BCP/ESSEX HOLDINGS INC, S-1, 1997-02-19

BCP/ESSEX HOLDINGS INC
S-1, 1997-02-19
DRAWING & INSULATING OF NONFERROUS WIRE

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<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY , 1997

REGISTRATION NO. 333-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------

FORM S-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

--------------------------

BCP/ESSEX HOLDINGS INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

<TABLE>
<S> <C> <C>
DELAWARE 3357 13-3496934
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) CLASSIFICATION NUMBER) IDENTIFICATION NUMBER)
</TABLE>

1601 WALL STREET
FORT WAYNE, IN 46802
(219) 461-4000

(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE
OFFICES)
--------------------------

MR. STEVEN R. ABBOTT
PRESIDENT AND CHIEF EXECUTIVE OFFICER
BCP/ESSEX HOLDINGS INC.
1601 WALL STREET
FORT WAYNE, IN 46802
(219) 461-4000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
--------------------------

COPIES TO:

<TABLE>
<S> <C>
KRIS F. HEINZELMAN, ESQ. ROBERT W. REEDER, III, ESQ.
CRAVATH, SWAINE & MOORE SULLIVAN & CROMWELL
825 EIGHTH AVENUE 125 BROAD STREET
NEW YORK, NEW YORK 10019 NEW YORK, NEW YORK 10004
</TABLE>

--------------------------

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the effective date of this Registration Statement. If any of
the securities being registered on this Form are to be offered on a delayed or
continuous basis pursuant to Rule 415 under the Securities Act of 1933, check
the following box. / /

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /

If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, please check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. / /

If the delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. / /
--------------------------

CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>
PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AGGREGATE OFFERING AMOUNT OF
SECURITIES TO BE REGISTERED PRICE(a) REGISTRATION FEE
<S> <C> <C>
Common Stock, $.01 par value...................................................... $150,000,000 $45,455
</TABLE>

(a) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(a) promulgated under the Securities Act of 1933. A
portion of the proposed maximum aggregate offering price represents shares
that are to be offered outside of the United States but that may be resold
from time to time in the United States. Such shares are not being registered
for the purpose of sales outside the United States.

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933, OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.

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- --------------------------------------------------------------------------------
<PAGE>
EXPLANATORY NOTE

Prior to the effectiveness of this Registration Statement, BCP/Essex
Holdings Inc. will amend its corporate charter to change its name to Essex
International Inc. For the purposes of the Prospectus included herein, the
Registrant has used its name as amended.
<PAGE>
SUBJECT TO COMPLETION, DATED , 1997
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
<PAGE>
SHARES

ESSEX INTERNATIONAL INC.

COMMON STOCK
(PAR VALUE $.01 PER SHARE)

------------------

Of the shares of Common Stock offered, shares are being offered
hereby in the United States and shares are being offered in a concurrent
international offering outside the United States. The initial public offering
price and the aggregate underwriting discount per share will be identical for
both offerings. See "Underwriting".

Of the shares of Common Stock offered, shares are being sold by the
Company and shares are being sold by the Selling Stockholders. See
"Principal and Selling Stockholders". The Company will not receive any of the
proceeds from the sale of the shares being sold by the Selling Stockholders.

Prior to this offering, there has been no public market for the Common Stock
of the Company. It is currently estimated that the initial public offering price
per share will be between $ and $ . For factors to be considered in
determining the initial public offering price, see "Underwriting".

SEE "RISK FACTORS" BEGINNING ON PAGE 10 FOR CERTAIN CONSIDERATIONS RELEVANT
TO AN INVESTMENT IN THE COMMON STOCK.

The Company intends to make an application to list the Common Stock on the
New York Stock Exchange under the symbol " ".

--------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.

--------------------

<TABLE>
<CAPTION>
INITIAL PUBLIC UNDERWRITING PROCEEDS TO PROCEEDS TO SELLING
OFFERING PRICE DISCOUNT(1) COMPANY(2) STOCKHOLDERS
---------------- ---------------- ---------------- --------------------
<S> <C> <C> <C> <C>
Per Share.................... $ $ $ $
Total(3)..................... $ $ $ $
</TABLE>

- --------------------------
(1) The Company and the Selling Stockholders have agreed to indemnify the
Underwriters against certain liabilities, including liabilities under the
Securities Act of 1933. See "Underwriting".

(2) Before deducting estimated expenses of $ payable by the Company.

(3) The Selling Stockholders have granted the U.S. Underwriters an option for 30
days to purchase up to an additional shares at the initial public
offering price per share, less the underwriting discount, solely to cover
over-allotments. Additionally, the Selling Stockholders have granted the
International Underwriters a similar option with respect to an additional
shares as part of a concurrent International Offering. If such options
are exercised in full, the total initial public offering price, underwriting
discount and proceeds to the Selling Stockholders will be $ , $ and
$ , respectively. See "Underwriting".

--------------------

The shares offered hereby are offered severally by the U.S. Underwriters, as
specified herein, subject to receipt and acceptance by them and subject to their
right to reject any order in whole or in part. It is expected that certificates
for the shares will be ready for delivery in New York, New York, on or about
, 1997, against payment therefor in immediately available funds.

GOLDMAN, SACHS & CO. SMITH BARNEY INC.

DONALDSON, LUFKIN & JENRETTE LEHMAN BROTHERS
SECURITIES CORPORATION

------------------

The date of this Prospectus is , 1997.

<PAGE>
[INSERT PICTURES]

The Company intends to furnish to its stockholders annual reports containing
audited financial statements for each fiscal year of the Company.

------------------------

CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE COMMON STOCK
OFFERED HEREBY, INCLUDING TRANSACTIONS ON THE NEW YORK STOCK EXCHANGE,
OVER-THE-COUNTER MARKET OR OTHERWISE. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE
"UNDERWRITING".

2
<PAGE>
PROSPECTUS SUMMARY

THE FOLLOWING SUMMARY IS QUALIFIED IN ITS ENTIRETY BY, AND SHOULD BE READ IN
CONJUNCTION WITH, THE MORE DETAILED INFORMATION AND FINANCIAL STATEMENTS
INCLUDED ELSEWHERE IN THIS PROSPECTUS. UNLESS OTHERWISE INDICATED, THE
INFORMATION IN THIS PROSPECTUS (I) ASSUMES THAT THE OVER-ALLOTMENT OPTIONS
GRANTED TO THE U.S. UNDERWRITERS AND THE INTERNATIONAL UNDERWRITERS WILL NOT BE
EXERCISED, (II) GIVES EFFECT TO A ONE-FOR-TWO REVERSE STOCK SPLIT (THE "STOCK
SPLIT") AND A RECLASSIFICATION OF THE COMPANY'S TWO EXISTING CLASSES OF COMMON
STOCK INTO A SINGLE CLASS OF COMMON STOCK (THE "RECLASSIFICATION"), EACH TO BE
EFFECTED PRIOR TO, OR SIMULTANEOUSLY WITH, THE CONSUMMATION OF THE OFFERINGS AND
(III) TREATS THE SHARES OF COMMON STOCK UNDERLYING THE WARRANTS (AS DEFINED
HEREIN) AS IF THEY WERE OUTSTANDING. UNLESS THE CONTEXT OTHERWISE INDICATES, THE
TERM "COMPANY" REFERS TO ESSEX INTERNATIONAL INC. ("ESSEX INTERNATIONAL")
(FORMERLY KNOWN AS BCP/ESSEX HOLDINGS INC.), AND ITS CONSOLIDATED SUBSIDIARIES,
INCLUDING ITS WHOLLY OWNED SUBSIDIARY, ESSEX GROUP, INC. ("ESSEX"), AND THEIR
RESPECTIVE PREDECESSORS.

THE COMPANY

The Company is a leading North American developer, manufacturer and
distributor of copper electrical wire and cable products. Founded in 1930, the
Company serves over 11,000 worldwide customers in a wide range of industrial
markets from its 28 manufacturing facilities and 48 service centers located
throughout the United States and Canada. Since 1993, the Company has
significantly strengthened its market positions through expanded sales efforts
and acquisitions, and has improved its manufacturing capacity and production
efficiencies through capital expenditure and productivity improvement programs.
As a result of these efforts, from 1993 to 1996, the Company's net sales volumes
grew at a compound annual growth rate ("CAGR") of approximately 8%, generating
$1.3 billion net sales in 1996, while its earnings before interest, taxes,
depreciation and amortization ("EBITDA") grew at a CAGR of 22%, from $77 million
in 1993 to $140 million in 1996.

The Company organizes its operating activities into the following principal
areas:

MAGNET WIRE PRODUCTS (29% of 1996 net sales)--The Company's magnet wire
products are used in a wide variety of motors, coils, relays, generators,
solenoids and transformers by the electrical equipment and electronics
industries. Annual industry data since 1991 has shown that the Company's magnet
wire products have had the highest quality in the industry (as measured by
customer returns). As a result of significantly increasing its sales volumes of
magnet wire products in recent years while focusing on higher value-added
products and controlling costs, the gross margins of the Company's magnet wire
business have increased substantially.

BUILDING WIRE AND CABLE PRODUCTS (37% of 1996 net sales)--The Company
produces a wide range of copper building wire products for the commercial,
industrial and residential markets. These products are marketed primarily to
electrical distributors throughout the United States and Canada for ultimate use
by electrical contractors and "do-it-yourself" consumers. Approximately
two-thirds of the Company's net sales of these products is attributable to
remodeling and repair activity and the balance to new nonresidential and
residential construction.

COMMUNICATIONS WIRE AND CABLE PRODUCTS (13% of 1996 net sales)--The
Company's communications wire products consist of outside plant ("OSP") voice
communication copper wire and cable products for the "local loop" segment of the
telecommunication system and voice and data communication copper wire and cable
products for the premise segment of the telecommunication system. Copper-based
wire is the most widely used medium for voice and data transmission in the local
loop and in homes and offices, due in part to its significant installed base,
lower installation cost and ease of repair.

3
<PAGE>
Company produces automotive wire and cable products (7% of 1996 net sales) for
sale to suppliers of automotive original equipment. Such products include
primary wire for use in engine harnesses, ignition wire and battery cable.
Industrial wire and cable products (5% of 1996 net sales) consist of appliance
wire, motor lead wire, submersible pump cable, power cable, flexible cord, power
supply cords, welding cable and recreational vehicle wire. The Company's
distribution business provides a sales channel to both small manufacturers of
original equipment motors and motor repair markets for some of the Company's
magnet wire products, as well as third-party-manufactured products that
complement the Company's magnet wire products. During 1996, third-party products
constituted 9% of net sales, while 20% of the Company's magnet wire products
were sold through this sales channel.

STRATEGY

The Company has established a strategy that is designed to capitalize on its
competitive strengths and position it to pursue opportunities for future growth.
The tenets of this strategy are:

- CAPITALIZE ON SIZE AND SCOPE OF OPERATIONS--The Company is one of the
largest electrical wire and cable producers in the United States. The Company
believes that the size and scope of its operations provide it with efficiencies
in manufacturing, purchasing and distribution and with the resources necessary
to meet the increasing technological demands of the market. The Company intends
to enhance these competitive advantages by continuing to expand its operations
through internal growth and acquisitions. The electrical copper wire and cable
industry in North America has undergone significant consolidation in the past
ten years as a result of increased demand for product quality and lower cost
products that in turn has necessitated substantial capital spending and
development of sophisticated technical capabilities by market participants.

- ENHANCE STRONG MARKET POSITIONS--The Company is focusing on improving its
leading or significant market positions in North America for its major product
categories and capitalizing on the advantages of its size. The Company is one of
two leading producers in each of the magnet wire and building wire markets.
Recent acquisitions in magnet wire distribution, building wire and industrial
wire have enhanced the Company's market positions in these businesses. The
Company intends to maintain and enhance its market positions through internal
growth and continued participation in future industry consolidation.

- MAINTAIN LEADERSHIP IN QUALITY AND PRODUCTIVITY--The Company employs
advanced technologies in manufacturing processes and product development and
intends to continue investing in manufacturing equipment and facilities and to
expand its continuous improvement programs in order to maintain its leadership
in quality and productivity. The Company believes that its wire and cable
products, which have earned numerous customer quality awards, are among the
highest in quality in the industry. Since 1992, the Company has invested
approximately $140 million in capital programs and has expanded its continuous
improvement programs in order to improve the quality of its products and
increase the cost efficiency and capacity of its production facilities. The
Company also has lowered cost levels by pursuing a high level of vertical
integration through internal production of its principal raw materials. In 1996,
the Company produced over 85% of its copper rod, magnet wire enamel and rubber
insulation materials and 70% of its PVC insulation requirements. As a result,
the Company believes that it is among the lowest cost domestic producers in each
of its business lines. A key productivity measure, annual copper equivalent
pounds shipped per employee, has increased by 21% from 1991 to 1996.

- CAPITALIZE ON INDUSTRY GROWTH OPPORTUNITIES--The Company believes that, as
consumers continue to adapt to technological advances in both the home and the
workplace, the technical specifications of the "smart" home and office will
generate increased demand for certain electrical wire and cable products. The
Company believes that it is well positioned to capitalize on this growth due to
its significant market positions, strong name recognition and size. Growth in
the magnet wire business is expected to be driven by increasing demand for
devices containing electric motors in the home and in automobiles,

4
<PAGE>
along with continuing consumer and government pressure for higher energy
efficiency from these devices (energy efficient motors utilize materially more
magnet wire per unit than do their traditional counterparts). Growth in the
building wire business is expected to come primarily from increasing repair and
remodeling activity, as well as from new commercial, industrial and residential
construction. Both new construction and remodeling activity is being affected by
the increased number of circuits and amperage handling capacity needed to
support the increasing demand for electrical services. The Company believes that
its communications wire and cable business will benefit from the increasing
number of outside telephone lines into and inside homes and offices and the
increasing quality demands placed on these lines to facilitate escalating data
transmission from the growing number of computers, facsimile machines and
Internet devices. In the automotive business, the Company believes that the
increasing production of cars and trucks with motorized or electrical options
will translate into increased demand for higher quality, thinner-gauge wire
products to take advantage of their lighter weights and greater efficiency.

- PURSUE ACQUISITION OPPORTUNITIES--Consistent with its historical emphasis
on vertical integration, breadth of product line and technological innovation,
the Company continuously evaluates opportunities to benefit further from its
manufacturing, purchasing and distribution capabilities, expand its customer
base, reduce costs and enter new markets through acquisitions, investments,
joint ventures and other strategic alliances. Since a major recapitalization in
1995 (the "1995 Refinancing"), which provided the Company with substantial
financial and operating flexibility, the Company has acquired three major
businesses: the distribution business of Avnet Inc. in October 1995
("Brownell"); the Canadian building wire business of BICC Phillips, Inc. in
March 1996 ("BICC Canada"); and the building and industrial wire businesses of
Triangle Wire & Cable, Inc. ("Triangle") in October 1996. The Company believes
that each of these businesses provides operating synergy that complements the
Company's existing manufacturing, distribution and administrative capabilities,
and each has met or exceeded financial and operating expectations since its
respective acquisition date. In addition, in May 1995, the Company entered into
a joint venture in India with Finolex Cable LTD for the development and
production of copper rod and other wire products for the domestic Indian market
and recently established a joint venture with Raychem Corp. for the production
and sale of high performance wire products for the automotive industry. The
Company is currently evaluating several acquisition opportunities consistent
with its business strategy, although it has not reached agreement with any third
parties at this time.

- EXPAND INTERNATIONAL BUSINESS--Historically, the Company's production and
distribution emphasis has focused on North America, primarily the U.S. market.
Management anticipates that while the Company will remain focused on the U.S.
market, it expects to increase its efforts in expanding its customer base in
Canada and Mexico, where the Company believes demand for electrical wire and
cable products will grow significantly over the next few years. Management also
expects to establish a preliminary presence in certain developing economies,
particularly in locations that have been targeted by the Company's customers for
their own expansion.

MANAGEMENT AND COMPANY HISTORY

The Company's senior management team, including its business unit managers,
possesses a high level of experience in the wire and cable industry. The eight
most senior officers average 21 years of related industry experience, with an
average of over 17 years with the Company. The equity interest of management and
present and former employees in the Company (15.7% on a fully diluted basis ([
]% after giving effect to the Offerings)) helps ensure that the interests of
management are aligned with those of the Company's other stockholders.

The Company was acquired (the "Acquisition") in a merger in October 1992 by
the existing stockholders. The existing stockholders of the Company and their
equity interests on a fully diluted basis are Bessemer Holdings, L.P. ("BHLP")
and certain affiliated investment partnerships (BHLP and its affiliated
investment partnerships are collectively referred to herein as the "BH Group")
(58.9%), certain

5
<PAGE>
present and former employees (15.7%), certain affiliated investment limited
partnerships of The Goldman Sachs Group, L.P. (collectively, the "GS
Partnerships") (12.4%), affiliates of Donaldson, Lufkin & Jenrette Securities
Corporation ("DLJSC" and together with its affiliates, "DLJ") (9.2%) and Chase
Equity Associates ("CEA") (3.7%). After giving effect to the Offerings, BH
Group, present and former employees, the GS Partnerships, DLJ and CEA will
beneficially own [ ]%, [ ]%, [ ]%, [ ]% and [ ]%, respectively, of the
outstanding shares of Common Stock. In connection with the Acquisition, the GS
Partnerships and DLJ were granted warrants (the "Warrants") to purchase up to
1,120,551.5 and 1,712,817.5 shares of Common Stock, respectively, at an exercise
price of $5.71514 per share. It is anticipated that none of the Warrants will be
outstanding after the Offerings.

The Company's principal executive offices are located at 1601 Wall Street,
Fort Wayne, Indiana 46802, telephone (219) 461-4000.

6
<PAGE>
THE OFFERINGS (a)

<TABLE>
<S> <C>
Shares of Common Stock offered by the
Company.................................... shares

U.S. Offering.............................. shares

International Offering..................... shares

Shares of Common Stock offered by the Selling
Stockholders............................... shares

U.S. Offering.............................. shares

International Offering..................... shares

Total Common Stock to be outstanding after
the Offerings(b)........................... shares

Use of Proceeds.............................. The proceeds of the Offerings payable to the
Company will be used to repay approximately
$68.5 million principal amount of outstanding
indebtedness under the Essex Term Loan and
Essex Revolving Credit Agreement (each as
defined herein). The Company will not receive
any proceeds from the sale of Common Stock by
the Selling Stockholders. See "Use of
Proceeds".

Proposed NYSE Stock Symbol...................
</TABLE>

- ------------------------

(a) The offering of [ ] shares of Common Stock initially being offered in the
United States (the "U.S. Offering") and the concurrent offering of [ ]
shares of Common Stock initially being offered outside the United States
(the "International Offering") are collectively referred to as the
"Offerings". The underwriters for the U.S. Offering (the "U.S.
Underwriters") and the underwriters for the International Offering (the
"International Underwriters") are collectively referred to as the
"Underwriters".

(b) Does not include [ ] shares of Common Stock issuable pursuant to options
outstanding prior to the Offerings. See "Management--Aggregated Option/SAR
Exercises in Last Fiscal Year and Year-End Option/ SAR Values".

RISK FACTORS

Prospective purchasers of the Common Stock should carefully consider the
factors set forth under "Risk Factors" immediately following this Prospectus
Summary as well as the other information set forth in this Prospectus.

7
<PAGE>
SUMMARY FINANCIAL AND OPERATING DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA AND COPPER PRICES)

The following table sets forth (i) summary combined historical consolidated
financial data of the Company for the twelve months ended December 31, 1992
(which includes historical consolidated financial data of the Company prior to
the Acquisition ("Predecessor") for the nine-month period ended September 30,
1992, and historical consolidated financial data of the Company after the
Acquisition for the three-month period ended December 31, 1992), (ii) selected
historical consolidated financial data of the Company for the years ended
December 31, 1993, 1994, 1995 and 1996 and as of December 31, 1996 and (iii) as
adjusted and pro forma financial data as of and for the year ended December 31,
1996, assuming the use of the net proceeds of Offerings as described under "Use
of Proceeds". Combined summary financial data presented below for the 12-month
period ended December 31, 1992 were derived from audited consolidated financial
statements of the Company and Predecessor not included in this Prospectus. The
summary consolidated financial data presented below for the year ended December
31, 1993, were derived from audited consolidated financial statements not
included in this Prospectus. The summary consolidated financial data presented
below for the years ended December 31, 1994, 1995 and 1996, and as of December
31, 1996, were derived from the Consolidated Financial Statements of the Company
included elsewhere in this Prospectus. This data should be read in conjunction
with "Use of Proceeds", "Capitalization", "Management's Discussion and Analysis
of Results of Operations and Financial Condition" and the Consolidated Financial
Statements included elsewhere herein.

<TABLE>
<CAPTION>
COMBINED(a)
---------------
TWELVE MONTHS
ENDED YEAR ENDED DECEMBER 31,
DECEMBER 31, ------------------------------------------------
1992 1993 1994 1995 1996
--------------- --------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net sales.................................... $ 909,351 $ 868,846 $ 1,010,075 $ 1,201,650 $ 1,332,049
Cost of goods sold........................... 780,148 745,875 846,611 1,030,511 1,102,460
Selling and administrative expense........... 80,590 75,748 85,209 93,401 121,054
Other (income) expense, net (b).............. (305) (196) 1,114 1,032 2,045
Unusual items (c)............................ 18,139 -- -- -- --
--------------- --------- ----------- ----------- -----------
Income from operations....................... 30,779 47,419 77,141 76,706 106,490
Interest expense............................. 50,645 56,723 60,155 49,055 39,994
--------------- --------- ----------- ----------- -----------
Income (loss) before income taxes and
extraordinary charge....................... (19,866) (9,304) 16,986 27,651 66,496
Provision (benefit) for income taxes......... (4,022) 1,552 9,500 14,380 28,988
--------------- --------- ----------- ----------- -----------
Income (loss) before extraordinary charge.... (15,844) (10,856) 7,486 13,271 37,508
Extraordinary charge net of income tax
benefit (d)................................ 122 3,367 -- 2,971 1,183
--------------- --------- ----------- ----------- -----------
Net income (loss)............................ $ (15,966) $ (14,223) $ 7,486 $ 10,300 $ 36,325
--------------- --------- ----------- ----------- -----------
--------------- --------- ----------- ----------- -----------
Income (loss) per share (e):
Income (loss) before extraordinary
charge................................... $ $ $ $
Extraordinary charge net of income tax
benefit.................................. --
--------- ----------- ----------- -----------
--------- ----------- ----------- -----------
Net income (loss).......................... $ $ $ $
--------- ----------- ----------- -----------
--------- ----------- ----------- -----------
Shares used in computing net income (loss)
per share..................................
--------- ----------- ----------- -----------
--------- ----------- ----------- -----------
Pro forma income before extraordinary
charge..................................... $
-----------
-----------
Pro forma income per share before
extraordinary charge (e)................... $
-----------
-----------
Shares used in computing pro forma income
before extraordinary charge................
-----------
-----------
</TABLE>

8
<PAGE>

<TABLE>
<CAPTION>
DECEMBER 31, 1996
-----------------------
<S> <C> <C>
ACTUAL AS ADJUSTED
--------- ------------
BALANCE SHEET DATA:
Working capital......................................................................... $ 231,707 $
Total assets............................................................................ 842,755
Long-term debt (including current portion).............................................. 432,916
Total stockholders' equity (f).......................................................... 158,716
</TABLE>

- ------------------------

(a) Represents a combination of the Company's three month period ended December
31, 1992 and Predecessor's nine month period ended September 30, 1992. Such
combined results are not necessarily indicative of the results for the full
year, due to the effects of the Acquisition and related refinancings and the
concurrent adoption of Statement of Financial Accounting Standards No. 109
"Accounting for Income Taxes". Financial data of the Company as of October
1, 1992, and thereafter reflect the Acquisition using the purchase method of
accounting, and, accordingly, the purchase price was allocated to assets and
liabilities based upon their estimated fair values. However, to the extent
that the Company's management had a continuing investment interest in the
Company's common stock, such fair values (and contributed stockholders'
equity) were reduced proportionately to reflect the continuing interest
(approximately 10%) at the prior historical cost basis.

(b) Includes interest income of $186, $269, $247, $409 and $210 for 1992, 1993,
1994, 1995 and 1996, respectively. Also includes write-offs related to fixed
asset disposals occurring in the normal course of business.

(c) In connection with the Acquisition, Predecessor recorded certain
merger-related expenses of $18,139, consisting primarily of bonus and option
payments to certain employees and certain merger fees and expenses that were
charged to Predecessor's operations in the nine months ended September 30,
1992.

(d) During 1992, the Company repurchased outstanding Essex Debentures (as
defined herein) resulting in an extraordinary charge of $122, net of
applicable income tax benefit. During 1993, the Company recognized
extraordinary charges of $3,055, net of applicable tax benefit, representing
the write-off of unamortized debt issuance costs associated with the
termination of the Company's term credit facility under its former credit
agreement, and $312, net of applicable tax benefit, representing the net
loss resulting from the redemption of the Essex Debentures. During 1995 and
1996, the Company recognized extraordinary charges of $2,971 and $1,183,
respectively, net of applicable tax benefit, representing the write-offs of
unamortized debt issuance cost associated with the termination of the
Company's former credit agreements.

(e) See Note 1 to the Consolidated Financial Statements.

(f) Includes common stock subject to put which was $12,626 as of December 31,
1996. Following the Offerings there will be no common stock subject to put.

(g) EBITDA is defined as earnings before net interest, income taxes,
depreciation and amortization. In 1992, EBITDA also includes an add-back of
$18,139 for unusual items. See note (c) above. EBITDA is presented because
it is a widely accepted financial indicator of a company's ability to incur
and service debt. However, EBITDA should not be considered in isolation or
as a substitute for net income or cash flow data prepared in accordance with
generally accepted accounting principles or as a measure of a company's
profitability or liquidity.

(h) Copper equivalent pounds include aluminum pounds which have been converted
to a copper pound basis.

9
<PAGE>
RISK FACTORS

IN ADDITION TO THE OTHER INFORMATION IN THIS PROSPECTUS, THE FOLLOWING
FACTORS SHOULD BE CONSIDERED CAREFULLY BY PROSPECTIVE INVESTORS IN EVALUATING
THE COMPANY BEFORE PURCHASING ANY COMMON STOCK OFFERED HEREBY. THIS PROSPECTUS
INCLUDES "FORWARD-LOOKING STATEMENTS". ALTHOUGH THE COMPANY BELIEVES THAT THE
EXPECTATIONS REFLECTED IN SUCH FORWARD-LOOKING STATEMENTS ARE REASONABLE, IT CAN
GIVE NO ASSURANCE THAT SUCH EXPECTATIONS WILL PROVE TO HAVE BEEN CORRECT.
IMPORTANT FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THE
COMPANY'S EXPECTATIONS ("CAUTIONARY STATEMENTS") ARE DISCLOSED IN THIS
PROSPECTUS, INCLUDING BELOW UNDER "RISK FACTORS". ALL SUBSEQUENT WRITTEN AND
ORAL FORWARD-LOOKING STATEMENTS ATTRIBUTABLE TO THE COMPANY OR PERSONS ACTING ON
ITS BEHALF ARE EXPRESSLY QUALIFIED IN THEIR ENTIRETY BY THE CAUTIONARY
STATEMENTS.

SUBSTANTIAL LEVERAGE

The Company has, and after giving effect to the Offerings and the
application of the proceeds therefrom will continue to have, on a consolidated
basis, substantial indebtedness and significant debt service obligations. After
giving pro forma effect to the Offerings and the application of the proceeds
therefrom, the Company's aggregate notes payable to banks plus long-term debt
would have been $[ ]million as of December 31, 1996. The Company's ratio of
debt to total capital would have been approximately [ ] to 1 at December 31,
1996, after giving pro forma effect to the Offerings and the application of the
proceeds therefrom.

The degree to which the Company is leveraged could have important
consequences to holders of the Common Stock, including the following: (i) the
Company's ability to obtain additional financing for working capital, capital
expenditures, acquisitions, general corporate purposes or other purposes may be
impaired in the future; (ii) a substantial portion of the Company's cash flow
from operations must be dedicated to the payment of principal and interest on
its indebtedness, thereby reducing the funds available to the Company for other
purposes; (iii) certain of the Company's borrowings are, and will continue to
be, at variable rates of interest, which exposes the Company to the risk of
increased interest rates; (iv) the indebtedness outstanding under the Essex
Revolving Credit Agreement (as defined in "Management's Discussion and Analysis
of Financial Condition and Results of Operations--Liquidity, Capital Resources
and Financial Condition") is secured by substantially all the assets of the
Company; (v) the Company may be substantially more leveraged than certain of its
competitors, and this may place the Company at a competitive disadvantage; and
(vi) the Company's substantial degree of leverage may hinder its ability to
adjust rapidly to changing market conditions and could make it more vulnerable
in the event of a downturn in general economic conditions or a downturn in its
business.

INTEGRATING ACQUISITIONS AND MANAGING GROWTH

The Company has recently completed several acquisitions of complementary
businesses, and its business strategy involves pursuing opportunities to grow
its business both internally and through selective acquisitions, investments,
joint ventures and strategic alliances. The Company's ability to implement its
growth strategy depends, in part, on its success in making such acquisitions,
investments, joint ventures and strategic alliances on satisfactory terms and
successfully integrating them, including its recent acquisitions of Brownell,
BICC Canada and Triangle, into the Company's operations. Implementation of the
Company's growth strategy may impose significant strains on the Company's
management, operating systems and financial resources. Failure by the Company to
manage its growth, or unexpected difficulties encountered during expansion,
could have a material adverse impact on the Company's results of operations,
cash flows or financial condition.

10
<PAGE>
ADVANCING TECHNOLOGY

The Company believes that incorporating technological advancements in its
product development and manufacturing processes is important to remaining
competitive in each of its business units. For example, the demand for more
energy-efficient products, as well as lighter and smaller products, is
necessitating the engineering of more efficient and lighter components,
including wire and cable components included in these products. There can be no
assurance that the Company will successfully introduce new products or product
enhancements that will meet with commercial acceptance, or that its existing
technology will not be superceded by new technological breakthroughs introduced
by competitors. The commercial development of fiber optics has had and is
expected to continue to have an adverse effect on the Company's copper
communications wire business unit, and in particular its OSP products. Future
technological developments could materially adversely affect the Company's
results of operations, cash flows and financial condition.

COMPETITION

The manufacture and sale of copper wire and cable products is highly
competitive, and some of the Company's competitors may have greater financial
resources than the Company. The Company competes with at least one major
competitor with respect to each of its business units. No single competitor,
however, competes with the Company across the entire spectrum of the Company's
product lines. Many of the Company's products are made to industry
specifications and therefore may be fungible with competitors' products.
Accordingly, the Company is subject to competition in many markets on the basis
of price, delivery time, customer service and its ability to meet specialty
needs. In addition, the Company has been subject to competition from foreign
manufacturers from time to time and such competition may continue in the future.
Although foreign manufacturers do not presently constitute an important source
of competition, there can be no assurance that this will continue to be the case
in the future.

INTERNATIONAL EXPANSION

To date, a substantial majority of the Company's sales have been made in the
North American market, where the Company believes it has substantial expertise
and experience. The Company intends, however, to pursue international
opportunities for growth. International expansion will create new challenges for
the Company's management. If the Company is successful in increasing its
international business, it may encounter new risks that have not traditionally
been encountered, including potential political, social and economic
instability. In addition, risks associated with fluctuations between the U.S.
dollar, which is the reporting currency in the Company's financial statements,
and the local currencies in which the Company may transact business, may be
encountered. There can be no assurance that expansion of the Company's
operations to international markets will not have any adverse consequences for
the Company's results of operations, cash flows or financial condition.

COMPLIANCE WITH ENVIRONMENTAL REGULATIONS

The Company is subject to federal, state and local environmental protection
laws and regulations governing its operations and use, handling, disposal and
remediation of hazardous substances currently or formerly used by the Company. A
risk of environmental liability is inherent in the current and former
manufacturing activities of the Company in the event of a release or discharge
of a hazardous substance generated by the Company. Under certain environmental
laws, the Company could be held jointly and severally responsible for the
remediation of any hazardous substance contamination at its facilities and at
third party waste disposal sites and could also be held liable for any
consequences arising out of human exposure to such substances or other
environmental damage. The Company has been named as a potentially responsible
party in proceedings that involve environmental remediation. The Company has
also been named as a defendant in lawsuits alleging exposure to asbestos in the

11
<PAGE>
Company's products. See "Business--Legal and Environmental Matters". There can
be no assurance that the costs of complying with environmental, health and
safety laws in its current operations or the liabilities arising from past
releases of, or exposure to, hazardous substances, will not result in future
expenditures by the Company that could materially and adversely affect the
Company's results of operations, cash flows or financial condition.

COPPER PRICES

Net sales of the Company are heavily influenced by the price of copper, the
Company's major raw material. The Company's net income has limited exposure to
the price of copper, however, as the Company has historically been able to pass
through copper price increases and decreases to its customers on a current or
slightly delayed basis. In addition, the Company has generally been able to
match its copper purchases with its production requirements and minimize copper
cathode and rod inventories. However, no assurance can be given that the Company
will be able to pass through price increases in the future.

MANUFACTURING CAPACITY

The Company is currently operating its manufacturing facilities at high
utilization rates. In order to meet growing customer demand, the Company will
need to invest in additional manufacturing equipment. Failure to have new
equipment operational in a timely manner or shut-downs of existing capacity due
to breakdowns or other reasons could adversely affect the Company's results of
operations, cash flows and financial condition.

HOLDING COMPANY STRUCTURE; RESTRICTIONS ON THE PAYMENT OF DIVIDENDS; ESSEX
INTERNATIONAL'S DEPENDENCE ON DIVIDENDS FROM ESSEX TO MEET CASH REQUIREMENTS

Essex International is a holding company whose operations are and will be
conducted solely through Essex, its wholly owned subsidiary. Essex International
has no independent operations, virtually no assets other than its ownership of
the outstanding common stock of Essex (all of which is pledged to the lenders
under the Essex Revolving Credit Agreement) and no independent means of
generating cash flow. Therefore, Essex International is and will continue to be
dependent on the cash flow of Essex to meet its obligations.

At present, Essex International's cash requirements are not significant. The
Essex Revolving Credit Agreement and the Essex Senior Note Indenture (as defined
in "Description of Certain Indebtedness") restrict the ability of Essex to
declare and pay dividends and to make other distributions to Essex
International. Subject to the availability of an alternative financing source,
Essex International's ability to meet its cash obligations in the future will be
dependent upon Essex's ability to pay dividends, to loan, or otherwise advance
or transfer funds to Essex International in sufficient amounts. Additionally,
the Essex Revolving Credit Agreement prohibits the Company from paying dividends
to its common stockholders. See "Description of Certain Indebtedness--Essex
Revolving Credit Agreement".

PRINCIPAL STOCKHOLDERS

After the Offerings, BH Group will own approximately [ ]% (([ ]% on a
fully diluted basis), and [ ]% ([ ]% on a fully diluted basis) if the
Underwriters' over-allotment option is exercised in full) of the outstanding
Common Stock. In addition, after consummation of the Offerings, members of the
Company's Board of Directors will be affiliated with BH Group. As long as BH
Group continues to own in the aggregate a large percentage of the outstanding
shares of Common Stock, it will have practical control over the composition of
the Board of Directors of the Company, over the outcome of any corporate
transaction or other matter submitted to the stockholders for approval,
including mergers, consolidations and the sale of all or substantially all the
Company's assets, and over a change in control of the

12
<PAGE>
Company. See "Management", "Principal and Selling Stockholders" and "Certain
Relationships and Related Party Transactions".

BENEFITS OF THE OFFERINGS TO CURRENT SECURITYHOLDERS

The Offerings will provide significant benefits to the current
securityholders of the Company, including the creation of a public market for
the Common Stock and the receipt of $ in proceeds by the GS
Partnerships, $ in proceeds by DLJ and $ in proceeds by CEA.

ANTI-TAKEOVER PROVISIONS

The Company's Second Amended and Restated Certificate of Incorporation (the
"Restated Certificate"), which will be effective upon consummation of the
Offerings, and the By-laws, as amended (the "By-laws"), contain certain
provisions that may have the effect of discouraging, delaying or preventing a
change in control of the Company or unsolicited acquisition proposals that a
stockholder might consider favorable, including provisions authorizing the
issuance of "blank check" preferred stock, limiting the persons who may call
special meetings of stockholders, limiting stockholder action by written
consent, establishing advance notice requirements for nominations for election
to the Board of Directors of the Company or for proposing matters that can be
acted upon at stockholders meetings, providing for a Board of Directors with
staggered, three-year terms and requiring super-majority voting to effect
certain amendments to the Restated Certificate and the By-laws.

SHARES ELIGIBLE FOR FUTURE SALE

Sales of a substantial number of shares of Common Stock after the Offerings
could adversely affect the market price of the Common Stock and could impair the
Company's ability to raise capital through the sale of equity securities. Upon
completion of the Offerings, the Company will have [ ] shares of Common Stock
outstanding. Of these shares, the [ ] shares sold in the Offerings will be
freely transferable without restriction under the Securities Act of 1933 (the
"Securities Act"), unless they are held by "affiliates" of the Company as that
term is used under the Securities Act.

The remaining [ ] outstanding shares were sold by the Company in reliance
on exemptions from the registration requirements of the Securities Act, are
restricted securities within the meaning of Rule 144 under the Securities Act
("Rule 144") and may not be resold in the absence of registration under the
Securities Act or an available exemption therefrom. The Company, each of the
Company's directors and executive officers, BH Group, each Selling Stockholder
and certain other stockholders of the Company holding [ ] shares of Common
Stock have agreed not to sell or otherwise dispose of any shares of Common Stock
for the 180-day period after the date of this Prospectus without the prior
written consent of Goldman, Sachs & Co ("Goldman Sachs"). Any shares subject to
such lock-up agreements may be released at any time without notice by Goldman
Sachs. See "Underwriting". Additionally, each stockholder (other than BHLP and
certain of its affiliates) has agreed not to sell any of its Common Stock for 90
days after the effective date of the Registration Statement of which this
Prospectus is a part (the "Effective Date") pursuant to either the Management
Stockholders Agreement or the Registration Rights Agreement (as defined in
"Certain Relationships and Related Party Transactions" and "Shares Eligible for
Future Sale-Other Initial Shareholders" respectively). Thus none of these shares
of Common Stock will be eligible for sale in the public market immediately upon
the Effective Date. Beginning 90 days after the Effective Date, approximately
[ ] of these shares will become eligible for sale subject to the provisions
of Rule 144 and Rule 701 ( of which will be eligible, under Rule 144(k),
for sale without limitation as to volume and manner of sale). Beginning 180 days
after the date of this Prospectus, approximately [ ] additional shares will
become eligible for sale subject to the provisions of Rule 144 or Rule 701
( of which will be eligible, under Rule 144(k), for sale without
limitation as to volume and manner of sale). See "Shares Eligible for Future
Sale".

13
<PAGE>
BH Group has the right, pursuant to the Management Stockholders Agreement,
to require that the Company register, pursuant to the Securities Act, any or all
of its shares of Common Stock. BH Group is not restricted in the number of times
it may require the Company to register its shares of Common Stock. It is
anticipated that pursuant to the BH Group Registration Rights Agreement, BH
Group will also have the right to require the Company to prepare and file with
the Securities and Exchange Commission, a "shelf" registration statement
covering offers and sales in accordance with Rule 415 under the Securities Act
of some or all of the Common Stock held by BH Group. Pursuant to the
Registration Rights Agreement, the GS Partnerships and DLJ each have the ability
to require the Company to register any or all of the shares of Common Stock held
by them pursuant to the Securities Act. The GS Partnerships and DLJ each have
the unqualified right to make two such demands and a qualified right to make one
additional demand. The GS Partnerships, DLJ and CEA also have the right to
"piggyback", or include their Common Stock, in any registration of Common Stock
made by the Company. At the request of Goldman Sachs or DLJSC, the Company also
is obligated to file a registration statement in connection with the
market-making activities of Goldman Sachs or DLJSC. Pursuant to the Management
Stockholders Agreement, certain employee stockholders have the right to
"piggyback" onto certain registrations of Common Stock (i) demanded by BH Group
or (ii) for primary offerings by the Company. The existence of the registration
rights described above could have an adverse effect on the market price of the
Common Stock, could impair the Company's ability to raise capital through the
sale of equity securities and may involve added costs and complexity in the
event the Company or any holder of registration rights desires to register
shares of Common Stock in the future. See "Certain Relationships and Related
Party Transactions--Management Stockholders Agreement" and "Shares Eligible for
Future Sale-- Piggyback Registration Rights".

DILUTION

Persons purchasing shares of Common Stock in the Offerings will incur
immediate and substantial dilution in net tangible book value per share.
Assuming an initial public offering price of $ per share (the midpoint
of the range of initial public offering prices set forth on the cover page of
this Prospectus), purchasers of shares in the Offerings will experience dilution
of $ per share. See "Dilution".

NO PRIOR MARKET FOR THE COMMON STOCK; POSSIBLE VOLATILITY OF SHARE PRICE

Prior to the Offerings there has been no public market for the Common Stock
and there can be no assurance that an active trading market will develop upon
completion of the Offerings or, if it does develop, that such market will be
sustained. The initial public offering price of the Common Stock will be
determined by negotiation among the Company, the Selling Stockholders and the
representatives of the Underwriters, and may not be representative of the price
that will prevail in the open market. See "Underwriting" for a discussion of the
factors to be considered in determining the initial public offering price.

The market price of the Common Stock after the Offerings may be
significantly affected by factors such as quarterly variations in the Company's
results of operations, the announcement of new products or product enhancements
by the Company or its competitors, technological innovation by the Company or
its competitors and general market conditions specific to particular industries.
Such fluctuations may adversely affect the market price of the Common Stock.

14
<PAGE>
USE OF PROCEEDS

The net proceeds to the Company from the sale of the shares of Common Stock
by the Company hereby are estimated to be approximately $68.5 million, after
deducting the estimated underwriting discount, transaction fees and expenses of
the Offerings payable by the Company. The Company will not receive any proceeds
from the sale of Common Stock by the Selling Stockholders. The net proceeds to
the Company of the Offerings will be used to repay in full the Essex Term Loan
and repay a portion of the indebtedness under the Essex Revolving Credit
Agreement (each as defined in "Description of Certain Indebtedness"). The Essex
Term Loan and the Essex Revolving Credit Agreement mature in May 2000 and
October 2001, respectively, and currently bear interest at average per annum
rates of 9.31% and 6.85%, respectively. Borrowings under the Essex Term Loan
were used to redeem other indebtedness as part of the 1995 Refinancing.
Borrowings under the Essex Revolving Credit Agreement were used to refinance the
Company's prior revolving credit agreement, to finance the acquisition of
Triangle and for working capital. See "Description of Certain
Indebtedness--Essex Revolving Credit Agreement".

DIVIDEND POLICY

No dividends have been paid by the Company on the Common Stock in the prior
two fiscal years and the Company does not anticipate paying dividends in the
foreseeable future. Any determination to pay cash dividends in the future will
be at the discretion of the Company's Board of Directors and will depend upon
the Company's results of operations, financial condition, contractual
restrictions and other factors deemed relevant at that time by the Company's
Board of Directors.

The ability of the Company to pay dividends on the Common Stock is dependent
upon the ability of Essex to pay dividends, or otherwise loan, advance or
transfer funds, to the Company. Both the Essex Revolving Credit Agreement and
the Senior Note Indenture impose limitations on the ability of Essex to pay
dividends or make other payments to the Company and the Essex Revolving Credit
Agreement also prohibits the Company from paying dividends to its common
stockholders. See "Description of Certain Indebtedness--Essex Revolving Credit
Agreement--Negative Covenants".

15
<PAGE>
DILUTION

Dilution is the amount by which the offering price paid by the purchasers of
the Common Stock offered hereby will exceed the net tangible book value per
share of Common Stock after the Offerings. Net tangible book value per share is
determined at any date by subtracting the total liabilities of the Company from
the total book value of the tangible assets of the Company and dividing the
difference by the number of shares of Common Stock deemed to be outstanding at
such date.

The net tangible book value of the Company on December 31, 1996, was
approximately $[ ]. Net tangible book value per share represents the amount
of total tangible assets less the amount of total liabilities divided by the
total number of shares of Common Stock outstanding. After giving effect to the
receipt of approximately $[ ] million of estimated net proceeds of the sale
by the Company of [ ] shares of Common Stock pursuant to the Offerings
(assuming a public offering price of $[ ] per share, the midpoint of the
range of initial public offering prices set forth on the cover page of this
Prospectus), the pro forma net tangible book value of the Company at December
31, 1996, would have been approximately $[ ] or $[ ] per share. This
change represents an immediate increase in pro forma net tangible book value of
$[ ] per share to the existing stockholders and an immediate dilution of
$[ ] per share to new investors purchasing shares of Common Stock in the
Offerings. The following table illustrates the substantial and immediate
dilution to new investors:

<TABLE>
<CAPTION>
PER SHARE
--------------------
<S> <C> <C>
Initial public offering price per share................................ $
Pro forma net tangible book value per share before Offerings....... $
Increase per share attributable to new
investors (a)....................................................
---------
Pro forma net tangible book value per share after Offerings (a)........
---------
Dilution per share to new investors (b)(c)............................. $
---------
---------
</TABLE>

- ------------------------

(a) Before deducting underwriting discounts and estimated transaction fees and
expenses of $[ ] million to be paid by the Company in connection with the
Offerings.

(b) Dilution is determined by adding net tangible deficit per share after the
Offerings to the amount assumed paid by a new investor per share of Common
Stock.

(c) Assuming the Underwriters' over-allotment option is exercised in full, pro
forma net tangible book value of the Company after the Offerings would be
$[ ] per share, the immediate increase in pro forma net tangible book
value of shares owned by the existing stockholders would be $[ ] per
share and the immediate dilution to new investors would be $[ ] per
share.

The following table summarizes the difference between existing stockholders
(determined as if the Offerings had occurred on December 31, 1996) and new
investors with respect to the number of shares of Common Stock purchased from
the Company, the total consideration paid to the Company and the average price
paid per share (assuming the Underwriters' overallotment options are not
exercised and

16
<PAGE>
an initial public offering price of $[ ] per share, the midpoint of the range of
initial public offering prices set forth on the cover page of this Prospectus).

<TABLE>
<CAPTION>
SHARES PURCHASED TOTAL CONSIDERATION
--------------------------- --------------------------- AVERAGE PRICE
NUMBER PERCENTAGE AMOUNT PERCENTAGE PER SHARE
----------- -------------- ----------- -------------- -----------------
<S> <C> <C> <C> <C> <C>
New investors (a)............................ % $ % $
Existing stockholders (a).................... (b)
Total........................................ 100.0% 100.0%
</TABLE>

- ------------------------

(a) Sales by the Selling Stockholders in the Offerings will reduce the number of
shares held by existing stockholders to [ ] shares, or approximately
[ ]% ([ ] shares or approximately [ ]%, if the Underwriters'
overallotment options are exercised in full) of the total number of shares
of Common Stock to be outstanding after the Offerings and will increase the
number of shares held by new investors to [ ], or approximately [ ]%
([ ] shares, or approximately [ ]%, if the Underwriters' overallotment
options are exercised in full) of the total shares of Common Stock to be
outstanding after the Offerings. See "Principal and Selling Stockholders".

(b) Does not include [ ] shares of Common Stock that the Underwriters have the
option to purchase from the Selling Shareholders to cover over-allotments,
if any, or [ ] shares of Common Stock reserved for issuance under the
Company's stock option plans. See "Management--Executive
Compensation--Option Plans" and "Underwriting".

The foregoing tables and discussion assume no exercise of options after
December 31, 1996 and exclude (i) 2,870,975 shares issuable upon exercise of
options outstanding as of December 31, 1996 having a weighted average exercise
price of $3.52 per share under the Company's Stock Option Plan, (ii) 730,000
shares issuable upon exercise of options granted on January 30, 1997 in
connection with the Company's 1996 performance and to maintain management's
equity interest in the Company as a result of the increase in total Common Stock
outstanding following the 1996 Private Offering and (iii) 1,027,344 additional
shares authorized for issuance under the Company's Stock Option Plan. To the
extent that outstanding options are exercised, there will be further dilution to
new investors. See "Capitalization", "Management--Compensation of Directors and
Executive Officers", "Management--Stock Option Plan", and Note 8 to the
Consolidated Financial Statements.

17
<PAGE>
CAPITALIZATION

The following table sets forth the consolidated capitalization of the
Company as of December 31, 1996, and on an as-adjusted basis after giving effect
to the Offerings and the application of the net proceeds of the Company
therefrom. The table should be read in conjunction with "Use of Proceeds",
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" and the Consolidated Financial Statements included elsewhere in this
Prospectus.
<TABLE>
<CAPTION>
DECEMBER 31, 1996
----------------------------
<S> <C> <C>
ACTUAL AS ADJUSTED
----------- ---------------

<CAPTION>
(DOLLARS IN THOUSANDS)
<S> <C> <C>
Cash................................................................................ $ 4,429 $
----------- ---------------
----------- ---------------
Notes payable and current portion of long-term debt................................. $ 42,489 $
Long-term debt:
Essex Revolving Credit Agreement.................................................. 179,900
Essex Term Loan................................................................... 31,766
Essex Senior Notes................................................................ 200,000
Essex Sale and Leaseback Agreement................................................ 21,250
-----------
432,916
Less: current portion......................................................... 11,576
----------- ---------------
Total long-term debt................................................................ 421,340
Common stock subject to put:(a)
1,262,602 shares issued and outstanding........................................... 12,626 --
Other stockholders' equity:
Common Stock, par value $.01 per share; 150,000,000 shares authorized, 22,793,955
shares issued and outstanding, actual; [ ]
shares issued and outstanding, as adjusted (b).................................. 228
Additional paid-in capital........................................................ 133,526
Carryover of predecessor basis (c)................................................ (15,259)
Retained earnings................................................................. 27,595
-----------
Total other stockholders' equity.................................................... 146,090
----------- ---------------
Total capitalization.......................................................... $ 622,545 $
----------- ---------------
----------- ---------------
</TABLE>

- ------------------------

(a) Following the Offerings there will be no common stock subject to put.

(b) Excludes 2,870,975 shares of Common Stock reserved for issuance pursuant to
the exercise of options outstanding as of January 1, 1997, at a weighted
average exercise price of $3.52 per share, of which options to purchase
1,828,475 shares of Common Stock were then exercisable. On January 30, 1997,
the Company granted 730,000 additional options at an exercise price of
$10.00 per share in respect of 1996 performance and to maintain management's
equity interest in the Company as a result of the increase in total Common
Stock outstanding following the 1996 Private Offering. Since December 31,
1996, no shares have been issued upon exercise of outstanding options. See
"Management--Stock Option Plans".

18
<PAGE>
SELECTED CONSOLIDATED FINANCIAL AND OPERATING DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA AND COPPER PRICES)

The following table sets forth (i) selected combined historical consolidated
financial data of the Company as of and for the twelve months ended December 31,
1992 (which includes historical consolidated financial data of the Company prior
to the Acquisition ("Predecessor") for the nine-month period ended September 30,
1992, and historical consolidated financial data of the Company after the
Acquisition for the three-month period ended December 31, 1992), (ii) selected
historical consolidated financial data of the Company as of and for the years
ended December 31, 1993, 1994, 1995 and 1996 and (iii) pro forma financial data
for the year ended December 31, 1996, assuming the use of the net proceeds of
the Offerings as described under "Use of Proceeds". Combined selected financial
data presented below as of and for the 12-month period ended December 31, 1992
were derived from audited consolidated financial statements of the Company and
Predecessor not included in this Prospectus. The selected consolidated financial
data presented below as of December 31, 1993 and 1994 and for the year ended
December 31, 1993 were derived from audited consolidated financial statements
not included in this Prospectus. The selected consolidated financial data
presented below as of December 31, 1995 and 1996 and for the years ended
December 31, 1994, 1995 and 1996 were derived from the Consolidated Financial
Statements of the Company included elsewhere in this Prospectus. This data
should be read in conjunction with "Use of Proceeds", "Capitalization",
"Management's Discussion and Analysis of Results of Operations and Financial
Condition" and the Consolidated Financial Statements included elsewhere herein.

<TABLE>
<CAPTION>
COMBINED(a)
------------------
TWELVE MONTHS
ENDED YEAR ENDED DECEMBER 31,
DECEMBER 31, ----------------------------------------------------
1992 1993 1994 1995 1996
------------------ ---------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net sales.............................. $ 909,351 $ 868,846 $ 1,010,075 $ 1,201,650 $ 1,332,049
Cost of goods sold..................... 780,148 745,875 846,611 1,030,511 1,102,460
Selling and administrative expense..... 80,590 75,748 85,209 93,401 121,054
Other (income) expense, net (b)........ (305) (196) 1,114 1,032 2,045
Unusual items (c)...................... 18,139 -- -- -- --
---------- ---------- ------------ ------------ ------------
Income from operations................. 30,779 47,419 77,141 76,706 106,490
Interest expense....................... 50,645 56,723 60,155 49,055 39,994
---------- ---------- ------------ ------------ ------------
Income (loss) before income taxes and
extraordinary charge................. (19,866) (9,304) 16,986 27,651 66,496
Provision (benefit) for income taxes... (4,022) 1,552 9,500 14,380 28,988
---------- ---------- ------------ ------------ ------------
Income (loss) before extraordinary
charge............................... (15,844) (10,856) 7,486 13,271 37,508
Extraordinary charge net of income tax
benefit (d).......................... 122 3,367 -- 2,971 1,183
---------- ---------- ------------ ------------ ------------
Net income (loss)...................... $ (15,966) $ (14,223) $ 7,486 $ 10,300 $ 36,325
---------- ---------- ------------ ------------ ------------
---------- ---------- ------------ ------------ ------------
Income (loss) per share (e):
Income (loss) before extraordinary
charge............................. $ $ $ $
Extraordinary charge net of income
tax benefit........................
---------- ------------ ------------ ------------
Net income (loss).................... $ $ $ $
---------- ------------ ------------ ------------
---------- ------------ ------------ ------------
Shares used in computing net income
(loss) per share.....................
---------- ------------ ------------ ------------
---------- ------------ ------------ ------------
Pro forma income before extraordinary
charge............................... $
------------
------------
Pro forma income per share before
extraordinary charge (e)............. $
------------
------------
Shares used in computing pro forma
income before extraordinary charge...
</TABLE>

19
<PAGE>

<TABLE>
<CAPTION>
COMBINED
TWELVE MONTHS
ENDED YEAR ENDED DECEMBER 31,
DECEMBER 31, ----------------------------------------------
1992 1993 1994 1995 1996
------------------ ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
BALANCE SHEET DATA:
Working capital.............................. $ 133,048 $ 176,001 $ 221,480 $ 171,166 $ 231,707
Total assets................................. 716,196 712,051 750,930 746,063 842,755
Long-term debt (including current portion)... 420,052 428,942 458,960 412,750 432,916
Redeemable preferred stock................... 28,603 34,460 41,155 48,820 --
Total stockholders' equity(f)................ 85,555 65,475 66,302 69,103 158,716

OTHER DATA:
EBITDA (g)................................... $ 74,388 $ 77,028 $ 108,314 $ 110,502 $ 140,224
Capital expenditures......................... $ 31,180 $ 26,167 $ 30,109 $ 28,555 $ 25,569
Copper equivalent pounds shipped(h).......... 492,350 517,607 553,220 551,447 643,800
Average COMEX copper price per pound......... $ 1.03 $ 0.85 $ 1.07 $ 1.35 $ 1.06
</TABLE>

- ------------------------

(d) During 1992, the Company repurchased outstanding Essex Debentures resulting
in an extraordinary charge of $122, net of applicable income tax benefit.
During 1993, the Company recognized extraordinary charges of $3,055, net of
applicable tax benefit, representing the write-off of unamortized debt
issuance costs associated with the termination of the Company's term credit
facility under its former credit agreement, and $312, net of applicable tax
benefit, representing the net loss resulting from the redemption of the
Essex Debentures. During 1995 and 1996, the Company recognized extraordinary
charges of $2,971 million and $1,183 million, respectively, net of
applicable tax benefit, representing the write-offs of unamortized debt
issuance cost associated with the termination of the Company's former credit
agreements.

(e) See Note 1 to the Consolidated Financial Statements.

(f) Includes common stock subject to put, which as of December 31, 1992, 1993,
1994, 1995 and 1996, was $7,056, $5,808, $5,474, $4,803 and $12,626,
respectively. Following the Offerings there will be no common stock subject
to put.

(h) Copper equivalent pounds include aluminum pounds which have been converted
to a copper pound basis.

20
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

OVERVIEW

The Company, founded in 1930, is a leading developer, manufacturer and
marketer of electrical wire and cable products. Among the Company's products are
magnet wire for electromechanical devices such as motors, transformers and
electrical controls; building wire for commercial and residential applications;
copper voice and data communication wire; automotive wire and specialty wiring
assemblies for automobiles and trucks; and industrial wire for applications in
appliances, construction and recreational vehicles. The Company's operations at
December 31, 1996 included 28 domestic manufacturing facilities and employed
approximately 4,800 persons.

As a result of the flexibility allowed by the 1995 Refinancing, the Company
embarked upon an opportunistic acquisition strategy. As a result of several
recent acquisitions, the Company has consolidated its market position in its
core products. The acquisition of certain assets of Avnet Inc's distribution
operation in 1995 (the "Brownell Acquisition") considerably strengthened the
Company's distribution business, particularly with respect to value-added magnet
wire products supplied to smaller customers. The acquisition of the building
wire assets of BICC Canada in 1996 expanded the Company's presence in the
Canadian building wire market. The recent acquisition of certain assets of
Triangle (the "Triangle Acquisition") has significantly expanded the Company's
building wire and industrial wire business units. The Triangle Acquisition is
expected to strengthen both the building wire and industrial wire business, and
thus the product mix of the Company will shift somewhat toward those two units.
The impact of sales and net income from those business units is thus expected to
have a proportionately greater effect on the Company in the future than in the
past.

Although net sales are heavily influenced by the price of copper, the
Company's major raw material, the Company's profitability is generally not
significantly affected by changes in copper prices, because the Company
generally has been able to pass on its cost of copper to its customers, and the
Company attempts to match its copper purchases with its production requirements,
thereby minimizing copper cathode and rod inventories. In the short term,
however, pronounced changes in the price of copper may tend to affect gross
profits within the building wire product line, because such changes affect cost
of goods sold more quickly than those changes can be reflected in the pricing of
building wire products. See "Business--Metals Operations".

The Company believes that it is only affected by inflation to the extent
that the economy in general is affected. Should inflationary pressures drive
costs higher, the Company believes that general industry price increases would
sustain operating results, although there can be no assurance that this will be
the case. In addition, the Company believes that its sensitivity to downturns in
its primary markets is less significant than it might otherwise be due to its
diverse customer base, broad product line and its strategy of attempting to
match its copper purchases with its needs.

21
<PAGE>
RESULTS OF OPERATIONS

The following table sets forth for each of the years in the three-year
period ended December 31, 1996, the dollar amounts and percentages of sales of
each of the Company's major product lines:

<TABLE>
<CAPTION>
(DOLLARS IN MILLIONS, EXCEPT FOR COPPER PRICE)
-------------------------------------------------------------------
1994(A) 1995(A) 1996
--------------------- --------------------- ---------------------
<S> <C> <C> <C> <C> <C> <C>
Magnet wire............................................ $ 306.9 30% $ 388.2 32% $ 388.8 29%
Building wire.......................................... 390.0 39 406.1 34 487.1 37
Communication wire..................................... 119.3 12 177.5 15 166.8 13
Automotive wire........................................ 82.8 8 97.3 8 91.2 7
Industrial wire........................................ 63.1 6 63.4 5 71.0 5
Other(b)............................................... 48.0 5 69.2 6 127.1 9
---------- --- ---------- --- ---------- ---
Total.................................................. $ 1,010.1 100% $ 1,201.7 100% $ 1,332.0 100%
---------- --- ---------- --- ---------- ---
---------- --- ---------- --- ---------- ---
Average COMEX copper price per pound................... $ 1.07 $ 1.35 $ 1.06
</TABLE>

- ------------------------

(a) Due to a reorganization in the third quarter of 1995, certain 1994 and 1995
product line sales have been reclassified.

(b) Includes sales of third-party manufactured products, including electrical
insulating products, electric motors, motor repair parts and pump seals,
sold through the Company's distribution business unit.

The following table sets forth for each of the years in the three-year
period ended December 31, 1996, the percentage relationship of net sales to
certain income statement items:

<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31,
-------------------------------
<S> <C> <C> <C>
1994 1995 1996
--------- --------- ---------
Net sales......................................................................... 100.0% 100.0% 100.0%
Cost of goods sold................................................................ 83.8 85.8 82.8
Selling and administrative expense................................................ 8.4 7.8 9.1
Other expense, net................................................................ 0.1 0.1 0.1
--------- --------- ---------
Income from operations............................................................ 7.7 6.3 8.0
Interest expense.................................................................. 6.0 4.0 3.0
--------- --------- ---------
Income before income taxes and extraordinary charge............................... 1.7 2.3 5.0
Provision for income taxes........................................................ 1.0 1.2 2.2
--------- --------- ---------
Income before extraordinary charge................................................ 0.7 1.1 2.8
Extraordinary charge--debt retirement, net of income tax benefit.................. -- 0.2 0.1
--------- --------- ---------
Net income........................................................................ 0.7% 0.9% 2.7%
--------- --------- ---------
--------- --------- ---------
</TABLE>

1996 COMPARED WITH 1995

Net sales for 1996 were $1,332.0 million or 10.8% greater than in 1995,
resulting primarily from improved sales volumes and increased sales attributable
to the Brownell Acquisition in September 1995 and the Triangle Acquisition in
October 1996, partially offset by lower copper prices. The 1996 daily average
COMEX copper price was 21.5% lower than in 1995. Sales volumes for 1996 exceeded
1995 by 16.9%. Improved sales volumes resulted primarily from increased demand
for the Company's magnet wire, building wire and industrial wire products.

Sales of magnet wire in 1996 were essentially equal to those in 1995,
reflecting increased sales volumes offset by declining copper prices. Improved
sales volumes were attributable to increased demand for magnet wire in the
electric motor and transformer markets due in part to the increased use of
magnet wire for increased energy efficiency. Sales increases were also a result
of increased sales to distributors.

22
<PAGE>
Building wire sales for 1996 increased as compared to 1995 due primarily to
an increase in sales volumes, product pricing (without regard to copper costs)
and incremental sales attributable to the Triangle Acquisition, partially offset
by a decline in copper prices. Building wire market demand exhibited continued
growth during 1996 on the strength of new non-residential construction and
sustained expansion of the repair and remodeling segment of the market. The
Company believes that this growth in demand was the leading cause for the
improvement in market prices during the second half of 1996 over the depressed
market conditions of 1995 and the first half of 1996. No assurance, however, can
be given that such favorable market conditions will continue in 1997.

Communication wire sales for 1996 were below those in 1995 due to the
decrease in copper prices partially offset by increased sales of premise wire
products. Premise wire sales were up 21.2% with volume up 31.5% as compared to
1995, reflecting continued strong growth in this segment of the communication
wire market. OSP sales volumes were 8.6% lower than 1995, reflecting, in part, a
decline in export sales, as the Company focused on strong domestic markets. The
Company believes that decreases in the domestic OSP copper wire market may lead
to reduced margins in the communications wire business unit in the future.

Automotive wire sales in 1996 were below those in 1995 due to the decrease
in copper prices partially offset by improved sales volumes as North American
new car and light truck sales volume increased just over 1% in 1996. Industrial
wire sales in 1996 were above those in 1995 by 12.0% due to an increase in sales
volume partially offset by the decline in copper prices. The increase in sales
volume was partially due to incremental sales attributable to the Triangle
Acquisition. Other sales in 1996 increased significantly over 1995 due to the
effect of inclusion of full-year sales from the Brownell Acquisition.

Cost of goods sold for 1996 was 7.0% higher than in 1995 due primarily to
higher sales volumes and increased sales attributable to the Brownell
Acquisition and the Triangle Acquisition, partially offset by lower copper
prices. The Company's cost of goods sold as a percentage of net sales was 82.8%
and 85.8% in 1996 and 1995, respectively. Cost of goods sold as a percentage of
net sales decreased compared to 1995 due primarily to the marked decline in
copper costs, improved building wire product pricing (without regard to copper
costs), a change in product mix associated with the Brownell Acquisition, which
tends to distribute more value-added products, and higher manufacturing volumes,
leading to increased manufacturing efficiency.

Selling and administrative expenses for 1996 were 29.6% above 1995, due
primarily to increased selling, distribution and administrative expenses
attributable to the Brownell Acquisition, the Triangle Acquisition and increased
distribution and commission expenses due to higher sales volumes experienced
during 1996.

Interest expense in 1996 was 18.5% lower than in 1995 due primarily to the
redemption (the "Redemption") on May 15, 1995 of all Essex International's
outstanding Senior Discount Debentures due 2004 (the "Debentures"). The
Debentures, which bore interest at 16% per annum, were refinanced primarily with
bank debt carrying significantly lower rates of interest. See "--Liquidity,
Capital Resources and Financial Condition". The Company's average interest rate
decreased from 10.4% in 1995 to 8.6% in 1996 due to the Redemption.

Income tax expense was 43.6% of pretax income in 1996 compared with 52.0%
for 1995. The effective income tax rate of the Company is higher than the
approximate statutory rate of 40.0% due to the effect of the amortization of
excess of cost over net assets acquired in the Acquisition, which is not
deductible for income tax purposes.

The Company recorded net income of $36.3 million for 1996 compared to net
income of $10.3 million in 1995. The 1996 and 1995 results include extraordinary
charges of $1.2 million and $3.0 million, respectively ($2.0 million and $5.0
million, respectively, before applicable tax benefit) for the write-off of
unamortized deferred debt expense associated with the Company's former revolving
credit agreements.

23
<PAGE>
In 1996, a former revolving credit agreement was terminated in connection with
the Triangle Acquisition. In 1995, a former revolving credit agreement was
terminated in connection with the Redemption.

1995 COMPARED WITH 1994

Net sales for 1995 were $1,201.7 million or 19.0% higher than 1994,
reflecting primarily a marked increase in product prices and higher sales from
the Company's distribution business due to the Brownell Acquisition. Sales
volumes in 1995 approximated those experienced in 1994. Higher product prices
were essentially the result of a significant increase in copper costs. Average
COMEX copper prices in 1995 rose approximately 26.2% from 1994 and,
notwithstanding the magnitude of the price increase, was generally passed on to
customers through product pricing.

Sales of magnet wire increased approximately 26.5% over those in 1994,
driven by higher copper prices, improved pricing and growth in sales volumes.
Magnet wire sales volumes and product pricing improved during 1995 due to
increased demand for the Company's magnet wire products by distributors and
original equipment manufacturers.

Building wire sales in 1995 increased approximately 4.1% over 1994,
reflecting a combination of higher copper prices, lower sales volumes and a
steep decline in product pricing. Building wire product pricing (without regard
to copper costs) declined materially, and sales volumes also declined, although
to a lesser extent, due to competitive pricing pressures, excess capacity and
liquidation of inventories by distributors as a result of the significant
increase in copper prices in 1995.

Communication wire sales in 1995 improved approximately 48.8% over those in
1994 due to higher copper prices and domestic sales volumes and strengthening
product prices. Premise wire sales were up 54.1% with volumes 42.6% higher as
compared to 1994 while OSP sales were up 66% with volume up 11.6%. Export sales
were essentially flat between 1995 and 1994. The Company believes that
communication wire pricing strengthened due to significantly higher demand for
copper communication wire products coupled with a decline in industry
manufacturing capacity.

The Company's automotive wire sales volume in 1995 was up over 1994 by
approximately 8.2%, although North American new car and light truck sales volume
increased just over 2% in 1995. This improvement in sales volume was the result
of a marked increase in sales to other automotive accounts and, to a lesser
degree, improved sales to the Company's principal automotive wire customer. See
"Business--Product Lines--Automotive Wire". Other sales increased approximately
44.2%, attributable to the Brownell Acquisition.

Cost of goods sold increased 21.7% in 1995 compared with 1994 due primarily
to increased copper and other material costs and increased distribution costs
attributable to the Brownell Acquisition. The Company's cost of goods sold as a
percentage of net sales was 85.8% and 83.8% in 1995 and 1994, respectively. Cost
of goods sold as a percentage of net sales in 1995 was higher compared to 1994
due primarily to substantially higher copper prices and declining building wire
product pricing partially offset by lower manufacturing costs resulting from
continued capital investments and higher manufacturing volumes in the
communication and automotive business units.

Selling and administrative expenses in 1995 were 9.6% higher than 1994 due
primarily to increased overhead expenses attributable to the Brownell
Acquisition in the amount of approximately $5.1 million and to increased sales
commissions associated with higher sales.

Interest expense in 1995 was 18.5% lower than in 1994 due primarily to the
Redemption. The Company's average interest rate decreased from 12.6% in 1994 to
10.4% in 1995 due to the Redemption.

Income tax expense was 52.0% and 55.9% of pretax income in 1995 and 1994,
respectively. The effective income tax rate of the Company is higher than the
approximate statutory rate of 40.0% due to the effect of the amortization of
excess of cost over net assets acquired in the Acquisition, which is not
deductible for income tax purposes.

24
<PAGE>
The Company recorded net income of $10.3 and $7.5 million in 1995 and 1994,
respectively. The 1995 results include an extraordinary charge of $3.0 million
($5.0 million before applicable tax benefit) for the write-off of unamortized
debt issuance costs associated with the Company's former credit agreement which
was terminated in connection with the Redemption.

LIQUIDITY, CAPITAL RESOURCES AND FINANCIAL CONDITION

GENERAL

Essex International is a holding company with no operations and virtually no
assets other than its ownership of the outstanding common stock of Essex. All
such stock is pledged, however, to the lenders under the Essex Revolving Credit
Agreement. Accordingly, Essex International's ability to meet its cash
obligations is dependent on Essex's ability to pay dividends, to loan, or to
otherwise advance or transfer funds to Essex International in amounts sufficient
to service Essex International's cash obligations.

Essex International expects that it may receive certain cash payments from
Essex from time to time to the extent cash is available and to the extent it is
permitted under the terms of the Essex Revolving Credit Agreement and the Senior
Note Indenture. Such payments may include (i) an amount necessary under the tax
sharing agreement between Essex and Essex International to enable Essex
International to pay Essex' taxes as if computed on an unconsolidated basis;
(ii) an annual management fee to an affiliate of BHLP of up to $1.0 million;
(iii) amounts necessary to repurchase management stockholders' shares of Common
Stock under certain specified conditions; and (iv) certain other amounts to meet
ongoing expenses of Essex International (such amounts are considered to be
immaterial both individually and in the aggregate because Essex International
has no operations, other than those conducted through Essex, or employees). To
the extent Essex makes any such payments, it will do so out of operating cash
flow, borrowings under the Essex Revolving Credit Agreement or other sources of
funds it may obtain in the future subject to the terms of the Essex Revolving
Credit Agreement and the Essex Senior Note Indenture.

The Company's financial position at December 31, 1996, was highly leveraged.
The Company's aggregate notes payable to banks plus long-term debt was $463.8
million, and its stockholders' equity was $158.7 million. The resulting ratio of
debt to stockholders' equity improved to 2.9 to 1 at December 31, 1996, from 3.6
to 1 at December 31, 1995.

CREDIT FACILITIES AND LINES OF CREDIT

The Company maintains the following credit facilities: (i) a $370.0 million
revolving credit agreement dated as of October 31, 1996, by and among Essex,
Essex International, the Lenders named therein, and The Chase Manhattan Bank, as
administrative agent (the "Essex Revolving Credit Agreement"); (ii) a $60.0
million senior unsecured note agreement, dated as of April 12, 1995, by and
among Essex, Essex International, as guarantor, the Lenders named therein and
The Chase Manhattan Bank, as administrative agent (the "Essex Term Loan"); (iii)
a $25.0 million agreement and lease, dated as of April 12, 1995, by and between
Essex and Mellon Financial Services Corporation #3 (the "Essex Sale and
Leaseback Agreement"); (iv) a $12.0 million (Canadian dollar) credit agreement
by and between a subsidiary of Essex, and the Bank of Montreal (the "Canadian
Credit Agreement"); and (v) bank lines of credit with various lending banks that
provide for unsecured borrowings for working capital of up to $25.0 million.

The Essex Revolving Credit Agreement, entered into in connection with the
Triangle Acquisition, provides for up to $370.0 million in revolving loans,
subject to specified percentages of eligible assets and reduced by outstanding
borrowings under the Canadian Credit Agreement and unsecured bank lines of
credit. The Essex Revolving Credit Agreement also provides a $25.0 million
letter of credit subfacility. The Essex Revolving Credit Agreement terminates on
October 31, 2001. The Essex Revolving Credit Agreement loans bear floating rates
of interest, at the Company's option, at bank prime plus 1.25% or a reserve
adjusted LIBOR rate plus 2.25%. The effective interest rate can be reduced by
0.25%

25
<PAGE>
to 1.50%, in 0.25% increments, if certain specified financial conditions are
achieved. The average interest rate on borrowings under the Essex Revolving
Credit Agreement during the fourth quarter of 1996 was 7.16%. At December 31,
1996, the amount of revolving credit available to the Company was $61.7 million
based upon the Essex Revolving Credit Agreement borrowing base of $272.5
million, reduced by outstanding borrowings under (i) the Essex Revolving Credit
Agreement ($179.9 million), (ii) unsecured bank lines of credit ($25.0 million)
and (iii) the Canadian Credit Agreement ($5.9 million). During 1996, average
borrowings under the Company's revolving credit facilities were $163.4 million
compared to $92.1 million in 1995.

The $60.0 million borrowed under the Essex Term Loan is to be repaid in 20
equal quarterly installments, subject to the loan's excess cash provision,
beginning August 15, 1995, and ending May 15, 2000. The Essex Term Loan bears
floating rates of interest at bank prime plus 2.75% or LIBOR plus 3.75%. The
Essex Term Loan requires 50% of excess cash, as defined, to be applied against
the outstanding term loan balance. The 1996 excess cash repayment of $12.4
million, for the year ended December 31, 1995, resulted in reducing the
remaining principal payments to $2.3 million each. There were no requirements
for an excess cash payment to be made for 1996 results. Amounts repaid may not
be reborrowed.

The Essex Sale and Leaseback Agreement provided $25.0 million for the sale
and leaseback of certain of the Company's fixed assets. The lease obligation has
a seven-year term expiring in May 2002. The principal component of the rental is
paid quarterly, with the amount of each of the first 27 payments equal to 2.5%
of lessor's cost of the equipment, and the balance due at the final payment. The
interest component is paid on the unpaid principal balance and is calculated by
lessor at LIBOR plus 2.5%. The effective interest rate can be reduced by 0.25%
to 1.125% if certain specified financial conditions are achieved.

As of December 31, 1996, $5.9 million (US dollars) was outstanding under the
Canadian Credit Agreement and included as notes payable to banks in the
Company's financial statements. The Canadian Credit Agreement bears interest at
rates similar to the Essex Revolving Credit Agreement and terminates on May 30,
1997, although it may be extended for successive one-year periods upon the
mutual consent of the subsidiary and the lending bank.

The Company had $25 million outstanding under bank lines of credit as of
December 31, 1996. Such amount is included in notes payable to banks in the
Company's Consolidated Balance Sheets. These lines of credit bear interest at
rates subject to agreement between the Company and the lending banks. At
December 31, 1996, such rates of interest averaged 7.6%.

CASH FLOW AND WORKING CAPITAL

In general, the Company requires liquidity for working capital, capital
expenditures, debt repayments, interest and taxes. Of particular significance to
the Company are its working capital requirements that increase whenever it
experiences strong incremental demand in its business or a significant rise in
copper prices. Historically, the Company has satisfied its liquidity
requirements through a combination of funds generated from operating activities
together with funds available under its credit facilities. Based upon historical
experience and the availability of funds under its credit facilities, the
Company expects that its usual sources of liquidity will be sufficient to enable
it to meet its cash requirements for working capital, capital expenditures, debt
repayments, interest and taxes for the remainder of 1997.

OPERATING ACTIVITIES. Net cash provided by operating activities in 1996 was
$64.6 million, compared to $89.8 million in 1995. The decrease in cash provided
by operating activities was primarily attributable to an increase in inventories
to accommodate higher sales volumes, net of the Triangle Acquisition, and slower
growth in accounts payable partially offset by a reduction in accounts
receivable attributable to a marked decline in copper prices.

INVESTING ACTIVITIES. Capital expenditures of $25.6 million in 1996 were
$3.0 million less than in 1995. In 1996, approximately $5.5 million was invested
in magnet wire ovens to improve quality and

26
<PAGE>
increase manufacturing productivity. Capital expenditures in 1997 are expected
to be approximately 40% above 1996 levels and will be used for modernization
projects to enhance efficiency and expand capacity. At December 31, 1996,
approximately $5.5 million was committed to outside vendors for capital
expenditures. The Essex Revolving Credit Agreement imposes limitations on
capital expenditures, business acquisitions and investments. See "Description of
Certain Indebtedness--Essex Revolving Credit Agreement".

The costs of the BICC Canada and Triangle acquisitions, approximately $7.6
million and $71.8 million, respectively, including related expenses, were
financed from proceeds received under the Company's revolving credit agreements
applicable at the time. Future cash requirements of these operations are
expected to be satisfied through the Company's traditional sources of liquidity,
as previously discussed.

FINANCING ACTIVITIES. On July 15, 1996, the Company redeemed all its
outstanding 15% Series B Cumulative Redeemable Exchangeable Preferred Stock (the
"Series B Preferred Stock") at $27.041 per share, or $59.3 million in the
aggregate, including related redemption expenses. This was financed by the
Company through a private offering of 5,930,000 shares of Common Stock to
certain of its common stockholders and their affiliates at $10 per share. In
December 1996, the private offering (the "1996 Private Offering") was extended
to certain management employees of the Company, who collectively purchased
437,708.5 shares of Common Stock at $10 per share.

LONG-TERM LIQUIDITY CONSIDERATIONS

Regarding long-term liquidity, the Essex Senior Notes (as defined in
"Description of Certain Indebtedness) mature in 2003 and are expected to be
replaced by similar financing at that time. The terms of the Essex Sale and
Leaseback Agreement include a balloon payment of $8.1 million in 2002, and the
Essex Term Loan requires quarterly principal payments of $2.3 million through
May 2002. The Company expects that its traditional sources of liquidity will
enable it to meet its long-term cash requirements for working capital, capital
expenditures, interest and taxes, as well as its debt repayment obligations
under both the Essex Term Loan and the Essex Sale and Leaseback Agreement.

The Company's operations involve the use, disposal and cleanup of certain
substances regulated under environmental protection laws. The Company has
accrued $0.9 million for environmental remediation and restoration costs. The
accrual is based upon management's best estimate of the Company's exposure in
light of relevant available information, including the allocations and remedies
set forth in applicable consent decrees, third-party estimates of remediation
costs, the estimated ability of other potentially responsible parties to pay
their proportionate share of remediation costs, the nature of each site and the
number of participating parties. Subject to the difficulty in estimating future
environmental costs, the Company expects that any sum it may have to pay in
connection with environmental matters in excess of the amounts recorded or
disclosed will not have a material adverse effect on its financial position,
results of operations or cash flows. See "Business--Legal and Environmental
Matters" for further discussion of the Company's environmental liabilities.

DERIVATIVE FINANCIAL INSTRUMENTS

The Company, to a limited extent, uses forward fixed price contracts and
derivative financial instruments to manage foreign currency exchange and
commodity price risks. To protect the Company's anticipated cash flows from the
risk of adverse foreign currency exchange fluctuations for firm sales and
purchase commitments, the Company enters into foreign currency forward exchange
contracts. Copper, the Company's principal raw material, experiences marked
fluctuations in market prices, thereby subjecting the Company to copper price
risk with respect to copper purchases on fixed customer sales contracts.
Derivative financial instruments in the form of copper futures and forward
contracts are utilized by the Company to reduce those risks. The Company does
not hold or issue financial instruments for investment or trading purposes. The
Company is exposed to credit risk in the event of nonperformance by
counterparties to foreign exchange forward contracts, metal forward price
contracts and metals futures contracts, but the Company does not anticipate
nonperformance by any of these counterparties. The amount of such exposure is
generally the unrealized gains, if any, with respect to the underlying
contracts.

27
<PAGE>
BUSINESS

The Company is a leading North American developer, manufacturer and
distributor of copper electrical wire and cable products. Founded in 1930, the
Company serves over 11,000 worldwide customers in a wide range of industrial
markets from its 28 manufacturing facilities and 48 service centers located
throughout the United States and Canada. Since 1993, the Company has
significantly strengthened its market positions through expanded sales efforts
and acquisitions and has improved its manufacturing capacity and production
efficiencies through capital expenditure and productivity improvement programs.
As a result of these efforts, from 1993 to 1996, the Company's net sales volumes
grew at a CAGR of approximately 8%, generating $1.3 billion in net sales in
1996, while its EBITDA grew at a CAGR of 22%, from $77 million in 1993 to $140
million in 1996.

The Company organizes its operating activities into the following principal
areas:

MAGNET WIRE PRODUCTS (29% of 1996 net sales)--The Company's magnet wire
products are used in a wide variety of motors, coils, relays, generators,
solenoids and transformers by the electrical equipment and electronics
industries. Annual industry data since 1991 has shown that the Company's magnet
wire products have the highest quality in the industry (as measured by customer
returns). As a result of significantly increasing its sales volumes of magnet
wire products in recent years while focusing on higher value-added products and
controlling costs, the gross margins of the Company's magnet wire business have
increased substantially.

BUILDING WIRE AND CABLE PRODUCTS (37% of 1996 net sales)--The Company
produces a wide range of copper building wire and related wire products for the
commercial, industrial and residential markets. These products are marketed
primarily to electrical distributors throughout the United States and Canada for
ultimate use by electrical contractors and "do-it-yourself" consumers.
Approximately two-thirds of the Company's net sales of these products is
attributable to remodeling and repair activity and the balance to new
nonresidential and residential construction.

COMMUNICATIONS WIRE AND CABLE PRODUCTS (13% of 1996 net sales)--The
Company's communications wire products consist of OSP voice communication copper
wire and cable products for the "local loop" segment of the telecommunication
system and voice and data communication copper wire and cable products for the
premise segment of the telecommunication system. Copper-based wire is the most
widely used medium for voice and data transmission in the local loop and in
homes and offices, due in part to its significant installed base, lower
installation cost and ease of repair.

OTHER PRODUCTS AND ACTIVITIES (21% of 1996 net sales)--The Company
manufactures and markets a wide range of automotive and industrial electrical
wire products and maintains a distribution business for the sale and
distribution of its magnet wire and related third-party-manufactured products.
The Company produces automotive wire and cable products (7% of 1996 net sales)
for sale to suppliers of automotive original equipment. Such products include
primary wire for use in engine harnesses, ignition wire and battery cable.
Industrial wire and cable products (5% of 1996 net sales) consist of appliance
wire, motor lead wire, submersible pump cable, power cable, flexible cord, power
supply cords, welding cable and recreational vehicle wire. The Company's
distribution business provides a sales channel to both small manufacturers of
original equipment motors and motor repair markets for some of the Company's
magnet wire products, as well as third-party-manufactured products that
complement the Company's magnet wire products. During 1996, third-party products
constituted 9% of net sales, while 20% of the Company's magnet wire products
were sold through this sales channel.

28
<PAGE>
STRATEGY

The Company has established a strategy that is designed to exploit its
competitive strengths and position it to pursue opportunities for future growth.
The key tenets of this strategy are:

- CAPITALIZE ON SIZE AND SCOPE OF OPERATIONS--The Company is one of the
largest electrical wire producers in the United States. The Company
believes that the size and scope of its operations provide it with
efficiencies in manufacturing, purchasing and distribution and with the
resources necessary to meet the increasing technological demands of the
market. The Company intends to enhance these competitive advantages by
continuing to expand its operations through internal growth and
acquisitions. The electrical copper wire and cable industry in North
America has undergone significant consolidation in the past ten years as a
result of increased demand for product quality and lower cost products
that in turn has necessitated substantial capital spending and development
of sophisticated technical capabilities by market participants.

- ENHANCE STRONG MARKET POSITIONS--The Company is focusing on improving its
leading or significant market positions in North America for its major
product categories and capitalizing on the advantages of its size. The
Company is one of two leading producers in each of the magnet wire and
building wire markets. Recent acquisitions in magnet wire distribution,
building wire and industrial wire have enhanced the Company's market
positions in these businesses. The Company intends to maintain and enhance
its market positions through internal growth and continued participation
in future industry consolidation.

- MAINTAIN LEADERSHIP IN QUALITY AND PRODUCTIVITY--The Company employs
advanced technologies in manufacturing processes and product development
and intends to continue investing in manufacturing equipment and
facilities and to expand its continuous improvement programs in order to
maintain its leadership in quality and productivity. The Company believes
that its wire and cable products, which have earned numerous customer
quality awards, are among the highest in quality in the industry. Since
1992, the Company has invested approximately $140 million in capital
programs and has expanded its continuous improvement programs in order to
improve the quality of its products and increase the cost efficiency and
capacity of its production facilities. The Company also has lowered cost
levels by pursuing a high level of vertical integration through internal
production of its principal raw materials. In 1996, the Company produced
over 85% of its copper rod, magnet wire enamel and rubber insulation
materials and 70% of its PVC insulation requirements. As a result, the
Company believes that it is among the lowest cost domestic producers in
each of its business lines. A key productivity measure, annual copper
equivalent pounds shipped per employee, has increased by 21% from 1991 to
1996.

- CAPITALIZE ON INDUSTRY GROWTH OPPORTUNITIES--The Company believes that, as
the consumer continues to adapt to technological advances in both the home
and the workplace, the technical specifications of the "smart" home and
office will generate increased demand for certain electrical wire and
cable products. The Company believes that it is well positioned to
capitalize on this growth due to its significant market positions, strong
name recognition and size. Growth in the magnet wire business is expected
to be driven by increasing demand for devices containing electric motors
in the home and in automobiles, along with continuing consumer and
government pressure for higher energy efficiency from these devices
(energy efficient motors utilize materially more magnet wire per unit than
do their traditional counterparts). Growth in the building wire business
is expected to come primarily from increasing repair and remodeling
activity, as well as from new residential, commercial and industrial
construction. Both new construction and remodeling activity is being
affected by the increased number of circuits and amperage handling
capacity needed to support the increasing demand for electrical services.
The Company believes that its communications wire and cable business will
benefit from the increasing number of outside telephone lines into and
inside homes and offices and the increasing quality demands placed on
these lines to facilitate escalating data transmission from the growing
number of

29
<PAGE>
computers, facsimile machines and Internet devices. In the automotive
business, the Company believes that the increasing production of cars and
trucks with motorized or electrical options will translate into increased
demand for higher quality, thinner-gauge wire products to take advantage
of their lighter weights and greater efficiency.

- PURSUE ACQUISITION OPPORTUNITIES-- Consistent with its historical emphasis
on vertical integration, breadth of product line and technological
innovation, the Company continuously evaluates opportunities to benefit
further from its manufacturing, purchasing and distribution capabilities,
expand its customer base, reduce costs and enter new markets through
acquisitions, investments, joint ventures and other strategic alliances.
Since the 1995 Refinancing, which provided the Company with substantial
financial and operating flexibility, the Company has acquired three major
businesses: the distribution business of Brownell; the Canadian building
wire business of BICC Canada in March 1996; and the building and
industrial wire businesses of Triangle in October 1996. The Company
believes that each of these businesses provides operating synergy which
complements the Company's existing manufacturing, distribution and
administrative capabilities, and each has met or exceeded financial and
operating expectations since its respective acquisition date. In addition,
in May 1995, the Company entered into a joint venture in India with
Finolex Cable LTD for the development and production of copper rod and
other wire products for the domestic Indian market and recently
established a joint venture with Raychem Corp. for the production and sale
of high performance wire products for the automotive industry. The Company
is currently evaluating several acquisition opportunities consistent with
its business strategy, although it has not reached agreement with any
third parties at this time.

- EXPAND INTERNATIONAL BUSINESS--Historically, the Company's production and
distribution emphasis has focused on North America, primarily the U.S.
market. Management anticipates that while the Company will remain focused
on the U.S. market, it expects to increase its efforts in expanding its
customer base in Canada and Mexico, where the Company believes demand for
electrical wire and cable products will grow significantly over the next
few years. Management also expects to establish a preliminary presence in
certain developing economies, particularly in locations that have been
targeted by the Company's customers for their own expansion.

MANAGEMENT AND COMPANY HISTORY

The Company's senior management team, including its business unit managers,
possesses a high level of experience in the wire and cable industry. The eight
most senior officers average 21 years of related industry experience, with an
average of over 17 years with the Company. The equity interest of management and
present and former employees (15.7% on a fully diluted basis ([ ]% after giving
effect to the Offerings)) in the Company helps ensure that the interests of
management are aligned with those of the Company's other stockholders.

The Company was founded in 1930. From 1974 until February 1988 it was
operated as a wholly owned subsidiary of United Technologies Corporation
("UTC"). On February 29, 1988, the Company was purchased from UTC by The Morgan
Stanley Leveraged Equity Fund II, L.P., certain directors and members of
management of the Company and others (the "1988 Acquisition"). In October 1992,
the Company was acquired in the Acquisition by the existing stockholders. The
existing stockholders of the Company and their equity interests on a fully
diluted basis are BH Group (58.9%), certain present and former employees
(15.7%), the GS Partnerships (12.4%), DLJ (9.2%) and CEA (3.7%). After giving
effect to the Offerings, BH Group, present and former employees, the GS
Partnerships, DLJ and CEA will beneficially own [ ]%, [ ]%, [ ]%, [ ]% and [ ]%,
respectively, of the outstanding shares of Common Stock. In connection with the
Acquisition, the GS Partnerships and DLJ were granted Warrants to purchase up to
1,120,551.5 and 1,712,817.5 shares of Common Stock, respectively, at an exercise
price of $5.71514 per share. It is anticipated that none of the Warrants will be
outstanding after the Offerings.

30
<PAGE>
PRODUCT LINES

The following table sets forth for each of the years in the three-year
period ended December 31, 1996, the dollar amounts and percentages of sales of
each of the Company's major product lines:

<TABLE>
<CAPTION>
(DOLLARS IN MILLIONS, EXCEPT FOR COPPER PRICE)
----------------------------------------------------------------
1994 (a) 1995 (a) 1996
-------------------- -------------------- --------------------
<S> <C> <C> <C> <C> <C> <C>
Magnet wire............................. $ 306.9 30% $ 388.2 32% $ 388.8 29%
Building wire........................... 390.0 39 406.1 34 487.1 37
Communication wire...................... 119.3 12 177.5 15 166.8 13
Automotive wire......................... 82.8 8 97.3 8 91.2 7
Industrial wire......................... 63.1 6 63.4 5 71.0 5
Other(b)................................ 48.0 5 69.2 6 127.1 9
--------- --- --------- --- --------- ---
Total................................... $ 1,010.1 100% $ 1,201.7 100% $ 1,332.0 100%
--------- --- --------- --- --------- ---
--------- --- --------- --- --------- ---
Average COMEX copper price per pound.... $ 1.07 $ 1.35 $ 1.06
</TABLE>

- ------------------------

(a) Due to a reorganization in the third quarter 1995, certain 1994 and 1995
product line sales have been reclassified.

The Company classifies its operations into business units based on the
markets served. An overview of each business unit and the product lines
contained therein is set forth below.

MAGNET WIRE

INDUSTRY. The independent domestic supply of magnet wire has experienced
continued growth since 1990 and was, by Company estimates, approximately 790
million copper equivalent pounds sold in 1996. Growth in the magnet wire
business is being driven by the increasing demand for electrical devices
containing motors for the home and automobile, along with continuing consumer
and government pressure for higher energy efficiency from these devices (energy
efficient motors utilize materially more magnet wire per unit than traditional
counterparts). Strong consumer demand for greater numbers of electrical
convenience items in homes, offices and vehicles has resulted in increased sales
of household appliances and increased use of electric motors in vehicles.

Due to the substantial capital costs associated with magnet wire production,
the importance to original equipment manufacturers of a reputation for quality
and the stringent technological requirements and the cost efficiencies achieved
by larger magnet wire producers, significant industry consolidation has occurred
during the past ten years. In addition, the percentage of U.S. magnet wire
produced by independent magnet wire manufacturers such as the Company has grown
as the manufacturing capacity of captive magnet wire producers (electrical
equipment manufacturers who internally produce their own magnet wire) has been
reduced as a result of outsourcing over the last several years. Consequently, as
a result of the Company's efforts to maintain and enhance its manufacturing
capabilities, product development efforts and cost efficiencies through capital
spending and its continuous improvement programs, the Company has positioned
itself as one of the two leading independent domestic producers of magnet wire.

PRODUCTS. The Company's magnet wire business unit offers a comprehensive
product line, including over 500 types of magnet wire used in a wide variety of
electromagnetic devices, such as motors,

31
<PAGE>
transformers, control devices, relays, generators and solenoids, for household
and automotive applications. Household products requiring magnet wire include
major appliances (dishwashers, dryers, refrigerators and washing machines),
small kitchen appliances (blenders, can openers and mixers), lawn tools (hedge
trimmers, lawn mowers and power tools) and other products such as air
conditioning units, humidifiers, security systems, overhead lighting and
pole/pad distribution transformers. Automotive products requiring magnet wire
include alternators, anti-lock braking systems, dashboard gauges, wiper motors
and power controls (antenna, seat, steering and windows).

The Company has received ISO 9001 and 9002 and QS9000 certification at all
its magnet wire manufacturing facilities.

SALES AND DISTRIBUTION. The Company's magnet wire products are sold to
original equipment manufacturers, motor repair shops, coil manufacturers and
independent distributors. Products are marketed nationally through a direct
sales force and the Company's distribution business unit. In 1996, approximately
three-fourths of the Company's magnet wire sales were made directly to end users
and approximately one-fourth were made through distributors.

BUILDING WIRE

INDUSTRY. The Company estimates that the domestic building wire market was
approximately 1.3 billion copper equivalent pounds sold in 1996. Increased
industry sales volume in recent years has resulted primarily from the level of
repair and remodel activity, as well as new nonresidential and residential
construction. For 1996, approximately two-thirds of industry sales volume was
attributable to repair and remodel activity and one-third to new construction.
Demand is also influenced by growth in electrical needs.

The building wire industry has experienced significant consolidation in
recent years, declining from approximately 28 manufacturers in 1980 to seven
primary manufacturers in 1996. The Company believes this consolidation is due
primarily to cost efficiencies achieved by the larger building wire producers as
they capitalize on the benefits of vertical integration and of manufacturing,
purchasing and distribution economies of scale. The Company has been an active
participant in this industry consolidation with the purchase of the Canadian
assets of BICC Canada in 1996 and the Triangle Acquisition in 1996. See
"--Recent Acquisitions". The Company believes that it is one of the two leading
domestic manufacturers of building wire.

PRODUCTS. The Company's building wire business unit, which began
manufacturing building wire in 1933, develops, manufactures and markets a
complete line of building wire. These products include a wide variety of
thermoplastic and thermoset insulated wires for the commercial and industrial
building markets and service entrance cable, underground feeder wire and
nonmetallic jacketed wire and cable for the residential market.

SALES AND DISTRIBUTION. The Company sells its building wire products
nationally through a direct sales force and a large network of manufacturers
representatives to a large and diverse customer base, consisting primarily of
electrical distributors and consumer product retailers. The Company maintains
numerous stocking locations across the United States and Canada to facilitate
distributors' "just-in-time" inventory practices. The ultimate end users of the
Company's building wire products are electrical contractors and "do-it-yourself"
consumers.

COMMUNICATION WIRE

INDUSTRY. The Company focuses on two segments of the communication wire
market: (i) outside plant ("OSP") wire and cable for voice communication in the
local loop segment of telephone networks and (ii) premise wire and cable for
voice and data communication in homes and offices for local area computer
networks ("LANs") and other applications. The Company believes that the domestic
copper

32
<PAGE>
OSP market was approximately $0.6 billion in 1996 and that the domestic copper
premise wire market was approximately $1.1 billion in 1996.

The local loop segment of the telecommunication network connects homes and
offices to the nearest telephone company switch or central office. Although
other transmission media, such as fiber optic cable, are extensively used for
long distance and trunk lines, copper wire and cable, with its lower
installation cost and ease of repair, is the most widely used medium for
transmission in the local loop, which comprises approximately 160 million
residential and business access lines across the United States. As a result of
consolidation in the OSP copper wire industry, total industry capacity has been
reduced and the number of manufacturers has declined. Demand for OSP wire in the
local loop should benefit from the increasing demand for multiple residential
access lines, as more households install additional access lines for multiple
telephone lines, facsimile machines, access to the Internet and for home
offices.

Premise wire is used within buildings to connect telecommunication devices
(telephones, facsimile machines and computer modems) to the telecommunications
network and to establish LANs. Rapid technological advances in communication and
computer systems have created increasing demand for greater bandwidth
capabilities in data transmission cable products. The Company expects demand for
enhanced premise wire products to increase significantly in the future,
particularly as office buildings are upgraded to accommodate advanced network
requirements. In addition, the Company believes that increasing demand for
multiple residential access lines will increase demand for premise wire. The
demand for product quality and the rapid pace of technological change have
necessitated significant capital investments by manufacturers.

PRODUCTS. Although the Company continues to have a strong presence in the
OSP market, it has begun to shift its focus to the premise wire market, which
provides potentially greater growth opportunities than the OSP market. Sales
volumes of the Company's premise wire products have grown at a CAGR of 50% since
1992. The Company is developing new products in the OSP segment, such as broad
band "extra terrestrial" OSP cable to support new technologies, and in the
premise segment, such as enhanced category five wire for high-speed LAN
applications.

SALES AND DISTRIBUTION. While a significant amount of OSP wire has
historically been sold directly to domestic telephone companies, recently the
Company has focused its sales of both OSP and premise wire to domestic and
international distributors and representatives who in turn resell to
contractors, international and domestic telephone companies and private overseas
contractors for installation in the industrial, commercial and residential
markets.

AUTOMOTIVE WIRE

INDUSTRY. The automotive primary wire market has experienced strong growth
over the last decade due to higher production levels of new vehicles and the
significant increase in the installation of electrical options in vehicles,
which deliver increased safety, convenience and engine performance to the
consumer. These electrical options include power windows, supplemental restraint
systems, digital displays, keyless entry, traction control, electronic
suspension and anti-lock brakes. According to the Copper Development
Association, the total content of copper wire per vehicle has grown from
approximately 10 pounds in 1982 to approximately 24 pounds in 1992 and is
expected to grow to approximately 27 pounds by 1998.

The increasing demand for copper wire content in vehicles has created strong
demand for thinner-gauge wire, which in turn requires significant manufacturing
sophistication. The Company and its major competitors also face stringent
demands by automotive manufacturers to improve cost efficiency. These factors
have resulted in higher levels of capital investment and stable product pricing,
as well as industry consolidation.

33
<PAGE>
PRODUCTS. The Company's automotive wire products include primary wire for
use in engine harnesses, ignition wire, battery cable and specialty wiring
assemblies. Through a joint venture with Raychem Corp., the Company has begun to
market a high-temperature resistant, thinner-gauge automotive wire designed to
meet future specialized needs of the automotive industry.

SALES AND DISTRIBUTION. The Company sells automotive wire products
primarily to tier one motor vehicle manufacturer suppliers. The Company has
diversified its customer base for automotive wire products through steadily
improving product quality and increased productivity achieved through process
improvements.

Historically, the automotive division of UTC ("UTA") has been the principal
customer for the unit's automotive products, although sales to UTA have declined
in relative terms due to the expansion of the unit's overall customer base. UTA
accounted for approximately 50%, 48% and 40% of the Company's automotive wire
revenues in 1994, 1995 and 1996, respectively. Currently, the Company is in the
midst of a three-year contract with UTA, which expires in October 1997. The
Company and UTA are currently discussing an extension of this contract. Although
the Company expects to be able to extend this contract on reasonable terms, no
assurance can be given that this contract will be extended or, if extended that
it will be on the same terms as the current contract. The loss of UTA as a
customer could materially and adversely affect the Company's automotive wire
business unit.

INDUSTRIAL WIRE

INDUSTRY. The domestic industrial wire market is estimated by the Company
to be approximately $1.0 billion. Significant factors influencing the growth of
this industry include the construction or expansion of manufacturing plants,
mine expansion and consumer spending for hard goods. Due to the diversity of
product offerings within this industry, the Company's competition is fragmented
across the product lines and markets served by the industrial wire business
unit. The Company's acquisition of Triangle continues the recent industry trend
toward consolidation. See "--Recent Acquisitions".

PRODUCTS. The Company's industrial wire business unit develops,
manufactures and markets a broad line of industrial wire and cable products,
including appliance wire, motor lead wire, submersible pump cable, power cable,
bulk flexible cord, power supply cord sets, welding cable and recreational
vehicle wire.

SALES AND DISTRIBUTION. The Company sells industrial wire and cable
products on a nationwide basis, primarily to appliance and power tool
manufacturers, suppliers of electrical and electronic original equipment
manufacturers, electrical distributors and welding products distributors.
Distribution is done by a Company sales force and a large network of
manufacturers representatives.

RECENT ACQUISITIONS

The 1995 Refinancing provided the Company with additional financial
flexibility to pursue an active acquisition strategy. Consequently, the Company
has recently acquired several businesses to consolidate its market position in
its core products and realize further benefits from the Company's extensive
manufacturing and distribution capabilities.

In March 1996, the Company acquired the Canadian building and industrial
wire business of BICC Canada. This acquisition increased the Company's presence
in Canada and expanded its building wire product line.

The Brownell Acquisition in 1995 significantly increased the Company's
distribution business, particularly of magnet wire. Brownell had previously
served markets similar to the Company's existing magnet wire distribution
operations, but had purchased all of its products from third party suppliers.
The acquired assets were absorbed into an existing distribution unit now known
as "Essex Brownell". Products sold through Essex Brownell include magnet wire
and other products manufactured by the Company and items purchased from
third-party manufacturers, including electrical motors, electrical insulation
products, motor repair parts and pump seals. Of particular significance, Essex
Brownell provides the Company with an expanded sales channel to small original
equipment motor manufacturers and the motor repair markets.

34
<PAGE>
The Triangle Acquisition, completed in October 1996, was the most
significant acquisition in the Company's history. As a result, the Company
increased the size of its building and industrial wire business units, added
manufacturing capacity and broadened the Company's product offerings. The
Company has realized cost savings through the elimination of duplicative
selling, general and administrative expenses and through purchasing economies of
scale. The Company also plans to further improve manufacturing efficiencies by
increasing the product focus of certain manufacturing facilities. The
integration of the Triangle manufacturing facilities has proceeded smoothly and
the contribution to the Company's revenues and net income has exceeded the
Company's expectations.

MANUFACTURING PROCESS

Copper rod is the base component for most of the Company's wire products.
The Company buys copper cathode from a variety of producers and dealers and also
reclaims and reprocesses high grade scrap copper from its own operations and
those of other copper wire producers. After the rod is manufactured at the
Company's continuous casting facilities, it is shipped to Company manufacturing
facilities where it is processed into the wire and cable products produced and
sold by the Company. See "--Metals Operations" for a discussion of the Company's
copper rod production.

The manufacturing processes for all the Company's wire and cable products
require that the copper rod be drawn and insulated. Certain products also
require that the drawn copper wire be "bunched" or "cabled" prior to being
insulated.

WIRE DRAWING. Wire drawing is the process of reducing the metal conductor
diameter by pulling it through a converging die until the specified product size
is attained. Since the reduction is limited by the breaking strength of the
metal conductor, this operation is repeated several times internally within the
machine. As the wire becomes smaller, less pulling force is required. Therefore,
machines operating in specific size ranges are required. Take-up containers or
spools are generally large, allowing one person to operate several machines.

BUNCHING. Bunching is the process of twisting together single wire strands
to form a concentric construction ranging from seven to over 200 strands. The
major purpose of bunching is to provide improved flexibility while maintaining
current carrying capacity.

CABLING. Cabling is the process of twisting individual bunched conductors
to form a conductor core. Cabling allows for the production of a very flexible
conductor which is useful in the production of larger products such as welding
cable, battery cable and mining cable. Cabling can also twist together insulated
conductors to form a multi-conductor product.

INSULATING. The magnet wire insulating materials (enamels) that are
manufactured by the Company's chemical processing facility are polymeric
materials produced by one of two methods. One method involves the blending of
commercial resins that are dissolved in various solvents and then modified with
catalysts, pigments, cross-linking agents and dyes. The other method involves
synthesizing polymer resins to desired molecular weights in reactor systems and
blending these polymers with solvent, catalysts and additives to form enamels.

The enamelling process used in the manufacture of some magnet wire involves
applying several thin coats of liquid enamel and evaporating the solvent in
baking chambers. Some enamels require a specific chemical reaction in the baking
chamber to fully cure the film. Enamels are generally applied to the wires in
excess and are then metered off with dies or rollers; other applications apply
only the required amount of liquid enamel.

Most other wire products are insulated and jacketed with either
thermoplastic or thermoset compounds that are applied to the metal conductor
through an extrusion process. Extrusion involves the feeding, melting and
pumping of a compound through a die to shape it into final form as it is applied
to

35
<PAGE>
the wire. The Company has the capability to manufacture both types of jacketing
and insulating compounds.

Once the wire is fabricated, it is packaged and shipped to regional service
centers, stocking agents or directly to customers.

METALS OPERATIONS

Copper is the primary component of the Company's overall cost structure,
comprising approximately 54% of the Company's 1996 total cost of goods sold. Due
to the critical nature of copper to its business, the Company has centrally
organized its metals operations. Through centralization, the Company carefully
manages its copper procurement, internal distribution, manufacturing and scrap
recycling processes.

The Company's metals operations are vertically integrated in the production
of copper rod. The Company believes that only a few of its competitors are able
to match this capability. The Company manufactures most of its copper rod
requirements and purchases the remainder from various suppliers.

COPPER PROCUREMENT. The Company's copper procurement activities are
centralized. In 1996, the Company purchased approximately 285,000 tons of
copper, entirely from North American copper producers and metals merchants.

To ensure a steady supply of copper, the Company contracts with copper
producers and metals merchants. Most contracts have a one-year term. Pricing
provisions vary, but are normally based on the COMEX price, plus a premium.
Premiums cover transportation and payment terms. Additionally, the Company
utilizes COMEX fixed price futures contracts to manage its commodity price risk.
The Company does not hold or issue such contracts for trading purposes.

Historically, the Company has had adequate supplies of copper available to
it from producers and merchants, both foreign and domestic. Competition from
other users of copper has not affected the Company's ability to meet its copper
procurement requirements. However, no assurance can be given that the Company
will be able to procure adequate supplies of copper to meet its future needs.

COPPER ROD PRODUCTION. The production of copper rod is an essential part of
the Company's manufacturing process and strategy. By manufacturing its own rod,
the Company is able to maintain greater control over the cost and quality of
this critical raw material.

Copper rod is manufactured in a continuous casting process in which high
quality copper cathodes are melted in a shaft furnace. The resultant molten
copper is transferred to a holding furnace and then transferred directly onto a
casting wheel, where it is cooled and subsequently rolled into copper rod. The
rod is subjected to numerous quality control tests to assure that it meets the
high quality standards of the Company's products. Finally, the rod is packaged
for shipment via an automatic in-line coiling and packaging device.

The Company's rod production facilities are strategically located near its
major wire producing plants to minimize freight costs. From its five continuous
casting units, the Company has the capability to produce approximately 85% of
its rod requirements, while purchasing the balance from external sources.
External rod purchases are used to cover rod requirements at manufacturing
locations where shipping the Company-produced rod is not cost effective and when
the Company's rod requirements exceed its production capacity.

COPPER SCRAP RECLAMATION. The Company's Metals Processing Center receives
clean, high quality copper scrap from the Company's magnet wire plants. Copper
scrap is processed in rotary furnaces, which also have refining capability to
remove impurities. The Company uses a continuous casting process to convert
scrap material directly into copper rod. Manufacturing cost economies,
particularly in

36
<PAGE>
the form of energy savings, result from this direct conversion technique.
Additionally, management believes that internal reclamation of scrap copper
provides greater control over the cost to recover the Company's principal
manufacturing by-product. The Company also, from time to time, obtains magnet
wire scrap from other copper wire producers and processes it along with the
internally generated scrap.

EXPORTS

Sales of exported goods approximated $52.7 million, $55.5 million and $85.8
million for the years ended December 31, 1994, 1995 and 1996, respectively.
Building wire, magnet wire and communication cables are the Company's primary
exports. Canada and Mexico are the primary export destinations.

BACKLOG; RETURNS

The Company has no significant order backlog, because it follows the
industry practice of producing its products on an ongoing basis to meet customer
demand without significant delay. The Company believes that the ability to
supply orders in a timely fashion is a competitive factor in the markets in
which it operates. Historically, returns have had no material adverse effect on
the Company's results of operations.

COMPETITION

In each of the Company's businesses, the Company experiences competition
from at least one major competitor. However, due to the diversity of the
Company's product lines as a whole, no single competitor competes with the
Company across the entire spectrum of the Company's product lines. Thus, the
Company's diversity of products and diversity of end users insulate it from
adverse conditions in any one business unit or any one product line. Many of the
Company's competitors do not have such diversity.

As a result of consolidation in the magnet wire industry, the Company
estimates that the three largest independent magnet wire producers represented
over 85% of copper equivalent pounds shipped in 1996. The building wire industry
also has experienced significant consolidation, from approximately 28
manufacturers in 1980 to approximately seven in 1996. The Company has been an
active participant in this industry consolidation with the purchase of the
Canadian building wire assets of BICC Canada and the Triangle Acquisition in
1996. The Company believes that it is one of the two largest domestic
manufacturers of magnet wire and building wire.

Many of the Company's products are made to industry specifications, and are
therefore essentially fungible with those of competitors. Accordingly, in these
markets the Company is subject to competition on the basis of price, delivery
time, customer service and its ability to meet specialty needs. The Company
believes that it enjoys strong customer relations resulting from its long
participation in the industry, its emphasis on customer service, its commitment
to quality control, its reliability and its substantial production resources.
The Company's distribution networks enable it to compete effectively with
respect to delivery time. From time to time the Company has experienced reduced
margins in certain markets due to unfavorable market conditions. During 1995 and
the first half of 1996, building wire product pricing (without regard to copper
costs) declined materially, and sales volumes also declined, although to a
lesser extent, due to competitive pricing pressures, excess capacity and
liquidation of inventories by distributors as a result of the significant
increase in copper prices in 1995 and early 1996. The communication wire
business unit also experienced reduced margins in 1994. Expected decreases in
the domestic OSP copper wire market demand may lead to reduced margins in the
communication wire business over the next few years.

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<PAGE>
ENVIRONMENTAL COMPLIANCE

The Company does not believe that compliance with environmental laws and
regulations will have a material effect on the level of capital expenditures of
the Company or its business, financial condition, cash flows or results of
operations. The Company does not currently anticipate material capital
expenditures for environmental control facilities. No material expenditures
relating to these matters were made in 1994, 1995 or 1996. In connection with
the 1988 Acquisition and associated stock purchase agreement with UTC dated
January 15, 1988, UTC indemnified the Company with respect to certain
environmental liabilities. See "--Legal and Environmental Matters."

EMPLOYEES

As of December 31, 1996, the Company employed approximately 1,700 salaried
and 3,100 hourly employees in 35 states. Labor unions represent approximately
49% of the Company's work force. Collective bargaining agreements expire at
various times between 1997 and 2000. Contracts covering approximately one-third
of the Company's unionized work force will expire at various times during 1997.
The Company believes that it will be able to renegotiate its contracts covering
such unionized employees on terms that will not be materially adverse to it.
However, no assurance can be given to that effect. The Company believes that its
relations with both unionized and nonunionized employees have been satisfactory.

PROPERTIES

At December 31, 1996 the Company operated 28 manufacturing facilities in 16
states. Except as indicated below, all of the facilities are owned by the
Company, subject to certain liens granted to the lenders pursuant to the Essex
Revolving Credit Agreement. The Company believes that its facilities and
equipment are reasonably suited to its needs and are properly maintained and
adequately insured.

38
<PAGE>
The following table sets forth certain information with respect to the
manufacturing facilities of the Company at December 31, 1996:

<TABLE>
<CAPTION>
SQUARE
OPERATION LOCATION FEET
- -------------------------------------------- --------------------- -------------
<S> <C> <C> <C>
Magnet Wire................................. Charlotte, NC 26,000 (Leased)
Fort Wayne, IN 181,000
Franklin, IN 35,000(a)
Franklin, TN 289,000 (Leased)
Kendallville, IN 88,000
Rockford, IL 319,000
Vincennes, IN 267,000
Building Wire............................... Anaheim, CA 174,000
Columbia City, IN 400,000
Lithonia, GA 144,000
Pauline, KS 501,000
Sikeston, MO 189,000
Tiffin, OH 260,000
Communication Wire.......................... Chester, SC 218,000
Hoisington, KS 239,000
Automotive Wire............................. Kosciusko, MS 90,000(b)
Marion, IN 50,000
Orleans, IN 425,000
Industrial Wire............................. Florence, AL 129,000
Lafayette, IN 350,000
Pana, IL 110,000
Pawtucket, RI 412,000
Phoenix, AZ 34,000
Insulation.................................. Newmarket, NH 132,000
(2 facilities)
Rutland, VT 61,000
Metals Processing........................... Columbia City, IN 75,000
Jonesboro, IN 56,000
</TABLE>

- ------------------------

(a) The total square footage of the Franklin, IN, facility is approximately
70,000, of which 35,000 square feet is leased to Femco (as described below).

(b) Approximately 30,000 square feet is leased.

In addition to the facilities described in the table above, the Company owns
or leases 48 service centers throughout the United States and Canada to
facilitate the sale and distribution of its products. The Company owns and
maintains executive and administrative offices in Fort Wayne, Indiana.

The Company believes that its plants are generally adequate to service the
requirements of its customers. Overall, the Company's plants are substantially
utilized. The extent of current utilization is generally consistent with
historical patterns, and, in the view of management, is satisfactory. The
Company does not view any of its plants as being underutilized, except for
Lafayette, Indiana, which just completed a major capacity expansion to make it
the focus plant for industrial wire products. Most plants operate on 24
hour-a-day schedules, on either a five day or seven day per week basis. During
1996, the Company's facilities operated in excess of 90% capacity.

The property in Franklin, Indiana, is a magnet wire manufacturing facility
occupied by both the Company and a joint venture ("Femco") between the Company
and the Furukawa Electric Company, LTD., Tokyo, Japan. Half of the Franklin,
Indiana, building is leased to Femco, which manufactures and

39
<PAGE>
markets magnet wire with special emphasis on products required by Japanese
manufacturers with production facilities in the United States.

LEGAL AND ENVIRONMENTAL MATTERS

The Company is engaged in certain routine litigation arising in the ordinary
course of business. While the outcome of litigation can never be predicted with
certainty, the Company does not believe that any of its existing litigation,
either individually or in the aggregate, will have a material adverse effect
upon its business, financial condition, cash flows or results of operations.

The Company's operations are subject to environmental laws and regulations
in each of the jurisdictions in which it operates governing, among other things,
emissions into the air, discharges to waters, the use, handling and disposal of
hazardous substances and the investigation and remediation of soil and
groundwater contamination, both on-site at Company facilities and at off-site
disposal locations. On-site contamination at certain Company facilities is the
result of historic disposal activities, including activities attributable to
Company operations and those occurring prior to the use of a facility by the
Company. Off-site liability includes clean-up responsibilities at various sites,
to be remedied under federal or state statutes, for which the Company has been
identified by the United States Environmental Protection Agency (the "EPA") (or
the equivalent state agency) as a Potentially Responsible Party ("PRP"). Certain
environmental laws have been construed to impose liability for the entire cost
of remediation at a site upon a PRP without regard to fault or the lawfulness of
the disposal activity.

Once the Company has been named as a PRP, it estimates the extent of its
potential liability based upon its past experience with similar sites and a
number of factors, including, among other things, the number and financial
viability of other identified PRPs, the total anticipated cost of the
remediation and the relative contribution by the Company, in volume and type, of
waste at the site. Most of the sites for which the Company is currently named as
a PRP are covered by an indemnity (the "general indemnity") from UTC that was
granted in connection with the 1988 Acquisition. Pursuant to the general
indemnity, UTC agreed to indemnify the Company against losses incurred under any
environmental protection and pollution control laws or resulting from or in
connection with damage or pollution to the environment arising from events,
operations or activities of the Company prior to February 29, 1988, or from
conditions or circumstances existing at or prior to February 29, 1988. In order
to be covered by the general indemnity, the condition, event, and circumstance
must have been known to UTC prior to February 29, 1988. The sites covered by the
general indemnity are handled directly by UTC, and all payments required to be
made are paid directly by UTC. These sites are all mature sites where
allocations have been settled and remediation is well underway or has been
completed. The Company is not aware of any inability or refusal on the part of
UTC to pay amounts that are owing under the general indemnity or any disputes
between the Company and UTC concerning matters covered by the general indemnity.

UTC also provided an additional environmental indemnity, referred to as the
"basket indemnity". This indemnity relates to liabilities arising from
environmental events, conditions or circumstances existing at or prior to
February 29, 1988, that only became known to UTC in the five-year period
commencing February 29, 1988. As to such liabilities, the Company is responsible
for the first $4.0 million incurred. Thereafter, UTC has agreed to indemnify the
Company fully for any liabilities in excess of $4.0 million. The Company is
currently named as a PRP at three sites which meet the criteria for the basket
indemnity. Those sites are Fisher Calo Chemical and Solvents Corporation,
Kingsbury, IN ("Fisher Calo"); Organic Chemicals, Inc., Grandville, MI; and USS
Lead Refinery Inc., East Chicago, IL. Based on records showing very small
quantities of material shipped to Organic Chemicals Inc. and USS Lead Refinery
Inc., the Company has determined that its liability, if any, for these sites
will be de minimis. At Fisher Calo, the Company entered into a consent decree
that defined its share as 0.25% and established an expected liability of $0.1
million, which has been accrued. Expenses at these three sites, up to $4.0
million, will be incurred by the Company rather than UTC, as the basket has not
been exhausted under the basket indemnity.

40
<PAGE>
In addition, there are five sites where the Company is either named as a PRP
or a defendant in a civil lawsuit which are not covered by the general indemnity
or the basket indemnity. They are Ascon Landfill, Huntington Beach, CA; A-1
Disposal Corp., Allegan County, MI; Angola Soya Co., Angola, IN; Milford Mill,
Beaver County, UT; and Uniontown Landfill, Uniontown, IN. Ascon Landfill was an
oil percolation refining center. The Company received a request for information
from the California Department of Toxic Substance Control in 1994 and replied
that it has no records linking the Company to the site. A-1 Disposal Corp.
stored and treated hazardous waste. The Company was one of a number of PRPs who
entered into a consent decree with the Michigan Department of Natural Resources
to clean the site. The Company has paid its assessment for the remediation.
Although the shares and sources of funding for five-year monitoring expenses
have not been established, the Company believes that its share will be minimal.
Angola Soya was a solvent reclamation facility in the 1950s and 1960s. After
receiving notice in 1994 alleging that its spent solvent drums had been
identified at the site, the Company cooperated with the Indiana Department of
Environmental Management to conduct a limited removal of certain of these drums.
No further activity by the Company is expected to be required there. The Milford
Mill site was a copper mill used by the Company in the early 1970s. The Company
is one of four PRPs notified by the EPA. The EPA conducted a removal action at
the site and incurred $0.2 million in costs, for which it is currently seeking
reimbursement from the PRPs. The Uniontown Landfill is the subject of a civil
lawsuit in which the Company is one of several defendants sued by the owner of
the landfill to recover alleged site investigation and groundwater remediation
costs. The Company does not believe that it is responsible for any disposal at
this site and is vigorously defending itself. The Company has provided a reserve
in the amount of $0.9 million to cover contingencies associated with these five
sites. This accrual is based on management's best estimate of the Company's
exposure in light of relevant available information, including the allocations
and remedies set forth in applicable consent degrees, third party estimates of
remediation costs, actual remediation costs incurred, the probable ability of
other PRPs to pay their proportionate share of remediation costs, the conditions
at each site and the number of participating parties. The Company currently does
not believe that any of the environmental proceedings in which it is involved
and for which it may be liable will individually or in the aggregate have a
material adverse effect upon its business, financial condition, cash flows or
results of operations. There can be no assurance that future developments will
not alter this conclusion. None of the cases described above involves sanctions,
fines or administrative penalties against the Company.

Since approximately 1990, the Company has been named as a defendant in a
number of product liability lawsuits brought by electricians and other skilled
tradesmen claiming injury from exposure to asbestos found in electrical wire
products produced a number of years ago. During 1996, the number of cases filed
against the Company increased to 95, involving approximately 400 claims. The
Company's strategy is to defend these cases vigorously. The Company believes
that its liability, if any, in these matters and the related defense costs will
not have a material adverse effect either individually or in the aggregate upon
its business, financial condition, cash flows or results of operations. There
can be no assurance, however, that future developments will not alter this
conclusion.

41
<PAGE>
MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

The following table sets forth information concerning the people who will
serve as directors and executive officers of the Company following the Offerings
(ages as of January 31, 1997):

<TABLE>
<CAPTION>
NAME AGE POSITION
- ---------------------------- --- --------------------------------------------------------
<S> <C> <C>
EXECUTIVE OFFICERS:
Steven R. Abbott............ 49 President and Chief Executive Officer; Director
Robert J. Faucher........... 52 Executive Vice President
Dominic A. Lucenta.......... 48 Senior Vice President
Charles W. McGregor......... 55 Executive Vice President
Debra F. Minott............. 41 Senior Vice President, General Counsel and Secretary
Curtis A. Norton............ 51 Senior Vice President
David A. Owen............... 50 Executive Vice President, Treasurer and Chief Financial
Officer
Gregory R. Schriefer........ 44 Executive Vice President
DIRECTORS:
Rodney A. Cohen............. 35 Director
Robert D. Lindsay........... 42 Director
John E. Phipps.............. 64 Director
Ward W. Woods............... 54 Director; Chairman of the Board
</TABLE>

The Restated Certificate provides for a Board of Directors divided into
three classes, with one class to be elected each year to serve for a three-year
term. Concurrent with, or immediately prior to, the consummation of the
Offerings, all directors will be elected to either class A, B or C. [ ] and
[ ] will be Class A directors, [ ] and [ ] Class B directors and
[ ] and [ ] Class C directors. The term of the Class A directors will
expire at the Company's annual meeting of stockholders in 1998. The term of the
Class B directors will expire in 1999 while the term of the Class C directors
will expire in 2000.

Mr. Joseph H. Gleberman, a current director of the Company, has notified the
Board that effective prior to the consummation of the Offerings, he will resign
from the Board. It is anticipated that [ ] and [ ], who are not
representatives of any current stockholder, will comprise a majority of the
members of the audit and stock option committees of the Board of Directors.

Each executive officer of the Company serves at the pleasure of the Board of
Directors.

STEVEN R. ABBOTT was appointed President and Chief Executive Officer of the
Company and Essex on February 26, 1996, and has been a director since February
1996. He was President of the Wire and Cable Sector of Essex from September 1995
to February 1996 and President of the Wire and Cable Division of Essex from
September 1993 to September 1995. He was President of the Magnet Wire and
Insulation Division from 1987 to 1993. Mr. Abbott has been employed by the
Company since 1967.

ROBERT J. FAUCHER was appointed Executive Vice President of the Company in
February 1997. He was appointed Executive Vice President of Essex in September
1995. He was President of the Engineered Products Division of Essex from January
1992 to September 1995 and Vice President, Operations in the Industrial Products
Division of Essex from June 1988 to January 1992. Mr. Faucher joined the Company
in 1985 as Vice President, Planning.

DOMINIC A. LUCENTA was appointed Senior Vice President of the Company in
February 1997. He was appointed Senior Vice President in charge of Human
Resources of Essex in April 1994. From

42
<PAGE>
September 1992 to April 1994 he was Vice President of Human Resources and from
1990 to 1992 he was Director of Human Resources for various divisions of Essex.
He was director of Risk Management from 1988 to 1990. He joined the Company in
1979.

CHARLES W. MCGREGOR was appointed Executive Vice President of the Company
in February 1997. He was appointed Executive Vice President of Essex in October
1996. He was President of the Magnet Wire and Insulation Sector of Essex from
September 1995 to October 1996. He was President of the Magnet Wire and
Insulation Division of Essex from September 1993 to September 1995 and prior to
that was Director of Manufacturing for the Division from 1987 to 1993. Mr.
McGregor has been employed by Essex since 1970.

DEBRA F. MINOTT was appointed Senior Vice President and General Counsel of
the Company in February 1997. She was appointed Senior Vice President and
General Counsel of Essex in October 1994. She was appointed Secretary of the
Company and Essex in April 1995. She has been employed by the Company since
October 1994. From September 1983 to October 1994, Ms. Minott held various legal
positions at Eli Lilly & Company.

CURTIS A. NORTON was appointed Senior Vice President of the Company in
February 1997. He was appointed Senior Vice President in charge of Corporate
Support Operations of Essex in September 1995. He was Vice President of
Purchasing from April 1994 to September 1995 and Director of Purchasing from
1989 to 1994. Mr. Norton has been employed by the Company since 1981.

DAVID A. OWEN was appointed Executive Vice President of the Company in
February 1997. He was appointed Vice President, Treasurer and Chief Financial
Officer of the Company in March 1993. He was appointed Executive Vice President
and Chief Financial Officer of Essex in March 1994. He had been appointed Vice
President--Finance and Chief Financial Officer of Essex in March 1993, and
Treasurer of Essex in April 1992. Prior to that time, Mr. Owen was Director,
Treasury and Financial Services for Essex. Mr. Owen has been employed by the
Company since 1976.

GREGORY R. SCHRIEFER was appointed Executive Vice President of the Company
in February 1997. He was appointed Executive Vice President of Essex in October
1996. He was Vice President and General Manager of Building Wire Products from
September 1995 to October 1996 and was Vice President, Manufacturing of the Wire
and Cable Division from April 1994 to September 1995. Mr. Schriefer has been
employed in various positions with the Company since 1981.

RODNEY A. COHEN has been a director of the Company since March 1996. Mr.
Cohen is a member of the limited liability company that is the general partner
of each of the partnerships comprising BH Group. Since July 1993, Mr. Cohen has
been a principal of a partnership affiliated with BHLP, to which Essex and the
Company paid the fees described in "Certain Relationships and Related Party
Transactions". From September 1991 to July 1993, he was a principal of Bessemer
Securities Corporation ("BSC"), a principal limited partner in two of the
partnerships comprising BH Group. Prior to joining BSC, Mr. Cohen was an
associate in the Mergers and Acquisitions Department of Morgan Stanley & Co.
Incorporated. Mr. Cohen is also a director of a number of private companies. Mr.
Cohen was nominated to the Board by BH Group.

ROBERT D. LINDSAY is the sole shareholder and president of a corporation
that is a manager of a limited liability company that is the general partner of
each of the partnerships comprising BH Group. He is also the sole shareholder of
corporations that are general partners of a partnership affiliated with BHLP to
which the Company paid the fees described in "Certain Relationships and Related
Party Transactions". Mr. Lindsay was Managing Director of BSC from January 1991
to June 1993. Prior to joining BSC, Mr. Lindsay was a Managing Director in the
Merchant Banking Division of Morgan Stanley & Co. Incorporated. He is the
Chairman of the Board of Metropolitan International, Inc., and a director of
Stant

43
<PAGE>
Corporation and several private companies. Mr. Lindsay has been a director of
the Company since October 1992. Mr. Lindsay was nominated to the Board by BH
Group.

JOHN E. PHIPPS is a private investor. He is chairman and partner of Phipps
Ventures LLC and a director of Bessemer Securities, LLC ("BSLLC"), BSC, Bessemer
Trust Company, Bessemer Trust Company of Florida, Bessemer Trust Company, N.A.,
The Bessemer Group, Incorporated and W. R. Grace & Co. Mr. Phipps has been a
director of the Company since December 1993. Mr. Phipps was nominated to the
Board by BH Group.

WARD W. WOODS is Chairman of the Board of Directors of Essex International.
Mr. Woods is the sole shareholder and president of a corporation that is the
principal manager of a limited liability company that is the general partner of
each of the partnerships comprising BH Group. He is also the sole shareholder of
corporations that are the managing general partners of a partnership affiliated
with BHLP to which the Company paid the fees described in "Certain Relationships
and Related Party Transactions". Mr. Woods is President and Chief Executive
Officer of BSLLC and BSC. Mr. Woods joined BSC in 1989. For ten years prior to
joining BSC, Mr. Woods was a senior partner of Lazard Freres & Co. LLC, an
investment banking firm. He is Chairman of the Board of Stant Corporation. He is
a director of Boise Cascade Corporation, Freeport-McMoran Copper & Gold, Inc.,
Graphic Controls Corporation, Kelley Oil & Gas Corporation and several private
companies. Mr. Woods has been a director of the Company since October 1992. Mr.
Woods was nominated to the Board by BH Group.

Following the Offerings the Company will have an Audit Committee composed of
[ ] and a Compensation Committee composed of [ ].

COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS

It is expected that the directors of the Company will receive normal and
customary compensation for their service as directors, together with
reimbursement of expenses incidental to attendance at meetings of the Board of
Directors or committees thereof. The following table sets forth the cash and
non-cash compensation paid by or incurred on behalf of the Company to its Chief
Executive Officer and the four other most highly compensated executive officers
for each of the three years ended December 31, 1996.

44
<PAGE>
SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG TERM
COMPENSATION AWARDS
ANNUAL ----------------------
COMPENSATION NUMBER OF SECURITIES
-------------------- UNDERLYING OPTIONS/ ALL OTHER
SALARY BONUS SARS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($) ($) (#) ($)(A)
- ----------------------------------------- --------- --------- --------- ---------------------- ---------------
<S> <C> <C> <C> <C> <C>
Steven R. Abbott......................... 1996 287,993 600,000 125,000 27,531
President and Chief Executive Officer (b) 1995 193,757 250,000 37,500 12,999
1994 182,502 200,000 60,000 8,306
Stanley C. Craft (c)..................... 1996 325,008 0 0 15,155
1995 310,004 450,000 50,000 27,905
1994 293,763 400,000 75,000 22,174
Charles W. McGregor...................... 1996 167,001 275,000 40,000 11,356
Executive Vice President 1995 157,503 210,000 32,500 9,684
1994 132,504 165,000 50,000 7,787
David A. Owen............................ 1996 167,001 250,000 37,500 9,195
Executive Vice President and Chief 1995 157,503 185,000 25,000 8,120
Financial Officer 1994 145,257 165,000 50,000 6,894
Robert J. Faucher........................ 1996 167,001 250,000 50,000 11,972
Executive Vice President 1995 157,503 175,000 25,000 11,356
1994 149,379 145,000 50,000 8,568
Gregory R. Schriefer..................... 1996 129,510 225,000 57,500 11,062
Executive Vice President
</TABLE>

- ------------------------

(a) All Other Compensation in 1996 consists of Company contributions to the
defined contribution and deferred compensation plans on behalf of the
executive officer and imputed income on excess Company-paid life insurance
premiums. The following table identifies and quantifies these amounts for
the named executive officers:

<TABLE>
<CAPTION>
S.R. S.C. C.W. D.A. R.J. G.R.
ABBOTT CRAFT MCGREGOR OWEN FAUCHER SCHRIEFER
--------- --------- ----------- --------- --------- -----------
<S> <C> <C> <C> <C> <C> <C>
Company matching under the defined
contribution and deferred compensation
plans.................................... $ 25,700 $ 9,750 $ 8,498 $ 7,478 $ 10,335 $ 10,635
Imputed income on excess life insurance
premiums................................. 1,831 5,405 2,858 1,717 1,637 427
--------- --------- ----------- --------- --------- -----------
Total...................................... $ 27,531 $ 15,155 $ 11,356 $ 9,195 $ 11,972 $ 11,062
--------- --------- ----------- --------- --------- -----------
--------- --------- ----------- --------- --------- -----------
</TABLE>

(b) Mr. Abbott was appointed President and Chief Executive Officer of the
Company and Essex on February 26, 1996.

(c) Mr. Craft served as President and Chief Executive Officer of the Company
from October 1992 until February 26, 1996, and also of Essex from March 1992
until February 26, 1996.

45
<PAGE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR

<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT
ASSUMED ANNUAL RATES
OF
STOCK PRICE
APPRECIATION FOR
INDIVIDUAL GRANTS OPTION TERM (A)
--------------------------------------------------------------- ----------------------
<S> <C> <C> <C> <C> <C> <C>
NUMBER OF % OF TOTAL
SECURITIES OPTIONS/SARS
UNDERLYING GRANTED TO
OPTIONS/SARS EMPLOYEES IN EXERCISE OR
GRANTED RESPECT OF LAST BASE PRICE EXPIRATION
NAME (#)(B) FISCAL YEAR ($/SH) DATE 5% ($) 10% ($)
- --------------------------- -------------- ------------------- ------------- ----------- --------- -----------
Steven R. Abbott........... 125,000 15.3 10.00 1/30/07 786,118 1,992,178
Stanley C. Craft........... 0 0 -- -- 0 0
Charles W. McGregor........ 40,000 4.9 10.00 1/30/07 251,558 637,497
David A. Owen.............. 37,500 4.6 10.00 1/30/07 235,835 597,653
Robert J. Faucher.......... 50,000 6.1 10.00 1/30/07 314,447 796,871
Gregory R. Schriefer....... 57,500 7.0 10.00 (c) 361,614 916,402
</TABLE>

- ------------------------

(a) The potential realizable value assumes a per-share market price at the time
of the grant to be approximately $10.00 with an assumed rate of appreciation
of 5% and 10%, respectively, compounded annually for 10 years. These values
are provided pursuant to the rules and regulations of the Commission. No
assurance can be given as to the appreciation, if any, of the Common Stock.

(b) In October 1996 options to purchase 87,500 shares of Common Stock were
granted. Such options become exercisable on October 1, 1999. In January 1997
options to purchase 730,000 shares of Common Stock were granted to maintain
management's equity interest in the Company as a result of the increase in
total Common Stock outstanding following the 1996 Private Offering and in
respect of performance for the year ended December 31, 1996 (see "--Stock
Option Plan"). Such options become exercisable on January 30, 1998.

(c) Options to purchase 25,000 and 32,500 shares of Common Stock granted in
October 1996 and January 1997, respectively, expire on October 1, 2006 and
January 30, 2007, respectively.

The following table details the December 31, 1996, year-end estimated value
of each named executive officer's unexercised stock options. All unexercised
options are to purchase the number of shares of Common Stock indicated, although
the Board of Directors may require that, in lieu of the exercise of any
Roll-over Options, such options be surrendered without payment of the exercise
price, in which case the number of shares issuable upon exercise of such
Roll-over Options shall be reduced by a number of shares equal to the product of
(A) the number of shares specified in the grant and (B) the quotient of (x) the
original exercise price (unadjusted for any split or other reorganization) and
(y) approximately 2.86. See "Stock Option Plan".

46
<PAGE>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND YEAR-END OPTION/SAR VALUES

<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS/SARS AT OPTIONS/SARS AT
SHARES ACQUIRED YEAR-END (#) YEAR-END ($)
ON VALUE REALIZED EXERCISABLE (E)/ EXERCISABLE (E)/
NAME EXERCISE (#) ($) UNEXERCISABLE (U)(A) UNEXERCISABLE (U)(B)
- ------------------------------------ ----------------- ----------------- ----------------------- ---------------------
<S> <C> <C> <C> <C>
Steven R. Abbott -- -- 149,000(E) 1,141,811 (E)
222,500(U) 417,774(U)

Stanley C. Craft -- -- 311,500(E) 2,413,197(E)
125,000(U) 535,608(U)

Charles W. McGregor -- -- 35,250(E) 233,561(E)
122,500(U) 353,501(U)

David A. Owen -- -- 38,500(E) 258,811(E)
112,500(U) 321,365(U)

Robert J. Faucher -- -- 85,000(E) 624,811(E)
125,000(U) 321,365(U)

Gregory R. Schriefer -- -- 10,225(E) 80,550(E)
67,500(U) 42,849(U)
</TABLE>

- ------------------------

(a) The options to purchase Common Stock granted in 1997 with respect to the
1996 Private Offering and 1996 performance become exercisable on January 30,
1998. The options to purchase Common Stock granted in 1995 and 1996 become
exercisable three years from the date of grant. All other options granted
prior to those issued in 1995 are currently exercisable.

(b) The estimated value of in-the-money stock options held at the end of 1996
assumes a per-share fair market value of approximately $10.00 and per-share
exercise prices of $2.00, $2.50 and $5.72, as applicable.

PENSION PLANS. The Company provides benefits under a defined benefit
pension plan (the "Pension Plan") and a supplemental executive retirement plan
(the "SERP"). The following table illustrates the estimated annual normal
retirement benefits at age 65 that will be payable under the Pension Plan and
SERP.

PENSION PLAN TABLE

<TABLE>
<CAPTION>
YEARS OF SERVICE
---------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
REMUNERATION 15 20 25 30 35
- -------------- ----------- ----------- ----------- ----------- -----------
125,000..... $ 28,125 $ 37,500 $ 46,875 $ 56,250 $ 65,625
150,000..... 33,750 45,000 56,250 67,500 78,750
175,000..... 39,375 52,500 65,625 78,750 91,875
200,000..... 45,000 60,000 75,000 90,000 105,000
225,000..... 50,625 67,500 84,375 101,250 118,125
250,000..... 56,250 75,000 93,750 112,500 131,250
300,000..... 67,500 90,000 112,500 135,000 157,500
400,000..... 90,000 120,000 150,000 180,000 210,000
450,000..... 101,250 135,000 168,750 202,500 236,250
500,000..... 112,500 150,000 187,500 225,000 262,500
</TABLE>

47
<PAGE>
The remuneration utilized in calculating the benefits payable under the
Pension Plan and the SERP is the compensation reported in the Summary
Compensation Table under the captions Salary and Bonus. The formula utilizes the
remuneration for the five consecutive plan years within the ten completed
calendar years preceding the participant's retirement date that produces the
highest final average earnings.

As of December 31, 1996, the years of credited service under the Pension
Plan for each of the executive officers named in the Summary Compensation Table
were as follows: Mr. Abbott, twenty-seven years and seven months; Mr. Craft,
twenty-seven years and nine months; Mr. Owen, twenty years and eight months; Mr.
McGregor, twenty-six years and eleven months; Mr. Faucher, twenty-four years and
six months; and Mr. Schriefer, fifteen years and three months.

The benefits listed in the Pension Plan Table are based on the formula in
the Pension Plan using a straight-life annuity and are subject to an offset of
50% of the participant's annual unreduced Primary Insurance Amount under Social
Security. In addition, benefits for credited service for years prior to 1974 are
calculated using the formula in effect at that time and would reflect a lesser
benefit than outlined in the Pension Plan Table for those years. Benefits under
the Pension Plan are also offset by benefits to which the participant is
entitled under any defined benefit plan of UTC (other than accrued benefits
transferred to the Pension Plan).

STOCK OPTION PLAN

Grants of options to purchase Common Stock have been made to management and
employees of the Company pursuant to, and are subject to the provisions of, an
Amended and Restated Stock Option Plan, as amended (the "Stock Option Plan"),
and individual stock option agreements. Options granted prior to January 1, 1997
are exercisable: (i) in full, upon the third anniversary of the grant of the
options; (ii) in full, upon the death, retirement or disability of the optionee;
(iii) in part, upon the occurrence of a Company Sale (as defined below), in
which case the option becomes exercisable in a portion equal to the percentage
of the Company's then outstanding voting stock transferred pursuant to the
transactions constituting the Company Sale; and (iv) in part, upon the sale by
BH Group of 25% or more of the then outstanding Common Stock, in which case the
option becomes exercisable in a portion equal to the percentage of the Company's
then outstanding common stock sold by BH Group pursuant to the sale. Options
granted on January 30, 1997, in connection with the Company's 1996 performance
and to maintain management's equity interest in the Company as a result of the
increase in total Common Stock outstanding following the 1996 Private Offering
are exercisable: (i) in full, upon the first anniversary of the grant of the
options and (ii) in full or in part, as described in clauses (ii), (iii) and
(iv) of the prior sentence. Options granted after January 30, 1997, are
exercisable: (i) in full, upon the third anniversary of the grant of the
options, provided that during the second year the option is outstanding it may
be exercised as to not more than one-third (1/3) of the total number of shares
covered by the option and during the third year the option is outstanding it may
be exercised as to, cumulatively, not more than two-thirds (2/3) of the total
number of shares covered by the option and (ii) in full or in part, as described
in clauses (ii), (iii) and (iv) of the second sentence of this paragraph.

Such options are generally not transferable. For the purposes of the Stock
Option Plan, a "Company Sale" is deemed to have occurred if any person (other
than BH Group) becomes the beneficial owner of 50% or more of the combined
voting power of the Company's securities or acquires substantially all the
assets of Essex International or Essex.

The Board of Directors of the Company may require that certain options
granted in connection with the Acquisition (the "Roll-over Options") be
surrendered and cancelled without payment of the exercise price. In this event,
the optionee is entitled to receive a number of shares of Common Stock equal to
the number specified in the grant, reduced by a number of shares equal to the
product of (A) the number of shares specified in the grant and (B) the quotient
of (x) the original exercise price (unadjusted for any split or other
reorganization) and (y) approximately 2.86.

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<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

Messrs. Lindsay, Woods and Gleberman have been members of the Compensation
Committee of the Board of Directors. Subsequent to the Offerings, the Board of
Directors expects to replace two of such directors with directors who are not
representatives of any current stockholder. The Compensation Committee fixes the
compensation paid to the Company's executive officers, based in part on the
recommendation of Mr. Abbott. See "--Directors and Executive Officers" and
footnote (k) of "Principal and Selling Stockholders" for a description of the
relationship between Messrs. Lindsay and Woods and BH Group and the information
set forth under the caption "Certain Relationships and Related Party
Transactions" for a description of certain transactions between the Company and
BH Group.

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<PAGE>
PRINCIPAL AND SELLING STOCKHOLDERS

The following table sets forth certain information regarding the beneficial
ownership of Common Stock (i) immediately prior to the Offerings and (ii) as
adjusted to reflect the sale of shares in the Offerings by (a) each person known
by the Company to be the beneficial owner of more than 5% of the outstanding
shares of Common Stock, (b) each of the Company's directors following the
Offerings, (c) each named executive officer, (d) all directors and executive
officers of the Company following the Offerings as a group and (e) each Selling
Stockholder. Unless otherwise noted in the footnotes to the table, the persons
named in the table have sole voting and investment power with respect to all
shares of Common Stock indicated as being beneficially owned by them.

<TABLE>
<CAPTION>
PRIOR TO OFFERINGS (a) AFTER THE OFFERINGS
---------------------------- ----------------------------
<S> <C> <C> <C> <C> <C>
SHARES TO BE SOLD
NUMBER OF PERCENT IN NUMBER OF PERCENT
NAME SHARES OWNERSHIP THE OFFERINGS SHARES OWNERSHIP
- ---------------------------------------------------- ------------- ------------- ----------------- ----------- ---------------
DIRECTORS, EXECUTIVE OFFICERS AND PRINCIPAL
STOCKHOLDERS:
Steven R. Abbott(b)(c)(d)........................... 306,000.0 1.3 *
Rodney A. Cohen(e).................................. 0.0 * 0 0 *
Robert J. Faucher(b)(c)(f).......................... 191,488.5 * *
Robert D. Lindsay(e)................................ 0.0 * 0 0 *
Charles W. McGregor(b)(c)(g)........................ 73,623.0 * *
David A. Owen(b)(c)(h).............................. 80,914.0 * *
John E. Phipps(e)................................... 0.0 * 0 0 *
Gregory R. Schriefer(b)(c)(i)....................... 41,593.5 * *
Ward Woods(e)....................................... 0.0 * 0 0 *
All directors and executive officers as a group (12
persons(j))....................................... 18,359,795.0 75.3
Bessemer Holdings, L.P.(b)(k)(l)(m)................. 17,548,165.5 73.1
The Goldman Sachs Group, L.P.(n)(o)................. 3,707,724.0 14.8
DLJ International Partners, C.V.(p)(q).............. 2,743,962.5 10.7
Chase Equity Associates(r)(s)....................... 1,104,869.0 4.6
</TABLE>

- ------------------------

* Represents holdings of less than one percent.

(a) Prior to the Offerings, there were 26,839,926.5 shares of Common Stock
outstanding, including 2,833,369 shares of Common Stock issuable upon
exercise of the Warrants. Percentages have been calculated assuming, in the
case of each person or group listed, the exercise of all warrants and
options owned (that are exercisable within sixty days following the date of
this Prospectus) by each such person or group, respectively, but not the
exercise of any warrants or options owned by any other person or group
listed.

(b) All shares of Common Stock owned by executive officers, employees, former
employees and retirees of the Company, or their respective estates (a total
of 1,735,205.5 shares), currently are subject to a proxy held by BHLP. This
proxy will terminate upon consummation of the Offerings. Pursuant to the
terms of certain option agreements, the aggregate number of shares issuable
upon exercise of such options can be reduced. See "Management--Stock Option
Plan".

(c) The address for each of these beneficial owners is c/o Essex International
Inc., 1601 Wall Street, Fort Wayne, Indiana 46802.

(d) Includes 149,000 shares issuable upon exercise of options held by Mr.
Abbott, 136,500 of which, pursuant to the applicable option agreement, may
be reduced to 88,076 shares.

(e) The address for each of these directors is c/o BHLP, 630 Fifth Avenue, New
York, NY 10111.

(f) Includes 85,000 shares issuable upon exercise of options held by Mr.
Faucher, 72,500 of which, pursuant to the applicable option agreement, may
be reduced to 45,598 shares.

(g) Includes 35,250 shares issuable upon exercise of options held by Mr.
McGregor, 22,750 of which, pursuant to the applicable option agreement, may
be reduced to 14,438.5 shares.

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<PAGE>
(h) Includes 38,500 shares issuable upon exercise of options held by Mr. Owen,
26,000 of which, pursuant to the applicable option agreement, may be reduced
to 16,420 shares.

(i) Includes 10,225 shares issuable upon exercise of options held by Mr.
Schriefer that, pursuant to the applicable option agreement, may be reduced
to 6,428 shares.

(j) Consists of the 17,548,165.5 shares of Common Stock owned by BH Group,
that, together with the shares described below, may be deemed to be
beneficially owned by Messrs. Woods, Lindsay and Cohen (which beneficial
ownership is disclaimed by Messrs. Woods, Lindsay and Cohen--see footnote
(k) below), 449,379.5 shares of Common Stock owned by the executive officers
of Essex International included in this group, 362,250 shares of Common
Stock issuable to the executive officers of Essex International included in
this group upon exercise of options which, pursuant to the applicable option
agreements, may be reduced and excludes 1,285,826 shares of Common Stock,
along with 1,578,725 shares of Common Stock issuable upon exercise of
options (also subject to reduction) owned by other employees, former
employees and retirees of the Company.

(k) BHLP is a limited partnership the only activity of which is to make private
structured investments. The primary limited partner of BHLP is BSC. Each of
Messrs. Woods and Lindsay, directors of the Company, and Mr. Michael B.
Rothfeld, is a sole shareholder of a corporation that is a manager and
controls a family partnership that is a member of the limited liability
company that is the sole general partner of BHLP. Mr. Cohen, a director of
the Company, also is a member of that limited liability company. That
limited liability company is also the sole general partner of six other
limited partnerships that hold in the aggregate 4,175,173 additional shares
of Common Stock (see footnote (l) below). Mr. Phipps is a director of BSC
and BSLLC. BSC is a principal limited partner of BHLP and Bessec Holdings,
L.P. BSLLC is a principal limited partner of Bessec Holdings, L.P. (see
footnote (l) below). In addition, Messrs. Woods, Lindsay and Rothfeld are
the sole shareholders of corporations that are the general partners of, and
Mr. Cohen is a principal of, the partnership affiliated with BHLP to which
the Company paid the fees described in "Certain Relationships and Related
Party Transactions". Mr. Woods is the President and Chief Executive Officer
of BSLLC and BSC. Each of Messrs. Woods, Lindsay, Rothfeld and Cohen
disclaims beneficial ownership of the shares of Common Stock owned or
controlled by BHLP and such other limited partnerships.

(l) The share ownership figure for BHLP includes 20,202 shares held by Bessemer
Holdings Special Situations, L.P., 1,140,562.5 shares held by BGE Partners,
L.P., 1,036,875 shares held by BNE Partners, L.P., 1,140,562.5 shares held
by BTE Partners, L.P., 599,500 shares held by BCE Partners, L.P. and 237,471
shares held by Bessec Holdings, L.P., affiliates of BHLP.

(m) The address for BHLP is 630 Fifth Avenue, New York, NY 10111.

(n) Represents in the aggregate 2,587,172.5 shares of Common Stock and warrants
to purchase 1,120,551.5 shares of Common Stock owned by the GS Partnerships,
of which affiliates of The Goldman Sachs Group, L.P. ("GS Group") are the
general partner or managing general partner, including (i) 2,532,493 shares
of Common Stock and warrants to purchase 1,092,538 shares of Common Stock
owned by GS Capital Partners, L.P., (ii) 34,120 shares of Common Stock and
warrants to purchase 17,480.5 shares of Common Stock owned by Stone Street
Fund 1992, L.P. and (iii) 20,559.5 shares of Common Stock and warrants to
purchase 10,533 shares of Common Stock owned by Bridge Street Fund 1992,
L.P. The GS Partnerships share voting and investment authority with certain
of their affiliates. GS Group disclaims beneficial ownership of the shares
owned by the GS Partnerships to the extent interests in such partnerships
are owned by persons other than GS Group and its affiliates.

(o) The address for GS Group and the GS Partnerships is 85 Broad Street, New
York, NY 10004.

(p) Includes 1,712,817.5 shares issuable upon exercise of Warrants held by
affiliates of DLJSC.

(q) The address for DLJ International Partners, C.V. is c/o John P. Gorsiraweg
6, Willemstad, Curacao, Netherlands Antilles, and the address for the other
affiliates of DLJSC is 277 Park Avenue, New York, NY 10172.

(r) The share ownership figure for CEA does not include 599,500 shares of Common
Stock in which CEA has an indirect ownership interest through its limited
partnership interest in BCE Partners, L.P.

(s) The address for CEA is 380 Madison Avenue, New York, NY 10017.

51
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

The Company incurred advisory fees of approximately $1.0 million for each
year during the three-year period ending December 31, 1996, payable to an
advisory partnership that is an affiliate of BHLP. Pursuant to an advisory
services agreement among Essex International, Essex and the advisory
partnership, Essex agreed to pay such affiliate an annual advisory fee of $1.0
million. The agreement is terminable by any party on 30 days prior notice to the
other parties. See footnote (k) of "Principal and Selling Stockholders" for a
description of the relationship of Messrs. Woods, Lindsay and Cohen, directors
of the Company, to such BHLP affiliate.

Pursuant to an engagement letter dated July 22, 1992, as amended by a letter
agreement dated October 9, 1992 (collectively, the "Engagement Letter"), DLJSC
and Goldman Sachs were given the right, but not the obligation, subject to
certain conditions, to act as financial advisor to the Company until October
1997, on a co-exclusive basis in connection with all acquisition, divestiture
and other financial advisory assignments relating to the Company and to act as
co-exclusive managing placement agents or co-exclusive managing underwriters in
connection with any debt or equity financing that is either privately placed or
publicly offered (excluding commercial bank debt or other senior debt that is
privately placed other than any private placement that contemplates a
registration of, registered exchange offer for, or similar registration with
respect to such securities). DLJSC also had the right, but not the obligation,
to act as co-managing placement agent or co-managing underwriter, together only
with The Chase Manhattan Bank in connection with other senior debt that is
privately placed. The Company retained the right to designate DLJSC or The Chase
Manhattan Bank as lead placement agent or lead managing underwriter. However, as
a result of the occurrence of a Sell Down Date (as defined) in 1995, and in
accordance with the Engagement Letter, DLJSC no longer has the right to act as
financial advisor to the Company under the engagement letter because it no
longer holds a specified minimum investment in the Company.

Pursuant to such engagement letter, DLJSC and Goldman Sachs acted as
underwriters in the offering of the Essex Senior Notes, and in such capacity
received aggregate underwriting discounts and commissions of $5.3 million. For
any further services performed by Goldman Sachs pursuant to the Engagement
Letter, Goldman Sachs is entitled to fees competitive with those customarily
charged by Goldman Sachs and other major investment banks in similar
transactions and to customary out of pocket fee and expense reimbursement and
indemnification and contribution agreements.

In July 1996, the Board of Directors of the Company approved the 1996
Private Offering which consisted of an offering of shares of Common Stock to
certain stockholders of the Company and certain limited partnerships affiliated
with BH Group at $10.00 per share of Common Stock. BH Group, the GS Partnerships
and CEA purchased an aggregate of 5,930,000 shares of Common Stock at that
price. DLJ, also a stockholder of the Company, elected not to purchase shares of
Common Stock at that price in the 1996 Private Offering. In December 1996, as
part of the 1996 Private Offering, certain management employees of the Company,
including each executive officer, purchased an aggregate of 437,708.5 shares of
Common Stock at $10.00 per share of Common Stock.

INVESTORS SHAREHOLDERS AGREEMENT

In connection with the Acquisition, BHLP (as successor in interest to
Bessemer Capital Partners, L.P.), the GS Partnerships, DLJ and CEA (together
with certain assignees, the "Initial Shareholders") entered into the Investors
Shareholders Agreement, dated as of October 9, 1992 (as amended, the "Investors
Shareholders Agreement"), with the Company. Set forth below is a summary of
certain terms of the Investors Shareholders Agreement. The summary does not
purport to be complete and is subject to, and is qualified in its entirety by,
the Investors Shareholders Agreement, which is filed as an exhibit to the
Registration Statement of which this Prospectus is a part.

52
<PAGE>
BOARD OF DIRECTORS. The Investors Shareholders Agreement provides that the
Initial Shareholders will use their power to cause the Board of Directors of the
Company to be composed of seven directors, that BHLP (as successor in interest
to Bessemer Capital Partners, L.P.) shall have the right to nominate five of
these directors and that, so long as the GS Partnerships own a minimum number of
shares of Common Stock, the GS Partnerships will have the right to nominate one
director, which director will sit on all committees of the Board of Directors.
As a result of these arrangements, BHLP controls the Board of Directors of the
Company. These rights survive the Termination Date (as defined below).

The Agreement also grants to BHLP and, so long as the GS Partnerships own a
minimum number of shares of Common Stock, to the GS Partnerships, the right to
veto certain extraordinary transactions by the Company. This right terminates on
the Termination Date. As a result of the Offerings, it is anticipated that the
GS Partnerships will not have any such veto rights.

APPROVAL OF CERTAIN MATTERS. The Investors Shareholders Agreement provides
that, without the approval of the Board of Directors, the Company will not, and
will not permit any subsidiary to, sell assets having an aggregate value in
excess of $1.0 million, grant liens in excess of $1.0 million, make capital
expenditures in excess of $1.0 million or prepay, repurchase or redeem any debt
or equity security if the amount used for such purpose exceeds $1.0 million. The
requirement for Board approval of such matters terminates on the Termination
Date.

TAG-ALONG RIGHTS. Subject to certain exceptions, if at any time BHLP or any
of its affiliates or associates propose to sell to a third party or parties,
directly or indirectly (other than in a registered public offering), any shares
of Common Stock, then effective provision will be made whereby each other
Initial Shareholder will be given the right to sell an equal proportion of its
Common Stock to such third party or parties on terms identical to those
applicable to such proposed sale. This right SURVIVES the Termination Date.

Subject to certain exceptions, if at any time BHLP or any of its affiliates
or associates propose to purchase from other stockholders of the Company,
directly or indirectly, any shares of Common Stock, then effective provision
will be made whereby each other Initial Shareholder will be given the right to
purchase the proportion of the Common Stock of such other stockholder that its
Common Stock bears to the Common Stock owned by all Initial Shareholders, on
terms identical to those applicable to such proposed purchase. This right
terminates on the Termination Date.

PRE-EMPTIVE RIGHTS. The Investors Shareholders Agreement provides that the
Initial Shareholders shall have the pre-emptive right to subscribe to issuances
by the Company of equity securities or securities convertible into equity
securities. This right terminates on the Termination Date.

RIGHT OF FIRST OFFER. The Investor Shareholders Agreement requires that
each Initial Shareholder offer to the Company and, if the Company declines, to
the other Initial Shareholders, any shares of Common Stock to be sold or
otherwise transferred by the Initial Shareholder (other than pursuant to a
public offering). This right terminates on the Termination Date.

TERMINATION DATE. For the purposes of the Investors Shareholders Agreement,
the "Termination Date" is the closing date of a public offering whereby, on such
date, 25% of the total number of outstanding shares of Common Stock (including
those issuable pursuant to options, warrants and rights) have been sold in one
or more public offerings. It is anticipated that the closing date of the
Offerings will be the Termination Date.

BH Group, the GS Partnerships and DLJ have various rights to require the
registration of their shares of Common Stock. See "Shares Eligible for Future
Sale--Registration Rights."

53
<PAGE>
MANAGEMENT STOCKHOLDERS AGREEMENT

The members of Essex's management who are stockholders of the Company (each
a "Management Stockholder") are each parties to the Management Stockholders and
Registration Rights Agreement dated as of October 9, 1992, as amended (the
"Management Stockholders Agreement"), which relates to the ownership of their
Common Stock. All Common Stock held by a Management Stockholder, whether
obtained before, as a result of, or subsequent to, the Offerings, is subject to
the Management Stockholders Agreement.

Set forth below is a summary of certain terms of the Management Stockholders
Agreement. The summary does not purport to be complete and is subject to, and is
qualified in its entirety by, the Management Stockholders Agreement, which is
filed as an exhibit to the Registration Statement of which this Prospectus is a
part.

TRANSFER RESTRICTIONS. The Management Stockholders Agreement provides that
Management Stockholders may not transfer, sell, assign, pledge, hypothecate or
otherwise dispose of (collectively, "Transfer") any of their Common Stock except
as provided in the Management Stockholders Agreement. This restriction will
expire 90 days after the closing of the Offerings.

RIGHT OF FIRST REFUSAL. If any Management Stockholder receives a bona fide
offer to purchase any of his or her Common Stock, such Management Stockholder
may Transfer such Common Stock only after offering such Common Stock first to
the Company and then, if not accepted by the Company, to BH Group, in each case
on the same terms and conditions as the bona fide offer. This restriction will
expire 90 days after the closing of the Offerings.

TAG-ALONG RIGHTS. Subject to certain exceptions, if at any time BH Group
proposes to sell to a third party or parties, directly or indirectly (other than
in a public offering), any shares of Common Stock, then provision will be made
whereby each Management Shareholder will be given the right to sell an equal
proportion of his or her Common Stock to such third party or parties on terms
identical to those applicable to such proposed sale.

PUT OPTIONS. Subject to certain exceptions, including those related to the
Company's credit facilities, if any Management Stockholder's employment with the
Company is terminated prior to the Offerings, then such Management Stockholder
or his or her estate will have the right for one year following the date of
termination of employment to sell to the Company (or its designee) any or all
shares of Common Stock then held by such Management Stockholder or his or her
estate for their fair market value.

REGISTRATION RIGHTS. Management Stockholders have the right to "piggyback"
or include their Common Stock in any registration of Common Stock (i) demanded
by BH Group or any other stockholder (unless the Company is contractually
prohibited from granting such piggyback rights) or (ii) for a primary offering
by the Company (other than any registration relating to employee benefit or
similar plans or acquisitions of companies by the Company), subject to the right
of the managing underwriter to restrict the size of the registration if the
number of shares requested to be sold by Management Stockholders would have an
adverse effect on the offering. BH Group may demand registration of Common Stock
held by it at any time. These provisions will survive the Offerings.

TERMINATION. The Management Stockholders Agreement (other than with respect
to pending purchases and sales) will terminate thirty days following BH Group
ceasing to have beneficial ownership of 7,000,000 shares of Common Stock.

LIMITATIONS ON LIABILITY OF OFFICERS AND DIRECTORS

The Restated Certificate and the By-laws provide broadly for indemnification
of the officers and directors of the Company. The Restated Certificate provides
that no director shall be personally liable to

54
<PAGE>
the Company or any of its stockholders for monetary damages for breach of
fiduciary duty as a director, except for liability (i) for any breach of the
director's duty of loyalty to the Company or its stockholders, (ii) for acts or
omissions not in good faith or that involve intentional misconduct or a knowing
violation of law, (iii) pursuant to Section 174 of the Delaware General
Corporation Law or (iv) for any transaction from which the director derived an
improper personal benefit. The effect of the provision in the Restated
Certificate is to eliminate the right of the Company and its stockholders
(through stockholders' derivative suits on behalf of the Company) to recover
monetary damages against a director for breach of the fiduciary duty of care as
a director (including breaches resulting from negligent or grossly negligent
behavior) except in the situations described in clauses (i) through (iv) above.
This provision does not limit or eliminate the rights of the Company or any
stockholder to seek non-monetary relief such as an injunction or recession in
the event of a breach of a director's duty of care. The By-laws also provide a
broad right of indemnification to the directors, officers, employees and agents
of the Company. Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors or officers pursuant to the
foregoing provisions, the Company has been informed that in the opinion of the
Commission, such indemnification is against public policy as expressed in the
Securities Act and is therefore unenforceable.

55
<PAGE>
DESCRIPTION OF CAPITAL STOCK

Upon consummation of the Offerings, the authorized capital stock of the
Company will consist of 150,000,000 shares of Common Stock, par value $.01 per
share, and 5,000,000 shares of preferred stock, par value $.01 per share
("Preferred Stock").

PREFERRED STOCK

No shares of Preferred Stock are currently outstanding and no shares of
Preferred Stock will be outstanding immediately after the closing of the
Offerings. The Board of Directors has the authority, without further action by
the stockholders, to issue up to 5,000,000 shares of Preferred Stock in one or
more series and to fix the rights, preferences, qualifications, limitations and
restrictions of each such series. Although it presently has no intention to do
so, the Board of Directors, without stockholder approval, could issue Preferred
Stock with voting, conversion or other rights that could adversely affect the
voting power of the holders of Common Stock and that could have certain
anti-takeover effects.

COMMON STOCK

As of December 31, 1996, there were 24,056,557.5 shares of Common Stock
outstanding and held of record by approximately 73 stockholders.

Holders of Common Stock are entitled to one vote for each share held of
record on all matters submitted to a vote of the stockholders. Such stockholders
have no right to cumulate their votes in the election of directors. Subject to
preferences that may be applicable to any outstanding shares of Preferred Stock,
holders of Common Stock are entitled to receive ratably such dividends as may be
declared by the Board of Directors out of funds legally available therefor. In
the event of a liquidation, dissolution or winding up of the Company, holders of
Common Stock are entitled to share ratably in all assets remaining after payment
of liabilities and liquidation preferences of any outstanding shares of
Preferred Stock. Holders of Common Stock have no right to convert their Common
Stock into any other securities. Certain holders of Common Stock have
pre-emptive rights pursuant to the Investors Shareholders Agreement, as
described in "Certain Relationships and Related Party Transactions--Investors
Shareholders Agreement". It is anticipated that these rights will cease to exist
upon the closing of the Offerings. There are no redemption or sinking fund
provisions applicable to the Common Stock. All outstanding shares of Common
Stock are, and all shares of Common Stock to be outstanding upon completion of
the Offerings will be, duly authorized, validly issued, fully paid and
nonassessable.

After the consummation of the Offerings, BH Group will beneficially own
approximately % of the Common Stock ( % on a fully diluted basis) or %
( % on a fully diluted basis), assuming that the Underwriters' over-allotment
options are exercised in full. As long as BH Group continues to own in the
aggregate a large percentage of the outstanding shares of Common Stock, BH Group
will have the power to elect the entire Board of Directors of the Company and,
in general, to determine (without the consent of the Company's other
stockholders) the outcome of any corporate transaction or other matter submitted
to the stockholders for approval, including mergers, consolidations and the sale
of all or substantially all of the Company's assets, to prevent or cause a
change in control of the Company, and to approve substantially all amendments to
the Restated Certificate. See "Risk Factors--Principal Stockholders".

CERTAIN ANTI-TAKEOVER MATTERS

The Restated Certificate and By-laws will, upon consummation of the
Offerings, include a number of provisions that may have the effect of
encouraging persons considering unsolicited tender offers or other unilateral
takeover proposals to negotiate with the Board of Directors rather than pursue
non-negotiated takeover attempts. These provisions include:

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<PAGE>
CLASSIFIED BOARD OF DIRECTORS. The Restated Certificate provides for a
Board of Directors divided into three classes, with one class to be elected each
year to serve for a three-year term. As a result, at least two annual meetings
of stockholders may be required for the stockholders to change a majority of the
Board of Directors. In addition, the stockholders of the Company can only remove
directors for cause. The classification of directors and the inability of
stockholders to remove directors without cause will make it more difficult to
change the composition of the Board of Directors, but will promote a continuity
of existing management.

ADVANCE NOTICE REQUIREMENTS. The By-laws establish advance notice
procedures with regard to stockholder proposals relating to the nomination of
candidates for election as directors or new business to be brought before
meetings of stockholders of the Company. These procedures provide that notice of
such stockholder proposals must be timely given in writing to the Secretary of
the Company prior to the meeting at which the action is to be taken. Generally,
to be timely, notice must be received at the principal executive offices of the
Company not less than 60 days nor more than 90 days prior to the meeting. The
notice must contain certain information specified in the By-laws.

SPECIAL MEETINGS OF STOCKHOLDERS. The Restated Certificate and By-laws deny
stockholders the right to call a special meeting of stockholders. The By-laws
provide that special meetings of the stockholders may be called only by the
Company's Chief Executive Officer or a majority of the Board of Directors.

WRITTEN CONSENT OF STOCKHOLDERS. The By-laws require all stockholder
actions to be taken by a vote of the stockholders at an annual or special
meeting, unless the action is approved by a majority of the Board of Directors.
In case of such approval, the action may be taken by written consent of the
number of stockholders otherwise required for approval of such action, subject
to compliance with the notice and other requirements of the Restated Certificate
and By-laws.

AMENDMENT OF BY-LAWS AND CHARTER. The By-laws and the Restated Certificate
require the approval of 66 2/3% of the voting shares for amending any By-law or
those provisions of the Restated Certificate described in this section. These
provisions will make it more difficult to dilute the anti-takeover effects of
the By-laws and Restated Certificate.

BLANK CHECK PREFERRED STOCK. The Restated Certificate provides for
5,000,000 authorized shares of Preferred Stock, none of which has been issued.
The existence of authorized but unissued Preferred Stock may enable the Board of
Directors to render more difficult or to discourage an attempt to obtain control
of the Company by means of a merger, tender offer, proxy contest or otherwise.
For example, if in the due exercise of its fiduciary obligations, the Board of
Directors were to determine that a takeover proposal is not in the Company's
best interests, the Board of Directors could cause shares of Preferred Stock to
be issued without stockholder approval in one or more private offerings or other
transactions that might dilute the voting or other rights of the proposed
acquirer or insurgent stockholder or stockholder group. In this regard, the
Restated Certificate grants the Board of Directors broad power to establish the
rights and preferences of authorized and unissued Preferred Stock. The issuance
of shares of Preferred Stock pursuant to the Board of Directors' authority
described above could decrease the amount of earnings and assets available for
distribution to holders of Common Stock and adversely affect the rights and
powers, including voting rights, of such holders and may have the effect of
delaying, deferring or preventing a change in control of the Company. The Board
of Directors currently does not intend to seek stockholder approval prior to any
issuance of Preferred Stock, unless otherwise required by law.

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LISTING

The Company intends to make an application to list the Common Stock on the
New York Stock Exchange under the symbol " ".

TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar for the Common Stock is [ ]. Its address
is [ ], and its telephone number is [ ].

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DESCRIPTION OF CERTAIN INDEBTEDNESS

ESSEX REVOLVING CREDIT AGREEMENT

In October 1996, Essex International and Essex entered into the Essex
Revolving Credit Agreement with the lenders named therein and The Chase
Manhattan Bank, as Administrative Agent.

Set forth below is a summary of certain terms of the Essex Revolving Credit
Agreement. The summary does not purport to be complete and is subject to, and is
qualified in its entirety by reference to, the Essex Revolving Credit Agreement,
which is included as an exhibit to the Registration Statement of which this
Prospectus is part. For the purposes of the following discussion, capitalized
terms used therein and not otherwise defined have the meanings given to them in
the Essex Revolving Credit Agreement.

GENERAL. The Essex Revolving Credit Agreement provides for up to $370.0
million in revolving loans, subject to specified percentages of eligible assets
and reduced by outstanding borrowings under the Company's Canadian Credit
Agreement and unsecured bank lines of credit. The Essex Revolving Credit
Agreement also provides a $25.0 million letter of credit subfacility and
terminates on October 31, 2001. As of December 31, 1996, the Company had
outstanding borrowings of $179.9 million under the Essex Revolving Credit
Agreement and $61.7 million of undrawn capacity based upon the Borrowing Base at
that time of $272.5 million, reduced by outstanding borrowings under (i) the
Essex Revolving Credit Agreement ($179.9 million), (ii) unsecured bank lines of
credit ($25.0 million) and (iii) the Canadian Credit Agreement ($5.9 million).

The Essex Revolving Credit Agreement is secured by all the capital stock of
Essex and substantially all the Company's assets and real property.

PREPAYMENTS. The Essex Revolving Credit Agreement may be repaid by the
Company at any time without penalty. The Essex Revolving Credit Agreement is
subject to mandatory prepayment if certain amounts outstanding under the Essex
Revolving Credit Agreement exceed the Borrowing Base or the Senior Note
Indenture Revolving Credit Incurrence Limit. At December 31, 1996, the Borrowing
Base was $272.5 million and the Senior Note Indenture Revolving Credit
Incurrence Limit was $269.5 million.

INTEREST RATE. Loans under the Essex Revolving Credit Agreement bear
interest at rates, depending on the type of loan incurred, of (i) adjusted LIBOR
plus a spread based on certain financial ratios, which spread ranges from .75%
to 2.25% or (ii) bank prime plus a spread based on certain financial ratios,
which spread ranges from 0% to 1.25%. The effective interest rate can be reduced
by 0.25% to 1.50%, in 0.25% increments, if certain specified financial
conditions are achieved.

FEES. Commitment fees during the revolving loan period are .25%, .375% or
.5% of the average daily unused portion of the available credit based upon
certain financial ratios. For the purposes of setting the commitment fee and
interest rate spreads, the relevant financial ratios are the Company's Leverage
Ratio and the Company's Interest Coverage Ratio. Based on the combination of
those two ratios, the Company is classified into one of seven levels, with level
one being the most beneficial. For the fourth quarter of 1996, the Company's
Leverage and Interest Coverage Ratios positioned it in level two. The Company's
Leverage Ratio and Interest Coverage Ratio as of December 31, 1996, were 3.07 to
1.00 and 3.73 to 1.00, respectively.

NEGATIVE COVENANTS. The Company is required to maintain a ratio of
Consolidated Current Assets to Consolidated Current Liabilities of 2.00 to 1.00.
As of December 31, 1996, this ratio was 2.45 to 1.00. The Company is required to
maintain Consolidated Net Worth of not less than the sum of, subject to certain
adjustments, (a) $80 million, (b) 50% of the Company's Consolidated Net Income,
(c) 100% of the Net Cash Proceeds of any Common Equity Offering by the Company
and (d) 100% of any capital

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contribution made to the Company by one of its stockholders. As of December 31,
1996, the Company's Consolidated Net Worth was $158.7 million or 152% of that
required to be maintained.

The Essex Revolving Credit Agreement also requires the maintenance of an
Interest Coverage Ratio of not less than 2.00 to 1.00, a Leverage Ratio prior to
March 31, 1998, of not more than 5.00 to 1.00 decreasing to 4.00 to 1.00 by
March 31, 2000, and a Senior Secured Leverage Ratio prior to March 31, 1998, of
not more than 3.00 to 1.00 decreasing to 2.25 to 1.00 by March 31, 2000. As of
December 31, 1996, the Company's Leverage Ratio and Senior Secured Leverage
Ratio were 3.07 to 1.00 and 1.37 to 1.00, respectively.

The Essex Revolving Credit Agreement contains other customary covenants,
including covenants on the incurrence of indebtedness, liens and guarantees,
mergers, sales of assets, lease obligations, investments and, with certain
exceptions, prepayment of indebtedness and transactions with affiliates. Capital
Expenditures are generally limited to $40.0 million per year plus any unspent
carry over from prior years. The Essex Revolving Credit Agreement also restricts
the payment of dividends by Essex to the Company and prohibits the payment of
dividends by Essex International to its stockholders.

EVENTS OF DEFAULT. The Essex Revolving Credit Agreement contains customary
events of default, including a failure to pay principal or interest, a material
inaccuracy of a representation or warranty, a failure to comply with certain
covenants, a default on other indebtedness in excess of $5.0 million, any
Security Document ceasing to be in full force and effect and the entry of
certain unbonded or unstayed judgments or decrees against the Company of $2.0
million or more. In addition, it is an event of default if BH Group beneficially
owns less than 70% of the Common Stock owned by BH Group on the effective date
of the Essex Revolving Credit Agreement or, except in certain circumstances, if
in the aggregate, BH Group, DLJ, the GS Partnerships and certain officers or
employees of the Company have less than 51% of the voting power for the election
of directors of the Company or if a Change of Control (as defined in the Essex
Senior Note Indenture) occurs. In the case of an event of default, all revolving
credit commitments may terminate and all amounts outstanding under the Essex
Revolving Credit Agreement may become due and payable.

SENIOR NOTES

In May 1993, Essex issued $200 million aggregate principal amount of notes
(the "Essex Senior
Notes") pursuant to an indenture (the "Essex Senior Notes Indenture") between
Essex and NBD Bank, National Association, as trustee. Set forth below is a
summary of certain terms of the Essex Senior Note Indenture. The summary does
not purport to be complete and is subject to, and is qualified in its entirety
by reference to, the Essex Senior Note Indenture, which is included as an
exhibit to the Registration Statement of which this Prospectus is part. For the
purposes of the following discussion, capitalized terms used therein and not
otherwise defined have the meanings given to them in the Essex Senior Note
Indenture.

GENERAL. The Essex Senior Notes bear interest at 10% per annum, payable
semiannually and are due in May 2003. The Essex Senior Notes are general
unsecured obligations of Essex limited to $200 million aggregate principal
amount.

REDEMPTION. At the option of the Company, the Essex Senior Notes may be
redeemed, commencing in May 1998, in whole or in part, at redemption prices
ranging from 103.75% in 1998 to 100% in 2001, in each case plus accrued and
unpaid interest.

COVENANTS. The Essex Senior Note Indenture contains customary covenants.
The Essex Senior Notes Indenture restricts the incurrence of Debt by the Company
unless the Company has an EBITDA Coverage Ratio of greater than than 2.0 to 1.0
or unless another exemption is available. At December 31, 1996, the Company had
a 3.73 to 1.0 EBITDA Coverage Ratio. The Essex Senior Notes Indenture also
restricts the issuance of Debt by each of the Company's subsidiaries to the sum
of (i) 50% of the book

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value of such subsidiary's inventory (before giving effect to any LIFO Reserve)
and (ii) 80% of the book value of such subsidiary's accounts receivable (subject
to certain exceptions). At December 31, 1996, Essex could have incurred $269.5
million of Debt under such provision. Dividends, distributions and repurchases
of capital stock also are limited under the Essex Senior Notes Indenture to 50%
of the Company's Consolidated Net Income plus the Net Cash Proceeds of certain
equity issuances. At December 31, 1996, the Company could not have paid any
dividends due to the Limitation on Restricted Payments provision. The Essex
Senior Notes Indenture also restricts the incurrence of secured debt, sale and
leaseback transactions, sales of assets and transactions with affiliates.

EVENTS OF DEFAULT. The Essex Senior Note Indenture contains customary
events of default, including a failure to pay principal or interest, a payment
default with respect to, or the acceleration of, other indebtedness in excess of
$10.0 million, the entry of certain unstayed judgements in excess of $10.0
million and certain events of bankruptcy or insolvency.

CHANGE OF CONTROL. Upon a Change in Control, each holder of the Essex
Senior Notes will have the right to require Essex to repurchase all or any part
of such holder's Senior Notes at a repurchase price equal to 101% of the
principal amount thereof, plus accrued and unpaid interest. "Change of Control"
is defined in the Essex Senior Notes Indenture as (i) the acquisition by any
person (other than BH Group, the GS Partnerships, DLJ and certain other
shareholders) of more than 35% of the Company's Voting Stock or (ii) during any
two-year period, the directors who were on the Company's Board of Directors at
the beginning of such period (and any directors elected by, or whose nomination
was approved by, the Board) ceasing for any reason to constitute a majority of
the Board then in office.

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SHARES ELIGIBLE FOR FUTURE SALE

Upon completion of the Offerings, the Company will have outstanding [ ]
shares of Common Stock. In addition, the Company will have outstanding options
granted under the Stock Option Plan to purchase up to [ ] shares of Common
Stock. All the shares of Common Stock sold in the Offerings will be freely
transferable without restriction or further registration under the Securities
Act, except those shares owned by "affiliates" of the Company (as such term is
defined in Rule 144). The remaining [ ] shares of Common Stock will be
"restricted securities" within the meaning of Rule 144 and may not be sold in
the absence of registration under the Securities Act or an available exemption
therefrom (such as Rule 144). The Company and its directors and executive
officers, certain of its employees, BH Group and the Selling Stockholders have
agreed, subject to certain exceptions, not to sell, offer or agree to sell, or
otherwise dispose of, directly or indirectly, any shares of Common Stock, any
security substantially similar to the Common Stock or any security exchangeable
for, or convertible into, shares of Common Stock or any such substantially
similar security for a period of at least 180 days after the date of this
Prospectus, without the prior written consent of Goldman Sachs. Additionally,
each stockholder (other than BHLP and certain of its affiliates) has agreed not
to sell any of its Common Stock for 90 days after the effective date of the
Registration Statement of which this Prospectus is a part (the "Effective
Date"), pursuant to either the Management Stockholders Agreement or the
Registration Rights Agreement.

In general, under Rule 144 as currently in effect, a stockholder (or
stockholders whose securities are aggregated) who (together with predecessor
holders who were not affiliates) has beneficially owned shares of Common Stock
that are treated as restricted securities for at least two years from the date
such shares were acquired from the Company or an affiliate thereof, is entitled
to sell, within any three-month period, a number of shares that does not exceed
the greater of (i) 1% of the then outstanding shares of Common Stock or (ii) the
average weekly trading volume of the then outstanding shares of Common Stock
during the four calendar weeks preceding the date on which notice of such sale
was filed with the Commission under Rule 144. Sales under Rule 144 are also
subject to certain provisions relating to the manner and notice of sale and the
availability of current public information about the Company. In addition,
affiliates of the Company must comply with the restrictions and requirements of
Rule 144 (other than the two-year holding period requirement) in order to sell
shares of Common Stock that are not restricted securities (such as shares
acquired by affiliates in the public market). Commencing three years after the
acquisition of restricted securities from the Company or an affiliate, a holder
of such restricted securities who is not an affiliate at the time of the sale
and has not been an affiliate for at least three months prior to such sale would
be entitled, pursuant to Rule 144(k), to sell such securities immediately
without regard to the volume limitations and other conditions described above.
In addition, the Commission has proposed revisions to Rule 144 and Rule 144(k),
the effect of which would be to shorten the holding period under Rule 144 from
two years to one year and to shorten the holding period under Rule 144(k) from
three years to two years.

Any employee, officer or director of the Company who acquired his or her
shares prior to the Effective Date at a time when the Company was not subject to
the reporting requirements of Section 13 or 15(d) of the Exchange Act or who
holds vested options as of the Effective Date, pursuant to a written
compensatory plan or contract is entitled to rely on the resale provisions of
Rule 701. Rule 701 permits non-affiliates to sell their Rule 701 shares without
having to comply with the public information, holding period, volume limitation
or notice provisions of Rule 144 and permits affiliates to sell their Rule 701
shares without having to comply with Rule 144's holding period restrictions, in
each case commencing 90 days after the Effective Date.

Excluding the shares of Common Stock offered pursuant to the Offerings, [ ]
shares of Common Stock are outstanding and were sold by the Company in reliance
on exemptions from the registration requirements of the Securities Act and thus
are restricted securities within the meaning of Rule 144. None of these shares
of Common Stock will be eligible for sale in the public market immediately upon
the Effective Date due to "lock-up" provisions in the Registration Rights
Agreement, the Management

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Stockholders Agreement and "lock-up" agreements with the Underwriters. Beginning
90 days after the Effective Date, approximately [ ] of the restricted shares
(including [ ] shares subject to vested options) will become eligible for
sale subject to the provisions of Rule 144 and Rule 701 ([ ] of which will
be eligible, under Rule 144(k), for sale without limitation as to volume or
manner of sale), upon the expiration of agreements not to sell such shares
entered into between the Company and holders of such stock. Beginning 180 days
after the date of this Prospectus, approximately [ ] of the restricted shares
(including [ ] shares subject to vested options) will become eligible for
sale subject to the provisions of Rule 144 and Rule 701 ([ ] of which will
be eligible, under Rule 144(k), for sale without limitation as to volume or
manner of sale), upon the expiration of agreements not to sell such shares
entered into between Underwriters and holders of such stock.

The Company intends to file a Registration Statement on Form S-8 covering
all shares of Common Stock issuable under the Stock Option Plan (an aggregate of
[ ] shares as of the date of this Prospectus). Any shares issued upon
exercise of outstanding options will be eligible for sale in the public market
after the effective date of such Registration Statement, subject to any
contractual restrictions.

In connection with the 1996 Private Offering, the Company issued 6,367,708.5
shares of Common Stock. All such shares are restricted securities. Pursuant to
Rule 144, 5,930,000 shares will be available for sale in the public market,
subject to the restrictions of Rule 144, on July 3, 1998, and the remaining
437,708.5 shares will be available for sale in the public market, subject to the
restrictions of Rule 144, on December 27, 1998.

In addition, during fiscal 1996, the Company issued options to certain
employees under the Stock Option Plan to purchase approximately 462,500 shares
of Common Stock. All such options are subject to a vesting schedule that
provides for vesting (i) in full on the third anniversary of the date the
options were granted, (ii) in full upon the death, retirement or disability of
the optionee and (iii) in part, upon certain sales of Common Stock by
significant stockholders. See "Management--Stock Option Plan".

On January 30, 1997, the Company issued options to certain employees under
the Stock Option Plan to purchase approximately 730,000 shares of Common Stock.
Such options were granted in connection with the Company's 1996 performance and
to maintain management's equity interest in the Company as a result of the
increase in total Common Stock outstanding following the 1996 Private Offering.
All such options are subject to a vesting schedule that provides for vesting (i)
in full on the first anniversary of the date the options were granted, (ii) in
full upon the death, retirement or disability of the optionee and (iii) in part,
upon certain sales of Common Stock by significant stockholders. See
"Management--Stock Option Plan".

Prior to the Offerings, there has been no market for the Common Stock, and
no prediction can be made as to the effect, if any, that future public sales of
shares or the availability of shares for future sale, will have on the market
price prevailing from time to time. Nevertheless, sales of substantial amounts
of Common Stock in the public market, or the perception that such sales could
occur, could have an adverse impact on the market price of the Common Stock and
could impair the Company's future ability to raise capital through the sale of
equity securities.

As a result of the ability of BH Group, the GS Partnerships and DLJ to
require the Company to register any or all of their shares in certain
circumstances means that all their [ ] shares of Common Stock could be available
for sale in the public market as early as 180 days after the date of this
Prospectus. While shareholders subject to the Management Shareholders Agreement
do not have demand registration rights thereunder, their ability to piggyback on
other registered offerings means that all their [ ] shares of Common Stock could
be available for sale in the public market as early as 180 days after the date
of this Prospectus.

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REGISTRATION RIGHTS

BH GROUP

Pursuant to the Management Stockholders Agreement, BH Group has the right to
require that the Company register any or all of its shares of Common Stock in a
registered offering pursuant to the Securities Act. Expenses, other than
underwriters discounts and commissions, incurred in connection with such
registration are to be paid by the Company. The Company also is required to
indemnify BH Group against certain liabilities, including liabilities arising
under the Securities Act. BH Group is not restricted in the number of times it
may require the Company to register its shares of Common Stock.

Pursuant to a Registration Rights Agreement to be entered into prior to the
Offerings (the "BH Group Registration Rights Agreement"), between BH Group and
the Company, BH Group will have the right to require the Company, at the
Company's expense, to prepare and file with the SEC and keep continuously
effective, a "shelf" registration statement covering offers and sales in
accordance with Rule 415 of the Securities Act, or any similar rule that may be
adopted by the SEC, that covers some or all of BH Group's Common Stock. The
Company also will be required to indemnify BH Group against certain liabilities,
including liabilities arising under the Securities Act.

After the consummation of the Offerings, it is expected that the BH Group
Registration Rights Agreement will cover [ ] shares of Common Stock.

OTHER INITIAL SHAREHOLDERS

In connection with the Acquisition, DLJ, the GS Partnerships and CEA
(together with certain transferees, the "Other Initial Shareholders") entered
into a Registration Rights Agreement with the Company (the "Registration Rights
Agreement"). Set forth below is a summary of certain terms of the Registration
Rights Agreement. The summary does not purport to be complete and is subject to,
and is qualified in its entirety by reference to, the Registration Rights
Agreement, which is filed as an exhibit to the Registration Statement of which
this Prospectus is a part.

DEMAND REGISTRATION RIGHTS. Pursuant to the Registration Rights Agreement,
the GS Partnerships and DLJ each have the ability to require (a "Demand") the
Company to register any or all of the shares of Common Stock held by it in a
public offering pursuant to the Securities Act. The GS Partnerships
(collectively) and DLJ each have the right to make two Demands plus an
additional Demand where the offering includes 10% of the Common Shares
outstanding immediately after the Acquisition having an aggregate offering price
of at least $35 million. Under certain circumstances, the number of shares and
aggregate price requirements discussed in the immediately preceding sentence can
be reduced to 7.5% of the Common Stock outstanding immediately after the
Acquisition having an aggregate offering price of at least $26.25 million.
Demand registrations are subject to the right of the managing underwriter to
restrict the size of the registration if the number of shares requested to be
sold could not be sold within a price range acceptable to the selling
stockholders.

PIGGYBACK REGISTRATION RIGHTS. Pursuant to the Registration Rights
Agreement, the GS Partnerships, DLJ and CEA, together with certain of their
transferees, have the right to "piggyback" or include their Common Stock in any
registration of Common Stock made by the Company, subject to the right of the
managing underwriter to restrict the size of the registration if the number of
shares requested to be sold by the piggyback stockholders would have an adverse
effect on the offering.

EXPENSES. Expenses, other than underwriters discounts and commissions,
incurred in connection with such Demand or piggyback registration pursuant to
the Registration Rights Agreement are to be paid by the Company. The Company
also has agreed to indemnify the GS Partnerships, DLJ and CEA against certain
liabilities, including those arising under the Securities Act.

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MARKET MAKING PROSPECTUS. The Registration Rights Agreement provides that,
at the request of Goldman Sachs or DLJSC, the Company shall, at its expense,
file a registration statement in connection with the market-making activities of
Goldman Sachs or DLJSC.

SHARES COVERED. After the consummation of the Offerings, the Demand
registration rights in the Registration Rights Agreement will cover [ ] shares
of Common Stock and the "piggyback" rights in such agreement will cover such
shares plus an additional [ ] shares of Common Stock.

PIGGYBACK REGISTRATION RIGHTS

Pursuant to the Management Stockholders Agreement, Management Stockholders
have the right to "piggyback" or include their Common Stock in any registration
of Common Stock (i) demanded by BH Group (unless the Company is contractually
prohibited from granting such piggyback rights) or (ii) for a primary offering
by the Company (other than any registration relating to employee benefit or
similar plans or acquisitions of companies by the Company), subject to the right
of the managing underwriter to restrict the size of the registration if the
number of shares requested to be sold by Management Stockholders would have an
adverse effect on the offering. Expenses, other than underwriters discounts and
commissions, incurred in connection with the piggyback registration are to be
paid by the Company.

After the consummation of the Offerings, the "piggyback" rights in the
Management Stockholders Agreement will cover [ ]shares of Common Stock (on a
fully diluted basis).

CERTAIN UNITED STATES FEDERAL TAX CONSEQUENCES
TO NON-UNITED STATES HOLDERS OF COMMON STOCK

GENERAL

The following is a general discussion of United States Federal income and
estate tax consequences of the ownership and disposition of Common Stock by a
holder who is not a United States person (a "Non-U.S. Holder"), as defined
below. This discussion does not address all aspects of United States Federal
income and estate taxes and does not address any foreign, state or local tax
consequences. Furthermore, this discussion is based on provisions of the
Internal Revenue Code of 1986, as amended (the "Code"), existing, temporary and
proposed regulations promulgated thereunder and administrative and judicial
interpretations thereof, all as in effect or proposed on the date hereof and all
of which are subject to change, possibly with retroactive effect, or different
interpretations. Each prospective purchaser of Common Stock is advised to
consult a tax advisor with respect to current and possible future U.S. Federal
income and estate tax consequences of holding and disposing of Common Stock as
well as any tax consequences that may arise under the laws of any state, local,
foreign or other taxing jurisdiction. For purposes of this summary, a "U.S.
Holder" with respect to Common Stock is (i) an individual who is a citizen or
resident of the United States, (ii) a corporation or other entity taxable as a
corporation created or organized in the United States or under the laws of the
United States or of any state thereof (including the District of Columbia),
(iii) an estate or trust the income of which is includable in gross income for
United States Federal income tax purposes regardless of its source, or (iv) a
person otherwise subject to United States Federal income taxation with respect
to income from the Common Stock on a net income basis; and a "Non-U.S. Holder"
is any person or entity other than a U.S. Holder.

DISTRIBUTIONS

Distributions on the shares of Common Stock (other than distributions in
redemption of the shares of Common Stock subject to section 302(b) of the Code)
will constitute dividends for Federal income tax purposes to the extent paid
from current or accumulated earnings and profits of the Company (as determined
under Federal income tax principles). Dividends paid to a Non-U.S. Holder of
Common Stock that are not effectively connected with a U.S. trade or business of
the Non-U.S. Holder will be

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subject to United States withholding tax at a 30% rate or such lower rate as may
be specified by an applicable income tax treaty. Moreover, under United States
Treasury regulations which are currently in effect, withholding is generally
imposed on the gross amount of the distribution, without regard to whether the
corporation has sufficient earnings and profits to cause the distribution to be
a dividend for Federal income tax purposes. Dividends that are effectively
connected with the conduct of a trade or business within the United States or,
if a tax treaty applies, are attributable to a U.S. permanent establishment of
the non-U.S. Holder, are exempt from United States Federal withholding tax but
are subject to United States Federal income tax on a net income basis at
applicable graduated individual or corporate rates. Any such dividends
effectively connected with the conduct of a trade or business within the U.S. or
attributable to a U.S. permanent establishment received by a foreign corporation
may, under certain circumstances, be subject to an additional "branch profits
tax" at a 30% rate or such lower rate as may be specified by an applicable
income tax treaty. Certain certification and disclosure requirements must be
complied with in order to be exempt from withholding under the effectively
connected income or permanent establishment exemptions.

Under current United States Treasury regulations, dividends paid to an
address outside the United States are presumed to be paid to a resident of such
country for purposes of the withholding discussed above, and, under the current
interpretation of United States Treasury regulations, for purposes of
determining the applicability of a tax treaty rate. Under proposed United States
Treasury regulations (the "Proposed Regulations") not currently in effect,
however, a Non-U.S. Holder of Common Stock would be required to satisfy
applicable certification and other requirements to qualify for withholding at an
applicable treaty rate. The Proposed Regulations would require a Non-U.S. Holder
to file a beneficial owner withholding certificate, e.g., a Form W-8, to obtain
the lower treaty rate. In addition, under the Proposed Regulations, in the case
of Common Stock held by a foreign partnership, (x) the certification requirement
would generally be applied to the partners of the partnership and (y) the
partnership would be required to provide certain information, including a United
States taxpayer identification number. The Proposed Regulations also provide
look-through rules for tiered partnerships. The Proposed Regulations would apply
to dividends paid after December 31, 1997, subject to certain transitional
rules. It is not certain whether, or in what form, the Proposed Regulations will
be adopted as final regulations.

A Non-U.S. Holder of Common Stock may obtain a refund of any excess amounts
withheld by filing an appropriate claim for refund with the Internal Revenue
Service (the "IRS").

GAIN ON DISPOSITION OF COMMON STOCK

A Non-U.S. Holder will generally not be subject to United States Federal
income tax with respect to gain recognized on a sale or other disposition of
Common Stock unless (i) the gain is effectively connected with a trade or
business of the Non-U.S. Holder in the United States, (ii) in the case of a Non-
U.S. Holder who is an individual and holds Common Stock as a capital asset, such
holder is present in the United States for 183 or more days in the taxable year
of the sale or other disposition and certain other conditions are met, or (iii)
the Company is or has been a "U.S. real property holding corporation" for United
States Federal income tax purposes at any time during the five-year period
ending on the date of the disposition, or, if shorter, the period during which
the Non-U.S. Holder held the Common Stock (the "applicable period"), and the
Non-U.S. Holder owns, actually or constructively, at any time during the
applicable period more than five percent of the Common Stock. The Company
believes that it is not currently a "U.S. real property holding corporation" for
Federal income tax purposes.

FEDERAL ESTATE TAX

Common Stock held by an individual Non-U.S. Holder at the time of death will
be included in such holder's gross estate for United States Federal estate tax
purposes, unless an applicable estate tax treaty provides otherwise.

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INFORMATION REPORTING AND BACKUP WITHHOLDING TAX

Under Treasury regulations, the Company must report annually to the IRS and
to each Non-U.S. Holder the amount of dividends paid to such holder and the tax
withheld with respect to such dividends. These information reporting
requirements apply even if withholding was not required because the dividends
were effectively connected with a U.S. trade or business in the United States of
the Non-U.S. Holder or withholding was reduced or eliminated by an applicable
income tax treaty. Copies of the information returns reporting such dividends
and withholding may also be made available to the tax authorities in the country
in which the Non-U.S. Holder resides under the provisions of an applicable
income tax treaty.

Backup withholding (which generally is a withholding tax imposed at the rate
of 31% on certain payments to persons that fail to furnish certain information
under the United States information reporting requirements) will generally not
apply to dividends paid to Non-U.S. Holders that either are subject to the U.S.
withholding tax, whether at 30% or a reduced treaty rate, or that are exempt
from such withholding because such dividends constitute effectively connected
income. See discussion under "Distributions" above for rules regarding Proposed
Regulations reporting requirements to avoid backup withholding. As a general
matter, information reporting and backup withholding will not apply to a payment
by or through a foreign office of a foreign broker of the proceeds of a sale of
Common Stock effected outside the United States. However, information reporting
requirements (but not backup withholding) will apply to a payment by or through
a foreign office of a broker of the proceeds of a sale of Common Stock effected
outside the United States where that broker (i) is a United States person, (ii)
is a foreign person that derives 50% or more of its gross income for certain
periods from the conduct of a trade or business in the United States or (iii) is
a "controlled foreign corporation" as defined in the Code (generally, a foreign
corporation controlled by certain United States shareholders), unless the broker
has documentary evidence in its records that the holder is a Non-U.S. Holder and
certain conditions are met or the holder otherwise establishes an exemption.
Payment by a United States office of a broker of the proceeds of a sale of
Common Stock is subject to both backup withholding and information reporting
unless the holder certifies to the payor in the manner required as to its
non-United States status under penalties of perjury or otherwise establishes an
exemption.

Amounts withheld under the backup withholding rules do not constitute a
separate United States Federal income tax. Rather, any amounts withheld under
the backup withholding rules will be refunded or allowed as a credit against the
holder's United States Federal income tax liability, if any, provided the
required information or appropriate claim for refund is filed with the IRS.

THE FOREGOING DISCUSSION IS A SUMMARY OF THE PRINCIPAL UNITED STATES FEDERAL
INCOME AND ESTATE TAX CONSEQUENCES OF THE OWNERSHIP, SALE OR OTHER DISPOSITION
OF THE COMMON STOCK BY NON-UNITED STATES HOLDERS. ACCORDINGLY, INVESTORS ARE
URGED TO CONSULT WITH THEIR TAX ADVISORS WITH RESPECT TO THE UNITED STATES
FEDERAL INCOME TAX CONSEQUENCES OF THE OWNERSHIP AND DISPOSITION OF COMMON STOCK
INCLUDING THE APPLICATION AND EFFECT OF THE LAWS OF ANY STATE, LOCAL, FOREIGN OR
OTHER TAXING JURISDICTION.

VALIDITY OF COMMON STOCK

The validity of the shares of Common Stock offered hereby will be passed
upon for the Company by Cravath, Swaine & Moore, New York, New York and for the
Underwriters by Sullivan & Cromwell, New York, New York.

EXPERTS

The consolidated financial statements of the Company at December 31, 1995
and 1996, and for each of the three years in the period ended December 31, 1996,
appearing in this Prospectus and

67
<PAGE>
Registration Statement have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report thereon appearing elsewhere herein, and
are included in reliance upon such report given upon the authority of such firm
as experts in accounting and auditing.

AVAILABLE INFORMATION

The Company has filed with the Securities and Exchange Commission (the
"Commission"), Washington, D.C. 20549, a registration statement on Form S-1 (the
"Registration Statement") pursuant to the Securities Act of 1933 (the
"Securities Act"), covering the Common Stock offered hereby. This Prospectus
does not contain all of the information set forth in the Registration Statement.
Certain parts are omitted in accordance with the rules and regulations of the
Commission. For further information with respect to the Company and the Common
Stock offered hereby, reference is made to the Registration Statement and the
exhibits and schedules filed as a part thereof. Statements made in this
Prospectus as to the contents of any contract, agreement or other document are
summaries of the material terms of such contract, agreement or document. With
respect to each such contract, agreement or other document filed as an exhibit
to the Registration Statement, reference is made to the exhibit for a more
complete description of the matter involved. The Registration Statement
(including the exhibits and schedules thereto) filed with the Commission by the
Company may be inspected and copied (as prescribed rates) at the public
reference facilities maintained by the Commission at 450 Fifth Street, N.W.,
Room 1024, Washington, D.C. 20549, and at the regional offices of the Commission
maintained at Seven World Trade Center, 13th Floor, New York, New York 10048 and
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661,
or through the World Wide Web (http:// www.sec.gov). The Commission maintains a
web site at http://www.sec.gov that contains reports, proxy and information
statements and other information regarding registrants that file electronically
with the Commission.

The Company is not currently subject to the informational requirements of
the Securities Exchange Act of 1934 (the "Exchange Act"). As a result of the
Offerings, the Company will become subject to the informational requirements of
the Exchange Act. The Company will fulfill its obligations with respect to such
requirements by filing periodic reports with the Commission. In addition, the
Company will furnish its stockholders with annual reports containing audited
financial statements certified by its independent public accountants and
quarterly reports for the first three quarters of each fiscal year containing
unaudited summary financial information.

68
<PAGE>
INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
BCP/ESSEX HOLDINGS INC.

<S> <C>
Report of Independent Auditors..................................................... F-2

Consolidated Balance Sheets as of December 31, 1996 and 1995....................... F-3

Consolidated Statements of Income for each of the three years in the period ended
December 31, 1996................................................................ F-4

Consolidated Statements of Cash Flows for each of the three years in the period
ended December 31, 1996.......................................................... F-5

Notes to Consolidated Financial Statements......................................... F-6
</TABLE>

F-1
<PAGE>
REPORT OF INDEPENDENT AUDITORS

The Board of Directors
BCP/Essex Holdings Inc.

We have audited the accompanying consolidated balance sheets of BCP/Essex
Holdings Inc. as of December 31, 1996 and 1995 and the related consolidated
statements of income and cash flows for each of the three years in the period
ended December 31, 1996. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of BCP/Essex
Holdings Inc. at December 31, 1996 and 1995 and the consolidated results of
their operations and their cash flows for each of the three years in the period
ended December 31, 1996 in conformity with generally accepted accounting
principles.

Ernst & Young LLP

Indianapolis, Indiana
January 28, 1997, except for Note 13,
as to which the date is , 1997.

The foregoing report is in the form that will be signed upon the completion
of the recapitalization described in Note 13 to the consolidated financial
statements.

/S/ ERNST & YOUNG LLP

Indianapolis, Indiana
February 19, 1997

F-2
<PAGE>
BCP/ESSEX HOLDINGS INC.

CONSOLIDATED BALANCE SHEETS
IN THOUSANDS OF DOLLARS

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------
<S> <C> <C>
1995 1996
--------- ---------
ASSETS
Current assets:
Cash and cash equivalents.......................................... $ 3,195 $ 4,429
Accounts receivable (net of allowance of $3,930 and $5,239)........ 154,584 189,717
Inventories........................................................ 166,076 217,643
Other current assets............................................... 10,545 12,147
--------- ---------
Total current assets............................................. 334,400 423,936

Property, plant and equipment, net................................... 270,546 280,489
Excess of cost over net assets acquired (net of accumulated
amortization of $13,221 and $17,388)............................... 129,943 126,619
Other intangible assets and deferred costs (net of accumulated
amortization of $3,102 and $4,501)................................. 9,187 7,417
Other assets......................................................... 1,987 4,294
--------- ---------
$ 746,063 $ 842,755
--------- ---------
--------- ---------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable to bank.............................................. $ 11,760 $ 30,913
Current portion of long-term debt.................................. 24,734 11,576
Accounts payable................................................... 66,797 71,243
Accrued liabilities................................................ 44,598 63,346
Deferred income taxes.............................................. 15,345 15,151
--------- ---------
Total current liabilities........................................ 163,234 192,229

Long-term debt....................................................... 388,016 421,340
Deferred income taxes................................................ 66,809 58,043
Other long-term liabilities.......................................... 10,081 12,427

Redeemable preferred stock........................................... 48,820 --
Common stock subject to put.......................................... 4,803 12,626
Other stockholders' equity:
Common stock....................................................... 168 228
Additional paid in capital......................................... 85,779 133,526
Carryover of Predecessor basis..................................... (15,259) (15,259)
Retained earnings (deficit)........................................ (6,388) 27,595
--------- ---------
Total other stockholders' equity................................. 64,300 146,090
--------- ---------
$ 746,063 $ 842,755
--------- ---------
--------- ---------
</TABLE>

See Notes to Consolidated Financial Statements

F-3
<PAGE>
BCP/ESSEX HOLDINGS INC.

CONSOLIDATED STATEMENTS OF INCOME

IN THOUSANDS OF DOLLARS, EXCEPT FOR
SHARE DATA

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------------
1994 1995 1996
---------- -------------- ----------
<S> <C> <C> <C>
Net sales........................................ $1,010,075 $ 1,201,650 $1,332,049
Cost of goods sold............................... 846,611 1,030,511 1,102,460
Selling and administrative expenses.............. 85,209 93,401 121,054
Other expense, net............................... 1,114 1,032 2,045
---------- -------------- ----------
Income from operations........................... 77,141 76,706 106,490

Interest expense................................. 60,155 49,055 39,994
---------- -------------- ----------
Income before income taxes and extraordinary
charge......................................... 16,986 27,651 66,496
Provision for income taxes....................... 9,500 14,380 28,988
---------- -------------- ----------
Income before extraordinary charge............... 7,486 13,271 37,508
Extraordinary charge--debt retirement, net of
income tax benefit............................. -- 2,971 1,183
---------- -------------- ----------

Net income....................................... $ 7,486 $ 10,300 $ 36,325
---------- -------------- ----------
---------- -------------- ----------

Net income....................................... $ 7,486 $ 10,300 $ 36,325
Preferred stock redemption premium............... -- -- (4,185)
Preferred stock dividend requirement............. (6,008) (6,962) (4,248)
Accretion of preferred stock..................... (687) (703) (2,024)
---------- -------------- ----------
Net income applicable to common stock............ $ 791 $ 2,635 $ 25,868
---------- -------------- ----------
---------- -------------- ----------
Income per share:
Income before extraordinary charge............... $ $ $
Extraordinary charge............................. --
---------- -------------- ----------
Net income....................................... $ $ $
---------- -------------- ----------
---------- -------------- ----------
</TABLE>

See Notes to Consolidated Financial Statements

F-4
<PAGE>
BCP/ESSEX HOLDINGS INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

IN THOUSANDS OF DOLLARS

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------------
1994 1995 1996
--------- --------- ---------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net income.............................................. $ 7,486 $ 10,300 $ 36,325
Adjustments to reconcile net income to cash provided by
operating activities:
Depreciation and amortization......................... 31,420 34,205 33,944
Non cash interest expense............................. 38,813 16,466 1,935
Non cash pension expense.............................. 2,328 1,947 3,021
Provision for losses on accounts receivable........... 1,332 676 1,175
Provision (benefit) for deferred income taxes......... (8,388) 486 (7,417)
Loss on disposal of property, plant and equipment..... 1,354 2,610 1,679
Loss on repurchase of debt............................ 187 4,951 1,971
Changes in operating assets and liabilities:
(Increase) decrease in accounts receivable.......... (27,160) (10,665) 6,288
(Increase) decrease in inventories.................. (4,515) 3,762 (16,109)
Increase in accounts payable and accrued
liabilities....................................... 6,837 15,193 6,531
Net (increase) decrease in other assets and
liabilities....................................... (8,022) 9,823 (4,762)
--------- --------- ---------
NET CASH PROVIDED BY OPERATING ACTIVITIES........... 41,672 89,754 64,581
--------- --------- ---------
INVESTING ACTIVITIES
Additions to property, plant and equipment.............. (30,109) (28,555) (25,569)
Proceeds from disposal of property, plant and
equipment............................................. 227 2,419 533
Acquisitions............................................ -- (24,934) (79,395)
Other investments....................................... (236) (459) (285)
Issuance of equity interest in a subsidiary............. -- 1,063 --
--------- --------- ---------
NET CASH USED FOR INVESTING ACTIVITIES.............. (30,118) (50,466) (104,716)
--------- --------- ---------
FINANCING ACTIVITIES
Proceeds from long term debt............................ 106,000 428,390 493,900
Repayment of long term debt............................. (106,396) (215,640) (473,734)
Proceeds from notes payable to banks.................... -- 160,030 537,550
Repayment of notes payable to banks..................... -- (148,270) (518,397)
Repurchase of debentures................................ (4,745) (272,850) --
Debt issuance costs..................................... -- (4,691) (2,350)
Proceeds from exercised stock options................... 21 -- --
Preferred stock redemption.............................. -- -- (59,277)
Common stock issuance................................... -- -- 63,677
--------- --------- ---------
NET CASH PROVIDED BY (USED FOR) FINANCING
ACTIVITIES........................................ (5,120) (53,031) 41,369
--------- --------- ---------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS...... 6,434 (13,743) 1,234
Cash and cash equivalents at beginning of year............ 10,504 16,938 3,195
--------- --------- ---------
Cash and cash equivalents at end of year.................. $ 16,938 $ 3,195 $ 4,429
--------- --------- ---------
--------- --------- ---------
</TABLE>

See Notes to Consolidated Financial Statements

F-5
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(IN THOUSANDS OF DOLLARS, EXCEPT PER
SHARE DATA)

NOTE 1 ACQUISITIONS AND SIGNIFICANT ACCOUNTING POLICIES

ACQUISITION OF ESSEX AND THE COMPANY

On February 29, 1988, MS/Essex Holdings Inc. ("Predecessor" or "the
Company"), acquired Essex Group, Inc. ("Essex") from United Technologies
Corporation ("UTC") (the "1988 Acquisition"). The outstanding common stock of
the Company was beneficially owned by The Morgan Stanley Leveraged Equity Fund
II, L.P., certain directors and members of management of the Company and Essex,
and others.

On October 9, 1992, the Company was acquired (the "Acquisition") by merger
(the "Merger") of BE Acquisition Corporation ("BE") with and into the Company
with the Company surviving under the name BCP/Essex Holdings Inc. ("Successor"
or "the Company"). BE was a newly organized Delaware corporation formed for the
purpose of effecting the Acquisition. Shareholders of BE included Bessemer
Holdings, L.P. (an affiliate and successor in interest to Bessemer Capital
Partners, L.P. ("BHLP")), management and other employees of Essex and certain
other investors. As a result of the Merger, the stockholders of BE became
stockholders of the Company. The effects of the Acquisition and Merger resulted
in a new basis of accounting reflecting estimated fair values for assets and
liabilities as of October 1, 1992. However, to the extent that the Company's
management had a continuing investment interest in the Company's common stock,
such fair values and contributed stockholders' equity (denoted as carryover of
Predecessor basis on the Consolidated Balance Sheets) were reduced
proportionately to reflect the continuing interest (approximately 10%) at the
prior historical cost basis.

ACQUISITION OF BUSINESS

On October 31, 1996, Essex acquired substantially all of the assets and
certain liabilities of Triangle Wire and Cable, Inc. of Lincoln, Rhode Island
and its Canadian affiliate, FLI Royal Wire and Cable ("Triangle"), related to
the sales, marketing, manufacturing and distribution of electrical wire and
cable. The acquisition included four manufacturing facilities which produce a
broad range of building and industrial wire and cable. The total purchase price
for the net assets of Triangle, including acquisition costs, was $71,764. The
acquisition was financed from proceeds received under Essex' revolving credit
agreement.

The acquisition was recorded under the purchase method of accounting and
accordingly, the results of operations of Triangle for the two-month period
ended December 31, 1996 are included in the accompanying consolidated financial
statements. The purchase price has been allocated to assets acquired and
liabilities assumed based on their respective fair values at the date of
acquisition. The allocation of the purchase price, which is preliminary, is
summarized as follows:

<TABLE>
<S> <C>
Current assets.................................................... $ 73,343
Property, plant and equipment..................................... 14,181
Current liabilities............................................... (17,304)
Deferred taxes.................................................... 1,544
---------
$ 71,764
---------
---------
</TABLE>

F-6
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 1 ACQUISITIONS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
The following unaudited pro forma consolidated financial information for the
Company for 1995 and 1996 are presented assuming the acquisition had occurred on
January 1, 1995:

<TABLE>
<CAPTION>
1995 1996
---------- ----------
<S> <C> <C>
Net sales.......................................... $1,505,196 $1,561,224
Income before extraordinary charge................. 11,809 40,049
Net income......................................... 8,838 38,866
Net income per share............................... $ $
</TABLE>

The pro forma consolidated financial information does not purport to present
what the Company's consolidated results of operations would actually have been
if the acquisition had occurred on January 1, 1995 and is not intended to
project future results of operations.

CONSOLIDATION

The consolidated financial statements include the accounts of the Company
and its wholly-owned subsidiary Essex and Essex' majority-owned subsidiaries.
All intercompany accounts and transactions have been eliminated. The Company is
a holding company with no operations and has virtually no assets other than its
ownership of all the outstanding stock of Essex.

USE OF ESTIMATES

The consolidated financial statements were prepared in conformity with
generally accepted accounting principles thereby requiring management to make
estimates and assumptions that affect the amounts reported in the consolidated
financial statements and accompanying notes. Actual results could differ from
those estimates.

NATURE OF OPERATIONS

The Company, through Essex, operates in one industry segment. Essex
develops, manufactures and markets electrical wire and cable and insulation
products. Essex' principal products in order of revenue are: building wire for
the construction industry; magnet wire for electromechanical devices such as
motors, transformers and electrical controls; voice and data communication wire
and cable; automotive wire and specialty wiring assemblies for automobiles and
trucks; and industrial wire for applications in construction, appliances and
recreational vehicles. Essex' customers are principally located throughout the
United States, without significant concentration in any one region or any one
customer. Essex performs periodic credit evaluations of its customers' financial
condition and generally does not require collateral.

CASH AND CASH EQUIVALENTS

All highly liquid investments with a maturity of three months or less at the
date of purchase are considered to be cash equivalents.

INVENTORIES

Inventories are stated at cost, determined principally on the last-in,
first-out ("LIFO") method, which is not in excess of market.

PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment are recorded at cost and depreciated over
estimated useful lives using the straight-line method.

F-7
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 1 ACQUISITIONS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
INVESTMENTS IN JOINT VENTURE

Investments in joint ventures are stated at cost adjusted for the Company's
share of undistributed earnings or losses.

EXCESS OF COST OVER NET ASSETS ACQUIRED

Excess of cost over net assets acquired primarily represents the excess of
the Company's purchase price over the fair value of the net assets acquired in
the Acquisition, and is being amortized by the straight-line method over 35
years. The Company's excess of cost over net assets acquired is assessed for
potential impairment whenever existing facts and circumstances indicate the
carrying value of those assets may not be recoverable. The assessment process
consists of estimating the future undiscounted cash flows of the businesses for
which the excess of cost over net assets acquired relates and comparing the
resultant amount to their carrying value to determine if an impairment has
occurred. If an impairment has occurred, an impairment loss would be recognized
for the excess of the carrying value over the fair value, as measured on a
discounted cash flow basis, of the excess of cost over net assets acquired.

OTHER INTANGIBLE ASSETS AND DEFERRED COSTS

Other intangible assets and deferred costs consist primarily of deferred
debt issuance costs and are being amortized over the lives of the applicable
debt instruments using the straight line or bonds outstanding method and charged
to operations as additional interest expense.

OTHER LONG-TERM LIABILITIES

Other long-term liabilities consist primarily of accrued liabilities under
the Essex sponsored defined benefit pension plans for salaried and hourly
employees and the supplemental executive retirement plan.

RECOGNITION OF REVENUE

Substantially all revenue is recognized at the time the product is shipped.

NET INCOME PER SHARE

Per share data is computed based upon the weighted average number of common
and common equivalent shares outstanding for all periods presented. Common
equivalent shares include outstanding stock options and warrants. Common
equivalent shares are not included in the per share calculation where the effect
of their inclusion would be antidilutive, except that, in accordance with the
Securities and Exchange Commission requirements, common and common equivalent
shares issued during the twelve-month period immediately preceding the filing of
the proposed initial public offering have been included in the calculation of
income per common and common equivalent share as if they were outstanding for
all periods, using the treasury stock method and an assumed initial public
offering price.

RECLASSIFICATION

Certain 1994 and 1995 amounts have been reclassified to conform with the
current year presentation.

F-8
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 2 INVENTORIES

The components of inventories are as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------
<S> <C> <C>
1995 1996
--------- ---------
Finished goods........................................ $ 146,821 $ 171,213
Raw materials and work in process..................... 52,366 56,840
--------- ---------
199,187 228,053
LIFO reserve.......................................... (33,111) (10,410)
--------- ---------
$ 166,076 $ 217,643
--------- ---------
--------- ---------
</TABLE>

Principal elements of cost included in inventories are copper, other
purchased materials, direct labor and manufacturing overhead. Inventories valued
using the LIFO method amounted to $161,449 and $210,454 at December 31, 1995 and
1996, respectively.

NOTE 3 PROPERTY, PLANT AND EQUIPMENT

The components of property, plant and equipment are as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------
<S> <C> <C>
1995 1996
--------- ---------
Land.................................................. $ 8,877 $ 9,386
Buildings and improvements............................ 87,704 95,600
Machinery and equipment............................... 240,257 272,621
Construction in process............................... 18,049 14,990
--------- ---------
354,887 392,597
Less accumulated depreciation......................... 84,341 112,108
--------- ---------
$ 270,546 $ 280,489
--------- ---------
--------- ---------
</TABLE>

NOTE 4 ACCRUED LIABILITIES

Accrued liabilities include the following:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------
<S> <C> <C>
1995 1996
--------- ---------
Salaries, wages and employee benefits.................... $ 15,566 $ 20,271
Amounts due customers.................................... 5,860 11,381
Other.................................................... 23,172 31,694
--------- ---------
$ 44,598 $ 63,346
--------- ---------
--------- ---------
</TABLE>

F-9
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 5 NOTES PAYABLE AND LONG-TERM DEBT

Notes payable consist of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------
<S> <C> <C>
1995 1996
--------- ---------
Bank lines of credit..................................... $ 11,760 $ 25,000
Canadian credit facility................................. -- 5,913
--------- ---------
$ 11,760 $ 30,913
--------- ---------
--------- ---------
</TABLE>

Long-term debt consists of the following:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------
<S> <C> <C>
1995 1996
--------- ---------
10% Senior notes...................................... $ 200,000 $ 200,000
Revolving loan........................................ 135,000 179,900
Term loan............................................. 54,000 31,766
Lease obligation...................................... 23,750 21,250
--------- ---------
412,750 432,916
Less current portion.................................. 24,734 11,576
--------- ---------
$ 388,016 $ 421,340
--------- ---------
--------- ---------
</TABLE>

ESSEX BANK FINANCING

In connection with the Triangle acquisition, Essex terminated its former
revolving credit agreement dated as of April 12, 1995 (the "Former Essex
Revolving Credit Agreement") and entered into a new revolving credit agreement,
dated October 31, 1996, by and among Essex, the Company, the Lenders named
therein, and The Chase Manhattan Bank, as administrative agent (the "Essex
Revolving Credit Agreement"). The Essex Revolving Credit Agreement expires in
2001 and provides for up to $370,000 in revolving loans, subject to specified
percentages of eligible assets, reduced by outstanding borrowings under Essex'
Canadian credit agreement and unsecured bank lines of credit ($5,913 and
$25,000, respectively, at December 31, 1996), as described below. Essex
recognized an extraordinary charge of $1,183 ($1,971 before applicable income
tax benefit) in 1996 for the write-off of unamortized deferred debt expense
associated with the termination of the Former Essex Revolving Credit Agreement.
Essex Revolving Credit Agreement loans bear floating rates of interest, at
Essex' option, at bank prime plus 1.25% or a reserve adjusted Eurodollar rate
(LIBOR) plus 2.25%. The effective interest rate can be reduced by 0.25% to
1.50%, in 0.25% increments, if certain specified financial conditions are
achieved. Commitment fees during the revolving loan period are .250%, .375% or
.5% of the average daily unused portion of the available credit based upon
certain specified financial conditions. At December 31, 1995 and 1996, the
incremental borrowing rate under the Former Essex Revolving Credit Agreement and
the Essex Revolving Credit Agreement, including applicable margins, approximated
9.00% and 8.75%, respectively. Indebtedness under the Essex Revolving Credit
Agreement is guaranteed by the Company and all of Essex' subsidiaries, and is
secured by a pledge of the capital stock of Essex and its subsidiaries and by a
first lien on substantially all assets.

The Essex Revolving Credit Agreement also provides a $25,000 letter of
credit subfacility. Essex' ability to borrow under the Essex Revolving Credit
Agreement is restricted by the financial covenants

F-10
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 5 NOTES PAYABLE AND LONG-TERM DEBT (CONTINUED)
contained therein as well as those contained in the Essex Term Loan, as defined
in the second succeeding paragraph, and by certain debt limitation covenants
contained in the indenture under which the 10% Senior Notes due 2003 (the "Essex
Senior Notes") were issued (the "Essex Senior Note Indenture").

The Essex Revolving Credit Agreement contains various covenants which
include, among other things: (a) the maintenance of certain financial ratios and
compliance with certain financial tests and limitations; (b) limitations on
investments and capital expenditures; (c) limitations on cash dividends paid;
and (d) limitations on leases and the sale of assets. Through December 31, 1996,
Essex fully complied with all of the financial ratios and covenants contained in
the Essex Revolving Credit Agreement.

Essex and its subsidiaries also maintain three additional credit facilities
consisting of: (i) a $60.0 million senior unsecured note agreement, dated as of
April 12, 1995 by and among Essex, the Company, as guarantor, the lenders named
therein and The Chase Manhattan Bank, as administrative agent the ("Essex Term
Loan"); (ii) a $25.0 million agreement and lease dated as of April 12, 1995 by
and between Essex and Mellon Financial Services Corporation #3 (the "Essex Sale
and Leaseback Agreement"); and (iii) a $12.0 million (Canadian dollar) credit
agreement by and between an Essex subsidiary and a Canadian chartered bank (the
"Canadian Credit Agreement").

On May 12, 1995 Essex borrowed the full amount available under the Essex
Term Loan and the Essex Sale and Leaseback Agreement. These funds, together with
available cash and borrowings under the Former Essex Revolving Credit Agreement,
were paid to the Company in the form of a cash dividend ($238,748) and repayment
of a portion of an intercompany liability ($34,102) totaling $272,850. The
Company applied such funds to redeem all of its outstanding 16% Senior Discount
Debentures due 2004 (the "Debentures") at 100% of their principal amount of
$272,850 on May 15, 1995. In connection with the Debenture redemption, Essex
terminated its previous credit agreement and recognized an extraordinary charge
of $2,971 ($4,951 before applicable income tax benefit) in the second quarter
1995 for the write-off of unamortized deferred debt expense.

The Essex Term Loan provides an aggregate $60.0 million in term loans, and
is to be repaid in 20 equal quarterly installments, subject to the loan's excess
cash provision, through May 15, 2000. The Essex Term Loan bears floating rates
of interest at bank prime plus 2.75% or LIBOR plus 3.75%. The Essex Term Loan
requires 50% of excess cash, as defined, to be applied against the outstanding
term loan balance. The 1996 excess cash repayment of $12.4 million, based on
1995 results, resulted in remaining principal payments of 17 equal quarterly
installments of $2.3 million. Amounts repaid with respect to the excess cash
provisions may not be reborrowed. There are no requirements for an excess cash
payment to be made for 1996 results.

The Essex Sale and Leaseback Agreement provides $25,000 for the sale and
leaseback of certain of Essex' fixed assets. The Essex Sale and Leaseback
Agreement has a seven-year term expiring in May 2002. The principal component of
the rental is paid quarterly, with the amount of each of the first 27 payments
equal to 2.5% of lessor's cost of the equipment, and the balance is due at the
final payment. The interest component is paid on the unpaid principal balance
and is calculated by lessor at LIBOR plus 2.5%. The effective interest rate can
be reduced by 0.25% to 1.125% if certain specified financial conditions are
achieved. The fixed assets subject to the Essex Sale and Leaseback Agreement
(all of which are machinery and equipment) are included in property, plant and
equipment in the Consolidated

F-11
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 5 NOTES PAYABLE AND LONG-TERM DEBT (CONTINUED)
Balance Sheets and have a gross cost of $30,882 and accumulated amortization of
$4,139 at December 31, 1996.

Borrowings under the Canadian Credit Agreement are restricted to meeting the
working capital requirements of the subsidiary and are collateralized by the
subsidiary's accounts receivable. As of December 31, 1996, $5.9 million was
outstanding under the Canadian Credit Agreement and denoted as notes payable to
banks in the Consolidated Balance Sheets. The Canadian Credit Agreement bears
interest at rates similar to the Essex Revolving Credit Agreement and terminates
one year from its effective date of May 30, 1996, although it may be extended
for successive one year periods upon the mutual consent of the subsidiary and
lending bank.

Essex also has bank lines of credit which provide unsecured borrowings for
working capital of up to $25,000 of which $11,760 and $25,000 were outstanding
at December 31, 1995 and 1996, respectively, and denoted as notes payable to
banks in the Consolidated Balance Sheets. These lines of credit bear interest at
rates subject to agreement between Essex and the lending banks. At December 31,
1995 and 1996 such rates of interest averaged 6.7% and 7.6%, respectively.

ESSEX SENIOR NOTES

At December 31, 1995 and 1996, $200,000 aggregate principal amount of the
Essex Senior Notes were outstanding. The Essex Senior Notes bear interest at 10%
per annum payable semiannually and are due in May 2003. The Essex Senior Notes
rank PARI PASSU in right of payment with all other senior indebtedness of Essex.
To the extent that any other senior indebtedness of Essex is secured by liens on
the assets of Essex, the holders of such senior indebtedness will have a claim
prior to any claim of the holders of the Essex Senior Notes as to those assets.

At the option of Essex, the Essex Senior Notes may be redeemed, commencing
in May 1998 in whole, or in part, at redemption prices ranging from 103.75% in
1998 to 100% in 2001. Upon a Change in Control, as defined in the Essex Senior
Note Indenture, each holder of Essex Senior Notes will have the right to require
Essex to repurchase all or any part of such holder's Essex Senior Notes at a
repurchase price equal to 101% of the principal amount thereof. The Essex Senior
Note Indenture contains various covenants which include, among other things,
limitations on debt, on the sale of assets, and on cash dividends paid. Through
December 31, 1996 Essex fully complied with all of the financial ratios and
covenants contained in the Essex Senior Note Indenture.

THE COMPANY'S SENIOR DISCOUNT DEBENTURES

In May 1989, the Company issued $342,000 aggregate principal amount
($135,117 aggregate proceeds amount) of its Debentures. In connection with the
Acquisition and Merger, the Debentures were valued at an effective annual
interest rate of 14.25% through May 1995. The Debentures accreted to their full
face value (an aggregate principal amount of $272,850) on May 15, 1995. On May
15, 1995 the Company redeemed all of its outstanding Debentures at 100% of their
principal amount with cash received from Essex in the form of a cash dividend
and repayment of a portion of an intercompany liability totalling $272,850.

OTHER

Essex capitalized interest costs of $132, $565 and $558 in 1994, 1995 and
1996, respectively, with respect to qualifying assets.

Total interest paid was $20,826, $32,312 and $38,284 in 1994, 1995 and 1996,
respectively.

F-12
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 5 NOTES PAYABLE AND LONG-TERM DEBT (CONTINUED)
Aggregate annual maturities of long-term debt for the next five years are:

The year 2001 includes repayment of the Essex Revolving Credit Agreement in
the amount of $179,900.

F-13
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 6 INCOME TAXES

Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes. Significant components of
the deferred tax liabilities and assets are as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------
<S> <C> <C>
1995 1996
--------- ---------
Deferred tax liabilities:
Property, plant and equipment.......................... $ 68,553 $ 60,519
Inventory.............................................. 28,485 30,114
Other.................................................. 3,844 4,502
--------- ---------
Total deferred tax liabilities....................... 100,882 95,135
Deferred tax assets:
Accrued liabilities.................................... 6,650 8,252
Alternative minimum tax credit carryforward............ 1,384 --
Other.................................................. 10,694 13,689
--------- ---------
Total deferred tax assets............................ 18,728 21,941
--------- ---------
Net deferred tax liabilities......................... $ 82,154 $ 73,194
--------- ---------
--------- ---------
</TABLE>

The components of income tax expense are:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------------
1994 1995 1996
--------- --------- ---------
<S> <C> <C> <C>
Current:
Federal...................................... $ 14,542 $ 8,560 $ 29,468
State........................................ 3,346 5,334 6,937
Deferred (Credit):
Federal...................................... (7,887) 2,382 (5,805)
State........................................ (501) (1,896) (1,612)
--------- --------- ---------
$ 9,500 $ 14,380 $ 28,988
--------- --------- ---------
--------- --------- ---------
</TABLE>

Total income taxes paid were $11,712, $15,989 and $32,656 in 1994, 1995 and
1996, respectively.

F-14
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 6 INCOME TAXES (CONTINUED)
Principal differences between the effective income tax rate and the
statutory federal income tax rate are as follows:

<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31,
-------------------------------------
1994 1995 1996
----- ----- -----
<S> <C> <C> <C>
Statutory federal income tax rate................... 35.0% 35.0% 35.0%
State and local taxes, net of federal benefit....... 10.9 7.9 5.2
Excess of cost over net assets acquired
amortization...................................... 8.4 5.1 2.1
Other, net.......................................... 1.6 4.0 1.3
--- --- ---
Effective income tax rate........................... 55.9% 52.0% 43.6%
--- --- ---
--- --- ---
</TABLE>

In connection with the Acquisition and Merger in 1992, The Company elected
not to step up its tax bases in the assets acquired. Accordingly, the income tax
bases in the assets acquired have not been changed from pre-1988 Acquisition
values. Depreciation and amortization of the higher allocated financial
statement bases are not deductible for income tax purposes, thus increasing the
effective income tax rate reflected in the consolidated financial statements.

NOTE 7 RETIREMENT BENEFITS

Essex sponsors two defined benefit retirement plans for substantially all
salaried and hourly employees. Essex also has a supplemental executive
retirement plan which provides retirement benefits based on the same formula as
in effect under the salaried employees' plan, but which only takes into account
compensation in excess of amounts that can be recognized under the salaried
employees' plan. Salaried plan retirement benefits are generally based on years
of service and the employee's compensation during the last several years of
employment. Hourly plan retirement benefits are based on hours worked and years
of service with a fixed dollar benefit level. Essex' funding policy is based on
an actuarially determined cost method allowable under Internal Revenue Service
regulations, the projected unit credit method. Pension plan assets consist
principally of fixed income and equity securities and cash and cash equivalents.

The components of net periodic pension cost for the plans are as follows:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------------
1994 1995 1996
--------- --------- ---------
<S> <C> <C> <C>
Service cost--benefits earned during the
period......................................... $ 2,964 $ 2,365 $ 3,377
Interest costs on projected benefit obligation... 3,643 3,923 4,715
Actual return on plan assets..................... 2,409 (13,597) (5,123)
Net amortization and deferral.................... (6,458) 9,751 268
--------- --------- ---------
Net periodic pension cost........................ $ 2,558 $ 2,442 $ 3,237
--------- --------- ---------
--------- --------- ---------
</TABLE>

F-15
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 7 RETIREMENT BENEFITS (CONTINUED)
The following table summarizes the funded status of these pension plans and
the related amounts that are recognized in the Consolidated Balance Sheets:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------
1995 1996
--------- ---------
<S> <C> <C>
Actuarial present value of benefit obligation:
Vested................................................ $ 42,052 $ 44,726
Nonvested............................................. 3,656 3,804
--------- ---------
Accumulated benefit obligation........................ 45,708 48,530
Effect of projected future salary increases........... 17,195 17,690
--------- ---------
Projected benefit obligation.......................... 62,903 66,220
Plan assets at fair value............................... 55,447 60,131
--------- ---------
Projected benefit obligation in excess of fair value of
plan assets........................................... (7,456) (6,089)
Unrecognized net gain................................... (1,312) (5,131)
Unrecognized prior service cost......................... (326) (299)
--------- ---------
Pension liability recognized in balance sheets.......... $ (9,094) $ (11,519)
--------- ---------
--------- ---------
</TABLE>

Certain actuarial assumptions were revised in 1995 and 1996 resulting in an
increase of $13,262 and a decrease of $5,345, respectively, in the projected
benefit obligation.

Following is a summary of significant actuarial assumptions used:

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------------------
1994 1995 1996
----- ----- -----
<S> <C> <C> <C>
Discount rates......................................... 8.5% 7.0% 7.5%
Rates of increase in compensation levels............... 5.0% 5.0% 5.0%
Expected long-term rate of return on assets............ 9.0% 9.0% 9.0%
</TABLE>

In addition to the defined benefit retirement plans as detailed above, Essex
also sponsors defined contribution savings plans which cover substantially all
salaried and non-union hourly employees of Essex and certain other hourly
employees, represented by collective bargaining agreements, who negotiate this
benefit into their contract. The purpose of these savings plans is generally to
provide additional financial security during retirement by providing employees
with an incentive to make regular savings. Essex' contributions to the defined
contribution plans totalled $1,088, $1,123 and $1,194 in 1994, 1995 and 1996,
respectively.

Essex also sponsors an unfunded, nonqualified deferred compensation plan
which permits certain key management employees to annually elect to defer a
portion of their compensation and earn a guaranteed interest rate on the
deferred amounts. The total amount of participant deferrals and accrued
interest, which is reflected in other long-term liabilities, was $609 and $1,234
at December 31, 1995 and 1996, respectively.

F-16
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 8 STOCKHOLDERS' EQUITY

Following is an analysis of stockholders' equity:
<TABLE>
<CAPTION>
OTHER STOCKHOLDERS' EQUITY
----------------------------------------------------------------
COMMON STOCK
REDEEMABLE SUBJECT TO PUT COMMON STOCK ADDITIONAL CARRYOVER OF RETAINED
PREFERRED ---------------------- ----------------------- PAID-IN PREDECESSOR EARNINGS
STOCK SHARES AMOUNT SHARES AMOUNT CAPITAL BASIS (DEFICIT)
------------- --------- ----------- ---------- ----------- ----------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance at
December 31,
1993........... $ 34,460 1,016,189 $ 5,808 16,559,793 $ 165 $ 98,935 $ (15,259) $ (24,174)

Net income....... -- -- -- -- -- -- -- 7,486
Preferred stock
dividend....... 6,008 -- -- -- -- (6,008) -- --
Accretion of
preferred
stock.......... 687 -- -- -- -- (687) -- --
Expiration of put
rights......... -- (58,444) (334) 58,444 1 333 -- --
Stock options
exercised...... -- -- -- 10,250 -- 36 -- --
------------- --------- ----------- ---------- ----- ----------- ------------- -----------
Balance at
December 31,
1994........... 41,155 957,745 5,474 16,628,487 166 92,609 (15,259) (16,688)

Net income....... -- -- -- -- -- -- -- 10,300
Preferred stock
dividend....... 6,962 -- -- -- -- (6,962) -- --
Accretion of
preferred
stock.......... 703 -- -- -- -- (703) -- --
Expiration of put
rights......... -- (117,352) (671) 117,352 1 670 -- --
Stock options
exercised...... -- -- -- 72,868 1 165 -- --
------------- --------- ----------- ---------- ----- ----------- ------------- -----------
Balance at
December 31,
1995........... 48,820 840,393 4,803 16,818,707 168 85,779 (15,259) (6,388)

Net income....... -- -- -- -- -- -- -- 36,325
Issuance of
common stock... -- 437,709 4,377 5,930,000 59 59,241 -- --
Preferred stock
dividend....... 4,248 -- -- -- -- (1,906) -- (2,342)
Accretion of
preferred
stock.......... 2,024 -- -- -- -- (2,024) -- --
Preferred stock
redemption..... (55,092) -- -- -- -- (4,185) -- --
Expiration of put
rights......... -- (15,500) (101) 15,500 -- 101 -- --
Stock options
exercised...... -- -- -- 29,748 1 67 -- --
Increase in fair
value.......... -- -- 3,547 -- -- (3,547) -- --
------------- --------- ----------- ---------- ----- ----------- ------------- -----------
Balance at
December 31,
1996........... $ -- 1,262,602 $ 12,626 22,793,955 $ 228 $ 133,526 $ (15,259) $ 27,595
------------- --------- ----------- ---------- ----- ----------- ------------- -----------
------------- --------- ----------- ---------- ----- ----------- ------------- -----------

TOTAL
---------
<S> <C>
Balance at
December 31,
1993........... $ 59,667
Net income....... 7,486
Preferred stock
dividend....... (6,008)
Accretion of
preferred
stock.......... (687)
Expiration of put
rights......... 334
Stock options
exercised...... 36
---------
Balance at
December 31,
1994........... 60,828
Net income....... 10,300
Preferred stock
dividend....... (6,962)
Accretion of
preferred
stock.......... (703)
Expiration of put
rights......... 671
Stock options
exercised...... 166
---------
Balance at
December 31,
1995........... 64,300
Net income....... 36,325
Issuance of
common stock... 59,300
Preferred stock
dividend....... (4,248)
Accretion of
preferred
stock.......... (2,024)
Preferred stock
redemption..... (4,185)
Expiration of put
rights......... 101
Stock options
exercised...... 68
Increase in fair
value.......... (3,547)
---------
Balance at
December 31,
1996........... $ 146,090
---------
---------
</TABLE>

The authorized capital stock of the Company consists of (i) 150,000,000
shares of common stock divided into two classes consisting of Class A Common
Stock, par value $.01 per share (the "Class A Stock"), and Class B Common Stock,
par value $.01 per share ("Class B Stock"), and (ii) 5,000,000 shares of
preferred stock, par value $.01 per share of which 3,100,000 shares have been
designated Series A Cumulative Redeemable Exchangeable Preferred Stock due 2004
(the "Series A Preferred

F-17
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 8 STOCKHOLDERS' EQUITY (CONTINUED)
Stock") and Series B Cumulative Redeemable Exchangeable Preferred Stock due 2004
(the "Series B Preferred Stock" collectively the "Redeemable Preferred Stock").
The aggregate number of Redeemable Preferred Stock that may be issued and
outstanding at any one time is 3,100,000 shares. As of December 31, 1996 there
were 23,457,057.5 shares of Class A Stock outstanding, 599,500 shares of Class B
Stock outstanding and no shares of Series B Preferred Stock or Series A
Preferred Stock outstanding.

COMMON STOCK AND OPTIONS

The members of Essex management who are stockholders of the Company
("Management Stockholders") are subject to agreements that impose certain
restrictions and grant rights on their ownership and transfer of the Company's
stock. Management Stockholders are generally prohibited from transferring shares
of common stock of the Company owned by them before an initial public offering
by the Company (or any successor thereto). Such shares are subject to the right
of first refusal by the Company or BHLP. Any Management Stockholder who
terminates employment with Essex for reasons other than retirement, disability
or death has a limited right, for one year from the date of termination, to
require the Company to repurchase all the stockholder's shares of common stock
of the Company at the lesser of the purchase price paid by such stockholder or
fair market value, as defined. Any Management Stockholder who retires from
Essex, dies or becomes disabled has a limited right, for one year from the date
of termination, to require the Company to repurchase all the stockholder's
shares of common stock of the Company at fair market value, as defined. The
Company has a right to repurchase such shares at fair market value, as defined,
for one year following employment for any reason. Such rights of both the
Company and the stockholder expire upon an initial public offering. Management
Stockholders also have certain "piggyback" registration rights in the event that
the Company registers shares of its common stock for sale under the Securities
Act of 1933.

Statement of Financial Accounting Standards No. 123, "Accounting for
Stock-Based Compensation" ("FAS 123") encourages, but does not require companies
to record compensation cost for stock-based employee compensation plans at fair
value. The Company has chosen to continue to account for stock-based
compensation using the intrinsic value method prescribed in Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees"
("APB 25"), and related Interpretations. Under APB 25, because the exercise
prices of the Company's stock options are based upon fair value of the stock at
the date of each grant, no compensation expense has been recorded in connection
with the issuance of stock options. A public market does not exist for the
Company's common stock; therefore, the fair value, as approved by the Board of
Directors of the Company, was based upon factors such as sales prices in the
most recent transactions and appropriate earnings multiples.

Grants of options to purchase common stock of the Company have been made to
management and employees of Essex pursuant to, and are subject to the provisions
of, an Amended and Restated Stock Option Plan and individual stock option
agreements. The Amended and Restated Stock Option Plan provides for the issuance
of up to 4,798,144 shares of the Company's common stock. All options granted
have ten year terms and vest and become fully exercisable over periods of one to
three years of continued employment. The number of shares for which all options
are exercisable and the exercise price therefore may be reduced by the Board of
Directors of the Company in accordance with a specified formula.

F-18
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 8 STOCKHOLDERS' EQUITY (CONTINUED)
Pro forma information regarding net income and earnings per share is
required by FAS 123, and has been determined as if the Company had accounted for
its stock options issued in 1995 and 1996 under the fair value method of that
Statement. The fair value for these options was estimated as of the date of
grant using a "minimum value" method acceptable for nonpublic companies. The
effect of applying FAS 123's fair value method to the Company's stock-based
awards results in net income and earnings per share that are not materially
different from amounts reported. Because FAS 123 is applicable only to options
granted subsequent to December 31, 1994, its effect will not be fully reflected
until 1997.

Option valuation models require the input of highly subjective assumptions.
Because the Company's stock options have characteristics significantly different
from those of traded options, and because changes in the subjective input
assumptions can materially affect the fair value estimate, in management's
opinion the existing models do not necessarily provide a reliable single measure
of the fair value of its stock options.

A summary of the Company's stock option activity, and related information
follows:

<TABLE>
<CAPTION>
1994 1995 1996
------------------------ ------------------------ ------------------------
<S> <C> <C> <C> <C> <C> <C>
WEIGHTED- WEIGHTED- WEIGHTED-
AVERAGE AVERAGE AVERAGE
EXERCISE EXERCISE EXERCISE
OPTIONS PRICE OPTIONS PRICE OPTIONS PRICE
--------- ------------- --------- ------------- --------- -------------
Outstanding-beginning of
year....................... 1,998,300 $ 2.06 2,153,800 $ 2.34 2,464,175 $ 2.94
Granted...................... 165,750 5.72 432,500 5.72 462,500 6.52
Exercised.................... (10,250) 2.10 (113,375) 2.04 (46,200) 2.04
Forfeited.................... -- -- (8,750) 5.72 (9,500) 5.72
--------- ----- --------- ----- --------- -----
Outstanding-end of year...... 2,153,800 $ 2.34 2,464,175 $ 2.94 2,870,975 $ 3.52
--------- ----- --------- ----- --------- -----
--------- ----- --------- ----- --------- -----
Exercisable at end of year... 1,988,050 $ 2.06 1,874,675 $ 2.06 1,828,475 $ 2.06
</TABLE>

As of December 31, 1996 there were 1,618,000 options at $2.00 per share
exercise price, 210,475 options at $2.50 exercise price, 955,000 options at
$5.72 per share exercise price and 87,500 options at $10.00 per share exercise
price outstanding to purchase shares of the Company's common stock. The
weighted-average remaining contractual life of those options is 6.7 years. In
January 1997 the Company issued options to purchase 730,000 shares of the
Company's common stock at a $10.00 exercise price. Such options were granted in
connection with the 1996 private offering to certain management employees and
with regard to the Company's 1996 performance.

PREFERRED STOCK AND WARRANTS

On July 3, 1996, the Company called for redemption all of its outstanding
Redeemable Preferred Stock. The Redeemable Preferred Stock was redeemed at the
close of business on July 15, 1996, at a redemption price of $26.875 per share,
plus accrued and unpaid dividends through the redemption date of $0.166 per
share, for a total redemption price of $27.041 per share or $59,277 in the
aggregate including redemption expenses.

The redemption of the outstanding Redeemable Preferred Stock was financed by
the Company through a private offering of 5,930,000 shares of its common stock
to certain of its current common

F-19
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 8 STOCKHOLDERS' EQUITY (CONTINUED)
stockholders and their affiliates. In December 1996, the private offering was
extended to certain management employees of Essex who, collectively, purchased
437,708.5 shares of common stock. These offerings were not registered under the
Securities Act of 1933, and such common stock may not be offered or sold in the
United States absent such registration or an applicable exemption from
registration.

In connection with the Acquisition and Merger in 1992 and related issuance
of the Series A Preferred Stock, 2,833,369 warrants to purchase the Company's
common stock (the "Warrants") were issued. The Series A Preferred Stock and
Warrants were recorded at their estimated fair values of which $4,250 was
assigned to the Warrants. The excess of the liquidation preference value over
the carrying value of the Series A Preferred Stock of $4,250, was being accreted
by periodic charges to paid in capital. Such liquidation preference became fully
accreted upon the redemption of the redeemable preferred stock.

The Warrants, of which there were 2,833,369 outstanding at December 31,
1996, are presently exercisable and represent the right to purchase an aggregate
of approximately 10% of the fully diluted common stock of the Company (based on
the common equity, warrants and options outstanding as of December 31, 1996).
The Warrants are exercisable at $5.72 per share and expire on October 9, 2004.

NOTE 9 RELATED PARTY TRANSACTIONS

Advisory services fees of $1,000 were paid to an affiliate of BHLP for 1994,
1995 and 1996, respectively. It is expected that financial advisory fees to an
affiliate of BHLP will continue to be paid for such services in the future.

NOTE 10 DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE INFORMATION

Essex, to a limited extent, uses forward fixed price contracts and
derivative financial instruments to manage foreign currency exchange and
commodity price risks. Essex does not hold or issue financial instruments for
investment or trading purposes. Essex is exposed to credit risk in the event of
nonperformance by counterparties for foreign exchange forward contracts, metal
forward price contracts and metals futures contracts, but Essex does not
anticipate nonperformance by any of these counterparties. The amount of such
exposure is generally the unrealized gains within the underlying contracts.

FOREIGN EXCHANGE RISK MANAGEMENT

Essex engages in the sale and purchase of goods and services which
periodically require payment or receipt of amounts denominated in foreign
currencies. To protect Essex' related anticipated cash flows from the risk of
adverse foreign currency exchange fluctuations for firm sales and purchase
commitments, Essex enters into foreign currency forward exchange contracts. At
December 31, 1995 Essex had Deutschemark forward exchange sales contracts of
$1,145 and purchase contracts of $886. At December 31, 1996, Essex had no
Deutschemark forward exchange sales contracts but did have $138 of purchase
contracts. The fair value of such contracts approximated the contract amount.
Foreign currency gains or losses resulting from Essex' operating and hedging
activities are recognized in earnings in the period in which the hedged currency
is collected or paid. The related amounts due to or from counterparties are
included in other liabilities or other assets.

F-20
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 10 DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE INFORMATION (CONTINUED)
COMMODITY PRICE RISK MANAGEMENT

Copper, Essex' principal raw material, experiences marked fluctuations in
market prices, thereby subjecting Essex to copper price risk with respect to
copper purchases and to firm and anticipated customer sales contracts.
Derivative financial instruments in the form of copper futures contracts are
utilized by Essex to reduce those risks.

Purchase or "long" contracts are utilized by Essex to hedge firm and
anticipated sales contracts while sales or "short" contracts are employed with
respect to "carryover" copper purchases. Copper carryover purchases represent
that portion of Essex' current month's copper purchase commitments priced at the
current month's average New York Commodity Exchange, Inc. ("COMEX") price, but
not delivered until the following month. Short contracts are utilized to
mitigate risk that copper prices, at the time of copper receipt, are likely to
be below the average COMEX price of the incoming copper carryover.

Purchase contracts at December 31, 1995 and 1996 totalled 14.7 and 42.5
million copper pounds, respectively, with contract amounts of $17,100 and
$42,000 and estimated fair values of $16,900 and $41,300, respectively. There
are no sales contracts at December 31, 1996. Sales contracts at December 31,
1995 totalled 13.5 million copper pounds, with a contract amount of $16,600 and
a fair value of $16,300. Deferred and unrealized gains or losses on these
futures contracts ($100 gain and $700 loss at December 31, 1995 and 1996,
respectively) are included within other assets and will be recognized in
earnings in the period in which the hedged copper is sold to customers and the
underlying contracts are liquidated, when a sale is no longer expected to occur
or when the carryover copper is received.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company's financial instruments, exclusive of certain forward contracts
and futures contracts as discussed above, generally consist of cash and cash
equivalents and long-term debt. The carrying amounts of the Company's cash and
cash equivalents approximated fair value at December 31, 1995 and 1996 while the
carrying amount of the Essex Senior Notes exceeded fair value by approximately
$4,000 at December 31, 1995 and was less than fair value by approximately $8,000
at December 31, 1996. Fair values with respect to the Company's foreign currency
forward exchange contracts and copper futures contracts are determined based on
quoted market prices.

NOTE 11 CONTINGENT LIABILITIES AND COMMITMENTS

There are various claims and pending legal proceedings against Essex
including environmental matters and other matters arising out of the ordinary
course of its business. Pursuant to the 1988 Acquisition, UTC agreed to
indemnify Essex against all losses (as defined) resulting from or in connection
with damage or pollution to the environment and arising from events, operations,
or activities of Essex prior to February 29, 1988 or from conditions or
circumstances existing at February 29, 1988. Except for certain matters relating
to permit compliance, Essex is fully indemnified with respect to conditions,
events or circumstances known to UTC prior to February 29, 1988. The sites
covered by this indemnity are handled directly by UTC and all payments required
to be made are paid directly by UTC. The amounts related to this environmental
contingency are not material to Holding's consolidated financial statements. UTC
also provided a second environmental indemnity which deals with losses

F-21
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 11 CONTINGENT LIABILITIES AND COMMITMENTS (CONTINUED)
related to environmental events, conditions or circumstances existing at or
prior to February 29, 1988, which only became known in the five year period
commencing February 29, 1988. As to any such losses, Essex is responsible for
the first $4,000 incurred. Management and its legal counsel periodically review
the probable outcome of pending proceedings and the costs reasonably expected to
be incurred. Essex accrues for these costs when it is probable that a liability
has been incurred and the amount of the loss can be reasonably estimated. After
consultation with counsel, in the opinion of management, the ultimate cost to
Essex, exceeding amounts provided, will not materially affect its consolidated
financial position, cash flows or results of operations. There can be no
assurance, however, that future developments will not alter this conclusion.

Since approximately 1990, Essex has been named as a defendant in a limited
number of product liability lawsuits brought by electricians and other skilled
tradesmen claiming injury from exposure to asbestos found in electrical wire
products produced a number of years ago. During 1996, the number of cases filed
against Essex increased to 95 involving approximately 400 claims. Essex'
strategy is to defend these cases vigorously. Essex believes that its liability,
if any, in these matters and the related defense costs will not have a material
adverse effect either individually or in the aggregate upon its business,
financial condition, cash flows or results of operations. There can be no
assurance, however, that future developments will not alter this conclusion.

At December 31, 1996, Essex had purchase commitments of 747.6 million pounds
of copper. This is not expected to be either a quantity in excess of needs or at
prices in excess of amounts that can be recovered upon sale of the related
copper products. The commitments are to be priced based on the COMEX price in
the contractual month of shipment except for 26.6 million pounds of copper that
have been priced at fixed amounts through forward purchase contracts covered by
customer sales agreements at copper prices at least equal to Essex' copper
commitment.

At December 31, 1996, Essex had committed $5,547 to outside vendors for
certain capital projects.

Essex occupies space and uses certain equipment under lease arrangements.
Rent expense was $6,912, $7,478 and $8,941 under such arrangements for 1994,
1995 and 1996, respectively. Rental commitments at December 31, 1996 under
long-term noncancellable operating leases were as follows:

<TABLE>
<CAPTION>
REAL ESTATE EQUIPMENT TOTAL
----------- ------------- ---------
<S> <C> <C> <C>
1997.................................................... $ 3,096 $ 2,730 $ 5,826
1998.................................................... 2,962 2,514 5,476
1999.................................................... 3,003 1,866 4,869
2000.................................................... 2,704 996 3,700
2001.................................................... 2,562 681 3,243
After 2001.............................................. 10,696 683 11,379
----------- ------------- ---------
$ 25,023 $ 9,470 $ 34,493
----------- ------------- ---------
----------- ------------- ---------
</TABLE>

F-22
<PAGE>
BCP/ESSEX HOLDINGS INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTE 12 QUARTERLY FINANCIAL DATA (UNAUDITED)
<TABLE>
<CAPTION>
1995 1ST QTR 2ND QTR 3RD QTR 4TH QTR
- ------------------------------------------------- --------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net sales........................................ $ 289,649 $ 288,534 $ 308,288 $ 315,179
Gross margin..................................... 42,426 37,598 44,765 46,350
Income before extraordinary charge............... 3,071 1,015 6,086 3,099
Net income (loss)(a)............................. 3,071 (1,956) 6,086 3,099
Income (loss) per share:
Income (loss) before extraordinary charge...... $ $ $ $
Extraordinary charge........................... -- -- --
--------- --------- --------- ---------
Net income (loss).............................. $ $ $ $
--------- --------- --------- ---------
--------- --------- --------- ---------

1996 1ST QTR 2ND QTR 3RD QTR 4TH QTR
- ------------------------------------------------- --------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net sales........................................ $ 308,410 $ 337,533 $ 328,777 $ 357,329
Gross margin..................................... 49,759 52,891 58,964 67,975
Income before extraordinary charge............... 6,390 7,596 11,582 11,940
Net income (b)................................... 6,390 7,596 11,582 10,757
Income per share:
Income before extraordinary charge............. $ $ $ $
Extraordinary charge........................... -- -- --
--------- --------- --------- ---------
Net income..................................... $ $ $ $
--------- --------- --------- ---------
--------- --------- --------- ---------
</TABLE>

- ------------------------

(a) In the second quarter 1995, Essex recognized an extraordinary charge of
$2,971 ($ per share), net of applicable income tax benefit of $1,980,
representing the write-off of unamortized deferred debt expense in
connection with the termination of its former credit agreement.

(b) In the fourth quarter 1996, Essex recognized an extraordinary charge of
$1,183 ($ per share), net of applicable income tax benefit of $788,
representing the write-off of unamortized deferred debt expense in
connection with the termination of its former credit agreement.

NOTE 13 SUBSEQUENT EVENT

On February 19, 1997 the Company filed a Registration Statement with the
Securities and Exchange Commission for an initial public offering ("IPO") of its
common stock. The proceeds to the Company from the IPO will be used to repay, in
full, the remaining amounts outstanding under the Essex Term Loan and repay a
portion of borrowings outstanding under the Essex Revolving Credit Agreement. On
, 1997, the Company effected a one for two reverse stock split. All
common shares and per share amounts have been adjusted retroactively to give
effect to the reverse stock split.

F-23
<PAGE>
UNDERWRITING

Subject to the terms and conditions of the Underwriting Agreement, the
Company and the Selling Stockholders have agreed to sell to each of the U.S.
Underwriters named below (the "U.S. Underwriters"), and each of such U.S.
Underwriters, for whom Goldman, Sachs & Co., Smith Barney Inc., Donaldson,
Lufkin & Jenrette Securities Corporation and Lehman Brothers Inc. are acting as
representatives, has severally agreed to purchase from the Company and the
Selling Stockholders, the respective number of shares of Common Stock set forth
opposite its name below:

<TABLE>
<CAPTION>
NUMBER OF
SHARES OF
UNDERWRITER COMMON STOCK
- -------------------------------------------------------------------------- ------------------
<S> <C>
Goldman, Sachs & Co.......................................................
Smith Barney Inc..........................................................
Donaldson, Lufkin & Jenrette Securities Corporation.......................
Lehman Brothers Inc.......................................................

-------
Total.................................................................
-------
-------
</TABLE>

Under the terms and conditions of the Underwriting Agreement, the U.S.
Underwriters are committed to take and pay for all of the shares offered hereby,
if any are taken.

The U.S. Underwriters propose to offer the shares of Common Stock in part
directly to the public at the initial public offering price set forth on the
cover page of this Prospectus and in part to certain securities dealers at such
price less a concession of $[ ] per share. The U.S. Underwriters may allow, and
such dealers may re-allow, a concession not in excess of $[ ] per share to
certain brokers and dealers. After the shares of Common Stock are released for
sale to the public, the offering price and other selling terms may from time to
time be varied by the representatives.

The Company and the Selling Stockholders have entered into an underwriting
agreement (the "International Underwriting Agreement") with the Underwriters of
the international offering (the "International Underwriters") providing for the
concurrent offer and sale of [ ] shares of Common Stock in an international
offering outside the United States. The offering price and aggregate
underwriting discounts and commissions per share for the two offerings are
identical. The closing of the offering made hereby is a condition to the closing
of the international offering, and vice versa. The representatives of the
International Underwriters are Goldman Sachs International, Smith Barney Inc.,
Donaldson, Lufkin & Jenrette Securities Corporation and Lehman Brothers
International (Europe).

Pursuant to an Agreement between the U.S. and International Underwriting
Syndicates (the "Agreement Between") relating to the Offerings, each of the U.S.
Underwriters named herein has agreed that, as a part of the distribution of the
shares offered hereby and subject to certain exceptions, it will offer, sell or
deliver the shares of Common Stock, directly or indirectly, only in the United
States of America (including the States and the District of Columbia), its
territories, its possessions and other areas subject to its jurisdiction (the
"United States") and to U.S. persons, which term shall mean, for purposes of
this paragraph: (a) any individual who is a resident of the United States or (b)
any corporation, partnership or other entity organized in or under the laws of
the United States or any political subdivision thereof and whose office most
directly involved with the purchase is located in the United States. Each of the
International Underwriters has agreed or will agree pursuant to the Agreement
Between that, as a part of

U-1
<PAGE>
the distribution of the shares offered as a part of the international offering,
and subject to certain exceptions, it will (i) not, directly or indirectly,
offer, sell or deliver shares of Common Stock (a) in the United States or to any
U.S. persons or (b) to any person whom it believes intends to reoffer, resell or
deliver the shares in the United States or to any U.S. persons and (ii) cause
any dealer to whom it may sell such shares at any concession to agree to observe
a similar restriction.

Pursuant to the Agreement Between, sales may be made between the U.S.
Underwriters and the International Underwriters of such number of shares of
Common Stock as may be mutually agreed. The price of any shares so sold shall be
the initial public offering price, less an amount not greater than the selling
concession.

The Selling Stockholders have granted the U.S. Underwriters an option
exercisable for 30 days after the date of this Prospectus to purchase up to an
aggregate of [ ]additional shares of Common Stock solely to cover
over-allotments, if any. If the U.S. Underwriters exercise their over-allotment
option, the U.S. Underwriters have severally agreed, subject to certain
conditions, to purchase approximately the same percentage thereof that the
number of shares to be purchased by each of them, as shown in the foregoing
table, bears to the [ ] shares of Common Stock offered. The Selling Stockholders
have granted the International Underwriters a similar option to purchase up to
an aggregate of [ ] additional shares of Common Stock.

Certain holders of shares of Common Stock, including the Selling
Stockholders, have agreed that, during the period beginning from the date of
this Prospectus and continuing to and including the date 180 days after the date
of the Prospectus, they will not offer, sell, contract to sell, grant any option
to sell, transfer or otherwise dispose of, directly or indirectly, shares of
Common Stock, securities substantially similar to the Common Stock, or
securities exchangeable for or convertible into shares of Common Stock or any
substantially similar security without the prior written consent of Goldman,
Sachs & Co. The Company has agreed, with certain limited exceptions, that,
during the period beginning from the date of this Prospectus and continuing to
and including the date 180 days after the date of the Prospectus, it will not
offer, sell, contract to sell, grant any option to sell, transfer or otherwise
dispose of, directly or indirectly, or file a registration statement relating
to, shares of Common Stock, securities substantially similar to the Common
Stock, or securities exchangeable for or convertible into shares of Common Stock
or any substantially similar security (other than pursuant to employee stock
option plans existing, or upon the conversion or exchange of convertible or
exchangeable securities outstanding, on the date of this Prospectus) without the
prior written consent of Goldman, Sachs & Co.

At the Company's request, the Underwriters have reserved up to [ ] shares
of Common Stock (the "Directed Shares") for sale at the initial public offering
price to employees of the Company who have advised the Company of their desire
to participate in its future growth. Each purchaser of more than [ ] Directed
Shares will be required to agree to restrictions on resale similar to those
described in the preceding paragraph. The number of shares of Common Stock
available for sale to the general public will be reduced to the extent of sales
of Directed Shares. Any Directed Shares not so purchased will be offered by the
Underwriters on the same basis as all other shares offered hereby.

Prior to this offering, there has been no public market for the Common
Stock. The initial public offering price will be negotiated among the Company,
the Selling Stockholders and the representatives of the U.S. Underwriters and
the International Underwriters. Among the factors to be considered in
determining the initial public offering price of the Common Stock, in addition
to prevailing market conditions, will be the Company's historical performance,
estimates of the business potential and earnings prospects of the Company, an
assessment of the Company's management and the consideration of the above
factors in relation to market valuation of companies in related businesses.

The Company intends to make an application to list the Common Stock on the
New York Stock Exchange under the symbol "[ ]." In order to meet one of the
requirements for listing the Common Stock

U-2
<PAGE>
on the New York Stock Exchange, the U.S. Underwriters have undertaken to sell
lots of 100 or more shares to a minimum of 2,000 beneficial holders.

The Company and the Selling Stockholders have agreed to indemnify the
several Underwriters against certain liabilities, including liabilities under
the Securities Act.

Affiliates of Goldman, Sachs & Co. (the GS Partnerships) own over 10% of the
outstanding shares of Common Stock (on a fully diluted basis). See "Principal
and Selling Stockholders". As a result, this offering will be made in compliance
with the applicable provisions of Conduct Rule 2720 of the National Association
of Securities Dealers, Inc. Accordingly, the initial public offering price can
be no higher than that recommended by a "qualified independent underwriter"
meeting certain standards. In accordance with this requirement, Smith Barney
Inc. is serving in such role and will recommend a price in compliance with the
requirements of Rule 2720. Smith Barney Inc., in its role as qualified
independent underwriter, has performed due diligence investigations and reviewed
and participated in the preparation of this Prospectus and the Registration
Statement of which this Prospectus forms a part. In addition, the Underwriters
may not confirm sales to any discretionary account without the prior specific
written approval of the customer.

Pursuant to the Investors Shareholders Agreement, the GS Partnerships have
the ability to designate one member of the Board of Directors of the Company.
Joseph H. Gleberman, a Managing Director of Goldman, Sachs & Co., currently
serves as such designated director. He will resign from the Board of Directors
effective prior to the consummation of the Offerings. See "Management--Directors
and Executive Officers" and "Certain Relationships and Related Party
Transactions--Investors Shareholders Agreement".

Affiliates of Donaldson, Lufkin & Jenrette Securities Corporation own over
5% of the outstanding shares of Common Stock (on a fully diluted basis). See
"Principal and Selling Stockholders".

This Prospectus may be used by underwriters and dealers in connection with
offers and sales of the Common Stock, including shares initially sold in the
International Offering, to persons located in the United States.

U-3
<PAGE>
- ----------------------------------------------
----------------------------------------------
- ----------------------------------------------
----------------------------------------------

NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES TO
WHICH IT RELATES OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY SUCH
SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION IS UNLAWFUL.
NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER
ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE INFORMATION CONTAINED
HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.

------------------------

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Prospectus Summary....................... 3
Risk Factors............................. 10
Use of Proceeds.......................... 15
Dividend Policy.......................... 15
Dilution................................. 16
Capitalization........................... 18
Selected Consolidated Financial and
Operating Data......................... 19
Management's Discussion and Analysis of
Financial Condition and Results of
Operations............................. 21
Business................................. 28
Management............................... 42
Principal and Selling Stockholders....... 50
Certain Relationships and Related Party
Transactions........................... 52
Description of Capital Stock............. 56
Description of Certain Indebtedness...... 59
Shares Eligible for Future Sale.......... 62
Certain United States Federal Tax
Consequences To Non-United States
Holders of Common Stock................ 65
Validity of Common Stock................. 67
Experts.................................. 67
Additional Information................... 68
Index to Financial Statements............ F-1
Underwriting............................. U-1
</TABLE>

------------------------

THROUGH AND INCLUDING , 1997 (THE 25TH DAY AFTER THE DATE OF
THIS PROSPECTUS), ALL DEALERS EFFECTING TRANSACTIONS IN THE COMMON STOCK,
WHETHER OR NOT PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A
PROSPECTUS. THIS IS IN ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER A
PROSPECTUS WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD
ALLOTMENTS OR SUBSCRIPTIONS.

ESSEX

INTERNATIONAL

INC.

COMMON STOCK

(PAR VALUE $.01 PER SHARE)

---------------------

[LOGO]

---------------------

GOLDMAN, SACHS & CO.

SMITH BARNEY INC.

DONALDSON, LUFKIN & JENRETTE

SECURITIES CORPORATION

LEHMAN BROTHERS

REPRESENTATIVES OF THE UNDERWRITERS

- ----------------------------------------------
----------------------------------------------
- ----------------------------------------------
----------------------------------------------
<PAGE>
PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

Set forth below is a table of the registration fee for the Securities and
Exchange Commission, the filing fee for the National Association of Securities
Dealers, Inc., the listing fee for the New York Stock Exchange and estimates of
all other expenses to be incurred in connection with the issuance and
distribution of the securities described in this Registration Statement, other
than underwriting discounts and commissions:

<TABLE>
<S> <C>
SEC registration fee............................................. $ 45,455
NASD filing fee.................................................. 15,550
NYSE listing fee................................................. *
Printing and engraving expenses.................................. *
Legal fees and expenses.......................................... *
Accounting fees and expenses..................................... *
Transfer agent and registrar fees................................ *
Miscellaneous.................................................... *
---------
Total............................................................ $
---------
---------
</TABLE>

- ------------------------

* To be completed by amendment.

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS

The Registrant is empowered by Section 145 of the General Corporation Law of
the State of Delaware (the "Delaware Corporation Law"), subject to the
procedures and limitations therein, to indemnify any person against expenses
(including attorney's fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by such person in connection with any
threatened, pending or completed action, suit or proceeding in which such person
is made a party by reason of such person being or having been a director,
officer, employee or agent of the Registrant. The statute provides that
indemnification pursuant to its provisions is not exclusive of other rights of
indemnification to which a person may be entitled under any By-law, agreement,
vote of stockholders or disinterested directors, or otherwise. The By-laws of
the Registrant provide for indemnification by the Registrant of its directors
and officers to the fullest extent permitted by the Delaware Corporation Law.

The foregoing statements are subject to the detailed provisions of the
Delaware Corporation Law, the Registrant's Amended and Restated Certificate of
Incorporation and the Registrant's By-laws.

Article XI of the Registrant's By-laws allows the Registrant to maintain
director and officer liability insurance on behalf of any person who is or was a
director or officer of the Registrant or such person who serves or served as a
director, officer, agent or employee, at another corporation, partnership or
other enterprise at the request of the Registrant.

Pursuant to Section 102(b)(7) of the Delaware Corporation Law, Article VI of
the Amended and Restated Certificate of Incorporation of the Registrant provides
that no director shall be personally liable to the Registrant or any of its
stockholders for monetary damages for breach of fiduciary duty as a director,
except for liability (i) for any breach of the director's duty of loyalty to the
Registrant or its stockholders, (ii) for acts or omissions not in good faith or
that involve intentional misconduct or a knowing violation of law, (iii)
pursuant to Section 174 of the Delaware General Corporation Law or (iv) for any
transaction from which the director derived an improper personal benefit.

II-1
<PAGE>
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

On July 3, 1996, the Registrant issued an aggregate of 5,930,000 shares of
Common Stock to certain of its current stockholders and their affiliates
(including 1,362,298 shares of Common Stock to Bessemer Holdings, L.P., 400,000
shares of Common Stock to an affiliate of Goldman, Sachs & Co. and 230,000
shares of Common Stock to Chase Equity Associates, a California Limited
Partnership) at the price of $10.00 per share (after adjusting for a reverse
stock split). On December 27, 1996, in connection with this offering, the
Registrant issued an additional 437,708.5 shares of Common Stock to certain
management employees of the Registrant at the price of $10.00 per share (after
adjusting for a reverse stock split). The integrated offering, with an aggregate
offering price of $63,677,080, was made pursuant to Rule 506 of Regulation D of
the Securities Act, being an offering made by an issuer to no more than 35
purchasers (as defined) without any general solicitation and otherwise pursuant
to the requirements of Rule 506.

In January 1996, the Registrant granted to employees, in connection with
1995 performance, options to purchase up to 375,000 shares of Common Stock at an
exercise price of $5.72 per share. In October 1996, the Registrant granted to
employees options to purchase up to 87,500 shares of Common Stock at an exercise
price of $10.00 per share. In January 1997, the Registrant granted to employees,
in connection with 1996 performance and the 1996 private stock offering
described in the preceding paragraph, options to purchase up to 730,000 shares
of Common Stock at an exercise price of $10.00 per share.

II-2
<PAGE>
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) Exhibits:

<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- --------- ---------------------------------------------------------------------------------------------------------
<C> <S>

*1.1 --Form of U.S. Underwriting Agreement

*1.2 --Form of International Underwriting Agreement

2.1 --Agreement and Plan of Merger, dated as of July 24, 1992, between B E Acquisition Corporation and the
Registrant (then known as MS/Essex Holdings, Inc.), incorporated by reference to Exhibit 2.1 to the
Registrant's Current Report on Form 8-K, filed with the Securities and Exchange Commission (the
"Commission") on August 10, 1992 (Commission File No. 1-10211)

2.2 --Amendment dated as of October 1, 1992, to the Agreement and Plan of Merger between B E Acquisition
Corporation and the Registrant, incorporated by reference to Exhibit 2.2 to the Registrant's Current
Report on Form 8-K, filed with the Commission on October 26, 1992 (Commission File No. 1-10211)

*3.1 --Form of Second Amended and Restated Certificate of Incorporation of the Registrant

*3.2 --Form of By-laws of the Registrant

4.1 --Stock and Warrant Subscription Agreement dated as of October 9, 1992, among B E Acquisition
Corporation, certain affiliates of Donaldson, Lufkin & Jenrette, Inc., certain affiliates of Goldman,
Sachs & Co. and Chemical Equity Associates, A California Limited Partnership, incorporated by reference
to Exhibit 4.3 to the Registrant's Current Report on Form 8-K, filed with the Commission on October 26,
1992 (Commission File No. 1-10211)

4.2 --Warrant Agreement dated as of October 9, 1992, among B E Acquisition Corporation, certain affiliates of
Donaldson, Lufkin & Jenrette, Inc. and certain affiliates of Goldman, Sachs & Co., incorporated by
reference to Exhibit 4.5 to the Registrant's Current Report on Form 8-K, filed with the Commission on
October 26, 1992 (Commission File No. 1-10211)

4.3 --Amendment No. 2 dated as of June 5, 1995 to the Stock and Warrant Subscription Agreement dated as of
October 9, 1992 among the Registrant, certain affiliates of Donaldson, Lufkin & Jenrette, Inc., certain
affiliates of Goldman, Sachs & Co., and Chemical Equity Associates, A California Limited Partnership
incorporated by reference to Exhibit 4.04 of the Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1996, filed with the Commission on February 19, 1997 (Commission File No.
1-10211)

4.4 --Indenture dated as of May 7, 1993, among Essex Group, Inc. and NBD Bank, National Association, as
trustee under which the 10% Senior Notes Due 2003 are outstanding, incorporated by reference to Exhibit
4.1 to the Essex Registration Statement on Pre-Effective Amendment No. 1 to Form S-2 (Commission File
No. 33-59488)

II-3
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- --------- ---------------------------------------------------------------------------------------------------------
<C> <S>
4.6 --Senior Unsecured Note Agreement dated as of April 12, 1995, among the Registrant, as guarantor, Essex
Group, Inc., the lenders named therein and The Chase Manhattan Bank, as administrative agent,
incorporated by reference to Exhibit 10.2 to the Registrant's Quarterly Report on Form 10-Q, filed with
the Commission on May 12, 1995 (Commission File No. 1-10211)

4.7 --Agreement and Lease dated as of April 12, 1995, between Mellon Financial Services Corporation #3 and
Essex Group, Inc., incorporated by reference to Exhibit 10.3 to the Registrant's Quarterly Report on
Form 10-Q, filed with the Commission on May 12, 1995 (Commission File No. 1-10211)

*5 --Opinion of Cravath, Swaine & Moore

9.1 --Investors Shareholders Agreement dated as of October 9, 1992, among B E Acquisition Corporation,
Bessemer Capital Partners, L.P., certain affiliates of Donaldson, Lufkin & Jenrette, Inc., certain
affiliates of Goldman, Sachs & Co., and Chemical Equity Associates, A California Limited Partnership,
incorporated by reference to Exhibit 28.1 to the Registrant's Current Report on Form 8-K, filed with
the Commission on October 26, 1992 (Commission File No. 1-10211)

9.2 --Management Stockholders and Registration Rights Agreement dated as of October 9, 1992, among B E
Acquisition Corporation, Bessemer Capital Partners, L.P. and certain employees of the Registrant's
subsidiaries, incorporated by reference to Exhibit 28.3 to the registrant's Current Report on Form 8-K,
filed with the Commission on October 26, 1992 (Commission File No. 1-10211)

9.3 --Form of Irrevocable Proxy dated as of October 9, 1992, granted to Bessemer Capital Partners, L.P. by
certain employees of the Registrant's subsidiaries, incorporated by reference to Exhibit 28.4 to the
Registrant's Current Report on Form 8-K, filed with the Commission on October 26, 1992 (Commission File
No. 1-10211)

9.4 --Form of Irrevocable Proxy dated December 1996, granted to Bessemer Holdings, L.P. by certain employees
of the Registrant's subsidiaries, incorporated by reference to Exhibit 9.06 to the Registrant's Annual
Report on Form 10-K for the fiscal year ended December 31, 1996, filed with the Commission on February
19, 1997 (Commission File No. 1-10211)

9.5 --Amendment No. 1 dated as of July 3, 1996, to the Management Stockholders Agreement, incorporated by
reference to Exhibit 9.04 to the Registrant's Annual Report on Form 10-K for the fiscal year ended
December 31, 1996, filed with the Commission on February 19, 1997 (Commission File No. 1-10211)

9.6 --Amendment No. 2 dated as of December 11, 1996, to the Management Stockholders Agreement, incorporated
by reference to Exhibit 9.05 to the Registrant's Annual Report on Form 10-K for the fiscal year ended
December 31, 1996, filed with the Commission on February 19, 1997 (Commission File No. 1-10211)

10.1 --Engagement Letter dated July 22, 1992 between Bessemer Capital Partners, L.P. and Donaldson, Lufkin &
Jenrette Securities Corporation, incorporated by reference to Exhibit 10.10 to the Essex Annual Report
on Form 10-K for the fiscal year ended December 31, 1992 (Commission File No. 1-7418)

10.2 --Amendment dated October 9, 1992 among Bessemer Capital Partners, L.P., B E Acquisition Corporation,
Donaldson, Lufkin & Jenrette Securities Corporation and
</TABLE>

II-4
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- --------- ---------------------------------------------------------------------------------------------------------
Goldman, Sachs & Co., to Engagement Letter dated July 22, 1992 among Bessemer Capital Partners, L.P.
and Donaldson, Lufkin & Jenrette Securities Corporation, incorporated by reference to Exhibit 10.11 to
the Essex Annual Report on Form 10-K for the fiscal year ended December 31, 1992 (Commission file No.
1-74181)
<C> <S>

10.3 --Advisory Services Agreement dated as of December 15, 1992, among Bessemer Capital Partners, L.P., the
Registrant and Essex Group, Inc. incorporated by reference to Exhibit 10.15 to the registrant's Annual
Report on Form 10-K for the fiscal year ended December 31, 1992 (Commission File No. 1-10211)

*10.7 --Registration Rights Agreement between Bessemer Holdings, L.P. and the Registrant

*11.1 --Earnings per share

21.1 --Subsidiaries of the Registrant

23.1 --Consent of Ernst & Young LLP

*23.2 --Consent of Cravath, Swaine & Moore

24. --Powers of Attorney (included in signature page)

99.1 --Registration Rights Agreement ("Registration Rights Agreement") dated as of October 9, 1992, among B E
Acquisition Corporation, certain affiliates of Donaldson, Lufkin & Jenrette, Inc., certain affiliates
of Goldman, Sachs & Co., and Chemical Equity Associates, A California Limited Partnership, incorporated
by reference to Exhibit 28.2 to the Registrant's Current Report on Form 8-K, filed with the Commission
on October 26, 1992 (Commission File No. 1-10211)

99.2 --Amendment No. 1 dated as of June 5, 1995, to the Registration Rights Agreement incorporated by
reference to Exhibit 99.02 of the Registrant's Annual Report on Form 10-K for the fiscal year ended
December 31, 1996, filed with the Commission on February 19, 1997 (Commission File No. 1-10211)

99.3 --Amended and Restated Stock Option Plan ("Stock Option Plan") of the Registrant, incorporated by
reference to Exhibit 4.7 to the Registrant's Current Report on Form 8-K, filed with the Commission on
October 26, 1992 (Commission File No. 1-10211)

99.4 --Amendment No. 1 to the Stock Option Plan, incorporated by reference to Exhibit 99.04 to the
Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1996, filed with the
Commission on February 19, 1997 (Commission File No. 1-10211)
</TABLE>

- ------------------------

* To be filed by amendment

(b) Schedule(s):

Schedule I--Parent Company Only Condensed Financial Statements

Schedule II--Valuation and Qualifying Accounts

ITEM 17. UNDERTAKINGS

The undersigned Registrant hereby undertakes to provide to the Underwriters
at the closing of the Offerings, certificates in such denominations and
registered in such names as required by the Underwriters to permit prompt
delivery to each purchaser.

II-5
<PAGE>
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 (the "Securities Act") may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.

The undersigned Registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities Act,
the information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.

(2) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.

II-6
<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Fort Wayne, State of
Indiana, on February 19, 1997.

<TABLE>
<S> <C> <C>
BCP/ESSEX HOLDINGS, INC.
(Registrant)

By: /s/ STEVEN R. ABBOTT
------------------------------------------
Steven R. Abbott
PRESIDENT AND CHIEF EXECUTIVE OFFICER
</TABLE>

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints each of Steven R. Abbott, Robert D. Lindsay and
David A. Owen, or any of them, each acting alone, his true and lawful
attorney-in-fact and agent, with full power of substitution and resubstitution,
for such person and in his name, place and stead, in any and all capacities, in
connection with the Registrant's Registration Statement on Form S-1 under the
Securities Act of 1933, including to sign the Registration Statement in the name
and on behalf of the Registrant or on behalf of the undersigned as a director or
officer of the Registrant, and any and all amendments or supplements to the
Registration Statement, including any and all stickers and post-effective
amendments to the Registration Statement and to sign any and all additional
registration statements relating to the same offering of securities as those
that are covered by the Registration Statement that are filed pursuant to Rule
462(b) under the Securities Act of 1933, and to file the same, with all exhibits
thereto, and other documents in connection therewith, with the Securities and
Exchange Commission and any applicable securities exchange or securities
self-regulatory body, granting unto said attorneys-in-fact and agents, each
acting alone, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the premises, as fully for
all intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or their substitutes or
substitute, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ---------------------------------- ------------------------------------- -----------------
<C> <S> <C>
/s/ STEVEN R. ABBOTT President, Chief Executive Officer February 19, 1997
- --------------------------------- and Director (Principal Executive
Steven R. Abbott Officer)
/s/ DAVID A. OWEN Executive Vice President, Chief February 19, 1997
- --------------------------------- Financial Officer and Treasurer
David A. Owen (Principal Financial and Accounting
Officer)
/s/ RODNEY A. COHEN Director February 19, 1997
- ---------------------------------
Rodney A. Cohen
/s/ ROBERT D. LINDSAY Director February 19, 1997
- ---------------------------------
Robert D. Lindsay
/s/ JOSEPH H. GLEBERMAN Director February 19, 1997
- ---------------------------------
Joseph H. Gleberman
/s/ JOHN E. PHIPPS Director February 19, 1997
- ---------------------------------
John E. Phipps
/s/ WARD W. WOODS Director February 19, 1997
- ---------------------------------
Ward W. Woods
</TABLE>

II-7
<PAGE>
SCHEDULE I

BCP/ESSEX HOLDINGS INC.

PARENT COMPANY ONLY CONDENSED BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31,
------------------------
1995 1996
----------- -----------
<S> <C> <C>
IN THOUSANDS OF DOLLARS
ASSETS
Cash and cash equivalents............................................................... $ 38 $ 1,530
Refundable income taxes................................................................. 3,062 1,211
Due from Essex Group, Inc. ............................................................. 384 5,153
Investment in Essex Group, Inc.......................................................... 114,678 151,066
----------- -----------
$ 118,162 $ 158,960
----------- -----------
----------- -----------

LIABILITIES AND STOCKHOLDERS' EQUITY
Accrued liabilities..................................................................... $ 239 $ 244
Preferred stock......................................................................... 48,820 --
Common stock subject to put............................................................. 4,803 12,626
Other stockholders' equity:
Common stock ....................................................................... 168 228
Additional paid in capital ......................................................... 85,779 133,526
Carryover of Predecessor basis ..................................................... (15,259) (15,259)
Retained earnings (deficit)......................................................... (6,388) 27,595
----------- -----------
64,300 146,090
----------- -----------
$ 118,162 $ 158,960
----------- -----------
----------- -----------
</TABLE>

See Note to Condensed Financial Statements

S-1
<PAGE>
SCHEDULE I
(CONTINUED)

BCP/ESSEX HOLDINGS INC.

PARENT COMPANY ONLY CONDENSED STATEMENTS OF INCOME

<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31,
1994 1995 1996
--------- -------------- ---------
<S> <C> <C> <C>
IN THOUSANDS OF DOLLARS
------------------------------------
Costs and Expenses:
Interest expense ....................................................... $ 36,165 $ 14,476 $ --
Other expense, net ..................................................... (280) 47 63
--------- -------------- ---------
Loss before income taxes, equity in earnings of subsidiary, and
extraordinary charge ................................................... (35,885) (14,523) (63)
Income tax benefit ....................................................... (13,200) (5,300) --
--------- -------------- ---------
Loss before equity in earnings of subsidiary and extraordinary charge..... (22,685) (9,223) (63)
Equity in earnings of Essex Group, Inc. before extraordinary charge ...... 30,171 22,494 37,571
--------- -------------- ---------
Income before extraordinary charge ....................................... 7,486 13,271 37,508
Equity in Essex Group, Inc. extraordinary charge-net of income tax
benefit................................................................. -- 2,971 1,183
--------- -------------- ---------
Net income ............................................................... $ 7,486 $ 10,300 $ 36,325
--------- -------------- ---------
--------- -------------- ---------
</TABLE>

See Note to Condensed Financial Statements

S-2
<PAGE>
SCHEDULE I
(CONTINUED)

BCP/ESSEX HOLDINGS INC.

PARENT COMPANY ONLY CONDENSED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31,
1994 1995 1996
---------- -------------- ------------
<S> <C> <C> <C>
IN THOUSANDS OF DOLLARS
OPERATING ACTIVITIES
Net income........................................................... $ 7,486 $ 10,300 $ 36,325
Adjustments to reconcile net income to cash provided by operating
activities:
Equity in earnings of Essex Group, Inc............................. (30,171) (19,523) (36,388)
Non cash interest expense.......................................... 36,183 14,476 --
Provision for deferred income taxes................................ 575 1,511 --
Loss on repurchase of debt......................................... 187 -- --
Changes in operating assets and liabilities:
Increase (decrease) in accounts payable and accrued liabilities.... 2,262 (3,708) 73
(Increase) decrease in amount due from Essex Group, Inc............ (14,616) 32,595 (4,769)
(Increase) decrease in other assets................................ 2,704 (1,555) 1,851
---------- -------------- ------------
NET CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES............. 4,610 34,096 (2,908)
---------- -------------- ------------
FINANCING ACTIVITIES
Preferred stock redemption........................................... -- -- (59,277)
Common stock issuance................................................ -- -- 63,677
Dividend received from Essex Group, Inc.............................. -- 238,748 --
Proceeds from exercised stock options................................ 21 -- --
Repurchase of senior discount debentures............................. (4,745) (272,850) --
---------- -------------- ------------
NET CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES............. (4,724) (34,102) 4,400
---------- -------------- ------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS................... (114) (6) 1,492
Cash and cash equivalents at beginning of year....................... 158 44 38
---------- -------------- ------------
Cash and cash equivalents at end of year............................. $ 44 $ 38 $ 1,530
---------- -------------- ------------
---------- -------------- ------------
</TABLE>

See Note to Condensed Financial Statements

S-3
<PAGE>
SCHEDULE I
(CONTINUED)

BCP/ESSEX HOLDINGS INC.

PARENT COMPANY ONLY CONDENSED FINANCIAL STATEMENTS

NOTE TO CONDENSED FINANCIAL STATEMENTS

Detailed notes to consolidated financial statements of BCP/Essex Holdings
Inc. ("Holdings") are included beginning on page F-6.

Holdings is beneficially owned by Bessemer Holdings, L.P., members of
management, other current and former employees of Essex Group, Inc. ("Essex")
and certain other investors. Holdings is the holding company for Essex. The
principal asset of Holdings is all of the outstanding common stock of Essex. The
investment in Essex is accounted for using the equity method for this
presentation. All of such stock is pledged to the lenders of Essex under bank
financing agreements. Generally, Holdings has no source of income other than the
earnings, if any, of Essex.

Holdings and Essex file a consolidated U.S. federal income tax return. Under
a tax sharing agreement, Essex' aggregate income tax liability is calculated as
if it were to file a separate return with its subsidiaries.

S-4
<PAGE>
SCHEDULE II

BCP/ESSEX HOLDINGS INC.

VALUATION AND QUALIFYING ACCOUNTS

<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------------------
1994 1995 1996
--------- -------------- ---------
<S> <C> <C> <C>
IN THOUSANDS OF DOLLARS
Allowance for doubtful accounts:
Balance at beginning of year .............................................. $ 2,811 $ 3,537 $ 3,930
Provision.................................................................. 1,332 676 1,782
Write-offs ................................................................ (900) (476) (738)
Recoveries ................................................................ 294 193 265
--------- ------- ---------
Balance at end of year .................................................... $ 3,537 $ 3,930 $ 5,239
--------- ------- ---------
--------- ------- ---------
</TABLE>

S-5
<PAGE>
EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT
NO.
- ---------
<C> <S>

*1.1 --Form of U.S. Underwriting Agreement

*1.2 --Form of International Underwriting Agreement

*3.1 --Form of Second Amended and Restated Certificate of Incorporation of the Registrant

*3.2 --Form of By-laws of the Registrant

4.5 --Credit Agreement dated as of October 31, 1996, among the Registrant, Essex Group, Inc., the lenders
named therein and The Chase Manhattan Bank, as administrative agent, incorporated by reference to
Exhibit 10.1 to the Registrant's Quarterly Report on Form 10-Q, filed with the Commission on November
13, 1996 (Commission File No. 1-10211)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO.
- ---------
<C> <S>
4.6 --Senior Unsecured Note Agreement dated as of April 12, 1995, among the Registrant, as guarantor, Essex
Group, Inc., the lenders named therein and The Chase Manhattan Bank, as administrative agent,
incorporated by reference to Exhibit 10.2 to the Registrant's Quarterly Report on Form 10-Q, filed with
the Commission on May 12, 1995 (Commission File No. 1-10211)

*5 --Opinion of Cravath, Swaine & Moore

10.2 --Amendment dated October 9, 1992 among Bessemer Capital Partners, L.P., B E Acquisition Corporation,
Donaldson, Lufkin & Jenrette Securities Corporation and Goldman, Sachs & Co., to Engagement Letter
dated July 22, 1992 among Bessemer Capital Partners, L.P. and Donaldson, Lufkin & Jenrette Securities
Corporation, incorporated by reference to Exhibit 10.11 to the Essex Annual Report on Form 10-K for
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NO.
- ---------
the fiscal year ended December 31, 1992 (Commission file No. 1-74181)
<C> <S>

*10.7 --Registration Rights Agreement between Bessemer Holdings, L.P. and the Registrant

*11.1 --Earnings per share

21.1 --Subsidiaries of the Registrant

23.1 --Consent of Ernst & Young LLP

*23.2 --Consent of Cravath, Swaine & Moore

24. --Powers of Attorney (included in signature page)

- ------------------------

* To be filed by amendment

<PAGE>
EXHIBIT 21.01

BCP/ESSEX HOLDINGS INC. (DELAWARE)

SUBSIDIARIES OF THE REGISTRANT

<TABLE>
<S> <C>
Essex Group, Inc......................................................... Michigan

Essex Group, Inc......................................................... Delaware

Essex International, Inc................................................. Delaware

Essex Wire Corporation................................................... Michigan

Diamond Wire & Cable Co.................................................. Illinois

US Samica Corporation.................................................... Vermont

Essex Group Export Inc................................................... U.S. Virgin
Islands

Interstate Industries Holdings Inc....................................... Delaware

Interstate Industries, Inc............................................... Mississippi

Essex Group Mexico Inc................................................... Delaware

Essex Group Mexico, S.A. de C.V.......................................... Mexico

SX Mauritius Holding Inc................................................. Mauritius
</TABLE>

<PAGE>
EXHIBIT 23.1

CONSENT OF INDEPENDENT AUDITORS

We consent to the reference to our firm under the caption "Experts" and to
the use of our report dated January 28, 1997 (except for Note 13, as to which
the date is , 1997), in the Registration Statement (Form S-1 No.
333-xxxxx) and related Prospectus of BCP/Essex Holdings Inc. for the
registration of shares of its common stock.

We have audited the consolidated financial statements of BCP/Essex Holdings
Inc. as of December 31, 1996 and 1995 and for each of the three years in the
period ended December 31, 1996 and have issued our report thereon dated January
28, 1997 (except Note 13, as to which the date is February 19, 1997). Our audits
also included the financial statement schedules listed in Item 16(b) of this
Registration Statement. These schedules are the responsibility of the Company's
management. Our responsibility is to express an opinion based on our audits.

In our opinion, the financial statement schedules referred to above, when
considered in relation to the basic financial statements taken as a whole,
present fairly in all material respects the information set forth therein.

Ernst & Young LLP

Indianapolis, Indiana

The foregoing consent is in the form that will be signed upon the completion
of recapitalization described in Note 13 to the consolidated financial
statements.

/s/ Ernst & Young LLP

Indianapolis, Indiana
February 19, 1997