Annual Report (Form 10-K), fiscal year 1993

ITEM 1. BUSINESS
Lubrizol was organized under the laws of Ohio in 1928. The company began business as a compounder of special-purpose lubricants, and in the early 1930's was among the first to commence research in the field of lubricant additives. Today, the company is a full service supplier of performance chemicals to diverse markets worldwide. These specialty chemical products are created through the application of advanced chemical, mechanical and biological technologies to enhance the performance and quality of the customer products in which they are used. The company develops, produces and sells chemical additives for transportation and industrial lubricants and functional fluids, fuel additives and diversified specialty chemical products.
Prior to December 1, 1992, the company also had a separately reportable Agribusiness segment. That segment included traditional operations which develop, produce and market planting seeds and specialty vegetable oils, and also included strategic biotechnology research and development. As described in Note 16 to the Financial Statements (included in the company's 1993 Annual Report to its shareholders and incorporated herein by reference) on December 1, 1992, the company transferred substantially all of its Agribusiness segment, other than the specialty vegetable oil operations, to Mycogen Corporation and a joint venture partnership formed with Mycogen. The transferred assets were related to the seed business activities of the company's former Agrigenetics Division. The Agribusiness assets and operations retained by the company are not reportable as a separate industry segment after 1992.
Financial information for the industry segments, prior to December 1, 1992, is contained in Note 14 to the Financial Statements and in the table of Operating Results by Business Segment contained in Management's Discussion and Analysis on page 29 of the 1993 Annual Report to shareholders which are incorporated herein by reference.
Specialty Chemicals
PRINCIPAL PRODUCTS. The company's principal products are additive systems for gasoline and diesel engine oils, automatic transmission fluids, gear oils, industrial fluids, metalworking compounds and fuels. The company also offers other specialty chemical products. Additives for engine oils accounted for 50% of consolidated revenues in 1993, 48% in 1992, and 45% in 1991. Additives for driveline oils accounted for 19%, 18% and 19% of consolidated revenues for these respective periods.
Additives improve the lubricants and fuels used in cars, trucks, buses, off-highway equipment, marine engines and industrial applications. In lubricants, additives enable oil to withstand a broader range of temperatures, limit the buildup of sludge and varnish deposits, reduce wear, inhibit the formation of foam, rust and corrosion, and retard oxidation. In fuels, additives help maintain efficient operation of the fuel delivery system, help control deposits and corrosion, improve combustion and assist in preventing decomposition during storage.
Due to the variety in the properties and applications of oils, a number of different chemicals are used to formulate Lubrizol's products. Each additive combination is designed to fit the characteristics of the customer's base oil and the level of performance specified. Engine oils for passenger cars contain a combination of chemical additives which usually includes one or more detergents, dispersants, oxidation inhibitors and wear inhibitors, pour point depressants and viscosity improvers. Other chemical combinations are used in heavy duty engine oils for trucks and off-highway equipment and in formulations for gear oils, automatic transmission fluids, industrial oils, metalworking fluids, and gasoline, diesel and residual fuels.
COMPETITION. The chemical additive field is highly competitive in terms of price, product performance and customer service. The company's principal competitors, both in the United States and overseas, are four major petroleum companies and one chemical company. The petroleum companies produce lubricant and fuel additives for their own use, and also sell additives to others. These competing companies are also customers of Lubrizol. Excluding viscosity improvers, management believes, based on volume sold, that it is the largest supplier to the petroleum industry of performance chemicals for lubricants.
CUSTOMERS. In the United States, Lubrizol markets its additive products through its own sales organization. The company's additive customers consist primarily of oil refiners and independent oil blenders and are located in more than 100 countries. Approximately 60% of the company's sales are made to customers outside of North America. The company's ten largest customers, most of which are international oil companies and a number of which are groups of affiliated entities, accounted for approximately 44% of consolidated sales in 1993. Although the loss of any one of these customers could have a material adverse effect on the company's business, each is made up of a number of separate business units that the company believes make independent purchasing decisions with respect to chemical additives. Sales to Royal Dutch Petroleum Company (Shell) and its affiliates accounted for 9% of consolidated sales in 1993.
RAW MATERIALS. Lubrizol utilizes a broad variety of chemical raw materials in the manufacture of its additives and uses oil in processing and blending additives. These materials are obtainable from several sources, and for the most part are derived from petroleum. Historically, the unstable conditions in the Middle East have caused the cost of raw materials to fluctuate significantly; however, it has not significantly affected the availability of raw materials to the company. The company expects raw materials to be available in adequate amounts in 1994.
RESEARCH, TESTING AND DEVELOPMENT. Lubrizol has historically emphasized research and has developed a large percentage of the additives it manufactures and sells. Technological developments in the design of engines and other automotive equipment, combined with rising demands for environmental protection and fuel economy, require increasingly sophisticated chemical additives.
Research and development expenditures were $88.5 million in 1993, $76.2 million for 1992 and $63.7 million for 1991. These amounts were equivalent to 5.8%, 5.3% and 4.7% of the respective revenues for such years. These amounts include expenditures for the performance evaluation of additive developments in engines and other types of mechanical equipment as well as expenditures for the development of specialty chemicals for industrial applications. In addition, $83.0 million, $63.6 million and $64.0 million was spent in 1993, 1992 and 1991, respectively, for technical service activities, principally for evaluation in mechanical equipment of specific lubricant formulations designed for the needs of petroleum industry customers throughout the world.
The company has two research facilities at Wickliffe, Ohio, one of which is principally for lubricant additive research and the other for research in the field of other specialty chemicals. The company also maintains a mechanical testing laboratory at Wickliffe, equipped with a variety of gasoline and diesel engines and other mechanical equipment to evaluate the performance of additives for lubricants and fuels. Lubrizol has similar mechanical testing laboratories in England and Japan and, in addition, makes extensive use of independent contract research firms. Extensive field testing is also conducted through various arrangements with fleet operators and others.
Liaison offices in Detroit, Michigan; Hazelwood, England; Hamburg, Germany; Tokyo, Japan; and Paris, France maintain close contact with the principal automotive and equipment manufacturers of the world and keep the company abreast of the performance requirements for Lubrizol products in the face of changing technologies. These liaison activities also serve as contacts for cooperative development and evaluation of products for future applications. Contacts with the automotive and equipment industry are important so the company may have the necessary direction and lead time to develop products for use in engines, transmissions, gear sets, and other areas of equipment that require lubricants of advanced design.
PATENTS. Lubrizol owns certain United States patents relating to lubricant and fuel additives, lubricants, chemical compositions and processes, and protective coating materials and processes. It also owns similar patents in foreign countries. While such domestic and foreign patents expire from time to time, Lubrizol continues to apply for and obtain patent protection on an ongoing basis. Although the company believes that, in the aggregate, its patents constitute an important asset, it does not regard its business as being materially dependent upon any single patent or any group of related patents.
The company has filed claims against Exxon Corporation and its affiliates ("Exxon") alleging infringements by Exxon of certain of the company's patents. These suits are pending in the United States and in Canada, France and the United Kingdom, and are at various stages. The international suits allege infringement of patents that correspond to a United States patent admitted as valid by Exxon in a settlement in 1988. In the suit in Canada, a determination of liability has been made by the courts against Exxon and in favor of the company, and the case has been returned to the trial court for an assessment of damages. In another patent infringement suit, instituted by Exxon in the United States, liability and
damages determinations have been made (which are subject to appeal) against the company and in favor of Exxon. For further information regarding these cases, refer to Note 18 to the Financial Statements included in the company's 1993 Annual Report to its shareholders.
ENVIRONMENTAL MATTERS. The company is subject to federal, state and local laws and regulations designed to protect the environment and limit manufacturing wastes and emissions. The company believes that as a general matter its policies, practices and procedures are properly designed to prevent unreasonable risk of environmental damage and the consequent financial liability to the company. Compliance with the environmental laws and regulations requires continuing management effort and expenditures by the company. Capital expenditures for environmental projects are anticipated to be $20 million in 1994, which is approximately the same as 1993. Management believes that the cost of complying with environmental laws and regulations will not have a material affect on the earnings, liquidity or competitive position of the company.
The company is engaged in the handling, manufacture, use, transportation and disposal of substances that are classified as hazardous or toxic by one or more regulatory agencies. The company believes that its handling, manufacture, use, transportation and disposal of such substances generally have been in accord with environmental laws and regulations.
Among other environmental laws, the company is subject to the federal "Superfund" law, under which the company has been designated as a "potentially responsible party" that may be liable for cleanup costs associated with various waste sites, some of which are on the U.S. Environmental Protection Agency Superfund priority list. The company's experience, consistent with what it believes to be the experience of others in similar cases, is that Superfund site liability tends to be apportioned among parties based upon contribution of materials to the Superfund site. Accordingly, the company measures its liability and carries out its financial reporting responsibilities with respect to Superfund sites based upon this standard, even though Superfund site liability is technically joint and several in nature. The company views the expense of remedial clean-up as a part of its product cost, and accrues for estimated environmental liabilities with regular charges to cost of sales. Management considers its environmental accrual to be adequate to provide for its portion of costs for all known environmental matters, including Superfund sites. Based upon consideration of currently available information, management does not believe liabilities for environmental matters will have a material adverse effect on the company's financial position, operating results or liquidity.
AGRIBUSINESS
As discussed in Note 16 to the Financial Statements, on December 1, 1992, the company transferred substantially all of the Agribusiness segment, other than the specialty vegetable oil operations, to Mycogen Corporation and a joint venture partnership (Agrigenetics, L.P.) formed with Mycogen. The company's 1993 consolidated revenues, costs and expenses include specialty vegetable oil operations, but do not include amounts related to the transferred assets. As also discussed in Note 16 to the Financial Statements, on December 31, 1993, the company exchanged another portion of its investment in the partnership for additional Mycogen common stock and cash. The company's investment in Mycogen, which includes Agrigenetics, Inc. (formerly Agrigenetics, L.P.), is accounted for by the equity method, under which the company recognizes its share of the earnings or losses of such entities.
The specialty vegetable oil operation retained by the company sells specialty vegetable oils and operates an oilseed crushing and refining facility. Specialty vegetable oil sales consist primarily of high oleic sunflower oil in either crude or refined forms and safflower oil. Pursuant to contractual arrangements, the company has agreed to purchase planting seed for specialty vegetable oils from Agrigenetics, Inc., which in turn is to supervise production of oilseed for crushing. The company's ability to acquire high oleic oil seed is subject to governmental, agricultural and export policies as well as the weather. The discussion below is presented only for historical purposes except for any references to specialty vegetable oils.
The transferred portion of the Agribusiness operations produced and marketed planting seeds for agricultural crops. The principal seed products were hybrid seed corn, hybrid sorghum, soybeans, hybrid sunflowers, alfalfa, and cotton. Revenues from planting seeds contributed approximately 75% of the Agribusiness sales in 1992 and 68% in 1991.
Substantially all of the company's planting seed, and oilseed for crushing, was produced by an established network of growers under specified planting conditions on a short-term contract basis. The company furnished parental seed to its growers, primarily from stock developed, multiplied and maintained by the company. Company personnel supervised planting, growing and harvesting.
The seed products were marketed through three regional groups representing eight Agrigenetics seed brands and through an international marketing group and three overseas subsidiaries, all of which sold planting seeds. The products were marketed primarily to dealers and distributors, most of whom were farmers with long-term relationships with the company. The company sold its seeds primarily in the major farm production areas in the United States. The company markets specialty vegetable oil through its own sales organization and commissioned agents. Sales to date have been principally to food processors.
The United States seed industry is highly competitive and fragmented. Based on revenue figures from industry sources, management believes the transferred Agribusiness operations were the sixth largest seed company in the United States. The market for vegetable oils is very large and very competitive. The company's TRISUN(R) sunflower oil sells for a premium over regular sunflower oil. TRISUN(R) oil is very high in monounsaturates, and therefore more stable and resistant to oxidation than other vegetable oils.
Agribusiness revenues from the sale of planting seeds were earned principally during the first half of the calendar year, and losses from these operations were incurred in the last half as a result of continuing operating expenses with low sales. Working capital needs were also seasonal. Expenditures for inventories were made during the last half of the year, while substantial collections on sales were not received until the second and third quarters of the following year.
Strategic Agribusiness activities consisted principally of internal biotechnology research and development directed toward developing new products for the agriculture, food and chemical industries. Agribusiness' research and development consisted of traditional plant breeding and strategic research in advanced plant science. Plant breeding attempts to create desirable plants by crossing selected parent plants. The genetic combinations of the crosses are then tested under field conditions to determine if desired characteristics appear. Traditional research expense of the Agribusiness segment was $7.2 million in 1992 and $7.8 million in 1991.
A major portion of Agribusiness' strategic research and development was conducted at the research laboratory in Madison, Wisconsin. Strategic research was focused on specialty chemicals and food products derived from oil seed crops and on genetic improvement of specific attributes of hybrid plant varieties. Total Agribusiness strategic research expense was $7.7 million in 1992 and $8.6 million in 1991.
The company has United States utility patents covering its high oleic sunflower oil and seeds. The high oleic patents are being re-examined by the U.S. Patent and Trademark Office, and such re-examination has not been resolved. If the re-examination results in the cancellation of the patents, management believes that its business will not be materially affected.
GENERAL
EMPLOYEES. At December 31, 1993, the company and its wholly-owned subsidiaries had 4,613 employees of which approximately 60% were in the U.S.
INTERNATIONAL OPERATIONS. Financial information with respect to domestic and foreign operations is contained in Note 12 to the Financial Statements that is included in the company's 1993 Annual Report to its shareholders and is incorporated herein by reference.
The company supplies its additive customers abroad from overseas manufacturing plants and through export from the United States. Sales and technical service offices are maintained in more than 30 countries outside the United States. As a result, the company is subject to business risks inherent in non-U.S. activities, including political uncertainty, import and export limitations, exchange controls and currency fluctuations. The company believes risks related to its foreign operations are mitigated due to the political and economic stability of the countries in which its largest foreign operations are located.
While changes in the dollar value of foreign currencies will affect earnings from time to time, the longer term economic effect of these changes should not be significant given the company's net asset exposure, currency mix and pricing flexibility. Generally, the income statement effect of changes in the dollar value of foreign currencies is partially or wholly offset by the company's ability to make corresponding price changes in local currency. The company's consolidated net income will generally benefit (decline) as foreign currencies increase (decrease) in value compared to the U.S. dollar. In 1993, European currencies weakened and the Japanese yen strengthened resulting in insignificant net earnings effect.
ITEM 2.



ITEM 2. PROPERTIES
The general offices of the company are located in Wickliffe, Ohio. The company has various leases for general office space primarily located in Eastlake, Ohio; Houston, Texas; and London, England. The company owns three additive manufacturing plants in the United States; one located in the Cleveland, Ohio area, at Painesville, and two near Houston, Texas, at Deer Park and Bayport. Outside the United States, the company owns additive manufacturing plants in Australia, Brazil, Canada, England, France (three locations), Japan, South Africa and Singapore. All of these plants, other than Singapore, are owned in fee. In Singapore, Lubrizol owns the plant but leases the land on which the plant is located. The company owns in fee mechanical testing facilities in Wickliffe, Ohio; Hazelwood, England; and Atsugi, Japan. The company also owns an oilseed crushing and refining plant located in Culbertson, Montana. Finally, the company owns in fee a manufacturing plant in Germany that manufactures performance chemical additives for the coatings industry.
Additive manufacturing plants in India, Mexico, Saudi Arabia and Venezuela are owned and operated by joint venture companies licensed by Lubrizol. Lubrizol's ownership of each of these companies ranges from 40% to 49%.
Lubrizol has entered into long-term contracts for its exclusive use of major marine terminal facilities at the Port of Houston, Texas. In addition, Lubrizol has leases for storage facilities in Australia, Chile, Ecuador, Finland, France, Holland, Singapore, Spain, South Africa, Sweden, and Turkey; East Liverpool, Ohio; Los Angeles, California; St. Paul, Minnesota; Bayonne, New Jersey; and Tacoma, Washington. In some cases, the ownership or leasing of such facilities is through certain of its subsidiaries or affiliates.
The company initiated a manufacturing rationalization plan during the third quarter of 1993. The plan will be implemented over the next several years and, through consolidation, is expected to result in a one-third reduction in the number of units used to produce intermediate products. See Note 17 to the Financial Statements included in the company's Annual Report to its shareholders.
Although the company continues to maintain a capital expenditure program to support its operations, management of the company believes that its facilities are adequate for its present operations and for the foreseeable future.
ITEM 3.

ITEM 3. LEGAL PROCEEDINGS
The company is a party in a case brought by Exxon Corporation and its affiliates, Exxon Chemical Patents, Inc. and Exxon Research & Engineering Company, in the Southern District of Texas, Houston Division on September 19, 1989. In December 1992, the trial jury rendered a verdict that the company willfully infringed an Exxon patent pertaining to an oil soluble copper additive component. In early 1993, the court prohibited the company from making or selling any additive packages in the United States that contained this component and awarded Exxon $18.1 million for attorneys' fees. On November 18, 1993, another jury in the same case awarded Exxon $48 million in damages. The findings of infringement and validity of the Exxon patent as well as the $18.1 million attorneys' fee award are on appeal to the United States Court of Appeals for the Federal Circuit in Washington, D.C., which has jurisdiction over all patent cases. Oral argument in this appeal was heard on December 6, 1993, and a decision may be forthcoming in 1994. On February 18, 1994, acting on a request from Exxon that the damages amount be tripled, the trial court judge doubled the damages amount and awarded prejudgment interest, court costs and additional attorneys' fees to Exxon. The total amount of the judgment, including the previously awarded attorneys' fees, is $129 million. The company has the right to appeal the February 1994 damages award to the same court in Washington, D.C., as is considering the appeal of the original verdict.
The company's management continues to believe that it has not infringed the Exxon patent and that the patent is invalid. Based on the advice of legal counsel, management believes that the December 1992 trial court judgment will not be upheld on appeal.
ITEM 4.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to the vote of the security holders during the three months ended December 31, 1993.
EXECUTIVE OFFICERS OF THE REGISTRANT
The following sets forth the name, age, recent business experience and certain other information relative to each person who is an executive officer of Lubrizol as of March 1, 1994.
PART II
ITEM 5.

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
The Common Shares of The Lubrizol Corporation are listed on the New York Stock Exchange under the symbol LZ. The number of shareholders of record of Common Shares was 6,576 as of February 10, 1994.
All share and per share data have been restated to reflect the 2-for-1 stock split effected on August 31, 1992.
ITEM 6.

ITEM 6. SELECTED FINANCIAL DATA.
The summary of selected financial data for each of the last five years included in the Historical Summary contained on pages 44 and 45 of Lubrizol's 1993 Annual Report to its shareholders is incorporated herein by reference. Other income for 1993 includes $42.4 million for the gain on sale of Genentech (see Note 7) and a special charge of $86.3 million (see Note 17). Included in other income for 1990 is $101.9 million for the gain on sale of Genentech.
ITEM 7.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
The Management's Discussion and Analysis of Financial Condition and Results of Operations contained on pages 25 through 29, inclusive, of Lubrizol's 1993 Annual Report to its shareholders is incorporated herein by reference.
ITEM 8.


ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
The consolidated financial statements of Lubrizol and its subsidiaries, together with the independent auditors' report relating thereto, contained on pages 30 through 42, inclusive, of Lubrizol's 1993 Annual Report to its shareholders, and the Quarterly Financial Data (Unaudited) contained on page 43 of such 1993 Annual Report are incorporated herein by reference.
ITEM 9.

ITEM 9. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
Not applicable.
PART III
ITEM 10.



ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
The information relating to directors of Lubrizol contained under the heading "Election of Directors" on pages 1 to 5, inclusive, of Lubrizol's Proxy Statement dated March 16, 1994, is incorporated herein by reference. Information relative to executive officers of Lubrizol is contained under Part I of this Annual Report on Form 10-K.
ITEM 11.

ITEM 11. EXECUTIVE COMPENSATION.
The information relating to executive compensation contained under the headings "Committees and Compensation of the Board of Directors" on page 6, "Executive Compensation" on pages 8 through 11, inclusive, and under "Employee and Executive Officer Benefit Plans - Pension Plans" and "- Executive Agreements" on pages 15, 16, and 17 of Lubrizol's Proxy Statement dated March 16, 1994, is incorporated herein by reference.
ITEM 12.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The information relating to security ownership set forth under the heading "Security Ownership of Directors and Management" on page 7 of Lubrizol's Proxy Statement dated March 16, 1994, is incorporated herein by reference.
ITEM 13.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
Not applicable.
PART IV
ITEM 14.

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
(a) Documents filed as part of this Annual Report:
1. The following consolidated financial statements of The Lubrizol Corporation and its subsidiaries, together with the independent auditors' report relating thereto, contained on pages 30 through 43, inclusive, of Lubrizol's 1993 Annual Report to its shareholders and incorporated herein by reference:
Consolidated Statements of Income for the years ended December 31, 1993, 1992 and 1991
Consolidated Balance Sheets at December 31, 1993 and
Consolidated Statements of Cash Flows for the years ended December 31, 1993, 1992 and 1991
Consolidated Statements of Shareholders' Equity for the years ended December 31, 1993, 1992 and 1991
Notes to Financial Statements
Independent Auditors' Report
Quarterly Financial Data (Unaudited)
2. Schedules
I Other Investments V Property, Plant and Equipment VI Accumulated Depreciation of Property, Plant and Equipment IX Short-Term Borrowings X Supplementary Income Statement Information
Schedules other than those listed above are omitted because of the absence of conditions under which they are required or because the required information is included in the financial statements and notes thereto.
3. Exhibits
(3)(a) Amended Articles of Incorporation of The Lubrizol Corporation, as adopted September 23, 1991.
(3)(b) Regulations of The Lubrizol Corporation, as amended effective April 27, 1992.
(4)(a) Article Fourth of Amended Articles of Incorporation.
(4)(b) The company agrees, upon request, to furnish to the Securities and Exchange Commission copies of financial documents evidencing long-term debt, which debt does not exceed 10% of the total assets of the company and its subsidiaries on a consolidated basis.
(4)(c) Rights Agreement between The Lubrizol Corporation and National City Bank dated October 6, 1987.
(4)(d) Amendment to Rights Agreement dated October 6, 1987, between The Lubrizol Corporation and National City Bank, effective October 24, 1988.
(4)(e) Special Rights Agreement between The Lubrizol Corporation and National City Bank dated October 31, 1988.
(4)(f) Amendment No. 2 to Rights Agreement dated October 6, 1987, as amended, between The Lubrizol Corporation and National City Bank, effective October 28, 1991.
(4)(g) Amendment No. 1 to Special Rights Agreement dated October 31, 1988, between The Lubrizol Corporation and National City Bank, effective October 28, 1991.
(10)(a)* The Lubrizol Corporation 1975 Employee Stock Option Plan, as amended.
(10)(b)* The Lubrizol Corporation 1985 Employee Stock Option Plan, as amended.
(10)(c)* The Lubrizol Corporation 1981 Key Employee Incentive Stock Option Plan.
(10)(d)* The Lubrizol Corporation Deferred Compensation Plan for Directors.
(10)(e)* Form of Employment Agreement between The Lubrizol Corporation and certain of its senior executive officers.
(10)(f)* The Lubrizol Corporation Excess Defined Benefit Plan, as amended.
(10)(g)* The Lubrizol Corporation Excess Defined Contribution Plan, as amended.
(10)(h)* The Lubrizol Corporation Variable Award Plan.
(10)(i)* The Lubrizol Corporation Executive Death Benefit Plan, as amended.
(10)(j)* Amendment No. 1 to the Amended and Restated Severance Agreement between The Lubrizol Corporation and Dr. R.Y.K. Hsu. (Reference is made to Exhibit (10)(k) to The Lubrizol Corporation's Annual Report on Form 10-K for the year ended December 31, 1990, which Exhibit is incorporated herein by reference.)
(10)(k)* Employment and Consulting Agreement dated February 23, 1987, between The Lubrizol Corporation and Dr. R.Y.K. Hsu with Amendment dated December 28, 1989. (Reference is made to Exhibit (10)(l) to The Lubrizol Corporation's Annual Report on Form 10-K for the year ended December 31, 1990, which Exhibit is incorporated herein by reference.)
(10)(l)* The Lubrizol Corporation 1991 Stock Incentive Plan, as amended.
(10)(m)* The Lubrizol Corporation Deferred Stock Compensation Plan for Outside Directors.
(10)(n)* Amendment to Employment and Consulting Agreement dated October 1, 1992, between The Lubrizol Corporation and Dr. R.Y.K. Hsu. (Reference is made to Exhibit (10)(q) to The Lubrizol Corporation's Annual Report on Form 10-K for the year ended December 31, 1992, which Exhibit is incorporated herein by reference.)
(10)(o)* Early Retirement and General Release Agreement dated April 14, 1993, between The Lubrizol Corporation and William D. Manning.
(10)(p)* The Lubrizol Corporation Officers' Supplemental Retirement Plan
(11) Statement setting forth computation of per share earnings.
(12) Computation of Ratio of Earnings to Fixed Charges. (13) The following portions of The Lubrizol Corporation 1993 Annual Report to its shareholders: Pages 25-29 Management's Discussion and Analysis of Financial Condition and Results of Operations Page 30 Consolidated Statements of Income for the years ended December 31, 1993, 1992 and 1991 Page 31 Consolidated Balance Sheets at December 31, 1993 and 1992 Page 32 Consolidated Statements of Cash Flows for the years ended December 31, 1993, 1992 and 1991 Page 33 Consolidated Statements of Shareholders' Equity for the years ended December 31, 1993, 1992 and Pages 34-41 Notes to Financial Statements Page 42 Independent Auditors' Report Page 43 Quarterly Financial Data (Unaudited) Pages 44-45 Historical Summary (21) List of Subsidiaries of The Lubrizol Corporation. (23) Consent of Independent Auditors.
*Indicates management contract or compensatory plan or arrangement.
(b) The Lubrizol Corporation filed a Current Report on Form 8-K, reporting under "Item 5 - Other Events," a damage award granted to Exxon Corporation on November 18, 1993, against the company.
SIGNATURES
Pursuant to the requirements of Section 13 of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on March 28, 1994, on its behalf by the undersigned, thereunto duly authorized.
THE LUBRIZOL CORPORATION
BY /s/L. E. Coleman --------------------------------- L. E. Coleman, Chairman of the Board and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below on March 28, 1994, by the following persons on behalf of the Registrant and in the capacities indicated.
/s/L. E. Coleman Chairman of the Board and Chief - ------------------------------- Executive Officer and Director L. E. Coleman (Principal Executive Officer)
/s/R. A. Andreas Vice President and Chief Financial - ------------------------------- Officer (Principal Financial Officer) R. A. Andreas
/s/G. P. Lieb Controller, Accounting and Financial - ------------------------------- Reporting (Principal Accounting G. P. Lieb Officer)
/s/W. G. Bares President, Chief Operating Officer - ------------------------------- and Director W. G. Bares
/s/Edward F. Bell Director - ------------------------------- Edward F. Bell
/s/Peggy G. Elliott Director - ------------------------------- Peggy G. Elliott
/s/David H. Hoag Director - ------------------------------ David H. Hoag
/s/Thomas C. MacAvoy Director - ------------------------------- Thomas C. MacAvoy
/s/William P. Madar Director - ------------------------------- William P. Madar
/s/Richard A. Miller Director - ------------------------------- Richard A. Miller
/s/Ronald A. Mitsch Director - ------------------------------- Ronald A. Mitsch
/s/Renold D. Thompson Director - ------------------------------- Renold D. Thompson
/s/Karl E. Ware Director - ------------------------------- Karl E. Ware
INDEPENDENT AUDITORS' REPORT
To the Shareholders and Board of Directors of The Lubrizol Corporation:
We have audited the consolidated financial statements of The Lubrizol Corporation as of December 31, 1993 and 1992 and for each of the three years in the period ended December 31, 1993, and have issued our report thereon dated February 18, 1994; such consolidated financial statements and report are included in your 1993 Annual Report to shareholders and are incorporated herein by reference. Our audits also included the financial statement schedules of The Lubrizol Corporation, listed in Item 14. These financial statement schedules are the responsibility of the Company's management. Our responsibility is to express an opinion based on our audits. In our opinion, such financial statement schedules, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly in all material respects the information set forth therein.
/s/Deloitte & Touche - ----------------------------
DELOITTE & TOUCHE Cleveland, Ohio February 18, 1994
S-1
SCHEDULE I
S-2
SCHEDULE V
S-3
SCHEDULE VI
S-4
SCHEDULE IX
S-5
SCHEDULE X
S-6
EXHIBIT INDEX
(3)(a) Amended Articles of Incorporation of The Lubrizol Corporation, as adopted September 23, 1991.
(3)(b) Regulations of The Lubrizol Corporation, as amended effective April 27, 1992.
(4)(a) Article Fourth of Amended Articles of Incorporation.
(4)(b) The company agrees, upon request, to furnish to the Securities and Exchange Commission copies of financial documents evidencing long-term debt, which debt does not exceed 10% of the total assets of the company and its subsidiaries on a consolidated basis.
(4)(c) Rights Agreement between The Lubrizol Corporation and National City Bank dated October 6, 1987.
(4)(d) Amendment to Rights Agreement dated October 6, 1987, between The Lubrizol Corporation and National City Bank, effective October 24, 1988.
(4)(e) Special Rights Agreement between The Lubrizol Corporation and National City Bank dated October 31, 1988.
(4)(f) Amendment No. 2 to Rights Agreement dated October 6, 1987, as amended, between The Lubrizol Corporation and National City Bank, effective October 28, 1991.
(4)(g) Amendment No. 1 to Special Rights Agreement dated October 31, 1988, between The Lubrizol Corporation and National City Bank, effective October 28, 1991.
(10)(a) The Lubrizol Corporation 1975 Employee Stock Option Plan, as amended.
(10)(b) The Lubrizol Corporation 1985 Employee Stock Option Plan, as amended.
(10)(c) The Lubrizol Corporation 1981 Key Employee Incentive Stock Option Plan.
(10)(d) The Lubrizol Corporation Deferred Compensation Plan for Directors.
(10)(e) Form of Employment Agreement between The Lubrizol Corporation and certain of its senior executive officers.
(10)(f) The Lubrizol Corporation Excess Defined Benefit Plan, as amended.
(10)(g) The Lubrizol Corporation Excess Defined Contribution Plan, as amended.
(10)(h) The Lubrizol Corporation Variable Award Plan.
(10)(i) The Lubrizol Corporation Executive Death Benefit Plan, as amended.
(10)(j) Amendment No. 1 to the Amended and Restated Severance Agreement between The Lubrizol Corporation and Dr. R.Y.K. Hsu. (Reference is made to Exhibit (10)(k) to The Lubrizol Corporation's Annual Report on Form 10-K for the year ended December 31, 1990, which Exhibit is incorporated herein by reference.)
(10)(k) Employment and Consulting Agreement dated February 23, 1987, between The Lubrizol Corporation and Dr. R.Y.K. Hsu with Amendment dated December 28, 1989. (Reference is made to Exhibit (10)(l) to The Lubrizol Corporation's Annual Report on Form 10-K for the year ended December 31, 1990, which Exhibit is incorporated herein by reference.)
(10)(l) The Lubrizol Corporation 1991 Stock Incentive Plan, as amended.
(10)(m) The Lubrizol Corporation Deferred Stock Compensation Plan for Outside Directors.
(10)(n) Amendment to Employment and Consulting Agreement dated October 1, 1992, between The Lubrizol Corporation and Dr. R.Y.K. Hsu. (Reference is made to Exhibit (10)(q) to The Lubrizol Corporation's Annual Report on Form 10-K for the year ended December 31, 1992, which Exhibit is incorporated herein by reference.)
(10)(o) Early Retirement and General Release Agreement dated April 14, 1993, between The Lubrizol Corporation and William D. Manning.
(10)(p) The Lubrizol Corporation Officers' Supplemental Retirement Plan.
(11) Statement setting forth computation of per share earnings.
(12) Computation of Ratio of Earnings to Fixed Charges.
(13) The following portions of The Lubrizol Corporation 1993 Annual Report to its shareholders:
Pages 25-29 Management's Discussion and Analysis of Financial Condition and Results of Operations
Page 30 Consolidated Statements of Income for the years ended December 31, 1993, 1992 and 1991
Page 31 Consolidated Balance Sheets at December 31, 1993 and 1992
Page 32 Consolidated Statements of Cash Flows for the years ended December 31, 1993, 1992 and 1991
Page 33 Consolidated Statements of Shareholders' Equity for the years ended December 31, 1993, 1992 and 1991
Pages 34-41 Notes to Financial Statements
Page 42 Independent Auditors' Report
Page 43 Quarterly Financial Data (Unaudited)
Pages 44-45 Historical Summary
(21) List of Subsidiaries of The Lubrizol Corporation.
(23) Consent of Independent Auditors.