10-K405 1 MYERS INDUSTRIES 10-K405 1 -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 1994 COMMISSION FILE NUMBER 1-8524 MYERS INDUSTRIES, INC. (Exact name of registrant as specified in its charter) OHIO 34-0778636 (State or other jurisdiction of (IRS Employer Identification Number) incorporation or organization)
1293 S. MAIN STREET, AKRON, OHIO 44301 (216) 253-5592 (Address of Principal Executive Offices) (Zip Code) (Telephone Number) SECURITIES REGISTERED PURSUANT TO NAME OF EACH EXCHANGE SECTION 12(B) OF THE ACT: ON WHICH REGISTERED: Common Stock, Without Par Value American Stock Exchange (Title of Class)
SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT: None Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to the filing requirements for at least the past 90 days. Yes [X] No [ ] Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X] State the approximate aggregate market value of the voting stock held by non-affiliates of the registrant as of February 28, 1995: $208,789,079. Indicate the number of shares outstanding of registrant's common stock as of February 28, 1995: 15,320,753 Shares of Common Stock, without par value. -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- 2 DOCUMENTS INCORPORATED BY REFERENCE (1) Portions of Registrant's Notice of 1995 Annual Meeting and Proxy Statement, dated March 23, 1995, in Part III (Items 10, 11, 12 and 13) CROSS REFERENCE SHEET PURSUANT TO FORM 10-K GENERAL INSTRUCTION G(4)
PART/ITEM FORM 10-K HEADING REFERENCE MATERIAL --------- ------------------------------------------------------------ ---------------------- III/10 Directors and Executive Officers of the Registrant.......... Proxy Statement(1) pages 3 through 6 III/11 Executive Compensation...................................... Proxy Statement pages 7 through 10 III/12 Security Ownership of Certain Beneficial Owners and Management.............................................. Proxy Statement pages 3 through 6 and page 12 III/13 Certain Relationships and Related Transactions.............. Proxy Statement page 12 --------------- (1) Registrant's Notice of 1995 Annual Meeting of Shareholders and Proxy Statement
3 PART I ITEM 1. BUSINESS (A) GENERAL DEVELOPMENT OF BUSINESS Myers Industries, Inc. ("Company") has completed the best year in the Company's history. Net sales, net income, and net income per share were all at record levels for both the fourth quarter and the year ended December 31, 1994. Net sales for the fourth quarter were $79,725,182, up 21 percent from the $65,984,196 reported in the same year ago period. Net income for the period was $5,323,212, an increase of 15 percent from the $4,616,013 reported in 1993. Net income per share was $.35, up 17 percent from the $.30 per share earned in the fourth quarter of 1993. For the full year, net sales increased 12 percent, finishing at $274,054,163, up from the $245,136,189 produced in 1993. Net income for the year was $17,831,163, up 16 percent from the $15,394,727 reported in 1993. Net income per share was $1.17, up 11 percent from the $1.05 earned in 1993. All per share data have been adjusted for a five-for-four stock split distributed in August, 1994. Our capital position is excellent. Shareholders' equity increased $15.6 million to $130.9 million while total long-term debt decreased by $7.2 million to $4.8 million. This lowers our debt to 4 percent of equity which will serve us well in a period of rising interest rates. We do not anticipate any difficulty in meeting the capital needs of the Company in the immediate future. Both manufacturing and distribution segments enjoyed improved results over previous periods and all major subsidiaries contributed to the reported record results. We invested over $12 million to continue modernizing and expanding our manufacturing plants. We expect expansion of physical plant and equipment to continue in 1995. The price of raw materials, specifically plastic resin, rubber, and forest products increased several times last year. Although high inflation caused problems and cost us some money, strong sales, especially during the fourth quarter, partially mitigated its effects. We have been working to find solutions to the problem at the operating level but, eventually, those increases will have to be passed on to our customers. In the distribution segment, the majority of our branches set all-time sales and profit records. Additional field coverage and the Company's training programs for sales representatives and branch managers helped produce that strong performance. 1 4 (B) FINANCIAL INFORMATION ABOUT INDUSTRY SEGMENTS
1994 1993 1992 -------- -------- -------- (DOLLARS IN THOUSANDS) NET SALES Distribution of aftermarket repair products and services.............................................. $121,748 $107,214 $ 99,873 Manufacturing of polymer and metal products.............. 163,513 147,673 138,202 Intra-segment elimination................................ (11,207) (9,751) (8,820) -------- -------- -------- $274,054 $245,136 $229,255 ======== ======== ======== OPERATING INCOME BEFORE INCOME TAXES Distribution of aftermarket repair products and services.............................................. $ 11,387 $ 10,263 $ 7,779 Manufacturing of polymer and metal products.............. 24,418 20,594 19,505 Corporate................................................ (5,139) (4,317) (4,105) Interest expense -- net.................................. (620) (1,091) (1,342) -------- -------- -------- $ 30,046 $ 25,449 $ 21,837 ======== ======== ======== IDENTIFIABLE ASSETS Distribution of aftermarket repair products and services.............................................. $ 46,966 $ 40,780 $ 39,617 Manufacturing of polymer and metal products.............. 121,635 108,549 97,816 Corporate................................................ 4,492 3,782 6,124 Intra-segment elimination................................ (1,066) (725) (1,476) -------- -------- -------- $172,027 $152,386 $142,081 ======== ======== ======== CAPITAL ADDITIONS, NET Distribution of aftermarket repair products and services.............................................. $ 942 $ 452 $ 1,104 Manufacturing of polymer and metal products.............. 11,071 13,449 15,457 Corporate................................................ 493 208 107 -------- -------- -------- $ 12,506 $ 14,109 $ 16,668 ======== ======== ======== DEPRECIATION/AMORTIZATION Distribution of aftermarket repair products and services.............................................. $ 598 $ 565 $ 412 Manufacturing of polymer and metal products.............. 7,949 6,249 5,275 Corporate................................................ 274 263 235 -------- -------- -------- $ 8,821 $ 7,077 $ 5,922 ======== ======== ========
(C) DESCRIPTION OF BUSINESS The Company conducts its business activities in two distinct segments: manufacturing of polymer and metal products ("the Manufacturing business") and distribution of aftermarket repair products ("the Distribution business"). The Company believes it is one of the largest manufacturers of plastic and metal storage systems in the United States and has the only nationwide distribution network supplying the tire servicing and automotive underbody repair industries. The Company's Manufacturing business designs, manufactures and markets reusable plastic storage systems for use in distribution and material handling, and other plastic and metal products for storage, assembly and material handling applications. The Company also manufactures and sells molded rubber products and other materials used primarily in the tire and tire repair industries and for various other uses including OEM automotive and construction applications. In its Distribution business, the Company is engaged in the nationwide distribution of equipment, tools and supplies used for tire servicing and automotive underbody repair. 2 5 MANUFACTURING BUSINESS The Company markets reusable plastic containers under the brand names NesTier,(R) Akro-Bins(R) and Buckhorn.(R) These reusable plastic containers are utilized in industrial applications including the distribution of food items, such as poultry, meat and baked goods, and the distribution of non-food items such as apparel, electronic, automotive, and industrial components, health and beauty aids and hardware. Reusable containers are also used for storage and handling in manufacturing plants and for agricultural products. Other products sold to the industrial and commercial market include tote boxes, various styles of bins, tubs, straight-walled boxes, and a line of modular cabinets for small parts storage and organization. The Company's products are sold throughout the United States and Canada by a direct sales force, independent dealers and through independent representatives. The Company's consumer products include the Keepbox(R) line of household storage containers, plastic tool boxes and other products to organize the home workshop, plastic containers to facilitate consumer recycling, and a line of plastic pots, planters and urns sold to consumers through lawn and garden retailers and other similar specialty outlets. Consumer products are marketed nationally to a variety of customers including mass-merchandisers, such as Target(R) and Wal-Mart,(R) and major department stores and hardware chains, warehouse outlets and specialty shops. Products are mainly marketed under the Akro-Mils(R) name and other registered trade names, and to a lesser extent, under private label arrangements. The Company's products are sold throughout the United States by a direct sales force and independent representatives. The Company designs, manufactures, and markets molded rubber products, such as air intake hoses, rubber boots, mounts, and hood hold-down latches for diesel-powered vehicles and equipment used in the transportation, construction and agricultural industries. It also manufactures molded rubber products, rubber adhesives and materials used primarily in the tire retreading and repair industries, as well as products used in hydroelectric dams, locks and other water works systems. The Company has utilized its manufacturing systems and expertise to custom compound and calendar rubber materials to meet specific customer needs for a growing and diverse customer base. These products are sold nationally and internationally to manufacturers, construction companies and wholesale distributors, including the Distribution business, by a direct sales force and through independent sales representatives. The Company is continuously engaged in the refinement of its existing product lines and the development of new products. A large portion of the current products offered by the Company have been developed in the last five years. The Company's Manufacturing business is dependent upon outside suppliers for raw materials, principally polyethylene, polypropylene, polystyrene and synthetic and natural rubber. The Company believes that the loss of any one supplier or group of suppliers would not materially adversely affect its business, since in most instances identical or similar materials can be obtained readily from other suppliers. DISTRIBUTION BUSINESS The Company's Distribution business is conducted primarily by the Myers Tire Supply division. Products distributed by Myers Tire Supply include air compressors, mechanic's hand tools, tire changers, tire display and storage equipment, valves, tire balancing and wheel alignment equipment, curing rims and presses, retread presses and tire repair materials for the retreading industry. The Company believes it is the only nationwide distributor supplying such products. The Company's customers include independent tire dealers, tire retreaders, tire service centers, automotive supply chains and rubber companies. Myers Tire Supply's domestic distribution system includes 42 owned branch warehouse distributors located in major cities in 31 states. Each branch services customers in an assigned territory, sells all products of the division, and operates like a stand-alone business with the branch manager bearing profit/loss, inventory and credit responsibilities. Internationally, this business has 11 warehouse distributors in foreign countries. The two warehouse distributors located in Canada are wholly owned by the Company, and the Company owns an interest in the 9 other foreign warehouse distributors. 3 6 Myers Tire Supply supplies its domestic and international distribution facilities from its main distribution center. This distribution center stocks approximately 12,000 items which are purchased from numerous suppliers, including certain of the Company's manufacturing businesses. The Company's extensive national distribution network enables it to work closely with manufacturers in the development and distribution of new products. COMPETITION Competition in the Manufacturing business is substantial and varied in form and size from manufacturers of similar products and of other products which can be readily substituted for those produced by the Company. Competition in the Distribution business is generally from local and regional businesses. EMPLOYEES As of December 31, 1994, the Company had a total of 1,663 full-time and part-time employees. Of these employees, 1,111 were engaged in the Manufacturing business and 552 were employed in the Distribution business. Approximately 15% of the Company's employees are members of unions. The Company believes it has a good relationship with its employees (D) FINANCIAL INFORMATION ABOUT FOREIGN AND DOMESTIC OPERATIONS AND EXPORT SALES The Company operates principally in two areas of business, the first being the distribution of aftermarket repair products and services. These products are distributed both domestically through branches in the major cities in the United States and in foreign countries where, in some cases, the Company has controlling interest in companies located in those countries. No single foreign country represents more than 10 percent of the total sales, income or assets of the Company. The second major area of the Company's business is polymer and metal products which are manufactured in Company-owned facilities and distributed through mass merchandisers, warehouse distributors, sales representatives and in-house salesmen, principally in the United States. ITEM 2. PROPERTIES The following table sets forth by segment certain information with respect to properties owned by the Registrant: DISTRIBUTION OF AFTERMARKET REPAIR PRODUCTS AND SERVICES:
APPROXIMATE APPROXIMATE FLOOR SPACE LAND AREA PLANT LOCATION (SQUARE FEET) (ACRES) USE -------------------------- ------------- ----------- ---------------------------------- Akron, Ohio............... 113,500 8 Executive offices and warehousing Akron, Ohio............... 31,000 2 Warehousing Pomona, California........ 17,700 1 Sales and distribution Hialeah, Florida.......... 14,500 1 Sales and distribution Englewood, Colorado....... 9,500 1 Sales and distribution Pomona, California........ 9,200 1 Leased to non-affiliated party San Antonio, Texas........ 9,000 1 Sales and distribution Phoenix, Arizona.......... 8,200 1 Sales and distribution Akron, Ohio............... 8,000 1 Leased to non-affiliated party Houston, Texas............ 7,900 1 Sales and distribution Indianapolis, Indiana..... 7,800 2 Sales and distribution Cincinnati, Ohio.......... 7,500 1 Sales and distribution York, Pennsylvania........ 7,400 3 Sales and distribution
4 7
APPROXIMATE APPROXIMATE FLOOR SPACE LAND AREA PLANT LOCATION (SQUARE FEET) (ACRES) USE -------------------------- ------------- ----------- ---------------------------------- Atlanta, Georgia.......... 7,000 1 Sales and distribution Minneapolis, Minnesota.... 5,500 1 Sales and distribution Charlotte, North Carolina................ 5,100 1 Sales and distribution Syracuse, New York........ 4,800 1 Sales and distribution Franklin Park, Illinois... 4,400 1 Sales and distribution POLYMER AND METAL PRODUCTS: Dawson Springs, Kentucky................ 209,000 36 Manufacturing and distribution Roanoke Rapids, North Carolina.......... 172,000 20 Manufacturing and distribution Hannibal, Missouri........ 165,000 10 Manufacturing and distribution Wadsworth, Ohio........... 197,000 23 Manufacturing and distribution Akron, Ohio............... 121,000 17 Manufacturing and distribution Weirton, West Virginia.... 117,000 11 Leased to non-affiliated party Fairfield, Ohio........... 51,000 2 Manufacturing and distribution Akron, Ohio............... 49,000 6 Manufacturing and distribution Ontario, California....... 40,000 2 Distribution and warehousing
The following table sets forth by segment certain information with respect to facilities leased by the Registrant:
EXPIRATION DATE OF APPROXIMATE LEASE AND RENEWAL FLOOR SPACE OPTION PERIOD (IF LOCATION (SQUARE FEET) ANY) USE ----------------------- ------------- ----------------- --------------------------------------- POLYMER AND METAL PRODUCTS: Shelbyville, Kentucky............. 105,000 December 31, 1995(1) Manufacturing and distribution Mississauga, Ontario, Canada............... 23,000 December 31, 1997 Sales, administrative and distribution Milford, Ohio.......... 19,000 February 29, 1996 Sales and administrative Stanton, Harcourt, England.............. 12,000 December 31, 2001 Warehousing and distribution Witney, Oxon, England.............. 4,000 December 31, 2004 Sales, administration and distribution --------------- (1) Lease provides for an option to purchase at termination date for nominal consideration.
The Registrant also leases distribution facilities in thirty-one (31) locations throughout the United States and Canada which, in the aggregate, amount to approximately 157,000 square feet of warehouse and office space. All of these locations are used by the distribution of aftermarket repair products and services segment. The Registrant believes that all of its properties, machinery and equipment generally are well maintained and adequate for the purposes for which they are used. ITEM 3. LEGAL PROCEEDINGS There are no material pending legal proceedings other than ordinary routine litigation incidental to the Registrant's business. 5 8 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS During the fourth quarter of the fiscal year ended December 31, 1994, there were no matters submitted to a vote of security holders. EXECUTIVE OFFICERS OF THE REGISTRANT Set forth below is certain information concerning the executive officers of the Registrant. Executive officers are elected annually by the Board of Directors and serve at the pleasure of the Board.
YEARS AS NAME AGE EXECUTIVE OFFICER TITLE ----------------------------------- --- ----------------- -------------------------------------- Stephen E. Myers................... 51 22 President and Chief Executive Officer Milton I. Wiskind.................. 69 23 Senior Vice President and Secretary Gregory J. Stodnick................ 52 15 Vice President -- Finance
Each executive officer has been principally employed in the capacities shown or similar ones with the Registrant for over the past five years. Years as an Executive Officer is stated as of the time the Company became a public company for reporting purposes. Section 16(a) of the Securities Exchange Act of 1934 requires the Registrant's Directors, certain of its executive officers and persons who own more than ten percent of its Common Stock ("Insiders") to file reports of ownership and changes in ownership with the Securities and Exchange Commission and the American Stock Exchange, Inc., and to furnish the Company with copies of all such forms they file. The Company understands from the information provided to it by the Insiders that they adhered to all filing requirements. 6 9 PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS The Company's Common Stock is traded on the American Stock Exchange (ticker symbol MYE). The approximate number of record holders at December 31, 1994 was 1,800. High and low stock prices and dividends for the last two years were:
SALES PRICE* 1994 ------------ DIVIDENDS QUARTER ENDED HIGH LOW PAID* ---------------------------------------------------- ---- ---- --------- MARCH 31............................................ 18 3/8 16 1/4 .035 JUNE 30............................................. 17 3/8 15 1/8 .035 SEPTEMBER 30........................................ 17 3/4 15 7/8 .04 DECEMBER 31......................................... 17 3/4 12 7/8 .04
SALES PRICE* 1993 ------------ DIVIDENDS QUARTER ENDED HIGH LOW PAID* ---------------------------------------------------- ---- ---- --------- March 31............................................ 19 1/8 15 1/4 .03 June 30............................................. 18 7/8 16 .03 September 30........................................ 20 16 1/4 .035 December 31......................................... 19 1/4 15 3/8 .035 --------------- * Adjusted for the five-for-four stock split distributed in August, 1994.
7 10 ITEM 6. SELECTED FINANCIAL DATA MYERS INDUSTRIES, INC. AND SUBSIDIARIES ELEVEN-YEAR SUMMARY
1994 1993 1992 1991 1990 ------------- ------------- ------------- ------------- ------------- OPERATIONS FOR THE YEAR Net sales.............................. $ 274,054,163 $ 245,136,189 $ 229,255,085 $ 195,581,070 $ 202,104,203 Cost and expenses Cost of sales........................ 183,890,614 163,794,129 154,007,502 129,148,273 136,602,663 Selling.............................. 32,238,245 30,428,260 27,286,626 24,442,225 23,054,815 General and administrative........... 27,258,865 24,373,483 24,782,393 22,407,924 21,674,409 Interest -- net...................... 620,276 1,091,590 1,341,811 1,738,878 2,780,598 ------------- ------------- ------------- ------------- ------------- 244,008,000 219,687,462 207,418,332 177,737,300 184,112,485 ------------- ------------- ------------- ------------- ------------- Income before income taxes........... 30,046,163 25,448,727 21,836,753 17,843,770 17,991,718 Income taxes......................... 12,215,000 10,054,000 8,727,000 7,308,000 7,234,000 ------------- ------------- ------------- ------------- ------------- Net income........................... $ 17,831,163 $ 15,394,727 $ 13,109,753 $ 10,535,770 $ 10,757,718 ------------- ------------- ------------- ------------- ------------- Net income per share*.................... $1.17 $1.05 $.93 $.76 $.78 ------------- ------------- ------------- ------------- ------------- FINANCIAL POSITION -- AT YEAR END Total Assets......................... $ 172,026,887 $ 152,386,302 $ 142,081,023 $ 113,030,476 $ 116,373,153 ------------- ------------- ------------- ------------- ------------- Current assets....................... 94,724,955 78,922,479 74,892,471 60,723,337 63,310,846 Current liabilities.................. 34,093,593 24,380,541 31,685,772 25,346,105 26,345,655 ------------- ------------- ------------- ------------- ------------- Working capital...................... 60,631,362 54,541,938 43,206,699 35,377,232 36,965,191 Other assets......................... 15,923,620 15,769,611 16,525,900 12,969,476 14,363,401 Property, plant and equipment -- net................... 61,378,312 57,694,212 50,662,652 39,337,663 38,698,906 Less: Long-term debt..................... 4,154,646 10,654,650 24,917,426 14,559,630 25,361,688 Deferred income taxes.............. 2,869,976 2,064,399 1,594,855 670,922 1,471,796 ------------- ------------- ------------- ------------- ------------- SHAREHOLDERS' EQUITY..................... $ 130,908,672 $ 115,286,712 $ 83,882,970 $ 72,453,819 $ 63,194,014 ------------- ------------- ------------- ------------- ------------- COMMON SHARES OUTSTANDING*............... 15,300,092 15,278,729 14,093,170 13,876,398 13,835,633 ------------- ------------- ------------- ------------- ------------- BOOK VALUE PER COMMON SHARE*............. $8.56 $7.54 $5.95 $5.22 $4.57 ------------- ------------- ------------- ------------- ------------- OTHER DATA Dividends paid....................... $ 2,337,953 $ 2,058,288 $ 1,746,780 $ 1,530,455 $ 1,395,850 Dividends paid per Common Share*..... .15 .13 .12 .11 .10 ------------- ------------- ------------- ------------- ------------- Average Common Shares* outstanding during the year.......... 15,300,345 14,724,598 14,062,828 13,862,025 13,821,173 =========== =========== =========== =========== =========== --------------- * Adjusted for the five-for-four stock split distributed in August, 1994; the ten percent stock dividend paid in August, 1993; the five-for-four stock split distributed in August, 1992; the ten percent stock dividends paid in August, 1991; August, 1990; and September, 1988; the three-for-two stock split distributed in September, 1987; the ten percent stock dividends paid in August, 1986; and August, 1985; and the two-for-one stock split distributed in May, 1984.
8 11 ITEM 6. SELECTED FINANCIAL DATA -- CONTINUED MYERS INDUSTRIES, INC. AND SUBSIDIARIES ELEVEN-YEAR SUMMARY -- CONTINUED
1989 1988 1987 1986 1985 1984 ------------ ------------ ------------ ----------- ----------- ----------- OPERATIONS FOR THE YEAR Net sales....................... $194,771,836 $183,810,747 $131,710,204 $89,645,730 $85,250,021 $86,003,717 Cost and expenses Cost of sales................. 134,234,037 129,065,978 90,243,676 60,089,248 58,173,213 58,903,327 Selling....................... 20,732,345 18,528,963 15,276,676 10,767,736 10,151,414 10,003,453 General and administrative.... 19,896,487 18,726,786 14,854,167 11,355,895 10,423,738 9,913,980 Interest -- net............... 3,692,592 3,624,112 1,759,659 275,179 197,252 (248,853) ------------ ------------ ------------ ----------- ----------- ----------- 178,555,461 169,945,839 122,134,178 82,488,058 78,945,617 78,571,907 ------------ ------------ ------------ ----------- ----------- ----------- Income before income taxes.... 16,216,375 13,864,908 9,576,026 7,157,672 6,304,404 7,431,810 Income taxes.................. 6,595,000 5,797,000 4,358,000 3,443,000 2,881,000 3,611,000 ------------ ------------ ------------ ----------- ----------- ----------- Net Income.................... $ 9,621,375 $ 8,067,908 $ 5,218,026 $ 3,714,672 $ 3,423,404 $ 3,820,810 ------------ ------------ ------------ ----------- ----------- ----------- Net income per share*............. $.70 $.59 $.38 $.27 $.24 $.25 ------------ ------------ ------------ ----------- ----------- ----------- FINANCIAL POSITION -- AT YEAR END Total Assets.................. $111,104,356 $109,668,585 $103,401,944 $52,736,836 $51,432,421 $52,572,215 ------------ ------------ ------------ ----------- ----------- ----------- Current assets................ 61,479,468 58,852,930 52,171,313 38,173,150 36,362,072 39,477,241 Current liabilities........... 26,397,909 24,796,004 28,326,238 10,605,351 9,755,442 10,347,071 ------------ ------------ ------------ ----------- ----------- ----------- Working capital............... 35,081,559 34,056,926 23,845,075 27,567,799 26,606,630 29,130,170 Other assets.................. 15,612,316 18,057,080 21,275,608 1,146,427 1,119,083 865,780 Property, plant and equipment -- net............ 34,012,572 32,758,575 29,955,023 13,417,259 13,951,266 12,229,194 Less: Long-term debt.............. 29,833,585 38,433,060 35,502,197 6,063,666 8,633,323 7,306,240 Deferred income taxes....... 1,579,955 1,672,313 1,570,207 2,545,724 2,391,589 2,408,923 ------------ ------------ ------------ ----------- ----------- ----------- SHAREHOLDERS' EQUITY.............. $ 53,292,907 $ 44,767,208 $ 38,003,302 $33,522,095 $30,652,067 $32,509,981 ------------ ------------ ------------ ----------- ----------- ----------- COMMON SHARES OUTSTANDING*........ 13,802,276 13,745,430 13,644,175 13,624,183 13,542,963 15,189,709 ------------ ------------ ------------ ----------- ----------- ----------- BOOK VALUE PER COMMON SHARE*...... $3.86 $3.25 $2.79 $2.46 $2.26 $2.14 ------------ ------------ ------------ ----------- ----------- ----------- OTHER DATA Dividends paid................ $ 1,265,208 $ 1,134,314 $ 1,049,550 $ 972,065 $ 899,278 $ 864,540 Dividends paid per Common Share*...................... .09 .08 .075 .07 .06 .055 ------------ ------------ ------------ ----------- ----------- ----------- Average Common Shares* outstanding during the year........................ 13,777,715 13,729,751 13,635,828 13,618,398 14,204,176 15,202,953 =========== =========== =========== ========== ========== ========== --------------- * Adjusted for the five-for-four stock split distributed in August, 1994; the ten percent stock dividend paid in August, 1993; the five-for-four stock split distributed in August, 1992; the ten percent stock dividends paid in August, 1991; August, 1990; and September, 1988; the three-for-two stock split distributed in September, 1987; the ten percent stock dividends paid in August, 1986; and August, 1985; and the two-for-one stock split distributed in May, 1984.
9 12 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS Net sales for the year ended December 31, 1994 increased $28.9 million or 12 percent compared to 1993. This record performance, the best in the Company's history, was the result of strong growth in both of the Company's business segments. The increase in the Distribution segment of $14.5 million or 14 percent resulted from strong equipment sales, a pick-up in international activity and the acquisition of a distributor. Sales in the Manufacturing segment increased $15.8 million or 11 percent. Improved sales of existing products, the introduction of new products and extensions of existing product lines were the main factors for the increase. Net sales for the year ended December 31, 1993 increased $15.9 million or 7 percent compared to 1992. This performance was the result of increased unit volume in each of the Company's business segments. The increase in the Distribution segment of $7.3 million or 7 percent was the result of expanded market coverage, new product introductions and the acquisition of a distributor. Sales in the Manufacturing segment increased $9.5 million or 7 percent due primarily to sustained demand for existing consumer and industrial product lines and concentrated sales and marketing efforts. Cost of sales for the year ended December 31, 1994 increased $20.1 million or 12 percent over 1993 as the result of the higher sales volume. Gross profit, expressed as a percent of sales, decreased to 32.9 percent in 1994 from 33.2 percent in 1993. The decrease in the gross profit percent is the result of increased raw material prices, mainly resin and rubber, which were partially offset by the increased plant utilization caused by the higher sales volume. Cost of sales for the year ended December 31, 1993 increased $9.8 million or 6 percent over 1992 as the result of higher sales volume. Gross profit, expressed as a percentage of sales, increased to 33.2 percent in 1993 from 32.8 percent in 1992. The increase in the gross profit percent was attributable to the Company's emphasis on efficient utilization of production capacity and favorable raw material prices. Operating expenses for the year ended December 31, 1994 increased $4.7 million or 9 percent over 1993. The increase was principally due to the higher sales volume. As a percent of sales, operating expenses decreased to 21.7 percent in 1994 as compared to 22.4 percent in 1993. This improvement was the result of on-going cost control programs and better fixed expense coverage. Operating expenses for the year ended December 31, 1993 increased $2.7 million or 5 percent over 1992. Increased selling expenses due to higher sales volume was the principal reason for the change. Operating expenses as a percentage of sales, decreased to 22.4 percent in 1993 as compared to 22.7 percent in 1992. Efficient cost control programs contributed to the improvement. Interest income for the year ended December 31, 1994 increased $50,039 or 41 percent from 1993 primarily from higher interest rates. Interest income for the year ended December 31, 1993 decreased $70,515 or 37 percent from 1992. This decrease was the result of a reduction in notes receivable outstanding. Interest expense for the year ended December 31, 1994 decreased $421,275 or 35 percent from 1993 as a result of lower long-term debt levels. Interest expense for the year ended December 31, 1993 decreased $320,736 or 21 percent from 1992. Proceeds from the Company's Common Stock offering in May of 1993 were used to pay down debt levels, which led to the reduced interest expense. Income taxes as a percent of income before taxes was 40.7 percent in 1994, up from 39.5 percent in 1993. The higher effective tax rate was attributable to the adoption by the Company in 1993 of FASB Statement 109, "Accounting for Income Taxes" which reduced income tax expense in 1993 by $210,000. The 1992 effective tax rate was 40 percent. 10 13 FINANCIAL CONDITION Working capital increased to $60.6 million for the year ended December 31, 1994 compared to $54.5 million for 1993. Total debt expressed as a percent of total capitalization decreased to 3.6 percent for the year ended December 31, 1994 compared to 9.5 percent in 1993. This strong capital position provides the Company with the flexibility to finance additional manufacturing capacity, working capital needs, and other corporate purposes. During the next five years, the Company anticipates on-going capital expenditures in the range of $12.0 to $15.0 million per year, primarily for increased polymer manufacturing capacity. Management believes available credit facilities and anticipated cash flows from operations will be sufficient to meet the needs of its business, both short-term and long-term. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The consolidated financial statements and accompanying notes and the reports of management and independent accountants follow Item 9 of this Report. ITEM 9. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE There were no disagreements with the Registrant's independent accountants on accounting and financial disclosure matters within the two year period ended December 31, 1994, or in any period subsequent to such date. 11 14 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA (CONTINUED) COMMON STOCK MARKET PRICES AND DIVIDENDS The Company's Common Stock is traded on the American Stock Exchange (ticker symbol MYE). The approximate number of record holders at December 31, 1994 was 1,800. High and low stock prices and dividends for the last two years were:
SALES PRICE* DIVIDENDS PAID* ------------ --------------- HIGH LOW ---- --- QUARTER ENDED 1994 MARCH 31............................................. 18 3/8 16 1/4 .035 JUNE 30.............................................. 17 3/8 15 1/8 .035 SEPTEMBER 30......................................... 17 3/4 15 7/8 .04 DECEMBER 31.......................................... 17 3/4 12 7/8 .04 SALES PRICE* DIVIDENDS PAID* ------------ --------------- HIGH LOW ---- --- Quarter Ended 1993 March 31............................................. 19 1/8 15 1/4 .03 June 30.............................................. 18 7/8 16 .03 September 30......................................... 20 16 1/4 .035 December 31.......................................... 19 1/4 15 3/8 .035
SUMMARIZED QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) THOUSANDS OF DOLLARS, EXCEPT PER SHARE DATA
MARCH 31 JUNE 30 SEPT. 30 DEC. 31 TOTAL -------- ------- -------- ------- -------- QUARTER ENDED 1994 NET SALES................................. $59,695 $68,442 $ 66,192 $79,725 $274,054 GROSS PROFIT.............................. 19,308 23,536 21,174 26,146 90,164 NET INCOME................................ 3,498 5,144 3,866 5,323 17,831 PER SHARE*................................ .23 .34 .25 .35 1.17 MARCH 31 JUNE 30 SEPT. 30 DEC. 31 TOTAL -------- ------- -------- ------- -------- Quarter Ended 1993 Net sales................................. $54,407 $63,559 $ 61,186 $65,984 $245,136 Gross profit.............................. 18,176 21,201 18,863 23,102 81,342 Net income................................ 3,269 4,376 3,134 4,616 15,395 Per share*................................ .23 .31 .21 .30 1.05 --------------- * Adjusted for the five-for-four stock split distributed in August, 1994.
12 15 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS We have audited the accompanying statements of consolidated financial position of Myers Industries, Inc. (an Ohio Corporation) and Subsidiaries as of December 31, 1994 and 1993, and the related statements of consolidated income, shareholders' equity and cash flows for each of the three years in the period ended December 31, 1994. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Myers Industries, Inc. and Subsidiaries as of December 31, 1994 and 1993, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 1994, in conformity with generally accepted accounting principles. /s/ ARTHUR ANDERSEN LLP Cleveland, Ohio February 8, 1995 13 16 MYERS INDUSTRIES, INC. AND SUBSIDIARIES STATEMENTS OF CONSOLIDATED INCOME FOR THE YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992
1994 1993 1992 ------------ ------------ ------------ Net sales........................................ $274,054,163 $245,136,189 $229,255,085 Cost of sales.................................... 183,890,614 163,794,129 154,007,502 ------------ ------------ ------------ Gross profit................................... 90,163,549 81,342,060 75,247,583 ------------ ------------ ------------ Operating expenses Selling........................................ 32,238,245 30,428,260 27,286,626 General and administrative..................... 27,258,865 24,373,483 24,782,393 ------------ ------------ ------------ 59,497,110 54,801,743 52,069,019 ------------ ------------ ------------ Operating income............................ 30,666,439 26,540,317 23,178,564 ------------ ------------ ------------ Interest Income......................................... (170,728) (120,689) (191,204) Expense........................................ 791,004 1,212,279 1,533,015 ------------ ------------ ------------ 620,276 1,091,590 1,341,811 ------------ ------------ ------------ Income before income taxes....................... 30,046,163 25,448,727 21,836,753 Income taxes..................................... 12,215,000 10,054,000 8,727,000 ------------ ------------ ------------ Net income....................................... $ 17,831,163 $ 15,394,727 $ 13,109,753 ------------ ------------ ------------ Net income per share............................. $1.17 $1.05 $.93 =========== =========== ===========
The accompanying notes are an integral part of these statements. 14 17 MYERS INDUSTRIES, INC. AND SUBSIDIARIES STATEMENTS OF CONSOLIDATED FINANCIAL POSITION AS OF DECEMBER 31, 1994 AND 1993
1994 1993 ------------ ------------ ASSETS CURRENT ASSETS Cash and temporary cash investments........................... $ 1,794,703 $ 1,661,783 Accounts receivable -- less allowances of $1,479,000 and $1,525,000, respectively................................... 51,226,688 40,404,841 Inventories Finished and in-process products........................... 33,572,557 30,119,918 Raw materials and supplies................................. 5,809,158 4,821,822 ------------ ------------ 39,381,715 34,941,740 Prepaid expenses.............................................. 2,321,849 1,914,115 ------------ ------------ TOTAL CURRENT ASSETS............................................ 94,724,955 78,922,479 OTHER ASSETS Excess of cost over fair value of net assets of companies acquired................................................... 9,289,115 9,574,475 Patents and other intangible assets........................... 3,219,371 3,499,903 Other......................................................... 3,415,134 2,695,233 ------------ ------------ 15,923,620 15,769,611 PROPERTY, PLANT AND EQUIPMENT, AT COST Land.......................................................... 1,836,637 1,827,586 Buildings and leasehold improvements.......................... 29,010,268 29,079,238 Machinery and equipment....................................... 85,710,088 74,400,453 ------------ ------------ 116,556,993 105,307,277 Less allowances for depreciation and amortization............. 55,178,681 47,613,065 ------------ ------------ 61,378,312 57,694,212 ------------ ------------ $172,026,887 $152,386,302 =========== =========== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable.............................................. $ 19,751,167 $ 12,272,184 Employee compensation and related items....................... 8,911,996 6,830,956 Accrued expenses Interest................................................... 59,729 63,265 Taxes, other than income taxes............................. 974,853 728,515 Income taxes............................................... 431,805 160,534 Other...................................................... 3,271,664 2,895,646 Current portion of long-term debt............................. 692,379 1,429,441 ------------ ------------ TOTAL CURRENT LIABILITIES....................................... 34,093,593 24,380,541 LONG-TERM DEBT, LESS CURRENT PORTION............................ 4,154,646 10,654,650 DEFERRED INCOME TAXES........................................... 2,869,976 2,064,399 SHAREHOLDERS' EQUITY Serial Preferred Shares (authorized 1,000,000 shares)......... -0- -0- Common Shares, without par value (authorized 30,000,000 shares; outstanding 15,300,092 and 15,278,729 shares, respectively).............................................. 8,303,598 7,697,032 Additional paid-in capital.................................... 90,606,429 91,030,715 Foreign currency translation adjustment....................... (466,191) (412,661) Retained income............................................... 32,464,836 16,971,626 ------------ ------------ 130,908,672 115,286,712 ------------ ------------ $172,026,887 $152,386,302 =========== ===========
The accompanying notes are an integral part of these statements. 15 18 MYERS INDUSTRIES, INC. AND SUBSIDIARIES STATEMENTS OF CONSOLIDATED SHAREHOLDERS' EQUITY FOR THE YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992
FOREIGN COMMON SHARES ADDITIONAL CURRENCY ----------------------- PAID-IN TRANSLATION RETAINED NUMBER AMOUNT CAPITAL ADJUSTMENT INCOME ---------- ---------- ----------- ---------- ----------- BALANCE AT JANUARY 1, 1992......... 8,073,540 $5,395,838 $47,559,044 $ 512,255 $18,986,682 Additions Pooling of interests............. 78,830 52,816 (10,236) -0- 312,463 Net income....................... -0- -0- -0- -0- 13,109,753 Sales under option plans......... 38,742 253,432 -0- -0- -0- Employees stock purchase plan.... 11,964 222,623 -0- -0- -0- Five-for-four stock split........ 2,045,934 -0- -0- -0- -0- Dividend reinvestment plan....... 568 10,011 -0- -0- -0- Deductions Foreign currency translation adjustment.................... -0- -0- -0- (774,931) -0- Dividends -- $.12 per share...... -0- -0- -0- -0- (1,746,780) ---------- ---------- ----------- ---------- ----------- BALANCE AT DECEMBER 31, 1992....... 10,249,578 $5,934,720 $47,548,808 $ (262,676) $30,662,118 ---------- ---------- ----------- ---------- ----------- Additions Shares issued through public offering...................... 820,000 492,000 17,142,206 -0- -0- Net income....................... -0- -0- -0- -0- 15,394,727 Sales under option plans......... 29,997 237,262 -0- -0- -0- Employees stock purchase plan.... 12,211 288,858 -0- -0- -0- Dividend reinvestment plan....... 2,856 68,104 -0- -0- -0- Deductions Foreign currency translation adjustment.................... -0- -0- -0- (149,985) -0- Dividends -- $.13 per share...... -0- -0- -0- -0- (2,058,288) 10% stock dividend............... 1,108,341 676,088 26,339,701 -0- (27,026,931) ---------- ---------- ----------- ---------- ----------- BALANCE AT DECEMBER 31, 1993....... 12,222,983 $7,697,032 $91,030,715 $ (412,661) $16,971,626 ---------- ---------- ----------- ---------- ----------- Additions Net income....................... -0- -0- -0- -0- 17,831,163 Sales under option plans......... 25,747 162,552 -0- -0- -0- Employees stock purchase plan.... 16,358 326,588 -0- -0- -0- Five-for-four stock split........ 3,061,333 -0- -0- -0- -0- Dividend reinvestment plan....... 6,971 135,408 -0- -0- -0- Deductions Foreign currency translation adjustment.................... -0- -0- -0- (53,530) -0- Purchases for treasury........... (33,300) (17,982) (424,286) -0- -0- Dividends -- $.15 per share...... -0- -0- -0- -0- (2,337,953) ---------- ---------- ----------- ---------- ----------- BALANCE AT DECEMBER 31, 1994....... 15,300,092 $8,303,598 $90,606,429 $ (466,191) $32,464,836 ========= ========= ========== ========= ==========
The accompanying notes are an integral part of these statements. 16 19 MYERS INDUSTRIES, INC. AND SUBSIDIARIES STATEMENTS OF CONSOLIDATED CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992
1994 1993 1992 ------------ ------------ ------------ CASH FLOWS FROM OPERATING ACTIVITIES Net income....................................... $ 17,831,163 $ 15,394,727 $ 13,109,753 Items not affecting use of cash Depreciation.................................. 8,821,426 7,077,089 5,922,280 Amortization of excess of cost over fair value of net assets of companies acquired......... 285,360 243,808 312,979 Amortization of deferred financing costs...... 78,436 56,972 93,824 Amortization of patents and other intangible assets...................................... 295,115 312,297 81,190 Tax benefit of net operating loss and credit carryforwards............................... -0- 56,600 551,000 Deferred income taxes......................... 805,577 469,544 923,933 Cash flow provided by (used for) working capital Accounts receivable........................... (10,821,847) (2,094,805) (7,705,510) Inventories................................... (4,439,975) (4,065,048) (5,744,523) Prepaid expenses.............................. (407,734) 375,272 (458,630) Accounts payable and accrued expenses......... 10,450,114 (4,167,661) 6,936,677 ------------ ------------ ------------ Net cash provided by operating activities..... 22,897,635 13,658,795 14,022,973 CASH FLOWS FROM INVESTING ACTIVITIES Additions to property, plant and equipment, net........................................... (12,505,526) (14,108,649) (16,667,537) Acquisition of patents and other intangible assets........................................ (14,583) -0- (3,893,390) Cash dividends paid.............................. (2,337,953) (2,058,288) (1,746,780) Other............................................ (227,319) 519,709 (1,240,770) ------------ ------------ ------------ Net cash used for investing activities........ (15,085,381) (15,647,228) (23,548,477) CASH FLOWS FROM FINANCING ACTIVITIES Purchases for treasury........................... (442,268) -0- -0- Proceeds from issuance of common stock........... -0- 17,634,206 -0- Borrowings (repayments) net...................... (7,237,066) (17,400,346) 9,760,786 ------------ ------------ ------------ Net cash provided by (used for) financing activities.................................. (7,679,334) 233,860 9,760,786 CASH OF COMPANIES ACQUIRED......................... -0- -0- 25,189 ------------ ------------ ------------ INCREASE (DECREASE) IN CASH AND TEMPORARY CASH INVESTMENTS...................................... 132,920 (1,754,573) 260,471 CASH AND TEMPORARY CASH INVESTMENTS January 1........................................ 1,661,783 3,416,356 3,155,885 CASH AND TEMPORARY CASH INVESTMENTS ------------ ------------ ------------ December 31...................................... $ 1,794,703 $ 1,661,783 $ 3,416,356 =========== =========== =========== SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Cash paid during the year for Interest...................................... $ 749,540 $ 1,354,776 $ 1,475,179 Income taxes.................................. 11,138,152 9,372,275 8,107,452
The accompanying notes are an integral part of these statements. 17 20 MYERS INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES PRINCIPLES OF CONSOLIDATION The consolidated financial statements include the accounts of Myers Industries, Inc. and all wholly owned subsidiaries. Significant intercompany accounts and transactions have been eliminated in consolidation. TRANSLATION OF FOREIGN CURRENCIES All balance sheet accounts of consolidated foreign subsidiaries are translated at the current exchange rate as of the end of the accounting period and income statement items are translated at an average currency exchange rate. The resulting translation adjustment is recorded as a separate component of shareholders' equity. CASH AND TEMPORARY CASH INVESTMENTS The Company has a cash management program which provides for the investment of excess cash balances in temporary cash investments. For purposes of this statement, temporary cash investments, all of which have an original maturity of ninety days or less, are considered cash equivalents. INVENTORIES Inventories are stated at the lower of cost or market. For approximately 73 percent of its inventories, the Company uses the last-in, first-out (LIFO) method of determining cost. All other inventories are valued at first-in, first-out (FIFO) method of determining cost. If the FIFO method of inventory cost valuation had been used exclusively by the Company, inventories would have been $5,196,000, $3,906,000 and $3,692,000 higher than reported at December 31, 1994, 1993 and 1992, respectively. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment are carried at cost less accumulated depreciation and amortization. The Company provides for depreciation and amortization on the basis of annual rates expected to amortize the cost of such assets over their estimated useful lives by the straight-line method. REVENUE RECOGNITION The company's revenue recognition policy is to recognize revenue from sales when goods are shipped. INCOME TAXES Deferred income taxes are provided to recognize the timing differences between financial statement and income tax reporting, principally for depreciation and certain valuation allowances. Deferred taxes are not provided on the unremitted earnings of foreign subsidiaries as the Company's intention is to permanently reinvest these earnings in the operations of these subsidiaries. If these earnings would be remitted in future years, the taxes due after considering available foreign tax credits would not be material. EXCESS OF COST OVER FAIR VALUE OF NET ASSETS OF COMPANIES ACQUIRED This asset represents the excess of cost over the fair value of net assets of companies acquired and is being amortized on a straight-line basis over 40 years. Accumulated amortization at December 31, 1994 and 1993 was $2,496,000 and $2,210,000, respectively. 18 21 MYERS INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) RESEARCH AND DEVELOPMENT Research, engineering, testing and product development costs are charged to current operations as incurred. NET INCOME PER SHARE Income per share is determined on the basis of the weighted average number of Common Shares and common stock equivalents outstanding during the year. During the years ended December 31, 1994 and 1992 the Company distributed a five-for-four stock split and during the year ended December 31, 1993 the Company paid a ten percent stock dividend. All per share data has been adjusted for the stock dividend and the stock splits. FINANCIAL INSTRUMENTS Financial instruments, consisting of cash equivalents, trade and notes receivable, and long term debt, are recorded at their historical costs which approximate their fair market value. ACQUISITIONS On January 15, 1992, the Company completed the acquisition of Retreaders Supply Co., Inc., a distributor of tire supplies and retread products. The transaction was effected through the exchange of 66,356 shares of the Company's Common Stock for all the issued and outstanding shares of Retreaders Supply Co., Inc. Also acquired on January 15, 1992, was Alpha Technical Services, Inc., a manufacturer of metal products primarily used in the material handling field. This transaction was effected through the exchange of 12,474 shares of the Company's Common Stock for all the issued and outstanding shares of Alpha Technical Services, Inc. These acquisitions have been accounted for as a pooling of interests and accordingly, the accompanying consolidated financial statements for the year ending December 31, 1992, include the accounts of both Alpha Technical Services, Inc. and Retreaders Supply Co., Inc. Prior year amounts have not been restated as the effect is immaterial. On August 31, 1992, a subsidiary of the Company acquired all tooling, patents and marketing rights to a line of commercial bakery trays from Ekco/Glaco Inc. for approximately $4,900,000. In connection with this transaction, the Company acquired tooling valued at $1,000,000, patents valued at $800,000 and other intangible assets representing the value of customer lists, trademarks and marketing rights. The patents are being amortized on a straight-line basis over their remaining lives and all other intangible assets on a straight-line basis over 15 years. On August 31, 1993, the Company acquired certain assets and operations of the J.A. Peterson Company, a distributor of tire supplies and retread products, for approximately $685,000. The acquisition has been accounted for by the purchase method of accounting and, accordingly, J.A. Peterson's results of operations have been included in the accompanying consolidated financial statements beginning September 1, 1993. J.A. Peterson's operations are not material in relation to the Company's consolidated financial statements and proforma financial information has therefore not been presented. On January 28, 1994, the Company acquired certain assets and operations of Northwest Tire Shop Supply, Inc., a distributor of tire supplies and retread products, for approximately $356,000. The acquisition has been accounted for by the purchase method of accounting and, accordingly, Northwest's results of operations have been included in the accompanying consolidated financial statements beginning February 1, 1994. Northwest's operations are not material in relation to the Company's consolidated financial statements and proforma financial information has therefore not been presented. 19 22 MYERS INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) RETIREMENT PLANS The Company and certain of its subsidiaries have pension and profit sharing plans covering substantially all of their employees. Two plans are defined benefit plans with benefits primarily based upon a fixed amount for each year of service. It is the Company's policy to fund pension costs accrued, which are at least equal to the minimum required contribution as defined by the Employee Retirement Income Security Act of 1974. For the Company's existing defined benefit plans, net periodic pension costs was as follows:
1994 1993 1992 --------- --------- --------- Service cost-benefit earned during the year..... $ 107,451 $ 117,953 $ 116,219 Interest cost on projected benefit obligation... 148,485 150,083 142,562 Return on plan assets........................... 10,580 (136,481) (137,600) Net amortization................................ (154,358) (5,049) 4,290 --------- --------- --------- Net periodic pension cost....................... $ 112,158 $ 126,506 $ 125,471 ========= ========= =========
Assumptions used for these plans were as follows: discount rate, 6.5%; rate of return on plan assets, 8.0%. Future benefit increases were not considered as there is no substantive commitment to increase benefits. The following table sets forth the plans' funded status at December 31, 1994 and 1993 (in thousands):
1994 1993 ------------------ ------- OVER- UNDER- UNDER- FUNDED FUNDED FUNDED PLANS PLANS PLANS ------ ------- ------- Projected benefit obligation Vested benefits......................................... $ 652 $ 1,222 $ 2,294 Non-vested.............................................. 8 192 224 ------ ------- ------- Accumulated benefit obligation............................ 660 1,414 2,518 Fair value of plan assets................................. 798 1,327 2,285 ------ ------- ------- Projected benefit obligation in excess of plan assets..... 138 (87) (233) Unrecognized net (gain)................................... (131) (128) (47) Unrecognized net obligation at date of adoption........... 95 139 282 ------ ------- ------- Net projected pension (liability) asset................... $ 102 $ (76) $ 2 ===== ====== ======
A profit sharing plan is maintained for eligible employees, not covered under defined benefit plans, who meet minimum tenure requirements. The amount to be contributed by the Company under the profit sharing plan is determined at the discretion of the Board of Directors. During 1994, the Company terminated a certain hourly pension plan and covered the employees under the Company's profit sharing plan. As a result, the Company recognized a $90,000 charge for the curtailment of this plan. The aggregate cost of all retirement and profit sharing plans reflected in the accompanying statements of consolidated income is $1,224,000, $1,104,000 and $1,065,000 for the years 1994, 1993 and 1992, respectively. In addition to these plans, the Company entered into an agreement in 1983 with its Chairman providing for annual payments of $200,000, which commenced in 1989 for a term of ten years. Pursuant to an amendment in the plan in July, 1993, the Company will pay the Chairman's widow $200,000 annually during her lifetime. 20 23 MYERS INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) LONG-TERM DEBT AND CREDIT AGREEMENTS Long-term debt at December 31 consisted of the following:
1994 1993 ---------- ----------- Revolving credit agreement......................... $2,000,000 $ 6,500,000 Industrial revenue bonds........................... 2,275,166 5,199,166 Other.............................................. 571,859 384,925 ---------- ----------- 4,847,025 12,084,091 Less current portion............................... 692,379 1,429,441 ---------- ----------- $4,154,646 $10,654,650 ========= ==========
The Company has a Revolving Credit Agreement with a group of banks which enables the Company to borrow up to $25,000,000 at prime rate on a variable basis, or on a short-term fixed basis at a rate based upon LIBOR or certificate of deposits at the participating banks. The agreement is unsecured and expires on June 30, 1995. At December 31, 1994, the borrowings under this agreement have been classified as long-term since the Company has commitments to renew this agreement. The Revolving Credit facility currently bears interest on the outstanding balance at an average rate of 6.75 percent. In addition, the Company is required to pay on a quarterly basis a commitment fee of 1/4 percent per annum on the daily unborrowed portion of the revolving credit commitment. The industrial revenue bonds are secured by plant and equipment purchased by the Company with the proceeds of the bonds. In January, 1994, the Company redeemed $2,330,000 of these by drawing on the Revolving Credit facility. The remaining bonds mature at various dates through 1999 with variable interest rates ranging from 4.20 percent to 6.97 percent. One industrial revenue bond is backed by a standby letter of credit totaling $1,331,250 with an associated fee of 3/4 percent per annum. Other includes various notes and capitalized leases which mature in various amounts through 1999 and bear a weighted average interest rate of 9.71 percent. The maturities of long-term debt for the five years ending December 31, 1999, are $692,000 in 1995; $622,000 in 1996; $607,000 in 1997; $520,000 in 1998; and $332,000 in 1999. The Revolving Credit Agreement and certain of the industrial revenue bond issues contain customary covenants which include, among other things, maintenance of minimum tangible net worth and minimum working capital, restrictions on certain additional indebtedness and requirements to maintain certain financial ratios. At December 31, 1994, the Company was in compliance with these covenants. LEASES The Company and certain of its subsidiaries are committed under non-cancelable operating leases involving certain facilities and equipment. Aggregate rental expense for all leased assets was $2,359,000, $2,662,000 and $2,696,000 for the years ended December 31, 1994, 1993 and 1992, respectively. 21 24 MYERS INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) Future minimum rental commitments for the next five years are as follows:
YEAR ENDED DECEMBER 31, COMMITMENT ----------------------- ---------- 1995 $1,611,000 1996 1,078,000 1997 784,000 1998 295,000 1999 211,000
INCOME TAXES The effective tax rate was 40.7% in 1994, 39.5% in 1993 and 40.0% in 1992. A reconciliation of the Federal statutory income tax rate to the Company's effective tax rate is as follows:
PERCENT OF PRE-TAX INCOME -------------------------- 1994 1993 1992 ---- ---- ---- Statutory Federal income tax rate.................. 35.0% 35.0% 34.0% State income taxes -- net of Federal tax benefit... 4.7 4.6 5.0 Effect of non-deductible depreciation and amortization..................................... .6 .6 .9 FASB 109 adoption.................................. -- (.8) -- Other.............................................. .4 .1 .1 ---- ---- ---- Effective tax rate for the year.................... 40.7% 39.5% 40.0% ==== ==== ====
Income taxes consisted of the following:
1994 1993 1992 ------------------ ------------------ ------------------ CURRENT DEFERRED CURRENT DEFERRED CURRENT DEFERRED ------- -------- ------- -------- ------- -------- (DOLLARS IN THOUSANDS) Federal..................... $ 9,015 $812 $ 7,707 $414 $ 6,063 $911 Foreign..................... 225 (3) 122 (2) 100 (2) State and local............. 2,169 (3) 1,755 58 1,640 15 ------- -------- ------- -------- ------- -------- $11,409 $806 $ 9,584 $470 $ 7,803 $924 ======= ====== ====== ====== ====== ======
The transactions giving rise to deferred taxes in each of the three years in the period ended December 31, 1994 are as follows:
1994 1993 1992 ------ ------ ---- (DOLLARS IN THOUSANDS) Accelerated depreciation........................... $1,023 $1,149 $331 Undistributed earnings of a Domestic International Sales Corporation................................ (6) (6) (29) Compensation....................................... (215) 71 174 Employee benefits trust............................ (23) (127) (14) Inventory valuation................................ 147 (158) (25) Allowance for uncollectible accounts............... (62) (45) 109 Non deductible accruals............................ (58) (204) 378 FASB 109 adoption.................................. -- (210) -- ------ ------ ---- $ 806 $ 470 $924 ====== ====== ====
22 25 MYERS INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) INCOME TAXES Significant components of the Company's deferred tax liabilities as of December 31, 1994 and 1993 are as follows:
1994 1993 ------ ------ (DOLLARS IN THOUSANDS) Deferred income tax liabilities: Accelerated depreciation............................... $5,114 $4,091 Employee benefit trust................................. 227 250 Other.................................................. 81 127 ------ ------ 5,422 4,468 ------ ------ Deferred income tax assets: Compensation........................................... 1,135 920 Inventory valuation.................................... 671 818 Allowance for uncollectible accounts................... 488 426 Non deductible accruals................................ 258 240 ------ ------ 2,552 2,404 ------ ------ Net deferred income tax liability........................ $2,870 $2,064 ====== ======
At December 31, 1994, the Company had a net operating loss carryforward from an acquired company of $203,000 which does not begin to expire until 1996. The benefit related to this loss carryforward will result in the restoration of previously deferred taxes. The Company has reduced the excess of cost over fair value of net assets of companies acquired by $56,600 and $551,000 in 1993 and 1992, respectively, to reflect the realization of acquired net operating loss carryforwards and tax credits. Effective January 1, 1993, the Financial Accounting Standards Board Statement No. 109, "Accounting for Income Taxes," required the Company to change its method of accounting for income taxes to the asset and liability method. Under this method, deferred income taxes are recognized for the tax consequences of "temporary differences" by applying enacted statutory tax rates to differences between the financial statement carrying amounts and the tax basis of existing assets and liabilities. Under the Statement, the effect on deferred taxes of a change in tax rates is recognized in the tax provision in the period that includes the enactment date. Under the previously used method, deferred taxes were recognized using the tax rate applicable to the year of calculation and were not adjusted for subsequent rate changes. The adoption of this statement, which reduced income tax expense, resulted in additional net income of $210,000 or $.02 per share in 1993. STOCK OPTIONS In 1992, the Company adopted the 1992 Stock Option Plan allowing key employees to purchase Common Stock of the Company at the market price on the date of grant. The plan provides that stock options expire five years from date of grant and are exercisable up to 20 percent of the shares granted each year. The activity listed below covers both the 1992 Stock Option Plan and the 1982 Incentive Stock Option Plan which expired in 1992. Stock options granted during the past three years were as follows: during 1994, 97,545 shares at prices from $14.25 to $18.40; during 1993, 6,625 shares at prices from $15.82 to $19.30; during 1992, 42,570 shares at prices from $12.18 to $15.70. 23 26 MYERS INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) Stock options exercised during the past three years were as follows: during 1994, 35,195 shares at prices from $7.95 to $14.27; during 1993, 38,775 shares at prices from $5.16 to $14.27; during 1992, 61,690 shares at prices from $3.77 to $8.60. At December 31, 1994, 1993 and 1992 there were outstanding options for the purchase of 186,807, 135,135 and 186,365 shares respectively, at prices ranging from $7.95 to $19.30 per share in 1994 and 1993 and $5.16 to $15.70 per share in 1992. At December 31, 1994 and 1993, there were options for 80,722 and 81,200 shares, respectively that were exercisable. INDUSTRY SEGMENTS The Company operates principally in two areas of business, the first being the distribution of aftermarket repair products and services. These products are distributed both domestically through branches in major cities in the United States and in foreign countries where, in some cases, the Company has controlling interest in companies located in those countries. No single foreign country represents more than 10 percent of the total sales, income or assets of the Company. The second major area of the Company's business is polymer and metal products which are manufactured in Company-owned facilities and distributed through mass merchandisers, warehouse distributors, sales representatives and in-house salesmen, principally in the United States. Operating income before income taxes is total revenues less total operating expenses. In computing operating income for the major segments of the Company, general corporate overhead expense and interest expense are not included. The identifiable assets of each major segment of the Company include inventories, accounts receivable, net fixed assets, the excess of cost over fair value of net assets acquired, patents, and other intangible assets attributable to each segment. Corporate assets are principally land, buildings, computer equipment, cash and temporary cash investments 24 27 MYERS INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) The table sets forth information relating to the Company's operations for the years ended December 31, 1994, 1993 and 1992, as required by the Statement of Financial Accounting Standards No. 14.
1994 1993 1992 -------- -------- -------- (DOLLARS IN THOUSANDS) NET SALES Distribution of aftermarket repair products and services.............................................. $121,748 $107,214 $ 99,873 Manufacturing of polymer and metal products.............. 163,513 147,673 138,202 Intra-segment elimination................................ (11,207) (9,751) (8,820) -------- -------- -------- $274,054 $245,136 $229,255 ======== ======== ======== OPERATING INCOME BEFORE INCOME TAXES Distribution of aftermarket repair products and services.............................................. $ 11,387 $ 10,263 $ 7,779 Manufacturing of polymer and metal products.............. 24,418 20,594 19,505 Corporate................................................ (5,139) (4,317) (4,105) Interest expense-net..................................... (620) (1,091) (1,342) -------- -------- -------- $ 30,046 $ 25,449 $ 21,837 ======== ======== ======== IDENTIFIABLE ASSETS Distribution of aftermarket repair products and services.............................................. $ 46,966 $ 40,780 $ 39,617 Manufacturing of polymer and metal products.............. 121,635 108,549 97,816 Corporate................................................ 4,492 3,782 6,124 Intra-segment elimination................................ (1,066) (725) (1,476) -------- -------- -------- $172,027 $152,386 $142,081 ======== ======== ======== CAPITAL ADDITIONS, NET Distribution of aftermarket repair products and services.............................................. $ 942 $ 452 $ 1,104 Manufacturing of polymer and metal products.............. 11,071 13,449 15,457 Corporate................................................ 493 208 107 -------- -------- -------- $ 12,506 $ 14,109 $ 16,668 ======== ======== ======== DEPRECIATION/AMORTIZATION Distribution of aftermarket repair products and services.............................................. $ 598 $ 565 $ 412 Manufacturing of polymer and metal products.............. 7,949 6,249 5,275 Corporate................................................ 274 263 235 -------- -------- -------- $ 8,821 $ 7,077 $ 5,922 ======== ======== ========
25 28 MYERS INDUSTRIES, INC. EMPLOYEE STOCK PURCHASE PLAN CONTENTS Report of Independent Accountants for the Myers Industries, Inc. Employee Stock Purchase Plan Financial Statements for the Myers Industries, Inc. Employee Stock Purchase Plan: (1) Statements of Assets Available for Plan Benefits for the Years Ended December 31, 1994 and 1993; and (2) Statements of Changes in Assets Available for Plan Benefits for the Years Ended December 31, 1994, 1993 and 1992. Notes to Financial Statements for the Myers Industries, Inc. Employee Stock Purchase Plan 26 29 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Myers Industries, Inc. Employee Stock Purchase Plan Administrator: We have audited the accompanying statements of assets available for plan benefits of the Myers Industries, Inc. Employee Stock Purchase Plan as of December 31, 1994 and 1993, and the related statements of changes in assets available for plan benefits for each of the three years in the period ended December 31, 1994. These financial statements are the responsibility of the Plan Administrator. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the assets available for plan benefits of the Myers Industries, Inc. Employee Stock Purchase Plan as of December 31, 1994 and 1993, and the changes in its assets available for plan benefits for each of the three years in the period ended December 31, 1994, in conformity with generally accepted accounting principles. ARTHUR ANDERSEN LLP /s/ Arthur Andersen LLP Cleveland, Ohio, February 8, 1995 27 30 MYERS INDUSTRIES, INC. EMPLOYEE STOCK PURCHASE PLAN STATEMENTS OF ASSETS AVAILABLE FOR PLAN BENEFITS DECEMBER 31, 1994 AND 1993
1994 1993 ------- ------- Receivable from Trustee.......................................... $82,563 $77,438 (Myers Industries, Inc.)
STATEMENTS OF CHANGES IN ASSETS AVAILABLE FOR PLAN BENEFITS FOR THE YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992
1994 1993 1992 --------- --------- --------- Contributions: Participants' contributions beginning of period......... $ 77,438 $ 65,237 $ 46,601 Participants' contributions during the period........... 299,007 272,147 218,958 Assets Available for Stock Purchase..................... 376,445 337,384 265,559 Less: Assets Used for Stock Purchases......................... (293,882) (259,946) (200,322) --------- --------- --------- Assets Available for Plan Benefits at End of Period..... $ 82,563 $ 77,438 $ 65,237 ========= ========= =========
See accompanying notes to financial statements. 28 31 MYERS INDUSTRIES, INC. EMPLOYEE STOCK PURCHASE PLAN NOTES TO FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992 1. DESCRIPTION OF PLAN The following description of the Myers Industries, Inc. Employee Stock Purchase Plan ("Stock Plan") provides only general information. Participants should refer to the Plan Agreement and Prospectus for the Stock Plan for a more complete description of the Plan's provisions. (a) GENERAL. The shareholders of the Company approved the adoption of a nonqualified Employee Stock Purchase Plan at the April 28, 1986 Annual Meeting. The Stock Plan is designed to encourage, facilitate and provide employees with an opportunity to share in the favorable performance of the Company through ownership of the Company's Common Stock. The total number of shares of the Common Stock which may be sold under the Stock Plan is currently limited to 188,176 shares. (b) PURPOSE. The purpose of the Stock Plan is to provide employees (including officers) of the Company and its subsidiaries with an opportunity to purchase Common Stock through payroll deductions. (c) ADMINISTRATION. The Stock Plan is administered by a committee appointed by the Board of Directors. All questions of interpretation or application of the Stock Plan are determined by the Board of Directors (or its appointed committee) and its decisions are final, conclusive and binding upon all participants. (d) ELIGIBILITY AND PARTICIPATION. Any permanent employee (including an officer) who has been employed for at least one calendar year by the Company, or its subsidiaries who have adopted the Stock Plan, is eligible to participate in the Stock Plan, provided that such employee is employed by the Company on the date his participation is effective and subject to limitations on stock ownership described in the Stock Plan. Eligible employees become participants in the Stock Plan by delivering to the Company a subscription agreement authorizing payroll deductions prior to the commencement of the applicable offering period. (e) OFFERING DATES. The Stock Plan is generally implemented by one offering during each calendar quarter. Offering periods commence on the last day of each calendar quarter. The Board of Directors has the power to alter the duration of the offering periods without shareholder approval. (f) PURCHASE PRICE. The price at which shares may be purchased in an offering under the Stock Plan is 90% of the fair market value of the Common Stock on the last day of the prior calendar quarter. The fair market value of the Common Stock on a given date is the closing price for that date as listed on the American Stock Exchange. (g) PAYROLL DEDUCTIONS. The purchase price of the shares to be acquired under the Stock Plan will be accumulated by payroll deductions over the offering period. The rate of deductions may not be less than five dollars ($5.00) per week or exceed 10% of a participant's compensation, and the aggregate of all payroll deductions during the offering may not exceed 10% of the participant's aggregate compensation for the offering period. A participant may discontinue his participation in the Stock Plan or may decrease or increase the rate of payroll deductions at any time during the offering period by filing with the Company a new authorization for payroll deductions. All payroll deductions made for a participant are credited to his accounts under the Stock Plan and are deposited with the general funds of the Company to be used for any corporate purpose. The amount by which an employee's payroll deductions exceed the amount required to purchase whole shares will be placed in a suspense account for the employee with no interest thereon and rolled over into the next offering period. 29 32 MYERS INDUSTRIES, INC. EMPLOYEE STOCK PURCHASE PLAN NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) (h) WITHDRAWAL. A participant in the Stock Plan may terminate his interest in a given offering in whole, but not in part, by giving written notice to the Company of his election to withdraw at any time prior to the end of the applicable offering period. Such withdrawal automatically terminates the participant's interest in that offering, but does not have any effect upon such participant's eligibility to participate in subsequent offerings under the Stock Plan. (i) TERMINATION OF EMPLOYMENT. Termination of a participant's employment for any reason, including retirement or death, cancels his or her participation in the Stock Plan immediately. (j) NONASSIGNABILITY. No rights or accumulated payroll deductions of an employee under the Stock Plan may be pledged, assigned, transferred or otherwise disposed of in any way for any reason, other than on account of death. Any attempt to do so may be treated by the Company as an election to withdraw from the Stock Plan. (k) AMENDMENT AND TERMINATION OF THE PLAN. The Board of Directors may at any time amend or terminate the Stock Plan. Except as provided above, no amendment may be made to the Stock Plan without prior approval of the shareholders if such amendment would increase the number of shares reserved under the Stock Plan, permit payroll deductions at a rate in excess of 10% of a participant's compensation, materially modify the eligibility requirements or materially increase the benefits which may accrue to participants under the Stock Plan. (l) TAXATION. Participants in the Stock Plan, which is nonqualified for federal income tax purposes, are taxed currently on the 10% discount in the purchase price granted by the Stock Plan in the year in which stock is purchased. The 10% discount is treated as ordinary income to the participant and that amount is currently deductible by the Company to the extent the participant's total compensation from the Company is within the "reasonable compensation" limits imposed by Section 162 of the Internal Revenue Code of 1986, as amended. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) BASIS OF PRESENTATION. The accompanying statements of assets available for plan benefits and statements of changes in assets available for plan benefits are prepared on the accrual basis of accounting. (b) ADMINISTRATIVE EXPENSES. Administrative costs and expenses are absorbed by the Trustee. 30 33 PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT For information about the directors of the Registrant, see "Election of Directors" on pages 3 through 6 of Registrant's Proxy Statement dated March 23, 1995 ("Proxy Statement"), which is incorporated herein by reference. Information about the Executive Officers of Registrant appears in Part I of this Report. Disclosures by the Registrant with respect to compliance with Section 16(a) appear on pages 6 and 7 of the Proxy Statement, and are incorporated herein by reference. ITEM 11. EXECUTIVE COMPENSATION See "Executive Compensation and Other Information" on pages 7 through 10 of the Proxy Statement, which is incorporated herein by reference. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT See "Principal Shareholders" and "Election of Directors" at page 12, and pages 3 through 6, respectively, of the Proxy Statement, which are incorporated herein by reference. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS See "Certain Relationships and Related Transactions" at page 12 of the Proxy Statement, which is incorporated herein by reference. PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K The following consolidated financial statements of the Registrant appear in Part II of this Report: 14. (A)(1) FINANCIAL STATEMENTS CONSOLIDATED FINANCIAL STATEMENTS OF MYERS INDUSTRIES, INC. AND SUBSIDIARIES Report of Independent Public Accountants Statements of Consolidated Financial Position as of December 31, 1994 and 1993 Statements of Consolidated Income Years Ended December 31, 1994, 1993 and 1992 Statements of Consolidated Shareholders' Equity Years Ended December 31, 1994, 1993 and 1992 Statements of Consolidated Cash Flows Years Ended December 31, 1994, 1993 and 1992 Notes to Consolidated Financial Statements Years Ended December 31, 1994, 1993 and 1992 FINANCIAL STATEMENTS FOR THE MYERS INDUSTRIES, INC. EMPLOYEE STOCK PURCHASE PLAN Statements of Assets Available for Plan Benefits Years Ended December 31, 1994 and 1993 Statements of Changes in Assets Available for Plan Benefits Years Ended December 31, 1994, 1993 and 1992 14. (A)(2) FINANCIAL STATEMENT SCHEDULES Selected Quarterly Financial Data Years Ended December 31, 1994 and 1993 31 34 The following consolidated financial statement schedules of the Registrant are included in Item 14(d): Report of Independent Public Accountants on the Financial Statement Schedules Schedule II - Valuation and Qualifying Accounts and Reserves Years Ended December 31, 1994, 1993 and 1992 All other schedules are omitted because they are inapplicable, not required, or because the information is included in the consolidated financial statements or notes thereto which appear in Part II of this Report. 14. (A)(3) EXHIBITS 3(a) MYERS INDUSTRIES, INC. AMENDED AND RESTATED ARTICLES OF INCORPORATION. Reference is made to Exhibit (3)(i) to Form 8-K filed with the Commission on May 14, 1994. 3(b) MYERS INDUSTRIES, INC. AMENDED AND RESTATED CODE OF REGULATIONS. Reference is made to Exhibit (3)(ii) to Form 8-K filed with the Commission on May 14, 1994. 10(a) MYERS INDUSTRIES, INC. AMENDED AND RESTATED 1982 INCENTIVE STOCK OPTION PLAN (b) MYERS INDUSTRIES, INC. EMPLOYEE STOCK PURCHASE PLAN (c) FORM OF INDEMNIFICATION AGREEMENT FOR DIRECTORS AND OFFICERS (d) MYERS INDUSTRIES, INC. 1992 STOCK OPTION PLAN (e) MYERS INDUSTRIES, INC. DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN 21 Subsidiaries of the Registrant 23 Consent of Independent Public Accountants 27 Financial Data Schedule EXECUTIVE COMPENSATION PLANS AND ARRANGEMENTS
PLAN OR ARRANGEMENT REFERENCE LOCATION ------------------------------------------ --------------------------------------------------- Myers Industries, Inc. Amended Exhibit (10)(a) to Form 10-K Restated 1982 Incentive Stock Option Plan for fiscal year ended December 31, 1994 Myers Industries, Inc. 1992 Exhibit 10(d) to Form 10-K Stock Option Plan for fiscal year ended December 31, 1994
14.(B) REPORTS ON FORM 8-K: None 14.(C) EXHIBITS: See subparagraph 14(a)(3) above. 32 35 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS ON THE FINANCIAL STATEMENT SCHEDULE To Myers Industries, Inc.: We have audited in accordance with generally accepted auditing standards, the financial statements included in Myers Industries, Inc.'s annual report to shareholders included in this Form 10-K, and have issued our report thereon dated February 8, 1995. Our audit was made for the purpose of forming an opinion on those statements taken as a whole. The schedule listed under item 14(a)(2) of this Form 10-K is the responsibility of the Company's management and is presented for purposes of complying with the Securities and Exchange Commission's rules and is not part of the basic financial statements. This schedule has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, fairly states in all material respects the financial data required to be set forth therein in relation to the basic financial statements taken as a whole. ARTHUR ANDERSEN LLP /s/ Arthur Andersen LLP Cleveland, Ohio February 8, 1995 33 36 14.(D) FINANCIAL STATEMENTS AND SCHEDULES: SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS AND RESERVES FOR YEARS ENDED DECEMBER 31, 1994, 1993 AND 1992
ADDITIONS ---------------------- CHARGED CHARGED BALANCE AT TO COSTS TO OTHER BALANCE BEGINNING AND ACCOUNT DEDUCTIONS AT END DESCRIPTION OF PERIOD EXPENSES (DESCRIBED) (DESCRIBED) OF PERIOD -------------------------------------- ---------- -------- ----------- ---------- ---------- Allowance for Doubtful Accounts 1992.................................. $1,720,000 $661,197 $ -0- $998,197(1) $1,383,000 1993.................................. $1,383,000 $900,796 $ -0- $758,796(1) $1,525,000 1994.................................. $1,525,000 $711,683 $ -0- $757,683(1) $1,479,000 --------------- (1) Represents the write-off of uncollectible accounts receivable.
34 37 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. MYERS INDUSTRIES, INC. Dated: March 23, 1995 By: /s/ Gregory J. Stodnick ------------------------------ GREGORY J. STODNICK Vice President -- Finance and Chief Financial Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
SIGNATURE TITLE DATE --------- ----- ---- /s/ GREGORY J. STODNICK Vice President -- Finance and March 23, 1995 ------------------------------------------ Chief Financial Officer (Principal GREGORY J. STODNICK Financial and Accounting Officer) /s/ STEPHEN E. MYERS President, Chief Executive March 23, 1995 ------------------------------------------ Officer and Director STEPHEN E. MYERS (Principal Executive Officer) Director March , 1995 ------------------------------------------ EDWIN P. SCHRANK /s/ KARL S. HAY Director March 23, 1995 ------------------------------------------ KARL S. HAY /s/ MILTON I. WISKIND Senior Vice President, March 23, 1995 ------------------------------------------ Secretary and Director MILTON I. WISKIND Director March , 1995 ------------------------------------------ RICHARD L. OSBORNE /s/ SAMUEL SALEM Director March 23, 1995 ------------------------------------------ SAMUEL SALEM /s/ JON H. OUTCALT Director March 23, 1995 ------------------------------------------ JON H. OUTCALT Director March , 1995 ------------------------------------------ RICHARD P. JOHNSTON
35 38 INDEX OF EXHIBITS
EXHIBIT NO. ----------- 3(a) MYERS INDUSTRIES, INC. AMENDED AND RESTATED ARTICLES OF INCORPORATION. Reference is made to Exhibit (3)(i) to Form 8-K filed with the Commission on May 14, 1994. (b) MYERS INDUSTRIES, INC. AMENDED AND RESTATED CODE OF REGULATIONS. Reference is made to Exhibit (3)(ii) to Form 8-K filed with the Commission on May 14, 1994. 10(a) MYERS INDUSTRIES, INC. AMENDED AND RESTATED 1982 INCENTIVE STOCK OPTION PLAN (b) MYERS INDUSTRIES, INC. EMPLOYEE STOCK PURCHASE PLAN (c) FORM OF INDEMNIFICATION AGREEMENT FOR DIRECTORS AND OFFICERS (d) MYERS INDUSTRIES, INC. 1992 STOCK OPTION PLAN (e) MYERS INDUSTRIES, INC. DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN 21 Subsidiaries of the Registrant 23 Consent of Independent Public Accountants 27 Financial Data Schedule
36 EX-10.A 2 MYERS INDUSTRIES 10-K405 EXHIBIT 10(A) 1 EXHIBIT 10(a) MYERS INDUSTRIES, INC. AMENDED AND RESTATED 1982 INCENTIVE STOCK OPTION PLAN 2 MYERS INDUSTRIES, INC. AMENDED AND RESTATED 1982 INCENTIVE STOCK OPTION PLAN July 18, 1989 3 TABLE OF CONTENTS ITEM PAGE Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . 1 The Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Purpose . . . . . . . . . . . . . . . . . . . . . . . . 2 Administration . . . . . . . . . . . . . . . . . . . . 2 Shares Subject to the Plan . . . . . . . . . . . . . . 2 Optionees and Allotment of Shares . . . . . . . . . . . 3 Option Price . . . . . . . . . . . . . . . . . . . . . 4 Option Period . . . . . . . . . . . . . . . . . . . . . 5 Limitations Upon Exercise of Option . . . . . . . . . . 6 Options to Conform With Code . . . . . . . . . . . . . 6 Method of Exercise and Time of Payment . . . . . . . . 7 Effect of Changes in Shares Subject to the Plan . . . . 7 Non-Assignability . . . . . . . . . . . . . . . . . . . 8 Use of Proceeds . . . . . . . . . . . . . . . . . . . . 8 Right to Terminate Employment . . . . . . . . . . . . . 8 Modification of Option . . . . . . . . . . . . . . . . 8 Amendment and Discontinuance of Plan . . . . . . . . . 8 Effective Date . . . . . . . . . . . . . . . . . . . . 9 4 MYERS INDUSTRIES, INC. AMENDED AND RESTATED 1982 INCENTIVE STOCK OPTION PLAN DEFINITIONS As used in this instrument, the following words shall have the following meanings: The "Plan" shall mean this Myers Industries, Inc. 1982 Incentive Stock Option Plan, as it may be amended from time to time. The "Corporation" shall mean Myers Industries, Inc. The "Board" shall mean the Board of Directors of the Corporation. The "Committee" shall mean a committee of not less than three (3) members of the Board who shall be appointed from time to time by the Board. The "Optionee" or "Optionees" shall mean those Key Employees of the Corporation to whom options are granted. The "Option Period" shall mean that period during which an option may be exercised. The "Code" shall mean the Internal Revenue Code of 1986, and any reference to such Code shall be deemed to include all amendments thereof. The "Act" shall mean the Federal Securities Act of 1933, and any reference to such Act shall be deemed to include all amendments thereof. "Subsidiary" shall mean any present or future subsidiary of the Corporation (as that term is defined in Section 425 of the Code). The "Key Employees" shall mean those employees of the Corporation or any Subsidiary who the Committee ascertains are key employees of the Corporation. "Common Shares" shall mean the Common Shares of the Corporation without par value. -1- 5 THE PLAN 1. PURPOSE This Plan is intended as an incentive to encourage stock ownership by certain Key Employees. The Plan is intended to allow such Key Employees to acquire or to increase their proprietary interest in the Corporation and to encourage them to remain in the employ of the Corporation or a Subsidiary. It is further intended that the options issued pursuant to this Plan shall (i) qualify as Incentive Stock Options within the meaning of Section 422A of the Code, or (ii) not qualify as Incentive Stock Options within the meaning of Section 422A of the Code. 2. ADMINISTRATION The Plan shall be administered by the Committee, and members of the Committee shall not be eligible to participate in the Plan. The Committee is authorized (but only to the extent not contrary to the express provisions of the Plan) to interpret the Plan, to prescribe, amend, and rescind rules and regulations relating to the Plan, to determine the form and content of options to be issued under the Plan, to make such determinations as are hereinafter expressly provided to be determined by the Committee, and to take such other action as the Committee shall consider necessary or advisable for the administration of the Plan. A majority of the Committee shall constitute a quorum, and the action of a majority of the members of the Committee present at any meeting at which a quorum is present, or acts unanimously approved in writing, shall be acts of the Committee. No member of the Committee shall be liable for any action or determination made in good faith with respect to the Plan or any option granted under it. 3. SHARES SUBJECT TO THE PLAN Except as otherwise provided in Section 10 hereof, the Committee, from time to time, may provide for the option and sale in the aggregate of up to 152,685 (as adjusted for stock splits and stock dividends) Common Shares without par value of the Corporation, subject, however, to adjustments as provided in Section 10 of the Plan. If an option ceases to be exercisable in whole or in part for any reason, the Common Shares which were subject to such option but as to which the option had not been exercised shall continue to be available under the Plan. Common Shares shall be made available from authorized and unissued Common Shares or treasury shares. Each option granted under the Plan shall be subject to the requirement and condition that if the Board shall determine that the listing, registration or qualification upon any securities exchange under any state or federal law, or the approval or consent of any governmental body is necessary or desirable as a condition of granting such option, or the issue or purchase of any shares thereunder, then no such option may be exercised in whole or in part unless or until such listing, registration, qualification or approval has been obtained, free of any conditions which are not acceptable to the Board of the Corporation. -2- 6 4. OPTIONEES AND ALLOTMENT OF SHARES From time to time the Committee shall determine and designate those Key Employees to whom options are to be granted, the number of Common Shares to be offered to each, and the respective dates upon which such options shall be granted; provided, however, that no option may be granted hereunder after December 31, 1991. The Committee, with the approval of the Board, may grant the right to the employee to receive additional compensation (in cash or property) at the time of exercise of the incentive stock option or other stock option so long as the additional amount is subject to inclusion in the employee's gross income under the provisions of Sections 61 and 83 of the Code. Directors of the Corporation who are not otherwise officers or employees of the Corporation shall not be eligible to participate in the Plan. The options shall contain such conditions and restrictions as to the purchase and delivery of shares as the Committee may deem advisable for the protection of the Corporation, subject to the general directions in Section 8 of this Plan. The aggregate fair market value of the Common Shares with respect to which incentive stock options may be granted to any employee under this Plan shall be limited as follows: (a) In the case of options granted hereunder on or before December 31, 1987, the aggregate fair market value (determined as of the time the options are granted) of the Common Shares for which any employee may be granted incentive stock options in any calendar year (under all incentive stock option plans of the Corporation and its parent, if any, and subsidiary or subsidiaries) shall not exceed $100,000 plus any unused limit carryover to such year. If $100,000 exceeds the aggregate fair market value (determined as of the time the options are granted) of the Common Shares for which an employee was granted options in any calendar year after 1980 (under all plans described in Section 422A(b)(2) of the Code of his employer corporation and its parent and subsidiary corporation) one-half of such excess shall be an unused limit carryover to each of the three succeeding calendar years. The amount of the unused limit carryovers from any calendar year which may be taken into account in any succeeding calendar year which may be taken into account in any succeeding calendar year shall be the amount of such carryover reduced by the amount of such carryover which was used in prior calendar years. For purposes of the preceding sentence, the amount of options granted during any calendar year shall be treated as first using up the $100,000 current year limitation, and then shall be treated as using up unused limit carryovers to such year in the order of the calendar years in which the carryovers arose. (b) In the case of an option granted hereunder after December 31, 1987, the aggregate fair market value (determined at the time the options are granted) of the Common Shares with respect to which such options are exercisable for the first time by the employee during any calendar year (under all incentive stock option plans of his or her employer corporation and its parent and subsidiary corporations) shall not exceed $100,000. -3- 7 No option shall be granted to any employee who, immediately before the grant, owns (within the meaning of Section 425(d) of the Code) shares representing more than 10 percent of the total combined voting power of all classes of stock of the Corporation or its parent or subsidiaries. However, this restriction shall not apply if, notwithstanding Section 5 or 6 or any other provision of this Plan, the price of any such option is at least 110 percent of the fair market value (at the time the option is granted) of the shares subject to the option and the option by its terms is not exercisable more than five (5) years from the date it is granted. Nothing contained in this Section 4 shall be deemed to prevent the grant of nonqualified stock options in excess of the maximum established by Section 422A of the Code. 5. OPTION PRICE The option price of each of the Common Shares of the Corporation which shall be offered from time to time shall be not less than 100 percent of the fair market value of the shares at the time the option is granted. Such fair market value shall be determined as follows: (a) If at the time of the grant of any option hereunder, there is a market for the Common Shares of the Corporation on a stock exchange, on an over-the-counter market, or otherwise, the mean between the highest and lowest quoted selling prices on the valuation date shall be the fair market value per share. If there were no sales on the valuation date, but there were sales on dates within a reasonable period both before and after the valuation date, the fair market value is determined by taking a weighted average of the means between the highest and lowest sales on the nearest date before and the nearest date after the valuation date. The average is to be weighted inversely by the respective numbers of trading days between the selling dates and the valuation date. For example, assume that sales of stock nearest the valuation date (Friday, June 15) occurred two trading days before (Wednesday, June 13) and three trading days after (Wednesday, June 20) and that on these days the mean sale prices per share were $10 and $15, respectively. The price of $12 shall be taken as representing the fair market value of a share of the stock as of the valuation date determined as follows: (3 x 10) + (2 x 15) ------------------- 5 If, instead, the mean sale prices per share on June 13 and June 20 were $15 and $10, respectively, the price of $13 shall be taken as representing the fair market value determined as follows: (3 x 15) + (2 x 10) ------------------- 5 (b) If the provisions of Subsection (a) of this Section are inapplicable because actual sales are not available during a reasonable period beginning before and ending after the valuation date, the fair market value shall be determined by taking the mean -4- 8 between the bona fide bid and asked prices on the nearest trading date before and the nearest trading date after the valuation date, if both such nearest dates are within a reasonable period. The average is to be determined in the manner described in Subsection (a) of this Section. If there are no actual sale prices or bona fide bid and asked prices available on a date within a reasonable period before the valuation date, but such prices are available on a date within a reasonable period after the valuation date, or vice versa, then the mean between the highest and lowest available sale prices or bid and asked prices shall be taken as the value. (c) If at the time of the grant of any option hereunder the Common Shares of the Corporation are not listed on a stock exchange or if there is no public market for the Common Shares of the Corporation, or if selling prices or bid and asked prices do not reflect fair market value, the fair market value of such shares shall be determined by the Committee. For the purpose of this Plan, the day on which the Committee approves the granting of an option shall be considered the date on which such option is granted. 6. OPTION PERIOD The Option Period shall commence on the day on which the Committee approves the granting of the option and shall end not more than ten (10) years from the date on which an option hereunder is granted; subject, however, to the following: (a) If, following the commencement of the Option Period the employment of an Optionee shall be terminated, all rights to purchase Common Shares pursuant to such option (including rights to purchase Common Shares thereunder which have accrued, but which at such time remain unexercised) shall forthwith cease and terminate; provided, however, that: (i) if such termination of employment should occur as a result of such Optionee's disability or such retirement as shall be approved by the Corporation or by any Subsidiary by whom such Optionee was employed, such option may be exercised by him at any time prior to the expiration date of the option, or prior to the expiration of three (3) months (twelve (12) months in the case of an employee who is disabled within the meaning of Section 105(d)(4) of the Code) after the date of such termination, whichever shall first occur, and (ii) if such termination shall occur as the result of the Death of an Optionee, his option shall be exercisable only by the executor, administrator, or other qualified personal representative of his estate, or by such person who acquired the right to exercise such option by bequest or inheritance or by reason of the death of such Optionee; and in such event, the option may be exercised only prior to the end of the Option Period, or within a period ending on the last day of the sixth month following the death of such Optionee, whichever shall first occur. -5- 9 (b) If at any time the Committee shall determine that an Optionee has intentionally committed an act materially adverse to the interests of the Corporation, the Committee shall notify the Optionee and concurrently with said notice his option shall thereupon become null, void, and of no effect. 7. LIMITATIONS UPON EXERCISE OF OPTION During the Option Period applicable to any option hereunder, such option shall be exercisable at the time and only as to the number of Common Shares, as follows: (a) At any time during the first year of the Option Period, but within the Option Period -- up to twenty percent (20%) of the number of Common Shares pertaining to such option. (b) At any time during the second year of the Option Period, but within the Option Period -- up to an additional twenty percent (20%) of the number of Common Shares pertaining to such option. (c) At any time during the third year of the Option Period, but within the Option Period -- up to an additional twenty percent (20%) of the number of Common Shares pertaining to such option. (d) At any time during the fourth year of the Option Period, but within the option Period -- up to an additional twenty percent (20%) of the number of Common Shares pertaining to such option. (e) At any time after the fourth year of the Option Period, but within the Option Period -- up to the remainder of the number of Common Shares pertaining to such option which have not yet been purchased during the first four years. If any of the events referred to in Subsection 6(a) occur, such options shall be exercisable after termination of employment or death, as the case may be, subject to the appropriate Option Period therein provided, only as to the number of Common Shares as to which such option is exercisable under this Section 7 immediately prior to such termination of employment or death. 8. OPTIONS TO CONFORM WITH CODE The qualified incentive stock options granted under this Plan may contain such provisions as are deemed advisable to permit qualification as "Incentive Stock Options" within the meaning of Section 422A(b) of the Code, and such Incentive Stock Options may be amended, if necessary, to permit such qualification. In no event shall such Incentive Stock Options be exercisable after the expiration of such period as may be permissible with respect to Incentive Stock Options. -6- 10 With respect to Incentive Stock Options granted on or before December 31, 1987, no option shall be exercisable while there is outstanding any Incentive Stock Option which was granted before the granting of the option sought to be exercised by the Optionee to whom such latter option is granted to purchase Common Shares in the Corporation or in a corporation which, at the time the option sought to be exercised is granted, is a parent or subsidiary of the Corporation, or is a predecessor corporation of the Corporation or of such parent or subsidiary corporation. For purposes of this paragraph, an option shall be treated as "outstanding" until such option is exercised in full or expires by reason of lapse of time. Options which are granted or amended, and not meant to qualify as Incentive Stock Options, shall not be subject to this provision. 9. METHOD OF EXERCISE AND TIME OF PAYMENT An option granted pursuant to this Plan may be exercised, subject to the provisions relative to its termination and limitations on its exercise, from time to time only by (a) written notice to exercise the option with respect to a specified number of Common Shares, (b) payment to the Corporation in cash, by check, or with shares of stock of the Corporation (contemporaneously with delivery of each such notice) of the full amount of the option price of the number of Common Shares with respect to which the option is then being exercised, and (c) if the Corporation shall so require, written representation that the Common Shares received upon the exercise of the option are being acquired for investment and with no present view to the redistribution or resale of them within the meaning of the Act. Any stock of the Corporation used to pay for shares acquired upon exercise of an option granted herein shall be valued on the date of exercise at fair market value as determined in Section 5 of this Plan. Each such notice, payment, and representation shall be delivered, or mailed by prepaid registered mail, addressed to the treasurer of the Corporation at the Corporation's executive offices in Akron, Ohio. The date of receipt shall be deemed the date of exercise. 10. EFFECT OF CHANGES IN SHARES SUBJECT TO THE PLAN The number of Common Shares available for option, the number of Common Shares covered by each outstanding option, and the price per Common Share thereof in each such option, shall be proportionately adjusted to reflect any increase or decrease in the number of issued Common Shares of the Corporation resulting from a subdivision or consolidation of Common Shares, the declaration of share dividends, or recapitalization resulting in share split-ups or combinations or exchanges of Common Shares, or any other increase or decrease in the number of such shares effected without receipt of consideration by the Corporation. If the Corporation shall be the surviving corporation in any merger or consolidation, each outstanding option shall pertain and apply to the security to which a holder of the number of Common Shares subject to the option would have been entitled. A dissolution or liquidation of the Corporation, or a merger or consolidation in which the Corporation is not the surviving corporation, shall cause each outstanding option to terminate, provided that during the Option Period each Optionee shall have the right immediately prior to such dissolution or liquidation, -7- 11 or merger or consolidation in which the Corporation is not the surviving corporation, to exercise his option in whole or in part without regard to the installment provisions of Section 7 of this Plan. 11. NON-ASSIGNABILITY Options granted under this Plan are not transferable otherwise than by will or the laws of descent and distribution, and during the lifetime of any Optionee such option shall be exercisable only by him. 12. USE OF PROCEEDS The proceeds received by the Corporation from the sale of Common Shares pursuant to this Plan will be used for its general corporate purposes. 13. RIGHT TO TERMINATE EMPLOYMENT The Plan shall not confer upon any employee any right with respect to being continued in the employ of the Company and its subsidiaries or to interfere in any way with the right of the Company and its subsidiaries, to terminate his employment at any time, nor shall it interfere in any way with the employee's rights to terminate his employment. 14. MODIFICATION OF OPTION At any time and from time to time, the Committee with the consent of an Optionee may direct execution of an instrument providing for the modification, extension, or renewal of any outstanding option, provided no such modification, extension, or renewal shall confer upon the Optionee any right or benefit which could not be conferred on him by the grant of a new option at such time; and provided, further, that no modification shall be made which shall specify a lower option price or in any manner have the effect of disqualifying such option as an Incentive Stock Option within the meaning of Section 422A(b) of the Code, but only, to the extent such stock option is intended to qualify as an Incentive Stock Option. 15. AMENDMENT AND DISCONTINUANCE OF PLAN The Board shall have the right to amend, suspend, or terminate this Plan at any time, provided, however, that no such action shall affect or in any way impair the rights of an Optionee under any option theretofore granted under the Plan, and provided further, that unless first duly approved by the common shareholders of the Corporation entitled to vote thereon at a meeting (which may be the annual meeting) duly ca]led and held for such purpose, no amendment or change shall be made in the Plan (a) increasing the total number of shares which may be purchased under the Plan; (b) changing the minimum purchase price hereinbefore specified for the optioned shares; (c) changing the Option Period; or (d) changing the time limitation on the granting of options under the Plan hereinbefore specified. -8- 12 16. EFFECTIVE DATE The Plan was adopted by the Board on March 11, 1982. The effective date of this Plan is April 23, 1982. The Plan was approved by the shareholders of the Corporation entitled to vote on April 23, 1982. The Plan was Amended and Restated by the Board on January 29, 1988. The Plan was Amended and Restated by the Shareholders on April 26, 1989. The Plan was Amended and Restated by the Board on July 18, 1989. -9- EX-10.B 3 MYERS INDUSTRIES 10-K405 EXHIBIT 10(B) 1 EXHIBIT 10(b) MYERS INDUSTRIES, INC. EMPLOYEE STOCK PURCHASE PLAN 2 MYERS INDUSTRIES, INC. EMPLOYEE STOCK PURCHASE PLAN Myers Industries, Inc., an Ohio corporation (hereinafter referred to as the "Company"), hereby adopts the Myers Industries, Inc. Employee Stock Purchase Plan (hereinafter referred to as the "Plan") which shall contain the following terms and conditions: 1. PURPOSE The Plan is intended as an incentive to encourage stock ownership in the Company by all employees of the Company and its affiliates so that they may acquire or increase their proprietary interest in the success of the Company and to encourage them to remain in the employ of the Company. 2. TERM OF THE PLAN The Plan will continue from year to year but it may be modified or discontinued by the Company at any time. 3. ADMINISTRATION The Plan will be administered by a committee appointed by the Board of Directors of the Company (hereinafter referred to as the "Committee"). The Committee shall consist of not less than three (3) members of the Company's Board of Directors. The Board of Directors may, from time to time, remove members from, or add members to, the Committee. Vacancies on the Committee, howsoever caused, shall be filled by the Board of Directors. Acts of a majority of the Committee at a meeting at which a quorum is present, or acts reduced to or approved in writing by a majority of the members of the Committee, shall be valid acts of the Committee. The interpretation and construction by the Committee of any provisions of the Plan shall be final unless otherwise determined by the Board of Directors. No member of the Board of Directors of the Committee shall be liable for any action or determination made in good faith with respect to the Plan. 4. ELIGIBILITY All employees of the Company, or any of its affiliates, who have been continuously in the employment of the Company, or any of its affiliates, for a period of at least one (1) year shall be eligible to participate in the Plan (hereinafter referred to as "Eligible Employees"). 3 5. STOCK The stock subject to the Plan shall be shares of the Company's authorized but unissued common stock without par value (hereinafter referred to as the "Common Stock") or shares of the Common Stock held as treasury shares by the Company. The aggregate number of shares that may be purchased under this Plan shall not exceed 65,000 shares of Common Stock. 6. PARTICIPATION Eligible Employees who wish to participate in the Plan shall execute a form to be furnished by the Company indicating that they authorize and instruct the Company to deduct from their weekly or semi-monthly pay a specified amount, to be applied to the purchase of the Company's Common Stock for each individual's account. Payroll deductions may not be less than Five and no/100ths Dollars ($5.00) per week and not more than ten percent (10%) of the Eligible Employee's salary and wages. Payroll deductions may be made in whole dollar amounts only and the amount of payroll deductions may be changed or terminated by the participant at any time subject to the limitations set forth above. Payroll deductions, or revisions thereto, will be effective and will commence with pay checks issued not later than the second pay period following receipt of the participant's signed payroll deduction authorization or notice. 7. PURCHASE OF STOCK During the term of this Plan and on the last day of each calendar quarter, the Company shall apply the funds received from each participating Eligible Employee during the quarter towards the purchase from the Company of Common Stock. The purchase price to be paid to the Company for each share of Common Stock purchased under the Plan shall be ninety percent (90%) of the fair market value of a share of Common Stock as indicated by the closing price of a share of Common Stock as quoted by the American Stock Exchange at the close of business on the last day of the quarter. The funds allocated to each participant in the Plan shall be applied toward the purchase of the greatest number of whole shares of Common Stock that can be purchased using the purchase price determined in accordance with this Paragraph. If the funds allocated to a participant are not sufficient to purchase a whole share of Common Stock or if the funds allocated to a participant are not evenly divisible into the purchase price of whole shares of Common Stock, the participants funds or the balance remaining after purchase of the greatest number of whole shares of Common Stock, as the case may be, will be retained by the Company in a non-interest bearing suspense account until the last day of the next quarter when such funds, along with any other funds received from the participant during the quarter, shall be applied towards the purchase of Common Stock in accordance with this Paragraph. If the aggregate number of whole shares of Common Stock that may be purchased on the last day of the quarter would cause the aggregate number of shares of Common Stock purchased pursuant to this Plan during its term to exceed the limit set forth in Paragraph 5 of this Plan, the number of shares that may be purchased by the Company on behalf of the participants shall be reduced so that such limit is not exceeded. In such event, the shares purchased shall be allocated to a Plan participant in the same proportion as the funds held by the Company on behalf of the participant bears to the total of the funds held by the Company on behalf of all participants in 4 the Plan and the balance of the funds credited to each participant shall be refunded to the participants. 8. ISSUANCE OF STOCK CERTIFICATES Stock certificates for Common Stock purchased by participants pursuant to this Plan, shall be issued in the name of the participant on or before the last day of the quarter following the quarter in which a purchase of Common Stock is made in the name of the participant. 9. RIGHTS OF A STOCKHOLDER A participant in this Plan shall have no rights as a stockholder in the Company with respect to any shares purchased pursuant to this Plan until the date of issuance of a stock certificate to him or her for the shares so purchased. No adjustment shall be made for dividends (ordinary, extraordinary, whether in cash, securities or other property) or distributions or other rights for which the record date is prior to the date such stock certificate is issued. 10. TERMINATION In the event that a participant dies, terminates his or her employment with the Company or elects to withdraw from the Plan for any reason, or the Company discontinues the Plan, all shares of Common Stock standing in the name of the participant or purchased on behalf of the participant prior to such event, shall be transferred to the participant or to his order, or in the event of the participant's death, to the participant's legal representative. Cash held in the name of participant that has not been used to purchase Common Stock will promptly be refunded to the participant or to his legal representative, as the case may be. 11. AMENDMENT TO THE PLAN The Board of Directors of the Company may, in their sole discretion and to the extent permitted by law, from time to time, amend, revise or discontinue the Plan in any respect whatsoever. 12. APPLICATION OF FUNDS The proceeds received by the Company from the sale of Common Stock to participants in the Plan will be used for general corporate purposes. 13. GOVERNING LAW This Plan shall be construed under and governed by the laws of the State of Ohio. 5 14. CONSTRUCTION In the event that any of the provisions of this Plan are determined to be void or unenforceable by a court of competent jurisdiction, this Plan shall not become void in its entirety as a result of such determination, but shall be construed as if such void or unenforceable provision was not originally a part of the Plan. 15. SUCCESSORS This Plan shall be binding upon the Company and the participants and their respective heirs, successors, legal representatives, administrators and assigns. IN WITNESS WHEREOF, the Company has caused the Plan to be duly executed the day and year above first written. MYERS INDUSTRIES, INC. By: /s/ Stephen E. Myers ----------------------------- Its President Attest: /s/ Milton I. Wiskind ------------------------- EX-10.C 4 MYERS INDUSTRIES 10-K405 EXHIBIT 10(C) 1 EXHIBIT 10(c) MYERS INDUSTRIES, INC. FORM OF INDEMNIFICATION AGREEMENT FOR DIRECTORS AND OFFICERS 2 INDEMNIFICATION AGREEMENT THIS INDEMNIFICATION AGREEMENT made this ___ day of ______ 19__, between Myers Industries, Inc., an Ohio corporation (the "Company") and ______________, a director, officer, employee, agent or representative (as hereinafter defined) of the Company (the "Indemnitee"). R E C I T A L S: A. The Company and the Indemnitee are each aware of the exposure to litigation of officers, directors, employees, agents and representatives of the Company as such persons exercise their duties to the Company; B. The Company and the Indemnitee are also aware of conditions in the insurance industry that have affected and may continue to affect the Company's ability to obtain appropriate liability insurance on an economically acceptable basis; C. The Company desires to continue to benefit from the services of highly qualified, experienced and otherwise competent persons such as the Indemnitee; D. The Indemnitee desires to serve or to continue to serve the Company as a director, officer, employee, or agent or as a director, officer, employee, agent, or trustee of another corporation, joint venture, trust or other enterprise in which the Company has a direct or indirect ownership interest, for so long as the Company continues to provide, on an acceptable basis, adequate and reliable indemnification against certain liabilities and expenses which may be incurred by the Indemnitee. NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants herein contained, the parties hereto agree as follows: 1. INDEMNIFICATION. The Company shall indemnify the Indemnitee with respect to his activities as a director, officer, employee or agent of the Company and/or as a person who is serving or has served at the request of the Company ("representative") as a director, officer, employee, agent or trustee of another corporation, joint venture trust or other enterprise, domestic or foreign, in which the Company has a direct or indirect ownership interest (an "affiliated entity") against expenses (including, without limitation, attorneys' fees, judgments, fines and amounts paid in settlement) actually and reasonably incurred by him ("Expenses") in connection with any claim against Indemnitee which is the subject of any threatened, pending or completed action, suit or other type of proceeding, whether civil, criminal, administrative, investigative or otherwise and whether formal or informal (a "Proceeding"), to which Indemnitee was, is or is threatened to be made a party by reason of facts which include Indemnitee's being or having been such a director, officer, employee, agent or representative, to the extent of the highest and most advantageous to the Indemnitee, as determined by the Indemnitee, of one or any combination of the following: 3 (a) The benefits provided by the Company's Amended Code of Regulations ("Regulations") in effect on the date hereof, a copy of the relevant portions of which are attached hereto as Exhibit A; (b) The benefits provided by the Amended and Restated Articles of Incorporation, Regulations or their equivalent of the Company in effect at the time Expenses are incurred by Indemnitee; (c) The benefits allowable under Ohio law in effect at the date hereof; (d) The benefits allowable under the law of the jurisdiction under which the Company exists at the time Expenses are incurred by the Indemnitee; (e) The benefits available under any liability insurance obtained by the Company; and (f) Such other benefits as are or may be otherwise available to Indemnitee. Combination of two or more of the benefits provided by (a) through (f) shall be available to the extent that the Applicable Document, as hereafter defined, does not require that the benefits provided therein be exclusive of other benefits. The document or law providing for the benefits listed in items (a) through (f) above is called the "Applicable Document" in this Agreement. Company hereby undertakes to use its best efforts to assist Indemnitee, in all proper and legal ways, to obtain the benefits selected by Indemnitee under item (a) through (f) above. For purposes of this Agreement, references to "other enterprises" shall include employee benefit plans for employees of the Company or of any affiliated entity without regard to ownership of such plans; references to "fines" shall include any excise taxes assessed on the Indemnitee with respect to any employee benefit plan; references to "serving at the request of the Company" shall include any service as a director, officer, employee or agent of the Company which imposes duties on, or involves services by, the Indemnitee with respect to an employee benefit plan, its participants or beneficiaries; references to the masculine shall include the feminine; references to the singular shall include the plural and vice versa; and if the Indemnitee acted in good faith and in a manner he reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan, he shall be deemed to have acted in a manner consistent with the standards required for indemnification by the Company under the Applicable Documents. 2. INSURANCE. The Company may, but need not, maintain liability insurance for so long as Indemnitee's services are covered hereunder, provided and to the extent that such insurance is available on a basis acceptable to the Company. However, the Company agrees that the provisions hereof shall remain in effect regardless of whether liability or other insurance coverage is at any time obtained or retained by the Company; except that any payments in fact made to Indemnitee under an insurance policy obtained or retained by the Company shall reduce -2- 4 the obligation of the Company to make payments hereunder by the amount of the payments made under any such insurance policy. 3. PAYMENT OF EXPENSES. At Indemnitee's request, after receipt of written notice pursuant to Section 6 hereof and an undertaking in the form of Exhibit B attached hereto by or on behalf of Indemnitee to repay such amounts so paid on Indemnitee's behalf if it shall ultimately be determined under the Applicable Document that Indemnitee is not entitled to be indemnified by the Company for such Expenses, the Company shall pay the Expenses as and when incurred by Indemnitee. That portion of Expenses which represents attorneys' fees and other costs incurred in defending any proceeding shall be paid by the Company within thirty (30) days of its receipt of such request, together with reasonable documentation (consistent, in the case of attorneys' fees, with Company practice in payment of legal fees) evidencing the amount and nature of such Expenses, subject to its also having received such a notice and undertaking. 4. ADDITIONAL RIGHTS. The indemnification provided in this Agreement shall not be exclusive of any other indemnification or right to which Indemnitee may be entitled and shall continue after Indemnitee has ceased to occupy a position as an officer, director, employee, agent or representative as described in Section 1 above with respect to Proceedings relating to or arising out of Indemnitee's acts or omissions during his service in such position. 5. NOTICE TO COMPANY. Indemnitee shall provide to the Company prompt written notice of any Proceeding brought, threatened, asserted or commenced against Indemnitee with respect to which Indemnitee may assert a right to indemnification hereunder; provided that failure to provide such notice shall not, in any way, limit Indemnitee's rights under this Agreement. 6. COOPERATION IN DEFENSE AND SETTLEMENT. Indemnitee shall not make any admission or effect any settlement without the Company's written consent unless Indemnitee shall have determined to undertake his own defense in such matter and has waived the benefits of this Agreement. The Company shall not settle any Proceeding to which Indemnitee is a party in any manner which would impose any Expense on Indemnitee without his written consent. Neither Indemnitee nor the Company will unreasonably withhold consent to any proposed settlement. Indemnitee and the Company shall cooperate to the extent reasonably possible with each other and with the Company's insurers, in attempts to defend and/or settle such Proceeding. 7. ASSUMPTION OF DEFENSE. Except as otherwise provided below, to the extent that it may wish, the Company jointly with any other indemnifying party similarly notified will be entitled to assume Indemnitee's defense in any Proceeding, with counsel mutually satisfactory to Indemnitee and the Company. After notice from the Company to Indemnitee of the Company's election so to assume such defense, the Company will not be liable to Indemnitee under this Agreement for Expenses subsequently incurred by Indemnitee in connection with the defense thereof other than reasonable costs of investigation or as otherwise provided below. Indemnitee shall have the right to employ counsel in such Proceeding, but the fees and expenses of such counsel incurred after notice from the Company of its assumption of the defense thereof shall be at Indemnitee's expense unless: -3- 5 (a) The employment of counsel by Indemnitee has been authorized by the Company; (b) Counsel employed by the Company initially is unacceptable or later becomes unacceptable to Indemnitee and such unacceptability is reasonable under then existing circumstances; (c) Indemnitee shall have reasonably concluded that there may be a conflict of interest between Indemnitee and the Company in the conduct of the defense of such Proceeding; or (d) The Company shall not have employed counsel promptly to assume the defense of such Proceeding, in each of which cases the fees and expenses of counsel shall be at the expense of the Company and subject to payment pursuant to this Agreement. The Company shall not be entitled to assume the defense of Indemnitee in any Proceeding brought by or on behalf of the Company or as to which Indemnitee shall have made either of the conclusions provided for in clause (b) or (c) above. 8. ENFORCEMENT. In the event that any dispute or controversy shall arise under this Agreement between Indemnitee and the Company with respect to whether the Indemnitee is entitled to indemnification in connection with any Proceeding or with respect to the amount of Expenses incurred, then with respect to each such dispute or controversy Indemnitee may seek to enforce the Agreement through legal action or, at Indemnitee's sole option and request, through arbitration. If arbitration is requested, such dispute or controversy shall be submitted by the parties to binding arbitration in the City of Akron, State of Ohio, before a single arbitrator agreeable to both parties; provided that indemnification in respect of any claim, issue or matter in a Proceeding brought against Indemnitee by or in the right of the Company and as to which Indemnitee shall have been adjudged to be liable for negligence or misconduct in the performance of his duty to the Company shall be submitted to arbitration only to the extent permitted under the Company's Code of Regulations and applicable law then in effect. If the parties cannot agree on a designated arbitrator within 15 days after arbitration is requested in writing by either of them, the arbitration shall proceed in the City of Akron, State of Ohio, before an arbitrator appointed by the American Arbitration Association. In either case, the Arbitration proceeding shall commence promptly under the rules then in effect of that Association and the arbitrator agreed to by the parties or appointed by that Association shall be an attorney other than an attorney who has, or is associated with a firm having associated with it an attorney which has, been retained by or performed services for the Company or Indemnitee at any time during the five years preceding the commencement of arbitration. The award shall be rendered in such form that judgment may be entered thereon in any court having jurisdiction thereof. The prevailing party shall be entitled to prompt reimbursement of any costs and expenses (including, without limitation, reasonable attorneys' fees) incurred in connection with such legal action or arbitration; provided that Indemnitee shall not be obligated to reimburse the Company unless the arbitrator or court which resolves the dispute determines that Indemnitee acted in bad faith in bringing such action or arbitration. -4- 6 9. EXCLUSIONS. Notwithstanding the scope of indemnification which may be available to Indemnities from time to time under any Applicable Document, no indemnification, reimbursement or payment shall be required of the Company hereunder with respect to: (a) Any claim or any part thereof as to which Indemnitee shall have been adjudged by a court of competent jurisdiction from which no appeal is or can be taken to have acted in willful misfeasance, or willful disregard of his duties, except to the extent that such court shall determine upon application that, despite the adjudication of liability, but in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnity for such expenses as the court shall deem Proper; (b) Any claim or any part thereof arising under Section 16(b) of the Exchange Act pursuant to which Indemnitee shall be obligated to pay any penalty, fine, settlement or judgment; (c) Any obligation of Indemnitee based upon or attributable to the Indemnitee gaining in fact any personal gain, profit or advantage to which he was not entitled; or (d) Any Proceeding initiated by Indemnitee without the consent or authorization of the Board of Directors of the Company, provided that this exclusion shall not apply with respect to any claims brought to Indemnitee to enforce his rights under this Agreement or in any Proceeding initiated by another person or entity whether or not such claims were brought by Indemnitee against a person or entity who was otherwise a party to such Proceeding. Nothing in this Section 9 shall eliminate or diminish Company's obligations to advance that portion of Indemnitee's Expenses which represent attorneys' fees and other costs incurred in defending any proceeding pursuant to Section 3 of this Agreement. 10. EXTRAORDINARY TRANSACTIONS. The Company covenants and agrees that in the event of any merger, consolidation or reorganization in which the Company is not the surviving entity, any sale of all or substantially all of the assets of the Company or any liquidation of the Company (each such event is hereinafter referred to as an "extraordinary transaction"), the Company shall: (a) Have the obligations of the Company under this Agreement expressly assumed by the survivor, purchaser or successor, as the case may be, in such extraordinary transaction; or (b) Otherwise adequately provide for the satisfaction of the Company's obligations under this Agreement, in a manner acceptable to Indemnitee. -5- 7 11. NO PERSONAL LIABILITY. Indemnitee agrees that neither the Directors nor any officer, employee, representative or agent of the Company shall be personally liable for the satisfaction of the Company's obligations under this Agreement, and Indemnitee shall look solely to the assets of the Company for satisfaction of any claims hereunder. 12. SEVERABILITY. If any provision, phrase or other portion of this Agreement should be determined by any court of competent jurisdiction to be invalid, illegal or unenforceable, in whole or in part, and such determination should become final, such provision, phrase or other portion shall be deemed to be severed or limited, but only to the extent required to render the remaining provisions and portions of the Agreement enforceable, and the Agreement as thus amended shall be enforced to give effect to the intention of the parties insofar as that is possible. 13. SUBROGATION. In the event of any payment under this Agreement, the Company shall be subrogated to the extent thereof to all rights to indemnification or reimbursement against any insurer or other entity or person vested in the Indemnitee, who shall execute all instruments and take all other actions as shall be reasonably necessary for the Company to enforce such rights. 14. GOVERNING LAW. The parties hereto agree that this Agreement shall be construed and enforced in accordance with and governed by the laws of the State of Ohio. 15. NOTICES. All notices, requests, demands and other communications hereunder shall be in writing and shall be considered to have been duly given if delivered by hand and receipted for by the party to whom the notice, request, demand or other communication shall have been directed, or mailed by Certified mail, return receipt requested, with postage prepaid; (a) If to the Company, to: Myers Industries, Inc. 1293 South Main Street Akron, Ohio 44301 Attention: President (b) If to Indemnitee, to: ______________ ______________ ______________ or to such other or further address as shall be designated from time to time by the Indemnitee or the Company to the other. -6- 8 16. TERMINATION. This Agreement may be terminated by either party upon not less than sixty (60) days' prior written notice delivered to the other party, but such termination shall not in any way diminish the obligations of Company hereunder with respect to Indemnitee's activities prior to the effective date of termination. 17. AMENDMENTS. This Agreement and the rights and duties of Indemnitee and the Company hereunder may not be amended, modified or terminated except by written instrument signed and delivered by the parties hereto. This Agreement is and shall be binding upon and shall inure to the benefits of the parties hereto and their respective heirs, executors, administrators, successors and assigns. IN WITNESS WHEREOF, the undersigned have executed this Agreement in triplicate as of the date first above written. Myers Industries, Inc. By: --------------------------------- Its: --------------------------------- Indemnitee ------------------------------------- ------------- -7- 9 EXHIBIT A FROM THE MYERS INDUSTRIES, INC. CODE OF REGULATIONS ARTICLE VI INDEMNIFICATION OF DIRECTORS, OFFICERS AND EMPLOYEES The Company shall indemnify any director or officer and any former director or officer of the Company and any such director or officer who is or has served at the request of the Company as a director, officer or trustee of another corporation, partnership, joint venture, trust or other enterprise (and his heirs, executors and administrators) against expenses, including attorney's fees, judgments, fines and amounts paid in settlement, actually and reasonably incurred by him by reason of the fact that he is or was such director, officer or trustee in connection with any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative to the full extent permitted by applicable law. The indemnification provided for herein shall not be deemed to restrict the right of the Company (i) to indemnify employees, agents and others to the extent not prohibited by such law, (ii) to purchase and maintain insurance or furnish similar protection on behalf of or for any person who is or was a director, officer, employee or agent of the Company, or any person who is or was serving at the request of the Company as a director, officer, trustee, employee or agent of another corporation, joint venture, partnership, trust or other enterprise against any liability asserted against him or incurred by him in any such capacity or arising out of his status as such, and (iii) to enter into agreements with persons of the class identified in clause (ii) above indemnifying them against any and all liabilities (or such lesser indemnification as may be provided in such agreements) asserted against or incurred by them in such capacities. [Effective on or about April 26, 1989] 10 EXHIBIT B FORM OF UNDERTAKING THIS UNDERTAKING has been entered into by ______________ (hereinafter "Indemnitee") pursuant to an Indemnification Agreement dated __________, 19___ (the "Indemnification Agreement"), between Myers Industries, Inc. (hereinafter "Company"), an Ohio corporation, and Indemnitee. R E C I T A L S: A. Pursuant to the Indemnification Agreement, Company agreed to pay Expenses (within the meaning of the Indemnification Agreement) as and when incurred by Indemnitee in connection with any claim against Indemnitee which is the subject of any threatened, pending or completed action, suit or proceeding, whether civil, criminal or investigative, to which Indemnitee was, is or is threatened to be made a party by reason of facts which include Indemnitee's being or having been a director, officer or representative (within the meaning of the Indemnification Agreement) of Company; B. Such claim has arisen against Indemnitee and Indemnitee has notified Company thereof in accordance with the terms of Section 5 of the Indemnification Agreement (hereinafter the "Proceeding"); C. Indemnitee believes that Indemnitee should prevail in this Proceeding and it is in the interest of both Indemnitee and Company to defend against the claims against Indemnitee thereunder; NOW, THEREFORE, Indemnitee hereby agrees that in consideration of Company's advance payment of Indemnitee's Expenses incurred prior to a final disposition of the Proceeding, Indemnitee hereby undertakes to reimburse Company for any and all expenses paid by Company on behalf of Indemnitee prior to a final disposition of the Proceeding in the event that Indemnitee is determined under the Applicable Document (within the meaning of the Indemnification Agreement) not to be entitled to indemnification for such Expenses pursuant to the Indemnification Agreement and applicable law, provided that if Indemnitee is entitled under the Applicable Document to indemnification for some or a portion of such Expenses, Indemnitee's obligation to reimburse Company shall only be for those Expenses for which Indemnitee is determined not to be entitled to indemnification. Such reimbursement or arrangements for reimbursement by Indemnitee shall be consummated within ninety (90) days after a determination that Indemnitee is not entitled to indemnification and reimbursement pursuant to the Indemnification Agreement and applicable law. IN WITNESS WHEREOF, the undersigned has set his hand this ___ day of ______, 19__. Indemnitee ---------------------------------- ------------ EX-10.D 5 MYERS INDUSTRIES 10-K405 EXHIBIT 10(D) 1 EXHIBIT 10(d) MYERS INDUSTRIES, INC. 1992 STOCK OPTION PLAN 2 MYERS INDUSTRIES, INC. 1992 STOCK OPTION PLAN 1. ESTABLISHMENT, PURPOSE, AND EFFECTIVE DATE OF PLAN. 1.1 Establishment. Myers Industries, Inc., an Ohio corporation and its subsidiaries ("Company") hereby establishes the "1992 Stock Option Plan") ("Plan") for key employees of the Company, and for Directors of the Company who are not employees of the Company. The Plan permits the grant of "Employee Stock Options" to certain key employees and the grant of "Director Stock Options" to Eligible Directors of the Company based upon a fixed formula. 1.2 Purpose. The purpose of the Plan is to advance the interests of the Company by encouraging and providing for the acquisition of an equity interest in the Company by key employees and Directors of the Company and by enabling the Company to attract and retain the services of such key employees and Directors upon whose judgment, interest, and special effort the successful conduct of its operations is largely dependent. 1.3 Effective Date. The Plan shall become effective as of January 14, 1992, the date of its adoption by the Board of Directors of the Company, subject to the subsequent approval by the necessary number of shareholders of the Company. No Option shall be granted hereunder until the shareholders of the Company have approved the Plan. 2. DEFINITIONS. 2.1 Definitions. Whenever used herein, the following terms shall have their meanings set forth below: "Administrator" means the Vice President-Finance of the Company who shall administer the Director Stock Option program. "Award" means any Option. "Board" means the Board of Directors of the Company. "Code" means the Internal Revenue Code of 1986, as amended. "Committee" means the Committee of the Company's Board of Directors which shall consist of three or more Directors appointed to the Board to administer the Employee Stock Option program. These Directors shall be "disinterested persons" within the meaning of Rule 16b-3 of the Securities Exchange Act of 1934 ("Exchange Act"). "Common Stock" means the common stock of the Company, without par value. "Company" means Myers Industries, Inc. and its subsidiaries. 3 "Disability" means disability as determined by the Committee, in the case of the Employee Stock Option program, and the Administrator in the case of the Director Stock Option program. "Director Stock Option" means an Option granted to an Eligible Director. Each Director Stock Option shall be a nonqualified stock option the grant of which is not intended to fall under the provisions of Section 422A of the Code. "Eligible Director" means any statutory director of the Company who is not an employee of the Company. "Employee Stock Option" means any Option granted to an eligible employee as either a qualified stock option or a non-qualified stock option. "Fair Market Value" means the closing price of the Common Stock as reported on the principal United States securities exchange registered under the Exchange Act on which such Common Stock is listed, which is the American Stock Exchange, Inc., or if such Common Stock is not in the future listed on any such exchange, the highest closing bid quotation with respect to a share of such Common Stock on the National Association of Securities Dealers, Inc. Automated Quotations System or any substantially equivalent system then in use on a particular date. In the event that there are no Common Stock transactions on such date, the Fair Market Value shall be determined as of the immediately preceding date on which there were Common Stock transactions. "Option" means the right to purchase Common Stock at a stated price for a specified period of time. For purposes of the Plan an Employee Stock Option may be either (i) an incentive stock option within the meaning of Section 422A of the Code or (ii) a nonqualified stock option whose grant is intended not to fall under the provisions of Section 422A. All Director Stock Options will be nonqualified stock options whose grant is intended not to fall under the provisions of Section 422A. "Option Agreement" means an agreement entered into between the Company and an employee pursuant to the Employee Stock Option program in the form prescribed by the Committee, or between the Company and an Eligible Director pursuant to the Director Stock Option program in the form prescribed by the Administrator. "Option Price" means the price at which each share of Common Stock subject to an Option may be purchased, determined in accordance with Section 7.4. "Participant" means any individual being a key employee designated by the Committee to participate in the Plan pursuant to Section 3.1 herein. "Retirement" means termination of employment upon the normal retirement age se by the Board of Directors. -2- 4 "Return on Common Equity" means the result obtained by dividing "Net Income" by the "Common Shareholders Equity," as such terms are defined by the Company's accountant. 2.2 Gender and Number. Except when otherwise indicated by the context, words in the masculine gender when used in the Plan shall include the feminine gender, the singular shall include the plural, and the plural shall include the singular. 3. ELIGIBILITY AND PARTICIPATION. 3.1 Employee Stock Option. Participants in the Plan shall be selected by the Committee from among those employees of the Company who in the opinion of the Committee are in a position to contribute materially to the Company's continued growth, development, and long-term financial success. Persons serving on the Committee shall not be eligible to be a Participant. 3.2 Director Stock Options. Eligible Directors are entitled to participate in the Plan solely with respect to the grant of Director Stock Options. The selection of Eligible Directors is not subject to the discretion of the Committee or Administrator. Persons serving on the Committee who are Eligible Directors may receive grants of Director Stock Options. 4. ADMINISTRATION. 4.1 The Committee. The Committee shall be responsible for the administration of the Plan as it relates solely to Employee Stock Options. The Committee, by majority action thereof, is authorized to interpret the Plan, to prescribe, amend, and rescind rules and regulations relating to the Plan, to provide for conditions and assurances deemed necessary or advisable to protect the interests of the Company, and to make all other determinations necessary or advisable for the administration of the Plan, but only to the extent not contrary to the explicit provisions of the Plan. Determinations, interpretations, or other actions made or taken by the Committee pursuant to the provisions of the Plan relating to Employee Stock Options shall be final and binding and conclusive for all purposes and upon all persons whomsoever. 4.2 The Administrator. The Administrator, being the Vice President-Finance of the Company, shall be responsible for the administration of the Plan as it relates solely to Director Stock Options. The Administrator is authorized to interpret the Plan, to prescribe, amend, and rescind rules and regulations relating to the Plan, to provide for conditions and assurances deemed necessary or advisable to protect the interests of the Company, and to make all other determinations necessary or advisable for the administration of the Plan, but only to the extent not contrary to the explicit provisions of the Plan. Determinations, interpretations, or other actions made or taken by the Administrator pursuant to the provisions of the Plan relating to Director Stock Options shall be final and binding and conclusive for all purposes and upon all persons whomsoever. -3- 5 5. STOCK SUBJECT TO PLAN. 5.1 Number. The total number of shares of Common Stock subject to issuance under the Plan shall be Two Hundred Thousand (200,000) shares of capital stock of the Company; One Hundred Seventy Thousand (170,000) issuable as Employee Stock Options and Thirty Thousand (30,000) issuable as Director Stock Options. The shares to be delivered under the Plan may consist, in whole or in part, of authorized but unissued Common Stock or issued Common Stock reacquired and held as treasury stock not reserved for any other purpose. 5.2 Unused Stock. In the event any shares of Common Stock that are subject to an Option which, for any reason, expires or is terminated unexercised or are reacquired by the Company, such shares again shall become available for issuance under the Plan. 5.3 Adjustment in Capitalization. In the event that subsequent to the date of adoption of the Plan by the Board, the shares of Common Stock should as a result of a stock split, stock dividend, combination or exchange of shares, exchange for other securities, reclassification, reorganization, redesignation, merger, consolidation, recapitalization or other such change, be increased or decreased or changed into or exchanged for a different number or kind of shares of Common Stock or other securities of the Company or of another corporation, then (a) there shall automatically be substituted for each share of Common Stock subject to an unexercised Option (in whole or in part) granted under the Plan and each share of Common Stock available for additional grants of Options under the Plan the number and kind of shares of Common Stock or other securities into which each outstanding share of Common Stock shall be changed or for which each such share shall be exchanged, (b) the Option Price shall be increased or decreased proportionately so that the aggregate purchase price for the securities subject to the Option shall remain the same as immediately prior to such event, and (c) the Board shall make such other adjustments to the securities subject to Options and the provisions of the Plan and Option Agreements as may be appropriate and equitable. Any such adjustment may provide for the elimination of fractional shares. 6. DURATION OF PLAN. The Plan shall remain in effect, subject to the Board's right to earlier terminate the Plan pursuant to Section 11 hereof, until all Common Stock subject to it shall have been purchased or acquired pursuant to the provisions hereof. Notwithstanding the foregoing, no Option may be granted under the Plan on or after the tenth (10th) anniversary of the Plan's effective date. 7. STOCK OPTIONS. 7.1 Grant of Employee Stock Options. Subject to the provisions of Sections 5 and 7, Employee Stock Options may be granted to Participants at any time and from time to time as shall be determined by the Committee. The Committee shall have complete discretion in determining the number of Options granted to each Participant. The Committee also shall determine whether an Option is to be an incentive stock option within the meaning of Code -4- 6 Section 422A ("ISO"), or a nonqualified stock option whose grant is intended not to fall within the provisions of Section 422A ("NQSO"). However, in no event shall the aggregate Fair Market Value (determined at the date of grant) of the stock of which incentive stock options are first exercisable in a particular calendar year exceed $100,000, or such other limit as may be required by the Code. Nothing in this Section 7 shall be deemed to prevent the grant of NQSOs in excess of the maximum established by Section 422A of the Code. 7.2 Grant of Director Stock Options. Subject to the provisions of Sections 5 and 7, Director Stock Options shall be granted to Eligible Directors as provided in this Section 7.2 and neither the Administrator nor the Committee shall have any discretion with respect to any matters set forth in this Section 7.2. Commencing immediately after the adjournment of the Company's Annual Meeting of Shareholders ("Annual Meeting") in 1992 and immediately after the adjournment of the Annual Meeting each year thereafter, any Eligible Director who was an Eligible Director immediately preceding such Annual Meeting and who has been elected as a director at such Annual Meeting shall automatically be granted a Director Stock Option for Five Hundred (500) shares of Common Stock if, but only if, the Return on Common Equity of the Company as set forth in the Company's annual report to shareholders for the immediately preceding fiscal year is equal to or greater than ten percent (10%). 7.3 Option Agreement. Each Option shall be evidenced by an Option Agreement that shall specify the type of Option granted, the Option Price, the duration of the Option, the number of shares of Common Stock to which the Option pertains, and such other provisions as the Committee shall determine for the Employee Stock Options, and as the Administrator shall determine for the Director Stock Options. 7.4 Option Price. Employee Stock Options granted as ISOs, and all Director Stock Options, shall have an Option Price that is equal to the Fair Market Value of the Common Stock on the date the Option is granted. An ISO, however, shall only be granted to a person who owns, directly or indirectly, Common Stock possessing more than ten percent (10%) of the total combined voting power of all classes of Common Stock of the Company, if the price of any such Option is at least one hundred and ten percent (110%) of the Fair Market Value of the Common Stock subject to the Option. NQSOs granted as Employee Stock Options must have an option price which is not less than the amount allowed by applicable law, which option price may be less than the Fair Market Value on the day of grant. 7.5 Duration of Options. Each Employee Stock Option shall expire at such time as the Committee shall determine at the time the option is granted, provided, however, that all Employee Stock Options, whether as an ISO or NQSO, must be exercisable no later than ten (10) years and one day from the date of its grant. An Employee Stock Option granted to a person who owns, directly or indirectly, Common Stock possessing more than ten percent (10%) -5- 7 of the total combined voting power of all classes of Common Stock of the Company must be exercisable no later than five (5) years from the date it is granted. Director Stock Options must be exercisable no later than ten (10) years and one day from the date of its grant. 7.6 Exercise of Options. All Employee Stock Options granted under the Plan shall be exercisable at such times and be subject to such restrictions and conditions as the Committee shall in each instance approve, which need not be the same for all Participants. Director Stock Options granted under the Plan shall be exercisable one year after the date of its grant. No Option may be exercised until six months after the date of its grant. 7.7 Payment. The Option Price upon exercise of any Option shall be payable to the Company in full either (i) in cash or its equivalent, or (ii) by tendering shares of previously acquired Common Stock having a Fair Market Value at the time of exercise equal to the total Option Price, or (iii) by a combination of (i) and (ii). The proceeds from such a payment shall be added to the general funds of the Company and shall be used for general corporate purposes. As soon as practicable after receipt of full payment (including the necessary tax withholding), the Company shall deliver to the Participant or the Eligible Director, as the case may be, Common Stock certificates in an appropriate amount based upon the number of Options exercised, issued in the name of the Participant or the Eligible Director, as the case may be. 7.8 Restrictions on Stock Transferability. The Committee shall impose such restrictions on any shares of Common Stock acquired pursuant to the exercise of an Option under the Plan as it may deem advisable, including, without limitation, restrictions under applicable Federal securities law, under the requirements of any stock exchange upon which such shares of Common Stock are then listed under any blue sky or state securities laws applicable to such shares. 7.9 Termination of Employment for Specific Reasons. In the event the employment of a Participant is terminated for resignation, retirement, Disability or death, any outstanding Option granted pursuant to the Plan and any rights thereunder shall be exercisable by the Participant (or in the case of a deceased Participant by his legal representative) only to the extent of the accrued right to exercise such Option at the date of such termination. An employee will not be deemed terminated for leaves of absence related to illness or military leave. The Committee may, in its sole direction, permit the exercise of all or any portion of the Option not otherwise exercisable and may provide that all or some portion of the Option shall not terminate upon or by virtue of such employment termination. To the extent that any such Option is exercisable at termination or, as the result of Committee approval, becomes exercisable at termination, the Option will remain exercisable for the earlier of the expiration date of the Option, or the following time periods beginning after the event which gives rise to the basis for termination: (a) resignation or retirement, three (3) months; (b) Disability, twelve (12) months; and (c) death, six (6) months. -6- 8 If at any time the Committee determines that a Participant has committed an act adverse to the interests of the Company, including but not limited to acts in competition with the Company or otherwise adverse to or not in the best interests of the Company, the Committee may rescind the right of the Participant to exercise all or part of any Options then held, whether vested or unvested, said Options thereupon becoming null, void and of no effect. 7.10 Termination of Employment for Other Than Section 7.9 Reasons. If the employment of the Participant shall terminate for any reason other than one of those specified in Section 7.9 of the Plan, the rights under any then outstanding Option granted pursuant to the Plan which, pursuant to the terms of the Option Agreement between the Participant and the Company, is exercisable as of the date of such termination, shall terminate upon the expiration date of the Option or three (3) months after such date of termination of employment, whichever first occurs. In its sole discretion, the Committee may extend the three (3) months up to twelve (12) months, but in no event beyond the expiration date of the Option. 7.11 Termination of Eligible Director Shares. In the event that an Eligible Director ceases to be an Eligible Director for any reason, the rights under any outstanding Director Stock Options granted shall become immediately vested and exercisable pursuant to the terms of the original grant. If an Eligible Director ceases to be such by reason of death, any period shall be extended to the sooner of twelve months or the expiration date of the Director Stock Option. 7.12 Nontransferability of Options. No Option granted under the Plan may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, otherwise than by will or by the laws of descent and distribution. All Options granted to a Participant or an Eligible Director under the Plan shall be exercisable during his lifetime only by such Participant or Eligible Director. 8. BENEFICIARY DESIGNATION. Each Participant or Eligible Director under the Plan may, from time to time, name any beneficiary or beneficiaries (who may be named contingently or successively) to whom any benefit under the Plan is to be paid in case of his death before he receives any or all of such benefit. Each designation will revoke all prior designations by the same Participant or Eligible Director, shall be in a form prescribed by the Committee or Administrator (as the case requires), and will be effective only when filed by the Participant or Eligible Director in writing with the Committee or Administrator (as the case requires) during his lifetime. In the absence of any such designation, benefits remaining unpaid at the Participant's or Eligible Director's death shall be paid to his estate. 9. RIGHTS OF EMPLOYEES. 9.1 Employment. Nothing in the Plan shall interfere with or limit in any way the right of the Company to terminate any Participant's employment at any time, nor confer upon any Participant any right to continue in the employ of the Company. -7- 9 9.2 Participation. No employee shall have a right to be selected as a Participant, or, having been so selected, to be selected again as a Participant. 10. CHANGE IN CONTROL. 10.1 General. In the event that (a) the Company is a party to a merger or consolidation agreement, (b) the Company is a party to an agreement to sell substantially all of its assets, or (c) there is change in control of the Company as defined in Section 10.3 below, the Committee in the case of Employee Options, may, in their sole discretion, provide that all outstanding Options shall become immediately exercisable. All Director Stock Options shall become immediately exercisable. 10.2 Limitation on Payments. If the receipt of any payment under this Section by any Participant shall, in the opinion of independent tax counsel selected by the Company, result in the payment by such Participant of any excise tax provided for in Section 280G and Section 4999 of the Code, or any sections of similar import, then the amount of such payment shall be reduced to the extent required, in the opinion of independent tax counsel, to prevent the imposition of such excise tax. 10.3 Definitions. For purposes of the Plan, a "change in control" shall mean any of the following events: (a) The acquisition of "beneficial ownership," as defined in Rule 13d-3 promulgated under the Exchange Act of twenty percent (20%) or more of the total voting capital Common Stock of the Company then issued and outstanding, by any person, or "group," as defined in Section 13(d)(3) of the Exchange Act; or (b) Any person or group makes a filing under Section 13(d) or 14(d) of the Exchange Act; or (c) Individuals who were members of the Board of the Company immediately prior to a meeting of the shareholders of the Company involving a contest for the election of Directors do not constitute a majority of the Board immediately following such election, unless the election of such new Directors was recommended to the shareholders by management of the Company. The Board has final authority to determine the exact date on which a change in control has been deemed to have occurred under (a) and (b) above. 11. AMENDMENT, MODIFICATION AND TERMINATION OF PLAN. The Board may at any time terminate and, from time to time, may amend or modify the Plan, provided, however, that no such action of the Board, without approval of the shareholders, may: -8- 10 (a) Increase the total amount of Common Stock which may be issued under the Plan, except as provided in Subsections 5.1 and 5.3 of the Plan. (b) Change the provisions of the Plan regarding the Option Price except as permitted by Subsection 5.3. (c) Materially increase the cost of the Plan or materially increase the benefits to Participants. (d) Extend the period during which Options may be granted. (e) Extend the maximum period after the date of grant during which Options may be exercised. No amendment, modification, or termination of the Plan shall in any manner adversely affect any Options theretofore granted under the Plan, without the consent of the Participant or the Eligible Director, as the case may be. 12. TAX WITHHOLDING. (a) The Company shall have the right to withhold from any payments made under the Plan or to collect as a condition of payment, any taxes required by law to be withheld. At any time when a Participant or an Eligible Director, as the case may be, is required to pay to the Company an amount required to be withheld under applicable income tax laws in connection with a distribution of common stock or upon exercise of an Option, the Participant or an Eligible Director, as the case may be, may satisfy this obligation in whole or in part by electing ("Election") to have the Company withhold from the distribution, shares of common stock having a value equal to the amount required to be withheld. The value of the shares to be withheld shall be based on the Fair Market Value of the common stock on the date that the amount of tax to be withheld shall be determined ("Tax Date"). (b) Each Election must be made prior to the Tax Date. The Committee may disapprove of any Election, may suspend or terminate the right to make Elections, or may provide with respect to any grant that the right to make elections shall not apply to such Grant. An Election is irrevocable. (c) If a Participant is an officer of the Company within the meaning of Section 16 of the Exchange Act or if the person making the Election is an Eligible Director, than an Election is subject to the following additional restrictions: (1) The Election must be made six (6) months prior to the Tax Date. (2) No Election shall be effective for a Tax Date which occurs within six (6) months of the grant of the award, except that this limitation shall not apply in the event -9- 11 Death or Disability of the Participant or the Eligible Director, as the case may be, occurs prior to the expiration of the six-month period. 13. INDEMNIFICATION. The Administrator and each person who is or shall have been the Administrator, and each person who is or shall have been a member of the Committee, shall be indemnified and held harmless by the Company against and from any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by him in connection with or resulting from any claim, action, suit, or proceeding to which he may be a party or in which he may be involved by reason of any action taken or failure to act under the Plan and against and from any and all amounts paid by him in settlement thereof, with the Company's approval, or paid by him in satisfaction of any judgment in any such action, suit, or proceeding against him, provided he shall give the Company an opportunity, at its own expense, to handle and defend the same before he undertakes to handle and defend it on his own behalf. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled under the Company's Articles of Incorporation or Code of Regulations, as a matter of law, or otherwise, or any power that the Company may have to indemnify them or hold them harmless. 14. REQUIREMENTS OF LAW. 14.1 Requirements of Law. The granting of Options and the issuance of shares of Common Stock upon the exercise of an Option shall be subject to all applicable laws, rules, and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required. 14.2 Governing Law. The Plan, and all agreements hereunder, shall be construed in accordance with and be governed by the laws of the State of Ohio. -10- EX-10.E 6 MYERS INDUSTRIES 10-K405 EXHIBIT 10(E) 1 EXHIBIT 10(e) MYERS INDUSTRIES, INC. DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN 2 MYERS INDUSTRIES, INC. AMENDED AND RESTATED DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN ADOPTED JULY 22, 1992; AMENDED APRIL 28, 1993 AND EFFECTIVE MAY 1, 1993 A. GENERAL PROVISIONS OF THE PLAN 1. PURPOSE OF THE PLAN. The Myers Industries, Inc. Amended and Restated Dividend Reinvestment and Stock Purchase Plan (the "PLAN") has been adopted by Myers Industries, Inc. ("MYERS" or the "COMPANY") to provide the holders of record of shares of Myers common stock, no par value ("MYERS STOCK") with a simple, convenient and economical method of investing cash dividends in additional shares of Myers Stock and also allowing for the purchase of additional shares of Myers Stock by making optional cash payments, both without payment of any brokerage commissions or service charges. The shares of Myers Stock purchased under the Plan will be purchased from Myers. The Company will receive the proceeds from such sales and the proceeds will be used for general corporate purposes. 2. ADMINISTRATION OF THE PLAN. Myers has appointed First Chicago Trust Company, New York, New York ("FIRST CHICAGO"), as ("ADMINISTRATOR"), and the Administrator has agreed to administer the Plan by keeping the necessary records, processing the necessary information, sending the necessary statements of account to those shareholders who have enrolled and are participating in the Plan ("PARTICIPANTS") and by performing such other necessary duties relating to the Plan. Myers has reserved the right, subject to the terms of the agreement between Myers and the Administrator, and may from time to time appoint another entity as the agent to perform, or assist Myers in the performance of, the administrative duties for the Plan. The shares of Myers Stock purchased from Myers under the Plan will be held for the account of each Participant by First Chicago as the custodian designated by Myers (the "CUSTODIAN"). All shares of Myers Stock held under the Plan shall be registered in the name of the Custodian's nominee, as the agent of each of the Participants in the Plan. Myers has reserved the right, subject to the terms of the agreement between Myers and the Administrator, and may from time to time appoint another entity as the agent to perform, or assist Myers in the performance of, the custodial duties for the Plan. Myers reserves the right, acting in good faith, to interpret and regulate the Plan as deemed desirable or necessary in connection with the Plan's operation, and to adopt such rules and regulations as it deems necessary or appropriate to facilitate the administration of the Plan, which rules and regulations may be adopted without notice to the Participants and shall be binding upon each Participant. 3. NOTICES. Any notice, statement or certificate which by any provision of the Plan is required or permitted to be given by Myers, the Administrator or the Custodian, shall be in writing and shall be deemed to have been sufficiently given for all purposes by being deposited, postage prepaid, in the United States mail, addressed to the Participant at his address as it shall last appear on the Administrator's records or, if Myers is not the Administrator at that time and is giving such notice, on Myers' records. Any notice, instruction, request or election which by any provision of the Plan is required or permitted to be given or made by a Participant to the Administrator or the Custodian shall be deemed to have been sufficiently given or made for all purposes by being deposited, postage prepaid, in the United States mail addressed to the Administrator at the address specified in the then most recent statement, notice or other communication from the Administrator. 3 4. CONTROLLING TERMS. The terms and conditions of the Plan, the Enrollment-Authorization Form (defined below) and the operation of the Plan shall be governed by and construed in accordance with the laws of the State of Ohio. Myers reserves the right, acting in good faith, to interpret and regulate the Plan as deemed desirable or necessary in connection with the Plan's operation. 5. AMENDMENT AND TERMINATION OF THE PLAN. Myers reserves the right to amend, modify, suspend or terminate the Plan, or to terminate any Participant's participation in the Plan, at any time after written notice of any such action is mailed to the Participant or all Participants, as the case may be, at the address or addresses appearing on the records of the Administrator (or Myers, if Myers is the Administrator at that time). Any such action taken by Myers shall not have any retroactive effect which would prejudice the interests of Participants. 6. RESPONSIBILITY OF MYERS, THE ADMINISTRATOR AND THE CUSTODIAN. Neither Myers, the Administrator, nor the Custodian shall be liable for any action taken, suffered or omitted by them or any one or more of them, in good faith, including, without limitation: any claims of liability arising out of the failure to terminate a Participant's account upon the Participant's death, adjudication of incompetency or other event of termination; the prices and times at which shares of Myers Stock are purchased for the Participant's account or sold at the request of the Participant upon his termination of Participation in the Plan; fluctuations in the market value of the Myers Stock; or any act or failure to act due to the requirement of any governmental authority. B. PROVISIONS RELATING TO PARTICIPANTS 1. ELIGIBLE SHAREHOLDERS. Any holder of record of Myers Stock ("SHAREHOLDER") is eligible to participate in the Plan, except Shareholders who reside in a jurisdiction outside the United States in which it is unlawful for Myers to permit participation in the Plan. 2. SHAREHOLDER ENROLLMENT IN THE PLAN. An eligible Shareholder may enroll as a Participant in the Plan by obtaining, completing, signing and submitting to the Administrator, an Enrollment-Authorization Form (the "ENROLLMENT FORM"). The Administrator and the Company reserve the right to reject any Enrollment Form from a Participant who has terminated participation or been terminated from participating in the Plan. 3. PARTICIPATION OPTIONS FOR SHAREHOLDERS. Each eligible Shareholder who desires to participate in the Plan may elect any one of the following three participation options: (a) FULL DIVIDEND REINVESTMENT. The Administrator will invest, in accordance with the provisions of the Plan, all of the Participant's cash dividends and other amounts as specified in Section B.16 below, in respect of all (i) shares of Myers Stock then or subsequently registered in the Participant's name, and (ii) all shares of Myers Stock held in such Participant's account under the Plan. The Participant will also be entitled to make Optional Cash Payments (as defined below) for the purchase of additional shares of Myers Stock in accordance with the provisions of the Plan. (b) PARTIAL DIVIDEND REINVESTMENT. The Administrator will invest, in accordance with the provisions of the Plan, the Participant's cash dividends and other amounts as specified in Section B.16 below, only in respect of (i) the number of shares of Myers Stock registered in such Participant's name designated in the appropriate space on the Enrollment Form, and (ii) all shares of Myers Stock held in such Participant's account under the Plan. The sale of shares of Myers Stock by the Participant will not affect the number of shares participating in the Plan; provided that, in the event the number of shares of Myers Stock held of record by a Participant is reduced to fewer than the number of shares of Myers Stock designated as participating in the Plan on the Enrollment Form, such Participant's dividend participation in the Plan shall be automatically reduced to the number of shares of Myers Stock such Participant holds of record. At such times as additional shares of Myers -2- 4 Stock may be acquired by such Participant, such additional shares will be deemed to participate in the Plan until the number of shares equals the number of shares designated as participating in the Plan on the then current Enrollment Form. The Participant will also be entitled to make Optional Cash Payments for the purchase of additional shares of Myers Stock in accordance with the provisions of the Plan. (c) OPTIONAL CASH PURCHASES ONLY. The Administrator will invest Optional Cash Payments made by the Participant in shares of Myers Stock in accordance with the provisions of the Plan. The Participant will continue to receive all cash dividends and other distributions in respect of the shares of Myers Stock such Participant holds of record. Cash dividends on all shares of Myers Stock held in such Participant's account under the Plan will be invested by the Administrator in accordance with the Plan. A participant may change his participation option at any time by submitting to the Administrator a new Enrollment Form indicating the participation option elected for future participation in the Plan. 4. OPTIONAL CASH PAYMENTS. A Participant may from time to time send to the Administrator a check or money order payable in United States Dollars to "First Chicago-Myers" in an amount not less than $50 nor more than $2,500, accompanied by a written instruction to the Administrator on the form supplied to Participants by the Administrator to apply such cash payment to the purchase of Myers Stock for such Participant's account ("OPTIONAL CASH PAYMENT"). No Participant shall be permitted to make Optional Cash Payments in excess of $2,500 during any calendar quarter. Optional Cash Payments must be received by the Administrator on or before the applicable Investment Date (as defined below). No interest will be paid on Optional Cash Payments. A Participant may obtain the return of any Optional Cash Payment by a written notice requesting such return, provided the request is received by the Administrator at least two business days prior to the Investment Date of such Optional Cash Payment. The Optional Cash Payment will be promptly returned by mail to the address of the Participant shown on the Administrator's records. 5. INVESTMENT OF DIVIDENDS AND OPTIONAL CASH PAYMENTS. As agent for the Participants in the Plan, the Administrator will apply (i) all cash dividends payable on shares of Myers Stock registered in the names of the Participants in the Plan which have been designated, in the manner provided in Section B.3 above by each Participant as shares participating in the Plan ("ENROLLED SHARES"); (ii) all cash dividends payable on shares of Myers Stock and Fractional Share Equivalents (as defined below) acquired under the Plan and held by the Custodian for the account of Participants in the Plan; (iii) net proceeds from the sale of rights or other securities sold in accordance with Section B.17 below; and (iv) any Optional Cash Payments delivered to the Administrator in accordance with Section B.4; to the purchase of shares of Myers Stock and purchase of fractional share equivalents computed to three decimal places ("FRACTIONAL SHARE EQUIVALENTS") for the accounts of the Participants in the Plan. 6. INVESTMENT DATE. Dividends on Enrolled Shares and on shares of Myers Stock held in the Plan for the accounts of Participants will be invested as of the dividend payment date ("INVESTMENT DATE"). Optional Cash Payments will also be invested as of the Investment Date. 7. PURCHASE OF SHARES: PRICE. The shares of Myers Stock will be purchased from Myers. Such shares may be original issue or treasury shares. The per share purchase price for the shares of Myers Stock purchased with reinvested cash dividends (including shares held in the Plan for the accounts of Participants) and Optional Cash Payments, will be 100% of the closing price of shares of Myers Stock reported (in The Wall Street Journal or other nationally recognized daily newspaper) as American Stock Exchange Composite Transactions on the relevant Investment Date, or if such relevant Investment Date is not a trading day, on the trading day immediately preceding such relevant Investment Date. Any costs, including commissions, will be paid by Myers and will not be deducted from the amounts received from the Participants. -3- 5 If for any reason shares of Myers Stock are not traded on the American Stock Exchange on and for five (5) consecutive trading days prior to, or the American Stock Exchange shall remain closed on and for five (5) consecutive regular trading days prior to, any Investment Date, all cash, whether dividends or Optional Cash Payments, held for the purchase of shares of Myers Stock on such Investment Date will be sent to the Participants. In the event Myers or the Administrator shall determine that The Wall Street Journal's report contains reporting errors, the Administrator may obtain market price reports from such other sources as the Administrator shall deem appropriate. 8. RECORDS OF ACCOUNTS. The Administrator will maintain or cause to be maintained an account for each Participant in the Plan. On each Investment Date the Administrator will credit to each Participant's account the number of full shares of Myers Stock and any Fractional Share Equivalents purchased on such Investment Date with the Participant's dividends and Optional Cash Payments, if any, at the per share price paid on that Investment Date. 9. REPORTS TO PARTICIPANTS. As soon as practicable after the end of each calendar quarter, the Administrator will mail to each Participant a statement setting forth in respect of such calendar quarter ("STATEMENT PERIOD"): the dividend otherwise payable to the Participant and the Optional Cash Payments received from the Participant; Dividend Securities (as defined in Section B.17) issued and the proceeds from the sale thereof; taxes withheld, if any; the net amount invested; the number of shares of Myers Stock purchased; the per share purchase price; the total number of full shares of Myers Stock and Fractional Share Equivalent (computed to three decimal places) accumulated under the Plan by the Participant as of the end of the Statement Period; and such other information as may be deemed necessary or appropriate. At the end of each calendar year, income tax reporting information will also be supplied to each Participant. Each Participant will also receive copies of Myers' Annual and Quarterly Reports to Shareholders, Proxy Statements and other communications sent to Shareholders. 10. CUSTODY OF SHARES. All shares purchased under the Plan will be delivered to the Custodian under the Plan and held of record by the Custodian, or its nominee, as the agent of the Participants. Pursuant to instructions from the Administrator, the Custodian will deliver full shares to the Participant designated by the Administrator or will sell full shares and pay over the net proceeds to the Participant designated by the Administrator. Such instructions will be issued by the Administrator only in accordance with (i) the written instructions of a Participant terminating his participation in the Plan, (ii) the written instructions of a Participant withdrawing all or a portion of his full shares from the Plan, (iii) termination of the Participant's account by the Administrator, or (iv) Myers' notice of termination of the Plan. The Custodian will also deliver all shares held by it or its nominee under the Plan to another party upon notice to it that Myers has designated such other party as the Custodian under the Plan. Shares of Myers Stock held by the Custodian for the account of a Participant in the Plan may not be pledged, hypothecated or assigned by the Participant. A Participant may deposit certificates for shares of Myers Stock held by him outside of the Plan with the Custodian for safekeeping. Any certificates to be deposited must be properly endorsed and be accompanied by a writing indicating that the shares of Myers Stock are to be added to the Participant's account. 11. ISSUANCE OF CERTIFICATES. A Participant may at any time obtain without charge a certificate for all or part of the full shares of Myers Stock credited to his account by making a written request therefor to the Administrator. Certificates for shares of Myers Stock, when issued, will be registered in the name(s) in which the Participant's account under the Plan is maintained. The Participant shall be responsible for any transfer taxes or other expenses incurred in complying with any such request. In no event will certificates for Fractional Share Equivalents be issued. -4- 6 12. SALE OF SHARES. A Participant may at any time request the sale of all or a part of the full shares of Common Stock credited to his Plan account. Shares to be sold will be forwarded by the Administrator, on behalf of the Participant, to a brokerage firm which will effect such sale for the Participant and will remit the proceeds, less brokerage commissions, a nominal service charge, any transfer taxes and any other costs of sale ("COSTS OF SALE"). Sale requests may be accumulated by the Administrator. Shares that are to be sold may be aggregated with those of other Participants, in which case the proceeds to each Participant will be based on the weighted average of the sale prices of shares sold under the Plan on that date. 13. COSTS OF THE PLAN. Myers will bear all costs and expenses associated with the administration of the Plan in accordance with these terms and conditions, except in the event of the sale by a Participant whereby a nominal service charge ("SERVICE CHARGE") will be charged. In the event the Participant elects to have the Administrator or the Custodian, acting as his agent, sell his shares of Myers Stock held in the Plan under Section B.12 or upon his withdrawal from the Plan in accordance with Section B.14, the Participant will be charged with any brokerage commissions, the Service Charge, any applicable taxes and other charges arising from the sale of shares of Myers Stock. Such costs will be charged to the Participant and deducted from the proceeds of the sale of shares of Myers Stock so requested. 14. TERMINATION OF PARTICIPATION. A Participant may terminate his or her participation in the Plan at any time. Termination of participation in the Plan will stop all investment of the Participant's dividends if the notice of termination is received by the Administrator not later than the record date prior to the dividend payment date. Any optional cash payments which had been sent to the Administrator prior to the request to terminate will also be invested unless return of the amount is expressly requested and the request for termination and such return request is received at least two business days prior to the dividend payment date. If the request to terminate is received by the Administrator on or after the record date for a dividend payment, such request to terminate may not become effective until any dividend paid on the dividend payment date has been reinvested and the shares of Common Stock purchased are credited to the Participant's account under the Plan. The Administrator, in its sole discretion, may either pay any such dividend in cash or reinvest it in Common Stock on behalf of the terminating Participant. If such dividend is reinvested, the Administrator will sell the shares purchased and remit the proceeds to the Participant, less the Costs of Sale. After termination, dividends will be paid to the shareholder in cash unless and until the shareholder rejoins the Plan, which he or she may do at any time by requesting an Enrollment Form from the Administrator. In order to terminate participation in the Plan, a Participant must notify the Administrator in writing. When a Participant terminates, or upon termination of the Plan by the Company, certificates for whole shares credited to the Participant under the Plan will be issued and a cash payment will be made for any fraction of a share, less any Costs of Sale. The cash payment for the fraction of a share will be based on the current market price of the Common Stock. Upon termination, a Participant may also request the sale of all or a part of the whole shares of Common Stock credited to his or her Plan account. The Administrator will sell such shares and remit the proceeds to the Participant, less the Costs of Sale. Sale requests may be accumulated by the Administrator. The Administrator may at any time in its discretion terminate a Participant's interest in the Plan by sending written notice to the Participant at his or her last known address as shown on the Administrator's records. Upon such termination, a Participant will receive from the Administrator a certificate for the full shares of Common Stock credited to the Participant under the Plan and a cash payment for any fraction of a share, determined as of the close of business on the date of termination by the Administrator. -5- 7 15. VOTING RIGHTS. Each Participant will be sent a proxy card in connection with any annual or special shareholders' meeting. This proxy will apply to all shares registered in the Participant's name and to all shares of Common Stock credited to the Participant's Plan account. 16. STOCK DIVIDENDS AND SPLITS. Any dividends in the form of shares of Myers Stock and any shares resulting from a split of Myers Stock distributed by Myers on shares held of record by the Custodian will be retained by the Custodian and credited to the Participant's account and reflected in the next statement furnished to the Participant in accordance with the Plan. 17. DIVIDEND SECURITIES. In the event that Myers makes available to the holders of Myers Stock (i) rights to purchase additional shares of Myers Stock, convertible debentures or other securities of Myers, or (ii) any securities of any other issuer, the Custodian will sell such rights or other securities ("DIVIDEND SECURITIES") accruing to the shares of Myers Stock credited to Participants' accounts and apply the resulting funds to the purchase of additional shares of Myers' Stock for the Participants' accounts on the next Investment Date. The price at which the Custodian shall be deemed to have sold Dividend Securities for the Participants' accounts shall be the weighted average price, less brokerage commissions and any other costs of sale, of all Dividend Securities sold by the Custodian of the same class sold at substantially the same time. In the event a Participant desires to personally receive Dividend Securities, which may accrue in respect of full shares of Myers Stock credited to his account, the Participant must request distribution of certificates for such shares of Myers Stock at least five (5) business days prior to the record date for the issuance of the Dividend Securities. 18. TAXES. The fact that dividends are reinvested does not in any manner relieve a Participant of liability for taxes that may otherwise be payable in respect of dividends, any Dividend Securities, or any transactions effected under the Plan. 19. EFFECTIVE DATE OF THE PLAN. The effective date of the Plan is and the provisions of the Plan shall be in effect in respect of each Investment Date which occurs on or after May 1, 1993. -6- EX-21 7 MYERS INDUSTRIES 10-K405 EXHIBIT 21 1 EXHIBIT 21 SUBSIDIARIES OF REGISTRANT SUBSIDIARY NAME JURISDICTION Bert Schwarz - S & H, Inc. New York Buckhorn Inc. Delaware -BKHN Inc. Ohio -Buckhorn Rubber Products Inc. Missouri Eastern Tire Equipment & Supplies Limited Quebec, Canada Elrick Industries, Inc. California The James C. Heintz Company Ohio MICO, Inc. Ohio Midland Tire Supply, Inc. Indiana Myers International, Inc. Ohio Myers Systems, Inc. Ohio Myers Tire Supply (Canada) Limited Ontario, Canada Myers Tire Supply (Chicago), Inc. Illinois Myers Tire Supply (Nevada), Inc. Nevada Myers Tire Supply (Va.), Inc. Virginia Patch Rubber Company North Carolina Plastic Parts Inc. Kentucky EX-23 8 MYERS INDUSTRIES 10-K405 EXHIBIT 23 1 EXHIBIT 23 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation of our reports included and incorporated by reference in this Form 10-K, into the Company's previously filed Registration Statements on Form S-8 (Registration Statement Nos. 81693, 33-9038 and 33-47600) and Registration Statement on Form S-3 (Registration Statement No. 33-50286). ARTHUR ANDERSEN LLP /s/ Arthur Andersen LLP Cleveland, Ohio March 23, 1995 EX-27 9 MYERS INDUSTRIES 10-K405 EXHIBIT 27
5 YEAR DEC-31-1994 JAN-01-1994 DEC-31-1994 1,794,703 0 52,705,688 1,479,000 39,381,715 94,724,955 116,556,993 55,178,681 172,026,887 34,093,593 4,874,025 8,303,598 0 0 122,605,074 172,026,887 274,054,163 274,054,163 183,890,614 216,128,859 27,258,865 1,479,000 791,004 30,046,163 12,215,000 17,831,163 0 0 0 17,831,163 1.17 1.17