<PAGE> 1
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended March 31, 1998
Commission File No. 1-12983
GENERAL CABLE CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 06-1398235
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
4 Tesseneer Drive
Highland Heights, KY 41076
(Address of principal executive offices)
(606) 572-8000
(Registrant's telephone number, including area code)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes __X__ No ____
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at April 17, 1998
----- -----------------------------
Common Stock, $.01 Par Value 24,533,593
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PAGE 1
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GENERAL CABLE CORPORATION
INDEX TO QUARTERLY REPORT
ON FORM 10-Q
PART I - FINANCIAL INFORMATION Page
----
Item 1. Consolidated Financial Statements
Statements of Income -
For the three months ended March 31, 1998 and 1997 3
Balance Sheets -
March 31, 1998 and December 31, 1997 4
Statements of Cash Flows -
For the three months ended March 31, 1998 and 1997 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 13
SIGNATURE 14
2
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GENERAL CABLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(IN MILLIONS, EXCEPT PER SHARE DATA)
(UNAUDITED)
Three Months Ended
March 31,
---------
1998 1997
---- ----
Net sales $ 278.6 $ 251.0
Cost of sales 221.6 202.2
------- -------
Gross profit 57.0 48.8
Selling, general and administrative expenses 31.3 29.6
------- -------
Operating income 25.7 19.2
------- -------
Interest income (expense):
Interest expense (3.8) (5.1)
Interest income 0.3 0.2
------- -------
(3.5) (4.9)
------- -------
Earnings before income taxes 22.2 14.3
Income tax provision (8.7) (5.7)
------- -------
Net income $ 13.5 $ 8.6
========= =========
Earnings per common share $ 0.55 $ 0.35
========= =========
Weighted average common shares 24.5 24.3
========= =========
Earnings per common share-assuming dilution $ 0.54 $ 0.35
========= =========
Weighted average common shares-assuming dilution 25.1 24.3
========= =========
See accompanying Notes to Consolidated Financial Statements.
3
<PAGE> 4
GENERAL CABLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(IN MILLIONS, EXCEPT SHARE DATA)
March 31, December 31,
ASSETS 1998 1997
- ------ ---- ----
Current Assets: (unaudited)
Cash $ 7.7 $ 4.2
Receivables, net 169.1 162.4
Inventories 171.9 163.6
Deferred income taxes 20.7 20.9
Prepaid expenses and other 11.9 10.7
------ ------
Total current assets 381.3 361.8
Property, plant and equipment, net 165.8 155.6
Deferred income taxes 28.8 29.2
Other non-current assets 16.7 17.1
------ ------
Total assets $592.6 $563.7
====== ======
LIABILITIES AND SHAREHOLDERS' EQUITY
- ------------------------------------
Current Liabilities:
Accounts payable $ 82.2 $ 80.5
Accrued liabilities 61.7 55.4
------ ------
Total current liabilities 143.9 135.9
Long-term debt 248.3 238.5
Other liabilities 64.9 66.9
------ ------
Total liabilities 457.1 441.3
------ ------
Shareholders' Equity:
Common stock, $0.01 par value:
Issued and outstanding shares:
March 31, 1998 - 24,534,307
December 31, 1997 - 24,515,426 0.2 0.2
Additional paid-in capital 84.3 83.5
Retained earnings 51.0 38.7
------ ------
Total shareholders' equity 135.5 122.4
------ ------
Total liabilities and shareholders' equity $592.6 $563.7
====== ======
See accompanying Notes to Consolidated Financial Statements.
4
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GENERAL CABLE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN MILLIONS)
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
---------------------------
1998 1997
---- ----
<S> <C> <C>
Cash flows of operating activities:
Net income $ 13.5 $ 8.6
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation 4.1 3.3
Deferred income taxes 0.6 0.7
Changes in operating assets and liabilities:
Increase in receivables (6.7) (20.7)
Increase in inventories (8.3) (4.6)
Increase in other assets (1.4) (1.3)
Increase (decrease) in accounts payable,
accrued and other liabilities 6.0 (4.2)
------ ------
Net cash flows of operating activities 7.8 (18.2)
------ ------
Cash flows of investing activities:
Capital expenditures (14.5) (4.0)
Proceeds from the sale of property 1.5 --
Other, net 0.1 0.2
------ ------
Net cash flows of investing activities (12.9) (3.8)
------ ------
Cash flows of financing activities:
Dividends paid (1.2) --
Net borrowings of revolving credit facility 10.0 --
Proceeds from issuance of other debt -- 23.2
Repayment of other long-term debt (0.2) (0.2)
------ ------
Net cash flows of financing activities 8.6 23.0
------ ------
Increase in cash 3.5 1.0
Cash-beginning of period 4.2 1.9
------ ------
Cash-end of period $ 7.7 $ 2.9
====== ======
SUPPLEMENTAL INFORMATION
Income taxes paid, net of refunds $ 0.2 $ 1.9
====== ======
Interest paid $ 3.0 $ 0.1
====== ======
</TABLE>
See accompanying Notes to Consolidated Financial Statements.
5
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GENERAL CABLE CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
PRINCIPLES OF CONSOLIDATION The consolidated financial statements include the
accounts of General Cable Corporation and its wholly owned subsidiaries. All
transactions and balances among the consolidated companies have been eliminated.
Certain reclassifications have been made to the prior year to conform to the
current year's presentation.
BASIS OF PRESENTATION The accompanying unaudited consolidated financial
statements of General Cable Corporation and Subsidiaries have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q and Article 10 of Regulation
S-X. Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete annual
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Results of operations for the three months ended March 31, 1998
are not necessarily indicative of results that may be expected for the full
year. These financial statements should be read in conjunction with the audited
financial statements and notes thereto in General Cable's 1997 Annual Report on
Form 10-K filed with the Securities and Exchange Commission on March 30, 1998.
NEW STANDARDS In June 1997, the Financial Accounting Standards Board issued SFAS
No. 130, "Reporting Comprehensive Income" and SFAS No. 131, "Disclosures about
Segments of an Enterprise and Related Information". SFAS No. 130 was adopted
during the first quarter of 1998. However, management believes the disclosure
provisions of SFAS No. 130 are not material to its consolidated financial
statements. General Cable will be required to adopt SFAS No. 131 during 1998.
Adoption of SFAS No. 131 will not impact the reported results of operations or
financial position of General Cable; however, General Cable is planning to
disclose additional information related to the Electrical and Communications
Groups when SFAS No. 131 is implemented.
2. INVENTORIES
Inventories consisted of the following (in millions):
March 31, December 31,
1998 1997
--------- ------------
Raw materials $ 20.1 $ 20.7
Work-in-progress 24.1 28.4
Finished goods 127.7 114.5
------ ------
Total $171.9 $163.6
====== ======
At March 31, 1998 and December 31, 1997, $73.3 million and $70.7
million, respectively, of inventories were valued using the LIFO method.
Approximate replacement cost of inventories valued using the LIFO method totaled
$62.9 million at March 31, 1998 and $59.3 million at December 31, 1997. An
actual valuation of inventory under the LIFO method can be made only at the end
of each year based on the inventory levels and costs at that time. Accordingly,
interim LIFO calculations are necessarily based on management's estimates of
expected year-end inventory levels and costs. Because these are subject to many
variables beyond management's control, interim results are subject to the final
year-end LIFO inventory valuation.
6
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GENERAL CABLE CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
3. SHAREHOLDERS' EQUITY
Changes in shareholders' equity were as follows (in millions):
<TABLE>
<CAPTION>
Additional
Common Paid-In Retained
Stock Capital Earnings Total
----- ------- -------- -----
<S> <C> <C> <C> <C>
Balance, December 31, 1997 $ 0.2 $ 83.5 $ 38.7 $ 122.4
Net income -- -- 13.5 13.5
Dividends -- -- (1.2) (1.2)
Issuance of Restricted Stock -- 0.8 -- 0.8
------ ------- ------- --------
Balance, March 31, 1998 $ 0.2 $ 84.3 $ 51.0 $ 135.5
====== ======= ======= ========
</TABLE>
4. EARNINGS PER SHARE
A reconciliation of the numerator and denominator of earnings per common share
to earnings per common share assuming dilution for the three months ended March
31, 1998 is as follows (in millions):
<TABLE>
<CAPTION>
Income Shares Per Share
(Numerator) (Denominator) Amount
----------- ------------- ------
<S> <C> <C> <C>
Earnings per common share $13.5 24.5 $0.55
=====
Dilutive effect of stock options -- 0.6
----- ----
Earnings per common share - assuming dilution $13.5 25.1 $0.54
===== ==== =====
</TABLE>
Earnings per common share and earnings per common share assuming dilution for
the three months ended March 31, 1997 were computed based upon 24.3 million
average shares outstanding. There were no dilutive securities outstanding during
the first quarter of 1997.
5. SUBSEQUENT EVENT
On April 17, 1998, the Company's Board of Directors declared a 3-for-2 stock
split in the form of a 50 percent stock dividend that will be distributed to
shareholders of record as of April 28, 1998. The stock dividend will increase
the number of shares of common stock outstanding to approximately 36.8 million
shares.
7
<PAGE> 8
GENERAL CABLE CORPORATION AND SUBSIDIARIES
ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
GENERAL
General Cable is a leader in the development, design, manufacture,
marketing and distribution of copper, aluminum and optical fiber wire and cable
products for the communications and electrical markets. Communications wire and
cable transmits low voltage signals for voice, data, video and control
applications. Electrical wire and cable conducts electrical current for power
and control applications. General Cable believes that its principal competitive
strengths include its breadth of product line; brand recognition; distribution
and logistics; customer relationships, sales and service; and improved operating
efficiency.
All statements, other than statements of historical fact, included in this
report, including the statements under "Management's Discussion and Analysis of
Financial Condition and Results of Operations", are, or may be considered,
forward-looking statements under Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. Important factors that could
cause results to differ materially from those discussed in the forward-looking
statements (Cautionary Statements) include: price competition, particularly in
certain segments of the building wire and cordset markets, and other competitive
pressures; general economic conditions, particularly those affecting the
non-residential construction industry; the Company's ability to retain key
customers and distributors; the Company's ability to increase manufacturing
capacity; the cost of raw materials, including copper; the level of growth in
demand for products serving various segments of the communications markets; the
Company's ability to introduce successfully new or enhanced products; the impact
of qualified technological changes; the Company's ability to achieve
productivity improvements; and the impact of changes in industry standards and
the regulatory environment. All subsequent written and oral forward-looking
statements attributable to the Company or persons acting for the Company are
qualified in their entirety by the Cautionary Statements.
General Cable's reported net sales are directly influenced by the price
of copper. Copper prices have been volatile, with the copper cathode daily
selling price on the COMEX averaging $1.11 per pound during the first quarter of
1997 and $0.78 per pound for the first quarter of 1998. However, as a result of
a number of practices intended to match copper purchases with sales, the
Company's overall profitability has not been significantly affected by changing
copper prices. General Cable generally passes changes in copper prices along to
its customers, although there are timing delays of varying lengths depending
upon the type of product, competitive conditions and particular customer
arrangements. General Cable does not engage in speculative metals trading or
other speculative activities. Also, the Company does not engage in activities to
hedge the underlying value of its copper inventory.
8
<PAGE> 9
GENERAL CABLE CORPORATION AND SUBSIDIARIES
General Cable generally experiences certain seasonal trends in sales and
cash flow. Larger amounts of cash are generally required during the first and
second quarters of the year to build inventories in anticipation of higher
demand during the spring and summer, when construction activity increases. In
general, receivables related to higher sales activity during the spring and
summer are collected in the third and fourth quarters of the year.
RESULTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 1998 COMPARED WITH THREE MONTHS ENDED MARCH 31,
1997
General Cable continued to achieve improved results in earnings per share
and return on net assets in the first quarter of 1998. Fully diluted earnings
per share increased 54% to $0.54, up from $0.35 per share in the first quarter
of 1997. Earnings increased significantly as a result of substantially higher
sales volume and the results of the Company's continuing productivity
improvement initiatives. In addition, return on net assets for the quarter of
14.7% was up 3.8 points over the same period in the prior year.
Net sales increased 11% to $278.6 million for the first quarter of 1998,
up from $251.0 million for the same period in 1997 despite a $0.33 decrease in
the average monthly COMEX price per pound of copper in the three months ended
March 31, 1998 compared to the same period in 1997.
After adjusting the 1997 net sales to reflect the $0.33 lower average
price per pound of copper in the first quarter of 1998, net sales were actually
$54.6 million, or 24%, higher than the first quarter of 1997. The increase in
copper-adjusted net sales reflected a 10% increase in the copper-adjusted net
sales of Electrical products and a 55% increase in the copper-adjusted net sales
of Communications products.
The growth in Communications products was fueled by substantially higher
sales of plastic insulated cable (PIC) to established regional bell operating
company customers as well as the addition of a major new Local Exchange Carrier
customer that General Cable did not serve in the first quarter of 1997. PIC
sales through key distributor customers were also up substantially. In addition,
copper-adjusted net sales of datacom products were up almost 40% with the
largest increases coming in high performance enhanced category cables. The sales
growth in Communication products continues to be driven by the ongoing
proliferation of personal computers, and growth in Internet use, local and wide
area networks, high speed modems and access lines, and advanced voice, data and
video applications. The growth in Electrical products sales was primarily due to
increased volume of building wire and portable cord in the first quarter of 1998
compared to the same period in 1997. Capitalizing on "The Power of One"
strategy, General Cable continued to show excellent sales growth with key
customers. Copper-adjusted net sales to our top 20 customers increased 48%,
twice the overall copper-adjusted growth rate, reflecting General Cable's
continuing ability to partner with customers for mutually beneficial growth in
revenues and earnings.
9
<PAGE> 10
GENERAL CABLE CORPORATION AND SUBSIDIARIES
Despite substantial top-line growth, selling, general and administrative
expenses increased only 6% to $31.3 million in the first quarter of 1998 from
$29.6 million in the first quarter of 1997 primarily reflecting higher volume -
related expenses such as transportation, and higher salary and related costs,
primarily in engineering and supply chain management, to support the Company's
sales growth. During the first quarter of 1998, we continued to leverage our
sales growth as evidenced by the fact that selling, general and administrative
expenses as a percentage of copper-adjusted net sales declined from 13.2% in the
first quarter of 1997, to 11.2% in the first quarter of 1998.
Operating profit increased 34% to $25.7 million in the first quarter of
1998 from $19.2 million in the first quarter of 1997. The substantial
improvement in operating profit reflects the 24% increase in copper-adjusted
sales, manufacturing cost reductions, including process improvements to reduce
material costs, improved material usage, and capital investment to improve
productivity and throughput, and selling, general and administrative expense
productivity. These were partially offset by higher costs associated with
temporarily purchasing PIC product from third parties at a cost in excess of
General Cable's manufacturing cost to satisfy PIC demand in excess of present
capacity, and slightly lower building wire pricing. General Cable brought
additional PIC capacity on stream at its Bonham, Texas plant in mid-February
1998 and at its Lawrenceburg, Kentucky plant throughout the first quarter.
Another major capacity addition is underway at Lawrenceburg for start-up by
July, 1998. These capacity additions will reduce the adverse effect on operating
margins of outsourcing PIC products through the balance of the year.
Net interest expense was $3.5 million in the first quarter of 1998
compared to $4.9 million in the first quarter of 1997. The reduction reflects
the impact of refinancing related party debt in May 1997 with borrowing under a
new credit facility at a lower effective interest rate.
The effective income tax rate for the first quarter of 1998 was 39%
compared to approximately 40% for the first quarter of 1997.
PRO FORMA RESULTS
The following pro forma results for the three months ended March 31, 1997
give effect to the refinancing of related party debt as if it had occurred as of
the beginning of 1997. The pro forma financial data are for informational
purposes only and may not necessarily be indicative of the results of operations
had the refinancing actually occurred on such date.
Three Months Ended March 31,
----------------------------
Pro Forma
1998 1997 %Increase
----- ----- ---------
Pro forma net income $13.5 $ 9.5 42%
===== ===== ===
Pro forma earnings per share $0.55 $0.39 41%
===== ===== ===
Pro forma earnings per share -
assuming dilution $0.54 $0.39 38%
===== ===== ===
10
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GENERAL CABLE CORPORATION AND SUBSIDIARIES
LIQUIDITY AND CAPITAL RESOURCES
In general, General Cable requires cash for working capital, capital
expenditures, debt repayment, interest and taxes. General Cable's working
capital requirements increase when it experiences strong incremental demand for
products and/or significant copper price increases.
Cash flow provided by operating activities in the first three months of
1998 was $7.8 million. Net income before depreciation and deferred taxes of
$18.2 million and a $6.0 million increase in accounts payable, accrued
liabilities and other long-term liabilities were partially offset by a $1.4
million increase in other assets, a $6.7 million increase in accounts receivable
and an $8.3 million increase in inventories. The increase in accounts receivable
was due to the strong growth in sales in the last two months of the first
quarter of 1998 compared to the last two months of the fourth quarter of 1997.
The increase in inventory was due to a build of inventories in anticipation of
increased seasonal demand in the second and third quarters of 1998. These
increases were partially offset by an 8% improvement in inventory turnover as
the efficiencies from the rollout of the Company's regional distribution centers
continue to be realized.
Cash flow used in investing activities was $12.9 million in the first three
months of 1998, principally reflecting $14.5 million of capital expenditures,
primarily focused on increased capacity and improved manufacturing productivity.
Cash flow provided by financing activities in the first three months of
1998 was $8.6 million, primarily reflecting proceeds of borrowings of $10.0
million under General Cable's revolving credit line, partially offset by $1.2
million of dividends paid during the quarter.
In May 1997, as part of the initial public offering of common stock,
General Cable entered into a new $350.0 million credit facility with The Chase
Manhattan Bank as administrative agent, and a syndicate of banks (the Credit
Facility). The Credit Facility consists of a five-year senior unsecured
revolving credit and competitive advance facility in an aggregate principal
amount of $350.0 million. Borrowings are guaranteed by General Cable's principal
operating subsidiaries.
General Cable made an initial borrowing of $268.0 million and used the
proceeds of such borrowing to (i) repay all of its revolving bank debt, (ii)
repay all intercompany debt and advances owed to Wassall and its subsidiaries;
(iii) pay $42.6 million as a dividend to Wassall; (iv) pay $2.0 million for the
purchase of two related companies, Carol Cable Europe Ltd. and Carol Cable Ltd.,
from Wassall; and (v) pay expenses of the refinancing of $0.4 million.
Borrowings under the Credit Facility were $240.0 million at March 31, 1998.
The Credit Facility loans bear interest, at General Cable's option, at (i)
a spread over LIBOR or (ii) the Alternate Base Rate, which is defined as the
higher of (a) the Agent's Prime Rate, (b) the secondary market rate for
certificates of deposit (adjusted for reserve requirements) plus 1% or (c) the
Federal Funds Effective Rate.
11
<PAGE> 12
GENERAL CABLE CORPORATION AND SUBSIDIARIES
In November 1997, General Cable entered into interest rate swap agreements
with the three banks which effectively fix interest rates for specific amounts
borrowed under the Credit Facility as follows (dollars in millions):
Fixed
Notional Interest
Period Amounts Rate
------ ------- ----
November 1997 to November 1998 $180.0 5.9%
November 1998 to November 1999 125.0 6.2%
November 1999 to November 2000 75.0 6.2%
November 2000 to November 2001 25.0 6.2%
A facility fee accrues on the full amount of the Credit Facility,
regardless of usage. The facility fee ranges between 8.0 and 20.0 basis points
per annum and the spread over LIBOR ranges between 17.0 and 42.5 basis points
per annum. Both the facility fee and the spread over LIBOR are subject to
periodic adjustment depending upon General Cable's Leverage Ratio. As a result
of the Company's strong financial performance in 1997, both the facility fee and
the spread over LIBOR were adjusted down effective March 31, 1998 to the minimum
amount provided under the Credit Facility.
The Credit Facility restricts certain corporate acts and contains required
minimum financial ratios and other covenants. An amendment to the Credit
Facility agreement dated April 17, 1998 eliminated the prior limitation of
annual dividends to an aggregate maximum of $0.20 per share outstanding as of
the immediately preceding fiscal year. However, aggregate annual dividends will
still generally be restricted to 50% of the net income in the preceding fiscal
year as stated in the original agreement.
12
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GENERAL CABLE CORPORATION AND SUBSIDIARIES
PART II - OTHER INFORMATION
---------------------------
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
10.1 - Amendment dated April 17, 1998 to the
Credit Agreement dated May 14, 1997 between the Company,
Chase Manhattan Bank, as Administrative Agent and the
lenders
27.1 - Financial Data Schedule
(b) Reports on Form 8-K - None
13
<PAGE> 14
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, General
Cable Corporation has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
GENERAL CABLE CORPORATION
Signed: April 27, 1998 By: s/CHRISTOPHER F. VIRGULAK
--------------------------
Christopher F. Virgulak
Executive Vice President, Chief
Financial Officer and Treasurer
14
<PAGE> 1
EXHIBIT 10.1
AMENDMENT dated as of April 17, 1998, to the Credit Agreement
dated as of May 14, 1997 (the "Credit Agreement"), among GENERAL CABLE
CORPORATION, the BORROWING SUBSIDIARIES party thereto, the LENDERS party
thereto, and THE CHASE MANHATTAN BANK, as Administrative Agent. Capitalized
terms used and not defined herein shall have the meanings assigned to such terms
in the Credit Agreement.
WHEREAS the Company has requested the Lenders to amend the
Credit Agreement as set forth herein; and
WHEREAS the Required Lenders are willing to approve such
amendment, subject to the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual agreements
contained in this Amendment and other good and valuable consideration, the
sufficiency and receipt of which are hereby acknowledged, the parties hereto
hereby agree as follows:
SECTION 1. Amendments. Section 6.06 of the Credit Agreement is
hereby amended, as of the date of this Amendment, so that the following language
is deleted:
"provided, that in no event shall any cash dividends,
repurchases or redemptions payable under this clause (x) exceed the greater of
$0.20 per fiscal year per share of the Borrower's common stock outstanding at
the end of the immediately preceding fiscal year and the cash dividends,
repurchases and redemptions made in the immediately preceding fiscal year;".
SECTION 2. Representations and Warranties. The Company
represents and warrants to each of the Lenders, on and as of the date hereof,
that:
(a) The representations and warranties of each Loan Party set
forth in each Loan Document, after giving effect to this Amendment, are true and
correct on and as of the date hereof.
(b) Before and after giving effect to this Amendment, no
Default has occurred and is continuing.
SECTION 3. Applicable Law. THIS AMENDMENT SHALL BE CONSTRUED
IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
SECTION 4. Existing Credit Agreement. Until the delivery of
executed counterparts hereof to the Administrative Agent by the Company and the
Required Lenders, the Credit Agreement shall continue in full force and effect
in accordance with the provisions thereof and the rights and obligations of the
parties thereto shall not be affected hereby.
<PAGE> 2
SECTION 5. Amended Credit Agreement. Any reference in the
Credit Agreement, or in any documents or instruments required thereunder or
annexes or schedules thereto, referring to the Credit Agreement shall be deemed
to refer to the Credit Agreement as amended by this Amendment. As used in the
Credit Agreement, the terms "Agreement", "this Agreement", "herein",
"hereinafter", "hereto", "hereof" and words of similar import shall, unless the
context otherwise requires, mean the Credit Agreement as amended by this
Amendment. Except as expressly modified by this Amendment, the terms and
provisions of the Credit Agreement are hereby confirmed and ratified in all
respects and shall remain in full force and effect.
SECTION 6. Counterparts. This Amendment may be executed in two
or more counterparts, each of which shall constitute an original but all of
which when taken together shall constitute but one contract. Delivery of an
executed counterpart of a signature page by facsimile transmission shall be
effective as delivery of a manually executed counterpart of this Amendment.
SECTION 7. Expenses. The Company agrees to reimburse the
Administrative Agent for its reasonable out-of-pocket expenses in connection
with this Amendment, including the reasonable fees, charges and disbursements of
Cravath, Swaine & Moore, counsel for the Administrative Agent.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed by their respective authorized officers as of the
day and year first written above.
/s/ GENERAL CABLE CORPORATION
/s/ THE CHASE MANHATTAN BANK
/s/ PNC BANK, OHIO, NATIONAL ASSOCIATION
/s/ THE BANK OF NEW YORK
/s/ THE BANK OF TOKYO-MITSUBISHI CHICAGO BRANCH
/s/ CAISSE NATIONALE DE CREDIT AGRICOLE
/s/ CREDIT LYONNAIS CHICAGO BRANCH
/s/ THE FIFTH THIRD BANK OF NORTHERN KENTUCKY, INC.
/s/ THE FIRST NATIONAL BANK OF CHICAGO
/s/ THE FUJI BANK, LIMITED
/s/ KEYBANK NATIONAL ASSOCIATION
/s/ MELLON BANK, N.A.
/s/ NATIONAL CITY BANK OF DAYTON
/s/ THE SANWA BANK, LIMITED NEW YORK BRANCH
/s/ STAR BANK
/s/ MICHIGAN NATIONAL BANK
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED MARCH 31, 1998 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 7,700
<SECURITIES> 0
<RECEIVABLES> 176,600
<ALLOWANCES> 7,500
<INVENTORY> 171,900
<CURRENT-ASSETS> 381,300
<PP&E> 212,600
<DEPRECIATION> 46,800
<TOTAL-ASSETS> 592,600
<CURRENT-LIABILITIES> 143,900
<BONDS> 0
0
0
<COMMON> 200
<OTHER-SE> 135,300
<TOTAL-LIABILITY-AND-EQUITY> 592,600
<SALES> 278,600
<TOTAL-REVENUES> 278,600
<CGS> 221,600
<TOTAL-COSTS> 221,600
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 3,800
<INCOME-PRETAX> 22,200
<INCOME-TAX> 8,700
<INCOME-CONTINUING> 13,500
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 13,500
<EPS-PRIMARY> 0.55
<EPS-DILUTED> 0.54
</TABLE>
