1
`
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`
` SECURITIES AND EXCHANGE COMMISSION
` WASHINGTON, D.C. 20549
`
` FORM 10-K
`
` /X/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF
` THE SECURITIES EXCHANGE ACT OF 1934
`
` FOR FISCAL YEAR ENDED JUNE 30, 1996
`
` / / 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
` 1-10747
`
` DURACELL INTERNATIONAL INC.
` (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
`
`
`
` DELAWARE 06-1240267
` (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
` INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
`
` BERKSHIRE CORPORATE PARK, BETHEL, CT 06801
` (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
`
`
` (203) 796-4000
` (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
` ------------------------
`
` SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF ACT:
`
`
`
` NAME OF EACH EXCHANGE
` TITLE ON WHICH REGISTERED
`- --------------------------------------------- --------------------------------
`
` Common Stock New York Stock Exchange
`
`
` SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF ACT:
`
` NONE
`
` Indicate by a 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 /X/ No / /
`
` Indicate by check mark if disclosure of delinquent filers pursuant to Item
`405 of Regulation S-K is not contained herein and will not be contained to the
`best of registrant's knowledge, in definitive proxy or information statements
`incorporated by reference in Part III of this Form 10-K or any amendment to this
`Form 10-K. /X/
`
` The aggregate market value of voting stock held by non-affiliates of the
`registrant as of September 13, 1996 was approximately $7,453 million. Limited
`partnerships affiliated with Kohlberg Kravis Roberts & Co., L.P. and directors
`and executive officers of the registrant are considered affiliates for purposes
`of this calculation but should not necessarily be deemed affiliates for any
`other purpose.
`
`
`
` Number of shares of Common Stock, par value $0.01, outstanding as
` of September 13, 1996.......................................... 119,403,902
`
`
` DOCUMENTS INCORPORATED BY REFERENCE
`
`
`Apple Inc., et al.
`Exhibit 1025
`Apple Inc., et al. v. Global Touch Solutions, Inc.
`IPR2015-01175
`
`Exhibit 1025, Page 001
`
`

`

`
` Portions of the Annual Report to Shareholders for the fiscal year ended
`June 30, 1996 are incorporated by reference into Part I and Part II of this
`Report.
`- --------------------------------------------------------------------------------
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`
`
`Exhibit 1025, Page 002
`
`

`

` 2
`
` PART I
`
`ITEM 1. BUSINESS
`
` Duracell International Inc. ("Duracell" or the "Company") manufactures and
`markets, primarily under the DURACELL(R) brand, high performance alkaline
`batteries, primary lithium batteries and other battery types. Duracell also
`markets rechargeable nickel metal hydride batteries and a lighting products
`line. Duracell maintains a leading position in North American and European
`consumer battery markets with its "copper and black" DURACELL brand alkaline
`batteries. Alkaline batteries accounted for approximately 83% of Duracell's
`sales during fiscal 1996. Duracell's batteries are sold worldwide through
`consumer channels, to industrial users and to manufacturers of battery-powered
`consumer, industrial, medical and military equipment.
`
` Duracell has experienced 23 consecutive years of sales increases, due in
`large part to the expanding market for its principal product, alkaline
`batteries. Duracell markets consumer batteries worldwide under the DURACELL
`brand.
`
` The Company is a Delaware corporation organized in 1988 at the direction of
`Kohlberg Kravis Roberts & Co., L.P. ("KKR") to effect the acquisition of
`Duracell Inc., its battery-related subsidiaries and affiliates and certain
`related assets from Kraft, Inc. (the "Acquisition"). The Acquisition was
`completed on June 24, 1988. Most of the businesses of Duracell are conducted
`under the same trade names used before the Acquisition.
`
` In May 1991, the Company completed an initial public offering of 34,500,000
`shares of its Common Stock and became a listed company on the New York Stock
`Exchange. A second public offering of 5,000,000 shares of Common Stock was
`completed in October 1991.
`
` On September 12, 1996 it was announced that the Company has signed an
`agreement to merge with The Gillette Company. The merger is expected to be
`completed by the end of calendar 1996. Under the terms of the merger agreement,
`each outstanding share of Duracell common stock will be exchanged for .904
`shares of Gillette common stock.
`
`FINANCIAL INFORMATION ABOUT THE COMPANY'S GEOGRAPHIC AREAS OF OPERATION
`
` Information about Duracell's geographic areas of operation is incorporated
`by reference to Note 14, Geographic Areas of Operations, which appears on page
`53 of Duracell's Annual Report to Shareholders for the fiscal year ended June
`30, 1996.
`
`PRODUCTS
`
` Duracell's battery line comprises alkaline, lithium, zinc air and nickel
`metal hydride rechargeable batteries. Duracell also sells zinc carbon type
`batteries. Alkaline batteries produce a far greater amount of energy within any
`given battery size than is possible in zinc carbon batteries, the dominant
`battery type throughout the world until the 1980s. This performance superiority
`has resulted in alkaline batteries steadily displacing zinc carbon batteries.
`
` Duracell is at the forefront of primary lithium battery development and is
`a leading primary lithium battery manufacturer for consumer devices. Lithium
`batteries have performance advantages over conventional consumer batteries in
`certain applications, their extremely high energy density and long shelf life
`being the most notable advantages.
`
` Duracell's line of zinc air batteries, most of which are "button cells,"
`are used principally in hearing aids and medical equipment.
`
` Over the past several years Duracell, Toshiba Battery Co., Ltd. of Japan
`and Varta Batterie AG of Germany have engaged in joint research and development
`of nickel metal hydride rechargeable cells. Nickel metal hydride rechargeable
`batteries are becoming the battery of choice for use in devices having high
`power requirements such as camcorders, portable computers and cellular phones.
`They are also an environmentally attractive substitute for the nickel-cadmium
`batteries now being used to power many such devices. During
`
` Page 2
`
`Exhibit 1025, Page 003
`
`

`

` 3
`
`fiscal 1995 affiliates of the three companies formed a joint venture for the
`purpose of constructing and operating a manufacturing facility in the United
`States to produce nickel metal hydride cells for use in rechargeable batteries
`sold by the three companies. The facility was completed during fiscal 1996 and
`will begin commercial production in early fiscal 1997. Duracell has a 40%
`interest in the joint venture, with Toshiba and Varta holding the remaining 40%
`and 20%, respectively.
`
` Duracell is continuing its efforts to convince the leading manufacturers of
`portable computers, cellular telephones and other devices with high power
`requirements to design-in standardized nickel metal hydride rechargeable
`batteries as the power source for their devices. Duracell also plans to begin
`manufacturing rechargeable lithium ion batteries in the United States during
`fiscal 1997.
`
`NORTH AMERICAN OPERATIONS
`
` In North America, alkaline batteries account for a substantial majority of
`household battery sales. Duracell's management estimates that in fiscal 1996,
`alkaline batteries accounted for approximately 88% of the United States consumer
`battery market. The DURACELL brand has the leading alkaline market share.
`
` Duracell competes with several major brands in the highly competitive
`United States battery market. Eveready Battery Company, a subsidiary of Ralston
`Purina Company, manufactures Energizer brand alkaline batteries and is
`Duracell's primary U.S. competitor. Other U.S. competitors include Rayovac
`Corporation and numerous imported brands.
`
` In Canada, the DURACELL brand has the leading alkaline market share in a
`market where Duracell's management estimates that alkaline batteries account for
`approximately 75% of the consumer battery market. Eveready Battery Company is
`Duracell's primary Canadian competitor.
`
`INTERNATIONAL OPERATIONS
`
` Duracell's international operations are divided organizationally into two
`groups: Europe and Other International Markets, consisting of Mexico, South
`America, the Caribbean, the Middle East, India, Africa, China, the Pacific Rim
`and various other developing alkaline markets.
`
` Although Duracell is truly a pan-European battery business, Duracell's
`European operations concentrate on the largest markets, namely the United
`Kingdom, Germany, France, Spain and Italy. Duracell Europe also has a strong
`brand presence in Scandinavia, the Benelux countries, Portugal and Austria. The
`Eastern European countries offer significant potential for growth, and Duracell
`has established business units in a number of them, including: Hungary, Czechia,
`Poland and Russia. The DURACELL brand is the leading alkaline battery brand in
`Europe. Duracell also markets a series of national brands, most notably
`SUPERPILA (Italy), DAIMON (Germany) and HELLESENS/TUDOR (Scandinavia). In
`Europe, the DURACELL brand competes with the Energizer brand and numerous
`national alkaline brands, several of which are important brands in the country
`of their manufacture, but DURACELL is in most instances the leading alkaline
`brand. In European markets, where zinc carbon batteries maintain a higher market
`share than in North America, Duracell sells more zinc carbon batteries than it
`sells in any other market.
`
` The DURACELL brand competes with numerous brands in Other International
`Markets. Most of the batteries sold by Duracell in Other International Markets
`are alkaline batteries. Although Duracell has achieved a high alkaline share in
`numerous countries included in Other International Markets, overall alkaline
`sales as a percentage of total battery sales are low as compared to zinc carbon
`battery sales. Duracell's management believes that the countries comprising
`Duracell's Other International Markets have significant potential for continued
`alkaline penetration.
`
` In fiscal 1996, Duracell acquired Eveready South Africa, the leading
`consumer battery company in that country. In May, 1996 Duracell announced the
`intended acquisition of STC Corporation's SUNPOWER trademark and consumer
`battery sales and distribution operations in South Korea, for approximately $115
`million. SUNPOWER is a major battery brand in South Korea. Completion of the
`transaction is expected by the end of calendar 1996.
`
` Page 3
`
`Exhibit 1025, Page 004
`
`

`

` 4
`
` In fiscal 1994, Duracell formed joint venture companies in both China and
`India to manufacture and distribute DURACELL brand alkaline batteries. Duracell
`holds a controlling interest in each of these companies. China and India offer
`significant growth opportunities for Duracell due to the size of these markets.
`New alkaline manufacturing facilities in these countries were substantially
`completed during fiscal 1996, and production is expected to begin at both
`facilities by the end of calendar 1996.
`
`MARKETING AND DISTRIBUTION
`
` Duracell promotes its batteries through a variety of means, including
`television advertising, store displays and trade and consumer promotions.
`Duracell's advertising emphasizes the long service life of DURACELL batteries
`and product differentiation, such as the new Duracell(R) PowerCheck(TM)
`batteries featuring an on-label tester. Duracell sponsors various trade and
`consumer promotions intended to foster brand awareness and to maintain
`favorable, multiple display positions in retail stores. Duracell distributes its
`products principally through retailers, ranging from mass merchandisers and
`warehouse clubs to sole proprietor outlets.
`
` Each of Duracell's principal foreign subsidiaries has its own sales and
`marketing staffs. Major accounts are serviced by the local sales force. Smaller
`retail accounts are usually serviced through local distributors.
`
` Duracell works closely with many original equipment manufacturers in their
`development of new battery-powered devices designed to be used with Duracell's
`batteries. Such efforts have been instrumental in developing the consumer
`primary lithium battery market and are essential to Duracell's success in
`selling standard size nickel metal hydride batteries and successfully
`introducing lithium ion rechargeable batteries.
`
`MANUFACTURING AND RAW MATERIALS
`
` Duracell manufactures batteries in the United States, Canada, Mexico, South
`Africa, the United Kingdom and Belgium. Duracell's Aarschot, Belgium facility is
`believed to be the largest alkaline battery plant in the world. Construction of
`alkaline manufacturing facilities in China and India is substantially complete.
`
` Duracell's plants are modern and its manufacturing process is highly
`automated. Labor costs represent a relatively small portion of product cost. In
`the United States and Europe, Duracell manufactures many of the components used
`in its assembly of alkaline batteries. The most significant raw materials used
`by Duracell in its manufacture of alkaline batteries are steel, zinc and
`electrolytic manganese dioxide powder. There is a variety of worldwide sources
`for these raw materials and Duracell's management believes it will continue to
`have access to adequate quantities of such materials at competitive prices.
`
` Duracell is presently purchasing cells used in its production of
`rechargeable nickel metal hydride batteries from Toshiba Battery Co., Ltd. The
`U.S. joint venture formed by affiliates of Duracell, Toshiba and Varta has
`completed the construction of a new nickel metal hydride cell manufacturing
`facility in Mebane, North Carolina. See Note 2 to the Consolidated Financial
`Statements.
`
`SEASONALITY
`
` Worldwide battery sales are significantly greater in the second half of the
`calendar year than the first half as a result of industry-wide marketing
`programs and consumers' traditionally strong purchases of battery-powered
`products during the holiday season.
`
`BACKLOG
`
` The vast majority of Duracell's sales are made through consumer sales
`channels; therefore, most customer orders are satisfied within only a few
`business days. Consequently, Duracell's order backlog is not significant.
`
` Page 4
`
`Exhibit 1025, Page 005
`
`

`

` 5
`
`CUSTOMERS
`
` Duracell's business is not dependent on any single customer or limited
`group of customers, the loss of which would have a material adverse effect on
`its business. There is, however, a trend toward larger retailers, particularly
`mass merchandisers and warehouse clubs, controlling an increasing share of the
`consumer battery market in more developed markets such as the United States.
`
`COMPETITION
`
` The worldwide battery market is highly competitive, particularly as to
`price and product performance.
`
`PATENTS AND TRADEMARKS
`
` As a result of continuous engineering, and research and development by
`Duracell's engineers and scientists, Duracell has been issued a considerable
`number of patents throughout the world. The Company also owns numerous
`registered trademarks, including DURACELL, DYNACHARGE, COPPER TOP, ACTIVAIR,
`SUPERPILA, DAIMON, HELLESENS, DURABEAM, PROCELL and MALLORY, which are used in
`connection with the sale of its batteries and lighting products. Duracell's
`management believes such patents and trademarks have considerable value,
`particularly the DURACELL trademark.
`
`RESEARCH AND DEVELOPMENT
`
` Duracell's research and development staff is located in a modern laboratory
`facility in Needham, Massachusetts. Duracell also operates technical centers in
`the United Kingdom and in Connecticut.
`
` Duracell's research and development efforts focus on the search for new
`high-power batteries for the consumer market and on the improvement of its
`existing products. In fiscal 1996, Duracell concentrated much of its research
`and development efforts on enhancing the performance of its alkaline and nickel
`metal hydride rechargeable batteries, and the development of a new line of
`rechargeable lithium ion batteries. Duracell will continue such emphasis in
`fiscal 1997.
`
` Duracell spent $34.4 million, $34.7 million and $29.6 million on research
`and development and $23.1 million, $22.9 million and $22.8 million on
`engineering activities in fiscal 1996, 1995 and 1994, respectively.
`
`EMPLOYEES
`
` Duracell had approximately 9,600 employees at June 30, 1996. Duracell's
`United States labor force is not unionized. Approximately 1,800 international
`employees are members of national labor unions. Management believes that
`Duracell's overall relations with its employees are good.
`
`FORWARD-LOOKING AND CAUTIONARY STATEMENTS
`
` Duracell and its officers from time to time make written or oral
`forward-looking statements, including statements contained in Duracell's filings
`with the Securities and Exchange Commission and in reports to stockholders. In
`connection with the "safe harbor" provisions of the Private Securities
`Litigation Reform Act of 1995, important factors that could cause Duracell's
`actual results to differ materially from those projected in forward looking
`statements of the Company made by or on behalf of the Company are set forth
`below:
`
` - A significant decline in the growth rate in the household battery
` market in major markets such as the United States, Europe, and those
` countries within Duracell's Other International Markets segment in which
` Duracell has significant operations.
`
` - Actions by competitors or certain key customers which result in
` Duracell's loss of a significant distribution channel or customer. For
` example, the decision by a major retailer to no longer sell DURACELL
` batteries or the inability to implement anticipated price increases,
` resulting in lower-than-expected operating profits.
`
` Page 5
`
`Exhibit 1025, Page 006
`
`

`

` 6
`
` - Slower than expected development of Duracell's rechargeable
` business. Duracell expects that as the markets for personal computers,
` cellular phones and other consumer electronics mature, the number of
` battery sizes will consolidate to relatively few standard sizes, making the
` sale of such devices on a "batteries not included" basis, as well as sale
` of replacement batteries through normal retail channels, more prevalent.
` This pattern has been followed historically for battery powered products
` such as cameras and camcorders. Failure of the cellular phone and personal
` computer categories to follow this pattern would have an adverse effect on
` Duracell's expected growth in sales and profitability of high power
` rechargeable batteries.
`
` - Introduction of new value-added product features or new battery
` chemistries by a competitor which attract sufficient consumers to
` deteriorate Duracell's market share.
`
` - Because of the significance of Duracell's operations outside of the
` United States, and in such diverse markets as South Africa, China, India,
` Mexico, among others, the Company is subject to the effects of, and changes
` in, the monetary, fiscal and legal policies of foreign governments and
` agencies. Other factors affecting Duracell's business are social and
` economic conditions, the ability to obtain or hedge foreign currency in
` accordance with Duracell's policy, and foreign exchange rate fluctuations.
` Nationalization of Duracell's businesses and unstable governments would
` also adversely affect the Company's results.
`
` - Delays or unanticipated inefficiencies in Duracell's new alkaline
` plants in China and India.
`
` - The adoption of unanticipated environmental regulations in
` Duracell's major markets which impact alkaline demand.
`
` - Significant damage to a major Duracell manufacturing facility which
` results in a loss of business momentum.
`
`ITEM 2. PROPERTIES
`
` Duracell has 12 manufacturing sites around the world and occupies numerous
`warehouses and offices. The following table sets forth information with respect
`to Duracell's manufacturing sites:
`
`
`
` LOCATION OF PLANT STATUS
` ------------------------------------------------------------ -------
`
` North America
` Cleveland, Tennessee Leased
` Lancaster, South Carolina Owned
` LaGrange, Georgia Owned
` Lexington, North Carolina Owned
` Waterbury, Connecticut Owned
` Mississauga, Ontario, Canada Leased
` International
` Aarschot, Belgium Owned
` Dongguan, China* Owned
` Gurgaon, India* Owned
` Mexico City, Mexico Owned
` Port Elizabeth, South Africa Owned
` Wrexham, Wales Leased
`
`
`- ---------------
`* Scheduled to begin commercial production in December 1996, these are joint
` venture companies in which Duracell owns a controlling interest.
`
` Duracell leases its corporate headquarters facility in Bethel, Connecticut.
`
` Duracell's management believes that Duracell's facilities are adequate for
`its operations, are in good operating condition and that its alkaline
`manufacturing plants have sufficient global capacity to meet
`
` Page 6
`
`Exhibit 1025, Page 007
`
`

`

` 7
`
`foreseeable market requirements. Duracell continues to add alkaline battery
`capacity through the procurement of higher speed assembly equipment to meet
`growing demand in the U.S. and throughout the world.
`
`ITEM 3. LEGAL PROCEEDINGS
`
` Other than ordinary litigation incidental to the battery business, such as
`product liability claims, and other than in the environmental areas described
`below, there are no significant legal or administrative proceedings to which
`Duracell is a party defendant.
`
` Duracell uses hazardous materials in its manufacture of batteries and,
`consequently, is subject to numerous national, state and local laws and
`regulations governing the use, discharge and disposal of such materials. Certain
`jurisdictions have enacted or are considering legislation regulating the heavy
`metal content of batteries. Duracell's manufacturing facilities are believed to
`be in substantial compliance with current laws and regulations, and Duracell has
`ongoing technical programs directed towards minimizing its use of hazardous
`materials. Compliance with current laws and regulations has not had, and is not
`expected to have, a material adverse effect on Duracell's financial condition.
`Capital expenditures for Duracell's ongoing environmental protection programs
`are not expected to be material to Duracell's financial condition. It is
`impossible to predict the effect which future domestic or foreign regulation
`(which could include regulation of the heavy metal content of batteries or the
`disposal of batteries or of by-products of battery production) could have on
`Duracell's business, earnings or cash flow.
`
` In September, 1994, Duracell entered into an Administrative Order by
`Consent with the U.S. Environmental Protection Agency ("EPA") whereunder
`Duracell has submitted to the EPA a plan for a complete remedial investigation
`and feasibility study ("RIFS") relating to mercury and volatile organic
`compounds contamination at Duracell's Lexington, North Carolina manufacturing
`site. The investigation work under the RIFS has been completed and certain
`supplemental investigatory activities are presently being discussed with the
`EPA. Comprehensive remediation actions have taken place at the Lexington site
`over many years, but additional remediation work will be necessary based upon
`the outcome of the RIFS. During 1996, Duracell has revised its estimates related
`to remediation costs based on additional information obtained as the
`investigation progressed. As of June 30, 1996, Duracell believes that reasonably
`estimable investigatory and remediation costs will be approximately $6 million,
`which is fully reserved. However, site investigation is not yet complete and the
`remediation plan has not been agreed to by the EPA. Duracell believes that if
`additional remedial work is required, such additional remediation would not
`likely exceed an additional $10 million.
`
` In addition to the Lexington site, Duracell is also involved in several
`other environmental remediation programs. The future cost of these remediations
`is not expected to be material to Duracell's results of operations or financial
`condition.
`
`ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
`
` None.
`
` Page 7
`
`Exhibit 1025, Page 008
`
`

`

` 8
`
` PART II
`
`ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
`
` The Company's Common Stock is traded on the New York Stock Exchange under
`the symbol DUR. The number of holders of record of Common Stock at August 24,
`1996 was 6,176. The Common Stock commenced public trading on May 2, 1991 at the
`time of the initial public offering. On August 19, 1992, the Company declared
`its initial quarterly cash dividend on the Common Stock at the rate of $.08 per
`share. The quarterly dividend was subsequently increased to $.16 per share with
`the dividend paid in the third quarter of fiscal 1993, to $.22 per share with
`the dividend paid in the third quarter of fiscal 1994, to $.26 per share with
`the dividend paid in the third quarter of fiscal 1995 and to $.29 per share with
`the dividend paid in the third quarter of fiscal 1996. The closing price of the
`Common Stock on September 13, 1996 was $62 27/64 per share.
`
` The high, low and closing prices for a share of Duracell common stock on
`the New York Stock Exchange for each fiscal quarter of 1996 and 1995 were as
`follows (in dollars):
`
`
`
` HIGH LOW CLOSE
` ---- --- -----
`
` 1996
` Fourth Quarter................................................ 50 1/4 41 3/4 43 1/8
` Third Quarter................................................. 54 44 7/8 49 5/8
` Second Quarter................................................ 55 44 7/8 51 3/4
` First Quarter................................................. 47 3/8 41 3/8 44 7/8
` 1995
` Fourth Quarter................................................ 47 41 7/8 43 1/4
` Third Quarter................................................. 45 3/8 36 3/4 44 3/4
` Second Quarter................................................ 46 40 3/4 43 3/8
` First Quarter................................................. 47 1/4 39 45 5/8
`
`
`ITEM 6. SELECTED FINANCIAL DATA
`
` The information set forth in Note 19, Selected Financial Data, which
`appears on page 55 of the Annual Report to Shareholders for the fiscal year
`ended June 30, 1996 is incorporated into this Report by reference thereto.
`
`ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
` OF OPERATIONS
`
` The information set forth under the heading "Financial Review" on pages 32
`to 41 of the Annual Report to Shareholders for the fiscal year ended June 30,
`1996 is incorporated into this Report by reference thereto.
`
`ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
`
` The Company's consolidated financial statements, independent auditors'
`report thereon and supplementary data on pages 42 to 56 of the Annual Report to
`Shareholders for the fiscal year ended June 30, 1996 are incorporated into this
`Report by reference thereto.
`
`ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
` FINANCIAL DISCLOSURE
`
` None.
`
` Page 8
`
`Exhibit 1025, Page 009
`
`

`

` 9
`
` PART III
`
`ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
`
` DIRECTORS AND EXECUTIVE OFFICERS
`
` The directors and executive officers of the Company, their ages and their
`employment history are as follows:
`
`
`
` PRESENT PRINCIPAL OCCUPATION
` OR EMPLOYMENT AND FIVE-YEAR
` NAME AGE EMPLOYMENT HISTORY
`- ------------------------- --- -------------------------------------------------------------
`
`Earnest J. Edwards....... 58 Director of the Company since October, 1995; Vice President
` and Controller, Aluminum Company of America.
`C. Robert Kidder......... 52 Director of the Company since June, 1988; Chairman of the
` Board and Chief Executive Officer, Borden, Inc. since
` January, 1995; Chairman of the Board and Chief Executive
` Officer of the Company and Duracell Inc. from April, 1992
` until January, 1995 and October, 1994, respectively; Chairman
` of the Board, President and Chief Executive Officer of the
` Company and Duracell Inc. from August, 1991 until April,
` 1992.
`Charles E. Kiernan....... 51 Director of the Company since October, 1994; President and
` Chief Operating Officer of the Company and Duracell Inc.
` since Jan