- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

----------------
FORM 10-K
(MARK
ONE)

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997

[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO

COMMISSION FILE NO. 1-4462

----------------
STEPAN COMPANY
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 36-1823834
- ------------------------------------- -------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)

Edens and Winnetka Road,
Northfield, Illinois 60093
- ------------------------------------- -------------------------------------
(Address of principal executive (Zip Code)
offices)
Registrant's telephone number including area code: 847-446-7500
Securities registered pursuant to Section 12 (b) of the Act:

NAME OF EACH EXCHANGE
TITLE OF EACH CLASS ON WHICH REGISTERED
------------------- ---------------------

Common Stock, $1 par value New York Stock Exchange
Chicago Stock Exchange
5 1/2% Convertible Preferred Stock, no New York Stock Exchange
par value Chicago Stock Exchange

Securities registered pursuant to Section 12 (g) of the Act:
None
-----------
(TITLE OF CLASS)

INDICATE BY CHECK MARK IF DISCLOSURE OF DELINQUENT FILERS PURSUANT TO ITEM
405 OF REGULATION S-K IS NOT CONTAINED HEREIN, AND WILL NOT BE CONTAINED, TO
THE BEST OF REGISTRANT'S KNOWLEDGE, IN DEFINITIVE PROXY OR INFORMATION
STATEMENTS INCORPORATED BY REFERENCE IN PART III OF THIS FORM 10-K OR ANY
AMENDMENT TO THIS FORM 10-K. [_]

INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS
REQUIRED TO BE FILED BY SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF
1934 DURING THE PRECEDING 12 MONTHS, AND (2) HAS BEEN SUBJECT TO SUCH FILING
REQUIREMENTS FOR THE PAST 90 DAYS. YES X NO

AGGREGATE MARKET VALUE AT FEBRUARY 28, 1998, OF VOTING STOCK HELD BY
NONAFFILIATES OF THE REGISTRANT:
$196,834,000.*

NUMBER OF SHARES OUTSTANDING OF EACH OF THE ISSUER'S CLASSES OF COMMON STOCK
AS OF FEBRUARY 28, 1998:

CLASS OUTSTANDING AT FEBRUARY 28, 1998
----- --------------------------------

9,881,000
Common Stock, $1 par value shares

DOCUMENTS INCORPORATED BY REFERENCE

PART OF FORM 10-K DOCUMENT INCORPORATED
----------------- ---------------------

Part I, Item 1 1997 Annual Report to Stockholders
Part II, Items 5-8 1997 Annual Report to Stockholders
Part III, Items 10-12 Proxy Statement dated March 27, 1998

*Based on reported ownership by all directors, officers and beneficial owners
of more than 5% of registrant's voting stock. However, this determination
does not constitute an admission of affiliate status for any of these
holders.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------

PART I

ITEM 1. BUSINESS

Stepan Company and its subsidiaries (the "company") produce specialty and
intermediate chemicals which are sold to other manufacturers and then made
into a variety of end products. The company sells three groups of products:
surfactants, polymers and specialty products. Surfactants refer to chemical
agents which affect the interaction between two surfaces; they can provide
actions such as detergency (i.e., the ability of water to remove soil from
another surface), wetting and foaming, dispersing, emulsification (aiding two
dissimilar liquids to mix), demulsification and viscosity modifications.
Surfactants are the basic cleaning agent in detergents for washing clothes,
dishes, carpets, fine fabrics, floors and walls. Surfactants are also used for
the same purpose in shampoos and conditioners, toothpastes, cosmetics and
other personal care products. Commercial and industrial applications include
emulsifiers for agricultural insecticides and herbicides, emulsion polymers
such as floor polishes and latex foams and coatings, wetting and foaming
agents for wallboard manufacturing and surfactants for enhanced oil recovery.
Polymers refer to intermediate chemicals including phthalic anhydride, polyols
and urethane foam systems used in plastics, building materials and
refrigeration industries. Specialty products consist of flavor and
pharmaceutical intermediates, fine chemicals, esters, synthetic lubricants and
other specialty products.

In 1993, Stepan Company entered into a 50 percent joint venture with
Coldequim, S.A. called Stepan Colombiana de Quimicos, Ltda in Colombia, South
America. Under the agreement, Stepan Colombiana manufactures selected
surfactants and markets the company's complete line of surfactants in the
Andean Pact countries of Colombia, Venezuela, Peru, Bolivia and Ecuador.

In 1994, Stepan Company entered into a 50 percent joint venture with United
Coconut Chemicals, Inc. and United Coconut Planters International in the
Philippines. The venture, called Stepan Philippines, Inc., manufactures
selected surfactants for sale in the Philippines and Asia/Pacific markets.

In 1996, the company acquired a sulfonation plant from Shell Group in
Cologne, Germany. This plant, organized as a German subsidiary, allows the
company to serve European customers with a wide range of sulfate and sulfonate
products used in household, personal care, individual, institutional and
agricultural markets.

In April 1997, the company acquired the West Coast anionic surfactant
business from Lonza, Inc. The acquisition enables the company to significantly
strengthen its market share in the personal care market in the West Coast
region. Also in 1997, in conjunction with Reichhold Chemicals, Inc., the
company expanded the production capacity of its Millsdale, Illinois, phthalic
anhydride plant from 180 million pounds to 240 million pounds. The expansion
was successfully started up in December of 1997.

MARKETING AND COMPETITION

Principal markets for all products are manufacturers of cleaning or washing
compounds (including detergents, shampoos, toothpastes and household
cleaners), paints, cosmetics, food and beverages, agricultural insecticides
and herbicides, plastics, furniture, building materials and automotive and
refrigeration equipment. Sales of the company tend not to be seasonal.

The company does not sell directly to the retail market, but sells to a wide
range of manufacturers in many industries and has many competitors. The
principal methods of competition are product performance, price and
adaptability to the specific needs of individual customers. These factors
allow the company to compete on a basis other than solely price, reducing the
severity of competition as experienced in the sales of commodity chemicals
having identical performance characteristics. The company is a leading
merchant producer of surfactants in the United States. In the case of
surfactants, much of the company's competition comes from the internal
divisions of larger companies, as well as several large national and regional
producers. In the manufacture of polymers, the company competes with the
chemical divisions of several large companies, as well as with other small
specialty chemical manufacturers. In recent years, the company has also faced
periodic competition from foreign imports of phthalic anhydride. In specialty
products, the company competes with several large firms plus

numerous small companies. The company does not expect any significant changes
in the competitive environment in the foreseeable future.

MAJOR CUSTOMER AND BACKLOG

The company does not have any one single customer whose business represents
more than 10% of the company's consolidated revenue. Most of the company's
business is essentially on the "spot delivery basis" and does not involve a
significant backlog. The company does have some contract arrangements with
certain customers, but purchases are generally contingent on purchaser
requirements.

ENERGY SOURCES

Substantially all of the company's manufacturing plants operate on
electricity and interruptable gas purchased from local utilities. During peak
heating demand periods, gas service to all plants may be temporarily
interrupted for varying periods ranging from a few days to several months. The
plants operate on fuel oil during these gas interruption periods. The company
has not experienced any plant shutdowns or adverse effects upon its business
in recent years that were caused by a lack of available energy sources.

RAW MATERIALS

The most important raw materials used by the company are of a petroleum or
vegetable nature. For 1998, the company has commitments from suppliers to
cover its forecasted requirements and is not substantially dependent upon any
one supplier.

RESEARCH AND DEVELOPMENT

The company maintains an active research and development program to assist
in the discovery and commercialization of new knowledge with the intent that
such effort will be useful in developing a new product or in bringing about a
significant improvement to an existing product or process. Total expenses for
research and development during 1997, 1996 and 1995 were $12,404,000,
$12,469,000, and $12,425,000, respectively. During 1997 and 1996, the research
and development staff consisted of 182 and 179 employees, respectively. The
balance of expenses reflected on the Consolidated Statements of Income relates
to technical services which include routine product testing, quality control
and sales support service.

ENVIRONMENTAL COMPLIANCE

Compliance with applicable federal, state and local regulations regarding
the discharge of materials into the environment, or otherwise relating to the
protection of the environment, resulted in capital expenditures by the company
of approximately $4,133,000 during 1997. Such capital expenditures in 1998
should approximate $4.0 to $5.0 million. These expenditures represented
approximately 12% of the company's capital expenditures in 1997 and are
expected to be 11% of such expenditures in 1998. These expenditures, when
incurred, are depreciated and charged on a straight-line basis to pre-tax
earnings over their respective useful lives which are typically 10 years.
Compliance with such regulations is not expected to have a material adverse
effect on the company's earnings and competitive position in the foreseeable
future.

EMPLOYMENT

At December 31, 1997 and 1996, the company employed worldwide 1,292 and
1,270 persons, respectively.

FOREIGN OPERATIONS

See Note 13, Geographic Data, on page 33 of the company's 1997 Annual Report
to Stockholders.

PRODUCT GROUPS

The manufacture of specialty and intermediate chemicals constitutes the
company's only industry segment. The company's three groups of products and
their contribution to sales for the three years ended December 31, 1997, were:

SPECIALTY
SURFACTANTS POLYMERS PRODUCTS
----------- -------- ---------

1997....................................... 77% 18% 5%
1996....................................... 75% 19% 6%
1995....................................... 72% 22% 6%

ITEM 2. PROPERTIES

The company's corporate headquarters and central research laboratories are
located in Northfield, Illinois. The Northfield facilities contain
approximately 70,000 square feet on an eight acre site. In addition, the
company leases 49,000 square feet of office space in a nearby office complex.

The Canadian sales office is located in Mississagua, Canada and is
approximately 2,300 square feet of leased space. Stepan Mexico maintains a
leased sales office in Mexico City, Mexico.

Surfactants are produced at four plants in the United States and four wholly
owned subsidiaries: one in France, Canada, Mexico and Germany. The principal
plant is located on a 626 acre site at Millsdale (Joliet), Illinois. A second
plant is located on a 39 acre tract in Fieldsboro, New Jersey. West Coast
operations are conducted on an eight acre site in Anaheim, California. A
fourth plant is located on a 162 acre site in Winder, Georgia. The plant,
laboratory and office of Stepan Europe are located on a 20 acre site near
Grenoble, France. Stepan Canada, Inc. is located on a 70 acre leased, with an
option to purchase, site in Longford Mills, Ontario, Canada. Stepan Mexico is
located on a 13 acre site in Matamoros, Mexico. Stepan Germany is located on a
five acre site in Cologne, Germany. The phthalic anhydride, polyurethane
systems and polyurethane polyols plants are also located at Millsdale.
Specialty products are mainly produced at a plant located on a 19 acre site in
Maywood, New Jersey.

The company owns all of the foregoing facilities except the leased office
space and Canadian plant site mentioned above. The company believes these
properties are adequate for its operations.

ITEM 3. LEGAL PROCEEDINGS

Reference is made to the company's Report Form 10-K for the year ended
December 31, 1995, and December 31, 1996, and the company's Report Form 10-Q
for the quarter ended September 30, 1993, September 30, 1994, September 30,
1995, and September 30, 1996, relating to the matter entitled United States v.
Lightman et al. C.A. No. 92 CV4710 (JVS) which is an action filed in the
United States District Court for the district of New Jersey in November 1992
by the United States to collect from the company and other potentially
responsible parties past costs at the D'Imperio Superfund site. On December
12, 1997, the Court enforced a proposed settlement of the United States past
cost claims and bound the company to payment of approximately $639,000. The
company has the right to appeal this decision at a later date. For now, the
company will make the payment of approximately $639,000. The allocation action
between the company and other PRPs is continuing and discovery at the site is
proceeding.

ITEM 4. RESULTS OF VOTES OF SECURITY HOLDERS

No matters were submitted to stockholders during the fourth quarter of the
fiscal year ended December 31, 1997.

EXECUTIVE OFFICERS OF THE REGISTRANT

Executive Officers are elected annually by the Board of Directors at the
first meeting following the Annual Meeting of Stockholders to serve until the
next annual meeting of the Board and until their respective successors are
duly elected and qualified.

Effective January 1, 1997, F. Quinn Stepan, Jr., was appointed Vice
President and General Manager--Surfactants. He was previously Vice President--
Global Laundry and Cleaning Products as of May, 1996 and Director--Business
Management as of May, 1992. Charles W. Given, formerly Vice President and
General Manager--Surfactants since April, 1992, was appointed Vice President--
Corporate Development.

Effective May 22, 1995, Jeffrey W. Bartlett, formerly Vice President,
General Counsel and Corporate Secretary, was appointed Vice President, General
Counsel, Regulatory Affairs and Corporate Secretary. Effective January 1,
1995, James A. Hartlage, who was formerly the Senior Vice President--
Technology, was appointed Senior Vice President--Technology and Operations. In
addition, during 1995 he assumed Administrative responsibilities. Effective
January 1, 1995, Earl H. Wagener, formerly Vice President--Product
Development, was appointed Vice President--Research and Development. All other
executive officers have remained in their current capacity for over five
years.

The Executive Officers of the company, their ages as of February 28, 1998,
and certain other information are as follows:

YEAR FIRST
NAME AGE TITLE ELECTED OFFICER
---- --- ----- ---------------

F. Quinn Stepan 60 Chairman, President and Chief Executive Officer 1967
James A. Hartlage 60 Senior Vice President--Technology and Operations 1980
Charles W. Given 61 Vice President--Corporate Development 1992
Ronald L. Siemon 60 Vice President and General Manager--Polymers 1992
Jeffrey W. Bartlett 54 Vice President, General Counsel, Regulatory Affairs 1983
and Corporate Secretary
Walter J. Klein 51 Vice President--Finance 1985
Mickey Mirghanbari 60 Vice President--Manufacturing and Engineering 1992
Earl H. Wagener 57 Vice President--Research and Development 1995
F. Quinn Stepan, Jr. 37 Vice President and General Manager--Surfactants 1997

PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED SECURITY HOLDER
MATTERS

(a) The company's common stock is listed and traded on both the New York
Stock Exchange and the Chicago Stock Exchange. See page 35 of the company's
1997 Annual Report to Stockholders for market price information which is
incorporated by reference herein.

The company's 5 1/2 percent convertible preferred stock is listed and traded
on the New York Stock Exchange and the Chicago Stock Exchange. See Note 7 on
page 30 of the company's 1997 Annual Report to Stockholders for the
description of the preferred stockholders' rights which is incorporated by
reference herein.

From time to time the company purchases shares of its common stock in the
open market and in block transactions from dealers for the purpose of funding
option grants under its stock option plans and deferred compensation plans for
directors and officers.

(b) On February 28, 1998, there were 1,574 holders of common stock of the
company.

(c) See page 35 of the company's 1997 Annual Report to Stockholders for
dividend information which is incorporated by reference herein. Also see Note
4 on page 28 of the company's 1997 Annual Report to Stockholders which sets
forth the restrictive covenants covering dividends.

ITEM 6. SELECTED FINANCIAL DATA

See page 34 of the company's 1997 Annual Report to Stockholders for a five
year summary of selected financial information which is incorporated by
reference herein.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

See pages 16 through 20 of the company's 1997 Annual Report to Stockholders
which is incorporated by reference herein.

Some information contained in the Management's Discussion and Analysis is
forward looking and involves risks and uncertainties. The results achieved
this year are not necessarily an indication of future prospects for the
company. Actual results in future years may differ materially. Potential risks
and uncertainties include, among others, fluctuations in the volume and timing
of product orders, changes in demand for the company's products, changes in
technology, continued competitive pressures in the marketplace, availability
of raw materials, foreign currency fluctuations and general economic
conditions.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

See pages 21 through 33 of the company's 1997 Annual Report to Stockholders
for the company's consolidated financial statements, notes to the consolidated
financial statements and auditors' report which are incorporated by reference
herein.

See page 35 of the company's 1997 Annual Report to Stockholders for selected
quarterly financial data which is incorporated by reference herein.

ITEM 9. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

(a) Directors

Mr. Paul Stepan is a general partner of a partnership having an interest
in certain real estate which is unrelated to the business of the company.
The partnership of which Mr. Paul Stepan is a general partner, has filed in
bankruptcy for Chapter 11 protection in February, 1998. Mr. Paul Stepan
advises that a refinancing package and successful discharge from Chapter 11
has occurred.

For additional information about the company's Directors, see pages 3
through 5 of the company's Proxy Statement dated March 27, 1998, for the
Annual Meeting of Stockholders which are incorporated by reference herein.

(b) Executive Officers

See Executive Officers of the Registrant in Part I above.

ITEM 11. EXECUTIVE COMPENSATION

See pages 6 and 7 of the company's Proxy Statement dated March 27, 1998, for
the Annual Meeting of the Stockholders which are incorporated by reference
herein.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

See pages 1 through 5 of the company's Proxy Statement dated March 27, 1998,
for the Annual Meeting of Stockholders which are incorporated by reference
herein.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

None

PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(a) & (d) FINANCIAL STATEMENTS AND SCHEDULES

See the Index to the Consolidated Financial Statements and Supplemental
Schedule filed herewith.

(b) REPORTS ON FORM 8-K

None

See Exhibit Index filed herewith.

SIGNATURES

PURSUANT TO THE REQUIREMENTS OF SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934, THE REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED
ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED.

Stepan Company

By: Jeffrey W. Bartlett
Vice President,
General Counsel,
Regulatory
Affairs and
Corporate
Secretary

March 27, 1998

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THIS
REPORT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS ON BEHALF OF THE
REGISTRANT AND IN THE CAPACITIES AND ON THE DATES INDICATED.

F. Quinn Stepan Chairman, President, Chief Executive March 27, 1998
____________________________________ Officer and Director
F. Quinn Stepan

Thomas F. Grojean Director March 27, 1998
____________________________________
Thomas F. Grojean

James A. Hartlage Senior Vice President--Technology March 27, 1998
____________________________________ and Operations and Director
James A. Hartlage

Walter J. Klein Vice President--Finance, Principal March 27, 1998
____________________________________ Financial and Accounting Officer
Walter J. Klein

Paul H. Stepan Director March 27, 1998
____________________________________
Paul H. Stepan

Robert D. Cadieux Director March 27, 1998
____________________________________
Robert D. Cadieux

Robert G. Potter Director March 27, 1998
____________________________________
Robert G. Potter

JEFFREY W. BARTLETT, PURSUANT TO POWERS OF ATTORNEY EXECUTED BY EACH OF THE
DIRECTORS AND OFFICERS LISTED ABOVE, DOES HEREBY EXECUTE THIS REPORT ON BEHALF
OF EACH OF SUCH DIRECTORS AND OFFICERS IN THE CAPACITY IN WHICH THE NAME OF
EACH APPEARS ABOVE.

Jeffrey W. Bartlett

March 27, 1998

INDEX TO THE
CONSOLIDATED FINANCIAL STATEMENTS
AND
SUPPLEMENTAL SCHEDULE

A copy of Stepan Company's Annual Report to Stockholders for the year ended
December 31, 1997, has been filed as an exhibit to this Annual Report on Form
10-K. Pages 21 through 33 of such Annual Report to Stockholders contain the
Consolidated Balance Sheets as of December 31, 1997 and 1996, the Consolidated
Statements of Income, Stockholders' Equity and Cash Flows and Notes to
Consolidated Financial Statements for the three years ended December 31, 1997,
1996 and 1995, and the Auditors' Report covering the aforementioned financial
statements. These consolidated financial statements and the Auditors' Report
thereon are incorporated herein by reference.

Supplemental Schedule II--Allowance for Doubtful Accounts--to Consolidated
Financial Statements, which is required to comply with regulation S-X, and the
Auditors' report on such Supplemental Schedule are included on pages 10 and 11
of this Form 10-K.

Certain supplemental schedules are not submitted because they are not
applicable or not required, or because the required information is included in
the financial statements or notes thereto.

STEPAN COMPANY

SUPPLEMENTAL SCHEDULE TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 1997
AS REQUIRED TO COMPLY WITH REGULATION S-X

SCHEDULE II--ALLOWANCE FOR DOUBTFUL ACCOUNTS:

Below is an analysis of the allowance for doubtful accounts for the three
years ended December 31:

1997 1996 1995
------ ------ ------
(IN THOUSANDS)

Balance, Beginning of Year........................ $2,074 $1,744 $1,585
Provision charged to income..................... 548 442 349
Accounts written off, net of recoveries......... (501) (112) (190)
------ ------ ------
Balance, End of Year.............................. $2,121 $2,074 $1,744
====== ====== ======

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
ON SUPPLEMENTAL SCHEDULE

To Stepan Company:

We have audited in accordance with generally accepted auditing standards,
the financial statements included in Stepan Company's Annual Report to
Stockholders incorporated by reference in this Form 10-K, and have issued our
report thereon dated February 11, 1998. Our audit was made for the purpose of
forming an opinion on those statements taken as a whole. The supplemental
schedule listed in the index of financial statements is the responsibility of
the company's management and is presented for purposes of complying with the
Securities and Exchange Commission's rules and is not part of the basic
financial statements. This schedule has been subjected to the auditing
procedures applied in the audit of the basic financial statements and, in our
opinion, fairly states in all material respects the financial data required to
be set forth therein in relation to the basic financial statements taken as a
whole.

Arthur Andersen LLP

Chicago, Illinois
February 11, 1998

EXHIBIT INDEX

EXHIBIT
NO. DESCRIPTION
------- -----------

(3)a Copy of the Certificate of Incorporation, and the Certificates
of Amendment of Certificate of Incorporation dated May 6, 1968,
April 20, 1972, April 16, 1973, December 2, 1983. Filed with
the company's Annual Report on Form 10-K for the year ended
December 31, 1983, and incorporated herein by reference.
(3)b Copy of the Bylaws of the company as amended through May 6,
1987. (Note 1)
(3)c Copy of Certificate of Amendment, dated April 28, 1993, to
Article IV of Certificate of Incorporation. (Note 7)
(3)d Copy of Certificate of Amendment, dated May 5, 1987, to Article
X of Certificate of Incorporation. (Note 1)
(4)h Copy of Loan Agreement dated June 15, 1995, with Aid
Association for Lutherans, the Northwestern Mutual Life
Insurance Company and The Mutual Life Insurance Company of New
York. (Note 10)
(4)i Copy of Revolving Credit and Term Loan Agreement dated February
20, 1990, with The First National Bank of Chicago and the
amendment dated March 21, 1990. (Note 3)
(4)m Copy of Second Amendment dated September 20, 1991, amending
Revolving Credit and Term Loan Agreement dated February 20,
1990 (see (4)i above). (Note 4)
(4)m(1) Copy of Third Amendment dated December 29, 1992, amending
Revolving Credit and Term Loan Agreement dated February 20,
1990 (see (4)i and (4)m above). (Note 8)
(4)m(2) Copy of Fourth Amendment dated May 31, 1994, amending Revolving
Credit and Term Loan Agreement dated February 20, 1990 (see
(4)i, (4)m and (4)m(1) above). (Note 9)
(4)n(1) Copy of Certificate of Designation, Preferences and Rights of
the 5 1/2% Convertible Preferred Stock, without Par Value and
the Amended Certificate dated August 12, 1992 and April 28,
1993. (Note 7)
(4)n(2) Copy of Issuer Tender Offer Statement on Schedule 13E-4 dated
August 13, 1992. (Note 6)
(4)n(3) Copy of Amendment No. 1 to Schedule 13E-4 (see also (4)n(2)
above) dated September 23, 1992. (Note 6)
(4)n(4) Copy of the company's Form 8-A dated August 13, 1992. (Note 6)
(4)o Copy of Revolving Credit and Term Loan Agreement dated January
9, 1998, with The First National Bank of Chicago.
In accordance with 601(b)(4) (iii) of Regulation S-K, certain
debt instruments are omitted, where the amount of securities
authorized under such instruments does not exceed 10% of the
total consolidated assets of the Registrant. Copies of such
instruments will be furnished to the Commission upon request.
(10)a Description of the 1965 Directors Deferred Compensation Plan.
(Note 2)
(10)b Copy of the 1969 Management Incentive Compensation Plan as
amended and restated as of January 1, 1992. (Note 5)
(10)d Copy of the 1982 Stock Option Plan. (Note 2)
(10)e Copy of Leveraged Employee Stock Ownership Plan. (Note 3)

EXHIBIT
NO. DESCRIPTION
------- -----------

(10)f Copy of the company's 1992 Stock Option Plan. (Note 5)
(13) Copy of the company's 1997 Annual Report to Stockholders.
(18) Letter re change in accounting principle for the year ended
December 31, 1992. (Note 8)
(21) Subsidiaries of Registrant at December 31, 1997.
(23) Consent of Independent Public Accountants.
(24) Power of Attorney.
(27) Financial Data Schedule.

NOTES TO EXHIBIT INDEX

NOTE
NO.
----

1. Filed with the company's Annual Report on Form 10-K for the year
ended December 31, 1987, and incorporated herein by reference.
2. Filed with the company's Annual Report on Form 10-K for the year
ended December 31, 1988, and incorporated herein by reference.
3. Filed with the company's Annual Report on Form 10-K for the year
ended December 31, 1989, and incorporated herein by reference.
4. Filed with the company's Quarterly Report on Form 10-Q for the
quarter ended September 30, 1991, and incorporated herein by
reference.
5. Filed with the company's Quarterly Report on Form 10-Q for the
quarter ended March 31, 1992, and incorporated herein by reference.
6. Filed with the company's Quarterly Report on Form 10-Q for the
quarter ended September 30, 1992, and incorporated herein by
reference.
7. Filed with the company's Current Report on Form 8-K filed on April
28, 1993, and incorporated herein by reference.
8. Filed with the company's Annual Report on Form 10-K for the year
ended December 31, 1992, and incorporated herein by reference.
9. Filed with the company's Annual Report on Form 10-K for the year
ended December 31, 1994, and incorporated herein by reference.
10. Filed with the company's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1995, and incorporated herein by reference.