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PLAIN TIFFS EXHIBIT CAM-7 AN ANALYSIS OF OUR TALC COMPETITORS !i5l Johns-Manville DESERTALC UNITED SIERRA DIVISION OF CYPRUS MINES CORPORATION I. HISTORY U SD is considered one of the largest talc producers in the world having mining, manufacturing, and distribution facilities in the United States, Europe, Mexico and other areas. Cyprus Mines Corporation acquired the Sierra Talc Com pany in 1964 and the Southwestern Talc Com pany in 1965. A s an independent producing company. Sierra Talc was one of the largest dom estic suppliers in the industry. Sierra Talc Com pany w as headquartered in South Pasadena, California, and w as a leader in the industry in research and technical development. They developed a broad line of products specialized for industry consumption with em phasis on ultra-fine or micronized products. Desert Minerals has been fortunate in acquiring much experience and knowledge in our association with individuals such a s Joe Ellsworth, D ick Lamar, and Norm an Scheffel who all were former employees of the Sierra Talc Com pany. This experience coupled with the superiority of our basic crude resources has been a fortunate combination which is now even further amplified with the resources of JohnsManville Corporation. II. GEOGRAPHY U S D has its headquarters and research facilities at Trenton, New Jersey, from which all activities are directed in talc a s well a s other non-metallic mineral products. U S D m ines and m ills talc in California, Montar, and Texas. Dom estic manufacturing facilities are located at Los Angeles, Keeler and Olancha, California; Three Forks, Montana; and Grand island, Nebraska. European business is operated through a subsidiary C M C-Sierra Corporation operating a facility at Ghent. Belgium, based on crude talc shipped from the United States and Australia. III. MINING U S D has historically purchased the bulk of their California talc from Grantham Mines, securing from them a uniform source of high-brightness, crude ore. U S D has not publicized this fact; rather, they have promoted the im age that they mine California talc from several active m ines in the Death Valley area of California. The two principal U SD mines that have been publicized are the Panamint and Ibex deposits which are som ewhat sim ilar to Grantham talcs in being tremolitic, but are not quite a s high brightness a s Grantham . U S D has historically built a rather broad range of products on the Grantham talc utilizing the high-brightness and uniformity features. The Montana operations of U S D are open pit from either the Yellowstone or Beaver head Mines. Yellowstone talc m ust be hand sorted to produce a com m ercial grade free from impurities of a steatite type talc. U S D Mistron Vapor is based on Yellowstone talc from Montana. Texas talc, a s supplied by the Southwestern Talc Corporation, is also open pit. Texas talc is grey to nearly black in color due to organic impurities which m ake the ground products relatively undesirable for paints and coatings, but ceram ic products fired at high temperatures are suitable because the talcs are white firing. IV . MANUFACTURING U S D processing plants are strategically located for the resources. Steatite and cosm etic grade talcs are processed at Keeler, California, on the west side of Death Valley. The Los Angeles operation processes primarily paint talcs shipped from Grantham and the Southern Death Valley area. Montana talcs are processed at Three Forks, Montana. A fourth mill located at Grand Island, Nebraska, was located at this point to proces talcs from either Montana or California enroute to the Eastern markets. The Grand Island location offers no advantage to processing California talcs other than it being a junction point for processing both California and M ontana source materials. B asic processing of crude talc at all U S D locations is the sam e a s our processing with the additional facilities of fluid energy milling for the production of the ultra-fine Mistron Vapor and Mistron Frost products. i V. M A R K ET IN G U S D products service ail the industries with which D E S E R T A L C S and C Y C L O N IZ E D products are serviced -- ceram ics, paint, plastics, paper, rubber, cosm etics, etcetera. U SD markets their products partially on a direct basis and partially through distributors. The direct sales organization is industry oriented with specialists traveling nationally out of Trenton and som e sale s offices in the Northeastern United States. Thompson-Hayward is the distributor in the Central and Southeastern states. Van W aters and Rogers is the distributor in the W est and Northwestern states. Table I is a data sheet defining the major U S D products by important properties. Due to product and specification changes, ail of the known products are not listed. Any old or new product numbers or designations that you encounter competitively that are not listed should be evaluated for current recommendations. In general, the Fibrene products are Raymond Mill grinds utilized by the paint and plastics industries. The Mistrons are ultra-fine or micronized products requiring additional processing after the Raymond Mill production. Our D E SE R T A LC M IK R O and C Y C L O N IZ E D product series are com parable to the Mistron series. Other speciality grades are often designated by the crude source or special nam es definitive for the industrial consumption. Your D ESER T A LC Competition Data Sheet provides our recom m endations for general usage. PFIZER, INC. I. HISTORY The talc operations are assigned to the M P M (Minerals, Pigm ents and M etals Division) and consist of the consolidated operations from several acquisitions. The basic isle w as initiated by the acquisition of C. K. W illiam s & Company in 1963. Prior to that, C. K. W illiam s had acquired the Kennedy Minerals Com pany of Los Angeles. Kennedy M inerals had operated a mineral processing plant in Los Angeles for several years and w as involved with Louise Grantham as described in the D ESER T A LC Business section of this Handbook by mining at W arm Springs under contract starting in 1943. Kennedy M inerals marketed talcs under the nam e of Kentalc, Fibre M, and Warm Springs Talc. Kennedy- Minerals operation in Los Angeles consisted essentially of Raym ond Mill production from which he supplied his products at 200 mesh to the ceram ic industry and at 325 m esh to the paint industry. The acquisition by C. K. W illiam s and subsequently by Pfizer of course did not include the Grantham Mine at W arm Springs Canyon, but it did include two other sm aller operating m ines in Death Valley called the Eclipse and the Death Valley Mines. Pfizer operated these m ines on a sm all scale and initiated the conversion of the Kennedy M inerals' nam es to a number system with the coined nam es Talcron. Then in 1966, Pfizer m ade an additional acquisition which implanted the M PM Division more firmly into the talc business. This acquisition w as that of Southern California Minerals Com pany with a mill in Los Angeles and a mill at Dunn, California. It is this Dunn Mill that w as placed into operation in 1963 by S C M C that is now owned by Johns-M anville for expansion of the Desert Minerals product line. This acquisition also included the purchase of the Tri-State M inerals Com pany and the Fine Pigm ents Corporation with plants and m ines at Barretts and Dillon, Montana. These Montana operations constituted a joint venture between Southern California M inerals Com pany and Whittaker, Clark & Daniels. S C M C operated the mines and production facilities and W C D exclusively marketed the finished products east of the Rocky Mountain states. It w as through W C D 's efforts that W CD 399 S F (Super Fine) becam e established in the Eastern paint industry a s the preferred micronized talc. M any other grades of Montana and California talcs were m arketed by W C D under a complex numbering system . W C D has continued to market selected products under a contract with Pfizer since the acquisition -- notably W C D 399 SF. Pfizer, thus, supplemented their initial acquisition with additional California mines in the Death Valley area under such nam es a s Apex, Acme, Monarch and Superior. In Montana, the Treasure and Regal M ines continue to supply. Pfizer has amplified the product line accordingly with additional tradem arks Cercron (ceram ic talcs) and Microtalc (micronized) along with a com plex numbering system . Pfizer's activities in the non- metalllc mineral business are supplemented with Eastern and W estern sources of calcium carbonates, barytes, and others. 2 TABLE I TYPICAL GRADES & PROPERTIES OF TALCS PRODUCED & MARKETED BY UNITED STATES DIVISION OF CYPRESS MINES CORPORATION G ratio P a rtic u la r Typo A cid Solub e s % as CaO Scroen F in e n e ss % Thru Hegm an F Enaness Panamint 96 P ia ty -A c ic u la r Fibrene C-300 A cicu lar-P laty 3.6 98-98.5/325 2-2.5 Fibrene C-400 Acicular-Platy 3.6 99.2-99.6/325 2-3 Fibrene C-500 Acicular-Platy 3.6 99.6-99.9/325 3-4 Trinity Super Platy 2.0 95-97/325 1-2* Trinity Superfine Platy 2.0 99.2-99.6/325 2-3* Supreme 200 Platy 0.5-1.5 95-97/325 0-1* Supreme 325 Platy 0.5-1.5 99.2-99.6/325 2.3* Supreme U SP Platy 0.5 99.2-99.6/325 2.3* Mistron 139 A cicular-Platy 3.6 100/325 4-5 Mistron 128 A c icu la r-P la ty 3.6 100/325 4.5-5.5 Mistron T-076 Acicular-Platy 3.6 100/325 5-6 Mistron HGO-75 Platy 0.5-1.5 100/325 5-5.5 Mistron HGO-55 Platy 0.5-1.5 100/325 5.5-6 Mistron Frost A cicu la r-P la ty 3.6 100/325 5.5-6 Mistron Vapor Platy 0.5-1.0 100/325 5.5-6.5 Mistron Monomix Platy 0.5-1.5 100/325 6-7 Oil A b so rp tio n Sp a tu la lb s / 1 0 0 lb s. A p p a re n t D e n sity L o o se Ib s/ F t3 C olor P h o to vo lt G roo n F ilte r 27-28 27-29 28-30 24-26* 26-39* 25-28* 27-29* 27-29* 35-37 38-40 42-44 50-52 55-60 48-50 55-60 55-60 23-24 22-23 19-21 25-26 23-24 26-27 21-22 21-22 14-16* 12-14* 10-12* 12-14* 10-12* 8-10* 6-8* 6-8* 93 93 93 90* 90* 90* 90* 90* 94 95 96 92 92 97 89 89 Above properties taken from the latest U SD published sp ecification s except where a ste risk s shown results are from our own laboratory tests. 9