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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 13E-4
Issuer Tender Offer Statement
(Pursuant to Section 13(e)(1) of the Securities Exchange Act of 1934)
------------------------
HANDY & HARMAN
(Name of issuer)
HANDY & HARMAN
(Name of person(s) filing statement)
------------------------
Common Stock, par value $1.00 per share
and the associated
Common Stock Purchase Rights
(Title of class of securities)
410306104
(CUSIP number of class of securities)
Paul E. Dixon, Vice President,
General Counsel and Secretary
Handy & Harman
250 Park Avenue
New York, New York 10177
(212) 661-2400
(Name, address and telephone number of person authorized to receive notices and
communications
on behalf of the person(s) filing statement)
------------------------
COPY TO:
Milton G. Strom
Skadden, Arps, Slate, Meagher & Flom LLP
919 Third Avenue
New York, New York 10022
(212) 735-3000
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October 24, 1996
(Date tender offer first published, sent or given to security holders)
CALCULATION OF FILING FEE
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TRANSACTION AMOUNT OF
VALUATION* FILING FEE
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$36,000,000 $7,200
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* Calculated solely for purposes of determining the filing fee, based upon the
purchase of 1,800,000 shares at the maximum tender offer price per share of
$20.00.
/ / 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: N/A Filing Party: N/A
Form or Registration No.: N/A Date File: N/A
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<PAGE> 2
This Issuer Tender Offer Statement on Schedule 13E-4 (the "Statement")
relates to the tender offer by Handy & Harman, a New York corporation (the
"Company"), to purchase up to 1,800,000 shares of its common stock, par value
$1.00 per share, and the associated common stock purchase rights (the "Rights,"
and collectively with shares of common stock, the "Shares"), at prices, net to
the seller in cash, not greater than $20.00 nor less than $17.50 per Share, upon
the terms and subject to the conditions set forth in the Offer to Purchase,
dated October 24, 1996 (the "Offer to Purchase") and the related Letter of
Transmittal (which, as they may be amended from time to time, are herein
collectively referred to as the "Offer"). Tenders of Shares pursuant to the
Offer will include a tender of the associated Rights and no separate
consideration will be paid for such Rights. Copies of the Offer to Purchase and
Letter of Transmittal are filed as Exhibits (a)(1) and (a)(2), respectively, to
this Statement.
ITEM 1. SECURITY AND ISSUER.
(a) The name of the issuer is Handy & Harman, a New York corporation. The
address of its principal executive offices is 250 Park Avenue, New York, New
York 10177.
(b) The information set forth in "Introduction," "Section 1. Number of
Shares; Proration" and "Section 9. Interests of Directors and Executive
Officers; Transactions and Arrangements Concerning the Shares" in the Offer to
Purchase is incorporated herein by reference. The Offer is being made to all
holders of Shares, including officers, directors and affiliates of the Company,
although the Company has been advised that none of its directors or executive
officers intends to tender any Shares pursuant to the Offer.
(c) The information set forth in "Introduction" and "Section 7. Price Range
of Shares; Dividends" in the Offer to Purchase is incorporated herein by
reference.
(d) This Statement is being filed by the issuer.
ITEM 2. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a)-(b) The information set forth in "Section 10. Source and Amount of
Funds" in the Offer to Purchase is incorporated herein by reference.
ITEM 3. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE ISSUER.
(a)-(j) The information set forth in "Introduction," "Section 8. Background
and Purpose of the Offer; Certain Effects of the Offer," "Section 9. Interests
of Directors and Executive Officers; Transactions and Arrangements Concerning
the Shares," "Section 10. Source and Amount of Funds" and "Section 12. Effects
of the Offer on the Market for Shares; Registration Under the Exchange Act" in
the Offer to Purchase is incorporated herein by reference.
ITEM 4. INTEREST IN SECURITIES OF THE ISSUER.
The information set forth in "Section 9. Interests of Directors and
Executive Officers; Transactions and Arrangements Concerning the Shares" and
"Schedule I -- Certain Transactions Involving Shares" in the Offer to Purchase
is incorporated herein by reference.
ITEM 5. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO THE ISSUER'S SECURITIES.
The information set forth in "Introduction," "Section 8. Background and
Purpose of the Offer; Certain Effects of the Offer" and "Section 9. Interests of
Directors and Executive Officers; Transactions and Arrangements Concerning the
Shares" in the Offer to Purchase is incorporated herein by reference.
ITEM 6. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.
The information set forth in "Introduction" and "Section 16. Fees and
Expenses" in the Offer to Purchase is incorporated herein by reference.
2
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ITEM 7. FINANCIAL INFORMATION.
(a)-(b) The information set forth in "Section 11. Certain Information About
the Company" in the Offer to Purchase is incorporated herein by reference. The
information set forth on (i) pages 15 through 32 of the Company's Annual Report
on Form 10-K for the fiscal year ended December 31, 1995, filed as exhibit
(g)(1) hereto; (ii) pages 19 through 36 of the Company's Annual Report on Form
10-K for the fiscal year ended December 31, 1994, filed as exhibit (g)(2)
hereto; (iii) pages 1 through 11 of the Company's Quarterly Report on Form 10-Q
for the quarter ended June 30, 1996, filed as exhibit (g)(3) hereto; and (iv)
pages 1 through 10 of the Company's Quarterly Report on Form 10-Q for the
quarter ended March 31, 1996, filed as exhibit (g)(4) hereto, in each case, is
incorporated herein by reference.
ITEM 8. ADDITIONAL INFORMATION.
(a) Not applicable.
(b) The information set forth in "Section 13. Certain Legal Matters;
Regulatory Approvals" in the Offer to Purchase is incorporated herein by
reference.
(c) The information set forth in "Section 12. Effects of the Offer on the
Market for Shares; Registration Under the Exchange Act" in the Offer to Purchase
is incorporated herein by reference.
(d) Not applicable.
(e) The information set forth in the Offer to Purchase and the related
Letter of Transmittal, copies of which are attached hereto as Exhibits (a)(1)
and (a)(2), respectively, is incorporated herein by reference.
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.
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(a)(1) Form of Offer to Purchase dated October 24, 1996.
(a)(2) Form of Letter of Transmittal.
(a)(3) Form of Notice of Guaranteed Delivery.
(a)(4) Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and
Other Nominees.
(a)(5) Form of Letter to Clients for use by Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees.
(a)(6) Form of Letter dated October 24, 1996 to shareholders from the Chairman and
Chief Executive Officer of the Company.
(a)(7) Form of Letter from the Company to participants in the Company Savings Plan,
including the form of Direction Form to T. Rowe Price Trust Company, as
Trustee, from participants in the Company savings plan.
(a)(8) Form of Press Release issued by the Company dated October 22, 1996.
(a)(9) Form of Summary Advertisement dated October 24, 1996.
(a)(10) Guidelines for Certification of Taxpayer Identification Number on Form W-9.
(b)(1) Revolving Credit Agreement dated as of September 28, 1994 (the "Revolving
Credit Agreement") among the Company, certain financial institutions, as
lenders, The Bank of Nova Scotia ("Scotiabank"), Chemical Bank and Bank of
New York, as co-agents, and Scotiabank, as administrative agent (previously
filed with the Commission as Exhibit 10.3 to the Company's Current Report on
Form 8-K dated October 12, 1994 and incorporated by reference herein).
(b)(2) First Amendment to the Revolving Credit Agreement, dated as of June 30,
1995.
(b)(3) Second Amendment to the Revolving Credit Agreement, dated as of September
24, 1996.
(b)(4) Third Amendment to the Revolving Credit Agreement, dated as of October 11,
1996.
(c) Not applicable.
(d) Not applicable.
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3
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(e) Not applicable.
(f) Not applicable.
(g)(1) Pages 15 through 32 of the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1995 (incorporated by reference from the
Company's Form 10-K filed with the Commission on March 28, 1996).
(g)(2) Pages 19 through 36 of the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1994 (incorporated by reference from the
Company's Form 10-K filed with the Commission on March 25, 1995).
(g)(3) Pages 1 through 11 of the Company's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1996 (incorporated by reference from the Company's
Form 10-Q filed with the Commission on August 13, 1996).
(g)(4) Pages 1 through 10 of the Company's Quarterly Report on Form 10-Q for the
quarter ended March 31, 1996 (incorporated herein by reference from the
Company's Form 10-Q filed with the Commission on May 15, 1996).
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4
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SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
HANDY & HARMAN
By: /s/ Paul E. Dixon
--------------------------------------
Name: Paul E. Dixon
Title: Vice President, General Counsel
and Secretary
Dated: October 24, 1996
5
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INDEX TO EXHIBITS
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ITEM DESCRIPTION
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(a) (1) Form of Offer to Purchase dated October 24, 1996.
(a) (2) Form of Letter of Transmittal.
(a) (3) Form of Notice of Guaranteed Delivery.
(a) (4) Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other
Nominees.
(a) (5) Form of Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust
Companies and other Nominees.
(a) (6) Form of Letter dated October 24, 1996 to shareholders from the Chairman and Chief
Executive Officer of the Company.
(a) (7) Form of Letter from the Company to participants in the Company Savings Plan,
including the form of Direction Form to T. Rowe Price Trust Company, as Trustee,
from participants in the Company savings plan.
(a) (8) Form of Press Release issued by the Company dated October 22, 1996.
(a) (9) Form of Summary Advertisement dated October 24, 1996.
(a)(10) Guidelines for Certification of Taxpayer Identification Number on Form W-9.
(b) (1) Revolving Credit Agreement dated as of September 28, 1994 (the "Revolving Credit
Agreement") among the Company, certain financial institutions, as lenders, The
Bank of Nova Scotia ("Scotiabank"), Chemical Bank and Bank of New York, as
co-agents, and Scotiabank, as administrative agent (previously filed with the
Commission as Exhibit 10.3 to the Company's Current Report on Form 8-K dated
October 12, 1994 and incorporated by reference herein).
(b) (2) First Amendment to the Revolving Credit Agreement, dated as of June 30, 1995.
(b) (3) Second Amendment to the Revolving Credit Agreement, dated as of September 24,
1996.
(b) (4) Third Amendment to the Revolving Credit Agreement, dated as of October 11, 1996.
(g) (1) Pages 15 through 32 of the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1995 (incorporated by reference from the Company's Form
10-K filed with the Commission on March 28, 1996).
(g) (2) Pages 19 through 36 of the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1994 (incorporated by reference from the Company's Form
10-K filed with the Commission on March 25, 1995).
(g) (3) Pages 1 through 11 of the Company's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1996 (incorporated by reference from the Company's Form 10-Q filed
with the Commission on August 13, 1996).
(g) (4) Pages 1 through 10 of the Company's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1996 (incorporated herein by reference from the Company's Form
10-Q filed with the Commission on May 15, 1996).
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<PAGE> 1
HANDY & HARMAN
OFFER TO PURCHASE FOR CASH UP TO
1,800,000 SHARES OF ITS COMMON STOCK
(INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS)
AT A PURCHASE PRICE NOT GREATER THAN $20.00
NOR LESS THAN $17.50 PER SHARE
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON THURSDAY, NOVEMBER 21, 1996, UNLESS THE OFFER IS
EXTENDED.
Handy & Harman, a New York corporation (the "Company"), invites its
shareholders to tender shares of its common stock, par value $1.00 per share
(including the associated common stock purchase rights) (the "Shares"), to the
Company at prices not greater than $20.00 nor less than $17.50 per Share in
cash, specified by tendering shareholders, upon the terms and subject to the
conditions set forth in this Offer to Purchase and the related Letter of
Transmittal (which, as amended from time to time, together constitute the
"Offer").
The Company will, upon the terms and subject to the conditions of the
Offer, determine a single per Share price (not greater than $20.00 nor less than
$17.50 per Share), net to the seller in cash (the "Purchase Price"), that it
will pay for Shares validly tendered and not withdrawn pursuant to the Offer,
taking into account the number of Shares so tendered and the prices specified by
tendering shareholders. The Company will select the lowest Purchase Price that
will allow it to buy 1,800,000 Shares validly tendered and not withdrawn
pursuant to the Offer (or such lesser number of Shares as are validly tendered
at prices not greater than $20.00 nor less than $17.50 per Share). The Company
will pay the Purchase Price for all Shares validly tendered at prices at or
below the Purchase Price and not withdrawn, upon the terms and subject to the
conditions of the Offer including the proration terms hereof. The Company
reserves the right, in its sole discretion, to purchase more than 1,800,000
Shares pursuant to the Offer.
THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS. SEE
SECTION 6.
At a meeting of the Board of Directors of the Company held on October 24,
1996, the Board of Directors declared a regular quarterly dividend of $.06 per
Share payable on December 3, 1996 to shareholders of record on November 15,
1996. Since the Expiration Date (as defined herein) will occur after November
15, 1996, holders of record on such date of Shares purchased in the Offer will
be entitled to receive such dividend to be paid to shareholders of record as of
such date regardless of whether such Shares are tendered pursuant to the Offer
prior to, on or after November 15, 1996. The Shares are listed and principally
traded on the New York Stock Exchange, Inc. (the "NYSE") under the symbol "HNH."
On October 21, 1996, the last full trading day on the NYSE prior to
announcement of the Offer, the closing per Share sales price as reported on the
NYSE Composite Tape was $17.375. SHAREHOLDERS ARE URGED TO OBTAIN CURRENT MARKET
QUOTATIONS FOR THE SHARES. SEE SECTION 7.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE MAKING
OF THE OFFER. HOWEVER, SHAREHOLDERS MUST MAKE THEIR OWN DECISIONS WHETHER TO
TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND THE PRICE OR PRICES AT
WHICH SHARES SHOULD BE TENDERED. NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS
MAKES ANY RECOMMENDATION TO ANY SHAREHOLDER AS TO WHETHER TO TENDER OR REFRAIN
FROM TENDERING SHARES. THE COMPANY HAS BEEN ADVISED THAT NONE OF ITS DIRECTORS
OR EXECUTIVE OFFICERS INTENDS TO TENDER ANY SHARES PURSUANT TO THE OFFER.
------------------------
The Dealer Manager for the Offer is:
J.P. MORGAN SECURITIES INC.
The Date of this Offer to Purchase is October 24, 1996.
<PAGE> 2
IMPORTANT
Any shareholders desiring to tender all or any portion of their Shares
should either (i) complete and sign the Letter of Transmittal or a facsimile
thereof in accordance with the instructions in the Letter of Transmittal, mail
or deliver it with any required signature guarantee and any other required
documents to ChaseMellon Shareholder Services, L.L.C. (the "Depositary"), and
either mail or deliver the stock certificates for such Shares to the Depositary
(with all such other documents) or follow the procedure for book-entry delivery
set forth in Section 3, or (ii) request a broker, dealer, commercial bank, trust
company or other nominee to effect the transaction for such shareholder. A
shareholder having Shares registered in the name of a broker, dealer, commercial
bank, trust company or other nominee must contact that broker, dealer,
commercial bank, trust company or other nominee if such shareholder desires to
tender such Shares. Shareholders who desire to tender Shares and whose
certificates for such Shares are not immediately available or who cannot comply
with the procedure for book-entry transfer on a timely basis or whose other
required documentation cannot be delivered to the Depositary, in any case, by
the expiration of the Offer should tender such Shares by following the
procedures for guaranteed delivery set forth in Section 3. TO EFFECT A VALID
TENDER OF THEIR SHARES, SHAREHOLDERS MUST VALIDLY COMPLETE THE LETTER OF
TRANSMITTAL, INCLUDING THE SECTION RELATING TO THE PRICE AT WHICH THEY ARE
TENDERING SHARES.
Questions and requests for assistance or for additional copies of this
Offer to Purchase, the Letter of Transmittal or the Notice of Guaranteed
Delivery may be directed to the Information Agent at its address and telephone
number set forth on the back cover of this Offer to Purchase.
2
<PAGE> 3
SUMMARY
This general summary is provided for the convenience of the Company's
shareholders and is qualified in its entirety by reference to the full text and
more specific details of this Offer to Purchase.
Number of Shares to be
Purchased................ 1,800,000 Shares (or such lesser number of Shares
as are validly tendered).
Purchase Price............. The Company will determine a single per Share net
cash price, not greater than $20.00 nor less than
$17.50 per Share, that it will pay for Shares
validly tendered. All Shares acquired in the
Offer will be acquired at the Purchase Price even
if tendered below the Purchase Price. Each
shareholder desiring to tender Shares must
specify in the Letter of Transmittal the minimum
price (not greater than $20.00 nor less than
$17.50 per Share) at which such shareholder is
willing to have Shares purchased by the Company.
How to Tender Shares....... See Section 3. Call the Information Agent or
consult your broker for assistance.
Dividends.................. See Section 7 for a discussion of payment of the
next regular quarterly dividend.
Brokerage Commissions...... None.
Stock Transfer Tax......... None, if payment is made to the registered holder.
Expiration and Proration
Dates...................... Thursday, November 21, 1996, at 12:00 Midnight, New
York City time, unless extended by the Company.
Payment Date............... As soon as practicable after the Expiration Date.
Position of the Company and
its Directors.............. Neither the Company nor its Board of Directors
makes any recommendation to any shareholder as to
whether to tender or refrain from tendering
Shares.
Withdrawal Rights.......... Tendered Shares may be withdrawn at any time until
12:00 Midnight, New York City time, on Thursday,
November 21, 1996, unless the Offer is extended
by the Company and, unless previously purchased,
after 12:00 Midnight, New York City time, on
Friday, December 20, 1996. See Section 4.
Odd Lots................... There will be no proration of Shares tendered by
any shareholder owning beneficially fewer than
100 Shares in the aggregate (including Shares
reflecting interests in the Company Stock Fund
allocated to the Savings Plans but excluding
Restricted Shares) as of October 23, 1996, and
continues to beneficially own fewer than 100
Shares on the Expiration Date, and who tenders
all such Shares at or below the Purchase Price
prior to the Expiration Date and who checks the
"Odd Lots" box in the Letter of Transmittal.
Further Developments
Regarding
the Offer................ Call the Information Agent or consult your broker.
3
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THE COMPANY HAS NOT AUTHORIZED ANY PERSON TO MAKE ANY RECOMMENDATION ON
BEHALF OF THE COMPANY AS TO WHETHER SHAREHOLDERS SHOULD TENDER OR REFRAIN FROM
TENDERING SHARES PURSUANT TO THE OFFER. THE COMPANY HAS NOT AUTHORIZED ANY
PERSON TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION IN CONNECTION WITH
THE OFFER ON BEHALF OF THE COMPANY OTHER THAN THOSE CONTAINED IN THIS OFFER TO
PURCHASE OR IN THE LETTER OF TRANSMITTAL. DO NOT RELY ON ANY SUCH RECOMMENDATION
OR ANY SUCH INFORMATION OR REPRESENTATION, IF GIVEN OR MADE, AS HAVING BEEN
AUTHORIZED BY THE COMPANY.
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TABLE OF CONTENTS
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SECTION PAGE
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INTRODUCTION..........................................................................
5
THE OFFER.............................................................................
7
1. Number of Shares; Proration......................................................
7
2. Tenders by Owners of Fewer than 100 Shares.......................................
8
3. Procedure for Tendering Shares...................................................
9
4. Withdrawal Rights................................................................
13
5. Purchase of Shares and Payment of Purchase Price.................................
14
6. Certain Conditions of the Offer..................................................
15
7. Price Range of Shares; Dividends.................................................
16
8. Background and Purpose of the Offer; Certain Effects of the Offer................
17
9. Interests of Directors and Executive Officers; Transactions and Arrangements
Concerning the Shares............................................................
19
10. Source and Amount of Funds.......................................................
20
11. Certain Information about the Company............................................
20
12. Effects of the Offer on the Market for Shares; Registration under the Exchange
Act.................................................................................
24
13. Certain Legal Matters; Regulatory Approvals......................................
24
14. Certain U.S. Federal Income Tax Consequences.....................................
25
15. Extension of the Offer; Termination; Amendments..................................
27
16. Fees and Expenses................................................................
27
17. Miscellaneous....................................................................
28
SCHEDULE I-Certain Transactions Involving Shares......................................
S-1
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TO THE HOLDERS OF SHARES OF
COMMON STOCK OF HANDY & HARMAN:
INTRODUCTION
Handy & Harman, a New York corporation (the "Company"), invites its
shareholders to tender shares of its common stock, par value $1.00 per share
(including the associated common stock purchase rights) (the "Shares"), to the
Company at prices not greater than $20.00 nor less than $17.50 per Share in
cash, specified by tendering shareholders, upon the terms and subject to the
conditions set forth in this Offer to Purchase and the related Letter of
Transmittal (which, as amended from time to time, together constitute the
"Offer").
The Company will, upon the terms and subject to the conditions of the
Offer, determine a single per Share price (not greater than $20.00 nor less than
$17.50 per Share), net to the seller in cash (the "Purchase Price"), that it
will pay for Shares validly tendered and not withdrawn pursuant to the Offer,
taking into account the number of Shares so tendered and the prices specified by
tendering shareholders. The Company will select the lowest Purchase Price that
will allow it to buy 1,800,000 Shares validly tendered and not withdrawn
pursuant to the Offer (or such lesser number of Shares as are validly tendered
at prices not greater than $20.00 nor less than $17.50 per Share). The Company
will pay the Purchase Price for all Shares validly tendered prior to the
Expiration Date (as defined in Section 1) at prices at or below the Purchase
Price and not withdrawn upon the terms and subject to the conditions of the
Offer including the proration terms described below. The Company reserves the
right, in its sole discretion, to purchase more than 1,800,000 Shares pursuant
to the Offer.
THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS. SEE
SECTION 6.
If, before the Expiration Date, more than 1,800,000 Shares are validly
tendered at or below the Purchase Price and not withdrawn (or such greater
number of Shares as the Company may elect to purchase), the Company will, upon
the terms and subject to the conditions of the Offer, purchase Shares first from
all Odd Lot Owners (as defined in Section 2) who validly tender all their Shares
at or below the Purchase Price and then on a pro rata basis from all other
shareholders who validly tender Shares at prices at or below the Purchase Price
(and do not withdraw them prior to the Expiration Date). The Company will return
at its own expense all Shares not purchased pursuant to the Offer, including
Shares tendered at prices greater than the Purchase Price and Shares not
purchased because of proration. The Purchase Price will be paid net to the
tendering shareholder in cash for all Shares purchased. Tendering shareholders
will not be obligated to pay brokerage commissions, solicitation fees or,
subject to Instruction 7 of the Letter of Transmittal, stock transfer taxes on
the Company's purchase of Shares pursuant to the Offer. HOWEVER, ANY TENDERING
SHAREHOLDER OR OTHER PAYEE WHO FAILS TO COMPLETE, SIGN AND RETURN TO THE
DEPOSITARY (AS DEFINED BELOW) THE SUBSTITUTE FORM W-9 THAT IS INCLUDED WITH THE
LETTER OF TRANSMITTAL MAY BE SUBJECT TO REQUIRED BACKUP FEDERAL INCOME TAX
WITHHOLDING OF 31% OF THE GROSS PROCEEDS PAYABLE TO SUCH SHAREHOLDER OR OTHER
PAYEE PURSUANT TO THE OFFER. SEE SECTION 3. In addition, the Company will pay
all fees and expenses of J.P. Morgan Securities Inc. (the "Dealer Manager"),
Georgeson & Company Inc. (the "Information Agent") and ChaseMellon Shareholder
Services, L.L.C. (the "Depositary") in connection with the Offer. See Section
16.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE MAKING
OF THE OFFER. HOWEVER, SHAREHOLDERS MUST MAKE THEIR OWN DECISIONS WHETHER TO
TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND THE PRICE OR PRICES AT
WHICH SHARES SHOULD BE TENDERED. NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS
MAKES ANY RECOMMENDATION TO ANY SHAREHOLDER AS TO WHETHER TO TENDER OR REFRAIN
FROM TENDERING SHARES. THE COMPANY HAS BEEN ADVISED THAT NONE OF ITS DIRECTORS
OR EXECUTIVE OFFICERS INTENDS TO TENDER ANY SHARES PURSUANT TO THE OFFER.
5
<PAGE> 6
The Company is making the Offer to (i) use the Company's cash and proceeds
realized upon the sale of a portion of the Company's precious metals inventory
to improve the Company's capital structure and lower its cost of capital for the
benefit of its shareholders, and (ii) afford to those shareholders who desire
liquidity an opportunity to sell all or a portion of their Shares without the
usual transaction costs associated with open market sales. The Offer also gives
shareholders an opportunity to sell their Shares at a price greater than the
prevailing market prices of the Shares immediately prior to the announcement of
the Offer. After the Offer is completed, the Company expects to have sufficient
cash flow and access to other sources of capital to fund its growth initiatives,
including building its businesses and making strategic acquisitions.
As of the close of business on October 16, 1996, there were 13,806,427
Shares outstanding and 942,631 Shares issuable upon exercise of outstanding
stock options ("Options") under the Company's 1995 Omnibus Stock Incentive Plan
and the Outside Director Stock Option Plan (collectively, the "Option Plans").
The 1,800,000 Shares that the Company is offering to purchase represent
approximately 13.0% of the outstanding Shares (approximately 12.2% assuming the
exercise of all outstanding Options).
The Handy & Harman Savings Plan (the "Savings Plan"), a defined
contribution 401(k) plan available to employees of the Company, holds Shares in
accounts for participants thereunder. Participants may instruct the Handy &
Harman Savings Plan Administrative Committee to direct T. Rowe Price Trust
Company ("T. Rowe Price"), as trustee of the Savings Plan, to tender all or part
of the Shares reflecting the participant's interest in the Shares held in the
Company stock fund (the "Company Stock Fund") credited to a participant's
individual account by following the instructions set forth in "Procedure for
Tendering Shares -- Savings Plan" in Section 3.
Additionally, certain shareholders have been issued restricted Shares
("Restricted Shares") pursuant to the provisions of the Company's Long-Term
Incentive Plan (the "Stock Plan," and, collectively, with the Option Plans, the
"Incentive Plans"). Pursuant to the provisions of the Stock Plan, Restricted
Shares may not be tendered in the Offer unless the restriction period applicable
to such Restricted Shares has expired. Shareholders who hold Restricted Shares
should see "Procedure for Tendering Shares -- Restricted Shares" in Section 3.
A tender of Shares pursuant to the Offer will include a tender of the
associated common stock purchase rights (the "Rights"). No separate
consideration will be paid for such Rights. Unless the context otherwise
requires, all references in this Offer to Purchase to the Shares shall include
the associated Rights. For a description of the Rights, see Section 7.
The Shares are listed and principally traded on the New York Stock
Exchange, Inc. ("NYSE") under the symbol "HNH." On October 21, 1996, the last
full trading day on the NYSE prior to the announcement of the Offer, the closing
per Share sales price as reported on the NYSE Composite Tape was $17.375. THE
COMPANY URGES SHAREHOLDERS TO OBTAIN CURRENT QUOTATIONS ON THE MARKET PRICE OF
THE SHARES.
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THE OFFER
1. NUMBER OF SHARES; PRORATION
Upon the terms and subject to the conditions of the Offer, the Company will
accept for payment (and thereby purchase) 1,800,000 Shares or such lesser number
of Shares as are validly tendered before the Expiration Date (and not withdrawn
in accordance with Section 4) at a net cash price (determined in the manner set
forth below) not greater than $20.00 nor less than $17.50 per Share. The term
"Expiration Date" means 12:00 Midnight, New York City time, on Thursday,
November 21, 1996, unless and until the Company 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 the Company, shall expire. See Section 15 for a
description of the Company's right to extend the time during which the Offer is
open and to delay, terminate or amend the Offer. Subject to Section 2, if the
Offer is oversubscribed, Shares tendered at or below the Purchase Price before
the Expiration Date will be eligible for proration. The proration period also
expires on the Expiration Date.
The Company will, upon the terms and subject to the conditions of the
Offer, determine a single per Share Purchase Price that it will pay for Shares
validly tendered and not withdrawn pursuant to the Offer, taking into account
the number of Shares so tendered and the prices specified by tendering
shareholders. The Company will select the lowest Purchase Price that will allow
it to buy 1,800,000 Shares validly tendered and not withdrawn pursuant to the
Offer (or such lesser number as are validly tendered at prices not greater than
$20.00 nor less than $17.50 per Share). The Company reserves the right, in its
sole discretion, to purchase more than 1,800,000 Shares pursuant to the Offer.
See Section 15. In accordance with applicable regulations of the Securities and
Exchange Commission (the "Commission"), the Company may purchase pursuant to the
Offer an additional amount of Shares not to exceed 2% of the outstanding Shares
without amending or extending the Offer. If (i) the Company increases or
decreases the price to be paid for Shares, the Company increases or decreases
the Dealer Manager's fee, the Company increases the number of Shares being
sought and such increase in the number of Shares being sought exceeds 2% of the
outstanding Shares, or the Company decreases the number of Shares being sought
and (ii) the Offer is scheduled to expire at any time earlier than the
expiration of a period ending on the tenth business day from, and including, the
date that notice of such increase or decrease is first published, sent or given
in the manner specified in Section 15, the Offer will be extended until the
expiration of such period of ten business days. For purposes of the Offer, a
"business day" means any day other than a Saturday, Sunday or federal holiday
and consists of the time period from 12:01 A.M. through 12:00 Midnight, New York
City time.
THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS. SEE
SECTION 6.
In accordance with Instruction 5 of the Letter of Transmittal, each
shareholder desiring to tender Shares must specify the price (not greater than
$20.00 nor less than $17.50 per Share) at which such shareholder is willing to
have the Company purchase Shares. As promptly as practicable following the
Expiration Date, the Company will, in its sole discretion, determine the
Purchase Price (not greater than $20.00 nor less than $17.50 per Share) that it
will pay for Shares validly tendered and not withdrawn pursuant to the Offer,
taking into account the number of Shares so tendered and the prices specified by
tendering shareholders. The Company will pay the Purchase Price, even if such
Shares were tendered below the Purchase Price, for all Shares validly tendered
prior to the Expiration Date at prices at or below the Purchase Price and not
withdrawn, upon the terms and subject to the conditions of the Offer. All Shares
not purchased pursuant to the Offer, including Shares tendered at prices greater
than the Purchase Price and Shares not purchased because of proration, will be
returned to the tendering shareholders at the Company's expense as promptly as
practicable following the Expiration Date.
If the number of Shares validly tendered at or below the Purchase Price and
not withdrawn prior to the Expiration Date is less than or equal to 1,800,000
Shares (or such greater number of Shares as the Company
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<PAGE> 8
may elect to purchase pursuant to the Offer), the Company will, upon the terms
and subject to the conditions of the Offer, purchase at the Purchase Price all
Shares so tendered.
Priority. Upon the terms and subject to the conditions of the Offer, in
the event that prior to the Expiration Date more than 1,800,000 Shares (or such
greater number of Shares as the Company may elect to purchase pursuant to the
Offer) are validly tendered at or below the Purchase Price and not withdrawn,
the Company will purchase such validly tendered Shares in the following order of
priority:
(i) all Shares validly tendered at or below the Purchase Price and not
withdrawn prior to the Expiration Date by any Odd Lot Owner (as defined in
Section 2) who:
(a) tenders all Shares (including Shares attributable to individual
accounts under the Savings Plan but excluding Restricted Shares)
beneficially owned by such Odd Lot Owner at or below the Purchase Price
(partial tenders will not qualify for this preference); and
(b) completes the box captioned "Odd Lots" on the Letter of
Transmittal (or, in the case of Savings Plan Participants (as defined
below) holding Odd Lots, the Direction Form (as defined below) sent to
such Participants (see Section 3)) and, if applicable, on the Notice of
Guaranteed Delivery; and
(ii) after purchase of all of the foregoing Shares, all other Shares
validly tendered at or below the Purchase Price and not withdrawn prior to
the Expiration Date on a pro rata basis.
Proration. In the event that proration of tendered Shares is required, the
Company will determine the final proration factor as promptly as practicable
after the Expiration Date. Proration for each shareholder tendering Shares
(other than Odd Lot Owners) shall be based on the ratio of the number of Shares
tendered by such shareholder at or below the Purchase Price to the total number
of Shares tendered by all shareholders (other than Odd Lot Owners) at or below
the Purchase Price. This ratio will be applied to shareholders tendering Shares
(other than Odd Lot Owners) to determine the number of Shares that will be
purchased from each such shareholder pursuant to the Offer. Although the Company
does not expect to be able to announce the final results of such proration until
approximately seven business days after the Expiration Date, it will announce
preliminary results of proration by press release as promptly as practicable
after the Expiration Date. Shareholders can obtain such preliminary information
from the Information Agent and may be able to obtain such information from their
brokers.
As described in Section 14, the number of Shares that the Company will
purchase from a shareholder may affect the United States federal income tax
consequences to the shareholder of such purchase and therefore may be relevant
to a shareholder's decision whether to tender Shares. The Letter of Transmittal
affords each tendering shareholder the opportunity to designate the order of
priority in which Shares tendered are to be purchased in the event of proration.
This Offer to Purchase and the related Letter of Transmittal will be mailed
to record holders of Shares as of October 23, 1996 and will be furnished to
brokers, banks 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.
2. TENDERS BY OWNERS OF FEWER THAN 100 SHARES
The Company, upon the terms and subject to the conditions of the Offer,
will accept for purchase, without proration, all Shares validly tendered at or
below the Purchase Price and not withdrawn on or prior to the Expiration Date by
or on behalf of shareholders who beneficially owned as of the close of business
on October 23, 1996, and continue to beneficially own as of the Expiration Date,
an aggregate of fewer than 100 Shares, including Shares attributable to
individual accounts under the Savings Plan but excluding any Restricted Shares
("Odd Lot Owners"). See Section 1. To avoid proration, however, an Odd Lot Owner
must validly tender at or below the Purchase Price all such Shares (including
Shares attributable to individual accounts under the Savings Plan but excluding
Restricted Shares) that such Odd Lot Owner beneficially owns; partial tenders
will not qualify for this preference. This preference is not available to
partial tenders or to
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<PAGE> 9
owners of 100 or more Shares in the aggregate (including Shares attributable to
individual accounts under the Savings Plan but excluding Restricted Shares),
even if such owners have separate stock certificates for fewer than 100 such
Shares. Any Odd Lot Owner wishing to tender all such Shares beneficially owned
by such shareholder pursuant to this Offer must complete the box captioned "Odd
Lots" in the Letter of Transmittal (or, with respect to Participants in the
Savings Plan who are Odd Lot Owners, the Direction Form (as defined below) sent
to such Participants) and, if applicable, on the Notice of Guaranteed Delivery
and must properly indicate in the section entitled "Price (In Dollars) Per Share
At Which Shares Are Being Tendered" in the Letter of Transmittal (or the
Direction Form, if applicable) the price at which such Shares are being
tendered, except that an Odd Lot Owner may check the box in the section entitled
"Odd Lots" indicating that the shareholder is tendering all of such
shareholder's Shares (including Shares attributable to individual accounts under
the Savings Plan but excluding Restricted Shares) at the Purchase Price. See
Section 3. Shareholders owning an aggregate of less than 100 Shares whose Shares
are purchased pursuant to the Offer will avoid both the payment of brokerage
commissions and any applicable odd lot discounts payable on a sale of their
Shares in transactions on a stock exchange, including the NYSE.
The Company also reserves the right, but will not be obligated, to purchase
all Shares duly tendered by any shareholder who tendered any Shares beneficially
owned at or below the Purchase Price and who, as a result of proration, would
then beneficially own an aggregate of fewer than 100 Shares. If the Company
exercises this right, it will increase the number of Shares that it is offering
to purchase in the Offer by the number of Shares purchased through the exercise
of such right.
3. PROCEDURE FOR TENDERING SHARES
Proper Tender of Shares. For Shares to be validly tendered pursuant to the
Offer:
(i) the certificates for such Shares (or confirmation of receipt of
such Shares pursuant to the procedures for book-entry transfer set forth
below), together with a properly completed and duly executed Letter of
Transmittal (or manually signed facsimile thereof) with any required
signature guarantees, and any other documents required by the Letter of
Transmittal, must be received prior to 12:00 Midnight, New York City time,
on the Expiration Date by the Depositary at its address set forth on the
back cover of this Offer to Purchase; or
(ii) the tendering shareholder must comply with the guaranteed
delivery procedure set forth below.
AS SPECIFIED IN INSTRUCTION 5 OF THE LETTER OF TRANSMITTAL, EACH
SHAREHOLDER DESIRING TO TENDER SHARES PURSUANT TO THE OFFER MUST PROPERLY
INDICATE IN THE SECTION CAPTIONED "PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES
ARE BEING TENDERED" IN THE LETTER OF TRANSMITTAL THE PRICE (IN MULTIPLES OF
$.25) AT WHICH SUCH SHAREHOLDER'S SHARES ARE BEING TENDERED, EXCEPT THAT AN ODD
LOT OWNER MAY CHECK THE BOX IN THE SECTION OF THE LETTER OF TRANSMITTAL ENTITLED
"ODD LOTS" INDICATING THAT THE SHAREHOLDER IS TENDERING ALL OF SUCH
SHAREHOLDER'S SHARES AT THE PURCHASE PRICE. Shareholders desiring to tender
Shares at more than one price must complete separate Letters of Transmittal for
each price at which Shares are being tendered, except that the same Shares
cannot be tendered (unless properly withdrawn previously in accordance with the
terms of the Offer) at more than one price. IN ORDER TO VALIDLY TENDER SHARES,
ONE AND ONLY ONE PRICE BOX MUST BE CHECKED IN THE APPROPRIATE SECTION ON EACH
LETTER OF TRANSMITTAL.
In addition, Odd Lot Owners who tender all Shares must complete the section
entitled "Odd Lots" on the Letter of Transmittal (or, in the case of Savings
Plan Participants holding Odd Lots, the Direction Form sent to such Participants
(see Savings Plan, below)) and, if applicable, on the Notice of Guaranteed
Delivery, in order to qualify for the preferential treatment available to Odd
Lot Owners as set forth in Section 2.
Signature Guarantees and Method of Delivery. No signature guarantee is
required on the Letter of Transmittal if (i) the Letter of Transmittal is signed
by the registered holder of the Shares (which term, for purposes of this
Section, includes any participant in The Depository Trust Company or the
Philadelphia Depository Trust Company (the "Book-Entry Transfer Facilities")
whose name appears on a security position listing as the holder of the Shares)
tendered therewith and payment and delivery are to be made directly to such
registered holder, or (ii) if Shares are tendered for the account of a firm or
other entity that is a member
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<PAGE> 10
in good standing of the Security Transfer Agent's Medallion Program, the New
York Stock Exchange Medallion Program or the Stock Exchange Medallion Program
(an "Eligible Institution"). In this regard see Section 5 for information with
respect to applicable stock transfer taxes. In all other cases, all signatures
on the Letter of Transmittal must be guaranteed by an Eligible Institution. See
Instruction 1 of the Letter of Transmittal. If a certificate representing Shares
is registered in the name of a person other than the signer of a Letter of
Transmittal, or if payment is to be made, or Shares not purchased or tendered
are to be issued, to a person other than the registered holder, the certificate
must be endorsed or accompanied by an appropriate stock power, in either case
signed exactly as the name of the registered holder appears on the certificate,
with the signature on the certificate or stock power guaranteed by an Eligible
Institution. 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 certificates for such Shares (or a timely confirmation of a book-entry
transfer of such Shares into the Depositary's account at one of the Book-Entry
Transfer Facilities as described below), a properly completed and duly executed
Letter of Transmittal (or manually signed facsimile thereof) and any other
documents required by the Letter of Transmittal.
THE METHOD OF DELIVERY OF ALL DOCUMENTS, INCLUDING SHARE CERTIFICATES, THE
LETTER OF TRANSMITTAL AND ANY OTHER REQUIRED DOCUMENTS, IS AT THE ELECTION AND
RISK OF THE TENDERING SHAREHOLDER. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH
RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED.
Book-Entry Delivery. The Depositary will establish an account with respect
to the Shares at each of the BookEntry Transfer Facilities for purposes of the
Offer within two business days after the date of this Offer to Purchase. Any
financial institution that is a participant in a Book-Entry Transfer Facility's
system may make book-entry delivery of the Shares by causing such facility to
transfer such Shares into the Depositary's account in accordance with such
facility's procedure for such transfer. Even though delivery of Shares may be
effected through book-entry transfer into the Depositary's account at one of the
Book-Entry Transfer Facilities, a properly completed and duly executed Letter of
Transmittal (or manually signed facsimile thereof), with any required signature
guarantees and 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 guaranteed
delivery procedure set forth below must be followed. DELIVERY OF THE LETTER OF
TRANSMITTAL AND ANY OTHER REQUIRED DOCUMENTS TO ONE OF THE BOOK-ENTRY TRANSFER
FACILITIES DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
Guaranteed Delivery. If a shareholder desires to tender Shares pursuant to
the Offer and such shareholder's Share certificates cannot be delivered to the
Depositary prior to the Expiration Date (or the procedures for book-entry
transfer cannot be completed on a timely basis) or time will not permit all
required documents to reach the Depositary before the Expiration Date, such
Shares may nevertheless be tendered provided that all of the following
conditions are satisfied:
(i) such tender is made by or through an Eligible Institution;
(ii) the Depositary receives (by hand, mail, overnight courier,
telegram or facsimile transmission), on or prior to the Expiration Date, a
properly completed and duly executed Notice of Guaranteed Delivery
substantially in the form the Company has provided with this Offer to
Purchase (indicating the price at which the Shares are being tendered),
including (where required) a signature guarantee by an Eligible Institution
in the form set forth in such Notice of Guaranteed Delivery; and
(iii) the certificates for all tendered Shares in proper form for
transfer (or confirmation of book-entry transfer of such Shares into the
Depositary's account at one of the Book-Entry Transfer Facilities),
together with a properly completed and duly executed Letter of Transmittal
(or manually signed facsimile thereof) and any required signature
guarantees or other documents required by the Letter of Transmittal, are
received by the Depositary no later than 5:00 p.m., New York City time, on
the third NYSE trading day after the date the Depositary receives such
Notice of Guaranteed Delivery.
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If any tendered Shares are not purchased, or if less than all Shares
evidenced by a shareholder's certificates are tendered, certificates for
unpurchased Shares will be returned as promptly as practicable after the
expiration or termination of the Offer or, in the case of Shares tendered by
book-entry transfer at a Book-Entry Transfer Facility, such Shares will be
credited to the appropriate account maintained by the tendering shareholder at
the appropriate Book-Entry Transfer Facility, in each case without expense to
such shareholder.
Backup Federal Income Tax Withholding. Under the United States federal
income tax backup withholding rules, unless an exemption applies under the
applicable law and regulations, 31% of the gross proceeds payable to a
shareholder or other payee pursuant to the Offer must be withheld and remitted
to the United States Treasury, unless the shareholder or other payee provides
such person's taxpayer identification number (employer identification number or
social security number) to the Depositary and certifies under penalties of
perjury that such number is correct. Therefore, each tendering shareholder
should complete and sign the Substitute Form W-9 included as part of the Letter
of Transmittal so as to provide the information and certification necessary to
avoid backup withholding, unless such shareholder otherwise establishes to the
satisfaction of the Depositary that the shareholder is not subject to backup
withholding. Certain shareholders (including, among others, all corporations and
certain foreign shareholders (in addition to foreign corporations)) are not
subject to these backup withholding and reporting requirements. In order for a
foreign shareholder to qualify as an exempt recipient, that shareholder must
submit an IRS Form W-8 or a Substitute Form W-8, signed under penalties of
perjury, attesting to that shareholder's exempt status. Such statements can be
obtained from the Depositary. See Instructions 10 and 11 of the Letter of
Transmittal.
TO PREVENT BACKUP FEDERAL INCOME TAX WITHHOLDING EQUAL TO 31% OF THE GROSS
PAYMENTS MADE TO SHAREHOLDERS FOR SHARES PURCHASED PURSUANT TO THE OFFER, EACH
SHAREHOLDER WHO DOES NOT OTHERWISE ESTABLISH AN EXEMPTION FROM SUCH WITHHOLDING
MUST PROVIDE THE DEPOSITARY WITH THE SHAREHOLDER'S CORRECT TAXPAYER
IDENTIFICATION NUMBER AND PROVIDE CERTAIN OTHER INFORMATION BY COMPLETING THE
SUBSTITUTE FORM W-9 INCLUDED WITH THE LETTER OF TRANSMITTAL.
For a discussion of certain United States federal income tax consequences
to tendering shareholders, see Section 14.
Withholding For Foreign Shareholders. Even if a foreign shareholder has
provided the required certification to avoid backup withholding, the Depositary
will withhold United States federal income taxes equal to 30% of the gross
payments payable to a foreign shareholder or his or her agent unless the
Depositary determines that a reduced rate of withholding is available pursuant
to a tax treaty or that an exemption from withholding is applicable because such
gross proceeds are effectively connected with the conduct of a trade or business
within the United States. For this purpose, a foreign shareholder is any
shareholder that is not (i) a citizen or resident of the United States, (ii) a
corporation, partnership, or other entity created or organized in or under the
laws of the United States, any State or any political subdivision thereof or
(iii) an estate or trust the income of which is subject to United States federal
income taxation regardless of the source of such income. In order to obtain a
reduced rate of withholding pursuant to a tax treaty, a foreign shareholder must
deliver to the Depositary before the payment a properly completed and executed
IRS Form 1001. In order to obtain an exemption from withholding on the grounds
that the gross proceeds paid pursuant to the Offer are effectively connected
with the conduct of a trade or business within the United States, a foreign
shareholder must deliver to the Depositary a properly completed and executed IRS
Form 4224. The Depositary will determine a shareholder's status as a foreign
shareholder and eligibility for a reduced rate of, or exemption from,
withholding by reference to any outstanding certificates or statements
concerning eligibility for a reduced rate of, or exemption from, withholding
(e.g., IRS Form 1001 or IRS Form 4224) unless facts and circumstances indicate
that such reliance is not warranted. A foreign shareholder may be eligible to
obtain a refund of all or a portion of any tax withheld if such shareholder
meets the "complete redemption", "substantially disproportionate" or "not
essentially equivalent to a dividend" test described in Section 14 or is
otherwise able to establish that no tax or a reduced amount of tax is due.
Backup withholding generally will not apply to amounts subject to the 30% or a
treaty-reduced rate of withholding. Foreign shareholders are
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<PAGE> 12
urged to consult their own tax advisors regarding the application of United
States federal income tax withholding, including eligibility for a withholding
tax reduction or exemption, and the refund procedure. See Instructions 10 and 11
of the Letter of Transmittal.
Savings Plan. As of October 17, 1996, the Savings Plan held 183,539
Shares, all of which were held in the Company Stock Fund under the Savings Plan.
Interests in the Company Stock Fund are credited to the individual accounts of
the Savings Plan participants, beneficiaries of deceased participants and
alternate payees pursuant to qualified domestic relations orders (collectively
referred to as "Participants"). Such Shares will, subject to the limitations of
the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and
applicable regulations thereunder, be tendered (or not tendered) by T. Rowe
Price, as trustee of the Savings Plan, according to the instructions of
Participants to the Plan Administrative Committee and T. Rowe Price. Shares for
which the Plan Administrative Committee and T. Rowe Price have not received
timely instructions from Participants will not be tendered by T. Rowe Price, in
accordance with the terms of the Savings Plan and the applicable trust
agreements. T. Rowe Price will make available to Participants whose individual
accounts are credited with Shares all documents furnished to shareholders
generally in connection with the Offer. Each such Participant will also receive
a form (the "Direction Form") upon which the Participant may instruct the Plan
Administrative Committee and T. Rowe Price regarding the Offer. Each Participant
may direct that all, some or none of the Shares attributable to such
Participant's account under the Savings Plan be tendered and the price at which
such Shares are to be tendered. All of the Shares of any Participant whose
individual account is credited with less than 100 Shares and tenders all of such
Shares in accordance with Section 2 hereof will be purchased by the Company
without proration. See Section 2. The Company will also provide additional
information in a separate letter with respect to the application of the Offer to
Participants in the Savings Plan. PARTICIPANTS IN THE SAVINGS PLAN MAY NOT USE
THE LETTER OF TRANSMITTAL TO DIRECT THE TENDER OF THE SHARES ATTRIBUTABLE TO
THEIR INDIVIDUAL ACCOUNTS, BUT MUST USE THE DIRECTION FORM SENT TO THEM.
PARTICIPANTS IN THE SAVINGS PLAN ARE URGED TO READ THE DIRECTION FORM AND
RELATED MATERIALS CAREFULLY. All proceeds received by T. Rowe Price on account
of Shares purchased from the Savings Plan will be reinvested in the T. Rowe
Price Prime Reserve Account as soon as administratively possible and such
investment will be credited to the plan Participant's individual account.
Participants may contact T. Rowe Price after the reinvestment is complete at
1(800)922-9945 to have any proceeds of the sale of Shares that were reinvested
in the T. Rowe Price Prime Reserve Account invested in a different manner
subject to the provisions of the Savings Plan.
Restricted Shares. Certain shareholders have been issued Restricted Shares
pursuant to the provisions of the Stock Plan. Pursuant to the provisions of the
Stock Plan, certificates representing Restricted Shares granted to Stock Plan
participants must remain deposited with the Company until the expiration of the
applicable restriction period (determined in accordance with the provisions of
the Stock Plan) and cannot be tendered in the Offer or otherwise transferred by
the participant until the expiration of the applicable restriction period. Upon
the expiration of such applicable restriction period and pursuant to the
provisions of the Stock Plan, such Restricted Shares shall no longer be
restricted and may be tendered pursuant to the Offer. Restricted Shares as to
which the applicable restriction period has expired shall thereafter be deemed
Shares. Shareholders may tender such Restricted Shares (as to which they have
been informed by the Company that the applicable restriction period has expired)
as Shares pursuant to the Offer by following the instructions for tendering
Shares set forth herein. Any questions with respect to the status of any
Restricted Shares or as to when restrictions with respect to a particular plan
participant's Restricted Shares expire may be directed to Stephen B. Mudd or
Paul E. Dixon at (914) 921-5200. RESTRICTED SHARES AS TO WHICH THE APPLICABLE
RESTRICTION PERIOD HAS NOT EXPIRED MAY NOT BE TENDERED PURSUANT TO THE OFFER.
Tendering Shareholder's Representation and Warranty; Company's Acceptance
Constitutes an Agreement. It is a violation of Rule 14e-4 promulgated under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), for a person
acting alone or in concert with others, directly or indirectly, to tender Shares
for such person's own account unless at the time of tender and at the Expiration
Date such person has a "net long position" equal to or greater than the amount
tendered in (a) the Shares and will deliver or cause to be delivered such Shares
for the purpose of tender to the Company within the period specified in the
Offer, or (b) other securities immediately convertible into, exercisable for or
exchangeable into Shares ("Equivalent
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Securities") and, upon the acceptance of such tender, will acquire such Shares
by conversion, exchange or exercise of such Equivalent Securities to the extent
required by the terms of the Offer and will deliver or cause to be delivered
such Shares so acquired for the purpose of tender to the Company within the
period specified in the Offer. Rule 14e-4 also provides a similar restriction
applicable to the tender or guarantee of a tender on behalf of another person. A
tender of Shares made pursuant to any method of delivery set forth herein will
constitute the tendering shareholder's representation and warranty to the
Company that (a) such shareholder has a "net long position" in Shares or
Equivalent Securities being tendered within the meaning of Rule 14e-4, and (b)
such tender of Shares complies with Rule 14e-4. The Company's acceptance for
payment of Shares tendered pursuant to the Offer will constitute a binding
agreement between the tendering shareholder and the Company upon the terms and
subject to the conditions of the Offer.
Determinations of Validity; Rejection of Shares; Waiver of Defects; No
Obligation to Give Notice of Defects. All questions as to the number of Shares
to be accepted, the price to be paid therefor and the validity, form,
eligibility (including time of receipt) and acceptance for payment of any tender
of Shares will be determined by the Company, in its sole discretion, which
determination shall be final and binding on all parties. The Company reserves
the absolute right to reject any or all tenders it determines not to be in
proper form or the acceptance of or payment for which may, in the opinion of the
Company's counsel, be unlawful. The Company also reserves the absolute right to
waive any of the conditions of the Offer and any defect or irregularity in the
tender of any particular Shares or any particular shareholder. No tender of
Shares will be deemed to be properly made until all defects or irregularities
have been cured or waived. None of the Company, the Dealer Manager, the
Depositary, the Information Agent or any other person is or will be obligated to
give notice of any defects or irregularities in tenders, and none of them will
incur any liability for failure to give any such notice.
CERTIFICATES FOR SHARES, TOGETHER WITH A PROPERLY COMPLETED LETTER OF
TRANSMITTAL AND ANY OTHER DOCUMENTS REQUIRED BY THE LETTER OF TRANSMITTAL, MUST
BE DELIVERED TO THE DEPOSITARY AND NOT TO THE COMPANY. ANY SUCH DOCUMENTS
DELIVERED TO THE COMPANY WILL NOT BE FORWARDED TO THE DEPOSITARY AND THEREFORE
WILL NOT BE DEEMED TO BE VALIDLY TENDERED.
4. WITHDRAWAL RIGHTS
Except as otherwise provided in this Section 4, tenders of Shares pursuant
to the Offer are irrevocable. Shares tendered pursuant to the Offer may be
withdrawn at any time before the Expiration Date and, unless accepted for
payment by the Company as provided in this Offer to Purchase, may also be
withdrawn after 12:00 Midnight, New York City time, on Friday, December 20,
1996.
For a withdrawal to be effective, the Depositary must receive (at its
address set forth on the back cover of this Offer to Purchase) a notice of
withdrawal in written, telegraphic or facsimile transmission form on a timely
basis. Such notice of withdrawal must specify the name of the person who
tendered the Shares to be withdrawn, the number of Shares tendered, 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 the certificates have been
delivered or otherwise identified to the Depositary, then, prior to the release
of such certificates, the tendering shareholder must also submit the serial
numbers shown on the particular certificates evidencing the Shares and the
signature on the notice of withdrawal must be guaranteed by an Eligible
Institution (except in the case of Shares tendered by an Eligible Institution).
If Shares have been tendered pursuant to the procedure for bookentry transfer
set forth in Section 3, the notice of withdrawal must specify the name and the
number of the account at the applicable Book-Entry Transfer Facility to be
credited with the withdrawn Shares and otherwise comply with the procedures of
such facility. All questions as to the form and validity, including time of
receipt, of notices of withdrawal will be determined by the Company, in its sole
discretion, which determination shall be final and binding on all parties. None
of the Company, the Dealer Manager, the Depositary, the Information Agent or any
other person is or will be obligated to give any notice of any defects or
irregularities in any notice of withdrawal, and none of them will incur any
liability for failure to give any such notice. Withdrawals may not be rescinded,
and any Shares properly withdrawn will thereafter be deemed
13
<PAGE> 14
not tendered for purposes of the Offer. However, withdrawn Shares may be
re-tendered before the Expiration Date by again following any of the procedures
described in Section 3.
If the Company extends the Offer, is delayed in its purchase of Shares or
is unable to purchase Shares pursuant to the Offer for any reason, then, without
prejudice to the Company's rights under the Offer, the Depositary may, subject
to applicable law, retain on behalf of the Company all tendered Shares, and such
Shares may not be withdrawn except to the extent tendering shareholders are
entitled to withdrawal rights as described in this Section 4.
Participants in the Savings Plan should disregard the foregoing procedures
with respect to Shares attributable to their individual accounts in the Savings
Plan and should follow the procedures for withdrawal included in the letter
furnished to such participants by the Company.
5. PURCHASE OF SHARES AND PAYMENT OF PURCHASE PRICE
The Company will, upon the terms and subject to the conditions of the
Offer, determine a single per Share Purchase Price that it will pay for Shares
validly tendered and not withdrawn pursuant to the Offer, taking into account
the number of Shares so tendered and the prices specified by tendering
shareholders, and will accept for payment and pay for (and thereby purchase)
Shares validly tendered at or below the Purchase Price and not withdrawn as soon
as practicable after the Expiration Date. For purposes of the Offer, the Company
will be deemed to have accepted for payment (and therefore purchased), subject
to proration, Shares that are validly tendered at or below the Purchase Price
and not withdrawn when, as and if it gives oral or written notice to the
Depositary of its acceptance of such Shares for payment pursuant to the Offer.
Upon the terms and subject to the conditions of the Offer, the Company will
purchase and pay a single per Share Purchase Price for all of the Shares
accepted for payment pursuant to the Offer as soon as practicable after the
Expiration Date. In all cases, payment for Shares tendered and accepted for
payment pursuant to the Offer will be made promptly (subject to possible delay
in the event of proration) but only after timely receipt by the Depositary of
certificates for Shares (or of a timely confirmation of a book-entry transfer of
such Shares into the Depositary's account at one of the Book-Entry Transfer
Facilities), a properly completed and duly executed Letter of Transmittal (or
manually signed facsimile thereof) and any other required documents.
Payment for Shares purchased pursuant to the Offer will be made by
depositing the aggregate Purchase Price therefor with the Depositary, which will
act as agent for tendering shareholders for the purpose of receiving payment
from the Company and transmitting payment to the tendering shareholders. In the
event of proration, the Company will determine the proration factor and pay for
those tendered Shares accepted for payment as soon as practicable after the
Expiration Date. However, the Company does not expect to be able to announce the
final results of any such proration until approximately seven business days
after the Expiration Date. Under no circumstances will the Company pay interest
on the Purchase Price including, without limitation, by reason of any delay in
making payment. Certificates for all Shares not purchased, including all Shares
tendered at prices greater than the Purchase Price and Shares not purchased due
to proration, will be returned (or, in the case of Shares tendered by book-entry
transfer, such Shares will be credited to the account maintained with one of the
Book-Entry Transfer Facilities by the participant who so delivered such Shares)
as promptly as practicable following the Expiration Date or termination of the
Offer without expense to the tendering shareholder. In addition, if certain
events occur, the Company may not be obligated to purchase Shares pursuant to
the Offer. See Section 6.
The Company will pay all stock transfer taxes, if any, payable on the
transfer to it of Shares purchased pursuant to the Offer; provided, however,
that if payment of the Purchase Price is to be made to, or (in the circumstances
permitted by the Offer) if unpurchased Shares are to be registered in the name
of, any person other than the registered holder, or if tendered certificates are
registered in the name of any person other than the person signing the Letter of
Transmittal, the amount of all stock transfer taxes, if any (whether imposed on
the registered holder or such other person), payable on account of the transfer
to such person will be deducted from the Purchase Price unless evidence
satisfactory to the Company of the payment of such taxes or exemption therefrom
is submitted. See Instruction 7 of the Letter of Transmittal.
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<PAGE> 15
ANY TENDERING SHAREHOLDER OR OTHER PAYEE WHO FAILS TO COMPLETE FULLY, SIGN
AND RETURN TO THE DEPOSITARY THE SUBSTITUTE FORM W-9 INCLUDED WITH THE LETTER OF
TRANSMITTAL MAY BE SUBJECT TO REQUIRED BACKUP FEDERAL INCOME TAX WITHHOLDING OF
31% OF THE GROSS PROCEEDS PAID TO SUCH SHAREHOLDER OR OTHER PAYEE PURSUANT TO
THE OFFER. SEE SECTION 3. ALSO SEE SECTION 3 REGARDING FEDERAL INCOME TAX
CONSEQUENCES FOR FOREIGN SHAREHOLDERS.
6. CERTAIN CONDITIONS OF THE OFFER
Notwithstanding any other provision of the Offer, the Company shall not be
required to accept for payment, purchase or pay for any Shares tendered, and may
terminate or amend the Offer or may postpone the acceptance for payment of, or
the purchase of and the payment for Shares tendered, subject to Rule 13e-4(f)
promulgated under the Exchange Act, if at any time on or after October 22, 1996
and prior to the time of payment for any such Shares (whether any Shares have
theretofore been accepted for payment, purchased or paid for pursuant to the
Offer) any of the following events shall have occurred (or shall have been
determined by the Company to have occurred) that, in the Company's judgment in
any such case and regardless of the circumstances giving rise thereto (including
any action or omission to act by the Company), makes it inadvisable to proceed
with the Offer or with such acceptance for payment or payment:
(a) there shall have been threatened, instituted or be pending before
any court, agency, authority or other tribunal any action, suit or
proceeding by any government or governmental, regulatory or administrative
agency or authority or by any other person, domestic or foreign, or any
judgment, order or injunction entered, enforced or deemed applicable by any
such court, authority, agency or tribunal, which (i) challenges or seeks to
make illegal, or to delay or otherwise directly or indirectly to restrain,
prohibit or otherwise affect the making of the Offer, the acquisition of
Shares pursuant to the Offer or is otherwise related in any manner to, or
otherwise affects, the Offer; or (ii) could, in the sole judgment of the
Company, materially affect the business, condition (financial or other),
income, operations or prospects of the Company and its subsidiaries, taken
as a whole, or otherwise materially impair in any way the contemplated
future conduct of the business of the Company and its subsidiaries, taken
as a whole, or materially impair the Offer's contemplated benefits to the
Company; or
(b) there shall have been any action threatened or taken, or any
approval withheld, or any statute, rule or regulation invoked, proposed,
sought, promulgated, enacted, entered, amended, enforced or deemed to be
applicable to the Offer or the Company or any of its subsidiaries, by any
government or governmental, regulatory or administrative authority or
agency or tribunal, domestic or foreign, which, in the sole judgment of the
Company, would or might directly or indirectly result in any of the
consequences referred to in clause (i) or (ii) of paragraph (a) above; or
(c) there shall have occurred (i) the declaration of any banking
moratorium or any suspension of payments in respect of banks in the United
States (whether or not mandatory); (ii) any general suspension of trading
in, or limitation on prices for, securities on any United States national
securities exchange or in the over-the-counter market; (iii) the
commencement of a war, armed hostilities or any other national or
international crisis directly or indirectly involving the United States;
(iv) any limitation (whether or not mandatory) by any governmental,
regulatory or administrative agency or authority on, or any event which, in
the sole judgment of the Company might materially affect, the extension of
credit by banks or other lending institutions in the United States; (v) any
significant decrease in the market price of the Shares or in the market
prices of equity securities generally in the United States or any change in
the general political, market, economic or financial conditions in the
United States or abroad that could have in the sole judgment of the Company
a material adverse effect on the business, condition (financial or
otherwise), income, operations or prospects of the Company and its
subsidiaries, taken as a whole, or on the trading in the Shares or on the
proposed financing of the Offer; (vi) in the case of any of the foregoing
existing at the time of the announcement of the Offer, a material
acceleration or worsening thereof; or (vii) any decline in either the Dow
Jones Industrial Average or the S&P 500 Composite Index by an amount in
excess of 10% measured from the close of business on October 22, 1996; or
15
<PAGE> 16
(d) any change shall occur or be threatened in the business, condition
(financial or other), income, operations or prospects of the Company and
its subsidiaries, taken as a whole, which in the sole judgment of the
Company is or may be material to the Company and its subsidiaries taken as
a whole; or
(e) it shall have been publicly disclosed or the Company shall have
learned that (i) any person or "group" (within the meaning of Section
13(d)(3) of the Exchange Act) has acquired or proposes to acquire
beneficial ownership of more than 5% of the outstanding Shares whether
through the acquisition of stock, the formation of a group, the grant of
any option or right, or otherwise (other than as disclosed in a Schedule
13D or 13G on file with the Commission on October 22, 1996) or (ii) any
such person or group that on or prior to October 22, 1996 had filed such a
Schedule with the Commission thereafter shall have acquired or shall
propose to acquire whether through the acquisition of stock, the formation
of a group, the grant of any option or right, or otherwise, beneficial
ownership of additional Shares representing 2% or more of the outstanding
Shares; or
(f) any person or group shall have filed a Notification and Report
Form under the Hart-Scott-Rodino Antitrust Improvements Act of 1976
reflecting an intent to acquire the Company or any of its Shares.
The foregoing conditions are for the Company's sole benefit and may be
asserted by the Company regardless of the circumstances giving rise to any such
condition (including any action or inaction by the Company) or may be waived by
the Company in whole or in part. The Company's failure 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 that may be asserted at any
time and from time to time. In certain circumstances, if the Company waives any
of the foregoing conditions, it may be required to extend the Expiration Date of
the Offer. Any determination by the Company concerning the events described
above and any related judgment or decision by the Company regarding the
inadvisability of proceeding with the purchase of or payment for any Shares
tendered will be final and binding on all parties.
7. PRICE RANGE OF SHARES; DIVIDENDS
The Shares are listed and principally traded on the NYSE. The high and low
closing sales prices per Share on the NYSE Composite Tape as compiled from
published financial sources and the quarterly cash dividends paid per Share for
the periods indicated are listed below:
<TABLE>
<CAPTION>
HIGH LOW DIVIDENDS
------- ------- ---------
<S> <C> <C> <C>
1994
1st Quarter......................................... $16.25 $14.375 $ .05
2nd Quarter......................................... 14.75 13.00 .05
3rd Quarter......................................... 17.625 13.625 .05
4th Quarter......................................... 17.125 13.50 .05
1995
1st Quarter......................................... $16.50 $14.125 $ .06
2nd Quarter......................................... 16.50 14.875 .06
3rd Quarter......................................... 16.875 14.625 .06
4th Quarter......................................... 16.625 13.625 .06
1996
1st Quarter......................................... $17.625 $15.375 $ .06
2nd Quarter......................................... 18.75 16.00 .06
3rd Quarter......................................... 18.125 16.25 .06
4th Quarter (through October 21, 1996).............. 18.375 16.50 .06(1)
</TABLE>
- ---------------
(1) Dividend declared on October 24, 1996, payable on December 3, 1996, to
holders of record of Shares on November 15, 1996, including holders of
record tendering Shares in the Offer.
16
<PAGE> 17
The closing per Share sales price as reported on the NYSE Composite Tape on
October 21, 1996, the last full trading day before the announcement of the
Offer, was $17.375. THE COMPANY URGES SHAREHOLDERS TO OBTAIN CURRENT QUOTATIONS
OF THE MARKET PRICE OF THE SHARES.
On January 26, 1989, the Board of Directors of the Company adopted a
Shareholders' Rights Plan, which was amended as of April 25, 1996 and October
22, 1996 (as amended, the "Rights Plan"), pursuant to which common stock rights
(the "Rights") were distributed to shareholders on the basis of one Right for
each Share held. In general, the Rights become exercisable or transferable only
upon the occurrence of certain events related to changes in ownership of the
Shares. Once exercisable, each Right entitles its holder to purchase from the
Company one Share at a purchase price of $58.00 per Share, subject to
adjustment. Upon the occurrence of certain other events related to changes in
the ownership of the Shares, each holder of a Right would be entitled to
receive, upon exercise, (i) the number of Shares for which such Right was
exercisable immediately prior to the event rendering the Rights exercisable at a
price equal to 10% of the then current market price per Share, subject to
adjustment, or (ii) shares of an acquiring corporation's common stock having a
market value equal to two times the exercise price of the Right. The Rights
expire on January 26, 1999 and, subject to certain conditions, may be redeemed
by the Board of Directors at any time at a price of $.02 per Right. The Rights
are not currently exercisable and trade together with the Shares associated
therewith. On October 22, 1996, the Rights Plan was amended (the "October
Amendment") to prevent the Rights from becoming exercisable due to the Offer.
The October Amendment was necessary because the percentage ownership of an
existing shareholder could be increased due to the repurchase of Shares by the
Company in the Offer and trigger the exercisability of the Rights by passing
certain shareholder ownership percentage thresholds (a shareholder passing such
a threshold, a "Potentially Triggering Shareholder"). The October Amendment
provides that so long as a Potentially Triggering Shareholder does not acquire
beneficial ownership of additional Shares representing one-half of one percent
or more of the outstanding Shares after the completion of the Offer, the
exercisability of the Rights will not be triggered. As a result of the October
Amendment, the Rights will not become exercisable or separately tradable due to
the Offer. Absent circumstances causing the Rights to become exercisable or
separately tradable prior to the Expiration Date, the tender of any Shares
pursuant to the Offer will include the tender of the associated Rights. No
separate consideration will be paid for such Rights. Upon the purchase of Shares
by the Company pursuant to the Offer, the sellers of the Shares so purchased
will no longer own the Rights associated with such Shares.
At a meeting of the Board of Directors of the Company held on October 24,
1996, the Board of Directors declared a regular quarterly dividend of $.06 per
Share payable on December 3, 1996 to shareholders of record on November 15,
1996. Since the Expiration Date will occur after November 15, 1996, holders of
record on such date of Shares purchased in the Offer will be entitled to receive
such dividend to be paid to shareholders of record as of such date regardless of
whether such Shares are tendered pursuant to the Offer prior to, on or after
November 15, 1996.
8. BACKGROUND AND PURPOSE OF THE OFFER; CERTAIN EFFECTS OF THE OFFER
On August 20, 1996, the Company completed the sale of its United States
precious metals refining division; in connection therewith, the Company retained
ownership of the precious metals inventory previously necessary for the
operation of the refining division. The Company intends to sell approximately
100,000 ounces of gold and approximately 4,430 ounces of platinum from its
inventory to provide a portion of the financing necessary to consummate the
Offer.
The Company is making the Offer to (i) use the Company's cash and proceeds
realized upon the sale of a portion of the Company's precious metals inventory
to improve the Company's capital structure and lower its cost of capital for the
benefit of its shareholders, and (ii) afford to those shareholders who desire
liquidity an opportunity to sell all or a portion of their Shares without the
usual transaction costs associated with open market sales. After the Offer is
completed, the Company expects to have sufficient cash flow and access to other
sources of capital to fund its growth initiatives, including building its
businesses and making strategic acquisitions.
17
<PAGE> 18
The Board of Directors believes that, given the Company's businesses,
assets and prospects, the purchase of the Shares pursuant to the Offer is an
attractive investment that will benefit the Company and its remaining
shareholders. The Offer provides shareholders who are considering a sale of all
or a portion of their Shares the opportunity to determine the price or prices
(not greater than $20.00 nor less than $17.50 per Share) at which they are
willing to sell their Shares and, if any such Shares are purchased pursuant to
the Offer, to sell those Shares for cash to the Company without the usual costs
associated with a market sale. The Offer gives shareholders an opportunity to
sell their Shares at a price greater than the prevailing market prices of the
Shares immediately prior to the announcement of the Offer. The Offer would also
allow Odd Lot Owners whose Shares are purchased pursuant to the Offer to avoid
both the payment of brokerage commissions and any applicable odd lot discounts
payable on sales of odd lots on a securities exchange. To the extent the
purchase of Shares in the Offer results in a reduction in the number of
shareholders of record, the costs to the Company for services to shareholders
should be reduced. Shareholders who determine not to accept the Offer will
increase their proportionate interest in the Company's equity, and therefore in
the Company's future earnings and assets, subject to the Company's right to
issue additional Shares and other equity securities in the future.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE MAKING
OF THE OFFER. HOWEVER, SHAREHOLDERS MUST MAKE THEIR OWN DECISIONS WHETHER TO
TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND THE PRICE OR PRICES AT
WHICH SHARES SHOULD BE TENDERED. NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS
MAKES ANY RECOMMENDATION TO ANY SHAREHOLDER AS TO WHETHER TO TENDER OR REFRAIN
FROM TENDERING SHARES AND NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS HAS
AUTHORIZED ANY PERSON TO MAKE ANY SUCH RECOMMENDATION. THE COMPANY HAS BEEN
ADVISED THAT NONE OF ITS DIRECTORS OR EXECUTIVE OFFICERS INTENDS TO TENDER ANY
SHARES PURSUANT TO THE OFFER.
As of October 16, 1996, no person was known by the Company to be the
beneficial owner of more than 5% of the outstanding Shares, except the Company
understands from publicly available reports to the Commission that Mario J.
Gabelli, Gabelli Funds, Inc., Gamco Investors, Inc., Gabelli & Company, Inc.,
Gabelli Performance Partnership, Gabelli International Limited and certain other
affiliated entities (each at One Corporate Center, Rye, New York 10580-1434)
(collectively, "Gabelli") may be deemed to be a group beneficially owning
2,708,200 outstanding Shares or approximately 19.6% (18.4% assuming the exercise
of all outstanding Options) of the outstanding Shares; and Neuberger & Berman
L.P., its affiliates and subsidiaries, at 605 Third Avenue, New York, New York
10158-3698 ("Neuberger & Berman") may be deemed to be a group beneficially
owning 1,240,400 outstanding Shares or 9.0% (8.4% assuming the exercise of all
outstanding Options) of the outstanding Shares. If the Company purchases
1,800,000 Shares pursuant to the Offer, assuming no Gabelli or Neuberger &
Berman Shares are tendered in the Offer, Gabelli and Neuberger & Berman Shares
would represent 22.6% and 10.3%, respectively, of the outstanding Shares (20.9%
and 9.6%, respectively, assuming the exercise of all outstanding Options).
Pursuant to the October Amendment to the Rights Plan, the above described
increase in Share ownership by Gabelli as a result of the Offer will not cause
the Rights to become exercisable. See Section 7.
On November 6, 1995, the Company announced that the Board of Directors had
authorized the repurchase of up to 1,500,000 of the then outstanding Shares (the
"Repurchase Program"). The Shares were to be purchased from time to time in the
open market or unsolicited negotiated transactions, including block purchases.
The timing of the Repurchase Program and number of Shares repurchased was to be
dictated by overall financial and market conditions. Since November 6, 1995, the
Company has repurchased 429,600 Shares at prices ranging from $15.00 to $17.75
per Share pursuant to the Repurchase Program. Rule 13e-4 under the Exchange Act
prohibits the Company from making any purchases of Shares until 10 business days
after the Expiration Date, other than pursuant to the Offer; thereafter, the
Company intends to resume the Repurchase Program. Any Share purchases under the
Repurchase Program or otherwise may be on the same terms as, or on terms more or
less favorable to shareholders than, the terms of the Offer. Any future
purchases by the Company, either pursuant to the Repurchase Program or
otherwise, will depend on numerous factors,
18
<PAGE> 19
including the market price of the Shares, the results of the Offer, the
Company's business and financial condition and general economic and market
conditions. Shares purchased in the Offer will not be counted in the aggregate
number of Shares to be purchased pursuant to the Repurchase Program.
Shares the Company acquires pursuant to the Offer will be retained as
treasury stock (unless and until the Company determines to retire such Shares)
and be available for issue without further shareholder action (except as
required by applicable law or, if retired, the rules of any securities exchange
on which Shares are listed) for purposes including, but not limited to, the
acquisition of other businesses, raising of additional capital for use in the
Company's businesses, and satisfaction of obligations under existing or future
employee benefit plans. The Company has no current plan for issuance of Shares
repurchased pursuant to the Offer.
Except as disclosed in this Offer to Purchase, the Company currently has no
plans or proposals that relate to or would result in (a) the acquisition by any
person of additional securities of the Company or the disposition of securities
of the Company; (b) an extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Company or any or all of its
subsidiaries; (c) a sale or transfer of a material amount of assets of the
Company or any of its subsidiaries; (d) any change in the present Board of
Directors or management of the Company; (e) any material change in the present
dividend rate or policy, or indebtedness or capitalization of the Company; (f)
any other material change in the Company's corporate structure or business; (g)
any change in the Company's Certificate of Incorporation or By-Laws or any
actions which may impede the acquisition of control of the Company by any
person; (h) a class of equity security of the Company being delisted from a
national securities exchange; (i) a class of equity security of the Company
becoming eligible for termination of registration pursuant to Section 12(g)(4)
of the Exchange Act; or (j) the suspension of the Company's obligation to file
reports pursuant to Section 15(d) of the Exchange Act.
9. INTERESTS OF DIRECTORS AND EXECUTIVE OFFICERS; TRANSACTIONS AND ARRANGEMENTS
CONCERNING THE SHARES
As of October 16, 1996, there were 13,806,427 Shares outstanding. On
September 28, 1996, the compensation committee of the Board of Directors granted
140,000 Options to certain executive officers of the Company and there presently
are 942,631 Shares issuable upon the exercise of all outstanding Options. As of
October 16, 1996, the Company's directors and executive officers as a group (16
persons) beneficially owned 633,082 Shares (including 373,981 Shares issuable
upon the exercise of Options exercisable within 60 days of such date), which
constituted approximately 4.5% of the outstanding Shares (including Shares
issuable if Options held by the Company's directors and executive officers
exercisable within 60 days of such date were exercised) at such time. If the
Company purchases 1,800,000 Shares pursuant to the Offer (approximately 13.0% of
the outstanding Shares as of October 16, 1996) and no director or executive
officer tenders Shares pursuant to the Offer (as is intended by the directors
and executive officers), then after the purchase of Shares pursuant to the
Offer, the Company's directors and executive officers as a group would
beneficially own approximately 5.1% of the outstanding Shares (including Shares
issuable if Options held by the Company's directors and executive officers
exercisable within 60 days of such date were exercised). As of October 16, 1996,
no director or executive officer had beneficial ownership of more than 1% of the
outstanding Shares, except Richard N. Daniel, Chairman of the Board and Chief
Executive Officer of the Company, and Frank E. Grzelecki, President and Chief
Operating Officer of the Company, whose beneficial ownership was approximately
1.6% and 1.1%, respectively, of the outstanding Shares (including Shares
issuable if Options held by the Company's directors and executive officers
exercisable within sixty days of such date were exercised). If the Company
purchases 1,800,000 Shares pursuant to the Offer, assuming no Shares
beneficially owned by Mr. Daniel or Mr. Grzelecki are tendered in the Offer (as
is intended by Messrs. Daniel and Grzelecki), Shares beneficially owned by Mr.
Daniel and Mr. Grzelecki would represent approximately 1.8% and 1.2%,
respectively, of the outstanding Shares (including Shares issuable if Options
held by the Company's directors and executive officers exercisable within 60
days of such date were exercised).
Except as set forth in Section 8 hereof or in Schedule I hereto, based on
the Company's records and information provided to the Company by its directors,
executive officers, associates and subsidiaries, neither the Company nor any of
its associates or subsidiaries or persons controlling the Company nor, to the
best of the Company's knowledge, any of the directors or executive officers of
the Company or any of its subsidiaries,
19
<PAGE> 20
nor any associates or subsidiaries of any of the foregoing, has effected any
transactions in the Shares during the 40 business days prior to the date hereof.
Except as set forth in this Offer to Purchase, neither the Company or any
person controlling the Company nor, to the Company's knowledge, any of its
directors or executive officers, is a party to any contract, arrangement,
understanding or relationship with any other person relating, directly or
indirectly, to the Offer with respect to any securities of the Company
(including, but not limited to, any contract, arrangement, understanding or
relationship concerning the transfer or the voting of any such securities, joint
ventures, loan or option arrangements, puts or calls, guarantees of loans,
guarantees against loss or the giving or withholding of proxies, consents or
authorizations).
10. SOURCE AND AMOUNT OF FUNDS
Assuming that the Company purchases 1,800,000 Shares pursuant to the Offer
at the maximum specified purchase price of $20.00 per Share, the Company expects
the maximum aggregate cost, including all fees and expenses applicable to the
Offer, to be approximately $36,500,000. The Company anticipates that
substantially all of the funds necessary to pay such amounts will be provided by
the Company's cash, proceeds of the sale of precious metals and the existing
credit facilities of the Company.
On August 20, 1996, the Company completed the sale of its United States
precious metals refining division; in connection therewith, the Company retained
ownership of the precious metals inventory previously necessary for the
operation of the refining division. The Company intends to sell approximately
100,000 ounces of gold and approximately 4,430 ounces of platinum from its
inventory to provide a portion of the financing necessary to consummate the
Offer.
The Company intends to obtain an additional portion of the financing for
the Offer through unsecured borrowings under its Revolving Credit Agreement,
dated as of September 28, 1994, as amended (the "Credit Agreement"), among the
Company and certain financial institutions, as lenders. Under the Credit
Agreement, the Bank of Nova Scotia ("Scotiabank"), Chemical Bank and Bank of New
York act as co-agents and Scotiabank acts as administrative agent. Pursuant to
the Credit Agreement, the Company has a $200 million revolving credit facility
(the "Credit Facility"), subject to reduction in certain circumstances. Loans
made under the Credit Facility bear interest, at the Company's option, (a) at a
rate equal to the sum of the applicable margin and the (i) London inter-bank
offered rate ("LIBOR") or (ii) an Alternate Base Rate equal to the greater of
(x) Scotiabank's base rate for loans in U.S. dollars in the United States, and
(y) the sum of the federal funds rate and 50 basis points, or (b) at a rate
determined by a competitive bid system among the financial institutions party to
the Credit Agreement. The applicable margin varies based on certain financial
ratios relating to the Company's financial condition. The final maturity date of
any loan under the Credit Facility is September 27, 1999, unless extended
pursuant to the terms of the Credit Agreement. The Credit Agreement includes
representations and warranties, covenants, events of default and other terms
customary to financing of this type. A copy of the Credit Agreement has been
filed with the Commission as an exhibit to the Company's Current Report on Form
8-K dated October 12, 1994 and is incorporated by reference herein. On June 30,
1995, September 24, 1996 and October 11, 1996, the Credit Agreement was amended
(the "Amendments"); copies of the Amendments were filed as exhibits to the
Issuer Tender Offer Statement on Schedule 13E-4 filed by the Company on the date
hereof and which Amendments are incorporated by reference herein.
The Company expects to repay indebtedness incurred under the Credit
Facility as a result of the Offer through cash flow from operations and/or
future borrowings.
11. CERTAIN INFORMATION ABOUT THE COMPANY
The Company was incorporated in the State of New York in 1905 as the
successor to a partnership which commenced business in 1867. Until commencing a
diversification program in 1966, the Company was engaged primarily in the
manufacture of silver and gold alloys in mill forms and the refining of precious
metals from jewelry and industrial scrap. The Company's markets were largely
among silversmiths and manufacturing jewelers, users of silver brazing alloys,
and manufacturers who required silver and gold primarily for the
20
<PAGE> 21
properties of those metals. As part of these precious metals operations, the
Company continues to publish a daily New York price for its purchases of silver
and gold and also publishes a daily price for its fabricated silver and gold.
The silver price is relied on and used by manufacturers, banks, traders and
others throughout the world. The diversification program added lines of precious
metals products and various specialty manufacturing operations, including
stainless steel and specialty metal alloy products, for industrial users in a
wide range of applications in the electrical, electronic, automotive original
equipment, office equipment, oil and other energy-related, refrigeration,
utility, telecommunications and medical industries. In September 1994, the
Company acquired Sumco Inc., a precision electroplating firm, which
electroplates electronic connector and connector stock for the automotive,
telecommunications, electronic and computer industries.
The Company's business segments are manufacturing and selling (a)
non-precious metal wire, cable and tubing products composed primarily of
stainless steel and specialty alloys; (b) precious metal precision plating and
surface finishing and other precious metal manufactured products; and (c) other
specialty products supplied to natural gas, electrical and water utility
companies.
Historical Financial Information. The following table sets forth summary
historical consolidated financial information of the Company and its
subsidiaries. The historical financial information for fiscal years 1994 and
1995 (other than the ratios of earnings to fixed charges) has been derived from,
and should be read in conjunction with, the audited consolidated financial
statements of the Company as reported in the Company's Annual Reports on Form
10-K for the fiscal years ended December 31, 1995 and December 31, 1994 and is
hereby incorporated herein by reference. In addition, the historical financial
information for that portion of fiscal year 1996 presented is unaudited. Such
historical financial information for fiscal year 1996 was set forth in the
Company's Quarterly Report on Form 10-Q for the quarter and six months ended
June 30, 1996 and is hereby incorporated herein by reference. The summary
historical financial information should be read in conjunction with, and is
qualified in its entirety by reference to, the audited financial statements and
the related notes thereto from which it has been derived. Copies of reports may
be inspected or obtained from the Commission in the manner specified in
"-- Additional Information" below.
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<PAGE> 22
SUMMARY HISTORICAL CONSOLIDATED FINANCIAL INFORMATION(1)
(IN THOUSANDS, EXCEPT RATIOS AND PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
YEAR ENDED SIX MONTHS ENDED
----------------------------- ---------------------
DECEMBER 31, DECEMBER 31, JUNE 30, JUNE 30,
1994 1995 1995 1996
------------ ------------ -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C>
STATEMENT OF INCOME DATA
Revenue................................... $408,968 $427,188 $228,090 $214,146
Income from continuing operations
before taxes........................... 11,567 14,286 6,096 15,503
Income from continuing operations......... 6,743 7,509 2,816 8,817
Gain (loss) from discontinued
operations............................. 9,768 11,131 1,251 (9,654)
Net income (loss)......................... 16,511 18,640 4,067 (837)
Earnings per common share:
Income from continuing operations...... $ 0.48 $ 0.53 $ 0.20 $ 0.63
Gain (loss) from discontinued
operations........................... 0.70 0.79 0.09 (0.69)
Net income (loss)...................... $ 1.18 $ 1.32 $ 0.29 $ (0.06)
Average shares outstanding................ 14,050 14,092 14,095 14,027
Ratio of earnings to fixed charges(2)..... 2.07 2.13 1.90 4.70
</TABLE>
<TABLE>
<CAPTION>
AT AT
----------------------------- ---------------------
DECEMBER 31, DECEMBER 31, JUNE 30, JUNE 30,
1994 1995 1995 1996
------------ ------------ -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C>
BALANCE SHEET DATA
Working capital........................... $ 33,743 $ 49,480 $ 37,218 $ 32,747
Total assets.............................. 405,018 341,049 421,365 325,935
Total assets less excess of purchase price
over net assets acquired in business
combinations........................... 382,731 319,363 399,327 301,299
Total long-term debt(3)................... 131,750 93,500 112,000 83,500
Shareholders' equity...................... 106,124 120,394 108,164 116,707
Book value per common share............... $ 7.54 $ 8.59 $ 7.67 $ 8.31
</TABLE>
- ---------------
NOTES TO SUMMARY HISTORICAL CONSOLIDATED FINANCIAL INFORMATION
(1) Revenue and expenses for the periods presented have been restated to reflect
the sale of the Company's Refining Division business accounted for as a
discontinued operation.
(2) The ratio of earnings to fixed charges has been computed by dividing the sum
of income from continuing operations before taxes and interest expense from
continuing operations by interest expense from continuing operations.
(3) Subsequent Event: On October 10, 1996, the Company repaid $64,500,000 of its
long-term indebtedness with proceeds from its existing credit facilities; in
connection therewith, the Company was required to pay a make-whole payment
of $4,477,962.
Pro Forma Financial Information. The following summary unaudited
consolidated pro forma financial information gives effect to the purchase of
Shares pursuant to the Offer, based on certain assumptions described in the
Notes to Summary Unaudited Consolidated Pro Forma Financial Information and
gives effect to the purchase of Shares pursuant to the Offer as if it had
occurred on January 1, 1995. The pro forma financial information should be read
in conjunction with the historical consolidated financial information
incorporated herein by reference and does not purport to be indicative of the
results that would actually have
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<PAGE> 23
been obtained had the purchase of the Shares pursuant to the Offer been
completed at the dates indicated or that may be obtained in the future.
SUMMARY UNAUDITED CONSOLIDATED PRO FORMA FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT RATIOS AND PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEAR ENDED DECEMBER 31, 1995 JUNE 30, 1996
--------------------------------- ---------------------------------
PRO FORMA PRO FORMA
-------------------- --------------------
AT $20 AT $17.50 AT $20 AT $17.50
PURCHASE PURCHASE PURCHASE PURCHASE
HISTORICAL PRICE PRICE HISTORICAL PRICE PRICE
---------- -------- --------- ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
STATEMENT OF INCOME DATA
Revenue............................................. $427,188 $427,188 $427,188 $214,146 $214,146 $214,146
Income from continuing operations before taxes...... 14,286 49,537 49,811 15,503 15,153 15,290
Income from continuing operations................... 7,509 28,307 28,469 8,817 8,622 8,700
Gain (loss) from discontinued operations............ 11,131 11,131 11,131 (9,654) (9,654) (9,654 )
Net income (loss)................................... 18,640 39,438 39,600 (837) (1,032) (954 )
Earnings per common share:
Income from continuing operations................. $ 0.53 $ 2.30 $ 2.32 $ 0.63 $ 0.71 $ 0.71
Gain (loss) from discontinued operations.......... 0.79 0.90 0.90 (0.69) (0.79) (0.79 )
Net income (loss)................................. $ 1.32 $ 3.20 $ 3.22 $ (0.06) $ (0.08) $ (0.08 )
Average shares outstanding.......................... 14,092 12,292 12,292 14,027 12,227 12,227
Ratio of earnings to fixed charges.................. 2.13 4.72 4.82 4.70 4.34 4.48
</TABLE>
<TABLE>
<CAPTION>
AT DECEMBER 31, 1995 AT JUNE 30, 1996
--------------------------------- ---------------------------------
PRO FORMA PRO FORMA
-------------------- --------------------
AT $20 AT $17.50 AT $20 AT $17.50
PURCHASE PURCHASE PURCHASE PURCHASE
HISTORICAL PRICE PRICE HISTORICAL PRICE PRICE
---------- -------- --------- ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
BALANCE SHEET DATA
Working capital..................................... $ 49,480 $ 45,277 $ 45,439 $ 32,747 $ 28,457 $ 28,697
Total assets........................................ 341,049 336,846 337,008 325,935 321,537 321,777
Total assets less excess of purchase price over net
assets acquired in business combinations.......... 319,363 315,160 315,322 301,299 296,901 297,141
Total long-term debt................................ 93,500 104,567 100,067 83,500 94,351 89,851
Shareholders' equity................................ 120,394 105,124 109,786 116,707 104,071 108,811
Book value per common share......................... $ 8.59 $ 8.61 $ 8.99 $ 8.31 $ 8.50 $ 8.89
</TABLE>
- ---------------
NOTES TO SUMMARY UNAUDITED CONSOLIDATED PRO FORMA FINANCIAL INFORMATION
The following assumptions regarding the Offer were made in arriving at the
pro forma financial information:
(1) Revenue and expenses for the periods presented have been restated to
reflect the sale of the Company's Refining Division business accounted
for as a discontinued operation.
(2) The information assumes 1,800,000 Shares are repurchased and retired at
a $20 per Share price and at a $17.50 per Share price, respectively. A
portion of the repurchase was assumed to be financed from cash
generated from the sale of 100,000 ounces of gold at $380.00 per ounce
and 4,430 ounces of platinum at $393.00 per ounce. The sale of these
LIFO metals will result in an after tax gain of $21,212,000 and cash
flow of approximately $25,000,000. The remainder of the repurchase was
assumed to be financed through long-term debt. It was assumed that
these transactions took place on January 1, 1995.
(3) Income before taxes was increased in 1995 by $35,952,000 for LIFO
profits from the sale of the precious metals described above. Interest
expense was increased for the periods presented for the additional
long-term debt assumed to be used to finance the repurchase of Shares
as of January 1, 1995. The assumed interest rate on the additional
borrowings was 6.1%.
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<PAGE> 24
(4) Income taxes on LIFO profits and increased interest were computed at an
assumed marginal rate of 41% for 1995 and on increased interest for
1996 at 43.1%.
(5) Expenses directly related to the Offer are assumed to be $500,000 and
are charged against shareholders' equity.
(6) The ratio of earnings to fixed charges has been computed by dividing
the sum of income from continuing operations before taxes and interest
expense from continuing operations by interest expense from continuing
operations.
Additional Information. The Company is subject to the informational filing
requirements of the Exchange Act and, in accordance therewith, is obligated to
file reports and other information with the Commission relating to its business,
financial condition and other matters. Information, as of particular dates,
concerning the Company's directors and officers, their remuneration, options
granted to them, the principal holders of the Company's securities and any
material interest of such persons in transactions with the Company is required
to be disclosed in proxy statements distributed to the Company's shareholders
and filed with the Commission. Such reports, proxy statements and other
information can be inspected and copied at the public reference facilities
maintained by the Commission at 450 Fifth Street, N.W., Room 2120, Washington,
D.C. 20549; at its regional offices located at 500 West Madison Street, Suite
1400, Chicago, Illinois 60661-2511; and 7 World Trade Center, New York, New York
10048. Copies of such material may also be obtained by mail, upon payment of the
Commission's customary charges, from the Public Reference Section of the
Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington D.C. 20549.
The Commission also maintains a Web site on the World Wide Web at
http://www.sec.gov that contains reports, proxy and information statements and
other information regarding registrants that file electronically with the
Commission. Such reports, proxy statements and other information concerning the
Company also can be inspected at the offices of the NYSE, 20 Broad Street, New
York, New York 10005, on which the Shares are listed.
12. EFFECTS OF THE OFFER ON THE MARKET FOR SHARES; REGISTRATION UNDER THE
EXCHANGE ACT
The Company's purchase of Shares pursuant to the Offer will reduce the
number of Shares that might otherwise trade publicly and is likely to reduce the
number of shareholders. Nonetheless, the Company believes that there will still
be a sufficient number of Shares outstanding and publicly traded following the
Offer to ensure a continued trading market in the Shares. Based on the published
guidelines of the NYSE, the Company does not believe that its purchase of Shares
pursuant to the Offer will cause its remaining Shares to be delisted from such
exchange.
The Shares are currently "margin securities" under the rules of the Federal
Reserve Board. This has the effect, among other things, of allowing brokers to
extend credit on the collateral of the Shares. The Company believes that,
following the purchase of Shares pursuant to the Offer, the Shares will continue
to be "margin securities" for purposes of the Federal Reserve Board's margin
regulations.
The Shares are registered under the Exchange Act, which requires, among
other things, that the Company furnish certain information to its shareholders
and to the Commission and comply with the Commission's proxy rules in connection
with meetings of the Company's shareholders. The Company believes that its
purchase of Shares pursuant to the Offer will not result in the Shares becoming
eligible for deregistration under the Exchange Act.
13. CERTAIN LEGAL MATTERS; REGULATORY APPROVALS
The Company is not aware of any license or regulatory permit material to
its business that might be adversely affected by its acquisition of Shares as
contemplated in the Offer or of any approval or other action by any government
or governmental, administrative or regulatory authority or agency, domestic or
foreign, that would be required for the Company's acquisition or ownership of
Shares as contemplated by the Offer. Should any such approval or other action be
required, the Company currently contemplates that it will seek such approval or
other action. The Company cannot predict whether it may determine that it is
required to delay the acceptance for payment of, or payment for, Shares tendered
pursuant to the Offer pending the outcome of any such matter. There can be no
assurance that any such approval or other action, if needed, would be obtained
or would be obtained without substantial conditions or that the failure to
obtain any such approval or
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<PAGE> 25
other action might not result in adverse consequences to the Company's business.
The Company's obligations under the Offer to accept for payment and pay for
Shares are subject to certain conditions. See Section 6.
The consent of certain banks under credit agreements with the Company was
required to permit the making of the Offer; such consents were obtained prior to
the date hereof.
14. CERTAIN U.S. FEDERAL INCOME TAX CONSEQUENCES
The following summary describes certain United States federal income tax
consequences relevant to the Offer. The discussion contained in this summary is
based upon the Internal Revenue Code of 1986, as amended to the date hereof (the
"Code"), existing and proposed Treasury regulations promulgated thereunder,
rulings, administrative pronouncements and judicial decisions, changes to which
could materially affect the tax consequences described herein and could be made
on a retroactive basis.
This summary discusses only Shares held as capital assets, within the
meaning of Section 1221 of the Code, and does not address all of the tax
consequences that may be relevant to particular shareholders in light of their
personal circumstances, or to certain types of shareholders (such as certain
financial institutions, dealers in securities or commodities, insurance
companies, tax-exempt organizations or persons who hold Shares as a position in
a "straddle" or as a part of a "hedging" or "conversion" transaction for United
States federal income tax purposes). In particular, the discussion of the
consequences of an exchange of Shares for cash pursuant to the Offer applies
only to a United States Holder. For purposes of this summary, a "United States
Holder" is a holder of Shares that is (a) a citizen or resident of the United
States, (b) a corporation, partnership or other entity created or organized in
or under the laws of the United States, any state or any political subdivision
thereof, or (c) an estate or trust the income of which is subject to United
States federal income taxation regardless of its source. This discussion does
not address the tax consequences to foreign shareholders who will be subject to
United States federal income tax on a net basis on the proceeds of their
exchange of Shares pursuant to the Offer because such income is effectively
connected with the conduct of a trade or business within the United States. Such
shareholders are generally taxed in a manner similar to United States Holders;
however, certain special rules apply. Foreign shareholders who are not subject
to United States federal income tax on a net basis should see Section 3 for a
discussion of the applicable United States withholding rules and the potential
for obtaining a refund of all or a portion of the tax withheld. The summary may
not be applicable with respect to Shares acquired as compensation (including
Shares acquired upon the exercise of options or which were or are subject to
forfeiture restrictions). The summary also does not address the state, local or
foreign tax consequences of participating in the Offer. EACH SHAREHOLDER SHOULD
CONSULT SUCH SHAREHOLDER'S TAX ADVISOR AS TO THE PARTICULAR CONSEQUENCES OF
PARTICIPATION IN THE OFFER.
United States Holders Who Receive Cash Pursuant to the Offer. An exchange
of Shares for cash pursuant to the Offer by a United States Holder will be a
taxable transaction for United States federal income tax purposes. As a
consequence of the exchange, a United States Holder will, depending on such
holder's particular circumstances, be treated either as having sold such
holder's Shares or as having received a dividend distribution from the Company,
with the tax consequences described below.
Under Section 302 of the Code, a United States Holder whose Shares are
exchanged for cash pursuant to the Exchange will be treated as having sold such
holder's Shares, and thus will recognize gain or loss if the exchange (a)
results in a "complete termination" of such holder's equity interest in the
Company, (b) is "substantially disproportionate" with respect to such holder or
(c) is "not essentially equivalent to a dividend" with respect to the holder,
each as discussed below. In applying these tests, a United States Holder will be
treated as owing Shares actually or constructively owned by certain related
individuals and entities.
If a United States Holder sells Shares to persons other than the Company at
or about the time such holder also sells Shares to the Company pursuant to the
Offer, and the various sales effected by the holder are part of an overall plan
to reduce or terminate such holder's proportionate interest in the Company, then
the sales to persons other than the Company may, for United States federal
income tax purposes, be integrated with the holder's sale of Shares pursuant to
the Offer and, if integrated, should be taken into account in determining
whether the holder satisfies any of the three tests described below.
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<PAGE> 26
A United States Holder that exchanges all Shares actually or constructively
owned by such holder for cash pursuant to the Offer will be treated as having
completely terminated such holder's equity interest in the Company.
An exchange of Shares for cash will be "substantially disproportionate"
with respect to a United States Holder if the percentage of the then outstanding
Shares actually and constructively owned by such holder immediately after the
exchange is less than 80% of the percentage of the Shares actually and
constructively owned by such holder immediately before the exchange.
A United States Holder will satisfy the "not essentially equivalent to a
dividend" test if the reduction in such holder's proportionate interest in the
Company constitutes a "meaningful reduction" given such holder's particular
facts and circumstances. The IRS has indicated in published rulings that any
reduction in the percentage interest of a shareholder whose relative stock
interest in a publicly held corporation is minimal (an interest of less than 1%
should satisfy this requirement) and who exercises no control over corporate
affairs should constitute such a "meaningful reduction."
If a United States Holder is treated as having sold such holder's Shares
under the tests described above, such holder will recognize gain or loss equal
to the difference between the amount of cash received and such holder's tax
basis in the Shares exchanged therefor. Any such gain or loss will be capital
gain or loss and will be long-term capital gain or loss if the holding period of
the Shares exceeds one year as of the date of the exchange.
If a United States Holder who exchanges Shares pursuant to the Offer is not
treated under Section 302 as having sold such holder's Shares for cash, the
entire amount of cash received by such holder will be treated as a dividend to
the extent of the Company's current and accumulated earnings and profits, which
the Company anticipates will be sufficient to cover the amount of any such
dividend and will be includible in the holder's gross income as ordinary income
in its entirety, without reduction for the tax basis of the Shares exchanged. No
loss will be recognized. The United States Holder's tax basis in the Shares
exchanged generally will be added to such holder's tax basis in such holder's
remaining Shares. To the extent that cash received in exchange for Shares is
treated as a dividend to a corporate United States Holder, such holder will be
(i) eligible for a dividends-received deduction (subject to applicable
limitations) and (ii) subject to the "extraordinary dividend" provisions of the
Code. To the extent, if any, that the cash received by a United States Holder
exceeds the Company's current and accumulated earnings and profits, it will be
treated first as a tax-free return of such holder's tax basis in the Shares and
thereafter as capital gain.
The Company cannot predict whether or to what extent the Offer will be
oversubscribed. If the Offer is oversubscribed, proration of tenders pursuant to
the Offer will cause the Company to accept fewer Shares than are tendered.
Therefore, a holder can be given no assurance that a sufficient number of such
holder's Shares will be exchanged pursuant to the Offer to ensure that such
exchange will be treated as a sale, rather than as a dividend, for United States
federal income tax purposes pursuant to the rules discussed above.
Shareholders Who Do Not Receive Cash Pursuant to the Offer. Shareholders
whose Shares are not exchanged pursuant to the Offer will not incur any tax
liability as a result of the consummation of the Offer.
Participants in the Savings Plan may have additional tax considerations.
See the Direction Form and related materials sent under separate cover to such
participants.
See Section 3 with respect to the application of United States federal
income tax withholding to payments made to foreign shareholders and backup
withholding.
THE TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL INFORMATION
ONLY. EACH SHAREHOLDER IS URGED TO CONSULT SUCH HOLDER'S OWN TAX ADVISOR TO
DETERMINE THE PARTICULAR TAX CONSEQUENCES TO HIM OR HER OF THE OFFER, INCLUDING
THE APPLICABILITY AND EFFECT OF STATE, LOCAL AND FOREIGN TAX LAWS.
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<PAGE> 27
15. EXTENSION OF THE OFFER; TERMINATION; AMENDMENTS
The Company expressly reserves the right, in its sole discretion, at any
time and from time to time, and regardless of whether or not any of the events
set forth in Section 6 shall have occurred or shall be deemed by the Company to
have occurred, to extend the period of time during which the Offer is open and
thereby delay acceptance for payment of, and payment for, any Shares by giving
oral or written notice of such extension to the Depositary and making a public
announcement thereof. The Company also expressly reserves the right, in its sole
discretion, to terminate the Offer and not accept for payment or pay for any
Shares not theretofore accepted for payment or paid for or, subject to
applicable law, to postpone payment for Shares upon the occurrence of any of the
conditions specified in Section 6 hereof by giving oral or written notice of
such termination or postponement to the Depositary and making a public
announcement thereof. Additionally, in certain circumstances, if the Company
waives any of the conditions of the Offer set forth in Section 6, it may be
required to extend the Expiration Date of the Offer. The Company's reservation
of the right to delay payment for Shares that it has accepted for payment is
limited by Rule 13e-4(f)(5) promulgated under the Exchange Act, which requires
that the Company must pay the consideration offered or return the Shares
tendered promptly after termination or withdrawal of a tender offer. Subject to
compliance with applicable law, the Company further reserves the right, in its
sole discretion, and regardless of whether any of the events set forth in
Section 6 shall have occurred or shall be deemed by the Company to have
occurred, to amend the Offer in any respect (including, without limitation, by
decreasing or increasing the consideration offered in the Offer to holders of
Shares or by decreasing or increasing the number of Shares being sought in the
Offer). Amendments to the Offer may be made at any time and from time to time
effected by public announcement thereof, such announcement, in the case of an
extension, to be issued no later than 9:00 A.M., New York City time, on the next
business day after the last previously scheduled or announced Expiration Date.
Any public announcement made pursuant to the Offer will be disseminated promptly
to shareholders in a manner reasonably designated to inform shareholders of such
change. Without limiting the manner in which the Company may choose to make any
public announcement, except as provided by applicable law (including Rule
13e-4(e)(2) promulgated under the Exchange Act), the Company shall have no
obligation to publish, advertise or otherwise communicate any such public
announcement other than by making a release to the Dow Jones News Service.
If the Company 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, the Company will extend the Offer to the extent required by Rules
13e4(d)(2) and 13e-4(e)(2) promulgated under the Exchange Act, which require
that the minimum period during which an 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 such terms or information. If (i) the Company increases or decreases the
price to be paid for Shares, the Company increases or decreases the Dealer
Manager's fee, the Company increases the number of Shares being sought and such
increase in the number of Shares being sought exceeds 2% of the outstanding
Shares, or the Company decreases the number of Shares being sought, and (ii) the
Offer is scheduled to expire at any time earlier than the expiration of a period
ending on the tenth business day from, and including, the date that notice of
such increase or decrease is first published, sent or given, the Offer will be
extended until the expiration of such period of ten business days.
16. FEES AND EXPENSES
The Company has retained J.P. Morgan Securities Inc. ("J.P. Morgan") to act
as the Dealer Manager in connection with the Offer. J.P. Morgan will receive a
fee of $175,000 for its services as Dealer Manager and an advisory fee of
$100,000. The Company also has agreed to reimburse J.P. Morgan for certain
expenses incurred in connection with the Offer, including out-of-pocket expenses
and reasonable attorney's fees and disbursements, and to indemnify J.P. Morgan
against certain liabilities in connection with the Offer, including certain
liabilities under the federal securities laws. J.P. Morgan has rendered various
investment banking and other advisory services to the Company in the past, for
which it has received customary compensation, and can be expected to render
similar services to the Company in the future. The Company also has retained
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<PAGE> 28
Georgeson & Company Inc. as Information Agent and ChaseMellon Shareholder
Services, L.L.C. as Depositary in connection with the Offer. The Information
Agent and the Depositary will receive reasonable and customary compensation for
their services. The Company will also reimburse the Information Agent and the
Depositary for out-of-pocket expenses, including reasonable attorneys' fees, and
has agreed to indemnify the Information Agent and the Depositary against certain
liabilities in connection with the Offer, including certain liabilities under
the federal securities laws. The Dealer Manager and Information Agent may
contact shareholders by mail, telephone, telex, telegraph and personal
interviews, and may request brokers, dealers and other nominee shareholders to
forward materials relating to the Offer to beneficial owners. Neither the
Information Agent nor the Depositary has been retained to make solicitations or
recommendations in connection with the Offer.
The Company will not pay fees or commissions to any broker, dealer,
commercial bank, trust company or other person (other than the Dealer Manager)
for soliciting any Shares pursuant to the Offer. The Company will, however, on
request, reimburse such persons for customary handling and mailing expenses
incurred in forwarding materials in respect of the Offer to the beneficial
owners for which they act as nominees. No such broker, dealer, commercial bank
or trust company has been authorized to act as the Company's agent for purposes
of the Offer. The Company will pay (or cause to be paid) any stock transfer
taxes on its purchase of Shares, except as otherwise provided in Instruction 7
of the Letter of Transmittal.
17. MISCELLANEOUS
The Company is not aware of any jurisdiction where the making of the Offer
is not in compliance with applicable law. If the Company becomes aware of any
jurisdiction where the making of the Offer is not in compliance with any valid
applicable law, the Company will make a good faith effort to comply with such
law. If, after such good faith effort, the Company cannot comply with such law,
the Offer will not be made to (nor will tenders be accepted from or on behalf
of) the holders of Shares residing in such jurisdiction. In any jurisdiction the
securities or blue sky laws of which require the Offer to be made by a licensed
broker or dealer, the Offer is being made on the Company's behalf by the Dealer
Manager or one or more registered brokers or dealers licensed under the laws of
such jurisdiction.
Pursuant to Rule 13e-4 promulgated under the Exchange Act, the Company has
filed with the Commission an Issuer Tender Offer Statement on Schedule 13E-4
(the "Schedule 13E-4") which contains additional information with respect to the
Offer. The Schedule 13E-4, including the exhibits and any amendments thereto,
may be examined, and copies may be obtained, at the same places and in the same
manner as is set forth in Section 11 with respect to information concerning the
Company.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATION ON BEHALF OF THE COMPANY OR THE DEALER MANAGER IN CONNECTION WITH
THE OFFER OTHER THAN THOSE CONTAINED IN THIS OFFER TO PURCHASE OR IN THE RELATED
LETTER OF TRANSMITTAL. IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR THE DEALER
MANAGER.
HANDY & HARMAN
October 24, 1996
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SCHEDULE I
CERTAIN TRANSACTIONS INVOLVING SHARES
Except as set forth below, based upon the Company's records and upon
information provided to the Company by its directors, executive officers,
associates and subsidiaries, neither the Company nor any of its associates or
subsidiaries or persons controlling the Company (of which the Company believes
there are none) nor, to the best of the Company's knowledge, any of the
directors or executive officers of the Company or any of its subsidiaries, nor
any associates or subsidiary of any of the foregoing, has effected any
transactions in the Shares during the 40 business days prior to October 24,
1996.
1. The Company has repurchased an aggregate of 26,600 Shares at prices
ranging from $17.25 to $17.75 pursuant to its ongoing Share Repurchase Program,
each in market purchases on the NYSE, as set forth in the table below:
<TABLE>
<CAPTION>
NUMBER OF
DATE SHARES PRICE(1)
------------------------------------------------------ --------- ------
<S> <C> <C>
9/3/96................................................ 25,000 $17.25
9/24/96............................................... 800 $17.75
9/25/96............................................... 600 $17.75
9/26/96............................................... 200 $17.75
</TABLE>
- ---------------
(1) Exclusive of brokerage commission.
2. The Company issued Options to purchase an aggregate of 140,000 Shares to
the Company's executive officers on September 26, 1996 under the Company's 1995
Omnibus Stock Incentive Plan, as set forth in the table below:
<TABLE>
<CAPTION>
NUMBER OF
NAME OPTIONS GRANTED EXERCISE PRICE
-------------------------------------------------- --------------- --------------
<S> <C> <C>
R.N. Daniel....................................... 50,000 $17.75
F.E. Grzelecki.................................... 40,000 $17.75
R.F. Burlinson.................................... 15,000 $17.75
P.E. Dixon........................................ 15,000 $17.75
J.M. McLoone...................................... 5,000 $17.75
S.B. Mudd......................................... 5,000 $17.75
D.C. Kelly........................................ 10,000 $17.75
</TABLE>
3. Paul E. Dixon, Vice President, General Counsel and Secretary of the
Company, exercised options to purchase 2,000 Shares at a price of $12.937 per
Share on September 23, 1996, and sold such acquired Shares at a price of $17.75
on such date.
4. Robert E. Cornelia, a director of the Company, exercised options to
purchase 699 Shares at a price of $1.00 per Share on September 26, 1996.
S-1
<PAGE> 30
Manually signed facsimile copies of the Letter of Transmittal will be
accepted. The Letter of Transmittal and certificates for the Shares and any
other required documents should be sent or delivered by each shareholder or such
shareholder's broker, dealer, commercial bank, trust company or other nominee to
the Depositary at its address set forth below:
The Depositary for the Offer is:
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
<TABLE>
<S> <C> <C>
By Mail: By Facsimile Transmission: By Hand or By Overnight
Courier:
Reorganization Department (201) 329-8936 Reorganization Department
Midtown Station 120 Broadway - 13th Floor
P.O. Box 798 New York, New York 10271
New York, New York 10018
</TABLE>
Confirm Receipt of Notice of Guaranteed Delivery:
(201) 296-4983
Any questions or requests for assistance or for additional copies of this
Offer to Purchase, the Letter of Transmittal or the Notice of Guaranteed
Delivery may be directed to the Information Agent, at the telephone number and
address below. Shareholders may also contact their broker, dealer, commercial
bank or trust company for assistance concerning the Offer.
The Information Agent for the Offer is:
GEORGESON & COMPANY INC.
Wall Street Plaza
New York, New York 10005
Toll Free: (800) 223-2064
Bank & Brokers Call Collect: (212) 440-9800
The Dealer Manager for the Offer is:
J.P. MORGAN SECURITIES INC.
60 Wall Street
New York, New York 10260-0060
Toll Free: (800) 576-9843
(212) 648-7833
<PAGE> 1
LETTER OF TRANSMITTAL
TO TENDER SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS)
OF
HANDY & HARMAN
PURSUANT TO THE OFFER TO PURCHASE DATED OCTOBER 24, 1996
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON THURSDAY, NOVEMBER 21, 1996,
UNLESS THE OFFER IS EXTENDED.
THE DEPOSITARY FOR THE OFFER IS:
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
<TABLE>
<S> <C> <C>
By Mail: By Facsimile Transmission: By Hand or Overnight Courier:
Reorganization Department (201) 329-8936 Reorganization Department
Midtown Station Confirm Receipt of Notice of 120 Broadway - 13th Floor
P.O. Box 798 Guaranteed Delivery: New York, NY 10271
New York, NY 10018 (201) 296-4983
</TABLE>
- --------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
(SEE INSTRUCTIONS 3 AND 4)
<TABLE>
<S> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN EXACTLY AS NAME(S) SHARES TENDERED
APPEAR(S) ON CERTIFICATE(S)) (ATTACH ADDITIONAL
SIGNED LIST
IF NECESSARY)
------------------------------------------------------------------------------------------------------------------------------
TOTAL NUMBER
OF SHARES NUMBER
CERTIFICATE REPRESENTED BY OF SHARES
NUMBER(s)(1) CERTIFICATE(s) TENDERED(2)
--------------
--------------
--------------
--------------
TOTAL SHARES:
------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Indicate in this box the order (by certificate number) in which Shares are to
be purchased in the event of proration.(3) (Attach additional signed list if
necessary.) See Instruction 15.
1st: 2nd: 3rd: 4th: 5th:
- --------------------------------------------------------------------------------
(1) Need not be completed by shareholders tendering Shares by book-entry
transfer.
(2) Unless otherwise indicated, it will be assumed that all Shares represented
by each Share certificate delivered to the Depositary are being tendered
hereby. See Instruction 4.
(3) If you do not designate an order, then in the event less than all Shares
tendered are purchased due to proration, Shares will be selected for
purchase by the Depositary. See Instruction 15.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NOTE: SIGNATURES MUST BE PROVIDED BELOW. PLEASE READ THE INSTRUCTIONS SET FORTH
IN THIS LETTER OF TRANSMITTAL CAREFULLY.
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE
WILL NOT CONSTITUTE A VALID DELIVERY. DELIVERIES TO THE COMPANY WILL NOT
BE FORWARDED TO THE DEPOSITARY AND THEREFORE WILL NOT CONSTITUTE VALID
DELIVERY. DELIVERIES TO BOOK-ENTRY TRANSFER FACILITIES WILL NOT CONSTITUTE
VALID DELIVERY TO THE DEPOSITARY.
/ / Check here if you cannot locate your certificates and require
assistance in replacing them. Upon receipt of this Letter of
Transmittal, the Depositary will contact you directly with replacement
instructions.
<PAGE> 2
This Letter of Transmittal is to be used only if certificates are to be
forwarded herewith or if delivery of Shares (as defined below) is to be made by
book-entry transfer to the Depositary's account at The Depository Trust Company
("DTC") or the Philadelphia Depository Trust Company ("PDTC") (hereinafter
collectively referred to as the "Book Entry Transfer Facilities") pursuant to
the procedures set forth in Section 3 of the Offer to Purchase (as defined
below). THIS LETTER OF TRANSMITTAL MAY NOT BE USED TENDERING FOR SHARES
REFLECTING INTERESTS IN THE COMPANY STOCK FUND CREDITED TO ACCOUNTS IN THE
COMPANY'S 401(k) SAVINGS PLAN (THE "SAVINGS PLAN"). SEE INSTRUCTION 14.
Shareholders who cannot deliver their Share certificates and any other
required documents to the Depositary by the Expiration Date (as defined in the
Offer to Purchase) must tender their Shares using the guaranteed delivery
procedure set forth in Section 3 of the Offer to Purchase. See Instruction 2.
- --------------------------------------------------------------------------------
(BOXES BELOW FOR USE BY ELIGIBLE INSTITUTIONS ONLY)
/ / 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 Applicable Box: / / DTC / / PDTC
Account No.
Transaction Code No.
/ / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE
FOLLOWING:
Name(s) of Registered Holder(s)
Date of Execution of Notice of Guaranteed Delivery
Name of Institution that Guaranteed Delivery
If delivery is by book-entry transfer:
Name of Tendering Institution
Account No. ____________ at / / DTC / / PDTC
Transaction Code No.
2
<PAGE> 3
LADIES AND GENTLEMEN:
The undersigned hereby tenders to Handy & Harman, a New York corporation
(the "Company"), the above-described shares of its common stock, par value $1.00
per share (including the associated common stock purchase rights) (the
"Shares"), at the price per Share indicated in this Letter of Transmittal, net
to the seller in cash, upon the terms and subject to the conditions set forth in
the Offer to Purchase, dated October 24, 1996 (the "Offer to Purchase"), receipt
of which is hereby acknowledged, and in this Letter of Transmittal (which, as
amended from time to time, together constitute the "Offer").
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with 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), the undersigned hereby
sells, assigns and transfers to, or upon the order of, the Company all right,
title and interest in and to all the Shares that are being tendered hereby or
orders the registration of such Shares tendered by book-entry transfer that are
purchased pursuant to the Offer to or upon the order of the Company and hereby
irrevocably constitutes and appoints the Depositary the true and lawful agent
and attorney-in-fact of the undersigned with respect to such Shares, 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, or transfer ownership of
such Shares on the account books maintained by any of the Book-Entry
Transfer Facilities, together, in any such case, with all accompanying
evidences of transfer and authenticity, to or upon the order of the Company
upon receipt by the Depositary, as the undersigned's agent, of the Purchase
Price (as defined below) with respect to such Shares;
(ii) present certificates for such Shares for cancellation and
transfer on the books of the Company; and
(iii) receive all benefits and otherwise exercise all rights of
beneficial ownership of such Shares, all in accordance with the terms of
the Offer.
The undersigned hereby represents and warrants to the Company that the
undersigned has full power and authority to tender, sell, assign and transfer
the Shares tendered hereby and that, when and to the extent the same are
accepted for payment by the Company, the Company will acquire good, marketable
and unencumbered title thereto, free and clear of all liens, restrictions,
charges, encumbrances, conditional sales agreements or other obligations
relating to the sale or transfer thereof, and the same will not be subject to
any adverse claims. The undersigned will, upon request, execute and deliver any
additional documents deemed by the Depositary or the Company to be necessary or
desirable to complete the sale, assignment and transfer of the Shares tendered
hereby.
The undersigned represents and warrants to the Company that the undersigned
has read and agrees to all of the terms of the Offer. All authority herein
conferred or agreed to be conferred shall not be affected by, and shall survive
the death or incapacity of the undersigned, and any obligation of the
undersigned hereunder shall be binding upon the heirs, personal representatives,
successors and assigns of the undersigned. Except as stated in the Offer, this
tender is irrevocable.
The undersigned understands that tenders of Shares pursuant to any one of
the procedures described in Section 3 of the Offer to Purchase and in the
Instructions will constitute the undersigned's acceptance of the terms and
conditions of the Offer, including the undersigned's representation and warranty
to the Company that (i) the undersigned has a net long position in the Shares or
equivalent securities being tendered within the meaning of Rule 14e-4
promulgated under the Securities Exchange Act of 1934, as amended, and (ii) the
tender of such Shares complies with Rule 14e-4. The Company's acceptance for
payment of Shares tendered pursuant to the Offer will constitute a binding
agreement between the undersigned and the Company upon the terms and subject to
the conditions of the Offer.
The names and addresses of the registered holders should be printed, if
they are not already printed above, exactly as they appear on the certificates
representing Shares tendered hereby. The certificate numbers, the number of
Shares represented by such certificates, the number of Shares that the
undersigned wishes to tender and the purchase price at which such Shares are
being tendered should be indicated in the appropriate boxes on this Letter of
Transmittal.
The undersigned understands that the Company will determine a single per
Share price (not greater than $20.00 nor less than $17.50 per Share), net to the
Seller in cash, that it will pay for Shares validly tendered and not withdrawn
pursuant to the Offer (the "Purchase Price"), taking into account the number of
Shares so tendered and the prices specified by tendering shareholders. The
undersigned understands that the Company will select the lowest Purchase Price
that will allow it to purchase 1,800,000 Shares (or such lesser number of Shares
as are validly tendered at prices not greater than $20.00 nor less than $17.50
per Share) validly tendered and not withdrawn pursuant to the Offer. The
undersigned understands that all Shares validly tendered at prices at or below
the Purchase Price and not withdrawn will be purchased at the Purchase Price,
net to the seller in cash, upon the terms and subject to the conditions of the
Offer, including the proration provisions, and that the Company will return all
other Shares, including Shares tendered at prices greater than the Purchase
Price and not withdrawn and Shares not purchased because of proration.
3
<PAGE> 4
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase, the Company may terminate or amend the Offer or may
postpone the acceptance for payment of, or the payment for, Shares tendered or
may not be required to purchase any of the Shares tendered hereby or may accept
for payment fewer than all of the Shares tendered hereby.
Unless otherwise indicated under "Special Payment Instructions," please
issue the check for the Purchase Price of any Shares purchased, and/or return
any Shares not tendered or not purchased, in the name(s) of the undersigned
(and, in the case of Shares tendered by book-entry transfer, by credit to the
account at the applicable Book-Entry Transfer Facility). Similarly, unless
otherwise indicated under "Special Delivery Instructions," please mail the check
for the Purchase Price of any Shares purchased and/or any certificates for
Shares not tendered or not purchased (and accompanying documents, as
appropriate) to the undersigned at the address shown below the undersigned's
signature(s). In the event that both "Special Payment Instructions" and "Special
Delivery Instructions" are completed, please issue the check for the Purchase
Price of any Shares purchased and/or return any Shares not tendered or not
purchased in the name(s) of, and mail such check and/or any certificates to, the
person(s) so indicated. The undersigned recognizes that the Company has no
obligation, pursuant to the "Special Payment Instructions," to transfer any
Shares from the name of the registered holder(s) thereof if the Company does not
accept for payment any of the Shares so tendered.
The undersigned understands that a tender of Shares pursuant to the Offer
will include a tender of the associated common stock purchase rights (the
"Rights") and that no separate consideration will be paid for such Rights. For a
description of the Rights, see Section 7 of the Offer to Purchase.
The undersigned understands that acceptance of Shares by the Company for
payment will constitute a binding agreement between the undersigned and the
Company upon the terms and subject to the conditions of the Offer.
4
<PAGE> 5
NOTE: SIGNATURES MUST BE PROVIDED BELOW
PRICE (IN DOLLARS) PER SHARE
AT WHICH SHARES ARE BEING TENDERED
- --------------------------------------------------------------------------------
IF SHARES ARE BEING TENDERED AT MORE THAN ONE PRICE, A
SEPARATE LETTER OF TRANSMITTAL FOR EACH PRICE SPECIFIED
MUST BE USED. (See Instruction 5.)
- --------------------------------------------------------------------------------
CHECK ONLY ONE BOX. IF MORE THAN ONE BOX IS CHECKED, OR IF NO BOX IS CHECKED
(EXCEPT AS PROVIDED IN THE ODD LOTS BOX AND INSTRUCTIONS BELOW), THERE IS NO
VALID TENDER OF SHARES.
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C> <C>
/ / $17.50 / / $18.00 / / $18.50 / / $19.00 / / $19.50 / / $20.00
/ / $17.75 / / $18.25 / / $18.75 / / $19.25 / / $19.75
</TABLE>
ODD LOTS
(See Instruction 9.)
This section is to be completed ONLY if Shares are being tendered by or on
behalf of a person who owns beneficially, as of the close of business on October
23, 1996, and who continues to own beneficially as of the Expiration Date, an
aggregate of fewer than 100 Shares (including Shares reflecting interests in the
Company Stock Fund allocated to the Savings Plan but excluding Restricted Shares
(as defined in the Offer to Purchase)).
The undersigned either (check one box):
/ / owned beneficially, as of the close of business on October 23, 1996,
and continues to own beneficially as of the Expiration Date, an
aggregate of fewer than 100 Shares (including Shares reflecting
interests in the Company Stock Fund allocated to the Savings Plan but
excluding Restricted Shares), all of which are being tendered, or
/ / is a broker, dealer, commercial bank, trust company or other nominee
that (i) is tendering, for the beneficial owners thereof, Shares with
respect to which it is the record owner, and (ii) believes, based upon
representations made to it by each such beneficial owner, that such
beneficial owner owned beneficially, as of the close of business on
October 23, 1996, and continues to own beneficially as of the
Expiration Date, an aggregate of fewer than 100 Shares (including
Shares reflecting interests in the Company Stock Fund allocated to the
Savings Plan but excluding Restricted Shares) and is tendering all of
such Shares.
If you do not wish to specify a purchase price, check the following box, in
which case you will be deemed to have tendered at the Purchase Price determined
by the Company in accordance with the terms of the Offer (persons checking this
box need not indicate the price per Share in the box entitled "Price (In
Dollars) Per Share At Which Shares Are Being Tendered" in this Letter of
Transmittal). See Instruction 5. / /
5
<PAGE> 6
------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 6, 7 AND 8)
To be completed ONLY if the check for the aggregate Purchase Price of
Shares purchased and/or certificates for Shares not tendered or not
purchased are to be issued in the name of someone other than the
undersigned.
Issue: / / check and/or
/ / certificate(s) to:
Name
------------------------------------------------------------
------------------------------------------------------------
(PLEASE PRINT)
Address
------------------------------------------------------------
------------------------------------------------------------
(INCLUDE ZIP CODE)
------------------------------------------------------------
(TAXPAYER IDENTIFICATION OR
SOCIAL SECURITY NO.)
------------------------------------------------------------
------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 6 AND 8)
To be complete ONLY if the check for the Purchase Price of Shares
purchased and/or certificates for Shares not tendered or not purchased are
to be mailed to someone other than the undersigned or to the undersigned
at an address other than that shown below the undersigned's signature(s).
Mail: / / check and/or
/ / certificates to:
Name
------------------------------------------------------------
------------------------------------------------------------
(PLEASE PRINT)
Address
------------------------------------------------------------
------------------------------------------------------------
(INCLUDE ZIP CODE)
------------------------------------------------------------
6
<PAGE> 7
PLEASE SIGN HERE
(TO BE COMPLETED BY ALL SHAREHOLDERS)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SIGNATURE(S) OF OWNER(S)
Dated
- --------------------------- , 1996
Name(s) ------------------------------------------------------------------------
(PLEASE PRINT)
Capacity (full title)
-----------------------------------------------------------------
Address-------------------------------------------------------------------------
(INCLUDE ZIP CODE)
Area Code and Telephone No.
- --------------------------------------------------------------------------------
(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 a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other person acting in a
fiduciary or representative capacity, please set forth full title and see
Instruction 6.)
GUARANTEE OF SIGNATURE(S)
(SEE INSTRUCTIONS 1 AND 6.)
Name of Firm
---------------------------------------------------------------------
Authorized Signature
- --------------------------------------------------------------------------------
Name
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Title
- --------------------------------------------------------------------------------
Address
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
Area Code and Telephone No.
- --------------------------------------------------------------------------------
Dated
- --------------------------- , 1996
7
<PAGE> 8
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 or other
entity that is a member in good standing of the Security Transfer Agent's
Medallion Program, the New York Stock Exchange Medallion Program or the Stock
Exchange Medallion Program (an "Eligible Institution"), unless (i) this Letter
of Transmittal is signed by the registered holder(s) of the Shares (which term,
for purposes of this document, shall include any participant in a Book-Entry
Transfer Facility whose name appears on a security position listing as the owner
of Shares) tendered herewith and such holder(s) have not completed the box
entitled "Special Payment Instructions" or the box entitled "Special Delivery
Instructions" on this Letter of Transmittal, or (ii) such Shares are tendered
for the account of an Eligible Institution. See Instruction 6.
2. Delivery of Letter of Transmittal and Share Certificates; Guaranteed
Delivery Procedures. This Letter of Transmittal is to be used either if share
certificates are to be forwarded herewith or if delivery of Shares is to be made
by book-entry transfer pursuant to the procedures set forth in Section 3 of the
Offer to Purchase. Certificates for all physically delivered Shares, or a
confirmation of a book-entry transfer into the Depositary's account at one of
the Book-Entry Transfer Facilities of all Shares delivered electronically, as
well as a properly completed and duly executed Letter of Transmittal (or
manually signed facsimile thereof) and any other documents required by this
Letter of Transmittal, must be received by the Depositary at one of its
addresses set forth on the front page of this Letter of Transmittal prior to the
Expiration Date. 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 share certificates are not immediately available, who
cannot deliver their Shares and all other required documents to the Depositary
or who cannot complete the procedure for delivery by book-entry transfer prior
to the Expiration Date may tender their Shares pursuant to the guaranteed
delivery procedure set forth in Section 3 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 the Company (with any required
signature guarantees) must be received by the Depositary prior to the Expiration
Date, and (iii) the certificates for all physically delivered Shares in proper
form for transfer by delivery, or a confirmation of a book-entry transfer into
the Depositary's account at one of the Book-Entry Transfer Facilities of all
Shares delivered electronically, in each case together with a properly completed
and duly executed Letter of Transmittal (or manually signed facsimile thereof)
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 the Depositary receives such Notice of Guaranteed Delivery, all as
provided in Section 3 of the Offer to Purchase.
THE METHOD OF DELIVERY OF ALL DOCUMENTS, INCLUDING SHARE CERTIFICATES, THE
LETTER OF TRANSMITTAL AND ANY OTHER REQUIRED DOCUMENTS, IS AT THE ELECTION 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.
No alternative or contingent tenders will be accepted. By executing this
Letter of Transmittal (or facsimile thereof), the tendering shareholder waives
any right to receive any notice of the acceptance for payment of the Shares.
3. Inadequate Space. If the space provided herein is inadequate, the
certificate numbers and/or the number of Shares should be listed on a separate
signed schedule and attached to this Letter of Transmittal.
8
<PAGE> 9
4. Partial Tenders (Not Applicable to Shareholders Who Tender by Book-Entry
Transfer). If fewer than all the Shares represented by any certificate
delivered to the Depositary are to be tendered, fill in the number of Shares
that are to be tendered in the box entitled "Number of Shares Tendered." In such
case, a new certificate for the remainder of the Shares represented by the old
certificate will be sent to the person(s) signing this Letter of Transmittal,
unless otherwise provided in the "Special Payment Instructions" or "Special
Delivery Instructions" boxes on this Letter of Transmittal, as promptly as
practicable following the expiration or termination of the Offer. All Shares
represented by certificates delivered to the Depositary will be deemed to have
been tendered unless otherwise indicated.
5. Indication of Price at Which Shares Are Being Tendered. For Shares to
be validly tendered, the shareholder must check the box indicating the price per
Share at which such shareholder is tendering Shares under "Price (In Dollars)
Per Share At Which Shares Are Being Tendered" in this Letter of Transmittal,
except that Odd Lot Owners (as defined in Section 2 of the Offer to Purchase)
may check the box above in the section entitled "Odd Lots" indicating that such
shareholder is tendering all Shares at the Purchase Price determined by the
Company. ONLY ONE BOX MAY BE CHECKED. IF MORE THAN ONE BOX IS CHECKED, OR (OTHER
THAN AS DESCRIBED ABOVE FOR ODD LOT OWNERS) IF NO BOX IS CHECKED, THERE IS NO
VALID TENDER OF SHARES. A shareholder wishing to tender portions of such
shareholder's Share holdings at different prices must complete a separate Letter
of Transmittal for each price at which such shareholder wishes to tender each
such portion of such shareholder's Shares. The same Shares cannot be tendered
(unless previously validly withdrawn as provided in Section 4 of the Offer to
Purchase) at more than one price.
6. 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 signatures(s) must correspond with the name(s) as written
on the face of the certificates without alteration, enlargement or any change
whatsoever.
If any of the Shares tendered hereby are held 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 different names on
different certificates, it will be necessary to complete, sign and submit as
many separate Letters of Transmittal (or facsimiles thereof) as there are
different registrations of 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 of the Purchase Price is to be made to, or Shares
not tendered or not purchased are to be registered in the name of, any 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 certificates. Signatures on any such certificates or stock
powers must be guaranteed by an Eligible Institution. See Instruction 1.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares tendered hereby, certificates 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). Signature(s) on any such
certificates or stock powers must be guaranteed by an Eligible Institution. See
Instruction 1.
If this Letter of Transmittal or any certificate 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
the Company of the authority of such person so to act must be submitted.
9
<PAGE> 10
7. Stock Transfer Taxes. The Company will pay or cause to be paid any
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 aggregate
Purchase Price is to be made to, or Shares not tendered or not purchased are to
be registered in the name of, any person other than the registered holder(s), or
if tendered Shares are registered in the name of any person other than the
person(s) signing this Letter of Transmittal, the amount of any stock transfer
taxes (whether imposed on the registered holder(s), such other person or
otherwise) payable on account of the transfer to such person will be deducted
from the Purchase Price unless satisfactory evidence of the payment of such
taxes, or exemption therefrom, is submitted. See Section 5 of the Offer to
Purchase. Except as provided in this Instruction 7, it will not be necessary to
affix transfer tax stamps to the certificates representing Shares tendered
hereby.
8. Special Payment and Delivery Instructions. If a check for the Purchase
Price of any Shares tendered
hereby is to be issued in the name of, and/or any Shares not tendered or not
purchased are to be returned to, a person other than the person(s) signing this
Letter of Transmittal, or if the check and/or any certificates for Shares not
tendered or not purchased are to be mailed to someone other than the person(s)
signing this Letter of Transmittal or to an address other than that shown above
in the box captioned "Description of Shares Tendered," then the boxes captioned
"Special Payment Instructions" and/or "Special Delivery Instructions" on this
Letter of Transmittal should be completed. Shareholders tendering Shares by
book-entry transfer will have any Shares not accepted for payment returned by
crediting the account maintained by such shareholder at the Book-Entry Transfer
Facility from which such transfer was made.
9. Odd Lots. As described in Section 1 of the Offer to Purchase, if fewer
than all Shares validly tendered at or below the Purchase Price and not
withdrawn prior to the Expiration Date are to be purchased, the Shares purchased
first will consist of all Shares tendered by any shareholder who owned
beneficially, as of the close of business on October 23, 1996, and continues to
own beneficially as of the Expiration Date, an aggregate of fewer than 100
Shares (including Shares reflecting interests in the Company Stock Fund
allocated to the Savings Plan but excluding Restricted Shares) and who validly
tendered all such Shares at or below the Purchase Price (including by not
designating a Purchase Price as described below). Partial tenders of Shares will
not qualify for this preference and this preference will not be available unless
the box captioned "Odd Lots" in this Letter of Transmittal and the Notice of
Guaranteed Delivery, if any, is completed.
Additionally, tendering holders of Odd Lots who do not wish to specify a
purchase price may check the box above in the section entitled "Odd Lots"
indicating that such shareholder is tendering all Shares at the Purchase Price
determined by the Company. See Instruction 5.
10. Substitute Form W-9 and Form W-8. Under the United States federal
income tax backup withholding rules, unless an exemption applies under the
applicable law and regulations, 31% of the gross proceeds payable to a
shareholder or other payee pursuant to the Offer must be withheld and remitted
to the United States Treasury, unless the shareholder or other payee provides
such person's taxpayer identification number (employer identification number or
social security number) to the Depositary and certifies that such number is
correct. Therefore, each tendering shareholder should complete and sign the
Substitute Form W-9 included as part of the Letter of Transmittal so as to
provide the information and certification necessary to avoid backup withholding,
unless such shareholder otherwise establishes to the satisfaction of the
Depositary that it is not subject to backup withholding. Certain shareholders
(including, among others, all corporations and certain foreign shareholders (in
addition to foreign corporations)) are not subject to these backup withholding
and reporting requirements. In order for a foreign shareholder to qualify as an
exempt recipient, that shareholder must submit an IRS Form W-8 or a Substitute
Form W-8, signed under penalties of perjury, attesting to that shareholder's
exempt status. Such statements may be obtained from the Depositary.
10
<PAGE> 11
11. Withholding On Foreign Shareholders. Even if a foreign shareholder has
provided the required certification to avoid backup withholding, the Depositary
will withhold United States federal income taxes equal to 30% of the gross
payments payable to a foreign shareholder or his or her agent unless the
Depositary determines that an exemption from or a reduced rate of withholding is
available pursuant to a tax treaty or that an exemption from withholding is
applicable because such gross proceeds are effectively connected with the
conduct of a trade or business in the United States. For this purpose, a foreign
shareholder is a shareholder that is not (i) a citizen or resident of the United
States, (ii) a corporation, partnership or other entity created or organized in
or under the laws of the United States, any state or any political subdivision
thereof or (iii) any estate or trust the income of which is subject to United
States federal income taxation regardless of the source of such income. In order
to obtain a reduced rate of withholding pursuant to a tax treaty, a foreign
shareholder must deliver to the Depositary a properly completed IRS Form 1001.
In order to obtain an exemption from withholding on the grounds that the gross
proceeds paid pursuant to the Offer are effectively connected with the conduct
of a trade or business within the United States, a foreign shareholder must
deliver to the Depositary a properly completed IRS Form 4224. The Depositary
will determine a shareholder's status as a foreign shareholder and eligibility
for a reduced rate of, or an exemption from, withholding by reference to
outstanding certificates or statements concerning eligibility for a reduced rate
of, or exemption from, withholding (e.g., IRS Form 1001 or IRS Form 4224) unless
facts and circumstances indicate that such reliance is not warranted. A foreign
shareholder may be eligible to obtain a refund of all or a portion of any tax
withheld if such shareholder meets the "complete redemption," "substantially
disproportionate" or "not essentially equivalent to a dividend" test described
in Section 14 of the Offer to Purchase or is otherwise able to establish that no
tax or a reduced amount of tax is due. Backup withholding generally will not
apply to amounts subject to the 30% or treaty-reduced rate of withholding.
Foreign shareholders are urged to consult their tax advisors regarding the
application of United States federal income tax withholding, including
eligibility for a withholding tax reduction or exemption and refund procedures.
12. Requests for Assistance or Additional Copies. Any questions or
requests for assistance may be directed to the Information Agent or the Dealer
Manager at their respective telephone numbers and addresses listed below.
Requests for additional copies of the Offer to Purchase, this Letter of
Transmittal or other tender offer materials may be directed to the Information
Agent or the Dealer Manager, and such copies will be furnished promptly at the
Company's expense. Shareholders may also contact their local broker, dealer,
commercial bank or trust company for documents relating to, or assistance
concerning, the Offer.
13. Irregularities. All questions as to the number of Shares to be
accepted, the price to be paid therefor and the validity, form, eligibility
(including time of receipt) and acceptance for payment of any tender of Shares
will be determined by the Company, in its sole discretion, which determination
shall be final and binding on all parties. The Company reserves the absolute
right to reject any or all tenders it determines not to be in proper form or the
acceptance of or payment for which may, in the opinion of the Company's counsel
be unlawful. The Company also reserves the absolute right to waive any of the
conditions of the Offer and any defect or irregularity in the tender of any
particular Shares or any particular shareholder. No tender of Shares will be
deemed to be validly made until all defects or irregularities have been cured or
waived. None of the Company, the Dealer Manager, the Depositary, the Information
Agent or any other person is or will be obligated to give notice of any defects
or irregularities in tenders, and none of them will incur any liability for
failure to give any such notice.
14. Savings Plan; Restricted Shares. Participants in the Company's Savings
Plan may not use this Letter of Transmittal to direct the tender of Shares
reflecting interests in the Company Stock Fund credited to such participant's
individual account, but must use the separate Direction Form sent to them by the
Company. Restricted Shares (as defined in the Offer to Purchase) may not be
tendered pursuant to the Offer until the applicable restriction period has
expired. See Section 3 of the Offer to Purchase.
15. Order of Purchase in Event of Proration. As described in Section 1 of
the Offer to Purchase, shareholders may designate the order in which their
Shares are to be purchased in the event of proration. The order of purchase may
affect whether any capital gain or loss recognized on the Shares purchased is
long-term or short-term (depending on the holding period for the Shares
purchased) and the amount of gain or loss recognized for federal income tax
purposes. See Sections 1 and 14 of the Offer to Purchase.
11
<PAGE> 12
16. Lost, Stolen or Destroyed Certificates. If your certificate(s)
representing Shares have been lost, stolen or destroyed, so indicate on the
front of this Letter of Transmittal. The Depositary will send you additional
documentation that will need to be completed to effectively surrender such lost,
stolen or destroyed certificates.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A MANUALLY SIGNED FACSIMILE
THEREOF) TOGETHER WITH SHARE CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER
AND ALL OTHER REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY, OR THE
NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE DEPOSITARY, PRIOR TO THE
EXPIRATION DATE. SHAREHOLDERS ARE ENCOURAGED TO RETURN A COMPLETED SUBSTITUTE
FORM W-9 WITH THEIR LETTER OF TRANSMITTAL.
12
<PAGE> 13
<TABLE>
<C> <S> <C>
- --------------------------------------------------------------------------------------------------------
PAYOR'S NAME: CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
SUBSTITUTE PART 1 -- Please provide your TIN in the --------------------------------------
FORM W-9 box at right and certify by signing and Social Security Number
dating below. or
Employer Identification Number
------------------------------------------------------------------------------------
DEPARTMENT OF THE PART 2 -- For Payees exempt from backup withholding, see the enclosed Guidelines
TREASURY for Certification of Taxpayer Identification Number on Substitute Form W-9 and
INTERNAL REVENUE complete as instructed therein.
SERVICE
------------------------------------------------------------------------------------
PART 3 -- Awaiting TIN / /
------------------------------------------------------------------------------------
Certification -- Under penalties of perjury, I certify that (i) the number shown on
this form is my correct Taxpayer Identification Number (or I am waiting for a
number to be issued to me) and either (a) I have mailed or delivered an application
to receive a taxpayer identification number to the appropriate IRS center or Social
Security Administration office or (b) I intend to mail or deliver an application in
the near future) and (ii) I am not subject to backup withholding because: (a) I am
exempt from backup withholding; or (b) I have not been notified by the IRS that I
am subject to backup withholding as a result of a failure to report all interest or
dividends; or (c) the IRS has notified me that I am no longer subject to backup
withholding. Certification instructions -- You must cross out Item (ii) above if
you have been notified by the IRS that you are currently subject to backup
withholding because of underreporting interest or dividends on your tax return.
Signature Date ________________
Name
(Please Print)
Address
(Include Zip Code)
PAYOR'S REQUEST FOR
TAXPAYER
IDENTIFICATION
NUMBER ("TIN")
- --------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THIS OFFER.
PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU ARE AWAITING YOUR TIN.
- --------------------------------------------------------------------------------
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a TIN has not been issued to
me, and either (1) I have mailed or delivered an application to receive a
TIN to the appropriate IRS Center or Social Security Administration Office
or (2) I intend to mail or deliver an application in the near future. I
understand that if I do not provide a TIN by the time of payment, 31% of
all payments made to me thereafter will be withheld until I provide a
number.
Signature Date _______________
13
<PAGE> 14
The Information Agent for the Offer is:
(LOGO)vwx
Wall Street Plaza
New York, New York 10005
(800) 223-2064 (Toll Free)
Banks and Brokers call collect:
(212) 440-9800
The Dealer Manager for the Offer is:
J.P. MORGAN SECURITIES INC.
60 Wall Street
New York, New York 10260-0060
(212) 648-7833
(800) 576-9843 (Toll Free)
<PAGE> 1
HANDY & HARMAN
NOTICE OF GUARANTEED DELIVERY
OF SHARES OF COMMON STOCK
This form, or a form substantially equivalent to this form, must be used to
accept the Offer (as defined below) if certificates for the shares of common
stock of Handy & Harman are not immediately available, if the procedure for
book-entry transfer cannot be completed on a timely basis, or if time will not
permit all other documents required by the Letter of Transmittal to be delivered
to the Depositary prior to the Expiration Date (as defined in Section 1 of the
Offer to Purchase (defined below)). Such form may be delivered by hand or
transmitted by mail or overnight courier, or (for Eligible Institutions only) by
facsimile transmission, to the Depositary. See Section 3 of the Offer to
Purchase. 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 TO THE DEPOSITARY WITHIN THE TIME SHOWN HEREIN. FAILURE
TO DO SO COULD RESULT IN A FINANCIAL LOSS TO SUCH ELIGIBLE INSTITUTION.
The Depositary for the Offer is:
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
<TABLE>
<S> <C> <C>
By Mail: By Facsimile Transmission: By Hand or By Overnight Courier:
Reorganization Department (201) 329-8936 Reorganization Department
Midtown Station 120 Broadway - 13th Floor
P.O.Box 798 New York, NY 10271
New York, NY 10018
</TABLE>
Confirm Receipt of Notice of Guaranteed Delivery:
(201) 296-4983
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR
TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE NUMBER OTHER THAN THE ONE LISTED
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.
<PAGE> 2
Ladies and Gentlemen:
The undersigned hereby tenders to Handy & Harman, a New York corporation
(the "Company"), upon the terms and subject to the conditions set forth in the
Offer to Purchase, dated October 24, 1996 (the "Offer to Purchase"), and the
related Letter of Transmittal (which, as amended from time to time, together
constitute the "Offer"), receipt of which is hereby acknowledged, the number of
shares of common stock, par value $1.00 per share (including the associated
common stock purchase rights) (the "Shares"), of the Company listed below,
pursuant to the guaranteed delivery procedure set forth in Section 3 of the
Offer to Purchase. The undersigned understands that a tender of Shares pursuant
to the Offer will include a tender of the associated common stock purchase
rights (the "Rights") and that no separate consideration will be paid for such
Rights. For a description of the Rights, see Section 7 of the Offer to Purchase.
Number of Shares:
- ------------------------------------------------------------
------------------------------------------------------------
Name(s) (Please Print)
Certificate Nos.: (if available)
- ------------------------------------------------------------
------------------------------------------------------------
- ------------------------------------------------------------
------------------------------------------------------------
(Address)
If shares will be tendered by book-entry transfer:
Name of Tendering Institution:
- ------------------------------------------------------------
------------------------------------------------------------
Area Code and Telephone Number
Account No.
- ------------ at (check one)
/ / The Depository Trust Company
/ / Philadelphia Depository Trust Company
------------------------------------------------------------
Signature(s)
2
<PAGE> 3
PRICE (IN DOLLARS) PER SHARE
AT WHICH SHARES ARE BEING TENDERED
- --------------------------------------------------------------------------------
IF SHARES ARE BEING TENDERED AT MORE THAN ONE PRICE,
A SEPARATE NOTICE OF GUARANTEED DELIVERY FOR EACH PRICE
SPECIFIED MUST BE USED.
- --------------------------------------------------------------------------------
CHECK ONLY ONE BOX. IF MORE THAN ONE BOX IS CHECKED, OR
IF NO BOX IS CHECKED (EXCEPT AS PROVIDED IN THE ODD
LOTS BOX AND INSTRUCTIONS BELOW), THERE IS NO VALID
TENDER OF SHARES.
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C> <C>
/ / $17.50 / / $18.00 / / $18.50 / / $19.00 / / $19.50 / / $20.00
/ / $17.75 / / $18.25 / / $18.75 / / $19.25 / / $19.75
</TABLE>
ODD LOTS
This section is to be completed ONLY if Shares are being tendered by or on
behalf of a person who owned beneficially, as of the close of business on
October 23, 1996, and who continues to own beneficially as of the Expiration
Date, an aggregate of fewer than 100 Shares (excluding Restricted Shares (as
defined in the Offer to Purchase) but including Shares reflecting interests in
the Company Stock Fund (as defined in the Offer to Purchase) allocated to the
Savings Plan (as defined in the Offer to Purchase)).
The undersigned either (check one box):
/ / owned beneficially, as of the close of business on October 23, 1996 and
continues to own beneficially as of the Expiration Date, an aggregate
of fewer than 100 Shares (excluding Restricted Shares but including
Shares reflecting interests in the Company Stock Fund allocated to the
Savings Plan), all of which are being tendered, or
/ / is a broker, dealer, commercial bank, trust company or other nominee
that (i) is tendering, for the beneficial owners thereof, Shares with
respect to which it is the record owner, and (ii) believes, based upon
representations made to it by each such beneficial owner, that such
beneficial owner owned beneficially, as of the close of business on
October 23, 1996, and continues to own beneficially as of the
Expiration Date, an aggregate of fewer than 100 Shares (excluding
Restricted Shares but including Shares reflecting interests in the
Company Stock Fund allocated to the Savings Plan) and is tendering all
of such Shares.
If you do not wish to specify a purchase price, check the following box, in
which case you will be deemed to have tendered at the Purchase Price determined
by the Company in accordance with the terms of the Offer (persons checking this
box need not indicate the price per Share in the box entitled "Price (In
Dollars) Per Share At Which Shares Are Being Tendered" above. / /
3
<PAGE> 4
GUARANTEE (NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a firm or other entity that is a member in good standing
of the Security Transfer Agent's Medallion Program, the New York Stock Exchange
Medallion Program or the Stock Exchange Medallion Program (an "Eligible
Institution"), hereby guarantees (i) that the above-named person(s) has a net
long position in the Shares being tendered within the meaning of Rule 14e-4
promulgated under the Securities Exchange Act of 1934, as amended, (ii) that
such tender of Shares complies with Rule 14e-4, and (iii) to deliver to the
Depositary at one of its addresses set forth above certificate(s) for the Shares
tendered hereby, in proper form for transfer, or a confirmation of the
book-entry transfer of the Shares tendered hereby into the Depositary's account
at The Depository Trust Company or the Philadelphia Depository Trust Company, in
each case together with a properly completed and duly executed Letter(s) of
Transmittal (or manually signed facsimile(s) thereof), with any required
signature guarantee(s) and any other required documents, all within three New
York Stock Exchange, Inc. trading days after the date hereof.
<TABLE>
<S> <C>
- ------------------------------------------------ ------------------------------------------------
Name of Firm Authorized Signature
- ------------------------------------------------ ------------------------------------------------
Address Name
- ------------------------------------------------ ------------------------------------------------
City, State, Zip Code Title
- ------------------------------------------------
Area Code and Telephone Number
</TABLE>
Dated:
- -------------, 1996
DO NOT SEND SHARE CERTIFICATES WITH THIS FORM.
YOUR SHARE CERTIFICATES MUST BE SENT WITH
THE LETTER OF TRANSMITTAL.
4
<PAGE> 1
J.P. Morgan Securities Inc.
60 Wall Street
New York, New York 10260
HANDY & HARMAN
OFFER TO PURCHASE FOR CASH
UP TO 1,800,000 SHARES OF ITS COMMON STOCK
(INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS)
AT A PURCHASE PRICE NOT GREATER THAN $20.00
NOR LESS THAN $17.50 PER SHARE
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON THURSDAY, NOVEMBER 21, 1996, UNLESS THE OFFER IS
EXTENDED.
October 24, 1996
To Brokers, Dealers, Commercial
Banks, Trust Companies and
Other Nominees:
In our capacity as Dealer Manager, we are enclosing the material listed
below relating to the offer of Handy & Harman, a New York corporation (the
"Company"), to purchase up to 1,800,000 shares of its common stock, par value
$1.00 per share, (including the associated common stock purchase rights) (the
"Shares"), at prices not greater than $20.00 nor less than $17.50 per Share, net
to the seller in cash, specified by tendering shareholders, upon the terms and
subject to the conditions set forth in the Offer to Purchase, dated October 24,
1996 (the "Offer to Purchase"), and in the related Letter of Transmittal (which,
as amended from time to time, together constitute the "Offer").
The Company will determine a single price (not greater than $20.00 nor less
than $17.50 per Share), net to the seller in cash, that it will pay for Shares
validly tendered and not withdrawn pursuant to the Offer (the "Purchase Price"),
taking into account the number of Shares so tendered and the prices specified by
tendering shareholders. The Company will select the lowest Purchase Price that
will allow it to purchase 1,800,000 Shares (or such lesser number of Shares as
is validly tendered at prices not greater than $20.00 nor less than $17.50 per
Share) and not withdrawn pursuant to the Offer. The Company will purchase all
Shares validly tendered at prices at or below the Purchase Price and not
withdrawn, upon the terms and subject to the conditions of the Offer, including
the provisions relating to proration described in the Offer to Purchase. See
Section 1 of the Offer to Purchase.
The Purchase Price will be paid in cash, net to the seller, with respect to
all Shares purchased. Shares tendered at prices in excess of the Purchase Price
and Shares not purchased because of proration will be returned.
A tender of Shares pursuant to the Offer will include a tender of the
associated common stock purchase rights (the "Rights"). No separate
consideration will be paid for such Rights. For a description of the Rights, see
Section 7 of the Offer to Purchase.
THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS. SEE
SECTION 6 OF THE OFFER TO PURCHASE.
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
<PAGE> 2
attention as promptly as possible. The Company will, upon request, reimburse you
for reasonable and customary handling and mailing expenses incurred by you in
forwarding any of the enclosed materials to your clients.
For your information and for forwarding to your clients, we are enclosing
the following documents:
1. The Offer to Purchase.
2. The Letter of Transmittal for your use and for the information of
your clients.
3. A letter to shareholders of the Company from the Chairman and Chief
Executive Officer of the Company.
4. The Notice of Guaranteed Delivery to be used to accept the Offer if
the Shares and all other required documents cannot be delivered to the
Depositary by the Expiration Date (each as defined in the Offer to
Purchase).
5. A letter that may be sent to your clients for whose accounts you
hold Shares registered in your name or in the name of your nominee, with
space for obtaining such clients' instructions with regard to the Offer.
6. Guidelines of the Internal Revenue Service for Certification of
Taxpayer Identification Number on Substitute Form W-9 providing information
relating to backup federal income tax withholding.
7. A return envelope addressed to ChaseMellon Shareholder Services,
L.L.C., the Depositary.
WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. PLEASE NOTE
THAT THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON THURSDAY, NOVEMBER 21, 1996, UNLESS THE OFFER IS
EXTENDED.
The Company will not pay any fees or commissions to any broker, dealer or
other person for soliciting tenders of Shares pursuant to the Offer (other than
the Dealer Manager). The Company will, upon request, reimburse brokers, dealers,
commercial banks and trust companies for reasonable and customary handling and
mailing expenses incurred by them in forwarding materials relating to the Offer
to their customers. The Company will pay all stock transfer taxes applicable to
its purchase of Shares pursuant to the Offer, subject to Instruction 7 of the
Letter of Transmittal.
As described in the Offer to Purchase, if more than 1,800,000 Shares have
been validly tendered at or below the Purchase Price and not withdrawn prior to
the Expiration Date, as defined in Section 1 of the Offer to Purchase, the
Company will accept Shares for purchase in the following order of priority: (i)
all Shares validly tendered at or below the Purchase Price and not withdrawn
prior to the Expiration Date by any shareholder who owned beneficially, as of
the close of business on October 23, 1996, and who continues to own beneficially
as of the Expiration Date, an aggregate of fewer than 100 Shares (excluding
Restricted Shares (as defined in the Offer to Purchase) but including Shares
reflecting interests in the Company Stock Fund (as defined in the Offer to
Purchase) allocated to the Savings Plan (as defined in the Offer to Purchase))
and who validly tenders all of such Shares (partial tenders will not qualify for
this preference) and completes the box captioned "Odd Lots" in the Letter of
Transmittal and, if applicable, the Notice of Guaranteed Delivery; and (ii)
after purchase of all of the foregoing Shares, all other Shares validly tendered
at or below the Purchase Price and not withdrawn prior to the Expiration Date on
a pro rata basis.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE MAKING
OF THE OFFER. HOWEVER, SHAREHOLDERS MUST MAKE THEIR OWN DECISIONS WHETHER TO
TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND THE PRICE OR PRICES AT
WHICH SHARES SHOULD BE TENDERED. NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS
MAKES ANY RECOMMENDATION TO ANY SHAREHOLDER AS TO WHETHER TO TENDER OR REFRAIN
FROM TENDERING SHARES. THE COMPANY HAS BEEN ADVISED THAT NONE OF ITS DIRECTORS
OR EXECUTIVE OFFICERS INTENDS TO TENDER ANY SHARES PURSUANT TO THE OFFER.
2
<PAGE> 3
Any questions or requests for assistance or additional copies of the
enclosed materials may be directed to the Information Agent or the Dealer
Manager at their respective addresses and telephone numbers set forth on the
back cover of the enclosed Offer to Purchase.
Very truly yours,
J.P. MORGAN SECURITIES INC.
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
OR ANY OTHER PERSON THE AGENT OF THE COMPANY, THE DEALER MANAGER, THE
INFORMATION AGENT OR THE DEPOSITARY, 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 HEREWITH AND THE STATEMENTS
CONTAINED THEREIN.
3
<PAGE> 1
HANDY & HARMAN
OFFER TO PURCHASE FOR CASH
UP TO 1,800,000 SHARES OF ITS COMMON STOCK
(INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS)
AT A PURCHASE PRICE NOT GREATER THAN $20.00
NOR LESS THAN $17.50 PER SHARE
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT
12:00 MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY, NOVEMBER 21, 1996,
UNLESS THE OFFER IS EXTENDED
To Our Clients:
Enclosed for your consideration are the Offer to Purchase, dated October
24, 1996 (the "Offer to Purchase"), and the related Letter of Transmittal
(which, as amended from time to time, together constitute the "Offer") setting
forth an offer by Handy & Harman, a New York corporation (the "Company"), to
purchase up to 1,800,000 shares of its common stock, par value $1.00 per share
(including the associated common stock purchase rights) (the "Shares"), at
prices not greater than $20.00 nor less than $17.50 per Share, net to the seller
in cash, specified by tendering shareholders, upon the terms and subject to the
conditions of the Offer. Also enclosed herewith is certain other material
related to the Offer, including a letter to shareholders from Richard N. Daniel,
Chairman and Chief Executive Officer of the Company.
The Company will determine a single per Share price (not greater than
$20.00 nor less than $17.50 per Share) that it will pay for the Shares validly
tendered pursuant to the Offer and not withdrawn (the "Purchase Price"), taking
into account the number of Shares so tendered and the prices specified by
tendering shareholders. The Company will select the lowest Purchase Price that
will allow it to purchase 1,800,000 Shares (or such lesser number of Shares as
are validly tendered at prices not greater than $20.00 nor less than $17.50 per
Share) validly tendered and not withdrawn pursuant to the Offer. The Company
will purchase all Shares validly tendered at prices at or below the Purchase
Price and not withdrawn, upon the terms and subject to the conditions of the
Offer, including the provisions thereof relating to proration. See Section 1 of
the Offer to Purchase.
A tender of Shares pursuant to the Offer will include a tender of the
associated common stock purchase rights (the "Rights"). No separate
consideration will be paid for such Rights. For a description of the Rights, see
Section 7 of the Offer to Purchase.
WE ARE THE HOLDER OF RECORD OF SHARES HELD FOR YOUR ACCOUNT. AS SUCH, 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 us to tender 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 to Purchase and the Letter of Transmittal.
Your attention is invited to the following:
1. You may tender Shares at prices (in multiples of $.25), not greater
than $20.00 nor less than $17.50 per Share, as indicated in the attached
Instruction Form, net to you in cash.
<PAGE> 2
2. The Offer is for up to 1,800,000 Shares, constituting approximately
13% of the total Shares outstanding as of October 16, 1996. The Offer is
not conditioned on any minimum number of Shares being tendered. The Offer
is, however, subject to certain other conditions set forth in the Offer to
Purchase.
3. The Offer, proration period and withdrawal rights will expire at
12:00 Midnight, New York City time, on Thursday, November 21, 1996, unless
the Offer is extended. Your instructions to us should be forwarded to us in
ample time to permit us to submit a tender on your behalf.
4. As described in the Offer to Purchase, if more than 1,800,000
Shares have been validly tendered at or below the Purchase Price and not
withdrawn prior to the Expiration Date, as defined in Section 1 of the
Offer to Purchase, the Company will purchase Shares in the following order
of priority:
(i) all Shares validly tendered at or below the Purchase Price and
not withdrawn prior to the Expiration Date by any shareholder who owned
beneficially, as of the close of business on October 23, 1996, and who
continues to own beneficially as of the Expiration Date, an aggregate of
fewer than 100 Shares (including Shares reflecting interests in the
Company Stock Fund (as defined in the Offer to Purchase) allocated to
the Savings Plan (as defined in the Offer to Purchase) but excluding
Restricted Shares (as defined in the Offer to Purchase)) who validly
tenders all of such Shares (partial tenders will not qualify for this
preference) and completes the box captioned "Odd Lots" in the Letter of
Transmittal and, if applicable, the Notice of Guaranteed Delivery; and
(ii) after purchase of all the foregoing Shares, all other Shares
validly tendered at or below the Purchase Price and not withdrawn prior
to the Expiration Date on a pro rata basis. See Section 1 of the Offer
to Purchase for a discussion of proration.
5. Tendering shareholders will not be obligated to pay any brokerage
commissions or solicitation fees on the Company's purchase of Shares in the
Offer. Any stock transfer taxes applicable to the purchase of Shares by the
Company pursuant to the Offer will be paid by the Company, except as
otherwise provided in Instruction 7 of the Letter of Transmittal.
6. If you wish to tender portions of your Shares at different prices
you must complete a separate Instruction Form for each price at which you
wish to tender each portion of your Shares. We must submit separate Letters
of Transmittal on your behalf for each price you will accept.
7. If you owned beneficially, as of the close of business on October
23, 1996, and continue to own beneficially as of the Expiration Date, an
aggregate of fewer than 100 Shares (including Shares reflecting interests
in the Company Stock Fund allocated to the Savings Plan but excluding
Restricted Shares), and you instruct us to tender at or below the Purchase
Price on your behalf all such Shares prior to the Expiration Date and check
the box captioned "Odd Lots" in the Instruction Form, all such Shares will
be accepted for purchase before proration, if any, of the purchase of other
tendered Shares.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE MAKING
OF THE OFFER. HOWEVER, SHAREHOLDERS MUST MAKE THEIR OWN DECISIONS WHETHER TO
TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND THE PRICE OR PRICES AT
WHICH SHARES SHOULD BE TENDERED. NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS
MAKES ANY RECOMMENDATION TO ANY SHAREHOLDER AS TO WHETHER TO TENDER OR REFRAIN
FROM TENDERING SHARES. THE COMPANY HAS BEEN ADVISED THAT NONE OF ITS DIRECTORS
OR EXECUTIVE OFFICERS INTENDS TO TENDER ANY SHARES PURSUANT TO THE OFFER.
If you wish to have us tender any or all of your Shares held by us for your
account upon the terms and subject to the conditions set forth in the Offer to
Purchase, please so instruct us by completing, executing and returning to us the
attached Instruction Form. An envelope to return your instructions to us is
enclosed. If you authorize tender of your Shares, all such Shares will be
tendered unless otherwise specified on the Instruction Form. 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> 3
The Offer is being made to all holders of Shares. The Company is not aware
of any jurisdiction where the making of the Offer is not in compliance with
applicable law. If the Company becomes aware of any jurisdiction where the
making of the Offer is not in compliance with any valid applicable law, the
Company will make a good faith effort to comply with such law. If, after such
good faith effort, the Company cannot comply with such law, the Offer will not
be made to (nor will tenders be accepted from or on behalf of) the holders of
Shares residing in such jurisdiction. In any jurisdiction the securities or blue
sky laws of which require the Offer to be made by a licensed broker or dealer,
the Offer is being made on the Company's behalf by the Dealer Manager or one or
more registered brokers or dealers licensed under the laws of such jurisdiction.
3
<PAGE> 4
INSTRUCTION FORM
WITH RESPECT TO OFFER TO PURCHASE FOR CASH
UP TO 1,800,000 SHARES OF COMMON STOCK
OF
HANDY & HARMAN
AT A PURCHASE PRICE NOT GREATER THAN $20.00
NOR LESS THAN $17.50 PER SHARE
The undersigned acknowledge(s) receipt of your letter and the enclosed
Offer to Purchase, dated October 24, 1996, and the related Letter of Transmittal
(which, as amended from time to time, together constitute the "Offer") in
connection with the Offer by Handy & Harman (the "Company") to purchase up to
1,800,000 shares of its common stock, par value $1.00 per share (the "Shares"),
at prices not greater than $20.00 nor less than $17.50 per Share, net to the
undersigned in cash, specified by the undersigned, upon the terms and subject to
the terms and conditions of the Offer.
The undersigned further acknowledge(s) that a tender of Shares pursuant to
the Offer will include a tender of the associated common stock purchase rights
(the "Rights"), and that no separate consideration will be paid for such Rights.
For a description of the Rights, see Section 7 of the Offer to Purchase.
This will instruct you to tender to the Company the number of Shares
indicated below (or, if no number is indicated below, all Shares) that are held
by you for the account of the undersigned, at the price per Share indicated
below, upon the terms and subject to the conditions of the Offer.
SHARES TENDERED
/ / By checking this box, all Shares held by us for your account will be
tendered. If fewer than all Shares are to be tendered, please check the
box and indicate below the aggregate number of Shares to be tendered by
us.
--------------------------- Shares
Unless otherwise indicated, it will be assumed that all Shares held by us
for your account are to be tendered.
<PAGE> 5
PRICE (IN DOLLARS) PER SHARE
AT WHICH SHARES ARE BEING TENDERED
IF SHARES ARE BEING TENDERED AT MORE THAN ONE PRICE,
A SEPARATE INSTRUCTION FORM FOR EACH PRICE SPECIFIED MUST BE USED.
CHECK ONLY ONE BOX. IF MORE THAN ONE BOX IS CHECKED, OR
IF NO BOX IS CHECKED (EXCEPT AS PROVIDED IN THE ODD LOTS BOX AND
INSTRUCTIONS BELOW), THERE IS NO VALID TENDER OF SHARES.
<TABLE>
<S> <C> <C> <C> <C> <C>
/ /$17.50 / /$18.00 / /$18.50 / /$19.00 / /$19.50 / /$20.00
/ /$17.75 / /$18.25 / /$18.75 / /$19.25 / /$19.75
</TABLE>
ODD LOTS
/ / By checking this box, the undersigned represent(s) that the undersigned
owned beneficially, as of the close of business on October 23, 1996, and
continue(s) to own beneficially as of the Expiration Date, an aggregate of
fewer than 100 Shares (excluding Restricted Shares but including Shares
reflecting interests in the Company Stock Fund allocated to the Savings
Plan) and is tendering all of such Shares.
If you do not wish to specify a purchase price, check the following box, in
which case you will be deemed to have tendered at the Purchase Price determined
by the Company in accordance with the terms of the Offer (persons checking this
box need not indicate the price per Share in the box entitled "Price (In
Dollars) Per Share At Which Shares Are Being Tendered"). / /
THE METHOD OF DELIVERY OF THIS DOCUMENT IS AT THE ELECTION AND RISK OF THE
TENDERING SHAREHOLDERS. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN
RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT
TIME SHOULD BE ALLOWED TO ASSURE DELIVERY.
<TABLE>
<S> <C>
SIGN HERE
-----------------------------------------------------------
Signature(s)
Dated: , 1996 Name
Address
-----------------------------------------------------------
-----------------------------------------------------------
-----------------------------------------------------------
Social Security or Taxpayer ID No.
</TABLE>
<PAGE> 1
HANDY & HARMAN LOGO
RICHARD N. DANIEL
CHAIRMAN AND
CHIEF EXECUTIVE OFFICER
October 24, 1996
Dear Shareholder:
Handy & Harman (the "Company") is offering to purchase up to 1,800,000
shares of its common stock at a price not greater than $20.00 nor less than
$17.50 per share. The Company is conducting the Offer through a procedure
commonly referred to as a "modified Dutch auction." This procedure allows you to
select the price within the specified price range at which you are willing to
sell all or a portion of your shares to the Company.
The Offer is explained in detail in the enclosed Offer to Purchase and
Letter of Transmittal. If you wish to tender your shares, instructions on how to
tender shares are provided in the enclosed materials. I encourage you to read
these materials carefully before making any decision with respect to the Offer.
Neither the Company nor its Board of Directors makes any recommendation to any
shareholder whether or not to tender any or all shares.
Please note that the Offer is scheduled to expire at 12:00 Midnight, New
York City time, on Thursday, November 21, 1996, unless extended by the Company.
Questions regarding the Offer should not be directed to the Company but should
instead be directed to Georgeson & Company Inc., the Information Agent, at
1(800)223-2064.
Sincerely,
Richard N. Daniel
Chairman and
Chief Executive Officer
<PAGE> 1
HANDY & HARMAN LOGO
IMMEDIATE ATTENTION REQUIRED
October 24, 1996
Re: Handy & Harman Savings Plan
Dear Participant in the Handy & Harman Savings Plan:
Handy & Harman (the "Company") announced on Tuesday, October 22, that the
Company's Board of Directors has approved a plan to repurchase up to 1,800,000
shares of its common stock.
In this repurchase plan, called a modified Dutch auction tender offer,
shareholders have an opportunity to sell their shares at prices within a range
of not greater than $20.00 nor less than $17.50 per share. After shares are
tendered by shareholders, the Company selects a price and buys back shares that
have been tendered at or below such price which will be within that range.
Enclosed are tender offer materials and a Direction Form that require your
immediate attention. These materials contain important information about the
tender offer and should be carefully reviewed.
Our records reflect that a portion of your individual account in the Handy
& Harman 401(k) savings plan (the "Savings Plan") is invested in the Handy &
Harman Stock Fund. As described below, you have the right to instruct the Handy
& Harman Savings Plan Administration Committee (the "Plan Administration
Committee") and T. Rowe Price Trust Company ("T. Rowe Price"), as Trustee of the
Savings Plan, concerning whether and on what terms to tender shares attributable
to your individual account under the Savings Plan.
YOU WILL NEED TO COMPLETE THE ENCLOSED DIRECTION FORM AND RETURN IT IN THE
ENCLOSED RETURN ENVELOPE SO THAT IT IS RECEIVED BY 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON MONDAY, NOVEMBER 18, 1996, UNLESS EXTENDED. PLEASE COMPLETE AND RETURN
THE DIRECTION FORM EVEN IF YOU DECIDE NOT TO PARTICIPATE IN THE TENDER OFFER
DESCRIBED BELOW.
The remainder of this letter summarizes the transaction, your rights under
the Savings Plan and the procedures for completing the Direction Form. You
should also review the more detailed explanation provided in the other materials
including the Offer to Purchase and the related Letter of Transmittal enclosed
with this letter. For purposes of this letter, unless otherwise provided, the
term "participant" means an actual participant in the Savings Plan, the
beneficiary of a deceased actual participant and an alternative payee with
respect to an actual participant (i.e., a spouse, former spouse, child or other
dependent of an actual participant who has an interest in a Savings Plan
individual account pursuant to a qualified domestic relations order).
<PAGE> 2
BACKGROUND
The Company has made a tender offer to purchase up to 1,800,000 shares of
its common stock, par value $1.00 per share (including the associated common
stock purchase rights) (the "Shares"), at prices not greater than $20.00 nor
less than $17.50 per Share. The enclosed Offer to Purchase, dated October 24,
1996 ("Offer to Purchase"), and the related Letter of Transmittal (which, as
amended from time to time, together constitute the "Offer") set forth the
objectives, terms and conditions of the Offer and are being provided to all of
the Company's shareholders.
A tender of Shares pursuant to the Offer will include a tender of the
associated common stock purchase rights (the "Rights"). No separate
consideration will be paid for such Rights. For a description of the Rights, see
Section 7 of the Offer to Purchase.
The Offer extends to the approximately 183,539 Shares currently held by the
Savings Plan. Only T. Rowe Price as Trustee of the Savings Plan can tender these
Shares for sale. Nonetheless, as a Savings Plan participant, you have the right
to direct the Plan Administration Committee and T. Rowe Price whether or not to
tender some or all of the Shares attributable to your individual account in the
Savings Plan. If you direct the Plan Administration Committee and T. Rowe Price
to tender any of the Shares attributable to your individual account, you must
also specify the price or prices at which the Shares should be tendered.
Please note that T. Rowe Price is the holder of record of Shares
attributable to your individual account under the Savings Plan. A tender of such
Shares can be made only by T. Rowe Price as the holder of record. The Letter of
Transmittal is furnished to you for your information only and cannot be used by
you to tender Shares attributable to your individual account under the Savings
Plan.
NONE OF THE COMPANY, ITS BOARD OF DIRECTORS, THE PLAN ADMINISTRATION
COMMITTEE, T. ROWE PRICE, ITS AFFILIATES, OR ANY OTHER PARTY MAKES ANY
RECOMMENDATIONS AS TO WHETHER TO DIRECT THE TENDER OF SHARES, THE PRICE AT WHICH
TO TENDER, OR WHETHER TO REFRAIN FROM DIRECTING THE TENDER OF SHARES. EACH
PARTICIPANT MUST MAKE HIS OR HER OWN DECISION ON THESE MATTERS.
T. Rowe Price has been directed by the Plan Administration Committee to
follow, on a timely basis, completed Direction Forms of participants with
respect to the Offer. T. Rowe Price has been directed by the Plan Administration
Committee NOT to tender Shares attributable to the individual accounts of
participants from whom T. Rowe Price has not received timely, properly completed
Direction Forms. Only in the event that T. Rowe Price determines that such
directions violate the Employee Retirement Income Security Act of 1974 as
amended ("ERISA") will T. Rowe Price exercise discretion with respect to the
tender of Shares held by the Savings Plan.
CONFIDENTIALITY
To assure the confidentiality of your decision, T. Rowe Price and its
affiliates or agents will tabulate the Direction Forms. Neither T. Rowe Price
nor its affiliates or agents will make the results of your individual direction
available to the Company.
HOW THE OFFER WORKS
The details of the Offer are described in the enclosed materials, which you
should review carefully. However, in broad outline, the transaction will work as
follows with respect to Savings Plan participants.
- The Company has offered to purchase up to 1,800,000 of its Shares at a
single per Share price not greater than $20.00 nor less than $17.50.
- If you want any of the Shares attributable to your individual account
under the Savings Plan sold on the terms and subject to the conditions of
the Offer, you need to instruct the Plan Administration Committee and T.
Rowe Price by completing the enclosed Direction Form and returning it in
the enclosed return envelope.
2
<PAGE> 3
- As described in Section 1 of the Offer to Purchase, if fewer than all
Shares validly tendered at or below the Purchase Price (as defined in the
Offer to Purchase) and not withdrawn prior to the Expiration Date (as
defined in the Offer to Purchase) are to be purchased, the Shares
purchased first will consist of all Shares tendered by "Odd Lot Owners"
who validly tendered all of their Shares at or below the Purchase Price
(including by not designating a Purchase Price as set forth in the Odd
Lot section of the Direction Form). "Odd Lot Owners" are shareholders,
including participants in the Savings Plan with Shares credited to their
individual accounts under the Savings Plan, who owned beneficially as of
the close of business on October 23, 1996, and continue to own
beneficially as of the Expiration Date, an aggregate of fewer than 100
Shares (including Shares credited to such participant's account under the
Savings Plan but excluding Restricted Shares (as defined in the Offer to
Purchase)). Partial tenders of Shares will not qualify for this
preference and this preference will not be available unless the box
captioned "Odd Lots" in the Direction Form is completed. Additionally,
tendering holders of Odd Lots who do not wish to specify a purchase price
may check the box in the section entitled "Odd Lots" indicating that such
shareholder is tendering all Shares at the Purchase Price determined by
the Company.
- You need to specify on the Direction Form the per Share price(s) (in
multiples of $.25), not greater than $20.00 nor less than $17.50, at
which you wish to tender the Shares attributable to your individual
account under the Savings Plan, except that tendering Odd Lot Owners who
do not wish to specify a purchase price may check the box in the section
entitled "Odd Lots" indicating that such shareholder is tendering all
Shares at the Purchase Price determined by the Company.
- The Offer, proration period and withdrawal rights will expire at 12:00
Midnight, New York City time, on November 21, 1996, unless the Company
extends the Offer. ACCORDINGLY, IN ORDER FOR T. ROWE PRICE TO MAKE A
TIMELY TENDER OF THE SHARES ATTRIBUTABLE TO YOUR INDIVIDUAL ACCOUNT UNDER
THE SAVINGS PLAN, YOU MUST COMPLETE AND RETURN THE ENCLOSED DIRECTION
FORM IN THE RETURN ENVELOPE SO THAT IT IS RECEIVED BY T. ROWE PRICE AT
THE ADDRESS ON THE RETURN ENVELOPE NOT LATER THAN 12:00 MIDNIGHT, NEW
YORK CITY TIME, ON MONDAY, NOVEMBER 18, 1996, UNLESS EXTENDED. Please
complete and return the direction form even if you decide not to
participate in the Offer. If T. Rowe Price does not receive a completed,
signed original Direction Form from you by such deadline, pursuant to the
terms of the Trust Agreement relating to the Savings Plan, T. Rowe Price
will NOT tender any of your Shares unless such Trust Agreement provision
violates ERISA.
- After the deadline above for returning the Direction Form to T. Rowe
Price, T. Rowe Price and its affiliates or agents will complete the
tabulation of all directions and T. Rowe Price, as Trustee, will tender
the appropriate number of Shares. For purposes of this tabulation, T.
Rowe Price will calculate the number of Shares representing your interest
in the Company Stock Fund allocated to your individual account based upon
the number of Shares held by the Company Stock Fund as of the close of
business on October 23, 1996.
- The Company will then determine the per Share purchase price (not greater
than $20.00 nor less than $17.50) (the "Purchase Price"), at which the
Company can purchase 1,800,000 Shares.
- Unless the Offer is terminated or amended in accordance with its terms,
the Company will then buy all of the Shares, up to 1,800,000, that were
tendered at the Purchase Price or below. Participants will receive the
same per Share Purchase Price, even if they tendered at or below the
Purchase Price.
- If you direct the tender of any Shares attributable to your individual
account at a price in excess of the Purchase Price as finally determined,
those Shares will not be purchased, and your interest in the Company
Stock Fund will remain allocated to your individual account under the
Savings Plan.
- If there is an excess of Shares tendered over the exact number desired by
the Company at the Purchase Price, Shares tendered pursuant to the Offer
may be subject to proration as set forth in Section 1 of the Offer to
Purchase. However, as described above, all Shares tendered by
participants who are Odd Lot Owners in accordance with Section 2 of the
Offer to Purchase will be purchased in the Offer without proration.
3
<PAGE> 4
- IMPORTANT: IF YOU DIRECT THE PLAN ADMINISTRATION COMMITTEE AND T. ROWE
PRICE TO TENDER SAVINGS PLAN SHARES REFLECTING YOUR INTEREST IN THE
COMPANY STOCK FUND AND THEY ARE REPURCHASED BY THE COMPANY, ANY PROCEEDS
WILL BE REINVESTED IN THE T. ROWE PRICE PRIME RESERVE ACCOUNT AS SOON AS
ADMINISTRATIVELY POSSIBLE AND SUCH INVESTMENT WILL BE CREDITED TO YOUR
INDIVIDUAL ACCOUNT.
- IF YOU WISH TO HAVE ANY PROCEEDS OF THE SALE OF SHARES REFLECTING YOUR
INTEREST IN THE COMPANY STOCK FUND WHICH WERE REINVESTED IN THE T. ROWE
PRICE PRIME RESERVE ACCOUNT INVESTED IN A DIFFERENT MANNER, SUBJECT TO
THE PROVISIONS OF THE SAVINGS PLAN, PLEASE CALL T. ROWE PRICE AT
1-800-922-9945 AFTER THE REINVESTMENT IS COMPLETE.
-- Only after such time will you be able to instruct T. Rowe Price to
invest any proceeds of the sale of shares reflecting your interest in
the Company Stock Fund (which will be invested in the T. Rowe Price
Prime Reserve Account) in any other manner.
This form of transaction is commonly called a modified Dutch auction and
requires some strategy on your part. For example, if you are anxious to sell,
you may want to tender the Shares attributable to your individual account at a
price at or near the lower limit. If you are not sure whether or not you want to
participate, but would be willing to sell at a price above the lower limit, then
you may want to specify a higher price, not to exceed the upper limit, of
course. If you do not want to sell for any price within the limits, you may
direct that Shares attributable to your individual account not be tendered into
the Offer.
PROCEDURE FOR DIRECTING TRUSTEE
A Direction Form for making your direction is enclosed. You must complete,
sign and return the enclosed original Direction Form in the return envelope so
that it is received at the address listed on the enclosed return envelope not
later than 12:00 Midnight, New York City time, on Monday, November 18, 1996,
unless extended. PLEASE COMPLETE AND RETURN THE DIRECTION FORM EVEN IF YOU
DECIDE NOT TO PARTICIPATE IN THE OFFER. If your Direction Form is not received
by this deadline, or if it is not fully or properly completed, the Shares
attributable to your individual account under the Savings Plan will not be
tendered. Please contact T. Rowe Price at 1 (800) 922-9945 to find out the
actual number of Shares attributable to your individual account that you may
tender in the Offer.
To properly complete your Direction Form, you must do the following:
(1) On the back of the Direction Form, check Box 1 or 2. CHECK ONLY ONE
BOX. Make your decision which box to check as follows:
- CHECK BOX 1 if you do not want the Shares attributable to your individual
account tendered for sale at any price and simply want the Savings Plan
to continue holding such Shares.
- CHECK BOX 2 in all other cases and either (i) complete the table
immediately below Box 2, specifying the percentage of Shares attributable
to your individual account that you want to tender at each price
indicated, or (ii) if you are an Odd Lot Owner and you wish to tender all
of the Shares attributable to your individual account, complete the
section entitled "Odd Lots."
If you do not complete the section entitled "Odd Lots," you may direct
the tender of Shares attributable to your individual account at different
prices. To do so, you must state the percentage of Shares to be sold at
each indicated price by filling in the percentage of such Shares on the
line immediately before the price. Leave a line blank if you want no
Shares reflecting your interest in the Company Stock Fund tendered at
that price. The total percentage of Shares reflecting your interest in
the Company Stock Fund tendered may not exceed 100%, but it may be less
than 100%. If this amount is less than 100%, you will be deemed to have
instructed T. Rowe Price NOT to tender the balance of the shares
attributable to your individual account under the Savings Plan.
4
<PAGE> 5
(2) Date and sign the Direction Form in the space provided.
(3) Return the Direction Form in the enclosed return envelope so that it is
received by T. Rowe Price at the address on the return envelope not later than
12:00 Midnight, New York City time, on Monday, November 18, 1996, unless
extended. Please complete and return the Direction Form even if you decide not
to participate in the Offer. NO FACSIMILE TRANSMITTALS OF THE DIRECTION FORM
WILL BE ACCEPTED.
Your direction will be deemed irrevocable unless withdrawn by 12:00
Midnight, New York City time, on Monday, November 18, 1996, unless extended. In
order to make an effective withdrawal, you must submit a new Direction Form
which may be obtained by calling T. Rowe Price at 1 (800) 922-9945. Your new
Direction Form must include your name, address and Social Security number. Upon
receipt of a new, completed and signed Direction Form, your previous direction
will be deemed cancelled. You may direct the re-tendering of any Shares
attributable to your individual account by obtaining an additional Direction
Form from T. Rowe Price and repeating the previous instructions for directing
tenders as set forth in this letter.
INVESTMENT OF TENDER PROCEEDS
For any Shares attributable to your individual account under the Savings
Plan that are tendered and purchased by the Company, the Company will pay cash
to the Savings Plan. In accordance with the Trust Agreement, T. Rowe Price will
invest the proceeds in the T. Rowe Price Prime Reserve Account as soon as
administratively possible and will credit such investment to your individual
account. You may call T. Rowe Price at 1 (800) 922-9945 after the reinvestment
is complete to have the proceeds of the sale of Shares which were invested in
the T. Rowe Price Prime Reserve Account invested in other investment options
offered under the Savings Plan.
INDIVIDUAL PARTICIPANTS IN THE SAVINGS PLAN WILL NOT RECEIVE ANY PORTION OF
THE TENDER PROCEEDS DIRECTLY. ALL SUCH PROCEEDS WILL REMAIN IN THE SAVINGS PLAN
AND MAY BE WITHDRAWN ONLY IN ACCORDANCE WITH THE TERMS OF THE SAVINGS PLAN.
For federal income tax purposes, no gain or loss will be recognized by
participants in the Savings Plan as a result of the tender or sale of Shares
held in the Savings Plan. However, certain tax benefits that may otherwise be
available in connection with the future withdrawal or distribution of Shares
from the Savings Plan may be adversely affected if Savings Plan Shares are
tendered and sold. Specifically, under current federal income tax rules, if a
participant receives a distribution of Shares in kind as part of a "lump sum"
withdrawal or distribution, the excess of the fair market value of the Shares on
the date of such withdrawal or distribution over the cost to the Savings Plan of
those Shares is excluded from the value of the withdrawal or distribution for
purposes of determining the participant's federal income tax liability with
respect to the withdrawal or distribution. Any excess in market value over the
cost will be taxed to the extent realized when the Shares are sold as long-term
capital gain. If you direct the Plan Administration Committee and T. Rowe Price
to tender Shares attributable to your individual account in the Offer, you may
adversely affect your ability to take advantage of this tax benefit. If you
direct the Plan Administration Committee and T. Rowe Price not to tender any
Shares attributable to your individual account, the cost of Shares attributable
to your individual account will not be affected.
SHARES OUTSIDE THE SAVINGS PLAN
If you hold Shares directly, you will receive, under separate cover, tender
offer materials directly from the Company, which can be used to tender such
Shares directly to the Company. Those tender offer materials may not be used to
direct the Plan Administration Committee and T. Rowe Price to tender or not
tender the Shares attributable to your individual account under the Savings
Plan. The direction to tender or not tender Shares attributable to your
individual account under the Savings Plan may only be made in accordance with
the procedures in this letter.
5
<PAGE> 6
FURTHER INFORMATION
If you require additional information concerning the terms and conditions
of the Offer, please call Georgeson & Company, Inc., the Information Agent, at
1(800)223-2064. If you require additional information concerning the procedure
to tender Shares attributable to your individual account under the Savings Plan,
please contact T. Rowe Price at 1(800)922-9945.
Sincerely,
HANDY & HARMAN
6
<PAGE> 7
QUESTIONS AND ANSWERS FOR SAVINGS PLAN PARTICIPANTS ABOUT THE HANDY & HARMAN
TENDER OFFER
Q. WHY IS THE COMPANY OFFERING THIS TENDER OFFER TO PARTICIPANTS IN THE SAVINGS
PLAN?
A. As a participant in the Savings Plan, you may have a proportional interest
in the Company Stock Fund. Under the terms of the Savings Plan, you have the
right to direct the investment of the contributions allocated to your
individual accounts. The contributions invested in the Company Stock Fund
represent a proportional interest in the assets of the Company Stock Fund.
The Company Stock Fund is held in an individual account for you by T. Rowe
Price (along with the plan's other investment funds). The Savings Plan
provides that in the event of a tender offer, you may direct the Plan
Administration Committee and T. Rowe Price to tender the number of shares of
Company common stock that reflect your proportional interest in the Company
Stock Fund.
Q. IF I DECIDE TO DIRECT THE PLAN ADMINISTRATION COMMITTEE AND T. ROWE PRICE TO
TENDER THE SHARES THAT REFLECT BY PROPORTIONAL INTEREST IN THE COMPANY STOCK
FUND, WILL I BE ABLE TO RECEIVE THE PROCEEDS?
A. No. All proceeds from any Savings Plan shares that are tendered and sold will
be automatically invested by T. Rowe Price in the T. Rowe Price Prime Reserve
Account. The proceeds will be part of your individual account and may not be
distributed except in accordance with the applicable terms of the Savings
Plan.
Q. WILL I BE ABLE TO CHANGE THE INVESTMENT FUNDS IN WHICH THE PROCEEDS OF
SAVINGS PLAN SHARES TENDERED ARE INVESTED?
A. Yes. Proceeds from the sale of Shares held by the Savings Plan may be
invested in a different manner subject to the provisions of the Savings Plan
by contacting T. Rowe Price at 1(800)922-9945 after the reinvestment is
complete.
Q. IS THERE A FORM I HAVE TO RETURN?
A. Included in this mailing is a "Direction Form." Complete and return this form
even if you decide not to direct the tender of any shares.
Q. WHAT IS THE DEADLINE FOR RETURNING THE DIRECTION FORM?
A. The form must be received by T. Rowe Price at the address on the return
envelope by 12:00 Midnight, on Monday, November 18, 1996, unless this
deadline is extended.
Q. WHAT IF I HAVE QUESTIONS?
A. Contact T. Rowe Price at 1(800)922-9945 for information on the procedure for
tendering the Shares reflecting your interest in the Company Stock Fund under
the Savings Plan. Contact Georgeson & Company Inc., the information agent for
the tender offer, at 1(800)223-2064 for questions on the terms and conditions
of the offer.
7
<PAGE> 8
DIRECTION FORM
FOR PARTICIPANTS IN THE
HANDY & HARMAN SAVINGS PLAN
BEFORE COMPLETING THIS FORM, PLEASE READ CAREFULLY THE ACCOMPANYING
OFFER TO PURCHASE AND ALL OTHER ENCLOSED MATERIALS.
The undersigned acknowledges receipt of the letter of Handy & Harman (the
"Company") and the enclosed Offer to Purchase, dated October 24, 1996, and the
related Letter of Transmittal (which Offer to Purchase and Letter of
Transmittal, as amended from time to time, together constitute the "Offer") in
connection with the Offer by Handy & Harman to purchase up to 1,800,000 shares
of its common stock, par value $1.00 per share (including the associated common
stock purchase rights) (the "Shares"), at prices not greater than $20.00 nor
less than $17.50 per Share, upon the terms and subject to the conditions of the
Offer. A tender of Shares pursuant to the Offer will include a tender of the
associated common stock purchase rights (the "Rights"). No separate
consideration will be paid for such Rights. For a description of the Rights, see
Section 7 of the Offer to Purchase.
This will instruct the Handy & Harman Savings Plan Administrative Committee
(the "Plan Administrative Committee") and T. Rowe Price Trust Company ("T. Rowe
Price") to tender to the Company the number of Shares indicated below that are
held by T. Rowe Price for the individual account of the undersigned in the
Company Stock Fund (as defined in the Offer to Purchase) under the Handy &
Harman 401(k) savings plan (the "Savings Plan"), at the price(s) per Share
indicated, upon the terms and subject to the conditions of the Offer.
For any Shares attributable to the individual account of the undersigned
under the Savings Plan that are tendered and purchased by the Company, the
Company will pay cash to the Savings Plan. In accordance with the terms of the
Savings Plan, T. Rowe Price will invest the proceeds in the T. Rowe Price Prime
Reserve Account as soon as administratively possible and will credit such
investment to your individual account. The undersigned may call T. Rowe Price at
1(800)922-9945 after the reinvestment is complete to have the proceeds of the
sale of Shares which were invested in the T. Rowe Price Prime Reserve Account
invested in other investment options offered under the Savings Plan.
INDIVIDUAL PARTICIPANTS IN THE SAVINGS PLAN WILL NOT RECEIVE ANY PORTION OF
THE TENDER PROCEEDS DIRECTLY. ALL SUCH PROCEEDS WILL REMAIN IN THE SAVINGS PLAN
AND MAY BE WITHDRAWN ONLY IN ACCORDANCE WITH THE TERMS OF THE SAVINGS PLAN.
INSTRUCTIONS
Carefully complete the form below, insert today's date, print your name,
address and Social Security number and sign in the spaces provided. Enclose this
Direction Form in the included envelope and mail it promptly. YOUR DIRECTION
FORM MUST BE RECEIVED BY T. ROWE PRICE AT THE ADDRESS ON THE RETURN ENVELOPE NOT
LATER THAN 12:00 MIDNIGHT, NEW YORK CITY TIME, ON MONDAY, NOVEMBER 18, 1996,
UNLESS THE OFFER IS EXTENDED. PLEASE COMPLETE AND RETURN THE DIRECTION FORM EVEN
IF YOU DECIDE NOT TO PARTICIPATE IN THE OFFER. Direction Forms that are not
fully or properly completed, dated, and signed, or that are received after the
deadline, will be disregarded, and the Shares reflecting your interest in the
Company Stock Fund will not be tendered. Note that T. Rowe Price also has the
right to disregard any direction that it determines cannot be carried out
without violating applicable law.
NONE OF THE COMPANY, ITS BOARD OF DIRECTORS, THE PLAN ADMINISTRATION
COMMITTEE, T. ROWE PRICE, ITS AFFILIATES, OR ANY OTHER PARTY MAKES ANY
RECOMMENDATIONS AS TO WHETHER TO DIRECT THE TENDER OF SHARES, THE PRICE AT WHICH
TO TENDER, OR WHETHER TO REFRAIN FROM DIRECTING THE TENDER OF SHARES. EACH
PARTICIPANT MUST MAKE HIS OR HER OWN DECISION ON THESE MATTERS.
<PAGE> 9
(CHECK ONLY ONE BOX)
/ / 1. Please refrain from tendering and continue to HOLD all Shares reflecting
my interest in the Company Stock Fund.
/ / 2. Please TENDER Shares reflecting my interest in the Company Stock Fund
either (i) in the percentage indicated below for each of the prices
provided, or (ii) if available, as set forth below under "Odd Lots."
The total of the percentages may NOT exceed 100%, but it may be less
than or equal to 100%. If the total of the percentages is less than
100%, T. Rowe Price will NOT tender the balance of the Shares reflecting
my interest in the Company Stock Fund. A blank space before a given
price will be taken to mean that no Shares reflecting my interest in the
Company Stock Fund are to be tendered at that price. FILL IN THE TABLE
BELOW ONLY IF YOU HAVE CHECKED BOX 2.
DO NOT FILL IN THE TABLE BELOW IF YOU ARE TENDERING YOUR SHARES UNDER
THE "ODD LOTS" SECTION, BELOW.
IF SHARES ARE BEING TENDERED AT MORE THAN ONE PRICE, STATE THE
PERCENTAGE OF SHARES TO BE SOLD AT EACH PRICE BY FILLING IN THE
PERCENTAGE OF SUCH SHARES ON THE LINE IMMEDIATELY BEFORE THE PRICE.
PRICE (IN DOLLARS) PER SHARE
AT WHICH SHARES ARE BEING TENDERED
<TABLE>
<S> <C> <C> <C>
-----% at $17.50 -----% at $18.25 -----% at $19.00 -----% at $19.75
-----% at $17.75 -----% at $18.50 -----% at $19.25 -----% at $20.00
-----% at $18.00 -----% at $18.75 -----% at $19.50
</TABLE>
ODD LOTS
This section is to be completed ONLY if (i) you have checked box 2, above,
(ii) you are tendering all of the Shares attributable to your individual account
under the Savings Plan, and (iii) your individual account was credited with, as
of the close of business on October 23, 1996, and continues to be credited with
as of the Expiration Date, an aggregate of fewer than 100 Shares.
/ / Please TENDER all of the Shares reflecting my interest in the Company Stock
Fund at the price set forth below:
PRICE (IN DOLLARS) PER SHARE
AT WHICH ALL ODD LOT SHARES ARE BEING TENDERED
CHECK ONLY ONE BOX. IF MORE THAN ONE BOX IS CHECKED, OR
IF NO BOX IS CHECKED (EXCEPT AS PROVIDED BELOW), THERE IS NO VALID
TENDER OF ODD LOT SHARES HEREUNDER.
<TABLE>
<S> <C> <C> <C> <C> <C>
/ / $17.50 / / $18.00 / / $18.50 / / $19.00 / / $19.50 / / $20.00
/ / $17.75 / / $18.25 / / $18.75 / / $19.25 / / $19.75
</TABLE>
If you do not wish to specify a purchase price, check the following box, in
which case you will be deemed to have tendered at the Purchase Price determined
by the Company in accordance with the terms of the Offer (persons checking this
box need not indicate the price per Share in the table entitled "Price (In
Dollars) Per Share At Which All Odd Lot Shares Are Being Tendered" above. / /
<PAGE> 10
RETURN THIS DIRECTION FORM IN THE ENCLOSED RETURN ENVELOPE SO THAT IT IS
RECEIVED AT THE ADDRESS ON THE RETURN ENVELOPE NOT LATER THAN 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON MONDAY, NOVEMBER 18, 1996, UNLESS EXTENDED.
Please complete and return this Direction Form even if you decide not to
participate in the Offer. NO FACSIMILE TRANSMITTALS OF THE DIRECTION FORM WILL
BE ACCEPTED.
SIGN HERE:
Dated: __________, 1996 Name:
(please print)
Address:
Social Security or Taxpayer ID No.
<PAGE> 1
FROM: ON BEHALF OF:
Robert W. Bloch International Handy & Harman
30 East 60th Street
New York, NY 10022 Contact: Stephen B. Mudd
Vice President and Treasurer
212 755 8047
212 309 0666
FOR IMMEDIATE RELEASE:
HANDY & HARMAN ANNOUNCES "DUTCH AUCTION" SELF-TENDER OFFER
TO REPURCHASE UP TO 1.8 MILLION SHARES
New York, NY--October 22, 1996. Handy & Harman (NYSE: HNH) announced today that
its Board of Directors has approved the making of a "Dutch Auction" self-tender
offer for 1.8 million shares of its common stock (or approximately 13% of its
outstanding shares). The offer will commence on October 24, 1996 and will expire
at midnight, New York city time, on the 20th business day after commencement of
the offer, unless the offer is extended. Under the terms of the offer, the
Company will invite shareholders to tender shares at prices between $17.50 and
$20.00 per share. Based upon the number of shares tendered and the prices
specified by the tendering shareholders, the Company will determine the single
per share price within that price range that will allow the Company to purchase
1.8 million shares or such lesser number of shares as are properly tendered. The
Company expects to fund the offer from cash on hand, sales of precious metals
inventory and the Company's existing long term credit facilities. Handy &
Harman's common stock price closed at $17.375 on the New York Stock Exchange on
October 21, 1996.
Richard N. Daniel, Chairman and Chief Executive Officer of the Company, said,
"We regard the repurchase of our shares as an attractive investment, and it is
consistent with our long term goal of increasing shareholder value. Even after
the repurchase, Handy & Harman will have adequate cash or cash equivalents and
borrowing capacity to fund internal growth opportunities and pursue acquisitions
that might become available."
J.P. Morgan will act as Dealer Manager and Georgeson & Company Inc. will act as
Information Agent for the offer.
Handy & Harman is a diversified manufacturer providing engineered products,
system components and precious metal fabrication for industry worldwide. Founded
in 1867, the Company is headquartered in New York.
# # #
<PAGE> 1
This announcement is neither an offer to purchase nor a solicitation
of an offer to sell Shares. The Offer is made solely by the Offer to
Purchase and the related Letter of Transmittal. The Offer is not
being made to, nor will the Company accept tenders from, holders of Shares in
any jurisdiction in which the Offer or its acceptance would violate that
jurisdiction's laws. The Company is not aware of any jurisdiction in which the
making of the Offer or the tender of Shares would not be in compliance with the
laws of such jurisdiction. In jurisdictions whose laws require that the Offer
be made by a licensed broker or dealer, the Offer shall be deemed to be made
on the Company's behalf by J.P. Morgan Securities Inc., or by one or more
registered brokers or dealers licensed under the laws of such jurisdiction.
Notice of Offer to Purchase for Cash
by
Handy & Harman
Up to 1,800,000 Shares of its Common Stock
(Including the Associated Common Stock Purchase Rights)
At a Purchase Price Not Greater Than $20.00
Nor Less Than $17.50 Per Share
Handy & Harman, a New York corporation (the "Company"), invites its
shareholders to tender up to 1,800,000 shares of its common stock and
the associated common stock purchase rights (collectively, the
"Shares") to the Company at prices not greater than $20.00 nor less
than $17.50 per Share in cash, specified by tendering shareholders,
upon the terms and subject to the conditions set forth in the Offer
to Purchase, dated October 24, 1996 (the "Offer to Purchase"), and
the related Letter of Transmittal (which, as amended from time to
time, together constitute the "Offer").
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT
12:00 MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY, NOVEMBER 21, 1996,
UNLESS THE OFFER IS EXTENDED.
The Offer is not conditioned on any minimum number of Shares being
tendered. The Offer is, however, subject to certain other conditions
set forth in the Offer to Purchase.
The Board of Directors of the Company has unanimously approved the
making of the Offer. However, shareholders must make their own
decisions whether to tender Shares and, if so, how many Shares to
tender and the price or prices at which Shares should be tendered.
Neither the Company nor its Board of Directors makes any
recommendation to any shareholder as to whether to tender or refrain
from tendering Shares. The Company has been advised that none of its
directors or executive officers intends to tender any Shares pursuant
to the Offer.
The Company will, upon the terms and subject to the conditions of the
Offer, determine a single per Share price (not greater than $20.00
nor less than $17.50 per Share), net to the seller in cash (the
"Purchase Price"), that it will pay for Shares validly tendered and
not withdrawn pursuant to the Offer, taking into account the number
of Shares so tendered and the prices specified by tendering
shareholders. The Company will select the lowest Purchase Price that
will allow it to buy 1,800,000 Shares (or such lesser number of
Shares as are validly tendered at prices not greater than $20.00 nor
less than $17.50 per Share) validly tendered and not withdrawn
pursuant to the Offer. The Company will pay the Purchase Price for
all Shares validly tendered prior to the Expiration Date (as defined
below) at prices at or below the Purchase Price and not withdrawn,
upon the terms and subject to the conditions of the Offer including
the proration terms described below. The term "Expiration Date" means
12:00 Midnight, New York City time, on Thursday, November 21, 1996,
unless and until the Company 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 the Company, shall expire.
The Company reserves the right, in its sole discretion, to purchase
more than 1,800,000 Shares pursuant to the Offer. For purposes of the
Offer, the Company will be deemed to have accepted for payment (and
therefore purchased), subject to proration, Shares that are validly
tendered at or below the Purchase Price and not withdrawn when, as
and if it gives oral or written notice to ChaseMellon Shareholder
Services, L.L.C. (the "Depositary"), of its acceptance of such Shares
for payment pursuant to the Offer. In all cases, payment for Shares
tendered and accepted for payment pursuant to the Offer will be made
promptly (subject to possible delay in the event of proration) but
only after timely receipt by the Depositary of certificates for such
Shares (or a timely confirmation of a book-entry transfer of such
Shares into the Depositary's account at one of the Book-Entry
Transfer Facilities (as defined in the Offer to Purchase)), a
properly completed and duly executed Letter of Transmittal (or
manually signed facsimile thereof) and any other required documents.
Upon the terms and subject to the conditions of the Offer, in the
event that more than 1,800,000 Shares (or such greater number of
Shares as the Company may elect to purchase pursuant to the Offer)
are validly tendered at or below the Purchase Price and not
withdrawn, the Company will purchase such validly tendered Shares in
the following order of priority: (i) all Shares validly tendered at or
below the Purchase Price and not withdrawn prior to the Expiration
Date by any Odd Lot Owner (as defined in the Offer to Purchase) who
tenders all such Shares (including Shares reflecting interests in the
Company Stock Fund (as defined in the Offer to Purchase) allocated to
the Savings Plan (as defined in the Offer to Purchase) but excluding
Restricted Shares (as defined in the Offer to Purchase)) beneficially
owned by such Odd Lot Owner at or below the Purchase Price (partial
tenders will not qualify for this preference) and who completes the
box captioned "Odd Lots" on the Letter of Transmittal and, if
applicable, on the Notice of Guaranteed Delivery, and (ii) after
purchase of all of the foregoing Shares, all other Shares validly
tendered at or below the Purchase Price prior to the Expiration Date
on a pro rata basis.
The Company's Board of Directors believes that, given the Company's
businesses, assets and prospects, the purchase of Shares pursuant to the Offer
is an attractive investment that will benefit the Company and its remaining
shareholders. The Company is making the Offer to use the Company's cash and
proceeds realized upon the sale of a portion of the Company's precious metals
inventory to improve the Company's capital structure and lower its cost of
capital for the benefit of its shareholders, and to afford to those
shareholders who desire liquidity an opportunity to sell all or a portion of
their Shares without the usual transaction costs associated with open market
sales. After the Offer is completed, the Company expects to have sufficient
cash flow and access to other sources of capital to fund its growth
initiatives, including building its businesses and making strategic
acquisitions.
The Company expressly reserves the right, at any time or from time to
time, in its sole discretion, to extend the period of time during
which the Offer is open by giving notice of such extension to the
Depositary and making a public announcement thereof. Subject to
certain conditions set forth in the Offer to Purchase, the Company
also expressly reserves the right to terminate the Offer and not
accept for payment any Shares not theretofore accepted for payment.
Shares tendered pursuant to the Offer may be withdrawn at any time
before the Expiration Date and, unless accepted for payment by the
Company as provided in the Offer to Purchase, may also be withdrawn
after 12:00 Midnight, New York City time, on Friday, December 20,
1996. For a withdrawal to be effective, the Depositary must receive a
notice of withdrawal in written, telegraphic or facsimile
transmission form in a timely manner. Such notice of withdrawal must
specify the name of the person who tendered the Shares to be
withdrawn, the number of Shares tendered, 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 the certificates have been delivered or
otherwise identified to the Depositary, then, prior to the release of such
certificates, the tendering shareholder must also submit the serial numbers
shown on the particular certificates evidencing the Shares and the signature
on the notice of withdrawal must be guaranteed by an Eligible
Institution (as defined in the Offer to Purchase) (except in the case
of Shares tendered by an Eligible Institution). If Shares have been
tendered pursuant to the procedure for book-entry transfer, the
notice of withdrawal must specify the name and the number of the
account at the applicable Book-Entry Transfer Facility to be credited
with the withdrawn Shares and otherwise comply with the procedures of
such facility.
The Offer to Purchase and the Letter of Transmittal contain important
information which should be read carefully before shareholders decide
whether to accept or reject the Offer and, if accepted, at what price
or prices to tender their shares. These materials are being mailed to
record holders of Shares and are being furnished to brokers, banks
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 transmittal to beneficial holders of Shares.
The information required to be disclosed by Rule 13e-4(d)(1) under
the Securities Exchange Act of 1934, as amended, is contained in the
Offer to Purchase and is incorporated by reference herein.
Additional copies of the Offer to Purchase and the Letter of
Transmittal may be obtained from the Information Agent and will be
furnished at the Company's expense. Questions and requests for
assistance may be directed to the Information Agent or the Dealer
Manager as set forth below:
The Information Agent for the Offer is:
[Georgeson & Company logo]
Wall Street Plaza
New York, New York 10005
Banks and Brokers Call Collect: (212) 440-9800
All Others Call Toll Free: (800) 223-2064
The Dealer Manager for the Offer is:
J.P. Morgan & Co.
60 Wall Street
Mail Stop 28MA
New York, New York 10260
(800) 576-9843 (toll free)
(212) 648-7833
October 24, 1996
<PAGE> 1
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>
<S> <C>
- -------------------------------------------------------
GIVE THE
FOR THIS TYPE OF ACCOUNT: TAXPAYER
IDENTIFICATION
NUMBER OF--
- -------------------------------------------------------
1. An individual's account The individual
2. Two or more individuals The actual owner of
(joint account) the account or, if
combined funds, any
one of the
individuals(1)
3. Husband and wife (joint The actual owner of
account) the account or, if
joint funds, either
person(1)
4. Custodian account of a minor The minor(2)
(Uniform Gift to Minors Act)
5. Adult and minor (joint The adult or, if the
account) minor is the only
contributor, the
minor(1)
6. Account in the name of The ward, minor, or
guardian or committee for a incompetent
designated ward, minor, or person(3)
incompetent person
7. a. The usual revocable The grantor-
savings trust account trustee(1)
(grantor is also trustee)
b. So-called trust account The actual owner(1)
that is not a legal or
valid trust under State
law
8. Sole proprietorship account The owner(4)
- -------------------------------------------------------
- -------------------------------------------------------
GIVE THE TAXPAYER
FOR THIS TYPE OF ACCOUNT: IDENTIFICATION
NUMBER OF--
- -------------------------------------------------------
9. A valid trust, estate, or The legal entity (Do
pension trust not furnish the
identifying number
of the personal
representative or
trustee unless the
legal entity itself
is not designated in
the account
title.)(5)
10. Corporate account The corporation
11. Religious, charitable, or The organization
educational organization
account
12. Partnership account held in The partnership
the name of the business
13. Association, club, or other The organization
tax-exempt organization
14. A broker or registered The broker or
nominee nominee
15. Account with the Department The public entity
of Agriculture in the name of
a public entity (such as a
State or local government,
school district, or prison)
that receives agricultural
program payments
- -------------------------------------------------------
</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> 2
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
PAGE 2
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 made to a nominee.
Payments of interest 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 made to a nominee.
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.
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 includible 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.
<PAGE> 1
Exhibit (b)(2) [EXECUTION COPY]
FIRST AMENDMENT
TO
REVOLVING CREDIT AGREEMENT
This FIRST AMENDMENT TO REVOLVING CREDIT AGREEMENT, dated as of June
30, 1995 (this "Amendatory Agreement"), among HANDY & HARMAN, a New York
corporation ("the Borrower"), certain financial institutions signatories hereto,
THE BANK OF NOVA SCOTIA, CHEMICAL BANK and THE BANK OF NEW YORK, as the
co-agents (collectively referred to herein as the "Co-Agents") and THE BANK OF
NOVA SCOTIA, as administrative agent (the "Administrative Agent").
W I T N E S S E T H:
WHEREAS, the Borrower, the Lenders (as defined below), the Co-Agents
and the Administrative Agent are parties to a Revolving Credit Agreement, dated
as of September 28, 1994 (as amended or otherwise modified to the date hereof,
the "Existing Credit Agreement"); and
WHEREAS, the parties hereto have agreed, subject to the conditions and
terms hereinafter set forth, to amend the Existing Credit Agreement in certain
respects as herein provided (the Existing Credit Agreement, as so amended by
this Amendatory Agreement, being referred to as the "Credit Agreement");
NOW, THEREFORE, in consideration of the agreements herein contained,
the parties hereto agree as follows:
PART I
DEFINITIONS
SUBPART 1.1. Certain Definitions. The following terms (whether or not
underscored) when used in this Amendatory Agreement shall have the following
meanings (such meanings to be equally applicable to the singular and plural form
thereof):
"Administrative Agent" is defined in the preamble.
"Amendatory Agreement" is defined in the preamble.
"Borrower" is defined in the preamble.
"Co-Agents" is defined in the preamble.
"Credit Agreement" is defined in the second recital.
"Existing Credit Agreement" is defined in the first recital.
"First Amendment Effective Date" is defined in Subpart 3.1.
<PAGE> 2
SUBPART 1.2. Other Definitions. Terms for which meanings are provided
in the Existing Credit Agreement are, unless otherwise defined herein or the
context otherwise requires, used in this Amendatory Agreement with such
meanings.
PART II
AMENDMENTS TO THE
EXISTING CREDIT AGREEMENT
Effective on (and subject to the occurrence of) the First Amendment
Effective Date, the Existing Credit Agreement is hereby amended in accordance
with this Part II; except as so amended, the Existing Credit Agreement shall
continue in full force and effect.
SUBPART 2.1. Amendment to Article I. Article I of the Existing Credit
Agreement is hereby amended in accordance with Subparts 2.1.1 through 2.1.2.
SUBPART 2.1.1. Section 1.1 of the Existing Credit Agreement is hereby
amended by inserting the following definition in such Section in the appropriate
alphabetical sequence:
"First Amendment" means the First Amendment, dated as of June
30, 1995, to this Agreement among the Borrower, the Lenders party
thereto, the Co-Agents and the Administrative Agent.
SUBPART 2.1.2. Section 1.1 of the Existing Credit Agreement is further
amended as follows:
(a) the definition of "Interest Coverage Ratio" appearing in
such Section is hereby amended in its entirety to read as follows:
"`Interest Coverage Ratio' means, at the close of any
Fiscal Quarter, the ratio, computed for the period
consisting of such Fiscal Quarter and each of the
three immediately preceding Fiscal Quarters, of
(a) EBIT
to
(b) Interest Expense;
provided, that the calculation of the Interest
Coverage Ratio from and after the First Amendment
Effective Date shall
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<PAGE> 3
exclude the effects of the non-recurring, pre-tax
charges in an aggregate amount not to exceed
$9,500,000 relating to Borrower's discontinuance of
its karat gold fabricating product line in East
Providence, Rhode Island and additional costs
primarily related to that division's ongoing
operation in Fairfield, Connecticut."
PART III
CONDITIONS TO EFFECTIVENESS
SUBPART 3.1. First Amendment Effective Date. This Amendatory Agreement
shall become effective as of the date first set forth above (the "First
Amendment Effective Date") when each of the conditions set forth in this Subpart
3.1 shall have been satisfied.
SUBPART 3.1.1. Execution of Counterparts. The Administrative Agent
shall have received counterparts of this Amendatory Agreement, duly executed on
behalf of the Borrower and the Required Lenders.
SUBPART 3.1.2. Legal Details, etc. All documents executed or submitted
pursuant hereto shall be satisfactory in form and substance to the
Administrative Agent and its counsel. The Administrative Agent and its counsel
shall have received all information and such counterpart originals or such
certified or other copies or such materials, as the Administrative Agent or its
counsel may reasonably request, and all legal matters incident to the
transactions contemplated by this Amendatory Agreement shall be satisfactory to
the Administrative Agent and its counsel.
PART IV
MISCELLANEOUS
SUBPART 4.1. Cross-References. References in this Amendatory Agreement
to any Part or Subpart are, unless otherwise specified or otherwise required by
the context, to such Part or Subpart of this Amendatory Agreement.
SUBPART 4.2. Loan Document Pursuant to Existing Credit Agreement. This
Amendatory Agreement is a Loan Document executed pursuant to the Existing Credit
Agreement and shall be construed, administered and applied in accordance with
all of the terms and provisions of the Existing Credit Agreement.
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<PAGE> 4
SUBPART 4.3. Successors and Assigns. This Amendatory Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
SUBPART 4.4. Counterparts. This Amendatory Agreement may be executed by
the parties hereto in several counterparts, each of which when executed and
delivered shall be deemed to be an original and all of which shall constitute
together but one and the same agreement.
SUBPART 4.5. Representations, No Default, etc. As of the
date of effectiveness of this Amendatory Agreement, the Borrower
hereby represents and warrants that
(a) the representations and warranties set forth in Article VI
of the Existing Credit Agreement (excluding, however, those contained
in Section 6.7 thereof) are true and correct in all material respects
(unless stated to relate solely to an earlier date, in which case such
representations and warranties were true and correct as of such earlier
date);
(b) except as disclosed by the Borrower to the
Administrative Agent and the Lenders pursuant to Section 6.7
of the Existing Credit Agreement,
(i) no litigation, arbitration or governmental
investigation or proceeding is pending or, to the knowledge of
the Borrower, threatened against the Borrower or any of its
Subsidiaries which may reasonably be expected to materially
adversely affect the Borrower's, or the Borrower and its
Subsidiaries' taken as a whole, financial condition,
operations, assets, businesses, properties or prospects or
which purports to affect the legality, validity or
enforceability of the Existing Credit Agreement, the Notes or
any other Loan Document; and
(ii) no development has occurred in any litigation,
arbitration or governmental investigation or proceeding
disclosed pursuant to Section 6.7 of the Existing Credit
Agreement which may reasonably be expected to materially
adversely affect the financial condition, operations, assets,
businesses, properties or prospects of the Borrower or the
Borrower and its Subsidiaries, taken as a whole; and
(c) after giving effect to this Amendatory Agreement,
no Default has occurred and is continuing.
SUBPART 4.6. Limited Waiver, etc. No amendment, waiver or
approval by the Issuer or any Lender under this Amendatory
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<PAGE> 5
Agreement shall, except as may be otherwise stated in this Amendatory Agreement,
be applicable to subsequent transactions. No waiver or approval hereunder shall
require any similar or dissimilar waiver or approval to be granted after the
date hereof, and except as expressly modified by this Amendatory Agreement, the
provisions of the Existing Credit Agreement shall remain in full force and
effect, without amendment or other modification.
SUBPART 4.7. Governing Law. THIS AMENDATORY AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
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<PAGE> 6
IN WITNESS WHEREOF, the parties hereto have caused this Amendatory
Agreement to be executed by their respective authorized officers as of the day
and year first above written.
HANDY & HARMAN
By______________________________________
Title:
THE BANK OF NOVA SCOTIA,
in its capacity as Administrative
Agent, Co-Agent and Lender
By______________________________________
Title:
THE BANK OF NEW YORK,
in its capacity as
Co-Agent and Lender
By______________________________________
Title:
CHEMICAL BANK, in its capacity
as Co-Agent and Lender
By______________________________________
Title:
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<PAGE> 7
FLEET BANK, N.A.
By______________________________________
Title:
NBD BANK
By______________________________________
Title:
THE BANK OF TOKYO TRUST COMPANY
By______________________________________
Title:
LTCB TRUST COMPANY
By______________________________________
Title:
SHAWMUT BANK, N.A.
By______________________________________
Title:
CREDIT LYONNAIS NEW YORK BRANCH
By______________________________________
Title:
CREDIT LYONNAIS CAYMAN ISLAND BRANCH
By______________________________________
Title:
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<PAGE> 8
THE DAIWA BANK, LIMITED
By______________________________________
Title:
By______________________________________
Title:
DEUTSCHE BANK AG, NEW YORK AND/OR
CAYMAN ISLANDS BRANCHES
By______________________________________
Title:
By______________________________________
Title:
THE FUJI BANK, LIMITED,
NEW YORK BRANCH
By______________________________________
Title:
NATWEST BANK N.A.
By______________________________________
Title:
ABN AMRO BANK N.V. NEW YORK BRANCH
By______________________________________
Title:
By______________________________________
Title:
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<PAGE> 9
BANQUE PARIBAS
By______________________________________
Title:
By______________________________________
Title:
GIROCREDIT BANK AG DER SPARKESSEN
GRAND CAYMAN ISLAND BRANCH
By______________________________________
Title:
By______________________________________
Title:
COMERICA BANK
By______________________________________
Title:
IBJ SCHRODER BANK & TRUST COMPANY
By______________________________________
Title:
THE MITSUBISHI BANK, LIMITED -
NEW YORK BRANCH
By______________________________________
Title:
YASUDA TRUST & BANKING CO., LTD.
NEW YORK BRANCH
By______________________________________
Title:
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<PAGE> 1
Exhibit (b)(3) [EXECUTION COPY]
SECOND AMENDMENT
TO
REVOLVING CREDIT AGREEMENT
This SECOND AMENDMENT TO REVOLVING CREDIT AGREEMENT, dated as of
September 24, 1996 (this "Amendatory Agreement"), is among HANDY & HARMAN, a New
York corporation (the "Borrower"), certain financial institutions signatories
hereto (the "Lenders"), THE BANK OF NOVA SCOTIA, THE CHASE MANHATTAN BANK
(formerly known as Chemical Bank) and THE BANK OF NEW YORK, as the co-agents
(collectively referred to herein as the "Co-Agents") and THE BANK OF NOVA
SCOTIA, as administrative agent (the "Administrative Agent").
W I T N E S S E T H:
WHEREAS, the Borrower, the Lenders, the Co-Agents and the
Administrative Agent are parties to a Revolving Credit Agreement, dated as of
September 28, 1994 (as amended or otherwise modified to the date hereof, the
"Existing Credit Agreement"); and
WHEREAS, the parties hereto have agreed, subject to the conditions and
terms hereinafter set forth, to amend the Existing Credit Agreement in certain
respects as herein provided (the Existing Credit Agreement, as so amended by
this Amendatory Agreement, being referred to as the "Credit Agreement");
NOW, THEREFORE, in consideration of the agreements herein contained,
the parties hereto agree as follows:
PART I
DEFINITIONS
SUBPART 1.1. Certain Definitions. The following terms (whether or not
underscored) when used in this Amendatory Agreement shall have the following
meanings (such meanings to be equally applicable to the singular and plural form
thereof):
"Administrative Agent" is defined in the preamble.
"Amendatory Agreement" is defined in the preamble.
"Borrower" is defined in the preamble.
"Co-Agents" is defined in the preamble.
"Credit Agreement" is defined in the second recital.
"Existing Credit Agreement" is defined in the first recital.
"Lenders" is defined in the preamble.
<PAGE> 2
"Second Amendment Effective Date" is defined in Subpart 4.1.
SUBPART 1.2. Other Definitions. Terms for which meanings are provided
in the Existing Credit Agreement are, unless otherwise defined herein or the
context otherwise requires, used in this Amendatory Agreement with such
meanings.
PART II
AMENDMENTS TO THE
EXISTING CREDIT AGREEMENT
AND EXTENSION OF STATED MATURITY DATE
Effective on (and subject to the occurrence of) the Second Amendment
Effective Date, the Existing Credit Agreement is hereby amended and the Stated
Maturity Date is hereby extended in accordance with this Part II; except as so
amended, the Existing Credit Agreement shall continue in full force and effect.
SUBPART 2.1. Amendments to Article I. Article I of the Existing Credit
Agreement is hereby amended in accordance with Subparts 2.1.1 through 2.1.2.
SUBPART 2.1.1. Section 1.1 of the Existing Credit Agreement is hereby
amended by inserting the following definitions in such Section in the
appropriate alphabetical sequence:
"Applicable Commitment Fee Margin" means the lowest per annum
rate determined by reference to the Net Debt to EBITDA Ratio and EBITDA
to Interest Ratio, in each case that is satisfied for each of such
ratios in a given clause below and as indicated in the Compliance
Certificate most recently delivered pursuant to clause (c) of Section
7.1.1, equal to:
(a) 0.15% if the Net Debt to EBITDA Ratio is less
than or equal to 1.75:1 and the EBITDA to Interest Ratio is
greater than or equal to 5.0:1;
(b) 0.20% if the Net Debt to EBITDA Ratio is less
than or equal to 2.25:1 and the EBITDA to Interest Ratio is
greater than or equal to 3.75:1;
(c) 0.25% if the Net Debt to EBITDA Ratio is less
than or equal to 2.75:1 and the EBITDA to Interest Ratio is
greater than or equal to 3.00:1; and
(d) 0.30% if the Net Debt to EBITDA Ratio is greater
than 2.75:1 or the EBITDA to Interest Ratio is less than
3.00:1.
The Net Debt to EBITDA Ratio and the EBITDA to Interest Ratio
used to compute the Applicable Commitment Fee Margin
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<PAGE> 3
shall be the Net Debt to EBITDA Ratio and the EBITDA to Interest Ratio,
as the case may be, set forth in the Compliance Certificate most
recently delivered by the Borrower to the Administrative Agent pursuant
to clause (c) of Section 7.1.1; changes in the Applicable Commitment
Fee Margin resulting from a change in the Net Debt to EBITDA Ratio
and/or the EBITDA to Interest Ratio, as the case may be, shall become
effective upon delivery by the Borrower to the Administrative Agent of
a new Compliance Certificate pursuant to clause (c) of Section 7.1.1.
Notwithstanding the foregoing, the Lenders acknowledge and agree that,
subject to the next sentence, the Applicable Commitment Fee Margin for
the period from the Second Amendment Effective Date through (but
excluding) the date that the first Compliance Certificate is delivered
following the Second Amendment Effective Date shall be determined by
reference to level (c) above (notwithstanding the actual Net Debt to
EBITDA Ratio and EBITDA to Interest Ratio for such period). If the
Borrower shall fail to deliver a Compliance Certificate within the
number of days after the end of any Fiscal Quarter as required pursuant
to clause (c) of Section 7.1.1 (without giving effect to any grace
period), the Applicable Commitment Fee Margin from and including the
first day after the date on which such Compliance Certificate was
required to be delivered to but not including the date the Borrower
delivers to the Administrative Agent a Compliance Certificate shall
conclusively equal the highest Applicable Commitment Fee Margin set
forth above.
"Applicable L/C Margin" means the lowest per annum rate
determined by reference to the Net Debt to EBITDA Ratio and EBITDA to
Interest Ratio, in each case that is satisfied for each of such ratios
in a given clause below and as indicated in the Compliance Certificate
most recently delivered pursuant to clause (c) of Section 7.1.1, equal
to:
(a) 0.40% if the Net Debt to EBITDA Ratio is less
than or equal to 1.75:1 and the EBITDA to Interest Ratio is
greater than or equal to 5.0:1;
(b) 0.55% if the Net Debt to EBITDA Ratio is less
than or equal to 2.25:1 and the EBITDA to Interest Ratio is
greater than or equal to 3.75:1;
(c) 0.70% if the Net Debt to EBITDA Ratio is less
than or equal to 2.75:1 and the EBITDA to Interest Ratio is
greater than or equal to 3.00:1; and
(d) 0.95% if the Net Debt to EBITDA Ratio is greater
than 2.75:1 or the EBITDA to Interest Ratio is less than
3.00:1.
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<PAGE> 4
The Net Debt to EBITDA Ratio and the EBITDA to Interest Ratio
used to compute the Applicable L/C Margin shall be the Net Debt to
EBITDA Ratio and the EBITDA to Interest Ratio, as the case may be, set
forth in the Compliance Certificate most recently delivered by the
Borrower to the Administrative Agent pursuant to clause (c) of Section
7.1.1; changes in the Applicable L/C Margin resulting from a change in
the Net Debt to EBITDA Ratio and/or the EBITDA to Interest Ratio, as
the case may be, shall become effective upon delivery by the Borrower
to the Administrative Agent of a new Compliance Certificate pursuant to
clause (c) of Section 7.1.1. Notwithstanding the foregoing, the Lenders
acknowledge and agree that, subject to the next sentence, the
Applicable L/C Margin for the period from the Second Amendment
Effective Date through (but excluding) the date that the first
Compliance Certificate is delivered following the Second Amendment
Effective Date shall be determined by reference to level (c) above
(notwithstanding the actual Net Debt to EBITDA Ratio and EBITDA to
Interest Ratio for such period). If the Borrower shall fail to deliver
a Compliance Certificate within the number of days after the end of any
Fiscal Quarter as required pursuant to clause (c) of Section 7.1.1
(without giving effect to any grace period), the Applicable L/C Margin
from and including the first day after the date on which such
Compliance Certificate was required to be delivered to but not
including the date the Borrower delivers to the Administrative Agent a
Compliance Certificate shall conclusively equal the highest Applicable
L/C Margin set forth above.
"Applicable LIBO Rate Margin" means, with respect to any Loan
made or maintained as a LIBO Rate Loan, the lowest per annum rate
determined by reference to the Net Debt to EBITDA Ratio and EBITDA to
Interest Ratio, in each case that is satisfied for each of such ratios
in a given clause below and as indicated in the Compliance Certificate
most recently delivered pursuant to clause (c) of Section 7.1.1, equal
to:
(a) 0.45% if the Net Debt to EBITDA Ratio is less
than or equal to 1.75:1 and the EBITDA to Interest Ratio is
greater than or equal to 5.0:1;
(b) 0.60% if the Net Debt to EBITDA Ratio is less
than or equal to 2.25:1 and the EBITDA to Interest Ratio is
greater than or equal to 3.75:1;
(c) 0.75% if the Net Debt to EBITDA Ratio is less
than or equal to 2.75:1 and the EBITDA to Interest Ratio is
greater than or equal to 3.00:1; and
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<PAGE> 5
(d) 1.00% if the Net Debt to EBITDA Ratio is greater
than 2.75:1 or the EBITDA to Interest Ratio is less than
3.00:1.
The Net Debt to EBITDA Ratio and the EBITDA to Interest Ratio
used to compute the Applicable LIBO Rate Margin shall be the Net Debt
to EBITDA Ratio and the EBITDA to Interest Ratio, as the case may be,
set forth in the Compliance Certificate most recently delivered by the
Borrower to the Administrative Agent pursuant to clause (c) of Section
7.1.1; changes in the Applicable LIBO Rate Margin resulting from a
change in the Net Debt to EBITDA Ratio and/or the EBITDA to Interest
Ratio, as the case may be, shall become effective upon delivery by the
Borrower to the Administrative Agent of a new Compliance Certificate
pursuant to clause (c) of Section 7.1.1. Notwithstanding the foregoing,
the Lenders acknowledge and agree that, subject to the next sentence,
the Applicable LIBO Rate Margin for the period from the Second
Amendment Effective Date through (but excluding) the date that the
first Compliance Certificate is delivered following the Second
Amendment Effective Date shall be determined by reference to level (c)
above (notwithstanding the actual Net Debt to EBITDA Ratio and EBITDA
to Interest Ratio for such period). If the Borrower shall fail to
deliver a Compliance Certificate within the number of days after the
end of any Fiscal Quarter as required pursuant to clause (c) of Section
7.1.1 (without giving effect to any grace period), the Applicable LIBO
Rate Margin from and including the first day after the date on which
such Compliance Certificate was required to be delivered to but not
including the date the Borrower delivers to the Administrative Agent a
Compliance Certificate shall conclusively equal the highest Applicable
LIBO Rate Margin set forth above.
"EBITDA" means, for any period, the sum for such period of all
amounts which, in accordance with GAAP, would be included on the
consolidated financial statements of the Borrower and its Subsidiaries
as
(a) EBIT;
plus
(b) the amount deducted, in determining Net
Income, representing amortization;
plus
(c) the amount deducted, in determining Net
Income, representing depreciation of assets.
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<PAGE> 6
"EBITDA to Interest Ratio" means, at the close of any Fiscal
Quarter, the ratio, computed for the period consisting of such Fiscal
Quarter and each of the three immediately preceding Fiscal Quarters, of
(a) EBITDA
to
(b) Interest Expense.
"Net Debt to EBITDA Ratio" means, at the last day of any
Fiscal Quarter, the ratio, computed (in the case of clause (b) below)
for the period consisting of such Fiscal Quarter and each of the three
immediately preceding Fiscal Quarters, of
(a) Debt minus the aggregate amount of cash and Cash
Equivalent Investments (not subject to any Lien or other
encumbrance) owned by the Borrower and its Subsidiaries on
such last day
to
(b) EBITDA.
"Second Amendment" means the Second Amendment, dated as of
September 24, 1996, to this Agreement among the Borrower, the Lenders
party thereto, the Co-Agents and the Administrative Agent.
"Second Amendment Effective Date" means the Second
Amendment Effective Date as defined in Subpart 4.1 of the
Second Amendment.
SUBPART 2.1.2. Section 1.1 of the Existing Credit Agreement is further
amended by amending the definition of "Loan Commitment Amount" appearing in such
Section in its entirety to read as follows:
"`Loan Commitment Amount' means, on any day, $150,000,000, as
such amount may be reduced from time to time pursuant to Section 2.2."
SUBPART 2.2. Amendments to Article III. Article III of the Existing
Credit Agreement is hereby amended in accordance with Subparts 2.2.1 and 2.2.2.
SUBPART 2.2.1. Clause (ii) of Section 3.2.1 of the Existing Credit
Agreement is hereby amended in its entirety to read as follows:
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<PAGE> 7
"(ii) On that portion of such Borrowing maintained as LIBO
Rate Loans, during each Interest Period applicable thereto, such rate
shall be equal to the sum of the LIBO Rate (Reserve Adjusted) for such
Interest Period plus the Applicable LIBO Rate Margin; and"
SUBPART 2.2.2. Section 3.3.1 of the Existing Credit Agreement is hereby
amended by deleting the words "at the rate of 3/8 of 1% per annum" and inserting
the words "equal to the Applicable Commitment Fee Margin" in place thereof.
SUBPART 2.2.3. Section 3.3.2 of the Existing Credit Agreement is hereby
amended by (i) deleting the words "at the rate of 7/8 of 1% per annum" appearing
in clause (x) of such Section and inserting the words "equal to the Applicable
L/C Margin" in place thereof and (ii) deleting the words "at the rate of 1/4 of
1% per annum" appearing in clause (y) of such Section and inserting the words
"at the rate of 0.1875% per annum" in place thereof.
SUBPART 2.3. Amendments to Exhibits. Exhibit A-1 (Form of Revolving
Note), Exhibit A-2 (Form of Competitive Bid Loan Note) and Exhibit E (Compliance
Certificate) to the Existing Credit Agreement are hereby amended in their
entirety to read as respectively set forth on Exhibits A, B and C hereto.
SUBPART 2.4. Extension of Stated Maturity Date. By their signatures
below, the parties hereto hereby agree that, in accordance with the terms of
Section 2.4 of the Existing Credit Agreement, upon the effectiveness of this
Amendatory Agreement, the Stated Maturity Date shall be September 27, 1999.
PART III
ACKNOWLEDGEMENT
SUBPART 3.1. Acknowledgement. By their signature below, each of the
Lenders acknowledges and agrees that, as of the Second Amendment Effective Date
(and notwithstanding any reductions to the Loan Commitment Amount that have
occurred prior to the Second Amendment Effective Date), the Loan Commitment
Amount is $150,000,000, as such amount may be reduced from time to time pursuant
to Section 2.2 of the Credit Agreement.
PART IV
CONDITIONS TO EFFECTIVENESS
SUBPART 4.1. Second Amendment Effective Date. This
Amendatory Agreement shall become effective on the date first set
forth above (the "Second Amendment Effective Date") when each of
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<PAGE> 8
the conditions set forth in this Subpart 4.1 shall have been satisfied.
SUBPART 4.1.1. Execution of Counterparts. The Administrative Agent
shall have received counterparts of this Amendatory Agreement, duly executed on
behalf of the Borrower and each of the Lenders.
SUBPART 4.1.2. Resolutions, etc. The Administrative Agent shall have
received from the Borrower, with copies for each Lender, a certificate, dated
the Second Amendment Effective Date, of its Secretary or Assistant Secretary as
to
(a) resolutions of its Board of Directors, then in full force
and effect, authorizing the execution, delivery and performance of this
Amendatory Agreement and each other Loan Document to be executed by it
in connection with this Amendatory Agreement; and
(b) the incumbency and signatures of its officers authorized
to execute and deliver, and act with respect to, this Amendatory
Agreement, each other Loan Document and each of the other documents,
certificates, instruments and other agreements delivered or to be
delivered by it pursuant to this Amendatory Agreement and pursuant to
the Credit Agreement.
Each of the Lenders and the Agents may conclusively rely upon such certificate
until the Administrative Agent has received a further certificate of the
Secretary or an Assistant Secretary of the Borrower cancelling or amending such
prior certificate.
SUBPART 4.1.3. Fees and Expenses. The Administrative Agent shall have
received payment in full of (i) an amendment fee in an amount equal to $155,875
for the pro rata account of the Lenders as set forth on Schedule I and (ii) all
other fees, costs and expenses due and payable as of the Second Amendment
Effective Date.
SECTION 4.1.4. Opinions of Counsel. The Administrative Agent shall have
received opinions, dated the Second Amendment Effective Date and addressed to
the Issuer, the Agents and all Lenders, from counsel to the Borrower, in form
and substance satisfactory to the Adminstrative Agent.
SUBPART 4.1.5. Delivery of Notes. The Administrative Agent shall have
received, for the account of each Lender, Notes, issued in substitution and
exchange for, and not in satisfaction of, the Notes delivered under the terms of
the Existing Credit Agreement, duly executed and delivered by the Borrower.
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<PAGE> 9
SUBPART 4.1.6. Legal Details, etc. All documents executed or submitted
pursuant hereto shall be satisfactory in form and substance to the
Administrative Agent and its counsel. The Administrative Agent and its counsel
shall have received all information and such counterpart originals or such
certified or other copies or such materials, as the Administrative Agent or its
counsel may reasonably request, and all legal matters incident to the
transactions contemplated by this Amendatory Agreement shall be satisfactory to
the Administrative Agent and its counsel.
PART V
MISCELLANEOUS
SUBPART 5.1. Cross-References. References in this Amendatory Agreement
to any Part or Subpart are, unless otherwise specified or otherwise required by
the context, to such Part or Subpart of this Amendatory Agreement.
SUBPART 5.2. Loan Document Pursuant to Existing Credit Agreement. This
Amendatory Agreement is a Loan Document executed pursuant to the Existing Credit
Agreement and shall be construed, administered and applied in accordance with
all of the terms and provisions of the Existing Credit Agreement.
SUBPART 5.3. Successors and Assigns. This Amendatory Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
SUBPART 5.4. Counterparts. This Amendatory Agreement may be executed by
the parties hereto in several counterparts, each of which when executed and
delivered shall be deemed to be an original and all of which shall constitute
together but one and the same agreement.
SUBPART 5.5. Representations, No Default, etc. As of the date of
effectiveness of this Amendatory Agreement, the Borrower hereby represents and
warrants to the Agents, the Issuer and the Lenders that
(a) the representations and warranties set forth in Article VI
of the Existing Credit Agreement (excluding, however, those contained
in Section 6.7 thereof) are true and correct in all material respects
(unless stated to relate solely to an earlier date, in which case such
representations and warranties were true and correct as of such earlier
date);
(b) except as disclosed by the Borrower to the Administrative
Agent and the Lenders pursuant to Section 6.7 of the Existing Credit
Agreement,
-9-
<PAGE> 10
(i) no litigation, arbitration or governmental
investigation or proceeding is pending or, to the knowledge of
the Borrower, threatened against the Borrower or any of its
Subsidiaries which may reasonably be expected to materially
adversely affect the Borrower's, or the Borrower and its
Subsidiaries' taken as a whole, financial condition,
operations, assets, businesses, properties or prospects or
which purports to affect the legality, validity or
enforceability of the Existing Credit Agreement, the Notes or
any other Loan Document; and
(ii) no development has occurred in any litigation,
arbitration or governmental investigation or proceeding
disclosed pursuant to Section 6.7 of the Existing Credit
Agreement which may reasonably be expected to materially
adversely affect the financial condition, operations, assets,
businesses, properties or prospects of the Borrower or the
Borrower and its Subsidiaries, taken as a whole; and
(c) no Default has occurred and is continuing.
SUBPART 5.6. Limited Waiver, etc. No amendment, waiver or approval by
the Agents, the Issuer or any Lender under this Amendatory Agreement shall,
except as may be otherwise stated in this Amendatory Agreement, be applicable to
subsequent transactions. No amendment, waiver or approval hereunder shall
require any similar or dissimilar amendment, waiver or approval to be granted
after the date hereof, and except as expressly modified by this Amendatory
Agreement, the provisions of the Existing Credit Agreement shall remain in full
force and effect, without amendment or other modification.
SUBPART 5.7. Governing Law. THIS AMENDATORY AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
-10-
<PAGE> 11
IN WITNESS WHEREOF, the parties hereto have caused this Amendatory
Agreement to be executed by their respective authorized officers as of the day
and year first above written.
HANDY & HARMAN
By______________________________________
Title:
THE BANK OF NOVA SCOTIA,
in its capacity as Administrative
Agent, Co-Agent and Lender
By______________________________________
Title:
<PAGE> 12
THE BANK OF NEW YORK,
in its capacity as
Co-Agent and Lender
By______________________________________
Title:
<PAGE> 13
THE CHASE MANHATTAN BANK (formerly known
as Chemical Bank), in its capacity as
Co-Agent and Lender
By______________________________________
Title:
<PAGE> 14
FLEET PRECIOUS METALS INC.
By______________________________________
Title:
<PAGE> 15
THE FIRST NATIONAL BANK OF CHICAGO
(formerly known as NBD Bank)
By______________________________________
Title:
<PAGE> 16
BANK OF TOKYO - MITSUBISHI TRUST
COMPANY
By______________________________________
Title:
<PAGE> 17
LTCB TRUST COMPANY
By______________________________________
Title:
<PAGE> 18
CREDIT LYONNAIS NEW YORK BRANCH
By______________________________________
Title:
CREDIT LYONNAIS CAYMAN ISLAND BRANCH
By______________________________________
Title:
<PAGE> 19
THE SUMITOMO BANK, LIMITED
By______________________________________
Title:
By______________________________________
Title:
<PAGE> 20
DEUTSCHE BANK AG, NEW YORK AND/OR
CAYMAN ISLANDS BRANCHES
By______________________________________
Title:
By______________________________________
Title:
<PAGE> 21
THE FUJI BANK, LIMITED,
NEW YORK BRANCH
By______________________________________
Title:
<PAGE> 22
ABN AMRO BANK N.V. NEW YORK BRANCH
By______________________________________
Title:
By______________________________________
Title:
<PAGE> 23
BANQUE PARIBAS
By______________________________________
Title:
By______________________________________
Title:
<PAGE> 24
GIROCREDIT BANK AG DER SPARKESSEN
GRAND CAYMAN ISLAND BRANCH
By______________________________________
Title:
By______________________________________
Title:
<PAGE> 25
COMERICA BANK
By______________________________________
Title:
<PAGE> 26
IBJ SCHRODER BANK & TRUST COMPANY
By______________________________________
Title:
<PAGE> 27
YASUDA TRUST & BANKING CO., LTD.
NEW YORK BRANCH
By______________________________________
Title:
<PAGE> 28
SCHEDULE I
TO SECOND AMENDMENT
<TABLE>
<CAPTION>
Allocation of Amendment Fee
---------------------------
Lender Amount
------ ------
<S> <C>
$
---------
</TABLE>
<PAGE> 29
EXHIBIT A
TO SECOND AMENDMENT
EXHIBIT A-1
Revolving Loan Note
$____________ September 28, 1994
FOR VALUE RECEIVED, the undersigned, HANDY & HARMAN, a New York
corporation (the "Borrower"), promises to pay to the order of
_________________________ (the "Lender") on the Stated Maturity Date (as such
term is defined in the Credit Agreement referred to below), the principal sum of
______________ DOLLARS ($__________) or, if less, the aggregate unpaid principal
amount of all Revolving Loans (as such term is defined in the Revolving Credit
Agreement, dated as of the date hereof (as such Revolving Credit Agreement may
be amended, supplemented, amended and restated or otherwise modified from time
to time, the "Credit Agreement"), among the Borrower, The Bank of Nova Scotia,
The Chase Manhattan Bank (formerly known as Chemical Bank) and The Bank of New
York, as Co-Agents, The Bank of Nova Scotia, as Administrative Agent and certain
financial institutions (including the Lender) as are, or may become, parties
thereto), made by the Lender pursuant to the Credit Agreement. A notation
indicating all Revolving Loans made by the Lender pursuant to the Credit
Agreement and payments on account of principal of such Revolving Loans may, from
time to time, be made by the holder hereof on the grid attached to this
Revolving Loan Note. Unless otherwise defined herein or the context otherwise
requires, terms used herein have the meanings provided in the Credit Agreement.
The unpaid principal amount of this Revolving Loan Note from time to
time outstanding shall bear interest as provided in Section 3.2.1 of the Credit
Agreement. All payments of principal of and interest on this Revolving Loan Note
shall be payable in lawful currency of the United States of America to the
account designated by the Administrative Agent in same day funds.
This Revolving Loan Note represents a renewal of, and is issued in
substitution and exchange for, and not in satisfaction of, that certain
Revolving Loan Note of the Borrower, dated September 28, 1994, payable to the
order of the Lender (or its assignor). The indebtedness originally evidenced by
such promissory note is a continuing Indebtedness, and nothing herein contained
shall be construed to deem such promissory note paid.
This Revolving Loan Note is one of the Revolving Loan Notes referred to
in, and evidences indebtedness incurred in respect of
<PAGE> 30
the Revolving Loans under, the Credit Agreement, to which reference is made for
a statement of the terms and conditions on which the Borrower is permitted and
required to make prepayments of principal of the indebtedness evidenced by this
Revolving Loan Note and on which such indebtedness may be declared to be or may
become immediately due and payable.
-2-
<PAGE> 31
THIS REVOLVING LOAN NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK, AND
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF
THE STATE OF NEW YORK.
HANDY & HARMAN
By______________________________________
Title:
-3-
<PAGE> 32
GRID
<TABLE>
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C>
LAST DAY
OF
APPLICABLE AMOUNT OF OUTSTANDING
AMOUNT OF ALTERNATE INTEREST PRINCIPAL PRINCIPAL NOTATION MADE
DATE LOAN BASE RATE LIBO RATE PERIOD PAYMENT BALANCE BY
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
====================================================================================================================================
</TABLE>
-4-
<PAGE> 33
EXHIBIT B
TO SECOND AMENDMENT
Exhibit A-2
Competitive Bid Loan Note
$150,000,000 September 28, 1994
FOR VALUE RECEIVED, the undersigned, HANDY & HARMAN, a New York
corporation (the "Borrower"), promises to pay to the order of
_______________________ (the "Lender") on the earlier of (i) each Competitive
Bid Loan Maturity Date (as such term is defined in that certain Revolving Credit
Agreement, dated as of the date hereof (as such Revolving Credit Agreement may
be amended, supplemented, amended and restated or otherwise modified from time
to time, the "Credit Agreement"), among the Borrower, The Bank of Nova Scotia,
The Chase Manhattan Bank (formerly known as Chemical Bank) and The Bank of New
York, as Co-Agents, The Bank of Nova Scotia, as Administrative Agent and certain
financial institutions (including the Lender) as are, or may from time to time
become parties thereto), and (ii) the Commitment Termination Date (as defined in
the Credit Agreement), the principal sum of ONE HUNDRED FIFTY MILLION DOLLARS
($150,000,000) or, if less, the unpaid principal amount of all Competitive Bid
Loans made by the Lender to the Borrower from time to time pursuant to Section
2.4. of the Credit Agreement. A notation indicating all Competitive Bid Loans
made by the Lender pursuant to the Credit Agreement and all payments on account
of principal of such Competitive Bid Loans may, from time to time, be made by
the holder hereof on the grid attached to this Competitive Bid Loan Note.
The unpaid principal amount of this Competitive Bid Loan Note from time
to time outstanding shall bear interest as provided in Section 3.2.1 of the
Credit Agreement. All payments of principal of and interest on this Competitive
Bid Loan Note shall be payable in lawful currency of the United States of
America to the account designated by the Administrative Agent in same day funds.
This Competitive Bid Loan Note represents a renewal of, and is issued in
substitution and exchange for, and not in satisfaction of, that certain
Competitive Bid Loan Note of the Borrower, dated September 28, 1994, payable to
the order of the Lender (or its assignor). The indebtedness originally evidenced
by such promissory note is a continuing indebtedness, and nothing herein
contained shall be construed to deem such promissory note paid.
<PAGE> 34
This Competitive Bid Loan Note is one of the Competitive Bid Loan Notes
referred to in, and evidences indebtedness incurred in respect of Competitive
Bid Loans under, the Credit Agreement, to which reference is made for a
statement of the terms and conditions on which the Borrower is permitted and
required to make prepayments of principal of the indebtedness evidenced by this
Competitive Bid Loan Note and on which such indebtedness may be declared to be
or may become immediately due and payable. Unless otherwise defined herein or
the context otherwise requires, terms used herein have the meanings provided in
the Credit Agreement.
THIS COMPETITIVE BID LOAN NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK
AND SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL
LAWS OF THE STATE OF NEW YORK.
HANDY & HARMAN
By______________________________________
Title:
-2-
<PAGE> 35
GRID
<TABLE>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
COMPETITIVE
BID LOAN AMOUNT OF AMOUNT OF OUTSTANDING
AMOUNT MATURITY INTEREST INTEREST PRINCIPAL PRINCIPAL NOTATION
DATE OF LOAN DATE PERIOD PAYMENT PAYMENT BALANCE MADE BY
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
-3-
<PAGE> 36
EXHIBIT C
TO SECOND AMENDMENT
Form of Compliance Certificate
To: Each of the Lenders
(as defined below)
-and-
The Bank of Nova Scotia,
as Administrative Agent
One Liberty Plaza
New York, New York 10006
Attention: ______________
Handy & Harman
Gentlemen:
This Compliance Certificate is being delivered pursuant to clause (c)
of Section 7.1.1 of the Revolving Credit Agreement, dated as of September 28,
1994 (as amended, supplemented, amended and restated or otherwise modified, the
"Credit Agreement"), among Handy & Harman, a New York corporation (the
"Borrower"), certain financial institutions now or hereafter parties thereto
(the "Lenders"), The Bank of Nova Scotia, The Chase Manhattan Bank (formerly
known as Chemical Bank) and The Bank of New York, as Co-Agents for the Lenders
and The Bank of Nova Scotia, as Administrative Agent. Terms used herein without
definition shall have the meanings assigned to such terms in Section 1.1 of the
Credit Agreement.
The Borrower hereby certifies, represents and warrants that as of
_________ __, 19__ (the "Computation Date"):
(a) The Adjusted Consolidated Tangible Net Worth was $__________, as
computed on Attachment 1 hereto and such amount [complies] [does not comply]
with the provisions of clause (a) of Section 7.2.4 of the Credit Agreement;
(b) The Leverage Ratio was __:1.00, as computed on Attachment 2 hereto
and such ratio [complies] [does not comply] with the provisions of clause (b) of
Section 7.2.4 of the Credit Agreement;
(c) The Interest Coverage Ratio was __:1.00, as computed on Attachment
3 hereto and such ratio [complies] [does not comply] with the provisions of
clause (c) of Section 7.2.4 of the Credit Agreement;
<PAGE> 37
(d) The Net Debt to EBITDA Ratio was __:1.00 and the EBITDA to Interest
Ratio was __:1.00, as computed on Attachment 4 hereto;
(e) The aggregate amount of Designated Debt of the Borrower and its
Subsidiaries was $_________ as computed on Attachment 5 hereto and such amount
[complies] [does not comply] with clause (a) of Section 7.2.2 of the Credit
Agreement;
(f) The aggregate amount of Debt of all Subsidiaries was $_________,
and such amount [complies] [does not comply] with clause (b) of Section 7.2.2 of
the Credit Agreement;
(g) The aggregate face amount of Indebtedness in respect of letters of
credit (other than Letters of Credit) was $________, and such amount [complies]
[does not comply] with clause (a)(ii)(B) of Section 7.2.2 of the Credit
Agreement;
(h) The aggregate amount of Investments (other than the Investments
permitted by clauses (a) through (f) of Section 7.2.5 of the Credit Agreement)
made, incurred, assumed or otherwise existing by the Borrower and its
Subsidiaries was $_________ and such amount [complies] [does not comply] with
clause (g) of Section 7.2.5 of the Credit Agreement;
(i) The aggregate amount of rental obligations entered into by the
Borrower and its Subsidiaries of the type set forth in Section 7.2.8 of the
Credit Agreement was $_________ and such amount [complies] [does not comply]
with Section 7.2.8 of the Credit Agreement;
(j) The aggregate book value or market value, if higher (determined as
to particular assets as of the respective date of disposition thereof) (other
than in accordance with clauses (a), (b) and (c) of Section 7.2.11 of the Credit
Agreement) of all assets sold, transferred, leased, contributed or otherwise
conveyed by the Borrower and its Subsidiaries (i) since the Effective Date was
$__________ and such amount [complies] [does not comply] with clause (d)(i) of
Section 7.2.11 of the Credit Agreement, and (ii) constitutes assets which
contributed __% of operating profit contribution during the three most recently
completed Fiscal Years of the Borrower, and such amount [complies][does not
comply] with clause (d)(ii) of Section 7.2.11 of the Credit Agreement;
(k) No Default has occurred and is continuing [other than
as follows:];
(l) The total market value of precious metal held on
consignment by the Borrower and its Subsidiaries was $__________;
-2-
<PAGE> 38
(m) The total number of ounces of precious metal held on consignment at
each Plant (as defined in the Consignment Facilities) under the terms of the
Consignment Facilities was ; and
(n) The total number of ounces of U.S. Bullion (as defined
in the Consignment Facilities) located at each Plant was ______.
(o) Based on paragraph (d) above, the Applicable LIBO Rate Margin is
___%, the Applicable L/C Margin is ___% and the Applicable Commitment Fee Margin
is ___%.
IN WITNESS WHEREOF, the Borrower has caused this Compliance Certificate
to be executed and delivered by its duly Authorized Officer on this ____ day of
_________, 19__.
HANDY & HARMAN
By______________________________________
Title:
-3-
<PAGE> 39
ATTACHMENT 1
(to __/__/__ Compliance
Certificate)
ADJUSTED CONSOLIDATED TANGIBLE NET WORTH
(________ __, 19__)
1. ADJUSTED CONSOLIDATED
TANGIBLE NET WORTH:
<TABLE>
<S> <C>
A. The par value (or value stated on
the books of the Borrower) of the
capital stock of all classes of the
Borrower..................................................$_________
B. The amount of the consolidated
surplus, whether capital or earned,
of the Borrower and its
and its Subsidiaries..................................... $_________
C. The sum (or difference, in the
case of a surplus deficit in
Item 1.B) of Items 1.A and 1.B........................... $_________
D. The aggregate amount of treasury
stock, subscribed but unissued
stock, unamortized debt discount
and expense, good will, trademarks,
trade names, patents and other
intangible assets (but not deferred
charges) of the Borrower and its
Subsidiaries ............................................ $_________
E. The aggregate amount of all write-
ups in the book value of any assets
owned by the Borrower or its
Subsidiaries subsequent to
March 16, 1992, other than write-ups
of assets (and assets of Subsidiaries)
acquired by the Borrower and/or its
Subsidiaries (exclusive of goodwill)
that are made in connection with the
acquisition thereof ..................................... $_________
F. Sum of Items 1.D through 1.E $_________
--------- ---
G. CONSOLIDATED TANGIBLE NET WORTH:
The excess of Item 1.C over Item 1.F..................... $_________
H. 40% of the excess of the Market
</TABLE>
<PAGE> 40
<TABLE>
<S> <C>
Value of the Borrower's and its
Subsidiaries' owned precious metal
holdings over the LIFO cost of such
holdings as set forth in the Borrower's
most recent consolidated financial
statements delivered pursuant to clause
(a) or clause (b) of Section 7.1.1 of
the Credit Agreement..................................... $_________
I. ADJUSTED CONSOLIDATED TANGIBLE NET WORTH:
The sum of Items 1.G and 1.H............................. $_________
</TABLE>
-2-
<PAGE> 41
ATTACHMENT 2
(to __/__/__ Compliance
Certificate)
LEVERAGE RATIO
(on ___________ __, 19__)
2. (1)LEVERAGE RATIO:
<TABLE>
<S> <C>
A. The aggregate outstanding principal
and stated amount of the
consolidated Indebtedness of the
Borrower and its Subsidiaries for
borrowed money and all other
obligations evidenced by bonds,
debentures, notes or other
similar instruments..................................... $_________
B. The aggregate outstanding principal
and stated amount of the
consolidated Indebtedness of the
Borrower and its Subsidiaries
(without duplication of the
obligations set forth in Item 2.A of
this Attachment 2), whether
contingent or otherwise, relative to
banker's acceptances issued for the
account of the Borrower and its
Subsidiaries ............................................$_________
C. The aggregate outstanding principal
and stated amount of the
consolidated Indebtedness of the
Borrower and its Subsidiaries as
lessee under leases which have been
or should be, in accordance with
GAAP, recorded as
Capitalized Lease Liabilities........................... $_________
D. Without duplication, Contingent
Liabilities of the Borrower and its
Subsidiaries in respect of any types
of Indebtedness described in
Items 2.A through 2.C .................................. $_________
E. Debt: The Sum of Items 2.A through 2.D................. $_________
</TABLE>
- --------
1 Computed in accordance with the final sentence contained in the
definition of "Indebtedness".
<PAGE> 42
<TABLE>
<S> <C>
F. Adjusted Consolidated Tangible
Net Worth (from Attachment 1, Item 1.I)................. $_________
G. LEVERAGE RATIO: The ratio
of Item 2.E to Item 2.F................................. ____:1.00
</TABLE>
-2-
<PAGE> 43
ATTACHMENT 3
(to __/__/__ Compliance
Certificate)
INTEREST COVERAGE RATIO
(on __/__/19__)
3. INTEREST COVERAGE RATIO:
<TABLE>
<S> <C>
*A. The consolidated net income of the
Borrower and its Subsidiaries
(excluding any extraordinary gains
and losses)........................................ $__________
*B. The aggregate amount of interest
expense of the Borrower and its
Subsidiaries, including the portion
of any rent paid on Capital Lease
Liabilities which is allocable to
interest expense in accordance with
GAAP and including fees or rents
arising from or relating to
consignment or leasing of precious
metals other than up-front fees paid
on the Effective Date to the Lenders
(provided, that any such interest
expense which is subject to a
Hedging Obligation will be
calculated on the net effect of any
payments made by the other party to
such Hedging Obligation)........................... $__________
*C. To the extent deducted in
determining Net Income,
provisions for income taxes........................ $__________
D. EBIT: The sum of Items 3.A
through 3.C........................................ $__________
E. Interest Expense: The amount set
forth in Item 3.B above minus the
effects of the nonrecurring, pre-
tax charges in an aggregate amount
not to exceed $9,500,000 relating to
the Borrower's discontinuance of its
karat gold fabricating product line
</TABLE>
- --------
* The amount which, in accordance with GAAP, would be included on the
consolidated financial statements of the Borrower and its Subsidiaries.
<PAGE> 44
<TABLE>
<S> <C>
in East Providence, Rhode Island and
additional costs primarily related
to that division's ongoing operation
in Fairfield, Connecticut.......................... $__________
F. INTEREST COVERAGE RATIO: The ratio
of Item 3.D to Item 3.E............................ ____:1.00
</TABLE>
-2-
<PAGE> 45
ATTACHMENT 4
(to __/__/__ Compliance
Certificate)
NET DEBT TO EBITDA RATIO
EBITDA TO INTEREST RATIO (on __/__/19__)
<TABLE>
<S> <C>
4. I. NET DEBT TO EBITDA RATIO:
A. Debt: Item 2.E from Attachment 2..................... $__________
B. The aggregate amount of cash and
Cash Equivalent Investments (not
subject to any Lien or other
encumbrance) owned by the Borrower
and its Subsidiaries on the last day
of the applicable Fiscal Quarter..................... $__________
C. Net Debt: Item 4.A minus Item 4.B................... $__________
*D. EBIT: Item 3.D from Attachment 3..................... $__________
*E. To the extent deducted in
determining Net Income,
provisions for depreciation of assets................ $__________
*F. To the extent deducted in
determining Net Income,
provisions for amortization.......................... $__________
G. EBITDA: The sum of Items 4.D
through 4.F.......................................... $__________
H. NET DEBT TO EBITDA RATIO: The ratio
of Item 4.C to Item 4.G.............................. ____:1.00
II. EBITDA TO INTEREST RATIO:
I. EBITDA: Item 4.G above.............................. $__________
J. Interest Expense: Item 3.E.......................... $__________
K. EBITDA TO INTEREST RATIO: The ratio of
Item 4.I to Item 4.J................................. ____:1.00
</TABLE>
- --------
* The amount which, in accordance with GAAP, would be included on the
consolidated financial statements of the Borrower and its Subsidiaries.
<PAGE> 46
ATTACHMENT 5
(to __/__/__ Compliance
Certificate)
DESIGNATED DEBT
(as of _________ __, 19__)
<TABLE>
<S> <C>
5. DESIGNATED DEBT:
A. Current Debt: The aggregate amount
of current maturities of the
consolidated Debt of the Borrower
and its Subsidiaries, determined in
accordance with GAAP................................ $_________
B. The sum of the aggregate outstanding
principal amount of all Loans plus
Letter of Credit Outstandings (as
such terms are defined in the Long
Term Credit Agreement).............................. $_________
C. The sum of Item 5.A and Item 5.B.................... $_________
D. 90% of the Market Value of the gold,
silver and platinum group metals and
the gold, silver and platinum group
metals' content of alloys then owned
by the Borrower and its Subsidiaries
in inventory and not held in
consignment......................................... $_________
E. 75% of the Eligible Receivables of
the Borrower and its Subsidiaries as
computed on Attachment 6 hereto..................... $_________
F. The aggregate amount of cash and
Cash Equivalent Investments of the
Borrower and its Subsidiaries, but
only to the extent that such cash
and Cash Equivalent Investments are
not subject to any Lien and (if held
or owned by a Subsidiary) are
transferable to the Borrower without
the consent or approval of any
other Person........................................ $_________
</TABLE>
<PAGE> 47
<TABLE>
<S> <C>
G. The sum of Items 5.D through 5.F.................... $_________
H. The excess of Item 5.C over Item 5.G................ $__________
</TABLE>
-2-
<PAGE> 48
ATTACHMENT 6
(to __/__/__ Compliance
Certificate)
ELIGIBLE RECEIVABLES
(as of _________ __, 19__)
<TABLE>
<S> <C>
6. ELIGIBLE RECEIVABLES:
A. Without duplication, the aggregate
amount of Receivables of the
Borrower and its Subsidiaries........................... $_________
B. The amount of such Receivables
lawfully owned by the Borrower or
such Subsidiary which is not free
and clear of Liens (other than Liens
permitted under Section 7.2.3 of the
Credit Agreement)....................................... $_________
C. The amount of such Receivables which
is not valid, binding and legally
enforceable obligations of the
obligor under such Receivable........................... $_________
D. The amount of such Receivables which
is subject to any dispute, setoff,
counterclaim or other claim or
defense on the part of the obligor
thereunder, or which is subject to
any obligor denying liability under
such Receivable in whole or in part..................... $_________
E. The amount of such Receivables which
is not a bona fide Receivable
arising from the sale (on an
absolute, and not a consignment,
approval, or sale-and-return-
basis (subject to the terms of
the parenthetical in clause (d) of
the definition of "Eligible Receivable"
contained in the Credit Agreement))..................... $_________
F. The amount of such Receivables which
is payable more than 90 days after
the shipping of goods giving rise to
such Receivable, or is more than
60 days past due........................................ $_________
G. The amount of such Receivables
which have been written off or
reserved against........................................ $_________
</TABLE>
<PAGE> 49
<TABLE>
<S> <C>
H. The amount of such Receivables which
is the obligation of an obligor that
is either an Affiliate of the
Borrower, or the subject of any
reorganization, bankruptcy,
receivership, custodianship,
insolvency or like proceeding or any
event of the nature set forth in
clauses (a) through (d) of Section
8.1.9 of the Credit Agreement........................... $_________
I. The sum of Items 6.B through 6.H........................ $_________
J. Item 6.A minus Item 6.I................................. $_________
K. 75% of the amount of the GO/DAN
Receivable.............................................. $_________
L. ELIGIBLE RECEIVABLES: Item 6.J plus
Item 6.K................................................ $_________
</TABLE>
-2-
<PAGE> 1
Exhibit (b)(4) [EXECUTION COPY]
THIRD AMENDMENT
TO
REVOLVING CREDIT AGREEMENT
This THIRD AMENDMENT TO REVOLVING CREDIT AGREEMENT, dated as of October
11, 1996 (this "Amendatory Agreement"), is among HANDY & HARMAN, a New York
corporation (the "Borrower"), certain financial institutions signatories hereto
(the "Lenders"), THE BANK OF NOVA SCOTIA, THE CHASE MANHATTAN BANK (formerly
known as Chemical Bank) and THE BANK OF NEW YORK, as the co-agents (collectively
referred to herein as the "Co-Agents"), and THE BANK OF NOVA SCOTIA, as
administrative agent (the "Administrative Agent").
W I T N E S S E T H:
WHEREAS, the Borrower, the Lenders, the Co-Agents and the
Administrative Agent are parties to a Revolving Credit Agreement, dated as of
September 28, 1994 (as amended or otherwise modified to the date hereof, the
"Existing Credit Agreement"); and
WHEREAS, the parties hereto have agreed, subject to the conditions and
terms hereinafter set forth, to amend the Existing Credit Agreement in certain
respects as herein provided (the Existing Credit Agreement, as so amended by
this Amendatory Agreement, being referred to as the "Credit Agreement");
NOW, THEREFORE, in consideration of the agreements herein contained,
the parties hereto agree as follows:
PART I
DEFINITIONS
SUBPART 1.1. Certain Definitions. The following terms (whether or not
underscored) when used in this Amendatory Agreement shall have the following
meanings (such meanings to be equally applicable to the singular and plural form
thereof):
"Administrative Agent" is defined in the preamble.
"Amendatory Agreement" is defined in the preamble.
"Borrower" is defined in the preamble.
"Co-Agents" is defined in the preamble.
"Credit Agreement" is defined in the second recital.
"Existing Credit Agreement" is defined in the first recital.
"Lenders" is defined in the preamble.
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"Third Amendment Effective Date" is defined in Subpart 3.1.
SUBPART 1.2. Other Definitions. Terms for which meanings are provided
in the Existing Credit Agreement are, unless otherwise defined herein or the
context otherwise requires, used in this Amendatory Agreement with such
meanings.
PART II
AMENDMENTS TO THE
EXISTING CREDIT AGREEMENT
Effective on (and subject to the occurrence of) the Third Amendment
Effective Date, the Existing Credit Agreement is hereby amended in accordance
with this Part II; except as so amended, the Existing Credit Agreement shall
continue in full force and
effect.
SUBPART 2.1. Amendments to Article I. Article I of the Existing Credit
Agreement is hereby amended in accordance with Subparts 2.1.1 through 2.1.2.
SUBPART 2.1.1. Section 1.1 of the Existing Credit Agreement is hereby
amended by inserting the following definitions in such Section in the
appropriate alphabetical sequence:
"1996 Transaction" means the sale of gold by the Borrower on
or before December 31, 1996 and certain other events, as more
specifically described in the letter, dated October 2, 1996, from the
Borrower to the Lenders, the Co-Agents and the Administrative Agent.
"Third Amendment" means the Third Amendment, dated as of
October 11, 1996, to this Agreement among the Borrower, the Lenders
party thereto, the Co-Agents and the Administrative Agent.
"Third Amendment Effective Date" means the Third
Amendment Effective Date as defined in Subpart 3.1 of the
Third Amendment.
SUBPART 2.1.2. Section 1.1 of the Existing Credit Agreement
is further amended by
(a) amending clause (b)(i) of the definition of "Consolidated
Tangible Net Worth" in its entirety to read as follows:
"(i) treasury stock (excluding the amount,
not to exceed $45,000,000, of cash consideration
expended for the
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repurchase and/or redemption of the Borrower's
outstanding common stock in accordance with the 1996
Transaction that results in an increase in such
treasury stock), subscribed but unissued stock,
unamortized debt discount and expense, good will,
trademarks, trade names, patents and other intangible
assets (but not deferred charges) of the Borrower,
and"; and
(b) the definition of "Designated Debt" is amended in
its entirety to read as follows:
"`Designated Debt' means the aggregate
amount of (i) Current Debt, and (ii) outstanding
Loans and Letter of Credit Outstandings; provided,
that from the Third Amendment Effective Date until
the first anniversary thereof, Designated Debt shall
exclude outstanding Loans and Letter of Credit
Outstandings and outstanding Loans under (and as
defined in) the Short Term Credit Agreement in up to
an aggregate maximum outstanding principal amount of
$64,500,000, as such amount is reduced Dollar for
Dollar by the amount of Debt not constituting
Designated Debt incurred during such period."
SUBPART 2.2. Amendments to Article II. Section 2.2.2 of the Existing
Credit Agreement is hereby amended in its entirety to read as follows:
"SECTION 2.2.2. Mandatory Reduction of Commitments.
Immediately upon the sale, lease, transfer, contribution or conveyance
of an asset pursuant to clause (c) of Section 7.2.11 (other than in
connection with the 1996 Transaction), the Loan Commitment Amount shall
be automatically reduced by an amount equal to the aggregate Net
Disposition Proceeds of such sale, lease, transfer, contribution or
conveyance."
SUBPART 2.3. Amendments to Article VII. Article VII of the Existing
Credit Agreement is hereby amended in accordance with Subpart 2.3.1.
SUBPART 2.3.1. Clauses (c) and (d) of Section 7.2.11 of the Existing
Credit Agreement are hereby amended by:
(a) amending clause (c) of such Section in its entirety
to read as follows:
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"(c) such sale, transfer, lease,
contribution or conveyance is (i) in connection with
the 1996 Transaction (provided, that the Market Value
of the gold sold or otherwise disposed of in
connection therewith shall not exceed an aggregate
amount equal to $45,000,000), or (ii) if not in the
ordinary course of business, or not otherwise
permitted hereunder, the assets are sold for fair
value (as determined by the Board of Directors of the
Borrower or the Subsidiary owning such assets) and
the Commitments of the Lenders are reduced by an
amount equal to the Net Disposition Proceeds of such
sale, transfer, lease, contribution or conveyance;
or"; and
(b) amending clause (d) of such Section by deleting the words
"Effective Date" wherever appearing therein and inserting the words
"Third Amendment Effective Date" in each case in place thereof.
SUBPART 2.4. Amendment to Exhibit E. Attachments 1 and 4 of Exhibit E
(Compliance Certificate) to the Existing Credit Agreement are hereby amended in
their entirety to read as set forth on Exhibit A hereto.
PART III
CONDITIONS TO EFFECTIVENESS
SUBPART 3.1. Third Amendment Effective Date. This Amendatory Agreement
shall become effective on the date first set forth above (the "Third Amendment
Effective Date") when each of the conditions set forth in this Subpart 3.1 shall
have been satisfied.
SUBPART 3.1.1. Execution of Counterparts. The Administrative Agent
shall have received counterparts of this Amendatory Agreement, duly executed on
behalf of the Borrower and the Required Lenders.
SUBPART 3.1.2. Short Term Credit Agreement Amendment No. 3. The
conditions to the effectiveness of the Third Amendment to the Short Term Credit
Agreement, also dated as of the date hereof ("ST Amendment No. 3") (other than
the effectiveness of this Amendatory Agreement) shall have been satisfied and
such ST Amendment No. 3 shall, concurrently with the effectiveness of
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this Amendatory Agreement, have been declared effective by the
Administrative Agent.
SUBPART 3.1.3. Legal Details, etc. All documents executed or submitted
pursuant hereto shall be satisfactory in form and substance to the
Administrative Agent and its counsel. The Administrative Agent and its counsel
shall have received all information and such counterpart originals or such
certified or other copies or such materials, as the Administrative Agent or its
counsel may reasonably request, and all legal matters incident to the
transactions contemplated by this Amendatory Agreement shall be satisfactory to
the Administrative Agent and its counsel.
PART IV
MISCELLANEOUS
SUBPART 4.1. Cross-References. References in this Amendatory Agreement
to any Part or Subpart are, unless otherwise specified or otherwise required by
the context, to such Part or Subpart of this Amendatory Agreement.
SUBPART 4.2. Loan Document Pursuant to Existing Credit Agreement. This
Amendatory Agreement is a Loan Document executed pursuant to the Existing Credit
Agreement and shall be construed, administered and applied in accordance with
all of the terms and provisions of the Existing Credit Agreement.
SUBPART 4.3. Successors and Assigns. This Amendatory Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
SUBPART 4.4. Counterparts. This Amendatory Agreement may be executed by
the parties hereto in several counterparts, each of which when executed and
delivered shall be deemed to be an original and all of which shall constitute
together but one and the same agreement.
SUBPART 4.5. Representations, No Default, etc. As of the date of
effectiveness of this Amendatory Agreement, the Borrower hereby represents and
warrants to the Agents and the Lenders that
(a) the representations and warranties set forth in Article VI
of the Existing Credit Agreement (excluding, however, those contained
in Section 6.7 thereof) are true and correct in all material respects
(unless stated to relate solely to an earlier date, in which case such
representations and warranties were true and correct as of such earlier
date);
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(b) except as disclosed by the Borrower to the
Administrative Agent and the Lenders pursuant to Section 6.7
of the Existing Credit Agreement,
(i) no litigation, arbitration or governmental
investigation or proceeding is pending or, to the knowledge of
the Borrower, threatened against the Borrower or any of its
Subsidiaries which may reasonably be expected to materially
adversely affect the Borrower's, or the Borrower and its
Subsidiaries' taken as a whole, financial condition,
operations, assets, businesses, properties or prospects or
which purports to affect the legality, validity or
enforceability of the Existing Credit Agreement, the Notes or
any other Loan Document; and
(ii) no development has occurred in any litigation,
arbitration or governmental investigation or proceeding
disclosed pursuant to Section 6.7 of the Existing Credit
Agreement which may reasonably be expected to materially
adversely affect the financial condition, operations, assets,
businesses, properties or prospects of the Borrower or the
Borrower and its Subsidiaries, taken as a whole; and
(c) no Default has occurred and is continuing.
SUBPART 4.6. Limited Waiver, etc. No amendment, waiver or approval by
the Agents or any Lender under this Amendatory Agreement shall, except as may be
otherwise stated in this Amendatory Agreement, be applicable to subsequent
transactions. No amendment, waiver or approval hereunder shall require any
similar or dissimilar amendment, waiver or approval to be granted after the date
hereof, and except as expressly modified by this Amendatory Agreement, the
provisions of the Existing Credit Agreement shall remain in full force and
effect, without amendment or other modification.
SUBPART 4.7. Governing Law. THIS AMENDATORY AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendatory
Agreement to be executed by their respective authorized officers as of the day
and year first above written.
HANDY & HARMAN
By______________________________________
Title:
THE BANK OF NOVA SCOTIA,
in its capacity as Administrative
Agent, Co-Agent and Lender
By______________________________________
Title:
THE BANK OF NEW YORK,
in its capacity as
Co-Agent and Lender
By______________________________________
Title:
THE CHASE MANHATTAN BANK (formerly known
as Chemical Bank), in its capacity as
Co-Agent and Lender
By______________________________________
Title:
FLEET PRECIOUS METALS INC.
By______________________________________
Title:
THE FIRST NATIONAL BANK OF CHICAGO
(formerly known as NBD Bank)
By______________________________________
Title:
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BANK OF TOKYO - MITSUBISHI TRUST COMPANY
By______________________________________
Title:
LTCB TRUST COMPANY
By______________________________________
Title:
CREDIT LYONNAIS NEW YORK BRANCH
By______________________________________
Title:
CREDIT LYONNAIS CAYMAN ISLAND BRANCH
By______________________________________
Title:
THE SUMITOMO BANK, LIMITED
By______________________________________
Title:
By______________________________________
Title:
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THE FUJI BANK, LIMITED,
NEW YORK BRANCH
By______________________________________
Title:
ABN AMRO BANK N.V. NEW YORK BRANCH
By______________________________________
Title:
By______________________________________
Title:
COMERICA BANK
By______________________________________
Title:
YASUDA TRUST & BANKING CO., LTD.
NEW YORK BRANCH
By______________________________________
Title:
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EXHIBIT A
TO THIRD AMENDMENT
ATTACHMENT 1
(to __/__/__ Compliance Certificate)
ADJUSTED CONSOLIDATED TANGIBLE NET WORTH
(________ __, 19__)
ADJUSTED CONSOLIDATED
TANGIBLE NET WORTH:
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A. The par value (or value stated on
the books of the Borrower) of the
capital stock of all classes of the
Borrower.......................................................... $_________
B. The amount of the consolidated
surplus, whether capital or earned,
of the Borrower and its
and its Subsidiaries............................................... $_________
C. The sum (or difference, in the
case of a surplus deficit in
Item 1.B) of Items 1.A and 1.B..................................... $_________
D. The aggregate amount of treasury
stock (excluding the amount, not to
exceed $45,000,000, of cash
consideration expended for the
repurchase and/or redemption of the
of the Borrower's outstanding
common stock in accordance with the
1996 Transaction), subscribed but
unissued stock, unamortized debt
discount and expense, good will,
trademarks, trade names, patents
and other intangible assets (but
not deferred charges) of the
Borrower and its Subsidiaries..................................... $_________
E. The aggregate amount of all write-
ups in the book value of any assets
owned by the Borrower or its
Subsidiaries subsequent to March
16, 1992, other than write-ups of
assets (and assets of Subsidiaries)
acquired by the Borrower and/or its
Subsidiaries (exclusive of
goodwill) that are made in
connection with the
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acquisition thereof............................................... $_________
F. Sum of Items 1.D through 1.E...................................... $_________
G. CONSOLIDATED TANGIBLE NET WORTH:
The excess of Item 1.C over Item 1.F............................... $_________
H. 40% of the excess of the Market
Value of the Borrower's and its
Subsidiaries' owned precious metal
holdings over the LIFO cost of such
holdings as set forth in the
Borrower's most recent consolidated
financial statements delivered
pursuant to clause (a) or clause
(b) of Section 7.1.1 of the
Credit Agreement.................................................. $_________
I. ADJUSTED CONSOLIDATED TANGIBLE NET WORTH:
The sum of Items 1.G and 1.H...................................... $_________
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ATTACHMENT 4
(to __/__/__ Compliance
Certificate)
DESIGNATED DEBT
(as of _________ __, 19__)
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DESIGNATED DEBT:
A. Current Debt: The aggregate amount
of current maturities of the
consolidated Debt of the Borrower
and its Subsidiaries, determined in
accordance with GAAP.......................................... $_________
B. The sum of the aggregate
outstanding principal amount of all
Loans plus Letter of Credit
Outstandings (as such terms are
defined in the Long Term
Credit Agreement)............................................. $_________
C. The sum of Item 4.A and Item 4.B
(excluding, from the Third
Amendment Effective Date until the
first anniversary thereof, Loans
and Letter of Credit Outstandings
and Loans under (and as defined in)
the Short Term Credit Agreement in
up to a maximum principal amount of
$64,500,000, as such amount is
reduced Dollar for Dollar by the
amount of Debt not constituting
Designated Debt incurred
during such period)........................................... $_________
D. 90% of the Market Value of the
gold, silver and platinum group
metals and the gold, silver and
platinum group metals' content of
alloys then owned by the Borrower
and its Subsidiaries in inventory
and not held in consignment................................... $_________
E. 75% of the Eligible Receivables of
the Borrower and its Subsidiaries
as computed on Attachment 5 hereto............................ $_________
F. The aggregate amount of cash and
Cash Equivalent Investments of the
Borrower and its Subsidiaries, but
only to the extent that such cash
and Cash Equivalent Investments are
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not subject to any Lien and (if
held or owned by a Subsidiary) are
transferable to the Borrower
without the consent or approval of
any other Person.............................................. $_________
G. The sum of Items 4.D through 4.F.............................. $_________
H. The excess of Item 4.C over Item 4.G.......................... $_________
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