|
|

SECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549
FORM 10-Q

|(Mark One) |                                                                                                                                        | 
|---------- | -------------------------------------------------------------------------------------------------------------------------------------- | 
|           |                                                                                                                                        | 
|S          | QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended September 30, 2005 | 
|           | OR                                                                                                                                     | 
|£          | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934                                           | 

For
the transition period from ________ to ________

Commission File Number 001-14789

GENTEK INC.(Exact
name of registrant as specified in its charter)

|Delaware                                                           |  | 02-0505547                                   
|------------------------------------------------------------------ |  | ---------------------------------------------
|(State of other jurisdiction of
    incorporation or organization) |  | (I.R.S. Employer
      Identification
Number)
|                                                                   |  |                                              
|90 East Halsey Road
      Parsippany, New
Jersey                   |  | 07054                                        
|(Address of principal executive offices)                           |  | (Zip Code)                                   

(973) 515-3221(Registrants telephone number, including area code)

|Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Yes S     No £                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                        
|Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).                                                                                                                                                                                                                                   
|Yes S     No £                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                        
|APPLICABLE TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE 
    PRECEEDING FIVE YEARS:                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                        
|Indicate by checkmark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.                                                                                                
|Yes S     No £                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                        
|The
      number of outstanding shares of the Registrants Common Stock as of
      October 31, 2005 was 10,138,676.                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                        

|
|

GENTEK INC.
FORM 10-Q
QUARTERLY PERIOD ENDED SEPTEMBER 30, 2005
INDEX
Page No.PART I.  FINANCIAL INFORMATION:Item 1.
    Financial StatementsConsolidated Statements of Operations  Three Months and Nine MonthsEnded September 30, 2005 and 2004
    1Consolidated Balance Sheets  September 30, 2005 andDecember 31, 2004
    2Consolidated Statements of Cash Flows  Nine MonthsEnded September 30, 2005 and 2004
    3Consolidated Statement of Changes in Equity  Nine MonthsEnded September 30, 2005
    4Notes to the Consolidated Financial Statements
    5-13Item 2.
    Managements Discussion and Analysis of FinancialCondition and Results of Operations
    14-22Item 3.
    Quantitative and Qualitative Disclosures About Market Risk
    22-23Item 4.
    Controls and Procedures
    23PART II.  OTHER INFORMATION:Item 1.
    Legal Proceedings
    24Item 2.
    Unregistered Sales of Equity Securities and Use of Proceeds
    24Item 3.
    Defaults upon Senior Securities
    24Item 4.
    Submission of Matters to a Vote of Security Holders
    24Item 5.
    Other Information
    24Item 6.
    Exhibits
    25-28SIGNATURES
    29
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
GENTEK INC.CONSOLIDATED STATEMENTS OF OPERATIONS(In thousands, except per share data)(unaudited)
Three Months Ended
      September 30,
    
    Nine Months Ended
      September 30,2005
    
    2004
    
    2005
    
    2004Net revenues
    
    $
    237,521
    
    $
    228,137
    
    $
    686,369
    
    $
    615,786Cost of sales
    
    
    207,928
    
    
    196,144
    
    
    595,656
    
    
    525,215Selling, general and administrative expense
    
    
    18,015
    
    
    19,796
    
    
    57,219
    
    
    62,057Restructuring and impairment charges
    
    
    3,133
    
    
    2,288
    
    
    7,527
    
    
    9,332Pension curtailment and settlement (gains) losses
    
    
    626
    
    
    
    
    
    626
    
    
    (13,414
    )Operating profit
    
    
    7,819
    
    
    9,909
    
    
    25,341
    
    
    32,596Interest expense
    
    
    7,952
    
    
    686
    
    
    20,767
    
    
    7,811Interest income
    
    
    210
    
    
    221
    
    
    408
    
    
    389Other (income) expense, net
    
    
    (3,988
    )
    
    12,432
    
    
    (2,587
    )
    
    11,363Income (loss) from continuing operationsbefore income taxes
    
    
    4,065
    
    
    (2,988
    )
    
    7,569
    
    
    13,811Income tax provision
    
    
    2,301
    
    
    779
    
    
    4,074
    
    
    8,653Income (loss) from continuing operations
    
    
    1,764
    
    
    (3,767
    )
    
    3,495
    
    
    5,158Income (loss) from discontinued operations (net oftax of $(213), $1,651, $(1,447)and $87,367 for thethree and nine month periods ended September 30,2005 and 2004, respectively)
    
    
    (429
    )
    
    (1,526
    )
    
    (2,211
    )
    
    189,472Net income (loss)
    
    $
    1,335
    
    $
    (5,293
    )
    $
    1,284
    
    $
    194,630Income (loss) per common share  basic:Income (loss) from continuing operations
    
    $
    0.17
    
    $
    (0.38
    )
    $
    0.35
    
    $
    0.51Income (loss) from discontinued operations
    
    
    (0.04
    )
    
    (0.15
    )
    
    (0.22
    )
    
    18.95Net income (loss)
    
    $
    0.13
    
    $
    (0.53
    )
    $
    0.13
    
    $
    19.46Income (loss) per common share  assuming dilution:Income (loss) from continuing operations
    
    $
    0.17
    
    $
    (0.38
    )
    $
    0.35
    
    $
    0.51Income (loss) from discontinued operations
    
    
    (0.04
    )
    
    (0.15
    )
    
    (0.22
    )
    
    18.94Net income (loss)
    
    $
    0.13
    
    $
    (0.53
    )
    $
    0.13
    
    $
    19.45See the accompanying notes to the consolidated financial statements.
-1-
GENTEK INC.CONSOLIDATED BALANCE SHEETS(In thousands, except share data)(unaudited)
September 30,
      2005
    
    December 31,
      2004ASSETSCurrent assets:Cash and cash equivalents
    $
    11,305
    
    $
    9,826Receivables, net
    
    137,347
    
    
    117,635Inventories
    
    77,098
    
    
    76,174Deferred income taxes
    
    12,517
    
    
    14,225Other current assets
    
    14,996
    
    
    7,370Total current assets
    
    253,263
    
    
    225,230Property, plant and equipment, net
    
    273,742
    
    
    283,051Goodwill
    
    154,416
    
    
    154,365Intangible assets, net
    
    65,559
    
    
    70,532Deferred income taxes
    
    3,458
    
    
    3,737Assets held for sale
    
    2,117
    
    
    2,868Other assets
    
    14,908
    
    
    13,843Total assets
    $
    767,463
    
    $
    753,626LIABILITIES AND EQUITYCurrent liabilities:Accounts payable
    $
    65,974
    
    $
    55,294Accrued liabilities
    
    74,614
    
    
    71,562Current portion of long-term debt
    
    4,101
    
    
    1,489Total current liabilities
    
    144,689
    
    
    128,345Long-term debt
    
    363,604
    
    
    11,047Pension and postretirement obligations
    
    102,876
    
    
    142,758Other liabilities
    
    65,966
    
    
    71,049Total liabilities
    
    677,135
    
    
    353,199Equity:Preferred Stock, $.01 par value; authorized: 10,000,000 shares;
      none issued or outstanding
    
    
    
    
    Common
      Stock, no par value; authorized: 100,000,000 shares;
            issued: 10,137,996 and 10,098,570 shares
      at September 30, 2005
            and December 31, 2004, respectively
    
    80,652
    
    
    271,690Unearned compensation
    
    (694
    )
    
    (2,123
    )Warrants
    
    8,361
    
    
    8,361Accumulated other comprehensive loss
    
    (436
    )
    
    (886
    )Retained earnings
    
    2,531
    
    
    123,385Treasury stock, at cost: 5,191 shares at September 30, 2005
    
    (86
    )
    
    Total equity
    
    90,328
    
    
    400,427Total liabilities and equity
    $
    767,463
    
    $
    753,626See the accompanying notes to the consolidated financial statements.
-2-
GENTEK INC.CONSOLIDATED STATEMENTS OF CASH FLOWS(In thousands)(unaudited)
Nine
      Months Ended
      September 30,2005
    
    2004Cash flows
      from operating activities:Net
      income
    $
    1,284
    
    $
    194,630Adjustments
      to reconcile net income to net cash provided by
            (used for) operating activities:(Income)
      loss from discontinued operations
    
    2,211
    
    
    (189,472
    )Depreciation
      and amortization
    
    34,066
    
    
    35,009Pension
      curtailment gain
    
    
    
    
    (13,414
    )Asset
      impairment charges
    
    1,400
    
    
    Net
      loss (gain) on disposition of long-term assets
    
    (1,381
    )
    
    10,725Long-term
      incentive plan costs, net
    
    1,001
    
    
    1,212Increase
      in receivables
    
    (20,878
    )
    
    (28,942
    )Increase
      in inventories
    
    (3,593
    )
    
    (10,721
    )(Increase)
      decrease in deferred tax assets
    
    (131
    )
    
    8,536Increase
      in accounts payable
    
    11,583
    
    
    29,922Increase
      (decrease) in accrued liabilities
    
    1,344
    
    
    (36,455
    )Decrease
      in other liabilities and assets, net
    
    (38,056
    )
    
    (687
    )Net
      cash provided by (used for) discontinued operations
    
    (877
    )
    
    21,492Net
      cash provided by (used for) operating activities
    
    (12,027
    )
    
    21,835Cash flows
      from investing activities:Capital
      expenditures
    
    (20,721
    )
    
    (16,554
    )Proceeds
      from sales or disposals of long-term assets
    
    2,445
    
    
    5,265Purchase
      of short-term investments
    
    (2,229
    )
    
    Proceeds
      from sale of business, net
    
    
    
    
    290,575Acquisition
      of business, net of cash acquired*
    
    
    
    
    (3,649
    )Other
      investing activities
    
    
    
    
    (49
    )Net
      cash provided by (used for) discontinued operations
    444
    
    (3,109
    )Net
      cash provided by (used for) investing activities
    
    (20,061
    )
    
    272,479Cash flows
      from financing activities:Proceeds
      from long-term debt
    
    404,581
    
    
    23,654Repayment
      of long-term debt
    
    (60,353
    )
    
    (274,082
    )Redemption
      of tranche A warrants
    
    
    
    
    (8,365
    )Dividends
    
    (310,742
    )
    
    Exercise
      of stock options
    
    307
    
    
    Acquisition
      of treasury stock
    
    (86
    )
    
    Net
      cash used for discontinued operations
    
    
    (11,532
    )Net
      cash provided by (used for) financing activities
    
    33,707
    
    
    (270,325
    )Effect of
      exchange rate changes on cash
    
    (140
    )
    
    112Increase
      in cash and cash equivalents
    
    1,479
    
    
    24,101Cash and
      cash equivalents at beginning of period
    
    9,826
    
    
    26,646Cash and
      cash equivalents at end of period
    $
    11,305
    
    $
    50,747Supplemental
      information:Cash
      paid (refunded) for income taxes
    $
    (2,343
    )
    $
    7,949Cash
      paid for interest
    $
    12,083
    
    $
    8,375*Acquisition
      of business net of cash acquired:Working
      capital, other than cash
    $
    
    
    $
    (2,489
    )Property,
      plant and equipment
    
    
    
    
    (4,177
    )Other
      assets
    
    
    
    
    (393
    )Noncurrent
      liabilities
    
    
    
    
    3,410Cash
      used to acquire business
    $
    
    
    $
    (3,649
    )See the accompanying notes to the consolidated financial statements.
-3-
GENTEK INC.CONSOLIDATED STATEMENT OF CHANGES IN EQUITYFor the Nine Months Ended September 30, 2005(In thousands, except per share data)(unaudited)
Common
      Stock
    
    Unearned 
      Compensation
    
    Warrants
    
    Treasury
      Stock
    
    Accumulated
      
      Other 
      Comprehensive
      Loss
    
    Retained
      Earnings
    
    TotalBalance at
      December 31, 2004
    $
    271,690
    
    $
    (2,123
    )
    $
    8,361
    
    $
    
    
    $
    (886
    )
    $
    123,385
    
    $
    400,427Components
      of comprehensive income:Net
      income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,284
    
    
    1,284Foreign
      currency translation adjustments(net
      of tax of $(82))
    
    
    
    
    
    
    
    
    
    
    
    
    
    (126
    )
    
    
    
    
    (126
    )Change
      in unrealized loss on derivativeinstruments
      (net of tax of $89)
    
    
    
    
    
    
    
    
    
    
    
    
    
    136
    
    
    
    
    
    136Minimum
      pension liability adjustments(net
      of tax of $287)
    
    
    
    
    
    
    
    
    
    
    
    
    
    440
    
    
    
    
    
    440Comprehensive
      income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,734Long-term
      incentive plan, net
    
    (428
    )
    
    1,429
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,001Dividends
      ($31.00 per share)
    
    (190,917
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    (122,138
    )
    
    (313,055
    )Exercise
      of stock options
    
    307
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    307Purchase
      of treasury stock
    
    
    
    
    
    
    
    
    
    
    (86
    )
    
    
    
    
    
    
    
    (86
    )Balance at
      September 30, 2005
    $
    80,652
    
    $
    (694
    )
    $
    8,361
    
    $
    (86
    )
    $
    (436
    )
    $
    2,531
    
    $
    90,328See the accompanying notes to the consolidated financial statements.
-4-
GENTEK INC.NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS(Dollars in thousands, except per share data)(unaudited)
Note 1  Basis of Presentation
The accompanying unaudited consolidated financial statements have been prepared by the Company pursuant
to the rules and regulations of the Securities and Exchange Commission. In the opinion of management,
all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation
have been included. Operating results for the nine months ended September 30, 2005 are not indicative
of the results that may be expected for the year ending December 31, 2005. These statements should
be read in conjunction with the financial statements and the notes thereto included in the Companys
Annual Report on Form 10-K for the year ended December 31, 2004.
On May 18, 2004, the Company sold its KRONE communications business to ADC Telecommunications, Inc.
and recognized a gain of $185,044. Accordingly, the business has been classified as discontinued
operations. See Note 11.
On June 30, 2004, the Company acquired a wire harness and subassembly manufacturing facility located
in Reynosa, Mexico from Whirlpool Corporation for $8,400. As part of the transaction, the Company
entered into a seven-year supply agreement to supply wire harnesses, panel assemblies, copper tubing
and related components to Whirlpools North American appliance production facilities. The results
of operations of the facility have been included in the financial statements beginning July 1, 2004.
The pro forma impact of the acquisition on financial position, net income and earnings per share
is not material. Revenues from the supply agreement were $41,362 and $40,059 for the three-month
periods ended September 30, 2005 and 2004, respectively, and $120,158 for the nine-month period ended
September 30, 2005.
On December 27, 2004, the Company paid a special dividend of $7.00 per common share, totaling approximately
$70,690, which was funded primarily from excess cash generated from the sale of the Companys
KRONE communications business.
On February 28, 2005, the Companys board of directors declared a special dividend of $31.00 per
common share which was paid on March 16, 2005. Also, on February 28, 2005, GenTek closed on a secured
financing consisting of $370,000 of term loans and a $60,000 revolving credit facility. In connection
with the closing of the new financing, the Company recorded a charge in interest expense of $3,030
to write-off deferred financing costs of its then-existing debt facility which was terminated.
During the second quarter of 2005, the Company ceased operations of its printing plate business. Accordingly,
this business has been classified as discontinued operations. See Note 11.
Note 2  Summary of Significant Accounting Policies
Compensation cost for stock-based employee compensation plans is recognized using the intrinsic value
method. The following table illustrates the effect on net income (loss) and net income (loss) per
share if the Company had applied the fair value based method to recognize stock-based employee compensation.
-5-
GENTEK INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
(Dollars in thousands, except per share data)(unaudited)
Three Months Ended
      September 30,
    
    Nine Months Ended
      September 30,2005
    
    2004
    
    2005
    
    2004Net income (loss) as reported
    
    $
    1,335
    
    $
    (5,293
    )
    $
    1,284
    
    $
    194,630Deduct: Total stock-based employee
   compensation expense determined under
   fair value based method for all awards,
   net of related tax effects
    
    
    (57
    )
    
    (99
    )
    
    (235
    )
    
    (198
    )Pro forma net income (loss)
    
    $
    1,278
    
    $
    (5,392
    )
    $
    1,049
    
    $
    194,432Income (loss) per share:Basic  as reported
    
    $
    0.13
    
    $
    (0.53
    )
    $
    0.13
    
    $
    19.46Basic  pro forma
    
    $
    0.13
    
    $
    (0.54
    )
    $
    0.10
    
    $
    19.44Diluted  as reported
    
    $
    0.13
    
    $
    (0.53
    )
    $
    0.13
    
    $
    19.45Diluted  pro forma
    
    $
    0.13
    
    $
    (0.54
    )
    $
    0.10
    
    $
    19.43For purposes of this calculation, the fair value of each option grant was estimated on the grant date
using the Black-Scholes option-pricing model with the following weighted-average assumptions:
2005
    
    2004Dividend yield
    
    
    
    
    
    Expected volatility
    
    
    22
    %
    
    50
    %Risk-free interest rate
    
    
    3.93
    %
    
    2.32
    %Expected holding period (in years)
    
    
    4
    
    
    4Weighted average fair value
    
    $
    2.89
    
    $
    14.82Certain
prior-period amounts have been reclassified to conform with the current presentation.
In
December 2004, the FASB issued SFAS No. 123R, Share-Based Payment (Revised 2004). This
statement addresses the accounting for share-based payment transactions in which a company receives
employee services in exchange for the companys equity instruments or liabilities that are based
on the fair value of the companys equity securities or may be settled by the issuance of these
securities. SFAS No. 123R eliminates the ability to account for share-based compensation using the
intrinsic value method and generally requires that such transactions be accounted for using a fair
value method. In April 2005, the Securities and Exchange Commission adopted a final rule amending
the effective date. The provisions of this statement are effective for financial statements issued
for the first interim period of the first fiscal year beginning after June 15, 2005. The Company
has yet to determine a transition method to adopt SFAS 123R or which valuation method to use. The
full impact that the adoption of this statement will have on the Companys financial statements
will be determined by share-based payments granted in future periods, the transition method and valuation model used.
Note 3  Comprehensive Income (Loss)
Total comprehensive income (loss) is comprised of net income (loss), foreign currency translation adjustments
and the change in unrealized gains and losses on derivative financial instruments. Total comprehensive
income (loss) for the three months ended September 30, 2005 and 2004 was $1,955 and
-6-
GENTEK INC.NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)(Dollars in thousands, except per share data)(unaudited)
$(5,062), respectively. Total comprehensive income (loss) for the nine months ended September 30, 2005
and 2004 was $1,734 and $193,807, respectively.
Note 4  Earnings Per Share
The computation of basic earnings per share is based on the weighted average number of common shares
outstanding during the period. The computation of diluted earnings per share assumes the foregoing
and, in addition, the exercise of all warrants, stock options and restricted stock, using the treasury
stock method.
The shares outstanding used for basic and diluted earnings per common share are reconciled as follows:
Three Months Ended
      September 30,
    
    Nine Months Ended
      September 30,2005
    
    2004
    
    2005
    
    2004Basic earnings per common share:Weighted average common shares
            outstanding
    
    
    10,048,193
    
    
    10,000,000
    
    
    10,024,771
    
    
    10,000,000Diluted earnings per common share:Weighted average common shares
            outstanding
    
    
    10,048,193
    
    
    10,000,000
    
    
    10,024,771
    
    
    10,000,000Warrants, options and restricted stock
    
    
    60,462
    
    
    
    
    
    61,049
    
    
    4,939Total
    
    
    10,108,655
    
    
    10,000,000
    
    
    10,085,820
    
    
    10,004,939For the three months ended September 30, 2005 and 2004, potentially dilutive securities totaling 2,993,210
and 1,234,134, respectively, were not included in the computation of diluted earnings per common
share due to their antidilutive effect. For the nine months ended September 30, 2005 and 2004, potentially
dilutive securities totaling 3,051,736 and 1,140,819, respectively, were not included in the computation
of diluted earnings per common share due to their antidilutive effect.
Note 5  Inventories
September 30,
      2005
    
    December 31,
      2004Raw materials
    
    $
    33,010
    
    $
    32,394Work in process
    
    
    9,000
    
    
    9,630Finished products
    
    
    34,149
    
    
    32,493Supplies and containers
    
    
    939
    
    
    1,657$
    77,098
    
    $
    76,174-7-
GENTEK INC.NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)(Dollars in thousands, except per share data)(unaudited)
Note 6  Long-Term Debt
Maturities
    
    September 30,
      2005
    
    December 31,
      2004$60,000 revolving credit facility  floating rates
    
    
    2010
    
    $
    
    
    $
    First lien term loan  floating rates
    
    
    2011
    
    
    227,840
    
    
    Second lien term loan  floating rates
    
    
    2012
    
    
    135,000
    
    
    $125,000 revolving credit facility  floating rates
    
    
    2008
    
    
    
    
    
    6,500Other debt  various
    
    
    2005-2018
    
    
    4,865
    
    
    6,036Total debt
    
    
    
    
    
    367,705
    
    
    12,536Less: Current portion
    
    
    
    
    
    4,101
    
    
    1,489Net long-term debt
    
    
    
    
    $
    363,604
    
    $
    11,047On February 28, 2005, the Company closed on a secured financing consisting of $370,000 of term loans
and a $60,000 revolving credit facility (the Credit Facilities). The term loans include
a $235,000 first lien loan due on February 28, 2011 with an interest rate of LIBOR plus 2.75 percent
or base rate plus 1.75 percent, subject to a rate reduction of 0.25 percent if such term loan is
rated B1 or better by Moodys Investor Services, Inc. and a $135,000 second lien loan due on
February 28, 2012 with an interest rate of LIBOR plus 5.75 percent or base rate plus 4.75 percent.
The $60,000 revolving credit facility matures on February 28, 2010 and carries an interest rate of
LIBOR plus 2.75 percent or base rate plus 1.75 percent, subject to rate reductions under a pricing
grid if the Companys leverage ratio decreases. The first lien term loan is subject to amortization
of $2,290 per year for five years, with the remainder payable over the sixth year. There is no amortization
over the term of the second lien loan. The Credit Facilities are secured by liens on substantially
all of the personal property and certain real property of the Company and its domestic subsidiaries.
The Credit Facilities contain covenants which impose certain restrictions on the Companys ability
to, among other things, incur additional debt, pay dividends, make investments or sell assets. A
portion of excess cash flow, as defined in the Credit Facilities, and certain non-recurring cash
inflows such as proceeds from asset sales, insurance recoveries, and equity offerings must be used
to pay down indebtedness and may not be reborrowed. In addition, the Credit Facilities contain certain
financial covenants which include a maximum leverage ratio, minimum interest coverage ratio and maximum
annual capital expenditures.
In conjunction with securing the Credit Facilities, all amounts outstanding under the Companys
$125,000 revolving credit facility were repaid and the underlying credit agreement was terminated.
Note 7  Capital Stock
The Company has the following warrants outstanding:
September 30, 2005
    
    December 31, 2004Expiration Date
    
    Number of 
      shares covered
    
    Exercise Price
    
    Number of 
      shares covered
    
    Exercise PriceTranche B
    
    
    November 10, 2008
    
    
    1,998,129
    
    $
    19.98
    
    
    717,531
    
    $
    55.65Tranche C
    
    
    November 10, 2010
    
    
    975,828
    
    $
    22.03
    
    
    350,442
    
    $
    61.35-8-
GENTEK INC.NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)(Dollars in thousands, except per share data)(unaudited)
The
  terms of the warrants provide for the number of shares covered by the warrants
  and the exercise prices to be adjusted in the case of certain events, including
  certain dividends. During March 2005, the Company paid a special dividend of
  $31.00 per share, and the number of shares covered by the warrants and their
  exercise prices were adjusted pursuant to their terms.
During 2005, 18 shares of common stock were issued upon the exercise of Tranche C warrants.
ACP Acquisition, LLC, a Delaware limited liability company, Abrams Capital, LLC, a Delaware limited
liability company, and Great Hollow Partners, LLC, a Delaware limited liability company (together,
the Purchaser), have commenced a tender offer to purchase all of the outstanding Tranche
B Warrants and all of the outstanding Tranche C Warrants at a purchase price of $4.25 per Tranche
B Warrant and $4.75 per Tranche C Warrant on the terms and conditions set forth on Schedule TO filed
by the Purchaser with the Securities and Exchange Commission on October 17, 2005 and Schedule TO/A
filed with the Securities and Exchange Commission on November 1, 2005 (jointly, the Schedule
TO) and upon the terms and subject to the conditions set forth in the Offer to Purchase dated
October 17, 2005. As set forth in Schedule 14D-9 filed with the Securities and Exchange Commission
on October 26, 2005 and Schedule 14D-9A filed with the Securities and Exchange Commission on November
2, 2005, the Company expressed no opinion and remained neutral toward the tender offer.
Note 8  Segment Information
The Company has changed the name of the former performance products segment to performance
chemicals, to more appropriately describe this segments business. Industry segment information
is summarized as follows:
Three Months Ended
      September 30,
    
    Nine Months Ended 
      September 30,2005
    
    2004
    
    2005
    
    2004Net RevenuesManufacturing
    
    $
    147,266
    
    $
    144,174
    
    $
    435,491
    
    $
    374,643Performance chemicals
    
    
    90,255
    
    
    83,963
    
    
    250,878
    
    
    241,143Consolidated
    
    $
    237,521
    
    $
    228,137
    
    $
    686,369
    
    $
    615,786Three Months Ended
      September 30,
    
    Nine Months Ended 
      September 30,2005
    
    2004
    
    2005
    
    2004Operating Profit (Loss)Manufacturing
    
    $
    769
    
    $
    4,683
    
    $
    7,524
    
    $
    20,369Performance chemicals
    
    
    7,669
    
    
    6,354
    
    
    23,111
    
    
    17,549Corporate
    
    
    (619
    )
    
    (1,128
    )
    
    (5,294
    )
    
    (5,322
    )Consolidated
    
    
    7,819
    
    
    9,909
    
    
    25,341
    
    
    32,596Interest expense
    
    
    7,952
    
    
    686
    
    
    20,767
    
    
    7,811Other (income) expense, net
    
    
    (4,198
    )
    
    12,211
    
    
    (2,995
    )
    
    10,974Consolidated income (loss) fromcontinuing operations beforeincome taxes
    
    $
    4,065
    
    $
    (2,988
    )
    $
    7,569
    
    $
    13,811-9-
GENTEK INC.NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)(Dollars in thousands, except per share data)(unaudited)
Three Months Ended
      September 30,
    
    Nine Months Ended 
      September 30,2005
    
    2004
    
    2005
    
    2004Capital ExpendituresManufacturing
    
    $
    2,102
    
    $
    3,503
    
    $
    8,325
    
    $
    6,550Performance chemicals
    
    
    4,490
    
    
    2,744
    
    
    12,396
    
    
    10,004Consolidated
    
    $
    6,592
    
    $
    6,247
    
    $
    20,721
    
    $
    16,554Three Months Ended
      September 30,
    
    Nine Months Ended 
      September 30,2005
    
    2004
    
    2005
    
    2004Depreciation and AmortizationManufacturing

    
    $
    6,134
    
    $
    7,076
    
    $
    19,855
    
    $
    19,589Performance chemicals
    
    
    4,395
    
    
    6,381
    
    
    13,076
    
    
    14,882Corporate
    
    
    429
    
    
    191
    
    
    1,135
    
    
    538Consolidated
    
    $
    10,958
    
    $
    13,648
    
    $
    34,066
    
    $
    35,009September 30,
      2005
    
    December 31, 
      2004Identifiable AssetsManufacturing
    
    
    
    
    
    
    
    $
    461,315
    
    $
    453,906Performance chemicals(1)
    
    
    
    
    
    
    
    
    275,139
    
    
    274,193Assets held for sale
    
    
    
    
    
    
    
    
    2,117
    
    
    2,868Corporate
    
    
    
    
    
    
    
    
    28,892
    
    
    22,659Consolidated
    
    
    
    
    
    
    
    $
    767,463
    
    $
    753,626(1)   Includes equity method investments of $ 265 and $339, respectively.
Note 9  Restructuring and Impairment Charges
During the first nine months of 2005, the Company initiated actions to close two manufacturing facilities
and an administrative office in its manufacturing segment. In addition, the Company initiated a workforce
reduction affecting corporate and performance chemicals employees. The Company expects to substantially
complete implementation of these restructuring actions by the end of 2005. The following tables summarize
the Companys expected costs and accruals for these restructuring actions along with restructuring
actions initiated in prior years:
-10-
GENTEK INC.NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)(Dollars in thousands, except per share data)(unaudited)
Manufacturing
    
    Performance
      Chemicals
    
    Corporate
    
    TotalEmployee Termination CostsCosts incurred in prior periods
    
    $
    1,265
    
    $
    8,365
    
    $
    132
    
    $
    9,762Costs incurred in current period
    
    
    1,384
    
    
    164
    
    
    2,038
    
    
    3,586Costs anticipated to be incurred in the future
    
    
    191
    
    
    
    
    
    
    
    
    191Total costs expected to be incurred
    
    $
    2,840
    
    $
    8,529
    
    $
    2,170
    
    $
    13,539Accrual balance at December 31, 2004
    
    $
    207
    
    $
    944
    
    $
    116
    
    $
    1,267Provisions
    
    
    1,384
    
    
    164
    
    
    2,038
    
    
    3,586Amounts paid
    
    
    (1,031
    )
    
    (1,002
    )
    
    (1,234
    )
    
    (3,267
    )Accrual balance at September 30, 2005
    
    $
    560
    
    $
    106
    
    $
    920
    
    $
    1,586Manufacturing
    
    Performance
      Chemicals
    
    Corporate
    
    TotalFacility Exit CostsCosts incurred in prior periods
    
    $
    430
    
    $
    14,253
    
    $
    
    
    $
    14,683Costs incurred in current period
    
    
    1,238
    
    
    1,303
    
    
    
    
    
    2,541Costs anticipated to be incurred in the future
    
    
    71
    
    
    490
    
    
    
    
    
    561Total costs expected to be incurred
    
    $
    1,739
    
    $
    16,046
    
    $
    
    
    $
    17,785Accrual balance at December 31, 2004
    
    $
    
    
    $
    843
    
    $
    
    
    $
    843Provisions
    
    
    1,238
    
    
    1,303
    
    
    
    
    
    2,541Amounts paid
    
    
    (996
    )
    
    (2,146
    )
    
    
    
    
    (3,142
    )Accrual balance at September 30, 2005
    
    $
    242
    
    $
    
    
    $
    
    
    $
    242Impairment Charges
During
  July 2005, the Company closed a facility in Cleveland, Ohio, which is included
  in the performance chemicals segment. Accordingly, the long-lived assets at
  the facility were assessed for impairment. Based on the results of this assessment,
  the Company recorded a non-cash impairment charge of $758 to reduce the fixed
  assets at this facility to fair value, which was determined based on a number
  of factors, including an analysis of market transactions for similar assets.
During
  August 2005, the Company closed a facility in Guelph, Ontario, Canada, which
  is included in the manufacturing segment. Accordingly, the long-lived assets
  at the facility were assessed for impairment. Based on the results of the assessment,
  the Company recorded a non-cash impairment charge of $642 to reduce the fixed
  assets at this facility to fair value, which was determined based upon market
  prices for similar assets.
-11-
GENTEK INC.NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Continued)(Dollars in thousands, except per share data)(unaudited)
Note 10  Pension and Other Postretirement Benefits
Three Months Ended
      September 30,
    
    Nine Months Ended
      September 30,2005
    
    2004
    
    2005
    
    2004Pension BenefitsService cost
    
    $
    400
    
    $
    505
    
    $
    1,201
    
    $
    2,285Interest cost
    
    
    3,191
    
    
    3,153
    
    
    9,568
    
    
    9,651Expected return on plan assets
    
    
    (3,472
    )
    
    (2,907
    )
    
    (10,409
    )
    
    (8,453
    )Amortization of net:Prior service cost
    
    
    19
    
    
    
    
    
    56
    
    
    Net periodic benefit cost
    
    $
    138
    
    $
    751
    
    $
    416
    
    $
    3,483Three Months Ended
      September 30,
    
    Nine Months Ended
      September 30,2005
    
    2004
    
    2005
    
    2004Other Postretirement BenefitsService cost
    
    $
    262
    
    $
    231
    
    $
    788
    
    $
    958Interest cost
    
    
    588
    
    
    697
    
    
    1,962
    
    
    2,878Expected return on plan assets
    
    
    
    
    
    
    
    
    
    
    
    Amortization of net:Prior service cost
    
    
    (1,085
    )
    
    (683
    )
    
    (2,586
    )
    
    (683
    )Gain
    
    
    (2
    )
    
    (81
    )
    
    (66
    )
    
    (81
    )Net periodic benefit cost (income)
    
    $
    (237
    )
    $
    164
    
    $
    98
    
    $
    3,072During the first quarter of 2004, the Company notified its employees that benefit accruals in defined
benefit pension plans covering domestic salaried and certain hourly employees would be frozen effective
April 1, 2004. This action resulted in a curtailment gain of $13,414. During the second quarter of
2004, the Company accrued $1,130 of contractual termination pension benefits, related to the closure
of a plant, which was recorded as a component of restructuring and impairment charges.
Effective
June 1, 2005, the Company implemented plan amendments to one of its postretirement medical plans
which cap the Companys cost for providing these benefits at current levels. The effect of these
changes was a reduction to the accumulated postretirement benefit obligation of $7,730 which will
be amortized as a component of net periodic postretirement benefit cost over the average remaining
service period until full eligibility of active plan participants.
On
August 31, 2005, the Company terminated and settled its two pension plans in Ireland, which resulted
in a settlement loss of $626.
During
the first nine months of 2005, the Company contributed $37,380 to its pension plan trusts and expects
to make additional contributions to foreign pension plans of approximately $100 during the remainder
of 2005.
-12-
GENTEK INC.NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - (Concluded)(Dollars in thousands, except per share data)(unaudited)
Note 11  Discontinued Operations
On May 18, 2004, the Company sold its KRONE communications business. The transaction resulted in a
gain of $185,044, net of a tax provision of $81,115 of which $5,560 represents the current or cash
portion and $75,555 represents the deferred portion. The net gain is included in income from discontinued
operations.
During the second quarter of 2005, the Company ceased operations of its printing plate business. The
business had become unprofitable as it has experienced severe competitive pressures over the last
several years and has been hurt by a continued shift in technology in the printing plate market.
Assets held for sale represents property, plant and equipment of this business and other idle property,
plant and equipment.
The
businesses included in discontinued operations had revenues of $0 and $3,156 and pretax profit (loss)
of $(642) and $(779) for the three months ended September 30, 2005 and 2004, respectively, and revenues
of $4,007 and $140,985 and pretax profit (loss) of $(3,658) and $10,680 for the nine months ended
September 30, 2005 and 2004, respectively. The businesses were formerly reported as part of the communications
segment, which is no longer a reportable segment as a result of the reclassification of these businesses
to discontinued operations.
-13-
Item 2.  Managements Discussion and Analysis of Financial Condition and Results of Operations.
This Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The Companys actual results
could differ materially from those set forth in the forward-looking statements. Certain factors that
might cause such a difference include those discussed in the section entitled, Managements
Discussion and Analysis of Financial Condition and Results of Operations  Forward-Looking Statements
contained in the Companys Annual Report on Form 10-K for the year ended December 31, 2004.
Overview
We are a holding company whose subsidiaries manufacture industrial components and performance chemicals.
We operate through two primary business segments: manufacturing and performance chemicals. Our products
are frequently highly engineered and are important components of, or provide critical attributes
to, our customers end products or operations. We operate over 60 manufacturing and production
facilities located primarily in the U.S., Canada, Mexico and India. GenTek has no independent operations
and, therefore, is dependent upon cash flow from its subsidiaries to meet its obligations.
During the first quarter of 2004, the Company notified its employees that benefit accruals in defined
benefit pension plans covering domestic salaried and certain hourly employees would be frozen effective
April 1, 2004. As a result, a curtailment gain of approximately $13 million was recognized during
the first quarter of 2004.
On May 18, 2004 the Company sold its KRONE communications business to ADC Telecommunications, Inc.
Accordingly, all financial information included herein has been reclassified to reflect the KRONE
communications business as discontinued operations. Net proceeds from the transaction of approximately
$291 million were used to repay the Companys then-outstanding Senior Term Loan Agreement in
full, and the related loan agreement was terminated. Consummation of this transaction triggered the
contingent redemption feature of the Companys tranche A warrants. The Company made the required
payment of $8.4 million ($7.13 per warrant) on June 30, 2004, and the tranche A warrants expired.
On
  June 30, 2004, the Company acquired a wire harness and subassembly manufacturing
  facility located in Reynosa, Mexico from Whirlpool Corporation for $8.4 million.
  As part of the transaction, the Company entered into a seven-year supply agreement
  to supply wire harnesses, panel assemblies, copper tubing and related components
  to Whirlpools North American appliance production facilities. The results
  of operations of the facility have been included in the financial statements
  beginning July 1, 2004. Revenues from the supply agreement were $41 million
  and $40 million for the three-month periods ended September 30, 2005 and 2004,
  respectively, and $120 million for the nine-month period ended September 30,
  2005.
On December 27, 2004, the Company paid a special dividend of $7.00 per common share, totaling approximately
$71 million, which was funded primarily from excess cash generated from the sale of the Companys
KRONE communications business.
On February 28, 2005, the Companys board of directors declared a special dividend of $31.00 per
common share which was paid on March 16, 2005. Also, on February 28, 2005, GenTek closed on a secured
financing consisting of $370 million of term loans and a $60 million revolving credit facility. The
Company used approximately $311 million, which is net of $2 million of dividends remaining to be
-14-
paid, of the financing proceeds to pay the special dividend and $35 million of the proceeds to pre-fund
certain defined benefit pension obligations. The remainder of the proceeds were used to pay transaction
fees, to refinance existing debt and for general corporate purposes. In connection with the closing
of the new financing, the Company recorded a charge in interest expense of approximately $3 million
to write-off deferred financing costs of its then-existing debt facility. The payment of the two
special dividends and the closing on the financing reflect the completion of a recapitalization of
the Company. The two dividends provided substantial value to holders of the Companys common
stock. In addition, the Company believes these actions established a more appropriate capital structure
for GenTek that allows the Company to continue to invest in its core businesses. Prior to the recapitalization,
the Companys balance sheet was substantially debt-free. By leveraging the Company, GenTek believes
it has better positioned the Company to realize increased returns for its shareholders.
During the second quarter of 2005, the Company ceased operations of its printing plate business. The
business had become unprofitable as it has experienced severe competitive pressures over the last
several years and has been hurt by a continued shift in technology in the printing plate market.
Accordingly, all financial information included herein has been reclassified to reflect the business
as discontinued operations.
During the third quarter of 2005, the Company recorded a charge of $0.6 million for a receivable write-off
driven by the bankruptcy filing of Delphi Corporation. The Company does not expect that its ongoing
business with Delphi will be materially affected by the bankruptcy filing.
Results of Operations
The following table sets forth certain line items from our Consolidated Statements of Operations for
the three and nine month periods ended September 30, 2005 and 2004 and the corresponding percentage
of net revenues for the relevant periods presented as a percentage of revenue for the periods indicated.
Three Months Ended
      September 30,
    
    Nine Months Ended
      September 30,2005
    
    2004
    
    2005
    
    2004(Dollars in millions)
    
    (Dollars in millions)Net revenues
    
    $
    237.5
    
    
    100
    %
    $
    228.1
    
    
    100
    %
    $
    686.4
    
    
    100
    %
    $
    615.8
    
    
    100
    %Cost of sales
    
    
    208.0
    
    
    88
    
    
    196.1
    
    
    86
    
    
    595.7
    
    
    87
    
    
    525.2
    
    
    85Selling, general and
  administrative expense
    
    
    18.0
    
    
    8
    
    
    19.8
    
    
    9
    
    
    57.2
    
    
    8
    
    
    62.1
    
    
    10Restructuring and impairment
  charges
    
    
    3.1
    
    
    1
    
    
    2.3
    
    
    1
    
    
    7.5
    
    
    1
    
    
    9.3
    
    
    2Pension curtailment and
  settlement (gains) losses
    
    
    0.6
    
    
    
    
    
    
    
    
    
    
    
    0.6
    
    
    
    
    
    (13.4
    )
    
    2Operating profit
    
    
    7.8
    
    
    3
    
    
    9.9
    
    
    4
    
    
    25.3
    
    
    4
    
    
    32.6
    
    
    5Interest expense
    
    
    8.0
    
    
    3
    
    
    0.7
    
    
    
    
    
    20.8
    
    
    3
    
    
    7.8
    
    
    1Interest income
    
    
    0.2
    
    
    
    
    
    0.2
    
    
    
    
    
    0.4
    
    
    
    
    
    0.4
    
    
    Other (income) expense, net
    
    
    (4.0
    )
    
    (2
    )
    
    12.4
    
    
    6
    
    
    (2.6
    )
    
    
    
    
    11.4
    
    
    2Income tax provision
    
    
    2.3
    
    
    1
    
    
    0.8
    
    
    
    
    
    4.1
    
    
    1
    
    
    8.7
    
    
    1Income (loss) from
      continuing operations
    
    
    1.7
    
    
    1
    
    
    (3.8
    )
    
    (2
    )
    
    3.5
    
    
    
    
    
    5.1
    
    
    1Income (loss) from
  discontinued operations
    
    
    (0.4
    )
    
    
    
    
    (1.5
    )
    
    
    
    
    (2.2
    )
    
    
    
    
    189.5
    
    
    31Net income (loss)
    
    $
    1.3
    
    
    1
    %
    $
    (5.3
    )
    
    (2
    )%
    $
    1.3
    
    
    
    %
    $
    194.6
    
    
    32
    %-15-
Three Months Ended September 30, 2005 Compared with Three Months Ended September 30, 2004
Net
  revenues were $238 million for the three-month period ended September 30, 2005
  as compared with $228 million for the prior year. This increase is due to higher
  sales in the manufacturing and performance chemical segments of $3 million and
  $6 million, respectively. The increase in revenues in the manufacturing segment
  was driven by both higher volumes and increased copper pricing pass through
  in the industrial wire business, partially offset by the impact of lower volumes
  from the Companys North American automotive customer base. The increased
  revenues in the performance chemicals segment was due principally to higher
  volumes and improved pricing in the Companys water chemicals business.
Gross
  profit was $30 million for the three-month period ended September 30, 2005 as
  compared with $32 million for the prior year. This decrease is principally due
  to lower gross profit in the manufacturing segment of $3 million, partially
  offset by higher gross profit in the performance chemicals segment of $1 million.
  In the manufacturing segment, the decline in gross profit is due to the impact
  of lower automotive volumes and higher raw material costs. The increase in performance
  chemicals gross profit is principally due to higher volumes in the water chemical
  product line as well as improved pass through of previously incurred higher
  raw material costs in the Companys personal care business partially offset
  by a charge of $1.7 million for environmental costs.
Selling, general and administrative expense was $18 million for the three-month period ended September
30, 2005 as compared with $20 million for the prior year. This decrease is primarily attributable
to the Companys cost reduction efforts and lower pension and other postretirement benefits
expense.
Restructuring and impairment charges were $3 million for the three-month period ended September 30,
2005 as compared with $2 million being recorded during the third quarter of 2004. The charges recorded
in 2005 are associated with the closure of a production facility as well as the Companys Southfield,
Michigan office, and continuing costs from activities initiated during 2004 and the first half of
2005.
Operating profit was $8 million for the three-month period ended September 30, 2005 as compared with
an operating profit of $10 million for the prior year. This decrease was principally due to the impact
of the above mentioned decrease in gross profit and higher restructuring costs, partially offset
by reduced selling, general and administrative costs.
Interest expense was $8 million for the three-month period ended September 30, 2005 as compared with
$1 million for the three-month period ended September 30, 2004 principally due to higher outstanding
debt balances.
Included in other (income) expense, net for the three month period ended September 30, 2005 is an unrealized
gain of $3 million relating to the Companys interest rate collar agreements and, for the three
months ended September 30, 2004, an impairment charge of $13 million related to the sale of the Companys
50% interest in the PrettlNoma Systems joint venture.
The
loss from discontinued operations was $0.4 million for the three-month period ended September 30,
2005 as compared with $2 million for the three-month period ended September 30, 2004, reflecting
the impact of the Companys printing plate business, which ceased operations in the second quarter
of 2005.
-16-
Nine Months Ended September 30, 2005 Compared with Nine Months Ended September 30, 2004
Net revenues for the nine-month period ended September 30, 2005 were $686 million as compared with
$616 million for the nine-month period ended September 30, 2004. This increase is due primarily to
higher sales in the manufacturing segment. This increase in revenues is the result of higher sales
to the appliance and electronics market of $67 million, offset by lower sales to the Companys
North American automotive customer base. The increased volume in the appliance and electronics market
is primarily the result of the Companys acquisition of a wire harness and subassembly manufacturing
facility in Reynosa, Mexico on June 30, 2004. An increase of $9 million in revenues in the performance
chemicals segment was driven by higher sales of $16 million for the Companys water chemical
product line and $4 million for the Companys personal care product lines, due to the impact
of the pass through of higher raw material prices and higher volumes in both of those businesses,
partially offset by lost revenues of $10 million attributable to closed facilities.
Gross profit was $91 million for the nine-month period ended September 30, 2005, which is unchanged
from the prior-year period. Higher gross profit of $9 million in the performance chemicals segment
was offset by lower gross profit in the manufacturing segment. The increase in the performance chemicals
segment gross profit is attributable to an insurance recovery of $3 million related to the Companys
closed Delaware Valley Works South Plant, the increased volumes and pass through of raw material
costs discussed above, as well as plant cost savings net of lost revenue of $2 million due to the
closure of the North Plant of the Delaware Valley Works in January 2005. The decrease in gross profit
in the manufacturing segment is principally due to lower sales to the Companys North American
automotive customer base and higher raw material costs. Gross profit as a percentage of sales decreased
because of the preceding factors along with the incremental revenues related to the Reynosa transaction
which generates lower than historical gross margins.
Selling, general and administrative expense was $57 million for the nine-month period ended September
30, 2005 as compared with $62 million in the prior year. This reduction is primarily attributable
to the Companys cost reduction efforts and lower pension and other postretirement benefits
expense, partially offset by a $2 million charge relating to the former Chief Executive Officers
separation from the Company.
During the third quarter of 2005, the Company terminated its two defined benefit pension plans relating
to former employees of the Companys personal care chemicals manufacturing operations in Ireland,
which were closed in 2004. As a result of this action, a settlement loss of $0.6 million was recorded.
During the first quarter of 2004, the Company notified its employees that benefit accruals in defined
benefit pension plans covering domestic salaried and certain hourly employees would be frozen effective
April 1, 2004. As a result, a curtailment gain of approximately $13 million was recognized during
the nine-month period ended September 30, 2004.
Restructuring
  and impairment charges were $8 million for the nine-month period ended September
  30, 2005 as compared with charges of $9 million for the nine-month period ended
  September 30, 2004. The charges recorded in 2005 are associated with the closure
  of two production facilities, the closure of the Companys Southfield,
  Michigan office, headcount reductions and continuing costs from activities initiated
  during prior years. The charges recorded in the prior year were associated with
  the closure of four production facilities.
-17-
Operating profit was $25 million for the nine-month period ended September 30, 2005 as compared with
an operating profit of $33 million for the prior-year period. This decrease is principally due to
the non-recurring pension curtailment gain of approximately $13 million realized in 2004, partially
offset by reduced selling, general and administrative expenses and lower restructuring costs.
Interest expense was $21 million for the nine-month period ended September 30, 2005 as compared with
$8 million for the prior-year period. The increase is principally due to higher outstanding debt
balances as well as a charge of $3 million to write-off deferred financing costs for debt retired
during 2005.
Results of Operations by Segment
Three Months Ended
      September 30,
    
    Nine Months Ended
      September 30,2005
    
    
    2004
    
    
    2005
    
    2004Net Revenues
    
    (In millions)
    
    (In millions)Manufacturing
    
    $
    147.3
    
    $
    144.1
    
    $
    435.5
    
    $
    374.7Performance chemicals
    
    
    90.2
    
    
    84.0
    
    
    250.9
    
    
    241.1Total
    
    $
    237.5
    
    $
    228.1
    
    $
    686.4
    
    $
    615.8Three Months Ended
      September 30,
    
    Nine Months Ended
      September 30,2005(1)
    
    
    2004(2)
    
    
    2005(3)
    
    2004(4)Operating Profit (Loss)
    
    (In millions)
    
    (In millions)Manufacturing
    
    $
    0.8
    
    $
    4.7
    
    $
    7.5
    
    $
    20.4Performance chemicals
    
    
    7.6
    
    
    6.3
    
    
    23.1
    
    
    17.5Corporate
    
    
    (0.6
    )
    
    (1.1
    )
    
    (5.3
    )
    
    (5.3
    )Total
    
    $
    7.8
    
    $
    9.9
    
    $
    25.3
    
    $
    32.6(1)
Includes restructuring and impairment charges of $2.0 million in the manufacturing segment, $0.9 million
in the performance chemicals segment and $0.2 million in corporate and a pension settlement
loss of $0.6 million in the performance chemicals segment.(2)
Includes restructuring and impairment charges of $0.6 million in the manufacturing segment and $1.7
million in the performance chemicals segment.(3)
Includes restructuring and impairment charges of $3.3 million in the manufacturing segment, $2.4 million
in the performance chemicals segment and $1.8 million in corporate and a pension settlement loss
of $0.6 million in the performance chemicals segment.(4)
Includes restructuring and impairment charges of $1.1 million in the manufacturing segment and $8.2
million in the performance chemicals segment. Also includes pension curtailment gains of $1.7 million
in the manufacturing segment and $11.7 million in the performance chemicals segment.Three Months Ended September 30, 2005 Compared with Three Months Ended September 30, 2004
Manufacturing Segment
Net
  revenues for the manufacturing segment were $147 million for the three-month
  period ended September 30, 2005 as compared to $144 million for the comparable
  prior-year period. This increase is principally due to higher sales in the industrial
  wire market of $8 million, partially offset by lower sales in the automotive
  and appliance and electronic markets of $4 million and $1 million, respectively.
  The increase in revenues in the industrial wire market was principally attributable
  to higher volumes as well as the pass through of higher copper prices. The decrease
  in revenues in the automotive market reflects the
-18-
impact of lower
  sales volumes to the Companys North American automotive customer base.
  Gross profit was $13 million for the three-month period ended September 30,
  2005 as compared to $16 million for the comparable prior-year period due to
  the impact of lower automotive volumes and higher raw material costs, which
  we were not able to pass on to customers. Selling, general and administrative
  expense was $11 million for the three-month period ended September 30, 2005,
  which is in line with the prior-year period. Restructuring and impairment charges
  were $2 million for the three-month period ended September 30, 2005, versus
  $1 million for the prior-year period. Operating profit for the three-month period
  ended September 30, 2005 was $1 million, as compared with $5 million for prior-year
  period due to the lower gross profit and higher restructuring charges.
Performance Chemicals Segment
Net
  revenues for the performance chemicals segment were $90 million for the three-month
  period ended September 30, 2005 as compared with $84 million for the prior-year
  period. Higher sales in the water chemical, sulfur and personal care product
  lines of $6 million, $2 million and $1 million, respectively, were partially
  offset by lower sales in the Companys fine chemical product line of $3
  million. The decrease in revenues in the fine chemicals product line reflects
  the impact of the shutdown of the Companys Delaware Valley Works North
  Plant in January 2005 and the impact of the restructuring of the sulfur derivatives
  business in 2004. Gross profit was $16 million for the three-month period ended
  September 30, 2005, in line with the prior-year period. Selling, general and
  administrative expense was $8 million for the three-month period ended September
  30, 2005, as compared with $9 million for the prior-year period. Restructuring
  and impairment charges were $1 million for the three-month period ended September
  30, 2005, as compared with $2 million for the prior-year period. Operating profit
  was $8 million for the three-month period ended September 30, 2005 as compared
  to $6 million for the prior-year period. This increase is principally due to
  the abovementioned lower selling, general and administrative expense and lower
  restructuring expense in the period ending September 30, 2005.
Nine Months Ended September 30, 2005 Compared with Nine Months Ended September 30, 2004
Manufacturing Segment
Net
  revenues were $435 million for the nine-month period ended September 30, 2005
  as compared with $375 million for the prior-year period. This increase is principally
  due to higher sales in the appliance and electronics market and the industrial
  wire market of $67 million and $5 million, respectively, partially offset by
  lower sales in the automotive market of $12 million. The increase in revenues
  in the appliance and electronics market was principally driven by the acquisition
  of a wire harness and subassembly manufacturing facility in Reynosa, Mexico
  on June 30, 2004. The decrease in the automotive segment is the result of lower
  sales volume in the Companys North American automotive customer base.
  Gross profit was $43 million for the nine-month period ended September 30, 2005
  as compared with $51 million for the prior period. The decrease is principally
  due to the impact of lower automotive volumes and higher raw material costs.
  Gross profit as a percentage of sales decreased because of the preceding factors
  along with the incremental revenues related to the Reynosa transaction which
  generates lower than historical gross profit margins. Selling, general and administrative
  expense was $32 million for the nine-month period ended September 30, 2005 as
  compared to $31 million recorded in the prior-year period. This increase is
  the result of higher allocated corporate expenses due to the sale of the communications
  business and the aforementioned acquisition of a wire harness and subassembly
  manufacturing facility partially offset by the Companys cost reduction
  efforts. Restructuring and impairment charges were $3 million for the nine-month
  period ended September 30, 2005 as compared to $1 million being recorded during
  the comparable prior-year period. The increase is attributable to the closure
  of two production facilities and the Companys Southfield, Michigan office,
-19-
along with continuing
  charges related to activities begun in 2004. Operating profit for the nine-month
  period ended September 30, 2005 was $8 million as compared with $20 million
  for the comparable prior-year period. This decrease is the result of the above
  mentioned lower gross margin, higher restructuring charges and a non-recurring
  $2 million pension curtailment gain recorded in the first quarter of 2004.
Performance Chemicals Segment
Net
  revenues were $251 million for the nine-month period ended September 30, 2005
  as compared with $241 million for the comparable prior-year period. Higher sales
  in the water chemical and personal care product lines of $16 million and $4
  million, respectively, partially offset by lost sales related to closed facilities
  and businesses that the Company exited. The increase in both the water chemical
  and personal care product lines is due to the impact of the pass through of
  higher raw material prices to our customers and higher volumes. The decrease
  in revenues due to closed facilities or businesses exited by the Company reflects
  the impact of the shutdown of the Companys Delaware Valley Works North
  Plant in January 2005 and the impact of the restructuring of the sulfur derivatives
  business in 2004. Gross profit was $48 million for the nine-month period ended
  September 30, 2005 as compared with $39 million for the prior-year period. The
  increase in gross profit is principally due to the impact of the pass through
  of previously incurred higher raw material costs in the water chemical and personal
  care product lines, a previously reported insurance recovery of $3 million related
  to the Companys closed Delaware Valley Works South Plant, and cost savings
  net of lost revenue of $2 million due to the closure of the Delaware Valley
  Works North Plant. Selling, general and administrative expense was $23 million
  for the nine-month period ended September 30, 2005 as compared to $25 million
  in the prior-year period. This decrease is the result of the Companys
  cost reduction efforts, partially offset by higher allocations of corporate
  expenses due to the sale of the communications business. Restructuring and impairment
  charges were $2 million for the nine-month period ended September 30, 2005,
  while charges of $8 million were recorded in the prior-year period. Operating
  profit was $23 million for the nine-month period ended September 30, 2005 as
  compared with an operating profit of $18 million for the comparable prior-year
  period. This increase is principally due to the abovementioned gross profit
  improvement, reduced selling, general and administrative expenses and lower
  restructuring and impairment charges, partially offset by a non-recurring $12
  million pension curtailment gain recorded in 2004.
Financial Condition, Liquidity and Capital Resources
Cash and cash equivalents were $11 million at September 30, 2005, $1 million more than December 31,
2004. Significant cash flows during the nine-month period ended September 30, 2005 included cash
used by operating activities of $12 million, capital expenditures of $21 million, dividend payments
of $311 million, offset by net borrowings of $344 million. Cash used for operating activities includes
contributions made to pension plans of $37 million.
The Company had working capital of $110 million at September 30, 2005 as compared with working capital
of $97 million at December 31, 2004. This increase in working capital principally reflects higher
accounts receivable balances principally due to typical seasonal variations.
Cash payments for employee termination costs and facility exit costs totaled $6 million in the nine
months ended September 30, 2005. Management expects that cash outlays related to these actions will
be substantially completed by the end of 2006, with the exception of a lease obligation that has
payment terms extending beyond 2006. Management intends to fund these cash outlays from existing
cash balances and cash flow generated by operations.
-20-
On
February 28, 2005, the Companys board of directors declared a special dividend of $31.00 per
common share which was paid on March 16, 2005. Also, on February 28, 2005, the Company closed on
a secured financing consisting of $370 million of term loans and a $60 million revolving credit facility
(the Credit Facilities). The term loans include a $235 million first lien loan due on
February 28, 2011 with an interest rate of LIBOR plus 2.75 percent or base rate plus 1.75 percent,
subject to a rate reduction of 0.25 percent if such term loan is rated B1 or better by Moodys
Investor Services, Inc. and a $135 million second lien loan due on February 28, 2012 with an interest
rate of LIBOR plus 5.75 percent or base rate plus 4.75 percent. The $60 million revolving credit
facility matures on February 28, 2010 and carries an interest rate of LIBOR plus 2.75 percent or
base rate plus 1.75 percent, subject to rate reductions under a pricing grid if the Companys
leverage ratio decreases. The first lien term loan is subject to amortization of $2 million per year
for five years, with the remainder payable over the sixth year. There is no amortization over the
term of the second lien loan. The Company used approximately $311 million, which is net of $2 million
of dividends remaining to be paid, of the financing proceeds to pay the special dividend and $35
million of the proceeds to pre-fund certain defined benefit pension obligations. The remainder of
the proceeds were used to pay transaction fees, to refinance existing debt and for general corporate
purposes. The Credit Facilities are secured by liens on substantially all of the personal property
and certain real property of the Company and its domestic subsidiaries. The Credit Facilities contain
covenants which impose certain restrictions on the Companys ability to, among other things,
incur additional debt, pay dividends, make investments or sell assets. Additionally, a portion of
excess cash flow, as defined in the Credit Facilities, and certain non-recurring cash inflows such
as proceeds from asset sales, insurance recoveries, and equity offerings must be used to pay down
indebtedness and may not be reborrowed. In addition, the Credit Facilities contain certain financial
covenants which include a maximum leverage ratio, minimum interest coverage ratio and maximum annual
capital expenditures. At September 30, 2005, the Company was in compliance with the covenants in
the Credit Facilities. In conjunction with securing the Credit Facilities, all amounts outstanding
under the Companys then-existing $125 million revolving credit facility were repaid and the underlying credit agreement was terminated.
In April 2005, the Company entered into two no-cost interest rate collar agreements, effectively hedging
$185 million of its LIBOR-based floating rate term debt for five years. As a result of entering into
the agreements, the interest rate to be paid by the Company relating to the hedged portion of its
debt will be based on a minimum three-month LIBOR of 4.05 percent on average and a maximum three-month
LIBOR of 5.00 percent.
During the first nine months of 2005, the Company contributed $37 million to its pension plan trusts,
of which $35 million is in excess of required contribution amounts. Under current assumptions, this
accelerated funding is expected to substantially reduce the amount of any cash contributions the
Company is required to make during 2006 and 2007.
The
  Company has not entered into any off-balance sheet financing arrangements.
During the first nine months of 2005, the Company made $21 million of capital expenditures and expects
to make approximately $10 million during the remainder of the year.
At September 30, 2005 the Company had no borrowings outstanding on its revolving credit facility. During
the first nine months of 2005, the Company prepaid $6 million of its first lien term loan. During
October 2005, the Company made an additional prepayment of $3 million on its first lien term loan.
-21-
Management believes that the Companys cash flow from operations and availability under its revolving
credit facility will be sufficient to cover future debt service requirements, capital expenditures,
and working capital requirements.
Contractual Obligations
In
  conjunction with securing the Credit Facilities, all amounts outstanding under
  the Companys then-existing $125 million revolving credit facility were
  repaid and the underlying credit agreement was terminated. At December 31, 2004,
  there was $6.5 million outstanding under this facility which was included in
  the contractual obligations table in the Companys annual report on Form
  10-K under long-term debt, with payments due in 2008. At September 30, 2005,
  there was $363 million outstanding under the Credit Facilities, which require
  payments of $2 million per year for five years, with the remainder due after
  five years.
Recent Accounting Pronouncements
In December 2004, the FASB issued SFAS No. 123R, Share-Based Payment (Revised 2004). This
statement addresses the accounting for share-based payment transactions in which a company receives
employee services in exchange for the companys equity instruments or liabilities that are based
on the fair value of the companys equity securities or may be settled by the issuance of these
securities. SFAS No. 123R eliminates the ability to account for share-based compensation using the
intrinsic value method and generally requires that such transactions be accounted for using a fair
value method. In April 2005, the Securities and Exchange Commission adopted a final rule amending
the effective date. The provisions of this statement are effective for financial statements issued
for the first interim period of the first fiscal year beginning after June 15, 2005. The Company
has yet to determine a transition method to adopt SFAS 123R or which valuation method to use. The
full impact that the adoption of this statement will have on the Companys financial statements
will be determined by share-based payments granted in future periods, the transition method and valuation model used.
Item 3.   Quantitative and Qualitative Disclosures About Market Risk.
The Companys cash flows and earnings are subject to fluctuations resulting from changes in interest
rates, foreign currency exchange rates and commodity prices, and the Company selectively uses financial
instruments to manage these risks. The Companys objective in managing its exposure to changes
in interest rates, foreign currency exchange rates and commodity prices is to reduce volatility on
earnings and cash flow associated with such changes. The Company has not entered, and does not intend
to enter, into financial instruments for speculation or trading purposes.
Interest rate risk
At September 30, 2005, the Companys debt financing consisted primarily of amounts outstanding
under the Companys term loan credit facility. The Company had no borrowings under its revolving
credit facility. The borrowings outstanding under the Companys credit facility are collateralized
by substantially all of the personal property and certain real property of the Company and its domestic
subsidiaries. Borrowings under the Companys credit facility are sensitive to changes in interest
rates. Given the existing level of borrowings under the credit facility of $363 million as of September
30, 2005, a 1⁄2 percent change in the weighted-average interest rate would have an interest impact
of approximately $0.2 million each month.
-22-
Principal Balance
    Fair Value
    Weighted-Average Interest Rate at 
    September 30, 2005
    Scheduled Maturity$135 million
    $135 million
    9.35%
    February 28, 2012$228 million
    $228 million
    6.60%
    February 28, 2011In April 2005 the Company entered into two five year interest rate collar agreements in the aggregate
notional amount of $185 million, in order to hedge against the effect that further interest rate
fluctuations may have on the Companys floating rate debt. The interest rate to be paid will
be based on a minimum three-month LIBOR of 4.05 percent on average and a maximum three-month LIBOR
of 5.00 percent. These interest rate collar agreements are scheduled to mature in 2010. The fair
value of the agreements was $0.2 million at September 30, 2005.
Item 4.   Controls and Procedures.
(a) Disclosures Controls and Procedures. The Company maintains disclosure controls and procedures that
are designed to ensure that information required to be disclosed in its SEC filings is recorded,
processed, summarized and reported within the time period specified in the SECs rules and forms,
and that such information is accumulated and communicated to management, including the Chief Executive
Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required
disclosure based on the definition of disclosure controls and procedures in Rule 13a-15
(e) and 15d-15 (e) promulgated under the Exchange Act. In designing and evaluating the disclosure
controls and procedures, management recognized that any controls and procedures, no matter how well
designed and operated, can provide only reasonable assurance of achieving the desired control objectives,
and management is required to apply judgment in evaluating its controls and procedures. Management,
under the supervision and with the participation of the Chief Executive Officer and Chief Financial
Officer, conducted an evaluation of the effectiveness of the design and operation of the Companys
disclosure controls and procedures as of the end of the period covered by this report. Based on this
evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that the Companys
disclosure controls and procedures were effective as of September 30, 2005.
(b)
Changes in Internal Control Over Financial Reporting. During the quarter, the Company implemented
additional review processes in its procedures for designating and documenting derivative financial
instruments as hedges for financial accounting purposes. Additionally, during the quarter the Company
designated two interest rate collar agreements as hedges for financial accounting purposes. The designation
and related documentation were completed utilizing the revised control procedures. Accordingly, the
material weakness identified in the prior quarter with respect to the controls over this process
has been remediated.
This
improvement in internal control over financial reporting (as such term is defined in Rules 13a-15(f)
and 15d-15(f) under the Exchange Act) is the only change during the fiscal quarter to which this
report relates that has materially affected, or is reasonably likely to materially affect, the Companys
internal control over financial reporting.
-23-
PART II.   OTHER INFORMATION
Item 1.   Legal Proceedings.
This information should be read in conjunction with the Companys Annual Report on Form 10-K
for the fiscal year ended December 31, 2004.
Richmond Litigation
On
April 20, 2005 an order was entered substantially granting the Companys motion to dismiss approximately
36,000 of the original 73,000 proofs of claim. As a result of further stipulations and orders dismissing
an additional 6,000 proofs of claim, there were approximately 30,000 claims remaining at the time
that the litigation was stayed for settlement purposes (see below). There are approximately an additional
6,000 claims as to which further dismissal motions were contemplated at the time the stay went into
effect. In addition to the claims against the Company and others seeking damages allegedly arising
from chemical releases from the Companys Richmond facility in 2001, certain Richmond claimants
also commenced a class action in California State Court against third parties that the Richmond claimants
allege to have received fraudulent transfers of the Companys assets or aided in such transfers.
The Company believes that the fraudulent transfer claims and causes of action asserted in the state
law complaint are foreclosed by the Companys Plan of Reorganization and certain Bankruptcy
Court orders, including the order confirming the Plan of Reorganization. Accordingly, the Company
filed a motion with the Bankruptcy Court, which was heard May 18, 2005, seeking to enforce the Plan
of Reorganization and Bankruptcy Court orders to preclude the continued prosecution of the asserted
fraudulent transfer claims. That motion was granted in significant part in August 2005. In early
October 2005, most of the parties, through their counsel, reached an agreement in principle to settle
the case in its entirety subject to several conditions, including but not limited to the execution
of a global settlement agreement binding on all parties and court approval. In light of this agreement,
the parties further agreed to stay further activity in the case pending this settlement process and
the state court has accommodated that request, subject to reinstatement of the litigation in the
event a settlement is not consummated. There is a further status conference scheduled for November 29, 2005.
Item 2.
    Unregistered Sales of Equity Securities and Use of Proceeds.NONEItem 3.
    Defaults Upon Senior Securities.NONEItem 4.
    Submission of Matters to a Vote of Security Holders.NONEItem 5.
    Other Information.NONE-24-
Item 6.    Exhibits.
Exhibit No.
  Description2.1
Joint Plan of Reorganization Under Chapter 11, Title 11, United States Code of GenTek Inc., et al.,
and Noma Company, Debtors, dated August 28, 2003, as filed with the United States Bankruptcy Court
for the District of Delaware on August 28, 2003 (incorporated by reference to Exhibit 2.1 of the
Registrants Form 8-K, filed with the Commission on October 21, 2003).2.2
First Modification to Joint Plan of Reorganization Under Chapter 11, Title 11, United States Code of
GenTek Inc., et al., and Noma Company, Debtors, dated October 3, 2003 as filed with the United States
Bankruptcy Court for the District of Delaware on October 3, 2003 (incorporated by reference to Exhibit
2.2 of the Registrants Form 8-K, filed with the Commission on October 21, 2003).2.3
Order confirming Joint Plan of Reorganization Under Chapter 11, Title 11, United States Code of GenTek
Inc., et al., and Noma Company, Debtors, as Modified, as entered by the United States Bankruptcy
Court for the District of Delaware on October 7, 2003 (incorporated by reference to Exhibit 2.3 of
the Registrants Form 8-K, filed with the Commission on October 21, 2003).3.1
Second Amended and Restated Certificate of Incorporation of GenTek Inc., effective as of November 7,
2003 (incorporated by reference to the Registrants Form 8-A to amend its Form 10, dated November
10, 2003, as filed with the Securities and Exchange Commission).3.2
Amended and Restated By-Laws of GenTek Inc., effective as of November 10, 2003 (incorporated by reference
to the Registrants Form 8-A to amend its Form 10, dated November 10, 2003, as filed with the
Securities and Exchange Commission).4.1
GenTek Inc. Tranche B Warrant Agreement, dated as of November 10, 2003 (incorporated by reference to
the Registrants Form 8-A to amend its Form 10, dated November 10, 2003, as filed with the Securities
and Exchange Commission).4.2
GenTek Inc. Tranche C Warrant Agreement, dated as of November 10, 2003 (incorporated by reference to
the Registrants Form 8-A to amend its Form 10, dated November 10, 2003, as filed with the Securities
and Exchange Commission).10.1
Form of Registration Rights Agreement by and among the Company and the holders named therein dated
as of November 10, 2003 (incorporated by reference to the Registrants Form 8-A to amend its
Form 10, dated November 10, 2003, as filed with the Securities and Exchange Commission).10.2
GenTek Inc. 2003 Management and Directors Incentive Plan (incorporated by reference to the Registrants
Form 10-Q dated September 30, 2003, as filed with the Securities and Exchange Commission).-25-
10.3
GenTek Key Employee Retention Plan (incorporated by reference to Exhibit 10.14 to the Registrants
Form 10-K/A dated April 30, 2003, as filed with the Securities and Exchange Commission).10.4
Form of Indemnification Agreement (incorporated by reference to the Registrants Form 10-K dated
December 31, 2003, as filed with the Securities and Exchange Commission).10.5
GenTek Performance Plan (incorporated by reference to the Exhibit 10.3 to the Registrants Amendment
No. 2 to Form 10, dated April 8, 1999, as filed with the Securities and Exchange Commission).10.6
Tax Sharing Agreement between GenTek Inc. and the General Chemical Group Inc. (incorporated by reference
to the Exhibit 10.6 to the Registrants Amendment No. 2 to Form 10, dated April 8, 1999, as
filed with the Securities and Exchange Commission).10.7
Share Purchase Agreement by and among ADC Telecommunications Inc., Krone International Holding Inc.,
Krone Digital Communications Inc., GenTek Holding Corporation, and GenTek Inc., dated March 25, 2004
(incorporated by reference to Exhibit 10.14 of the Registrants Form 10-Q for the period ended
March 31, 2004, as filed with Securities and Exchange Commission).10.8
Employment Agreement with Richard R. Russell (incorporated by reference to the Registrants Form
10-Q dated June 30, 2004, as filed with the Securities and Exchange Commission).10.9
Amendment to Employment Agreement with Richard R. Russell (incorporated by reference to the Registrants
Form 10-K dated December 31, 2004, as filed with the Securities and Exchange Commission).10.10
Form of Director Restricted Stock Agreement (incorporated by reference to the Registrants Form
10-Q dated June 30, 2004, as filed with the Securities and Exchange Commission).10.11
Form of Emergence Shares Restricted Stock Agreement (incorporated by reference to the Registrants
Form 10-Q dated June 30, 2004, as filed with the Securities and Exchange Commission).10.12
Form of Restricted Stock Agreement (incorporated by reference to the Registrants Form 10-Q dated
June 30, 2004, as filed with the Securities and Exchange Commission).10.13
Form of Stock Option Agreement (incorporated by reference to the Registrants Form 10-Q dated
June 30, 2004, as filed with the Securities and Exchange Commission).10.14
Form of Performance Cash Award Agreement (incorporated by reference to the Registrants Form 10-Q
dated June 30, 2004, as filed with the Securities and Exchange Commission).-26-
10.15
Retention Agreement with Matthew R. Friel (incorporated by reference to the Registrants Form
10-Q dated September 30, 2004, as filed with the Securities and Exchange Commission).10.16
Form of Letter Agreement and Term Sheet with Matthew R. Friel (incorporated by reference to the Registrants
Form 10-Q dated September 30, 2004, as filed with the Securities and Exchange Commission).10.17
Master Settlement Agreement, dated April 30, 2004, among GenTek Holding Corporation, General Chemical
LLC, and Honeywell International Inc. (incorporated by reference to the Registrants Form 10-Q
dated September 30, 2004, as filed with the Securities and Exchange Commission).10.18
First Lien Credit and Guaranty Agreement among GenTek Inc., GenTek Holding LLC, as borrower, the other
guarantors party thereto, the lenders party thereto from time to time, Goldman Sachs Credit Partners
L.P., as joint lead arranger, General Electric Capital Corporation, as co-administrative agent, and
Bank of America, N.A., as co-administrative agent and collateral agent, dated February 28, 2005 (incorporated
by reference to the Registrants Form 10-K dated December 31, 2004, as filed with the Securities
and Exchange Commission).10.19
Second Lien Credit and Guaranty Agreement among GenTek Inc., GenTek Holding LLC, as borrower, the other
guarantors party thereto, the lenders party thereto from time to time, Goldman Sachs Credit Partners
L.P., as joint lead arranger, sole bookrunner, syndication agent, administrative agent and as collateral
agent, Bank of America Securities LLC, as joint lead arranger and Bank of America, N.A., as documentation
agent, dated February 28, 2005 (incorporated by reference to the Registrants Form 10-K dated
December 31, 2004, as filed with the Securities and Exchange Commission).10.20
Letter Agreement with Richard R. Russell, dated May 23, 2005 (incorporated by reference to the Registrants
Form 10-Q dated June 30, 2005, as filed with the Securities and Exchange Commission).10.21
Employment Agreement with William E. Redmond, Jr., dated May 23, 2005 (incorporated by reference to
the Registrants Form 10-Q dated June 30, 2005, as filed with the Securities and Exchange Commission).10.22
Employment agreement with Andrew Hines, dated September 21, 2005.10.23
Employment agreement with Maximo Vargas, dated September 22, 2005.31.1
  Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
  Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.-27-
32
Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section
1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002.-28-
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned there unto duly authorized.
GENTEK INC.RegistrantDate
    November 9, 2005
    /s/
    William E. Redmond, Jr.William E. Redmond, Jr.President and Chief Executive Officer and Director(Principal Executive Officer)Date
    November 9, 2005
    /s/
    Andrew P. HinesAndrew P. HinesVice President and Chief Financial Officer(Principal Financial and Accounting Officer)-29-