SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------
SCHEDULE 14D-9
SOLICITATION/RECOMMENDATION STATEMENT
PURSUANT TO SECTION 14(d)(4) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Amendment No. 9)
----------------
AMP INCORPORATED
(Name of Subject Company)
AMP INCORPORATED
(Name of Person(s) Filing Statement)
Common Stock, no par value
(including Associated Common Stock Purchase Rights)
(Title of Class of Securities)
031897-10-1
(CUSIP Number of Class of Securities)
David F. Henschel
Corporate Secretary
AMP Incorporated
P.O. Box 3608
Harrisburg, Pennsylvania 17105-3608
(717) 564-0100
(Name, Address and Telephone Number of Person Authorized to Receive
Notice and Communications on Behalf of the Person(s) Filing Statement)
With a Copy to:
Peter Allan Atkins
David J. Friedman
Skadden, Arps, Slate, Meagher & Flom LLP
919 Third Avenue
New York, New York 10022-3897
(212) 735-3000
This Amendment No. 9 amends and supplements the
Solicitation/Recommendation Statement of Schedule 14D-9 dated August 21,
1998, as amended, (the "Schedule 14D-9") filed by AMP Incorporated, a
Pennsylvania corporation ("AMP"), in connection with the tender offer by
PMA Acquisition Corporation, a Delaware corporation (the "Purchaser") and
wholly owned subsidiary of AlliedSignal Inc., a Delaware corporation
("AlliedSignal"), to purchase all of the issued and outstanding shares of
common stock, no par value, of AMP (the "Common Stock"), including the
associated Common Stock Purchase Rights (the "Rights" and, together with
the Common Stock, the "Shares") issued pursuant to the Rights Agreement,
dated as of October 28, 1989, and as amended on September 4, 1992, August
12, 1998 and August 20, 1998 (the "Rights Agreement"), between AMP and
ChaseMellon Shareholder Services L.L.C., as Rights Agent, at a price of
$44.50 per Share, net to the seller in cash, as disclosed in its Tender
Offer Statement on Schedule 14D-1, dated August 10, 1998, upon the terms
and subject to the conditions set forth in the Offer to Purchase, dated
August 10, 1998, and the related Letter of Transmittal.
Unless otherwise indicated, all defined terms used herein shall have
the same meaning as those set forth in the Schedule 14D-9.
ITEM 8. ADDITIONAL INFORMATION TO BE FURNISHED.
Subsection (f) of Item 8 is hereby amended by adding the following
paragraph at the end thereof:
On September 4, 1998, AlliedSignal and AMP entered into a letter
agreement which requires that prior to AlliedSignal or AMP, as the case may
be, making effective or taking certain actions identified in the letter
agreement, the party desiring to make effective or take such action must
provide the other party with notice in accordance with the terms of the
letter agreement. A copy of the letter agreement is filed as Exhibit 36
hereto and is incorporated herein by reference.
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.
The following exhibits are filed herewith:
Exhibit
No. Description
------- -----------
35 Letter sent by AMP to its shareholders on September
5, 1998.
36 Letter Agreement, dated September 4, 1998, between
AlliedSignal and AMP.
37 Text of a newspaper advertisement published by AMP
on September 8, 1998.
38 Text of a press release issued by AMP, dated
September 8, 1998.
o o o
This document and the exhibits attached hereto may contain certain
"forward-looking" statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Exchange Act,
which are intended to be covered by the safe harbors created thereby. Such
statements should be considered as subject to risks and uncertainties that
exist in AMP's operations and business environment and could render actual
outcomes and results materially different than predicted. For a description
of some of the factors or uncertainties which could cause actual results to
differ, reference is made to the section entitled "Cautionary Statements
for Purposes of the 'Safe Harbor'" in AMP's Annual Report on Form 10-K for
the year ended December 31, 1997, a copy of which is filed as Exhibit 19 to
the Schedule 14D-9.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief,
I certify that the information set forth in this statement is true,
complete and correct.
Dated: September 8, 1998 AMP Incorporated
By: /s/ Robert Ripp
------------------------------
Name: Robert Ripp
Title: Chairman and Chief
Executive Officer
EXHIBIT INDEX
The following exhibits are filed herewith:
Exhibit
No. Description
------- -----------
35 Letter sent by AMP to its shareholders on September
5, 1998.
36 Letter Agreement, dated September 4, 1998, between
AlliedSignal and AMP.
37 Text of a newspaper advertisement published by AMP
on September 8, 1998.
38 Text of a press release issued by AMP, dated
September 8, 1998.
Exhibit 35
[AMP Letterhead]
September 5, 1998
Dear Fellow Shareholder:
AlliedSignal wants to buy AMP, and it stands to reason that they
would want to pay the lowest possible price for your shares. AMP's Board of
Directors has rejected AlliedSignal's offer and recommends that you NOT
tender any of your shares.
AlliedSignal, obviously displeased with your Board's decision, also
wants to more than double the size of your Board -- and "pack" it with 17
new directors who we believe will pursue AlliedSignal's interests. IT IS
CLEAR THAT EVERY ONE OF ALLIEDSIGNAL'S 17 NOMINEES, IF PUT ON AMP'S BOARD,
WOULD HAVE IRRECONCILABLE CONFLICTS OF INTEREST. Here's why:
o Every one of AlliedSignal's 17 nominees is a director or executive
officer of AlliedSignal -- and several of them serve AlliedSignal in both
capacities.
o Not a single one of AlliedSignal's 17 nominees can claim that
he or she would have undivided loyalty to AMP -- and every one of them has
a duty of loyalty to AlliedSignal and AlliedSignal's own shareholders under
Delaware law.
o AlliedSignal is indemnifying each of their 17 nominees "to the
fullest extent permitted by Delaware law" -- EVEN IF THEY BREACH THEIR
FIDUCIARY DUTIES TO AMP.
o AlliedSignal owns only 100 shares of AMP stock and currently cannot
complete its tender offer until November 1999 -- yet AlliedSignal wants to
take control of AMP's Board now.
In sharp contrast, AMP has in place an overwhelmingly independent
Board of Directors. Your Board, acting solely in the best interests of AMP,
has determined that the best opportunity for value is AMP's Profit
Improvement Plan -- not AlliedSignal's opportunistic, inadequate bid. AT
THIS CRITICAL TIME, WITH THE VALUE OF YOUR INVESTMENT IN AMP AT STAKE, YOU
NEED AND DESERVE AN INDEPENDENT BOARD OF DIRECTORS WITH UNDIVIDED LOYALTY.
You will be asked to make some important decisions concerning your
investment in AMP. In making those decisions, we urge you to keep in mind
the following:
o Implementation of AMP's Profit Improvement Plan is now being
accelerated.
o Positive results of the Plan are expected to be reflected in
the fourth quarter of this year.
o The Plan is expected to generate an operating margin of 13.5% in
1999 with an EPS of at least $2.30, and an operating margin of 16.5% in
2000 with an EPS of at least $3.00.
o We are actively pursuing ways to accelerate the benefits of this
Plan and exploring options to INCREASE VALUE FURTHER IN THE NEARER TERM.
THE PROFIT IMPROVEMENT PLAN IS DESIGNED TO BENEFIT YOU. DON'T LET
ALLIEDSIGNAL CAPTURE OUR FUTURE FOR THE BENEFIT OF ITS OWN SHAREHOLDERS!
You can best protect your interests by NOT tendering any of your
shares to AlliedSignal and NOT signing any consent that will be solicited
by AlliedSignal.
We thank you for your continued support.
Sincerely,
/s/ Robert Ripp
Robert Ripp
Chairman and Chief Executive
Officer
IF YOU HAVE ANY QUESTIONS OR REQUIRE ANY ASSISTANCE
IN WITHDRAWING ANY SHARES YOU MAY HAVE TENDERED,
PLEASE CALL:
INNISFREE M&A INCORPORATED
CALL TOLL FREE: (888) 750-5834
PARTICIPANT INFORMATION AND FORWARD-LOOKING STATEMENTS
AMP and certain other persons named below may be deemed to be participants
in the solicitation of revocations of consents in response to
AlliedSignal's consent solicitation. The participants in this solicitation
may include the directors of AMP (Ralph D. DeNunzio, Barbara H. Franklin,
Joseph M. Hixon III, William J. Hudson, Jr., Joseph M. Magliochetti, Harold
A. McInnes, Jerome J. Meyer, John C. Morley, Robert Ripp, Paul G. Schloemer
and Takeo Shiina); the following executive officers of AMP: Robert Ripp
(Chairman and Chief Executive Officer), William J. Hudson (Vice Chairman),
James E. Marley (former Chairman), William S. Urkiel (Corporate Vice
President and Chief Financial Officer), Herbert M. Cole (Senior Vice
President for Operations), Juergen W. Gromer (Senior Vice President, Global
Industry Businesses), Richard P. Clark (Divisional Vice President, Global
Wireless Products Group), Thomas DiClemente (Corporate Vice President and
President, Europe, Middle East, Africa), Rudolf Gassner (Corporate Vice
President and President, Global Personal Computer Division), Charles W.
Goonrey (Corporate Vice President and General Legal Counsel), John E.
Gurski (Corporate Vice President and President, Global Value-Added
Operations and President, Global Operations Division), David F. Henschel
(Corporate Secretary), John H. Kegel (Corporate Vice President,
Asia/Pacific), Mark E. Lang (Corporate Controller), Philippe Lemaitre
(Corporate Vice President and Chief Technology Officer), Joseph C.
Overbaugh (Corporate Treasurer), Nazario Proietto (Corporate Vice President
and President, Global Consumer, Industrial and Power Technology Division);
and the following other members of management and employees of AMP: Richard
Skaare (Director, Corporate Communication), Douglas Wilburne (Director,
Investor Relations), Mary Rakoczy (Manager, Shareholder Services), Dorothy
J. Hiller (Assistant Manager, Shareholder Services) and Melissa E. Witsil
(Communications Assistant). As of the date of this communication, none of
the foregoing participants individually beneficially own in excess of 1% of
AMP's common stock or in the aggregate in excess of 2% of AMP's common
stock.
AMP has retained Credit Suisse First Boston Corporation ("CSFB") and
Donaldson, Lufkin & Jenrette Securities Corporation ("DLJ") to act as its
financial advisors in connection with the AlliedSignal Offer, for which
CSFB and DLJ will receive customary fees, as well as reimbursement of
reasonable out-of-pocket expenses. In addition, AMP has agreed to indemnify
CSFB, DLJ and certain related persons against certain liabilities,
including certain liabilities under the federal securities laws, arising
out of their engagement. CSFB and DLJ are investment banking firms that
provide a full range of financial services for institutional and individual
clients. Neither CSFB nor DLJ admits that it or any of its directors,
officers or employees is a "participant" as defined in Schedule 14A
promulgated under the Securities Exchange Act of 1934, as amended, in the
solicitation, or that Schedule 14A requires the disclosure of certain
information concerning either CSFB or DLJ. In connection with CSFB's role
as financial advisor to AMP, CSFB and the following investment banking
employees of CSFB may communicate in person, by telephone or otherwise with
a limited number of institutions, brokers or other persons who are
stockholders of AMP: Alan Howard, Steven Koch, Scott Lindsay, and Lawrence
Hamdan. In connection with DLJ's role as financial advisor to AMP, DLJ and
the following investment banking employees of DLJ may communicate in
person, by telephone or otherwise with a limited number of institutions,
brokers or other persons who are stockholders of AMP: Douglas V. Brown and
Herald L. Ritch. In the normal course of its business, each of CSFB and DLJ
regularly buys and sells securities issued by AMP for its own account and
for the accounts of its customers, which transactions may result in CSFB,
DLJ or the associates of either of them having a net "long" or net "short"
position in AMP securities, or option contracts or other derivatives in or
relating to such securities. As of September 1, 1998, DLJ held no shares of
AMP common stock for its own account and CSFB had a net long position of
118,566 shares of AMP common stock.
The accompanying letter contains certain "forward-looking" statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, which are intended to be covered by the safe harbors created
thereby. Such statements should be considered as subject to risks and
uncertainties that exist in AMP's operations and business environment and
could render actual outcomes and results materially different than
predicted. For a description of some of the factors or uncertainties which
could cause actual results to differ, reference is made to the section
entitled "Cautionary Statements for Purposes of the 'Safe Harbor ' " in
AMP's Annual Report on Form 10-K for the year ended December 31, 1997. In
addition, the realization of the benefits anticipated from the strategic
initiatives described in the accompanying letter will be dependent, in
part, on management's ability to execute its business plans and to motivate
properly the AMP employees, whose attention has been distracted by the
AlliedSignal offer and whose numbers will have been reduced as a result of
these initiatives.
Exhibit 36
September 4, 1998
BY HAND DELIVERY
Mary A. McLaughlin, Esquire
Dechert, Price & Rhoads
4000 Bell Atlantic Tower
1717 Arch Street
Philadelphia, PA 19103
Re: AlliedSignal Corporation v. AMP Incorporated
AMP Incorporated v. AlliedSignal Corporation and
PMA Acquisition Corporation
Dear Mary:
This letter sets forth the agreement between AlliedSignal
Corporation ("AlliedSignal") and AMP Incorporated ("AMP"), in connection
with the above-entitled actions, as follows:
1. AMP agrees that it will give at least six calendar days'
notice to AlliedSignal prior to making effective any of the following
actions: a) other than in an aggregate amount not exceeding five percent
(5%) of AMP's outstanding voting securities, issuing or selling any AMP
voting securities; b) amending AMP's By-Laws; or c) further amending AMP's
rights agreement, dated as of October 28, 1989, last amended on August 20,
1998.
2. AlliedSignal agrees that it will give at least six calendar
days' notice to AMP prior to making effective any amendments, changes or
additions (including by adding new proposals) to the proposals identified
for action by written consent set forth in its Consent Solicitation
Statement filed on August 12, 1998 with the Securities and Exchange
Commission ("SEC") (the "Consent Solicitation").
3. Nothing herein shall prevent either party from making, and
filing with the SEC, a public announcement at any time of the intended
action for which notice is given in paragraphs 1 or 2 above.
4. The notice requirements in paragraphs 1 and 2 above shall
mean that the party which is required to give notice of an intended action
shall be prohibited from making that action effective until on or after the
Effective Date, which shall be defined as the sixth calendar day which
follows the Notice Date, as defined in paragraph 5 below.
5. For purposes of this agreement, to comply with this
agreement, the required notice must reasonably describe the action planned
to be made effective on or after the Effective Date. The Notice Date is
the date that notice is given if given in the manner described below, so
long as the notice is given and receipt is confirmed prior to 5:00 p.m. EDT
on a business day. If notice is given but not confirmed as received until
after 5:00 p.m EDT on a business day or is given on a non-business day,
then the Notice Date is the next business day thereafter. Notice shall be
given by a) sending (with confirmation of receipt) the notice by facsimile
to the facsimile number of the Representative of the recipient party
identified below, or b) hand delivering the notice to the office of the
Representative of the recipient party designated below. For purposes of
this agreement, a "business day" is any day other than Saturday, Sunday or
a legal holiday, as defined in Fed. R. Civ. P. Rule 6(a). The
Representatives of the parties for purposes of receiving notice pursuant to
this agreement are: For AlliedSignal: Arthur Fleischer, Jr. of Fried,
Frank, Harris, Shriver & Jacobson, One New York Plaza, New York, New York
10004-1980 (fax: 212-859-4000); and for AMP: Peter Allan Atkins of
Skadden, Arps, Slate, Meagher & Flom, LLP, 919 Third Avenue, New York, New
York 10022 (fax: 212-735-3691).
6. This agreement shall terminate on October 9, 1998. If prior
to October 9, 1998, the Consent Solicitation and the Offer are terminated,
this agreement shall then terminate.
7. The parties agree that either party shall be entitled to
move for a restraining order or injunction to remedy any material breach of
this agreement in either of the above-entitled actions.
8. AlliedSignal agrees not to contest the Consent Solicitation
record date of October 15, 1998.
9. By entering into this agreement, AlliedSignal does not
acknowledge that the record date of October 15, 1998 is a proper Consent
Solicitation record date or represents a reasonable exercise of the
authority of the AMP board of directors in establishing a record date; and
AlliedSignal expressly waives no rights to contest any change, postponement
or other action with respect to the Consent Solicitation record date. By
entering into this agreement, AMP does not acknowledge the validity of
AlliedSignal's position; and AMP waives no rights, claims or defenses it
may have with respect to matters relating to the Offer or the Consent
Solicitation.
If this letter correctly sets forth our agreement, please sign
and date the duplicate copy of this letter and return it to me. We agree
that either copy of this letter, so long as signed on behalf of the party
against whom enforcement may be sought, shall be deemed an original hereof
for all purposes, and each of the parties intends to be legally bound
hereby. We further agree that this agreement shall be interpreted in all
respects in accordance with the internal law of the Commonwealth of
Pennsylvania, without regard to choice of law principles applied in the
Commonwealth of Pennsylvania. No amendment of this agreement shall be
effective unless made in writing, executed on behalf of both parties.
Sincerely,
/s/ John G. Harkins, Jr.
John G. Harkins, Jr.
On behalf of AMP Incorporated
AGREED TO AND ACCEPTED:
/s/ Mary A. McLaughlin
Mary A. McLaughlin
On behalf of
AlliedSignal Corporation
Date of acceptance: September 4, 1998.
Exhibit 37
TO ALL AMP SHAREHOLDERS:
AT THIS CRITICAL TIME, YOU NEED AND DESERVE
AN INDEPENDENT BOARD WITH UNDIVIDED LOYALTY
AlliedSignal wants to buy AMP, and it stands to reason that they would want
to pay the lowest possible price for your shares. AMP's Board of Directors
has rejected AlliedSignal's inadequate offer and recommends that you not
tender any of your shares.
Allied Signal also wants to more than double the size of your Board-and
"pack" it with 17 new directors who we believe will pursue AlliedSignal's
interests. IT IS CLEAR THAT EVERY ONE OF ALLIEDSIGNAL'S 17 NOMINEES, IF PUT
ON AMP'S BOARD, WOULD HAVE IRRECONCILABLE CONFLICTS OF INTEREST. Here's
why:
o Every one of AlliedSignal's 17 nominees is a director or executive
officer of AlliedSignal-and several of them serve AlliedSignal in
both capacities.
o Not a single one of AlliedSignal's 17 nominees can claim that he or
she would have undivided loyalty to AMP-and every one of them has a
duty of loyalty to AlliedSignal and AlliedSignal's own shareholders
under Delaware law.
o AlliedSignal is indemnifying each of their 17 nominees "to the
fullest extent permitted by Delaware law"-EVEN IF THEY BREACH THEIR
FIDUCIARY DUTIES TO AMP.
o AlliedSignal owns only 100 shares of AMP stock and currently cannot
complete its tender offer until November 1999-yet AlliedSignal wants
to take control of AMP's Board now.
In sharp contrast, AMP has in place an overwhelmingly independent Board of
Directors. You Board, acting solely in the best interests of AMP,
has determined:
THE BEST OPPORTUNITY FOR VALUE IS AMP'S PROFIT IMPROVEMENT PLAN--
NOT ALLIEDSIGNAL'S OPPORTUNISTIC, INADEQUATE BID
o Implementation of the Profit Improvement Plan is now being
accelerated.
o Positive results of the Plan are expected to be reflected in
the fourth quarter
of this year.
o The Plan is expected to generate an operating margin of 13.5% in 1999
with an EPS of at least $2.30, and an operating margin of 16.5% in
2000 with an EPS of at least $3.00.
o We are actively pursuing ways to accelerate the benefits of this Plan
and exploring options to INCREASE VALUE FURTHER IN THE NEARER TERM.
THE PROFIT IMPROVEMENT PLAN IS DESIGNED TO BENEFIT YOU.
DON'T LET ALLIEDSIGNAL CAPTURE OUR FUTURE FOR THE BENEFIT OF ITS OWN
SHAREHOLDERS!
PROTECT YOUR INTERESTS. DON'T TENDER. DON'T CONSENT.
September 8, 1998
IMPORTANT
IF YOU HAVE ANY QUESTIONS OR REQUIRE ANY ASSISTANCE IN WITHDRAWING
ANY SHARES YOU MAY HAVE TENDERED, PLEASE CALL:
INNISFREE M&A INCORPORATED
CALL TOLL FREE: (888) 750-5834
BANKS AND BROKERS CALL COLLECT: (212) 750-5833
[AMP LOGO]
AMP and certain other persons named below may be deemed to be participants
in the solicitation of revocations of consents in response to
AlliedSignal's consent solicitation. The participants in this solicitation
may include the directors of AMP (Ralph D. DeNunzio, Barbara H. Franklin,
Joseph M. Hixon III, William J. Hudson, Jr., Joseph M. Magliochetti, Harold
A. McInnes, Jerome J. Meyer, John C. Morley, Robert Ripp, Paul G. Schloemer
and Takeo Shiina); the following executive officers of AMP: Robert Ripp
(Chairman and Chief Executive Officer), William J. Hudson (Vice Chairman),
James E. Marley (former Chairman), William S. Urkiel (Corporate Vice
President and Chief Financial Officer), Herbert M. Cole (Senior Vice
President for Operations), Juergen W. Gromer (Senior Vice President, Global
Industry Businesses), Richard P. Clark (Divisional Vice President, Global
Wireless Products Group), Thomas DiClemente (Corporate Vice President and
President, Europe, Middle East, Africa), Rudolf Gassner (Corporate Vice
President and President, Global Personal Computer Division), Charles W.
Goonrey (Corporate Vice President and General Legal Counsel), John E.
Gurski (Corporate Vice President and President, Global Value-Added
Operations and President, Global Operations Division), David F. Henschel
(Corporate Secretary), John H. Kegel (Corporate Vice President,
Asia/Pacific), Mark E. Lang (Corporate Controller), Philippe Lemaitre
(Corporate Vice President and Chief Technology Officer), Joseph C.
Overbaugh (Corporate Treasurer), Nazario Proietto (Corporate Vice President
and President, Global Consumer, Industrial and Power Technology Division);
and the following other members of management and employees of AMP: Richard
Skaare (Director, Corporate Communication), Douglas Wilburne (Director,
Investor Relations), Mary Rakoczy (Manager, Shareholder Services), Dorothy
J. Hiller (Assistant Manager, Shareholder Services) and Melissa E. Witsil
(Communications Assistant). As of the date of this communication, none of
the foregoing participants individually beneficially own in excess of 1% of
AMP's common stock or in the aggregate in excess of 2% of AMP's common
stock.
AMP has retained Credit Suisse First Boston Corporation ("CSFB") and
Donaldson, Lufkin & Jenrette Securities Corporation ("DLJ") to act as its
financial advisors in connection with the AlliedSignal Offer, for which
CSFB and DLJ will receive customary fees, as well as reimbursement of
reasonable out-of-pocket expenses. In addition, AMP has agreed to indemnify
CSFB, DLJ and certain related persons against certain liabilities,
including certain liabilities under the federal securities laws, arising
out of their engagement. CSFB and DLJ are investment banking firms that
provide a full range of financial services for institutional and individual
clients. Neither CSFB nor DLJ admits that it or any of its directors,
officers or employees is a "participant" as defined in Schedule 14A
promulgated under the Securities Exchange Act of 1934, as amended, in the
solicitation, or that Schedule 14A requires the disclosure of certain
information concerning either CSFB or DLJ. In connection with CSFB's role
as financial advisor to AMP, CSFB and the following investment banking
employees of CSFB may communicate in person, by telephone or otherwise with
a limited number of institutions, brokers or other persons who are
stockholders of AMP: Alan Howard, Steven Koch, Scott Lindsay, and Lawrence
Hamdan. In connection with DLJ's role as financial advisor to AMP, DLJ and
the following investment banking employees of DLJ may communicate in
person, by telephone or otherwise with a limited number of institutions,
brokers or other persons who are stockholders of AMP: Douglas V. Brown and
Herald L. Ritch. In the normal course of its business, each of CSFB and DLJ
regularly buys and sells securities issued by AMP for its own account and
for the accounts of its customers, which transactions may result in CSFB,
DLJ or the associates of either of them having a net "long" or net "short"
position in AMP securities, or option contracts or other derivatives in or
relating to such securities. As of September 1, 1998, DLJ held no shares of
AMP common stock for its own account and CSFB had a net long position of
118,566 shares of AMP common stock.
The accompanying letter contains certain "forward-looking" statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, which are intended to be covered by the safe harbors created
thereby. Such statements should be considered as subject to risks and
uncertainties that exist in AMP's operations and business environment and
could render actual outcomes and results materially different than
predicted. For a description of some of the factors or uncertainties which
could cause actual results to differ, reference is made to the section
entitled "Cautionary Statements for Purposes of the 'Safe Harbor ' " in
AMP's Annual Report on Form 10-K for the year ended December 31, 1997. In
addition, the realization of the benefits anticipated from the strategic
initiatives described in the accompanying letter will be dependent, in
part, on management's ability to execute its business plans and to motivate
properly the AMP employees, whose attention has been distracted by the
AlliedSignal offer and whose numbers will have been reduced as a result of
these initiatives.
Exhibit 38
FOR IMMEDIATE RELEASE
Contacts:
Richard Skaare Dan Katcher / Joele Frank
AMP Corporate Communication Abernathy MacGregor Frank
717/592-2323 212/371-5999
Doug Wilburne
AMP Investor Relations
717/592-4965
AMP CITES IRRECONCILABLE CONFLICTS OF INTEREST
OF ALLIEDSIGNAL NOMINEES
HARRISBURG, PENNSYLVANIA (SEPTEMBER 8, 1998) - AMP Incorporated (NYSE: AMP)
sent the following letter to AMP shareholders:
September 5, 1998
Dear Fellow Shareholder:
AlliedSignal wants to buy AMP, and it stands to reason that they
would want to pay the lowest possible price for your shares. AMP's Board of
Directors has rejected AlliedSignal's offer and recommends that you NOT
tender any of your shares.
AlliedSignal, obviously displeased with your Board's decision, also
wants to more than double the size of your Board -- and "pack" it with 17
new directors who we believe will pursue AlliedSignal's interests. IT IS
CLEAR THAT EVERY ONE OF ALLIEDSIGNAL'S 17 NOMINEES, IF PUT ON AMP'S BOARD,
WOULD HAVE IRRECONCILABLE CONFLICTS OF INTEREST.
Here's why:
o Every one of AlliedSignal's 17 nominees is a director or executive
officer of AlliedSignal -- and several of them serve AlliedSignal
in both
capacities.
o Not a single one of AlliedSignal's 17 nominees can claim that he
or she would have undivided loyalty to AMP -- and every one of
them has a duty of loyalty to AlliedSignal and AlliedSignal's own
shareholders under Delaware law.
o AlliedSignal is indemnifying each of their 17 nominees "to the
fullest extent permitted by Delaware law" -- EVEN IF THEY BREACH
THEIR FIDUCIARY DUTIES TO AMP.
o AlliedSignal owns only 100 shares of AMP stock and currently
cannot complete its tender offer until November 1999 -- yet
AlliedSignal wants to take control of AMP's Board now.
In sharp contrast, AMP has in place an overwhelmingly independent
Board of Directors. Your Board, acting solely in the best interests of AMP,
has determined that the best opportunity for value is AMP's Profit
Improvement Plan -- not AlliedSignal's opportunistic, inadequate bid. AT
THIS CRITICAL TIME, WITH THE VALUE OF YOUR INVESTMENT IN AMP AT STAKE, YOU
NEED AND DESERVE AN INDEPENDENT BOARD OF DIRECTORS WITH UNDIVIDED LOYALTY.
You will be asked to make some important decisions concerning your
investment in AMP. In making those decisions, we urge you to keep in mind
the following:
o Implementation of AMP's Profit Improvement Plan is now being
accelerated.
o Positive results of the Plan are expected to be reflected
in the fourth
quarter of this year.
o The Plan is expected to generate an operating margin of 13.5% in
1999 with an EPS of at least $2.30, and an operating margin of
16.5% in 2000 with an EPS of at least $3.00.
o We are actively pursuing ways to accelerate the benefits of this
Plan and exploring options to INCREASE VALUE FURTHER IN THE NEARER
TERM.
THE PROFIT IMPROVEMENT PLAN IS DESIGNED TO BENEFIT YOU. DON'T LET
ALLIEDSIGNAL CAPTURE OUR FUTURE FOR THE BENEFIT OF ITS OWN SHAREHOLDERS!
You can best protect your interests by NOT tendering any of your
shares to AlliedSignal and NOT signing any consent that will be solicited
by AlliedSignal.
We thank you for your continued support.
Sincerely,
/s/ Robert Ripp
Robert Ripp
Chairman and Chief Executive Officer
PARTICIPANT INFORMATION AND FORWARD-LOOKING STATEMENTS
AMP and certain other persons named below may be deemed to be participants
in the solicitation of revocations of consents in response to
AlliedSignal's consent solicitation. The participants in this solicitation
may include the directors of AMP (Ralph D. DeNunzio, Barbara H. Franklin,
Joseph M. Hixon III, William J. Hudson, Jr., Joseph M. Magliochetti, Harold
A. McInnes, Jerome J. Meyer, John C. Morley, Robert Ripp, Paul G. Schloemer
and Takeo Shiina); the following executive officers of AMP: Robert Ripp
(Chairman and Chief Executive Officer), William J. Hudson (Vice Chairman),
James E. Marley (former Chairman), William S. Urkiel (Corporate Vice
President and Chief Financial Officer), Herbert M. Cole (Senior Vice
President for Operations), Juergen W. Gromer (Senior Vice President, Global
Industry Businesses), Richard P. Clark (Divisional Vice President, Global
Wireless Products Group), Thomas DiClemente (Corporate Vice President and
President, Europe, Middle East, Africa), Rudolf Gassner (Corporate Vice
President and President, Global Personal Computer Division), Charles W.
Goonrey (Corporate Vice President and General Legal Counsel), John E.
Gurski (Corporate Vice President and President, Global Value-Added
Operations and President, Global Operations Division), David F. Henschel
(Corporate Secretary), John H. Kegel (Corporate Vice President,
Asia/Pacific), Mark E. Lang (Corporate Controller), Philippe Lemaitre
(Corporate Vice President and Chief Technology Officer), Joseph C.
Overbaugh (Corporate Treasurer), Nazario Proietto (Corporate Vice President
and President, Global Consumer, Industrial and Power Technology Division);
and the following other members of management and employees of AMP: Richard
Skaare (Director, Corporate Communication), Douglas Wilburne (Director,
Investor Relations), Mary Rakoczy (Manager, Shareholder Services), Dorothy
J. Hiller (Assistant Manager, Shareholder Services) and Melissa E. Witsil
(Communications Assistant). As of the date of this communication, none of
the foregoing participants individually beneficially own in excess of 1% of
AMP's common stock or in the aggregate in excess of 2% of AMP's common
stock.
AMP has retained Credit Suisse First Boston Corporation ("CSFB") and
Donaldson, Lufkin & Jenrette Securities Corporation ("DLJ") to act as its
financial advisors in connection with the AlliedSignal Offer, for which
CSFB and DLJ will receive customary fees, as well as reimbursement of
reasonable out-of-pocket expenses. In addition, AMP has agreed to indemnify
CSFB, DLJ and certain related persons against certain liabilities,
including certain liabilities under the federal securities laws, arising
out of their engagement. CSFB and DLJ are investment banking firms that
provide a full range of financial services for institutional and individual
clients. Neither CSFB nor DLJ admits that it or any of its directors,
officers or employees is a "participant" as defined in Schedule 14A
promulgated under the Securities Exchange Act of 1934, as amended, in the
solicitation, or that Schedule 14A requires the disclosure of certain
information concerning either CSFB or DLJ. In connection with CSFB's role
as financial advisor to AMP, CSFB and the following investment banking
employees of CSFB may communicate in person, by telephone or otherwise with
a limited number of institutions, brokers or other persons who are
stockholders of AMP: Alan Howard, Steven Koch, Scott Lindsay, and Lawrence
Hamdan. In connection with DLJ's role as financial advisor to AMP, DLJ and
the following investment banking employees of DLJ may communicate in
person, by telephone or otherwise with a limited number of institutions,
brokers or other persons who are stockholders of AMP: Douglas V. Brown and
Herald L. Ritch. In the normal course of its business, each of CSFB and DLJ
regularly buys and sells securities issued by AMP for its own account and
for the accounts of its customers, which transactions may result in CSFB,
DLJ or the associates of either of them having a net "long" or net "short"
position in AMP securities, or option contracts or other derivatives in or
relating to such securities. As of September 1, 1998, DLJ held no shares of
AMP common stock for its own account and CSFB had a net long position of
118,566 shares of AMP common stock.
This release contains certain "forward-looking" statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended, which are
intended to be covered by the safe harbors created thereby. Such statements
should be considered as subject to risks and uncertainties that exist in
AMP's operations and business environment and could render actual outcomes
and results materially different than predicted. For a description of some
of the factors or uncertainties which could cause actual results to differ,
reference is made to the section entitled "Cautionary Statements for
Purposes of the 'Safe Harbor ' " in AMP's Annual Report on Form 10-K for
the year ended December 31, 1997. In addition, the realization of the
benefits anticipated from the strategic initiatives described in the
accompanying letter will be dependent, in part, on management's ability to
execute its business plans and to motivate properly the AMP employees,
whose attention has been distracted by the AlliedSignal offer and whose
numbers will have been reduced as a result of these initiatives.
