<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
SCHEDULE 14D-1/A
Tender Offer Statement Pursuant to Section 14(d)(1)
of the Securities Exchange Act of 1934
(Amendment No. 1)
INTERNATIONAL MUREX TECHNOLOGIES CORPORATION
(Name of Subject Company)
AAC ACQUISITION LTD.
an indirect wholly owned subsidiary of
ABBOTT LABORATORIES
(Bidder)
COMMON SHARES
(Title of Class of Securities)
46005H100
(CUSIP Number of Class of Securities)
Jose M. de Lasa
Senior Vice President, Secretary
and General Counsel
Abbott Laboratories
100 Abbott Park Road
Abbott Park, Illinois 60064-3500
(847) 937-6100
with a copy to:
Scott J. Davis
James T. Lidbury
Mayer, Brown & Platt
190 South LaSalle Street
Chicago, Illinois 60603
(312) 782-0600
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications on Behalf of Bidder)
CALCULATION OF FILING FEE
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Transaction Valuation Amount of Filing Fee
------------------------------------------------------------------------
<S> <C>
$240,519,396 $48,105
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------------------------------------------------------------------------
</TABLE>
* For purposes of calculating the filing fee only. This amount assumes the
purchase of 18,501,492 common shares (the "Shares") of the subject
company at $13.00 in cash per Share.
/X/ Check box if any part of the fee is offset as provided by Rule 0-11(a)(2)
and identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by registration statement number, or the Form
or Schedule and the date of its filing.
Amount Previously Paid: $48,105
Form or Registration Number: Schedule 14D-1
Filing Party: Abbott Laboratories AAC Acquisition Ltd.
Date Filed: March 20, 1998
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Page 1 of 7 Pages
Exhibit Index is located on Page 7
<PAGE>
CUSIP No.: 46005H100 14D-1 Page 2 of 7 Pages
1. Name of Reporting Person: AAC Acquisition Ltd.
S.S. or I.R.S. Identification Nos. of Above Person: None.
Name of Reporting Person: Abbott Laboratories
S.S. or I.R.S. Identification Nos. of Above Person: 36-0698440
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2. Check the Appropriate Box if a Member of a Group: (a) / /
(b) / /
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3. SEC Use Only:
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4. Sources of Funds: WC
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5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(e)
or 2(f): / /
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6. Citizenship or Place of Organization: British Columbia (AAC Acquisition
Ltd.); Illinois (Abbott Laboratories)
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7. Aggregate Amount Beneficially Owned by Each Reporting Person: 0 Shares
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8. Check if the Aggregate in Row (7) Excludes Certain Shares: / /
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9. Percent of Class Represented by Amount in Row (7): 0.0%
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10. Type of Reporting Person: CO (AAC Acquisition Ltd.)
CO (Abbott Laboratories)
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2
<PAGE>
EXPLANATORY NOTE
----------------
This Amendment No. 1 to the Schedule 14D-1 filed March 20, 1998 (the
"Original Schedule 14D-1") is being made solely for the purpose of correcting
an EDGAR transmission error. This error resulted in pages 10 through 13,
inclusive, of the Offer to Purchase dated March 20, 1998 filed as Exhibit
(a)(1) to the Original Schedule 14D-1 being omitted from the electronic EDGAR
filing made with the Securities and Exchange Commission on March 20, 1998.
Accordingly, Exhibit (a)(1) is being refiled herewith in its entirety. No
changes to the Offer to Purchase mailed to shareholders and no other
substantive changes to the Original Schedule 14D-1 are being effected hereby.
ITEM 1. SECURITY AND SUBJECT COMPANY.
(a) The name of the subject company is International Murex Technologies
Corporation, a company organized under the laws of British Columbia (the
"Company"), which has its principal executive offices at 2255 B. Queen
Street, East, Suite 828, Toronto, Ontario, Canada M4E 1G3. Capitalized terms
used in this Amendment No. 1 to the Original Schedule 14D-1 and not defined
herein shall have the meanings set forth in the Offer to Purchase dated March
20, 1998 (the "Offer to Purchase") attached hereto as Exhibit (a)(1).
(b) The information set forth in the "Introduction" of the Offer to
Purchase is incorporated herein by reference.
(c) The information set forth in "The Tender Offer - 6. Price Range of
the Shares" of the Offer to Purchase is incorporated herein by reference.
ITEM 2. IDENTITY AND BACKGROUND.
(a)-(d) and (g) The information set forth in "Introduction" and "The
Tender Offer - 8. Certain Information Concerning Purchaser and Parent" of
the Offer to Purchase is incorporated herein by reference.
(e) and (f) During the last five years, neither Abbott Laboratories, an
Illinois corporation ("Parent"), nor AAC Acquisition Ltd., a British Columbia
company ("Purchaser") and an indirect wholly owned subsidiary of Parent, nor,
to the best of their knowledge, any of the individuals listed in "The Tender
Offer - 8. Certain Information Concerning Purchaser and Parent" or in
Schedule I of the Offer to Purchase has (i) been convicted in a criminal
proceeding or (ii) been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and, as a result of such
proceeding, was or is subject to a judgment, decree or final order enjoining
future violations of, or prohibiting activities subject to, federal or state
securities laws or finding any violation of such laws.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY.
(a)-(b) The information set forth in "The Tender Offer - 8. Certain
Information Concerning Purchaser and Parent" and "The Tender Offer - 9.
Background of the Offer" of the Offer to Purchase is incorporated herein by
reference.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a) The information set forth in "The Tender Offer - 11. Source and Amount
of Funds" of the Offer to Purchase is incorporated herein by reference.
(b)-(c) None.
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER.
(a)-(g) The information set forth in "The Tender Offer - 10. Purpose of
the Offer; the Acquisition Agreement" and "The Tender Offer - 12. Certain
Effects of the Offer" of the Offer to Purchase is incorporated herein by
reference.
ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.
(a)-(b) None.
3
<PAGE>
ITEM 7. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO THE SUBJECT COMPANY'S SECURITIES.
The information set forth in "The Tender Offer - 8. Certain Information
Concerning Purchaser and Parent" and "The Tender Offer - 10. Purpose of the
Offer; the Acquisition Agreement" of the Offer to Purchase is incorporated
herein by reference.
ITEM 8. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.
The information set forth in "The Tender Offer - 16. Fees and Expenses" of
the Offer to Purchase is incorporated herein by reference.
ITEM 9. FINANCIAL STATEMENTS OF CERTAIN BIDDERS.
The information set forth in "The Tender Offer - 8. Certain Information
Concerning Purchaser and Parent" and "The Tender Offer - 12. Certain Effects
of the Offer" of the Offer to Purchase is incorporated herein
by reference.
This incorporation by reference herein of the above referenced financial
information does not constitute an admission that such information is material
to a decision by a shareholder of the Company whether to sell, tender or hold
Shares being sought in this tender offer.
ITEM 10. ADDITIONAL INFORMATION.
(a) None.
(b)-(d) The information set forth in "The Tender Offer - 15. Certain Legal
Matters; Regulatory Approvals" of the Offer to Purchase is incorporated herein
by reference.
(e) None.
(f) Reference is hereby made to the Offer to Purchase attached hereto
as Exhibit (a)(1) and the related Letter of Transmittal, attached to the
Original Schedule 14D-1 as Exhibit (a)(2), each of which is incorporated
herein in its entirety by reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
(a)(1) Offer to Purchase dated March 20, 1998.
4
<PAGE>
SIGNATURES
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Dated: April 1, 1998. AAC Acquisition Ltd.
By: /s/ Thomas D. Brown
---------------------------
Name: Thomas D. Brown
Title: Vice President
ABBOTT LABORATORIES
By: /s/ Miles D. White
---------------------------
Name: Miles D. White
Title: Executive Vice President
5
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EXHIBIT INDEX
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Sequentially
Numbered
Exhibit Description Page
- ------- ----------- -----------
<S> <C> <C>
(a)(1) Offer to Purchase dated March 20, 1998. . . . . . . . . . . . . . . .
</TABLE>
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING COMMON SHARES
OF
INTERNATIONAL MUREX TECHNOLOGIES CORPORATION
AT
U.S.$13.00 NET PER SHARE
BY
AAC ACQUISITION LTD.
AN INDIRECT WHOLLY OWNED SUBSIDIARY OF
ABBOTT LABORATORIES
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON THURSDAY, APRIL 16, 1998 UNLESS THE OFFER IS EXTENDED.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING VALIDLY
TENDERED AND NOT PROPERLY WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER A
NUMBER OF COMMON SHARES (THE "SHARES") OF INTERNATIONAL MUREX TECHNOLOGIES
CORPORATION (THE "COMPANY") WHICH CONSTITUTES AT LEAST 75% OF THE COMPANY'S
OUTSTANDING VOTING POWER (ASSUMING THE EXERCISE OF ALL OUTSTANDING OPTIONS TO
PURCHASE SHARES WHICH OPTIONS ARE NOT SUBJECT TO BINDING AGREEMENTS TO CANCEL)
(THE "MINIMUM CONDITION") AND (2) THE EXPIRATION OR TERMINATION OF ANY
APPLICABLE WAITING PERIOD UNDER THE HART-SCOTT-RODINO ANTITRUST IMPROVEMENTS ACT
OF 1976, AS AMENDED (THE "HSR ACT"), THE CANADIAN COMPETITION ACT, THE
INVESTMENT CANADA ACT, ANY APPLICABLE REQUIREMENTS OF ANY LAWS OR REGULATIONS
RELATING TO THE REGULATION OF MONOPOLIES OR COMPETITION IN GERMANY OR ANY
APPLICABLE REQUIREMENTS OF THE UNITED KINGDOM FAIR TRADING ACT. THE OFFER IS
ALSO SUBJECT TO OTHER TERMS AND CONDITIONS CONTAINED IN THIS OFFER TO PURCHASE.
SEE INTRODUCTION AND SECTIONS 1 AND 13 HEREOF.
THE OFFER IS BEING MADE IN CONNECTION WITH THE ACQUISITION AGREEMENT DATED
AS OF MARCH 13, 1998 AMONG THE COMPANY, ABBOTT LABORATORIES ("PARENT") AND AAC
ACQUISITION LTD. ("PURCHASER"), PURSUANT TO WHICH, FOLLOWING THE CONSUMMATION OF
THE OFFER, THE ACQUISITION OF THE COMPANY BY PARENT AND PURCHASER WILL BE
COMPLETED THROUGH EITHER A STATUTORY RIGHT OF ACQUISITION (THE "COMPULSORY
ACQUISITION") OR AN AMALGAMATION OR OTHER BUSINESS COMBINATION (THE
"AMALGAMATION"). THE COMPANY'S BOARD OF DIRECTORS UNANIMOUSLY HAS APPROVED THE
OFFER AND RECOMMENDS THAT SHAREHOLDERS OF THE COMPANY ACCEPT THE OFFER AND
TENDER THEIR SHARES. THE OFFER IS BEING EFFECTED TO FACILITATE EITHER THE
COMPULSORY ACQUISITION OR THE AMALGAMATION. SEE "RECOMMENDATION OF THE COMPANY'S
BOARD OF DIRECTORS."
------------------
IMPORTANT
Any shareholder desiring to tender all or any portion of such shareholder's
Shares, should either (1) complete and sign the Letter of Transmittal (or a
facsimile thereof) in accordance with the instructions in the Letter of
Transmittal and deliver it and any other required documents to the Depositary
and either deliver the certificate(s) representing such Shares to the Depositary
along with the Letter of Transmittal or tender such Shares pursuant to the
procedure for book-entry transfer set forth in Section 3 hereof or (2) request
such shareholder's broker, dealer, commercial bank, trust company or other
nominee to effect the transaction for such shareholder. Any shareholder whose
Shares are registered in the name of a broker, dealer, commercial bank, trust
company or other nominee must contact such broker, dealer, commercial bank,
trust company or other nominee if such shareholder desires to tender such
Shares.
A shareholder who desires to tender Shares and whose certificates
representing such Shares are not immediately available, or who cannot comply
with the procedure for book-entry transfer on a timely basis, may tender such
Shares by following the procedures for guaranteed delivery set forth in Section
3.
Questions and requests for assistance or additional copies of this Offer to
Purchase, the Letter of Transmittal and the Notice of Guaranteed Delivery may be
directed in the United States to Goldman, Sachs & Co. and in Canada to Goldman
Sachs Canada, or to the Information Agent, at their respective addresses and
telephone numbers set forth on the back cover of this Offer to Purchase.
Additional copies of this Offer to Purchase, the Letter of Transmittal and the
Notice of Guaranteed Delivery may be obtained from the Information Agent or from
brokers, dealers, commercial banks or trust companies.
This Offer is being made for the securities of a Canadian issuer the Shares
of which are listed only on a public market in the United States. The
enforcement by shareholders of civil liabilities under United States federal
securities laws may be adversely affected by the fact that the Company is
incorporated under the laws of British Columbia, and that some of its directors
and officers are residents of Canada.
------------------
The Dealer Managers for the Offer are:
<TABLE>
<S> <C>
In the United States: In Canada:
GOLDMAN, SACHS & CO. GOLDMAN SACHS CANADA
</TABLE>
--------------
The date of this Offer to Purchase is March 20, 1998.
<PAGE>
TABLE OF CONTENTS
<TABLE>
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PAGE
-----------
<S> <C> <C>
INTRODUCTION................................................................................................. 1
RECOMMENDATION OF THE COMPANY'S BOARD OF DIRECTORS........................................................... 2
THE TENDER OFFER............................................................................................. 2
1. Terms of the Offer; Extension of Tender Period; Termination; Amendment............................ 2
2. Acceptance for Payment and Payment for Shares..................................................... 4
3. Procedure for Tendering Shares.................................................................... 5
4. Withdrawal Rights; Statutory Rights............................................................... 7
5. Certain Tax Consequences.......................................................................... 8
6. Price Range of the Shares......................................................................... 12
7. Certain Information Concerning the Company........................................................ 13
8. Certain Information Concerning Purchaser and Parent............................................... 15
9. Background of the Offer........................................................................... 17
10. Purpose of the Offer; the Acquisition Agreement................................................... 18
11. Source and Amount of Funds........................................................................ 32
12. Certain Effects of the Offer...................................................................... 32
13. Certain Conditions of the Offer................................................................... 35
14. Dividends and Distributions....................................................................... 37
15. Certain Legal Matters; Regulatory Approvals....................................................... 38
16. Fees and Expenses................................................................................. 39
17. Miscellaneous..................................................................................... 40
Schedule I--Information Concerning the Directors and Officers
of Parent and Purchaser............................................................................... I-1
</TABLE>
i
<PAGE>
To the Shareholders of International Murex Technologies Corporation:
INTRODUCTION
AAC Acquisition Ltd., a British Columbia company ("Purchaser") and an
indirect wholly owned subsidiary of Abbott Laboratories, an Illinois corporation
("Parent"), hereby offers to purchase all of the outstanding common shares,
without par value (the "Shares"), of International Murex Technologies
Corporation, a British Columbia company (the "Company"), at a purchase price of
U.S.$13.00 per Share (the "Offer Price"), net to the seller in cash, in
accordance with the terms and subject to the conditions set forth in this Offer
to Purchase and in the related Letter of Transmittal (which, as amended from
time to time, collectively constitute the "Offer").
The Offer is being made in connection with an Acquisition Agreement (the
"Acquisition Agreement") dated as of March 13, 1998, among the Company,
Purchaser and Parent. The Acquisition Agreement requires, on the terms and
subject to the conditions set forth therein, Purchaser to offer to purchase all
of the outstanding Shares of the Company pursuant to the Offer. If Purchaser
purchases Shares pursuant to the Offer, it intends to exercise its statutory
right, if available, to acquire all of the Shares not purchased pursuant to the
Offer (the "Compulsory Acquisition"). To effect a Compulsory Acquisition,
Purchaser must own 90% or more of the outstanding Shares. If a Compulsory
Acquisition is not available, Purchaser intends, subject to certain conditions,
to effect a transaction involving the amalgamation or other business combination
of Purchaser and the Company (the "Amalgamation"). In the event Purchaser
effects the Compulsory Acquisition, holders of Shares which were not purchased
in the Offer will have rights to apply to court and, in the event Purchaser
effects the Amalgamation, a holder of Shares who did not tender such Shares in
the Offer will have rights of dissent, all in accordance with British Columbia
law.
THE COMPANY'S BOARD OF DIRECTORS UNANIMOUSLY HAS DETERMINED THAT EACH OF (1)
THE OFFER AND (2) EITHER THE COMPULSORY ACQUISITION OR THE AMALGAMATION (AS THE
CASE MAY BE) IS FAIR TO AND IN THE BEST INTERESTS OF THE SHAREHOLDERS OF THE
COMPANY AND UNANIMOUSLY HAS APPROVED THE OFFER AND EITHER THE COMPULSORY
ACQUISITION OR THE AMALGAMATION AND RECOMMENDS THAT SHAREHOLDERS OF THE COMPANY
ACCEPT THE OFFER AND TENDER THEIR SHARES. SEE "RECOMMENDATION OF THE COMPANY'S
BOARD OF DIRECTORS."
Tendering shareholders will not be obligated to pay brokerage fees or
commissions or, except as set forth in Instruction 6 of the Letter of
Transmittal, transfer taxes on the transfer and sale of Shares pursuant to the
Offer. Purchaser will pay all fees and expenses of Goldman, Sachs & Co., which
are acting as Dealer Managers in the United States for the Offer, and Goldman
Sachs Canada, which are acting as Dealer Managers in Canada for the Offer
(collectively, in such capacity, the "Dealer Managers"), The Bank of New York
(the "Depositary") and Georgeson & Company Inc. (the "Information Agent")
incurred in connection with the Offer. See Section 16.
The purpose of the Offer is for Parent, through Purchaser, to acquire any
and all outstanding Shares and to facilitate either the Compulsory Acquisition
or the Amalgamation. As of March 13, 1998, each Share of the Company had a value
of U.S.$10.6875, based on the closing market price of the Company's Shares on
that date. The Offer provides an opportunity to existing shareholders of the
Company to sell Shares at a premium over recent trading prices. See Section 6.
THE OFFER IS CONDITIONED, AMONG OTHER THINGS, UPON SATISFACTION, IN
PURCHASER'S SOLE DISCRETION, OF THE FOLLOWING CONDITIONS: (1) THE CONDITION THAT
THERE SHALL HAVE BEEN VALIDLY TENDERED AND NOT PROPERLY WITHDRAWN ON OR PRIOR TO
THE EXPIRATION DATE OF THE OFFER A NUMBER OF SHARES WHICH CONSTITUTES AT LEAST
75% OF THE COMPANY'S OUTSTANDING VOTING POWER (ASSUMING THE EXERCISE OF ALL
OUTSTANDING OPTIONS TO PURCHASE SHARES WHICH OPTIONS ARE NOT SUBJECT TO BINDING
AGREEMENTS TO CANCEL) (THE "MINIMUM CONDITION"), AND (2) THE EXPIRATION OR
TERMINATION OF ANY APPLICABLE WAITING PERIOD UNDER THE HART-SCOTT-RODINO
ANTITRUST IMPROVEMENTS ACT OF 1976, AS AMENDED (THE "HSR ACT"), THE CANADIAN
COMPETITION ACT, THE INVESTMENT CANADA ACT, ANY APPLICABLE REQUIREMENTS OF ANY
LAWS OR REGULATIONS RELATING TO THE REGULATION OF MONOPOLIES OR COMPETITION IN
GERMANY OR ANY
<PAGE>
APPLICABLE REQUIREMENTS OF THE UNITED KINGDOM FAIR TRADING ACT. CERTAIN OTHER
CONDITIONS TO THE OFFER ARE DESCRIBED IN SECTION 13.
As of March 12, 1998, there were outstanding 16,826,599 Shares. As of March
12, 1998, options covering a total of 1,655,000 Shares were outstanding.
Purchaser estimates that up to approximately 13,875,000 Shares will need to be
validly tendered (and not validly withdrawn) to satisfy the Minimum Condition.
THIS OFFER TO PURCHASE DOES NOT CONSTITUTE A SOLICITATION OF A PROXY,
CONSENT OR AUTHORIZATION FOR OR WITH RESPECT TO AN ANNUAL MEETING OR ANY SPECIAL
MEETING OF THE COMPANY'S SHAREHOLDERS OR ANY ACTION IN LIEU THEREOF. ANY SUCH
SOLICITATION, IF REQUIRED, WILL BE MADE ONLY PURSUANT TO SEPARATE PROXY
MATERIALS IN COMPLIANCE WITH THE REQUIREMENTS OF SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED (THE "EXCHANGE ACT").
* * * * *
Subject to certain exceptions set forth below, Purchaser expressly reserves
the right to waive any one or more of the conditions to the Offer. See Sections
1 and 13.
Shareholders are urged to read this Offer to Purchase and the related Letter
of Transmittal carefully before deciding whether to tender their Shares.
RECOMMENDATION OF THE COMPANY'S BOARD OF DIRECTORS
The Company's Board of Directors unanimously has determined that each of (1)
the Offer and (2) either the Compulsory Acquisition or the Amalgamation is fair
to and in the best interests of the shareholders of the Company and unanimously
has approved the Offer and either the Compulsory Acquisition or the Amalgamation
and recommends that the shareholders of the Company accept the Offer and tender
their Shares. The Offer is being effected to acquire any and all outstanding
Shares and to facilitate either the Compulsory Acquisition or the Amalgamation.
The Company's Board of Directors believes that a business combination of the
Company and Parent is in the best long-term interests of the Company and its
shareholders. The Offer allows shareholders to receive cash at a premium over
recent trading prices for the Company's Shares. See Sections 6 and 9.
The Company's financial advisor, Donaldson, Lukfin & Jenrette Securities
Corporation ("DLJ") has delivered to the Company's Board of Directors its
written opinion dated March 15, 1998 to the effect that, as of the date of such
opinion, the consideration to be received by the holders of Shares pursuant to
the Offer and either the Compulsory Acquisition or the Amalgamation is fair to
such holders from a financial point of view.
THE TENDER OFFER
1. TERMS OF THE OFFER; EXTENSION OF TENDER PERIOD; TERMINATION; AMENDMENT
Upon the terms and subject to the conditions of the Offer (including, if the
Offer is extended or amended, the terms and conditions of any such extension or
amendment), Purchaser will accept for payment and pay for all Shares validly
tendered and not properly withdrawn on or prior to the Expiration Date (as
hereinafter defined) at a price of U.S.$13.00 per Share, net to the seller in
cash. The term "Expiration Date" means 12:00 Midnight, New York City time, on
Thursday, April 16, 1998, unless Purchaser shall have extended the period during
which the Offer is open, in which event the term "Expiration Date" shall mean
the latest time and date at which the Offer, as so extended by Purchaser, shall
expire.
2
<PAGE>
The Offer is conditioned upon, among other things, satisfaction of the
Minimum Condition, the expiration or termination of any waiting period under the
HSR Act, the Canadian Competition Act, the Investment Canada Act, any applicable
requirements of any laws or regulations relating to the regulation of monopolies
or competition in Germany or applicable requirements of the United Kingdom Fair
Trading Act. The Offer is also subject to certain other conditions set forth in
Section 13. Subject to certain exceptions set forth below, Purchaser expressly
reserves the right, in its sole discretion, to waive, in whole or in part, any
or all of the conditions of the Offer.
Purchaser expressly reserves the right, in its sole discretion, at any time
or from time to time, to extend the period during which the Offer is open for
any reason, including the non-satisfaction of any of the conditions specified in
Section 13, by giving oral or written notice of such extension to the
Depositary. During any such extension, all Shares previously tendered and not
properly withdrawn will remain subject to the Offer, subject to the rights of a
tendering shareholder to withdraw such shareholder's Shares. There can be no
assurance that Purchaser will exercise its right to extend the Offer.
Purchaser also expressly reserves the right, subject to applicable laws
(including applicable regulations of the Securities and Exchange Commission (the
"Commission")), in its sole discretion, at any time or from time to time, to (i)
delay acceptance for payment of or, regardless of whether such Shares were
theretofore accepted for payment, payment for any Shares in order to comply, in
whole or in part, with any applicable law, government regulation or any other
condition contained in Sections 13 and 15, (ii) terminate the Offer (whether or
not any Shares have theretofore been accepted for payment) if any of the
conditions referred to in Section 13 have not been satisfied or upon the
occurrence of any of the events specified in Section 13 and (iii) subject to
certain exceptions set forth below, waive any condition or otherwise amend the
Offer in any respect); in each case by giving oral or written notice of such
delay, termination, waiver or amendment to the Depositary and by causing the
Depositary to provide as soon as practicable thereafter a copy of such notice to
all holders of Shares whose Shares have not been taken up prior to the
extension. Purchaser acknowledges that (i) Rule 14e-1(c) under the Exchange Act
requires Purchaser to pay the consideration offered or return the Shares
tendered promptly after the termination or withdrawal of the Offer and (ii)
Purchaser may not delay acceptance for payment of, or payment for (except as
provided by clause (i) of the preceding sentence), any Shares upon the
occurrence of any of the conditions specified in Section 13 without extending
the period of time during which the Offer is open.
Purchaser may increase the Offer Price and may make any other changes in the
terms and conditions of the Offer, provided that Purchaser may only waive the
Minimum Condition as long as Purchaser purchases at least a majority of the
Shares outstanding (assuming the exercise of all outstanding options to purchase
Shares which options are not subject to binding agreements to cancel) and that,
unless previously approved by the Company in writing, no change may be made that
decreases the price per Share payable in the Offer, changes the form of
consideration payable in the Offer, reduces the maximum number of Shares to be
purchased in the Offer below a majority of the Shares outstanding (assuming the
exercise of all outstanding options to purchase Shares which options are not
subject to binding agreements to cancel), imposes conditions to the Offer in
addition to the conditions set forth in Section 13 or otherwise amends the terms
of the Offer in any way that would be materially adverse to holders of Shares.
Any such extension, delay, termination, waiver or amendment will be followed
as promptly as practicable by public announcement thereof, and such announcement
in the case of an extension will be made no later than 9:00 a.m., New York City
time, on the next business day after the previously scheduled Expiration Date.
Without limiting the manner in which Purchaser may choose to make any public
announcement, except as provided by applicable law (including Rules 14d-4(c) and
14d-6(d) under the Exchange Act, which require that material changes be promptly
disseminated to holders of Shares), Purchaser shall have no obligation to
publish, advertise or otherwise communicate
3
<PAGE>
any such announcement other than by issuing a release to the Dow Jones News
Service or as otherwise may be required by law.
If Purchaser makes a material change in the terms of the Offer or if
Purchaser waives a material condition of the Offer, Purchaser will extend the
Offer to the extent required by Rules 14d-4(c) and 14d-6(d) under the Exchange
Act and as required under Canadian securities laws. Under Canadian laws, except
for a variation in the terms of the Offer consisting solely of the waiver of a
condition, if the terms of the Offer are varied, the Offer shall not expire
before ten days after the notice of variation has been given to shareholders.
Under U.S. laws, the minimum period during which an offer must remain open
following material changes in the terms of the Offer, other than a change in
price or a change in the percentages of securities sought, will depend on the
facts and circumstances, including the materiality, of the changes. With respect
to a change in price or, subject to certain limitations, a change in the
percentage of securities sought, a minimum ten business day period from the day
of such change is generally required to allow for adequate dissemination to
shareholders. Accordingly, if prior to the Expiration Date, Purchaser decreases
the number of Shares being sought, increases or decreases the consideration
offered pursuant to the Offer and if the Offer is scheduled to expire at any
time earlier than the period ending on the tenth business day from the date of
that notice of such increase or decrease is first published, sent or given to
shareholders, the Offer will be extended at least until the expiration of such
ten business day period. Any extension of the Offer will not constitute a waiver
by Purchaser of any of the conditions set forth in Section 13.
2. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES
Upon the terms and subject to the conditions of the Offer (including, if the
Offer is extended or amended, the terms and conditions of any such extension or
amendment), Purchaser will accept for payment and will pay for all Shares
validly tendered and not properly withdrawn on or prior to the Expiration Date
as soon as practicable after the later to occur of: (i) the Expiration Date and
(ii) the date of satisfaction or waiver of the conditions set forth in Section
13. In addition, Purchaser reserves the right, in its sole discretion and
subject to applicable law, to delay acceptance for payment of or payment for
Shares in order to comply, in whole or in part, with any applicable law,
government regulation or any other condition contained herein. See Section 13.
For purposes of the Offer, Purchaser shall be deemed to have accepted for
payment and thereby purchased tendered Shares of the Company if, as and when
Purchaser gives oral or written notice to the Depositary of its acceptance of
such Shares for payment pursuant to the Offer. Payment for Shares of the Company
accepted for payment pursuant to the Offer will be made by deposit by Purchaser
of the purchase price to be paid by it with the Depositary, which Depositary
will act as agent for the tendering shareholders for the purpose of receiving
payments from Purchaser and transmitting such payments to tendering
shareholders. Under no circumstances will interest be paid by Purchaser on the
consideration paid for the Shares of the Company pursuant to the Offer,
regardless of any delay in making such payment. Purchaser will pay all stock
transfer taxes, if any, payable on the transfer of Shares of the Company
purchased by it pursuant to the Offer, except as set forth in Instruction 6 of
the Letter of Transmittal.
In all cases, payment for Shares tendered and accepted for payment pursuant
to the Offer will be made only after timely receipt by the Depositary of a
certificate(s) for such Shares or a timely confirmation of a book-entry transfer
of such Shares into the Depositary's account at a Book-Entry Transfer Facility
(as defined in Section 3), a Letter of Transmittal (or a facsimile thereof),
properly completed and duly executed, with any required signature guarantees or
Agent's Message (as defined in Section 3) and any other documents required by
the Letter of Transmittal. For a description of the procedure for tendering
Shares of the Company pursuant to the Offer, see Section 3.
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If any tendered Shares are not accepted for payment for any reason or if
certificate(s) are submitted for more Shares than are tendered, certificates
evidencing unpurchased or untendered Shares will be returned without expense to
the tendering shareholder (or, in the case of Shares tendered by book-entry
transfer into the Depositary's account at a Book-Entry Transfer Facility
pursuant to the procedures set forth in Section 3, such Shares will be credited
to an account maintained at such Book-Entry Transfer Facility) as promptly as
practicable following the expiration, termination or withdrawal of the Offer.
If Purchaser increases the consideration offered to shareholders pursuant to
the Offer, such increased consideration will be paid to all shareholders whose
Shares are purchased pursuant to the Offer, whether or not such Shares were
tendered or accepted for payment prior to such increase in consideration.
Purchaser reserves the right to assign, in whole or from time to time in
part, to Parent or a direct or indirect subsidiary of Parent, the right to
purchase all or any portion of the Shares tendered pursuant to the Offer, but
any such assignment will not relieve Purchaser of its obligations under the
Offer nor will any such assignment prejudice in any way the rights of tendering
shareholders to receive payment for Shares validly tendered and accepted for
payment pursuant to the Offer.
During the pendency of the Offer, Purchaser will not purchase any Shares,
whether in the open market or otherwise, except pursuant to the Offer.
3. PROCEDURE FOR TENDERING SHARES
VALID TENDER OF SHARES. Except as set forth below, in order for Shares to
be validly tendered pursuant to the Offer, the Letter of Transmittal (or a
facsimile thereof), properly completed and duly executed, together with any
required signature guarantees, or an Agent's Message (as defined below) in
connection with a book-entry delivery of Shares as described below, and any
other documents required by the Letter of Transmittal, must be received by the
Depositary at one of its addresses set forth on the back cover of this Offer to
Purchaser. In addition, either (i) certificates evidencing tendered Shares must
be received by the Depositary at any such address or such Shares must be
tendered pursuant to the procedure for book-entry transfer (and a confirmation
of receipt of such delivery must be received by the Depositary), in each case,
on or prior to the Expiration Date or (ii) the guaranteed delivery procedures
set forth below must be complied with. The term "Agent's Message" means a
message transmitted by The Depositary Trust Company or Philadelphia Depositary
Trust Company (each, a "Book-Entry Transfer Facility") to and received by the
Depositary and forming a part of a Book-Entry Confirmation, which states that
such Book-Entry Transfer Facility has received an express acknowledgment from
the participant in such Book-Entry Transfer Facility tendering the Shares which
are the subject of such Book-Entry Confirmation, that such participant has
received and agrees to be bound by the terms of the Letter of Transmittal and
that Purchaser may enforce such agreement against such participant.
BOOK-ENTRY TRANSFER. The Depositary will establish an account with respect
to the Shares at the Book-Entry Transfer Facilities for purposes of the Offer
within two business days after the date of this Offer to Purchase. Any financial
institution that is a participant in the system of any Book-Entry Transfer
Facility may make book-entry delivery of Shares by causing a Book-Entry Transfer
Facility to transfer such Shares into the Depository's account in accordance
with that Book-Entry Transfer Facility's procedures for such transfer. Although
delivery of Shares may be effected through book-entry transfer at a Book-Entry
Transfer Facility, the Letter of Transmittal (or a facsimile thereof), properly
completed and duly executed, together with any required signature guarantees, or
an Agent's Message in connection with a book-entry transfer, and any other
required documents, must, in any case, be received by the Depositary at one of
its addresses set forth on the back cover of this Offer to Purchase on or prior
to the Expiration Date, or the guaranteed delivery procedures described below
must be complied with.
DELIVERY OF DOCUMENTS TO A BOOK-ENTRY TRANSFER FACILITY IN ACCORDANCE WITH
SUCH BOOK-ENTRY TRANSFER FACILITY'S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO
THE DEPOSITARY.
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SIGNATURE GUARANTEES. Except as otherwise provided below, signatures on
Letters of Transmittal must be guaranteed by a member firm of a registered
national securities exchange, a member of the National Association of Securities
Dealers, Inc. (the "NASD"), or a commercial bank or trust company having an
office or correspondent in the United States, a Canadian chartered bank, a trust
company in Canada, a commercial bank or trust company having an office, branch
or agency in the United States or a member firm of the Toronto, Montreal or
Vancouver Stock Exchanges (each of the foregoing constituting an "Eligible
Institution"). Signatures on Letters of Transmittal need not be guaranteed if
(i) the Letter of Transmittal is signed by the registered holder of Shares
tendered and such holder has not completed either the box entitled "Special
Delivery Instructions" or the box entitled "Special Payment Instructions" on the
Letter of Transmittal, or (ii) such Shares are tendered for the account of an
Eligible Institution. See Instructions 1 and 5 of the Letter of Transmittal.
If the certificates representing Shares are registered in the name of a
person other than the signer of the Letter of Transmittal, or if payment is to
be made or certificates for Shares not accepted for payment or not tendered are
to be returned to a person other than the registered holder, then the tendered
certificates must be endorsed or accompanied by appropriate stock powers, in
either case signed exactly as the name(s) of the registered holder(s) appear(s)
on the certificates, with the signatures on the certificates or stock powers
guaranteed as described above. See Instructions 1 and 5 of the Letter of
Transmittal.
GUARANTEED DELIVERY. If a shareholder desires to tender Shares pursuant to
the Offer and such shareholder's certificates are not immediately available, or
such shareholder cannot deliver the certificates and all other required
documents to reach the Depositary on or prior to the Expiration Date, or such
shareholder cannot complete the procedure for book-entry transfer on a timely
basis, such Shares may nevertheless be tendered if the following guaranteed
delivery procedures are satisfied:
(i) such tender is made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form provided by Purchaser, is received by
the Depositary as provided below on or prior to the Expiration Date; and
(iii) the certificates (or a book-entry transfer confirmation)
representing all tendered Shares, in proper form for transfer, in each case
together with the Letter of Transmittal (or a facsimile thereof) properly
completed and duly executed, with any required signature guarantees (or, in
the case of a book-entry transfer, an Agent's Message) and any other
documents required by the Letter of Transmittal are received by the
Depositary within three Nasdaq National Market System ("Nasdaq NMS") trading
days after the date of execution of such Notice of Guaranteed Delivery.
The Notice of Guaranteed Delivery may be delivered by hand or transmitted by
telegram, telex, facsimile transmission or mail to the Depositary and must
include a guarantee by an Eligible Institution in the form set forth in such
Notice of Guaranteed Delivery.
THE METHOD OF DELIVERY OF CERTIFICATES AND ALL OTHER REQUIRED DOCUMENTS,
INCLUDING DELIVERY THROUGH ANY BOOK-ENTRY TRANSFER FACILITY, IS AT THE OPTION
AND RISK OF THE TENDERING SHAREHOLDER AND THE DELIVERY WILL BE DEEMED MADE ONLY
WHEN ACTUALLY RECEIVED BY THE DEPOSITARY. IF DELIVERY IS BY MAIL, REGISTERED
MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED IS RECOMMENDED. IN ALL
CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO INSURE TIMELY DELIVERY.
BACKUP FEDERAL INCOME TAX WITHHOLDING. To prevent backup federal income tax
withholding on payments made to shareholders with respect to the purchase price
of Shares purchased pursuant to the Offer, each such shareholder must provide
the Depositary with such shareholder's correct taxpayer identification number
("TIN") and certify that such shareholder is not subject to backup United States
federal income tax withholding by completing the substitute Form W-9 included in
the Letter of Transmittal. See Instruction 8 of the Letter of Transmittal.
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APPOINTMENT AS PROXY. By executing a Letter of Transmittal, a tendering
shareholder irrevocably appoints designees of Purchaser as such shareholder's
proxies in the manner set forth in the Letter of Transmittal to the full extent
of such shareholder's rights with respect to the Shares tendered by such
shareholder and accepted for payment by Purchaser (and with respect to any and
all other Shares or other securities issued or issuable in respect of such
Shares on or after the date of this Offer to Purchase). All such proxies shall
be irrevocable and coupled with an interest in the tendered Shares. Such
appointment will be effective when, and only to the extent that, Purchaser
accepts such Shares for payment. Upon such acceptance for payment, all prior
proxies and consents granted by such shareholder with respect to such Shares and
other securities will be revoked without further action, and no subsequent
proxies may be given nor subsequent written consents executed (and, if given or
executed, such proxies or consents will not be deemed effective). The designees
of Purchaser will be empowered to exercise all voting and other rights of such
shareholder as they, in their sole discretion, may deem proper at any annual,
special or adjourned meeting of the Company's shareholders, by written consent
or otherwise. Purchaser reserves the right to require that, in order for Shares
to be deemed validly tendered, immediately upon Purchaser's payment for such
Shares, Purchaser must be able to exercise full voting rights with respect to
such Shares, including voting at any meeting of shareholders scheduled or acting
by written consent without a meeting.
DETERMINATION OF VALIDITY. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance for payment of any tender
of Shares will be determined by Purchaser in its sole discretion, which
determination shall be final and binding. Purchaser reserves the absolute right
to reject any and all tenders of Shares determined by it not to be in proper
form or the acceptance for payment of which may, in the opinion of Purchaser's
counsel, be unlawful. Purchaser reserves the absolute right to waive any defect
or irregularity in any tender of Shares of any particular shareholder.
Purchaser's interpretation of the terms and conditions of the Offer (including
the Letter of Transmittal and the Instructions thereto) will be final and
binding. None of Purchaser, Parent, any of their affiliates or assigns, the
Dealer Managers, the Depositary, the Information Agent or any other person will
be under any duty to give notification of any defects or irregularities in
tenders or incur any liability for failure to give any such notification.
4. WITHDRAWAL RIGHTS; STATUTORY RIGHTS
Tenders of Shares pursuant to the Offer may be withdrawn at any time on or
prior to the Expiration Date (or such later date as may apply in case the Offer
is extended). Thereafter, such tenders are irrevocable, except that they may be
withdrawn after May 4, 1998 unless theretofore accepted for payment as provided
in this Offer to Purchase. If Purchaser extends the Offer, is delayed in
accepting for payment or paying for Shares or is unable to accept for payment or
pay for Shares pursuant to the Offer for any reason, then, without prejudice to
Purchaser's rights under the Offer, the Depositary may, on behalf of Purchaser,
retain all Shares tendered, and such Shares may not be withdrawn except to the
extent that tendering shareholders are entitled to withdrawal rights as set
forth in this Section 4.
For a withdrawal to be effective, a written, telegraphic, telex or facsimile
transmission notice of withdrawal must be timely received by the Depositary at
one of its addresses set forth on the back cover of this Offer to Purchase. Any
notice of withdrawal must specify the name of the person who tendered the Shares
to be withdrawn, the number of Shares to be withdrawn and the name of the
registered holder, if different from that of the person who tendered such
Shares. If certificates evidencing Shares to be withdrawn have been delivered or
otherwise identified to the Depositary, then prior to the physical release of
such certificates, the serial numbers shown on such certificates must be
submitted to the Depositary, and the signatures on the notice of withdrawal must
be guaranteed by an Eligible Institution unless such Shares have been tendered
for the account of an Eligible Institution. If Shares have been tendered
pursuant to the procedure for book-entry transfer set forth in Section 3, the
notice of withdrawal
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must specify the name and number of the account at the Book-Entry Transfer
Facility to be credited with the withdrawn Shares.
Withdrawals may not be rescinded, and Shares withdrawn will thereafter be
deemed not validly tendered for purposes of the Offer. However, withdrawn Shares
of the Company may be retendered at any time prior to the Expiration Date by
again following one of the procedures described in Section 3.
All questions as to the form and validity (including time of receipt) of any
notice of withdrawal will be determined by Purchaser, in its sole discretion,
whose determination shall be final and binding. None of Purchaser, Parent, any
of their affiliates or assigns, the Dealer Managers, the Depositary, the
Information Agent or any other person will be under any duty to give
notification of any defects or irregularities in any notice of withdrawal or
incur any liability for failure to give such notification.
Securities legislation in certain of the provinces and territories of Canada
provides holders of Shares with, in addition to any other rights they may have
at law, rights of rescission or to damages, or both, if there is a
misrepresentation in a circular or a notice that is required to be delivered to
the holders of Shares. However, such rights must be exercised within prescribed
time limits. Holders of Shares should refer to the applicable provisions of the
securities legislation of their province or territory for particulars of those
rights or consult with legal counsel.
5. CERTAIN TAX CONSEQUENCES
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS. The following is a
summary of certain United States federal income tax considerations of the Offer
and either the Compulsory Acquisition or the Amalgamation to holders whose
Shares are purchased pursuant to the Offer or either the Compulsory Acquisition
or the Amalgamation (including any cash amounts received by dissenting
shareholders pursuant to the exercise of appraisal rights). The discussion is
for general information only and does not purport to consider all aspects of
United States federal income taxation that may be relevant to holders of Shares.
The discussion is based on current provisions of the Internal Revenue Code of
1986, as amended (the "Code"), existing, proposed and temporary regulations
promulgated thereunder and administrative and judicial interpretations thereof,
all of which are subject to change. The discussion applies only to holders of
Shares in whose hands Shares are capital assets within the meaning of Section
1221 of the Code, and may not apply to Shares received pursuant to the exercise
of employee stock options or otherwise as compensation, or to certain types of
holders of Shares (such as insurance companies, tax-exempt organizations and
broker-dealers) who may be subject to special rules under the United States
federal income tax laws. This discussion does not discuss the United States
federal income tax consequences to a holder of Shares who, for United States
federal income tax purposes, is a non-resident alien individual, a foreign
corporation, a foreign partnership or a foreign estate or trust, nor does it
consider the effect of any foreign, state or local tax laws. See "Certain
Canadian Federal Income Tax Considerations" below.
BECAUSE INDIVIDUAL CIRCUMSTANCES MAY DIFFER, EACH HOLDER OF SHARES SHOULD
CONSULT SUCH HOLDER'S OWN TAX ADVISOR TO DETERMINE THE APPLICABILITY OF THE
RULES DISCUSSED BELOW TO SUCH HOLDER AND THE PARTICULAR TAX EFFECTS TO SUCH
HOLDER OF THE OFFER AND EITHER THE COMPULSORY ACQUISITION OR THE AMALGAMATION,
INCLUDING THE APPLICATION AND EFFECT OF STATE, LOCAL AND OTHER INCOME TAX LAWS.
The receipt of cash for Shares pursuant to the Offer or either the
Compulsory Acquisition or the Amalgamation (including any cash amounts received
by dissenting shareholders pursuant to the exercise of appraisal rights) will be
a taxable transaction for United States federal income tax purposes. In general,
for United States federal income tax purposes, a tendering shareholder will
recognize gain or loss equal to the difference between (i) the holder's adjusted
tax basis in the Shares tendered pursuant to the Offer or either the Compulsory
Acquisition or the Amalgamation and (ii) the amount of cash received therefor.
Gain or loss must be determined separately for each block of Shares (i.e.,
Shares acquired at the same cost in a single transaction) sold pursuant to the
Offer or either the Compulsory
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Acquisition or the Amalgamation. Assuming that Shares are held as a capital
asset, such gain or loss will be a capital gain or loss. Any such capital gain
will be a long-term capital gain taxable to a non-corporate holder at a maximum
rate of 20% if the holder's Shares have been held for more than 18 months on the
date of sale (in the case of the Offer) or the Effective Time of either the
Compulsory Acquisition or the Amalgamation (in the case of either the Compulsory
Acquisition or the Amalgamation); a long-term capital gain taxable to a
non-corporate holder at a maximum rate of 28% if the Shares have been held for
more than one year but not more than 18 months on the date of the sale (or the
Effective Time of either the Compulsory Acquisition or the Amalgamation) and a
short-term capital gain taxable to a non-corporate holder at a maximum rate of
up to 39.6% if the Shares have been held for one year or less on the date of
sale (or the Effective Time of either the Compulsory Acquisition or the
Amalgamation).
Payments in connection with the Offer or either the Compulsory Acquisition
or the Amalgamation may be subject to "backup withholding" at a rate of 31%,
unless a holder of Shares (i) is a corporation or comes within certain exempt
categories and, when required, demonstrates this fact or (ii) provides a correct
TIN to the payor, certifies as to no loss of exemption from backup withholding
and otherwise complies with applicable requirements of the backup withholding
rules. A holder who does not provide a correct TIN may be subject to penalties
imposed by the Internal Revenue Service. Any amount paid as backup withholding
does not constitute an additional tax and will be creditable against the
holder's Untied States federal income tax liability. Each holder of Shares
should consult with his or her qualification for exemption from backup
withholding and the procedure for obtaining such exemption. Holders tendering
their Shares in the Offer may prevent backup withholding by completing the
Substitute Form W-9 included in the Letter of Transmittal. See Section 3.
CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS. The following is a
summary of the principal income tax considerations under the INCOME TAX ACT
(Canada) (the "Tax Act") generally applicable to a shareholder who sells Shares
pursuant to the Offer or otherwise disposes of Shares pursuant to the Compulsory
Acquisition or the Amalgamation. This summary is based on the current provisions
of the Tax Act, the regulations thereunder, and counsel's understanding of the
current administrative practices of Revenue Canada. The summary takes into
account all specific proposals to amend the Tax Act and the regulations publicly
announced by the Minister of Finance (Canada) prior to the date hereof, although
there is no certainty that such proposals will be enacted in the form proposed,
if at all. The summary does not otherwise take into account or anticipate any
changes in law, whether by judicial, governmental or legislative decision or
action or changes in administrative practices of Revenue Canada, nor does it
take into account provincial, territorial or foreign income tax considerations.
The provisions of provincial income tax legislation vary between provinces in
Canada and in some cases differ from Canadian federal income tax legislation.
THIS SUMMARY IS OF A GENERAL NATURE ONLY AND IS NOT INTENDED TO BE, NOR
SHOULD IT BE CONSTRUED TO BE, LEGAL OR TAX ADVICE OR REPRESENTATIONS TO ANY
PARTICULAR HOLDER OF SHARES FOR WHICH THE OFFER IS MADE. ACCORDINGLY,
SHAREHOLDERS SHOULD CONSULT THEIR OWN TAX ADVISERS WITH RESPECT TO THEIR
PARTICULAR CIRCUMSTANCES, INCLUDING THE APPLICATION AND EFFECT OF THE INCOME AND
OTHER TAX LAWS OF ANY COUNTRY, PROVINCE, STATE OR LOCAL TAX AUTHORITY.
RESIDENTS OF CANADA
The following summary is generally applicable to a shareholder who, for
purposes of the Tax Act, is, or is deemed to be, resident in Canada, deals at
arm's length with the Company and Purchaser, is not affiliated with the Company
or Purchaser, is not a financial institution (to which the mark-to-market rules
may be applicable) and who holds Shares as capital property. Shares will
generally be considered to be capital property to a shareholder unless the
shareholder holds such Shares in the course of carrying on a business, or the
shareholder has acquired them in a transaction or transactions considered to be
an adventure or concern in the nature of trade. Certain shareholders whose
Shares might not otherwise qualify as capital property may, in certain
circumstances, treat Shares as capital property by making the election permitted
by subsection 39(4) of the Tax Act.
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SALE PURSUANT TO THE OFFER
A shareholder who disposes of Shares to Purchaser pursuant to the Offer will
realize a capital gain (or capital loss) equal to the amount by which the
proceeds of disposition, net of any reasonable costs of disposition, exceed (or
are exceeded by) the adjusted cost base of the Shares to the shareholder. The
adjusted cost base to a shareholder of Shares is generally the aggregate of each
amount which is the cost to the holder of a Share, divided by the number of
Shares held by such shareholder.
A shareholder will be required to include three-quarters of the amount of
any resulting capital gain (a "Taxable Capital Gain") in income, and will be
permitted to deduct three-quarters of the amount of any resulting capital loss
(an "Allowable Capital Loss") against Taxable Capital Gains realized in the year
of disposition. Allowable Capital Losses not deducted in the taxation year in
which they are realized may be carried back and deducted in any of the three
preceding years or carried forward and deducted in any subsequent year against
Taxable Capital Gains realized in such years, to the extent and under the
circumstances specified in the Tax Act. Capital gains realized by an individual
may be subject to alternative minimum tax.
In general, a capital loss otherwise arising upon the disposition of a Share
by a corporation may be reduced by dividends previously received or deemed to
have been received thereon. Any such reduction will not occur where the
corporate shareholder owned the Share for 365 days or longer immediately before
the disposition and such shareholder (together with persons with whom it did not
deal at arm's length) did not own more than 5% of the shares of any class or
series of the Company at the time the relevant dividends were received or deemed
to have been received. Similar rules may also apply in certain circumstances,
including where a corporation is a member of a partnership or a beneficiary of a
trust that owns Shares. Proposed amendments to the Tax Act contained in Bill
C-28 (first reading December 10, 1997) would require, among other things, that
the shareholder hold the Shares throughout the 365-day period ending immediately
before the disposition, and that the rules be extended to apply where a trust or
partnership is a member of a partnership or a beneficiary of a trust that owns
Shares. In addition, the proposed amendments would reduce a capital loss
realized by an individual, a trust or an individual member of a partnership
where such person received certain capital dividends in respect of Shares. The
proposed amendments will apply to dispositions of Shares pursuant to the Offer.
Shareholders to whom these rules may be relevant should consult their own tax
advisers.
Shareholders which are Canadian controlled private corporations and which
realize Taxable Capital Gains upon the disposition of Shares pursuant to the
Offer, the Compulsory Acquisition or the Amalgamation will be subject to a
refundable tax of 6 2/3% on investment income, including such Taxable Capital
Gains. The refundable tax will be refunded at the rate of one dollar for every
three dollars of taxable dividends paid by the corporation.
COMPULSORY ACQUISITION OF SHARES
As set forth in Section 12, Purchaser may, in certain circumstances, acquire
Shares pursuant to a Compulsory Acquisition in accordance with the provisions of
section 255 of the Company Act (British Columbia) ("BCCA"). The tax consequences
to a shareholder of a disposition of Shares pursuant to such Compulsory
Acquisition will generally be as described under "Sale Pursuant to the Offer"
above.
AMALGAMATION
If Purchaser does not, after purchasing Shares in the Offer, and acquiring
Shares through open market purchases, own enough Shares to effectuate a
Compulsory Acquisition, Purchaser and the Company will amalgamate as described
under Section 12. On the Amalgamation, shareholders who have not tendered their
Shares under the Offer would have each of their Shares exchanged for one
Preference Share of a newly formed company ("Amalco"). Each Preference Share
will be immediately redeemed by Amalco upon payment to the holder of the
Preference Share of the Offer Price.
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Upon the redemption of Preference Shares, the holder thereof would be deemed
to have received a dividend (subject to the potential application of subsection
55(2) of the Tax Act to holders of such Preference Shares that are corporations
as discussed below) equal to the amount by which the price of each Preference
Share exceeds its paid-up capital for purposes of the Tax Act. The difference
between the price per Preference Share and the amount of the deemed dividend
would be treated as proceeds of disposition of such shares for purposes of
computing any capital gain or capital loss arising on the disposition of such
shares.
Subsection 55(2) of the Tax Act provides that where a corporate shareholder
is deemed to receive a dividend under the circumstances described above, all or
part of the deemed dividend may be treated as proceeds of disposition of the
Preference Shares for the purpose of computing the holder's capital gain on the
disposition of such shares. Accordingly, corporate shareholders should consult
their tax advisers for specific advice with respect to the potential application
of this provision. Subject to the potential application of this provision,
dividends deemed to be received by a corporation as a result of the redemption
of the Preference Shares will be included in computing its income, but normally
will also be deductible in computing its taxable income unless a corporation is
a "specified financial institution" as defined in the Tax Act. Dividends deemed
to be received on the Preference Shares by a specified financial institution may
not be deductible in computing its taxable income if the term preferred share
rules in the Tax Act are applicable. Corporations which may be affected by such
rules should consult their own tax advisers.
A shareholder that is a "private corporation" or a "subject corporation" (as
such terms are defined in the Tax Act) may be liable to pay the 33 1/3%
refundable tax under Part IV of the Tax Act on dividends deemed to be received
on the redemption of Preference Shares to the extent that such dividends are
deductible in computing the corporation's taxable income.
In the case of a shareholder who is an individual, dividends deemed to be
received as a result of the redemption of the Preference Shares will be included
in computing the shareholder's income, and will be subject to the gross-up and
dividend tax credit rules normally applicable to taxable dividends paid by a
taxable Canadian corporation.
Under the current administrative practice of Revenue Canada, shareholders
who exercise their right of dissent in respect of the Amalgamation should be
considered to have disposed of the Shares for proceeds equal to the amount paid
by Amalco to the dissenting shareholder therefor, other than interest awarded by
the court. Because of uncertainties under the relevant legislation as to whether
such amounts paid to a dissenting shareholder will be treated entirely as
proceeds of disposition, or in part as the payment of a deemed dividend,
dissenting shareholders should consult with their own tax advisers in this
regard.
NON-RESIDENTS OF CANADA
The following summary is generally applicable to a shareholder who, for
purposes of the Tax Act, is not resident, nor deemed to be resident in Canada,
deals at arm's length with the Company and Purchaser, is not affiliated with the
Company or Purchaser, holds the Shares as capital property and does not use or
hold, and is not deemed to use or hold, the Shares in connection with carrying
on a business in Canada.
A non-resident shareholder will not be subject to tax under the Tax Act on
any capital gain realized on a disposition of Shares of Purchaser pursuant to
the Offer or by virtue of the Compulsory Acquisition of Shares pursuant to
section 255 of the BCCA unless the Shares constitute "taxable Canadian property"
to the shareholder. A non-resident shareholder's capital gain (or capital loss)
in respect of Shares that constitute taxable Canadian property will be equal to
the amount by which the proceeds of disposition of the Shares, net of any
reasonable costs of disposition, exceed (or are exceeded by) the adjusted cost
base of the Shares to the non-resident shareholder. The non-resident shareholder
will be
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required to include three-quarters of any resulting capital gain in income and
will be required to deduct three-quarters of the amount of any resulting capital
loss against taxable gains realized in the year of disposition from the
disposition of taxable Canadian property.
A Share will be taxable Canadian property to a non-resident if, at any time
during the five-year period immediately preceding the disposition, the
non-resident, either alone or together with persons with whom the non-resident
did not deal at arm's length, owned 25% or more of the shares of any class or
series of the Company. For this purpose, a holder of an option to acquire Shares
of the Company will be considered to own any shares to which such option
relates. The Shares may also be taxable Canadian property where the shareholder
elected to have them treated as taxable Canadian property upon ceasing to be a
resident of Canada. Even if the Shares are taxable Canadian property to a
non-resident, any capital gain realized upon the disposition may be exempt from
tax under the Tax Act pursuant to the provision of an applicable international
tax treaty to which Canada is a party.
If Purchaser does not acquire all the Shares pursuant to the Offer or the
Compulsory Acquisition, and the Company and Purchaser consummate the
Amalgamation, a non-resident shareholder will realize a deemed dividend upon
redemption of the Preference Shares calculated as described above. Dividends
paid or deemed to be paid to a non-resident will be subject to Canadian
withholding tax at a rate of 25%. Such rate may be reduced under the provision
of an applicable international tax treaty to which Canada is a party.
Non-resident shareholders should consult their own tax advisers for advice with
respect to the potential income tax consequences to them of the Amalgamation.
6. PRICE RANGE OF THE SHARES
The Company's Shares are listed and quoted on the Nasdaq NMS under the
symbol MURXF. The following table sets forth, for the periods indicated, the
high and low closing prices per share for the Shares for the periods indicated.
<TABLE>
<CAPTION>
SHARES
-----------------
HIGH LOW
------- -------
<S> <C> <C>
1996:
First Quarter................. U.S.$311/16 U.S.$25/16
Second Quarter................ 5 1/16 2 5/8
Third Quarter................. 6 3/8 2 15/16
Fourth Quarter................ 7 5/8 4 7/8
1997:
First Quarter................. 9 3/4 6 1/2
Second Quarter................ 10 5/8 5 3/4
Third Quarter................. 10 5/8 7 7/8
Fourth Quarter................ 10 1/8 7 5/8
</TABLE>
12
<PAGE>
The following table sets forth for the periods indicated, the high and low
closing prices per Share for the Shares and the total trading volume during such
periods.
<TABLE>
<CAPTION>
HIGH LOW VOLUME
------- ------- --------------
<S> <C> <C> <C>
1997:
February.................... U.S.$93/4 U.S.$81/8 1,276,500
March....................... 8 7/8 6 5/8 1,303,100
April....................... 7 3/4 5 3/4 1,416,700
May......................... 10 5/8 5 15/16 3,772,000
June........................ 10 8 1,071,400
July........................ 9 5/8 8 1/8 1,127,300
August...................... 9 3/8 7 7/8 1,400,700
September................... 10 5/8 8 1/8 3,143,100
October..................... 9 7/8 7 5/8 1,228,300
November.................... 10 8 1/2 1,300,400
December.................... 10 1/8 9 1,077,100
1998:
January..................... 10 3/8 9 950,500
February.................... 10 8 3/16 1,077,600
March (through 3/18/98)..... 12 7/8 8 1/2 5,766,700
</TABLE>
On March 13, 1998, the last full trading day prior to announcement of the
execution of the Acquisition Agreement and Purchaser's intention to commence the
Offer, the closing sale price of the Shares on Nasdaq NMS was U.S.$10.6875 per
Share. On March 19, 1998, the last full trading day prior to the commencement of
the Offer, such closing sales price was U.S.$12.50 per Share. SHAREHOLDERS ARE
URGED TO OBTAIN A CURRENT MARKET QUOTATION FOR THE SHARES.
7. CERTAIN INFORMATION CONCERNING THE COMPANY
GENERAL. The Company is a British Columbia company with its principal
office located at 2255 B. Queen Street, East, Suite 828, Toronto, Ontario,
Canada M4E 1G3. The Company, through its subsidiaries, develops, manufactures
and markets medical diagnostic products and provides medical services for the
screening, diagnosis and monitoring of infectious diseases and other medical
conditions.
FINANCIAL INFORMATION. Set forth below is certain selected consolidated
financial information, with respect to the Company and its subsidiaries. More
comprehensive financial information is included in reports and other documents
filed by the Company with the Commission, and the following summary is qualified
in its entirety by reference to such reports and other documents and all of the
financial information (including any related notes) contained therein. Such
reports and other documents are available for inspection and copies thereof are
obtainable in the manner set forth below under "Available Information."
13
<PAGE>
INTERNATIONAL MUREX TECHNOLOGIES CORPORATION
SELECTED CONSOLIDATED FINANCIAL DATA
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------------
1997 1996 1995
------------ ------------ ------------
(IN THOUSANDS OF U.S. DOLLARS EXCEPT PER
SHARE AMOUNTS)
<S> <C> <C> <C>
STATEMENTS OF OPERATIONS DATA
Product sales............................................. $ 98,553 $ 99,881 $ 92,394
License fees.............................................. 7,579 970 --
------------ ------------ ------------
Total revenues............................................ 106,132 100,851 92,394
Costs and expenses:
Cost of products sold................................... 39,250 34,887 30,181
Research & development.................................. 7,487 6,369 7,426
General & administrative................................ 21,630 25,803 24,818
Sales & marketing....................................... 28,883 29,523 26,898
Royalty expense......................................... 5,625 (2,799) 8,365
Restructuring costs..................................... -- 2,100 --
All other expenses...................................... 104 1,542 (1,016)
------------ ------------ ------------
Total costs & expenses.................................... 102,979 97,425 96,272
Operating income (loss)................................... 3,153 3,426 (3,878)
Interest income........................................... 290 663 1,221
Interest expense.......................................... (1,422) (1,306) (167)
All other income (expense), net........................... 4,438 82 (3,304)
------------ ------------ ------------
Net income (loss) before tax.............................. $ 6,459 $ 2,865 $ (6,128)
Income tax expense (benefit).............................. (2,605) 1,016 482
Net income (loss)......................................... 9,064 1,849 (6,610)
------------ ------------ ------------
------------ ------------ ------------
Net income (loss) per common share
Basic................................................... $ 0.55 $ 0.11 $ (0.40)
Diluted................................................. $ 0.52 $ 0.11 $ (0.40)
Weighted average shares outstanding
Basic................................................... 16,484 16,215 16,381
Diluted................................................. 17,444 16,507 16,381
Cash dividends 0 0 0
</TABLE>
<TABLE>
<CAPTION>
AT DECEMBER 31,
----------------------------------------
1997 1996 1995
------------ ------------ ------------
(IN THOUSANDS OF U.S. DOLLARS)
<S> <C> <C> <C>
CONSOLIDATED BALANCE SHEET DATA
Total assets.............................................. $ 95,243 $ 95,113 $ 85,748
Long term debt............................................ 14,331 9,638 0
</TABLE>
AVAILABLE INFORMATION. The Company is registered under the Exchange Act,
and, accordingly, is subject to the informational filing requirements of the
Exchange Act. In accordance therewith the Company files periodic reports, proxy
statements and other information with the Commission under the Exchange Act
relating to its business, financial condition and other matters. The Company is
required to disclose in such proxy statements certain information, as of
particular dates, concerning the Company's directors and officers, their
remuneration, stock options granted to them, the principal holders of the
Company's securities and any material interest of such persons in transactions
with the Company. Such reports, proxy statements and other information may be
inspected at the Commission's office at 450 Fifth Street, N.W., Washington, D.C.
20549, and also should be available for inspection and copying at
14
<PAGE>
the regional offices of the Commission located at 500 West Madison Street, Suite
1400, Chicago, Illinois 60661-2511; and 7 World Trade Center, 13th Floor, New
York, New York 10048. Copies may be obtained by mail from the Public Reference
Section of the Commission, 450 Fifth Street, N.W., Washington, D.C. 20549, at
prescribed rates. The Commission also maintains a World Wide Website on the
Internet at http://www.sec.gov which site contains registration statements,
reports, proxy and information statements and other information regarding
registrants that file electronically with the Commission, including the Company.
In addition, such material should be available for inspection at the NASD, 1735
K Street, N.W., Washington, D.C. 20006.
8. CERTAIN INFORMATION CONCERNING PURCHASER AND PARENT
GENERAL. Purchaser, a British Columbia company and an indirect wholly owned
subsidiary of Parent, recently was organized for the purpose of effecting the
Offer and either the Compulsory Acquisition or the Amalgamation, and has not
carried on any activities except in connection with the Offer and either the
Compulsory Acquisition or the Amalgamation. The principal executive offices of
Purchaser are located at 100 Abbott Park Road, Abbott Park, Illinois 60064. All
the outstanding capital stock of Purchaser is owned by Parent.
Parent is an Illinois corporation with its principal offices located at 100
Abbott Park Road, Abbott Park, Illinois 60064. Parent's principal business is
the discovery, development, manufacture and sale of a broad and diversified line
of health care products and services. Parent is a public company whose stock is
traded on the New York Stock Exchange, Inc. ("NYSE").
Except as described in this Offer to Purchase, during the last five years,
none of Purchaser, Parent or, to the best knowledge of Purchaser or Parent, any
of the persons listed in Schedule I (i) has been convicted in a criminal
proceeding (excluding traffic violations and similar misdemeanors) or (ii) was a
party to a civil proceeding of a judicial or administrative body of competent
jurisdiction and as a result of such proceeding was or is subject to a judgment,
decree or final order enjoining future violations of, or prohibiting activities
subject to, federal or state securities laws or finding any violation of such
laws. The name, business address, present principal occupation or employment,
five-year employment history and citizenship of each director and executive
officer of Purchaser and Parent are set forth in Schedule I.
FINANCIAL INFORMATION. Set forth below is certain selected consolidated
financial information with respect to Parent and its subsidiaries as of its
fiscal years ended December 31, 1997, 1996 and 1995. More comprehensive
financial information is included in reports and in documents filed by Parent
with the Commission, and the following summary is qualified in its entirety by
reference to such reports and other documents and all of the financial
information (including any related notes) contained therein. Such reports and
other documents should be available for inspection and copies thereof should be
obtainable in the manner set forth below under "Available Information."
15
<PAGE>
ABBOTT LABORATORIES AND SUBSIDIARIES
SELECTED CONSOLIDATED FINANCIAL INFORMATION
<TABLE>
<CAPTION>
FISCAL YEARS ENDED DECEMBER 31,
----------------------------------------
1997 1996 1995
------------ ------------ ------------
(IN MILLIONS OF U.S. DOLLARS EXCEPT
PER SHARE AMOUNTS)
<S> <C> <C> <C>
STATEMENT OF EARNINGS DATA:
Net Sales................................................. $ 11,883.5 $ 11,013.5 $ 10,012.2
Net Earnings.............................................. 2,094.5 1,882.0 1,688.7
PER SHARE DATA:
Basic Earnings Per Common Share........................... $ 2.72 $ 2.41 $ 2.12
Diluted Earnings Per Common Share......................... 2.68 2.38 2.10
BALANCE SHEET DATA:
Working Capital........................................... $ 3.7 $ 137.2 $ 436.4
Total Assets.............................................. 12,061.1 11,125.6 9,412.6
Shareholders' Equity...................................... 4,998.7 4,820.2 4,396.8
Number of Common Shares Outstanding (in thousands)........ 764,094 774,449 787,307
</TABLE>
AVAILABLE INFORMATION. Parent is registered under the Exchange Act, and,
accordingly, is subject to the informational filing requirements of the Exchange
Act. In accordance therewith, Parent files periodic reports, proxy statements
and other information with the Commission under the Exchange Act relating to its
business, financial condition and other matters. Parent is required to disclose
in such proxy statements certain information, as of particular dates, concerning
Parent's directors and officers, their remuneration, stock options granted to
them, the principal holders of Parent's securities and any material interest of
such persons in transactions with Parent. Such reports, proxy statements and
other information may be inspected at the Commission's office at 450 Fifth
Street, N.W., Washington, D.C. 20549, and also should be available for
inspection and copying at the regional offices of the Commission located at 500
West Madison Street, Suite 1400, Chicago, Illinois 60661-2511; and 7 World Trade
Center, 13th Floor, New York, New York 10048. Copies may be obtained by mail
from the Public Reference Section of the Commission, 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates. The Commission also maintains a
World Wide Website on the Internet at http://www.sec.gov which site contains
registration statements, reports, proxy and information statements and other
information regarding registrants that file electronically with the Commission,
including the Parent. In addition, such material should be available for
inspection at the NYSE, 20 Broad Street, New York, New York 10005.
Except as described in this Offer to Purchase, (i) none of Purchaser or
Parent or, to the best knowledge of Purchaser or Parent, any of the persons
listed in Schedule I or any associate or majority owned subsidiary of any such
persons, beneficially owns or has a right to acquire any equity security of the
Company and (ii) none of Purchaser or Parent or, to the best knowledge of
Purchaser or Parent, any of the other persons referred to above, or any of the
respective directors, executive officers or subsidiaries of any of the
foregoing, has effected any transaction in any equity security of the Company
during either the past 60 days or the past six months.
Except as described in this Offer to Purchase, (i) none of Purchaser, Parent
or, to the best knowledge of Purchaser or Parent, any of the persons listed in
Schedule I has any contract, arrangement, understanding or relationship (whether
or not legally enforceable) with any other person with respect to any securities
of the Company, including, but not limited to, any contract, arrangement,
understanding or relationship concerning the transfer of the voting of any such
securities, joint ventures, loan or option arrangements, puts or calls,
guarantees of loans, guarantees against loss, or the giving or withholding of
proxies; (ii) there have been no contacts, negotiations or transactions between
Purchaser, Parent or any
16
<PAGE>
of their respective subsidiaries or, to the best knowledge of Purchaser or
Parent, any of the persons listed on Schedule I on the one hand, and the Company
or any of its directors, officers or affiliates, on the other hand, concerning a
merger, consolidation or acquisition, tender offer or other acquisition of
securities, election of directors, a sale or other transfer of a material amount
of assets or concerning any other transactions with the Company that are
required to be disclosed pursuant to the rules and regulations of the
Commission.
9. BACKGROUND OF THE OFFER
For the past several years, the Company has continuously reviewed possible
acquisitions of companies and/or product lines, strategic alliances through
joint ventures or investment, and license arrangements. In September 1995, the
Company retained TM Capital Corp. ("TM Capital") to assist in seeking such
business prospects and in obtaining long-term debt. One of the companies
contacted about these activities made a proposal to acquire the Company.
However, that proposal was deemed inadequate by the Company. As a result of
on-going consolidation and increasing competition for suitable acquisition
candidates and reasonably valued opportunities in the diagnostic industry, in
the fall of 1997, the Company chose to broaden its options to include the
partial sale or complete sale of the Company.
On November 17, 1997, the Company retained DLJ and subsequently terminated
the services of TM Capital.
During November 1997, DLJ prepared a Confidential Information Memorandum
describing the Company. In December 1997, DLJ began contacting companies based
upon a list compiled by DLJ and the Company of companies which might be
potentially interested in pursuing a strategic transaction with the Company. In
addition, the Company and DLJ received unsolicited inquiries with respect to a
transaction. Of the companies contacted or those which initiated contact, 26
companies executed confidentiality agreements and were provided with the
Confidential Information Memorandum. Parent participated in this process and
entered into a Confidentiality Agreement with the Company on February 22, 1998.
After having reviewed such information, seven parties, including Parent,
indicated that they had a preliminary interest with respect to an acquisition
transaction and desired to conduct a business, financial and legal review of the
Company. The Company and DLJ subsequently reviewed and discussed these
indications of preliminary interest. In late January 1998, the Company
established a data room where such parties could perform their due diligence. A
number of companies, including Parent, visited the data room.
On February 23 and 24, 1998, after visiting the data room, representatives
of Parent met with the Company's senior management in London, reviewed and
requested additional documents and visited the Company's facility in Dartford,
England, and also toured the Company's manufacturing facilities in Norcross,
Georgia and South Africa on February 24 and 27, 1998, respectively.
At the direction of the Company, DLJ issued guidelines for submitting
proposals. Such proposals were required to be submitted by March 3, 1998, with
some extensions granted. The Company subsequently received four proposals,
containing various differing terms and conditions.
On March 3, 1998, Parent wrote to the Company proposing a transaction
offering $11.00 per Share for all outstanding Shares on a cash basis, and
requested a reply by March 4, 1998.
On March 6, 1998, Mr. Cusick called an officer at Parent stating the amount
offered was inadequate, and rejected the proposal.
On March 9, 1998, an officer of Parent called Mr. Cusick and requested a
meeting to discuss a new proposal.
17
<PAGE>
On the evening of March 9, 1998, representatives of the Company and Parent
met to negotiate Parent's new proposal. After discussions, Parent proposed a
cash tender offer at $13.00 per Share for 100% of the Company's outstanding
Shares, contingent upon negotiation of satisfactory terms of an acquisition
agreement including negotiation of an agreement on major issues such as the
transaction fees and the negotiation and receipt of shareholder agreements. Such
amount was superior to the consideration offered in the other proposals received
by the Company.
On March 11, 1998, counsel to Parent provided the Company with an initial
draft of the Acquisition Agreement and the form of shareholder agreement.
Between March 11 and March 16, 1998, extensive negotiations were conducted as to
the details of the transaction and the draft agreements.
Based upon Parent's insistence that principal shareholders enter into
shareholders agreements, on March 12 and 13, 1998, the Company contacted certain
principal shareholders. The Company then reached agreement with five principal
shareholders who agreed to deliver shareholder agreements if the Company reached
agreement with Parent.
On March 13, 1998, the Board of Directors of Parent and Purchaser both held
telephonic meetings at which time both such Boards of Directors unanimously
approved the Acquisition Agreement and the transactions contemplated thereby.
On March 14, 1998, the Company and Parent reached an agreement on the
transaction fees, subject to agreement on the remaining open issues.
The Company's Board of Directors held telephonic meetings on March 13 and
March 14 to discuss the progress of the negotiations, the terms and structure of
the proposed transaction and the open issues. During the evening of March 15,
the Company's Board of Directors again met telephonically, at which time
management and counsel described the final draft agreements and the resolution
of the open issues. Representatives of DLJ explained the factors it had
considered in rendering a fairness opinion and then read the fairness opinion.
The Board of Directors then unanimously approved the Acquisition Agreement and
the transactions contemplated thereby.
Early the next morning, Parent, Purchaser and the Company entered into the
Acquisition Agreement, and Parent and the shareholders entered into shareholder
agreements. The parties announced the transaction later that morning pursuant to
a press release.
10. PURPOSE OF THE OFFER; THE ACQUISITION AGREEMENT
PURPOSE OF THE OFFER
The purpose of the Offer is to enable Purchaser to acquire any and all
outstanding Shares. If Purchaser purchases Shares pursuant to the Offer,
Purchaser intends to exercise its statutory right, if and to the extent
available, to acquire all of the Shares not purchased in the Offer by way of an
amalgamation, statutory arrangement or other transaction.
Section 255 of the BCCA permits an offeror to acquire shares not tendered to
an offer for all of the shares of a particular class of shares of a corporation
if, within four months after the date of the offer, the offer is accepted by the
holders of not less than 90% of the shares to which the offer relates, other
than shares held at the date of the offer by or on behalf of the offeror or its
affiliates or associates (as such terms are defined in the BCCA).
If, pursuant to the Offer, Purchaser acquires less than such number of
Shares or elects not to pursue a Compulsory Acquisition of Shares under the BCCA
or such provisions are not otherwise available, Purchaser is required under the
Amalgamation Agreement to attempt to effect the Amalgamation. The Amalgamation
will constitute a related party transaction and may constitute a going private
transaction under applicable Canadian law.
18
<PAGE>
THE ACQUISITION AGREEMENT
The following is a brief summary of certain provisions of the Acquisition
Agreement. This summary does not purport to be complete and is qualified in its
entirety by reference to the Acquisition Agreement which has been filed as an
exhibit to the Schedule 14D-1.
THE OFFER
Pursuant to the terms of the Acquisition Agreement, Purchaser was required
to commence the Offer no later than the fifth business day following the public
announcement of the terms of the Acquisition Agreement. The obligation of
Purchaser to accept for payment and pay for any Shares tendered pursuant to the
Offer is subject only to the Offer Conditions. Purchaser may increase the Offer
Price and may make any other changes in the terms and conditions of the Offer,
provided that Purchaser may only waive the Minimum Condition as long as
Purchaser purchases at least a majority of the Shares outstanding (assuming the
exercise of all outstanding options to purchase Shares which options are not
subject to binding agreements to cancel) and that, unless previously approved by
the Company in writing, no change may be made that decreases the price per Share
payable in the Offer, changes the form of consideration payable in the Offer,
reduces the maximum number of Shares that Subsidiary offers to purchase in the
Offer below a majority of the Shares outstanding (assuming the exercise of all
outstanding options to purchase Shares which options are not subject to binding
agreements to cancel), imposes conditions to the Offer in addition to the
conditions set forth in Section 13 or otherwise amends the terms of the Offer in
any way that would be materially adverse to holders of Shares.
Subject to the satisfaction of the conditions set forth in Section 13,
Purchaser has agreed to accept for payment and pay for Shares which have been
validly tendered and not withdrawn pursuant to the Offer as soon as it is
permitted to do so under applicable law. Notwithstanding the foregoing,
Purchaser (i) may extend the Offer to purchase Shares in excess of the Shares
required to satisfy the Minimum Condition up to the tenth business day following
the date on which all conditions to the Offer will first have been satisfied or
waived, provided that, by virtue of making any such extension, Purchaser will be
deemed to waive and thereafter shall not be entitled to assert any of the
conditions to the consummation of the Offer contained in subsections (b), (c),
(d) or (e) of Section 13, (ii) shall extend the Offer at least until 11:59 p.m.
New York City time on the sixth business day following the delivery to Parent of
a Notice of Superior Proposal (as defined below) and (iii) shall extend the
Offer at least until the expiration of the period set forth in subsections (d)
or (e) of Section 13 if a notice of breach has been delivered in accordance
therewith.
The Offer Price payable in the Offer shall be paid net to the seller in
cash, upon the terms and subject to the conditions of the Offer.
The Acquisition Agreement requires, as soon as practicable on the date of
commencement of the Offer, (a) Parent and Purchaser to file (i) with the
Commission a Tender Offer Statement on Schedule 14D-1 with respect to the Offer
and (ii) with the appropriate Canadian authorities any required filings with
respect to the Offer, which in the case of both (i) and (ii) will contain the
offer to purchase and form of the related letter of transmittal and (b) the
Company to file a combined Solicitation/Recommendation Statement on Schedule
14D-9 and any Director Circulars' required by Canadian law which it will mail to
shareholders promptly after the commencement of the Offer. Purchaser and the
Company also agreed to take all steps necessary to cause the offer to purchase
and form of the related letter of transmittal to be disseminated to holders of
Shares as and to the extent required by applicable U.S. and Canadian laws.
At the consummation of the Offer, the Company's Board of Directors will (i)
terminate the International Murex Technologies Corporation Amended and Restated
Employee Stock Purchase Plan ("ESPP") and (ii) notify all participants
thereunder of its termination.
19
<PAGE>
The Company represented in the Acquisition Agreement that the Company's
Board of Directors had made appropriate amendments to and determinations (the
"Rights Plan Amendments and Determinations") under the Company's Rights Plan
dated August 31, 1995 between the Company and The Bank of New York (the "Rights
Plan"), including without limitation: (i) an amendment to the definition of
"Acquiring Person" under the Rights Plan to exclude Parent, Purchaser and their
subsidiaries from that definition; (ii) an amendment to the definition of
"Separation Time" under the Rights Plan to provide that the Separation Time
shall not occur by virtue of the execution of the Acquisition Agreement or the
Major Shareholder Agreements (as defined below), the consummation of the
transactions contemplated or permitted thereunder or the acquisition or purchase
of Shares by Parent, Purchaser or their subsidiaries and a determination by the
Company's Board of Directors to the same effect; and (iii) a determination by
the Company's Board of Directors approving the acquisition of Shares by Parent,
Purchaser or their subsidiaries pursuant to this Agreement or the Major
Shareholder Agreements, or any other acquisition or purchase of Shares by
Parent, Purchaser or their subsidiaries.
BOARD REPRESENTATION
Promptly upon the purchase by Purchaser of Shares pursuant to the Offer and
from time to time thereafter, Purchaser will be entitled to designate a number
of directors on the Company's Board of Directors equal to the product of (i) the
total number of directors on the Company's Board of Directors and (ii)
Purchaser's percentage ownership of the outstanding Shares of the Company. The
Company will either increase the size of the Company's Board of Directors or
secure the resignation of the necessary number of directors to enable
Purchaser's designees to be elected to the Company's Board of Directors, and
will cause such designees to be elected to the Company's Board of Directors;
provided, however, that at all times prior to the Completion of the Acquisition
at least two persons who are directors of the Company as of March 13, 1998 (or
persons designated by them) ("Continuing Directors") shall remain directors of
the Company.
Following the election or appointment of Purchaser's designees, any
amendment to the Acquisition Agreement or the Articles of Association or the
Memorandum of Association, any termination of the Acquisition Agreement by the
Company, and any extension by the Company of the time for performance of
obligations or the waiver of any rights under the Acquisition Agreement will
require the concurrence of at least fifty percent of the Continuing Directors.
COMPANY STOCK OPTIONS
Unless Parent and the Company make the Option Election (as defined below),
the Company will, prior to completion of the Offer: (i) use its best efforts to
amend each outstanding stock option, warrant or other right to acquire Shares
("Company Options") or any plans with respect to Company Options to permit
vesting of unvested and exercise of Company Options contingent on consummation
of the Offer; (ii) declare all Company Options to be fully exercisable and
vested prior to the completion of the Offer and contingent on consummation of
the Offer; and (iii) use its best efforts to cause the holders of Company
Options to exercise their Company Options and tender the Shares so acquired in
the Offer.
Parent and the Company may agree, after consulting their respective counsel,
to implement the steps described in this paragraph (the "Option Election")
instead of the steps described in the preceding paragraph. If the parties make
the Option Election: (i) immediately prior to consummation of the Offer, the
Company will offer to pay to the holder of each Company Option, in exchange for
the agreement by such holder to cancel his, her or its Company Options, an
amount equal to (x) the difference between the Offer Price and the per Share
exercise price of such Company Option, multiplied by (y) the number of Shares
underlying such holder's Company Option; (ii) the Company will use its best
efforts to cause the holders of Company Options to accept the Company's offer
set forth above and enter into appropriate cancellation agreements; and (iii)
Parent will, immediately following consummation of the Offer, lend to (subject
to any of the Company's contractual restrictions and at the applicable federal
rate) or contribute to the capital of the Company cash in an amount equal to the
amount necessary to satisfy payment by the Company of the amounts required under
the Option Election.
20
<PAGE>
The Company, Parent and the Company's Board of Directors shall take whatever
actions are required such that, as of the Effective Time, any Company Options
not exercised or canceled pursuant to the preceding two paragraphs are converted
into a fully vested and exercisable right to acquire common stock of Parent in a
manner that is substantially consistent with the requirements applicable to
"issuing or assuming a stock option in a transaction to which section 424(a)
applies," as that phrase is defined in Section 424(a) of the Code; provided that
the Company Options (and any replacements) will not confer on the holders
thereof any rights to acquire securities of the Company. Parent will cooperate
in whatever actions are required for the Company's Board of Directors to
implement this paragraph.
THE ACQUISITION
The Acquisition Agreement provides for the completion of the acquisition of
the Company by Purchaser or Parent (the "Completion of the Acquisition") through
either (1) the Compulsory Acquisition if Purchaser has purchased at least 90% of
the outstanding Shares in the Offer to permit a Compulsory Acquisition or, if
not, (2) the Amalgamation of Purchaser with the Company following the Offer upon
the terms and subject to the conditions summarized below and set forth in the
Acquisition Agreement and in any other agreement required to effect the
Amalgamation.
The Acquisition will become effective (the "Effective Time") (i) in the case
of the Compulsory Acquisition, at such time as all outstanding Shares are owned,
directly or indirectly, by Purchaser or Parent, and (ii) in the case of the
Amalgamation, at the time at which a certificate of amalgamation is issued by
the British Columbia Registrar of Companies.
Purchaser must own 90% or more of the outstanding Shares to effect a
Compulsory Acquisition. Subject to the satisfaction or waiver of the conditions
set forth in "Conditions to the Completion of the Acquisition" below, if after
purchasing Shares in the Offer (and, if Purchaser chooses to do so, through open
market purchases for 30 days or less), Purchaser owns enough Shares to
effectuate a Compulsory Acquisition, Purchaser shall, as promptly as practicable
thereafter, effectuate a Compulsory Acquisition in which every shareholder of
the Company other than Purchaser surrenders his, her or its ownership of Shares
to Purchaser in exchange for the payment by Purchaser to each such shareholder
of the Offer Price, all in accordance with the provisions of Section 255 of the
BCCA. Purchaser will as promptly as practicable make such filings and take such
other actions as are necessary to implement the Compulsory Acquisition.
Following a Compulsory Acquisition, the Company would continue in its present
form.
Subject to the satisfaction or waiver of the conditions set forth in
"Conditions to the Completion of the Acquisition" below, if after purchasing
Shares in the Offer, Purchaser does not own enough Shares to effectuate a
Compulsory Acquisition (and has not acquired enough Shares within 30 days
through open market purchases if Purchaser has chosen to make such open market
purchases), the parties will as soon as practicable thereafter consummate the
Amalgamation as described in the next sentence and in any amalgamation agreement
entered into to effect the Amalgamation (the "Amalgamation Agreement"). At the
Effective Time of the Amalgamation: (i) Purchaser will amalgamate with the
Company; (ii) the separate existence of Purchaser and the Company will cease;
and (iii) Amalco will continue as the successor company to the business and the
undertakings theretofore undertaken by the Company and Purchaser.
In connection with an Amalgamation, the Company, acting through the
Company's Board of Directors, will, in accordance with applicable law as soon as
practicable following the consummation of the Offer:
(i) duly call, give notice of, convene and hold an annual or special
meeting of its shareholders (the "Shareholders' Meeting") for the purpose of
considering the Amalgamation;
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(ii) subject to the Company's Board of Directors' fiduciary obligations
under applicable law, include in the Proxy Statement for the Shareholders'
Meeting the recommendation of the Company's Board of Directors that
shareholders of the Company vote in favor of the Amalgamation and the
transactions contemplated by the Acquisition Agreement; and
(iii) use its reasonable best efforts (A) to obtain and furnish the
information required to be included by it in the Proxy Statement and, after
consultation with Parent, respond promptly to any comments made by the
Commission or the appropriate Canadian authorities with respect to the Proxy
Statement and any preliminary version thereof and cause the Proxy Statement
to be mailed to its shareholders at the earliest practicable time following
the consummation of the Offer and (B) to obtain the necessary approvals by
its shareholders of the Amalgamation.
Parent will, and will cause Purchaser to, cause all Shares beneficially
owned by them to be present and voting for the purpose of a quorum and to be
voted affirmatively in favor of the Amalgamation at any meeting or solicitation
of consents with respect thereto.
At the Effective Time, by virtue of the Amalgamation and without any action
on the part of Parent, Purchaser, the Company or the holders of any of the
following securities:
(i) Each Share outstanding immediately prior to the Effective Time (except
Shares subject to (b)) will be exchanged for one Preference Share, as
contemplated in the Amalgamation Agreement. In turn, each Preference Share will
be immediately redeemed by Amalco upon payment to each remaining holder of
Shares of the Offer Price for each Share.
(ii) Any Shares issued and outstanding immediately prior to the Effective
Time and owned directly or indirectly by Purchaser, if any, will be canceled and
retired, and no consideration will be delivered in exchange therefor.
(iii) Each common share of Purchaser outstanding immediately prior to the
Effective Time will be exchanged for an identical number of Amalco common
shares.
As soon as practicable after the Effective Time, Parent will cause The Bank
of New York (the "Exchange Agent") to mail to each person who was a holder of
record of Shares or Company Options at the Effective Time: (i) a letter of
transmittal (which will specify conditions on the exchange of Shares); and (ii)
instructions for use in effecting the surrender of Share certificates in
exchange for the aggregate Offer Price due each holder of Shares at the
Effective Time. Upon surrender of Share certificates for cancellation to the
Exchange Agent or to such other agent or agents as may be appointed by Parent,
together with such letter of transmittal, duly executed, and such other
documents as may be required by the Exchange Agent or such other agent, the
holder of such Share certificates will be entitled to receive in exchange
therefor the aggregate amount of the Offer Price due each holder of Shares at
the Effective Time and the Share certificates so surrendered will be canceled.
After the Effective Time, each outstanding Share certificate will, until
surrendered for exchange as described above, be deemed for all purposes to
evidence only the right to receive the aggregate Offer Price in respect of such
Share certificate.
Notwithstanding anything in the Acquisition Agreement to the contrary, a
shareholder of the Company who did not tender Shares pursuant to the Offer may
exercise the rights granted under the BCCA to apply to court in connection with
Purchaser's plan to acquire any outstanding Shares pursuant to the Compulsory
Acquisition. A shareholder of the Company who did not tender Shares pursuant to
the Offer may exercise rights of dissent in the manner set forth in Section 207
of the BCCA in connection with the Amalgamation. If, after the Effective Time,
such holder fails to perfect or withdraws or loses his, her or its right to
apply to court to dissent, as applicable, such Shares will be treated as if they
had been converted, as of the Effective Time, into a right to receive the Offer
Price without interest thereon. The Company will give Parent prompt notice of
any notices or demands received by the Company for
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appraisal of Shares, and, prior to the Effective Time, Parent will have the
right to participate in all negotiations and proceedings with respect to such
demands. Prior to the Effective Time, the Company shall not, except with the
prior written consent of Parent, make any payment with respect to, or settle or
offer to settle, any such demands.
REPRESENTATIONS AND WARRANTIES
The Acquisition Agreement contains various representations and warranties of
the Company, including representations by the Company as to: (i) organization,
qualification and similar corporate matters of the Company and its subsidiaries,
(ii) capitalization of the Company and its subsidiaries, (iii) the
authorization, execution, delivery, performance and enforceability of the
Acquisition Agreement, (iv) the non-contravention of the Acquisition Agreement
and related transactions with any provision of the Memorandum of Association or
Articles of Association, material contract, order, law or regulation to which
the Company or its subsidiaries is a party or by which it is bound or obligated,
(v) the filing of required Commission reports and the absence of untrue
statements of material facts or omissions of material facts in such reports,
(vi) the absence of changes or events which have had a material adverse effect
on the Company and the absence of certain derivative instruments that would
result in a material adverse effect on the Company, (vii) the absence of any
untrue statement of a material fact or omission of any material fact required to
be stated in any recommendation statement of the Company's Board of Directors or
document related to the Offer, (viii) the absence of payments to any
intermediary other than listed intermediaries of any finder's, professional or
other fee or commission, (ix) claims and litigation, (x) the filing of tax
returns and the payment of taxes, (xi) employee benefits matters, (xii)
compliance with laws, rules, statutes, orders, ordinances or regulations, and
material notes, bonds, mortgages, indentures, contracts, agreements, leases,
licenses, permits, franchise or other instruments or obligations of the Company
or any of its subsidiaries which would result in a material adverse effect,
(xiii) the absence of environmental claims and compliance with all environmental
laws and regulations, (xiv) possession of all necessary rights and licenses in
intellectual property, (xv) contracts, agreements, indentures, leases,
mortgages, licenses, plans, arrangements, understandings, commitments and other
instruments (the "Significant Agreements"), (xvi) possession of all necessary
insurance, (xvii) the absence of real property ownership and the possession and
enforceability of all real property leases, (xviii) labor matters, (xix) the
absence of notices, citations or decisions of governmental or regulatory bodies
and recalls or warning letters from the Food and Drug Administration or non-U.S.
counterparts with respect to any product produced, manufactured, marketed or
distributed by the Company, and possession of and compliance with all necessary
approvals, clearances, authorizations, licenses and registrations relating to
the such products and (xx) applicable voting requirements.
The Acquisition Agreement contains various customary representations and
warranties of Parent and Purchaser, including representations by Parent and
Purchaser as to: (i) organization, qualification and similar corporate matters
of Parent and Purchaser, (ii) the authorization, execution, delivery,
performance and enforceability of the Acquisition Agreement, (iii) the
non-contravention of the Acquisition Agreement and related transactions with any
provision of the Certificate of Incorporation or By-Laws of Parent, the
Memorandum of Association or Articles of Association of Purchaser, by-law,
material contract, order, law or regulation to which Parent or Purchaser is a
party or by which it is bound or obligated, (iv) the absence of untrue
statements of material facts or omissions of material facts in any documents
related to the Offer and in information provided to the Company in connection
with the Schedule 14D-1 and proxy statement, (v) the absence of prior activities
of Purchaser other than in connection with or as contemplated by the Acquisition
Agreement, (vi) the availability of all funds necessary to satisfy Purchaser's
obligations under the Acquisition Agreement and (vii) the lack of beneficial or
record ownership of any Shares by Parent or Purchaser immediately prior to
execution of the Acquisition Agreement.
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COVENANTS
CONDUCT OF BUSINESS OF THE COMPANY. From the date of the Acquisition
Agreement to the time Purchaser's designees are elected as directors of the
Company, the Company and its subsidiaries will each conduct its operations in
the ordinary course of business consistent with past practice, and the Company
and its subsidiaries will each use its reasonable best efforts to preserve its
business organization, to keep available the services of its officers and
employees and to maintain existing relationships with licensors, licensees,
suppliers, contractors, distributors, customers and others having business
relationships with it.
Accordingly, prior to the date Purchaser's designees are elected to the
Company's Board of Directors, neither the Company nor any of its subsidiaries
may, without the prior written consent of Purchaser, which consent will not be
unreasonably withheld or delayed, engage or agree to engage in an enumerated
list of transactions generally characterized as being outside the ordinary
course of business. Transactions requiring Purchaser's prior approval include
actions by the Company or its subsidiaries to: (i) amend its Articles of
Association or Memorandum of Association or increase or propose to increase the
number of directors; (ii) authorize for issuance, issue, sell, deliver or agree
to commit to issue, sell or deliver any stock of any class or any other
securities or equity equivalents (including, without limitation, stock
appreciation rights), except under the ESPP, the issuance of up to 16,816 Shares
pursuant to the Company's bonus plan or as required by option agreements and
option plans as in effect as of the date of the Acquisition Agreement, or amend
any of the terms of any such securities or agreements outstanding as of the date
of the Acquisition Agreement; (iii) split, combine or reclassify any shares of
its capital stock, declare, set aside or pay any dividend or other distribution
(whether in cash, stock, or property or any combination thereof) in respect of
its capital stock, or redeem, repurchase or otherwise acquire any of its
securities or any securities of its subsidiaries; (iv) incur any debt or issue
any debt securities or assume, guarantee or endorse the obligations of any other
person, make any loans, advances or capital contributions to, or investments in,
any other person (other than to wholly owned subsidiaries of the Company),
pledge or otherwise encumber shares of capital stock of the Company or any of
its subsidiaries or mortgage or pledge any of its assets or create any Lien
thereupon other than Permitted Liens (as defined in the Acquisition Agreement);
(v) enter into, adopt, amend or terminate any bonus, compensation, severance,
termination, or employee benefit arrangement not required by any such plan or
arrangement; (vi) acquire, sell, lease, license, encumber, transfer or dispose
of any assets of the Company and its subsidiaries; (vii) change any of the
accounting principles or practices used by it, except as may be required as a
result of a change in law or in generally accepted accounting principles; (viii)
acquire any corporation, partnership or other business organization or division
thereof, authorize any new capital expenditure in excess of U.S.$200,000 between
March 13, 1998 and March 31, 1998 and, thereafter, in excess of the amounts set
forth in the monthly capital budgets to be prepared by the Company and approved
by Parent in its reasonable discretion or settle any litigation; (ix) make any
material tax election or settle or compromise any material tax liability; (x)
pay, discharge or satisfy any claims, liabilities or obligations outside the
ordinary course or not in accordance with their terms, except where such action
would not result in a material adverse effect; (xi) terminate, modify, amend or
waive compliance with any material provision of, any of the Significant
Agreements, or fail to take any action necessary to preserve the material
benefits of any Significant Agreement to the Company or any of its subsidiaries;
(xii) enter into any agreement providing for the acceleration of payment or
performance or other consequence as a result of a change in control of the
Company; (xiii) enter into any agreement providing for any license (other than
trademark or service mark licenses under supply or distribution contracts
entered into in the ordinary course of business), sale, assignment or otherwise
transfer any patent rights or grant any covenant not to sue with respect to any
of its Intellectual Property; (xiv) enter into any commitments to professionals
outside the ordinary course of business or in excess of the amounts represented
and warranted; (xv) cancel or terminate any material
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insurance policies (other than in connection with acquiring substantially
equivalent replacement policies) or reduce the amount of coverage thereunder; or
(xvi) agree to take any action which would violate the covenants.
ACCESS TO INFORMATION. The Company will give Parent and Purchaser and their
representatives reasonable access to all necessary information. Parent and
Purchaser have agreed to be bound by the Confidentiality Agreement dated
February 22, 1998, described below.
REASONABLE BEST EFFORTS. Each of the parties will use its reasonable best
efforts to take all actions and do all things reasonably necessary to consummate
and make effective the transactions contemplated by the Acquisition Agreement.
PUBLIC ANNOUNCEMENTS. Parent and Purchaser, on the one hand, and the
Company, on the other hand, will consult with each other before issuing any
press release or otherwise making any public statements with respect to the
transactions contemplated by the Acquisition Agreement.
INDEMNIFICATION. For a period not less than six years from the Effective
Time, Parent will (i) indemnify and hold harmless the directors, officers,
employees and agents of the Company (the "Indemnified Parties") from and against
claims, losses or obligations arising out of events occurring prior to the
Effective Time and relating to their service as a director, officer, employee or
agent of the Company except to the extent an Indemnified Party has acted in bad
faith or in a manner he did not reasonably believe to be in or not opposed to
the best interests of the Company or, with respect to any criminal action or
proceeding, had reasonable cause to believe his conduct was unlawful and (ii)
cause the Company or Amalco, as the case may be, to maintain in effect the
provisions in its Articles of Association and Memorandum of Association
containing the provisions with respect to exculpation of director and officer
liability and indemnification set forth in the Articles of Association and
Memorandum of Association of the Company on the date of the Acquisition
Agreement.
In the event of any claim made against an Indemnified Party covered above,
unless Parent, the Company or Amalco has elected to defend that claim, Parent,
the Company or Amalco shall advance the reasonable fees and expenses of counsel
selected by that Indemnified Party (which counsel shall be reasonably
satisfactory to Parent and which counsel shall be the same for all Indemnified
Parties unless a conflict of interest between them requires more than one
counsel), upon receipt of a written undertaking by or on behalf of that
Indemnified Party to repay such amounts if it shall ultimately be determined
that Indemnified Party is not entitled to be indemnified as described here.
Parent will cause Amalco to use its reasonable best efforts to maintain in
effect for six years from the Effective Time, to the extent available, the
coverage provided by the current directors' and officers' liability insurance
policies maintained by the Company with respect to matters occurring prior to
the Effective Time; provided, however, that Amalco will not be required to incur
any annual premium in excess of 200% of the last annual aggregate premium paid
prior to the date of the Acquisition Agreement for all current directors' and
officers' liability insurance policies maintained by the Company.
NOTIFICATION OF CERTAIN MATTERS. The Company will give prompt notice to
Parent or Purchaser, and Parent or Purchaser will give prompt notice to the
Company, as the case may be, of (i) the occurrence, or non-occurrence of any
event which would be likely to cause any representation or warranty contained in
the Acquisition Agreement to be untrue or inaccurate and (ii) any failure of the
Company, Parent or Purchaser, as the case may be, to comply with or satisfy any
covenant, condition or agreement under the Acquisition Agreement.
TERMINATION OF STOCK PLANS. The Company's Board of Directors (or, if
appropriate, any committee thereof) will adopt such resolutions or take such
other actions as are required (i) to suspend the ESPP and employee contributions
thereto effective as of March 16, 1998, (ii) to terminate the ESPP as of the
date that Shares are purchased in the Offer and (iii) to ratify, for purposes of
Section 16(b) of the
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Exchange Act, the transactions described in this paragraph. If the date of the
consummation of the Offer occurs prior to the next Investment Date (as defined
in the ESPP), then the ESPP will refund the payroll deductions made by the ESPP
participants during the Offering Period (as defined in the ESPP) immediately
preceding that Investment Date to the participants. If the date of the
consummation of the Offer occurs on or after the Investment Date, then the
payroll deductions will be applied to make purchases of Shares as provided in
the ESPP.
Prior to the consummation of the Offer, the Company's Board of Directors
(or, if appropriate, any committee thereof) will adopt resolutions or take other
actions necessary to ensure that, following the Effective Time, no participant
in any stock, stock option, stock appreciation or other benefit plan of the
Company or any of its subsidiaries will have any right thereunder to acquire any
capital stock of Company or Amalco.
NO SOLICITATION. The Acquisition Agreement requires the Company immediately
to cease any existing discussions or negotiations with any third parties with
respect to any inquiry, proposal or offer for an amalgamation, merger,
consolidation, business combination, sale of substantial assets, sale of shares
of capital stock (including, without limitation, by way of a tender offer) or
similar transactions involving the Company or any of its subsidiaries (an
"Acquisition Proposal"). The Company will not, directly or indirectly, through
any officer, director, employee, representative or agent or any of its
subsidiaries, (i) solicit, initiate, continue or encourage an Acquisition
Proposal, (ii) solicit, initiate, continue or engage in negotiations or
discussions concerning, or provide any non-public information or data to any
person or entity relating to, any Acquisition Proposal, or (iii) agree to
approve or recommend any Acquisition Proposal; provided, that (A) if the
Company's Board of Directors determines, based on the written advice of its
independent financial advisors, that such Acquisition Proposal would, if
consummated, result in a transaction more favorable to the Company's
shareholders from a financial point of view than the transactions contemplated
by this Acquisition Agreement and the Company's Board of Directors determine in
good faith, based upon the written advice of independent legal counsel, that to
do so would be required for the discharge of its fiduciary obligations, the
Company may, after receiving an executed confidentiality agreement (with terms
no less favorable to the Company than those contained in the Confidentiality
Agreement entered into with Parent), furnish nonpublic information or data to,
or enter into discussions or negotiations with, any person in connection with an
unsolicited Acquisition Proposal or recommend an unsolicited Acquisition
Proposal to the shareholders of the Company or (B) the Company may comply with
Rule 14e-2 promulgated under the Exchange Act with regard to an Acquisition
Proposal.
If the Company's Board of Directors determine in good faith that any
Acquisition Proposal constitutes a Superior Proposal (as defined below), the
Company's Board of Directors will promptly give written notice, specifying the
identity of the other party and the structure and material terms of such
Superior Proposal (a "Notice of Superior Proposal"), to Parent. The Company's
Board of Directors may (subject to the following sentences of this paragraph and
compliance with the Termination paragraph below), to the extent the Company's
Board of Directors determines in good faith based upon written advice of
independent legal counsel that it is necessary in order to comply with its
fiduciary duties under applicable law, approve or recommend any such Superior
Proposal, approve or authorize the Company's entering into an agreement with
respect to such Superior Proposal, approve the solicitation of additional
takeover or other investment proposals or terminate the Acquisition Agreement,
in each case at any time after the fifth business day following delivery to
Parent of the Notice of Superior Proposal. The Company may take any of the
foregoing actions pursuant to the preceding sentence only if an Acquisition
Proposal that was a Superior Proposal at the time of delivery of a Notice of
Superior Proposal continues to be a Superior Proposal in light of any improved
transaction proposed by Parent prior to the expiration of the five business day
period specified in the preceding sentence. A "Superior Proposal" means any bona
fide proposal for an Acquisition Proposal that the Company's Board of Directors
determines in their good faith reasonable judgment, based on the written advice
of its financial advisors,
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to be made by a person with the financial ability to consummate such proposal
and to provide greater aggregate value to the Company and/or the Company's
shareholders than the transactions contemplated by the Acquisition Agreement or
otherwise proposed by Parent as contemplated in this paragraph.
The Company will advise Parent of all such nonpublic information delivered
to such person, and will notify Parent immediately (and in no event later than
24 hours) after receipt by the Company of any Acquisition Proposal or any
request for nonpublic information in connection with an Acquisition Proposal or
for access to the properties, books or records of the Company by any person or
entity that informs the Company that it is considering making, or has made, an
Acquisition Proposal.
Such notice will be made orally and in writing and shall indicate in
reasonable detail the identity of the offeror and the terms and conditions of
such proposal, inquiry or contract.
CHIRON LICENSE AGREEMENT. Immediately following the execution of the
Acquisition Agreement, the Company delivered notice to Chiron Corporation
("Chiron") and Johnson & Johnson/Ortho Diagnostics Systems, Inc. ("Ortho")
pursuant to Clause 27 of the Agreement dated August 27, 1996 among Chiron,
Ortho, and the Company (the "Chiron/Ortho Agreement") that a Change in Control
(as defined therein) had occurred. Chiron and Ortho have the option, to be
exercised in writing within 15 business days to purchase at fair value the HCV
immunoassay business of the Company.
Without the prior written consent of Parent, the Company will not amend,
waive, modify, supplement or otherwise alter any provision of the Chiron/Ortho
Agreement, nor shall the Company offer to enter into or enter into any contract,
agreement, understanding or other arrangement with any person respecting the
Chiron/Ortho Agreement or the subject matter thereof. Without the prior written
consent of Parent, under no circumstances shall the Company propose, negotiate
or agree to any "fair value" as that term is described in Clause 27 of the
Chiron/Ortho Agreement except, after consultation with Parent, as is otherwise
specifically required to comply with the Chiron/Ortho Agreement or required by
applicable law. The Company and its affiliates will receive and retain
respectively, in the Company and, as the case may be, its affiliates, any and
all proceeds of any sale of the HCV immunoassay business for fair value pursuant
to Clause 27 of the Chiron/Ortho Agreement. No exercise of the option contained
in Clause 27 of the Chiron/Ortho Agreement or the sale of HCV immunoassay
business resulting therefrom shall be deemed to be a breach of any
representation, warranty or covenant contained in the Acquisition Agreement, nor
shall any such exercise be deemed to cause any condition contained in the
Acquisition Agreement or the Offer to be unsatisfied.
LITIGATION BETWEEN PARENT AND THE COMPANY. Immediately after the execution
of the Acquisition Agreement, the parties will (i) cease to actively prosecute
the patent infringement litigation between the Company and Parent, pending in
the District Court for the Northern District of Georgia (No. 96-CV1676) (the
"Abbott Litigation") and (ii) ask the court in the Abbott Litigation to stay
that litigation. Promptly after the purchase by Purchaser of Shares pursuant to
the Offer, the Company and Parent will take all steps necessary to dismiss with
prejudice the Abbott Litigation.
RIGHTS PLAN. Unless the Acquisition Agreement and the letter agreements
dated March 13, 1998 (the "Major Shareholder Agreements") among Parent and
Edward J. DeBartolo, Jr., the Estate of Edward J. DeBartolo, the University of
Notre Dame, C. Robert Cusick and Michael Warren have terminated without the
purchase or acquisition by Parent or one of its subsidiaries of Shares pursuant
to one or both of those agreements, the Company will not amend or modify the
Rights Plan in a manner that would in any way nullify or conflict with the
resolutions and determinations related to the Rights Plan approved by the
Company's Board of Directors on March 15, 1998 and will not adopt any new
shareholder rights plan or agreement or similar agreement, plan or measure that
would nullify or conflict with the Rights Plan Amendments and Determinations,
have an adverse effect on Parent, Purchaser or any of their subsidiaries if
Parent, Purchaser or any of their subsidiaries purchase or acquire, or propose
to
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purchase or acquire, any securities of the Company or enter into any agreement
requiring or permitting the purchase or acquisition of any securities of the
Company.
POST-OPTION EXERCISE. If the Acquisition Agreement has been terminated and
Parent or any of its subsidiaries have purchased any Shares pursuant to any
Major Shareholder Agreement: (i) Parent and Purchaser will for six months
following such purchase use reasonable best efforts to consummate the
Amalgamation on essentially the same terms and conditions provided in the
Acquisition Agreement, except that certain of the conditions to closing will be
deemed to be waived; and (ii) if, despite the transaction contemplated by (i)
above, the Amalgamation is not effected, Parent has agreed that it and its
affiliates will not, for three years following the purchase of Shares pursuant
to any Major Shareholder Agreement, acquire beneficial ownership of any Shares
at less than the Offer Price (as adjusted for stock splits and similar events);
PROVIDED, HOWEVER, that the restrictions described in this paragraph will not
apply to the acquisition of less than 2% of the outstanding Shares by pension
plans or similar fiduciary entities of Parent.
CONDITIONS TO THE COMPLETION OF THE ACQUISITION
The obligations of the Company, Parent and Purchaser under the Acquisition
Agreement are subject to the satisfaction or, if appropriate, waiver of the
following conditions:
(i) SHAREHOLDER APPROVAL. If required by applicable law, the
Amalgamation will have been approved by the affirmative vote of the
shareholders of the Company by the requisite vote in accordance with
applicable law and any court approval required for the Amalgamation will
have been obtained.
(ii) NO PROHIBITION. No order, decree or ruling or other action
restraining, enjoining or otherwise prohibiting the Completion of the
Acquisition, which will have been issued or taken by any court or other
governmental body.
(iii) WAITING PERIOD. Any waiting period applicable to the
Completion of the Acquisition under applicable law will have terminated
or expired and the Canadian Office of Fair Trading has indicated, in
terms satisfactory to Parent and Purchaser, that it is not the intention
of the Canadian Secretary of State for Trade and Industry to refer the
proposed acquisition of the Company, or any matter arising therefrom
which directly affects Parent, Purchaser or the Company, to the Canadian
Monopolies and Mergers Commission.
(iv) PURCHASE OF SHARES. Purchaser will have purchased Shares
pursuant to the Offer.
The obligations of Parent and Purchaser under the Acquisition Agreement are
subject to the satisfaction or waiver by Parent at or prior to the Effective
Time of the following further conditions: (i) the Company will have performed in
all material respects its covenants, agreements and obligations up to the
Effective Time; and (ii) unless Purchaser has purchased Shares pursuant to the
Offer and except as otherwise contemplated by the Acquisition Agreement, the
representations and warranties of the Company contained in the Acquisition
Agreement which are qualified as to materiality will be true and correct and
those which are not so qualified will be true and correct in all material
respects, in each case, as of the date when made and at and as of the closing as
though newly made at and as of that time.
The obligations of the Company under the Acquisition Agreement are subject
to the satisfaction or waiver by the Company, at or prior to the Effective Time,
of the further condition that Parent and Purchaser will have performed in all
material respects their respective covenants, agreements and obligations under
the Acquisition Agreement up to the Effective Time.
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TERMINATION
The Acquisition Agreement provides that the Acquisition Agreement may be
terminated and the Offer and the Completion of the Acquisition may be abandoned
(i) at any time prior to the Consummation of the Offer by mutual written consent
of Parent, Purchaser and the Company; (ii) at any time prior to the Effective
Time by Parent or the Company to the extent that performance is prohibited,
enjoined or otherwise materially restrained by any final, non-appealable
judgment; (iii) at any time on or after August 31, 1998 if Purchaser has not
purchased any Shares pursuant to the Offer; PROVIDED, that the right to
terminate the Acquisition Agreement under this clause is not available to any
party whose failure to fulfill any obligation under the Acquisition Agreement
has been the cause of or resulted in such failure to purchase; (iv) by Parent
prior to the purchase by Purchaser of Shares pursuant to the Offer, if (a) there
has been a breach of any representation or warranty of the Company contained in
the Acquisition Agreement which would reasonably be expected to materially and
adversely affect the expected benefits for Parent of the transactions
contemplated under the Acquisition Agreement or prevent the consummation of the
Offer or the Completion of the Acquisition or (b) there has been a breach of any
covenant or agreement of the Company contained in the Acquisition Agreement
which would reasonably be expected to materially and adversely affect the
expected benefits for Parent of the transactions contemplated hereunder or
prevent the consummation of the Offer or the Completion of the Acquisition and
which, in the case of either (a) or (b) above, if curable, has not been cured
prior to the earlier of ten business days following notice of such breach; (v)
prior to the purchase of Shares pursuant to the Offer and no earlier than five
business days after the receipt by Parent of a Notice of Superior Proposal, if
the Superior Proposal described in such Notice of Superior Proposal continues to
be a Superior Proposal in light of any transaction proposed by Parent prior to
the expiration of the fifth business day after the receipt by Parent of such
Notice of Superior Proposal, by the Company if the Company's Board of Directors
determine in good faith, based upon the written advice of its independent
financial advisors, that such Acquisition Proposal would, if consummated, result
in a transaction more favorable to the Company's shareholders from a financial
point of view than the transactions contemplated by the Acquisition Agreement
and the Company's Board of Directors determines in good faith, based upon the
written advice of independent legal counsel, that such action is required for
the discharge of their fiduciary duties to shareholders under applicable law;
(vi) at any time prior to the Consummation of the Offer by Parent if the
Company's Board of Directors withdraws or modifies in a manner adverse to Parent
or Purchaser its approval of the Offer, the Acquisition Agreement, the
Completion of the Acquisition, its recommendation to the Company's shareholders;
or (vii) by the Company prior to the purchase by Purchaser of Shares pursuant to
the Offer, if there shall have been a breach of any representation or warranty
of Parent or Purchaser contained in the Acquisition Agreement which would
reasonably be expected to materially and adversely affect the expected benefits
for the Company's shareholders of the transactions contemplated under the
Acquisition Agreement or prevent the consummation of the Offer or the Completion
of the Acquisition or there has been a breach of any covenant or agreement of
Parent or Purchaser contained in the Acquisition Agreement which would
reasonably be expected to materially and adversely affect the expected benefits
for the Company's shareholders of the transactions contemplated hereunder or
prevent the consummation of the Offer or the Completion of the Acquisition and
which, in the case of either (a) and (b) above, if curable, has not been cured
prior to ten business days following notice of such breach.
If the Acquisition Agreement is terminated pursuant to (a) clause (iii) due
to a failure to satisfy the Minimum Condition at any time after any person has
made an Acquisition Proposal and, within twelve months of the date of such
termination, the Company enters into a definitive agreement relating to an
Acquisition Proposal at a price per Share that exceeds the Offer Price with any
person, (b) clauses (iv), (v) or (vi) above, the Company will pay Parent a
non-refundable fee of U.S.$10 million plus expenses of U.S.$2 million (except
for a termination under clause (iv) above, in which case only expenses of U.S.$2
million shall be payable).
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SURVIVAL OF REPRESENTATIONS AND WARRANTIES
The representations and warranties in the Acquisition Agreement shall not
survive beyond the consummation of the Offer. The covenants and agreements in
the Acquisition Agreement shall survive in accordance with their respective
terms, including, but not limited to the "Indemnification" paragraph above.
AMENDMENT; EXTENSION; WAIVER
Subject to approval by the Company's Board of Directors in the manner
described above under "Board Representation," the Acquisition Agreement may be
amended by the Company, Parent and Purchaser in a writing signed on behalf of
each of the parties; however, after approval of the Acquisition by the
shareholders of the Company (if required by applicable law), no amendment may
decrease the Offer Price or change the form thereof which adversely affects the
shareholders without approval of such shareholders.
Subject to approval by the Company's Board of Directors in the manner
described above under "Board Representation," at any time prior to the Effective
Time, the Company, on the one hand, and Parent and Purchaser, on the other hand,
may in writing (i) extend the time for the performance of any of the obligations
or other acts of the other party, (ii) waive any inaccuracies in the
representations and warranties of the other party or (iii) waive compliance by
the other party with any of the agreements or conditions contained in the
Acquisition Agreement.
EXPENSES
Subject to the payment of a fee by the Company to Purchaser if the
Acquisition Agreement is terminated under certain circumstances, each party
shall bear its own expenses and costs in connection with the Acquisition
Agreement and the transactions contemplated thereby.
GOVERNING LAW
The Acquisition Agreement is governed by and construed in accordance with
the laws of the State of Illinois, without regard to the principles of conflict
of laws thereof.
SHAREHOLDER AGREEMENTS
The following summary of the Major Shareholder Agreements and the
Shareholder Letters does not purport to be complete and is qualified in its
entirety to the complete text of such agreements, which are filed as exhibits to
the Schedule 14D-1 and incorporated herein by reference.
Pursuant to the Major Shareholder Agreements among Parent and Edward J.
DeBartolo, Jr., the Estate of Edward J. DeBartolo, the University of Notre Dame,
C. Robert Cusick and F. Michael P. Warren (each a "Major Shareholder"), the
Major Shareholders have agreed to tender all of the Shares held by them into the
Offer. In addition, the Major Shareholders have granted Parent an option (the
"Major Shareholder Options") to purchase all Shares held by them for the Offer
Price. The Major Shareholder Options are exercisable by Parent at any time until
the Acquisition Agreement is terminated, unless the Acquisition Agreement is
terminated (i) by Parent due to a material breach by the Company under the
Acquisition Agreement, (ii) by the Company in the event of a Superior Proposal
if the Company's directors determine that such action is required for the
discharge of their fiduciary duties to shareholders or (iii) by Parent if the
Company's Board of Directors shall have withdrawn or modified its recommendation
regarding the Offer, the Agreement, the Compulsory Acquisition or the
Amalgamation or the Company shall have entered into an agreement providing for
an Acquisition Proposal, in which case, the Major Shareholder Options may be
exercised by Parent until the later of (A) five business days following such
termination of the Acquisition Agreement or (B) two business days following the
receipt by Parent
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of any required governmental consents required in connection with the exercise
of the Major Shareholder Options.
Pursuant to the Major Shareholder Agreements, the Major Shareholders have
agreed not to sell, transfer or encumber any of the Shares held by them except
in the Offer or otherwise to Parent. In addition, the Major Shareholders have
agreed to vote, to the extent they are permitted to vote at law, all of the
Shares held by them (i) in the manner directed by Parent with respect to any
matters related to the acquisition of the Company by Parent and (ii) against any
other amalgamations, mergers, recapitalizations, business combinations, sales of
assets, liquidations or similar transactions involving the Company, or any other
matters which would be inconsistent with Parent's intended acquisition of the
Company. In furtherance of such voting agreement, the Major Shareholders have
granted Parent an irrevocable proxy to vote all of the Shares held by them in
accordance with the foregoing on any matters which may be presented to
shareholders of the Company with respect to any matters related to the
acquisition of the Company by Parent or any other amalgamations, mergers,
recapitalizations, business combinations, sales of assets, liquidations or
similar transactions involving the Company, or any other matters which would be
inconsistent with Parent's proposed acquisition of the Company.
As of the date of this Offer to Purchase, the Major Shareholders
collectively held 5,980,499 Shares, representing approximately 33.9% of the
Shares outstanding as of March 12, 1998.
Parent attempted to obtain commitments similar to the Major Shareholder
Agreements with Oracle Partners, L.P. and Citinvest Value Investment Portfolio
(VIP) Selector (the "Other Shareholders") but was unseccessful. Instead,
pursuant to letters dated March 13, 1998 (the "Shareholder Letters") from the
Other Shareholders, the Other Shareholders have indicated to the Company their
intention to tender all of the Shares held by them into the Offer. The
Shareholder Letters expire on the earlier of the termination of the Acquisition
Agreement or May 15, 1998. As of the date of this Offer to Purchase, the Other
Shareholders collectively held 1,935,617 Shares, representing approximately
11.5% of the Shares outstanding as of March 12, 1998.
AMENDMENT TO RIGHTS PLAN
The following summary of the Rights Plan amendment does not purport to be
complete and is qualified in its entirety by reference to the complete text
thereof, which is filed as an exhibit to the Schedule 14D-1 and incorporated
herein by reference.
Pursuant to the Acquisition Agreement, the Company amended the Rights Plan
as of March 13, 1998 to exclude Parent, Purchaser and their subsidiaries from
the definition of "Acquiring Person" therein and to clarify that the execution
of the Acquisition Agreement, the execution of the other agreements referenced
in the Acquisition Agreement, the consummation of the transactions contemplated
by the Acquisition Agreement or the acquisition of Shares by Parent, Purchaser
or their subsidiaries will not result in a "Separation Time" under the Rights
Plan. The effect of these amendments is among other things, to permit Purchaser
to acquire Shares pursuant to the Offer, the Completion of the Acquisition, the
Major Shareholder Options and otherwise without adverse consequences.
CONFIDENTIALITY AGREEMENT
The following summary of the Confidentiality Agreement does not purport to
be complete and is qualified in its entirety by reference to the complete text
of the Confidentiality Agreement, which is filed as an exhibit to Schedule 14D-1
and incorporated herein by reference.
On February 22, 1998, the Company and Parent entered into the
Confidentiality Agreement providing for the non-disclosure of confidential
information to be provided by the Company to Parent and by Parent to the
Company. The Confidentiality Agreement provided that if (1) Parent was afforded
a reasonable opportunity to complete a reasonable due diligence investigation of
the Company in connection with Parent making a proposal at or before 9:00 a.m.
Eastern Standard Time March 3, 1998 (an "Initial Proposal") respecting a
possible negotiated transaction; and (2) following such investigation, Parent
had a reasonable opportunity to formulate and make an Initial Proposal to the
Company respecting a possible negotiated transaction, then for a period of six
months from the date of the Confidentiality
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Agreement, without the prior written consent of the Company's current Board of
Directors or replacements designated by members of the Company's current Board
of Directors, neither Parent nor any of its directors, officers, employees,
partners, affiliates, agents, advisors or representatives will in any manner,
directly or indirectly, (a) effect or seek, offer or propose to effect, or cause
or participate in or in any way assist or act as advisor to any other person to
effect or seek, offer or propose to effect or participate in, (i) any
acquisition of any securities (or beneficial ownership thereof) or assets of the
Company or any of its subsidiaries; (ii) any tender or exchange offer or merger
or other business combination involving the Company or any of its subsidiaries;
(iii) any recapitalization, restructuring, liquidation, dissolution or other
extraordinary transaction with respect to the Company or any of its
subsidiaries; or (iv) any "solicitation" of "proxies" (as such terms are used in
the proxy rules of the Commission) or consents to vote any voting securities of
the Company, (b) otherwise act, alone or in concert with others, to seek to
control or influence the management, Board of Directors or policies of the
Company or (c) enter into any discussions or arrangements with any third party
with respect to any of the foregoing.
11. SOURCE AND AMOUNT OF FUNDS
The total amount of funds required by Purchaser and Parent to consummate the
Offer and the Acquisition and to pay related fees and expenses is estimated to
be approximately U.S.$237,000,000. Purchaser will obtain all funds required by
it from Parent. Parent will cause the required funds to be made available to
Purchaser and Parent expects to obtain all required funds from borrowings at
market interest rates. Such borrowings may be repaid by Parent from time to
time, in whole or in part, from internally generated funds or from the proceeds
of other borrowings.
12. CERTAIN EFFECTS OF THE OFFER
Following the consummation of the Offer, Purchaser will own at least a
majority of the outstanding Shares of the Company.
COMPULSORY ACQUISITION
If, within four months after the date hereof, the Offer has been accepted by
holders of not less than 90% of the Shares outstanding, other than Shares held
on the date hereof by, or by a nominee for, Parent, Purchaser or their
affiliates (as defined in the BCCA), Purchaser will, to the extent possible,
acquire the remainder of the Shares from those holders who have not accepted the
Offer on the same terms as Shares acquired under the Offer, pursuant to the
provisions of section 255 of the BCCA. If Purchaser exercises the foregoing
statutory right, Purchaser will, in accordance with section 255 of the BCCA,
give written notice (the "Notice") of such intention within five months after
the making of the Offer to each holder of Shares who did not accept the Offer (a
"Dissenting Offeree"). Upon the giving of Notice, Purchaser will be entitled and
bound to acquire the Shares held by the dissenting offerees at the same price
and on the same terms as offered in the Offer, unless the Supreme Court of
British Columbia (the "Court"), on application made by a Dissenting Offeree
within two months from the date of the giving of the Notice, orders otherwise.
On such application by a Dissenting Offeree to whom Notice was given, the Court
may fix the price and terms of payment for the Shares of the Dissenting Offeree
and make such consequential orders and give directions as it considers
appropriate.
Where Notice has been given by Purchaser and the Court has not, on an
application made by a Dissenting Offeree to whom Notice was given, ordered
otherwise, Purchaser shall, on the expiration of two months from the date on
which Notice was given, or if an application to the Court by a Dissenting
Offeree to whom Notice was given is then pending, then after that application
has been disposed of, send a copy of the Notice to the Company and pay or
transfer to the Company the amount representing the price payable by Purchaser
for the Shares which Purchaser is entitled to acquire, and the Company will
thereupon register Purchaser as a shareholder with respect to such Shares.
Any sum received by the Company in the manner set out above shall be paid
into a separate bank account and shall be held by the Company, or a trustee
approved by the Court, in trust for the persons entitled thereto.
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Subsections 255(9) and (10) of the BCCA provide, in effect, that if
Purchaser is entitled to deliver the Notice and has chosen to do so, dissenting
offerees may, by following the procedures specified therein, require Purchaser
to purchase their Shares at the same price and on the same terms as offered in
the Offer.
THE FOREGOING IS A SUMMARY ONLY. SEE SECTION 255 OF THE BCCA FOR THE FULL
TEXT OF THE RELEVANT STATUTORY PROVISIONS. SECTION 255 OF THE BCCA IS COMPLEX
AND MAY REQUIRE STRICT ADHERENCE TO NOTICE AND TIMING PROVISIONS, FAILING WHICH
SUCH RIGHTS MAY BE LOST OR ALTERED. SHAREHOLDERS WHO WISH TO BE BETTER INFORMED
ABOUT THOSE PROVISIONS OF THE BCCA SHOULD CONSULT THEIR LEGAL ADVISERS.
AMALGAMATION
If the Purchaser takes up and pays for Shares validly deposited under the
Offer and a Compulsory Acquisition is not possible at law, Purchaser will
attempt to effect the Amalgamation for the purposes of enabling Purchaser to
acquire all of the Shares not purchased under the Offer at the Offer Price.
Subject to any required court approval, if Purchaser acquires Shares pursuant to
the Offer which constitute not less than 75% of all of the issued and
outstanding Shares, Purchaser will have sufficient Shares to effect the
Amalgamation.
The Amalgamation would result in shareholders having the right to dissent in
respect thereof and demand payment of the fair value of their Shares. The
exercise of such right of dissent, if certain procedures are complied with by
the holder, could lead to a judicial determination of fair value required to be
paid to such dissenting shareholder for its Shares. The fair value so determined
could be more or less than the amount paid per Share pursuant to such
transaction or pursuant to the Offer.
Policy 9.1 of the Ontario Securities Commission ("OSC") and Policy Q-27 of
the Commission des Valeurs Mobiliers du Quebec ("CVMQ") may deem certain types
of subsequent acquisition transactions to be "going private transactions" if
such subsequent acquisition transaction would result in the interest of a holder
of Shares (the "Affected Securities") being terminated without the consent of
the holder and without the substitution therefor of an interest of equivalent
value in a participating security of the Company, a successor to the business of
the Company or a person who controls the Company or a person who controls a
successor to the business of the Company. The Amalgamation would be a going
private transaction.
Policy 9.1 and Policy Q-27 provide that, unless exempted, a corporation
proposing to carry out a going private transaction is required to prepare a
valuation of the Affected Securities (and any non-cash consideration being
offered therefor) and provide to the holders of the Affected Securities a
summary of such valuation. In connection therewith, Purchaser will be exempt
from the valuation requirements by virtue of the fact that the Offer Price was
arrived at through an arms-length transaction with the Company, and the Major
Shareholders. As of the date of this Offer to Purchase, the Major Shareholders
collectively held Shares representing approximately 33.9% of the Shares
outstanding as of March 12, 1998 and the Other Shareholders held Shares
representing approximately 11.5% of the Shares outstanding as of March 12, 1998.
Purchaser believes that no intervening event has occurred between the date of
that transaction and the date of this Offer to Purchase which could reasonably
be expected to increase the value of the Shares.
Policy 9.1 and Policy Q-27 would also require that, in addition to any other
required security holder approval, in order to complete the approval of a
majority of the votes cast by "minority" shareholders of the Affected Securities
(the "Minority Approval") must be obtained. In relation to the Offer and any
subsequent going private transaction, the "minority" shareholders would be,
absent exemptions or discretionary relief from the OSC and CVMQ, all holders of
Shares, other than (i) Purchaser, its directors and senior officers or any
associate or affiliate of Purchaser or its directors or senior officers or (ii)
any person or company acting jointly or in concert Purchaser or any of its
directors or senior officers in connection with the Offer or any subsequent
going private transaction. However, Policy 9.1 and Policy Q-27 provide that,
except as described above. Purchaser may treat Shares acquired pursuant to the
Offer as "minority" shares and to vote them, or to consider them voted, in favor
of such going private transaction if the consideration per security in the going
private transaction was disclosed at the time of the Offer. Under the
Acquisition Agreement, the consideration for each Share in the Amalgamation must
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be the Offer Price. Purchaser believes that the Shares acquired by Purchaser
pursuant to the Offer, to the extent permitted by applicable law, will be
counted as part of any minority approval required in connection with the
Amalgamation. If the Minimum Condition is satisfied, the Minority Approval would
be assured.
Promptly upon the purchase by Purchaser of Shares pursuant to the Offer and
from time to time thereafter, Purchaser will be entitled to designate a number
of directors on the Company's Board of Directors equal to the product of (i) the
total number of directors on the Company's Board of Directors and (ii)
Purchaser's percentage ownership of the outstanding Shares of the Company. The
Company will either increase the size of the Company's Board of Directors or
secure the resignation of the necessary number of directors to enable
Purchaser's designees to be elected to the Company's Board of Directors, and
will cause such designees to be elected to the Company's Board of Directors;
provided, however, that at all times prior to the Completion of the Acquisition
there will be at least two Continuing Directors. It is expected that C. Robert
Cusick and F. Michael P. Warren will be the Continuing Directors.
Following the election or appointment of Purchaser's designees, any
amendment of the Acquisition Agreement or the Articles of Association or the
Memorandum of Association, any termination of the Acquisition Agreement by the
Company, and any extension by the Company of the time for performance of
obligations or the waiver of any rights under the Acquisition Agreement will
require the concurrence of at least fifty percent of the Continuing Directors.
POSSIBLE EFFECTS OF THE OFFER ON THE MARKET FOR THE SHARES. The purchase of
Shares pursuant to the Offer will reduce the number of Shares that might
otherwise trade publicly and could adversely affect the liquidity and market
value of the remaining Shares held by the public. The purchase of Shares
pursuant to the Offer can also be expected to reduce the number of holders of
Shares. Purchaser cannot predict whether the reduction in the number of Shares
that might otherwise trade publicly could adversely affect the liquidity and
market value of the remaining Shares held by the public. The purchase of Shares
pursuant to the Offer can also be expected to reduce the number of holders of
Shares. Purchaser cannot predict whether the reduction in the number of Shares
that might otherwise trade publicly would have an adverse or beneficial effect
on the market price for or marketability of the Shares or whether it would cause
future market prices to be greater or less than the Offer Price therefor.
STOCK QUOTATION. Depending upon the number of Shares purchased pursuant to
the Offer, the Shares may no longer meet the listing requirements for the Nasdaq
NMS, which require that an issuer have at least 200,000 publicly held shares,
held by at least 400 shareholders or 300 shareholders of round lots, with a
market value of at least U.S.$1,000,000, and have net tangible assets of at
least U.S.$1,000,000, U.S.$2,000,000 or U.S.$4,000,000, depending on
profitability levels during the issuer's four most recent fiscal years. If these
standards are not met, the Shares might nevertheless continue to be publicly
quoted in an over-the-counter market but if the number of holders of the Shares
were to fall below 300, or if the number of publicly held Shares were to fall
below 100,000 or there were not at least two registered and active market makers
for the Shares, the NASD's rules provide that the Shares would no longer be
"qualified" for NASD reporting and the NASD would cease to provide any
quotations. Shares held directly or indirectly by directors, officers or
beneficial owners of more than 10% of the Shares are not considered as being
publicly held for this purpose. According to the Form 10-K, as of March 5, 1998,
there were approximately 1,799 holders of Shares and there were 16,742,372
Shares outstanding. If, as a result of the purchase of Shares pursuant to the
Offer or otherwise, the Shares no longer meet the listing requirements for
Nasdaq NMS or for any other over-the-counter market, the market for Shares could
be adversely affected.
In the event that the Shares no longer meet the requirements of the NASD for
continued inclusion in any tier of the Nasdaq, it is possible that the Shares
would continue to trade in an over-the-counter market and that price quotations
would be reported by other sources. The extent of the public market for the
Shares and the availability of such quotations would, however, depend upon the
number of holders of Shares remaining at such time, the interests in maintaining
a market in Shares on the part of securities firms, the possible termination of
registration of the Shares under the Exchange Act, as described below, and other
factors.
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EXCHANGE ACT REGISTRATION. The Shares are currently registered under the
Exchange Act. The purchase of the Shares pursuant to the Offer may result in the
Shares becoming eligible for deregistration under the Exchange Act. Registration
of the Shares may be terminated upon application by the Company to the
Commission if the Shares are not listed on a "national securities exchange" and
there are fewer than 300 record holders of Shares. Termination of registration
of the Shares under the Exchange Act would substantially reduce the information
required to be furnished by the Company to its stockholders and the Commission
and would make certain provisions of the Exchange Act, such as the short-swing
profit recovery provisions of Section 16(b) and the requirements of furnishing a
proxy statement in connection with stockholders' meetings pursuant to Section
14(a) or 14(c) and the related requirement of an annual report, no longer
applicable to the Company. If the Shares are no longer registered under the
Exchange Act, the requirements of Rule 13e-3 under the Exchange Act with respect
to "going private" transactions would no longer be applicable to the Company.
Furthermore, the ability of "affiliates" of the Company and persons holding
"restricted securities" of the Company to dispose of such securities pursuant to
Rule 144 promulgated under the Securities Act of 1933, as amended, may be
impaired or, with respect to certain persons, eliminated. If registration of the
Shares under the Exchange Act were terminated, the Shares would no longer be
"margin securities" or eligible for stock exchange listing or NASD reporting.
Purchaser believes that the purchase of the Shares pursuant to the Offer may
result in the Shares becoming eligible for deregistration under the Exchange
Act, and it would be the intention of Purchaser to cause the Company to make an
application for termination of registration of the Shares as soon as possible
after successful completion of the Offer if the Shares are then eligible for
such termination.
If registration of the Shares is not terminated prior to either the
Compulsory Acquisition or the Amalgamation, then the registration of the Shares
under the Exchange Act and the quotation of the Shares on the Nasdaq NMS will be
terminated following the consummation of either the Compulsory Acquisition or
the Amalgamation.
MARGIN REGULATIONS. The Shares are currently "margin securities" under the
regulations of the Board of Governors of the Federal Reserve System (the
"Federal Reserve Board"), which have the effect, among other things, of allowing
brokers to extend credit on the collateral of such Shares for the purpose of
buying, carrying or trading in securities ("Purpose Loans"). Depending upon
factors such as the number of record holders of the Shares and the number and
market value of publicly held Shares, following the purchase of Shares pursuant
to the Offer, the Shares might no longer constitute "margin securities" for
purposes of the Federal Reserve Board's margin regulations and, therefore, could
no longer be used as collateral for Purpose Loans made by brokers. In addition,
if registration of the Shares under the Exchange Act were terminated, the Shares
would no longer constitute "margin securities."
13. CERTAIN CONDITIONS OF THE OFFER
Notwithstanding any other provision of the Offer, the obligation of
Purchaser to accept for payment or pay for any Shares tendered pursuant to the
Offer shall be subject to (the following being referred to as the "Offer
Conditions") (i) the Minimum Condition, (ii) the expiration or termination of
any applicable waiting period under the HSR Act, the Canadian Competition Act,
the Investment Canada Act or any laws, regulations relating to the regulation of
monopolies or competition in Germany or any applicable requirements of the
United Kingdom Fair Trading Act , (iii) obtaining or satisfying, on terms
satisfactory to Parent in its reasonable discretion, of any other material
applicable approval, permit, authorization, consent or waiting period of any
domestic, foreign or supranational governmental, administrative or regulatory
agency located or having jurisdiction within the United States or any other
country or economic region in which the Company or any of its subsidiaries or
Parent or any of its subsidiaries, directly or indirectly, has material assets
or operations; PROVIDED, that prior to August 31, 1998, Purchaser shall not
terminate the Offer by reason of the nonsatisfaction of any of the conditions
set forth in clauses (ii) or (iii) above or in paragraphs (a) or (b) below if
such nonsatisfaction is curable and shall
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extend the Offer (it being understood that this proviso shall not prohibit
Purchaser from terminating the Offer or failing to extend the Offer by reason of
the nonsatisfaction of any other condition of the Offer), and (iv) to the
satisfaction or waiver of the following conditions:
(a) NO PROHIBITION. There shall not have been any action or
proceeding brought by any governmental authority before any court, or any
order or preliminary or permanent injunction entered in any action or
proceeding before any court or governmental, administrative or regulatory
authority or any statute, rule, regulation, legislation, interpretation
judgment or order proposed or sought, enacted, entered, enforced,
promulgated, amended, issued or deemed applicable to the Company or any
subsidiary or affiliate of Purchaser or the Company or the Offer, the
Completion of the Acquisition or the transactions contemplated by the
Acquisition Agreement, by any legislative body, court, government or
governmental, administrative or regulatory authority which could
reasonably be expected to have the effect of: (i) making illegal or
otherwise restraining or prohibiting the making of the Offer, the
acceptance for payment of, payment for, or ownership of, some of or all
the Shares by Parent or Purchaser, the consummation of any of the
transactions contemplated by the Acquisition Agreement or materially
delaying the Completion of the Acquisition; (ii) prohibiting or
materially limiting the ownership or operation by the Company or any of
its subsidiaries or by Parent or any of its subsidiaries, of all or any
material portion of the business or assets of the Company or any of its
subsidiaries or Parent or any of its subsidiaries, or compelling
Purchaser, Parent or any of Parent's subsidiaries to dispose of or hold
separate all or any material portion of the business or assets of the
Company or any of its subsidiaries or Parent or any of its subsidiaries,
as a result of the transactions contemplated by the Acquisition
Agreement; (iii) imposing or confirming material limitations on the
ability of Purchaser, Parent or any of Parent's subsidiaries effectively
to acquire or hold or to exercise full rights of ownership of Shares,
including, without limitation, the right to vote any Shares on all
matters properly presented to the shareholders of the Company, including,
without limitation, the adoption and approval of the Acquisition
Agreement and the Completion of the Acquisition or the right to vote any
shares of capital stock of any subsidiary of the Company; or (iv)
requiring divestiture by Parent or Purchaser, directly or indirectly, of
any Shares.
(b) OUTSIDE EVENTS. There shall not have occurred (i) any general
suspension of trading in, or limitation on prices for, securities on any
securities exchange or in the over-the-counter market in the United
States (ii) the declaration of a banking moratorium or any suspension of
payments in respect of banks in the United States (whether or not
mandatory) or (iii) any limitation (whether or not mandatory) by any
United States governmental authority or agency on the extension of credit
by banks or other financial institutions or (iv) in the case of any of
the situations described in clauses (i) through (iii) inclusive, existing
as of the date of the Acquisition Agreement or at the date hereof, a
material acceleration or worsening thereof.
(c) AWARENESS. There shall not have occurred or be occurring, or
Purchaser shall not have become aware of any event or condition that
would reasonably be expected to result in, a material adverse effect.
(d) PERFORMANCE. The Company shall have performed in all material
respects its covenants and agreements under the Acquisition Agreement.
(e) REPRESENTATIONS AND WARRANTIES TRUE. The representations and
warranties of the Company set forth in the Acquisition Agreement that are
qualified as to materiality shall be true and correct as of the Effective
Time or any of the representations and warranties of the Company set
forth in the Acquisition Agreement that are not so qualified shall be
true and correct in all material respects, in each case if such
representations and warranties were made at the time of such
determination (or, in the case of any representation and warranty made as
of
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a specified date, as of such date and if curable shall not have failed to
cure such failure to be true and correct within ten business days of
receipt of notice of such failure to be true and correct.
(f) NO TERMINATION. The Acquisition Agreement shall not have been
terminated in accordance with its terms.
(g) APPROVAL. The Company's Board of Directors shall not have
withdrawn or modified in a manner adverse to Purchaser its approval or
recommendation of the Offer, the Acquisition Agreement or the
Consummation of the Acquisition or shall not have recommended, or the
Company shall not have entered into an agreement providing for, a
Superior Proposal, or the Company's Board of Directors shall not have
resolved to do any of the foregoing.
(h) RIGHTS PLAN. The Company shall not have failed to adopt the
Rights Plan Amendments and Determinations and shall not amend or modify
its Rights Plan in a manner that would in any way nullify or conflict
with the Rights Plan Amendments and Determinations, and shall not adopt
any new shareholder rights plan or agreement or similar agreement, plan
or measure that would nullify or conflict with the Rights Plan Amendments
and Determinations or that would have an adverse effect on Parent,
Purchaser or any of their subsidiaries if Parent, Purchaser or any of
their subsidiaries purchase or acquire, or propose to purchase or
acquire, any securities of the Company or enter into any agreement
requiring or permitting the purchase or acquisition of any securities of
the Company.
Purchaser shall not be required to accept for payment or pay for any Shares
tendered pursuant to the Offer if any of the above conditions occurs, which, in
the reasonable judgment of Purchaser in any such case, and regardless of the
circumstances (including any action or omission by Purchaser) giving rise to any
such condition makes it inadvisable to proceed with such acceptance for payment
or payments for Shares.
The foregoing conditions are for the sole benefit of Purchaser and may be
asserted by Purchaser regardless of the circumstances giving rise to any such
condition or may be waived by Purchaser in whole or in part at any time or from
time to time in its sole discretion. The failure by Purchaser at any time to
exercise any of the foregoing rights shall not be deemed a waiver of any such
right, the waiver of any such right with respect to particular facts or
circumstances shall not be deemed a waiver with respect to any other facts or
circumstances, and each such right shall be deemed an ongoing right that may be
asserted at any time or from time to time.
14. DIVIDENDS AND DISTRIBUTIONS
If the Company should (a) split, combine or otherwise change the Shares or
its capitalization, (b) acquire currently outstanding Shares or otherwise cause
a reduction in the number of outstanding Shares or (c) issue or sell additional
Shares, shares of any other class of capital stock, other voting securities or
any securities convertible into, or rights, warrants or options, conditional or
otherwise, to acquire, any of the foregoing, then subject to the provisions of
Section 1 above, Purchaser, in its sole discretion, may make such adjustments as
it deems appropriate in the Offer Price and other terms of the Offer, including,
without limitation, the number or type of securities offered to be purchased.
If the Company should declare or pay any cash dividend on the Shares or make
other distributions on the Shares or issue with respect to the Shares, any
additional shares, shares of any other class of capital stock, other voting
securities or any securities convertible into, or rights, warrants or options,
conditional or otherwise, to acquire, any of the foregoing, payable or
distributable to shareholders of record on a date prior to the transfer of the
Shares purchased pursuant to the Offer to Purchaser or its nominee or transferee
on the Company's share transfer records, then, subject to the provisions of
Section 1 above, (a) the Offer Price may, in the sole discretion of Purchaser,
be reduced by the amount of
37
<PAGE>
any such cash dividend or cash distribution and (b) the whole of any such
noncash dividend, distribution or issuance to be received by the tendering
shareholders will (i) be received and held by the tendering shareholders for the
account of Purchaser and will be required to be promptly remitted and
transferred by each tendering shareholder to the Depositary for the account of
Purchaser, accompanied by appropriate documentation of transfer, or (ii) at the
direction of Purchaser, be exercised for the benefit of Purchaser, in which case
the proceeds of such exercise will promptly be remitted to Purchaser. Pending
such remittance and subject to applicable law, Purchaser will be entitled to all
rights and privileges as owner of any such noncash dividend, distribution,
issuance or proceeds and may withhold the entire Offer Price or deduct from the
Offer Price the amount or value thereof, as determined by Purchaser in its sole
discretion.
15. CERTAIN LEGAL MATTERS; REGULATORY APPROVALS
GENERAL
Except as described below, Purchaser is not aware of any governmental
license or regulatory permit that appears to be material to the business of the
Company and its subsidiaries, taken as a whole, that might be adversely affected
by Purchaser's acquisition of the Company's Shares as contemplated herein or of
any approval or other action by any governmental, administrative or regulatory
authority or agency, domestic or foreign, that would be required for the
acquisition or ownership of Shares by Purchaser as contemplated herein. Should
any such approval or other action be required, Purchaser and Parent currently
contemplate that such approval or other action will be sought. Except as
otherwise expressly described in this Section 15, Purchaser does not presently
intend to delay the acceptance for payment of or payment for Shares tendered
pursuant to the Offer pending the outcome of any such matter. Purchaser is
unable to predict whether it may determine that it is required to delay the
acceptance for payment of or payment for Shares tendered pursuant to the Offer
pending the outcome of any such matter. There can be no assurance that any such
approval or other action, if needed, would be obtained or would be obtained
without substantial conditions or that the failure to obtain any such approval
or other action might not result in consequences adverse to the Company's
business or that certain parts of the Company's business might not have to be
disposed of, any of which could cause Purchaser to decline to accept for payment
or pay for any Shares tendered. See Section 13 for certain conditions to the
Offer.
ANTITRUST
Under the HSR Act and the rules that have been promulgated thereunder by the
Federal Trade Commission (the "FTC"), certain acquisition transactions may not
be consummated unless certain information has been furnished to the Antitrust
Division of the Department of Justice (the "Antitrust Division") and the FTC and
certain waiting period requirements have been satisfied. The purchase of Shares
of the Company by Purchaser pursuant to the Offer is subject to such
requirements.
Under the provisions of the HSR Act applicable to the Offer, the purchase of
Shares under the Offer may be consummated following the expiration of a 15
calendar day waiting period following the filing by Parent of a Notification and
Report Form with respect to the Offer, unless Parent receives a request for
additional information or documentary material from the Antitrust Division or
the FTC or unless early termination of the waiting period is granted. Parent
expects that such filing will be made on or about March 23, 1998 and such
waiting period will expire at 11:59 p.m., New York City time, on or about April
7, 1998. If, within their initial 15 calendar day waiting period, either the
Antitrust Division or the FTC requests additional information or documentary
material from Parent concerning the Offer, the waiting period will be extended
and would expire at 11:59 p.m., New York City time, on the tenth calendar day
after the date of substantial compliance by Parent with such request. Only one
extension of the waiting period pursuant to a request for additional information
is authorized by the HSR Act. Thereafter, such waiting period may be extended
only by court order or with the consent of Parent. In practice, complying with a
38
<PAGE>
request for additional information or documentary material can take a
significant amount of time. In addition, if the Antitrust Division or the FTC
raises substantive issues in connection with a proposed transaction, the parties
frequently engage in negotiations with the relevant governmental agency
concerning possible means of addressing those issues and may agree to delay
consummation of the transaction while such negotiations continue.
A request is being made pursuant to the HSR Act for early termination of the
waiting period applicable to the Offer. There can be no assurance, however, that
the 15 calendar day HSR Act waiting period will be terminated early. Shares of
the Company will not be accepted for payment or paid for pursuant to the Offer
until the expiration or earlier termination of the applicable waiting period
under the HSR Act. See Section 13. Any extension of the waiting period will not
give rise to any withdrawal rights not otherwise provided for by applicable law.
See Section 4. If Purchaser's acquisition of Shares is delayed pursuant to a
request by the Antitrust Division or the FTC for additional information or
documentary material pursuant to the HSR Act, the Offer may, but need not, be
extended.
The FTC and the Antitrust Division frequently scrutinize the legality under
the antitrust laws of transactions such as the acquisition of Shares of the
Company by Purchaser pursuant to the Offer. At any time before or after
Purchaser's purchase of Shares pursuant to the Offer, the Antitrust Division or
the FTC could take such action under the antitrust laws as it deems necessary or
desirable in the public interest, including seeking to enjoin the purchase of
Shares pursuant to the Offer or the consummation of the Acquisition or seeking
the divestiture of Shares acquired by Purchaser or the divestiture of
substantial assets of Parent or its subsidiaries, or the Company or its
subsidiaries. Private parties may also bring legal action under the antitrust
laws under certain circumstances. Purchaser does not believe that the
consummation of the Offer will result in a violation of any applicable antitrust
laws. However, there can be no assurance that a challenge to the Offer on
antitrust grounds will not be made or, if such a challenge is made, of the
result thereof.
FOREIGN REGULATIONS
Under German laws and regulations relating to the regulation of monopolies
and competition, certain acquisition transactions may not be consummated in
Germany unless certain information has been furnished to the German Federal
Cartel Office (the "FCO") and certain waiting period requirements have been
satisfied without issuance by the FCO of an order to refrain. The purchase of
Shares of the Company by Purchaser pursuant to the Offer and the consummation of
the Acquisition may be subject to such requirements with regard to the German
subsidiaries of the Company and Parent. Parent expects to file such information
on or about March 27, 1998; and such waiting period will expire on or about
April 27, 1998 or may be extended by the FCO for a total of four months from the
date of the filing. Parent will request early termination of the waiting period,
although there can be no assurance of the outcome of such request. Purchaser
does not believe that the consummation of the Offer will become subject of an
order to refrain by the FCO under any applicable law or regulation in Germany
relating to the regulation of monopolies or competition. However, there can be
no assurance that a challenge to the Offer on such grounds will not be made or,
if such a challenge is made, of the result thereof.
16. FEES AND EXPENSES
Goldman, Sachs & Co. are acting as Dealer Managers in the United States and
Goldman Sachs Canada are acting as Dealer Managers in Canada in connection with
the Offer and Goldman, Sachs & Co. have provided certain financial advisory
services in connection with the acquisition of the Company. Parent has agreed to
pay Goldman, Sachs & Co. a transaction fee of $2,000,000 when the Offer and the
acquisition are consummated. Parent has also agreed to reimburse the Dealer
Managers for all reasonable out-of-pocket expenses incurred by the Dealer
Managers, including the reasonable fees and expenses of legal counsel, and to
indemnify the Dealer Managers against certain liabilities and expenses in
connection with its engagement, including certain liabilities under the federal
securities laws.
39
<PAGE>
Goldman, Sachs & Co. have from time to time, and continues to, render various
investment banking services to Parent and its affiliates, for which it is paid
customary fees.
Purchaser has retained Georgeson & Company Inc. to act as the Information
Agent, and to act as the Depositary, in connection with the Offer. The
Information Agent may contact holders of Shares by mail, telephone, telex,
telegraph and personal interview and may request brokers, dealers and other
nominee shareholders to forward the Offer materials to beneficial owners. Each
of the Information Agent and the Depositary will receive reasonable and
customary compensation for their respective services, will be reimbursed for
certain reasonable out-of-pocket expenses and will be indemnified against
certain liabilities and expenses in connection with the Offer, including certain
liabilities under the federal securities laws.
Except as set forth above, Purchaser will not pay any fees or commissions to
any broker or dealer or other person for soliciting tenders of Shares pursuant
to the Offer. Brokers, dealers, commercial banks and trust companies will, upon
request, be reimbursed by Purchaser for customary mailing and handling expenses
incurred by them in forwarding the Offer materials to their customers.
17. MISCELLANEOUS
The Offer is being made solely by this Offer to Purchase and the related
Letter of Transmittal and is being made to all holders of Shares. The Offer is
not being made to, nor will tenders be accepted from or on behalf of, holders of
Shares of the Company residing in any jurisdiction in which the making of the
Offer or the acceptance thereof would not be in compliance with the securities,
blue sky or other laws of such jurisdiction. However, Purchaser may, in its
discretion, take such action as it may deem necessary to make the Offer in any
jurisdiction and extend the Offer to holders of Shares in such jurisdiction. In
any jurisdiction where the securities, blue sky or other laws require the Offer
to be made by a licensed broker or dealer, the Offer will be deemed to be made
on behalf of Purchaser by the Dealer Managers or one or more registered brokers
or dealers that are licensed under the laws of such jurisdiction.
Parent and Purchaser have filed with the Commission the Schedule 14D-1
pursuant to Rule 14d-3 under the Exchange Act containing certain additional
information with respect to the Offer. Such Schedule and any amendments thereto,
including exhibits, may be examined and copies may be obtained from the
principal office of the Commission in the manner set forth in Section 7 (except
that they will not be available at the regional offices of the Commission).
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATION ON BEHALF OF PURCHASER OR PARENT NOT CONTAINED IN THIS OFFER TO
PURCHASE OR IN THE LETTER OF TRANSMITTAL AND, IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED.
40
<PAGE>
APPROVAL AND CERTIFICATE
The contents of the Offer to Purchase have been approved and the sending,
communication or delivery hereof to the shareholders of the Company has been
authorized by the Board of Directors of Purchaser. The foregoing contains no
untrue statement of a material fact and does not omit to state a material fact
that is required to be stated or that is necessary to make a statement not
misleading in light of the circumstances in which it was made. In addition, the
foregoing does not contain any misrepresentation likely to affect the value or
the market price of the Shares.
<TABLE>
<S> <C>
Dated: March 20, 1998 AAC Acquisition Ltd.,
an indirect wholly owned subsidiary of
Abbott Laboratories
/s/ MILES D. WHITE /s/ THOMAS C. FREYMAN
- ------------------------------ --------------------------------------
Miles D. White Thomas C. Freyman
PRESIDENT TREASURER
On behalf of the Board of Directors
/s/ JEFFREY L. SMITH /s/ PETER J. O'CALLAGHAN
- ------------------------------ --------------------------------------
Jeffrey L. Smith Peter J. O'Callaghan
DIRECTOR DIRECTOR
</TABLE>
41
<PAGE>
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS OF PARENT AND PURCHASER
A. DIRECTORS AND EXECUTIVE OFFICERS OF PARENT
The following table sets forth the name, present principal occupation or
employment and material occupation, positions, offices or employment for the
past five years of each director and executive officer of Parent. Unless
otherwise indicated below, the address of each director and officer is 100
Abbott Park Road, Abbott Park, Illinois 60064 and each such person is a citizen
of the United States.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OF EMPLOYMENT AND FIVE-YEAR
NAME AND BUSINESS ADDRESS EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
K. Frank Austen, M.D.................................... Dr. Austen has been a director since 1983. He is the
Theodore B. Bayles Professor of Medicine on the
faculty of Harvard Medical School. Dr. Austen also is
a director of Humana Inc.
Duane L. Burnham........................................ Mr. Burnham has served as a director of Parent since
1985, as Chairman of the Board of Parent since 1990
and as Chief Executive Officer of Parent since 1989.
He also is a director of NCR Corporation, Northern
Trust Corporation, Sara Lee Corporation and Evanston
Northwestern Healthcare.
H. Laurance Fuller...................................... Mr. Fuller has been a director since 1988. He has served
as Chairman and Chief Executive Officer of Amoco
Corporation ("Amoco") since 1991. From 1983 to 1995,
Mr. Fuller was the President of Amoco. He also is a
director of The Chase Manhattan Corporation and The
Chase Manhattan Bank, N.A. and Motorola, Inc.
Thomas R. Hodgson....................................... Mr. Hodgson has served as a director of Parent since
1985 and as President and Chief Operating Officer of
Parent since 1990. He joined Parent in 1972 and held
various operational positions with Parent.
David A. Jones.......................................... Mr. Jones has been a director since 1982. He is the
co-founder of Humana Inc. He is the chairman and
retired Chief Executive Officer of Humana Inc. He
served as both its Chairman and Chief Executive
Officer from its organization in 1961 until he retired
as Chief Executive Officer on December 1, 1997.
</TABLE>
I-1
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OF EMPLOYMENT AND FIVE-YEAR
NAME AND BUSINESS ADDRESS EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
The Rt. Hon. Lord Owen CH............................... Lord Owen has been a director since 1996. David Owen is
a British subject. He was a neurologist and Research
Fellow on the Medical Unit of St. Thomas' Hospital,
London, from 1965 through 1968. He served as a Member
of Parliament for Plymouth in the House of Commons
from 1966 until he retired in May 1992. In 1992, he
was created a Life Peer and was made a Member of the
House of Lords. In August 1992, the European Union, as
part of its peace seeking efforts in the Balkans,
appointed him Co-Chairman of the International
Conference on Former Yugoslavia. He stepped down from
that post in June 1995. Lord Owen was Secretary for
Foreign and Commonwealth Affairs from 1977 to 1979 and
Minister of Health from 1974 to 1976. He is currently
a director of Coats Viyella plc and Riceman Investment
Services (BVI) Limited and Executive Chairman of
Middlesex Holdings plc.
Boone Powell, Jr........................................ Mr. Powell has been a director since 1985. He has served
as President and Chief Executive Officer of Baylor
University Medical Center since 1980. Mr. Powell is
also President and Chief Executive Officer of Baylor
Health Care System and a director of Comerica Bank-
Texas, Physician Reliance Network and Healthway
Interactive.
Addison Barry Rand...................................... Mr. Rand has been a director since 1992. He has served
as Executive Vice President of Xerox Corporation since
1992. From 1986 to 1993, he was President of Xerox
Corporation's U.S. Marketing Group. Mr. Rand also
serves as a director of Ameritech Corporation and
Honeywell, Inc.
W. Ann Reynolds, Ph.D................................... Dr. Reynolds has been a director since 1980. In 1977,
Dr. Reynolds was appointed President of the University
of Alabama at Birmingham. She served as Chancellor of
The City University of New York from 1990 to 1997. Dr.
Reynolds also is a director of Humana, Inc., Maytag
Corporation and Owens-Corning Fiberglas Corp.
</TABLE>
I-2
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OF EMPLOYMENT AND FIVE-YEAR
NAME AND BUSINESS ADDRESS EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
William D. Smithburg.................................... Mr. Smithburg has been a director since 1982. He is
Retired Chairman, President and Chief Executive
Officer of The Quaker Oats Company. Mr. Smithburg
retired from Quaker Oats in October 1997. Mr.
Smithburg became President and Chief Executive Officer
at Quaker Oats in 1981, Chairman and Chief Executive
Officer in 1983 and also served as President from
November 1990 to January 1993 and from November 1995
until he retired. He is also a director of Northern
Trust Corporation, Corning Incorporated and Prime
Capital Corp.
John R. Walter.......................................... Mr. Walter has been a director since 1990. Mr. Walter
served as President and Chief Operating Officer of
AT&T Corporation from October 1996 until July 1997.
Prior to that time, Mr. Walter was Chairman and Chief
Executive Officer of R.R. Donnelley & Sons Company, a
printing company. Mr. Walter joined R.R. Donnelley &
Sons Company in 1969 and was named group President in
1985 and Executive Vice President in 1986. He was
elected President in 1987 and Chairman of the Board
and Chief Executive Officer in 1989. Mr. Walter was
elected to the Donnelley board in 1987 and served on
its board until October of 1996. Mr. Walter serves as
a director of Dayton Hudson Corporation, Deere &
Company, and LaSalle Partners.
William L. Weiss........................................ Mr. Weiss has been a director since 1984. He became
Chairman and Chief Executive Officer of Ameritech
Corporation in 1983 and served in that capacity until
January 1994 when he was named Chairman of the Board.
Since May 1994, Mr. Weiss has been Chairman Emeritus
of that Board. Mr. Weiss also is a director of The
Quaker Oats Company, Merrill Lynch & Co., Inc. and
Tenneco Corporation.
</TABLE>
I-3
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OF EMPLOYMENT AND FIVE-YEAR
NAME AND BUSINESS ADDRESS EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
Joy A. Amundson......................................... Ms. Amundson has served as Senior Vice President, Ross
Products of Parent since 1998. From 1995 to 1998, she
served as Senior Vice President, Chemical and
Agricultural Products. From 1994 to 1995, she served
as Vice President, Abbott HealthSystems. From 1993 to
1994, she served as Vice President, Corporate Hospital
Marketing.
Catherine V. Babington.................................. Ms. Babington has served as Vice President, Investor
Relations and Public Affairs of Parent since 1995.
From 1993 to 1995, she served as Director, Corporate
Communications.
Thomas D. Brown......................................... Mr. Brown has served as Senior Vice President,
Diagnostic Operations of Parent since 1998. From 1993
to 1998, he served as Vice President, Diagnostic
Commercial Operations. In 1993, he served as
Divisional Vice President, Diagnostic Commercial
Operations.
Gary R. Byers........................................... Mr. Byers has served as Vice President, Internal Audit
of Parent since 1993. In 1993, he served as Divisional
Vice President, Corporate Auditing.
Paul N. Clark........................................... Mr. Clark has served as Executive Vice President of
Parent since 1998. From 1993 to 1998, he served as
Senior Vice President, Pharmaceutical Operations.
Gary P. Coughlan........................................ Mr. Coughlan has served as Senior Vice President,
Finance and Chief Financial Officer of Parent since
1993.
Jose M. de Lasa......................................... Mr. de Lasa has served as Senior Vice President,
Secretary and General Counsel of Parent since 1994. In
1994, he served as Vice President, Secretary and
Associate General Counsel, Bristol-Myers Squibb
Company. From 1993 to 1994, he served as Vice
President and Associate General Counsel, Bristol-Myers
Squibb Company.
</TABLE>
I-4
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OF EMPLOYMENT AND FIVE-YEAR
NAME AND BUSINESS ADDRESS EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
William G. Dempsey...................................... Mr. Dempsey has served as Senior Vice President,
Chemical and Agricultural Products of Parent since
1998. From 1996 to 1998, he served as Vice President,
Hospital Products Business Sector. From 1995 to 1996,
he served as Divisional Vice President, Hospital
Products Business Sector Sales. From 1993 to 1995, he
served as Divisional Vice President and General
Manager, Abbott Critical Care Systems.
Kenneth W. Farmer....................................... Mr. Farmer has served as Vice President, Management
Information Services and Administration of Parent
since 1993.
Thomas C. Freyman....................................... Mr. Freyman has served as Vice President and Treasurer
of Parent since 1993.
Richard A. Gonzalez..................................... Mr. Gonzalez has served as Senior Vice President,
Hospital Products of Parent since 1998. From 1995 to
1998, he served as Vice President, Abbott
HealthSystems. From 1993 to 1995, he served as
Divisional Vice President and General Manager, U.S.
and Canada Diagnostics.
Arthur J. Higgins....................................... Mr. Higgins has served as Senior Vice President,
Pharmaceutical Operations of Parent since 1998. From
1996 to 1998, he served as Vice President, Pacific,
Asia, and Africa Operations. From 1995 to 1996, he
served as Divisional Vice President, Pacific, Asia,
and Africa Operations. From 1994 to 1995, he served as
Divisional Vice President, Commercial Operations,
Abbott International Division. From 1993 to 1994, he
served as Regional Director, Europe, Africa, and
Middle East. Mr. Higgins is a British subject.
John G. Kringel......................................... Mr. Kringel has served as Senior Vice President of
Parent since 1998. From 1993 to 1998, he served as
Senior Vice President, Hospital Products.
John F. Lussen.......................................... Mr. Lussen has served as Vice President, Taxes of Parent
since 1993.
Thomas M. McNally....................................... Mr. McNally has served as Senior Vice President of
Parent since 1998. From 1993 to 1998, he served as
Senior Vice President, Ross Products. In 1993, he
served as Senior Vice President, Chemical and
Agricultural Products.
</TABLE>
I-5
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OF EMPLOYMENT AND FIVE-YEAR
NAME AND BUSINESS ADDRESS EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
Theodore A. Olson....................................... Mr. Olson has served as Vice President and Controller of
Parent since 1993.
Robert L. Parkinson, Jr................................. Mr. Parkinson has served as Executive Vice President of
Parent since 1998. From 1995 to 1998, he served as
Senior Vice President, International Operations. From
1993 to 1995, he served as Senior Vice President,
Chemical and Agricultural Products. In 1993, he served
as Vice President, European Operations.
Marcia A. Thomas........................................ Ms. Thomas has served as Vice President, Quality
Assurance and Regulatory Affairs of Parent since 1996.
From 1995 to 1996, she served as Divisional Vice
President, Quality Assurance and Regulatory Affairs,
Diagnostics Division. From 1993 to 1995, she served as
Divisional Vice President and General Manager,
Infectious Diseases Diagnostics.
Ellen M. Walvoord....................................... Ms. Walvoord has served as Senior Vice President, Human
Resources of Parent since 1995. From 1993 to 1995, she
served as Vice President, Investor Relations and
Public Affairs.
H. Thomas Watkins....................................... Mr. Watkins has served as Vice President, Abbott
HealthSystems of Parent since 1998. From 1996 to 1998,
he served as Vice President, Diagnostics Operations,
Asia and Pacific. From 1994 to 1996, he served as
Divisional Vice President and General Manager, Asia
and Pacific Diagnostics. In 1993, he served as
Divisional Vice President and Sector General Manager,
Diagnostics Division.
Steven J. Weger, Jr..................................... Mr. Weger has served as Vice President, Corporate
Planning and Development of Parent since 1996. From
1994 to 1996, he served as Divisional Vice President,
Strategic Planning and Technology Assessment,
Diagnostics Division. In 1993, he served as Director,
Strategic Planning, Diagnostics Division.
</TABLE>
I-6
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OF EMPLOYMENT AND FIVE-YEAR
NAME AND BUSINESS ADDRESS EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
Josef Wendler........................................... Mr. Wendler has served as Senior Vice President,
International Operations of Parent since 1998. From
1995 to 1998, he served as Vice President, European
Operations. From 1993 to 1995, he served as Vice
President, Pacific, Asia, and Africa Operations. In
1993, he served as Divisional Vice President, Pacific,
Asia, and Africa. Mr. Wendler is a German citizen.
Miles D. White.......................................... Mr. White has served as Executive Vice President of
Parent since 1998. From 1994 to 1998, he served as
Senior Vice President, Diagnostic Operations. From
1993 to 1994, he served as Vice President, Diagnostic
Systems and Operations. In 1993, he served as
Divisional Vice President and General Manager,
Diagnostic Systems and Operations.
Lance B. Wyatt.......................................... Mr. Wyatt has served as Vice President, Corporate
Engineering of Parent since 1995. From 1993 to 1995,
he served as Divisional Vice President, Quality
Assurance and Regulatory Affairs, Pharmaceutical
Division.
</TABLE>
I-7
<PAGE>
B. DIRECTORS AND EXECUTIVE OFFICERS OF PURCHASER
The following table sets forth the name, business address, present principal
occupation or employment and material occupations, positions, offices or
employment for the past five years of each director and executive officer of
Purchaser. Unless otherwise indicated below, the address of each director and
officer is: 100 Abbott Park Road, Abbott Park, Illinois 60064 and each such
person is a citizen of the United States.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OF EMPLOYMENT AND FIVE-YEAR
NAME AND BUSINESS ADDRESS EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
Miles D. White President and Director. Mr. White has served as
Executive Vice President of Parent since 1998. From
1994 to 1998, he served as the Senior Vice President,
Diagnostic Operations. From 1993 to 1994, Mr. White
was Vice President, Diagnostic Systems and Operations
after having served as Divisional Vice President and
General Manager, Diagnostic Systems and Operations in
1993.
Thomas D. Brown Vice President. Mr. Brown was named Senior Vice
President, Diagnostic Operations of Parent in 1998,
after having served as Vice President Diagnostic
Commercial Operations from 1993 to 1998. In 1993, Mr.
Brown served as Divisional Vice President, Diagnostic
Commercial Operations.
Gary P. Coughlan Vice President. Mr. Coughlan has served as Senior Vice
President, Finance and Chief Financial Officer of
Parent since 1993.
John F. Lussen Vice President, Taxes. Mr. Lussen has served as Vice
President, Taxes of Parent since 1993.
Thomas C. Freyman Treasurer. Mr. Freyman has served as Vice President and
Treasurer of Parent since 1993.
Charles M. Brock Secretary. Mr. Brock has served as Divisional Vice
President, Associate General Counsel, International
Legal Operations and Assistant Secretary of Parent
since 1993.
Honey Lynn Goldberg Assistant Secretary. Ms. Goldberg has served as
Divisional Vice President, Domestic Legal Operations
and Assistant Secretary of Parent since 1995. Ms.
Goldberg served as Division Counsel, Domestic Legal
Operations of Parent from 1993 to 1995.
</TABLE>
I-8
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OF EMPLOYMENT AND FIVE-YEAR
NAME AND BUSINESS ADDRESS EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
Jefferey L. Smith Director. Mr. Smith has been the General Manager of the
Diagnostics Division of Abbott Laboratories Limited
since September 1997. Mr. Smith was the Director, Ross
from September 1994 to September 1997. He was also the
Business Unit Manager, Infant Nutrition from November
1991 to September 1994. Mr. Smith is a Canadian
citizen. Mr. Smith's business address is 7115
Millcreek Drive, Second Floor, Mississauga, Ontario
L5N3R3.
Peter J. O'Callaghan Director. Mr. O'Callaghan has been a partner at the law
firm Blake, Cassels & Graydon since July 1995. Mr.
O'Callaghan was also a partner at the law firm Bull
Housser & Tupper from 1989 to 1995. He is a Canadian
citizen and a British Columbia resident. Mr.
O'Callaghan's business address is 595 Burrard Street,
P.O. Box 49314, Vancouver, British Columbia V7X1L3.
</TABLE>
I-9
<PAGE>
THE DEPOSITARY FOR THE OFFER IS:
THE BANK OF NEW YORK
<TABLE>
<S> <C> <C>
By Mail: By Facsimile Transmission: By Hand or Overnight Courier:
Tender & Exchange Department (for Eligible Institutions Only) Tender & Exchange
P.O. Box 11248 (212) 815-6213 Department
Church Street Station 101 Barclay Street
New York, New York 10286-1248 Receive & Deliver Window
For Information Telephone: New York, New York 10286
(800) 507-9357
</TABLE>
Questions and requests for assistance may be directed to the Information Agent
or the Dealer Managers at their respective addresses and telephone numbers
listed below. Additional copies of this Offer to Purchase, the Letter of
Transmittal and other tender offer materials may be obtained from the
Information Agent as set forth below and will be furnished promptly at
Purchaser's expense. You may also contact the Dealer Managers or your broker,
dealer, commercial bank, trust company or other nominee for assistance
concerning the Offer.
THE INFORMATION AGENT FOR THE OFFER IS:
[LOGO]
Wall Street Plaza
New York, New York 10005
Banks and Brokers call collect (212) 440-9800
CALL TOLL FREE: 1-800-223-2064
THE DEALER MANAGERS FOR THE OFFER ARE:
<TABLE>
<S> <C>
IN THE UNITED STATES: IN CANADA:
GOLDMAN, SACHS & CO. GOLDMAN SACHS CANADA
85 Broad Street 150 King Street West
New York, New York 10004 Toronto, Ontario M5H 109
(212) 902-1000 (collect) (416) 343-8900
(800) 323-5678 (toll free)
</TABLE>
