-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, WUgsBg0E+N1pe6yKoJ52WkYqbbkmbP9iudl94jQWC6N0ykdH0DOCrhwn9nLOGu42 sK5EGu07bfz/RT5ySR6ZwA== 0000950123-96-005881.txt : 19961027 0000950123-96-005881.hdr.sgml : 19961027 ACCESSION NUMBER: 0000950123-96-005881 CONFORMED SUBMISSION TYPE: SC 13E4 PUBLIC DOCUMENT COUNT: 14 FILED AS OF DATE: 19961024 SROS: NYSE SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: HANDY & HARMAN CENTRAL INDEX KEY: 0000045333 STANDARD INDUSTRIAL CLASSIFICATION: ROLLING DRAWING & EXTRUDING OF NONFERROUS METALS [3350] IRS NUMBER: 135129420 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13E4 SEC ACT: 1934 Act SEC FILE NUMBER: 005-15620 FILM NUMBER: 96647233 BUSINESS ADDRESS: STREET 1: 555 THEODORE FREMD AVE CITY: RYE STATE: NY ZIP: 10580 BUSINESS PHONE: 9149215200 MAIL ADDRESS: STREET 1: 555 THEODORE FREMD AVE CITY: RYE STATE: NY ZIP: 10580 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: HANDY & HARMAN CENTRAL INDEX KEY: 0000045333 STANDARD INDUSTRIAL CLASSIFICATION: ROLLING DRAWING & EXTRUDING OF NONFERROUS METALS [3350] IRS NUMBER: 135129420 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13E4 BUSINESS ADDRESS: STREET 1: 555 THEODORE FREMD AVE CITY: RYE STATE: NY ZIP: 10580 BUSINESS PHONE: 9149215200 MAIL ADDRESS: STREET 1: 555 THEODORE FREMD AVE CITY: RYE STATE: NY ZIP: 10580 SC 13E4 1 SCHEDULE 13E4 1 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ------------------------ SCHEDULE 13E-4 Issuer Tender Offer Statement (Pursuant to Section 13(e)(1) of the Securities Exchange Act of 1934) ------------------------ HANDY & HARMAN (Name of issuer) HANDY & HARMAN (Name of person(s) filing statement) ------------------------ Common Stock, par value $1.00 per share and the associated Common Stock Purchase Rights (Title of class of securities) 410306104 (CUSIP number of class of securities) Paul E. Dixon, Vice President, General Counsel and Secretary Handy & Harman 250 Park Avenue New York, New York 10177 (212) 661-2400 (Name, address and telephone number of person authorized to receive notices and communications on behalf of the person(s) filing statement) ------------------------ COPY TO: Milton G. Strom Skadden, Arps, Slate, Meagher & Flom LLP 919 Third Avenue New York, New York 10022 (212) 735-3000 ------------------------ October 24, 1996 (Date tender offer first published, sent or given to security holders) CALCULATION OF FILING FEE - --------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------
TRANSACTION AMOUNT OF VALUATION* FILING FEE - --------------------------------------------------------------------------------------------- $36,000,000 $7,200 - --------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------
* Calculated solely for purposes of determining the filing fee, based upon the purchase of 1,800,000 shares at the maximum tender offer price per share of $20.00. / / Check box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing. Amount Previously Paid: N/A Filing Party: N/A Form or Registration No.: N/A Date File: N/A - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 2 This Issuer Tender Offer Statement on Schedule 13E-4 (the "Statement") relates to the tender offer by Handy & Harman, a New York corporation (the "Company"), to purchase up to 1,800,000 shares of its common stock, par value $1.00 per share, and the associated common stock purchase rights (the "Rights," and collectively with shares of common stock, the "Shares"), at prices, net to the seller in cash, not greater than $20.00 nor less than $17.50 per Share, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated October 24, 1996 (the "Offer to Purchase") and the related Letter of Transmittal (which, as they may be amended from time to time, are herein collectively referred to as the "Offer"). Tenders of Shares pursuant to the Offer will include a tender of the associated Rights and no separate consideration will be paid for such Rights. Copies of the Offer to Purchase and Letter of Transmittal are filed as Exhibits (a)(1) and (a)(2), respectively, to this Statement. ITEM 1. SECURITY AND ISSUER. (a) The name of the issuer is Handy & Harman, a New York corporation. The address of its principal executive offices is 250 Park Avenue, New York, New York 10177. (b) The information set forth in "Introduction," "Section 1. Number of Shares; Proration" and "Section 9. Interests of Directors and Executive Officers; Transactions and Arrangements Concerning the Shares" in the Offer to Purchase is incorporated herein by reference. The Offer is being made to all holders of Shares, including officers, directors and affiliates of the Company, although the Company has been advised that none of its directors or executive officers intends to tender any Shares pursuant to the Offer. (c) The information set forth in "Introduction" and "Section 7. Price Range of Shares; Dividends" in the Offer to Purchase is incorporated herein by reference. (d) This Statement is being filed by the issuer. ITEM 2. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. (a)-(b) The information set forth in "Section 10. Source and Amount of Funds" in the Offer to Purchase is incorporated herein by reference. ITEM 3. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE ISSUER. (a)-(j) The information set forth in "Introduction," "Section 8. Background and Purpose of the Offer; Certain Effects of the Offer," "Section 9. Interests of Directors and Executive Officers; Transactions and Arrangements Concerning the Shares," "Section 10. Source and Amount of Funds" and "Section 12. Effects of the Offer on the Market for Shares; Registration Under the Exchange Act" in the Offer to Purchase is incorporated herein by reference. ITEM 4. INTEREST IN SECURITIES OF THE ISSUER. The information set forth in "Section 9. Interests of Directors and Executive Officers; Transactions and Arrangements Concerning the Shares" and "Schedule I -- Certain Transactions Involving Shares" in the Offer to Purchase is incorporated herein by reference. ITEM 5. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO THE ISSUER'S SECURITIES. The information set forth in "Introduction," "Section 8. Background and Purpose of the Offer; Certain Effects of the Offer" and "Section 9. Interests of Directors and Executive Officers; Transactions and Arrangements Concerning the Shares" in the Offer to Purchase is incorporated herein by reference. ITEM 6. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED. The information set forth in "Introduction" and "Section 16. Fees and Expenses" in the Offer to Purchase is incorporated herein by reference. 2 3 ITEM 7. FINANCIAL INFORMATION. (a)-(b) The information set forth in "Section 11. Certain Information About the Company" in the Offer to Purchase is incorporated herein by reference. The information set forth on (i) pages 15 through 32 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995, filed as exhibit (g)(1) hereto; (ii) pages 19 through 36 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1994, filed as exhibit (g)(2) hereto; (iii) pages 1 through 11 of the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1996, filed as exhibit (g)(3) hereto; and (iv) pages 1 through 10 of the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1996, filed as exhibit (g)(4) hereto, in each case, is incorporated herein by reference. ITEM 8. ADDITIONAL INFORMATION. (a) Not applicable. (b) The information set forth in "Section 13. Certain Legal Matters; Regulatory Approvals" in the Offer to Purchase is incorporated herein by reference. (c) The information set forth in "Section 12. Effects of the Offer on the Market for Shares; Registration Under the Exchange Act" in the Offer to Purchase is incorporated herein by reference. (d) Not applicable. (e) The information set forth in the Offer to Purchase and the related Letter of Transmittal, copies of which are attached hereto as Exhibits (a)(1) and (a)(2), respectively, is incorporated herein by reference. ITEM 9. MATERIAL TO BE FILED AS EXHIBITS. (a)(1) Form of Offer to Purchase dated October 24, 1996. (a)(2) Form of Letter of Transmittal. (a)(3) Form of Notice of Guaranteed Delivery. (a)(4) Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees. (a)(5) Form of Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees. (a)(6) Form of Letter dated October 24, 1996 to shareholders from the Chairman and Chief Executive Officer of the Company. (a)(7) Form of Letter from the Company to participants in the Company Savings Plan, including the form of Direction Form to T. Rowe Price Trust Company, as Trustee, from participants in the Company savings plan. (a)(8) Form of Press Release issued by the Company dated October 22, 1996. (a)(9) Form of Summary Advertisement dated October 24, 1996. (a)(10) Guidelines for Certification of Taxpayer Identification Number on Form W-9. (b)(1) Revolving Credit Agreement dated as of September 28, 1994 (the "Revolving Credit Agreement") among the Company, certain financial institutions, as lenders, The Bank of Nova Scotia ("Scotiabank"), Chemical Bank and Bank of New York, as co-agents, and Scotiabank, as administrative agent (previously filed with the Commission as Exhibit 10.3 to the Company's Current Report on Form 8-K dated October 12, 1994 and incorporated by reference herein). (b)(2) First Amendment to the Revolving Credit Agreement, dated as of June 30, 1995. (b)(3) Second Amendment to the Revolving Credit Agreement, dated as of September 24, 1996. (b)(4) Third Amendment to the Revolving Credit Agreement, dated as of October 11, 1996. (c) Not applicable. (d) Not applicable.
3 4 (e) Not applicable. (f) Not applicable. (g)(1) Pages 15 through 32 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 (incorporated by reference from the Company's Form 10-K filed with the Commission on March 28, 1996). (g)(2) Pages 19 through 36 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1994 (incorporated by reference from the Company's Form 10-K filed with the Commission on March 25, 1995). (g)(3) Pages 1 through 11 of the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1996 (incorporated by reference from the Company's Form 10-Q filed with the Commission on August 13, 1996). (g)(4) Pages 1 through 10 of the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1996 (incorporated herein by reference from the Company's Form 10-Q filed with the Commission on May 15, 1996).
4 5 SIGNATURE After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. HANDY & HARMAN By: /s/ Paul E. Dixon -------------------------------------- Name: Paul E. Dixon Title: Vice President, General Counsel and Secretary Dated: October 24, 1996 5 6 INDEX TO EXHIBITS
ITEM DESCRIPTION - -------- --------------------------------------------------------------------------------- (a) (1) Form of Offer to Purchase dated October 24, 1996. (a) (2) Form of Letter of Transmittal. (a) (3) Form of Notice of Guaranteed Delivery. (a) (4) Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees. (a) (5) Form of Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and other Nominees. (a) (6) Form of Letter dated October 24, 1996 to shareholders from the Chairman and Chief Executive Officer of the Company. (a) (7) Form of Letter from the Company to participants in the Company Savings Plan, including the form of Direction Form to T. Rowe Price Trust Company, as Trustee, from participants in the Company savings plan. (a) (8) Form of Press Release issued by the Company dated October 22, 1996. (a) (9) Form of Summary Advertisement dated October 24, 1996. (a)(10) Guidelines for Certification of Taxpayer Identification Number on Form W-9. (b) (1) Revolving Credit Agreement dated as of September 28, 1994 (the "Revolving Credit Agreement") among the Company, certain financial institutions, as lenders, The Bank of Nova Scotia ("Scotiabank"), Chemical Bank and Bank of New York, as co-agents, and Scotiabank, as administrative agent (previously filed with the Commission as Exhibit 10.3 to the Company's Current Report on Form 8-K dated October 12, 1994 and incorporated by reference herein). (b) (2) First Amendment to the Revolving Credit Agreement, dated as of June 30, 1995. (b) (3) Second Amendment to the Revolving Credit Agreement, dated as of September 24, 1996. (b) (4) Third Amendment to the Revolving Credit Agreement, dated as of October 11, 1996. (g) (1) Pages 15 through 32 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 (incorporated by reference from the Company's Form 10-K filed with the Commission on March 28, 1996). (g) (2) Pages 19 through 36 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1994 (incorporated by reference from the Company's Form 10-K filed with the Commission on March 25, 1995). (g) (3) Pages 1 through 11 of the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1996 (incorporated by reference from the Company's Form 10-Q filed with the Commission on August 13, 1996). (g) (4) Pages 1 through 10 of the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1996 (incorporated herein by reference from the Company's Form 10-Q filed with the Commission on May 15, 1996).
EX-99.A1 2 OFFER TO PURCHASE 1 HANDY & HARMAN OFFER TO PURCHASE FOR CASH UP TO 1,800,000 SHARES OF ITS COMMON STOCK (INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS) AT A PURCHASE PRICE NOT GREATER THAN $20.00 NOR LESS THAN $17.50 PER SHARE THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY, NOVEMBER 21, 1996, UNLESS THE OFFER IS EXTENDED. Handy & Harman, a New York corporation (the "Company"), invites its shareholders to tender shares of its common stock, par value $1.00 per share (including the associated common stock purchase rights) (the "Shares"), to the Company at prices not greater than $20.00 nor less than $17.50 per Share in cash, specified by tendering shareholders, upon the terms and subject to the conditions set forth in this Offer to Purchase and the related Letter of Transmittal (which, as amended from time to time, together constitute the "Offer"). The Company will, upon the terms and subject to the conditions of the Offer, determine a single per Share price (not greater than $20.00 nor less than $17.50 per Share), net to the seller in cash (the "Purchase Price"), that it will pay for Shares validly tendered and not withdrawn pursuant to the Offer, taking into account the number of Shares so tendered and the prices specified by tendering shareholders. The Company will select the lowest Purchase Price that will allow it to buy 1,800,000 Shares validly tendered and not withdrawn pursuant to the Offer (or such lesser number of Shares as are validly tendered at prices not greater than $20.00 nor less than $17.50 per Share). The Company will pay the Purchase Price for all Shares validly tendered at prices at or below the Purchase Price and not withdrawn, upon the terms and subject to the conditions of the Offer including the proration terms hereof. The Company reserves the right, in its sole discretion, to purchase more than 1,800,000 Shares pursuant to the Offer. THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS. SEE SECTION 6. At a meeting of the Board of Directors of the Company held on October 24, 1996, the Board of Directors declared a regular quarterly dividend of $.06 per Share payable on December 3, 1996 to shareholders of record on November 15, 1996. Since the Expiration Date (as defined herein) will occur after November 15, 1996, holders of record on such date of Shares purchased in the Offer will be entitled to receive such dividend to be paid to shareholders of record as of such date regardless of whether such Shares are tendered pursuant to the Offer prior to, on or after November 15, 1996. The Shares are listed and principally traded on the New York Stock Exchange, Inc. (the "NYSE") under the symbol "HNH." On October 21, 1996, the last full trading day on the NYSE prior to announcement of the Offer, the closing per Share sales price as reported on the NYSE Composite Tape was $17.375. SHAREHOLDERS ARE URGED TO OBTAIN CURRENT MARKET QUOTATIONS FOR THE SHARES. SEE SECTION 7. THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE MAKING OF THE OFFER. HOWEVER, SHAREHOLDERS MUST MAKE THEIR OWN DECISIONS WHETHER TO TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND THE PRICE OR PRICES AT WHICH SHARES SHOULD BE TENDERED. NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO ANY SHAREHOLDER AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING SHARES. THE COMPANY HAS BEEN ADVISED THAT NONE OF ITS DIRECTORS OR EXECUTIVE OFFICERS INTENDS TO TENDER ANY SHARES PURSUANT TO THE OFFER. ------------------------ The Dealer Manager for the Offer is: J.P. MORGAN SECURITIES INC. The Date of this Offer to Purchase is October 24, 1996. 2 IMPORTANT Any shareholders desiring to tender all or any portion of their Shares should either (i) complete and sign the Letter of Transmittal or a facsimile thereof in accordance with the instructions in the Letter of Transmittal, mail or deliver it with any required signature guarantee and any other required documents to ChaseMellon Shareholder Services, L.L.C. (the "Depositary"), and either mail or deliver the stock certificates for such Shares to the Depositary (with all such other documents) or follow the procedure for book-entry delivery set forth in Section 3, or (ii) request a broker, dealer, commercial bank, trust company or other nominee to effect the transaction for such shareholder. A shareholder having Shares registered in the name of a broker, dealer, commercial bank, trust company or other nominee must contact that broker, dealer, commercial bank, trust company or other nominee if such shareholder desires to tender such Shares. Shareholders who desire to tender Shares and whose certificates for such Shares are not immediately available or who cannot comply with the procedure for book-entry transfer on a timely basis or whose other required documentation cannot be delivered to the Depositary, in any case, by the expiration of the Offer should tender such Shares by following the procedures for guaranteed delivery set forth in Section 3. TO EFFECT A VALID TENDER OF THEIR SHARES, SHAREHOLDERS MUST VALIDLY COMPLETE THE LETTER OF TRANSMITTAL, INCLUDING THE SECTION RELATING TO THE PRICE AT WHICH THEY ARE TENDERING SHARES. Questions and requests for assistance or for additional copies of this Offer to Purchase, the Letter of Transmittal or the Notice of Guaranteed Delivery may be directed to the Information Agent at its address and telephone number set forth on the back cover of this Offer to Purchase. 2 3 SUMMARY This general summary is provided for the convenience of the Company's shareholders and is qualified in its entirety by reference to the full text and more specific details of this Offer to Purchase. Number of Shares to be Purchased................ 1,800,000 Shares (or such lesser number of Shares as are validly tendered). Purchase Price............. The Company will determine a single per Share net cash price, not greater than $20.00 nor less than $17.50 per Share, that it will pay for Shares validly tendered. All Shares acquired in the Offer will be acquired at the Purchase Price even if tendered below the Purchase Price. Each shareholder desiring to tender Shares must specify in the Letter of Transmittal the minimum price (not greater than $20.00 nor less than $17.50 per Share) at which such shareholder is willing to have Shares purchased by the Company. How to Tender Shares....... See Section 3. Call the Information Agent or consult your broker for assistance. Dividends.................. See Section 7 for a discussion of payment of the next regular quarterly dividend. Brokerage Commissions...... None. Stock Transfer Tax......... None, if payment is made to the registered holder. Expiration and Proration Dates...................... Thursday, November 21, 1996, at 12:00 Midnight, New York City time, unless extended by the Company. Payment Date............... As soon as practicable after the Expiration Date. Position of the Company and its Directors.............. Neither the Company nor its Board of Directors makes any recommendation to any shareholder as to whether to tender or refrain from tendering Shares. Withdrawal Rights.......... Tendered Shares may be withdrawn at any time until 12:00 Midnight, New York City time, on Thursday, November 21, 1996, unless the Offer is extended by the Company and, unless previously purchased, after 12:00 Midnight, New York City time, on Friday, December 20, 1996. See Section 4. Odd Lots................... There will be no proration of Shares tendered by any shareholder owning beneficially fewer than 100 Shares in the aggregate (including Shares reflecting interests in the Company Stock Fund allocated to the Savings Plans but excluding Restricted Shares) as of October 23, 1996, and continues to beneficially own fewer than 100 Shares on the Expiration Date, and who tenders all such Shares at or below the Purchase Price prior to the Expiration Date and who checks the "Odd Lots" box in the Letter of Transmittal. Further Developments Regarding the Offer................ Call the Information Agent or consult your broker. 3 4 THE COMPANY HAS NOT AUTHORIZED ANY PERSON TO MAKE ANY RECOMMENDATION ON BEHALF OF THE COMPANY AS TO WHETHER SHAREHOLDERS SHOULD TENDER OR REFRAIN FROM TENDERING SHARES PURSUANT TO THE OFFER. THE COMPANY HAS NOT AUTHORIZED ANY PERSON TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION IN CONNECTION WITH THE OFFER ON BEHALF OF THE COMPANY OTHER THAN THOSE CONTAINED IN THIS OFFER TO PURCHASE OR IN THE LETTER OF TRANSMITTAL. DO NOT RELY ON ANY SUCH RECOMMENDATION OR ANY SUCH INFORMATION OR REPRESENTATION, IF GIVEN OR MADE, AS HAVING BEEN AUTHORIZED BY THE COMPANY. ------------------------ TABLE OF CONTENTS
SECTION PAGE - -------------------------------------------------------------------------------------- ---- INTRODUCTION.......................................................................... 5 THE OFFER............................................................................. 7 1. Number of Shares; Proration...................................................... 7 2. Tenders by Owners of Fewer than 100 Shares....................................... 8 3. Procedure for Tendering Shares................................................... 9 4. Withdrawal Rights................................................................ 13 5. Purchase of Shares and Payment of Purchase Price................................. 14 6. Certain Conditions of the Offer.................................................. 15 7. Price Range of Shares; Dividends................................................. 16 8. Background and Purpose of the Offer; Certain Effects of the Offer................ 17 9. Interests of Directors and Executive Officers; Transactions and Arrangements Concerning the Shares............................................................ 19 10. Source and Amount of Funds....................................................... 20 11. Certain Information about the Company............................................ 20 12. Effects of the Offer on the Market for Shares; Registration under the Exchange Act................................................................................. 24 13. Certain Legal Matters; Regulatory Approvals...................................... 24 14. Certain U.S. Federal Income Tax Consequences..................................... 25 15. Extension of the Offer; Termination; Amendments.................................. 27 16. Fees and Expenses................................................................ 27 17. Miscellaneous.................................................................... 28 SCHEDULE I-Certain Transactions Involving Shares...................................... S-1
4 5 TO THE HOLDERS OF SHARES OF COMMON STOCK OF HANDY & HARMAN: INTRODUCTION Handy & Harman, a New York corporation (the "Company"), invites its shareholders to tender shares of its common stock, par value $1.00 per share (including the associated common stock purchase rights) (the "Shares"), to the Company at prices not greater than $20.00 nor less than $17.50 per Share in cash, specified by tendering shareholders, upon the terms and subject to the conditions set forth in this Offer to Purchase and the related Letter of Transmittal (which, as amended from time to time, together constitute the "Offer"). The Company will, upon the terms and subject to the conditions of the Offer, determine a single per Share price (not greater than $20.00 nor less than $17.50 per Share), net to the seller in cash (the "Purchase Price"), that it will pay for Shares validly tendered and not withdrawn pursuant to the Offer, taking into account the number of Shares so tendered and the prices specified by tendering shareholders. The Company will select the lowest Purchase Price that will allow it to buy 1,800,000 Shares validly tendered and not withdrawn pursuant to the Offer (or such lesser number of Shares as are validly tendered at prices not greater than $20.00 nor less than $17.50 per Share). The Company will pay the Purchase Price for all Shares validly tendered prior to the Expiration Date (as defined in Section 1) at prices at or below the Purchase Price and not withdrawn upon the terms and subject to the conditions of the Offer including the proration terms described below. The Company reserves the right, in its sole discretion, to purchase more than 1,800,000 Shares pursuant to the Offer. THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS. SEE SECTION 6. If, before the Expiration Date, more than 1,800,000 Shares are validly tendered at or below the Purchase Price and not withdrawn (or such greater number of Shares as the Company may elect to purchase), the Company will, upon the terms and subject to the conditions of the Offer, purchase Shares first from all Odd Lot Owners (as defined in Section 2) who validly tender all their Shares at or below the Purchase Price and then on a pro rata basis from all other shareholders who validly tender Shares at prices at or below the Purchase Price (and do not withdraw them prior to the Expiration Date). The Company will return at its own expense all Shares not purchased pursuant to the Offer, including Shares tendered at prices greater than the Purchase Price and Shares not purchased because of proration. The Purchase Price will be paid net to the tendering shareholder in cash for all Shares purchased. Tendering shareholders will not be obligated to pay brokerage commissions, solicitation fees or, subject to Instruction 7 of the Letter of Transmittal, stock transfer taxes on the Company's purchase of Shares pursuant to the Offer. HOWEVER, ANY TENDERING SHAREHOLDER OR OTHER PAYEE WHO FAILS TO COMPLETE, SIGN AND RETURN TO THE DEPOSITARY (AS DEFINED BELOW) THE SUBSTITUTE FORM W-9 THAT IS INCLUDED WITH THE LETTER OF TRANSMITTAL MAY BE SUBJECT TO REQUIRED BACKUP FEDERAL INCOME TAX WITHHOLDING OF 31% OF THE GROSS PROCEEDS PAYABLE TO SUCH SHAREHOLDER OR OTHER PAYEE PURSUANT TO THE OFFER. SEE SECTION 3. In addition, the Company will pay all fees and expenses of J.P. Morgan Securities Inc. (the "Dealer Manager"), Georgeson & Company Inc. (the "Information Agent") and ChaseMellon Shareholder Services, L.L.C. (the "Depositary") in connection with the Offer. See Section 16. THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE MAKING OF THE OFFER. HOWEVER, SHAREHOLDERS MUST MAKE THEIR OWN DECISIONS WHETHER TO TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND THE PRICE OR PRICES AT WHICH SHARES SHOULD BE TENDERED. NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO ANY SHAREHOLDER AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING SHARES. THE COMPANY HAS BEEN ADVISED THAT NONE OF ITS DIRECTORS OR EXECUTIVE OFFICERS INTENDS TO TENDER ANY SHARES PURSUANT TO THE OFFER. 5 6 The Company is making the Offer to (i) use the Company's cash and proceeds realized upon the sale of a portion of the Company's precious metals inventory to improve the Company's capital structure and lower its cost of capital for the benefit of its shareholders, and (ii) afford to those shareholders who desire liquidity an opportunity to sell all or a portion of their Shares without the usual transaction costs associated with open market sales. The Offer also gives shareholders an opportunity to sell their Shares at a price greater than the prevailing market prices of the Shares immediately prior to the announcement of the Offer. After the Offer is completed, the Company expects to have sufficient cash flow and access to other sources of capital to fund its growth initiatives, including building its businesses and making strategic acquisitions. As of the close of business on October 16, 1996, there were 13,806,427 Shares outstanding and 942,631 Shares issuable upon exercise of outstanding stock options ("Options") under the Company's 1995 Omnibus Stock Incentive Plan and the Outside Director Stock Option Plan (collectively, the "Option Plans"). The 1,800,000 Shares that the Company is offering to purchase represent approximately 13.0% of the outstanding Shares (approximately 12.2% assuming the exercise of all outstanding Options). The Handy & Harman Savings Plan (the "Savings Plan"), a defined contribution 401(k) plan available to employees of the Company, holds Shares in accounts for participants thereunder. Participants may instruct the Handy & Harman Savings Plan Administrative Committee to direct T. Rowe Price Trust Company ("T. Rowe Price"), as trustee of the Savings Plan, to tender all or part of the Shares reflecting the participant's interest in the Shares held in the Company stock fund (the "Company Stock Fund") credited to a participant's individual account by following the instructions set forth in "Procedure for Tendering Shares -- Savings Plan" in Section 3. Additionally, certain shareholders have been issued restricted Shares ("Restricted Shares") pursuant to the provisions of the Company's Long-Term Incentive Plan (the "Stock Plan," and, collectively, with the Option Plans, the "Incentive Plans"). Pursuant to the provisions of the Stock Plan, Restricted Shares may not be tendered in the Offer unless the restriction period applicable to such Restricted Shares has expired. Shareholders who hold Restricted Shares should see "Procedure for Tendering Shares -- Restricted Shares" in Section 3. A tender of Shares pursuant to the Offer will include a tender of the associated common stock purchase rights (the "Rights"). No separate consideration will be paid for such Rights. Unless the context otherwise requires, all references in this Offer to Purchase to the Shares shall include the associated Rights. For a description of the Rights, see Section 7. The Shares are listed and principally traded on the New York Stock Exchange, Inc. ("NYSE") under the symbol "HNH." On October 21, 1996, the last full trading day on the NYSE prior to the announcement of the Offer, the closing per Share sales price as reported on the NYSE Composite Tape was $17.375. THE COMPANY URGES SHAREHOLDERS TO OBTAIN CURRENT QUOTATIONS ON THE MARKET PRICE OF THE SHARES. 6 7 THE OFFER 1. NUMBER OF SHARES; PRORATION Upon the terms and subject to the conditions of the Offer, the Company will accept for payment (and thereby purchase) 1,800,000 Shares or such lesser number of Shares as are validly tendered before the Expiration Date (and not withdrawn in accordance with Section 4) at a net cash price (determined in the manner set forth below) not greater than $20.00 nor less than $17.50 per Share. The term "Expiration Date" means 12:00 Midnight, New York City time, on Thursday, November 21, 1996, unless and until the Company in its sole discretion shall have extended the period of time during which the Offer is open, in which event the term "Expiration Date" shall refer to the latest time and date at which the Offer, as so extended by the Company, shall expire. See Section 15 for a description of the Company's right to extend the time during which the Offer is open and to delay, terminate or amend the Offer. Subject to Section 2, if the Offer is oversubscribed, Shares tendered at or below the Purchase Price before the Expiration Date will be eligible for proration. The proration period also expires on the Expiration Date. The Company will, upon the terms and subject to the conditions of the Offer, determine a single per Share Purchase Price that it will pay for Shares validly tendered and not withdrawn pursuant to the Offer, taking into account the number of Shares so tendered and the prices specified by tendering shareholders. The Company will select the lowest Purchase Price that will allow it to buy 1,800,000 Shares validly tendered and not withdrawn pursuant to the Offer (or such lesser number as are validly tendered at prices not greater than $20.00 nor less than $17.50 per Share). The Company reserves the right, in its sole discretion, to purchase more than 1,800,000 Shares pursuant to the Offer. See Section 15. In accordance with applicable regulations of the Securities and Exchange Commission (the "Commission"), the Company may purchase pursuant to the Offer an additional amount of Shares not to exceed 2% of the outstanding Shares without amending or extending the Offer. If (i) the Company increases or decreases the price to be paid for Shares, the Company increases or decreases the Dealer Manager's fee, the Company increases the number of Shares being sought and such increase in the number of Shares being sought exceeds 2% of the outstanding Shares, or the Company decreases the number of Shares being sought and (ii) the Offer is scheduled to expire at any time earlier than the expiration of a period ending on the tenth business day from, and including, the date that notice of such increase or decrease is first published, sent or given in the manner specified in Section 15, the Offer will be extended until the expiration of such period of ten business days. For purposes of the Offer, a "business day" means any day other than a Saturday, Sunday or federal holiday and consists of the time period from 12:01 A.M. through 12:00 Midnight, New York City time. THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS. SEE SECTION 6. In accordance with Instruction 5 of the Letter of Transmittal, each shareholder desiring to tender Shares must specify the price (not greater than $20.00 nor less than $17.50 per Share) at which such shareholder is willing to have the Company purchase Shares. As promptly as practicable following the Expiration Date, the Company will, in its sole discretion, determine the Purchase Price (not greater than $20.00 nor less than $17.50 per Share) that it will pay for Shares validly tendered and not withdrawn pursuant to the Offer, taking into account the number of Shares so tendered and the prices specified by tendering shareholders. The Company will pay the Purchase Price, even if such Shares were tendered below the Purchase Price, for all Shares validly tendered prior to the Expiration Date at prices at or below the Purchase Price and not withdrawn, upon the terms and subject to the conditions of the Offer. All Shares not purchased pursuant to the Offer, including Shares tendered at prices greater than the Purchase Price and Shares not purchased because of proration, will be returned to the tendering shareholders at the Company's expense as promptly as practicable following the Expiration Date. If the number of Shares validly tendered at or below the Purchase Price and not withdrawn prior to the Expiration Date is less than or equal to 1,800,000 Shares (or such greater number of Shares as the Company 7 8 may elect to purchase pursuant to the Offer), the Company will, upon the terms and subject to the conditions of the Offer, purchase at the Purchase Price all Shares so tendered. Priority. Upon the terms and subject to the conditions of the Offer, in the event that prior to the Expiration Date more than 1,800,000 Shares (or such greater number of Shares as the Company may elect to purchase pursuant to the Offer) are validly tendered at or below the Purchase Price and not withdrawn, the Company will purchase such validly tendered Shares in the following order of priority: (i) all Shares validly tendered at or below the Purchase Price and not withdrawn prior to the Expiration Date by any Odd Lot Owner (as defined in Section 2) who: (a) tenders all Shares (including Shares attributable to individual accounts under the Savings Plan but excluding Restricted Shares) beneficially owned by such Odd Lot Owner at or below the Purchase Price (partial tenders will not qualify for this preference); and (b) completes the box captioned "Odd Lots" on the Letter of Transmittal (or, in the case of Savings Plan Participants (as defined below) holding Odd Lots, the Direction Form (as defined below) sent to such Participants (see Section 3)) and, if applicable, on the Notice of Guaranteed Delivery; and (ii) after purchase of all of the foregoing Shares, all other Shares validly tendered at or below the Purchase Price and not withdrawn prior to the Expiration Date on a pro rata basis. Proration. In the event that proration of tendered Shares is required, the Company will determine the final proration factor as promptly as practicable after the Expiration Date. Proration for each shareholder tendering Shares (other than Odd Lot Owners) shall be based on the ratio of the number of Shares tendered by such shareholder at or below the Purchase Price to the total number of Shares tendered by all shareholders (other than Odd Lot Owners) at or below the Purchase Price. This ratio will be applied to shareholders tendering Shares (other than Odd Lot Owners) to determine the number of Shares that will be purchased from each such shareholder pursuant to the Offer. Although the Company does not expect to be able to announce the final results of such proration until approximately seven business days after the Expiration Date, it will announce preliminary results of proration by press release as promptly as practicable after the Expiration Date. Shareholders can obtain such preliminary information from the Information Agent and may be able to obtain such information from their brokers. As described in Section 14, the number of Shares that the Company will purchase from a shareholder may affect the United States federal income tax consequences to the shareholder of such purchase and therefore may be relevant to a shareholder's decision whether to tender Shares. The Letter of Transmittal affords each tendering shareholder the opportunity to designate the order of priority in which Shares tendered are to be purchased in the event of proration. This Offer to Purchase and the related Letter of Transmittal will be mailed to record holders of Shares as of October 23, 1996 and will be furnished to brokers, banks and similar persons whose names, or the names of whose nominees, appear on the Company's shareholder list or, if applicable, who are listed as participants in a clearing agency's security position listing for subsequent transmittal to beneficial owners of Shares. 2. TENDERS BY OWNERS OF FEWER THAN 100 SHARES The Company, upon the terms and subject to the conditions of the Offer, will accept for purchase, without proration, all Shares validly tendered at or below the Purchase Price and not withdrawn on or prior to the Expiration Date by or on behalf of shareholders who beneficially owned as of the close of business on October 23, 1996, and continue to beneficially own as of the Expiration Date, an aggregate of fewer than 100 Shares, including Shares attributable to individual accounts under the Savings Plan but excluding any Restricted Shares ("Odd Lot Owners"). See Section 1. To avoid proration, however, an Odd Lot Owner must validly tender at or below the Purchase Price all such Shares (including Shares attributable to individual accounts under the Savings Plan but excluding Restricted Shares) that such Odd Lot Owner beneficially owns; partial tenders will not qualify for this preference. This preference is not available to partial tenders or to 8 9 owners of 100 or more Shares in the aggregate (including Shares attributable to individual accounts under the Savings Plan but excluding Restricted Shares), even if such owners have separate stock certificates for fewer than 100 such Shares. Any Odd Lot Owner wishing to tender all such Shares beneficially owned by such shareholder pursuant to this Offer must complete the box captioned "Odd Lots" in the Letter of Transmittal (or, with respect to Participants in the Savings Plan who are Odd Lot Owners, the Direction Form (as defined below) sent to such Participants) and, if applicable, on the Notice of Guaranteed Delivery and must properly indicate in the section entitled "Price (In Dollars) Per Share At Which Shares Are Being Tendered" in the Letter of Transmittal (or the Direction Form, if applicable) the price at which such Shares are being tendered, except that an Odd Lot Owner may check the box in the section entitled "Odd Lots" indicating that the shareholder is tendering all of such shareholder's Shares (including Shares attributable to individual accounts under the Savings Plan but excluding Restricted Shares) at the Purchase Price. See Section 3. Shareholders owning an aggregate of less than 100 Shares whose Shares are purchased pursuant to the Offer will avoid both the payment of brokerage commissions and any applicable odd lot discounts payable on a sale of their Shares in transactions on a stock exchange, including the NYSE. The Company also reserves the right, but will not be obligated, to purchase all Shares duly tendered by any shareholder who tendered any Shares beneficially owned at or below the Purchase Price and who, as a result of proration, would then beneficially own an aggregate of fewer than 100 Shares. If the Company exercises this right, it will increase the number of Shares that it is offering to purchase in the Offer by the number of Shares purchased through the exercise of such right. 3. PROCEDURE FOR TENDERING SHARES Proper Tender of Shares. For Shares to be validly tendered pursuant to the Offer: (i) the certificates for such Shares (or confirmation of receipt of such Shares pursuant to the procedures for book-entry transfer set forth below), together with a properly completed and duly executed Letter of Transmittal (or manually signed facsimile thereof) with any required signature guarantees, and any other documents required by the Letter of Transmittal, must be received prior to 12:00 Midnight, New York City time, on the Expiration Date by the Depositary at its address set forth on the back cover of this Offer to Purchase; or (ii) the tendering shareholder must comply with the guaranteed delivery procedure set forth below. AS SPECIFIED IN INSTRUCTION 5 OF THE LETTER OF TRANSMITTAL, EACH SHAREHOLDER DESIRING TO TENDER SHARES PURSUANT TO THE OFFER MUST PROPERLY INDICATE IN THE SECTION CAPTIONED "PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED" IN THE LETTER OF TRANSMITTAL THE PRICE (IN MULTIPLES OF $.25) AT WHICH SUCH SHAREHOLDER'S SHARES ARE BEING TENDERED, EXCEPT THAT AN ODD LOT OWNER MAY CHECK THE BOX IN THE SECTION OF THE LETTER OF TRANSMITTAL ENTITLED "ODD LOTS" INDICATING THAT THE SHAREHOLDER IS TENDERING ALL OF SUCH SHAREHOLDER'S SHARES AT THE PURCHASE PRICE. Shareholders desiring to tender Shares at more than one price must complete separate Letters of Transmittal for each price at which Shares are being tendered, except that the same Shares cannot be tendered (unless properly withdrawn previously in accordance with the terms of the Offer) at more than one price. IN ORDER TO VALIDLY TENDER SHARES, ONE AND ONLY ONE PRICE BOX MUST BE CHECKED IN THE APPROPRIATE SECTION ON EACH LETTER OF TRANSMITTAL. In addition, Odd Lot Owners who tender all Shares must complete the section entitled "Odd Lots" on the Letter of Transmittal (or, in the case of Savings Plan Participants holding Odd Lots, the Direction Form sent to such Participants (see Savings Plan, below)) and, if applicable, on the Notice of Guaranteed Delivery, in order to qualify for the preferential treatment available to Odd Lot Owners as set forth in Section 2. Signature Guarantees and Method of Delivery. No signature guarantee is required on the Letter of Transmittal if (i) the Letter of Transmittal is signed by the registered holder of the Shares (which term, for purposes of this Section, includes any participant in The Depository Trust Company or the Philadelphia Depository Trust Company (the "Book-Entry Transfer Facilities") whose name appears on a security position listing as the holder of the Shares) tendered therewith and payment and delivery are to be made directly to such registered holder, or (ii) if Shares are tendered for the account of a firm or other entity that is a member 9 10 in good standing of the Security Transfer Agent's Medallion Program, the New York Stock Exchange Medallion Program or the Stock Exchange Medallion Program (an "Eligible Institution"). In this regard see Section 5 for information with respect to applicable stock transfer taxes. In all other cases, all signatures on the Letter of Transmittal must be guaranteed by an Eligible Institution. See Instruction 1 of the Letter of Transmittal. If a certificate representing Shares is registered in the name of a person other than the signer of a Letter of Transmittal, or if payment is to be made, or Shares not purchased or tendered are to be issued, to a person other than the registered holder, the certificate must be endorsed or accompanied by an appropriate stock power, in either case signed exactly as the name of the registered holder appears on the certificate, with the signature on the certificate or stock power guaranteed by an Eligible Institution. In all cases, payment for Shares tendered and accepted for payment pursuant to the Offer will be made only after timely receipt by the Depositary of certificates for such Shares (or a timely confirmation of a book-entry transfer of such Shares into the Depositary's account at one of the Book-Entry Transfer Facilities as described below), a properly completed and duly executed Letter of Transmittal (or manually signed facsimile thereof) and any other documents required by the Letter of Transmittal. THE METHOD OF DELIVERY OF ALL DOCUMENTS, INCLUDING SHARE CERTIFICATES, THE LETTER OF TRANSMITTAL AND ANY OTHER REQUIRED DOCUMENTS, IS AT THE ELECTION AND RISK OF THE TENDERING SHAREHOLDER. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. Book-Entry Delivery. The Depositary will establish an account with respect to the Shares at each of the BookEntry Transfer Facilities for purposes of the Offer within two business days after the date of this Offer to Purchase. Any financial institution that is a participant in a Book-Entry Transfer Facility's system may make book-entry delivery of the Shares by causing such facility to transfer such Shares into the Depositary's account in accordance with such facility's procedure for such transfer. Even though delivery of Shares may be effected through book-entry transfer into the Depositary's account at one of the Book-Entry Transfer Facilities, a properly completed and duly executed Letter of Transmittal (or manually signed facsimile thereof), with any required signature guarantees and other required documents must, in any case, be transmitted to and received by the Depositary at one of its addresses set forth on the back cover of this Offer to Purchase prior to the Expiration Date, or the guaranteed delivery procedure set forth below must be followed. DELIVERY OF THE LETTER OF TRANSMITTAL AND ANY OTHER REQUIRED DOCUMENTS TO ONE OF THE BOOK-ENTRY TRANSFER FACILITIES DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY. Guaranteed Delivery. If a shareholder desires to tender Shares pursuant to the Offer and such shareholder's Share certificates cannot be delivered to the Depositary prior to the Expiration Date (or the procedures for book-entry transfer cannot be completed on a timely basis) or time will not permit all required documents to reach the Depositary before the Expiration Date, such Shares may nevertheless be tendered provided that all of the following conditions are satisfied: (i) such tender is made by or through an Eligible Institution; (ii) the Depositary receives (by hand, mail, overnight courier, telegram or facsimile transmission), on or prior to the Expiration Date, a properly completed and duly executed Notice of Guaranteed Delivery substantially in the form the Company has provided with this Offer to Purchase (indicating the price at which the Shares are being tendered), including (where required) a signature guarantee by an Eligible Institution in the form set forth in such Notice of Guaranteed Delivery; and (iii) the certificates for all tendered Shares in proper form for transfer (or confirmation of book-entry transfer of such Shares into the Depositary's account at one of the Book-Entry Transfer Facilities), together with a properly completed and duly executed Letter of Transmittal (or manually signed facsimile thereof) and any required signature guarantees or other documents required by the Letter of Transmittal, are received by the Depositary no later than 5:00 p.m., New York City time, on the third NYSE trading day after the date the Depositary receives such Notice of Guaranteed Delivery. 10 11 If any tendered Shares are not purchased, or if less than all Shares evidenced by a shareholder's certificates are tendered, certificates for unpurchased Shares will be returned as promptly as practicable after the expiration or termination of the Offer or, in the case of Shares tendered by book-entry transfer at a Book-Entry Transfer Facility, such Shares will be credited to the appropriate account maintained by the tendering shareholder at the appropriate Book-Entry Transfer Facility, in each case without expense to such shareholder. Backup Federal Income Tax Withholding. Under the United States federal income tax backup withholding rules, unless an exemption applies under the applicable law and regulations, 31% of the gross proceeds payable to a shareholder or other payee pursuant to the Offer must be withheld and remitted to the United States Treasury, unless the shareholder or other payee provides such person's taxpayer identification number (employer identification number or social security number) to the Depositary and certifies under penalties of perjury that such number is correct. Therefore, each tendering shareholder should complete and sign the Substitute Form W-9 included as part of the Letter of Transmittal so as to provide the information and certification necessary to avoid backup withholding, unless such shareholder otherwise establishes to the satisfaction of the Depositary that the shareholder is not subject to backup withholding. Certain shareholders (including, among others, all corporations and certain foreign shareholders (in addition to foreign corporations)) are not subject to these backup withholding and reporting requirements. In order for a foreign shareholder to qualify as an exempt recipient, that shareholder must submit an IRS Form W-8 or a Substitute Form W-8, signed under penalties of perjury, attesting to that shareholder's exempt status. Such statements can be obtained from the Depositary. See Instructions 10 and 11 of the Letter of Transmittal. TO PREVENT BACKUP FEDERAL INCOME TAX WITHHOLDING EQUAL TO 31% OF THE GROSS PAYMENTS MADE TO SHAREHOLDERS FOR SHARES PURCHASED PURSUANT TO THE OFFER, EACH SHAREHOLDER WHO DOES NOT OTHERWISE ESTABLISH AN EXEMPTION FROM SUCH WITHHOLDING MUST PROVIDE THE DEPOSITARY WITH THE SHAREHOLDER'S CORRECT TAXPAYER IDENTIFICATION NUMBER AND PROVIDE CERTAIN OTHER INFORMATION BY COMPLETING THE SUBSTITUTE FORM W-9 INCLUDED WITH THE LETTER OF TRANSMITTAL. For a discussion of certain United States federal income tax consequences to tendering shareholders, see Section 14. Withholding For Foreign Shareholders. Even if a foreign shareholder has provided the required certification to avoid backup withholding, the Depositary will withhold United States federal income taxes equal to 30% of the gross payments payable to a foreign shareholder or his or her agent unless the Depositary determines that a reduced rate of withholding is available pursuant to a tax treaty or that an exemption from withholding is applicable because such gross proceeds are effectively connected with the conduct of a trade or business within the United States. For this purpose, a foreign shareholder is any shareholder that is not (i) a citizen or resident of the United States, (ii) a corporation, partnership, or other entity created or organized in or under the laws of the United States, any State or any political subdivision thereof or (iii) an estate or trust the income of which is subject to United States federal income taxation regardless of the source of such income. In order to obtain a reduced rate of withholding pursuant to a tax treaty, a foreign shareholder must deliver to the Depositary before the payment a properly completed and executed IRS Form 1001. In order to obtain an exemption from withholding on the grounds that the gross proceeds paid pursuant to the Offer are effectively connected with the conduct of a trade or business within the United States, a foreign shareholder must deliver to the Depositary a properly completed and executed IRS Form 4224. The Depositary will determine a shareholder's status as a foreign shareholder and eligibility for a reduced rate of, or exemption from, withholding by reference to any outstanding certificates or statements concerning eligibility for a reduced rate of, or exemption from, withholding (e.g., IRS Form 1001 or IRS Form 4224) unless facts and circumstances indicate that such reliance is not warranted. A foreign shareholder may be eligible to obtain a refund of all or a portion of any tax withheld if such shareholder meets the "complete redemption", "substantially disproportionate" or "not essentially equivalent to a dividend" test described in Section 14 or is otherwise able to establish that no tax or a reduced amount of tax is due. Backup withholding generally will not apply to amounts subject to the 30% or a treaty-reduced rate of withholding. Foreign shareholders are 11 12 urged to consult their own tax advisors regarding the application of United States federal income tax withholding, including eligibility for a withholding tax reduction or exemption, and the refund procedure. See Instructions 10 and 11 of the Letter of Transmittal. Savings Plan. As of October 17, 1996, the Savings Plan held 183,539 Shares, all of which were held in the Company Stock Fund under the Savings Plan. Interests in the Company Stock Fund are credited to the individual accounts of the Savings Plan participants, beneficiaries of deceased participants and alternate payees pursuant to qualified domestic relations orders (collectively referred to as "Participants"). Such Shares will, subject to the limitations of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and applicable regulations thereunder, be tendered (or not tendered) by T. Rowe Price, as trustee of the Savings Plan, according to the instructions of Participants to the Plan Administrative Committee and T. Rowe Price. Shares for which the Plan Administrative Committee and T. Rowe Price have not received timely instructions from Participants will not be tendered by T. Rowe Price, in accordance with the terms of the Savings Plan and the applicable trust agreements. T. Rowe Price will make available to Participants whose individual accounts are credited with Shares all documents furnished to shareholders generally in connection with the Offer. Each such Participant will also receive a form (the "Direction Form") upon which the Participant may instruct the Plan Administrative Committee and T. Rowe Price regarding the Offer. Each Participant may direct that all, some or none of the Shares attributable to such Participant's account under the Savings Plan be tendered and the price at which such Shares are to be tendered. All of the Shares of any Participant whose individual account is credited with less than 100 Shares and tenders all of such Shares in accordance with Section 2 hereof will be purchased by the Company without proration. See Section 2. The Company will also provide additional information in a separate letter with respect to the application of the Offer to Participants in the Savings Plan. PARTICIPANTS IN THE SAVINGS PLAN MAY NOT USE THE LETTER OF TRANSMITTAL TO DIRECT THE TENDER OF THE SHARES ATTRIBUTABLE TO THEIR INDIVIDUAL ACCOUNTS, BUT MUST USE THE DIRECTION FORM SENT TO THEM. PARTICIPANTS IN THE SAVINGS PLAN ARE URGED TO READ THE DIRECTION FORM AND RELATED MATERIALS CAREFULLY. All proceeds received by T. Rowe Price on account of Shares purchased from the Savings Plan will be reinvested in the T. Rowe Price Prime Reserve Account as soon as administratively possible and such investment will be credited to the plan Participant's individual account. Participants may contact T. Rowe Price after the reinvestment is complete at 1(800)922-9945 to have any proceeds of the sale of Shares that were reinvested in the T. Rowe Price Prime Reserve Account invested in a different manner subject to the provisions of the Savings Plan. Restricted Shares. Certain shareholders have been issued Restricted Shares pursuant to the provisions of the Stock Plan. Pursuant to the provisions of the Stock Plan, certificates representing Restricted Shares granted to Stock Plan participants must remain deposited with the Company until the expiration of the applicable restriction period (determined in accordance with the provisions of the Stock Plan) and cannot be tendered in the Offer or otherwise transferred by the participant until the expiration of the applicable restriction period. Upon the expiration of such applicable restriction period and pursuant to the provisions of the Stock Plan, such Restricted Shares shall no longer be restricted and may be tendered pursuant to the Offer. Restricted Shares as to which the applicable restriction period has expired shall thereafter be deemed Shares. Shareholders may tender such Restricted Shares (as to which they have been informed by the Company that the applicable restriction period has expired) as Shares pursuant to the Offer by following the instructions for tendering Shares set forth herein. Any questions with respect to the status of any Restricted Shares or as to when restrictions with respect to a particular plan participant's Restricted Shares expire may be directed to Stephen B. Mudd or Paul E. Dixon at (914) 921-5200. RESTRICTED SHARES AS TO WHICH THE APPLICABLE RESTRICTION PERIOD HAS NOT EXPIRED MAY NOT BE TENDERED PURSUANT TO THE OFFER. Tendering Shareholder's Representation and Warranty; Company's Acceptance Constitutes an Agreement. It is a violation of Rule 14e-4 promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), for a person acting alone or in concert with others, directly or indirectly, to tender Shares for such person's own account unless at the time of tender and at the Expiration Date such person has a "net long position" equal to or greater than the amount tendered in (a) the Shares and will deliver or cause to be delivered such Shares for the purpose of tender to the Company within the period specified in the Offer, or (b) other securities immediately convertible into, exercisable for or exchangeable into Shares ("Equivalent 12 13 Securities") and, upon the acceptance of such tender, will acquire such Shares by conversion, exchange or exercise of such Equivalent Securities to the extent required by the terms of the Offer and will deliver or cause to be delivered such Shares so acquired for the purpose of tender to the Company within the period specified in the Offer. Rule 14e-4 also provides a similar restriction applicable to the tender or guarantee of a tender on behalf of another person. A tender of Shares made pursuant to any method of delivery set forth herein will constitute the tendering shareholder's representation and warranty to the Company that (a) such shareholder has a "net long position" in Shares or Equivalent Securities being tendered within the meaning of Rule 14e-4, and (b) such tender of Shares complies with Rule 14e-4. The Company's acceptance for payment of Shares tendered pursuant to the Offer will constitute a binding agreement between the tendering shareholder and the Company upon the terms and subject to the conditions of the Offer. Determinations of Validity; Rejection of Shares; Waiver of Defects; No Obligation to Give Notice of Defects. All questions as to the number of Shares to be accepted, the price to be paid therefor and the validity, form, eligibility (including time of receipt) and acceptance for payment of any tender of Shares will be determined by the Company, in its sole discretion, which determination shall be final and binding on all parties. The Company reserves the absolute right to reject any or all tenders it determines not to be in proper form or the acceptance of or payment for which may, in the opinion of the Company's counsel, be unlawful. The Company also reserves the absolute right to waive any of the conditions of the Offer and any defect or irregularity in the tender of any particular Shares or any particular shareholder. No tender of Shares will be deemed to be properly made until all defects or irregularities have been cured or waived. None of the Company, the Dealer Manager, the Depositary, the Information Agent or any other person is or will be obligated to give notice of any defects or irregularities in tenders, and none of them will incur any liability for failure to give any such notice. CERTIFICATES FOR SHARES, TOGETHER WITH A PROPERLY COMPLETED LETTER OF TRANSMITTAL AND ANY OTHER DOCUMENTS REQUIRED BY THE LETTER OF TRANSMITTAL, MUST BE DELIVERED TO THE DEPOSITARY AND NOT TO THE COMPANY. ANY SUCH DOCUMENTS DELIVERED TO THE COMPANY WILL NOT BE FORWARDED TO THE DEPOSITARY AND THEREFORE WILL NOT BE DEEMED TO BE VALIDLY TENDERED. 4. WITHDRAWAL RIGHTS Except as otherwise provided in this Section 4, tenders of Shares pursuant to the Offer are irrevocable. Shares tendered pursuant to the Offer may be withdrawn at any time before the Expiration Date and, unless accepted for payment by the Company as provided in this Offer to Purchase, may also be withdrawn after 12:00 Midnight, New York City time, on Friday, December 20, 1996. For a withdrawal to be effective, the Depositary must receive (at its address set forth on the back cover of this Offer to Purchase) a notice of withdrawal in written, telegraphic or facsimile transmission form on a timely basis. Such notice of withdrawal must specify the name of the person who tendered the Shares to be withdrawn, the number of Shares tendered, the number of Shares to be withdrawn and the name of the registered holder, if different from that of the person who tendered such Shares. If the certificates have been delivered or otherwise identified to the Depositary, then, prior to the release of such certificates, the tendering shareholder must also submit the serial numbers shown on the particular certificates evidencing the Shares and the signature on the notice of withdrawal must be guaranteed by an Eligible Institution (except in the case of Shares tendered by an Eligible Institution). If Shares have been tendered pursuant to the procedure for bookentry transfer set forth in Section 3, the notice of withdrawal must specify the name and the number of the account at the applicable Book-Entry Transfer Facility to be credited with the withdrawn Shares and otherwise comply with the procedures of such facility. All questions as to the form and validity, including time of receipt, of notices of withdrawal will be determined by the Company, in its sole discretion, which determination shall be final and binding on all parties. None of the Company, the Dealer Manager, the Depositary, the Information Agent or any other person is or will be obligated to give any notice of any defects or irregularities in any notice of withdrawal, and none of them will incur any liability for failure to give any such notice. Withdrawals may not be rescinded, and any Shares properly withdrawn will thereafter be deemed 13 14 not tendered for purposes of the Offer. However, withdrawn Shares may be re-tendered before the Expiration Date by again following any of the procedures described in Section 3. If the Company extends the Offer, is delayed in its purchase of Shares or is unable to purchase Shares pursuant to the Offer for any reason, then, without prejudice to the Company's rights under the Offer, the Depositary may, subject to applicable law, retain on behalf of the Company all tendered Shares, and such Shares may not be withdrawn except to the extent tendering shareholders are entitled to withdrawal rights as described in this Section 4. Participants in the Savings Plan should disregard the foregoing procedures with respect to Shares attributable to their individual accounts in the Savings Plan and should follow the procedures for withdrawal included in the letter furnished to such participants by the Company. 5. PURCHASE OF SHARES AND PAYMENT OF PURCHASE PRICE The Company will, upon the terms and subject to the conditions of the Offer, determine a single per Share Purchase Price that it will pay for Shares validly tendered and not withdrawn pursuant to the Offer, taking into account the number of Shares so tendered and the prices specified by tendering shareholders, and will accept for payment and pay for (and thereby purchase) Shares validly tendered at or below the Purchase Price and not withdrawn as soon as practicable after the Expiration Date. For purposes of the Offer, the Company will be deemed to have accepted for payment (and therefore purchased), subject to proration, Shares that are validly tendered at or below the Purchase Price and not withdrawn when, as and if it gives oral or written notice to the Depositary of its acceptance of such Shares for payment pursuant to the Offer. Upon the terms and subject to the conditions of the Offer, the Company will purchase and pay a single per Share Purchase Price for all of the Shares accepted for payment pursuant to the Offer as soon as practicable after the Expiration Date. In all cases, payment for Shares tendered and accepted for payment pursuant to the Offer will be made promptly (subject to possible delay in the event of proration) but only after timely receipt by the Depositary of certificates for Shares (or of a timely confirmation of a book-entry transfer of such Shares into the Depositary's account at one of the Book-Entry Transfer Facilities), a properly completed and duly executed Letter of Transmittal (or manually signed facsimile thereof) and any other required documents. Payment for Shares purchased pursuant to the Offer will be made by depositing the aggregate Purchase Price therefor with the Depositary, which will act as agent for tendering shareholders for the purpose of receiving payment from the Company and transmitting payment to the tendering shareholders. In the event of proration, the Company will determine the proration factor and pay for those tendered Shares accepted for payment as soon as practicable after the Expiration Date. However, the Company does not expect to be able to announce the final results of any such proration until approximately seven business days after the Expiration Date. Under no circumstances will the Company pay interest on the Purchase Price including, without limitation, by reason of any delay in making payment. Certificates for all Shares not purchased, including all Shares tendered at prices greater than the Purchase Price and Shares not purchased due to proration, will be returned (or, in the case of Shares tendered by book-entry transfer, such Shares will be credited to the account maintained with one of the Book-Entry Transfer Facilities by the participant who so delivered such Shares) as promptly as practicable following the Expiration Date or termination of the Offer without expense to the tendering shareholder. In addition, if certain events occur, the Company may not be obligated to purchase Shares pursuant to the Offer. See Section 6. The Company will pay all stock transfer taxes, if any, payable on the transfer to it of Shares purchased pursuant to the Offer; provided, however, that if payment of the Purchase Price is to be made to, or (in the circumstances permitted by the Offer) if unpurchased Shares are to be registered in the name of, any person other than the registered holder, or if tendered certificates are registered in the name of any person other than the person signing the Letter of Transmittal, the amount of all stock transfer taxes, if any (whether imposed on the registered holder or such other person), payable on account of the transfer to such person will be deducted from the Purchase Price unless evidence satisfactory to the Company of the payment of such taxes or exemption therefrom is submitted. See Instruction 7 of the Letter of Transmittal. 14 15 ANY TENDERING SHAREHOLDER OR OTHER PAYEE WHO FAILS TO COMPLETE FULLY, SIGN AND RETURN TO THE DEPOSITARY THE SUBSTITUTE FORM W-9 INCLUDED WITH THE LETTER OF TRANSMITTAL MAY BE SUBJECT TO REQUIRED BACKUP FEDERAL INCOME TAX WITHHOLDING OF 31% OF THE GROSS PROCEEDS PAID TO SUCH SHAREHOLDER OR OTHER PAYEE PURSUANT TO THE OFFER. SEE SECTION 3. ALSO SEE SECTION 3 REGARDING FEDERAL INCOME TAX CONSEQUENCES FOR FOREIGN SHAREHOLDERS. 6. CERTAIN CONDITIONS OF THE OFFER Notwithstanding any other provision of the Offer, the Company shall not be required to accept for payment, purchase or pay for any Shares tendered, and may terminate or amend the Offer or may postpone the acceptance for payment of, or the purchase of and the payment for Shares tendered, subject to Rule 13e-4(f) promulgated under the Exchange Act, if at any time on or after October 22, 1996 and prior to the time of payment for any such Shares (whether any Shares have theretofore been accepted for payment, purchased or paid for pursuant to the Offer) any of the following events shall have occurred (or shall have been determined by the Company to have occurred) that, in the Company's judgment in any such case and regardless of the circumstances giving rise thereto (including any action or omission to act by the Company), makes it inadvisable to proceed with the Offer or with such acceptance for payment or payment: (a) there shall have been threatened, instituted or be pending before any court, agency, authority or other tribunal any action, suit or proceeding by any government or governmental, regulatory or administrative agency or authority or by any other person, domestic or foreign, or any judgment, order or injunction entered, enforced or deemed applicable by any such court, authority, agency or tribunal, which (i) challenges or seeks to make illegal, or to delay or otherwise directly or indirectly to restrain, prohibit or otherwise affect the making of the Offer, the acquisition of Shares pursuant to the Offer or is otherwise related in any manner to, or otherwise affects, the Offer; or (ii) could, in the sole judgment of the Company, materially affect the business, condition (financial or other), income, operations or prospects of the Company and its subsidiaries, taken as a whole, or otherwise materially impair in any way the contemplated future conduct of the business of the Company and its subsidiaries, taken as a whole, or materially impair the Offer's contemplated benefits to the Company; or (b) there shall have been any action threatened or taken, or any approval withheld, or any statute, rule or regulation invoked, proposed, sought, promulgated, enacted, entered, amended, enforced or deemed to be applicable to the Offer or the Company or any of its subsidiaries, by any government or governmental, regulatory or administrative authority or agency or tribunal, domestic or foreign, which, in the sole judgment of the Company, would or might directly or indirectly result in any of the consequences referred to in clause (i) or (ii) of paragraph (a) above; or (c) there shall have occurred (i) the declaration of any banking moratorium or any suspension of payments in respect of banks in the United States (whether or not mandatory); (ii) any general suspension of trading in, or limitation on prices for, securities on any United States national securities exchange or in the over-the-counter market; (iii) the commencement of a war, armed hostilities or any other national or international crisis directly or indirectly involving the United States; (iv) any limitation (whether or not mandatory) by any governmental, regulatory or administrative agency or authority on, or any event which, in the sole judgment of the Company might materially affect, the extension of credit by banks or other lending institutions in the United States; (v) any significant decrease in the market price of the Shares or in the market prices of equity securities generally in the United States or any change in the general political, market, economic or financial conditions in the United States or abroad that could have in the sole judgment of the Company a material adverse effect on the business, condition (financial or otherwise), income, operations or prospects of the Company and its subsidiaries, taken as a whole, or on the trading in the Shares or on the proposed financing of the Offer; (vi) in the case of any of the foregoing existing at the time of the announcement of the Offer, a material acceleration or worsening thereof; or (vii) any decline in either the Dow Jones Industrial Average or the S&P 500 Composite Index by an amount in excess of 10% measured from the close of business on October 22, 1996; or 15 16 (d) any change shall occur or be threatened in the business, condition (financial or other), income, operations or prospects of the Company and its subsidiaries, taken as a whole, which in the sole judgment of the Company is or may be material to the Company and its subsidiaries taken as a whole; or (e) it shall have been publicly disclosed or the Company shall have learned that (i) any person or "group" (within the meaning of Section 13(d)(3) of the Exchange Act) has acquired or proposes to acquire beneficial ownership of more than 5% of the outstanding Shares whether through the acquisition of stock, the formation of a group, the grant of any option or right, or otherwise (other than as disclosed in a Schedule 13D or 13G on file with the Commission on October 22, 1996) or (ii) any such person or group that on or prior to October 22, 1996 had filed such a Schedule with the Commission thereafter shall have acquired or shall propose to acquire whether through the acquisition of stock, the formation of a group, the grant of any option or right, or otherwise, beneficial ownership of additional Shares representing 2% or more of the outstanding Shares; or (f) any person or group shall have filed a Notification and Report Form under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 reflecting an intent to acquire the Company or any of its Shares. The foregoing conditions are for the Company's sole benefit and may be asserted by the Company regardless of the circumstances giving rise to any such condition (including any action or inaction by the Company) or may be waived by the Company in whole or in part. The Company's failure at any time to exercise any of the foregoing rights shall not be deemed a waiver of any such right, and each such right shall be deemed an ongoing right that may be asserted at any time and from time to time. In certain circumstances, if the Company waives any of the foregoing conditions, it may be required to extend the Expiration Date of the Offer. Any determination by the Company concerning the events described above and any related judgment or decision by the Company regarding the inadvisability of proceeding with the purchase of or payment for any Shares tendered will be final and binding on all parties. 7. PRICE RANGE OF SHARES; DIVIDENDS The Shares are listed and principally traded on the NYSE. The high and low closing sales prices per Share on the NYSE Composite Tape as compiled from published financial sources and the quarterly cash dividends paid per Share for the periods indicated are listed below:
HIGH LOW DIVIDENDS ------- ------- --------- 1994 1st Quarter......................................... $16.25 $14.375 $ .05 2nd Quarter......................................... 14.75 13.00 .05 3rd Quarter......................................... 17.625 13.625 .05 4th Quarter......................................... 17.125 13.50 .05 1995 1st Quarter......................................... $16.50 $14.125 $ .06 2nd Quarter......................................... 16.50 14.875 .06 3rd Quarter......................................... 16.875 14.625 .06 4th Quarter......................................... 16.625 13.625 .06 1996 1st Quarter......................................... $17.625 $15.375 $ .06 2nd Quarter......................................... 18.75 16.00 .06 3rd Quarter......................................... 18.125 16.25 .06 4th Quarter (through October 21, 1996).............. 18.375 16.50 .06(1)
- --------------- (1) Dividend declared on October 24, 1996, payable on December 3, 1996, to holders of record of Shares on November 15, 1996, including holders of record tendering Shares in the Offer. 16 17 The closing per Share sales price as reported on the NYSE Composite Tape on October 21, 1996, the last full trading day before the announcement of the Offer, was $17.375. THE COMPANY URGES SHAREHOLDERS TO OBTAIN CURRENT QUOTATIONS OF THE MARKET PRICE OF THE SHARES. On January 26, 1989, the Board of Directors of the Company adopted a Shareholders' Rights Plan, which was amended as of April 25, 1996 and October 22, 1996 (as amended, the "Rights Plan"), pursuant to which common stock rights (the "Rights") were distributed to shareholders on the basis of one Right for each Share held. In general, the Rights become exercisable or transferable only upon the occurrence of certain events related to changes in ownership of the Shares. Once exercisable, each Right entitles its holder to purchase from the Company one Share at a purchase price of $58.00 per Share, subject to adjustment. Upon the occurrence of certain other events related to changes in the ownership of the Shares, each holder of a Right would be entitled to receive, upon exercise, (i) the number of Shares for which such Right was exercisable immediately prior to the event rendering the Rights exercisable at a price equal to 10% of the then current market price per Share, subject to adjustment, or (ii) shares of an acquiring corporation's common stock having a market value equal to two times the exercise price of the Right. The Rights expire on January 26, 1999 and, subject to certain conditions, may be redeemed by the Board of Directors at any time at a price of $.02 per Right. The Rights are not currently exercisable and trade together with the Shares associated therewith. On October 22, 1996, the Rights Plan was amended (the "October Amendment") to prevent the Rights from becoming exercisable due to the Offer. The October Amendment was necessary because the percentage ownership of an existing shareholder could be increased due to the repurchase of Shares by the Company in the Offer and trigger the exercisability of the Rights by passing certain shareholder ownership percentage thresholds (a shareholder passing such a threshold, a "Potentially Triggering Shareholder"). The October Amendment provides that so long as a Potentially Triggering Shareholder does not acquire beneficial ownership of additional Shares representing one-half of one percent or more of the outstanding Shares after the completion of the Offer, the exercisability of the Rights will not be triggered. As a result of the October Amendment, the Rights will not become exercisable or separately tradable due to the Offer. Absent circumstances causing the Rights to become exercisable or separately tradable prior to the Expiration Date, the tender of any Shares pursuant to the Offer will include the tender of the associated Rights. No separate consideration will be paid for such Rights. Upon the purchase of Shares by the Company pursuant to the Offer, the sellers of the Shares so purchased will no longer own the Rights associated with such Shares. At a meeting of the Board of Directors of the Company held on October 24, 1996, the Board of Directors declared a regular quarterly dividend of $.06 per Share payable on December 3, 1996 to shareholders of record on November 15, 1996. Since the Expiration Date will occur after November 15, 1996, holders of record on such date of Shares purchased in the Offer will be entitled to receive such dividend to be paid to shareholders of record as of such date regardless of whether such Shares are tendered pursuant to the Offer prior to, on or after November 15, 1996. 8. BACKGROUND AND PURPOSE OF THE OFFER; CERTAIN EFFECTS OF THE OFFER On August 20, 1996, the Company completed the sale of its United States precious metals refining division; in connection therewith, the Company retained ownership of the precious metals inventory previously necessary for the operation of the refining division. The Company intends to sell approximately 100,000 ounces of gold and approximately 4,430 ounces of platinum from its inventory to provide a portion of the financing necessary to consummate the Offer. The Company is making the Offer to (i) use the Company's cash and proceeds realized upon the sale of a portion of the Company's precious metals inventory to improve the Company's capital structure and lower its cost of capital for the benefit of its shareholders, and (ii) afford to those shareholders who desire liquidity an opportunity to sell all or a portion of their Shares without the usual transaction costs associated with open market sales. After the Offer is completed, the Company expects to have sufficient cash flow and access to other sources of capital to fund its growth initiatives, including building its businesses and making strategic acquisitions. 17 18 The Board of Directors believes that, given the Company's businesses, assets and prospects, the purchase of the Shares pursuant to the Offer is an attractive investment that will benefit the Company and its remaining shareholders. The Offer provides shareholders who are considering a sale of all or a portion of their Shares the opportunity to determine the price or prices (not greater than $20.00 nor less than $17.50 per Share) at which they are willing to sell their Shares and, if any such Shares are purchased pursuant to the Offer, to sell those Shares for cash to the Company without the usual costs associated with a market sale. The Offer gives shareholders an opportunity to sell their Shares at a price greater than the prevailing market prices of the Shares immediately prior to the announcement of the Offer. The Offer would also allow Odd Lot Owners whose Shares are purchased pursuant to the Offer to avoid both the payment of brokerage commissions and any applicable odd lot discounts payable on sales of odd lots on a securities exchange. To the extent the purchase of Shares in the Offer results in a reduction in the number of shareholders of record, the costs to the Company for services to shareholders should be reduced. Shareholders who determine not to accept the Offer will increase their proportionate interest in the Company's equity, and therefore in the Company's future earnings and assets, subject to the Company's right to issue additional Shares and other equity securities in the future. THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE MAKING OF THE OFFER. HOWEVER, SHAREHOLDERS MUST MAKE THEIR OWN DECISIONS WHETHER TO TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND THE PRICE OR PRICES AT WHICH SHARES SHOULD BE TENDERED. NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO ANY SHAREHOLDER AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING SHARES AND NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS HAS AUTHORIZED ANY PERSON TO MAKE ANY SUCH RECOMMENDATION. THE COMPANY HAS BEEN ADVISED THAT NONE OF ITS DIRECTORS OR EXECUTIVE OFFICERS INTENDS TO TENDER ANY SHARES PURSUANT TO THE OFFER. As of October 16, 1996, no person was known by the Company to be the beneficial owner of more than 5% of the outstanding Shares, except the Company understands from publicly available reports to the Commission that Mario J. Gabelli, Gabelli Funds, Inc., Gamco Investors, Inc., Gabelli & Company, Inc., Gabelli Performance Partnership, Gabelli International Limited and certain other affiliated entities (each at One Corporate Center, Rye, New York 10580-1434) (collectively, "Gabelli") may be deemed to be a group beneficially owning 2,708,200 outstanding Shares or approximately 19.6% (18.4% assuming the exercise of all outstanding Options) of the outstanding Shares; and Neuberger & Berman L.P., its affiliates and subsidiaries, at 605 Third Avenue, New York, New York 10158-3698 ("Neuberger & Berman") may be deemed to be a group beneficially owning 1,240,400 outstanding Shares or 9.0% (8.4% assuming the exercise of all outstanding Options) of the outstanding Shares. If the Company purchases 1,800,000 Shares pursuant to the Offer, assuming no Gabelli or Neuberger & Berman Shares are tendered in the Offer, Gabelli and Neuberger & Berman Shares would represent 22.6% and 10.3%, respectively, of the outstanding Shares (20.9% and 9.6%, respectively, assuming the exercise of all outstanding Options). Pursuant to the October Amendment to the Rights Plan, the above described increase in Share ownership by Gabelli as a result of the Offer will not cause the Rights to become exercisable. See Section 7. On November 6, 1995, the Company announced that the Board of Directors had authorized the repurchase of up to 1,500,000 of the then outstanding Shares (the "Repurchase Program"). The Shares were to be purchased from time to time in the open market or unsolicited negotiated transactions, including block purchases. The timing of the Repurchase Program and number of Shares repurchased was to be dictated by overall financial and market conditions. Since November 6, 1995, the Company has repurchased 429,600 Shares at prices ranging from $15.00 to $17.75 per Share pursuant to the Repurchase Program. Rule 13e-4 under the Exchange Act prohibits the Company from making any purchases of Shares until 10 business days after the Expiration Date, other than pursuant to the Offer; thereafter, the Company intends to resume the Repurchase Program. Any Share purchases under the Repurchase Program or otherwise may be on the same terms as, or on terms more or less favorable to shareholders than, the terms of the Offer. Any future purchases by the Company, either pursuant to the Repurchase Program or otherwise, will depend on numerous factors, 18 19 including the market price of the Shares, the results of the Offer, the Company's business and financial condition and general economic and market conditions. Shares purchased in the Offer will not be counted in the aggregate number of Shares to be purchased pursuant to the Repurchase Program. Shares the Company acquires pursuant to the Offer will be retained as treasury stock (unless and until the Company determines to retire such Shares) and be available for issue without further shareholder action (except as required by applicable law or, if retired, the rules of any securities exchange on which Shares are listed) for purposes including, but not limited to, the acquisition of other businesses, raising of additional capital for use in the Company's businesses, and satisfaction of obligations under existing or future employee benefit plans. The Company has no current plan for issuance of Shares repurchased pursuant to the Offer. Except as disclosed in this Offer to Purchase, the Company currently has no plans or proposals that relate to or would result in (a) the acquisition by any person of additional securities of the Company or the disposition of securities of the Company; (b) an extraordinary corporate transaction, such as a merger, reorganization or liquidation, involving the Company or any or all of its subsidiaries; (c) a sale or transfer of a material amount of assets of the Company or any of its subsidiaries; (d) any change in the present Board of Directors or management of the Company; (e) any material change in the present dividend rate or policy, or indebtedness or capitalization of the Company; (f) any other material change in the Company's corporate structure or business; (g) any change in the Company's Certificate of Incorporation or By-Laws or any actions which may impede the acquisition of control of the Company by any person; (h) a class of equity security of the Company being delisted from a national securities exchange; (i) a class of equity security of the Company becoming eligible for termination of registration pursuant to Section 12(g)(4) of the Exchange Act; or (j) the suspension of the Company's obligation to file reports pursuant to Section 15(d) of the Exchange Act. 9. INTERESTS OF DIRECTORS AND EXECUTIVE OFFICERS; TRANSACTIONS AND ARRANGEMENTS CONCERNING THE SHARES As of October 16, 1996, there were 13,806,427 Shares outstanding. On September 28, 1996, the compensation committee of the Board of Directors granted 140,000 Options to certain executive officers of the Company and there presently are 942,631 Shares issuable upon the exercise of all outstanding Options. As of October 16, 1996, the Company's directors and executive officers as a group (16 persons) beneficially owned 633,082 Shares (including 373,981 Shares issuable upon the exercise of Options exercisable within 60 days of such date), which constituted approximately 4.5% of the outstanding Shares (including Shares issuable if Options held by the Company's directors and executive officers exercisable within 60 days of such date were exercised) at such time. If the Company purchases 1,800,000 Shares pursuant to the Offer (approximately 13.0% of the outstanding Shares as of October 16, 1996) and no director or executive officer tenders Shares pursuant to the Offer (as is intended by the directors and executive officers), then after the purchase of Shares pursuant to the Offer, the Company's directors and executive officers as a group would beneficially own approximately 5.1% of the outstanding Shares (including Shares issuable if Options held by the Company's directors and executive officers exercisable within 60 days of such date were exercised). As of October 16, 1996, no director or executive officer had beneficial ownership of more than 1% of the outstanding Shares, except Richard N. Daniel, Chairman of the Board and Chief Executive Officer of the Company, and Frank E. Grzelecki, President and Chief Operating Officer of the Company, whose beneficial ownership was approximately 1.6% and 1.1%, respectively, of the outstanding Shares (including Shares issuable if Options held by the Company's directors and executive officers exercisable within sixty days of such date were exercised). If the Company purchases 1,800,000 Shares pursuant to the Offer, assuming no Shares beneficially owned by Mr. Daniel or Mr. Grzelecki are tendered in the Offer (as is intended by Messrs. Daniel and Grzelecki), Shares beneficially owned by Mr. Daniel and Mr. Grzelecki would represent approximately 1.8% and 1.2%, respectively, of the outstanding Shares (including Shares issuable if Options held by the Company's directors and executive officers exercisable within 60 days of such date were exercised). Except as set forth in Section 8 hereof or in Schedule I hereto, based on the Company's records and information provided to the Company by its directors, executive officers, associates and subsidiaries, neither the Company nor any of its associates or subsidiaries or persons controlling the Company nor, to the best of the Company's knowledge, any of the directors or executive officers of the Company or any of its subsidiaries, 19 20 nor any associates or subsidiaries of any of the foregoing, has effected any transactions in the Shares during the 40 business days prior to the date hereof. Except as set forth in this Offer to Purchase, neither the Company or any person controlling the Company nor, to the Company's knowledge, any of its directors or executive officers, is a party to any contract, arrangement, understanding or relationship with any other person relating, directly or indirectly, to the Offer with respect to any securities of the Company (including, but not limited to, any contract, arrangement, understanding or relationship concerning the transfer or the voting of any such securities, joint ventures, loan or option arrangements, puts or calls, guarantees of loans, guarantees against loss or the giving or withholding of proxies, consents or authorizations). 10. SOURCE AND AMOUNT OF FUNDS Assuming that the Company purchases 1,800,000 Shares pursuant to the Offer at the maximum specified purchase price of $20.00 per Share, the Company expects the maximum aggregate cost, including all fees and expenses applicable to the Offer, to be approximately $36,500,000. The Company anticipates that substantially all of the funds necessary to pay such amounts will be provided by the Company's cash, proceeds of the sale of precious metals and the existing credit facilities of the Company. On August 20, 1996, the Company completed the sale of its United States precious metals refining division; in connection therewith, the Company retained ownership of the precious metals inventory previously necessary for the operation of the refining division. The Company intends to sell approximately 100,000 ounces of gold and approximately 4,430 ounces of platinum from its inventory to provide a portion of the financing necessary to consummate the Offer. The Company intends to obtain an additional portion of the financing for the Offer through unsecured borrowings under its Revolving Credit Agreement, dated as of September 28, 1994, as amended (the "Credit Agreement"), among the Company and certain financial institutions, as lenders. Under the Credit Agreement, the Bank of Nova Scotia ("Scotiabank"), Chemical Bank and Bank of New York act as co-agents and Scotiabank acts as administrative agent. Pursuant to the Credit Agreement, the Company has a $200 million revolving credit facility (the "Credit Facility"), subject to reduction in certain circumstances. Loans made under the Credit Facility bear interest, at the Company's option, (a) at a rate equal to the sum of the applicable margin and the (i) London inter-bank offered rate ("LIBOR") or (ii) an Alternate Base Rate equal to the greater of (x) Scotiabank's base rate for loans in U.S. dollars in the United States, and (y) the sum of the federal funds rate and 50 basis points, or (b) at a rate determined by a competitive bid system among the financial institutions party to the Credit Agreement. The applicable margin varies based on certain financial ratios relating to the Company's financial condition. The final maturity date of any loan under the Credit Facility is September 27, 1999, unless extended pursuant to the terms of the Credit Agreement. The Credit Agreement includes representations and warranties, covenants, events of default and other terms customary to financing of this type. A copy of the Credit Agreement has been filed with the Commission as an exhibit to the Company's Current Report on Form 8-K dated October 12, 1994 and is incorporated by reference herein. On June 30, 1995, September 24, 1996 and October 11, 1996, the Credit Agreement was amended (the "Amendments"); copies of the Amendments were filed as exhibits to the Issuer Tender Offer Statement on Schedule 13E-4 filed by the Company on the date hereof and which Amendments are incorporated by reference herein. The Company expects to repay indebtedness incurred under the Credit Facility as a result of the Offer through cash flow from operations and/or future borrowings. 11. CERTAIN INFORMATION ABOUT THE COMPANY The Company was incorporated in the State of New York in 1905 as the successor to a partnership which commenced business in 1867. Until commencing a diversification program in 1966, the Company was engaged primarily in the manufacture of silver and gold alloys in mill forms and the refining of precious metals from jewelry and industrial scrap. The Company's markets were largely among silversmiths and manufacturing jewelers, users of silver brazing alloys, and manufacturers who required silver and gold primarily for the 20 21 properties of those metals. As part of these precious metals operations, the Company continues to publish a daily New York price for its purchases of silver and gold and also publishes a daily price for its fabricated silver and gold. The silver price is relied on and used by manufacturers, banks, traders and others throughout the world. The diversification program added lines of precious metals products and various specialty manufacturing operations, including stainless steel and specialty metal alloy products, for industrial users in a wide range of applications in the electrical, electronic, automotive original equipment, office equipment, oil and other energy-related, refrigeration, utility, telecommunications and medical industries. In September 1994, the Company acquired Sumco Inc., a precision electroplating firm, which electroplates electronic connector and connector stock for the automotive, telecommunications, electronic and computer industries. The Company's business segments are manufacturing and selling (a) non-precious metal wire, cable and tubing products composed primarily of stainless steel and specialty alloys; (b) precious metal precision plating and surface finishing and other precious metal manufactured products; and (c) other specialty products supplied to natural gas, electrical and water utility companies. Historical Financial Information. The following table sets forth summary historical consolidated financial information of the Company and its subsidiaries. The historical financial information for fiscal years 1994 and 1995 (other than the ratios of earnings to fixed charges) has been derived from, and should be read in conjunction with, the audited consolidated financial statements of the Company as reported in the Company's Annual Reports on Form 10-K for the fiscal years ended December 31, 1995 and December 31, 1994 and is hereby incorporated herein by reference. In addition, the historical financial information for that portion of fiscal year 1996 presented is unaudited. Such historical financial information for fiscal year 1996 was set forth in the Company's Quarterly Report on Form 10-Q for the quarter and six months ended June 30, 1996 and is hereby incorporated herein by reference. The summary historical financial information should be read in conjunction with, and is qualified in its entirety by reference to, the audited financial statements and the related notes thereto from which it has been derived. Copies of reports may be inspected or obtained from the Commission in the manner specified in "-- Additional Information" below. 21 22 SUMMARY HISTORICAL CONSOLIDATED FINANCIAL INFORMATION(1) (IN THOUSANDS, EXCEPT RATIOS AND PER SHARE AMOUNTS)
YEAR ENDED SIX MONTHS ENDED ----------------------------- --------------------- DECEMBER 31, DECEMBER 31, JUNE 30, JUNE 30, 1994 1995 1995 1996 ------------ ------------ -------- -------- (UNAUDITED) STATEMENT OF INCOME DATA Revenue................................... $408,968 $427,188 $228,090 $214,146 Income from continuing operations before taxes........................... 11,567 14,286 6,096 15,503 Income from continuing operations......... 6,743 7,509 2,816 8,817 Gain (loss) from discontinued operations............................. 9,768 11,131 1,251 (9,654) Net income (loss)......................... 16,511 18,640 4,067 (837) Earnings per common share: Income from continuing operations...... $ 0.48 $ 0.53 $ 0.20 $ 0.63 Gain (loss) from discontinued operations........................... 0.70 0.79 0.09 (0.69) Net income (loss)...................... $ 1.18 $ 1.32 $ 0.29 $ (0.06) Average shares outstanding................ 14,050 14,092 14,095 14,027 Ratio of earnings to fixed charges(2)..... 2.07 2.13 1.90 4.70
AT AT ----------------------------- --------------------- DECEMBER 31, DECEMBER 31, JUNE 30, JUNE 30, 1994 1995 1995 1996 ------------ ------------ -------- -------- (UNAUDITED) BALANCE SHEET DATA Working capital........................... $ 33,743 $ 49,480 $ 37,218 $ 32,747 Total assets.............................. 405,018 341,049 421,365 325,935 Total assets less excess of purchase price over net assets acquired in business combinations........................... 382,731 319,363 399,327 301,299 Total long-term debt(3)................... 131,750 93,500 112,000 83,500 Shareholders' equity...................... 106,124 120,394 108,164 116,707 Book value per common share............... $ 7.54 $ 8.59 $ 7.67 $ 8.31
- --------------- NOTES TO SUMMARY HISTORICAL CONSOLIDATED FINANCIAL INFORMATION (1) Revenue and expenses for the periods presented have been restated to reflect the sale of the Company's Refining Division business accounted for as a discontinued operation. (2) The ratio of earnings to fixed charges has been computed by dividing the sum of income from continuing operations before taxes and interest expense from continuing operations by interest expense from continuing operations. (3) Subsequent Event: On October 10, 1996, the Company repaid $64,500,000 of its long-term indebtedness with proceeds from its existing credit facilities; in connection therewith, the Company was required to pay a make-whole payment of $4,477,962. Pro Forma Financial Information. The following summary unaudited consolidated pro forma financial information gives effect to the purchase of Shares pursuant to the Offer, based on certain assumptions described in the Notes to Summary Unaudited Consolidated Pro Forma Financial Information and gives effect to the purchase of Shares pursuant to the Offer as if it had occurred on January 1, 1995. The pro forma financial information should be read in conjunction with the historical consolidated financial information incorporated herein by reference and does not purport to be indicative of the results that would actually have 22 23 been obtained had the purchase of the Shares pursuant to the Offer been completed at the dates indicated or that may be obtained in the future. SUMMARY UNAUDITED CONSOLIDATED PRO FORMA FINANCIAL INFORMATION (IN THOUSANDS, EXCEPT RATIOS AND PER SHARE AMOUNTS)
SIX MONTHS ENDED YEAR ENDED DECEMBER 31, 1995 JUNE 30, 1996 --------------------------------- --------------------------------- PRO FORMA PRO FORMA -------------------- -------------------- AT $20 AT $17.50 AT $20 AT $17.50 PURCHASE PURCHASE PURCHASE PURCHASE HISTORICAL PRICE PRICE HISTORICAL PRICE PRICE ---------- -------- --------- ---------- -------- --------- STATEMENT OF INCOME DATA Revenue............................................. $427,188 $427,188 $427,188 $214,146 $214,146 $214,146 Income from continuing operations before taxes...... 14,286 49,537 49,811 15,503 15,153 15,290 Income from continuing operations................... 7,509 28,307 28,469 8,817 8,622 8,700 Gain (loss) from discontinued operations............ 11,131 11,131 11,131 (9,654) (9,654) (9,654 ) Net income (loss)................................... 18,640 39,438 39,600 (837) (1,032) (954 ) Earnings per common share: Income from continuing operations................. $ 0.53 $ 2.30 $ 2.32 $ 0.63 $ 0.71 $ 0.71 Gain (loss) from discontinued operations.......... 0.79 0.90 0.90 (0.69) (0.79) (0.79 ) Net income (loss)................................. $ 1.32 $ 3.20 $ 3.22 $ (0.06) $ (0.08) $ (0.08 ) Average shares outstanding.......................... 14,092 12,292 12,292 14,027 12,227 12,227 Ratio of earnings to fixed charges.................. 2.13 4.72 4.82 4.70 4.34 4.48
AT DECEMBER 31, 1995 AT JUNE 30, 1996 --------------------------------- --------------------------------- PRO FORMA PRO FORMA -------------------- -------------------- AT $20 AT $17.50 AT $20 AT $17.50 PURCHASE PURCHASE PURCHASE PURCHASE HISTORICAL PRICE PRICE HISTORICAL PRICE PRICE ---------- -------- --------- ---------- -------- --------- BALANCE SHEET DATA Working capital..................................... $ 49,480 $ 45,277 $ 45,439 $ 32,747 $ 28,457 $ 28,697 Total assets........................................ 341,049 336,846 337,008 325,935 321,537 321,777 Total assets less excess of purchase price over net assets acquired in business combinations.......... 319,363 315,160 315,322 301,299 296,901 297,141 Total long-term debt................................ 93,500 104,567 100,067 83,500 94,351 89,851 Shareholders' equity................................ 120,394 105,124 109,786 116,707 104,071 108,811 Book value per common share......................... $ 8.59 $ 8.61 $ 8.99 $ 8.31 $ 8.50 $ 8.89
- --------------- NOTES TO SUMMARY UNAUDITED CONSOLIDATED PRO FORMA FINANCIAL INFORMATION The following assumptions regarding the Offer were made in arriving at the pro forma financial information: (1) Revenue and expenses for the periods presented have been restated to reflect the sale of the Company's Refining Division business accounted for as a discontinued operation. (2) The information assumes 1,800,000 Shares are repurchased and retired at a $20 per Share price and at a $17.50 per Share price, respectively. A portion of the repurchase was assumed to be financed from cash generated from the sale of 100,000 ounces of gold at $380.00 per ounce and 4,430 ounces of platinum at $393.00 per ounce. The sale of these LIFO metals will result in an after tax gain of $21,212,000 and cash flow of approximately $25,000,000. The remainder of the repurchase was assumed to be financed through long-term debt. It was assumed that these transactions took place on January 1, 1995. (3) Income before taxes was increased in 1995 by $35,952,000 for LIFO profits from the sale of the precious metals described above. Interest expense was increased for the periods presented for the additional long-term debt assumed to be used to finance the repurchase of Shares as of January 1, 1995. The assumed interest rate on the additional borrowings was 6.1%. 23 24 (4) Income taxes on LIFO profits and increased interest were computed at an assumed marginal rate of 41% for 1995 and on increased interest for 1996 at 43.1%. (5) Expenses directly related to the Offer are assumed to be $500,000 and are charged against shareholders' equity. (6) The ratio of earnings to fixed charges has been computed by dividing the sum of income from continuing operations before taxes and interest expense from continuing operations by interest expense from continuing operations. Additional Information. The Company is subject to the informational filing requirements of the Exchange Act and, in accordance therewith, is obligated to file reports and other information with the Commission relating to its business, financial condition and other matters. Information, as of particular dates, concerning the Company's directors and officers, their remuneration, options granted to them, the principal holders of the Company's securities and any material interest of such persons in transactions with the Company is required to be disclosed in proxy statements distributed to the Company's shareholders and filed with the Commission. Such reports, proxy statements and other information can be inspected and copied at the public reference facilities maintained by the Commission at 450 Fifth Street, N.W., Room 2120, Washington, D.C. 20549; at its regional offices located at 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511; and 7 World Trade Center, New York, New York 10048. Copies of such material may also be obtained by mail, upon payment of the Commission's customary charges, from the Public Reference Section of the Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington D.C. 20549. The Commission also maintains a Web site on the World Wide Web at http://www.sec.gov that contains reports, proxy and information statements and other information regarding registrants that file electronically with the Commission. Such reports, proxy statements and other information concerning the Company also can be inspected at the offices of the NYSE, 20 Broad Street, New York, New York 10005, on which the Shares are listed. 12. EFFECTS OF THE OFFER ON THE MARKET FOR SHARES; REGISTRATION UNDER THE EXCHANGE ACT The Company's purchase of Shares pursuant to the Offer will reduce the number of Shares that might otherwise trade publicly and is likely to reduce the number of shareholders. Nonetheless, the Company believes that there will still be a sufficient number of Shares outstanding and publicly traded following the Offer to ensure a continued trading market in the Shares. Based on the published guidelines of the NYSE, the Company does not believe that its purchase of Shares pursuant to the Offer will cause its remaining Shares to be delisted from such exchange. The Shares are currently "margin securities" under the rules of the Federal Reserve Board. This has the effect, among other things, of allowing brokers to extend credit on the collateral of the Shares. The Company believes that, following the purchase of Shares pursuant to the Offer, the Shares will continue to be "margin securities" for purposes of the Federal Reserve Board's margin regulations. The Shares are registered under the Exchange Act, which requires, among other things, that the Company furnish certain information to its shareholders and to the Commission and comply with the Commission's proxy rules in connection with meetings of the Company's shareholders. The Company believes that its purchase of Shares pursuant to the Offer will not result in the Shares becoming eligible for deregistration under the Exchange Act. 13. CERTAIN LEGAL MATTERS; REGULATORY APPROVALS The Company is not aware of any license or regulatory permit material to its business that might be adversely affected by its acquisition of Shares as contemplated in the Offer or of any approval or other action by any government or governmental, administrative or regulatory authority or agency, domestic or foreign, that would be required for the Company's acquisition or ownership of Shares as contemplated by the Offer. Should any such approval or other action be required, the Company currently contemplates that it will seek such approval or other action. The Company cannot predict whether it may determine that it is required to delay the acceptance for payment of, or payment for, Shares tendered pursuant to the Offer pending the outcome of any such matter. There can be no assurance that any such approval or other action, if needed, would be obtained or would be obtained without substantial conditions or that the failure to obtain any such approval or 24 25 other action might not result in adverse consequences to the Company's business. The Company's obligations under the Offer to accept for payment and pay for Shares are subject to certain conditions. See Section 6. The consent of certain banks under credit agreements with the Company was required to permit the making of the Offer; such consents were obtained prior to the date hereof. 14. CERTAIN U.S. FEDERAL INCOME TAX CONSEQUENCES The following summary describes certain United States federal income tax consequences relevant to the Offer. The discussion contained in this summary is based upon the Internal Revenue Code of 1986, as amended to the date hereof (the "Code"), existing and proposed Treasury regulations promulgated thereunder, rulings, administrative pronouncements and judicial decisions, changes to which could materially affect the tax consequences described herein and could be made on a retroactive basis. This summary discusses only Shares held as capital assets, within the meaning of Section 1221 of the Code, and does not address all of the tax consequences that may be relevant to particular shareholders in light of their personal circumstances, or to certain types of shareholders (such as certain financial institutions, dealers in securities or commodities, insurance companies, tax-exempt organizations or persons who hold Shares as a position in a "straddle" or as a part of a "hedging" or "conversion" transaction for United States federal income tax purposes). In particular, the discussion of the consequences of an exchange of Shares for cash pursuant to the Offer applies only to a United States Holder. For purposes of this summary, a "United States Holder" is a holder of Shares that is (a) a citizen or resident of the United States, (b) a corporation, partnership or other entity created or organized in or under the laws of the United States, any state or any political subdivision thereof, or (c) an estate or trust the income of which is subject to United States federal income taxation regardless of its source. This discussion does not address the tax consequences to foreign shareholders who will be subject to United States federal income tax on a net basis on the proceeds of their exchange of Shares pursuant to the Offer because such income is effectively connected with the conduct of a trade or business within the United States. Such shareholders are generally taxed in a manner similar to United States Holders; however, certain special rules apply. Foreign shareholders who are not subject to United States federal income tax on a net basis should see Section 3 for a discussion of the applicable United States withholding rules and the potential for obtaining a refund of all or a portion of the tax withheld. The summary may not be applicable with respect to Shares acquired as compensation (including Shares acquired upon the exercise of options or which were or are subject to forfeiture restrictions). The summary also does not address the state, local or foreign tax consequences of participating in the Offer. EACH SHAREHOLDER SHOULD CONSULT SUCH SHAREHOLDER'S TAX ADVISOR AS TO THE PARTICULAR CONSEQUENCES OF PARTICIPATION IN THE OFFER. United States Holders Who Receive Cash Pursuant to the Offer. An exchange of Shares for cash pursuant to the Offer by a United States Holder will be a taxable transaction for United States federal income tax purposes. As a consequence of the exchange, a United States Holder will, depending on such holder's particular circumstances, be treated either as having sold such holder's Shares or as having received a dividend distribution from the Company, with the tax consequences described below. Under Section 302 of the Code, a United States Holder whose Shares are exchanged for cash pursuant to the Exchange will be treated as having sold such holder's Shares, and thus will recognize gain or loss if the exchange (a) results in a "complete termination" of such holder's equity interest in the Company, (b) is "substantially disproportionate" with respect to such holder or (c) is "not essentially equivalent to a dividend" with respect to the holder, each as discussed below. In applying these tests, a United States Holder will be treated as owing Shares actually or constructively owned by certain related individuals and entities. If a United States Holder sells Shares to persons other than the Company at or about the time such holder also sells Shares to the Company pursuant to the Offer, and the various sales effected by the holder are part of an overall plan to reduce or terminate such holder's proportionate interest in the Company, then the sales to persons other than the Company may, for United States federal income tax purposes, be integrated with the holder's sale of Shares pursuant to the Offer and, if integrated, should be taken into account in determining whether the holder satisfies any of the three tests described below. 25 26 A United States Holder that exchanges all Shares actually or constructively owned by such holder for cash pursuant to the Offer will be treated as having completely terminated such holder's equity interest in the Company. An exchange of Shares for cash will be "substantially disproportionate" with respect to a United States Holder if the percentage of the then outstanding Shares actually and constructively owned by such holder immediately after the exchange is less than 80% of the percentage of the Shares actually and constructively owned by such holder immediately before the exchange. A United States Holder will satisfy the "not essentially equivalent to a dividend" test if the reduction in such holder's proportionate interest in the Company constitutes a "meaningful reduction" given such holder's particular facts and circumstances. The IRS has indicated in published rulings that any reduction in the percentage interest of a shareholder whose relative stock interest in a publicly held corporation is minimal (an interest of less than 1% should satisfy this requirement) and who exercises no control over corporate affairs should constitute such a "meaningful reduction." If a United States Holder is treated as having sold such holder's Shares under the tests described above, such holder will recognize gain or loss equal to the difference between the amount of cash received and such holder's tax basis in the Shares exchanged therefor. Any such gain or loss will be capital gain or loss and will be long-term capital gain or loss if the holding period of the Shares exceeds one year as of the date of the exchange. If a United States Holder who exchanges Shares pursuant to the Offer is not treated under Section 302 as having sold such holder's Shares for cash, the entire amount of cash received by such holder will be treated as a dividend to the extent of the Company's current and accumulated earnings and profits, which the Company anticipates will be sufficient to cover the amount of any such dividend and will be includible in the holder's gross income as ordinary income in its entirety, without reduction for the tax basis of the Shares exchanged. No loss will be recognized. The United States Holder's tax basis in the Shares exchanged generally will be added to such holder's tax basis in such holder's remaining Shares. To the extent that cash received in exchange for Shares is treated as a dividend to a corporate United States Holder, such holder will be (i) eligible for a dividends-received deduction (subject to applicable limitations) and (ii) subject to the "extraordinary dividend" provisions of the Code. To the extent, if any, that the cash received by a United States Holder exceeds the Company's current and accumulated earnings and profits, it will be treated first as a tax-free return of such holder's tax basis in the Shares and thereafter as capital gain. The Company cannot predict whether or to what extent the Offer will be oversubscribed. If the Offer is oversubscribed, proration of tenders pursuant to the Offer will cause the Company to accept fewer Shares than are tendered. Therefore, a holder can be given no assurance that a sufficient number of such holder's Shares will be exchanged pursuant to the Offer to ensure that such exchange will be treated as a sale, rather than as a dividend, for United States federal income tax purposes pursuant to the rules discussed above. Shareholders Who Do Not Receive Cash Pursuant to the Offer. Shareholders whose Shares are not exchanged pursuant to the Offer will not incur any tax liability as a result of the consummation of the Offer. Participants in the Savings Plan may have additional tax considerations. See the Direction Form and related materials sent under separate cover to such participants. See Section 3 with respect to the application of United States federal income tax withholding to payments made to foreign shareholders and backup withholding. THE TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL INFORMATION ONLY. EACH SHAREHOLDER IS URGED TO CONSULT SUCH HOLDER'S OWN TAX ADVISOR TO DETERMINE THE PARTICULAR TAX CONSEQUENCES TO HIM OR HER OF THE OFFER, INCLUDING THE APPLICABILITY AND EFFECT OF STATE, LOCAL AND FOREIGN TAX LAWS. 26 27 15. EXTENSION OF THE OFFER; TERMINATION; AMENDMENTS The Company expressly reserves the right, in its sole discretion, at any time and from time to time, and regardless of whether or not any of the events set forth in Section 6 shall have occurred or shall be deemed by the Company to have occurred, to extend the period of time during which the Offer is open and thereby delay acceptance for payment of, and payment for, any Shares by giving oral or written notice of such extension to the Depositary and making a public announcement thereof. The Company also expressly reserves the right, in its sole discretion, to terminate the Offer and not accept for payment or pay for any Shares not theretofore accepted for payment or paid for or, subject to applicable law, to postpone payment for Shares upon the occurrence of any of the conditions specified in Section 6 hereof by giving oral or written notice of such termination or postponement to the Depositary and making a public announcement thereof. Additionally, in certain circumstances, if the Company waives any of the conditions of the Offer set forth in Section 6, it may be required to extend the Expiration Date of the Offer. The Company's reservation of the right to delay payment for Shares that it has accepted for payment is limited by Rule 13e-4(f)(5) promulgated under the Exchange Act, which requires that the Company must pay the consideration offered or return the Shares tendered promptly after termination or withdrawal of a tender offer. Subject to compliance with applicable law, the Company further reserves the right, in its sole discretion, and regardless of whether any of the events set forth in Section 6 shall have occurred or shall be deemed by the Company to have occurred, to amend the Offer in any respect (including, without limitation, by decreasing or increasing the consideration offered in the Offer to holders of Shares or by decreasing or increasing the number of Shares being sought in the Offer). Amendments to the Offer may be made at any time and from time to time effected by public announcement thereof, such announcement, in the case of an extension, to be issued no later than 9:00 A.M., New York City time, on the next business day after the last previously scheduled or announced Expiration Date. Any public announcement made pursuant to the Offer will be disseminated promptly to shareholders in a manner reasonably designated to inform shareholders of such change. Without limiting the manner in which the Company may choose to make any public announcement, except as provided by applicable law (including Rule 13e-4(e)(2) promulgated under the Exchange Act), the Company shall have no obligation to publish, advertise or otherwise communicate any such public announcement other than by making a release to the Dow Jones News Service. If the Company makes a material change in the terms of the Offer or the information concerning the Offer, or if it waives a material condition of the Offer, the Company will extend the Offer to the extent required by Rules 13e4(d)(2) and 13e-4(e)(2) promulgated under the Exchange Act, which require that the minimum period during which an offer must remain open following material changes in the terms of the offer or information concerning the offer (other than a change in price or a change in percentage of securities sought) will depend upon the facts and circumstances, including the relative materiality of such terms or information. If (i) the Company increases or decreases the price to be paid for Shares, the Company increases or decreases the Dealer Manager's fee, the Company increases the number of Shares being sought and such increase in the number of Shares being sought exceeds 2% of the outstanding Shares, or the Company decreases the number of Shares being sought, and (ii) the Offer is scheduled to expire at any time earlier than the expiration of a period ending on the tenth business day from, and including, the date that notice of such increase or decrease is first published, sent or given, the Offer will be extended until the expiration of such period of ten business days. 16. FEES AND EXPENSES The Company has retained J.P. Morgan Securities Inc. ("J.P. Morgan") to act as the Dealer Manager in connection with the Offer. J.P. Morgan will receive a fee of $175,000 for its services as Dealer Manager and an advisory fee of $100,000. The Company also has agreed to reimburse J.P. Morgan for certain expenses incurred in connection with the Offer, including out-of-pocket expenses and reasonable attorney's fees and disbursements, and to indemnify J.P. Morgan against certain liabilities in connection with the Offer, including certain liabilities under the federal securities laws. J.P. Morgan has rendered various investment banking and other advisory services to the Company in the past, for which it has received customary compensation, and can be expected to render similar services to the Company in the future. The Company also has retained 27 28 Georgeson & Company Inc. as Information Agent and ChaseMellon Shareholder Services, L.L.C. as Depositary in connection with the Offer. The Information Agent and the Depositary will receive reasonable and customary compensation for their services. The Company will also reimburse the Information Agent and the Depositary for out-of-pocket expenses, including reasonable attorneys' fees, and has agreed to indemnify the Information Agent and the Depositary against certain liabilities in connection with the Offer, including certain liabilities under the federal securities laws. The Dealer Manager and Information Agent may contact shareholders by mail, telephone, telex, telegraph and personal interviews, and may request brokers, dealers and other nominee shareholders to forward materials relating to the Offer to beneficial owners. Neither the Information Agent nor the Depositary has been retained to make solicitations or recommendations in connection with the Offer. The Company will not pay fees or commissions to any broker, dealer, commercial bank, trust company or other person (other than the Dealer Manager) for soliciting any Shares pursuant to the Offer. The Company will, however, on request, reimburse such persons for customary handling and mailing expenses incurred in forwarding materials in respect of the Offer to the beneficial owners for which they act as nominees. No such broker, dealer, commercial bank or trust company has been authorized to act as the Company's agent for purposes of the Offer. The Company will pay (or cause to be paid) any stock transfer taxes on its purchase of Shares, except as otherwise provided in Instruction 7 of the Letter of Transmittal. 17. MISCELLANEOUS The Company is not aware of any jurisdiction where the making of the Offer is not in compliance with applicable law. If the Company becomes aware of any jurisdiction where the making of the Offer is not in compliance with any valid applicable law, the Company will make a good faith effort to comply with such law. If, after such good faith effort, the Company cannot comply with such law, the Offer will not be made to (nor will tenders be accepted from or on behalf of) the holders of Shares residing in such jurisdiction. In any jurisdiction the securities or blue sky laws of which require the Offer to be made by a licensed broker or dealer, the Offer is being made on the Company's behalf by the Dealer Manager or one or more registered brokers or dealers licensed under the laws of such jurisdiction. Pursuant to Rule 13e-4 promulgated under the Exchange Act, the Company has filed with the Commission an Issuer Tender Offer Statement on Schedule 13E-4 (the "Schedule 13E-4") which contains additional information with respect to the Offer. The Schedule 13E-4, including the exhibits and any amendments thereto, may be examined, and copies may be obtained, at the same places and in the same manner as is set forth in Section 11 with respect to information concerning the Company. NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY REPRESENTATION ON BEHALF OF THE COMPANY OR THE DEALER MANAGER IN CONNECTION WITH THE OFFER OTHER THAN THOSE CONTAINED IN THIS OFFER TO PURCHASE OR IN THE RELATED LETTER OF TRANSMITTAL. IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR THE DEALER MANAGER. HANDY & HARMAN October 24, 1996 28 29 SCHEDULE I CERTAIN TRANSACTIONS INVOLVING SHARES Except as set forth below, based upon the Company's records and upon information provided to the Company by its directors, executive officers, associates and subsidiaries, neither the Company nor any of its associates or subsidiaries or persons controlling the Company (of which the Company believes there are none) nor, to the best of the Company's knowledge, any of the directors or executive officers of the Company or any of its subsidiaries, nor any associates or subsidiary of any of the foregoing, has effected any transactions in the Shares during the 40 business days prior to October 24, 1996. 1. The Company has repurchased an aggregate of 26,600 Shares at prices ranging from $17.25 to $17.75 pursuant to its ongoing Share Repurchase Program, each in market purchases on the NYSE, as set forth in the table below:
NUMBER OF DATE SHARES PRICE(1) ------------------------------------------------------ --------- ------ 9/3/96................................................ 25,000 $17.25 9/24/96............................................... 800 $17.75 9/25/96............................................... 600 $17.75 9/26/96............................................... 200 $17.75
- --------------- (1) Exclusive of brokerage commission. 2. The Company issued Options to purchase an aggregate of 140,000 Shares to the Company's executive officers on September 26, 1996 under the Company's 1995 Omnibus Stock Incentive Plan, as set forth in the table below:
NUMBER OF NAME OPTIONS GRANTED EXERCISE PRICE -------------------------------------------------- --------------- -------------- R.N. Daniel....................................... 50,000 $17.75 F.E. Grzelecki.................................... 40,000 $17.75 R.F. Burlinson.................................... 15,000 $17.75 P.E. Dixon........................................ 15,000 $17.75 J.M. McLoone...................................... 5,000 $17.75 S.B. Mudd......................................... 5,000 $17.75 D.C. Kelly........................................ 10,000 $17.75
3. Paul E. Dixon, Vice President, General Counsel and Secretary of the Company, exercised options to purchase 2,000 Shares at a price of $12.937 per Share on September 23, 1996, and sold such acquired Shares at a price of $17.75 on such date. 4. Robert E. Cornelia, a director of the Company, exercised options to purchase 699 Shares at a price of $1.00 per Share on September 26, 1996. S-1 30 Manually signed facsimile copies of the Letter of Transmittal will be accepted. The Letter of Transmittal and certificates for the Shares and any other required documents should be sent or delivered by each shareholder or such shareholder's broker, dealer, commercial bank, trust company or other nominee to the Depositary at its address set forth below: The Depositary for the Offer is: CHASEMELLON SHAREHOLDER SERVICES, L.L.C. By Mail: By Facsimile Transmission: By Hand or By Overnight Courier: Reorganization Department (201) 329-8936 Reorganization Department Midtown Station 120 Broadway - 13th Floor P.O. Box 798 New York, New York 10271 New York, New York 10018
Confirm Receipt of Notice of Guaranteed Delivery: (201) 296-4983 Any questions or requests for assistance or for additional copies of this Offer to Purchase, the Letter of Transmittal or the Notice of Guaranteed Delivery may be directed to the Information Agent, at the telephone number and address below. Shareholders may also contact their broker, dealer, commercial bank or trust company for assistance concerning the Offer. The Information Agent for the Offer is: GEORGESON & COMPANY INC. Wall Street Plaza New York, New York 10005 Toll Free: (800) 223-2064 Bank & Brokers Call Collect: (212) 440-9800 The Dealer Manager for the Offer is: J.P. MORGAN SECURITIES INC. 60 Wall Street New York, New York 10260-0060 Toll Free: (800) 576-9843 (212) 648-7833 EX-99.A2 3 LETTER OF TRANSMITTAL 1 LETTER OF TRANSMITTAL TO TENDER SHARES OF COMMON STOCK (INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS) OF HANDY & HARMAN PURSUANT TO THE OFFER TO PURCHASE DATED OCTOBER 24, 1996 THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY, NOVEMBER 21, 1996, UNLESS THE OFFER IS EXTENDED. THE DEPOSITARY FOR THE OFFER IS: CHASEMELLON SHAREHOLDER SERVICES, L.L.C. By Mail: By Facsimile Transmission: By Hand or Overnight Courier: Reorganization Department (201) 329-8936 Reorganization Department Midtown Station Confirm Receipt of Notice of 120 Broadway - 13th Floor P.O. Box 798 Guaranteed Delivery: New York, NY 10271 New York, NY 10018 (201) 296-4983
- -------------------------------------------------------------------------------- DESCRIPTION OF SHARES TENDERED (SEE INSTRUCTIONS 3 AND 4) - ------------------------------------------------------------------------------------------------------------------------------ NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S) (PLEASE FILL IN EXACTLY AS NAME(S) SHARES TENDERED APPEAR(S) ON CERTIFICATE(S)) (ATTACH ADDITIONAL SIGNED LIST IF NECESSARY) ------------------------------------------------------------------------------------------------------------------------------ TOTAL NUMBER OF SHARES NUMBER CERTIFICATE REPRESENTED BY OF SHARES NUMBER(s)(1) CERTIFICATE(s) TENDERED(2) -------------- -------------- -------------- -------------- TOTAL SHARES: ------------------------------------------------------------------------------------------------------------------------------
Indicate in this box the order (by certificate number) in which Shares are to be purchased in the event of proration.(3) (Attach additional signed list if necessary.) See Instruction 15. 1st: 2nd: 3rd: 4th: 5th: - -------------------------------------------------------------------------------- (1) Need not be completed by shareholders tendering Shares by book-entry transfer. (2) Unless otherwise indicated, it will be assumed that all Shares represented by each Share certificate delivered to the Depositary are being tendered hereby. See Instruction 4. (3) If you do not designate an order, then in the event less than all Shares tendered are purchased due to proration, Shares will be selected for purchase by the Depositary. See Instruction 15. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- NOTE: SIGNATURES MUST BE PROVIDED BELOW. PLEASE READ THE INSTRUCTIONS SET FORTH IN THIS LETTER OF TRANSMITTAL CAREFULLY. DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. DELIVERIES TO THE COMPANY WILL NOT BE FORWARDED TO THE DEPOSITARY AND THEREFORE WILL NOT CONSTITUTE VALID DELIVERY. DELIVERIES TO BOOK-ENTRY TRANSFER FACILITIES WILL NOT CONSTITUTE VALID DELIVERY TO THE DEPOSITARY. / / Check here if you cannot locate your certificates and require assistance in replacing them. Upon receipt of this Letter of Transmittal, the Depositary will contact you directly with replacement instructions. 2 This Letter of Transmittal is to be used only if certificates are to be forwarded herewith or if delivery of Shares (as defined below) is to be made by book-entry transfer to the Depositary's account at The Depository Trust Company ("DTC") or the Philadelphia Depository Trust Company ("PDTC") (hereinafter collectively referred to as the "Book Entry Transfer Facilities") pursuant to the procedures set forth in Section 3 of the Offer to Purchase (as defined below). THIS LETTER OF TRANSMITTAL MAY NOT BE USED TENDERING FOR SHARES REFLECTING INTERESTS IN THE COMPANY STOCK FUND CREDITED TO ACCOUNTS IN THE COMPANY'S 401(k) SAVINGS PLAN (THE "SAVINGS PLAN"). SEE INSTRUCTION 14. Shareholders who cannot deliver their Share certificates and any other required documents to the Depositary by the Expiration Date (as defined in the Offer to Purchase) must tender their Shares using the guaranteed delivery procedure set forth in Section 3 of the Offer to Purchase. See Instruction 2. - -------------------------------------------------------------------------------- (BOXES BELOW FOR USE BY ELIGIBLE INSTITUTIONS ONLY) / / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER TO THE DEPOSITARY'S ACCOUNT AT ONE OF THE BOOK-ENTRY TRANSFER FACILITIES AND COMPLETE THE FOLLOWING: Name of Tendering Institution Check Applicable Box: / / DTC / / PDTC Account No. Transaction Code No. / / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE FOLLOWING: Name(s) of Registered Holder(s) Date of Execution of Notice of Guaranteed Delivery Name of Institution that Guaranteed Delivery If delivery is by book-entry transfer: Name of Tendering Institution Account No. ____________ at / / DTC / / PDTC Transaction Code No. 2 3 LADIES AND GENTLEMEN: The undersigned hereby tenders to Handy & Harman, a New York corporation (the "Company"), the above-described shares of its common stock, par value $1.00 per share (including the associated common stock purchase rights) (the "Shares"), at the price per Share indicated in this Letter of Transmittal, net to the seller in cash, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated October 24, 1996 (the "Offer to Purchase"), receipt of which is hereby acknowledged, and in this Letter of Transmittal (which, as amended from time to time, together constitute the "Offer"). Subject to, and effective upon, acceptance for payment of and payment for the Shares tendered herewith in accordance with the terms and subject to the conditions of the Offer (including, if the Offer is extended or amended, the terms and conditions of any such extension or amendment), the undersigned hereby sells, assigns and transfers to, or upon the order of, the Company all right, title and interest in and to all the Shares that are being tendered hereby or orders the registration of such Shares tendered by book-entry transfer that are purchased pursuant to the Offer to or upon the order of the Company and hereby irrevocably constitutes and appoints the Depositary the true and lawful agent and attorney-in-fact of the undersigned with respect to such Shares, with full power of substitution (such power of attorney being deemed to be an irrevocable power coupled with an interest), to: (i) deliver certificates for such Shares, or transfer ownership of such Shares on the account books maintained by any of the Book-Entry Transfer Facilities, together, in any such case, with all accompanying evidences of transfer and authenticity, to or upon the order of the Company upon receipt by the Depositary, as the undersigned's agent, of the Purchase Price (as defined below) with respect to such Shares; (ii) present certificates for such Shares for cancellation and transfer on the books of the Company; and (iii) receive all benefits and otherwise exercise all rights of beneficial ownership of such Shares, all in accordance with the terms of the Offer. The undersigned hereby represents and warrants to the Company that the undersigned has full power and authority to tender, sell, assign and transfer the Shares tendered hereby and that, when and to the extent the same are accepted for payment by the Company, the Company will acquire good, marketable and unencumbered title thereto, free and clear of all liens, restrictions, charges, encumbrances, conditional sales agreements or other obligations relating to the sale or transfer thereof, and the same will not be subject to any adverse claims. The undersigned will, upon request, execute and deliver any additional documents deemed by the Depositary or the Company to be necessary or desirable to complete the sale, assignment and transfer of the Shares tendered hereby. The undersigned represents and warrants to the Company that the undersigned has read and agrees to all of the terms of the Offer. All authority herein conferred or agreed to be conferred shall not be affected by, and shall survive the death or incapacity of the undersigned, and any obligation of the undersigned hereunder shall be binding upon the heirs, personal representatives, successors and assigns of the undersigned. Except as stated in the Offer, this tender is irrevocable. The undersigned understands that tenders of Shares pursuant to any one of the procedures described in Section 3 of the Offer to Purchase and in the Instructions will constitute the undersigned's acceptance of the terms and conditions of the Offer, including the undersigned's representation and warranty to the Company that (i) the undersigned has a net long position in the Shares or equivalent securities being tendered within the meaning of Rule 14e-4 promulgated under the Securities Exchange Act of 1934, as amended, and (ii) the tender of such Shares complies with Rule 14e-4. The Company's acceptance for payment of Shares tendered pursuant to the Offer will constitute a binding agreement between the undersigned and the Company upon the terms and subject to the conditions of the Offer. The names and addresses of the registered holders should be printed, if they are not already printed above, exactly as they appear on the certificates representing Shares tendered hereby. The certificate numbers, the number of Shares represented by such certificates, the number of Shares that the undersigned wishes to tender and the purchase price at which such Shares are being tendered should be indicated in the appropriate boxes on this Letter of Transmittal. The undersigned understands that the Company will determine a single per Share price (not greater than $20.00 nor less than $17.50 per Share), net to the Seller in cash, that it will pay for Shares validly tendered and not withdrawn pursuant to the Offer (the "Purchase Price"), taking into account the number of Shares so tendered and the prices specified by tendering shareholders. The undersigned understands that the Company will select the lowest Purchase Price that will allow it to purchase 1,800,000 Shares (or such lesser number of Shares as are validly tendered at prices not greater than $20.00 nor less than $17.50 per Share) validly tendered and not withdrawn pursuant to the Offer. The undersigned understands that all Shares validly tendered at prices at or below the Purchase Price and not withdrawn will be purchased at the Purchase Price, net to the seller in cash, upon the terms and subject to the conditions of the Offer, including the proration provisions, and that the Company will return all other Shares, including Shares tendered at prices greater than the Purchase Price and not withdrawn and Shares not purchased because of proration. 3 4 The undersigned recognizes that, under certain circumstances set forth in the Offer to Purchase, the Company may terminate or amend the Offer or may postpone the acceptance for payment of, or the payment for, Shares tendered or may not be required to purchase any of the Shares tendered hereby or may accept for payment fewer than all of the Shares tendered hereby. Unless otherwise indicated under "Special Payment Instructions," please issue the check for the Purchase Price of any Shares purchased, and/or return any Shares not tendered or not purchased, in the name(s) of the undersigned (and, in the case of Shares tendered by book-entry transfer, by credit to the account at the applicable Book-Entry Transfer Facility). Similarly, unless otherwise indicated under "Special Delivery Instructions," please mail the check for the Purchase Price of any Shares purchased and/or any certificates for Shares not tendered or not purchased (and accompanying documents, as appropriate) to the undersigned at the address shown below the undersigned's signature(s). In the event that both "Special Payment Instructions" and "Special Delivery Instructions" are completed, please issue the check for the Purchase Price of any Shares purchased and/or return any Shares not tendered or not purchased in the name(s) of, and mail such check and/or any certificates to, the person(s) so indicated. The undersigned recognizes that the Company has no obligation, pursuant to the "Special Payment Instructions," to transfer any Shares from the name of the registered holder(s) thereof if the Company does not accept for payment any of the Shares so tendered. The undersigned understands that a tender of Shares pursuant to the Offer will include a tender of the associated common stock purchase rights (the "Rights") and that no separate consideration will be paid for such Rights. For a description of the Rights, see Section 7 of the Offer to Purchase. The undersigned understands that acceptance of Shares by the Company for payment will constitute a binding agreement between the undersigned and the Company upon the terms and subject to the conditions of the Offer. 4 5 NOTE: SIGNATURES MUST BE PROVIDED BELOW PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED - -------------------------------------------------------------------------------- IF SHARES ARE BEING TENDERED AT MORE THAN ONE PRICE, A SEPARATE LETTER OF TRANSMITTAL FOR EACH PRICE SPECIFIED MUST BE USED. (See Instruction 5.) - -------------------------------------------------------------------------------- CHECK ONLY ONE BOX. IF MORE THAN ONE BOX IS CHECKED, OR IF NO BOX IS CHECKED (EXCEPT AS PROVIDED IN THE ODD LOTS BOX AND INSTRUCTIONS BELOW), THERE IS NO VALID TENDER OF SHARES. - -------------------------------------------------------------------------------- / / $17.50 / / $18.00 / / $18.50 / / $19.00 / / $19.50 / / $20.00 / / $17.75 / / $18.25 / / $18.75 / / $19.25 / / $19.75
ODD LOTS (See Instruction 9.) This section is to be completed ONLY if Shares are being tendered by or on behalf of a person who owns beneficially, as of the close of business on October 23, 1996, and who continues to own beneficially as of the Expiration Date, an aggregate of fewer than 100 Shares (including Shares reflecting interests in the Company Stock Fund allocated to the Savings Plan but excluding Restricted Shares (as defined in the Offer to Purchase)). The undersigned either (check one box): / / owned beneficially, as of the close of business on October 23, 1996, and continues to own beneficially as of the Expiration Date, an aggregate of fewer than 100 Shares (including Shares reflecting interests in the Company Stock Fund allocated to the Savings Plan but excluding Restricted Shares), all of which are being tendered, or / / is a broker, dealer, commercial bank, trust company or other nominee that (i) is tendering, for the beneficial owners thereof, Shares with respect to which it is the record owner, and (ii) believes, based upon representations made to it by each such beneficial owner, that such beneficial owner owned beneficially, as of the close of business on October 23, 1996, and continues to own beneficially as of the Expiration Date, an aggregate of fewer than 100 Shares (including Shares reflecting interests in the Company Stock Fund allocated to the Savings Plan but excluding Restricted Shares) and is tendering all of such Shares. If you do not wish to specify a purchase price, check the following box, in which case you will be deemed to have tendered at the Purchase Price determined by the Company in accordance with the terms of the Offer (persons checking this box need not indicate the price per Share in the box entitled "Price (In Dollars) Per Share At Which Shares Are Being Tendered" in this Letter of Transmittal). See Instruction 5. / / 5 6 ------------------------------------------------------------ SPECIAL PAYMENT INSTRUCTIONS (SEE INSTRUCTIONS 1, 6, 7 AND 8) To be completed ONLY if the check for the aggregate Purchase Price of Shares purchased and/or certificates for Shares not tendered or not purchased are to be issued in the name of someone other than the undersigned. Issue: / / check and/or / / certificate(s) to: Name ------------------------------------------------------------ ------------------------------------------------------------ (PLEASE PRINT) Address ------------------------------------------------------------ ------------------------------------------------------------ (INCLUDE ZIP CODE) ------------------------------------------------------------ (TAXPAYER IDENTIFICATION OR SOCIAL SECURITY NO.) ------------------------------------------------------------ ------------------------------------------------------------ SPECIAL DELIVERY INSTRUCTIONS (SEE INSTRUCTIONS 6 AND 8) To be complete ONLY if the check for the Purchase Price of Shares purchased and/or certificates for Shares not tendered or not purchased are to be mailed to someone other than the undersigned or to the undersigned at an address other than that shown below the undersigned's signature(s). Mail: / / check and/or / / certificates to: Name ------------------------------------------------------------ ------------------------------------------------------------ (PLEASE PRINT) Address ------------------------------------------------------------ ------------------------------------------------------------ (INCLUDE ZIP CODE) ------------------------------------------------------------ 6 7 PLEASE SIGN HERE (TO BE COMPLETED BY ALL SHAREHOLDERS) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SIGNATURE(S) OF OWNER(S) Dated - --------------------------- , 1996 Name(s) ------------------------------------------------------------------------ (PLEASE PRINT) Capacity (full title) ----------------------------------------------------------------- Address------------------------------------------------------------------------- (INCLUDE ZIP CODE) Area Code and Telephone No. - -------------------------------------------------------------------------------- (Must be signed by registered holder(s) exactly as name(s) appear(s) on Share certificate(s) or on a security position listing or by person(s) authorized to become registered holder(s) by certificates and documents transmitted herewith. If signature is by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, please set forth full title and see Instruction 6.) GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 1 AND 6.) Name of Firm --------------------------------------------------------------------- Authorized Signature - -------------------------------------------------------------------------------- Name - -------------------------------------------------------------------------------- (PLEASE PRINT) Title - -------------------------------------------------------------------------------- Address - -------------------------------------------------------------------------------- (INCLUDE ZIP CODE) Area Code and Telephone No. - -------------------------------------------------------------------------------- Dated - --------------------------- , 1996 7 8 INSTRUCTIONS FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER 1. Guarantee of Signatures. Except as otherwise provided below, all signatures on this Letter of Transmittal must be guaranteed by a firm or other entity that is a member in good standing of the Security Transfer Agent's Medallion Program, the New York Stock Exchange Medallion Program or the Stock Exchange Medallion Program (an "Eligible Institution"), unless (i) this Letter of Transmittal is signed by the registered holder(s) of the Shares (which term, for purposes of this document, shall include any participant in a Book-Entry Transfer Facility whose name appears on a security position listing as the owner of Shares) tendered herewith and such holder(s) have not completed the box entitled "Special Payment Instructions" or the box entitled "Special Delivery Instructions" on this Letter of Transmittal, or (ii) such Shares are tendered for the account of an Eligible Institution. See Instruction 6. 2. Delivery of Letter of Transmittal and Share Certificates; Guaranteed Delivery Procedures. This Letter of Transmittal is to be used either if share certificates are to be forwarded herewith or if delivery of Shares is to be made by book-entry transfer pursuant to the procedures set forth in Section 3 of the Offer to Purchase. Certificates for all physically delivered Shares, or a confirmation of a book-entry transfer into the Depositary's account at one of the Book-Entry Transfer Facilities of all Shares delivered electronically, as well as a properly completed and duly executed Letter of Transmittal (or manually signed facsimile thereof) and any other documents required by this Letter of Transmittal, must be received by the Depositary at one of its addresses set forth on the front page of this Letter of Transmittal prior to the Expiration Date. If certificates are forwarded to the Depositary in multiple deliveries, a properly completed and duly executed Letter of Transmittal must accompany each such delivery. Shareholders whose share certificates are not immediately available, who cannot deliver their Shares and all other required documents to the Depositary or who cannot complete the procedure for delivery by book-entry transfer prior to the Expiration Date may tender their Shares pursuant to the guaranteed delivery procedure set forth in Section 3 of the Offer to Purchase. Pursuant to such procedure: (i) such tender must be made by or through an Eligible Institution, (ii) a properly completed and duly executed Notice of Guaranteed Delivery substantially in the form provided by the Company (with any required signature guarantees) must be received by the Depositary prior to the Expiration Date, and (iii) the certificates for all physically delivered Shares in proper form for transfer by delivery, or a confirmation of a book-entry transfer into the Depositary's account at one of the Book-Entry Transfer Facilities of all Shares delivered electronically, in each case together with a properly completed and duly executed Letter of Transmittal (or manually signed facsimile thereof) and any other documents required by this Letter of Transmittal, must be received by the Depositary within three New York Stock Exchange, Inc. trading days after the date the Depositary receives such Notice of Guaranteed Delivery, all as provided in Section 3 of the Offer to Purchase. THE METHOD OF DELIVERY OF ALL DOCUMENTS, INCLUDING SHARE CERTIFICATES, THE LETTER OF TRANSMITTAL AND ANY OTHER REQUIRED DOCUMENTS, IS AT THE ELECTION AND RISK OF THE TENDERING SHAREHOLDER, AND THE DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY. No alternative or contingent tenders will be accepted. By executing this Letter of Transmittal (or facsimile thereof), the tendering shareholder waives any right to receive any notice of the acceptance for payment of the Shares. 3. Inadequate Space. If the space provided herein is inadequate, the certificate numbers and/or the number of Shares should be listed on a separate signed schedule and attached to this Letter of Transmittal. 8 9 4. Partial Tenders (Not Applicable to Shareholders Who Tender by Book-Entry Transfer). If fewer than all the Shares represented by any certificate delivered to the Depositary are to be tendered, fill in the number of Shares that are to be tendered in the box entitled "Number of Shares Tendered." In such case, a new certificate for the remainder of the Shares represented by the old certificate will be sent to the person(s) signing this Letter of Transmittal, unless otherwise provided in the "Special Payment Instructions" or "Special Delivery Instructions" boxes on this Letter of Transmittal, as promptly as practicable following the expiration or termination of the Offer. All Shares represented by certificates delivered to the Depositary will be deemed to have been tendered unless otherwise indicated. 5. Indication of Price at Which Shares Are Being Tendered. For Shares to be validly tendered, the shareholder must check the box indicating the price per Share at which such shareholder is tendering Shares under "Price (In Dollars) Per Share At Which Shares Are Being Tendered" in this Letter of Transmittal, except that Odd Lot Owners (as defined in Section 2 of the Offer to Purchase) may check the box above in the section entitled "Odd Lots" indicating that such shareholder is tendering all Shares at the Purchase Price determined by the Company. ONLY ONE BOX MAY BE CHECKED. IF MORE THAN ONE BOX IS CHECKED, OR (OTHER THAN AS DESCRIBED ABOVE FOR ODD LOT OWNERS) IF NO BOX IS CHECKED, THERE IS NO VALID TENDER OF SHARES. A shareholder wishing to tender portions of such shareholder's Share holdings at different prices must complete a separate Letter of Transmittal for each price at which such shareholder wishes to tender each such portion of such shareholder's Shares. The same Shares cannot be tendered (unless previously validly withdrawn as provided in Section 4 of the Offer to Purchase) at more than one price. 6. Signatures On Letter Of Transmittal; Stock Powers and Endorsements. If this Letter of Transmittal is signed by the registered holder(s) of the Shares tendered hereby, the signatures(s) must correspond with the name(s) as written on the face of the certificates without alteration, enlargement or any change whatsoever. If any of the Shares tendered hereby are held of record by two or more persons, all such persons must sign this Letter of Transmittal. If any of the Shares tendered hereby are registered in different names on different certificates, it will be necessary to complete, sign and submit as many separate Letters of Transmittal (or facsimiles thereof) as there are different registrations of certificates. If this Letter of Transmittal is signed by the registered holder(s) of the Shares tendered hereby, no endorsements of certificates or separate stock powers are required unless payment of the Purchase Price is to be made to, or Shares not tendered or not purchased are to be registered in the name of, any person other than the registered holder(s), in which case the certificate(s) evidencing the Shares tendered hereby must be endorsed or accompanied by appropriate stock powers, in either case signed exactly as the name(s) of the registered holder(s) appear(s) on such certificates. Signatures on any such certificates or stock powers must be guaranteed by an Eligible Institution. See Instruction 1. If this Letter of Transmittal is signed by a person other than the registered holder(s) of the Shares tendered hereby, certificates evidencing the Shares tendered hereby must be endorsed or accompanied by appropriate stock powers, in either case, signed exactly as the name(s) of the registered holder(s) appear(s) on such certificate(s). Signature(s) on any such certificates or stock powers must be guaranteed by an Eligible Institution. See Instruction 1. If this Letter of Transmittal or any certificate or stock power is signed by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, such person should so indicate when signing, and proper evidence satisfactory to the Company of the authority of such person so to act must be submitted. 9 10 7. Stock Transfer Taxes. The Company will pay or cause to be paid any stock transfer taxes with respect to the sale and transfer of any Shares to it or its order pursuant to the Offer. If, however, payment of the aggregate Purchase Price is to be made to, or Shares not tendered or not purchased are to be registered in the name of, any person other than the registered holder(s), or if tendered Shares are registered in the name of any person other than the person(s) signing this Letter of Transmittal, the amount of any stock transfer taxes (whether imposed on the registered holder(s), such other person or otherwise) payable on account of the transfer to such person will be deducted from the Purchase Price unless satisfactory evidence of the payment of such taxes, or exemption therefrom, is submitted. See Section 5 of the Offer to Purchase. Except as provided in this Instruction 7, it will not be necessary to affix transfer tax stamps to the certificates representing Shares tendered hereby. 8. Special Payment and Delivery Instructions. If a check for the Purchase Price of any Shares tendered hereby is to be issued in the name of, and/or any Shares not tendered or not purchased are to be returned to, a person other than the person(s) signing this Letter of Transmittal, or if the check and/or any certificates for Shares not tendered or not purchased are to be mailed to someone other than the person(s) signing this Letter of Transmittal or to an address other than that shown above in the box captioned "Description of Shares Tendered," then the boxes captioned "Special Payment Instructions" and/or "Special Delivery Instructions" on this Letter of Transmittal should be completed. Shareholders tendering Shares by book-entry transfer will have any Shares not accepted for payment returned by crediting the account maintained by such shareholder at the Book-Entry Transfer Facility from which such transfer was made. 9. Odd Lots. As described in Section 1 of the Offer to Purchase, if fewer than all Shares validly tendered at or below the Purchase Price and not withdrawn prior to the Expiration Date are to be purchased, the Shares purchased first will consist of all Shares tendered by any shareholder who owned beneficially, as of the close of business on October 23, 1996, and continues to own beneficially as of the Expiration Date, an aggregate of fewer than 100 Shares (including Shares reflecting interests in the Company Stock Fund allocated to the Savings Plan but excluding Restricted Shares) and who validly tendered all such Shares at or below the Purchase Price (including by not designating a Purchase Price as described below). Partial tenders of Shares will not qualify for this preference and this preference will not be available unless the box captioned "Odd Lots" in this Letter of Transmittal and the Notice of Guaranteed Delivery, if any, is completed. Additionally, tendering holders of Odd Lots who do not wish to specify a purchase price may check the box above in the section entitled "Odd Lots" indicating that such shareholder is tendering all Shares at the Purchase Price determined by the Company. See Instruction 5. 10. Substitute Form W-9 and Form W-8. Under the United States federal income tax backup withholding rules, unless an exemption applies under the applicable law and regulations, 31% of the gross proceeds payable to a shareholder or other payee pursuant to the Offer must be withheld and remitted to the United States Treasury, unless the shareholder or other payee provides such person's taxpayer identification number (employer identification number or social security number) to the Depositary and certifies that such number is correct. Therefore, each tendering shareholder should complete and sign the Substitute Form W-9 included as part of the Letter of Transmittal so as to provide the information and certification necessary to avoid backup withholding, unless such shareholder otherwise establishes to the satisfaction of the Depositary that it is not subject to backup withholding. Certain shareholders (including, among others, all corporations and certain foreign shareholders (in addition to foreign corporations)) are not subject to these backup withholding and reporting requirements. In order for a foreign shareholder to qualify as an exempt recipient, that shareholder must submit an IRS Form W-8 or a Substitute Form W-8, signed under penalties of perjury, attesting to that shareholder's exempt status. Such statements may be obtained from the Depositary. 10 11 11. Withholding On Foreign Shareholders. Even if a foreign shareholder has provided the required certification to avoid backup withholding, the Depositary will withhold United States federal income taxes equal to 30% of the gross payments payable to a foreign shareholder or his or her agent unless the Depositary determines that an exemption from or a reduced rate of withholding is available pursuant to a tax treaty or that an exemption from withholding is applicable because such gross proceeds are effectively connected with the conduct of a trade or business in the United States. For this purpose, a foreign shareholder is a shareholder that is not (i) a citizen or resident of the United States, (ii) a corporation, partnership or other entity created or organized in or under the laws of the United States, any state or any political subdivision thereof or (iii) any estate or trust the income of which is subject to United States federal income taxation regardless of the source of such income. In order to obtain a reduced rate of withholding pursuant to a tax treaty, a foreign shareholder must deliver to the Depositary a properly completed IRS Form 1001. In order to obtain an exemption from withholding on the grounds that the gross proceeds paid pursuant to the Offer are effectively connected with the conduct of a trade or business within the United States, a foreign shareholder must deliver to the Depositary a properly completed IRS Form 4224. The Depositary will determine a shareholder's status as a foreign shareholder and eligibility for a reduced rate of, or an exemption from, withholding by reference to outstanding certificates or statements concerning eligibility for a reduced rate of, or exemption from, withholding (e.g., IRS Form 1001 or IRS Form 4224) unless facts and circumstances indicate that such reliance is not warranted. A foreign shareholder may be eligible to obtain a refund of all or a portion of any tax withheld if such shareholder meets the "complete redemption," "substantially disproportionate" or "not essentially equivalent to a dividend" test described in Section 14 of the Offer to Purchase or is otherwise able to establish that no tax or a reduced amount of tax is due. Backup withholding generally will not apply to amounts subject to the 30% or treaty-reduced rate of withholding. Foreign shareholders are urged to consult their tax advisors regarding the application of United States federal income tax withholding, including eligibility for a withholding tax reduction or exemption and refund procedures. 12. Requests for Assistance or Additional Copies. Any questions or requests for assistance may be directed to the Information Agent or the Dealer Manager at their respective telephone numbers and addresses listed below. Requests for additional copies of the Offer to Purchase, this Letter of Transmittal or other tender offer materials may be directed to the Information Agent or the Dealer Manager, and such copies will be furnished promptly at the Company's expense. Shareholders may also contact their local broker, dealer, commercial bank or trust company for documents relating to, or assistance concerning, the Offer. 13. Irregularities. All questions as to the number of Shares to be accepted, the price to be paid therefor and the validity, form, eligibility (including time of receipt) and acceptance for payment of any tender of Shares will be determined by the Company, in its sole discretion, which determination shall be final and binding on all parties. The Company reserves the absolute right to reject any or all tenders it determines not to be in proper form or the acceptance of or payment for which may, in the opinion of the Company's counsel be unlawful. The Company also reserves the absolute right to waive any of the conditions of the Offer and any defect or irregularity in the tender of any particular Shares or any particular shareholder. No tender of Shares will be deemed to be validly made until all defects or irregularities have been cured or waived. None of the Company, the Dealer Manager, the Depositary, the Information Agent or any other person is or will be obligated to give notice of any defects or irregularities in tenders, and none of them will incur any liability for failure to give any such notice. 14. Savings Plan; Restricted Shares. Participants in the Company's Savings Plan may not use this Letter of Transmittal to direct the tender of Shares reflecting interests in the Company Stock Fund credited to such participant's individual account, but must use the separate Direction Form sent to them by the Company. Restricted Shares (as defined in the Offer to Purchase) may not be tendered pursuant to the Offer until the applicable restriction period has expired. See Section 3 of the Offer to Purchase. 15. Order of Purchase in Event of Proration. As described in Section 1 of the Offer to Purchase, shareholders may designate the order in which their Shares are to be purchased in the event of proration. The order of purchase may affect whether any capital gain or loss recognized on the Shares purchased is long-term or short-term (depending on the holding period for the Shares purchased) and the amount of gain or loss recognized for federal income tax purposes. See Sections 1 and 14 of the Offer to Purchase. 11 12 16. Lost, Stolen or Destroyed Certificates. If your certificate(s) representing Shares have been lost, stolen or destroyed, so indicate on the front of this Letter of Transmittal. The Depositary will send you additional documentation that will need to be completed to effectively surrender such lost, stolen or destroyed certificates. IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A MANUALLY SIGNED FACSIMILE THEREOF) TOGETHER WITH SHARE CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER AND ALL OTHER REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY, OR THE NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE DEPOSITARY, PRIOR TO THE EXPIRATION DATE. SHAREHOLDERS ARE ENCOURAGED TO RETURN A COMPLETED SUBSTITUTE FORM W-9 WITH THEIR LETTER OF TRANSMITTAL. 12 13 - -------------------------------------------------------------------------------------------------------- PAYOR'S NAME: CHASEMELLON SHAREHOLDER SERVICES, L.L.C. - -------------------------------------------------------------------------------------------------------- - -------------------------------------------------------------------------------------------------------- SUBSTITUTE PART 1 -- Please provide your TIN in the -------------------------------------- FORM W-9 box at right and certify by signing and Social Security Number dating below. or Employer Identification Number ------------------------------------------------------------------------------------ DEPARTMENT OF THE PART 2 -- For Payees exempt from backup withholding, see the enclosed Guidelines TREASURY for Certification of Taxpayer Identification Number on Substitute Form W-9 and INTERNAL REVENUE complete as instructed therein. SERVICE ------------------------------------------------------------------------------------ PART 3 -- Awaiting TIN / / ------------------------------------------------------------------------------------ Certification -- Under penalties of perjury, I certify that (i) the number shown on this form is my correct Taxpayer Identification Number (or I am waiting for a number to be issued to me) and either (a) I have mailed or delivered an application to receive a taxpayer identification number to the appropriate IRS center or Social Security Administration office or (b) I intend to mail or deliver an application in the near future) and (ii) I am not subject to backup withholding because: (a) I am exempt from backup withholding; or (b) I have not been notified by the IRS that I am subject to backup withholding as a result of a failure to report all interest or dividends; or (c) the IRS has notified me that I am no longer subject to backup withholding. Certification instructions -- You must cross out Item (ii) above if you have been notified by the IRS that you are currently subject to backup withholding because of underreporting interest or dividends on your tax return. Signature Date ________________ Name (Please Print) Address (Include Zip Code) PAYOR'S REQUEST FOR TAXPAYER IDENTIFICATION NUMBER ("TIN") - --------------------------------------------------------------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THIS OFFER. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS. YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU ARE AWAITING YOUR TIN. - -------------------------------------------------------------------------------- CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER I certify under penalties of perjury that a TIN has not been issued to me, and either (1) I have mailed or delivered an application to receive a TIN to the appropriate IRS Center or Social Security Administration Office or (2) I intend to mail or deliver an application in the near future. I understand that if I do not provide a TIN by the time of payment, 31% of all payments made to me thereafter will be withheld until I provide a number. Signature Date _______________ 13 14 The Information Agent for the Offer is: (LOGO)vwx Wall Street Plaza New York, New York 10005 (800) 223-2064 (Toll Free) Banks and Brokers call collect: (212) 440-9800 The Dealer Manager for the Offer is: J.P. MORGAN SECURITIES INC. 60 Wall Street New York, New York 10260-0060 (212) 648-7833 (800) 576-9843 (Toll Free) EX-99.A3 4 NOTICE OF GUARANTEED DELIVERY 1 HANDY & HARMAN NOTICE OF GUARANTEED DELIVERY OF SHARES OF COMMON STOCK This form, or a form substantially equivalent to this form, must be used to accept the Offer (as defined below) if certificates for the shares of common stock of Handy & Harman are not immediately available, if the procedure for book-entry transfer cannot be completed on a timely basis, or if time will not permit all other documents required by the Letter of Transmittal to be delivered to the Depositary prior to the Expiration Date (as defined in Section 1 of the Offer to Purchase (defined below)). Such form may be delivered by hand or transmitted by mail or overnight courier, or (for Eligible Institutions only) by facsimile transmission, to the Depositary. See Section 3 of the Offer to Purchase. THE ELIGIBLE INSTITUTION THAT COMPLETES THIS FORM MUST COMMUNICATE THE GUARANTEE TO THE DEPOSITARY AND MUST DELIVER THE LETTER OF TRANSMITTAL AND CERTIFICATES FOR SHARES TO THE DEPOSITARY WITHIN THE TIME SHOWN HEREIN. FAILURE TO DO SO COULD RESULT IN A FINANCIAL LOSS TO SUCH ELIGIBLE INSTITUTION. The Depositary for the Offer is: CHASEMELLON SHAREHOLDER SERVICES, L.L.C. By Mail: By Facsimile Transmission: By Hand or By Overnight Courier: Reorganization Department (201) 329-8936 Reorganization Department Midtown Station 120 Broadway - 13th Floor P.O.Box 798 New York, NY 10271 New York, NY 10018
Confirm Receipt of Notice of Guaranteed Delivery: (201) 296-4983 DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE NUMBER OTHER THAN THE ONE LISTED ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. THIS FORM IS NOT TO BE USED TO GUARANTEE SIGNATURES. IF A SIGNATURE ON A LETTER OF TRANSMITTAL IS REQUIRED TO BE GUARANTEED BY AN ELIGIBLE INSTITUTION UNDER THE INSTRUCTIONS THERETO, SUCH SIGNATURE GUARANTEE MUST APPEAR IN THE APPLICABLE SPACE PROVIDED IN THE SIGNATURE BOX ON THE LETTER OF TRANSMITTAL. 2 Ladies and Gentlemen: The undersigned hereby tenders to Handy & Harman, a New York corporation (the "Company"), upon the terms and subject to the conditions set forth in the Offer to Purchase, dated October 24, 1996 (the "Offer to Purchase"), and the related Letter of Transmittal (which, as amended from time to time, together constitute the "Offer"), receipt of which is hereby acknowledged, the number of shares of common stock, par value $1.00 per share (including the associated common stock purchase rights) (the "Shares"), of the Company listed below, pursuant to the guaranteed delivery procedure set forth in Section 3 of the Offer to Purchase. The undersigned understands that a tender of Shares pursuant to the Offer will include a tender of the associated common stock purchase rights (the "Rights") and that no separate consideration will be paid for such Rights. For a description of the Rights, see Section 7 of the Offer to Purchase. Number of Shares: - ------------------------------------------------------------ ------------------------------------------------------------ Name(s) (Please Print) Certificate Nos.: (if available) - ------------------------------------------------------------ ------------------------------------------------------------ - ------------------------------------------------------------ ------------------------------------------------------------ (Address) If shares will be tendered by book-entry transfer: Name of Tendering Institution: - ------------------------------------------------------------ ------------------------------------------------------------ Area Code and Telephone Number Account No. - ------------ at (check one) / / The Depository Trust Company / / Philadelphia Depository Trust Company ------------------------------------------------------------ Signature(s) 2 3 PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED - -------------------------------------------------------------------------------- IF SHARES ARE BEING TENDERED AT MORE THAN ONE PRICE, A SEPARATE NOTICE OF GUARANTEED DELIVERY FOR EACH PRICE SPECIFIED MUST BE USED. - -------------------------------------------------------------------------------- CHECK ONLY ONE BOX. IF MORE THAN ONE BOX IS CHECKED, OR IF NO BOX IS CHECKED (EXCEPT AS PROVIDED IN THE ODD LOTS BOX AND INSTRUCTIONS BELOW), THERE IS NO VALID TENDER OF SHARES. - -------------------------------------------------------------------------------- / / $17.50 / / $18.00 / / $18.50 / / $19.00 / / $19.50 / / $20.00 / / $17.75 / / $18.25 / / $18.75 / / $19.25 / / $19.75
ODD LOTS This section is to be completed ONLY if Shares are being tendered by or on behalf of a person who owned beneficially, as of the close of business on October 23, 1996, and who continues to own beneficially as of the Expiration Date, an aggregate of fewer than 100 Shares (excluding Restricted Shares (as defined in the Offer to Purchase) but including Shares reflecting interests in the Company Stock Fund (as defined in the Offer to Purchase) allocated to the Savings Plan (as defined in the Offer to Purchase)). The undersigned either (check one box): / / owned beneficially, as of the close of business on October 23, 1996 and continues to own beneficially as of the Expiration Date, an aggregate of fewer than 100 Shares (excluding Restricted Shares but including Shares reflecting interests in the Company Stock Fund allocated to the Savings Plan), all of which are being tendered, or / / is a broker, dealer, commercial bank, trust company or other nominee that (i) is tendering, for the beneficial owners thereof, Shares with respect to which it is the record owner, and (ii) believes, based upon representations made to it by each such beneficial owner, that such beneficial owner owned beneficially, as of the close of business on October 23, 1996, and continues to own beneficially as of the Expiration Date, an aggregate of fewer than 100 Shares (excluding Restricted Shares but including Shares reflecting interests in the Company Stock Fund allocated to the Savings Plan) and is tendering all of such Shares. If you do not wish to specify a purchase price, check the following box, in which case you will be deemed to have tendered at the Purchase Price determined by the Company in accordance with the terms of the Offer (persons checking this box need not indicate the price per Share in the box entitled "Price (In Dollars) Per Share At Which Shares Are Being Tendered" above. / / 3 4 GUARANTEE (NOT TO BE USED FOR SIGNATURE GUARANTEE) The undersigned, a firm or other entity that is a member in good standing of the Security Transfer Agent's Medallion Program, the New York Stock Exchange Medallion Program or the Stock Exchange Medallion Program (an "Eligible Institution"), hereby guarantees (i) that the above-named person(s) has a net long position in the Shares being tendered within the meaning of Rule 14e-4 promulgated under the Securities Exchange Act of 1934, as amended, (ii) that such tender of Shares complies with Rule 14e-4, and (iii) to deliver to the Depositary at one of its addresses set forth above certificate(s) for the Shares tendered hereby, in proper form for transfer, or a confirmation of the book-entry transfer of the Shares tendered hereby into the Depositary's account at The Depository Trust Company or the Philadelphia Depository Trust Company, in each case together with a properly completed and duly executed Letter(s) of Transmittal (or manually signed facsimile(s) thereof), with any required signature guarantee(s) and any other required documents, all within three New York Stock Exchange, Inc. trading days after the date hereof. - ------------------------------------------------ ------------------------------------------------ Name of Firm Authorized Signature - ------------------------------------------------ ------------------------------------------------ Address Name - ------------------------------------------------ ------------------------------------------------ City, State, Zip Code Title - ------------------------------------------------ Area Code and Telephone Number
Dated: - -------------, 1996 DO NOT SEND SHARE CERTIFICATES WITH THIS FORM. YOUR SHARE CERTIFICATES MUST BE SENT WITH THE LETTER OF TRANSMITTAL. 4 EX-99.A4 5 BROKER DEALER LETTER 1 J.P. Morgan Securities Inc. 60 Wall Street New York, New York 10260 HANDY & HARMAN OFFER TO PURCHASE FOR CASH UP TO 1,800,000 SHARES OF ITS COMMON STOCK (INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS) AT A PURCHASE PRICE NOT GREATER THAN $20.00 NOR LESS THAN $17.50 PER SHARE THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY, NOVEMBER 21, 1996, UNLESS THE OFFER IS EXTENDED. October 24, 1996 To Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees: In our capacity as Dealer Manager, we are enclosing the material listed below relating to the offer of Handy & Harman, a New York corporation (the "Company"), to purchase up to 1,800,000 shares of its common stock, par value $1.00 per share, (including the associated common stock purchase rights) (the "Shares"), at prices not greater than $20.00 nor less than $17.50 per Share, net to the seller in cash, specified by tendering shareholders, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated October 24, 1996 (the "Offer to Purchase"), and in the related Letter of Transmittal (which, as amended from time to time, together constitute the "Offer"). The Company will determine a single price (not greater than $20.00 nor less than $17.50 per Share), net to the seller in cash, that it will pay for Shares validly tendered and not withdrawn pursuant to the Offer (the "Purchase Price"), taking into account the number of Shares so tendered and the prices specified by tendering shareholders. The Company will select the lowest Purchase Price that will allow it to purchase 1,800,000 Shares (or such lesser number of Shares as is validly tendered at prices not greater than $20.00 nor less than $17.50 per Share) and not withdrawn pursuant to the Offer. The Company will purchase all Shares validly tendered at prices at or below the Purchase Price and not withdrawn, upon the terms and subject to the conditions of the Offer, including the provisions relating to proration described in the Offer to Purchase. See Section 1 of the Offer to Purchase. The Purchase Price will be paid in cash, net to the seller, with respect to all Shares purchased. Shares tendered at prices in excess of the Purchase Price and Shares not purchased because of proration will be returned. A tender of Shares pursuant to the Offer will include a tender of the associated common stock purchase rights (the "Rights"). No separate consideration will be paid for such Rights. For a description of the Rights, see Section 7 of the Offer to Purchase. THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS. SEE SECTION 6 OF THE OFFER TO PURCHASE. We are asking you to contact your clients for whom you hold Shares registered in your name (or in the name of your nominee) or who hold Shares registered in their own names. Please bring the Offer to their 2 attention as promptly as possible. The Company will, upon request, reimburse you for reasonable and customary handling and mailing expenses incurred by you in forwarding any of the enclosed materials to your clients. For your information and for forwarding to your clients, we are enclosing the following documents: 1. The Offer to Purchase. 2. The Letter of Transmittal for your use and for the information of your clients. 3. A letter to shareholders of the Company from the Chairman and Chief Executive Officer of the Company. 4. The Notice of Guaranteed Delivery to be used to accept the Offer if the Shares and all other required documents cannot be delivered to the Depositary by the Expiration Date (each as defined in the Offer to Purchase). 5. A letter that may be sent to your clients for whose accounts you hold Shares registered in your name or in the name of your nominee, with space for obtaining such clients' instructions with regard to the Offer. 6. Guidelines of the Internal Revenue Service for Certification of Taxpayer Identification Number on Substitute Form W-9 providing information relating to backup federal income tax withholding. 7. A return envelope addressed to ChaseMellon Shareholder Services, L.L.C., the Depositary. WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY, NOVEMBER 21, 1996, UNLESS THE OFFER IS EXTENDED. The Company will not pay any fees or commissions to any broker, dealer or other person for soliciting tenders of Shares pursuant to the Offer (other than the Dealer Manager). The Company will, upon request, reimburse brokers, dealers, commercial banks and trust companies for reasonable and customary handling and mailing expenses incurred by them in forwarding materials relating to the Offer to their customers. The Company will pay all stock transfer taxes applicable to its purchase of Shares pursuant to the Offer, subject to Instruction 7 of the Letter of Transmittal. As described in the Offer to Purchase, if more than 1,800,000 Shares have been validly tendered at or below the Purchase Price and not withdrawn prior to the Expiration Date, as defined in Section 1 of the Offer to Purchase, the Company will accept Shares for purchase in the following order of priority: (i) all Shares validly tendered at or below the Purchase Price and not withdrawn prior to the Expiration Date by any shareholder who owned beneficially, as of the close of business on October 23, 1996, and who continues to own beneficially as of the Expiration Date, an aggregate of fewer than 100 Shares (excluding Restricted Shares (as defined in the Offer to Purchase) but including Shares reflecting interests in the Company Stock Fund (as defined in the Offer to Purchase) allocated to the Savings Plan (as defined in the Offer to Purchase)) and who validly tenders all of such Shares (partial tenders will not qualify for this preference) and completes the box captioned "Odd Lots" in the Letter of Transmittal and, if applicable, the Notice of Guaranteed Delivery; and (ii) after purchase of all of the foregoing Shares, all other Shares validly tendered at or below the Purchase Price and not withdrawn prior to the Expiration Date on a pro rata basis. THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE MAKING OF THE OFFER. HOWEVER, SHAREHOLDERS MUST MAKE THEIR OWN DECISIONS WHETHER TO TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND THE PRICE OR PRICES AT WHICH SHARES SHOULD BE TENDERED. NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO ANY SHAREHOLDER AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING SHARES. THE COMPANY HAS BEEN ADVISED THAT NONE OF ITS DIRECTORS OR EXECUTIVE OFFICERS INTENDS TO TENDER ANY SHARES PURSUANT TO THE OFFER. 2 3 Any questions or requests for assistance or additional copies of the enclosed materials may be directed to the Information Agent or the Dealer Manager at their respective addresses and telephone numbers set forth on the back cover of the enclosed Offer to Purchase. Very truly yours, J.P. MORGAN SECURITIES INC. NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY OTHER PERSON THE AGENT OF THE COMPANY, THE DEALER MANAGER, THE INFORMATION AGENT OR THE DEPOSITARY, OR AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY STATEMENT ON BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE DOCUMENTS ENCLOSED HEREWITH AND THE STATEMENTS CONTAINED THEREIN. 3 EX-99.A5 6 LETTER TO CLIENTS 1 HANDY & HARMAN OFFER TO PURCHASE FOR CASH UP TO 1,800,000 SHARES OF ITS COMMON STOCK (INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS) AT A PURCHASE PRICE NOT GREATER THAN $20.00 NOR LESS THAN $17.50 PER SHARE THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY, NOVEMBER 21, 1996, UNLESS THE OFFER IS EXTENDED To Our Clients: Enclosed for your consideration are the Offer to Purchase, dated October 24, 1996 (the "Offer to Purchase"), and the related Letter of Transmittal (which, as amended from time to time, together constitute the "Offer") setting forth an offer by Handy & Harman, a New York corporation (the "Company"), to purchase up to 1,800,000 shares of its common stock, par value $1.00 per share (including the associated common stock purchase rights) (the "Shares"), at prices not greater than $20.00 nor less than $17.50 per Share, net to the seller in cash, specified by tendering shareholders, upon the terms and subject to the conditions of the Offer. Also enclosed herewith is certain other material related to the Offer, including a letter to shareholders from Richard N. Daniel, Chairman and Chief Executive Officer of the Company. The Company will determine a single per Share price (not greater than $20.00 nor less than $17.50 per Share) that it will pay for the Shares validly tendered pursuant to the Offer and not withdrawn (the "Purchase Price"), taking into account the number of Shares so tendered and the prices specified by tendering shareholders. The Company will select the lowest Purchase Price that will allow it to purchase 1,800,000 Shares (or such lesser number of Shares as are validly tendered at prices not greater than $20.00 nor less than $17.50 per Share) validly tendered and not withdrawn pursuant to the Offer. The Company will purchase all Shares validly tendered at prices at or below the Purchase Price and not withdrawn, upon the terms and subject to the conditions of the Offer, including the provisions thereof relating to proration. See Section 1 of the Offer to Purchase. A tender of Shares pursuant to the Offer will include a tender of the associated common stock purchase rights (the "Rights"). No separate consideration will be paid for such Rights. For a description of the Rights, see Section 7 of the Offer to Purchase. WE ARE THE HOLDER OF RECORD OF SHARES HELD FOR YOUR ACCOUNT. AS SUCH, A TENDER OF SUCH SHARES CAN BE MADE ONLY BY US AS THE HOLDER OF RECORD AND PURSUANT TO YOUR INSTRUCTIONS. THE LETTER OF TRANSMITTAL IS FURNISHED TO YOU FOR YOUR INFORMATION ONLY AND CANNOT BE USED BY YOU TO TENDER SHARES HELD BY US FOR YOUR ACCOUNT. We request instructions as to whether you wish us to tender any or all of the Shares held by us for your account, upon the terms and subject to the conditions set forth in the Offer to Purchase and the Letter of Transmittal. Your attention is invited to the following: 1. You may tender Shares at prices (in multiples of $.25), not greater than $20.00 nor less than $17.50 per Share, as indicated in the attached Instruction Form, net to you in cash. 2 2. The Offer is for up to 1,800,000 Shares, constituting approximately 13% of the total Shares outstanding as of October 16, 1996. The Offer is not conditioned on any minimum number of Shares being tendered. The Offer is, however, subject to certain other conditions set forth in the Offer to Purchase. 3. The Offer, proration period and withdrawal rights will expire at 12:00 Midnight, New York City time, on Thursday, November 21, 1996, unless the Offer is extended. Your instructions to us should be forwarded to us in ample time to permit us to submit a tender on your behalf. 4. As described in the Offer to Purchase, if more than 1,800,000 Shares have been validly tendered at or below the Purchase Price and not withdrawn prior to the Expiration Date, as defined in Section 1 of the Offer to Purchase, the Company will purchase Shares in the following order of priority: (i) all Shares validly tendered at or below the Purchase Price and not withdrawn prior to the Expiration Date by any shareholder who owned beneficially, as of the close of business on October 23, 1996, and who continues to own beneficially as of the Expiration Date, an aggregate of fewer than 100 Shares (including Shares reflecting interests in the Company Stock Fund (as defined in the Offer to Purchase) allocated to the Savings Plan (as defined in the Offer to Purchase) but excluding Restricted Shares (as defined in the Offer to Purchase)) who validly tenders all of such Shares (partial tenders will not qualify for this preference) and completes the box captioned "Odd Lots" in the Letter of Transmittal and, if applicable, the Notice of Guaranteed Delivery; and (ii) after purchase of all the foregoing Shares, all other Shares validly tendered at or below the Purchase Price and not withdrawn prior to the Expiration Date on a pro rata basis. See Section 1 of the Offer to Purchase for a discussion of proration. 5. Tendering shareholders will not be obligated to pay any brokerage commissions or solicitation fees on the Company's purchase of Shares in the Offer. Any stock transfer taxes applicable to the purchase of Shares by the Company pursuant to the Offer will be paid by the Company, except as otherwise provided in Instruction 7 of the Letter of Transmittal. 6. If you wish to tender portions of your Shares at different prices you must complete a separate Instruction Form for each price at which you wish to tender each portion of your Shares. We must submit separate Letters of Transmittal on your behalf for each price you will accept. 7. If you owned beneficially, as of the close of business on October 23, 1996, and continue to own beneficially as of the Expiration Date, an aggregate of fewer than 100 Shares (including Shares reflecting interests in the Company Stock Fund allocated to the Savings Plan but excluding Restricted Shares), and you instruct us to tender at or below the Purchase Price on your behalf all such Shares prior to the Expiration Date and check the box captioned "Odd Lots" in the Instruction Form, all such Shares will be accepted for purchase before proration, if any, of the purchase of other tendered Shares. THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE MAKING OF THE OFFER. HOWEVER, SHAREHOLDERS MUST MAKE THEIR OWN DECISIONS WHETHER TO TENDER SHARES AND, IF SO, HOW MANY SHARES TO TENDER AND THE PRICE OR PRICES AT WHICH SHARES SHOULD BE TENDERED. NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO ANY SHAREHOLDER AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING SHARES. THE COMPANY HAS BEEN ADVISED THAT NONE OF ITS DIRECTORS OR EXECUTIVE OFFICERS INTENDS TO TENDER ANY SHARES PURSUANT TO THE OFFER. If you wish to have us tender any or all of your Shares held by us for your account upon the terms and subject to the conditions set forth in the Offer to Purchase, please so instruct us by completing, executing and returning to us the attached Instruction Form. An envelope to return your instructions to us is enclosed. If you authorize tender of your Shares, all such Shares will be tendered unless otherwise specified on the Instruction Form. YOUR INSTRUCTIONS SHOULD BE FORWARDED TO US IN AMPLE TIME TO PERMIT US TO SUBMIT A TENDER ON YOUR BEHALF PRIOR TO THE EXPIRATION OF THE OFFER. 2 3 The Offer is being made to all holders of Shares. The Company is not aware of any jurisdiction where the making of the Offer is not in compliance with applicable law. If the Company becomes aware of any jurisdiction where the making of the Offer is not in compliance with any valid applicable law, the Company will make a good faith effort to comply with such law. If, after such good faith effort, the Company cannot comply with such law, the Offer will not be made to (nor will tenders be accepted from or on behalf of) the holders of Shares residing in such jurisdiction. In any jurisdiction the securities or blue sky laws of which require the Offer to be made by a licensed broker or dealer, the Offer is being made on the Company's behalf by the Dealer Manager or one or more registered brokers or dealers licensed under the laws of such jurisdiction. 3 4 INSTRUCTION FORM WITH RESPECT TO OFFER TO PURCHASE FOR CASH UP TO 1,800,000 SHARES OF COMMON STOCK OF HANDY & HARMAN AT A PURCHASE PRICE NOT GREATER THAN $20.00 NOR LESS THAN $17.50 PER SHARE The undersigned acknowledge(s) receipt of your letter and the enclosed Offer to Purchase, dated October 24, 1996, and the related Letter of Transmittal (which, as amended from time to time, together constitute the "Offer") in connection with the Offer by Handy & Harman (the "Company") to purchase up to 1,800,000 shares of its common stock, par value $1.00 per share (the "Shares"), at prices not greater than $20.00 nor less than $17.50 per Share, net to the undersigned in cash, specified by the undersigned, upon the terms and subject to the terms and conditions of the Offer. The undersigned further acknowledge(s) that a tender of Shares pursuant to the Offer will include a tender of the associated common stock purchase rights (the "Rights"), and that no separate consideration will be paid for such Rights. For a description of the Rights, see Section 7 of the Offer to Purchase. This will instruct you to tender to the Company the number of Shares indicated below (or, if no number is indicated below, all Shares) that are held by you for the account of the undersigned, at the price per Share indicated below, upon the terms and subject to the conditions of the Offer. SHARES TENDERED / / By checking this box, all Shares held by us for your account will be tendered. If fewer than all Shares are to be tendered, please check the box and indicate below the aggregate number of Shares to be tendered by us. --------------------------- Shares Unless otherwise indicated, it will be assumed that all Shares held by us for your account are to be tendered. 5 PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED IF SHARES ARE BEING TENDERED AT MORE THAN ONE PRICE, A SEPARATE INSTRUCTION FORM FOR EACH PRICE SPECIFIED MUST BE USED. CHECK ONLY ONE BOX. IF MORE THAN ONE BOX IS CHECKED, OR IF NO BOX IS CHECKED (EXCEPT AS PROVIDED IN THE ODD LOTS BOX AND INSTRUCTIONS BELOW), THERE IS NO VALID TENDER OF SHARES. / /$17.50 / /$18.00 / /$18.50 / /$19.00 / /$19.50 / /$20.00 / /$17.75 / /$18.25 / /$18.75 / /$19.25 / /$19.75
ODD LOTS / / By checking this box, the undersigned represent(s) that the undersigned owned beneficially, as of the close of business on October 23, 1996, and continue(s) to own beneficially as of the Expiration Date, an aggregate of fewer than 100 Shares (excluding Restricted Shares but including Shares reflecting interests in the Company Stock Fund allocated to the Savings Plan) and is tendering all of such Shares. If you do not wish to specify a purchase price, check the following box, in which case you will be deemed to have tendered at the Purchase Price determined by the Company in accordance with the terms of the Offer (persons checking this box need not indicate the price per Share in the box entitled "Price (In Dollars) Per Share At Which Shares Are Being Tendered"). / / THE METHOD OF DELIVERY OF THIS DOCUMENT IS AT THE ELECTION AND RISK OF THE TENDERING SHAREHOLDERS. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE DELIVERY. SIGN HERE ----------------------------------------------------------- Signature(s) Dated: , 1996 Name Address ----------------------------------------------------------- ----------------------------------------------------------- ----------------------------------------------------------- Social Security or Taxpayer ID No.
EX-99.A6 7 SHAREHOLDERS LETTER 1 HANDY & HARMAN LOGO RICHARD N. DANIEL CHAIRMAN AND CHIEF EXECUTIVE OFFICER October 24, 1996 Dear Shareholder: Handy & Harman (the "Company") is offering to purchase up to 1,800,000 shares of its common stock at a price not greater than $20.00 nor less than $17.50 per share. The Company is conducting the Offer through a procedure commonly referred to as a "modified Dutch auction." This procedure allows you to select the price within the specified price range at which you are willing to sell all or a portion of your shares to the Company. The Offer is explained in detail in the enclosed Offer to Purchase and Letter of Transmittal. If you wish to tender your shares, instructions on how to tender shares are provided in the enclosed materials. I encourage you to read these materials carefully before making any decision with respect to the Offer. Neither the Company nor its Board of Directors makes any recommendation to any shareholder whether or not to tender any or all shares. Please note that the Offer is scheduled to expire at 12:00 Midnight, New York City time, on Thursday, November 21, 1996, unless extended by the Company. Questions regarding the Offer should not be directed to the Company but should instead be directed to Georgeson & Company Inc., the Information Agent, at 1(800)223-2064. Sincerely, Richard N. Daniel Chairman and Chief Executive Officer EX-99.A7 8 COMPANY SAVINGS PLAN LETTER 1 HANDY & HARMAN LOGO IMMEDIATE ATTENTION REQUIRED October 24, 1996 Re: Handy & Harman Savings Plan Dear Participant in the Handy & Harman Savings Plan: Handy & Harman (the "Company") announced on Tuesday, October 22, that the Company's Board of Directors has approved a plan to repurchase up to 1,800,000 shares of its common stock. In this repurchase plan, called a modified Dutch auction tender offer, shareholders have an opportunity to sell their shares at prices within a range of not greater than $20.00 nor less than $17.50 per share. After shares are tendered by shareholders, the Company selects a price and buys back shares that have been tendered at or below such price which will be within that range. Enclosed are tender offer materials and a Direction Form that require your immediate attention. These materials contain important information about the tender offer and should be carefully reviewed. Our records reflect that a portion of your individual account in the Handy & Harman 401(k) savings plan (the "Savings Plan") is invested in the Handy & Harman Stock Fund. As described below, you have the right to instruct the Handy & Harman Savings Plan Administration Committee (the "Plan Administration Committee") and T. Rowe Price Trust Company ("T. Rowe Price"), as Trustee of the Savings Plan, concerning whether and on what terms to tender shares attributable to your individual account under the Savings Plan. YOU WILL NEED TO COMPLETE THE ENCLOSED DIRECTION FORM AND RETURN IT IN THE ENCLOSED RETURN ENVELOPE SO THAT IT IS RECEIVED BY 12:00 MIDNIGHT, NEW YORK CITY TIME, ON MONDAY, NOVEMBER 18, 1996, UNLESS EXTENDED. PLEASE COMPLETE AND RETURN THE DIRECTION FORM EVEN IF YOU DECIDE NOT TO PARTICIPATE IN THE TENDER OFFER DESCRIBED BELOW. The remainder of this letter summarizes the transaction, your rights under the Savings Plan and the procedures for completing the Direction Form. You should also review the more detailed explanation provided in the other materials including the Offer to Purchase and the related Letter of Transmittal enclosed with this letter. For purposes of this letter, unless otherwise provided, the term "participant" means an actual participant in the Savings Plan, the beneficiary of a deceased actual participant and an alternative payee with respect to an actual participant (i.e., a spouse, former spouse, child or other dependent of an actual participant who has an interest in a Savings Plan individual account pursuant to a qualified domestic relations order). 2 BACKGROUND The Company has made a tender offer to purchase up to 1,800,000 shares of its common stock, par value $1.00 per share (including the associated common stock purchase rights) (the "Shares"), at prices not greater than $20.00 nor less than $17.50 per Share. The enclosed Offer to Purchase, dated October 24, 1996 ("Offer to Purchase"), and the related Letter of Transmittal (which, as amended from time to time, together constitute the "Offer") set forth the objectives, terms and conditions of the Offer and are being provided to all of the Company's shareholders. A tender of Shares pursuant to the Offer will include a tender of the associated common stock purchase rights (the "Rights"). No separate consideration will be paid for such Rights. For a description of the Rights, see Section 7 of the Offer to Purchase. The Offer extends to the approximately 183,539 Shares currently held by the Savings Plan. Only T. Rowe Price as Trustee of the Savings Plan can tender these Shares for sale. Nonetheless, as a Savings Plan participant, you have the right to direct the Plan Administration Committee and T. Rowe Price whether or not to tender some or all of the Shares attributable to your individual account in the Savings Plan. If you direct the Plan Administration Committee and T. Rowe Price to tender any of the Shares attributable to your individual account, you must also specify the price or prices at which the Shares should be tendered. Please note that T. Rowe Price is the holder of record of Shares attributable to your individual account under the Savings Plan. A tender of such Shares can be made only by T. Rowe Price as the holder of record. The Letter of Transmittal is furnished to you for your information only and cannot be used by you to tender Shares attributable to your individual account under the Savings Plan. NONE OF THE COMPANY, ITS BOARD OF DIRECTORS, THE PLAN ADMINISTRATION COMMITTEE, T. ROWE PRICE, ITS AFFILIATES, OR ANY OTHER PARTY MAKES ANY RECOMMENDATIONS AS TO WHETHER TO DIRECT THE TENDER OF SHARES, THE PRICE AT WHICH TO TENDER, OR WHETHER TO REFRAIN FROM DIRECTING THE TENDER OF SHARES. EACH PARTICIPANT MUST MAKE HIS OR HER OWN DECISION ON THESE MATTERS. T. Rowe Price has been directed by the Plan Administration Committee to follow, on a timely basis, completed Direction Forms of participants with respect to the Offer. T. Rowe Price has been directed by the Plan Administration Committee NOT to tender Shares attributable to the individual accounts of participants from whom T. Rowe Price has not received timely, properly completed Direction Forms. Only in the event that T. Rowe Price determines that such directions violate the Employee Retirement Income Security Act of 1974 as amended ("ERISA") will T. Rowe Price exercise discretion with respect to the tender of Shares held by the Savings Plan. CONFIDENTIALITY To assure the confidentiality of your decision, T. Rowe Price and its affiliates or agents will tabulate the Direction Forms. Neither T. Rowe Price nor its affiliates or agents will make the results of your individual direction available to the Company. HOW THE OFFER WORKS The details of the Offer are described in the enclosed materials, which you should review carefully. However, in broad outline, the transaction will work as follows with respect to Savings Plan participants. - The Company has offered to purchase up to 1,800,000 of its Shares at a single per Share price not greater than $20.00 nor less than $17.50. - If you want any of the Shares attributable to your individual account under the Savings Plan sold on the terms and subject to the conditions of the Offer, you need to instruct the Plan Administration Committee and T. Rowe Price by completing the enclosed Direction Form and returning it in the enclosed return envelope. 2 3 - As described in Section 1 of the Offer to Purchase, if fewer than all Shares validly tendered at or below the Purchase Price (as defined in the Offer to Purchase) and not withdrawn prior to the Expiration Date (as defined in the Offer to Purchase) are to be purchased, the Shares purchased first will consist of all Shares tendered by "Odd Lot Owners" who validly tendered all of their Shares at or below the Purchase Price (including by not designating a Purchase Price as set forth in the Odd Lot section of the Direction Form). "Odd Lot Owners" are shareholders, including participants in the Savings Plan with Shares credited to their individual accounts under the Savings Plan, who owned beneficially as of the close of business on October 23, 1996, and continue to own beneficially as of the Expiration Date, an aggregate of fewer than 100 Shares (including Shares credited to such participant's account under the Savings Plan but excluding Restricted Shares (as defined in the Offer to Purchase)). Partial tenders of Shares will not qualify for this preference and this preference will not be available unless the box captioned "Odd Lots" in the Direction Form is completed. Additionally, tendering holders of Odd Lots who do not wish to specify a purchase price may check the box in the section entitled "Odd Lots" indicating that such shareholder is tendering all Shares at the Purchase Price determined by the Company. - You need to specify on the Direction Form the per Share price(s) (in multiples of $.25), not greater than $20.00 nor less than $17.50, at which you wish to tender the Shares attributable to your individual account under the Savings Plan, except that tendering Odd Lot Owners who do not wish to specify a purchase price may check the box in the section entitled "Odd Lots" indicating that such shareholder is tendering all Shares at the Purchase Price determined by the Company. - The Offer, proration period and withdrawal rights will expire at 12:00 Midnight, New York City time, on November 21, 1996, unless the Company extends the Offer. ACCORDINGLY, IN ORDER FOR T. ROWE PRICE TO MAKE A TIMELY TENDER OF THE SHARES ATTRIBUTABLE TO YOUR INDIVIDUAL ACCOUNT UNDER THE SAVINGS PLAN, YOU MUST COMPLETE AND RETURN THE ENCLOSED DIRECTION FORM IN THE RETURN ENVELOPE SO THAT IT IS RECEIVED BY T. ROWE PRICE AT THE ADDRESS ON THE RETURN ENVELOPE NOT LATER THAN 12:00 MIDNIGHT, NEW YORK CITY TIME, ON MONDAY, NOVEMBER 18, 1996, UNLESS EXTENDED. Please complete and return the direction form even if you decide not to participate in the Offer. If T. Rowe Price does not receive a completed, signed original Direction Form from you by such deadline, pursuant to the terms of the Trust Agreement relating to the Savings Plan, T. Rowe Price will NOT tender any of your Shares unless such Trust Agreement provision violates ERISA. - After the deadline above for returning the Direction Form to T. Rowe Price, T. Rowe Price and its affiliates or agents will complete the tabulation of all directions and T. Rowe Price, as Trustee, will tender the appropriate number of Shares. For purposes of this tabulation, T. Rowe Price will calculate the number of Shares representing your interest in the Company Stock Fund allocated to your individual account based upon the number of Shares held by the Company Stock Fund as of the close of business on October 23, 1996. - The Company will then determine the per Share purchase price (not greater than $20.00 nor less than $17.50) (the "Purchase Price"), at which the Company can purchase 1,800,000 Shares. - Unless the Offer is terminated or amended in accordance with its terms, the Company will then buy all of the Shares, up to 1,800,000, that were tendered at the Purchase Price or below. Participants will receive the same per Share Purchase Price, even if they tendered at or below the Purchase Price. - If you direct the tender of any Shares attributable to your individual account at a price in excess of the Purchase Price as finally determined, those Shares will not be purchased, and your interest in the Company Stock Fund will remain allocated to your individual account under the Savings Plan. - If there is an excess of Shares tendered over the exact number desired by the Company at the Purchase Price, Shares tendered pursuant to the Offer may be subject to proration as set forth in Section 1 of the Offer to Purchase. However, as described above, all Shares tendered by participants who are Odd Lot Owners in accordance with Section 2 of the Offer to Purchase will be purchased in the Offer without proration. 3 4 - IMPORTANT: IF YOU DIRECT THE PLAN ADMINISTRATION COMMITTEE AND T. ROWE PRICE TO TENDER SAVINGS PLAN SHARES REFLECTING YOUR INTEREST IN THE COMPANY STOCK FUND AND THEY ARE REPURCHASED BY THE COMPANY, ANY PROCEEDS WILL BE REINVESTED IN THE T. ROWE PRICE PRIME RESERVE ACCOUNT AS SOON AS ADMINISTRATIVELY POSSIBLE AND SUCH INVESTMENT WILL BE CREDITED TO YOUR INDIVIDUAL ACCOUNT. - IF YOU WISH TO HAVE ANY PROCEEDS OF THE SALE OF SHARES REFLECTING YOUR INTEREST IN THE COMPANY STOCK FUND WHICH WERE REINVESTED IN THE T. ROWE PRICE PRIME RESERVE ACCOUNT INVESTED IN A DIFFERENT MANNER, SUBJECT TO THE PROVISIONS OF THE SAVINGS PLAN, PLEASE CALL T. ROWE PRICE AT 1-800-922-9945 AFTER THE REINVESTMENT IS COMPLETE. -- Only after such time will you be able to instruct T. Rowe Price to invest any proceeds of the sale of shares reflecting your interest in the Company Stock Fund (which will be invested in the T. Rowe Price Prime Reserve Account) in any other manner. This form of transaction is commonly called a modified Dutch auction and requires some strategy on your part. For example, if you are anxious to sell, you may want to tender the Shares attributable to your individual account at a price at or near the lower limit. If you are not sure whether or not you want to participate, but would be willing to sell at a price above the lower limit, then you may want to specify a higher price, not to exceed the upper limit, of course. If you do not want to sell for any price within the limits, you may direct that Shares attributable to your individual account not be tendered into the Offer. PROCEDURE FOR DIRECTING TRUSTEE A Direction Form for making your direction is enclosed. You must complete, sign and return the enclosed original Direction Form in the return envelope so that it is received at the address listed on the enclosed return envelope not later than 12:00 Midnight, New York City time, on Monday, November 18, 1996, unless extended. PLEASE COMPLETE AND RETURN THE DIRECTION FORM EVEN IF YOU DECIDE NOT TO PARTICIPATE IN THE OFFER. If your Direction Form is not received by this deadline, or if it is not fully or properly completed, the Shares attributable to your individual account under the Savings Plan will not be tendered. Please contact T. Rowe Price at 1 (800) 922-9945 to find out the actual number of Shares attributable to your individual account that you may tender in the Offer. To properly complete your Direction Form, you must do the following: (1) On the back of the Direction Form, check Box 1 or 2. CHECK ONLY ONE BOX. Make your decision which box to check as follows: - CHECK BOX 1 if you do not want the Shares attributable to your individual account tendered for sale at any price and simply want the Savings Plan to continue holding such Shares. - CHECK BOX 2 in all other cases and either (i) complete the table immediately below Box 2, specifying the percentage of Shares attributable to your individual account that you want to tender at each price indicated, or (ii) if you are an Odd Lot Owner and you wish to tender all of the Shares attributable to your individual account, complete the section entitled "Odd Lots." If you do not complete the section entitled "Odd Lots," you may direct the tender of Shares attributable to your individual account at different prices. To do so, you must state the percentage of Shares to be sold at each indicated price by filling in the percentage of such Shares on the line immediately before the price. Leave a line blank if you want no Shares reflecting your interest in the Company Stock Fund tendered at that price. The total percentage of Shares reflecting your interest in the Company Stock Fund tendered may not exceed 100%, but it may be less than 100%. If this amount is less than 100%, you will be deemed to have instructed T. Rowe Price NOT to tender the balance of the shares attributable to your individual account under the Savings Plan. 4 5 (2) Date and sign the Direction Form in the space provided. (3) Return the Direction Form in the enclosed return envelope so that it is received by T. Rowe Price at the address on the return envelope not later than 12:00 Midnight, New York City time, on Monday, November 18, 1996, unless extended. Please complete and return the Direction Form even if you decide not to participate in the Offer. NO FACSIMILE TRANSMITTALS OF THE DIRECTION FORM WILL BE ACCEPTED. Your direction will be deemed irrevocable unless withdrawn by 12:00 Midnight, New York City time, on Monday, November 18, 1996, unless extended. In order to make an effective withdrawal, you must submit a new Direction Form which may be obtained by calling T. Rowe Price at 1 (800) 922-9945. Your new Direction Form must include your name, address and Social Security number. Upon receipt of a new, completed and signed Direction Form, your previous direction will be deemed cancelled. You may direct the re-tendering of any Shares attributable to your individual account by obtaining an additional Direction Form from T. Rowe Price and repeating the previous instructions for directing tenders as set forth in this letter. INVESTMENT OF TENDER PROCEEDS For any Shares attributable to your individual account under the Savings Plan that are tendered and purchased by the Company, the Company will pay cash to the Savings Plan. In accordance with the Trust Agreement, T. Rowe Price will invest the proceeds in the T. Rowe Price Prime Reserve Account as soon as administratively possible and will credit such investment to your individual account. You may call T. Rowe Price at 1 (800) 922-9945 after the reinvestment is complete to have the proceeds of the sale of Shares which were invested in the T. Rowe Price Prime Reserve Account invested in other investment options offered under the Savings Plan. INDIVIDUAL PARTICIPANTS IN THE SAVINGS PLAN WILL NOT RECEIVE ANY PORTION OF THE TENDER PROCEEDS DIRECTLY. ALL SUCH PROCEEDS WILL REMAIN IN THE SAVINGS PLAN AND MAY BE WITHDRAWN ONLY IN ACCORDANCE WITH THE TERMS OF THE SAVINGS PLAN. For federal income tax purposes, no gain or loss will be recognized by participants in the Savings Plan as a result of the tender or sale of Shares held in the Savings Plan. However, certain tax benefits that may otherwise be available in connection with the future withdrawal or distribution of Shares from the Savings Plan may be adversely affected if Savings Plan Shares are tendered and sold. Specifically, under current federal income tax rules, if a participant receives a distribution of Shares in kind as part of a "lump sum" withdrawal or distribution, the excess of the fair market value of the Shares on the date of such withdrawal or distribution over the cost to the Savings Plan of those Shares is excluded from the value of the withdrawal or distribution for purposes of determining the participant's federal income tax liability with respect to the withdrawal or distribution. Any excess in market value over the cost will be taxed to the extent realized when the Shares are sold as long-term capital gain. If you direct the Plan Administration Committee and T. Rowe Price to tender Shares attributable to your individual account in the Offer, you may adversely affect your ability to take advantage of this tax benefit. If you direct the Plan Administration Committee and T. Rowe Price not to tender any Shares attributable to your individual account, the cost of Shares attributable to your individual account will not be affected. SHARES OUTSIDE THE SAVINGS PLAN If you hold Shares directly, you will receive, under separate cover, tender offer materials directly from the Company, which can be used to tender such Shares directly to the Company. Those tender offer materials may not be used to direct the Plan Administration Committee and T. Rowe Price to tender or not tender the Shares attributable to your individual account under the Savings Plan. The direction to tender or not tender Shares attributable to your individual account under the Savings Plan may only be made in accordance with the procedures in this letter. 5 6 FURTHER INFORMATION If you require additional information concerning the terms and conditions of the Offer, please call Georgeson & Company, Inc., the Information Agent, at 1(800)223-2064. If you require additional information concerning the procedure to tender Shares attributable to your individual account under the Savings Plan, please contact T. Rowe Price at 1(800)922-9945. Sincerely, HANDY & HARMAN 6 7 QUESTIONS AND ANSWERS FOR SAVINGS PLAN PARTICIPANTS ABOUT THE HANDY & HARMAN TENDER OFFER Q. WHY IS THE COMPANY OFFERING THIS TENDER OFFER TO PARTICIPANTS IN THE SAVINGS PLAN? A. As a participant in the Savings Plan, you may have a proportional interest in the Company Stock Fund. Under the terms of the Savings Plan, you have the right to direct the investment of the contributions allocated to your individual accounts. The contributions invested in the Company Stock Fund represent a proportional interest in the assets of the Company Stock Fund. The Company Stock Fund is held in an individual account for you by T. Rowe Price (along with the plan's other investment funds). The Savings Plan provides that in the event of a tender offer, you may direct the Plan Administration Committee and T. Rowe Price to tender the number of shares of Company common stock that reflect your proportional interest in the Company Stock Fund. Q. IF I DECIDE TO DIRECT THE PLAN ADMINISTRATION COMMITTEE AND T. ROWE PRICE TO TENDER THE SHARES THAT REFLECT BY PROPORTIONAL INTEREST IN THE COMPANY STOCK FUND, WILL I BE ABLE TO RECEIVE THE PROCEEDS? A. No. All proceeds from any Savings Plan shares that are tendered and sold will be automatically invested by T. Rowe Price in the T. Rowe Price Prime Reserve Account. The proceeds will be part of your individual account and may not be distributed except in accordance with the applicable terms of the Savings Plan. Q. WILL I BE ABLE TO CHANGE THE INVESTMENT FUNDS IN WHICH THE PROCEEDS OF SAVINGS PLAN SHARES TENDERED ARE INVESTED? A. Yes. Proceeds from the sale of Shares held by the Savings Plan may be invested in a different manner subject to the provisions of the Savings Plan by contacting T. Rowe Price at 1(800)922-9945 after the reinvestment is complete. Q. IS THERE A FORM I HAVE TO RETURN? A. Included in this mailing is a "Direction Form." Complete and return this form even if you decide not to direct the tender of any shares. Q. WHAT IS THE DEADLINE FOR RETURNING THE DIRECTION FORM? A. The form must be received by T. Rowe Price at the address on the return envelope by 12:00 Midnight, on Monday, November 18, 1996, unless this deadline is extended. Q. WHAT IF I HAVE QUESTIONS? A. Contact T. Rowe Price at 1(800)922-9945 for information on the procedure for tendering the Shares reflecting your interest in the Company Stock Fund under the Savings Plan. Contact Georgeson & Company Inc., the information agent for the tender offer, at 1(800)223-2064 for questions on the terms and conditions of the offer. 7 8 DIRECTION FORM FOR PARTICIPANTS IN THE HANDY & HARMAN SAVINGS PLAN BEFORE COMPLETING THIS FORM, PLEASE READ CAREFULLY THE ACCOMPANYING OFFER TO PURCHASE AND ALL OTHER ENCLOSED MATERIALS. The undersigned acknowledges receipt of the letter of Handy & Harman (the "Company") and the enclosed Offer to Purchase, dated October 24, 1996, and the related Letter of Transmittal (which Offer to Purchase and Letter of Transmittal, as amended from time to time, together constitute the "Offer") in connection with the Offer by Handy & Harman to purchase up to 1,800,000 shares of its common stock, par value $1.00 per share (including the associated common stock purchase rights) (the "Shares"), at prices not greater than $20.00 nor less than $17.50 per Share, upon the terms and subject to the conditions of the Offer. A tender of Shares pursuant to the Offer will include a tender of the associated common stock purchase rights (the "Rights"). No separate consideration will be paid for such Rights. For a description of the Rights, see Section 7 of the Offer to Purchase. This will instruct the Handy & Harman Savings Plan Administrative Committee (the "Plan Administrative Committee") and T. Rowe Price Trust Company ("T. Rowe Price") to tender to the Company the number of Shares indicated below that are held by T. Rowe Price for the individual account of the undersigned in the Company Stock Fund (as defined in the Offer to Purchase) under the Handy & Harman 401(k) savings plan (the "Savings Plan"), at the price(s) per Share indicated, upon the terms and subject to the conditions of the Offer. For any Shares attributable to the individual account of the undersigned under the Savings Plan that are tendered and purchased by the Company, the Company will pay cash to the Savings Plan. In accordance with the terms of the Savings Plan, T. Rowe Price will invest the proceeds in the T. Rowe Price Prime Reserve Account as soon as administratively possible and will credit such investment to your individual account. The undersigned may call T. Rowe Price at 1(800)922-9945 after the reinvestment is complete to have the proceeds of the sale of Shares which were invested in the T. Rowe Price Prime Reserve Account invested in other investment options offered under the Savings Plan. INDIVIDUAL PARTICIPANTS IN THE SAVINGS PLAN WILL NOT RECEIVE ANY PORTION OF THE TENDER PROCEEDS DIRECTLY. ALL SUCH PROCEEDS WILL REMAIN IN THE SAVINGS PLAN AND MAY BE WITHDRAWN ONLY IN ACCORDANCE WITH THE TERMS OF THE SAVINGS PLAN. INSTRUCTIONS Carefully complete the form below, insert today's date, print your name, address and Social Security number and sign in the spaces provided. Enclose this Direction Form in the included envelope and mail it promptly. YOUR DIRECTION FORM MUST BE RECEIVED BY T. ROWE PRICE AT THE ADDRESS ON THE RETURN ENVELOPE NOT LATER THAN 12:00 MIDNIGHT, NEW YORK CITY TIME, ON MONDAY, NOVEMBER 18, 1996, UNLESS THE OFFER IS EXTENDED. PLEASE COMPLETE AND RETURN THE DIRECTION FORM EVEN IF YOU DECIDE NOT TO PARTICIPATE IN THE OFFER. Direction Forms that are not fully or properly completed, dated, and signed, or that are received after the deadline, will be disregarded, and the Shares reflecting your interest in the Company Stock Fund will not be tendered. Note that T. Rowe Price also has the right to disregard any direction that it determines cannot be carried out without violating applicable law. NONE OF THE COMPANY, ITS BOARD OF DIRECTORS, THE PLAN ADMINISTRATION COMMITTEE, T. ROWE PRICE, ITS AFFILIATES, OR ANY OTHER PARTY MAKES ANY RECOMMENDATIONS AS TO WHETHER TO DIRECT THE TENDER OF SHARES, THE PRICE AT WHICH TO TENDER, OR WHETHER TO REFRAIN FROM DIRECTING THE TENDER OF SHARES. EACH PARTICIPANT MUST MAKE HIS OR HER OWN DECISION ON THESE MATTERS. 9 (CHECK ONLY ONE BOX) / / 1. Please refrain from tendering and continue to HOLD all Shares reflecting my interest in the Company Stock Fund. / / 2. Please TENDER Shares reflecting my interest in the Company Stock Fund either (i) in the percentage indicated below for each of the prices provided, or (ii) if available, as set forth below under "Odd Lots." The total of the percentages may NOT exceed 100%, but it may be less than or equal to 100%. If the total of the percentages is less than 100%, T. Rowe Price will NOT tender the balance of the Shares reflecting my interest in the Company Stock Fund. A blank space before a given price will be taken to mean that no Shares reflecting my interest in the Company Stock Fund are to be tendered at that price. FILL IN THE TABLE BELOW ONLY IF YOU HAVE CHECKED BOX 2. DO NOT FILL IN THE TABLE BELOW IF YOU ARE TENDERING YOUR SHARES UNDER THE "ODD LOTS" SECTION, BELOW. IF SHARES ARE BEING TENDERED AT MORE THAN ONE PRICE, STATE THE PERCENTAGE OF SHARES TO BE SOLD AT EACH PRICE BY FILLING IN THE PERCENTAGE OF SUCH SHARES ON THE LINE IMMEDIATELY BEFORE THE PRICE. PRICE (IN DOLLARS) PER SHARE AT WHICH SHARES ARE BEING TENDERED -----% at $17.50 -----% at $18.25 -----% at $19.00 -----% at $19.75 -----% at $17.75 -----% at $18.50 -----% at $19.25 -----% at $20.00 -----% at $18.00 -----% at $18.75 -----% at $19.50
ODD LOTS This section is to be completed ONLY if (i) you have checked box 2, above, (ii) you are tendering all of the Shares attributable to your individual account under the Savings Plan, and (iii) your individual account was credited with, as of the close of business on October 23, 1996, and continues to be credited with as of the Expiration Date, an aggregate of fewer than 100 Shares. / / Please TENDER all of the Shares reflecting my interest in the Company Stock Fund at the price set forth below: PRICE (IN DOLLARS) PER SHARE AT WHICH ALL ODD LOT SHARES ARE BEING TENDERED CHECK ONLY ONE BOX. IF MORE THAN ONE BOX IS CHECKED, OR IF NO BOX IS CHECKED (EXCEPT AS PROVIDED BELOW), THERE IS NO VALID TENDER OF ODD LOT SHARES HEREUNDER. / / $17.50 / / $18.00 / / $18.50 / / $19.00 / / $19.50 / / $20.00 / / $17.75 / / $18.25 / / $18.75 / / $19.25 / / $19.75
If you do not wish to specify a purchase price, check the following box, in which case you will be deemed to have tendered at the Purchase Price determined by the Company in accordance with the terms of the Offer (persons checking this box need not indicate the price per Share in the table entitled "Price (In Dollars) Per Share At Which All Odd Lot Shares Are Being Tendered" above. / / 10 RETURN THIS DIRECTION FORM IN THE ENCLOSED RETURN ENVELOPE SO THAT IT IS RECEIVED AT THE ADDRESS ON THE RETURN ENVELOPE NOT LATER THAN 12:00 MIDNIGHT, NEW YORK CITY TIME, ON MONDAY, NOVEMBER 18, 1996, UNLESS EXTENDED. Please complete and return this Direction Form even if you decide not to participate in the Offer. NO FACSIMILE TRANSMITTALS OF THE DIRECTION FORM WILL BE ACCEPTED. SIGN HERE: Dated: __________, 1996 Name: (please print) Address: Social Security or Taxpayer ID No. EX-99.A8 9 PRESS RELEASE 1 FROM: ON BEHALF OF: Robert W. Bloch International Handy & Harman 30 East 60th Street New York, NY 10022 Contact: Stephen B. Mudd Vice President and Treasurer 212 755 8047 212 309 0666 FOR IMMEDIATE RELEASE: HANDY & HARMAN ANNOUNCES "DUTCH AUCTION" SELF-TENDER OFFER TO REPURCHASE UP TO 1.8 MILLION SHARES New York, NY--October 22, 1996. Handy & Harman (NYSE: HNH) announced today that its Board of Directors has approved the making of a "Dutch Auction" self-tender offer for 1.8 million shares of its common stock (or approximately 13% of its outstanding shares). The offer will commence on October 24, 1996 and will expire at midnight, New York city time, on the 20th business day after commencement of the offer, unless the offer is extended. Under the terms of the offer, the Company will invite shareholders to tender shares at prices between $17.50 and $20.00 per share. Based upon the number of shares tendered and the prices specified by the tendering shareholders, the Company will determine the single per share price within that price range that will allow the Company to purchase 1.8 million shares or such lesser number of shares as are properly tendered. The Company expects to fund the offer from cash on hand, sales of precious metals inventory and the Company's existing long term credit facilities. Handy & Harman's common stock price closed at $17.375 on the New York Stock Exchange on October 21, 1996. Richard N. Daniel, Chairman and Chief Executive Officer of the Company, said, "We regard the repurchase of our shares as an attractive investment, and it is consistent with our long term goal of increasing shareholder value. Even after the repurchase, Handy & Harman will have adequate cash or cash equivalents and borrowing capacity to fund internal growth opportunities and pursue acquisitions that might become available." J.P. Morgan will act as Dealer Manager and Georgeson & Company Inc. will act as Information Agent for the offer. Handy & Harman is a diversified manufacturer providing engineered products, system components and precious metal fabrication for industry worldwide. Founded in 1867, the Company is headquartered in New York. # # # EX-99.A9 10 FORM OF SUMMARY ADVERTISEMENT 1 This announcement is neither an offer to purchase nor a solicitation of an offer to sell Shares. The Offer is made solely by the Offer to Purchase and the related Letter of Transmittal. The Offer is not being made to, nor will the Company accept tenders from, holders of Shares in any jurisdiction in which the Offer or its acceptance would violate that jurisdiction's laws. The Company is not aware of any jurisdiction in which the making of the Offer or the tender of Shares would not be in compliance with the laws of such jurisdiction. In jurisdictions whose laws require that the Offer be made by a licensed broker or dealer, the Offer shall be deemed to be made on the Company's behalf by J.P. Morgan Securities Inc., or by one or more registered brokers or dealers licensed under the laws of such jurisdiction. Notice of Offer to Purchase for Cash by Handy & Harman Up to 1,800,000 Shares of its Common Stock (Including the Associated Common Stock Purchase Rights) At a Purchase Price Not Greater Than $20.00 Nor Less Than $17.50 Per Share Handy & Harman, a New York corporation (the "Company"), invites its shareholders to tender up to 1,800,000 shares of its common stock and the associated common stock purchase rights (collectively, the "Shares") to the Company at prices not greater than $20.00 nor less than $17.50 per Share in cash, specified by tendering shareholders, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated October 24, 1996 (the "Offer to Purchase"), and the related Letter of Transmittal (which, as amended from time to time, together constitute the "Offer"). THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY, NOVEMBER 21, 1996, UNLESS THE OFFER IS EXTENDED. The Offer is not conditioned on any minimum number of Shares being tendered. The Offer is, however, subject to certain other conditions set forth in the Offer to Purchase. The Board of Directors of the Company has unanimously approved the making of the Offer. However, shareholders must make their own decisions whether to tender Shares and, if so, how many Shares to tender and the price or prices at which Shares should be tendered. Neither the Company nor its Board of Directors makes any recommendation to any shareholder as to whether to tender or refrain from tendering Shares. The Company has been advised that none of its directors or executive officers intends to tender any Shares pursuant to the Offer. The Company will, upon the terms and subject to the conditions of the Offer, determine a single per Share price (not greater than $20.00 nor less than $17.50 per Share), net to the seller in cash (the "Purchase Price"), that it will pay for Shares validly tendered and not withdrawn pursuant to the Offer, taking into account the number of Shares so tendered and the prices specified by tendering shareholders. The Company will select the lowest Purchase Price that will allow it to buy 1,800,000 Shares (or such lesser number of Shares as are validly tendered at prices not greater than $20.00 nor less than $17.50 per Share) validly tendered and not withdrawn pursuant to the Offer. The Company will pay the Purchase Price for all Shares validly tendered prior to the Expiration Date (as defined below) at prices at or below the Purchase Price and not withdrawn, upon the terms and subject to the conditions of the Offer including the proration terms described below. The term "Expiration Date" means 12:00 Midnight, New York City time, on Thursday, November 21, 1996, unless and until the Company in its sole discretion shall have extended the period of time during which the Offer is open, in which event the term "Expiration Date" shall refer to the latest time and date at which the Offer, as so extended by the Company, shall expire. The Company reserves the right, in its sole discretion, to purchase more than 1,800,000 Shares pursuant to the Offer. For purposes of the Offer, the Company will be deemed to have accepted for payment (and therefore purchased), subject to proration, Shares that are validly tendered at or below the Purchase Price and not withdrawn when, as and if it gives oral or written notice to ChaseMellon Shareholder Services, L.L.C. (the "Depositary"), of its acceptance of such Shares for payment pursuant to the Offer. In all cases, payment for Shares tendered and accepted for payment pursuant to the Offer will be made promptly (subject to possible delay in the event of proration) but only after timely receipt by the Depositary of certificates for such Shares (or a timely confirmation of a book-entry transfer of such Shares into the Depositary's account at one of the Book-Entry Transfer Facilities (as defined in the Offer to Purchase)), a properly completed and duly executed Letter of Transmittal (or manually signed facsimile thereof) and any other required documents. Upon the terms and subject to the conditions of the Offer, in the event that more than 1,800,000 Shares (or such greater number of Shares as the Company may elect to purchase pursuant to the Offer) are validly tendered at or below the Purchase Price and not withdrawn, the Company will purchase such validly tendered Shares in the following order of priority: (i) all Shares validly tendered at or below the Purchase Price and not withdrawn prior to the Expiration Date by any Odd Lot Owner (as defined in the Offer to Purchase) who tenders all such Shares (including Shares reflecting interests in the Company Stock Fund (as defined in the Offer to Purchase) allocated to the Savings Plan (as defined in the Offer to Purchase) but excluding Restricted Shares (as defined in the Offer to Purchase)) beneficially owned by such Odd Lot Owner at or below the Purchase Price (partial tenders will not qualify for this preference) and who completes the box captioned "Odd Lots" on the Letter of Transmittal and, if applicable, on the Notice of Guaranteed Delivery, and (ii) after purchase of all of the foregoing Shares, all other Shares validly tendered at or below the Purchase Price prior to the Expiration Date on a pro rata basis. The Company's Board of Directors believes that, given the Company's businesses, assets and prospects, the purchase of Shares pursuant to the Offer is an attractive investment that will benefit the Company and its remaining shareholders. The Company is making the Offer to use the Company's cash and proceeds realized upon the sale of a portion of the Company's precious metals inventory to improve the Company's capital structure and lower its cost of capital for the benefit of its shareholders, and to afford to those shareholders who desire liquidity an opportunity to sell all or a portion of their Shares without the usual transaction costs associated with open market sales. After the Offer is completed, the Company expects to have sufficient cash flow and access to other sources of capital to fund its growth initiatives, including building its businesses and making strategic acquisitions. The Company expressly reserves the right, at any time or from time to time, in its sole discretion, to extend the period of time during which the Offer is open by giving notice of such extension to the Depositary and making a public announcement thereof. Subject to certain conditions set forth in the Offer to Purchase, the Company also expressly reserves the right to terminate the Offer and not accept for payment any Shares not theretofore accepted for payment. Shares tendered pursuant to the Offer may be withdrawn at any time before the Expiration Date and, unless accepted for payment by the Company as provided in the Offer to Purchase, may also be withdrawn after 12:00 Midnight, New York City time, on Friday, December 20, 1996. For a withdrawal to be effective, the Depositary must receive a notice of withdrawal in written, telegraphic or facsimile transmission form in a timely manner. Such notice of withdrawal must specify the name of the person who tendered the Shares to be withdrawn, the number of Shares tendered, the number of Shares to be withdrawn and the name of the registered holder, if different from that of the person who tendered such Shares. If the certificates have been delivered or otherwise identified to the Depositary, then, prior to the release of such certificates, the tendering shareholder must also submit the serial numbers shown on the particular certificates evidencing the Shares and the signature on the notice of withdrawal must be guaranteed by an Eligible Institution (as defined in the Offer to Purchase) (except in the case of Shares tendered by an Eligible Institution). If Shares have been tendered pursuant to the procedure for book-entry transfer, the notice of withdrawal must specify the name and the number of the account at the applicable Book-Entry Transfer Facility to be credited with the withdrawn Shares and otherwise comply with the procedures of such facility. The Offer to Purchase and the Letter of Transmittal contain important information which should be read carefully before shareholders decide whether to accept or reject the Offer and, if accepted, at what price or prices to tender their shares. These materials are being mailed to record holders of Shares and are being furnished to brokers, banks and similar persons whose names, or the names of whose nominees, appear on the Company's shareholder list (or, if applicable, who are listed as participants in a clearing agency's security position listing) for transmittal to beneficial holders of Shares. The information required to be disclosed by Rule 13e-4(d)(1) under the Securities Exchange Act of 1934, as amended, is contained in the Offer to Purchase and is incorporated by reference herein. Additional copies of the Offer to Purchase and the Letter of Transmittal may be obtained from the Information Agent and will be furnished at the Company's expense. Questions and requests for assistance may be directed to the Information Agent or the Dealer Manager as set forth below: The Information Agent for the Offer is: [Georgeson & Company logo] Wall Street Plaza New York, New York 10005 Banks and Brokers Call Collect: (212) 440-9800 All Others Call Toll Free: (800) 223-2064 The Dealer Manager for the Offer is: J.P. Morgan & Co. 60 Wall Street Mail Stop 28MA New York, New York 10260 (800) 576-9843 (toll free) (212) 648-7833 October 24, 1996 EX-99.A10 11 GUIDLINES FOR CERT OF TAXPAYER ID # 1 GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE PAYER. Social Security numbers have nine digits separated by two hyphens: i.e. 000-00-0000. Employer identification numbers have nine digits separated by only one hyphen: i.e. 00-0000000. The table below will help determine the number to give the payer. - ------------------------------------------------------- GIVE THE FOR THIS TYPE OF ACCOUNT: TAXPAYER IDENTIFICATION NUMBER OF-- - ------------------------------------------------------- 1. An individual's account The individual 2. Two or more individuals The actual owner of (joint account) the account or, if combined funds, any one of the individuals(1) 3. Husband and wife (joint The actual owner of account) the account or, if joint funds, either person(1) 4. Custodian account of a minor The minor(2) (Uniform Gift to Minors Act) 5. Adult and minor (joint The adult or, if the account) minor is the only contributor, the minor(1) 6. Account in the name of The ward, minor, or guardian or committee for a incompetent designated ward, minor, or person(3) incompetent person 7. a. The usual revocable The grantor- savings trust account trustee(1) (grantor is also trustee) b. So-called trust account The actual owner(1) that is not a legal or valid trust under State law 8. Sole proprietorship account The owner(4) - ------------------------------------------------------- - ------------------------------------------------------- GIVE THE TAXPAYER FOR THIS TYPE OF ACCOUNT: IDENTIFICATION NUMBER OF-- - ------------------------------------------------------- 9. A valid trust, estate, or The legal entity (Do pension trust not furnish the identifying number of the personal representative or trustee unless the legal entity itself is not designated in the account title.)(5) 10. Corporate account The corporation 11. Religious, charitable, or The organization educational organization account 12. Partnership account held in The partnership the name of the business 13. Association, club, or other The organization tax-exempt organization 14. A broker or registered The broker or nominee nominee 15. Account with the Department The public entity of Agriculture in the name of a public entity (such as a State or local government, school district, or prison) that receives agricultural program payments - -------------------------------------------------------
(1) List first and circle the name of the person whose number you furnish. (2) Circle the minor's name and furnish the minor's social security number. (3) Circle the ward's, minor's or incompetent person's name and furnish such person's social security number. (4) Show the name of the owner. (5) List first and circle the name of the legal trust, estate, or pension trust. NOTE: If no name is circled when there is more than one name, the number will be considered to be that of the first name listed. 2 GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 PAGE 2 OBTAINING A NUMBER If you do not have a taxpayer identification number or you do not know your number, obtain Form SS-5, Application for a Social Security Number Card, or Form SS-4, Application for Employer Identification Number, at the local office of the Social Security Administration or the Internal Revenue Service and apply for a number. PAYEES EXEMPT FROM BACKUP WITHHOLDING Payees specifically exempted from backup withholding on ALL payments include the following: - - A corporation. - - A financial institution. - - An organization exempt from tax under section 501(a), or an individual retirement plan. - - The United States or any agency or instrumentality thereof. - - A State, the District of Columbia, a possession of the United States, or any subdivision or instrumentality thereof. - - A foreign government, a political subdivision of a foreign government, or any agency or instrumentality thereof. - - An international organization or any agency, or instrumentality thereof. - - A registered dealer in securities or commodities registered in the U.S. or a possession of the U.S. - - A real estate investment trust. - - A common trust fund operated by a bank under section 584(a). - - An exempt charitable remainder trust, or a non-exempt trust described in section 4947(a)(1). - - An entity registered at all times under the Investment Company Act of 1940. - - A foreign central bank of issue. Payments of dividends and patronage dividends not generally subject to backup withholding include the following: - - Payments to nonresident aliens subject to withholding under section 1441. - - Payments to partnerships not engaged in a trade or business in the U.S. and which have at least one nonresident partner. - - Payments of patronage dividends where the amount received is not paid in money. - - Payments made by certain foreign organizations. - - Payments made to a nominee. Payments of interest generally subject to backup withholding include the following: - - Payments of interest on obligations issued by individuals. Note: You may be subject to backup withholding if this interest is $600 or more and is paid in the course of the payer's trade or business and you have not provided your correct taxpayer identification number to the payer. - - Payments of tax-exempt interest (including exempt-interest dividends under section 852). - - Payments described in section 6049(b)(5) to nonresident aliens. - - Payments on tax-free covenant bonds under section 1451. - - Payments made by certain foreign organizations. - - Payments made to a nominee. Exempt payees described above should file Form W-9 to avoid possible erroneous backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM, AND RETURN IT TO THE PAYER. IF THE PAYMENTS ARE INTEREST, DIVIDENDS, OR PATRONAGE DIVIDENDS, ALSO SIGN AND DATE THE FORM. Certain payments other than interest, dividends, and patronage dividends, that are not subject to information reporting are also not subject to backup withholding. For details, see the regulations under sections 6041, 6041A(a), 6045, and 6050A. PRIVACY ACT NOTICE. -- Section 6109 requires most recipients of dividend, interest, or other payments to give taxpayer identification numbers to payers who must report the payments to the IRS. The IRS uses the numbers for identification purposes. Payers must be given the numbers whether or not recipients are required to file a tax return. Payers must generally withhold 31% of taxable interest, dividend, and certain other payments to a payee who does not furnish a taxpayer identification number to a payer. Certain penalties may also apply. PENALTIES (1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER. -- If you fail to furnish your taxpayer identification number to a payer, you are subject to a penalty of $50 for each such failure unless your failure is due to reasonable cause and not to willful neglect. (2) FAILURE TO REPORT CERTAIN DIVIDEND AND INTEREST PAYMENTS. -- If you fail to include any portion of an includible payment for interest, dividends, or patronage dividends in gross income, such failure will be treated as being due to negligence and will be subject to a penalty of 20% on any portion of an underpayment attributable to that failure unless there is clear and convincing evidence to the contrary. (3) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING. -- If you make a false statement with no reasonable basis which results in no imposition of backup withholding, you are subject to a penalty of $500. (4) CRIMINAL PENALTY FOR FALSIFYING INFORMATION. -- Falsifying certifications or affirmations may subject you to criminal penalties including fines and/or imprisonment. FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE SERVICE. EX-99.B2 12 AMENDMENT 1 TO CREDIT AGREEMENT 1 Exhibit (b)(2) [EXECUTION COPY] FIRST AMENDMENT TO REVOLVING CREDIT AGREEMENT This FIRST AMENDMENT TO REVOLVING CREDIT AGREEMENT, dated as of June 30, 1995 (this "Amendatory Agreement"), among HANDY & HARMAN, a New York corporation ("the Borrower"), certain financial institutions signatories hereto, THE BANK OF NOVA SCOTIA, CHEMICAL BANK and THE BANK OF NEW YORK, as the co-agents (collectively referred to herein as the "Co-Agents") and THE BANK OF NOVA SCOTIA, as administrative agent (the "Administrative Agent"). W I T N E S S E T H: WHEREAS, the Borrower, the Lenders (as defined below), the Co-Agents and the Administrative Agent are parties to a Revolving Credit Agreement, dated as of September 28, 1994 (as amended or otherwise modified to the date hereof, the "Existing Credit Agreement"); and WHEREAS, the parties hereto have agreed, subject to the conditions and terms hereinafter set forth, to amend the Existing Credit Agreement in certain respects as herein provided (the Existing Credit Agreement, as so amended by this Amendatory Agreement, being referred to as the "Credit Agreement"); NOW, THEREFORE, in consideration of the agreements herein contained, the parties hereto agree as follows: PART I DEFINITIONS SUBPART 1.1. Certain Definitions. The following terms (whether or not underscored) when used in this Amendatory Agreement shall have the following meanings (such meanings to be equally applicable to the singular and plural form thereof): "Administrative Agent" is defined in the preamble. "Amendatory Agreement" is defined in the preamble. "Borrower" is defined in the preamble. "Co-Agents" is defined in the preamble. "Credit Agreement" is defined in the second recital. "Existing Credit Agreement" is defined in the first recital. "First Amendment Effective Date" is defined in Subpart 3.1. 2 SUBPART 1.2. Other Definitions. Terms for which meanings are provided in the Existing Credit Agreement are, unless otherwise defined herein or the context otherwise requires, used in this Amendatory Agreement with such meanings. PART II AMENDMENTS TO THE EXISTING CREDIT AGREEMENT Effective on (and subject to the occurrence of) the First Amendment Effective Date, the Existing Credit Agreement is hereby amended in accordance with this Part II; except as so amended, the Existing Credit Agreement shall continue in full force and effect. SUBPART 2.1. Amendment to Article I. Article I of the Existing Credit Agreement is hereby amended in accordance with Subparts 2.1.1 through 2.1.2. SUBPART 2.1.1. Section 1.1 of the Existing Credit Agreement is hereby amended by inserting the following definition in such Section in the appropriate alphabetical sequence: "First Amendment" means the First Amendment, dated as of June 30, 1995, to this Agreement among the Borrower, the Lenders party thereto, the Co-Agents and the Administrative Agent. SUBPART 2.1.2. Section 1.1 of the Existing Credit Agreement is further amended as follows: (a) the definition of "Interest Coverage Ratio" appearing in such Section is hereby amended in its entirety to read as follows: "`Interest Coverage Ratio' means, at the close of any Fiscal Quarter, the ratio, computed for the period consisting of such Fiscal Quarter and each of the three immediately preceding Fiscal Quarters, of (a) EBIT to (b) Interest Expense; provided, that the calculation of the Interest Coverage Ratio from and after the First Amendment Effective Date shall -2- 3 exclude the effects of the non-recurring, pre-tax charges in an aggregate amount not to exceed $9,500,000 relating to Borrower's discontinuance of its karat gold fabricating product line in East Providence, Rhode Island and additional costs primarily related to that division's ongoing operation in Fairfield, Connecticut." PART III CONDITIONS TO EFFECTIVENESS SUBPART 3.1. First Amendment Effective Date. This Amendatory Agreement shall become effective as of the date first set forth above (the "First Amendment Effective Date") when each of the conditions set forth in this Subpart 3.1 shall have been satisfied. SUBPART 3.1.1. Execution of Counterparts. The Administrative Agent shall have received counterparts of this Amendatory Agreement, duly executed on behalf of the Borrower and the Required Lenders. SUBPART 3.1.2. Legal Details, etc. All documents executed or submitted pursuant hereto shall be satisfactory in form and substance to the Administrative Agent and its counsel. The Administrative Agent and its counsel shall have received all information and such counterpart originals or such certified or other copies or such materials, as the Administrative Agent or its counsel may reasonably request, and all legal matters incident to the transactions contemplated by this Amendatory Agreement shall be satisfactory to the Administrative Agent and its counsel. PART IV MISCELLANEOUS SUBPART 4.1. Cross-References. References in this Amendatory Agreement to any Part or Subpart are, unless otherwise specified or otherwise required by the context, to such Part or Subpart of this Amendatory Agreement. SUBPART 4.2. Loan Document Pursuant to Existing Credit Agreement. This Amendatory Agreement is a Loan Document executed pursuant to the Existing Credit Agreement and shall be construed, administered and applied in accordance with all of the terms and provisions of the Existing Credit Agreement. -3- 4 SUBPART 4.3. Successors and Assigns. This Amendatory Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. SUBPART 4.4. Counterparts. This Amendatory Agreement may be executed by the parties hereto in several counterparts, each of which when executed and delivered shall be deemed to be an original and all of which shall constitute together but one and the same agreement. SUBPART 4.5. Representations, No Default, etc. As of the date of effectiveness of this Amendatory Agreement, the Borrower hereby represents and warrants that (a) the representations and warranties set forth in Article VI of the Existing Credit Agreement (excluding, however, those contained in Section 6.7 thereof) are true and correct in all material respects (unless stated to relate solely to an earlier date, in which case such representations and warranties were true and correct as of such earlier date); (b) except as disclosed by the Borrower to the Administrative Agent and the Lenders pursuant to Section 6.7 of the Existing Credit Agreement, (i) no litigation, arbitration or governmental investigation or proceeding is pending or, to the knowledge of the Borrower, threatened against the Borrower or any of its Subsidiaries which may reasonably be expected to materially adversely affect the Borrower's, or the Borrower and its Subsidiaries' taken as a whole, financial condition, operations, assets, businesses, properties or prospects or which purports to affect the legality, validity or enforceability of the Existing Credit Agreement, the Notes or any other Loan Document; and (ii) no development has occurred in any litigation, arbitration or governmental investigation or proceeding disclosed pursuant to Section 6.7 of the Existing Credit Agreement which may reasonably be expected to materially adversely affect the financial condition, operations, assets, businesses, properties or prospects of the Borrower or the Borrower and its Subsidiaries, taken as a whole; and (c) after giving effect to this Amendatory Agreement, no Default has occurred and is continuing. SUBPART 4.6. Limited Waiver, etc. No amendment, waiver or approval by the Issuer or any Lender under this Amendatory -4- 5 Agreement shall, except as may be otherwise stated in this Amendatory Agreement, be applicable to subsequent transactions. No waiver or approval hereunder shall require any similar or dissimilar waiver or approval to be granted after the date hereof, and except as expressly modified by this Amendatory Agreement, the provisions of the Existing Credit Agreement shall remain in full force and effect, without amendment or other modification. SUBPART 4.7. Governing Law. THIS AMENDATORY AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK. -5- 6 IN WITNESS WHEREOF, the parties hereto have caused this Amendatory Agreement to be executed by their respective authorized officers as of the day and year first above written. HANDY & HARMAN By______________________________________ Title: THE BANK OF NOVA SCOTIA, in its capacity as Administrative Agent, Co-Agent and Lender By______________________________________ Title: THE BANK OF NEW YORK, in its capacity as Co-Agent and Lender By______________________________________ Title: CHEMICAL BANK, in its capacity as Co-Agent and Lender By______________________________________ Title: -6- 7 FLEET BANK, N.A. By______________________________________ Title: NBD BANK By______________________________________ Title: THE BANK OF TOKYO TRUST COMPANY By______________________________________ Title: LTCB TRUST COMPANY By______________________________________ Title: SHAWMUT BANK, N.A. By______________________________________ Title: CREDIT LYONNAIS NEW YORK BRANCH By______________________________________ Title: CREDIT LYONNAIS CAYMAN ISLAND BRANCH By______________________________________ Title: -7- 8 THE DAIWA BANK, LIMITED By______________________________________ Title: By______________________________________ Title: DEUTSCHE BANK AG, NEW YORK AND/OR CAYMAN ISLANDS BRANCHES By______________________________________ Title: By______________________________________ Title: THE FUJI BANK, LIMITED, NEW YORK BRANCH By______________________________________ Title: NATWEST BANK N.A. By______________________________________ Title: ABN AMRO BANK N.V. NEW YORK BRANCH By______________________________________ Title: By______________________________________ Title: -8- 9 BANQUE PARIBAS By______________________________________ Title: By______________________________________ Title: GIROCREDIT BANK AG DER SPARKESSEN GRAND CAYMAN ISLAND BRANCH By______________________________________ Title: By______________________________________ Title: COMERICA BANK By______________________________________ Title: IBJ SCHRODER BANK & TRUST COMPANY By______________________________________ Title: THE MITSUBISHI BANK, LIMITED - NEW YORK BRANCH By______________________________________ Title: YASUDA TRUST & BANKING CO., LTD. NEW YORK BRANCH By______________________________________ Title: -9- EX-99.B3 13 AMENDMENT 2 TO CREDIT AGREEMENT 1 Exhibit (b)(3) [EXECUTION COPY] SECOND AMENDMENT TO REVOLVING CREDIT AGREEMENT This SECOND AMENDMENT TO REVOLVING CREDIT AGREEMENT, dated as of September 24, 1996 (this "Amendatory Agreement"), is among HANDY & HARMAN, a New York corporation (the "Borrower"), certain financial institutions signatories hereto (the "Lenders"), THE BANK OF NOVA SCOTIA, THE CHASE MANHATTAN BANK (formerly known as Chemical Bank) and THE BANK OF NEW YORK, as the co-agents (collectively referred to herein as the "Co-Agents") and THE BANK OF NOVA SCOTIA, as administrative agent (the "Administrative Agent"). W I T N E S S E T H: WHEREAS, the Borrower, the Lenders, the Co-Agents and the Administrative Agent are parties to a Revolving Credit Agreement, dated as of September 28, 1994 (as amended or otherwise modified to the date hereof, the "Existing Credit Agreement"); and WHEREAS, the parties hereto have agreed, subject to the conditions and terms hereinafter set forth, to amend the Existing Credit Agreement in certain respects as herein provided (the Existing Credit Agreement, as so amended by this Amendatory Agreement, being referred to as the "Credit Agreement"); NOW, THEREFORE, in consideration of the agreements herein contained, the parties hereto agree as follows: PART I DEFINITIONS SUBPART 1.1. Certain Definitions. The following terms (whether or not underscored) when used in this Amendatory Agreement shall have the following meanings (such meanings to be equally applicable to the singular and plural form thereof): "Administrative Agent" is defined in the preamble. "Amendatory Agreement" is defined in the preamble. "Borrower" is defined in the preamble. "Co-Agents" is defined in the preamble. "Credit Agreement" is defined in the second recital. "Existing Credit Agreement" is defined in the first recital. "Lenders" is defined in the preamble. 2 "Second Amendment Effective Date" is defined in Subpart 4.1. SUBPART 1.2. Other Definitions. Terms for which meanings are provided in the Existing Credit Agreement are, unless otherwise defined herein or the context otherwise requires, used in this Amendatory Agreement with such meanings. PART II AMENDMENTS TO THE EXISTING CREDIT AGREEMENT AND EXTENSION OF STATED MATURITY DATE Effective on (and subject to the occurrence of) the Second Amendment Effective Date, the Existing Credit Agreement is hereby amended and the Stated Maturity Date is hereby extended in accordance with this Part II; except as so amended, the Existing Credit Agreement shall continue in full force and effect. SUBPART 2.1. Amendments to Article I. Article I of the Existing Credit Agreement is hereby amended in accordance with Subparts 2.1.1 through 2.1.2. SUBPART 2.1.1. Section 1.1 of the Existing Credit Agreement is hereby amended by inserting the following definitions in such Section in the appropriate alphabetical sequence: "Applicable Commitment Fee Margin" means the lowest per annum rate determined by reference to the Net Debt to EBITDA Ratio and EBITDA to Interest Ratio, in each case that is satisfied for each of such ratios in a given clause below and as indicated in the Compliance Certificate most recently delivered pursuant to clause (c) of Section 7.1.1, equal to: (a) 0.15% if the Net Debt to EBITDA Ratio is less than or equal to 1.75:1 and the EBITDA to Interest Ratio is greater than or equal to 5.0:1; (b) 0.20% if the Net Debt to EBITDA Ratio is less than or equal to 2.25:1 and the EBITDA to Interest Ratio is greater than or equal to 3.75:1; (c) 0.25% if the Net Debt to EBITDA Ratio is less than or equal to 2.75:1 and the EBITDA to Interest Ratio is greater than or equal to 3.00:1; and (d) 0.30% if the Net Debt to EBITDA Ratio is greater than 2.75:1 or the EBITDA to Interest Ratio is less than 3.00:1. The Net Debt to EBITDA Ratio and the EBITDA to Interest Ratio used to compute the Applicable Commitment Fee Margin -2- 3 shall be the Net Debt to EBITDA Ratio and the EBITDA to Interest Ratio, as the case may be, set forth in the Compliance Certificate most recently delivered by the Borrower to the Administrative Agent pursuant to clause (c) of Section 7.1.1; changes in the Applicable Commitment Fee Margin resulting from a change in the Net Debt to EBITDA Ratio and/or the EBITDA to Interest Ratio, as the case may be, shall become effective upon delivery by the Borrower to the Administrative Agent of a new Compliance Certificate pursuant to clause (c) of Section 7.1.1. Notwithstanding the foregoing, the Lenders acknowledge and agree that, subject to the next sentence, the Applicable Commitment Fee Margin for the period from the Second Amendment Effective Date through (but excluding) the date that the first Compliance Certificate is delivered following the Second Amendment Effective Date shall be determined by reference to level (c) above (notwithstanding the actual Net Debt to EBITDA Ratio and EBITDA to Interest Ratio for such period). If the Borrower shall fail to deliver a Compliance Certificate within the number of days after the end of any Fiscal Quarter as required pursuant to clause (c) of Section 7.1.1 (without giving effect to any grace period), the Applicable Commitment Fee Margin from and including the first day after the date on which such Compliance Certificate was required to be delivered to but not including the date the Borrower delivers to the Administrative Agent a Compliance Certificate shall conclusively equal the highest Applicable Commitment Fee Margin set forth above. "Applicable L/C Margin" means the lowest per annum rate determined by reference to the Net Debt to EBITDA Ratio and EBITDA to Interest Ratio, in each case that is satisfied for each of such ratios in a given clause below and as indicated in the Compliance Certificate most recently delivered pursuant to clause (c) of Section 7.1.1, equal to: (a) 0.40% if the Net Debt to EBITDA Ratio is less than or equal to 1.75:1 and the EBITDA to Interest Ratio is greater than or equal to 5.0:1; (b) 0.55% if the Net Debt to EBITDA Ratio is less than or equal to 2.25:1 and the EBITDA to Interest Ratio is greater than or equal to 3.75:1; (c) 0.70% if the Net Debt to EBITDA Ratio is less than or equal to 2.75:1 and the EBITDA to Interest Ratio is greater than or equal to 3.00:1; and (d) 0.95% if the Net Debt to EBITDA Ratio is greater than 2.75:1 or the EBITDA to Interest Ratio is less than 3.00:1. -3- 4 The Net Debt to EBITDA Ratio and the EBITDA to Interest Ratio used to compute the Applicable L/C Margin shall be the Net Debt to EBITDA Ratio and the EBITDA to Interest Ratio, as the case may be, set forth in the Compliance Certificate most recently delivered by the Borrower to the Administrative Agent pursuant to clause (c) of Section 7.1.1; changes in the Applicable L/C Margin resulting from a change in the Net Debt to EBITDA Ratio and/or the EBITDA to Interest Ratio, as the case may be, shall become effective upon delivery by the Borrower to the Administrative Agent of a new Compliance Certificate pursuant to clause (c) of Section 7.1.1. Notwithstanding the foregoing, the Lenders acknowledge and agree that, subject to the next sentence, the Applicable L/C Margin for the period from the Second Amendment Effective Date through (but excluding) the date that the first Compliance Certificate is delivered following the Second Amendment Effective Date shall be determined by reference to level (c) above (notwithstanding the actual Net Debt to EBITDA Ratio and EBITDA to Interest Ratio for such period). If the Borrower shall fail to deliver a Compliance Certificate within the number of days after the end of any Fiscal Quarter as required pursuant to clause (c) of Section 7.1.1 (without giving effect to any grace period), the Applicable L/C Margin from and including the first day after the date on which such Compliance Certificate was required to be delivered to but not including the date the Borrower delivers to the Administrative Agent a Compliance Certificate shall conclusively equal the highest Applicable L/C Margin set forth above. "Applicable LIBO Rate Margin" means, with respect to any Loan made or maintained as a LIBO Rate Loan, the lowest per annum rate determined by reference to the Net Debt to EBITDA Ratio and EBITDA to Interest Ratio, in each case that is satisfied for each of such ratios in a given clause below and as indicated in the Compliance Certificate most recently delivered pursuant to clause (c) of Section 7.1.1, equal to: (a) 0.45% if the Net Debt to EBITDA Ratio is less than or equal to 1.75:1 and the EBITDA to Interest Ratio is greater than or equal to 5.0:1; (b) 0.60% if the Net Debt to EBITDA Ratio is less than or equal to 2.25:1 and the EBITDA to Interest Ratio is greater than or equal to 3.75:1; (c) 0.75% if the Net Debt to EBITDA Ratio is less than or equal to 2.75:1 and the EBITDA to Interest Ratio is greater than or equal to 3.00:1; and -4- 5 (d) 1.00% if the Net Debt to EBITDA Ratio is greater than 2.75:1 or the EBITDA to Interest Ratio is less than 3.00:1. The Net Debt to EBITDA Ratio and the EBITDA to Interest Ratio used to compute the Applicable LIBO Rate Margin shall be the Net Debt to EBITDA Ratio and the EBITDA to Interest Ratio, as the case may be, set forth in the Compliance Certificate most recently delivered by the Borrower to the Administrative Agent pursuant to clause (c) of Section 7.1.1; changes in the Applicable LIBO Rate Margin resulting from a change in the Net Debt to EBITDA Ratio and/or the EBITDA to Interest Ratio, as the case may be, shall become effective upon delivery by the Borrower to the Administrative Agent of a new Compliance Certificate pursuant to clause (c) of Section 7.1.1. Notwithstanding the foregoing, the Lenders acknowledge and agree that, subject to the next sentence, the Applicable LIBO Rate Margin for the period from the Second Amendment Effective Date through (but excluding) the date that the first Compliance Certificate is delivered following the Second Amendment Effective Date shall be determined by reference to level (c) above (notwithstanding the actual Net Debt to EBITDA Ratio and EBITDA to Interest Ratio for such period). If the Borrower shall fail to deliver a Compliance Certificate within the number of days after the end of any Fiscal Quarter as required pursuant to clause (c) of Section 7.1.1 (without giving effect to any grace period), the Applicable LIBO Rate Margin from and including the first day after the date on which such Compliance Certificate was required to be delivered to but not including the date the Borrower delivers to the Administrative Agent a Compliance Certificate shall conclusively equal the highest Applicable LIBO Rate Margin set forth above. "EBITDA" means, for any period, the sum for such period of all amounts which, in accordance with GAAP, would be included on the consolidated financial statements of the Borrower and its Subsidiaries as (a) EBIT; plus (b) the amount deducted, in determining Net Income, representing amortization; plus (c) the amount deducted, in determining Net Income, representing depreciation of assets. -5- 6 "EBITDA to Interest Ratio" means, at the close of any Fiscal Quarter, the ratio, computed for the period consisting of such Fiscal Quarter and each of the three immediately preceding Fiscal Quarters, of (a) EBITDA to (b) Interest Expense. "Net Debt to EBITDA Ratio" means, at the last day of any Fiscal Quarter, the ratio, computed (in the case of clause (b) below) for the period consisting of such Fiscal Quarter and each of the three immediately preceding Fiscal Quarters, of (a) Debt minus the aggregate amount of cash and Cash Equivalent Investments (not subject to any Lien or other encumbrance) owned by the Borrower and its Subsidiaries on such last day to (b) EBITDA. "Second Amendment" means the Second Amendment, dated as of September 24, 1996, to this Agreement among the Borrower, the Lenders party thereto, the Co-Agents and the Administrative Agent. "Second Amendment Effective Date" means the Second Amendment Effective Date as defined in Subpart 4.1 of the Second Amendment. SUBPART 2.1.2. Section 1.1 of the Existing Credit Agreement is further amended by amending the definition of "Loan Commitment Amount" appearing in such Section in its entirety to read as follows: "`Loan Commitment Amount' means, on any day, $150,000,000, as such amount may be reduced from time to time pursuant to Section 2.2." SUBPART 2.2. Amendments to Article III. Article III of the Existing Credit Agreement is hereby amended in accordance with Subparts 2.2.1 and 2.2.2. SUBPART 2.2.1. Clause (ii) of Section 3.2.1 of the Existing Credit Agreement is hereby amended in its entirety to read as follows: -6- 7 "(ii) On that portion of such Borrowing maintained as LIBO Rate Loans, during each Interest Period applicable thereto, such rate shall be equal to the sum of the LIBO Rate (Reserve Adjusted) for such Interest Period plus the Applicable LIBO Rate Margin; and" SUBPART 2.2.2. Section 3.3.1 of the Existing Credit Agreement is hereby amended by deleting the words "at the rate of 3/8 of 1% per annum" and inserting the words "equal to the Applicable Commitment Fee Margin" in place thereof. SUBPART 2.2.3. Section 3.3.2 of the Existing Credit Agreement is hereby amended by (i) deleting the words "at the rate of 7/8 of 1% per annum" appearing in clause (x) of such Section and inserting the words "equal to the Applicable L/C Margin" in place thereof and (ii) deleting the words "at the rate of 1/4 of 1% per annum" appearing in clause (y) of such Section and inserting the words "at the rate of 0.1875% per annum" in place thereof. SUBPART 2.3. Amendments to Exhibits. Exhibit A-1 (Form of Revolving Note), Exhibit A-2 (Form of Competitive Bid Loan Note) and Exhibit E (Compliance Certificate) to the Existing Credit Agreement are hereby amended in their entirety to read as respectively set forth on Exhibits A, B and C hereto. SUBPART 2.4. Extension of Stated Maturity Date. By their signatures below, the parties hereto hereby agree that, in accordance with the terms of Section 2.4 of the Existing Credit Agreement, upon the effectiveness of this Amendatory Agreement, the Stated Maturity Date shall be September 27, 1999. PART III ACKNOWLEDGEMENT SUBPART 3.1. Acknowledgement. By their signature below, each of the Lenders acknowledges and agrees that, as of the Second Amendment Effective Date (and notwithstanding any reductions to the Loan Commitment Amount that have occurred prior to the Second Amendment Effective Date), the Loan Commitment Amount is $150,000,000, as such amount may be reduced from time to time pursuant to Section 2.2 of the Credit Agreement. PART IV CONDITIONS TO EFFECTIVENESS SUBPART 4.1. Second Amendment Effective Date. This Amendatory Agreement shall become effective on the date first set forth above (the "Second Amendment Effective Date") when each of -7- 8 the conditions set forth in this Subpart 4.1 shall have been satisfied. SUBPART 4.1.1. Execution of Counterparts. The Administrative Agent shall have received counterparts of this Amendatory Agreement, duly executed on behalf of the Borrower and each of the Lenders. SUBPART 4.1.2. Resolutions, etc. The Administrative Agent shall have received from the Borrower, with copies for each Lender, a certificate, dated the Second Amendment Effective Date, of its Secretary or Assistant Secretary as to (a) resolutions of its Board of Directors, then in full force and effect, authorizing the execution, delivery and performance of this Amendatory Agreement and each other Loan Document to be executed by it in connection with this Amendatory Agreement; and (b) the incumbency and signatures of its officers authorized to execute and deliver, and act with respect to, this Amendatory Agreement, each other Loan Document and each of the other documents, certificates, instruments and other agreements delivered or to be delivered by it pursuant to this Amendatory Agreement and pursuant to the Credit Agreement. Each of the Lenders and the Agents may conclusively rely upon such certificate until the Administrative Agent has received a further certificate of the Secretary or an Assistant Secretary of the Borrower cancelling or amending such prior certificate. SUBPART 4.1.3. Fees and Expenses. The Administrative Agent shall have received payment in full of (i) an amendment fee in an amount equal to $155,875 for the pro rata account of the Lenders as set forth on Schedule I and (ii) all other fees, costs and expenses due and payable as of the Second Amendment Effective Date. SECTION 4.1.4. Opinions of Counsel. The Administrative Agent shall have received opinions, dated the Second Amendment Effective Date and addressed to the Issuer, the Agents and all Lenders, from counsel to the Borrower, in form and substance satisfactory to the Adminstrative Agent. SUBPART 4.1.5. Delivery of Notes. The Administrative Agent shall have received, for the account of each Lender, Notes, issued in substitution and exchange for, and not in satisfaction of, the Notes delivered under the terms of the Existing Credit Agreement, duly executed and delivered by the Borrower. -8- 9 SUBPART 4.1.6. Legal Details, etc. All documents executed or submitted pursuant hereto shall be satisfactory in form and substance to the Administrative Agent and its counsel. The Administrative Agent and its counsel shall have received all information and such counterpart originals or such certified or other copies or such materials, as the Administrative Agent or its counsel may reasonably request, and all legal matters incident to the transactions contemplated by this Amendatory Agreement shall be satisfactory to the Administrative Agent and its counsel. PART V MISCELLANEOUS SUBPART 5.1. Cross-References. References in this Amendatory Agreement to any Part or Subpart are, unless otherwise specified or otherwise required by the context, to such Part or Subpart of this Amendatory Agreement. SUBPART 5.2. Loan Document Pursuant to Existing Credit Agreement. This Amendatory Agreement is a Loan Document executed pursuant to the Existing Credit Agreement and shall be construed, administered and applied in accordance with all of the terms and provisions of the Existing Credit Agreement. SUBPART 5.3. Successors and Assigns. This Amendatory Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. SUBPART 5.4. Counterparts. This Amendatory Agreement may be executed by the parties hereto in several counterparts, each of which when executed and delivered shall be deemed to be an original and all of which shall constitute together but one and the same agreement. SUBPART 5.5. Representations, No Default, etc. As of the date of effectiveness of this Amendatory Agreement, the Borrower hereby represents and warrants to the Agents, the Issuer and the Lenders that (a) the representations and warranties set forth in Article VI of the Existing Credit Agreement (excluding, however, those contained in Section 6.7 thereof) are true and correct in all material respects (unless stated to relate solely to an earlier date, in which case such representations and warranties were true and correct as of such earlier date); (b) except as disclosed by the Borrower to the Administrative Agent and the Lenders pursuant to Section 6.7 of the Existing Credit Agreement, -9- 10 (i) no litigation, arbitration or governmental investigation or proceeding is pending or, to the knowledge of the Borrower, threatened against the Borrower or any of its Subsidiaries which may reasonably be expected to materially adversely affect the Borrower's, or the Borrower and its Subsidiaries' taken as a whole, financial condition, operations, assets, businesses, properties or prospects or which purports to affect the legality, validity or enforceability of the Existing Credit Agreement, the Notes or any other Loan Document; and (ii) no development has occurred in any litigation, arbitration or governmental investigation or proceeding disclosed pursuant to Section 6.7 of the Existing Credit Agreement which may reasonably be expected to materially adversely affect the financial condition, operations, assets, businesses, properties or prospects of the Borrower or the Borrower and its Subsidiaries, taken as a whole; and (c) no Default has occurred and is continuing. SUBPART 5.6. Limited Waiver, etc. No amendment, waiver or approval by the Agents, the Issuer or any Lender under this Amendatory Agreement shall, except as may be otherwise stated in this Amendatory Agreement, be applicable to subsequent transactions. No amendment, waiver or approval hereunder shall require any similar or dissimilar amendment, waiver or approval to be granted after the date hereof, and except as expressly modified by this Amendatory Agreement, the provisions of the Existing Credit Agreement shall remain in full force and effect, without amendment or other modification. SUBPART 5.7. Governing Law. THIS AMENDATORY AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK. -10- 11 IN WITNESS WHEREOF, the parties hereto have caused this Amendatory Agreement to be executed by their respective authorized officers as of the day and year first above written. HANDY & HARMAN By______________________________________ Title: THE BANK OF NOVA SCOTIA, in its capacity as Administrative Agent, Co-Agent and Lender By______________________________________ Title: 12 THE BANK OF NEW YORK, in its capacity as Co-Agent and Lender By______________________________________ Title: 13 THE CHASE MANHATTAN BANK (formerly known as Chemical Bank), in its capacity as Co-Agent and Lender By______________________________________ Title: 14 FLEET PRECIOUS METALS INC. By______________________________________ Title: 15 THE FIRST NATIONAL BANK OF CHICAGO (formerly known as NBD Bank) By______________________________________ Title: 16 BANK OF TOKYO - MITSUBISHI TRUST COMPANY By______________________________________ Title: 17 LTCB TRUST COMPANY By______________________________________ Title: 18 CREDIT LYONNAIS NEW YORK BRANCH By______________________________________ Title: CREDIT LYONNAIS CAYMAN ISLAND BRANCH By______________________________________ Title: 19 THE SUMITOMO BANK, LIMITED By______________________________________ Title: By______________________________________ Title: 20 DEUTSCHE BANK AG, NEW YORK AND/OR CAYMAN ISLANDS BRANCHES By______________________________________ Title: By______________________________________ Title: 21 THE FUJI BANK, LIMITED, NEW YORK BRANCH By______________________________________ Title: 22 ABN AMRO BANK N.V. NEW YORK BRANCH By______________________________________ Title: By______________________________________ Title: 23 BANQUE PARIBAS By______________________________________ Title: By______________________________________ Title: 24 GIROCREDIT BANK AG DER SPARKESSEN GRAND CAYMAN ISLAND BRANCH By______________________________________ Title: By______________________________________ Title: 25 COMERICA BANK By______________________________________ Title: 26 IBJ SCHRODER BANK & TRUST COMPANY By______________________________________ Title: 27 YASUDA TRUST & BANKING CO., LTD. NEW YORK BRANCH By______________________________________ Title: 28 SCHEDULE I TO SECOND AMENDMENT
Allocation of Amendment Fee --------------------------- Lender Amount ------ ------ $ ---------
29 EXHIBIT A TO SECOND AMENDMENT EXHIBIT A-1 Revolving Loan Note $____________ September 28, 1994 FOR VALUE RECEIVED, the undersigned, HANDY & HARMAN, a New York corporation (the "Borrower"), promises to pay to the order of _________________________ (the "Lender") on the Stated Maturity Date (as such term is defined in the Credit Agreement referred to below), the principal sum of ______________ DOLLARS ($__________) or, if less, the aggregate unpaid principal amount of all Revolving Loans (as such term is defined in the Revolving Credit Agreement, dated as of the date hereof (as such Revolving Credit Agreement may be amended, supplemented, amended and restated or otherwise modified from time to time, the "Credit Agreement"), among the Borrower, The Bank of Nova Scotia, The Chase Manhattan Bank (formerly known as Chemical Bank) and The Bank of New York, as Co-Agents, The Bank of Nova Scotia, as Administrative Agent and certain financial institutions (including the Lender) as are, or may become, parties thereto), made by the Lender pursuant to the Credit Agreement. A notation indicating all Revolving Loans made by the Lender pursuant to the Credit Agreement and payments on account of principal of such Revolving Loans may, from time to time, be made by the holder hereof on the grid attached to this Revolving Loan Note. Unless otherwise defined herein or the context otherwise requires, terms used herein have the meanings provided in the Credit Agreement. The unpaid principal amount of this Revolving Loan Note from time to time outstanding shall bear interest as provided in Section 3.2.1 of the Credit Agreement. All payments of principal of and interest on this Revolving Loan Note shall be payable in lawful currency of the United States of America to the account designated by the Administrative Agent in same day funds. This Revolving Loan Note represents a renewal of, and is issued in substitution and exchange for, and not in satisfaction of, that certain Revolving Loan Note of the Borrower, dated September 28, 1994, payable to the order of the Lender (or its assignor). The indebtedness originally evidenced by such promissory note is a continuing Indebtedness, and nothing herein contained shall be construed to deem such promissory note paid. This Revolving Loan Note is one of the Revolving Loan Notes referred to in, and evidences indebtedness incurred in respect of 30 the Revolving Loans under, the Credit Agreement, to which reference is made for a statement of the terms and conditions on which the Borrower is permitted and required to make prepayments of principal of the indebtedness evidenced by this Revolving Loan Note and on which such indebtedness may be declared to be or may become immediately due and payable. -2- 31 THIS REVOLVING LOAN NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK, AND SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK. HANDY & HARMAN By______________________________________ Title: -3- 32 GRID ==================================================================================================================================== LAST DAY OF APPLICABLE AMOUNT OF OUTSTANDING AMOUNT OF ALTERNATE INTEREST PRINCIPAL PRINCIPAL NOTATION MADE DATE LOAN BASE RATE LIBO RATE PERIOD PAYMENT BALANCE BY - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ ====================================================================================================================================
-4- 33 EXHIBIT B TO SECOND AMENDMENT Exhibit A-2 Competitive Bid Loan Note $150,000,000 September 28, 1994 FOR VALUE RECEIVED, the undersigned, HANDY & HARMAN, a New York corporation (the "Borrower"), promises to pay to the order of _______________________ (the "Lender") on the earlier of (i) each Competitive Bid Loan Maturity Date (as such term is defined in that certain Revolving Credit Agreement, dated as of the date hereof (as such Revolving Credit Agreement may be amended, supplemented, amended and restated or otherwise modified from time to time, the "Credit Agreement"), among the Borrower, The Bank of Nova Scotia, The Chase Manhattan Bank (formerly known as Chemical Bank) and The Bank of New York, as Co-Agents, The Bank of Nova Scotia, as Administrative Agent and certain financial institutions (including the Lender) as are, or may from time to time become parties thereto), and (ii) the Commitment Termination Date (as defined in the Credit Agreement), the principal sum of ONE HUNDRED FIFTY MILLION DOLLARS ($150,000,000) or, if less, the unpaid principal amount of all Competitive Bid Loans made by the Lender to the Borrower from time to time pursuant to Section 2.4. of the Credit Agreement. A notation indicating all Competitive Bid Loans made by the Lender pursuant to the Credit Agreement and all payments on account of principal of such Competitive Bid Loans may, from time to time, be made by the holder hereof on the grid attached to this Competitive Bid Loan Note. The unpaid principal amount of this Competitive Bid Loan Note from time to time outstanding shall bear interest as provided in Section 3.2.1 of the Credit Agreement. All payments of principal of and interest on this Competitive Bid Loan Note shall be payable in lawful currency of the United States of America to the account designated by the Administrative Agent in same day funds. This Competitive Bid Loan Note represents a renewal of, and is issued in substitution and exchange for, and not in satisfaction of, that certain Competitive Bid Loan Note of the Borrower, dated September 28, 1994, payable to the order of the Lender (or its assignor). The indebtedness originally evidenced by such promissory note is a continuing indebtedness, and nothing herein contained shall be construed to deem such promissory note paid. 34 This Competitive Bid Loan Note is one of the Competitive Bid Loan Notes referred to in, and evidences indebtedness incurred in respect of Competitive Bid Loans under, the Credit Agreement, to which reference is made for a statement of the terms and conditions on which the Borrower is permitted and required to make prepayments of principal of the indebtedness evidenced by this Competitive Bid Loan Note and on which such indebtedness may be declared to be or may become immediately due and payable. Unless otherwise defined herein or the context otherwise requires, terms used herein have the meanings provided in the Credit Agreement. THIS COMPETITIVE BID LOAN NOTE HAS BEEN DELIVERED IN NEW YORK, NEW YORK AND SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK. HANDY & HARMAN By______________________________________ Title: -2- 35 GRID - ------------------------------------------------------------------------------------------------------------------------------------ COMPETITIVE BID LOAN AMOUNT OF AMOUNT OF OUTSTANDING AMOUNT MATURITY INTEREST INTEREST PRINCIPAL PRINCIPAL NOTATION DATE OF LOAN DATE PERIOD PAYMENT PAYMENT BALANCE MADE BY - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------------------
-3- 36 EXHIBIT C TO SECOND AMENDMENT Form of Compliance Certificate To: Each of the Lenders (as defined below) -and- The Bank of Nova Scotia, as Administrative Agent One Liberty Plaza New York, New York 10006 Attention: ______________ Handy & Harman Gentlemen: This Compliance Certificate is being delivered pursuant to clause (c) of Section 7.1.1 of the Revolving Credit Agreement, dated as of September 28, 1994 (as amended, supplemented, amended and restated or otherwise modified, the "Credit Agreement"), among Handy & Harman, a New York corporation (the "Borrower"), certain financial institutions now or hereafter parties thereto (the "Lenders"), The Bank of Nova Scotia, The Chase Manhattan Bank (formerly known as Chemical Bank) and The Bank of New York, as Co-Agents for the Lenders and The Bank of Nova Scotia, as Administrative Agent. Terms used herein without definition shall have the meanings assigned to such terms in Section 1.1 of the Credit Agreement. The Borrower hereby certifies, represents and warrants that as of _________ __, 19__ (the "Computation Date"): (a) The Adjusted Consolidated Tangible Net Worth was $__________, as computed on Attachment 1 hereto and such amount [complies] [does not comply] with the provisions of clause (a) of Section 7.2.4 of the Credit Agreement; (b) The Leverage Ratio was __:1.00, as computed on Attachment 2 hereto and such ratio [complies] [does not comply] with the provisions of clause (b) of Section 7.2.4 of the Credit Agreement; (c) The Interest Coverage Ratio was __:1.00, as computed on Attachment 3 hereto and such ratio [complies] [does not comply] with the provisions of clause (c) of Section 7.2.4 of the Credit Agreement; 37 (d) The Net Debt to EBITDA Ratio was __:1.00 and the EBITDA to Interest Ratio was __:1.00, as computed on Attachment 4 hereto; (e) The aggregate amount of Designated Debt of the Borrower and its Subsidiaries was $_________ as computed on Attachment 5 hereto and such amount [complies] [does not comply] with clause (a) of Section 7.2.2 of the Credit Agreement; (f) The aggregate amount of Debt of all Subsidiaries was $_________, and such amount [complies] [does not comply] with clause (b) of Section 7.2.2 of the Credit Agreement; (g) The aggregate face amount of Indebtedness in respect of letters of credit (other than Letters of Credit) was $________, and such amount [complies] [does not comply] with clause (a)(ii)(B) of Section 7.2.2 of the Credit Agreement; (h) The aggregate amount of Investments (other than the Investments permitted by clauses (a) through (f) of Section 7.2.5 of the Credit Agreement) made, incurred, assumed or otherwise existing by the Borrower and its Subsidiaries was $_________ and such amount [complies] [does not comply] with clause (g) of Section 7.2.5 of the Credit Agreement; (i) The aggregate amount of rental obligations entered into by the Borrower and its Subsidiaries of the type set forth in Section 7.2.8 of the Credit Agreement was $_________ and such amount [complies] [does not comply] with Section 7.2.8 of the Credit Agreement; (j) The aggregate book value or market value, if higher (determined as to particular assets as of the respective date of disposition thereof) (other than in accordance with clauses (a), (b) and (c) of Section 7.2.11 of the Credit Agreement) of all assets sold, transferred, leased, contributed or otherwise conveyed by the Borrower and its Subsidiaries (i) since the Effective Date was $__________ and such amount [complies] [does not comply] with clause (d)(i) of Section 7.2.11 of the Credit Agreement, and (ii) constitutes assets which contributed __% of operating profit contribution during the three most recently completed Fiscal Years of the Borrower, and such amount [complies][does not comply] with clause (d)(ii) of Section 7.2.11 of the Credit Agreement; (k) No Default has occurred and is continuing [other than as follows:]; (l) The total market value of precious metal held on consignment by the Borrower and its Subsidiaries was $__________; -2- 38 (m) The total number of ounces of precious metal held on consignment at each Plant (as defined in the Consignment Facilities) under the terms of the Consignment Facilities was ; and (n) The total number of ounces of U.S. Bullion (as defined in the Consignment Facilities) located at each Plant was ______. (o) Based on paragraph (d) above, the Applicable LIBO Rate Margin is ___%, the Applicable L/C Margin is ___% and the Applicable Commitment Fee Margin is ___%. IN WITNESS WHEREOF, the Borrower has caused this Compliance Certificate to be executed and delivered by its duly Authorized Officer on this ____ day of _________, 19__. HANDY & HARMAN By______________________________________ Title: -3- 39 ATTACHMENT 1 (to __/__/__ Compliance Certificate) ADJUSTED CONSOLIDATED TANGIBLE NET WORTH (________ __, 19__) 1. ADJUSTED CONSOLIDATED TANGIBLE NET WORTH: A. The par value (or value stated on the books of the Borrower) of the capital stock of all classes of the Borrower..................................................$_________ B. The amount of the consolidated surplus, whether capital or earned, of the Borrower and its and its Subsidiaries..................................... $_________ C. The sum (or difference, in the case of a surplus deficit in Item 1.B) of Items 1.A and 1.B........................... $_________ D. The aggregate amount of treasury stock, subscribed but unissued stock, unamortized debt discount and expense, good will, trademarks, trade names, patents and other intangible assets (but not deferred charges) of the Borrower and its Subsidiaries ............................................ $_________ E. The aggregate amount of all write- ups in the book value of any assets owned by the Borrower or its Subsidiaries subsequent to March 16, 1992, other than write-ups of assets (and assets of Subsidiaries) acquired by the Borrower and/or its Subsidiaries (exclusive of goodwill) that are made in connection with the acquisition thereof ..................................... $_________ F. Sum of Items 1.D through 1.E $_________ --------- --- G. CONSOLIDATED TANGIBLE NET WORTH: The excess of Item 1.C over Item 1.F..................... $_________ H. 40% of the excess of the Market
40 Value of the Borrower's and its Subsidiaries' owned precious metal holdings over the LIFO cost of such holdings as set forth in the Borrower's most recent consolidated financial statements delivered pursuant to clause (a) or clause (b) of Section 7.1.1 of the Credit Agreement..................................... $_________ I. ADJUSTED CONSOLIDATED TANGIBLE NET WORTH: The sum of Items 1.G and 1.H............................. $_________
-2- 41 ATTACHMENT 2 (to __/__/__ Compliance Certificate) LEVERAGE RATIO (on ___________ __, 19__) 2. (1)LEVERAGE RATIO: A. The aggregate outstanding principal and stated amount of the consolidated Indebtedness of the Borrower and its Subsidiaries for borrowed money and all other obligations evidenced by bonds, debentures, notes or other similar instruments..................................... $_________ B. The aggregate outstanding principal and stated amount of the consolidated Indebtedness of the Borrower and its Subsidiaries (without duplication of the obligations set forth in Item 2.A of this Attachment 2), whether contingent or otherwise, relative to banker's acceptances issued for the account of the Borrower and its Subsidiaries ............................................$_________ C. The aggregate outstanding principal and stated amount of the consolidated Indebtedness of the Borrower and its Subsidiaries as lessee under leases which have been or should be, in accordance with GAAP, recorded as Capitalized Lease Liabilities........................... $_________ D. Without duplication, Contingent Liabilities of the Borrower and its Subsidiaries in respect of any types of Indebtedness described in Items 2.A through 2.C .................................. $_________ E. Debt: The Sum of Items 2.A through 2.D................. $_________
- -------- 1 Computed in accordance with the final sentence contained in the definition of "Indebtedness". 42 F. Adjusted Consolidated Tangible Net Worth (from Attachment 1, Item 1.I)................. $_________ G. LEVERAGE RATIO: The ratio of Item 2.E to Item 2.F................................. ____:1.00
-2- 43 ATTACHMENT 3 (to __/__/__ Compliance Certificate) INTEREST COVERAGE RATIO (on __/__/19__) 3. INTEREST COVERAGE RATIO: *A. The consolidated net income of the Borrower and its Subsidiaries (excluding any extraordinary gains and losses)........................................ $__________ *B. The aggregate amount of interest expense of the Borrower and its Subsidiaries, including the portion of any rent paid on Capital Lease Liabilities which is allocable to interest expense in accordance with GAAP and including fees or rents arising from or relating to consignment or leasing of precious metals other than up-front fees paid on the Effective Date to the Lenders (provided, that any such interest expense which is subject to a Hedging Obligation will be calculated on the net effect of any payments made by the other party to such Hedging Obligation)........................... $__________ *C. To the extent deducted in determining Net Income, provisions for income taxes........................ $__________ D. EBIT: The sum of Items 3.A through 3.C........................................ $__________ E. Interest Expense: The amount set forth in Item 3.B above minus the effects of the nonrecurring, pre- tax charges in an aggregate amount not to exceed $9,500,000 relating to the Borrower's discontinuance of its karat gold fabricating product line
- -------- * The amount which, in accordance with GAAP, would be included on the consolidated financial statements of the Borrower and its Subsidiaries. 44 in East Providence, Rhode Island and additional costs primarily related to that division's ongoing operation in Fairfield, Connecticut.......................... $__________ F. INTEREST COVERAGE RATIO: The ratio of Item 3.D to Item 3.E............................ ____:1.00
-2- 45 ATTACHMENT 4 (to __/__/__ Compliance Certificate) NET DEBT TO EBITDA RATIO EBITDA TO INTEREST RATIO (on __/__/19__) 4. I. NET DEBT TO EBITDA RATIO: A. Debt: Item 2.E from Attachment 2..................... $__________ B. The aggregate amount of cash and Cash Equivalent Investments (not subject to any Lien or other encumbrance) owned by the Borrower and its Subsidiaries on the last day of the applicable Fiscal Quarter..................... $__________ C. Net Debt: Item 4.A minus Item 4.B................... $__________ *D. EBIT: Item 3.D from Attachment 3..................... $__________ *E. To the extent deducted in determining Net Income, provisions for depreciation of assets................ $__________ *F. To the extent deducted in determining Net Income, provisions for amortization.......................... $__________ G. EBITDA: The sum of Items 4.D through 4.F.......................................... $__________ H. NET DEBT TO EBITDA RATIO: The ratio of Item 4.C to Item 4.G.............................. ____:1.00 II. EBITDA TO INTEREST RATIO: I. EBITDA: Item 4.G above.............................. $__________ J. Interest Expense: Item 3.E.......................... $__________ K. EBITDA TO INTEREST RATIO: The ratio of Item 4.I to Item 4.J................................. ____:1.00
- -------- * The amount which, in accordance with GAAP, would be included on the consolidated financial statements of the Borrower and its Subsidiaries. 46 ATTACHMENT 5 (to __/__/__ Compliance Certificate) DESIGNATED DEBT (as of _________ __, 19__) 5. DESIGNATED DEBT: A. Current Debt: The aggregate amount of current maturities of the consolidated Debt of the Borrower and its Subsidiaries, determined in accordance with GAAP................................ $_________ B. The sum of the aggregate outstanding principal amount of all Loans plus Letter of Credit Outstandings (as such terms are defined in the Long Term Credit Agreement).............................. $_________ C. The sum of Item 5.A and Item 5.B.................... $_________ D. 90% of the Market Value of the gold, silver and platinum group metals and the gold, silver and platinum group metals' content of alloys then owned by the Borrower and its Subsidiaries in inventory and not held in consignment......................................... $_________ E. 75% of the Eligible Receivables of the Borrower and its Subsidiaries as computed on Attachment 6 hereto..................... $_________ F. The aggregate amount of cash and Cash Equivalent Investments of the Borrower and its Subsidiaries, but only to the extent that such cash and Cash Equivalent Investments are not subject to any Lien and (if held or owned by a Subsidiary) are transferable to the Borrower without the consent or approval of any other Person........................................ $_________
47 G. The sum of Items 5.D through 5.F.................... $_________ H. The excess of Item 5.C over Item 5.G................ $__________
-2- 48 ATTACHMENT 6 (to __/__/__ Compliance Certificate) ELIGIBLE RECEIVABLES (as of _________ __, 19__) 6. ELIGIBLE RECEIVABLES: A. Without duplication, the aggregate amount of Receivables of the Borrower and its Subsidiaries........................... $_________ B. The amount of such Receivables lawfully owned by the Borrower or such Subsidiary which is not free and clear of Liens (other than Liens permitted under Section 7.2.3 of the Credit Agreement)....................................... $_________ C. The amount of such Receivables which is not valid, binding and legally enforceable obligations of the obligor under such Receivable........................... $_________ D. The amount of such Receivables which is subject to any dispute, setoff, counterclaim or other claim or defense on the part of the obligor thereunder, or which is subject to any obligor denying liability under such Receivable in whole or in part..................... $_________ E. The amount of such Receivables which is not a bona fide Receivable arising from the sale (on an absolute, and not a consignment, approval, or sale-and-return- basis (subject to the terms of the parenthetical in clause (d) of the definition of "Eligible Receivable" contained in the Credit Agreement))..................... $_________ F. The amount of such Receivables which is payable more than 90 days after the shipping of goods giving rise to such Receivable, or is more than 60 days past due........................................ $_________ G. The amount of such Receivables which have been written off or reserved against........................................ $_________
49 H. The amount of such Receivables which is the obligation of an obligor that is either an Affiliate of the Borrower, or the subject of any reorganization, bankruptcy, receivership, custodianship, insolvency or like proceeding or any event of the nature set forth in clauses (a) through (d) of Section 8.1.9 of the Credit Agreement........................... $_________ I. The sum of Items 6.B through 6.H........................ $_________ J. Item 6.A minus Item 6.I................................. $_________ K. 75% of the amount of the GO/DAN Receivable.............................................. $_________ L. ELIGIBLE RECEIVABLES: Item 6.J plus Item 6.K................................................ $_________
-2- EX-99.B4 14 AMENDMENT 3 TO CREDIT AGREEMENT 1 Exhibit (b)(4) [EXECUTION COPY] THIRD AMENDMENT TO REVOLVING CREDIT AGREEMENT This THIRD AMENDMENT TO REVOLVING CREDIT AGREEMENT, dated as of October 11, 1996 (this "Amendatory Agreement"), is among HANDY & HARMAN, a New York corporation (the "Borrower"), certain financial institutions signatories hereto (the "Lenders"), THE BANK OF NOVA SCOTIA, THE CHASE MANHATTAN BANK (formerly known as Chemical Bank) and THE BANK OF NEW YORK, as the co-agents (collectively referred to herein as the "Co-Agents"), and THE BANK OF NOVA SCOTIA, as administrative agent (the "Administrative Agent"). W I T N E S S E T H: WHEREAS, the Borrower, the Lenders, the Co-Agents and the Administrative Agent are parties to a Revolving Credit Agreement, dated as of September 28, 1994 (as amended or otherwise modified to the date hereof, the "Existing Credit Agreement"); and WHEREAS, the parties hereto have agreed, subject to the conditions and terms hereinafter set forth, to amend the Existing Credit Agreement in certain respects as herein provided (the Existing Credit Agreement, as so amended by this Amendatory Agreement, being referred to as the "Credit Agreement"); NOW, THEREFORE, in consideration of the agreements herein contained, the parties hereto agree as follows: PART I DEFINITIONS SUBPART 1.1. Certain Definitions. The following terms (whether or not underscored) when used in this Amendatory Agreement shall have the following meanings (such meanings to be equally applicable to the singular and plural form thereof): "Administrative Agent" is defined in the preamble. "Amendatory Agreement" is defined in the preamble. "Borrower" is defined in the preamble. "Co-Agents" is defined in the preamble. "Credit Agreement" is defined in the second recital. "Existing Credit Agreement" is defined in the first recital. "Lenders" is defined in the preamble. 2 "Third Amendment Effective Date" is defined in Subpart 3.1. SUBPART 1.2. Other Definitions. Terms for which meanings are provided in the Existing Credit Agreement are, unless otherwise defined herein or the context otherwise requires, used in this Amendatory Agreement with such meanings. PART II AMENDMENTS TO THE EXISTING CREDIT AGREEMENT Effective on (and subject to the occurrence of) the Third Amendment Effective Date, the Existing Credit Agreement is hereby amended in accordance with this Part II; except as so amended, the Existing Credit Agreement shall continue in full force and effect. SUBPART 2.1. Amendments to Article I. Article I of the Existing Credit Agreement is hereby amended in accordance with Subparts 2.1.1 through 2.1.2. SUBPART 2.1.1. Section 1.1 of the Existing Credit Agreement is hereby amended by inserting the following definitions in such Section in the appropriate alphabetical sequence: "1996 Transaction" means the sale of gold by the Borrower on or before December 31, 1996 and certain other events, as more specifically described in the letter, dated October 2, 1996, from the Borrower to the Lenders, the Co-Agents and the Administrative Agent. "Third Amendment" means the Third Amendment, dated as of October 11, 1996, to this Agreement among the Borrower, the Lenders party thereto, the Co-Agents and the Administrative Agent. "Third Amendment Effective Date" means the Third Amendment Effective Date as defined in Subpart 3.1 of the Third Amendment. SUBPART 2.1.2. Section 1.1 of the Existing Credit Agreement is further amended by (a) amending clause (b)(i) of the definition of "Consolidated Tangible Net Worth" in its entirety to read as follows: "(i) treasury stock (excluding the amount, not to exceed $45,000,000, of cash consideration expended for the -2- 3 repurchase and/or redemption of the Borrower's outstanding common stock in accordance with the 1996 Transaction that results in an increase in such treasury stock), subscribed but unissued stock, unamortized debt discount and expense, good will, trademarks, trade names, patents and other intangible assets (but not deferred charges) of the Borrower, and"; and (b) the definition of "Designated Debt" is amended in its entirety to read as follows: "`Designated Debt' means the aggregate amount of (i) Current Debt, and (ii) outstanding Loans and Letter of Credit Outstandings; provided, that from the Third Amendment Effective Date until the first anniversary thereof, Designated Debt shall exclude outstanding Loans and Letter of Credit Outstandings and outstanding Loans under (and as defined in) the Short Term Credit Agreement in up to an aggregate maximum outstanding principal amount of $64,500,000, as such amount is reduced Dollar for Dollar by the amount of Debt not constituting Designated Debt incurred during such period." SUBPART 2.2. Amendments to Article II. Section 2.2.2 of the Existing Credit Agreement is hereby amended in its entirety to read as follows: "SECTION 2.2.2. Mandatory Reduction of Commitments. Immediately upon the sale, lease, transfer, contribution or conveyance of an asset pursuant to clause (c) of Section 7.2.11 (other than in connection with the 1996 Transaction), the Loan Commitment Amount shall be automatically reduced by an amount equal to the aggregate Net Disposition Proceeds of such sale, lease, transfer, contribution or conveyance." SUBPART 2.3. Amendments to Article VII. Article VII of the Existing Credit Agreement is hereby amended in accordance with Subpart 2.3.1. SUBPART 2.3.1. Clauses (c) and (d) of Section 7.2.11 of the Existing Credit Agreement are hereby amended by: (a) amending clause (c) of such Section in its entirety to read as follows: -3- 4 "(c) such sale, transfer, lease, contribution or conveyance is (i) in connection with the 1996 Transaction (provided, that the Market Value of the gold sold or otherwise disposed of in connection therewith shall not exceed an aggregate amount equal to $45,000,000), or (ii) if not in the ordinary course of business, or not otherwise permitted hereunder, the assets are sold for fair value (as determined by the Board of Directors of the Borrower or the Subsidiary owning such assets) and the Commitments of the Lenders are reduced by an amount equal to the Net Disposition Proceeds of such sale, transfer, lease, contribution or conveyance; or"; and (b) amending clause (d) of such Section by deleting the words "Effective Date" wherever appearing therein and inserting the words "Third Amendment Effective Date" in each case in place thereof. SUBPART 2.4. Amendment to Exhibit E. Attachments 1 and 4 of Exhibit E (Compliance Certificate) to the Existing Credit Agreement are hereby amended in their entirety to read as set forth on Exhibit A hereto. PART III CONDITIONS TO EFFECTIVENESS SUBPART 3.1. Third Amendment Effective Date. This Amendatory Agreement shall become effective on the date first set forth above (the "Third Amendment Effective Date") when each of the conditions set forth in this Subpart 3.1 shall have been satisfied. SUBPART 3.1.1. Execution of Counterparts. The Administrative Agent shall have received counterparts of this Amendatory Agreement, duly executed on behalf of the Borrower and the Required Lenders. SUBPART 3.1.2. Short Term Credit Agreement Amendment No. 3. The conditions to the effectiveness of the Third Amendment to the Short Term Credit Agreement, also dated as of the date hereof ("ST Amendment No. 3") (other than the effectiveness of this Amendatory Agreement) shall have been satisfied and such ST Amendment No. 3 shall, concurrently with the effectiveness of -4- 5 this Amendatory Agreement, have been declared effective by the Administrative Agent. SUBPART 3.1.3. Legal Details, etc. All documents executed or submitted pursuant hereto shall be satisfactory in form and substance to the Administrative Agent and its counsel. The Administrative Agent and its counsel shall have received all information and such counterpart originals or such certified or other copies or such materials, as the Administrative Agent or its counsel may reasonably request, and all legal matters incident to the transactions contemplated by this Amendatory Agreement shall be satisfactory to the Administrative Agent and its counsel. PART IV MISCELLANEOUS SUBPART 4.1. Cross-References. References in this Amendatory Agreement to any Part or Subpart are, unless otherwise specified or otherwise required by the context, to such Part or Subpart of this Amendatory Agreement. SUBPART 4.2. Loan Document Pursuant to Existing Credit Agreement. This Amendatory Agreement is a Loan Document executed pursuant to the Existing Credit Agreement and shall be construed, administered and applied in accordance with all of the terms and provisions of the Existing Credit Agreement. SUBPART 4.3. Successors and Assigns. This Amendatory Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. SUBPART 4.4. Counterparts. This Amendatory Agreement may be executed by the parties hereto in several counterparts, each of which when executed and delivered shall be deemed to be an original and all of which shall constitute together but one and the same agreement. SUBPART 4.5. Representations, No Default, etc. As of the date of effectiveness of this Amendatory Agreement, the Borrower hereby represents and warrants to the Agents and the Lenders that (a) the representations and warranties set forth in Article VI of the Existing Credit Agreement (excluding, however, those contained in Section 6.7 thereof) are true and correct in all material respects (unless stated to relate solely to an earlier date, in which case such representations and warranties were true and correct as of such earlier date); -5- 6 (b) except as disclosed by the Borrower to the Administrative Agent and the Lenders pursuant to Section 6.7 of the Existing Credit Agreement, (i) no litigation, arbitration or governmental investigation or proceeding is pending or, to the knowledge of the Borrower, threatened against the Borrower or any of its Subsidiaries which may reasonably be expected to materially adversely affect the Borrower's, or the Borrower and its Subsidiaries' taken as a whole, financial condition, operations, assets, businesses, properties or prospects or which purports to affect the legality, validity or enforceability of the Existing Credit Agreement, the Notes or any other Loan Document; and (ii) no development has occurred in any litigation, arbitration or governmental investigation or proceeding disclosed pursuant to Section 6.7 of the Existing Credit Agreement which may reasonably be expected to materially adversely affect the financial condition, operations, assets, businesses, properties or prospects of the Borrower or the Borrower and its Subsidiaries, taken as a whole; and (c) no Default has occurred and is continuing. SUBPART 4.6. Limited Waiver, etc. No amendment, waiver or approval by the Agents or any Lender under this Amendatory Agreement shall, except as may be otherwise stated in this Amendatory Agreement, be applicable to subsequent transactions. No amendment, waiver or approval hereunder shall require any similar or dissimilar amendment, waiver or approval to be granted after the date hereof, and except as expressly modified by this Amendatory Agreement, the provisions of the Existing Credit Agreement shall remain in full force and effect, without amendment or other modification. SUBPART 4.7. Governing Law. THIS AMENDATORY AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK. -6- 7 IN WITNESS WHEREOF, the parties hereto have caused this Amendatory Agreement to be executed by their respective authorized officers as of the day and year first above written. HANDY & HARMAN By______________________________________ Title: THE BANK OF NOVA SCOTIA, in its capacity as Administrative Agent, Co-Agent and Lender By______________________________________ Title: THE BANK OF NEW YORK, in its capacity as Co-Agent and Lender By______________________________________ Title: THE CHASE MANHATTAN BANK (formerly known as Chemical Bank), in its capacity as Co-Agent and Lender By______________________________________ Title: FLEET PRECIOUS METALS INC. By______________________________________ Title: THE FIRST NATIONAL BANK OF CHICAGO (formerly known as NBD Bank) By______________________________________ Title: -7- 8 BANK OF TOKYO - MITSUBISHI TRUST COMPANY By______________________________________ Title: LTCB TRUST COMPANY By______________________________________ Title: CREDIT LYONNAIS NEW YORK BRANCH By______________________________________ Title: CREDIT LYONNAIS CAYMAN ISLAND BRANCH By______________________________________ Title: THE SUMITOMO BANK, LIMITED By______________________________________ Title: By______________________________________ Title: -8- 9 THE FUJI BANK, LIMITED, NEW YORK BRANCH By______________________________________ Title: ABN AMRO BANK N.V. NEW YORK BRANCH By______________________________________ Title: By______________________________________ Title: COMERICA BANK By______________________________________ Title: YASUDA TRUST & BANKING CO., LTD. NEW YORK BRANCH By______________________________________ Title: -9- 10 EXHIBIT A TO THIRD AMENDMENT ATTACHMENT 1 (to __/__/__ Compliance Certificate) ADJUSTED CONSOLIDATED TANGIBLE NET WORTH (________ __, 19__) ADJUSTED CONSOLIDATED TANGIBLE NET WORTH: A. The par value (or value stated on the books of the Borrower) of the capital stock of all classes of the Borrower.......................................................... $_________ B. The amount of the consolidated surplus, whether capital or earned, of the Borrower and its and its Subsidiaries............................................... $_________ C. The sum (or difference, in the case of a surplus deficit in Item 1.B) of Items 1.A and 1.B..................................... $_________ D. The aggregate amount of treasury stock (excluding the amount, not to exceed $45,000,000, of cash consideration expended for the repurchase and/or redemption of the of the Borrower's outstanding common stock in accordance with the 1996 Transaction), subscribed but unissued stock, unamortized debt discount and expense, good will, trademarks, trade names, patents and other intangible assets (but not deferred charges) of the Borrower and its Subsidiaries..................................... $_________ E. The aggregate amount of all write- ups in the book value of any assets owned by the Borrower or its Subsidiaries subsequent to March 16, 1992, other than write-ups of assets (and assets of Subsidiaries) acquired by the Borrower and/or its Subsidiaries (exclusive of goodwill) that are made in connection with the
11 acquisition thereof............................................... $_________ F. Sum of Items 1.D through 1.E...................................... $_________ G. CONSOLIDATED TANGIBLE NET WORTH: The excess of Item 1.C over Item 1.F............................... $_________ H. 40% of the excess of the Market Value of the Borrower's and its Subsidiaries' owned precious metal holdings over the LIFO cost of such holdings as set forth in the Borrower's most recent consolidated financial statements delivered pursuant to clause (a) or clause (b) of Section 7.1.1 of the Credit Agreement.................................................. $_________ I. ADJUSTED CONSOLIDATED TANGIBLE NET WORTH: The sum of Items 1.G and 1.H...................................... $_________
12 ATTACHMENT 4 (to __/__/__ Compliance Certificate) DESIGNATED DEBT (as of _________ __, 19__) DESIGNATED DEBT: A. Current Debt: The aggregate amount of current maturities of the consolidated Debt of the Borrower and its Subsidiaries, determined in accordance with GAAP.......................................... $_________ B. The sum of the aggregate outstanding principal amount of all Loans plus Letter of Credit Outstandings (as such terms are defined in the Long Term Credit Agreement)............................................. $_________ C. The sum of Item 4.A and Item 4.B (excluding, from the Third Amendment Effective Date until the first anniversary thereof, Loans and Letter of Credit Outstandings and Loans under (and as defined in) the Short Term Credit Agreement in up to a maximum principal amount of $64,500,000, as such amount is reduced Dollar for Dollar by the amount of Debt not constituting Designated Debt incurred during such period)........................................... $_________ D. 90% of the Market Value of the gold, silver and platinum group metals and the gold, silver and platinum group metals' content of alloys then owned by the Borrower and its Subsidiaries in inventory and not held in consignment................................... $_________ E. 75% of the Eligible Receivables of the Borrower and its Subsidiaries as computed on Attachment 5 hereto............................ $_________ F. The aggregate amount of cash and Cash Equivalent Investments of the Borrower and its Subsidiaries, but only to the extent that such cash and Cash Equivalent Investments are
13 not subject to any Lien and (if held or owned by a Subsidiary) are transferable to the Borrower without the consent or approval of any other Person.............................................. $_________ G. The sum of Items 4.D through 4.F.............................. $_________ H. The excess of Item 4.C over Item 4.G.......................... $_________
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