Document 9J4GJkNygrgQeNG2e0ddjZKp5

PLAINTIFFS EXHIBIT KM-26 BRIEF HISTORY OF KELLY-MOORS'S PACO DRY WALL DIVISIONS PRODUCTION AND SALES : The Paco Textures Corporation TU founded la 1938, and located la Richmond, California. It manufactured dry wall Joist core pounds and vail textures, and sold to distributors principally la Hortbera California, of which Xelly-Moore was the largest distributor. Za December 1960, X-tf purchased all of tbe outstanding stock ot the Paco Textures Corporation and Clifford Woodland, Presi dent of the paeo Textures Corporation, Joined telly-tfoore as General Uanagar of Its Paco Textures Division. The corpora tion was later merged into Eelly-Moore, aad for a period of approximately tea years, %e continued to sell distributors la the 8ay Area and Xelly-tfoore sold Paco produets direct through Its own stores la Increasing volume. The stock purchase agreement is silent concerning E-U*s liability for the company's past operations; therefore, could be responsible for product liability during that three year period prior to our acquisition of the company. Za 1963, we sored part of the equipment from the Richmond, California plant to our Dallas, Texas paint factory, and began manufacturing the same type of dry wall produets for sale in the southwestern area through Selly-Uoore stores. Ts 1964, we moved the aanufacturing facility from Richmond, California to San Carlos, California, aad enlarged the opera tion at this time. Za 1967, we set up a dry wall aanuf acturing operation at Houston, Texas, in order to be sore competitive In that market. This operation continued until 1974, at which time we. closed the operation and supplied the Houston area from our Hurst, Texas plant near Dallas. Za 1968, we added a dry wall manufacturing facility to our Ontario, California paint factory aad supplied products to the Southern California area from this plant. This operation was closed is 1973, and we continued to supply products for sale is tbe Southern California area from our San Carlos factory. Za 1969, we opened a dry wall manufacturing facility at Tulsa, Oklahoma, aad sold these products principally to distributors is tbe Oklahoma, Arkansas and tansas area. Za 1973, we moved the Tulsa facility to a new asd larger plant is Broken Arrow, Oklahoma, which is a suburb of Tulsa, Oklahoma.. X j -j. > 3S This pi amt continued io operation through 137?,' at which time wo discontinued the use of asbestos in our products. Its sales wore through Kelly-Uoore stores sad distributors ia the Okla homa, Arkansas, Tennessee, Kansas and Missouri areas. Is 1969, we added s dry wall produet manufacturing facility to our Kirkland, Washington paint factory. This facility supplied products to the t-U stores la the Pacific-Northwest-area, and also sold a few distributors. This facility 'as closed la 1973 due to lack of sufficient volume, and the Saa Carlos plaat supplied products to the Pacific-Northwest area after that . date, . Za 1970, the Dallas paiat factory aad dry wall aaouf acturiag facilities were sowed to a new aad larger plaat at Burst, Texas, which is fifteen ailes west of Dallas, This plant has continued to saaufacture dry wall products siace that date. Is 1971, we added a dry wall product aaaufacturiag facility to our Dearer, Colorado paint factory which supplied produets principally to our stores la the Bocky Mountain area. This facility was closed la 1976, and these products are sow supplied from our Burst, Texas facility. Za summary, during one period, K-M had seven dry wall aaaufacturing facilities ia operation. Due principally to lacreased competition aad uosatisfactery profit margias, four facilities were closed aad the Broken Arrow, Oklahoma facility was sold January 1, 1979. This left K-U with two facilities; at Saa Carlos, California aad at Burst, Texas, which are currently supplying Paco dry wall products for sale, principally (over 9SS) through K-U stores. Addltlosal Information on the use of asbestos la Paco dry wall products: 1, Our suppliers of asbestos fibers *;: a. Johns-tfaaville Sales Corporation, Greenwood Plasa, Denver, Colorado S0217 b. Onion Carbide Cor?., P.0. Box 4115, Church Street, New Torh City, N.T. 10006 c. Carey Canadian Mines Co., Limited, Bast Broughton Station, Quebec, Canada We estimate approximately 20S of our purchases were from Johss-tfaaville; 6% from Onion Carbide and 72S from Carey Canadian. 3. The principal use of these products wan in new construction aad applied by professional applicators. ' 2 3. Our sales figures in the data sheets are overstated because of intercompany sales inclusion in some of the sales re ports. 4. Although complete information is not available, e estimate that the total number of employees that worked in all of our Paco manufacturing facilities from 1960 through 1973 (last date asbestos was used) would be approximately 240. Starting la 1972, we had pre-placement physical examina tions os new.employees, aanual physical examinations oo all employees, affd exit physical examinations os all employees who terminated.' All of these examinations included chest x-rays, and a copy of the examination specifications is attached. Curing this time, we have bad only one employee, Lloyd Bowers, that had a "spot" os his x-ray. This was watched for several years until his retirement in Decem ber 1979, There was so apparent growth aod it was not diagnosed as asbestosis. Ose other employee worked for Paco during the period 19S9-1964. A Yorkers* Compensation claim was filed Is 1981 by his attorsey, requesting payment of his medical treatment costs which, according to the information we have, amounts to less than 31,000 aod are -3