UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K
(Mark One)

[X ] Annual Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 [Fee Required]

For the fiscal year ended December 31, 1993
or
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 [No Fee Required]

For the transition period from to
___________ ___________

Commission File Number 1-7418
______

ESSEX GROUP, INC.
______________________________________________________
(Exact name of registrant as specified in its charter)

MICHIGAN 35-1313928
__________________________________________________________________________
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

1601 WALL STREET, FORT WAYNE, INDIANA 46802
__________________________________________________________________________
(Address of principal executive offices) (Zip Code)

Registrant's telephone number: (219) 461-4000

Securities registered pursuant to Section 12(b) of the Act:

Name of each exchange on
Title of each class which registered

10% Senior Notes due 2003 Pacific Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:

None
__________________________________________________________________________
(Title of class)

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained,
to the best of the registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-K or any amendment to this Form 10-K. [X]

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that
the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.

[X ] Yes [ ] No

No voting stock is held by non-affiliates of the registrant.

As of February 28, 1994 the registrant had outstanding 100 shares of $.01
Par Value Common Stock.

The registrant does not have a class of equity securities registered
pursuant to Section 12 of the Securities Exchange Act of 1934.

DOCUMENTS INCORPORATED BY REFERENCE - None

PART I

Item 1. Business

General

Essex Group, Inc. (the "Company") develops, manufactures and markets
electrical wire and cable and electrical insulation products. Among the
Company's products are magnet wire for electromechanical devices such as
motors, transformers and electrical controls; building wire for the
construction industry; telephone cable for the telecommunications
industry; wire for automotive and industrial applications; and insulation
products for the electrical industry. The Company's operations at
December 31, 1993 included 26 domestic manufacturing facilities and
employed approximately 3,755 persons.

The Company was founded in Detroit, Michigan in 1930 to manufacture
electrical wire harnesses for automobiles exclusively for the Ford Motor
Company. United Technologies Corporation ("UTC") acquired the Company in
1974 and operated it as a wholly-owned subsidiary. On February 29, 1988,
MS/Essex Holdings Inc. ("Holdings"), acquired the Company from UTC (the
"1988 Acquisition"). After the 1988 Acquisition, the outstanding common
stock of Holdings was beneficially owned by the Morgan Stanley Leveraged
Equity Fund II, L.P., certain directors and members of management of
Holdings and the Company, and others.

Product Lines

The Company's wire products include magnet wire for electromechanical
devices such as motors, transformers and electrical controls; building
wire; telecommunication cable; and various types of automotive and
industrial wires for applications in automobiles, trucks, appliances and
construction. Insulation products include mica paper and mica-based
composites laminated with glass, fabric and synthetic films, in
combination with various proprietary or purchased polymers.

The following table sets forth for each of the three years in the period
ended December 31, 1993 the dollar amounts and percentages of sales of
each of the Company's major product lines and identifies the division
(defined below) with which each line is associated:

Sales Percentage of Sales
--------------------------- -----------------------
1993 1992 1991 1993 1992 1991
------ ------ ------ ------ ------ ------
(In millions)

Building wire (WCD) $332.2 $374.6 $387.0(a) 38% 41% 44%
Magnet wire (MWI) 240.9 230.3 221.4 28 25 25
Telecommunication cable (TPD) 135.9 154.0 162.8 16 17 18
Automotive & appliance wire (EPD) 114.0 108.3(b) 71.2 13 12 8
Insulation products (MWI) 43.7 40.1 41.8 5 5 5
Other 2.1 2.1 1.3 --(c) --(c) --(c)
------ ------ ------ ----- ----- -----

Total $868.8 $909.4 $885.5 100% 100% 100%
====== ====== ====== ===== ===== =====

(a) Includes $32.6 million in sales of an industrial wire product line
transferred to EPD effective January 1992.

(b) Includes $32.7 million in sales of an industrial wire product line;
sales of that product line were reported as WCD sales in prior years.

Division Operations

The Company classifies its operations into four major divisions based on
the markets served: Wire and Cable Division ("WCD"); Magnet Wire and
Insulation Division ("MWI"); Telecommunication Products Division ("TPD")
and Engineered Products Division ("EPD"). A summary of the business of
each major division is set forth below.

Wire and Cable Division

Products. WCD develops, manufactures and markets a complete line of
building wire and other related wire products. Specific examples include
service entrance cable, underground feeder wire and nonmetallic wire and
cable for the residential market and a variety of insulated wires for the
nonresidential market. The ultimate end users are electrical contractors
and "do-it-yourself" consumers.

Sales and Marketing. WCD has produced building wire and cable in the
United States since 1933. WCD has developed and maintained a large and
diverse customer base, selling primarily to electrical distributors,
hardware wholesalers and consumer product retailers. WCD's products are
marketed nationally through manufacturers representatives and a Company
sales force. WCD has distribution facilities throughout the United States
and one in Canada.

Historically, approximately 65% of the Company's building wire market is
attributable to remodeling and repair activity while the remaining 35% is
attributable to new residential and nonresidential construction.

Magnet Wire and Insulation Division

Products. MWI develops and manufactures magnet wire and insulation
products for the electrical equipment and electronics industries in the
United States. MWI offers a comprehensive line of insulation and magnet
wire products, including over 500 types of magnet wire used in a wide
variety of motors, coils, relays, generators, solenoids and transformers.

Sales and Marketing. Historically, 66% of MWI sales have been made
directly to end users and 34% of sales have been to distributors. The
Company distributes electrical insulating materials and certain appliance
and magnet wire products through its IWI distribution chain ("IWI"). IWI
is a national distributor providing the Company access to small original
equipment manufacturers and motor repair markets.

In response to a growing number of Japanese transplant businesses that
supply products to Japanese automobile companies with United States
manufacturing operations, the Company established a joint venture with The
Furukawa Electric Company, LTD., Tokyo, Japan ("Femco") in 1988. In the
second quarter of 1993, the Company completed construction of a new
manufacturing facility that is occupied by both the Company and Femco.
Femco manufactures and markets magnet wire with special emphasis on
products required by Japanese manufacturers for their production
facilities in the United States.

Telecommunication Products Division

Products. TPD develops, manufactures and markets a broad line of plastic
insulated conductor and plastic jacketed telephone cables primarily for
use in the United States telephone network, although it is expanding its
capability to manufacture products for overseas markets. TPD manufactures
polyolefin, PVC, and fluoropolymer insulated cable of various types as
well as specialized cables adapted to customer requirements. New product
design and materials development activities are supported by TPD's Product
Development and Materials Engineering Laboratory.

Sales and Marketing. TPD sells products to regional Bell operating
companies, many smaller domestic telephone companies and to telephone
companies and private contractors overseas. Competition is based
primarily on price, with service and product quality important, but
secondary, considerations.

Engineered Products Division

Products. EPD develops, manufactures and distributes automotive primary
wire, ignition wire, battery cable, flexible cordage, motor lead wire,
submersible pump cables and welding cable. Automotive products are sold
primarily to suppliers of automotive original equipment, while industrial
wire and cable products are sold to appliance and power tool
manufacturers. A recent acquisition has expanded EPD's product offering
with the addition of specialty wiring assemblies including heavy truck
harnesses and automotive ignition wire assemblies. See "Business--
Business Development."

Sales and Marketing. EPD has one principal customer. See Significant
Customer below. Considerable progress has been made, however, to broaden
its automotive customer base. To this end, the Company has retained an
independent sales organization, located in the Detroit, MI area that

provides EPD with the local presence necessary to attract and service new
customers in the automotive wire market. Sales representatives from MWI
and WCD also call on and service many of the division's other original
equipment manufacturer customers. EPD has been recognized as a technology
leader in the automotive wire and cable industry by two major customers.
This has led to increased business with these customers and has helped EPD
obtain significant new business from other customers. The principal
customer of EPD continues to be serviced by a dedicated sales
representative who is a Company employee.

Significant Customer. UTC's Automotive Group is the principal customer
for EPD's automotive wire, generating approximately 40% of EPD's revenues
in 1993. This percent has declined from previous years, when the
proportion was as high as 60%, principally through developing a broader
customer base; a strategy which is expected to continue. In the event
this customer were to cease buying the Company's products, the Company
believes EPD could be adversely impacted. However, the Company further
believes that if this event were to occur it would market to other
customers and any underutilized equipment could be altered to produce
other wire products at a reasonable cost and in a reasonable period of
time.

Business Development

The Company has established plans to increase sales across many of its
product lines by expanding product offerings within compatible markets,
targeting new global markets for existing products and expanding
penetration in those overseas markets where a presence has already been
established. To accomplish this objective, the Company expects to make
business acquisitions and capital investments in new plant and equipment
as necessary in the United States and intends to pursue select investments
in strategic partners and participate in joint ventures off-shore. A
senior executive has been appointed to direct new business development and
international activities for the Company.

In the second quarter of 1993 the Company completed construction of a new
magnet wire manufacturing facility, a portion of which is leased to Femco.
Femco manufactures and markets magnet wire with special emphasis on
products required by Japanese manufacturers for their production
facilities in the United States. In addition to an expanded presence in
Japanese transplant markets, the Company also expects to benefit from the
Femco joint venture through application of new production methods, product
improvement and production efficiencies which, in turn, should have
application to other Company Magnet Wire and Insulation Division
production facilities. See "Division Operations--Magnet Wire and
Insulation." In the fourth quarter of 1993 the Company completed the
acquisition of a Mississippi based company which provides an entry into
specialty wiring assemblies including heavy truck harnesses and automotive
ignition wire assemblies. See "Management's Discussion and Analysis of
Results of Operations and Financial Condition -- Liquidity, Capital
Resources and Financial Condition." Also during 1993, the Company made an
equity investment in a major Mexican wire producer to establish an
investment presence in the Latin American wire markets.

Manufacturing Strategy

The Company's manufacturing strategy is primarily focused on maximizing
product quality and optimizing production efficiencies. The Company has

achieved a high level of vertical integration through internal production
of its principal raw materials: copper rod, enamels and resin compounds.
The Company believes one of its primary cost advantages in the magnet wire
business is its ability to produce most of its enamel requirements
internally. Similarly, the Company believes its ability to develop and
produce PVC and rubber compounds, which are used as insulation and
jacketing materials for many of its building wire, telecommunication,
automotive and industrial wire products, provides cost advantages because
the process achieves greater control over the cost and quality of
essential components used in production. These operations are supported
by the Company's metallurgical, chemical and polymer development
laboratories.

To further optimize production efficiencies, the Company invests in new
plants and equipment, pursues plant rationalizations, and participates in
joint venture opportunities. In the period 1988 through 1991, the Company
spent an average of $13.4 million per year for capital projects. In 1992
and 1993, the Company made capital expenditures of approximately $31.2
million and $26.2 million, respectively. Company management has continued
to identify opportunities to improve the efficiency of its manufacturing
facilities and has employed rationalization efforts to accomplish those
improvements.

Manufacturing Process

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

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

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

Bunching. Bunching is the process of twisting together single wire
strands to form a concentric construction ranging from seven to over 200
strands. The major purpose of bunching is to provide improved flexibility
while maintaining current carrying capacity. For some applications (for
example, automotive uses), the final wire must be concentric, requiring
accurate control of the bare wire's mechanical properties, tension, and
diameter. In other applications, such as building wire, different
diameters are used within the single conductors to produce a round wire.

Insulating. The magnet wire insulating materials (enamels) manufactured
by the Company's chemical processing facility are polymeric materials
produced by one of two methods. One method involves the blending of

commercial resins which are dissolved in various solvents and then
modified with catalysts, pigments, cross-linking agents and dyes. The
other method involves building polymer resins to desired molecular weights
in reactor systems.

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

Most other wire products are insulated with plastic or rubber compounds
through an extrusion process. Extrusion involves the feeding, melting and
pumping of a compound through a die to shape it into final form as it is
applied to the wire. The Company has the capability to manufacture both
rubber and PVC jacketing and insulating compounds, which are then extruded
onto wire.

In order to enhance the insulation properties of certain products, the
polymers can be cross-linked chemically or by radiation after the
extrusion process. Extensive chemical cross-linking capability exists
within certain of the Company's facilities. In addition, an electron beam
radiation facility is utilized at the Lafayette, Indiana plant.

Once the wire is fabricated, it is packaged and shipped to regional
warehouses, distributors or directly to customers.

Metals Operations

Although the Company classifies its business into four principal
divisions (see "Division Operations" above) the metals operations, due to
cost efficiencies, are centrally organized. Copper is the critical
component of the Company's overall cost structure, comprising
approximately 50% of the Company's 1993 total production cost of sales.
Through centralization, the Company carefully manages its copper
procurement, internal distribution, manufacturing and scrap recycling
processes.

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

Copper Procurement

The Company centralizes its copper purchases. In 1993 the Company bought
approximately 225,000 tons of copper. North American copper producers and
metals merchants accounted for approximately 98% of such purchases.

Under producer contracts, the Company commits to take a specified tonnage
per month. Most producer contracts have a one-year term. Pricing
provisions vary, but they are based on the New York Commodity Exchange,
Inc. ("COMEX") price plus a premium. Under merchant contracts, prices are
also based on the COMEX price plus a premium. Payment terms are
negotiated.

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

Copper Rod Production

The production of copper rod is an essential part of the Company's
manufacturing process. Through vertical integration, the Company's
ability to manufacture rod provides greater control over the cost and
quality of an essential component used in producing most of the Company's
products. Approximately 80% of the Company's rod requirements are
provided internally, with the balance purchased from external sources.
External rod purchases are used to cover rod requirements beyond the
Company's capacity to produce and for rod requirements at manufacturing
locations where shipping Company-produced rod is not cost effective. The
Company currently has four rod production facilities which are
strategically located near its major wire producing plants to minimize
freight costs. During the third quarter of 1994, the Company expects to
commence production at a fifth continuous casting unit to further supply
its rod requirements and reduce costs.

Copper rod is manufactured by a continuous casting process where high
quality copper cathodes are melted in a shaft furnace. The molten copper
is transferred to a holding furnace and siphoned directly onto a casting
wheel where it is cooled and subsequently rolled into copper rod. The rod
is subjected to quality control tests to determine that it meets the high
quality standards of the Company's products. Numerous other quality tests
are performed throughout the process to determine rod characteristic and
provide proper utilization of rod by plants requiring specific processing
requirements. Finally, the rod is packaged for shipment via an automatic
in-line coiling packaging device.

Copper Scrap Reclamation

The Company's Metals Processing Center receives scrap from a majority of
the Company's plants. Copper scrap is processed in rotary furnaces, which
also have refining capability to remove impurities. A casting process is
employed to manufacture copper rod from scrap material. This continuous
casting process is unique in the industry in the conversion of scrap
directly into rod. Manufacturing cost economies, particularly in the form
of energy savings, result from the Company's direct production technique.
Additionally, management believes that internal reclamation of scrap
copper provides greater control over the cost to recover the Company's
principal manufacturing by-product. The Company also obtains scrap from
other copper wire producers in exchange for cathodes and processes it
along with the internal scrap.

Exports

Sales of exported goods approximated $70.6 million, $75.5 million, and
$40.8 million for the years ended December 31, 1993, 1992, and 1991,
respectively. TPD is the Company's primary exporting division.

Backlog

The Company has no significant order backlog in that it follows the
industry practice of producing its products on an ongoing basis to meet
customer demand without significant delay. The Company believes the
ability to supply orders in a timely fashion is a competitive factor in
the markets in which it operates.

Competition

In each of the Company's operating divisions, the Company experiences
competition from at least one major competitor. However, due to the
diversity of the Company's product lines as a whole, no single competitor
competes with the Company across the entire spectrum of the Company's
product lines. Many of the Company's products are made to industry
specifications, and are therefore essentially fungible with those of
competitors. Accordingly, the Company is subject in many markets to
competition on the basis of price, delivery time, customer service and
ability to meet specialty needs. The Company believes it enjoys strong
customer relations resulting from its long participation in the industry,
its emphasis on customer service, its commitment to quality control,
reliability, and its substantial production resources. The Company's
distribution networks enable it to compete effectively with respect to
delivery time. From time to time the Company has experienced reduced
margins in certain markets due to price cutting by competitors.

Employees

As of December 31, 1993, the Company employed approximately 1,280
salaried and 2,475 hourly employees in 33 states. Labor unions represent
approximately 50% of the Company's work force. Collective bargaining
agreements expire at various times between 1994 and 1999. Contracts
covering approximately 26% of the Company's unionized work force will
expire at various times during the remainder of 1994. The Company
believes that it will be able to renegotiate its contracts covering such
unionized employees on terms that will not be materially adverse to it,
however, no assurance can be given to that effect. The Company believes
its relations with both unionized and nonunionized employees have been
good.

Item 2. Properties

At December 31, 1993 the Company operated 26 manufacturing facilities in
12 states. Except as indicated below, all of the facilities are owned by
the Company or its subsidiaries. The Company believes its facilities and
equipment are reasonably suited to its needs and are properly maintained
and adequately insured.

The following table sets forth certain information with respect to the
manufacturing facilities of the Company at December 31, 1993:

Square
Operation Location Feet
--------- -------- ------

Engineered Products . . . . . . Kosciusko, MS 90,000(a)
Lafayette, IN 350,000
Lexington, MS 43,000
Marion, IN 254,000 (Leased)
Marion, IN 50,000
Orleans, IN 425,000
Pana, IL 110,000

Magnet Wire . . . . . . . . . . Charlotte, NC 26,000 (Leased)
Fort Wayne, IN 181,000
Franklin, IN 35,000(b)
Franklin, TN 289,000 (Leased)
Kendallville, IN 88,000
Rockford, IL 319,000
Vincennes, IN 267,000

Insulation . . . . . . . . . . Newmarket, NH 132,000
(2 facilities)
Rutland, VT 61,000

Metals Processing . . . . . . . Columbia City, IN 75,000
Jonesboro, IN 56,000

Telecommunication Products . . Chester, SC 218,000
Hoisington, KS 239,000

Wire and Cable . . . . . . . . Anaheim, CA 174,000
Columbia City, IN 400,000
Lithonia, GA 144,000
Pauline, KS 501,000
Tiffin, OH 260,000

(a) Approximately 30,000 square feet of the Kosciusko, MS facility is
leased.

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

In addition to the facilities described in the table above, the Company
owns or leases 26 warehouses throughout the United States, plus one in
Canada to facilitate the sale and distribution of its products. The
Company owns and maintains executive and administrative offices in Fort
Wayne, Indiana.

The Company believes its plants are generally adequate to service the
requirements of its customers. Overall, the Company's plants are utilized
to a substantial, but not full degree. The extent of current utilization
is generally consistent with historical patterns, and, in the view of the
Company, is satisfactory. The Company does not view any of its plants as
being substantially underutilized. Most plants operate on schedules of no

less than three eight hour shifts, five days a week. During 1993, the
Company's facilities operated overall at approximately 93% of capacity,
with MWI at 93%, EPD at 77%, TPD at 95% and WCD at 95% of capacity.

The property in Franklin, Indiana is a magnet wire manufacturing facility
occupied by both the Company and Femco. Half of the Franklin, Indiana
building is leased to Femco which was established in 1988 as a joint
venture between the Company and The Furukawa Electric Company, LTD.,
Tokyo, Japan. Femco manufactures and markets magnet wire with special
emphasis on products required by Japanese manufacturers with production
facilities in the United States. See Division Operations--Magnet Wire and
Insulation and "Management's Discussion and Analysis of Results of
Operations and Financial Condition Liquidity, Capital Resources and
Financial Condition."

Item 3. Legal Proceedings

Legal and Environmental Matters

The Company is engaged in certain routine litigation arising in the
ordinary course of business. The Company does not believe that the
adverse determination of any pending litigation, either singly or in the
aggregate, would have a material adverse effect upon its business,
financial condition or results of operations.

Potential environmental liability to the Company arises from both on-site
contamination by, and off-site disposal of, hazardous substances. On-site
contamination at certain Company facilities is the result of historic
disposal activities, including activities attributable to Company
operations and those occurring prior to the use of a facility site by the
Company. Off-site liability would include cleanup responsibilities at
various sites to be remedied under federal or state statutes for which the
Company has been identified by the United States Environmental Protection
Agency (the "EPA") (or the equivalent state agency) as a Potentially
Responsible Party ("PRP").

The Company has been named in government proceedings which involve
environmental matters with potential remediation costs and, in certain
instances, sanctions. Once the Company has been named as a PRP, it
estimates the extent of its potential liability based upon, among other
things, the number of other identified PRPs and the relative contribution
of Company waste at the site. Nevertheless, the Company believes that,
except as described in the next succeeding paragraph and subject to the
$4.0 million "basket" described below and one other identified site, it
will not bear the cost of investigation and cleanup at any of these sites
because, pursuant to the Stock Purchase Agreement dated January 15, 1988
(the "1988 Acquisition Agreement") covering the 1988 Acquisition, UTC
agreed to indemnify the Company against all losses, as defined in the 1988
Acquisition Agreement, incurred under any environmental protection and
pollution control laws or resulting from or in connection with damage or
pollution to the environment, and arising from events, operations or
activities of the Company prior to February 29, 1988 or from conditions or
circumstances existing at or prior to February 29, 1988. Except for
certain matters relating to permit compliance, the Company believes that
it is fully indemnified with respect to conditions, events and
circumstances known to UTC prior to February 29, 1988, i.e., matters
referred to in documents which were in UTC's possession, custody or
control prior to the 1988 Acquisition or matters identified to UTC through

the due diligence of Holdings. Further, the Company is indemnified,
subject to a $4.0 million "basket" (the "Basket"), for losses related to
any environmental events, conditions, or circumstances identified prior to
February 28, 1993 to the extent such losses are not caused by activities
of the Company after February 29, 1988. None of the foregoing was
affected by the change in control of Holdings on October 9, 1992.

The Company is not aware of any inability or refusal on the part of UTC
to pay amounts which are owing under the UTC indemnity. From time to
time, however, the Company and UTC have disagreed as to certain matters of
fact which would be determinative as to whether a particular environmental
matter is covered by the indemnity or is subject to the Basket. The
matters involved have arisen seriatim over the past six years and have not
been material. Each matter related to particular sites which have been
remediated and the Company has expensed all amounts incurred by it in
connection with such sites. Recently the Company and UTC agreed in
principle to share financial responsibility for all of such matters
without necessarily agreeing on all of the factual issues involved. The
Company does not believe that, in light of the UTC indemnity, any of the
environmental proceedings in which it is involved and for which it may be
liable under the Basket or otherwise will, individually or in the
aggregate, have a material adverse effect upon its business, financial
condition or results of operations and none involves sanctions for amounts
of $0.1 million or more.

In 1967, following an investigation regarding the alleged violation of
United States antitrust laws, the Company agreed that in the future it
would refrain from tying the sale of magnet wire to the purchase of other
products.

Item 4. Submission of Matters to a Vote of Security Holders

None during the fourth quarter of 1993.

PART II

Item 5. Market for the Registrant's Common Equity and Related Stockholder
Matters

There is no established public trading market for the common stock of the
Company or of its parent, Holdings. The common stock of the Company and
its parent has not been traded or sold publicly and accordingly no
information with respect to sales prices or quotations is available.

Item 6. Selected Financial Data

The following table sets forth (i) selected historical consolidated
financial data of the Company prior to the Acquisition ("Predecessor") as
of and for the nine month period ended September 30, 1992, and each of the
years in the three year period ended December 31, 1991, (ii) selected
historical consolidated financial data of the Company after the
Acquisition ("Successor") as of and for the year ended December 31, 1993
and the three month period ended December 31, 1992, and, (iii) combined
historical consolidated financial data of Successor for the three month
period ended December 31, 1992 and Predecessor for the nine month period
ended September 30, 1992. This data should be read in conjunction with
"Management's Discussion and Analysis of Results of Operations and
Financial Condition" and the consolidated financial statements and related
notes included elsewhere herein. The selected historical consolidated
financial data presented below as of and for each of the years in the two
year period ended December 31, 1990, were derived from the audited
consolidated financial statements of Predecessor (not presented herein).
The selected historical consolidated financial data presented below, as of
and for the year ended December 31, 1993, the three month period ended
December 31, 1992, the nine month period ended September 30, 1992, and the
year ended December 31, 1991, were derived from the consolidated financial
statements of Successor and Predecessor, which were audited by Ernst &
Young, independent auditors, whose report with respect thereto, together
with such financial statements, appears elsewhere herein.

SUCCESSOR COMBINED(a) PREDECESSOR
------------------- ---------- ------------------------------------------
Three Twelve
Month Month Nine Month
Year Period Period Period
In Thousands of Ended Ended Ended Ended
Dollars, Except December December December September Year Ended December 31,
Ratio Data 31, 31, 31, 30, -------------------------------
1993 1992 1992 1992 1991 1990 1989
------------------- ------ ------ ------ ------ ------ ------ ------

Statement of
Operations Data:
Net sales $868,846 $209,354 $909,351 $699,997 $885,492 $992,001 $1,054,044
Other income - net 188 145 1,237 1,092 522 1,415 697
-------- -------- -------- -------- -------- -------- ----------

869,034 209,499 910,588 701,089 886,014 993,416 1,054,741
-------- -------- -------- -------- -------- -------- ----------

Cost of goods sold 745,875 186,026 780,148 594,122 753,077 838,048 886,551
Selling and
administrative 75,489 22,349 81,958 59,609 80,227 80,267 77,622

Interest(b) 25,241 8,086 22,591 14,505 24,969 31,893 39,018
Unusual items(c) - - 18,139 18,139 - - 9,139
-------- -------- -------- -------- -------- -------- ----------

Income (loss) before
income taxes and
extraordinary
charge 22,429 (6,962) 7,752 14,714 27,741 43,208 42,411
Provision (benefit)
for income taxes(d) 13,052 (1,900) 7,378 9,278 13,241 12,760 15,700
-------- -------- -------- -------- -------- -------- ----------

Income (loss) before
extraordinary
charge 9,377 (5,062) 374 5,436 14,500 30,448 26,711
Extraordinary charge
net of income tax
benefit(e) 3,367 - 122 122 1,471 - -
-------- -------- -------- -------- -------- -------- ----------
Net Income (loss) $ 6,010 $ (5,062) $ 252 $ 5,314 $ 13,029 $ 30,448 $ 26,711
======== ======== ======== ======== ======== ======== ==========
Pro-forma net income
reflecting income
taxes on a separate
return basis(d) $ 21,699 $ 21,878
======== ==========

Balance Sheet Data
(at end of period):
Working capital $155,136 $123,935 $162,661 $124,485 $164,293 $142,918
Total assets 706,997 703,147 447,874 413,648 443,963 455,734
Long-term debt
(including current
portion) 200,000 221,289 189,890 193,580 247,426 259,857
Stockholder's equity 303,732 297,722 132,257 120,354 112,325 101,877
Other Data:

Additions to
property, plant and
equipment $26,167 $14,705 $31,180 $16,475 $13,242 $19,072 $11,670
Ratio of earnings to
fixed charges(f) 1.7 - 1.9 2.0 2.3 2.0
Deficiency of
earnings to fixed
charges - $ 7,078 - - - -

(Footnotes on following page)

(Footnotes continued from previous page)

(a) Represents a combination of Successor's three month period ended
December 31, 1992 and Predecessor's nine month period ended September
30, 1992. Such combined results are not directly comparable to the
consolidated results of operations of the Predecessor for each of the
three years ended December 31, 1991, nor are they necessarily
indicative of the results for the full year due to the effects of the
Acquisition and Merger and related refinancings and the concurrent
adoption of Statement of Financial Accounting Standards No. 109
"Accounting for Income Taxes," ("FAS 109"). See Notes to
Consolidated Financial Statements. Financial data of the Company as
of October 1, 1992 and thereafter reflect the Acquisition using the
purchase method of accounting, and accordingly, the purchase price
has been allocated to assets and liabilities based upon their
estimated fair values. However, to the extent that Holdings
management had a continuing investment interest in Holdings' common
stock, such fair values (and contributed stockholder's equity) were
reduced proportionately to reflect the continuing interest
(approximately 10%) at the prior historical cost basis.

(b) In connection with the Acquisition and Merger, debt issuance costs of
$1.5 million and $1.8 million associated with debt retired were
included in interest expense for the year ended December 31, 1993 and
the three month period ended December 31, 1992, respectively.

(c) In connection with the Acquisition and Merger, the Predecessor
recorded certain merger related expenses of $18.1 million consisting
primarily of bonus and option payments to certain employees and
certain merger fees and expenses, which have been charged to the
Predecessor's operations in the nine month period ended September 30,
1992. In May 1989, the Predecessor paid cash bonuses to certain
members of its management from the proceeds of the debentures issued
by Holdings.

(d) Holdings and the Company file a consolidated U.S. federal income tax
return. Through December 31, 1990 the deductible expenses of
Holdings (primarily interest) were included in the calculation of the
Company's income taxes under a tax sharing agreement with Holdings.
The tax sharing agreement was amended, effective January 1, 1991, to
provide that the Company's aggregate income tax liability be
calculated as if it were to file a separate return with its
subsidiaries. The tax benefits recorded in 1990 and 1989 for the
deductible expenses of Holdings were $8.7 million and $4.8 million,
respectively. The pro forma net income reflecting income taxes on a
separate return basis is presented for 1990 and 1989 as if such
benefits had not been recorded.

(e) During 1993, Successor recognized extraordinary charges of $3.1
million, net of applicable tax benefit, representing the write off of
unamortized debt costs associated with the repayment of the
outstanding balance of the Company's term loans, and $0.3 million,
net of applicable tax benefit, representing the net loss resulting
from the redemption of the Company's 12 3/8% Senior Subordinated
Debentures ("Debenture Repurchases"). During 1992 and 1991,
Predecessor made Debenture Repurchases which had a carrying value of
$13.8 million and $42.0 million, respectively. The net loss
resulting from these repurchases, which includes the write off of a

portion of unamortized debt costs, was reflected as an extraordinary
charge of $0.1 million and $1.5 million, net of applicable income tax
benefit for Predecessor during 1992 and 1991, respectively.

(f) For purposes of this computation, earnings consist of income before
income taxes plus fixed charges (excluding capitalized interest).
Fixed charges consist of interest on indebtedness (including
capitalized interest and amortization of deferred financing fees)
plus that portion of lease rental expense representative of the
interest factor (deemed to be one-third of lease rental expense).
Earnings of the Successor were insufficient to cover fixed charges by
the amount of $7.1 million for the three month period ended
December 31, 1992.

Item 7. Management's Discussion and Analysis of Results of Operations and
Financial Condition

Introduction

The Company is engaged in one principal line of business, the production
of electrical wire and cable. The Company classifies its operations into
four major divisions based on the markets served: Wire and Cable
Division, Magnet Wire and Insulation Division, Telecommunication Products
Division and Engineered Products Division. See "Business" for a
description of the principal products offered by each division and the
total sales for each major product line for the years ended 1993, 1992 and
1991.

For financial statement purposes, the Acquisition and Merger was
accounted for by Holdings as a purchase acquisition effective October 1,
1992. Because the Company is a wholly-owned subsidiary of Holdings, the
effects of the Acquisition and Merger have been reflected in the Company's
financial statements, resulting in a new basis of accounting reflecting
estimated fair values for Successor's assets and liabilities at that date.
However, to the extent that Holdings' management had a continuing
investment interest in Holdings' common stock, such fair values (and
contributed stockholder's equity) were reduced proportionately to reflect
the continuing interest (approximately 10%) at the prior historical cost
basis. As a result, the Company's financial statements for the periods
subsequent to September 30, 1992 are presented on the Successor's new
basis of accounting, while the financial statements for September 30, 1992
and prior periods are presented on the Predecessor's historical cost basis
of accounting. The consolidated results of operations of the Company for
the twelve month period ended December 31, 1992 are not directly
comparable to the consolidated results of operations of the Predecessor
due to the effects of the Acquisition and Merger and related refinancings
and the concurrent adoption of FAS 109. See Notes 1 and 7 of Notes to
Consolidated Financial Statements.

In connection with the Acquisition and Merger and the concurrent adoption
of FAS 109, the Successor recognized $142.2 million of excess of cost over
net assets acquired that is being amortized over 35 years on the straight
line method.

Results of Operations

The Year Ended December 31, 1993 Compared With The Twelve Months Ended
December 31, 1992

Net sales for 1993 were $868.8 million or 4.5% lower than 1992. Record
sales volume in 1993 exceeded the previous record-level volume of 1992 by
approximately 5.1% but was more than offset by reduced product prices
reflecting lower copper costs, the Company's principal raw material, and
competitive pricing pressures. Copper costs are generally passed on to
customers through product pricing. The average price for copper on the
New York Commodity Exchange, Inc. (the "COMEX") declined 17.0% from 1992.
The Company believes the improved sales volume resulted from increased
demand for wire products within the served markets and was attributable to
an improving economy, especially as it affected the markets served by the
Magnet Wire and Insulation and Engineered Products Divisions. For a
discussion of the Company's practices with respect to the purchase,
internal distribution and processing of copper, see "Business-Metals
Operations." Also see "General Economic Conditions and Inflation" under
this caption.

Sales for the Magnet Wire and Insulation Division were up 5.3% compared
to 1992. Sales volume increased 12.5% over 1992 resulting from increased
demand for magnet wire products in the automotive, electric motor and
transformer markets in addition to increased sales to distributors.
Product pricing was down approximately 6.9% due primarily to lower copper
prices in 1993 compared to 1992. The Engineered Products Division
experienced a 5.3% increase in sales over 1992 attributable primarily to
increased demand for the division's automotive wire products. Automotive
wire volumes increased approximately 21% from 1992 due in part to improved
demand from its primary customer and to several new accounts. See
"Business-Division Operations-Engineered Products Division". Of the
increased automotive sales volume, 27% resulted from new customers. Sales
of non-automotive products also experienced volume improvements despite
decreased demand for pump and welding cable products resulting from
flooding in the midwest during 1993. The Wire and Cable, and
Telecommunication Products Divisions experienced sales declines in 1993
compared with 1992. The Wire and Cable Division's sales were off 11.3%
from 1992 due principally to lower copper prices and reduced product
pricing. Volume was down slightly compared with 1992 due mainly to
selective market participation during part of the year. Sales by the
Telecommunication Products Division were down approximately 11.8% compared
with 1992. In addition to reduced product pricing, unit sales volume to
the domestic telephone markets was down 22.0% partially offset by a 19.3%
increase in export unit volume. Product demand within the domestic
markets was down due primarily to general uncertainty about the economy as
well as the ongoing restructuring of the U.S. telephone cable industry.

Cost of goods sold decreased 4.4% in 1993 compared with 1992 due
primarily to lower copper prices partially offset by higher sales volume
and additional depreciation expense resulting from the application of
purchase accounting in connection with the Acquisition and Merger and the
concurrent adoption of FAS 109 (See Notes 1 and 7 of Notes to Consolidated
Financial Statements). The Company's cost of goods sold as a percentage
of net sales was 85.8% in each of 1993 and 1992. The cost of goods sold
percentage in 1993 was adversely impacted by generally lower selling
prices and additional depreciation expense resulting from the application
of purchase accounting in connection with the Acquisition and Merger and

the concurrent adoption of FAS 109 partially offset by lower manufacturing
costs resulting from increased capacity utilization. Cost of goods sold
in 1992 includes a charge of $2.6 million relating to planned plant
consolidations, primarily costs to move equipment and personnel related
expenses. Raw material costs in 1993, excluding copper, were generally
unchanged from 1992.

Selling and administrative expenses in 1993 were 7.9% lower than 1992 due
primarily to the expiration of a non-compete agreement with UTC in the
first quarter 1993 resulting in the elimination of the related
amortization charge, a $2.1 million reduction in the Company's health
insurance expense and a $1.5 million accrual in 1992 for the relocation of
a business unit in 1993. In connection with the 1988 Acquisition, UTC
agreed that until March 1, 1993, it would not engage in any business
directly competing with any business carried on by the Company on February
29, 1988. The $34.0 million purchase price allocated to the covenant not
to compete was amortized over five years on the straight line method. The
reduction in health insurance expense was attributable to favorable
experience in health related expenditures. Partially offsetting these
expense reductions was a $4.0 million amortization charge recorded in 1993
for excess of cost over net assets acquired compared to a $1.0 million
charge recorded in the last quarter of 1992 and a $2.5 million reduction
in the Company's allowance for doubtful accounts recorded in the third
quarter of 1992. In connection with the Acquisition and Merger and
concurrent adoption of FAS 109, the Successor recognized $142.2 million of
excess of cost over net assets acquired that is being amortized over 35
years on the straight line method. The Company's allowance for doubtful
accounts was reduced on the basis of the collection of a substantial
receivable which had been considered doubtful as well as management's
assessment of collection risk in the primary markets served.

Interest expense in 1993 was $25.2 million as compared to $22.6 million
in 1992. The increase was principally caused by $19.0 million in
additional weighted average debt outstanding and an increase in the
Company's average interest rate incurred (from 8.9% to 9.7%). The
additional debt outstanding was primarily attributable to Acquisition-
related borrowings and the May 1993 sale by the Company of its 10% Senior
Notes due 2003 (the "Senior Notes"). Average interest rates increased
reflecting the higher interest rate on the Senior Notes compared with the
rate of interest on the Term Credit which was repaid from the sale of the
Senior Notes, partially offset by the redemption of all outstanding
12 3/8% Senior Subordinated Debentures due 2000 (the "Debentures") which
were also repaid in connection with the issuance of the Senior Notes. See
also "Liquidity, Capital Resources and Financial Condition".

In connection with the Acquisition and Merger, the Company incurred
certain merger related expenses in the amount of $18.1 million consisting
primarily of bonus and option payments to certain employees, and certain
merger fees and expenses which were charged to operations of the
Predecessor in the quarter ended September 30, 1992. These Acquisition
and Merger expenses had the effect of reducing 1992 net income by $12.5
million (after applicable tax benefit of $5.6 million). See Note 1 of
Notes to Consolidated Financial Statements.

Income tax expense was $13.1 million, or 58.2% of pretax income in 1993
compared with $7.4 million, or 95.2%, of pretax income in 1992. The
Company elected not to step up its tax bases in the assets acquired in
either the Acquisition or the 1988 Acquisition. Accordingly, the

Company's income tax bases in the assets acquired have not been changed
from those prior to the 1988 Acquisition. Depreciation and amortization
of the higher allocated financial statement bases are not deductible for
income tax purposes, thus causing the effective income tax rate of the
Predecessor to be generally higher than the combined federal and state
statutory rate. Because of the adoption of FAS 109 by the Successor,
concurrent with the Acquisition, deferred income taxes have been provided
for bases differences in all assets and liabilities other than excess of
cost over net assets acquired. In compliance with the Omnibus Budget
Reconciliation Act of 1993, the Company's tax balances were adjusted in
the third quarter of 1993 to reflect the new federal statutory tax rate of
35%. The adjustment had the effect of increasing income tax expense by
$2.3 million for 1993 or 10.0% of pretax income. See Note 7 of Notes to
Consolidated Financial Statements.

The Company recorded net income of $6.0 million in 1993 as compared to
net income of $0.3 million in 1992. The 1993 results include
extraordinary charges of $3.4 million ($5.5 million before applicable tax
benefits) associated with the repayment of the Term Credit and redemption
of the Debentures. See also "Liquidity, Capital Resources and Financial
Condition". The 1992 results include $18.1 million of Acquisition and
Merger related expenses, $12.5 million net of applicable tax benefit, and
a $0.1 million extraordinary charge ($0.2 million before applicable tax
benefit) resulting from the partial repurchase of a portion of the
outstanding Debentures.

Twelve Months Ended December 31, 1992 Compared With The Year Ended
December 31, 1991

Net sales for 1992 were $909.4 million or 2.7% greater than 1991 due
principally to a record volume year with an 8.0% increase in sales volume
over 1991. The Company attributes the increase in sales volume at least
in part to the strengthening U.S. economy during the period. The positive
effects of an increase in sales volumes were partially offset, however, by
lower copper prices, the Company's principal raw material, and competitive
product pricing. Copper costs are generally passed on to customers
through product pricing and the average price for copper on the COMEX
declined 2.1% from 1991. Due to increased competitive pressures,
primarily in the building wire and telecommunication cable product lines,
overall product pricing was below 1991 levels. For a discussion of the
Company's practices with respect to the purchase, internal distribution
and processing of copper, see "Business Metals Operations." Also see
"General Economic Conditions and Inflation" under this caption.

The Wire and Cable Division's sales, after reflecting the transfer to the
Engineered Products Division of an industrial wire product line
representing $32.7 million in sales in 1992, declined 3.1% from 1991 sales
levels. Despite such product line transfer, Wire and Cable Division sales
volume was nearly 4.7% ahead of 1991 due to improved demand for building
wire products. Sales for the division would have increased 5.8% and sales
volume would have increased 10.9% in 1992 over 1991 had the industrial
wire product line transfer occurred on January 1, 1991. Increased
competitive pressures in the fourth quarter of 1992, however, caused an
overall deterioration in product pricing for the year. Sales volume
during the fourth quarter was essentially unchanged from the same period
in 1991. The Magnet Wire and Insulation Division's sales increased 2.7%
over 1991 due primarily to a 7.5% improvement in sales volume. Increased
automobile and truck production coupled with an upturn in housing starts

contributed to the higher volumes. Magnet Wire and Insulation Division
product pricing declined marginally from 1991. Telecommunication Products
Division sales were off 5.5% from 1991 levels. During 1992, the
Telecommunication Products Division experienced more severe pricing
pressures in its domestic markets and therefore, diverted a larger portion
of its manufacturing capacity to serve export markets. Consequently,
export sales for the division were up 111.4% from 1991. Due to the change
in product mix and continued pricing pressures, average Telecommunication
Products Division product pricing declined moderately from 1991.
Engineered Products Division's sales were up $37.1 million from 1991
although $32.7 million of that increase was attributable to the transfer
from the Wire and Cable Division of the industrial wire product line.
Without giving effect to that transfer, sales were up 6.2% due to an
increase in automotive and industrial wire sales volumes. A generally
improved economy coupled with an approximate 8.9% rise in domestic
automobile and truck production were the primary contributors to this
improvement.

Cost of goods sold in 1992 increased 3.6% from 1991 due primarily to
higher sales volume partially offset by lower copper costs and generally
lower other material costs. The Company's cost of goods sold as a percent
of net sales was 85.8% and 85.0% in 1992 and 1991, respectively. The cost
of goods sold percentage in 1992 was higher than in 1991 because the
Company's major business units experienced greater competitive pricing
pressure resulting in generally lower selling prices. The higher sales
volume, however, lead to increased capacity utilization resulting in
generally lower manufacturing costs. Cost of goods sold in 1992 was also
impacted by a charge of approximately $2.6 million to reflect anticipated
plant consolidations and approximately $1.6 million in additional
depreciation expense resulting from the October 1, 1992 application of
purchase accounting in connection with the Acquisition and Merger and the
concurrent adoption of FAS 109 on a prospective basis.

Selling and administrative expenses for 1992 were up 2.2% from 1991 but
remained at approximately 9.0% of sales. Contributing to this increase
was a $1.5 million accrual in 1992 for the anticipated relocation of a
business unit in 1993 and a $1.0 million amortization charge for the
excess cost over net assets acquired associated with the Acquisition and
Merger and adoption of FAS 109. A reduction of $2.5 million in the
Company's allowance for doubtful accounts and a $1.0 million reduction in
its health insurance accrual in 1992 offset the foregoing charges. The
Company's allowance for doubtful accounts was reduced by $2.5 million (net
$1.8 million after approximately $0.7 million current provision) on the
basis of the collection of a substantial receivable which had been
considered doubtful as well as management's assessment of risk of
collection in the primary markets served. In addition, actual health
related expenditures did not increase to the levels previously
anticipated. The 1991 results include a charge for a warranty claim
settlement of approximately $1.7 million.

Interest expense in 1992 was $22.6 million as compared to $25.0 million
in 1991. This 9.5% decrease was due principally to a $17.5 million
reduction in the Company's weighted average total debt outstanding during
1992 and generally lower interest rates on the Company's bank credit
facilities. During 1992, Debenture Repurchases totalled $13.8 million
while the Company's weighted average interest rate on debt outstanding
declined from 10.4% to 8.7%. Partially offsetting these favorable
outcomes was an amortization charge related to the deferred debt costs

incurred to place the new credit agreement and amortization of deferred
debt costs on debt retired and to be retired in connection with the
Acquisition. See "Liquidity, Capital Resources and Financial Condition."

In connection with the Acquisition and Merger, the Company incurred
certain merger related expenses in the amount of $18.1 million consisting
primarily of bonus and option payments to certain employees, and certain
merger fees and expenses which were charged to operations of the
Predecessor in the quarter ended September 30, 1992. These Acquisition
and Merger expenses had the effect of reducing net income by $12.5 million
(after applicable tax benefit of $5.6 million). See Note 1 of Notes to
Consolidated Financial Statements.

Income tax expense was $7.4 million, or 95.2% of pretax income in 1992
compared with $13.2 million, or 47.7%, of pretax income in 1991. The
Company elected not to step up its tax bases in the assets acquired in
either the Acquisition or the 1988 Acquisition. Accordingly, the
Company's income tax bases in the assets acquired have not been changed
from those prior to the 1988 Acquisition. Depreciation and amortization
of the higher allocated financial statement bases are not deductible for
income tax purposes, thus causing the effective income tax rate of the
Predecessor Company to be generally higher than the approximate statutory
rate of 39%. Because of the adoption of FAS 109 by the Successor Company
concurrent with the Acquisition, deferred income taxes have been provided
for bases differences in all assets and liabilities other than excess of
cost over net assets acquired. See Notes 2 and 7 of Notes to Consolidated
Financial Statements.

The Company's net income for the twelve month period ended December 31,
1992 (after giving effect to $18.1 million of Acquisition and Merger
related expenses, $12.5 million net of applicable tax benefit) was $0.3
million which included a $0.1 million ($0.2 million before applicable tax
benefit) extraordinary charge resulting from Debenture Repurchases.

Liquidity, Capital Resources and Financial Condition

The Company had a ratio of debt (consisting of current and non-current
portions of long-term debt) to stockholder's equity of approximately 0.7
to 1 at December 31, 1993 and 1992.

In connection with the Acquisition and Merger, the Company entered into a
credit agreement in September 1992, among BE, the Company, Holdings, the
lenders named therein and Chemical Bank, as agent (the "Credit
Agreement"). Under the Credit Agreement, the Company borrowed $130.0
million in term loans (the "Term Credit") of which $94.0 million was used
to repay all indebtedness outstanding under the Company's previous credit
agreement and the balance was used to pay a portion of the consideration
payable to Holdings' shareholders and option holders in the Merger and
certain fees and expenses of the Company and Holdings related to the
Acquisition and Merger and for other general corporate purposes. The
Credit Agreement also provided for $155.0 million in revolving credit
expiring April 9, 1998.

In May 1993, the Company issued $200.0 million aggregate principal amount
of its Senior Notes. The net proceeds to the Company from the sale of the
Senior Notes, after underwriting discounts, commissions and other offering
expenses, were approximately $193.5 million. The Company applied
approximately $111.0 million of such proceeds to the repayment of the Term

Credit and in June 1993 applied the balance of such proceeds together with
new borrowings of approximately $7.5 million under the revolving credit
facility of the amended and restated credit agreement (see immediately
following paragraph), to redeem all of its outstanding Debentures. The
Company recognized extraordinary charges in the second quarter of 1993 of
approximately $3.4 million ($5.5 million before applicable tax benefit)
associated with the repayment of the Term Credit and redemption of the
Debentures.

Upon application of the net proceeds received from the Senior Notes to
repay the Term Credit, as discussed above, an amendment and restatement of
the Credit Agreement became effective (the "Restated Credit Agreement").
The Restated Credit Agreement provides for $175.0 million in revolving
credit, subject to specified percentages of eligible assets, reduced by
outstanding letters of credit (the "Revolving Credit"). The Revolving
Credit expires in 1998. Revolving Credit loans bear interest at floating
rates at bank prime rate plus 1.25% or a reserve adjusted Eurodollar rate
(LIBOR) plus 2.25%. The effective interest rate can be reduced by 0.25%
to 0.75% if certain specified financial conditions are achieved. The
Company has purchased interest rate cap protection through 1994 covering
up to $100.0 million of Revolving Credit borrowings. No term facility is
available under the Restated Credit Agreement. Through December 31, 1993,
the Company fully complied with all of the financial ratios and covenants
contained in the Restated Credit Agreement and the indenture under which
the Senior Notes were issued (the "Indenture").

The Restated Credit Agreement and the Indenture contain provisions which
may restrict the liquidity of the Company. These include restrictions on
the incurrence of additional indebtedness and, in the case of the Restated
Credit Agreement, mandatory principal repayment requirements for all
indebtedness that exceeds the Borrowing Base as defined in the Restated
Credit Agreement.

Net cash provided by operating activities in 1993 was $60.7 million, an
increase of $27.2 million over 1992. Cash flow provided by operating
activities in 1993, together with borrowings under the revolving credit
facility of the Credit Agreement and the Restated Credit Agreement were
sufficient to meet the Company's cash interest requirements, working
capital and capital expenditure needs and to pay mandatory principal
payments on the Term Credit portion of the Credit Agreement. As
previously discussed, the Term Credit was repaid in full in May 1993 out
of proceeds from the issuance and sale of the Senior Notes.

Capital expenditures in 1993 were $26.2 million or $5.0 million less than
in 1992. Such expenditures included $2.6 and $9.2 million for a new
magnet wire manufacturing facility in Franklin, Indiana in 1993 and 1992,
respectively. This new facility is occupied by both the Company and
Femco. Femco was established in 1988 as a joint venture between the
Company and The Furukawa Electric Company, Ltd., Tokyo, Japan. At
December 31, 1993, approximately $8.6 million was committed to outside
vendors for capital projects to expand capacity, complete modernization
projects, reduce costs and ensure continued compliance with regulatory
provisions. Capital expenditures in 1994 are expected to approximate 1993
spending levels. In November 1993, the Company acquired a majority
interest in Interstate Industries, Inc. for cash of $4.3 million, subject
to final purchase price adjustments and the minority interest ownership
percentage. See "Business--Business Development." The Restated Credit

Agreement imposes annual limits on the Company's capital expenditures and
business acquisitions.

The Company anticipates that its working capital, capital expenditure and
cash interest requirements for 1994 will be satisfied through a
combination of funds generated from operating activities together with
funds available under the Revolving Credit. Management bases such belief
on historical experience and the substantial availability of funds under
the Revolving Credit. Increased working capital needs occur whenever the
Company experiences strong incremental demand in its business as well as a
significant rise in copper prices. Average quarterly cash flow generated
from operations for the three year period ended December 31, 1993 was
$13.7 million; at December 31, 1993 the entire $175.0 million of Revolving
Credit was available, subject to specified percentages of eligible assets,
(less $13.9 million in outstanding letters of credit). During 1993,
average borrowings under the Company's revolving credit facilities were
$10.1 million compared to $66.8 million during 1992. In 1993 certain
pension actuarial assumptions were revised to reflect changes in their
underlying economic fundamentals. The effect of such revisions on the
Company's results of operations and cash flows for 1994 is not expected to
be material.

The Company expects that it may also make certain cash payments to
Holdings or other affiliates from time to time to the extent cash is
available and to the extent it is permitted to do so under the terms of
the Restated Credit Agreement and the Indenture. Such payments may
include (i) an amount necessary under the tax sharing agreement between
the Company and Holdings to enable Holdings to pay the Company's taxes as
if computed on an unconsolidated basis; (ii) a management fee to an
affiliate of BHLP of up to $1.0 million; (iii) amounts to repurchase
outstanding Senior Discount Debentures due 2004 of Holdings (the "Holdings
Debentures") to the extent they may become available for repurchase in the
open market at prices which Holdings and the Company find attractive and
to the extent such repurchases are permitted under the terms of the
instruments governing Holdings and the Company's indebtedness; and (iv)
other amounts to meet ongoing expenses of Holdings (such amounts are
considered to be immaterial both individually and in the aggregate). To
the extent the Company makes any such payments, it will do so out of
operating cash flow or borrowings under the Restated Credit Agreement and
only to the extent such payments are permitted under the terms of the
Restated Credit Agreement and the Indenture. Each of the foregoing
payments is either completely discretionary on the part of the Company or
may be waived by an affiliate of the Company.

Notwithstanding any of the foregoing payments which the Company may make
to Holdings, Holdings' actual liquidity requirements are expected to be
insubstantial in 1994 on an unconsolidated basis because Holdings has no
operations (other than those conducted through the Company) or employees
and is not expected to have any tax liability on an unconsolidated basis.
Holdings' Series A Cumulative Redeemable Exchangeable Preferred Stock,
Liquidation Preference $25 Per Share (the "Series A Preferred Stock"),
which was issued in connection with the Acquisition and Merger, provides
that dividends may be paid in kind at the option of Holdings until 1998
and is not subject to mandatory redemption until 2004 (except upon the
occurrence of certain specified events). The redemption price is $25 per
share plus accrued and unpaid dividends to the date of redemption. For
the year ended December 31, 1993 Holdings recorded dividends in kind of
$5.2 million. The Restated Credit Agreement permits Holdings to pay

dividends in cash on the Series A Preferred Stock subject to certain
limitations. However, in the near term, Holdings expects to pay dividends
on the Series A Preferred Stock in additional shares of such stock. The
Holdings Debentures are not expected to have an impact on the Company's
liquidity prior to November 15, 1995 (unless they are repurchased or
refinanced prior to that date) when cash interest at 16.0% first becomes
payable semi-annually. The Holdings Debentures were issued in May 1989.
As of December 31, 1993, Holdings had a liability, net of repurchases, of
$228.9 million in respect of the Holdings Debentures ($277.8 million
aggregate principal amount). Through December 31, 1993 Holdings had
repurchased $64.2 million aggregate principal amount of its Holdings
Debentures in the open market using cash dividends, management fees and
income taxes paid to Holdings by the Company together with available cash.
Such payments were made pursuant to the Company's prior credit agreement
which was terminated October 9, 1992. There have been no repurchases of
Holdings Debentures since 1991 and further repurchases, if any, may be
made at the discretion of Holdings and will depend upon market conditions,
and, in particular, the prices at which the Holdings Debentures are
trading as well as Holdings' available cash. The Holdings Debentures are
unsecured debt of Holdings and are effectively subordinated to all
outstanding indebtedness of the Company, including the Senior Notes, and
will be effectively subordinated to other indebtedness incurred by direct
and indirect subsidiaries of Holdings, if issued.

Because Holdings is a holding company with no operations and has
virtually no assets other than the outstanding capital stock of the
Company (all of which is pledged to the lenders under the Restated Credit
Agreement), Holdings' ability to meet its cash obligations will be
dependent upon the Company's ability to pay dividends, loan or to
otherwise advance or transfer funds to Holdings in sufficient amounts.
The Company believes that the Restated Credit Agreement and the Indenture
permit the Company to dividend or otherwise provide funds to Holdings to
enable Holdings to meet its known cash obligations provided that the
Company meets certain conditions. Among such conditions, however, are
that the Company meet various financial maintenance tests. There can be
no assurance that such tests will be met, in which case the Company would
not be able to pay dividends to Holdings without the consent of the
percentage of the lenders specified in the Restated Credit Agreement
and/or the holders of the percentage of the Senior Notes specified in the
Indenture. There can be no assurance that the Company would be able to
obtain such consents, or meet the terms on which such consents might be
granted if they were obtainable. Moreover, a violation of the Restated
Credit Agreement and/or the Indenture could lead to an event of default
and acceleration of outstanding indebtedness under the Restated Credit
Agreement and to acceleration of the indebtedness represented by the
Senior Notes and the Holdings Debentures. Because the capital stock of
the Company and its subsidiaries, as well as virtually all of the assets
of the Company and its subsidiaries, are pledged to the lenders under the
Restated Credit Agreement, such lenders would have a claim over such
assets prior to holders of the Senior Notes and the Holdings Debentures.
In the event Holdings were unable to meet its cash obligations, a sequence
of events similar to that described above could ultimately occur.

General Economic Conditions and Inflation

The Company faces various economic risks ranging from an economic
downturn adversely impacting the Company's primary markets to marked
fluctuations in copper prices. In the short-term, pronounced changes in

the price of copper tend to affect the Wire and Cable Division's gross
profits because such changes affect raw material costs more quickly than
those changes can be reflected in the pricing of the Wire and Cable
Division's products. In the long-term, however, copper price changes have
not had a material adverse effect on gross profits because cost changes
generally have been passed through to customers over time. In addition,
the Company believes that its sensitivity to downturns in its primary
markets is less significant than it might otherwise be due to its diverse
customer base and its strategy of attempting to match its copper purchases
with its needs. During 1993, the Company experienced general improvement
in most of its markets served coinciding with general economic conditions.
The Company cannot predict either the continuation of current economic
conditions or future results of its operations in light thereof.

The Company believes that it is not particularly affected by inflation
except to the extent that the economy in general is thereby affected.
Should inflationary pressures drive costs higher, the Company believes
that general industry competitive price increases would sustain operating
results, although there can be no assurance that this will be the case.

Item 8. Financial Statements and Supplementary Data

INDEX TO FINANCIAL STATEMENTS

Report of Independent Auditors . . . . . . . . . . . . . . F-1

Consolidated Balance Sheets:
Successor as of December 31, 1993 and 1992 . . . . . . F-2

Consolidated Statements of Operations:
Successor for the year ended December 31, 1993,
and the three month period ended
December 31, 1992 . . . . . . . . . . . . . . . . . . . F-3
Predecessor for the nine month period ended
September 30, 1992 and the year ended
December 31, 1991 . . . . . . . . . . . . . . . . . . F-3

Consolidated Statements of Cash Flows:
Successor for the year ended December 31, 1993,
and the three month period ended
December 31, 1992 . . . . . . . . . . . . . . . . . . . F-4
Predecessor for the nine month period ended
September 30, 1992 and the year ended
December 31, 1991 . . . . . . . . . . . . . . . . . . F-4

Notes to Consolidated Financial Statements . . . . . . . . F-5

INDEX TO FINANCIAL STATEMENT SCHEDULES

V. Property, Plant and Equipment . . . . . . . . . . . . . . . S-1

VI. Accumulated Depreciation of Property, Plant and Equipment . S-2

VIII. Valuation and Qualifying Accounts . . . . . . . . . . . . . S-3

X. Supplementary Income Statement Information . . . . . . . . S-4

All other schedules have been omitted because they are not applicable or
not required or because the required information is included in the
consolidated financial statements or notes thereto.

Item 9. Changes in and Disagreements With Accountants on Accounting and
Financial Disclosure

Not applicable.

PART III

Item 10. Directors and Executive Officers of the Registrant

The following table sets forth information concerning the Directors and
Executive Officers of the Company.

Name Age Position
____ ___ ________

Stanley C. Craft 55 President and Chief Executive Officer; Director
Steven R. Abbott 46 President - Wire and Cable Division; Director
John L. Cox 50 President - Telecommunication Products Division;
Director
Robert J. Faucher 49 President - Engineered Products Division;
Director
Robert D. Lindsay 39 Director
Charles W. McGregor 52 President - Magnet Wire and Insulation Division
David A. Owen 48 Vice President - Finance, Treasurer, and Chief
Financial Officer; Director
Thomas A. Twehues 61 Executive Vice President; Director
Ward W. Woods 51 Director
Frederick M. Zinser 65 Executive Vice President

Messrs. Craft, Abbott and Twehues have been directors since 1988.
Messrs. Lindsay and Woods became directors of the Company in 1992. Mr.
Owen has been a director since March 1993 and Messrs. Cox and Faucher were
elected directors in April 1993. Directors of the Company are elected
annually to serve until the next annual meeting of stockholders of the
Company or until their successors have been elected or appointed and
qualified. Executive officers are appointed by, and serve at the
discretion of, the Board of Directors of the Company.

Mr. Craft has served as President and Chief Executive Officer of the
Company since March 1992 and as President since September 1991 . He was
Vice President - Finance, Treasurer and Chief Financial Officer of the
Company from March 1988 to August 1991. He was Executive Vice President
of the European operations of the Company from November 1986 to February
1988. Mr. Craft is also a Director of Holdings.

Mr. Abbott was appointed President of the Wire and Cable Division in
September 1993. He was President of the Magnet Wire and Insulation
Division from 1987 to 1993. Mr. Abbott has been employed by the Company
since 1967.

Mr. Cox was appointed President of the Telecommunication Products
Division in June 1992 when he joined the Company. He had been with
American Telephone and Telegraph for twenty five years the last three of
which were as Director of Sales for Distributor Networks. Prior to that
Mr. Cox was Manager of Product Planning for distributor network exchange
cable.

Mr. Faucher was appointed President of the Engineered Products Division
in January 1992. He was Vice President, Operations in the Industrial
Products Division from June 1988 to January 1992. He joined the Company
in 1985 as Vice President, Planning.

Mr. Lindsay is the sole shareholder of corporations that are the general
partners of the partnerships which are the general partners of BHLP and
BCP. He is also the sole shareholder of corporations which are the
general partners of the two partnerships affiliated with BHLP and BCP to
which the Company and Holdings paid the fees described under Item 13
below. Mr. Lindsay was Managing Director of Bessemer Securities
Corporation ("BSC"), the principal limited partner of BHLP and BCP, from
January 1991 to June 1993. Prior to joining BSC, Mr. Lindsay was a
Managing Director in the Merchant Banking Division of Morgan Stanley &
Co., Incorporated. He is a Director of Stant Corporation and private
companies. Mr. Lindsay is also a Director of Holdings.

Mr. McGregor was appointed President of the Magnet Wire and Insulation
Division in September 1993. He was Director of Manufacturing for the
Division from 1987 to 1993. Mr. McGregor has been employed by the Company
in various technical assignments since January 1970.

Mr. Owen was appointed Vice President Finance and Chief Financial Officer
of the Company in March 1993. He was appointed Treasurer of the Company
in April 1992. Prior to that time, Mr. Owen was Director, Treasury and
Financial Services for the Company. Mr. Owen has been employed in various
capacities by the Company since 1976.

Mr. Twehues has been Executive Vice President since September 1993. He
had been President of the Wire and Cable Division since 1981. Mr.
Twehues started his career in sales with the Wire and Cable Division in
1960.

Mr. Woods is the sole shareholder of corporations that are the general
partners of the partnerships which are the general partners of BHLP and
BCP. He is also the sole shareholder of corporations which are the
general partners of the two partnerships affiliated with BHLP and BCP to
which the Company and Holdings paid the fees described under Item 13
below. Mr. Woods is President and Chief Executive Officer of BSC, the
principal limited partner of BHLP and BCP. Mr. Woods joined BSC in 1989.
For ten years prior to joining BSC, Mr. Woods was a senior partner of
Lazard Freres & Co., an investment banking firm. He is a director of
Boise Cascade Corporation, Freeport-McMoran Inc., Overhead Door
Corporation, Stant Corporation and several private companies. Mr. Woods
is also a Director of Holdings.

Mr. Zinser had been an Executive Vice President since June 1992 and the
President of the Telecommunication Products Division from 1979 to June
1992. Mr. Zinser retired from the Company effective January 1, 1994.

Item 11. Executive Compensation

Compensation of Directors and Executive Officers

The directors of the Company receive no compensation for their service as
directors except for reimbursement of expenses incidental to attendance at
meetings of the Board of Directors.

The following table sets forth the cash compensation paid by or incurred
on behalf of the Company to its Chief Executive Officer and four other
most highly compensated executive officers of the Company for each of the
three years ended December 31, 1993.

SUMMARY COMPENSATION TABLE

Long Term
Annual Compensation
Compensation Awards
----------------- ------------
Number of
Securities
Underlying
Options/ All Other
Salary Bonus SARs Compensation
Name and Principal Position Year ($) ($) (#) (1) ($) (2) (3)
--------------------------- ---- ------- ------- ------------ ------------

Stanley C. Craft 1993 278,754 130,000 40,000 12,534
President and 1992 241,672 99,650 18,000 1,378,573
Chief Executive 1991 150,820 84,422 30,000 6,933
Officer (CEO)

Steven R. Abbott 1993 172,500 72,000 25,000 8,599
President - Wire 1992 151,120 49,275 15,000 908,158
and Cable Division 1991 142,282 70,500 28,000 5,653

Thomas A. Twehues 1993 170,000 34,000 - 11,602
Executive Vice 1992 155,994 49,275 15,000 923,295
President 1991 147,868 58,000 26,000 8,316

Robert J. Faucher 1993 141,876 55,000 25,000 6,916
President - Engineered 1992 126,942 40,575 35,000 665,143
Products Division 1991 107,767 36,400 24,000 4,918

Frederick M. Zinser 1993 153,163 35,000 - 14,153
Executive Vice 1992 136,676 40,500 15,000 595,652
President 1991 132,013 47,600 31,000 8,466

(1) All awards are for options to purchase the number of shares of common
stock of Holdings indicated, provided, however, that the number of
shares for which all options are exercisable and the exercise price
therefor may be reduced by the Board of Directors of Holdings in
accordance with a specified formula. See "Security Ownership of
Certain Beneficial Owners and Management."

(2) All Other Compensation in 1993 consists of Company contributions to
the defined contribution plan on behalf of the executive officer and
imputed income on excess Company-paid life insurance premiums. The
following table identifies and quantifies these amounts for the named
executive officers:

S.C. Craft S.R. AbbottT.A. Twehues R.J. Faucher F.M. Zinser
---------- ----------------------- ------------- -----------

Defined contribution plan
payments $7,504 $7,582 $6,373 $6,110 $5,857

Imputed income on excess
life insurance premiums 5,030 1,017 5,229 806 8,296
-------- -------- -------- -------- --------

Total $12,534 $8,599 $11,602 $6,916 $14,153
======== ======== ======== ======== ========

(3) All Other Compensation in 1992 includes principally divestiture and
retention bonuses paid in connection with the Acquisition and Merger.

OPTIONS/SAR GRANTS IN LAST FISCAL YEAR

Potential Realizable
Value at Assumed
Annual Rates of Stock
Price Appreciation
Individual Grants for Option Term (2)
------------------------------------------------------------------------ ---------------------
Number of
Securities % of Total
Underlying Options/SARs
Options/SARs Granted to Exercise or
Granted Employees in Base Price Expiration
Name (#) (1) Fiscal Year ($/Sh) Date 5% ($) 10% ($)
------------------- ------------- ------------- ------------ ---------- ---------- ----------

Stanley C. Craft 40,000 17.8 2.86 2/01/04 71,785 182,070

Steven R. Abbott 25,000 11.1 2.86 2/01/04 44,865 113,795

Thomas A. Twehues - - - - - -

Robert J. Faucher 25,000 11.1 2.86 2/01/04 44,865 113,795

Frederick M. Zinser - - - - - -

(1) In February 1994 options to purchase 225,000 shares of Holdings
common stock were granted in respect of performance for the year
ended December 31, 1993. All such options become exercisable on
February 1, 1997.

(2) The potential realizable value assumes a per-share market price at
the time of the grant to be approximately $2.86 with an assumed rate
of appreciation of 5% and 10%, respectively, compounded annually for
10 years.

The following table details the December 31, 1993 year end estimated
value of each named executive officer's unexercised stock options. All
unexercised options are to purchase the number of shares of common stock
of Holdings indicated, provided, however, that the Board of Directors of
Holdings may require that, in lieu of the exercise of any options, such
options be surrendered without payment of the exercise price, in which
case the number of shares issuable upon exercise of such options shall be
reduced by the quotient of (i) the aggregate exercise price that would
have been otherwise payable divided by (ii) the amount paid for each share
of Holdings common stock in the Merger (approximately $2.86 per share).
See "Security Ownership of Certain Beneficial Owners and Management."

AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND
YEAR-END OPTION/SAR VALUES

Number of
Securities
Underlying Value of Unexercised
Unexercised In-the-Money
Options/SARs at Options/SARs at
Year-End (#) Year-End ($)
Shares Acquired Value Realized Exercisable/ Exercisable/
Name on Exercise (#) ($) Unexercisable Unexercisable (1)(2)
------------------- --------------- -------------- --------------- -------------------

Stanley C. Craft - - 583,000(E) 1,078,464(E)
40,000(U) - (U)

Steven R. Abbott - - 273,000(E) 503,367(E)
25,000(U) - (U)

Thomas A. Twehues - - 576,000(E) 1,066,211(E)

Robert J. Faucher - - 145,000(E) 260,598(E)
25,000(U) - (U)

Frederick M. Zinser - - 436,000(E) 806,151(E)

(E) Exercisable

(U) Unexercisable

(1) The estimated value of unexercised stock options held at the end of
1993 assumes a per-share fair market value of approximately $2.86 and
per-share exercise prices of $1.00 and $1.25 as applicable.

(2) The options to purchase Holdings common stock granted in 1994 in
respect of performance for the year ended December 31, 1993, were
issued with an exercise price of $2.86 per share. Such options are
not considered in-the-money since the assumed per-share fair market
value at December 31, 1993 approximated $2.86.

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

PENSION PLAN TABLE

Years of Service
-----------------------------------------------------------
Remuneration 15 20 25 30 35
------------ -- -- -- -- --

125,000 $ 28,125 $ 37,500 $ 46,875 $ 56,250 $ 65,625
150,000 33,750 45,000 56,250 67,500 78,750

175,000 39,375 52,500 65,625 78,750 91,875
200,000 45,000 60,000 75,000 90,000 105,000

225,000 50,625 67,500 84,375 101,250 118,125
250,000 56,250 75,000 93,750 112,500 131,250

300,000 67,500 90,000 112,500 135,000 157,500
400,000 90,000 120,000 150,000 180,000 210,000

450,000 101,250 135,000 168,750 202,500 236,250
500,000 112,500 150,000 187,500 225,000 262,500

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

As of December 31, 1993, the years of credited service under the Pension
Plan for each of the executive officers named in the Summary Compensation
Table were as follows: Mr. Craft, twenty-four years and nine months; Mr.
Abbott, twenty-four years and seven months; Mr. Twehues, thirty-three
years and four months; Mr. Faucher, twenty-one years and six months; and
Mr. Zinser, twenty-eight years and five months.

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

Compensation Committee Interlocks and Insider Participation

Messrs. Stanley C. Craft and Robert Lindsay constitute the Compensation
Committee of the Board of Directors of the Company. See footnote (2)
under the caption "Security Ownership of Certain Beneficial Owners and
Management" for a description of the relationship between Mr. Lindsay and
BHLP and the information set forth under the caption "Certain
Relationships and Related Transactions" for a description of certain
transactions between the Company and BCP or BHLP and between Holdings and
BCP or BHLP.

Mr. Lindsay is also a member of the Compensation Committee of the
Holdings Board of Directors. The other members of such committee are
Messrs. Joseph H. Gleberman and Karl R. Wyss. Mr. Gleberman is a Partner
of Goldman Sachs and Mr. Wyss is a Managing Director of DLJ. The Holdings
Compensation Committee fixes the compensation paid to the Company's
executive officers, based in part on the recommendation of Mr. Craft. See
the information set forth under the caption "Certain Relationships and
Related Transactions" for a description of certain transactions between
the Company and DLJ and Goldman Sachs and their respective affiliates.
The Holdings Compensation Committee considers compensation of executive
officers of the Company to the extent it is paid by or affects Holdings,
as is the case when options to purchase Holdings stock are granted to
executive officers of Holdings.

Item 12. Security Ownership of Certain Beneficial Owners and Management

All of the issued and outstanding common stock of the Company is owned
beneficially and of record by Holdings. Holdings has pledged such stock
to the lenders under the Restated Credit Agreement in support of its
guarantee of the Company's obligations thereunder. In the event of a
default by Holdings of its obligations under such guarantee, the lenders
under the Restated Credit Agreement could exercise their powers under such
pledge and thereby obtain control of the Company.

The following table sets forth certain information regarding the
beneficial ownership of the common stock of Holdings as of February 28,
1994 by (i) each beneficial owner of more than 5% of the outstanding
common stock of Holdings, (ii) each director of Holdings, (iii) all
directors and officers of Holdings as a group, (iv) all directors and
officers of the Company as a group, and (v) all directors, officers and
management of the Company as a group.

Number of Shares Percentage Ownership
of Common Stock of Common Stock(1)
------------------------------------- -----------------------
Sole Shared Sole Shared
Voting Voting Voting Voting Com-
Name and Address Power Power Combined Power Power bined
---------------- --------- ----------- ---------- ------ ------ -----

Bessemer Holdings, 24,496,331 6,465,862(2) 30,962,193 69.7% 16.5%(2) 79.1%
L.P.(3)
630 Fifth Avenue
New York, NY 10111

GS Capital Partners, 6,615,448 - 6,615,448 17.7 - 17.7
L.P.(4)
85 Broad Street
New York, NY 10004

DLJ International 5,487,925 - 5,487,925 14.2 - 14.2
Partners, C.V.(5)
140 Broadway
New York, NY 10005

Stanley C. Craft(6) - 883,000 883,000 - 2.5 2.5
1601 Wall Street
Fort Wayne, IN 46802

All directors and - 29,900,910 29,900,910 - 77.6 77.6
officers of Holdings
as a group
(6 persons)(7)

All directors and - 29,900,910 29,900,910 - 77.6 77.6
officers of the
Company as a group
(9 persons)(8)

All directors, officers - 29,900,910 29,900,910 - 77.6 77.6
and management of the
Company as a group
(43 persons)(9)

(1) Percentages have been calculated assuming, in the case of each person
or group listed, the exercise of all warrants and options owned
(which are exercisable within sixty days following February 28, 1994)
by each such person or group, respectively, but not the exercise of
any warrants or options owned by any other person or group listed.

(2) BHLP is a limited partnership the only activity of which is to make
private structured investments. The primary limited partner of BHLP
is Bessemer Securities Corporation ("BSC"), a corporation owned by
trusts whose beneficiaries are descendants of Henry Phipps and
charitable trusts established by such descendants. Each of Messrs.
Ward W. Woods and Robert D. Lindsay, directors of Holdings, and Mr.
Michael B. Rothfeld, is a sole shareholder of a corporation which is

a general partner of the limited partnership which is the sole
general partner of BHLP. In addition, each of Messrs. Woods, Lindsay
and Rothfeld are the sole shareholders of corporations which are the
general partners of each of the partnerships affiliated with BHLP and
BCP, respectively, to which the Company and Holdings paid the fees
described under Item 13 below. Mr. Woods is the President and Chief
Executive Officer of BSC. Each of Messrs. Woods, Lindsay and
Rothfeld disclaim beneficial ownership of the shares of common stock
of Holdings owned or controlled by BHLP.

(3) Consists of (a) all shares of common stock owned by officers,
employees and retirees of the Company and its subsidiaries, or their
respective estates (a total of 2,469,262 shares), which shares are
subject to a proxy held by BHLP which provides that BHLP may vote
such shares on all matters presented to stockholders other than (i)
the sale or merger of Holdings or the Company; (ii) any amendment to
the certificate of incorporation of Holdings which would adversely
affect the terms of the common stock and (iii) the election of
directors in the event that BHLP does not include at least one member
of management of the Company in its nominees for directors of
Holdings and (b) all shares of common stock issuable upon exercise of
options held by officers, employees and retirees of the Company and
its subsidiaries, or their respective estates (a total of 3,996,600
shares). Pursuant to the terms of the applicable options agreements,
the aggregate number of shares issuable upon exercise of such options
can be reduced to approximately 2,558,591 shares. All shares
issuable upon exercise of the foregoing options are subject to the
proxy held by BHLP.

(4) Held by GS Capital Partners, L.P. (an affiliate of Goldman, Sachs)
and certain of its affiliates, and includes 2,241,103 shares issuable
upon exercise of warrants.

(5) Includes 3,425,635 shares issuable upon exercise of warrants held by
affiliates and employees of DLJ.

(6) Includes 583,000 shares issuable upon exercise of options held by Mr.
Craft, which, pursuant to the applicable option agreement, may be
reduced to 377,405 shares. All shares owned by Mr. Craft and all
shares issuable to Mr. Craft upon exercise of options are subject to
the proxy described in footnote (3) above. Mr Craft is the only
director of Holdings who is a record owner of common stock.

(7) Consists of (a) the 24,496,331 shares of common stock owned by BHLP,
which, together with the shares described in (b), (c) and (d) below,
may be deemed to be beneficially owned by Messrs. Woods and Lindsay
(which beneficial ownership is disclaimed by Messrs. Woods and
Lindsay see footnote (2) above), (b) 550,637 shares of common stock
owned by the officers of Holdings included in this group, (c) 741,578
shares issuable to the officers of Holdings included in this group
upon exercise of options which, pursuant to the applicable option
agreements, may be reduced and (d) 1,481,742 shares of common stock
and 2,630,622 shares of common stock issuable upon exercise of
options (also subject to reduction) owned by, other employees of the
Company. All shares described in (b), (c) and (d) are subject to the
proxy described in footnote (3) above.

(8) Consists of (a) 24,496,331 shares of common stock owned by BHLP,
which, together with the shares described in (b), (c) and (d) below,
may be deemed to be beneficially owned by Messrs. Woods and Lindsay
(which beneficial ownership is disclaimed by Messrs. Woods and
Lindsay see footnote (2) above), (b) 1,130,583 shares of common stock
owned by the other directors and officers of the Company included in
this group, (c) 1,782,750 shares issuable to the other directors and
officers of the Company included in this group upon exercise of
options which, pursuant to the applicable option agreements, may be
reduced and (d) 901,796 shares of common stock owned by and 1,589,450
shares of common stock issuable upon exercise of options (also
subject to reduction) owned by, other employees of the Company. All
shares described in (b), (c) and (d) are subject to the proxy
described in footnote (3) above.

(9) Consists of (a) the 24,496,331 shares of common stock owned by BHLP,
which, together with the shares described in (b) and (c) below, may
be deemed to be beneficially owned by Messrs. Woods and Lindsay
(which beneficial ownership is disclaimed by Messrs. Woods and
Lindsay see footnote (2) above), (b) 2,032,379 shares of common stock
owned by other directors, officers and members of management of the
Company included in this group and (c) 3,372,200 shares issuable to
other directors, officers and members of management of the Company
included in this group upon exercise of options which, pursuant to
the applicable options agreements, may be reduced. All shares
described in (b) and (c) are subject to the proxy described in
footnote (3) above.

Management Stockholder Agreements

The members of the Company's management who are stockholders of Holdings
(each a "Management Stockholder") are parties to various agreements, each
dated as of October 9, 1992, pertaining to their ownership of Holdings'
common stock and options therefor. Set forth below is a summary of
certain provisions of these agreements, each of which is filed as an
exhibit to this Annual Report. Capitalized terms set forth below and not
otherwise defined have the meanings assigned thereto in the relevant
agreements.

Management Stockholders and Registration Rights Agreement. The
Management Stockholders and Registration Rights Agreements generally
prohibit Management Stockholders from transferring shares of common stock
of Holdings owned by them before the earlier of (i) an initial public
offering by Holdings (or any successor thereto) (an "IPO") and (ii)
October 9, 1996. Thereafter, if any Management Stockholder receives a
bona fide offer to purchase any of his common stock, such Management
Stockholder may transfer such common stock only after offering such common
stock first to Holdings and then, if not accepted by Holdings, to BHLP, in
each case on the same terms and conditions as such bona fide offer.

Any Management Stockholder who retires from the Company, dies or becomes
disabled prior to the earlier of (i) an IPO and (ii) October 9, 1996, will
have a "put right" for 90 days (180 days in case of death) by which he, or
his estate may require Holdings to repurchase all his shares of common
stock of Holdings at a price equal, at the option of Holdings, to (i) the
higher of (x) the last price paid by BHLP, Holdings or a Management
Stockholder for shares of common stock of Holdings and (y) approximately
$2.86 per share or (ii) the fair market value of the shares of common

stock of Holdings as determined by an independent appraiser or investment
banking firm selected by the Board of Directors of Holdings (the value
determined pursuant to clause (i) or (ii) being the "Fair Market Value").
Holdings will be required to repurchase such shares at such price, unless
such repurchase would violate any applicable law or regulation or any
agreement pursuant to which Holdings incurred any debt, in which case
Holdings may defer such repurchase until such repurchase would no longer
result in any such violation. Holdings will have a "call right" for 365
days by which it can repurchase, at Fair Market Value, any or all of the
shares of common stock of Holdings belonging to the Management Stockholder
or his estate if, prior to the earlier of (i) an IPO and (ii) October 9,
1996, the Management Stockholder's employment is terminated for any
reason, whether due to his retirement, resignation, death, disability or
otherwise. Under certain circumstances, Holdings may pay the purchase
price of any common stock of Holdings repurchased from a Management
Stockholder pursuant to the put rights and call rights described above by
delivery of a subordinated note.

Management Stockholders also have certain "piggyback" registration rights
in the event that Holdings registers shares of its common stock for sale
under the Securities Act of 1933.

Stock Option. Grants of options to purchase common stock of Holdings
have been made to management and employees of the Company pursuant to, and
are subject to the provisions of, an Amended and Restated Stock Option
Plan and individual stock option agreements. All outstanding options are
presently exercisable. According to the terms of the foregoing plan and
form of agreement, any options granted in the future thereunder will
become exercisable upon the occurrence of: (i) the passage of 3 years;
(ii) the death, retirement or disability of the optionee; (iii) a Company
Sale (which shall be deemed to have occurred if any person becomes the
beneficial owner of 50% or more of the combined voting power of Holdings'
securities or acquires substantially all the assets of Holdings or the
Company), in proportion to the percentage of Holdings' common stock sold;
or(iv) the sale by BHLP (as successor in interest to BCP) of 25% or more
of the then outstanding common stock of Holdings, in each case in
proportion to the percentage of Holdings stock sold by BHLP. Such options
are generally not transferable. Options owned by Management Stockholders
are subject to the same put rights and call rights applicable to shares of
common stock owned by Management Stockholders.

Holdings may require that an option be surrendered and cancelled without
payment of the exercise price. In this event, the optionee is entitled to
receive a number of shares of Holdings common stock equal to the number
specified in the grant, reduced by the quotient of the aggregate exercise
price otherwise payable and the fair market value per share as of October
9, 1992.

Investors Shareholders Agreement

Set forth below is a summary of certain terms of the Investors
Shareholders Agreement among Holdings, BHLP (as successor in interest to
BCP), affiliates of Donaldson, Lufkin & Jenrette Securities Corporation
("DLJ"), affiliates of Goldman Sachs and CEA. Capitalized terms used
below and not otherwise defined have the meaning assigned thereto in the
Investors Shareholders Agreement.

Holdings, BHLP, certain affiliates of DLJ, certain affiliates of Goldman
Sachs and CEA (collectively, the "Investor Shareholders") are parties to
an Investors Shareholders Agreement that provides restrictions on the
transferability of Holdings' common stock and other matters, certain of
which are summarized below.

Board of Directors. The Investors Shareholders Agreement provides that
the Board of Directors of Holdings shall consist of seven directors. BHLP
has the right to nominate five directors, at least one of whom will be a
member of all committees of the Board of Directors of Holdings and at
least one of whom will be a member of the management of the Company. The
Board of Directors of Holdings currently includes four BHLP nominees,
including Mr. Stanley C. Craft, Chief Executive Officer of the Company and
Holdings. Similarly, so long as affiliates of DLJ and affiliates of
Goldman Sachs hold at least a specified minimum percentage of the shares
of common stock of Holdings and Series A Preferred Stock originally
purchased by them (and under certain other limited circumstances), the
affiliates of DLJ have the right to nominate one director and the
affiliates of Goldman Sachs have the right to nominate one director, each
of whom will be a member of all of Holdings' Board Committees.

Each of the Investor Shareholders is required to vote all of its voting
shares in favor of the directors so nominated. If any vacancy is created
on the Board of Directors of Holdings, it will be filled in accordance
with the foregoing nomination procedures.

Significant Business Decisions. The Investors Shareholders Agreement
provides that certain specified significant transactions require approval
of the Holdings Board of Directors. In addition, amendments to Holdings'
Certificate of Incorporation and By-laws that adversely affect the terms
of the common stock, amendments to the Investors Shareholders Agreement,
certain significant acquisitions, dispositions, the incurrence of debt
beyond specified amounts and certain transactions with affiliates require,
in addition to the approval of a majority of the Board of Directors of
Holdings, the approval of at least one BHLP-nominated director and, so
long as the affiliates of DLJ or the affiliates of Goldman Sachs hold at
least a specified minimum investment in Holdings, one director nominated
by the affiliates of DLJ or by the affiliates of Goldman Sachs.

Other Rights. The Investors Shareholders Agreement also includes various
rights of first offer, tag-along and pre-emptive rights among the Investor
Shareholders. Holdings and the Investor Shareholders are also parties to
registration rights agreements relating to Holdings' common stock.

Item 13. Certain Relationships and Related Transactions

The Company incurred advisory fees of approximately $1.0 million and $0.2
million payable to affiliates of BHLP and BCP in 1993 and 1992,
respectively. Pursuant to an advisory services agreement among Holdings,
the Company and an affiliate of BHLP, the Company agreed to pay such
affiliate an annual advisory fee of $1.0 million. The Company also
incurred advisory fees of $0.2 million and $0.3 million in 1992 and 1991,
respectively payable to Morgan Stanley & Co., Incorporated, an affiliate
of the former controlling shareholder of Holdings. In addition, the
Company incurred management fees to Holdings of $1.9 million and $3.5
million in 1992 and 1991, respectively. No such fee was incurred in 1993.

In connection with the Acquisition, the Company paid to an affiliate of
BCP a financial advisory fee of approximately $1.9 million and to Morgan
Stanley & Co. Incorporated a financial services fee of approximately $3.6
million and Holdings paid to an affiliate of BCP an acquisition advisory
fee of approximately $1.9 million. See footnote (2) under Item 12 above
for a description of the relationship of Messrs. Woods and Lindsay,
directors of the Company, with such BCP affiliate.

Pursuant to an engagement letter dated July 22, 1992 among BCP, BE and
DLJ, as amended by a letter agreement dated October 9, 1992 among BCP, BE,
DLJ and Goldman Sachs (collectively, the "Engagement Letter"), Holdings
paid DLJ a financial advisory fee of $1.0 million upon consummation of the
Acquisition. In addition, Holdings paid an affiliate of DLJ a $1.0
million commitment fee in connection with its commitment to purchase
Series A Preferred Stock of BE.

The Engagement Letter also gives DLJ and Goldman Sachs the right, but not
the obligation, subject to certain conditions, to act as financial advisor
to the Company and Holdings until the fifth anniversary of the Acquisition
on a co-exclusive basis in connection with all acquisition, divestiture
and other financial advisory assignments relating to Holdings or the
Company and to act as co-exclusive managing placement agents or co-
exclusive managing underwriters in connection with any debt or equity
financing which is either privately placed or publicly offered (excluding
commercial bank debt or other senior debt which is privately placed other
than any private placement which contemplates a registration of,
registered exchange offer for, or similar registration with respect to
such securities). In connection with any other senior debt financing
which is privately placed (excluding any private placement of senior debt
which contemplates a registration, registered exchange offer for, or
similar registration with respect to such securities), DLJ has the right,
but not the obligation, to act as co-managing placement agent or co-
managing underwriter, together only with Chemical Bank. Holdings has
retained the right to designate DLJ or Chemical Bank as lead placement
agent or lead managing underwriter.

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

PART IV

Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K

(a) 1. Financial Statements

The financial statements listed under Item 8 are filed as a
part of this report.

2. Financial Statement Schedules

The financial statement schedules listed under Item 8 are
filed as a part of this report.

3. Exhibits

The exhibits listed on the accompanying Index to Exhibits
are filed as a part of this report.

(b) No reports on Form 8-K were filed by the Company during the
fourth quarter of 1993.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.

ESSEX GROUP, INC.
Date (Registrant)

March 29, 1994 By /s/ David A. Owen
______________ _____________________________________
David A. Owen
Vice President Finance, Treasurer and
Chief Financial Officer; Director
(Principal Financial Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

Date

March 29, 1994 /s/ Stanley C. Craft
______________ _______________________________________
Stanley C. Craft
President and Chief Executive Officer;
Director
(Principal Executive Officer)

March 29, 1994 /s/ David A. Owen
______________ _______________________________________
David A. Owen
Vice President Finance, Treasurer and
Chief Financial Officer; Director
(Principal Financial Officer)

March 29, 1994 /s/ Steven R. Abbott
______________ _______________________________________
Steven R. Abbott
Director

March 29, 1994 /s/ John L. Cox
______________ _______________________________________
John L. Cox
Director

March 29, 1994 /s/ Robert J. Faucher
______________ _______________________________________
Robert J. Faucher
Director

March 29, 1994 /s/ Thomas A. Twehues
______________ _______________________________________
Thomas A. Twehues
Director

March 29, 1994 /s/ Robert D. Lindsay
______________ _______________________________________
Robert D. Lindsay
Director

March 29, 1994 /s/ Ward W. Woods, Jr.
______________ _______________________________________
Ward W. Woods, Jr.
Director

March 29, 1994 /s/ James D. Rice
______________ _______________________________________
James D. Rice
Vice President and Corporate Controller
(Principal Accounting Officer)

ESSEX GROUP, INC.

INDEX OF EXHIBITS
(Item 14(a)(3))

Exhibit
No. Description
--------------------------------------------------------------------------

2.01 Agreement and Plan of Merger, dated as of July 24, 1992 (the
"Merger Agreement"), between B E Acquisition Corporation and
BCP/Essex Holdings Inc. (then known as MS/Essex Holdings Inc.),
incorporated by reference to Exhibit 2.1 to BCP/Essex Holdings
Inc.'s (then known as MS/Essex Holdings Inc.) Current Report on
Form 8-K, filed with the Securities and Exchange Commission on
August 10, 1992 (Commission File No. 1-10211).
2.02 Amendment dated as of October 1, 1992, to the Agreement and Plan
of Merger between B E Acquisition Corporation and BCP/Essex
Holdings Inc. (then known as MS/Essex Holdings Inc.), incorporated
by reference to Exhibit 2.2 to BCP/Essex Holdings Inc.'s Current
Report on Form 8-K, filed with the Securities and Exchange
Commission on October 26, 1992 (Commission File No. 1-10211).
3.01 Certificate of Incorporation of the registrant (Incorporated by
reference to Exhibit 3.01 to the Company's Registration Statement
on Form S-1, File No. 33-20825).
3.02 By-Laws of the registrant, as amended. (Incorporated by reference
to Exhibit 3.02 to the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1991).
4.01 Indenture under which the 10% Senior Notes Due 2003 are
outstanding, incorporated by reference to Exhibit 4.1 to the
Company's Registration Statement on Pre-Effective Amendment No. 1
to Form S-2 (Commission File No. 33-59488).
9.01 Investors Shareholders Agreement dated as of October 9, 1992,
among B E Acquisition Corporation, Bessemer Capital Partners,
L.P., certain affiliates of Donaldson, Lufkin & Jenrette, Inc.,
certain affiliates of Goldman, Sachs & Co., and Chemical Equity
Associates, a California Limited Partnership, incorporated by
reference to Exhibit 28.1 to BCP/Essex Holdings Inc.'s Current
Report on Form 8-K, filed with the Securities and Exchange
Commission on October 26, 1992 (Commission File No. 1-10211).
9.02 Management Stockholders and Registration Rights Agreement dated as
of October 9, 1992, among B E Acquisition Corporation, Bessemer
Capital Partners, L.P. and certain employees of the registrant and
its subsidiaries, incorporated by reference to Exhibit 28.3 to
BCP/Essex Holdings Inc.'s Current Report on Form 8-K, filed with
the Securities and Exchange Commission on October 26, 1992
(Commission File No. 1-10211).
9.03 Form of Irrevocable Proxy dated as of October 9, 1992, granted to
Bessemer Capital Partners, L.P. by certain employees of the
registrant and its subsidiaries, incorporated by reference to
Exhibit 28.4 to BCP/Essex Holdings Inc.'s Current Report on Form
8-K, filed with the Securities and Exchange Commission on October
26, 1992 (Commission File No. 1-10211).
10.01 Amendment and Restatement of Credit Agreement dated May 7, 1993,
incorporated by reference to Exhibit 28.7 to the Company's
Registration Statement on Pre-Effective Amendment No. 3 to Form
S-2 (Commission File No. 33-59488).

Exhibit
No. Description
--------------------------------------------------------------------------

10.02 Credit Agreement dated as of September 25, 1992, among B E
Acquisition Corporation, BCP/Essex Holdings Inc., the registrant,
the lenders named therein and Chemical Bank, as agent,
incorporated by reference to Exhibit 4.6 to BCP/Essex Holdings
Inc.'s Current Report on Form 8-K, filed with the Securities and
Exchange Commission on October 26, 1992 (Commission File No.
1-10211).
10.03 Engagement Letter dated July 22, 1992 among Bessemer Capital
Partners, L.P., B E Acquisition Corporation, and Donaldson, Lufkin
& Jenrette, Inc., incorporated by reference to Exhibit 10.10 to
registrant's Annual Report on Form 10-K for the year ended
December 31, 1992 (Commission File No. 1-7418).
10.04 Amendment dated October 9, 1992 among Bessemer Capital Partners,
L.P., B E Acquisition Corporation, Donaldson, Lufkin & Jenrette,
Inc. and Goldman, Sachs and Co., to Engagement Letter dated July
22, 1992 among Bessemer Capital Partners, L.P., B E Acquisition
Corporation and Donaldson, Lufkin & Jenrette, Inc., incorporated
by reference to Exhibit 10.11 to registrant's Annual Report on
Form 10-K for the year ended December 31, 1992 (Commission File
No. 1-7418).
12.01 Computation of Ratio of Earnings to Fixed Charges.
22.01 Subsidiaries of the registrant.
99.01 Registration Rights Agreement dated as of October 9, 1992, among
B E Acquisition Corporation, certain affiliates of Donaldson,
Lufkin & Jenrette, Inc., certain affiliates of Goldman, Sachs &
Co., and Chemical Equity Associates, A California Limited
Partnership, incorporated by reference to Exhibit 28.2 to
BCP/Essex Holdings Inc.'s Current Report on Form 8-K, filed with
the Securities and Exchange Commission on October 26, 1992
(Commission File No. 1-10211).
99.02 Amended and Restated Stock Option Plan of BCP/Essex Holdings Inc.,
incorporated by reference to Exhibit 4.7 to BCP/Essex Holdings
Inc.'s Current Report on Form 8-K, filed with the Securities and
Exchange Commission on October 26, 1992 (Commission File No. 1-
10211).

REPORT OF INDEPENDENT AUDITORS

The Board of Directors and Stockholder
Essex Group, Inc.

We have audited the accompanying consolidated balance sheets of Essex
Group, Inc. Successor as of December 31, 1993 and 1992 and the related
consolidated statements of operations and cash flows of Essex Group,
Inc. Successor for the year ended December 31, 1993 and the three month
period ended December 31, 1992, and the consolidated statements of
operations and cash flows of Essex Group, Inc. Predecessor for the nine
month period ended September 30, 1992 and the year ended December 31,
1991. Our audits also included the financial statement schedules listed
in the Index at Item 14 (a). These financial statements and schedules are
the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements and schedules based on
our audits.

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

In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Essex
Group, Inc. Successor at December 31, 1993 and 1992 and the consolidated
results of operations and cash flows of Essex Group, Inc. Successor for
the year ended December 31, 1993, and the three month period ended
December 31, 1992, and of Essex Group, Inc. Predecessor for the nine month
period ended September 30, 1992 and the year ended December 31, 1991, in
conformity with generally accepted accounting principles. Also, in our
opinion, the related financial statement schedules, when considered in
relation to the basic financial statements taken as a whole, present
fairly in all material respects the information set forth therein.

ERNST & YOUNG

Indianapolis, Indiana
January 28, 1994

F-1

ESSEX GROUP, INC.

CONSOLIDATED BALANCE SHEETS

December 31,
---------------------------
In Thousands of Dollars, Except Per Share Data 1993 1992
--------------------------------------------------------------------------------------

ASSETS

Current assets:
Cash and cash equivalents . . . . . . . . . . . . . . $ 10,346 $ 9,033
Accounts receivable (net of allowance of
$2,811 and $2,455 . . . . . . . . . . . . . . . . . . 116,733 112,269
Inventories . . . . . . . . . . . . . . . . . . . . . 139,357 133,698
Other current assets . . . . . . . . . . . . . . . . . 9,738 13,915
-------- --------

Total current assets . . . . . . . . . . . . . 276,174 268,915

Property, plant and equipment, net . . . . . . . . . . . 273,084 272,305
Excess of cost over net assets acquired (net of
accumulated amortization of $5,081 and $1,046) . . . . . 137,164 141,199
Other intangible assets and deferred costs
(net of accumulated amortization of $2,986
and $4,334) . . . . . . . . . . . . . . . . . . . . . . 13,921 18,372
Other assets . . . . . . . . . . . . . . . . . . . . . . 6,654 2,356
-------- --------

$706,997 $703,147
======== ========

See Notes to Consolidated Financial Statements

F-2

ESSEX GROUP, INC.

CONSOLIDATED BALANCE SHEETS - continued

December 31,
---------------------------
In Thousands of Dollars, Except Per Share Data 1993 1992
--------------------------------------------------------------------------------------

LIABILITIES AND STOCKHOLDER'S EQUITY

Current liabilities:
Current portion of long-term debt . . . . . . . . . . $ - $ 40,000
Accounts payable . . . . . . . . . . . . . . . . . . . 45,535 45,322
Accrued liabilities . . . . . . . . . . . . . . . . . 42,863 43,597
Deferred income taxes . . . . . . . . . . . . . . . . 14,277 15,986
Due to Holdings . . . . . . . . . . . . . . . . . . . 18,363 75
-------- --------

Total current liabilities . . . . . . . . . . . 121,038 144,980

Long-term debt . . . . . . . . . . . . . . . . . . . . . 200,000 181,289
Deferred income taxes . . . . . . . . . . . . . . . . . . 77,794 76,707
Other long-term liabilities . . . . . . . . . . . . . . . 4,433 2,449

Stockholder's equity:
Common stock, par value $.01 per share; 1,000 shares
authorized; 100 shares issued and outstanding; plus
additional paid in capital . . . . . . . . . . . . . 302,784 302,784
Retained earnings (deficit) . . . . . . . . . . . . . 948 (5,062)
-------- --------

Total stockholder's equity . . . . . . . . . . 303,732 297,722
-------- --------

$706,997 $703,147
======== ========

See Notes to Consolidated Financial Statements

F-3

ESSEX GROUP, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

SUCCESSOR PREDECESSOR
-------------------------- -------------------------
Three Month Nine Month
Year Ended Period Ended Period Ended Year Ended
December 31, December 31, September 30, December 31,

In Thousands of Dollars 1993 1992 1992 1991
--------------------------------------------------------------------------------------

REVENUES:
Net sales $868,846 $209,354 $699,997 $885,492
Interest income 265 88 73 425
Other income 1,724 87 921 1,541
-------- -------- -------- --------

870,835 209,529 700,991 887,458
-------- -------- -------- --------
COSTS AND EXPENSES:
Cost of goods sold 745,875 186,026 594,122 753,077
Selling and administrative 75,489 22,349 59,609 80,227
Interest expense 25,241 8,086 14,505 24,969
Other expense (income) 1,801 30 (98) 1,444
Merger related expenses - - 18,139 -
-------- -------- -------- --------
848,406 216,491 686,277 859,717
-------- -------- -------- --------
Income (loss) before income
taxes and extraordinary charge 22,429 (6,962) 14,714 27,741
Provision (benefit) for income
taxes 13,052 (1,900) 9,278 13,241
-------- -------- -------- --------

Income (loss) before
extraordinary charge 9,377 (5,062) 5,436 14,500
Extraordinary charge - debt
retirement, net of income tax
benefit 3,367 - 122 1,471
-------- -------- -------- --------

Net income (loss) $ 6,010 $ (5,062) $ 5,314 $ 13,029
======== ======== ======== ========

See Notes to Consolidated Financial Statements

F-4

ESSEX GROUP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

SUCCESSOR PREDECESSOR
------------------------- -------------------------
Three Month Nine Month
Year Ended Period Ended Period Ended Year Ended
December 31, December 31, September 30, December 31,

In Thousands of Dollars 1993 1992 1992 1991
--------------------------------------------------------------------------------------

OPERATING ACTIVITIES
Net income (loss) $6,010 $(5,062) $5,314 $13,029
Adjustments to reconcile net
income (loss) to cash
provided by operating
activities:
Depreciation and
amortization 29,879 8,743 16,913 22,390
Non cash interest expense 4,968 3,251 1,460 1,696
Non cash pension expense 2,124 591 2,852 2,739
Provision (credit) for
losses on accounts
receivable 850 75 (1,848) 1,210
Provision (benefit) for
deferred income taxes (622) (1,581) 1,267 164
(Gain) loss on disposal of
property, plant and
equipment 436 (44) (389) 1,091
Loss on repurchase of debt 5,519 - 200 2,412

Changes in operating assets
and liabilities:
(Increase) decrease in
accounts receivable (5,314) 18,275 (24,426) 7,480
(Increase) decrease in
inventories (5,659) (863) (5,130) 10,907
Increase (decrease) in
accounts payable and
accrued liabilities (720) 1,750 10,901 5,108
Net (increase) decrease in
other assets and
liabilities 4,908 (2,347) (2,589) (5,606)
Increase (decrease) in due
to Holdings 18,288 (12,017) 18,128 8,182
-------- -------- -------- --------

NET CASH PROVIDED BY
OPERATING ACTIVITIES 60,667 10,771 22,653 70,802
-------- -------- -------- --------

See Notes to Consolidated Financial Statements

F-5

ESSEX GROUP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

SUCCESSOR PREDECESSOR
------------------------- --------------------------
Three Month Nine Month
Year Ended Period Ended Period Ended Year Ended
December 31, December 31, September 30, December 31,

In Thousands of Dollars 1993 1992 1992 1991
--------------------------------------------------------------------------------------
INVESTING ACTIVITIES
Additions to property, plant
and equipment (26,167) (14,705) (16,475) (13,242)
Proceeds from disposal of
property, plant and
equipment 352 45 2,179 458
Investment in subsidiary and
joint venture (4,970) - (1,220) (470)
-------- --------- -------- --------
NET CASH USED FOR
INVESTING ACTIVITIES (30,785) (14,660) (15,516) (13,254)
-------- -------- -------- --------

FINANCING ACTIVITIES
Proceeds from senior notes 200,000 - - -
Proceeds from term loan - 130,000 - -
Retire prior indebtedness - (94,000) - -
Net increase (decrease) in
revolving loan (11,000) 11,000 33,000 9,000
Net payments of other
long-term debt (120,500) (9,500) (34,540) (20,886)
Repurchase of 12 3/8% senior
subordinated debentures (89,983) (11,692) (2,291) (43,245)
Cash dividends paid - (7,500) - (5,000)
Debt issuance costs (7,086) (17,232) (653) -
-------- -------- -------- --------
NET CASH PROVIDED BY
(USED FOR) FINANCING
ACTIVITIES (28,569) 1,076 (4,484) (60,131)
-------- -------- -------- --------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 1,313 (2,813) 2,653 (2,583)
Cash and cash equivalents at
beginning of period 9,033 11,846 9,193 11,776
-------- -------- -------- --------
Cash and cash equivalents at
end of period $10,346 $9,033 $11,846 $9,193
======== ======== ======== ========

See Notes to Consolidated Financial Statements

F-6

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In Thousands of Dollars
-----------------------

NOTE 1 ORGANIZATION AND ACQUISITION

Acquisition of the Company

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

On October 9, 1992, Holdings was acquired (the "Acquisition") by merger
(the "Merger") of B E Acquisition Corporation ("BE") with and into
Holdings with Holdings surviving under the name BCP/Essex Holdings Inc.
("Successor"). BE was a newly organized Delaware corporation formed for
the purpose of effecting the Acquisition. Shareholders of BE include
affiliates of Bessemer Capital Partners, L.P. ("BCP"), Goldman, Sachs &
Co. ("Goldman Sachs"), Donaldson, Lufkin & Jenrette, Inc. ("DLJ"),
Chemical Equity Associates, A California Limited Partnership and members
of management and other employees of the Company. Pursuant to the
Acquisition and Merger, (i) stockholders of Holdings, prior to the
Acquisition and Merger, became entitled to receive approximately $2.86 for
each outstanding share of common stock of Holdings held by them, (ii)
holders of options to purchase Holdings common stock, other than those
persons entering into an option continuation agreement, became entitled to
receive the difference between approximately $2.86 per share and the per
share exercise price of such options and (iii) the capital stock of BE was
converted into capital stock of Holdings. The Acquisition and Merger
resulted in a change in control of Holdings. Further, the Acquisition and
Merger occurred at the Holdings level and, therefore, did not directly
affect the Company's status as a wholly-owned subsidiary of Holdings. In
December 1993, BCP transferred its ownership interest in Holdings to
Bessemer Holdings, L.P. ("BHLP") an affiliate of BCP.

In connection with the Acquisition and Merger, the Company recorded
certain merger related expenses of $18,139 consisting primarily of bonus
and option payments to certain employees, and certain merger fees and
expenses, which were charged to operations as of September 30, 1992.

F-5

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

subsequent to September 30, 1992 are presented on the Successor's new
basis of accounting, while the financial statements for September 30, 1992
and prior periods are presented on the Predecessor's historical cost basis
of accounting.

The aggregate purchase price of Holdings and a reconciliation to the
initial capitalization of Successor are as follows:

Purchase price, including related fees:

Purchase price, excluding Seller's expenses . . . . $138,445
Related fees and expenses . . . . . . . . . . . . . 6,168
--------
144,613

Less reduction to reflect proportionate historical
cost basis for management's continuing common stock
interest . . . . . . . . . . . . . . . . . . . . . (15,259)
--------

129,354
Holdings debt ($191,645) and deferred debt
issuance costs, deferred and refundable income
taxes and other minor Holdings amounts not
reflected in Successor financial statements
(See Note 9) . . . . . . . . . . . . . . . . . . . 173,430
--------

Initial capitalization of Successor . . . . . . . . $302,784
========

The allocation of the purchase price to historical assets and liabilities
of the Company was as follows:

Net assets at prior historical cost . . . . . . . . . . . . . . . . . . $132,257
Increase in inventories . . . . . . . . . . . . . . . . . . . . . . . . 18,959
Increase in property, plant and equipment . . . . . . . . . . . . . . . 98,131
Deferred debt expense and changes in other assets and liabilities . . . 1,335
Long-term debt premium . . . . . . . . . . . . . . . . . . . . . . . . (5,812)
Adjust deferred income taxes to new basis . . . . . . . . . . . . . . . (84,331)
Excess of cost over net assets acquired . . . . . . . . . . . . . . . . 142,245
--------
$302,784
========

F-6

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

The following unaudited pro forma consolidated results of operations for
the twelve month periods ended December 31, 1992 and 1991 are presented
assuming the Acquisition and Merger had occurred on January 1, 1991 (no
affect on revenues):

1992 1991
----------------------------

Income (loss) before extraordinary charge . . . $(6,014) $ 477
======== ========

Net Income (loss) . . . . . . . . . . . . . . . $(6,026) $ 331
======== ========

The primary pro forma effects are revised depreciation and amortization
charges, interest expense and income taxes. The pro forma information
does not purport to present what the Company's consolidated results of
operations would actually have been if the Acquisition and Merger had
occurred on January 1, 1991 and is not intended to project future results
of operations.

NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Consolidation and business segment

The consolidated financial statements include the accounts of the Company
and all majority-owned subsidiaries. All intercompany accounts and
transactions have been eliminated in consolidation. The Company operates
in one industry segment. The Company develops, manufactures and markets
electrical wire and cable and insulation products. Among the Company's
products are magnet wire for electromechanical devices such as motors,
transformers and electrical controls; building wire for the construction
industry; telephone cable for the telecommunications industry; wire for
automotive and appliance applications; and insulation products for the
electrical industry. The Company's customers are principally located
throughout the United States, without significant concentration in any one
region or any one customer. The Company performs periodic credit
evaluations of its customers' financial condition and generally does not
require collateral.

Fair value of financial instruments

The Company's financial instruments consist of cash and cash equivalents,
investment securities and the Company's long-term debt. The carrying
amounts of the Company's financial instruments approximate fair value at
December 31, 1993.

F-7

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

Cash and cash equivalents

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

Inventories

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

Property, plant and equipment

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

Investment in joint venture

An investment in a joint venture is stated at cost adjusted for the
Company's share of undistributed earnings or losses.

Investment in subsidiary

In late 1993, the Company acquired a majority interest in Interstate
Industries, Inc. for cash of $4,300, subject to final purchase price
adjustments and the minority interest ownership percentage. At December
31, 1993, the acquisition is included in other assets; consolidation of
this subsidiary would not have a significant effect on the 1993
consolidated financial statements.

Income taxes

Effective October 1, 1992, concurrent with the new basis of accounting,
the Successor adopted Statement of Financial Accounting Standards No. 109,
"Accounting for Income Taxes," ("FAS 109"). FAS 109 requires recognition
of deferred tax liabilities and assets for the expected future tax
consequences of events that have been included in the financial statements
or tax returns. Using this method, deferred tax liabilities and assets
are determined based on the difference between the financial statement and
tax bases of assets and liabilities. These deferred taxes are measured by
applying current tax laws. Through September 30, 1992, deferred income
taxes were provided by Predecessor for significant timing differences in
the recognition of revenue and expense for tax and financial statement
purposes.

Holdings and the Company file a consolidated U.S. federal income tax
return. The Company operates under a tax sharing agreement with Holdings
whereby the Company's aggregate income tax liability is calculated as if
it filed a separate tax return with its subsidiaries.

F-8

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

Excess of cost over net assets acquired

Excess of cost over net assets acquired represents the excess of the
Holdings contribution to capital, based on its purchase price over the
fair value of the net assets acquired in the Acquisition, and is being
amortized by the straight-line method over 35 years.

Other intangible assets

In connection with the 1988 Acquisition, a covenant not to compete
agreement was entered into whereby, in general, UTC agreed that until
March 1, 1993, it would not engage in or carry on any business directly
competing with any business carried on by the Company on February 29,
1988. The $34,000 purchase price allocated by the Predecessor to the
covenant not to compete was classified as an intangible asset and was
amortized over five years through February 1993.

Recognition of revenue

Substantially all of the Company's revenue is recognized at the time the
product is shipped.

Postretirement and postemployment benefits

In 1993, the Company adopted Statement of Financial Accounting Standards
No. 106 "Employers' Accounting for Postretirement Benefits Other Than
Pensions" and Statement of Financial Accounting Standards No. 112
"Employers' Accounting for Postemployment Benefits". The effect of
adopting the new rules was not material to the Company's 1993 consolidated
results of operations or financial condition.

Unusual items

Included in Successor's cost of goods sold for the three month period
ended December 31, 1992 is a charge of approximately $2,600 to reflect the
estimated cost of anticipated plant consolidations, primarily costs to
move equipment and personnel related expenses. In the nine month period
ended September 30, 1992, Predecessor recorded a charge of approximately
$1,500 to selling and administrative expenses for the relocation of a
business unit which was completed in 1993. During 1991, Predecessor
settled a warranty claim resulting in a charge of approximately $1,700 to
selling and administrative expenses.

F-9

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

NOTE 3 INVENTORIES

The components of inventories are as follows:

December 31,
-------------------------------
1993 1992
---------- ----------

Finished goods . . . . . . . . . . . . . . $97,332 $95,566
Raw materials and work in process . . . . . 27,927 39,478
-------- --------
125,259 135,044
LIFO reserve . . . . . . . . . . . . . . . 14,098 (1,346)
-------- --------
$139,357 $133,698
======== ========

Principal elements of cost included in the Company's inventories are
copper, purchased materials, direct labor and manufacturing overhead.
Inventories valued using the LIFO method amounted to $136,980 and $131,481
at December 31, 1993 and 1992, respectively.

NOTE 4 PROPERTY, PLANT AND EQUIPMENT

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

December 31,
----------------------------
1993 1992
---------- ----------

Land . . . . . . . . . . . . . . . . . . . . $ 9,255 $ 8,931
Buildings and improvements . . . . . . . . . 82,664 75,524
Machinery and equipment . . . . . . . . . . 201,871 174,965
Construction in process . . . . . . . . . . 9,667 18,855
-------- --------

303,457 278,275
Less: accumulated depreciation . . . . . . . 30,373 5,970
-------- --------

$273,084 $272,305
======== ========

F-10

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

NOTE 5 ACCRUED LIABILITIES

Accrued liabilities include the following:

December 31,
----------------------------
1993 1992
---------- ----------

Salaries, wages and employee benefits . . . $12,099 $11,659
Amounts due customers . . . . . . . . . . . 4,328 4,557
Other . . . . . . . . . . . . . . . . . . . 26,436 27,381
-------- --------
$42,863 $43,597
======== ========

NOTE 6 LONG-TERM DEBT

Long-term debt consists of the following:

December 31,
----------------------------
1993 1992
---------- ----------

10% Senior notes . . . . . . . . . . . . . . $200,000 $ -
Term loan . . . . . . . . . . . . . . . . . . - 120,500
Revolving loan . . . . . . . . . . . . . . . - 11,000
12 3/8% Senior subordinated debentures . . . - 89,789
-------- --------
200,000 221,289

Less: current portion . . . . . . . . . . . . - 40,000
-------- --------
$200,000 $181,289
======== ========

Bank Financing

In connection with the Acquisition and Merger, the Company entered into a
credit agreement dated September 25, 1992, among BE, Holdings, the lenders
named therein and Chemical Bank, as agent (the "Credit Agreement"). Under
the Credit Agreement, the Company borrowed $130,000 in term loans (the
"Term Credit") of which $94,000 was used to repay all indebtedness

F-11

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

outstanding under the previous credit agreement and the balance was used
to pay a portion of the consideration payable to Holdings' shareholders
and option holders in the Merger and certain fees and expenses in
connection with the Acquisition and Merger and for other general corporate
purposes. In May 1993, the Company applied $111,000 of the proceeds from
the sale of its 10% Senior Notes due 2003 (the "Senior Notes") to repay
the outstanding balance under the Term Credit. See Senior Notes below.
The Company recognized an extraordinary charge of $3,055, net of
applicable tax benefit of $1,953, in the second quarter of 1993
representing the write-off of unamortized debt costs associated with the
outstanding Term Credit.

On May 7, 1993 an amendment and restatement of the Credit Agreement (the
"Restated Credit Agreement") became effective. The Restated Credit
Agreement provides for $175,000 in revolving credit, subject to specified
percentages of eligible assets, reduced by outstanding letters of credit
($13,924 at December 31, 1993) (the "Revolving Credit"). The Revolving
Credit expires in 1998. Revolving Credit loans bear interest at floating
rates at bank prime rate plus 1.25% or a reserve adjusted Eurodollar rate
(LIBOR) plus 2.25%. The effective interest rate can be reduced by 0.25%
to 0.75% if certain specified financial conditions are achieved.
Commitment fees during the revolving loan period are 0.5% of the average
daily unused portion of the available credit. The Company has purchased
interest rate cap protection through 1994 with respect to $100,000 of
debt. Such interest rate protection was purchased at a cost of $685 and
carries a strike rate of 6% (three month LIBOR). At December 31, 1993 and
1992, the Company's incremental borrowing rate, including applicable
margins, approximated 7.3% and 7.8%, respectively, relating to borrowings
under the Restated Credit Agreement and the Credit Agreement.

The Restated Credit Agreement contains various covenants which include,
among other things: (a) the maintenance of certain financial ratios and
compliance with certain financial tests and limitations; (b) limitations
on investments and capital expenditures; (c) limitations on cash dividends
paid; and (d) limitations on leases and the sale of assets. Through
December 31, 1993, the Company fully complied with all of the financial
ratios and covenants contained in the Restated Credit Agreement.

The indebtedness under the Restated Credit Agreement is guaranteed by
Holdings and all of the Company's subsidiaries, and is secured by a pledge
of the capital stock of the Company and its subsidiaries and by a first
lien on substantially all assets.

Senior Notes

On May 7, 1993 the Company issued $200,000 aggregate principal amount of
its Senior Notes which bear interest at 10% and are due in May, 2003. The
net proceeds to the Company from the sale of the Senior Notes, after
underwriting discounts, commissions and other offering expenses, were
$193,450. The Company applied $111,000 of such proceeds to the repayment
of the Term Credit and on June 2, 1993 applied the balance of such

F-12

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

proceeds, together with new borrowings of $7,450 under the Revolving
Credit, to redeem all of its outstanding 12 3/8% Senior Subordinated
Debentures due 2000 (the "Debentures").

The Senior Notes rank pari passu in right of payment with all other
senior indebtedness of the Company. To the extent that any other senior
indebtedness of the Company is secured by liens on the assets of the
Company, the holders of such secured senior indebtedness will have a claim
prior to any claim of the holders of the Senior Notes as to those assets.

At the option of the Company, the Senior Notes may be redeemed,
commencing in May 1998 in whole, or in part, at redemption prices ranging
from 103.75% in 1998 to 100% in 2001, or at 109% for up to $67,000 with
the proceeds from any public equity offering prior to June 30, 1996. Upon
a Change in Control, as defined in the indenture covering the Senior Notes
(the "Indenture"), each holder of Senior Notes will have the right to
require the Company to repurchase all or any part of such holder's Senior
Notes at a repurchase price equal to 101% of the principal amount thereof.
The Indenture contains various covenants which include, among other
things, limitations on debt, on the sale of assets, and on cash dividends
paid. Through December 31, 1993, the Company fully complied with all of
the financial ratios and covenants contained in the Indenture.

Debentures

The Debentures were due in 2000 and bore interest at 12 3/8% per annum
payable semi-annually. However, the Restated Credit Agreement required
the Debentures, which were callable at 106% commencing May 15, 1993, to be
retired no later than June 30, 1993. Because of the mandatory retirement,
the Debentures were valued by the Successor at the expected retirement
cost, discounted at 11.5%. On June 2, 1993, the Company redeemed all of
the outstanding Debentures at 106% of their principal amount, resulting in
a net loss of $312, net of applicable tax benefit of $199, which has been
reported as an extraordinary charge.

During 1992 the Company repurchased outstanding Debentures which had a
carrying value of $13,843. The net loss resulting from this repurchase,
which includes the write-off of a portion of unamortized debt costs,
totalled $122, net of applicable income tax benefit of $78, for
Predecessor, which has been reported as an extraordinary charge. During
1991, the Company repurchased outstanding Debentures which had a carrying
value of $41,960. The net loss resulting from this repurchase, including
unamortized debt costs, was reflected as an extraordinary charge of
$1,471, net of applicable income tax benefit of $941.

F-13

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

Other

The Company capitalized interest costs of $1,599, $116, $220 and $0 for
Successor in 1993, Successor and Predecessor in 1992, and for Predecessor
in 1991, respectively, with respect to qualifying assets.

Total interest paid was $20,961, $7,344, $10,076 and $24,308, for
Successor in 1993, Successor and Predecessor in 1992, and for Predecessor
in 1991, respectively.

There are no maturities of long-term debt within the next five years.

NOTE 7 INCOME TAXES

Effective October 1, 1992, concurrent with the new basis of accounting,
the Successor adopted FAS 109. The Predecessor's financial statements for
all periods through September 30, 1992 reflect the historical accounting
method for income taxes and have not been restated to reflect FAS 109.
Under FAS 109 assets and liabilities acquired, and the resulting charges
or credits reflected in future statements of operations, are stated at the
gross fair value at the date of acquisition, whereas under the previous
historical method, assets and liabilities and the resulting charges or
credits were recorded at amounts net of the related tax differences
between fair value and the tax basis.

Deferred income taxes at December 31, 1993 and December 31, 1992 reflect
the net tax effects of temporary differences between the carrying amounts
of assets and liabilities for financial reporting purposes and the amounts
used for income tax purposes. Significant components of the Successor's
deferred tax liabilities and assets are as follows:

F-14

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

December 31,
-------------------------
1993 1992
-------- --------

Deferred tax liabilities:
Property, plant and equipment . . . . $75,923 $76,458
Inventory . . . . . . . . . . . . . . 27,935 27,768
Other . . . . . . . . . . . . . . . . 4,274 4,629
-------- --------

Total deferred tax liabilities . . . 108,132 108,855
-------- --------
Deferred tax assets:
Accrued liabilities . . . . . . . . . 8,793 8,354
Long-term debt premium . . . . . . . - 1,910
Other . . . . . . . . . . . . . . . . 7,268 5,898
-------- --------

Total deferred tax assets . . . . . 16,061 16,162
-------- --------

Net deferred tax liabilities . . . $92,071 $92,693
======== ========

F-15

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

The components of income tax expense (benefit) are:

SUCCESSOR PREDECESSOR
------------------------- -------------------------
Three Month Nine Month
Year Ended Period Ended Period Ended Year Ended
December 31, December 31, September 30, December 31,
1993 1992 1992 1991
------------ ------------ ------------- ------------

Current:
Federal . . . . . . . . . . $10,978 $ (431) $6,868 $10,745
State . . . . . . . . . . . 2,696 112 1,143 2,332

Deferred:
Federal . . . . . . . . . . 127 (1,297) 1,109 135
State . . . . . . . . . . . (749) (284) 158 29
-------- ------- -------- --------

$13,052 $(1,900) $9,278 $13,241
======== ======= ======== ========

In compliance with the Omnibus Budget Reconciliation Act of 1993, enacted
in August of 1993 retroactive to January 1, 1993, the Company's tax
balances were adjusted in the third quarter of 1993 to reflect the
increase in the federal statutory tax rate from 34% to 35%. The
adjustment had the effect of increasing income tax expense by $2,250 for
the year ended December 31, 1993.

Total income taxes paid were $1,131, $8,608, $6,604 and $6,411 for
Successor in 1993, Successor and Predecessor in 1992, and for Predecessor
in 1991, respectively.

The Predecessor's deferred tax provision results from timing differences
in the recognition of revenue and expense for tax and financial reporting
purposes. Sources of these differences were primarily related to
depreciation and accruals deductible in different periods for tax
purposes.

Principal differences between the effective income tax rate and the
statutory federal income tax rate are:

F-16

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

SUCCESSOR PREDECESSOR
-------------------------- --------------------------
Three Month Nine Month
Year Ended Period Ended Period Ended Year Ended
December 31, December 31, September 30, December 31,
1993 1992 1992 1991
------------- ------------ ------------- ------------

Statutory federal income tax rate . . . 35.0% (34.0)% 34.0% 34.0%
State and local taxes, net of
federal benefit . . . . . . . . . . . 5.6 (1.6) 5.8 5.5
Permanent differences from applying
purchase accounting . . . . . . . . . - - 12.2 7.7
Excess of cost over net assets
acquired amortization . . . . . . . . 6.3 5.1 - -
Federal rate increase . . . . . . . . . 10.0 - - -
Tax sharing agreement limitation . . . - - 8.2 -
Other, net . . . . . . . . . . . . . . 1.3 3.2 2.9 .5
------ ------ ------ ------

Effective income tax rate . . . . . . . 58.2% (27.3)% 63.1% 47.7%
====== ====== ====== ======

The Company elected not to step up its tax bases in the assets acquired.
Accordingly, the income tax bases in the assets acquired have not been
changed from pre-1988 Acquisition values. Depreciation and amortization
of the higher allocated financial statement bases are not deductible for
income tax purposes, thus increasing the effective income tax rate
reflected in the Predecessor's consolidated financial statements. Under
FAS 109, the Successor has recorded deferred income taxes for such
differences.

F-17

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

NOTE 8 RETIREMENT BENEFITS

The Company participates in two defined benefit retirement plans for
substantially all salaried and hourly employees. In 1992, the Company
adopted a supplemental executive retirement plan and related agreements,
which provides benefits based on the same formula as in effect under the
salaried employees' plan, but which only takes into account compensation
in excess of amounts that can be recognized under the salaried employees'
plan. Salaried plan benefits are generally based on years of service and
the employee's compensation during the last several years of employment.
Hourly plan benefits are based on hours worked and years of service with a
fixed dollar benefit level. The Company's funding policy is based on an
actuarially determined cost method allowable under Internal Revenue
Service regulations, the projected unit credit method. Pension plan
assets consist principally of fixed income and equity securities and cash
and cash equivalents.

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

SUCCESSOR PREDECESSOR
------------------------- ---------------------------
Three Month Nine Month
Year Ended Period Ended Period Ended Year Ended
December 31, December 31, September 30, December 31,
1993 1992 1992 1991
------------ ------------ ------------- -------------

Service cost benefits earned
during the period . . . . . . . . . . $2,611 $628 $2,282 $2,624
Interest costs on projected benefit
obligation . . . . . . . . . . . . . . 3,521 799 2,479 2,562
Actual return on plan assets . . . . . (6,078) (841) (1,544) (6,234)
Net amortization and deferral . . . . . 2,573 5 (365) 3,787
-------- -------- -------- --------

Net periodic pension cost . . . . . . . $2,627 $591 $2,852 $2,739
======== ======== ======== ========

The following table summarizes the funded status of these pension plans
and the related amounts that are recognized in the consolidated balance
sheets:

F-18

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

December 31,
----------------------------------
1993 1992
---------------- -----------------

Actuarial present value of benefit obligation:
Vested . . . . . . . . . . . . . . . . . . . . . $32,313 $21,220
Nonvested . . . . . . . . . . . . . . . . . . . 3,110 2,642
-------- --------

Accumulated benefit obligation . . . . . . . . . 35,423 23,862
Effect of projected future salary increases . . 15,409 18,043
-------- --------

Projected benefit obligation . . . . . . . . . . 50,832 41,905
Plan assets at fair value . . . . . . . . . . . . . . 45,137 39,211
-------- --------

Deficiency of projected benefit obligation
over fair value of plan assets . . . . . . . . . . . (5,695) (2,694)
Unrecognized net (gain) loss . . . . . . . . . . . . 614 (206)
-------- --------

Pension liability recognized in balance sheets . . . $(5,081) $(2,900)
======== ========

Certain actuarial assumptions were revised in 1993 resulting in an
increase of $3,448 in the projected benefit obligation. Actuarial
assumptions were revised at October 1, 1992 concurrent with the new basis
of accounting. The revised assumptions resulted in a $7,328 reduction in
the projected benefit obligation as of October 1, 1992.

F-19

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

Following is a summary of significant actuarial assumptions used:

SUCCESSOR PREDECESSOR
------------------------- --------------------------
Three Month Nine Month
Year Ended Period Ended Period Ended Year Ended
December 31, December 31, September 30, December 31,
1993 1992 1992 1991
------------ ------------ ------------- ------------

Discount rates . . . . . . . . 7.0% 8.0% 7.1% 7.1%
Rates of increase in
compensation levels . . . . . 5.0% 6.0% 7.0% 7.0%
Expected long-term rate of
return on assets . . . . . . . 9.0% 9.0% 7.1% 7.9%

The Company contributed $194, $48, $136 and $165 to multi-employer
pension plans for Successor in 1993, Successor and Predecessor in 1992 and
for Predecessor in 1991, respectively. The Company has no further
obligation, other than recurring contributions, to these plans as long as
the applicable operations continue.

The Company has established a defined contribution savings plan which
allows both 401(a) and 401(k) contributions covering substantially all of
the salaried employees of the Company. The purpose of this savings plan
is generally to provide additional financial security during retirement by
providing salaried employees with an incentive to make regular savings.
The Company's contributions to the plan, which approximates expense, are
based on employee contributions and totalled $1,030, $276, $733 and $946
for Successor in 1993, Successor and Predecessor in 1992, and Predecessor
in 1991, respectively.

F-20

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

NOTE 9 STOCKHOLDER'S EQUITY

The following is an analysis of the changes to the Company's
stockholder's equity:

Common
Stock Plus
Additional Total
Paid In Retained Stockholder's
Capital Earnings Equity
---------- ---------- --------------

PREDECESSOR
-----------
Balance at January 1, 1991 . . . . . . . . . . . . . . $58,000 $54,325 $112,325

Net income . . . . . . . . . . . . . . . . . . . . . . - 13,029 13,029
Cash dividends paid to Holdings . . . . . . . . . . . . - (5,000) (5,000)
-------- -------- --------

Balance at December 31, 1991 . . . . . . . . . . . . . 58,000 62,354 120,354

Net income . . . . . . . . . . . . . . . . . . . . . . - 5,314 5,314
Merger related expenses payable by Holdings . . . . . . 14,089 - 14,089
Cash dividends paid to Holdings . . . . . . . . . . . . - (7,500) (7,500)
-------- -------- --------

Balance at September 30, 1992 . . . . . . . . . . . . . $72,089 $60,168 $132,257
======== ======== ========
SUCCESSOR
---------
Initial capitalization at October 1, 1992:
Initial capitalization . . . . . . . . . . . . . . $318,043 $ - $318,043
Reduction of equity to reflect proportionate
historical cost basis for management's
continuing common stock interest . . . . . . . . (15,259) - (15,259)
-------- -------- --------
302,784 - 302,784

Net loss . . . . . . . . . . . . . . . . . . . . . . . - (5,062) (5,062)
-------- -------- --------
Balance at December 31, 1992 . . . . . . . . . . . . . 302,784 (5,062) 297,722

Net income . . . . . . . . . . . . . . . . . . . . . . - 6,010 6,010
-------- -------- --------

Balance at December 31, 1993 . . . . . . . . . . . . . $302,784 $ 948 $303,732
======== ======== ========

F-21

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars, Except Per Copper Pound Data
-----------------------------------------------------

NOTE 10 RELATED PARTY TRANSACTIONS

Advisory services fees of $1,000 and $229 were paid to affiliates of BHLP
and BCP for 1993 and the three month period ended December 31, 1992,
respectively, and to MSLEF II in the amount of $210 and $280 during the
nine month period ended September 30, 1992, and for 1991, respectively.
It is expected that financial advisory fees to an affiliate of BHLP will
continue to be paid for such services in the future. Also, in connection
with the Acquisition and Merger, an affiliate of BCP received financial
advisory fees of $1,900 associated with the financing plus certain out of
pocket expenses. DLJ and Goldman Sachs acted as underwriters in the
offerings of the Senior Notes, and in such capacity received aggregate
underwriting discounts and commissions of $5,300. In addition, during the
nine month period ended September 30, 1992, and for the year 1991,
management fees to Holdings of $1,875 and $3,500 respectively, were
incurred.

In May 1989, Holdings issued $342,000 aggregate principal amount
($135,117 aggregate proceeds amount) of Holdings Debentures, the proceeds
of which were used to pay a dividend to Holdings shareholders, cash
bonuses to certain members of its management, and related expenses.
During 1991, the Company paid cash dividends to Holdings of $5,000, which
amounts were used to repurchase Holdings Debentures. Additionally, during
1992, the Company paid cash dividends of $7,500 which were used to finance
a portion of the Acquisition. As of December 31, 1993, Holdings had a
liability of $228,942 related to the Holdings Debentures. The Holdings
Debentures are unsecured debt of Holdings and are effectively subordinated
to all outstanding indebtedness of the Company, including the Senior
Notes, and will be effectively subordinated to other indebtedness incurred
by direct and indirect subsidiaries of Holdings if issued. No periodic
cash payment of interest is required to be made by Holdings prior to
November 15, 1995 on the Holdings Debentures and interest is payable in
cash at 16.0% thereafter.

Holdings is a holding company with no operations and has virtually no
assets other than its ownership of the outstanding common stock of the
Company. All of such stock is pledged, however, to the lenders under the
Restated Credit Agreement. Accordingly, Holdings' ability to meet its
obligations when due under the terms of its indebtedness will be dependent
on the Company's ability to pay dividends, to loan, or otherwise advance
or transfer funds to Holdings in amounts sufficient to service Holdings'
debt obligations.

NOTE 11 CONTINGENT LIABILITIES AND COMMITMENTS

There are various claims and pending legal proceedings against the
Company including environmental matters and other matters arising out of
the ordinary conduct of its business. Pursuant to the 1988 Acquisition,
UTC agreed to indemnify the Company against all losses (as defined)
resulting from or in connection with damage or pollution to the
environment and arising from events, operations, or activities of the

F-22

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

Company prior to February 29, 1988 or from conditions or circumstances
existing at February 29, 1988. Except for certain matters relating to
permit compliance, the Company is fully indemnified with respect to
conditions, events or circumstances known to UTC prior to February 29,
1988. Further, the Company is indemnified, subject to a $4,000 "basket"
for losses related to any environmental events, conditions or
circumstances identified in the five year period ended February 1993, to
the extent such losses are not caused by activities of the Company after
February 29, 1988. After consultation with counsel, in the opinion of
management, the ultimate cost to the Company, exceeding amounts provided,
will not materially affect the consolidated financial position or results
of operations.

At December 31, 1993, the Company had purchase commitments of 444.5
million pounds of copper. This is not expected to be either a quantity in
excess of needs or at prices in excess of amounts that can be recovered
upon sale of the copper products. The commitments are to be priced based
on the COMEX price in the contractual month of shipment except for 60.1
million pounds priced at fixed amounts, of which 36.6 million pounds are
covered by customer sales agreements at copper prices at least equal to
the Company's commitment. The remaining 23.5 million pounds that are not
covered by customer sales agreements are priced at an average of $.81 per
pound.

At December 31, 1993, the Company had committed $8,644 to outside vendors
for certain capital projects.

The Company occupies space and uses certain equipment under lease
arrangements. Rent expense was $6,224, $1,949, $4,138 and $5,684 under
such arrangements for the year ended December 31, 1993, the three month
period ended December 31, 1992, the nine month period ended September 30,
1992 and the year 1991, respectively. Rental commitments at December 31,
1993 under long-term noncancellable operating leases were as follows:

Real Estate Equipment Total
----------- --------- -----
1994 $ 2,230 $2,284 $ 4,514
1995 1,883 2,067 3,950
1996 1,391 1,185 2,576
1997 1,132 701 1,833
1998 1,015 652 1,667
After 1998 13,988 1,421 15,409
------- ------ -------
$21,639 $8,310 $29,949
======= ====== =======

F-23

ESSEX GROUP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued

In Thousands of Dollars
-----------------------

NOTE 12 QUARTERLY FINANCIAL DATA (UNAUDITED)

SUCCESSOR
--------------------------------------------------
1993 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
----------------------------------- ------------ ------------ ------------ ------------

Net sales . . . . . . . . . . . . . $204,309 $230,465 $220,249 $213,823
Gross margin . . . . . . . . . . . 29,543 30,067 27,547 35,814
Income (loss) before
extraordinary charge . . . . . . . 1,536 2,583 (988) 6,246

Net income (loss) (a) . . . . . . . $1,536 $(784) $(988) $6,246

PREDECESSOR SUCCESSOR
--------------------------------------- ------------
1992 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
----------------------------------- ------------ ------------ ------------ ------------

Net sales . . . . . . . . . . . . . $230,668 $237,313 $232,016 $209,354
Gross margin . . . . . . . . . . . 36,282 36,075 33,518 23,328
Income (loss) before
extraordinary charge (b) . . . . 6,899 5,477 (6,940) (5,062)

Net income (loss) (a)(b) . . . . . $6,777 $5,477 $(6,940) $(5,062)

(a) In the second quarter of 1993, the Company recognized an
extraordinary charge of $3,055 net of applicable income tax benefit
of $1,953, representing the write-off of unamortized debt costs
associated with retirement of the outstanding Term Credit. During
1993 and the nine month period ended September 30, 1992 the Successor
and Predecessor repurchased outstanding Debentures resulting in
extraordinary charges of $312 and $122 net of applicable income tax
benefits of $199 and $78, respectively (See Note 6).

(b) In connection with the Acquisition and Merger, the Company incurred
certain merger related expenses of $18,139 consisting primarily of
bonus and option payments to certain employees and certain merger
fees and expenses, which were charged to the Predecessor's operations
in the third quarter 1992.

F-24

SCHEDULE V
ESSEX GROUP, INC.

PROPERTY, PLANT AND EQUIPMENT

In Thousands of Dollars
-----------------------

SUCCESSOR
-------------------------------------------------------------
Balance at Balance at
December 31, December 31,
1992 Additions Retirements 1993
-------------------------------------------------------------

Land $ 8,931 $ 331 $ (7) $ 9,255
Buildings and
improvements 75,524 7,167 (27) 82,664
Machinery and
equipment 174,965 27,857 (951) 201,871
Construction in
process 18,855 (9,188) - 9,667
-------- -------- -------- --------
$278,275 $26,167 $ (985) $303,457
======== ======== ======== ========

-------------------------------------------------------------
Balance at Balance at
October 1, December 31,
1992 (a) Additions Retirements 1992
-------------------------------------------------------------

Land $ 8,931 $ - $ - $ 8,931
Buildings and
improvement 74,506 1,018 - 75,524
Machinery and
equipment 168,960 6,006 (1) 174,965
Construction in
process 11,174 7,681 - 18,855
-------- -------- -------- --------
$263,571 $14,705 $ (1) $278,275
======== ======== ======== ========

S-1

SCHEDULE V
ESSEX GROUP, INC.

PROPERTY, PLANT AND EQUIPMENT

In Thousands of Dollars
-----------------------
PREDECESSOR
-------------------------------------------------------------
Balance at Balance at
December 31, September 30,
1991 Additions Retirements 1992
-------------------------------------------------------------

Land $ 7,784 $ 7 $ (96) $ 7,695
Buildings and
improvements 63,054 1,323 (1,023) 63,354
Machinery and
equipment 138,514 8,817 (1,762) 145,569
Construction in
process 4,846 6,328 - 11,174
-------- ------- ------- --------
$214,198 $16,475 $(2,881) $227,792
======== ======= ======= ========

-------------------------------------------------------------
Balance at Balance at
December 31, December 31,
1990 Additions Retirements 1991
-------------------------------------------------------------

Land $ 7,784 $ - $ - $ 7,784
Buildings and
improvements 60,994 2,174 (114) 63,054
Machinery and
equipment 130,126 11,970 (3,582) 138,514
Construction in
process 5,748 (902) - 4,846
-------- ------- -------- --------
$204,652 $13,242 $ (3,696) $214,198
======== ======= ======== ========

(a) Balances reflect the allocation of the purchase price as described in
Note 1 of Notes to Consolidated Financial Statements.

S-2

SCHEDULE VI

ESSEX GROUP, INC.

ACCUMULATED DEPRECIATION OF PROPERTY, PLANT AND EQUIPMENT

In Thousands of Dollars
-----------------------

Buildings and
improvements $ 973 $ 3,963 $ (70) $ 4,866
Machinery and
equipment 4,997 20,637 (127) 25,507
------- ------- ------ -------
$5,970 $24,600 $ (197) $30,373
======= ======= ====== =======

-------------------------------------------------------------
Balance at Balance at
October 1, December 31,
1992 Additions Retirements 1992
------------------------------------------------------------

Buildings and
improvements - $ 973 - $ 973
Machinery and
equipment - 4,997 - 4,997
------ ------ ------ ------
- $5,970 - $5,970
====== ====== ====== ======

S-3

SCHEDULE VI

ESSEX GROUP, INC.

ACCUMULATED DEPRECIATION OF PROPERTY, PLANT AND EQUIPMENT

In Thousands of Dollars
-----------------------
PREDECESSOR
--------------------------------------------------------------
Balance at Balance at
December 31, September 30,
1991 Additions Retirements 1992
--------------------------------------------------------------

Buildings and
improvements $9,831 $ 1,925 $ (40) $11,716
Machinery and
equipment 42,127 9,561 (1,051) 50,637
------- ------- ------- -------
$51,958 $11,486 $(1,091) $62,353
======= ======= ======= =======

--------------------------------------------------------------
Balance at Balance at
December 31, December 31,
1990 Additions Retirements 1991
--------------------------------------------------------------

Buildings and
improvements $7,256 $ 2,561 $ 14 $ 9,831
Machinery and
equipment 31,659 12,594 (2,126) 42,127
------- ------- ------- -------
$38,915 $15,155 $(2,112) $51,958
======= ======= ======= =======

The estimated useful lives currently used in the computation of
depreciation for the consolidated financial statements are as follows:

Buildings and improvements 10 to 40 years

Machinery and equipment 3 to 15 years

S-4

SCHEDULE VIII

ESSEX GROUP, INC.

VALUATION AND QUALIFYING ACCOUNTS

SUCCESSOR PREDECESSOR
----------------------------- -------------------------------
Three Month Nine Month
Year Ended Period Ended Period Ended Year Ended
December 31, December 31, September 30, December 31,
In Thousands of Dollars 1993 1992 1992 1991
----------------------- --------------------------------------------------------------

Allowance for doubtful
accounts:

Balance at
beginning of period $2,455 $2,462 $4,912 $4,469
Provision 850 75 (1,848) 1,210
Write-offs (765) (177) (763) (970)
Recoveries 271 95 161 203
-------- -------- -------- --------
Balance at end of
period $2,811 $2,455 $2,462 $4,912
======== ======== ======== ========

S-5

SCHEDULE X

ESSEX GROUP, INC.

SUPPLEMENTARY INCOME STATEMENT INFORMATION

SUCCESSOR PREDECESSOR
------------------------------ -------------------------------
Three Month Nine Month
Year Ended Period Ended Period Ended Year Ended
December 31, December 31, September 30, December 31,
In Thousands of Dollars 1993 1992 1992 1991
----------------------- --------------------------------------------------------------

The following costs and
expenses were charged to
operations:

Maintenance and repairs $19,530 $4,693 $13,531 $17,330
Depreciation and amortization
of intangible assets and
similar deferrals $10,565 $6,245 $6,886 $8,931

Royalties, advertising costs and taxes, other than payroll and income
taxes, were either less than one percent of total sales and revenues or
were disclosed in the consolidated financial statements.

S-6

EXHIBIT INDEX

Location of Exhibit
Exhibit in Sequential
Number Description of Document Numbering System
--------------------------------------------------------------------------

EXHIBIT INDEX

Location of Exhibit
Exhibit in Sequential
Number Description of Document Numbering System
--------------------------------------------------------------------------

10.02 Credit Agreement dated as of September 25, 1992, among B E
Acquisition Corporation, BCP/Essex Holdings Inc., the registrant,
the lenders named therein and Chemical Bank, as agent,
incorporated by reference to Exhibit 4.6 to BCP/Essex Holdings
Inc.'s Current Report on Form 8-K, filed with the Securities and
Exchange Commission on October 26, 1992 (Commission File No. 1-
10211).
10.03 Engagement Letter dated July 22, 1992 among Bessemer Capital
Partners, L.P., B E Acquisition Corporation, and Donaldson, Lufkin
& Jenrette, Inc., incorporated by reference to Exhibit 10.10 to
registrant's Annual Report on Form 10-K for the year ended
December 31, 1992 (Commission File No. 1-7418).
10.04 Amendment dated October 9, 1992 among Bessemer Capital Partners,
L.P., B E Acquisition Corporation, Donaldson, Lufkin & Jenrette,
Inc. and Goldman, Sachs and Co., to Engagement Letter dated July
22, 1992 among Bessemer Capital Partners, L.P., B E Acquisition
Corporation and Donaldson, Lufkin & Jenrette, Inc., incorporated
by reference to Exhibit 10.11 to registrant's Annual Report on
Form 10-K for the year ended December 31, 1992 (Commission File
No. 1-7418).Agreement and Plan of Merger, dated as of July 24,
1992 (the "Merger Agreement"), between B E Acquisition Corporation
and BCP/Essex Holdings Inc. (then known as MS/Essex Holdings
Inc.), incorporated by reference to Exhibit 2.1 to BCP/Essex
Holdings Inc.'s (then known as MS/Essex Holdings Inc.) Current
Report on Form 8-K, filed with the Securities and Exchange
Commission on August 10, 1992 (Commission File No. 1-10211).
12.01 Computation of Ratio of Earnings to Fixed Charges.
22.01 Subsidiaries of the registrant.
99.01 Registration Rights Agreement dated as of October 9, 1992, among
B E Acquisition Corporation, certain affiliates of Donaldson,
Lufkin & Jenrette, Inc., certain affiliates of Goldman, Sachs &
Co., and Chemical Equity Associates, A California Limited
Partnership, incorporated by reference to Exhibit 28.2 to
BCP/Essex Holdings Inc.'s Current Report on Form 8-K, filed with
the Securities and Exchange Commission on October 26, 1992
(Commission File No. 1-10211).
99.02 Amended and Restated Stock Option Plan of BCP/Essex Holdings Inc.,
incorporated by reference to Exhibit 4.7 to BCP/Essex Holdings
Inc.'s Current Report on Form 8-K, filed with the Securities and
Exchange Commission on October 26, 1992 (Commission File No. 1-
10211).

EXHIBIT 12.01

ESSEX GROUP, INC.

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

SUCCESSOR
----------------------------------
Three Month
Year Ended Period Ended
In Thousands of Dollars, December 31, December 31,
Except Ratio Data 1993 1992
-----------------------------------------------------------------------------------------

Income (loss) before income
taxes and extraordinary
charge $22,429 $ (6,962)

Add:
Interest expense 25,241 8,086

Portion of rents representative of
interest factor 2,073 650

Current period
amortization of interest
capitalized in prior periods 8 -
-------- --------
Income as adjusted $49,751 $ 1,774
======== ========
Fixed charges:
Interest incurred:
Amount expensed $25,241 $ 8,086
Amount capitalized 1,599 116
Portion of rents
representative of interest
factor 2,073 650
-------- --------

Total fixed charges $28,913 $ 8,852
======== ========
Ratio of earnings to fixed
charges (a) 1.7 -
=== ===

(a) Earnings of the Successor were insufficient to cover fixed charges by
the amount of $7,078 for the three month period ended December 31,
1992.

EXHIBIT 12.01

ESSEX GROUP, INC.

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES - Continued

PREDECESSOR
------------------------------------------------
Nine Month
Period Ended
September 30, Year Ended December 31,
In Thousands of Dollars, Except 1992 1991 1990 1989
Ratio Data
------------------------------------------------------------------------------------

Income (loss) before
taxes and extraordinary
charge $14,714 $27,741 $43,208 $42,411

Add:
Interest Expense 14,505 24,969 31,893 39,018

Portion of rents
representative of
interest factor 1,379 1,876 1,856 1,830

Current period
amortization of
interest capitalized
in prior periods 48 63 56 38
------- ------- ------- -------
Income as adjusted $30,646 $54,649 $77,013 $83,297
======= ======= ======= =======
Fixed charges:
Interest incurred:
Amount expensed $14,505 $24,969 $31,893 $39,018
Amount capitalized 220 - 107 232
Portion of rents
representative of
interest factor 1,379 1,876 1,856 1,830
------- ------- ------- -------
Total fixed charges $16,104 $26,845 $33,856 $41,080
======= ======= ======= =======
Ratio of earnings to
fixed charges (a) 1.9 2.0 2.3 2.0
=== === === ===

EXHIBIT 22.01

ESSEX GROUP, INC. (MICHIGAN)

SUBSIDIARIES OF THE REGISTRANT

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

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

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

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

ExCel Wire and Cable Co. . . . . . . . . . . . . . . Illinois

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

Bristol Wire Company . . . . . . . . . . . . . . . . Delaware

Femco Magnet Wire Corporation . . . . . . . . . . . . Indiana

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

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

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

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

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