<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
SCHEDULE 14D-1
(AMENDMENT NO. 2)
TENDER OFFER STATEMENT PURSUANT TO SECTION 14(D)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
AND
SCHEDULE 13D*
(AMENDMENT NO. 12)
UNDER THE SECURITIES EXCHANGE ACT OF 1934
----------------
RHONE-POULENC RORER INC.
(Name of Subject Company)
----------------
RHONE-POULENC S.A.
(Bidder)
----------------
COMMON STOCK, WITHOUT PAR VALUE
(Title of Class of Securities)
----------------
76242T 10 4
(CUSIP Number of Class of Securities)
----------------
YVES BRISSY
RHONE-POULENC S.A.
25, QUAI PAUL DOUMER
92408 COURBEVOIE CEDEX, FRANCE
011-331-47-68-12-34
(Name, Address and Telephone Number of Persons Authorized to Receive Notices
and Communications on Behalf of Bidder)
----------------
With Copies to:
HUBERTUS V. SULKOWSKI, ESQ. CREIGHTON O'M. CONDON, ESQ.
SHEARMAN & STERLING SHEARMAN & STERLING
114, AVENUE DES CHAMPS-ELYSEES 599 LEXINGTON AVENUE
75008 PARIS, FRANCE NEW YORK, NEW YORK
011-331-53-89-70-00 (212) 848-4000
SEPTEMBER 10, 1997
- -------------------------------------------------------------------------------
*This Statement also constitutes Amendment No. 12 to the Statement on Schedule
13D of Rhone-Poulenc S.A. with respect to the Common Stock, without par value,
of Rhone-Poulenc Rorer Inc. which may be deemed to be beneficially owned by
Rhone-Poulenc S.A.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
This Amendment No. 2 to the Tender Offer Statement on Schedule 14D-1 and
Amendment No. 12 to the Statement on Schedule 13D (this "Amendment") filed by
Rhone-Poulenc S.A., a societe anonyme organized under the laws of the Republic
of France ("Purchaser") relates to the offer by Purchaser to purchase all of
the issued and outstanding shares (the "Shares") of common stock, without par
value, of Rhone-Poulenc Rorer Inc., a Pennsylvania corporation, at a price of
$97 per Share, net to the seller in cash, upon the terms and subject to the
conditions set forth in the Offer to Purchase dated August 22, 1997 (the
"Offer to Purchase") and in the related Letter of Transmittal (which together
constitute the "Offer").
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
Item 11 is hereby amended and supplemented by adding the following Exhibits:
(a)(12) Communications Package to Participants in the Company's 401(k)
Savings Plan.
(a)(13) Communications Package to Participants in the Company's Centeon
Plan.
(a)(14) Letter to Participants in the Company's Divided Reinvestment Plan.
(a)(15) Communications Package to Non-Employee Holders of Company Stock
Options.
(a)(16) Communications Package to Holders of Company Stock Options in the
United Kingdom.
2
<PAGE>
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.
September 10, 1997
RHONE-POULENC S.A.
By: /s/ Yves Brissy
Name: Yves Brissy
Title: General Counsel
3
<PAGE>
EXHIBIT INDEX
EXHIBIT
NO. DESCRIPTION
------- -----------
(a)(12)Communications Package to Participants in the Company's 401(k) Savings
Plan.
(a)(13)Communications Package to Participants in the Company's Centeon Plan.
(a)(14)Letter to Participants in the Company's Divided Reinvestment Plan.
(a)(15)Communications Package to Non-Employee Holders of Company Stock
Options.
(a)(16)Communications Package to Holders of Company Stock Options in the
United Kingdom.
4
<PAGE>
Exhibit (a)(12)
September 5, 1997
Dear 401(k) Savings Plan Participant:
On August 22, 1997 Rhone-Poulenc S.A. ("RP") commenced a cash tender offer to
acquire, at a purchase price of $97 per share, the remaining shares of common
stock (the "Shares") of Rhone-Poulenc Rorer Inc. ("RPR") that it does not
currently own, including Shares in the Plan, upon the terms and subject to the
conditions set forth in the enclosed "Offer to Purchase" and in the related
Letter of Transmittal, which is also enclosed. THE LETTER OF TRANSMITTAL IS
----------------------------
FURNISHED TO YOU FOR YOUR INFORMATION ONLY AND CANNOT BE USED BY YOU TO TENDER
- ------------------------------------------------------------------------------
SHARES.
- ----------
American Express Trust Company, as Trustee of the Plan, is the holder of record
of Shares in the RPR Pooled Stock Fund. The RPR Pooled Stock Fund contains all
Shares in the Plan credited to participants' accounts, whether resulting from
Company match or self-directed investment. Only the Trustee, as holder of record
of the Shares, can tender the Shares in the RPR Pooled Stock Fund. As a
participant in this Fund, you have the right to instruct the Trustee to tender
the Shares credited to your Plan Account. To have your Shares tendered, you
must instruct the Trustee to do so.
For the offer to be completed, enough shares must be tendered to enable RP to
own at least 90 percent of RPR's outstanding shares. After the conclusion of
the offer, which expires at 5:00 p.m. (New York Time) on October 1, 1997, RP
will purchase the Shares tendered to it at a price of $97 per Share and will
likewise pay the Trustee $97 per tendered Share in the Plan. (The Trustee will
credit each participant's account as described below.)
If RP closes the tender successfully, it will eliminate the remaining minority
shareholding, including the Shares in the Plan which have not been tendered, by
-------------------------------------------------------------
effecting a merger of RPR with an RP subsidiary. When the merger is effective,
each remaining Share will be canceled and will be converted into a right to
receive the $97 offer price. THERE WILL, HOWEVER, BE A DELAY BETWEEN THE TIME
RP PAYS THE TRUSTEE FOR THE TENDERED SHARES AND THE PAYMENT FOR THE CANCELED
SHARES, SO IF YOU WANT YOUR SHARES TENDERED AND PURCHASED AT THE CLOSING OF THE
TENDER, BE SURE YOU GIVE NECESSARY INSTRUCTIONS TO THE TRUSTEE.
If you wish to instruct American Express Trust to tender the Shares credited to
you in the RPR Pooled Stock Fund, you MUST complete, sign and date the attached
INSTRUCTION FORM and send it to PROXY TABULATOR, P.O. BOX 9142, HINGHAM, MA
- -----------------
02043 in the enclosed envelope, so it is received BY SEPTEMBER 25, 1997.
-- ------------------
If you change your mind after you mail the INSTRUCTION FORM to the Trustee,
-----------------
then you may change your instruction by mailing the enclosed CHANGE OF
---------
INSTRUCTION FORM to: PROXY TABULATOR, PO BOX 9142, HINGHAM, MA 02043. All
- ----------------
forms must be received BY SEPTEMBER 25, 1997.
---------------------
(continued on back)
<PAGE>
To be effective, an Instruction Form or Change of Instruction Form must be
received by the Trustee in time to permit the Trustee to respond to the Offer as
indicated on your behalf. IF YOUR INSTRUCTION FORM OR CHANGE OF INSTRUCTION
FORM IS NOT RECEIVED BY THE TRUSTEE IN TIME FOR THE TRUSTEE TO SUBMIT A TENDER
ON YOUR BEHALF BY SEPTEMBER 25, 1997, YOU WILL BE DEEMED TO HAVE INSTRUCTED THE
TRUSTEE NOT TO TENDER SUCH SHARES. THE OFFER WILL EXPIRE AT 5:00 P.M. NEW YORK
------
CITY TIME, ON OCTOBER 1, 1997, UNLESS THE OFFER IS EXTENDED.
Please note that your instructions with respect to tendering will be known ONLY
by American Express Trust and its tabulator agency and will be maintained by the
Trustee and its agency in the strictest confidence.
SETTLEMENT OF THE RPR POOLED STOCK FUND
- ---------------------------------------
TENDERED SHARES
Should the tender offer be completed and cash paid to the Trustee for the
tendered shares in the Fund, the amount credited to your balance will be
transferred, within 1-2 business days into the AMERICAN EXPRESS INTEREST
ACCUMULATION ACCOUNT. The current 3-year restriction for investments in RPR
Shares will be lifted at the time of the cash-out. If you wish to transfer
these funds to other investment elections, you may do so via the participant
access line at American Express, 1-800-463-6401. You may use this line 24 hours
a day, 7 days a week.
SHARES NOT TENDERED
In the event that the merger is effected following the completion of the tender
offer, then shares that are not tendered will be held in the account and there
will be a delay in the cash-out of those shares. At that time, those funds will
be transferred into the American Express Interest Accumulation Account. If you
wish to subsequently transfer these funds, please call the participant access
line at American Express.
COMPANY MATCH
As in the past, the Company match for August will be made in RPR shares. In the
future, the percentage of the Company match will not change.
NEW INVESTMENT FUND
- -------------------
We are pleased to announce that, if the tender offer is successfully completed,
the Company match going forward will be made in shares of Rhone-Poulenc S.A.
The new Fund will be called the RP Pooled Stock Fund and will be structured like
the current RPR Pooled Stock Fund.
You will also have the opportunity to transfer employee contributions and/or
existing balances into the RP Pooled Stock Fund using the participant access
line. You will be notified when the Fund is available.
If you have questions, please call the participant access line at 1-800-463-
6401.
Very truly yours,
David A. Brandies
Vice President, Compensation and Benefits
<PAGE>
INSTRUCTION FORM
----------------
TO: American Express Trust Company, as Trustee (the "Trustee") of the Rhone-
Poulenc Rorer 401(k) Savings Plan (the "Plan")
DATE: September 5, 1997
I acknowledge receipt of a copy of the Offer to Purchase, dated August 22, 1997
and the related Letter of Transmittal with respect to the offer by Rhone-
Poulenc, S.A. to purchase all outstanding Shares of common stock of Rhone-
Poulenc Rorer, Inc. at a purchase price of $97.00 per share in cash (the
"Offer"). I instruct the Trustee to respond to the Offer with respect to the
shares of Rhone-Poulenc Rorer common stock credited to my RPR Pooled Stock Fund
Account as follows (check the desired box below).
[_] Tender all of the Shares credited to my RPR Pooled Stock Fund Account
as of October 1, 1997, upon the terms and subject to the conditions set forth in
the Offer to Purchase, and in the related Letter of Transmittal.,
[_] Do not tender the Shares credited to my RPR Pooled Stock Fund Account.
I understand that if I sign and return this form but leave the above boxes
blank, then the Shares credited to my RPR Pooled Stock Fund Account will not be
--------
tendered.
- --------------------------------------------------------------------------------
SIGN HERE
Signature: ____________________________________ Date: _________________________
Print Name & Address: __________________________________________________________
Area Code and
Telephone Number ____________________ Social Security Number ___________________
- --------------------------------------------------------------------------------
The number of shares credited to your RPR Pooled Stock Fund Accounts, as of
September 2, 1997 is reflected herewith. If you instruct the Trustee to tender,
the number of Shares tendered shall be the number credited to your RPR Pooled
Stock Fund Accounts at the time of tender.
Please mail this form to the address printed on the enclosed return envelope.
DO NOT SEND IT TO Rhone Poulenc Rorer Inc. To be effective, this Form must be
received no later than SEPTEMBER 25, 1997 to permit the Trustee to submit a
tender on your behalf prior to the expiration of the Offer. THE OFFER WILL
EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON OCTOBER 1, 1997 UNLESS THE OFFER IS
EXTENDED.
You may change your instruction by mailing the CHANGE OF INSTRUCTION FORM
(below) to PROXY TABULATOR, P.O. BOX 9142, HINGHAM, MA 02043. A CHANGE OF
INSTRUCTION FORM will be effective only if it is received by the trustee in time
for the Trustee to change its response to the Offer on your behalf prior to
expiration of the Offer.
- --------------------------------------------------------------------------------
IMPORTANT:
IF YOUR SIGNED INSTRUCTION FORM IS NOT RECEIVED BY THE TRUSTEE IN TIME FOR THE
TRUSTEE TO SUBMIT A TENDER ON YOUR BEHALF PRIOR TO EXPIRATION OF THE OFFER, YOU
WILL BE DEEMED TO HAVE INSTRUCTED THE TRUSTEE NOT TO TENDER THE SHARES CREDITED
TO YOUR PLAN ACCOUNTS.
- --------------------------------------------------------------------------------
<PAGE>
CHANGE OF INSTRUCTION FORM
THIS FORM WILL BE USED TO CHANGE YOUR PREVIOUS INSTRUCTIONS AND WILL BE
EFFECTIVE ONLY IF RECEIVED BY SEPTEMBER 25, 1997.
-------------------
I acknowledge receipt of a copy of the Offer to Purchase, dated August 22, 1997
and the related Letter of Transmittal with respect to the offer by Rhone-
Poulenc, S.A. to purchase all outstanding Shares of common stock of Rhone-
Poulenc Rorer, Inc. at a purchase price of $97.00 per share in cash (the
"Offer"). I instruct the Trustee to WITHDRAW MY PREVIOUS INSTRUCTIONS and to
----------------------------------
respond to the Offer with respect to the shares of Rhone-Poulenc Rorer common
stock credited to my RPR Pooled Stock Fund Account as follows (check the desired
box below).
[_] Tender all of the Shares credited to my RPR Pooled Stock Fund
Account as of October 1, 1997, upon the terms and subject to the conditions set
forth in the Offer to Purchase, and in the related Letter of Transmittal.,
[_] Do not tender the Shares credited to my RPR Pooled Stock Fund
Account.
- --------------------------------------------------------------------------------
SIGN HERE
Signature: ____________________________________ Date: ________________________
Print Name & Address: _________________________________________________________
Area Code and
Telephone Number _____________________ Social Security Number _________________
- --------------------------------------------------------------------------------
Please mail this form to : PROXY TABULATOR, P.O. BOX 9142, HINGHAM, MA 02043.
<PAGE>
Exhibit (a)(13)
September 8, 1997
To: Participants in the Centeon Employee Savings Plans (the "Plan")
On August 22, 1997 Rhone-Poulenc S.A. ("RP") commenced a cash tender offer to
acquire, at a purchase price of $97 per share, the remaining shares of common
stock (the "Shares") of Rhone-Poulenc Rorer Inc. ("RPR") that it does not
currently own, including Shares in the Plan, upon the terms and subject to the
conditions set forth in the enclosed "Offer to Purchase" and in the related
Letter of Transmittal, which is also enclosed. THE LETTER OF TRANSMITTAL IS
----------------------------
FURNISHED TO YOU FOR YOUR INFORMATION ONLY AND CANNOT BE USED BY YOU TO TENDER
- ------------------------------------------------------------------------------
SHARES.
- ----------
The Vanguard Group, as Trustee of the Plan, is the holder of record of Shares
in the RPR Pooled Stock Fund. The RPR Pooled Stock Fund contains all Shares in
the Plan credited to participants' accounts, whether resulting from old Company
match or self-directed investment. Only the Trustee, as holder of record of the
Shares, can tender the Shares in the RPR Pooled Stock Fund. As a participant
in this Fund, you have the right to instruct the Trustee to tender the Shares
credited to your Plan Account. To have your Shares tendered, you must instruct
the Trustee to do so.
For the offer to be completed, enough shares must be tendered to enable RP to
own at least 90 percent of RPR's outstanding shares. After the conclusion of
the offer, which expires at 5:00 p.m. (New York Time) on October 1, 1997, RP
will purchase the Shares tendered to it at a price of $97 per Share and will
likewise pay the Trustee $97 per tendered Share in the Plan. (The Trustee will
credit each participant's account as described below.)
If RP closes the tender successfully, it will eliminate the remaining minority
shareholding, including the Shares in the Plan which have not been tendered, by
-------------------------------------------------------------
effecting a merger of RPR with an RP subsidiary. When the merger is effective,
each remaining Share will be canceled and will be converted into a right to
receive the $97 offer price. THERE WILL, HOWEVER, BE A DELAY BETWEEN THE TIME
RP PAYS THE TRUSTEE FOR THE TENDERED SHARES AND THE PAYMENT FOR THE CANCELED
SHARES, SO IF YOU WANT YOUR SHARES TENDERED AND PURCHASED AT THE CLOSING OF THE
TENDER, BE SURE YOU GIVE NECESSARY INSTRUCTIONS TO THE TRUSTEE.
If you wish to instruct The Vanguard Group to tender the Shares credited to you
in the RPR Pooled Stock Fund, you MUST complete, sign and date the attached
INSTRUCTION FORM and return it to VANGUARD PROXY TABULATOR, P. O. Box 9133,
- -----------------
Hingham, MA 02043-9748 in the enclosed envelope, BY SEPTEMBER 25, 1997.
------------------------
If you change your mind after you mail the INSTRUCTION FORM to the Trustee,
-----------------
then you may change your instruction by mailing the enclosed CHANGE OF
---------
INSTRUCTION FORM to: VANGUARD PROXY TABULATOR, P. O. Box 9133, Hingham, MA
- ----------------
02043-9748. All forms must be received BY SEPTEMBER 25, 1997.
---------------------
<PAGE>
To be effective, an Instruction Form or Change of Instruction Form must be
received by the Trustee in time to permit the Trustee to respond to the Offer as
indicated on your behalf. IF YOUR INSTRUCTION FORM OR CHANGE OF INSTRUCTION
FORM IS NOT RECEIVED BY THE TRUSTEE IN TIME FOR THE TRUSTEE TO SUBMIT A TENDER
ON YOUR BEHALF BY SEPTEMBER 25, 1997, YOU WILL BE DEEMED TO HAVE INSTRUCTED THE
TRUSTEE NOT TO TENDER SUCH SHARES. THE OFFER WILL EXPIRE AT 5:00 P.M. NEW YORK
------
CITY TIME, ON OCTOBER 1, 1997, UNLESS THE OFFER IS EXTENDED.
Please note that your instructions with respect to tendering will be known ONLY
by The Vanguard Group and will be maintained by the Trustee in the strictest
confidence.
SETTLEMENT OF THE RPR POOLED STOCK FUND
- ---------------------------------------
TENDERED SHARES
Should the tender offer be completed and cash paid to the Trustee for the
tendered shares in the Fund, the amount credited to your balance will be
transferred, within 1-2 business days into the Vanguard Money Market Reserve
Fund. If you wish to transfer these funds to other investment elections, you
may do so via the Vanguard VOICE 24 hour network at 1-800-523-1188.
SHARES NOT TENDERED
Shares that are not tendered will be held in the account and there will be a
delay in the cash-out of those shares. At that time, those funds will be
transferred into the Vanguard Money Market Reserve. If you wish to transfer
these funds, please call the Vanguard VOICE 24 hour network.
RPR STOCK FUND
- --------------
Employee contributions and the Company match are wired to Vanguard on the 15th
of the month following the prior month-end payroll period and the Trustee uses
the cash to purchase RPR shares on the open market. The last contribution to the
RPR Stock in the Pooled Stock Fund will be for the month of August, which will
be wired by September 15. For the month of September and going forward, the
money you have allocated to the RPR Pooled Stock Fund will be redirected to the
Vanguard Money Market Reserve Fund. If you wish to redirect your contributions
to a different investment option, you may do so via the Vanguard VOICE 24 hour
network at 1-800-523-1188.
If you have questions, please call the Vanguard VOICE 24 hour network at 1-800-
523-1188.
Sincerely,
Jennifer Blodgett
Sr. Manager, Compensation and Benefits
<PAGE>
INSTRUCTION FORM
----------------
TO: The Vanguard Group as Trustee (the "Trustee") of the Centeon Employee
Savings Plans (the "Plan")
DATE:
I acknowledge receipt of a copy of the Offer to Purchase, dated August 22, 1997
and the related Letter of Transmittal with respect to the offer by Rhone-
Poulenc, S.A. to purchase all outstanding Shares of common stock of Rhone-
Poulenc Rorer, Inc. at a purchase price of $97.00 per share in cash (the
"Offer"). I instruct the Trustee to respond to the Offer with respect to the
shares of Rhone-Poulenc Rorer common stock credited to my RPR Pooled Stock Fund
Account as follows (check the desired box below).
[_] Tender all of the Shares credited to my RPR Pooled Stock Fund Account
as of October 1, 1997, upon the terms and subject to the conditions set forth in
the Offer to Purchase, and in the related Letter of Transmittal.,
[_] Do not tender the Shares credited to my RPR Pooled Stock Fund Account.
I understand that if I sign and return this form but leave the above boxes
blank, then the Shares credited to my RPR Pooled Stock Fund Account will not be
--------
tendered.
- --------------------------------------------------------------------------------
SIGN HERE
Signature: _________________________________________ Date: ___________________
Print Name & Address: _________________________________________________________
Area Code and
Telephone Number ________________________ Social Security Number ______________
- --------------------------------------------------------------------------------
The number of shares credited to your RPR Pooled Stock Fund Accounts, as of
September 2, 1997 is reflected herewith. If you instruct the Trustee to tender,
the number of Shares tendered shall be the number credited to your RPR Pooled
Stock Fund Accounts at the time of tender.
Please mail this form to the address printed on the enclosed return envelope. DO
NOT SEND IT TO Centeon. To be effective, this Form must be received no later
than SEPTEMBER 25, 1997 to permit the Trustee to submit a tender on your behalf
prior to the expiration of the Offer. THE OFFER WILL EXPIRE AT 5:00 P.M., NEW
YORK CITY TIME, ON OCTOBER 1, 1997 UNLESS THE OFFER IS EXTENDED.
You may change your instruction by mailing the CHANGE OF INSTRUCTION FORM
(below) to VANGUARD PROXY TABULATOR, P.O. BOX 9133, HINGHAM, MA 02043-9748. A
CHANGE OF INSTRUCTION FORM will be effective only if it is received by the
trustee in time for the Trustee to change its response to the Offer on your
behalf prior to expiration of the Offer.
- --------------------------------------------------------------------------------
IMPORTANT:
IF YOUR SIGNED INSTRUCTION FORM IS NOT RECEIVED BY THE TRUSTEE IN TIME FOR THE
TRUSTEE TO SUBMIT A TENDER ON YOUR BEHALF PRIOR TO EXPIRATION OF THE OFFER, YOU
WILL BE DEEMED TO HAVE INSTRUCTED THE TRUSTEE NOT TO TENDER THE SHARES CREDITED
TO YOUR PLAN ACCOUNTS.
- --------------------------------------------------------------------------------
<PAGE>
CHANGE OF INSTRUCTION FORM
THIS FORM WILL BE USED TO CHANGE YOUR PREVIOUS INSTRUCTIONS AND WILL BE
EFFECTIVE ONLY IF RECEIVED BY SEPTEMBER 25, 1997.
-------------------
I acknowledge receipt of a copy of the Offer to Purchase, dated August 22, 1997
and the related Letter of Transmittal with respect to the offer by Rhone-
Poulenc, S.A. to purchase all outstanding Shares of common stock of Rhone-
Poulenc Rorer, Inc. at a purchase price of $97.00 per share in cash (the
"Offer"). I instruct the Trustee to WITHDRAW MY PREVIOUS INSTRUCTIONS and to
----------------------------------
respond to the Offer with respect to the shares of Rhone-Poulenc Rorer common
stock credited to my RPR Pooled Stock Fund Account as follows (check the desired
box below).
[_] Tender all of the Shares credited to my RPR Pooled Stock Fund Account
as of October 1, 1997, upon the terms and subject to the conditions set forth in
the Offer to Purchase, and in the related Letter of Transmittal.,
[_] Do not tender the Shares credited to my RPR Pooled Stock Fund Account.
- --------------------------------------------------------------------------------
SIGN HERE
Signature: ________________________________________ Date: ____________________
Print Name & Address: _________________________________________________________
Area Code and
Telephone Number ________________________ Social Security Number ______________
- --------------------------------------------------------------------------------
Please mail this form to: VANGUARD PROXY TABULATOR, P.O. BOX 9133, HINGHAM, MA
02043-9748.
<PAGE>
Exhibit (a)(14)
TO: RHONE-POULENC RORER INC. DIVIDEND REINVESTMENT
PLAN PARTICIPANTS
RE: INFORMATION ABOUT YOUR ELECTION TO TENDER
COMMON SHARES
- --------------------------------------------------------------------------------
Under the Rhone-Poulenc Rorer Inc. Dividend Reinvestment Plan (the "DRIP"),
participants have the right to exercise voting rights and other rights incident
to the shares of stock allocated to the participant's account.
Pursuant to the Agreement and Plan of Merger, dated as of August 19, 1997, among
Rhone-Poulenc S.A. (the "Purchaser"), RP Vehicle, Inc. and Rhone-Poulenc Rorer
Inc. the Purchaser has commenced a cash tender offer (the "Offer") to purchase
all of the outstanding common shares, without par value, of the Company (the
"Shares") at $97 per Share, net to the seller in cash (the "Offer Price"), and
the Offer is being passed through to the DRIP participants to decide whether or
not to tender the Shares held in their accounts.
Your DRIP account currently holds Shares. You may direct The Bank of New York,
the Trustee of the DRIP, to tender all or any portion of your Shares in the
DRIP.
You have already been sent information about the Offer under separate cover.
You are encouraged to review that information carefully, so that you can make an
informed decision about whether or not to tender your Shares in the DRIP.
Although we have provided you with all of the Tender Offer information that has
been sent to the other shareholders of the Company, because your Shares are held
in the DRIP account, the manner in which you may tender your Shares is different
from the election procedures for shareholders who hold their stock directly.
IF YOU DESIRE TO TENDER ALL OR ANY PORTION OF YOUR SHARES, DO NOT
COMPLETE THE LETTER OF TRANSMITTAL WITH RESPECT TO YOUR DRIP SHARES.
INSTEAD, COMPLETE THE FORM CALLED "DRIP ELECTION TO TENDER SHARES OF
COMMON STOCK" AND RETURN THAT COMPLETED FORM TO THE TRUSTEE IN THE
ENCLOSED ENVELOPE. IF YOU HAVE ALREADY SENT IN THE LETTER OF TRANSMITTAL
WITH RESPECT TO YOUR DRIP SHARES, PLEASE ALSO COMPLETE AND RETURN THE
ELECTION.
The Election must be received by The Bank of New York, the Trustee of the
DRIP, no later than September 30, 1997, or your DRIP account will remain
invested in Shares.
You are urged to read the Offer materials carefully and consider all factors
set forth therein before making your decision with respect to the Offer.
Very truly yours,
Michel de Rosen
Chairman & Chief Executive Officer
- --------------------------------------------------------------------------------
RHONE-POULENC RORER INC.
DRIP ELECTION TO TENDER SHARES OF COMMON STOCK
Account No.
Share Balance
1. [_] Please Tender All 2. [_] Please Tender Only [_][_][_][_][_][_] Shares.
DRIP Shares
The Offer is subject to the Terms and
Conditions set forth in the Offer to
Purchase dated August 22, 1997.
---------------------------------------------------
Signature Date / /
---------------------------------------------------
Signatures Of All Participants Are Required / /
<PAGE>
Exhibit (a)(15)
RHONE-POULENC RORER INTEROFFICE CORRESPONDENCE
- --------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C>
DATE 9 SEPTEMBER 1997 INFORMATION
COPIES
TO ALL RPR STOCK OPTION HOLDERS TO
FROM HADIA LEFAVRE,
SVP HUMAN RESOURCES
</TABLE>
- ---------------------------------------------------------
SUBJECT INFORMATION FOR OPTION HOLDERS NO LONGER WITH RPR
If the current tender offer by RP is closed successfully, you will
have your existing RPR stock options canceled and cashed out at the
$97 offer price. The gains received by you in the cashout will be
considered ordinary income and you will be subject to applicable
income and FICA taxes for 1997 on the full amount. For many, this
will cause you to be taxed at a higher tax bracket if you receive
the full cashout gains in 1997.
We have received many requests from option holders for alternatives
to this cashout approach and, with the assistance of many people at
RPR and RP, we have been able to develop an alternative for you in
the US. In this alternative, your gain as of August 22nd, the day
the tender offer was launched, is carried over into the new program
with favorable terms and conditions. In offering choices, we are
attempting to assist you in better managing your tax and financial
planning needs.
The alternative to receiving cash is:
* A CASH DEFERRAL PLAN WHICH ALLOWS YOU TO DEFER THE IMMEDIATE
PAYMENT WITH INTEREST AND TO RECEIVE 3 EQUAL PAYMENTS OF PRINCIPAL,
WITH INTEREST COMPOUNDED MONTHLY, OVER 3 YEARS.
You have the choice between any combination of cash and/or the cash
-------------------------------------------------------------------
deferral plan for each stock option award. The cash deferral plan is
-----------------------------------------
described in more detail on the following page.
<PAGE>
* CASH DEFERRAL PLAN
- --------------------
If you would prefer not to receive all of your option gains in this tax year,
you can defer, on the grants that you choose and on an pre-tax basis, those
gains you want to receive over a three-year period. This alternative is the
short-term Cash Deferral Plan. All US option holders are eligible and you can
pick and choose which of your grants you would like to defer. For many, the
gains from cashing out the RPR options will result in higher marginal federal
taxes than you would normally pay. Even if the tax implications are not an
issue, you may still want to defer this cash and receive a payout over time. A
key plan feature is that THE MONEY DEFERRED EARNS INTEREST during the 3-year
deferral period -- on a gross (pre-tax) versus net (after-tax) amount.
Plan Features:
- --------------
* Open to all US RPR stock option holders.
* Defers existing gain into a short-term deferral plan of 3 years allowing you
to spread out the gain and better manage their tax liability.
* You can earn interest on their deferred pre-tax gain during the 3 year
period.
* The interest rate for this deferral plan will be six month LIBOR (London
Interbank Offered Rate, a universally-recognized borrowing rate). As of this
writing, LIBOR is approximately 6%. The interest rate will be determined on
October 1, 1997 and then will be adjusted every six months thereafter. IN
ADDITION, AN INTEREST RATE PREMIUM OF 1% WILL BE ADDED TO THE SIX MONTH LIBOR
-------------
RATE.
* You would receive payouts of 1/3 of the amount deferred plus interest in
October of years 1998, 1999 and 2000.
* Income received from this deferral plan will be considered ordinary income
earned in the year it is paid out and will be subject to income tax in that
year.
* All deferrals are subject to FICA payable at the time of deferral.
* In the case of death, the balance of your deferral would be paid to your
beneficiary or estate as requested.
The terms of this deferral should raise some questions for you on whether this
will better meet your tax and financial needs rather than taking the cash this
year. This plan offers you a very competitive rate when compared with what is
available from banks and there is little risk to your money. It would only be at
risk if RPR goes bankrupt. If you compare LIBOR + 1% to your normal after-tax
investment return, we believe you would need to get a rate of 8-13%, depending
on your tax bracket, in order to equal what you could receive in this deferral
plan.
PLAN SUMMARY: US CASH DEFERRAL PLAN ALLOWS YOU TO DEFER MONIES OVER 3 YEARS--
POTENTIALLY LESSENING YOUR IMMEDIATE INCOME TAX IMPACT AND RECEIVING INTEREST ON
THE MONEY DEFERRED AT AN ATTRACTIVE INVESTMENT RATE.
<PAGE>
PROCESS
- -------
Enclosed you will find the formal documents addressing the cancellation and
cashing out of your RPR stock options. Part of this is an Election Form that you
must complete and return to Collegeville in the enclosed postage-paid envelope.
IF YOU ARE INTERESTED IN ALLOCATING ANY PORTION OF YOUR GAIN INTO THE DEFERRAL
PLAN, YOU MUST RETURN YOUR SIGNED ELECTION FORM BY MIDNIGHT (EDT) SEPTEMBER 15,
1997. You can fax your form to 610-454-3076 or 610-454-3607 and as long as it is
received by the above deadline, we can accept it as your election form,
providing the original form is also received within one week. If no form is
received by September 15, then you will receive the cashout following the
successful close of the tender.
SUMMARY
- -------
It is our belief that the alternative being offered can be advantageous to you
and that there are reasons to consider it in lieu of receiving cash. The goal of
all the work done by RP and RPR is to offer you the best alternatives possible
to manage your tax and financial needs. However, while we are comfortable with
the alternative we are offering, we can't predict interest rate fluctuation,
stock price performance, currency exchange rates, etc., nor can we guarantee
favorable consequences, if any, of this alternative. It is ultimately your
choice and therefore you are responsible for your tax liabilities now and in the
future, especially in the event of any adverse determination by tax authorities.
It is strongly recommended that you seek the advice of your tax and/or financial
planning advisor on which choices are best for you.
For specific questions, please contact the Stock Administration Hotline at 610-
454-3662 or fax 610-454-3076 or 610-454-3607.
<PAGE>
PAYMENT ALTERNATIVES TO RPR STOCK OPTION GAINS
FOR OPTION HOLDERS NO LONGER WITH RPR
The following alternatives to your RPR stock option gains are being offered by
Rhone-Poulenc.
ELECTION A (ALL STOCK OPTION HOLDERS ARE ELIGIBLE)
All your outstanding options will be cashed out at a value of $97.00. Your gain
will be taxed as ordinary income earned in 1997. Your FEDERAL tax will be
withheld at the rate of 28%; however, you may elect to have up to 39.6% of
federal tax withheld. If you wish to have a percentage higher than 28% withheld
from this income, please complete the attached FEDERAL tax election form and
return it in the enclosed envelope along with your election form.
ELECTION B (US-BASED STOCK OPTION HOLDERS)
The cash-out value of your grant under this election will be deferred on a
short-term basis. You will receive three installment payments over three years
from the closing date of the tender. These payments will include principal and
interest consisting of the 6-month LIBOR Borrowing rate (cost of money adjusted
every six months) plus 1%. For example, in 1997, LIBOR approximates 6% which
with a 1% premium yields a total of 7%. Each payment (principal and interest)
will be considered ordinary income earned in the year of distribution and will
be taxed as such in that year.
Additionally, if you were to terminate within three years, for any reason other
than death, your deferral would continue. You currently have the option to
elect to receive a lump sum distribution in the event of termination by
completing and signing the enclosed Cash Deferral Distribution Election form.
You are fully vested in these monies and have the rights of a creditor of Rhone-
Poulenc Rorer, Inc.
INSTRUCTIONS FOR COMPLETING THE ELECTION FORM
On the attached Election form, please indicate your election BY PERCENTAGE for
each stock option grant in increments of 25%. These elections must total 100%
for each grant. For example, you may elect 50% cash-out, 25% cash deferral and
25% RP stock or 100% cash-out. Please note that only the elections for which
you are eligible are listed for each grant. If your total election(s) do not
equal 100%, an adjustment will be made to your cashout election so that your
total election(s) do equal 100%. Furthermore, if you do not make an election or
make an alternate election, in either case, you would be cashed out under
Election A. Finally, please note that these election forms, dated September 2,
1997, reflect your outstanding options through September 1, 1997. Any exercise
or cancellation activity after this date is not reflected on this election form.
Please make your elections accordingly.
Please use the enclosed envelope to return your election form(s). If you want
Election B, you must return your form by September 15, 1997. Faxes will be
-------------------
accepted until 12 midnight on September 15, 1997 (610) 454-3076 or (610) 454-
3607; however, the original election form(s) must be received within one week.
If you have any questions, please call the Stock Administration hotline (610)
454-3662.
<PAGE>
QUESTIONS & ANSWERS ABOUT YOUR RPR STOCK OPTIONS
FOR OPTION HOLDERS NO LONGER WITH RPR
GENERAL QUESTIONS
- -----------------
Q. WHY ARE ALTERNATIVES BEING OFFERED FOR THE CANCELLATION OF RPR STOCK OPTION
GRANTS?
A. Employees are being offered alternatives to help them manage their stock
option gains. The alternatives are: a cash payment and a cash deferral plan.
These choices allow employees to plan their tax payments and cash flow more
effectively.
Q. WHAT ARE THE BENEFITS AND RISKS OF EACH ALTERNATIVE?
A. RPR can describe the alternatives available and their features, but we cannot
advise you on which choice to make. You know your financial situation best and
should discuss all alternatives with your personal tax and/or financial advisor.
Q. CAN I COMBINE ALTERNATIVES?
A. Yes. You will be required to make an election for each stock option grant in
25% increments. The elections for which you are eligible are listed for each
grant on your personalized election form.
Q. WHO WILL HANDLE THESE TRANSACTIONS? WILL THERE BE ADMINISTRATIVE CHARGES FOR
PROCESSING ANY OF THESE TRANSACTIONS?
A. Smith Barney will handle the cashout for the U.S. option holders who elect
to receive cash. You will not be subject to any commission or fees if you
participate in the tender. However, if you choose to exercise your options
prior to October 1, 1997, you will have to pay the customary fees.
Q. ONCE I CHOOSE MY ELECTION, CAN I CHANGE MY MIND?
A. No, your election is irrevocable. You will need to return your election form
to RPR Stock Administration by midnight (EDT), September 15, 1997. Forms may be
-----------------------------------
faxed back as long as they are followed by the originals within one week. The
fax numbers for Stock Administration are (610) 454-3076 or (610) 454-3607.
Q. WHAT HAPPENS IF I DO NOT RETURN MY FORM?
A. If your form is not received by September 15, 1997, and the tender closes as
proposed, you will receive a cash payment equal to the difference between $97
and the exercise price(s) of your options (less withholding taxes).
Q. WHAT IF I DO NOT WANT TO SURRENDER MY STOCK OPTIONS?
A. If RP is successful in this merger and achieves a 90% ownership position, all
remaining option holders will have their options canceled and will receive a
payment equal to the difference between the $97.00 offer price and the exercise
price of your options less withholding taxes. If you do not wish to receive
cash for your options, you might want to consider the alternative plan.
1
<PAGE>
GENERAL QUESTIONS (CONT'D)
- -----------------------------
Q. WHAT HAPPENS TO THE RPR SHARES IN THE COMPANY'S 401(K) SAVINGS PLAN?
A. Participants in the company's 401(k) savings plan will receive
communications from American Express soliciting instructions about tendering the
shares of RPR stock owned by the pooled stock fund.
Q. WHEN CAN I EXPECT THE PAYOUT TO HAPPEN? WHEN WILL I GET MY CHECK? WILL I GET
DIFFERENT CHECKS AT DIFFERENT TIMES FOR THE DIFFERENT GRANT CHOICES I MAKE? CAN
THE MONEY BE DIRECT DEPOSITED INTO MY BANK OR AS PART OF MY PAYCHECK?
A. You will receive your cashout within 2 weeks of the close of the tender
offer, if successful. You will receive one payment for all your cash elections.
If you are interested in direct deposit of your cash payout, you would have to
deal directly with Smith Barney on this issue and you would be responsible for
any wire fees. You can reach Smith Barney at 1-800-235-1205, extension 9533 or
617-570-9533.
Q. WHO CAN I CALL FOR CLARIFICATION OR WITH QUESTIONS?
A. For general questions about RPR Stock Options, you can call the Stock
Administration hotline in Collegeville at (610) 454-3662.
2
<PAGE>
ELECTION A - CASHOUT
- --------------------
Q. HOW WILL THE CASHOUT BE HANDLED? DO I NEED TO FILL OUT ANY ADDITIONAL FORMS
OR SUBMIT A CHECK FOR THE OPTION EXERCISE?
A. If you do not exercise any of your vested options before October 1, and elect
to tender your stock options for cash, you will automatically receive a check
from Smith Barney within 2 weeks of the close of the tender. There are no
employee fees for the cashout and you will not need to write a check for the
exercise price. You will receive the difference between $97 and the exercise
price for each option you hold (less taxes). If you want to choose the other
alternative for part or all of your option awards, you need to fill out the
enclosed election form and return it by September 15, 1997.
Q. IN WHAT CURRENCY WILL MY GAIN BE DISTRIBUTED?
A. The stock option cashouts will be made in US dollars for all US participants.
Q. WHAT ARE THE TAX CONSEQUENCES FOR A CASHOUT OF MY OUTSTANDING RPR OPTIONS?
A. Your gain (the difference between the $97.00 offer price and the grant price)
will be taxed as ordinary income earned in 1997. Federal income taxes will be
withheld at 28% as required by law, no matter which tax bracket you are in. Your
Federal income tax burden for 1997 will depend on your total income tax position
for the year. You can elect to have Federal taxes withheld from 28% to 39.6% by
filling out and returning the enclosed Federal Tax Election Form. The applicable
state, local and FICA taxes will be withheld from your gains. If the tax
implications are a concern for you, you may want to consider the other available
alternatives.
3
<PAGE>
ELECTION B - CASH DEFERRAL PLAN
- -------------------------------
Q. WHAT IS LIBOR BORROWING RATE AND WHERE IS IT PUBLISHED?
A. LIBOR is London Interbank Offered Rate and is the average of interbank
offered rates for Dollar deposits in the London market based on quotations at
five major banks. The LIBOR rate is published daily in the financial section of
most daily newspapers, including the Wall Street Journal.
Q. WHY WAS LIBOR CHOSEN AS THE INTEREST RATE FOR THE DEFERRAL ALTERNATIVE?
A. LIBOR is a well known and readily accessible market rate.
Q. WHAT ARE THE TAX BENEFITS TO ELECTING A CASH DEFERRAL?
A. Aside from the benefit of being able to invest the gains on a pretax basis,
many RPR employees will be faced with "tax bracket creep" because of the size of
their gains. The deferral enables you to spread your tax liability over three
years thus reducing the amount of tax someone with tax bracket creep would have
to pay versus taking the cashout all at once. Federal taxes are deferred until
the time you receive a distribution from the plan. FICA taxes are non-
deferrable and need to be paid at the time of the deferral. The total amount
that you defer will be net of any FICA and applicable taxes.
Q. IS MY DEFERRAL DISTRIBUTION GUARANTEED TO PAY OUT EACH YEAR DURING THE THREE-
YEAR DEFERRAL PERIOD?
A. Any monies you might defer are held as general assets of Rhone-Poulenc Rorer.
As a participant of the plan, you are an unsecured creditor of the company with
respect to your plan benefits. However, in the case of bankruptcy of RPR, you
will be paid out as promised.
Q. CAN I WITHDRAW MY DEFERRAL AT ANY TIME OTHER THAN THE 3 SCHEDULED ANNUAL
PAYMENTS?
A. No.
Q. CAN MY DEFERRAL DISTRIBUTION BE ROLLED OVER TO AN IRA?
A. No. The RPR stock option program is not an IRS tax-qualified plan. You must
take payout of your deferral over the three year period.
Q. IF I DIE WITHIN THE THREE-YEAR PERIOD, WILL MY BENEFICIARIES BE ENTITLED TO
THE DEFERRAL MONIES IN MY ACCOUNT? DO I NEED TO IDENTIFY A SPECIFIC BENEFICIARY?
A. Yes. Your beneficiaries (or your estate) would receive a lump sum payout of
your deferral account. If you elect cash deferral, you will need to fill out
the enclosed beneficiary form and return it with your election form.
4
<PAGE>
EXHIBIT (a)(16)
INTERNAL CORRESPONDENCE
[LETTERHEAD FOR RHONE-POULENC RORER APPEARS HERE]
PRIVATE & CONFIDENTIAL
TO: All RPR Stock Option Holders
FROM: Hadia Lefavre
DATE: 10 September 1997
SUBJECT: RPR STOCK OPTIONS - ALTERNATIVES OFFERED BY THE RP TENDER
----------------------------------------------------
If the current tender offer by RP is closed successfully, you will have your
existing RPR stock options, both vested and unvested, cancelled and cashed out
at the $97 offer price. The gains received by you in the cash out will be
considered ordinary income and we will inform the Inland Revenue within 30 days
of the end of the tax year i.e. by 6/th/ May 1998. For the 1997 grant, we may
be required to make PAYE deductions and we are awaiting advice on this.
We have received many requests from employees for alternatives to this cash out
approach and we have been able to develop one alternative for you in the UK.
With this alternative, your gain as of August 22/nd/, the day the tender offer
was launched, is carried over into the new programme.
The alternative to receiving cash is:
THE RP CONTINUITY PLAN
The RP Continuity Plan allows you to convert your existing RPR options that are
LESS THAN 5 YEARS OLD into RP Stock Options with the exercise price set so that
a gain comparable to that existing in the RPR options you hold is built into the
new RP options based on the date of the tender offer.
You have the choice between any combination of cash and / or one RP Continuity
- ------------------------------------------------------------------------------
Plan described above for each stock option award. Each of these alternatives
- -------------------------------------------------
has distinct benefits and are explained in more detail on the following pages.
THE RP CONTINUITY PLAN
The alternative to receiving cash is to convert your RPR options into RP stock
options. The conversion rate that has been established by the tax authorities
in France and would be applied worldwide is an attractive 2.4 RP OPTIONS FOR
EVERY RPR OPTION. This conversion is based on RPR and RP stock prices on August
22/nd/, 1997, the date RP launched its tender offer. Details on the conversion
rate are addressed in the enclosed Q & A.
This alternative can be very beneficial as it allows you to continue to hold
stock options with the potential for appreciation in value carried out into the
future and you would not have to pay taxes today. This choice would apply only
for those option grants which are LESS THAN 5 YEARS OLD as of October 1/st/
1997.
<PAGE>
PLAN FEATURES
. Available to all active RPR and Centeon employees, as of October 1/st/ 1997.
. Converts existing RPR options which are less than five years old into RP
options for active RPR employees
. Offers 2.4 RP options for every RPR option
. The new RP option exercise price is set by dividing the existing RPR exercise
price by 2.4
. Your converted RP stock options are immediately vested
. The other basic terms and conditions of the RPR stock option programme will
hold for the RP stock option - that is, if your RPR option has seven years
left before it expires, your new RP stock option will have seven years in
which you can exercise
. The same rules apply with respect to resignation, death, disability, and
retirement as currently exist in the RPR stock option programme
. You will continue to be able to exercise your converted RP option in the
event you are involuntarily terminated, for reasons other than for cause, for
the remainder of the initial ten year term
. RP has established a maximum number of RP options that can be granted in this
Continuity Plan. In the event the number of RP options resulting from the
selection of this alternative exceeds the maximum, there will be an equitable
reduction across the organisation
This continuity approach links you to the future success of the new Rhone-
Poulenc organisation and its emphasis on the Life Sciences business.
PLAN SUMMARY: The RP Continuity Plan allows you to convert your existing RPR
options into RP stock options. The gains existing in the RPR options being
converted would, as of August 22/nd/, be maintained in the RP option. Stock
price appreciation is what makes an option valuable and, as we have seen in the
past with RPR options, stock value varies over time. You can determine when and
how you will exercise and incur the tax liability.
PROCESS
- -------
Enclosed you will find the formal documents addressing the cancellation and
cashing out of your RPR stock options. Part of this is an Election Form that
you must complete and return to your local Human Resources Director. If you are
interested in allocating any portion of your gain into the Continuity Plan, you
must return your signed election form by midday on September 26/th/ 1997, to
your local HR Director. These forms will then be collected and sent by Federal
Express to RPR Collegeville.
You can fax your form to 00 610 454 3076 or 00 610 454 3607 and provided it is
received by the deadline, we can accept it as your election form, providing the
original form is also received within one week. If no form is
received by September 26/th/, then you will receive the cash out following the
successful close of the tender.
FUTURE COMPENSATION PHILOSOPHY
- ------------------------------
We have had preliminary discussions with Rhone-Poulenc regarding our
compensation philosophy going forward. They are comfortable with our
compensation philosophy and principals and therefore see no reason to change.
We will remain a pay-for-results company and will continue to be competitive
locally within our industry. We are working on the details of what exactly the
replacement for RPR stock options will be, but we will continue to offer long
term incentives as part of our total compensation philosophy. As soon as the
details of the new plan are approved, we will communicate them to you.
<PAGE>
SUMMARY
- -------
It is our belief that the alternative being offered can be advantageous to you
and that there are reasons to consider it in lieu of receiving cash. The goal
of all the work done by RP and RPR is to offer you the best alternative possible
to manage your tax and financial needs. However, while we are comfortable with
the alternative we are offering, we cannot predict interest rate fluctuation,
stock price performance, currency exchange rates etc, nor can we guarantee
favourable consequences, if any, of this alternative. It is ultimately your
choice and therefore you are responsible for your tax liabilities now and in the
future, especially in the event of any adverse determination by tax authorities.
It is strongly recommended that you seek the advice of your tax and / or
financial planning advisor on which choices are best for you.
For specific questions, please contact your UK HR Generalist or the Stock
Administration Hotline on 00 610 454 3662 or fax on 00 610 454 3076 or 00 610
454 3607.
Regards
Hadia Lefavre
<PAGE>
QUESTIONS & ANSWERS ABOUT YOUR RPR STOCK OPTIONS
Q What are the benefits and risks of each alternative?
A RPR can describe the alternatives available and their features, but we
cannot advise you on which choice to make. You know your financial
situation best and should discuss all alternatives with your personal tax
and / or financial adviser.
Q Can I combine alternatives?
A Yes. You will be required to make an election for each stock option grant
in 25% increments. The elections for which you are eligible are listed
for each grant. Only grants less than five years old will be eligible for
the RP Continuity Plan.
Q Who will handle these transactions ? Will there be administrative charges
for processing any of these transactions ?
A Smith Barney will handle the cash out for the UK stock option holders who
elect to receive cash. You will not be subject to any commission or fees
if you participate in the tender. However, if you choose to exercise your
options prior to October 1/st/ 1997, you will have to pay the customary
fee.
Q Once I choose my election, can I change my mind ?
A No. Your election is irrevocable. You will need to return your election
form to your HR Director by midday on September 26/th/ 1997. After this
date you may fax your election form to Stock Administration on 00 610 454
3076 or 00 610 454 3607.
Q What happens if I do not return my form ?
A If your form is not received by September 26/th/ 1997, and the tender
closes as proposed, you will receive a cash payment equal to the
difference between $97 and the exercise price(s) of your options.
Q What if I do not want to surrender my stock options ?
A If RP is successful in this merger and achieves a 90% ownership position,
all remaining option holders will have their options cancelled and will
receive a payment equal to the difference between the $97 offer price and
the exercise price of your options. If you do not wish to receive cash
for your options, you might want to consider the alternative plan.
Q What happens if I leave the Company before the close of the tender
period ? What about voluntary or non-voluntary termination ? Retirees ?
A If you leave RPR for any reason before the close of the tender period,
all vested RPR options will Be cashed out and all unvested RPR options
will be cancelled without payment.
<PAGE>
Q When can I expect the payout to happen ? When will I get my cheque ? Will
I get different cheques at different times for the different grant
choices I make ? Can the money be direct deposited into my bank or as
part of my pay cheque ?
A You will receive your cash out within 2 weeks of the close of the tender
offer, if successful. You will receive one payment for all your cash
elections.
Q Is there any reason why my stock options would not be cashed out or would
be delayed-for example, if I am on Personal Leave or absent due to
illness ?
A All eligible option holders will be paid out at the same time regardless
of leave of absences.
Q Who can I call for clarification or with questions ?
A Please call your local HR Director / Manager.
<PAGE>
ELECTION A - CASH OUT
- ---------------------
Q How will the cash out be handled ? Do I need to fill out any additional
forms or submit a check for the option exercise ?
A If you do not exercise any of your vested options before October 1/st/,
and elect to tender your stock options for cash, you will automatically
receive a cheque from Smith Barney within two weeks of the close of the
tender. There are no employees fees for the cash out and your will not
need to write a cheque for the exercise price. You will receive the
difference between $97 and the exercise price for each option you hold
(less taxes). If you want to choose the other alternative for part or all
of your option awards, you need to fill out the enclosed election form
and return it by midday on September 26/th/ 1997 to your local HR
Director / Manager.
Q Will my vested, as well as my unvested, options be eligible for the cash
out value of $97 ?
A Yes. As long as you are actively employed by RPR as of the close of the
tender offer (October 1/st/ 1997).
Q What are the tax consequences for a cash out of my outstanding RPR
options ?
A Your gain (the difference between the $97 offer price and the grant
price) will be taxed as ordinary income earned in 1997.
For all options granted before 1997, we will inform the Inland Revenue of
the exercise gain, for each employee concerned by the 6/th/ May 1998. It
is the responsibility of each employee concerned to report details of
these cash payments to the Inland Revenue on their annual tax returns for
the year 1997 / 98. For the option grant in 1997, PAYE deductions may
have to be made. We are awaiting advice on this question. If deductions
are to be made on a PAYE basis, this will be processed through the
payroll.
<PAGE>
ELECTION B - RP CONTINUITY PLAN
- -------------------------------
Q If I exchange my RPR stock options for RP options, am I automatically
vested and are the options exercisable at any time ?
A Yes. Your exchanged options will vest upon receipt of your grant and will
be available for exercise. You will have the remaining life of your
exchanged RPR option in which to exercise. For example, if you exchange a
four year old RPR option for RP options, you would have six years in
which to exercise the option before it would expire, if you remain
actively employed. (See below for other circumstances.)
Q How will my RPR stock options be converted into RP options ?
A Your RPR options will be converted into RP options at the rate of 2.4 RP
stock options for each RPR stock option. The exercise price of the new RP
option will be equal to the exercise price of the RPR option to be
converted, divided by 2.4. An example has been included in the
documentation describing the RP Continuity Plan.
Q How was the conversion rate of 2.4 RP options for each RP option
established ?
A The conversion rate was established by the tax authorities in France as
follows: The RPR tender price of $97 was converted into FF 593.83 (using
an exchange rate of 6.122) and then divided by the closing price of RP
(FF 247.5) on the Paris Bourse, as of the date of the offer (August
22/nd/ 1997). The conversion is 593.83 / 247.5 = 2.4 RP options for each
RPR option. The exercise price of the new RP option would be the
exercise price of the RPR option divided by the conversion rate.
Q Can I exchange all my RPR stock options for RP stock options ?
A No. Only stock options granted since October 1/st/ 1992 are eligible for
exchange into RP stock options.
Q What will be the process for exercising RP stock options ?
A Further communication regarding RP options will be provided when the
grants are made.
Q Is there a limit to the number of RP shares available ?
A Yes.
Q What happens if the option exchange is over subscribed ?
A If the option continuity plan is oversubscribed, we will look at all
employee elections by country to determine an equitable way to reduce the
number. Any possible reductions will be handled proportionately within a
country. If the option continuity plan is oversubscribed, we will look
at all employee elections by country to determine an equitable way to
reduce the number. Any possible reductions will be handled
proportionately within a country.
<PAGE>
Q What happens if I do not make an alternative election and the option
exchange is over-subscribed?
A Your outstanding options under each grant will be cashed out.
Q What has been the average RP stock price within the last year ?
A Over the past year, RP ADR's (American Depository Receipts) have been
trading between $25 and $44.
Q If I leave the Company, will my RP options expire ?
A If you voluntarily leave RPR, you will have six months in which to
exercise your options. However, if you are involuntarily terminated for
reasons other than for cause, you will have the balance of the remaining
life of the original RPR option in which to exercise. All other current
termination rules continue to apply with respect to retirement, death and
disability.
