<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
CONTINENTAL MATERIALS CORPORATION
(Name of issuer)
COMMON STOCK, $.50 PAR VALUE & $.10 PAR VALUE
(Title of class of securities)
211615-20-8 ($.50 Par Value) & 211615-10-9 ($.10 Par Value)
(CUSIP number)
James G. Gidwitz
Continental Materials Corporation
225 W. Wacker Drive
Suite 1800
Chicago, IL 60606
(312) 541-7218
(Name, address and telephone number of person authorized to receive notices and
communications)
November 12, 1996
(Date of event which requires filing of this statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is filing
this schedule because of Rule 13d-1(b)(3) or (4), check the following box .
Check the following box if a fee is being paid with the statement . (A
fee is not required only if the reporting person: (1) has a previous statement
on file reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7):
NOTE: Six copies of this statement, including all exhibits, should be
filed with the Commission. SEE Rule 13d-1(a) for other parties
to whom copies are to be sent.
(Continued on following pages)
<PAGE>
- ------------------------- --------------------
211615-20-8 13D Page 2 of 18 Pages
CUSIP No. 211615-10-9
------------- --------------------
- -------------------------
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
CMC Partnership
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS
BK, PF
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) OR 2(e) / /
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Illinois
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF
0
SHARES -----------------------------------------------------------------
8 SHARED VOTING POWER
BENEFICIALLY
363,563
OWNED BY -----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
EACH
0
REPORTING -----------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
PERSON WITH
363,563
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
363,563
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
33%
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
PN
- --------------------------------------------------------------------------------
<PAGE>
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211615-20-8 13D Page 3 of 18 Pages
CUSIP No. 211615-10-9
------------- --------------------
- -------------------------
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
L.O.M. Holdings, Inc.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS
BK, PF
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) OR 2(e) / /
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Illinois
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF
0
SHARES -----------------------------------------------------------------
8 SHARED VOTING POWER
BENEFICIALLY
23,324
OWNED BY -----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
EACH
0
REPORTING -----------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
PERSON WITH
23,324
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
23,324
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / /
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
2.1 %
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
CO
- --------------------------------------------------------------------------------
<PAGE>
- ------------------------- --------------------
211615-20-8 13D Page 4 of 18 Pages
CUSIP No. 211615-10-9
------------- --------------------
- -------------------------
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
James G. Gidwitz
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) / /
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS
BK, PF
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) OR 2(e) / /
- --------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
- --------------------------------------------------------------------------------
7 SOLE VOTING POWER
NUMBER OF
386,887
SHARES -----------------------------------------------------------------
8 SHARED VOTING POWER
BENEFICIALLY
0
OWNED BY -----------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
EACH
386,887
REPORTING -----------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
PERSON WITH
0
- --------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
386,887
- --------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / /
- --------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
35.1 %
- --------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
- --------------------------------------------------------------------------------
<PAGE>
- ------------------------- --------------------
211615-20-8 13D Page 5 of 18 Pages
CUSIP No. 211615-10-9
------------- --------------------
- -------------------------
Item 1. SECURITY AND ISSUER.
(a) Title of class of securities: Common Stock, $.50 par value &
Common Stock, $.10 par value.
(b) Issuer: CONTINENTAL MATERIALS CORPORATION
225 West Wacker Drive, Suite 1800
Chicago, Illinois 60606.
Item 2. IDENTITY AND BACKGROUND.
(a)-(c) and (f)
<TABLE>
<CAPTION>
Name Business Address Principal occupation Citizenship
---- ---------------- -------------------- -----------
<S> <C> <C> <C>
A. CMC Partnership 225 West Wacker Drive Investment Illinois general
Suite 1800 Partnership partnership
Chicago, Illinois 60606
B. L.O.M. Holdings, 225 West Wacker Drive Holding Company for Illinois
Inc. Suite 1800 Travel Agencies corporation
Chicago, Illinois 60606
C. James G. Gidwitz Continental Materials Chairman of the United States of
Corporation Board, Chief America
225 West Wacker Drive Executive Officer and
Suite 1800 Director of
Chicago, Illinois 60606 Continental Materials
Corporation
</TABLE>
Schedule A-1 hereto, which is incorporated herein by reference, sets
forth information in response to this item regarding each partner of CMC
Partnership (the "Partnership") and each executive officer and director of
L.O.M. Holdings, Inc..
(d)-(e) None of the persons listed above in Item 2 has, during the last 5
years, been convicted in a criminal proceeding (excluding traffic violations and
similar misdemeanors) or has been a party to any civil proceeding of a judicial
or administrative body of competent jurisdiction and as a result was or is
subject to a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, Federal or State securities laws
or finding any violation with respect to such laws.
<PAGE>
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211615-20-8 13D Page 6 of 18 Pages
CUSIP No. 211615-10-9
------------- --------------------
- -------------------------
Item 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
It is expected that the funds to be used in acquiring the shares will
consist of personal funds and funds borrowed from one or more financing sources.
The sources and amounts involved have not been determined.
Item 4. PURPOSE OF TRANSACTION.
James G. Gidwitz ("JGG") has decided to pursue a "going private"
transaction (the "Transaction") involving Continental Materials Corporation (the
"Company"), as described in a proposal letter dated November 13, 1996 submitted
by JGG to the Company, a copy of which is included as Exhibit 2 hereto (the
"Proposal Letter"). JGG expects to offer to certain members of the Gidwitz
family (the "Family") the opportunity to participate with him in such
transaction. In connection therewith, the Partnership and L.O.M. Holdings,
Inc., who in the aggregate own approximately 35% of the Company's common stock,
$.50 par value and $.10 par value (collectively, the "Common Stock") have
decided that they will vote their shares in favor of any transaction proposed by
members of the Family, approved by the Board of Directors of the Company or any
special committee of such Board, and having financial terms no less favorable
to the holders of the Company's Common Stock than the offer described in the
Proposal Letter. The Partnership and L.O.M. Holdings, Inc. also decided to vote
against any other transaction.
Accordingly, JGG has, on behalf of himself and the other members of
the Family who will ultimately conclude to participate in the transaction (the
"Participating Family Members"), submitted the following offer to the Board of
Directors of the Company:
- The Participating Family Members will seek to acquire 100% of the
Company's Common Stock not owned by the Participating Family
Members for $21 per share in cash, assuming that all outstanding
options are exercised prior to such acquisition. It is expected
that such acquisition will include a merger of Newco (a company
to be formed by the Participating Family Members) with and into
the Company.
- The Transaction will be subject to various closing conditions,
including, among other things, the following:
- The negotiation and approval by a Special Committee of
the Board comprised of disinterested directors, and
ultimately the full Board, of a definitive written
acquisition agreement.
- The execution of such definitive written agreement and
the satisfaction or waiver of the agreed upon closing
conditions, including a financing condition, for both
acquisition funding and working capital.
<PAGE>
- ------------------------- --------------------
211615-20-8 13D Page 7 of 18 Pages
CUSIP No. 211615-10-9
------------- --------------------
- -------------------------
It is expected that consumation of the Transaction will result in one
or more of the matters set forth in subparagraphs (a)-(j) of Item 4 of Schedule
13D, including as follows:
(i) The Transaction is expected to result in having certain of the
Participating Family designees ultimately elected to the Company's Board of
Directors in place of, or in addition to, some, or all of the Company's present
Directors.
(ii) In connection with the Transaction, the economic feasibility of
the payment of dividends on the Company's common voting shares will be
evaluated.
(iii) The Transaction is expected to result in changes in the Company's
charter and by-laws, including to declassify the Company's Board of Directors.
(iv) Consumation of the Transaction is expected to result in the
delisting of the Company's shares from a national securities exchange or
cessation of the authorization of the Company's shares to be quoted in an inter-
dealer quotation system of a registered national securities association.
(v) Consumation of the Transaction is expected to result in a class
of the equity securities of the Company becoming eligible for termination or
registration pursuant to Section 12(g)(4) of the Securities Exchange Act of
1934.
Item 5. INTEREST IN SECURITIES OF THE ISSUER.
(a)-(b) Information concerning the number of shares of the
Company's Common Stock beneficially owned by the reporting persons is contained
in the respective cover pages of this Schedule 13D for each person and all of
such information is incorporated herein by reference. Additional information is
furnished below.
The Partnership is an Illinois general partnership which was formed by
members of the Family to hold shares of the Company's Common Stock beneficially
owned by various members of the Family and trusts established for their benefit.
The Partnership is the record owner of 363,563 shares of the Company's Common
Stock.
Gerald Gidwitz, Ronald J. Gidwitz, James G. Gidwitz and Ralph W.
Gidwitz are managing general partners of the Partnership and, as such, share
voting and investment power over 363,563 shares of the Company's Common Stock
held by the Partnership.
As general partners of the Partnership (but not managing partners)
Nancy Gidwitz, Peter E. Gidwitz, Thomas R. Gidwitz, Linda B. Karamitis, Teri L.
Gidwitz, The AKG Collateral Trust, The AKG Family Trust, The JLG Foundation, The
Thomas R. Gidwitz Irrevocable Trust, The Betsy R. Gidwitz Irrevocable Trust, The
GG Irrevocable Trust, The Jane B. Gidwitz Revocable Trust, The Trusts U/W/O
Emily K. Gidwitz, Trusts R6701, R6702, Trusts J1, J2, J3, J4, J5, J6, Trusts
A6701, A6702, A6703, Aries Associates and ARB Associates
<PAGE>
- ------------------------- --------------------
211615-20-8 13D Page 8 of 18 Pages
CUSIP No. 211615-10-9
------------- --------------------
- -------------------------
may also be deemed to share voting and investment power over the 363,563 shares
of the Company's Common Stock held by the Partnership.
James G. Gidwitz, Jane B. Gidwitz, Gerald Gidwitz, Ronald J. Gidwitz,
Dr. Betsy R. Gidwitz, Alan K. Gidwitz and Thomas R. Gidwitz also act as trustees
of various trusts established for the benefit of members of the Family, which
trusts are general partners of the Partnership and thus these individuals may
also be deemed beneficial owners of the 363,563 shares of the Company's Common
Stock owned by the Partnership.
James G. Gidwitz, Ronald J. Gidwitz, Ralph W. Gidwitz and Melvin
Pollack share voting and investment power over 23,324 shares of the Company's
Common Stock owned by L.O.M. Holdings, Inc., a company owned by members of the
Family which, through subsidiaries, is engaged in the travel agency business.
James G. Gidwitz, Joseph J. Sum and Mark S. Nichter share voting and
investment power over 58,608 shares of the Company's Common Stock owned by the
Continental Materials Corporation Employee Profit Sharing Retirement Plan as to
which they serve as trustees.
Si Richard Wynn is a trustee of the following trusts which were
established for the benefit of various Family members and which trusts are
general partners of the Partnership: the AKG Collateral Trust, the AKG Family
Trust, Trusts R6701, R6702, Trusts J1, J2, J3, J4, J5, J6, Trusts A6701, A6702,
A6703. Mr. Wynn may be deemed to share voting and investment power over the
363,563 shares of the Company's Common Stock held by the Partnership by virtue
of his acting as a trustee of trusts which are general partners of the
Partnership.
Melvin Pollack is a trustee of the following trusts which were
established for the benefit of various Family members and which trusts are
general partners of the Partnership: Trusts R6701, R6702 and Trusts A6701,
A6702, A6703. Mr. Pollack may be deemed to share voting and investment power
over the 363,563 shares of the Company's Common Stock held by the Partnership
by virtue of his acting as a trustee of trusts which are general partners of the
Partnership. Mr. Pollack is also the President of L.O.M. Holdings, Inc. and
shares voting and investment power over 23,324 shares of the Company's Common
Stock owned by L.O.M. Holdings, Inc.
Richard Horwood is a trustee of The BRG Irrevocable Trust and The GG
Irrevocable Trust which were established for the benefit of various Family
members and which trusts are general partners of the Partnership. Mr. Horwood
may be deemed to share voting and investment power over the 363,563 shares of
the Company's Common Stock held by the Partnership by virtue of his acting as a
trustee of trusts which are general partners of the Partnership.
As of November 12, 1996, the Company had an aggregate of 1,103,211
shares of Common Stock outstanding, and the reporting persons beneficially owned
in the aggregate 393,049 shares of the Company's Common Stock. The 393,049
shares beneficially owned by the reporting persons constitute approximately 35%
of the outstanding shares of the Company's Common Stock.
<PAGE>
- ------------------------- --------------------
211615-20-8 13D Page 9 of 18 Pages
CUSIP No. 211615-10-9
------------- --------------------
- -------------------------
Item 6. Contracts, Arrangements, Understandings or
RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER.
Jane B. Gidwitz is the wife of Gerald Gidwitz. Peter E. Gidwitz,
Thomas R. Gidwitz, Ronald J. Gidwitz, Nancy R. Gidwitz and James G. Gidwitz are
the children of Jane and Gerald Gidwitz.
Alan K. Gidwitz, Ralph W. Gidwitz and Dr. Betsy R. Gidwitz are the
children of Joseph and Emily Gidwitz, both of whom are deceased.
Teri L. Gidwitz and Linda B. Karamitis are the children of Ralph W.
Gidwitz.
The information with respect to the understandings among the persons
named in Item 2 with respect to the shares of Common Stock of the Company has
been provided in Item 4 and all of such information is incorporated herein by
reference.
Item 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit Number Description
- -------------- -----------
1 Power of Attorney/Joint Filing Agreement dated as of
November 12, 1996 by and among James G. Gidwitz and every
other signatory thereto relating to the joint filing of this
Schedule 13D.
2 Proposal Letter dated November 13, 1996 from James G.
Gidwitz to the Board of Directors of the Company.
<PAGE>
- ------------------------- --------------------
211615-20-8 13D Page 10 of 18 Pages
CUSIP No. 211615-10-9
------------- --------------------
- -------------------------
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Date: November 19, 1996
CMC PARTNERSHIP
By: /s/ James G. Gidwitz
-------------------------------
James G. Gidwitz
ATTORNEY-IN-FACT
<PAGE>
- ------------------------- --------------------
211615-20-8 13D Page 11 of 18 Pages
CUSIP No. 211615-10-9
------------- --------------------
- -------------------------
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Date: November 19, 1996
L.O.M. HOLDINGS, INC.
By: /s/ James G. Gidwitz
-------------------------------
James G. Gidwitz
ATTORNEY-IN-FACT
<PAGE>
- ------------------------- --------------------
211615-20-8 13D Page 12 of 18 Pages
CUSIP No. 211615-10-9
------------- --------------------
- -------------------------
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Date: November 19, 1996
JAMES G. GIDWITZ
By: /s/ James G. Gidwitz
-------------------------------
James G. Gidwitz
<PAGE>
- ------------------------- --------------------
211615-20-8 13D Page 13 of 18 Pages
CUSIP No. 211615-10-9
------------- --------------------
- -------------------------
Schedule A-1
I. Partners of CMC Partnership
Principal
Name Business Address occupation Citizenship
---- ---------------- ---------- -----------
A. Gerald S. c/o Continental Retired United
Gidwitz Materials States of
Corporation America
225 West Wacker
Drive
Suite 1800
Chicago, Illinois
60606
B. James G. Continental Chairman of the United
Gidwitz Materials Board, Chief States of
Corporation Executive America
225 West Wacker Officer and
Drive Director of
Suite 1800 Continental
Chicago, Illinois Materials
60606 Corporation
C. Ronald J. Helene Curtis President and United
Gidwitz Industries, Inc. Chief Executive States of
325 North Wells Officer - America
Street, Helene Curtis
Chicago, Illinois Industries,
60610 Inc.
Director -
Continental
Materials
Corporation
D. Ralph W. RKG Corporation President, United
Gidwitz 225 West Wacker Chief Executive States of
Drive Officer and America
Suite 1800 Director of RKG
Chicago, Illinois Corporation
60606
Director -
Continental
Materials
Corporation
<PAGE>
- ------------------------- --------------------
211615-20-8 13D Page 14 of 18 Pages
CUSIP No. 211615-10-9
------------- --------------------
- -------------------------
Principal
Name Business Address occupation Citizenship
---- ---------------- ---------- -----------
E. Peter E. c/o Burnham Director, United
Gidwitz Development Company, Burnham States of
225 West Wacker Development America
Drive Company
Suite 1800
Chicago, Illinois
60606
F. Nancy Gidwitz c/o Continental Public United
Materials Relations States of
Corporation Executive, America
225 West Wacker Lesnik Public
Drive Relations,
Suite 1800 455 North City
Chicago, Illinois Front Plaza,
60606 15th Floor,
Chicago,
Illinois 60611
G. Thomas R. c/o Continental Writer United
Gidwitz Materials States of
Corporation America
225 West Wacker
Drive
Suite 1800
Chicago, Illinois
60606
H. Linda B. c/o Continental Not working United
Karamitis Materials States of
Corporation America
225 West Wacker
Drive
Suite 1800
Chicago, Illinois
60606
I. Teri L. Gidwitz c/o Continental Marketing United
Materials Director for States of
Corporation Radio Station America
225 West Wacker Windy City
Drive Broadcasting,
Suite 1800 Inc.,
Chicago, Illinois 4949 West
60606 Belmont Avenue,
Chicago,
Illinois 60641
<PAGE>
- ------------------------- --------------------
211615-20-8 13D Page 15 of 18 Pages
CUSIP No. 211615-10-9
------------- --------------------
- -------------------------
Principal
Name Business Address occupation Citizenship
---- ---------------- ---------- -----------
J. AKG Collateral c/o Continental Not applicable Illinois
Trust U/A dated Materials
6/28/88 Corporation
225 West Wacker
Drive
Suite 1800
Chicago, Illinois
60606
K. AKG Family c/o Continental Not applicable Illinois
Trust U/A dated Materials
6/28/88 Corporation
225 West Wacker
Drive
Suite 1800
Chicago, Illinois
60606
L. JLG Foundation c/o Continental Not applicable Illinois
Materials
Corporation
225 West Wacler
Drive
Suite 1800
Chicago, Illinois
60606
M. Thomas R. c/o Continental Not applicable Illinois
Gidwitz Materials
Irrevocable Corporation
Trust U/A dated 225 West Wacker
1/1/89 Drive,
Suite 1800
Chicago, Illinois
60606
N. Betsy R. c/o Continental Not applicable Illinois
Gidwitz Materials
Irrevocable Corporation
Trust U/A dated 225 West Wacker
9/15/90 Drive
Suite 1800
Chicago, Illinois
60606
O. GG Irrevocable c/o Continental Not applicable Illinois
Trust U/A dated Materials
3/12/93 Corporation
225 West Wacker
Drive
Suite 1800
Chicago, Illinois
60606
<PAGE>
- ------------------------- --------------------
211615-20-8 13D Page 16 of 18 Pages
CUSIP No. 211615-10-9
------------- --------------------
- -------------------------
Principal
Name Business Address occupation Citizenship
---- ---------------- ---------- -----------
P. Jane B. Gidwitz c/o Continental Not applicable Illinois
Revocable Trust Materials
U/A dated Corporation
12/15/78 225 West Wacker
Drive
Suite 1800
Chicago, Illinois
60606
Q. Trusts U/W/O c/o Continental Not applicable Illinois
Emily K. Materials
Gidwitz dated Corporation
1/10/80 225 West Wacker
Drive
Suite 1800
Chicago, Illinois
60606
R. Trusts R6701, c/o Continental Not applicable Illinois
6702 Materials
Corporation
225 West Wacker
Drive
Suite 1800
Chicago, Illinois
60606
S. Trusts J1, J2, c/o Continental Not applicable Illinois
J3, J4, J5 and Materials
J6 Corporation
225 West Wacker
Drive
Suite 1800
Chicago, Illinois
60606
T. Trusts A6701, c/o Continental Not applicable Illinois
A6702, A6703 Materials
Corporation
225 West Wacker
Drive
Suite 1800
Chicago, Illinois
60606
<PAGE>
- ------------------------- --------------------
211615-20-8 13D Page 17 of 18 Pages
CUSIP No. 211615-10-9
------------- --------------------
- -------------------------
Principal
Name Business Address occupation Citizenship
---- ---------------- ---------- -----------
U. Aries c/o Continental Not applicable Illinois
Associates Materials
Corporation
225 West Wacker
Drive
Suite 1800
Chicago, Illinois
60606
GENERAL PARTNERS OF ARIES ASSOCIATES
RONALD J. GIDWITZ - See Item I.A.
JAMES G. GIDWITZ - See Item I.B.
PETER E. GIDWITZ - See Item I.E.
NANCY GIDWITZ - See Item I.F.
THOMAS R. GIDWITZ - See Item I.G.
V. ARB Associates c/o Continental Not applicable Illinois
Materials general
Corporation partnership
225 West Wacker
Drive
Suite 1800
Chicago, Illinois
60606
GENERAL PARTNERS OF ARB ASSOCIATES
ALAN K. GIDWITZ - c/o Continental Materials Corporation
225 West Wacker Drive, Suite 1800
Chicago, Illinois 60606
Occupation - Enterpreneur
Citizenship - United States of America
RALPH W. GIDWITZ - See Item I.D.
BETSY R. GIDWITZ IRREVOCABLE TRUST U/A DATED 9/15/90
- See Item I.N.
<PAGE>
- ------------------------- --------------------
211615-20-8 13D Page 18 of 18 Pages
CUSIP No. 211615-10-9
------------- --------------------
- -------------------------
II. EXECUTIVE OFFICERS OF L.O.M. HOLDINGS, INC.
MELVIN POLLACK, President - c/o L.O.M. Holdings, Inc.
225 West Wacker Drive
Suite 1800, Chicago
Illinois 60606
Citizenship - United States of America
JAMES G. GIDWITZ, Vice President - See Item I.B.
III. DIRECTORS OF L.O.M. HOLDINGS, INC.
RONALD J. GIDWITZ, see Item I.C.
RALPH W. GIDWITZ, see Item I.D.
JAMES G. GIDWITZ, see Item I.B.
<PAGE>
Exhibit 1
POWER OF ATTORNEY/JOINT FILING AGREEMENT
Each of the undersigned designates James G. Gidwitz as its agent and
attorney-in-fact for the purpose of executing any and all Schedule 13D filings
required to be made by the undersigned with the Securities and Exchange
Commission (the "SEC"). Each of the undersigned further agrees pursuant to Rule
13d-1(f) promulgated by the SEC under the Securities Exchange Act of 1934, as
amended, that such reports on Schedule 13D, and all amendments thereto, may be
filed in a single statement along with one or more of the persons, Trusts and
entities signatory hereto, in each case as and to the extent determined by James
G. Gidwitz.
DATED: November 12, 1996
/s/ Gerald Gidwitz /s/ Ronald Gidwitz
- ---------------------- ----------------------
Gerald Gidwitz Ronald Gidwitz
/s/ James Gidwitz /s/ Nancy Gidwitz
- ---------------------- ----------------------
James Gidwitz Nancy Gidwitz
/s/ Peter Gidwitz /s/ Thomas Gidwitz
- ---------------------- ----------------------
Peter Gidwitz Thomas Gidwitz
/s/ Ralph W. Gidwitz /s/ Teri Gidwitz
- ---------------------- ----------------------
Ralph W. Gidwitz Teri Gidwitz
/s/ Linda Gidwitz Karamitis /s/ Steven Gidwitz
- ---------------------- ----------------------
Linda Gidwitz Karamitis Steven Gidwitz
/s/ Julie Gidwitz /s/ Jill Gidwitz
- ---------------------- ----------------------
Julie Gidwitz Jill Gidwitz
<PAGE>
JANE B. GIDWITZ REVOCABLE TRUST ARIES ASSOCIATES
By: /s/ Jane B. Gidwitz By: /s/ Ronald Gidwitz
---------------------- --------------------------
Jane B. Gidwitz, not Ronald Gidwitz, a
individually but General Partner
solely as Trustee
GERALD GIDWITZ TRUST THOMAS R. GIDWITZ
IRREVOCABLE TRUST
By: /s/ James Gidwitz By: /s/ James Gidwitz
---------------------- --------------------------
James Gidwitz, not James Gidwitz, not
individually but individually but
solely as Trustee solely as Trustee
By: /s/ Ronald Gidwitz By: /s/ Jane B. Gidwitz
---------------------- --------------------------
Ronald Gidwitz, not Jane B. Gidwitz, not
individually but individually but
solely as Trustee solely as Trustee
JOSEPH L. & EMILY K. GIDWITZ TRUST U/W/O EMILY K.
MEMORIAL FOUNDATION GIDWITZ
By: /s/ Betsy R. Gidwitz By: /s/ Alan K. Gidwitz
---------------------- --------------------------
Betsy R. Gidwitz, an Alan K. Gidwitz, not
officer individually but
solely as Trustee
BETSY R. GIDWITZ IRREVOCABLE
TRUST
By: /s/ Ralph W. Gidwitz
------------------------
Ralph W. Gidwitz, not
By: /s/ Ronald Gidwitz individually but
---------------------------- solely as Trustee
Ronald Gidwitz, not
individually but
solely as Trustee
By: /s/ Betsy R. Gidwitz
-------------------------
Betsy R. Gidwitz, not
By: /s/ Richard M. Harwood individually but
----------------------- solely as Trustee
Richard M. Horwood, not
individually but solely
as Trustee
By: /s/ Gerald Gidwitz
-------------------------
Gerald Gidwitz, not
individually but
solely as Trustee
-2-
<PAGE>
AKG COLLATERAL TRUST AKG FAMILY TRUST
By: /s/ Si Richard Wynn By: /s/ Si Richard Wynn
---------------------- --------------------------
Si Richard Wynn, not Si Richard Wynn, not
individually but solely individually but
as Trustee solely as Trustee
TRUSTS A6701, A6702, A6703 TRUSTS J1, J2, J3, J4,
J5, J6
By: /s/ Melvin Pollack By: /s/ Si Richard Wynn
---------------------- --------------------------
Melvin Pollack, not Si Richard Wynn, not
individually but individually but
solely as Trustee solely as Trustee
By: /s/ Si Richard Wynn By: /s/ Thomas R. Gidwitz
---------------------- --------------------------
Si Richard Wynn, not Thomas R. Gidwitz,
individually but not individually but
solely as Trustee solely as Trustee
TRUSTS R6701, R6702 ARB ASSOCIATES
By: /s/ Melvin Pollack By: /s/ Ralph W. Gidwitz
---------------------- --------------------------
Melvin Pollack, not Ralph W. Gidwitz, a
individually but General Partner
solely as Trustee
By: Betsy R. Gidwitz
Irrevocable Trust, a
By: /s/ Si Richard Wynn General Partner
----------------------
Si Richard Wynn, not
individually but
solely as Trustee By: /s/ Ronald Gidwitz
-------------------------
Ronald Gidwitz, not
CMC PARTNERSHIP individually but
solely as Trustee
By: /s/ Ralph W. Gidwitz
----------------------
Name: Ralph W. Gidwitz By: /s/ Richard M. Horwood
Title: Managing Partner -----------------------
Richard M. Horwood,
not individually but
L.O.M. HOLDINGS, INC. solely as Trustee
By: /s/ Ralph W. Gidwitz
-----------------------
Name: Ralph W. Gidwitz
Title: Vice President
-3-
<PAGE>
Exhibit 2
PRIVILEGED AND CONFIDENTIAL
Board of Directors
Continental Materials Corporation
225 West Wacker Drive
Suite 1800
Chicago, Illinois 60606
November 13, 1996
Ladies and Gentlemen of the Board:
Last evening, at a meeting of various members of my extended family (the
"Family"), I decided to pursue, on behalf of myself and other Family members, a
"going private" transaction involving Continental Materials Corporation (the
"Company").
Toward that end, Family members, who in the aggregate own approximately 35%
of the Company's common stock have decided that they will vote their shares in
favor of any transaction proposed by members of the Family and having financial
terms no less favorable to the holders of the Company's common stock than the
offer described below (the "Offer"). The Family members also decided to vote
their shares against any other transaction. Certain implications of these
decisions (collectively, the "Voting Decision") are discussed below. Attached
hereto is a letter confirming the foregoing.
On behalf of ourselves and the other members of the Family who will
ultimately conclude to participate in the transaction (the "Participating Family
Members"), we are pleased to submit the following offer:
- Newco (a corporation to be formed by the Participating Family
Members) will seek to acquire 100% of the Company's common stock
not owned by the Participating Family Members for $21 per share
in cash, assuming that all outstanding options are exercised
prior to such acquisition.
- The transaction will be subject to the following conditions:
* The negotiation and approval by a Special Committee of
the Board, and ultimately the full Board, of a
definitive written acquisition agreement. In the
interest of time, a draft of such agreement is
attached. The Special Committee should be comprised of
disinterested directors, should be selected by the
disinterested directors, should be chaired by a person
selected
<PAGE>
Page 2
by its members and should be independently advised by
counsel and investment bankers of its choice.
* The execution of such definitive written agreements and
the satisfaction or waiver of the agreed upon closing
conditions. Our proposal, as to closing conditions, is
embodied in the enclosed draft. Not surprisingly,
there is a financing condition, for both acquisition
funding and working capital. Based on the primary
indications from the financing sources we contacted
regarding this matter, we expect that we will be able
to satisfy the financing condition.
It is our goal to have an acquisition agreement fully negotiated by the
middle of December. One reason we believe that this goal is attainable is that
the scope of the Special Committee's work will be limited. While the Special
Committee, based on the advice of counsel, will have to reach its own
conclusion, we believe that its role will be solely to consider the fairness of
the Offer, to negotiate with us and to decide whether to recommend the Offer to
the full Board. Because of the combined effect of (i) the Voting Decision, (ii)
the 66 2/3% merger vote requirement under the Company's charter and (iii) the
decision of the Delaware Court of Chancery in the case involving Katy
Industries, we believe that the Board has no duty to seek a higher offer under
REVLON.
In connection with the Offer and the Voting Decision, certain SEC filings
will be made by the Family. As a result, we believe it would be appropriate for
the Company to issue a press release. A draft is also attached.
We will end where, perhaps, we should have started -- explaining why we are
proposing a transaction. Fundamentally, we believe that the benefits to the
Company of being public are significantly outweighed by the associated costs.
Further, because the Company is so small and has a real public float of between
one-half and two-thirds of its outstanding shares, the market for its shares
lacks liquidity. Having said that, however, we as a Family are not willing to
sell our stock position to another entity. Simply put, we believe the Company
will prosper best as a privately held entity under our leadership and ownership.
We are hopeful that you will agree that this transaction makes great sense
and that the Offer is fair. We look forward to receiving your response.
Sincerely,
/s/ James G. Gidwitz
-------------------------------
James G. Gidwitz
