-----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, VUDnNr0wJYXJlp0d42nr318ltlnLWsF+J0vk2EULX7ltWnCBnZ045K6KFvCAu3pC EsQYYBhgV1Cx6Nwho3gDUg== 0000006176-94-000007.txt : 19941117 0000006176-94-000007.hdr.sgml : 19941117 ACCESSION NUMBER: 0000006176-94-000007 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19940930 FILED AS OF DATE: 19941114 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMPCO PITTSBURGH CORP CENTRAL INDEX KEY: 0000006176 STANDARD INDUSTRIAL CLASSIFICATION: 3564 IRS NUMBER: 251117717 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-00898 FILM NUMBER: 94559060 BUSINESS ADDRESS: STREET 1: 600 GRANT ST STE 4600 CITY: PITTSBURGH STATE: PA ZIP: 15219 BUSINESS PHONE: 4124564400 FORMER COMPANY: FORMER CONFORMED NAME: SCREW & BOLT CORP OF AMERICA DATE OF NAME CHANGE: 19710518 10-Q 1 SEPTEMBER 30, 1994 10-Q FORM lO-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark one) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 or 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 1994 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 1-898. AMPCO-PITTSBURGH CORPORATION Incorporated in Pennsylvania. I.R.S. Employer Identification No. 25-1117717. 600 Grant Street, Pittsburgh, Pennsylvania 15219 Telephone Number 412/456-4400 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 periods 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____ On November 11, 1994, 9,577,621 common shares were outstanding. The exhibit index is located on page 12 of 37 pages. - 1 - AMPCO-PITTSBURGH_CORPORATION INDEX Page_No. Part I - Financial Information: Item 1 - Consolidated Financial Statements Consolidated Balance Sheets - September 30, 1994 and December 31, 1993 3 Consolidated Statements of Income - Nine months ended September 30, 1994 and 1993; Three Months Ended September 30, 1994 and 1993 4 Consolidated Statements of Cash Flows - Nine Months Ended September 30, 1994 and 1993 5 Notes to Consolidated Financial Statements 6 Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations 8 Part II - Other Information: Item 5 Other Information 10 Item 6 Exhibits and Reports on Form 8-K 10 Signatures 11 Exhibit Index 12 Exhibit 1 13 Exhibit 2 24 Exhibit 27 37 - 2 -
PART_I_-_FINANCIAL_INFORMATION AMPCO-PITTSBURGH_CORPORATION CONSOLIDATED_BALANCE_SHEETS (UNAUDITED) September 30, December 31, ____1994_____ ____1993____ Assets Current assets: Cash and cash equivalents $ 19,619,161 $ 9,550,420 Receivables, less allowance for doubtful accounts of $332,346 in 1994 and $281,885 in 1993 20,673,045 17,864,251 Inventories 29,933,990 28,173,446 Investments available for sale, at market in 1994 6,147,671 2,839,620 Other ___1,372,842 ___4,919,124 Total current assets 77,746,709 63,346,861 Property, plant and equipment, at cost 99,888,712 96,934,530 Accumulated depreciation _(50,803,129) _(46,346,106) Net property, plant and equipment 49,085,583 50,588,424 Prepaid pension 14,894,862 15,201,896 Other assets ___6,119,019 ___9,356,933 $147,846,173 $138,494,414 Liabilities and Shareholders' Equity Current liabilities: Current maturities of long-term debt $ 350,000 $ 783,333 Accounts payable 6,133,468 5,380,015 Accrued payrolls and employee benefits 4,948,738 5,272,877 Other ___8,709,422 ___9,127,459 Total current liabilities 20,141,628 20,563,684 Long-term debt 1,350,000 1,350,000 Other liabilities __24,503,080 __25,430,200 Total liabilities 45,994,708 47,343,884 Shareholders' equity: Preference stock - no par value; authorized 3,000,000 shares: none issued - - Common stock - par value $1; authorized 20,000,000 shares; issued and outstanding 9,577,621 in 1994 and 1993 9,577,621 9,577,621 Additional paid-in capital 102,555,980 102,555,980 Retained earnings (deficit) _(16,464,753) _(22,197,466) 95,668,848 89,936,135 Translation and other adjustments 2,455,251 1,214,095 Unrealized holding gains on securities ___3,727,366 ______-_____ Total shareholders' equity _101,851,465 __91,150,230 $147,846,173 $138,494,114
See Notes to Consolidated Financial Statements. - 3 -
AMPCO-PITTSBURGH_CORPORATION CONSOLIDATED_STATEMENTS_OF_INCOME (UNAUDITED) Nine_Months_Ended_Sept._30, _Three_Months_Ended_Sept._30, 1994 1993 1994 1993 Net sales $_84,428,496 $_81,921,467 $_27,589,907 $_23,699,768 Operating costs and expenses: Cost of products sold excluding depreciation 61,845,036 60,438,503 19,977,617 17,211,377 Selling and administrative 12,969,382 13,809,096 4,512,150 4,077,723 Depreciation ___4,124,037 ___3,999,658 ___1,367,975 ___1,306,322 __78,938,455 __78,247,257 __25,857,742 __22,595,422 Income from operations 5,490,041 3,674,210 1,732,165 1,104,346 Other income and (expense): Gain on sale of investment 2,554,294 6,489,738 226,635 - Interest expense (160,244) (857,182) (49,646) (52,086) Other income (expense) - net ____(450,942) ____(365,318) _____(66,716) _____(48,707) Income from continuing operations before provision for taxes on income 7,433,149 8,941,448 1,842,438 1,003,553 Provision for taxes on income ___2,710,000 _____340,000 _____710,000 _____100,000 Income from continuing operations 4,723,149 8,601,448 1,132,438 903,553 Discontinued operations: Loss from operations - (596,306) - - Gain (loss) on disposal, net of an income tax provision of $931,000 in 1994 ___1,728,251 _(15,490,990) _______-_____ _______-____ Net income (loss) $ 6,451,400 $ (7,485,848) $ 1,132,438 $ 903,553 Net income (loss) per common share: Continuing operations $ .49 $ .90 $ .12 $ .09 Discontinued operations _________.18 _______(1.68) ___________- ___________- Net income (loss) $ .67 $ (.78) $ .12 $ .09 Cash dividends declared per share $ .075 $ .125 $ .025 $ .025 Weighted average common shares outstanding 9,577,621 9,577,621 9,577,621 9,577,621 See Notes to Consolidated Financial Statements
- 4 -
AMPCO-PITTSBURGH_CORPORATION CONSOLIDATED_STATEMENTS_OF_CASH_FLOWS (UNAUDITED) Nine Months Ended Sept. 30, _____1994____ ____1993____ Cash flows from operating activities: Net income (loss) $ 6,451,400 $ (7,485,848) Adjustments to reconcile net income (loss) to net cash flows from operating activities: Depreciation and amortization 4,124,037 5,067,899 (Gain) on sale of investment (2,554,294) (6,489,738) (Gain) loss on disposal of discontinued operations (2,659,251) 15,490,990 Deferred income taxes 3,304,958 - Other - net 190,686 144,465 (Increase) decrease in assets: Accounts receivable (2,414,897) 2,434,931 Inventories (1,338,682) 3,483,069 Other assets 2,611,275 205,112 Increase (decrease) in liabilities: Accounts payable 627,933 (1,331,033) Accrued payrolls and employee benefits (401,892) 1,782,112 Other liabilities __(2,340,094) __(3,126,955) Net cash flows from operating activities ___5,601,179 __10,175,004 Cash flows from investing activities: Proceeds from disposal of discontinued operations 3,278,070 30,668,962 Proceeds from sales of investments 4,309,579 6,720,746 Purchases of property, plant and equipment (2,195,365) (2,046,547) Proceeds from sale of property, plant and equipment ______19,253 _____132,429 Net cash flows from investing activities ___5,411,537 __35,475,590 Cash flows from financing activities: Repayments of notes payable to bank - (13,000,000) Repayments of long-term debt (433,333) (26,046,527) Dividends paid ____(718,687) __(1,437,131) Net cash flows from financing activities __(1,152,020) _(40,483,658) Effect of exchange rate changes on cash _____208,045 _____(25,288) Net increase in cash 10,068,741 5,141,648 Cash at beginning of year ___9,550,420 ___3,566,072 Cash at end of period $ 19,619,161 $ 8,707,720 Supplemental information: Interest payments $ 158,490 $ 904,597 Income tax payments (refunds) - net 1,033,167 (222,463) See Notes to Consolidated Financial Statements.
- 5 - AMPCO-PITTSBURGH_CORPORATION NOTES_TO_CONSOLIDATED_FINANCIAL_STATEMENTS 1. Unaudited_Consolidated_Financial_Statements Certain amounts for preceding periods have been reclassified for comparability with the 1994 presentation. The condensed consolidated balance sheet as of September 30, 1994, the consolidated statements of income for the three and nine month periods ended September 30, 1994 and 1993 and the consolidated statements of cash flows for the nine month periods then ended have been prepared by the Corporation without audit. In the opinion of management, all adjustments necessary to present fairly the financial position, results of operations and cash flows for the periods presented have been made. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. It is suggested that these consolidated financial statements be read in conjunction with the consolidated financial statements and notes thereto included in the Corporation's annual report to shareholders for the year ended December 31, 1993. The results of operations for the periods ended September 30, 1994 are not necessarily indicative of the operating results for the full year. 2. Investments On April 2, 1993, Amersham International PLC (Amersham) acquired United States Biochemical Corporation (Biochem), including Ampco-Pittsburgh Corporation's investment therein. The proceeds to the Corporation were comprised of: cash $6,500,000 and common shares of Amersham valued at $2,300,000. The Corporation recorded a gain of $6,490,000 with respect to this transaction in the second quarter of 1993. In January 1994, the Corporation received a payment of $1,598,000 from Amersham, composed of cash of $814,000 and 52,466 shares of Amersham valued at $784,000 in satisfaction of a contingent purchase price in connection with their 1993 purchase of the Corporation's 20% interest in Biochem. As no value was assigned previously to the contingent purchase price, the settlement was recorded as a gain. During the second and third quarters of 1994, the Corporation sold 212,861 shares of its holdings in Amersham, realizing proceeds of $3,256,000 and a pre-tax gain of $957,000 (including $227,000 in the third quarter). The Corporation has remaining 36,726 shares of Amersham which are restricted from sale until May 1996. During the first quarter of 1994, the Corporation sold 243,500 shares of its interest in Northwestern Steel and Wire Company (Northwestern), realizing proceeds of $2,779,000 and a pre-tax gain of $2,659,000. Consistent with the previous accounting for Northwestern, this gain was reflected in discontinued operations net of a deferred tax provision of $931,000. At September 30, 1994, the Corporation owns 862,831 shares of Northwestern. - 6 - The Northwestern shares held by the Corporation have been reclassified as "available for sale" in accordance with SFAS No. 115 and reported at fair value, with the unrealized gain included in shareholders' equity. The excess of market value over carrying value of $3,727,000 at September 30, 1994, net of a deferred tax charge of $2,000,000, has been included in shareholders' equity. 3. Disposition On May 6, 1993, the Corporation sold its air handling operations in the United States, Canada and Mexico to Howden Group, PLC for a cash purchase price of $34,250,000. The transaction resulted in a loss of $15,491,000. 4. Litigation The Corporation had previously reported on litigation against it in connection with the Chapter 11 filing of Valley-Vulcan Mold Company (Valley), of which a subsidiary of the Corporation is a 50% partner. On April 4, 1994, the Bankruptcy Court issued a favorable judgment denying all claims against the Corporation. No reserve had been established for the outcome of this litigation based on the Corporation's belief that it had meritorious defenses. The plaintiff in the case, the unsecured creditors committee of Valley, has filed a notice of appeal from the Court's decision. In addition to the litigation noted above, the Corporation is from time to time subject to routine litigation incidental to its business. The Corporation believes that the results of the above noted litigation and other pending legal proceedings will not have a materially adverse effect on the Corporation's financial condition or results of operation. 5. Inventory Inventories are comprised of the following:
September 30, December 31, ____1994____ ____1993____ Raw materials $ 5,433,202 $ 4,541,169 Work-in-process 17,385,313 16,081,343 Finished goods 4,919,441 5,614,401 Supplies ___2,196,034 ___1,936,533 $ 29,933,990 $ 28,173,446
6. Provision_for_taxes_on_income The difference in tax provisions from statutory rates for 1993 were due principally to the capital gain on the sale of Biochem being more than offset by the capital loss from the sale of the air handling operations. 7. Net_Income_Per_Common_Share Net income per common share is computed on the basis of a weighted number of shares of Ampco-Pittsburgh Corporation's common stock outstanding, which has remained unchanged at 9,577,621 shares, for the periods presented. - 7 - AMPCO-PITTSBURGH_CORPORATION MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL_CONDITION_AND_RESULTS_OF_OPERATIONS Operations for the Nine and Three Month Periods_Ended_September_30,_1994_and_1993 Net sales for the nine months ended September 30, 1994 increased by $2,507,000 or 3% over 1993. Net sales for the third quarter increased by $4,013,000 or 17% compared to 1993 reflecting improved volume for all operations. The order backlog at September 30, 1994 was $59,800,000 compared with $56,200,000 at December 31, 1993 and $58,500,000 at September 30, 1993. The cost of products sold relationships for the nine and three months ended September 30, 1994 were 73.3% and 72.4%, respectively. This compares with the prior comparable periods at 73.8% and 72.6%, respectively. Year-to-date margins have improved modestly; however, further improvement was impacted by a strike at Aerofin which also resulted in a reduction in first quarter shipments and subsequent replacement of a major portion of the labor force. Aerofin is now fully operational. Selling and administrative expenses declined by $840,000 or 6% for the year-to-date period. The decline was primarily due to a combination of staff and expense reductions and increased fee income for services provided by the Corporation to others. Selling and administrative expenses increased by $434,000 or 11% for the third quarter compared to 1993 due principally to increased commissions as a result of the higher sales level. Due to the above, the income from operations was $5,490,000 and $1,732,000 for the nine and three month periods ended September 30, 1994, respectively. This compares with prior year comparable periods at $3,674,000 and $1,104,000, respectively. For a discussion on the gain on sales of investments, see Notes to Financial Statements - Note 2. Interest expense was lower in the year-to-date 1994 period due to the prepayment of bank debt in the second quarter of 1993 following the sale of the air handling group (AHG). For a discussion on the provision for taxes on income, see Notes to Financial Statements - Note 6. Discontinued operations include a gain in 1994 from the partial disposition of shares held in Northwestern Steel and Wire Company (Northwestern). (See Notes to Financial Statements - Note 2). The 1993 amounts represent the operating results and loss on sale of the AHG. As a result of all of the above, the Corporation had net income for the nine and three months ended September 30, 1994 of $6,451,000 and $1,132,000, respectively. This compares with a net loss in 1993 for the nine month period of $(7,486,000) and net income for the three month period of $904,000. - 8 - Liquidity_and_Capital_Resources Net cash flow from operating activities was positive for the nine months ended September 30, 1994 at $5,601,000 and compares with positive cash flows of $10,175,000 for the comparable period 1993. Net cash outflow for working capital changes and payments associated with discontinued operations was $3,256,000 in 1994 compared to net cash inflows of $3,447,000 in 1993. The 1994 net cash outflow reflects an increased level of trade receivables compared to 1993 due to the increased sales activity in the third quarter. The 1993 net cash inflow included a reduction in working capital for the air handling operations prior to sale. Net cash flow from operating activities in 1994 includes a recovery of $2,200,000 from the Chapter 11 estate of Valley-Vulcan Mold Company in connection with the Corporation's lien in respect of a previously paid industrial revenue bond guarantee. (See Notes to Financial Statements - Note 4. The net cash inflow for investing activities in 1994 includes proceeds from the sale of Amersham and Northwestern shares and the contingent purchase price receipt from Amersham. Capital expenditures for 1994 totaled $2,195,000 compared to $2,047,000 in 1993. Capital appropriations carried forward from September 30, 1994 total $1,452,000. Capital requirements are expected to be financed from funds internally generated. The Corporation maintains short-term lines of credit and a revolving credit agreement in excess of the cash needs of its businesses. The total available at September 30, 1994 was $22,000,000. At September 30, 1994, the Corporation owned 862,831 shares of Northwestern which had a market value of $6,148,000. The Corporation intends to sell its shares in Northwestern in an orderly manner, depending on market conditions. The Corporation also owned 36,726 shares of Amersham which are restricted from sale until May 1996. With respect to environmental concerns, the Corporation has been named a potentially responsible party at several sites by federal, state and local authorities. The Corporation has accrued for costs of remedial actions it would likely be required to take. In addition, the Corporation has provided for environmental clean-up costs related to preparing its discontinued business facilities for sale. While it is not possible to quantify with certainty the potential of actions regarding environmental matters, particularly any future remediation and other compliance efforts, in the opinion of management, compliance with the present environmental protection laws will not have a material adverse effect on the financial condition or results of operations of the Corporation. - 9 - PART_II_-_OTHER_INFORMATION AMPCO-PITTSBURGH_CORPORATION Items 1-4 None Item 5 Other_Information On September 8, 1994, Marshall L. Berkman, Chairman and Chief Executive Officer, and Ronald L. Cale, Manager of Tax, died as a result of the crash of U.S. Air Flight 427. On September 20, 1994, the Board of Directors elected Louis Berkman as Chairman of the Board, Robert A. Paul as President and Chief Executive Officer, Ernest G. Siddons as Executive Vice President and Chief Operating Officer, and Robert J. Reilly as Treasurer and Controller. Winifred Jones was named Manager of Tax. Item 6 Exhibits and Reports on Form 8-K (a) Exhibits 1. Amended and Restated by-laws (3) 2. Category 1 Severance Agreement between Ampco-Pittsburgh Corporation and Louis Berkman (10) 27. Financial Data Schedule (b) Reports on Form 8-K None - 10 - 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. AMPCO-PITTSBURGH CORPORATION DATE: November_11,_1994 BY:s/Robert_A._Paul_____________ Robert A. Paul President and Chief Executive Officer DATE: November_11,_1994 BY:s/Ernest_G._Siddons__________ Ernest G. Siddons Executive Vice President and Chief Operating Officer - 11 - AMPCO-PITTSBURGH_CORPORATION EXHIBIT_INDEX Page_No. Exhibit 1 - Amended and restated by-laws (3) 13 of 37 pages Exhibit 2 - Category I Severance Agreement between 24 of 37 pages Ampco-Pittsburgh Corporation and Louis Berkman (10) Exhibit 27 - Financial Data Schedule (FDS) 37 of 37 pages - 12 - EX-1 2 Effective 9/20/94. Amended and Restated By-laws of Ampco-Pittsburgh Corporation Incorporated under the Laws of Pennsylvania Amended and Restated By-laws of Ampco-Pittsburgh Corporation Incorporated under the Laws of Pennsylvania ARTICLE I SHAREHOLDERS SECTION 1. Annual Meeting. An annual meeting of shareholders for the election of directors and the transaction of such other business as may properly come before the meeting shall be held on the fourth Tuesday in April of each year, at 10:00 a.m., prevailing time, or at such other hour as the Board of Directors may designate, or on such other day and at such hour as the Board of Directors may designate. If the day fixed for the meeting is a legal holiday, the meeting shall be held at the same hour on the next succeeding full business day which is not a legal holiday. SECTION 2. Special Meetings. Special meetings of shareholders may be called at any time by the Chairman of the Board, the President, or a majority of the directors in office. Upon written request of any person or persons who shall have duly called a special meeting, it shall be the duty of the Secretary to fix the date and hour of the meeting, to be held not more than sixty days after the receipt of the request. SECTION 3. Place. Each annual or special meeting of shareholders shall be held at the principal office of the Corporation or at such other place in Pennsylvania or elsewhere as the Board of Directors or the person calling the meeting may designate. SECTION 4. Notice. Written notice stating the place, day and hour of each meeting of shareholders and, in the case of a special meeting, the general nature of the business to be transacted, shall be mailed by the Secretary at least ten days before the meeting to each shareholder of record entitled to vote at the meeting to his address appearing on the books of the Corporation or supplied by him to the Corporation for the purpose of notice. SECTION 5. Quorum. The presence, in person or by proxy, of shareholders entitled to cast at least a majority of the votes which all shareholders are entitled to cast on a particular matter shall constitute a quorum for the purpose of considering such matter at a meeting of shareholders. If a quorum is not present in person or by proxy, those present may adjourn from time to time to reconvene at such time and place as they may determine. In the case of a meeting called for the election of directors, those present in person or by proxy at the second of such adjourned meetings, although less than a quorum for any other purpose, shall nevertheless constitute a quorum for the purpose of electing directors at such second adjourned meeting. SECTION 6. Voting. Shareholders shall be entitled to one vote for each share of stock owned by them on the books of the Corporation and entitled to vote at the particular meeting when the shareholder is present, either in person or by duly authorized proxy. Shareholders shall be entitled to cumulative voting rights in accordance with the Pennsylvania Business Corporation Law. SECTION 7. Record Dates. The Board of Directors may fix a time not more than fifty days prior to the date of any meeting of shareholders, or the date fixed for the payment of any dividend or distribution, or the date for the allotment of rights, or the date when any change or conversion or exchange of shares will be made or go into effect, as a record date for the determination of the shareholders entitled to notice of or to vote at any such meeting, or to receive payment of any such dividend or distribution, or to receive any such allotment of rights, or to exercise the rights in respect to any such change, conversion or exchange of shares. In such case, only such shareholders as shall be shareholders of record at the close of business on the date so fixed shall be entitled to notice of or to vote at such meeting, or to receive payment of such dividend or distribution, or to receive such allotment of rights, or to exercise such rights in respect to any change, conversion or exchange of shares as the case may be, notwithstanding any transfer of any shares on the books of the Corporation after the record date fixed as aforesaid. ARTICLE II DIRECTORS SECTION 1. Number and Terms. The business and affairs of the Corporation shall be managed by a Board of Directors, which shall have the number of members set forth in the Articles of Incorporation of the Corporation. The Directors of the Corporation shall serve for such terms as shall be specified in the Articles of Incorporation. SECTION 2. Vacancies. Vacancies in the Board of Directors, including vacancies resulting from an increase in the number of directors, shall be filled in the manner specified in the Articles of Incorporation. SECTION 3. Annual Meeting. An annual meeting of the Board of Directors shall be held each year as soon as practicable after the annual meeting of shareholders, at the place where such meeting of shareholders was held or at such other place as the Board may determine, for the purposes of organization, election or appointment of officers and the transaction of such other business as shall come before the meeting. No notice of the meeting need be given. SECTION 4. Regular Meetings. Regular meetings of the Board of Directors may be held without notice at such times and at such places in Pennsylvania or elsewhere as the Board may determine. SECTION 5. Special Meetings. Special meetings of the Board of Directors may be called by the Chairman of the Board, the President or a majority of the directors in office, to be held at such time (as will permit the giving of notice as provided in this section) and at such place in Pennsylvania or elsewhere as may be designated by the person or persons calling the meeting. Notice of the place, day and hour of such special meeting shall be given to each director by the Secretary by written notice mailed on or before the third full business day before the meeting or by telegraph, telephone or oral notice received personally at least 24 hours before the meeting. The notice need not refer to the business to be transacted at the meeting except action under Article VII of the By-laws. SECTION 6. Quorum. A majority of the directors in office shall constitute a quorum for the transaction of business but less than a quorum may adjourn from time to time to reconvene at such time and place as they may determine. SECTION 7. Compensation. Directors shall receive such compensation for their services as shall be determined by the Board of Directors. SECTION 8. Committees. The Board of Directors may, by resolution adopted by a majority of the directors then in office, appoint an Executive Committee of three or more directors. To the extent provided in such resolution, the Executive Committee shall have and may exercise the authority of the Board in the management of the business of the Corporation. The Board may appoint such other committees as it may deem advisable, and each such committee shall have such authority and perform such duties as the Board may determine. At each meeting of the Board, all action taken by each committee since the preceding meeting of the Board shall be reported to it. SECTION 9. Remote Participation in Meetings. One or more director may participate in a meeting of the Board or any committee thereof by means of a conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other. SECTION 10. Consent Action. Any action which may be taken at a meeting of the directors or the members of the Executive Committee or any other committee may be taken without a meeting, if a consent or consents in writing, setting forth the action so taken, shall be signed by all of the directors or the members of the particular committee, as the case may be, and shall be filed with the Secretary of the Corporation. SECTION 11. Limit on Liability. (a) To the fullest extent that the laws of the Commonwealth of Pennsylvania, as in effect on January 27, 1987, or as thereafter amended, permit elimination or limitation of the liability of directors, no director of the Corporation shall be personally liable for monetary damages as such for any action taken, or any failure to take any action, as a director. (b) This Section 11 shall not apply to any actions filed prior to January 27, 1987, nor to any breach of performance of duty or any failure of performance of duty by any director of the Corporation occurring prior to January 27, 1987. (c) The provisions of this Section 11 shall be deemed to be a contract with each director of the Corporation who serves as such at any time while this Section 11 is in effect and each such director shall be deemed to be doing so in reliance on the provisions of this Section 11. Any amendment or repeal of this Section 11 or adoption of any other by-law or provision of the Articles of Incorporation, which has the effect of increasing director liability, shall operate prospectively only and shall not affect any action taken, or any failure to act, prior to the adoption of such amendment, repeal, other by-law or provision. ARTICLE III OFFICERS AND AGENTS SECTION 1. Officers. The Board of Directors at any time may elect a Chairman of the Board, a President, one or more Vice Presidents, a Treasurer and a Secretary. It may designate any one or more Vice Presidents as Executive Vice Presidents, Senior Vice Presidents, Financial Vice Presidents or otherwise, and may elect or appoint such additional officers and agents as the Board may deem advisable. Any two or more offices may be held by the same person except the offices of Chairman of the Board and Secretary and the offices of President and Secretary. SECTION 2. Term. Each officer and each agent shall hold office until his successor is elected or appointed and qualified or until his death, resignation or removal by the Board of Directors. SECTION 3. Authority, Duties and Compensation. All elected or appointed officers and agents shall have such authority and perform such duties as may be provided in the By-laws or as may be determined by the Board of Directors or the Chairman of the Board. They shall receive such compensation for their services as may be determined by the Board of Directors or in a manner approved by it. Notwithstanding any other provisions of these By-laws, the Board shall have power from time to time by resolution to prescribe by what officers or agents particular documents or instruments or particular classes of documents or instruments shall be signed, countersigned, endorsed or executed, provided, however, that any person, firm or corporation shall be entitled to accept and to act upon any document or instrument signed, countersigned, endorsed or executed by officers or agents of the Corporation pursuant to the provisions of these By-laws unless prior to receipt of such document or instrument such person, firm or corporation has been furnished with a certified copy of a resolution of the Board prescribing a different signature, countersignature, endorsement or execution. SECTION 4. Chairman of the Board. The Chairman of the Board shall preside at all meetings of the Board of Directors and Executive Committee. The Chairman of the Board shall sign all certificates of stock of the Corporation or cause them to be signed in facsimile or otherwise as permitted by law. SECTION 5. President. The President shall be the principal officer of the Corporation and shall be charged with and have the direction and supervision of its business and operations as shall from time to time be established by the Board of Directors. The President shall preside at all meetings of shareholders. In the absence of the Chairman of the Board, the President shall preside at all meetings of the Board of Directors. SECTION 6. Treasurer. The Treasurer shall keep and account for all moneys, funds and property of the Corporation which shall come into his hands, and shall render such accounts and present such statements to the Board of Directors as may be required of him. Unless the Board shall prescribe otherwise, the Treasurer shall deposit all funds of the Corporation which may come into his hands in such bank or banks as the Board may designate and in accounts in the name of the Corporation, shall endorse for collection bills, notes, checks and other negotiable instruments received by the Corporation, shall sign all checks and other negotiable instruments of the Corporation or cause them to be signed in facsimile or otherwise as the Board may determine, shall countersign all certificates of stock of the Corporation or cause them to be countersigned in facsimile or otherwise as permitted by law, and shall pay out money as the business of the Corporation may require, taking proper vouchers therefor. In the absence or disability of the Treasurer, an Assistant Treasurer shall have the authority and perform the duties of the Treasurer. SECTION 7. Secretary. The Secretary shall give or cause to be given all required notices of meetings of shareholders and of the Board of Directors, shall attend such meetings when practicable, shall record and keep the minutes and all other proceedings thereof, shall attest such records after every meeting by his signature, shall safely keep all documents and papers which shall come into his possession, shall truly keep the books and records of the Corporation appertaining to his office, and shall present statements thereof when required by the Board. The Secretary shall have custody of the corporate seal, which seal or a facsimile thereof may be impressed, affixed or reproduced, and attested by the Secretary for the authentication of documents or instruments requiring the seal and bearing the signature of a duly authorized officer or agent. In the absence or disability of the Secretary, an Assistant Secretary shall have the authority and perform the duties of the Secretary. ARTICLE IV INDEMNIFICATION OF DIRECTORS, OFFICERS AND OTHER PERSONS SECTION 1. Right to Indemnification. Except as prohibited by law and as set forth below, every director and officer of the Corporation shall be entitled as of right to be indemnified by the Corporation against expenses and any liability paid or incurred by such person in connection with any actual or threatened claim, action, suit or proceeding, whether civil, criminal, administrative, investigative or other, whether brought by or in the right of the Corporation or otherwise, in which such person may be involved, as a party, witness or otherwise, or is threatened to be involved by reason of such person being or having been a director or officer of the Corporation or by reason of the fact that such person is or was serving at the request of the Corporation as a director, officer, employee, fiduciary agent, or other representative of another corporation, partnership, joint venture, trust, employee benefit plan or other entity (such claim, action, suit or proceeding hereinafter being referred to as an "Action"); provided, that no such right of indemnification shall exist in any case where the act or failure to act giving rise to the claim to indemnification is determined by a court to have constituted willful misconduct or recklessness, and provided further, that no such right of indemnification shall exist with respect to an Action brought by a director or officer against the Corporation except as provided in the last sentence of this Section 1. Indemnification hereunder shall include the right to have expenses incurred by such person in connection with defending a civil or criminal Action paid by the Corporation in advance of the final disposition of such Action upon receipt of an undertaking by or on behalf of such person to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by the Corporation. Persons who are not directors or officers of the Corporation may be similarly indemnified in respect of service to the Corporation or to another such entity at the request of the Corporation to the extent the Board of Directors at any time denominates such person as entitled to the benefits of this Section 1. Any director or officer of the Corporation serving (i) another corporation, of which a majority of the shares entitled to vote in the election of its directors is held by the Corporation, or (ii) any employee benefit plan of the Corporation or any corporation referred to in clause (i), in any capacity, shall be deemed to be doing so at the request of the Corporation. As used herein, "expenses" shall include fees and expenses of counsel selected by such person and "liability" shall include amounts of judgments, excise taxes, fines and penalties, and amounts paid in settlement (with the written consent of the Corporation, which consent shall not be unreasonably withheld). With respect to any Action brought by a director or officer against the Corporation, the director or officer shall be entitled to be indemnified for expenses incurred in connection with such Action pursuant to this Section only (a) if the Action is a suit brought as a claim for indemnity under Section 2 of this Article IV or otherwise, (b) if the director or officer is successful in whole or in part in the Action for which expenses are claimed, or (c) if the indemnification for expenses is included in a settlement of the Action or is awarded by a court. SECTION 2. Right of Claimant to Bring Suit. If a claim under Section 1 of this Article IV is not paid in full by the Corporation within thirty days after a written claim has been received by the Corporation, the claimant may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim, and, if successful in whole or in part, the claimant shall also be entitled to be paid the expense of prosecuting such claim. It shall be a defense to any such suit that the claimant's conduct was such that under Pennsylvania law the Corporation is prohibited from indemnifying the claimant for the amount claimed, but the burden of proving such defense shall be on the Corporation. Neither the failure of the Corporation (including its Board of Directors, independent legal counsel or its shareholders) to have made a determination prior to the commencement of such suit that indemnification of the claimant is proper in the circumstances, nor an actual determination by the Corporation (including its Board of Directors, independent legal counsel or its shareholders) that the claimant's conduct was such that indemnification is prohibited by law, shall be a defense to the suit or create a presumption that the claimant's conduct was such that indemnification is prohibited by law. SECTION 3. Insurance and Funding. The Corporation may purchase and maintain insurance to protect itself and any person eligible to be indemnified hereunder against any liability or expense asserted or incurred by such person in connection with any Action, whether or not the Corporation would have the power to indemnify such person against such liability or expense by law or under the provisions of this Article IV. The Corporation may create a trust fund, grant a security interest, cause a letter of credit to be issued or use other means (whether or not similar to the foregoing) to ensure the payment of such sums as may become necessary to effect indemnification as provided herein. SECTION 4. Non-Exclusivity; Nature and Extent of Rights. The right of indemnification and advancement of expenses provided for in this Article IV (i) shall not be deemed exclusive of any other rights, whether now existing or hereafter created, to which those seeking indemnification hereunder may be entitled under any agreement, by-law or charter provision, vote of shareholders or directors or otherwise, (ii) shall be deemed to create contractual rights in favor of persons entitled to indemnification hereunder, and (iii) shall continue as to persons who have ceased to have the status pursuant to which they were entitled or were denominated as entitled to indemnification hereunder and shall inure to the benefit of the heirs, executors and administrators of persons entitled to indemnification hereunder. The right of indemnification provided for herein may not be amended or repealed so as to limit in any way the indemnification provided for herein with respect to any acts or omissions occurring prior to the adoption of any such amendment or repeal. SECTION 5. Applicable Law. Any person entitled to be indemnified or to the reimbursement or the advancement of expenses as a matter of right pursuant to this Article IV may elect to have the right to indemnification (or advancement of expenses) interpreted on the basis of the applicable law in effect at the time of the occurrence of the event or events giving rise to the Action, to the extent permitted by law, or on the basis of the applicable law in effect at the time indemnification is sought. SECTION 6. Effective Date. This Article IV shall apply to every Action other than an Action filed prior to January 27, 1987, except that it shall not apply to the extent that Pennsylvania law does not permit its application to any breach of performance of duty by any person eligible to be indemnified hereunder occurring prior to January 27, 1987. Article IV of these By-laws, as in effect prior to the adoption of this Article IV, shall continue to remain in full force and effect for all Actions that are not covered by this Article IV. ARTICLE V FISCAL YEAR AND ANNUAL REPORT SECTION 1. Fiscal Year. The fiscal year of the Corporation shall be the calendar year. SECTION 2. Annual Report. The Board of Directors shall cause a report to be mailed to the shareholders as soon as practicable after the close of each fiscal year. The report shall include financial statements showing the financial position of the Corporation and its subsidiaries at the end of the fiscal year and the results of their operations for the year. Such financial statements shall be examined by independent public accountants appointed for the purpose by the Board and shall be accompanied by such accountants' opinion with respect thereto. ARTICLE VI SHARE TRANSFERS AND RECORDS The Board of Directors may appoint a transfer agent or transfer agents and a registrar or registrars to make and record all transfers of shares of stock of the Corporation of any class. Each transfer agent shall prepare transfer records showing transfers made through the office of such agent. A share register shall be kept at the registered office of the Corporation. Such share register shall constitute books of the Corporation with respect to shares of stock of any class and the holders of record thereof, provided that the Board of Directors may designate instead as the books of the Corporation for this purpose a share register kept at the office of a transfer agent or registrar. If the Board of Directors shall have appointed a transfer agent or transfer agents and a registrar or registrars for stock of any class, transfers of stock of such class shall be made by such transfer agent or transfer agents at their offices and shall be recorded in their books and in the books of the registrar or registrars. In case of loss, destruction or theft of a certificate of stock, another may be issued in lieu thereof in such manner and upon such terms as the Board of Directors shall authorize. ARTICLE VII AMENDMENT OF BY-LAWS Except as otherwise provided in the Articles of Incorporation of the Corporation, these By-laws may be altered or amended by a vote of a majority of the members of the Board of Directors at any regular or special meeting duly convened after notice of that purpose; subject, however, to the power of the shareholders, as set forth in the Articles of Incorporation, to change or repeal the By-laws at any annual or special meeting duly convened after notice of that purpose. ARTICLE VIII EMERGENCY BY-LAWS SECTION 1. When Operative. The emergency By-laws provided by the following sections shall be operative during any emergency resulting from warlike damage or an attack on the United States or any nuclear or atomic disaster, notwithstanding any different provision in the preceding articles of the By-laws or in the Articles of Incorporation of the Corporation or in the Pennsylvania Business Corporation Law. To the extent not inconsistent with the emergency By-laws, the By-laws provided in the preceding articles shall remain in effect during such emergency and upon the termination of such emergency the emergency By-laws shall cease to be operative unless and until another such emergency shall occur. SECTION 2. Meetings. During any such emergency: (a) Any meeting of the Board of Directors may be called by any director. Whenever any officer of the Corporation who is not a director has reason to believe that no director is available to participate in a meeting, such officer may call a meeting to be held under the provisions of this section. (b) Notice of each meeting called under the provisions of this section shall be given by the person calling the meeting or at his request by any officer of the Corporation. The notice shall specify the time and the place of the meeting, which shall be the head office of the Corporation, if feasible, and otherwise any other place specified in the notice. Notice need be given only to such of the directors as it may be feasible to reach at the time and may be given by such means as may be feasible at the time, including publication or radio. If given by mail, messenger, telephone or telegram, the notice shall be addressed to the director at his residence or business address or such other place as the person giving the notice shall deem suitable. In the case of meetings called by an officer who is not a director, notice shall also be given similarly, to the extent feasible, to the persons named on the list referred to in part (c) of this section. Notice shall be given at least two days before the meeting if feasible in the judgment of the person giving the notice and otherwise the meeting may be held on any shorter notice he shall deem suitable. (c) At any meeting called under the provisions of this section, the director or directors present shall constitute a quorum for the transaction of business. If no director attends a meeting called by an officer who is not a director and if there are present at least three of the persons named on a numbered list of personnel approved by the Board of Directors before the emergency, those present (but not more than the nine appearing highest in priority on such list) shall be deemed directors for such meeting and shall constitute a quorum for the transaction of business. SECTION 3. Lines of Succession. The Board of Directors, during as well as before any such emergency, may provide, and from time to time modify, lines of succession in the event that during such an emergency any or all officers or agents of the Corporation shall for any reason be rendered incapable of discharging their duties. SECTION 4. Offices. The Board of Directors, during as well as before any such emergency, may, effective in the emergency, change the head office or designate several alternative head offices or regional offices, or authorize the officers so to do. SECTION 5. Liability. No officer, director or employee acting in accordance with these emergency By-laws shall be liable to the Corporation or any shareholder thereof, except for willful misconduct. SECTION 6. Repeal or Change. The emergency By-laws shall be subject to repeal or change by action of the Board of Directors or by action of the shareholders, except that no such repeal or change shall modify the provisions of Section 5 with regard to action or inaction prior to the time of such repeal or change. ARTICLE IX NON-APPLICABILITY OF STATUTE Subchapter E of Chapter of the Pennsylvania 1988 Business Corporation Law (formerly known as Section 910 of the Pennsylvania Business Corporation Law) shall not be applicable to the Corporation. (This By-Law provision was adopted by action of the Board of Directors on February 28, 1984, and may not be rescinded except by an Amendment to the Articles of the Corporation.) Subchapters G and H of Chapter 25 of the Pennsylvania 1988 Business Corporation Law shall not be applicable to the Corporation. (This By-Law provision was adopted by action of the Board of Directors on July 20, 1990.) EX-2 3 September 20, 1994 Mr. Louis Berkman 433 Braybarton Boulevard Steubenville, Ohio 43952 Dear Louis: Ampco-Pittsburgh Corporation (the "Corporation") recognizes that your contribution to the success of the Corporation has been substantial and desires to assure the Corporation of your continued employment. In this connection, the Board of Directors of the Corporation (the "Board") recognizes that, as is the case with other publicly held corporations, the possibility of a change in control may exist and that such possibility, and the uncertainty that it may raise among the Corporation's management, may result in the departure or distraction of management personnel to the detriment of the Corporation and its stockholders. The Board has determined that appropriate steps should be taken to reinforce and encourage the continued attention and dedication of members of the Corporation's management, including yourself, to their assigned duties without distraction in the face of potentially disturbing circumstances arising from the possibility of a change in control of the Corporation. In order to induce you to remain in the employ of the Corporation, the Corporation agrees that you shall receive the severance benefits set forth in this letter agreement ("Agreement") in the event your employment with the Corporation is terminated subsequent to a "Change in Control" (as defined in Section 2 hereof) under the circumstances described below. 1. Term_of_Agreement. This Agreement will commence on the date hereof and shall continue in effect for twenty-four (24) months from the date hereof; provided, however, that commencing on September 20, 1996 and on each anniversary thereafter, the term of this Agreement shall automatically be extended for one additional year unless, not later than thirty (30) days prior to such date, the Corporation shall have given notice that it does not wish to extend this Agreement; provided, further, however, that if a Change in Control shall have occurred during the original or extended term of this Agreement, this Agreement cannot be cancelled. 2. Change_in_Control. (a) No benefits shall be payable hereunder unless there shall have been a Change in Control as set forth below. For purposes of this Agreement, a "Change in Control" shall be deemed to have occurred if: (i) any "person" (as defined in Sections 13(d) and 14(d) of the Exchange Act) other than the persons or the group of persons in control of the Corporation on the date hereof is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Corporation representing fifty percent (50%) or more of the combined voting power of the Corporation's then outstanding securities; (ii) within any period of two consecutive years (not including any period prior to the execution of this Agreement) there shall cease to be a majority of the Board comprised as follows: individuals who at the beginning of such period constitute the Board and any new director(s) whose election was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved; (iii) the shareholders of the Corporation approve a merger of, or consolidation involving, the Corporation in which (A) the Corporation's Common Stock, par value $1.00 per share (such stock, or any other securities of the Corporation into which such stock shall have been converted through a reincorporation, recapitalization or similar transaction, hereinafter called "Common Stock of the Corporation"), is converted into shares or securities of another corporation, or into cash or other property, or (B) the Common Stock of the Corporation is not converted as described in Clause (A), but in which more than forty percent (40%) of the Common Stock of the surviving corporation in the merger is owned by Shareholders other than those who owned such amount prior to the merger; or any other transaction after which the Corporation's Common Stock is no longer to be publicly traded; in each case, other than a transaction solely for the purpose of reincorporating the Corporation in another jurisdiction or recapitalizing the Common Stock of the Corporation; or (iv) the shareholders of the Corporation approve a plan of complete liquidation of the Corporation, or an agreement for the sale or disposition by the Corporation of all or substantially all the Corporation's assets, either of which is followed by a distribution of all or substantially all of the proceeds to the shareholders. 3. Agreement_of_Employee. You agree that in the event of a Potential Change in Control of the Corporation, you will not terminate employment with the Corporation for any reason until the occurrence of a Change in Control of the Corporation. For purposes of this Agreement, a "Potential Change in Control of the Corporation" shall be deemed to have occurred if (i) the Corporation enters into an agreement, the consummation of which would result in the occurrence of a Change in Control, (ii) any person (including the Corporation) publicly announces an intention to take or to consider taking actions, which if consummated would constitute a Change in Control, or (iii) the Board adopts a resolution to the effect that, for purposes of this Agreement, a Potential Change in Control of the Corporation has occurred. 4. Termination_Following_a_Change_in_Control. (a) If any of the events described in Section 2 constituting a Change in Control shall have occurred, you shall be entitled to the benefits provided in Section 5(d) upon the termination of your employment within twenty-four (24) months after the Change in Control has occurred, or pursuant to Section 6 prior to the Change in Control, unless such termination is (i) because of your death or Disability, (ii) by the Corporation for Cause, or (iii) by you other than for Good Reason. (b) For purposes of this Agreement, "Disability" shall mean that if, as a result of your incapacity due to physical or mental illness, you shall have been absent from the full-time performance of your duties with the Corporation for six (6) consecutive months, and within thirty (30) days after written notice of termination shall have been given to you, you shall not have returned to the full-time performance of your duties. (c) For purposes of this Agreement, termination by the Corporation of your employment for "Cause" shall mean termination upon: (i) the willful and continued failure by you to substantially perform duties consistent with your position with the Corporation (other than any such failure resulting from incapacity due to physical or mental illness or termination by you for Good Reason), after a demand for substantial performance is delivered to you by the Board, together with a copy of the resolution of the Board that specifically identifies the manner in which the Board believes that you have not substantially performed your duties, which resolution must be passed by at least two-thirds (2/3) of the entire Board at a meeting called for the purpose and after an opportunity for you and your counsel to be heard by the Board, and you have failed to resume substantial performance of your duties on a continuous basis within fourteen (14) days of receiving such demand, (ii) the willful engaging by you in conduct that is demonstrably and materially injurious to the Corporation, monetarily or otherwise, as set forth in a resolution of the Board, which resolution must be passed by at least two-thirds (2/3) of the entire Board at a meeting called for the purpose and after an opportunity for you and your counsel to be heard by the Board, or (iii) your conviction of a felony, or conviction of a misdemeanor involving assets of the Corporation. For purposes of this Section 4(c), no act, or failure to act, on your part shall be deemed "willful" unless done, or omitted to be done, by you not in good faith and without reasonable belief that your action or omission was in the best interest of the Corporation. (d) For purposes of this Agreement, "Good Reason" shall mean, without your express written consent, the occurrence after a Change in Control of any one or more of the following: (i) If, following a Change in Control, there is no Parent Corporation and your status as Chairman of the Board of the Corporation shall not continue after such Change in Control or, if following a Change in Control, there is a Parent Corporation, as defined below, you shall not be Chairman of the Board of the Parent Corporation, or, in either case, you shall not be afforded the authority, responsibilities and prerogatives of such position and report directly to the Board of Directors of the Corporation or the Parent Corporation, as the case may be; (ii) a reduction by the Corporation in your base salary as in effect immediately before the Change in Control, a failure to increase such base salary at the same intervals as prevailed before the Change in Control in an amount at least equal to the same percentage increase as the last increase prior to the Change in Control, or a reduction in bonus after the Change in Control over the last bonus paid before the Change in Control unless there are equivalent reductions in bonuses for all executives of the Corporation; (iii) the requirement that you be based at a location in excess of twenty-five (25) miles from the location where you are currently based; (iv) the failure by the Corporation to continue in effect any of the Corporation's employee benefit plans, policies, practices or arrangements in which you participate or under which you are entitled to benefits, or the failure by the Corporation to continue your participation therein or benefits thereunder on substantially the same basis, both in terms of the amount of benefits provided and the level of your participation relative to other participants, as existed immediately prior to the Change in Control; or (v) the failure of the Corporation to obtain a satisfactory agreement from any successor to the Corporation to assume and agree to perform this Agreement, as contemplated in Section 7. (e) For purposes of this Agreement, "Parent Corporation" shall mean any "affiliate" of the Corporation that is the ultimate controlling entity of the Corporation or its successor and shall include, without limiting the generality of the foregoing, any entity (and affiliated persons and entities) that beneficially owns, directly or indirectly, fifty percent (50%) or more of the combined voting power of the then outstanding voting stock of the Corporation, or any entity that beneficially owns, directly or indirectly, forty percent (40%) or more (but less than fifty percent (50%) of the combined voting power of the then outstanding voting stock of the Corporation if such entity (or affiliated persons or entities) has at least one representative on the Board of Directors of the Corporation. (f) "Good Reason" may be established notwithstanding your possible incapacity due to physical or mental illness, provided that Disability has not been established pursuant to Section 4(b). Your continued employment following the Change in Control shall not constitute a waiver of any rights hereunder including, but not limited to, rights with respect to any circumstance constituting Good Reason or rights under Section 7. 5. Compensation_Upon_Termination_or_During_Incapacity. Following a Change in Control, upon termination of your employment, or during a period of incapacity but before termination for Disability, you shall be entitled to the following benefits: (a) During any period prior to termination for Disability in which you fail to perform your full-time duties with the Corporation as a result of incapacity due to physical or mental illness, you shall continue to receive your Base Salary at the rate in effect at the commencement of any such period. Following termination for Disability, your benefits shall be determined in accordance with the Corporation's retirement, insurance and other applicable programs and plans then in effect. (b) If your employment shall be terminated by the Corporation for Cause or by you other than for Good Reason, the Corporation shall pay to you your full Base Salary through the date of termination of your employment at the rate then in effect, plus all other amounts to which you are entitled under any compensation or benefit plans of the Corporation at the time such amounts are due, and the Corporation shall have no further obligations to you under this Agreement. (c) If your employment terminates by reason of your death, your benefits shall be determined in accordance with the Corporation's retirement, survivor's benefits, insurance and other applicable programs and plans then in effect. (d) If your employment by the Corporation shall be terminated within twenty-four (24) months after the Change in Control, unless such termination is (i) by the Corporation for Cause, (ii) because of your death or Disability, or (iii) by you other than for Good Reason, you shall be entitled to the following benefits (the "Severance Payments"): (A) the Corporation shall pay to you your full Base Salary through the date of termination of your employment at the rate then in effect; (B) the Corporation shall pay to you, as severance benefits, a lump sum severance payment equal to the sum of (i) five times your annual base salary either at the time of the Change in Control or at termination, whichever is higher, and (ii) five times your bonus paid for the prior year; (C) in lieu of shares of common stock of the Corporation ("Shares") issuable upon exercise of outstanding options ("Options"), if any, granted to you under an option program or plan as may be in effect from time to time (which Options shall be cancelled upon the making of the payment referred to below), you shall receive an amount in cash equal to the product of (i) the higher of the closing price per Share as reported on the New York Stock Exchange on the date of termination of your employment or the highest price per Share actually paid in connection with any Change in Control,over the exercise price per Share of each Option held by you, times (ii) the number of Shares covered by each such Option; (D) for a thirty-six (36) month period after such termination, the Corporation will arrange to provide you at the Corporation's expense with benefits under the Corporations health, dental, disability, life insurance, and other similar plans, or benefits substantially similar to the benefits you were receiving under such plans immediately prior to the termination of your employment; (E) all benefits payable to you under the Plan at the time of such termination, in accordance with the terms and provisions of the Plan; (F) the opportunity to purchase the leased company car, if one has been assigned to you, at its then book value under the Corporation's leasing arrangements; and (G) at the expense of the Corporation, office space and secretarial services, both at the level provided to you immediately prior to the Change in Control or your termination, whichever is higher, for twelve (12) months following such termination. (e) If any payments made to or in respect of you under this Agreement, or otherwise in respect of your employment by the Corporation, become subject to the excise tax described in Section 4999 of the Internal Revenue Code of 1986, as amended (the "Code"), the Corporation will pay to you a special payment sufficient, on an after-tax basis (taking into account federal, state and local taxes and related interest and penalties), to put you (and, in the event of your death, the beneficiary of any such payments) in the same position you (or such beneficiary) would have enjoyed had such excise tax not been applicable to any of such payments. (f) The payments provided for in Sections 5(d) and (e) shall be made not later than the fifth day following your termination pursuant to the provisions of Section 5(d); provided, however, that if the amounts of such payments cannot be finally determined on or before such day, the Corporation shall pay to you on such day an estimate as determined in good faith by the Corporation of the minimum amount of such payments and shall pay the remainder of such payments (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code) as soon as the amount thereof can be determined, but in no event later than the thirtieth day after the date of such termination. If the amount of the estimated payments exceeds the amount subsequently determined to have been due, such excess shall constitute a loan by the Corporation to you payable on the fifth day after demand by the Corporation (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code). (g) The Corporation shall also pay to you all legal fees and expenses incurred by you as a result of such termination of your employment (including all such fees and expenses, if any, incurred in contesting or disputing any such termination or in seeking to obtain or enforce any right or benefit provided by this Agreement or in connection with any tax audit or proceeding to the extent attributable to the application of Section 4999 of the Code to any payment or benefit provided hereunder). (h) You shall not be required to mitigate the amount of any payment provided for in this Agreement by seeking other employment or otherwise, nor shall the amount of any payment provided for in this Agreement be reduced by any compensation earned by you as the result of employment by another employer after the date of termination of your employment, or otherwise. 6. Termination_Before_a_Change_in_Control. Notwithstanding any other provisions of this Agreement, if prior to a Change in Control there has been any statement made by the person (or an affiliate of such person) involved in such Change in Control to the effect that following such Change in Control any action will or may be taken that would have the effect of permitting you following a Change in Control to terminate your employment for Good Reason, in any proxy statement or other proxy soliciting materials, any tender offer, exchange offer, or prospectus or any other document or press release publicly issued or filed with the Securities and Exchange Commission or other governmental agency in connection with the contemplated Change in Control (including any such documents issued by the Corporation in which such statement is reported), then you shall have the right to notify the Corporation that you intend to terminate your employment as of the effective date of the Change in Control, in which case you shall be entitled to receive the payments due under Section 5 on the later of (i) five (5) business days before the contemplated effective date of the Change in Control or (ii) the date of your notice to the Corporation; provided, however, that you shall return to the Corporation any payments received prior to a Change in Control (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code) if the contemplated Change in Control does not become effective within a reasonable period of time following the contemplated effective date. 7. Successors;_Binding_Agreement. (a) The Corporation will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Corporation or of any division or subsidiary thereof employing you to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Corporation would be required to perform if no such succession had taken place. Failure of the Corporation to obtain such assumption and agreement prior to the effectiveness of any such succession shall be a breach of this Agreement and shall entitle you to compensation from the Corporation in the same amount and on the same terms as you would be entitled hereunder if you terminated your employment for Good Reason, except that for purposes of implementing the foregoing, the date on which any such succession becomes effective shall be deemed to be the date of termination of your employment. (b) This Agreement shall inure to the benefit of and be enforceable by your personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. 8. Notice. For the purpose of this Agreement, notices and all other communications provided for in the Agreement shall be in writing and shall be deemed to have been duly given when delivered or mailed by United States registered mail, return receipt requested, postage prepaid, addressed to the respective addresses set forth on the first page of this Agreement, or to any changed address notice of which either of us shall have given to the other. 9. Miscellaneous. No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and signed by you and such officer as may be specifically designated by the Board. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the Commonwealth of Pennsylvania. 10. Validity. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect. 11. Effective_Date. This Agreement shall become effective as of the date signed by you. * * * If this letter sets forth our agreement on the subject matter hereof, kindly sign and return to the Corporation the enclosed copy of this letter, which will then constitute our agreement on this subject. Sincerely, AMPCO-PITTSBURGH CORPORATION By:s/Robert_A._Paul__________ Robert A. Paul President and Chief Executive Officer Accepted and Agreed to this 28th day of October, 1994. s/Louis_Berkman_________ Louis Berkman Chairman of the Board EX-27 4
EXHIBIT_27 ARTICLE_5_OF_REGULATION_S-X
5 1 9-MOS DEC-31-1994 SEP-30-1994 19,619,161 6,147,671 21,005,391 332,346 29,933,990 77,746,709 99,888,712 50,803,129 147,846,173 20,141,628 1,350,000 9,577,621 0 0 92,273,844 147,846,173 84,428,496 84,428,496 61,845,036 78,938,455 450,942 0 160,244 7,433,149 2,710,000 4,723,149 1,728,251 0 0 6,451,400 .67 .67
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