Annual Report (Form 10-K), fiscal year 1994

ITEM 1. BUSINESS; ITEM 2.




ITEM 3. LEGAL PROCEEDINGS
The Company, certain of its current officers and directors and one retired officer/director are named in a consolidated class action lawsuit brought in Federal court in Houston on behalf of persons who purchased Cooper stock during the period from February 1, 1993 through January 25, 1994. The complaints appear to allege that the defendants, through certain public statements, misled investors respecting (i) deterioration in certain of the Company's markets and the demand for some of its products, and (ii) the Company's anticipated performance in 1994. On February 6, 1995 the court denied a motion filed by the Company to dismiss the class action. While the ultimate liability, if any, that may result from these lawsuits cannot be determined with certainty at this time, the Company believes that its investigation of the facts to date has not revealed anything to support the plaintiffs' claims. The Company intends to vigorously defend this litigation.
During November 1992, the Cooper-Bessemer Rotating operation of the Company (now part of discontinued operations) received a letter from the Ohio Attorney General's office alleging violations of the Ohio Right To Know, Toxic Release Inventory reporting requirements. The allegations arise out of an Ohio EPA audit of the facility on April 30, 1992. The State initially proposed a penalty of $212,240. On December 31, 1994, the parties reached an agreement and on February 6, 1995 the court entered a Consent Order. Under the Consent Order, the Company paid fines totaling $47,500 and committed to install two supplemental environmental projects at the facility. If the projects are not completed by February 28 and April 28, 1995, respectively, the Company will be required to pay an additional $21,250 in otherwise "suspended" penalties.
In March 1993, the Wisconsin Department of Natural Resources (DNR) alleged violations by the Company's Pewaukee, Wisconsin plant of air pollution control regulations concerning organic compound emissions from two coating lines and a rotary tumble coater. In April 1994, the Company and the State of Wisconsin entered into a settlement agreement under which the Company agreed to test changes in processes and coating materials to lower the amount of emissions and to cause the facility to be in compliance no later than April 1996. The Company agreed to pay a civil penalty of $128,712 and $127 per day during the implementation of the compliance schedule. The settlement was approved by the Circuit Court for Waukesha County in April 1994. From April 1994, the Company has paid civil penalties of $179,567, including the per diem penalty of $127. Working closely with the DNR, the Company anticipates completion of the compliance schedule by the end of the third quarter of 1995.
The Company is also subject to various other suits, legal proceedings and claims that arise in the normal course of business. While it is not feasible to predict the outcome of these matters with certainty, management is of the opinion that their ultimate disposition should not have a material adverse effect on the Company's financial position.
ITEM 4.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
During the fourth quarter of the fiscal year covered by this report, no matters were submitted to a vote of the shareholders.
PART II
ITEM 5.

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
The Company's Common Stock (symbol - CBE) is listed on the New York Stock Exchange and the Pacific Stock Exchange. Options for the Company's Common Stock are listed on the American Stock Exchange.
As of March 1, 1995 there were 35,333 record holders of the Company's Common Stock.
The high and low quarterly sales price for the past two years of the Company's Common Stock, as reported by Dow Jones & Company, Inc., are as follows:
Annual cash dividends declared on the Company's Common Stock during 1994 and 1993 were $1.32 a share ($.33 a quarter). On February 14, 1995, the Board of Directors declared a quarterly dividend of $.33 a share, which will be paid April 3, 1995 to shareholders of record on March 1, 1995.
ITEM 6.

ITEM 6. SELECTED FINANCIAL DATA
The following table sets forth selected historical financial data for Cooper for each of the five years in the period ended December 31, 1994. The selected historical financial information for Cooper for the years ended December 31, 1990, 1991, 1992, 1993 and 1994 shown below has been derived from the audited consolidated financial statements of Cooper. This information should be read in conjunction with the consolidated financial statements of Cooper and notes thereto incorporated herein by reference to pages A-12 through A-41 of Appendix A to the Cooper Proxy Statement for the 1995 Annual Meeting of Shareholders.
(Continued on following page)
___________________ (1) Restated to exclude discontinued operations. (2) During 1992, Cooper acquired Moog Automotive Group, Inc. in a transaction that was accounted for as a purchase. (3) In the first quarter of 1992, Cooper adopted the following accounting standards: SFAS No. 106 (Employers' Accounting for Postretirement Benefits Other Than Pensions); SFAS No. 109 (Accounting for Income Taxes); SFAS No. 112 (Employers' Accounting for Postemployment Benefits). See Note 4 of the Notes to Consolidated Financial Statements incorporated herein by reference to pages A-21 through A-22 of Appendix A to the Cooper Proxy Statement for the 1995 Annual Meeting of Shareholders. (4) Excluding $375 million in 1994 and $450 million in 1993 allocated to discontinued operations.
___________________ (1) Restated to exclude discontinued operations. (2) During 1992, Cooper acquired Moog Automotive Group, Inc. in a transaction that was accounted for as a purchase. (3) In the first quarter of 1992, Cooper adopted the following accounting standards: SFAS No. 106 (Employers' Accounting for Postretirement Benefits Other Than Pensions); SFAS No. 109 (Accounting for Income Taxes); SFAS No. 112 (Employers' Accounting for Postemployment Benefits). See Note 4 of the Notes to Consolidated Financial Statements incorporated herein by reference to pages A-21 through A-22 of Appendix A to the Cooper Proxy Statement for the 1995 Annual Meeting of Shareholders. (4) Excluding $375 million in 1994 and $450 million in 1993 allocated to discontinued operations.
For additional information concerning the year-to-year comparability of the financial information set forth in the preceding table, see (i) Notes 1 through 5, 10, 11 and 14 of the Notes to Consolidated Financial Statements and (ii) Management's Discussion and Financial Review, incorporated herein by reference to pages A-1 through A-11, A-18 through A-23, A-26 through A-28, A-29 through A-30 and A-33 through A-34 of Appendix A to the Cooper Proxy Statement for the 1995 Annual Meeting of Shareholders.
ITEM 7.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Incorporated by reference to pages A-1 through A-11 of Appendix A to the Cooper Proxy Statement for the 1995 Annual Meeting of Shareholders.
ITEM 8.


ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Incorporated by reference to pages A-12 through A-41 of Appendix A to the Cooper Proxy Statement for the 1995 Annual Meeting of Shareholders.
ITEM 9.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
Not applicable.
PART III
ITEM 10.



ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Incorporated by reference to pages 3 through 8 and 9 of the Cooper Proxy Statement for the 1995 Annual Meeting of Shareholders.
ITEM 11.

ITEM 11. EXECUTIVE COMPENSATION
Incorporated by reference to pages 11 through 18 of the Cooper Proxy Statement for the 1995 Annual Meeting of Shareholders.
ITEM 12.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Incorporated by reference to pages 2 and 10 of the Cooper Proxy Statement for the 1995 Annual Meeting of Shareholders.
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) 1. Financial Statements and Other Financial Data (incorporated by reference to the pages shown below in Appendix A to the Cooper Proxy Statement for the 1995 Annual Meeting of Shareholders).
Financial information with respect to subsidiaries not consolidated and 50% or less owned persons accounted for by the equity method has not been included since in the aggregate such subsidiaries and investments do not constitute a significant subsidiary.
2. Financial Statement Schedules
Financial statement schedules are not included in this Form 10-K Annual Report because they are not applicable or the required information is shown in the financial statements or notes thereto.
3. Exhibits
3.1 Twenty-Fifth Amended Articles of Incorporation of Cooper Industries, Inc. (incorporated herein by reference to Exhibit 3.1 of the Company's Form 10-K for the year ended December 31, 1992).
3.2 Code of Regulations (By-Laws), as amended, of Cooper Industries, Inc. (incorporated herein by reference to Exhibit 3.2 of the Company's Form 10-K for the year ended December 31, 1992).
4.1 Rights Agreement, dated as of February 17, 1987, between Cooper Industries, Inc. and First Chicago Trust Company of New York as Rights Agent, an amendment thereto dated August 14, 1989 (incorporated herein by reference to Exhibit 4.4 to Registration Statement No. 33-31941), and an amendment thereto dated November 6, 1990 (incorporated herein by reference to Exhibit 4.4 to Registration Statement No. 33-38808).
4.2 Form of Indenture between Cooper Industries, Inc. and The First National Bank of Chicago, as Trustee, relating to the 7.05% Convertible Subordinated Debentures due 2015 (incorporated herein by reference to Exhibit 4.2 to Registration Statement No. 33-31941).
10.1 1989 Director Stock Option Plan (incorporated herein by reference to Exhibit 28.1 to Registration Statement No. 2-33-29302).
10.2 Cooper Industries, Inc. Directors Deferred Compensation Plan (incorporated herein by reference to Exhibit 10.2 of the Company's Form 10-K for the year ended December 31, 1992).
10.3 Cooper Industries, Inc. Directors Retirement Plan (incorporated herein by reference to Exhibit 10.3 of the Company's Form 10-K for the year ended December 31, 1992).
10.4 Cooper Industries, Inc. Executive Restricted Stock Incentive Plan (incorporated herein by reference to Exhibit 10.4 of the Company's Form 10-K for the year ended December 31, 1992).
10.5 Cooper Industries, Inc. Supplemental Excess Defined Benefit Plan (incorporated herein by reference to Exhibit 10.6 of the Company's Form 10-K for the year ended December 31, 1992).
10.6 Cooper Industries, Inc. Supplemental Excess Defined Contribution Plan (incorporated herein by reference to Exhibit 10.7 of the Company's Form 10-K for the year ended December 31, 1992).
10.7 Management Incentive Compensation Deferral Plan (incorporated herein by reference to Exhibit 10.8 of the Company's Form 10-K for the year ended December 31, 1992).
10.8 Crouse-Hinds Company Officers' Disability and Supplemental Pension Plan (incorporated herein by reference to Exhibit 10.9 of the Company's Form 10-K for the year ended December 31, 1992).
10.9 Amended and Restated Asset Transfer Agreement, dated as of January 1, 1995, by and between Cooper Industries, Inc. and Cooper Cameron Corporation (incorporated herein by reference to Exhibit 2.1 to Cooper Cameron Corporation Registration Statement No. 33-90288).
10.10 Canadian Asset Transfer Agreement, dated as of January 1, 1995, by and between Cooper Industries (Canada) Inc. and Cooper Cameron Limited (incorporated herein by reference to Exhibit 2.2 to Cooper Cameron Corporation Registration Statement No. 33-90288).
10.11 German Asset Transfer Agreement, dated as of January 1, 1995, by and between Champion Spark Plug GmbH and Cooper Oil Tool GmbH (incorporated herein by reference to Exhibit 2.3 to Cooper Cameron Corporation Registration Statement No. 33-90288).
10.12 Norway Asset Transfer Agreement, dated as of January 1, 1995, by and between Cooper Oil Tool Norway A/S and Cooper Cameron Norge A/S (incorporated herein by reference to Exhibit 2.4 to Cooper Cameron Corporation Registration Statement No. 33-90288).
10.13 Amended and Restated United Kingdom Asset Transfer Agreement, dated as of January 1, 1995, by and among CoopCam (U.K.) Limited, Cooper Cameron (U.K.) Limited and Cooper (Great Britain) Ltd. (incorporated herein by reference to Exhibit 2.5 to Cooper Cameron Corporation Registration Statement No. 33-90288).
13.0 Text of Appendix A to Cooper Industries, Inc. Proxy Statement for the Annual Meeting of Shareholders to be held April 25, 1995.
21.0 List of Cooper Industries, Inc. Subsidiaries.
23.0 Consent of Ernst & Young LLP.
24.0 Powers of Attorney from members of the Board of Directors of Cooper Industries, Inc.
Cooper will furnish to the Commission supplementally upon request a copy of any instrument with respect to long-term debt of the Company. Copies of the above Exhibits are available to shareholders of record at a charge of $.25 per page, minimum order of $10.00. Direct requests to:
Cooper Industries, Inc. Attn: Corporate Secretary P.O. Box 4446 Houston, Texas 77210
(b) Reports on Form 8-K. The Company filed a report on Form 8-K on November 23, 1994 to restate selected financial information originally filed under Form 10-K for the year ended December 31, 1993. The restatement, which reflects the separation of "continuing" and "discontinued" operations, was prepared in connection with the Company's decision to establish its petroleum and industrial equipment business as an independent, publicly-traded company through an exchange offer with the holders of the Company's Common Stock. The Form 8-K contains the following financial statements and report:
Report of Independent Auditors dated January 24, 1994, except as to Note 1, as to which the date is September 30, 1994
Consolidated Results of Operations for Each of the Two Years in the Period Ended December 31, 1993
Consolidated Balance Sheet as of December 31, 1993 and December 31, 1992
Consolidated Cash Flows for Each of the Two Years in the Period Ended December 31, 1993 (not restated)
Consolidated Changes in Shareholders' Equity for Each of the Two Years in the Period Ended December 31, 1993
Notes to Consolidated Financial Statements
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Ex- change Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
COOPER INDUSTRIES, INC.
Date: March 30, 1995 By /s/ ROBERT CIZIK (Robert Cizik, Chairman and Chief Executive Officer)
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
Cooper Industries, Inc.
1994 Annual Report on Form 10-K
Cross Reference Sheet
INDEX TO EXHIBITS
Exhibit No. Description ------- -----------
3.1 Twenty-Fifth Amended Articles of Incorporation of Cooper Industries, Inc. (incorporated herein by reference to Exhibit 3.1 of the Company's Form 10-K for the year ended December 31, 1992).
3.2 Code of Regulations (By-Laws), as amended, of Cooper Industries, Inc. (incorporated herein by reference to Exhibit 3.2 of the Company's Form 10-K for the year ended December 31, 1992).
4.1 Rights Agreement, dated as of February 17, 1987, between Cooper Industries, Inc. and First Chicago Trust Company of New York as Rights Agent, an amendment thereto dated August 14, 1989 (incorporated herein by reference to Exhibit 4.4 to Registration Statement No. 33-31941), and an amendment thereto dated November 6, 1990 (incorporated herein by reference to Exhibit 4.4 to Registration Statement No. 33-38808).
4.2 Form of Indenture between Cooper Industries, Inc. and The First National Bank of Chicago, as Trustee, relating to the 7.05% Convertible Subordinated Debentures due 2015 (incorporated herein by reference to Exhibit 4.2 to Registration Statement No. 33-31941).
10.1 1989 Director Stock Option Plan (incorporated herein by reference to Exhibit 28.1 to Registration Statement No. 2-33-29302).
10.2 Cooper Industries, Inc. Directors Deferred Compensation Plan (incorporated herein by reference to Exhibit 10.2 of the Company's Form 10-K for the year ended December 31, 1992).
10.3 Cooper Industries, Inc. Directors Retirement Plan (incorporated herein by reference to Exhibit 10.3 of the Company's Form 10-K for the year ended December 31, 1992).
10.4 Cooper Industries, Inc. Executive Restricted Stock Incentive Plan (incorporated herein by reference to Exhibit 10.4 of the Company's Form 10-K for the year ended December 31, 1992).
10.5 Cooper Industries, Inc. Supplemental Excess Defined Benefit Plan (incorporated herein by reference to Exhibit 10.6 of the Company's Form 10-K for the year ended December 31, 1992).
10.6 Cooper Industries, Inc. Supplemental Excess Defined Contribution Plan (incorporated herein by reference to Exhibit 10.7 of the Company's Form 10-K for the year ended December 31, 1992).
10.7 Management Incentive Compensation Deferral Plan (incorporated herein by reference to Exhibit 10.8 of the Company's Form 10-K for the year ended December 31, 1992).
10.8 Crouse-Hinds Company Officers' Disability and Supplemental Pension Plan (incorporated herein by reference to Exhibit 10.9 of the Company's Form 10-K for the year ended December 31, 1992).
10.9 Amended and Restated Asset Transfer Agreement, dated as of January 1, 1995, by and between Cooper Industries, Inc. and Cooper Cameron Corporation (incorporated herein by reference to Exhibit 2.1 to Cooper Cameron Corporation Registration Statement No. 33-90288).
10.10 Canadian Asset Transfer Agreement, dated as of January 1, 1995, by and between Cooper Industries (Canada) Inc. and Cooper Cameron Limited (incorporated herein by reference to Exhibit 2.2 to Cooper Cameron Corporation Registration Statement No. 33-90288).
10.11 German Asset Transfer Agreement, dated as of January 1, 1995, by and between Champion Spark Plug GmbH and Cooper Oil Tool GmbH (incorporated herein by reference to Exhibit 2.3 to Cooper Cameron Corporation Registration Statement No. 33-90288).
10.12 Norway Asset Transfer Agreement, dated as of January 1, 1995, by and between Cooper Oil Tool Norway A/S and Cooper Cameron Norge A/S (incorporated herein by reference to Exhibit 2.4 to Cooper Cameron Corporation Registration Statement No. 33-90288).
10.13 Amended and Restated United Kingdom Asset Transfer Agreement, dated as of January 1, 1995, by and among CoopCam (U.K.) Limited, Cooper Cameron (U.K.) Limited and Cooper (Great Britain) Ltd. (incorporated herein by reference to Exhibit 2.5 to Cooper Cameron Corporation Registration Statement No. 33-90288).
13.0 Text of Appendix A to Cooper Industries, Inc. Proxy Statement for the Annual Meeting of Shareholders to be held April 25, 1995.
21.0 List of Cooper Industries, Inc. Subsidiaries.
23.0 Consent of Ernst & Young LLP.
24.0 Powers of Attorney from members of the Board of Directors of Cooper Industries, Inc.