SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 14D-1
TENDER OFFER STATEMENT PURSUANT TO SECTION 14(D)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
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DYNAMICS CORPORATION OF AMERICA
(Name of Subject Company)
WHX CORPORATION
SB ACQUISITION CORP.
(Bidders)
COMMON STOCK, PAR VALUE $.10 PER SHARE
(INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS)
(Title of Class of Securities)
268039 10 4
(CUSIP Number of Class of Securities)
MR. RONALD LABOW
CHAIRMAN OF THE BOARD
WHX CORPORATION
110 EAST 59TH STREET
NEW YORK, NY 10022
TELEPHONE: (212) 355-5200
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications on Behalf of Bidder)
with a copy to:
ILAN K. REICH, ESQ.
OLSHAN GRUNDMAN FROME & ROSENZWEIG LLP
505 PARK AVENUE
NEW YORK, NEW YORK 10022
TELEPHONE: (212) 753-7200
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CALCULATION OF FILING FEE
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TRANSACTION VALUATION* AMOUNT OF FILING FEE**
$25,960,000.00 $5,192.00
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* For purposes of calculating the filing fee only. This calculation
assumes the purchase of up to 649,000 shares of Common Stock, par value
$.10 per share (the "Shares") of Dynamics Corporation of America (the
"Company") at a price of $40 per Share, net to the seller in cash,
without interest thereon.
** The amount of the filing fee, calculated in accordance with Rule
0-11(d) of the Securities Exchange Act of 1934, as amended, equals
1/50th of one percent of the aggregate value of cash offered by SB
Acquisition Corp. for such number of Shares.
/ /* Check box if any part of the fee is offset as provided by Rule
0-11(a)(2) and identify the filing with which the offsetting fee was
previously paid. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
Amount Previously Paid: Not applicable
Form or Registration No.: Not applicable
Filing Party: Not applicable
Date Filed: Not applicable
<PAGE>
1. NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
WHX Corporation (E.I.N.: 13-3768097)
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) /X/
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
WC
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(e) or 2(f) / /
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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7. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
0
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8. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW
(7) EXCLUDES CERTAIN SHARES
/ /
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9. PERCENT OF CLASS REPRESENTED BY AMOUNT IN
ROW (7)
0.0%
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10. TYPE OF REPORTING PERSON
HC and CO
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<PAGE>
1. NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
SB ACQUISITION CORP. (E.I.N.: Applied For)
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / /
(b) /X/
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
AF
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS
IS REQUIRED PURSUANT TO ITEMS 2(e) or 2(f) / /
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
New York
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7. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
109,600 Common Shares
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8. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7)
EXCLUDES CERTAIN SHARES / /
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9. PERCENT OF CLASS REPRESENTED BY AMOUNT
IN ROW (7)
2.9%
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10. TYPE OF REPORTING PERSON
CO
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<PAGE>
ITEM 1. SECURITY AND SUBJECT COMPANY.
(a) The name of the subject company is Dynamics Corporation of America,
a New York corporation (the "Company"). The address of the Company's principal
executive offices is 475 Steamboat Road, Greenwich, Connecticut 06830.
(b) This Tender Offer Statement on Schedule 14D-1 relates to the offer
by SB Acquisition Corp. ("Purchaser"), a New York corporation and a wholly owned
subsidiary of WHX Corporation, a Delaware corporation ("Parent"), to purchase up
to the Specific Percentage (as defined in the Offer to Purchase which is defined
herein) of shares of Common Stock, par value $.10 per share (the "Shares") of
the Company, including the associated Common Stock Purchase Rights issued
pursuant to the Rights Agreement, dated as of January 30, 1986, as amended on
December 27, 1995 (the "Rights Agreement"), between the Company and First
National Bank of Boston, as Rights Agent, at a price of $40 per Share, net to
the seller in cash, without interest thereon, upon the terms and subject to the
conditions set forth in the Offer to Purchase, dated March 31, 1997 (the "Offer
to Purchase"), and in the related Letter of Transmittal (which, together with
any amendments or supplements thereto, constitute the "Offer"). The number of
Shares sought to be purchased in this Offer is subject to automatic downward
adjustment in the event the Company amends the trigger under the Rights
Agreement, as described in the Offer. As of March 14, 1997, 3,815,194 Shares
were outstanding. Based on publicly available information and after taking into
account the 109,600 Share (approximately 2.9%) owned by Purchaser, the number of
Shares to be purchased in the Offer is currently up to 649,000 (for a total of
approximately 19.9%). The information set forth under "Introduction" in the
Offer to Purchase annexed hereto as Exhibit (a)(1) is incorporated herein by
reference.
(c) The information set forth under "Price Range of Shares; Dividends"
in the Offer to Purchase is incorporated herein by reference.
ITEM 2. IDENTITY AND BACKGROUND.
(a)-(d); (g) This Statement is being filed by Purchaser and Parent. The
information set forth under "Introduction" and "Certain Information Concerning
Purchaser and Parent" in the Offer to Purchase and Schedules I and II thereto is
incorporated herein by reference.
(e)-(f) During the last five years, neither Purchaser, Parent nor any
persons controlling Purchaser, nor, to the best knowledge of Purchaser or
Parent, any of the persons listed on Schedules I and II to the Offer to Purchase
(i) has been convicted in a criminal proceeding (excluding traffic violations or
similar misdemeanors) or (ii) was a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction as a result of which any such
person was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting activities subject to, federal or state securities
laws or finding any violation of such laws.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY.
(a)-(b) The information set forth under "Introduction," "Background of
the Offer; Contacts with the Company," "Purpose of the Offer; The Merger Offer;
Proxy Solicitation; Plans for the Company," "Certain Information Concerning the
Company" and "Certain Information Concerning Purchaser and Parent" in the Offer
to Purchase is incorporated herein by reference.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a) The information set forth under "Introduction" and "Source and
Amount of Funds" in the Offer to Purchase is incorporated herein by reference.
(b)-(c) Not applicable.
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER.
(a)-(e) The information set forth under "Introduction," "Background of
the Offer; Contacts with the Company" and "Purpose of the Offer; The Merger
Offer; Proxy Solicitation; Plans for the Company" in the Offer to Purchase is
incorporated herein by reference.
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<PAGE>
(f)-(g) Not applicable.
ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.
(a)-(b) The information set forth under "Introduction," and "Certain
Information Concerning Purchaser and Parent" in the Offer to Purchase is
incorporated herein by reference.
ITEM 7. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO THE SUBJECT COMPANY'S SECURITIES.
The information set forth under "Introduction," "Purpose of the Offer;
The Merger Offer; Proxy Solicitation; Plans for the Company" and "Certain Legal
Matters; Regulatory Approvals" in the Offer to Purchase is incorporated herein
by reference.
ITEM 8. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.
The information set forth under "Fees and Expenses" in the Offer to
Purchase is incorporated herein by reference.
ITEM 9. FINANCIAL STATEMENTS OF CERTAIN BIDDERS.
The information set forth under "Certain Information Concerning
Purchaser and Parent" in the Offer to Purchase is incorporated herein by
reference.
ITEM 10. ADDITIONAL INFORMATION.
(a) Not applicable.
(b)-(c) The information set forth under "Introduction" and "Certain
Legal Matters; Regulatory Approvals" in the Offer to Purchase is incorporated
herein by reference.
(d)-(e) Not applicable.
(e) The information set forth in the Offer to Purchase and the Letter
of Transmittal, copies of which are attached hereto as Exhibits (a)(1) and
(a)(2), respectively, is incorporated herein by reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
(a) (1) Offer to Purchase, dated March 31, 1997.
(2) Letter of Transmittal.
(3) Notice of Guaranteed Delivery.
(4) Letter to Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees.
(5) Letter to Clients for use by Brokers, Dealers, Commercial
Banks, Trust Companies and Other Nominees.
(6) Guidelines for Certification of Taxpayer Identification
Number on Substitute Form W-9.
(7) Text of Press Release issued by WHX Corporation on March 31,
1997.
(8) Summary Advertisement being published on April 1, 1997.
(b) Not applicable.
(c) Not applicable.
(d) Not applicable.
(e) Not applicable.
(f) Not applicable.
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<PAGE>
SIGNATURE
After due inquiry and to the best of its knowledge and belief, the
undersigned certifies that the information set forth in this statement is true,
complete and correct.
Dated: March 31, 1997
WHX CORPORATION
By: /S/ STEWART E. TABIN
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Name: Stewart E. Tabin
Title: Assistant Treasurer
SB ACQUISITION CORP.
By: /S/ STEWART E. TABIN
---------------------------
Name: Stewart E. Tabin
Title: Vice President
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<PAGE>
EXHIBIT INDEX
EXHIBIT
NUMBER PAGE
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(a) (1) Offer to Purchase, dated March 31, 1997.
(2) Letter of Transmittal.
(3) Notice of Guaranteed Delivery.
(4) Letter to Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees.
(5) Letter to Clients for use by Brokers, Dealers, Commercial
Banks, Trust Companies and Other Nominees.
(6) Guidelines for Certification of Taxpayer Identification
Number on Substitute Form W-9.
(7) Text of Press Release issued by WHX Corporation on March 31,
1997.
(8) Summary Advertisement being published on April 1, 1997.
(b) Not applicable.
(c) Not applicable.
(d) Not applicable.
(e) Not applicable.
(f) Not applicable.
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EXHIBIT (A)(1)
OFFER TO PURCHASE FOR CASH
UP TO THE SPECIFIED PERCENTAGE OF SHARES OF
COMMON STOCK (INCLUDING THE ASSOCIATED RIGHTS) OF
DYNAMICS CORPORATION OF AMERICA
AT $40 PER SHARE
BY SB ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
WHX CORPORATION
THE "SPECIFIED PERCENTAGE" SHALL INITIALLY MEAN THAN NUMBER OF SHARES WHICH,
TOGETHER WITH THE SHARES ALREADY OWNED BY SB ACQUISITION CORP. OR WHX
CORPORATION, EQUALS 19.9% OF THE OUTSTANDING SHARES. IN THE EVENT DYNAMICS
CORPORATION OF AMERICA AMENDS THE "POISON PILL" RIGHTS AGREEMENT TO REDUCE BELOW
20% THE OWNERSHIP LEVEL AT WHICH A SHAREHOLDER BECOMES AN ACQUIRING PERSON, THEN
THE SPECIFIED PERCENTAGE SHALL AUTOMATICALLY BE COMMENSURATELY REDUCED.
BASED ON PUBLICLY AVAILABLE INFORMATION AND AFTER TAKING INTO ACCOUNT THE
109,600 SHARES (APPROXIMATELY 2.9%) WHICH SB ACQUISITION CORP. ALREADY OWNS, THE
NUMBER OF SHARES TO BE PURCHASED IS CURRENTLY UP TO 649,000.
------------------------
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON TUESDAY, APRIL 29, 1997, UNLESS THE OFFER IS EXTENDED.
THE OFFER IS NOT SUBJECT TO ANY MINIMUM NUMBER OF SHARES BEING TENDERED.
------------------------
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) ANY APPLICABLE WAITING
PERIOD UNDER THE HART-SCOTT-RODINO ANTITRUST IMPROVEMENTS ACT OF 1976, AS
AMENDED (THE "HSR ACT"), SHALL HAVE EXPIRED OR BEEN TERMINATED PRIOR TO THE
EXPIRATION OF THE OFFER, AND (2) THE COMPANY NOT HAVING ENTERED INTO OR
EFFECTUATED ANY AGREEMENTS WITH ANY PERSON OR ENTITY HAVING THE EFFECT OF
IMPAIRING PURCHASER'S ABILITY TO ACQUIRE THE COMPANY OR OTHERWISE DIMINISHING
THE EXPECTED ECONOMIC VALUE TO PURCHASER OF THE ACQUISITION OF THE COMPANY. SEE
SECTION 13. ALSO, TENDERS ARE SUBJECT TO THE SATISFACTION BY EACH TENDERING
SHAREHOLDER OF THE RECORD HOLDER CONDITION (DESCRIBED BELOW).
------------------------
IMPORTANT
Any shareholder desiring to tender all or any portion of such
shareholder's Shares (as defined herein) should either (i) complete and sign the
Letter of Transmittal (or a facsimile thereof) in accordance with the
instructions in the Letter of Transmittal, have such shareholder's signature
thereon guaranteed if required by Instruction 1 to the Letter of Transmittal,
mail or deliver the Letter of Transmittal (or such facsimile thereof) and any
other required documents to the Depositary and either deliver the certificates
for such Shares to the Depositary along with the Letter of Transmittal (or a
facsimile thereof) or deliver such Shares pursuant to the procedure for
book-entry transfer set forth in Section 3 prior to the expiration of the Offer
or (ii) request such shareholder's broker, dealer, commercial bank, trust
company or other nominee to effect the transaction for such shareholder.
<PAGE>
Shares shall not be deemed to be duly or properly tendered, and they
will not be accepted for purchase by the Purchaser, unless (i) they are tendered
to the Purchaser by the shareholders of record as of the close of business on
March 14, 1997 (the "Record Holder"); or (ii) they are tendered to the Purchaser
by or on behalf of a shareholder who has obtained a valid, irrevocable proxy to
vote such Shares in connection with their purchase directly from the Record
Holder, or pursuant to a chain of purchasers from the Record Holder whereby each
successive purchaser through and including the shareholder tendering Shares to
the Purchaser has obtained a valid, irrevocable proxy to vote such Shares in
connection with the purchase of such Shares from the proxy owner of such Shares;
or (iii) if tendered by a shareholder not meeting the criteria of subparagraph
(i) or (ii) immediately above, the Shares tendered are accompanied by a proxy
duly executed by the Record Holder in favor of the shareholder tendering his
Shares to the Purchaser. The requirements stated in clauses (i) - (iii) above
are referred to as the "Record Holder Condition."
A shareholder having Shares registered in the name of a broker, dealer,
commercial bank, trust company or other nominee must contact such broker,
dealer, commercial bank, trust company or other nominee if such shareholder
desires to tender such Shares.
The Purchaser intends to solicit proxies from shareholders of the
Company at the Company's Annual Meeting of Shareholders scheduled to be held on
May 2, 1997 to (i) elect to the Company's Board of Directors four nominees of
the Purchaser, which, if elected, would constitute a majority of such Board of
Directors, and (ii) adopt shareholder by-laws which will permit holders of at
least 9.9% of the Shares to call a special meeting and permit the removal of
directors at any time without cause.
Any shareholder who desires to tender Shares and whose certificates for
such Shares are not immediately available, or who cannot comply with the
procedures for book-entry transfer described in this Offer to Purchase on a
timely basis, may tender such Shares by following the procedures for guaranteed
delivery set forth in Section 3.
Questions and requests for assistance or for additional copies of this
Offer to Purchase, the Letter of Transmittal or other tender offer materials,
may be directed to the Information Agent (as defined herein) at its address and
telephone number set forth on the back cover of this Offer to Purchase.
March 31, 1997
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<PAGE>
TABLE OF CONTENTS
PAGE
----
INTRODUCTION...................................................................1
1. Terms of the Offer; Proration; Expiration Date........................2
2. Acceptance for Payment and Payment for Shares.........................6
3. Procedures for Tendering Shares.......................................7
4. Withdrawal Rights.....................................................9
5. Certain Federal Income Tax Consequences..............................10
6. Price Range of Shares; Dividends.....................................10
7. Certain Information Concerning the Company...........................11
8. Certain Information Concerning Purchaser and Parent..................15
9. Source and Amount of Funds...........................................17
10. Background of the Offer; Contacts with the Company...................17
11. Purpose of the Offer; The Merger Offer; Proxy
Solicitation; Plans for the Company.................................18
12. Dividends and Distributions..........................................20
13. Conditions of the Offer..............................................20
14. Certain Legal Matters; Regulatory Approvals..........................24
15. Fees and Expenses....................................................27
16. Miscellaneous........................................................27
Schedule I -- Information Concerning the Directors and
Executive Officers of Parent and Purchaser................................29
Schedule II -- Information Concerning the Parent Nominees.....................32
Schedule III -- Transactions in the Securities of the Company.................33
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<PAGE>
TO THE HOLDERS OF COMMON STOCK OF DYNAMICS CORPORATION AMERICA:
INTRODUCTION
SB Acquisition Corp. (the "Purchaser") hereby offers to purchase up to
the Specified Percentage (as defined below) of shares of common stock, par value
$.10 per share (the "Shares") of Dynamics Corporation of America, a New York
corporation (the "Company"), including the associated Common Stock Purchase
Rights (the "Rights") issued pursuant to the Rights Agreement, dated as of
January 30, 1986, as amended on December 27, 1995, between the Company and First
National Bank of Boston, as Rights Agent (the "Rights Agent"), at a price of $40
per Share, net to the seller in cash, without interest thereon (the "Offer
Price"), upon the terms and subject to the conditions set forth in this Offer to
Purchase and in the related Letter of Transmittal (which, as amended from time
to time, together constitute the "Offer").
The Purchaser is a newly-formed New York corporation and a wholly-owned
subsidiary of WHX Corporation, a Delaware corporation ("Parent"). See Section 8.
The "Specified Percentage" shall initially mean that number of Shares
which, together with the Shares already owned by Purchaser or Parent, equals
19.9% of the outstanding Shares. In the event the Company amends the Rights
Agreement to reduce below 20% the ownership level at which a shareholder becomes
an Acquiring Person (as defined in the Rights Agreement), then the Specified
Percentage shall automatically be commensurately reduced. Such decrease in the
percentage of Shares sought to be purchased pursuant to the Offer shall not give
rise to any extension of the expiration, proration or withdrawal dates of the
Offer.
According to the Company's Proxy Statement dated March 26, 1997, as of
March 14, 1997 there were 3,815,194 Shares outstanding. Based on publicly
available information and after taking into account the 109,600 Shares
(approximately 2.9%) which the Purchaser already owns, the number of Shares to
be purchased in the Offer is currently 649,000.
Unless the context otherwise requires, all references to Shares shall
include the associated Rights, and all references to the Rights shall include
the benefits that may enure to holders of the Rights pursuant to the Rights
Agreement, including the right to receive any payment due upon redemption of the
Rights. The Rights are described in the Company Form 8-A (as defined in Section
7), and such description is summarized in Section 7. Based on publicly available
information, Purchaser believes that as of March 30, 1997, the Rights were not
exercisable, Rights certificates had not been issued and the Rights were
evidenced by the Share certificates. Purchaser believes that the commencement of
the Offer will not result in the declaration of a Distribution Date (as defined
in Section 7) under the Rights Agreement. See Section 7.
Tendering shareholders will not be obligated to pay brokerage fees or
commissions or, except as set forth in Instruction 6 of the Letter of
Transmittal, stock transfer taxes on the purchase of Shares by Purchaser
pursuant to the Offer. Purchaser will pay all charges and expenses of Harris
Trust Company of New York, as Depositary (the "Depositary"), and Georgeson &
Company Inc., as Information Agent (the "Information Agent"), incurred in
connection with the Offer. See Section 15.
On March 27, 1997, Parent sent a letter to the Company regarding a
proposed business combination between the Company and Parent at $40 per share
(the "Merger Proposal"). See Section 10. Parent has not received a response to
such letter and has decided to commence this Offer and to undertake the proxy
solicitation described below in furtherance of the Merger Proposal presented to
the Company.
In addition to commencing the Offer, Purchaser intends to solicit
proxies from the shareholders of the Company at the Annual Meeting of
Shareholders to be held on May 2, 1997 (the "Annual Meeting") to: (i) elect to
the Board of Directors four nominees of Purchaser (the "Purchaser Nominees")
listed on Schedule II of this Offer to Purchase which, if elected, would
constitute a majority of such Board of Directors, and (ii) adopt shareholder
by-laws which will permit holders of at least 9.9% of the Shares to call a
special meeting and permit the removal of directors at any time without cause
(the "By-law Amendments"). The Purchaser Nominees are committed to promptly
effect a merger of the Company with and into the Purchaser at a price of $40 per
Share in cash. If elected,
<PAGE>
the Purchaser Nominees intend to cause the Board to take appropriate steps to
allow Purchaser to acquire the entire equity interest in the Company by entering
into a merger agreement with Purchaser pursuant to which (i) Purchaser would
purchase the Shares pursuant to the Offer and (ii) the Merger (as defined below)
would be effected. Purchaser will furnish to shareholders a written proxy
statement at the earliest practicable date in accordance with application
regulations. Schedule II contains information concerning the Purchaser Nominees.
Purchaser has sent to the Company a demand for its shareholder list under New
York law.
In order to enable the Purchaser to vote Shares acquired in the Offer
at the Annual Meeting, Shares shall not be deemed to be duly or properly
tendered, and they will not be accepted for purchase by the Purchaser, unless
(i) they are tendered to the Purchaser by the Record Holders; or (ii) they are
tendered to the Purchaser by or on behalf of a shareholder who has obtained a
valid, irrevocable proxy to vote such Shares in connection with their purchase
directly from the Record Holder, or pursuant to a chain of purchasers from the
Record Holder whereby each successive purchaser through and including the
shareholder tendering Shares to the Purchaser has obtained a valid, irrevocable
proxy to vote such Shares in connection with the purchase of such Shares from
the prior owner of such Shares; or (iii) if tendered by a shareholder not
meeting the criteria of subparagraph (i) or (ii) immediately above, the Shares
tendered are accompanied by a proxy duly executed by the Record Holder in favor
of the shareholder tendering his Shares to the Purchaser. The form of proxy
recommended by the Purchaser to be obtained by the shareholder tendering his
Shares for purchase, in the event he does not meet the criterion set forth in
subparagraph (i) above, is set forth in Section 1.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) ANY APPLICABLE
WAITING PERIOD UNDER THE HSR ACT SHALL HAVE EXPIRED OR BEEN TERMINATED PRIOR TO
THE EXPIRATION OF THE OFFER, AND (2) THE COMPANY NOT HAVING ENTERED INTO OR
EFFECTUATED ANY AGREEMENTS WITH ANY PERSON OR ENTITY HAVING THE EFFECT OF
IMPAIRING PURCHASER'S ABILITY TO ACQUIRE THE COMPANY OR OTHERWISE DIMINISHING
THE EXPECTED ECONOMIC VALUE TO PURCHASER OF THE ACQUISITION OF THE COMPANY. SEE
SECTION 13. ALSO, TENDERS ARE SUBJECT TO THE SATISFACTION BY EACH TENDERING
SHAREHOLDER OF THE RECORD HOLDER CONDITION. SEE SECTION 1.
THIS OFFER TO PURCHASE AND THE LETTER OF TRANSMITTAL CONTAIN IMPORTANT
INFORMATION WHICH SHOULD BE READ CAREFULLY BEFORE ANY DECISION IS MADE WITH
RESPECT TO THE OFFER.
---------------------------
1. TERMS OF THE OFFER; PRORATION; EXPIRATION DATE.
Upon the terms and subject to the conditions of the Offer (including,
if the Offer is extended or amended, the terms and conditions of any extension
or amendment), Purchaser will accept for payment and pay for up to the Specified
Percentage of Shares which are validly tendered prior to the Expiration Date (as
hereinafter defined) and not properly withdrawn in accordance with Section 4.
The term "Expiration Date" means 12:00 Midnight, New York City time, on Tuesday,
April 29, 1997, unless and until Purchaser, in its sole discretion, shall have
extended the period of time during which the Offer is open, in which event the
term "Expiration Date" shall refer to the latest time and date at which the
Offer, as so extended by Purchaser, shall expire.
Shares shall not be deemed to be duly or properly tendered, and they
will not be accepted for purchase by the Purchaser, unless (i) they are tendered
to the Purchaser by the Record Holders; or (ii) they are tendered to the
Purchaser by or on behalf of a shareholder who has obtained a valid, irrevocable
proxy to vote such Shares in connection with their purchase directly from the
Record Holder, or pursuant to a chain of purchasers from the Record Holder
whereby each successive purchaser through and including the shareholder
tendering Shares to the Purchaser has obtained a valid, irrevocable proxy to
vote such Shares in connection with the purchase of such Shares from the prior
owner of such Shares; or (iii) if tendered by a shareholder not meeting the
criteria of subparagraph (i) or (ii) immediately above, the Shares tendered are
accompanied by a proxy duly executed by the Record Holder in favor of the
shareholder tendering his Shares to the Purchaser. As used in this paragraph and
elsewhere herein where the
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<PAGE>
context requires, the term proxy includes a substitution as a proxy. The
requirements stated in clauses (i) - (iii) above are referred to as the "Record
Holder Condition."
The purpose of the foregoing requirements is to ensure that the
Purchaser will be able to vote the Shares it accepts for purchase at the Annual
Meeting. All persons who execute the Letter of Transmittal will thereby execute
a proxy in favor of the Purchaser with respect to Shares accepted for purchase
by the Purchaser. Because certain tendering shareholders will not be Record
Holders, it is necessary to obtain proxies or a chain of proxies from the Record
Holders; hence the requirements of clauses (ii) and (iii) of the preceding
paragraph.
The terms of the proxies referred to above are not imposed by the
Purchaser except that such proxy or proxies must provide the Purchaser
assurances that the Purchaser vote any Shares which it purchases, the proxy must
be dated and the proxy must be duly executed in accordance with rules usually
relating to proxies and the proxy should also contain the address and telephone
number of the person executing the proxy. Set forth below are two forms of proxy
which will be acceptable to the Purchaser. Other forms may be used, except that
the requirements set forth above must be satisfied.
If the proxy is one described in clause (ii) of the first paragraph of
this Section 1, the following form will be acceptable to the Purchaser:
The undersigned hereby irrevocably appoints
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[the person to whom the Shares are sold by the undersigned]
and the designees thereof the attorneys and proxies of the undersigned,
with full power of substitution, to vote in such manner as each such
attorney and proxy or his substitute shall in his sole discretion deem
proper, and otherwise to act with respect to, _______ shares of the
Common Stock (the "Shares") of Dynamics Corporation of America. This
proxy is irrevocable (except to the extent that irrevocably is not
permitted pursuant to applicable law), is granted in consideration of
the purchase of some or all of the Shares and shall revoke any other
proxy granted by the undersigned at any time with respect to the Shares
and any such securities, and no subsequent proxies will be granted with
respect thereto by the undersigned.
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Date Name
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Signature
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Address
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Telephone
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If the proxy is one described in clause (iii) of the first paragraph of
this Section 1, the following form will be acceptable to the Purchaser:
The undersigned hereby irrevocably appoints
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[insert the name of the tendering shareholder exactly as it appears in
the Letter of Transmittal]
as a proxy to vote Shares of common stock of Dynamics Corporation of
America which the undersigned owned of record as of March 14, 1997 but
has sold. The person designated as proxy has full power of substitution
and may appoint any other person or persons as proxy to vote such
shares. In particular, the person named as proxy may substitute Messrs.
Ronald LaBow or Stewart E. Tabin as proxy with respect to any Shares
which may be purchased pursuant to a tender offer by SB Acquisition
Corp., a wholly-owned subsidiary of WHX Corporation dated March 31,
1997.
--------------------------------------- -------------------------
Date Name
----------------------------
Signature
----------------------------
Address
----------------------------
Telephone
The Purchaser will have the power to vote only those Shares which it
accepts for purchase. The Offer is scheduled to terminate on Tuesday, April 29,
1997. Promptly thereafter, the Purchaser will notify the tendering shareholder
as to the number of shares out of the total number of shares tendered by the
shareholders which the Purchaser has accepted for purchase and which the
Purchaser will vote. The notice will indicate that the tendering shareholder has
the right to vote any Shares which have not been accepted for purchase.
The Letter of Transmittal contains a box entitled "Record Ownership as
of March 14, 1997." One of the three statements in that box must be checked, and
the statement so specified must be accurate and correct in order for Shares to
be duly and properly tendered.
The Purchaser has been informally advised by the Staff of the
Securities and Exchange Commission (the "SEC") that the Record Holder Condition
is not permissible under Rule 14d-10(a)(1) under the Securities Exchange Act of
1934, as amended (the "Exchange Act"). The Purchaser does not concur with that
position, due to the special circumstances of the timing of the Offer in
relation to the Annual Meeting and the Purchaser's intention to complete the
Merger, in which all shareholders will receive the same consideration paid to
shareholders who satisfy the Record Holder Condition. The Purchaser reserves the
right to waive the Record Holder Condition, in its sole discretion.
If more than the Specified Percentage are validly tendered prior to the
Expiration Date and not properly withdrawn, Purchaser will, upon the terms and
subject to the conditions of the Offer, accept for payment and pay for only the
Specified Percentage, on a pro rata basis, with adjustments to avoid purchases
of fractional Shares, based upon the number of Shares validly tendered prior to
the Expiration Date and not properly withdrawn. Currently, after giving effect
to the 109,600 Shares already owned by the Purchaser, the Specified Percentage
is 19.9%, or up to 649,000 Shares. Purchaser expressly reserves the right, in
its sole discretion, at any time or from time to time, to increase or decrease
the number of Shares being purchased pursuant to the Offer and, if Purchaser in
its discretion determines to so increase or decrease such number of Shares and
if such action is required under the rules of the SEC, Purchaser will extend the
Offer. The Purchaser does not believe that the automatic adjustment of the
Specified Percentage will give rise to an extension of the expiration, proration
or withdrawal dates of the Offer under Rule
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14e-1(b) of the Exchange Act. The Purchaser has been informally advised by the
Staff of the SEC that it does not take any position on this issue.
Because of the difficulty of determining precisely the number of Shares
validly tendered and not withdrawn, if proration is required, Purchaser would
not expect to be able to announce the final results of proration or pay for
Shares until at least five New York Stock Exchange, Inc. ("NYSE") trading days
after the Expiration Date. Preliminary results of proration will be announced by
press release as promptly as practicable after the Expiration Date. Holders of
Shares may obtain such preliminary information from the Information Agent and
may also be able to obtain such preliminary information from their brokers.
Subject to the applicable regulations of the SEC, Purchaser also
expressly reserves the right, in its sole discretion, at any time or from time
to time, to (i) decline to purchase any of the Shares tendered in the Offer and
terminate the Offer, and return all tendered Shares to the tendering
shareholders, (ii) waive or amend any or all conditions to the Offer to the
extent permitted by applicable law and, subject to complying with applicable
rules and regulations of the SEC, purchase all Shares validly tendered, or (iii)
extend the Offer and, subject to the right of shareholders to withdraw Shares
until the Expiration Date, retain the Shares which have been tendered during the
period or periods for which the Offer is extended.
Purchaser expressly reserves the right, in its sole discretion, at any
time and from time to time, to extend for any reason the period of time during
which the Offer is open, including the occurrence of any of the conditions
specified in Section 13, by giving oral or written notice of such extension to
the Depositary. During any such extension, all Shares previously tendered and
not properly withdrawn will remain subject to the Offer, subject to the rights
of a tendering shareholder to withdraw its Shares in accordance with the
procedures set forth in Section 4.
Subject to the applicable regulations of the SEC, Purchaser also
expressly reserves the right, in its sole discretion, at any time and from time
to time, (i) to delay acceptance for payment of, or, regardless of whether such
Shares were theretofore accepted for payment, payment for, any Shares in order
to comply in whole or in part with any applicable law and (ii) to waive any
condition or otherwise amend the Offer in any respect by giving oral or written
notice of such delay, waiver or amendment to the Depositary and by making a
public announcement thereof.
Purchaser acknowledges that (i) Rule 14e-1(c) under the Exchange Act
requires Purchaser to pay the consideration offered or return the Shares
tendered promptly after the termination or withdrawal of the Offer, and (ii)
Purchaser may not delay acceptance for payment of, or payment for (except as
provided in clause (i) of the first sentence of the second preceding paragraph),
any Shares upon the occurrence of any of the conditions specified in Section 13
without extending the period of time during which the Offer is open.
Any such extension, delay, termination, waiver or amendment will be
followed as promptly as practicable by public announcement thereof, with such
announcement in the case of an extension to be made no later than 9:00 a.m., New
York City time, on the next business day after the previously scheduled
Expiration Date. Subject to applicable law (including Rules 14d-4(c), 14d-6(d)
and 14e-1 under the Exchange Act, which require that material changes be
promptly disseminated to shareholders in a manner reasonably designed to inform
them of such changes) and without limiting the manner in which Purchaser may
choose to make any public announcement, Purchaser shall have no obligation to
publish, advertise or otherwise communicate any such public announcement other
than by issuing a press release to the Dow Jones News Service.
If Purchaser makes a material change in the terms of the Offer or the
information concerning the Offer, or if it waives a material condition of the
Offer, Purchaser will disseminate additional tender offer materials and extend
the Offer to the extent required by Rules 14d-4(c), 14d-6(d) and 14e-1 under the
Exchange Act. The minimum period during which the Offer must remain open
following material changes in the terms of the Offer or information concerning
the Offer, other than a change in price or a change in percentage of securities
sought, will depend upon the facts and circumstances, including the relative
materiality of the changed terms or information. In the SEC's view, an offer
should generally remain open for a minimum of five business days from the date a
material change is first published, sent or given to shareholders. With respect
to a change in price or a change in percentage of securities sought (other than
an increase in the number of Shares sought not in excess of 2% of the
outstanding Shares), a minimum ten business day period is required to allow for
adequate dissemination to shareholders and
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<PAGE>
investor response. As used in this Offer to Purchase, "business day" has the
meaning set forth in Rule 14d-1 under the Exchange Act. Accordingly, if, prior
to the Expiration Date, Purchaser increases or decreases the number of Shares
being sought (except for a change in the Specified Percentage), or increases or
decreases the consideration offered pursuant to the Offer, and if the Offer is
scheduled to expire at any time earlier than the period ending on the tenth
business day from the date that notice of such increase or decrease is first
published, sent or given to holders of Shares, the Offer will be extended at
least until the expiration of such ten business day period.
As of the date of this Offer to Purchase, the Rights are evidenced by
the certificates representing Shares and do not trade separately. Accordingly,
by tendering a certificate representing Shares, a shareholder is automatically
tendering a similar number of associated Rights. If, however, pursuant to the
Rights Agreement or for any other reason, the Rights detach and separate
certificates representing rights ("Rights Certificates") are issued,
shareholders will be required to tender one Right for each Share tendered in
order to effect a valid tender of such Share.
2. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES.
Upon the terms and subject to the conditions of the Offer (including,
if the Offer is extended or amended, the terms and conditions of any such
extension or amendment), Purchaser will purchase, by accepting for payment, and
will pay for, the Specified Percentage which are validly tendered prior to the
Expiration Date (and not properly withdrawn in accordance with Section 4)
promptly after the later to occur of (i) the Expiration Date and (ii) the
satisfaction or waiver of the conditions set forth in Section 13. Purchaser
expressly reserves the right, in its discretion, to delay acceptance for payment
of, or, subject to applicable rules of the SEC, payment for, Shares in order to
comply in whole or in part with any applicable law.
In all cases, payment for Shares purchased pursuant to the Offer will
be made only after timely receipt by the Depositary of (i) the certificates
evidencing such Shares (the "Share Certificates") or timely confirmation of a
book-entry transfer (a "Book-Entry Confirmation") of such Shares, if such
procedure is available, into the Depositary's account at The Depository Trust
Company or the Philadelphia Depository Trust Company (each a "Book-Entry
Transfer Facility" and, collectively, the "Book-Entry Transfer Facilities")
pursuant to the procedures set forth in Section 3, (ii) the Letter of
Transmittal (or facsimile thereof), properly completed and duly executed, or, in
the case of a book-entry transfer, an Agent's Message (as defined below) and
(iii) any other documents required by the Letter of Transmittal. See Section 3.
The term "Agent's Message" means a message, transmitted by a Book-Entry
Transfer Facility to, and received by, the Depositary and forming a part of a
Book-Entry Confirmation, which states that such Book-Entry Transfer Facility has
received an express acknowledgment from the participant in such Book-Entry
Transfer Facility tendering the Shares, that such participant has received and
agrees to be bound by the terms of the Letter of Transmittal and that Purchaser
may enforce such agreement against the participant.
For purposes of the Offer, Purchaser will be deemed to have accepted
for payment, and thereby purchased, Shares validly tendered and not properly
withdrawn if, as and when Purchaser gives oral or written notice to the
Depositary of Purchaser's acceptance of such Shares for payment. Payment for
Shares accepted pursuant to the Offer will be made by deposit of the purchase
price therefor with the Depositary, which will act as agent for tendering
shareholders for the purpose of receiving payments from Purchaser and
transmitting payments to such tendering shareholders. Under no circumstances
will interest on the purchase price for Shares be paid by Purchaser, regardless
of any delay in making such payment. Upon the deposit of funds with the
Depositary for the purpose of making payments to tendering shareholders,
Purchaser's obligation to make such payment shall be satisfied and tendering
shareholders must thereafter look solely to the Depositary for payment of
amounts owed to them by reason of the acceptance for payment of Shares pursuant
to the Offer. Purchaser will pay any stock transfer taxes incident to the
transfer to it of validly tendered Shares, except as otherwise provided in
Instruction 6 of the Letter of Transmittal, as well as any charges and expenses
of the Depositary and the Information Agent.
If any tendered Shares are not accepted for payment for any reason
pursuant to the terms and conditions of the Offer, or if Share Certificates are
submitted evidencing more Shares than are tendered, Share Certificates
evidencing Shares not purchased will be returned, without expense to the
tendering shareholder (or, in the case of Shares tendered by book-entry transfer
into the Depositary's account at a Book-Entry Transfer Facility pursuant to
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<PAGE>
the procedure set forth in Section 3, such Shares will be credited to an account
maintained at such Book-Entry Transfer Facility), as promptly as practicable
following the expiration or termination of the Offer.
If, prior to the Expiration Date, Purchaser increases the consideration
to be paid per Share pursuant to the Offer, Purchaser will pay such increased
consideration for all such Shares purchased pursuant to the Offer, whether or
not such Shares were tendered prior to such increase in consideration.
Purchaser reserves the right to transfer or assign, in whole at any
time, or in part from time to time, to Parent or one or more direct or indirect
wholly owned subsidiaries of Parent, the right to purchase all or any portion of
the Shares tendered pursuant to the Offer, provided that any such transfer or
assignment will not relieve Purchaser of its obligations under the Offer and
will in no way prejudice the rights of tendering shareholders to receive payment
for Shares validly tendered and accepted for payment pursuant to the Offer.
3. PROCEDURES FOR TENDERING SHARES.
VALID TENDER OF SHARES. In order for Shares to be validly tendered
pursuant to the Offer, the Letter of Transmittal (or facsimile thereof),
properly completed and duly executed, with any required signature guarantees, or
an Agent's Message (in the case of any book-entry transfer), a proxy or proxies,
in the form recommended in Section 1 if the tendering shareholder was not the
Record Holder and any other required documents, must be received by the
Depositary at one of its addresses set forth on the back cover of this Offer to
Purchase prior to the Expiration Date and either (i) the Share Certificates
evidencing tendered Shares must be received by the Depositary at one of such
addresses or Shares must be tendered pursuant to the procedure for book-entry
transfer described below and a Book-Entry Confirmation must be received by the
Depositary, in each case prior to the Expiration Date, or (ii) the tendering
shareholder must comply with the guaranteed delivery procedures described below.
THE METHOD OF DELIVERY OF SHARE CERTIFICATES AND ALL OTHER REQUIRED
DOCUMENTS, INCLUDING DELIVERY THROUGH A BOOK-ENTRY TRANSFER FACILITY, IS AT THE
OPTION AND RISK OF THE TENDERING SHAREHOLDER, AND THE DELIVERY WILL BE DEEMED
MADE ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY. IF DELIVERY IS BY MAIL,
REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED.
IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
BOOK-ENTRY TRANSFER. The Depositary will establish an account with
respect to the Shares at each of the Book-Entry Transfer Facilities for purposes
of the Offer within two business days after the date of this Offer to Purchase,
and any financial institution that is a participant in either of the Book-Entry
Transfer Facilities' system may make book-entry delivery of Shares by causing
the Book-Entry Transfer Facility to transfer such Shares into the Depositary's
account at a Book-Entry Transfer Facility in accordance with such Book-Entry
Transfer Facility's procedures for transfer. However, although delivery of
Shares may be effected through book-entry transfer at the Book-Entry Transfer
Facility, the Letter of Transmittal (or facsimile thereof), properly completed
and duly executed, with any required signature guarantees, a proxy in the form
recommended in Section 1, if required in order to satisfy the Record Holder
Condition, and any other required documents must, in any case, be transmitted to
and received by the Depositary at one of its addresses set forth on the back
cover of this Offer to Purchase prior to the Expiration Date or the tendering
shareholder must comply with the guaranteed delivery procedures described below.
The confirmation of a book-entry transfer of shares into the Depositary's
account at a Book Entry Transfer Facility as described above is referred to as a
"Book-Entry Confirmation." DELIVERY OF DOCUMENTS TO A BOOK-ENTRY TRANSFER
FACILITY IN ACCORDANCE WITH SUCH BOOK-ENTRY TRANSFER FACILITY'S PROCEDURES DOES
NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
SIGNATURE GUARANTEE. Signatures on all Letters of Transmittal must be
guaranteed by a firm which is a bank, broker, dealer, credit union, savings
association or other entity that is a member in good standing of the Securities
Transfer Agents Medallion Program (each, an "Eligible Institution"), unless the
Shares tendered thereby are tendered (i) by a registered holder of Shares who
has not completed either the box entitled "Special Delivery Instructions" or the
box entitled "Special Payment Instructions" on the Letter of Transmittal or (ii)
for the account of an Eligible Institution. See Instruction 1 of the Letter of
Transmittal.
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If a Share Certificate is registered in the name of a person other than
the signer of the Letter of Transmittal, or if payment is to be made, or a Share
Certificate not accepted for payment or not tendered is to be returned, to a
person other than the registered holder(s), then the Share Certificate must be
endorsed or accompanied by appropriate stock powers, in either case signed
exactly as the name(s) of the registered holder(s) appear on the Share
Certificate, with the signature(s) on such Share Certificate or stock powers
guaranteed as described above. See Instructions 1 and 5 of the Letter of
Transmittal.
GUARANTEED DELIVERY. If a shareholder desires to tender Shares pursuant
to the Offer and such shareholder's Share Certificates are not immediately
available or time will not permit all required documents to reach the Depositary
prior to the Expiration Date or the procedure for book-entry transfer cannot be
completed on a timely basis, such Shares may nevertheless be tendered if all the
following conditions are satisfied:
(i) the tender is made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of
Guaranteed Delivery, substantially in the form provided by Purchaser
herewith, is received by the Depositary as provided below prior to the
Expiration Date; and
(iii) in the case of a guarantee of Shares, the Share
Certificates for all tendered Shares, in proper form for transfer, or a
Book-Entry Confirmation, together with a properly completed and duly
executed Letter of Transmittal (or manually signed facsimile thereof)
with any required signature guarantee (or, in the case of a book-entry
transfer, an Agent's Message) and any other documents required by such
Letter of Transmittal, are received by the Depositary within three NYSE
trading days after the date of execution of the Notice of Guaranteed
Delivery.
Any Notice of Guaranteed Delivery may be delivered by hand or
transmitted by telegram, facsimile transmission or mail to the Depositary and
must include a guarantee by an Eligible Institution in the form set forth in the
Notice of Guaranteed Delivery.
IN ALL CASES, SHARES SHALL NOT BE DEEMED VALIDLY TENDERED, UNLESS A
PROPERLY COMPLETED AND DULY EXECUTED LETTER OF TRANSMITTAL (OR A MANUALLY SIGNED
FACSIMILE) IS RECEIVED BY THE DEPOSITARY.
Notwithstanding any other provision hereof, payment for Shares
purchased pursuant to the Offer will, in all cases, be made only after timely
receipt by the Depositary of (i) the Share Certificates evidencing such Shares,
or a Book-Entry Confirmation of the delivery of such Shares, if available, (ii)
a properly completed and duly executed Letter of Transmittal (or manually signed
facsimile thereof) and (iii) any other documents required by the Letter of
Transmittal (including those necessary to satisfy the Record Holder Condition).
DISTRIBUTION OF RIGHTS. Holders of Shares will be required to tender
one Right for each Share tendered to effect a valid tender of such Share. Unless
and until the Distribution Date (as defined in Section 7 below) occurs, the
Rights are represented by and transferred with the Shares. Accordingly, if the
Distribution Date does not occur prior to the Expiration Date of the Offer, a
tender of Shares will constitute a tender of the associated Rights. If a
Distribution Date has occurred, certificates representing a number of Rights
equal to the number of Shares being tendered must be delivered to the Depositary
in order for such Shares to be validly tendered. If a Distribution Date has
occurred, a tender of Shares without Rights constitutes an agreement by the
tendering shareholder to deliver certificates representing a number of Rights
equal to the number of Shares tendered pursuant to the Offer to the Depositary
within three NYSE trading days after the date such certificates are distributed.
Purchaser reserves the right to require that it receive such certificates prior
to accepting Shares for payment. If a Distribution Date has occurred, unless the
Rights are redeemed prior to the Expiration Date, shareholders who sell their
rights separately from their Shares and do not otherwise acquire Rights may not
be able to satisfy the requirements of the Offer for the tender of Shares.
Payment for Shares tendered and purchased pursuant to the Offer will be made
only after timely receipt by the Depositary of, among other things, such
certificates, if such certificates have been distributed to holders of Shares.
Purchaser will not pay any additional consideration for the Rights tendered
pursuant to the Offer.
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DETERMINATION OF VALIDITY. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance for payment of any
tendered Shares pursuant to any of the procedures described above will be
determined by Purchaser in its sole discretion, whose determination will be
final and binding on all parties. Purchaser reserves the absolute right to
reject any or all tenders of any Shares determined by it not to be in proper
form or if the acceptance for payment of, or payment for, such Shares may, in
the opinion of Purchaser's counsel, be unlawful. Purchaser also reserves the
absolute right, in its sole discretion, to waive any of the conditions of the
Offer or any defect or irregularity in any tender with respect to Shares of any
particular shareholder, whether or not similar defects or irregularities are
waived in the case of other shareholders. No tender of Shares will be deemed to
have been validly made until all defects and irregularities have been cured or
waived.
Purchaser's interpretation of the terms and conditions of the Offer
(including the Letter of Transmittal and the instructions thereto) will be final
and binding. None of Parent, Purchaser, the Company, the Depositary, the
Information Agent or any other person will be under any duty to give
notification of any defects or irregularities in tenders or will incur any
liability for failure to give any such notification.
APPOINTMENT AS PROXY. By executing a Letter of Transmittal as set forth
above, a tendering shareholder irrevocably appoints designees of Purchaser as
such shareholder's proxies, each with full power of substitution, to the full
extent of such shareholder's rights with respect to the Shares tendered by such
shareholder and accepted for payment by Purchaser (and any and all noncash
dividends, distributions, rights, other Shares, or other securities issued or
issuable in respect of such Shares after March 14, 1997). All such proxies shall
be considered coupled with an interest in the tendered Shares. This appointment
will be effective if, when, and only to the extent that, Purchaser accepts such
Shares for payment pursuant to the Offer. Upon such acceptance for payment, all
prior proxies given by such shareholder with respect to such Shares and other
securities will, without further action, be revoked, and no subsequent proxies
may be given. The designees of Purchaser will, with respect to the Shares and
other securities for which the appointment is effective, be empowered to
exercise all voting and other rights of such shareholder as they in their sole
discretion may deem proper at any annual, special, adjourned or postponed
meeting of the Company's shareholders, including the Annual Meeting scheduled
for May 2, 1997, by written consent or otherwise, and Purchaser reserves the
right to require that, in order for Shares or other securities to be deemed
validly tendered, immediately upon Purchaser's acceptance for payment of such
Shares, Purchaser must be able to exercise full voting rights with respect to
such Shares.
TO PREVENT BACKUP FEDERAL INCOME TAX WITHHOLDING WITH RESPECT TO
PAYMENT TO CERTAIN SHAREHOLDERS OF THE PURCHASE PRICE FOR SHARES PURCHASED
PURSUANT TO THE OFFER, EACH SUCH SHAREHOLDER MUST PROVIDE THE DEPOSITARY WITH
SUCH SHAREHOLDER'S CORRECT TAXPAYER IDENTIFICATION NUMBER AND CERTIFY THAT SUCH
SHAREHOLDER IS NOT SUBJECT TO BACKUP FEDERAL INCOME TAX WITHHOLDING BY
COMPLETING THE SUBSTITUTE FORM W-9 IN THE LETTER OF TRANSMITTAL. IF BACKUP
WITHHOLDING APPLIES WITH RESPECT TO A SHAREHOLDER, THE DEPOSITARY IS REQUIRED TO
WITHHOLD 31% OF ANY PAYMENTS MADE TO SUCH SHAREHOLDER. SEE INSTRUCTION 9 OF THE
LETTER OF TRANSMITTAL.
Purchaser's acceptance for payment of Shares tendered pursuant to the
Offer will constitute a binding agreement between the tendering shareholder and
Purchaser upon the terms and subject to the conditions of the Offer.
4. WITHDRAWAL RIGHTS.
Tenders of Shares made pursuant to the Offer are irrevocable except
that such Shares may be withdrawn at any time prior to the Expiration Date and,
unless theretofore accepted for payment by Purchaser pursuant to the Offer, may
also be withdrawn at any time after May 28, 1997.
If Purchaser extends the Offer, is delayed in its acceptance for
payment of Shares or is unable to accept Shares for payment pursuant to the
Offer for any reason, then, without prejudice to Purchaser's rights under the
Offer, the Depositary may, nevertheless, on behalf of Purchaser, retain tendered
Shares, and such Shares may not
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be withdrawn except to the extent that tendering shareholders are entitled to
withdrawal rights as described in this Section 4. Any such delay will be by an
extension of the Offer to the extent required by law.
For a withdrawal to be effective, a written, telegraphic or facsimile
transmission notice of withdrawal must be timely received by the Depositary at
one of its addresses set forth on the back cover of this Offer to Purchase. Any
such notice of withdrawal must specify the name of the person who tendered the
Shares to be withdrawn, the number of Shares to be withdrawn and the name of the
registered holder, if different from that of the person who tendered such
Shares. If Share Certificates evidencing Shares to be withdrawn have been
delivered or otherwise identified to the Depositary, then, prior to the physical
release of such Share Certificates, the serial numbers shown on such Share
Certificates must be submitted to the Depositary and the signature(s) on the
notice of withdrawal must be guaranteed by an Eligible Institution, unless such
Shares have been tendered for the account of an Eligible Institution. If Shares
have been tendered pursuant to the procedure for book-entry transfer as set
forth in Section 3, any notice of withdrawal must also specify the name and
number of the account at a Book-Entry Transfer Facility to be credited with the
withdrawn Shares.
All questions as to the form and validity (including time of receipt)
of notices of withdrawal will be determined by Purchaser, in its sole
discretion, whose determination will be final and binding. None of Parent,
Purchaser, the Company, the Depositary, the Information Agent or any other
person will be under any duty to give notification of any defects or
irregularities in any notice of withdrawal or incur any liability for failure to
give any such notification.
Any Shares properly withdrawn will thereafter be deemed not to have
been validly tendered for purposes of the Offer. However, withdrawn Shares may
be retendered at any time prior to the Expiration Date by following the
procedures described in Section 3.
5. CERTAIN FEDERAL INCOME TAX CONSEQUENCES.
The sale of Shares pursuant to the Offer will be a taxable transaction
for federal income tax purposes under the Internal Revenue Code of 1986, as
amended (the "Code"), and will likely be a taxable transaction under applicable
state, local, foreign and other tax laws as well. Generally, for federal income
tax purposes, a tendering shareholder will recognize gain or loss equal to the
difference, if any, between the amount of cash received by the shareholder
pursuant to the Offer and the aggregate tax basis in the Shares tendered by the
shareholder and purchased pursuant to the Offer. Gain or loss will be computed
separately for each block of Shares (i.e., Shares acquired at the same time and
price) tendered and purchased pursuant to the Offer.
If Shares are held by a shareholder as a capital asset, gain or loss
recognized by the shareholder will be capital gain or loss, which will be
long-term capital gain or loss if such shareholder's holding period for the
Shares exceeds one year. Under present law, long-term capital gains recognized
by an individual shareholder generally will be taxed at a maximum federal
marginal tax rate of 28%, and long-term capital gains recognized by a corporate
shareholder will be taxed at a maximum federal marginal tax rate of 35%.
THE FOREGOING DISCUSSION IS INCLUDED FOR GENERAL INFORMATION ONLY AND
MAY NOT BE APPLICABLE WITH RESPECT TO SHARES RECEIVED PURSUANT TO THE EXERCISE
OF EMPLOYEE STOCK OPTIONS OR OTHERWISE AS COMPENSATION OR WITH RESPECT TO
HOLDERS OF SHARES WHO ARE SUBJECT TO SPECIAL TAX TREATMENT UNDER THE CODE, SUCH
AS NON-U.S. PERSONS, LIFE INSURANCE COMPANIES, TAX-EXEMPT ORGANIZATIONS AND
FINANCIAL INSTITUTIONS, AND MAY NOT APPLY TO A HOLDER OF SHARES IN LIGHT OF
INDIVIDUAL CIRCUMSTANCES. SHAREHOLDERS ARE URGED TO CONSULT THEIR TAX ADVISORS
TO DETERMINE THE PARTICULAR TAX CONSEQUENCES TO THEM (INCLUDING THE APPLICATION
AND EFFECT OF ANY STATE, LOCAL OR OTHER TAX CONSEQUENCES) OF THE OFFER AND THE
MERGER.
6. PRICE RANGE OF SHARES; DIVIDENDS.
According to the Company's Form 10-K for the year ended December 31,
1996 (the "Company Form 10-K") and other publicly-available information, the
Shares are listed and principally traded on the NYSE. The
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following table sets forth, for the quarters indicated, the high and low sales
prices per Share on the NYSE and the amount of cash dividends paid per Share, as
reported in the Company Form 10-K for periods in 1995 and 1996 and as reported
by published financial sources with respect to periods in 1997:
<TABLE>
<CAPTION>
CASH
HIGH LOW DIVIDENDS
---- --- ---------
<S> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1995:
First Quarter ............................................ 26 3/4 19 1/2 .10
Second Quarter ........................................... 24 3/4 22 1/4 -0-
Third Quarter ............................................ 24 5/8 22 1/2 .10
Fourth Quarter ........................................... 25 7/8 21 5/8 -0-
YEAR ENDED DECEMBER 31, 1996:
First Quarter ............................................ 24 7/8 22 1/8 .10
Second Quarter ........................................... 27 7/8 23 1/4 -0-
Third Quarter ............................................ 29 1/8 25 .10
Fourth Quarter ........................................... 29 1/4 27 7/8 -0-
YEAR ENDED DECEMBER 31, 1997:
First Quarter (through March 27, 1997) ................... 33 1/4 26 1/2 .10
</TABLE>
On March 27, 1997, the last trading day prior to the commencement date
of the Offer, the reported closing sales price of the Common Shares on the NYSE
Composite Tape was $331/8 per Share. SHAREHOLDERS ARE URGED TO OBTAIN A CURRENT
MARKET QUOTATION FOR THE SHARES.
7. CERTAIN INFORMATION CONCERNING THE COMPANY.
Except as otherwise noted below, the information concerning the Company
contained in this Offer to Purchase, including financial information, has been
taken from or based upon publicly available documents and records on file with
the SEC and other public sources. Neither Parent nor Purchaser assumes any
responsibility for the accuracy or completeness of the information concerning
the Company contained in such documents and records or for any failure by the
Company to disclose events which may have occurred or may affect the
significance or accuracy of any such information but which are unknown to Parent
or Purchaser.
The Company is a New York corporation whose principal executive offices
are located at 475 Steamboat Road, Greenwich, Connecticut 06830-7197. The
Company is a diversified manufacturer of commercial and industrial products
founded in 1924. The Company's seven plants are located in California,
Connecticut, Ohio and Pennsylvania. Its five separate business units manufacture
electronic components such as heat dissipators and Zero Insertion force
(ZIF(tm)) printed circuit board retainers, frequency control components and
oscillators; commercial and consumer appliances sold under the Waring(R), Acme
Juicerator(R), Qualheim(tm), Blendor(R), NuBlend(R) and Touchblend(tm)
tradenames; air distribution products and systems sold under the Anemostat(R),
Anemotrak(R) and Envirotrak(R) tradenames; vision frames and louvers for fire
rated doors; and air conditioning and related equipment for power plant and
other applications, and mobile vans and transportable shelters (including the
Environ(R)) for specialized electronic and medical diagnostic equipment such as
CT and MRI scanners.
The Company also invests from time to time in shares of other
businesses. The Company currently holds a 44.1% stake in CTS Corporation
("CTS"), an Indiana corporation whose principal executive offices are located at
905 West Boulevard North, Elkhart, Indiana 46514. CTS was incorporated in 1929
as a successor to a company founded in 1896 and its shares are listed on the New
York Stock Exchange (trading symbol: CTS). CTS develops, manufacturers and sells
electronic and electromechanical components and subsystems for the automotive,
communications equipment, data processing, defense and aerospace, instruments
and controls and consumer electronic
-11-
<PAGE>
markets. As described in Parent's letter to the Company dated March 27, 1997,
Parent has no interest in increasing the equity stake which the Company holds in
CTS, or in changing the nature of the current relationship between the two
companies. See Section 10.
FINANCIAL INFORMATION ON THE COMPANY. Set forth below is a summary of
certain consolidated financial information with respect to the Company and its
subsidiaries for its fiscal years ended December 31, 1996, 1995 and 1994,
excerpted from financial statements presented in the Company Form 10-K and other
documents filed by the Company with the SEC. More comprehensive financial
information is included in such reports (including management's discussion and
analysis of results of operations and financial position) and other documents
filed by the Company with the SEC, and the financial information summary set
forth below is qualified in its entirety by reference to such reports and other
documents, which are incorporated herein by reference, and all the financial
information and related notes contained therein. The Company Form 10-K and such
other documents may be examined and copies may be obtained from the officers of
the SEC or the NYSE in the manner set forth below.
DYNAMICS CORPORATION OF AMERICA
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Year Ended December 31,
------------------------------------------------
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
INCOME STATEMENT DATA:
Net Sales ................................................ $ 129,206 $ 114,164 $107,700
Income (loss) from continuing operations before equity
investment in CTS ............................... 76 1,364 5,106
Income from equity investment in CTS ..................... 10,280 4,411 3,618
Income from continuing operations ........................ 10,356 5,775 8,724
INCOME PER COMMON SHARE INFORMATION:
Continuing Operations ........................... 2.71 1.50 2.25
Reclassification of provision for
Fermont disposition ............................. .07 .25 --
Net income ...................................... 2.78 1.75 2.25
Dividends per common share ...................... .20 .20 .20
</TABLE>
<TABLE>
<CAPTION>
At December 31,
-----------------------------------
1996 1995
---- ----
<S> <C> <C>
BALANCE SHEET DATA:
Total Current Assets...................... $49,350 $50,793
Equity Investment in CTS.................. 84,046 77,180
Total Assets.............................. 140,736 134,301
Total Liabilities......................... 25,698 28,827
Total Shareholders' Equity................ 115,038 105,474
</TABLE>
FINANCIAL INFORMATION ON CTS. Set forth below is a summary of certain
consolidated financial information with respect to CTS and its subsidiaries for
its fiscal years ended December 31, 1996, 1995 and 1994, excerpted from
financial statements presented in CTS' Annual Report on Form 10-K for the year
ended December 31, 1996 (the "CTS Form 10-K") and other documents filed by CTS
with the SEC. More comprehensive financial information is included in such
reports (including management's discussion and analysis of results of operations
and financial position) and other documents filed by CTS with the SEC, and the
financial information summary set forth below is qualified in its entirety by
reference to such reports and other documents, which are incorporated herein by
reference, and all the financial information and related notes contained
therein. The CTS Form 10-K and such other documents may be examined and copies
may be obtained from the officers of the SEC or the NYSE in the manner set forth
below.
-12-
<PAGE>
CTS CORPORATION
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Year Ended December 31,
--------------------------------------
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
INCOME STATEMENT DATA:
Net Sales ............................................ $321,297 $300,157 $268,707
Earnings before Taxes ................................ 33,602 27,684 21,487
Net Earnings ......................................... 21,170 17,164 13,967
INCOME PER COMMON SHARE INFORMATION:
Net Earnings Applicable to Common Stock ..... $ 4.03 $ 3.30 $ 2.70
Dividends declared .......................... .69 .60 .45
</TABLE>
<TABLE>
<CAPTION>
At December 31,
-----------------------
1996 1995
---- ----
<S> <C> <C>
BALANCE SHEET DATA:
Total Current Assets ........................... $138,201 $126,113
Net Property, Plant and Equipment .............. 56,103 50,696
Total Assets ................................... 249,372 227,127
Total Liabilities .............................. 83,140 80,874
Total Shareholders' Equity ..................... 166,232 146,253
</TABLE>
The Company and CTS are subject to the information and reporting
requirements of the Exchange Act and are required to file reports and other
information with the SEC relating to its business, financial condition and other
matters. Information, as of particular dates, concerning the Company's and CTS'
directors and officers, their remuneration, stock options granted to them, the
principal holders of the Company's and CTS' securities, any material interests
of such persons in transactions with the Company or CTS and other matters is
required to be disclosed in proxy statements distributed to the Company's and
CTS' shareholders and filed with the SEC. These reports, proxy statements and
other information should be available for inspection at the public reference
facilities of the SEC located in Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549, and also should be available for inspection and copying
at prescribed rates at the following regional offices of the SEC: Seven World
Trade Center, New York, New York 10048; and 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661. Copies of this material may also be obtained by mail,
upon payment of the SEC's customary fees, from the SEC's principal office at 450
Fifth Street, N.W., Washington, D.C. 20549. The SEC also maintains an Internet
web site at http://www.sec.gov that contains reports, proxy statements and other
information. The common shares of the Company and CTS are listed on the NYSE,
and reports, proxy statements and other information concerning the Company or
CTS should also be available for inspection at the offices of the NYSE, 20 Broad
Street, New York, New York 10005.
THE RIGHTS. The following is based upon the Company's Form 8-A, dated
January 30, 1986 (the "Company Form 8-A"), and the Company Form 8-K, dated as of
December 27, 1995, filed with the SEC.
On January 30, 1986, the Board of Directors of the Company declared a
distribution of one Preferred Stock Purchase Right (a "Right") on each
outstanding Share to be distributed February 14, 1986. Under the Rights
Agreement, dated as of January 30, 1986, as amended on December 27, 1995,
between the Company and the First National Bank of Boston (the "Rights
Agreement"), each Right entitles the holder to purchase one one-hundredth of a
share of Series A Cumulative Preferred Stock (the "Preferred Stock") at an
exercise price of $80.00, subject to certain adjustments.
The Rights will be represented by the Share certificates and will not
be exercisable, or transferable apart from the Shares, until 10 days after the
public announcement that a person or group of affiliated or associated persons
has acquired, or obtained the right to acquire, the beneficial ownership of 20
percent or more of the Shares
-13-
<PAGE>
in a transaction not approved by the Company's Board of Directors prior to such
transaction (an "Acquiring Person"), or has commenced or intends to commence a
tender offer for 25 percent or more of the Shares. As soon as practicable after
such date (the "Distribution Date"), separate certificates evidencing the Rights
will be mailed to holders of record of Shares as of the close of business on the
Distribution Date and such separate certificates alone will evidence the Rights.
In the event that, after the Distribution Date, the Company is acquired
in a merger or other business combination transaction, provision will be made so
that each holder of Rights will be entitled to purchase, upon the exercise
thereof at then current exercise price of the Right, that number of shares of
common stock of the acquiring company which at the time of such transaction
would have a value equal to two times the exercise price of the Right. In the
event that the Company is the surviving corporation in such merger and the
Shares are not changed, each Right would become exercisable for that number of
shares of Preferred Stock having a market value of two times the exercise price
of the Right.
The Rights are redeemable in whole, but not in part, at $0.05 per Right
prior to a person or group of affiliated or associated persons acquiring
beneficial ownership of at least 20 percent of the Shares. The Rights will
expire on February 14, 2006 (unless the Rights are earlier redeemed by the
Company).
The First National Bank of Boston, 100 Federal Street, Boston,
Massachusetts 02110, Attention: Shareholders Services Division, is the Rights
Agent.
The purchase price payable, and the number of shares of Preferred Stock
or other securities or property issuable, upon exercise of the Rights are
subject to adjustment from time to time to prevent dilution (i) in the event of
a stock dividend on, or a subdivision, combination or reclassification of, the
Preferred Stock, (ii) upon the grant to holders of Preferred Stock of certain
rights or warrants to subscribe for shares of Preferred Stock or convertible
securities at less than the current market price of the Preferred Stock or (iii)
upon the distribution to holders of Preferred Stock of evidences of indebtedness
or assets (excluding regular periodic cash dividends out of earnings or retained
earnings or dividends payable in Preferred Stock) or of subscription rights or
warrants (other than those referred to above.) With certain exceptions, no
adjustment in the purchase price will be required until cumulative adjustments
require an adjustment of at least 1% in such purchase price.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a shareholder of the Company, including, without limitation, the right
to vote or to receive dividends.
The Preferred Stock purchasable upon exercise of the Rights will be
nonredeemable. Each share of Preferred Stock will be entitled to an aggregate
dividend of 100 times the dividend declared on the Common Stock, but in no event
less than semiannual dividends of $240 per share. In the event of liquidation,
the holders of the Preferred Stock will receive a preferred liquidation payment
equal to the greater of $8,000 per share and 100 times the payment made per
share of Common Stock. Each share of Preferred Stock will have 100 votes, voting
together with the voting Common Stock. In the event of any merger, consolidation
or other transaction in which shares of Common Stock are exchanged for or
changed into other stock or securities, cash or other property, each share of
Preferred Stock will be entitled to receive 100 times the amount received per
share of Common Stock. The foregoing rights of the Preferred Stock are protected
against dilution in the event additional shares of Common Stock are issued.
The foregoing summary of the Rights Agreement does not purport to be
complete and is qualified in its entirety by reference to the Company Form 8-A,
the text of the Rights Agreement as an exhibit thereto filed with the SEC and
subsequent amendments to the Rights Agreement as filed with the SEC. Copies of
these documents may be obtained in the manner set forth above.
Shareholders are required to tender one associated Right for each Share
tendered in order to effect a valid tender of such Share. If the Distribution
Date does not occur prior to the Expiration Date, a tender of Shares will
automatically constitute a tender of the associated Rights. See Section 3. In
the event the Company reduces below 20% the ownership percentage to become an
Acquiring Person, the Specified Percentage will be commensurately reduced. See
Introduction and Section 1.
-14-
<PAGE>
8. CERTAIN INFORMATION CONCERNING PURCHASER AND PARENT.
PURCHASER. Purchaser is a New York corporation which was recently
organized in connection with the Offer. The principal offices of Purchaser are
located at 110 East 59th Street, New York, NY 10022. Purchaser is a wholly owned
subsidiary of Parent. Until immediately prior to the time that Purchaser will
purchase Shares pursuant to the Offer, it is not expected that Purchaser will
have any significant assets or liabilities or engage in activities other than
the ownership of approximately 2.9% of the Shares and those activities incident
to the transactions contemplated by the Offer.
PARENT. Parent is a Delaware corporation with its principal executive
offices located at 110 East 59th Street, New York, NY 10022.
Parent, through its subsidiaries, is the ninth largest domestic
integrated steel manufacturer. Parent manufactures a wide variety of flat-rolled
products for construction, container, converter/processor, steel service center,
automotive and other markets as well as fabricated steel products for the
construction, highway and agricultural markets. Flat-rolled products consist of
a variety of sheet products, including hot-rolled, cold-rolled, galvanized and
pre-painted products, and tin mill products. Fabricated steel products include
roof deck, culvert, highway and other products.
Parent's financial results for 1996 reflect a strike by the United
Steelworkers of America ("USWA") which began October 1, 1996 and has continued
to date. No steel products are being produced or shipped at eight of Parent's
plants located in Ohio, Pennsylvania and West Virginia which are subject to the
work stoppage. These facilities represent approximately 80% of the tons shipped
by Parent on an annual basis. Parent experienced a net loss of approximately
$34.6 million in the strike-affected fourth quarter of 1996, and would expect to
incur material losses for the duration of the work stoppage. Although Parent has
been negotiating with the USWA to end the work stoppage on terms satisfactory to
Parent, there can be no assurance that these negotiations will be successful,
and it is unclear how long the work stoppage will continue and the impact it
will have on Parent. Depending on the length of the work stoppage, Parent's
financial condition and liquidity may be materially adversely affected. However,
Parent does not believe that the work stoppage will affect its ability to
complete the Offer or the Merger Proposal.
See Section 9.
FINANCIAL INFORMATION. Set forth below is a summary of certain
consolidated financial information with respect to Parent and its subsidiaries
for its fiscal years ended December 31, 1995 and 1994, and for the nine months
ended September 30, 1996, excerpted from financial statements presented in
Parent's 1996 Annual Report on Form 10-K filed with the SEC. More comprehensive
financial information is included in such reports (including management's
discussion and analysis of results of operations and financial position) and
other documents filed by Parent with the SEC, and the financial information
summary set forth below is qualified in its entirety by reference to such
reports, which are incorporated herein by reference, and all the financial
information and related notes contained therein.
-15-
<PAGE>
WHX CORPORATION
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Year Ended December 31,
------------------------------------------------
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
INCOME STATEMENT DATA:
Net sales............................................... $1,232,696 $1,364,614 $1,193,878
Income before taxes..................................... (3,449) 100,075 110,725
Net (loss) income....................................... 658 78,018 76,381
INCOME PER COMMON SHARE INFORMATION:
Dividend Requirement for Preferred Stock....... 22,313 22,875 13,177
Net Income (loss) Applicable to Common Stock... (21,655) 55,143 63,204
Income (loss) per share of Common Stock........
Primary............................... (.82) 2.07 2.19
Fully Diluted......................... (.82) 1.73 1.89
</TABLE>
<TABLE>
<CAPTION>
At December 31,
-------------------------------------
1996 1995
---- ----
<S> <C> <C>
BALANCE SHEET DATA:
Total Current Assets.................................... $ 737,731 $797,649
Property, Plant and Equipment at cost, less 755,412 793,319
accumulated depreciation and amortization.............
Total Assets............................................ 1,718,779 1,796,467
Total Liabilities....................................... 998,571 1,021,674
Total Shareholders' Equity.............................. 714,437 768,405
</TABLE>
Parent is subject to the information and reporting requirements of the
Exchange Act and is required to file reports and other information with the SEC
relating to its business, financial condition and other matters. Information, as
of particular dates, concerning Parent's directors and officers, their
remuneration, stock options granted to them, the principal holders of Parent's
securities, any material interests of such persons in transactions with Parent
and other matters is required to be disclosed in proxy statements distributed to
Parent's shareholders and filed with the SEC. These reports, proxy statements
and other information should be available for inspection and copies may be
obtained in the same manner as set forth for the Company and CTS in Section 7.
The shares of Parent common stock are listed on the NYSE, and reports, proxy
statements and other information concerning Parent should also be available for
inspection at the offices of the NYSE, 20 Broad Street, New York, New York
10005.
The name, citizenship, business address, principal occupation or
employment and five-year employment history for each of the directors and
executive officers of Parent and Purchaser are set forth in Schedule I hereto.
OWNERSHIP OF SHARES. Currently, the Purchaser owns 109,600 Shares, all
of which were acquired by Parent and transferred to the Purchaser in the past 30
days. An affiliate of the Parent acquired 80,000 of such Shares from Steel
Partners II, L.P. ("Steel Partners") and an entity affiliated with Steel
Partners Services, Ltd. ("Steel Services") on March 13, 1997 at a price of $32
1/2 per Share (the prevailing market price on that date). Based on publicly
available information, Mr. Warren Lichtenstein is the sole executive officer and
managing member of a limited liability company which is the general partner of
Steel Partners and the sole executive officer and shareholder of Steel Services.
Mr. Ronald LaBow, Chairman of Parent, and Mr. Lichtenstein have had business
dealings with each other for several years, and Mr. LaBow has known about Steel
Partners' and Steel Services' ownership interest in the Company since late 1994
or early 1995. Earlier this month, Mr. LaBow contacted Mr. Lichtenstein and
asked if Steel Partners and Steel Services, which owned an aggregate of 209,700
Shares (approximately 5.5% of the outstanding Shares), would be willing to sell
all of their Shares to Parent or establish a joint arrangement in which Parent
might acquire additional Shares. Mr. Lichtenstein responded that the entire
ownership position of Steel Partners and Steel Services was not available by
sale and that there was no desire for such entities to act in concert
-16-
<PAGE>
with Parent, inasmuch as he and his affiliates wished to remain free to make
investment decisions concerning their Shares in their sole discretion and
without consultation with others. However, Mr. Lichtenstein did indicate a
willingness to sell a portion of the Shares held by his affiliates. After
negotiation regarding the amount and price for such a sale, Mr. Lichtenstein
agreed to sell 80,000 Shares to Parent as described above. Parent expressly
disclaims that it is acting as a "group" or otherwise in concert with Steel
Partners, Steel Services, Mr. Lichtenstein or any of their respective affiliates
in respect to any remaining Shares which they may currently own or acquire in
the future.
Except as set forth in Schedule III of this Offer to Purchase, neither
Parent nor Purchaser, nor, to the best knowledge of Parent or Purchaser, any of
the persons listed in Schedule I hereto, or any associate or majority-owned
subsidiary of such persons, beneficially owns any equity security of the
Company, and neither Parent nor Purchaser, nor, to the best knowledge of Parent
or Purchaser, any of the other persons referred to above, or any of the
respective directors, executive officers or subsidiaries of any of the
foregoing, has effected any transaction in any equity security of the Company
during the past 60 days.
Except as set forth in this Offer to Purchase, neither Parent nor
Purchaser, nor, to the best knowledge of Parent or Purchaser, any of the persons
listed in Schedule I hereto has any contract, arrangement, understanding or
relationship with any other person with respect to any securities of the
Company, including, without limitation, any contract, arrangement, understanding
or relationship concerning the transfer or the voting of any securities of the
Company, joint ventures, loan or option arrangements, puts or calls, guaranties
of loans, guaranties against loss or the giving or withholding of proxies.
Except as set forth in this Offer to Purchase, neither Parent nor Purchaser,
nor, to the best knowledge of Parent or Purchaser, any of the persons listed in
Schedule I hereto has had any transactions with the Company, or any of its
executive officers, directors or affiliates that would require reporting under
the rules of the SEC.
Except as set forth in this Offer to Purchase, there have been no
contacts, negotiations or transactions between Parent or Purchaser, or their
respective subsidiaries, or, to the best knowledge of Parent or Purchaser, any
of the persons listed in Schedule I hereto, on the one hand, and the Company or
its executive officers, directors or affiliates, on the other hand, concerning a
merger, consolidation or acquisition, tender offer or other acquisition of
securities, election of directors, or a sale or other transfer of a material
amount of assets.
9. SOURCE AND AMOUNT OF FUNDS.
Purchaser estimates that the total amount of funds required to purchase
Shares pursuant to the Offer and to pay all related costs and expenses will be
approximately $26 million. Purchaser plans to obtain such funds through capital
contributions or advances made by Parent. As of December 31, 1996 Parent had
available over $400 million in cash and cash equivalents.
10. BACKGROUND OF THE OFFER; CONTACTS WITH THE COMPANY.
In the ordinary course of Parent's long-term strategic review process,
Parent and its subsidiaries routinely analyze potential combinations with
various companies. Recently, Parent has placed particular emphasis on studies of
the Company, considering it to be an ideal candidate for such a combination.
On March 27, 1997, Parent sent the following letter to the Chairman of
the Company regarding a proposed business combination between the Company and
Parent:
"Dear Mr. Lozyniak:
We are writing to propose a business combination between our companies
and to express a desire that we work together to accomplish this transaction on
an amicable, negotiated basis.
The Board of Directors of WHX has authorized me to present an offer to
acquire in a merger transaction all of the outstanding shares of common stock of
Dynamics Corp. at a price of $40 per share. This proposal represents a premium
of 16% over the current market price and nearly 30% over the market price at
year-end.
-17-
<PAGE>
In making this proposal, please be advised that we have no interest in
increasing the equity stake which Dynamics Corp. holds in CTS Corporation, or in
changing the nature of the current relationship between the two companies.
This proposal is subject to negotiation and execution of appropriate
definitive agreements containing customary and mutually acceptable
representations, warranties, terms and conditions. In pursuing this transaction,
we would expect representatives from your Board of Directors to join the board
of the combined enterprise and the senior management of your company to stay
with the combined enterprise under mutually satisfactory arrangements.
We are confident of our ability to complete this transaction on these
terms. In this respect, please note that as of December 31, 1996 we have
available over $400 million in cash and cash equivalents.
We are certain that, upon reflection, your Board of Directors will
recognize the fine opportunity which a combination with WHX represents for your
stockholders. Our objective is to work with you in a professional and
constructive manner to complete our proposal so that the best interests of your
stockholders and employees can be served. Please be advised that we would be
prepared to increase our offer if additional information which may be provided
about your company demonstrates that a higher price is warranted.
We are willing to discuss with you or a committee of your directors all
aspects of our proposal and to answer any questions which you may have. I and
other representatives of WHX are available to meet with you for this purpose at
any time. If we do not hear from you by the close of business on Friday, March
28, we are authorized to present this proposal directly to your stockholders,
through a proxy solicitation at the upcoming annual meeting and through a cash
tender offer.
Very truly yours,
/s/ Ron LaBow
Ron LaBow
Chairman of the Board"
Parent has not received a response to this letter and has decided to
commence this Offer and the proxy solicitation described below in furtherance of
the Merger Proposal.
11. PURPOSE OF THE OFFER; THE MERGER OFFER; PROXY SOLICITATION;
PLANS FOR THE COMPANY.
PURPOSE OF THE OFFER. The purpose of the Offer is for Parent, through
Purchaser, to acquire a significant equity interest in the Company as the first
step in a business combination of Parent and the Company. The purpose of the
Merger would be to acquire all outstanding Shares not acquired pursuant to the
Offer or otherwise.
THE MERGER PROPOSAL. Parent and Purchaser currently intend, as soon as
practicable following completion of the Offer, to seek to consummate the Merger.
Parent and Purchaser intend that in the Merger, each then outstanding Share
(other than Shares owned by Parent, Purchaser or any of their wholly owned
subsidiaries and Shares held in the treasury of the Company) and the shares of
the Company's non-voting common stock would be converted into the right to
receive $40 in cash, without interest. Pursuant to the New York Business
Corporation Law ("NYBCL"), consummation of the Merger would require the adoption
of a resolution by the Company's Board of Directors approving the Merger and the
affirmative vote of the holders of two-thirds of all of the Shares entitled to
vote. Consummation of the Merger would also require approval by Parent, as the
sole shareholder of Purchaser.
PROXY SOLICITATION. In addition to commencing the Offer, Purchaser
intends to solicit proxies from the shareholders of the Company at the Annual
Meeting to (i) elect to the Purchaser Nominees listed on Schedule II of this
Offer to Purchase, which, if elected, would constitute a majority of such Board
of Directors, and (ii) adopt the
-18-
<PAGE>
By-law Amendments. The Purchaser Nominees are committed to promptly effect a
merger of the Company with and into the Purchaser at a price of $40 per Share in
cash.
Purchaser has determined to seek the election of the Purchaser Nominees
to succeed the four of seven members of the incumbent Board who are currently
standing for re-election at the Annual Meeting. The Purchaser Nominees are
committed to maximizing shareholder value by removing any impediments to the
Merger Proposal created by the Company's current Board. If elected, the
Purchaser Nominees intend to cause the Board to take appropriate steps to allow
Purchaser to acquire the entire equity interest in the Company by entering into
a merger agreement with Purchaser pursuant to which (i) Purchaser would purchase
the Shares pursuant to the Offer and (ii) the Merger would be effected.
Purchaser believes that the interests of shareholders will be best served by
replacing a majority of the incumbent directors with a new slate of directors
committed to effecting the Merger.
Purchaser will furnish a written proxy statement at the earliest
practicable date in accordance with applicable regulations. Schedule II contains
information concerning the Purchaser Nominees.
Purchaser believes that, if elected, the Parent Nominees will redeem
the Rights, terminate the Rights Agreement or take such other action as is
necessary to remove any impediments to the Merger. Although Parent and Purchaser
intend to seek consummation of the Merger as soon as practicable following the
purchase of Shares pursuant to the Offer, the outcome of the proxy solicitation
and certain terms of the Rights may affect the ability of Parent and Purchaser
to obtain control of the Company and to consummate the Merger. Accordingly, the
exact timing, price, form of consideration and other terms of the Merger will
depend on a variety of factors and legal requirements, the actions of the Board,
the number of Shares acquired by Purchaser pursuant to the Offer and whether the
certain conditions are satisfied or waived. Parent and Purchaser can give no
assurance that the Merger will be consummated or as to the timing of the Merger
if it is consummated. Although Parent and Purchaser currently intend to propose
the Merger generally on the terms described above, it is possible that, as a
result of substantial delays in Parent and Purchasers' ability to effect such a
transaction, information hereafter obtained by Parent and Purchaser, changes in
general economic or market conditions or in the business of the Company, the
applicability of certain of the matters described below, or other presently
unforeseen factors, such a transaction may not be so proposed, may be delayed or
abandoned or may be proposed on different terms. Although they have no current
intention to do so, Parent and Purchaser expressly reserve the right not to
propose the Merger or to propose such a transaction on terms other than those
described above.
In connection with the Offer and during its pendency, or in the event
the Offer is terminated or not consummated, or after the expiration of the Offer
and pending the consummation of the Proposed Merger, in accordance with
applicable law and subject to the terms of any merger agreement that it may
enter into with the Company, Parent and Purchaser (alone or through affiliates)
may explore any and all options which may be available to them. Parent and
Purchaser reserve the right to acquire additional Shares after consummation of
the Offer in open market purchases, through a tender offer, in privately
negotiated transactions or otherwise, in order to obtain a sufficient number of
Shares to approve the transactions contemplated hereby, provided that such
purchases will not exceed such amount so as to cause a Distribution Date under
the Rights Agreement to be declared.
The Commission has adopted Rule 13e-3 under the Exchange Act, which is
applicable to certain "going private" transactions and which may under certain
circumstances be applicable to the Merger following the purchase of Shares
pursuant to the Offer in which the Purchaser seeks to acquire any remaining
Shares. Rule 13e-3 should not be applicable to the Merger if the Merger is
consummated within one year after the expiration or termination of the Offer and
the price paid in the Merger is not less than the per Share price paid pursuant
to the Offer. However, in the event that the Purchaser is deemed to have
acquired control of the Company pursuant to the Offer and the proxy solicitation
and if the Merger is consummated more than one year after completion of the
Offer or an alternative acquisition transaction is effected whereby shareholders
of the Company receive consideration less than that paid pursuant to the Offer,
in either case at a time when the Shares are still registered under the Exchange
Act, the Purchaser may be required to comply with Rule 13e-3 under the Exchange
Act. If applicable, Rule 13e-3 would require, among other things, that certain
financial information concerning the Company and certain information relating to
the fairness of the Merger or such alternative transaction and the consideration
offered to the shareholders other than the Purchaser, the Parent and their
affiliates in the Merger or such alternative transaction, be filed with the
Commission and disclosed to shareholders prior to consummation of the Merger or
such alternative transaction.
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If such registration were terminated, Rule 13e-3 would be inapplicable to any
such future Merger or alternative transaction.
THE OFFER DOES NOT CONSTITUTE A SOLICITATION OF PROXIES FOR ANY MEETING
OF THE COMPANY'S SHAREHOLDERS. ANY SUCH SOLICITATION WHICH PURCHASER OR PARENT
MIGHT MAKE WOULD BE MADE ONLY PURSUANT TO SEPARATE PROXY MATERIALS COMPLYING
WITH THE REQUIREMENTS OF SECTION 14(A) OF THE EXCHANGE ACT.
PLANS FOR THE COMPANY. Purchaser and Parent have no present intention
to make any significant changes in the business strategies of the Company, and
they have not identified any specific assets, corporate structure, or other
business strategy which warrants change. However, Purchaser has made a
preliminary review of, and will continue to review, on the basis of available
information, various possible business strategies that it might consider if it
acquires control of the Company. If Purchaser acquires control of the Company,
Purchaser intends to conduct a detailed review of the Company and its assets,
pension plans, corporate structure, dividend policy, capitalization, operations,
properties, policies, management and personnel and consider what, if any,
changes or sale of assets would be desirable in light of the circumstances which
then exist. As noted in Parent's letter to the Company dated March 27, 1997, if
Purchaser acquires control of the Company Purchaser does not intend to purchase
additional shares of CTS or otherwise change the current relationship between
the Company and CTS. See Section 10.
Except as noted in this Offer to Purchase, neither Parent nor Purchaser
has any present plans or proposals that would result in an extraordinary
corporate transaction, such as a reorganization, liquidation, relocation of
operations, or sale or transfer of assets, involving the Company or any of its
subsidiaries, or any material changes in the Company's corporate structure,
business or composition of its board of directors, management or personnel.
12. DIVIDENDS AND DISTRIBUTIONS.
If, on or after the date of this Offer to Purchase, the Company should
(i) split, combine or otherwise change the Shares or its capitalization, (ii)
issue or sell any additional securities of the Company or otherwise cause an
increase in the number of outstanding securities of the Company or (iii) acquire
currently outstanding Shares or otherwise cause a reduction in the number of
outstanding Shares, then, without prejudice to Purchaser's rights under Sections
1 and 13, Purchaser, in its sole discretion, may make such adjustments as it
deems appropriate in the purchase price and other terms of the Offer and the
Merger, including, without limitation, the amount and type of securities offered
to be purchased.
If, on or after the date of this Offer to Purchase, the Company should
declare or pay any dividend on the Shares, other than regular semi-annual
dividends not to exceed $.10 per Share, or make any distribution (including,
without limitation, the issuance of additional Shares pursuant to a stock
dividend or stock split, the issuance of other securities or the issuance of
rights for the purchase of any securities) with respect to the Shares that is
payable or distributable to shareholders of record on a date prior to the
transfer to the name of Purchaser or its nominee or transferee on the Company's
stock transfer records of the Shares purchased pursuant to the Offer, then,
without prejudice to Purchaser's rights under Sections 1 and 13, (i) the
purchase price per Share payable by Purchaser pursuant to the Offer will be
reduced by the amount of any such cash dividend or cash distribution, and (ii)
any such non-cash dividend, distribution or right to be received by the
tendering shareholders will be received and held by such tendering shareholders
for the account of Purchaser and will be required to be promptly remitted and
transferred by each such tendering shareholder to the Depositary for the account
of Purchaser, accompanied by appropriate documentation of transfer. Pending such
remittance and subject to applicable law, Purchaser will be entitled to all
rights and privileges as owner of any such non-cash dividend, distribution or
right and may withhold the entire purchase price or deduct from the purchase
price the amount of value thereof, as determined by Purchaser in its sole
discretion.
13. CONDITIONS OF THE OFFER.
Notwithstanding any other provisions of the Offer, and in addition to
(and not in limitation of) Purchaser's rights to extend and amend the Offer at
any time in its sole discretion, Purchaser shall not be required to accept for
payment or, subject to any applicable rules and regulations of the SEC,
including Rule 14e-1(c) under the Exchange Act (relating to Purchaser's
obligation to pay for or return tendered Shares promptly after termination or
withdrawal
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of the Offer), pay for, and may delay the acceptance for payment of or, subject
to the restriction referred to above, the payment for, any tendered Shares, and
may terminate the Offer as to any Shares not then paid for, if in the sole
judgment of Purchaser, at any time on or after March 27, 1997 and prior to the
acceptance for payment of, or payment for, such Shares, any of the following
events shall occur or shall be determined by Purchaser to have occurred:
(a) there shall have been threatened, instituted or pending
any action, proceeding, claim or application by any government or
governmental regulatory or administrative authority or agency,
domestic, foreign or supranational, or by any other person, domestic or
foreign, before any court or governmental, regulatory or administrative
agency, authority or tribunal, domestic, foreign or supranational, that
(i) challenges or seeks to make illegal, to delay or otherwise directly
or indirectly to restrain or prohibit, or which is likely to impose, in
the sole judgment of Purchaser, voting, procedural, price or other
requirements and federal securities law in connection with the
acquisition of Shares by Purchaser or any of its affiliates, the making
of the Offer, the acceptance for payment of or payment for Shares by
Purchaser or any of its affiliates or the consummation of the Merger or
any other business combination involving the Company or the performance
of any of the contracts or other arrangements entered into by Purchaser
or any of its affiliates in connection with the acquisition of the
Company, seeking to obtain any material damages as a result thereof or
otherwise directly or indirectly relating to the Offer or the Merger or
such other business combination, (ii) seeks to restrain, prohibit or
limit the exercise of full rights of ownership or operation by
Purchaser or any of its affiliates of all or any portion of the
business or assets of the Company or any of its subsidiaries or
Purchaser or any of its affiliates or to compel Purchaser or any of its
affiliates to dispose of or to hold separately all or any portion of
the business or assets of the Company or any of its subsidiaries or
Purchaser or any of its affiliates, (iii) seeks to impose or confirm
limitations on the ability of Purchaser or any of its affiliates
effectively to acquire or hold or to exercise full rights of ownership
of Shares, including without limitation the right to vote the Shares
acquired or owned by the Parent or Purchaser or any of its affiliates
on all matters properly presented to the shareholders of the Company,
or the right to vote any shares of capital stock of any subsidiary
directly or indirectly owned by the Company, (iv) seeks to require
divestiture by the Parent or Purchaser or any of its affiliates of any
Shares, (v) might result, in the sole judgment of Purchaser, in a
diminution of the benefits expected to be derived by Purchaser or any
of its affiliates as a result of the Offer or the Merger or any other
business combination involving the Company, or in a diminution of the
value of the Shares or the Company or any of its subsidiaries to
Purchaser or any of its affiliates, or (vi) challenges or adversely
affects the Merger or any other business combination involving the
Company; or
(b) other than the application of the waiting periods under
the HSR Act and the necessity for the approvals and other actions by
any domestic (federal and state) or foreign or supranational
governmental, administrative or regulatory agency described in Section
14, there shall have been proposed, sought, promulgated, enacted,
entered, enforced or deemed applicable to the Offer, the Merger or any
other business combination involving the Company, by any government or
governmental, regulatory or administrative agency or authority or by
any court or tribunal, in each case whether domestic, foreign or
supranational, any statute, rule, regulation, judgment, decree,
decision, order or injunction that, in the sole judgment of Purchaser,
might, directly or indirectly, result in any of the consequences
referred to in clauses (i) through (vi) of paragraph (a) above; or
(c) any change (or any condition, event or development
involving a prospective change) shall have occurred or been threatened
in the business, properties, assets, liabilities, shareholders' equity,
financial condition, capitalization, licenses, franchises, permits,
operations, results of operations or prospects of the Company or any of
its subsidiaries, affiliates or CTS (or Purchaser shall have become
aware thereof) or in general economic or financial market conditions in
the United States or abroad that, in the sole judgment of Purchaser, is
or may be materially adverse to the Company or any of its subsidiaries
or affiliates, or Purchaser shall have become aware of any facts that,
in the sole judgment of Purchaser, have or may have material adverse
significance with respect to either the value of the Company or any of
its subsidiaries or affiliates or CTS, or the value of the Shares to
the Parent or Purchaser or any of its affiliates; or
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(d) there shall have occurred (i) any general suspension of
trading in, or limitation on prices for, securities on any national
securities exchange or in the United States over-the-counter market,
(ii) the declaration of a banking moratorium or any suspension of
payments in respect of banks in the United States, (iii) any material
adverse change (or any existing or threatened condition, event or
development involving a prospective material adverse change) in United
States or any other currency exchange rates or a suspension of, or a
limitation on, the markets therefor, (iv) any other material adverse
change in the market price of the Shares, the shares of CTS or in the
United States securities or financial markets generally, including
without limitation, a decline of at least 10% in either the Dow Jones
Average of Industrial Stocks or the Standard & Poor's 500 index from
March 31, 1997 through the date of termination or expiration of the
Offer, (v) the commencement of a war, armed hostilities or other
international or national calamity directly or indirectly involving the
United States, (vi) any limitation (whether or not mandatory) by any
governmental authority or any other event that, in the sole judgment of
Purchaser, may have material adverse significance with respect to the
extension of credit by banks or other lending institutions or the
financing of the Offer or the Merger or any other business combination
involving the Company or (vii) in the case of any of the situations
described in clauses (i) through (vi) above existing at the time of the
commencement of the Offer, a material acceleration or worsening
thereof; or
(e) a tender or exchange offer for some or all of the Shares
shall have been publicly proposed to be made or shall have been made by
another person (including the Company or any of its subsidiaries or
affiliates), or it shall have been publicly disclosed or Purchaser
shall have otherwise deemed that (i) any person, entity (including the
Company or any of its subsidiaries or affiliates) or "group" (within
the meaning of Section 13(d)(3) of the Exchange Act) shall have
acquired or proposed to acquire beneficial ownership of more than 10%
of any class or series of capital stock of the Company (including the
Shares) through the acquisition of stock, the formation of a group or
otherwise, or shall have been granted any option, right or warrant,
conditional or otherwise, to acquire beneficial ownership of more than
10% of any class or series of capital stock of the Company (including
the Shares), other than acquisitions for bona fide arbitrage purposes
only and other than as disclosed in a Schedule 13D or 13G on file with
the Commission prior to March 31, 1997, (ii) any such person, entity or
group which, prior to such date, had filed such a Schedule with the
Commission, shall have acquired or proposed to acquire, through the
acquisition of stock, the formation of a group or otherwise, beneficial
ownership of additional shares of any class or series of capital stock
of the Company (including the Shares) constituting 2% or more of any
such class or series, or shall have been granted any option, right or
warrant, conditional or otherwise, to acquire beneficial ownership of
shares of any class or series of capital stock of the Company
(including the Shares) constituting 2% or more of any such class or
series, (iii) any person, entity or group shall have entered into a
definitive agreement or an agreement in principle or made a proposal
with respect to a tender or exchange offer for some or all the Shares
or a merger, consolidation or other business combination with or
involving the Company or any of its subsidiaries or affiliates or (iv)
any person, entity or group shall have filed a Notification and Report
Form under the HSR Act or made a public announcement reflecting an
intent to acquire the Company or any of its subsidiaries or any assets
or securities of the Company or any of its subsidiaries; or
(f) the Company or any of its subsidiaries shall have,
directly or indirectly, (i) split, combined or otherwise changed, or
authorized or proposed the split, combination or other change of, the
Shares or its capitalization, (ii) acquired or otherwise caused a
reduction in the number of, or authorized or proposed the acquisition
or other reduction in the number of, any outstanding Shares (other than
a redemption of the Rights in accordance with the terms of the Rights
Agreement as publicly disclosed to be in effect on March 31, 1997) or
other securities of the Company or any subsidiary thereof, (iii)
issued, distributed or sold, or authorized, proposed or announced the
issuance, distribution or sale of, (A) any additional Shares, shares of
any other class or series of capital stock, other voting securities, or
any securities convertible into or exchangeable or exercisable for any
of the foregoing, or options, rights or warrants, conditional or
otherwise, to acquire any of the foregoing in accordance with their
terms, (B) any shares of any class or series of capital stock, other
voting securities, or any securities convertible into or exchangeable
or exercisable for any of the foregoing of CTS or (C) any other
securities or rights in respect of, in lieu of or in substitution or
exchange for any shares of its capital stock, (iv) permitted the
issuance or sale of any shares of any class of capital stock or other
debt or equity securities of any subsidiary of the Company or
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any securities convertible into or exchangeable or exercisable for any
of the foregoing, (v) declared, paid or proposed to declare or pay any
dividend or other distribution, whether payable in cash, securities or
other property, on, or in respect of, any Shares (other than a
redemption of the Rights in accordance with the Rights Agreement as
publicly disclosed to be in effect on March 31, 1997 and distributions
of regular semi-annual dividends not to exceed $.10 per Share), (vi)
altered or proposed to alter any material term of any outstanding
security of the Company or any of its subsidiaries (including the
Rights), (vii) issued, distributed or sold, or authorized or proposed
the issuance, distribution or sale of, any debt securities or
securities convertible into or exchangeable or exercisable for debt
securities or any rights, warrants or options entitling the holder
thereof to purchase or otherwise acquire any debt securities, or
otherwise incurred, authorized or proposed the incurrence of, any debt
other than in the ordinary course of business and consistent with past
practice or any debt containing burdensome covenants, (viii)
authorized, recommended, proposed, effected or announced its intention
to engage in any merger (other than the Merger), consolidation,
liquidation, dissolution, business combination, acquisition (including
by way of exchange) of assets or securities, disposition (including by
way of exchange) of assets or securities, joint venture, any release or
relinquishment of any material contract or other rights of the Company
or any of its affiliates or CTS or any comparable event not in the
ordinary course of business, (ix) authorized, recommended, proposed or
announced its intent to enter into, or entered into any agreement or
arrangement with any person, entity or group that in the sole judgment
of Purchaser, has or may have material adverse significance with
respect to the value of the Company or any of its affiliates, or the
value of the Shares to Purchaser or any of its affiliates, (x) amended
or proposed, adopted or authorized any amendment (other than any
amendment which provides that the Rights are inapplicable to the Offer
and the Merger) to the Charter or the By-Laws or similar organizational
documents of the Company or any of its subsidiaries or the Rights
Agreement or Purchaser shall have learned that the Company or any of
its subsidiaries shall have proposed or adopted any such amendment
which shall not have been previously disclosed, (xi) entered into or
amended any employment, severance or similar agreement, arrangement or
plan with or for the benefit of any employee of the Company or any of
its subsidiaries (other than in the ordinary course of business) or so
as to provide for increased or accelerated benefits to employees as a
result of or in connection with the making of the Offer, the acceptance
for payment of or payment for Shares by Purchaser or the consummation
by Purchaser or any of its affiliates of the Merger or any other
business combination involving the Company, (xii) except as may be
required by law, taken any action to terminate or amend any employee
benefit plan (as defined in Section 3(2) of the Employee Retirement
Income Security Act of 1974, as amended) of the Company or any of its
affiliates, or Purchaser shall have become aware of any such action
which shall not have been previously disclosed, or (xiii) agreed in
writing or otherwise to take any of the foregoing actions; or
(g) Purchaser shall become aware (i) that any material
contractual right of the Company or any of its subsidiaries shall be
impaired or otherwise adversely affected or that any material amount of
indebtedness of the Company or any of its subsidiaries shall become
accelerated or otherwise become due or become subject to acceleration
prior to its stated due date, in each case with or without notice or
the lapse of time or both, as a result of or in connection with the
Offer or the consummation by Purchaser or any of its affiliates of the
Merger or any other business combination involving the Company, (ii) of
any covenant, term or condition in any of the instruments or agreements
of the Company or any of its subsidiaries that, in the sole judgment of
Purchaser, is or may be (whether considered alone or in the aggregate
with other such covenants, terms or conditions) materially adverse to
either the value of the Company or any of its subsidiaries (including
without limitation any event of default that may occur as a result of
or in connection with the Offer, the consummation by Purchaser or any
of its affiliates of the Merger or any other business combination
involving the Company) or the value of the Shares to Purchaser or any
of its affiliates or the consummation by Purchaser or any of its
affiliates of the Merger or any other business combination involving
the Company, or (iii) that any report, document, instrument, financial
statement or schedule of the Company filed with the Commission
contained, when filed, an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary in order to make the statements made therein, in light of the
circumstances under which they were made, not misleading; or
(h) any waiting periods under the HSR Act applicable to the
purchase of Shares pursuant to the Offer shall not have expired or been
terminated, or any approval, permit, authorization or consent of
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any domestic or foreign or supranational governmental, administrative
or regulatory agency (federal, state, local, provincial or otherwise)
(including those described or referred to in Section 14) which is
required or believed to be appropriate shall not have been obtained on
terms satisfactory to the Parent in its sole discretion; or
(i) Purchaser or any of its affiliates shall have entered into
a definitive agreement or announced an agreement in principle with
respect to the Merger or any other business combination with the
Company or any of its affiliates or the purchase of any material
portion of the securities or assets of the Company or any of its
subsidiaries, or Purchaser or any of its affiliates and the Company
shall have agreed that Purchaser shall amend or terminate the Offer or
postpone the payment for the Shares pursuant thereto.
The foregoing conditions (in addition to the Record Holder Condition
described in Introduction and Section 1) are for the sole benefit of Purchaser
and may be waived by Purchaser in whole or in part at any time and from time to
time in its sole discretion. Any determination by Purchaser concerning the
events described above shall be final and binding upon all parties including
tendering shareholders. The failure by Purchaser at any time to exercise any of
the foregoing rights shall not be deemed a waiver of any such right and each
such right shall be deemed an ongoing right which may be asserted at any time
and from time to time.
A public announcement will be made of a material change in, or waiver
of, such conditions, to the extent required by Rules 14d-4(c) and 14d-6(d) under
the Exchange Act, and the Offer will be extended in connection with any such
change or waiver to the extent required by such rules.
14. CERTAIN LEGAL MATTERS AND REGULATORY APPROVALS.
GENERAL. Except as set forth below, based upon an examination of
publicly available filings made by the Company with the Commission and other
publicly available information concerning the Company, neither Purchaser nor the
Parent is aware of any licenses or other regulatory permits that appear to be
material to the business of the Company and its subsidiaries, taken as a whole,
that might be adversely affected by Purchaser's acquisition of Shares (and the
indirect acquisition of the stock of the Company's subsidiaries) as contemplated
herein, or of any filings, approvals or other actions by or with any domestic
(federal or state), foreign or supranational governmental authority or
administrative or regulatory agency that would be required prior to the
acquisition of Shares (or the indirect acquisition of the stock of the Company's
subsidiaries) by Purchaser pursuant to the Offer as contemplated herein. Should
any such approval or other action be required, it is Purchaser's present
intention to seek such approval or action. However, Purchaser does not presently
intend to delay the purchase of Shares tendered pursuant to the Offer pending
the receipt of any such approval or the taking of any such action (subject to
Purchaser's right to delay or decline to purchase Shares if any of the
conditions in Section 13 shall have occurred). There can be no assurance that
any such approval or other action, if needed, would be obtained without
substantial conditions or that adverse consequences might not result to the
business of the Company, the Parent or Purchaser or that certain parts of the
businesses of the Company, the Parent or Purchaser might not have to be disposed
of or held separate or other substantial conditions complied with in order to
obtain such approval or other action or in the event that such approval was not
obtained or such other action was not taken, any of which could cause Purchaser
to elect to terminate the Offer without the purchase of the Shares thereunder.
Purchaser's obligation under the Offer to accept for payment and pay for Shares
is subject to certain conditions, including conditions relating to the legal
matters discussed in this Section 14. See Section 13.
NEW YORK BUSINESS COMBINATION STATUTE. In general, the New York
Business Combination Statute prohibits any person who is the "beneficial owner"
of 20% or more of the outstanding voting stock of a corporation and therefore is
an "interested shareholder" from engaging in certain business combinations
(including a merger) with such corporation for a period of five years following
the date on which such person first became an interested shareholder, unless the
transaction by which such person became an interested shareholder or the
business combination is approved by the board of directors of the corporation
prior to the date on which such person became an interested shareholder.
INDIANA TAKEOVER STATUTE. CTS is an Indiana corporation. Chapter 42 of
the Indiana Business Corporation Law ("IBCL") provides, in general, that the
shares of an issuing public corporation (as defined therein) acquired in
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a control share acquisition (as defined therein) will not have voting rights
unless (a) the corporation's articles of incorporation or bylaws provide that
Chapter 42 does not apply to control share acquisitions of shares of the
corporation before the control share acquisition or (b) such voting rights are
granted pursuant to a shareholder resolution approved by (i) each voting group
entitled to vote separately on the resolution by a majority of votes entitled to
be cast by that voting group, with the holders of the outstanding shares of a
class being entitled to vote as a separate voting group if the proposed control
share acquisition would, if fully carried out, result in (A) an increase or
decrease in the aggregate number of authorized shares of the class, (B) effect
an exchange or reclassification of all or part of the shares of the class into
shares of another class, (C) effect an exchange or reclassification, or create
the right of exchange, of all or part of the shares of the class, (D) change the
designation, rights, preferences, or limitations of all or part of the shares of
the class, (E) change the shares of all or part of the class into a different
number of shares of the same class, (F) create a new class of shares having
rights or preferences with respect to distributions or to dissolution that are
prior, superior, or substantially equal to the shares of the class, (G) limit or
deny an existing preemptive right of all or part of the shares of the class or
(H) cancel or otherwise affect rights to distribution or dividends that have
accumulated but not yet been declared on all or part of the shares of the class
and (ii) each voting group entitled to vote separately on the proposal by a
majority of all the votes entitled to be cast by that group, excluding all
interested shares.
Any person who proposes to make or has made a control share acquisition
may at that person's election deliver an acquiring person statement to the
issuing public corporation at the issuing public corporation's principal office.
The acquiring person statement must set forth (i) the identity of the acquiring
person and each other member of any group of which the person is a part for
purposes of determining control shares, (ii) a statement that the acquiring
person statement is given pursuant to Chapter 42, (iii) the number of shares of
the issuing public corporation owned (directly or indirectly) by the acquiring
person and each other member of the group, (iv) the range of voting power under
which the control share acquisition falls or would, if consummated, fall, and
(v) if the control share acquisition has not taken place, (a) a description in
reasonable detail of the terms of the proposed control share acquisition and (b)
representations of the acquiring person, together with a statement in reasonable
detail of the facts upon which they are based, that the proposed control share
acquisition, if consummated, will not be contrary to law, and that the acquiring
person has the financial capacity to make the control share acquisition.
If requested by the acquiring person at the time of delivery of the
acquiring person statement, and if the acquiring person undertakes to pay the
corporation's expenses of a special meeting, the directors of the issuing public
corporation shall, within 10 days of that time, call a special meeting of
shareholders of the issuing public corporation for the purpose of considering
the voting rights to be accorded the shares acquired or to be acquired in the
control share acquisition. Such meeting shall be held within 50 days and, if
requested by the acquiring person, no sooner than 30 days, after receipt by the
issuing public corporation of the request, unless the acquiring person otherwise
agrees to another date. Further, if no request is made, the voting rights to be
accorded the shares acquired in the control share acquisition shall be presented
to the next special or annual meeting of the shareholders.
If authorized in a corporation's articles of incorporation or bylaws
before a control share acquisition has occurred, control shares acquired in a
control share acquisition with respect to which no acquiring person statement
has been filed with the issuing public corporation may, at any time during the
period ending 60 days after the last acquisition of control shares by the
acquiring person, be subject to redemption by the corporation at the fair market
value thereof pursuant to the procedures adopted by the corporation. Control
shares acquired in a control share acquisition are not subject to redemption
after an acquiring person statement has been filed unless the shares are not
accorded full voting rights by shareholders.
Further, unless otherwise provided in a corporation's articles of
incorporation or bylaws before a control share acquisition has occurred, in the
event control shares acquired in a control share acquisition are accorded full
voting rights and the acquiring person has acquired control shares with a
majority of more of all voting power, all shareholders of the issuing public
corporation have dissenters' rights to receive the fair value of their shares
pursuant to Chapter 44 of the IBCL, fair value meaning a value not less than the
highest price paid per share by the acquiring person in the control share
acquisition.
Chapter 43 of the IBCL prohibits an Indiana "resident domestic
corporation" such as CTS from engaging in a "business combination" (defined as a
variety of transactions, including mergers) with an "interested shareholder"
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(defined generally as a person that is the beneficial owner of 10% or more of a
corporation's outstanding voting stock) for a period of five years following the
date that such person became an interested shareholder unless (a) prior to the
date such person became an interested shareholder, the board of directors of the
corporation approved either the business combination or the transaction that
resulted in the shareholder becoming an interested shareholder or (b) the
proposed transaction meets numerous conditions relating to price, nature, timing
and consideration.
Under Chapter 43, the restrictions described above do not apply if,
among other things (a) the resident domestic corporation's original articles of
incorporation contains a provision expressly electing not to be governed by
Chapter 43; (b) the resident domestic corporation, by action of its
shareholders, adopts an amendment to its articles of incorporation or by-laws
expressly electing not to be governed by Chapter 43, provided that, in addition
to any other vote required by law, such amendment to the certificate of
incorporation or by-laws must be approved by the affirmative vote of a majority
of the shares entitled to vote, which amendment would not be effective until 18
months after the adoption of such amendment and would not apply to any business
combination between the resident domestic corporation and any person who became
an interested shareholder of the corporation on or prior to the date of such
adoption; or (c) the corporation does not have a class of voting stock that is
registered with the Commission under Section 12 of the Exchange Act, unless the
corporation's articles of incorporation provide otherwise; or (d) a shareholder
becomes an interested shareholder "inadvertently" and thereafter divests itself
of a sufficient number of shares so that such shareholder ceases to be an
interested shareholder. Under Chapter 43, the restrictions described above also
do not apply to certain business combinations proposed by an interested
shareholder following the announcement or notification of one of certain
extraordinary transactions involving the corporation and an interested
shareholder with the approval of a majority of the resident domestic
corporation's directors.
The foregoing summary of Chapters 42 and 43 does not purport to be
complete and is qualified in its entirety by reference to the provisions of
Chapters 42 and 43.
The Purchaser does not believe that any takeover statutes are
applicable to the Merger and has not attempted to comply with any state takeover
statutes in connection with the Merger. The Purchaser reserves the right to
challenge the validity or applicability of any state law allegedly applicable to
the Merger and nothing in this Offer to Purchase nor any action taken in
connection herewith is intended as a waiver of that right.
ANTITRUST. Under the HSR Act and the rules that have been promulgated
thereunder, certain acquisition transactions may not be consummated unless
certain information has been furnished to the Antitrust Division and the FTC and
certain waiting period requirements have been satisfied. The acquisition of
Shares pursuant to the Offer is subject to such requirements. See Section 2.
The Parent intends to file on the date hereof with the FTC and the
Antitrust Division a Premerger Notification and Report Form in connection with
the purchase of Shares pursuant to the Offer. Under the provisions of the HSR
Act applicable to the Offer, the purchase of Shares pursuant to the Offer may
not be consummated until the expiration of a 15-calendar day waiting period
following the filing by the Parent and notification to the Company of such
filing. Accordingly, it is expected that the waiting period under the HSR Act
applicable to the Offer will expire at 11:59 p.m., New York City time, on
Tuesday, April 15, 1997, unless, prior to the expiration or termination of the
waiting period, the FTC or the Antitrust Division extends the waiting period by
requesting additional information or documentary material from the Parent. If
either the FTC or the Antitrust Division were to request additional information
or documentary material from the Parent, the waiting period would expire at
11:59 p.m., New York City time, on the tenth calendar day after the date of
substantial compliance by the Parent with such request. Thereafter, the waiting
period could be extended by court order or by consent of the Parent. The waiting
period under the HSR Act may be terminated by the FTC and the Antitrust Division
prior to its expiration. If the acquisition of Shares is delayed pursuant to a
request by the FTC or the Antitrust Division for additional information or
documentary material pursuant to the HSR Act, the Offer may, but need not, be
extended and in any event the purchase of and payment for Shares will be
deferred until ten days after the request is substantially complied with, unless
the waiting period is sooner terminated by the FTC and the Antitrust Division.
See Section 2. Only one extension of such waiting period pursuant to a request
for additional information is authorized by the HSR Act and the rules
promulgated thereunder, except by court order or by consent of the Parent. Any
such extension of the waiting period will not give rise to any withdrawal rights
not otherwise provided for by applicable law. See Section 4. Although the
Company is required to file certain information and documentary material with
the Antitrust Division
-26-
<PAGE>
and the FTC in connection with the Offer, neither the Company's failure to make
such filings nor a request from the Antitrust Division or the FTC for additional
information or documentary material made to the Company will extend the waiting
period.
The FTC and the Antitrust Division frequently scrutinize the legality
under the antitrust laws of transactions such as the proposed acquisition of
Shares by Purchaser pursuant to the Offer. At any time before or after the
purchase by Purchaser of Shares pursuant to the Offer, either of the FTC or the
Antitrust Division could take such action under the antitrust laws as it deems
necessary or desirable in the public interest, including seeking to enjoin the
purchase of Shares pursuant to the Offer or seeking the divestiture of Shares
purchased by Purchaser or the divestiture of substantial assets of the Parent,
its subsidiaries or the Company. Private parties and state attorneys general may
also bring legal action under federal or state antitrust laws under certain
circumstances.
Based upon an examination of publicly available information relating to
the businesses in which the Company is engaged, Purchaser believes that the
acquisition of Shares pursuant to the Offer and the Merger would not violate
antitrust laws. Purchaser believes that retention of all of the operations of
the Company and Purchaser should be permitted under the antitrust laws.
Nevertheless, there can be no assurance that a challenge to the Offer on
antitrust grounds will not be made, or, if such challenge is made, what the
result will be.
15. FEES AND EXPENSES.
Purchaser has retained Georgeson & Company Inc. to act as the
Information Agent in connection with the Offer. The Information Agent may
contact holders of Shares by mail, telephone, facsimile, telegraph and personal
interviews and may request brokers, dealers and other nominee shareholders to
forward materials relating to the Offer to beneficial owners of Shares. The
Information Agent will receive reasonable and customary compensation for its
services, will be reimbursed for certain reasonable out-of-pocket expenses and
will be indemnified against certain liabilities and expenses in connection
therewith, including certain liabilities under the federal securities laws.
In addition, Harris Trust Company of New York has been retained as the
Depositary. The Depositary has not been retained to make solicitations or
recommendations in its role as Depositary. The Depositary will receive
reasonable and customary compensation for its services, will be reimbursed for
certain reasonable out-of-pocket expenses and will be indemnified against
certain liabilities and expenses in connection therewith, including certain
liabilities under the federal securities laws.
Except as set forth above, Purchaser will not pay any fees or
commissions to any broker or dealer or any other person for soliciting tenders
of Shares pursuant to the Offer. Brokers, dealers, commercial banks and trust
companies will, upon request only, be reimbursed by Purchaser for customary
mailing and handling expenses incurred by them in forwarding material to their
customers.
16. MISCELLANEOUS.
Purchaser is not aware of any jurisdiction where the making of the
Offer is prohibited by any administrative or judicial action pursuant to any
valid state statute. If Purchaser becomes aware of any valid state statute
prohibiting the making of the Offer or the acceptance of the Shares pursuant
thereto, Purchaser will make a good faith effort to comply with such state
statute. If, after such good faith effort, Purchaser cannot comply with any such
state statute, the Offer will not be made to (nor will tenders be accepted from
or on behalf of) the holders of Shares in such state. In any jurisdiction where
the securities, blue sky or other laws require the Offer to be made by a
licensed broker or dealer, the Offer shall be deemed to be made on behalf of
Purchaser by one or more registered brokers or dealers which are licensed under
the laws of such jurisdiction.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATION ON BEHALF OF PARENT OR PURCHASER NOT CONTAINED IN THIS OFFER TO
PURCHASE OR IN THE LETTER OF TRANSMITTAL AND, IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED.
-27-
<PAGE>
Parent and Purchaser have filed with the SEC the Schedule 14D-1,
together with exhibits, pursuant to Rule 14d-3 of the General Rules and
Regulations under the Exchange Act, furnishing certain additional information
with respect to the Offer. The Schedule 14D-1, and any amendments thereto, may
be inspected at, and copies may be obtained from, the same places and in the
same manner as set forth in Section 7 (except that they will not be available at
the regional offices of the SEC).
SB ACQUISITION CORP.
March 31, 1997
-28-
<PAGE>
SCHEDULE I
INFORMATION CONCERNING DIRECTORS AND EXECUTIVE
OFFICERS OF PARENT AND PURCHASER
DIRECTORS AND EXECUTIVE OFFICERS OF PARENT. The following table sets
forth the name, business address, present principal occupation, and employment
and material occupations, positions, offices, or employments for the past five
years of certain directors, officers and employees of Parent. Unless otherwise
indicated, the principal business address of each executive officer of Parent is
110 East 59th Street, New York, NY 10022 and each occupation set forth opposite
an individual's name refers to employment with Parent. Where no date is given
for the commencement of the indicated office or position, such office or
position was assumed prior to March 31, 1992. Each person listed below is a
citizen of the United States.
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION OR
NAME AND PRINCIPAL EMPLOYMENT; MATERIAL POSITIONS
BUSINESS ADDRESS HELD DURING THE PAST FIVE YEARS
- -------------------------------------------------- --------------------------------------------------------------
<S> <C>
Neil D. Arnold.................................. Director. Executive Vice President, Corporate
Varity Corporation Development since April 1996 and Chief Financial
672 Delaware Avenue Officer of Varity Corporation, a manufacturer of
Buffalo, NY 14209 automotive components and diesel engines.
Paul W. Bucha................................... Director. President, Paul W. Bucha & Company, Inc.,
Paul W. Bucha and Company, Inc. an international marketing consulting firm; President,
Foot of Chapel Avenue BLHJ, Inc., an international consulting firm; President,
Jersey City, NJ 07305 Congressional Medal of Honor Society of U.S. since
September 1995
Frederick G. Chbosky............................ Chief Financial Officer; Executive Vice President -
Finance of Wheeling-Pittsburgh Steel Corporation
("WPSC") since December 1992 and Chief Financial
Officer of WPSC
Robert A. Davidow............................... Director. Private Investor; Director, Arden Group,
11601 Wilshire Boulevard Inc.
Suite 1940
Los Angeles, CA 90025
William Goldsmith............................... Director. Management and Marketing Consultant;
Fiber Fuel International, Inc. Chairman and Chief Executive Officer of Overspin
221 Executive Circle Golf, since January 1994; Chairman of the Board and
Suite II Chief Executive Officer of Fiber Fuel International,
Savannah, GA 31406 Inc., since 1994
Ronald LaBow.................................... Director. Chairman of the Board; President, Stonehill
Investment Corp.; Director of Regency Equities Corp.,
a real estate company
Howard Mileaf................................... Vice President, Special Counsel since April 1993;
Trustee/Director of Neuberger & Berman Equity
Mutual Funds
Marvin L. Olshan................................ Director. Secretary; Partner, Olshan Grundman Frome
Olshan Grundman Frome & & Rosenzweig LLP
Rosenzweig LLP
505 Park Avenue
New York, NY 10022
</TABLE>
-29-
<PAGE>
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION OR
NAME AND PRINCIPAL EMPLOYMENT; MATERIAL POSITIONS
BUSINESS ADDRESS HELD DURING THE PAST FIVE YEARS
- -------------------------------------------------- --------------------------------------------------------------
<S> <C>
John R. Scheessele.............................. Director, President and Chief Executive Officer;
President, Chief Executive Officer and Chairman of
the Board of WPSC
Garin Smith..................................... Vice President since October 1995; President and
Chief Executive Offer of Unimast Incorporated, a
wholly- owned subsidiary of WHX
Raymond S. Troubh............................... Director. Financial Consultant; Director of ADT 10 Rockefeller Plaza
Limited, a provider of electronic security alarm Suite 712 protection,
America West Airlines, Inc., Applied New York, NY 10021 Power Inc., a
manufacturer and distributor of hydraulic power equipment, ARIAD
Pharmaceuticals, Inc., Becton, Dickinson and Company, a medical
instrumentation and equipment company, Diamond Offshore Drilling, Inc.,
Foundation Health Corporation, General American Investors Company.
Olsten Corporation, a temporary help company, Petrie Stores Corporation,
a retail chain, Sunbean Corporation, a manufacturer of consumer
appliances, Time Warner Inc. and Triarc Companies, Inc.
Lynn Williams................................... Director. Retired President of United Steelworkers of
1829 Duffield Lane America
Alexandria, VA 22307
Stewart E. Tabin................................ Assistant Treasurer; Vice President of Stonehill
Investment Corp.
Neale X. Trangucci.............................. Assistant Treasurer; Vice President, Stonehill
Investment Corp.
</TABLE>
-30-
<PAGE>
DIRECTORS AND EXECUTIVE OFFICERS OF PURCHASER. Set forth below are the
name and position with Purchaser of each director and executive officer of
Purchaser. The principal address of Purchaser and the current business address
of each individual listed below is 110 East 59th Street, New York, NY 10022.
Each such person is a citizen of the United States. The present principal
occupation or employment (in addition to the position with Purchaser indicated
below), and material occupations, positions, offices or employments for the past
five years of each person is set forth above.
<TABLE>
<CAPTION>
PRESENT POSITION
NAME WITH PURCHASER
- ------------------------------------------------ ---------------------------------------------------------
<S> <C>
Ronald LaBow.................................. Director; President
Howard Mileaf................................. Director; Vice-President
Stewart E. Tabin.............................. Director; Vice-President; Treasurer
Neale X. Trangucci............................ Director; Secretary
</TABLE>
-31-
<PAGE>
SCHEDULE II
INFORMATION CONCERNING THE PROPOSED DIRECTORS
The following table sets forth the name, business address, present
principal occupation, and employment and material occupations, positions,
offices, or employments for the past five years of each person proposed by the
Purchase to be a director of the Company. The principal business address of each
of the persons set forth below is 110 East 59th Street, New York, NY 10022. Each
occupation or employment and material occupations, positions, officers or
employments for the past five years of each person is set forth in Schedule I.
Each person listed below is a citizen of the United States.
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION OR
NAME AND CURRENT EMPLOYMENT; MATERIAL POSITIONS
BUSINESS ADDRESS HELD DURING THE PAST FIVE YEARS
- ------------------------------------------- -----------------------------------------------------------------
<S> <C>
Ronald LaBow. . . . . . . . . . . . . . . . See Schedule I
Howard Mileaf. . . . . . . . . . . . . . . . See Schedule I
Stewart E. Tabin. . . . . . . . . . . . . . See Schedule I
Neale X. Trangucci....................... See Schedule I
</TABLE>
-32-
<PAGE>
SCHEDULE III
TRANSACTIONS IN THE SECURITIES OF THE COMPANY
The following table sets forth the transactions in shares by Parent and
the Purchaser in the past 60 days. Unless otherwise indicated, all of such
transactions took place on the NYSE.
<TABLE>
<CAPTION>
Shares of Common Stock Purchase Price Per Share Date of Purchase
- ------------------------------------- ------------------------------------- ------------------------------
<S> <C> <C> <C>
12,000 $29.66 March 4, 1997
2,000 $30.25 March 6, 1997
6,000 $31.46 March 10, 1997
80,000 $32.50 March 13, 1997
2,000 $32.75 March 17, 1997
1,800 $33.00 March 18, 1997
5,800 $33.12 March 24, 1997
</TABLE>
-33-
<PAGE>
Manually executed facsimile copies of the Letter of Transmittal,
properly completed and duly signed, will be accepted. The Letter of Transmittal,
certificates for the Shares and any other required documents should be sent by
each shareholder of the Company or his broker, dealer, commercial bank, trust
company or other nominee to the Depositary at one of its addresses set forth
below:
The Depositary for the Offer is:
HARRIS TRUST COMPANY OF NEW YORK
BY MAIL: BY OVERNIGHT COURIER: BY HAND:
Wall Street Station 77 Water Street, 4th Floor Receive Window
P.O. Box 1023 New York, NY 10005 77 Water Street, 5th Floor
New York, NY 10268-1023 New York, NY 10005
BY FACSIMILE TRANSMISSION:
(for Eligible Institutions Only)
(212) 701-7636 or 7637
FOR INFORMATION TELEPHONE (CALL COLLECT):
(212) 701-7624
Any questions or requests for assistance or additional copies of the
Offer to Purchase, the Letter of Transmittal and the Notice of Guaranteed
Delivery may be directed to the Information Agent or the Dealer Manager at their
respective telephone numbers and locations listed below. You may also contact
your broker, dealer, commercial bank or trust company or other nominee for
assistance concerning the Offer.
The Information Agent for the Offer is:
GEORGESON & COMPANY INC.
Wall Street Plaza
New York, New York 10005
Telephone: (212) 440-9800
or
CALL TOLL FREE: (800) 223-2064
LETTER OF TRANSMITTAL
TO TENDER SHARES OF COMMON STOCK (INCLUDING THE ASSOCIATED RIGHTS)
OF
DYNAMICS CORPORATION OF AMERICA
PURSUANT TO THE OFFER TO PURCHASE, DATED MARCH 31, 1997
BY
SB ACQUISITION CORP.,
A WHOLLY OWNED SUBSIDIARY
OF
WHX CORPORATION
- --------------------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME,
ON TUESDAY, APRIL 29, 1997, UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
The Depositary for the Offer is:
HARRIS TRUST COMPANY OF NEW YORK
By Mail: By Overnight Courier: By Hand:
Wall Street Station 77 Water Street, 4th Floor Receive Window
P.O. Box 1023 New York, NY 10005 77 Water Street, 5th Floor
New York, NY 10268-1023 New York, NY 10005
By Facsimile Transmission:
(for Eligible Institutions Only)
(212) 701-7636 or 7637
For Information Telephone (call collect):
(212) 701-7624
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE OR TELEX TRANSMISSION
OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST
SIGN THIS LETTER OF TRANSMITTAL WHERE INDICATED BELOW AND COMPLETE THE
SUBSTITUTE FORM W-9 PROVIDED BELOW.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL
SHOULD BE READ CAREFULLY BEFORE THIS LETTER
OF TRANSMITTAL IS COMPLETED.
THIS LETTER OF TRANSMITTAL IS TO BE COMPLETED BY SHAREHOLDERS OF
DYNAMICS CORPORATION OF AMERICA EITHER IF CERTIFICATES EVIDENCING SHARES (EACH
AS DEFINED BELOW) ARE TO BE FORWARDED HEREWITH, OR IF DELIVERY OF SHARES IS TO
BE MADE BY BOOK-ENTRY TRANSFER TO THE DEPOSITARY'S ACCOUNT AT THE DEPOSITORY
TRUST COMPANY OR THE PHILADELPHIA DEPOSITORY TRUST COMPANY (EACH A "BOOK-ENTRY
TRANSFER FACILITY") PURSUANT TO THE BOOK-ENTRY TRANSFER PROCEDURE DESCRIBED IN
"PROCEDURES FOR TENDERING SHARES" OF THE OFFER TO PURCHASE (AS DEFINED BELOW).
DELIVERY OF
<PAGE>
DOCUMENTS TO A BOOK-ENTRY TRANSFER FACILITY IN ACCORDANCE WITH SUCH BOOK-ENTRY
TRANSFER FACILITY'S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
/ / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY
TRANSFER TO THE DEPOSITARY'S ACCOUNT AT ONE OF THE BOOK-ENTRY TRANSFER
FACILITIES AND COMPLETE THE FOLLOWING:
Name of Tendering Institution:
-----------------------------------
CHECK BOX OF APPLICABLE BOOK-ENTRY TRANSFER FACILITY:
/ / DTC / / PDTC
Account Number:
------------------------------------------------------
Transaction Code Number: -----------------------------------------------
/ / CHECK HERE IF TENDERED SHARES ARE BEING TENDERED PURSUANT TO A NOTICE
OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE
THE FOLLOWING:
Name(s) of Registered Holder(s):
-------------------------------
Window Ticket Number (if any):
-------------------------------
Date of Execution of Notice of Guaranteed Delivery:
--------------
Name of Institution which Guaranteed Delivery:
-------------------
IF DELIVERED BY BOOK-ENTRY TRANSFER, CHECK BOX OF BOOK-ENTRY TRANSFER
FACILITY:
/ / DTC / / PDTC
Account Number:
------------------------------------------------------
Transaction Code Number: -----------------------------------------------
-2-
<PAGE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C>
Name(s) and Address(es) of Registered Holder(s) Share Certificate(s) Tendered
(Please fill in, if blank) (Attach Additional List if Necessary)
- -----------------------------------------------------------------------------------------------------------------------------
Total Number of Number of
Certificate Shares Represented Shares
Number(s)* By Certificate(s)* Tendered**
- -----------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------
---------------------------------------------------------------------
---------------------------------------------------------------------
---------------------------------------------------------------------
---------------------------------------------------------------------
---------------------------------------------------------------------
Total Shares
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares being
delivered to the Depositary are being tendered. See Instruction 4.
- --------------------------------------------------------------------------------
The names and addresses of the registered holders should be printed, if
not already printed above, exactly as they appear on the certificates
representing Shares tendered hereby. The certificates and number of
Shares that the undersigned wishes to tender should be indicated in the
appropriate boxes.
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE INSTRUCTIONS SET FORTH IN THIS LETTER OF TRANSMITTAL
CAREFULLY.
-3-
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to SB Acquisition Corp., a New York
corporation ("Purchaser") and a wholly owned subsidiary of WHX Corporation, a
Delaware corporation, the above described shares of common stock, par value $.10
per share (the "Shares") of Dynamics Corporation of America, a New York
corporation (the "Company"), including the associated Common Stock Purchase
Rights (the "Rights") issued pursuant to the Rights Agreement, dated as of
January 30, 1986, as amended on December 27, 1995, between the Company and First
National Bank of Boston, as Rights Agent, at a price of $40 per Share, net to
the seller in cash, without interest thereon (the "Offer Price"), upon the terms
and subject to the conditions set forth in the Offer to Purchase, dated March
31, 1997 (the "Offer to Purchase"), and in the related Letter of Transmittal
(which, as amended from time to time, together constitute the "Offer"). UNLESS
THE CONTEXT REQUIRES OTHERWISE, ALL REFERENCES HEREIN TO THE SHARES SHALL
INCLUDE THE ASSOCIATED RIGHTS, AND ALL REFERENCES TO THE RIGHTS SHALL INCLUDE
ALL BENEFITS THAT MAY INURE TO THE HOLDERS OF THE RIGHTS PURSUANT TO THE RIGHTS
AGREEMENT.
Subject to, and effective upon, acceptance for payment of the Shares
tendered herewith, in accordance with the terms of the Offer (including, if the
Offer is extended or amended, the terms and conditions of any such extension or
amendment), the undersigned hereby sells, assigns and transfers to, or upon the
order of, Purchaser all right, title and interest in and to all the Shares that
are being tendered hereby (and any and all non-cash dividends, distributions,
rights, other Shares or other securities issued or issuable in respect thereof
or declared, paid or distributed in respect of such Shares on or after March 14,
1996 (collectively, "Distributions")), purchased pursuant to the Offer and
irrevocably appoints the Depositary the true and lawful agent and
attorney-in-fact of the undersigned with respect to such Shares and all
Distributions, with full power of substitution (such power of attorney being
deemed to be an irrevocable power coupled with an interest), to (i) deliver
certificates for such Shares (individually, a "Share Certificate") and all
Distributions, or transfer ownership of such Shares and all Distributions on the
account books maintained by the Book-Entry Transfer Facility, together, in
either case, with all accompanying evidence of transfer and authenticity to, or
upon the order of Purchaser, (ii) present such Shares and all Distributions for
transfer on the books of the Company, and (iii) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Shares and all
Distributions, all in accordance with the terms of the Offer.
By executing this Letter of Transmittal, the undersigned irrevocably
appoints Ronald LaBow and Stewart E. Tabin as proxies of the undersigned, each
with full power of substitution, to vote in such manner as each such attorney
and proxy or his substitute shall, in his sole discretion, deem proper, and
otherwise to act (including pursuant to written consent) with respect to all the
Shares tendered hereby that have been accepted for payment by the Purchaser
prior to the time of such vote or action (and all Distributions of said Shares
on or after March 14, 1997) which the undersigned is entitled to vote or consent
with respect to at any meeting of stockholders of the Company, whether annual or
special, and whether or not an adjourned meeting (including without limitation
the 1997 Annual Meeting of the Shareholders of the Company scheduled to be held
on May 2, 1997). THIS PROXY IS IRREVOCABLE and is granted in consideration of,
and is effective upon, the acceptance for payment of such Shares by the
Purchaser in accordance with the terms of the Offer. Such acceptance for payment
shall revoke any other proxy granted by the undersigned at any time with respect
to such Shares (and any other such Shares or securities) and no subsequent
proxies will be given (and if given will be deemed not to be effective) with
respect thereto by the undersigned.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, sell, assign and transfer the Shares
tendered hereby and all Distributions, that the undersigned own(s) the Shares
tendered hereby and that, when such Shares are accepted for payment by
Purchaser, Purchaser will acquire good, marketable and unencumbered title
thereto and to all Distributions, free and clear of all liens, restrictions,
charges and encumbrances, and that none of such Shares and Distributions will be
subject to any adverse claim. The undersigned, upon request, shall execute and
deliver all additional documents deemed by the Depositary or Purchaser to be
necessary or desirable to complete the sale, assignment and transfer of the
Shares tendered hereby and all Distributions. In addition, the undersigned shall
remit and transfer promptly to the Depositary for the account of
-4-
<PAGE>
Purchaser all Distributions in respect of the Shares tendered hereby,
accompanied by appropriate documentation of transfer, and, pending such
remittance and transfer or appropriate assurance thereof, Purchaser shall be
entitled to all rights and privileges as owner of each such Distribution and may
withhold the entire purchase price of the Shares tendered hereby or deduct from
such purchase price, the amount or value of such Distribution as determined by
Purchaser in its sole discretion.
No authority herein conferred or agreed to be conferred shall be
affected by, and all such authority shall survive, the death or incapacity of
the undersigned. All obligations of the undersigned hereunder shall be binding
upon the heirs, executors, personal and legal representatives, administrators,
trustees in bankruptcy, successors and assigns of the undersigned. Except as
stated in the Offer to Purchase, this tender is irrevocable.
The undersigned understands that tenders of Shares pursuant to any one
of the procedures described in "Procedures for Tendering Shares" of the Offer to
Purchase and in the Instructions hereto will constitute the undersigned's
acceptance of the terms and conditions of the Offer. Purchaser's acceptance for
payment of Shares tendered pursuant to the Offer will constitute a binding
agreement between the undersigned and Purchaser upon the terms and subject to
the conditions of the Offer. The undersigned recognizes that under certain
circumstances set forth in the Offer to Purchase, Purchaser may not be required
to accept for payment any of the Shares tendered hereby.
Unless otherwise indicated herein in the box entitled "Special Payment
Instructions," please issue the check for the purchase price and/or return any
certificates evidencing Shares not tendered or accepted for payment, in the
name(s) of the registered holder(s) appearing above under "Description of Shares
Tendered." Similarly, unless otherwise indicated in the box entitled "Special
Delivery Instructions," please mail the check for the purchase price and/or
return any certificates evidencing Shares not tendered or accepted for payment
(and accompanying documents, as appropriate) to the address(es) of the
registered holder(s) appearing above under "Description of Shares Tendered." In
the event that the box entitled "Special Payment Instructions" and/or "Special
Delivery Instructions" are completed, please issue the check for the purchase
price and/or return any certificates for Shares not purchased or not tendered or
accepted for payment in the name(s) of, and/or mail such check and/or return
such certificates to, the person(s) so indicated. Unless otherwise indicated
herein in the box entitled "Special Payment Instructions," please credit any
Shares tendered hereby and delivered by book-entry transfer, but which are not
purchased, by crediting the account at the Book-Entry Transfer Facility
designated above. The undersigned recognizes that Purchaser has no obligation,
pursuant to the Special Payment Instructions, to transfer any Shares from the
name of the registered holder(s) thereof if Purchaser does not accept for
payment any of the Shares tendered hereby.
-5-
<PAGE>
<TABLE>
<CAPTION>
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<S> <C>
SPECIAL PAYMENT INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS (SEE
INSTRUCTIONS 1, 5, 6 AND 7 OF THIS (SEE INSTRUCTIONS 1, 5, 6 AND 7 OF THIS
LETTER OF TRANSMITTAL) LETTER OF TRANSMITTAL)
To be completed ONLY if certificates for Shares not To be completed ONLY if certificates for Shares not
tendered or not purchased and/or the check for the tendered or not purchased and/or the check for the
purchase price of Shares purchased are to be issued in purchase price of Shares purchased are to be sent to
the name of someone other than the undersigned. someone other than the undersigned, or to the undersigned
at an address other than that shown above.
Issue check and/or certificates to:
Name:__________________________________
(PLEASE PRINT) Mail check and/or certificates to:
Address:________________________________ Name:__________________________________
(Include Zip Code) (PLEASE PRINT)
Address:_______________________________
Taxpayer Identification or Social Security Number (INCLUDE ZIP CODE)
(See Substitute Form W-9 on reverse)
- --------------------------------------------------------- ---------------------------------------------------------
</TABLE>
-6-
<PAGE>
RECORD OWNERSHIP AS OF MARCH 14, 1997
(SEE INSTRUCTION 10)
- --------------------------------------------------------------------------------
/ / The Shares tendered hereby were owned of record by the undersigned as
of the close of business on March 14, 1997.
/ / The undersigned has obtained, and the Shares tendered hereby are
accompanied by, a valid irrevocable proxy to vote such Shares in
connection with their purchase (i) directly from the stockholder of
record as of the close of business on March 14, 1997; or (ii) pursuant
to a chain of purchasers from the stockholder of record as of the close
of business on March 14, 1997 whereby each successive purchaser through
and including the stockholder tendering Shares to the Purchaser, has
obtained a valid, irrevocable proxy to vote such Shares from the prior
owner of such Shares.
/ / The undersigned does not meet the criteria necessary to check either
statement above, but has obtained, and the Shares tendered hereby are
accompanied by, a proxy or proxies duly executed by the owner of record
of the Shares as of the close of business on March 14, 1997, in favor
of the undersigned.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SIGN HERE
(COMPLETE SUBSTITUTE FORM W-9 ON REVERSE)
-----------------------------------
(SIGNATURE(S) OF HOLDER(S)
Dated: , 1997
--------------
(Must be signed by registered holder(s) exactly as name(s) appear(s) on share
certificate(s) or on a security position listing or by person(s) authorized to
become registered holder(s) by certificates and documents transmitted herewith.
If signature is by trustees, executors, administrators, guardians,
attorneys-in-fact, officers of corporations or others acting in a fiduciary or
representative capacity, please provide the following information. See
Instruction 5 of this Letter of Transmittal.)
Name(s):
-----------------------------------------------------------------
(PLEASE PRINT)
Capacity (full title):
---------------------------------------------------
Address:
----------------------------------------------------------------
(INCLUDE ZIP CODE)
Area Code and Telephone Number:
------------------------------------------
Tax Identification or Social Security Number:
----------------------------
(COMPLETE SUBSTITUTE FOR W-9 ON REVERSE)
- --------------------------------------------------------------------------------
-7-
<PAGE>
- --------------------------------------------------------------------------------
GUARANTEE OF SIGNATURE(S)
(SEE INSTRUCTIONS 1 AND 5 OF THIS LETTER OF TRANSMITTAL)
Authorized Signature:
-------------------------------------------------
Name:
-----------------------------------------------------------------
(PLEASE PRINT)
Title:
----------------------------------------------------------------
Name of Firm:
---------------------------------------------------------
Address:--------------------------------------------------------------
(INCLUDE ZIP CODE)
Area Code and Telephone Number:
---------------------------------------
Dated: , 1997
------------------
- --------------------------------------------------------------------------------
-8-
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a firm which is a
bank, broker, dealer, credit union, savings association, or other entity that is
a member in good standing of the Securities Transfer Agents Medallion Program
(each, an "Eligible Institution"). No signature guarantee is required on this
Letter of Transmittal (i) if this Letter of Transmittal is signed by the
registered holder(s) (which term, for purposes of this document, shall include
any participant in the Book-Entry Transfer Facility whose name appears on a
security position listing as the owner of Shares) of Shares tendered herewith,
unless such holder(s) has completed either the box entitled "Special Delivery
Instructions" or the box entitled "Special Payment Instructions" included
herein, or (ii) if such Shares are tendered for the account of an Eligible
Institution. See Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND SHARE CERTIFICATES. This
Letter of Transmittal is to be used either if certificates evidencing Shares
("Certificates") are to be forwarded herewith or if Shares are to be delivered
by book-entry transfer pursuant to the procedure set forth in "Procedures for
Tendering Shares" of the Offer to Purchase. Certificates evidencing all tendered
Shares, or confirmation of a book-entry transfer of such Shares, if such
procedure is available, into the Depositary's account at a Book-Entry Transfer
Facility pursuant to the procedures set forth in "Procedures for Tendering
Shares" of the Offer to Purchase, together with a properly completed and duly
executed Letter of Transmittal (or facsimile thereof) with any required
signature guarantees (or, in the case of a book-entry transfer, an Agent's
Message, as defined below) and any other documents required by this Letter of
Transmittal, must be received by the Depositary at one of its addresses set
forth herein prior to the Expiration Date (as defined in "Terms of the Offer;
Proration; Expiration Date" of the Offer to Purchase). If Certificates are
forwarded to the Depositary in multiple deliveries, a properly completed and
duly executed Letter of Transmittal must accompany each such delivery.
Shareholders whose Certificates are not immediately available, who cannot
deliver their Certificates and all other required documents to the Depositary
prior to the Expiration Date or who cannot complete the procedure for delivery
by book-entry transfer on a timely basis may tender their Shares pursuant to the
guaranteed delivery procedure described in "Procedures for Tendering Shares" of
the Offer to Purchase. Pursuant to such procedure: (i) such tender must be made
by or through an Eligible Institution; (ii) a properly completed and duly
executed Notice of Guaranteed Delivery, substantially in the form provided by
Purchaser herewith, must be received by the Depositary prior to the Expiration
Date; and (iii) in the case of a guarantee of Shares, the Certificates, in
proper form for transfer, or a confirmation of a book-entry transfer of such
Shares, if such procedure is available, into the Depositary's account at a
Book-Entry Transfer Facility, together with a properly completed and duly
executed Letter of Transmittal (or manually signed facsimile thereof) with any
required signature guarantees (or, in the case of a book-entry transfer, an
Agent's Message), and any other documents required by this Letter of
Transmittal, must be received by the Depositary within three New York Stock
Exchange, Inc. trading days after the date of execution of the Notice of
Guaranteed Delivery, all as described in "Procedures for Tendering Shares" of
the Offer to Purchase.
THE METHOD OF DELIVERY OF THIS LETTER OF TRANSMITTAL, CERTIFICATES AND ALL
OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH ANY BOOK-ENTRY TRANSFER
FACILITY, IS AT THE SOLE OPTION AND RISK OF THE TENDERING SHAREHOLDER, AND THE
DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY. IF
DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY
INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO
ENSURE TIMELY DELIVERY.
-9-
<PAGE>
No alternative, conditional or contingent tenders will be accepted and
no fractional Shares will be purchased. By execution of this Letter of
Transmittal (or a facsimile hereof), all tendering shareholders waive any right
to receive any notice of the acceptance of their Shares for payment.
3. INADEQUATE SPACE. If the space provided herein under "Description
of Shares Tendered" is inadequate, the Certificate numbers, the number of Shares
evidenced by such Certificates and the number of Shares tendered should be
listed on a separate schedule and attached hereto.
4. PARTIAL TENDERS. (Not applicable to shareholders who tender by
book-entry transfer.) If fewer than all the Shares evidenced by any Certificate
delivered to the Depositary herewith are to be tendered hereby, fill in the
number of Shares which are to be tendered in the box entitled "Number of Shares
Tendered." In such cases, new Certificate(s) evidencing the remainder of the
Shares that were evidenced by the Certificates delivered to the Depositary
herewith will be sent to the person(s) signing this Letter of Transmittal,
unless otherwise provided in the box entitled "Special Delivery Instructions,"
as soon as practicable after the expiration or termination of the Offer. All
Shares evidenced by Certificates delivered to the Depositary will be deemed to
have been tendered unless otherwise indicated.
5. SIGNATURES ON LETTER OF TRANSMITTAL; STOCK POWERS AND ENDORSEMENTS.
If this Letter of Transmittal is signed by the registered holder(s) of the
Shares tendered hereby, the signature(s) must correspond with the name(s) as
written on the face of the Certificates evidencing such Shares without
alteration, enlargement or any other change whatsoever.
If any Shares tendered hereby is owned of record by two or more
persons, all such persons must sign this Letter of Transmittal.
If any of the Shares tendered hereby are registered in the names of
different holders, it will be necessary to complete, sign and submit as many
separate Letters of Transmittal as there are different registrations of such
certificates.
If this Letter of Transmittal is signed by the registered holder(s) of
the Shares tendered hereby, no endorsements of Certificates or separate stock
powers are required, unless payment is to be made to, or Certificates evidencing
Shares not tendered or not purchased are to be issued in the name of, a person
other than the registered holder(s), in which case, the Certificate(s)
evidencing the Shares tendered hereby must be endorsed or accompanied by
appropriate stock powers, in either case signed exactly as the name(s) of the
registered holder(s) appear(s) on such Certificate(s). Signatures on such
Certificate(s) and stock powers must be guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares tendered hereby, the Certificate(s) tendered
hereby must be endorsed or accompanied by appropriate stock powers, in either
case signed exactly as the name(s) of the registered holder(s) appear(s) on such
Certificate(s). Signatures on such Certificate(s) and stock powers must be
guaranteed by an Eligible Institution.
If this Letter of Transmittal or any Certificate(s) or stock power is
signed by a trustee, executor, administrator, guardian, attorney-in-fact,
officer of a corporation or other person acting in a fiduciary or representative
capacity, such person should so indicate when signing, and proper evidence
satisfactory to Purchaser of such person's authority so to act must be
submitted.
6. STOCK TRANSFER TAXES. Except as otherwise provided in this
Instruction 6, Purchaser will pay all stock transfer taxes with respect to the
sale and transfer of any Shares to it or its order pursuant to the Offer. If,
however, payment of the purchase price of any Shares purchased is to be made to,
or Certificate(s) evidencing Shares not tendered or not purchased are to be
issued in the name of, a person other than the registered holder(s), the amount
of any stock transfer taxes (whether imposed on the registered holder(s), such
other person or otherwise)
-10-
<PAGE>
payable on account of the transfer to such other person will be deducted from
the purchase price of such Shares purchased, unless evidence satisfactory to
Purchaser of the payment of such taxes, or exemption therefrom, is submitted.
EXCEPT AS PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY FOR
TRANSFER TAX STAMPS TO BE AFFIXED TO THE CERTIFICATE(S) EVIDENCING THE SHARES
TENDERED HEREBY.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If a check for the
purchase price of any Shares tendered hereby is to be issued, or Certificate(s)
evidencing Shares not tendered or not purchased are to be issued, in the name of
a person other than the person(s) signing this Letter of Transmittal or if such
check or any such Certificate is to be sent to someone other than the person(s)
signing this Letter of Transmittal or to the person(s) signing this Letter of
Transmittal but at an address other than that shown in the box entitled
"Description of Shares Tendered," the appropriate boxes on this Letter of
Transmittal must be completed. Shares tendered hereby by book-entry transfer may
request that Shares not purchased be credited to such account maintained at the
Book-Entry Transfer Facility as such shareholder may designate in the box
entitled "Special Payment Instructions" on the reverse hereof. If no such
instructions are given, all such Shares not purchased will be returned by
crediting the account at the Book-Entry Transfer Facility as the account from
which such Shares were delivered.
8. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Requests for
assistance may be directed to the Information Agent at their respective
addresses or telephone numbers set forth herein. Additional copies of the Offer
to Purchase, this Letter of Transmittal, the Notice of Guaranteed Delivery and
the Guidelines for Certification of Taxpayer Identification Number on Substitute
Form W-9 may be obtained from the Information Agent or from brokers, dealers,
commercial banks or trust companies.
9. SUBSTITUTE FORM W-9. Each tendering shareholder is required to
provide the Depositary with a correct Taxpayer Identification Number ("TIN") on
the Substitute Form W-9 which is provided under "Important Tax Information"
below, and to certify, under penalties of perjury, that such number is correct
and that such shareholder is not subject to backup withholding of federal income
tax. If a tendering shareholder has been notified by the Internal Revenue
Service that such shareholder is subject to backup withholding, such shareholder
must cross out item (2) of the Certification box of the Substitute Form W-9,
unless such shareholder has since been notified by the Internal Revenue Service
that such shareholder is no longer subject to backup withholding. Failure to
provide the information on the Substitute Form W-9 may subject the tendering
shareholder to 31% federal income tax withholding on the payment of the purchase
price of all Shares purchased from such shareholder. If the tendering
shareholder has not been issued a TIN and has applied for one or intends to
apply for one in the near future, such shareholder should write "Applied For" in
the space provided for the TIN in Part I of the Substitute Form W-9, and sign
and date the Substitute Form W-9. If "Applied For" is written in Part I and the
Depositary is not provided with a TIN within 60 days, the Depositary will
withhold 31% on all payments of the purchase price to such shareholder until a
TIN is provided to the Depositary.
10. RECORD OWNERSHIP OF SHARES AS OF MARCH 14, 1997. A tendering
stockholder must check one of the three statements contained in the box entitled
"Record Ownership as of March 14, 1997" in order to validly tender Shares. If
the second or third statement is checked, the Shares must be accompanied by a
proxy, either in the form recommended by the Purchaser in Section 1 of the Offer
to Purchase or in a form otherwise acceptable to the Purchaser, which is signed
by the holder of record of the Shares as of March 14, 1997. In the event that
the second statement is checked and Shares have been transferred of record more
than once since March 14, 1997, proxies signed by each transferor of the Shares
must be submitted with this Letter of Transmittal. Each proxy submitted herewith
should irrevocably appoint the transferee of the Shares as the attorney and
proxy of the transferor.
-11-
<PAGE>
11. LOST, DESTROYED OR STOLEN CERTIFICATES. If any certificate(s)
representing Shares has been lost, destroyed or stolen, the shareholder should
promptly notify the Depositary. The shareholder will then be instructed as to
the steps that must be taken in order to replace the certificate(s). This Letter
of Transmittal and related documents cannot be processed until the procedures
for replacing lost or destroyed certificates have been followed.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A MANUALLY SIGNED FACSIMILE
HEREOF), PROPERLY COMPLETED AND DULY EXECUTED, WITH ANY REQUIRED SIGNATURE
GUARANTEES, OR AN AGENT'S MESSAGE (TOGETHER WITH SHARE CERTIFICATES OR
CONFIRMATION OF BOOK-ENTRY TRANSFER AND ALL OTHER REQUIRED DOCUMENTS) OR A
PROPERLY COMPLETED AND DULY EXECUTED NOTICE OF GUARANTEED DELIVERY MUST BE
RECEIVED BY THE DEPOSITARY PRIOR TO THE EXPIRATION DATE (AS DEFINED IN THE OFFER
TO PURCHASE).
-12-
<PAGE>
IMPORTANT TAX INFORMATION
Under the federal income tax law, a shareholder whose tendered Shares
are accepted for payment is required by law to provide the Depositary (as payer)
with such shareholder's correct TIN on Substitute Form W-9 below. If such
shareholder is an individual, the TIN is such shareholder's social security
number. If the Depositary is not provided with the correct TIN, the shareholder
may be subject to a $50 penalty imposed by the Internal Revenue Service. In
addition, payments that are made to such shareholder with respect to Shares
purchased pursuant to the Offer may be subject to backup withholding of 31%.
Certain shareholders (including, among others, all corporations and
certain foreign individuals) are not subject to these backup withholding and
reporting requirements. In order for a foreign individual to qualify as an
exempt recipient, such individual must submit a statement, signed under
penalties of perjury, attesting to such individual's exempt status. Forms of
such statements can be obtained from the Depositary. See the enclosed Guidelines
for Certification of Taxpayer Identification Number on Substitute Form W-9 for
additional instructions.
If backup withholding applies with respect to a shareholder, the
Depositary is required to withhold 31% of any payments made to such shareholder.
Backup withholding is not an additional tax. Rather, the tax liability of
persons subject to backup withholding will be reduced by the amount of tax
withheld. If withholding results in an overpayment of taxes, a refund may be
obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9
To prevent backup withholding on payments that are made to a
shareholder with respect to Shares purchased pursuant to the Offer, the
shareholder is required to notify the Depositary of such shareholder's correct
TIN by completing the form below certifying (a) that the TIN provided on
Substitute Form W-9 is correct (or that such shareholder is awaiting a TIN), and
(b) that (i) such shareholder has not been notified by the Internal Revenue
Service that such shareholder is subject to backup withholding as a result of a
failure to report all interest or dividends or (ii) the Internal Revenue Service
has notified such shareholder that such shareholder is no longer subject to
backup withholding.
WHAT NUMBER TO GIVE THE DEPOSITARY
The shareholder is required to give the Depositary the social security
number or employer identification number of the record holder of the Shares
tendered hereby. If the Shares are in more than one name or are not in the name
of the actual owner, consult the enclosed Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9 for additional guidance on
which number to report. If the tendering shareholder has not been issued a TIN
and has applied for a number or intends to apply for a number in the near
future, the shareholder should write "Applied For" in the space provided for the
TIN in Part I, and sign and date the Substitute Form W-9. If "Applied For" is
written in Part I and the Depositary is not provided with a TIN within 60 days,
the Depositary will withhold 31% of all payments of the purchase price to such
shareholder until a TIN is provided to the Depositary.
-13-
<PAGE>
<TABLE>
<CAPTION>
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PAYER'S NAME: HARRIS TRUST COMPANY OF NEW YORK, AS DEPOSITARY
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C>
SUBSTITUTE PART I--PLEASE PROVIDE YOUR TIN IN THE BOX AT ______________________
FORM W-9 RIGHT AND CERTIFY BY SIGNING AND DATING BELOW. Social Security Number
Department of the Treasury OR
Internal Revenue Service
_________________________
Employer Identification
Number
(If awaiting TIN write
"Applied For")
- ----------------------------------------------------------------------------------------------------------------------------------
Payer's Request for PART II--For Payees Exempt From Backup Withholding, see the enclosed Guidelines
Taxpayer Identification and complete as instructed therein.
Number (TIN) CERTIFICATION--Under penalties of perjury, I certify that:
(1) The number shown on this form is my correct Taxpayer Identification
Number (or a Taxpayer Identification Number has not been issued to me and
either (a) I have mailed or delivered an application to receive
a Taxpayer Identification Number to the appropriate Internal Revenue
Service ("IRS") or Social Security administration office or (b) I
intend to mail or deliver an application in the near future. I
understand that if I do not provide a Taxpayer Identification Number
within sixty (60) days, 31% of all reportable payments made to me
thereafter will be withheld until I provide a number), and
(2) I am not subject to backup withholding because (a) I am exempt
from backup withholding, (b) I have not been notified by the IRS that I
am subject to backup withholding as a result of failure to report all
interest or dividends or (c) the IRS has notified me that I am no longer
subject to backup withholding.
CERTIFICATE INSTRUCTIONS--You must cross out item (2) above if you have been notified by
the IRS that you are subject to backup withholding because of under reporting
interest or dividends on your tax return. However, if after being notified by the IRS
that you were subject to backup withholding you received another notification from the
IRS that you are no longer subject to backup withholding, do not cross out item (2). (Also
see instructions in the enclosed Guidelines.)
- -----------------------------------------------------------------------------------------------------------------------------------
SIGNATURE: DATE: , 1997
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</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER.
PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
Questions and requests for assistance or additional copies of the Offer
to Purchase, Letter of Transmittal and other tender offer materials may be
directed to the Information Agent set forth below:
The Information Agent for the Offer is:
GEORGESON & COMPANY INC.
Wall Street Plaza
New York, New York 10005
(800) 223-2064 (Toll-Free)
Banks and Brokers Call: (212) 440-9800 (Collect)
-14-
NOTICE OF GUARANTEED DELIVERY
FOR
TENDER OF SHARES OF
COMMON STOCK
(INCLUDING THE ASSOCIATED RIGHTS)
OF
DYNAMICS CORPORATION OF AMERICA
TO
SB ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
WHX CORPORATION
(NOT TO BE USED FOR SIGNATURE GUARANTEES)
As set forth in Section 3 of the Offer to Purchase (as defined below),
this form, or a form substantially equivalent to this form, must be used to
accept the Offer (as defined below) if the certificates representing shares of
common stock, par value $.10 per share of Dynamics Corporation of America (the
"Shares"), are not immediately available or time will not permit all required
documents to reach the Depositary prior to the Expiration Date (as defined in
the Offer to Purchase) or the procedures for book-entry transfer cannot be
completed on a timely basis. Such form may be delivered by hand or transmitted
by telegram, facsimile transmission or mail to the Depositary and must include a
guarantee by an Eligible Institution (as defined in Section 3 of the Offer to
Purchase). See Section 3 of the Offer to Purchase.
The Depositary for the Offer is:
HARRIS TRUST COMPANY OF NEW YORK
By Mail: By Overnight Courier: By Hand:
Wall Street Station 77 Water Street, 4th Receive Window
P.O. Box 1023 Floor 77 Water Street, 5th
New York, NY 10268-1023 New York, NY 10005 Floor
New York, NY 10005
By Facsimile Transmission:
(for Eligible Institutions
Only)
(212) 701-7636 or 7637
For Information Telephone (call
collect):
(212) 701-7624
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN
AS SET FORTH ABOVE, OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE TRANSMISSION
OTHER THAN AS SET FORTH ABOVE, WILL NOT CONSTITUTE A VALID DELIVERY.
This form is not to be used to guarantee signatures. If a signature on
a Letter of Transmittal is required to be guaranteed by an "Eligible
Institution" under the instructions thereto, such signature guarantee must
appear in the applicable space provided in the signature box on the Letter of
Transmittal.
LADIES AND GENTLEMEN:
The undersigned hereby tenders to SB Acquisition Corp., a New York
corporation and a wholly owned subsidiary of WHX Corporation, a Delaware
corporation, upon the terms and subject to the conditions set forth in the Offer
to Purchase, dated March 31, 1997 (the "Offer to Purchase"), and the related
Letter of Transmittal (which, as amended from time to time, together constitute
the "Offer"), receipt of each of which is hereby acknowledged, the number of
Shares specified below pursuant to the guaranteed delivery procedures described
in "Procedures for Tendering Shares" of the Offer to Purchase.
<PAGE>
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
<TABLE>
<CAPTION>
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<S> <C>
Number of Shares: Name(s) of Record Holder(s):
Share Certificate Numbers (if available): -----------------------------
PLEASE TYPE OR PRINT
- ---------------------------------------------
Address(es)------------------
/ / Check here if Shares will be delivered by
book-entry transfer. Zip Code
Check box of applicable book-entry transfer Area Code and Telephone Number:
facility:
------------------------------
------------------------------
/ / DTC / / PDTC SIGNATURE(S)
Account Number Dated: , 1997
--------------------------------- ---------------
Dated: , 1997
- ------------------------------------------------- --------------------------------
</TABLE>
The undersigned, a participant in the Security Transfer Agents Medallion
Program (each, an "Eligible Institution"), hereby guarantees that either the
certificates representing the Shares tendered hereby in proper form for
transfer, or timely confirmation of a book-entry transfer of such Shares into
the Depositary's account at The Depository Trust Company or the Philadelphia
Depository Trust Company (pursuant to procedures set forth in Section 3 of the
Offer to Purchase), together with a properly completed and duly executed Letter
of Transmittal (or facsimile thereof) with any required signature guarantees and
any other documents required by the Letter of Transmittal, will be received by
the Depositary at one of its addresses set forth above within three (3) New York
Stock Exchange trading days after the date of execution hereof.
The Eligible Institution that completes this form must communicate the
guarantee to the Depositary and must deliver the Letter of Transmittal and
certificates for Shares and associated Rights to the Depositary within the time
period shown herein. Failure to do so could result in financial loss to such
Eligible Institution.
Name of Firm:
----------------------------- ----------------------------------
AUTHORIZED SIGNATURE
Address: Name:
----------------------------------- -----------------------------
Zip Code PLEASE TYPE OR PRINT
Title:
--------------------------
Area Code and
Telephone Number: Dated: , 1997
------------------------- --------------------
NOTE: DO NOT SEND CERTIFICATES FOR SHARES OR ASSOCIATED RIGHTS WITH THIS NOTICE.
SUCH CERTIFICATES SHOULD BE SENT WITH YOUR LETTER OF TRANSMITTAL.
-2-
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES
OF
COMMON STOCK (INCLUDING THE ASSOCIATED RIGHTS)
OF
DYNAMICS CORPORATION OF AMERICA
AT
$40 NET PER SHARE
by
SB ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
WHX CORPORATION
- --------------------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME
ON TUESDAY, APRIL 29, 1997 UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
March 31, 1997
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
We are asking you to contact your clients for whom you hold shares of
common stock, par value $.10 per share (the "Shares"), of Dynamics Corporation
of America, a New York corporation (the "Company"). Please bring to their
attention as promptly as possible the offer being made by SB Acquisition Corp.,
a New York corporation ("Purchaser") and a wholly owned subsidiary of WHX
Corporation, a Delaware corporation ("Parent"), to purchase up to the Specified
Percentage (as defined in the Offer to Purchase, which is defined herein) of
Shares, including the associated Common Stock Purchase Rights (the "Rights")
issued pursuant to the Rights Agreement, dated as of January 30, 1986, as
amended on December 27, 1995, between the Company and First National Bank of
Boston, as Rights Agent, at a price of $40 per Share, net to the seller in cash,
without interest thereon (the "Offer Price"), upon the terms and subject to the
conditions set forth in the Offer to Purchase, dated March 31, 1997 (the "Offer
to Purchase"), and the related Letter of Transmittal (which, as amended from
time to time, together constitute the "Offer") enclosed herewith.
For your information and for forwarding to your clients for whom you
hold Shares registered in your name or in the name of your nominee, or who hold
Shares registered in their own names, we are enclosing the following documents:
1. Offer to Purchase, dated March 31, 1997;
2. Letter of Transmittal to be used by holders of shares in
accepting the Offer. Facsimile copies of the Letter of
Transmittal may be used to accept the Offer;
3. Notice of Guaranteed Delivery to be used to accept the Offer
if the certificates evidencing such Shares are not immediately
available or time will not permit all required documents to
reach the Depositary prior to the Expiration Date or the
procedure for book-entry transfer cannot be completed on a
timely basis;
4. A letter which may be sent to your clients for whose accounts
you hold Shares registered in your name or in the name of your
nominees, with space provided for obtaining such clients'
instructions with regard to the Offer;
<PAGE>
5. Guidelines of the Internal Revenue Service for Certification
of Taxpayer Identification Number on Substitute Form W-9; and
6. Return envelope addressed to the Depositary.
We are asking you to contact your clients for whom you hold Shares
registered in your name (or in the name of your nominee) or who hold Shares
registered in their own names. Please bring the Offer to their attention as
promptly as possible. The Purchaser will not pay any fees or commissions to any
broker or dealer or any other person (other than the Information Agent) for
soliciting tenders of Shares pursuant to the Offer. You will be reimbursed by
the Purchaser for customary mailing expenses incurred by you in forwarding any
of the enclosed materials to your clients. The Purchaser will pay or cause to be
paid any stock transfer taxes payable on the sale and transfer of Shares to it
or its order, except as otherwise provided in Instruction 6 of the Letter of
Transmittal.
YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS AS
PROMPTLY AS POSSIBLE. THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00
MIDNIGHT, EASTERN TIME, ON TUESDAY, APRIL 29, 1997, UNLESS THE OFFER IS
EXTENDED.
In order to take advantage of the Offer, (1) a duly executed and
properly completed Letter of Transmittal, and, if necessary, any other required
documents should be sent to the Depositary and (2) either certificates
representing the tendered Shares should be delivered to the Depositary, or such
Shares should be tendered by book-entry transfer into the Depositary's account
at one of the book-entry transfer facilities (as defined in the Offer to
Purchase), all in accordance with the Instructions set forth in the Letter of
Transmittal and the Offer to Purchase.
If holders of Shares wish to tender, but it is impracticable for them
to forward their certificates or other required documents to the Depositary
prior to the expiration of the Offer or to comply with the book-entry transfer
procedures on a timely basis, a tender may be effected by following the
guaranteed delivery procedures specified in Section 3 of the Offer to Purchase.
Any inquiries you may have with respect to the Offer should be
addressed to the Information Agent at the address and telephone number as set
forth on the back cover page of the Offer to Purchase.
Additional copies of the above documents may be obtained from the
Information Agent, at the address and telephone number set forth on the back
cover of the Offer to Purchase.
Very truly yours,
SB ACQUISITION CORP.
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE
YOU OR ANY OTHER PERSON AS AN AGENT OF PARENT, PURCHASER, THE DEPOSITARY OR THE
INFORMATION AGENT OR ANY AFFILIATE OF ANY OF THE FOREGOING, OR AUTHORIZE YOU OR
ANY OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY STATEMENT ON BEHALF OF ANY OF
THEM IN CONNECTION WITH THE OFFER OTHER THAN THE DOCUMENTS ENCLOSED AND THE
STATEMENTS CONTAINED THEREIN.
-2-
OFFER TO PURCHASE FOR CASH
UP TO THE SPECIFIED PERCENTAGE
OF
COMMON STOCK
(INCLUDING THE ASSOCIATED RIGHTS)
OF
DYNAMICS CORPORATION OF AMERICA
AT
$40 NET PER SHARE
by
SB ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
WHX CORPORATION
- --------------------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME
ON TUESDAY, APRIL 29, 1997 UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
March 31, 1997
To Our Clients:
Enclosed for your consideration is an Offer to Purchase, dated March
31, 1997 (the "Offer to Purchase"), and the related Letter of Transmittal
(which, as amended from time to time, together constitute the "Offer") in
connection with the Offer by SB Acquisition Corp., a New York corporation
("Purchaser") and a wholly owned subsidiary of WHX Corporation, a Delaware
corporation ("Parent"), to purchase up to the Specified Percentage (as defined
in the Offer to Purchase) of shares of common stock, par value $.10 per share
(the "Shares") of Dynamics Corporation of America, a New York corporation (the
"Company"), including the associated Common Stock Purchase Rights (the "Rights")
issued pursuant to the Rights Agreement, dated as of January 30, 1986, as
amended on December 27, 1995, between the Company and First National Bank of
Boston, as Rights Agent, at a price of $40 per Share, net to the seller in cash,
without interest thereon, upon the terms and subject to the conditions set forth
in the Offer.
THE MATERIAL IS BEING SENT TO YOU AS THE BENEFICIAL OWNER OF SHARES
HELD BY US FOR YOUR ACCOUNT BUT NOT REGISTERED IN YOUR NAME. WE ARE THE HOLDER
OF RECORD OF SHARES HELD BY US FOR YOUR ACCOUNT. A TENDER OF SUCH SHARES CAN BE
MADE ONLY BY US AS THE HOLDER OF RECORD AND PURSUANT TO YOUR INSTRUCTIONS. THE
LETTER OF TRANSMITTAL IS FURNISHED TO YOU FOR YOUR INFORMATION ONLY AND CANNOT
BE USED BY YOU TO TENDER SHARES HELD BY US FOR YOUR ACCOUNT.
We request instructions as to whether you wish to have us tender on
your behalf any or all of the Shares held by us for your account, upon the terms
and subject to the conditions set forth in the Offer.
Your attention is invited to the following:
1. The tender price is $40 per Share, net to the seller in cash.
2. The Offer, and withdrawal rights will expire at 12:00 Midnight,
New York City time, on Tuesday, April 29, 1997, unless the Offer
is extended.
3. The Offer is being made for significantly less than all of the
outstanding Shares.
<PAGE>
4. The Offer is conditioned upon, among other things, there not
having been entered into or effectuated any agreements with any
person impairing the Purchaser's ability to acquire the Company or
otherwise diminish the expected economic value to Purchaser of the
acquisition of the Company.
5. Tendering shareholders will not be obligated to pay brokerage fees
or commissions or, except as set forth in Instruction 6 of the
Letter of Transmittal, stock transfer taxes on the purchase of
Shares by Purchaser pursuant to the Offer.
6. Tendering shareholders must satisfy the Record Holder Condition
described in the Introduction and Section 1 of the Offer to
Purchase.
The Offer is made solely by the Offer to Purchase and the related
Letter of Transmittal and is being made to all holders of Shares. Purchaser is
not aware of any state where the making of the Offer is prohibited by
administrative or judicial action pursuant to any valid state statute. If
Purchaser becomes aware of any valid state statute prohibiting the making of the
Offer or the acceptance of Shares pursuant thereto, Purchaser will make a good
faith effort to comply with such state statute. If, after such good faith
effort, Purchaser cannot comply with such state statute, the Offer will not be
made to (nor will tenders be accepted from or on behalf of) the holders of
Shares in such state. In any jurisdiction where the securities, blue sky or
other laws require the Offer to be made by a licensed broker or dealer, the
Offer shall be deemed to be made on behalf of Purchaser by the Dealer Managers
or one or more registered brokers or dealers licensed under the laws of such
jurisdiction.
If you wish to have us tender any or all of your Shares, please so
instruct us by completing, executing and returning to us the instruction form
contained in this letter. An envelope in which to return your instructions to us
is enclosed. If you authorize the tender of your Shares, all such Shares will be
tendered unless otherwise specified on the instruction form set forth in this
letter. YOUR INSTRUCTIONS SHOULD BE FORWARDED TO US IN AMPLE TIME TO PERMIT US
TO SUBMIT A TENDER ON YOUR BEHALF PRIOR TO THE EXPIRATION OF THE OFFER.
-2-
<PAGE>
INSTRUCTIONS WITH RESPECT TO THE OFFER
TO PURCHASE FOR CASH UP TO THE SPECIFIED PERCENTAGE OF
SHARES OF COMMON STOCK (INCLUDING THE ASSOCIATED RIGHTS)
OF
DYNAMICS CORPORATION OF AMERICA
The undersigned acknowledge(s) receipt of your letter and the enclosed
Offer to Purchase, dated March 31, 1997 (the "Offer to Purchase"), and the
related Letter of Transmittal (which, as amended from time to time, together
constitute the "Offer"), in connection with the offer by SB Acquisition Corp., a
New York corporation ("Purchaser") and a wholly owned subsidiary of WHX
Corporation, a Delaware corporation, to purchase up to the Specified Percentage
(as defined in the Offer to Purchase) of shares of common stock, par value $.10
per share (the "Shares") of Dynamics Corporation of America, a New York
corporation, including the associated Common Stock Purchase Rights issued
pursuant to the Rights Agreement, dated as of January 30, 1986, as amended on
December 27, 1995, between the Company and First National Bank of Boston, as
Rights Agent, at a price of $40 per Share, net to the seller in cash, without
interest thereon, upon the terms and subject to the conditions set forth in the
Offer.
This will instruct you to tender to Purchaser the number of Shares
indicated below (or, if no number is indicated in either appropriate space
below, all Shares) held by you for the account of the undersigned, upon the
terms and subject to the conditions set forth in the Offer.
NUMBER OF SHARES TO BE TENDERED:*
________________Shares
Account Number: _______________
Dated: _____________, 1997
SIGN HERE
-------------------------------------------
-------------------------------------------
Signature(s)
-------------------------------------------
-------------------------------------------
Please Type or Print Name(s)
-------------------------------------------
-------------------------------------------
Please Type or Print
Address(es) Here
-------------------------------------------
Area Code and Telephone Number
-------------------------------------------
Taxpayer Identification or
Social Security Number(s)
- --------
* Unless otherwise indicated, it will be assumed that all Shares held by
us for your account are to be tendered.
-3-
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE
PAYER--Social Security numbers have nine digits separated by two hyphens: i.e.
000-00-0000. Employer identification numbers have nine digits separated by only
one hyphen: i.e., 00-0000000. The table below will help determine the number to
give the payer.
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
GIVE THE TAXPAYER GIVE THE TAXPAYER
FOR THIS TYPE OF ACCOUNT: IDENTIFICATION NUMBER OF-- FOR THIS TYPE OF ACCOUNT: IDENTIFICATION NUMBER OF--
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. An individual's account The individual 9. A valid trust, estate, or Legal entity (Do not furnish
pension trust the trust identifying number of
the personal representative or
trustee unless the legal entity
itself is not designated in the
account title.)(5)
2. Two or more individuals The actual owner of the 10. Corporate account The corporation
(joint account) account or, if combined funds,
any one of the individuals(1)
3. Husband and wife (joint The actual owner of the 11. Religious, charitable, or The organization
account) account or, if joint funds, educational organization
either person(2) account
4. Custodian account of a The minor(2) 12. Partnership account held The partnership
minor (Uniform Gift to in the name of the
Minors Act) business
5. Adult and minor (joint The adult or, if the minor is 13. Association, club, or The organization
account) the only contributor, the other tax-exempt
minor(1) organization
6. Account in the name of The ward, minor, or 14. A broker or registered The broker or nominee
guardian or committee for incompetent nominee
a designated ward, minor,
or incompetent person(3)
7. a. The usual revocable The grantor-trustee(1) 15. Account with the The public entity
savings trust account Department of
(grantor is also Agriculture in the name
trustee) of a public entity (such as
a State or local
government, school
district, or prison) that
receives agricultural
program payments
b. So-called trust The actual owner(1)
account that is not a
legal or valid trust
under State law
8. Sole proprietorship The owner(4)
account
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) List first and circle the name of the person whose number you furnish.
(2) Circle the minor's name and furnish the minor's social security number.
(3) Circle the ward's, minor's, or incompetent person's name and furnish such
person's social security number.
(4) Show the name of the owner.
(5) List first and circle the name of the legal trust, estate, or pension trust.
NOTE: If no name is circled when there is more than one name, the number will
be considered to be that of the first name listed.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
OBTAINING A NUMBER
If you do not have a taxpayer identification number or you do not know your
number, obtain Form SS-5, Application for a Social Security Number Card, or Form
SS-4, Application for Employer Identification Number, at the local office of the
Social Security Administration or the Internal Revenue Service and apply for a
number.
PAYEES EXEMPT FROM BACKUP WITHHOLDING
Payees specifically exempted from backup withholding on ALL payments include the
following:
. A corporation.
. A financial institution.
. An organization exempt from tax under section 501(a), or an individual
retirement plan.
. The United States or any agency or instrumentality thereof.
. A State, the District of Columbia, a possession of the United States, or
any subdivision or instrumentality thereof.
. A foreign government, a political subdivision of a foreign government, or
any agency or instrumentality thereof.
. An international organization or any agency or instrumentality thereof.
. A registered dealer in securities or commodities registered in the U.S.
or a possession of the U.S.
. A real estate investment trust.
. A common trust fund operated by a bank under section 584(a).
. An exempt charitable remainder trust, or a non-exempt trust described in
section 4947(a)(1).
. An entity registered at all times under the Investment Company Act of
1940.
. A foreign central bank of issue.
Payments of dividends and patronage dividends not generally subject to backup
withholding include the following:
. Payments to nonresident aliens subject to withholding under section
1441.
. Payments to partnerships not engaged in a trade or business in the U.S.
and which have at least one nonresident partner.
. Payments of patronage dividends where the amount received is not paid in
money.
. Payments made by certain foreign organizations.
Payments of interest not generally subject to backup withholding include the
following:
. Payments of interest on obligations issued by individuals.
NOTE: You may be subject to backup withholding if this interest is $600 or
more and is paid in the course of the payer's trade or business and you
have not provided your correct taxpayer identification number to the payer.
. Payments of tax-exempt interest (including exempt-interest dividends
under section 852).
. Payments described in section 6049(b)(5) to nonresident aliens.
. Payments on tax-free covenant bonds under section 1451.
. Payments made by certain foreign organizations.
. Payments of mortgage interest to you.
Exempt payees described above should file Form W-9 to avoid possible erroneous
backup withholding. FILE THIS FORM WITH THE PAYER. FURNISH YOUR TAXPAYER
IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM, AND RETURN IT TO
THE PAYER. IF THE PAYMENTS ARE INTEREST, DIVIDENDS, OR PATRONAGE DIVIDENDS, ALSO
SIGN AND DATE THE FORM.
-2-
<PAGE>
Certain payments other than interest, dividends, and patronage dividends,
that are not subject to information reporting are also not subject to backup
withholding. For details, see the regulations under sections 6041, 6041A(a),
6045, and 6050A.
PRIVACY ACT NOTICE--Section 6109 requires most recipients of dividend, interest,
or other payments to give taxpayer identification numbers to payers who must
report the payments to the IRS. The IRS uses the numbers for identification
purposes. Payers must be given the numbers whether or not recipients are
required to file a tax return. Payers must generally withhold 31% of taxable
interest, dividend, and certain other payments to a payee who does not furnish a
taxpayer identification number to a payer. Certain penalties may also apply.
PENALTIES
(1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER--If you fail
to furnish your taxpayer identification number to a payer, you are subject to a
penalty of $50 for each such failure unless your failure is due to reasonable
cause and not to willful neglect.
(2) FAILURE TO REPORT CERTAIN DIVIDEND AND INTEREST PAYMENTS--If you fail to
include any portion of an includable payment for interest, dividends, or
patronage dividends in gross income, such failure will be treated as being due
to negligence and will be subject to a penalty of 20% on any portion of an
underpayment attributable to that failure unless there is clear and convincing
evidence to the contrary.
(3) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING--If you make
a false statement with no reasonable basis which results in no imposition of
backup withholding, you are subject to a penalty of $500. (4) CRIMINAL PENALTY
FOR FALSIFYING INFORMATION--Falsifying certifications or affirmations may
subject you to criminal penalties including fines and/or imprisonment.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE
SERVICE
-3-
WHX CORP. COMMENCES TENDER OFFER AT $40 PER SHARE
FOR DYNAMICS CORP. OF AMERICA; INTENDS TO SOLICIT PROXIES
FOR ANNUAL MEETING
New York--March 31, 1997--WHX Corporation (NYSE: WHX) announced that
its wholly-owned subsidiary SB Acquisition Corp. is commencing today a cash
tender offer at $40 per share of common stock of Dynamics Corp. of America
(NYSE: DYA). The offer is initially set for that percentage of shares, which
together with the shares already owned by WHX, equals 19.9% of the outstanding
shares of common stock. In the event Dynamics Corp. of America amends its
"poison pill" rights agreement to reduce below 20% the ownership level at which
a shareholder becomes an acquiring person, then the percentage to be bought in
the tender offer will be automatically reduced by a commensurate amount. Based
on publicly available information and after taking into account the 109,600
shares of common stock (approximately 2.9%) which WHX already owns, the number
of shares to be purchased in the offer is currently up to 649,000.
The tender offer is not subject to any minimum number of shares being
tendered, nor is it subject to financing. As of December 31, 1996, WHX had over
$400 million of available cash and cash equivalents. The expiration, proration
and withdrawal dates for the tender offer are 12:00 midnight, New York City
time, on Tuesday, April 29, 1997.
Late last week WHX sent a letter to Dynamics Corp. of America proposing
a cash merger at $40 per share, giving the merger transaction a value of
approximately $160 million. In that proposal, WHX stated that it was prepared to
increase its offer if additional information which may be provided by Dynamics
Corp. of America demonstrates that a higher price is warranted. Furthermore, WHX
stated that it has no interest in increasing the equity stake which Dynamics
Corp. of America holds in CTS Corporation (NYSE: CTS) or in changing the nature
of the current relationship between those two companies.
In addition to commencing the tender offer, WHX intends to solicit
proxies from shareholders for the annual meeting of Dynamics Corp. of America,
scheduled to be held on May 2, 1997, to (1) elect four nominees, which would
constitute a majority of the board, and (2) adopt shareholder by-laws which will
permit holders of at least 9.9% of the outstanding common stock to call a
special meeting and will permit the removal of directors at any time without
cause. WHX will furnish stockholders with a written proxy
<PAGE>
statement at the earliest practicable date in accordance with applicable
regulations.
Following completion of the tender offer or the election of its
nominees to the board of directors of Dynamics Corp. of America, WHX intends to
take all appropriate actions which are necessary to expeditiously complete a
cash merger in which all stockholders receive $40 per share.
In order to enable WHX to vote the shares of common stock acquired in
the tender offer at the upcoming annual meeting of Dynamics Corp. of America,
shares will not be deemed to be duly tendered, and will not be accepted for
purchase, unless that are tendered by holders as of the March 14, 1997 record
date for the annual meeting, or they are accompanied by an irrevocable proxy
from a holder as of that date.
Georgeson & Co. is acting as information agent for WHX in the tender
offer. There is no dealer manager.
-2-
EXHIBIT (A)(8)
This announcement is neither an offer to purchase nor a solicitation of
an offer to sell Shares or Rights. The Offer is made solely by the Offer to
Purchase dated March 31, 1997 and the related Letter of Transmittal and is not
being made to (nor will tenders be accepted from or on behalf of) holders of
Shares or Rights in any jurisdiction in which the making of the Offer or the
acceptance thereof would not be in compliance with the laws of such
jurisdiction. In those jurisdictions where securities, blue sky or other laws
require the Offer to be made by a licensed broker or dealer, the Offer shall be
deemed to be made on behalf of SB Acquisition Corp. by one or more registered
brokers or dealers licensed under the laws of such jurisdiction.
OFFER TO PURCHASE FOR CASH
UP TO THE SPECIFIED PERCENTAGE OF SHARES OF
COMMON STOCK (INCLUDING THE ASSOCIATED RIGHTS) OF
DYNAMICS CORPORATION OF AMERICA
AT $40 PER SHARE
BY SB ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
WHX CORPORATION
SB Acquisition Corp. (the "Purchaser") hereby offers to purchase up to
the Specified Percentage (as defined below) of shares of common stock, par value
$.10 per share (the "Shares") of Dynamics Corporation of America, a New York
corporation (the "Company"), including the associated Common Stock Purchase
Rights (the "Rights") issued pursuant to the Rights Agreement, dated as of
January 30, 1986, as amended on December 27, 1995, between the Company and First
National Bank of Boston, as Rights Agent, at a price of $40 per Share, net to
the seller in cash, without interest thereon (the "Offer Price"), upon the terms
and subject to the conditions set forth in the Offer to Purchase dated March 31,
1997 (the "Offer to Purchase") and in the related Letter of Transmittal (which,
as amended from time to time, together constitute the "Offer"). The Purchaser is
a newly-formed New York corporation and a wholly-owned subsidiary of WHX
Corporation, a Delaware corporation ("Parent").
THE "SPECIFIED PERCENTAGE" SHALL INITIALLY MEAN THAT NUMBER OF SHARES
WHICH, TOGETHER WITH THE SHARES ALREADY OWNED BY PURCHASER OR PARENT, EQUALS
19.9% OF THE OUTSTANDING SHARES. IN THE EVENT
<PAGE>
THE COMPANY AMENDS THE RIGHTS AGREEMENT TO REDUCE BELOW 20% THE OWNERSHIP LEVEL
AT WHICH A SHAREHOLDER BECOMES AN ACQUIRING PERSON (AS DEFINED IN THE RIGHTS
AGREEMENT), THEN THE SPECIFIED PERCENTAGE SHALL AUTOMATICALLY BE COMMENSURATELY
REDUCED. SUCH DECREASE IN THE PERCENTAGE OF SHARES SOUGHT TO BE PURCHASED
PURSUANT TO THE OFFER SHALL NOT GIVE RISE TO ANY EXTENSION OF THE EXPIRATION,
PRORATION OR WITHDRAWAL DATES OF THE OFFER.
ACCORDING TO THE COMPANY'S PROXY STATEMENT DATED MARCH 26, 1997, AS OF
MARCH 14, 1997 THERE WERE 3,815,194 SHARES OUTSTANDING. BASED ON PUBLICLY
AVAILABLE INFORMATION AND AFTER TAKING INTO ACCOUNT THE 109,600 SHARES
(APPROXIMATELY 2.9%) WHICH THE PURCHASER ALREADY OWNS, THE NUMBER OF SHARES TO
BE PURCHASED IN THE OFFER IS CURRENTLY 649,000.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) ANY APPLICABLE WAITING
PERIOD UNDER THE HART-SCOTT-RODINO ANTITRUST IMPROVEMENTS ACT OF 1976, AS
AMENDED, SHALL HAVE EXPIRED OR BEEN TERMINATED PRIOR TO THE EXPIRATION OF THE
OFFER, AND (2) THE COMPANY NOT HAVING ENTERED INTO OR EFFECTUATED ANY AGREEMENTS
WITH ANY PERSON OR ENTITY HAVING THE EFFECT OF IMPAIRING PURCHASER'S ABILITY TO
ACQUIRE THE COMPANY OR OTHERWISE DIMINISHING THE EXPECTED ECONOMIC VALUE TO
PURCHASER OF THE ACQUISITION OF THE COMPANY.
THE OFFER IS NOT SUBJECT TO ANY MINIMUM NUMBER OF SHARES BEING TENDERED.
Unless the context requires otherwise, all references to Shares herein
shall include the associated Rights, and all references to the Rights shall
include all benefits that may inure to the holders of the Rights pursuant to the
Rights Agreement. Unless the Rights are redeemed prior to the Expiration Date,
holders of Shares will be required to tender one associated Right for each Share
tendered in order to effect a valid tender of such Share. Accordingly,
shareholders who sell their Rights separately from their Shares and do not
otherwise acquire Rights may not be able to satisfy the requirements of the
Offer for the tender of Shares.
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON TUESDAY, APRIL 29, 1997, UNLESS THE OFFER IS EXTENDED.
On March 27, 1997, Parent sent a letter to the Company regarding a
proposed business combination between the Company and Parent at $40 per share
(the "Merger Proposal"). In addition to commencing the Offer, Purchaser intends
to solicit proxies from the shareholders of the Company at the Annual Meeting of
Shareholders to be held on May 2, 1997 (the "Annual Meeting") to: (i) elect to
the Board of Directors four nominees of Purchaser (the "Purchaser Nominees"),
which would constitute a majority, and (ii) adopt
-2-
<PAGE>
shareholder by-laws which will permit holders of at least 9.9% of the Shares to
call a special meeting and permit the removal of directors at any time without
cause. The Purchaser Nominees are committed to promptly effect a merger of the
Company with and into the Purchaser at a price of $40 per Share in cash. THE
OFFER DOES NOT CONSTITUTE A SOLICITATION OF PROXIES FOR ANY MEETING OF THE
COMPANY'S SHAREHOLDERS. ANY SUCH SOLICITATION WOULD BE MADE ONLY PURSUANT TO
SEPARATE PROXY MATERIALS COMPLYING WITH APPLICABLE SECURITIES LAWS.
In order to enable the Purchaser to vote Shares acquired in the Offer
at the Annual Meeting, Shares shall not be deemed to be duly or properly
tendered, and they will not be accepted for purchase by the Purchaser, unless
(i) they are tendered to the Purchaser by a shareholder of record as of the
close of business on March 14, 1997 (the "Record Holder"); or (ii) they are
tendered to the Purchaser by or on behalf of a shareholder who has obtained a
valid, irrevocable proxy to vote such Shares in connection with their purchase
directly from the Record Holder, or pursuant to a chain of purchasers from the
Record Holder whereby each successive purchaser through and including the
shareholder tendering Shares to the Purchaser has obtained a valid, irrevocable
proxy to vote such Shares in connection with the purchase of such Shares from
the prior owner of such Shares; or (iii) if tendered by a shareholder not
meeting the criteria of subparagraph (i) or (ii) immediately above, the Shares
tendered are accompanied by a proxy duly executed by the Record Holder in favor
of the shareholder tendering his Shares to the Purchaser.
The Purchaser expressly reserves the right, in its sole discretion, at
any time and from time to time, to extend for any reason the period of time
during which the Offer is open, including as a result of the occurrence of any
of the events specified in Section 13 of the Offer to Purchase, by giving oral
or written notice of such extension to the Depositary (as defined in the Offer
to Purchase) and by making a public announcement thereof. During any such
extension, all Shares previously tendered and not withdrawn will remain subject
to the Offer, subject to the rights of a tendering shareholder to withdraw any
tendered Shares.
Upon the terms and subject to the conditions of the Offer, if more than
the Specified Percentage of Shares shall be validly tendered and not withdrawn
prior to the Expiration Date in accordance with Section 4 of the Offer to
Purchase, the Purchaser will purchase the Specified Percentage of Shares on a
pro rata basis (with adjustments to avoid purchases of fractional Shares) based
upon the number of Shares validly tendered and not withdrawn prior to the
Expiration Date. For purposes of the Offer, the Purchaser will be deemed to have
accepted for payment, and thereby purchased, tendered Shares if, as and when the
Purchaser gives oral or written notice to the Depositary of the Purchaser's
acceptance of such Shares for payment. Payment for Shares accepted pursuant
-3-
<PAGE>
to the Offer will be made by deposit of the aggregate purchase price therefor
with the Depositary, which will act as agent for tendering shareholders for the
purpose of receiving payment from the Purchaser and transmitting payment to such
tendering shareholders. Under no circumstances will interest be paid by the
Purchaser by reason of any delay in making such payment. Upon the deposit of
funds with the Depositary for the purpose of making payments to tendering
shareholders, the Purchaser's obligation to make such payment shall be satisfied
and tendering shareholders must thereafter look solely to the Depositary for
payment of amounts owed to them by reason of the acceptance for payment of
Shares pursuant to the Offer. In all cases, payment for Shares tendered and
accepted for payment pursuant to the Offer will be made only after timely
receipt by the Depositary of (a) certificates evidencing such Shares ("Share
Certificates"), or a timely confirmation of the book-entry transfer of such
Shares and, if applicable, Rights into the Depositary's account at a Book-Entry
Transfer Facility (as defined in the Offer to Purchase), pursuant to the
procedures set forth in Section 3 of the Offer to Purchase, (b) the Letter of
Transmittal (or a manually signed facsimile thereof), properly completed and
duly executed, with any required signature guarantees, or an Agent's Message (as
defined in the Offer to Purchase) in connection with a book-entry transfer, and
(c) any other documents required by the Letter of Transmittal.
If, for any reason whatsoever, acceptance for payment of or payment for
any Shares tendered pursuant to the Offer is delayed, or the Purchaser is unable
to accept for payment or pay for Shares tendered pursuant to the Offer, then,
without prejudice to the Purchaser's rights set forth herein, the Depositary
may, nevertheless, on behalf of the Purchaser and subject to Rule 14e-1(c) under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), retain
tendered Shares and such Shares may not be withdrawn except to the extent that
the tendering shareholder is entitled to and duly exercises withdrawal rights as
described in Section 4 of the Offer to Purchase. The Purchaser will pay any
stock transfer taxes incident to the transfer to it of validly tendered Shares,
except as otherwise provided in the Letter of Transmittal, as well as any
charges and expenses of the Depositary and the Information Agent. If any
tendering Shares are not accepted for payment for any reason pursuant to the
terms and conditions of the Offer or if Share Certificates are submitted
evidencing more Shares than are tendered, Share Certificates evidencing
unpurchased or untendered Shares will be returned, without expense to the
tendering shareholder (or, in the case of Shares tendered by book-entry transfer
into the Depositary's account at a Book-Entry Transfer Facility pursuant to the
procedure set forth in Section 3 of the Offer to Purchase, such Shares will be
credited to an account maintained at such Book-Entry Transfer Facility), as
promptly as practicable following the expiration or termination of the Offer.
Except as otherwise provided in Section 4 of the Offer to Purchase, tenders of
Shares made pursuant to the
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Offer are irrevocable. Shares tendered pursuant to the Offer may be withdrawn at
any time prior to the Expiration Date and, unless theretofore accepted for
payment by the Purchaser pursuant to the Offer, may also be withdrawn at any
time after May 28, 1997 or at such later time as may apply if the Offer is
extended.
If the Purchaser extends the Offer, is delayed in its acceptance for
payment of Shares or is unable to accept Shares for payment pursuant to the
Offer for any reason, then, without prejudice to the Purchaser's rights under
the Offer, the Depositary may, nevertheless, on behalf of the Purchaser, retain
tendered Shares, and such Shares may not be withdrawn except to the extent that
tendering shareholders are entitled to withdrawal rights as described in Section
4 of the Offer to Purchase. Any such delay will be by an extension of the Offer
to the extent required by law.
For a withdrawal to be effective, a written or facsimile transmission
notice of withdrawal must be timely received by the Depositary at one of its
addresses set forth on the back cover of the Offer to Purchase. Any such notice
of withdrawal must specify the name of the person who tendered the Shares to be
withdrawn, the number of Shares to be withdrawn and (if Share Certificates have
been tendered) the name of the registered holder, if different from that of the
person who tendered such Shares. If Share Certificates to be withdrawn have been
delivered or otherwise identified to the Depositary, then prior to the release
of such Share Certificates, the serial numbers shown on the particular Share
Certificates to be withdrawn must be submitted to the Depositary, and the
signature(s) on the notice of withdrawal must be guaranteed by an Eligible
Institution (as defined in the Offer to Purchase), unless such Shares have been
tendered for the account of an Eligible Institution. If Shares have been
tendered pursuant to the procedure for book-entry transfer as set forth in
Section 3 of the Offer to Purchase, any notice of withdrawal must also specify
the name and number of the account at the Book-Entry Transfer Facility to be
credited with the withdrawn Shares, in which case a notice of withdrawal will be
effective if delivered to the Depositary by any method of delivery described in
the first sentence of this paragraph. Withdrawals of Shares may not be
rescinded, but the holder thereof may retender such Shares pursuant to the
procedures set forth in the Offer to Purchase.
The information required to be disclosed by Rule 14d-6(e)(1)(vii) of
the General Rules and Regulations under the Exchange Act is contained in the
Offer to Purchase and is incorporated herein by reference.
A demand is being made to the Company, pursuant to Rule 14d-5 under the
Exchange Act, for the use of the Company's shareholder list and security
position listings for the purpose of disseminating the Offer to holders of
Shares. Upon compliance by the Company with such request, the Offer to Purchase
and the
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related Letter of Transmittal and, if required, other relevant materials will be
mailed to record holders of Shares or to brokers, dealers, commercial banks,
trust companies and similar persons whose names, or the names of whose nominees,
appear on the Company's shareholder list, or, if applicable, who are listed as
participants in a clearing agency's security position listing, for subsequent
transmittal to beneficial owners of Shares.
The Offer to Purchase and the Letter of Transmittal contain important
information which should be read carefully before any decision is made with
respect to the Offer.
Questions and requests for assistance, and requests for copies of the
Offer to Purchase, the Letter of Transmittal and other tender offer materials,
may be directed to the Information Agent at its address and telephone numbers
set forth below. Holders of Shares may also contact brokers, dealers, commercial
banks and trust companies for additional copies of the Offer to Purchase, the
Letter of Transmittal or other tender offer materials.
The Information Agent for the Offer is:
GEORGESON & COMPANY INC.
Wall Street Plaza
New York, New York 10005
Telephone: (212) 440-9800
or
CALL TOLL FREE: (800) 223-2064
April 1, 1997
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