Document Rp8oJrzVzpKELdYvY1ygmN4dV

OCORViOeCCMFt.MMtHATSMOON. JR. ^ocuTt unMk eewMsn. W. R. Grace & Co. HANOVCK MUAftC. NCW VOMM.N.T. IOOOS January Federal Trade Commission Washington, D.C. 20530 Attention: William A. Arbitman, Esq. Re: File No. 671 0622 Gentlemen: This is In reply to the letter of November 10, 1966 addressed by Mr. William J. Boyd, Chief, Division of Mergers of the Federal Trade Commission to Mr. J. Peter Grace, President, W. R. Grace & Co. The following responses are numbered to corre spond with the item numbers in the letter of November 10, 1966 and the names "W. R. Grace & Co." and "Grace" are used herein in the manner Indicated in the third paragraph pf that letter. Item 1. The following is a list by their Seven Digit Census Product Codes of vermiculite and perlite products produced by Grace. Seven Digit Code Product 1^993 05 32950 11 Vermiculite Ore Expanded Perlite 32950 13 Exfoliated Vermiculite - Light Weight Aggregate 32950 15 Exfoliated Vermiculite - Other (such as loose fill insulation acoustical, etc.) 10027131 2 Grace does not produce any products which are substantially similar to vermiculite or perlite and/or competitive with them. The following is a description of each of the aforesaid vermiculite and perlite products: 1^993 05 - Vermiculite Ore WL Vermiculite is a micaceous mineral that ^defoliates or expands when heated. It is a hydrated magnesiunValuminum- iron silicate. W. R. Grace & Co. through its Zonolite division mines vermiculite ore concentrate at Libby, Montana and Enoree, South Carolina. The ore is washed, sized and shipped to expanding plants, dealers, distributors and customers for exfoliation. There is some ore used in the unexfoliated state but the greatest use is for exfoliated products. 32950 11 - Expanded Perlite Perlite is a volcanic porous rock which, when sub jected to high temperatures expands to several times its original size. Expanded perlite is .a light-weight, snowwhite, bead-size material. Expanded perlite is used as a light-weight additive for building plaster and as an aggregate for roof deck concrete. It is also used as a granular Insulating material for low temperature storage, in cryogenic insula tion, and hortlculturally for seed bed material. 32950 13 - Exfoliated Vermiculite - Light-Weight Aggregate Exfoliated vermiculite is used as an aggregate with gypsum in light-weight, fireproofing plaster and with Portland cement in light-weight, fireproof concrete for floor, roof and roof deck insulation. 32950 15 - Exfoliated Vermiculite - Other Exfoliated vermiculite for uses other than as a light-weight aggregate Include: (a) Attic Insulation and Insulating Fill - Loose fill products used principally for insulating ceilings and sometimes walls in new and existing buildings. 10027132 -3- (b) Masonry Fill - Fireproof, rodent-proof, loose-fill insulatiflfel designed for filling the cores of concrete blocks and the cavity of hollow masonry walls. (c) Acoustical and Fireproofing Products Consist of a line of pre-mixed materials, which are mixed with water at the Job site for spraying on steel and concrete surfaces to provide inaulatifi#, sound conditioning, fireproofing and an attractive finish. The products are composed of vermiculite, combined with swelling type clays or gypsum binders, asbestos fibers and other additives for specific j features, such as workability, color, etc. (d) Agriculture, Home Gardening and Outdoor^--- Living Uses - Include an anti-caking agent fj*-ttlgh analysis farm fertilizers; chemical cwsierfor pesticides, herbicides and plaatnutflents; firebase for charcoal in outdoor grillsJjsoil conditioner; mulch; seed starter; plant propagator. f (e) Industrial Uses - Include insulating of coke ovens, slow cooling of forgings, grease absorbent ingredient, packaging and shipping. Vermiculite and perlite compete in their different end-uses in varying degrees. Generally, the physical characteristics determine which has the greater acceptance for a given application and in most cases price is not an important factor. However, in all cases both perlite and vermiculite compete with a wide variety of other materials. Discussions of vermiculite versus perlite and their major end-uses follow: Plaster Aggregate Perlite finds its greatest use as a light-weight aggregate for plaster where vermiculite finds very~limited use. Most plasterers prefer perlite plaster mixes over vermiculite because perlite has the abrasive characteristics of sand (sand is widely used in plaster) and because of its white color. Vermiculite does find some use as a plaster aggregate primarily -where greater acoustical properties and/ or an improved textured finish is desired. 1002?13a m. I Mineral Type Insulating Board a \2 S/,,' The second largest use for perlite is/in mineral type insulating board such as Johns-Manville "Proaoft" Board. Vermiculite finds little or no use in this application. Perlite is much cheaper than vermiculite in this application. Perlite also provides a higher insulating value and drains and dries easier in the production of the board. Filter Aid Perlite finds wide usage as a filter aid in filtration of water and various chemicals. Vermiculite, because of its moisture absorbing characteristics, is unsuitable for this usage. /Cryogenic Insulation Perlite also finds wide usage in cryogenic insulation where it provides a higher insulating value than vermiculite and at a lower cost. Concrete Aggregate The major area of competition between vermiculite and perlite is as a light-weight aggregate in concrete mixes. Here vermiculite and perlite compete with a number of other aggregates including expanded shale and cellular or foamed concrete. Vermiculite and perlite have quite different features as a concrete aggregate. Perlite concrete has a higher insulating value than vermiculite concrete, it is stronger, uses less water in the mix and dries faster, and has a somewhat lower cost. Vermiculite concrete is much easier to pump than perlite concrete which, because it is very abrasive, does not lend itself to pumping well and vermiculite concrete is more stable than perlite concrete which has unpredictable growth characteristics. Agricultural/Horticultural In the agricultural/horticultural field, the physical characteristics again play the leading role in determining preference between vermiculite and perlite. 10027134 -5- Perlite sheds water and accordingly is widely used where good drainage is desired. In addition, it can be washed, sterilized and reused while vermiculite cannot. Its pure white color is also an important factor in some applications. Vermiculite, on the other hand, retains moisture which gives It an advantage where water retention is desired. As a chemical carrier, vermiculite is much pre ferred over perlite because it can absorb large quantities of liquids and remain free flowing, and because it is nonabrasive. Perlite finds little use as a carrier because of its low moisture retention and its abrasiveness damages some spreaders. In certain areas, perlite can offer a price advantage depending on proximity to mining and expanding facilities. Home Insulation Vermiculite and perlite compete with a great many products in the insulation field. As to vermiculite versus perlite, vermiculite has certain characteristics that make it preferable over perlite in the "loose fill" type of insulation. First It is relatively dust-proof as compared to perlite which is quite dusty. Secondly, it flows better than perlite. These factors are major plusses for the home Insulation market which is predominately "do it yourself". Perlite, on the other hand, has a higher insulation value, a somewhat lower cost and is universally available. The latter advantage is partially offset by a lack of uniformity in the product. Copies of the following brochures, specification sheets, catalogues and other similar materials which describe vermiculite and perlite products are enclosed herewith in the folder marked "Exhibit 1-1". Vermiculite-General G-231 Properties and Uses (of Vermiculite) 10027133 / 6- - Perlite PA-95 Tile-Ag Perlite Tile Aggregate PA-9o Perl-Ag Perlite Plaster Aggregate TL-105 Perl-Lite Horticultural Perlite Perlite Institute Perlite Loose Fill Insulation Perlite Institute Perlite Plaster Aggregate Exfoliated Vemlcullte-Aggregate CA-100 Series-Zonolite Insulating Concrete CA-140 Vermiculite. Concrete Hoof Deck Systems PA-54 Zono-Coustic Acoustical Plaster PA-99 Plaster Aggregate and Spray.-On Fire^potffing t Exfoliated Vermiculite - Other HI-108 Zonolite Insulatio^V^ HI-119 Zonolite Insulating Fill MF-33 Masonry Fill Insulation MF-125 Guide Specifications for Masonry Fill PA-87 Fire Protection and Sound Absorption G-272 Verxite Granules TL-I38A Terra-Lite G-I87 Bar-B-Sorb Additional literature of this type was submitted as Exhibit 6 to Grace's letter of April 1, 1963 in response to the Commission's inquiry of March 18, 1963 relating to the acquisition by Grace of The Zonolite Company. Item 2(a). The products listed in response to Item 1 are mined, manufactured, processed and/or sold by the Zonolite division, Texas Vermiculite Company, a 76#- owned subsidiary, California Zonolite Company, a 100#- owned subsidiary aasd-ArirZonolite Oompany, a o7/S-ovmed subsidiary* l 3?t Jt ^ a /.,, / *+!- -X Item 2(b). Exhibit 2(b)-1 submitted herewith shows the location of all mining, manufacturing, processing and principal distribution facilities for those products listed in Item 1 that were owned and/or operated by Grace during 1963, 1984 and 1965 and the principal product or products mined or manufactured therein. The normal selling areas for each facility, except the mines, is a radius of 150 miles from the plant. The Enoree, South Carolina mine serves the Eastern section of the Unitsd States end the Libby, Montana mine serves the Central and Western sections of the United States. 10027134 Item^ 2(c), (e) and (f). Records are maintained < . by Zonolitev^^Jifche quantity and dollar value of sales of/ r each selling district rather than of the quantity and dollar value of sales, and shipments (including interplant transfer/ made from each facility listed in Exhibit 2(b)-l. Exhibit 2(c)-1 submitted herewith shows sales by seven digit product codes for each selling district. It is believed that the shipments would have been made, for the most part, from the facility listed in Exhibit 2(c)-1. However, the sales will also Include some shipments made into the district from one or more of the listed facilities. Item 2(d). The following describes the competition and market shares for each product listed in Item 1# thg-WrtCTT L iu lmetia by Qraj.a Grace has no mean ingful information by individual selling areas. 14993 05 - Vermicullte Ore Vermiculite ore production in the United States in 1964 according to the "Bureau of Mines Mineral Yearbook - 1964" was 226,300 tons. In addition, l8,400 tons were imported from South Africa. Grace's production of vermiculite ore in 1964 was 221,000 tons (approximately 90# of the total U. S. production and imports for the year). Other U. S. producers of vermiculite according to the Minerals Yearbook are: Patterson Vermiculite Co., South Carolina American Vermiculite Co., South Carolina Rlmledge Uranium and Mining, Colorado There is a great deal of vermiculite ore located all over North America. However, the only known large deposits with high concentration are owned by Grace and the companies referred to above. Grace's large share of the U. S. vermiculite production arises out of the natural phenomenon that the largest known vermiculite deposit in the Western Hemisphere is in a knoll in northwestern Montana that Is owned by Grace. It is estimated that this single deposit, which is located on one knoll in Montana, represents*more than 90# of the total developed vermiculite reserves in the United States. 10027137 Venniculite finds fierce competition in every market from many of the nation's largest suppliers of construction materials and from such materials as perlite, glass fiber, foam plastics, peat moss, blast furnace slag, gypsum, rock wool, polystyrene foam, asbestos, sand and many others. 32950 11 - Perlite The Bureau of Mines Mineral Yearbook - 1965 "Preprint on Perlite" shows that 3*14,000 tons of expanded perlite were sold by U. S`. producers in 1965 and that perlite was expanded by 63 companies at 97 plants. Grace sold 7,900 tons of expanded perlite in 1965 or 2# of total U. S. sales. Names and addresses of perlite expanders are given in the Pit and Quarry Map furnished as Exhibit 2(d)-1. 32950 13 - Exfoliated Vermiculite Aggregate The Department of Commerce Census of Manufacturers provides "7 digit" product information every five years. The most recent "7 digit" information is for the calendar year 1963. The 1963 Census provided two classifications for light-weight aggregate as follows:1 2 1) 32950 11 - Light-Weight Aggregate (such as dlatomaceous earth, expanded clay, expanded slag, perlite, cinders, haydite, pumice,but excluding vermiculite) and 2) 32950 13 - Exfoliated Vermiculite - Aggregate The reportable quantities published by the Depart ment of Commerce for these classifications and Grace's sales of each are as follows: Light-Weight Aggregate 10027130 1963 Census 32950 11 Light-weight aggregate, ex vermiculite 32950 13 Light-weight aggregate, vermiculite Total U.S. Production (tons) 5,75^,913 72,469 ___ 5.b31.302 Sold by % of Grace Total (tons) 4,430 0.155 32,640 45. o 0.6% -9 - Grace's sales In the 32950 11 classification were of expanded perlite. There is intense competition in these markets from other materials. As shown above, Grace's share of the light-weight aggregate market, as determined by the 1963 Census of Manufacturers, was less than 1%. Grace's share of vermlcullte aggregate sales is due to the natural phenomenon of the vermlcullte concentration in the one knoll in Libby, Montana as discussed above. There are a great many producers of light-weight aggregate in the United States. Pit and Quarry Publications, 431 S. Dearborn Street. Chicago, Illinois publishes a map each year showing the "Light-weight Aggregate Producing Plants in the United States and Canada." A copy of the 1965 edition of this map is submitted herewith as Exhibit 2(d)-l. This map gives the names and addresses of most of the U. S. producers of the following light-weight aggregates: Cinders, Diatomite, Expanded Clay, Expanded Perlite, Expanded Shale, Expanded Slag, Expanded Slate, Expanded Vermlcullte, Ply Ash, Pumice, Tuff, Volcanic Ash, Volcanic Cinders, Volcanic Scoria. It is believed that this map, although not all inclusive, lists the majority of the light-weight aggregate producers. However, as noted on the map, "Plants manufacturing light-weight aggregate solely for their own use are not listed on the map. Also omitted from this map are plants that failed to provide information regarding their product, location and brand name." ie sales of light-weight aggregate of these producers (excluding Grace and its distributors) is not known to Grace. 32950 15 - Exfoliated Vermlcullte - Other Grace sold 51,345 tons (52$S) of the total tonnage (98,951 tons) of Exfoliated Vermlcullte - Other (Code 32950 15) reported in the 1963 Census of Manufacturers (the most recent 7 digit census). t Grace sales reported under Exfoliated Vermlcullte Other (Code 32950 15) in the 1963 Census of Manufacturers had end-uses as follows: 10027*3* I -10- Expanded Vermlcullte - Other Estimated Sales by End-Use Building Insulation Carrier for Non-Farm Agricultural Chemicals Mixed Products - Fireproofing and Acoustical Soil Conditioner (Terralite) Miscellaneous (Firebase, etc.) $ 2,000,000 800,000 600,000 300,000 200.000 $ 3,900,000 Building Insulation Grace sells expanded vermlcullte as loose-fill insulation for new and existing buildings. This is known as home insulation where it is used principally to insulate .attics and as masonry fill insulation in concrete block and cavity wall construction where it is poured in the core of the block or in the void between two masonry surfaces. /J The total building insulation market was eatfafl^ted V by Grace management to have been well in excess of^$l50,000,000 in 1963 with Grace's estimated vermlcullte sjiersto the market of $2,000,000 representing 1.3# o^tfie total. Mineral wool insulation is the biggest factor^n this market as indicated by the 1963 Census of Mamrfacturers which reported under Code 32961 - "Mineral Wool Structural Insulation" 'total shipments of $107,678,000*ofnthtah $19,06l|000 was^ffT "tseeo Wasl and-Ommlaled WP3111 aud $0^333,OOO"ln "Builds Zonolite's prinicpal competition in the building insulation market are: Armstrong Cork Co. Allied Chemical Baldwin-Ehret-Hill, Inc. Celotex Corp. Dow Chemical Co. Eagle Picher Co. Gustin-3aeon Mfg. Co. Johns-Manville Llbby-Owens-Ford Glass Co. National Gypsum Co. Owens-Corning Fiberglas Corp. Pittsburg Plate Glass Co. Reynolds Metals Co. U. S. Gypsum 10027140 - 11 - Carrier for Non-Farm Agricultural Chemicals There is no published information on this market. Grace's estimate of the Zonolite Company's position in this market was described in Grace's letter of April 1, 1963 replying to the March 18, 1963 inquiry of the Federal Trade Commission as follows: "Zonolite1s vermiculite competes with the following products as a carrier for non-farm agricultural chemicals: perlite, ground corn cobs, cocoa shells, pecan shells, calcined clay, sand, limestone, rice hulls and straw.'' Zonolite's principal competitors in this market are: Great Lakes Carbon -- Johns-Manvilie United Perlite Corp. Oneida Perlite Corp. Minerals & Chemicals Georgia KayIon Co. International Minerals In addition to the above, materials used as carriers for agricultural chemicals are readily available throughout the country from many local suppliers. The size of the market for carriers of non-farm agricultural chemicals is not available. Accordingly, Grace's percentage of this total market is not known. The total market for non-farm agricultural chemicals was estimated to be $250,000,000 annually in an article in "Chemical Week" magazine (February 23, 1963, page 121). It is therefore a reasonable inference that the percentage of the total market in carriers for non-farm agricultural chemicals represented by Grace's sales in this market is very small. Mixed Products - Fireproofing and Acoustical Grace's mill mixed plasters for fireproofing and acoustical insulation compete with perlite plasters, acoustical tile, cement encasement, lath and plaster, and sprayed-on asbestos sold by the following companies which are Grace's major competitors in this field: 10027141 Armstrong Cork Co. Asbestos Spray Corporation Celotex Corporation Columbia Acoustics & Fireproofing Co. Great Lakes Carbon Co. Johns-Manville Keasbey and Mattlson Co. National Gypsum Co. Smith and Kanzler Corporation U. S. Gypsum Data is not available for the total annual sales of building fireproofing materials. The aruiual sales of acoustical tile as estimated in "Sound Ideas" (Summer 1962 Edition, published by the National Acoustical Contractors Association) are $120,000,000. It is further estimated by this publication that acoustical tile sales account for 98# of the annual U. S. acoustical insulation market. Based on these figures, Grace's sales in the building, fireproofing and acoustical insulation market represent less than 1# of the market. Soil Conditioner (Terrallte) Grace's Terrallte competes with peat moss in the market for soil conditioners. Grace does not know of any single large producer of peat moss. The "Minerals Yearbook, 1961" (Volume II) states that they surveyed 123 producers in 22 states to obtain production statistics. This publication shows that the total peat moss consumed in the U. S. in 1961 amounted to $18,200,000 . 94# of the peat moss consumed in the U. S. in 1961 was used for soil conditioning. Grace's estimated sales of Terrallte for the fiscal year ending March 31> 1962 amounted to $320,000 or approximately 1.8# of the total soil conditioner market. Item 3. The corporations engaged in the manufacture, processing and/or sale of any of the products listed in response to Item 1 which were acquired by Grace since January 1, 1951 are the Zonolite Company and Perlite, Inc. In addition, upon the acquisition of the Zonolite Company Grace acquired among other assets of'Zonolite approximately 27.5#> 46.8#, 33*3# and 32.9# of the capital stock of Vermiculite Northwest, Inc., California Zonolite Company, Ari-Zonolite Company and Western Mineral Products Compeny, respectively. ftie Zonolite Company participated 10027142 - 13 - In the formation of these companies furnishing financial assistance, people, know-how, formulas, product literature advertising, etc. The Zonolite chief executive was a member of the Board of Directors of each company and actively participated in the management of the companies. In addition, Zonolite specialists, including financial, tech nical and marketing personnel, assisted them is their operations. Grace acquired during 1966 all of the outstanding stock of Vermiculite Northwest and California Zonolite not already owned by Grace and also acquired an additional 33 1/3# of the stock of Ari-Zonolite. In 1966, Western Mineral Products was merged into Grace. These transactions were effected in each case in order to permit the stockholders of these companies to obtain a readily marketable security to represent their investment and to afford to them a participation in Grace's other activities. Detailed information regarding The Zonolite Company was furnished to the Federal Trade Commission by Grace in response to the Commission's inquiries of March 18 and June 2k, 1963. The information so furnished is incor porated herein by reference. The following information is submitted in respect of Perlite, Incorporated, Vermiculite Northwest, California Zonolite, Arl-Zonolite and Western Mineral Products. ^leidiuiLU j i Perlite, Incorporated Perlite, Incorporated, 1050 S. E. 5th Street, Hialeah, Florida, was acquired by Grace on October 18, 1965. Grace purchased for $175*000 cash the land, building, pro duction equipment and the trade name "Florallte". In addition, the inventory on hand on October 18, 1965 was purchased for $19*818. ~ Perlite, Incorporated served the Southern Florida market with a line of construction and horticultural products. Its only manufacturing operation was the expansion of perlite ore and packaging of the expanded product. Its products fall into two seven digit census product codes as follows: 32950 11 - Expanded Perlite 99989 00 - Resale Items 10027143 . - 14 - Perlite, Incorporated's sales of expanded perlite products, in the estimated order of importance are: plaster aggregate, concrete aggregate, ceramic tile mortar aggregate and as a light-weight soil mix for horticultural use. In addition to the expanded perlite line, Perlite, Incorporated handled on a jobber basis a line of construction items principally lime products, roof metal products and cement. Since these items were not manufactured by Perlite, Incorporated, they all fall into the Census Product Code for resale items (99989 00). Perlite, Incorporated operations were all conducted from its one plant in Hialeah, Florida located at 1050 S. E. 5th Street and its normal selling area is in a 275 mile radius of Hialeah, Florida. ' Perlite, Incorporated had gross sales for the fiscal year ended October 31* 1964 of $276,700, of which $152,700 was in perlite products and $124,000 in resale items. Its total assets on October 31* 1964 were $147,182. This was from the most recent balance sheet submitted to Grace by Perlite, Incorporated. The following is a list of the names and addresses of the Perlite, Incorporated executive personnel at time of acquisition by Grace: Name Position Home Address LaVerne Christopher Allen Mabel V. Grimes Bruce Noland Robert W. Allen President & Treasurer Vice President General Manager Secretary Morgantown, West Virginia Morgantown, West Virginia Miami, Florida Morgantown, West Virginia flefarenet 3"? Vermlcullte-Northwest, Inc. On September 15* 1966, Grace acquired 5*235 shares representing 72.5JS of the outstanding shares of common stock of Vermiculite-Northwest, Inc., 2020 Airport Way. South, Seattle, Washington, in exchange for 1,8S6 shares of Grace common stock. The purchase price was based on the December 31, 1965 book value of the 5*285 shares purchased which was $103*590. The Grace shares were calculated at the average market value for the month of December 1965 which was $54.93* The purchase of the additional 5,285 shares gave Grace full ownership of the 10027144 - 15 - company as The Zonolite Company -.iwned 2,000 shares at the time of acquisition by Grate. Vermiculite-Northwest purchased vermiculite ore from Grace which it exfoliated and sold under "Zonolite" brand names. The company also sold under Zonolite brand names glass fiber insulation manufactured by Johns-Manvi1le. Vermiculite-Northwest's product line was the same as the Zonolite product line described in response to Item 1. Approximately 60# of the sales of Vermiculite-North west was of exfoliated vermiculite products and approximately was glass fiber Insulation. Vermiculite-Northwest operated an expanding plant in a leased facility at North 131j Maple Street, Spokane, Washington, and an expanding plant in leased facilities at 2303 N. Harding Street, Portlend, Oregon. In addition, it leased a warehouse/office building located at 2020 Airport Way South, Seattle, Washington. Its selling area covers the States of Washington, Oregon and Northern Idaho and its sales in 1965 were $673,000. It had total assets on September 30* 1966 of $193,317. The following is a List of the names and addresses of Vermiculite-Northwest's executive personnel at time of acquisition: Name Position Home Address W. V. Culver A. C. Tressl M. McDaniel President Vice President, Treasurer and Sales Manager Prociuctior liana ;er 11012 S.E. 31st S-Greet Bellevue, Washington East 14219 Valley Way Spokane, Washington West 734 Knox Spokane, Washington California Zonolite Company On September 14, 3966, -race purchased 13,917 shares (53.256) of the 35,58^ outs anding shares of the capital stock of California Zcr.ol te Company, 758 Colorado Boulevard, Los Angeles, Califcrr.i for 23,727 shares of 10027149 Grace stock which, valued at tin September 14, 1966 closing price on the New York Stock Exchange of $38,125, had e value of $904,592. As The Zeno ite Company owned 16,f.6f shares of the California Zonoli e stock at the time Grace acquired Zonolite, this purchas gave Grace full ownership of the company. California Zonolite pi rchased vermicuiite ore from Grace which it exfoliated -nd sold under Zonolite brand names. The company also .old under Zonolite brand names glass fiber insulation manufactured by Johns-Manvilie. This company's princijal products are the exfoliated vermicuiite products described n response to Item 1. It also sold, on a resale basis, gl- ss fiber insulation and polystyrene molded board. California Zonolite oierates vermicuiite expand ing plants located at 6851 Smith Avenue, Newark, California and at 5440 San Fernando Road Wcot, Los Angeles, California. In addition, they maintained the headquarters in a leased facility at 758 Colorado Boulevard, Los Angeles, Cali.'ornia. Its normal selling area covers the state of California and western portions of Nevada and its net sales in 1965 were $1,887,000. Its total assets on September 30, 1906 were $999,803. The following is a list of tf3 names and addresses of California Zonolite's executive personnel at time of acquisition: Name Position Home Address C. H. Wendel President 432 Georgian Road Pasadena, Calif. J.A. Kelley Treasurer 2072 Orrington Avenue Evanston, Illinois A. W. Dambros T. H. Pickthall Vice President, Sales Manager, So. California Vice President, Sales Manager, No. California 15214 Tuba Street Mission Hills, Calif. 42253 Camino Santa Barbara, Mission Hignlanc East, Freemont, Calif. D. F. Gillin Assistant to President 5534 Gross Canyon La Crescenta, California J. H. Huxley Production Manager 915 University Avenue Burbank, California 10027144 -17 - ftiT'tfiiLe 3-5 Ari-Zonollte Company On September 14, 1966, Grace purchased 2,000 shares (1/3 of the 6,000 outstam ing) of the capital stock of Ari-Zonolite, 5201 Glendale Avenue, Glendale, .Arizona, for $62,100 in cash plus an additional $5,220 In.sash for the change in its. bool; value between December 31* 1965 and September 14, 1966. As The Zonolite Company owned 2,000 shares of Ari-Zonolite stock at the time Grace acquired Zonolite, this purchase gave Grace two-thirds ownership of the company. Ari-Zonolite purchased vermicuiite ore from Grace which it exfoliated and sold under Zonolite brand names. The company also sold under Zonolite brand names glass fiber insulation manufactured by Johns-Manvilie. Ari-Zonolite's principal products are the exfoliated vermicuiite products described ir. response to Item 1. It also sold^on a resale basis, glass fiber insulation and polystyrene molded board. Ari-Zonolite operates o it of one plant located at 5201 Glendale Avenue, Glendale, Arizona. Its sales territory covers the state of Arizona and a small portion of southern Nevada. Its net sale; for the year ended December 31, 1965 were $333,9^0 aid its total assets on September 30, 1966 were $260,628. The following is r. list of the names and addresses of Ari-Zonolite's executive porso .nei at time of acquisition: Name Position Home Address C. H. Wendel President 432 Georgian Ron.<j, r-ioaucna. Cal. J. A. Kelley Treasurer 2672 Orrington Avenue, Zvanston, Illinois D. Gilchrist General Manager 3338 North 6lst Place, Scottsdale, Arizona R. Mariano Plant Manager 2335 Nest Campus Drive Phoenix, Arizona 10027147 Item 4, Following is i list of the documents being furnished as requested in item 4. The supporting documents are enclosed in'separate folders for each acquisition marked as follows: Perlite, Inc. Vermiculite-Northwest, Inc. California Zonolite Company Ari-Zonolite/ Company >-- //-. Grace Numb --*=I 4-2 4-3 4-4 7 Exhibit 4-1 Grace's Acquisition of : it a) Agreements relating to the purchase of Perlite, Inc. assets. b) Cash transaction - no documents filed with Securities and Exchange Commission or stock exchange. c) Copy of the following: Request for Capita Appropriation submitted to Grace Board of directors. Analyses, profitability studies, etc. made on this acquisition are contained in this document. d) There were no pres: releases or written announcements to ci stomers, suppliers, or employees prepared by Grace on the purchase of Perlite, Inc. a: sets and, to the best of our knowledge, the. * were no such releases or announcements pr epared by Perlite, Inc- Exhibit 4-2 Grace's Acquisition of Vermiculite- Northwest. Inc. - a) Agreement and Plan bf Reorganization among W. R. Grace Ss Co., Vurmiculite-Nortnwest, Inc. and Selling S'ockholders dated August 5, 1966. b) Listing Aunlicatioi to the New York Stock Exchange (Thi? app: ication also covered the listing of ths stock issued in the California- Zonolite acquisition). 10027148 - 19 - c) Copy of the following: Request for.Capital Appropriations submitted to Grace Board of Directors. Analyses, profitability studies, etc. that were made on this acquisition are contained in this document. d)\ There were no press releases or Mitten announcements to customers, supprters, or employees prepared by Grace on the purchase of Vermiculite-Northwest's assets and, to the best of our knowledge, there were no such releases or announcements prepared by Vermiculite-Northwest. Exhibit 4-3 Grace's Acquisition of California Zonollte Company a) Agreement and Plan of Reorganization among California Zonollte Company, its stockholders and W. R. Grace & Co. dated August 17, 1966. b) The Listing Application filed with the Nevf^^ York Stock Exchange: on this acquisitiorv^Ta being submitted under Exhibit 4-3(&-) Covering Vermiculite-Northwest, Inc. (The application covered both acquisitions.) c) Copy o:` the follow ng: Request for Capita. Appropriation submitted to Grace Board of I'irectors. Analyses, profitability studies, etc. that were made on this acquisition a: e contained in this document. d) There were no press releases or written announcements to evstomers, suppliers, or employees prepared by Grace on the purchase of California Zonollte Company assets and, to the best of our knowledge, there were no such releases or announcements prepared by California Zonolite Company. 2. 10027147 - 20 Exhibit 4-4 Grace's Acquisition of Arl-Zonolite Co. a) Agreement for the sale of stock of AriZonolite Co.* between W. R. Grace k Co. and C. H. Wendel dated August 17, 1966. b) Cash transaction - no documents filed with Securities and Exchange Commisslonspr New York Stock Exchange. W c) Copies of the following: Reques- for Capita. Appropriations. Analyses, profitability stud es, etc. that were made on this acquisitior. are contained in this document. d) There were no presr releases or written announcements to ct stomers, suppliers, or employees prepared by Grace on the purchase of Ari-Zonolite Co. assets and, to the best of our knowledge, there were no such releases `or announcements prepared by Ari-Zonolite Co. Item 5. The reasons for Grace's acquisition of the Zonolite Company were fully 3tated in response to the Commission's inquiry of Marcn lo, 1963 and the information set forth in Grace's letter dated April 1, 1963 addressed to the Commission is incorporated herein by reference. {Following is the information requested in respect of the acquisition of Perlits. Perlite, Incorporated was owned by two minor sons of Mr. H. W. Christopher, the latter having been killed in the year preceding the acquisition. Control of the company was exercised by the mother under a voting trust established by the court. Under these circumstances the parties in interest were extremely anxious to liquidate their investment in Perlite. Some Zonolite division customers request perlite because of its physical properties which make^Tnore satisfactory than veraiculite for certain end-uses. The addition of perlite manufacturing facilities Ln Southern Florida enables Grace to satisfy this customer demand. The Perlite, Incorporatid operation has become part of Grace's Zonolite division Florida region with the factory superintendent and sales personnel reporting to Zonolite's Regional Florida Manage-. 10027190