SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 14D-1
TENDER OFFER STATEMENT PURSUANT TO SECTION 14(d)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
AND
SCHEDULE 13D
(AMENDMENT NO. 3)
UNDER THE SECURITIES EXCHANGE ACT OF 1934
-------------------------------
HANDY & HARMAN
(Name of Subject Company)
WHX CORPORATION
HN ACQUISITION CORP.
(Bidders)
COMMON STOCK, PAR VALUE $1.00 PER SHARE
(INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS)
(Title of Class of Securities)
410306 10 4
(CUSIP Number of Class of Securities)
MR. RONALD LABOW
CHAIRMAN OF THE BOARD
WHX CORPORATION
110 EAST 59TH STREET
NEW YORK, NY 10022
TELEPHONE: (212) 355-5200
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications on Behalf of Bidder)
with copies to:
ILAN K. REICH, ESQ.
STEVEN WOLOSKY, ESQ.
OLSHAN GRUNDMAN FROME & ROSENZWEIG LLP
505 PARK AVENUE
NEW YORK, NEW YORK 10022
TELEPHONE: (212) 753-7200
-------------------------------
CALCULATION OF FILING FEE
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TRANSACTION VALUATION* AMOUNT OF FILING FEE**
$369,519,863.25 $73,903.97
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* For purposes of calculating the filing fee only. This calculation
assumes the purchase of all of the 10,482,833 shares of Common Stock,
par value $1.00 per share (the "Shares") (and the associated Common
Stock Purchase Rights (the "Rights")) of the subject company at a price
of $35.25 per Share (and Right), net to the seller in cash, without
interest thereon.
** The amount of the filing fee, calculated in accordance with Rule
0-11(d) of the Securities Exchange Act of 1934, as amended, equals
1/50th of one percent of the aggregate value of cash offered by the
bidders.
<PAGE>
[ ] Check box if any part of the fee is offset as provided by Rule
0-11(a)(2) and identify the filing with which the offsetting fee was
previously paid. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
Amount Previously Paid: Not applicable
Form or Registration No.: Not applicable
Filing Party: Not applicable
Date Filed: Not applicable
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<PAGE>
CUSIP NO. 268039 10 4 PAGE 1 OF 3
14D-1
1. NAMES OF REPORTING PERSONS
WHX CORPORATION
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
WC
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(e) or 2(f) [ ]
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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7. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
1,649,455
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8. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW
(7) EXCLUDES CERTAIN SHARES
[ ]
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9. PERCENT OF CLASS REPRESENTED BY AMOUNT IN
ROW (7)
13.6%
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10. TYPE OF REPORTING PERSON
HC and CO
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<PAGE>
CUSIP NO. 268039 10 4 PAGE 2 OF 3
14D-1
1. NAMES OF REPORTING PERSONS
WHEELING-PITTSBURGH CAPITAL CORPORATION
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
AF
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS
IS REQUIRED PURSUANT TO ITEMS 2(e) or 2(f) [ ]
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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7. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
1,649,455 Common Shares
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8. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7)
EXCLUDES CERTAIN SHARES [ ]
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9. PERCENT OF CLASS REPRESENTED BY AMOUNT
IN ROW (7)
13.6%
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10. TYPE OF REPORTING PERSON
CO
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-4-
<PAGE>
CUSIP NO. 268039 10 4 PAGE 3 OF 3
14D-1
1. NAMES OF REPORTING PERSONS
HN ACQUISITION CORP.
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
00
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS
IS REQUIRED PURSUANT TO ITEMS 2(e) or 2(f) [ ]
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
New York
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7. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON
-0-
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8. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7)
EXCLUDES CERTAIN SHARES [ ]
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9. PERCENT OF CLASS REPRESENTED BY AMOUNT
IN ROW (7)
-0-
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10. TYPE OF REPORTING PERSON
CO
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-5-
<PAGE>
ITEM 1. SECURITY AND SUBJECT COMPANY.
(a) The name of the subject company is Handy & Harman, a New York
corporation (the "Company"). The address of the Company's principal executive
offices is 250 Park Avenue, New York, New York 10177.
(b) This Tender Offer Statement on Schedule 14D-1 relates to the offer
by HN Acquisition Corp. (the "Purchaser"), a New York corporation and a wholly
owned subsidiary of WHX Corporation, a Delaware corporation (the "Parent"), to
purchase all outstanding shares of Common Stock, par value $1.00 per share (the
"Shares"), of the Company, including the associated Common Stock Purchase Rights
issued pursuant to the Rights Agreement, dated as of January 26, 1989, as
amended on April 25, 1996, October 22, 1996 and March 1, 1998 (as so amended,
the "Rights Agreement"), between the Company and ChaseMellon Shareholder
Services L.L.C., as Rights Agent, at a price of $35.25 per Share, net to the
seller in cash, without interest thereon, upon the terms and subject to the
conditions set forth in the Offer to Purchase, dated March 6, 1998 (the "Offer
to Purchase"), and in the related Letter of Transmittal (which, together with
any amendments or supplements thereto, constitute the "Offer"). The information
set forth under "Introduction" in the Offer to Purchase annexed hereto as
Exhibit (a)(1) is incorporated herein by reference.
(c) The information set forth in Section 6 "Price Range of Shares;
Dividends" in the Offer to Purchase is incorporated herein by reference.
ITEM 2. IDENTITY AND BACKGROUND.
(a)-(d); (f)-(g) This Statement is being filed by the Purchaser and the
Parent. The information set forth in the Offer to Purchase under "Introduction,"
in Section 9 "Certain Information Concerning the Purchaser and the Parent" and
in Schedule I is incorporated herein by reference.
(e) During the last five years, neither the Purchaser, the Parent nor
any persons controlling the Purchaser, nor, to the best knowledge of the
Purchaser or the Parent, any of the persons listed on Schedule I to the Offer to
Purchase has been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors).
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY.
(a)-(b) The information set forth under "Introduction," in Section 8
"Certain Information Concerning the Company," in Section 9 "Certain Information
Concerning the Purchaser and the Parent," in Section 11 "Background of the
Offer; Contacts with the Company," and in Section 12 "Purpose of the Offer;
Merger Agreement; Plans for the Company" in the Offer to Purchase is
incorporated herein by reference.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a)-(b) The information set forth under "Introduction" and in Section
10 "Source and Amount of Funds" in the Offer to Purchase is incorporated herein
by reference.
(c) Not applicable.
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER.
(a)-(d) The information set forth under "Introduction," and in Section
12 "Purpose of the Offer; Merger Agreement; Plans for the Company" in the Offer
to Purchase is incorporated herein by reference.
(e)-(g) The information set forth in Section 12 "Purpose of the Offer;
Merger Agreement; Plans for the Company" and in Section 7 "Effect on the Market
for the Shares, Stock Exchange Listing and Exchange Act Registration" in the
Offer to Purchase is incorporated herein by reference.
-6-
<PAGE>
ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.
(a)-(b) The information set forth under "Introduction," in Section 9
"Certain Information Concerning the Purchaser and the Parent," in Section 12
"Purpose of the Offer; Merger Agreement; Plans for the Company" and in Schedule
II is incorporated herein by reference.
ITEM 7. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO
THE SUBJECT COMPANY'S SECURITIES.
The information set forth in Section 10 "Source and Amount of Funds,"
in Section 11 "Background of the Offer; Contacts with the Company" and in
Section 12 "Purpose of the Offer; Merger Agreement; Plans for the Company" in
the Offer to Purchase is incorporated herein by reference.
ITEM 8. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.
The information set forth in Section 16 "Fees and Expenses" in the
Offer to Purchase is incorporated herein by reference.
ITEM 9. FINANCIAL STATEMENTS OF CERTAIN BIDDERS.
The information set forth in Section 9 "Certain Information Concerning
the Purchaser and the Parent" in the Offer to Purchase is incorporated herein by
reference.
The incorporation by reference herein of the above referenced financial
information does not constitute an admission that such information is material
to a decision by a shareholder of the Company whether to sell, tender or hold
Shares being sought in the Offer.
ITEM 10. ADDITIONAL INFORMATION.
(a) The information set forth in Section 12 "Purpose of the Offer;
Merger Agreement; Plans for the Company" in the Offer to Purchase is
incorporated herein by reference.
(b)-(c) The information set forth under "Introduction" and in Section
15 "Certain Legal Matters and Regulatory Approvals" in the Offer to Purchase is
incorporated herein by reference.
(d)-(e) Not applicable.
(f) The information set forth in the Offer to Purchase and the Letter
of Transmittal, copies of which are attached hereto as Exhibits (a)(1) and
(a)(2), respectively, is incorporated herein by reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
(a) (1) Offer to Purchase, dated March 6, 1998.
(2) Letter of Transmittal.
(3) Notice of Guaranteed Delivery.
(4) Letter to Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees.
(5) Letter to Clients for use by Brokers, Dealers,
Commercial Banks, Trust Companies and Other Nominees.
(6) Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9.
(7) Form of Press Release dated March 6, 1998.
(8) Summary Advertisement published in the Wall Street
Journal on March 6, 1998.
(b) Not applicable.
-7-
<PAGE>
(c) Agreement and Plan of Merger, dated as of March 1, 1998, by
and among the Parent, the Purchaser and the Company
(incorporated by reference to Amendment No. 2 to the Schedule
13D of Parent filed on March 3, 1998).
(d) Not applicable.
(e) Not applicable.
(f) Not applicable.
-8-
<PAGE>
SIGNATURE
After due inquiry and to the best of its knowledge and belief, the
undersigned certifies that the information set forth in this statement is true,
complete and correct.
Dated: March 6, 1998
WHX CORPORATION
By: /s/ Stewart E. Tabin
--------------------------------
Name: Stewart E. Tabin
Title: Assistant Treasurer
HN ACQUISITION CORP.
By: /s/ Stewart E. Tabin
-------------------------------
Name: Stewart E. Tabin
Title: Vice President
-9-
<PAGE>
EXHIBIT INDEX
EXHIBIT
NUMBER
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(a) (1) Offer to Purchase, dated March 6, 1998.
(2) Letter of Transmittal.
(3) Notice of Guaranteed Delivery.
(4) Letter to Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees.
(5) Letter to Clients for use by Brokers, Dealers,
Commercial Banks, Trust Companies and Other Nominees.
(6) Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9.
(7) Form of Press Release dated March 6, 1998.
(8) Summary Advertisement published in the Wall Street
Journal on March 6, 1998.
(b) Not applicable.
(c) Agreement and Plan of Merger, dated as of March 1, 1998, by
and among the Parent, the Purchaser and the Company
(incorporated by reference to Amendment No. 2 to the Schedule
13D of Parent filed on March 3, 1998).
(d) Not applicable.
(e) Not applicable.
(f) Not applicable.
-10-
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS)
OF
HANDY & HARMAN
AT
$35.25 PER SHARE
BY
HN ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
WHX CORPORATION
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THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00
MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY, APRIL 2, 1998,
UNLESS THE OFFER IS EXTENDED.
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THE BOARD OF DIRECTORS OF HANDY & HARMAN (THE "COMPANY") HAS DETERMINED
THAT THE OFFER AND THE MERGER ARE FAIR TO AND IN THE BEST INTERESTS OF THE
COMPANY AND ITS SHAREHOLDERS, HAS APPROVED THE MERGER AGREEMENT AND THE
TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING THE OFFER, AND RECOMMENDS THAT
HOLDERS OF SHARES OF COMMON STOCK OF THE COMPANY (THE "SHARES") ACCEPT THE OFFER
AND TENDER THEIR SHARES PURSUANT TO THE OFFER. SEE ITEM 4 OF THE SCHEDULE 14D-9
MAILED TO SHAREHOLDERS SIMULTANEOUSLY WITH THIS OFFER TO PURCHASE.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER THAT NUMBER OF
SHARES WHICH, TOGETHER WITH THE SHARES THEN OWNED BY THE PARENT, THE PURCHASER,
OR THE PARENT'S OTHER WHOLLY OWNED SUBSIDIARIES, WOULD REPRESENT AT LEAST A
MAJORITY OF ALL OUTSTANDING SHARES ON A FULLY DILUTED BASIS ON THE DATE OF
PURCHASE (THE "MINIMUM CONDITION"). SEE INTRODUCTION AND SECTION 14.
IMPORTANT
Any shareholder desiring to tender all or any portion of such
shareholder's Shares (as defined herein) should either (i) complete and sign the
Letter of Transmittal (or a facsimile thereof) in accordance with the
instructions in the Letter of Transmittal, have such shareholder's signature
thereon guaranteed if required by Instruction 1 to the Letter of Transmittal,
mail or deliver the Letter of Transmittal (or such facsimile thereof) and any
other required documents to the Depositary (as defined herein) and either
deliver the certificates for such Shares to the Depositary along with the Letter
of Transmittal (or a facsimile thereof) or deliver such Shares pursuant to the
procedure for book-entry transfer set forth in Section 3 prior to the expiration
of the Offer or (ii) request such shareholder's broker, dealer, commercial bank,
trust company or other nominee to effect the transaction for such shareholder. A
shareholder having Shares registered in the name of a broker, dealer, commercial
bank, trust company or other nominee must contact such person if he or she
desires to tender such Shares.
Any shareholder who desires to tender Shares and whose certificates for
such Shares are not immediately available, or who cannot comply with the
procedures for book-entry transfer described in this Offer to Purchase on a
timely basis, may tender such Shares by following the procedures for guaranteed
delivery set forth in Section 3.
Questions and requests for assistance or for additional copies of this
Offer to Purchase, the Letter of Transmittal or other tender offer materials may
be directed to the Information Agent or the Dealer Manager at their respective
addresses and telephone numbers set forth on the back cover of this Offer to
Purchase.
The Dealer Manager for the Offer is:
DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION
March 6, 1998
<PAGE>
TABLE OF CONTENTS
PAGE
----
INTRODUCTION.................................................................1
1. Terms of the Offer; Expiration Date.................................3
2. Acceptance for Payment and Payment for Shares.......................4
3. Procedures for Tendering Shares.....................................5
4. Withdrawal Rights...................................................8
5. Certain Federal Income Tax Consequences.............................9
6. Price Range of Shares; Dividends...................................10
7. Effect of the Offer on the Market for the Shares,
Stock Exchange Listing and Exchange Act Registration...............10
8. Certain Information Concerning the Company.........................11
9. Certain Information Concerning the Purchaser and the Parent........14
10. Source and Amount of Funds.........................................17
11. Background of the Offer; Contacts with the Company.................18
12. Purpose of the Offer; Merger Agreement; Plans for the Company......19
13. Dividends and Distributions........................................26
14. Conditions of the Offer............................................27
15. Certain Legal Matters and Regulatory Approvals.....................28
16. Fees and Expenses..................................................29
17. Miscellaneous......................................................30
Schedule I -- Information Concerning the Directors
and Executive Officers of the Parent and the Purchaser..................32
Schedule II -- Transactions in the Securities of the Company................36
-i-
<PAGE>
To the Holders of Common Stock of Handy & Harman:
INTRODUCTION
HN Acquisition Corp. (the "Purchaser") hereby offers to purchase all
outstanding shares of Common Stock, par value $1.00 per share (the "Shares), of
Handy & Harman, a New York corporation, including the associated Common Stock
Purchase Rights (the "Rights") issued pursuant to the Rights Agreement, dated as
of January 26, 1989, as amended on April 25, 1996, October 22, 1996 and March 1,
1998 (as so amended, the "Rights Agreement"), between the Company and
ChaseMellon Shareholder Services L.L.C., as Rights Agent (the "Rights Agent"),
at a price of $35.25 per Share, net to the seller in cash, without interest
thereon (the "Offer Price"), upon the terms and subject to the conditions set
forth in this Offer to Purchase and in the related Letter of Transmittal (which,
as amended from time to time, together constitute the "Offer"). The Purchaser is
a New York corporation and a wholly owned subsidiary of WHX Corporation, a
Delaware corporation (the "Parent"). Unless the context otherwise requires, all
references to Shares include the associated Rights and all references to the
Rights include the benefits that may inure to holders of the Rights pursuant to
the Rights Agreement, including the right to receive any payment due upon
redemption of the Rights. Based on publicly available information, the Purchaser
believes that one Right is currently associated with each Share.
Tendering shareholders will not be obligated to pay brokerage fees or
commissions or, except as set forth in Instruction 6 of the Letter of
Transmittal, stock transfer taxes upon the purchase of Shares by the Purchaser
pursuant to the Offer. The Purchaser will pay all charges and expenses of
Donaldson, Lufkin & Jenrette Securities Corporation (the "Dealer Manager"),
Harris Trust Company of New York, as depositary (the "Depositary"), and
Innisfree M&A Incorporated, as information agent (the "Information Agent"),
incurred in connection with the Offer.
See Section 16.
The purpose of the Offer and the Merger (as defined herein) is for the
Parent to acquire control of, and the entire equity interest in, the Company.
For a discussion of certain appraisal rights that will be available to
shareholders upon consummation of the Merger, see Section 12.
THE BOARD OF DIRECTORS OF THE COMPANY (THE "COMPANY BOARD") HAS
DETERMINED THAT THE OFFER AND THE MERGER ARE FAIR TO AND IN THE BEST INTERESTS
OF THE COMPANY AND ITS SHAREHOLDERS AND RECOMMENDS THAT SHAREHOLDERS ACCEPT THE
OFFER AND TENDER THEIR SHARES IN THE OFFER. The Company has informed the
Purchaser and the Parent that the reasons underlying such determinations are as
described in Item 4 of the Schedule 14D-9 mailed to shareholders simultaneously
with this Offer to Purchase (the "Schedule 14D-9"). Goldman Sachs & Co., the
Company's financial advisor ("Goldman Sachs"), has delivered to the Company its
opinion (the "Goldman Fairness Opinion") that as of March 1, 1998, the
consideration to be received by the shareholders (excluding WHX and its
subsidiaries) pursuant to the Offer and the Merger was fair from a financial
point of view to such shareholders. A copy of the Goldman Fairness Opinion,
which sets forth a description of the assumptions made, matters considered and
limitations on the review undertaken in connection with the opinion, is included
as an exhibit to the Schedule 14D-9.
The Offer is conditioned upon, among other things, there being validly
tendered and not withdrawn prior to the expiration of the Offer that number of
Shares which, together with the Shares then owned by the Parent, the Purchaser,
and other wholly owned subsidiaries of the Parent, would represent at least a
majority of all outstanding shares on a fully diluted basis on the date of
purchase (the "Minimum Condition"). See Sections 1 and 14.
The Offer is being made pursuant to an Agreement and Plan of Merger,
dated as of March 1, 1998 (the "Merger Agreement"), by and among the Company,
the Parent and the Purchaser. The Merger Agreement provides, among other things,
for the commencement of the Offer by the Purchaser and further provides that,
after the purchase of Shares pursuant to the Offer, subject to the satisfaction
or waiver of certain conditions, the Purchaser will be merged with and into the
Company (the "Merger"), with the Company surviving the Merger (the "Surviving
Corporation") as a wholly owned subsidiary of the Parent. Pursuant to the
Merger, each outstanding Share (other
<PAGE>
than Shares owned by the Company as treasury stock, owned by the Parent or any
subsidiary of the Parent, or Shares held by shareholders exercising appraisal
rights under New York law) will be converted into a right to receive $35.25 in
cash, without interest (the "Merger Consideration"). See Section 12.
The consummation of the Merger is subject to the satisfaction or waiver
of a number of conditions, including the adoption of the Merger Agreement by the
requisite vote or consent of the shareholders. Under the New York Business
Corporation Law (the "NYBCL"), the shareholder vote necessary to adopt the
Merger Agreement (the "Company Shareholder Vote") is the affirmative vote of at
least two-thirds of the Shares, including Shares held by the Purchaser and its
affiliates. See Section 12.
The Rights Agreement has been amended to provide that (i) neither the
Parent nor any of its affiliates or associates will be deemed an Acquiring
Person, and (ii) neither a Distribution Date, a Triggering Event, nor a Stock
Acquisition Date (as such terms are defined in the Company Rights Agreement)
will occur, in either case, by reason of the execution of the Merger Agreement,
the announcement or completion of the Offer, the consummation of the Merger or
the consummation of the other transactions contemplated by the Merger Agreement.
Shareholders are required to tender one Right for each Share tendered in order
to effect a valid tender of such Share. If the Distribution Date does not occur
prior to the Expiration Date, a tender of Shares will automatically constitute a
tender of the associated Rights. See Section 3.
The foregoing summary of the Rights Agreement does not purport to be
complete and is qualified in its entirety by reference to the Form 8-A relating
to the Rights, the text of the Rights Agreement, filed as an exhibit thereto
with the Securities and Exchange Commission (the "SEC") and subsequent
amendments to the Form 8-A and the Rights Agreement as filed with the SEC.
Copies of these documents may be obtained in the manner set forth in Section 8
below.
INFORMATION APPEARING OR INCORPORATED HEREIN IN RESPECT OF THE COMPANY,
THE COMPANY BOARD AND THE GOLDMAN FAIRNESS OPINION HAS BEEN FURNISHED TO THE
PURCHASER AND THE PARENT BY THE COMPANY. WHILE THE PURCHASER AND THE PARENT HAVE
NO REASON, AS OF THE DATE OF THIS OFFER TO PURCHASE, TO BELIEVE THAT SUCH
INFORMATION IS INCORRECT IN ANY MATERIAL RESPECT, NONE OF THE PURCHASER, THE
PARENT, THEIR RESPECTIVE AFFILIATES OR ANY REPRESENTATIVE OF ANY OF THE
FOREGOING ASSUMES ANY LIABILITY THEREFOR.
THE OFFER DOES NOT CONSTITUTE A SOLICITATION OF PROXIES FOR ANY MEETING
OF SHAREHOLDERS. ANY SUCH SOLICITATION WILL BE MADE ONLY PURSUANT TO SEPARATE
PROXY MATERIALS PURSUANT TO THE REQUIREMENTS OF SECTION 14(A) OF THE SECURITIES
AND EXCHANGE ACT OF 1934, AS AMENDED (THE "EXCHANGE ACT").
THIS OFFER TO PURCHASE, THE LETTER OF TRANSMITTAL AND THE SCHEDULE
14D-9 CONTAIN IMPORTANT INFORMATION WHICH SHOULD BE READ CAREFULLY BY
SHAREHOLDERS BEFORE ANY DECISION IS MADE WITH RESPECT TO THE OFFER.
-2-
<PAGE>
-----------------------
1. TERMS OF THE OFFER; EXPIRATION DATE.
Upon the terms and subject to the conditions of the Offer (including,
if the Offer is extended or amended, the terms and conditions of any extension
or amendment), the Purchaser will accept for payment and pay for all Shares
which are validly tendered prior to the Expiration Date and not properly
withdrawn in accordance with Section 4. The term "Expiration Date" means 12:00
Midnight, New York City time, on Thursday, April 2, 1998, unless and until the
Purchaser 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 Purchaser, will expire.
Pursuant to the Merger Agreement the Purchaser has agreed that it will
not, without the consent of the Company, extend the Offer, except that, without
the consent of the Company, if on the initial Expiration Date all conditions to
the Offer shall not have been satisfied or waived, the Parent has agreed to
cause the Purchaser to extend the expiration date of the Offer from time to time
up to May 1, 1998. The Merger Agreement provides that the Purchaser shall, on
the terms and subject to the prior satisfaction or waiver of the conditions of
the Offer, accept for payment and pay for Shares tendered as soon as it is
legally permitted to do so under applicable law; provided, however, the
Purchaser may in its sole discretion extend the Offer for a period not to exceed
10 business days after the initial Expiration Date. In addition, the Merger
Agreement provides that, without the consent of the Company, the Offer Price may
be increased and the Offer may be extended to the extent required by law in
connection with such an increase in the Offer Price. As used in this Offer to
Purchase, "business day" has the meaning set forth in Rule 14d-1 under the
Exchange Act.
In addition, the Purchaser has agreed in the Merger Agreement that it
will not, without the consent of the Company, decrease the Offer Price, decrease
the number of Shares sought in the Offer, amend or waive the Minimum Condition,
or amend any condition of the Offer in a manner adverse to the holders of Shares
(other than with respect to insignificant changes or amendments).
Subject to the terms of the Merger Agreement and the applicable rules
and regulations of the SEC, the Purchaser reserves the right (but shall not be
obligated), at any time and from time to time, and regardless of whether or not
any of the events or facts set forth in Section 14 hereof shall have occurred,
(i) to extend the period of time during which the Offer is open, and thereby
delay acceptance for payment of and the payment for any Shares, by giving oral
or written notice of such extension to the Depositary and (ii) to amend the
Offer in any other respect by giving oral or written notice of such amendment to
the Depositary. Under no circumstances will interest be paid on the purchase
price for tendered Shares, whether or not the Purchaser exercises its right to
extend the Offer.
If by 12:00 midnight, New York City time, on Thursday, April 2, 1998
(or any date or time then set as the Expiration Date), any or all of the
conditions to the Offer have not been satisfied or waived, the Purchaser
reserves the right (but shall not be obligated), subject to the terms and
conditions contained in the Merger Agreement and to the applicable rules and
regulations of the SEC, (i) to terminate the Offer and not accept for payment or
pay for any Shares and return all tendered Shares to tendering shareholders,
(ii) to waive all the unsatisfied conditions and accept for payment and pay for
all Shares validly tendered prior to the Expiration Date and not theretofore
withdrawn, (iii) to extend the Offer subject to the right of shareholders to
withdraw Shares until the Expiration Date, or (iv) to amend the Offer. The
rights reserved by the Purchaser in this paragraph are in addition to the
Purchaser's rights to terminate the Offer pursuant to Section 14. During any
such extension, all Shares previously tendered and not properly withdrawn will
remain subject to the Offer, subject to the rights of a tendering shareholder to
withdraw Shares in accordance with the procedures set forth in Section 4.
The Purchaser acknowledges that (i) Rule 14e-1(c) under the Exchange
Act requires the Purchaser to pay the consideration offered or return the Shares
tendered promptly after the expiration, termination or withdrawal of
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<PAGE>
the Offer, and (ii) the Purchaser may not delay acceptance for payment of, or
payment for (except as provided above), any Shares upon the occurrence of any of
the conditions specified in Section 14 without extending the period of time
during which the Offer is open.
Any such extension, delay, termination, waiver or amendment will be
followed as promptly as practicable by public announcement thereof, with such
announcement in the case of an extension to be made no later than 9:00 a.m., New
York City time, on the next business day after the previously scheduled
Expiration Date. Subject to applicable law (including Rules 14d-4(c), 14d-6(d)
and 14e-1 under the Exchange Act, which require that material changes be
promptly disseminated to shareholders in a manner reasonably designed to inform
them of such changes) and without limiting the manner in which the Purchaser may
choose to make any public announcement, the Purchaser shall have no obligation
to publish, advertise or otherwise communicate any such public announcement
other than by issuing a press release to the Dow Jones News Service.
If the Purchaser makes a material change in the terms of the Offer or
the information concerning the Offer, or if it waives a material condition of
the Offer, the Purchaser will disseminate additional tender offer materials and
extend the Offer to the extent required by Rules 14d-4(c), 14d-6(d) and 14e-1
under the Exchange Act. The minimum period during which the Offer must remain
open following material changes in the terms of the Offer or information
concerning the Offer, other than a change in price or a change in percentage of
securities sought, will depend upon the facts and circumstances, including the
relative materiality of the changed terms or information. The SEC has taken the
position that an offer should generally remain open for a minimum of five
business days from the date a material change is first published, sent or given
to shareholders. With respect to a change in price or a change in percentage of
securities sought (other than an increase in the number of Shares sought not in
excess of 2% of the outstanding Shares), a minimum ten business day period is
required to allow for adequate dissemination to shareholders and investor
response. Accordingly, if prior to the Expiration Date, the Purchaser increases
or decreases the consideration offered pursuant to the Offer, and if the Offer
is scheduled to expire at any time earlier than the period ending on the tenth
business day from the date that notice of such increase or decrease is first
published, sent or given to holders of Shares, the Offer will be extended at
least until the expiration of such ten business day period.
As of the date of this Offer to Purchase, the Rights are evidenced by
the certificates representing the Shares and do not trade separately.
Accordingly, by tendering a certificate representing the Shares, a shareholder
is automatically tendering a similar number of associated Rights. If, however,
pursuant to the Rights Agreement or for any other reason, the Rights detach and
separate certificates are issued, shareholders will be required to tender one
Right for each Share tendered in order to effect a valid tender of such Share.
The Company has provided to the Purchaser its list of shareholders and
security position listings for the purpose of disseminating the Offer to holders
of Shares. This Offer to Purchase and the related Letter of Transmittal and
other relevant materials will be mailed to record holders of Shares and
furnished to brokers, dealers, commercial banks, trust companies and similar
persons whose names, or the names of whose nominees, appear on the 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. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES.
Upon the terms and subject to the conditions of the Offer (including,
if the Offer is extended or amended, the terms and conditions of any such
extension or amendment), the Purchaser will purchase, by accepting for payment,
and will pay for, all Shares validly tendered prior to the Expiration Date (and
not properly withdrawn in accordance with Section 4) promptly after the later to
occur of (i) the Expiration Date and (ii) the satisfaction or waiver of the
conditions set forth in Section 14. The Purchaser expressly reserves the right,
in its discretion, to delay acceptance for payment of, or, subject to applicable
rules of the SEC, payment for, Shares in order to comply in whole or in part
with any applicable law. For a description of the Purchaser's right to terminate
the Offer and not accept for payment or pay for Shares or to delay acceptance
for payment for Shares, see Section 14.
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<PAGE>
In all cases, payment for Shares purchased pursuant to the Offer will
be made only after timely receipt by the Depositary of (i) the certificates
evidencing such Shares (the "Share Certificates") or timely confirmation of a
book-entry transfer (a "Book-Entry Confirmation") of such Shares, if such
procedure is available, into the Depositary's account at The Depository Trust
Company or the Philadelphia Depository Trust Company (each a "Book-Entry
Transfer Facility" and, collectively, the "Book-Entry Transfer Facilities")
pursuant to the procedures set forth in Section 3, (ii) the Letter of
Transmittal (or facsimile thereof), properly completed and duly executed, or, in
the case of a book-entry transfer, an Agent's Message (as defined below), and
(iii) any other documents required by the Letter of Transmittal. See Section 3.
The term "Agent's Message" means a message, transmitted by a Book-Entry
Transfer Facility to, and received by, the Depositary and forming a part of a
Book-Entry Confirmation, which states that such Book-Entry Transfer Facility has
received an express acknowledgment from the participant in such Book-Entry
Transfer Facility tendering Shares, that such participant has received and
agrees to be bound by the terms of the Letter of Transmittal and that the
Purchaser may enforce such agreement against the participant.
For purposes of the Offer, the Purchaser will be deemed to have
accepted for payment, and thereby purchased, Shares validly tendered and not
properly withdrawn if, as and when the Purchaser gives oral or written notice to
the Depositary of the Purchaser's acceptance of such Shares for payment. Payment
for Shares accepted pursuant to the Offer will be made by deposit of the
purchase price therefor with the Depositary, which will act as agent for
tendering shareholders for the purpose of receiving payments from the Purchaser
and transmitting payments to such tendering shareholders. Under no circumstances
will interest be paid on the Offer Price by the Purchaser, regardless of any
delay in making such payment. Upon the deposit of funds with the Depositary for
the purpose of making payments to tendering shareholders, the Purchaser's
obligation to make such payment shall be satisfied and tendering shareholders
must thereafter look solely to the Depositary for payment of amounts owed to
them by reason of the acceptance for payment of Shares pursuant to the Offer.
The Purchaser will pay any stock transfer taxes incident to the transfer to it
of validly tendered Shares, except as otherwise provided in Instruction 6 of the
Letter of Transmittal, as well as any charges and expenses of the Depositary and
the Information Agent.
If any tendered Shares are not accepted for payment for any reason
pursuant to the terms and conditions of the Offer, or if Share Certificates are
submitted evidencing more Shares than are tendered, Share Certificates
evidencing Shares not purchased will be returned without expense to the
tendering shareholder (or, in the case of Shares tendered by book-entry transfer
into the Depositary's account at a Book-Entry Transfer Facility pursuant to the
procedure set forth in Section 3, such Shares will be credited to an account
maintained at such Book-Entry Transfer Facility) as promptly as practicable
following the expiration or termination of the Offer.
If, prior to the Expiration Date, the Purchaser increases the
consideration to be paid per Share pursuant to the Offer, the Purchaser will pay
such increased consideration for all such Shares purchased pursuant to the
Offer, whether or not such Shares were tendered prior to such increase in
consideration.
The Purchaser reserves the right to transfer or assign, in whole at any
time, or in part from time to time, to the Parent or one or more direct or
indirect wholly owned subsidiaries of the Parent, the right to purchase all or
any portion of the Shares tendered pursuant to the Offer; provided, that any
such transfer or assignment will not relieve the Purchaser of its obligations
under the Offer and will in no way prejudice the rights of tendering
shareholders to receive payment for Shares validly tendered and accepted for
payment pursuant to the Offer.
3. PROCEDURES FOR TENDERING SHARES.
Valid Tender of Shares. In order for Shares to be validly tendered
pursuant to the Offer, the Letter of Transmittal (or facsimile thereof),
properly completed and duly executed, with any required signature guarantees, or
an Agent's Message (in the case of any book-entry transfer), and any other
required documents, must be received by the Depositary at one of its addresses
set forth on the back cover of this Offer to Purchase prior to the Expiration
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<PAGE>
Date and either (i) the Share Certificates evidencing tendered Shares must be
received by the Depositary at one of such addresses or Shares must be tendered
pursuant to the procedure for book-entry transfer described below and a
Book-Entry Confirmation must be received by the Depositary, in each case prior
to the Expiration Date, or (ii) the tendering shareholder must comply with the
guaranteed delivery procedures described below.
THE METHOD OF DELIVERY OF SHARE CERTIFICATES AND ALL OTHER REQUIRED
DOCUMENTS, INCLUDING DELIVERY THROUGH A BOOK-ENTRY TRANSFER FACILITY, IS AT THE
OPTION AND RISK OF THE TENDERING SHAREHOLDER, AND DELIVERY WILL BE DEEMED MADE
ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY. IF DELIVERY IS BY MAIL,
REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED.
IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
Book-Entry Transfer. The Depositary will establish an account with
respect to the Shares at each of the Book-Entry Transfer Facilities for purposes
of the Offer within two business days after the date of this Offer to Purchase,
and any financial institution that is a participant in either of the Book-Entry
Transfer Facilities' systems may make book-entry delivery of Shares by causing
the Book-Entry Transfer Facility to transfer such Shares into the Depositary's
account at a Book-Entry Transfer Facility in accordance with such Book-Entry
Transfer Facility's procedures for transfer. However, although delivery of
Shares may be effected through book-entry transfer at the Book-Entry Transfer
Facility, the Letter of Transmittal (or facsimile thereof), properly completed
and duly executed, with any required signature guarantees or an Agent's Message,
and any other required documents must, in any case, be transmitted to and
received by the Depositary at one of its addresses set forth on the back cover
of this Offer to Purchase prior to the Expiration Date or the tendering
shareholder must comply with the guaranteed delivery procedures described below.
DELIVERY OF DOCUMENTS TO A BOOK-ENTRY TRANSFER FACILITY IN ACCORDANCE WITH SUCH
BOOK-ENTRY TRANSFER FACILITY'S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE
DEPOSITARY.
Signature Guarantee. Signatures on all Letters of Transmittal must be
guaranteed by a firm which is a bank, broker, dealer, credit union, savings
association or other entity that is a member in good standing of the Securities
Transfer Agents Medallion Program (each, an "Eligible Institution"), unless the
Shares tendered thereby are tendered (i) by a registered holder of Shares who
has not completed either the box entitled "Special Delivery Instructions" or the
box entitled "Special Payment Instructions" on the Letter of Transmittal or (ii)
for the account of an Eligible Institution. See Instruction 1 of the Letter of
Transmittal.
If a Share Certificate is registered in the name of a person other than
the signer of the Letter of Transmittal, or if payment is to be made, or Shares
not accepted for payment or not tendered are to be returned, to a person other
than the registered holder(s), then the Share Certificate must be endorsed or
accompanied by appropriate stock powers, in either case signed exactly as the
name(s) of the registered holder(s) appear on the Share Certificate, with the
signature(s) on such Share Certificate or stock powers guaranteed as described
above. See Instructions 1 and 5 of the Letter of Transmittal.
Guaranteed Delivery. If a shareholder desires to tender Shares pursuant
to the Offer and such shareholder's Share Certificates are not immediately
available or time will not permit all required documents to reach the Depositary
prior to the Expiration Date or the procedure for book-entry transfer cannot be
completed on a timely basis, such Shares may nevertheless be tendered if all of
the following conditions are satisfied:
(i) the tender is made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of
Guaranteed Delivery, substantially in the form provided by the
Purchaser herewith, is received by the Depositary as provided below
prior to the Expiration Date; and
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<PAGE>
(iii) the Share Certificates for all tendered Shares, in
proper form for transfer, or a Book-Entry Confirmation, together with a
properly completed and duly executed Letter of Transmittal (or manually
signed facsimile thereof) with any required signature guarantee (or, in
the case of a book-entry transfer, an Agent's Message) and any other
documents required by such Letter of Transmittal, are received by the
Depositary within three New York State Exchange ("NYSE") trading days
after the date of execution of the Notice of Guaranteed Delivery.
Any Notice of Guaranteed Delivery may be delivered by hand or
transmitted by telegram, facsimile transmission or mail to the Depositary and
must include a guarantee by an Eligible Institution in the form set forth in the
Notice of Guaranteed Delivery.
IN ALL CASES, SHARES SHALL NOT BE DEEMED VALIDLY TENDERED, UNLESS A
PROPERLY COMPLETED AND DULY EXECUTED LETTER OF TRANSMITTAL (OR A MANUALLY SIGNED
FACSIMILE), OR AN AGENTS MESSAGE IN THE CASE OF A BOOK-ENTRY TRANSFER, IS
RECEIVED BY THE DEPOSITARY.
Notwithstanding any other provision hereof, payment for Shares
purchased pursuant to the Offer will, in all cases, be made only after timely
receipt by the Depositary of (i) the Share Certificates evidencing such Shares,
or a Book-Entry Confirmation of the delivery of such Shares, (ii) a properly
completed and duly executed Letter of Transmittal (or manually signed facsimile
thereof) and (iii) any other documents required by the Letter of Transmittal.
Distribution Of Rights. Holders of Shares will be required to tender
one Right for each Share tendered to effect a valid tender of such Share. Unless
and until the Distribution Date occurs, the Rights are represented by and
transferred with the Shares. See Introduction. Accordingly, if the Distribution
Date does not occur prior to the Expiration Date, a tender of Shares will
constitute a tender of the associated Rights. If a Distribution Date has
occurred, certificates representing a number of Rights equal to the number of
Shares being tendered must be delivered to the Depositary in order for such
Shares to be validly tendered. If a Distribution Date has occurred, a tender of
Shares without Rights constitutes an agreement by the tendering shareholder to
deliver certificates representing a number of Rights equal to the number of
Shares tendered pursuant to the Offer to the Depositary within three NYSE
trading days after the date such certificates are distributed. The Purchaser
reserves the right to require that it receive such certificates prior to
accepting Shares for payment. If a Distribution Date has occurred, unless the
Rights are redeemed prior to the Expiration Date, shareholders who sell their
Rights separately from their Shares and do not otherwise acquire Rights may not
be able to satisfy the requirements of the Offer for the tender of Shares. The
Purchaser will not pay any additional consideration for the Rights tendered
pursuant to the Offer.
Determination Of Validity. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance for payment of any
tendered Shares pursuant to any of the procedures described above will be
determined by the Purchaser in its reasonable discretion, which determination
will be final and binding on all parties. The Purchaser reserves the absolute
right to reject any or all tenders of Shares determined by it not to be in
proper form or if the acceptance for payment of, or payment for, such Shares
may, in the opinion of the Purchaser's counsel, be unlawful. The Purchaser also
reserves the absolute right, in its sole discretion, to waive any of the
conditions of the Offer or any defect or irregularity in any tender with respect
to Shares of any particular shareholder, whether or not similar defects or
irregularities are waived in the case of other shareholders. In such event the
Purchaser will, if required, extend the Offer in accordance with the applicable
regulations of the SEC. No tender of Shares will be deemed to have been validly
made until all defects and irregularities have been cured or waived.
The Purchaser's interpretation of the terms and conditions of the Offer
(including the Letter of Transmittal and the instructions thereto) will be final
and binding. None of the Parent, the Purchaser, the Company, the Dealer Manager,
the Depositary, the Information Agent or any other person will be under any duty
to give notification of any defects or irregularities in tenders or will incur
any liability for failure to give any such notification.
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<PAGE>
Appointment As Proxy. By executing a Letter of Transmittal as set forth
above, a tendering shareholder irrevocably appoints designees of the Purchaser
as such shareholder's proxies, each with full power of substitution, to the
fullest extent of such shareholder's rights with respect to the Shares tendered
by such shareholder and accepted for payment by the Purchaser (and any and all
noncash dividends, distributions, rights, other Shares, or other securities
issued or issuable in respect of such Shares). All such proxies shall be
considered coupled with an interest in the tendered Shares. This appointment
will be effective if, when, and only to the extent that the Purchaser accepts
such Shares for payment pursuant to the Offer. Upon such acceptance for payment,
all prior proxies given by such shareholder with respect to such Shares and
other securities will, without further action, be revoked, and no subsequent
proxies may be given. The designees of the Purchaser will, with respect to the
Shares and other securities for which the appointment is effective, be empowered
to exercise all voting and other rights of such shareholder as they in their
sole discretion may deem proper at any annual, special, adjourned or postponed
meeting of the Company's shareholders, by written consent or otherwise, and the
Purchaser reserves the right to require that, in order for Shares or other
securities to be deemed validly tendered, immediately upon the Purchaser's
acceptance for payment of such Shares, the Purchaser must be able to exercise
full voting rights with respect to such Shares.
TO PREVENT BACKUP FEDERAL INCOME TAX WITHHOLDING WITH RESPECT TO
PAYMENT TO CERTAIN SHAREHOLDERS OF THE PURCHASE PRICE FOR SHARES PURCHASED
PURSUANT TO THE OFFER, EACH SUCH SHAREHOLDER MUST PROVIDE THE DEPOSITARY WITH
SUCH SHAREHOLDER'S CORRECT TAXPAYER IDENTIFICATION NUMBER AND CERTIFY THAT SUCH
SHAREHOLDER IS NOT SUBJECT TO BACKUP FEDERAL INCOME TAX WITHHOLDING BY
COMPLETING THE SUBSTITUTE FORM W-9 IN THE LETTER OF TRANSMITTAL. IF BACKUP
WITHHOLDING APPLIES WITH RESPECT TO A SHAREHOLDER, THE DEPOSITARY IS REQUIRED TO
WITHHOLD 31% OF ANY PAYMENTS MADE TO SUCH SHAREHOLDER. SEE INSTRUCTION 9 OF THE
LETTER OF TRANSMITTAL.
The Purchaser's acceptance for payment of Shares tendered pursuant to
the Offer will constitute a binding agreement between the tendering shareholder
and the Purchaser upon the terms and subject to the conditions of the Offer.
4. WITHDRAWAL RIGHTS.
Tenders of Shares made pursuant to the Offer are irrevocable except
that such Shares may be withdrawn at any time prior to the Expiration Date and,
unless theretofore accepted for payment by the Purchaser pursuant to the Offer,
may also be withdrawn at any time after Tuesday, May 5, 1998.
If the Purchaser extends the Offer, is delayed in its acceptance for
payment of Shares or is unable to accept Shares for payment pursuant to the
Offer for any reason, then, without prejudice to the Purchaser's rights under
the Offer, the Depositary may, nevertheless, on behalf of the Purchaser, retain
tendered Shares, and such Shares may not be withdrawn except to the extent that
tendering shareholders are entitled to withdrawal rights as described in this
Section 4. Any such delay will be by an extension of the Offer to the extent
required by law.
For a withdrawal to be effective, a written, telegraphic or facsimile
transmission notice of withdrawal must be timely received by the Depositary at
one of its addresses set forth on the back cover of this Offer to Purchase. Any
such notice of withdrawal must specify the name of the person who tendered the
Shares to be withdrawn, the number of Shares to be withdrawn and the name of the
registered holder, if different from that of the person who tendered such
Shares. If Share Certificates evidencing Shares to be withdrawn have been
delivered or otherwise identified to the Depositary, then, prior to the physical
release of such Share Certificates, the serial numbers shown on such Share
Certificates must be submitted to the Depositary and the signature(s) on the
notice of withdrawal must be guaranteed by an Eligible Institution, unless such
Shares have been tendered for the account of an Eligible Institution. If Shares
have been tendered pursuant to the procedure for book-entry transfer as set
forth in Section 3,
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<PAGE>
any notice of withdrawal must also specify the name and number of the account at
a Book-Entry Transfer Facility to be credited with the withdrawn Shares.
All questions as to the form and validity (including time of receipt)
of notices of withdrawal will be determined by the Purchaser, in its reasonable
discretion, which determination will be final and binding. None of the Parent,
the Purchaser, the Company, the Depositary, the Information Agent or any other
person will be under any duty to give notification of any defects or
irregularities in any notice of withdrawal or incur any liability for failure to
give any such notification.
Any Shares properly withdrawn will thereafter be deemed not to have
been validly tendered for purposes of the Offer. However, withdrawn Shares may
be retendered at any time prior to the Expiration Date by following the
procedures described in Section 3.
5. CERTAIN FEDERAL INCOME TAX CONSEQUENCES.
The sale of Shares pursuant to the Offer will be a taxable transaction
for federal income tax purposes under the Internal Revenue Code of 1986, as
amended (the "Code"), and will likely be a taxable transaction under applicable
state, local, foreign and other tax laws as well. Generally, for federal income
tax purposes, a tendering shareholder will recognize gain or loss equal to the
difference, if any, between the amount of cash received by the shareholder
pursuant to the Offer and the aggregate tax basis in the Shares tendered by the
shareholder and purchased pursuant to the Offer. Gain or loss will be computed
separately for each block of Shares (i.e., Shares acquired at the same time and
price) tendered and purchased pursuant to the Offer.
If Shares are held by a shareholder as a capital asset, gain or loss
recognized by the shareholder will be capital gain or loss. Under the recently
enacted Taxpayer Relief Act of 1997, net capital gain (i.e., generally, capital
gain in excess of capital loss) recognized by an individual upon the sale or
exchange of a capital asset that has been held for more than 18 months will
generally be subject to tax at a rate not to exceed 20%. Net capital gain
recognized by an individual from the sale or exchange of a capital asset that
has been held for more than 12 months but not for more than 18 months will
continue to be subject to tax at a rate not to exceed 28%, and net capital gain
recognized from the sale or exchange of a capital asset that has been held for
12 months or less will continue to be subject to tax at ordinary tax rates. In
addition, net capital gain recognized by a corporate taxpayer will continue to
be subject to tax at the ordinary income tax rates applicable to corporations.
Ordinary income recognized by an individual (including dividends and short-term
capital gains recognized by individuals) is subject to Federal income tax at a
maximum rate of 39.6%. The maximum federal tax rate applicable to all capital
gains and ordinary income recognized by a corporation is 35%.
Withholding. Unless a shareholder complies with certain reporting
and/or certification procedures, or is an exempt recipient under applicable
provisions of the Code (and regulations promulgated thereunder), such
shareholder may be subject to "backup" withholding of 31% with respect to any
payments received in the Offer. Shareholders should contact their brokers to
ensure compliance with such procedures. Foreign shareholders should consult with
their tax advisors regarding U.S. withholding taxes in general. Those tendering
their Shares in the Offer may prevent backup withholding by completing the
Substitute Form W-9 included in the Letter of Transmittal.
THE FOREGOING DISCUSSION IS INCLUDED FOR GENERAL INFORMATION ONLY AND
MAY NOT BE APPLICABLE WITH RESPECT TO SHARES RECEIVED PURSUANT TO THE EXERCISE
OF EMPLOYEE STOCK OPTIONS OR OTHERWISE AS COMPENSATION OR WITH RESPECT TO
HOLDERS OF SHARES WHO ARE SUBJECT TO SPECIAL TAX TREATMENT UNDER THE CODE, SUCH
AS NON-U.S. PERSONS, LIFE INSURANCE COMPANIES, TAX-EXEMPT ORGANIZATIONS AND
FINANCIAL INSTITUTIONS, AND MAY NOT APPLY TO A HOLDER OF SHARES IN LIGHT OF
INDIVIDUAL CIRCUMSTANCES. SHAREHOLDERS ARE URGED TO CONSULT THEIR TAX ADVISORS
TO
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DETERMINE THE PARTICULAR TAX CONSEQUENCES TO THEM (INCLUDING ANY STATE, LOCAL OR
OTHER TAX CONSEQUENCES) OF THE OFFER AND THE MERGER.
6. PRICE RANGE OF SHARES; DIVIDENDS.
According to the Company's Annual Report on Form 10-K for the year
ended December 31, 1996 (the "Company Form 10-K") and other publicly-available
information, the Shares are listed and principally traded on the NYSE. The
following table sets forth, for the quarters indicated, the high and low sales
prices per Share on the NYSE and the amount of cash dividends paid per Share, as
reported in the Company Form 10-K for periods in 1995 and 1996 and as reported
by published financial sources with respect to periods in 1997 and 1998:
<TABLE>
<CAPTION>
CASH
HIGH LOW DIVIDENDS
---- --- ---------
YEAR ENDED DECEMBER 31, 1996:
<S> <C> <C> <C>
First Quarter.................................. $17 5/8 $15 3/8 $.06
Second Quarter................................. 18 3/4 16 .06
Third Quarter.................................. 18 1/8 16 1/4 .06
Fourth Quarter................................. 19 1/4 15 7/8 .06
YEAR ENDED DECEMBER 31, 1997:
First Quarter.................................. $17 3/8 $15 $.06
Second Quarter................................. 17 3/4 13 5/8 .06
Third Quarter.................................. 23 16 15/16 .06
Fourth Quarter................................. 35 21 7/8 .06
YEAR ENDING DECEMBER 31, 1998:
First Quarter (through March 5, 1998)........... $37 11/16 $30 1/4
</TABLE>
On February 27, 1998, the last trading day prior to the announcement of
the execution of the Merger Agreement, the reported closing sales price of the
Shares on the NYSE Composite Tape was $36-7/16 per Share. On March 5, 1998, the
last trading day prior to the commencement date of the Offer, the reported
closing sales price of the Shares on the NYSE Composite Tape was $34-15/16 per
Share. SHAREHOLDERS ARE URGED TO OBTAIN A CURRENT MARKET QUOTATION FOR THE
SHARES.
7. EFFECT OF THE OFFER ON THE MARKET FOR THE SHARES, STOCK EXCHANGE
LISTING AND EXCHANGE ACT REGISTRATION.
The purchase of Shares pursuant to the Offer will reduce the number of
Shares that might otherwise trade publicly and will reduce the number of holders
of Shares. This could adversely affect the liquidity and market value of the
remaining Shares held by the public. Depending upon the number of Shares
purchased pursuant to the Offer, the Shares may no longer meet the requirements
for continued listing on the NYSE and may therefore be delisted from the NYSE.
According to the NYSE's published guidelines, the NYSE would consider delisting
the Shares if, among other things: (i) the number of record holders of 100 or
more Shares should fall below 1,200; (ii) the number of publicly held Shares
(exclusive of holdings of the Parent and the Purchaser and any other
subsidiaries or affiliates of the Parent and of officers or directors of the
Company or their immediate families or other concentrated holdings of 10% or
more ("Excluded Holdings")) should fall below 600,000; or (iii) the aggregate
market value of such publicly held Shares (exclusive of Excluded Holdings)
should fall below $5,000,000.
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<PAGE>
According to information supplied by the Company, there are
approximately 2,606 holders of record of Shares. If as a result of the purchase
of Shares pursuant to the Offer or otherwise, the Shares no longer meet the
requirements of the NYSE for continued listing and the listing of the Shares is
discontinued, the market and prices for the Shares could be adversely affected.
If the NYSE were to delist the Shares, it is possible that the Shares
would continue to trade on other securities exchanges or in the over-the-counter
market and that price quotations would be reported by such exchanges or through
the National Association of Securities Dealers Automated Quotation System
("NASDAQ") or other sources. However, the extent of the public market for the
Shares and the availability of such quotations would depend upon such factors as
the number of shareholders and/or the aggregate market value of the
publicly-traded Shares remaining at such time, the interest in maintaining a
market in the Shares on the part of securities firms, the possible termination
of registration under the Exchange Act as described below and other factors.
The Shares are currently "margin securities" under the rules of the
Board of Governors of the Federal Reserve System (the "Federal Reserve Board"),
which has the effect, among other things, of allowing brokers to extend credit
on the collateral of the Shares for the purpose of buying, carrying or trading
in securities ("purpose loans"). Depending upon factors similar to those
described above with respect to stock exchange listing and market quotations,
the Shares might no longer constitute "margin securities" for the purposes of
the Federal Reserve Board's margin regulations and, therefore, could no longer
be used as collateral for purpose loans made by brokers.
The Shares are currently registered under the Exchange Act. The
purchase of Shares pursuant to the Offer may result in the Shares becoming
eligible for deregistration under the Exchange Act. Registration of the Shares
may be terminated upon application of the Company to the SEC if the Shares are
not listed on a national securities exchange and there are fewer than 300 record
holders. The termination of the registration of the Shares under the Exchange
Act would substantially reduce the information required to be furnished by the
Company to holders of the Shares and would make certain provisions of the
Exchange Act, such as the short-swing profit recovery provisions of Section
16(b), the requirement of furnishing a proxy statement in connection with
shareholders' meetings, and the requirements of Rule 13e-3 under the Exchange
Act with respect to "going private" transactions, no longer applicable to the
Shares. Furthermore, "affiliates" of the Company and persons holding "restricted
securities" of the Company could be deprived of the ability to dispose of the
Shares pursuant to Rule 144 under the Securities Act of 1933, as amended. If
registration of the Shares under the Exchange Act were terminated, the Shares
would no longer be "margin securities" or eligible for NASDAQ reporting. The
Purchaser intends to seek to cause the Company to terminate the registration of
the Shares as soon after the consummation of the Offer or the Merger as the
requirements for termination of registration are met.
8. CERTAIN INFORMATION CONCERNING THE COMPANY.
Except as otherwise noted below, the information concerning the Company
contained in this Offer to Purchase, including financial information, has been
taken from or based upon publicly available documents and records on file with
the SEC and other public sources. Neither the Parent, the Purchaser nor the
Dealer Manager assumes any responsibility for the accuracy or completeness of
the information furnished by the Company or contained in such documents and
records or for any failure by the Company to disclose events which may have
occurred or which may affect the significance or accuracy of any such
information but which are unknown to the Parent, Purchaser or the Dealer
Manager.
The Company is a New York corporation whose principal executive offices
are located at 250 Park Avenue, New York, New York 10177. The Company was
incorporated in the State of New York in 1905 as the successor to a partnership
which commenced business in 1867. Unless the context indicates otherwise, the
term the "Company" also refers to its consolidated subsidiaries.
The Company is a diversified manufacturer providing engineered
products, system components and precious metal fabrication for industries
worldwide. The Company's business segments are (i) manufacturing and selling of
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non-precious metal wire, cable and tubing products, primarily stainless steel
and specialty alloys; (ii) manufacturing and selling precious metal products and
precision electroplated materials and stamped parts; and (iii) manufacturing and
selling other specialty products supplied to natural gas, electric and water
utility companies.
Financial Information on the Company. Set forth below is a summary of
certain consolidated financial information with respect to the Company for its
fiscal years ended December 31, 1996, 1995 and 1994. Other than as set forth in
the paragraph below, the information concerning the Company contained herein has
been taken from or been based upon publicly available documents presented in the
Company Form 10-K, the Company's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1997 (the "Company Form 10-Q") and other documents filed by
the Company with the SEC. More comprehensive financial information is included
in such reports (including management's discussion and analysis of results of
operations and financial condition) and other documents filed by the Company
with the SEC, and the financial information summary set forth below is qualified
in its entirety by reference to such reports and other documents, which are
incorporated herein by reference, as well as all the financial information and
related notes contained therein. The Company Form 10-K, the Company Form 10-Q
and such other documents may be examined and copies may be obtained from the
offices of the SEC or the NYSE in the manner set forth below.
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Year Ended Nine Months Ended
December 31, September 30,
---------------------------------- ------------------------------
1996 1995 1994 1997 1996
---- ---- ---- ----
INCOME STATEMENT DATA: (unaudited)
<S> <C> <C> <C> <C> <C>
Sales......................................... $407,107 $427,188 $408,968 $336,018 $310,036
Income from continuing operations, net of
income taxes and before extraordinary
item, excluding net LIFO gains............ 14,513 7,509 6,743 11,996 11,588
Net LIFO gains................................ 19,260 -- -- 2,706 2,913
Loss from extraordinary item.................. (2,889) -- -- -- --
Income (loss) from discontinued operations.... (14,515) 11,131 9,768 -- (9,654)
Net income.................................... 16,369 18,640 16,511 14,702 4,847
INCOME PER COMMON SHARE
INFORMATION:
Continuing operations net of income
taxes and before extraordinary
item, excluding net LIFO gains.......... 1.05 .53 .48 1.00 .83
Net LIFO gains............................ 1.40 -- -- .23 .21
Loss from extraordinary item.............. (.21) -- -- -- --
Income (loss) from discontinued operations (1.05) .79 .70 -- (.69)
Net income................................ $1.19 $1.32 $1.18 $1.23 $.35
</TABLE>
<TABLE>
<CAPTION>
At December 31, At September 30, 1997
----------------------------- ------------------------
1996 1995 (unaudited)
---- ----
BALANCE SHEET DATA:
<S> <C> <C> <C>
Total current assets.......................... $138,674 $163,101 $162,198
Total current liabilities..................... 76,838 113,621 91,856
Total assets.................................. 316,464 341,049 397,582
Total liabilities............................. 220,858 220,655 290,947
Total shareholders' equity.................... $95,606 $120,394 $106,635
</TABLE>
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<PAGE>
On February 11, 1998, the Company filed a press release disclosing
certain financial information related to the fiscal year ended December 31, 1997
and the fourth quarter of such fiscal year. The reported results are summarized
as follows:
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Twelve Months
Ended Quarter Ended
December 31, December 31,
---------------------- ------------------------------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Sales......................................... $451,110 $407,107 $115,092 $97,071
Income from continuing operations, net of
income taxes before extraordinary item,
excluding net LIFO gains................... 17,193 14,513 5,197 2,925
Net LIFO gains................................ 3,717 19,260 1,011 16,347
Loss from extraordinary item.................. -- (2,889) -- (2,889)
Income (loss) from discontinued
operations................................. -- (14,515) -- (4,861)
Net income.................................... 20,910 16,369 6,208 11,522
INCOME PER COMMON SHARE
INFORMATION:
Income per share of Common Stock...........
Basic................................... $1.75 $1.19 $.52 $.86
Fully diluted........................... 1.74 1.18 .51 .86
</TABLE>
More comprehensive financial information will be included in the Company's
Annual Report on Form 10-K for the year ended December 31, 1997, which is
expected to be filed with the SEC not later than March 31, 1998. The reported
results are subject to completion of an audit and year end adjustment.
During the course of the discussions between the Parent and the Company
that led to the execution of the Merger Agreement, the Company provided the
Parent with certain information about the Company which was not publicly
available. The Company indicated that during the year ending December 31, 1998
it expected revenues to increase by approximately 10% to 11%, gross profit
margin to increase by approximately 1%, earnings before interest and taxes
margin to increase by not more than 1%, and earnings before interest, taxes and
depreciation margin to increase by not more than 1%. The Company indicated that
such projections were prepared solely for internal use and were not prepared for
publication or with a view to complying with the published guidelines of the SEC
regarding projections or with the AICPA Guide for Prospective Financial
Statements. This information is included in this Offer to Purchase only because
they were furnished to the Parent. The projections necessarily reflect numerous
assumptions with respect to industry performance, general business and economic
conditions and other matters, many of which are inherently uncertain or beyond
the Company's control. One cannot predict whether the assumptions made in
preparing the forecasts will be accurate, and actual results may be materially
higher or lower than those contained in the forecasts. The inclusion of this
information should not be regarded as an indication that the Parent, the
Purchaser, the Company, or anyone who received this information considered it a
reliable predictor of future events, and this information should not be relied
on as such. None of the Parent, the Purchaser or the Company assumes any
responsibility for the validity, reasonableness, accuracy or completeness of the
forecasts and the Company has made no representation to the Parent or the
Purchaser regarding the forecasts described above.
The Company is subject to the information and reporting requirements of
the Exchange Act and is required to file reports and other information with the
SEC relating to its business, financial condition and other matters.
Information, as of particular dates, concerning the Company's directors and
officers, their remuneration, stock options granted to them, the principal
holders of the Shares, any material interests of such persons in transactions
with the
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<PAGE>
Company and other matters, is required to be disclosed in proxy statements
distributed to the Company's shareholders and filed with the SEC. These reports,
proxy statements and other information should be available for inspection at the
public reference facilities of the SEC located in Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549, and also should be available for
inspection and copying at prescribed rates at the following regional offices of
the SEC: Seven World Trade Center, New York, New York 10048; and 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of these materials
may also be obtained by mail, upon payment of the SEC's customary fees, from the
SEC's principal office at 450 Fifth Street, N.W., Washington, D.C. 20549. The
SEC also maintains an Internet web site at http://www.sec.gov that contains
reports, proxy statements and other information. The Shares are listed on the
NYSE, and reports, proxy statements and other information concerning the Company
should also be available for inspection at the offices of the NYSE, 20 Broad
Street, New York, New York 10005.
9. CERTAIN INFORMATION CONCERNING THE PURCHASER AND THE PARENT.
The Purchaser. The Purchaser is a New York corporation which was
organized in 1997. The principal offices of the Purchaser are located at 110
East 59th Street, New York, NY 10022. The Purchaser is a wholly owned subsidiary
of the Parent. Until immediately prior to the time that the Purchaser will
purchase Shares pursuant to the Offer, it is not expected that the Purchaser
will have any significant assets or liabilities or engage in activities other
than the ownership of Shares and those activities incident to the transactions
contemplated by the Offer.
The Parent. The Parent is a Delaware corporation with its principal
executive offices located at 110 East 59th Street, New York, NY 10022.
The Parent, through its subsidiaries, is a vertically integrated
manufacturer of predominantly value-added flat rolled steel products. The Parent
sells a broad array of value-added products, including cold rolled steel, tin-
and zinc-coated steels and fabricated steel products. The Parent's products are
sold to the construction industry, steel service centers, converters,
processors, and the container, automotive and appliance industries.
Financial Information. Set forth below is a summary of certain
consolidated financial information with respect to the Parent and its
subsidiaries for its fiscal years ended December 31, 1996, 1995 and 1994, and
for the nine months ended September 30, 1997, excerpted from financial
statements presented in the Parent's Annual Report on Form 10-K for the year
ended December 31, 1996 and Quarterly Report on Form 10-Q for the period ended
September 30, 1997, each as filed with the SEC. More comprehensive financial
information is included in such reports (including management's discussion and
analysis of results of operations and financial position) and other documents
filed by the Parent with the SEC, and the financial information summary set
forth below is qualified in its entirety by reference to such reports, which are
incorporated herein by reference, and all the financial information and related
notes contained therein.
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<PAGE>
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Year Ended Nine Months Ended
December 31, September 30,
---------------------------------------- ------------------------
1996 1995 1994 1997 1996
---- ---- ---- ---- ----
INCOME STATEMENT DATA: (unaudited)
<S> <C> <C> <C> <C> <C>
Net sales..................................... $1,232,695 $1,364,614 $1,193,878 $386,717 $1,065,233
Income (loss) before taxes.................... (3,449) 100,075 110,725 (251,105) 50,438
Net (loss) income............................. 658 78,018 76,381 (163,218) 35,306
Dividend requirement for Preferred Stock...... 22,313 22,875 13,177 15,505 16,922
Net income (loss) applicable to Common
Stock..................................... (21,655) 55,143 63,204 (178,723) 18,384
INCOME PER COMMON SHARE
INFORMATION:
Income (loss) per share of Common Stock...
Basic................................... (.82) 2.07 2.19 (7.84) .69
Diluted................................. $(.82) $1.73 $1.89 $(7.84) $.68
</TABLE>
<TABLE>
<CAPTION>
At December 31, At September 30, 1997
-------------------------- -----------------------
1996 1995 (unaudited)
---- ----
BALANCE SHEET DATA:
<S> <C> <C> <C>
Total current assets.................................... $ 737,731 $797,649 $875,022
Property, plant and equipment at cost, less 755,412 793,319 739,800
accumulated depreciation and amortization.............
Total assets............................................ 1,718,779 1,796,467 2,004,217
Total liabilities....................................... 998,571 1,021,674 1,492,569
Total shareholders' equity.............................. $714,437 $768,405 $506,146
</TABLE>
On January 28, 1998, the Parent filed a press release disclosing
certain financial information related to the fiscal year ended December 31, 1997
and the fourth quarter of such fiscal year. The reported results are summarized
as follows:
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Twelve Months Ended Quarter Ended
December 31, December 31,
------------------------ -----------------------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net sales..................................... $642,096 $1,232 $255,380 $167,463
Income (loss) before taxes and extraordinary
item.......................................... (267,341) (3,449) (16,237) (53,887)
Net (loss) income............................. (199,762) 658 (36,544) (34,648)
Dividend requirement for Preferred Stock...... 20,657 22,313 5,152 5,387
Net income (loss) applicable to Common
Stock..................................... (220,419) (21,655) (41,696) (40,035)
INCOME PER COMMON SHARE
INFORMATION:
Income (loss) per share of Common Stock...
Basic................................... $(8.83) $(.83) $(2.11) $(1.60)
Diluted................................. (8.83) (.83) (2.11) (1.60)
</TABLE>
-15-
<PAGE>
More comprehensive financial information will be included in the Parent's Annual
Report on Form 10-K for the year ended December 31, 1997, which is expected to
be filed with the SEC not later than March 31, 1998. The reported results are
subject to completion of an audit and year end adjustment.
The Parent is subject to the information and reporting requirements of
the Exchange Act and is required to file reports and other information with the
SEC relating to its business, financial condition and other matters.
Information, as of particular dates, concerning the Parent's directors and
officers, their remuneration, stock options granted to them, the principal
holders of the Parent's securities, any material interests of such persons in
transactions with the Parent and other matters, is required to be disclosed in
proxy statements distributed to the Parent's shareholders and filed with the
SEC. These reports, proxy statements and other information should be available
for inspection and copies may be obtained in the same manner as set forth for
the Company in Section 8. The Parent's Common Stock is listed on the NYSE, and
reports, proxy statements and other information concerning the Parent should
also be available for inspection at the offices of the NYSE, as set forth in
Section 8.
The name, citizenship, business address, principal occupation or
employment and five-year employment history for each of the directors and
executive officers of the Parent and the Purchaser are set forth in Schedule I
hereto.
Ownership of Shares. The Parent, through its wholly owned subsidiary
Wheeling Pittsburgh Capital Corp., currently beneficially owns an aggregate of
1,649,455 Shares, representing approximately 13.6% of the 12,132,288 Shares
stated by the Company in the Merger Agreement to be outstanding at March 1,
1998, all of which Shares were acquired in the transactions described in
Schedule II to this Offer to Purchase. The aggregate purchase price of such
Shares was approximately $48.4 million, which was obtained from the Parent's
working capital funds.
Except as set forth in Schedule II of this Offer to Purchase, neither
the Parent nor the Purchaser, nor, to the knowledge of the Parent or the
Purchaser, any of the persons listed in Schedule I hereto, or any associate or
majority-owned subsidiary of such persons, beneficially owns any equity security
of the Company, and neither the Parent nor the Purchaser, nor, to the knowledge
of the Parent or the Purchaser, any of the other persons referred to above, or
any of the respective directors, executive officers or subsidiaries of any of
the foregoing, has effected any transaction in any equity security of the
Company during the past 60 days.
Except as set forth in this Offer to Purchase, neither the Parent nor
the Purchaser, nor, to the knowledge of the Parent or the Purchaser, any of the
persons listed in Schedule I hereto, has any contract, arrangement,
understanding or relationship with any other person with respect to any
securities of the Company, including, without limitation, any contract,
arrangement, understanding or relationship concerning the transfer or the voting
of any securities of the Company, joint ventures, loan or option arrangements,
puts or calls, guaranties of loans, guaranties against loss or the giving or
withholding of proxies. Except as set forth in this Offer to Purchase, neither
the Parent nor the Purchaser, nor, to the knowledge of the Parent or the
Purchaser, any of the persons listed in Schedule I hereto, has had any
transactions with the Company, or any of its executive officers, directors or
affiliates, that would require reporting under the rules of the SEC.
Civil Proceedings. On March 31, 1997, the Parent, through the Purchaser
(formerly known as SB Acquisition Corp.), commenced a tender offer for shares of
Dynamics Corporation of America, Inc. ("DCA"), a NYSE-listed company. On April
14, 1997, DCA commenced an action against the Parent in the United States
District Court for the District of Connecticut, alleging, among other things,
that the Parent's tender offer violated Section 14(d) of the Exchange Act and
the rules thereunder (the "DCA Action"). The Parent denied all allegations and
contested the action. On April 29, 1997, Judge Gerard L. Goettel of the United
States District Court, District of Connecticut, issued an order granting a
motion for a preliminary injunction filed by DCA against the Parent and the
Purchaser. The District Court found that the disclosure contained in the
Parent's tender offer materials to DCA shareholders was improper because (i) it
stated that under certain circumstances the Parent "may be required" to comply
with Section 912(b) of the NYBCL and a provision in DCA's charter, instead of
disclosing that the Parent
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<PAGE>
"will be required" to do so; and (ii) it failed to disclose the Parent's future
plans in the event that it was prohibited from merging with DCA for five years.
The Court (i) directed the Parent and the Purchaser to make "further and
complete disclosures" pertaining to those subjects described above, and (ii)
specified that such tender offer be extended for an additional twenty days. This
order was promptly complied with in all respects by the Parent and the
Purchaser. The DCA Action was later discontinued by stipulation between the
parties.
On April 8, 1997, the SEC entered an Order Directing Private
Investigation concerning possible violations of Sections 14(d) and 14(e) of the
Exchange Act and Rules 14d-10(a)(1) and 14e-1(b) thereunder in connection with
the Parent's tender offer for DCA. The Parent fully cooperated with this
investigation. In December 1997, the Staff of the Division of Enforcement of the
SEC (the "SEC Enforcement Staff") has advised the Parent's counsel that the SEC
has authorized the initiation of administrative proceedings seeking a cease and
desist order pertaining to alleged violations of Section 14(d)(4) of the
Exchange Act and Rule 14d-10(a)(1) based on the Parent's inclusion of a "record
holder condition" in the DCA tender offer. This condition was removed by the
Parent shortly after the tender offer began and after the SEC had granted
authority to the Enforcement Staff to seek injunctive relief. At that time, the
SEC Enforcement Staff also advised the Parent's counsel that the SEC has
authorized the initiation of administrative proceedings seeking a cease and
desist order and disgorgement of profits, pertaining to alleged violations of
Section 14(d)(4) of the Exchange Act and Rules 14d-6(d) and 14d-4(c) in
connection with the Parent's closing of the DCA tender offer on June 13, 1997.
The SEC Enforcement Staff has asserted that the Parent's decision to close the
DCA tender offer and purchase approximately 10% of DCA's outstanding shares was
a material change in the conditions of such offer, including its "poison pill
condition" and "interfering transaction condition," each of which was effected
without adequate notice to DCA shareholders. According to the SEC Enforcement
Staff, the tender offer's conditions precluded the Parent from closing as long
as (i) DCA's "poison pill" remained in place, even if the Parent acquired shares
insufficient to trigger the "poison pill"; and (ii) DCA's merger agreement with
another company, CTS Corporation, remained in place. To date, no order
commencing an administrative proceeding has been filed. The Parent believes that
its tender offer complied in all respects with Sections 14(d) and 14(e) and the
rules thereunder and that no violation of law occurred. The Parent believes that
even if such proceeding is brought, and an adverse decision were to be rendered,
there would be no material financial impact on the Parent.
Except as set forth above, during the past five years neither the
Parent nor the Purchaser, nor, to the knowledge of the Parent or the Purchaser,
any of the persons listed in Schedule I hereto, has been a party to a civil
proceeding of a judicial or administrative body of competent jurisdiction and as
a result of such proceeding was or is subject to a judgment, decree or final
order enjoining future violations of, or prohibiting activities subject to,
federal or state securities laws, or finding any violation of such laws.
10. SOURCE AND AMOUNT OF FUNDS.
The Purchaser estimates that the total amount of funds required to
purchase all of the Shares pursuant to the Offer and to pay all related costs
and expenses will be approximately $605 million. This includes approximately
$150 million which may be required to prepay certain long-term indebtedness of
the Company, but does not include approximately $45 million of debt to be
assumed by the Parent. In addition, approximately $23.5 million will be required
to cash out various stock options. In addition, the Purchaser has been informed
that additional amounts may be needed to satisfy existing severance obligations
and various other employee related commitments, either at the conclusion of the
Offer or at the consummation of the Merger. The amount of such obligations will
depend upon the continued satisfaction of the terms of their respective
employment agreements. While the exact amount of severance obligations can not
be determined at this time, it is expected that if required to be paid, such
amounts will be approximately $18.3 million in the aggregate. The Purchaser
plans to obtain all of such funds through capital contributions or advances made
by the Parent.
The Parent currently has on hand approximately $300 million of cash and
marketable securities. The Parent contemplates obtaining the additional monies
necessary to fund this Offer, the Merger and the refinancing of the Company's
existing indebtedness, if necessary, through a private placement of senior notes
(the "Notes"), initially to Donaldson, Lufkin & Jenrette Securities Corporation
and Citicorp Securities, Inc. (collectively, the "Initial Purchasers"). It is
expected that the purchase agreement will provide that the Initial Purchasers
may resell the Notes to qualified institutional buyers in reliance on Rule 144A
under the Securities Act of 1933, as amended (the "Securities Act") or outside
the United States to foreign purchasers in reliance on Regulation S under the
Securities
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<PAGE>
Act. Based upon the initial term sheet, the Parent anticipates to raise
approximately $300 million through the issuance of Notes that are expect to be
unsecured and non-callable for a period of 4 years, and have a term of 7 years.
The Parent has not made any plans to finance or repay the Notes at this time.
Additional terms regarding the structure, covenants and provisions of the Notes
will be as negotiated by the Initial Purchasers and the Parent based on market
conditions at the time of the placement and will be described in an amendment to
the Purchaser's Tender Offer Statement on Schedule 14D-1 (the "Schedule 14D-1").
There can be no assurance that the Parent will consummate the placement of the
Notes. The Offer, however, is not conditioned upon the obtaining of such
financing. The Parent expressly reserves its right to obtain financing for the
transaction through alternative sources.
11. BACKGROUND OF THE OFFER; CONTACTS WITH THE COMPANY.
BACKGROUND OF THE OFFER
On the morning of December 15, 1997, the Parent sent a letter to the
Chairman of the Company regarding a proposed business combination between the
Company and the Parent.
On December 16, 1997, the Parent announced an offer to purchase any and
all Shares, at a price of $30 per Share in cash (the "Initial Tender Offer").
On December 24, 1997, the Company issued a press release announcing
that its Company Board voted unanimously to recommend that shareholders reject
the Initial Tender Offer. On such date the Company also filed with the SEC a
Solicitation/Recommendation Statement on Schedule 14D-9 setting forth the
Company's recommendation with respect to the Parent's offer.
On January 6, 1998, the Parent issued a press release announcing that
it was not inclined to extend the January 16, 1998 expiration date of its
Initial Tender Offer or to change the price. The Parent also disclosed that the
pre-merger notification waiting period under the HSR Act (as defined below) had
expired.
On January 15, 1998, the Company issued a press release announcing that
the Company Board continued to believe that the Initial Tender Offer was
inadequate. The Company stated that it did not believe that the Initial Tender
Offer adequately reflected the Company's growth prospects, operations, the value
of its precious metals inventory, and its pension overfunding.
At 12:00 midnight on January 16, 1998, the Initial Tender Offer
expired. On January 20, 1998, the Parent announced that it had purchased 425,152
Shares (subsequently revised to 425,052 Shares and constituting approximately
3.5% of the then outstanding Shares) validly tendered and not withdrawn as of
the expiration of the Initial Tender Offer.
On January 23, 1998, the Company issued a press release announcing that
it intended to pursue strategic alternatives to enhance shareholder value and
that it had retained Goldman Sachs as its financial advisor.
On January 26, 1998, the Parent purchased 638,403 Shares in open market
transactions, thereby increasing its ownership position to approximately 13.7%.
On January 27, 1998, the Parent's Chairman sent a letter to the
Company's Chairman and indicated that the Parent remained interested in
acquiring the Company in an amicable transaction. Such correspondence also
announced that the Company had retained Donaldson, Lufkin & Jenrette Securities
Corporation ("DLJ") to assist it in negotiating such transaction and that it was
ready, willing and able to meet with representatives of the Company to discuss
an amicable transaction.
In early February 1998, Goldman Sachs contacted DLJ to invite the
Parent to participate in the discussions relating to a possible transaction with
the Parent. At that time Goldman Sachs also requested that Parent first execute
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<PAGE>
a confidentiality and standstill agreement. The Parent, through its financial
advisor, indicated that it would not enter into an agreement with standstill
provisions. Such provisions were ultimately removed and the Parent entered into
a confidentiality agreement on February 28, 1998.
On February 13, 1998, members of the Parent's senior management and its
representatives met with members of the Company's senior management and its
representatives. As a result of this meeting, the Parent indicated that, subject
to a confirmatory due diligence investigation and the negotiation of a
definitive Merger Agreement, the Parent was prepared to offer to acquire all of
the Company's outstanding stock for a price ranging from $33 to $35 per Share.
After additional discussions the Parent indicated that it may be prepared to
make an offer at the high end of such range. The Parent was informed that the
Company Board would be meeting in the near future and that the Company would
respond after such meeting.
During the weeks of February 16 and 23, 1998, DLJ and the Parent
participated in preliminary financial due diligence conferences with Goldman
Sachs in connection with a possible transaction.
On February 24, 1998, the Parent received a draft of a proposed Merger
Agreement from the Company's legal advisor. The Parent sent a revised Merger
Agreement reflecting its comments to the Company's legal advisor on February 27,
1998, which indicated that the Parent was willing to pay $35 per share in cash
for all of the Company's remaining outstanding Shares.
In the evening of February 27, 1998, the Company indicated that it was
willing to continue discussions with the Parent, based on the Parent's comments
on the draft Merger Agreement. From February 28, 1998 to March 1, 1998, members
of the Parent's senior management and its representatives conducted a due
diligence review of the Company. On March 1, 1998, the Parent's representatives
met with the Company's representatives and legal advisors to negotiate the terms
of the Merger Agreement. During such negotiations, the Parent agreed to increase
the offer price to $35.25 per share.
In the evening of March 1, 1998, the Boards of Directors of each of the
Parent and the Company met separately and approved the Offer, the Merger
Agreement and related matters. The Parent, the Purchaser and the Company
executed and delivered the Merger Agreement in the late evening on March 1,
1998. On March 2, 1998, the Parent and the Company issued a joint press release
announcing the execution of the Merger Agreement. The Purchaser commenced the
Offer on March 6, 1998.
* * * * *
Other than as set forth above, there have not been any contacts,
negotiations or transactions between the Parent or the Purchaser, or their
respective subsidiaries, or, to the knowledge of the Parent or the Purchaser,
any of the persons listed in Schedule I hereto, on the one hand, and the Company
or its executive officers, directors or affiliates, on the other hand,
concerning a merger, consolidation or acquisition, tender offer or other
acquisition of securities, election of directors, or a sale or other transfer of
a material amount of assets.
12. PURPOSE OF THE OFFER; MERGER AGREEMENT; PLANS FOR THE COMPANY.
The purpose of the Offer is for the Parent, through the Purchaser, to
acquire control of, and the entire equity interest in, the Company.
MERGER AGREEMENT
The following is a summary of the material terms of the Merger
Agreement. This summary is qualified in its entirety by reference to the full
text of the Merger Agreement, which is incorporated by reference and a copy
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of which has been filed with the SEC as an exhibit to the Schedule 14D-1. The
Merger Agreement may be examined, and copies obtained from the offices of the
SEC, in the same manner as set forth in Section 8.
The Offer. The Merger Agreement provides that the Purchaser will
commence the Offer and that upon the terms and subject to prior satisfaction or
waiver (except that the Minimum Condition may not be waived) of the conditions
of the Offer, the Purchaser will purchase all Shares validly tendered pursuant
to the Offer. The Merger Agreement provides that, without the written consent of
the Company, the Purchaser will not decrease the Offer Price, decrease the
number of Shares sought in the Offer, amend or waive the Minimum Condition, or
amend any condition of the Offer in a manner adverse to the holders of Shares;
PROVIDED, HOWEVER, that subject to applicable legal requirements, the Parent may
cause the Purchaser to waive any condition to the Offer (other than the Minimum
Condition), in the Parent's reasonable judgment, and the Offer may be extended
to comply with applicable rules and regulations of the SEC. If on the initial
scheduled Expiration Date all conditions to the Offer shall not have been
satisfied or waived, the Parent has agreed to cause the Purchaser to extend the
Expiration Date of the Offer from time to time up to May 1, 1998. The Merger
Agreement provides that the Purchaser shall, on the terms and subject to the
prior satisfaction or waiver of the conditions of the Offer, accept for payment
and pay for Shares tendered as soon as it is legally permitted to do so under
applicable law; provided, however, the Purchaser in its sole discretion may
extend the Offer for a period not to exceed 10 business days after the initial
Expiration Date. In addition, the Merger Agreement provides that, without the
consent of the Company, the Offer Price may be increased and the Offer may be
extended to the extent required by law in connection with such an increase in
the Offer Price.
The Merger. Subject to the terms and conditions of the Merger Agreement
and in accordance with the NYBCL, at the Effective Time (as defined in the
Merger Agreement) the Purchaser will merge with and into the Company. The
Company will be the surviving corporation in the Merger, and will continue its
corporate existence under New York law. The Purchaser's charter will be the
Certificate of Incorporation of the Surviving Corporation, and the Purchaser's
By-laws will be the By-Laws of the Surviving Corporation.
As of the Effective Time, by virtue of the Merger and without any
action on the part of any holder of Shares, each issued and outstanding Share
other than Shares owned by the Company, the Parent or any wholly owned
subsidiary of the Parent, held by the Company as treasury stock or held by
shareholders exercising appraisal rights under New York law (or Shares accepted
for payment by the Purchaser pursuant to the Offer), will be converted into the
right to receive $35.25 per Share in cash without interest. As of the Effective
Time, all such Shares will no longer be outstanding, will automatically be
cancelled and retired and will cease to exist and each holder of a certificate
representing any Shares will cease to have any rights in respect thereto except
the right to receive the Merger Consideration. Any Shares owned immediately
prior to the Effective Time by the Company, the Parent or any of their wholly
owned subsidiaries will be cancelled.
Conditions to the Merger. The respective obligations of the Parent and
the Purchaser, on the one hand, and the Company, on the other hand, to effect
the Merger are subject to the satisfaction on or prior to the Closing Date (as
defined in the Merger Agreement) of each of the following conditions, any and
all of which may be waived in whole or in part, to the extent permitted by
applicable law: (i) the Merger Agreement shall have been approved and adopted by
the requisite vote of the holders of Shares, as required by applicable law, in
order to consummate the Merger; (ii) no statute, rule, order, decree or
regulation shall have been enacted or promulgated by any government or any
governmental agency or authority of competent jurisdiction which prohibits the
consummation of the Merger and all governmental consents, orders and approvals
required for the consummation of the Merger and the transactions contemplated by
the Merger Agreement will have been obtained and shall be in effect at the
Effective Time; (iii) there shall be no order or injunction of a court or other
governmental authority of competent jurisdiction in effect precluding,
restraining, enjoining or prohibiting consummation of the Merger; and (iv) the
Parent, the Purchaser or their affiliates shall have purchased Shares pursuant
to the Offer.
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The Company's Board of Directors. The Merger Agreement provides that
promptly after the purchase by the Parent of the Shares pursuant to the Offer,
the Parent shall be entitled to designate such number of directors, rounded up
to the next whole number, on the Company Board as is equal to the product of the
total number of directors on such Company Board multiplied by the percentage
that the number of Shares beneficially owned by the Parent, the Purchaser or
their affiliates bears to the total number of Shares then outstanding, except
that, if the number of Shares purchased pursuant to the Offer equals or exceeds
50.01% of the outstanding Shares, the Company has agreed that the Parent's
representatives will constitute at least a majority of the Company Board. The
Company will, upon request of the Purchaser, use its best efforts promptly to
either increase the size of the Company Board or secure the resignations of such
number of its incumbent directors as is necessary to enable the Parent's
designees to be elected to the Company Board. Until the Effective Time, the
Company shall retain as members of the Company Board at least two directors who
were directors of the Company on March 1, 1998. The Company's obligation to
appoint the Purchaser's designees to the Company Board is subject to Section
14(f) of the Exchange Act and Rule 14f-1 promulgated thereunder.
Following the election or appointment of Company's designees pursuant
to the Merger Agreement and prior to the Effective Time, any amendment or
termination of the Merger Agreement by the Company, extension by the Company for
the performance or waiver of the obligations or other acts of the Parent or the
Purchaser or waiver of the Company's rights thereunder requires the concurrence
of a majority of the directors of the Company then in office who were directors
on the date of the Merger Agreement and who voted to approve the Merger
Agreement, which action shall be deemed to constitute action by the full Company
Board, and if no such directors exists then the action may be effectuated by a
majority of the entire Company Board. Annex A to the Schedule 14D-9 contains
certain information about the persons expected to be designated by the Parent to
be so nominated or elected to the Company Board.
Shareholders Meeting. Pursuant to the Merger Agreement, the Company
will, if required by applicable law in order to consummate the Merger, duly
call, give notice of, convene and hold a special meeting of its shareholders
(the "Special Meeting") as soon as practicable following the acceptance for
payment and purchase of Shares by the Purchaser pursuant to the Offer for the
purpose of considering and taking action upon the approval of the Merger
Agreement. The Merger Agreement provides that the Company will, if required by
applicable law in order to consummate the Merger, prepare and file with the SEC
a preliminary proxy or information statement relating to the Merger and the
Merger Agreement and use its reasonable efforts (i) to obtain and furnish the
information required to be included by the SEC in the Proxy Statement (as
defined herein) and, after consultation with the Parent, to respond promptly to
any comments made by the SEC with respect to the preliminary proxy or
information statement and cause a definitive proxy or information statement (the
"Proxy Statement") to be mailed to its shareholders and (ii) to obtain the
necessary approvals of the Merger and the Merger Agreement by its shareholders.
If the Purchaser acquires at least two-thirds of the outstanding Shares, the
Purchaser will have sufficient voting power to approve the Merger, even if no
other shareholder votes in favor of the Merger. The Company has agreed, subject
to the fiduciary obligations of the Company Board under applicable law as
advised by independent counsel, to include in the Proxy Statement the
recommendation of the Company Board that shareholders of the Company vote in
favor of the approval of the Merger and the adoption of the Merger Agreement.
The Parent has agreed that it will vote, or cause to be voted, all of the Shares
then owned by it, the Purchaser or any of its other subsidiaries and affiliates
in favor of the approval of the Merger and the adoption of the Merger Agreement.
The Merger Agreement provides that in the event that the Parent, the
Purchaser or any other subsidiary of the Parent acquires at least 90% of the
outstanding Shares, pursuant to the Offer or otherwise, the Parent, the
Purchaser and the Company will, at the request of the Parent and subject to the
terms of the Merger Agreement, take all necessary and appropriate action to
cause the Merger to become effective as soon as practicable after such
acquisition, without a meeting of shareholders of the Company, in accordance
with Section 905 of the NYBCL.
Options. Pursuant to the Merger Agreement, effective as of the
Effective Time, the Parent and the Company shall cause (i) each outstanding
option to purchase Shares granted under the Company's employee and director
stock
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option plans (collectively, the "Option Plans"), whether or not then exercisable
or vested, to become fully exercisable and vested, (ii) each option that is then
outstanding to be cancelled, and (iii) the Company (or, at the Parent's option,
the Purchaser) to pay to such holders of options an amount equal the product of
(a) the excess, if any, of the Offer Price over the exercise price of each such
Option and (b) the number of Shares previously subject to the Option immediately
prior to its cancellation.
Interim Operations. Pursuant to the Merger Agreement, the Company has
agreed that, except as expressly contemplated or provided by the Merger
Agreement or agreed to in writing by the Parent, prior to the time the directors
of the Purchaser constitute a majority of the Company Board, (i) the business of
the Company and its subsidiaries shall be conducted only in the ordinary and
usual course of business; (ii) the Company will not, directly or indirectly, (a)
sell, transfer or pledge or agree to sell, transfer or pledge any Shares or
capital stock of any of its subsidiaries beneficially owned by it, either
directly or indirectly; (b) amend its Certificate of Incorporation or Bylaws or
similar organizational documents; or (c) split, combine or reclassify the
outstanding Shares or any outstanding capital stock of any of the subsidiaries
of the Company; (iii) neither the Company nor any of its subsidiaries shall, (a)
declare, set aside or pay any dividend or other distribution payable in cash,
stock or property with respect to its capital stock except for its regular
quarterly cash dividend; (b) issue, sell, pledge, dispose of or encumber any
additional shares of, or securities convertible into or exchangeable for, or
options, warrants, calls, commitments or rights of any kind to acquire, any
shares of capital stock of any class of the Company or its subsidiaries, other
than Shares reserved for issuance on the date thereof upon exercise of
outstanding Rights pursuant to the Rights Agreement or issuances pursuant to the
exercise of options outstanding on the date thereof; (c) transfer, lease,
license, sell, mortgage, pledge, dispose of, or encumber any material assets
other than in the ordinary and usual course of business and consistent with past
practice including, without limitation, certain sales of precious metal
inventories; (d) incur or modify any material indebtedness or other material
liability, other than in the ordinary and usual course of business and
consistent with past practice, provided that the Company may borrow money for
use in the ordinary and usual course of business; or (e) redeem, purchase or
otherwise acquire directly or indirectly any of its capital stock other than
redemption of the outstanding Rights pursuant to the Rights Agreement; (iv)
neither the Company nor any of its subsidiaries shall modify, amend or terminate
any of its material agreements or waive, release or assign any material rights
or claims, except in the ordinary course of business and consistent with past
practice; (v) neither the Company nor any of its subsidiaries shall permit any
material insurance policy naming it as a beneficiary or a loss payable payee to
be cancelled or terminated without notice to the Parent, except in the ordinary
course of business and consistent with past practice; (vi) neither the Company
nor any of its subsidiaries shall: (a) assume, guarantee, endorse or otherwise
become liable or responsible (whether directly, contingently or otherwise) for
the material obligations of any other person, except in the ordinary course of
business and consistent with past practice; (b) make any material loans,
advances or capital contributions to, or investments in, any other person (other
than to subsidiaries of the Company), other than in the ordinary course of
business and consistent with past practice; or (c) enter into any material
commitment or transaction with respect to any of the foregoing (including, but
not limited to, any borrowing, capital expenditure or purchase, sale or lease of
assets); (vii) neither the Company nor any of its subsidiaries shall change any
of the accounting methods used by it unless required by GAAP; (viii) neither the
Company nor any of its subsidiaries will adopt a plan of complete or partial
liquidation, dissolution, merger, consolidation, restructuring, recapitalization
or other reorganization of the Company or any of its subsidiaries (other than
the Merger); (ix) neither the Company nor any of its subsidiaries will, except
as required by law, enter into, adopt, create or amend in any material respect
or terminate any benefit plans maintained or contributed to by the Company or
any of its subsidiaries; (x) neither the Company nor any of its subsidiaries
will make or agree to make any capital expenditure or capital expenditures other
than capital expenditures in accordance with the Company's 1998 capital
expenditure program or in the ordinary course of business consistent with past
practice; (xi) neither the Company nor any of its subsidiaries will increase the
compensation of any director, executive officer or other key employee of the
Company or pay any benefit or amount not required by a plan, agreement,
understanding or arrangement as in effect on the date of this Agreement to any
such person; (xii) neither the Company nor any of its subsidiaries will cause a
material change in investment policy or a material change in investment vehicles
related to the assets in any pension plan, other than actions taken in the
ordinary course of business or that are consistent with or required by its
fiduciary duties; (xiii) neither the Company nor any of its
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subsidiaries will take, or agree to commit to take, any action that would make
any representation or warranty of the Company contained herein inaccurate in any
material respect at, or as of any time prior to, the Effective Time (except for
representations made as of a specific date); or (xiv) neither the Company nor
any of its subsidiaries will authorize or enter into an agreement to do any of
the foregoing actions.
No Solicitation. Pursuant to the Merger Agreement, the Company has
agreed that neither the Company nor any of its subsidiaries or affiliates shall,
directly or indirectly, solicit, participate in or initiate discussions or
negotiations with, or provide any information to, any corporation, partnership,
person or other entity or group (other than the Parent, or any of its affiliates
or representatives) concerning any merger, consolidation, tender offer, exchange
offer, sale of assets, sale of shares of capital stock or similar business
combination transactions involving the Company or any principal operating or
business unit of the Company (an "Acquisition Proposal"). The Merger Agreement
provides that the Company may furnish information concerning its business,
properties or assets to any corporation, partnership, person or other entity or
group pursuant to appropriate confidentiality agreements, and may negotiate and
participate in discussions and negotiations with such entity or group concerning
an Acquisition Proposal if (i) such entity or group has submitted a bona fide
written proposal on an unsolicited basis to the Company Board relating to such
transaction which the Company Board determines represents a superior transaction
to the Offer and the Merger and (ii) if, in the opinion of the Company Board,
only after receipt of advice from independent legal counsel, the failure to
provide such information or access or to engage in such discussions or
negotiations would cause the Company Board to violate its fiduciary duties to
the Company's shareholders under applicable law.
Indemnification and Insurance. Pursuant to the Merger Agreement, for
six years after the Effective Time, the Parent shall, and shall cause the
Surviving Corporation (or any successor of the Surviving Corporation) to,
indemnify, defend and hold harmless the present and former officers and
directors of the Company and its subsidiaries with respect to matters occurring
at or prior to the Effective Time to the fullest extent permitted permitted
under New York law or the Company's Certificate of Incorporation, Bylaws or
indemnification agreements in effect at the date of the Merger Agreement. The
Merger Agreement also provides that the Parent or the Surviving Corporation
shall maintain the Company's existing officers' and directors' liability
insurance ("D&O Insurance") for a period of not less than six years after the
Effective Time, provided that the Parent may substitute therefor policies of
substantially similar coverage and amounts containing terms no less favorable to
such former directors or officers. The Parent has also agreed that if the
existing D&O Insurance expires, is terminated or cancelled during such period,
the Parent or the Surviving Corporation will use its best efforts to obtain
substantially similar D&O Insurance, but in no event shall it be required to pay
aggregate premiums for such insurance in excess of 200% of the aggregate
premiums paid in 1997.
Representations and Warranties. In the Merger Agreement, the Company
has made customary representations and warranties to the Parent and the
Purchaser with respect to, among other things, its organization, standing and
corporate power; capitalization; authorization; validity of agreement and
Company action relating to the Merger Agreement; consents and approvals; the
accuracy of information in documents filed with the SEC; the absence of
undisclosed liabilities; the absence of any material adverse changes in the
Company since September 30, 1997; certain employment benefit plans and
employment agreements maintained or entered into by the Company; the absence of
material litigation; compliance with applicable laws; taxes; real property;
environmental matters; the accuracy of information supplied in connection with
this Offer to Purchase and the related filings with the SEC; the expiration of
the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended (the "HSR Act"); the quantities of the Company's
precious metals inventories as of February 27, 1998; engagement and payment of
fees of brokers, investment bankers, finders and financial advisors; and receipt
of the Goldman Fairness Opinion.
In the Merger Agreement, the Parent and the Purchaser have made
customary representations and warranties to the Company with respect to, among
other things, organization; authorization; capital structure; information in the
Schedule 14D-9 and Proxy Statement; compliance with laws; consents and
approvals; brokers' fees; financing; share ownership; operations of Purchaser;
HSR Act approval; and limitation of liability.
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Employee Arrangements. The Merger Agreement provides that the Parent
and the Purchaser will continue the employment of all persons who, immediately
prior to the Effective Time, were employees of the Company or its subsidiaries
("Retained Employees"). The Company believes that the Merger Agreement provides
that payments under the employee and severance agreements are required to be
made at the consummation of the Offer, since the Merger Agreement provides that
officers of the Purchaser will be officers of the Surviving Corporation. The
Purchaser has advised the Company that it intends to appoint the officers of the
Company to their respective positions simultaneously with the consummation of
the Merger, and in its view no payment under the employment and severance
agreements would be required at the Effective Time or at the time of the
consummation of the Offer.
The Parent and the Purchaser have also agreed that, effective as of the
Effective Time and for a three-year period following the Effective Time, the
Surviving Corporation and its subsidiaries and successors will provide the
Retained Employees with employee plans and programs which provide benefits that
are no less favorable in the aggregate to those provided to such employees
immediately prior to the date of the Merger Agreement. With respect to such
benefits, service accrued by such employees with the Company and its
subsidiaries prior to the Effective Time shall be recognized for all purposes,
except to the extent necessary to prevent duplication of benefits. Nothing in
the foregoing shall be deemed to require the employment of any Retained Employee
to be continued for any particular period of time after the Effective Time.
Pursuant to the Merger Agreement, the Parent and the Purchaser have
agreed to honor, and cause the Surviving Corporation to honor, without
modification, all employment and severance agreements and arrangements, as
amended through the date of the Merger Agreement, with respect to employees and
former employees of the Company.
Termination; Fees. The Merger Agreement may be terminated and the
Merger abandoned at any time prior to the Effective Time, whether before or
after approval of the shareholders of the Company, (i) by mutual consent of the
Board of Directors of the Parent or the Purchaser and the Company Board, (ii) by
either the Board of Directors of the Parent or the Purchaser and the Company
Board (a) if the Offer shall have expired without any Shares being purchased
therein on or prior to July 1, 1998, provided that such right to terminate shall
not be available to any party whose failure to fulfill any obligation under the
Merger Agreement was the cause of, or resulted in, the failure of the Parent or
the Purchaser to purchase the Shares on or before such date; or (b) if any
Governmental Entity (as defined therein) shall have issued an order, decree or
ruling or taken any other action (which order, decree, ruling or other action
the parties shall use their reasonable efforts to lift), in each case
permanently restraining, enjoining or otherwise prohibiting the transactions
contemplated by the Merger Agreement and such order, decree, ruling or other
action shall have become final and non-appealable, (iii) by the Company Board
(a) if, prior to the purchase of Shares pursuant to the Offer, the Company Board
shall have (x) withdrawn (or modified or changed in a manner adverse to the
Parent or the Purchaser) its approval or recommendation of the Offer, the Merger
Agreement or the Merger in order to permit the Company to execute a definitive
agreement providing for the acquisition of the Company by merger, consolidation
or otherwise on terms determined by the Company Board to be superior to the
stockholders of the Company than the acquisition of the Company contemplated by
the Merger Agreement, and (y) determined, only after receipt of advice from
independent legal counsel to the Company, that the failure to take such action
as set forth in the preceding clause (x) would cause the Company Board to
violate its fiduciary duties to the Company's stockholders under applicable law;
PROVIDED, HOWEVER, that prior to any such termination the Company shall have
given the Parent at least two business days notice of the effectiveness of such
termination, and simultaneously with the effectiveness of such termination, pay
to the Parent the $8 million termination fee referred to below; or (b) if, prior
to the purchase of Shares pursuant to the Offer, the Parent or the Purchaser
breaches or fails in any material respect to perform or comply with any of its
material covenants and agreements contained in the Merger Agreement or breaches
its representations and warranties in any material respect; (c) if the Parent or
the Purchaser shall have terminated the Offer, or the Offer shall have expired,
without the Parent or the Purchaser, as the case may be, purchasing any Shares
pursuant thereto; provided, that the Company may not terminate the Merger
Agreement pursuant to this clause if the Company is in material breach of the
Merger Agreement; or (iv) by the Board of Directors of the Parent or the
Purchaser if prior to the purchase of Shares pursuant to the Offer, the Company
Board shall have withdrawn or modified or changed in a manner adverse to the
Parent or the Purchaser its approval or recommendation of the Offer, the Merger
Agreement or the Merger, or shall have recommended an Acquisition Proposal or
offer, or shall have executed an agreement in principle (or similar agreement)
or definitive agreement providing for a tender offer or exchange offer for any
shares of capital stock of the Company, or a merger, consolidation or other
business combination with a person or entity other than the Parent, the
Purchaser or their affiliates (or the Company Board resolves to do any of the
foregoing).
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In accordance with the Merger Agreement, if the Company Board
terminates this Agreement pursuant to clause (iii)(a) of the immediately
preceding paragraph or the Parent terminates this Agreement pursuant to clause
(iv) of the immediately preceding paragraph (provided that at the time of such
termination by the Parent, the Parent and the Purchaser were not in material
breach the Merger Agreement), the Company is obligated to concurrently pay to
the Parent a termination fee of $8 million.
Amendments and Waivers. The Merger Agreement may be amended by the
parties by an instrument in writing signed on behalf of each party at any time
before or after any vote of the shareholders of the Company. However, after any
such approval, the Merger Agreement does not permit the parties to make any
amendment that by law requires further approval by the shareholders of the
Company without the further approval of such shareholders, including a reduction
or change in the Merger Consideration.
Appraisal Rights. Shareholders do not have statutory appraisal rights
as a result of the Offer. However, if the Merger is consummated, shareholders of
the Company at the time of the Merger will have certain rights to dissent and
demand appraisal of their Shares under the NYBCL. Dissenting shareholders who
comply with the requisite statutory procedures in accordance with Section 623 of
the NYBCL will be entitled to a judicial determination and payment of the "fair
value" of their Shares as of the close of business on the day prior to the date
of shareholder authorization of the Merger, together with interest thereon, at
such rate as the court finds equitable, from the date the Merger is consummated
until the day of payment. Under the NYBCL, in fixing the fair value of the
Shares, a court would consider the nature of the transaction giving rise to the
shareholders' right to receive payment for Shares and its effects on the Company
and its shareholders, the concepts and methods then customary in the relevant
securities and financial markets for determining fair value of shares of a
corporation engaging in a similar transaction under comparable circumstances,
and all other relevant factors. The value so determined could be more or less
than the purchase price offered pursuant to the Offer or the Merger.
Going Private Transactions. The SEC has adopted Rule 13e-3 under the
Exchange Act, which is applicable to certain "going private" transactions and
which may under certain circumstances be applicable to the Merger following the
purchase of Shares pursuant to the Offer. Rule 13e-3 should not be applicable to
the Merger if the Merger is consummated within one year after the expiration or
termination of the Offer and the price paid in the Merger is not less than the
per Share price paid pursuant to the Offer. However, in the event that the
Purchaser is deemed to have acquired control of the Company pursuant to the
Offer and if the Merger is consummated more than one year after completion of
the Offer or an alternative acquisition transaction is effected whereby
shareholders of the Company receive consideration less than that paid pursuant
to the Offer, in either case at a time when the Shares are still registered
under the Exchange Act, the Purchaser may be required to comply with Rule 13e-3
under the Exchange Act. If applicable, Rule 13e-3 would require, among other
things, that certain financial information concerning the Company and certain
information relating to the fairness of the Merger or such alternative
transaction and the consideration offered to the shareholders other than the
Purchaser, the Parent and their affiliates in the Merger or such alternative
transaction, be filed with the SEC and disclosed to shareholders prior to
consummation of the Merger or such alternative transaction. If such registration
were terminated, Rule 13e-3 would be inapplicable to any such transaction.
The Purchaser reserves the right to purchase, following consummation,
termination, or withdrawal of the Offer, additional Shares or Rights in the open
market, in privately negotiated transactions, in another tender offer or
exchange offer or otherwise. In addition, in the event that the Merger does not
occur, the Purchaser will evaluate its other alternatives. These alternatives
could include purchasing Shares or Rights in the open market, in privately
negotiated transactions, in another tender offer or exchange offer or otherwise,
or taking no further action to acquire Shares or Rights. Any additional
purchases of Shares or Rights could be at a price greater or less than the price
to be paid for Shares and Rights in the Offer and could be for cash or other
consideration. Alternatively, the Purchaser and the Parent may sell or otherwise
dispose of any or all Shares or Rights acquired pursuant to the Offer or
otherwise. Such transactions may be effected on terms and at prices then
determined by the Purchaser and the Parent, which may vary from the price
proposed to be paid for Shares and Rights in the Offer.
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PLANS FOR THE COMPANY.
The Purchaser and the Parent have no present intention to make any
significant changes in the business strategies of the Company, and (except as
described below) they have not identified any specific assets, corporate
structure, or business strategy which warrants change. In the course of the
Parent's due diligence review, significant attention was given to the
overfunding in the Company's pension plans and its precious metals inventory.
The Parent currently intends to continue to review the Company's pension plans
to determine whether any of the pension plans of the Parent and the Company and
their subsidiaries can be combined or administered in a manner that will reduce
the net total annual pension funding costs of the combined companies. The Parent
will seek to ensure that the Company's retired employees and its contractual
commitments will be adequately protected and the Parent does not intend to
curtail or modify the Company's pension plans as they relate to the groups of
employees covered or the amounts of pension benefits provided to employees. The
Parent also plans to further explore the possibility of realizing the monetary
value of a substantial portion of the Company's precious metals inventory, which
currently has a market value substantially in excess of the book value of such
asset, however, the Parent has not determined at the present time the best way
to realize the monetary value of the Company's precious metals inventory.
If the Purchaser acquires control of the Company, the Parent intends to
conduct a detailed review of the Company and its assets, corporate structure,
dividend policy, capitalization, operations, properties, policies, management
and personnel and consider at the same time what, if any, changes or sale of
assets would be desirable in light of the circumstances which then exist.
Except as noted in this Offer to Purchase, neither the Parent nor the
Purchaser has any present plans or proposals that would result in an
extraordinary corporate transaction, such as a reorganization, liquidation,
relocation of operations, or sale or transfer of assets, involving the Company
or any of its subsidiaries, or any material changes in the Company's corporate
structure, business or composition of its board of directors, management or
personnel.
13. DIVIDENDS AND DISTRIBUTIONS.
If, on or after the date of this Offer to Purchase, the Company should
(i) split, combine or otherwise change the Shares or its capitalization, (ii)
issue or sell any additional securities of the Company or otherwise cause an
increase in the number of outstanding securities of the Company or (iii) acquire
currently outstanding Shares or otherwise cause a reduction in the number of
outstanding Shares, then, without prejudice to the Purchaser's rights under
Sections 1 and 14, the Purchaser, in its sole discretion, may make such
adjustments as it deems appropriate in the purchase price and other terms of the
Offer, including, without limitation, the amount and type of securities offered
to be purchased.
If, on or after the date of this Offer to Purchase, the Company should
declare or pay any dividend on the Shares, other than regular quarterly
dividends not to exceed $.06 per Share, or make any distribution (including,
without limitation, the issuance of additional Shares pursuant to a stock
dividend or stock split, the issuance of other securities or the issuance of
rights for the purchase of any securities) with respect to the Shares that is
payable or distributable to shareholders of record on a date prior to the
transfer to the name of the Purchaser or its nominee or transferee on the
Company's stock transfer records of the Shares purchased pursuant to the Offer,
then, without prejudice to the Purchaser's rights under Sections 1 and 14, (i)
the purchase price per Share payable by the Purchaser pursuant to the Offer will
be reduced by the amount of any such cash dividend or cash distribution, and
(ii) any such non-cash dividend, distribution or right to be received by the
tendering shareholders will be received and held by such tendering shareholders
for the account of the Purchaser and will be required to be promptly remitted
and transferred by each such tendering shareholder to the Depositary for the
account of the Purchaser, accompanied by appropriate documentation of transfer.
Pending such remittance and subject to applicable law, the Purchaser will be
entitled to all rights and privileges as owner of any such non-cash dividend,
distribution or right and may withhold the entire purchase price or deduct from
the purchase price the amount of value thereof, as determined by the Purchaser
in its sole discretion.
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<PAGE>
14. CONDITIONS OF THE OFFER.
Notwithstanding any other provisions of the Offer, and in addition to
(and not in limitation of) the Purchaser's rights to extend and amend the Offer
at any time in its sole discretion (subject to the provisions of the Merger
Agreement), the Purchaser shall not be required to accept for payment or,
subject to any applicable rules and regulations of the SEC, including Rule
14e-1(c) under the Exchange Act (relating to the Purchaser's obligation to pay
for or return tendered Shares promptly after termination or withdrawal of the
Offer), pay for, and may delay the acceptance for payment of or, subject to the
restriction referred to above, the payment for, any tendered Shares, and may
terminate the Offer if (i) the Minimum Condition has not been satisfied, (ii)
the Rights under the Rights Agreement shall have become exercisable, or (iii) at
any time on or after March 1, 1998 and before the time of acceptance of Shares
for payment pursuant to the Offer, any of the following events shall occur:
(a) there shall have been any action taken, or any statute, rule,
regulation, judgment, order or injunction promulgated, entered, enforced,
enacted, issued or applicable to the Offer or the Merger by any domestic or
foreign federal or state governmental regulatory or administrative agency or
authority or court or legislative body or commission which (i) prohibits, or
imposes any material limitations on, the Parent's or the Purchaser's ownership
or operation of all or a material portion of the Company's businesses or assets,
(ii) prohibits, or makes illegal the acceptance for payment, payment for or
purchase of Shares or the consummation of the Offer or the Merger, (iii) results
in a material delay in or restricts the ability of the Purchaser, or renders the
Purchaser unable, to accept for payment, pay for or purchase some or all of the
Shares, or (iv) imposes material limitations on the ability of the Purchaser or
the Parent to effectively exercise full rights of ownership of the Shares,
including, without limitation, the right to vote the Shares purchased by it on
all matters properly presented to the Company's shareholders, provided that the
Parent shall have used all reasonable efforts to cause any such judgment, order
or injunction to be vacated or lifted;
(b) the representations and warranties of the Company set forth in the
Merger Agreement shall not be true and correct as of the date of consummation of
the Offer as though made on or as of such date or the Company shall have
breached or failed to perform or comply with any material obligation, agreement
or covenant required by the Merger Agreement to be performed or complied with by
it except, in each case, (i) for changes specifically permitted by the Merger
Agreement and (ii) (A) those representations and warranties that address matters
only as of a particular date which are true and correct as of such date or (B)
where the failure of such representations and warranties to be true and correct,
or the performance or compliance with such obligations, agreements or covenants,
do not, individually or in the aggregate, have a material adverse effect on the
Company and its subsidiaries, taken as a whole;
(c) the Merger Agreement shall have been terminated in accordance with
its terms;
(d) (i) it shall have been publicly disclosed that any person, entity
or "group" (as defined in Section 13(d)(3) of the Exchange Act), shall have
acquired beneficial ownership (as determined pursuant to Rule 13d-3 promulgated
under the Exchange Act) of more than 20% of any class or series of capital stock
of the Company (including the Shares), through the acquisition of stock, the
formation of a group or otherwise, other than any person or group existing on
the date hereof which beneficially owns more than 20% of any class or series of
capital stock of the Company or (ii) the Company shall have entered into a
definitive agreement or agreement in principle with any person with respect to
an Acquisition Proposal or similar business combination with the Company;
(e) the Company Board shall have withdrawn, or modified or changed in a
manner adverse to the Parent or the Purchaser (including by amendment of the
Schedule 14D-9) its recommendation of the Offer, the Merger Agreement, or the
Merger, or recommended another proposal or offer, or shall have resolved to do
any of the foregoing; or
(f) there shall have occurred (i) a decline of at least 25% in either
the Dow Jones Average of Industrial Stocks or the Standard & Poor's 500 Index
from the date of the Merger Agreement, or (ii) the declaration and
-27-
<PAGE>
continuation of a banking moratorium or any limitation or suspension of payments
in respect of the extension of credit by banks or other lending institutions in
the United States;
which in the reasonable judgment of the Parent or the Purchaser, in any such
case, and regardless of the circumstances giving rise to such condition, makes
it inadvisable to proceed with the Offer and/or with such acceptance for payment
or payments.
The foregoing conditions are for the sole benefit of the Purchaser and
the Parent and may be waived by the Parent or the Purchaser, in whole or in part
at any time and from time to time in the reasonable discretion of the Parent or
the Purchaser.
A public announcement will be made of a material change in, or waiver
of, such conditions, to the extent required by Rules 14d-4(c) and 14d-6(d) under
the Exchange Act, and the Offer will be extended in connection with any such
change or waiver to the extent required by such rules.
15. CERTAIN LEGAL MATTERS AND REGULATORY APPROVALS.
General. Except as set forth below, based upon an examination of
publicly available filings made by the Company with the SEC and other publicly
available information concerning the Company, neither the Purchaser nor the
Parent is aware of any licenses or other regulatory permits that appear to be
material to the business of the Company and its subsidiaries, taken as a whole,
that might be adversely affected by the Purchaser's acquisition of Shares (and
the indirect acquisition of the stock of the Company's subsidiaries) as
contemplated herein, or of any filings, approvals or other actions by or with
any domestic (federal or state), foreign or supranational governmental authority
or administrative or regulatory agency that would be required prior to the
acquisition of Shares (or the indirect acquisition of the stock of the Company's
subsidiaries) by the Purchaser pursuant to the Offer as contemplated herein.
Should any such approval or other action be required, it is the Purchaser's
present intention to seek such approval or action. However, the Purchaser does
not presently intend to delay the purchase of Shares tendered pursuant to the
Offer pending the receipt of any such approval or the taking of any such action
(subject to the Purchaser's right to delay or decline to purchase Shares if any
of the conditions in Section 14 shall have occurred). There can be no assurance
that any such approval or other action, if needed, would be obtained without
substantial conditions or that adverse consequences might not result to the
business of the Company, the Parent or the Purchaser or that certain parts of
the businesses of the Company, the Parent or the Purchaser might not have to be
disposed of or held separate or other substantial conditions complied with in
order to obtain such approval or other action or in the event that such approval
was not obtained or such other action was not taken, any of which could cause
the Purchaser to elect to terminate the Offer without the purchase of the Shares
thereunder. The Purchaser's obligation under the Offer to accept for payment and
pay for Shares is subject to certain conditions, including conditions relating
to the legal matters discussed in this Section 15. See Section 14.
State Takeover Statutes. The Company is incorporated under the laws of
New York. In general, Section 912 of the NYBCL prohibits a New York corporation
from engaging in a "Business Combination" (defined as any of a variety of
transactions including mergers) with an "Interested Shareholder" (defined
generally as a person owning shares entitled to cast at least 20% of the voting
power of a corporation) for a period of five years following the date such
person became an Interested Shareholder, unless, before such person became an
Interested Shareholder, the corporation's board of directors approved either the
Business Combination or the transaction in which the shareholder became an
Interested Shareholder. The Company has represented in the Merger Agreement that
the Company Board has approved the Merger Agreement and the consummation of the
Merger and the other transactions contemplated thereby and that such approval
constitutes approval of the Company Board of the Merger and the other
transactions contemplated by the Merger Agreement under Section 912 of the NYBCL
If an assertion is made that the Parent or the Purchaser has not
complied with the provisions of any state takeover statute, the Parent and the
Purchaser reserve the right to challenge the validity or applicability of any
state
-28-
<PAGE>
law allegedly applicable to the Merger and nothing in this Offer to Purchase nor
any action taken in connection herewith is intended as a waiver of that right.
Article 16 of the NYBCL requires the bidder for the shares of a New
York corporation to file a registration statement with the attorney general and
to satisfy certain disclosure requirements. The Parent and the Purchaser have
filed such a registration statement and this Offer to Purchase sets forth all of
the information required to be disclosed pursuant to Article 16 of the NYBCL.
A number of other states have adopted laws and regulations applicable
to attempts to acquire securities of corporations that are incorporated, or have
substantial assets, shareholders, or whose business operations otherwise have
substantial economic effects in such states. The Company, directly or through
subsidiaries, conducts business in a number of states throughout the United
States, some of which may have enacted takeover laws as described above. Except
for those provisions of the NYBCL set forth above, the Purchaser does not
believe that any such takeover statutes are applicable to the Offer or the
Merger and has not attempted to comply with any such state takeover statutes in
connection therewith. The Purchaser reserves the right to challenge the validity
or applicability of any state law allegedly applicable to the Offer or the
Merger and nothing in this Offer to Purchase nor any action taken in connection
herewith is intended as a waiver of that right.
Antitrust. Under the HSR Act and the rules that have been promulgated
thereunder, certain acquisition transactions may not be consummated unless
certain information has been furnished to the Antitrust Division of the
Department of Justice (the "Antitrust Division") and the FTC (the "FTC") and
certain waiting period requirements have been satisfied.
On December 16, 1997, the Parent filed a Premerger Notification and
Report Form with the Federal Trade Commission and the Antitrust Division under
the HSR Act with respect to the Initial Tender Offer. On Monday, January 5,
1998, the Parent was informed by the FTC that early termination of the waiting
period under the HSR Act applicable to the purchase of the Shares pursuant to
such offer had been granted. Such notice also applies to the Offer and the
Merger.
16. FEES AND EXPENSES.
The Purchaser has retained Innisfree M&A Incorporated to act as the
Information Agent in connection with the Offer. The Information Agent may
contact holders of Shares by mail, telephone, facsimile, telegraph and personal
interviews and may request brokers, dealers and other nominee shareholders to
forward materials relating to the Offer to beneficial owners of Shares. The
Information Agent will receive reasonable and customary compensation for its
services, will be reimbursed for certain reasonable out-of-pocket expenses and
will be indemnified against certain liabilities and expenses in connection
therewith, including certain liabilities under the federal securities laws.
In addition, Harris Trust Company of New York has been retained as the
Depositary. The Depositary has not been retained to make solicitations or
recommendations in its role as Depositary. The Depositary will receive
reasonable and customary compensation for its services, will be reimbursed for
certain reasonable out-of-pocket expenses and will be indemnified against
certain liabilities and expenses in connection therewith, including certain
liabilities under the federal securities laws.
The Parent has engaged DLJ to act as its financial advisor and as the
Dealer Manager. Pursuant to a letter agreement dated January 26, 1998, the
Parent has agreed to pay DLJ for its services, including its services as Dealer
Manager, (i) $1,000,000 upon the execution of such letter agreement, and (ii)
$1,000,000 upon the consummation of the business combination, for its services
as financial advisor to the Parent. The Parent has also agreed to reimburse DLJ
for all reasonable expenses, including the reasonable fees and disbursements of
legal counsel in an aggregate amount not to exceed $250,000, and to indemnify
DLJ against liabilities and expenses in connection therewith, including
liabilities under federal securities laws.
-29-
<PAGE>
Except as set forth above, the Purchaser will not pay any fees or
commissions to any broker or dealer or any other person for soliciting tenders
of Shares pursuant to the Offer. Brokers, dealers, commercial banks and trust
companies will, upon request only, be reimbursed by the Purchaser for customary
mailing and handling expenses incurred by them in forwarding material to their
customers.
17. MISCELLANEOUS.
The Purchaser is not aware of any jurisdiction where the making of the
Offer is prohibited by any administrative or judicial action pursuant to any
valid state statute. If the Purchaser becomes aware of any valid state statute
prohibiting the making of the Offer or the acceptance of the Shares pursuant
thereto, the Purchaser will make a good faith effort to comply with such state
statute. If, after such good faith effort, the Purchaser cannot comply with any
such state statute, the Offer will not be made to (nor will tenders be accepted
from or on behalf of) the holders of Shares in such state. In any jurisdiction
where the securities, blue sky or other laws require the Offer to be made by a
licensed broker or dealer, the Offer shall be deemed to be made on behalf of the
Purchaser by one or more registered brokers or dealers which are licensed under
the laws of such jurisdiction.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATION ON BEHALF OF THE PARENT OR THE PURCHASER NOT CONTAINED IN THIS
OFFER TO PURCHASE OR IN THE LETTER OF TRANSMITTAL AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED.
-30-
<PAGE>
The Parent and the Purchaser have filed with the SEC the Schedule
14D-1, pursuant to Rule 14d-3 under the Exchange Act, furnishing certain
additional information with respect to the Offer. The Schedule 14D-1, and any
amendments thereto, may be inspected at, and copies may be obtained from, the
same places and in the same manner as set forth in Section 8 (except that they
will not be available at the regional offices of the SEC).
HN ACQUISITION CORP.
March 6, 1998
-31-
<PAGE>
SCHEDULE I
INFORMATION CONCERNING DIRECTORS AND EXECUTIVE
OFFICERS OF THE PARENT AND THE PURCHASER
Directors and Executive Officers of the Parent. The following table
sets forth the name, business address, present principal occupation, and
employment and material occupations, positions, offices, or employments for the
past five years of certain directors, officers and employees of the Parent.
Unless otherwise indicated, the principal business address of each executive
officer of the Parent is 110 East 59th Street, New York, NY 10022 and each
occupation set forth opposite an individual's name refers to employment with the
Parent. Where no date is given for the commencement of the indicated office or
position, such office or position was assumed prior to March 5, 1993.
Each person listed below is a citizen of the United States.
PRINCIPAL OCCUPATION OR
NAME AND PRINCIPAL EMPLOYMENT; MATERIAL POSITIONS
BUSINESS ADDRESS HELD DURING THE PAST FIVE YEARS
- ------------------------------- -----------------------------------------
Neil D. Arnold................. Director. Group Finance Director since
Varity Corporation December 1996 and Executive Vice
672 Delaware Avenue President, Corporate Development from
Buffalo, NY 14209 April 1996 through December 1996 of Lucas
Varity plc, Senior Vice President and
Chief Financial Officer from July 1990
through April 1996 of Varity Corporation.
Lucas Varity plc designs, manufactures
and supplies advanced technology systems,
products and services in the world's
automotive, diesel engine and aerospace
industries.
James H. Bischoff............. Vice President - Commercial since August
1997. Mr. Bischoff was previously
employed as Vice President- Sales and
Marketing for Quanex Corporation since
1993. Prior to 1993, Mr. Bischoff was
employed by Bethlehem Steel Corporation
for 32 years, most recently as District
Sales Manager.
Paul W. Bucha................... Director. President, Paul W. Bucha &
Paul W. Bucha and Company, Inc. Company, Inc., an international marketing
Foot of Chapel Avenue consulting firm; President, BLHJ, Inc.,
Jersey City, NJ 07305 an international consulting firm;
President, Congressional Medal of Honor
Society of U.S. since September 1995.
Robert A. Davidow............... Director. Private Investor; Director,
11601 Wilshire Boulevard Arden Group, Inc.
Suite 1940
Los Angeles, CA 90025
William Goldsmith............... Director. Management and Marketing
Fiber Fuel International, Inc. Consultant; Chairman and Chief Executive
221 Executive Circle Officer of Overspin Golf, since January
Suite II 1994; Chairman of the Board and Chief
Savannah, GA 31406 Executive Officer of Fiber Fuel
International, Inc., since 1994.
-32-
<PAGE>
PRINCIPAL OCCUPATION OR
NAME AND PRINCIPAL EMPLOYMENT; MATERIAL POSITIONS
BUSINESS ADDRESS HELD DURING THE PAST FIVE YEARS
- ------------------------------- -----------------------------------------
Ronald LaBow.................. Director. Chairman of the Board;
President, Stonehill Investment Corp.;
Director of Regency Equities Corp., a
real estate company.
Howard Mileaf................. Vice President, Special Counsel since
April 1993; Trustee/Director of Neuberger
& Berman Equity Mutual Funds.
Paul J. Mooney................ Chief Financial Officer; Executive Vice
President - Finance of the Company and
Wheeling-Pittsburgh Steel Corporation
("WPSC") since November 1997. Prior to
joining the Company Mr. Mooney was a
partner with Price Waterhouse LLP.
James E. Muldoon.............. Vice President - Purchasing since October
1997. Mr. Muldoon was previously employed
with U.S. Steel Group of USX Corporation
for 34 years, most recently as General
Manager of Purchasing.
Marvin L. Olshan............. Director. Secretary; Partner, Olshan
Olshan Grundman Frome & Grundman Frome & Rosenzweig LLP.
Rosenzweig LLP
505 Park Avenue
New York, NY 10022
John R. Scheessele........... Director, President and Chief Executive
Officer; President, Chief Executive
Officer and Chairman of the Board of
WPSC.
Garen Smith................. Vice President since October 1995;
President and Chief Executive Offer of
Unimast Incorporated, a wholly- owned
subsidiary of WHX.
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<PAGE>
PRINCIPAL OCCUPATION OR
NAME AND PRINCIPAL EMPLOYMENT; MATERIAL POSITIONS
BUSINESS ADDRESS HELD DURING THE PAST FIVE YEARS
- ------------------------------- -----------------------------------------
Raymond S. Troubh.............. Director. Financial Consultant; Director
10 Rockefeller Plaza of ADT Limited, a provider of electronic
Suite 712 security alarm protection, America West
New York, NY 10021 Airlines, Inc., Applied Power Inc., a
manufacturer and distributor of hydraulic
power equipment, ARIAD Pharmaceuticals,
Inc., Becton, Dickinson and Company, a
medical instrumentation and equipment
company, Diamond Offshore Drilling, Inc.,
Foundation Health Systems, Inc., General
American Investors Company, Olsten
Corporation, a temporary help company,
Petrie Stores Corporation, a retail
chain, Time Warner Inc. and Triarc
Companies, Inc.
-34-
<PAGE>
Directors and Officers of the Purchaser. Set forth below are the name
and position with the Purchaser of each director of the Purchaser. The principal
address of the Purchaser and the current business address of each individual
listed below is 110 East 59th Street, New York, NY 10022. Each such person is a
citizen of the United States. The present principal occupation or employment (in
addition to the position with the Purchaser indicated below), and material
occupations, positions, offices or employments for the past five years of
Messrs. Tabin and Trangucci are set forth below. Information with respect to Mr.
LaBow, who is also a Director and executive officer of the Parent, is set forth
above in "Directors and Executive Officers of the Parent".
PRESENT POSITION
WITH THE PURCHASER AND PRINCIPAL OCCUPATION
OR EMPLOYMENT; MATERIAL POSITIONS HELD DURING
NAME THE PAST FIVE YEARS
- ----------------------------- ----------------------------------------------
Ronald LaBow................. Director; President
Stewart E. Tabin............. Director; Vice-President; and Secretary;
Assistant Treasurer of the Parent; Vice
President of Stonehill Investment Corp.
Neale X. Trangucci........... Treasurer; Assistant Treasurer of the Parent;
Vice President of Stonehill Investment Corp.
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<PAGE>
SCHEDULE II
TRANSACTIONS IN THE SECURITIES OF THE COMPANY
The following table sets forth the transactions in Shares by the
Parent, the Purchaser and their affiliates and includes all transactions that
occurred during the past 60 days. Unless otherwise indicated, all such
transactions took place on the NYSE.
Shares of Common Stock Purchase Price Per Share Date of Purchase
- ------------------------- -------------------------- ----------------
25,000 $17.50 August 1, 1997
12,000 $18.69 August 8, 1997
3,000 $19.00 August 11, 1997
11,400 $19.00 August 14, 1997
3,000 $19.00 August 15, 1997
1,500 $19.00 August 18, 1997
6,400 $19.50 August 21, 1997
16,300 $19.25 August 22, 1997
30,000 $19.68 August 26, 1997
10,000 $19.25 August 27, 1997
30,400 $19.98 August 28, 1997
40,100 $20.63 August 29, 1997
25,400 $20.42 September 2, 1997
8,500 $20.60 September 3, 1997
41,200 $20.85 September 4, 1997
11,400 $20.99 September 5, 1997
31,800 $21.10 September 8, 1997
25,100 $23.98 October 10, 1997
21,900 $24.03 October 14, 1997
8,000 $24.31 October 15, 1997
23,800 $25.04 October 16, 1997
21,200 $25.71 October 16, 1997
32,800 $26.36 October 22, 1997
45,800 $26.86 October 23, 1997
15,400 $27.19 October 24, 1997
29,500 $25.60 October 30, 1997
5,100 $24.25 October 31, 1997
10,000 $25.00 November 6, 1997
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<PAGE>
Shares of Common Stock Purchase Price Per Share Date of Purchase
- ------------------------- -------------------------- ----------------
10,000 $25.25 November 13, 1997
15,000 $23.50 November 21, 1997
5,000 $23.00 November 24, 1997
10,000 $22.63 November 28, 1997
425,0521 $30.00 January 16, 1998
338,403 $35.13 January 26, 1998
300,000 $35.13 January 26, 1998
- --------
1 Shares purchased pursuant to the Initial Tender Offer of Parent commenced on
December 16, 1997.
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<PAGE>
Manually executed facsimile copies of the Letter of Transmittal,
properly completed and duly signed, will be accepted. The Letter of Transmittal,
certificates for the Shares and any other required documents should be sent by
each shareholder of the Company or his broker, dealer, commercial bank, trust
company or other nominee to the Depositary at one of its addresses set forth
below:
The Depositary for the Offer is:
HARRIS TRUST COMPANY OF NEW YORK
By Mail: By Hand/Overnight Deliver:
Wall Street Station Receive Window
P.O. Box 1023 Wall Street Plaza
New York, NY 10268-1023 88 Pine Street, 19th Floor
New York, NY 10005
By Facsimile Transmission:
(for Eligible Institutions Only)
(212) 701-7636
For Information (call collect):
(212) 701-7624
Any questions or requests for assistance or additional copies of the
Offer to Purchase, the Letter of Transmittal and the Notice of Guaranteed
Delivery may be directed to the Information Agent or the Dealer Manager at their
respective addresses and telephone numbers set forth below. You may also contact
your broker, dealer, commercial bank or trust company or other nominee for
assistance concerning the Offer.
The Information Agent for the Offer is:
INNISFREE M&A INCORPORATED
501 Madison Avenue, 20th Floor
New York, New York 10022
Telephone: (212) 750-5833
or
CALL TOLL FREE: (888) 750-5834
The Dealer Manager for the Offer is:
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
2121 Avenue of the Stars, Suite 3000
Los Angeles, California 90067
Telephone: (310) 282-6161
or
CALL TOLL FREE (800) 237-5022, EXT. 6174
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 MARCH 6, 1998
BY
HN ACQUISITION CORP.
A WHOLLY-OWNED SUBSIDIARY OF
WHX CORPORATION
- --------------------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00
MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY, APRIL 2, 1998,
UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
THE DEPOSITARY FOR THE OFFER IS:
HARRIS TRUST COMPANY OF NEW YORK
By Mail: By Hand/Overnight Delivery:
Wall Street Station Receive Window
P.O. Box 1023 Wall Street Plaza
New York, NY 10268-1023 88 Pine Street, 19th Floor
New York, NY 10005
By Facsimile Transmission:
(for Eligible Institutions Only)
(212) 701-7636 or 7637
For Information Telephone (call collect):
(212) 701-7624
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE OR TELEX TRANSMISSION
OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. YOU MUST
SIGN THIS LETTER OF TRANSMITTAL WHERE INDICATED BELOW AND COMPLETE THE
SUBSTITUTE FORM W-9 PROVIDED BELOW.
The instructions accompanying this Letter of Transmittal should be read
carefully before this letter of transmittal is completed.
This Letter of Transmittal is to be completed by the shareholders of
Handy & Harman either if certificates evidencing Shares (as defined below) are
to be forwarded herewith, or if delivery of Shares is to be made by book-entry
transfer to the Depositary's account at the Depository Trust Company or the
Philadelphia Depository Trust Company (each a "Book-Entry Transfer Facility")
pursuant to the book-entry transfer procedure described in "Procedures for
Tendering Shares" of the Offer to Purchase (as defined below). DELIVERY OF
DOCUMENTS TO A BOOK-ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE DELIVERY TO THE
DEPOSITARY. Unless the Rights are redeemed,
<PAGE>
holders of Shares will also be required to tender one Right for each Share
tendered in order to effect a valid tender of such Shares.
Shareholders whose certificates are not immediately available or who
cannot deliver their certificates for Shares and all other required documents to
the Depositary before the Expiration Date (as defined in the Offer to Purchase)
or whose Shares cannot be delivered on a timely basis pursuant to the procedure
for book-entry transfer must tender their Shares according to the guaranteed
delivery procedure set forth in Section 3 of the Offer to Purchase. See
Instruction 2.
/ / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY
TRANSFER TO THE DEPOSITARY'S ACCOUNT AT ONE OF THE BOOK-ENTRY TRANSFER
FACILITIES AND COMPLETE THE FOLLOWING:
Name of Tendering Institution:_________________________________________
CHECK BOX OF APPLICABLE BOOK-ENTRY TRANSFER FACILITY:
/ / DTC / / PDTC
Account Number:_________________________________________________________________
Transaction Code Number:________________________________________________________
/ / CHECK HERE IF TENDERED SHARES ARE BEING TENDERED PURSUANT TO A NOTICE
OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE
THE FOLLOWING:
Name(s) of Registered Holder(s):_______________________________________
Window Ticket Number (if any):_________________________________________
Date of Execution of Notice of Guaranteed Delivery:
Name of Institution which Guaranteed Delivery:_________________________
IF DELIVERED BY BOOK-ENTRY TRANSFER, CHECK BOX OF BOOK-ENTRY TRANSFER
FACILITY:
/ / DTC / / PDTC
Account Number:_________________________________________________________________
Transaction Code Number:________________________________________________________
-2-
<PAGE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
- -----------------------------------------------------------------------------------------------------------------------------
Name(s) and Address(es) of Registered Holder(s) Share Certificate(s) Tendered
(Please fill in, if blank) (Attach additional list if necessary)
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Total Number of Number of
Certificate Shares Represented Shares
Number(s)* By Certificate(s)* Tendered**
- -----------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------
---------------------------------------------------------------------
---------------------------------------------------------------------
---------------------------------------------------------------------
---------------------------------------------------------------------
---------------------------------------------------------------------
Total Shares
- -----------------------------------------------------------------------------------------------------------------------------
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares being delivered to the Depositary are being tendered.
See Instruction 4.
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
The names and addresses of the registered holders should be printed, if
not already printed above, exactly as they appear on the certificates
representing Shares tendered hereby. The certificates and number of
Shares that the undersigned wishes to tender should be indicated in the
appropriate boxes.
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE INSTRUCTIONS SET FORTH IN THIS LETTER OF TRANSMITTAL
CAREFULLY.
-3-
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to HN Acquisition Corp., a New York
corporation ("Purchaser") and a wholly owned subsidiary of WHX Corporation, a
Delaware corporation, the above described shares of common stock, par value
$1.00 per share (the "Shares") of Handy & Harman, a New York corporation (the
"Company"), including the associated Common Stock Purchase Rights (the "Rights")
issued pursuant to the Rights Agreement, dated as of January 26, 1989, as
amended on April 25, 1996, October 22, 1996 and March 1, 1998, between the
Company and ChaseMellon Shareholder Services L.L.C., as Rights Agent, at a price
of $35.25 per Share, net to the seller in cash, without interest thereon (the
"Offer Price"), upon the terms and subject to the conditions set forth in the
Offer to Purchase, dated March 6, 1998 (the "Offer to Purchase"), and in this
Letter of Transmittal (which, as amended from time to time, together constitute
the "Offer"). Unless the Rights are redeemed by the Company, a tender of the
Shares will also constitute a tender of the associated Rights. Unless the
context requires otherwise, all references herein to the Shares shall include
the associated Rights, and all references to the Rights shall include all
benefits that may inure to the holders of the Rights pursuant to the Rights
Agreement.
Subject to, and effective upon, acceptance for payment of the Shares
tendered herewith, in accordance with the terms of the Offer (including, if the
Offer is extended or amended, the terms and conditions of any such extension or
amendment), the undersigned hereby sells, assigns and transfers to, or upon the
order of, Purchaser all right, title and interest in and to all the Shares that
are being tendered hereby (and any and all non-cash dividends, distributions,
rights, other Shares or other securities issued or issuable in respect thereof
or declared, paid or distributed in respect of such Shares on or after March 6,
1998 (collectively, "Distributions")), purchased pursuant to the Offer and
irrevocably appoints the Depositary the true and lawful agent and
attorney-in-fact of the undersigned with respect to such Shares and all
Distributions, with full power of substitution (such power of attorney being
deemed to be an irrevocable power coupled with an interest), to (i) deliver
certificates for such Shares (individually, a "Share Certificate") and all
Distributions, or transfer ownership of such Shares and all Distributions on the
account books maintained by the Book-Entry Transfer Facility, together, in
either case, with all accompanying evidence of transfer and authenticity to, or
upon the order of Purchaser, (ii) present such Shares and all Distributions for
transfer on the books of the Company, and (iii) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Shares and all
Distributions, all in accordance with the terms of the Offer.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, sell, assign and transfer the Shares
tendered hereby and all Distributions, that the undersigned own(s) the Shares
tendered hereby and that, when such Shares are accepted for payment by
Purchaser, Purchaser will acquire good, marketable and unencumbered title
thereto and to all Distributions, free and clear of all liens, restrictions,
charges and encumbrances, and that none of such Shares and Distributions will be
subject to any adverse claim. The undersigned, upon request, shall execute and
deliver all additional documents deemed by the Depositary or Purchaser to be
necessary or desirable to complete the sale, assignment and transfer of the
Shares tendered hereby and all Distributions. In addition, the undersigned shall
remit and transfer promptly to the Depositary for the account of Purchaser all
Distributions in respect of the Shares tendered hereby, accompanied by
appropriate documentation of transfer, and, pending such remittance and transfer
or appropriate assurance thereof, Purchaser shall be entitled to all rights and
privileges as owner of each such Distribution and may withhold the entire
purchase price of the Shares tendered hereby or deduct from such purchase price,
the amount or value of such Distribution as determined by Purchaser in its sole
discretion. The undersigned further represents and warrants that the undersigned
has read and agrees to all terms of the Offer.
No authority herein conferred or agreed to be conferred shall be
affected by, and all such authority shall survive, the death or incapacity of
the undersigned. All obligations of the undersigned hereunder shall be binding
upon the heirs, executors, personal and legal representatives, administrators,
trustees in bankruptcy, successors and assigns of the undersigned. Except as
stated in the Offer to Purchase, this tender is irrevocable.
The undersigned understands that tenders of Shares pursuant to any one
of the procedures described in "Procedures for Tendering Shares" of the Offer to
Purchase and in the Instructions hereto will constitute the
-4-
<PAGE>
undersigned's acceptance of the terms and conditions of the Offer. Purchaser's
acceptance for payment of Shares tendered pursuant to the Offer will constitute
a binding agreement between the undersigned and Purchaser upon the terms and
subject to the conditions of the Offer. The undersigned recognizes that under
certain circumstances set forth in the Offer to Purchase, Purchaser may not be
required to accept for payment any of the Shares tendered hereby.
Unless otherwise indicated herein in the box entitled "Special Payment
Instructions," please issue the check for the purchase price and/or return any
certificates evidencing Shares not tendered or accepted for payment, in the
name(s) of the registered holder(s) appearing above under "Description of Shares
Tendered." Similarly, unless otherwise indicated in the box entitled "Special
Delivery Instructions," please mail the check for the purchase price and/or
return any certificates evidencing Shares not tendered or accepted for payment
(and accompanying documents, as appropriate) to the address(es) of the
registered holder(s) appearing above under "Description of Shares Tendered." In
the event that the box entitled "Special Payment Instructions" and/or "Special
Delivery Instructions" are completed, please issue the check for the purchase
price and/or return any certificates for Shares not purchased or not tendered or
accepted for payment in the name(s) of, and/or mail such check and/or return
such certificates to, the person(s) so indicated. Unless otherwise indicated
herein in the box entitled "Special Payment Instructions," please credit any
Shares tendered hereby and delivered by book-entry transfer, but which are not
purchased, by crediting the account at the Book-Entry Transfer Facility
designated above. The undersigned recognizes that Purchaser has no obligation,
pursuant to the Special Payment Instructions, to transfer any Shares from the
name of the registered holder(s) thereof if Purchaser does not accept for
payment any of the Shares tendered hereby.
-5-
<PAGE>
- ----------------------------------- ----------------------------------
SPECIAL PAYMENT INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5, 6 AND 7 (SEE INSTRUCTIONS 1, 5, 6 AND 7
OF THIS LETTER OF TRANSMITTAL) OF THIS LETTER OF TRANSMITTAL)
To be completed ONLY if certificates To be completed ONLY if
for Shares not tendered or not purchased certificates for Shares not
and/or the check for the purchase price tendered or not purchased and/or
of Shares purchased are to be issued in the check for the purchase price
the name of someone other than the of Shares purchased are to be sent
undersigned. to someone other than the
undersigned, or to the undersigned
at an address other than that
shown above.
Issue check and/or certificates to:
Name:_____________________________
(PLEASE PRINT) Mail check and/or certificates to:
Address:__________________________ Name:_____________________________
(Include Zip Code) (PLEASE PRINT)
__________________________________ Address:__________________________
Taxpayer Identification or Social (INCLUDE ZIP CODE)
Security Number (See Substitute
Form W-9 on reverse)
__________________________________ __________________________________
-6-
<PAGE>
SIGN HERE
(COMPLETE SUBSTITUTE FORM W-9 ON REVERSE)
-----------------------------------
(SIGNATURE(S) OF HOLDER(S)
Dated: _____________, 1998
(Must be signed by registered holder(s) exactly as name(s) appear(s) on share
certificate(s) or on a security position listing or by person(s) authorized to
become registered holder(s) by certificates and documents transmitted herewith.
If signature is by trustees, executors, administrators, guardians,
attorneys-in-fact, officers of corporations or others acting in a fiduciary or
representative capacity, please provide the following information. See
Instruction 5 of this Letter of Transmittal.)
Name(s):________________________________________________________________________
(PLEASE PRINT)
Capacity (full title):__________________________________________________________
Address:________________________________________________________________________
(INCLUDE ZIP CODE)
Area Code and Telephone Number:_________________________________________________
Tax Identification or Social Security Number:___________________________________
(COMPLETE SUBSTITUTE FORM W-9 ON REVERSE)
-7-
<PAGE>
GUARANTEE OF SIGNATURE(S)
(SEE INSTRUCTIONS 1 AND 5 OF THIS LETTER OF TRANSMITTAL)
Authorized Signature:___________________________________________________________
Name:___________________________________________________________________________
(PLEASE PRINT)
Title:__________________________________________________________________________
Name of Firm:___________________________________________________________________
Address:________________________________________________________________________
(INCLUDE ZIP CODE)
Area Code and Telephone Number:_________________________________________________
Dated: ________________, 1998
-8-
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. Guarantee of Signatures. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a firm which is a
bank, broker, dealer, credit union, savings association, or other entity that is
a member in good standing of the Securities Transfer Agents Medallion Program
(each, an "Eligible Institution"). No signature guarantee is required on this
Letter of Transmittal (i) if this Letter of Transmittal is signed by the
registered holder(s) (which term, for purposes of this document, shall include
any participant in the Book-Entry Transfer Facility whose name appears on a
security position listing as the owner of Shares) of Shares tendered herewith,
unless such holder(s) has completed either the box entitled "Special Delivery
Instructions" or the box entitled "Special Payment Instructions" included
herein, or (ii) if such Shares are tendered for the account of an Eligible
Institution. See Instruction 5.
2. Delivery of Letter of Transmittal and Share Certificates; Guaranteed
Delivery Procedures. This Letter of Transmittal is to be used either if
certificates evidencing Shares ("Certificates") are to be forwarded herewith or
if Shares are to be delivered by book-entry transfer pursuant to the procedure
set forth in "Procedures for Tendering Shares" of the Offer to Purchase.
Certificates evidencing all tendered Shares, or confirmation of a book-entry
transfer of such Shares, if such procedure is available, into the Depositary's
account at a Book-Entry Transfer Facility pursuant to the procedures set forth
in "Procedures for Tendering Shares" of the Offer to Purchase, together with a
properly completed and duly executed Letter of Transmittal (or facsimile
thereof) with any required signature guarantees (or, in the case of a book-entry
transfer, an Agent's Message, as defined below) and any other documents required
by this Letter of Transmittal, must be received by the Depositary at one of its
addresses set forth herein prior to the Expiration Date (as defined in "Terms of
the Offer; Expiration Date" of the Offer to Purchase). If Certificates are
forwarded to the Depositary in multiple deliveries, a properly completed and
duly executed Letter of Transmittal must accompany each such delivery.
Shareholders whose Certificates are not immediately available, who cannot
deliver their Certificates and all other required documents to the Depositary
prior to the Expiration Date or who cannot complete the procedure for delivery
by book-entry transfer on a timely basis may tender their Shares pursuant to the
guaranteed delivery procedure described in "Procedures for Tendering Shares" of
the Offer to Purchase. Pursuant to such procedure: (i) such tender must be made
by or through an Eligible Institution; (ii) a properly completed and duly
executed Notice of Guaranteed Delivery, substantially in the form provided by
Purchaser herewith, must be received by the Depositary prior to the Expiration
Date; and (iii) in the case of a guarantee of Shares, the Certificates, in
proper form for transfer, or a confirmation of a book-entry transfer of such
Shares, if such procedure is available, into the Depositary's account at a
Book-Entry Transfer Facility, together with a properly completed and duly
executed Letter of Transmittal (or manually signed facsimile thereof) with any
required signature guarantees (or, in the case of a book-entry transfer, an
Agent's Message), and any other documents required by this Letter of
Transmittal, must be received by the Depositary within three New York Stock
Exchange, Inc. trading days after the date of execution of the Notice of
Guaranteed Delivery, all as described in "Procedures for Tendering Shares" of
the Offer to Purchase.
THE METHOD OF DELIVERY OF THIS LETTER OF TRANSMITTAL, CERTIFICATES AND ALL OTHER
REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH ANY BOOK-ENTRY TRANSFER FACILITY,
IS AT THE SOLE OPTION AND RISK OF THE TENDERING SHAREHOLDER, AND THE DELIVERY
WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY. IF DELIVERY
IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS
RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY
DELIVERY.
No alternative, conditional or contingent tenders will be accepted and
no fractional Shares will be purchased. By execution of this Letter of
Transmittal (or a facsimile hereof), all tendering shareholders waive any right
to receive any notice of the acceptance of their Shares for payment.
-9-
<PAGE>
3. Inadequate Space. If the space provided herein under "Description of
Shares Tendered" is inadequate, the Certificate numbers, the number of Shares
evidenced by such Certificates and the number of Shares tendered should be
listed on a separate schedule and attached hereto.
4. Partial Tenders. (Not applicable to shareholders who tender by
book-entry transfer.) If fewer than all the Shares evidenced by any Certificate
delivered to the Depositary herewith are to be tendered hereby, fill in the
number of Shares which are to be tendered in the box entitled "Number of Shares
Tendered." In such cases, new Certificate(s) evidencing the remainder of the
Shares that were evidenced by the Certificates delivered to the Depositary
herewith will be sent to the person(s) signing this Letter of Transmittal,
unless otherwise provided in the box entitled "Special Delivery Instructions,"
as soon as practicable after the expiration or termination of the Offer. All
Shares evidenced by Certificates delivered to the Depositary will be deemed to
have been tendered unless otherwise indicated.
5. Signatures on Letter of Transmittal; Stock Powers and Endorsements.
If this Letter of Transmittal is signed by the registered holder(s) of the
Shares tendered hereby, the signature(s) must correspond with the name(s) as
written on the face of the Certificates evidencing such Shares without
alteration, enlargement or any other change whatsoever.
If any Shares tendered hereby are owned of record by two or more
persons, all such persons must sign this Letter of Transmittal.
If any of the Shares tendered hereby are registered in the names of
different holders, it will be necessary to complete, sign and submit as many
separate Letters of Transmittal as there are different registrations of such
certificates.
If this Letter of Transmittal is signed by the registered holder(s) of
the Shares tendered hereby, no endorsements of Certificates or separate stock
powers are required, unless payment is to be made to, or Certificates evidencing
Shares not tendered or not purchased are to be issued in the name of, a person
other than the registered holder(s), in which case, the Certificate(s)
evidencing the Shares tendered hereby must be endorsed or accompanied by
appropriate stock powers, in either case signed exactly as the name(s) of the
registered holder(s) appear(s) on such Certificate(s). Signatures on such
Certificate(s) and stock powers must be guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares tendered hereby, the Certificate(s) tendered
hereby must be endorsed or accompanied by appropriate stock powers, in either
case signed exactly as the name(s) of the registered holder(s) appear(s) on such
Certificate(s). Signatures on such Certificate(s) and stock powers must be
guaranteed by an Eligible Institution.
If this Letter of Transmittal or any Certificate(s) or stock power is
signed by a trustee, executor, administrator, guardian, attorney-in-fact,
officer of a corporation or other person acting in a fiduciary or representative
capacity, such person should so indicate when signing, and proper evidence
satisfactory to Purchaser of such person's authority so to act must be
submitted.
6. Stock Transfer Taxes. Except as otherwise provided in this
Instruction 6, Purchaser will pay all stock transfer taxes with respect to the
sale and transfer of any Shares to it or its order pursuant to the Offer. If,
however, payment of the purchase price of any Shares purchased is to be made to,
or Certificate(s) evidencing Shares not tendered or not purchased are to be
issued in the name of, a person other than the registered holder(s), the amount
of any stock transfer taxes (whether imposed on the registered holder(s), such
other person or otherwise) payable on account of the transfer to such other
person will be deducted from the purchase price of such Shares purchased, unless
evidence satisfactory to Purchaser of the payment of such taxes, or exemption
therefrom, is submitted. Except as provided in this instruction 6, it will not
be necessary for transfer tax stamps to be affixed to the Certificate(s)
evidencing the Shares tendered hereby.
-10-
<PAGE>
7. Special Payment and Delivery Instructions. If a check for the
purchase price of any Shares tendered hereby is to be issued, or Certificate(s)
evidencing Shares not tendered or not purchased are to be issued, in the name of
a person other than the person(s) signing this Letter of Transmittal or if such
check or any such Certificate is to be sent to someone other than the person(s)
signing this Letter of Transmittal or to the person(s) signing this Letter of
Transmittal but at an address other than that shown in the box entitled
"Description of Shares Tendered," the appropriate boxes on this Letter of
Transmittal must be completed. Shares tendered hereby by book-entry transfer may
request that Shares not purchased be credited to such account maintained at the
Book-Entry Transfer Facility as such shareholder may designate in the box
entitled "Special Payment Instructions" on the reverse hereof. If no such
instructions are given, all such Shares not purchased will be returned by
crediting the account at the Book-Entry Transfer Facility as the account from
which such Shares were delivered.
8. Requests for Assistance or Additional Copies. Requests for
assistance may be directed to the Information Agent or the Dealer Manager at
their respective addresses or telephone numbers set forth below. Additional
copies of the Offer to Purchase, this Letter of Transmittal, the Notice of
Guaranteed Delivery and the Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 may be obtained from the
Information Agent, from the Dealer Manager, or from brokers, dealers, commercial
banks or trust companies.
9. Substitute Form W-9. Each tendering shareholder is required to
provide the Depositary with a correct Taxpayer Identification Number ("TIN") on
the Substitute Form W-9 which is provided under "Important Tax Information"
below, and to certify, under penalties of perjury, that such number is correct
and that such shareholder is not subject to backup withholding of federal income
tax. If a tendering shareholder has been notified by the Internal Revenue
Service that such shareholder is subject to backup withholding, such shareholder
must cross out item (2) of the Certification box of the Substitute Form W-9,
unless such shareholder has since been notified by the Internal Revenue Service
that such shareholder is no longer subject to backup withholding. Failure to
provide the information on the Substitute Form W-9 may subject the tendering
shareholder to 31% federal income tax withholding on the payment of the purchase
price of all Shares purchased from such shareholder. If the tendering
shareholder has not been issued a TIN and has applied for one or intends to
apply for one in the near future, such shareholder should write "Applied For" in
the space provided for the TIN in Part I of the Substitute Form W-9, and sign
and date the Substitute Form W-9. If "Applied For" is written in Part I and the
Depositary is not provided with a TIN within 60 days, the Depositary will
withhold 31% on all payments of the purchase price to such shareholder until a
TIN is provided to the Depositary.
10. Lost, Destroyed or Stolen Certificates. If any certificate(s)
representing Shares has been lost, destroyed or stolen, the shareholder should
promptly notify the Depositary. The shareholder will then be instructed as to
the steps that must be taken in order to replace the certificate(s). This Letter
of Transmittal and related documents cannot be processed until the procedures
for replacing lost or destroyed certificates have been followed.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A FACSIMILE HEREOF), PROPERLY
COMPLETED AND DULY EXECUTED, WITH ANY REQUIRED SIGNATURE GUARANTEES, OR AN
AGENT'S MESSAGE (TOGETHER WITH CERTIFICATES FOR SHARES OR CONFIRMATION OF
BOOK-ENTRY TRANSFER AND ALL OTHER REQUIRED DOCUMENTS) OR, IF APPLICABLE, A
PROPERLY COMPLETED AND DULY EXECUTED NOTICE OF GUARANTEED DELIVERY MUST BE
RECEIVED BY THE DEPOSITARY PRIOR TO THE EXPIRATION DATE.
-11-
<PAGE>
IMPORTANT TAX INFORMATION
Under the federal income tax law, a shareholder whose tendered Shares
are accepted for payment is required by law to provide the Depositary (as payer)
with such shareholder's correct TIN on Substitute Form W-9 below. If such
shareholder is an individual, the TIN is such shareholder's social security
number. If the Depositary is not provided with the correct TIN, the shareholder
may be subject to a $50 penalty imposed by the Internal Revenue Service. In
addition, payments that are made to such shareholder with respect to Shares
purchased pursuant to the Offer may be subject to backup withholding of 31%.
Certain shareholders (including, among others, all corporations and
certain foreign individuals) are not subject to these backup withholding and
reporting requirements. In order for a foreign individual to qualify as an
exempt recipient, such individual must submit a statement, signed under
penalties of perjury, attesting to such individual's exempt status. Forms of
such statements can be obtained from the Depositary. See the enclosed Guidelines
for Certification of Taxpayer Identification Number on Substitute Form W-9 for
additional instructions.
If backup withholding applies with respect to a shareholder, the
Depositary is required to withhold 31% of any payments made to such shareholder.
Backup withholding is not an additional tax. Rather, the tax liability of
persons subject to backup withholding will be reduced by the amount of tax
withheld. If withholding results in an overpayment of taxes, a refund may be
obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9
To prevent backup withholding on payments that are made to a
shareholder with respect to Shares purchased pursuant to the Offer, the
shareholder is required to notify the Depositary of such shareholder's correct
TIN by completing the form below certifying (a) that the TIN provided on
Substitute Form W-9 is correct (or that such shareholder is awaiting a TIN), and
(b) that (i) such shareholder has not been notified by the Internal Revenue
Service that such shareholder is subject to backup withholding as a result of a
failure to report all interest or dividends or (ii) the Internal Revenue Service
has notified such shareholder that such shareholder is no longer subject to
backup withholding.
WHAT NUMBER TO GIVE THE DEPOSITARY
The shareholder is required to give the Depositary the social security
number or employer identification number of the record holder of the Shares
tendered hereby. If the Shares are in more than one name or are not in the name
of the actual owner, consult the enclosed Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9 for additional guidance on
which number to report. If the tendering shareholder has not been issued a TIN
and has applied for a number or intends to apply for a number in the near
future, the shareholder should write "Applied For" in the space provided for the
TIN in Part I, and sign and date the Substitute Form W-9. If "Applied For" is
written in Part I and the Depositary is not provided with a TIN within 60 days,
the Depositary will withhold 31% of all payments of the purchase price to such
shareholder until a TIN is provided to the Depositary.
-12-
<PAGE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
PAYER'S NAME: HARRIS TRUST COMPANY OF NEW YORK, AS DEPOSITARY
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
SUBSTITUTE PART I--PLEASE PROVIDE YOUR TIN IN THE BOX AT
FORM W-9 RIGHT AND CERTIFY BY SIGNING AND DATING BELOW. Social Security Number
Department of the Treasury OR
Internal Revenue Service
Employer Identification
Number
(If awaiting TIN write
"Applied For")
- ------------------------------------------------------------------------------------------------------------------------------------
Payer's Request for PART II--For Payees Exempt From Backup Withholding, see the enclosed Guidelines and complete as
instructed therein.
Taxpayer Identification
Number (TIN) CERTIFICATION--Under penalties of perjury, I certify that:
(1) The number shown on this form is my correct Taxpayer Identification Number (or a
Taxpayer Identification Number has not been issued to me and either (a) I have mailed
or delivered an application to receive a Taxpayer Identification Number to the
appropriate Internal Revenue Service ("IRS") or Social Security administration office
or (b) I intend to mail or deliver an application in the near future. I understand
that if I do not provide a Taxpayer Identification Number within sixty (60) days, 31%
of all reportable payments made to me thereafter will be withheld until I provide a
number), and
(2) I am not subject to backup withholding because (a) I am exempt from backup
withholding, (b) I have not been notified by the IRS that I am subject to backup
withholding as a result of failure to report all interest or dividends or (c) the IRS
has notified me that I am no longer subject to backup withholding.
CERTIFICATE INSTRUCTIONS--You must cross out item (2) above if you have been notified by the
IRS that you are subject to backup withholding because of under reporting interest or dividends
on your tax return. However, if after being notified by the IRS that you were subject to backup
withholding you received another notification from the IRS that you are no longer subject to
backup withholding, do not cross out item (2). (Also see instructions in the enclosed
Guidelines.)
- ------------------------------------------------------------------------------------------------------------------------------------
SIGNATURE:_______________________________________________________ DATE: , 1998
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER.
PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
The Information Agent for the Offer is:
INNISFREE M&A INCORPORATED
501 Madison Avenue, 20th Floor
New York, New York 10022
(212) 750-5833
or
CALL TOLL FREE: (888) 750-5834
The Dealer Manager for the Offer is:
DONALDSON, LUFKIN & JENRETTE SECURITIES CORP.
2121 Avenue of the Stars, Suite 3000
Los Angeles, California 90067
(310) 282-6161
or
CALL TOLL FREE: (800) 237-5022, EXT. 6174
-13-
NOTICE OF GUARANTEED DELIVERY
FOR
TENDER OF SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS)
OF
HANDY & HARMAN
TO
HN ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
WHX CORPORATION
(NOT TO BE USED FOR SIGNATURE GUARANTEES)
As set forth in Section 3 of the Offer to Purchase (as defined below),
this form, or a form substantially equivalent to this form, must be used to
accept the Offer (as defined below) if the certificates representing shares of
common stock, par value $1.00 per share of Handy & Harman (the "Shares"), are
not immediately available or time will not permit all required documents to
reach the Depositary prior to the Expiration Date (as defined in the Offer to
Purchase) or the procedures for book-entry transfer cannot be completed on a
timely basis. Such form may be delivered by hand or transmitted by telegram,
facsimile transmission or mail to the Depositary and must include a guarantee by
an Eligible Institution (as defined in Section 3 of the Offer to Purchase). See
Section 3 of the Offer to Purchase.
The Depositary for the Offer is:
HARRIS TRUST COMPANY OF NEW YORK
By Mail: By Hand/Overnight Delivery:
Wall Street Station Receive Window
P.O. Box 1023 Wall Street Plaza
New York, NY 10268-1023 88 Pine Street, 19th Floor
New York, NY 10005
By Facsimile Transmission:
(for Eligible Institutions Only)
(212) 701-7636 or 7637
For Information Telephone (call collect):
(212) 701-7624
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE, OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE TRANSMISSION
OTHER THAN AS SET FORTH ABOVE, WILL NOT CONSTITUTE A VALID DELIVERY.
This form is not to be used to guarantee signatures. If a signature on
a Letter of Transmittal is required to be guaranteed by an "Eligible
Institution" under the instructions thereto, such signature guarantee must
appear in the applicable space provided in the signature box on the Letter of
Transmittal.
<PAGE>
LADIES AND GENTLEMEN:
The undersigned hereby tenders to HN Acquisition Corp., a New York
corporation and a wholly owned subsidiary of WHX Corporation, a Delaware
corporation, upon the terms and subject to the conditions set forth in the Offer
to Purchase, dated March 6, 1998 (the "Offer to Purchase"), and the related
Letter of Transmittal (which, as amended from time to time, together constitute
the "Offer"), receipt of each of which is hereby acknowledged, the number of
Shares specified below pursuant to the guaranteed delivery procedures described
in "Procedures for Tendering Shares" of the Offer to Purchase.
-2-
<PAGE>
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
- -------------------------------------------- -------------------------------
Number of Shares:___________________________ Name(s) of Record Holder(s):
Share Certificate Numbers (if available): _______________________________
PLEASE TYPE OR PRINT
Address(es)____________________
/ / Check here if Shares will be delivered _______________________________
by book-entry transfer. Zip Code
Check box of applicable book-entry Area Code and Telephone Number:
transfer facility: _______________________________
_______________________________
/ / DTC / / PDTC _______________________________
_______________________________
SIGNATURE(S)
Account Number ___________________________ Dated:___________________, 1998
Dated:______________________________, 1998
- -------------------------------------------- -------------------------------
The undersigned, a participant in the Security Transfer Agents Medallion
Program (each, an "Eligible Institution"), hereby guarantees that either the
certificates representing the Shares tendered hereby in proper form for
transfer, or timely confirmation of a book-entry transfer of such Shares into
the Depositary's account at The Depository Trust Company or the Philadelphia
Depository Trust Company (pursuant to procedures set forth in Section 3 of the
Offer to Purchase), together with a properly completed and duly executed Letter
of Transmittal (or facsimile thereof) with any required signature guarantees and
any other documents required by the Letter of Transmittal, will be received by
the Depositary at one of its addresses set forth above within three (3) New York
Stock Exchange trading days after the date of execution hereof.
The Eligible Institution that completes this form must communicate the
guarantee to the Depositary and must deliver the Letter of Transmittal and
certificates for Shares and associated Common Stock Purchase Rights to the
Depositary within the time period shown herein. Failure to do so could result in
financial loss to such Eligible Institution.
- -------------------------------------------- -------------------------------
Name of Firm:_______________________________ _______________________________
AUTHORIZED SIGNATURE
Address:____________________________________ Name:__________________________
Zip Code PLEASE TYPE OR PRINT
Title:_________________________
Area Code and
Telephone Number:___________________________ Dated:_________________, 1998
- -------------------------------------------- -------------------------------
NOTE: DO NOT SEND CERTIFICATES FOR SHARES OR ASSOCIATED COMMON STOCK PURCHASE
RIGHTS WITH THIS NOTICE. SUCH CERTIFICATES SHOULD BE SENT WITH YOUR
LETTER OF TRANSMITTAL.
-3-
OFFER TO PURCHASE FOR CASH
ALL OF THE OUTSTANDING SHARES
OF
COMMON STOCK
(INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS)
OF
HANDY & HARMAN
AT
$35.25 NET PER SHARE
BY
HN ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
WHX CORPORATION
- --------------------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00
MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY, APRIL 2,
1998, UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
March 6, 1998
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
We have been engaged by HN Acquisition Corp., a New York corporation
(the "Purchaser") and a wholly owned subsidiary of WHX Corporation, a Delaware
corporation (the "Parent") to act as [Dealer Manager] in connection with the
Purchaser's offer to purchase all of the outstanding shares of Common Stock, par
value $1.00 per share, of Handy & Harman, a New York corporation (the
"Company"), including the associated Common Stock Purchase Rights issued
pursuant to the Rights Agreement, dated as of January 26, 1989, as amended on
April 25, 1996, October 22, 1996 and March 1, 1998, between the Company and
ChaseMellon Shareholder Services LLC, as Rights Agent, at a price of $35.25 per
Share, net to the seller in cash, without interest thereon (the "Offer Price"),
upon the terms and subject to the conditions set forth in the Offer to Purchase,
dated March 6, 1998 (the "Offer to Purchase"), and the related Letter of
Transmittal (which, as amended from time to time, together constitute the
"Offer") enclosed herewith.
For your information and for forwarding to your clients for whom you
hold Shares registered in your name or in the name of your nominee, or who hold
Shares registered in their own names, we are enclosing the following documents:
1. Offer to Purchase, dated March 6, 1998;
2. Letter of Transmittal to be used by holders of shares in
accepting the Offer. Facsimile copies of the Letter of
Transmittal may be used to accept the Offer;
3. Notice of Guaranteed Delivery to be used to accept the Offer
if the certificates evidencing such Shares are not immediately
available or time will not permit all required documents to
reach the Depositary prior to the Expiration Date or the
procedure for book-entry transfer cannot be completed on a
timely basis;
<PAGE>
4. Letter to shareholders of the Company from the Chairman and
Chief Executive Officer of the Company accompanied by a
Solicitation/Recommendation Statement on Schedule 14D-9 filed
with the Securities and Exchange Commission by the Company;
5. A letter which may be sent to your clients for whose accounts
you hold Shares registered in your name or in the name of your
nominees, with space provided for obtaining such clients'
instructions with regard to the Offer;
6. Guidelines of the Internal Revenue Service for Certification
of Taxpayer Identification Number on Substitute Form W-9; and
7. Return envelope addressed to the Depositary.
YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS
AS PROMPTLY AS POSSIBLE. THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00
MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY, APRIL 2, 1998, UNLESS THE OFFER IS
EXTENDED.
The Board of Directors of the Company has unanimously (with one
director absent) approved the Offer and the Merger (as defined below) and
determined that the terms of the Offer and the Merger are fair to, and in the
best interests of, the shareholders of the Company and recommends that
shareholders of the Company accept the Offer and tender their Shares.
The Offer is being made pursuant to the Agreement and Plan of Merger
dated as of March 1, 1998 (the "Merger Agreement"), by and among the Parent, the
Purchaser and the Company pursuant to which, following the consummation of the
Offer and the satisfaction or waiver of certain conditions, the Purchaser will
be merged with and into the Company, with the Company surviving the merger as a
wholly owned subsidiary of the Parent (the "Merger"). In the Merger, each
outstanding Share (other than Shares owned by the Parent, or any subsidiary of
the Parent (including the Purchaser) or Shares held by shareholders exercising
approval rights) will be converted into the right to receive $35.25 per Share,
without interest, as set forth in the Merger Agreement and as described in the
Offer to Purchase.
Payment for Shares accepted for payment pursuant to the Offer will in
all cases be made only after timely receipt by the Depositary of (a)
certificates for (or a timely Book-Entry Confirmation (as defined in the Offer
to Purchase) with respect to) such Shares, (b) a Letter of Transmittal (or
facsimile thereof), properly completed and duly executed, with any required
signature guarantees, or, in the case of a book-entry transfer effected pursuant
to the procedure set forth in Section 2 of the Offer to Purchase, an Agent's
Message (as defined in the Offer to Purchase), and (c) any other documents
required by the Letter of Transmittal. Accordingly, tendering stockholders may
be paid at different times depending upon when certificates for Shares or
Book-Entry Confirmations with respect to Shares are actually received by the
Depositary. UNDER NO CIRCUMSTANCES WILL INTEREST BE PAID ON THE PURCHASE PRICE
OF THE SHARES TO BE PAID BY THE PURCHASER, REGARDLESS OF ANY EXTENSION OF THE
OFFER OR ANY DELAY IN MAKING SUCH PAYMENT.
Neither the Purchaser nor the Company will pay any fees or commissions
to any broker or dealer or other person (other than the Dealer Manager and the
Information Agent as described in the Offer to Purchase) in connection with the
solicitation of tenders of Shares pursuant to the Offer. You will be reimbursed
upon request for customary mailing and handling expenses incurred by you in
forwarding the enclosed offering material to your customers.
-2-
<PAGE>
Questions and requests for additional copies of the enclosed material
may be directed to the Information Agent or to 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,
[DEALER MANAGER]
- --------------------------------------------------------------------------------
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR
ANY OTHER PERSON AS AN AGENT OF PARENT, PURCHASER, THE DEPOSITARY, THE DEALER
MANAGER OR THE INFORMATION AGENT OR ANY AFFILIATE OF ANY OF THE FOREGOING, OR
AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY STATEMENT ON
BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE DOCUMENTS
ENCLOSED AND THE STATEMENTS CONTAINED THEREIN.
- --------------------------------------------------------------------------------
-3-
OFFER TO PURCHASE FOR CASH
ALL OF THE OUTSTANDING SHARES
OF
COMMON STOCK
(INCLUDING THE ASSOCIATED COMMON STOCK RIGHTS)
OF
HANDY & HARMAN
AT
$35.25 NET PER SHARE
BY
HN ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
WHX CORPORATION
- --------------------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00
MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY, APRIL 2, 1998,
UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
March 6, 1998
To Our Clients:
Enclosed for your consideration is an offer to purchase, dated March 6,
1998 (the "offer to purchase") and the related letter of transmittal (which, as
amended from time to time, together constitute the "Offer") in connection with
the offer by HN Acquisition Corp., a New York Corporation ("Purchaser") and a
wholly owned subsidiary of whx corporation, a Delaware corporation ("parent"),
to purchase all of the outstanding shares of Common Stock, par value $1.00 per
share (the "Shares") of Handy & Harman, a New York corporation (the "Company"),
including the associated common stock purchase rights issued pursuant to the
rights agreement, dated as of January 26, 1989, as amended on April 25, 1996,
October 22, 1996 and March 1, 1998, between the company and Chasemellon
Shareholder Services LLC, as rights agent, at a price of $35.25 per share, net
to the seller in cash, without interest thereon, upon the terms and subject to
the conditions set forth in the offer.
The material is being sent to you as the beneficial owner of shares
held by us for your account but not registered in your name. we are the holder
of record of shares held by us for your account. A tender of such shares can be
made only by us as the holder of record and pursuant to your instructions. The
letter of transmittal is furnished to you for your information only and cannot
be used by you to tender shares held by us for your account.
We request instructions as to whether you wish to have us tender on
your behalf any or all of the shares held by us for your account, upon the terms
and subject to the conditions set forth in the offer.
Your attention is invited to the following:
1. The offer price is $35.25 per share, net to the seller in cash,
without interest thereon.
<PAGE>
2. The offer and withdrawal rights will expire at 12:00 midnight, New
York City time, on Thursday, April 2, 1998, unless the offer is
extended.
3. The offer is being made for all of the outstanding shares.
4. The offer is conditioned upon, among other things, there being
validly tendered and not withdrawn prior to the expiration of the
offer that number of shares which, together with the shares then
owned by the parent, the purchaser, or their affiliates, would
represent at least a majority of all outstanding shares on a fully
diluted basis on the date of purchase.
5. Tendering shareholders will not be obligated to pay brokerage fees
or commissions or, except as set forth in instruction 6 of the
letter of transmittal, stock transfer taxes on the purchase of
shares by the purchaser pursuant to the offer. however, federal
income tax backup withholding at a rate of 31% may be required,
unless an exemption is provided or unless the required taxpayer
identification information is provided. See instruction 9 of the
Letter of Transmittal.
The offer is made solely by the offer to purchase and the related
letter of transmittal and is being made to all holders of shares. The purchaser
is not aware of any state where the making of the offer is prohibited by
administrative or judicial action pursuant to any valid state statute. If the
purchaser becomes aware of any valid state statute prohibiting the making of the
offer or the acceptance of shares pursuant thereto, the purchaser will make a
good faith effort to comply with such state statute. if, after such good faith
effort, the purchaser cannot comply with such state statute, the offer will not
be made to (nor will tenders be accepted from or on behalf of) the holders of
shares in such state. In any jurisdiction where the securities, blue sky or
other laws require the offer to be made by a licensed broker or dealer, the
offer shall be deemed to be made on behalf of purchaser by the dealer manager or
one or more registered brokers or dealers licensed under the laws of such
jurisdiction.
If you wish to have us tender any or all of your shares, please so
instruct us by completing, executing and returning to us the instruction form
contained in this letter. an envelope in which to return your instructions to us
is enclosed. if you authorize the tender of your shares, all such shares will be
tendered unless otherwise specified on the instruction form set forth in this
letter. YOUR INSTRUCTIONS SHOULD BE FORWARDED TO US IN AMPLE TIME TO PERMIT US
TO SUBMIT A TENDER ON YOUR BEHALF PRIOR TO THE EXPIRATION OF THE OFFER.
-2-
<PAGE>
INSTRUCTIONS WITH RESPECT TO THE OFFER
TO PURCHASE FOR CASH ALL OF THE OUTSTANDING
SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS)
OF
HANDY & HARMAN
The undersigned acknowledge(s) receipt of your letter, the enclosed
Offer to Purchase, dated March 6, 1998, and the related Letter of Transmittal
(which, as amended from time to time, together constitute the "Offer"), in
connection with the offer by HN Acquisition Corp., a New York corporation
("Purchaser") and a wholly owned subsidiary of WHX Corporation, a Delaware
corporation, to purchase all of the outstanding shares of common stock, par
value $1.00 per share (the "Shares") of Handy & Harman, a New York corporation,
including the associated Common Stock Purchase Rights issued pursuant to the
Rights Agreement, dated as of January 26, 1989, as amended on April 25, 1996,
October 22, 1996 and March 1, 1998, between the Company and ChaseMellon
Shareholder Services LLC, as Rights Agent, at a price of $35.25 per Share, net
to the seller in cash, without interest thereon, upon the terms and subject to
the conditions set forth in the Offer.
This will instruct you to tender to Purchaser the number of Shares
indicated below (or, if no number is indicated in either appropriate space
below, all Shares) held by you for the account of the undersigned, upon the
terms and subject to the conditions set forth in the Offer.
NUMBER OF SHARES TO BE TENDERED:*
________________Shares SIGN HERE
Account Number:_______________ __________________________________
__________________________________
Dated: _____________, 1998 Signature(s)
__________________________________
__________________________________
Please Type or Print Name(s)
__________________________________
__________________________________
Please Type or Print
Address(es) Here
__________________________________
Area Code and Telephone Number
__________________________________
Taxpayer Identification or
Social Security Number(s)
- --------
* Unless otherwise indicated, it will be assumed that all Shares held by
us for your account are to be tendered.
-3-
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
<TABLE>
<CAPTION>
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.
- -----------------------------------------------------------------------------------------------------------------------------------
GIVE THE TAXPAYER GIVE THE TAXPAYER
FOR THIS TYPE OF ACCOUNT: IDENTIFICATION NUMBER OF-- FOR THIS TYPE OF ACCOUNT: IDENTIFICATION NUMBER OF--
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. An individual's account The individual 9. A valid trust, estate, or Legal entity (Do not furnish
pension trust the trust identifying number
of the personal representa-
tive or trustee unless the
legal entity itself is not
designated in the account
title.)(5)
2. Two or more individuals The actual owner of the 10. Corporate account The corporation
(joint account) account or, if combined funds,
any one of the individuals(1)
3. Husband and wife (joint The actual owner of the 11. Religious, charitable,
or The organization account) account or, if joint funds, educational
organization
either person(2) account
4. Custodian account of a The minor(2) 12. Partnership account held The partnership
minor (Uniform Gift to in the name of the
Minors Act) business
5. Adult and minor (joint The adult or, if the minor is 13. Association, club, or The organization
account) the only contributor, the other tax-exempt
minor(1) organization
6. Account in the name of The ward, minor, or 14. A broker or registered The broker or nominee
guardian or committee for incompetent nominee
a designated ward, minor,
or incompetent person(3)
7. a. The usual revocable The grantor-trustee(1) 15. Account with the The public entity
savings trust account Department of
(grantor is also Agriculture in the name
trustee) of a public entity (such as
a State or local
government, school
district, or
prison) that
receives agricultural
program payments
b. So-called trust The actual owner(1)
account that is not a
legal or valid trust
under State law
8. Sole proprietorship The owner(4)
account
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) List first and circle the name of the person whose number you furnish.
(2) Circle the minor's name and furnish the minor's social security number.
(3) Circle the ward's, minor's, or incompetent person's name and furnish such
person's social security number.
(4) Show the name of the owner.
(5) List first and circle the name of the legal trust, estate, or pension trust.
NOTE: If no name is circled when there is more than one name, the number will
be considered to be that of the first name listed.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
OBTAINING A NUMBER
If you do not have a taxpayer identification number or you do not know your
number, obtain Form SS-5, Application for a Social Security Number Card, or Form
SS-4, Application for Employer Identification Number, at the local office of the
Social Security Administration or the Internal Revenue Service and apply for a
number.
PAYEES EXEMPT FROM BACKUP WITHHOLDING
Payees specifically exempted from backup withholding on ALL payments include the
following:
o A corporation.
o A financial institution.
o An organization exempt from tax under section 501(a), or an individual
retirement plan.
o The United States or any agency or instrumentality thereof.
o A State, the District of Columbia, a possession of the United States, or
any subdivision or instrumentality thereof.
o A foreign government, a political subdivision of a foreign government, or
any agency or instrumentality thereof.
o An international organization or any agency or instrumentality thereof. o A
registered dealer in securities or commodities registered in the U.S. or a
possession of the U.S.
o A real estate investment trust.
o A common trust fund operated by a bank under section 584(a). o An exempt
charitable remainder trust, or a non-exempt trust described in section
4947(a)(1).
o An entity registered at all times under the Investment Company Act of 1940.
o A foreign central bank of issue.
Payments of dividends and patronage dividends not generally subject to backup
withholding include the following:
o Payments to nonresident aliens subject to withholding under section
1441.
o Payments to partnerships not engaged in a trade or business in the U.S.
and which have at least one nonresident partner.
o Payments of patronage dividends where the amount received is not paid in
money.
o Payments made by certain foreign organizations.
Payments of interest not generally subject to backup withholding include the
following:
o 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.
o Payments of tax-exempt interest (including exempt-interest dividends under
section 852).
o Payments described in section 6049(b)(5) to nonresident aliens. o Payments
on tax-free covenant bonds under section 1451. o Payments made by certain
foreign organizations.
o Payments of mortgage interest to you.
Exempt payees described above should file Form W-9 to avoid possible erroneous
backup withholding. FILE THIS FORM WITH THE PAYER. FURNISH YOUR TAXPAYER
IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM, AND RETURN IT TO
THE PAYER. IF THE PAYMENTS ARE INTEREST, DIVIDENDS, OR PATRONAGE DIVIDENDS, ALSO
SIGN AND DATE THE FORM.
-2-
<PAGE>
Certain payments other than interest, dividends, and patronage dividends,
that are not subject to information reporting are also not subject to backup
withholding. For details, see the regulations under sections 6041, 6041A(a),
6045, and 6050A.
PRIVACY ACT NOTICE--Section 6109 requires most recipients of dividend, interest,
or other payments to give taxpayer identification numbers to payers who must
report the payments to the IRS. The IRS uses the numbers for identification
purposes. Payers must be given the numbers whether or not recipients are
required to file a tax return. Payers must generally withhold 31% of taxable
interest, dividend, and certain other payments to a payee who does not furnish a
taxpayer identification number to a payer. Certain penalties may also apply.
PENALTIES
(1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER--If you fail
to furnish your taxpayer identification number to a payer, you are subject to a
penalty of $50 for each such failure unless your failure is due to reasonable
cause and not to willful neglect.
(2) FAILURE TO REPORT CERTAIN DIVIDEND AND INTEREST PAYMENTS--If you fail to
include any portion of an includable payment for interest, dividends, or
patronage dividends in gross income, such failure will be treated as being due
to negligence and will be subject to a penalty of 20% on any portion of an
underpayment attributable to that failure unless there is clear and convincing
evidence to the contrary.
(3) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING--If you make
a false statement with no reasonable basis which results in no imposition of
backup withholding, you are subject to a penalty of $500. (4) CRIMINAL PENALTY
FOR FALSIFYING INFORMATION--Falsifying certifications or affirmations may
subject you to criminal penalties including fines and/or imprisonment.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE
SERVICE
-3-
WHX
FOR IMMEDIATE RELEASE
Contracts:
Joele Frank/Patricia Sturms
Abernathy MacGregor Frank
(212) 371-5999
WHX COMMENCES $35.25 PER SHARE CASH TENDER OFFER FOR ALL
OUTSTANDING COMMON SHARES OF HANDY & HARMAN
NEW YORK, NY, MARCH 6, 1998 -- WHX Corporation (NYSE: WHX) announced today that
its wholly-owned subsidiary HN Acquisition Corp. has commenced a tender offer
for all of the outstanding common shares of Handy & Harman (NYSE: HNH) at $35.25
in cash per share. The expiration and withdrawal date for the tender offer is
12:00 midnight, New York City time, on Thursday, April 2, 1998, unless extended.
The tender offer is conditioned on, among other things, the valid tender of such
number of shares which, when added to the 13.6% of the outstanding shares
already owned by WHX, would represent at least a majority of Handy & Harman's
outstanding shares on a fully diluted basis. The tender offer is not subject to
financing or Hart-Scott-Rodino approval. Following completion of the tender
offer, WHX Corporation will be entitled to designate a majority of the Board of
Directors of Handy & Harman. The parties will complete a second-step cash merger
at $35.25 per share as promptly as practicable following completion of the
tender offer.
As previously announced on March 2, 1998, WHX and Handy & Harman entered into a
definitive merger agreement under which WHX will acquire all of the outstanding
common shares of Handy & Harman at $35.25 per share in cash. The transaction has
a total value of approximately $645 million, including the assumption of
approximately $190 million in debt and the cash-out of stock options.
Donaldson, Lufkin & Jenrette Securities Corp. is acting as dealer- manager for
the tender offer, and Innisfree M&A Incorporated is acting as information agent.
Copies of the offering documents may be obtained by calling Innisfree at (888)
750-5834.
# # #
WHX Corporation 110 East 59 Street Tel 212 / 355-5200
New York, NY 10022 Fax 212 / 355-5336
This announcement is neither an offer to purchase nor a solicitation of
an offer to sell Shares (as defined below) or Rights (as defined below). The
Offer (as defined below) is made solely by the Offer to Purchase dated March 6,
1998 and the related Letter of Transmittal and any amendments or supplements
thereto. The Offer is not being made to (nor will tenders be accepted from or on
behalf of) holders of Shares or Rights in any jurisdiction in which the making
of the Offer or the acceptance thereof would not be in compliance with the laws
of such jurisdiction. In those jurisdictions where securities, blue sky or other
laws require the Offer to be made by a licensed broker or dealer, the Offer
shall be deemed to be made on behalf of HN Acquisition Corp. by one or more
registered brokers or dealers licensed under the laws of such jurisdiction.
NOTICE OF OFFER TO PURCHASE FOR CASH
ALL OF THE OUTSTANDING SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS)
OF
HANDY & HARMAN
AT $35.25 PER SHARE
BY
HN ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
WHX CORPORATION
HN Acquisition Corp. (the "Purchaser") is offering to purchase all of
the outstanding shares of common stock, par value $1.00 per share (the "Shares")
of Handy & Harman, a New York corporation (the "Company"), together with the
related Common Stock Purchase Rights (the "Rights") issued pursuant to the
Rights Agreement, dated as of January 26, 1989, as amended on April 25, 1996,
October 22, 1996 and March 1, 1998, between the Company and ChaseMellon
Shareholder Services LLC, as Rights Agent (the "Rights Agreement"), at a price
of $35.25 per Share, net to the seller in cash, without interest thereon, upon
the terms and subject to the conditions set forth in the Offer to Purchase dated
March 6, 1998 (the "Offer to Purchase") and in the related Letter of Transmittal
(which, as amended from time to time, together constitute the "Offer"). The
Purchaser is a New York corporation and a wholly owned subsidiary of WHX
Corporation, a Delaware corporation (the "Parent"). Unless the context requires
otherwise, all references to Shares herein include the associated Rights, and
all references to the Rights include all benefits that may inure to the holders
of the Rights pursuant to the Rights Agreement. Unless the Rights are redeemed
prior to the Expiration Date (as defined below), holders of Shares will be
required to tender one associated Right for each Share tendered in order to
effect a valid tender of such Share. Accordingly, shareholders who sell their
Rights separately from their Shares and do not otherwise acquire Rights may not
be able to satisfy the requirements of the Offer for the tender of Shares.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON THURSDAY, APRIL 2, 1998 (THE "EXPIRATION DATE"), UNLESS THE OFFER IS
EXTENDED.
<PAGE>
The Offer is conditioned upon, among other things, there being validly
tendered and not withdrawn prior to the expiration of the Offer that number of
Shares which, together with the Shares then owned by the Parent, the Purchaser
or other wholly owned subsidiaries of Parent, would represent at least a
majority of all outstanding Shares on a fully diluted basis on the date of
purchase.
The Offer is being made pursuant to an Agreement and Plan of Merger,
dated as of March 1, 1998 (the "Merger Agreement"), by and among the Company,
the Parent and the Purchaser. The Merger Agreement provides, among other things,
for the commencement of the Offer by the Purchaser and further provides that,
after the purchase of Shares pursuant to the Offer, subject to the satisfaction
or waiver of certain conditions, the Purchaser will be merged with and into the
Company (the "Merger"), with the Company surviving the Merger as a wholly owned
subsidiary of the Parent. Pursuant to the Merger, each outstanding Share (other
than Shares held by the Company as treasury stock, owned by the Parent, or any
subsidiary of the Parent (including the Purchaser) or held by shareholders
exercising appraisal rights under New York law) will be converted into a right
to receive $35.25 in cash, without interest.
THE BOARD OF DIRECTORS OF THE COMPANY HAS DETERMINED THAT THE OFFER AND
THE MERGER ARE FAIR TO AND IN THE BEST INTERESTS OF THE COMPANY AND ITS
SHAREHOLDERS AND RECOMMENDS THAT SHAREHOLDERS ACCEPT THE OFFER AND TENDER THEIR
SHARES IN THE OFFER.
The Purchaser expressly reserves the right, in its sole discretion and
subject to the terms of the Merger Agreement, at any time and from time to time,
to extend for any reason the period of time during which the Offer is open in
accordance with applicable regulations of the Securities and Exchange
Commission, including the occurrence of any of the events specified in Section
14 of the Offer to Purchase, by giving oral or written notice of such extension
to the Depositary (as defined in the Offer to Purchase) and by making a public
announcement thereof. During any such extension, all Shares previously tendered
and not properly withdrawn will remain subject to the Offer, subject to the
rights of a tendering shareholder to withdraw any tendered Shares.
For purposes of the Offer, the Purchaser will be deemed to have
accepted for payment, and thereby purchased, tendered Shares if, as and when the
Purchaser gives oral or written notice to the Depositary of the Purchaser's
acceptance of such Shares for payment. Payment for Shares accepted pursuant to
the Offer will be made by deposit of the aggregate purchase price therefor with
the Depositary, which will act as agent for tendering shareholders for the
purpose of receiving payment from the Purchaser and transmitting payment to such
tendering shareholders. Under no circumstances will interest be paid by the
Purchaser by reason of any delay in making such payment. Upon the deposit of
funds with the Depositary for the purpose of making payments to tendering
shareholders, the Purchaser's obligation to make such payment shall be satisfied
and tendering shareholders must thereafter look solely to the Depositary for
payment of amounts owed to them by reason of the acceptance for payment of
Shares pursuant to the Offer. In all cases, payment for Shares tendered and
accepted for payment pursuant to the Offer will be made only after timely
receipt by the Depositary of (a) certificates evidencing such Shares ("Share
Certificates"), or a timely confirmation of the book-entry transfer of such
Shares and, if applicable, Rights into the Depositary's account at a Book-Entry
Transfer Facility (as defined in the Offer to Purchase), pursuant to the
procedures set forth in Section 3 of the Offer to Purchase, (b) the Letter of
Transmittal (or a manually signed facsimile thereof), properly completed and
duly executed, with any required signature guarantees, or an Agent's Message (as
defined in the Offer to Purchase) in connection with a book-entry transfer, and
(c) any other documents required by the Letter of Transmittal.
If, for any reason whatsoever, acceptance for payment of or payment for
any Shares tendered pursuant to the Offer is delayed, or the Purchaser is unable
to accept for payment or pay for Shares tendered pursuant to the Offer, then,
without prejudice to the Purchaser's rights set forth herein, the Depositary
may, nevertheless, on behalf of the Purchaser and subject to Rule 14e-1(c) under
the Securities Exchange Act of 1934, as amended (the "Exchange
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<PAGE>
Act"), retain tendered Shares and such Shares may not be withdrawn except to the
extent that the tendering shareholder is entitled to and duly exercises
withdrawal rights as described in Section 4 of the Offer to Purchase.
The Purchaser will pay any stock transfer taxes incident to the
transfer to it of validly tendered Shares, except as otherwise provided in the
Letter of Transmittal, as well as any charges and expenses of the Depositary and
the Information Agent (as defined in the Offer to Purchase). If any tendering
Shares are not accepted for payment for any reason pursuant to the terms and
conditions of the Offer or if Share Certificates are submitted evidencing more
Shares than are tendered, Share Certificates evidencing unpurchased or
untendered Shares will be returned, without expense to the tendering shareholder
(or, in the case of Shares tendered by book-entry transfer into the Depositary's
account at a Book-Entry Transfer Facility pursuant to the procedure set forth in
Section 3 of the Offer to Purchase, such Shares will be credited to an account
maintained at such Book-Entry Transfer Facility), as promptly as practicable
following the expiration or termination of the Offer.
Except as otherwise provided in Section 4 of the Offer to Purchase,
tenders of Shares made pursuant to the Offer are irrevocable. Shares tendered
pursuant to the Offer may be withdrawn at any time prior to the Expiration Date
and, unless theretofore accepted for payment by the Purchaser pursuant to the
Offer, may also be withdrawn at any time after May 5, 1998 or at such later time
as may apply if the Offer is extended.
If the Purchaser extends the Offer, is delayed in its acceptance for
payment of Shares or is unable to accept Shares for payment pursuant to the
Offer for any reason, then, without prejudice to the Purchaser's rights under
the Offer, the Depositary may, nevertheless, on behalf of the Purchaser, retain
tendered Shares, and such Shares may not be withdrawn except to the extent that
tendering shareholders are entitled to withdrawal rights as described in Section
4 of the Offer to Purchase. Any such delay will be by an extension of the Offer
to the extent required by law.
For a withdrawal to be effective, a written or facsimile transmission
notice of withdrawal must be timely received by the Depositary at one of its
addresses set forth on the back cover of the Offer to Purchase. Any such notice
of withdrawal must specify the name of the person who tendered the Shares to be
withdrawn, the number of Shares to be withdrawn and, if Share Certificates have
been tendered, the name of the registered holder, if different from that of the
person who tendered such Shares. If Share Certificates to be withdrawn have been
delivered or otherwise identified to the Depositary, then prior to the release
of such Share Certificates, the serial numbers shown on the particular Share
Certificates to be withdrawn must be submitted to the Depositary, and the
signature(s) on the notice of withdrawal must be guaranteed by an Eligible
Institution (as defined in the Offer to Purchase), unless such Shares have been
tendered for the account of an Eligible Institution. If Shares have been
tendered pursuant to the procedure for book-entry transfer as set forth in
Section 3 of the Offer to Purchase, any notice of withdrawal must also specify
the name and number of the account at the Book-Entry Transfer Facility to be
credited with the withdrawn Shares, in which case a notice of withdrawal will be
effective if delivered to the Depositary by any method of delivery described in
the first sentence of this paragraph. Withdrawals of Shares may not be
rescinded, but the holder thereof may retender such Shares pursuant to the
procedures set forth in the Offer to Purchase.
The information required to be disclosed by Rule 14d-6(e)(1)(vii) of
the General Rules and Regulations under the Exchange Act is contained in the
Offer to Purchase and is incorporated herein by reference.
The Company has provided the Purchaser with the Company's shareholder
list and security position listings for the purpose of disseminating the Offer
to holders of Shares. The Offer to Purchase and the related Letter of
Transmittal and other relevant materials will be mailed to record holders of
Shares and will be furnished to brokers, dealers, commercial banks, trust
companies and similar persons whose names, or the names of whose nominees,
appear on the Company's shareholder list, or, if applicable, who are listed as
participants in a clearing agency's security position listing, for subsequent
transmittal to beneficial owners of Shares.
The Offer to Purchase and the Letter of Transmittal contain important
information which should be read carefully before any decision is made with
respect to the Offer.
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<PAGE>
Questions and requests for assistance and requests for copies of the
Offer to Purchase, the Letter of Transmittal and other tender offer materials,
may be directed to the Information Agent or the Dealer Manager at their
respective addresses and telephone numbers set forth below. Holders of Shares
may also contact brokers, dealers, commercial banks and trust companies for
additional copies of the Offer to Purchase, the Letter of Transmittal or other
tender offer materials.
The Information Agent for the Offer is:
[LOGO] INNISFREE M&A INCORPORATED
501 Madison Avenue, 20th Floor
New York, New York 10022
(212) 750-5833
or
CALL TOLL-FREE: (888) 750-5834
The Dealer Manager for the Offer is:
[LOGO] DONALDSON, LUFKIN & JENRETTE
2121 Avenue of the Stars, Suite 3000
Los Angeles, California 90067
Telephone: (310) 282-6161
CALL TOLL-FREE: (800) 237-5022, Ext. 5513
March 6, 1998
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