-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, meZxmgPD9uQl7mvtKUsX4aTRAhOYE0KDlqUfbO8S9dkUK5iikQJqTx0TL6/SvqVS Sue6fACk4lNRC49D/tc5Nw== 0000017843-95-000006.txt : 19950515 0000017843-95-000006.hdr.sgml : 19950515 ACCESSION NUMBER: 0000017843-95-000006 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 19941231 FILED AS OF DATE: 19950209 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CARPENTER TECHNOLOGY CORP CENTRAL INDEX KEY: 0000017843 STANDARD INDUSTRIAL CLASSIFICATION: STEEL WORKS, BLAST FURNACES ROLLING MILLS (COKE OVENS) [3312] IRS NUMBER: 230458500 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-05828 FILM NUMBER: 95507178 BUSINESS ADDRESS: STREET 1: 101 W BERN ST CITY: READING STATE: PA ZIP: 19612 BUSINESS PHONE: 2152082000 MAIL ADDRESS: STREET 1: P O BOX 14662 CITY: READING STATE: PA ZIP: 19612-4662 10-Q 1 DEC 31, 1994 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 31, 1994 Commission File Number 1-5828 CARPENTER TECHNOLOGY CORPORATION (Exact name of Registrant as specified in its Charter) Delaware 23-0458500 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 101 West Bern Street, Reading, Pennsylvania 19612-4662 (Address of principal executive offices) (Zip Code) 610-208-2000 (Registrant's telephone number, including area code) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No --- --- Indicate the number of shares outstanding of each of the issuer's classes of common stock as of December 31, 1994. Common stock, $5 par value 8,104,110 Class Number of shares outstanding The Exhibit Index appears on page E-1. CARPENTER TECHNOLOGY CORPORATION FORM 10-Q INDEX Page ---- Part I FINANCIAL INFORMATION Consolidated Balance Sheet December 31, 1994 (Unaudited) and June 30, 1994..................................... 3 & 4 Consolidated Statement of Income (Unaudited) for the Three and Six Months Ended December 31, 1994 and 1993. 5 Consolidated Statement of Cash Flows (Unaudited) for the Six Months Ended December 31, 1994 and 1993........... 6 Notes to Consolidated Financial Statements.............. 7 - 9 Management's Discussion and Analysis of Results of Operations......................................... 9 & 10 Part II OTHER INFORMATION................................11 - 13 Exhibit Index............................................. E-1 PART I ------ CARPENTER TECHNOLOGY CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (Page 1 of 2) December 31, 1994 and June 30, 1994 (in thousands, except share data) December 31 June 30 1994 1994 ----------- --------- ASSETS (Unaudited) - ------ Current assets: Cash and cash equivalents $ 5,491 $ 5,404 Accounts receivable, net 91,603 95,412 Inventories 85,996 65,262 Deferred income taxes 284 463 Other current assets 9,810 4,629 -------- -------- Total current assets 193,184 171,170 -------- -------- Property, plant and equipment, at cost 747,064 723,720 Less accumulated depreciation and amortization 345,774 331,880 -------- -------- 401,290 391,840 -------- -------- Prepaid pension cost 77,112 73,185 -------- -------- Investment in joint venture 50,611 48,576 -------- -------- Other assets 55,690 45,140 -------- -------- Total assets $777,887 $729,911 ======== ======== See accompanying notes to consolidated financial statements. CARPENTER TECHNOLOGY CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (Page 2 of 2) December 31, 1994 and June 30, 1994 (in thousands, except share data) December 31 June 30 LIABILITIES 1994 1994 - ----------- ----------- -------- Current liabilities: (Unaudited) Short-term debt $ 31,265 $ - Accounts payable 46,816 35,478 Accrued compensation 12,856 18,654 Accrued income taxes 3,579 616 Other accrued liabilities 31,926 28,153 Current portion of long-term debt 7,207 15,618 -------- -------- Total current liabilities 133,649 98,519 -------- -------- Long-term debt, net of current portion 167,505 158,070 -------- -------- Accrued postretirement benefits 140,670 139,365 -------- -------- Deferred income taxes 75,696 74,739 -------- -------- Other liabilities and deferred income 18,642 20,074 -------- -------- SHAREHOLDERS' EQUITY - -------------------- Preferred stock, $5 par value - authorized 2,000,000 shares; issued 458.8 shares at December 31, 1994 and 459.9 shares at June 30, 1994 28,965 29,029 Common stock, $5 par value - authorized 50,000,000 shares; issued 9,626,989 shares at December 31, 1994 and 9,612,181 shares at June 30, 1994 48,135 48,061 Capital in excess of par value 52,557 50,882 Reinvested earnings 208,874 204,667 Common stock in treasury, at cost - 1,522,879 shares at December 31, 1994 and 1,522,604 shares at June 30, 1994 (66,989) (66,150) Deferred compensation (25,172) (26,386) Foreign currency translation adjustments (4,645) (959) -------- -------- Total shareholders' equity 241,725 239,144 Total liabilities and -------- -------- shareholders' equity $777,887 $729,911 ======== ======== See accompanying notes to consolidated financial statements. CARPENTER TECHNOLOGY CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENT OF INCOME (Unaudited) for the three and six months ended December 31, 1994 and 1993 (in thousands, except per share data) Three Months Six Months ------------------ ------------------ 1994 1993 1994 1993 ---- ---- ---- ---- Net sales $172,400 $147,127 $328,484 $276,556 -------- -------- -------- -------- Costs and expenses: Cost of sales 127,917 108,264 249,485 205,769 Selling and administrative expenses 25,239 22,825 49,193 43,487 Interest expense 3,064 4,178 5,762 9,214 Equity in loss of joint venture 860 240 1,100 120 Other income, net (274) (517) (785) (922) -------- -------- -------- -------- 156,806 134,990 304,755 257,668 Income before income taxes 15,594 12,137 23,729 18,888 Income taxes 5,767 4,777 8,970 8,756 -------- -------- -------- -------- Net income $ 9,827 $ 7,360 $ 14,759 $ 10,132 ======== ======== ======== ======== Earnings per common share: Primary $ 1.16 $ .86 $ 1.71 $ 1.16 ======== ======== ======== ======== Fully diluted $ 1.11 $ .84 $ 1.66 $ 1.14 ======== ======== ======== ======== Weighted average common shares outstanding 8,161 8,032 8,182 8,019 ======== ======== ======== ======== Dividends per common share $ .60 $ .60 $ 1.20 $ 1.20 ======== ======== ======== ======== See accompanying notes to consolidated financial statements. CARPENTER TECHNOLOGY CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) for the six months ended December 31, 1994 and 1993 (in thousands) 1994 1993 OPERATIONS ---- ---- Net income $ 14,759 $ 10,132 Adjustments to reconcile net income to net cash provided from operations: Depreciation and amortization 15,170 14,374 Deferred income taxes 1,922 2,714 Prepaid pension cost (3,927) (6,147) Equity in loss of joint venture 1,100 120 Changes in working capital and other: Receivables 6,163 18,960 Inventories (22,732) 2,040 Other, net 6,331 18,309 -------- -------- Net cash provided from operations 18,786 60,502 INVESTING ACTIVITIES -------- -------- Purchases of plant and equipment (19,948) (15,179) Disposals of plant and equipment 600 691 Investment in joint venture (2,060) (47,072) Acquisition of wholly-owned subsidiaries, net of cash received (13,055) (22,200) -------- -------- Net cash used for investing activities (34,463) (83,760) FINANCING ACTIVITIES -------- -------- Proceeds from issuance of short-term debt 31,265 8,794 Proceeds from issuance of long-term debt 50,000 - Payments on long-term debt (52,140) (4,067) Dividends paid (10,552) (10,382) Payments to acquire treasury stock (3,001) - Proceeds from issuance of common stock 663 1,138 Net cash provided (required) by financing -------- -------- activities 16,235 (4,517) EFFECT OF EXCHANGE RATE CHANGES ON CASH -------- -------- AND CASH EQUIVALENTS (471) - INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 87 (27,775) Cash and cash equivalents at beginning of period 5,404 45,822 -------- -------- Cash and cash equivalents at end of period $ 5,491 $ 18,047 ======== ======== Supplemental Data: Interest payments, net of amounts capitalized $ 4,562 $ 9,277 Income tax payments, net of refunds $ 3,941 $ 2,768 See accompanying notes to consolidated financial statements. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS ------------------------------------------ 1. Basis of Presentation --------------------- The accompanying unaudited consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting only of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the six months ended December 31, 1994 are not necessarily indicative of the results that may be expected for the year ending June 30, 1995. For further information, refer to the consolidated financial statements and footnotes included in the Company's 1994 Annual Report on Form 10-K. The June 30, 1994 condensed balance sheet data was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles. 2. Earnings Per Common Share ------------------------- Primary earnings per common share are computed by dividing net income (less preferred dividends net of tax benefits) by the weighted average number of common shares and common share equivalents outstanding during the period. On a fully-diluted basis, both net earnings and shares outstanding are adjusted to assume the conversion of the convertible preferred stock. 3. Inventories ----------- December 31 June 30 1994 1994 ---- ---- (in thousands) Finished $ 76,339 $ 76,187 Work in process 103,265 85,247 Raw materials and supplies 32,122 29,558 -------- -------- Total at current cost 211,726 190,992 Excess of current cost over LIFO values 125,730 125,730 -------- -------- Inventory per Balance Sheet $ 85,996 $ 65,262 ======== ======== 3. Inventories, continued ----------- The current cost of LIFO-valued inventories was $187.8 million at December 31, 1994 and $165.8 million at June 30, 1994. Reductions in LIFO-valued inventories resulted in an increase in net income of approximately $1.5 million or $.19 per share and $3.6 million or $.45 per share for the three and six months ended December 31, 1993, respectively. 4. Acquisition of Wholly-Owned Subsidiaries ---------------------------------------- On July 22, 1994, the Company acquired all of the outstanding shares of Certech, Inc., and an affiliated company, for $16.7 million, including acquisition costs, comprised of $13.5 million in cash and 53,124 shares of treasury common stock. Certech manufactures a broad line of complex injection molded ceramics parts. The acquisition has been accounted for using the purchase method of accounting, and accordingly, the purchase price has been allocated to the assets purchased and the liabilities assumed based upon the preliminary estimated fair values at the date of acquisition. The excess of purchase price over the preliminary estimated fair values of the net assets acquired was approximately $10 million and has been recorded as intangible assets and goodwill, and is included in other assets on the consolidated balance sheet. As previously reported, on July 28, 1993, the Company acquired all of the outstanding shares of Aceros Fortuna, S.A. de C.V., a Mexican steel distribution company, and two affiliated companies. The operating results of these acquired businesses have been included in the Consolidated Statement of Income from the dates of acquisition. On the basis of a pro forma combination of the results of operations as if the acquisitions had taken place at the beginning of fiscal 1994, combined net sales would have been approximately $330 million for the six months ended December 31, 1994, and $151 million and $286 million for the three and six months ended December 31, 1993, respectively. Combined pro forma net income and earnings per share would not have been materially different from the reported amounts for both periods. Such pro forma amounts are not necessarily indicative of what the actual combined results of operations might have been if the acquisitions had been effective at the beginning of fiscal 1994. 5. Debt Arrangements ----------------- During the six months ended December 31, 1994, the Company issued $50.0 million of medium-term debt securities with a 7.68% average interest rate under a Form S-3 registration statement ("Shelf Registration") on file with the Securities and Exchange Commission. The proceeds were used to retire borrowings under credit arrangements. 6. Foreign Currency Translation Adjustments ---------------------------------------- The functional currency for the majority of the Company's international operations is the local currency, and, accordingly, the respective assets and liabilities are translated at end of period exchange rates, while the income and expense components are translated at average exchange rates prevailing during the period. The resulting translation adjustments are accumulated in a separate section of shareholders' equity on the consolidated balance sheet. During the quarter ended December 31, 1994, the value of the Mexican peso fell versus that of the U.S. dollar. As a result of this devaluation, the Company recorded a reduction to Shareholders' Equity of $4.7 million for the quarter related to Aceros Fortuna, the Company's Mexican steel distributor acquired on July 28, 1993. MANAGEMENT'S DISCUSSION & ANALYSIS OF RESULTS OF OPERATIONS ----------------------------------------------------------- Second Quarter Results: - ---------------------- Net income for the quarter ended December 31, 1994 was $9.8 million versus $7.4 million in the same quarter last year. Primary earnings per share were $1.16 compared with $.86 for the same period a year ago. The improved results were primarily due to higher sales volume coupled with increased selling prices. Sales were $172.4 million, a 17 percent increase over the $147.1 million last year. The increase in sales was primarily a result of 10 percent higher Steel Division shipment levels chiefly of stainless bar and wire products to automotive and equipment manufacturers. Sales were also higher because of the inclusion of the sales of Certech, Inc., acquired in July 1994. In addition, the Company has recently implemented selling price increases to offset increasing labor and supply costs and has instituted surcharges to offset sharply rising raw material costs. Cost of sales as a percent of net sales was 74 percent for the second quarters of both fiscal 1995 and 1994. This year's second quarter was favorably impacted by higher production efficiencies due to increased capacity utilization. Last year's second quarter included the favorable impact of lower inventory levels and the use of the LIFO inventory valuation method which reduced costs by $2.5 million before taxes, or $.19 per share. Six Month Results: - ----------------- Net income for the six months ended December 31, 1994 was $14.8 million, compared with $10.1 million for the same period last year. Primary earnings per share were $1.71 compared with $1.16 for the same period a year ago. The improved results were primarily due to higher sales volume and production efficiencies due to increased capacity utilization. Additionally, earnings last year were adversely affected by a one-time charge of $1.5 million, or $.19 per share, to increase net deferred tax liabilities for a change in the U.S. corporate income tax rate. Sales were $328.5 million, a 19 percent increase from $276.6 million last year. This increase was primarily due to a 12 percent increase in Steel Division unit volume shipments and the inclusion of the results of Certech, Inc. and Aceros Fortuna S.A. de C.V., which were acquired on July 22, 1994 and July 28, 1993, respectively. Cost of sales increased to 76 percent of net sales in the current fiscal year versus 74 percent for the same period last year, primarily due to higher raw material costs. Last year's cost of sales was favorably impacted by an inventory reduction program and the use of the LIFO inventory valuation method which reduced costs by $5.8 million before taxes, or $.45 per share for the six month period. Interest costs decreased by $3.5 million for the first six months of this fiscal year compared to the same period last year. This decrease was primarily the result of replacing high interest cost debt with lower interest cost borrowings in the March 1994 quarter, combined with increased capitalized interest costs during the pre-operating period of Walsin-CarTech Specialty Steel Corporation, a joint venture with Walsin Lihwa Corporation in the Republic of China (Taiwan). PART II - OTHER INFORMATION --------------------------- Item 1. Legal Proceedings. ------------------------- There are no material pending legal proceedings, other than ordinary routine litigation incidental to the business, to which the Company or any of its subsidiaries is a party or to which any of their properties is subject. There are no material proceedings to which any Director, Officer, or affiliate of the Company, or any owner of more than five percent of any class of voting securities of the Company, or any associate of any Director, Officer, affiliate, or security holder of the Company, is a party adverse to the Company or has a material interest adverse to the interest of the Company or its subsidiaries. There is no administrative or judicial proceeding arising under any Federal, State or local provisions regulating the discharge of materials into the environment or primarily for the purpose of protecting the environment that (1) is material to the business or financial condition of the Company, (2) involves a claim for damages, potential sanctions or capital expenditures exceeding ten percent of the current assets of the Company or (3) includes a governmental authority as a party and involves potential monetary sanctions in excess of $100,000. Item 2. Changes in Securities. ----------------------------- See Note 5 to the Financial Statements contained in Part I. Item 4. Submission of Matters to a Vote of Security Holders. ----------------------------------------------------------- The Annual Meeting of Stockholders of the Company was held on October 24, 1994. The following directors were elected at the meeting: Dr. C. McCollister Evarts; William J. Hudson, Jr.; Mylle Bell Mangum; and Paul R. Roedel. The following directors continued their terms of office after the meeting: Robert W. Cardy; Arthur E. Humphrey; Edward W. Kay; Frederick C. Langenberg; Marcus C. Bennett; Dennis M. Draeger; Carl R. Garr; Marlin Miller, Jr. Set forth below is a description of the matters voted upon and the number of votes cast for, against or withheld, as well as the number of abstentions and broker nonvotes, as applicable to each such matter. 1. Election Of Directors. The following four directors were elected to the Board of Directors of the Company. There were no other nominees for director. A. Dr. C. McCollister Evarts Shares voted for: 7,428,204 Shares withheld: 128,659 Abstentions: N/A Broker nonvotes: N/A B. William J. Hudson, Jr. Shares voted for: 7,431,147 Shares withheld: 125,716 Abstentions: N/A Broker nonvotes: N/A C. Mylle Bell Mangum Shares voted for: 7,425,421 Shares withheld: 131,442 Abstentions: N/A Broker nonvotes: N/A D. Paul R. Roedel Shares voted for: 7,424,538 Shares withheld: 132,325 Abstentions: N/A Broker nonvotes: N/A 2. The accounting firm of Coopers & Lybrand was elected independent accountants for the year ending June 30, 1995. Shares voted for: 7,456,925 Shares voted against: 61,187 Abstentions: N/A Broker nonvotes: N/A Item 5. Other Information. ------------------------- 1. On December 8, 1994 the Board of Directors of the Company elected Kathryn C. Turner as a director to serve until the Annual Stockholders meeting on October 23, 1995. 2. On December 8, 1994 the Board of Directors of the Company adopted a new set of By-laws. A complete copy of the By-laws as amended is attached as an exhibit to this report. Item 6. Exhibits and Reports on Form 8-K. ---------------------------------------- a. The following documents are filed as exhibits: 3. By-laws as amended on December 8, 1994. 11. Statement regarding computation of per share earnings. 99. Additional Exhibits. A. Press release dated December 9, 1994. b. The Company filed no Reports on Form 8-K for events occurring during the quarter of the fiscal year covered by this report. Item 3 is omitted as the answer is negative or the items are not applicable. SIGNATURES ---------- Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. CARPENTER TECHNOLOGY CORPORATION -------------------------------- (Registrant) Date: February 9, 1995 s/G. Walton Cottrell ------------------- -------------------------------- G. Walton Cottrell Sr. Vice President - Finance and Chief Financial Officer EX-99 2 EXHIBIT INDEX EXHIBIT INDEX ------------- Exhibit No. Title Page - ----------- ----- ---- 3. By-laws as amended on December 8, E-1 - E-19 1994 11. Statement regarding computation of per share earnings. E-20 & E-21 27. Financial data schedule E-22 99. Press release dated December 9, 1994 E-23 & E-24 EX-3 3 BYLAW EXHIBIT By-Laws of CARPENTER TECHNOLOGY CORPORATION As Last Amended Effective October 24, 1994 l. MEETINGS OF STOCKHOLDERS. ------------------------ l.l Annual Meeting. The annual meeting of stockholders -------------- shall be held during the last two weeks of October in each year, and shall be held at a place and time determined by the Board of Directors (the "Board"). At an annual meeting of stockholders, only such business shall be conducted as shall have been properly brought before the meeting. To be properly brought before an annual meeting, business must be (a) specified in the notice of meeting (or any supplement thereto) given by or at the direction of the Board, or (b) otherwise brought before the meeting by or at the direction of the Board or by a stockholder in accordance with the following provisions. In addition to any other applicable requirements, for business to be brought before an annual meeting by a stockholder, the stockholder must have given notice thereof in writing to the Secretary of the Corporation, which must be delivered to or mailed and received at the principal executive offices of the Corporation not less than 60 days nor more than 90 days prior to the anniversary date of the immediately preceding annual meeting of the stockholders; provided, however, that in the event that the annual meeting is called for a date that is not within 30 days before or after such anniversary date, notice by the stockholder must be so received not later than the close of business on the 10th day following the day on which notice of the date of the annual meeting was mailed or public disclosure of the date of the annual meeting was made, whichever first occurs. A stockholder's notice to the Secretary shall set forth as to each matter the stockholder proposes to bring before the annual meeting (i) a brief description of the business desired to be brought before the annual meeting and the reasons for conducting such business at the annual meeting, (ii) the name and record address of the stockholder proposing such business, (iii) the class and number of shares of the Corporation which are beneficially owned by the stockholder, and (iv) any material interest of the stockholder in such business. Notwithstanding anything in these By-Laws to the contrary, no business shall be conducted at the annual meeting except in accordance with the procedures set forth in this Section 1.1. The chairperson of an annual meeting shall, if the facts warrant, determine and declare to the meeting that business was not properly brought before the meeting in accordance with the provisions of this Section 1.1 and, if the chairperson should so determine, any such business not properly brought before the meeting shall not be transacted. l.2 Special Meetings. Except as otherwise required by law ---------------- and subject to the rights of the holders of any class or series of stock having preference over the Common Stock as to dividends or upon liquidation, special meetings of the stockholders may be called only by the Board pursuant to a resolution approved by a majority of the entire Board. At a special meeting of the stockholders, only such business shall be conducted as shall be specified in the notice of meeting (or any supplement thereto) given by or at the direction of the Board. l.3 Place of Meetings. Meetings of the stockholders may be ----------------- held in or outside Delaware at the place specified in the notice by the person or persons calling the meeting. 1.4 Notice of Meetings. Written notice of each meeting of ------------------ stockholders shall be mailed to each stockholder entitled to vote at the meeting, not less than 20 nor more than 40 days before the meeting, and shall state the time and place of the meeting and the purposes for which it is called. 1.5 Quorum. The presence in person or by proxy of the ------ holders of a majority of the shares entitled to vote shall constitute a quorum for the transaction of any business, except as otherwise provided by law. In the absence of a quorum any officer entitled to preside at or act as secretary of such meeting shall have the power to adjourn the meeting from time to time until a quorum is present, without further notice other than announcement at the meeting of the adjourned time and place (provided that if a meeting is adjourned for more than 30 days, or if a new record date is set, a new notice must be given). At any adjourned meeting at which a quorum is present, any action may be taken which might have been taken at the meeting as originally called. l.6 Voting; Proxies. Stockholders may attend meetings and --------------- vote either in person or by proxy. Without limiting the manner in which a stockholder may authorize another person or persons to act for the stockholder as proxy, either of the following shall constitute a valid means by which a stockholder may grant such authority: (i) A stockholder may execute a writing authorizing another person or persons to act for the stockholder as proxy. Execution may be accomplished by the stockholder or an authorized officer, director, employee or agent signing such writing or causing their signature to be affixed to such writing by any reasonable means including, but not limited to, by facsimile signature. (ii) A stockholder may authorize another person or persons to act for the stockholder as proxy by transmitting or authorizing the transmission of a telegram or other means of electronic transmission to the person who will be the holder of the proxy or to a proxy solicitation firm, proxy support service organization or like agent duly authorized by the person who will be the holder of the proxy to receive such transmission, provided that any such telegram or other means of electronic transmission must either set forth or be submitted with information from which it can be determined that the telegram or other electronic transmission was authorized by the stockholder. Any copy, facsimile telecommunication or other reliable reproduction of the writing or transmission authorizing another person or persons to act as proxy for a stockholder may be substituted or used in lieu of the original writing or transmission for any and all purposes for which the original writing or transmission could be used, provided that such copy, facsimile telecommunication or other reproduction shall be a complete reproduction of the entire original writing or transmission. Corporate action to be taken by stockholder vote, other than the election of directors, shall be authorized by a majority of the votes cast at a meeting of stockholders at which a quorum is present, except as otherwise provided by law, by the Certificate of Incorporation, as amended from time to time, or by these By-Laws. Directors shall be elected in the manner provided in Section 2.l of these By-Laws. l.7 Inspectors of Election. In advance of every meeting of ---------------------- the stockholders, the Board by resolution or the Chairperson or President shall appoint one or more persons to act as inspectors of election at the meeting. One or more other persons may be designated as alternate inspectors to replace any inspector who is unable or unwilling to act at such meeting. If no inspector or alternate inspector has been appointed or is present, ready and willing to act at any meeting, the chairperson of the meeting shall appoint one or more persons to act as inspectors at the meeting. Each inspector, before discharging the duties of office, shall faithfully take and sign an oath to execute the duties of inspector with strict impartiality and according to the best of the inspector's ability. The inspectors shall have the duties prescribed by law. Any person, including persons who serve the Corporation in other capacities, including without limitation, as officers, employees, agents or representatives of the Corporation, may act as an inspector, except that no candidate for the office of director shall act as an inspector of any election for directors. 1.8 Opening and Closing of the Polls. At every meeting of -------------------------------- the stockholders, the chairperson of the meeting shall fix and announce at the meeting the date and time of the opening and the closing of the polls for each matter upon which the stockholders will vote at the meeting. 2. BOARD OF DIRECTORS. ------------------ 2.l Number, Election and Term of Directors. The business -------------------------------------- of the Corporation shall be managed under the direction of the Board, which shall consist of not less than three nor more than fifteen directors, the exact number of directors to be determined from time to time by resolution adopted by affirmative vote of a majority of the entire Board. A majority of the Board must be persons who are neither current nor former officers or employees of the Corporation or its subsidiaries. The Board of Directors shall be divided into three classes. Each class shall consist, as nearly as may be possible, of one-third of the total number of directors constituting the entire Board. The term of office of the first class will expire at the first annual meeting of the stockholders after the initial classification of the Board, that of the second class will expire at the second meeting after the initial classification of the Board, and that of the third class will expire at the third annual meeting after the initial classification of the Board. At each annual meeting of the stockholders after such initial classification of the Board, directors shall be chosen for a term of three years to succeed those whose terms expire, and shall hold office until the third following annual meeting of stockholders and until the election of their respective successors, subject to the provisions of Section 2.6 hereof. If the number of directors is changed, any increase or decrease shall be apportioned among the classes so as to maintain the number of directors in each class as nearly equal as possible, and any additional director of any class elected to fill a vacancy resulting from an increase in such class shall hold office for a term that shall coincide with the remaining term of that class, but in no case may a decrease in the number of directors shorten the term of any incumbent director. Directors shall be elected at each annual meeting of stockholders by a plurality of the votes cast by written ballot. As used in these By-Laws, "entire Board" means the total number of directors which the Corporation would have if there were no vacancies. 2.2 Quorum and Manner of Acting. A majority of the --------------------------- directors in office (but not less than one-third of the entire Board) shall constitute a quorum for the transaction of business at any meeting, except as provided in Section 2.7 of these By-Laws. Action of the Board shall be authorized by the vote of a majority of the directors present at the time of the vote, if a quorum is present, unless otherwise provided by law or these By-Laws. In the absence of a quorum, a majority of the directors present may adjourn any meeting from time to time until a quorum is present, on notice given as provided in Section 2.5 hereof. 2.3 Annual and Regular Meetings. Annual meetings of the --------------------------- Board, for the election of officers and consideration of other matters, shall be held either (a) without notice immediately after the annual meeting of stockholders and at the same place, or (b) as soon as practicable after the annual meeting of stockholders on notice as provided in Section 2.5 of these By-Laws. Regular meetings of the Board may be held at such times and places as the Board determines. 2.4 Special Meetings. Special meetings of the Board may be ---------------- called by the Chairperson of the Board or the Chief Executive Officer of the Corporation or by three directors, one from each class of directors then in office. 2.5 Notice of Meetings; Waiver of Notice. Notice of the ------------------------------------ time and place of each regular and special meeting of the Board, and of each annual meeting not held immediately after the annual meeting of stockholders and at the same place, shall be given to each director by mailing it to the Director at the Director's residence or usual place of business at least five days before the meeting, or by delivering or telephoning or telegraphing it to the Director at least one day before the meeting. Notice of a special meeting shall also state the general purpose or purposes for which the meeting is called. Notice need not be given to any director who submits a signed waiver of notice before or after the meeting, or who attends the meeting without protesting the lack of notice to him or herself, either before the meeting or when it begins. Notice of any adjourned meeting need not be given, other than by announcement at the meeting at which the adjournment is taken. 2.6 Resignation and Retirement of Directors. Any director --------------------------------------- may resign at any time by giving written notice to the Chief Executive Officer or Secretary of the Corporation, to take effect at the time specified therein. The acceptance of such resignation, unless required by the terms thereof, shall not be necessary to make it effective. Unless otherwise provided by resolution of the Board, any director who is also an officer of the Corporation shall retire from the Board upon the earlier of (a) attaining age 65 or (b) retirement as an officer of the Corporation. Any director who is not an officer of the Corporation shall retire from the Board at the next annual meeting of stockholders after the Director attains age 70. 2.7 Vacancies. Any vacancy in the Board, including one --------- created by an increase in the number of directors, may be filled for the unexpired term by a majority vote of the remaining directors, though not a quorum. 2.8 Action by Directors Without a Meeting. Any action by ------------------------------------- the Board or any committee of the Board may be taken without a meeting, if a written consent to the action is signed by all of the members of the Board or committee. 2.9 Compensation. Directors shall receive such ------------ compensation as the Board determines, together with reimbursement of their reasonable expenses in connection with the performance of their duties. A director may also be paid for serving the Corporation, its affiliates or subsidiaries in other capacities. 2.10 Nominations of Director Candidates. Only persons who ---------------------------------- are nominated in accordance with the following procedures shall be eligible for election as directors at meetings of stockholders. Nominations of persons for election to the Board of the Corporation may be made at a meeting of stockholders by (a) the Board, (b) any committee whose responsibilities include director nominations or person appointed by the Board, or (c) any stockholder of the Corporation entitled to vote for the election of directors at the meeting who complies with the notice procedures set forth in this Section 2.10. Such nominations, other than those made by or at the direction of the Board, shall be made pursuant to timely notice in writing to the Secretary of the Corporation. To be timely, a stockholder's notice shall be delivered to or mailed and received at the principal executive offices of the Corporation not less than 60 days nor more than 90 days prior to the anniversary date of the immediately preceding annual meeting of the stockholders; provided, however, that in the event that the annual meeting is called for a date that is not within 30 days before or after such anniversary date, notice by the stockholder in order to be timely must be so received not later than the close of business on the 10th day following the date on which notice of the date of the annual meeting was mailed or public disclosure of the date of the annual meeting was made, whichever first occurs. Such stockholder's notice to the Secretary shall set forth (a) as to each person whom the stockholder proposes to nominate for election or reelection as a director, (i) the name, age, business address and residence address of the person, (ii) the principal occupation or employment of the person, (iii) the class and number of shares of capital stock of the Corporation which are beneficially owned by the person, and (iv) any other information relating to the person that is required to be disclosed in solicitations for proxies for election of directors pursuant to Schedule 14A under the Securities Exchange Act of 1934, as amended; and (b) as to the stockholder giving the notice (i) the name and record address of the stockholder and (ii) the class and number of shares of capital stock of the Corporation which are beneficially owned by the stockholder. The Corporation may require any proposed nominee to furnish such other information as may reasonably be required by the Corporation to determine the eligibility of such proposed nominee to serve as a director of the Corporation. The chairperson of the meeting shall, if the facts warrant, determine and declare to the meeting that a nomination was not made in accordance with the foregoing procedure and, if the chairperson should so determine, the chairperson shall so declare to the meeting and the defective nomination shall be disregarded. 3. COMMITTEES. ---------- 3.l Standing Committees. The Board shall by resolution ------------------- designate an Audit Committee, a Corporate Governance Committee, a Finance Committee and a Human Resources Committee, each consisting of two or more members of the Board, but, except for the Finance Committee, excluding any current or former officer or employee of the Corporation or its subsidiaries. The members of each such Committee shall serve at the pleasure of the Board, and the Board shall designate from the membership a Committee chairperson and shall fill any membership vacancies. Each such Committee shall determine from time to time the scope of its responsibilities, which shall be set forth in a written statement to be submitted to the Board for approval. Each such Committee shall perform such other functions and exercise such other powers as may be delegated to it from time to time by the Board. 3.2 Executive Committee. The Board may by resolution ------------------- designate an Executive Committee of four or more members of the Board, which Committee shall have all the authority of the Board except as otherwise provided in the resolution or by law. The members of such Committee shall serve at the pleasure of the Board, and the Board shall designate from among the membership a Committee chairperson and shall fill any membership vacancies. 3.3 Other Committees. The Board may by resolution provide ---------------- for such other standing or special committees, composed of two or more members of the Board, and discontinue the same at its pleasure. Each such committee shall have such powers and perform such duties, not inconsistent with law, as may be assigned to it by the Board. 3.4 Meetings of Committees. Each committee of the Board ---------------------- shall fix its own rules of procedure consistent with the provisions of the Board governing such committee, and shall meet as provided by such rules or by resolution of the Board, and it shall also meet at the call of its chairperson or any two members of such committee. Unless otherwise provided by such rules or by such resolution, the provisions of Article 2 of these By-Laws relating to the place of holding and notice required of meetings of the Board shall govern committees of the Board. A majority of each committee shall constitute a quorum thereof; provided, however, that in the absence of any member of such committee, the members thereof present at any meeting, whether or not they constitute a quorum, may appoint a member of the Board otherwise qualified for membership of such committee to act in the place of such absent member. The vote of a majority of such quorum at a duly constituted meeting shall be sufficient to authorize any action within the scope of responsibilities of each committee, unless otherwise provided by the rules of such committee or by resolution of the Board. Each committee shall keep minutes of its meetings and all action taken by such committee shall be reported to the Board at its next meeting. 4. OFFICERS. -------- 4.l Executive and Other Officers. The officers of the ---------------------------- Corporation shall be a Chairperson of the Board (who shall be elected from among the Directors); a President, if the Board chooses to elect one; one or more Vice Presidents, a Treasurer; a Secretary and a Controller (any of whom may be designated as executive officers). The offices of Chairperson and President may be held by the same person, and the offices of Treasurer, Controller or Secretary may be filled by the same person who may also be a Vice President. The Board shall designate the Chairperson or the President as Chief Executive Officer of the Corporation. The Officers specifically listed above, or otherwise designated as executive officers, shall be elected annually by the Board, and each such officer shall hold office until the next annual meeting of the Board and until the election of his successor, or until his earlier resignation or removal. The Board may elect other officers including Vice Presidents (not otherwise designated by the Board as executive officers), Assistant Vice Presidents, Assistant Secretaries and Assistant Treasurers, each of whom shall hold office for such period and have such powers and duties as the Board determines. 4.2 Vacancies. A vacancy in any office may be filled for --------- the unexpired term in the manner prescribed in Section 4.l of these By-Laws for election or appointment to the office. 4.3 Chairperson of the Board. The Chairperson of the ------------------------ Board, if one is elected, shall preside at all meetings of the Board and of the stockholders. The Chairperson shall perform all duties incident to the office of Chairperson of the Board and shall have such other powers and duties as the Board assigns to that individual. In the absence of the Chairperson, the Board shall designate a member of the Board as temporary Chairperson. 4.4 The President. The President shall perform all duties ------------- incident to the office of President and such other duties as the Board assigns to that individual. 4.5 Chief Executive Officer. The Chief Executive Officer ----------------------- shall, subject to the control of the Board, have the general management and control of the business and affairs of the Corporation and, in general, shall have all powers and perform all duties incident to the office of Chief Executive Officer. 4.6 Vice Presidents. Each Vice President shall have such --------------- designation as the Board may determine and such powers and duties as the Board or the Chief Executive Officer, subject to the control of the Board, assigns to that individual. One of the Vice Presidents, who is an executive officer, may be designated by the Board to act, in the absence of the Chief Executive Officer, in the Chief Executive Officer's place. 4.7 The Treasurer. The Treasurer shall, subject to the ------------- direction of the Chief Executive Officer, have charge of all funds, securities, notes, receipts and disbursements of the Corporation. The Treasurer shall be responsible for the deposit of Corporation funds in or withdrawal from such banks or other depositories as shall be selected by the Chief Executive Officer with the approval of the Board, and shall provide all necessary cash and other records to the Controller. The Treasurer shall perform such other duties as treasurers of corporations usually have or as the Chief Executive Officer or the Vice President to whom the Treasurer reports assigns to that individual. 4.8 The Secretary. The Secretary shall be the secretary ------------- of, and keep the minutes of, all meetings of the Board and of the stockholders, shall be responsible for giving notice of all meetings of the Board and of the stockholders and shall keep the seal and shall apply it to any instrument requiring it. The Secretary shall be custodian of the corporate records (except accounting records), contracts and documents, and shall have such other powers and duties as the Chief Executive Officer or the Vice President to whom the Secretary reports assigns to that individual. In the absence of the Secretary from meetings, the minutes shall be kept by the person appointed for that purpose by the presiding officer. 4.9 The Controller. The Controller shall be the officer in -------------- charge of accounts of the Corporation and shall be responsible for the maintenance of adequate accounting and internal control procedures, and adequate records of the Corporation, for the preparation of financial statements and reports on the operation of the business. The Controller shall be responsible for the administration of the office and shall have such other powers and duties as the Board, the Chief Executive Officer or the Vice President to whom the Controller reports assigns to that individual. 4.10 Division Officers. For administrative and management ----------------- purposes, the Chief Executive Officer, with the approval of the Board, may appoint such division officers with such titles, as deemed necessary or advisable for the transaction of the business of the Corporation. Any division officer may be removed from office as a division officer, either with or without cause, at any time, by the Board, the Chief Executive Officer or by any other executive officer of the Corporation or officer of a division to whom such division officer may at the time be responsible. A division officer shall not be an officer of the Corporation by virtue of his or her position as such division officer. Division officers shall perform such duties as shall be assigned to them from time to time by the Chief Executive Officer but no division officer shall execute any deed, lease or other conveyance or transfer of real property of the Corporation, any note or other evidence of indebtedness or any mortgage or other security for indebtedness. 5. SHARES. ------ 5.l Certificates. The shares of the Corporation shall be ------------ represented by certificates in the form approved by the Board, unless the Board by resolution provides that some or all classes or series of stock shall be uncertificated shares (provided that no such resolution shall apply to shares theretofore represented by a certificate unless and until such certificate is surrendered to the Corporation). Notwithstanding the adoption of such resolution by the Board, every holder of shares represented by certificates and upon request every holder of uncertificated shares shall be entitled to have a certificate representing such shares registered in his or her name on the Corporation's books. Each certificate shall be signed by the Chairperson, the President or a Vice President and by the Secretary or the Treasurer. Any or all the signatures on the certificate may be a facsimile. 5.2 Transfers. Shares shall be transferable only on the --------- Corporation's books, (and, in the case of shares represented by certificates,) upon surrender of the certificate for the shares, properly endorsed. The Board may require satisfactory surety before issuing a new certificate to replace a certificate claimed to have been lost or destroyed. 5.3 Transfer Agents and Registrars. The Corporation shall ------------------------------ have one or more transfer agents and one or more registrars of its shares, whose respective duties shall be defined by the Board. Unless the Board specifically directs otherwise with respect to a particular certificate, no certificates for shares shall be valid unless countersigned by a transfer agent and unless registered by a registrar. 6. MISCELLANEOUS. ------------- 6.l Seal. The Board shall adopt a corporate seal, which shall be in the form of a circle and shall bear the Corporation's name and the year and state in which it was incorporated. 6.2 Fiscal Year. The Board may determine the Corporation's ----------- fiscal year. Until changed by the Board, the Corporation's fiscal year shall end on June 30. 6.3 Voting of Shares in Other Corporations. Shares in -------------------------------------- other corporations which are held by the Corporation may be represented and voted by the Chairperson, the President or a Vice President of this Corporation or by proxy or proxies appointed by one of them. The Board may, however, appoint some other person to vote the shares. 6.4 Indemnification of Officers, Directors, Employees and Agents. ------------------------------------------------------------ The Corporation shall, to the fullest extent permitted by Section l45 of the Delaware General Corporation Law as amended from time to time, indemnify all persons whom it may indemnify under that Section. For these purposes an employee or agent shall be deemed to have acted in good faith only if his or her action were within the scope of employment as defined by an agreement with the Corporation or in accordance with the rules of the Corporation or an authorized officer thereof. 6.5 Amendments. These By-Laws may be amended, repealed or ---------- adopted by the affirmative vote of a majority of the entire Board or of the holders of two-thirds of the issued and outstanding stock of the Corporation entitled to vote. EX-11 4 EPS EXHIBIT Exhibit 11 CARPENTER TECHNOLOGY CORPORATION AND SUBSIDIARIES PRIMARY EARNINGS PER COMMON SHARE COMPUTATIONS for the three and six months ended December 31, 1994 and 1993 (in thousands, except per share data) Three Months Six Months ------------------ ------------------ 1994 1993 1994 1993 ---- ---- ---- ---- Net Income for Primary - ---------------------- Earnings Per Common ------------------- Share ----- Net income $ 9,827 $ 7,360 $ 14,759 $ 10,132 Dividends accrued on convertible preferred stock, net of tax benefits (400) (413) (800) (819) -------- -------- -------- -------- Net income for primary earnings per common share $ 9,427 $ 6,947 $ 13,959 $ 9,313 ======== ======== ======== ======== Weighted Average Common - ----------------------- Shares ------ Weighted average number of common shares outstanding 8,126 7,999 8,132 7,994 Effect of shares issuable under the stock option plans 35 33 50 25 -------- -------- -------- -------- Weighted average common shares 8,161 8,032 8,182 8,019 ======== ======== ======== ======== Primary Earnings Per - -------------------- Common Share $ 1.16 $ .86 $ 1.71 $ 1.16 ------------ ======== ======== ======== ======== Exhibit 11 CARPENTER TECHNOLOGY CORPORATION AND SUBSIDIARIES FULLY DILUTED EARNINGS PER COMMON SHARE COMPUTATIONS for the three and six months ended December 31, 1994 and 1993 (in thousands, except per share data) Three Months Six Months ------------------- ------------------ 1994 1993 1994 1993 ---- ---- ---- ---- Net Income for Fully - -------------------- Diluted Earnings Per -------------------- Common Share ------------ Net income $ 9,827 $ 7,360 $ 14,759 $ 10,132 Shortfall between common and preferred dividend (199) (199) (397) (397) -------- -------- -------- -------- Net income for fully diluted earnings per common share $ 9,628 $ 7,161 $ 14,362 $ 9,735 ======== ======== ======== ======== Weighted Average - ---------------- Common Shares ------------- Weighted average number of common shares outstanding 8,126 7,999 8,132 7,994 Conversion of preferred shares 459 461 459 461 Effect of shares issuable under the stock option plans 32 52 51 52 -------- -------- -------- -------- Weighted average common shares 8,617 8,512 8,642 8,507 ======== ======== ======== ======== Fully Diluted Earnings Per Common Share $ 1.11 $ .84 $ 1.66 $ 1.14 ======== ======== ======== ======== EX-27 5 FINANCIAL DATA SCHEDULE
5 1,000 6-MOS JUN-30-1995 DEC-31-1994 5,491 0 91,603 0 85,996 193,184 747,064 345,774 777,887 133,649 167,505 48,135 0 28,965 164,625 777,887 328,484 328,484 249,485 249,485 315 0 5,762 23,729 8,970 14,759 0 0 0 14,759 1.71 1.66
EX-99 6 PRESS RELEASE EXHIBIT Cathy Souders (610) 208-2639 IMMEDIATE RELEASE CARPENTER TECHNOLOGY ELECTS NEW DIRECTOR Reading, PA (December 9, 1994) -- Carpenter Technology Corporation (NYSE:CRS) has elected Kathryn C. Turner, chairperson and chief executive officer of Standard Technology, Inc. (STI), to its Board of Directors. Turner, 47, founded STI, a high-technology, engineering, systems integration and manufacturing firm, in 1985. STI is headquartered in Rockville, Md., with offices in northern Virginia; Dallas, Tex. and Jacksonville, Fla. The company was ranked 63rd in Inc. Magazine's 1991 list of America's 500 fastest growing private companies. Also, it was the only small business to receive the National Aeronautics and Space Administration Agency Honor Award in 1992. In 1994, STI had $17 million in contracts with the Department of Defense and other federal agencies and their prime contractors. In November 1993, Turner was appointed to the Commission on The Future of Worker-Management Relations, a joint commission of the Departments of Labor and Commerce, established by President Clinton. She has participated in CEO meetings with Commerce Secretary Ronald H. Brown and Kenneth Brody (Export-Import Bank of the United States) regarding the Trade Promotion Coordinating Committee, and now serves a one-year term as a member of the EXIMBANK Advisory Committee. Turner was the first woman appointed to the Defense Policy Advisory Committee on Trade, an advisory committee to the Secretary of Defense and the U.S. Trade Representative on major policy areas such as trade negotiations, defense trade policy, financial competitiveness and government relations. Turner holds a bachelor's degree in chemistry from Howard University. After graduating, she began her career as a chemist for the Naval Ordinance Station in Maryland. In 1969, she became involved with software development for Control Data Corporation, then advanced through various technical and management positions in several firms in the Washington, D.C. area. In the late '70s, while with General Electric's Information Services Company, she moved to sales, where she became one of the company's top revenue producers. Turner becomes the thirteenth board member of Carpenter Technology Corporation, a major producer of specialty steel long products and high-performance alloys for aerospace, automotive, electronics and other industries worldwide. In fiscal year 1994 (ended June 30, 1994), the company had sales of $628.8 million. # # # -----END PRIVACY-ENHANCED MESSAGE-----