of the Corporation within the Restricted Territory, or attempting to do so; or
|
(4)
|
promoting or assisting, financially or otherwise, any person, firm, association, partnership, corporation or other entity engaged in any business which competes with the Corporation’s business within the Restricted Territory.
|
C.
|
The “Corporation
.” For the purposes of this Section 10(a)(ii) of Article II, the “Corporation” shall include any and all direct and indirect subsidiaries, parents, and affiliated, or related companies of the Corporation for which
|
D.
|
The “Corporation’s Business
.” For the purposes of this Section 10 of Article II inclusive, the Corporation’s business is defined to be the manufacture, marketing and sale of high performance engineered materials serving the
consumer electronics, industrial components and commercial aerospace, defense and science, medical, energy, automotive electronics, telecommunications infrastructure and appliance
markets as further described in any and all manufacturing, marketing and sales manuals and materials of the Corporation as the same may be altered, amended, supplemented or otherwise changed from time to time, or of any other products or services substantially similar to or readily substitutable for any such described products and services.
|
E.
|
“
Restricted Territory
.” For the purposes of Section 10(a)(ii)(B) of Article II, the “Restricted Territory” shall be defined as and limited to:
|
(1)
|
the geographic area(s) within a one hundred mile radius of any and all Corporation location(s) in, to, or for which the Grantee worked, to which the Grantee was assigned or had any responsibility (either direct or supervisory) at the time of termination of the Grantee’s employment and at any time during the two-year period prior to such termination; and
|
(2)
|
all of the specific customer accounts, whether within or outside of the geographic area described in (1) above, with which the Grantee had any contact or for which the Grantee had any responsibility (either direct or supervisory) at the time of termination of the Grantee’s employment and at any time during the two-year period prior to such termination.
|
F.
|
“
Extension
.” If it shall be judicially determined that the Grantee has violated any of the Grantee’s obligations under Section 10(a)(ii)(B) of Article II of this Agreement, then the period applicable to each obligation that the Grantee shall have been determined to have violated shall automatically be extended by a period of time equal in length to the period during which such violation(s) occurred.
|
Section 1.
|
Definitions
. For purposes hereof:
|
(a)
|
“
Peer Group
” means, of a benchmark group of 20 entities, the names of which are attached hereto as
Annex A
, those entities that remain in the Peer Group as of the end of the Performance Period after application of the Peer Group Adjustment Protocol.
|
(b)
|
“
Peer Group Adjustment Protocol
” means: (i) if an entity listed in
Annex A
files for bankruptcy and/or liquidation, is operating under bankruptcy protection, or is delisted from its primary stock exchange because it fails to meet the exchange listing requirement, then such entity will not remain in the Peer Group and RTSR for the Performance Period will be calculated as if such entity had never been a member of the Peer Group; (ii) if, as of the last date of the Performance Period, an entity listed in
Annex A
no longer exists as a business entity for any reason other than under subsection (iii) below, then such entity will not remain in the Peer Group and RTSR for the Performance Period will be calculated as if such entity had never been a member of the Peer Group; and (iii) for purposes of this Statement of Management Objectives, for each of the entities listed in
Annex A
, such entity shall be deemed to include any successor to all or substantially all of the primary business of such entity, whether or not the same legal entity, at end of the Performance Period.
|
(c)
|
“
Relative Total Shareholder Return
” or “
RTSR
” means the percentile rank of the Corporation’s Total Shareholder Return among the Total Shareholder Returns of all members of the Peer Group, ranked in descending order, at the end of the Performance Period. Percentile will be calculated using the Microsoft Excel Percentile Function method.
|
(d)
|
“
Return on Invested Capital
” or “
ROIC
” means the Corporation’s 2015 annual operating profit before tax divided by the sum of averages of monthly short-term debt, long-term debt and equity for 2015, with the term “equity” excluding the items within other comprehensive income (namely, pension valuation adjustment, derivative valuation adjustment and the cumulative translation adjustment). The monthly averages described in the immediately preceding sentence will be computed using the values from December 31, 2014 and each month in 2015.
|
(e)
|
“
Total Shareholder Return
” means, with respect to each of the Common Shares and the common stock of each of the members of the Peer Group, a rate of return
|
Section 2.
|
Performance Matrices
.
|
Section 3.
|
Number of PRSUs Earned
. Following the Performance Period, on the Committee Determination Date, the Committee shall determine whether and to what extent the goals relating to the Management Objectives have been satisfied for the Performance Period and shall determine the number of PRSUs that shall become nonforfeitable hereunder and under the Agreement on the basis of the following:
|
(a)
|
Below Threshold
. If, upon the conclusion of the Performance Period, (i) ROIC for the Performance Period falls below the threshold level, as set forth in the Performance Matrices, no ROIC PRSUs shall become nonforfeitable and (ii) RTSR for the Performance Period falls below the threshold level, as set forth in the Performance Matrices, no RTSR PRSUs shall become nonforfeitable.
|
(b)
|
Threshold
. If, upon the conclusion of the Performance Period, (i) ROIC for the Performance Period equals the threshold level, as set forth in the Performance Matrices, 25% of the ROIC PRSUs (rounded down to the nearest whole number of ROIC PRSUs) shall become nonforfeitable, and (ii) RTSR for the Performance Period equals the threshold level, as set forth in the Performance Matrices, 50% of the RTSR PRSUs (rounded down to the nearest whole number of RTSR PRSUs) shall become nonforfeitable.
|
(c)
|
Between Threshold and Target
. If, upon the conclusion of the Performance Period, (i) ROIC for the Performance Period exceeds the threshold level, but is less than the target level, as set forth in the Performance Matrices, a percentage between 25% and 100% (determined on the basis of straight-line mathematical interpolation) of the ROIC PRSUs (rounded down to the nearest whole number of ROIC PRSUs) shall become nonforfeitable, and (ii) RTSR for the Performance Period exceeds the threshold level, but is less than the target level, as set forth in the Performance Matrices, a percentage between 50% and 100% (determined on the basis of straight-line mathematical interpolation) of the RTSR PRSUs (rounded down to the nearest whole number of RTSR PRSUs) shall become nonforfeitable.
|
(d)
|
Target
. If, upon the conclusion of the Performance Period, (i) ROIC for the Performance Period equals the target level, as set forth in the Performance Matrices, 100% of the ROIC PRSUs shall become nonforfeitable, and (ii) RTSR for the Performance Period equals the target level, as set forth in the Performance Matrices, 100% of the RTSR PRSUs shall become nonforfeitable.
|
(e)
|
Between Target and Maximum
. If, upon the conclusion of the Performance Period, (i) ROIC for the Performance Period exceeds the target level, but is less than the maximum level, as set forth in the Performance Matrices, a percentage between 100% and 200% (determined on the basis of straight-line mathematical interpolation) of the ROIC PRSUs (rounded down to the nearest whole number of ROIC PRSUs) shall become nonforfeitable, and (ii) RTSR for the Performance Period exceeds the target level, but is less than the maximum level, as set forth in the Performance Matrices, a percentage between 100% and 200% (determined on the basis of straight-line mathematical interpolation) of the RTSR PRSUs (rounded down to the nearest whole number of RTSR PRSUs) shall become nonforfeitable.
|
(f)
|
Equals or Exceeds Maximum
. If, upon the conclusion of the Performance Period, (i) ROIC for the Performance Period equals or exceeds the maximum level, as set forth in the Performance Matrices, 200% of the ROIC PRSUs shall become nonforfeitable, and (ii) RTSR for the Performance Period equals or exceeds the maximum level, as set forth in the Performance Matrices, 200% of the RTSR PRSUs shall become nonforfeitable.
|
Company Name
|
Ticker Symbol
|
II-VI Incorporated
|
IIVI
|
Atmel Corporation
|
ATML
|
Cabot Corporation
|
CBT
|
Castle, A. M.
|
Castle
|
Coherent Inc.
|
COHR
|
CTS Corporation
|
CTS
|
Entegris Incorporated
|
ENTG
|
Ferro Corporation
|
FOE
|
Haynes International Inc.
|
HAYN
|
Integrated Device Tech Inc.
|
IDTI
|
Kemet Corporation
|
KEM
|
Kraton Performance Polymers Inc.
|
KRA
|
Minerals Technologies Inc.
|
MTX
|
OM Group Inc.
|
OMG
|
PolyOne Corporation
|
POL
|
Quaker Chemical Corporation
|
KWR
|
RF Micro Devices Inc.
|
RFMD
|
Rogers Corporation
|
ROG
|
RTI International Metals Inc.
|
RTI
|
Skyworks Solutions Inc.
|
SWKS
|
Participant
|
Offset Amount
|
Special Calculation Provisions
|
||
|
|
|
||
Michael D. Anderson
|
|
$246,250
|
|
|
Gregory R. Chemnitz
|
|
$0
|
|
|
Stephen Freeman
|
|
$496,308
|
|
|
John D. Grampa
|
|
$530,000
|
|
|
Michael C. Hasychak
|
|
$212,989
|
|
|
Richard J. Hipple
|
|
$842,250
|
|
In addition to the Prevented Benefit determined for Mr. Hipple pursuant to Section 2(j), an additional amount shall be included in the amount payable to him under Section 4, determined as follows:
•
Mr. Hipple's Prevented Benefit shall be determined pursuant to Section 2(j).
•
Such amount shall be divided by his number of Years of Benefit Service under the Pension Plan.
•
The resulting amount shall be multiplied by 5.
|
Donald G. Klimkowicz
|
|
$140,418
|
|
|
Alfonso T. Lubrano
|
|
$358,926
|
|
|
Walter G. Maxwell
|
|
$86,165
|
|
|
Richard W. Sager
|
|
$291,735
|
|
|
Daniel A. Skoch
|
|
$943,121
|
|
|
(1)
|
Registration Statement Number 333-88994 on Form S-8 dated May 24, 2002;
|
(2)
|
Post-Effective Amendment Number 1 to Registration Statement Number 333-74296 on Form S-8 dated November 30, 2001;
|
(3)
|
Post-Effective Amendment Number 5 to Registration Statement Number 2-64080 on Form S-8 dated May 17, 2000;
|
(4)
|
Post-Effective Amendment Number 1 to Registration Statement Number 333-63355 on Form S-8 dated May 17, 2000;
|
(5)
|
Post-Effective Amendment Number 1 to Registration Statement Number 33-28605 on Form S-8 dated May 17, 2000;
|
(6)
|
Post-Effective Amendment Number 1 to Registration Statement Number 333-63353 on Form S-8 dated May 17, 2000;
|
(7)
|
Post-Effective Amendment Number 1 to Registration Statement Number 333-63357 on Form S-8 dated May 17, 2000;
|
(8)
|
Post-Effective Amendment Number 1 to Registration Statement Number 333-52141 on Form S-8 dated May 17, 2000;
|
(9)
|
Post-Effective Amendment Number 1 to Registration Statement Number 2-90724 on Form S-8 dated May 17, 2000;
|
(10)
|
Registration Statement Number 333-63353 on Form S-8 dated September 14, 1998;
|
(11)
|
Registration Statement Number 333-63355 on Form S-8 dated September 14, 1998;
|
(12)
|
Registration Statement Number 333-63357 on Form S-8 dated September 14, 1998;
|
(13)
|
Registration Statement Number 333-52141 on Form S-8 dated May 5, 1998;
|
(14)
|
Registration Statement Number 33-28605 on Form S-8 dated May 5, 1989;
|
(15)
|
Registration Statement Number 2-90724 on Form S-8 dated April 27, 1984;
|
(16)
|
Post-Effective Amendment Number 3 to Registration Statement Number 2-64080 on Form S-8 dated April 22, 1983;
|
(17)
|
Registration Statement Number 333-114147 on Form S-3 dated July 1, 2004;
|
(18)
|
Registration Statement Number 333-127130 on Form S-8 dated August 3, 2005;
|
(19)
|
Registration Statement Number 333-133428 on Form S-8 dated April 20, 2006;
|
(20)
|
Registration Statement Number 333-133429 on Form S-8 dated April 20, 2006;
|
(21)
|
Registration Statement Number 333-145149 on Form S-8 dated August 6, 2007;
|
(22)
|
Registration Statement Number 333-173915 on Form S-8 dated May 4, 2011;
|
(23)
|
Registration Statement Number 333-173916 on Form S-8 dated May 4, 2011;
|
(24)
|
Registration Statement Number 333-173917 on Form S-8 dated May 4, 2011; and
|
(25)
|
Registration Statement Number 333-184723 on Form S-3 dated November 2, 2012
|
/s/ RICHARD J. HIPPLE
|
|
/s/ WILLIAM R. ROBERTSON
|
Richard J. Hipple, Chairman of the Board, President,
|
|
William R. Robertson, Director
|
Chief Executive Officer and Director
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
/s/ JOHN D. GRAMPA
|
|
/s/ JOHN SHERWIN, JR.
|
John D. Grampa, Senior Vice President
|
|
John Sherwin, Jr., Director
|
Finance and Chief Financial Officer
|
|
|
(Principal Financial and Accounting Officer)
|
|
|
|
|
|
/s/ JOSEPH P. KEITHLEY
|
|
/s/ CRAIG S. SHULAR
|
Joseph P. Keithley, Director
|
|
Craig S. Shular, Director
|
|
|
|
/s/ VINOD M. KHILNANI
|
|
/s/ DARLENE J. S. SOLOMON
|
Vinod M. Khilnani, Director
|
|
Darlene J. S. Solomon, Director
|
|
|
|
/s/ WILLIAM B. LAWRENCE
|
|
/s/ ROBERT B. TOTH
|
William B. Lawrence, Director
|
|
Robert B. Toth, Director
|
|
|
|
/s/ N. MOHAN REDDY
|
|
/s/ GEOFFREY WILD
|
N. Mohan Reddy, Director
|
|
Geoffrey Wild, Director
|
1)
|
I have reviewed this annual report on Form 10-K of Materion Corporation (the “registrant”);
|
2)
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3)
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4)
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5)
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
|
|
|
/s/ Richard J. Hipple
|
Dated: March 8, 2013
|
|
Richard J. Hipple
|
|
|
Chairman, President and
|
|
|
Chief Executive Officer
|
1)
|
I have reviewed this annual report on Form 10-K of Materion Corporation (the “registrant”);
|
2)
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3)
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4)
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5)
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
|
Dated: March 8, 2013
|
|
/s/ John D. Grampa
|
|
|
John D. Grampa
|
|
|
Senior Vice President Finance and
Chief Financial Officer
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)), and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.
|
/s/ Richard J. Hipple
|
Richard J. Hipple
|
Chairman of the Board, President and
|
Chief Executive Officer
|
|
/s/ John D. Grampa
|
John D. Grampa
|
Senior Vice President Finance and
|
Chief Financial Officer
|
(A)
|
Total number of alleged violations of mandatory health or safety standards that could significantly and substantially contribute to the cause and effect of a mine safety or health hazard under Section 104 of the Mine Act for which Materion Natural Resources Inc. received a citation from MSHA
|
0
|
(B)
|
Total number of orders issued under Section 104(b) of the Mine Act
|
0
|
(C)
|
Total number of citations and orders for alleged unwarrantable failure by Materion Natural Resources Inc. to comply with mandatory health or safety standards under Section 104(d) of the Mine Act
|
0
|
(D)
|
Total number of alleged flagrant violations under Section 110(b)(2) of the Mine Act
|
0
|
(E)
|
Total number of imminent danger orders issued under Section 107(a) of the Mine Act
|
0
|
(F)
|
Total dollar value of proposed assessments from MSHA under the Mine Act
|
$0
|
(G)
|
Total number of mining-related fatalities
|
0
|
(H)
|
Received notice from MSHA of a pattern of violations under Section 104(e) of the Mine Act
|
No
|
(I)
|
Received notice from MSHA of the potential to have a pattern of violations under Section 104(e) of the Mine Act
|
No
|
(J)
|
Total number of Legal Actions pending as of the last day of the Reporting Period
|
0
|
(K)
|
Total number of Legal Actions instituted during the Reporting Period
|
0
|
(L)
|
Total number of Legal Actions resolved during the Reporting Period
|
0
|