Table of Contents
Performance Graph
UNITED
STATES SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
_____________________________
Form
10-K
|
R ANNUAL
REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF
1934
|
For
the Fiscal year ended December 31, 2006
OR
| £ TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
________________________________
Commission
File Number 1-13884
CAMERON
INTERNATIONAL CORPORATION
(Exact
name of Registrant as specified in its charter)
|
Delaware
|
76-0451843
|
|
(State
or other jurisdiction of incorporation or
organization)
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(I.R.S.
Employer Identification No.)
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1333
West Loop South
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Suite
1700
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Houston,
Texas
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77027
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|
(Address
of principal executive offices)
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(Zip
Code)
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Registrant’s
telephone number, including area code (713) 513-3300
SECURITIES
REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
|
Title
of Each Class
|
Name
of Each Exchange on Which Registered
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|
Common
Stock, Par Value $0.01 Per Share
|
New
York Stock Exchange
|
|
Junior
Participating Preferred Stock
|
|
|
Purchase
Rights
|
New
York Stock Exchange
|
|
Par
Value $0.01 Per Share
|
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined
in
Rule 405 of the Securities Act. Yes R
No
£
Indicate
by check mark if the registrant is not required to file reports pursuant
to
Section 13 or Section 15(d) of the Act. Yes £
No
R
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 (or for such shorter period that registrant was required
to
file such reports), and (2) has been subject to such filing requirements
for the
past 90 days. YesR
No
£
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 is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of “accelerated
filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check
one):
Large
accelerated filer R Accelerated
filer £Non-accelerated
filer £
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Act). Yes £
No
R
The
aggregate market value of the Common Stock, par value $0.01 per share, held
by
non-affiliates of registrant as of June 30, 2006, our most recently completed
second fiscal quarter, was approximately $4,527,523,419. For the purposes
of the
determination of the above statement amount only, all directors and executive
officers of the registrant are presumed to be affiliates. The number of shares
of Common Stock, par value $.01 per share, outstanding as of February 9,
2007,
was 112,530,879.
__________________________________
DOCUMENTS
INCORPORATED BY REFERENCE
Portions
of registrant’s Annual Report to Stockholders for the year ended December 31,
2006 are incorporated by reference into Parts I and II. Portions of the
registrant’s 2007 Proxy Statement for the Annual Meeting of Stockholders to be
held May 9, 2007 are incorporated by reference into Part III.
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At
the
Annual Meeting of Stockholders of the Company held on May 5, 2006, stockholders
voted to change the corporation’s name to Cameron International Corporation
(Cameron or the Company). Upon the change in the corporate name, the Company
also rebranded its three existing business segments into Drilling &
Production Systems (DPS), formerly the Cameron segment; Valves & Measurement
(V&M), formerly the Cooper Cameron Valves segment; and Compression Systems
(CS), formerly the Cooper Compression segment. For additional business segment
information for each of the three years in the period ended December 31,
2006,
see Note 14 of the Notes to Consolidated Financial Statements, which Notes
are
incorporated herein by reference in Part II, Item 8 of this Annual Report
on
Form 10-K (Notes to Consolidated Financial Statements).
Cameron
is a leading international manufacturer of oil and gas pressure control and
separation equipment, including valves, wellheads, controls, chokes, blowout
preventers and assembled systems for oil and gas drilling, production and
transmission used in onshore, offshore and subsea applications and provides
oil
and gas separation, metering and flow measurement equipment. Cameron is also
a
manufacturer of centrifugal air compressors, integral and separable gas
compressors and turbochargers. See “Glossary of Terms” at the end of Item 1 for
definitions of certain terms used in this section. Any reference to Cameron
International Corporation, its divisions or business units within this paragraph
or elsewhere within this Form 10-K as being a leader, leading provider, leading
manufacturer, or having a leading position is based on the amount of equipment
installed worldwide and available industry data.
Cameron’s
origin dates back to the mid-1800s with the manufacture of steam engines
that
provided power for plants and textile or rolling mills. By 1900, with the
discovery of oil and gas, Cameron’s predecessors moved into the production of
internal combustion engines and gas compressors. Product offerings were added
by
the Company’s predecessors through various acquisitions, in particular the
acquisitions of The Bessemer Gas Engine Company (gas engines and compressors);
Pennsylvania Pump and Compressor (reciprocating air and gas compressors);
Ajax
Iron Works (compressors); Superior (engines and compressors); Joy Petroleum
Equipment Group (valves, couplings and wellheads); Joy Industrial Compressor
Group (compressors); and Cameron Iron Works (blowout preventers, ball valves,
control equipment and McEvoy-Willis wellhead equipment and choke
valves).
Cameron,
a Delaware corporation, was incorporated on November 10, 1994. The Company
operated as a wholly-owned subsidiary of Cooper Industries, Inc. until June
30,
1995, the effective date of the completion of an exchange offer with Cooper
Industries’ stockholders resulting in the Company becoming a separate
stand-alone company. The common stock of Cameron trades on the New York Stock
Exchange under the symbol “CAM”. The Company’s Internet address is www.c-a-m.com.
General
information about Cameron, including its Corporate Governance Principles,
charters for the committees of the Company’s board of directors, Standards of
Conduct, and Codes of Ethics for Management Personnel, including Senior
Financial Officers and Directors, can be found in the Ethics and Governance
section of the Company’s website. The Company makes available, free of charge,
on its website the annual reports on Form 10-K, quarterly reports on Form
10-Q,
current reports on Form 8-K and amendments to those reports filed or furnished
pursuant to Section 13(a) or 15(d) of the Securities and Exchange Act of
1934,
as amended (the Exchange Act) as soon as reasonably practicable after the
Company electronically files or furnishes them to the Securities and Exchange
Commission (the SEC).
Since
its
inception, the Company has completed several acquisitions, including the
assets
of Ingram Cactus Company in 1996, Orbit Valve International Inc. in 1998,
Stewart and Stevenson’s Petroleum Equipment segment and Nutron Industries in
2002, Petreco International Inc. and the PCC Flow Technologies segment of
Precision Castparts Corp. (PCC) in 2004, and NuFlo Technologies, Inc. and
the
On/Off Valve business unit of the Flow Control segment of Dresser, Inc. in
2005.
In January 2006, the Company also acquired the assets and liabilities of
Caldon,
Inc. which added a new ultrasonic measurement product line to the existing
flow
management product line in the V&M segment.
Additionally,
the Company also sold certain of its business operations, including its Wheeling
Machine Products division in 1995, a rotating compressor product line in
1999
and certain Canadian aftermarket operations in 2000.
Business
Segments
Drilling
& Production Systems Segment
DPS
is
one of the world’s leading providers of systems and equipment used to control
pressures, direct flows of oil and gas wells and separate oil and gas from
impurities. Its products are employed in a wide variety of operating
environments including basic onshore fields, highly complex onshore and offshore
environments, deepwater subsea applications and ultra-high temperature
geothermal operations.
DPS’s
products include surface and subsea drilling and production systems, control
systems, blowout preventers (BOPs), oil and gas separation equipment, gate
valves, actuators, chokes, wellheads, drilling riser and aftermarket parts
and
services. DPS’s products are marketed under the brand names CAMERON®, W-K-M®,
MCEVOY® and WILLIS®. Additionally, DPS manufactures elastomers, which are used
in pressure and flow control equipment and other petroleum industry
applications, as well as in the petroleum, petrochemical, rubber molding
and
plastics industries.
DPS
is
one of the leading global suppliers of integrated drilling systems for land,
offshore, platform and subsea applications. Drilling equipment designed and
manufactured by DPS includes ram and annular BOPs, drilling risers, drilling
valves, choke and kill manifolds, surface and subsea BOP control systems,
multiplexed electro-hydraulic (MUX) control systems and diverter systems.
DPS
also provides services under CAMCHEC™, an inspection system that allows drilling
contractors to inspect drilling riser on their rigs offline, saving time
and
money on maintenance and unnecessary transportation.
With
oil
and gas prices at historical highs, and with world oil demand expected to
continue to grow, demand for drilling rigs led to full utilization in most
sectors during 2006 with oil companies entering into long-term contracts
for
available rigs at unprecedented day rates, the reactivation of previously
cold-stacked rigs and an escalation in newbuild rig activity. As a result,
DPS
experienced a record year in bookings for surface and subsea drilling products
during 2006, further reinforcing Cameron’s role as a primary supplier of BOPs
and related equipment to the industry. In order to meet this increased demand
for drilling products, the Company has increased its investment in machine
tools
for its manufacturing facilities in Berwick, Louisiana, Beziers, France and
Houston, Texas, including the development of a state-of-the-art riser
fabrication and assembly facility in Beziers.
DPS
is
also a global market leader in supplying surface production equipment, from
conventional to high-pressure, high temperature (HPHT) wellheads and API
Christmas trees and chokes used on land or installed on offshore
platforms.
The
surface business, which has a global base of installed equipment and an
aftermarket presence in virtually every major hydrocarbon-producing region
around the world, remains the largest revenue contributor to the DPS segment.
This business saw increased order levels in 2006 from most major regions
around
the world.
DPS
continues to be a leader in providing subsea wellheads, Christmas trees,
manifolds, and production controls to customers worldwide, from basic tree
orders to integrated solutions that require systems engineering and project
management as well as installation and aftermarket support. DPS’s Subsea Systems
organization, created in 2005, has global responsibility for research and
development, engineering, sales, manufacturing, installation and aftermarket
support for subsea products and systems, and provides customers with integrated
solutions to subsea field development requirements under engineering,
procurement and construction contracts.
In
order
to address capacity needs, improve efficiency and lower manufacturing costs
in
the subsea product line, the Company began construction in mid-2006 on a
new
subsea manufacturing center in Johor, Malaysia. This $32 million investment
includes a state-of-the-art manufacturing, assembly and test plant, and is
expected to be in operation by the fourth quarter of 2007. Additional
investments have been made in the Company’s subsea tree production facilities in
Leeds, England and Taubate, Brazil and at the Company’s facility in Celle,
Germany where control systems for subsea trees are manufactured.
As
petroleum exploration activities have increasingly focused on subsea locations,
DPS has directed much of its new product development efforts toward this
market.
DPS’s patented SpoolTree™ horizontal subsea production system, which was
introduced in 1993, is used in oil and gas fields with subsea completions
that
require frequent retrieval of downhole equipment. With the SpoolTree system,
well completion and workover activities can be performed without a workover
riser or removal of the Christmas tree and under conventional blowout preventer
control, thereby reducing the time, equipment and expense needed to perform
such
activities.
DPS
advanced its tradition of innovation with the introduction in 2004 of an
all-electric, direct current powered subsea production system, CameronDC™, which
is designed to offer greater reliability and provide substantial cost savings
to
customers.
DPS’s
Flow Control group was formed to focus resources on the choke product line
with
the goal of enhancing DPS’s performance in this product line. Flow Control
manufactures Cameron and Willis brand chokes and Cameron brand actuators
for the
surface and subsea production and drilling markets as well as drilling choke
control panels and surface wellhead safety systems. The Company’s primary choke
manufacturing operations are located in Longford, Ireland, and its primary
surface gate valve actuator manufacturing operations are located at the Flow
Control plant in Houston, Texas.
During
2006, the Flow Control product line was expanded with the addition of the
LEDEEN® quarter-turn actuator line, acquired as part of the Dresser On/Off Valve
business unit acquisition in late 2005. This product line is manufactured
at the
Company’s newly acquired facility in Voghera, Italy. Also, during 2006, the
surface choke product line was expanded as Flow Control began producing AOP
brand surface chokes in its Houston, Texas facility.
Petreco
Processing Systems produces highly engineered equipment, systems and services
for oil, gas, water and solids separation. Petreco’s products include
electrostatic desalters and dehydrators, hydrocyclones, desanders, floatation
equipment, processing equipment, gas processing equipment and
electrochlorinators. These products are marketed under the brand names PETRECO®,
VORTOIL®, KREBS®, UNICEL®, WEMCO®, METROL™, KCC™, DEPURATOR® and
BFCC™.
DPS’s
worldwide aftermarket service program, CAMSERV™, provides replacement parts for
equipment through a comprehensive global network. In recent years, DPS has
continued to enhance its aftermarket presence worldwide with new or upgraded
facilities in Brazil, Mexico, Angola, Newfoundland, and Onne Port,
Nigeria.
DPS’s
research center, located in Houston, Texas, has ten specially designed test
bays
to test and evaluate DPS’s products under realistic conditions. These include
environmental test chambers to simulate extreme pressures and temperatures,
high-strength fixtures for the application of multi-million pound tensile
and
bending loads, high-pressure gas compressors and test enclosures, a hyperbaric
chamber to simulate the external pressures of deepwater environments, and
two
circulation loops for erosion and flow testing.
DPS
primarily markets its products directly to end-users through a worldwide
network
of sales and marketing employees, supported by agents in some international
locations. Due to the technical nature of many of the products, the marketing
effort is further supported by a staff of engineering employees.
DPS’s
primary customers include oil and gas majors, independent producers, engineering
and construction companies, drilling contractors, rental companies and
geothermal energy producers.
Valves
& Measurement Segment
V&M
is a leading provider of valves and measurement systems primarily used to
control, direct and measure the flow of oil and gas as they are moved from
individual wellheads through flow lines, gathering lines and transmission
systems to refineries, petrochemical plants and industrial centers for
processing. Equipment used in these environments is generally required to
meet
demanding standards, including API 6D and the American Society of Mechanical
Engineers (ASME).
V&M’s
products include gate valves, ball valves, butterfly valves, Orbit® valves,
block & bleed valves, plug valves, globe valves, check valves, actuators,
chokes and aftermarket parts and services. Measurement products include
totalizers, turbine meters, flow computers, chart recorders, ultrasonic flow
meters and sampling solutions.
In
November 2005, the Company completed the acquisition of the On/Off Valve
business unit of the Flow Control segment of Dresser, Inc., except for a
portion
of the business which was acquired in January 2006. Efforts to integrate
this
business, mostly in the V&M segment, were largely completed by the end of
2006. The inclusion of this business in the V&M segment, as well as strong
market conditions, were the major contributors to the growth in the V&M
segment’s orders, revenues and profitability in 2006.
V&M’s
Distributed Valves group manufactures valves which are sold through distributed
networks, primarily in North America, for use in oil and gas applications
and
are marketed under the brand names WKM®, DEMCO®, NUTRON®, TBV®, AOP®, THORNHILL
CRAVER®, TEXSTEAM® and WHEATLEY®.
The
Engineered Valves group of V&M provides large-diameter valves for use in
natural gas, liquefied natural gas (LNG), crude oil and refined products
transmission lines. Products are marketed under the brand names CAMERON®,
GROVE®, RING-O® and TOM WHEATLEY®.
V&M’s
Processed Valves group provides critical service valves for refinery, chemical
and petrochemical processing businesses and for associated storage terminal
applications, particularly through the ORBIT AND GENERAL® valve product lines.
Other products include TK® and ENTECH® check valves and WKM® and FOSTER® gate
valves.
The
Measurement Systems group of V&M designs, manufactures and distributes
instrumentation for the oil and gas and process control industries to be
used
for the measurement and control of pressures, temperatures, levels and flows.
The four main product lines of this group are NUFLO™, BARTON®, CALDON® and CLIF
MOCK™.
The
V&M segment also provides aftermarket services including OEM parts, repair,
field service, asset management and remanufactured product to customers,
particularly in support of the installed base of equipment sold under the
numerous brands within the expanded V&M businesses.
V&M
markets its equipment and services through a worldwide network of combined
sales
and marketing employees, distributors and agents in selected international
locations. Due to the technical nature of many of the products, the marketing
effort is further supported by a staff of engineering employees.
V&M’s
primary customers include oil and gas majors, independent producers, engineering
and construction companies, pipeline operators, drilling contractors and
major
chemical, petrochemical and refining companies.
Compression
Systems Segment
CS
is a
provider of reciprocating and centrifugal compression equipment and aftermarket
parts and services. Reciprocating compression equipment (Reciprocating
Technology) is used throughout the energy industry by gas transmission
companies, compression leasing companies, oil and gas producers and independent
power producers. Integrally geared centrifugal compressors (Centrifugal
Technology) are used by customers around the world in a variety of industries,
including air separation, petrochemical and chemical. CS’s products include
aftermarket parts and services, integral engine-compressors, separable
compressors, turbochargers, integrally geared centrifugal compressors,
compressor systems and controls. Its aftermarket services include spare parts,
technical services, repairs, overhauls and upgrades.
The
CS
Reciprocating Technology group provides reciprocating compression equipment
and
related aftermarket parts and services for the oil and gas industry. Its
products and services are marketed under the AJAX®, SUPERIOR®, COOPER-BESSEMER®,
PENN™, ENTERPRISE™, TEXCENTRIC®, COMPRESSION SPECIALTIES™, and TURBINE
SPECIALTIES™ brand names. CS provides global support for its products and
maintains sales and/or service offices in key international locations. Ajax
integral engine-compressors, which combine the engine and compressor on a
single
drive shaft, are used for gas re-injection and storage, as well as on smaller
gathering and transmission lines. Superior-brand separable compressors are
used
primarily for natural gas applications, including production, storage,
withdrawal, processing and transmission, as well as petrochemical processing.
These high-speed separable compressor units can be matched with either natural
gas engine drivers or electric motors.
Two
new
product offerings in the reciprocating product line are reflected in the
2006
results. The Axis™ reciprocating compressor is an all-new barrel-frame design
targeted at the natural gas lease fleet markets. The new C-Force™ compressor was
created through the addition of new tandem cylinders to a small Superior
reciprocating frame, providing an offering suited to compressed natural gas
(CNG) applications.
For
the
year ended December 31, 2006, approximately 69% of the Reciprocating Technology
revenues are generated by aftermarket parts and services in support of the
Company’s worldwide installed base of compression equipment.
Customers
for Reciprocating Technology products include gas transmission companies,
compression leasing companies, oil and gas producers and processors and
independent power producers.
The
CS
Centrifugal Technology group manufactures and supplies integrally geared
centrifugal compressors and provides aftermarket services to customers
worldwide. Centrifugal air compressors, used primarily in manufacturing
processes (plant air), are sold under the trade name of Turbo-Air®, with
specific models including the TA-2000, TAC-2000, TA-3000, TA-6000 and TA-9000.
Engineered
compressors are used in the process air and gas industries and are identified
by
the MSG® trade name. The process and plant air centrifugal compressors deliver
oil-free compressed air and other gases to customers, thus preventing oil
contamination of the finished products.
New
product offerings planned for 2007 include the MSG80 and the TA-2040. The
MSG80
will be the largest compressor made by Cameron and will target the air
separation market, especially steel manufacturers. The TA-2040 will be a
high
pressure compressor to be sold into the plastic bottle blowing
market.
Compression
Systems provides installation and maintenance service, parts, repairs, overhauls
and upgrades to its worldwide customers for plant air and process gas
compressors. It also provides aftermarket service and repairs on all equipment
it produces through a worldwide network of distributors, service centers
and
field service technicians utilizing an extensive inventory of
parts.
Centrifugal
Technology customers include petrochemical and refining companies, natural
gas
processing companies, durable goods manufacturers, utilities, air separation
and
chemical companies.
Cameron
is one of the leaders in the global market for the supply of petroleum
production equipment. Cameron believes that it is well-positioned to serve
these
markets. Plant and service center facilities around the world in major oil-
and
gas-producing regions provide a broad market coverage. Information relating
to
revenues generated from shipments to various geographic regions of the world
is
set forth on page 25 of “Management’s Discussion and Analysis of Operations and
Financial Condition of Cameron International Corporation” incorporated by
reference in Part II, Item 7 of this Annual Report on Form 10-K and incorporated
herein by reference.
The
global market continues to be a source of growth for Cameron. This was
particularly evident with regard to a surge in demand for additional drilling
rigs in 2006 by oil companies worldwide. The desire to expand oil and gas
resources and transmission capacity in developed and developing countries,
for
both economic and political reasons, continues to be a major factor affecting
market demand. Additionally, establishment of industrial infrastructure in
the
developing countries will necessitate the growth of basic industries that
require plant air and process compression equipment. Production and service
facilities in North and South America, Europe, the Far and Middle East and
West
Africa provide the Company with the ability to serve the global
marketplace.
In
each
of Cameron’s business segments, a large population of installed engines,
compression equipment and oil and gas production equipment exists in the
worldwide market. The long-lived nature of the equipment provides a relatively
stable repair parts and service business. However, with respect to Compression
Systems, approximately 37% of that segment’s 2006 revenues came from the sale of
replacement parts for equipment that the Company no longer manufactures.
Many of
these units have been in service for long periods of time and are gradually
being replaced. As this installed base of legacy equipment declines, the
Company’s potential market for parts orders is also reduced. In recent years,
the Company’s revenues from replacement parts associated with legacy equipment
have declined nominally.
In
recent
years, DPS has been expanding into the deepwater subsea systems market. This
market is significantly different from the Company’s other markets since
deepwater subsea systems projects are significantly larger in scope and
complexity, in terms of both technical and logistical requirements. Subsea
projects (i) typically involve long lead times, (ii) typically are larger
in
financial scope, (iii) typically require substantial engineering resources
to
meet the technical requirements of the project and (iv) often involve the
application of existing technology to new environments and in some cases,
the
application of new technology. These projects accounted for approximately
8% of
the Company’s consolidated revenues for the year ended December 31, 2006. To the
extent the Company experiences difficulties in meeting the technical and/or
delivery requirements of the projects, the Company’s earnings or liquidity could
be negatively impacted. As of December 31, 2006, the Company had a subsea
systems project backlog of approximately $408.7 million.
Also,
see
Part I, Item 1A for a discussion of other risk factors, some of which are
market
related, that could affect the Company’s financial condition and future
results.
Cameron
introduced several drilling products during the last several years. These
products include the 3.5 million-pound load capacity LoadKing™ riser system,
used for drilling in up to 10,000-foot water depths; a lightweight and
lower-cost locking
mechanism
for subsea BOPs; a new generation of variable-bore ram packers; a Freestanding
Drilling Riser, and an Environmental Safe Guard system.
Other
Cameron-developed products include the patented SpoolTree™ subsea production
system; the CAMTROL system that includes all of Cameron’s controls capabilities
of production, drilling and workover; and the CameronDC subsea production
system, which is the world’s first all-electric direct current-powered subsea
production system, designed for increased reliability and improved performance
in deepwater applications. Initial deployment of the CameronDC subsea production
system is planned for mid-2007 in the Dutch North Sea.
During
2005, Cameron introduced a new subsea controls system that combines the
traditional subsea control module and the subsea accumulator module in a
single
package, allowing for more efficient operation of the subsea tree and manifold
valves. Additionally, a new state-of-the-art subsea test chamber in Cameron’s
controls engineering facility in Celle, Germany facilitates testing of the
Company’s control system.
Also
in
2005, Cameron launched its updated CAMTROL subsea control module, which includes
new electronics, lower power demand, a DC power option and fiber optic
communications to further increase reliability and enable extended offset
developments and high-bandwidth intelligent completions.
Cameron
has also formed a joint venture with Curtiss-Wright EMD, with plans to combine
Curtiss-Wright’s motor and pump expertise with Cameron’s subsea technologies to
develop integrated subsea multiphase pumping systems.
In
2006,
Subsea Systems and Petreco introduced their two-phase and three-phase subsea
separation systems, developed through a joint technology team originally
formed
in 2005.
During
2005, DPS’s Flow Control group introduced a new three-inch underbalanced
drilling choke, the DR30, in response to drilling customers’ increasing demand
for higher-capacity chokes for use in underbalanced drilling
applications.
Compression
Systems’ product range was expanded through the addition of compressor frames
(TAC-2000, TA-2020, TA-3000, TA-6000 and TA-9000) and the addition of
trademarked accessories such as Dry Pak heat of compression dryers and
Turboblend, a hydro-cracked turbomachinery lubricating oil. Compression Systems’
Engineered Compressor product line was redefined and the MSG Renaissance
program
was introduced to update the MSG product line.
Compression
Systems has focused product development resources to further expand its
high-efficiency plant air compressor line and to provide engineered compressors
matched to the requirements of its customers. The latter is being achieved
by
advances in aerodynamic and rotor dynamic analytical design capability and
the
addition of centrifugal gas applications.
Two
new
offerings were introduced in 2005 in the reciprocating product line. The
AXIS™
reciprocating compressor is an all-new barrel-frame design targeted at the
natural gas lease fleet markets. The new C-Force™ compressor was created through
the addition of new tandem cylinders to a small Superior reciprocating frame,
providing an offering ideally suited to compressed natural gas
applications.
Compression
Systems plans to add two additional products to its centrifugal line in 2007
-
the MSG80 and TA-2040, both discussed previously.
Cameron
competes in all areas of its operations with a number of other companies,
some
of which have financial and other resources comparable to or greater than
those
of Cameron.
Cameron
has a leading position in the petroleum production equipment markets. In
these
markets, Cameron competes principally with Aker Kvaerner, Balon Corporation,
Circor International, Inc., Daniel Flow Measurement Division of Emerson Process
Management, Dril-Quip, Inc., FlowServ Corp., FMC Technologies, Inc., GE Oil
& Gas Group, Hanover Compressor Company, Hydril Company, Masterflo (a
division of Steam-Flo Industries Ltd.), NATCO Group, Inc., National Oilwell
Varco Inc., PBV-USA, Inc. (a Zy-Tech Global Industries company), Petrovalve
(a
Flotek Industries, Inc. company), Pibiviese, T3 Energy Services Inc., Tyco
International Ltd., Valve Automation division of Emerson Process Management,
Vetco International, Ltd. (in January 2007, it was
announced
that General Electric had reached an agreement to purchase Vetco Gray, the
oil
and gas business unit of Vetco International, Ltd.), Wood Group and Worldwide
Oilfield Machinery, Inc.
The
principal competitive factors in the petroleum production equipment markets
are
technology, quality, service and price. Cameron believes several factors
give it
a strong competitive position in these markets. Most significant are Cameron’s
broad product offering, its worldwide presence and reputation, its service
and
repair capabilities, its expertise in high-pressure technology and its
experience in alliance and partnership arrangements with customers and other
suppliers.
Cameron
also has a strong position in the compression equipment markets. In these
markets, Cameron competes principally with the Ariel Corporation, Atlas-Copco
AB, CECO (a Compressor Engineering Corporation company), Demag, Dresser-Rand
Company, FS-Elliott Company, LLC, Endyn Energy Dynamics, Hoerbiger Group,
IR Air
Solutions, TCS and Universal Compression. The principal competitive factors
in
the compression equipment markets are engineering and design capabilities,
product performance, reliability, quality, service and price. Cameron has
a
competent engineering staff and skilled technical and service
representatives.
Cameron
has manufacturing facilities worldwide that conduct a broad variety of
processes, including machining, fabrication, assembly and testing, using
a
variety of forged and cast alloyed steels and stainless steel as the primary
raw
materials. In recent years, Cameron has rationalized plants and products,
closed
various manufacturing facilities, moved product lines to achieve economies
of
scale, and upgraded other facilities. This is an ongoing process as the Company
seeks ways to improve delivery performance and reduce costs. Cameron maintains
advanced manufacturing, quality assurance and testing equipment geared to
the
specific products that it manufactures and uses process automation in its
manufacturing operations. Manufacturing facilities typically utilize
computer-aided, numeric-controlled tools and manufacturing techniques that
concentrate the equipment necessary to produce similar products in one area
of
the plant in a configuration commonly known as a manufacturing cell. One
operator in a manufacturing cell can monitor and operate several machines,
as
well as assemble and test products made by such machines, thereby improving
operating efficiency and product quality.
Cameron’s
test capabilities are critical to its overall processes. The Company has
the
capability to test most equipment at rated operating conditions, measuring
all
operating parameters, efficiency and emissions. All process compressors for
air
separation and all plant air compressors are given a mechanical and aerodynamic
test in a dedicated test center prior to shipment.
All
of
Cameron’s Asian, European and Latin American manufacturing plants are ISO
certified and API licensed, and most of the U.S. plants are ISO certified.
ISO
is an internationally recognized verification system for quality
management.
Cameron’s
backlog was approximately $3.531 billion at December 31, 2006 (approximately
78%
of which is expected to be shipped during 2007), as compared to $2.156 billion
at December 31, 2005, and $1.0 billion at December 31, 2004. Backlog consists
of
customer orders for which a purchase order has been received, satisfactory
credit or financing arrangements exist and delivery is scheduled.
As
part
of its ongoing research, development and manufacturing activities, Cameron
has a
policy of seeking patents when appropriate on inventions involving new products
and product improvements. Cameron owns 305 unexpired United States patents
and
613 unexpired foreign patents. During 2006, 27 new U.S. and 66 new foreign
patent applications were filed.
Although
in the aggregate these patents are of considerable importance to the
manufacturing of many of its products, Cameron does not consider any single
patent or group of patents to be material to its business as a
whole.
Trademarks
are also of considerable importance to the marketing of Cameron’s products.
Cameron considers the following trade names to be material to its business
as a
whole: CAMERON, COOPER-BESSEMER, AJAX, WILLIS and W-K-M. Other important
trademarks used by Cameron include AOP, AXIS, BARTON, BFCC, C-B TURBOCHARGER,
CAMCHEC, CAMERONDC, CLIF MOCK, CONTROL SEAL, CSI, DEMCO, DEPURATOR, DRYPAK,
DYNACENTRIC, DYNASEAL, EDGE, ENTECH, ENTERPRISE, FOSTER, GENERAL VALVE, GENUINE
JOY, GROVE, H & H, IC, INTERNATIONAL VALVES LTD. (U.K.), KCC, KREBS, LEDEEN,
MCEVOY, METROL, MSG, NAVCO, NORTH STAR, NUFLO TECHNOLOGIES, INC., NICKLES
INDUSTRIAL,
NUTRON, ORBIT, PENN, PETRECO, POW-R-SEAL, QUAD 2000, RING-O, SAF-T-SEAL,
SPOOLTREE, STEROM, SUPERIOR, TA, TBV, TECHNO, TEXCENTRIC, THORNHILL CRAVER,
TRUSEAL, TURBINE SPECIALTIES (RECIPROCATING PRODUCTS), TK VALVE, TEXSTEAM,
TOM
WHEATLEY, TSI, TUNDRA, TURBO AIR, TWINSEAL, TXT, UNICEL, VALOR, VANTAGE,
VORTOIL, WEMCO, WHEATLEY and others. Cameron has registered trademarks in
countries where such registration is deemed important.
During
2006, the Company acquired the assets and liabilities of Caldon Inc. This
acquisition included the trademark Caldon.
Cameron
has the right to use the trademark Joy on aftermarket parts until November
2027.
Cameron
also relies on trade secret protection for its confidential and proprietary
information. Cameron routinely enters into confidentiality agreements with
its
employees, partners and suppliers. There can be no assurance, however, that
others will not independently obtain similar information or otherwise gain
access to Cameron’s trade secrets.
As
of
December 31, 2006, Cameron had approximately 12,400 employees, of which
approximately 3,000 were represented by labor unions. Over 1,250 of these
employees are covered by contracts expiring in 2007. Approximately 634 employees
at the Company’s plants in Italy are under contracts which expire in mid-2007.
In Brazil, the Company has approximately 492 employees at its facilities
with
contracts expiring on various dates in the second half of 2007.
During
2006, new three-year agreements were reached with the International Association
of Machinists and Aerospace Workers covering approximately 247 employees
at the
Company’s Centrifugal Technology facility in Buffalo, New York and approximately
59 employees at a DPS facility in Brookshire, Texas. In addition, a new three
and one-half year agreement was entered into in January 2006 covering
approximately 349 employees at the Company’s Leeds, England facility. The
Company also entered into a new one-year agreement during 2006, which will
expire in the third quarter of 2007, covering approximately 125 employees
at a
newly acquired facility in Brazil.
|
Name
and Age
|
Present
Principal Position and Other Material Positions Held During Last
Five
Years
|
|
Sheldon
R. Erikson (65)
|
Chief
Executive Officer since January 1995. President from January 1995
to
December 2006. Chairman of the Board of Directors since May 1996.
Chairman
of the Board from 1988 to April 1995 and President and Chief Executive
Officer from 1987 to April 1995 of The Western Company of North
America.
|
|
Jack
B. Moore (53)
|
President
and Chief Operating Officer since January 2007. Senior Vice President
since July 2005. Vice President from May 2003 to July 2005. President,
Drilling and Production Systems from July 2002 to December 2006.
Vice
President and General Manager, Cameron Western Hemisphere from
July 1999
to July 2002. Vice President Western Hemisphere Operations, Vice
President
Eastern Hemisphere, Vice President Latin American Operations, Director
Human Resources, Director Market Research and Director Materials
of Baker
Hughes Incorporated from 1976 to July 1999.
|
|
Franklin
Myers (54)
|
Senior
Vice President of Finance and Chief Financial Officer since January
2003.
Senior Vice President from July 2001 to January 2003, Senior Vice
President and President of the Cooper Energy Services division
from August
1998 to July 2001 and Senior Vice President, General Counsel and
Secretary
from April 1995 to July 1999.
|
|
John
D. Carne (58)
|
Senior
Vice President since February 2006. Vice President from May 2003
to
February 2006. President, Drilling and Production Systems since
January
2007. President, Valves and Measurement from April 2002 to December
2006.
Director of Operations, Eastern Hemisphere, Cameron Division from
1999 to
March 2002. Plant Manager, Leeds, England, Cameron Division from
1996 to
1999. Director of Operations, U.K. & Norway, Cooper Energy Services
(U.K.) Ltd. from 1988 to 1996.
|
|
William
C. Lemmer (62)
|
Vice
President, General Counsel and Secretary since July 1999. Vice
President,
General Counsel and Secretary of Oryx Energy Company from 1994
to March
1999.
|
|
Joe
Mongrain (48)
|
Vice
President, Human Resources since June 2006. Director Human Resources,
Schlumberger, Data and Consulting from May 2004 to May 2006 and
Director,
Human Resources, Schlumberger, North and South America from January
2001
to April 2004..
|
|
Lorne
E. Phillips (35)
|
Vice
President and Treasurer since December 2006. Treasurer from July
2005 to
December 2006. General Manager, Canadian Operations from March
2003 to
July 2005, Vice President, Marketing and M & A for Cameron’s Valves
& Measurement group from June 2002 to March 2003 and Manager, Business
Development from July 1999 to June 2002.
|
|
Robert
J. Rajeski (61)
|
Vice
President since July 2000. President, Compression Systems since
October
2002. President, Cooper Turbocompressor division from July 1999
to October
2002 and President, Cooper Energy Services division from July 2001
to
October 2002. Vice President and General Manager of Ingersoll-Dresser
Pump
Co., Engineered Pump division from 1994 to July 1999.
|
|
Charles
M. Sledge (41)
|
Vice
President and Corporate Controller since July 2001. Senior Vice
President,
Finance and Treasurer from 1999 to June 2001, and Vice President,
Controller from 1996 to 1999, of Stage Stores, Inc., a chain of
family
apparel stores.
|
|
Dalton
L. Thomas (57)
|
Vice
President, Operations Support, since February 2004. President,
Cameron
division from July 1998 to 2001. Vice President, Eastern Hemisphere
for
Cameron division from 1995 to July 1998.
|
|
James
E. Wright (52)
|
Vice
President and President, Valves and Measurement group since January
2007.
President, Distributed and Process Valves divisions from December
2005 to
December 2006. Vice President and General Manager, Distributed
Products
from August 2002 to December 2005. Vice President and General Manager,
North America Pipeline and Distributor Products from June 2001
to August
2002 and Vice President Marketing and North American Sales for
V&M
from August 1998 to June 2001.
|
Actuator.
A
hydraulic or electric motor used to open or close valves.
Blowout
Preventer. A
hydraulically operated system of safety valves installed at the wellhead
during
drilling and completion operations for the purpose of preventing an increase
of
high-pressure formation fluids — oil, gas or water — in the wellbore from
turning into a “blowout” of the well.
Centrifugal
compressor.
A
compressor with an impeller or rotor, a rotor shaft and a casing which
discharges gases under pressure by centrifugal force.
Choke.
A
type of
valve used to control the rate and pressure of the flow of production from
a
well or through flowlines.
Christmas
tree.
An
assembly of valves, pipes and fittings used to control the flow of oil and
gas
from a well.
Compressor.
A
device
used to create a pressure differential in order to move or compress a vapor
or a
gas.
Controls.
A
device which allows the remote triggering of an actuator to open or close
a
valve.
Elastomer.
A
rubberized pressure control sealing element used in drilling and wellhead
applications.
Integral
reciprocating engine-compressor. A
compressor in which the crankshaft is shared by the engine and compressor,
each
having its own piston rods driven by the shared crankshaft.
Integrally
geared centrifugal compressor. A
compressor in which the motor is geared so that the compressor runs at higher
rpms than the motor itself to gain efficiency.
Reciprocating
compressor. A
compressor in which the compression effect is produced by the reciprocating
motion of pistons and plungers operating in cylinders.
Riser.
Pipe
used
to connect the wellbore of offshore wells to drilling or production equipment
on
the surface, and through which drilling fluids or hydrocarbons
travel.
Valve.
A
device
used to control the rate of flow in a line, to open or shut off a line
completely, or to serve as an automatic or semi-automatic safety
device.
Wellhead.
The
equipment installed at the surface of a wellbore to maintain control of a
well
and including equipment such as the casing head, tubing head and Christmas
tree.
The
information set forth under the caption “Factors That May Affect Financial
Condition and Future Results” on pages 35 to 37 in the 2006 Annual Report to
Stockholders is incorporated herein by reference.
There
were no unresolved comments from the SEC staff at the time of filing of this
Form 10-K.
The
Company currently operates facilities ranging in size from approximately
670
square feet to approximately 1,350,000 square feet. The Company also owns
and
leases warehouses, distribution centers, aftermarket and storage facilities,
sales and administrative offices. The Company leases its corporate headquarters
office space and space for the DPS, V&M and CS division headquarters in
Houston, Texas.
The
Company manufactures, markets and sells its products and provides services
throughout the world, operating facilities in numerous countries. At December
31, 2006, the significant facilities used by Cameron throughout the world
for
manufacturing,
distribution,
aftermarket services, machining, storage, warehousing, sales and administration
contained an aggregate of approximately 11,018,000 square feet of space,
of
which approximately 7,011,000 square feet (64%) was owned and 4,007,000 (36%)
was leased. Of this total, approximately 6,455,000 square feet of space (59%)
is
located in the Western Hemisphere, 3,404,000 square feet of space (31%) is
located in the Eastern Hemisphere, 936,000 square feet of space (8%) is located
in Asia Pacific and the Middle East and 223,000 square feet of space (2%)
is
located in West Africa. The table below shows the number of significant
operating manufacturing, warehouse, distribution and aftermarket facilities
and
sales and administrative offices by business segment and geographic area.
DPS
and V&M share space in certain facilities and, thus, are being reported
together.
|
Western
Hemisphere
|
Eastern
Hemisphere
|
Asia/Pacific
and
Middle
East
|
West
Africa
|
Total
|
|
|
DPS
and V&M
|
133
|
28
|
41
|
13
|
215
|
|
CS
|
19
|
3
|
2
|
—
|
24
|
Taking
into consideration the construction that is currently underway of a new subsea
manufacturing facility in Johor, Malaysia that is scheduled to be in full
operation by the fourth quarter of 2007, Cameron believes its facilities
are
suitable for their present and intended purposes and are adequate for the
Company’s current and anticipated level of operations.
The
Company is subject to a number of contingencies which include environmental
matters, litigation and tax contingencies.
Environmental
Matters
The
Company’s worldwide operations are subject to domestic and international
regulations with regard to air, soil and water quality as well as other
environmental matters. The Company, through its environmental management
system
and active third-party audit program, believes it is in substantial compliance
with these regulations.
The
Company is currently identified as a potentially responsible party (PRP)
with
respect to two sites designated for cleanup under the Comprehensive
Environmental Response Compensation and Liability Act (CERCLA) or similar
state
laws. One of these sites is Osborne, Pennsylvania (a landfill into which
a
predecessor of the CS operation in Grove City, Pennsylvania deposited waste),
where remediation is complete and remaining costs relate to ongoing ground
water
treatment and monitoring. The other is believed to be a de minimis exposure.
The
Company is also engaged in site cleanup under the Voluntary Cleanup Plan
of the
Texas Commission on Environmental Quality at former manufacturing locations
in
Houston and Missouri City, Texas. Additionally, the Company has discontinued
operations at a number of other sites which had been active for many years.
The
Company does not believe, based upon information currently available, that
there
are any material environmental liabilities existing at these locations. At
December 31, 2006, the Company’s consolidated balance sheet included a
noncurrent liability of $7.0 million for environmental matters.
Legal
Matters
At
the
former manufacturing site in Houston, Texas, the Company discovered that
contaminated underground water from this site had migrated under an adjacent
residential area. Pursuant to applicable state regulations, the Company notified
the affected homeowners in 2001. Since that time, the Company has entered
into
agreements with 21 homeowners that obligated the Company to reimburse them
for
any estimated decline in value at time of sale due to potential buyer’s concerns
over contamination following a sale or, in the case of some agreements, to
purchase the property after an agreed marketing period. Four of these agreements
have had no claims made under them yet. In addition, the Company has settled
eight other property claims by homeowners who have sold their properties.
The
Company has had expenses and losses of approximately $8.3 million from 2002
through 2006 related to these various agreements and settlements.
In
addition, the Company is a named defendant in three lawsuits regarding this
contamination and another suit which was settled in January, 2007. The settled
case is Valice v. Cameron Iron Works, Inc. (80th Jud. Dist. Ct., Harris County,
filed June 21, 2002), which was filed and settled as a class action. Pursuant
to
the settlement, the homeowners who remained part of the class will be entitled
to receive a payment of approximately 3% of the 2006 appraised value of their
property or reimbursement of any diminution in value of their property due
to
contamination concerns at the time of any sale. There were 21 homeowners
who
opted out of the class settlement.
The
other
suits pending regarding this matter have been filed by a number of homeowners
who have opted out of the class action settlement. Moldovan v. Cameron Iron
Works, Inc. (165th Jud. Dist. Ct., Harris County, filed October 23, 2006),
was
filed by six homeowners who opted-out of the class settlement. Other suits
filed
include Tuma v. Cameron Iron Works, Inc. (334th
Judicial
District Court of Harris County, Texas, filed on November 27, 2006) and Rudelson
v. Cooper Industries, Inc. (189th
Judicial
District Court of Harris County, Texas, filed on November 29, 2006). The
complaints filed in these actions make the claim that the contaminated
underground water has reduced property values and seeks recovery of actual
and
exemplary damages for the loss of property value.
The
Company is of the opinion that there is no health risk to area residents
and
that the lawsuits essentially reflect concerns over a possible decline in
property value. The Company believes, based on its review of the facts and
law,
that any potential exposure from existing agreements, the class action
settlement or other actions that have been or may be filed, will not have
a
material adverse effect on its financial position or results of operations.
The
Company reserved a total of $17.5 million reserved for these matters as of
December 31, 2006.
The
Company had been named as a defendant in a suit brought by a purchaser of
an
option to purchase a parcel of the same former manufacturing site, Silber/I-10
Venture Ltd., f/k/a Rocksprings Ltd. v. Falcon Interests Realty Corp., Cooper
Industries Inc. and Cooper Cameron Corporation (212th Judicial District Court,
Galveston County, filed August 15, 2002) that alleged fraud and breach of
contract regarding the environmental condition of the parcel under option.
The
parties have settled this matter and the case has been dismissed. Based on
the
Asset Transfer Agreement pursuant to which Cooper Industries, Inc. (Cooper)
spun-off the Company, Cooper has made a claim of approximately $2,500,000
against the Company for reimbursement of its legal fees and settlement costs
with respect to this matter. The Company is of the opinion it is not required
to
make this reimbursement and intends to vigorously defend itself.
The
Company has been named as a defendant in a number of multi-defendant,
multi-plaintiff tort lawsuits since 1995. At December 31, 2006, the Company’s
consolidated balance sheet included a liability of approximately $4.3 million
for such cases, including estimated legal costs.
The
Company believes, based on its review of the facts and law, that the potential
exposure from the remaining suits will not have a material adverse effect
on its
financial condition or liquidity.
Tax
Contingencies
The
Company has legal entities in over 35 countries. As a result, the Company
is
subject to various tax filing requirements in these countries. The Company
prepares its tax filings in a manner which it believes is consistent with
such
filing requirements. However, some of the tax laws and regulations which
the
Company is subject to are subject to interpretation and/or judgment. Although
the Company believes that the tax liability for periods ending on or before
the
balance sheet date have been adequately provided for in the financial
statements, to the extent that a taxing authority believes that the Company
has
not prepared its tax filings in accordance with the authority’s interpretation
of the tax laws/regulations, the Company could be exposed to additional
taxes.
There
were no matters submitted to a vote of security holders during the fourth
quarter of 2006.
The
common stock of Cameron International Corporation, par value $.01 per share
(together with the associated Rights to Purchase Series A Junior Participating
Preferred Stock), is traded on the New York Stock Exchange (“NYSE”) under the
symbol CAM. No dividends were paid during 2006 or 2005.
The
trading activity during 2006 and 2005 was as follows (reflects a 2-for-1
stock
split effective December 15, 2005):
|
Price
Range ($)
|
|||
|
|
High
|
Low
|
Last
|
|
2006
|
|||
|
First
Quarter
|
$50.61
|
$38.08
|
$44.08
|
|
Second
Quarter
|
56.09
|
42.10
|
47.77
|
|
Third
Quarter
|
52.07
|
42.78
|
48.31
|
|
Fourth
Quarter
|
57.81
|
44.60
|
53.05
|
|
Price
Range ($)
|
|||
|
|
High
|
Low
|
Last
|
|
2005
|
|||
|
First
Quarter
|
$29.805
|
$25.52
|
$28.605
|
|
Second
Quarter
|
31.99
|
26.76
|
31.025
|
|
Third
Quarter
|
37.695
|
30.86
|
36.965
|
|
Fourth
Quarter
|
43.10
|
32.21
|
41.40
|
As
of
February 9, 2007, the approximate number of stockholders of record of Cameron
common stock was 1,165.
Information
concerning securities authorized for issuance under equity compensation plans
is
included in Note 8 of the Notes to Consolidated Financial Statements, which
notes are incorporated herein by reference in Part II, Item 8
hereof.
In
February 2006, the Company’s Board of Directors changed the number of shares of
the Company’s common stock authorized for repurchase from the 5,000,000 shares
authorized in August, 2004 to 10,000,000 shares in order to reflect the 2-for-1
stock split effective December 15, 2005. Additionally, on May 22, 2006, the
Company’s Board of Directors approved repurchasing shares of the Company’s
common stock with the proceeds remaining from the Company’s 2.5% Convertible
Debenture offering, after taking into account a planned repayment of $200.0
million principal amount of the Company’s outstanding 2.65% Senior Notes due
2007. This authorization is in addition to the 10,000,000 shares described
above.
Purchases
pursuant to the 10,000,000-share Board authorization may be made by way of
open
market purchases, directly or indirectly, for the Company’s own account or
through commercial banks or financial institutions and by the use of derivatives
such as a sale or put on the Company’s common stock or by forward or
economically equivalent transactions. Shares of common stock purchased and
placed in treasury during the three months ended December 31, 2006 under
the
Board’s two authorization programs described above are as follows:
|
Period
|
Total
number of
shares purchased
|
Average
price paid
per share
|
Total
number of
shares purchased
as part
of all repurchase
programs(a)
|
Maximum
number
of shares
that may yet
be purchased
under
all repurchase
programs
(b)
|
|
10/1/06
- 10/31/06
|
114,500
|
$45.37
|
7,660,115
|
8,520,878
|
|
11/1/06
- 11/30/06
|
—
|
$—
|
7,660,115
|
8,364,409
|
|
12/1/06
- 12/31/06
|
200,000
|
$55.30
|
7,860,115
|
8,208,880
|
|
Total
|
314,500
|
$51.69
|
7,860,115
|
8,208,880
|
____________
(a) All
share
purchases during the three months ended December 31, 2006 were done through
open
market transactions.
(b) Based
on
the closing price of the Company’s common stock of $53.05 per share on December
31, 2006, 1,902,080 shares are yet to be purchased under the May 2006 Board
authorization relating to use of the remaining proceeds from the Company’s 2.5%
Convertible Debenture offering described above.
Performance Graph
The
following performance graph shows the cumulative total stockholder return
on the
Common Stock from December 31, 2000 to December 31, 2006, and compares
it, over
the same period of time, with the cumulative total return of the Standard
&
Poor’s Composite-500 Stock Index and the weighted average (based on stock market
capitalization) cumulative total return of a Peer Group selected by the
Company.
The Peer Group includes the same companies as the previous three years:
Baker
Hughes Incorporated, BJ Services Company, Halliburton Company, Schlumberger
Limited, Smith International, Inc. and Weatherford International, Inc.
In each
case, cumulative total return is calculated assuming a fixed investment
of $100
on December 31, 2001, and the returns on the graph represent the value
that each
of these investments would have had at the end of each year shown.
The
information included under this heading, “Performance Graph,” is “furnished” and
not “filed” and shall not be deemed to be “soliciting material” or subject to
Regulation 14A, shall not be deemed “filed” for purposes of Section 18 of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise
subject to the liabilities in any filing under the Securities Act of 1933,
as
amended, or the Exchange Act.
|
12/31/01
|
12/31/02
|
12/31/03
|
12/31/04
|
12/30/05
|
12/29/06
|
||
|
Cameron
|
100.0
|
123.44
|
115.46
|
133.33
|
205.15
|
262.88
|
|
|
S&P
500
|
100.0
|
78.03
|
100.16
|
110.92
|
116.28
|
134.43
|
|
|
Peer
Group
|
100.0
|
94.12
|
112.49
|
148.97
|
221.25
|
259.36
|
The
information set forth under the caption “Selected Consolidated Historical
Financial Data of Cameron International Corporation” on page 70 in the 2006
Annual Report to Stockholders is incorporated herein by reference.
The
information set forth under the caption “Management’s Discussion and Analysis of
Results of Operations and Financial Condition of Cameron International
Corporation” on pages 25-39 in the 2006 Annual Report to Stockholders is
incorporated herein by reference.
The
information for this item is set forth in the section entitled “Market Risk
Information” on pages 38-39 in the 2006 Annual Report to Stockholders and is
incorporated herein by reference.
The
following consolidated financial statements of the Company and the independent
registered public accounting firm’s reports set forth on pages 40-69 in the 2006
Annual Report to Stockholders are incorporated herein by reference:
Management’s
Report on Internal Control Over Financial Reporting.
Report
of
Independent Registered Public Accounting Firm on Internal Control Over Financial
Reporting.
Report
of
Independent Registered Public Accounting Firm.
Consolidated
Results of Operations for each of the three years in the period ended December
31, 2006.
Consolidated
Balance Sheets as of December 31, 2006 and 2005.
Consolidated
Cash Flows for each of the three years in the period ended December 31,
2006.
Consolidated
Changes in Stockholders’ Equity for each of the three years in the period ended
December 31, 2006.
Notes
to
Consolidated Financial Statements.
None.
(a)
The
Company carried out an evaluation, under the supervision and with the
participation of the Company’s Disclosure Committee and the Company’s
management, including the Chief Executive Officer and the Chief Financial
Officer, of the effectiveness of the design and operation of the Company’s
disclosure controls and procedures, as defined in Rules 13a - 15(e) and 15d
-
15(e) of the Securities Exchange Act of 1934, as of December 31, 2006. In
conducting management’s evaluation as described above, the Brazilian operations
of the Flow Control segment of Dresser, Inc., acquired during 2006, were
excluded. These operations constituted less than 5% of the Company’s
consolidated revenues, income before income taxes and total assets as of
and for
the year ended December 31, 2006. Based upon that evaluation, the Chief
Executive Officer and the Chief Financial Officer concluded that the Company’s
disclosure controls and procedures were effective as of December 31, 2006
to
ensure that information required to be disclosed by the Company that it files
or
submits under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in the SEC’s rules and forms and that
information required to be disclosed in the reports that the Company files
or
submits under the Exchange Act is accumulated and communicated to the Company’s
management, including its Chief Executive Officer and Chief Financial Officer,
as appropriate, to allow timely decisions regarding required
disclosure.
(b)
Management’s Report on Internal Control over Financial Reporting - The report of
management of the Company regarding internal control over financial reporting
is
set forth in Part II, Item 8 of this Annual Report on Form 10-K under the
caption “Management’s Report on Internal Control over Financial Reporting” and
incorporated herein by reference.
(c)
Attestation Report of Independent Registered Public Accounting Firm - The
attestation report of the Company’s independent registered public accounting
firm regarding internal control over financial reporting is set forth in
Part
II, Item 8 of this Annual Report on Form 10-K under the caption “Report of
Independent Registered Public Accounting Firm on Internal Control Over Financial
Reporting” and incorporated herein by reference.
(d)
Changes in Internal Control over Financial Reporting - During the fourth
quarter
of 2006, the Company converted certain of the businesses acquired from Dresser
in late 2005, located in Italy, Brazil and the United Kingdom, to its SAP
enterprise-wide software systems that are used to manage the Company’s
procurement, manufacturing, accounting and reporting needs. Other than as
described above, no other changes have been made in the Company’s internal
control over financial reporting during the fourth quarter of 2006 that have
materially affected, or are reasonably likely to materially affect, the
Company’s internal control over financial reporting.
None
Information
regarding Section 16(a) compliance, the Audit Committee, the Company’s Code of
Business Ethics and Ethics for Directors, shareholder nominating procedures
and
background of the directors appearing under the captions “Section 16(a)
Beneficial Ownership Reporting Compliance”, “Corporate Governance and Board of
Directors Matters”, and “Security Ownership of Management” in the Company’s
Proxy Statement for the 2007 Annual Meeting of Stockholders is incorporated
herein by reference.
The
Registrant has adopted a code of ethics that applies to all employees, including
its principal executive officer, principal financial officer, principal
accounting officer and its Board of Directors. A copy of the code of ethics
is
available on the Registrant’s Internet website at www.c-a-m.com and is available
in print to any shareholder free of charge upon request. The Registrant intends
to satisfy the disclosure requirements under Item 10 of Form 8-K regarding
an
amendment to, or a waiver from, a provision of its code of ethics that applies
to its principal executive officer, principal financial officer, principal
accounting officer or persons performing similar functions, by posting such
information on its website at the address set forth above.
The
information under the heading “Executive Officers of the Registrant” in Part I,
Item 1 of this Form 10-K is incorporated by reference in this
section.
The
information concerning "Executive Compensation" required by Item 11 shall
be
included in the Proxy Statement to be filed relating to our 2007 Annual Meeting
of Stockholders and is incorporated herein by reference.
The
information concerning "Security Ownership of Certain Beneficial Owners"
and
"Security Ownership of Management" required by Item 12 shall be included
in our
Proxy Statement to be filed relating to the 2007 Annual Meeting of Stockholders
and is incorporated herein by reference.
The
information concerning the Company's "Policy on Related Person Transactions"
and
"Director Independence" required by Item 13 shall be included in our Proxy
Statement to be filed relating to the 2007 Annual Meeting of Stockholders
and is
incorporated herein by reference.
The
information concerning "Principal Accounting Firm Fees" required by Item 14
shall be included in the Proxy Statement to be filed relating to our 2007
Annual
Meeting of Stockholders and is incorporated herein by reference.
(a) The
following documents are filed as part of this Report:
(1) Financial
Statements:
All
financial statements of the Registrant as set forth under Part II, Item 8
of
this Annual Report on Form 10-K.
(2) Financial
Statement Schedules:
REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The
Board
of Directors and Stockholders of
Cameron
International Corporation
We
have
audited the consolidated financial statements of Cameron International
Corporation (the Company) as of December 31, 2006 and 2005, and for each
of the
three years in the period ended December 31, 2006, and have issued our report
thereon dated February 26, 2007 (incorporated by reference in this Form 10-K).
Our audits also included the financial statement schedule included in Item
15(a)(2) of this Form 10-K. This schedule is the responsibility of the Company’s
management. Our responsibility is to express an opinion based on our
audits.
In
our
opinion, the financial statement schedule referred to above, when considered
in
relation to the basic consolidated financial statements taken as a whole,
presents fairly, in all material respects, the information set forth
therein.
| /s/ Ernst & Young LLP | ||
Houston,
Texas
February
26, 2007
Schedule
II - Valuation and Qualifying Accounts
(dollars
in thousands)
|
Additions
|
|||||||||||||||||
|
|
|
Balance
at
beginning
of
period
|
|
Charged
to
costs
and expenses
|
|
Charged
to other
accounts
|
|
Deductions
(b)
|
|
Translation
|
|
Balance
at end
of
period
|
|||||
|
YEAR
ENDED DECEMBER 31, 2006:
|
|
||||||||||||||||
|
Allowance
for doubtful accounts
|
$
|
9,775
|
$
|
2,082
|
$
|
(149
|
) |
$
|
(3,495)
|
$
|
(910
|
) |
$
|
7,303
|
|||
|
Allowance
for obsolete and excess inventory
|
$
|
48,305
|
$
|
10,760
|
$
|
858
|
$
|
(17,879)
|
$
|
2,179
|
$
|
44,223
|
|||||
|
YEAR
ENDED DECEMBER 31, 2005:
|
|||||||||||||||||
|
Allowance
for doubtful accounts
|
$
|
4,513
|
$
|
1,583
|
$
|
4,556
|
$
|
(874)
|
$
|
(3
|
) |
$
|
9,775
|
||||
|
Allowance
for obsolete and excess inventory
|
$
|
47,778
|
$
|
21,971
|
$
|
7,755
|
(a) |
$
|
(28,084)
|
(a) |
$
|
(1,115
|
) |
$
|
48,305
|
||
|
YEAR
ENDED DECEMBER 31, 2004:
|
|||||||||||||||||
|
Allowance
for doubtful accounts
|
$
|
1,823
|
$
|
3,313
|
$
|
145
|
$
|
(781)
|
$
|
13
|
$
|
4,513
|
|||||
|
Allowance
for obsolete and excess inventory
|
$
|
37,317
|
$
|
18,659
|
$
|
2,500
|
$
|
(10,019)
|
$
|
(679
|
) |
$
|
47,778
|
||||
____________
(a)
Certain amounts in 2005 have been reclassified to conform to the 2006
presentation.
(b)
Write-offs of uncollectible receivables, deductions for collections of
previously reserved receivables and write-offs of obsolete
inventory.
(3) Exhibits:
|
3.1
|
Amended
and Restated Certificate of Incorporation of Cameron International
Corporation, dated June 30, 1995, filed as Exhibit 4.2 to the Registration
Statement on Form S-8 filed on July 25, 2005 (Commission File No.
33-94948), and incorporated herein by reference.
|
|
3.2
|
Certificate
of Amendment to the Restated Certificate of Incorporation of Cameron
International Corporation, filed as Exhibit 4.3 to the Registration
Statement on Form S-8 filed on May 19, 1998 (Commission File No.
333-57995), and incorporated herein by reference.
|
| 3.3 | Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Cameron International Corporation, dated May 5, 2006 (incorporated by reference, filed as Exhibit 3.1 to the Form 8-K filed on May 9, 2006). |
|
3.4
|
Second
Amended and Restated Bylaws of the Company, filed as Exhibit 3.3
to the
Annual Report on Form 10-K for 2002 of the Company, and incorporated
herein by reference.
|
|
4.1
|
Form
of Rights Agreement, dated as of May 1, 1995, between the Company
and
First Chicago Trust Company of New York, as Rights Agent, filed
as Exhibit
4.1 to the Registration Statement on Form S-8 of the Company (Commission
File No. 33-94948), and incorporated herein by
reference.
|
|
4.2
|
First
Amendment to Rights Agreement between the Company and First Chicago
Trust
Company of New York, as Rights Agent, dated November 1, 1997, filed
as
Exhibit 4.2 to the Annual Report on Form 10-K for 1997 of the Company,
and
incorporated herein by reference.
|
|
4.3
|
Registration
Statement on Form S-3 filed with the Securities and Exchange Commission
on
May 4, 1998 (Registration Statement No. 333-51705), and incorporated
herein by reference.
|
|
10.1
|
The
Company's Broad Based 2000 Incentive Plan, filed as Exhibit 4.6
to the
Registration Statement on Form S-8 of the Company (Commission File
No.
333-46638), and incorporated herein by reference.
|
|
10.2
|
First
Amendment to the Company's Broad Based 2000 Incentive Plan, filed as
Exhibit 4.7 to the Registration Statement on Form S-8 filed with
the SEC
on May 29, 2001 (File No. 333-61820), and incorporated herein by
reference.
|
|
10.3
|
Second
Amendment to the Company's Broad Based 2000 Incentive Plan, filed
as
Exhibit 4.8 to the Registration Statement on Form S-8 filed with
the SEC
on February 4, 2002 (File No. 333-82082), and incorporated herein
by
reference.
|
|
10.4
|
Third
Amendment to the Company's Broad Based 2000 Incentive Plan, filed
as
Exhibit 4.9 to the Registration Statement on Form S-8 filed with
the SEC
on February 4, 2002 (File No. 333-82082), and incorporated herein
by
reference.
|
|
10.5
|
Fourth
Amendment to the Company's Broad Based 2000 Incentive Plan, filed
as
Exhibit 10.6 to the Annual Report on Form 10-K for 2002 of the
Company,
and incorporated herein by reference.
|
|
10.6
|
Cameron
International Corporation Retirement Savings Plan, as Amended and
Restated, effective May 1, 2003, filed as Exhibit 10.8 to the Annual
Report on Form 10-K for 2004 of the Company, and incorporated herein
by
reference.
|
|
10.7
|
First
through Third Amendments to the Cameron International Corporation
Retirement Savings Plan, filed as Exhibit 10.9 to the Annual Report
on
Form 10-K for 2004 of the Company, and incorporated herein by
reference.
|
|
10.8
|
Fourth
and Fifth Amendments to the Cameron International Corporation Retirement
Savings Plan, filed as Exhibit 10.8 to the Annual Report on Form
10-K for
2005 of the Company, and incorporated herein by
reference.
|
|
10.9
|
Merger
of the Petreco International, Inc. 401(k) Profit Sharing Plan with
and
into the Cameron International Corporation Retirement Savings Plan,
filed
as Exhibit 10.10 to the Annual Report on Form 10-K for 2004 of
the
Company, and incorporated herein by reference.
|
|
10.10
|
Merger
of the the Company's Savings-Investment Plan for Hourly Employees
with and
into the Cameron International Corporation Retirement Savings Plan,
filed
as Exhibit 10.11 to the Annual Report on Form 10-K for 2004 of
the
Company, and incorporated herein by reference.
|
|
10.11
|
Amendment
to the NuFlo Technologies, Inc. 401(K) Plan and Merger of the NuFlo
Technologies, Inc. 401(K) Plan with and into the Cameron International
Corporation Retirement Savings Plan, filed as Exhibit 10.11 to
the Annual
Report on Form 10-K for 2005 of the Company, and incorporated herein
by
reference.
|
|
10.12
|
The
Company's 2005 Equity Incentive Plan, incorporated by reference
to the
Company's Proxy Statement for the Annual Meeting of Stockholders
held on
May 5, 2005.
|
|
10.13
|
First
Amendment to the Company's 2005 Equity Incentive Plan, filed as
Exhibit
10.13 to the Annual Report on Form 10-K for 2005 of the Company,
and
incorporated herein by reference.
|
|
10.14
|
The
Company's Supplemental Excess Defined Benefit Plan, filed as Exhibit
10.4
to the Registration Statement on Form S-4 of the Company (Commission
File
No. 33-90288), and incorporated herein by reference.
|
|
10.15
|
First
Amendment to Cameron International Corporation Supplemental Excess
Defined
Benefit Plan, effective as of January 1, 1996, filed as Exhibit
10.7 to
the Annual Report on Form 10-K for 1996 of the Company, and incorporated
herein by reference.
|
|
10.16
|
The
Company's 2003 Supplemental Excess Defined Contribution Plan, filed
as
Exhibit 4.13 to the Registration Statement on Form S-8 filed with
the SEC
on June 18, 2003, of the Company (Commission File No. 333-106225),
and
incorporated herein by reference.
|
|
10.17
|
First
Amendment to Cameron International Corporation 2003 Supplemental
Excess
Defined Contribution Plan filed as Exhibit 4.14 to the Registration
Statement on Form S-8, filed with the SEC on June 18, 2003, of
the Company
(Commission File No. 333-106225), and incorporated herein by
reference.
|
|
10.18
|
Employment
Agreement by and between Sheldon R. Erikson and the Company, effective
as
of August 13, 1999, filed as Exhibit 10.16 to the Annual Report
on Form
10-K for 1999 of the Company, and incorporated herein by
reference.
|
|
10.19
|
Amendment
to the Employment Agreement between the Company and Sheldon R.
Erikson,
dated August 24, 2004, filed as Exhibit 10.48 to the Annual Report
on Form
10-K for 2004 of the Company, and incorporated herein by
reference.
|
|
|
|
|
10.20
|
Employment
Agreement by and between Franklin Myers and the Company, effective
as of
September 1, 1999, filed as Exhibit 10.18 to the Annual Report
on Form
10-K for 1999 of the Company, and incorporated herein by
reference.
|
|
10.21
|
Amendment
to the Employment Agreement between the Company and Franklin Myers,
dated
August 16, 2004, filed as Exhibit 10.47 to the Annual Report on
Form 10-K
for 2004 of the Company, and incorporated herein by
reference.
|
|
10.22
|
Form
of Change in Control Agreement, effective November 11, 1999, by
and
between the Company and Scott Amann, William Lemmer and Robert
Rajeski,
filed as Exhibit 10.19 to the Annual Report on Form 10-K for 1999
of the
Company, and incorporated herein by reference.
|
|
10.23
|
Amendment
to the Change in Control Agreements, effective May 31, 2005, by
and
between the Company and Scott Amann, William Lemmer and Robert
Rajeski,
filed as Exhibit 10.23 to the Annual Report on Form 10-K for 2005
of the
Company, and incorporated herein by reference.
|
|
10.24
|
Form
of Change in Control Agreement, effective October 10, 2002, by
and between
the Company and Charles M. Sledge, filed as Exhibit 10.23 to the
Annual
Report on Form 10-K for 2002 of the Company, and incorporated herein
by
reference.
|
|
10.25
|
Amendment
to the Employment Agreement between the Company and Charles M.
Sledge,
dated December 21, 2004, filed as Exhibit 10.46 to the Annual Report
on
Form 10-K for 2004 of the Company, and incorporated herein by
reference.
|
|
10.26
|
Form
of Change in Control Agreement, effective May 8, 2003, by and between
the
Company and John Carne and Jack Moore, filed as Exhibit 10.27 to
the
Annual Report on Form 10-K for 2003 of the Company, and incorporated
herein by reference.
|
|
10.27
|
Amended
and Restated Management Incentive Compensation Plan of the Company,
incorporated herein by reference to the Company 2005 Proxy Statement
for
the Annual Meeting of Stockholders held on May 5, 2005.
|
|
10.28
|
Change
in Control Policy of the Company, approved February 19, 1996, filed
as
Exhibit 10.18 to the Annual Report on Form 10-K for 1996 of the
Company,
and incorporated herein by reference.
|
|
10.29
|
Form
of Executive Severance Program of the Company, effective July 1,
2000, and
reissued January 1, 2004, filed as Exhibit 10.29 to the Annual
Report on
Form 10-K for 2005 of the Company, and incorporated herein by
reference.
|
|
10.30
|
Credit
Agreement, dated as of October 12, 2005, among the Company and
certain of
its subsidiaries and the banks named therein and JPMorgan Chase
Bank,
N.A., as agent, filed as Exhibit 10.1 to the Current Report on
Form 8-K
dated October 12, 2005, of the Company, and incorporated herein
by
reference.
|
|
10.31
|
Individual
Account Retirement Plan for Bargaining Unit Employees at the Company's
Buffalo, New York Plant, filed as Exhibit 4.6 to the Registration
Statement on Form S-8 (Registration No. 333-57991), incorporated
herein by
reference.
|
|
10.32
|
First
through Eighth Amendments to the Individual Account Retirement
Plan for
Bargaining Unit Employees at the Company's Buffalo, New York Plant,
filed
as Exhibit 10.36 to the Annual Report on Form 10-K for 2004 of
the
Company, and incorporated herein by reference.
|
|
10.33
|
Ninth
Amendment to the Individual Account Retirement Plan for Bargaining
Unit
Employees at the Cameron International Corporation Buffalo, New
York
Plant, filed as Exhibit 10.33 to the Annual Report on Form 10-K
for 2005
of the Company, and incorporated herein by
reference.
|
|
10.34
|
Form
of Indemnification Agreement, effective February 20, 2003, by and
between
the Company and Nathan M. Avery, C. Baker Cunningham, Sheldon R.
Erikson,
Lamar Norsworthy, Michael E. Patrick, David Ross and Bruce W. Wilkinson,
filed as Exhibit 10.32 to the Annual Report on Form 10-K/A for
2002 of the
Company, and incorporated herein by reference.
|
|
10.35
|
Form
of Indemnification Agreement, effective February 20, 2003, by and
between
the Company and Mr. Jeff Altamari, Mr. Steve P. Beatty, Mr. John
Carne,
Mr. Hal Goldie, Mr. William C. Lemmer, Mr. Jack B. Moore, Mr. Franklin
Myers, Mr. Robert Rajeski, Mr. Charles M. Sledge, and Mr. Rick
Steans,
filed as Exhibit 10.36 to the Annual Report on Form 10-K for 2003
of the
Company, and incorporated herein by reference.
|
|
10.36
|
Form
of Stock Option Agreement for grants dated November 22, 2004, under
the
Company's Long-Term Incentive Plan, filed as an exhibit to a Form
8-K
filed on January 18, 2005, and incorporated herein by
reference.
|
|
10.37
|
Change
of Control Agreement, dated February 19, 2004, by and between Dalton
Thomas and the Company, filed as Exhibit 10.49 to the Annual Report
on
Form 10-K for 2004 of the Company, and incorporated herein by
reference.
|
|
10.38
|
Form
of Restricted Stock Agreement for Restricted Stock Units granted
on
January 1, 2005, filed as Exhibit 10.50 to the Annual Report on
Form 10-K
for 2004 of the Company, and incorporated herein by
reference.
|
|
10.39
|
Form
of Restricted Stock Agreement for Restricted Stock Units granted
on
January 1, 2006, filed as Exhibit 10.39 to the Annual Report on
Form 10-K
for 2005 of the Company, and incorporated herein by
reference.
|
|
10.40
|
Form
of Stock Option Agreement for grants dated November 22, 2004, under
the
Company's Long-Term Incentive Plan, filed as an exhibit to a Form
8-K
filed on January 18, 2005, and incorporated herein by
reference.
|
|
10.41
|
The
Company's Deferred Compensation Plan for Non-Employee Directors,
filed as
Exhibit 10.41 to the Annual Report on Form 10-K for 2005 of the
Company,
and incorporated herein by reference.
|
|
10.42
|
The
Company's Long-Term Incentive Plan, as Amended and Restated as
of November
2002, incorporated by reference to the Company's Proxy Statement
for the
Annual Meeting of Stockholders held on May 8, 2003.
|
|
10.43
|
Sixth
Amendment to the Company's Long-Term Incentive Plan, as Amended
and
Restated as of November 2002, incorporated by reference to the
Company's
Proxy Statement for the annual meeting of Stockholders held on
May 8,
2003.
|
|
10.44
|
Seventh
Amendment to the Company's Long-Term Incentive Plan, filed as Exhibit
10.44 to the Annual Report on Form 10-K for 2004 of the Company,
and
incorporated herein by reference.
|
|
10.45
|
The
Company's Second Amended and Restated 1995 Stock Option Plan for
Non-Employee Directors (Registration Statement on Form S-8 No.
333-79787),
incorporated herein by reference.
|
|
10.46
|
First
Amendment to the Company's Second Amended and Restated 1995 Stock
Option
Plan for Non-Employee Directors, filed as Exhibit 10.43 to the
Annual
Report on Form 10-K for 2004 of the Company, and incorporated herein
by
reference.
|
|
10.47
|
Form
of Stock Option Agreement for stock options granted on November
10, 2005,
filed as Exhibit 10.47 to the Annual Report on Form 10-K for 2005
of the
Company, and incorporated herein by reference.
|
| 10.48 | Third Amendment to the Company's 2005 Equity Incentive Plan, filed as Exhibit "A" of the Cameron International Corporation 2006 Proxy Statement. |
| 10.49* | Fourth Amendment to the Company's 2005 Equity Incentive Plan. |
| 10.50* |
Change
of Control Agreement, dated August 10, 2006, by and between Joseph
H.
Mongrain and Cameron International Corporation.
|
|
13.1*
|
Portions
of the 2006 Annual Report to Stockholders are included as an exhibit
to
this report.
|
|
14.1
|
Code
of Business Conduct and Ethics for Directors incorporated by reference
to
the Company's Proxy Statement for the annual meeting of Stockholders
held
on May 8, 2003.
|
|
14.2
|
Code
of Ethics for Management Personnel, filed as Exhibit 14.2 to the
Annual
Report on Form 10-K for 2004 of the Company, and incorporated herein
by
reference.
|
|
14.3
|
Standards
of Conduct, filed as Exhibit 14.3 to the Annual Report on Form
10-K for
2004 of the Company, and incorporated herein by
reference.
|
|
21.1*
|
Subsidiaries
of registrant.
|
|
23.1*
|
Consent
of Independent Registered Public Accounting Firm.
|
|
31.1*
|
Certification.
|
|
31.2*
|
Certification.
|
|
32.1*
|
Certification
of Chief Executive Officer and Chief Financial Officer Pursuant
to Section
906 of the Sarbanes-Oxley Act of
2002.
|
____________
* Filed
herewith
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.
| CAMERON INTERNATIONAL CORPORATION | ||
| Registrant | ||
| By: | /s/ Charles M. Sledge | |
| (Charles M. Sledge) | ||
| Vice President and Corporate Controller | ||
| (Principal Accounting Officer) | ||
| Date: February 27, 2007 | ||
Pursuant
to the requirements of the Securities Exchange Act of 1934,
this report
has been signed on this 27th
day of February, 2007, by the following persons on
behalf of the Registrant and in the capacities indicated.
|
Signature
|
Title
|
|
/S/
Nathan M. Avery
|
|
|
(Nathan
M. Avery)
|
Director
|
|
/s/
C. Baker Cunningham
|
|
|
(C.
Baker Cunningham)
|
Director
|
|
/s/ Sheldon
R. Erikson
|
Chairman
and Chief Executive Officer
|
|
(Sheldon
R. Erikson)
|
(principal
executive officer)
|
|
/s/
Peter J. Fluor
|
|
|
(Peter
J. Fluor)
|
Director
|
|
(Lamar
Norsworthy)
|
Director
|
|
/s/
Michael E. Patrick
|
|
|
(Michael
E. Patrick)
|
Director
|
|
/s/
David Ross III
|
|
|
(David
Ross III)
|
Director
|
|
/s/
Bruce W. Wilkinson
|
|
|
(Bruce
W. Wilkinson)
|
Director
|
|
/s/
Franklin Myers
|
Senior
Vice President and Chief Financial Officer
|
|
(Franklin
Myers)
|
(principal
financial officer)
|
EXHIBIT
INDEX
|
Exhibit
Number
|
Description
|
Sequential
Page
Number
|
|
3.1
|
Amended
and Restated Certificate of Incorporation of Cameron International
Corporation, dated June 30, 1995, filed as Exhibit 4.2 to the
Registration
Statement on Form S-8 filed on July 25, 2005 (Commission File
No.
33-94948), and incorporated herein by reference.
|
|
|
3.2
|
Certificate
of Amendment to the Restated Certificate of Incorporation of
Cameron
International Corporation, filed as Exhibit 4.3 to the Registration
Statement on Form S-8 filed on May 19, 1998 (Commission File
No.
333-57995), and incorporated herein by reference.
|
|
|
3.3
|
Second
Amended and Restated Bylaws of the Company, filed as Exhibit 3.3
to the
Annual Report on Form 10-K for 2002 of the Company, and incorporated
herein by reference.
|
|
| 3.4 | Second Amended and Restated Bylaws of the Company, filed as Exhibit 3.3 to the Annual Report on Form 10-K for 2002 of the Company, and incorporated herein by reference. | |
|
4.1
|
Form
of Rights Agreement, dated as of May 1, 1995, between the Company
and
First Chicago Trust Company of New York, as Rights Agent, filed
as Exhibit
4.1 to the Registration Statement on Form S-8 of the Company (Commission
File No. 33-94948), and incorporated herein by reference.
|
|
|
4.2
|
First
Amendment to Rights Agreement between the Company and First Chicago
Trust
Company of New York, as Rights Agent, dated November 1, 1997, filed
as
Exhibit 4.2 to the Annual Report on Form 10-K for 1997 of the Company,
and
incorporated herein by reference.
|
|
|
4.3
|
Registration
Statement on Form S-3 filed with the Securities and Exchange Commission
on
May 4, 1998 (Registration Statement No. 333-51705), and incorporated
herein by reference.
|
|
|
10.1
|
The
Company's Broad Based 2000 Incentive Plan, filed as Exhibit 4.6
to the
Registration Statement on Form S-8 of the Company (Commission File
No.
333-46638), and incorporated herein by reference.
|
|
|
10.2
|
First
Amendment to the Company's Broad Based 2000 Incentive Plan, filed
as
Exhibit 4.7 to the Registration Statement on Form S-8 filed with
the SEC
on May 29, 2001 (File No. 333-61820), and incorporated herein by
reference.
|
|
|
10.3
|
Second
Amendment to the Company's Broad Based 2000 Incentive Plan, filed
as
Exhibit 4.8 to the Registration Statement on Form S-8 filed with
the SEC
on February 4, 2002 (File No. 333-82082), and incorporated herein
by
reference.
|
|
|
10.4
|
Third
Amendment to the Company's Broad Based 2000 Incentive Plan, filed
as
Exhibit 4.9 to the Registration Statement on Form S-8 filed with
the SEC
on February 4, 2002 (File No. 333-82082), and incorporated herein
by
reference.
|
|
|
10.5
|
Fourth
Amendment to the Company's Broad Based 2000 Incentive Plan, filed
as
Exhibit 10.6 to the Annual Report on Form 10-K for 2002 of the
Company,
and incorporated herein by reference.
|
|
|
10.6
|
Cameron
International Corporation Retirement Savings Plan, as Amended and
Restated, effective May 1, 2003, filed as Exhibit 10.8 to the Annual
Report on Form 10-K for 2004 of the Company, and incorporated herein
by
reference.
|
|
|
10.7
|
First
through Third Amendments to the Cameron International Corporation
Retirement Savings Plan, filed as Exhibit 10.9 to the Annual Report
on
Form 10-K for 2004 of the Company, and incorporated herein by
reference.
|
|
|
10.8
|
Fourth
and Fifth Amendments to the Cameron International Corporation Retirement
Savings Plan, filed as Exhibit 10.8 to the Annual Report on Form
10-K for
2005 of the Company, and incorporated herein by reference.
|
|
|
Exhibit
Number
|
Description
|
Sequential
Page
Number
|
|
10.9
|
Merger
of the Petreco International, Inc. 401(k) Profit Sharing Plan with
and
into the Cameron International Corporation Retirement Savings Plan,
filed
as Exhibit 10.10 to the Annual Report on Form 10-K for 2004 of
the
Company, and incorporated herein by reference.
|
|
|
10.10
|
Merger
of the Company's Savings-Investment Plan for Hourly Employees with
and
into the Cameron International Corporation Retirement Savings Plan,
filed
as Exhibit 10.11 to the Annual Report on Form 10-K for 2004 of
the
Company, and incorporated herein by reference.
|
|
|
10.11
|
Amendment
to the NuFlo Technologies, Inc. 401(K) Plan and Merger of the NuFlo
Technologies, Inc. 401(K) Plan with and into the Cameron International
Corporation Retirement Savings Plan, filed as Exhibit 10.11 to
the Annual
Report on Form 10-K for 2005 of the Company, and incorporated herein
by
reference.
|
|
|
10.12
|
The
Company's 2005 Equity Incentive Plan, incorporated by reference
to the
Company's Proxy Statement for the Annual Meeting of Stockholders
held on
May 5, 2005.
|
|
|
10.13
|
First
Amendment to the Company's 2005 Equity Incentive Plan, filed as
Exhibit
10.13 to the Annual Report on Form 10-K for 2005 of the Company,
and
incorporated herein by reference
|
|
|
10.14
|
The
Company's Supplemental Excess Defined Benefit Plan, filed as Exhibit
10.4
to the Registration Statement on Form S-4 of the Company (Commission
File
No. 33-90288), and incorporated herein by reference.
|
|
|
10.15
|
First
Amendment to Cameron International Corporation Supplemental Excess
Defined
Benefit Plan, effective as of January 1, 1996, filed as Exhibit
10.7 to
the Annual Report on Form 10-K for 1996 of the Company, and incorporated
herein by reference.
|
|
|
10.16
|
The
Company's 2003 Supplemental Excess Defined Contribution Plan, filed
as
Exhibit 4.13 to the Registration Statement on Form S-8 filed with
the SEC
on June 18, 2003, of the Company (Commission File No. 333-106225),
and
incorporated herein by reference.
|
|
|
10.17
|
First
Amendment to Cameron International Corporation 2003 Supplemental
Excess
Defined Contribution Plan filed as Exhibit 4.14 to the Registration
Statement on Form S-8, filed with the SEC on June 18, 2003, of
the Company
(Commission File No. 333-106225), and incorporated herein by
reference.
|
|
|
10.18
|
Employment
Agreement by and between Sheldon R. Erikson and the Company, effective
as
of August 13, 1999, filed as Exhibit 10.16 to the Annual Report
on Form
10-K for 1999 of the Company, and incorporated herein by
reference.
|
|
|
10.19
|
Amendment
to the Employment Agreement between the Company and Sheldon R.
Erikson,
dated August 24, 2004, filed as Exhibit 10.48 to the Annual Report
on Form
10-K for 2004 of the Company, and incorporated herein by
reference.
|
|
|
10.20
|
Employment
Agreement by and between Franklin Myers and the Company, effective
as of
September 1, 1999, filed as Exhibit 10.18 to the Annual Report
on Form
10-K for 1999 of the Company, and incorporated herein by
reference.
|
|
|
10.21
|
Amendment
to the Employment Agreement between the Company and Franklin Myers,
dated
August 16, 2004, filed as Exhibit 10.47 to the Annual Report on
Form 10-K
for 2004 of the Company, and incorporated herein by
reference.
|
|
|
10.22
|
Form
of Change in Control Agreement, effective November 11, 1999, by
and
between the Company and Scott Amann, William Lemmer and Robert
Rajeski,
filed as Exhibit 10.19 to the Annual Report on Form 10-K for 1999
of the
Company, and incorporated herein by reference.
|
|
|
Exhibit
Number
|
Description
|
Sequential
Page
Number
|
|
10.23
|
Amendment
to the Change in Control Agreements, effective May 31, 2005, by
and
between the Company and Scott Amann, William Lemmer and Robert
Rajeski,
filed as Exhibit 10.23 to the Annual Report on Form 10-K for 2005
of the
Company, and incorporated herein by reference.
|
|
|
10.24
|
Form
of Change in Control Agreement, effective October 10, 2002, by
and between
the Company and Charles M. Sledge, filed as Exhibit 10.23 to the
Annual
Report on Form 10-K for 2002 of the Company, and incorporated herein
by
reference.
|
|
|
10.25
|
Amendment
to the Employment Agreement between the Company and Charles M.
Sledge,
dated December 21, 2004, filed as Exhibit 10.46 to the Annual Report
on
Form 10-K for 2004 of the Company, and incorporated herein by
reference.
|
|
|
10.26
|
Form
of Change in Control Agreement, effective May 8, 2003, by and between
the
Company and John Carne and Jack Moore, filed as Exhibit 10.27 to
the
Annual Report on Form 10-K for 2003 of the Company, and incorporated
herein by reference.
|
|
|
10.27
|
Amended
and Restated Management Incentive Compensation Plan of the Company,
incorporated herein by reference to the Company's 2005 Proxy Statement
for
the Annual Meeting of Stockholders held on May 5, 2005.
|
|
|
10.28
|
Change
in Control Policy of the Company, approved February 19, 1996, filed
as
Exhibit 10.18 to the Annual Report on Form 10-K for 1996 of the
Company,
and incorporated herein by reference.
|
|
|
10.29
|
Form
of Executive Severance Program of the Company, effective July 1,
2000, and
reissued January 1, 2004, filed as Exhibit 10.29 to the Annual
Report on
Form 10-K for 2005 of the Company, and incorporated herein by
reference.
|
|
|
10.30
|
Credit
Agreement, dated as of October 12, 2005, among the Company and
certain of
its subsidiaries and the banks named therein and JPMorgan Chase
Bank,
N.A., as agent, filed as Exhibit 10.1 to the Current Report on
Form 8-K
dated October 12, 2005, of the Company, and incorporated herein
by
reference.
|
|
|
10.31
|
Individual
Account Retirement Plan for Bargaining Unit Employees at the Company's
Buffalo, New York Plant, filed as Exhibit 4.6 to the Registration
Statement on Form S-8 (Registration No. 333-57991), incorporated
herein by
reference.
|
|
|
10.32
|
First
through Eighth Amendments to the Individual Account Retirement
Plan for
Bargaining Unit Employees at the Cameron International Corporation
Buffalo, New York Plant, filed as Exhibit 10.36 to the Annual Report
on
Form 10-K for 2004 of the Company, and incorporated herein by
reference.
|
|
|
10.33
|
Ninth
Amendment to the Individual Account Retirement Plan for Bargaining
Unit
Employees at the Company's Buffalo, New York Plant, filed as Exhibit
10.33
to the Annual Report on Form 10-K for 2005 of the Company, and
incorporated herein by reference.
|
|
|
10.34
|
Form
of Indemnification Agreement, effective February 20, 2003, by and
between
the Company and Nathan M. Avery, C. Baker Cunningham, Sheldon R.
Erikson,
Lamar Norsworthy, Michael E. Patrick, David Ross and Bruce W. Wilkinson,
filed as Exhibit 10.32 to the Annual Report on Form 10-K/A for
2002 of the
Company, and incorporated herein by reference.
|
|
|
10.35
|
Form
of Indemnification Agreement, effective February 20, 2003, by and
between
the Company and Mr. Jeff Altamari, Mr. Steve P. Beatty, Mr. John
Carne,
Mr. Hal Goldie, Mr. William C. Lemmer, Mr. Jack B. Moore, Mr. Franklin
Myers, Mr. Robert Rajeski, Mr. Charles M. Sledge, and Mr. Rick
Steans,
filed as Exhibit 10.36 to the Annual Report on Form 10-K for 2003
of the
Company, and incorporated herein by reference.
|
|
Exhibit
Number
|
Description
|
Sequential
Page
Number
|
|
10.36
|
Form
of Stock Option Agreement for grants dated November 22, 2004, under
the
Company's Long-Term Incentive Plan, filed as an exhibit to a Form
8-K
filed on January 18, 2005, and incorporated herein by
reference.
|
|
|
10.37
|
Change
of Control Agreement, dated February 19, 2004, by and between Dalton
Thomas and the Company, filed as Exhibit 10.49 to the Annual Report
on
Form 10-K for 2004 of the Company, and incorporated herein by
reference.
|
|
|
10.38
|
Form
of Restricted Stock Agreement for Restricted Stock Units granted
on
January 1, 2005, filed as Exhibit 10.50 to the Annual Report on
Form 10-K
for 2004 of the Company, and incorporated herein by
reference.
|
|
|
10.39
|
Form
of Restricted Stock Agreement for Restricted Stock Units granted
on
January 1, 2006, filed as Exhibit 10.39 to the Annual Report on
Form 10-K
for 2005 of the Company, and incorporated herein by
reference.
|
|
|
10.40
|
Form
of Stock Option Agreement for grants dated November 22, 2004, under
the
Company's Long-Term Incentive Plan, filed as an exhibit to a Form
8-K
filed on January 18, 2005, and incorporated herein by
reference.
|
|
|
10.41
|
The
Company's Deferred Compensation Plan for Non-Employee Directors,
filed as
Exhibit 10.41 to the Annual Report on Form 10-K for 2005 of the
Company,
and incorporated herein by reference.
|
|
|
10.42
|
The
Company's Long-Term Incentive Plan, as Amended and Restated as
of November
2002, incorporated by reference to the Company's Proxy Statement
for the
Annual Meeting of Stockholders held on May 8, 2003.
|
|
|
10.43
|
Sixth
Amendment to the Company's Long-Term Incentive Plan, as Amended
and
Restated as of November 2002, incorporated by reference to the
Company's
Proxy Statement for the annual meeting of Stockholders held on
May 8,
2003.
|
|
|
10.44
|
Seventh
Amendment to the Company's Long-Term Incentive Plan, filed as Exhibit
10.44 to the Annual Report on Form 10-K for 2004 of the Company,
and
incorporated herein by reference.
|
|
|
10.45
|
The
Company's Second Amended and Restated 1995 Stock Option Plan for
Non-Employee Directors (Registration Statement on Form S-8 No.
333-79787),
incorporated herein by reference.
|
|
|
10.46
|
First
Amendment to the Company's Second Amended and Restated 1995 Stock
Option
Plan for Non-Employee Directors, filed as Exhibit 10.43 to the
Annual
Report on Form 10-K for 2004 of the Company, and incorporated herein
by
reference.
|
|
|
10.47
|
Form
of Stock Option Agreement for stock options granted November 10,
2005,
filed as Exhibit 10.47 to the Annual Report on Form 10-K for 2005
of the
Company, and incorporated herein by reference.
|
|
| 10.48 | Third Amendment to the Company's 2005 Equity Incentive Plan, filed as Exhibit "A" of the Cameron International Corporation 2006 Proxy Statement. | |
| 10.49* | Fourth Amendment to the Company's 2005 Equity Incentive Plan. | |
| 10.50* | Change of Control Agreement, dated August 10, 2006, by and between Joseph H. Mongrain and Cameron International Corporation. | |
|
13.1*
|
Portions
of the 2006 Annual Report to Stockholders are included as an exhibit
to
this report.
|
|
|
14.1
|
Code
of Business Conduct and Ethics for Directors incorporated by reference
to
the Company's Proxy Statement for the annual meeting of Stockholders
held
on May 8, 2003.
|
|
|
14.2
|
Code
of Ethics for Management Personnel, filed as Exhibit 14.2 to the
Annual
Report on Form 10-K for 2004 of the Company, and incorporated herein
by
reference.
|
|
|
14.3
|
Standards
of Conduct, filed as Exhibit 14.3 to the Annual Report on Form
10-K for
2004 of the Company, and incorporated herein by reference.
|
|
Exhibit
Number
|
Description
|
Sequential
Page
Number
|
|
21.1*
|
Subsidiaries
of registrant.
|
|
|
23.1*
|
Consent
of Independent Registered Public Accounting Firm.
|
|
|
31.1*
|
Certification.
|
|
|
31.2*
|
Certification.
|
|
|
32.1*
|
Certification
of Chief Executive Officer and Chief Financial Officer Pursuant
to Section
906 of the Sarbanes-Oxley Act of 2002.
|
____________
* Filed
herewith