<PAGE>
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
<TABLE>
<S> <C>
Filed by the Registrant [ ]
Filed by a Party other than the Registrant [X]
Check the appropriate box:
[X] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission Only (as
permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
COMMUNICATION CABLE, INC.
(Name of Registrant as Specified in Its Charter)
KUHLMAN CORPORATION
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
PAYMENT OF FILING FEE (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is
calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
PRELIMINARY COPY
KUHLMAN CORPORATION
3 Skidaway Village Square
Savannah, Georgia 31411
PROXY STATEMENT
January , 1996
INTRODUCTION
The enclosed blue proxy card is delivered, and proxies are solicited, by
Kuhlman Corporation, a Delaware corporation ("Kuhlman"), for use at the Special
Meeting of Shareholders of Communication Cable, Inc., a North Carolina
corporation (the "Company"), to be held at the Company's headquarters located at
1378 Charleston Drive, Sanford, North Carolina 27330 at 10:00 a.m., Eastern
time, on Friday, February 16, 1996, and at any and all adjournments thereof (the
"Special Meeting"), for the purposes stated in the Notice of Special Meeting of
Shareholders and Proxy Statement of the Company, both dated January 17, 1996
(the "Company's Proxy Statement"). This Proxy Statement and the enclosed blue
proxy card are first being mailed to the Company's shareholders on or about the
date hereof.
KUHLMAN ACQUISITION CORP. IS NOT OBLIGATED TO CONSUMMATE THE TENDER OFFER
REFERRED TO HEREIN UNLESS AND UNTIL, AMONG OTHER THINGS, THE VOTING RIGHTS
CONDITION DESCRIBED HEREIN IS SATISFIED. KUHLMAN IS SOLICITING PROXIES TO VOTE
FOR THE VOTING RIGHTS PROPOSAL AND SATISFY THE VOTING RIGHTS CONDITION, THEREBY
POSITIONING KUHLMAN ACQUISITION CORP. TO CONSUMMATE THE TENDER OFFER.
PROXY SOLICITATION
The cost of solicitation of proxies will be borne by Kuhlman. Solicitation
of proxies will be made by mail, personally, or by telephone, facsimile
transmission or telegraph, by officers, directors and regular employees of
Kuhlman. Georgeson & Company Inc. ("Georgeson") has been engaged by Kuhlman to
assist in the solicitation of proxies from broker-dealers, banks and other
institutional holders at an approximate fee of $5,000 plus out-of-pocket
expenses. Georgeson may also be involved in the solicitation of proxies from
individual holders of record and non-objecting beneficial owners. Brokerage
houses and other custodians, nominees and fiduciaries will be reimbursed for
out-of-pocket expenses incurred in forwarding soliciting material to beneficial
owners.
VOTING PROCEDURE
According to the Company's Proxy Statement, the Board of Directors of the
Company has fixed the close of business on January 16, 1996 as the record date
for the determination of shareholders entitled to notice of and to vote at the
Special Meeting, and at the close of business on that day there were issued and
outstanding 2,641,033 shares of common stock, par value $1.00 per share, of the
Company. Shares constituting "interested shares" within the meaning of the North
Carolina Control Share Acquisition Act (the "Control Act") are not entitled to
vote at the Special Meeting. According to the Company's Proxy Statement, there
were 389,341 "interested shares" issued and outstanding at the close of business
on January 16, 1996. Only the remaining 2,251,692 shares are entitled to vote at
the Special Meeting, each of which is entitled to one vote. The approval of the
Voting Rights Proposal (as described below) requires the affirmative vote of the
holders of at least a majority of all the outstanding shares (not including
"interested shares").
Shares entitled to vote at the Special Meeting cannot be voted at the
Special Meeting unless the owner of record at the close of business on January
16, 1996 is present to vote in person or is represented by valid proxy.
Utilization of the enclosed proxy card is a means by which such a shareholder
may authorize the voting of his, her or its shares at the Special Meeting. All
shares entitled to vote that are represented by valid proxies received by
Georgeson, as tabulator of votes, prior to the time they are voted at the
Special Meeting will be voted as specified by the shareholder. If the
shareholder does not specify how his, her or its Shares are to be voted, then
such shares will be voted FOR the Voting Rights Proposal. A proxy may be revoked
by the shareholder at any time prior to the time it is voted upon delivery of
written notice to Georgeson or by attending the meeting and electing to vote in
person. If you have already completed, signed and delivered the Company's white
proxy card, then using the enclosed blue proxy card will revoke your prior
proxy.
<PAGE>
By signing and returning a proxy card, a shareholder also will be
authorizing the proxy holder to vote in his discretion regarding any procedural
motions which may come before the meeting.
VOTING RIGHTS PROPOSAL
THE OFFER
On November 29, 1995, Kuhlman Acquisition Corp. (the "Purchaser"), a North
Carolina corporation and a wholly-owned subsidiary of Kuhlman, commenced a
tender offer to purchase any and all outstanding shares (the "Shares") of the
Company's common stock, par value $1.00 per share (the "Common Stock"), for
$12.00 per Share, net to the seller in cash, upon the terms and subject to the
conditions set forth in an Offer to Purchase dated November 29, 1995 (the "Offer
to Purchase") and a related Letter of Transmittal (the "Letter of Transmittal").
On January 17, 1996, the Purchaser amended the Offer to Purchase with a
Supplement dated that date, which Supplement increased the price offered per
Share to $13 1/16, net. On January 23, 1996, the Purchaser again amended the
Offer to Purchase with a Supplement dated that date, which Supplement restated
the earlier Supplement and increased the price offered per Share to $14.00, net
(the "Offer Price"). The Offer to Purchase, the Supplement dated January 23,
1996 to the Offer to Purchase (the "Supplement") and the Letter of Transmittal
are attached hereto as Exhibits A, B and C, respectively, and collectively they
constitute the "Offer." For further information about the Purchaser and Kuhlman,
see Section 9 of the Offer to Purchase.
The purpose of the Offer is to enable the Purchaser to acquire control of
the Company. As soon as practicable following the purchase of Shares pursuant to
the Offer, the Purchaser intends to seek the maximum representation obtainable
on the Company's Board of Directors. Thereafter the Purchaser or the Company may
seek to purchase, as and in the manner permitted by law, Shares not purchased
pursuant to the Offer.
The Offer is conditioned upon, among other things, (1) there being validly
tendered and not withdrawn prior to the expiration of the Offer a number of
Shares that, excluding the Shares beneficially owned by the Purchaser,
constitutes at least a majority of the Common Stock outstanding on a fully
diluted basis (the "Minimum Tender Condition") and (2) the Purchaser being
satisfied, in its sole discretion, that the Control Act has been complied with
or is invalid or otherwise inapplicable to the Offer and that all Shares then
owned by the Purchaser have, and all Shares tendered for purchase pursuant to
the Offer will have, upon purchase by the Purchaser, the same voting rights as
all other Shares not constituting "interested shares" within the meaning of the
Control Act (the "Voting Rights Condition").
SHAREHOLDER APPROVAL OF THE VOTING RIGHTS PROPOSAL DESCRIBED BELOW WOULD
SATISFY THE VOTING RIGHTS CONDITION. KUHLMAN ACQUISITION CORP. IS NOT OBLIGATED
TO CONSUMMATE THE OFFER UNLESS AND UNTIL, AMONG OTHER THINGS, THE VOTING RIGHTS
CONDITION IS SATISFIED.
SUBSEQUENT DEVELOPMENTS
In its Schedule 14D-9 mailed to shareholders on or about December 13, 1995
(the "Schedule 14D-9"), the Company reported that on December 7, 1995 it
received an unsolicited indication of interest from another firm, subsequently
identified as Pentair, Inc. ("Pentair"), the tenor of which suggested that
Pentair might be willing to acquire the Company at a stated estimate of $12.25
to $13.00 per Share. According to the Schedule 14D-9, that indication of
interest was not binding and was subject to a number of conditions, including
due diligence. The Company provided information to Pentair subject to a
confidentiality agreement.
On January 15, 1996, the Company and Pentair entered into a letter of
intent providing for a merger of the Company into a Pentair subsidiary at a cash
price of $13.00 per Share. The Company thereupon amended its Schedule 14D-9 to
abandon its previously announced position of neutrality in favor of endorsing
the prospective Pentair merger over the Kuhlman tender offer.
On January 16, 1996, Kuhlman notified the Company that it would raise its
bid to $13 1/16 per Share and demanded that the Company complete, file and
disseminate the Company Proxy Statement and hold the Special Meeting as required
by the Control Act. In the Company Proxy Statement, mailed on or about January
17, 1996, the Special Committee recommended a vote against the Voting Rights
Proposal, explaining that it did not believe it to be in the best interests of
shareholders to grant voting rights to Kuhlman under circumstances where
rejection of Kuhlman's tender offer was recommended. The Special Committee also
stated, however, that it would reconsider its recommendation that shareholders
vote against the Voting Rights Proposal in the light of subsequent events.
2
<PAGE>
On January 22, 1996, the Company announced that it had signed an Agreement
and Plan of Merger with Pentair and a Pentair subsidiary (the "Merger
Agreement"), providing for a merger of the Company with such subsidiary at a
cash price of $13.50 per Share. The Company also announced that it had granted
to Pentair an option, exercisable until February 22, 1996, to purchase up to
300,000 shares of Common Stock at $13.50 per share. The Merger Agreement by its
terms requires the Company to pay Pentair a termination fee of $1,000,000, plus
expenses of up to $250,000, if the Company is acquired by another party and
under certain other circumstances. Consummation of the merger is subject to
approval by the Company's shareholders and certain other conditions. The Company
has agreed to call a meeting of its shareholders to be held during the week of
February 19, 1996 or as soon thereafter as may be mutually agreeable for the
purpose of voting on the Merger Agreement.
On January 23, 1996, Kuhlman amended its Offer to Purchase by increasing
the price offered per Share to $14.00, net to the seller in cash.
MARKET CHECKS
ON JANUARY 5, 1996, KUHLMAN ACQUISITION CORP. ACQUIRED 315,603 SHARES FROM
THE COMPANY'S PRESIDENT AND CHIEF EXECUTIVE OFFICER, JAMES R. FORE, BY
EXERCISING A CALL OPTION GRANTED TO KUHLMAN ACQUISITION CORP. PERSONALLY BY MR.
FORE AT AN EXERCISE PRICE OF $12.00 PER SHARE.
THE BOARD OF DIRECTORS OF THE COMPANY HAS OBTAINED A FAIRNESS OPINION FROM
INTERSTATE/JOHNSON LANE CORPORATION TO THE EFFECT THAT THE $12.00 PER SHARE
PRICE INITIALLY OFFERED BY KUHLMAN IS FAIR TO THE COMPANY'S SHAREHOLDERS FROM A
FINANCIAL POINT OF VIEW.
According to the Company's Proxy Statement, the Board believes that any
cash price above $12.00 per Share is fair to the Company's shareholders from a
financial point of view. The Offer Price bid by the Purchaser is $14.00 per
Share.
THE VOTING RIGHTS PROPOSAL
The Voting Rights Proposal is articulated in the Company's Proxy Statement
as follows: To grant voting rights to all of the Shares at any time acquired by
or for the Purchaser, directly or indirectly, in a "control share acquisition"
within the meaning of the Control Act, including any and all Shares that may be
acquired by the Purchaser pursuant to its offer to purchase any and all
outstanding Shares at $12.00 per Share, net to the seller in cash, on the terms
and subject to the conditions set forth in its Offer, as the same may be amended
or supplemented at any time prior to the conclusion of the Special Meeting.
The Control Act provides that an entity that acquires "control shares" of a
publicly held North Carolina corporation may not vote those shares unless a
majority of all the outstanding shares of the corporation (not including
"interested shares") entitled to vote for the election of directors adopts a
resolution to accord voting rights to the control shares. An entity acquires
control shares whenever it acquires shares that would bring its voting power in
the corporation to one of three thresholds: 20%, 33% or 50%. As used in the
Control Act, the term "interested shares" means shares of the corporation
beneficially owned by any person who has acquired or proposes to acquire control
shares in a control share acquisition, by any officer of the corporation or by
any employee of the corporation who is also a director of the corporation. The
disinterested shareholders decide whether to accord votes to such shares at the
corporation's next shareholders' meeting, unless the acquiror requests
management to hold a special meeting of shareholders for such purpose and files
a statement divulging certain information about itself and its intended plans.
If such a meeting is requested, it must be held within 50 days of such request.
On November 29, 1995, the Purchaser delivered an "acquiring person
statement" to the Company as required by the Control Act and requested that a
special meeting be called for the purpose of acting upon the Voting Rights
Proposal. The Company has called the Special Meeting in response to the
Purchaser's request and in compliance with the Control Act.
RECOMMENDATION OF KUHLMAN
Kuhlman recommends that shareholders vote FOR the Voting Rights Proposal as
the only means available to satisfy the Voting Rights Condition. Kuhlman
Acquisition Corp. need not consummate the Offer unless and until, among other
things, the Voting Rights Condition is satisfied. Therefore, shareholders should
vote FOR the Voting Rights Proposal if they want Kuhlman Acquisition Corp. to
consummate the Offer.
3
<PAGE>
OPTIONAL REDEMPTION
REDEMPTION RIGHTS
Section 55-9A-06 of the North Carolina Business Corporation Act (the
"NCBCA"), which is part of the Control Act, provides a right of redemption for
the shareholders of a "covered corporation" (such as the Company) following a
vote of the shareholders to accord voting rights to "control shares" acquired in
a control share acquisition. The Control Act by its terms would apply to a
non-exempt acquisition by the Purchaser of 20% or more of all outstanding Shares
in the present circumstances and would apply, therefore, to consummation of the
Offer upon satisfaction of the Minimum Tender Condition. According to the
Company's Proxy Statement, the Company intends to comply with the Control Act
and will therefore honor the redemption rights provided for by statute.
If the Voting Rights Proposal is approved at the Special Meeting and the
Purchaser obtains a majority of all voting power for the election of directors,
then all Company shareholders (other than the Purchaser) shall have the right,
as prescribed in Section 55-9A-06 of the NCBCA, to have their shares redeemed by
the Company at the "fair value" of those shares as of the day prior to the date
on which the Voting Rights Proposal was approved. The Control Act defines "fair
value" as a value, in the present context, that is not less than the highest
price paid per Share by the Purchaser pursuant to the Offer. The Offer Price is
$14.00 per Share. Accordingly, the redemption price under the Control Act will
be $14.00 per Share, subject to any increase in the Offer Price and assuming
compliance by the shareholder with the procedure stated below for redeeming the
holder's Shares.
PROCEDURE FOR REDEEMING SHARES
The right of redemption prescribed by the Control Act will be available
only to those shareholders who give the written notice required by Section
55-9A-06(b) of the NCBA, as described below.
In particular, a shareholder will have no right of redemption under the
Control Act unless the holder gives to the Company, prior to or at the Special
Meeting, written notice that, if the Voting Rights Proposal is approved, the
holder may ask for the redemption of the holder's Shares under the Control Act.
A shareholder need not vote against the Voting Rights Proposal in order to
exercise the redemption right prescribed by the Control Act.
If the Voting Rights Proposal is approved, and if the Purchaser (by means
of the Offer or otherwise) acquires control shares having a majority of all
voting power for the election of Company directors, then as soon as practicable
the Board of Directors of the Company shall cause a notice to be sent to all
shareholders of the Company advising them of such facts and reminding them that,
if they gave the written notice referred to above, they may have rights to have
their Shares redeemed at the fair value of such Shares pursuant to the Control
Act.
Within 30 days after the date on which a shareholder receives such notice,
the holder may make written demand on the Company for payment of the fair value
of the holder's Shares. After such demand, if the shareholder has complied with
the notice requirement referred to above, the Company shall redeem the holder's
Shares at their fair value within 30 days after the date on which the Company
received such holder's written demand for payment.
The Company's Proxy Statement states that the written notice and written
demand to be delivered by the shareholder, as explained above, may be delivered
to the Company at 1378 Charleston Drive, Sanford, North Carolina 27330,
Attention: Mr. William B. Cooper, Secretary-Treasurer.
The form and method of delivery of such written notice and written demand
is in each case at the option and risk of the shareholder. If notice or demand
is sent by mail, the use of registered mail with return receipt requested has
been recommended by the Company.
4
<PAGE>
SHARES OWNED BY CERTAIN SHAREHOLDERS, DIRECTORS AND OFFICERS
The table below shows, as of January 16, 1996, the beneficial ownership of
Shares by each shareholder known by the Purchaser and Kuhlman to own more than
5% of the outstanding Shares, by each director and named executive officer of
the Company and by all directors and executive officers of the Company, in each
case as disclosed in the Company's Proxy Statement. Except as otherwise noted,
the persons named in the table below are understood to have sole voting and
investment power with respect to all Shares shown as beneficially owned by them.
The address of each individual is given in the Company's Proxy Statement as c/o
Communication Cable, Inc., 1378 Charleston Drive, P. O. Box 1757, Sanford, NC
27330.
<TABLE>
<CAPTION>
NAME NUMBER OF SHARES (1) PERCENTAGE OF CLASS
<S> <C> <C>
Charles L. Wellard............................................. 315,971 11.8%
Kuhlman Acquisition Corp....................................... 315,703(2) 12.0%
3 Skidaway Village Square
Savannah, GA 31411
Dimensional Fund Advisors, Inc................................. 129,361 5.0%
1299 Ocean Avenue, 11th Floor
Santa Monica, CA 90401
John L. Bitter, Jr............................................. 29,880 *
George J. Falconero............................................ 22,878 *
Benjamin Greene................................................ 22,675 *
William B. Cooper.............................................. 24,061 *
William C. Cullen.............................................. 16,995 *
Steve B. Payne................................................. 24,809 *
Henry H. Lawton................................................ 7,773 *
James R. Fore.................................................. 0(2) 0
Directors and executive officers as a group (9 persons)........ 465,042 16.5%
</TABLE>
* Less than one percent.
(1) Includes certain Shares that certain persons have the right to acquire upon
the exercise of currently exercisable options: Charles L. Wellard, 47,475;
John L. Bitter, Jr., 18,042; George J. Falconero, 21,130; Benjamin Greene,
18,042; William B. Cooper, 24,061; William C. Cullen, 16,995; Steve B.
Payne, 24,809; and Henry H. Lawton, 7,773.
(2) In the first week of January 1996, Kuhlman Acquisition Corp. exercised its
option under its Stock Option Agreement with James R. Fore and thereby
acquired all 315,603 Shares theretofore owned by him. For additional
information about the Stock Option Agreement, see the introduction and
Section 11 of the Offer to Purchase attached hereto as Exhibit A.
ADDITIONAL INFORMATION
Each of the Company and Kuhlman is subject to the informational
requirements of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and in accordance therewith files periodic reports, proxy statements and
other documents and information with the SEC. Certain of the Company's periodic
reports and other documents have been incorporated by reference in, and are
included with, the Company's Proxy Statement. The Company's and Kuhlman's
officers, directors and principal shareholders are also presently subject to
filing requirements, as well as certain trading restrictions, imposed under the
Exchange Act. Such periodic reports, proxy statements and other documents and
information are available for inspection and copying at the reference facilities
maintained by the SEC at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549. Copies of such material may be obtained at prescribed
rates from the SEC Public Reference Section, 450 Fifth Street, N.W., Washington,
D.C. 20549.
IF YOU ARE ENTITLED TO VOTE, PLEASE SIGN AND DATE THE ENCLOSED BLUE PROXY
CARD AND MAIL IT PROMPTLY IN THE ACCOMPANYING ENVELOPE.
5
<PAGE>
<PAGE>
Exhibit A
OFFER TO PURCHASE FOR CASH
ANY AND ALL OUTSTANDING SHARES OF COMMON STOCK
OF
COMMUNICATION CABLE, INC.
AT
$12.00 NET PER SHARE
BY
KUHLMAN ACQUISITION CORP.
A WHOLLY-OWNED SUBSIDIARY OF
KUHLMAN CORPORATION
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON MONDAY, JANUARY 22, 1996, UNLESS EXTENDED.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER A NUMBER OF
SHARES THAT, WHEN ADDED TO THE SHARES BENEFICIALLY OWNED BY THE PURCHASER
(INCLUDING THE SHARES SUBJECT TO THE STOCK OPTION AGREEMENT REFERRED TO HEREIN),
CONSTITUTES AT LEAST 80% OF THE COMMON STOCK OUTSTANDING ON A FULLY DILUTED
BASIS (THE "MINIMUM TENDER CONDITION") AND (2) THE PURCHASER BEING SATISFIED, IN
ITS SOLE DISCRETION, THAT THE NORTH CAROLINA CONTROL SHARE ACQUISITION ACT HAS
BEEN COMPLIED WITH OR IS INVALID OR OTHERWISE INAPPLICABLE TO THE OFFER AND THAT
ALL SHARES THEN OWNED BY THE PURCHASER HAVE, AND ALL SHARES TENDERED FOR
PURCHASE PURSUANT TO THE OFFER WILL HAVE, UPON PURCHASE BY THE PURCHASER, THE
SAME VOTING RIGHTS AS ALL OTHER SHARES NOT CONSTITUTING "INTERESTED SHARES"
WITHIN THE MEANING OF SUCH ACT (THE "VOTING RIGHTS CONDITION").
IMPORTANT
Any holder of Shares desiring to tender all or any portion of such Shares
should either (1) complete and sign the enclosed Letter of Transmittal or a
facsimile copy thereof in accordance with the instructions in the Letter of
Transmittal and mail or deliver it with such holder's stock certificates, and
any other required documents to the Depositary (or tender such Shares pursuant
to the procedure for book-entry transfer set forth in Section 3, if such means
are available to such holder) or (2) request such holder's broker, dealer, bank
or other nominee to effect the transaction for such holder. A holder whose
Shares are registered in the name of a broker, dealer, bank or other nominee
must contact such broker, dealer, bank or other nominee to tender such Shares.
Any holder who desires to tender Shares and whose certificates for such
Shares are not immediately available, or who cannot comply in a timely manner
with the procedure for book-entry transfer of Shares, may tender such Shares by
following the procedure for guaranteed delivery set forth in Section 3.
Questions and requests for assistance or for additional copies of this
Offer to Purchase and the Letter of Transmittal may be directed to the
Information Agent.
The Information Agent for the Offer is:
GEORGESON
& COMPANY INC.
Wall Street Plaza
New York, New York 10005
(212) 440-9800 (Call Collect)
November 29, 1995
<PAGE>
TO THE SHAREHOLDERS OF
COMMUNICATION CABLE, INC.:
Kuhlman Acquisition Corp., a North Carolina corporation (the "Purchaser")
and a wholly-owned subsidiary of Kuhlman Corporation, a Delaware corporation
("Kuhlman"), hereby offers to purchase any and all outstanding shares (the
"Shares") of common stock, par value $1.00 per share (the "Common Stock"), of
Communication Cable, Inc., a North Carolina corporation (the "Company"), at
$12.00 per Share, net to the seller in cash, upon the terms and subject to the
conditions set forth in this Offer to Purchase and in the related Letter of
Transmittal (which together constitute the "Offer"). The holders of Shares are
referred to herein as "Shareholders" or "holders." Tendering Shareholders will
not be obligated to pay brokerage commissions, fees or, except as otherwise
provided in the Letter of Transmittal, transfer taxes with respect to the
purchase of Shares by the Purchaser pursuant to the Offer. The Purchaser will
pay all charges and expenses of Harris Trust Company of New York, as Depositary,
and of Georgeson & Company Inc., as Information Agent, in connection with the
Offer.
The purpose of the Offer is to enable the Purchaser to acquire control of
the Company. As soon as practicable following the purchase of Shares pursuant to
the Offer, the Purchaser intends to seek the maximum representation obtainable
on the Company's Board of Directors. Thereafter the Purchaser or the Company may
seek to purchase, as and in the manner permitted by law, Shares not purchased
pursuant to the Offer. It is possible that the Purchaser ultimately will acquire
the entire equity interest in the Company, although the Purchaser has not yet
determined whether or how to pursue that end other than by offering to purchase
any and all Shares in the Offer. For a discussion of different scenarios in
which the Company might become a party to a merger, see Section 12 of this Offer
to Purchase.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER A NUMBER OF
SHARES THAT, WHEN ADDED TO THE SHARES BENEFICIALLY OWNED BY THE PURCHASER
(INCLUDING THE SHARES SUBJECT TO THE STOCK OPTION AGREEMENT REFERRED TO HEREIN),
CONSTITUTES AT LEAST 80% OF THE COMMON STOCK OUTSTANDING ON A FULLY DILUTED
BASIS (THE MINIMUM TENDER CONDITION) AND (2) THE PURCHASER BEING SATISFIED, IN
ITS SOLE DISCRETION, THAT THE NORTH CAROLINA CONTROL SHARE ACQUISITION ACT HAS
BEEN COMPLIED WITH OR IS INVALID OR OTHERWISE INAPPLICABLE TO THE OFFER AND THAT
ALL SHARES THEN OWNED BY THE PURCHASER HAVE, AND ALL SHARES TENDERED FOR
PURCHASE PURSUANT TO THE OFFER WILL HAVE, UPON PURCHASE BY THE PURCHASER, THE
SAME VOTING RIGHTS AS ALL OTHER SHARES NOT CONSTITUTING "INTERESTED SHARES"
WITHIN THE MEANING OF SUCH ACT (THE VOTING RIGHTS CONDITION). SEE SECTION 15.
THE OFFER DOES NOT CONSTITUTE A SOLICITATION OF PROXIES FOR ANY MEETING OF
THE COMPANY'S SHAREHOLDERS. ANY SUCH SOLICITATION BY KUHLMAN OR THE PURCHASER
WILL BE MADE ONLY PURSUANT TO SEPARATE PROXY MATERIALS COMPLYING WITH THE
REQUIREMENTS OF SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED
(THE "EXCHANGE ACT").
The Offer will expire at 12:00 midnight, New York City time, on Monday,
January 22, 1996, unless extended.
On November 20, 1995, the Purchaser and Kuhlman entered into a Stock Option
Agreement (the "Stock Option Agreement") with James R. Fore, the Company's
President and Chief Executive Officer, who is referred to herein as the "Selling
Stockholder." The Stock Option Agreement covers all Shares owned by the Selling
Stockholder at any time until January 15, 1996, subject to extension in certain
circumstances (the "Selling Stockholder's Shares"). At the date of the Stock
Option Agreement, the Selling Stockholder represented and warranted to the
Purchaser that he owned 268,128 Shares, as well as presently exercisable options
to purchase an additional 47,475 Shares. The Selling Stockholder is obligated to
exercise "in-the-money" options, subject to extension in certain circumstances,
upon the written request of the Purchaser following an exercise of either of the
Put Option or the Call Option referred to below. On the assumption that all of
the Selling Stockholder's options are in-the-money, at the date of the Stock
Option Agreement the Selling Stockholder's Shares consisted of 315,603 Shares.
Pursuant to the Stock Option Agreement: (1) the Selling Stockholder has an
option (the "Put Option") to sell all of the Selling Stockholder's Shares to the
Purchaser at any time and from time to time until the close of business on
January 15, 1996, subject to extension in certain circumstances, at a purchase
price of $12.00 per share (the "Exercise Price"); and (2) the Purchaser has an
option (the "Call Option") to purchase all of the Selling Stockholder's Shares
from the Selling Stockholder at any time and from time to time after December
31, 1995 until the close of business on January 15, 1996, subject to extension
in certain circumstances, at the Exercise Price. See Section 11 for further
information relating to the Stock Option Agreement, including the circumstances
under which the terms of the Put Option and Call Option may be extended.
According to the Company's Quarterly Report on Form 10-Q for its quarterly
period ended July 31, 1995 (the "Company's 10-Q"), on July 31, 1995 there were
issued and outstanding 2,574,005 Shares. According to the Company's Annual
Report on Form 10-K for its fiscal year ended October 31, 1994 (the "Company's
1994 10-K"), on October 31, 1994 there were issued and outstanding options to
purchase 240,567 Shares, all of which were then exercisable. Consequently, if
the
2
<PAGE>
Purchaser acquires 315,603 Shares pursuant to the Stock Option Agreement, then,
including 100 Shares purchased by the Purchaser in the open market on November
27, 1995, the Purchaser will own approximately 12.0% of the 2,621,480 Shares
assumed to be outstanding (without giving effect to the exercise of any of the
options to purchase 193,092 other Shares assumed to be outstanding and
exercisable) and 11.2% of the 2,814,572 Shares assumed to be outstanding (giving
effect to the exercise of the options to purchase all 193,092 other Shares
assumed to be outstanding and exercisable). Assuming that no Shares were issued
after July 31, 1995 and that no options were granted or became exercisable after
October 31, 1994, the Minimum Tender Condition would be satisfied if an
aggregate of 1,935,955 Shares (other than the Shares subject to the Stock Option
Agreement and the 100 Shares purchased by the Purchaser on November 27, 1995)
were validly tendered by the Expiration Date and not withdrawn. The actual
number of Shares that constitutes the Minimum Tender Condition will depend on
the Company's capital accounts as they exist when the Offer is consummated.
THIS OFFER TO PURCHASE AND THE LETTER OF TRANSMITTAL CONTAIN IMPORTANT
INFORMATION WHICH SHOULD BE READ CAREFULLY BEFORE ANY DECISION IS MADE WITH
RESPECT TO THE OFFER.
1. TERMS OF THE OFFER; NUMBER OF SHARES. Upon the terms and subject to the
conditions of the Offer, the Purchaser will accept for payment and purchase any
and all Shares that are validly tendered and not properly withdrawn on or prior
to the Expiration Date (as hereinafter defined). The term "Expiration Date"
shall mean 12:00 Midnight, New York City time, on Monday, January 22, 1996,
unless the Purchaser, in its sole discretion, shall have extended the period of
time for which the Offer is open, in which event the term "Expiration Date"
shall mean the latest time and date on which the Offer, as so extended by the
Purchaser, shall expire.
The Purchaser expressly reserves the right, at any time or from time to
time, to extend the period of time during which the Offer is open by giving oral
or written notice of such extension to the Depositary. During any such
extension, all Shares previously tendered and not accepted for payment or
withdrawn will remain subject to the Offer and may be accepted for payment by
the Purchaser.
If the Purchaser decreases the percentage of Shares being sought or
increases or decreases the consideration to be paid for Shares pursuant to the
Offer, and if the Offer is scheduled to expire at any time before the expiration
of a period of 10 business days from and including the date that notice of such
increase or decrease is first published, sent or given in the manner specified
below, then the Offer will be extended until the expiration of such period of 10
business days. If the Purchaser makes a material change in the terms of the
Offer (other than a change in price or percentage of Shares sought) or in the
information concerning the Offer, or waives a material condition of the Offer,
then the Purchaser will extend the Offer, if required by applicable law, for a
period sufficient to allow Shareholders to consider the amended terms of the
Offer. For purposes of the Offer, a "business day" means any day other than a
Saturday, Sunday or federal holiday and consists of the time period from 12:01
A.M. through 12:00 Midnight, New York City time.
The Purchaser also reserves the right (i) upon the occurrence of any of the
conditions specified in Section 15 (including, without limitation, the Minimum
Tender Condition), to delay (except as otherwise required by applicable law)
acceptance for payment of or payment for Shares, or to terminate the Offer and
not accept for payment or pay for Shares, or (ii) at any time or from time to
time to amend the Offer in any respect or to waive or modify the Minimum Tender
Condition or any other condition of the Offer (subject, in any case, to any
applicable requirement that the Offer be extended for a period sufficient to
allow Shareholders to consider such amendment, waiver or modification). The
reservation by the Purchaser of the right to delay acceptance for payment of or
payment for Shares is subject to the provisions of applicable law which require
that the Purchaser pay the consideration offered or return the Shares deposited
as promptly as practicable after termination or withdrawal of the Offer.
Any such extension, delay, termination or amendment will be followed as
promptly as practicable by a public announcement thereof, 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. Without
limiting the manner in which the Purchaser may choose to make any such public
announcement, the Purchaser shall have no obligation (except as otherwise
required by applicable law) to publish, advertise or otherwise communicate any
such public announcement other than by making a release to the Dow Jones News
Service.
A request is being made to the Company for the use of its stockholder lists
and security position listings for the purpose of disseminating the Offer to
Shareholders. This Offer to Purchase and the related Letter of Transmittal will
be mailed by the Purchaser to record holders of Shares on the date hereof and
will be furnished to brokers, dealers, banks, trust companies and similar
persons whose names, or the names of whose nominees, appear on the stockholder
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.
3
<PAGE>
2. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES. Upon the terms and
subject to the conditions of the Offer, the Purchaser will accept for payment,
and will pay for Shares validly tendered and not properly withdrawn (including
during any extension of the Offer, if the Offer is extended, subject to the
terms of such extension), as soon as practicable after the later of (i) the
Expiration Date and (ii) the satisfaction or waiver of the conditions set forth
in Section 15.
For purposes of the Offer, the Purchaser shall 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, as agent for tendering
Shareholders, of its acceptance for payment of such Shares pursuant to the
Offer. Payment for Shares purchased pursuant to the Offer will be made by
deposit of the purchase price with the Depositary, which will then transmit
payments to tendering Shareholders. Under no circumstances will interest on the
purchase price for Shares be paid by the Purchaser, regardless of any delay in
transmitting such payments. If the Purchaser increases the consideration to be
paid for Shares pursuant to the Offer, then the Purchaser will pay such
increased consideration for all Shares purchased pursuant to the Offer. If any
tendered Shares are not purchased pursuant to the Offer for any reason, or if
certificates are submitted for more Shares than are tendered, then certificates
for such unpurchased Shares will be returned, without expense to the tendering
Shareholder (or, in the case of Shares delivered by book-entry transfer within a
Book-Entry Transfer Facility as described in Section 3 below, such Shares will
be credited to an account maintained within such Book-Entry Transfer Facility),
without expense to the tendering Shareholder, as promptly as practicable
following the expiration or termination of the Offer. Delivery of documents to a
Book-Entry Transfer Facility in accordance with Book-Entry Transfer Facility
procedures does not constitute delivery to the Depositary.
If the Purchaser extends the Offer, is delayed in its acceptance for
payment of, or payment for, Shares or is unable to accept for payment or pay for
Shares pursuant to the Offer for any reason, then, without prejudice to the
Purchaser's rights under this Offer to Purchase, the Depositary may,
nevertheless, on behalf of the Purchaser and subject to Rule 14e-1 under the
Exchange Act, retain tendered Shares, and such Shares may not be withdrawn,
except to the extent tendering holders are entitled to, and duly exercise,
withdrawal rights as described in Section 4.
The Purchaser reserves the right to transfer or assign to one or more of
its affiliates or direct or indirect subsidiaries the right to purchase Shares
tendered pursuant to the Offer, but any such transfer or assignment by the
Purchaser will not relieve it of its obligations under the Offer and will not
prejudice the rights of tendering Shareholders to receive payment for Shares
properly tendered and accepted for payment pursuant to the Offer.
3. PROCEDURE FOR ACCEPTING THE OFFER AND TENDERING SHARES. For a
Shareholder validly to tender Shares pursuant to the Offer, a properly completed
and duly executed Letter of Transmittal (or facsimile thereof) with any required
signature guarantees and any other required documents must be received by the
Depositary at one of its addresses set forth on the back cover page of this
Offer to Purchase, and either the certificates for such Shares must be delivered
to the Depositary or pursuant to the procedure for book-entry transfer set forth
below (and a confirmation of receipt of such tendered Shares received by the
Depositary), in each case prior to the Expiration Date, or else the Shareholder
must comply with the guaranteed delivery procedure set forth below.
Within two business days after the date of this Offer to Purchase, the
Depositary will establish an account with respect to the Shares at The
Depository Trust Company, the Midwest Securities Trust Company and the
Philadelphia Depository Trust Company (individually, a "Book-Entry Transfer
Facility," and, collectively, the "Book-Entry Transfer Facilities"). Any
financial institution that is a participant in a Book-Entry Transfer Facility
system may make book-entry delivery of Shares by causing a Book-Entry Transfer
Facility to transfer such Shares into the Depositary's account in accordance
with such Book-Entry Transfer Facility procedure for such transfer. Although
delivery of Shares may be effected through book entry at such Book-Entry
Transfer Facility, the Letter of Transmittal (or facsimile thereof) with any
required signature guarantees and any other required documents must, in any
case, be received by the Depositary at one of its addresses set forth on the
back cover page of this Offer to Purchase by the Expiration Date, or else the
Shareholder must comply with the guaranteed delivery procedure set forth below.
Except as otherwise provided below, all signatures on a Letter of
Transmittal must be guaranteed by an eligible institution in a recognized
Medallion Guarantee Program (an "Eligible Institution"). An Eligible Institution
means a firm or any other entity identified in Rule 17Ad-15 under the Exchange
Act, including (as such terms are defined therein): (i) a bank; (ii) a broker,
dealer, municipal securities dealer, municipal securities broker, government
securities dealer or government securities broker; (iii) a credit union; (iv) a
national securities exchange, registered securities association or clearing
agency; or (v) a savings association. A verification by a notary public is not
acceptable. Signatures on a Letter of Transmittal need not be guaranteed if the
Letter of Transmittal is signed by the registered holder(s) of the Share
certificates submitted therewith and such holder(s) have not completed either
the box entitled "Special Payment Instructions" or the box entitled "Special
4
<PAGE>
Delivery Instructions" on the Letter of Transmittal. See Instruction 1 of the
Letter of Transmittal. If the certificate(s) are registered in the name of a
person other than the signer of the Letter of Transmittal, or if payment is to
be made or unpurchased Shares are to be issued to a person other than the
registered owner, then the certificate(s) must be endorsed or accompanied by
appropriate powers of attorney, in either case signed exactly as the name(s) of
the registered owner(s) appear(s) on the certificate(s), with the signature(s)
on the certificate(s) or power(s) of attorney guaranteed as aforesaid. See
Instruction 5 of the Letter of Transmittal.
THE METHOD OF DELIVERY OF SHARES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE
OPTION AND RISK OF THE TENDERING SHAREHOLDER. IF SENT BY MAIL, THE USE OF
REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED.
IN ORDER TO PREVENT BACKUP FEDERAL INCOME TAX WITHHOLDING AT A 31% RATE ON
PAYMENTS MADE TO CERTAIN SHAREHOLDERS WITH RESPECT TO THE PURCHASE PRICE OF
SHARES PURCHASED PURSUANT TO THE OFFER, EACH SUCH SHAREHOLDER MUST, UNLESS AN
EXEMPTION APPLIES, PROVIDE THE DEPOSITARY WITH SUCH HOLDER'S CORRECT TAXPAYER
IDENTIFICATION NUMBER AND CERTIFY THAT SUCH HOLDER IS NOT SUBJECT TO BACKUP
FEDERAL INCOME TAX WITHHOLDING BY COMPLETING THE SUBSTITUTE FORM W-9 INCLUDED
WITH THE LETTER OF TRANSMITTAL.
If a Shareholder desires to tender Shares pursuant to the Offer and such
Shareholder's certificates for Shares are not immediately available or time will
not permit such Shareholder to deliver such certificates and any other required
documents to the Depositary prior to the Expiration Date, then such Shares may
nevertheless be tendered provided that all of the following conditions are
satisfied:
(a) such tender is made by or through an Eligible Institution;
(b) a properly completed and duly executed Notice of Guaranteed Delivery,
substantially in the form made available by the Purchaser, is received by the
Depositary (as provided below) by the Expiration Date; and
(c) the certificates for such Shares in proper form for transfer (or
confirmation of book-entry transfer of Shares into the Depositary's account at a
Book-Entry Transfer Facility as described above), together with a properly
completed and duly executed Letter of Transmittal (or facsimile thereof) and any
other documents required by the Letter of Transmittal, are received by the
Depositary within three National Association of Securities Dealers, Inc.
("NASD") Automated Quotation ("NASDAQ") National Market System trading days
after the date of execution of such Notice of Guaranteed Delivery.
The Notice of Guaranteed Delivery may be delivered by hand, or may be
transmitted by telegram, telex, facsimile transmission or mail, to the
Depositary and must include a guarantee by an Eligible Institution in the form
set forth in such Notice.
Payment for Shares purchased pursuant to the Offer will in all cases be
made only after timely receipt by the Depositary of certificates therefor (or
timely confirmation of a book-entry transfer of Shares into the Depositary's
account at a Book-Entry Transfer Facility as described above), a properly
completed and duly executed Letter of Transmittal (or facsimile thereof) and any
other required documents.
By executing a Letter of Transmittal as set forth above, a tendering
Shareholder irrevocably appoints designees of the Purchaser as such
Shareholder's proxies, in the manner set forth in the Letter of Transmittal,
each with full power of substitution, to the full extent of such Shareholder's
rights with respect to the Shares tendered by such Shareholder and accepted for
payment by the Purchaser (and any and all other Shares and other securities
issued or issuable in respect of such Shares on or after November 29, 1995 (the
"Offer Commencement Date")), effective when the Purchaser accepts such Shares
for payment. All such proxies shall be considered coupled with an interest in
the tendered Shares. Such appointment is effective only upon the acceptance for
payment of such Shares by the Purchaser. Accordingly, a tendering Shareholder
will retain the voting rights (and other rights) associated with such holder's
Shares upon tendering such Shares in response to this Offer and at all times
thereafter unless and until such Shares are accepted for payment. Upon
acceptance for payment, all prior proxies given by such Shareholder with respect
to such purchased Shares and other securities will be, without further action,
revoked, and no subsequent proxies may be given. Such designees will, with
respect to such Shares or other securities, be empowered to exercise all voting
and other rights of such Shareholder as they in their discretion may deem proper
in respect of any annual, special or adjourned meeting of the Company's
stockholders, or otherwise.
All questions as to the form of documents and the validity, eligibility
(including time of receipt) and acceptance for payment of any tender of Shares
will be determined by the Purchaser, whose determination shall be final and
binding. The Purchaser reserves the absolute right to reject any or all tenders
of Shares determined by it not to be in proper form or the acceptance for
payment of or payment for which may, in the opinion of the Purchaser's counsel,
be unlawful. The Purchaser
5
<PAGE>
also reserves the absolute right to waive the Minimum Tender Condition or any
other condition of the Offer or any defect or irregularity in any tender of
Shares.
The Purchaser, the Depositary and the Information Agent shall be under no
duty to give notification of any defects or irregularities in tenders and shall
incur no liability for failure to give any such notification. The Purchaser's
acceptance for payment of Shares tendered pursuant to any one of the procedures
set forth above 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 may be
withdrawn at any time prior to the Expiration Date. Thereafter, such tenders are
irrevocable, except that Shares may be withdrawn after January 27, 1996 unless
theretofore accepted for payment as provided in this Offer to Purchase. If the
Purchaser extends the period of time during which the Offer is open, is delayed
in accepting for payment or paying for Shares, or is unable to accept for
payment or pay for Shares pursuant to the Offer for any reason, then, without
prejudice to the Purchaser's rights under the Offer, the Depositary may, on
behalf of the Purchaser, retain all Shares tendered, and such Shares may not be
withdrawn except as otherwise provided in this Section 4.
For a withdrawal to be effective, a written, telegraphic, telex or
facsimile transmission notice of withdrawal must be timely received by the
Depositary at one of its addresses set forth on the back cover page 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(s) of the certificates
evidencing such Shares if different from that of the person tendering such
Shares. If certificates for Shares to be withdrawn have been delivered to the
Depositary, then, prior to the release of such certificates, the tendering
Shareholder must also submit the serial numbers shown on the particular
certificates evidencing such Shares and the signature on such holder's notice of
withdrawal must be guaranteed by an Eligible Institution, unless the Shares to
be withdrawn were tendered for the account of an Eligible Institution. If Shares
have been delivered pursuant to the procedure for book-entry transfer as set
forth in Section 3, then the notice of withdrawal must specify the name and
number of the account at the applicable 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 sole discretion, whose determination shall be final and
binding. Withdrawals may not be revoked, and any Shares properly withdrawn will
be deemed not validly tendered for purposes of the Offer. Properly withdrawn
Shares may be retendered, however, by following any of the procedures described
in Section 3 at any subsequent time prior to the Expiration Date.
5. CERTAIN TAX CONSEQUENCES. The receipt by non-dissenting Shareholders of
cash in exchange for Shares pursuant to the Offer will be treated as a taxable
sale for federal income tax purposes and also may be a taxable transaction under
applicable state, local, foreign and other tax laws.
In general, for federal income tax purposes, such a holder will recognize
gain or loss upon such sale equal to the difference between such holder's
adjusted tax basis in the Shares sold in the Offer and the amount of cash to be
received in exchange therefor. Gain or loss will be calculated separately for
each block of Shares tendered and accepted for payment pursuant to the Offer.
Such gain or loss generally will be capital gain or loss for federal income tax
purposes if the Shares were capital assets in the hands of the Shareholder. Such
capital gain or loss will be long-term capital gain or loss with respect to
Shares held more than 12 months.
The foregoing discussion may not apply to Shareholders who acquired their
Shares pursuant to compensation arrangements with the Company or who are not
citizens or residents of the United States or who are otherwise subject to
special tax treatment under the Internal Revenue Code of 1986, as amended.
In order to avoid backup withholding of federal income tax on the cash
received upon the surrender of Shares pursuant to the Offer, a Shareholder must,
unless an exemption applies, provide the Depositary with such holder's correct
taxpayer identification number ("TIN") on Substitute Form W-9 included in the
Letter of Transmittal and certify, under penalties of perjury, that such number
is correct. If the correct TIN is not provided, then a $50 penalty may be
imposed by the Internal Revenue Service and payments made in exchange for the
surrendered Shares may be subject to backup withholding of 31%. Backup
withholding is not an additional federal income tax. Rather, the federal income
tax liability of persons subject to backup withholding will be reduced by the
amount of such tax withheld. If backup withholding results in an overpayment of
taxes, then a refund may be obtained from the Internal Revenue Service.
THE FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL
INFORMATION ONLY. DUE TO THE INDIVIDUAL NATURE OF TAX CONSEQUENCES, EACH
SHAREHOLDER IS URGED TO CONSULT SUCH HOLDER'S OWN TAX ADVISOR AS TO THE SPECIFIC
TAX
6
<PAGE>
CONSEQUENCES TO SUCH HOLDER OF THE OFFER, INCLUDING THE EFFECTS OF APPLICABLE
FEDERAL, STATE, LOCAL, FOREIGN AND OTHER TAX LAWS AND OF CHANGES IN THE TAX
LAWS.
6. MARKET FOR COMMON STOCK; DIVIDENDS. The Common Stock is traded on the
NASDAQ National Market System under the symbol "CABL." The following table sets
forth, for the periods indicated, the high and low closing sale prices per share
of Common Stock, as reported by NASDAQ, according to the Company's Annual
Reports on Form 10-K for the fiscal year ended October 31, 1994 (the "Company's
1994 10-K") and published financial sources.
<TABLE>
<CAPTION>
HIGH LOW
<S> <C> <C>
Fiscal Year Ended October 31, 1993:
First Quarter...................................................................... $ 13 1/4 $ 7
Second Quarter..................................................................... 13 11
Third Quarter...................................................................... 17 1/2 10
Fourth Quarter..................................................................... 15 1/4 11 1/4
Fiscal Year Ended October 31, 1994:
First Quarter...................................................................... $ 13 1/4 $ 10 1/4
Second Quarter..................................................................... 13 10 1/4
Third Quarter...................................................................... 14 1/4 8
Fourth Quarter..................................................................... 15 13
Fiscal Year Ended October 31, 1995:
First Quarter...................................................................... $ 14 $ 7 1/2
Second Quarter..................................................................... 8 7 1/2
Third Quarter...................................................................... 11 7
Fourth Quarter..................................................................... 10 1/2 9
Fiscal Year Ended October 31, 1996:
First Quarter (through November 28, 1995).......................................... $ 9 1/2 $ 8 1/2
</TABLE>
On November 28, 1995, the last full day of trading prior to the Offer
Commencement Date, the last sale price for the Common Stock, as reported by
NASDAQ, was $9.00 per Share. SHAREHOLDERS ARE URGED TO OBTAIN CURRENT MARKET
QUOTATIONS FOR THE COMMON STOCK.
According to the Company's 1994 10-K and published financial sources, the
Company has paid no cash dividends on its Common Stock.
According to the Company, its outstanding options to purchase Shares were
issued pursuant to an Incentive Stock Option Plan, a Directors Stock Option Plan
and a 1995 Outside Directors Stock Option Plan (collectively, the "Option
Plans"). The Option Plans impose severe restraints on the transferability of
options outstanding under the Option Plans (the "Outstanding Options"). There is
no trading market for the Outstanding Options.
7. EFFECT OF THE OFFER ON MARKET FOR THE SHARES; EXCHANGE ACT REGISTRATION.
The purchase of Shares pursuant to the Offer will reduce the number of Shares
that might otherwise trade publicly and may reduce the number of holders of
Shares, which could adversely affect the liquidity and market value of the
remaining Shares held by the public. According to the Company's 1994 10-K, on
October 31, 1994 there were 2,494,839 Shares outstanding and approximately 1,300
record holders of Shares. Depending upon the number of Shares purchased pursuant
to the Offer, the Common Stock may no longer meet the standards for continued
inclusion in the NASDAQ National Market System. If trading volume were lower
than such standards, then quotations might continue to be published in the
"additional list" or in one of the "local lists," or such quotations might not
be published at all. If the number of Shareholders fell below 300, then NASDAQ
might cease to provide quotations, but quotations might still be available from
other sources. The Purchaser cannot predict the extent of the public market for
the Shares or the availability of quotations after the Offer, which will depend
upon the number of holders of the Shares remaining at such time, the interest in
maintaining any market in the Shares on the part of securities firms, whether or
not the Shares are "margin securities"' for purposes of the margin regulations
of the Board of Governors of the Federal Reserve System (the "Federal Reserve
Board"), possible termination of registration of the Common Stock under the
Exchange Act, as described below, and other factors.
The Shares are currently "margin securities" under the regulations of the
Federal Reserve Board, which has the effect, among other things, of allowing
brokers to extend credit on such Shares as collateral. Depending on factors
similar to those described above, following the Offer the Shares might no longer
constitute "margin securities" for the purposes of the Federal Reserve Board's
margin regulations, in which case they could no longer be used as collateral for
loans made by brokers.
7
<PAGE>
The Common Stock is currently registered under the Exchange Act. Such
registration may be terminated upon application of the Company to the Securities
and Exchange Commission (the "Commission") if the outstanding Shares are neither
listed on a national securities exchange nor held by 300 or more holders of
record. The Purchaser and Kuhlman intend to seek to cause the Company to apply
for termination of Exchange Act registration of the Common Stock as soon after
consummation of the Offer as the requirements for termination are met and to
take all permitted actions to make the Company eligible for such termination.
Immediately upon the filing of an application to terminate registration of the
Common Stock, the Company's obligations to file periodic reports with the
Commission would be suspended. If registration of the Common Stock were
terminated, then the Company no longer would be required to file such reports,
and 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 or information statement pursuant to Sections 14(a) and 14(c) in
connection with shareholders' meetings or written consents and the related
requirement of furnishing an annual report to shareholders, and the requirements
of Rule 13e-3 under the Exchange Act with respect to "going private"
transactions, no longer would apply to the Company. Furthermore, "affiliates" of
the Company and persons holding "restricted securities" of the Company might be
deprived of the ability to dispose of such securities pursuant to Rule 144 under
the Securities Act of 1933, as amended. If registration of the Shares under the
Exchange Act were terminated, then the Shares no longer would be "margin
securities" or be eligible for NASDAQ reporting.
8. CERTAIN INFORMATION CONCERNING THE COMPANY. The Company is a North
Carolina corporation with its principal executive offices located at 1378
Charleston Drive, Sanford, North Carolina 27331. Its telephone number at that
address is (919) 775-7775.
This paragraph contains certain information about the Company's business as
derived from the Company's 1994 10-K. The Company engineers, designs and
manufactures electronic wire and cable which are marketed to original equipment
manufacturers and, through local distributors, to a variety of end users. The
Company manufactures coaxial, multi-conductor and ribbon cable which are used
for data, voice and video communications by the computer and data processing
industries, the medical and industrial electronics industries, the U.S.
Government and U.S. Government agencies and for satellite and other
telecommunications applications. The Company is an approved cable source to a
number of leading industrial companies which have performed extensive tests and
procedures in evaluating the Company's products to qualify them for purchase.
While most of the Company's product line conforms to standard specifications,
the Company also emphasizes the production of re-engineered and modified
standard cable and custom cable. The Company began significant production in
1986 and currently operates plants in Siler City, Hayesville and Sanford, North
Carolina, and in Texarkana, Arkansas.
Set forth below is certain selected financial information for the Company
for the fiscal years ended October 31, 1992, 1993 and 1994 and the nine months
ended July 31, 1994 and 1995, as derived from the Company's 1994 10-K and the
Company's 10-Q. More comprehensive financial information is included in such
reports and in the other documents filed by the Company with the Commission. The
following summary is qualified in its entirety by reference to such reports and
other documents and all of the financial information and related notes contained
therein. Such reports and other documents may be examined and copies may be
obtained from the offices of the Commission in the manner set forth below.
8
<PAGE>
COMMUNICATION CABLE INC.
SELECTED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER-SHARE DATA)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEAR ENDED OCTOBER 31, JULY 31,
1992 1993 1994 1994 1995
<S> <C> <C> <C> <C> <C>
(UNAUDITED)
Income Statement Information:
Net Sales............................................................ $40,559 $47,662 $52,376 $37,819 $41,459
Net Income........................................................... 1,033 1,737 1,521 1,411 1,120
Net Income Per Share................................................. .41 .68 .59 .53 .43
</TABLE>
<TABLE>
<CAPTION>
AT OCTOBER 31, AT JULY 31,
1992 1993 1994 1995
<S> <C> <C> <C> <C>
(UNAUDITED)
Balance Sheet Information:
Working Capital...................................................... $12,098 $13,362 $14,301 $15,811
Total Assets......................................................... 24,950 26,234 27,899 28,654
Long-Term Debt....................................................... 5,340 4,987 4,592 4,287
Stockholders' Equity................................................. 14,612 16,384 18,017 19,173
</TABLE>
The Company is subject to the disclosure requirements of the Exchange Act
and in accordance therewith files periodic reports, proxy statements and other
information with the Commission relating to its business, financial condition
and other matters. Such reports, proxy statements and other information may be
inspected at the public reference facilities maintained by the Commission at
Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549 and should also be
available for inspection and copying at the regional offices of the Commission
in Chicago (Citicorp Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661) and New York (Seven World Trade Center, 13th Floor, New York,
New York 10048). Copies of such material can also be obtained from the Public
Reference Section of the Commission in Washington, D.C. (450 Fifth Street, N.W.,
Washington, D.C. 20549), at prescribed rates.
Except as otherwise set forth herein, the information concerning the
Company contained in this Offer to Purchase has been taken from or is based upon
reports and other documents on file with the Commission or otherwise publicly
available. Although the Purchaser has no knowledge that would indicate that any
statements contained herein based on such documents and records are untrue, it
cannot take responsibility for the accuracy or completeness of the information
contained in such reports and other documents or for any failure by the Company
to disclose events that may have occurred or may affect the significance or
accuracy of any such information but are unknown to the Purchaser.
9. CERTAIN INFORMATION CONCERNING THE PURCHASER AND KUHLMAN. The Purchaser
was incorporated in North Carolina on July 27, 1994 for the purpose of acquiring
the Company and has not conducted any other business to date.
All of the outstanding capital stock of the Purchaser is owned by Kuhlman,
a Delaware corporation whose predecessor was founded in 1894. Kuhlman is a
holding company with two core business segments, "Electrical Products" and
"Industrial Products." In its Electrical Products segment it manufactures and
markets products such as electrical and electronic wire and cable products, as
well as distribution, power and instrument transformers. In its Industrial
Products segment it manufactures and markets products such as turbochargers,
engine cooling fans, fan drives and crankshaft vibration dampers used in
enhancing the efficiency of diesel and gasoline engines, as well as spring
products and metal stampings for automotive and non-automotive applications.
The principal offices of the Purchaser and of Kuhlman are located at 3
Skidaway Village Square, Savannah, Georgia 31411. The telephone number for each
of them at that address is (912) 598-7809.
The name, citizenship, business address, present principal occupation or
employment and five-year employment history of each executive officer and
director of the Purchaser and Kuhlman are set forth in Annexes A and B hereto,
respectively.
Kuhlman is subject to the disclosure requirements of the Exchange Act and
in accordance therewith files periodic reports, proxy statements and other
information with the Commission relating to its business, financial condition
and other
9
<PAGE>
matters. Such reports, proxy statements and other information are available for
inspection and copying at prescribed rates at the offices of the Commission as
set forth in Section 8.
Set forth below is certain selected consolidated financial information for
Kuhlman excerpted or derived from its Current Report on Form 8-K dated July 21,
1995 (the "Kuhlman 8-K") and its Quarterly Report on Form 10-Q for its quarterly
period ended September 30, 1995 (the "Kuhlman 10-Q"). More comprehensive
financial information is included in the Kuhlman 8-K and the Kuhlman 10-Q and in
other documents filed with the Commission, and the following data is qualified
in its entirety by reference to such reports and other documents and to all of
the financial information and related notes contained therein or incorporated
therein by reference.
KUHLMAN CORPORATION
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER-SHARE DATA)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEAR ENDED DECEMBER 31, SEPTEMBER 30,
1992 1993 1994 1994 1995
<S> <C> <C> <C> <C> <C>
(UNAUDITED)
Income Statement Information:
Net Sales...................................................... $231,426 $242,221 $396,117 $297,033 $318,301
Net Income (Loss).............................................. (5,247) 310 9,970 8,966 4,355
Net Income (Loss) per share.................................... (0.42) 0.02 0.73 0.66 0.33
Balance Sheet Information:
(at end of period)
Working Capital................................................ $ 54,845 $ 63,397 $ 49,501 $ 49,501 $ 48,736
Total Assets................................................... 155,530 242,921 229,185 229,185 237,001
Long-Term Debt................................................. 38,469 97,824 76,895 76,895 76,336
Stockholders' Equity........................................... 64,842 64,187 73,216 73,216 74,012
</TABLE>
Except for 100 Shares purchased by the Purchaser in the open market on
November 27, 1995 at a price of $9.00 per Share, and except as described in
Section 11, neither the Purchaser nor Kuhlman nor, to the best knowledge of the
Purchaser, any of the persons listed on Annexes A and B hereto, beneficially
owns or has a right to acquire any of the Shares; with the same exceptions,
neither the Purchaser nor Kuhlman nor, to the best knowledge of the Purchaser,
any of the persons listed on Annexes A and B hereto, has effected any
transaction in the Shares during the past 60 days. Except as set forth in
Section 11, neither the Purchaser or Kuhlman nor, to the best knowledge of the
Purchaser, any of the persons listed on Annexes A and B hereto, has any
contract, arrangement, understanding or relationship with any other person with
respect to any securities of the Company, including, but not limited to, the
transfer or voting thereof, joint ventures, loan or option arrangements, puts or
calls, guaranties of loans, guaranties against loss or the giving or withholding
of proxies. Except as described in Section 11 and except for purchases of wire
and cable by a Kuhlman subsidiary from the Company aggregating approximately
$1,426,084, $2,542,581 and $2,029,624 in the Company's fiscal years ended
October 31, 1993, 1994 and 1995, respectively, and approximately $30,583 in its
current fiscal year to date, neither the Purchaser nor Kuhlman nor, to the best
knowledge of the Purchaser, any of the persons listed on Annexes A and B hereto,
has since November 1, 1992 had any business relationship or transaction with the
Company or any of its executive officers, directors or affiliates such as would
require reporting under the rules of the Commission. Except as described in
Sections 10, 11 and 12, since November 1, 1992 there have been no contacts,
negotiations or transactions between, on the one hand, the Purchaser or Kuhlman
or any of the persons listed in Annexes A and B hereto, and, on the other hand,
the Company or any of its affiliates, in any such case concerning: a merger,
consolidation or acquisition; a tender offer or other acquisition of securities;
an election of directors; or a sale or other transfer of a material amount of
assets.
10. BACKGROUND OF THE OFFER; CONTACTS WITH THE COMPANY. In February 1994,
as part of its strategy to search for acquisitions that could further strengthen
and diversify Kuhlman, Kuhlman identified the Company as an opportunity for a
business combination that would allow Kuhlman to expand and enhance its presence
in the wire and cable industry.
In March 1994, the Company was asked whether it would be interested in
expanding its relationship with Kuhlman. The Company had been a supplier of
certain wire and cable products to one of Kuhlman's indirect subsidiaries
(Coleman Cable
10
<PAGE>
Systems, Inc.) for several years. The Company's Chief Executive Officer advised
that the Company would consider a business combination. In April 1994, there
were separate discussions with a director and with the Chief Executive Officer
of the Company regarding a possible combination of the Company with Kuhlman.
At the regularly scheduled annual meeting of the Kuhlman Board of Directors
in April 1994, the possible combination of the Company and Kuhlman was discussed
and favorably received. Following this meeting, the Chief Executive Officer of
Kuhlman contacted the Chief Executive Officer of the Company to further discuss
a possible combination and to arrange for a meeting. In May 1994, senior
executives of Kuhlman met with senior officers of the Company at one of the
Company's plants. Following that plant visit, the Chief Executive Officers of
both Kuhlman and the Company had further discussions regarding the possible form
of a business combination of Kuhlman and the Company. The Chief Executive
Officer of the Company requested, and later received, in the beginning of June
1994, information on Kuhlman and a possible combination, which he distributed to
members of the Company's Board of Directors.
Later in June 1994, the Chief Executive Officers of Kuhlman and the Company
decided that a presentation by Kuhlman's Chief Executive Officer to the Company
Board of Directors would be appropriate, and such a presentation was scheduled
for later in June 1994. Prior to this proposed presentation, the Chief Executive
Officer of Kuhlman communicated with the members of the Kuhlman Board of
Directors regarding details of a possible combination of Kuhlman and the Company
and, with the support of the Kuhlman Board of Directors, proceeded with further
discussions with the Company. On June 24, 1994, the Chief Executive Officer of
Kuhlman, accompanied by senior executives of Kuhlman, made a presentation to the
Company Board of Directors and provided a draft of a letter of intent with
respect to a possible combination.
Following the meeting on June 24, 1994, further discussions occurred
between Kuhlman and Company senior executives, as well as between Kuhlman's
senior executives and representatives of the Company's financial advisor,
regarding additional information requested by the Company to evaluate a possible
combination. Both parties conducted due diligence on each other, directly and
through their agents, attorneys and accountants.
On July 7, 1994, the Company's Chief Executive Officer advised Kuhlman's
Chief Executive Officer that the Company Board of Directors had reviewed the
possibility of a combination with Kuhlman and was generally positive about such
a possible combination as well as about discussing, negotiating and executing a
letter of intent as soon as it could obtain additional information regarding
Kuhlman. The Chief Executive Officer of Kuhlman communicated the status of the
possible transaction to the Kuhlman Board of Directors. On July 14, 1994, a
meeting was held between Kuhlman's senior executives and the Company's senior
executives, as well as representatives of the Company's financial advisor, at
which time additional information concerning the two companies was exchanged
between Kuhlman and the Company.
Having previously considered the various corporate materials and financial
information concerning Kuhlman, the Company Board of Directors, on July 17,
1994, appointed a Special Committee of the Company Board of Directors (the
"Company Special Committee") to consider the proposed letter of intent with
Kuhlman.
On July 18, 1994, the Company Board of Directors and the Company Special
Committee met by telephone with their financial and legal advisors to consider
the proposed letter of intent with Kuhlman. The Company Board of Directors
approved the letter of intent on July 18, 1994, and on that same day Kuhlman and
the Company executed the letter of intent. The signing of the letter of intent
was announced publicly and mutual due diligence reviews continued in greater
detail.
On July 29, 1994, a regularly scheduled meeting of the Kuhlman Board of
Directors was held at which the proposed merger with the Company was discussed.
At that meeting, the Kuhlman Board of Directors authorized continued
negotiations with the Company and the preparation and execution of a definitive
written agreement providing for the merger of a wholly-owned subsidiary of
Kuhlman with and into the Company on the terms set forth in the letter of intent
and discussed at the meeting.
On September 9, 1994, the Company Special Committee met at the Company's
offices in connection with the regularly scheduled meeting of the Company Board
of Directors. The purpose of the meeting was for the Company Special Committee
to receive reports regarding information it had requested from management,
financial and legal advisors, accountants and environmental consultants. In
addition to considering the proposed merger with Kuhlman, the Company Special
Committee considered whether it would be in the best interest of the Company's
shareholders to solicit indications of interest from third parties. The Company
Special Committee decided that it was not in the best interest of the Company
and its shareholders to solicit indications of interest from third parties, but
that the Company Special Committee would continue to respond in a diligent
manner to any indications of interest to acquire the Company. The Company
Special Committee also gave non-binding preliminary approval of the proposed
merger with Kuhlman, subject to completion of the Company Special Committee's
evaluation of the proposed transaction.
11
<PAGE>
The parties continued to negotiate the terms of the merger agreement.
On September 20, 1994, the Company Special Committee held another meeting
at the Company's offices. The purpose of the meeting was to receive updated
reports from management, consultants and advisors in connection with the
proposed merger. The Company Special Committee also reviewed the form of merger
agreement proposed by Kuhlman for approval. The Company Special Committee
unanimously determined that it was in the best interest of the Company and its
shareholders to proceed with the proposed merger with Kuhlman, and the Company
Special Committee recommended the proposed merger agreement to the Company Board
of Directors for approval.
Following the meeting of the Company Special Committee on September 20,
1994, the Company Board of Directors met. The Company Board of Directors
received the report and recommendations of the Special Committee. After due
discussion and deliberation, the Company Board of Directors unanimously approved
and adopted all of the recommendations of the Company Special Committee.
On September 21, 1994, the Company and Kuhlman executed a definitive merger
agreement. Thereafter, both the Company and Kuhlman directed their efforts
towards finalizing the preparation and filing of a registration statement with
the Commission. A registration statement was filed on October 6, 1994. Following
the receipt of comments from the Commission, both the Company and Kuhlman
directed their efforts to both preparing an amendment to the registration
statement and continued mutual due diligence. For a number of reasons, including
the long lapse of time from the parties' original discussions and changing
market and operating conditions at both companies, the Company and Kuhlman
terminated their merger agreement on January 10, 1995.
In June 1995, senior executives of the Company and Kuhlman again entered
into discussions about a possible business combination. In early July, Kuhlman
proposed to the Company's Chief Executive Officer and to Charles L. Wellard (a
Company director and holder of approximately 12.0% of the Common Stock) an
agreement by the terms of which the two Shareholders would grant to George J.
Falconero (a third Company director) an irrevocable proxy to vote certain of
their Shares in circumstances looking towards a business combination of Kuhlman
and the Company. An agreement was never executed by all the parties and never
became effective.
In late July, a draft of a letter of intent covering a proposed merger
between Kuhlman and the Company was prepared and circulated among the companies
and their legal counsel. In early August, Kuhlman delivered drafts of a stock
purchase agreement covering Shares owned by the Company's Chief Executive
Officer and a stock option agreement covering certain Shares owned by Mr.
Wellard. None of these documents was ever executed or became effective.
On August 9, 1995, Kuhlman's Chief Executive Officer advised Mr. Falconero
that Kuhlman had decided to terminate its efforts to attempt to structure a
business combination with the Company.
In November 1995, Kuhlman's Chief Executive Officer contacted the Company's
Chief Executive Officer relative to acquiring his Shares. On November 16, 1995,
legal counsel for Kuhlman delivered to legal counsel for the Company's Chief
Executive Officer a summary of terms of a stock option agreement covering his
Shares. Negotiations occurred that day and the next day.
On November 16, 1995, senior executives of Kuhlman briefed Kuhlman's
directors on the negotiations pending with the Company's Chief Executive Officer
and on preparations for the Offer. Discussions with and among the Kuhlman Board
of Directors and Kuhlman senior executives were held that afternoon and evening.
On November 17, 1995, the Kuhlman Board of Directors approved the execution
of a stock option agreement and an employment agreement with the Company's Chief
Executive Officer and the making of the Offer.
On November 18, 1995, legal counsel for Kuhlman delivered to legal counsel
for the Company's Chief Executive Officer drafts of a stock option agreement
covering his Shares and an employment agreement. Negotiations continued through
the next day. The definitive versions of these agreements were signed on
November 20, 1995.
On November 28, 1995, senior executives of Kuhlman and Kuhlman's
acquisition counsel attended a special meeting of the Company Board of Directors
at the request of Kuhlman's Chief Executive Officer. At that meeting they
advised the Company's directors of the Purchaser's intention to make the Offer,
and they solicited the cooperation and support of the Company Board of
Directors.
11. THE STOCK OPTION AGREEMENT; THE EMPLOYMENT AGREEMENT. On November 20,
1995, the Purchaser and Kuhlman entered into the Stock Option Agreement with the
Selling Stockholder. The Stock Option Agreement covers all Shares owned by the
Selling Stockholder at any time until January 15, 1995, subject to extension in
certain circumstances. At the
12
<PAGE>
date of the Stock Option Agreement, the Selling Stockholder represented and
warranted to the Purchaser that he owned 268,128 Shares, as well as presently
exercisable options to purchase an additional 47,475 Shares. The Selling
Stockholder is obligated to exercise "in-the-money" options, subject to
extension in certain circumstances, upon the written request of the Purchaser
following an exercise of either of the Put Option or the Call Option referred to
below. On the assumption that all of the Selling Stockholder's options are
in-the-money, at the date of the Stock Option Agreement the Selling
Stockholder's Shares consisted of 315,603 Shares. The Stock Option Agreement
evidences both a Put Option and a Call Option: (1) the Selling Stockholder has
an option to sell all of the Selling Stockholder Shares to the Purchaser at any
time and from time to time until the close of business on January 15, 1996,
subject to extension (as explained below in this Section 11), at an Exercise
Price of $12.00 per Share; and (2) the Purchaser has an option to purchase all
of the Selling Stockholder's Shares from the Selling Stockholder at any time and
from time to time after December 31, 1995 until the close of business on January
15, 1996, subject to extension (as explained below in this Section 11), at the
same Exercise Price.
The Stock Option Agreement states that the Selling Stockholder may exercise
a Put Option by sending written notice to the Purchaser specifying a date (not
earlier than the third business day nor later than the fifth business day
following the date such notice is given) for the closing of such sale and the
number of Selling Stockholder's Shares to be sold on that date. The Purchaser
may exercise a Call Option by sending written notice to the Selling Stockholder
specifying a date (not earlier than the third business day nor later than the
fifth business day following the date such notice is given) for the closing of
such purchase and the number of Selling Stockholder Shares to be purchased on
that date. On the closing date of a purchase and sale pursuant to an exercise of
the Put Option or Call Option, the Selling Stockholder shall deliver to the
Purchaser a certificate or certificates, duly endorsed (or accompanied by duly
executed stock powers), representing the Selling Stockholder's Shares subject to
the applicable put exercise notice or call exercise notice, including the Shares
acquired by the Selling Stockholder upon exercise of all Company options, free
and clear of all liens.
In the Stock Option Agreement, the Selling Stockholder has covenanted and
agreed during the Relevant Term (as defined below) not (i) to sell, transfer,
pledge, assign, hypothecate or otherwise dispose of, or enter into any contract
with respect to the sale, transfer, pledge, assignment, hypothecation or other
disposition of, any Selling Stockholder's Shares or Company options otherwise
than pursuant to the Stock Option Agreement, (ii) to grant any proxy with
respect to any Selling Stockholder's Shares or Company options, deposit any
Selling Stockholder's Shares or Company options into a voting trust or enter
into a voting agreement with respect to any Selling Stockholder's Shares or
Company options otherwise than pursuant to the Stock Option Agreement or (iii)
to take any action that would make any representation or warranty of the Selling
Stockholder therein untrue or incorrect. The Selling Stockholder has further
covenanted and agreed during the Relevant Term: (iv) upon the receipt or
exercise of any Company option, to notify the Purchaser immediately of such
event; (v) upon the written request of the Purchaser, to grant the Purchaser or
its designee(s) an irrevocable proxy to vote or otherwise exercise all
shareholder rights pertaining to all Selling Stockholder's Shares as directed by
the Purchaser or such designee(s); and (vi) upon the reasonable written or oral
request of the Purchaser, to assist the Purchaser and Kuhlman in furtherance of
the Acquisition (as defined below) in the manner and to the extent not
inconsistent with the Selling Stockholder's duties to the Company and its other
shareholders and in the manner and to the extent he may lawfully do so in his
personal capacity as a shareholder of the Company.
In the Stock Option Agreement, "Relevant Term" is defined as the period
from November 20, 1995 until the earliest to occur of (i) the acquisition by the
Purchaser of all of the Selling Stockholder's Shares pursuant to exercise of the
Put Option or the Call Option, (ii) any other acquisition by the Purchaser,
Kuhlman or a Kuhlman affiliate of all of the Selling Stockholder's Shares, (iii)
the time at which the Put Option and the Call Option may no longer be exercised
(taking into account any extension) and the closings pursuant to all due and
timely exercises of the Put Option and the Call Option have been consummated as
required (including pursuant to any extension anticipated by the Stock Option
Agreement) or (iv) the close of business on April 20, 1996. The term
"Acquisition" means the first to occur of (i) the purchase by Kuhlman, the
Purchaser or a Kuhlman affiliate of no less than that number of shares of
capital stock of the Company as would then have voting power sufficient to elect
a majority of the directors of the Company, (ii) the purchase by Kuhlman, the
Purchaser or a Kuhlman affiliate of all or substantially all of the assets of
the Company or (iii) a merger of the Company with or into Kuhlman, the Purchaser
or a Kuhlman affiliate.
In the event that, on January 15, 1996, neither the Put Option nor the Call
Option has been exercised in full, and on such date the Put Option or the Call
Option or both (as the case may be) may not be exercised by reason of any
judicial or regulatory judgment, decree or order preventing or restraining such
exercise (an "Exercise Prohibition"), then the time within which the Put Option
or the Call Option or both (as the case may be) may be exercised under the Stock
Option Agreement will be extended until the earlier of (i) the first date
thereafter on which an Exercise Prohibition does not exist and has not existed
for at least the three preceding consecutive business days or (ii) the close of
business on April 15, 1996. In the event
13
<PAGE>
that, on the date specified in a put exercise notice or call exercise notice for
the closing of the purchase and sale of Selling Stockholder's Shares thereunder,
such closing may not be consummated by reason of any judicial or regulatory
judgment, decree or order preventing or restraining such closing (a "Closing
Prohibition"), then the time for such closing shall be extended until the
earlier of (i) the first date thereafter on which a Closing Prohibition does not
exist and has not existed for at least the three preceding consecutive business
days or (ii) the close of business on April 20, 1996. The parties to the Stock
Option Agreement have agreed to use their reasonable best efforts (subject, in
the case of the Selling Stockholder, to his duties to the Company and its other
shareholders) to remove as soon as practicable any Exercise Prohibition or
Closing Prohibition that arises during the Relevant Term.
Also on November 20, 1995, the Selling Stockholder signed an Employment
Agreement with the Purchaser. The Employment Agreement recites that the Selling
Stockholder continues to be employed by the Company as its President and Chief
Executive Officer, and continues to be a director of the Company, and that
nothing in the Employment Agreement is intended to interfere with the due and
proper performance of his duties to the Company or to create any employment
relationship with him prior to the Commencement Date referred to below.
According to the parties, the purpose of the Employment Agreement is to set
forth the terms of the Selling Stockholder's employment with the Purchaser in
the event that Kuhlman should consummate an acquisition of the Company through
the Purchaser.
The Employment Agreement shall become effective upon the first to occur of
(i) the purchase by Kuhlman, the Purchaser or a Kuhlman affiliate of no less
than that number of shares of the Company as would then have voting power
sufficient to elect a majority of the directors of the Company, (ii) the
purchase by Kuhlman, the Purchaser or a Kuhlman affiliate of all or
substantially all of the assets of the Company or (iii) a merger of the Company
with or into Kuhlman, the Purchaser or a Kuhlman affiliate (the date of the
first to occur of such events being the "Commencement Date"). The term of the
Selling Stockholder's employment by the Purchaser shall be the three years
immediately following the Commencement Date, unless terminated earlier. During
his employment with the Purchaser, the Selling Stockholder has promised to
devote his full business time, skill, energies, judgment, knowledge and efforts
to advancement of the best interests of the Purchaser and its subsidiaries and
the performance of such executive duties on behalf of the Purchaser and its
subsidiaries as the Board of Directors of the Purchaser may assign to him from
time to time.
As compensation for the services to be rendered by the Selling Stockholder
during the term of the Employment Agreement, the Purchaser has agreed to pay him
the following salary and bonus: in and for the first year following the
Commencement Date, $300,000; in and for the second year following the
Commencement Date, $330,000; and in and for the third year following the
Commencement Date, $363,000. The Selling Stockholder and his spouse also will
receive medical and health insurance benefits consistent with the insurance
benefits that they are currently entitled to receive from the Company. At any
time after the six-month period commencing with the Commencement Date, the
Employee may by notice terminate his employment effective as of a date not less
than 30 days after the date such notice is given. Notwithstanding the occurrence
of any such termination, the compensation and benefits payable to him shall
continue to be paid for the remainder of the three-year term. The Purchaser also
has agreed to pay such compensation and benefits following the death or
disability of the Selling Stockholder during and for the three-year term or upon
his early termination by the Purchaser with or without cause.
As a party to the Employment Agreement, Kuhlman has guaranteed to the
Selling Stockholder the faithful and timely performance of the obligations of
the Purchaser stated in the Employment Agreement. The Purchaser and Kuhlman,
jointly and severally, will indemnify the Selling Stockholder and hold him
harmless from and against certain losses, liabilities, costs or expenses
resulting from the execution, delivery or performance of the Employment
Agreement. The Selling Stockholder has agreed to keep confidential all
information and documents furnished to him by or on behalf of the Purchaser and
not to use the same to his advantage, except to the extent such information or
documents become lawfully obtainable from other sources or are in the public
domain through no violation of the Employment Agreement on his part or as
consented to in writing.
The foregoing is a summary of certain provisions of the Stock Option
Agreement and the Employment Agreement, the full texts of which have been filed
as exhibits to the Schedule 14D-1 filed with the Commission by the Purchaser in
connection with the Offer. Such summary is qualified in its entirety by
reference to such exhibits, which are available for inspection (and copies of
which may be obtained) at the same places and in the same manner as set forth
with respect to the information concerning the Company in Section 8 of this
Offer to Purchase (except that they will not be available at the regional
offices of the Commission).
12. PURPOSE OF THE OFFER. The purpose of the Offer is to enable the
Purchaser to acquire control of the Company. As soon as practicable following
the purchase of Shares pursuant to the Offer, the Purchaser intends to seek the
maximum
14
<PAGE>
representation obtainable on the Company Board of Directors. Thereafter the
Purchaser or the Company may seek to purchase, as and in the manner permitted by
law, Shares not purchased pursuant to the Offer. Such purchases may be effected
in privately negotiated transactions, in one or more tender or exchange offers,
in open market purchases or otherwise. It is possible that the Purchaser
ultimately will acquire the entire equity interest in the Company. Whether or
not the Offer is consummated, the Purchaser expressly reserves the right,
subject to applicable law, to sell or otherwise dispose of any or all Shares
acquired pursuant to the Offer or otherwise. Such transactions may be effected
on terms and at prices as it shall determine, which may be more or less than the
price to be paid pursuant to the Offer and could be for cash or other
consideration.
On the assumption that the Offer is consummated, it may be necessary,
nevertheless, for the Purchaser to await the next annual meeting of the
Company's shareholders, or to call a special meeting of the Company's
shareholders, to cause the election of persons constituting a majority of the
Company Board of Directors. The Company's Bylaws provide that its Board of
Directors shall be not less than three nor more than ten, as may be fixed by
resolution duly adopted by the shareholders or by the Board of Directors prior
to the annual meeting at which such directors are to be elected. The Company
Board of Directors currently consists of six members whose terms expire at the
next annual meeting of the Shareholders. The Company's Bylaws provide that any
director may be removed at any time with or without cause by a vote of the
shareholders holding a majority of the outstanding shares entitled to vote at an
election of directors. The Company's Proxy Statement dated January 27, 1995
states that the Shareholders do not have cumulative voting rights.
There are several scenarios in which the Purchaser might effect a merger
with the Company, depending upon the percentage of the Common Stock that may be
acquired by the Purchaser, among other factors. The following discussion assumes
the satisfaction of the Minimum Tender Condition and the Voting Rights
Condition, the consummation of the Offer by the Purchaser and approval by the
Company Board of Directors of the actions and transactions described.
Section 55-11-04 of the North Carolina Business Corporation Act, as amended
(the "NCBCA"), provides that a parent corporation owning at least 90% of the
outstanding shares of each class of a subsidiary corporation may merge the
subsidiary into itself without approval of the shareholders of the parent or
subsidiary. Under this "short form" merger statute, if the Purchaser were to own
at least 90% of the Shares upon consummation of the Offer (or at any time
thereafter), then -- but for the fact that the Common Stock is registered under
Section 12 of the Exchange Act -- the Purchaser could effect a merger with the
Company without approval of the shareholders of either company. In this
connection, The North Carolina Shareholder Protection Act (the "Protection
Act") -- which applies by its terms to a North Carolina corporation (such as the
Company) that has a class of shares registered under Section 12 of the Exchange
Act -- purports to require the affirmative vote of the holders of 95% of the
voting shares of the corporation, considered as one class, for the adoption or
authorization of a merger with any other entity (such as the Purchaser) if the
other entity beneficially owns, directly or indirectly, more than 20% of the
voting shares of the corporation, considered as one class. Exempted from the
Protection Act are certain transactions in which minimum pricing and stock
values are involved and certain other "fairness" requirements are met.
In particular, the "fairness" provisions of the Protection Act state that
the 95% vote requirement of the Protection Act shall not apply to a business
combination in which each of the following conditions is met:
(1) the cash, or fair market value of other consideration, to be received
per share by the holders of the corporation's common stock in such
business combination bears the same or a greater percentage
relationship to the market price of the corporation's common stock
immediately prior to the announcement of such business combination by
the corporation as the highest per share price (including brokerage
commissions and/or soliciting dealers' fees) which such other entity
has theretofore paid for any of the shares of the corporation's common
stock already owned by it bears to the market price of the
corporation's common stock immediately prior to the commencement of
acquisition of the corporation's common stock by such other entity,
directly or indirectly;
(2) the cash, or fair market value of other consideration, to be received
per share by holders of the corporation's common stock in such business
combination (i) is not less than the highest per share price (including
brokerage commissions and/or soliciting dealers' fees) paid by such
other entity in acquiring any of its holdings of the shares of the
corporation's common stock and (ii) is not less than the earnings per
share of the corporation's common stock for the four full consecutive
fiscal quarters immediately preceding the record date for the
solicitation of votes on such business combination, multiplied by the
then price/earnings multiple, if any, of such other entity as
customarily computed and reported in the financial community;
(3) after the other entity has acquired a 20% interest and prior to the
consummation of such business combination: (i) the other entity shall
have taken steps to ensure that the corporation's board of directors
included at all times
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representation by continuing directors proportionate to the outstanding
shares of the corporation's common stock held by persons not affiliated
with the other entity (with a continuing director to occupy any
resulting fractional board position); (ii) there shall have been no
reduction in the rate of dividends payable on the corporation's common
stock, except as may have been approved by a unanimous vote of its
directors; (iii) the other entity shall have not acquired any newly
issued shares of the corporation's capital stock, directly or
indirectly, from the corporation, except upon conversion of any
convertible securities acquired by the other entity prior to obtaining
a 20% interest or as a result of a pro rata stock dividend or stock
split; and (iv) the other entity shall not have acquired any additional
shares of the corporation's outstanding common stock, or securities
convertible into common stock, except as part of the transaction which
resulted in the other entity acquiring its 20% interest;
(4) the other entity shall not have (i) received the benefit, directly or
indirectly, except proportionately with other shareholders, of any
loans, advances, guarantees, pledges, or other financial assistance or
tax credits provided by the corporation or (ii) made any major change
in the corporation's business or equity capital structure unless by a
unanimous vote of the directors, in either case prior to the
consummation of the business combination; and
(5) a proxy statement responsive to the requirements of the Exchange Act
shall be mailed to the public shareholders of the corporation for the
purpose of soliciting shareholder approval of the business combination
and shall contain prominently in the forepart thereof any
recommendations as to the advisability or inadvisability of the
business combination which the continuing directors, or any of them,
may choose to state and, if deemed advisable by a majority of the
continuing directors, an opinion of a reputable investment banking firm
as to the fairness (or not) of the terms of the business combination to
the remaining public shareholders of the corporation, which investment
banking firm shall be selected by a majority of the continuing
directors and shall be paid by the corporation a reasonable fee for its
services upon receipt of such opinion.
In view of the effect of the Protection Act on use of the short form merger
statute, the Purchaser would prefer to pursue a merger with the Company upon
acquiring 95% or more of the Common Stock (there being no other class of voting
shares of the Company outstanding) rather than some lesser percentage. In such
circumstances, the merger could be effected without any shareholder vote and
without observing the "fairness" requirements of the Protection Act. If the
Purchaser were to acquire at least 90% but less than 95% of the Common Stock,
then it might nevertheless determine to effect a short form merger, although in
such circumstances the Protection Act would purport to impose the aforementioned
"fairness" requirements.
Unless and until the Purchaser acquires at least 90% of the Common Stock,
any merger with the Company would require the approval of the Company's
shareholders under the NCBCA and the Company's Articles of Incorporation. The
NCBCA generally provides that the affirmative votes of the voting group cast at
a shareholders' meeting at which a quorum is present (either in person or by
proxy) must exceed the negative votes cast by such voting group to effect
routine stockholder action other than the election of directors, which requires
only a plurality vote. For a merger, the NCBCA requires the affirmative vote of
a majority of the shares of any voting group entitled to vote on the
transaction. The NCBCA permits a corporation to require a greater vote in its
articles of incorporation or bylaws. Under the Company's Articles of
Incorporation, the affirmative vote of 80% of outstanding capital stock is
required to merge the Company with another entity. In addition, upon a merger,
without the approval of the Board of Directors, the Company's Articles of
Incorporation provide that the Shareholders have the right (a "Poison Put"),
during the one-year period after the effective date of the merger, to exchange
their stock for any acquiring company's promissory notes payable in 30 days and
bearing interest at the rate of 12% per annum in the principal amount of 200% of
the higher of: (a) the market value of the stock as of the effective date of the
corporate action or (b) the book value of such stock as of the end of the month
immediately preceding such corporate action. The "fairness" requirements of the
Protection Act, detailed above, also would purportedly apply to such a merger.
Section 55-9A-06 of the NCBCA, which is part of The North Carolina Control
Share Acquisition Act (the "Control Act"), provides a right of redemption for
the shareholders of a "covered corporation" (such as the Company) following a
vote of the shareholders to accord voting rights to "control shares" acquired in
a "control share acquisition." The Control Act by its terms would apply to a
non-exempt acquisition by the Purchaser of 20% of all outstanding Shares in the
present circumstances and would apply, therefore, to consummation of the Offer
upon satisfaction of the Minimum Tender Condition. For this reason, the Offer is
subject to the Voting Rights Condition. The Purchaser intends to comply with the
Control Act in pursuing the Offer. Among other things, this means that the
Purchaser expects to honor the redemption rights provided for by statute.
Section 55-9A-06, as applied to the Offer, provides that all Shareholders (other
than holders of control shares) have the right to have their shares redeemed by
the Company at the fair value of those shares as of the day prior to the date on
which Shareholders voted to accord voting rights to the control shares. Such
right is exercisable at any time within 30 days
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after the date on which the Shareholder receives notice from the Company of such
holder's right of redemption. The Company has an additional 30 days from its
receipt of the Shareholder's demand for payment within which to effect
redemption. For further information about the Control Act, see Section 17 of
this Offer to Purchase.
In view of these requirements of statutory law and of the Company's
Articles of Incorporation, the Purchaser may not pursue a merger with the
Company unless and until it acquires at least 80% of the Common Stock.
Alternatively, upon acquiring control of the Company, the Purchaser might seek
to amend the Company's Articles of Incorporation to eliminate the Poison Put
provision and thereafter propose a merger. Such course of action would require
the approval of the holders of a majority of the Shares then outstanding. Unless
the Purchaser had acquired at least 95% of the Shares, the "fairness" provisions
of the Protection Act also would apply by their terms.
In any merger scenario involving the Purchaser and the Company, the timing
and other details of the transaction would depend upon a variety of factors such
as general economic conditions and prospects, the future prospects, asset value
and earnings of the Company, the number of Shares acquired by the Purchaser
pursuant to the Offer or otherwise and the statutory requirements described
above. The Purchaser can give no assurance that a merger or other business
combination will be proposed or that, if proposed, will not be delayed or
abandoned. The Purchaser expressly reserves the right not to propose any merger
or other business combination involving the Company or to propose a merger or
other business combination on terms other than those set forth herein. Its
ultimate decision could be affected by information hereafter obtained by the
Purchaser, changes in general economic or market conditions or in the business
of the Company or other factors.
Shareholders do not have dissenters' rights as a result of the Offer.
Shareholders who do not vote in favor of a merger do have certain rights
pursuant to Article 13 of the NCBCA to dissent and demand determination of, and
to receive payment in cash of the fair value of, their Shares. If the statutory
procedures were satisfied, then the assertion of such rights could lead to a
judicial determination of the fair value required to be paid in cash to such
dissenting holders for their Shares. Any such judicial determination of the fair
value of the Shares or the market value of their Shares could be more or less
than the Offer price or the price provided for in a merger. Section 55-13-01 of
the NCBCA defines "fair value" as the value of the shares immediately before the
effectuation of the transaction to which the dissenter objects, excluding any
appreciation or depreciation in anticipation of the transaction unless such
exclusion would be inequitable. Such "fair value" of the Shares as finally
determined may be more or less than the consideration to be received by other
Shareholders in a merger. Any Shareholder who asserts dissenters' rights under
the NCBCA, but fails to comply with the statutory requirements of the NCBCA, is
considered to have withdrawn his dissent and demand for payment.
The foregoing summary of the rights of dissenting Shareholders does not
purport to be a complete statement of the procedures to be followed by
Shareholders desiring to exercise dissenters' rights. Failure to follow the
steps required by the NCBCA for perfecting dissenters' rights may result in the
loss of such rights.
Except as set forth in this Offer to Purchase, based on their current
knowledge of the Company neither the Purchaser nor Kuhlman has any specific
plans or proposals with respect to any extraordinary corporate transaction such
as a merger, reorganization or liquidation involving the Company or any of its
subsidiaries, a sale or transfer of a material amount of assets of the Company
or any of its subsidiaries, any change in the present board of directors or
management of the Company, any material change in the present capitalization,
corporate structure, dividend policy or business of the Company or causing a
class of securities of the Company to be delisted from NASDAQ or to become
eligible for termination of registration pursuant to Section 12(g)(4) of the
Exchange Act. Upon acquiring control of the Company, however, the Purchaser
intends to initiate a thorough review of the Company and its assets, corporate
structure, capitalization, operations, properties, policies, management and
personnel. After the completion of such review, the Purchaser will determine
what actions or changes, if any, would be desirable in light of the
circumstances that then exist. The Purchaser expressly reserves the right to
effect such actions or changes.
13. SOURCE AND AMOUNT OF FUNDS. If the Purchaser purchases all Shares
subject to the Stock Option Agreement, and if all of the Shares (including
Shares underlying Outstanding Options but excluding Shares subject to the Stock
Option Agreement) are tendered pursuant to the Offer and accepted for purchase,
then the total amount of funds required by the Purchaser to purchase such Shares
and to pay related fees and expenses would be approximately $35 million. The
Purchaser expects to obtain all funds needed to consummate the Stock Option
Agreement and the Offer by means of one or more capital contributions to be made
by Kuhlman to the Purchaser.
Kuhlman plans to use funds available in its cash accounts, together with
bank borrowings, to make capital contributions in amounts sufficient to fund the
approximately $35 million required to consummate the Stock Option Agreement and
the Offer. Kuhlman has received commitment letters dated November 28, 1995 from
NationsBank of Georgia, N.A. and The
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Chase Manhattan Bank, N.A. (the "Banks"), pursuant to which each of the Banks
has agreed to provide up to $17.5 million (or a total of $35 million) of
financing to pay for the acquisition of the Company, ongoing working capital
needs arising in connection with such acquisition and costs and expenses of such
acquisition (the "Commitment Letters"). The obligations of the Banks under the
Commitment Letters are subject to terms and conditions typical of financings of
such type and magnitude, including, for example, the negotiation, execution and
delivery of definitive documentation, the absence of any material adverse change
with respect to Kuhlman and satisfactory completion of due diligence. Kuhlman
expects to repay its obligations to the Banks with funds provided by cash flows
from operating activities.
The foregoing is a summary of certain provisions of the Commitment Letters,
the full texts of which have been filed as exhibits to the Schedule 14D-1 filed
with the Commission by the Purchaser in connection with the Offer. Such summary
is qualified in its entirety by reference to such exhibits, which are available
for inspection (and copies of which may be obtained) at the same places and in
the same manner as set forth with respect to the information concerning the
Company in Section 8 of this Offer to Purchase (except that they will not be
available at the regional offices of the Commission). If and when a definitive
agreement relating to the Commitment Letters is executed, a copy will be filed
as an exhibit to an amendment to the Schedule 14D-1.
14. DIVIDENDS AND DISTRIBUTIONS. If, on or after the Offer Commencement
Date, the Company should declare or pay any cash or stock dividend on the Common
Stock or any other distributions on, or issue any rights with respect to, the
Common Stock, payable or distributable to holders of record on a date prior to
the transfer to the name of the Purchaser, its nominees or transferees on the
Company's stock transfer records of the Shares purchased pursuant to the Offer,
then, without prejudice to the Purchaser's rights under Section 15, (i) the
purchase price per Share payable by the Purchaser pursuant to the Offer shall be
reduced by the amount of any such cash dividend or distribution and (ii) the
whole of any such non-cash dividend, distribution or right shall be received and
held by each tendering Shareholder for the account of the Purchaser and shall be
required to be promptly remitted and transferred by each tendering Shareholder
to the Depositary for the account of the Purchaser, accompanied by appropriate
documentation of transfer. Pending such remittance, 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.
If, on or after the Offer Commencement Date, the Company should (i) split,
combine or otherwise change the Shares or the capitalization of the Company,
(ii) issue or sell any shares of capital stock of any class, or any securities
convertible into any such shares, or any rights, warrants or options to acquire
any such shares or convertible securities, other than Shares issued pursuant to
and in accordance with the present terms of the Outstanding Options, or (iii)
purchase or otherwise acquire any outstanding Shares, then, without prejudice to
the Purchaser's rights under Section 15, the Purchaser, in its sole discretion,
may make such adjustments in the purchase price and other terms of the Offer as
it deems appropriate to reflect such split, combination or other change,
issuance or sale or purchase or other acquisition.
15. CERTAIN CONDITIONS OF THE OFFER. Notwithstanding any other provision of
the Offer, the Purchaser will not be required to accept for payment, purchase or
pay for any Shares tendered, and may terminate or amend the Offer or postpone
the acceptance for payment of and any payment for any Shares not theretofore
accepted for payment or paid for, if (i) the Minimum Tender Condition or the
Voting Rights Condition shall not have been satisfied or (ii) at any time after
the commencement of the Offer, and before the time of payment for any such
Shares, any one or more of the following conditions exist:
(a) any change shall have occurred in the management, business, properties,
condition (financial or otherwise) or results of operations of the Company and
its subsidiaries, considered as one enterprise, that may reasonably be expected
to have a material adverse effect on the management, business, properties,
condition (financial or otherwise) or results of operations of the Company and
its subsidiaries, considered as one enterprise (a "Material Adverse Effect");
(b) any action or proceeding shall be instituted or pending by or before
any court or governmental, administrative or regulatory agency or authority by
any person, or any action or proceeding shall be threatened by any governmental
authority, in any such case that has a reasonable likelihood of success,
challenging the making of the Offer or the acquisition by the Purchaser of any
Shares pursuant to the Offer or the Stock Option Agreement or otherwise having a
Material Adverse Effect;
(c) there shall have occurred (i) any general suspension of trading in, or
limitation on prices for, securities on the New York Stock Exchange or the
NASDAQ National Market System (excluding any trading halt as a result of a
specified decrease in a market index), (ii) a declaration of a banking
moratorium or any suspension of payments in respect of banks in the United
States generally, (iii) an outbreak or escalation of armed hostilities or other
national or international calamity materially involving the United States, (iv)
any limitation (whether or not mandatory) by any governmental authority on, or
any
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<PAGE>
other event that reasonably might be expected to materially affect, the
extension of credit by banks or other financial institutions, or (v) in the case
of any of the foregoing existing at the time of the commencement of the Offer, a
material acceleration or worsening thereof;
(d) legal proceedings shall have been commenced or threatened by any
governmental authority, or any judgment, ruling, order, writ, injunction,
decree, statute, rule or regulation shall have been promulgated, enacted,
entered or deemed applicable to the Offer or the Stock Option Agreement or the
transactions contemplated thereby by any governmental authority or by any court,
other than the application to the Offer or the Stock Option Agreement or the
transactions contemplated thereby of the applicable waiting periods under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR
Act"), that may reasonably be expected to (i) make the acceptance for payment of
or payment for some or all of the Shares pursuant to the Offer or the Stock
Option Agreement illegal or otherwise prohibit or materially restrict
consummation of the Offer or the Stock Purchase Agreement or the transactions
contemplated thereby, (ii) result in a material delay in the ability of the
Purchaser, or render the Purchaser unable, to accept for payment or pay for some
or all of the Shares pursuant to the Offer or the Stock Option Agreement, (iii)
impose any material limitation on the ability of the Purchaser to acquire or
hold or effectively to exercise all rights of ownership of the Shares acquired
pursuant to the Offer and the Stock Option Agreement or (iv) otherwise have a
Material Adverse Effect;
(e) the applicable HSR Act waiting period shall not have expired or been
terminated;
(f) the Company or any of its subsidiaries, joint ventures or partnerships
or other affiliates shall have (i) split, combined or otherwise changed, or
authorized or proposed the split, combination or other change of, the Shares or
its capitalization, (ii) acquired or otherwise caused a reduction in the number
of, or authorized or proposed the acquisition or other reduction in the number
of, any presently outstanding Shares or other securities or other equity
interests, (iii) issued, distributed or sold, or authorized or proposed the
issuance, distribution or sale of, additional Shares, other than Shares issued
or sold upon exercise (in accordance with the present terms thereof) of options
issued pursuant to the Option Plans, shares of any other class of capital stock
or other equity interests, other voting securities, debt securities or any
securities convertible into, or rights, warrants or options, conditional or
otherwise, to acquire, any of the foregoing, (iv) declared, paid or proposed to
declare or pay any cash dividend or other distribution on any shares of capital
stock of the Company (other than stock dividends not exceeding amounts
previously declared by the Company), (v) altered or proposed to alter any
material term of any outstanding security or material contract, permit or
license, (vi) incurred any debt otherwise than in the ordinary course of
business or any debt containing, in the sole judgment of the Purchaser,
burdensome covenants or security provisions, (vii) authorized, recommended,
proposed or entered into an agreement (unless the Purchaser or Kuhlman is party
to such agreement) with respect to any merger, consolidation, recapitalization,
liquidation, dissolution, business combination, acquisition of assets,
disposition of assets, release or relinquishment of any material contractual or
other right of the Company or any of its subsidiaries or any comparable event
not in the ordinary course of business, (viii) entered into any employment,
change in control, severance, executive compensation or similar agreement,
arrangement or plan with or for one or more of its employees, consultants or
directors, or entered into or amended, or made grants or awards pursuant to, any
agreements, arrangements or plans so as to provide for increased benefits to one
or more employees, consultants or directors, or taken any action to fund, secure
or accelerate the funding of compensation or benefits provided for one or more
employees, consultants or directors, whether or not as a result of or in
connection with the transactions contemplated by the Stock Option Agreement and
the Offer, (ix) except as may be required by law, taken any action to terminate
or amend any employee benefit plan (as defined in Section 3(c) of the Employee
Retirement Income Security Act of 1974, as amended) of the Company or any of its
subsidiaries, or the Purchaser shall become aware of any such action not
previously disclosed by the Company in a publicly available filing with the
Commission, or (x) amended or authorized or proposed any amendment to its
Articles of Incorporation or Bylaws or similar organizational documents, or the
Purchaser shall become aware that the Company or any of its subsidiaries shall
have proposed or adopted any such amendment not previously disclosed by the
Company in a publicly available filing with the Commission; or
(g) a tender or exchange offer for any Shares shall be made or publicly
proposed to be made by any person other than the Purchaser or Kuhlman (including
the Company or any of its subsidiaries or affiliates), or it shall be publicly
disclosed or the Purchaser shall otherwise learn that (i) any person, entity
(including the Company or any of its subsidiaries) or "group" (within the
meaning of Section 13(d)(3) of the Exchange Act) other than the Purchaser or
Kuhlman shall have acquired or proposed to acquire beneficial ownership of 5% or
more of any class or series of capital stock of the Company (including the
Shares), through the acquisition of stock, the formation of a group or
otherwise, or shall have been granted any right, option or warrant, conditional
or otherwise, to acquire beneficial ownership of 5% or more of any class or
series of capital stock of the Company (including the Shares) other than
acquisitions for bona fide arbitrage purposes only and except as disclosed in a
Schedule 13D or Schedule 13G on file with the Commission on the date of this
Offer to Purchase, (ii) any person or group
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other than the Purchaser and Kuhlman shall enter into a definitive agreement or
an agreement in principle or make a proposal with respect to a tender or
exchange offer or a merger, consolidation or other business combination with or
involving the Company, or with respect to any amendment of or modification to an
existing such transaction, or (iii) any person other than the Purchaser or
Kuhlman shall file a Notification and Report Form under the HSR Act or make a
public announcement reflecting an intent to acquire the Company or any assets or
securities of the Company;
which, in the sole judgment of the Purchaser in any such case, and regardless of
the circumstances (including any action or inaction by the Purchaser or any of
its affiliates) giving rise to any such condition, makes it inadvisable to
proceed with the Offer or such acceptance for payment or payment.
The foregoing conditions are for the sole benefit of the Purchaser and may
be asserted by the Purchaser regardless of the circumstances (including any
action or inaction by the Purchaser or any of its affiliates) giving rise to any
such condition or may be waived by the Purchaser in whole or in part at any time
and from time to time in its sole discretion. The failure by the Purchaser at
any time to exercise any of the foregoing rights shall not be deemed a waiver of
any such right, the waiver of any such right with respect to particular facts
and circumstances shall not be deemed a waiver with respect to any other facts
and circumstances, and each right shall be deemed an ongoing right that may be
asserted at any time and from time to time. Any determination by the Purchaser
concerning any condition or event described in this Section 15 shall be final
and binding upon all parties.
16. FEES AND EXPENSES. The Purchaser will not pay any fee or commission to
any broker or dealer or any other person (other than the Information Agent as
described below) for soliciting tenders pursuant to the Offer.
Georgeson & Company Inc. has been retained by the Purchaser as Information
Agent in connection with the Offer. The Information Agent may contact and
provide information to Shareholders by mail, telephone, telex, telegraph or
personal interview and may request brokers, dealers and nominees to forward
certain material to beneficial owners. Such firm and the Depositary will each
receive customary compensation from the Purchaser for services relating to the
Offer, will be reimbursed for reasonable out-of-pocket expenses in connection
therewith and will be indemnified against certain liabilities and expenses in
connection with the Offer, including liabilities under the federal securities
laws. Brokers, dealers, firms, commercial banks and trust companies will be
reimbursed by the Purchaser for reasonable and necessary costs and expenses
incurred by them in forwarding material to their customers.
17. CERTAIN LEGAL MATTERS.
GENERAL. Except as described below, based upon the Purchaser's examination
of publicly available filings of the Company, the Purchaser is not aware of any
approval or other action by any federal, state or foreign governmental or
administrative authority that would be required for the acquisition of Shares by
the Purchaser pursuant to the Offer, or of any licenses or other regulatory
permits that appear to be material to the business of the Company and that would
be adversely affected by the acquisition of Shares pursuant to the Offer or
otherwise. Should any such approval or other action be required, it is currently
contemplated that such approval or action would be sought. There is no assurance
that any such approval or action, if needed, would be obtained or taken, or, if
obtained or taken, would not be without substantial conditions, or that adverse
consequences might not result to the business of the Company or that certain
parts of the business of the Company might not have to be disposed of in the
event that such approvals were not obtained or such other actions were not
taken. 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 17. See Section 15.
ANTITRUST. Under the HSR Act and the rules and regulations thereunder (the
"HSR Rules"), a cash tender offeror is not permitted to purchase voting
securities of a target company pursuant to an offer subject to the HSR Act until
the expiration of a 15-day waiting period following the furnishing of certain
required information and documentary material by it to the Antitrust Division of
the United States Department of Justice (the "Antitrust Division") and the
Federal Trade Commission (the "FTC") unless both the Antitrust Division and the
FTC terminate the waiting period prior thereto. If, within that 15-day waiting
period, either the Antitrust Division or the FTC requests additional information
or documentary material relevant to the offer from the cash tender offeror, then
the waiting period is extended until the tenth day after a proper response has
been made to such request. The Purchaser expects to file the required
information and documentary material in connection with the Offer on or before
December 4, 1995, and, accordingly, the required waiting period should expire at
11:59 P.M., Washington, D.C. time, on December 19, 1995, unless the Purchaser
receives a request for additional information or documentary material prior
thereto.
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If the acquisition of Shares is delayed pursuant to a request by the
Antitrust Division or the FTC for additional information or documentary material
pursuant to the HSR Act, then the Offer may, but need not, be extended, and in
any event the purchase of and payment for Shares will be deferred until ten days
after the Purchaser submits a proper response to such request, unless the 10-day
extended period expires on or before the date when the initial 15-day period
would otherwise have expired or unless the waiting period is sooner terminated
by the Antitrust Division or the FTC. Any such extension will not give rise to
any withdrawal rights not otherwise provided for by applicable law.
The Antitrust Division and the FTC frequently scrutinize the legality under
the antitrust laws of transactions such as the Purchaser's proposed acquisition
of Shares pursuant to the Offer. Although Kuhlman and the Company engage in some
related businesses, the Purchaser does not believe the acquisition of Shares
pursuant to the Offer will lessen competition or result in a violation of any
applicable antitrust laws. Nevertheless, at any time before or after the
Purchaser's purchase of Shares pursuant to the Offer, either the Antitrust
Division or the FTC could take such action under the antitrust laws as it deems
necessary or desirable in the public interest, including seeking to enjoin the
purchase of Shares pursuant to the Offer or seeking the divestiture of Shares
acquired by the Purchaser or the divestiture of substantial assets of either
Kuhlman or the Company. Private parties may also bring legal actions under the
antitrust laws. The Purchaser cannot predict what the result would be or what
delay might ensue if such a challenge were made. Accordingly, if any such action
or proceeding by the Antitrust Division, the FTC or any other person should be
threatened, instituted or pending, the Purchaser could decline to accept payment
and pay for any Shares tendered. See Section 15 for certain conditions to the
Offer, including conditions with respect to litigation and certain governmental
actions.
STATE TAKEOVER STATUTES. A number of states have adopted state "takeover"
statutes and regulations that purport, to varying degrees, to apply to attempts
to acquire securities of corporations that are incorporated or have substantial
assets, stockholders, principal executive offices or a principal place of
business in such states. Except for the North Carolina Statutes discussed below,
the Purchaser does not believe that any of these statutes will by their terms
apply to the Offer, and the Purchaser may not have complied with certain of
these statutes. The Purchaser reserves the right to challenge the applicability
of any state law purporting to apply to the Offer (including the North Carolina
Statutes). Nothing in this Offer to Purchase nor any action taken in connection
herewith is intended as a waiver of such right. To the extent that certain
provisions of these statutes or regulations may purport to apply to the Offer,
the Purchaser believes that there are reasonable bases for contesting such
statutes or regulations. If it were to be asserted that one or more state
takeover statutes or regulations apply to the Offer, and if an appropriate court
were not to determine that such statutes or regulations are inapplicable or
invalid as applied to the Offer, then the Purchaser might be required to file
certain information with or to receive approvals from the relevant state
authorities, and the Purchaser might be unable to accept for payment or pay for
Shares tendered pursuant to the Offer, or might be delayed in continuing or
consummating the Offer. In such a case, the Purchaser might not be obligated to
accept for payment or pay for any tendered Shares.
THE NORTH CAROLINA STATUTES. The North Carolina Tender Offer Disclosure Act
(the "Disclosure Act"), the Protection Act and the Control Act (collectively,
the "North Carolina Statutes") purport to regulate tender offers.
The Disclosure Act applies to tender offers for equity securities of a
company that has its principal place of business and substantial assets in North
Carolina. It purports to require the Purchaser to file a statement with the
Securities Division of the North Carolina Department of State (the "North
Carolina Securities Division") relating to the Offer, and it contains
prohibitions against deceptive practices in connection with making a tender
offer. In EURE V. GRAND METROPOLITAN LIMITED, the North Carolina Superior Court
held that the Disclosure Act's 30-day waiting period prior to the commencement
of a tender offer is preempted by the Exchange Act and unenforceable. The
Purchaser believes that the Disclosure Act is unconstitutional as applied to the
Offer. Without conceding the constitutionality of the Disclosure Act, however,
the Purchaser has filed a copy of the Schedule 14D-1 relating to the Offer to
the North Carolina Securities Division pursuant to the Disclosure Act. If the
North Carolina Securities Division takes action under the Disclosure Act, then
the Purchaser might not be obligated to accept for payment or pay for Shares
tendered pursuant to the Offer. In such a case, the Purchaser might, among other
things, terminate the Offer or amend the terms and conditions of the Offer. See
Section 15.
The Protection Act purports to regulate certain business combinations of
certain public corporations organized under North Carolina law, such as the
Company, with a shareholder beneficially owning 20% or more of the voting stock
of such corporation after the date the relevant person or entity first becomes a
20% shareholder. The statute provides, with certain exceptions, that such a
corporation shall not engage at any time in any business combination with such a
shareholder without approval of the holders of 95% of the outstanding shares
(other than the shares owned by the 20% shareholder). Although the Purchaser is
not aware of any judicial decision with respect to the constitutionality of the
Protection Act, it believes that such statute may be unconstitutional. Without
conceding the constitutionality of the Protection Act, however, the Purchaser
intends
21
<PAGE>
to attempt to comply with the statute in pursuing any merger with the Company
following consummation of the Offer. The Protection Act does not by its terms
apply to the Offer itself. For further information about the Protection Act, see
Section 12 of this Offer to Purchase.
The Control Act provides that an entity that acquires "control shares" of a
publicly held North Carolina corporation may not vote those shares unless a
majority of all the outstanding shares of the corporation (not including
"interested shares") entitled to vote for the election of directors adopts a
resolution to accord voting rights to the control shares. An entity acquires
control shares whenever it acquires shares that would bring its voting power in
the corporation to one of three thresholds: 20%, 33 % or 50%. As used in the
Control Act, the term "interested shares" means shares of the corporation
beneficially owned by any person who has acquired or proposes to acquire control
shares in a control share acquisition, by any officer of the corporation or by
any employee of the corporation who is also a director of the corporation. The
disinterested shareholders decide whether to accord votes to such shares at the
corporation's next shareholders' meeting, unless the acquiror requests
management to hold a special meeting of shareholders for such purpose and files
a statement divulging certain information about itself and its intended plans.
If such a meeting is requested, it must be held within 50 days of such request.
If the disinterested shareholders accord voting rights to the control shares and
the acquiror owns a majority of all shares, then any minority shareholder may
dissent and receive the "fair value" for his shares (not less than the highest
price paid by the acquiror for any control shares).
Although the Purchaser is not aware of any judicial decision with respect
to the constitutionality of the Control Act, it believes that such statute may
be unconstitutional as applied to the Offer. Without conceding the
constitutionality of the Control Act, the Purchaser intends to attempt to comply
with the Control Act in pursuing the Offer. In this connection, the Purchaser
has delivered an "acquiring person statement" to the Company as required by the
Control Act and has requested a special meeting of shareholders of the Company
as permitted by the Control Act. The Purchaser expects the Company to honor such
request by calling, within ten days hereof, a special meeting of its
shareholders to be held no sooner than 30 days and no later than 50 days from
the date hereof. The Control Act states that notice of the special meeting must
be given as promptly as reasonably practicable and must include the Purchaser's
acquiring person statement, a statement of the position or recommendation of the
Company Board of Directors (or a statement that the Company Board of Directors
is taking no position or making no recommendation) with respect to granting
voting rights to the control shares and a statement describing Shareholders'
rights of redemption and the procedure for exercising such rights.
The Purchaser and Kuhlman believe that they will accordingly satisfy the
requirements of the Control Act. If legal action is nevertheless commenced
against the Purchaser or Kuhlman under the Control Act, then the Purchaser might
not be obligated to accept for payment or pay for Shares tendered pursuant to
the Offer. In such a case, the Purchaser might, among other things, terminate
the Offer or amend the terms and conditions of the Offer. See Section 15.
18. MISCELLANEOUS. The Offer is not being made to, nor will tenders be
accepted from or on behalf of, Shareholders in any jurisdiction in which the
Offer or the acceptance thereof would not be in compliance with the securities
laws of such jurisdiction, but the Purchaser may, in its sole discretion, take
such action as it may consider necessary to make the Offer in any such
jurisdiction and extend the Offer to Shareholders in such jurisdiction. No
person has been authorized to give any information or make any representation on
behalf of the Purchaser not contained in the Offer, and, if given or made, such
information or representation must not be relied upon as having been authorized.
The Purchaser has filed with the Commission a Schedule 14D-1, together with
exhibits, pursuant to Rule 14d-3 of the General Rules and Regulations under the
Exchange Act, furnishing certain additional information with respect to the
Offer. Such Schedule 14D-1 may be examined and copies may be obtained at the
same places and in the same manner as set forth with respect to the information
concerning the Company in Section 8 of this Offer to Purchase (except that it
will not be available at the regional offices of the Commission).
KUHLMAN ACQUISITION CORP.
November 29, 1995
22
<PAGE>
Annex A
DIRECTORS AND EXECUTIVE OFFICERS
OF THE PURCHASER
The names and titles of the directors and executive officers of the
Purchaser and their principal occupations or employments during the last five
years are set forth below. The address of each such director and executive
officer is 3 Skidaway Village Square, Savannah, Georgia 31411. All directors and
officers listed below are citizens of the United States.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OR EMPLOYMENT AND FIVE-YEAR
NAME AND TITLE EMPLOYMENT HISTORY
<S> <C>
Robert S. Jepson, Jr. See description in Annex B.
Chairman of the Board, Chief
Executive Officer and Director
Curtis G. Anderson See description in Annex B.
President and Director
Vernon J. Nagel See description in Annex B.
Vice President and Treasurer
Richard A. Walker See description in Annex B.
Secretary
Ward D. Richards Mr. Richards, who was elected as Assistant
Assistant Secretary Secretary of the Purchaser on October 1,
1995, has served as Senior Corporate
Attorney of Kuhlman since 1993. From
August 1991 to August 1993, Mr. Richards
served as Corporate Attorney for Kuhlman.
Prior thereto, he was an associate in the
law firm of Wyatt, Tarrant & Combs.
Jeffrey R. Samuels Mr. Samuels, who was elected as Assistant
Assistant Treasurer Treasurer of the Purchaser on October 1,
1995, has served as Director of Finance
since May 1993. From April 1989 to May
1993, he was Controller of Burns Aerospace
Corporation.
</TABLE>
A-1
<PAGE>
Annex B
DIRECTORS AND EXECUTIVE OFFICERS
OF KUHLMAN
The names and titles of the directors and executive officers of Kuhlman and
their principal occupations or employments during the last five years are set
forth below. Except as otherwise indicated below, the address of each such
director and executive officer is 3 Skidaway Village Square, Savannah, Georgia
31411. All directors and officers listed below are citizens of the United
States.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND
NAME AND TITLE FIVE-YEAR EMPLOYMENT HISTORY
<S> <C>
Robert S. Jepson, Jr. Mr. Jepson, who was elected President and Chief Executive
Chairman of the Board, Chief Officer of Kuhlman on February 10, 1993, and Chairman of
Executive Officer and Director the Board on June 9, 1993, founded and was Chairman and
Chief Executive Officer of The Jepson Corporation from
1983 until its sale in 1989. The Jepson Corporation was a
diversified manufacturing company listed on the New York
Stock Exchange. Immediately preceding his election as
President and Chief Executive Officer of Kuhlman, Mr.
Jepson was, and is currently, Chairman and Chief
Executive Officer of Jepson Associates, Inc., a private
investment company. He currently serves as a director of
The Washington Water Power Company and Savannah Foods &
Industries, Inc.
Curtis G. Anderson Mr. Anderson, who was elected President and Chief
President, Chief Operating Officer and Director Operating Officer of Kuhlman on April 26, 1994, and
director on September 8, 1993, founded and has been,
since 1986, Chairman of Anderson Capital Corporation, a
private investment company. Prior thereto, he spent 19
years in corporate and investment banking, including 14
years with Citibank and five years with The First
National Bank of Chicago where he served as Executive
Vice President, Head of Financial Products Department.
Gary G. Dillon Mr. Dillon has served as Chairman of the Board, President
Chairman, President and Chief Executive Officer and Chief Executive Officer of Schwitzer, Inc. since June
of Schwitzer, Inc. and Director 1991, having served as President and Chief Executive
Officer since April 1989. Prior thereto, he served as
President and Chief Executive Officer of Household
Manufacturing, Inc. Mr. Dillon currently serves as a
director of Household International, Inc.
Vernon J. Nagel Mr. Nagel joined Kuhlman on April 5, 1993 and was elected
Executive Vice President of Finance, Vice President of Finance, Chief Financial Officer and
Chief Financial Officer and Treasurer Treasurer of Kuhlman on June 9, 1993 and Executive Vice
President of Finance on February 22, 1994. He was the
Vice President of Finance, Chief Financial Officer and
Secretary of Stericycle, Inc. (medical waste management)
from January 1990 until March 1993. Prior thereto, he
served as a Vice President of The Jepson Corporation from
1985 until 1990, including Chief Financial Officer from
1989 until 1990 and Controller from 1986 until 1989.
</TABLE>
B-1
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND
NAME AND TITLE FIVE-YEAR EMPLOYMENT HISTORY
<S> <C>
Richard A. Walker Mr. Walker has served as an Executive Vice President or
Executive Vice President, Chief Administrative Officer, in a similar position with Kuhlman since 1991.
General Counsel and Secretary From 1984 until April 1991, Mr. Walker served as Vice
President, General Counsel and Secretary of Kuhlman.
Prior thereto, he was a partner in the law firm of
Harness, Dickey & Pierce.
John Zvolensky, Jr. Mr. Zvolensky has served as President and Chief Executive
President and Chief Executive Officer of Officer of Kuhlman Electric Corporation since July 31,
Kuhlman Electric Corporation 1995. From July 1994 until joining Kuhlman Electric, he
was General Manager and Chief Operating Officer of the
Greater Cleveland Growth Association. From January 1992
to September 1993, he was President of WCI Cabinet Group,
a division of White Consolidated Industries. From 1987 to
1991, Mr. Zvolensky was President and Chief Executive
Officer of Emerson Quiet Cool.
William E. Burch Mr. Burch has been a consultant from 1982 to the present
Director and currently serves as a director of Atkinson Company.
From 1984 to 1993, he was counsel to the law firm of
Lukins & Annis in Spokane, Washington. From 1981 to 1984,
he served as Vice Chairman of Fred S. James & Co.
(insurance brokers). From 1975 to 1981, he served that
company as President and Chief Executive Officer.
Steve Cenko Mr. Cenko has been a consultant from 1985 to the present.
Director From 1980 to 1985 he served as President of Lamb Systems
Group (engineering, manufacturing and marketing of
machine tools) and as a director and Executive Vice
President of Lamb Technicon Corporation (holding
company).
Alexander W. Dreyfoos, Jr. Mr. Dreyfoos is currently serving as Chairman of the
Director Board of Photo Electronics Corporation (broadcasting) and
WPEC TV (Palm Beach, Florida) and has served continuously
in those positions since 1963 and 1973, respectively.
William M. Kearns, Jr. Mr. Kearns is currently President of W.M. Kearns & Co.,
Director Inc. (private investment company). He was associated with
Lehman Brothers (investment banking) and its predecessor
firms for more than 33 years. From 1992 to 1994 he was an
Advisory Director of Lehman Brothers and from 1969
through 1992 he was a Managing Director of that firm. He
also serves as a director of Selective Insurance Group,
Inc. and Mountasia Entertainment International, Inc.
Robert D. Kilpatrick Mr. Kilpatrick currently serves as a director of United
Director Companies Financial Corporation. He retired as Chairman
of the Board and Chief Executive Officer of CIGNA
Corporation (insurance) in 1989 and 1988, respectively.
He served in various executive positions with CIGNA prior
thereto.
John L. Marcellus, Jr. Mr. Marcellus currently serves as a director of Southern
Director Financial Federal Savings Bank. He retired as Chairman,
President and Chief Executive Officer of Oneida Ltd.
(tableware manufacturing) in 1986.
</TABLE>
B-2
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND
NAME AND TITLE FIVE-YEAR EMPLOYMENT HISTORY
<S> <C>
George J. Michel, Jr. Mr. Michel has been a private investor and consultant and
Director Chairman of Windstar International, Inc. (management
consulting) from 1990 to the present. Prior to 1990, he
was Chairman of Stanadyne, Inc. (diversified manufacturer
of fabricated metal products) from 1985 to 1989 and Chief
Executive Officer of the same corporation from 1988 to
1989.
General H. Norman Schwarzkopf General Schwarzkopf currently serves as a director of
Director Borg Warner Security Corporation and The Washington Water
Power Company and is active as an author, lecturer and TV
consultant. He retired in August 1991 as a Four-Star
General in the U.S. Army after having served as Commander
in Chief, United States Central Command, Department of
Defense, and Commander of Operations Desert Shield and
Desert Storm.
</TABLE>
B-3
<PAGE>
Facsimile copies of the Letter of Transmittal will be accepted. The Letter
of Transmittal and certificates for Shares should be sent or delivered by each
Shareholder or such holder's broker, dealer, bank 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
<TABLE>
<S> <C> <C>
By Mail: By Courier: By Hand:
Wall Street Station 77 Water Street Receive Window
P.O. Box 1023 4th Floor 77 Water Street, Fifth
New York, New York 10268-1023 New York, New York 10005 Floor
New York, New York 10005
By Facsimile:
(212) 701-7636
(212) 701-7637
Confirm Facsimile by Telephone to:
(212) 701-7623
</TABLE>
Any questions or requests for assistance or additional copies of the Offer
to Purchase and the Letter of Transmittal may be directed to the Information
Agent at its address and telephone number set forth below. You may also contact
your local broker, dealer, commercial bank or trust company for assistance
concerning the Offer.
The Information Agent for the Offer is:
GEORGESON
& COMPANY INC.
Wall Street Plaza
New York, New York 10005
(800) 223-2064 (call toll-free)
(212) 440-9800 (banks and brokers call collect)
<PAGE>
EXHIBIT B
SUPPLEMENT DATED JANUARY 23, 1996 TO OFFER TO PURCHASE DATED NOVEMBER 29, 1995
KUHLMAN ACQUISITION CORP.
A WHOLLY-OWNED SUBSIDIARY OF
KUHLMAN CORPORATION
HAS INCREASED THE OFFER PRICE
TO
$14.00 NET PER SHARE
IN ITS
OFFER TO PURCHASE FOR CASH
ANY AND ALL OUTSTANDING SHARES OF COMMON STOCK
OF
COMMUNICATION CABLE, INC.
THE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON THURSDAY, FEBRUARY
15, 1996, UNLESS EXTENDED. TENDERS OF SHARES MAY BE WITHDRAWN AT ANY TIME PRIOR
THERETO AND, UNLESS THERETOFORE ACCEPTED FOR PAYMENT, AT ANY TIME THEREAFTER.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER A NUMBER OF
SHARES THAT, EXCLUDING THE SHARES BENEFICIALLY OWNED BY THE PURCHASER,
CONSTITUTES AT LEAST A MAJORITY OF THE COMMON STOCK OUTSTANDING ON A FULLY
DILUTED BASIS (THE "MINIMUM TENDER CONDITION") AND (2) THE PURCHASER BEING
SATISFIED, IN ITS SOLE DISCRETION, THAT THE NORTH CAROLINA CONTROL SHARE
ACQUISITION ACT HAS BEEN COMPLIED WITH OR IS INVALID OR OTHERWISE INAPPLICABLE
TO THE OFFER AND THAT ALL SHARES THEN OWNED BY THE PURCHASER HAVE, AND ALL
SHARES TENDERED FOR PURCHASE PURSUANT TO THE OFFER WILL HAVE, UPON PURCHASE BY
THE PURCHASER, THE SAME VOTING RIGHTS AS ALL OTHER SHARES NOT CONSTITUTING
"INTERESTED SHARES" WITHIN THE MEANING OF SUCH ACT (THE "VOTING RIGHTS
CONDITION").
IMPORTANT
Any holder of Shares desiring to tender all or any portion of such Shares
should either (1) complete and sign the Letter of Transmittal accompanying the
Offer to Purchase (as defined herein) or a facsimile copy thereof in accordance
with the instructions in the Letter of Transmittal and mail or deliver it with
such holder's stock certificates, and any other required documents, to the
Depositary (or tender such Shares pursuant to the procedure for book-entry
transfer set forth in Section 3 of the Offer to Purchase, if such means are
available to such holder) or (2) request such holder's broker, dealer, bank or
other nominee to effect the transaction for such holder. A holder whose Shares
are registered in the name of a broker, dealer, bank or other nominee must
contact such broker, dealer, bank or other nominee to tender such Shares.
Any holder who desires to tender Shares and whose certificates for such
Shares are not immediately available, or who cannot comply in a timely manner
with the procedure for book-entry transfer of Shares, may tender such Shares by
following the procedure for guaranteed delivery set forth in Section 3 of the
Offer to Purchase.
Questions and requests for assistance or for additional copies of the Offer
to Purchase, this Supplement and the Letter of Transmittal may be directed to
the Information Agent.
The Information Agent for the Offer is:
GEORGESON
& COMPANY INC.
Wall Street Plaza
New York, New York 10005
(800) 223-2064 (call toll-free)
(212) 440-9800 (banks and brokers call collect)
<PAGE>
TO THE SHAREHOLDERS OF
COMMUNICATION CABLE, INC.:
The following information (the "Supplement") amends and supplements the
Offer to Purchase dated November 29, 1995 (the "Offer to Purchase") of Kuhlman
Acquisition Corp., a North Carolina corporation (the "Purchaser") and a
wholly-owned subsidiary of Kuhlman Corporation ("Kuhlman"). The Purchaser has
amended the terms of its offer and is now offering to purchase any and all
outstanding shares (the "Shares") of common stock, par value $1.00 per share
(the "Common Stock"), of Communication Cable, Inc., a North Carolina corporation
(the "Company"), at a price of $14.00 per Share, net to the seller in cash (the
"Offer Price"), upon the terms and subject to the conditions set forth in the
Offer to Purchase, in this Supplement (which in itself amends and restates the
Supplement dated January 17, 1996 to the Offer to Purchase) and in the Letter of
Transmittal accompanying the Offer to Purchase (which, together with any
amendments or supplements hereto or thereto, collectively constitute the
"Offer").
EXCEPT AS OTHERWISE STATED HEREIN, THE TERMS AND CONDITIONS SET FORTH IN
THE OFFER TO PURCHASE AND THE LETTER OF TRANSMITTAL REMAIN APPLICABLE IN ALL
RESPECTS TO THE OFFER. TERMS NOT DEFINED HEREIN HAVE THE MEANINGS SET FORTH IN
THE OFFER TO PURCHASE. THIS SUPPLEMENT SHOULD BE READ IN CONJUNCTION WITH THE
OFFER TO PURCHASE.
Procedures for accepting the Offer and tendering Shares are set forth in
Section 3 of the Offer to Purchase. Tendering Shareholders should use the Letter
of Transmittal previously circulated with the Offer to Purchase. Although the
Letter of Transmittal refers to an Offer Price of $12.00 per Share and does not
mention this Supplement, by using the Letter of Transmittal to tender their
Shares holders will nevertheless receive $14.00 net per Share for each Share
validly tendered and not withdrawn and accepted for payment pursuant to the
Offer, subject to the terms and conditions of the Offer as amended by this
Supplement. Shareholders who have previously validly tendered and not withdrawn
their Shares pursuant to the Offer are not required to take any further action
in order to receive, subject to the conditions of the Offer, the Offer Price of
$14.00 net per Share, if the Shares are accepted for payment and paid for by the
Purchaser pursuant to the Offer.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER A NUMBER OF
SHARES THAT, EXCLUDING THE SHARES BENEFICIALLY OWNED BY THE PURCHASER,
CONSTITUTES AT LEAST A MAJORITY OF THE COMMON STOCK OUTSTANDING ON A FULLY
DILUTED BASIS (THE MINIMUM TENDER CONDITION) AND (2) THE PURCHASER BEING
SATISFIED, IN ITS SOLE DISCRETION, THAT THE NORTH CAROLINA CONTROL SHARE
ACQUISITION ACT HAS BEEN COMPLIED WITH OR IS INVALID OR OTHERWISE INAPPLICABLE
TO THE OFFER AND THAT ALL SHARES THEN OWNED BY THE PURCHASER HAVE, AND ALL
SHARES TENDERED FOR PURCHASE PURSUANT TO THE OFFER WILL HAVE, UPON PURCHASE BY
THE PURCHASER, THE SAME VOTING RIGHTS AS ALL OTHER SHARES NOT CONSTITUTING
"INTERESTED SHARES" WITHIN THE MEANING OF SUCH ACT (THE VOTING RIGHTS
CONDITION). THE OFFER IS ALSO SUBJECT TO OTHER TERMS AND CONDITIONS CONTAINED IN
THE OFFER TO PURCHASE, IN THIS SUPPLEMENT AND IN THE LETTER OF TRANSMITTAL.
THE OFFER DOES NOT CONSTITUTE A SOLICITATION OF PROXIES FOR ANY MEETING OF
THE COMPANY'S SHAREHOLDERS. SUCH SOLICITATIONS ARE TO BE MADE PURSUANT TO
SEPARATE PROXY MATERIALS COMPLYING WITH THE REQUIREMENTS OF SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
The Offer will expire at 5:00 p.m., New York City time, on Thursday,
February 15, 1996, unless extended.
According to the Company's most recent relevant public disclosure, on
January 16, 1996 there were issued and outstanding 2,641,033 Shares, and on that
date there were 239,469 Shares reserved for issuance under various Common Stock
purchase options. (Kuhlman cannot determine how many options are currently
exercisable.) The Company has also disclosed that it has granted to Pentair,
Inc. ("Pentair") an option to purchase up to 300,000 shares of Common Stock at
$13.50 per share, exercisable until February 22, 1996. Kuhlman Acquisition Corp.
owns 315,703 Shares, of which all but 100 Shares have been acquired by purchase
from James R. Fore, the Company's President and Chief Executive Officer.
Assuming that Pentair exercises its option in full but that no other shares of
Common Stock are issued after January 16, 1996 (whether or not issued pursuant
to the exercise of options), the Minimum Tender Condition will be satisfied if
an aggregate of 1,470,517 Shares are validly tendered into the Offer by the
Expiration Date and not withdrawn, with the result that, upon purchase of the
tendered Shares, the Purchaser will own at least 1,786,220 Shares. The actual
number of Shares that constitutes the Minimum Tender Condition will depend on
the Company's capital accounts as they exist when the Offer is consummated. At
the close of business on January 22, 1996, 94,428 Shares had been tendered and
not withdrawn.
THE OFFER TO PURCHASE, THIS SUPPLEMENT AND THE LETTER OF TRANSMITTAL
CONTAIN IMPORTANT INFORMATION WHICH SHOULD BE READ CAREFULLY BEFORE ANY DECISION
IS MADE WITH RESPECT TO THE OFFER.
2
<PAGE>
1. AMENDED TERMS OF THE OFFER; NUMBER OF SHARES. Upon the terms and subject
to the conditions of the Offer, the Purchaser will accept for payment and
purchase any and all Shares that are validly tendered and not properly withdrawn
on or prior to the Expiration Date (as hereinafter defined). The term
"Expiration Date" shall mean 5:00 p.m., New York City time, on Thursday,
February 15, 1996, unless the Purchaser, in its sole discretion, shall have
extended the period of time for which the Offer is open, in which event the term
"Expiration Date" shall mean the latest time and date on which the Offer, as so
extended by the Purchaser, shall expire.
2. WITHDRAWAL RIGHTS. Tenders of Shares made pursuant to the Offer may be
withdrawn at any time prior to the Expiration Date and, unless theretofore
accepted for payment as provided in the Offer to Purchase, at any time after the
Expiration Date.
3. MARKET FOR COMMON STOCK. On January 22, 1996, the last full day of
trading prior to the date of this Supplement, the last sale price for the Common
Stock, as reported by NASDAQ, was $14 1/8 per Share. The high and low closing
sale prices per Share, as reported by NASDAQ for the first quarter (through
January 22, 1996) of the fiscal year ended October 31, 1996, were $14 1/8 and
$8.50 per Share, respectively. SHAREHOLDERS ARE URGED TO OBTAIN CURRENT MARKET
QUOTATIONS FOR THE SHARES.
4. CERTAIN INFORMATION CONCERNING THE COMPANY. Set forth below is certain
selected financial information for the Company for its fiscal year ended October
31, 1995, as excerpted from financial information released to the public by the
Company on December 22, 1995. More comprehensive financial information is
included in periodic reports and in the other documents filed by the Company
with the Commission. The following summary is qualified in its entirety by
reference to such reports and other documents and all of the financial
information and related notes contained therein. Such reports and other
documents may be examined and copies may be obtained from the offices of the
Commission in the manner set forth in the Offer to Purchase.
COMMUNICATION CABLE, INC.
SELECTED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER-SHARE DATA)
<TABLE>
<CAPTION>
YEAR ENDED
OCTOBER 31, 1995
<S> <C>
(UNAUDITED)
Income Statement Information:
Net Sales................................................... $ 56,256
Net Income.................................................. 2,118
Net Income Per Share........................................ .80
</TABLE>
The information concerning the Company contained in this Supplement has
been taken from or is based upon reports and other documents on file with the
Commission or otherwise publicly available. Although the Purchaser has no
knowledge that would indicate that any statements contained herein based on such
documents and records are untrue, it cannot take responsibility for the accuracy
or completeness of the information contained in such reports and other documents
or for any failure by the Company to disclose events that may have occurred or
may affect the significance or accuracy of any such information but are unknown
to the Purchaser.
5. BACKGROUND OF THE OFFER; CONTACTS WITH THE COMPANY. On the afternoon of
January 15, 1996, counsel to the Company informed acquisition counsel to the
Purchaser and Kuhlman that the Company had begun merger negotiations with
Pentair and that a Special Committee of the Board of Directors of the Company
(the "Special Committee") was even then on the verge of signing a letter of
intent with Pentair. Acquisition counsel to the Purchaser and Kuhlman
immediately placed a telephone call to counsel to the Special Committee. When he
could not make personal contact, he left an oral message, confirmed by
telecopier within minutes in the following letter:
3
<PAGE>
MOST URGENT
Gerald Roach, Esq.
Smith Anderson, et. al.
Raleigh, North Carolina
Dear Mr. Roach:
I am writing to confirm the substance of the message that I left in
your office voice mail at approximately 3:25 p.m. today.
On behalf of Kuhlman Corporation, I hereby request that Communication
Cable, Inc. discuss with Kuhlman the proposed terms and conditions of the
letter of intent or any other agreement that CCI is negotiating with
Pentair before committing to that agreement or any other understanding
looking toward a business combination with Pentair. As you know, Kuhlman
Corporation has a history of negotiations with CCI relative to a business
combination. Kuhlman Corporation has a tender offer pending with an offered
price of $12.00 per share. Kuhlman Corporation has reserved the right to
increase or decrease the offered price at any time. Kuhlman Corporation is
even now a very substantial shareholder of CCI.
In view of these considerations, the directors of CCI would best serve
the interest of the shareholders of CCI by discussing the proposed terms
and conditions of the Pentair agreement before committing to that
agreement.
Very truly yours,
/s/ Patrick Daugherty
Patrick Daugherty
The Purchaser and Kuhlman were given no opportunity to discuss the proposed
terms and conditions of the Pentair letter of intent before the Company signed
it. Instead, in the early evening of January 15, 1996, counsel to the Special
Committee informed acquisition counsel to the Purchaser and Kuhlman that Pentair
and the Company had signed a letter of intent looking toward a cash merger at a
price of $13.00 per Share.
Later that same evening, acquisition counsel to the Purchaser and Kuhlman
informed counsel to the Special Committee that Kuhlman had decided to increase
the purchase price for Shares tendered into the Offer to $13 1/16 per Share.
At approximately 8:00 a.m. on January 16, 1996, acquisition counsel to the
Purchaser and Kuhlman delivered the following letter to counsel to the Special
Committee:
Dear Mr. Roach:
This will confirm the substance of the telephone conversation that I
initiated with you last night following my receipt of a copy of the letter
of intent signed yesterday afternoon by Pentair, Inc. ("Pentair") with your
client, Communication Cable, Inc. ("CCI"), and a copy of CCI's press
release announcing the signing of that letter of intent.
On November 29, 1995, through a wholly-owned subsidiary, Kuhlman
Corporation ("Kuhlman") commenced a tender offer for any and all
outstanding common shares of CCI at a purchase price of $12.00 per share,
net to the seller in cash, upon the terms and conditions stated in an Offer
to Purchase and related Letter of Transmittal. In doing so Kuhlman reserved
the right at any time or from time to time to amend its tender offer in any
respect.
The letter of intent and press release referred to above stipulate a
price of $13.00 per share to be paid to CCI's shareholders in the cash
merger contemplated by CCI and Pentair.
I hereby confirm to you my oral advice that Kuhlman has decided to
increase the consideration payable for shares tendered into its offer to
$13 1/16 per share.
I am speaking on behalf of Kuhlman with the intention and expectation
of inducing reliance by CCI and CCI's directors, officers and professional
advisers, including you. Kuhlman's as-yet-unannounced decision to increase
the consideration payable in its tender offer to $13 1/16 per share is
irrevocable prior to announcement. Payment of that purchase price (or any
other purchase price) will of course be subject to the terms and conditions
of the Offer to Purchase and related Letter of Transmittal as the same may
be amended.
4
<PAGE>
In these particular circumstances, Kuhlman demands that CCI's Board of
Directors (i) withdraw its support for the merger proposed by Pentair, (ii)
refuse to sign a definitive merger agreement with Pentair, (iii) reevaluate
Kuhlman's bid (with a view to endorsing that bid) in light of the increase
in the purchase price offered by Kuhlman and (iv) instruct CCI's officers,
employees and professional advisers immediately to complete, file with the
SEC and disseminate to CCI's shareholders the definitive version of the
proxy statement relating to the shareholder meeting required by the North
Carolina Control Share Acquisition Act. Kuhlman expects CCI's directors to
proceed fairly and impartially, endeavoring to maximize shareholder value,
in execution of their legal duties.
Very truly yours,
/s/ Patrick Daugherty
Patrick Daugherty
During the afternoon of January 16, 1996, counsel to the Special Committee
informed acquisition counsel to the Purchaser and Kuhlman that the Special
Committee was considering the demands enumerated in such letter.
At approximately 9:00 p.m. on January 18, 1996, counsel to the Special
Committee advised acquisition counsel to the Purchaser and Kuhlman that Pentair
was understood to be considering a merger offer at $13.50 per Share. Acquisition
counsel replied immediately that Kuhlman was "definitely interested" in
responding to such a bid.
At approximately 10:55 a.m. on Friday, January 19, 1996, acquisition
counsel to the Purchaser and Kuhlman telephoned counsel to the Special
Committee, reiterated Kuhlman's strong interest in responding to a $13.50 bid
and indicated that Kuhlman would be in a position to respond on Monday.
Acquisition counsel stated that it would be imprudent for the Special Committee
or the Board to act on a definitive merger agreement before Kuhlman could
respond to the merger proposal.
At approximately 12:30 p.m., counsel to the Special Committee telephoned
acquisition counsel and advised him that the Special Committee had decided to
give both Pentair and Kuhlman until 12:00 noon on Monday to make their best and
final offers.
At approximately 3:00 p.m. on Friday, January 19, 1996, counsel to the
Special Committee telephoned acquisition counsel to the Purchaser and Kuhlman,
advised him that Pentair had issued an "ultimatum" requiring the Company to
respond by 4:00 p.m. that same day and told him that Kuhlman had one hour to
submit its own improved bid. Acquisition counsel replied that the accelerated
deadline was unfair and unreasonable and demanded that the Company not respond
to Pentair's ultimatum.
On the afternoon of January 20, 1996, counsel to the Special Committee
reported to acquisition counsel to the Purchaser and Kuhlman in a telephone
conversation that the Special Committee and the Board had taken some action, to
be announced early Monday morning, at a cost to the Company that would not
preclude a response by Kuhlman.
Counsel to the Special Committee delivered a copy of the signed Merger
Agreement to acquisition counsel to the Purchaser and Kuhlman on the morning of
January 22, 1996, concurrently with the Company's issuance of a press release
announcing such agreement.
6. THE STOCK OPTION AGREEMENT. On January 2, 1996, Kuhlman exercised its
option to acquire all 315,603 of Mr. Fore's Shares at a purchase price of $12.00
per Share.
7. SOURCE AND AMOUNT OF FUNDS. The Purchaser has purchased all 315,603
Shares subject to the Stock Option Agreement at an aggregate purchase price of
$3,787,236. If all of the remaining Shares subject to the Offer (including
Shares underlying outstanding options) are tendered into the Offer and accepted
for purchase, then the total amount of funds required by the Purchaser to
purchase such Shares pursuant to the Offer and to pay related fees and expenses
would be approximately $41 million. The Purchaser expects to obtain all funds
needed to consummate the Stock Option Agreement and the Offer by means of
capital contributions made by Kuhlman to the Purchaser. Kuhlman plans to use
funds available in its cash accounts, together with borrowings from its Banks,
to make capital contributions in an amount sufficient to consummate the Offer.
8. CERTAIN CONDITIONS OF THE OFFER. The Purchaser hereby waives conditions
(a), (f) and (g), as stated in Section 15 of the Offer to Purchase, as they
relate to all negotiations, agreements and other circumstances relating to
Pentair's interest in the Company, as summarized in the introduction to this
Supplement and in Section 5 hereof, to the extent that such negotiations,
agreements and other circumstances have been disclosed in reports and schedules
filed by the Company with the Commission.
5
<PAGE>
9. CERTAIN LEGAL MATTERS. On December 13, 1995, the FTC ordered early
termination, effective that same day, of the waiting period under the HSR Act
and the HSR Rules with respect to the proposed acquisition of the Shares.
KUHLMAN ACQUISITION CORP.
January 23, 1996
6
<PAGE>
Facsimile copies of the Letter of Transmittal will be accepted. The Letter
of Transmittal and certificates for Shares should be sent or delivered by each
Shareholder or such holder's broker, dealer, bank 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
<TABLE>
<S> <C> <C>
By Mail: By Courier: By Hand:
Wall Street Station 77 Water Street Receive Window
P.O. Box 1023 4th Floor 77 Water Street, Fifth
New York, New York 10268-1023 New York, New York 10005 Floor
New York, New York 10005
By Facsimile:
(212) 701-7636
(212) 701-7637
Confirm Facsimile by Telephone to:
(212) 701-7623
</TABLE>
Any questions or requests for assistance or additional copies of the Offer
to Purchase, this Supplement and the Letter of Transmittal may be directed to
the Information Agent at its address and telephone number set forth below. You
may also contact your local broker, dealer, commercial bank or trust company for
assistance concerning the Offer.
The Information Agent for the Offer is:
GEORGESON
& COMPANY INC.
Wall Street Plaza
New York, New York 10005
(800) 223-2064 (call toll-free)
(212) 440-9800 (banks and brokers call collect)
<PAGE>
Exhibit C
LETTER OF TRANSMITTAL
TO TENDER SHARES OF COMMON STOCK
OF
COMMUNICATION CABLE, INC.
PURSUANT TO THE OFFER TO PURCHASE DATED NOVEMBER 29, 1995
BY
KUHLMAN ACQUISITION CORP.
A WHOLLY-OWNED SUBSIDIARY OF
KUHLMAN CORPORATION
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON MONDAY, JANUARY 22, 1996, UNLESS EXTENDED.
THE DEPOSITARY FOR THE OFFER IS:
HARRIS TRUST COMPANY OF NEW YORK
<TABLE>
<S> <C> <C>
BY MAIL: BY COURIER: BY HAND:
WALL STREET STATION 77 WATER STREET RECEIVE WINDOW
P. O. BOX 1023 4TH FLOOR 77 WATER STREET, FIFTH FLOOR
NEW YORK, NEW YORK 10268-1023 NEW YORK, NEW YORK 10005 NEW YORK, NEW YORK 10005
BY FACSIMILE:
(212) 701-7636
(212) 701-7637
CONFIRM FACSIMILE BY TELEPHONE TO:
(212) 701-7623
</TABLE>
Delivery of this instrument to an address other than as set forth above, or
transmission via a facsimile number other than as listed above, will not
constitute a valid delivery.
This Letter of Transmittal is to be completed by holders of Shares
("Shareholders" or "holders") either if certificates are to be forwarded
herewith or if delivery is to be made by book-entry transfer to the account
maintained by Harris Trust Company of New York (the "Depositary") at The
Depository Trust Company ("DTC"), the Midwest Securities Trust Company ("MSTC")
or the Philadelphia Depository Trust Company ("PDTC") pursuant to the procedures
set forth in Section 3 of the Offer to Purchase. Each of DTC, MSTC and PDTC is a
"Book-Entry Transfer Facility"; collectively, they are the "Book-Entry Transfer
Facilities." Shareholders who deliver Shares by book-entry transfer are referred
to herein as "Book-Entry Shareholders." Shareholders other than Book-Entry
Shareholders are referred to herein as "Certificate Shareholders." Shareholders
whose certificates are not immediately available or who cannot deliver their
certificates and all other documents required hereby to the Depositary on or
prior to the Expiration Date must tender their Shares according to the
guaranteed delivery procedure set forth in Section 3 of the Offer to Purchase.
See Instruction 2.
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ CAREFULLY THE ACCOMPANYING INSTRUCTIONS.
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
MADE TO THE ACCOUNT MAINTAINED BY THE DEPOSITARY WITH A BOOK-ENTRY TRANSFER
FACILITY AND COMPLETE THE FOLLOWING:
Name of Tendering Institution
Check Box of Applicable Book-Entry Transfer Facility:
[ ] DTC [ ] MSTC [ ] PDTC
Account Number
Transaction Code Number
[ ] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE
FOLLOWING:
Name(s) of Registered Owner(s)
Date of Execution of Notice of Guaranteed Delivery
Name of Eligible Institution that Guaranteed Delivery
If Delivered by Book-Entry Transfer, Check Box of Applicable Book-Entry
Transfer Facility:
[ ] DTC [ ] MSTC [ ] PDTC
Account Number Transaction Code Number
<TABLE>
<S> <C> <C> <C>
DESCRIPTION OF SHARES TENDERED
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S) CERTIFICATE(S) TENDERED
(PLEASE FILL IN, IF BLANK) (ATTACH ADDITIONAL LIST IF NECESSARY)
TOTAL NUMBER
OF SHARES NUMBER OF
CERTIFICATE REPRESENTED BY SHARES
NO(S).* CERTIFICATE(S)* TENDERED**
TOTAL SHARES
* Need not be completed by Book-Entry Shareholders.
** Unless otherwise indicated, it will be assumed that all Shares evidenced by any certificates delivered to the Depositary are
being tendered. See Instruction 4.
</TABLE>
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to Kuhlman Acquisition Corp., a North
Carolina corporation (the "Purchaser") and a wholly-owned subsidiary of Kuhlman
Corporation, a Delaware corporation, the above-described shares (the "Shares")
of common stock, par value $1.00 per share (the "Common Stock"), of
Communication Cable, Inc., a North Carolina corporation (the "Company"),
pursuant to the Purchaser's offer to purchase any and all outstanding Shares at
a price of $12.00 per Share, net to the seller in cash, upon the terms and
subject to the conditions set forth in the Offer to Purchase dated November 29,
1995 (the "Offer to Purchase"), receipt of which is hereby acknowledged, and in
this Letter of Transmittal. The Offer to Purchase and this Letter of Transmittal
together constitute the "Offer." The Purchaser reserves the right to transfer or
assign, in whole or from time to time in part, to one or more of its
subsidiaries or other affiliates the right to purchase Shares tendered pursuant
to the Offer.
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with the terms of the Offer, the
undersigned hereby sells, assigns and transfers to, or upon the order of, the
Purchaser all right, title and interest in and to all of the Shares that are
being tendered hereby (and any and all other Shares or other securities issued
or issuable in respect thereof on or after November 29, 1995 (the "Offer
Commencement Date")) and appoints the Depositary the true and lawful agent and
attorney-in-fact of the undersigned with respect to such Shares (and any such
other Shares or securities), with full power of substitution (such power of
attorney being deemed to be an irrevocable power coupled with an interest), to
(a) deliver certificates for such Shares (and any such other Shares or
securities), or transfer ownership of such Shares on the account books
maintained by a Book-Entry Transfer Facility, or both, together in either such
case with all accompanying evidence of transfer and authenticity, to or upon the
order of the Purchaser, (b) present such Shares (and any such other Shares or
securities) for transfer on the books of the Company and (c) receive all
benefits and otherwise exercise all rights of beneficial ownership of such
Shares (and any such other Shares or securities), all in accordance with the
terms of the Offer.
The undersigned hereby irrevocably appoints Robert S. Jepson, Jr., Curtis
G. Anderson, Vernon J. Nagel and Richard A. Walker, and each of them, the
attorneys and proxies of the undersigned, each with full power of substitution,
to vote in such manner as each such attorney and proxy or his substitute shall
in his sole discretion deem proper, and otherwise act (including pursuant to
written consent) with respect to all of the Shares tendered hereby that have
been accepted for payment by the Purchaser prior to the time of such vote or
action (and any and all other Shares or securities issued or issuable in respect
thereof on or after the Offer Commencement Date), which the undersigned may be
entitled to vote at any meeting of shareholders (whether annual or special and
whether or not an adjourned meeting) of the Company or otherwise. This proxy is
irrevocable and is granted in consideration of, and is effective upon, the
acceptance for payment of such Shares by the Purchaser in accordance with the
terms of the Offer. A tendering Shareholder will retain the voting rights (and
other rights) associated with such holder's Shares upon tendering such Shares in
response to this Offer and at all times thereafter unless and until such Shares
are accepted for payment. Such acceptance for payment shall revoke any other
proxy granted by the undersigned at any time with respect to such Shares (and
any such other Shares or securities), and no subsequent proxies will be given
with respect thereto by the undersigned. All authority herein conferred or
agreed to be conferred shall survive the death or incapacity of the undersigned,
and any obligation of the undersigned hereunder shall be binding upon the heirs,
personal representatives, successors and assigns of the undersigned. Except as
stated above and in the Offer to Purchase, this tender is irrevocable.
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 any and all Shares or other securities issued or issuable
in respect thereof on or after the Offer Commencement Date) and that, when the
same are accepted for payment by the Purchaser, the Purchaser will acquire good
and unencumbered title thereto, free and clear of all liens, restrictions,
charges and encumbrances, and the same will not be subject to any adverse claim.
The undersigned, upon request, will execute and deliver any additional documents
deemed by the Depositary or the Purchaser to be necessary or desirable to
complete the sale, assignment and transfer of the Shares tendered hereby (and
any and all Shares or other securities issued or issuable in respect of such
Shares on or after the Offer Commencement Date).
The undersigned understands that the Purchaser's acceptance for payment of
Shares tendered pursuant to any one of the procedures described in Section 3 of
the Offer to Purchase will constitute a binding agreement between the
undersigned and the Purchaser upon the terms and subject to the conditions of
the Offer.
Unless otherwise indicated herein under "Special Payment Instructions,"
please issue the check for the purchase price and/or return any certificates for
Shares not tendered or accepted for payment in the name(s) of the registered
holder(s) appearing under "Description of Shares Tendered." Similarly, unless
otherwise indicated under "Special Delivery Instructions," please mail the check
for the purchase price and/or return any certificates for Shares not tendered or
accepted for payment (and accompanying documents, as appropriate) to the
address(es) of the registered holder(s) appearing under "Description of Shares
Tendered." In the event that both the Special Delivery Instructions and the
Special Payment Instructions are completed, please issue the check for the
purchase price and/or return any certificates for Shares not tendered or
accepted for payment in the name of, and deliver said check and/or return such
certificates to, the person or persons so indicated. The undersigned recognizes
that the Purchaser has no obligation pursuant to the Special Payment
Instructions to transfer any Shares from the name of the registered holder
thereof if such Purchaser does not accept for payment any of the Shares so
tendered.
SPECIAL PAYMENT INSTRUCTIONS
(See Instructions 1, 5, 6 and 7)
To be completed ONLY if certificates for Shares not tendered or not
purchased and/or the check for the purchase price of Shares purchased are to
be issued in the name of someone other than the undersigned.
Issue check and/or certificates to:
Name
(PLEASE PRINT)
Address
(INCLUDE ZIP CODE)
(TAXPAYER IDENTIFICATION OR SOCIAL SECURITY NUMBER)
SPECIAL DELIVERY INSTRUCTIONS
(See Instructions 1, 5, 6 and 7)
To be completed ONLY if certificates for Shares not tendered or not
purchased and/or the check for the purchase price of Shares purchased are to
be sent to someone other than the undersigned, or to the undersigned at an
address other than that shown on the front cover.
Send check and/or certificates to:
Name
PLEASE PRINT
Address
(INCLUDE ZIP CODE)
(TAXPAYER IDENTIFICATION OR SOCIAL SECURITY NUMBER)
<PAGE>
SIGN HERE
(SIGNATURE(S) OF HOLDER(S) OF SHARES)
Dated , 199
(Must be signed by the 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 trustee(s), executor(s),
administrator(s), guardian(s), attorney(s)-in-fact, officer(s) of
corporation(s) or other(s) acting in a fiduciary or representative capacity,
then please set forth full title(s) and see Instruction 5.)
Name(s)
(PLEASE PRINT)
Capacity (Full Title)
Address
(INCLUDING ZIP CODE)
Area Code and Telephone Number
Taxpayer Identification or Social Security No.
(COMPLETE SUBSTITUTE W-9 ON REVERSE)
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED -- SEE INSTRUCTIONS 1 AND 5)
Authorized Signature
Name
Name of Firm
Address
(INCLUDING ZIP CODE)
Area Code and Telephone Number
Dated , 199
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 an eligible
institution in a recognized Medallion Guarantee Program (an "Eligible
Institution"). An Eligible Institution means a firm or any other entity
identified in Rule 17Ad-15 under the Securities Exchange Act of 1934, as
amended, including (as such terms are defined therein): (i) a bank; (ii) a
broker, dealer, municipal securities dealer, municipal securities broker,
government securities dealer or government securities broker; (iii) a credit
union; (iv) a national securities exchange, registered securities association
or clearing agency; or (v) a savings association. A verification by a notary
public is not acceptable. Signatures on this Letter of Transmittal need not be
guaranteed if this Letter of Transmittal is signed by the registered holder(s)
of the Share certificates submitted herewith and such holder(s) have not
completed either the box entitled "Special Payment Instructions" or the box
entitled "Special Delivery Instructions" on this Letter of Transmittal. See
Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND CERTIFICATES. This Letter of
Transmittal is to be completed by Shareholders either if certificates are to
be forwarded herewith or if tenders of Shares are to be made pursuant to the
procedures for delivery by book-entry transfer set forth in Section 3 of the
Offer to Purchase. Certificates for all Shares tendered physically, or
confirmation of any book-entry transfer into the Depositary's account at a
Book-Entry Transfer Facility of Shares tendered electronically, as well as a
properly completed and duly executed Letter of Transmittal or facsimile
thereof, and any other documents required by this Letter of Transmittal, must
be received by the Depositary at one of its addresses set forth herein on or
prior to the Expiration Date (as defined in the Offer to Purchase).
Shareholders whose certificates are not immediately available or who cannot
deliver their certificates and all other required documents to the Depositary
on or prior to the Expiration Date may tender their Shares by properly
completing and duly executing the Notice of Guaranteed Delivery pursuant to
the guaranteed delivery procedure set forth in Section 3 of the Offer to
Purchase. Pursuant to such procedure, (i) such tender must be made by or
through an Eligible Institution, (ii) a properly completed and duly executed
Notice of Guaranteed Delivery, substantially in the form made available by the
Purchaser, must be received by the Depositary by the Expiration Date and (iii)
the certificates for all Shares (or confirmation of book-entry transfer of
Shares into the Depositary's account at a Book-Entry Transfer Facility),
together with a properly completed and duly executed Letter of Transmittal (or
facsimile thereof) and any other documents required by this Letter of
Transmittal, must be received by the Depositary within three National
Association of Securities Dealers, Inc. Automated Quotation National Market
System trading days after the date of execution of such Notice of Guaranteed
Delivery, all as provided in Section 3 of the Offer to Purchase.
The method of delivery of Shares and all other required documents is at
the option and risk of the tendering Shareholder. If sent by mail, the use of
registered mail with return receipt requested, properly insured, is
recommended.
No alternative, conditional or contingent tenders will be accepted. All
tendering Shareholders, by execution of this Letter of Transmittal (or
facsimile thereof), waive any right to receive any notice of the acceptance of
their Shares for payment.
3. INADEQUATE SPACE. If the space provided herein is inadequate, the
certificate numbers and/or the number of Shares should be listed on a separate
schedule attached hereto.
4. PARTIAL TENDERS. This Instruction 4 is applicable to Certificate
Shareholders only. If fewer than all of the Shares evidenced by any
certificate submitted are to be tendered, fill in the number of Shares that
are to be tendered in the box entitled "Description of Shares Tendered." In
such case, new certificate(s) for the remainder of the Shares that were
evidenced by old certificate(s) will be sent to the registered holder, unless
otherwise provided in the appropriate box on this Letter of Transmittal, as
soon as practicable after the Expiration Date. All Shares represented by
certificates delivered to the Depositary will be deemed to have been tendered
unless otherwise indicated.
5. SIGNATURES ON LETTER OF TRANSMITTAL, POWERS AND ENDORSEMENTS. If this
Letter of Transmittal is signed by the registered holder of the Shares
tendered hereby, then the signature must correspond with the name as written
on the face of the certificate(s) without alteration, enlargement or any
change whatsoever.
If any of the Shares tendered hereby are owned of record by two or more
joint owners, then all such owners must sign this Letter of Transmittal.
If any tendered Shares are registered in different names on several
certificates, then it will be necessary to complete, sign and submit as many
separate Letters of Transmittal as there are different registrations of
certificates.
If this Letter of Transmittal or any certificates or powers of attorney
are signed by trustees, executors, administrators, guardians,
attorneys-in-fact, officers of corporations or others acting in a fiduciary or
representative capacity, then such persons should so indicate when signing,
and proper evidence satisfactory to the Purchaser of their authority so to act
must be submitted.
When this Letter of Transmittal is signed by the registered owner(s) of
the Shares listed and transmitted hereby, no endorsements of certificates or
separate powers of attorney are required unless payment is, or certificates
for Shares not tendered or purchased are, to be issued to a person other than
the registered owner(s). Signatures on such certificates or powers of attorney
must be guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered owner(s) of the certificates listed, then the certificates must be
endorsed or accompanied by appropriate powers of attorney, in either case
signed exactly as the name or names of the registered owner or owners appear
on the certificates. Signatures on such certificates or powers of attorney
must be guaranteed by an Eligible Institution.
<PAGE>
6. TRANSFER TAXES. The Purchaser will pay any transfer taxes with respect
to the transfer and sale of purchased Shares to it or its order pursuant to
the Offer. If, however, payment of the purchase price is to be made to, or if
certificates for Shares not tendered or purchased are to be registered in the
name of, any person other than the registered holder, or if tendered
certificates are registered in the name of any person other than the person(s)
signing this Letter of Transmittal, then the amount of any transfer taxes
(whether imposed on the registered holder or such person) payable on account
of the transfer to such person will be deducted from the purchase price unless
satisfactory evidence of the payment of such taxes or exemption therefrom is
submitted.
Except as provided in this Instruction 6, it will not be necessary for
transfer tax stamps to be affixed to the certificates for Shares listed in
this Letter of Transmittal.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If a check is, and/or
certificates for unpurchased Shares are, to be issued in the name of a person
other than the signer of this Letter of Transmittal, or if a check is to be
sent, and/or such certificates are to be returned, to someone other than the
signer of this Letter of Transmittal or to an address other than that shown
above, then the appropriate boxes on this Letter of Transmittal should be
completed.
8. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Requests for assistance
may be directed to, or additional copies of the Offer to Purchase and this
Letter of Transmittal may be obtained from, the Information Agent at the
address set forth below or from your broker, dealer, commercial bank or trust
company.
9. SUBSTITUTE FORM W-9. The tendering Shareholder is required to provide
the Depositary with a correct Taxpayer Identification Number ("TIN") on
Substitute Form W-9. Failure to provide the information on the form may
subject the tendering Shareholder to 31% federal income tax withholding on the
payment of the purchase price. The box in Part 3 of the form may be checked 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. If the box in Part
3 is checked and the Depositary is not provided with a TIN within 60 days,
then the Depositary will withhold 31% of all payments of the purchase price
thereafter until a TIN is provided to the Depositary.
Important: This Letter of Transmittal (or a manually executed facsimile
copy thereof), together with certificates or confirmation of book-entry
transfer and all other required documents or the Notice of Guaranteed
Delivery, must be received by the Depositary by the Expiration Date (as
defined in the Offer to Purchase).
IMPORTANT TAX INFORMATION
Under federal income tax law, a Shareholder whose tendered Shares are
accepted for payment is required to provide the Depositary with such holder's
correct TIN on Substitute Form W-9 below. If such holder is an individual,
then the TIN is his or her social security number. If the Depositary is not
provided with the correct TIN, then the Shareholder may be subject to a $50
penalty imposed by the Internal Revenue Service. In addition, payments that
are made to such holder with respect to Shares purchased pursuant to the Offer
may be subject to 31% backup withholding.
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, that Shareholder must submit to the Depositary a statement,
signed under penalties of perjury, attesting to that individual's exempt
status. Such statements can be obtained from the Depositary or the Information
Agent. See the enclosed "Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9" for additional instructions.
If backup withholding applies, then the Depositary is required to withhold
31% of any payments made to the Shareholder or other payee. Backup withholding
is not an additional federal income tax. Rather, the federal income tax
liability of persons subject to backup withholding will be reduced by the
amount of such tax withheld. If withholding results in an overpayment of
taxes, then a refund may be obtained from the Internal Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9
In order to prevent backup withholding on payments made to a Shareholder
or other payee with respect to Shares purchased pursuant to the Offer, the
Shareholder is required to notify the Depositary of such holder's current TIN
(or the TIN of any other payee) by completing the form below, certifying that
the TIN provided on Substitute Form W-9 is correct (or that such holder is
awaiting a TIN) and that (1) the Shareholder has not been notified by the
Internal Revenue Service that such holder is subject to backup withholding as
a result of failure to report all interest or dividends or (2) the Internal
Revenue Service has notified the Shareholder that such holder 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 owner of such holder's
Shares. If such Shares are registered in more than one name or are not
registered 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.
<TABLE>
<S> <C> <C>
PAYER'S NAME: HARRIS TRUST COMPANY OF NEW YORK
PART 1 -- Please provide your TIN in the box at Social Security Number(s) or Employer
right and certify by signing and dating below. Identification Number(s)
SUBSTITUTE
FORMW-9
Department of the Treasury
PART 2 -- CERTIFICATES -- Under penalties of perjury, I certify that:
(1) The number shown on this form is my correct taxpayer identification number (or I am waiting for
a number to be issued for me), and
(2) I am not subject to backup withholding because: (a) I am exempt from backup withholding, or (b)
Internal Revenue Service I have not been notified by the Internal Revenue Service (IRS) that I am subject to backup
PAYER'S REQUEST FOR withholding as a result of a failure to report all interest or dividends, or (c) the IRS has
TAXPAYER notified me that I am no longer subject to backup withholding.
IDENTIFICATION
CERTIFICATION INSTRUCTIONS -- You must cross out Part 2 above if you have been notified by the IRS
that you are currently subject to backup withholding because of underreporting interest or
NUMBER (TIN) dividends on your tax return.
SIGNATURE PART 3 --
DATE , 199 Awaiting TIN [ ]
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW
THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART
3 OF THE SUBSTITUTE FORM W-9.
<TABLE>
<S> <C>
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number has not been issued to me, and either (1) I
have mailed or delivered an application to receive a taxpayer identification number to the appropriate Internal Revenue
Service Center or Social Security Administration Office or (2) I intend to mail or deliver an application in the near future.
I understand that if I do not provide a taxpayer identification number by the time of payment, 31% of all payments of the
purchase price made to me thereafter will be withheld until I provide a number.
Signature Date , 199
</TABLE>
Questions and requests for assistance or additional copies of the Offer to
Purchase, the Letter of Transmittal and other tender offer materials may be
directed to the Information Agent as set forth below.
The Information Agent for the Offer is:
GEORGESON
& COMPANY INC.
Wall Street Plaza
New York, New York 10005
(800) 223-2064 (call toll-free)
(212) 440-9800 (banks and brokers call collect)
<PAGE>
COMMUNICATION CABLE, INC.
P R O X Y
THIS PROXY IS SOLICITED ON BEHALF OF KUHLMAN CORPORATION
THE UNDERSIGNED UNDERSTANDS THAT APPROVAL OF THE VOTING RIGHTS PROPOSAL
STATED BELOW IS A CONDITION PRECEDENT TO THE OBLIGATION OF KUHLMAN ACQUISITION
CORP. TO CONSUMMATE ITS TENDER OFFER. The undersigned hereby (i) certifies that
the undersigned is not an officer of Communication Cable, Inc. (the "Company"),
is not an employee of the Company who is also a director of the Company and is
not a person who has acquired or proposes to acquire "control shares" of the
Company in a "control share acquisition" within the meaning of the North
Carolina Control Share Acquisition Act (the "Control Act"), (ii) appoints each
of Robert S. Jepson, Jr., Curtis G. Anderson, Vernon J. Nagel and Richard A.
Walker as Proxies, each with the power to appoint his substitute, and (iii)
authorizes such Proxies to represent and to vote, as designated below, all of
the shares of common stock of the Company held of record by the undersigned on
January 16, 1996 at the special meeting of shareholders to be held on February
16, 1996 or any adjournment thereof (the "Special Meeting"). The undersigned
hereby revokes any earlier proxy given with respect to the Voting Rights
Proposal that is inconsistent with this proxy. Delivery of this proxy to the
Secretary of the Company shall constitute notice of revocation to him.
VOTING RIGHTS PROPOSAL: To grant voting rights to all of the shares of common
stock of the Company at any time acquired by or for Kuhlman Acquisition Corp.,
directly or indirectly, in a "control share acquisition" within the meaning of
the Control Act, including any and all shares that may be acquired by Kuhlman
Acquisition Corp. pursuant to its tender offer to purchase any and all
outstanding shares at $12.00 per share, net to the seller in cash, on the terms
and subject to the conditions set forth in the Offer to Purchase dated November
29, 1995 and the related Letter of Transmittal, as the same may be amended or
supplemented at any time prior to the conclusion of the Special Meeting.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
This proxy when properly executed will be voted in the manner directed herein
by the undersigned shareholder. If no direction is made, then this proxy will be
voted "FOR" the Voting Rights Proposal.
By signing this proxy, the signatory is granting discretionary authority to
the Proxies to vote on any procedural matters that may come before the meeting.
Please sign exactly as name appears below. When shares are held by joint
tenants, both should sign. When signing as attorney, administrator, trustee or
guardian, please give full title as such. If a corporation, then please sign in
full corporate name by president or other authorized officer. If a partnership,
then please sign in partnership name by authorized person.
Dated: , 1996
Signature
Signature if held jointly
PLEASE MARK, SIGN, DATE AND
RETURN THE PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE
<PAGE>
PLEASE READ THE FOLLOWING INSTRUCTIONS BEFORE EXECUTING YOUR VOTING INSTRUCTIONS
ON THE FRONT OF THIS FORM
(Bullet) Review the Notice of Meeting and Proxy Statement and, in
particular, the explanation of the Voting Rights Proposal. The shares
represented hereby will be voted as indicated; if no direction is indicated,
then they will be voted "FOR" the Voting Rights Proposal.
(Bullet) VOTING ON THE PROPOSAL: You can vote on the proposal by marking an
[x] in the appropriate block.
(Bullet) If your shares are held by a broker or bank, then you must return
your voting instructions for your shares to be represented at the meeting.
Brokers and banks vote only as instructed to vote.
(Bullet) Note: If the address shown for you is incorrect, then notify your
broker or bank directly.
INSTRUCTIONS
To vote and tender your Shares, be sure to include and
dispatch in the prepaid Federal Express envelope enclosed with
this package:
(Bullet) Completed and signed BLUE Proxy Card
(Bullet) Completed and signed Letter of Transmittal
(unless you have already tendered your Shares)
(Bullet) Share certificates (unless you have already
tendered your Shares)
(Bullet) Completed and signed Notice of Guaranteed
Delivery (if applicable)
If you need another Letter of Transmittal, note that one is
attached to Kuhlman's Proxy Statement.
To arrange for a free Federal Express pickup of the package
call 1-800-238-5355.
Thank you for your cooperation.
