SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(MARK ONE)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 1, 2001
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ____________________
COMMISSION FILE NUMBER 1-11024
CLARCOR Inc.
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(Exact name of registrant as specified in its charter)
DELAWARE 36-0922490
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2323 Sixth Street, P.O. Box 7007, Rockford, Illinois 61125
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 815-962-8867
Securities registered pursuant to Section 12(b) of the Act:
NAME OF EACH EXCHANGE
TITLE OF EACH CLASS ON WHICH REGISTERED
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Common Stock, par value $1.00 per share New York Stock Exchange
Preferred Stock Purchase Rights
Securities registered pursuant to Section 12(g) of the Act:
None
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(Title of Class)
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 such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. Yes X No __
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [x]
The aggregate market value (based on the closing price of registrant's Common
Stock on February 1, 2002 as reported on the New York Stock Exchange Composite
Transactions) of the voting stock held by non-affiliates of the registrant as at
January 15, 2002 is $673,665,916.
The number of outstanding shares of Common Stock as of January 15, 2002 is
24,645,975 shares.
Certain portions of the registrant's 2001 Annual Report to Shareholders are
incorporated by reference in Parts I, II and IV. Certain portions of the
registrant's Proxy Statement dated February 15, 2002 for the Annual Meeting of
Shareholders to be held on March 19, 2002 are incorporated by reference in Part
III.
PART I
ITEM 1. DESCRIPTION OF BUSINESS.
(a) General Development of Business
CLARCOR Inc. ("CLARCOR") was organized in 1904 as an Illinois corporation
and in 1969 was reincorporated in the State of Delaware. As used herein, the
"Company" refers to CLARCOR and its subsidiaries unless the context otherwise
requires.
The Company's fiscal year ends on the Saturday closest to November 30. For
fiscal year 2001 the year ended on December 1, 2001 and included 52 weeks. For
fiscal year 2000 the year ended on December 2, 2000 and included 53 weeks. In
this Form 10-K, all references to fiscal years are shown to begin on December 1
and end on November 30 for clarity of presentation.
(i) Certain Significant Developments.
On June 4, 2001 the Company acquired several filtration management
companies for approximately $33,258,000 in cash. After the acquisition the
acquired companies were combined into one company, Total Filtration Services,
Inc. ("TFS"). TFS is included in the Industrial/Environmental Filtration segment
of the Company's business.
At the time of the acquisition, the acquired companies were engaged in the
business of supplying filtration products and equipment and filter maintenance
services to large manufacturing facilities including major automobile
manufacturing and assembly plants operated in the United States, Canada and
Mexico. The acquisition resulted in an increase of approximately $28,000,000 in
the Company's revenues for fiscal 2001.
In addition to the continuation of its existing business, TFS has been made
primarily responsible for the operation and development of the Company's "Total
Filtration Program." Under the Program, the Company will offer customers the
ability to purchase from the Company the filters needed by that customer for its
facilities and its manufacturing, transportation and construction equipment.
Customers that now purchase a broad range of filter products and services from
multiple suppliers will be able, by taking advantage of the Program, to purchase
all of their filter requirements through TFS, thereby reducing administrative
burdens and uncertainty about filter pricing, availability, delivery,
performance and longevity. The Company is confident that it will be able to
serve its customers' total filtration needs because it believes that it now
manufactures and supplies the broadest range of filtration products in the
industry. While the Program is in an early stage, several total filtration
management contracts were completed late in 2001 and negotiations continue on
others. The Company expects that the impact of these contracts will grow over
the next several years as these customers' facilities are converted to the
Program. In the future, the Total Filtration Program will serve as an added
distribution channel for all of the Company's filtration products.
(ii) Summary of Business Operations.
During 2001, the Company conducted business in three principal industry
segments: (1) Engine/Mobile Filtration, (2) Industrial/Environmental Filtration
and (3) Packaging.
Engine/Mobile Filtration. Engine/Mobile Filtration includes filters for
oil, air, fuel, coolants and hydraulic fluids for trucks, automobiles,
construction, mining and industrial equipment, locomotives, marine and
agricultural equipment.
Industrial/Environmental Filtration. Industrial/Environmental Filtration
products are used primarily for commercial, residential and industrial
applications. The segment's industrial and environmental products include air
and antimicrobial treated filters and high efficiency electronic air cleaners
for commercial buildings, factories, residential buildings, paint spray booths,
gas turbine systems, medical facilities, motor vehicle cabins, clean rooms,
compressors and dust collector systems. The segment's process filtration
products include specialty filters, industrial process liquid filters, filters
for pharmaceutical processes, filtration systems for aircraft refueling,
anti-pollution and water recycling, bilge separators and sand control filters
for oil and gas drilling.
2
Packaging. Packaging products include a wide variety of custom styled
containers and packaging items used primarily by the food, confectionery, spice,
drug, toiletries and chemical specialties industries. The segment's products
include lithographed metal containers, flat sheet decorated metal, combination
metal and plastic containers, plastic closures and various specialties, such as
spools for wire and cable and outer shells for dry cell batteries and film
canisters.
(b) Financial Information About Industry Segments
Business segment information for the fiscal years 1999 through 2001 is
included on pages 23 and 24 of the Company's 2001 Annual Report to Shareholders
(the "Annual Report"), is incorporated herein by reference and is filed as part
of Exhibit 13(a)(vi) to this 2001 Annual Report on Form 10-K ("2001 Form 10-K").
(c) Narrative Description of the Business
ENGINE/MOBILE FILTRATION
The Company's engine/mobile filtration products business is conducted by
the following wholly-owned subsidiaries: Baldwin Filters, Inc.; Clark Filter,
Inc.; Hastings Filters, Inc.; Baldwin Filters (Aust.) Pty. Ltd.; Baldwin Filters
N.V.; and Baldwin Filters Limited. In addition, the Company owns (i) 90% of
Filtros Baldwin de Mexico ("FIBAMEX"), (ii) 75% of Baldwin-Weifang Filters Ltd.,
and (iii) 80% of Baldwin-Unifil S.A.
The companies market a full line of oil, air, fuel, coolant and hydraulic
fluid filters. The filters are used in a wide variety of applications and in
processes where filter efficiency, reliability and durability are essential.
Impure air or fluid flow through semi-porous paper, cotton, synthetic, chemical
or membrane filter media with varying efficiency filtration characteristics. The
impurities on the media are disposed of when the filter is changed. The
segment's filters are sold throughout the world, primarily in the replacement
market for trucks, automobiles, locomotives, marine, construction, industrial,
mining and agricultural equipment. In addition, some first-fit filters are sold
to the original equipment market.
INDUSTRIAL/ENVIRONMENTAL FILTRATION
The Company's industrial/environmental filtration products business is
conducted by the following wholly-owned subsidiaries: Airguard Industries, Inc.
("Airguard"); Airklean Engineering Pte. Ltd.; Airguard Asia Sdn. Bhd.; Facet
USA, Inc. and related Facet companies in Italy, Spain, the United Kingdom and
other European locations ("Facet"); Filter Products, Inc.; Purolator Facet, Inc.
("PFI"); Purolator Products Air Filtration Company ("Purolator"); Total
Filtration Services, Inc. ("TFS"); United Air Specialists, Inc.; and United Air
Specialists (U.K.) Ltd. The segment's products are sold throughout the world.
The companies market commercial and industrial air filters and systems,
electrostatic contamination control equipment and electrostatic high precision
spraying equipment. The air filters and systems remove contaminants from
recirculated indoor air and from process air which is exhausted outdoors. The
products represent a complete line of air cleaners with a wide range of uses for
maintaining high quality standards in interior air and exterior pollution
control.
Additional products include specialty filters, filtration systems for
aircraft refueling, anti-pollution and water recycling, and bilge separators.
These products are used in a wide range of applications including commercial,
military and general aviation, marine, oil and gas drilling and refining,
chemical and pharmaceutical processes, utilities, paper mills and general
industry. The filters are used for the process filtration of liquids using a
variety of porous and sintered and non-sintered metal media filters, strainers,
separators, coalescers and absorbent media. Many of these filter products and
systems require special technical approvals and product certification in order
to meet commercial and military requirements.
TFS does not manufacture filtration products or equipment. It is engaged in
the business of supplying a full range of filtration products and equipment
acquired from the Company's subsidiaries and non-affiliated manufacturers to
manufacturers as well as providing filter maintenance and cleaning services for
the customer's filtration equipment. In addition, TFS is promoting and
developing the Company's Total Filtration Program. See Item 1.(a) (i) above for
a description of that Program.
3
PACKAGING
The Company's consumer and industrial packaging products business is
conducted by a wholly-owned subsidiary, J. L. Clark, Inc. ("J. L. Clark").
J.L. Clark manufactures a wide variety of different types and sizes of
containers and packaging specialties. Metal, plastic and combination
metal/plastic containers and closures manufactured by the Company are used in
packaging a wide variety of dry and paste form products, such as food
specialties (tea, spices, cookies, potato chips, pretzels, candy and other
confections); beverages and juices; cosmetics and toiletries; drugs and
pharmaceuticals; and chemical specialties (hand cleaners, soaps and special
cleaning compounds). Other packaging products include shells for dry batteries,
film canisters, candles, spools for insulated and fine wire, and custom
decorated flat steel sheets.
Containers and packaging specialties are manufactured only upon orders
received from customers, and individualized containers and packaging specialties
are designed and manufactured, usually with distinctive decoration, to meet each
customer's marketing and packaging requirements and specifications.
DISTRIBUTION
Engine/Mobile Filtration and Industrial/Environmental Filtration products
are sold primarily through a combination of independent distributors, dealers
for original equipment manufacturers and directly to end-use customers such as
truck and equipment fleet users.
The engine/mobile segment also distributes filtration products worldwide
through each of its subsidiaries. Baldwin Filters N.V. and Baldwin Filters
Limited primarily serve the European markets. Baldwin Filters (Aust.) Pty. Ltd.,
markets heavy duty liquid and air filters in Australia and New Zealand. FIBAMEX
manufactures filters in Mexico with distribution in Mexico and Central and South
America. Through the Company's investment in Baldwin-Weifang Filters Ltd., heavy
duty filters and electrostatic air pollution control systems are manufactured in
China for distribution in China. Additionally, through Baldwin-Unifil S.A., air
filtration products are manufactured in South Africa with distribution
throughout Africa, Great Britain, Europe and the Middle East.
The industrial/environmental segment also distributes and services
filtration products and equipment through company-owned branches and
subsidiaries located throughout the United States, Europe, Singapore, Malaysia
and China.
The Total Filtration Program is expected to become a significant
distribution channel for all of the filtration products and equipment
manufactured by the Company's subsidiaries.
Packaging salespersons call directly on customers and prospective customers
for containers and packaging specialties. Each salesperson is trained in all
aspects of J.L. Clark's manufacturing processes with respect to the products
sold and is qualified to consult with customers and prospective customers
concerning the details of their particular requirements. In addition,
salespersons with expertise in specific areas, such as flat-sheet decorating,
are focused on specific customers and markets.
CLASS OF PRODUCTS
No class of products accounted for as much as 10% of the total sales of the
Company.
RAW MATERIAL
Steel, filter media, cartons, aluminum sheet and coil, stainless steel,
chrome vanadium, chrome silicon, resins, gaskets, roll paper, bulk and roll
plastic materials and cotton, wood and synthetic fibers and adhesives are the
most important raw materials used in the manufacture of the Company's products.
All of these are purchased or are available from a variety of sources. The
Company has no long-term purchase commitments. The Company did not experience
shortages in the supply of raw materials during 2001.
4
PATENTS, TRADEMARKS AND TRADENAMES
Certain features of some of the Company's products are covered by domestic
and, in some cases, foreign patents or patent applications. While these patents
are valuable and important for certain products, the Company does not believe
that its competitive position is dependent upon patent protection. The Company
believes, however, that its trademarks and tradenames used in connection with
certain products are significant to its business.
CUSTOMERS
The largest 10 customers of the Engine/Mobile Filtration segment accounted
for 21.1% of the $250,960,000 of fiscal year 2001 sales of such segment.
The largest 10 customers of the Industrial/Environmental Filtration segment
accounted for 19.8% of the $346,394,000 of fiscal year 2001 sales of such
segment.
The largest 10 customers of the Packaging segment accounted for 71.0% of
the $69,610,000 of fiscal year 2001 sales of such segment.
No single customer accounted for 10% or more of the Company's consolidated
2001 sales.
BACKLOG
At November 30, 2001, the Company had a backlog of firm orders for products
amounting to approximately $65,500,000. The backlog figure for 2000 was
approximately $74,300,000. Substantially all of the orders on hand at November
30, 2001 are expected to be filled during fiscal 2002.
COMPETITION
The Company encounters strong competition in the sale of all of its
products. The Company competes in a number of filtration markets against a
variety of competitors. The Company is unable to state its relative competitive
position in all of these markets due to a lack of reliable industry-wide data.
However, in the replacement market for heavy duty liquid and air filters used in
internal combustion engines, the Company believes that it is among the top five
measured by annual sales. In addition, the Company believes that it is a leading
manufacturer of liquid and air filters for diesel locomotives. The Company
believes that for industrial and environmental filtration products, it is among
the top five competitors measured by annual sales.
In the Packaging segment, its principal competitors include several
manufacturers whose specialty packaging segments are smaller than the Company's
and who often compete on a regional basis only. Strong competition is also
presented by manufacturers of paper, plastic and glass containers. The Company's
competitors generally manufacture and sell a wide variety of products in
addition to packaging products of the type produced by the Company and do not
publish separate sales figures relative to these competitive products.
Consequently, the Company is unable to state its relative competitive position
in those markets.
The Company believes that it is able to maintain its competitive position
because of the quality and breadth of its products and services and the broad
geographic scope of its operations.
PRODUCT DEVELOPMENT
The Company's Technical Centers and laboratories test product components
and completed products to insure high quality manufacturing results, evaluate
competitive products, aid suppliers in the development of product components,
and conduct controlled tests of newly designed filters, filtration systems and
containers for particular uses. Product development departments are concerned
with the improvement and creation of new filters, filtration systems, containers
and packaging products in order to broaden the uses of these items, counteract
obsolescence and evaluate other products available in the marketplace.
In fiscal 2001, the Company employed 75 professional employees on either a
full-time or part-time basis on research activities relating to the development
of new products or the improvement or redesign of its
5
existing products. During this period the Company spent approximately $5,365,000
on such activities as compared with $6,942,000 for 2000 and $5,562,000 for 1999.
ENVIRONMENTAL FACTORS
The Company is not aware of any facts which would cause it to believe that
it is in material violation of existing applicable standards respecting
emissions to the atmosphere, discharges to waters, or treatment, storage and
disposal of solid or hazardous wastes.
The Company is party to various proceedings relating to environmental
issues. The U.S. Environmental Protection Agency (EPA) and/or other responsible
state agencies have designated the Company as a potentially responsible party
(PRP), along with other companies, in remedial activities for the cleanup of
waste sites under the federal Superfund statute.
Environmental and related remediation costs are difficult to quantify for a
number of reasons including the number of parties involved, the difficulty in
determining the extent of the contamination, the length of time remediation may
require, the complexity of environmental regulation and the continuing
advancement of remediation technology. Applicable federal law may impose joint
and several liability on each PRP for the cleanup. It is the opinion of
management that additional liabilities, if any, resulting from these matters are
not expected to have a material adverse effect on the Company's financial
condition or consolidated results of operations.
The Company does anticipate, however, that it may be required to install
additional pollution control equipment to augment existing equipment in the
future in order to meet applicable environmental standards. The Company is
presently unable to predict the timing or the cost of such equipment and cannot
give any assurance that the cost of such equipment may not have an adverse
effect on earnings. However, the Company is not aware, at this time, of any
current or pending requirement to install such equipment at any of its
facilities.
EMPLOYEES
As of November 30, 2001, the Company had approximately 4,545 employees.
(d) Financial Information About Foreign and Domestic Operations and Export
Sales
Financial information relating to export sales and the Company's operations
in the United States and other countries is set forth on page 24 of the Annual
Report and is incorporated herein by reference and filed as Exhibit 13(a)(vi) to
this 2001 Form 10-K. The Company is not aware of any unusual risks attendant to
the conduct of its operations in other countries.
ITEM 2. PROPERTIES.
(i) Location
An office building owned by the Company located in Rockford, Illinois
houses the Corporate offices in 22,000 square feet of office space.
Engine/Mobile Filtration. The following is a description of the principal
properties utilized by the Company in conducting its Engine/Mobile Filtration
business:
The Baldwin Filters' Kearney, Nebraska plant contains 516,000 square feet
of manufacturing and warehousing space, 25,000 square feet of research and
development space, and 40,000 square feet of office space. The Kearney facility
is located on a site of approximately 40 acres. A manufacturing facility located
in Yankton, South Dakota has approximately 170,000 square feet of floor space on
a 21 acre tract. Both facilities are owned by the Company. In addition, Baldwin
has a capital lease for a 100,000 square foot manufacturing facility on a site
of 20 acres in Gothenburg, Nebraska.
6
The Company also manufactures filters in Lancaster, Pennsylvania at its
Clark Filter plant. The building, constructed about 1968 on an 11.4 acre tract
of land, contains 168,000 square feet of manufacturing and office space and is
owned by the Company.
The Company leases various facilities in Australia, Belgium, Mexico, South
Africa and the United Kingdom for the manufacture and distribution of filtration
products.
Industrial/Environmental Filtration. The following is a description of the
principal properties utilized by the Company in conducting its
Industrial/Environmental Filtration business:
Airguard has eight manufacturing and warehousing locations. It leases
318,000 square feet in New Albany, Indiana, 84,000 square feet in Corona,
California, 44,500 square feet in Dallas, Texas and 83,000 square feet in
Rockford, Illinois and a smaller facility in North Carolina. The Company owns
the following three facilities. The Airguard High Efficiency Filter plant,
located in Jeffersontown, Kentucky on a 7.5 acre tract of land, contains 100,000
square feet of manufacturing and office facilities. During December, 2000
Airguard began production of air filtration products in a 290,000 square foot
manufacturing facility in Campbellsville, Kentucky. Airguard's ATI manufacturing
and office facility in Ottawa, Kansas, contains 31,000 square feet.
Airguard administrative and sales offices and distribution facilities are
located in leased facilities in Louisville, Kentucky; Cincinnati, Ohio; Toledo,
Ohio; Nashville, Tennessee; Atlanta, Georgia; Columbus, Ohio; Birmingham,
Alabama; Portland, Oregon; Commerce City, Colorado; Kansas City, Missouri;
Dallas, Texas; Corona, California and New Albany, Indiana. Airguard leases
facilities in Malaysia and Singapore.
Facet owns manufacturing and distribution facilities in Tulsa, Oklahoma and
La Coruna, Spain. The Tulsa facilities contain approximately 142,000 square feet
on a 16 acre site. The La Coruna facility is on an approximately 17,000 square
meter site and the building contains 5,700 square meters. Facet also leases
facilities in Stillwell, Oklahoma; Tulsa, Oklahoma; Italy; Germany; France;
United Kingdom and The Netherlands.
Purolator owns a 228,500 square-foot manufacturing and office facility in
Henderson, North Carolina on a site of approximately 25 acres. Purolator also
owns a 42,500 square foot manufacturing and office facility in Kenly, North
Carolina. Purolator leases sales, manufacturing and distribution facilities in
Fresno, California; Hayward, California; Sacramento, California; Davenport,
Iowa; Wichita, Kansas; Metuchen, New Jersey; Henderson, North Carolina; Sparks,
Nevada; Fairfax, Virginia and Auburn, Washington.
Purolator Facet, Inc. ("PFI") owns a manufacturing and distribution
facility in Greensboro, North Carolina. This facility contains approximately
88,000 square feet on a 21 acre site. PFI also leases facilities in Greensboro,
North Carolina; Hebron, Connecticut and Middletown, Rhode Island.
TFS leases 85,000 square feet of headquarters space in Rochester Hills,
Michigan. In addition, it leases office or warehouse space in Cincinnati, Ohio;
Toledo, Ohio; Fort Wayne, Indiana; Indianapolis, Indiana; Tonwanda, New York;
Saginaw, Michigan; and several locations in Mexico and Canada. It also owns an
office and warehouse facility consisting of a total of 33,000 square feet in
Goodlettsville, Tennessee.
United Air Specialists ("UAS") has three owned facilities. The offices and
primary manufacturing facility of UAS are located in Blue Ash, Ohio (a suburb of
Cincinnati), on approximately 17 acres of land. This facility was built in 1978
and was expanded in 1991 and 1993 to a total of approximately 157,000 square
feet. UAS also has sales offices and a manufacturing facility in Warwick,
England which total approximately 13,200 square feet. In addition, UAS leases
sales and service facilities in Bad Camberg, Germany; Phoenix, Arizona; Hayward,
California; Anaheim, California; Louisville, Kentucky; Troy, Michigan; Jackson,
Mississippi and Houston, Texas.
Filter Products Inc. owns a 40,000 square foot manufacturing and office
facility in Sacramento, California.
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Packaging. The following is a description of the principal properties
utilized by the Company in conducting its Packaging business:
The Company's J. L. Clark, Rockford, Illinois plant, located on 34 acres,
consists of one-story manufacturing buildings, the first of which was
constructed in 1910. Since then a number of major additions have been
constructed and an injection molding plant was constructed in 1972.
Approximately 450,000 square feet of floor area are devoted to manufacturing,
warehouse and office use. Of the 34 acres, approximately 12 are vacant.
A J. L. Clark plant is located in Lancaster, Pennsylvania on approximately
11 acres. It consists of a two-story office building containing approximately
7,500 square feet of floor space and a manufacturing plant and warehouse
containing 236,000 square feet of floor space, most of which is on one level.
These buildings were constructed between 1924 and 1964.
J. L. Clark also leases a manufacturing facility in Lathrop, California.
The various properties owned by the Company are considered by it to be in
good repair and well maintained. Plant asset additions in 2002 are estimated at
$21,000,000 to $23,000,000 for land, buildings, equipment and machinery and cost
reduction projects.
(ii) Function
Engine/Mobile Filtration. Oil, air, fuel, hydraulic fluid and coolant
filters are produced at the Baldwin and Hastings facilities in Kearney, and
Gothenburg, Nebraska and Yankton, South Dakota. The various processes of
pleating paper, winding cotton and synthetic fibers, placing the filter element
in a metal or fiber container and painting the containers are highly mechanized,
but require some manual assistance. The plants also maintain an inventory of
special dies and molds for filter manufacture.
Oil, air and fuel filters, primarily for use in the railroad industry, are
produced at Clark Filter in Lancaster, Pennsylvania.
Industrial/Environmental Filtration. Air filters for the commercial,
residential and industrial markets are produced in the Airguard and Purolator
facilities. Dust collection systems, high efficiency electronic air cleaning
systems and electrostatic precision spraying systems are designed and
manufactured at the UAS facility in Cincinnati, Ohio.
Specialty filter products for aviation, oil and gas drilling, military,
marine and paper and chemical processes are manufactured and assembled at the
PFI facilities in Greensboro, North Carolina. The manufacturing processes
include bonding and sintering metal, tungsten inert gas and electron beam
welding and diffusion-bonding of wire. Facet designs, manufactures and assembles
filters and filtration systems for aircraft refueling, power generation, water
treatment and general industrial applications at its United States and European
facilities. The company also uses outside contractors for assembly and
manufacturing of some of its products. Many of these products require special
commercial or military technical approvals or product certification.
Depth media filters for the pharmaceutical, biotech and food and beverage
industries and other critical process filtration applications are manufactured
at the Filter Products Inc. facility in Sacramento, California.
Packaging. The Company's metal and combination metal and plastic packaging
products are produced at J. L. Clark plants located in Rockford, Illinois,
Lancaster, Pennsylvania, and Lathrop, California. The Rockford and Lancaster
plants are completely integrated facilities which include creative and
mechanical art departments and photographic facilities for color separation,
preparation of multiple-design negatives and lithographing plates. Metal sheets
are decorated on coating machines and lithographing presses connected with
conveyor ovens. Decorated sheets are then cut to working sizes on shearing
equipment, following which fabrication is completed by punch presses,
can-forming and can-closing equipment and other specialized machinery for
supplementary operations.
Plastic packaging capabilities include molding and labeling of irregular
shaped plastic containers and customized plastic closures which have
tamper-evidence as well as convenience features.
8
ITEM 3. LEGAL PROCEEDINGS.
The Company is involved in legal actions arising in the normal course of
business. Management is of the opinion that the outcome of these actions will
not have a material adverse effect on the Company's consolidated results of
operations or financial position.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None.
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ADDITIONAL ITEM: EXECUTIVE OFFICERS OF THE REGISTRANT
AGE AT YEAR ELECTED
NAME 11/30/01 TO OFFICE
---- -------- ------------
Norman E. Johnson........................................... 53 2000
Chairman of the Board, President and Chief Executive
Officer. Mr. Johnson has been employed by the Company since
1990. He was elected President-Baldwin Filters, Inc. in
1990, Vice President-CLARCOR in 1992, Group Vice President-
Filtration Products Group in 1993, President and Chief
Operating Officer in 1995 and Chairman, President and Chief
Executive Officer in 2000. Mr. Johnson has been a Director
of the Company since June 1996.
William B. Walker........................................... 61 2000
President, Environmental Filtration. Mr. Walker has been
employed by Airguard, a subsidiary of the Company since
1966. He was elected President of Airguard in 1994,
Executive Vice President-Industrial/Environmental Filtration
in 1999 and President, Environmental Filtration in 2000.
Bruce A. Klein.............................................. 54 1995
Vice President-Finance and Chief Financial Officer. Mr.
Klein was employed by the Company and elected Vice
President-Finance and Chief Financial Officer on January 3,
1995.
David J. Anderson........................................... 63 1999
Vice President-Corporate Development. Mr. Anderson has
been employed by the Company since 1990. He was elected Vice
President Marketing & Business Development for the CLARCOR
Filtration Products subsidiary in 1991, Vice
President-Corporate Development in 1993, Vice
President-International/Corporate Development in 1994 and
Vice President-Corporate Development in 1999.
David J. Lindsay............................................ 46 1995
Vice President-Administration and Chief Administrative
Officer. Mr. Lindsay has been employed by the Company in
various administrative positions since 1987. He was elected
Vice President-Group Services in 1991, Vice
President-Administration in 1994 and Vice
President-Administration and Chief Administrative Officer in
1995.
Peter F. Nangle............................................. 40 1999
Vice President-Information Services and Chief Information
Officer. Mr. Nangle has been employed by the Company since
1993. He was elected Vice President-Information Services in
1994, Vice President-Information Services and Operations
Analysis, Chief Information Officer in 1997 and Vice
President-Information Services and Chief Information Officer
in 1999.
Marcia S. Blaylock.......................................... 45 2000
Vice President, Controller. Ms. Blaylock has been an
employee of the Company since 1974. She was elected
Assistant Secretary in 1994, Corporate Secretary in 1995,
Vice President and Corporate Secretary in 1996, Vice
President, Controller and Corporate Secretary in 1997 and
Vice President, Controller in 2000.
David J. Boyd............................................... 61 2000
Vice President, General Counsel and Corporate Secretary.
Mr. Boyd became an officer of the Company in May 2000. Prior
to that date he served as a partner in the law firm of
Sidley Austin Brown & Wood since 1972.
Mr. James M. Suchomel was President of the Company's Process Filtration
Group until his death on October 24, 2001.
Each executive officer of the Company is elected for a term of one year
which begins at the Board of Directors Meeting at which he or she is elected,
held at the time of the Annual Meeting of Shareholders, and ends on the date of
the next Annual Meeting of Shareholders or upon the due election and
qualification of his or her successor.
10
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED SHAREHOLDER
MATTERS.
The Company's Common Stock is listed on the New York Stock Exchange; it is
traded under the symbol CLC. The following table sets forth the high and low
market prices as quoted during the relevant periods on the New York Stock
Exchange and dividends paid for each quarter of the last two fiscal years.
MARKET PRICE
-----------------
QUARTER ENDED HIGH LOW DIVIDENDS
------------- ---- --- ---------
March 3, 2001............................................... $25.375 $16.875 $.1175
June 2, 2001................................................ 26.844 22.500 .1175
September 1, 2001........................................... 27.547 24.656 .1175
December 1, 2001............................................ 27.594 21.906 .1200
------
Total Dividends............................................. $.4725
======
MARKET PRICE
-----------------
QUARTER ENDED HIGH LOW DIVIDENDS
------------- ---- --- ---------
February 26, 2000........................................... $19.500 $16.063 $.1150
May 27, 2000................................................ 19.750 17.000 .1150
August 26, 2000............................................. 21.375 17.375 .1150
December 2, 2000............................................ 21.438 16.938 .1175
------
Total Dividends............................................. $.4625
======
The approximate number of holders of record of the Company's Common Stock
at January 15, 2002 is 1,500. In addition, the Company believes that there are
approximately 6,000 beneficial owners whose shares are held in street names.
ITEM 6. SELECTED FINANCIAL DATA.
The information required hereunder is set forth on pages 26 and 27 of the
Annual Report under the caption "11-Year Financial Review," is incorporated
herein by reference and is filed as Exhibit 13(a)(ix) to this 2001 Form 10-K.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATION.
The information required hereunder is set forth on pages 7 through 11 of
the Annual Report under the caption "Financial Review," is incorporated herein
by reference and is filed as Exhibit 13(a)(x) to this 2001 Form 10-K.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
The information required hereunder is set forth on page 10 of the Annual
Report under the caption "Financial Review -- Market Risk," is incorporated
herein by reference and is filed as Exhibit 13(a)(x) to this 2001 Form 10-K.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
The Consolidated Financial Statements, the Notes thereto and the report
thereon of PricewaterhouseCoopers LLP, independent accountants, required
hereunder with respect to the Company and its consolidated subsidiaries are set
forth on pages 12 through 25, inclusive, of the Annual Report, are incorporated
herein by reference and are filed as Exhibits 13(a)(ii) through 13(a)(vii) to
this 2001 Form 10-K.
11
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
None.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
Certain information required hereunder is set forth on pages 1 and 2 of the
Company's Proxy Statement dated February 15, 2002 (the "Proxy Statement") for
the Annual Meeting of Shareholders to be held on March 19, 2002 under the
caption "Election of Directors -- Nominees for Election to the Board" and is
incorporated herein by reference.
ITEM 11. EXECUTIVE COMPENSATION.
The information required hereunder is set forth on pages 6 through 13
inclusive, of the Proxy Statement under the caption "Compensation of Executive
Officers and Other Information" and is incorporated herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The information required hereunder is set forth on pages 4 and 5 of the
Proxy Statement under the caption "Beneficial Ownership of the Company's Common
Stock" and is incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
The information required hereunder is set forth on page 4 of the Proxy
Statement under the caption "Certain Relationships and Related Transactions" and
is incorporated herein by reference.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K.
(a) Financial Statements
The following financial information is incorporated herein by reference to
the Company's Annual Report to Shareholders for the fiscal year ended November
30, 2001:
*Consolidated Balance Sheets at November 30, 2001 and 2000
*Consolidated Statements of Earnings for the years ended November 30, 2001,
2000 and 1999
*Consolidated Statements of Shareholders' Equity for the years ended
November 30, 2001, 2000 and 1999
*Consolidated Statements of Cash Flows for the years ended November 30,
2001, 2000 and 1999
*Notes to Consolidated Financial Statements
*Report of Independent Accountants
*Management's Report on Responsibility for Financial Reporting
------------------------------
*Filed herewith as part of Exhibit 13(a) to this 2001 Form 10-K
12
The following items are set forth herein on the pages indicated:
Report of Independent Accountants.......................................... F-1
Financial Statement Schedules:
II. Valuation and Qualifying Accounts................................. F-2
Financial statements and schedules other than those listed above are
omitted for the reason that they are not applicable, are not required, or the
information is included in the financial statements or the footnotes therein.
(b) None
(c) Exhibits
3.1 The registrant's Second Restated Certificate of
Incorporation. Incorporated by reference to Exhibit 3.1 to
the Company's Annual Report on Form 10-K for the fiscal year
ended November 30, 1998.
3.1(a) Amendment to ARTICLE FOURTH of the Second Restated
Certificate of Incorporation. Incorporated by reference to
the Company's Proxy Statement dated February 18, 1999 for
the Annual Meeting of Shareholders held on March 23, 1999.
3.2 The registrant's By-laws, as amended. Incorporated by
reference to Exhibit 3.2 to the Company's Annual Report on
Form 10-K for the fiscal year ended November 30, 1995.
3.3 Certificate of Designation of Series B Junior Participating
Preferred Stock of CLARCOR as filed with the Secretary of
State of the State of Delaware on April 2, 1996.
Incorporated by reference to Exhibit 4.5 to the Registration
Statement on Form 8-A filed April 3, 1996.
4.1 Stockholder Rights Agreement dated as of March 28, 1996
between the registrant and the First Chicago Trust Company
of New York. Incorporated by reference to Exhibit 4 to the
Company's Current Report on Form 8-K filed April 3, 1996.
4.1(a) First Amendment to Stockholders Rights Agreement dated as of
March 23, 1999. Incorporated by reference to Exhibit 4 to
the Company's Form 8-A/A filed March 29, 1999.
4.2 Certain instruments defining the rights of holders of
long-term debt securities of CLARCOR and its subsidiaries
are omitted pursuant to Item 601(b)(4)(iii)(A) of Regulation
S-K. CLARCOR hereby agrees to furnish copies of these
instruments to the SEC upon request.
4.2(a) Multicurrency Credit Agreement dated as of September 9,
1999. Incorporated by reference to Exhibit 4 to the
Company's Current Report on Form 8-K filed September 17,
1999.
10.1 The registrant's Deferred Compensation Plan for Directors.
Incorporated by reference to Exhibit 10.1 to the Company's
Annual Report on Form 10-K for the fiscal year ended
November 30, 1984 (the "1984 10-K").
10.2 The registrant's Supplemental Retirement Plan. Incorporated
by reference to Exhibit 10.2 to the 1984 10-K.
10.2(a) The registrant's 1994 Executive Retirement Plan.
Incorporated by reference to Exhibit 10.2(a) to the
Company's Annual Report on Form 10-K for the fiscal year
ended December 3, 1994 ("1994 10-K").
10.2(b) The registrant's 1994 Supplemental Pension Plan.
Incorporated by reference to Exhibit 10.2(b) to the 1994
10-K.
10.2(c) The registrant's Supplemental Retirement Plan (as amended
and restated effective December 1, 1994). Incorporated by
reference to Exhibit 10.2(c) to the 1994 10-K.
10.3 The registrant's 1984 Stock Option Plan. Incorporated by
reference to Exhibit A to the Company's Proxy Statement
dated March 2, 1984 for the Annual Meeting of Shareholders
held on March 31, 1984.
13
10.4 Employment Agreements with certain officers. Incorporated by reference to Exhibit 5 to the
Company's Current Report on Form 8-K filed July 25, 1989.
10.4(a)(1) Form of Amended and Restated Employment Agreement with each of David J. Anderson, Marcia S.
Blaylock, David J. Boyd, Bruce A. Klein, David J. Lindsay, Norman E. Johnson, Peter F. Nangle, and
William B. Walker. Incorporated by Reference to Exhibit 10.4(a)(1) to the Company's Annual Report
on Form 10-K for the fiscal year ended December 2, 2000 (the "2000 10-K").
10.4(b) Employment Agreement with Lawrence E. Gloyd dated July 1, 1997. Incorporated by reference to
Exhibit 10.4(b) to the Company's Annual Report on Form 10-K for the fiscal year ended November 30,
1997 ("1997 10-K").
10.4(c) Employment Agreement with Norman E. Johnson dated July 1, 1997. Incorporated by reference to
Exhibit 10.4(c) to the 1997 10-K.
10.4(c)(1) Amended and Restated Employment Agreement with Norman E. Johnson dated as of December 17, 2000.
Incorporated by Reference to Exhibit 10.4(c)(1) to the 2000 10-K.
10.4(d) Trust Agreement dated December 1, 1997. Incorporated by reference to Exhibit 10.4(d) to the 1997
10-K.
10.4(e) Executive Benefit Trust Agreement dated December 22, 1997. Incorporated by reference to Exhibit
10.4(e) to the 1997 10-K.
10.5 The registrant's 1994 Incentive Plan (the "Plan") as amended through June 30, 2000. Incorporated
by Reference to Exhibit 10.5 to the 2000 10-K.
10.5(a) Amendment to the Plan adopted December 18, 2000. Incorporated by Reference to Exhibit 10.5(a) to
the 2000 10-K.
*13 (a) The following items incorporated by reference herein from the Company's 2001 Annual Report to
Shareholders ("2001 Annual Report"), are filed as Exhibits to this Annual Report Form 10-K:
(i) Business segment information for the fiscal years 1999
through 2001 set forth on pages 23 and 24 of the 2001
Annual Report (included in Exhibit 13(a)(vi) -- Note Q
of Notes to Consolidated Financial Statements);
(ii) Consolidated Balance Sheets of the Company and its
Subsidiaries at November 30, 2001 and 2000 set forth on
page 12 of the 2001 Annual Report;
(iii) Consolidated Statements of Earnings of the Company and
its Subsidiaries for the years ended November 30, 2001,
2000 and 1999 set forth on page 13 of the 2001 Annual
Report;
(iv) Consolidated Statements of Shareholders' Equity for the
Company and its Subsidiaries for the years ended
November 30, 2001, 2000 and 1999 set forth on page 14
of the 2001 Annual Report;
(v) Consolidated Statements of Cash Flows of the Company
and its Subsidiaries for the years ended November 30,
2001, 2000 and 1999 set forth on page 15 of the 2001
Annual Report;
(vi) Notes to Consolidated Financial Statements set forth on
pages 16 through 24 of the 2001 Annual Report;
(vii) Report of Independent Accountants set forth on page 25
of the 2001 Annual Report;
(viii) Management's Report on Responsibility for Financial
Reporting set forth on page 25 of the 2001 Annual
Report;
(ix) Information under the caption "11-Year Financial
Review" set forth on pages 26 and 27 of the 2001 Annual
Report; and
(x) Management's Discussion and Analysis of Financial
Condition and Results of Operation set forth under the
caption "Financial Review" on pages 7 through 11 of the
2001 Annual Report.
14
*21 Subsidiaries of the Registrant.
*23 Consent of Independent Accountants.
---------------
* Filed herewith.
15
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.
Date: February 15, 2002 CLARCOR Inc.
(Registrant)
By: /s/ NORMAN E. JOHNSON
--------------------------------------
Norman E. Johnson
Chairman of the Board, President
& Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
Date: February 15, 2002 By: /s/ NORMAN E. JOHNSON
------------------------------------------------
Norman E. Johnson
Chairman of the Board, President &
Chief Executive Officer and Director
Date: February 15, 2002 By: /s/ BRUCE A. KLEIN
------------------------------------------------
Bruce A. Klein
Vice President -- Finance &
Chief Financial Officer
Date: February 15, 2002 By: /s/ MARCIA S. BLAYLOCK
------------------------------------------------
Marcia S. Blaylock
Vice President, Controller & Chief Accounting
Officer
Date: February 15, 2002 By:
------------------------------------------------
J. Marc Adam
Director
Date: February 15, 2002 By: /s/ MILTON R. BROWN
------------------------------------------------
Milton R. Brown
Director
Date: February 15, 2002 By:
------------------------------------------------
Robert J. Burgstahler
Director
Date: February 15, 2002 By: /s/ LAWRENCE E. GLOYD
------------------------------------------------
Lawrence E. Gloyd
Director
16
Date: February 15, 2002 By: /s/ ROBERT H. JENKINS
------------------------------------------------
Robert H. Jenkins
Director
Date: February 15, 2002 By: /s/ PHILIP R. LOCHNER, JR.
------------------------------------------------
Philip R. Lochner, Jr.
Director
Date: February 15, 2002 By: /s/ JAMES L. PACKARD
------------------------------------------------
James L. Packard
Director
Date: February 15, 2002 By: /s/ KEITH E. WANDELL
------------------------------------------------
Keith E. Wandell
Director
17
REPORT OF INDEPENDENT ACCOUNTANTS
ON FINANCIAL STATEMENT SCHEDULE
To the Board of Directors and Shareholders
CLARCOR Inc.
Rockford, Illinois
Our audits of the consolidated financial statements referred to in our report
dated January 8, 2002 appearing on page 25 in the 2001 Annual Report to
Shareholders of CLARCOR Inc. and Subsidiaries (which report and consolidated
financial statements are incorporated by reference in this Annual Report on Form
10-K) also included an audit of the financial statement schedule listed in Item
14(a) of this Form 10-K (page 13, index of exhibits). In our opinion, the
financial statement schedule presents fairly, in all material respects, the
information set forth therein when read in conjunction with the related
consolidated financial statements.
/s/ PricewaterhouseCoopers LLP
Chicago, Illinois
January 8, 2002
F-1
CLARCOR INC.
SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS
FOR THE YEARS ENDED NOVEMBER 30, 2001, 2000 AND 1999
(DOLLARS IN THOUSANDS)
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
-------------------------------------------- ---------- ----------------------- ---------- ----------
ADDITIONS
-----------------------
(1) (2)
BALANCE AT CHARGED TO CHARGED TO BALANCE AT
BEGINNING COSTS AND OTHER END OF
DESCRIPTION OF PERIOD EXPENSES ACCOUNTS DEDUCTIONS PERIOD
-------------------------------------------- ---------- ---------- ---------- ---------- ----------
2001:
Allowance for losses on accounts
receivable................................ $5,027 $1,628 $2,286(A) $1,021(B) $7,920
====== ====== ====== ====== ======
2000:
Allowance for losses on accounts
receivable................................ $5,155 $1,167 $ 17(A) $1,312(B) $5,027
====== ====== ====== ====== ======
1999:
Allowance for losses on accounts
receivable................................ $2,711 $ 975 $2,255(A) $ 786(B) $5,155
====== ====== ====== ====== ======
NOTES:
(A) Due to business acquisitions.
(B) Bad debts written off during year, net of recoveries.
F-2