Document B535Q1YwLGmebrD85aKLKZGe4

PLAINTIFF'S EXHIBIT CERTAIN-TEED PRODUCTS CORPORATION PIPE & PLASTIC GROUP P.O. Box 660 Valley Forge, Pa. 19482 2151687-5000 CERTAINTEED January 8, 1976 TO: Messrs. F. T. Duffy, The Flintkote Company H. R. Fraser, Canadian Johns-Manville Co., LTD R. Perrell, Cement Asbestos Products Company E. W. Spinzig, Johns-Manville Sales Corporation J. C. Jackson, A/C Pipe Producers Association J. Welsh, A/C Pipe Producers Association Subject: FINAL TEST REPORT - UTAH STATE UNIVERSITY Attached is a copy of the final report prepared by Utah State University. Please review this report and be prepared for an AD HOC Committee Meeting on January 27, 1976 at the Marriott Inn, 4277 W. 150th St. at the Cleveland, Ohio Airport at 9:00 a.m. Agenda for the Meeting 1. Call to Order 2. Review of Final Report 3. Acceptance/Rejection of Report 4. Review of items to be included in a draft ASTM D-428 5. Design criteria for A/C Pipe 6. Plans for operation within ASTM 7. New Business 8. Close In the meantime, I will ask John Welsh to handle the details with the WPCF using the abstract enclosed. Very truly. -'Alvin I. Leff AIL/ajl Enc. i r CAPCO JEN 0023338 CAPCO JEN 0023339 feijfh ai)ijual nieefins & Industry conference revised prosranj Welcome to the Tenth Annual Meeting and Industry Conference of the A/C Pipe Producers Association. This Revised Program contains the final time, location and speaker changes for all business and social functions. We recommend that you read through the material and familiarize yourself with it. With a full schedule and much business to discuss, all meetings and program sessions will begin promptly. Since some of you will be meeting for the first time, it is requested that name badges be worn at all regularly scheduled events. If you have any questions or need any assistance during the Annual Meeting, please feel free to contact AACPP Staff. Once again, welcome to Cancun and enjoy your stay. i CAPCO JEN 0023340 vista '82 MONDAY MAY 3,1983 Session I A/C Pipe Supply-Demand 9:00 a.m. WELCOMING REMARKS Lloyd C. Ambler AACPP Chairman 9:20 a.m. ECONOMIC OUTLOOK: U.S. --^ Margaret A. Timothy Vice President Planning & Marketing Research CertainTeed Corporation 10:00 a.m. MARKET OUTLOOK: U.S. John L. Fischer Vice President & General Manager Pipe Division Johns-Manville Corporation 10:20 a.m. Coffee Break 10:40 a.m. RESIN OUTLOOK: U.S. Manfred Timpe President--Pipe & Plastics Division CertainTeed Corporation 11:00 a.m. FIBER OUTLOOK: U.S. Warren Whitley President CAPCO Pipe Company, Inc. 11:20 a.m. ROUNDTABLE I Moderator: I. Lee Taylor AACPP Vice Chairman 12:00 noon Adjourn TUESDAY MAY 4,1982 SESSION n A/C Pipe Supply-Demand 9:00 a.m. OPENING REMARKS Etienne van der Rest Chairman AACPP International Affairs Committee 9:20 a.m. REGULATORY OUTLOOK: E.E.C. Etienne van der Rest Chairman S.A. Eternit 9:40 a.m. MARKET OUTLOOK: E.E.C. Bernard Giboin Director of Fiber Purchases & International Relations Everitube 10:00 a.m. MARKET OUTLOOK: GERMANY Robert W. Dorner Executive Secretary S.A.I.A.C. 10:20 a.m. Coffee Break 10:40 a.m. MARKET OUTLOOK: MEXICO Luis Cejudo Alva General Manager A.M.F.A.C. 11:00 a.m. MARKET OUTLOOK: FAR EAST Harry A. Hudson Executive General Manager James Hardie & Company, Pty., Ltd. 11:20 a.m. ROUNDTABLE II Moderator: Etienne van der Rest Chairman S.A. Eternit 12:00 noon Adjourn CAPCO JEN 0023341 WEDNESDAY MAY 5,1982 Session m Programs & Perspectives 9:00 a.m. OPENING REMARKS Joseph C. Jackson President A/C Pipe Producers Association 9:20 a.m. REGULATORY OUTLOOK: U.S. John F. Welch Vice President A/C Pipe Producers Association 9:40 a.m. MUNICIPAL ANALYSIS PROGRAM G. Wade Miller AACPP Consultant 10:00 a.m. AACPP PROGRAM UPDATE John F. Welch AACPP 10:20 a.m. Coffee Break 10:40 a.m. STATE OF THE INDUSTRY Joseph C. Jackson AACPP 11:00 a.m. Adjourn j 'j notes CAPCO JEN 0023342 schedule of events SUNDAY, MAY 2, 1982 12:00 noon 6:30 p.m. - 8:00 p.m. MONDAY, MAY 3, 1982 8:30 a.m. - 3:30 p.m. 9:00 a.m. - 12:00 noon 1:30 p.m. - 5:00 p.m. 7:00 p.m. - 11:00 p.m. TUESDAY, MAY 4,1982 9:00 a.m. - 12:00 noon 1:30 p.m. - 5:00 p.m. ARRIVALS Hotel Check-in Welcoming Reception Indoor Pool WEDNESDAY, MAY 5, 1982 9:00 a.m. - 11:00 a.m. if Industry Conference Session III Salon Gontoy/Cozumel Spouses Program Indoor Pool Industry Conference Session I Salon ContoyyCozumel Joint PAC/TAC Meeting Salon Contoy Fiesta Mexicana Outdoor Pool 11:00 a.m. - 12:30 p.m. 1:00 p.m. - 5:00 p.m. Brunch _ bubbv Turf Golf Tournament Pok-Ta-Pok Golf Course 1:00 p.m. - 5:00 p.m. Tennis Tournament Cancun Sheraton Tennis Courts 7:00 p.m. - 12:00 midnight Dinner-Dance Cocktails at Jardines Terraza Dinner at Salon Cancun/Cozumel Industry Conference Session II Salon eontoy/Cozumel THURSDAY, MAY 6, 1982 9.90 a.m. - 1:00 p.m. Board of Directors Meeting Salon Cancun IAC Meeting Salon Contoy A CAPCO JEN 0023343 attendees AACPP Staff Ms. Angela J. Bayless (Angie) Executive Assistant Mr. & Mrs. Joseph C. Jackson (Joe & Shirley) President Mrs. Mary M. Jackson Staff Assistant Mr. John F. Welch Vice President Mr. Arthur H. Kahn (Art) AACPP Counsel Schnader, Harrison, Segal & Lewis Mr. & Mrs. George E. Rahn, Jr. (Ned & Elena) AACPP Counsel Schnader, Harrison, Segal & Lewis Mr. & Mrs. G. Wade Miller (Wade <5c Joyce) AACPP Consultant Wade Miller Associates, Inc. REGULAR MEMBERS Asbestos de Mexico. S.A. Mr. & Mrs. Barry Cooper (Barry & Maria Mercedes) Board of Directors, Asbestos de Mexico, S.A. Mr. & Mrs. Jose Grinda (Jose & Luz Maria) General Director Mr. & Mrs. Enrique Romero (Enrique & Alexandra) Technical Advisor Asociacion Mexicana de Fabricantes de Productos de Asbesto-Cemento (A.M.F.A.C.) Mr. (c Mrs. Luis Cejudo Alva (Luis & Luz) General Manager * AACPP Board Member > CAPCO Pipe Company, Inc. Mr. & Mrs. William R. Perrell (Bill <5c Pat) Vice President, Sales Mr. & Mrs. I. Lee Taylor (Lee & Susan) Vice President, Marketing AACPP Vice Chairman & Board Member Mr. & Mrs. Warren Whitley (Warren & Eleanor) President CertainTeed Corporation Mr. & Mrs. Lloyd C. Ambler (Lloyd & Mary) Senior Vice President, National Sales AACPP Chairman Jc Board Member Mr. & Mrs. Jay F. Baker (Jay <5c Wylene) Vice President & General Manager, A/C 40 Mr. & Mrs. John P. McGinley (John & Betty) Vice President, A/C Pipe Operations Dr. Margaret A. Timothy (Agnes) Vice President of Planning & Market Research Mr. & Mrs. Manfred Timpe (Fred & Inge) President, Pipe & Plastics Division CAPCO JEN 0023344 Grupo Eureka Mr. & Mrs. Joaquin Garcia Suarez (Joaquin <5e Maria del Carmen) Commercial Director Johns-Manville Corporation Mr. & Mrs. John R. Cran (Jack <Sc Ruth) Merchandising Manager, Pipe AACPP Treasurer & Board Member Mr. John L. Fischer Vice President <5c General Manager, Pipe Division Mr. Hal L. Olson Manager, Environmental & Product Development Mr. Alan A. Verploegh & Ms. Ann Peters Market Manager, Western U.S.A. Mexalit del Norte, S.A. Mr. & Mrs. Daniel Castro (Daniel & Maria Eulalia) Research & Development Manager Mr. <5c Mrs. Policarpo Martinez (Policarpo & Hortencia) Director ASSOCIATE MEMBERS Association de Ilndustrie I'Asbeste-Ciment (S.A.I.A.C.) Mr. & Mrs. Robert W. Dorner (Bob & Ruth) Executive Secretary Eternit France Mr. Jean-Guy Cuvelier Director General S.A. Eternit Mr. & Mrs. Etienne van der Rest (Etienne & Eliane) *" Chairman ** Everitube Mr. & Mrs. Bernard Giboin (Bernard & Francoise) Director of Fiber Purchases <5c International Relations Hellenit, S.A. Mr. & Mrs. Anthony Saoulis (Anthony <fc Angela) President & Managing Director Hyderabad Asbestos Cement Products Ltd. Mr. Vangala Pattabhi (Pat) Manager, A/C Division James Hardie & Company, Ptv,, Ltd. * Mr. & Mrs. Harry A. Hudson (Harry & Evel) j Executive General Manager l Kuwait Asbestos Industries Mr. Salah A. Al-Tarkait Deputy Managing Director CAPCO JEN 0023345 GUESTS Calaveras Asbestos Ltd. Mr. <5c Mrs. Gordon A. Coats (Gordon & Tere) President & General Manager Mr. & Mrs. Daryl Larsen (Daryl & Mary) Treasurer Special Materials. Inc., Illinois Mr. & Mrs. Richard C. Wareham (Dick & Rita) President ** l CAPCO JEN 0023346 V.* - ' - ::. T^-' v {- r\ - -'-- fy/.A;. ;.^j-;s,..-. c -'r.i _ ! v ' ' . _.v' A/C * PIPE PRODUCERS ASSOCIATSCIl.c,O.y^',.rN. M.vr-*.J Suite 1113 1875 Connecticut Avenue, N.W. Washington, D.C. 200p9.,;^^ i' T * s '. "... a world-wide trade association that ' unifies the talents, technical disciplines and resources' of the international community of Asbestos-Cement Pipe Producers.'' CAP CO JEN 0023347 </./ `i*r ,?;> I . ,rv: ,. ' frr- 'x/--- > -- CAPCO JEN 0023348 More than sixty years ago an industry was born. The industry: Asbestos-Cement Pipe for the underground conveyance of liquids for both pressure and non-pres sure uses, as well as utility conduit and other piping applications. Sixty years ago in Italy a pipe was needed that could be used to carry salt water, under pressure, from the sea to coastal towns for fire pro tection and washing down the streets of municipalities. Piping materials were available, of course, but, none that could withstand the corrosive reaction of salt water for long periods of time. An Italian company, Societa Anonima Eternit Pietra, solved the problem by combining asbestos fiber with cement, under pressure, to produce an integrally reinforced pipe that would resist corrosion, accept high pipeline pres sures, and in addition was light in weight, an advantage inherent in all A/C pipe. This new product provided the city of Genoa with a long life underground water transport system. From this origin, the use of Asbestos-Cement Pipe has become popular throughout the world. There are more than 200,000 miles of Asbestos-Cement water pipe in the United States, enough to literally "lay a pipeline to the moon." If the footage of all other types of A/C pipe in service was included, one pipeline could carry fresh water to the moon and a second line return non-potable waste water to the surface of the earth. Throughout the world there are over 1,500,000 miles of Asbestos-Cement water pipe in the ground. 3 1 'i CAPCO JEN 0023349 The "Problem Solver" Among Pipes The world-wide use and acceptance of Asbestos-Cement pipe is no accident. A/C pipe provides customers with economical solutions to problems which have consistently, over the years, plagued under ground piping installations. corrosion resistant high strength 1. Asbestos-Cement pipe is resistant to corrosion both internally and externally. This has been demonstrated by tests run by the U.S. Bureau of Standards on buried samples and by the U.S. Bureau of Mines through tests conducted using corrosive mine drainage water. Actual usage has confirmed these findings many times over. 2. Asbestos-Cement pipe has high strength to withstand the high internal hydrostatic forces imposed by water hammer and external shock loads from earthquakes. clean, tight joints light in weight smooth bore 3. Asbestos-Cement pipe contributes to high quality water. A/C Pipe cannot rust causing water discoloration. Asbestos-Cement Pipe producers pioneered the concept of rubber ring joints; joints that contain no jute which offered a focal point for bacterial growth. This same "bottle tight" joint prevents infiltration and exfiltration in sewage installations. 4. Asbestos-Cement Pipe is light in weight and easy for the contractor to install resulting in lower installation and transportation costs. 5. Asbestos-Cement Pipe has a permanently smooth interior wall which means lower pumping costs. These are the major factors that have made Asbestos-Cement Pipe one of the most widely used piping materials in the world today. 2- i 'i CAPCO JEN 0023350 The Industry Challenge and The A/C Pipe Producers Association The acceptance and use of Asbestos-Cement Pipe has paralleled the ever increasing and universal demand for economical, efficient and reliable water and sewer systems. Borderline product performance criteria are no longer tolerated. National, regional, and local standards are being reviewed and updated continually to reflect the latest product requirements and environmental guidelines. New advanced technol ogies are emerging to answer many of today's sophisticated and com plex problems which result from the growing demand for water and sewer needs. Technical and educational information is constantly sought by news media, governmental agencies, engineering firms, colleges and universities. Broad-based application and product needs require industry-wide solutions. These are but a few of the many chal lenges that are recognized by the growing A/C Pipe industry today. How are these challenges met? The answer: By a world-wide trade association that unifies the talents, technical disciplines and resources of the international community of Asbestos-Cement Pipe Producers, an Association that can provide an informational center to effectively and professionally serve the industry, the technical and governmental community and the general public. To fulfill this need the A/C Pipe Producers Association (AACPP) was organized and incorporated in September 1972. Today the Association maintains a fully staffed office in Washington, D.C. North American Members of AACPP include: Asbestos De Mexico, S.A., Mexico City, Mexico* Atlas Asbestos Co., Montreal, Canada Canadian Johns-Manville Co., Ltd., Ontario, Canada* Cement Asbestos Products Co., Birmingham, Alabama* Certain-teed Products Corp., Valley Forge, Pennsylvania* The Flintkote Company, Akron, Ohio* Johns-Manville Sales Corp., Denver, Colorado* Mexalit Del Norte, S.A. Mexico City, Mexico* World-Wide Associate Members Include: Association De L'lndustrie L'Asbeste-Ciment, Nyon, Switzerland Amiantus Centre Export, Hamburg, Germany James Hardie & Co. Pty. Ltd., Sydney, Australia Hellenic Industry for Building Materials "Hellinit" S.A. Athens, Greece Paraisten Kalkki Oy, Pargas, Finland ^Charter Members 3 THE ANSWER ... a trade association world-wide in scope AACPP western hemisphere world-wide members i CAPCO JEN 0023351 involvement data bank Association Activities Standards: The A/C Pipe Producers Association is committed to main taining a complete file of national and international specifications, standards, and engineering design criteria pertinent to the manufacture, testing, application and use of Asbestos-Cement Pipe. AACPP actively participates in the initiation, development, maintenance and promul gation of product performance standards for national and international use. The association catalogues, in its library, all ancillary and com petitive specifications. The A/C Pipe Producers Association function as a responsive, authori tative source of information for the many specification writing organi zations, as well as all regulatory and governmental agencies and the engineering community as a whole. In performing this function, the association membership contributes time and talent on a regular and continuing basis in support of staff activities. Washington headquarters serves as a clearing house for all specification standards and supporting data that are developed. This data is made available to member com panies, governmental and regulatory agencies, technical societies, na tional, international, and regional associations and the world-wide community of consulting engineers and public utility officials who specify and use water and sewer pipe. Technical Services--The A/C Pipe Producers Association initiates and coordinates technical assistance and educational programs to provide responsible answers to problems whose scope, complexity, or unique ness represent an industry rather than an individual member com pany's responsibility. In its role as an informational source and an information center, AACPP compiles technology data banks which serve as comprehensive refer ence sources on virtually every aspect of A/C Pipe; from raw materials to product end uses and performance. This data, like industry stand ards, are published in Association Bulletins on a continuing basis. When knowledge gaps exist, AACPP through its technical committee activ ities underwrites appropriate investigations and studies to develop the required information. These initiatives run the gamut from comprehensive literature surveys to long range research grants and contracts. Through its technical service and function the A/C Pipe Producers Association makes available to users of A/C Pipe authoritative infor mation to assist them in their design and application needs. To effec tively perform this service the Association is continually soliciting, reviewing and assessing new informational sources and compiling this information into a current technical library. D 4 CAPCO JEN 0023352 Industry promotion--It is the fundamental objective of the A/C Pipe Producers Association to promote the world-wide acceptance of and confidence in Asbestos-Cement Pipe. This is being accomplished in many ways: The Association systematically conducts both in-house and independ ent market surveys to keep abreast of new product uses, new applica tion needs, as well as changing design criteria and performance re quirements. Survey activities are supplemented by a close working liaison with all major segments of the piping fraternity. Coupled with statistical reporting programs these informational inputs are consoli dated and passed along by AACPP to member companies to aid in planning better ways by which the A/C Pipe industry can serve exist ing and potential customers. statistics The A/C Pipe Producers Association periodically publishes authorita tive bulletins related to recognized product attributes of A/C pipe and their applicability to specific in-use markets. All publications are thoroughly researched and reviewed for relevancy and accuracy. Many association bulletins contain detailed technical data and references essential to the evaluation and selection process. Companion Association literature offering an industry over-view of non-technical matters common to water and waste water systems, regardless of the materials of construction used, is frequently released as a public service. Similarly, AACPP via knowledgeable staff or industry personnel, pre pares and distributes technical reports encompassing a variety of highly technical subjects, a better understanding of which will help to ad vance the state of the art. Forums in which Association information of this nature is disseminated include technical society meetings, national and international con ferences, college and university extension programs, and not infre quently public appearances before governmental bodies, municipalities and public interest groups. presentations 5 CAPCO JEN 0023353 exhibits The association regularly participates in national trade shows and exhibitions. Collectively manned by both experienced staff and member company personnel, AACPP exhibits provide a convenient, interesting "on the spot" opportunity to learn first hand how the A/C pipe industry has gained world-wide acceptance of and confidence in its piping products. pride Utilizing a variety of media, the promotional activities of the A/C Pipe Producers Association are critically designed to present the case for Asbestos-Cement Pipe in a proud, straight-forward, ethical and pro fessional manner. commitment Financial--The A/C Pipe Producers Association is a non-profit trade association with the committed function of gathering and disseminating factual and meaningful information on the Asbestos-Cement Pipe In dustry and its products. All funds are used to that end. administration Organization--The A/C Pipe Producers Association is governed by a board of directors comprised of one voting representative from each qualified member company. Officers are elected annually. AACPP maintains a full-time executive director and staff at its Washington, D.C. headquarters. 6 i' CAPCO JEN 0023354 Serving the Community The A/C Pipe Producers Association represents leading manufacturers of Asbestos-Cement pipe throughout the world. The industry is respon sible for millions of miles of pipe used for the transmission and distri bution of potable water and the collection and disposal of non-potable waste waters. This is an enviable testimonial to the world-wide accep tance and use of A/C Pipe. The Association acknowledges its steward ship obligation to honor this community trust and preserve the en vironment in which it exists. Environment--Environmental affairs are a joint responsibility of every AACPP committee and each individual member company. The A^C Pipe Producers Association is committed to promoting a clean environ ment. There is no environmental problem too small to not be of major concern. The Association's commitment is to maintain at all times a safe, healthy environment for all of its employees and cus tomers. AACPP has mobilized all of its resources to take prompt and proper remedial action when necessary to meet new environmental standards. A self-policing action by member companies is policy; assuring in many instances compliance with federal legislation and guidelines estab lished by law in advance of their effective dates. self-policing To accomplish this, continual contact is maintained with responsible governmental agencies. Through workshop/seminars the Association provides continuing in formational and educational programs for both the consumer and manufacturer. workshop seminars The A/C Pipe Producers Association has, and will continue to, approach environmental issues in a forthright, unbiased and objective manner by contracting with outside agencies and underwriting independent research studies. Results of this work are periodically published in definitive documents and distributed as a public service to industry, the technical and engineering community, health agencies, govern mental and regulatory agencies, the consumer and other concerned groups. independent research 7 CAPCO JEN 0023355 Product Application Pressure Pipe Used for the transmission and distribution of potable and non-potable liquids under pressure. A complete line of pressure pipe is available in small and large diameters for use in serving residential, rural, municipal, industrial, agricultural and recreational markets. Non-pressure Pipe Used for the collection, transmission and disposal of primarily nonpotable waste and run off liquids under gravity flow or non-pressure conditions. A complete line of non-pressure pipe is available in large and small diameters for use in serving residential, rural, municipal and other markets. Q) 8' ii CAPCO JEN 0023356 \v product inquiries The A/C Pipe Producers Association functions as a non-profit, non-partisan world-wide trade association on behalf of the" A/C Pipe industry. Inquiries for information on products, their individual attributes and differences, . ' ......... -'".': 'r: should be directed to member companies. '"V`\ :V "'v `.A'-'-V. HS''> . ' "ft, ' ? -S Ti '1 ;... association information A/C Pipe Producers Association is a world-wide trade association serving as a central information center on all areas of A/C Pipe. Additional copies of this bulletin may be obtained without charge by writing: A/C Pipe Producers Association Suite 1113 1875 Connecticut Avenue, N.W. Washington, D.C. 20009 * V -!Iv I' CAPCO JEN 0023357 :vr ' ' '."; '. ...y 'I-.'-" i-' i ;:vv> m . *i- , . * r/"V A/C PIPE PRODUCERS ASSOCIATION. Suite 1113,1875 Connecticut Ave.,N.W. 'V--- Washington, D.C. 20009 ATLAS ASBESTOS CO. Montreal, Canada ASBESTOS DE MEXICO, S.A. Mexico City, Mexico CANADIAN JOHNS-MANVILLE CO., LTD. Ontario, Canada CEMENT ASBESTOS PRODUCTS CO. Birmingham, Alabama . ,.-/, , . . *_ r: ^ ? -fMV'&f'V ... -v CERTAIN-TEED PRODUCTS CORP. Valley Forge, Pennsylvania THE FLINTKOTE COMPANY Akron, Ohio , JOHNS-MANVILLE SALES CORP. Denver, Colorado MEXALIT DEL NORTE, S.A. Mexico City, Mexico '- - ASSOCIATION DE LTNDUSTRIE L'ASBESTE-CIMENT Nyon, Switzerland AMIANTUSCENTRE EXPORT Hamburg, Germany JAMES HARDIE & CO. PTY., LTD. Sydney, Australia - -i.1 HELLENIC INDUSTRY FOR BUILDING MATERIALS "HELLENIT" S.A. Athens, Greece PARAISTEN KALKKI OY Pargas, Finland .. . - - ,^y-' CAPCO JEN 0023358 ; _ . r A/C PIPE PRODUCERS ASSOCIATION Suite 1113 1875 Connecticut Avenue, N.W. . Washington, D.C. 20009; tl" ` '; "... a world-wide trade association that.. unifies the talents, technical disciplines and resources of the international community c of Asbestos-Cement Pipe Producers." CAPCO JEN 0023359 The undersigned. Association of Asbestos Cerr.ent Pipe Producers ("AACPP"), a nonprofit Pennsylvania corporation, Inter-Associates, Inc. ("IAI"), a Virginia corporation, Joseph C. Jackson, a resident of McLean, Virginia, and John F. Welch, a resident of Arlington, Virginia, hereby agree as follows: ARTICLE I TRANSFER OF ASSETS 1. Subject to the terms and conditions of this Agreement, at the Closing AACPP will convey, transfer, assign and deliver to IAI and IAI will acquire the following assets of AACPP existing on the Closing Date (all of which assets are hereinafter collectively referred to as "Assets"): a. Personal Property. All equipment, vehi cles, furniture, fixtures, books, supplies and other similar personal property owned by AACPP, which shall include, without limitation, all of the personal property listed in Exhibit A attached hereto; provided, however, that all financial and ac counting records and other permanent files and records of AACPP shall remain the property of AACPP. b. Cash; Accounts Receivable. All cash on hand, bank deposits and interest bearing instruments owned by AACPP at the Closing Date, except for the-, sum of one hundred i CAPCO JEN 0023360 Thousand dollars ($100,000.00), a no all accounts receivableowing to AACPP as of the Closing Dave including, wirhout. linratation, all such accounts receivable reflected in its April 30, 1S82 balance sheet, attached hereto as Exhibit B, or thereaf ter created and nor in either case collected by AACPP or other wise liquidated prior to the Closing Date. c. Contracts. All right, title and interest of AACPP in, to and under all executory contracts and other agreements of AACPP relating to irs business, excluding how ever, contracts which are nonassignable, as to which AACPP shall use its best efforts to obtain any consents necessary to effect an assignment. d. Unpaid Dues. All right, title and inter est to all dues received by AACPP from Associate and A.ffiliate members during 1982 subsequent to the Closing; provided, how ever, that if the total dues received by AACPP from such mem bers during the year 1982 exceeds the amount budgeted on Ex hibit C, AACPP shall be entitled to a credit in the amount of such excess. e. Prepaid Expenses, Security Deposits and Cash Surrender Values. All right, title and interest to all repayments, refunds or return of prepaid expenses, security deposits and cash surrender values in connection with leases of real estate and equipment and insurance policies. 2- - i i CAPCO JEN 0023361 2. IAI will acquire no title zc, rights in, or authority ro use, other than with AACFP's approval, any trade marks, trade names, logos or copyrights owned by AACPP. 3. At the Closing AACPP shall deliver to IAI ap propriate documents of such kind and character as may be nec essary to effect or evidence the conveyance, assignment and transfer of the Assets. Said documents, if required or per mitted to be recorded, shall be in appropriate form for re cording under the laws of the szates where the A.ssets are lo cated. AACPP, on the Closing date, shall place IAI in full possession and enjoyment of the A.ssets. 4. Prior to or immediately following the Closing, AACPP will purchase a certificate of deposit or other interest bearing instruments in the amount of one hundred thousand dol lars ($100,000.00) and will maintain such amount in a certifi cate of deposit or other interest bearing instruments during the period from the Closing through January 3, 1983, at which time such amount and all interest accrued thereon shall be paid by AACPP to IAI in payment for services to be provided by IAI in 1983 as provided in this Agreement. 5. Following the Closing, each party shall deliver to the other party, such other instruments, documents and con sents, duly executed, as may be necessary to evidence and ef fectuate the assignments and transfers to be made hereunder. -3i i CAPCO JEN 0023362 ASSUMPTION OF LIABILITIES AND OBLIGATIONS 1. IAI hereby agrees, effective upon The Closing, to assume and pay or discharge the following liabilities and obligations of AACPP to the extent that they have not been satisfied prior to the Closing: a. all liabilities and obligations of AACPP which are shown on or reserved against in Exhibit B; b. all liabilities and obligations of AACPP in respect to contracts and commitments which, consistent with generally accepted accounting practice, would not properly be shown on or reserved against in Exhibit B, but are recorded in the conventional financial records of AACPP; c. all liabilities and obligations of AACPP arising after April 30, 1982 and prior to the Closing Date and recorded in the conventional financial records of AACPP; d. any and all state, federal and local taxes for all periods prior to the Closing Date and all taxes and transfer costs payable as a result of the transactions contem plated herein. 2. IAI, Joseph C. Jackson and John F. Welch war rant that they are not aware of any pending or threatened lit igation, claims, assessments or other actual or potential -4- i CAPCO JEN 0023363 -5- Material A/C Diameter (inches) 3 4 6 8 12 16 Total A/C Number of Miles 0.8 16.55 308.43 610.44 255.11 50.96 1242.29 PVC Cast Iron 2 0.73 4 2..81 Total PVC 2 3 4 6 8 10 12 16 20 24 30 36 3.54 1008.58 12.91 90.47 655.01 821.88 8.99 314.62 107.46 85.97 73.62 14.52 6.12 Total Cast Iron 3200.15 The remainder of the system is transmission lines, 55.7 miles of concrete and 15.23 miles of steel. Cast iron comprises about 70.8% of the total T&D system while A/C accounts for 27.5%. The Department has an active main replacement program, the objective being to get rid of the 2-inch Cl. They have expended $30-40 million per year since 1978. In fiscal year 1982-83, the Water Division will spend $10-20 million. Some of these funds will go to replace larger diameter lines (12-, 16-, and 20-inch). Asked what construction material would be used, Schwing said, "If I have anything to do with it, the replacement material will be A/C." One replacement job planned for this year is a 3-mile section of 24-inch line. Though the largest A/C pipe in the system currently is 16-inch, Schwing would like to use A/C on this job. The trend in pipe use is difficult to discern. Schwing is an open advocate of A/C. Emerick Jacobs, Manager of the Main tenance Section which repairs more than 20,000 leaks and breaks per year, also favors A/C. Pete Fortin,'-the Engineering Director, views PVC as "a Godsend" and feels A/C has "served its purpose" in Houston. CAPCO JEN 0023473 -6- Actual installations in 1980 and 1981 by contractors and developers provide more insight into what is actually happening: Year Size/Material Miles Installed 1980 4-inch A/C 6-inch A/C 8-inch A/C 12-inch A/C 16-inch A/C 0.77 19.93 32.08 8.79 6.23 Total 67.80 1980 2-inch PVC 4-inch PVC 0.01 0.23 Total 0.24 In 1980, the number of miles of 2-inch cast iron in the ground fell by 11.22 miles; 4-inch cast iron increased by 0.35 miles; 6-inch cast iron was reduced by 4.5 miles; and 8-inch decreased by 1.63 miles. The figures for 1981 reflect the same trend: Year 1981 Size/Material 4-inch A/C 6-inch A/C 8-inch A/C 12-inch A/C 16-inch A/C Miles Installed 1.44 26.63 52.52 30.58 9.34 Total 120.51 1981 2-inch PVC 4-inch PVC 0.47 1.66 Total 2.13 Total cast iron mileage in the ground in 1981 in sizes 2-16 inch was reduced by 4.1 miles. Cast iron showed positive gains only in 20-inch (3.94 miles) and 24-inch (5.27 miles). The numbers show that the A/C pipe usage trend in Houston is healthy; its market share needs only to be protected through aggressive marketing and public relations. Although the market for many durable goods and services is soft, Houston installed 17.85 miles of A/C pipe in January, 1982 alone. -1 CAPCO JEN 0023474. -7- With regard to PVC, the Water Division Director cited several "tremendous problems associated with it": o It is sold as an easy installation (i.e., idiotproof); therefore, contractors are hiring "idiots" to install PVC and it is virtually being thrown in the ditch. o The Department is finding it easier to break during installation. o The fact that anyone can take a drill bit and drill a hole in PVC is seen as a disadvantage. o In excavating, it is hard to determine when one hits PVC--it breaks before one realizes it. The distribution system itself has numerous problems asso ciated with it. These can be characterized as follows: o An accumulation of deferred maintenance coupled with the growth rate of the City has placed substantial pressure on the Department. It is constantly reacting to crises as opposed to initiating action. o Aggressive soil conditions, heavy annual rainfall, wet-dry cycles, seismic faults, and ground subsidence wreak havoc on the distribution system. o The backlog of leaks and breaks typically numbers over 100; the maintenance department has 39 crews working constantly and cannot rid themselves of this backlog. o Service pressure in many areas is quite low. o Extremely high water demand in the summer months puts additional pressure on an admittedly inadequate system, thereby causing more main breaks. OPERATIONS Specifications, Decisionmaking, and Procurement Purchase specifications for pipe materials are developed by the engineering department. At present, contractors (who install 90% of all pipe) can buy A/C, ductile iron, or PVC up to 16 inches. Asbestos/cement is purchased in sizes 4-16 inches. Six-inch asbestos/cement is used for "all fire hydrant branches and all other branch lines." The A/C pipe purchasing spec is one page and is quite liberal (loose) in construction. The only unusual provision requires that a testing laboratory inspect and test all pipe and ... that the pipe be tested domestically. CAP CO JEN 0023475 -8- Decisionmaking on what materials to use depends on whether the purchase is an annual contract or a main replacement job awarded to a contractor by competitive bid. The engineering department on specific jobs may rule out A/C or PVC depending on experiences and conditions. As an example, the Engineering Manager noted if a main has to go down the middle of a heavily travelled street, he will go with ductile iron. The last such job installed was 12-inch ductile iron. Purchasing of A/C occurs in three ways in Houston: 1) through an annual contract, 2) through contractors, or 3) through developers. Under the last annual contract, awarded to Utility Supply Company (a CertainTeed distributor), 160,000 feet of A/C was the estimated quantity purchased. The Mayor and City Council approved an award to Utility Supply Company for A/C pipe, cast iron fittings with gaskets, and PVC pipe. The estimated quantity of PVC pipe was 52,000 feet; 40,000 feet of this total was 2-inch. Purchase recommendations are developed jointly by engineering, maintenance, and the water division director. The primary external design consideration is the soil conditions in the City. Constantly shifting soils are a major consideration. The reasons for the shifting soils are: 1) the shrink-swell potential of the coastal plain soil, commonly called "gumbo," is much greater than most other soils. The gumbo contracts as it dries out and expands greatly when it becomes wet. Houston, with 45 inches of rainfall annually, has lots of wet-dry cycles; 2) the Gulf Coast plain is one of the most seismicly active areas in the country, with numerous faults in Harris County; and 3) the extraction of water, oil, and natural gas has caused severe subsidence in many parts of the county. The subsidence creates faults of its own thus exacerbating the natural geological fault problem. The greatest amount of subsidence has occurred at Pasadena, Texas near the Houston Ship Channel, where as much as nine feet of subsidence took place between 1943 and 1978. Another equally important soil property is corrosivity caused by electrochemical reactions. Houston's soils are extremely "hot" and corrosive. According to a study of the expected life of cast iron pipe in 29 major main replacement areas in the city, electrochemical corrosion is induced mainly by poor drainage and high shrink-swell potentials, not soil acidity. Another external design consideration is loading and beam strength. Houston purchases Class 200 A/C in 4-inch and 6-inch sizes in order to obtain additional beam strength. Class 150 pipe is purchased in the 8-16 inch size range. CAPCO JEN 0023476 -9- Internal design considerations cited include "smoothness"-- the texture of the internal wall. The Engineering Manager thinks ductile iron has several advantages: longer lengths, smoothness, and resistivity to expansiveness. Other design considerations are 1) ease of construction, 2) availability, and 3) workability (i.e., the degree of comfort with a material as perceived by laborers installing the pipe). The installers prefer A/C and PVC. Houston bought A/C initially in the mid-60's because it was a good alternative to metallic pipe. They now buy A/C (according to the Engineering Section Manager) because "it is lowest in cost." However, Fortin notes that on some jobs, PVC is lower in cost. He feels A/C may not have a future in Houston because of expansive soils. To reiterate, he be lieves A/C has "served its purpose." In the future, Fortin would like to see the City buy large quantities of PVC C-900. This view is the engineering viewpoint; it is one not shared by the Director or the Maintenance Section Manager. There are some consumer constraints on decisionmaking. Both the Quality Control Section Manager and Fortin note "lots of calls" saying "why are you trying to give us cancer (by using A/C)." Schwing has a different viewpoint. He does not feel there is. a preponderance of calls; he attributes any perceived consumer pressure as the result of City councilmen "going to Texas Municipal League meetings and getting collared by a PVC salesman." Schwing recommended talking to Jerry Newell the local J-M salesman about this problem. Installation and Testing Most water mains are installed by contractors. There are no city force installations except for minor repairs. Developers also install pipe; inside the City, costs are shared on a 50-50 basis. Outside the city, the developers pays 100% of the costs. In either case, the developer installs the pipe according to city specifications. The City actually encourages developers to do their own engineering (development of plans), apparently for efficiency reasons. Developers can get the job done twice as fast. The City furnishes pipe as part of their cost share for developments inside the city limits. Installation costs could be estimated only. The cost of installing smaller mains (6- and 8-inch) is estimated at $30 per foot total. In larger sizes, the cost averages about $50 per foot. CAPCO JEN 0023477 -10- Installation specifications were developed by the Engineering Sections and are dated November, 1971. The addenda updating the specifications is dated June, 1979. Again, this is symptomatic of Houston; they appear to run behind on every thing due to their growth and expansion. Excavation and Trenching All excavations are made using the open-trench method unless otherwise ordered by the inspector. A trench width equal to the pipe diameter plus six inches space on each side is required. The depth of the trench is "to a grade six inches lower than that indicated by the stakes." The extra six inches is provided for a special sand bedding. Depth of cover is 5 feet from top of curb on 16 inch and larger sizes and 4 feet from top of curb on 12 inch and smaller sizes. Asked why the depth is so great for large pipe given no frost line, the Engineering section Manager noted "they want to make sure it does not get hit." It is assumed he knows this is a tradeoff of safety ver sus extra load on the pipe. Bedding and Backfill The specs call for a 6-inch sand envelope around the pipe. The purpose is, of course, to combat the highly corro sive soils. Sand for bedding and backfill is supposed to be a "select sandy soil or other granular meterial free from clay lumps, organic materials or other deleterious substances and having a plasticity index of not greater than 7, with not more than 40% passing a No. 200 sieve. Houston has had trouble with this special bedding requirement. More often than not they find no sand envelope when the trench is excavated for repair or replacement purposes. They believe the contractors install the sand envelope, but cut corners by putting in a lesser grade sand. Sand (of the quality described above) is used for back filling to a depth of 18 inches below the top of the trench, compacted with water, and then filled with "dry removed material.." The only exception is under pavement, then they backfill with bank sand or cement stabilized sand. The method of final compactions is left to the discretion of the contractor. An unusual requirement made of the contractor is that he pay for the water used in compaction. To do so, he must install a meter and go through an elaborate application process for "transient water service." Since the contractor obviously charges this to the City (in his bid), this is an absurd requirement. *i CAPCO JEN 0023478 -11- Pipe Handling The specs call for careful handling of pipe and refer to unloading from railroad cars. Since most cities visited pro hibit rail shipment, it is assumed this reflects the age of the specs. Chlorination and Hydrostatic Testing of Mains No specific procedure is mentioned for disinfection of mains, only that it be completed prior to testing. The specs do call for "liquid chlorine" use; the Water Division furnishes all materials and labor except tbe contractor taps the mains. However, if more than one sterilization is needed, the City assesses the contractor a charge of 1.5 to 12 cents per foot depending on the size of the main. General regulations for cast iron, ductile iron, or A/C pipe are as follows: pipelines, when tested at a pressure of 125 psi for at least 8 hours, cannot show leakage in excess of the amounts shown in the table. Maximum Allowable Leakage (Gallons Per Hour Per 1000 Ft. of Main) Pipe Size Type of Pipe and Joint (inches) C.I. Lead Jt. C.I. or D.I. Push-on A/C Collars 2 1.58 4 3.16 6 4.74 8 6.31 12 9.47 16 12.63 20 15.78 24 18.94 30 23.67 0.34 0.68 1.01 1.35 2.02 2.69 3.36 4.03 5.04 1.29 1.72 2.58 3.44 - - - Tapping Methods Contractors also handle most of the tapping. This occurred two years ago because the maintenance department was "too far behind." Now the contractors make taps and the maintenance section inspects the work. For tapping A/C, double strap epoxy coated saddles are used. Some organizations choose to use Hays seals (El Paso is an example)and these are fine if installed correctly. In tapping cast iron, the City uses Mueller 15000's or Hays seals. CAPCO JEN 0023479 -12- Reconunended Work Practices The Maintenance Section Manager is "slightly familiar" with Recommended Work Practices for A/C. The Addendum to the installation specifications instructs contractors to be familiar with the provision of the "Contract Work Hours and Safety Standards Act" and the "Williams-Steiger Occupational Safety and Health Act of 1970." Operation and Maintenance The Maintenance Section of the Water Division commands most of the attention in the Department. The reasons are obvious: they have 4517 miles of mains to maintain and, given the soil conditions, the wet-dry cycles, and the preponderance of cast iron pipe, it is a difficult job. In 1981, the Maintenance Section had 23,684 reported leaks or breaks. This number is highly questionable since the number of repairs on A/C, cast iron, and galvanized amount to about 8000. The charts on the following pages show main breaks repaired in 1981. The number of cast iron breaks is 5251; galvanized breaks total 2433 while total A/C breaks is 293. Thus, cast iron breaks amounted to 18 times the number of A/C breaks. Two-inch cast iron and galvanized present the greatest problem as can be seen from the statistics; breaks in this size account for 61.5% of the total for these two materials. Emerick Jacobs, Maintenance Section Manager, notes that the City get all types of breaks in A/C--flex, circle, and hair line cracks. Circle breaks are the most prevalent. He believes most main breaks can be attributed to 1) ground shifts and 2) electrolytic actions although 3) subsidence and 4) excessive water pressure in the system also are factors. Excessive water pressure is a factor cited by the Director as well. In the summer time when demand is at its peak, he orders pressure reduced by 5 psi to take the strain off the system. Normal service pressure is 45-65 psi with a lot of low pressure areas. The repair policy is to replace A/C with A/C pipe exclu sively. For repairs to cast iron, the Department favors C-900 PVC. One of the reasons is that no transition coupling is needed. This is a comment heard often during the site visits. Jacobs prefers A/C to PVC overall, however. He has con fidence in A/C, but not in PVC. Although the engineering section is convinced that PVC is "the pipe of the future," Jacobs is not. He believes a complete section should be in the ground for 8-10 years before PVC can be judged objectively. PVC must prove better than A/C and, according to Jacobs, that is going to be hard to do. CAPCO JEN 00234-80 I Emerick Jacobs Jr. -13- CITY OF HOUSTON INTER OFFICE CORRESPONDENCE From Ms Doris James Date Subject March 10, 1982 Cast Iron and Galvanize Water Mains repaired during 1981 Dear Sir: Below a chart listing all Cast Iron and Galvanize Water Mains repaired by Water Maintenance during the year 1981. DIST.#1 DloT.i?2 DlnT.#3 D1jT.#4 D'. :T.#9 2" 3" C.I. 316 0 GALV. 872 0 C.I. 713 GALV. 696 0 0 C.I. 761 GALV. 296 1 0 c.i! GALV. C.I. GALV. 409 23 116 524 0 0 0 0 4" 56 3 30 0 54 0 40 1 17 10 6" 281 1 131 .0 ISO 0 345 2 124 0 8" 156 1 179 4 398 n 253 0 126 0 12" 23 0 73 o 173 n 44 0 48 0 16" & LARGER TOTALS 7 839__________ 0 877 37 1163__________ 0 700 17 1708 .. n 296 0 1091 0 26 19 450 ___ Q_____________ ......... 534___________ TOTALS 7,684 The grand total of all five District is 5,251 cast iron and 2,433 galvanize Water Mains repaired by Maintenance in 1981'.' ' DJ:anh Doris Jgpjes Administrative Assistant Northwest Water Service Center i CAPCO JEN 0023481 To : Emerick Jacobs Jr -14- CITY OF HOUSTON INTER OFFICE CORRESPONDENCE From: ms Doris James Date: March 9, 1982 Subject . &C Mains repaired during 1981 Dear Sir: Below- please find a chart listing all AC Mains repaired by Water Maintenance during the year 1981. DIST., 1 --2" 0 DIST. 2 0 DIST. 3 0 DIST. 4 23 DIST. 9 0 3" ' `3 0 .0 0 0 4" .0 :o '0 .i .0 6" 42 ,7 ; 30 32 4 , 8" . 48. 7 30 . 42 ;6 , 12" 6 0 0 9 .0 ,16" ;3 , = 102 '6 = 14 . 0 = 60 o' = 107 6 % 10 total 293 The grand total of all five Districts is 293 AC Mains Repaired in 1981. DJ:dah Ms Dori Administrative Assistant Northwest Water Service Cntr. i CAPCO JEN 0023482 -15- Repairs are made by applying a leak clamp or sleeve in about 65% of cases. In about 35% of cases, a short section or full section is installed. With regard to costs, Jacobs estimates that it costs the City $1000 per hour to have a repair crew on duty. Each crew averages 3-4 repairs in an 8-hour shift. Thus, total repair costs (including paving) can be estimated roughly at $2000-2500 per break. When asked which material costs more to repair, Jacobs speculated that cast iron costs more than A/C because of having to use a mechanical joint sleeve. The total repair budget for mains and hydrants in 1982-83 is $1.2 million, down from $1.96 million in 1981. The total budget of the maintenance department is in excess of $40 million. The Aggressive Index of the surface water from Lake Houston is about 11.93. The pH is boosted with sodium hydroxide or lime to elevate it to the 8-9 range. Hardness and alkalinity are low, averaging 40 and 69 mg/1 respectively. The Aggressive Index of a typical well water in the area is 11.81. Hardness and alkalinity are much higher in groundwater than surface water, averaging 115 and 250, respectively. Houston does have a main flushing program. It is operated by the Quality Control Section. Dead ends are not eliminated; they are handled through blowoffs periodically at the end of the line. Detection and Prevention Unaccounted for water in Houston is 18%. Until an aggressive leak detection program was initiated, the total was 22%. The valve maintenance crew, headed by a former Pitometer Associates employee, is in charge of the leak detection program. They have two persons searching for leaks on a contin uous basis. Equipment used includes aquaphones, geophones, and a new "electronic leak detector." The Maintenance Manager could furnish no details on this latter piece of equipment. However, it is thought to be the system marketed by Fluid Conservation Services of Austin, Texas. FINANCIAL The financial information made available was sparse indeed. An audited financial report is in preparation, but will not be available until May 1. CAPCO JEN 00234-33 16- The budget of the Water Division in 1982-1983 totals $125,699,195. According to the Director, they break even or show a small surplus each year. The City takes approximately 5% of the funds; there was no rationale provided as to why this happens. Houston's Water Division has a huge capital replacement program funded primarily (72%) through water revenue bonds. A total proposed expenditure of $982,521,000 is planned through the year 1992. Of this total $276,706,000, or about $25 million per year, will be spent on the distribution system. Pipe depreciation schedules were obtained. A/C pipe is depreciated over a 26-year period; cast iron is depreciated over a 40-year period; and PVC is depreciated over a 50-year period. Comparative bid data also were obtained. The following chart shows August, 1981 bid prices for A/C and PVC pipe. Size/Material Quantity Bid (feet) Winning 4 inch A/C 6 inch A/C 8 inch A/C 12 inch A/C 16 inch A/C 10,000 60,000 65,000 15,000 10,000 2.32 3.17 4.39 8.54 13.66 2 inch PVC 4 inch PVC 6 inch PVC 8 inch PVC 12 inch PVC 40,000 5,000 5,000 1,000 1,000 0.37 2.56 3.66 6.10 11.59 These comparative prices are similar to those in other systems visited. A/C is only marginally cheaper in smaller sizes, but it still enjoys a significant price advantage in 8- and 12-inch sizes. Technical Information Needs When asked what the Association could do for Houston, the following suggestions were received: o Need readily available information on health issues that is published by a reliable source other than the manufacturers of A/C pipe. Would like to have a slide show explaining, dispelling health concerns. Water Division officials often get requests from community groups to make presentation on safety of A/C. CAPCO JEN 0023484 -17- o Would like to see research conducted on 1) ways of making A/C stronger, 2) effects of bedding, and 3) continued research on health related issues. Summary and Conclusions Houston is probably the largest single customer of A/C pipe in terms of actual miles installed annually. In the past two years, Houston has averaged almost 100 miles in instal lations. With a $276 million main replacement program in place and given their policy of making almost all main replacements with A/C, Houston represents a large chunk of business over the next 10 years. Houston's Water Division personnel are split on opinions regarding the type of pipe to buy in the future. Of the three votes that count, two (the Director included) favor A/C. Every effort should be made to ensure Houston remains a good customer. As noted earlier, not much is required since they are generally staunch believers in A/C. However, the technical assistance requests should be addressed and a bit of PR in the form of periodic courtesy calls on the system director are needed. i CAPCO JEN 0023485