<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
[X] Annual report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 (Fee required)
For the fiscal year ended December 31, 1996
or
[ ] Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 (No fee required)
For the transition period from __________ to ___________
Commission File No. 1-12280
BELDEN INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 76-0412617
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
7701 Forsyth Boulevard
Suite 800
St. Louis, Missouri 63105
(Address of Principal Executive Offices and Zip Code)
(314) 854-8000
(Registrant's Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(b) of the Act:
Name of Each Exchange
Title of Each Class on Which Registered
Common Stock, $.01 par value The New York Stock Exchange
Preferred Stock Purchase Rights The New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
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 requirement for the past 90 days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.
[X]
Exhibit Index on Pages 19-20
The aggregate market value of the registrant's voting stock held by non-
affiliates of the registrant at February 28, 1997 is $926,040,596.
The number of shares outstanding of the registrant's Common Stock at
February 28, 1997 is 26,119,962. <PAGE>
<PAGE>
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Belden Inc. Proxy Statement for the Annual Meeting of
Stockholders to be held on May 1, 1997 (the "Proxy Statement")
(incorporated by reference into Part III).
Portions of the 1996 Belden Inc. Annual Report to Shareholders (the "1996
Annual Report") (incorporated by reference into Parts I, II and IV).
- 2 -<PAGE>
<PAGE>
PART I
Item 1. Business
General
Belden is engaged in the design, manufacture and marketing of wire, cable
and cord products for electronics and electrical applications. It has been
in the business of manufacturing wire and cable for over 90 years. The
business was founded as Belden Manufacturing Company, which began
manufacturing silk insulated wire and insulated magnet wire in Chicago in
1902. In 1980, the business was acquired by Crouse-Hinds Company and, in
1981, by Cooper Industries, Inc. ("Cooper") as part of Cooper's acquisition
of Crouse-Hinds Company. From 1981 until July 1993, the business was
operated as an unincorporated division of Cooper. In 1993, the business
was transferred to Belden Wire & Cable Company ("BWC"), a wholly-owned
subsidiary of Belden Inc., in connection with the initial public offering
by Cooper, on October 6, 1993, of 23,500,000 shares of common stock of
Belden Inc. An additional 2,500,000 shares of common stock, which were
originally retained by Cooper, have all been sold to the public as of
December 31, 1996. For information regarding recent Belden acquisitions,
see "Note 3: Acquisitions" and "Note 4: Subsequent Event" of Belden's
consolidated financial statements in the 1996 Annual Report, incorporated
by reference in Item 8 of this Annual Report on Form 10-K.
Belden Inc. is a Delaware corporation incorporated in 1993. Substantially
all of its operations are conducted through BWC and its other subsidiaries.
As used herein, unless the context otherwise requires, "Belden" and the
"Company" refer to Belden Inc. and its subsidiaries and their respective
predecessors, including the Belden Division of Cooper.
Markets and Products
The Company designs, manufactures and markets wire, cable and cord products
that serve the following major markets:
- Computer networking, computer equipment and telecommunications
- Audio/video including broadcast, entertainment and cable television
- Industrial signal, instrumentation and control
- Electrical equipment, including power tools, floor care equipment,
home appliances, motor and test apparatus.
Belden meets the demands of those markets with various product
configurations, which include, for the electronic markets, multiconductor
products, coaxial cable, fiber optic cables, heat-shrinkable tubing and
wire management products; and for the electrical markets, cords and lead,
hook-up and other wire. A description of Belden's products follows,
including the major end uses and the methods of distribution.
Multiconductor Products
A multiconductor cable consists of two or more insulated conductors that
are cabled together, individually twisted into pairs or run in a parallel
configuration as a flat cable. Insulation may be extruded or laminated
over bare conductors, or separately insulated conductors may be bonded or
woven together. A cable may be unshielded, have individually shielded
pairs or have an overall shield. The cable is covered with an overall
jacket. Major end uses for these products include computer networking and
- 3 -<PAGE>
<PAGE>
computer equipment, as well as various applications within the industrial
signal, instrumentation and control market, and the telecommunications
market. Multiconductor product sales constituted approximately 49%, 46%
and 49% of Belden's sales in 1996, 1995 and 1994, respectively.
Computer Networking. Belden supplies both shielded and unshielded
multiconductor cables for local area network ("LAN") applications. A LAN
links together personal computers and other computer peripheral equipment.
Belden's multiconductor product line for the computer networking market
includes plenum cable, which is jacketed with special flame retardant
materials, and its DataTwist (R) cables for high speed transmission. It also
includes MediaTwist (TM) cables, which are multimedia cables supporting diverse
applications in video, data, and voice technologies. Belden's primary
channels to the computer networking market include distributors, computer
original equipment manufacturers ("OEMs") and systems integrators who
design and install multivendor data/voice systems.
Computer Equipment. The computer equipment market requires various
multiconductor and flat cables for use in internal computer component
wiring and to interconnect peripheral pieces of equipment, such as
printers, to computers. Computer hardware manufacturers also use flat
cable to interface internal components such as circuit boards, switching
devices and other active components. Such manufacturers also use heat-
shrinkable tubing and wire management products to protect and harness wire
and cable assemblies. Belden supplies multiconductor and flat cables, as
well as heat-shrinkable tubing and wire management products, for these
applications. Belden's primary channels to this market are direct sales to
computer and instrumentation OEMs and sales through assembly houses and
distributors.
Industrial Signal, Instrumentation and Control. The industrial signal,
instrumentation and control market requires a broad range of multiconductor
products for applications involving programmable controllers, robotics,
process control and computer-integrated manufacturing, as well as traffic
signal cable and cable for fire alarm, smoke detection, sprinkler control
and security systems. Many industrial environments require cables with
exterior armor or jacketing materials that can endure exposure to
chemicals, extreme temperatures and outside elements. Belden manufactures
and markets products that are designed for all these applications. Belden
also manufactures electrical wire used for the industrial power markets.
Belden sells products to the industrial signal, instrumentation and control
market primarily through wire specialist distributors, contractors and
engineering firms and also sells directly to OEMs.
Telecommunications. The telecommunications market utilizes a broad range
of products that transmit voice and data signals through the public
telephone network. Sophisticated network and switching equipment used in
many of the advanced telephone systems require a multiple pair cable that
is shielded for security purposes. In this telecommunications market,
Belden manufactures and markets multiconductor cables and sells them to
U.S. telephone suppliers and carriers as well as to national telephone
systems in Europe, and to OEMs that manufacture switching equipment sold
throughout the world. Belden has positioned itself to be a supplier of
service wire products to the telecommunication markets' "last mile"
architecture systems.
- 4 -<PAGE>
<PAGE>
Coaxial Cable
Coaxial cable consists of a central inner conductor surrounded by a
concentric outer conductor or shield. A dielectric material separates the
two conductors and a jacket covers the overall construction. The inner
conductor is usually copper or copper-covered steel, while the outer
conductor is usually a metallic tape or a wire braid. Various insulating
and jacketing materials are used. The primary applications for Belden's
coaxial cable are in audio/video markets such as broadcast, entertainment
and cable television. Belden's coaxial cable is also used in some computer
networking and computer equipment applications. Coaxial cable sales
constituted approximately 22%, 23% and 25% of Belden's sales in 1996, 1995
and 1994, respectively.
Broadcast and Entertainment. Belden's broadcast cables are used to
distribute audio and video signals for the television, music and other
entertainment industries. Belden primarily markets its broadcast cables
through broadcast specialty distributors and audio systems installers.
Cable Television. Belden manufactures flexible, copper-clad coaxial cable
used for the "drop" section of a cable television (CATV) system. The drop
cable section distributes the signal from the "trunk" portion of the CATV
system into the home. Belden has acquired a composite cable capability for
a combination of CATV and telephone pair to meet the changing needs of the
converging CATV and telecommunication markets. Belden also manufactures a
copper base trunk cable widely used throughout Europe meeting local
specifications within the region.
The CATV drop cable market includes both new cable installations and the
repair and replacement of existing cable. Belden's CATV coaxial cable is
sold directly to multiple systems operators who operate CATV systems
throughout the world and through CATV distributors, electronics
distributors and contractors.
Computer Networking and Computer Equipment. Computer coaxial cable is used
in some LAN applications and is also used to connect computer terminals to
mainframes. Belden's channel to this market is primarily through
distributors.
Fiber Optics
Fiber optic cables transmit light signals through glass or plastic fibers.
The principal application of Belden's fiber optic cable is premises data
distribution systems using multimode fiber. In these systems, fiber optic
cables are used to provide data communications between buildings in close
proximity or to provide a "backbone" to carry information between floors
within a building. Belden's channels to this market include distributors
and systems integrators. Belden also manufactures and sells fiber optic
single mode cable for applications in CATV and telecommunication markets.
These products are used to transmit voice, data, and video signals to a
subscriber network within an area serviced either by the local telephone
company or a CATV system operator. These sales are primarily made through
both direct relationships with the system operators and through multiple
distribution channels in the market.
- 5 -<PAGE>
<PAGE>
Cords
A cord is a two or three-conductor cable with a molded plug on one or both
ends. Cords are used to transmit electrical energy to power equipment or
electronic devices. Most of Belden's cords are sold directly to OEMs for
incorporation in portable electric power tools, floor care equipment and
home appliances. Cord products are also marketed through distributors and
appliance wholesalers. Cord sales constituted approximately 12%, 12% and
12% of Belden's sales in 1996, 1995 and 1994, respectively.
Lead, Hook-up and Other Wire Products
Lead and hook-up wire consists of single conductor wire that is used for
electrical leads in motors, internal wiring and test equipment. Belden
sells these products primarily to OEMs that manufacture motors,
transformers, ballasts and lighting, electronic equipment and coil winders.
Belden also markets these products through electrical apparatus parts
distributors, wire specialist distributors and electrical wholesalers. In
Europe, Belden manufactures enamel coated wire used exclusively in the
manufacture of precision deflection coils that are used with computer video
screens and television monitors. These products are sold directly to OEMs.
Belden also fabricates wire for components used in the production of active
and passive electronic components which provide the circuitry connections
for electronic data equipment. Precision tolerances and exacting
specifications allow Belden to play a role in this limited competitive
market. These products are sold directly to the OEM market. Sales of
lead, hook-up and other wire products constituted approximately 13%, 15%
and 11% of Belden's sales in 1996, 1995 and 1994, respectively.
Customers
Belden sells through distributors and directly to OEMs and installers of
equipment and systems. Sales to several business units of Anixter
International Inc. represented approximately 17% of total sales in 1996,
18% in 1995 and 22% in 1994. In general, Belden's distributors are not
contractually obligated to carry the Belden product line exclusively or for
a significant period of time. They could purchase products that compete
with Belden's products in lieu of purchasing products from Belden, and the
loss of one or more large distributors could, at least in the short-term,
have an adverse effect on the Company's results of operations. However,
the Company believes that its relationships with its distributors are
satisfactory and that the distributors choose Belden products due to, among
other reasons, the breadth of Belden's product offering and the quality and
performance characteristics of its products.
International Operations
Belden's international sales consist primarily of multiconductor and
coaxial cable products for computer networking, computer equipment and CATV
and broadcast applications. Belden's primary channels to international
markets are through distributors and direct sales to end users.
Changes in the relative value of currencies take place from time to time
and their effects may be favorable or unfavorable on the Company's results
of operations. Belden sometimes engages in foreign currency hedging
transactions to mitigate these effects. For more information about
- 6 -<PAGE>
<PAGE>
Belden's foreign currency exposure management, See "Note 2: Summary of
Significant Accounting Policies" of Belden's consolidated financial
statements in the 1996 Annual Report, incorporated by reference in Item 8
of this Annual Report on Form 10-K.
Information about Belden's foreign and domestic operations and export sales
are shown in "Note 17: Industry Segments, Major Customers and Geographic
Information" of Belden's consolidated financial statements in the 1996
Annual Report, incorporated by reference in Item 8 of this Annual Report on
Form 10-K.
Competition
Belden faces substantial competition in its major markets. The number and
size of Belden's competitors varies depending on the product line.
However, competition can be generally categorized as highly competitive
with many players, being either global in scope with competitors that have
substantial financial, engineering, manufacturing and marketing resources,
or regional in scope with competitors that have more limited product
offerings with price as the differentiating feature.
The principal competitive factors in all product markets are availability,
customer support, distribution coverage, price and product features. The
relative importance of each of these factors varies depending on the
specific product category.
Some of the Company's competitors have greater financial, engineering,
manufacturing and other resources than the Company. The Company's
competitors can be expected to continue to improve the design and
performance of their products and to introduce new products with
competitive price and performance characteristics. Although the Company
believes that it has certain technological and other advantages over its
competitors, realizing and maintaining such advantages will require
continued investment by the Company in engineering, research and
development, marketing and customer service and support. There can be no
assurance that the Company will continue to make such investments or that
the Company will be successful in maintaining such advantages.
Research and Development
The Company engages in a continuing research and development program,
including new and existing product development, testing and analysis;
process and equipment development and testing; and compound materials
development and testing. For information about the amount spent on
research and development, see "Note 2: Summary of Significant Accounting
Policies" of Belden's consolidated financial statements in the 1996 Annual
Report, incorporated by reference in Item 8 of this Annual Report on Form
10-K.
Patents and Trademarks
The Company has a policy of seeking patents when appropriate on inventions
concerning new products, product improvements and process and equipment
development as part of its ongoing research, development and manufacturing
activities. The Company owns numerous patents and registered trademarks
worldwide, with numerous others for which applications are pending.
Although in the aggregate its patents and trademarks are of considerable
- 7 -<PAGE>
<PAGE>
importance to the manufacturing and marketing of many of its products, the
Company does not consider any single patent or trademark or group of
patents or trademarks to be material to its business as a whole, except for
the Belden (R) trademark. The Company has the right to use the Belden (R)
trademark in connection with all of its current products. The Company,
however, has granted to Cooper the exclusive royalty-free right to use the
Belden (R) trademark for wire and cable products in the automotive markets and
certain other markets in which the Company does not currently compete.
Other important trademarks used by Belden include DataTwist (R), Flamarrest (R),
UnReel (R), Duobond (R), Beldfoil (R), Conformable (R), Pope (R), Alpha (R),
FIT (R) and XTRAGUARD (R) .
Raw Materials
The principal raw material used in many of Belden's products is copper. The
Company has a copper hedging policy that attempts to match the period of
the futures contract with the estimated time required to reflect the change
in copper cost in the sales price of the Company's products. For additional
information, see "Note 2: Summary of Significant Accounting Policies" and
"Note 14: Commitments" of Belden's consolidated financial statements in the
1996 Annual Report, incorporated by reference in Item 8 of this Annual
Report on Form 10-K.
Other raw materials used by Belden include Teflon (R) FEP and other insulating
materials such as plastic and rubber, shielding tape, plywood reels,
corrugated cartons, aluminum and optical fiber. With respect to all major
raw materials used by the Company, Belden generally has either alternative
sources of supply or access to alternative materials. Supplies of these
materials are generally adequate and are expected to remain so for the
foreseeable future. Because of patents owned by others and high capital
requirements, the Company does not currently manufacture its own optical
fibers, but purchases its requirements from others. There is currently a
limited number of manufacturers of optical glass fiber.
Belden sources a minor percentage of its finished products from a network
of manufacturers under private label agreements, and resells these products
under various names, especially Alpha Wire Company.
Backlog
The Company's business is characterized by short-term order and shipment
schedules rather than volume purchase contracts. Accordingly, the Company
does not consider backlog at any given date to be indicative of future
sales. The Company's backlog consists of product orders for which a
customer purchase order has been received or a customer purchase order
number has been communicated and which are scheduled for shipment within
six months. Orders are subject to cancellation or rescheduling by the
customer, generally with a cancellation charge. At December 31, 1996, the
Company's backlog of orders believed to be firm was $50.2 million compared
to $60.2 million at December 31, 1995. The Company believes that all such
backlog will be filled in 1997.
Environmental Matters
The Company is subject to numerous federal, state, local and foreign laws
and regulations relating to the storage, handling, emission and discharge
of materials into the environment, including the Comprehensive
Environmental Response, Compensation, and Liability Act ("CERCLA"), the
- 8 -<PAGE>
<PAGE>
Clean Water Act, the Clean Air Act (including the 1990 amendments) and the
Resource Conservation and Recovery Act. The Company believes that its
existing environmental control procedures are adequate and it has no
current plans for substantial capital expenditures in this area.
A former Belden facility in Shrewsbury, Massachusetts was sold to a third
party in 1992, but Belden has agreed to indemnify the buyer for certain
preexisting environmental liabilities, principally caused by a former
owner. Soil and groundwater contamination has been identified, and the
groundwater contamination extends to the property line in one direction.
Additional investigation as well as soil and groundwater remediation will
be necessary. The Company has recorded a liability for the remaining
costs, which are currently estimated at approximately $700,000.
The Company has been identified as a potentially responsible party ("PRP")
with respect to five sites designated for cleanup under CERCLA or similar
state laws, which impose liability for cleanup of certain waste sites and
for related natural resource damages without regard to fault or the
legality of waste generation or disposal. Persons liable for such costs
and damages generally include the site owner or operator and persons that
disposed or arranged for the disposal of hazardous substances found at
those sites. Although CERCLA imposes joint and several liability on all
PRPs, in application, the PRPs typically allocate the investigation and
cleanup costs based upon the volume of waste contributed by each PRP.
Settlements can often be achieved through negotiations with the appropriate
environmental agency or the other PRPs. PRPs that contributed less than 1%
of the waste are often given the opportunity to settle as "de minimis"
parties, resolving their liability for a particular site. The number of
sites with respect to which the Company has been identified as a PRP has
decreased in part as a result of "de minimis" settlements.
Belden does not own or operate any of the five waste sites with respect to
which it has been identified as a PRP. In each case, Belden is identified
as a party that disposed of waste at the site. With respect to four of the
sites, Belden's share of the waste volume is estimated to be less than 1%.
At the fifth site, Belden contributed less than 10% of the waste. Although
no estimates of cleanup costs have yet been completed for most of these
sites, the Company believes, based on its preliminary review and other
factors, including its estimated share of the waste volume at the sites,
that the costs to the Company relating to these sites will not have a
material adverse effect on its results of operations or financial
condition. The Company has an accrued liability on its balance sheet to
the extent such costs are known and estimable for such sites.
The Company does not currently anticipate any material adverse effect on
its results of operations, financial condition or competitive position as a
result of compliance with federal, state, local or foreign environmental
laws or regulations or cleanup costs of the sites discussed above.
However, some risk of environmental liability and other costs is inherent
in the nature of the Company's business, and there can be no assurance that
material environmental costs will not arise. Moreover, it is possible that
future developments, such as increasingly strict requirements of
environmental laws and enforcement policies thereunder, could lead to
material costs of environmental compliance and cleanup by the Company.
- 9 -<PAGE>
<PAGE>
Employees
As of December 31, 1996, the Company had approximately 4,300 full-time
employees.
Importance of New Products and Product Improvements;
Impact of Technological Change; Impact of Acquisitions
Many of the markets that Belden serves are characterized by advances in
information processing and communications capabilities which require
increased transmission speeds and greater bandwidth. These trends require
ongoing improvements in the capabilities of wire and cable products. The
Company believes that its future success will depend in part upon its
ability to enhance existing products and to develop and manufacture new
products that meet or anticipate such changes. The failure to introduce
successfully new or enhanced products on a timely and cost-competitive
basis could have an adverse impact on the Company's operations and
financial condition.
Fiber optic technology presents a potential substitute for the copper-based
products that comprise the vast majority of Belden's sales. Fiber optic
cables have not to date significantly penetrated the markets served by
Belden due to the high relative cost required to interface electronic and
light signals and the high cost of fiber termination and connection. At
the same time, advances in data transmission equipment and copper cable
technologies have increased the relative performance of copper solutions.
For example, asynchronous transfer mode (ATM) technology using copper cable
may further improve the attractiveness of copper-based solutions. However,
a significant decrease in the cost of fiber optic systems could make such
systems superior on a price/performance basis to copper systems. While the
Company has been a fiber optic cable supplier in niche, specialty markets
since 1976, such a significant decrease in the cost of fiber optic systems
would likely have an adverse effect on the Company.
Wireless communications technology may represent a threat to both copper
and fiber optic-based systems by reducing the need for premise wiring.
Belden believes that the eliminated signal security and the relatively slow
transmission speeds of current systems restrict the use of wireless systems
in many data communications markets. However, there are no assurances that
future advances in wireless technology may not have an adverse effect on
the Company's business.
The Company also does not presently anticipate that the commercialization
of video delivery technology -- direct broadcast technology ("DBS") -- will
have a material adverse effect on its CATV drop cable business. With DBS,
a small satellite dish antenna is placed on the roof of a subscriber's
facility. DBS does not require wiring from a central location to each
subscriber, as does a CATV system. The Company has cables that meet the
requirements of a DBS system, specifically the cable that connects the DBS
satellite dish antenna with a subscriber's home or business television set.
The recently enacted telecommunications legislation presents uncertainties
and opportunities in the CATV area. This pending legislation and
uncertainties regarding telecommunication network architectures resulted in
a delay in spending by CATV product end users during 1996.
- 10 -<PAGE>
<PAGE>
Continued strategic acquisitions are an announced part of Belden's future
strategy, and as discussed in the Notes to the financial statements in the
1996 Annual Report (incorporated by reference in Item 8 of this Annual
Report on Form 10-K), the Company has completed four acquisitions in the
past two years. However, there can be no assurance that future
acquisitions will occur or that those that do occur will be successful.
Executive Officers
The following sets forth certain information with respect to Belden's
executive officers as of December 31, 1996. All executive officers are
elected to terms which expire at the organizational meeting of the Board of
Directors following the Annual Meeting of Shareholders.
<TABLE>
<CAPTION>
Name Age Position
<S> <C> <C>
C. Baker Cunningham 55 Chairman of the Board, President, Chief
Executive Officer and Director
Richard K. Reece 40 Vice President, Finance, Treasurer and Chief
Financial Officer
Peter J. Wickman 47 Vice President, Operations
Kevin L. Bloomfield 45 Vice President, Secretary and General Counsel
Larry E. Fast 49 Vice President and General Manager, Cord
Products Division of Belden Wire & Cable Company
</TABLE>
C. Baker Cunningham has been Chairman, President and Chief Executive
Officer of the Company since 1993. From February 1982 until July 1993, he
was an Executive Vice President, Operations of Cooper, a manufacturer of
electrical equipment, tools and hardware, and automotive products. Mr.
Cunningham has a B.S. degree in civil engineering from Washington
University, an M.S. degree in civil engineering from Georgia Tech and an
M.B.A. from the Harvard Business School.
Richard K. Reece has been Vice President, Finance, Treasurer and Chief
Financial Officer of the Company since August 1, 1993. He was associated
with the public accounting firm of Ernst & Young, LLP from 1978 until June
1993 and was a partner with that firm since 1989. He has a B.S. degree in
accounting from Auburn University and is a Certified Public Accountant.
Peter J. Wickman has been Vice President, Operations of the Company since
1993. He was Vice President, Finance and Planning for the Belden Division
of Cooper from 1989 to July 1993. He was Controller of Cooper's Bussmann
Division from 1983 to 1989. Mr. Wickman has a B.S. degree in accounting
from Walton School of Commerce and is a Certified Public Accountant.
Kevin L. Bloomfield has been Vice President, Secretary and General Counsel
of the Company since August 1, 1993. He was Senior Counsel for Cooper from
February 1987 to July 1993, and had been in Cooper's Law Department from
1981 to 1993. He has a B.A. degree in economics and a J.D. degree from the
University of Cincinnati and an M.B.A. from Ohio State University.
Larry E. Fast joined Belden in 1972. From 1983 to 1992, he was Director of
- 11 -<PAGE>
<PAGE>
Manufacturing. From 1992 until February 1994, he was Vice President,
Manufacturing. On March 1, 1994, he became Vice President and General
Manager, Cord Products Division of Belden Wire & Cable Company, a
subsidiary of Belden Inc. He has a B.S. degree from Indiana University and
has completed Harvard Business School's Program for Management Development.
He is not an executive officer of the Company. However, in 1994, he began
performing a policy-making function for the Company as Vice President and
General Manager, Cord Products Division of Belden Wire & Cable Company.
- 12 - <PAGE>
<PAGE>
Item 2. Properties
Belden has an executive office and various manufacturing plants,
distribution centers and sales offices. The significant facilities are as
follows:
<TABLE>
<CAPTION>
Owned
Square or
Location Facility Type Feet Leased
<S> <C> <C> <C>
St. Louis, Missouri Executive Office 7,466 Leased
Richmond, Indiana Sales and Administrative Office 53,575 Owned
Carmel, Indiana Sales and Administrative Office 11,077 Leased
Richmond, Indiana Engineering Center 70,000 Owned
Richmond, Indiana Manufacturing-electronics wire & 693,372 Owned
cable
Richmond, Indiana Distribution Center 145,000 Owned
Clinton, Arkansas Manufacturing-electrical cords 133,000 Owned
Monticello, Kentucky Manufacturing-electronics wire & 222,800 Owned
cable
Tompkinsville, Kentucky Manufacturing-electronics wire & 228,800 Owned
cable, flat cable & fiber optics
Hudson, Massachusetts Manufacturing-electronics wire & 215,000 Leased
cable
Elizabeth, New Jersey Sales and Administrative Office 7,064 Owned
Elizabeth, New Jersey Distribution Center 197,250 Owned
Charlotte, North Carolina Manufacturing-electronics wire & 96,000 Leased
cable
Franklin, North Carolina Manufacturing-electrical cords 101,800 Owned
Apple Creek, Ohio Manufacturing-electrical cords 40,200 Owned
Essex Junction, Vermont Manufacturing-high temperature 77,400 Owned
electronics wire & cable
Cobourg, Ontario, Canada Manufacturing-electrical & 215,000 Owned
electronics wire & cable; Sales
Office and Distribution Center
Neuss, Germany Sales Office 37,600 Leased
Venlo, The Netherlands Manufacturing-electronics wire & 585,000 Owned
cable; Warehouse; and Sales and
Administrative Office
Hermosillo, Mexico Manufacturing-electrical cords and 65,000 Leased
Warehouse
Nogales, Arizona Distribution Center 10,000 Leased
</TABLE>
- 13 - <PAGE>
<PAGE>
The Company believes its physical facilities are suitable for their present
and intended purposes and adequate for the Company's current level of
operations.
Item 3. Legal Proceedings
The Furon Company has filed a lawsuit against BWC, claiming that it is
infringing a Furon patent. The Company intends to vigorously defend its
position and believes that the lawsuit should not have a material adverse
effect on the Company.
The Company is also a party to various legal proceedings and administrative
actions which are incidental to the operations of the Company. In the
opinion of the Company's management, such proceedings and actions should
not, individually or in the aggregate, have a material adverse effect on
the Company's results of operations or financial condition.
See "Item 1. Business-Environmental Matters" regarding certain
proceedings arising under environmental laws.
Item 4. Submission of Matters to a Vote of Security Holders
During the fourth quarter of the fiscal year covered by this report, no
matters were submitted to a vote of security holders of the Company.
PART II
Item 5. Market for Registrant's Common Equity and Related Shareholder
Matters
At February 28,1997, there were 970 record holders of Common Stock of
Belden Inc.
The additional information required by Item 5 is incorporated herein by
reference to page 51 of the 1996 Annual Report. The Company anticipates
that comparable cash dividends will continue to be paid in the foreseeable
future.
Item 6. Selected Financial Data
Incorporated herein by reference to page 25 of the 1996 Annual Report.
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Incorporated herein by reference to pages 26 through 32 of the 1996 Annual
Report.
Item 8. Financial Statements and Supplementary Data
Incorporated herein by reference to pages 34 through 50 of the 1996 Annual
Report.
- 14 -<PAGE>
<PAGE>
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
None.
PART III
Item 10. Directors and Executive Officers of the Registrant
Information regarding directors is incorporated herein by reference to
"Matters to Come Before the Meeting," pages 2 through 4 of the Proxy
Statement. Information regarding executive officers is set forth in Part I
at pages 11-12 herein under the heading "Executive Officers."
Item 11. Executive Compensation
Incorporated herein by reference to "Compensation of Directors", "Executive
Compensation" and "Stock Price Performance Graph", pages 10 through 18 of
the Proxy Statement.
Item 12. Security Ownership of Certain Beneficial Owners and Management
Incorporated herein by reference to "Stock Ownership of Management and
Certain Beneficial Owners," pages 9-10 of the Proxy Statement.
Item 13. Certain Relationships and Related Transactions
Incorporated herein by reference to "Other Matters", page 18 of the Proxy
Statement.
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K
(a) 1. Financial Statements (located on the pages in the 1996
Annual Report shown below).
Page No.
1996 Annual Report
Report of Independent Auditors . . . . . . . . . . 33
Consolidated Balance Sheets as of
December 31, 1996 and December 31, 1995 . . . . . 34
Consolidated Income Statements for Each of
the Three Years in the Period Ended
December 31, 1996 . . . . . . . . . . . . . . . . 35
Consolidated Cash Flow Statements for Each
of the Three Years in the Period Ended
December 31, 1996 . . . . . . . . . . . . . . . . 36
Consolidated Stockholders' Equity Statements
for Each of the Three Years in the Period
Ended December 31, 1996 . . . . . . . . . . . . . 37
Notes to Consolidated Financial Statements . . .38-50
- 15 -<PAGE>
<PAGE>
With the exception of the financial statements and other financial data and
other information listed above or incorporated by reference under other
Items of this Annual Report on Form 10-K, the 1996 Annual Report is not
filed as part of this Annual Report. Financial statement schedules not
included in this Annual Report on Form 10-K have been omitted because they
are not applicable or the required information is shown in the financial
statements or notes thereto.
3. Exhibits. The following exhibits are filed herewith or
incorporated herein by reference. Documents indicated by an asterisk (*)
are filed herewith; documents indicated by a double asterisk identify each
management contract or compensatory plan. Documents not indicated by an
asterisk are incorporated herein by reference to the document indicated.
References to (i) the "Registration Statement" are to the Belden Inc.
Registration Statement on Form S-1, File Number 33-66830, (ii) the "Form
10-Q" are to the Belden Inc. Quarterly Report on Form 10-Q for the Quarter
ended September 30, 1993, File Number 1-12280, (iii) the "Form 10-Q, Second
Quarter, 1994" are to the Belden Inc. Quarterly Report on Form 10-Q for the
Quarter ended June 30, 1994, File Number 1-12280, (iv) the "Form 8-K" are
to the Belden Inc. Report on Form 8-K, filed with the Commission on April
17, 1995, File Number 1-12280, (v) the "Form 8-A" are to the Belden Inc.
Registration Statement on Form 8-A filed with the Commission and effective
on July 25, 1995, (vi) the "Amendment to Form S-8" are to the Belden Inc.
Post-Effective Amendment No. 1 of Form S-8 Registration Statement, filed
with the Commission on October 23, 1995, File Number 33-66830, (vii) the
"Form 10-K" are to the Belden Inc. Report on Form 10-K for 1995, File
Number 1-12280, (viii)the "Form 10-Q, Third Quarter, 1996" are to the
Belden Inc. Quarterly Report on Form 10-Q for the Quarter ended September
30, 1996, File Number 1-12280, (ix) the "Form S-8" are to the Belden Inc.
Registration Statement on Form S-8, filed in connection with the Belden
Inc. Non-Employee Director Stock Plan, File Number 333-11071, and (x) the
"Form 8-K, January 1997" are to the Belden Inc. Report on Form 8-K, filed
with the Commission on January 23, 1997, File Number 1-12280.
Exhibit No. Description
2.1 Stock Purchase Agreement, dated April 3, 1995, among PCW
Beheermaatschappij B.V., Philips Electronics N.V., Belden Inc. and
Belden Europe B.V. for the purchase of Pope Cable and Wire B.V.
(Exhibit 2 to Form 8-K)
2.2 Asset Purchase Agreement, dated October 21, 1996, between Belden
Wire & Cable Company and Intech Cable, Inc. (Exhibit 10.1 to Form
10-Q, Third Quarter, 1996)
2.3 Asset Purchase Agreement, dated November 21, 1996, between Belden
Wire & Cable Company and Alpha Wire Corporation, and Asset Purchase
Agreement/U.K. Assets dated January 7, 1997 between Belden U.K.
Limited and Alpha Wire Limited (Exhibits 2.1 and 2.2 to Form 8-K,
January 1997)
3.1 Certificate of Incorporation of the Company (Exhibit 3.1 to
Registration Statement)
3.2 Bylaws of the Company (Exhibit 3.2 to Registration Statement)
4.1 Specimen Common Stock Certificate (Exhibit 4.1 to Form 10-K)
* 4.2 Amendment to Specimen Common Stock Certificate
4.3 Rights Agreement, dated as of July 6, 1995, between Belden Inc. and
First Chicago Trust Company of New York, as Rights Agent; Boatmen's
Trust Company has superseded First Chicago Trust Company of New
York as Rights Agent (Exhibit 1 to Form 8-A)
- 16 - <PAGE>
<PAGE>
10.1 Asset Transfer Agreement by and between Cooper Industries, Inc. and
Belden Wire & Cable Company, with schedules and exhibits thereto
(Exhibit 10.1 to Form 10-Q)
10.2 Canadian Asset Transfer Agreement by and between Cooper Industries
(Canada) Inc. and Belden (Canada) Inc. (Exhibit 10.11 to Form 10-Q)
10.3 Trademark License Agreement by and between Belden Wire & Cable
Company and Cooper Industries, Inc. (Exhibit 10.2 to Form 10-Q)
10.4 Stock Agreement by and between Cooper Industries, Inc. and Belden
Inc. (Exhibit 10.4 to Form 10-Q)
10.5 Tax Sharing and Separation Agreement by and among Belden Inc.,
Cooper Industries, Inc., and Belden Wire & Cable Company (Exhibit
10.6 to Form 10-Q)
** 10.6 Non-Employee Director Stock Plan (Exhibit 4.5 to Form S-8)
** 10.7 Change of Control Agreements, dated as of August 16, 1996, between
Belden Inc. and each of C. Baker Cunningham, Richard K. Reece,
Peter J. Wickman, Kevin L. Bloomfield and Larry E. Fast (Exhibit
10.3 to Form 10-Q, Third Quarter, 1996)
** 10.8 Trust Agreement ("Rabbi Trust"), dated June 3, 1996, between Belden
Wire & Cable Company and Boatmen's Trust Company (Exhibit 10.4 to
Form 10-Q, Third Quarter, 1996)
** 10.9 Belden Inc. Long-Term Incentive Plan (Exhibit 10.2 to Form 10-Q,
Second Quarter, 1994)
**10.10 Belden Inc. Employee Stock Purchase Plan, as restated as of August
4, 1995 (Exhibit 99.1 to Amendment to Form S-8)
**10.11 Belden Wire & Cable Company Supplemental Excess Defined Benefit
Plan (Exhibit 10.11 to Registration Statement)
**10.12 Belden Wire & Cable Company Supplemental Excess Defined
Contribution Plan (Exhibit 10.15 to Registration Statement)
**10.13 Indemnification Agreements entered into between Belden Inc. and
each of its directors and executive officers (Exhibit 10.10 to Form
10-Q)
* 10.14 Credit Agreement, dated as of November 18, 1996, among Belden Wire
& Cable Company, Bank of America National Trust and Savings
Association, NationsBank, N.A., Royal Bank of Canada, Wachovia Bank
of Georgia, N.A., The Boatmen's National Bank of St. Louis, ABN
AMRO Bank N.V., The Northern Trust Company and Commerzbank
Aktiengesellschaft, Grand Cayman Branch
* 10.15 Guaranty of Belden Inc., the form of which is included as Exhibit D
to the Credit Agreement listed above as Exhibit 10.14
* 13.1 Belden Inc. 1996 Annual Report to Shareholders (to the extent
incorporated herein by reference)
* 21.1 List of Subsidiaries of Belden Inc.
* 23.1 Consent of Ernst & Young LLP
* 24.1 Powers of Attorney from Members of the Board of Directors of Belden
Inc.
* 27.1 Financial Data Schedule
* 99.1 Proxy Statement for the Annual Meeting of Stockholders to be held
on May 1, 1997
Copies of the above Exhibits are available to shareholders at a charge of
$.25 per page, minimum order of $10.00. Direct requests to:
Belden Inc.
Attention: Secretary
7701 Forsyth Boulevard, Suite 800
St. Louis, Missouri 63105
- 17 - <PAGE>
<PAGE>
(b) Reports on Form 8-K. No reports on Form 8-K were filed during
the last quarter of 1996.
Signatures
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
BELDEN INC.
By: /s/ C. Baker Cunningham
C. Baker Cunningham
Chairman of the Board, President,
Chief Executive Officer
Date: March 14, 1997 and Director
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the date indicated.
/s/ C. Baker Cunningham President, Chairman of the Board March 14, 1997
C. Baker Cunningham Chief Executive Officer and
Director
/s/ Richard K. Reece Vice President, Finance, March 14, 1997
Richard K. Reece Treasurer and Chief Financial
Officer
(Mr. Reece also is the Company's
Chief Accounting Officer)
/s/ Lorne D. Bain* Director March 14, 1997
Lorne D. Bain
/s/ Joseph R. Coppola* Director March 14, 1997
Joseph R. Coppola
/s/ Alan E. Riedel* Director March 14, 1997
Alan E. Riedel
/s/ Bernard G. Rethore* Director March 14, 1997
Bernard G. Rethore
/s/Christopher I. Byrnes* Director March 14, 1997
Christopher I. Byrnes
/s/ C. Baker Cunningham
*By C. Baker Cunningham, Attorney-in-fact
- 18 -<PAGE>
<PAGE>
Index to Exhibits
<TABLE>
<CAPTION>
Sequentially
Exhibit Numbered
Number Pages
<S> <C> <C>
2.1 Stock Purchase Agreement, dated April 3, 1995, among PCW Beheermaatschappij B.V.,
Philips Electronics N.V., Belden Inc. and Belden Europe B.V. for the purchase of Pope
Cable and Wire B.V. (Exhibit 2 to Form 8-K)
2.2 Asset Purchase Agreement, dated October 21, 1996, between Belden Wire & Cable Company
and Intech Cable, Inc. (Exhibit 10.1 to Form 10-Q, Third Quarter, 1996)
2.3 Asset Purchase Agreement, dated November 21, 1996, between Belden Wire & Cable Company
and Alpha Wire Corporation, and Asset Purchase Agreement/U.K. Assets dated January 7,
1997 between Belden U.K. Limited and Alpha Wire Limited (Exhibits 2.1 and 2.2 to Form
8-K, January 1997)
3.1 Certificate of Incorporation of the Company (Exhibit 3.1 to Registration Statement)
3.2 Bylaws of the Company (Exhibit 3.2 to Registration Statement)
4.1 Specimen Common Stock Certificate (Exhibit 4.1 to Form 10-K)
*4.2 Amendment to Specimen Common Stock Certificate
4.3 Rights Agreement, dated as of July 6, 1995, between Belden Inc. and First Chicago
Trust Company of New York, as Rights Agent; Boatmen's Trust Company has superseded
First Chicago Trust Company of New York as Rights Agent (Exhibit 1 to Form 8-A)
10.1 Asset Transfer Agreement by and between Cooper Industries, Inc. and Belden Wire &
Cable Company, with schedules and exhibits thereto (Exhibit 10.1 to Form 10-Q)
10.2 Canadian Asset Transfer Agreement by and between Cooper Industries (Canada) Inc. and
Belden (Canada) Inc. (Exhibit 10.11 to Form 10-Q)
10.3 Trademark License Agreement by and between Belden Wire & Cable Company and Cooper
Industries, Inc. (Exhibit 10.2 to Form 10-Q)
10.4 Stock Agreement by and between Cooper Industries, Inc. and Belden Inc. (Exhibit 10.4
to Form 10-Q)
10.5 Tax Sharing and Separation Agreement by and among Belden Inc., Cooper Industries,
Inc., and Belden Wire & Cable Company (Exhibit 10.6 to Form 10-Q)
**10.6 Non-Employee Director Stock Plan (Exhibit 4.5 to Form S-8)
**10.7 Change of Control Agreements, dated as of August 16, 1996, between Belden Inc. and
each of C. Baker Cunningham, Richard K. Reece, Peter J. Wickman, Kevin L. Bloomfield
and Larry E. Fast (Exhibit 10.3 to Form 10-Q, Third Quarter, 1996)
**10.8 Trust Agreement ("Rabbi Trust"), dated June 3, 1996, between Belden Wire & Cable
Company and Boatmen's Trust Company (Exhibit 10.4 to Form 10-Q, Third Quarter, 1996)
**10.9 Belden Inc. Long-Term Incentive Plan (Exhibit 10.2 to Form 10-Q, Second Quarter, 1994)
-19-<PAGE>
<PAGE>
**10.10 Belden Inc. Employee Stock Purchase Plan, as restated as of August 4, 1995 (Exhibit
99.1 to Amendment to Form S-8)
**10.11 Belden Wire & Cable Company Supplemental Excess Defined Benefit Plan (Exhibit 10.11 to
Registration Statement)
**10.12 Belden Wire & Cable Company Supplemental Excess Defined Contribution Plan (Exhibit
10.15 to Registration Statement)
**10.13 Indemnification Agreements entered into between Belden Inc. and each of its directors
and executive officers (Exhibit 10.10 to Form 10-Q)
*10.14 Credit Agreement, dated as of November 18, 1996, among Belden Wire & Cable Company,
Bank of America National Trust and Savings Association, NationsBank, N.A., Royal Bank
of Canada, Wachovia Bank of Georgia, N.A., The Boatmen's National Bank of St. Louis,
ABN AMRO Bank N.V., The Northern Trust Company and Commerzbank Aktiengesellschaft,
Grand Cayman Branch
*10.15 Guaranty of Belden Inc., the form of which is included as Exhibit D to the Credit
Agreement listed above as Exhibit 10.14
*13.1 Belden Inc. 1996 Annual Report to Shareholders (to the extent incorporated herein by
reference)
*21.1 List of Subsidiaries of Belden Inc.
*23.1 Consent of Ernst & Young LLP
*24.1 Powers of Attorney from Members of the Board of Directors of Belden Inc.
*27.1 Financial Data Schedule
*99.1 Proxy Statement for the Annual Meeting of Stockholders to be held on May 1, 1997
</TABLE>
*Filed herewith. Documents not indicated by an asterisk (*) are
incorporated herein by reference.
-20-<PAGE>
<PAGE>
Exhibit 4.2
Amendment to Specimen Common Stock Certificate
The Specimen Common Stock Certificate has been amended by adding a sentence at
the end of the first paragraph on the reverse side thereof, as indicated below:
[first paragraph on reverse side of amended Specimen Stock Certificate:]
This certificate also evidences and entitles the holder hereof to
certain Rights as set forth in the Rights Agreement, dated as of July 6,
1995 (the "Rights Agreement), between Belden Inc. and First Chicago Trust
Company of New York as Rights Agent, the terms of which are hereby
incorporated herein by reference and a copy of which is on file at the
principal offices of Belden Inc. Under certain circumstances, as set forth
in the Rights Agreement, such Rights will be evidenced by separate
certificates and will no longer be evidenced by this certificate. Belden
Inc. will mail to the holder of this certificate a copy of the Rights
Agreement, as in effect on the date of mailing, without charge promptly
after receipt of a written request therefor. Under certain circumstances
set forth in the Rights Agreement, Rights issued to, or held by, any Person
who is, was or becomes an Acquiring Person or any Affiliate or Associate
thereof (as such terms are defined in the Rights Agreement), whether
currently held by or on behalf of such Person or by any subsequent holder,
may become null and void. *[Boatmen's Trust Company has superseded First
Chicago Trust Company of New York as Rights Agent.]
* [] Denotes added sentence<PAGE>
<PAGE>
U.S. $200,000,000
CREDIT AGREEMENT
Dated as of November 18, 1996
Among
BELDEN WIRE & CABLE COMPANY
as Borrower,
THE BANKS NAMED HEREIN
as Banks,
and
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION
as Administrative Agent<PAGE>
<PAGE>
TABLE OF CONTENTS
ARTICLE 1.
DEFINITIONS AND ACCOUNTING TERMS
Section 1.1 Certain Defined Terms . . . . . . . . . . . . . . . . . . . 1
Section 1.2 Computation of Time Periods . . . . . . . . . . . . . . . . 10
Section 1.3 Accounting Terms. . . . . . . . . . . . . . . . . . . . . . 11
Section 1.4 Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . 11
ARTICLE 2.
CREDIT FACILITY
Section 2.1 The A Advances . . . . . . . . . . . . . . . . . . . . . . 11
Section 2.2 The B Advances . . . . . . . . . . . . . . . . . . . . . . 14
Section 2.3 Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 2.4 Interest . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 2.5 Payments, Etc . . . . . . . . . . . . . . . . . . . . . . . 21
Section 2.6 Payments Pro Rata . . . . . . . . . . . . . . . . . . . . . 23
Section 2.7 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 2.8 Breakage Costs . . . . . . . . . . . . . . . . . . . . . . 24
Section 2.9 Increased Costs . . . . . . . . . . . . . . . . . . . . . . 24
Section 2.10 Capital Adequacy . . . . . . . . . . . . . . . . . . . . . 25
Section 2.11 Certain Tax Regulations . . . . . . . . . . . . . . . . . 26
Section 2.12 Illegality . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 2.13 Market Failure . . . . . . . . . . . . . . . . . . . . . . 27
Section 2.14 Removal of Certain Banks . . . . . . . . . . . . . . . . . 27
ARTICLE 3.
CONDITIONS
Section 3.1 Conditions to First Advances . . . . . . . . . . . . . . . 28
Section 3.2 A Borrowings . . . . . . . . . . . . . . . . . . . . . . . 29
Section 3.3 B Borrowings . . . . . . . . . . . . . . . . . . . . . . . 29
ARTICLE 4.
REPRESENTATIONS AND WARRANTIES
Section 4.1 Corporate Existence and Power . . . . . . . . . . . . . . . 30
Section 4.2 Corporate Authority . . . . . . . . . . . . . . . . . . . . 30
Section 4.3 Financial Condition . . . . . . . . . . . . . . . . . . . . 31
Section 4.4 Litigation. . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 4.5 Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 4.6 Use of Advances.. . . . . . . . . . . . . . . . . . . . . . 31
Section 4.7 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 4.8 Subsidiaries. . . . . . . . . . . . . . . . . . . . . . . . 32
Section 4.9 Credit Agreement . . . . . . . . . . . . . . . . . . . . . 32
Section 4.10 Titles, Etc. . . . . . . . . . . . . . . . . . . . . . . . 32
Section 4.11 ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 4.12 Validity, Etc. . . . . . . . . . . . . . . . . . . . . . . 32
Section 4.13 Environmental Matters. . . . . . . . . . . . . . . . . . . 32<PAGE>
<PAGE>
ARTICLE 5.
COVENANTS
Section 5.1 Financial Statements . . . . . . . . . . . . . . . . . . . 33
Section 5.2 Leverage Ratio . . . . . . . . . . . . . . . . . . . . . . 35
Section 5.3 Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 5.4 Merger and Sale of Assets . . . . . . . . . . . . . . . . . 36
Section 5.5 Subsidiary Guaranties . . . . . . . . . . . . . . . . . . . 37
Section 5.6 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 5.7 Sale-and-Leaseback . . . . . . . . . . . . . . . . . . . . 37
Section 5.8 Net Worth . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 5.9 Maintenance of Property; Insurance . . . . . . . . . . . . 38
Section 5.10 Compliance with Laws . . . . . . . . . . . . . . . . . . . 38
ARTICLE 6.
EVENTS OF DEFAULT
ARTICLE 7.
THE AGENT
Section 7.1 Authorization and Action . . . . . . . . . . . . . . . . . 41
Section 7.2 Agent's Reliance, Etc . . . . . . . . . . . . . . . . . . . 41
Section 7.3 The Agent and Affiliates . . . . . . . . . . . . . . . . . 42
Section 7.4 Bank Credit Decision . . . . . . . . . . . . . . . . . . . 42
Section 7.5 Indemnification . . . . . . . . . . . . . . . . . . . . . . 43
Section 7.6 Successor Agent . . . . . . . . . . . . . . . . . . . . . . 43
ARTICLE 8.
MISCELLANEOUS
Section 8.1 Amendments, Etc . . . . . . . . . . . . . . . . . . . . . . 44
Section 8.2 Notices, Etc . . . . . . . . . . . . . . . . . . . . . . . 45
Section 8.3 No Waiver; Remedies . . . . . . . . . . . . . . . . . . . . 45
Section 8.4 Costs, Expenses, and Taxes . . . . . . . . . . . . . . . . 45
Section 8.5 Right of Set-off . . . . . . . . . . . . . . . . . . . . . 46
Section 8.6 Assignments and Participations . . . . . . . . . . . . . . 46
Section 8.7 Governing Law . . . . . . . . . . . . . . . . . . . . . . . 49
Section 8.8 Execution in Counterparts . . . . . . . . . . . . . . . . . 49
Section 8.9 Survival of Agreements . . . . . . . . . . . . . . . . . . 49
Section 8.10 Borrower's Right to Apply Deposits . . . . . . . . . . . . 49
Section 8.11 Binding Effect . . . . . . . . . . . . . . . . . . . . . . 50
Section 8.12 WAIVER OF JURY TRIAL . . . . . . . . . . . . . . . . . . . 50
Section 8.13 ENTIRE AGREEMENT . . . . . . . . . . . . . . . . . . . . . 50
Document #0021220 ii<PAGE>
<PAGE>
EXHIBITS
Exhibit A-1 Form of A Promissory Note
Exhibit A-2 Form of B Promissory Note
Exhibit B-1 Form of Request for A Borrowing
Exhibit B-2 Form of Request for B Borrowing
Exhibit B-3 Form of Offer of B Advances
Exhibit B-4 Form of Acceptance of B Advances
Exhibit C Form of Compliance Certificate
Exhibit D Form of Guaranty
Exhibit E Form of Assignment and Acceptance
SCHEDULES
Schedule I Borrower, Agent and Bank Information
Schedule II Borrower's List of Subsidiaries
Schedule III Borrower Disclosures
Document #0021220 iii<PAGE>
<PAGE>
CREDIT AGREEMENT
This Credit Agreement dated as of November 18, 1996, is by and among the
Borrower, the Agent, and the Banks. In consideration of the mutual
covenants and agreements contained herein, the Borrower, the Agent, and the
Banks hereby agree as follows:
ARTICLE 1.
DEFINITIONS AND ACCOUNTING TERMS
Section 1.1 Certain Defined Terms. As used in this Agreement, the following
terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
"A Advance" means an advance by a Bank to the Borrower as part of an A
Borrowing and refers to a Base Rate Advance or a LIBOR Rate Advance, each
of which shall be a "Type" of A Advance.
"A Borrowing" means a borrowing consisting of simultaneous A Advances of
the same Type to the Borrower made by each of the Banks pursuant to Section
2.1.
"A Note" means a promissory note of the Borrower payable to the order of
any Bank, in substantially the form of Exhibit A-1, evidencing the
aggregate indebtedness of the Borrower to such Bank resulting from A
Advances.
"Acceptance of B Advances" means an Acceptance of B Advances in the form of
Exhibit B-4, fully completed with the required information and executed by
the Borrower.
"Advance" means an A Advance or a B Advance.
"Affiliate" means, with respect to any Person, either a wholly-owned
subsidiary of such Person or a wholly-owned subsidiary of any corporation
controlling such Person.
"Agent" means Bank of America National Trust and Savings Association, in
its capacity as agent pursuant to Article 7 hereof or any successor Agent
pursuant to Section 7.6.
"Agent's Fee Letter" means the letter agreement dated as of October 18,
1996, between the Agent and the Borrower.
"Agreement" means this Credit Agreement dated as of November 18, 1996,
among the Borrower, the Agent, and the Banks.
"Alternate Currency" means Pounds Sterling, German Marks, French Francs,
Italian Lira, Dutch Guilders, Japanese Yen, Canadian Dollars, Swiss Francs,
Australian Dollars and any other currency (other than Dollars) approved by
the Banks which is freely transferable and convertible into Dollars and in
which dealings in deposits are carried out on the London interbank market.
Document #0021220<PAGE>
<PAGE>
"Alternate Currency A Advance" means an A Advance made in an Alternate
Currency.
"Alternate Currency B Advance" means a B Advance made in an Alternate
Currency.
"Alternate Currency Advance" means an Alternate Currency A Advance or an
Alternate Currency B Advance.
"Alternate Lending Office" means, with respect to any Bank, the office of
such Bank specified as its "Alternate Lending Office" opposite its name on
Schedule I hereto or if no such office is specified, its Domestic Lending
Office (or with respect to any assignee becoming a Bank hereunder in
accordance with Section 8.6(e), as set forth in the applicable Assignment),
or such other office of such Bank as such Bank may from time to time
specify to the Borrower and the Agent.
"Applicable Currency" means, as to any particular payment or Advance,
Dollars or the Alternate Currency in which it is denominated or is payable.
"Applicable Facility Fee" means, with respect to the Facility Fee paid by
the Borrower to the Banks under Section 2.3(a) and for any period during
which such Applicable Facility Fee shall be in effect, the percentage
amount set forth in the appropriate column in the definition of "Applicable
Interest Margin". The Agent shall determine the Applicable Facility Fee
based upon the most recent quarterly or year-end financial statements
delivered to the Agent pursuant to Sections 5.1(a) and (b). Any
adjustments to the Applicable Facility Fee shall become effective three
Business Days following the date of delivery of such financial statements
to the Agent or, if the financial information required for such
determination is according to regular practice made public prior to such
date, three Business Days after the date such financial information is made
public. Upon any change in the Applicable Facility Fee, the Agent shall
promptly notify the Borrower and the Banks of the new Applicable Facility
Fee.
"Applicable Interest Margin" means, with respect to any A Advance which is
a LIBOR Rate Advance and for any period during which such Applicable
Interest Margin shall be in effect, the percentage amount set forth in the
appropriate column in the table below, relating to the applicable Leverage
Ratio. The Agent shall determine the Applicable Interest Margin based upon
the most recent quarterly or year-end financial statements delivered to the
Agent pursuant to Sections 5.1(a) and (b). Any adjustments to the
Applicable Interest Margin shall become effective three Business Days
following the date of delivery of such financial statements to the Agent
or, if the financial information required for such determination is
according to regular practice made public prior to such date, three
Business Days after the date such financial information is made public.
Upon any change in the Applicable Interest Margin, the Agent shall promptly
notify the Borrower and the Banks of the new Applicable Interest Margin.
Document #0021220 2 <PAGE>
<PAGE>
<TABLE>
<CAPTION>
Level I Level II Level III Level IV Level V
<S> <C> <C> <C> <C> <C>
Leverage Ratio Less than 40% Equal to or Equal to or Equal to or Equal to or
greater than 40% greater than 45% greater than 55% greater than 60%
but less than but less than but less than 60%
45% 55%
Applicable Facility 9.0 10.0 12.5 17.5 25.0
Fee: (in basis points)
Applicable Interest Margin: 23.5 25.0 27.5 32.5 50.0
(in basis points)
</TABLE>
For example, if the Leverage Ratio is less than 40%, the Applicable
Facility Fee is 9/100 of one percent.
"Applicable Lending Office" means, with respect to each Bank, such Bank's
Domestic Lending Office in the case of a Base Rate Advance, such Bank's
Alternate Lending Office in the case of a LIBOR Rate Advance, and, in the
case of a B Advance, the office of such Bank notified by such Bank to the
Agent as its Applicable Lending Office with respect to such B Advance.
"Assignment" means an assignment and acceptance in substantially the form
of Exhibit E executed by an assignor Bank and an assignee Bank in
accordance with Section 8.6(d).
"Attorney Costs" means and includes all reasonable fees and disbursements
of any law firm or other external counsel, the reasonable allocated cost of
internal legal services and all disbursements of internal counsel.
"B Advance" means an advance by a Bank to the Borrower as part of a B
Borrowing resulting from the bidding procedure described in Section 2.2.
"B Borrowing" means a borrowing consisting of simultaneous B Advances to
the Borrower from each of the Banks whose offer to make one or more B
Advances as part of such borrowing has been accepted by the Borrower under
the bidding procedure described in Section 2.2.
"B Note" means a promissory note of the Borrower payable to the order of
any Bank, in substantially the form of Exhibit A-2, evidencing the
indebtedness of the Borrower to such Bank resulting from a B Advance made
to the Borrower by such Bank.
"Banks" means the banks listed on the signature pages hereof and each other
Person that becomes a Bank in accordance with Section 8.6(e).
"Base Rate" means a fluctuating interest rate per annum as shall be in
effect from time to time which rate per annum shall at all times be equal
to the highest of (a) the Reference Rate or (b) 0.500% per annum above the
Federal Funds Rate in effect from time to time.
"Base Rate Advance" means an A Advance which bears interest as provided in
Section 2.4(a)(i).
Document #0021220 3<PAGE>
<PAGE>
"Belden" means Belden Inc., a Delaware corporation, or Belden Wire & Cable
Company following any merger of Belden Inc. into Belden Wire & Cable
Company pursuant to Section 5.4(a).
"Borrower" means Belden Wire & Cable Company, a Delaware corporation, or
Belden Inc., a Delaware corporation, following any merger of Belden Wire &
Cable Company into Belden Inc. pursuant to Section 5.4(a).
"Borrowing" means an A Borrowing or a B Borrowing.
"Business Day" means a day of the year on which commercial banks are not
required or authorized to close in Chicago, Illinois, San Francisco,
California, or New York, New York, and, if the applicable Business Day
relates to any LIBOR Rate Advances or Alternate Currency Advances, on which
dealings in deposits in the Applicable Currency are carried on in the
London interbank market.
"Capitalized Lease Obligations" means any and all lease obligations which,
in accordance with generally accepted accounting principles, have been or
should be capitalized on the books of the lessee.
"Change in Control" means, with respect to any Person, the direct or
indirect acquisition by any other person (as such term is used in Section
13(d) and Section 14(d)(2) of the Exchange Act), or related persons
constituting a group (as such term is used in Rule 13d-5 under the Exchange
Act), of (a) beneficial ownership of issued and outstanding shares of
voting stock of such Person, the result of which acquisition is that such
other person or such group possesses in excess of 50 percent of the
combined voting power of all then-issued and outstanding voting stock of
such Person, or (b) the power to elect, appoint, or cause the election or
appointment of at least a majority of the members of the board of directors
of such Person.
"Commitment" means with respect to any Bank and at any time of its
determination, the amount set forth opposite such Bank's name on the
signature pages hereof, as such amount may be terminated, reduced, or
increased pursuant to Section 2.1(a)(ii), Section 2.14(b), Section 8.6(e),
or Article 6.
"Compliance Certificate" means a compliance certificate in substantially
the form of Exhibit C executed by an appropriate officer of the Borrower
evidencing the Borrower's compliance with the terms hereof.
"Credit Documents" means this Agreement, the Notes, the Guaranties, and
each other agreement, instrument, or document executed by the Borrower or
any Guarantor at any time in connection with this Agreement.
"Debt" means, for any Person and at any time of its determination, (a) the
indebtedness for borrowed money of such Person, (b) the Capitalized Lease
Obligations of such Person, (c) the obligations of such Person for the
purchase of property or services which have been deferred for 91 days or
more, (d) the obligations of such Person to assure the payment of such
indebtedness, Capitalized Lease Obligations, and deferred purchase prices
of others, whether by guarantee or agreement to purchase, provide funds for
payment, supply funds, or otherwise invest in the other debtor, and (e) the
unpaid amount of any accounts or notes receivable sold by such Person
(other than receivables sold to a consolidated subsidiary of such Person)
and, without duplication, any repurchase obligations, guarantees, or other
Document #0021220 4<PAGE>
<PAGE>
liabilities of such Person in connection with such sale; in each case of
(a) through (e) above whether direct or indirect, contingent or otherwise;
provided, however, that Debt shall not include accounts payable (other than
for borrowed money or for such deferred purchase price) and accrued
expenses incurred in the ordinary course of business if the same are not
overdue in a material amount or, if overdue, are being contested in good
faith and by appropriate proceedings, and Debt shall not include contingent
obligations for the payment of deferred purchase prices unless required to
be disclosed on the balance sheet of such Person in accordance with
generally accepted accounting principles.
"Default" means an Event of Default or an event which, with the giving of
notice or lapse of time or both, would constitute an Event of Default.
"Dollars or $" means lawful money of the United States of America.
"Dollar Equivalent" means (a) in relation to any amount denominated in
Dollars, the amount thereof and (b) in relation to an amount denominated in
any Alternate Currency, the amount of such Dollars required to purchase the
relevant stated amount of Alternate Currency at the Exchange Rate on the
date of determination. For the purposes of this Agreement, unless otherwise
expressly stated herein, the Dollar Equivalent principal amount of any
Alternate Currency A Advance shall be determined on the date on which the
borrowing notice is received with respect thereto and, in the case of any
Alternate Currency B Advance, the date on which the relevant offer from the
participating Banks is accepted by the Borrower under Section 2.2(b)(iii).
"Domestic Lending Office" means, with respect to any Bank, the office of
such Bank specified as its "Domestic Lending Office" opposite its name on
Schedule I hereto (or with respect to any assignee becoming a Bank
hereunder in accordance with Section 8.6(e), as set forth in the applicable
Assignment) or such other office of such Bank as such Bank may from time to
time specify to the Borrower and the Agent.
"Environmental Laws" means any and all federal, state, local, and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements, and other
governmental restrictions relating to the environment or to emissions,
discharges, or releases of pollutants, contaminants, petroleum or petroleum
products, chemicals, or industrial, toxic, or hazardous substances or
wastes into the environment including ambient air, surface water, ground
water, or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling of
pollutants, contaminants, petroleum or petroleum products, chemicals, or
industrial, toxic, or hazardous substances or wastes or the clean-up or
other remediation thereof.
"ERISA" means the Employment Retirement Income Security Act of 1974, as
amended from time to time, including any rules or regulations promulgated
thereunder.
"Eurocurrency Liabilities" has the meaning assigned to that term in
Regulation D of the Board of Governors of the Federal Reserve System, as in
effect from time to time.
"Events of Default" has the meaning specified in Article 6.
Document #0021220 5<PAGE>
<PAGE>
"Exchange Rate" means, in relation to the exchange of Dollars with an
Alternate Currency, the rate of exchange provided by the Federal Reserve
Bank of New York in its 12 Noon Midpoint - New York Interbank Market -
Consensus Rates on the date of determination for the spot purchase in the
foreign exchange market of the applicable amount of Dollars with such
Alternate Currency.
"Federal Funds Rate" means, for any period, a fluctuating interest rate per
annum equal for each day during such period to the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published for such day
(or, if such day is not a Business Day, for the next preceding Business
Day) by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day which is a Business Day, the average of the
quotations for such day on such transactions received by the Agent from
three Federal funds brokers of recognized standing selected by it.
"Fixed Rate Advance" means a LIBOR Rate Advance or a B Advance.
"Guaranties" means the Guaranty in the form of Exhibit D dated as of
November 18, 1996, made by Belden in favor of the Agent for the ratable
benefit of the Banks, any guaranties executed by Subsidiaries of the
Borrower pursuant to Section 5.5, and any other guaranty of the Advances or
any other obligations of the Borrower to the Banks or the Agent now or
hereafter executed.
"Guarantors" means Belden, any Subsidiaries of the Borrower which execute a
Guaranty pursuant to Section 5.5, and any other Affiliate of the Borrower
now or hereafter obligated to the Agent or the Banks under a Guaranty.
"Interest Period" means, with respect to each LIBOR Rate Advance comprising
part of the same A Borrowing or with respect to each B Advance bearing
interest based upon the LIBOR plus a margin as part of any B Borrowing, the
period commencing on the date of such Advance and ending on the last day of
the period selected by the Borrower pursuant to the provisions below. The
duration of each such Interest Period shall be one, two, three, or six
months, in each case as the Borrower may select in the applicable Request
For A Borrowing or Request for B Borrowing; provided, however, that:
(a) Interest Periods for Advances comprising part of the same
Borrowing shall be of the same duration;
(b) whenever the last day of any Interest Period would otherwise occur
on a day other than a Business Day, the last day of such Interest
Period shall be extended to occur on the next succeeding Business Day;
provided that if such extension would cause the last day of such
Interest Period to occur in the next following calendar month, the
last day of such Interest Period shall occur on the next preceding
Business Day;
(c) any Interest Period which begins on the last Business Day of the
calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month in
which it would have ended if there were a numerically corresponding
day in such calendar month; and
Document #0021220 6<PAGE>
<PAGE>
(d) the Borrower may not select an Interest Period for any Advance if
the last day of such Interest Period would be later than the
Termination Date.
"Leverage Ratio" means, with respect to Belden, the ratio of Belden's
consolidated Debt to Total Capitalization.
"LIBOR" means: (a) with respect to any A Borrowing, an interest rate per
annum equal to the rate per annum at which deposits in the Applicable
Currency are offered by the principal office of the Agent in London,
England, to prime banks in the London interbank market at 11:00 A.M.
(London time) two Business Days before the first day of such Interest
Period in an amount substantially equal to the amount of the LIBOR Rate
Advance of the Agent comprising part of such A Borrowing to be outstanding
during the applicable Interest Period for such A Borrowing; and (b) with
respect to any B Borrowing, an interest rate per annum equal to the rate
per annum at which deposits in an amount substantially equal to the
smallest B Advance to be made as part of such B Borrowing in the Applicable
Currency for such B Borrowing and for periods substantially equal to the
period of such B Borrowing are offered by the principal office of the Agent
in London, England, to prime banks in the London interbank market at 11:00
A.M. (London time) two Business Days before the date of such B Borrowing.
"LIBOR Rate Advance" means an A Advance which bears interest as provided in
Section 2.4(a)(ii).
"LIBOR Reserve Percentage" means, with respect to any Bank for the Interest
Period for any LIBOR Rate Advance, the reserve percentage applicable during
such Interest Period (or if more than one such percentage shall be so
applicable, the daily average of such percentages for those days in such
Interest Period during which any such percentage shall be so applicable)
under regulations issued from time to time by the Board of Governors of the
Federal Reserve System (or any successor) for determining the maximum
reserve requirement (including any emergency, supplemental, or other
marginal reserve requirement) for such Bank with respect to liabilities or
assets consisting of or including Eurocurrency Liabilities having a term
equal to such Interest Period.
"Majority Banks" means, at any time, Banks having at least 66-2/3% of the
Commitments or, if all Commitments have terminated, Banks holding at least
66-2/3% of the then aggregate outstanding principal amount of the Advances
held by the Banks.
"Net Worth" means, for any Person and at any time of its determination, the
consolidated shareholders' equity of such Person determined in accordance
with generally accepted accounting principles.
"Note" means an A Note or a B Note.
"Offer of B Advances" means an Offer of B Advances in the form of Exhibit
B-3, fully completed with the required information specified therein and
executed by a Bank.
"Operating Earnings" means, for any Person and for any period of its
determination, the consolidated income of such Person for such period
before extraordinary items, income taxes, interest expense, general
corporate expenses, and changes in accounting principles, determined in
accordance with generally accepted accounting principles.
Document #0021220 7<PAGE>
<PAGE>
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"Payment Office" means, with respect to the Agent for payment in Dollars or
Alternate Currency, the address for payments in the relevant currency to
the Agent set forth on Schedule I or such other address as the Agent may
from time to time specify in accordance with Section 8.2.
"Person" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association,
joint venture, or other entity, or a government or any political
subdivision or agency thereof, or any trustee, receiver, custodian, or
similar official.
"Plan" means any employee benefit or other plan maintained by the Borrower
or any of its Subsidiaries for their employees and covered by Title IV of
ERISA or to which Section 412 of the Internal Revenue Code of 1986, as
amended, applies.
"Reference Rate" means the rate of interest in effect for such day as
publicly announced from time to time by Bank of America National Trust and
Savings Association in San Francisco, California, as its "reference rate".
(The "reference rate" is a rate set by Agent based upon various factors
including its cost and desired return, general economic conditions and
other factors, and is used as a reference point for pricing some loans,
which may be priced at, above, or below such announced rate. Any change in
the reference rate announced by Agent shall take effect at the opening of
business on the day specified in the public announcement of such change.)
"Regulatory Change" means any change after the date of the Agreement in
United States federal or state, or foreign, laws or regulations or the
adoption or making after such date of any interpretations, directives, or
requests applying to a class of banks including any Bank of or under any
United States federal or state, or any foreign, laws or regulations
(whether or not having the force of law) by any court or governmental or
monetary authority charged with the interpretation or administration
thereof.
"Request for Borrowing" means a Request For A Borrowing or a Request For B
Borrowing.
"Request for A Borrowing" means a Request For A Borrowing in the form of
Exhibit B-1, fully completed with the required information specified
therein and executed by the Borrower.
"Request for B Borrowing" means a Request for B Borrowing in the form of
Exhibit B-2, fully completed with the required information specified
therein and executed by the Borrower.
"Significant Subsidiary" means, with respect to the Borrower and at any
time of its determination, any Subsidiary of the Borrower which has
contributed five percent or more of the consolidated revenues of the
Borrower for the fiscal year of the Borrower most recently ended.
"Subsidiary" means, with respect to any Person and at any time of its
determination, any corporation, partnership, or other business entity for
which such Person directly or indirectly owns at least a majority of the
securities or ownership interests having ordinary voting power for the
Document #0021220 8<PAGE>
<PAGE>
election of directors or other management of such corporation, partnership,
or other business entity (other than securities or ownership interests
having such power only by reason of the happening of a contingency).
"Termination Date" means (a) November 18, 2001, or (b) any earlier date of
the termination in whole of the Commitments pursuant to Section 2.1(a)(ii)
or Article 6.
"Termination Event" means any event or condition which would constitute
grounds under Section 4042 of ERISA for the termination of, or for the
appointment of a trustee to administer, any Plan.
"Total Capitalization" means, for any Person and at any time of its
determination, the sum of the consolidated Debt of such Person and the
consolidated Net Worth of such Person.
"Type" shall have the meaning set forth in the definition of the term "A
Advance" above.
Section 1.2 Computation of Time Periods. In this Agreement in the
computation of periods of time from a specified date to a later specified
date, the word "from" means "from and including" and the words "to" and
"until" each means "to but excluding."
Section 1.3 Accounting Terms. All accounting terms not specifically defined
herein shall be construed in accordance with generally accepted accounting
principles, and each reference herein to "generally accepted accounting
principles" shall mean generally accepted accounting principles consistent
with those applied in the preparation of the financial statements referred
to in Section 4.3.
Section 1.4 Miscellaneous. The words "hereof," "herein," and "hereunder"
and words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this Agreement,
and Article, Section, Schedule, and Exhibit references are to Articles and
Sections of and Schedules and Exhibits to this Agreement, unless otherwise
specified.
ARTICLE 2.
CREDIT FACILITY
Section 2.1 The A Advances.
(a) Commitment.
(i) Each Bank severally agrees, on the terms and conditions
hereinafter set forth, to make A Advances to the Borrower from
time to time on any Business Day during the period from the date
hereof until the Termination Date in an aggregate outstanding
Dollar Equivalent principal amount not to exceed such Bank's
Commitment, provided that following the making of any A Borrowing
the aggregate outstanding Dollar Equivalent principal amount of
Advances shall not exceed the aggregate amount of the
Commitments. Each A Borrowing shall consist of A Advances of the
same Type and the same Applicable Currency made to the Borrower
on the same day by the Banks ratably in accordance with their
respective Commitments. Within the limits set forth in this
Document #0021220 9<PAGE>
<PAGE>
Section 2.1, the Borrower may from time to time borrow pursuant
to paragraph (b) below, prepay pursuant to paragraph (c) below,
and reborrow under this Section 2.1. The indebtedness of the
Borrower resulting from the A Advances made from time to time by
each Bank shall be conclusively evidenced by the records of such
Bank, absent manifest error, and, if requested by such Bank,
evidenced by an A Note of the Borrower payable to the order of
such Bank.
(ii) The Borrower shall have the right, upon at least five
Business Days' notice to the Agent, to terminate in whole or
reduce ratably in part the unused portions of the respective
Commitments of the Banks, provided that each partial reduction
shall be in the aggregate amount of at least $5,000,000 and be
made in increments of $1,000,000, and provided further that the
aggregate amount of the Commitments of the Banks shall not be
reduced to an amount which is less than the aggregate Dollar
Equivalent principal amount of the Advances then outstanding. Any
such reduction or termination of the Commitments shall be
permanent.
(b) Method of Advancing.
(i) The Borrower may request an A Borrowing by delivering to the
Agent, not later than 11:00 A.M. (Chicago time), a Request for A
Borrowing, in the case of a proposed Borrowing comprised of LIBOR
Rate Advances, at least three Business Days prior to the date of
the proposed Borrowing, and in the case of a proposed Borrowing
comprised of Base Rate Advances, on the Business Day of the
proposed Borrowing. The Agent shall give to each Bank prompt
notice thereof. Each A Borrowing comprised of Base Rate Advances
shall be in Dollars and shall be in an aggregate principal amount
of not less than $1,000,000 and be made in $100,000 multiples.
Each A Borrowing comprised of LIBOR Rate Advances shall be in an
aggregate Dollar Equivalent principal amount of not less than
$5,000,000 and be made in 1,000,000 unit multiples of the
Applicable Currency. In the case of a proposed A Borrowing
comprised of LIBOR Rate Advances, the Agent shall promptly notify
each Bank of the applicable interest rate under Section
2.4(a)(ii). At no time shall there be outstanding more than five
A Borrowings comprised of LIBOR Rate Advances. Each Bank shall,
before 11:00 A.M. (local time at the applicable Payment Office)
on the date of such A Borrowing, make available for the account
of its Applicable Lending Office to the Agent at its Payment
Office, in same day funds, such Bank's ratable portion of such A
Borrowing. Upon fulfillment of the applicable conditions set
forth herein and, except as specified in paragraph (iv) below,
after receipt by the Agent of such funds, the Agent shall make
such funds available to the Borrower at the Agent's applicable
Payment Office.
(ii) If the Borrower has requested a proposed A Borrowing
consisting of LIBOR Rate Advances and then receives notice of
circumstances referred to in Sections 2.9(b), 2.12, or 2.13 the
result of which is that any part of such A Borrowing would not
consist of LIBOR Rate Advances, the Borrower may, by notice given
not later than 11:00 A.M. (Chicago time) at least two Business
Days prior to the date such proposed A Borrowing would otherwise
Document #0021220 10<PAGE>
<PAGE>
be made, cancel such A Borrowing, in which case such A Borrowing
shall be cancelled and no Advances shall be made as a result of
such requested A Borrowing, but the Borrower shall indemnify the
Banks which are not subject to one of the circumstances referred
to above in connection with such cancellation as contemplated by
Section 2.8.
(iii) Except as specified in paragraph (ii) above, each Request
for A Borrowing shall be irrevocable and binding on the Borrower,
and the Borrower shall indemnify the Banks in accordance with
Section 2.8 for any failure to borrow any requested A Borrowing
comprised of LIBOR Rate Advances, including failures caused by
the Borrower's failure to fulfill the applicable conditions
precedent.
(iv) Unless the Agent shall have received notice from a Bank
prior to the date of any A Borrowing that such Bank shall not
make available to the Agent such Bank's ratable portion of such A
Borrowing, the Agent may assume that such Bank has made such
portion available to the Agent on the date of such A Borrowing in
accordance with paragraph (a) of this Section 2.1 and the Agent
may, in reliance upon such assumption, make available to the
Borrower on such date a corresponding amount. If and to the
extent that such Bank shall not have so made such ratable portion
available to the Agent, such Bank and the Borrower severally
agree to repay to the Agent forthwith on demand such
corresponding amount together with interest thereon, for each day
from the date such amount is made available to the Borrower until
the date such amount is repaid to the Agent, at (A) in the case
of the Borrower, the interest rate applicable at the time to the
A Advances comprising such A Borrowing computed on the same basis
and (B) in the case of such Bank, the Federal Funds Rate computed
on the basis of a year of 360-days for the actual number of days
elapsed, with respect to an A Advance to be made in Dollars, or
the Agent's cost of funds for the Applicable Currency computed on
the same basis as regular interest on loans made hereunder in
such Applicable Currency, with respect to an A Advance to be made
in an Alternate Currency, provided that if such amount is not
repaid by such Bank by the end of the second day after the date
of the Agent's demand, the interest rates specified under (B)
above shall be increased by an additional 2% per annum on the
third day after the date of the Agent's demand and shall remain
at such increased rate thereafter. If such Bank shall repay to
the Agent such corresponding amount, such amount so repaid shall
constitute such Bank's A Advance as part of such A Borrowing for
purposes of this Agreement. The failure of any Bank to make the A
Advance to be made by it as part of any A Borrowing shall not
relieve any other Bank of its obligation, if any, hereunder to
make its A Advance on the date of such A Borrowing, but no Bank
shall be responsible for the failure of any other Bank to make
the A Advance to be made by such other Bank on the date of any A
Borrowing.
(c) Prepayment. The Borrower may prepay any A Borrowing by giving the
Agent at least one Business Day's notice, with respect to an A
Borrowing comprised of Base Rate Advances, and three Business Days'
notice, with respect to an A Borrowing comprised of LIBOR Rate
Advances, stating the proposed Business Day and aggregate principal
Document #0021220 11<PAGE>
<PAGE>
amount of the prepayment. If such notice is given the Borrower shall
prepay the outstanding principal amounts of the A Advances comprising
part of such A Borrowing in whole or ratably in part, together with
accrued interest to the date of such prepayment on the principal
amount prepaid and amounts, if any, required to be paid pursuant to
Section 2.8 as a result of such prepayment. Each partial prepayment
pursuant to this Section 2.1(c) with respect to an A Borrowing
comprised of Base Rate Advances shall be made in $100,000 multiples
and in an aggregate principal amount such that after giving effect
thereto such A Borrowing shall have a principal amount outstanding of
at least $1,000,000. Each partial prepayment pursuant to this Section
2.1(c) with respect to an A Borrowing comprised of LIBOR Rate Advances
shall be made in 1,000,000 unit multiples of the Applicable Currency
and in an aggregate principal amount such that after giving effect
thereto such A Borrowing shall have a Dollar Equivalent principal
amount outstanding of at least $5,000,000.
(d) Repayment. The Borrower shall repay the unpaid principal amount of
each Base Rate Advance on the Termination Date. The Borrower shall
repay the unpaid principal amount of each LIBOR Rate Advance on the
last day of the Interest Period for such LIBOR Rate Advance; provided
that if any LIBOR Rate Advance denominated in Dollars is not repaid at
the expiration of the Interest Period for such LIBOR Rate Advance,
such LIBOR Rate Advance shall automatically convert to a Base Rate
Advance.
Section 2.2 The B Advances.
(a) Generally. Each Bank severally agrees that the Borrower may
request B Borrowings under this Section 2.2 from time to time on any
Business Day during the period from the date hereof until the date
occurring 30 days prior to the Termination Date in the manner set
forth below; provided that, following the making of each B Borrowing,
the aggregate outstanding Dollar Equivalent principal amount of the
Advances shall not exceed the aggregate amount of the Commitments.
Within the limits and on the conditions set forth in this Section 2.2,
the Borrower may from time to time borrow pursuant to paragraph (b)
below, prepay and repay pursuant to paragraphs (c) and (d) below, and
reborrow under this Section 2.2. The indebtedness of the Borrower
resulting from each B Advance made to the Borrower as part of a B
Borrowing shall be conclusively evidenced by the records of each Bank
making such B Advances, absent manifest error, and, upon request of
such Bank, by a separate B Note of the Borrower payable to the order
of such Bank.
(b) Method of Advancing.
(i) The Borrower may request a B Borrowing by delivering to the
Agent, not later than 9:00 A.M. (Chicago time), a Request for B
Borrowing at least four Business Days prior to the date of the
proposed B Borrowing, with respect to B Borrowings to be
comprised of Alternate Currency B Advances or B Advances with
interest rates to be determined based upon the LIBOR, and at
least one Business Day prior to the date of the proposed B
Borrowing, with respect to B Borrowings to be comprised of Dollar
B Advances with interest rates to be based upon an absolute rate.
Each proposed B Borrowing shall be in an aggregate Dollar
Equivalent principal amount of not less than $2,000,000, be made
Document #0021220 12<PAGE>
<PAGE>
in 1,000,000 unit multiples of the Applicable Currency, and
otherwise conform to the requirements specified in Exhibit B-2.
Any Request for B Borrowing that does not substantially conform
to the form of Exhibit B-2 and contain the information required
therein may be rejected by the Agent by delivering prompt notice
of the rejection to the Borrower. The Agent shall promptly notify
the Banks of the Request for B Borrowing and the terms of the
proposed B Borrowing. Without the prior approval of the Agent, no
B Borrowing may be requested within five Business Days of the
delivery of any other Request for B Borrowing and no more than
three Requests for B Borrowings may be delivered in any month.
(ii) Each Bank may, in its sole discretion, irrevocably offer or
decline to offer to make one or more B Advances to the Borrower
as part of such proposed B Borrowing by providing the Agent with
an Offer of B Advances notifying the Agent of such decision
before 9:00 A.M. (Chicago time) at least three Business Days
prior to the date of the proposed B Borrowing, with respect to B
Borrowings to be comprised of Alternate Currency B Advances or B
Advances with interest rates to be determined based upon the
LIBOR and on the Business Day of the proposed B Borrowing, with
respect to B Borrowings to be comprised of Dollar B Advances with
interest rates to be based upon an absolute rate. If the Agent,
in its capacity as a Bank hereunder, elects to make any offers in
response to any Request for B Borrowing, the Agent shall make its
offers in accordance with this paragraph except that the Agent
shall deliver its Offer of B Advances directly to the Borrower
before 8:30 A.M. (Chicago time) on the applicable date. Each
offer to make a B Advance must be in a minimum Dollar Equivalent
principal amount of $2,000,000, be made in 1,000,000 unit
multiples of the Applicable Currency, and otherwise conform to
the requirements specified in Exhibit B-3. Any Offer of B
Advances that does not substantially conform to the form of
Exhibit B-3 and contain the information required therein may be
rejected by the Agent by delivering prompt notice of the
rejection to the Bank which has submitted the rejected Offer of B
Advances. The Agent shall promptly notify the Borrower of all
Offers of B Advances. Any Bank which has not responded to the
Agent prior to the time specified above shall be deemed to have
elected to decline to make such an offer. Any Offer of B Advances
submitted pursuant to this paragraph shall be irrevocable.
(iii) The Borrower shall, in turn, before 10:00 A.M. (Chicago
time) at least three Business Days prior to the date of the
proposed B Borrowing, with respect to B Borrowings to be
comprised of Alternate Currency B Advances or B Advances with
interest rates to be determined based upon the LIBOR, and on the
Business Day of the proposed B Borrowing, with respect to B
Borrowings to be comprised of Dollar B Advances with interest
rates to be based upon an absolute rate, either (A) cancel such B
Borrowing by giving the Agent notice to that effect, or (B)
accept one or more of the offers made by any Bank or Banks by
giving the Agent an Acceptance of B Advances stating the amount
of B Advances offered by the Banks which the Borrower has
accepted and of the rejection of the remaining offers made by the
Banks. If the Borrower does not timely respond, the Borrower
shall be deemed to have rejected all of the offers. If the
Borrower elects to accept any offers, the resulting B Borrowing
Document #0021220 13<PAGE>
<PAGE>
must be in an aggregate Dollar Equivalent principal amount of not
less than $2,000,000, be made in 1,000,000 unit multiples of the
Applicable Currency, and cannot exceed the principal amount
specified in the relevant Request for B Borrowing. The Borrower
must accept offers made by the Banks on the basis of the lowest
interest rate offers first. Subject to the provisions of the next
sentence, all offers of individual B Advances must be accepted in
at least the minimum amount specified in the applicable Offer of
B Advances or rejected in whole. If multiple offers are made at
the same interest rate, all offers accepted by the Borrower at
such interest rate must be allocated by the Borrower among the
Banks having made offers at such interest rate ratably based upon
the maximum amounts of such offers made by the Banks, provided
that if the effect of the ratable allocation would cause the
amount allocated to any Bank to be less than a Dollar Equivalent
principal amount of $500,000, then the Borrower shall reject the
smallest offers made at such interest rate first such that the
ratable allocation to the remaining offers at such interest rate
results in all remaining offers which are accepted having minimum
Dollar Equivalent principal amounts greater than $500,000, but in
the event that offers at the same interest rate are in equal
principal amounts, the Borrower may in its discretion select
which such equal principal offers to reject first to ensure that
all remaining offers which are accepted have minimum Dollar
Equivalent principal amounts greater than $500,000.
Notwithstanding the foregoing, the Borrower may in its discretion
adjust the ratable allocation to any Bank by an amount up to
50,000 units of the Applicable Currency. Any Acceptance of B
Advances that does not substantially conform to the form of
Exhibit B-4 and otherwise contain the information required
therein may be rejected by the Agent by delivering prompt notice
of the rejection to the Borrower. Each Acceptance of B Advances
shall be irrevocable and binding on the Borrower, and the
Borrower shall indemnify the Banks in accordance with Section 2.8
for any failure to borrow any accepted B Advances, including
failures caused by the Borrower's failure to fulfill the
applicable conditions precedent.
(iv) The Agent shall in turn promptly notify the Banks of the
cancellation of the B Borrowing or of the date and aggregate
amount of such B Borrowing, including the ranges of bids
submitted and the highest and lowest bids accepted for each
Interest Period. The Agent shall promptly notify each Bank that
is to make a B Advance as part of such B Borrowing of the amount
of each B Advance to be made by such Bank as part of such B
Borrowing and, if the interest rate basis for such B Borrowing is
an absolute rate, the applicable interest rate for each such B
Advance. If the interest rate basis for the B Borrowing is the
LIBOR plus a margin, the Agent shall provide each Bank that is to
make a B Advance as part of such B Borrowing with the appropriate
LIBOR and the applicable interest rate for each such B Advance
promptly after determining the same. Each Bank that is to make a
B Advance as part of such B Borrowing shall, before 11:00 A.M.
(local time at the applicable Payment Office) on the date of such
B Borrowing specified in the notice received from the Agent, make
available to the Agent at the Agent's Payment Office such Bank's
portion of such B Borrowing, in immediately available funds. Upon
fulfillment of the applicable conditions set forth herein and,
Document #0021220 14<PAGE>
<PAGE>
except as specified in paragraph (v) below, after receipt by the
Agent of such funds, the Agent shall make such funds available to
the Borrower at the Agent's applicable Payment Office.
(v) Unless the Agent shall have received notice from a Bank prior
to the date of any B Borrowing that such Bank shall not make
available to the Agent such Bank's portion of such B Borrowing,
the Agent may assume that such Bank has made such portion
available to the Agent on the date of such B Borrowing in
accordance with paragraph (a) of this Section 2.2 and the Agent
may, in reliance upon such assumption, make available to the
Borrower on such date a corresponding amount. If and to the
Document #0021220 15 <PAGE>
<PAGE>
extent that such Bank shall not have so made such ratable portion
available to the Agent, such Bank and the Borrower severally
agree to repay to the Agent forthwith on demand such
corresponding amount together with interest thereon, for each day
from the date such amount is made available to the Borrower
until the date such amount is repaid to the Agent, at (i) in the
case of the Borrower, the interest rate applicable at the time to
the B Advances comprising such B Borrowing computed on the same
basis and (ii) in the case of such Bank, the Federal Funds Rate
computed on the basis of a year of 360 days for the actual number
of days elapsed, with respect to an B Advance to be made in
Dollars, or the Agent's cost of funds for the Applicable Currency
computed on the same basis as regular interest on loans made
hereunder in such Applicable Currency, with respect to an B
Advance to be made in an Alternate Currency, provided that if
such amount is not repaid by such Bank by the end of the second
day after the date of the Agent's demand, the interest rates
specified under (ii) above shall be increased by an additional 2%
per annum on the third day after the date of the Agent's demand
and shall remain at such increased rate thereafter. If such Bank
shall repay to the Agent such corresponding amount, such amount
so repaid shall constitute such Bank's B Advance as part of such
B Borrowing for purposes of this Agreement. The failure of any
Bank to make the B Advance to be made by it as part of any B
Borrowing shall not relieve any other Bank of its obligation, if
any, hereunder to make its B Advance on the date of such B
Borrowing, but no Bank shall be responsible for the failure of
any other Bank to make the B Advance to be made by such other
Bank on the date of any B Borrowing.
(c) Prepayment. The Borrower may prepay any B Borrowing by giving the
Agent three Business Days' notice stating the proposed Business Day
and aggregate principal amount of the prepayment. If such notice is
given the Borrower shall prepay the outstanding principal amounts of
the B Advances comprising part of such B Borrowing in whole or ratably
in part, together with accrued interest to the date of such prepayment
on the principal amount prepaid and amounts, if any, required to be
paid pursuant to Section 2.8 as a result of such prepayment. Each
partial prepayment pursuant to this Section 2.2(c) with respect to any
B Borrowing shall be made in 1,000,000 unit multiples of the
Applicable Currency and in an aggregate principal amount such that
after giving effect thereto such B Borrowing shall have a Dollar
Equivalent principal amount outstanding of at least $2,000,000.
(d) Repayment. The Borrower shall repay to the Agent for the account
of each Bank which has made a B Advance to the Borrower on the
maturity date of each B Advance (such maturity date being that
specified by the Borrower for repayment of such B Advance in the
related Acceptance of B Advances delivered pursuant to paragraph
(b)(iii) above) the then unpaid principal amount of such B Advance.
Section 2.3 Fees.
(a) Facility Fee. The Borrower agrees to pay each Bank the Applicable
Facility Fee on such Bank's Commitment from time to time from the date
hereof until the Termination Date at a rate per annum equal to the
Applicable Facility Fee in effect from time to time, payable in
arrears on the last day of each calendar quarter during the term of
Document #0021220 16<PAGE>
<PAGE>
such Bank's Commitment, and on the Termination Date. All computations
of the fees shall be made by the Agent on the basis of a 365/366-day
year for the actual number of days elapsed.
(b) Agent's Fee. The Borrower agrees to pay to the Agent, for its sole
account, the fees set forth in the Agent's Fee Letter. The Borrower's
obligations under the Agent's Fee Letter are independent of the
satisfaction of the conditions to effectiveness set forth in Section
3.1 of this Agreement.
Section 2.4 Interest.
(a) A Advances. The Borrower shall pay each Bank interest on the
unpaid principal amount of each A Advance made by such Bank from the
date of such A Advance until such principal amount shall be paid in
full, at the following rates per annum:
(i) Base Rate Advances. If such A Advance is a Base Rate Advance,
at a rate per annum equal at all times to the Base Rate in effect
from time to time for such A Advance, payable on the last day of
each calendar quarter while such A Advance is outstanding and on
the Termination Date. All computations of interest on Base Rate
Advances shall be made by the Agent on the basis of a 365/366-day
year for the actual number of days elapsed; and
(ii) LIBOR Rate Advances. If such A Advance is a LIBOR Rate
Advance, at a rate per annum equal at all times during the
Interest Period for such A Advance to the sum of the LIBOR for
such Interest Period plus the Applicable Interest Margin in
effect from time to time for such A Advance , payable on the last
day of such Interest Period and, if such Interest Period has a
duration of more than three months, on each day which occurs
during such Interest Period every three months from the first day
of such Interest Period. All computations of interest on LIBOR
Rate Advances shall be made by the Agent on the basis of a
360-day year or, in the case of an Alternate Currency Advance, on
the basis which is customary for the computation of interest in
the Applicable Currency in the London interbank market, in each
case for the actual number of days elapsed.
(b) Additional Interest on LIBOR Rate Advances. The Borrower shall pay
to each Bank, so long as such Bank shall be required under regulations
of the Board of Governors of the Federal Reserve System to maintain
reserves with respect to liabilities or assets consisting of or
including Eurocurrency Liabilities, additional interest on the unpaid
principal amount of each LIBOR Rate Advance of such Bank, from the
date of such Advance until such principal amount is paid in full, at
an interest rate per annum equal at all times to the difference
obtained by subtracting (i) the LIBOR for the Interest Period for such
Advance from (ii) the rate obtained by dividing such LIBOR by a
percentage equal to lOO% minus the LIBOR Reserve Percentage of such
Bank for such Interest Period, payable on each date on which interest
is payable on such Advance. Such additional interest shall be
determined by such Bank and notified to the Borrower through the
Agent. A certificate in reasonable detail as to the amount of such
additional interest submitted to the Borrower and the Agent by such
Bank shall be conclusive evidence thereof, absent manifest error.
Document #0021220 17<PAGE>
<PAGE>
(c) B Advances. The Borrower shall pay interest on the unpaid
principal amount of each B Advance from the date of such B Advance to
the date the principal amount of such B Advance shall be paid in full,
at the rate of interest for such B Advance specified by the Bank
making such B Advance in its Offer of B Advances with respect thereto
delivered pursuant to Section 2.2(b)(ii) above, payable on the
interest payment date or dates specified by the Borrower for such B
Advance in the related Acceptance of B Advances delivered pursuant to
Section 2.2(b)(iii) above. All computations of interest on B Advances
shall be made by the Agent on the basis specified in the relevant
Acceptance of B Advances delivered pursuant to Section 2.2(b)(iii)
above, or in the absence of such specification on the basis of a
360-day year or, in the case of an Alternate Currency Advance, on the
basis which is customary for the computation of interest in the
Applicable Currency in the London interbank market, but in any case
for the actual number of days elapsed.
Section 2.5 Payments, Etc.
(a) The Borrower shall make each payment under the Credit Documents to
be made by it not later than 12:00 P.M. (local time at the place of
payment) on the day when due in the Applicable Currency to the Agent
at the Agent's applicable Payment Office in immediately available
funds. The Applicable Currency for principal and interest payments
shall be the currency in which the related Advance was made. The
Applicable Currency for all other payments hereunder shall be Dollars.
The Agent shall promptly thereafter cause to be distributed like funds
relating to the payment of principal, interest or fees ratably (other
than amounts payable pursuant to Section 2.2, 2.4(b), 2.8, 2.9, 2.10,
2.11, or 2.14(b)) to the Banks for the account of their respective
Applicable Lending Offices, and like funds relating to the payment of
any other amount payable to any Bank to such Bank for the account of
its Applicable Lending Office, in each case to be applied in
accordance with the terms of this Agreement. In no event shall any
Bank be entitled to share any fees paid to the Agent pursuant to
Section 2.3(b) or any other fee paid to the Agent, as such.
(b) Whenever any payment under the Credit Documents shall be stated to
be due on a day other than a Business Day, such payment shall be made
on the next succeeding Business Day, and such extension of time shall
in such case be included in the computation of payment of interest or
fee, as the case may be.
(c) Unless the Agent shall have received notice from the Borrower
prior to the date on which any payment is due by the Borrower to any
Bank hereunder that the Borrower shall not make such payment in full,
the Agent may assume that the Borrower has made such payment in full
to the Agent on such date and the Agent may, in reliance upon such
assumption, cause to be distributed to each Bank on such due date an
amount equal to the amount then due such Bank. If and to the extent
the Borrower shall not have so made such payment in full to the Agent,
each Bank shall repay to the Agent forthwith on demand such amount
distributed to such Bank together with interest thereon, for each day
from the date such amount is distributed to such Bank until the date
such Bank repays such amount to the Agent, at the Federal Funds Rate
computed on the basis of a year of 360 days for the actual number of
days elapsed, with respect to an amount due in Dollars, or the Agent's
cost of funds computed on the same basis as regular interest on loans
Document #0021220 18<PAGE>
<PAGE>
made hereunder in such Applicable Currency, with respect to an amount
due in an Alternate Currency, and if such amount is not repaid by the
end of the second day after the date of the Agent's demand, the
interest rates specified shall be increased by an additional 2% per
annum on the third day after the date of the Agent's demand and shall
remain at such increased rate thereafter.
(d) Whenever any reference is made to any Bank's "ratable share" or
"ratable portion" (or any similar reference) of any amount hereunder,
such share or portion shall be calculated to at least eight decimal
places, rounding up or down, as appropriate.
(e) Except as provided in Sections 2.1(b)(iv), 2.2(b)(v), and 2.5(c),
any amount payable under the Credit Documents (including principal,
interest, fees, and other amounts) which is not paid when due (whether
at stated maturity, by acceleration, or otherwise) shall bear
interest, to the extent permitted by law, from the date on which such
amount became due until such amount is paid in full, payable on
demand, at a rate per annum equal at all times to the greater of (i)
the sum of the Base Rate in effect from time to time plus 2% per annum
computed on the basis of a year of 365/366 days for the actual number
of days elapsed, with respect to amounts due in Dollars, or (ii) the
applicable Bank's cost of funds for the Applicable Currency plus 2%
per annum computed on the same basis as regular interest on loans made
hereunder in such Applicable Currency, with respect to principal and
interest due on B Advances due in an Alternate Currency, and the
Agent's cost of funds for the Applicable Currency plus 2% per annum
computed on the same basis as regular interest on loans made hereunder
in such Applicable Currency, with respect to all other amounts due in
an Alternate Currency .
(f) If any sum due from the Borrower under this Agreement or any order
or judgment given in relation hereto has to be converted from the
currency (the "first currency") in which the same is payable hereunder
or under such order or judgment into another currency (the "second
currency") for the purpose of (i) making or filing a claim or proof
against the Borrower with any governmental authority or in any court
or tribunal or (ii) enforcing any order or judgment given in relation
hereto, the Borrower shall indemnify each of the Persons to whom such
sum is due against any loss actually suffered as a result of any
discrepancy between (a) the rate of exchange used when restating the
amount in question from the first currency into the second currency
and (b) the rate or rates of exchange at which such Person, acting in
good faith in a commercially reasonable manner, purchased the first
currency with the second currency after receipt of a sum paid to it in
the second currency in satisfaction, in whole or in part, of any such
order, judgment, claim, or proof. The foregoing indemnity shall
constitute a separate obligation of the Borrower distinct from its
other obligations hereunder and shall survive the giving or making of
any judgment or order in relation to all or any of such other
obligations.
Section 2.6 Payments Pro Rata. Except as provided in Sections 2.2, 2.4(b),
2.8, 2.9, 2.10, 2.11, and 2.14(b), each of the Banks agrees that if it
should receive any payment (whether by voluntary payment, by realization
upon security (if any), by the exercise of the right of setoff or banker's
lien, by counterclaim or cross action, by the enforcement of any right
under the Credit Documents, or otherwise) in respect of any obligation
Document #0021220 19<PAGE>
<PAGE>
ofthe Borrower to pay principal, interest, fees, or any other obligation
incurred under the Credit Documents in a proportion greater than the total
amount of principal, interest, fees, or any other obligation incurred, as
the case may be, then owed and due to such Bank bears to the total amount
of principal, interest, fees, or any such other obligation then owed and
due to all of the Banks immediately prior to such receipt, then such Bank
receiving such excess payment shall purchase for cash without recourse from
the other Banks an interest in the obligations of the Borrower to such
Banks in such amount as shall result in a proportional participation by all
of the Banks in the aggregate unpaid amount of principal, interest, fees,
or any such other obligation, as the case may be, owed to all of the Banks;
provided that if all or any portion of such excess payment is thereafter
recovered from such Bank, such purchase shall be rescinded and the purchase
price restored to the extent of such recovery, but without interest.
Section 2.7 Taxes. If any taxes, other than (i) taxes imposed on the
overall net income of any Bank or the Agent or of the Applicable Lending
Office of any Bank or the Agent (the "Net Income Taxes"), or (ii) taxes
which are Increased Costs (which are covered by Section 2.9), are at any
time imposed on any payments required by the Borrower under or in respect
of this Agreement or any related instrument or agreement, the Borrower
shall pay all such taxes. It is agreed that if the Borrower shall be
required by law to deduct any such taxes from or in respect of any sum
payable by it hereunder to any Bank or the Agent, (x) the sum payable shall
be increased as may be necessary so that, after making all required
deductions, such Bank or the Agent receives an amount equal to the sum it
would have received had no such deductions been made, (y) the Borrower
shall make such deductions, and (z) the Borrower shall pay the full amount
deducted to the relevant taxation authority or other authority in
accordance with applicable law.
Section 2.8 Breakage Costs. The Borrower shall pay to any Bank, upon the
request of such Bank, such amount or amounts as shall be sufficient to
compensate such Bank for any loss, cost, or expense incurred by such Bank
as a result of (a) any payment or prepayment of a Fixed Rate Advance on a
date other than the scheduled payment date for such Fixed Rate Advance; or
(b) any failure by the Borrower to borrow any Fixed Rate Advance on the
date for such borrowing specified in the relevant Request for Borrowing
hereunder, including failures caused by the Borrower's failure to fulfill
the applicable conditions precedent for such borrowing; such compensation
to include an amount equal to the excess, if any, of (i) the amount of
interest which would have accrued on the principal amount so paid, prepaid,
or not borrowed for the period from the date of such payment, prepayment,
or failure to borrow to the scheduled payment date for such Fixed Rate
Advance (the "Calculated Accrued Interest") at the applicable rate of
interest for such Fixed Rate Advance provided for herein over (ii) the
Calculated Accrued Interest at the LIBOR as of the date of such payment,
prepayment, or failure to borrow for deposits of comparable amounts,
maturities, and Applicable Currencies. Any Bank claiming amounts under this
Section 2.8 shall submit calculations of the amounts due to the Borrower
and the Agent in certificates in reasonable detail, and such calculations
if reasonable and made in good faith shall be conclusive evidence thereof,
absent manifest error.
Section 2.9 Increased Costs.
(a) The Borrower shall pay any Bank from time to time such amounts as
such Bank determines to be necessary to compensate such Bank for any
Document #0021220 20<PAGE>
<PAGE>
increases in costs incurred by such Bank attributable to such Bank
making or maintaining of any Fixed Rate Advances, or any reduction in
any amount receivable by such Bank under this Agreement in respect of
any of such Fixed Rate Advances (such increases in costs and
reductions in amounts receivable being herein called "Additional
Costs") resulting from any Regulatory Change which: (i) changes the
basis of taxation of, or imposes any new taxes or withholdings on, any
amounts payable to such Bank under this Agreement in respect of any of
such Fixed Rate Advances (other than Net Income Taxes); or (ii)
imposes or modifies any reserve, special deposit, deposit insurance
assessment, or similar requirements relating to any extensions of
credit or other assets of, or any deposits with or other liabilities
of, such Bank (including any such Fixed Rate Advances or any deposits
referred to in the definition of "LIBOR," but excluding any amounts
covered by Section 2.4(b)); or (iii) imposes any other condition
affecting this Agreement or any such extensions of credit or
liabilities. With respect to taxes and withholdings covered in (i)
above, it is agreed that if the Borrower shall be required by law to
deduct any such taxes from or in respect of any sum payable by it
hereunder to any Bank or the Agent, (x) the sum payable shall be
increased as may be necessary so that, after making all required
deductions, such Bank or the Agent receives an amount equal to the sum
it would have received had no such deductions been made, (y) the
Borrower shall make such deductions, and (z) the Borrower shall pay
the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable law. Any Bank claiming amounts
under this Section 2.9(a) shall submit calculations of the amounts due
to the Borrower and the Agent in certificates in reasonable detail,
and such calculations, if reasonable and made in good faith, shall be
conclusive evidence thereof, absent manifest error. Such Bank may not
claim compensation under this Section 2.9(a) for any period of time
before 90 days prior to the delivery of any such certificate.
(b) Without limiting the effect of Section 2.9(a) hereof, in the event
that, by reason of any Regulatory Change, any Bank either (i) incurs
Additional Costs based on or measured by the excess above a specified
level of the amount of a category of deposits or other liabilities of
such Bank which includes deposits by reference to which the interest
rate on any LIBOR Rate Advances is determined as provided in this
Agreement or a category of extensions of credit or other assets of
such Bank which includes any LIBOR Rate Advances or (ii) becomes
subject to restrictions on the amount of such a category of
liabilities or assets which it may hold, then, if such Bank so elects
by notice to the Borrower, the obligation of such Bank to make LIBOR
Rate Advances hereunder shall be suspended until the date such
Regulatory Change ceases to be in effect, and all A Advances required
to be made by such Bank hereunder shall be made as Base Rate Advances.
Section 2.10 Capital Adequacy. If any Bank determines that the effect of
the imposition of or modification in any capital adequacy or similar
requirement (including a requirement which affects the Bank's allocation of
capital resources to its obligations) is to (a) directly or indirectly to
increase the cost to such Bank of making or maintaining amounts available
under this Agreement, (b) reduce the amount of any payment of principal or
interest receivable by such Bank, under this Agreement, or (c) reduce the
Bank's return under this Agreement or on all or any of its capital, and
such effect is due solely to its obligations hereunder and/or their
performance or such Bank is, in its sole opinion, unable to obtain the
Document #0021220 21<PAGE>
<PAGE>
rateof return on all or any of its capital that it would have been able to
achieve but for its obligations hereunder and/or their performance, then
the Borrower shall pay to such Bank such additional amounts as such Bank
may determine to be required to compensate such Bank on an after-tax basis
for such additional cost or reduction of amounts receivable. Any Bank
claiming amounts under Section 2.10 shall submit calculations of the
amounts due to the Borrower and the Agent in certificates in reasonable
detail, and such calculations, if reasonable and made in good faith, shall
be conclusive evidence thereof, absent manifest error. Such Bank may not
claim compensation under this Section 2.10 for any period of time before 90
days prior to the delivery of any such certificate.
Section 2.11 Certain Tax Regulations. Each Bank that is not incorporated
under the laws of the United States of America or a state thereof agrees
that it shall deliver to the Borrower and the Agent on the date of this
Agreement or upon the effectiveness of any Assignment under Section 8.6(e)
(a) two duly completed copies of United States Internal Revenue Service
Form 1001 or 4224 or successor applicable form, as the case may be,
certifying in each case that such Bank is entitled to receive payments
under the Credit Documents payable to it, without deduction or withholding
of any United States federal income taxes; (b) if applicable, an Internal
Revenue Service Form W-8 or W-9 or successor applicable form, as the case
may be, to establish an exemption from United State backup withholding tax;
and (c) any other governmental forms or other documents which are necessary
or required under an applicable tax treaty or otherwise by law to reduce or
eliminate any withholding tax, which have been reasonably requested by the
Borrower. Each Bank which delivers to the Borrower and the Agent a Form
1001 or 4224 and Form W-8 or W-9 pursuant to the next preceding sentence
further undertakes to deliver to the Borrower and the Agent two further
copies of the said Form 1001 or 4224 and Form W-8 or W-9, or successor
applicable forms, or other manner of certification, as the case may be, on
or before the date that any such form expires or becomes obsolete or after
the occurrence of any event requiring a change in the most recent form
previously delivered by it to the Borrower and the Agent, and such
extensions or renewals thereof as may reasonably be requested by the
Borrower and the Agent certifying, in the case of a Form 1001 or 4224, that
such Bank is entitled to receive payments under this Agreement without
deduction or withholding of any United States federal income taxes unless
an event (including without limitation any change in treaty, law or
regulation) has occurred prior to the date on which any such delivery would
otherwise be required which renders all such forms inapplicable or which
would prevent such Bank from duly completing and delivering any such form
with respect to it and such Bank advises the Borrower and the Agent that it
is not capable of receiving payments without any deduction or withholding
of United States federal income tax. The Borrower shall withhold tax at the
rate and in the manner required by the laws of the United States with
respect to payment made to a Bank failing to timely provide the requisite
Internal Revenue Service forms, with no penalty for increased costs to
Borrower.
Section 2.12 Illegality. Notwithstanding any other provision in this
Agreement, in the event that it becomes unlawful for any Bank or its
Applicable Lending Office to honor its obligation to make or maintain LIBOR
Rate Advances hereunder, such Bank's obligation to make LIBOR Rate Advances
shall be suspended until such time as such Bank may again make and maintain
LIBOR Rate Advances and the Borrower shall, upon the request of such Bank,
prepay any such LIBOR Rate Advances then outstanding hereunder together
with accrued interest thereon. So long as such condition remains in
Document #0021220 22<PAGE>
<PAGE>
effect, such Bank shall be under no obligation to make LIBOR Rate Advances
hereunder, and all A Advances required to be made by such Bank hereunder
shall be made as Base Rate Advances.
Section 2.13 Market Failure. Anything herein to the contrary
notwithstanding, if the Agent determines that: (a) quotations of interest
rates for the relevant deposits referred to in the definition of "LIBOR"
are not being provided in the relevant currencies, amounts, or maturities
for purposes of determining the rate of interest referred to in the
definition of "LIBOR" or (b) the relevant rates of interest referred to in
the definition of "LIBOR" which are used as the basis to determine the rate
of interest for LIBOR Rate Advances are not likely to adequately cover the
cost to the Banks of making or maintaining such LIBOR Rate Advances; then
the Agent shall give the Borrower prompt notice thereof and, so long as
such condition remains in effect, the Banks shall be under no obligation to
make LIBOR Rate Advances, and all A Advances required to be made by any
Bank hereunder shall be made as Base Rate Advances.
Section 2.14 Removal of Certain Banks. In the event that any Bank makes a
demand for payment under Section 2.4(b), 2.8, 2.9(a), or 2.10 or any Bank
has suspended its funding of LIBOR Rate Advances pursuant to Section
2.9(b), then with respect to such Bank, the Borrower may within 90 days of
such demand or the beginning of such suspension, if no Default then exists,
either:
(a) replace such Bank with another commercial bank selected by the
Borrower and approved by the Agent, which approval may not be
unreasonably withheld, and such Bank being replaced agrees to execute
an appropriate Assignment specifying the full transfer of all of such
Bank's rights and obligations hereunder, return all of its Notes, and
otherwise take such actions as necessary to comply with the provisions
of 8.6(d) such that the effect of the transfer under Section 8.6(e) is
to make the replacement bank a Bank hereunder with the same rights and
obligations as the Bank being replaced, provided that in connection
with such transfer all obligations of the Bank being replaced to lend
hereunder shall be terminated and the obligations of the Borrower to
pay principal, interest, and all other obligations owed to such Bank
hereunder shall be purchased by the replacement bank in full without
recourse at par and the Borrower will pay the Bank being replaced any
breakage costs pursuant to Section 2.8 as if such purchase were a
prepayment; or
(b) terminate such Bank as a Bank hereunder provided that (i) all
obligations of such Bank to lend hereunder shall be terminated and the
obligations of the Borrower to pay principal, interest, and all other
obligations owed to such Bank hereunder shall be paid in full and (ii)
such other actions shall be taken by the Borrower and such Bank as may
be appropriate to effect the termination of such Bank as a Bank
hereunder.
ARTICLE 3.
CONDITIONS
Section 3.1 Conditions to First Advances.
(a) The obligations of the Banks to make the first Advances under this
Agreement are subject to the condition precedent that the Agent shall
Document #0021220 23<PAGE>
<PAGE>
have received on or before the date hereof, in form and substance
satisfactory to the Agent and (except for the Notes and the Agent's
Fee Letter) in sufficient copies for each Bank:
(i) This Agreement, the Agent's Fee Letter, the A Notes and B
Notes , and the Guaranty made by Belden in favor of the Agent;
(ii) A favorable opinion of Mr. Kevin Bloomfield, General Counsel
for the Borrower;
(iii) A certificate of the Secretary or an Assistant Secretary of
the Borrower certifying the existence of the Borrower, a
certificate of good standing for the Borrower, the certificate of
incorporation of the Borrower, the bylaws of the Borrower, the
resolutions of the Board of Directors of the Borrower authorizing
this Agreement and related transactions, and the incumbency and
signatures of the officers of the Borrower authorized to execute
this Agreement and related documents;
(iv) A certificate of the Secretary or an Assistant Secretary of
Belden certifying the existence of Belden, a certificate of good
standing for Belden, the certificate of incorporation of Belden,
the bylaws of Belden, the resolutions of the Board of Directors
of Belden authorizing the Guaranty of Belden and related
transactions, and the incumbency and signatures of the officers
of Belden authorized to execute the Guaranty of Belden and
related documents; and
(v) Such other approvals, opinions, or documents which any Bank
through the Agent may reasonably request.
(b) The obligations of the Banks to make the first Advances under this
Agreement are subject to the further condition precedent that the
following shall be true on the date of such first Advances:
(i) There shall have been no material adverse change in the
financial condition or operations of the Borrower since December
31, 1995; and
(ii) The Borrower shall have made arrangements satisfactory to
the Agent that on or before November 18, 1996, in connection with
the making of the first Advances hereunder, the Borrower shall
repay any outstanding indebtedness under the Credit Agreement
dated as of August 5, 1994, with certain financial institutions
and in connection with such repayment shall terminate its credit
facilities under such Credit Agreement.
Section 3.2 A Borrowings. The obligation of each Bank to make an A Advance
on the occasion of any A Borrowing (including the initial A Borrowing)
shall be subject to the further conditions precedent that on the date of
such A Borrowing the following statements shall be true (and each of the
giving of the applicable Request for A Borrowing and the acceptance by the
Borrower of the proceeds of such A Borrowing shall constitute a
representation and warranty by the Borrower that on the date of such A
Borrowing such statements are true):
(a) the representations and warranties contained in Article 4 are
correct on and as of the date of such A Borrowing, before and after
Document #0021220 24<PAGE>
<PAGE>
giving effect to such A Borrowing, and to the application of the
proceeds therefrom, as though made on and as of such date,
(b) no event has occurred and is continuing, or would result from such
A Borrowing or from the application of the proceeds therefrom, which
constitutes a Default or an Event of Default, and
(c) following the making of such A Borrowing and all other Borrowings
to be made on the same day to the Borrower under this Agreement, the
aggregate outstanding Dollar Equivalent principal amount of Advances
shall not exceed the aggregate amount of the Commitments.
Section 3.3 B Borrowings. The obligation of each Bank to make any B Advance
as part of any B Borrowing is subject to the further conditions precedent
that (a) at or before the time required by paragraph (iii) of Section
2.2(b), the Agent shall have received the written confirmatory notice of
such B Borrowing contemplated by such paragraph; and (b) on the date of
such B Borrowing the following statements shall be true (and each of the
giving of the applicable Request for B Borrowing and the acceptance by the
Borrower of the proceeds of such B Borrowing shall constitute a
representation and warranty by the Borrower that on the date of such B
Borrowing such statements are true):
(i) the representations and warranties contained in Article 4 are
correct on and as of the date of such B Borrowing, before and
after giving effect to such B Borrowing, and to the application
of the proceeds therefrom, as though made on and as of such date,
(ii) no event has occurred and is continuing, or would result
from such B Borrowing or from the application of the proceeds
therefrom, which constitutes a Default or an Event of Default,
and
(iii) following the making of such B Borrowing and all other
Borrowings to be made on the same day to the Borrower under this
Agreement, the aggregate outstanding Dollar Equivalent principal
amount of Advances shall not exceed the aggregate amount of the
Commitments.
ARTICLE 4.
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants as follows:
Section 4.1 Corporate Existence and Power. The Borrower is a corporation
duly incorporated and validly existing under the laws of the State of
Delaware, is in good standing therein, is duly qualified to transact
business in all places where, in the opinion of the Borrower, such
qualification is necessary and material, and has corporate power to make
this Agreement and to borrow and perform its obligations hereunder. Each
Significant Subsidiary is in good standing in its respective jurisdiction
of incorporation and is duly qualified to transact business in all places
where, in the opinion of the Borrower, such qualification is necessary and
material.
Section 4.2 Corporate Authority. The making and performance by the Borrower
of this Agreement (a) have been duly authorized by all necessary corporate
Document #0021220 25 <PAGE>
<PAGE>
action; (b) shall not violate any provision of law or of its Certificate of
Incorporation or its bylaws; and (c) as of the date of this Agreement, do
not result in the breach of, or constitute a default under, or require any
consent under, any agreement presently in effect providing for or relating
to extensions of credit (including credit agreements, indentures,
guaranties, and other instruments), other than for goods and services
purchased in the ordinary course of business (which are not material in
amount), to which the Borrower or any of its Significant Subsidiaries or
any of their property may be bound or affected, except as previously
disclosed to the Agent and the Banks in writing
Section 4.3 Financial Condition. The financial statements of Belden Inc., a
Delaware corporation, with the opinion thereon of Ernst & Young, dated as
of December 31, 1995, heretofore furnished to the Agent and the Banks,
present fairly, in all material respects, the consolidated financial
condition of Belden Inc. as of the date of such financial statements, and
the consolidated results of operations and cash flows for fiscal year 1995,
in conformity with generally accepted accounting principles. The financial
statements of Belden Inc. dated as of June 30, 1996, heretofore furnished
to the Agent and the Banks, present fairly, in all material respects, the
consolidated financial condition of Belden Inc. as of the date of such
financial statements, and the consolidated results of operations and cash
flows for the first fiscal half of 1996, and include all adjustments,
consisting only of normal recurring adjustments, necessary for a fair
presentation of the financial information for the periods indicated. To the
best of the Borrower's knowledge and belief, neither the Borrower nor any
of its Subsidiaries had on December 31, 1995, any contingent liabilities,
liabilities for taxes, or unusual forward or long-term commitments which
are substantial in amount in relation to the consolidated financial
condition of the Borrower, except as referred to or reflected or provided
for in said consolidated financial statements as at that date.
Section 4.4 Litigation. There are no suits or proceedings pending, or to
the knowledge of the Borrower threatened, against or affecting the Borrower
or any of its Significant Subsidiaries which would, in the opinion of the
Borrower, if determined adversely to the Borrower or such Significant
Subsidiary, result in the occurrence of an Event of Default.
Section 4.5 Liens. The properties and assets of the Borrower and its
Significant Subsidiaries are not subject to any lien or encumbrance, other
than those permitted by Section 5.3.
Section 4.6 Use of Advances. Neither the Borrower nor any of its
Subsidiaries is engaged principally, or as one of its important activities,
in the business of extending credit for the purpose of purchasing or
carrying margin stock (within the meaning of Regulation U or X of the Board
of Governors of the Federal Reserve System) and no part of the proceeds of
any Advance hereunder shall be used to purchase or carry any margin stock.
Section 4.7 Taxes. The Borrower and each of its Significant Subsidiaries
have filed all tax returns which were required to be filed and paid all
taxes shown thereon to be due, including interest and penalties, or
provided adequate reserves for payment thereof.
Section 4.8 Subsidiaries. Schedule II contains a complete and correct list,
as of the date of this Agreement, of all Subsidiaries of the Borrower.
Except as disclosed in Schedule II, as of the date of this Agreement, the
Borrower and its Subsidiaries own, free and clear of all liens, charges,
Document #0021220 26<PAGE>
<PAGE>
encumbrances, and rights of others whatsoever, all the shares of the
Subsidiaries indicated in Schedule II as owned by the Borrower or such
Subsidiary, as the case may be, and all such shares are validly issued and
fully paid.
Section 4.9 Credit Agreement. Schedule III contains a complete and correct
list of all material credit agreements, indentures, purchase agreements,
guaranties, and other instruments in effect as of the date of this
Agreement providing for or relating to extensions of credit for a term of
more than one year in respect of which the Borrower or any of its
Subsidiaries is or may become directly or contingently obligated, and the
maximum principal or face amounts of the indebtedness in question,
outstanding or to be outstanding, are correctly stated in Schedule III.
Section 4.10 Titles, Etc. The Borrower and each of its Significant
Subsidiaries have good title to their respective properties and assets,
free and clear of all mortgages, liens, and encumbrances, except such as
are permitted by Section 5.3 and except covenants, restrictions, rights,
easements, and minor irregularities in title which do not interfere with
the occupation, use, and enjoyment by the Borrower or such Significant
Subsidiaries of such properties and assets in the normal course of business
as presently conducted or materially impair the value thereof for such
business.
Section 4.11 ERISA. The Borrower and each Significant Subsidiary have met
their minimum funding requirements under ERISA with respect to all of their
respective Plans and have not incurred any material liabilities to PBGC
under ERISA in connection with any such Plan.
Section 4.12 Validity, Etc. All acts necessary to make the Advances, when
made hereunder, the valid and binding obligations of the Borrower, and to
constitute this Agreement the valid and binding agreement of the Borrower
in accordance with its terms, have been done; this Agreement is a valid and
binding agreement of the Borrower enforceable in accordance with its terms;
and the Advances, when made hereunder, shall constitute valid and binding
obligations of the Borrower, enforceable in accordance with their terms.
Section 4.13 Environmental Matters. In the ordinary course of its business,
the Borrower conducts an ongoing review of the effect of Environmental Laws
on the business, operations, and properties of the Borrower and its
Subsidiaries, in the course of which it identifies and evaluates associated
liabilities and costs (including any capital or operating expenditures
required for clean-up or closure of properties presently or previously
owned, any capital or operating expenditures required to achieve or
maintain compliance with environmental protection standards imposed by law
or as a condition of any license, permit, or contract, any related
constraints on operating activities, including any periodic or permanent
shutdown of any facility or reduction in the level of or change in the
nature of operations conducted thereat, and any actual or potential
liabilities to third parties, including employees, and any related costs
and expenses). On the basis of this review, the Borrower has reasonably
concluded that the effect of Environmental Laws is unlikely to result in
the occurrence of an Event of Default.
<PAGE>
Document #0021220 27 <PAGE>
ARTICLE 5.
COVENANTS
So long as any amount of principal, interest, or fees under the Credit
Documents shall remain unpaid or any Bank shall have any Commitment
hereunder, unless the Majority Banks shall otherwise consent in writing:
Section 5.1 Financial Statements. The Borrower shall deliver to the Bank:
(a) As soon as available and in any event within 60 days after the end
of each of the first three fiscal quarters in each fiscal year,
consolidated statements of results of operations of Belden for the
period from the beginning of such fiscal year to the end of such
fiscal quarter, the related consolidated balance sheet of Belden as at
the end of such fiscal quarter, and the related consolidated
statements of cash flows, setting forth in comparative form the
corresponding figures for the corresponding period of the preceding
fiscal year, all in reasonable detail and accompanied by (i) a
certificate signed by an authorized financial officer of the Borrower
stating that said financial statements include all adjustments,
consisting only of normal recurring adjustments, necessary for a fair
presentation of the financial information for the periods indicated,
which certificate shall include a statement that such officer has no
knowledge, except as specifically stated, of any Default by the
Borrower in the observance of any of the provisions in this Agreement;
and (ii) a certificate signed by an authorized financial officer of
the Borrower in form and substance satisfactory to the Agent,
demonstrating compliance with the covenants contained below in this
Section 5.
(b) As soon as available and in any event within 120 days after the
end of each fiscal year, consolidated statements of results of
operations and reconciliation of capital accounts of Belden for such
year, and the related consolidated balance sheets of Belden and
consolidated statements of cash flows, setting forth in each case in
comparative form the corresponding figures for the preceding fiscal
year, all in reasonable detail and accompanied by (i) an unqualified
opinion of independent public accountants of recognized standing and
acceptable to the Agent together with a written statement of such
accountants to the effect that in making the audit necessary to such
opinion they have obtained no knowledge of any Default by the Borrower
in the fulfillment of any of the covenants contained in this Agreement
or if, in the opinion of such accountants any such Default exists,
specifying such Default and the nature thereof; (ii) a certificate
signed by an authorized financial officer of the Borrower stating that
said financial statements fairly present in accordance with generally
accepted accounting principles the financial condition and the results
of operation of Belden and its Subsidiaries at the end of such year
and for the year involved and that such officer has no knowledge,
except as specifically stated, of any Default by the Borrower in the
observance of any of the provisions in this Agreement; and (iii) a
certificate signed by an authorized financial officer of the Borrower,
in form and substance satisfactory to the Agent, demonstrating
compliance with the covenants contained below in this Section 5.
(c) Promptly upon a responsible financial officer of the Borrower
becoming aware of the existence of a condition, event, or act which
Document #0021220 28<PAGE>
<PAGE>
constitutes a Default or Event of Default, a written notice specifying
the nature and period of existence thereof and what action the
Borrower or its Subsidiary, as the case may be, is taking or proposes
to take with respect thereto.
(d) Promptly after their becoming available:
(i) Copies of all financial statements, reports, and proxy
statements which Belden or any of its Subsidiaries shall have
sent to its stockholders generally (other than the Borrower,
Belden Inc. or any Subsidiary of the Borrower or Belden Inc.).
(ii) Copies of all regular and periodic reports, if any, which
Belden or any of its Subsidiaries shall have filed with the
Securities and Exchange Commission.
(iii) From time to time, with reasonable promptness, such
additional information regarding the business, affairs, and
financial condition of the Borrower and its Subsidiaries as the
Agent or any Bank may reasonably request.
Section 5.2 Leverage Ratio. The Borrower and its Subsidiaries may incur,
create, assume, or suffer to exist any Debt provided that the Borrower
shall at no time permit the Leverage Ratio to exceed 65 percent .
Section 5.3 Liens. The Borrower shall not, nor shall it permit any of its
Significant Subsidiaries to, create or suffer to exist any mortgage,
pledge, security interest, conditional sale, or other title retention
agreement, lien, charge, or encumbrance upon any of its property or assets,
now owned or hereafter acquired, securing any indebtedness or obligation
(all such security being hereinafter called "liens"), except:
(a) Materialmen's, suppliers', tax, and other like liens arising in
the ordinary course of business securing obligations which are not
overdue or are being contested in good faith by appropriate
proceedings.
(b) Other liens incidental to the conduct of its business or the
ownership of its property and assets which were not incurred in
connection with the borrowing of money or the obtaining of advances or
credit, and which do not in the aggregate materially detract from the
value of its property or assets or materially impair the use thereof
in the operation of its business.
(c) Liens on property or assets of any corporation existing on the
date such corporation becomes a Subsidiary of the Borrower or such
property or assets become property or assets of the Borrower; provided
that such liens had not been created in anticipation of such
corporation becoming a Subsidiary of the Borrower or such property or
assets being acquired by the Borrower.
(d) Any lien renewing, extending, or refunding any lien permitted by
clause (c) immediately above; provided that the principal amount
secured is not increased and the lien is not extended to any other
property.
(e) The Borrower or any of its Significant Subsidiaries may create or
suffer to exist or renew, extend, or refund any interests existing in
Document #0021220 29<PAGE>
<PAGE>
favor of lessors under leases which secure Capitalized Lease
Obligations arising as an incident to the financing of new facilities
by means of pollution control or other industrial revenue bonds to be
issued by public authorities.
(f) Liens, not otherwise permitted by the foregoing provisions of this
Section 5.3, attached to property of the Borrower and its Significant
Subsidiaries provided that the outstanding principal amount of the
indebtedness so secured does not exceed five percent of Net Worth of
the Borrower at any time.
Section 5.4 Merger and Sale of Assets. The Borrower shall not, nor shall it
permit any of its Subsidiaries to, merge or consolidate with or into any
other Person, acquire by purchase or otherwise all or substantially all of
the stock or assets of any Person, or sell, lease, transfer, or otherwise
dispose of all or a substantial part of its assets, or any assets which
shall have contributed ten percent or more of consolidated Operating
Earnings of the Borrower for the fiscal year then most recently ended, to
any Person, provided that:
(a) Belden Wire & Cable Company may merge into Belden Inc. provided
that Belden Inc. has at the time of the merger no liabilities and no
material operations except those related to the ownership of Belden
Wire & Cable Company, the merger would not otherwise cause a Default
or Event of Default, and Belden Inc., if the successor entity, shall
execute any assumption agreements reasonably requested by the Agent to
confirm that Belden Inc. shall be bound by the terms of this Agreement
and the Credit Documents as successor to Belden Wire & Cable Company;
(b) Any Subsidiary of the Borrower may merge or consolidate with the
Borrower (provided that the Borrower shall be the successor
corporation unless the purpose of such merger or consolidation is to
effect a change in the State of incorporation of the Borrower) or with
any one or more other Subsidiaries of the Borrower;
(c) Any Subsidiary of the Borrower may sell, lease, dispose of, or
otherwise transfer any of its assets to the Borrower or another
Subsidiary of the Borrower and any Subsidiary of the Borrower that is
not a Significant Subsidiary may sell, lease, dispose of, or otherwise
transfer any of its assets to any Person for fair value; and
(d) Any corporation not a Subsidiary of the Borrower may be merged
into or consolidated with the Borrower or any of its Subsidiaries, or
the Borrower or any of its Subsidiaries may acquire all or
substantially all of the stock or assets of any Person provided that,
in the case of each such transaction, immediately thereafter and after
giving effect thereto:
(i) the Borrower shall be in compliance with this Agreement;
(ii) in the case of any merger into or consolidation with the
Borrower, the Borrower shall be the successor corporation; and
(iii) if the consideration payable by the Borrower or the
Subsidiaries of the Borrower in connection with any such
transaction shall consist, in whole or in part, of shares of
stock of the Borrower (except for liabilities to dissenting
shareholders), the total number of shares of stock of the
Document #0021220 30<PAGE>
<PAGE>
Borrower having ordinary voting power for the election of
directors issued or exchanged in connection with, or added to
those outstanding as a result of, such transaction shall not
exceed 40 percent of the total of such voting shares of the
Borrower outstanding immediately prior to such transaction.
Section 5.5 Subsidiary Guaranties. The Borrower shall cause each of its
Subsidiaries to execute a guaranty in substantially the form of Exhibit D
with such changes as the Agent may reasonably request or such other form of
guaranty reasonably requested by the Agent which is required to have the
same effect with respect to guaranties executed by Subsidiaries organized
under a jurisdiction outside of the United States; provided that the
Borrower may exempt any of its Subsidiaries organized under a jurisdiction
outside of the United States and any of its Subsidiaries which are not
Significant Subsidiaries from this requirement so long as (a) the aggregate
assets of such Subsidiaries which have not executed Guaranties does not
exceed 35 percent of the consolidated assets of the Borrower and (b) the
aggregate net income before taxes of such Subsidiaries which have not
executed Guaranties for the most recent 12 months then ended does not
exceed 35 percent of the consolidated net income before taxes of the
Borrower for the most recent 12 months then ended. Provided that no Default
or Event of Default shall exist, at the request of the Borrower the Agent
shall release any Guaranty from any Subsidiary which the Borrower could at
the time of the Borrower's request elect to exempt from the execution of
such Guaranty under the proviso in the preceding sentence.
Section 5.6 Taxes. The Borrower shall, and shall cause each of its
Significant Subsidiaries to, pay and discharge all taxes, assessments, and
governmental charges or levies imposed on it or on its income or profits or
on any of its property prior to the date on which penalties attach thereto,
except that no corporation shall be required hereby to pay any such tax,
assessment, charge, or levy, the payment of which is being contested in
good faith and by proper proceedings.
Section 5.7 Sale-and-Leaseback. The Borrower shall not, nor shall it permit
any of its Significant Subsidiaries to, sell or transfer to a Person (other
than the Borrower or a Subsidiary of the Borrower) any property, whether
now owned or hereafter acquired, if at the time or thereafter the Borrower
or a Subsidiary of the Borrower shall lease as lessee such property or any
part thereof or other property which the Borrower or a Subsidiary of the
Borrower intends to use for substantially the same purpose as the property
sold or transferred except such transactions:
(a) Incident to transactions permitted by 5.3(e).
(b) From which arise Capital Lease Obligations and other rental
obligations not exceeding five percent of Net Worth in the aggregate
at any one time.
Section 5.8 Net Worth. The Borrower shall at no time permit the
consolidated Net Worth of Belden to be less than the sum of (a) 80% of
Belden's consolidated Net Worth as of June 30, 1996 and (b) 50 percent of
an amount equal to the cumulative consolidated quarterly net income of
Belden, determined in accordance with generally accepted accounting
principles, beginning with the quarter ending September 30, 1996, through
the end of Belden's most recently ended fiscal quarter, but excluding
consolidated net income for any fiscal quarter in which consolidated net
income is not a positive number.
Document #0021220 31<PAGE>
<PAGE>
Section 5.9 Maintenance of Property; Insurance. The Borrower shall keep,
and shall cause each Significant Subsidiary to keep, all property useful
and necessary in its business in good working order and condition, ordinary
wear and tear excepted; shall maintain, and shall cause each Significant
Subsidiary to maintain (either in the name of the Borrower or in such
Significant Subsidiary's own name) either with financially sound and
reputable insurance companies or pursuant to a plan of self-insurance
established in accordance with sound and appropriate practices, insurance
on all their property in at least such amounts and against at least such
risks as are usually insured against in the same general area by companies
of established repute engaged in the same or a similar business.
Section 5.10 Compliance with Laws. The Borrower shall, and shall cause each
of its Significant Subsidiaries to, comply, in all material respects with
all federal, state, and local laws and regulations which are applicable to
the operations and property of the Borrower and its Significant
Subsidiaries, including laws related to taxation, ERISA, and environmental
laws, unless noncompliance with such laws and regulations would not have a
material adverse effect on the consolidated financial condition of the
Borrower and provided that this Section shall not prevent the Borrower or
any such Significant Subsidiary from, in good faith and with reasonable
diligence, contesting the validity or application of any such laws or
regulations by appropriate legal proceedings for which adequate reserves
have been established in accordance with generally accepted accounting
principles.
ARTICLE 6.
EVENTS OF DEFAULT
If any of the following events ("Events of Default") shall occur and be
continuing:
(a) The Borrower shall fail to pay when due any principal, interest,
or fees due under the Credit Documents;
(b) Any representation or warranty made or deemed made in the Credit
Documents by the Borrower or any Guarantor, or any certificate
furnished to the Agent or any Bank under the Credit Documents, shall
prove to have been incorrect in any material respect;
(c) The Borrower shall fail to perform (i) any agreement contained in
Sections 5.3, 5.4, or 5.7 of this Agreement or (ii) any agreement
contained in Section 5 (other than agreements in Sections 5.1(a), (b),
and (d), Section 5.6 and Section 5.9) or Section 6(f) hereof which
shall remain unremedied for 10 days after the Borrower shall have had
knowledge of the occurrence thereof;
(d) The Borrower shall fail to perform any other agreement herein
which shall remain unremedied for 30 days after written notice thereof
shall have been given by the Agent to the Borrower;
(e) Any Guaranty shall at any time (before its expiration according to
its terms) or for any reason cease to be in full force and effect or
shall be contested by any party thereto, or any party thereto shall
deny it has any further liability or obligation thereunder, or any
provision of any Guaranty shall be breached by any party thereto
(provided that if any Guaranty shall cease to be in full force and
Document #0021220 32<PAGE>
<PAGE>
effect due to changes in law, then such failure shall not create an
Event of Default unless such failure shall remain unremedied for 30
days after written notice thereof shall have been given by the Agent
to the Borrower);
(f) Any payment on any bond, debenture, note, or other evidence of
indebtedness of the Borrower, any of its Subsidiaries, or any
Guarantor, exceeding in aggregate five percent of the consolidated
Net Worth of Belden as of the date of the most recent financial
statement received by the Agent pursuant to Section 5.1, shall become
due whether by maturity, acceleration, or otherwise and shall not be
promptly paid; or if there shall occur any default or event of
default, however denominated, under any cross default provision in any
such debt instrument described above (and the Borrower agrees to
promptly provide the Agent with copies of such cross default
provisions and, at the request of the Agent or any Bank, the Borrower
agrees to amend this Agreement to include any such cross default
provision in this Agreement);
(g) Any of the Borrower, its Subsidiaries, or any Guarantor shall (i)
apply for or consent to the appointment of a receiver, trustee, or
liquidator of itself or of its property, (ii) be unable, or admit in
writing inability, to pay its debts as they mature, (iii) make a
general assignment for the benefit of creditors, (iv) be adjudicated a
bankrupt or insolvent, or (v) file a voluntary petition in bankruptcy
or a petition or answer seeking reorganization or an arrangement with
creditors or to take advantage of any insolvency law or an answer
admitting the material allegations of a petition filed against it in
any bankruptcy, reorganization, or insolvency proceeding, or corporate
action shall be taken by it for the purpose of effecting any of the
foregoing;
(h) An order, judgment, or decree shall be entered, without the
application, approval, or consent of the Borrower, any of its
Subsidiaries, or any Guarantor, respectively, by any court or
governmental agency of competent jurisdiction, approving a petition
seeking reorganization of any such Person, or appointing a receiver,
trustee, liquidator, intervenor, or the like for any such Person, or
of all or a substantial part of any such Person's assets, and such
order, judgment, or decree, if being contested in good faith and by
appropriate proceedings, shall continue unstayed and in effect for any
period of 30 consecutive days;
(i) Any Termination Event shall have occurred and shall have continued
under circumstances which may result in an uninsured payment or
repayment liability of the Borrower, any of its Subsidiaries, or any
Guarantor to the PBGC in an amount which is material in relation to
the financial position of the Borrower; or
(j) The occurrence of any Change in Control of Belden, or Belden Inc.
shall at any time and for any reason cease to own 100 percent of the
issued and outstanding common stock of the Borrower (except pursuant
to a merger of Belden Inc. into Belden Wire & Cable Company pursuant
to Section 5.4(a));
then, and in any such event, the Agent (i) may, or shall at the request of
the Majority Banks, by notice to the Borrower, declare all of the
Commitments and the obligation of each Bank to make Advances to be
Document #0021220 33<PAGE>
<PAGE>
terminated, whereupon all of the Commitments and each such obligation shall
forthwith terminate, and (ii) may, or shall at the request of the Majority
Banks, by notice to the Borrower declare the aggregate outstanding
principal amount of all Advances, all interest thereon, and all other
amounts payable by the Borrower under the Credit Documents to be forthwith
due and payable, whereupon such principal, interest, and other amounts
shall become and be forthwith due and payable, without requirement of any
presentment, demand, protest, notice of intent to accelerate, further
notice of acceleration, or other further notice of any kind (other than the
notice expressly provided for above), all of which are hereby expressly
waived by the Borrower; provided, however, that in the event of any Event
of Default described in paragraphs (g) or (h), the obligation of each Bank
to make Advances shall automatically be terminated and such principal,
interest, and other amounts shall automatically become and be due and
payable, without presentment, demand, protest, notice of intent to
accelerate, notice of acceleration, or any other notice of any kind, all of
which are hereby expressly waived by the Borrower.
ARTICLE 7.
THE AGENT
Section 7.1 Authorization and Action. Each Bank hereby appoints and
authorizes the Agent to take such action as agent on its behalf and
toexercise such powers under the Credit Documents as are delegated to the
Agent by the terms hereof and thereof, together with such powers as are
reasonably incidental thereto. As to any matters not expressly provided for
by the Credit Documents (including enforcement or collection of the
Advances), the Agent shall not be required to exercise any discretion or
take any action, but shall be required to act or to refrain from acting
(and shall be fully protected in so acting or refraining from acting) upon
the instructions of the Majority Banks, and such instructions shall be
binding upon all Banks and all holders of any interests under the Banks;
provided, however, that the Agent shall not be required to take any action
which exposes the Agent to personal liability or which is contrary to any
Credit Document or applicable law, nor shall the Agent have or be deemed to
have any fiduciary relationship with any Bank. The Agent agrees to give to
each Bank prompt notice of each material notice given to it by the Borrower
pursuant to the terms of this Agreement. The Agent may execute any of its
duties under this Agreement or any other Loan Document by or through
agents, employees or attorneys-in-fact and shall be entitled to advice of
counsel concerning all matters pertaining to such duties. The Agent shall
not be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects with reasonable care.
Section 7.2 Agent's Reliance, Etc. Neither the Agent nor any of its
directors, officers, agents, or employees shall be liable for any action
taken or omitted to be taken by it or them under or in connection with the
Credit Documents, INCLUDING ACTIONS WHICH ARE NEGLIGENT, except for its or
their own gross negligence or willful misconduct. Without limitation of the
generality of the foregoing, the Agent: (a) may treat each Bank of record
as the holder of its interests under the Credit Documents unless the Agent
has received an Assignment pursuant to Section 8.6(d); (b) may consult with
legal counsel (including counsel for the Borrower), independent public
accountants, and other experts selected by it and shall not be liable for
any action taken or omitted to be taken in good faith by it in accordance
Document #0021220 34<PAGE>
<PAGE>
with the advice of such counsel, accountants, or experts; (c) makes no
warranty or representation to any Bank and shall not be responsible to any
Bank for any statements, warranties, or representations made in or in
connection with the Credit Documents; (d) shall not have any duty to
ascertain or to inquire as to the performance or observance of any of the
terms, covenants, or conditions of the Credit Documents on the part of the
Borrower to inspect the property (including the books and records) of the
Borrower; (e) shall not be responsible to any Bank for the due execution,
legality, validity, enforceability, genuineness, sufficiency, or value of
the Credit Documents; and (f) shall incur no liability under or in respect
of the Credit Documents by acting upon any notice, consent, certificate, or
other instrument or writing (which may be by telecopier, telegram, cable,
or telex) believed by it to be genuine and signed or sent by the proper
party or parties. The Agent shall be fully justified in failing or
refusing to take any action under this Agreement or any other Credit
Document unless it shall first receive such advice or concurrence of the
Majority Banks as it deems appropriate and, if it so requests, it shall
first be indemnified to its satisfaction by the Majority Banks against any
and all liability and expense which may be incurred by it by reason of
taking or continuing to take any such action. The Agent shall in all cases
be fully protected in acting, or in refraining from acting, under this
Agreement or any other Loan Document in accordance with a request or
consent of the Majority Banks and such request and any action taken or
failure to act pursuant thereto shall be binding upon all of the Banks.
Section 7.3 The Agent and Affiliates. With respect to its Commitment and
the Advances made by it, the Agent shall have the same rights and powers
under the Credit Documents as any other Bank and may exercise the same as
though it was not the Agent; and the term "Bank" or "Banks" shall, unless
otherwise expressly indicated, include the Agent in its individual
capacity. The Agent and its affiliates may accept deposits from, lend money
to, act as trustee under indentures of, and generally engage in any kind of
business with the Borrower, any Subsidiary of the Borrower, and any Person
who may do business with or own securities of the Borrower or any such
Subsidiary, all as if the Agent were not the Agent and without any duty to
account therefor to the Banks.
Section 7.4 Bank Credit Decision. Each Bank represents to the Agent that it
has, independently and without reliance upon the Agent or any other Bank
and based on the financial statements referred to in Section 4.3 and such
other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement. Each Bank also
acknowledges that it will, independently and without reliance upon the
Agent or any other Bank, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under the Credit Documents.
Section 7.5 Indemnification. The Banks agree to indemnify the Agent (to the
extent not reimbursed by the Borrower), ratably according to the respective
outstanding principal amounts of the A Advances made by each of them (or if
no A Advances are at the time outstanding or are held by Persons which are
not Banks, ratably according to either (a) the respective amounts of their
Commitments, or (b) if all Commitments have terminated, the respective
amounts of the Commitments immediately prior to the time the Commitments
terminated), from and against any and all losses, liabilities, claims,
damages, or expenses of any kind or nature whatsoever which may be imposed
on, incurred by, or asserted against the Agent in any way relating to or
arising out of the Credit Documents or any action taken or omitted by the
Document #0021220 35<PAGE>
<PAGE>
Agent under the Credit Documents, INCLUDING ACTIONS OR OMISSIONS WHICH
REPRESENT THE AGENT'S OWN NEGLIGENCE; provided that no Bank shall be liable
to the Agent for any portion of such losses, liabilities, claims, damages,
or expenses resulting from the Agent's gross negligence or willful
misconduct. Without limitation of the foregoing, each Bank agrees to
reimburse the Agent promptly upon demand for its ratable share of any
out-of-pocket expenses (including Attorney Costs) incurred by the Agent in
connection with the preparation, execution, delivery, administration,
modification, amendment, or enforcement (whether through negotiations,
legal proceedings, or otherwise) of, or legal advice in respect of rights
or responsibilities under, the Credit Documents to the extent that the
Agent is not reimbursed for such expenses by the Borrower. The undertaking
in this Section shall survive the payment of all obligations hereunder and
the resignation or replacement of the Agent.
Section 7.6 Successor Agent. The Agent may be removed by the Borrower at
any time upon 90 days' advance notice to that effect from the Borrower,
provided that there shall exist no Default or Event of Default at any time
during the period from such notice to the date of the transfer, one of the
Banks has agreed to become the successor Agent hereunder, and such
successor Agent shall hold 10% or more of the Commitments hereunder. The
Agent may resign at any time as Agent hereunder by giving notice thereof to
the Banks and the Borrower. The Agent may be removed by the Majority Banks
at any time upon 60 days' advance notice to that effect from the Majority
Banks. Following the resignation of the Agent or the removal of the Agent
by the Majority Banks, (i) if there shall exist no Default or Event of
Default, the Borrower may appoint one of the Banks as Agent hereunder or
(ii) if there shall exist any Default or Event of Default hereunder, or if
the Borrower does not appoint a successor Agent under the preceding clause,
the Majority Banks may appoint any Bank to become the successor Agent
hereunder. If no successor Agent shall have been so appointed by the
Borrower or the Majority Banks and shall have accepted such appointment
within 30 days after the retiring Agent's giving of notice of resignation
or the Majority Banks' removal of the retiring Agent, then the retiring
Agent may, on behalf of the Banks, appoint a successor Agent, which shall
be a Bank which is a commercial bank having a combined capital and surplus
of at least $500,000,000. If no successor agent has accepted appointment
as Agent by the date which is 30 days following a retiring Agent's notice
of resignation, the retiring Agent's resignation shall nevertheless
thereupon become effective and the Banks shall perform all of the duties of
the Agent hereunder until such time, if any, as the Majority Banks appoint
a successor agent as provided for above. Upon the acceptance of any
appointment as Agent under this Agreement by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges, and duties of the retiring Agent and shall
function as the Agent under this Agreement, and the retiring Agent shall be
discharged from its duties and obligations as Agent under this Agreement.
After any retiring Agent's resignation or removal hereunder as Agent, the
provisions of this Article 7 shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Agent under this Agreement.
ARTICLE 8.
MISCELLANEOUS
Section 8.1 Amendments, Etc. No amendment or waiver of any provision of any
Credit Document, nor consent to any departure by the Borrower therefrom,
shall in any event be effective unless the same shall be in writing and
Document #0021220 36<PAGE>
<PAGE>
signed by the Borrower and the Majority Banks, and then such waiver or
consent shall be effective only in the specific instance and for the
specific purpose for which given; provided, however, that no amendment,
waiver, or consent shall, unless in writing and signed by all the Banks, do
any of the following: (a) increase the Commitments of any Bank or subject
any Bank to any additional obligations, (b) reduce the principal of, or
interest on, the Advances or any fees or other amounts payable hereunder,
(c) postpone any date fixed for any payment of principal of, or interest
on, the Advances or any fees or other amounts payable hereunder, (d) take
action which requires the signing of all the Banks pursuant to the terms of
this Agreement, (e) change the definition of "Majority Banks" or otherwise
change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Advances, or the number of Banks, which shall be
required for the Banks or any of them to take any action under this
Agreement or any other Credit Document, (f) amend this Section 8.1, or (g)
impair any indemnification received by any Bank under this Agreement or any
other Credit Document; provided, further, that no amendment, waiver, or
consent shall, unless in writing and signed by the Agent in addition to the
Banks required above to take such action, affect the rights or duties of
the Agent under any Credit Document.
Section 8.2 Notices, Etc. All notices and other communications provided for
hereunder shall be in writing (including telecopy or telex communication)
and mailed, delivered, telecopied, or telexed to the addresses specified on
Schedule I hereto or specified in an Assignment pursuant to Section 8.6(d)
or to such other address as shall be designated by such party in a written
notice to the other parties hereto. Mailed or delivered notice shall be
effective when received, telecopied notice shall be effective when sent by
telecopier and confirmed, and telexed notice shall be effective when
telexed and confirmed by telex answerback, respectively, except that
notices and communications to the Agent pursuant to Article 2 or 8 shall
not be effective until received by the Agent.
Section 8.3 No Waiver; Remedies. No failure on the part of any Bank or the
Agent to exercise, and no delay in exercising, any right under any Credit
Document shall operate as a waiver thereof; nor shall any single or partial
exercise of any such right preclude any other or further exercise thereof
or the exercise of any other right. The remedies provided in the Credit
Documents are cumulative and not exclusive of any remedies provided by law.
Section 8.4 Costs, Expenses, and Taxes.
(a) The Borrower agrees to pay on demand (i) all reasonable costs and
expenses of the Agent in connection with the creation, modification,
and amendment of any Credit Document, including reasonable Attorney
Costs with respect thereto; and (ii) all costs and expenses, if any
(including Attorney Costs), of the Agent and each Bank in connection
with the enforcement (whether through negotiations, legal proceedings,
or otherwise) against the Borrower of any Credit Document.
(b) The Borrower agrees to indemnify the Agent and each Bank and their
respective officers, directors, employees, and agents from, and hold
each of them harmless against, any and all losses, liabilities,
claims, damages, or expenses (including reasonable Attorney Costs)
incurred by, imposed upon, or asserted against any of them arising out
of or by reason of any actual or threatened litigation or other
proceeding relating to the making or performance by the Borrower of
this Agreement and the Credit Documents, any actual or proposed use by
Document #0021220 37<PAGE>
<PAGE>
the Borrower of the proceeds of any of the Advances, and any actions
of the Agent or the Banks or such Persons related to the enforcement
of the rights of the Agent and the Banks under this Agreement and the
other Credit Documents, INCLUDING ACTIONS WHICH CONSTITUTE THE
NEGLIGENCE OF THE AGENT OR THE BANKS, but excluding any such losses,
liabilities, claims, damages, or expenses incurred by reason of the
gross negligence or willful misconduct of the Person or entity to be
indemnified. The obligations of the Borrower under this Section 8.4(b)
shall survive the termination of this Agreement.
(c) After any retiring Agent's resignation or removal hereunder as
Agent and after any Bank ceases to be a Bank hereunder, the provisions
of Section 8.4(a) and 8.4(b) shall continue to inure to such Agent's
and such Bank's benefit as to any actions taken or omitted to be taken
while such Agent or such Bank was Agent or a Bank under this
Agreement.
Section 8.5 Right of Set-off. Upon (a) the occurrence and during the
continuance of any Event of Default and (b) the delivery of any notice
required under Article 6 to authorize the Agent to declare the Advances due
and payable pursuant to the provisions of Article 6, the Agent and each
Bank is hereby authorized at any time and from time to time, to the fullest
extent permitted by law, to set off and apply any and all deposits (general
or special, time or demand, provisional or final) at any time held and
other indebtedness at any time owing by the Agent or such Bank to or for
the credit or the account of the Borrower against any and all of the
obligations of the Borrower now or hereafter existing under the Credit
Documents, irrespective of whether or not such Bank shall have made any
demand under the Credit Documents and although such obligations may be
unmatured. The Agent and each Bank, respectively, agrees promptly to notify
the Borrower after such set-off and application made by the Agent or such
Bank, provided that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of the Agent and each
Bank under this Section are in addition to other rights and remedies
(including other rights of set-off) which the Agent or any such Bank may
have.
Section 8.6 Assignments and Participations. Except as specified in this
Section 8.6, no Bank may assign and delegate its rights and obligations
under this Agreement or any other Credit Document.
(a) Assignment by Right. Any Bank may (i) assign, as collateral or
otherwise, all or any portion of its rights (including all or a
portion of the Advances owing to it) under this Agreement and the
Credit Documents to any Federal Reserve Bank without notice to or the
consent of the Borrower or the Agent; (ii) assign all or any portion
of its rights to any Advances to any Affiliate of such assignor Bank,
but without releasing the obligations of the assignor Bank hereunder;
and (iii) upon written notice to the Borrower and the Agent, on the
terms of and in accordance with the procedures specified in paragraph
(d) below, assign and delegate all or any portion of its rights and
obligations under this Agreement and the Credit Documents (including
the Advances owing to it and its Commitment hereunder) to any
Affiliate of such Bank, provided that (A) such Affiliate or the
financial institution or holding company directly or indirectly owning
such Affiliate has at the time of such assignment a rating on its
unsecured long-term debt at least equal to A from Standard & Poor's
Corporation or at least equal to A2 from Moody's Investors Services
Document #0021220 38<PAGE>
<PAGE>
and (B) such Affiliate has retained capital and surplus of at least
$500,000,000. Notwithstanding anything to the contrary in this
Agreement, if any Bank makes an assignment under this paragraph (a),
the Borrower shall not be obliged to pay any greater amount to such
assignee under this Agreement and the Credit Documents than it would
have been obliged to pay had there been no such assignment.
(b) Assignment by Approval. Upon the approval of the Borrower, in the
Borrower's sole discretion, and the approval of the Agent, which
approval may not be unreasonably withheld, any Bank may on the terms
of and in accordance with the procedures specified in paragraph (d)
below assign to one or more financial institutions all or any portion
of its rights and obligations under this Agreement (including the
Advances owing to it and its Commitment).
(c) The Register. The Agent shall maintain at its address referred to
on Schedule I a copy of each Assignment delivered to and accepted by
it and a register for the recordation of the names and addresses of
the Banks and the Commitments of, and principal amount of the Advances
owing to, each Bank from time to time (the "Register"). The entries in
the Register shall be conclusive and binding for all purposes, absent
manifest error, and the Borrower, the Agent, and the Banks may treat
each Person whose name is recorded in the Register as a Bank hereunder
for all purposes of this Agreement. The Register shall be available
Document #0021220 39 <PAGE>
<PAGE>
for inspection by the Borrower or any Bank at any reasonable time and
from time to time upon reasonable prior notice.
(d) Terms and Procedures for Assignments. Any assignments made
pursuant to paragraph (a)(iii) or (b) above must meet the following
requirements: (i) each delegation of an assignor Bank's Commitment
shall be of a constant, and not a varying, percentage of all of such
assignor Bank's obligations under this Agreement in respect of such
Commitment; (ii) the amount of the resulting Commitment and Advances
of the assignor Bank (unless it is assigning all its Commitment) and
the assignee Bank pursuant to each such assignment (determined as of
the date of the Assignment with respect to such assignment) shall in
no event be less than $10,000,000 and shall be an integral multiple of
$1,000,000; (iii) the parties to each such assignment shall execute
and deliver to the Agent, for its acceptance and recording in the
Register, an Assignment, together with any Note or Notes subject to
such assignment; and (iv) each assignee not already a Bank hereunder
shall pay to the Agent an assignment fee of $2,500 in connection with
such assignment. Upon receipt of an Assignment executed by an assignor
Bank and an assignee, together with any Note or Notes subject to such
assignment, the Agent shall, if such Assignment has been completed and
is in substantially the form of the attached Exhibit E, and if such
Assignment has been approved pursuant to paragraph (a)(iii) or (b)
above, accept such Assignment, record the information contained
therein in the Register, and give prompt notice thereof to the
Borrower. Within five Business Days after its receipt of such notice,
the Borrower, at its own expense, shall execute and deliver to the
Agent (x) in exchange for any surrendered A Note and at the request of
the assignee, a new A Note to the order of the assignee in an amount
equal to the Commitment assumed by it pursuant to such Assignment and,
if the assignor has retained any Commitment hereunder, at the request
of the assignor, a new A Note to the order of the assignor in an
amount equal to the Commitment retained by it hereunder, and (y) in
exchange for any surrendered B Note, and at the request of the
assignee, a new B Note to the order of such assignee and, if the
assignor has retained any B Advances hereunder, at the request of the
assignor, a new B Note to the order of such assignor in the amount
equal to the B Advances under such surrendered B Note retained by it
hereunder. Such new A Notes and B Notes shall be dated the effective
date of such Assignment and shall otherwise be in substantially the
form of Exhibit A-1 or Exhibit A-2, as the case may be.
(e) Effect of Assignments. By executing and delivering an Assignment
in accordance with paragraph (d) above, the assignor and the assignee
thereunder confirm to and agree with the Borrower, the Agent, and the
other parties hereto the matters set forth therein. Upon the
execution, delivery, acceptance, and recording of the Assignment with
the Agent, from and after the effective date specified in each
Assignment, which effective date shall be at least three Business Days
after the execution thereof, (i) the assignee thereunder shall be a
party hereto for all purposes and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such
Assignment, have the rights and obligations of a Bank hereunder and
(ii) the assignor thereunder shall, to the extent that rights and
obligations hereunder have been assigned by it pursuant to such
Assignment, relinquish its rights and be released from its obligations
under this Agreement (and, in the case of an Assignment covering all
or the remaining portion of the assignor's rights and obligations
Document #0021220 40<PAGE>
<PAGE>
under this Agreement, the assignor shall cease to be a party hereto).
(f) Participations. Any Bank may sell participations in all or any
portion of its rights and obligations under this Agreement and the
Credit Documents (including the Advances owing to it and its
Commitment hereunder) to another financial institution, but no
participant shall have any rights under this Agreement (the
participant's rights against such Bank in respect of such
participation to be those set forth in the agreement executed between
such Bank and the participant relating thereto) and all amounts
payable by the Borrower under this Agreement and the Credit Documents
shall be determined as if such Bank had not sold such participation.
The Agent or any Bank may furnish to participants and prospective
participants copies of this Agreement, the Notes, any Guaranties,
other Credit Documents, other information described in Section 3.1,
any amendments, supplements, modifications, and waivers relating to
the Credit Documents, and any other documents or information expressly
required by this Agreement to be furnished to the Agent or any Bank
under this Agreement.
Section 8.7 Governing Law. This Agreement and the other Credit Documents
shall be governed by, and construed in accordance with, the laws of the
State of Illinois.
Section 8.8 Execution in Counterparts. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement.
Section 8.9 Survival of Agreements. All warranties, representations, and
covenants made by the Borrower or any officer of the Borrower herein, or in
any certificate or other document delivered in connection with this
Agreement, shall be considered to have been relied upon by the Banks and
shall survive the issuance and delivery of any notes and the making of the
Advances regardless of any investigation. The indemnities and other
obligations of the Borrower contained in this Agreement, and the
indemnities by the Banks in favor of the Agent and its officers, directors,
employees, and agents, shall survive the repayment of the Advances and the
termination of this Agreement.
Section 8.10 Borrower's Right to Apply Deposits. In the event that any Bank
is placed in receivership or enters a similar proceeding, the Borrower may,
to the full extent permitted by law, make any payment due to such Bank
hereunder, to the extent of finally collected unrestricted deposits of the
Borrower in Dollars held by such Bank, by giving notice to the Agent and
such Bank directing such Bank to apply such deposits to such indebtedness.
If the amount of such deposits is insufficient to pay such indebtedness
then due and owing in full, the Borrower shall pay the balance of such
insufficiency in accordance with this Agreement.
Section 8.11 Binding Effect. This Agreement shall become effective when it
shall have been executed by the Borrower and the Agent, and when each Bank
listed on the signature pages hereof has delivered an executed counterpart
hereof to the Agent, has sent to the Agent a facsimile copy of its
signature hereon, or has notified the Agent that such Bank has executed
this Agreement and thereafter shall be binding upon and inure to thebenefit
of the Borrower, the Agent, each Bank, and its respective successors and
Document #0021220 41<PAGE>
<PAGE>
assigns, except that the Borrower shall not have the right to assign any of
its respective rights hereunder or any interest herein without the prior
written consent of the Banks.
Section 8.12 WAIVER OF JURY TRIAL. THE BORROWER, THE AGENT, AND THE BANKS
IRREVOCABLY WAIVE RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING
OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
Section 8.13 ENTIRE AGREEMENT. THIS WRITTEN AGREEMENT AND THE CREDIT
DOCUMENTS, AS DEFINED IN THIS AGREEMENT, REPRESENT THE FINAL AGREEMENT
AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the
date first above written.
BORROWER:
BELDEN WIRE & CABLE COMPANY
By: /s/ Richard K. Reece
Title: Treasurer
COMMITMENTS BANKS
AGENT:
$35,000,000 BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION
By: /s/ Mike Healy
Title: Vice President
CO-AGENT:
$25,000,000 NATIONSBANK, N.A.
By: /s/ Valerie C. Mills
Title: Sr. Vice President
Document #0021220 42<PAGE>
<PAGE>
COMMITMENTS BANKS
$35,000,000 WACHOVIA BANK OF GEORGIA, N.A.
By: /s/ Volney Hill
Title: Vice President
$30,000,000 ABN AMRO Bank N.V., Chicago Branch
By: ABN AMRO North America, Inc., as
agent
By: /s/ John L. Church
Title: Vice President and Director
By: /s/ David H. Hannah
Title: Group Vice President
$30,000,000 ROYAL BANK OF CANADA
By: /s/ Ray Chang
Title: Vice President
$20,000,000 THE NORTHERN TRUST COMPANY
By: /s/ Daniel R. Hintzen
Title: Vice President
Document #0021220 43<PAGE>
<PAGE>
COMMITMENTS BANKS
$15,000,000 COMMERZBANK AKTIENGESELLSCHAFT,
Chicago BRANCH
By: /s/ Mark Monson
Title: Vice President
By: /s/ Dr. Helmut R. Tollner
Title: Executive Vice President
$10,000,000 THE BOATMEN'S NATIONAL BANK
OF ST. LOUIS
By: /s/ Emil A. Krueger
Title: Vice President
<PAGE>
Document #0021220 44<PAGE>
<PAGE>
Exhibit A-1
A PROMISSORY NOTE
U.S. $[__________________] [date_____________]
For value received, the undersigned, BELDEN WIRE & CABLE COMPANY, a
Delaware corporation (the "Borrower"), hereby promises to pay to the order
of [___________________________] (the "Bank"), for the account of its
Applicable Lending Office (as defined in the Credit Agreement referred to
below, the defined terms of which are used herein unless otherwise defined
herein), the principal amount of each A Advance made by the Bank to the
Borrower pursuant to the Credit Agreement at such times as are specified in
the Credit Agreement.
The Borrower promises to pay interest on the unpaid principal amount
of each A Advance from the date of such A Advance until such principal
amount is paid in full, at such interest rates, and payable at such times,
as are specified in the Credit Agreement.
Both principal and interest are payable in the Applicable Currency to
Bank of America National Trust and Savings Association, as Agent, for the
Account of the Bank at the applicable Payment Office in immediately
available funds. Each A Advance made by the Bank to the Borrower and the
maturity thereof, and all payments made on account of principal thereof,
shall be recorded by the Bank and, prior to any transfer hereof, endorsed
on a schedule attached hereto which is part of this Promissory Note;
provided that failure to make such recordings or to attach such schedule
shall not impair the Borrower's obligations under this Promissory Note.
This Promissory Note is one of the A Notes referred to in, and is
subject to and entitled to the benefits of, the Credit Agreement dated as
of November 18, 1996 (as amended from time to time, the "Credit
Agreement"), among the Borrower, the Bank, certain other financial
institutions parties thereto, and Bank of America National Trust and
Savings Association, as Agent. The Credit Agreement, among other things,
provides for the making of A Advances by the Bank to the Borrower from time
to time pursuant to Section 2.1 of the Credit Agreement in an aggregate
outstanding amount not to exceed at any time the Dollar Equivalent of the
Dollar amount first above mentioned, the indebtedness of the Borrower
resulting from each such A Advance being evidenced by this Promissory Note,
and contains provisions for acceleration of the maturity hereof upon the
happening of certain stated events and also for prepayments on account of
principal hereof prior to the maturity hereof upon the terms and conditions
therein specified.
THIS WRITTEN AGREEMENT AND THE CREDIT DOCUMENTS, AS DEFINED IN THE
CREDIT AGREEMENT, REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY
NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.
BELDEN WIRE & CABLE COMPANY
By:_________________________
Name:_______________________
Title:______________________
<PAGE>
<PAGE>
Exhibit A-2
B PROMISSORY NOTE
U.S. $[_____________________] [date________________]
For value received, the undersigned, BELDEN WIRE & CABLE COMPANY, a
Delaware corporation (the "Borrower"), hereby promises to pay to the order
of [_____________________] (the "Bank") for the account of its Applicable
Lending Office (as defined in the Credit Agreement referred to below, the
defined terms of which are used herein unless otherwise defined herein),
the principal amount of each B Advance made by the Bank to the undersigned
from time to time from the date hereof up to the Termination Date, together
with interest accrued thereon and at such rates as may be so offered and
accepted, on the last day of the Interest Period for such B Advance, in the
currency in which the loan made hereunder was made by the Bank to the
Borrower.
Both principal and interest are payable in the currency specified
above to Bank of America National Trust and Savings Association, as Agent,
for the account of the Bank at the applicable Payment Office in immediately
available funds. The amounts and dates of all B Advances and the amounts
and dates of all payments thereon shall be endorsed by the Bank on a grid
in the form of the Schedule attached hereto, which is a part of this Note.
Any failure by the Bank to endorse or such grid shall not negate the
obligation of the Borrower to repay amounts due and owing hereunder.
This Promissory Note is one of the B Notes referred to in, and is
subject to and entitled to the benefits of, the Credit Agreement dated as
of November 18, 1996 (as amended from time to time, the "Credit
Agreement"), among the Borrower, the Bank, certain other financial
institutions parties thereto, and Bank of America National Trust and
Savings Association, as Agent. The Credit Agreement, among other things,
contains provisions for acceleration of the maturity hereof upon the
happening of certain stated events.
Prior to any transfer of this Note, each outstanding B Advance made by
the Bank to the undersigned under the Credit Agreement (including any
refinancing thereof), the interest rate and Interest Period applicable
thereto and all payments of principal hereof by the undersigned to the Bank
shall be endorsed on a grid schedule or grid schedules in the form of the
schedule attached hereto and by this reference thereto made a part of this
Note. Notwithstanding the foregoing, the failure to make, or an error in
making, such endorsement shall not in any manner affect the obligation of
the undersigned hereunder.
THIS WRITTEN AGREEMENT AND THE CREDIT DOCUMENTS, AS DEFINED IN THE
CREDIT AGREEMENT, REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY
NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.
BELDEN WIRE & CABLE COMPANY
By:________________________
Name:______________________
Title:_____________________
<PAGE>
<PAGE>
SCHEDULE
Amount of
Amount of Interest Maturity Date Principal
Date Bid Loan Rate of Interest Period Repaid Currency
<PAGE>
<PAGE>
Exhibit B-1
FORM OF REQUEST FOR A BORROWING
[Date]
Bank of America National Trust and Savings Association,
as Agent for the Banks parties to the
Credit Agreement referred to below
Agency Management Services
1455 Market Street, 12th Floor
San Francisco, CA 94137
Phone: ______________________
Telecopy: ___________________
Attention: _______________________
Agency Services Officer
Ladies and Gentlemen:
Reference is made to the Credit Agreement dated as of November 18, 1996 (as
amended from time to time, the "Credit Agreement"), among the undersigned,
certain financial institutions parties thereto, and Bank of America
National Trust and Savings Association, as Agent, the defined terms of
which are used herein unless otherwise defined herein. Pursuant to Section
2.1 of the Credit Agreement, the Borrower hereby irrevocably requests an A
Borrowing under the Credit Agreement, and in that regard sets forth the
following information regarding such A Borrowing:
Date of A Borrowing 1 :
Type of Advances 2 :
Applicable Currency 3 :
Aggregate Amount :
Interest Period 4 :
The Borrower hereby certifies that the following statements are true
on the date hereof, and will be true on the date of the proposed A
Borrowing:
1 The date of the A Borrowing must be a Business Day. The
Borrower must give three Business
Days' advance notice for A Borrowings comprised of LIBOR
Rate Advances.
2 The Type of Advances comprising the A Borrowing may be
Base Rate Advances or LIBOR Rate Advances.
3 The Applicable Currency may be U.S. Dollars, Pounds
Sterling, German Marks, French Francs, Italian Lira,
Dutch Guilders, Japanese Yen, Canadian Dollars, Swiss
Francs, Australian Dollars or any other currency approved
by the Banks.
4 Interest Period applies only to LIBOR Rate Advances
and may be one, two, three, or six months. Insert "N/A"
for Base Rate Advances. <PAGE>
<PAGE>
Bank of America, as Agent
[Date]
Page 2
(a) the representations and warranties contained in Article 4 of
the Credit Agreement are correct on and as of the date of the proposed A
Borrowing, before and after giving effect to the proposed A Borrowing and
to the application of the proceeds therefrom, as though made on and as of
such date,
(b) no event has occurred and is continuing, or would result from
the proposed A Borrowing or from the application of the proceeds therefrom,
which constitutes a Default or an Event of Default, and
(c) following the making of the proposed A Borrowing and all
other Borrowings to be made on the same day to the Borrower under the
Credit Agreement, the aggregate outstanding Dollar Equivalent principal
amount of Advances shall not exceed the aggregate amount of the
Commitments.
Very truly yours,
BELDEN WIRE & CABLE COMPANY
By:_________________________
Name:_______________________
Title:______________________
-2- <PAGE>
<PAGE>
Exhibit B-2
FORM OF REQUEST FOR B BORROWING
[Date]
Bank of America National Trust and Savings Association,
as Agent for the Banks parties to the
Credit Agreement referred to below
Agency Management Services
1455 Market Street, 12th Floor
San Francisco, CA 94137
Phone: _______________________
Telecopy: _______________________
Attention: _______________________
Agency Services Officer
Ladies and Gentlemen:
Reference is made to the Credit Agreement dated as of November 18, 1996 (as
amended from time to time, the "Credit Agreement"), among the undersigned,
certain financial institutions parties thereto, and Bank of America
National Trust and Savings Association, as Agent, the defined terms of
which are used herein unless otherwise defined herein. Pursuant to Section
2.2 of the Credit Agreement, the Borrower hereby requests offers from the
Banks to make B Advances to the Borrower as part of a B Borrowing under the
Credit Agreement, and in that regard sets forth the following information
regarding such proposed B Borrowing:
Date of B Borrowing 1 :
Applicable Currency 2 :
Aggregate Amount 3 :
Maturity Date 4 :
1 The Date of B Borrowing must be a Business Day. The Borrower
must give four Business Days' advance notice of B Borrowings to
be made in any Alternate Currency or with an interest rate basis
of LIBOR plus a margin, and one Business Day's advance notice of
B Borrowings to be made in Dollars with an interest rate basis of
an absolute rate.
2 The Applicable Currency may be U.S. Dollars, Pounds Sterling,
German Marks, French Francs, Italian Lira, Dutch Guilders,
Japanese Yen, Canadian Dollars, Swiss Francs, Australian Dollars,
or any other currency approved by the Banks.
3 The Aggregate Amount of the B Borrowing must be in a minimum
aggregate Dollar Equivalent principal amount of $2,000,000 and be
made in 1,000,000 unit multiples of the Applicable Currency.
4 The Maturity Date of the B Advances must be on a Business Day
which is 7 to 30 days after the date of the B Advances, if the B
Advances have an interest rate basis based upon an absolute rate,
or must be on the last date of an Interest Period (of 1, 2, 3, or
6 months) for such B Advances, if the B Advances have an interest
rate basis based upon the LIBOR plus a margin. In no event may
the Maturity Date exceed the Termination Date.
<PAGE>
<PAGE>
Interest Rate Basis 5 :
Interest Calculation Basis 6 :
Interest Payment Dates :
The Borrower requests prompt response to this Request for B Borrowing in
accordance with Section 2.2 of the Credit Agreement.
Very truly yours,
BELDEN WIRE & CABLE COMPANY
By:________________________
Name:________________________
Title:________________________
5 The Interest Rate Basis must be expressed as "Absolute Rate" or
"LIBOR Plus Margin."
6 If the Interest Rate Basis is based upon an absolute rate, the
Interest Calculation shall be specified as 360-day year,
365/366-day year, or any other method proposed by the Borrower.
If the Interest Rate Basis is based upon the LIBOR, the Interest
Calculation Basis shall be the same as the basis for computing
regular interest on A Advances in the same currency under the
Credit Agreement.
-2- <PAGE>
<PAGE>
Exhibit B-3
FORM OF OFFER OF B ADVANCES
[Date]
Bank of America National Trust and Savings Association,
as Agent for the Banks parties to the
Credit Agreement referred to below
Agency Management Services
1455 Market Street, 12th Floor
San Francisco, CA 94137
Phone: _______________________
Telecopy: ____________________
Attention: _______________________
Agency Services Officer
Ladies and Gentlemen:
Reference is made to the Credit Agreement dated as of November 18, 1996 (as
amended from time to time, the "Credit Agreement"), among Belden Wire &
Cable Company, the undersigned, certain financial institutions parties
thereto, and Bank of America National Trust and Savings Association, as
Agent, the defined terms of which are used herein unless otherwise defined
herein. In response to the Borrower's Request for B Borrowing dated
[____________] (the "Request for B Borrowing"), and pursuant to Section
2.2(b)(ii) of the Credit Agreement, the undersigned hereby irrevocably
offers to make the following B Advances to the Borrower as part of the B
Borrowing proposed by the Borrower in the Request for B Borrowing, and in
that regard sets forth the following information regarding such B Advances:
Advance #1
Minimum Amount 1 :
Maximum Amount :
Interest Rate 2 :
[Advance #2
Minimum Amount :
Maximum Amount :
Interest Rate :]
1 The Minimum Amount of each B Advance offered must be in a minimum
Dollar Equivalent principal amount of $1,000,000 and be made in
500,000 unit multiples of the Applicable Currency.
2 The Interest Rate must be expressed in accordance with the interest
rate basis specified by the Borrower in the applicable Request for B
Borrowing, either an absolute rate or a rate based upon the
applicable LIBOR plus a margin; therefore, this must be filled in
either as "____% per annum" or "LIBOR plus ____% per annum", in
each case rounded to the nearest 1/100th of one percent
<PAGE>
<PAGE>
Bank of America, as Agent
[Date]
Page 2
The undersigned confirms that for each offered B Advance specified above,
the date of borrowing, Applicable Currency, maturity date, interest
calculation basis, and interest payment dates shall be those proposed by
the Borrower in the Request for B Borrowing and that the undersigned is
prepared to extend credit to the Borrower on the terms described above, in
accordance with and subject to the applicable terms of the Credit
Agreement, including Section 2.2(b)(iii) regarding the allocation of B
Advances, which are deemed incorporated into this offer.
Very truly yours,
[Name of Bank]
By:_______________________
Name:_______________________
Title:_______________________
-2- <PAGE>
<PAGE>
Exhibit B-4
FORM OF ACCEPTANCE OF B ADVANCES
[Date]
Bank of America National Trust and Savings Association,
as Agent for the Banks parties to the
Credit Agreement referred to below
Agency Management Services
1455 Market Street, 12th Floor
San Francisco, CA 94137
Phone: ______________________
Telecopy: ___________________
Attention: _______________________
Agency Services Officer
Ladies and Gentlemen:
Reference is made to the Credit Agreement dated as of November 18, 1996 (as
amended from time to time, the "Credit Agreement"), among the undersigned,
certain financial institutions parties thereto, and Bank of America
National Trust and Savings Association, as Agent, the defined terms of
which are used herein unless otherwise defined herein. Pursuant to the
Request for B Borrowing dated as of [ ] (the "Request for B
Borrowing"), the Borrower requested a B Borrowing under the following
terms:
Date of B Borrowing :
Applicable Currency :
Aggregate Amount :
Maturity Date :
Interest Rate Basis :
Interest Calculation Basis :
Interest Payment Dates :
After reviewing the offers made by the Banks to the Borrower in response to
the Request for B Borrowing, pursuant to and in accordance with Section
2.2(b)(iii) of the Credit Agreement the Borrower has [elected to cancel its
request for a B Borrowing, and each offer made by the Banks in connection
with the Request for B Borrowing is rejected.] [elected to make a B
Borrowing in an aggregate amount of [_________] 1, and hereby irrevocably
accepts the following offers made by the
Banks:
1 The B Borrowing must be in an aggregate Dollar Equivalent
principal amount of $2,000,000 and be made in 1,000,000 unit
multiples of the Applicable Currency. The principal amount of
the B Borrowing may not exceed the amount specified in the
applicable Request for B Borrowing.
<PAGE>
<PAGE>
Bank of America, as Agent
[Date]
Page 2
Advance #1
Bank :
Date of Offer :
Amount 2 :
Interest Rate :
[Advance #2
Bank :
Date of Offer :
Amount :
Interest Rate :]
For each offered B Advance specified above, the Borrower confirms that in
such offer the date of borrowing, Applicable Currency, maturity date,
interest calculation basis, and interest payment dates were those proposed
by the Borrower in the Request for B Borrowing.
The Borrower further confirms that the offers accepted represent the lowest
interest rate offers received by the Borrower and that each offer has been
accepted in at least the minimum amount allowed pursuant to Section
2.2(b)(i) of the Credit Agreement on the terms of the offer, and if
multiple offers were made at the same interest rate all offers accepted by
the Borrower at such interest rate have been allocated among the Banks
having made offers in accordance with Section 2.2(b)(iii) of the Credit
Agreement, the terms of which were incorporated into such offers. The
Borrower rejects all other offers received in connection with the Request
for B Borrowing.
The Borrower hereby certifies that the following statements are true on the
date hereof, and will be true on the date of the proposed B Borrowing:
(a) the representations and warranties contained in Article 4 of
the Credit Agreement are correct on and as of the date of the proposed B
Borrowing, before and after giving effect to the proposed B Borrowing and
to the application of the proceeds therefrom, as though made on and as of
such date,
(b) no event has occurred and is continuing, or would result from
the proposed B Borrowing or from the application of the proceeds therefrom,
which constitutes a Default or an Event of Default, and
2 The Amount of each B Advance accepted must be at least the
minimum amount, but no greater than the maximum amount, specified
in the related offer.
-2- <PAGE>
<PAGE>
Bank of America, as Agent
[Date]
Page 3
(c) following the making of the proposed B Borrowing and all
other Borrowings to be made on the same day to the Borrower under the
Credit Agreement, the aggregate outstanding Dollar Equivalent principal
amount of Advances shall not exceed the aggregate amount of the
Commitments.
Very truly yours,
BELDEN WIRE & CABLE COMPANY
By:_________________________
Name:_______________________
Title:______________________
-3- <PAGE>
<PAGE>
Exhibit C
FORM OF COMPLIANCE CERTIFICATE
[Date]
Bank of America National Trust and Savings Association,
as Agent for the Banks parties to the
Credit Agreement referred to below
231 South LaSalle Street
Chicago, IL 60697
Attention: Mr. Michael Healy
Ladies and Gentlemen:
I refer to the Credit Agreement dated as of November 18, 1996 (as amended
from time to time, the "Credit Agreement"), among Belden Wire & Cable
Company, certain financial institutions parties thereto, and Bank of
America National Trust and Savings Association, as Agent, the defined terms
of which are used herein unless otherwise defined herein.
I hereby certify that I have no knowledge of any Defaults by the Borrower
in the observance of any of the provisions in the Credit Agreement which
existed as of [__] or which exist as of the date of this letter.
I also certify that the accompanying consolidated financial statements
present fairly, in all material respects, the consolidated financial
condition of Belden Inc. as of [_____], and the related results of
operations for the [____] then ended, [in conformity with generally
accepted accounting principles] [and that the financial statements include
all adjustments, consisting only of normal recurring adjustments, necessary
for a fair presentation of the financial information presented therein].
The following sets forth the information and computations to demonstrate
compliance with the requirements of Sections 5.2 and 5.8 of the Credit
Agreement as of [_______]:
A. Section 5.2 Leverage Ratio
1. consolidated Debt $____________
2. consolidated Total
Capitalization $____________
3. ratio A.1 / A.2 [___] to 1.00
4. maximum 0.65 to 1.00
<PAGE>
<PAGE>
Bank of America, as Agent
[Date]
Page 2
B. Section 5.8 Net Worth
1. 80% of consolidated Net Worth
as of 6/30/96 $___________
2. 50% of cumulative consolidated
quarterly net income since
6/30/96 1 $___________
3. minimum Net Worth = B.1 + B.2 $___________
4. consolidated Net Worth $___________
Very truly yours,
_____________________________________
Treasurer
1 Excluding consolidated net income for any fiscal quarter in which
net income is a negative number.
-2- <PAGE>
<PAGE>
Exhibit D
FORM OF GUARANTY
This Guaranty dated as of [date] ("Agreement"), is made by
[_________________] ("Guarantor") in favor of the Agent for the ratable
benefit of the Banks referred to below.
INTRODUCTION
This Guaranty is given in connection with the Credit Agreement dated
as of November 18, 1996 (as amended from time to time, the "Credit
Agreement"), among Belden Wire & Cable Company, a Delaware corporation
("Borrower"), Bank of America National Trust and Savings Association
("Agent"), and the financial institutions party thereto. Capitalized terms
used herein but not defined herein shall have the meanings specified by the
Credit Agreement. As a condition precedent to the extension of credit under
the Credit Agreement, the Agent and the Banks require the Guarantor to
enter into this Agreement. The Guarantor believes that it will obtain
substantial direct and indirect benefit from the credit extended to the
Borrower by the Banks under the Credit Agreement.
In consideration of the foregoing and for other valuable consideration
received, the Guarantor and the Agent agree as follows:
Section 1. Guaranty.
1.1 The Guarantor irrevocably guarantees to the Agent the full payment
when due of (a) all principal, interest, fees, reimbursements,
indemnifications, and other amounts now or hereafter owed by the Borrower
to the Agent and the Banks under the Credit Agreement and the other Credit
Documents, and (b) any increases, extensions, and rearrangements of the
foregoing obligations under any amendments, supplements, and other
modifications of the documents and agreements creating the foregoing
obligations (collectively, the "Guaranteed Obligations"). This is a
guaranty of payment and not merely a guaranty of collection, and the
Guarantor is liable as a primary obligor. If any of the Guaranteed
Obligations are not punctually paid when due, whether by maturity,
acceleration, or otherwise, and the Agent shall notify the Guarantor of the
existence of a declared Event of Default under the Credit Agreement and
make demand for payment hereunder, the Guarantor shall immediately pay to
the Agent, for the ratable benefit of the Banks, the full amount due. The
Guarantor shall make each payment to the Agent in U.S. Dollars (or if the
applicable Guaranteed Obligation is to be paid in an Alternate Currency, in
such Alternate Currency) in immediately available funds as directed by the
Agent. The Agent and each Bank is hereby authorized at any time following
any demand for payment hereunder to set off and apply any indebtedness owed
by the Agent or the Bank to the Guarantor against any and all of the
obligations of the Guarantor under this Agreement. The Agent and each Bank
severally agrees to promptly notify the Guarantor after any such setoff and
application, but the failure to give such notice shall not affect the
validity of such setoff and application.
1.2 If any sum due from the Guarantor under this Agreement or any
order or judgment given in relation hereto has to be converted from the
currency (the "first currency") in which the same is payable hereunder or
under such order or judgment into another currency (the "second currency")
<PAGE>
<PAGE>
for the purpose of (a) making or filing a claim or proof against the
Guarantor with any governmental authority or in any court or tribunal or
(b) enforcing any order or judgment given in relation hereto, the Guarantor
shall indemnify each Person to whom such sum is due against any loss
actually suffered as a result of any discrepancy between (i) the rate of
exchange used when restating the amount in question from the first currency
into the second currency and (ii) the rate or rates of exchange at which
such Person, acting in good faith in a commercially reasonable manner,
purchased the first currency with the second currency after receipt of a
sum paid to it in the second currency in satisfaction, in whole or in part,
of any such order, judgment, claim, or proof. The foregoing indemnity shall
constitute a separate obligation of the Guarantor distinct from its other
obligations hereunder and shall survive the giving or making of any
judgment or order in relation to all or any of such other obligations.
1.3 This Agreement shall continue to be effective or be reinstated,
as the case may be, if any payment on the Guaranteed Obligations must be
refunded under any bankruptcy proceeding. In the event that the Agent or
any Bank must refund any payment received against the Guaranteed
Obligations, any prior release from the terms of this Agreement given to
the Guarantor by the Agent shall be without effect, and this Agreement
shall be reinstated in full force and effect. It is the intention of the
Guarantor that the Guarantor's obligations hereunder shall not be
discharged except by final payment of the Guaranteed Obligations.
Section 2. Guaranty Absolute.
2.1 In the event that one or more other parties guarantees all or
part of the Guaranteed Obligations, such other guarantees shall not reduce
the Guarantor's obligations hereunder and the Guarantor shall remain fully
liable for all of the Guaranteed Obligations.
2.2 There are no conditions precedent to the enforcement of this
Agreement, except as expressly contained herein. It shall not be necessary
for the Agent, in order to enforce payment by the Guarantor under this
Agreement, to exhaust the Agent's remedies against the Borrower or any
other person liable for the payment of the Guaranteed Obligations, to
enforce any support for the payment of the Guaranteed Obligations, or to
enforce any other means of obtaining payment of the Guaranteed Obligations.
Neither the Agent nor the Banks shall be required to mitigate damages or
take any other action to reduce, collect, or enforce the Guaranteed
Obligations.
2.3 The Guarantor agrees that the Guarantor's obligations under this
Agreement shall not be released, diminished, or impaired by, and waives any
rights which the Guarantor might otherwise have which relate to:
(a) Any lack of validity or enforceability of the Guaranteed
Obligations, any Credit Document, or any other agreement or instrument
relating thereto;
(b) Any increase, reduction, extension, or rearrangement of the
Guaranteed Obligations, any amendment, supplement, or other modification of
the Credit Documents, or any waiver or consent granted under the Credit
Documents, including waivers of the payment and performance of the
Guaranteed Obligations;
-2- <PAGE>
<PAGE>
(c) Any release, exchange, subordination, waste, or other
impairment of any collateral, if any, securing payment of the Guaranteed
Obligations;
(d) Any full or partial release of any other guarantor, or any
other person liable for the payment of the Guaranteed Obligations;
(e) Any change in the organization or structure of the Borrower,
any guarantor, or any other person liable for the payment of the Guaranteed
Obligations; or the insolvency, bankruptcy, liquidation, or dissolution of
the Borrower or any other person liable for the payment of the Guaranteed
Obligations;
(f) The failure to apply or any manner of applying payments or
the proceeds of any collateral, if any, against the Guaranteed Obligations;
(g) The failure to give notice of the occurrence of any of the
events or actions referred to in this Section 2.3, notice of any default or
event of default, however denominated, under the Credit Documents, notice
of intent to demand, notice of demand, notice of presentment for payment,
notice of nonpayment, notice of intent to protest, notice of protest,
notice of grace, notice of dishonor, notice of intent to accelerate, notice
of acceleration, notice of bringing of suit, notice of sale or foreclosure
of any collateral, if any, for the Guaranteed Obligations, notice of the
Agent's or Banks' transfer of the Guaranteed Obligations, notice of the
financial condition of or other circumstances regarding the Borrower or any
other person liable for the Guaranteed Obligations, or any other notice of
any kind relating to the Guaranteed Obligations ; and
(h) Any other action taken or omitted which affects the
Guaranteed Obligations, whether or not such action or omission prejudices
the Guarantor or increases the likelihood that the Guarantor will be
required to pay the Guaranteed Obligations pursuant to the terms hereof--it
is the unambiguous and unequivocal intention of the Guarantor that the
Guarantor shall be obligated to pay the Guaranteed Obligations when due,
notwithstanding any occurrence, circumstance, event, action, or omission
whatsoever, whether contemplated or uncontemplated, and whether or not
particularly described herein. Notwithstanding any other provision
contained in this Agreement, the Guarantor's liability with respect to the
principal amount of the Guaranteed Obligations shall be no greater than the
liability of the Borrower with respect thereto.
Section 3. Subrogation. [Until one year and one day after all
Guaranteed Obligations have been paid irrevocably in full, the Guarantor
agrees not to take] [The Guarantor waives] any action pursuant to any
rights which it may acquire against the Borrower or any other person liable
for the payment of the Guaranteed Obligations under this Agreement,
including any right of subrogation (including any statutory rights of
subrogation under Section 509 of the Bankruptcy Code, 11 U.S.C. 509),
contribution, indemnification, reimbursement, exoneration, or any right to
participate in any claim or remedy of the Agent or the Banks against the
Borrower or any collateral, if any, which the Agent or the Banks now have
or acquire. If any amount shall be paid to the Guarantor in violation of
the preceding sentence, such amount shall be held in trust for the benefit
of the Banks and immediately turned over to the Agent, for the ratable
benefit of the Banks, with any necessary endorsement to be applied to the
Guaranteed Obligations.
-3- <PAGE>
<PAGE>
Section 4. Miscellaneous.
4.1 The Guarantor agrees to pay on demand (i) all reasonable costs
and expenses of the Agent in connection with the creation, modification,
and amendment of this Guaranty, including the reasonable Attorney Costs for
the Agent with respect thereto; and (ii) all costs and expenses, if any
(including reasonable Attorney Costs), of the Agent and each Bank in
connection with the enforcement (whether through negotiations, legal
proceedings, or otherwise) against the Guarantor of this Guaranty.
4.2 The Guarantor agrees to indemnify the Agent and each Bank and
their respective officers, directors, employees, and agents from, and hold
each of them harmless against, any and all losses, liabilities, claims,
damages, or expenses (including the reasonable Attorney Costs) incurred by,
imposed upon, or asserted against any of them arising out of or by reason
of any actual or threatened litigation or other proceeding relating to the
making or performance by the Guarantor of this Agreement, any actual or
proposed use by the Guarantor of the proceeds of any of the Advances, and
any actions of the Agent or the Banks or such persons related to the
enforcement of the rights of the Agent and the Banks under this Agreement
and the other Credit Documents, INCLUDING ACTIONS WHICH CONSTITUTE THE
NEGLIGENCE OF THE AGENT OR THE BANKS, but excluding any such losses,
liabilities, claims, damages, or expenses incurred by reason of the gross
negligence or willful misconduct of person or entity to be indemnified. The
obligations of the Guarantor under this Section 4.2 shall survive the
termination of this Agreement.
4.3 This Agreement shall be governed by the laws of the State of
Illinois. If any provision in this Agreement is held to be unenforceable,
such provision shall be severed and the remaining provisions shall remain
in full force and effect. All representations, warranties, and covenants of
the Guarantor in this Agreement shall survive the execution of this
Agreement and any other contract or agreement. If a due date for an amount
payable is not specified in this Agreement, the due date shall be the date
on which the Agent demand payment therefor. The Agent's remedies under this
Agreement shall be cumulative, and no delay in enforcing this Agreement
shall act as a waiver of the Agent's or the Banks' rights hereunder. The
provisions of this Agreement may be waived or amended only in a writing
signed by the party against whom enforcement is sought. This Agreement
shall bind the Guarantor and its successors and assigns and shall inure to
the benefit of the Agent and its successors and assigns. The Guarantor may
not assign its rights or delegate its duties under this Agreement. The
Agent may assign its rights and delegate its duties under this Agreement.
This Agreement may be executed in multiple counterparts which together
shall constitute one and the same agreement. Unless otherwise specified,
all notices provided for in this Agreement shall be in writing, delivered
to the following addresses or to such other address as shall be designated
by one party in writing to the other parties: if to the Agent: Bank of
America National Trust and Savings Association, Attention: Mr. Michael
Healy, 231 South LaSalle Street, Chicago, Illinois 60697, Telephone:
312/828-6480, Telecopy: 312/987-5833; if to the Guarantor:
[_______________]. Notice sent by telecopy shall be deemed to be given and
received when receipt of such transmission is acknowledged, and delivered
notice shall be deemed to be given and received when receipted for by, or
actually received by, an authorized officer of the receiving party.
-4- <PAGE>
<PAGE>
THE GUARANTOR AND THE AGENT IRREVOCABLY WAIVE RIGHT TO TRIAL BY JURY
IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
THIS WRITTEN AGREEMENT AND THE CREDIT DOCUMENTS REPRESENT THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
EXECUTED as of the date first above written.
[GUARANTOR]
By:______________________________
Name:____________________________
Title:___________________________
-5- <PAGE>
<PAGE>
Exhibit E
FORM OF ASSIGNMENT AND ACCEPTANCE
Dated [ ], 19[ ]
Reference is made to the Credit Agreement dated as of November 18,
1996 (as amended from time to time, the "Credit Agreement"), among Belden
Wire & Cable Company, a Delaware corporation (the "Borrower"), the
financial institutions which are parties thereto, and Bank of America
National Trust and Savings Association, as Agent. Capitalized terms used
herein but not defined herein shall have the meanings specified by the
Credit Agreement.
Pursuant to the terms of the Credit Agreement, [ ] (the "Assignor")
wishes to assign and delegate to [ ] (the "Assignee") [ ]% 1 of its
rights and obligations under the Credit Agreement in connection with its
Commitment and its outstanding A Advances and A Note. [In addition, the
Assignor wishes to assign and delegate to the Assignee $[ ] of its
outstanding B Advance(s) and B Note]. Therefore, in accordance with Section
8.6 of the Credit Agreement, the Assignor, the Assignee, and the Agent
agree as follows:
1. The Assignor hereby sells and assigns and delegates to the
Assignee, and the Assignee hereby purchases and assumes from the Assignor,
as of the Effective Date (as defined below), without recourse to the
Assignor and without representation or warranty except for the
representations and warranties specifically set forth in Section 2 hereof,
a [ ]% interest in and to all of the Assignor's rights and obligations
under the Credit Agreement in connection with its Commitment, its
outstanding A Advances, and its A Note [, and $[ ] of its outstanding
B Advance(s) and B Note]. Attached to this Agreement are the following
Notes:
A Note in a maximum principal amount of $[ ] dated as of
[ ], made by the Borrower and payable to the order of the
Assignor.
[B Note in a principal amount of $[ ] dated as of [ ], made by
the Borrower and payable to the order of the Assignor.]
The Assignor and the Assignee request that the Agent exchange such Notes
for the following Notes:
1 Specify percentage in no less than 4 decimal points.
<PAGE>
<PAGE>
[A Note in a maximum principal amount of $[ ] dated as of [ ],
made by the Borrower and payable to the order of the Assignee.]
[A Note in a maximum principal amount of $[ ] dated as of [ ],
made by the Borrower and payable to the order of the the Assignor.]
[B Note in a maximum principal amount of $[ ] dated as of [ ],
made by the Borrower and payable to the order of the Assignee.]
[B Note in a maximum principal amount of $[ ] dated as of [ ],
made by the Borrower and payable to the order of the Assignor.]
2. The Assignor (a) represents and warrants that, prior to executing
this Assignment and Acceptance, its Commitment is $[ ], and the aggregate
outstanding principal amount of A Advances owed to it by the Borrower is
$[ ], and the aggregate outstanding principal amount of B Advances owed
to it by the Borrower is $[ ]; and (b) represents and warrants that it
is the legal and beneficial owner of the interest being assigned by it
hereunder and that such interest is free and clear of any adverse claim.
The Assignor makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties, or
representations made in or in connection with the Credit Agreement or any
other Credit Document or the execution, legality, validity, enforceability,
genuineness, sufficiency, or value of the Credit Agreement or any other
Credit Document or any other instrument or document furnished pursuant
thereto. The Assignor makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower or
the performance or observance by the Borrower of any of its respective
obligation sunder the Credit Agreement or any other credit Document or any
other instrument or document furnished pursuant thereto.
3. The Assignee (a) confirms that it has received a copy of the
Credit Agreement, together with copies of the financial statements referred
to in Section 4.3 thereof and such other documents and information as it
has deemed appropriate to make its own credit analysis and decision to
enter into this Assignment; (b) agrees that it will, independently and
without reliance upon the Agent, the Assignor, or any other Bank and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action
under the Credit Agreement; (c) appoints and authorizes the Agent to take
such action as agent on its behalf and to exercise such powers under the
Credit Agreement as are delegated to the Agent by the terms thereof,
together with such powers as are reasonably incidental thereto; (d) agrees
that it will perform in accordance with their terms all of the obligations
which by the terms of the Credit Agreement are required to be performed by
it as a Bank; (e) specifies as its Domestic Lending Office (and address for
notices) and Alternate Lending Offices the offices set forth beneath its
name on the signature pages hereof; (f) attaches the forms prescribed by
the Internal Revenue Services of the United States certifying as to the
Assignee's status for purposes of determining exemption from United States
withholding taxes with respect to all payments to be made to the Assignee
under the Credit Agreement and its Note(s) or such other documents as are
necessary to indicate that all such payments are subject to such rates at a
rate reduced by an applicable tax treaty , and (g) represents that it an
assignee eligible under Section 8.6 of the Credit Agreement.
2 If the Assignee is organized under the laws of a jurisdiction
outside the United States.
-2- <PAGE>
<PAGE>
4. The effective date for this Assignment and acceptance shall be
[ ] (the "Effective Date") 3, and following the execution of this
Assignment, the Agent will record it.
5. Upon such recording, and as of the Effective Date, (a) the
Assignee shall be a party to the Credit Agreement for all purposes and, to
the extent provided in this Assignment, have the rights and obligations of
a Bank thereunder and (b) the Assignor shall, to the extent provided
herein, relinquish its rights (other than rights against the Borrower
pursuant to Section 8.4 of the Credit Agreement, which shall survive this
assignment) and be related from its obligations under the Credit Agreement.
6. Upon such recording, from and after the Effective Date, the Agent
shall make all payments under the Credit Agreement and the Note(s) in
respect of the interest assigned hereby (including, without limitation, all
payments of principal, interest, and fees) to the Assignee. The Assignor
and Assignee shall make all appropriate adjustments in payment under the
Credit Agreement and the Note(s) for periods prior to the Effective Date
directly between themselves.
7. This Assignment shall be governed by, and construed and enforced
in accordance with, the laws of the State of Illinois.
The parties hereto have caused this Assignment to be duly executed as
of the date first above written.
3 See Section 8.6(a) of the Credit Agreement. Such date shall be
at least three Business Days after the execution of this
Assignment.
-3- <PAGE>
<PAGE>
[ASSIGNOR]
By__________________________
Name________________________
Title_______________________
Address: __________________
__________________
__________________
Attention:__________________
Telephone:__________________
Telecopy: __________________
[ASSIGNEE]
By__________________________
Name_______________________
Title_______________________
Domestic Lending Office:
Address: __________________
__________________
__________________
Attention:__________________
Telephone:__________________
Telecopy: __________________
Alternate Lending Office:
By__________________________
Name________________________
Title_______________________
Address: __________________
__________________
__________________
Attention:__________________
Telephone:__________________
Telecopy: __________________
-4- <PAGE>
<PAGE>
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION
as Agent
By__________________________
Name________________________
Title_______________________
-5- <PAGE>
<PAGE>
SCHEDULE I
BORROWER
Notice Address: Belden Inc.
7701 Forsyth Boulevard, Suite 800
St. Louis, Missouri 63105
Attn: Mr. Terry Lee
314-854-8025
314-854-8001 (fax)
AGENT
Notice Address: Bank of America National Trust
and Savings Association
231 South LaSalle Street
Chicago, Illinois 60697
Attn: Mr. Michael G. Healy
312-828-6480
312-987-5833 (fax)
Agency Administration: Bank of America National Trust
Notices and Savings Association
Agency Administrative Services #5596
1455 Market Street 13th Floor
San Francisco, CA 94103
Attn: Mr. George Slawek
415-436-2747
415-436-2700 (fax)
Domestic Lending Office: Bank of America National Trust
and Savings Association
231 South LaSalle Street
Chicago, Illinois 60697
Attn: Zack Zarr
312-828-7380
312-974-9626 (fax)
Alternate Lending
Office: As specified by the Agent for Alternate
Currency Advances
BANKS
NationsBank, N.A.
Notice Address: NationsBank, N.A.
233 S. Wacker Dr. Suite 2800
Chicago, IL 60606
Attn: Valerie C. Mills
312-234-5649
312-234-5601 (fax) <PAGE>
<PAGE>
Domestic Lending Office: NationsBank, N.A.
101 N. Tryon St.
Charlotte, NC 28255
Attn: Renita Hines
704-386-9875
704-386-8694 (fax)
Alternate Lending
Office: Same
The Boatmen's National Bank of St. Louis
Notice Address: The Boatmen's National Bank
of St. Louis
800 Market Street
St. Louis, Missouri 63101
Attn: Emil A. Krueger
314-466-5211
314-466-7783 (fax)
Domestic Lending Office: The Boatmen's National Bank
of St. Louis
800 Market Street
St. Louis, Missouri 63101
Attn: Ms. Carolyn D. Hayes
314-466-6547
314-466-7783 (fax)
Alternate Lending
Office: Same
Commerzbank Aktiengesellschaft, Grand Cayman Branch
Notice Address: Commerzbank Aktiengesellschaft,
c/o Chicago Branch
311 South Wacker Drive, Suite 5800
Chicago, Illinois 60606
Attn: Mr. Mark D. Monson
312-408-6910
312-435-1486 (fax)
Domestic Lending Office: Commerzbank Aktiengesellschaft,
c/o Chicago Branch
2 World Financial Center
New York, NY 10281-1050
Attn: Mr. Matt Marraffa
212-266-7268
212-266-7593 (fax)
Alternate Lending
Office: Same
-2- <PAGE>
<PAGE>
ABN AMRO BANK N.V.
Notice Address: ABN AMRO Bank N.V.
135 S. LaSalle St.
#625
Chicago, Illinois 60674-9135
Attn: Mr. John Church
312-904-2212
312-606-8425 (fax)
Domestic Lending Office: ABN AMRO Bank N.V.
135 S. LaSalle St.
#625
Chicago, Illinois 60674-9135
Attn: Loan Operations
312-904-2961
312-606-8435 (fax)
Alternate Lending
Office: Same
THE NORTHERN TRUST COMPANY
Notice Address: The Northern Trust Company
50 South LaSalle St.
Chicago, Illinois 60675
Attn: Mr. Daniel R. Hintzen
312-444-3527
312-444-7028 (fax)
Domestic Lending Office: The Northern Trust Company
50 South LaSalle St.
Chicago, Illinois 60675
Attn: Edie Reed
312-444-3352
312-630-1566 (fax)
Alternate Lending
Office: Same
-3- <PAGE>
<PAGE>
Royal Bank of Canada
Notice Address: Royal Bank of Canada
One North Franklin, Suite 700
Chicago, Illinois 60606
Attn: Ms. Molly Drennan
312-551-1615
312-551-0805 (fax)
Domestic Lending Office: Royal Bank of Canada
Financial Square
New York, NY 10005-3531
Attn: Ms. Linda Smith
212-428-6323
212-428-2372 (fax)
Alternate Lending
Office: Same
Wachovia Bank of Georgia, N.A.
Notice Address: Wachovia Bank of Georgia, N.A.
191 Peachtree Street, NE
Suite GA 373
Atlanta, Georgia 30303
Attn: Mr. C. Volney Hill
404-332-6350
404-332-6898 (fax)
Domestic Lending Office: Wachovia Bank of Georgia, N.A.
191 Peachtree Street NE
Suite GA 378
Atlanta, Georgia 30303
Attn: Ms. Tonya Carter
910-777-5241
910-777-5111 (fax)
Alternate Lending
Office: Same
-4- <PAGE>
<PAGE>
SCHEDULE II
Pursuant to Section 4.8 of the Credit Agreement dated as of November 18,
1996, between Belden Wire & Cable Company, as Borrower, the banks named
herein, as Banks, and Bank of America National Trust and Savings
Association, as Agent, the following is a complete and correct list, as of
the date of this Agreement, of all Subsidiaries of the Borrower.
Subsidiary Place of Incorporation
Belden Brasil Comercial Ltda. Brazil
Belden (Canada) Inc. Ontario, Canada
Belden Electronics GmbH Germany
Belden Electronics, S.A. de C.V. Mexico
Belden Electronics S.a.r.l. France
Belden Europe B.V. The Netherlands
Belden Foreign Sales Corporation Barbados
Belden Holdings, Inc. Delaware, U.S.A.
Belden International, Inc. Delaware, U.S.A.
Belden UK Limited United Kingdom
Belden Wire & Cable B.V. The Netherlands
Grupo Belden Mexicana S.A. de C.V. Mexico<PAGE>
<PAGE>
SCHEDULE III
Pursuant to Section 4.9 of the Credit Agreement dated as of November 18,
1996, between Belden Wire & Cable Company, as Borrower, the Banks named
herein, and Bank of America National Trust and Savings Association, as
Agent, the following is a complete and correct list of all material credit
agreements, indentures, purchase agreements, guaranties and other
instruments in effect as of the date of this Agreement providing for or
relating to extensions of credit for a term of more than one year in
respect of which the Borrower or any of its Subsidiaries is or may become
directly or contingently obligated.
Arrangement
Amount Obligation
$150,000,000 Multicurrency revolving credit agreement, dated August 5,
1994, among Borrower, certain financial institutions party
thereto, and NationsBank of Texas, N.A., as agent. Pursuant
to Section 3.1(b)(ii) of the Credit Agreement, Borrower
shall have made arrangements satisfactory to the Agent that,
on or before November 18, 1996, the Borrower shall repay any
outstanding indebtedness under this credit agreement and in
connection with such repayment shall terminate its credit
facilities under this agreement.
$10,000,000 Promissory note of Borrower, dated November 15, 1993,
payable to NationsBank of Texas, N.A. Borrowing
arrangements under this note are uncommitted and NationsBank
of Texas, N.A. has no obligation to make any advance under
this note.
$10,000,000 Multicurrency credit agreement, dated March 9, 1995, among
Borrower, Belden (Canada) Inc., as co-borrower, and Royal
Bank of Canada, as lender. Borrowing arrangements under
this agreement are uncommitted and Royal Bank of Canada has
no obligation to make any advance under this agreement.
$40,000,000 Multicurrency promissory note of Borrower, dated May 7,
1996, payable to Wachovia Bank of Georgia, N.A. Borrowing
arrangements under this note are uncommitted and Wachovia
Bank of Georgia, N.A. has no obligation to make any advance
under this note.
6,000,000 Overdraft facility in current account, dated
Netherlands April 20, 1995, between Belden Wire & Cable B.V.,
Guilders as borrower, and Internationale Nederlanden Bank N.V., as
lender. Borrowing arrangements under this facility are
uncommitted and Internationale Nederlanden Bank N.V. has no
obligation to make any advance under this facility.
5,000,000 Overdraft facility in current account, dated July 5,
Netherlands 1995, between Belden Wire & Cable B.V., as borrower,
Guilders and ABN AMRO Bank N.V., as lender. Borrowing
arrangements under this facility are uncommitted and ABN
AMRO Bank N.V. has no obligation to make any advance under
this facility.
Please see pages 8-13 of Form 10K for the fiscal year ended
December 31, 1995, and page 12 of Form 10-Q for the fiscal
quarter ended June 30, 1996 for a brief discussion of
environmental matters and other legal proceedings.<PAGE>
<PAGE>
Belden Inc.
Selected Historical Financial Data
<TABLE>
<CAPTION>
(3)
1996 1995 1994 1993 1992
(in thousands, except per share amounts and number of employees)
<S> <C> <C> <C> <C> <C> <C>
Income statement data:
Revenues $ 667,425 $ 608,608 $ 439,699 $ 383,697 $ 366,242
Operating earnings 94,417 79,602 65,318 56,683 50,215 (4)
Income before cumulative
effect of changes in
accounting principles(3) 55,234 46,227 38,126 32,749 28,820 (4)
Net income 55,234 46,227 38,126 32,749 19,048 (4)
Net income per
common share 2.11 1.76 1.46 (1) (1)
Balance sheet data:(2)
Total assets $371,645 $ 332,787 $ 203,809 $ 196,639 $ 192,131
Long-term debt 71,630 81,458 37,277 68,000 78,369
Other long-term obligations 37,573 36,181 27,224 27,620 27,892
Stockholders' equity 179,707 131,902 93,601 60,464 45,212
Other data:
Average number of
employees 4,200 3,800 2,800 2,700 2,800
Dividends per
common share $ .20 $ .20 $ .20 -- --
(1) Net income per common share has not been presented since the Company, except for certain of its foreign operations, was an
operating division of Cooper Industries, Inc. with no separately issued or outstanding equity securities.
(2) Prior to the consummation of the Public Offering on October 6, 1993, substantially all of the excess cash generated by
Belden's operations was regularly remitted to Cooper's centralized cash management program.
(3) Effective January 1, 1992, Belden elected early adoption of SFAS No. 106 (Employers' Accounting for Postretirement
Benefits Other Than Pensions), SFAS No. 109 (Accounting for Income Taxes) and SFAS No. 112 (Employers' Accounting for
Postemployment Benefits).
(4) Includes a nonrecurring charge of $5,200 ($3,172 net of tax) for the closing of a manufacturing facility and nonrecurring
income of $3,419 ($2,086 net of tax) for the reversal of vacation accrual due to a change in the Company's policy.
25<PAGE>
<PAGE>
Management's Discussion and Analysis of
Financial Condition and Results of Operations
Results of Operations 1996 Compared With 1995
Revenues
Belden's revenues for the year ended December 31, 1996 were $667.4 million
compared with $608.6 million in 1995, an increase of 10%. Approximately
half of this increase was due to including Pope Cable and Wire B.V.
(Pope), acquired April 3, 1995, and American Electric Cordsets (AEC),
acquired March 23, 1995, for a full year in 1996 and including Intech
Cable, Inc. (Intech) since its December 3, 1996 acquisition date. The
following table shows the components of the 10% increase in the Company's
1996 revenues in each of Belden's four served markets.
% Increase
% of Total in 1996 Revenues
1996 Revenues Compared with 1995
Computer 33% 4%
Audio/video 27 16
Industrial 17 25
Electrical 23 1
The revenue growth in the computer market was primarily due to the
inclusion of Pope revenues for a full year in 1996 and the growth in
networking of computers, workstations and servers, which resulted in
increased demand for the Company's high performance twisted pair products.
Growth in revenues for the Company's networking cables was constrained
during 1996 as a result of elevated inventory levels at certain significant
customers during the middle of the year, which negatively affected orders,
and lower copper costs, which were reflected in reduced selling prices. In
addition, the Company reduced selling prices for its computer networking
cables in the latter half of the year primarily to meet competitive
demands. Sales of the Company's computer interconnection products, which
link computers to discrete peripheral devices and mainframes to terminals,
were down slightly in 1996, primarily due to competitive price reductions.
The acquisition of Intech is expected to favorably impact computer market
revenues in 1997. However, because the acquisition occurred in December,
the revenue impact in 1996 was minimal.
The revenue growth in the audio/video market was primarily due to
additional revenues from Pope and increased sales of the Company's cable
television (CATV) coaxial cable, fiber optic cable and broadcast products.
International demand for CATV drop and fiber optic cables was strong
throughout the year. However, this growth was partially offset by a decline
in demand for CATV drop cable in domestic markets. In the United States,
CATV providers have delayed spending due to uncertainties regarding
telecommunication network architecture and the effect of the
telecommunications legislation enacted in early 1996. This delayed
spending not only affected volume growth, but also negatively impacted
selling prices. Broadcast revenues benefited from the strength of this
market as technology is converted from analog to digital. Demand for
broadcast cables was also bolstered in 1996 by special events such as the
Atlanta Olympic Games and the U.S. presidential elections.
Four bar graphs depicting the percent increase in revenues compared with
the prior year for the computer, audio/video, industrial and electrical
markets are represented for the years 1996, 1995, and 1994. Data from
these graphs are shown below:
</TABLE>
<TABLE>
<CAPTION>
1996 1995 1994
<S> <C> <C> <C>
Computer 4 % 21 % 10 %
Audio/Video 16 61 22
Industrial 25 28 12
Electrical 1 54 18
</TABLE>
26 <PAGE>
<PAGE>
Continued capital investment by manufacturers and increased market
penetration by the Company primarily caused the growth in industrial market
revenues. Factory automation and product "reengineering" contributed to the
capital investment by manufacturers. The increased market penetration by
the Company resulted primarily from the introduction of new products in
1996 and a more focused sales and marketing effort. The acquisition of
Intech is expected to favorably impact the Company's industrial market
revenues in 1997.
Including the revenues of Pope and AEC for a full year accounted for all of
the growth in electrical market revenues in 1996. Excluding the impact of
these acquisitions, revenues declined almost 9%. This decline was primarily
attributable to reductions in selling prices due to lower copper costs and
weaker demand in Canada and Europe. In addition, the Company discontinued
manufacturing residential building wire in Canada during 1996 to focus on
more profitable product lines. This also contributed to the revenue
decline. Increased demand for the Company's electrical cords used on power
tools, appliances and other electrical equipment partially offset the above
declines. The Company currently expects a continued decline in electrical
market revenues in 1997 due primarily to the conversion of manufacturing
capacity in Canada away from electrical products.
Average prices for the Company's products were down in 1996 compared with
1995. This decline was primarily attributable to the decrease in copper
costs during the year and competitive price reductions on CATV, computer
interconnect and computer networking products. Revenues were also reduced
by approximately $6 million due to the impact of foreign currency exchange
rates. All of these factors are expected to continue to affect average
selling prices in 1997.
Domestic revenues, which represented approximately 73% of 1996 total
revenues, increased 10% from 1995. Included in domestic revenues were
export sales (primarily to the Pacific Rim and Latin America) of $61
million, which represented an increase of 41% from 1995. European customer
revenues increased 16% from 1995, and increased 21% in local currency. The
acquisition of Pope was the primary reason for this increase in European
revenues. Canadian revenues decreased 11% from 1995, with translation
having a minimal impact on revenues. This decrease was the result of the
weak Canadian economy and the Company's decision to exit the residential
building wire market and convert capacity to more profitable product lines.
European and Canadian revenues represented 21% and 6% of 1996 total
revenues, respectively.
Costs, Expenses and Earnings
The following table sets forth information comparing the 1996 components of
earnings with 1995.
<TABLE>
<CAPTION>
% Increase
1996 Compared
1996 1995 with 1995
(in thousands, except % data)
<S> <C> <C> <C>
Gross profit $168,379 $152,096 10.7%
As a percent of revenues 25.2% 25.0%
Operating earnings $94,417 $79,602 18.6%
As a percent of revenues 14.1% 13.1%
Income before income taxes $90,920 $75,667 20.2%
As a percent of revenues 13.6% 12.4%
Net income $55,234 $46,227 19.5%
As a percent of revenues 8.3% 7.6%
</TABLE>
Four bar charts depicting revenue (in millions) in the United States,
Canada, Europe, and Export sales are represented for the years 1996, 1995,
and 1994. Data from these graphs are shown below:
<TABLE>
<CAPTION>
1996 1995 1994
<S> <C> <C> <C>
United States $ 424.6 $ 397.8 $ 330.9
Canada 40.9 45.8 40.0
Europe 124.5 107.4 36.8
Export 77.5 57.6 32.0
</TABLE>
27 <PAGE>
<PAGE>
The revenue growth in 1996 primarily caused the increase in gross profit.
The improvement in gross profit as a percent of revenues resulted from
productivity gains at the Company's European facility and the impact of
lower copper and other raw material costs. These improvements were
partially offset by pricing reductions.
The increase in gross profit led to higher operating earnings during the
year. This increase was partially offset by the additional selling, general
and administrative costs associated with the acquired operations and a $0.5
million charge relating to the shutdown of the Apple Creek, Ohio facility.
There will be approximately $0.6 million of additional costs incurred in
the first half of 1997 as the Company transfers production to other
facilities. Operating earnings as a percent of revenues increased from 1995
due primarily to savings from the consolidation of the Company's operations
in Europe, higher volumes and ongoing cost reduction efforts.
Income before income taxes increased due to growth in operating earnings
and a reduction of interest expense in 1996 by $0.4 million, or 11%.
Interest expense declined during 1996 as lower interest rates more than
offset the impact of increased debt levels associated with the Company's
acquisitions and elevated working capital levels. Average debt outstanding
during 1996 and 1995 was $82 million and $75 million, respectively. The
Company's average daily interest rate was 4.9% in 1996 compared with 5.7%
in 1995.
The Company's effective tax rate increased from 38.9% in 1995 to 39.2% in
1996.
Results of Operations 1995 Compared With 1994
Revenues
Belden's revenues for the year ended December 31, 1995 were $608.6 million
compared with $439.7 million in 1994, an increase of 38%. The following
table shows the components of the 38% increase in the Company's 1995
revenues in each of Belden's four served markets.
% Increase
% of Total in 1995 Revenues
1995 Revenues Compared with 1994
Computer 34% 21%
Audio/video 25 61
Industrial 16 28
Electrical 25 54
The Company acquired AEC on March 23, 1995, and Pope on April 3, 1995. AEC
and Pope added $103.7 million to 1995 revenues.
Three bar charts depicting gross profit margin, operating earnings margain,
and net income margin as a percent of revenues are represented for the
years 1996, 1995, and 1994. Data from these graphs are shown below:
<TABLE>
<CAPTION>
1996 1995 1994
<S> <C> <C> <C>
Gross Profit Margin 25.2 % 25.0 % 27.5 %
Operating Earnings Margin 14.1 13.1 14.9
Net Income Margin 8.3 7.6 8.7
</TABLE>
28 <PAGE>
<PAGE>
The acquisition of Pope and an increase in demand for the Company's
products generated the increase in computer market revenues. Excluding the
acquisition, revenues in this market increased 10% compared with 1994.
Growth in the networking of computers, workstations and servers, which
resulted in increased sales of the Company's high-performance twisted pair
products, was the primary cause of this increase. During 1995, an
industry-wide shortage of Teflon FEP, a raw material used in certain
computer networking cables, constrained growth in the computer market. The
Company took actions to reduce the effects of the shortage through
manufacturing design changes, which resulted in using less Teflon FEP per
foot of cable.
A large portion of the growth in audio/video market revenues in 1995
resulted from the addition of revenues from Pope. Excluding the effect of
the Pope acquisition, revenue growth was 22% during 1995 in this market.
Increased demand for the Company's CATV coaxial cable and other broadcast
products generated this growth. The rate of growth in U.S. CATV revenues
slowed during the second half of the 1995 because of uncertainties
regarding telecommunication network architectures and the
telecommunications legislation, that was enacted in early 1996. This
slowdown was partially offset by international CATV growth as the Company
realized the benefits of deploying additional sales personnel throughout
the world.
Continued strong capital investment by manufacturers, market penetration by
the Company, including the expansion of industrial distribution
representation, and the acquisition of Pope, resulted in revenue growth for
the Company's industrial products. Excluding the Pope acquisition,
industrial revenues increased 25%.
The acquisitions of Pope and AEC accounted for most of the growth in
electrical market revenues in 1995. Excluding these acquisitions, revenues
increased 9% for the year in this market. Increased demand for the
Company's electrical cords used on power tools, appliances and other
electrical equipment, and price increases (primarily in Canada) to recover
higher costs of copper were the major reasons for this increase.
Increased prices during 1995 designed to recover the higher costs of
copper, Teflon FEP and other raw materials were generally offset by
competitive price reductions taken on certain products in the computer
interconnect and the industrial signal and control markets. As a result,
average prices for 1995 were only slightly higher than average prices in
1994.
Domestic revenues, which represented approximately 72% of 1995 total
revenues, increased 22% from 1994. Included in domestic revenues were
export sales (primarily to the Pacific Rim and Latin America) of $43
million, which represented an increase of 35% from 1994. European and
Canadian customer revenues increased 231% and 14%, respectively. Excluding
the impact of foreign currency translation, European and Canadian revenues
increased 239% and 15%, respectively. The acquisition of Pope was the
primary cause of revenue growth in Europe. Excluding the acquisition,
European revenues increased 1%, but decreased 10% in local currencies. The
decrease in local currency revenues was primarily due to a drop in demand
for a European-sourced computer cable assembly. European and Canadian 1995
revenues represented 20% and 8% of total 1995 revenues, respectively.
Three bar charts depicting the percent increase compared with the prior
year for gross profit, operating earnings, and net income are represented
for the years 1996, 1995, and 1994. Data from these graphs are shown
below:
<TABLE>
<CAPTION>
1996 1995 1994
<S> <C> <C> <C>
Gross Profit 10.7 % 25.7 % 16.1 %
Operating Earnings 18.6 21.9 19.3
Net Income 19.5 21.2 20.9
</TABLE>
29 <PAGE>
<PAGE>
Costs, Expenses and Earnings
The following table sets forth information comparing the 1995 components of
earnings with 1994.
<TABLE>
<CAPTION>
% Increase
1995 Compared
1995 1994 with 1994
(in thousands, except % data)
<S> <C> <C> <C>
Gross profit $152,096 $120,965 25.7%
As a percent of revenues 25.0% 27.5%
Operating earnings $79,602 $65,318 21.9%
As a percent of revenues 13.1% 14.9%
Income before income taxes $75,667 $62,743 20.6%
As a percent of revenues 12.4% 14.3%
Net income $46,227 $38,126 21.2%
As a percent of revenues 7.6% 8.7%
</TABLE>
Higher revenues generated the increase in gross profit. Gross profit as a
percent of revenues declined from 1994 due to the inclusion of the less
profitable Pope and AEC operations and from increases in copper, Teflon
FEP and other raw material costs. The average monthly cost of copper, the
Company's largest raw material component, increased 26% from 1994. A slight
increase in average prices and the Company's ability to leverage fixed
production costs over higher revenues partially tempered this decline in
gross profit as a percent of revenues.
The increase in gross profit led to higher operating earnings during the
year. This increase was partially offset by an increase in selling, general
and administrative costs due primarily to the Pope and AEC acquisitions.
Operating earnings as a percent of revenues for the year decreased from
1994 as a result of the decline in gross profit as a percent of revenues.
This decrease was partially offset by revenue growth at a greater rate than
the rate of increases in selling, general and administrative costs,
excluding the effect of acquisitions.
Income before income taxes increased due to the increase in operating
earnings. Higher interest costs associated with higher interest rates and
debt levels adversely affected this increase in operating earnings. Debt
levels in 1995 increased as a result of the Company's acquisitions of Pope
and AEC and the purchase by the Company of 275,000 shares of its common
stock. These shares were later reissued under the Company's Employee Stock
Purchase Plan. Average debt outstanding during 1995 and 1994 was $75
million and $58 million, respectively. The Company's average daily interest
rate was 5.7% in 1995 compared with 4.9% in 1994.
The Company's effective tax rate decreased from 39.2% in 1994 to 38.9% in
1995.
A bar chart depicting revenues per employee (in thousands) is represented
for the years 1996, 1995, and 1994. Data from this graph is shown below:
<TABLE>
<CAPTION>
1996 1995 1994
<S> <C> <C> <C>
Revenues Per Employee (in thousands) $ 159 $ 160 $ 157
</TABLE>
30 <PAGE>
<PAGE>
Financial Condition
Liquidity and Capital Resources
The Company has a $200 million multicurrency variable rate bank revolving
credit agreement (Credit Agreement) with a group of seven banks. The Credit
Agreement is unsecured and expires in November 2001. At December 31, 1996,
the Company had $157 million available under the Credit Agreement. In
addition, the Company has unsecured, uncommitted arrangements with three
banks under which it may borrow up to $65 million at prevailing interest
rates. At December 31, 1996, the Company had $36 million available under
these uncommitted arrangements. The Company expects that cash provided by
operations and borrowings available under the Credit Agreement will provide
it with sufficient liquidity to meet its operating needs and fund its
normal dividends and anticipated capital expenditures.
During 1996, the Company reduced debt by $7 million, in spite of additional
borrowings to finance the acquisition of Intech and to purchase 100,000
shares of common stock. As a result, the Company's debt to total
capitalization ratio improved from 38.2% at December 31, 1995 to 28.5% at
the end of 1996. Subsequent to the end of 1996, the Company purchased
substantially all of the assets of the Alpha Wire Division (Alpha) of Alpha
Wire Corporation for approximately $70 million. The Company financed the
acquisition utilizing funds available under the Credit Agreement.
Working Capital
During 1996, operating working capital (defined as receivables and
inventories less payables and accrued liabilities, excluding the effect of
exchange rate changes) increased $19 million. This increase resulted
primarily from increases in receivables associated with higher revenues and
decreases in accounts payable and accrued liabilities primarily associated
with spending related to acquisition restructuring projects.
During 1995, operating working capital increased $19 million. This
increase resulted from planned increases in inventories to support the
Company's current and future growth and increases in receivables associated
with higher revenues. These increases in working capital components were
partially offset by increases in income taxes payable due to timing of
estimated tax payments and in accounts payable and accrued liabilities to
support the higher revenues.
Capital Expenditures and Commitments
Capital expenditures currently planned for 1997, as well as actual
expenditures for 1996 and 1995 are as follows:
1997 1996 1995
Plan Actual Actual
(in millions)
Modernization and enhancement $ 11 $ 6 $ 6
Capacity expansion 5 10 12
Other 11 10 4
---- ----- -----
$ 27 $ 26 $ 22
Three bar charts depicting leverage (debt to total capitalization), cash
flow from operations (in millions), and capital expenditures ( in millions)
are represented for the years 1996, 1995, and 1994. Data from these graphs
are shown below:
<TABLE>
<CAPTION>
1996 1995 1994
<S> <C> <C> <C>
Leverage (Debt to Total Capitalization) 28.5 % 38.2 % 28.5 %
</TABLE>
____________________________________________________________________________
<TABLE>
<CAPTION>
1996 1995 1994
<S> <C> <C> <C>
Cash Flow From Operations (in millions) $ 58.2 $ 42.8 $ 48.5
</TABLE>
_______________________________________________________________________________
<TABLE>
<CAPTION>
Capital Expenditures (in millions)
1996 1995 1994
<S> <C> <C> <C>
Modernization & Enhancement $ 6 $ 6 $ 7
Capacity Expansion 10 12 3
Other 10 4 3
______ _____ _____
Capital Expenditures $ 26 $ 22 $ 13
</TABLE>
31 <PAGE>
<PAGE>
Capital spending planned for 1997 is primarily for the implementation of an
integrated business information system and the modernization and
enhancement of existing equipment to achieve planned cost reductions.
Spending in 1996 and 1995 was primarily for machinery and equipment to
increase the production capacity of CATV coaxial cable and twisted pair
wire.
Effects of Inflation
During the years presented, inflation has had a relatively minor effect on
the Company's results of operations. In recent years, the U.S. rate of
inflation has been relatively low. In addition, because the Company's
inventories are valued primarily on the LIFO method, current inventory
costs are matched against current sales so that increases in cost are
reflected in earnings on a current basis.
Environmental Remediation
The cost of environmental remediation and compliance has generally not been
an item of material expense for Belden. In 1990, in connection with the
shutdown of its manufacturing facility in Shrewsbury, Massachusetts, the
Company recorded an environmental accrual totaling $1.6 million. The
amounts expensed in 1996, 1995 and 1994 with respect to environmental
remediation were not material. The Company has been identified as a
potentially responsible party with respect to five sites designated for
cleanup under the Comprehensive Environmental Response, Compensation and
Liability Act or similar state laws.. Belden does not own or operate any of
these waste sites. Although estimates of cleanup costs have not yet been
completed for most of these sites, the Company believes that, based on its
review and other factors, including its estimated share of the waste volume
at the sites, the existence of other financially-viable,
potentially-responsible parties and the anticipated nature and scope of the
cleanups, the costs to the Company relating to these sites will not have a
material adverse effect on its results of operations, financial condition,
or cash flows.
Forward - Looking Statements
Certain statements in this Annual Report are forward-looking statements
under the Private Securities Litigation Reform Act of 1995. These
statements are subject to various risks and uncertainties, many of which
are outside the control of the Company, such as the level of market demand
for the Company's products, competitive pressures, the ability to achieve
reductions in costs and to continue to integrate acquisitions, price
fluctuations of materials and the potential unavailability thereof, foreign
currency fluctuations, technological obsolescence, and other specific
factors discussed in the Company's Form 10-K and other Securities and
Exchange Commission filings. This information contained in this Annual
Report represents the Company's best judgment at the date of this report
based on information to reflect developments or information obtained after
the date of this report and disclaims any legal obligation to do so.
32 <PAGE>
<PAGE>
The Board of Directors and Shareholders
Belden Inc.
We have audited the accompanying consolidated balance sheets of Belden Inc.
as of December 31, 1996 and 1995, and the related consolidated statements
of income, stockholders' equity 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,
e v i dence 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 Belden
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.
/s/ Ernst & Young
St. Louis, Missouri
January 21, 1997
33<PAGE>
<PAGE>
BELDEN INC.
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
December 31,
1996 1995
(in thousands, except par value and number of shares)
ASSETS
Current assets:
<S> <C> <C>
Cash and cash equivalents $ 1,795 $ 750
Receivables, less allowance for doubtful accounts
of $513 at 1996 and $847 at 1995 106,514 93,931
Inventories 73,785 67,961
Deferred income taxes 6,287 6,906
Other 2,552 3,616
Total current assets 190,933 173,164
Property, plant and equipment, less accumulated
depreciation 151,934 143,648
Intangibles, less accumulated amortization 28,712 15,862
Other assets 66 113
$371,645 $332,787
LIABILITIES AND STOCKHOLDERS EQUITY
Current liabilities:
Accounts payable and accrued liabilities 78,086 $ 78,847
Income taxes payable 4,649 4,399
Total current liabilities 82,735 83,246
Long-term debt 71,630 81,458
Postretirement benefits other than pensions 17,430 18,555
Deferred income taxes 10,592 8,014
Other long-term liabilities 9,551 9,612
Stockholders equity:
Preferred stock, par value $.01 per share, 25,000,000 shares
authorized, no shares outstanding - -
Common stock, par value $.01 per share, 100,000,000 shares
authorized 26,137,882 and 26,114,978 shares outstanding
at 1996 and 1995, respectively 261 261
Additional paid-in capital 51,443 51,034
Retained earnings 133,739 83,717
Translation component (4,460) (3,110)
Treasury stock, at cost 52,592 shares at 1996 (1,276) -
Total stockholders equity 179,707 131,902
$371,645 $332,787
</TABLE>
See accompanying notes.
1996 Belden Inc. Annual Report 34 <PAGE>
<PAGE>
BELDEN INC.
CONSOLIDATED INCOME STATEMENTS
<TABLE>
<CAPTION>
Years Ended December 31,
1996 1995 1994
(in thousands, except per share amounts)
<S> <C> <C> <C>
Revenues $667,425 $608,608 $439,699
Cost of sales 499,046 456,512 318,734
Gross profit 168,379 152,096 120,965
Selling, general and administrative expenses 73,962 72,494 55,647
Operating earnings 94,417 79,602 65,318
Interest expense 3,497 3,935 2,575
Income before income taxes 90,920 75,667 62,743
Income taxes 35,686 29,440 24,617
Net income $ 55,234 $ 46,227 $ 38,126
Net income per common share $ 2.11 $ 1.76 $ 1.46
See accompanying notes.
</TABLE>
1996 Belden Inc. Annual Report 35 <PAGE>
<PAGE>
BELDEN INC.
CONSOLIDATED CASH FLOW STATEMENTS
<TABLE>
<CAPTION>
Years Ended December 31,
1996 1995 1994
(in thousands)
Cash flows from operating activities:
<S> <C> <C> <C>
Net income $55,234 $ 46,227 $38,126
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 16,121 14,246 10,337
Amortization 1,465 1,687 1,637
Deferred income taxes 3,197 (1,428) (590)
Changes in operating assets and liabilities (*):
Receivables (9,155) (14,864) (8,770)
Inventories (1,597) (11,317) 5,066
Accounts payable and accrued liabilities (8,978) 2,910 8,838
Income taxes payable 433 3,908 (5,380)
Other assets and liabilities, net 1,492 1,477 (723)
Net cash provided by operating activities 58,212 42,846 48,541
Cash flows from investing activities:
Capital expenditures (26,100) (21,796) (13,346)
Cash used to acquire businesses (18,050) (59,789) -
Proceeds from sales of property, plant and equipment 209 167 1,530
Net cash used for investing activities (43,941) (81,418) (11,816)
Cash flows from financing activities:
Net borrowings (payments) under long-term
credit facility and credit agreements (7,101) 45,846 (30,723)
Purchase of treasury stock (2,425) (7,150) -
Exercise of stock options 1,558 533 53
Cash dividends paid (5,212) (5,215) (3,909)
Net cash provided by (used for) financing
activities (13,180) 34,014 (34,579)
Effect of exchange rate changes on cash and
cash equivalents (46) 608 148
Increase (decrease) in cash and cash equivalents 1,045 (3,950) 2,294
Cash and cash equivalents, beginning of year 750 4,700 2,406
Cash and cash equivalents, end of year $ 1,795 $ 750 $ 4,700
(*) Net of the effects of exchange rate changes and acquired businesses.
See accompanying notes.
</TABLE>
1996 Belden Inc. Annual Report 36 <PAGE>
<PAGE>
BELDEN INC.
CONSOLIDATED STOCKHOLDERS' EQUITY STATEMENTS
<TABLE>
<CAPTION>
Common Stock Paid-in Retained Translation Treasury Stock
Shares Amount Capital Earnings Component Shares Amount Total
(in thousands)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance at December 31, 1993 26,012 $260 $53,025 $9,792 $(2,613) - - $60,464
Translation adjustment (882) (882)
Issuance of common stock for:
Retirement Savings Plan 57 1 1,052 1,053
Stock options 4 - 53 53
Cash dividends ($.20 per share) (5,213) (5,213)
Net income 38,126 38,126
Balance at December 31, 1994 26,073 261 54,130 42,705 (3,495) - - 93,601
Translation adjustment 385 385
Purchase of treasury stock (275) (7,150) (7,150)
Issuance of common stock for:
Stock options 38 - 533 533
Employee Stock Purchase Plan 4 - (3,629) 275 7,150 3,521
Cash dividends ($.20 per share) (5,215) (5,215)
Net income 46,227 46,227
Balance at December 31, 1995 26,115 261 51,034 83,717 (3,110) - - 131,902
Translation adjustment (1,350) (1,350)
Purchase of treasury stock (100) (2,425) (2,425)
Issuance of common stock for
stock options 23 - 409 47 1,149 1,558
Cash dividends ($.20 per share) (5,212) (5,212)
Net income 55,234 55,234
Balance at December 31, 1996 26,138 $261 $51,443 $133,739 $(4,460) (53) $(1,276) $179,707
</TABLE>
1996 Belden Inc. Annual Report 37 <PAGE>
<PAGE>
Notes to Consolidated Financial Statements
Note 1: Description of Business
Incorporated in 1993, Belden Inc. (the Company) is a leader in the design
and manufacture of wire, cable and cord products for the computer,
audio/video, industrial and electrical markets. The Company was previously
an unincorporated operating division of Cooper Industries, Inc. (Cooper),
until October 1993, when 23.5 million shares of Belden Inc. common stock
were sold to the public in an initial public offering. An additional 2.5
million shares of common stock, which was originally retained by Cooper,
have all been sold to the public as of December 31, 1996.
Note 2: Summary of Significant Accounting Policies
Basis of Presentation
The accompanying consolidated financial statements include Belden and all
its subsidiaries. All significant intercompany accounts and transactions
are eliminated in consolidation.
Cash and Cash Equivalents
Cash equivalents consist of short-term, highly liquid investments with a
maturity of three months or less.
Inventories
Inventories are carried at cost or, if lower, market value. On the basis of
current costs, 72% of inventories in 1996 and 67% in 1995 were carried on
the last-in, first-out (LIFO) method. The remaining inventories were
carried on the first-in, first-out (FIFO) method.
Property, Plant and Equipment
Property, plant and equipment are recorded at cost and depreciation is
provided over the estimated useful lives of the related assets using
primarily the straight-line method. This method is applied to asset
accounts which in general have the following lives: buildings 10 to 40
years and machinery and equipment 5 to 12 years.
Intangibles
Intangibles consist primarily of goodwill related to businesses acquired,
which are being amortized over 40 years using the straight-line method. On
a periodic basis, the Company estimates the future undiscounted cash flows
of the businesses to which goodwill relates in order to ensure that the
carrying value of goodwill has not been impaired. Other intangibles, which
are recorded at cost, are being amortized over their estimated useful lives
using the straight-line method.
Income Taxes
Income taxes are provided based on earnings reported for financial
statement purposes. The provision for income taxes differs from the amounts
currently payable due to the recognition of revenues and expenses in
different periods for income tax and financial statement purposes. Income
taxes are provided as if operations in all countries, including the United
States, were stand-alone businesses filing separate tax returns.
38 <PAGE>
Research and Development
Research and development expenditures are charged to expense as incurred.
Expenditures for research and development sponsored by the Company were
$8,656,000, $8,070,000 and $5,791,000 for 1996, 1995, and 1994,
respectively.
Environmental Remediation and Compliance
Environmental remediation costs are accrued, except to the extent costs can
be capitalized, based on estimates of known environmental remediation
exposures. Environmental compliance costs include maintenance and operating
costs with respect to pollution control facilities and cost of ongoing
monitoring programs. Such costs are expensed as incurred. Capitalized
environmental costs are depreciated generally utilizing a 15-year life.
Earnings per Share
Earnings per share is computed by dividing net income by the weighted
average number of common shares and, where dilutive, common equivalent
shares outstanding. Shares used in the computation totaled 26,236,000,
26,247,000, and 26,127,000 in 1996, 1995, and 1994, respectively.
Futures Contracts
The Company enters into futures contracts to hedge raw material purchases,
principally copper, with the objective of managing gross margin risk due to
market fluctuations. Any gains or losses resulting from changes in the
price of the futures contracts are included as part of the inventory cost
when realized.
Foreign Currency Exposure Management
The Company enters into various transactions designed to manage foreign
currency exposure. The Company is subject to transaction exposures that
arise from foreign exchange rate movements between the date foreign
currency transactions are recorded (e.g., export purchases and sales) and
the date they are consummated (e.g., cash disbursements and receipts in
foreign currencies). The Company sometimes hedges specific transaction
exposures by entering into forward contracts, which typically do not exceed
one year. Gains and losses on those forward contracts from exchange rate
movements offset losses and gains on the transactions being hedged.
The Company sometimes enters into forward contracts to hedge a portion of
anticipated export sales, primarily intercompany, within the next 12
months. The dates of the forward contracts are designated to match the
dates of the anticipated cash receipts of the hedged export sales. Gains
and losses on the forward contracts from exchange rate movements offset the
losses and gains on the portion of the export sales hedged.
As a result of having various foreign operations, the Company is exposed to
the effect of exchange rate movements on the U.S. dollar value of
anticipated cash flows of its foreign operations, which will be remitted to
the U.S. The Company sometimes utilizes a natural hedge to mitigate this
exposure by denominating a portion of the Company's borrowing in the same
currency as the currency of the anticipated cash flow of its foreign
operations. The foreign currency denominated cash flow when remitted, can
be used to reduce the foreign currency borrowings.
39 <PAGE>
<PAGE>
Use of Estimates in the Preparation of the Financial Statements
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and reported amounts of revenues and expenses during
the reporting period. Actual results could differ from those estimates.
Note 3: Acquisitions
During 1996 and 1995, the Company acquired the entities described below,
which were accounted for under the purchase method of accounting.
Accordingly, the purchase price was allocated to the net assets acquired
based on their estimated fair market value. Operating results of the
acquisitions are included in the Company's consolidated results since their
respective acquisition dates.
On December 3, 1996, the Company purchased substantially all of
the assets of Intech Cable, Inc. (Intech). Intech designs,
manufactures and markets specialty wire and cable for a variety
of markets, including the telecommunications and industrial
markets, and is located in Hudson, Massachusetts.
On April 3, 1995, the Company acquired all of the outstanding
shares of Pope Cable and Wire B.V. (Pope), a wholly-owned
subsidiary of Netherlands Philips Bedrijven B.V. (Philips). Pope
is engaged primarily in the design and manufacture of electronic
and electrical wire and cable and is located in Venlo, The
Netherlands. Pope's products primarily serve the television,
telecommunications, electrical and data communications markets in
Europe. The consideration paid for the stock of Pope consisted of
80,652,000 Dutch guilders ($52,456,000 based on the exchange rate
in effect on the date of the acquisition).
On March 23, 1995, the Company purchased substantially all of the
assets of American Electric Cordsets (AEC). AEC designs,
manufacturers and markets electrical cords for a variety of
markets.
Note 4: Subsequent Event
On January 8, 1997, the Company purchased substantially all of the assets
of the Alpha Wire Division (Alpha) of Alpha Wire Corporation for cash of
approximately $70 million. The Company financed the acquisition utilizing
its funds available under its existing Credit Agreement. Alpha designs, and
markets specialty wire and cable for a variety of markets, including the
computer interconnect, industrial and electrical markets. Alpha, located
in Elizabeth, New Jersey, had revenues in 1996 of approximately $51
million. The acquisition will be accounted for under the purchase method of
accounting. Accordingly, the purchase price will be allocated to the net
assets acquired based on their estimated fair market value. On a
preliminary basis, the Company expects to record approximately $43 million
of goodwill with respect to the Alpha acquisition that will be amortized
over 40 years using the straight-line method. Alpha's operating results
will be included in the Company's consolidated operating results beginning
January 9, 1997.
40 <PAGE>
<PAGE>
<TABLE>
<CAPTION>
Note 5: Inventories
December 31,
1996 1995
(in thousands)
<S> <C> <C>
Raw materials $ 18,075 $ 17,449
Work-in-process 17,599 19,374
Finished goods 49,029 46,236
Perishable tooling and supplies 3,965 3,512
88,668 86,571
Excess of current standard
costs over LIFO costs (12,700) (16,775)
Other (2,183) (1,835)
$ 73,785 $ 67,961
</TABLE>
<TABLE>
<CAPTION>
Note 6: Property, Plant and Equipment and Intangibles
December 31,
1996 1995
(in thousands)
<S> <C> <C>
Property, plant and equipment:
Land and land improvements $ 10,045 $ 10,402
Buildings 58,710 57,672
Machinery and equipment 206,264 187,139
Construction in process 9,898 8,402
284,917 263,615
Accumulated depreciation (132,983) (119,967)
$ 151,934 $ 143,648
Intangibles:
Goodwill $ 31,206 $ 16,460
Other 8,708 8,853
39,914 25,313
Accumulated amortization (11,202) (9,451)
$ 28,712 $ 15,862
</TABLE>
<TABLE>
<CAPTION>
Note 7: Accounts Payable and Accrued Liabilities
December 31,
1996 1995
(in thousands)
<S> <C> <C>
Trade accounts $ 47,344 $ 43,743
Payroll and related taxes 7,415 12,150
Employee stock purchase plan and
employee benefit accruals 5,370 6,269
Acquisitions restructuring costs 3,860 7,406
Payable for acquired businesses 5,095 -
Other (individual items less than
5% of total current liabilities) 9,002 9,279
$ 78,086 $ 78,847
</TABLE>
41 <PAGE>
<PAGE>
Note 8: Long-term Debt and Other Borrowing Arrangements
Long-term debt includes $42,542,000 and $50,548,000 at December 31, 1996
and 1995, respectively, of loans outstanding under the variable-rate bank
revolving credit agreement (Credit Agreement). The Credit Agreement
provides for an aggregate $200,000,000 unsecured, multicurrency revolving
credit facility expiring in November 2001. Loans under the Credit Agreement
can be advanced by the banks either based on their commitments (committed
loans) or their offers which have been accepted by the Company under a
special bidding procedure (bid loans). Committed loans accrue interest at
the option of the Company at LIBOR plus 0.235% to 0.500%, or the higher of
the prime rate or the federal funds rate plus 0.500%. Bid loans accrue
interest at prevailing interest rates. A facility fee of 0.090% to 0.250%
per annum is charged on the aggregate $200,000,000 credit. The effective
interest rate was 5.73% at December 31, 1996. The Credit Agreement requires
the Company to comply with certain financial covenants, including
maintenance of minimum stockholders' equity, a maximum leverage ratio and
limitations on the sale or encumbrance of assets. In addition, as of
December 31, 1996 and 1995, the Company had borrowings of $29,088,000 and
$30,910,000, respectively, related to unsecured, uncommitted arrangements
with three banks under which it may borrow up to $65,000,000 at prevailing
interest rates. The effective interest rate was 3.25% at December 31, 1996.
At December 31, 1996 and 1995, these borrowings were reclassified to
long-term, debt reflecting the Company's intention and ability to refinance
the amounts during the next year through either continued short-term
borrowings or utilizing the Credit Agreement.
Total interest paid during 1996, 1995 and 1994 was $3,550,000, $4,046,000
and $2,667,000, respectively.
Note 9: Retirement Plans
Substantially all employees are covered by defined benefit or defined
contribution pension plans maintained by the Company. The Company's defined
benefit plans include a noncontributory cash balance plan for its domestic
employees and a final pay pension plan and an early retirement plan for its
Dutch employees. Successor-defined benefit plans for the Dutch employees
were established in 1995 in conjunction with the Pope acquisition. Pension
obligations and related assets were transferred from plans previously
maintained by Philips to these successor plans. Annual contributions to
retirement plans equal or exceed the minimum funding requirements of the
Employee Retirement Income Security Act or applicable local regulations.
Benefits provided to employees under defined contribution plans include
cash contributions by the Company based on either hours worked by the
employee or a percentage of the employee's compensation and under a 401(k)
feature, a partial matching of employees' salary deferrals with Company
common stock. For the years ended December 31, 1994, the Company satisfied
$1,053,000 of its matching obligation by issuing common stock.
42 <PAGE>
<PAGE>
Retirement plan expense for the year ended December 31, 1996, 1995 and 1994
is summarized in the following table.
<TABLE>
<CAPTION>
Years Ended December 31,
1996 1995 1994
(in thousands)
<S> <C> <C> <C>
Defined benefit plans:
Service costs (benefits earned
during the year) $ 3,404 $ 2,666 $ 1,536
Interest cost on projected benefit obligation 5,134 4,645 2,761
Actual gain on plan assets (9,127) (8,368) (1,066)
Net amortization and deferral 3,671 3,291 (2,709)
Defined benefit plan expense 3,082 2,234 522
Defined contribution plan expense 5,749 5,347 4,627
$ 8,831 $ 7,581 $ 5,149
</TABLE>
The actuarial present value of benefit obligations and the funded status of
the Company's defined benefit pension plans as of December 31, 1996 and
1995 follow:
<TABLE>
<CAPTION>
December 31,
1996 1995
Plans With Plans With Plans With Plans With
Assets In Accumulated Assets In Accumulated
Excess of Benefits In Excess of Benefits In
Accumulated Excess of Accumulated Excess of
Benefits Assets Benefits Assets
(in thousands)
<S> <C> <C> <C> <C>
Actuarial present value of:
Vested benefit obligation $ (58,939) $ (196) $ (57,151) $ (62)
Accumulated benefit obligation $ (59,745) $ (3,595) $ (58,820) $ (2,498)
Projected benefit obligation $ (76,919) $ (5,664) $ (74,385) $ (4,468)
Assets at fair value 74,734 - 70,426 --
Projected benefit obligation
in excess of plan assets (2,185) (5,664) (3,959) (4,468)
Items not yet recognized in earnings:
Unrecognized net (gain)/loss (312) 727 (1,277) (75)
Unamortized transition asset (676) - (902) --
Unrecognized prior service cost 15 (36) 17 (38)
Pension liability at end of year $ (3,158) $ (4,973) $ (6,121) $ (4,581)
</TABLE>
43 <PAGE>
<PAGE>
Assumptions used in determining the actuarial present value of benefit
obligations as of December 31, 1996, 1995 and 1994 are summarized below.
<TABLE>
<CAPTION>
Computational Assumptions
Net Pension Cost Projected Benefit
Years Ended Obligation at
December 31, December 31,
1996 1995 1994 1996 1995
<S> <C> <C> <C> <C> <C>
Discount rate:
United States 7.0% 8.0% 7.5% 7.0% 7.0%
The Netherlands 6.5% 7.0% -- 6.5% 6.5%
Rate of increase in compensation levels:
United States 4.5% 4.5% 4.5% 4.5% 4.5%
The Netherlands 4.0% 4.0% -- 4.0% 4.0%
Expected long-term rate of return on assets:
United States 9.0% 9.0% 9.0%
The Netherlands 7.0% 7.0% --
Benefit basis:
United States plans - earnings during career
The Netherlands plans - final pay multiplied by years of service
</TABLE>
The assets of the pension plans are maintained in various trusts and
invested primarily in equity and fixed income securities and money market
funds.
Note 10: Postretirement Benefits Other Than Pensions
The Company sponsors an unfunded postretirement benefit plan (medical and
life insurance benefits) for employees who retired prior to 1989 (as well
as certain other employees who were near retirement and elected to receive
certain benefits). The Company expense and liability for these benefits are
set forth in the following tables.
<TABLE>
<CAPTION>
Components of Net
Periodic Postretirement
Benefit Cost
Years Ended December 31,
1996 1995 1994
(in thousands)
<S> <C> <C> <C>
Service cost (benefits earned during the year) $ 34 $ 88 $ 95
Interest cost on accumulated postretirement
benefit obligation 870 1,214 1,354
Net amortization and deferral (600) (580) (287)
$ 304 $ 722 $ 1,162
</TABLE>
44 <PAGE>
<PAGE>
<TABLE>
<CAPTION>
Accumulated Postretirement
Benefit Obligation (APBO)
at December 31,
1996 1995
(in thousands)
<S> <C> <C>
Retired employees $ 11,970 $ 13,647
Employees eligible to retire 972 942
Other employees 694 1,340
13,636 15,929
Unrecognized net gain(loss) 194 (1,574)
Unrecognized prior service cost 3,600 4,200
$ 17,430 $ 18,555
</TABLE>
Computational assumptions:
Discount rate at December 31, 1996 and 1995 6.5%
Health care cost trend rate 1997 to 2002 8.3% ratable to 4%
Effect of 1% increase in health care cost trend rate:
Increase December 31, 1996 APBO 5%
Increase 1996 expense 14%
Note 11: Income Taxes
Effective October 6, 1993, the Company and Cooper entered into a Tax
Sharing and Separation Agreement (Tax Agreement). Pursuant to the Tax
Agreement, the Company and Cooper made an election in connection with the
initial public offering of the Company's stock under Section 338(h)(10) of
the Internal Revenue Code. The effect of this election was to increase the
tax basis of the Company's assets. This additional basis is expected to
result in increased income tax deductions and accordingly may reduce income
taxes otherwise payable by the Company. Pursuant to the Tax Agreement, the
Company agreed to pay to Cooper the amount of the tax benefit associated
with this additional basis (retaining 10% of the tax benefit associated
with the amortization of the allocated cost of certain intangibles, such as
goodwill) as realized on a quarterly basis, calculated by comparing the
Company's actual taxes to the taxes that would have been owed had the
increase in basis not occurred. The amount required to be paid to Cooper is
subject to certain adjustments if certain business combinations or other
acquisitions involving the Company occur. Except for the retained 10%
benefit, the effect of the Tax Agreement is to put the Company in the same
financial position it would have been in had there been no increase in the
tax basis of the Company's assets.
The effect of the retained 10% benefit upon the income tax provisions
reflected in the accompanying income statements is to reduce these
provisions for the years ended December 31, 1996, 1995 and 1994 by
$773,000, $749,000 and $715,000, respectively.
45 <PAGE>
<PAGE>
<TABLE>
<CAPTION>
Years Ended December 31,
1996 1995 1994
(in thousands)
<S> <C> <C> <C>
Income before income taxes:
U.S. operations $ 80,429 $ 68,974 $ 62,300
Foreign operations 10,491 6,693 443
$ 90,920 $ 75,667 $ 62,743
Income tax expense:
Currently payable:
U.S. federal $ 24,862 $ 22,565 $ 19,818
U.S. state and local 5,895 5,309 4,679
Foreign 1,729 2,995 710
32,486 30,869 25,207
Deferred:
U.S. federal 1,075 (907) (206)
U.S. state and local 267 (225) (52)
Foreign 1,858 (297) (332)
3,200 (1,429) (590)
$ 35,686 $ 29,440 $ 24,617
Effective tax rate reconciliations:
U.S. federal statutory rate 35.0% 35.0% 35.0%
State and local income taxes 4.4 4.4 4.8
Other (0.2) (0.5) (0.6)
Effective tax rate 39.2% 38.9% 39.2%
(*) Total income taxes paid $ 31,247 $ 27,938 $ 30,850
(*) Included in 1996, 1995 and 1994 taxes paid are $11,400,000, $12,000,000
and $25,300,000, respectively, paid to Cooper in accordance with the
Tax Agreement.
</TABLE>
<TABLE>
<CAPTION>
December 31,
1996 1995
(in thousands)
<S> <C> <C>
Components of deferred tax balances:
Deferred tax liabilities:
Plant, equipment and intangibles $ (20,930) $ (19,744)
Deferred tax assets:
Postretirement benefits 10,338 11,026
Reserves and accruals 5,788 6,907
Other 499 703
16,625 18,636
$ (4,305) $ (1,108)
</TABLE>
Deferred income taxes have been established for differences in the basis of
assets and liabilities for financial statement and tax reporting purposes
as adjusted for the Tax Agreement with Cooper.
46 <PAGE>
<PAGE>
Note 12: Stock Compensation Plans
The Company has two forms of stock compensation plans, which include the
Belden Inc. Long-term Incentive Plan (Incentive Plan) and the Belden Inc.
Employee Stock Purchase Plan (Stock Purchase Plan). Under the Incentive
Plan, designated employees of the Company are eligible to receive awards in
the form of stock options, stock appreciation rights, restricted stock
grants and performance shares. An aggregate of 1,300,000 shares was
originally reserved for issuance under the Incentive Plan. As of December
31, 1996, 891,500 stock options have been granted with terms ranging from
five to ten years, vesting in equal amounts on each of the first three
anniversaries of the grant date. Under the Stock Purchase Plan, all full-
time U.S. and Canadian employees receive an option to purchase common stock
at the lesser of 85% of the fair market value on the offering date or 100%
of the fair market value on the exercise date. With respect to the 1993
offering, on December 8, 1995, the Company sold 278,574 shares to 1,303
employees at $12.64 per share. The Company used 275,000 treasury shares and
issued an additional 3,574 shares of stock. With respect to the 1995
offering, at December 31, 1996, 1,187 participating employees had options
to acquire up to 180,308 shares of common stock at the lesser of $20.94 per
share or the market price on the exercise date of December 8, 1997. An
aggregate of 1,021,426 shares of common stock is reserved for issuance
under the Stock Purchase Plan.
The Company continues to account for stock options under Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees"
and has adopted the disclosure-only provisions of SFAS 123, "Accounting for
Stock-Based Compensation". Accordingly, no compensation cost has been
recognized for the stock compensation plans. The effect of applying SFAS
123's fair value method to the Company's stock compensation plan results in
net income and earnings per share that are not materially different from
amounts reported
The following table summarizes the Company's stock option activity and
related information for the years ended December 31, 1996 and 1995:
<TABLE>
<CAPTION>
Years Ended December 31,
1996 1995
Weighted Weighted
Average Average
Exercise Exercise
Options Price Options Price
<S> <C> <C> <C> <C>
Outstanding at beginning
of year 484,107 $16.84 485,789 $16.20
Granted 347,000 30.74 40,500 21.79
Exercised (80,474) 15.40 (40,948) 15.06
Canceled (12,386) 18.13 (1,234) 15.52
Outstanding at end of year 738,247 $23.51 484,107 $16.84
Exercisable at end of year 297,747 $16.49 207,107 $15.86
</TABLE>
The following table summarizes information about fixed stock options
outstanding at December 31, 1996:
<TABLE>
<CAPTION>
Options Outstanding Options Exercisable
Range of Weighted-Average
Exercise Remaining Weighted-Average Weighted-Average
Prices Options Contractual Life Exercise Price Options Exercise Price
<C> <C> <C> <C> <C> <C>
$14 to $19 353,413 2.0 years $16.65 284,913 $16.25
21 to 24 39,834 3.2 21.80 12,834 21.80
29 to 31 345,000 9.2 30.74 - -
$14 to $31 738,247 5.4 years $23.51 297,747 $16.49
</TABLE>
47 <PAGE>
<PAGE>
Note 13: Stockholder Rights Plan
Under a Stockholder Rights Plan adopted in 1995, a dividend of one
Preferred Share Purchase Right was declared for each share of common stock.
Each right, when exercisable, entitles the holder to purchase 1/100th of a
share of the Company's Series A Junior Participating Preferred Stock at a
purchase price of $100. Each 1/100th of a share of Series A Junior
Participating Preferred Stock will be substantially equivalent to one share
of common stock and will be entitled to one vote, voting together with the
shares of common stock. The rights will become exercisable only if, without
the prior approval of the Board of Directors, a person or group of persons
acquires or announces the intention to acquire 15% or more of the common
stock. If the Company is acquired through a merger or other business
combination transaction, each right will entitle the holder to purchase
$200 worth of the surviving company's common stock for $100 (subject to
adjustment). In addition, if a person or group of persons acquires 15% or
more of the common stock, each right not owned by the 15% or greater
shareholder would permit the holder to purchase $200 worth of common stock
for $100 (subject to adjustment). The rights are redeemable, at the option
of the Company, at $.01 per right at any time until ten business days after
a person or group of persons acquires 15% or more of the common stock. The
rights expire on July 18, 2005.
Note 14: Commitments
At December 31, 1996, the Company had copper future contracts of
$12,514,000. These contracts represent approximately two to three months of
the Company's anticipated U.S. requirements. The contracts expire as
follows:
<TABLE>
<CAPTION>
1997 (by quarter)
1 2 3 4
(in thousands)
<S> <C> <C> <C> <C>
Commitments as of December 31, 1996 $6,072 $2,245 $3,538 $659
</TABLE>
Note 15: Leases
Rental expense for operating leases primarily for office space and
machinery and equipment was $4,007,000, $3,436,000 and $2,720,000 in 1996,
1995 and 1994, respectively.
Minimum annual lease payments for noncancellable operating leases in effect
at December 31, 1996 are as follows:
<TABLE>
<CAPTION>
(in thousands)
<C> <C>
1997 $ 3,325
1998 2,491
1999 1,517
2000 501
2001 158
Thereafter 134
Total minimum lease payments $ 8,126
</TABLE>
48 <PAGE>
<PAGE>
Note 16: Concentrations of Credit Risk and Fair Value of Financial
Instruments
Concentrations of Credit Risk
Concentrations of credit risk with respect to trade receivables are limited
due to the wide variety of customers and markets into which the Company's
products are sold, as well as their dispersion across many different
geographic areas. As a result, at December 31, 1996 and 1995, the Company
did not consider itself to have any significant concentrations of credit
risk except for receivables from several operating units of a major
customer of $16,171,000 and $13,997,000, respectively.
Fair Value of Financial Instruments
The Company's financial instruments consist primarily of cash and cash
equivalents, trade receivables, trade payables, debt instruments and
foreign currency forward contracts. At December 31, 1996 and 1995, the book
values of cash and cash equivalents, trade receivables, trade payables and
debt instruments are considered representative of their respective fair
values.
Note 17: Industry Segments, Major Customers and Geographic Information
The Company's operations are conducted within one business segment which
designs, manufactures and markets wire, cable and cord products for the
electronics and electrical markets. Sales to a major customer amounted to
17%, 18% and 22% of consolidated revenues in 1996, 1995 and 1994,
respectively. Translation and transaction gains and losses included in each
year's consolidated income statements were not significant.
Geographic information is set forth in the following table.
<TABLE>
<CAPTION>
United States Canada Europe Eliminations Consolidated
(in thousands)
Year ended December 31, 1996
<S> <C> <C> <C> <C> <C>
Revenues:
Customer $485,621 $40,889 $140,915 $ - $667,425
Affiliate transfers 28,514 14,767 - (43,281) -
Total 514,135 55,656 140,915 (43,281) 667,425
Operating earnings 76,290 1,939 16,256 (68) 94,417
Identifiable assets 308,594 24,486 96,973 (58,408) 371,645
Year ended December 31, 1995
Revenues:
Customer 441,167 45,776 121,665 $ -- 608,608
Affiliate transfers 27,362 12,012 470 (39,844) --
Total 468,529 57,788 122,135 (39,844) 608,608
Operating earnings 68,072 2,142 9,932 (544) 79,602
Identifiable assets 272,524 26,312 94,714 (60,763) 332,787
Year ended December 31, 1994
Revenues:
Customer 362,887 40,001 36,811 -- 439,699
Affiliate transfers 26,375 5,843 -- (32,218) --
Total 389,262 45,844 36,811 (32,218) 439,699
Operating earnings 58,237 1,974 4,656 451 65,318
Identifiable assets 176,004 25,879 10,992 (9,066) 203,809
</TABLE>
49<PAGE>
<PAGE>
Transfers between domestic and international operations, principally
inventory transfers, are charged to the receiving organization at prices
sufficient to recover manufacturing costs.
Export sales to customers of $61,057,000, $43,334,000 and $32,012,000 are
included in United States revenues for 1996, 1995 and 1994, respectively.
Export sales to customers of $16,400,000 and $14,297,000, respectively, are
included in European revenues for 1996 and 1995. Export sales by geographic
region are as follows:
<TABLE>
<CAPTION>
Years Ended December 31,
1996 1995 1994
(in thousands)
<S> <C> <C> <C>
Pacific Rim $ 49,133 $ 37,703 $ 18,145
Latin America 21,400 13,413 8,060
Canada 3,164 3,249 3,463
Other 3,760 3,266 2,344
Total $ 77,457 $ 57,631 $ 32,012
</TABLE>
Note 18: Quarterly Operating Results (unaudited)
<TABLE>
<CAPTION>
1996 (by quarter)
1 2 3 4
(in thousands, except per share amounts)
<S> <C> <C> <C> <C>
Revenues $ 169,275 $ 167,649 $ 159,067 $ 171,434
Gross profit 41,412 41,515 39,783 45,669
Operating earnings 21,674 22,810 23,005 26,928
Net income 12,570 13,316 13,428 15,920
Net income per common share $ 0.48 $ 0.51 $ 0.51 $ 0.61
</TABLE>
<TABLE>
<CAPTION>
1995 (by quarter)
1 2 3 4
(in thousands, except per share amounts)
<S> <C> <C> <C> <C>
Revenues $ 114,085 $ 159,986 $ 156,722 $ 177,815
Gross profit 30,768 38,578 38,266 44,484
Operating earnings 16,327 19,131 19,900 24,244
Net income 9,606 10,854 11,414 14,353
Net income per common share $ 0.37 $ 0.41 $ 0.43 $ 0.55
</TABLE>
50 <PAGE>
<PAGE>
EXHIBIT 21.1
List of Subsidiaries of Belden Inc.
Belden Wire & Cable Company (Incorporated in Delaware)
Belden (Canada) Inc. (Incorporated in Ontario,
Canada)
Belden International, Inc. (Incorporated in Delaware)
Belden Electronics S.a.r.l. (Incorporated in France)
Belden Electronics GmbH (Incorporated in Germany)
Belden UK Limited (Incorporated in the United
Kingdom)
Belden Foreign Sales (Incorporated in Barbados)
Corporation
Belden Holdings, Inc. (Incorporated in Delaware)
Belden Europe B.V. (Incorporated in The
Netherlands)
Belden Wire & Cable B.V. (Incorporated in The
Netherlands)
Grupo Belden Mexicana (Incorporated in Mexico)
S.A. de C.V.
Belden Electronics, (Incorporated in Mexico)
S.A. de C.V.
Belden Brasil Comercial LTDA (Incorporated in Brazil) <PAGE>
<PAGE>
Consent of Independent Auditors
We consent to the incorporation by reference in this Annual Report (Form
10-K) of Belden Inc. of our report dated January 21, 1997, included in the
1996 Annual Report to Shareholders of Belden Inc.
We also consent to the incorporation by reference in the Registration
Statements (Form S-8) pertaining to the Belden Inc. Employee Stock Purchase
Plan (No. 33-66830), the Belden Inc. Employee Long-Term Incentive Plan (No.
33-83154), and the Belden Inc. Non-Employee Director Stock Plan (No. 333-
11071) of our report dated January 21, 1997, with respect to the
consolidated financial statements of Belden Inc. incorporated herein by
reference in this Annual Report (Form 10-K) for the year ended December 31,
1996.
/s/ Ernst & Young LLP
St. Louis, Missouri
March 12, 1997 <PAGE>
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of
BELDEN INC. (the "Company"), does constitute and appoint C. BAKER
CUNNINGHAM, with full power and substitution, his true and lawful attorney
and agent, to do any and all acts and things and to execute any and all
instruments which such attorney and agent may deem necessary or advisable
to enable the company to comply with the Securities Exchange Act of 1934,
as amended, and any rules, regulations and requirements of the Securities
and Exchange Commission in respect thereof, in connection with the
execution and filing of the Annual Report (Form 10-K) of Belden Inc. for
the fiscal year ended December 31, 1996 (the "Annual Report"), including
specifically the power and authority to sign for and on behalf of the
undersigned the name of the undersigned as director of the Company to the
Annual Report or to any amendments thereto filed with the Securities and
Exchange commission and to any instrument or document filed as part of, as
an exhibit to, or in connection with such Annual Report or amendments; and
the undersigned does hereby ratify and conform as his own act and deed all
that such attorney and agent shall do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has subscribed these presents,
this 27th day of February, 1997.
/s/ Lorne D. Bain
Lorne D. Bain <PAGE>
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of
BELDEN INC. (the "Company"), does constitute and appoint C. BAKER
CUNNINGHAM, with full power and substitution, his true and lawful attorney
and agent, to do any and all acts and things and to execute any and all
instruments which such attorney and agent may deem necessary or advisable
to enable the company to comply with the Securities Exchange Act of 1934,
as amended, and any rules, regulations and requirements of the Securities
and Exchange Commission in respect thereof, in connection with the
execution and filing of the Annual Report (Form 10-K) of Belden Inc. for
the fiscal year ended December 31, 1996 (the "Annual Report"), including
specifically the power and authority to sign for and on behalf of the
undersigned the name of the undersigned as director of the Company to the
Annual Report or to any amendments thereto filed with the Securities and
Exchange commission and to any instrument or document filed as part of, as
an exhibit to, or in connection with such Annual Report or amendments; and
the undersigned does hereby ratify and conform as his own act and deed all
that such attorney and agent shall do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has subscribed these presents,
this 26th day of February, 1997.
/s/ Joseph R. Coppola
Joseph R. Coppola <PAGE>
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of
BELDEN INC. (the "Company"), does constitute and appoint C. BAKER
CUNNINGHAM, with full power and substitution, his true and lawful attorney
and agent, to do any and all acts and things and to execute any and all
instruments which such attorney and agent may deem necessary or advisable
to enable the company to comply with the Securities Exchange Act of 1934,
as amended, and any rules, regulations and requirements of the Securities
and Exchange Commission in respect thereof, in connection with the
execution and filing of the Annual Report (Form 10-K) of Belden Inc. for
the fiscal year ended December 31, 1996 (the "Annual Report"), including
specifically the power and authority to sign for and on behalf of the
undersigned the name of the undersigned as director of the Company to the
Annual Report or to any amendments thereto filed with the Securities and
Exchange commission and to any instrument or document filed as part of, as
an exhibit to, or in connection with such Annual Report or amendments; and
the undersigned does hereby ratify and conform as his own act and deed all
that such attorney and agent shall do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has subscribed these presents,
this 26th day of February, 1997.
/s/ Alan E. Riedel
Alan E. Riedel <PAGE>
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of
BELDEN INC. (the "Company"), does constitute and appoint C. BAKER
CUNNINGHAM, with full power and substitution, his true and lawful attorney
and agent, to do any and all acts and things and to execute any and all
instruments which such attorney and agent may deem necessary or advisable
to enable the company to comply with the Securities Exchange Act of 1934,
as amended, and any rules, regulations and requirements of the Securities
and Exchange Commission in respect thereof, in connection with the
execution and filing of the Annual Report (Form 10-K) of Belden Inc. for
the fiscal year ended December 31, 1996 (the "Annual Report"), including
specifically the power and authority to sign for and on behalf of the
undersigned the name of the undersigned as director of the Company to the
Annual Report or to any amendments thereto filed with the Securities and
Exchange commission and to any instrument or document filed as part of, as
an exhibit to, or in connection with such Annual Report or amendments; and
the undersigned does hereby ratify and conform as his own act and deed all
that such attorney and agent shall do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has subscribed these presents,
this 27th day of February, 1997.
/s/ Bernard G. Rethore
Bernard G. Rethore <PAGE>
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a director of
BELDEN INC. (the "Company"), does constitute and appoint C. BAKER
CUNNINGHAM, with full power and substitution, his true and lawful attorney
and agent, to do any and all acts and things and to execute any and all
instruments which such attorney and agent may deem necessary or advisable
to enable the company to comply with the Securities Exchange Act of 1934,
as amended, and any rules, regulations and requirements of the Securities
and Exchange Commission in respect thereof, in connection with the
execution and filing of the Annual Report (Form 10-K) of Belden Inc. for
the fiscal year ended December 31, 1996 (the "Annual Report"), including
specifically the power and authority to sign for and on behalf of the
undersigned the name of the undersigned as director of the Company to the
Annual Report or to any amendments thereto filed with the Securities and
Exchange commission and to any instrument or document filed as part of, as
an exhibit to, or in connection with such Annual Report or amendments; and
the undersigned does hereby ratify and conform as his own act and deed all
that such attorney and agent shall do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has subscribed these presents,
this 26th day of February, 1997.
/s/ Christopher I. Byrnes
Christopher I. Byrnes <PAGE>
<PAGE>
GRAPHIC IMAGE
OF THE BELDEN
LOGO
March 26, 1997
Dear Shareholder:
You are cordially invited to attend the 1997 Annual Meeting to be held
on Thursday, May 1, 1997, in St. Louis, Missouri.
Details of the business to be conducted at the annual meeting are
given in the attached Notice of Annual Meeting and Proxy Statement.
Whether or not you plan to attend, you can be sure your shares are
represented at the meeting by promptly completing and returning your proxy
form in the enclosed envelope.
Sincerely,
/s/ C. Baker Cunningham
C. Baker Cunningham
Chairman of the Board, President
and Chief Executive Officer<PAGE>
<PAGE>
BELDEN INC.
7701 Forsyth Boulevard
Suite 800
St. Louis, Missouri 63105
Notice of Annual Meeting of Shareholders
March 26, 1997
To the Shareholders:
Belden Inc. will hold its 1997 Annual Meeting of Shareholders in the
Lewis & Clark Room of the St. Louis Club, Pierre Laclede Center, 7701
Forsyth Boulevard, 16th Floor, St. Louis, Missouri, on Thursday, May 1,
1997, at 11:00 a.m. C.D.T. for the following purposes:
1. to elect three Class I directors;
2. to approve an amendment to the Company's Long-Term Incentive
Plan to reserve an additional 1,300,000 shares of the
Company's common stock for issuance under the Plan; and
3. to transact any other matters that may properly come before
the meeting.
Shareholders of record at the close of business on March 14, 1997
will be entitled to vote at the meeting.
By order of the Board of Directors,
/s/ Kevin Bloomfield
Kevin Bloomfield
Secretary<PAGE>
<PAGE>
BELDEN INC.
March 26, 1997
PROXY STATEMENT
Annual Meeting of Stockholders
To be held May 1, 1997
This Proxy Statement is furnished in connection with the solicitation
of proxies on behalf of the Board of Directors of Belden Inc. for the 1997
Annual Meeting of Shareholders. Distribution of this Proxy Statement and a
proxy form is scheduled to begin on or about March 26, 1997.
Only record holders of the common stock, $.01 par value, of the
Company at the close of business on March 14, 1997 (the "Record Date") will
be entitled to vote at the Meeting. On February 28, 1997, 26,119,419 shares
of common stock were outstanding and entitled to vote. Each share of common
stock has one vote. For the proposals to be considered, the presence at the
meeting, in person or by proxy, of the holders of a majority of shares of
common stock is necessary to constitute a quorum.
You can ensure that your shares are voted at the meeting by completing
and returning the enclosed proxy form in the envelope provided. Sending in
a proxy will not affect your right to attend the meeting and vote. A
stockholder who gives a proxy may revoke it at any time before it is
exercised by voting in person at the meeting, by submitting another proxy
bearing a later date or by notifying the Inspector of Election in writing
of such revocation.
MATTERS TO COME BEFORE THE MEETING
1 - Election of Three Directors
The directors of the Company are divided into three classes, Class I,
Class II and Class III, with each class serving for a term of three years.
One class stands for election at each annual meeting of stockholders. At
the date of this Proxy Statement, there are three Class II directors whose
term will expire at the 1998 annual meeting, one Class III director whose
term will expire at the 1999 annual meeting and two Class I directors whose
term will expire at this annual meeting. At this meeting, three Class I
directors will be elected for a term expiring at the 2000 annual meeting.
Christopher Byrnes, Joseph R. Coppola, and John R. DallePezze are the Board
of Directors' nominees as Class I directors for election at this meeting.
Messrs. Byrnes and Coppola are current Class I directors. Mr. DallePezze
has not previously served on the Board.
Each nominee has indicated a willingness to serve as director if
elected. Should any nominee be unavailable or unwilling to serve, and if
any other person is nominated, the persons designated on the accompanying
form of proxy will have the discretionary authority to vote or refrain from
voting in accordance with their judgment on such other nominee unless
authority to vote on such matter is withheld.
Nominees for Class I Directors
JOSEPH R. COPPOLA
Chairman and Chief Executive Officer
Giddings & Lewis, Inc.
Chairman -- Compensation Committee
Director since 1993 Age 66 (PHOTO)
Received a B.S. degree in mechanical engineering from the University of
Massachusetts. From 1989, director, and from 1993, Chairman and Chief
Executive Officer of Giddings & Lewis, Inc., a manufacturer of machine
tools and assembly systems. From 1985 to 1993, was Senior Vice President,
Manufacturing Services of Cooper Industries, Inc. ("Cooper"), a
manufacturer of electrical equipment, tools and hardware, and automotive
products.
Director, Coltec Industries Inc., National Exchange Bank.
2 <PAGE>
<PAGE>
CHRISTOPHER I. BYRNES
Dean, School of Engineering and Applied Science
Washington University
Member -- Compensation Committee
Director since 1995 Age 47 (PHOTO)
Received a B.S. degree in mathematics from Manhattan College and M.S. and
Ph.D. degrees in mathematics from the University of Massachusetts. Has
served on the engineering faculty at Arizona State, Harvard, and the Royal
Institute of Technology in Stockholm. Has held visiting appointments in
Austria, France, Germany, Italy, Japan, the Netherlands, Sweden and the
former Soviet Union. Elected Fellow of the Institute of Electrical and
Electronics Engineers and of the Japan Society for the Promotion of
Science. Since 1991, has been Dean of the School of Engineering and
Applied Science of Washington University.
JOHN R. DALLEPEZZE
Chairman of the Board, President and Chief Executive Officer
Holophane Corporation Age 53 (PHOTO)
Received a B.S.E.E. degree from Princeton University and an M.S. degree
from the Massachusetts Institute of Technology. Since October 1989, has
been Director, President and Chief Executive Officer and, since February
1992, Chairman of the Board of the Holophane Corporation, a manufacturer of
lighting fixtures and systems.
Director, Holophane Corporation.
Class II Directors: Term Expiring in 1998
ALAN E. RIEDEL
Chairman
Gardner Denver Machinery, Inc.
Member -- Audit Committee
Director since 1993 Age 66 (PHOTO)
Graduated magna cum laude from Ohio University with a B.A. degree in
government. Received a Juris Doctor degree from Case Western Reserve
University School of Law, where he was elected to the Order of the Coif.
Has completed Harvard Business School's Advanced Management Program.
Received an Honorary Doctor of Laws from Ohio University. Since April 1994,
has served in the position "Of Counsel" to the law firm of Squire, Sanders
& Dempsey and has been Director and Chairman of Gardner Denver Machinery,
Inc., a manufacturer of air compressor products and pumps. Had been Vice
Chairman of Cooper, from April 1992 until April 1994, when he retired. From
1973 to 1992, was Senior Vice President, Administration of Cooper.
Director, Gardner Denver Machinery, Inc., Standard Products Company, and
Arkwright Mutual Insurance Company.
LORNE D. BAIN
Chairman -- Audit Committee
Director since 1993 Age 55 (PHOTO)
Received a B.B.A. degree from St. Edwards University and a Juris Doctor
degree from the University of Texas School of Law and has completed Harvard
Business School's Advanced Management Program. Presently, Managing Director
of Bellmeade Capital Partners, L.L.C. From 1991 to 1996, had been Chairman
and Chief Executive Officer of Sanifill, Inc., an environmental services
company.
BERNARD G. RETHORE
Chairman of the Board, President and Chief Executive Officer
BW/IP, Inc.
Member -- Audit Committee
Director since February 1997 Age 55 (PHOTO)
3 <PAGE>
<PAGE>
Received a B.A. degree in Economics (Honors) from Yale University and an
M.B.A. degree from the Wharton School of the University of Pennsylvania.
Since 1995, has been President , Chief Executive Officer and a Director
and, since February 1997, Chairman of the Board of BW/IP, Inc. , a supplier
of advanced-technology fluid transfer and control equipment, systems and
services. From 1985 to 1995, was Senior Vice President of Phelps Dodge
Corporation and President of Phelps Dodge Industries, its diversified
manufacturing business.
Director, BW/IP, Inc. Maytag Corporation.
Class III Director: Term Expiring in 1999
C. BAKER CUNNINGHAM
Chairman of the Board, President and
Chief Executive Officer
Director since 1993 Age 55 (PHOTO)
Received a B.S. degree in civil engineering from Washington University, an
M.S. degree in civil engineering from Georgia Tech and an M.B.A. from
Harvard Business School. Has been Chairman, President and Chief Executive
Officer of the Company since its incorporation in July 1993. From February
1982 until July 1993, was an Executive Vice President, Operations of
Cooper.
Director, Cooper Cameron Corporation.
Vote Required and Board Recommendation
To be elected, each nominee must receive the affirmative vote of a
majority of the common stock of the Company represented at the Meeting.
The Board of Directors recommends a vote "for" the election of each nominee
to the Board of Directors.
2 - Proposal to Amend the Belden Inc. Long-Term Incentive Plan
In 1994, the stockholders approved the Belden Inc. Long-Term Incentive
Plan ("Incentive Plan"). The stockholders at this annual meeting will be
requested to approve an amendment to the Incentive Plan that increases by
1,300,000 the number of shares that may be granted under the Incentive
Plan. Such approval is necessary in order to retain the ability to award
ISO's (defined below) in excess of 1,300,000 shares. As of March 1, 1997,
308,500 shares of common stock were available for issuance under the
Incentive Plan for future awards. If the amendment is approved, the number
of shares of common stock available for future grants would be 1,608,500.
The Incentive Plan is intended to promote the long-term financial
interests of the Company by aligning employee financial interests with
long-term stockholder value. The Board believes that the number of shares
remaining available for issuance will be insufficient to achieve the
purpose of the Incentive Plan over its 10-year term unless the additional
shares are authorized.
Administration of the Incentive Plan. The Incentive Plan is
administered by the Compensation Committee which is comprised of two or
more non-employee directors of the Company selected by the Board of
Directors. The current members of the Compensation Committee are Messrs.
Joseph R. Coppola and Christopher Byrnes, both non-employee directors. It
is the Board's policy that the Compensation Committee be composed of
outside directors for the purpose of Rule 16b-3 under the Securities
Exchange Act of 1934 and the $1 million compensation deduction limitation
exception under the Internal Revenue Code of 1986, as amended (the "Code").
Subject to the provisions of the Incentive Plan, the Compensation
Committee is authorized to determine who may participate in the Incentive
Plan, the number and types of awards made to each participant and the
terms, conditions and limitations applicable to each award. In addition,
the Compensation Committee has the power to interpret the Incentive Plan
and to adopt such rules and regulations as it may deem necessary or
appropriate for purposes of administering the plan.
4 <PAGE>
<PAGE>
Eligibility and Participation. All employees of the Company and its
subsidiaries who have demonstrated significant management potential or who
have the capacity for contributing in a substantial measure to the
successful performance of the Company, as determined by the Compensation
Committee, are eligible to be participants in the Incentive Plan. As of
the date of this Proxy Statement, approximately 102 employees participate.
Participants may receive one or more awards under the Incentive Plan.
The aggregate fair market value (determined as of the date the option
is granted) of the stock with respect to which incentive stock options are
exercisable for the first time by the optionee in any calendar year (under
the Incentive Plan and any other incentive stock option plan of the Company
and any parent and subsidiary corporation thereof) may not exceed $100,000.
No individual may receive stock options under the Incentive Plan in excess
of 100,000 shares of common stock every other year over the 10-year term of
the Incentive Plan.
Shares Subject to Awards. As initially approved, the Incentive Plan
reserved 1,300,000 shares (subject to adjustment for changes in
capitalization) for the granting of stock options, stock appreciation
rights, restricted stock awards, and performance shares. Such shares may be
treasury shares or authorized but unissued shares. The proposed amendment,
if approved, would increase the number of shares reserved for grant under
the Incentive Plan by 1,300,000 shares to 1,608,500 shares.
If any outstanding options expire or terminate, the shares of common
stock allocable to the unexercised portion of such option may again be
subject to award under the Incentive Plan, subject to certain exceptions.
The Compensation Committee has the discretion to grant either "incentive
stock options" (within the meaning of Section 422 of the Code, ("ISO's"))
or "non-statutory stock options" ("NSO's"). A description of these two
types of stock options appear below under the heading "Federal Income Tax
Consequences."
Grant and Exercise of Options. Each option granted under the
Incentive Plan is to be embodied in a written option agreement, which is
subject to the terms and conditions of the Incentive Plan and which may
contain such other provisions as the Compensation Committee in its
discretion deems advisable.
The price at which shares may be purchased pursuant to an option,
whether an ISO or an NSO, is to be determined by the Compensation
Committee, but in no event may such price be less than the fair market
value of the shares of common stock on the date the option is granted. At
February 28, 1997, the high and low sales prices of the common stock were
$35.875 and $35.625, respectively.
No option will be exercisable after the expiration of ten years from
the date it is granted. The Compensation Committee in its discretion may
provide that an option will be exercisable throughout a ten-year period or
during any shorter period of time commencing on or after the date of grant
of the option and ending on or before the expiration of a ten-year period.
The Compensation Committee may, in its discretion, provide for vesting or
other conditions on exercise of options granted under the Incentive Plan.
Upon exercise, subject to the provisions of the agreement relating to
the option, a participant in the Incentive Plan may pay the option exercise
price of a stock option in cash, shares of common stock, stock appreciation
rights or a combination of the foregoing, or such other consideration as
the Compensation Committee may deem appropriate.
Rights of Participants. No participant has rights as a shareholder
with respect to the shares covered by an award until the date of issuance
of a stock certificate for the shares. The granting of any award by the
Company will not impose any obligation on the Company to employ or continue
to employ any participant. To date, the Compensation Committee has granted
991,500 stock options to employees.
Stock Appreciation Rights. Under the Incentive Plan, the Compensation
Committee may grant stock appreciation rights either in tandem with an
option or alone. Stock appreciation rights granted in tandem with a stock
option may be granted at the same time as the stock option or at a later
time. A stock appreciation right issued in tandem with stock options shall
entitle the participant to receive from the Company an amount payable in
cash, in shares of common stock or a combination of cash and common stock
equal to the positive difference between the fair market value on the date
of exercise of a share of common stock and the grant price, or some lesser
amount as the Compensation Committee determines. The grant of a
freestanding stock appreciation right may be at such price as determined by
5 <PAGE>
<PAGE>
the Committee, provided that such price may not be less than the fair
market value of the common stock on the date of grant. No stock
appreciation right shall be exercisable earlier than six months after
grant. The Compensation Committee has not granted any stock appreciation
rights.
Restricted Stock. Under the Incentive Plan, the Compensation
Committee may grant shares of restricted stock, which are subject to
forfeiture to the Company under such conditions and for such period of time
(not less than one year) as the Compensation Committee may determine. The
Compensation Committee shall determine the conditions or restrictions of
any restricted stock awards, which may include restrictions on
transferability, requirements of continued employment, individual
performance or the Company's financial performance. The Compensation
Committee has not granted any restricted stock awards.
Performance Shares. Under the Incentive Plan, the Compensation
Committee may grant performance shares that are earned only after the
attainment of predetermined performance targets during a performance period
as established by the Compensation Committee. Performance shares are
convertible into common stock, cash or a combination of both as determined
by the Compensation Committee. At the end of the performance cycle, the
Compensation Committee shall determine the number of performance shares
that have been earned on the basis of the Company's performance in relation
to the performance goals. Performance shares may not be sold, transferred,
assigned, pledged or otherwise encumbered so long as such performance
shares remain restricted. The Compensation Committee has not granted any
performance shares.
Stock Options for Nonemployee Directors. Under the Incentive Plan,
each nonemployee director is automatically granted, on the day following
each annual meeting of shareholders, an option to purchase 1,000 shares of
common stock. The option exercise price is equal to 100% of the fair
market value (as defined in the Incentive Plan) of the common stock on the
date of the option grant. The options become exercisable on the first
anniversary of the date of grant and expire five years after the date of
grant. The option price may be paid in cash, shares of common stock or a
combination of cash and shares. All options granted to nonemployee
directors are nontransferable, other than by will or the laws of descent
and distribution, and each option is exercisable, during the lifetime of
the optionee, only by the optionee. If a person ceases to be a nonemployee
director due to death, disability or retirement, his or her options
generally will be exercisable for a period of one year (but not later than
the expiration date of the option). If a nonemployee director's service
terminates for any other reason, options that are not then exercisable
shall be canceled and options that are exercisable may be exercised at any
time within 90 days after the date of such termination (but not later than
the expiration date of the options). The portion of the Incentive Plan
applicable to nonemployee directors is designed to operate automatically
and not require administration.
Effect of Change of Control. The Incentive Plan provides for the
acceleration of certain benefits in the event of a "Change of Control" of
the Company. A Change of Control will be deemed to have occurred if either
(i) any person or group acquires beneficial ownership of 25% of the voting
securities of the Company; (ii) there is a change in the composition of a
majority of the Board of Directors within any two-year period; or (iii) a
change in control (as such term is used in Schedule 14A promulgated under
the Securities Exchange Act of 1934) otherwise occurs.
Upon the occurrence of a Change of Control, each nonemployee director
option with respect to which six months have elapsed since the date of
grant, whether the option is then exercisable or not, will be cancelled in
consideration for a payment equal to the excess of the then fair market
value of the common stock (as calculated in accordance with the Incentive
Plan) over the option exercise price. Except as may be provided in the
agreement relating to the options, a holder of any other options granted
under the Incentive Plan which are not then exercisable in full at the time
of a Change of Control will be entitled, with respect to the portion not
then exercisable, to receive a cash payment equal to the excess of the then
fair market value of the common stock (as calculated in accordance with the
Incentive Plan) over the option exercise price. In addition, upon a Change
of Control, all stock appreciation rights which have not been granted in
tandem with options and which have been outstanding for at least six months
will become exercisable in full, restrictions on restricted stock shall
lapse and all performance shares shall be deemed to be earned in full.
6 <PAGE>
<PAGE>
Changes in the Company's Capital Structure. In the event of any
change in the outstanding shares of common stock by reason of a
reorganization, recapitalization, stock split, stock dividend, combination
or exchange of shares, merger, consolidation or any change in the corporate
structure or shares of the Company, the maximum aggregate number and class
of shares as to which stock options, stock appreciation rights, restricted
stock awards, and performance shares may be granted under the Incentive
Plan and the shares issuable pursuant to outstanding stock options, stock
appreciation rights, restricted stock awards, and performance shares shall
be appropriately adjusted by the Compensation Committee, whose
determination shall be final.
Amendment of the Incentive Plan. The Board of Directors may amend,
suspend or terminate the Incentive Plan at any time and from time to time;
provided, however, that no amendment shall be made without shareholder
approval if such approval is necessary in order for the Incentive Plan to
continue to comply with Rule 16b-3 under the Securities Exchange Act of
1934, as amended, and provided further that the provisions of the Incentive
Plan regarding non-employee director stock options shall not be amended
more than once every six months, other than to comport with changes in the
Code, the Employment Retirement Income Security Act of 1974, as amended
("ERISA"), or the rules thereunder.
Duration of the Incentive Plan. The Incentive Plan became effective
on October 6, 1993, and no awards may be granted pursuant to the Incentive
Plan after October 6, 2003.
Federal Income Tax Consequences -- Incentive Stock Options. The grant
of incentive stock options to an employee does not result in any income tax
consequences. The exercise of an incentive stock option does not result in
any income tax consequences to the employee if the incentive stock option
is exercised by the employee during his employment with the Company or a
subsidiary, or within a specified period after termination of employment
due to death or retirement for age or disability under then established
rules of the Company. However, the excess of the fair market value of the
shares of stock as of the date of exercise over the option price is a tax
preference item for purposes of determining an employee's alternative
minimum tax. An employee who sells shares acquired pursuant to the
exercise of an incentive stock option after the expiration of (i) two years
from the date of grant of the incentive stock option, and (ii) one year
after the transfer of the shares to the employee (the "Waiting Period")
will generally recognize long-term capital gain or loss on the sale.
An employee who disposes of his incentive stock option shares prior to
the expiration of the Waiting Period (an "Early Disposition") generally
will recognize ordinary income in the year of sale in an amount equal to
the excess, if any, of (i) the lesser of (a) the fair market value of the
shares as of the date of exercise or (b) the amount realized on the sale,
over (ii) the option price. Any additional amount realized on an Early
Disposition should be treated as capital gain to the employee, short or
long-term, depending on the employee's holding period for the shares. If
the shares are sold for less than the option price, the employee will not
recognize any ordinary income but will recognize a capital loss, short or
long-term, depending on the holding period.
The Company will not be entitled to a deduction as a result of the
grant of an incentive stock option, the exercise of an incentive stock
option, or the sale of incentive stock option shares after the Waiting
Period. If an employee disposes of his incentive stock option shares in an
Early Disposition, the Company will be entitled to deduct the amount of
ordinary income recognized by the employee.
Federal Income Tax Consequences -- Non-Qualified Stock Options. The
grant of NSO's under the Incentive Plan will not result in the recognition
of any taxable income by the participants. A participant will recognize
income on the date of exercise of a non-qualified stock option equal to the
difference between (i) the fair market value on that date of the non-
qualified stock option shares acquired, and (ii) the exercise price. The
tax basis of these shares for the purpose of a subsequent sale includes the
option price paid and the ordinary income reported on exercise of options.
The income reportable on exercise of the option by an employee is subject
to federal and state income and employment tax withholding.
Generally, the Company will be entitled to a deduction in the amount
reportable as income by the participant on the exercise of a non-qualified
stock option.
7 <PAGE>
<PAGE>
Federal Income Tax Consequences -- Stock Appreciation Rights and
Performance Shares. Stock Appreciation Rights and Performance Share awards
involve the issuance of shares of stock or the payment of cash, without
other payment by the recipient, as additional compensation for services to
the Company. The recipient will recognize taxable income equal to cash
received or the fair market value of the shares on the date of the award,
which becomes the tax basis in a subsequent sale. Generally, the Company
will be entitled to a corresponding deduction in an amount equal to the
income recognized by the recipient.
Federal Income Tax Consequences -- Restricted Stock Grants.
Restricted stock granted under the Incentive Plan ("Restricted Stock
Grants") generally will not be taxed to the recipient, nor deductible by
the Company, at the time of grant. Restricted Stock Grants involve the
issuance of stock to a participant subject to specified restrictions as to
sale or transferability of the stock and are subject to a substantial risk
of forfeiture. On the date the restrictions lapse, and the stock becomes
transferable or not subject to a substantial risk of forfeiture, whichever
is applicable, the recipient recognizes ordinary income equal to the excess
of the fair market value of the stock on that date over the purchase price
paid for the stock, if any. The participant's tax basis for the stock
includes the amount paid for the stock, if any, and the ordinary income
recognized. Generally, the Company will be entitled to a corresponding
deduction in an amount equal to the income recognized by the recipient.
Compensation Deduction Limitation. Under Section 162(m) of the Code
the Company's tax deduction for certain compensation paid to designated
executives is limited to $1 million per year. These executives include the
Chief Executive Officer and the next four highest compensated officers of
the Company. Section 162(m) provides an exception from this deduction
limitation for certain "performance based" compensation approved by a
committee consisting solely of at least two "outside directors". The
Incentive Plan is generally designed to be able to satisfy these statutory
requirements for stock options and SAR's, when the exercise price is not
less than fair market value on the date of grant. The Company intends to
consider the future potential limitation on the deductibility of
compensation under Section 162(m) in connection with grants under the
Incentive Plan.
Vote Required and Board Recommendation. The affirmative vote of
holders of a majority of shares of common stock represented at the meeting
is required to approve the amendment to the Incentive Plan.
The Board of Directors recommends a vote "for" the proposal.
8 <PAGE>
<PAGE>
STOCK OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS
The following information lists beneficial ownership of common stock
at March 1, 1997 of (i) each director or nominee; (ii) each executive
officer named in the Summary Compensation Table; and (iii) directors and
executive officers as a group. Except as otherwise noted, each person has
sole voting and investment power as to his shares. The percentage of
outstanding common stock, including options exercisable within 60 days of
March 1, 1997, beneficially owned by directors and executive officers as a
group is 1.3%. The percentage beneficially owned by any director or nominee
individually does not exceed 1%.
Shares Beneficially
Owned (a) (b)
C. Baker Cunningham 194,561
Chairman of the Board, President,
Chief Executive Officer and Director
Richard K. Reece 42,624(c)
Vice President, Finance, Treasurer
and Chief Financial Officer
Peter J. Wickman 37,909(d)
Vice President, Operations
Kevin L. Bloomfield 26,247
Vice President, Secretary and General Counsel
Larry E. Fast 22,198
Vice President and General Manager,
Cord Products of Belden Wire & Cable Company
Lorne D. Bain 3,200
Director
Joseph R. Coppola 2,700
Director
Alan E. Riedel 13,700(e)
Director
Christopher I. Byrnes 700
Director
Bernard G. Rethore 1,000(f)
Director
John R. DallePezze 1,000
Nominee
All Directors and Executive Officers as a Group 344,839
(a) Includes the following shares covered by stock options which are
currently exercisable or exercisable within 60 days of March 1,
1997: Mr. Cunningham, 121,666 shares; Mr. Reece, 35,000 shares; Mr.
Wickman, 30,000 shares; Mr. Bloomfield, 19,333 shares, Mr. Fast,
8,000 shares, Messrs. Coppola and Bain, 2000 shares; and Mr. Riedel,
1,000 shares.
(b) Includes shares held in the Company's savings plan.
(c) Includes 5,000 shares owned jointly by Mr. Reece and his wife.
(d) Includes 1,000 shares owned jointly by Mr. Wickman and his wife.
(e) Includes 1,500 shares held in an Individual Retirement Account.
(f) Held in trust.
9 <PAGE>
<PAGE>
The following table shows certain information regarding those
stockholders known to the Company to beneficially own more than 5% of the
outstanding shares of common stock.
Amount and
Name and Address Nature of Percent
of Beneficial Owner Beneficial Ownership of class
The Prudential Insurance 2,136,010* 8.1%
Company of America
751 Broad Street
Newark, NJ 07102-3777
* Information based on a Schedule 13G, as amended, filed with the
Securities and Exchange Commission by The Prudential Insurance Company
of America ("Prudential"). Prudential has sole voting power and sole
dispositive power over 894,200 shares, and shared voting power and
shared dispositive power over 1,241,810 shares.
In addition, at December 31, 1996, Boatmen's Trust Company, as Trustee
of the Belden Wire & Cable Retirement Savings Plan ("Savings Plan"), held
of record 367,190 shares, 1.4% of common stock. The Savings Plan permits
plan participants to direct the plan Trustee to vote the common stock of
the Company allocated to their accounts. Under the terms of the plan, the
Trustee will vote unallocated and uninstructed shares in proportion to the
shares to which instructions have been received.
BOARD MEETINGS AND COMMITTEES
The Board of Directors met four times during 1996. All directors
attended all of the meetings of the Board and of the Board Committees on
which they served. The Company has two committees of the Board of
Directors, an Audit Committee and a Compensation Committee. It does not
have a nominating committee.
Audit Committee
Members: Mr. Bain, Chairman; Mr. Riedel and Mr. Rethore.
The Committee met four times in 1996. The Audit Committee meets with
financial management and the Company's independent auditors to review
internal accounting controls, the Company's compliance with its conflict of
interest and ethical conduct policies, and accounting, auditing, and
financial reporting matters.
Compensation Committee
Members: Mr. Coppola, Chairman; and Dr. Byrnes.
The Committee met four times in 1996. The Compensation Committee
generally reviews compensation for officers, annual salary and wage
guidelines for employees, and awards under the Company's Incentive Plan.
COMPENSATION OF DIRECTORS
The Company's nonemployee directors each receive an annual retainer of
$20,000 and $1,000 per meeting for special board meetings or committee
meetings not held in conjunction with a regular board meeting. All
nonemployee directors are reimbursed for expenses incurred in connection
with attending board and committee meetings. Mr. Cunningham does not
receive any compensation for serving as a member of the Board.
Also, under the Non-Employee Director Stock Plan, Messrs. Bain,
Riedel, Coppola and Byrnes each automatically received on September 3, 1996
(and will thereafter receive on the day following each annual meeting of
stockholders) 200 treasury shares of the Company.
In addition, under the Incentive Plan, each nonemployee director is
automatically granted, on the day following each annual meeting of
stockholders, an option to purchase 1,000 shares of common stock. The
option exercise price is equal to 100% of the fair market value (as defined
in the Incentive Plan) of the common stock on the date of the option
10 <PAGE>
<PAGE>
grant. The options become exercisable on the first anniversary of the date
of grant and expire five years after the date of grant. The option price
may be paid in cash, shares of common stock or a combination of cash and
shares.
Following the Company's 1996 Annual Meeting, pursuant to the Incentive
Plan, Messrs. Bain, Riedel, Coppola and Byrnes each received an option to
purchase 1,000 shares of common stock at a price of $29.50 per share. The
options will become exercisable on May 10, 1997 and will expire on May 10,
2001.
All options granted to nonemployee directors are nontransferable,
other than by will or the laws of descent and distribution, and each option
is exercisable, during the lifetime of the optionee, only by the optionee.
If a person ceases to be a nonemployee director due to death, disability or
retirement, his or her options generally will be exercisable for a period
of one year (but not later than the expiration date of the option). If a
nonemployee director's service terminates for any other reason, options
that are not then exercisable shall be cancelled and options that are
exercisable may be exercised at any time within 90 days after the date of
such termination (but not later than the expiration date of the options).
The portion of the Incentive Plan applicable to nonemployee directors is
designed to operate automatically and not require administration.
EXECUTIVE COMPENSATION
Report of the Compensation Committee on Executive Compensation
The Compensation Committee, comprised of non-employee directors of the
Company, is responsible for establishing the Company's compensation
philosophy and making all decisions regarding compensation for the Chief
Executive Officer and other named executive officers, including determining
base salary and bonus amounts, approving target financial performance
levels, and granting stock options and other long-term incentives.
Executive Compensation Objectives
The Company's executive compensation plans are designed to attract and
retain key management employees and to motivate these employees to take
actions that continually enhance stockholder value. The Company's
philosophy is to target base salaries, annual incentives, and long-term
incentive opportunities at the 50th percentile of other comparably sized
companies. Periodically, an outside consultant is hired to evaluate the
level of competitiveness of the executive compensation programs relative to
other companies within the electronics and communication equipment
industry. In the past, companies selected for comparison purposes were
those with whom the Company competes for executive talent; because this may
differ from the Company's product competitors, who may be too large to use
for compensation comparison purposes, this comparison group has not been
selected to reflect the companies shown on the proxy performance graph.
Elements of the Executive Compensation Program
In 1996, the total compensation package for the Company's top
executives consisted of the following elements:
* Base salary.
* Annual bonus.
* Stock options.
The Company's incentive programs are key elements of the total
compensation package, designed to reward executives for short- and long-
term enhancements to the value received by stockholders.
11 <PAGE>
<PAGE>
Base Salaries
Base salaries are reviewed each year and adjusted based on Company
performance, individual performance, the executive's level of
responsibility, and position responsibilities. During 1996, salaries paid
to the named executive officers increased 7.1% over those paid in 1995.
Annual Incentives
The annual incentive program provides executives with the opportunity
to earn bonuses when warranted by Company and individual performance.
Awards are based on individual achievements, operational performance, and
Company progress against long-term goals. Goals are established by the
Committee at the beginning of the fiscal year. The Company's overall
financial performance determines the size of the bonus pool to be
distributed to the executives participating in the program.
In 1996, the Company's financial performance exceeded the strong results
recorded in 1995. Net income increased 19.5% on revenues that were up
9.7% over 1995, which included the effects of three acquisitions: American
Electric Cordsets, Pope Cable & Wire B.V. , completed in the first and
second quarters of 1995, respectively, and Intech Cable, Inc. completed in
the fourth quarter of 1996. For the third year in a row, earnings per share
increased 20% over the prior year. The Company's earnings per share
equalled those budgeted at the beginning of the fiscal year. Overall
financial results were achieved in spite of turbulent market conditions
that affected supplies of copper and Teflon, both major raw materials used
in the Company's products. To reflect this strong performance and provide
incentive awards that approximate the market median, bonuses awarded to the
named executives for 1996 performance were 24% higher than those paid for
1995. It is the Committee's intent to maintain median compensation levels
over time if the Company continues to achieve financial and other strategic
accomplishments that benefit stockholders over the long-term.
Long-Term Incentives
The Company also uses stock options to strengthen the relationship
between top management and the shareholders. These stock options provide
the opportunity for the executives to share in any gains created for the
stockholders and act as a tool for retaining key executives. The
Compensation Committee made stock option grants in 1993, following the
Company's initial public offering, and again in 1994. The Committee did
not make any grants to executive officers in 1995. Options were again
granted in 1996 in keeping with the Committee's policy of granting stock
options every two years to members of the management group and encouraging
ongoing ownership of the Company's stock by the executives.
CEO Compensation
In August 1993, the Company entered into an employment agreement with
Mr. Cunningham that provided for a minimum base salary of $400,000 and a
minimum annual bonus of $100,000 during the term of the contract. In
keeping with the Company's philosophy of emphasizing the incentive elements
of the total compensation package, Mr. Cunningham's base salary was
increased in 1996 by 6% to $445,000. Mr. Cunningham's employment agreement
expired in 1996.
Mr. Cunningham participates in the same incentive plans as other named
executive officers. For 1996, he earned a bonus of $270,000, or 61% of
salary, which reflects the excellent performance of the Company, Mr.
Cunningham's role in achieving the strong financial results and the
successful acquisition of Intech Cable, Inc. This bonus was 25% above the
level paid for 1995. Consistent with the Committee's policy to grant stock
options every other year, Mr. Cunningham was awarded an option for 65,000
shares in 1996.
The Company also maintains certain benefit programs in which the named
executive officers participate. The compensation attributed to these
executive officers for 1996 from these programs is detailed in this proxy
statement. Mr. Cunningham's participation in these programs reflects what
the Committee believes is the participation that other executives at his
level in similarly sized organizations would expect.
12 <PAGE>
<PAGE>
During 1993, Congress enacted legislation that could have the effect
of limiting the deductibility of executive compensation paid to each of the
five highest-paid executive officers. This legislation provides that
compensation paid to any one executive in excess of $1 million will not be
deductible unless it is performance-based and paid under a plan that has
been approved by stockholders.
Although the Committee will consider this legislation when reviewing
executive compensation, the Committee intends to use sound business
judgment to determine whether specific compensation programs are
appropriate, even if certain elements may not meet the performance criteria
under the new legislation. However, the Company believes that the
legislation will not presently have a material effect on the Company.
Joseph R Coppola, Chairman
Christopher I. Byrnes
13 <PAGE>
<PAGE>
Summary Compensation Table
<TABLE>
<CAPTION>
Long-Term
Compensation
Awards
Securities All
Annual Compensation Underlying Other
Salary(1) Bonus(2) Options(3) Compensation(4)
Name and Principal Position Year ($) ($) (#) ($)
<S> <C> <C> <C> <C> <C>
C. Baker Cunningham 1996 440,833 270,000 65,000 29,589
Chairman of the Board, President, 1995 416,667 215,000 25,950
and Chief Executive Officer 1994 400,000 160,000 70,000 22,125
Richard K. Reece 1996 222,000 100,000 15,000 13,590
Vice President, Finance, Treasurer 1995 210,000 80,000 12,150
and Chief Financial Officer 1994 201,666 60,000 15,000 17,895
Peter J. Wickman 1996 197,500 100,000 15,000 12,488
Vice President, Operations 1995 171,500 80,000 10,418
1994 155,833 60,000 15,000 8,437
Kevin L. Bloomfield 1996 169,666 80,000 10,000 10,560
Vice President, Secretary 1995 160,500 65,000 9,247
and General Counsel 1994 152,500 45,000 8,000 7,846
Larry E. Fast 1996 152,833 45,000 7,500 8,678
Vice President and General Manager 1995 145,833 40,000 8,362
Cord Products, Belden Wire & Cable 1994 138,783 40,000 7,000 7,160
Company
</TABLE>
(1) The aggregate amount of perquisites and other personal benefits for
any named executive does not exceed $50,000 or 10% of the total
annual salary and bonus for any such named executive and, therefore,
such items have been excluded.
(2) Determined by the Compensation Committee at its first meeting held
after the end of the fiscal year in which the compensation was
earned.
(3) Options granted under the Incentive Plan. The exercise of one-third
of the shares are permitted on the first, second, and third
anniversaries of the grant dates. The exercise price for the 1994
options was $18.31 per share and the exercise price for the 1996
options was $30.75 per share. In each instance, the exercise price
equaled the fair market value (as defined in the Incentive Plan) on
the grant date.
(4) Amounts reflected consist of: (i) contributions and allocations
under savings plans of the Company and (ii) for Mr. Reece, a $7,583
transfer allowance paid by the Company in 1994, incurred in
connection with his move from Houston, Texas to St. Louis, Missouri,
which is consistent with the Company's policy with respect to the
relocation of existing employees.
14 <PAGE>
<PAGE>
Option Grants in Last Fiscal Year
<TABLE>
<CAPTION>
Individual Grants
Percent of Potential Realizable
Total Values at Assumed
Number of Options Annual Rates
Securities Granted to of Stock Price
underlying Employees Appreciation for
Options in Fiscal Exercise Expiration Option Term(1)
Granted Year Price Date 5%($) 10%($)
(#) ($/Sh)
(a) (b) (2) (c) (d) (3) (e) (f) (g)
<S> <C> <C> <C> <C> <C> <C>
C. Baker Cunningham 65,000 19 30.75 02/28/2006 1,257,003 3,185,493
Richard K. Reece 15,000 4 30.75 02/28/2006 290,078 735,114
Peter J. Wickman 15,000 4 30.75 02/28/2006 290,078 735,114
Kevin L. Bloomfield 10,000 3 30.75 02/28/2006 193,385 490,076
Larry E. Fast 7,500 2 30.75 02/28/2006 145,039 367,557
</TABLE>
(1) The Company elected to use "Potential Realizable Values at Assumed
Annual Rates of Stock Price Appreciation for Option Term" (columns (f)
and (g)). The dollar amounts under these columns are the result of
calculations at the 5% and 10% rates set by the Securities and
Exchange Commission and therefore are not intended to forecast
possible future appreciation, if any, of the stock price of the
Company.
(2) Grants of stock options in 1996 awarded under the Incentive Plan.
Exercises of one-third of the shares are permitted on the first,
second, and third anniversaries of the grant date.
(3) The purchase price of common stock subject to an option is the fair
market value of the common stock on the date of grant as defined in
the Incentive Plan.
<TABLE>
<CAPTION>
Aggregated Option Exercises In Last Fiscal Year And FY-End Option Values
Number of Securities Value of Unexercised
Underlying Unexercised in-the-Money
Shares Options Options at
Acquired on Value at December 31, 1996 (#) December 31, 1996 ($)
Exercise Realized(1) Exercisable/ Exercisable/
(#) ($) Unexercisable(2) Unexercisable(3)
___________________ _________ ___________ _____________ _____________
<S> <C> <C> <C> <C>
C. Baker Cunningham 76,667/88,333 1,535,596/842,344
Richard K. Reece 25,000/20,000 518,775/187,200
Peter J. Wickman 5,000 110,625 20,000/20,000 408,150/187,200
Kevin L. Bloomfield 13,333/12,667 276,674/112,346
Larry E. Fast 10,000/9,834 205,241/90,479
</TABLE>
(1) Represents the difference between the option price ($14.875) and the
fair market value of the stock on the exercise date, ($36.00) per
share
(2) Each of the executive officers has received three option grants under
the Incentive Plan: on October 6, 1993 at an exercise price of $14.87
per share, on February 28, 1994 at an exercise price of $18.31 per
share and on February 28, 1996 at an exercise price of $30.75 per
share. For each grant, the exercise price was the fair market value of
the common stock (as defined in the Incentive Plan) on the date of
grant. Options become exercisable as to one-third of such options on
each of the first three anniversaries of the date of grant and will
expire five years after the date of grant for the 1993 and 1994 grants
and ten years after the date of grant for the 1996 grant.
(3) "Value" represents the difference between the closing price of the
common stock on the New York Stock Exchange on December 31, 1996 and
the exercise price of such options.
15 <PAGE>
<PAGE>
Certain Change in Control Arrangements
The Company maintains a "grantor trust" under Section 671 of the Code
to provide certain participants in designated compensation and supplemental
retirement plans with greater assurance that the benefits and payments to
which those participants are entitled under those plans will be paid.
Prior to a "change of control" of the Company (as defined in the Trust
agreement), the Company has the discretion to make contributions to the
Trust. After a change in control of the Company, the Company must transfer
to the Trust the amount of the benefits participants have earned through
the date of the change in control and thereafter continue to fund the Trust
as benefits accrue. At December 31, 1996, the balance in the Trust
totalled $500. The assets of the Trust are subject to claims of the
creditors of the Company in the event the Company becomes "insolvent" as
defined in the Trust agreement.
The Company has severance compensation agreements with the executives
named in the Summary Compensation Table that become operative if they are
terminated following a change in control (as defined in the agreement). In
the event of a change in control of the Company, the officer agrees to
remain in the employ of the Company for at least three years. Each
agreement contemplates that upon a change in control, the officer will
continue to receive substantially the same compensation and benefits from
the Company (or its successor) that he received before the change. If
during the three-year period following a change in control, the officer's
employment is terminated by the Company (or its successor) other than for
"cause" or "disability" or if the officer terminates the agreement for
"good reason" (as defined in the agreement), the officer generally will be
entitled to a payment of 2 times (2.99 times for Mr. Cunningham) his annual
compensation from the Company, accrued benefits through the date of
termination, and continued life, medical and dental benefits for two years.
See "2--Proposal to Amend the Belden Inc. Long-Term Incentive Plan"
for a description of certain change in control provisions applicable to
outstanding awards under the Incentive Plan.
Pension Plans
The executives named in the Summary Compensation Table may upon
retirement be entitled to benefits from the Salaried Employees' Retirement
Plan of Belden Wire & Cable Company (the "Belden Retirement Plan") and the
Supplemental Excess Defined Benefit Plan of Belden Wire & Cable Company
(the "Supplemental Plan"). Benefits under the plans upon retirement are
determined based upon compensation during the employment period and years
of service.
Pursuant to the Belden Retirement Plan, the Company credits to each
individual's account thereunder 4% of each year's total compensation up to
the Social Security wage base for the year, plus 8% of each year's total
compensation that exceeds the Social Security wage base. For this purpose,
total compensation is cash remuneration paid by the Company to or for the
benefit of a participant in the Belden Retirement Plan for services
rendered while an employee.
For the executives named in the Summary Compensation Table, the total
compensation will be computed as shown in the columns "Salary" and "Bonus"
of the Summary Compensation Table. Employees who were formerly employees of
Cooper were credited for service while employed by Cooper. Benefits for
service through August 1, 1993 were determined under the Cooper Salaried
Employees' Retirement Plan then in effect and converted to initial balances
under the Belden Retirement Plan. Funds equal to the actuarial value of the
accrued liabilities for all participants plus a pro rata portion of the
Cooper plan excess assets have been transferred from the Cooper pension
trust to a trust established by Belden for the Belden Retirement Plan.
Employees do not make any contributions to the Belden Retirement Plan.
Benefits at retirement are payable, as the participant elects, in the form
of an escalating annuity, a level annuity with or without survivorship, or
a lump-sum payment. The Company contributes to a trust fund sufficient to
meet the minimum requirements under the Code to maintain the status of the
Belden Retirement Plan as a qualified defined benefit plan.
16 <PAGE>
<PAGE>
The Supplemental Plan is an unfunded, nonqualified plan which provides
to certain employees, including those named in the Summary Compensation
Table, Belden Retirement Plan benefits that cannot be paid from a
qualified, defined benefit plan due to provisions of the Code.
Pension Benefits
<TABLE>
<CAPTION>
Years of Estimated
Credited Year Annual
Service as of Individual Benefit at
December 31, 1996 Reaches Age 65 Age 65
<S> <C> <C> <C>
C. Baker Cunningham 26.5 2006 249,855
Richard K. Reece 3.4 2021 139,146
Peter J. Wickman 16.0 2014 91,862
Kevin L. Bloomfield 15.5 2016 94,308
Larry E. Fast 24.3 2012 78,660
</TABLE>
For each individual shown in the Summary Compensation Table, the table
above shows current credited years of service, the year each attains age
65, and the projected annual pension benefit at age 65. The projected
annual pension benefit is based on the following assumptions: benefits will
be paid on a straight-life annuity basis, continued compensation at 1996
levels and an interest credit rate of 5%. Amounts payable under the
Supplemental Plan are included in the estimated annual benefit.
17 <PAGE>
<PAGE>
STOCK PRICE PERFORMANCE GRAPH
The table [graph] below compares cumulative total stockholder return (assuming
reinvestment of dividends) since the first day the common stock began
trading with the cumulative total stockholder return of the Standard &
Poor's 500 Stock Index and the Standard & Poor's Electrical Equipment Index
starting on September 29, 1993, at closing prices.
[The line graph mentioned above was replaced with the table shown below for
Edgar filing purposes]
<TABLE>
<CAPTION>
Total Return to Stockholders*
September 29, 1993 December 31, 1993 December 31, 1994 December 31, 1995 December 31, 1996
<S> <C> <C> <C> <C> <C>
Belden 100.00 130.72 156.61 182.11 261.05
S&P Electical Equipment Index 100.00 107.49 108.75 152.60 209.58
S&P 500 Index 100.00 102.32 103.67 142.63 175.38
* The Company did not pay any dividends in 1993.
</TABLE>
RELATIONSHIP WITH INDEPENDENT AUDITORS
During the year ended December 31, 1996, the Company employed Ernst &
Young LLP principally to perform the annual audit and to render other
services. Mr. Reece was a partner with Ernst & Young LLP prior to his
joining the Company in August 1993.
Representatives of Ernst & Young LLP will be present at the Annual
Meeting and will be available to answer questions and discuss matters
pertaining to the Report of Independent Auditors contained in the 1996
Annual Report to Shareholders which is being mailed with this Proxy
Statement to all shareholders. Representatives of Ernst & Young LLP will
have the opportunity to make a statement, if they desire to do so.
OTHER MATTERS
At the date of this Proxy Statement, management is not aware of any
matters to be presented for action at this meeting other than those
described above. However, if other matters should come before this meeting,
it is the intention of the persons named as proxies in the accompanying
proxy to vote in accordance with their judgment on such matters.
Mr. Riedel, a director, is "Of Counsel" to the law firm, Squire, Sanders &
Dempsey. The firm represents the Company in certain legal matters.
18 <PAGE>
<PAGE>
Stockholder Proposals
Stockholders' proposals intended to be presented at the 1998 Annual
Meeting that are eligible for inclusion in the Company's Proxy Statement
and the form of proxy for the meeting under applicable rules of the
Securities and Exchange Commission must be received by the Company at its
principal executive offices (Attention: Secretary) on or before November
30, 1997.
Such proposals may be made only by persons who are stockholders,
beneficially or of record, on the date the proposal is submitted and who
continue in such capacity through the meeting date, of at least 1% or
$1,000 in market value of securities entitled to be voted at the meeting,
and have held such securities for at least one year.
In addition to the above requirements, the Company's Bylaws provide
that for business to be properly brought before an annual meeting by a
stockholder, the stockholder must have given notice thereof in writing to
the Secretary of the Company either by personal delivery or by United
States registered or certified mail, postage prepaid, not less than 60 nor
more than 90 days prior to the date of such meeting. Such stockholder's
notice to the Secretary shall set forth as to each matter the stockholder
proposes to bring before the annual meeting (i) a brief description of the
business desired to be brought before the meeting, including the complete
text of any resolutions to be presented at the meeting, with respect to
such business, and the reasons for conducting such business at the meeting,
(ii) the name and address of record of the stockholder proposing such
business, (iii) the class and number of shares of capital stock of the
Company that are beneficially owned by the stockholder and (iv) any
material interest of the stockholder in such business. If a stockholder
attempts to bring business before an annual meeting without complying with
this procedure, the chairman of the meeting may declare to the meeting that
the business was not properly brought before the meeting and, if he shall
so declare, such business shall not be transacted. Stockholders also must
comply with all applicable requirements of the Securities Exchange Act of
1934, as amended (the "Act") and the rules and regulations under the Act
with respect to such matters.
Stockholder Nominees
The Company's Bylaws provide that, subject to certain limitations
discussed below, any stockholder entitled to vote in the election of
directors generally may nominate one or more persons for election as
directors at the meeting. The stockholder must provide written notice of
his intent to make such nomination or nominations, either by personal
delivery or by United States registered or certified mail, postage prepaid,
to the Secretary of the Company not less than sixty nor more than ninety
days prior to a meeting of the stockholders called for the election of
directors; provided, however, that in the event that less than seventy
days' notice of the date of the meeting is given to stockholders, such
written notice shall be delivered or mailed, as prescribed, not later than
the close of business on the tenth day following the day on which notice of
the date of the meeting was mailed to stockholders or public disclosure of
the date of the meeting was made, whichever occurs first.
Each notice shall set forth (i) the name and address of the
stockholder who intends to make the nomination and of the person or persons
to be nominated, (ii) a representation that the stockholder is a holder of
record of shares of capital stock of the Company entitled to vote at such
meeting and intends to appear in person or by proxy at the meeting to
nominate the person or persons specified in the notice, (iii) a description
of all arrangements, understandings or relationships between the
stockholder and each nominee and any other person or persons (naming such
person or persons) pursuant to which the nomination or nominations are to
be made by the stockholder and (iv) such other information regarding each
nominee proposed by such stockholder as would be required to be included in
a proxy statement filed pursuant to the proxy rules of the Securities and
Exchange Commission had the nominee been nominated, or intended to be
nominated, by the Board of Directors, and shall include a consent signed by
each such nominee to serve as a director of the Company if so elected. The
chairman of the meeting may refuse to acknowledge the nomination of any
person not made in compliance with these procedures.
19 <PAGE>
<PAGE>
Solicitation of Proxies
Proxies may be solicited by the directors, officers and employees of
the Company without additional compensation, by personal interview,
telephone, facsimile, mail or messenger. The Company will reimburse the
reasonable out-of-pocket expenses incurred by brokerage firms and other
custodians, nominees and fiduciaries who hold common stock of record for
the forwarding of solicitation materials to the beneficial owners of the
common stock. In addition, Georgeson & Company, Inc. has been engaged to
solicit proxies at a fee of $5,500 plus out-of-pocket expenses. The Company
will bear such solicitation expenses.
Voting Procedures
Vote Required: Delaware law requires for approval of each proposal
the affirmative vote of holders of a majority of shares of common stock
represented at the meeting. Votes cast by proxy or in person at the
meeting will be tabulated by the Inspector of Elections.
Effect of an Abstention and Broker Non-Votes: A shareholder who
withholds from voting on proposal one or who abstains from voting on
proposal two will be included in the number of shareholders present at the
meeting for the purpose of determining the presence of a quorum.
Abstentions (including votes withheld) will be treated as votes cast
against the proposal because they are deemed shares present and entitled to
vote at the meeting. Under the rules of the New York Stock Exchange,
brokers holding stock for the accounts of their clients who have not been
given specific voting instructions as to either proposal by their clients
may vote their clients' proxies in their own discretion for such proposal.
Should a matter arise for which brokers do not have discretion and have not
been given specific voting instructions, such broker non-votes will not,
under applicable Delaware law, be considered as shares entitled to vote on
such matter and will not have any effect on the outcome of such matter.
A copy of the 1996 Annual Report on Form 10-K for the year ended
December 1996, filed with the Securities and Exchange Commission, is
available upon request. Please write to:
Belden Inc.
Attention: Investor Relations
7701 Forsyth Boulevard, Suite 800
St. Louis, Missouri 63105
20 <PAGE>
<PAGE>
PROXY
BELDEN INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
MAY 1, 1997
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned stockholder of Belden Inc. appoints C. Baker
Cunningham and Kevin Bloomfield, or either of them, proxies of the
undersigned with power of substitution to vote, as designated on the
reverse side of this card, all shares which the undersigned would be
entitled to vote at the Annual Meeting of Stockholders to be held on May 1,
1997, at 11:00 a.m., C.D.T., in the Lewis & Clark Room, the St. Louis Club,
7701 Forsyth Blvd.,St. Louis, Missouri, or at any adjournment thereof, with
all powers the stockholder would possess if present, on the matters
described in the Proxy Statement dated March 26, 1997. The stockholder
revokes any proxies previously given with respect to such meeting.
THIS PROXY WILL BE VOTED AS SPECIFIED ON THE REVERSE SIDE, BUT IF NO
SPECIFICATION IS MADE, IT WILL BE VOTED FOR THE NOMINEES FOR DIRECTORS
(JOSEPH R. COPPOLA, CHRISTOPHER I. BYRNES AND JOHN R. DALLEPEZZE) AND
PROPOSAL 2, AND IN THE DISCRETION OF THE PROXIES ON THE OTHER MATTERS AS
MAY COME BEFORE THE MEETING OR ANY ADJOURNMENT THEREOF.
Receipt is hereby acknowledged of the Notice of Annual Meeting of
Stockholders and Proxy Statement, each dated March 26, 1997, and the Annual
Report of Belden Inc. for the fiscal year ended December 31, 1996.
This card also constitutes voting instructions for any shares held for
the stockholder in the Belden Wire & Cable Retirement Savings Plan.
SEE REVERSE
SIDE <PAGE>
<PAGE>
[X] Please mark your votes as in this example.
<TABLE>
<CAPTION>
The Board of Directors recommends a vote FOR the nominees listed and FOR Item 2.
<C> <C> <C>
1. Election of 2. Approval of the Amendment to the Belden Inc. Long-Term
Directors Nominees. Incentive Plan ("Plan") increasing the reserve of shares under
the Plan by 1,300,000 shares.
FOR WITHHELD
Joseph R. Coppola FOR AGAINST ABSTAIN
Christopher I. Byrnes [ ] [ ]
John R. DallePezze [ ] [ ] [ ]
</TABLE>
To withhold your vote for any nominee(s), write
the name here:
__________________________________________________
[number of I plan to attend the meeting. [ ]
shares]
Please sign exactly as name appears hereon.
[Name and address Joint owners should each sign. When signing
of as attorney, executor, administrator,
Stockholder] trustee or guardian, please give full title
as such
_________________________________________
_______________________________________1997
SIGNATURE(S) DATE <PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> DEC-31-1996
<CASH> 1,795
<SECURITIES> 0
<RECEIVABLES> 107,027
<ALLOWANCES> 513
<INVENTORY> 73,785
<CURRENT-ASSETS> 190,933
<PP&E> 284,917
<DEPRECIATION> 132,983
<TOTAL-ASSETS> 371,645
<CURRENT-LIABILITIES> 82,735
<BONDS> 0
0
0
<COMMON> 261
<OTHER-SE> 179,446
<TOTAL-LIABILITY-AND-EQUITY> 371,645
<SALES> 667,425
<TOTAL-REVENUES> 667,425
<CGS> 499,046
<TOTAL-COSTS> 499,046
<OTHER-EXPENSES> 73,962
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 3,497
<INCOME-PRETAX> 90,920
<INCOME-TAX> 35,686
<INCOME-CONTINUING> 55,234
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 55,234
<EPS-PRIMARY> 2.11
<EPS-DILUTED> 2.11
</TABLE>
