-----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, DglMSFn2Drq8proTfQ6dHr+JGHjpz7ga7rouaUbpiSxhAaMMB5Vdu5L2j3IDObFq UqA6wzHs6BFE+eJT4vFnGA== 0000940180-98-001159.txt : 19981118 0000940180-98-001159.hdr.sgml : 19981118 ACCESSION NUMBER: 0000940180-98-001159 CONFORMED SUBMISSION TYPE: SC 13E4/A PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 19981117 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: AMP INC CENTRAL INDEX KEY: 0000006164 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRONIC CONNECTORS [3678] IRS NUMBER: 230332575 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13E4/A SEC ACT: SEC FILE NUMBER: 005-10462 FILM NUMBER: 98753475 BUSINESS ADDRESS: STREET 1: P O 3608 CITY: HARRISBURG STATE: PA ZIP: 17105 BUSINESS PHONE: 7175640100 MAIL ADDRESS: STREET 1: PO BOX 3608 M S 176 41 CITY: HARRISBURG STATE: PA ZIP: 17105 FORMER COMPANY: FORMER CONFORMED NAME: AMP INC & PAMCOR INC DATE OF NAME CHANGE: 19890410 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN METAL PRODUCTS CO DATE OF NAME CHANGE: 19661211 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: AMP INC CENTRAL INDEX KEY: 0000006164 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRONIC CONNECTORS [3678] IRS NUMBER: 230332575 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13E4/A BUSINESS ADDRESS: STREET 1: P O 3608 CITY: HARRISBURG STATE: PA ZIP: 17105 BUSINESS PHONE: 7175640100 MAIL ADDRESS: STREET 1: PO BOX 3608 M S 176 41 CITY: HARRISBURG STATE: PA ZIP: 17105 FORMER COMPANY: FORMER CONFORMED NAME: AMP INC & PAMCOR INC DATE OF NAME CHANGE: 19890410 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN METAL PRODUCTS CO DATE OF NAME CHANGE: 19661211 SC 13E4/A 1 SCHEDULE 13E-4/A - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 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) (AMENDMENT NO. 5) ---------------- AMP INCORPORATED (NAME OF ISSUER) AMP INCORPORATED (NAME OF PERSON(S) FILING STATEMENT) ---------------- COMMON STOCK, WITHOUT PAR VALUE (INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS) (TITLE OF CLASS OF SECURITIES) 031897-10-1 (CUSIP NUMBER OF CLASS OF SECURITIES) DAVID F. HENSCHEL CORPORATE SECRETARY AMP INCORPORATED P.O. BOX 3608 HARRISBURG, PENNSYLVANIA 17105-3608 (717) 564-0100 (NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO RECEIVE NOTICES AND COMMUNICATIONS ON BEHALF OF THE PERSON(S) FILING STATEMENT) ---------------- COPY TO: PETER ALLAN ATKINS DAVID J. FRIEDMAN SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP 919 THIRD AVENUE NEW YORK, NEW YORK 10022-3897 (212) 735-3000 ---------------- OCTOBER 9, 1998 (DATE TENDER OFFER FIRST PUBLISHED, SENT OR GIVEN TO SECURITY HOLDERS) ---------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- This Amendment No. 5 amends and supplements the Issuer Tender Offer Statement on Schedule 13E-4 dated October 9, 1998, as amended (the "Schedule 13E-4"), filed by AMP Incorporated, a Pennsylvania corporation (the "Company"), in connection with AMP's offer to purchase up to 30,000,000 shares of its common stock, without par value (the "Shares"), including the associated common stock purchase rights (the "Rights"), at a price of $55 per Share, net to the seller in cash, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated October 9, 1998 (the "Offer to Purchase") and the related Letter of Transmittal (which, as amended from time to time, together constitute the "Offer"). Copies of the Offer to Purchase and the Letter of Transmittal are filed with the Securities and Exchange Commission as Exhibits (a)(1) and (a)(2), respectively, to the Schedule 13E-4. Those Sections of the Offer to Purchase amended and supplemented by the Supplement dated November 16, 1998 to the Offer to Purchase are hereby incorporated by reference in the Items of the Schedule 13E-4 in which such Sections are referred to. ITEM 9. MATERIAL TO BE FILED AS EXHIBITS. Item 9 is hereby amended by the addition of the following Exhibits thereto: (a)(10)Supplement to the Offer to Purchase dated November 16, 1998. (a)(11)Form of Letter of Transmittal furnished with the Supplement. (a)(12)Form of Notice of Guaranteed Delivery furnished with the Supplement. (a)(13)Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees furnished with the Supplement. (a)(14)Form of Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees furnished with the Supplement. (g)(1)Pages 33 through 49 and page 51 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1997 (incorporated by reference from the Company's Form 10-K filed with the Commission on March 26, 1998).* - -------- *This Exhibit replaces Exhibit (g)(1) previously filed with the Schedule 13E- 4. 2 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. AMP Incorporated /s/ Robert Ripp By:__________________________________ Name: Robert Ripp Title: Chairman and Chief Executive Officer Dated: November 16, 1998 3 INDEX TO EXHIBITS
ITEM DESCRIPTION ---- ----------- (a)(10) Supplement to the Offer to Purchase dated November 16, 1998. (a)(11) Form of Letter of Transmittal furnished with the Supplement. (a)(12) Form of Notice of Guaranteed Delivery furnished with the Supplement. (a)(13) Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees furnished with the Supplement. (a)(14) Form of Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees furnished with the Supplement. (g)(1) Pages 33 through 49 and page 51 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1997 (incorporated by reference from the Company's Form 10-K filed with the Commission on March 26, 1998).*
- -------- *This Exhibit replaces Exhibit (g)(1) previously filed with the Schedule 13E-4. 4 EX-99.(A)(10) 2 SUPPLEMENT TO THE OFFER TO PURCHASE EXHIBIT (A)(10) SUPPLEMENT TO OFFER TO PURCHASE FOR CASH BY AMP INCORPORATED OF UP TO 30,000,000 SHARES OF ITS COMMON STOCK (INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS) AT $55 NET PER SHARE THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON WEDNESDAY, NOVEMBER 25, 1998, UNLESS THE OFFER IS EXTENDED. AMP Incorporated, a Pennsylvania corporation (the "Company" or "AMP"), has invited its shareholders to tender shares of its common stock, without par value (the "Shares") (including the associated common stock purchase rights (the "Rights"), issued pursuant to the Rights Agreement, dated as of October 25, 1989 and as amended, between the Company and ChaseMellon Shareholder Services L.L.C., as Rights Agent), to the Company at $55 per Share, net to the seller in cash, without interest (such amount, or any greater amount per Share as may be paid pursuant to the Offer, being referred to herein as the "Purchase Price"), upon the terms and subject to the conditions set forth in the Offer to Purchase dated October 9, 1998, as amended ("Offer to Purchase"), this Supplement and the related Letter of Transmittal (which, as amended from time to time, together constitute the "Offer"). Unless the context otherwise requires, all references to Shares shall include the associated Rights. THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS INCLUDING THE COMPANY'S HAVING OBTAINED SUFFICIENT FINANCING FOR THE PURCHASE OF SHARES AND ALL CONDITIONS TO SUCH FINANCING, OTHER THAN THE PURCHASE OF SHARES PURSUANT TO THE OFFER, BEING SATISFIED ON OR PRIOR TO THE EXPIRATION DATE OF THE OFFER. SEE SECTIONS 5 AND 9. The Shares are listed on the New York Stock Exchange, Inc. (the "NYSE") and traded on the NYSE, Boston, Cincinnati, Chicago, Pacific and Philadelphia exchanges under the symbol "AMP." On November 16, 1998, the last full trading day on the NYSE prior to the mailing of this Supplement, the closing per Share sales price as reported on the NYSE Composite Tape was $43 15/16. Shareholders are urged to obtain current market quotations for the 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. 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 DEALER MANAGERS FOR THE OFFER ARE: CREDIT SUISSE FIRST BOSTON DONALDSON, LUFKIN & JENRETTE The Date of this Supplement is November 16, 1998. 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 the Letter of Transmittal 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 2 of the Offer to Purchase, 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 2 of the Offer to Purchase. TO EFFECT A VALID TENDER OF THEIR SHARES, SHAREHOLDERS MUST VALIDLY COMPLETE THE LETTER OF TRANSMITTAL. Questions and requests for assistance or for additional copies of the Offer to Purchase, this Supplement and the Letter of Transmittal or the Notice of Guaranteed Delivery may be directed to the Information Agent or the Dealer Managers at their addresses and telephone numbers set forth on the back cover of this Supplement. 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 THE OFFER TO PURCHASE, THIS SUPPLEMENT 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. TO THE HOLDERS OF SHARES OF COMMON STOCK OF AMP INCORPORATED: INTRODUCTION The following information amends and supplements the Offer to Purchase, dated October 9, 1998, as amended ("Offer to Purchase") of AMP Incorporated, a Pennsylvania corporation (the "Company" or "AMP"), pursuant to which the Company is offering to purchase up to 30,000,000 shares of its common stock, without par value (the "Shares") (including the associated common stock purchase rights (the "Rights"), issued pursuant to the Rights Agreement ("Rights Agreement"), dated as of October 25, 1989 and as amended on September 4, 1992, August 12, 1998, August 20, 1998, and September 17, 1998, between the Company and ChaseMellon Shareholder Services L.L.C., as Rights Agent), at $55 per Share, net to the seller in cash, without interest, (such amount, or any greater amount per Share as may be paid pursuant to the Offer, being referred to herein as the "Purchase Price"), upon the terms and subject to the conditions set forth in the Offer to Purchase, this Supplement and the related Letter of Transmittal (which, as amended from time to time, together constitute the "Offer"). Unless the context otherwise requires, all references to Shares in the Offer to Purchase and this Supplement shall include the associated Rights. This Supplement should be read in conjunction with the Offer to Purchase. This Supplement, among other things, sets forth certain additional information and revises and restates in their entirety Section 5 and Section 9 of the Offer to Purchase. Except as set forth in this Supplement, the terms and conditions previously set forth in the Offer to Purchase and the Letter of Transmittal remain applicable in all respects to the Offer. Capitalized terms used but not defined in this Supplement have the meanings assigned to them in 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 INCLUDING THE COMPANY'S HAVING OBTAINED SUFFICIENT FINANCING FOR THE PURCHASE OF SHARES AND ALL CONDITIONS TO SUCH FINANCING, OTHER THAN THE PURCHASE OF SHARES PURSUANT TO THE OFFER, BEING SATISFIED ON OR PRIOR TO THE EXPIRATION DATE OF THE OFFER (THE "FINANCING CONDITION"). SEE SECTIONS 5 AND 9. In connection with the Offer, the Company has obtained commitments from an affiliate of CSFB, an affiliate of DLJ, The Chase Manhattan Bank and an affiliate of The Chase Manhattan Bank to provide on the terms, and subject to the conditions specified in such commitments, the financing necessary to consummate the Offer and provide for the Company's anticipated working capital or other needs. The Financing Condition will not be deemed satisfied, unless otherwise determined by the Company, upon receipt of the proceeds of the financing contemplated by the commitment letter signed with these institutions (the "Commitment Letter") if the overall final terms of the bank facilities are not satisfactory to the Company. See Sections 5 and 9. FORWARD-LOOKING STATEMENTS The Offer to Purchase and this Supplement contain certain "forward-looking" statements. The safe harbors intended to be created by Section 21E of the Securities Exchange Act of 1934, as amended, are not available to statements made in connection with a tender offer. Accordingly, such safe harbors may not be available to statements made in connection with this self-tender offer, including statements incorporated herein by reference to the Company's Annual Report on Form 10-K or otherwise. However, shareholders should be aware that any such forward-looking statements should be considered as subject to the risks and uncertainties that exist in the Company's operations and business environment which could render actual outcomes and results materially different than predicted. For a description of some of the factors or uncertainties which could cause actual results to differ, reference is made to the section entitled "Cautionary Statements for Purposes of the 'Safe Harbor'" in the Company's Annual Report on Form 10-K for the year ended December 31, 1997, a copy of which was also filed as Exhibit 19 to the Company's Schedule 14D-9 filed with the Securities and Exchange Commission. In addition, the realization of the benefits anticipated from the strategic initiatives will be dependent, in part, on management's ability to execute its business plans and to motivate properly the Company employees, whose attention may have been distracted by AlliedSignal's tender offers and whose numbers will have been reduced as a result of these initiatives. 1 THE OFFER 2. PROCEDURE FOR TENDERING SHARES. The discussion set forth in Section 2 of the Offer to Purchase is hereby amended and supplemented as follows: 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. The revised Letter of Transmittal distributed with this Supplement may be used to tender Shares. Tendering shareholders also may continue to use the Letter of Transmittal previously delivered with the Offer to Purchase to tender Shares. By tendering Shares pursuant to the revised Letter of Transmittal or the Letter of Transmittal previously distributed, tendering shareholders will be deemed to represent and warrant to the Company that the tender of Shares complies with Rule 14e-4 under the Exchange Act. SHAREHOLDERS WHO HAVE PREVIOUSLY TENDERED SHARES PURSUANT TO THE OFFER AND WHO HAVE NOT WITHDRAWN SHARES NEED NOT TAKE ANY FURTHER ACTION IN ORDER TO TENDER SHARES PURSUANT TO THE OFFER. 5. CERTAIN CONDITIONS OF THE OFFER. The discussion set forth in Section 5 of the Offer to Purchase is hereby amended and restated in its entirety as follows: The Offer is conditioned upon the Company's having obtained sufficient financing for the purchase of Shares and all conditions to such financing, other than the purchase of Shares pursuant to the Offer, being satisfied on or prior to the Expiration Date of the Offer. This condition will not be deemed satisfied, unless otherwise determined by the Company, upon the receipt of the proceeds of the financing contemplated by the Commitment Letter if the overall final terms and conditions of the bank facilities are not satisfactory to the Company. Such financing is subject to certain conditions, including finalization of certain financial terms and other provisions, and that the Company shall not have had a change in its Board of Directors resulting in less than a majority being "disinterested directors" (as such term is defined in Section 1715(e) of the PBCL). See Section 9. In addition, and 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 September 28, 1998 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) such conditions are not met or if 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 or impracticable to proceed with the Offer or with such acceptance for payment or payment; provided that the Company will not assert any such conditions or events (other than those relating to regulatory approvals) after the Expiration Date: (a) there shall have been any action threatened or taken, or approval withheld, or any statute, rule or regulation 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 governmental, regulatory or administrative authority or agency or tribunal, domestic or foreign, which, in the Company's reasonable judgment, would directly or indirectly: (i) make the acceptance for payment of, or payment for, some or all of the Shares illegal or otherwise restrict or prohibit consummation of the Offer, or (ii) delay or restrict the ability of the Company, or render the Company unable, to accept for payment or pay for some or all of the Shares pursuant to the Offer; or (b) there shall be threatened, instituted or pending any action or proceeding by any government or governmental authority or agency, domestic or foreign, or by any other person, domestic or foreign, before 2 any court or governmental authority or agency, domestic or foreign, challenging or seeking to, or which could, make illegal, delay or otherwise directly or indirectly restrain or prohibit or make more costly the making of the Offer, the acceptance for payment of, or payment for, some of or all Shares pursuant to the Offer or the purchase of Shares pursuant to the Offer, seeking to obtain damages in connection with the Offer, or seeking to restrain or prohibit the consummation of the Offer or the transactions contemplated thereby or which otherwise directly or indirectly relates to the Offer; or (c) a preliminary or permanent injunction or other order by any Federal or state court which prevents the acceptance for payment of, or payment for, some of or all the Shares pursuant to the Offer shall have been issued and shall remain in effect; or (d) there shall have occurred: (i) the declaration of any banking moratorium or suspension of payments in respect of banks in the United States; (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 Company's reasonable judgment, might affect, the extension of credit by banks or other lending institutions in the United States; or (v) in the case of any of the foregoing existing at the time of the commencement of the Offer, in the Company's reasonable judgment, a material acceleration or worsening thereof; or (e) (i) following consummation of the Second Amended AlliedSignal Offer, AlliedSignal shall have commenced another tender offer at a price greater than $44.50 per Share or otherwise on terms materially different than the Second Amended AlliedSignal Offer, or (ii) any person shall publicly disclose an acquisition or business combination proposal with respect to the Company or any of its securities or assets, or (iii) a tender or exchange offer for the Shares (other than by AlliedSignal or its affiliates) shall have been commenced by any person, if such tender or exchange offer could result in such other person and its affiliates beneficially owning directly or indirectly more than 5% of the outstanding Shares, or (iv) it shall have been publicly disclosed or the Company shall have learned that any person or "group" (within the meaning of Section 13(d)(3) of the Exchange Act) (other than the Company or its affiliates or AlliedSignal or its affiliates) shall have acquired, or proposed to acquire, more than 5% of the outstanding Shares, other than acquisitions of additional Shares representing not more than 2% of the outstanding Shares by any person or group owning more than 5% of the outstanding Shares on September 28, 1998, as disclosed in a Schedule 13D or 13G on file with the Securities and Exchange Commission of that date; or (f) the Company shall have entered into a definitive agreement or any agreement in principle, or shall have announced an intention to pursue or seek to pursue a transaction, in each instance with respect to a merger, other business combination or acquisition proposal or disposition of assets other than in the ordinary course of business; or (g) all consents and approvals required to be obtained from any Federal or state governmental agency, authority or instrumentality in connection with the Offer shall not have been obtained or the Company shall have been advised, or shall otherwise have reason to believe, that any such consent or approval will be denied or substantially delayed, or will not be given other than upon terms or conditions which would, in the opinion of the Company, make it impracticable to proceed with the Offer. 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. 3 7. BACKGROUND AND PURPOSE OF THE OFFER; CERTAIN EFFECTS OF THE OFFER. The discussion set forth under "Litigation" in Section 7 of the Offer to Purchase is hereby amended and supplemented as follows: On October 9, 1998, AlliedSignal filed appeals in AlliedSignal v. AMP and in AMP v. AlliedSignal, et al. in the United States Court of Appeals for the Third Circuit (the "Court of Appeals"). In the AlliedSignal v. AMP action, AlliedSignal appealed the District Court's denial of AlliedSignal's motion for summary judgment and a preliminary injunction with respect to amendments to the Rights Agreement. In the AMP v. AlliedSignal action, AlliedSignal appealed from that portion of the District Court's October 8, 1998 Order which granted partial summary judgment to the Company and enjoined AlliedSignal's consent solicitation until such time as AlliedSignal shall have complied with such order. AlliedSignal also filed a motion for expedited review of the appeals. The motion for expedited review has been granted. The shareholder group filed a notice of appeal from the District Court's determination that they do not have standing to seek an injunction; that appeal has been withdrawn. AlliedSignal filed its opening brief on October 13, 1998 and AMP filed its brief on October 20, 1998. AlliedSignal filed its reply brief on October 23, 1998. The shareholder group and the College Retirement Equities Fund have filed amici curiae briefs in the appeals filed by AlliedSignal. Argument on the appeals has not yet been scheduled. After the issuance of the October 8, 1998 Order and Memorandum Opinion, the Court has held several conferences regarding the injunction relating to AlliedSignal's consent solicitation. The Court reiterated that the injunction was in force until further order of the Court. At a conference on October 21, 1998, the parties were prepared to present evidence regarding AlliedSignal's assertion that it has complied with the Court's order. That hearing was postponed to November 4, 1998. On October 22, 1998, AlliedSignal filed with the Court of Appeals an Emergency Motion For A Stay Of Injunction Pending Expedited Appeal or, in the alternative, For An Emergency Hearing On A Limited Merits Issue. The motion requested the Court of Appeals to stay the District Court's injunction of the consent solicitation to allow AlliedSignal to continue the consent solicitation on the condition that, if the Company's shareholders consented to the proposed By-Law amendments and the election of the AlliedSignal Nominees, the By-Law amendments would not become effective and the nominees would not take office until either the Court of Appeals vacated the injunction or the District Court found that AlliedSignal had complied with the injunction. On November 2, 1998, the United States Court of Appeals for the Third Circuit issued an order denying AlliedSignal's motion to stay the District Court's injunction. AlliedSignal also separately appealed an order issued by the District Court on October 21, 1998 that the injunction remained in place until further order, and moved to consolidate that appeal with its earlier appeal. The Court of Appeals has not decided the motion to consolidate. At a hearing on November 4, 1998, the District Court heard evidence and arguments with respect to (x) AlliedSignal's assertion that it had complied with the Court's October 8, 1998 order and, as a result, the injunction regarding the consent solicitation should be dissolved; and (y) AMP's motion for a declaratory injunction that the consent solicitation proposals to elect seventeen AlliedSignal directors and officers to AMP's Board of Directors are unlawful under Pennsylvania law and for a permanent injunction to prevent the consent solicitation. After the presentation of evidence and arguments, the Court ruled that it was inclined to find that AlliedSignal had complied with the October 8, 1998 order if each of the AlliedSignal nominees signs an additional statement acknowledging, among other things, that, in discharging his or her fiduciary duties to AMP if seated on the AMP Board, AlliedSignal has not waived the duty of loyalty owed by the nominees to AlliedSignal. The nominees' duty of loyalty to AlliedSignal may require them, if seated as AMP directors, to abstain from voting on matters such as entering into a merger agreement with AlliedSignal, considering third party proposals to acquire AMP, determining whether AMP should remain independent, and other decisions fundamental to AMP's future. If AlliedSignal submits evidence of compliance with the Court's November 4, 1998 ruling and when the District Court has authority from the Court of Appeals to dissolve the injunction (AlliedSignal having appealed the injunction), the Court indicated that it would be inclined to dissolve the injunction. The Court also denied AMP's motion for a declaratory judgment and permanent injunction. As of November 16, 1998, the District Court had not yet entered an order that it would be inclined to dissolve the injunction. 4 9. SOURCE AND AMOUNT OF FUNDS. The discussion set forth in Section 9 of the Offer to Purchase is hereby amended and restated in its entirety as follows: The Company entered into commitment letters (the "Original Commitment Letters"), dated September 27, 1998, with Credit Suisse First Boston, New York branch ("CS"), an affiliate of CSFB, and DLJ Capital Funding, Inc. ("DLJC"), an affiliate of DLJ, providing for (a) borrowings under a senior secured bank facility (consisting of $1,750 million of term loans and a $750 million revolving credit facility) and (b) (i) the issuance of up to $750 million of senior notes of the Company (the "Senior Notes") through a private placement offering and/or (ii) to the extent that the Senior Notes are not sold prior to the purchase of the Shares, a bridge loan (the "Bridge Loan") of up to $750 million. On October 29, 1998, the Company entered into a letter agreement with the parties to the Original Commitment Letters terminating the commitments under such letters. The Company expects to finance the Offer solely with the proceeds of the Senior Bank Facility referred to below. Financing the Offer. The Company estimates that the total funds required to purchase 30,000,000 shares pursuant to the Offer and to pay related fees and expenses will be approximately $1.7 billion. The Company intends to obtain such funds, as well as any funds required to refinance any of the Company's existing indebtedness which may be repaid in connection with the Offer, by means of proceeds of borrowings under a senior secured bank facility (consisting of $1,400 million of term loans and a $1,200 million revolving credit facility (collectively, the "Senior Bank Facility") pursuant to a commitment letter (the "Commitment Letter"), dated October 29, 1998, from CS, DLJC, The Chase Manhattan Bank ("Chase") and Chase Securities Inc. (together with CS, DLJC and Chase are hereinafter referred to collectively as the "Lenders"). The Company expects to repay indebtedness incurred as a result of the Offer through cash flow from operations or through refinancing of such indebtedness at a later date. THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THE COMPANY'S HAVING OBTAINED SUFFICIENT FINANCING FOR THE PURCHASE OF SHARES AND ALL CONDITIONS TO SUCH FINANCING, OTHER THAN THE PURCHASE OF SHARE PURSUANT TO THE OFFER, BEING SATISFIED ON OR PRIOR TO THE EXPIRATION DATE OF THE OFFER. SEE SECTION 5. The terms of the Senior Bank Facility have not yet been finalized and are still being negotiated. Moreover, the documentation evidencing the Senior Bank Facility has not yet been finalized. Accordingly, the description below of the Senior Bank Facility is preliminary and necessarily incomplete. In addition, the terms and provisions of the Senior Bank Facility, to the extent described, are subject to change if the terms of the Offer change. In any event, the ultimate Senior Bank Facility might contain terms that are more or less onerous than those currently contemplated. Senior Bank Facility As set forth above under "Financing the Offer," the Lenders have delivered the Commitment Letter. Pursuant to the Commitment Letter, the Lenders have committed to provide the Senior Bank Facility on a senior secured basis, such Facility to include a sublimit for the issuance of letters of credit, all upon the terms and subject to the conditions set forth in the Commitment Letter, including the execution of definitive financing documents and that a Change of Control (as defined below) shall not have occurred. A "Change of Control" will have occurred if, among other things, the Second Offer is consummated or the Company shall have had a change in its Board of Directors resulting in less than a majority of the directors being "disinterested directors" (as such term is defined in Section 1715(e) of the PBCL), which will occur if the AlliedSignal Nominees are elected to the Board of Directors. The Commitment Letter provides that the commitments of the Lenders will terminate unless definitive financing documents with respect thereto shall have been executed and delivered on or prior to December 18, 1998. Funding pursuant to the Commitment Letter is subject to certain conditions precedent, including but not limited to (i) the negotiation, execution and delivery of definitive documents reasonably satisfactory to the Lenders, (ii) the completion of the Offer, (iii) no material adverse change in the banking or capital markets that could materially impair the syndication of bank facilities or consummation of securities offerings, (iv) the Company's achieving a minimum EBITDA (operating income plus taxes, depreciation and amortization) for the 5 fiscal quarter ending September 30, 1998, (v) the Company's having received investment grade ratings on its long term secured senior indebtedness from both Standard and Poor's Corporation and Moody's Investor Service, (vi) the Company shall not have entered into any agreement (or announced its intention to pursue a transaction) with respect to a merger, acquisition or other business combination which the Lenders in their reasonable judgment shall have determined will adversely affect their ability to successfully syndicate the Senior Bank Facility and (vii) no occurrence of any event or events, adverse condition or change in or affecting the Borrower that, individually or in the aggregate, could reasonably be expected to have a material adverse effect on (x) the business, results of operations, property, condition (financial or otherwise) or prospects of the Company and its subsidiaries, taken as a whole, or (y) the validity or enforceability of any documents entered into in connection with the Offer or the Senior Bank Facility, the other transactions contemplated by the Offer or the Senior Bank Facility, or the rights, remedies and benefits available to the parties thereunder. The Lenders are also entitled to change the structure, terms or pricing of the Senior Bank Facility if the syndication has not been completed and if the Lenders determine that such changes are advisable in order to insure a successful syndication of the Senior Bank Facility; provided, however, that the total amount of the Senior Bank Facility shall remain unchanged. The Senior Bank Facility will be provided pursuant to the terms and conditions of the Credit Agreement to be entered into by the Company and the Lenders. Pursuant to the Commitment Letter, the Senior Bank facility is expected to consist of (i) two senior secured revolving credit and working capital Facilities available to the Company in a maximum principal amount not to exceed $1,200 million consisting of (x) a five year facility (the "Five Year Facility") in an aggregate principal amount of $800 million, a portion of which may be comprised of letters of credit (the "Letters of Credit") and (y) a 364-day facility (the "364 Day Facility") in an aggregate principal amount up to $400 million and (ii) two senior secured term loan facilities in a maximum principal amount not to exceed $1,400 million consisting of (x) a $1 billion Tranche A term loan which will mature in five years and (y) a $400 million Tranche B term loan which will mature in seven years. Lenders' commitments under the 364 Day Facility will terminate on the 364th day following the initial funding. At a request of the Company and AMP Finance Limited, the 364 Day Facility may be extended for an additional 364 days for a period not to exceed the Five-Year Facility. If a Lender elects not to participate in any extension, then the outstanding loans made by such Lender shall convert to a bullet maturing five years from the initial funding or be repaid according to an amortization schedule to be agreed upon in the final documentation. Both the Tranche A and Tranche B term loans will amortize quarterly. Annual scheduled repayments under Tranche A will amount to $125 million in the second year following the initial funding, $225 million in the third year, $275 million in the fourth year and $375 million in the fifth year. Annual scheduled repayments in Tranche B will aggregate $20 million in the second through sixth years following the initial funding and $380 million in the seventh year. The availability of the Senior Bank Facility will be reduced by the aggregate amount of certain indebtedness of the Company that remains outstanding after giving effect to the Offer. Borrowings under the Five Year Facility and the 364 Day Facility are available to both the Company and AMP Finance Limited. All existing and hereafter acquired domestic subsidiaries of the Company will unconditionally guarantee the obligations of the Company arising under the Senior Bank Facility. The Company will unconditionally guarantee the obligations of AMP Finance Limited arising under the Senior Bank Facility. The Senior Bank Facility, and the guarantee obligations in respect thereof, will be secured by a security interest in substantially all the assets of the Company and its domestic subsidiaries. The security interest shall be released if, and only if, (x) Moody's and S&P assign ratings of Baal and BBB+, respectively, or better to the Company's long term unsecured senior indebtedness for a period of thirty consecutive days and (y) at the end of such thirty day period, there is no default or event of default. The Senior Bank Facility will be required to be prepaid with (subject to certain exceptions): (i) the net proceeds from the issuance of any debt or equity securities of the Company or any of its subsidiaries or (ii) the net proceeds from non-ordinary course asset sales or (iii) a certain percentage of excess cash flow. Voluntary prepayment of the Senior Bank Facility, in whole or in part, is permitted at any time. Indebtedness outstanding under Tranche A and the revolving line of credit of the Senior Bank Facility will bear an initial interest rate, 6 computed on a per annum basis, equal to either the Base Rate (as defined below) plus 1.0% or LIBOR plus 2.0%. Indebtedness outstanding under Tranche B of the Senior Bank Facility will bear an initial interest rate, computed on a per annum basis equal to either the Base Rate plus 1.75 % or LIBOR plus 2.75%. The LIBOR and Base Rate margins will be subject to performance pricing step- downs to be determined. "Base Rate" shall mean the higher of (i) the Administrative Agent's prime rate and (ii) the Federal Funds rate plus 0.5%. Fees payable in respect of letters of credit shall be in an amount equal to the interest rate margin on LIBOR based loans then in effect, due quarterly in arrears. The issuer of a letter of credit shall be paid a per annum fronting fee of .25% on the face amount of all letters of credit, due quarterly in arrears. Additionally, the Company shall pay the issuer of a letter of credit its customary letter of credit charges as in effect from time to time. The Senior Bank Facility will contain certain representations and warranties, certain negative and affirmative financial covenants, certain conditions and events of default which are customarily required for similar financings. Representations and warranties will probably apply to the Company and its subsidiaries. Such covenants will include restrictions and limitations on dividends and stock redemptions, capital expenditures, leases, incurrence of debt, transactions with affiliates, investments and acquisitions, and mergers, consolidations and assets sales. Furthermore, the Company will be required to maintain compliance with certain financial covenants such as a Maximum Leverage Ratio, an Interest Coverage Ratio and Minimum Net Worth (as such terms will be defined in the Credit Agreement). The foregoing description is qualified in its entirety by reference to the Commitment Letter a copy of which is filed as exhibit to the Schedule 13E-4 and is incorporated herein by reference. Fees Associated with Financing. The Company has agreed to pay certain commitment, ticking and funding fees to the Lenders in connection with the financing. Such fees will aggregate at least $28.75 million. In the event that at the consummation of the Offer all amounts are drawn under the Senior Bank Facility, the fees will aggregate approximately $54.75 million (excluding ticking fees through that date). 10. CERTAIN INFORMATION ABOUT THE COMPANY. The discussions set forth under "Historical Financial Information" and "Pro Forma Financial Information" in Section 10 of the Offer to Purchase are hereby amended and restated in their entirety as follows: 7 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 1996 and 1997 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 Report on Form 10-K for the fiscal year ended December 31, 1997 and is hereby incorporated herein by reference. The historical financial information presented for the nine months ended September 30, 1997 and 1998 is unaudited. Such historical financial information has been derived from, and should be read in conjunction with, the unaudited consolidated financial statements of the Company reported in the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1998 and is hereby incorporated herein by reference. Copies of reports may be inspected or obtained from the Commission in the manner specified in "Additional Information" below. AMP INCORPORATED & SUBSIDIARIES SUMMARY HISTORICAL CONSOLIDATED FINANCIAL INFORMATION (IN THOUSANDS, EXCEPT RATIOS AND PER SHARE AMOUNTS)
YEAR ENDED NINE MONTHS ENDED --------------------- --------------------- DECEMBER DECEMBER SEPTEMBER SEPTEMBER 31, 31, 30, 30, 1996 1997 1997 1998 ---------- ---------- ---------- ---------- (UNAUDITED) Income Statement Data Net sales....................... $5,468,028 $5,745,235 $4,293,472 $4,084,869 Gross income.................... 1,565,295 1,768,629 1,372,362 1,206,764 SG&A............................ 964,589 1,022,856 828,516 822,968 Restructuring charge (credit)... 98,000 (21,338) -- 185,778 ---------- ---------- ---------- ---------- Income from operations.......... 502,706 767,111 543,846 198,018 Income before income taxes and cumulative effect of accounting changes........................ 438,308 677,985 489,223 120,040 Net income before cumulative effect of accounting changes... 286,984 457,640 330,226 81,025 Cumulative effect of accounting changes........................ -- 15,450 15,450 -- ---------- ---------- ---------- ---------- Net income...................... $ 286,984 $ 473,090 $ 345,676 $ 81,025 ========== ========== ========== ========== Basic Earnings Per Share EPS before cumulative effect of accounting changes............. $ 1.31 $ 2.08 $ 1.50 $ 0.37 Cumulative effect of accounting changes........................ -- 0.07 0.07 -- Earnings per share.............. $ 1.31 $ 2.15 $ 1.57 $ 0.37 Average shares outstanding, basic.......................... 219,200 219,800 219,700 219,200 Diluted Earnings Per Share EPS before cumulative effect of accounting changes............. $ 1.31 $ 2.08 $ 1.50 $ 0.37 Cumulative effect of accounting changes........................ -- 0.07 0.07 -- Earnings per share.............. $ 1.31 $ 2.15 $ 1.57 $ 0.37 Average shares outstanding, diluted........................ 219,600 220,400 220,300 219,900 Ratio of Earnings to Fixed Charges (unaudited)............ 8.7 12.6 13.7 3.7 Balance Sheet Data Working capital................. $ 911,285 $1,204,504 $1,116,165 $1,095,398 Total assets.................... 4,685,705 4,848,103 4,808,011 4,718,265 Total long-term debt............ 181,599 159,695 172,703 170,360 Shareholders' equity............ 2,789,898 2,951,535 2,897,959 2,817,850 Book value per common share (unaudited).................... $ 12.71 $ 13.42 $ 13.19 $ 12.86
8 Pro Forma Financial Information. The following summary unaudited consolidated pro forma financial statements give effect to the following transactions: (i) the consummation of the Offer and the purchase thereunder of 30,000,000 Shares at a price of $55 per Share, (ii) the execution of revised commitments related to the Senior Bank Facility and borrowings under the Senior Bank Facility, and (iii) the establishment of the Flexitrust, a grantor trust, to hold newly issued Shares to fund employee benefits and compensation programs. The pro forma financial statements have been prepared assuming that the Company has drawn down under the Senior Bank Facility all amounts required to finance the Offer and that all existing indebtedness shall remain outstanding. The cost savings anticipated to be realized as a result of the Company's Profit Improvement Plan are not reflected in the pro forma adjustments. The summary unaudited pro forma consolidated financial statements should be read in conjunction with the accompanying notes and the summary consolidated historical financial information. The summary unaudited pro forma consolidated financial statements have been prepared, as if the transactions referred to above had taken place (i) at the beginning of 1997 for income statement purposes, and (ii) at the end of the periods presented for balance sheet purposes, but, in each case, such information does not purport to be indicative of the results that would actually have been achieved had the preceding transactions been completed on the dates indicated or that may be achieved in the future. AMP INCORPORATED & SUBSIDIARIES UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME FOR THE YEAR ENDED DECEMBER 31, 1997
PRO FORMA PRO HISTORICAL ADJUSTMENTS FORMA ---------- ----------- ---------- (DOLLARS IN THOUSANDS EXCEPT PER SHARE DATA) Net sales............................... $5,745,235 $ $5,745,235 Cost of sales........................... 3,976,606 3,976,606 ---------- ---------- ---------- Gross income.......................... 1,768,629 -- 1,768,629 SG&A expenses........................... 1,022,856 1,022,856 Restructuring credit.................... (21,338) (21,338) ---------- ---------- ---------- Income from operations................ 767,111 -- 767,111 Interest expense........................ (31,843) (25,609)(1) (183,192) (125,740)(2) Other deductions, net................... (57,283) (57,283) ---------- ---------- ---------- Income before income taxes............ 677,985 (151,349)(3) 526,636 Income taxes............................ 220,345 (49,189)(4) 171,156 ---------- ---------- ---------- Net income before accounting change..... $ 457,640 $ (102,160)(5) $ 355,480 ========== ========== ========== Basic Shares............................ 219,770 (30,000)(6) 189,770 Basic EPS............................... $ 2.08 $ 1.87 Diluted Shares.......................... 220,375 (30,000)(6) 190,375 Diluted EPS............................. $ 2.08 $ 1.87 Ratio of Earnings to Fixed Charges...... 12.6 3.5
9 AMP INCORPORATED & SUBSIDIARIES UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998
PRO FORMA PRO HISTORICAL ADJUSTMENTS FORMA ----------- ----------- ---------- (DOLLARS IN THOUSANDS EXCEPT PER SHARE DATA) Net sales............................... $ 4,084,869 $ $4,084,869 Cost of sales........................... 2,878,105 2,878,105 ----------- -------- ---------- Gross income............................ 1,206,764 -- 1,206,764 SG&A expenses........................... 822,968 822,968 Restructuring and one-time charges...... 185,778 185,778 ----------- -------- ---------- Income from operations................ 198,018 -- 198,018 Interest expense........................ (31,154) (3,575)(1) (130,082) (95,353)(2) Other deductions, net................... (46,824) (46,824) ----------- -------- ---------- Income before income taxes............ 120,040 (98,928)(3) 21,112 Income taxes............................ 39,015 (32,152)(4) 6,863 ----------- -------- ---------- Net income.............................. $ 81,025 $(66,776)(5) $ 14,249 =========== ======== ========== Basic Shares............................ 219,165 (30,000)(6) 189,165 Basic EPS............................... $ 0.37 $ 0.08 Diluted Shares.......................... 219,886 (30,000)(6) 189,886 Diluted EPS............................. $ 0.37 $ 0.08 Ratio of Earnings to Fixed Charges...... 3.7 1.1
10 NOTES TO THE SUMMARY UNAUDITED PRO FORMA CONSOLIDATED STATEMENTS OF INCOME (1) Represents bank fees and undrawn fees expensed as incurred or deferred and amortized related to the following loans:
YEAR ENDED, NINE MONTHS ENDED, FEE DECEMBER 31, 1997 SEPTEMBER 30, 1998 --- ----------------- ------------------ Fees on undrawn Revolvers and letters of credit fees....................... $ 4.75 million $3.60 million Amortization of deferred financing fees................................. 18.11 million 7.48 million Fee on original (terminated) commitments.......................... 2.75 million (7.50) million -------------- -------------- Total............................... $25.61 million $3.58 million ============== ==============
The aggregate fees associated with the financings are estimated to be approximately $54.75 million, including $2.75 million of commitment fees expensed relating to commitments terminated by the Company in October 1998. The balance of these fees are deferred and amortized over the related loan periods ($18.11 million and $7.48 million for the year ended December 31, 1997 and the nine months ended September 30, 1998, respectively). The deferred fees are amortized using the effective interest rate method for the term loans ($1 billion payable over 5 and $400 million over 7 years), and the straight-line method for the revolvers (364-day and 5-year). The pro forma adjustments also include periodic fees accruing on the undrawn revolvers and letters of credit, but exclude ticking fees associated with the commitments. The pro forma adjustments for the nine months also include a reversal of a $7.5 million expense recorded in the third quarter relating to the terminated commitment. This expense, related to a bridge commitment, was recorded by the Company in its historical financial statements at the time incurred. However, subsequent to that period the financing was restructured and the fee structure finalized. As a result the Company will record a reversal of $4.75 million in interest expense in the fourth quarter which represents the difference between the $7.5 million commitment fee expensed under the previous financing arrangement and the $2.75 million to be expensed under the new arrangement. For purposes of the pro forma adjustments, the fee paid in connection with the terminated commitments is deemed expensed as of January 1, 1997. (2) Represents periodic interest expense on the new debt facilities of $125.7 million and $95.4 million for the year ended December 31, 1997 and the nine months ended September 30, 1998, respectively. Interest expense on Tranche A and Tranche B of the term loan under the Senior Bank Facility is calculated based on the current LIBOR rate of 5.22% plus 2.0% and 2.75%, respectively. Interest expense on the revolving facilities is calculated based on the current LIBOR rate of 5.22% plus 2%. A 1/8% increase in the LIBOR rate results in approximately $2.1 million and $1.6 million additional interest expense for the year ended December 31, 1997 and the nine months ended September 30, 1998, respectively. Interest expense under the alternate base rate of 8.0% plus 1.2% was not used, as such values would have resulted in a higher interest expense during the period. The Company can elect to use either the LIBOR based-rate or the alternate base rate. (3) Represents the pretax impact of the pro forma adjustments to income before income taxes for the period. (4) Represents the tax benefit derived from the impact of the pro forma adjustments for the period. (5) Represents the impact on net income before accounting change (net income for the nine months ended September 30, 1998) related to the pro forma adjustments for the period. (6) Represents the reduction in Shares outstanding as a result of the purchase of Shares pursuant to the Offer. 11 AMP INCORPORATED & SUBSIDIARIES UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET DECEMBER 31, 1997
PRO FORMA PRO HISTORICAL ADJUSTMENTS FORMA ----------- ----------- ----------- (DOLLARS IN THOUSANDS) ASSETS Current Assets: Cash & cash equivalents........... $ 350,320 $ (4,750)(1) $ 345,570 Securities available for sale..... 79,350 79,350 Other current assets.............. 2,220,130 2,220,130 ----------- ----------- ----------- Total current assets............ 2,649,800 (4,750) 2,645,050 Property, plant & equipment, net.... 1,915,985 1,915,985 Investments and other assets........ 282,318 52,000 (2) 334,318 ----------- ----------- ----------- TOTAL ASSETS........................ $ 4,848,103 $ 47,250 $ 4,895,353 =========== =========== =========== LIABILITIES & SHAREHOLDERS' EQUITY Current Liabilities: Short-term debt................... $ 465,233 $ 300,000 (3) $ 765,233 Other current liabilities......... 980,063 (894)(4) 979,169 ----------- ----------- ----------- Total current liabilities....... 1,445,296 299,106 1,744,402 Long-term debt...................... 159,695 1,400,000 (3) 1,559,695 Other liabilities................... 291,577 291,577 ----------- ----------- ----------- Total Liabilities............... 1,896,568 1,699,106 3,595,674 Shareholders' Equity Common Stock...................... 81,670 979,688 (5) 1,061,358 Other Capital..................... 91,575 91,575 Deferred compensation............. (11,169) (11,169) CTA............................... 27,079 27,079 Net unrealized investment loss.... (373) (373) Retained earnings................. 2,940,488 (1,856)(6) 2,938,632 Shares held in flexitrust......... -- (979,688)(5) (979,688) Treasury stock.................... (177,735) (1,650,000)(7) (1,827,735) ----------- ----------- ----------- Total Shareholders' Equity...... 2,951,535 (1,651,856) 1,299,679 ----------- ----------- ----------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY............................. $ 4,848,103 $ 47,250 $ 4,895,353 =========== =========== =========== Book Value Per Share.............. $ 13.42 $ 6.85
12 AMP INCORPORATED & SUBSIDIARIES UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET SEPTEMBER 30, 1998
PRO FORMA PRO HISTORICAL ADJUSTMENTS FORMA ----------- ----------- ----------- (DOLLARS IN THOUSANDS) ASSETS Current Assets: Cash & cash equivalents........... $ 236,032 $ 25,000 (1) $ 261,032 Securities available for sale..... 8,141 8,141 Other current assets.............. 2,218,209 2,218,209 ----------- ---------- ----------- Total current assets............ 2,462,382 25,000 2,487,382 Property, plant & equipment, net.... 1,944,861 1,944,861 Investments and other assets........ 311,022 29,750 (2) 340,772 ----------- ---------- ----------- TOTAL ASSETS........................ $ 4,718,265 $ 54,750 $ 4,773,015 =========== ========== =========== LIABILITIES & SHAREHOLDERS' EQUITY Current Liabilities: Short-term debt................... $ 459,108 $ 300,000 (3) $ 759,108 Other current liabilities......... 907,876 1,544 (4) 909,420 ----------- ---------- ----------- Total current liabilities....... 1,366,984 301,544 1,668,528 Long-term debt...................... 170,360 1,400,000 (3) 1,570,360 Other liabilities................... 363,071 363,071 ----------- ---------- ----------- Total Liabilities............... 1,900,415 1,701,544 3,601,959 Shareholders' Equity Common Stock...................... 81,764 979,688 (5) 1,061,452 Other Capital..................... 92,694 92,694 Deferred compensation............. (20,977) (20,977) CTA............................... 47,476 47,476 Net unrealized investment loss.... (4,682) (4,682) Retained earnings................. 2,844,263 3,206 (6) 2,847,469 Shares held in flexitrust......... -- (979,688)(5) (979,688) Treasury stock.................... (222,688) (1,650,000)(7) (1,872,688) ----------- ---------- ----------- Total Shareholders' Equity...... 2,817,850 (1,646,794) 1,171,056 ----------- ---------- ----------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY............................. $ 4,718,265 $ 54,750 $ 4,773,015 =========== ========== =========== Book Value Per Share.............. $ 12.86 $ 6.19
13 NOTES TO THE SUMMARY UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEETS (1) Reflects the change in cash resulting from the proceeds under the term loan and the 364-day revolver under the Senior Bank Facility of $1,700 million, purchase of Shares pursuant to the Offer of $1,650 million and the payment of bank fees of $54.75 million. On September 29, 1998, $29.75 million of bank fees were paid of which $2.75 million will be expensed and $27 million will be deferred under the final fee structure. See note 1 to the unaudited pro forma consolidated statements of income. (2) Represents bank fees deferred relating to the Senior Bank Facility. (3) Represents the increase in short-term and long-term indebtedness resulting from the borrowings under the Senior Bank Facility. The $300 million in short-term borrowings are pursuant to the 364-day revolving credit facility and the $1,400 million in long-term borrowings is pursuant to the term loans. (4) For the December 31, 1997 pro forma condensed consolidated balance sheet, the adjustment represents the tax benefit related to the commitment fee of $2.75 million that is expensed as incurred related to the portion of the original financing commitments that was deemed no longer required by management. For the September 30, 1998 unaudited pro forma condensed consolidated balance sheet, the adjustment represents the net impact on accrued income taxes of reversing the $7.5 million commitment fee on the Bridge Loan that was eliminated in the final Senior Bank Facility and the commitment fee of $2.75 million that is expensed as incurred related to the portion of the original financing commitments that was deemed no longer required by management. See note 1 to the unaudited pro forma consolidated statements of income. (5) Reflects the formation of the Flexitrust through the issuance of 25,000,000 Shares at a market price of $39.1875 per Share by the Company to the Flexitrust in exchange for a note payable over 10 years. Both the note payable and the Flexitrust have a beginning balance of $979.7 million based on 25,000,000 Shares at $39.1875 per Share. As the note is amortized, Shares are released from the Flexitrust to fund existing employee benefit programs and compensation plans. The Company's note receivable and related interest income, as well the Flexitrust note payable and related interest expense, are not recognized in the pro forma consolidated financial statements. Shares held by the Flexitrust are excluded from basic and diluted per share calculations. (6) For the December 31, 1997 pro forma consolidated balance sheet, the adjustment represents the commitment fee of $2.75 million, net of the related tax benefit, that is expensed as incurred related to the portion of the original financing commitments that was deemed no longer required by management. For the September 30, 1998 unaudited pro forma condensed consolidated balance sheet, the adjustment represents the net impact on retained earnings of reversing the $7.5 million commitment fee on the Bridge Loan that was terminated in the final Senior Bank Facility and the commitment fee of $2.75 million that is expensed as incurred related to the portion of the original financing commitments that was deemed no longer required by management. See note 1 to the pro forma unaudited consolidated statements of income. (7) Reflects the purchase of 30,000,000 Shares at $55 per Share pursuant to the Offer. AMP Incorporated November 16, 1998 14 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 Hand: By Overnight: Reorganization Reorganization Department Reorganization Department Department 120 Broadway 85 Challenger Road, Mail P.O. Box 3301 13th Floor Drop--Reorg South Hackensack, NJ New York, NY 10271 Ridgefield Park, NJ 07660 07606 By Facsimile Transmission (for eligible institutions only): (201) 296-4293 Confirm Facsimile Transmission By Telephone Only: (201) 296-4860 Any questions or requests for assistance or for additional copies of the Offer to Purchase, this Supplement, the Letter of Transmittal or the Notice of Guaranteed Delivery may be directed to the Information Agent or the Dealer Managers at their telephone numbers and addresses set forth 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: INNISFREE M&A INCORPORATED 501 Madison Avenue, 20th Floor New York, New York 10022 Call Toll Free: (888) 750-5834 Banks & Brokers Call Collect: (212) 750-5833 The Dealer Managers for the Offer are: CREDIT SUISSE FIRST BOSTON CORPORATION DONALDSON, LUFKIN & JENRETTE Eleven Madison Avenue 277 Park Avenue New York, NY 10010-3629 New York, NY 10172 (800) 881-8320 (toll free) (877) 893-0576 (toll free) EX-99.(A)(11) 3 FORM OF LETTER OF TRANSMITTAL EXHIBIT (A)(11) LETTER OF TRANSMITTAL TO TENDER SHARES OF COMMON STOCK (INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS) OF AMP INCORPORATED PURSUANT TO THE OFFER TO PURCHASE DATED OCTOBER 9, 1998 AS AMENDED AND SUPPLEMENTED BY THE SUPPLEMENT DATED NOVEMBER 16, 1998 - ------------------------------------------------------------------------------ THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON WEDNESDAY, NOVEMBER 25, 1998, UNLESS THE OFFER IS EXTENDED. ------------------------------------------------------------------------------ CHASEMELLON SHAREHOLDER SERVICES L.L.C. By Mail: By Hand: By Overnight: Reorganization Department Reorganization Department Reorganization Department P.O. Box 3301 120 Broadway 85 Challenger Road, South Hackensack, NJ 13th Floor Mail Drop--Reorg 07606 New York, NY 10271 Ridgefield Park, NJ 07660 By Facsimile Transmission Confirm Facsimile Transmission (for eligible institutions only): By Telephone Only: (201) 296-4293 (201) 296-4860 DESCRIPTION OF SHARES TENDERED (SEE INSTRUCTIONS 2 AND 3) - --------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S) SHARES TENDERED (PLEASE FILL IN EXACTLY AS NAME(S) 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 13. 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. All Shares tendered include the associated common stock purchase rights. 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 13. If you hold your Shares through the Direct Registration System, check the appropriate box below to tender your DRS Shares: [_] Tender all Shares held through DRS. [_] Tender only Shares held through DRS. (# of Shares) If you are a participant in the Dividend Reinvestment Plan of AMP, check the appropriate box below to tender your Dividend Reinvestment Shares only: [_] Tender all Shares in my Dividend Reinvestment Account. [_] Tender only Shares in my Dividend Reinvestment Account. (# of Shares) PLEASE COMPLETE THE BOX ENTITLED "DESCRIPTION OF SHARES TENDERED" ABOVE TO TENDER ANY CERTIFICATED SHARES YOU OWN. If you are a participant in AMP's Dividend Reinvestment Plan and you have tendered to AlliedSignal any of your Shares held in your Dividend Reinvestment Account, check the following box to withdraw such Shares from the AlliedSignal tender offer. [_] See Instruction 14. Shares returned due to proration or a partial tender will not be returned by delivery of certificates representing such Shares but instead will be reissued as Direct Registration System Shares unless you check the following box to indicate that you prefer to receive certificated Shares. [_] See Instruction 15. IF YOUR SHARES ARE LOST OR MUTILATED, CHECK THIS BOX. [_] SEE INSTRUCTION 16. TO EXPEDITE REPLACEMENT OF LOST OR MUTILATED SHARES CONTACT CHASEMELLON SHAREHOLDER SERVICES L.L.C. AT ONE OF THE ADDRESSES LISTED ABOVE. NOTE: DELIVERY OF THIS LETTER OF TRANSMITTAL MUST BE MADE TO THE DEPOSITARY. 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. This Letter of Transmittal or the Letter of Transmittal previously delivered to shareholders 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") (hereinafter referred to as the "Book-Entry Transfer Facility") pursuant to the procedures set forth in Section 2 of the Offer to Purchase, as amended, (as defined below) or delivery of Shares is to be made using DRS (as defined below). THIS LETTER OF TRANSMITTAL MAY NOT BE USED FOR SHARES REFLECTING INTERESTS IN THE COMPANY'S EMPLOYEE SAVINGS AND THRIFT PLAN, AS AMENDED (THE "AMP SAVINGS PLAN"), OR THE MERIT PLAN OF BENEFITS (THE "M/A-COM SAVINGS PLAN"). SEE INSTRUCTION 12. 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, as amended by the Supplement to the Offer to Purchase, dated November 16, 1998 (the "Supplement")) must tender their Shares using the guaranteed delivery procedure set forth in Section 2 of the Offer to Purchase, as amended. See Instruction 2. 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 THE BOOK-ENTRY TRANSFER FACILITY AND COMPLETE THE FOLLOWING: Name of Tendering Institution ______________________________________________ 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. __________________________________ Account No.______________ at DTC Transaction Code No. _______________________________________________________ 3 Ladies and Gentlemen: The undersigned hereby tenders to AMP Incorporated, a Pennsylvania corporation (the "Company"), the above-described Shares of its common stock, without par value (including the associated common stock purchase rights) (the "Shares"), at a price of $55 per Share, net to the seller in cash, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated October 9, 1998 (the "Offer to Purchase"), as amended by the Supplement to the Offer to Purchase, dated November 16, 1998 (the "Supplement"), 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 the Book-Entry Transfer Facility, 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) in the case of participants in the Direct Registration System ("DRS"), to place a stop against the Shares held under DRS and, following expiration of the Offer, to instruct the transfer agent to transfer such Shares; (iii) present certificates for such Shares for cancellation and transfer on the books of the Company; and (iv) 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 hereby (i) irrevocably appoints Robert Ripp, David F. Henschel and William S. Urkiel, and each of them, and any other designees of the Company (such persons and other designees collectively, the "Proxy Designees"), the attorneys-in-fact and proxies of the undersigned, each with full power of substitution, to the full extent of the undersigned's right with respect to the Shares (or, if applicable, Rights) tendered by the undersigned and accepted for payment by the Company (and any and all other Shares or other securities or rights issued or issuable in respect of such Shares on or after October 9, 1998), (ii) irrevocably revokes any prior proxies or written consents previously given, including any written consent given with respect to any of the consent proposals submitted or to be submitted by AlliedSignal to the Company with respect to the Shares tendered by the undersigned and accepted for payment by the Company and (iii) agrees to take any actions which may be necessary to effect the foregoing. All powers of attorney and proxies effected by execution of this Letter of Transmittal will be considered irrevocable and coupled with an interest in the tendered Shares. This appointment is effective upon the acceptance for payment of Shares by the Company in accordance with the terms of the Offer to Purchase, 4 as amended. Upon acceptance for payment, all prior proxies, and any consents given by the undersigned with respect to these Shares or other securities or rights will, without further action, be revoked and no subsequent proxies may be given or written consents executed by the undersigned (and, if given or executed, will not be deemed effective) with respect to these Shares or other securities or rights. The Proxy Designees will, with respect to the Shares and other securities or rights, be empowered to exercise all voting and other rights of the undersigned as such persons, in their sole judgment, deem proper in respect of any annual or special meeting of the Company's shareholders, or any adjournment or postponement thereof, or in respect of any written consent in lieu of any meeting or revocation thereof. The undersigned understands that tenders of Shares pursuant to any one of the procedures described in Section 2 of the Offer to Purchase, as amended, 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 and the number of Shares that the undersigned wishes to tender should be indicated in the appropriate boxes on this Letter of Transmittal. The undersigned understands that upon the terms and conditions of the Offer, including its proration provisions, the Company will pay $55 net per Share, without interest (the "Purchase Price"), for Shares validly tendered and not properly withdrawn pursuant to the Offer, taking into account the number of Shares so tendered. The undersigned understands that all Shares validly tendered and not properly withdrawn will be purchased at the Purchase Price upon the terms and subject to the conditions of the Offer, including its proration provisions, and that the Company will return all other Shares, including Shares not purchased because of proration. The undersigned recognizes that, under certain circumstances set forth in the Offer to Purchase, as amended, 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 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 less any expenses including stock transfer taxes 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 10 of the Offer to Purchase, as amended. 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. 5 SPECIAL PAYMENT INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS (SEE INSTRUCTIONS 1, 5, 6 AND 7) (SEE INSTRUCTIONS 5 AND 7) To be completed ONLY if the To be completed ONLY if the check for the aggregate Purchase check for the Purchase Price of Price of Shares purchased and/or Shares purchased and/or certifi- certificates for Shares not ten- cates for Shares not tendered or dered or not purchased are to be not purchased are to be mailed to issued in the name of someone someone other than the under- other than the undersigned. signed or to the undersigned at an address other than that shown below the undersigned's signa- ture(s). Issue [_] Check and/or [_] Certificates to: Name _____________________________ Mail [_] Check and/or [_] Certificates to: __________________________________ (PLEASE PRINT) Name______________________________ Address __________________________ __________________________________ (PLEASE PRINT) __________________________________ (INCLUDE ZIP CODE) __________________________________ Address __________________________ (TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER) __________________________________ (SEE SUBSTITUTE FORM W-9 ON (INCLUDE ZIP CODE) REVERSE SIDE) 6 PLEASE SIGN HERE (TO BE COMPLETED BY ALL SHAREHOLDERS) ____________________________________________________________________________ SIGNATURE(S) OF OWNER(S) Dated ___________________________ , 199 Name(s) ____________________________________________________________________ (PLEASE PRINT) Capacity (full title) ______________________________________________________ Address ____________________________________________________________________ (INCLUDE ZIP CODE) Area Code and Telephone Number _____________________________________________ (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 5.) If a participant in the Direct Registration System ("DRS"), the person(s) signing above hereby directs the Transfer Agent to place a stop against the aforementioned number of Shares held through DRS pending expiration of the Offer. Upon expiration of the Offer, the Transfer Agent is further directed to follow the directions for delivery to the Depositary. GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 1 AND 5) Name of Firm _______________________________________________________________ Authorized Signature _______________________________________________________ Name _______________________________________________________________________ (PLEASE PRINT) Title ______________________________________________________________________ Address ____________________________________________________________________ (INCLUDE ZIP CODE) Area Code and Telephone Number _____________________________________________ Dated ___________________________ , 199 7 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 that is a recognized member of an Eligible Institution (as defined in the Offer to Purchase, as amended), 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 5. 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 2 of the Offer to Purchase, as amended, or if delivery of Shares is to be made pursuant to DRS. Certificates for all physically delivered Shares, or a confirmation of a book-entry transfer into the Depositary's account at the Book-Entry Transfer Facility of all Shares delivered electronically, as well as a properly completed and duly executed Letter of Transmittal (or manually signed facsimile thereof), with any required signature guarantees, or, in the case of a book-entry transfer, an Agent's Message (as defined in the Offer to Purchase, as amended), 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 2 of the Offer to Purchase, as amended. 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 the Book-Entry Transfer Facility 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 2 of the Offer to Purchase, as amended. 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. 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, the remainder of the Shares will be reissued as Direct Registration System Shares. See Instruction 15. All Shares represented by certificates delivered to the Depositary will be deemed to have been tendered unless otherwise indicated. 8 5. 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. 6. 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 4 of the Offer to Purchase, as amended. Except as provided in this Instruction 6, it will not be necessary to affix transfer tax stamps to the certificates representing Shares tendered hereby. 7. 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. 8. BACKUP WITHHOLDING AND SUBSTITUTE IRS FORM W-9 AND IRS FORM W-8. To prevent federal income tax backup withholding equal to 31% of the gross proceeds payable to shareholders for Shares purchased by the Company 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 (or certify that such taxpayer is awaiting a taxpayer identification number) and provide certain other information by completing, under penalties of perjury, the Substitute Internal Revenue Service ("IRS") Form W-9 included with this Letter of Transmittal. Certain shareholders 9 (including all corporations and certain foreign shareholders) are exempt from backup withholding. In order for a foreign shareholder to qualify as an exempt recipient, that shareholder must submit an IRS Form W-8 signed under penalties of perjury, attesting to that person's exempt status. An IRS Form W-8 can be obtained from the Depositary. 9. 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 proceeds payable to a foreign shareholder or its 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, or any State or any political subdivision thereof, (iii) an estate the income of which is subject to United States federal income taxation regardless of source or (iv) a trust if a United States court is able to exercise primary supervision over the administration of such trust and one or more United States persons have the authority to control all substantial decisions of such trust. 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 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 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 13 of the Offer to Purchase, as amended, 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. 10. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Any questions or requests for assistance may be directed to the Information Agent or the Dealer Managers at their respective telephone numbers and addresses listed below. Requests for additional copies of the Offer to Purchase, as amended, this Letter of Transmittal or other tender offer materials may be directed to the Information Agent or the Dealer Managers, 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. 11. 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 Managers, 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. 12. SAVINGS PLAN; RESTRICTED SHARES. Participants in either the AMP Savings Plan or the M/A-COM Savings Plan may not use this Letter of Transmittal to direct the tender of Shares attributable to their individual accounts, but must use the Direction Form previously sent to them. Participants in the AMP Savings Plan and the M/A-COM Savings Plan are urged to carefully read the Direction Form and related materials previously sent to them. Restricted Shares (as defined in the Offer to Purchase, as amended) may not be tendered pursuant to the Offer until the applicable restriction period has expired. See Section 2 of the Offer to Purchase, as amended. 10 13. ORDER OF PURCHASE IN EVENT OF PRORATION. As described in Section 1 of the Offer to Purchase, as amended, shareholders may designate the order in which their Shares are to be purchased in the event of proration. The order of purchase may have an effect on 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 13 of the Offer to Purchase, as amended. 14. WITHDRAWAL OF SHARES TENDERED PURSUANT TO AN ALLIEDSIGNAL TENDER OFFER. Shareholders who desire to tender their Shares pursuant to this Offer but who have tendered their Shares pursuant to a tender offer made by AlliedSignal must effect a timely withdrawal of their Shares from such offer. Such withdrawal must comply with all of the requirements for withdrawal enumerated in the relevant AlliedSignal offer. A Notice of Withdrawal form which may be used by shareholders to withdraw Shares that have previously been tendered to AlliedSignal may be obtained from the Information Agent. 15. DIRECT REGISTRATION SYSTEM SHARES. Unless the person signing this Letter of Transmittal indicates a preference to receive certificated Shares by checking the appropriate box on this Letter of Transmittal, any Shares tendered pursuant to the Offer but returned due to proration will not be returned by delivery of certificates representing such Shares but instead will be registered to the shareholder as Direct Registration System Shares. Direct Registration System Shares are Shares which are registered to the shareholder by the Company's transfer agent in book-entry form without issuing Share certificates to the shareholder. Shareholders holding Shares through the Direct Registration System will receive an advice form indicating the number of Shares registered to the shareholder by the Company's transfer agent in book-entry form. Shareholders may transfer Direct Registration System Shares by contacting the Company's transfer agent. Shareholders may also contact the Company's transfer agent to have Direct Registration System Shares reissued to the shareholder in certificated form. 16. LOST OR MUTILATED SHARES. If you have lost or mutilated Shares you may have to execute an affidavit of loss and post a bond of indemnity. Please contact ChaseMellon Shareholder Services L.L.C. at any of the addresses listed on the front page of this Letter of Transmittal for additional instructions for replacing such Shares. In order to make a valid tender, Shares must be delivered to the Depositary. 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. 11 PAYOR'S NAME: CHASEMELLON SHAREHOLDERS SERVICES L.L.C. - -------------------------------------------------------------------------------- PART 1--PLEASE PROVIDE YOUR Social Security Number TIN IN THE BOX AT RIGHT AND or CERTIFY BY SIGNING AND Employer Identification DATING BELOW. Number SUBSTITUTE FORM W-9 DEPARTMENT OF THE TREASURY ---------------------- INTERNAL -------------------------------------------------------- REVENUE SERVICE PART 2: For Payees exempt from backup PART 3: withholding, see the enclosed Guide- lines for Certification of Taxpayer Awaiting Identification Number on Substitute TIN [_] Form W-9 and complete as instructed therein. -------------------------------------------------------- CERTIFICATION--Under the penalties of perjury, I cer- tify that (i) the number shown on this form is my correct Taxpayer Identification Number (or I am wait- ing 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 re- sult of a failure to report all interest or divi- dends; 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 cur- rently subject to backup withholding because of underreporting interest or dividends on your tax re- turn. PAYER'S REQUEST FOR TAXPAYER IDENTIFICATION NUMBER (TIN) SIGNATURE ____________________________________________ DATE _________________________________________________ NAME _________________________________________________ (PLEASE PRINT) ADDRESS ______________________________________________ ______________________________________________________ (INCLUDE ZIP CODE) - ------------------------------------------------------------------------------- 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. 12 The Information Agent for the Offer is: INNISFREE M&A INCORPORATED 501 MADISON AVENUE, 20TH FLOOR NEW YORK, NEW YORK 10022 CALL TOLL FREE: (888) 750-5834 BANKS & BROKERS CALL COLLECT: (212) 750-5833 The Dealer Managers for the Offer are: CREDIT SUISSE FIRST BOSTON CORPORATION DONALDSON, LUFKIN & JENRETTE Eleven Madison Avenue 277 Park Avenue New York, NY 10010 New York, NY 10172 (800) 881-8320 (toll free) (877) 893-0576 (toll free) EX-99.(A)(12) 4 FORM OF NOTICE OF GUARANTEED DELIVERY EXHIBIT (A)(12) AMP INCORPORATED 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 AMP Incorporated 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, as amended (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 2 of the Offer to Purchase, as amended. THE ELIGIBLE INSTITUTION WHICH 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 Hand: By Overnight: Reorganization Reorganization Reorganization Department Department Department P.O. Box 3301 120 Broadway--13th Floor 85 Challenger Road, South Hackensack, NJ New York, New York 10271 Mail Drop-Reorg 07606 Ridgefield Park, NJ 07660 By Facsimile Transmission: (201) 296-4293 Confirm Receipt of Notice of Guaranteed Delivery by Telephone: (201) 296-4860 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. Ladies and Gentlemen: The undersigned hereby tenders to AMP Incorporated, a Pennsylvania corporation (the "Company"), upon the terms and subject to the conditions set forth in the Offer to Purchase, dated October 9, 1998 (the "Offer to Purchase"), as amended by the Supplement to the Offer to Purchase, dated November 16, 1998, 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, without par value (including the associated common stock purchase rights) (the "Shares") of the Company listed below, pursuant to the guaranteed delivery procedure set forth in Section 2 of the Offer to Purchase, as amended. 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 10 of the Offer to Purchase, as amended. Number of Shares: - ------------------------------------- ------------------------------------- Name(s) (Please Print) Certificate Nos.: (if available) - ------------------------------------- ------------------------------------- - ------------------------------------- ------------------------------------- If Shares will be tendered by book- (Address) entry transfer: Name of Tendering Institution: ------------------------------------- Area Code and Telephone Number - ------------------------------------- ------------------------------------- Account No. ______________________ at Signature(s) [_] The Depository Trust Company 2 GUARANTEE (NOT TO BE USED FOR SIGNATURE GUARANTEE) The undersigned, a firm that is a member of a registered national securities exchange or the National Association of Securities Dealers, Inc. or a commercial bank, trust company or savings and loan association that is a participant in good standing in the Security Transfer Agent's Medallion Program, the New York Stock Exchange, Inc. Medallion Signature Program or the Stock Exchange Medallion Program (each an "Eligible Institution") having an office, branch or agency in the United States 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 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 - ------------------------------------- ------------------------------------- Area Code and Telephone Number Title Dated: ________________________ , 199 DO NOT SEND SHARE CERTIFICATES WITH THIS FORM. YOUR SHARE CERTIFICATES MUST BE SENT WITH THE LETTER OF TRANSMITTAL. 3 EX-99.(A)(13) 5 FORM OF LETTER TO BROKERS, DEALERS EXHIBIT (A)(13) SUPPLEMENT TO THE OFFER TO PURCHASE FOR CASH BY AMP INCORPORATED OF UP TO 30,000,000 SHARES OF ITS COMMON STOCK (INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS) AT $55 NET PER SHARE DATED OCTOBER 9, 1998 THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON WEDNESDAY, NOVEMBER 25, 1998, UNLESS THE OFFER IS EXTENDED. November 16, 1998 To Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees: In our capacity as Dealer Managers, we are enclosing the material listed below relating to the offer of AMP Incorporated, a Pennsylvania corporation (the "Company"), to purchase up to 30,000,000 shares of its common stock, without par value (including the associated common stock purchase rights) (the "Shares"), at $55 per Share, net to the seller in cash, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated October 9, 1998 (the "Offer to Purchase"), as amended by the Supplement to the Offer to Purchase, dated November 16, 1998 (the "Supplement"), and in the related Letter of Transmittal (which, as amended from time to time, together constitute 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 10 of the Offer to Purchase, as amended. THE OFFER IS NOT CONDITIONED ON ANY MINIMUM NUMBER OF SHARES BEING TENDERED. THE OFFER IS, HOWEVER, SUBJECT TO CERTAIN OTHER CONDITIONS INCLUDING THE COMPANY'S HAVING OBTAINED SUFFICIENT FINANCING FOR THE PURCHASE OF SHARES AND ALL CONDITIONS TO SUCH FINANCING, OTHER THAN THE PURCHASE OF SHARES PURSUANT TO THE OFFER, BEING SATISFIED ON OR PRIOR TO THE EXPIRATION DATE OF THE OFFER. SEE SECTIONS 5 AND 9 OF THE OFFER TO PURCHASE, AS AMENDED. 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 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 Supplement. 2. The Letter of Transmittal for your use and for the information of your clients. 3. 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, as amended). 4. 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. 5. 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. WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON WEDNESDAY, NOVEMBER 25, 1998, 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 Managers). 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 6 of the Letter of Transmittal. In order to take advantage of the Offer, a duly executed and properly completed Letter of Transmittal (or facsimile thereof), with any required signature guarantees, or an Agent's Message (as defined in the Offer to Purchase, as amended) in connection with a book-entry transfer of Shares, and any other required documents, should be sent to the Depositary, and certificates representing the tendered Shares should be delivered or such Shares should be tendered by book-entry transfer, all in accordance with the Instructions set forth in the Letter of Transmittal and in the Offer to Purchase, as amended. If holders of Shares wish to tender, but it is impracticable for them to forward their certificates or other required documents or to complete the procedures for delivery by book-entry transfer prior to the expiration of the Offer, a tender may be effected by following the guaranteed delivery procedures specified in "Section 2. Procedure for Tendering Shares" in the Offer to Purchase, as amended. 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. NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO ANY SHAREHOLDER AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING SHARES. Any questions or requests for assistance or additional copies of the enclosed materials may be directed to the Information Agent or the Dealer Managers at their respective addresses and telephone numbers set forth on the back cover of the enclosed Supplement. Very truly yours, Credit Suisse First Boston Corporation Donaldson, Lufkin & Jenrette Securities Corporation NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY OTHER PERSON THE AGENT OF THE COMPANY, THE DEALER MANAGERS, 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. 2 EX-99.(A)(14) 6 FORM OF LETTER TO CLIENTS FOR USE BY BROKER, DEALER EXHIBIT (A)(14) SUPPLEMENT TO THE OFFER TO PURCHASE FOR CASH BY AMP INCORPORATED OF UP TO 30,000,000 SHARES OF ITS COMMON STOCK (INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS) AT $55 NET PER SHARE DATED OCTOBER 9, 1998 THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON WEDNESDAY, NOVEMBER 25, 1998, UNLESS THE OFFER IS EXTENDED. November 16, 1998 To Our Clients: Enclosed for your consideration are the Supplement, dated November 16, 1998 (the "Supplement") to the Offer to Purchase, dated October 9, 1998 (the "Offer to Purchase"), and the related Letter of Transmittal (which, as amended from time to time, and together with the Offer to Purchase constitute the "Offer") setting forth an offer by AMP Incorporated, a Pennsylvania corporation (the "Company"), to purchase up to 30,000,000 shares of its common stock, without par value (including the associated common stock purchase rights) (the "Shares"), at $55 per Share, net to the seller in cash, upon the terms and subject to the conditions of the Offer. The Company will pay $55 per Share (the "Purchase Price") for up to 30,000,000 Shares validly tendered pursuant to the Offer and not properly withdrawn, upon the terms and subject to the conditions of the Offer, including the provisions relating to proration described in "Section 1. Number of Shares; Proration" of the Offer to Purchase, as amended. The Purchase Price will be paid in cash, net to the seller, with respect to all Shares purchased. Shares tendered and not purchased because of proration or invalid tender will be returned to 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 10 of the Offer to Purchase, as amended. 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, as amended, and the Letter of Transmittal. Your attention is invited to the following: 1. The offer price is $55 per Share, net to you in cash. 2. The Offer is for up to 30,000,000 Shares, constituting approximately 13.71% of the total Shares outstanding as of October 7, 1998 (excluding presently exercisable options and the 25 million Shares sold to AMP's flexible employee trust). 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, as amended. 3. The Offer, proration period and withdrawal rights will expire at 12:00 Midnight, New York City time, on Wednesday, November 25, 1998, 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, as amended, if more than 30,000,000 Shares have been validly tendered and not properly withdrawn prior to the Expiration Date, as defined in Section 1 of the Offer to Purchase, as amended, the Company will purchase Shares on a pro rata basis. See Section 1 of the Offer to Purchase, as amended, for a discussion of proration. 5. Tendering shareholders will not be obligated to pay any brokerage commissions or solicitation fees to the Company, the Dealer Managers or the Information Agent 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 6 of the Letter of Transmittal. 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. NEITHER THE COMPANY NOR ITS BOARD OF DIRECTORS MAKES ANY RECOMMENDATION TO ANY SHAREHOLDER AS TO WHETHER TO TENDER OR REFRAIN FROM TENDERING SHARES. 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, as amended, 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. 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 Managers or one or more registered brokers or dealers licensed under the laws of such jurisdiction. 2 INSTRUCTION FORM WITH RESPECT TO OFFER TO PURCHASE FOR CASH UP TO 30,000,000 SHARES OF COMMON STOCK OF AMP INCORPORATED AT $55 NET PER SHARE The undersigned acknowledge(s) receipt of your letter and the enclosed Supplement, dated November 16, 1998 (the "Supplement") to the Offer to Purchase, dated October 9, 1998, and the related Letter of Transmittal (which, as amended from time to time, and together with the Offer to Purchase constitute the "Offer") in connection with the Offer by AMP Incorporated (the "Company") to purchase up to 30,000,000 shares of its common stock, without par value (the "Shares"), at a purchase price of $55 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 acknowledges 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 10 of the Offer to Purchase, as amended. 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, upon the terms and subject to the conditions of the Offer. - ------------------------------------------------------------------------------- Number of Shares to be Tendered:* Shares ------------------------------------------------------------------------------ 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) ------------------------------------- Print Name(s) ------------------------------------- ------------------------------------- Address(es) ------------------------------------- Area Code and Telephone Number ------------------------------------- Social Security or Taxpayer ID No. Dated: , 199 - -------- * Unless otherwise indicated, it will be assumed that all Shares held by us for your account are to be tendered. -----END PRIVACY-ENHANCED MESSAGE-----