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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 6)
------------------------------
DEXTER CORPORATION
(Name of Issuer)
COMMON STOCK, $1.00 PAR VALUE PER SHARE 252165105
(Title of class of securities) (CUSIP number)
RICHARD A. WEINBERG, ESQ.
C/O ISP MANAGEMENT COMPANY, INC.
1361 ALPS ROAD
WAYNE, NEW JERSEY 07470
(973) 628-3000
(Name, address and telephone number of person authorized
to receive notices and communications)
WITH A COPY TO:
STEPHEN E. JACOBS, ESQ.
WEIL, GOTSHAL & MANGES LLP
767 FIFTH AVENUE
NEW YORK, NEW YORK 10153-0119
(212) 310-8000
JANUARY 27, 2000
(Date of event which requires filing of this statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of ss.ss. 240.13d-1(e), 240.13d-1(f) or 240.13d-(g), check the
following box.[ ]
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See ss. 240.13d-7 for other
parties to whom copies are to be sent.
* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purposes of Section 18 of the Securities Exchange Act of
1934 (the "Act") or otherwise subject to the liabilities of that section of the
Act but shall be subject to all other provisions of the Act. (However, see the
Notes.)
(Continued on following pages)
(Page 1 of 9 Pages)
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<PAGE>
<TABLE>
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- ----------------------------------------------------------- --------------------------------------------------------
CUSIP No. 252165105 13D Page 2 of 9 Pages
- ----------------------------------------------------------- --------------------------------------------------------
- ---------------------- -------------------------------------------------------------------------------------------------------
<S> <C>
1 NAME OF REPORTING PERSON ISP OPCO HOLDINGS INC.
S.S. OR I.R.S. IDENTIFICATION NO.
OF ABOVE PERSON
- ---------------------- ------------------------------------------------------------------------------------ ------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [ ]
(b) [X]
- ---------------------- ------------------------------------------------------------------------------------ ------------------
3 SEC USE ONLY
- ---------------------- ------------------------------------------------------------------------------------ ------------------
4 SOURCE OF FUNDS: OO
- ---------------------- ------------------------------------------------------------------------------------ ------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): [ ]
- ---------------------- ------------------------------------------------------------------------------------ ------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Delaware
- ---------------------- ------------------------------------------------------------------------ ------------------------------
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
------------------- ------------------------------------------------ ------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 2,299,200
OWNED BY
------------------- ------------------------------------------------ ------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
------------------- ------------------------------------------------ ------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 2,299,200
- ---------------------- ------------------------------------------------------------------------ ------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON:
2,299,200
- ---------------------- ------------------------------------------------------------------------ ------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: [ ]
- ---------------------- ------------------------------------------------------------------------ ------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 9.98%
- ---------------------- ------------------------------------------------------------------------ ------------------------------
14 TYPE OF REPORTING PERSON: CO
- ---------------------- ------------------------------------------------------------------------ ------------------------------
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<TABLE>
<CAPTION>
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CUSIP No. 252165105 13D Page 3 of 9 Pages
- ----------------------------------------------------------- --------------------------------------------------------
- ---------------------- -------------------------------------------------------------------------------------------------------
<S> <C>
1 NAME OF REPORTING PERSON ISP INVESTMENTS INC.
S.S. OR I.R.S. IDENTIFICATION NO.
OF ABOVE PERSON
- ---------------------- ------------------------------------------------------------------------------------ ------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [ ]
(b) [X]
- ---------------------- ------------------------------------------------------------------------------------ ------------------
3 SEC USE ONLY
- ---------------------- ------------------------------------------------------------------------------------ ------------------
4 SOURCE OF FUNDS: WC, OO
- ---------------------- ------------------------------------------------------------------------------------ ------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): [ ]
- ---------------------- ------------------------------------------------------------------------------------ ------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Delaware
- ---------------------- ------------------------------------------------------------------------ ------------------------------
NUMBER OF 7 SOLE VOTING POWER: 2,299,200
SHARES
------------------- ------------------------------------------------ ------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 0
OWNED BY
------------------- ------------------------------------------------ ------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 2,299,200
REPORTING
------------------- ------------------------------------------------ ------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 0
- ---------------------- ------------------------------------------------------------------------ ------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON:
2,299,200
- ---------------------- ------------------------------------------------------------------------ ------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: [ ]
- ---------------------- ------------------------------------------------------------------------ ------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 9.98%
- ---------------------- ------------------------------------------------------------------------ ------------------------------
14 TYPE OF REPORTING PERSON: CO
- ---------------------- ------------------------------------------------------------------------ ------------------------------
</TABLE>
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<TABLE>
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CUSIP No. 252165105 13D Page 4 of 9 Pages
- ----------------------------------------------------------- --------------------------------------------------------
- ---------------------- -------------------------------------------------------------------------------------------------------
<S> <C>
1 NAME OF REPORTING PERSON INTERNATIONAL SPECIALTY
S.S. OR I.R.S. IDENTIFICATION NO. PRODUCTS INC.
OF ABOVE PERSON
- ---------------------- ------------------------------------------------------------------------------------ ------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [ ]
(b) [X]
- ---------------------- ------------------------------------------------------------------------------------ ------------------
3 SEC USE ONLY
- ---------------------- ------------------------------------------------------------------------------------ ------------------
4 SOURCE OF FUNDS: OO
- ---------------------- ------------------------------------------------------------------------------------ ------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): [ ]
- ---------------------- ------------------------------------------------------------------------------------ ------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Delaware
- ---------------------- ------------------------------------------------------------------------ ------------------------------
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
------------------- ------------------------------------------------ ------------------------------
BENEFICIALLY 8 SHARED VOTING POWER: 2,299,200
OWNED BY
------------------- ------------------------------------------------ ------------------------------
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
------------------- ------------------------------------------------ ------------------------------
PERSON WITH 10 SHARED DISPOSITIVE POWER: 2,299,200
- ---------------------- ------------------------------------------------------------------------ ------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON:
2,299,200
- ---------------------- ------------------------------------------------------------------------ ------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: [ ]
- ---------------------- ------------------------------------------------------------------------ ------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 9.98%
- ---------------------- ------------------------------------------------------------------------ ------------------------------
14 TYPE OF REPORTING PERSON: CO
- ---------------------- ------------------------------------------------------------------------ ------------------------------
</TABLE>
<PAGE>
This Amendment No. 6 ("Amendment No. 6") amends the Statement on
Schedule 13D (the "Schedule 13D") filed on April 22, 1999, as amended by
Amendment No. 1 filed on August 11, 1999, Amendment No. 2 filed on September 8,
1999, Amendment No. 3 filed on September 27, 1999, Amendment No. 4 filed on
December 14, 1999, and Amendment No. 5 ("Amendment No. 5") filed on December 16,
1999, by and on behalf of ISP Opco Holdings Inc. ("ISP Opco"), ISP Investments
Inc. ("ISP Investments") and International Specialty Products Inc. ("ISP" and,
together with ISP Investments, the "ISP Proponents"; and, together with ISP
Opco, the "Reporting Persons") with respect to their ownership of common stock,
par value $1.00 per share (the "Common Stock"), of Dexter Corporation (the
"Company"). Capitalized terms used herein and not defined herein have the
meanings ascribed thereto in the Schedule 13D, as amended.
ITEM 4. PURPOSE OF THE TRANSACTION
On January 27, 2000, Samuel J. Heyman, Chairman of the Board of ISP,
sent the following letter to K. Grahame Walker, Chairman of the Board and Chief
Executive Officer of the Company:
January 27, 2000
Mr. K. Grahame Walker
Chairman and Chief Executive Officer
Dexter Corporation
One Elm Street
Windsor Locks, CT 06096
Dear Grahame:
In view of ISP's $45 all cash offer and our
stated willingness to pay more if additional information justified a
higher price, I was disappointed that your Board did not decide to
encourage negotiations with a view toward maximizing shareholder
value for Dexter shareholders. Its refusal to do so leaves us no
choice but to take our proposal directly to our fellow shareholders.
We are today delivering to your Corporate
Secretary a notice of our intention to present a series of
resolutions at your April Annual Meeting. The effect of the
resolutions is to elect ten of our nominees to the Dexter Board,
including eight directors independent of ISP, who are committed to
considering and pursuing ISP's offer or a superior proposal. We are
also proposing a by-law amendment and a resolution requiring Dexter's
Board to remove its "poison pill" in favor of offers for all shares
of at least $45 per share in cash. We intend to solicit proxies in
favor of these resolutions.
Your December 23rd letter questioned the
seriousness of ISP's intent. First, as you know, ISP currently holds
a stake in Dexter which is more than five times that held by Dexter's
entire Board. Second, so that there should be no doubt as to our
ability to finance the acquisition, Chase Securities Inc. has advised
us, confirmed in writing, that they are highly confident in their
ability to arrange the credit facilities for this acquisition.
5
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There are so many inaccuracies and
mischaracterizations in your letter that I find it difficult to know
where to start. By way of just one example, your heavy reliance upon
security analysts to defend your rejection of our proposal is
misplaced. For instance, in comparing ISP's offer to Dexter's bid
last year for Life Technologies, the Merrill Lynch report contained
an error of almost $300 million by ignoring the value of the minority
interests. Also, you failed to quote a relevant section of the New
Vernon Associates report you cited, which states the following:
"there is little or no interplay between the company's [Dexter's]
industrial and life sciences businesses," "we do find merit in his
[Mr. Heyman's] initiative to separate the company's [Dexter's]
disparate assets," and "in our view Dexter's ownership of LTEK is
constraining the latter company's ability to recruit and retain key
employees." With regard to the last point, it should be made clear
that we indeed view the management of Life Technologies as first
rate. However, your attempted squeeze-out of the minority
shareholders more than a year ago resulted in the elimination of
meaningful stock incentives for Life Technologies executives, which
ultimately impacts the ability to retain and recruit key personnel.
As you know, Life Technologies' shareholders have
rejected Dexter's recent belated $49 per share offer.
Parenthetically, it should be noted that Dexter's own shareholders
appear to have rejected its business strategy as well, as Dexter's
stock price has declined substantially since the company's rejection
of our offer and its decision to attempt to acquire 100% of Life
Technologies. It is apparent from the timing of Dexter's offer for
our Life Technologies shares, coming on the heels of ISP's $45 per
share offer for Dexter, upon which many of Dexter's shareholders have
relied, that Dexter is seeking to divert ISP from a course of action
designed to maximize shareholder values for all Dexter shareholders.
In this connection, we believe that Dexter's attempt to deter us by
providing benefits to ISP not available to other Dexter shareholders
is simply inappropriate.
Grahame, I just do not think it would be
productive at this time to respond to your mischaracterizations and
attempts to impugn our motives - which by the way I do not
appreciate. The real issue here, however, is the maximization of
shareholder value for all Dexter shareholders, and I believe that
shareholders will more likely benefit from a dialogue along this
line. In fact, I would be willing to appear with you before any group
of Dexter shareholders to discuss the merits of Dexter's proposed
course of action vs. ISP's offer.
All the best.
Sincerely,
/s/ Samuel J. Heyman
Samuel J. Heyman
6
<PAGE>
On January 27, 2000, the ISP Proponents delivered a Notice of
Intention to Present Business and Nominations (the "Notice") to the Secretary of
the Company indicating the ISP Proponents' present intent to bring certain
matters before the Company's shareholders at the Company's 2000 annual meeting
of shareholders, including certain amendments to the Company's Bylaws and
nominations of ten persons for election to the Company's Board of Directors. The
text of the specific shareholder resolutions and Bylaw amendments effecting the
ISP Proponents' proposals are contained in Annexes I through VI to the Notice,
which is attached hereto as Exhibit 1.
In addition, on January 27, 2000, the ISP Proponents commenced a
lawsuit against the Company and certain members of the Company's Board of
Directors in the United States District Court for the District of Connecticut.
The ISP Proponents' complaint (the "Complaint") alleges, among other things,
that Article X of the Bylaws (insofar as it provides for a two-thirds
supermajority vote of the shareholders to amend the Bylaws) violates certain
provisions of the Connecticut Business Corporation Act (the "CBCA") and is
therefore invalid; that the Company's poison pill violates certain provisions of
the CBCA and is therefore invalid; that shareholders have the right to vote on
the ISP Proponents' proposals at the Company's 2000 annual meeting of
shareholders; and that the directors have breached their fiduciary obligations
to the Company and its shareholders. The Complaint seeks declaratory and
injunctive relief as well as money damages. The Complaint also asks the Court to
order that the Company's 2000 annual meeting of shareholders be held on or
before April 30, 2000. For a complete description of the ISP Proponents' claims,
please refer to the Complaint, which is attached hereto as Exhibit 2.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
Exhibit No. 1: Form of Notice of Intention to Present Business and
Nominations.
Exhibit No. 2: Form of Complaint.
[The remainder of this page intentionally left blank.]
7
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SIGNATURES
After reasonable inquiry and to the best of their knowledge and
belief, the undersigned certify that the information set forth in this Statement
is true, complete and correct.
Dated: January 27, 2000
ISP OPCO HOLDINGS INC.
ISP INVESTMENTS INC.
INTERNATIONAL SPECIALTY PRODUCTS INC.
By: /s/ Susan B. Yoss
-----------------------------------
Susan B. Yoss
Senior Vice President and Treasurer
8
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EXHIBIT INDEX
Exhibit No. Document Page No.
- ---------- -------- -------
1 Form of Notice of Intention to Present Business and
Nominations.
2 Form of Complaint.
Exhibit 1
INTERNATIONAL SPECIALTY PRODUCTS INC.
ISP INVESTMENTS INC.
c/o ISP Management Company, Inc.
1361 Alps Road
Wayne, New Jersey 07470
January 27, 2000
By Facsimile and Certified Mail
- -------------------------------
Bruce H. Beatt, Esq.
Vice President, General Counsel
and Secretary
Dexter Corporation
One Elm Street
Windsor Locks, Connecticut 06096
Re: Notice of Intention to Present Business and Nominations
-------------------------------------------------------
Dear Mr. Beatt:
The undersigned (the "Proponent"), a wholly owned subsidiary of
International Specialty Products Inc., a Delaware corporation ("ISP"), is a
shareholder of Dexter Corporation, a Connecticut corporation (the "Company"),
and holds of record 100 shares of Common Stock, par value $1.00 per share, of
the Company (the "Common Stock") as of the date hereof. The Proponent and ISP
beneficially own 2,299,200 shares of Common Stock in the aggregate as of the
date hereof. The undersigned hereby notifies the Secretary of the Company in
accordance with Article II, Section 3 of the Company's Bylaws (the "Bylaws")
that at the Company's 2000 Annual Meeting of Shareholders (the "2000 Annual
Meeting") it intends to bring before the 2000 Annual Meeting certain amendments
to the Bylaws and certain other resolutions of the Company's shareholders, as
described herein. In addition, the undersigned hereby notifies the Secretary of
the Company in accordance with Article II, Section 3 of the Bylaws of the
undersigned's intent to nominate at least ten persons for directorships at the
2000 Annual Meeting. As used herein, the term Proponent shall include reference
to ISP.
A. DESCRIPTION OF THE MATTERS TO BE BROUGHT BEFORE THE 2000 ANNUAL
MEETING, THE NOMINATIONS AND THE REASONS THEREFOR
At the 2000 Annual Meeting, the Proponent intends to present and have
voted upon and approved by the shareholders of the Company the following
resolutions (the
NY2:\872330\01\54104.0016
<PAGE>
"Resolutions"), pursuant to the terms of the Company's Restated Certificate of
Incorporation, the Bylaws and the Connecticut Business Corporation Act (the
"CBCA"):
(1) The election of the Proponent's slate of nominees to
replace the three directors whose terms expire at the 2000
Annual Meeting (the "Director Election Proposal");
(2) A Bylaw amendment that would increase the size of the
Company's Board to permit the Proponent's nominees for
directorships, if elected, to constitute a majority of the
Company's Board (the "Board Size Bylaw Proposal") (the
full text of the Bylaw amendment to effect the Board Size
Bylaw Proposal is contained in Annex I to this Notice);
(3) The election of the Proponent's slate of nominees to fill
the vacancies created by the increased number of
directorships (the "Additional Directors Election
Proposal") (the full text of a shareholder resolution to
effect the Additional Directors Election Proposal is
contained in Annex II to this Notice);
(4) A Bylaw amendment that would require the Company's Board
to make certain amendments to the Company's Rights
Agreement, dated as of August 23, 1996, by and between the
Company and ChaseMellon Shareholder Services, L.L.C. (as
amended, the "Rights Agreement"), or to redeem the rights
thereunder, if the shareholders instruct the Board to do
so by majority vote, and not to adopt a new rights
agreement without shareholder approval (the "Poison Pill
Bylaw Proposal") (the complete text of a proposed Bylaw
amendment to effect the Poison Pill Bylaw Proposal is
included as Annex III to this Notice);
(5) A shareholder resolution directing the Company's Board to
amend the Rights Agreement promptly to make it
inapplicable to any offer for all outstanding shares of
the Company for at least $45 per share in cash (the
"Poison Pill Amendment Proposal") (the full text of a
resolution implementing the Poison Pill Amendment Proposal
is included as Annex IV to this Notice);
(6) A shareholder resolution repealing any and all amendments
made by the Company's Board of Directors to the Bylaws
after February 26, 1999 and barring the Company's Board
from adopting any new amendments to the Bylaws which serve
to reinstate any repealed provisions or similar
provisions, without the approval of the shareholders (the
"Bylaw Repeal Proposal") (the complete text of a proposed
shareholder resolution to effect the Bylaw Repeal Proposal
is included as Annex V to this Notice); and
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(7) A resolution providing the order for voting at the 2000
Annual Meeting (the "Omnibus Proposal") (the full text of
the Omnibus Proposal is contained in Annex VI to this
Notice).
The Proponent is proposing the Resolutions to facilitate the
Proponent's proposed offer to acquire all of the Common Stock of the Company not
owned by the Proponent at a price of $45 per share in a merger transaction, a
premium of 38% over the closing price on the day immediately prior to the
announcement of the Proponent's offer. As one of the largest shareholders of
both the Company and Life Technologies, Inc., a Delaware corporation and
majority owned subsidiary of the Company ("LTI"), the Proponent has been
dissatisfied with the failure of the Company's Board of Directors to maximize
shareholder value. On December 3, 1999, the Proponent discussed with
representatives of the Company strategies aimed at maximizing the value of the
Company's shares. After receiving no response to these proposals, in
correspondence with the Company on December 14, 1999, the Proponent proposed a
business combination transaction in which holders of the Company's Common Stock
would receive $45 per share, subject to the execution of a mutually acceptable
merger agreement. The Proponent also stated that it would be willing to pay more
for the shares if the Company's Board provided additional information that
justifies an increased price. By correspondence with the Proponent on December
23, 1999, the Company's Board rejected the Proponent's proposal. The Proponent
does not believe that the Company's Board is willing to consider in good faith
and pursue the proposed combination or a superior proposal, absent direct
pressure from the Proponent and other shareholders.
The overall purpose of the Proponent's proposals is to elect nominees
to the Company's Board who are committed to consider and pursue the Proponent's
proposed business combination in which the Company's shareholders would receive
$45 per share in cash, or a superior proposal. All determinations made by the
Proponent's nominees, if elected as directors of the Company, will be subject to
their fiduciary duties. Two of the Proponent's nominees, Samuel J. Heyman and
Sunil Kumar, are affiliated with the Proponent and, if elected to the Company's
Board, would not participate in any Board action relating to the Proponent's
proposal or any other business combination transaction while the Proponent's
acquisition proposal remains in effect. Another purpose of the Proponent's
proposals is to permit the Company's shareholders to consider on their own the
merits of any offers for their shares by issuing instructions to the Company's
Board as to the manner in which the Company's Rights Agreement shall be applied
to particular offers or transactions and by directing the Company's Board to
make the Rights Agreement inapplicable to offers of at least $45 per share in
cash for all shares of Common Stock.
VOTE REQUIRED
Based on currently available public information, a quorum will exist
at the 2000 Annual Meeting if holders of not less than a majority of the shares
of Common Stock outstanding and entitled to vote at the 2000 Annual Meeting are
present in person
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or by proxy. If a quorum is present, the Proponent's proposals can be adopted by
the following vote:
o NOMINEE PROPOSALS: Election of nominees for directorships will
require the affirmative vote of a plurality of the votes cast. The
election of the Proponent's nominees to fill the newly-created
directorships is subject to the prior adoption of the Proponent's
Board Size Bylaw Proposal.
o PROPOSALS REQUIRING BYLAW AMENDMENTS: The Proponent believes that the
Resolutions involving amendments to the Bylaws, namely the Board Size
Bylaw Proposal, Poison Pill Bylaw Proposal and Bylaw Repeal Proposal,
will be approved if the votes cast for the respective proposal exceed
the votes cast against the respective proposal at the 2000 Annual
Meeting. The Proponent is instituting litigation seeking to have the
amendment provision currently contained in the Bylaws, to the extent
it requires the affirmative supermajority vote of the holders of
two-thirds of the issued and outstanding shares of Common Stock to
effect an amendment, held ineffective. If the Bylaws are held to
contain an effective supermajority shareholder voting requirement,
the Board Size Bylaw Proposal, Poison Pill Bylaw Proposal and Bylaw
Repeal Proposal would each require the affirmative vote of the
holders of two-thirds of the issued and outstanding shares of Common
Stock.
o PROPOSALS NOT REQUIRING BYLAW AMENDMENTS: Adoption of the Poison Pill
Amendment Proposal and Omnibus Proposal will be approved if the votes
cast for the respective proposal exceed the votes cast against the
respective proposal at the 2000 Annual Meeting. The adoption of the
Poison Pill Amendment Proposal is subject to the adoption of the
Poison Pill Bylaw Proposal.
B. INFORMATION REGARDING THE NOMINEES
As stated above, the Proponent is hereby providing notice of its
intent to nominate the following persons as candidates to stand for election to
the Board of Directors of the Company (the "Nominees"):
(1) Samuel J. Heyman
(2) Sunil Kumar
(3) Philip Peller
(4) Alan Meckler
(5) Dan Ogden
(6) Morrison DeSoto Webb
(7) Robert Englander
4
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(8) John Droney
(9) Anthony T. Kronman
(10) Vincent Tese
It is the Proponent's intention that Nominees (1), (2) and (3) stand
for election to replace the directors whose terms expire at the 2000 Annual
Meeting and serve until the 2003 Annual Meeting. If the Company's Board fixes
the number of nominees to be elected for terms expiring in 2003 at other than
three, the Proponent shall adjust the designation of its Nominees accordingly.
The remaining Nominees listed above shall stand for election to fill the newly
created directorships resulting from the adoption by the Company's shareholders
of the Board Size Bylaw Proposal.
In accordance with Article II, Section 3 of the Bylaws, set forth
below is the following information regarding these nominations: (1) with respect
to each Nominee: (a) consent of each Nominee to his nomination; (b) name, age,
business address and residence address of each Nominee; (c) the principal
occupation or employment of each Nominee; (d) the class and total number of
shares of Common Stock that are beneficially owned by each Nominee as of the
date of this Notice of Intention to Present Business and Nominations; and (e)
such other information regarding each Nominee as would be required to be
included in a Proxy Statement on Schedule 14A under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), in connection with the solicitation of
proxies for the election of the Nominees as directors of the Company; and (2)
with respect to the Proponent: (a) name and record address of the Proponent; (b)
the class and total number of shares of Common Stock that are beneficially owned
by the Proponent as of the date of this Notice of Intention to Present Business
and Nominations; (c) a representation of the Proponent that it intends to appear
in person or by proxy at the 2000 Annual Meeting to nominate the Nominees; (d) a
description of all arrangements or understandings between the Proponent and each
Nominee and any other person or persons (naming such person or persons) pursuant
to which the nominations are to be made by the Proponent; and (e) such other
information regarding the Proponent as would be required to be included in a
Proxy Statement on Schedule 14A under the Exchange Act, in connection with the
solicitation of proxies for the election of the Nominees as directors of the
Company.
1. CONSENTS OF EACH NOMINEE TO NOMINATION
--------------------------------------
See Exhibits 1-A through 1-J hereto.
2. NAME, AGE, BUSINESS ADDRESS AND RESIDENCE ADDRESS
-------------------------------------------------
<TABLE>
<CAPTION>
Name Age Business Address Residence Address
- ---- --- ---------------- -----------------
<S> <C> <C> <C>
Samuel J. Heyman 61 1361 Alps Road 2 East 67th Street
Wayne, New Jersey 07470 New York, NY 10021
5
<PAGE>
<S> <C> <C> <C>
Sunil Kumar 50 1361 Alps Road 301 Westgate Road
Wayne, New Jersey 07470 Ridgewood, New Jersey 07450
Philip Peller 60 N/A (retired) 9 Quaker Ridge Road
Brookville, NY 11545-3327
Alan Meckler 54 501 Fifth Avenue 520 East 86th Street
New York, NY 10017 New York, NY 10028
Dan Ogden 52 Yokohama Tire Corporation 10541 N. 50th Place
601 S. Acacia Paradise Valley, AZ 85253
P.O. Box 4550
Fullerton, CA 92834-4550
Morrison DeSoto Webb 52 120 Rye Ridge Road 120 Rye Ridge Road
Harrison, NY 10528 Harrison, NY 10528
Robert Englander 57 Belvoir Publications, Inc. 970 Park Avenue
75 Holly Hill Lane New York, NY 10028
Greenwich, CT 06830
John Droney 53 Levy & Droney, P.C. 75 Rockledge Drive
74 Batterson Park Road West Hartford, CT 06107
Farmington, CT 06032
Anthony T. Kronman 54 Yale Law School 35 Highland Street
127 Wall Street New Haven, CT 06511
New Haven, CT 06511
Vincent Tese 56 Wireless Cable International, Inc. 130 East 74th Street
c/o Bear Stearns & Co. Inc. New York, NY 10021
245 Park Avenue
New York, NY 10167
3. PRINCIPAL OCCUPATIONS
---------------------
Name Principal Occupation
- ---- --------------------
<S> <C>
Samuel J. Heyman Chairman of the Board of Directors of International Specialty Products Inc.
6
<PAGE>
<S> <C>
Sunil Kumar President, Chief Executive Officer and Director of International Specialty Products Inc.
Philip Peller Retired as of November 30, 1999.
Alan Meckler Chairman of the Board of Directors and Chief Executive Officer of Internet.com Corp.
Dan Ogden President and Chief Operating Officer of Yokohama Tire Corporation
Morrison DeSoto Webb Attorney in private practice
Robert Englander Chairman of the Board and Chief Executive Officer of Belvoir Publications, Inc.
John Droney Attorney at Levy & Droney, P.C.
Anthony T. Kronman Dean and Edward J. Phelps Professor of Law of Yale Law School
Vincent Tese
Chairman of the Board of Wireless Cable International Inc.
</TABLE>
4. CLASS AND NUMBER OF SHARES BENEFICIALLY OWNED BY EACH
NOMINEE AS OF THE DATE OF THIS NOTICE
-----------------------------------------------------
The class of shares of the Company's capital stock beneficially owned
by each of the persons listed below as of the date of this Notice is Common
Stock.
Number of Shares
Name Beneficially Owned
- ---- ------------------
Samuel J. Heyman 2,229,200
Sunil Kumar 0
Philip Peller 0
Alan Meckler 0
Dan Ogden 0
Morrison DeSoto Webb 0
Robert Englander 0
John Droney 0
Anthony T. Kronman 0
Vincent Tese 0
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5. OTHER INFORMATION REQUIRED BY THE PROXY RULES REGARDING
EACH NOMINEE
-------------------------------------------------------
Other information regarding each Nominee that would be required to be
included in a Proxy Statement on Schedule 14A under the Exchange Act in
connection with the solicitation of proxies for the election of the Nominees is
set forth below. Please see Annex VII hereto for additional information
regarding the Nominees required by Regulation 14A under the Exchange Act.
Item 5 - Interests of Certain Persons in Matters to be
Acted Upon
------------------------------------------------------
(b) See Sections B.2. and B.3. above and Annex VII
hereto.
Item 6 - Voting Securities and Principal Holders Thereof
--------------------------------------------------------
(d) The information required by Item 403 of Regulation S-K
with respect to each such Nominee is set forth in Section B.4. above and Annex
VII hereto.
Item 7 - Directors and Executive Officers
-----------------------------------------
(a) The information required by Instruction 4 to Item 103
of Regulation S-K with respect to each such Nominee is set forth below:
Except as set forth below, no such Nominee is involved in
any material pending legal proceedings with respect to the Company:
The Proponent is commencing a lawsuit against the Company
and certain members of the Company's Board of Directors in the United States
District Court for the District of Connecticut. The Proponent's complaint (the
"Complaint") alleges, among other things, that Article X of the Bylaws (insofar
as it provides for a two-thirds supermajority vote of the shareholders to amend
the Bylaws) violates Section 33-807 of the CBCA and is therefore invalid; that
the Company's poison pill violates Section 33-665 of the CBCA and is therefore
invalid; that shareholders have the right to vote on the Proponent's proposals
at the 2000 Annual Meeting; and that the directors have breached their fiduciary
obligations to the Company and its shareholders. The Complaint seeks declaratory
and injunctive relief as well as money damages. The Complaint also asks the
Court to order that the 2000 Annual Meeting be held no later than April 30,
2000. The Proponent refers to the Complaint for a complete description of its
claims.
8
<PAGE>
(b) The Information required by Items 401, 404(a) and (c)
and 405 of Regulation S-K with respect to each such Nominee is set forth below:
Item 401:
---------
(a) Identification of Directors. The names and
ages of the Nominees who are not directors of the Company
as of the date hereof are set forth above under Section
B.2. above, and any arrangement or understanding between
any such Nominee and any other person pursuant to which he
was or is to be selected as a Nominee or director is set
forth above under Section C.4. below. None of the Nominees
currently holds any position or office with the Company or
has ever served previously as a director of the Company.
If elected, Samuel J. Heyman, Sunil Kumar and Philip
Peller would serve, subject to the provisions of the
Bylaws, until the 2003 annual meeting of the Company's
shareholders and until their respective successors have
been elected and qualified. If elected, Alan Meckler, Dan
Ogden, Morrison DeSoto Webb and Robert Englander would
serve, subject to the provisions of the Bylaws, until the
2002 annual meeting of the Company's shareholders and
until their respective successors have been elected and
qualified, and John Droney, Anthony T. Kronman and Vincent
Tese, if elected, would serve, subject to the provisions
of the Bylaws, until the 2001 annual meeting of
shareholders and until their respective successors have
been elected and qualified, subject, in each case, to the
allocation by the Company's Board of such directorships to
a different class, consistent with Section 33-740 of the
CBCA.
(e) Business Experience. The business
experience of each of the Nominees during the past five
years is as follows:
Name Business Experience During Past Five Years
- ---- ------------------------------------------
Samuel J. Heyman Mr. Heyman has been a director and Chairman of
ISP since its formation and served as its Chief
Executive Officer from its formation until June
1999. He also has been a director, Chairman and
Chief Executive Officer of GAF Corporation
("GAF") and certain of its subsidiaries for
more than five years. Mr. Heyman has been a
director and Chairman of Building Materials
Corporation of America ("BMCA"), an indirect,
approximately 97% -owned subsidiary of GAF,
since its formation, and has served as Chief
Executive Officer of BMCA since June 1999,
which position he also held from June 1996 to
January 1999. He is also the Chief Executive
Officer, Manager and General Partner of a
number of closely held real estate development
companies and partnerships whose investments
include commercial real estate and a portfolio
of publicly traded securities.
9
<PAGE>
Sunil Kumar Mr. Kumar has been a director, President and
Chief Executive Officer of ISP since June 1999.
Mr. Kumar also has been President and Chief
Executive Officer of certain subsidiaries of
ISP, including ISP Investments Inc., since June
1999. Mr. Kumar was a director, President and
Chief Executive Officer of BMCA from May 1995,
January 1999 and July 1996, respectively, until
June 1999. He was Chief Operating Officer of
BMCA from March 1996 to January 1999. Mr. Kumar
also was President, Commercial Roofing Products
Division, and Vice President of BMCA from
February 1995 to March 1996. From 1992 to
February 1995, he was Executive Vice President
of Bridgestone/Firestone, Inc., a retail
distributor and manufacturer of tires and
provider of automobile services.
Philip Peller Prior to his retirement on November 30, 1999,
Mr. Peller was a partner of Andersen Worldwide
S.C. and Arthur Andersen LLP, a role he had
held since 1970. He served as Managing Partner
- Practice Protection and Partner Affairs for
Andersen Worldwide during the period 1998 to
1999 and as Managing Partner - Practice
Protection from 1996 to 1998. During the period
1995 to 1996, he was the Managing Director -
Quality, Risk Management and Professional
Competence for Arthur Andersen's global audit
practice.
Alan Meckler Mr. Meckler has been the Chairman and Chief
Executive Officer of Internet.com Corp. since
December 1998. He was the Chairman and Chief
Executive Officer of Mecklermedia Corp. from
June 1971 to November 30, 1998.
Dan Ogden Mr. Ogden has been the President and Chief
Operating Officer of Yokohama Tire Corporation
since August 1997. From September 1996 until
August 1997, Mr. Ogden was engaged in private
investment activities. He was President and
Chief Operating Officer of EMCO Enterprises,
Inc. from December 1992 until August 1996.
Morrison DeSoto Webb Mr. Webb has been an attorney in private
practice since January 2000. He was Executive
Vice President - External Affairs and Corporate
Communications at Bell Atlantic Corporation
from August 1997 until December 1999. From May
1995 until August 1997, Mr. Webb was Executive
Vice President, General Counsel and Secretary
of NYNEX Corporation.
10
<PAGE>
He was Vice President - General Counsel of New
England Telephone and Telegraph Company, a
subsidiary of NYNEX Corporation, from 1991
until 1995 and Vice President - General Counsel
of New York Telephone Company, a subsidiary of
NYNEX Corporation from 1994 until 1995.
Robert Englander Mr. Englander has been the Chairman and Chief
Executive Officer of Belvoir Publications since
February 1973.
John Droney Mr. Droney has been an attorney with Levy &
Droney, P.C. since February 1988. Mr. Droney
was also Chairman of the Democratic Party in
Connecticut and a member of the Democratic
National Committee from 1986-1992.
Anthony T. Kronman Mr. Kronman has been Dean and Professor of Law
at Yale Law School since 1994 and 1978,
respectively.
Vincent Tese Mr. Tese has been the Chairman of Wireless
Cable International Inc. since April 1995. Mr.
Tese was Chairman of Cross Country Wireless
Inc. from October 1994 to July 1995. Mr. Tese
was the Director of Economic Development for
the State of New York from June 1987 to
December 1994 and also served as the Chairman
of the Urban Development Corporation in New
York from 1985 to 1994.
Other than as set forth immediately below, none
of the Nominees is a director of any company with a class
of securities registered pursuant to Section 12 of the
Exchange Act or subject to the requirements of Section
15(d) thereof, or any registered investment company under
the Investment Company Act of 1940:
Samuel J. Heyman is a director of International
Specialty Products Inc. and Building Materials
Corporation of America.
Sunil Kumar is a director of International
Specialty Products Inc.
Alan Meckler is a director of Internet.com
Corporation.
Vincent Tese is a director of Allied Waste
Industries, Inc., Bear Stearns Companies Inc.,
Bowne & Co., Inc., Cablevision Systems Corp.,
Keyspan Corp. and Mack-Cali Realty Corp.
(f) Involvement in Certain Legal Proceedings.
None of the Nominees has been the subject of any order,
action or proceeding of the type described in Item 401(f).
11
<PAGE>
Item 404(a):
------------
Other than as set forth immediately below,
since the beginning of the Company's 1999 fiscal year,
none of the Nominees or any member of their immediate
families had any material interest in a transaction, or
has any material interest in a proposed transaction, to
which the Company or any subsidiary of the Company was a
party and in which the amount involved exceeded $60,000:
The Proponent and certain of its affiliates
beneficially own approximately 14% of the outstanding
shares of common stock of LTI (the "LTI Common Stock").
Samuel J. Heyman, by virtue of his beneficial ownership
(as defined in Rule 13d-3) of approximately 76% of the
capital stock of ISP, may be deemed to own beneficially
(solely for purposes of Rule 13d-3) the LTI Common Stock
owned by the Proponent and such affiliates. Mr. Heyman has
no knowledge of the commercial dealings between the
Company and LTI, other than information that may be
disclosed in the public filings of the Company and LTI.
Item 404(c):
------------
None of the Nominees or any member of their
immediate families has been indebted to the Company or any
of its subsidiaries at any time since the beginning of the
Company's 1999 fiscal year in an amount in excess of
$60,000.
Item 405:
---------
Not applicable.
(c) The information required by Item 404 (b) of Regulation
S-K with respect to each such Nominee is set forth below:
None of the Nominees has or has had during the Company's
1999 fiscal year any relationship with the Company or its subsidiaries of the
type described in Item 404(b) of Regulation S-K.
Item 8 - Compensation of Directors and Executive Officers
---------------------------------------------------------
The information required by Item 402 of Regulation S-K with
respect to each such Nominee and their associates is set forth below:
No Nominee has received any compensation from the Company.
12
<PAGE>
C. INFORMATION REGARDING THE PROPONENT
1. NAME AND RECORD ADDRESS OF THE PROPONENT
----------------------------------------
Name Record Address
- ---- --------------
ISP Investments Inc. 1361 Alps Road
Wayne, New Jersey 07470
2. THE CLASS AND NUMBER OF SHARES BENEFICIALLY OWNED BY THE
PROPONENT AS OF THE DATE OF THIS NOTICE
--------------------------------------------------------
The class of shares of the Company's capital stock
beneficially owned by the persons listed below as of the date of this Notice is
Common Stock.
Number of Shares
Name Beneficially Owned
- ---- ------------------
ISP Investments Inc. 2,229,200
3. REPRESENTATION OF THE PROPONENT
-------------------------------
By executing this Notice of Intention to Present Business
and Nominations, the Proponent thereby represents that the Proponent intends to
appear in person or by proxy at the 2000 Annual Meeting to nominate the
Proponent's nominees.
4. DESCRIPTION OF ALL ARRANGEMENTS BETWEEN THE PROPONENT AND
THE NOMINEES AND OTHER PERSONS PURSUANT TO WHICH
NOMINATIONS ARE BEING MADE
---------------------------------------------------------
Each of the Proponent's Nominees (other than Samuel J.
Heyman and Sunil Kumar) will receive a stipend of $50,000 for his service as a
Nominee. This stipend is not refundable in any manner in connection with the
outcome of the Proponent's proxy solicitation or otherwise.
Each of the Proponent's Nominees is a party to an indemnity
agreement with ISP (each, a "Director Indemnity Agreement" and collectively, the
"Director Indemnity Agreements"). In accordance with the terms of the Director
Indemnity Agreements, ISP has agreed to indemnify and hold harmless each of the
Proponent's Nominees from and against, among other things, all expenses,
liabilities and losses, including reasonable attorneys' fees, related to any
action, suit or proceeding to which such Nominee is made a party or threatened
to be made a party by reason of such Nominee's action or inaction while serving
as one of the Proponent's Nominees.
13
<PAGE>
5. OTHER INFORMATION REQUIRED BY THE PROXY RULES REGARDING
THE PROPONENT
-------------------------------------------------------
Such other information regarding the Proponent as would be
required to be included in a Proxy Statement on Schedule 14A under the Exchange
Act in connection with the solicitation of proxies for the adoption of the
Proponent's proposals described herein and the election of the Proponent's
nominees is set forth on Annex VII hereto. Please see Annex VII hereto and
Section B. above for additional information regarding the Proponent required by
Regulation 14A under the Exchange Act.
* * *
14
<PAGE>
The Proponent requests written notice as soon as practicable, but in
no event later than February 4, 2000, of any alleged defect in this Notice of
Intention to Present Business and Nominations and reserves the right, following
receipt of any such notice, to either challenge, or attempt as soon as
practicable to cure, such alleged defect. The Proponent reserves the right to
give further notice of additional business or nominations to be conducted or
made at the 2000 Annual Meeting or other meeting of the Company's shareholders,
to revise the proposals or nominations describe herein, or not to present any
one or more of the proposals or nominations described herein.
The Proponent agrees to furnish such other information with respect
to the Nominees as may reasonably be required by the Company to determine the
eligibility of any such Nominee to serve as a director of the Company.
Nothing herein shall be deemed to be an admission that the Proponent,
the Nominees or the beneficial owners of any of the shares of Common Stock held
of record by any participants in any proxy solicitation by the Proponent
pursuant to Regulation 14A under the Exchange Act, constitute a "group" within
the meaning of Section 13(d) of the Securities Exchange Act of 1934, as amended,
or the rules and regulations thereunder or of any provision of the CBCA.
Please direct any questions regarding the information contained in
this Notice of Intention to Present Business and Nominations to Richard A.
Weinberg, Esq., c/o ISP Management Company, Inc., 1361 Alps Road, Wayne, New
Jersey 07470, (973) 628-3000 (Phone), (973) 628-3229 (Facsimile), with a copy to
Stephen E. Jacobs, Esq., Weil, Gotshal & Manges LLP, 767 Fifth Avenue, New York,
New York 10153, (212) 310-8320 (Phone), (212) 310-8007 (Facsimile).
In witness whereof, the Proponent has caused this Notice of Intention
to Present Business and Nominations to be duly executed on this 27th day of
January, 2000.
INTERNATIONAL SPECIALTY PRODUCTS INC.
ISP INVESTMENTS INC.
By: /s/ Susan B. Yoss
----------------------------------
Name: Susan B. Yoss
Title: Senior Vice President and Treasurer
15
<PAGE>
ANNEX I
BOARD SIZE BYLAW PROPOSAL
RESOLVED, that the Bylaws of Dexter Corporation be, and they hereby
are, amended, effective at the time this resolution is approved by the
shareholders of Dexter Corporation, by:
1. deleting the fourth sentence of Article III, Section 1, which reads
"[e]ach class of directorships shall consist of not less than one nor
more than five directorships", in its entirety;
2. adding a new fourth sentence of Article III, Section 1 as follows:
"At the annual meeting of the shareholders of the corporation held in
2000, additional directors shall be elected so that the Board of
Directors shall consist of seventeen directorships. The additional
directorships thereby created shall be allocated to the classes with
terms expiring at the annual meeting of the shareholders of the
corporation to be held in 2001 or 2002, unless allocated to a
different class by the Board of Directors consistent with Section
33-740 of the Connecticut Business Corporation Act"; and
3. adding a new final sentence of Article III, Section 1 as follows:
"The fourth sentence of this Section 1 may be altered, amended or
repealed only with the approval of the shareholders of the corporation
entitled to vote thereon in the manner set forth in Section 33-709(c)
of the Connecticut Business Corporation Act."
16
<PAGE>
ANNEX II
THE ADDITIONAL DIRECTORS ELECTION PROPOSAL
RESOLVED, that each of the following persons be elected a director of
Dexter Corporation to fill the new directorships on the Board of Directors of
Dexter Corporation resulting from the adoption of the resolution amending
Article III, Section 1 of the Bylaws to increase the size of the Board, for a
term commencing at the time this resolution is adopted by the shareholders of
Dexter Corporation and shall be allocated into classes with terms continuing
until the annual meeting of the shareholders of Dexter Corporation to be held in
the year indicated below, and until the election and qualification of his
respective successor or until his earlier resignation or removal:
Alan Meckler 2002
Dan Ogden 2002
Morrison DeSoto Webb 2002
Robert Englander 2002
John Droney 2001
Anthony T. Kronman 2001
Vincent Tese 2001
; provided, that the Board of Directors may instead allocate certain of such
directorships to a different class, consistent with Section 33-740 of the
Connecticut Business Corporation Act.
17
<PAGE>
ANNEX III
THE POISON PILL BYLAW PROPOSAL
RESOLVED, that the Bylaws of Dexter Corporation be, and they hereby
are, amended, effective at the time this resolution is approved by the
shareholders of Dexter Corporation, by adding the following Section 7 to the end
of Article II:
"Section 7. Rights Agreements.
-----------------
The Board of Directors, in exercising its rights
and duties with respect to the administration of the Rights
Agreement, dated as of August 23, 1996, as amended, by and
between the corporation and ChaseMellon Shareholder
Services L.L.C., as Rights Agent (the "Rights Agreement")
will carry out a resolution authorizing (i) the partial or
complete redemption of the rights issued pursuant to the
Rights Agreement (the "Rights"), or (ii) an amendment to
the Rights Agreement making the Rights inapplicable to
offers or transactions or types of offers or transactions
specified in such resolution, if such resolution is
authorized and approved by the shareholders of the
corporation entitled to vote thereon in the manner set
forth in Section 33-709(c) of the Connecticut Business
Corporation Act. In addition, the Board of Directors shall
not adopt any new shareholder rights plan, rights agreement
or any other form of "poison pill" which is designed to or
has the effect of making acquisitions of large holdings of
the corporation's shares of capital stock more difficult or
expensive, unless such plan is first approved by the
shareholders of the corporation entitled to vote thereon in
the manner set forth in Section 33-709(c) of the
Connecticut Business Corporation Act. This Section 7 may be
altered, amended or repealed only with the approval of the
shareholders of the corporation entitled to vote thereon in
the manner set forth in Section 33-709(c) of the
Connecticut Business Corporation Act."
18
<PAGE>
ANNEX IV
THE POISON PILL AMENDMENT PROPOSAL
RESOLVED, that the shareholders of Dexter Corporation hereby exercise
their right under Article II, Section 7 of the Bylaws of Dexter Corporation, as
amended on the date hereof, to require the Board of Directors to promptly amend
the Rights Agreement, dated as of August 23, 1996, as amended, by and between
Dexter Corporation and ChaseMellon Shareholder Services, L.L.C. (the "Rights
Agreement") to provide that the acquisition of beneficial ownership of shares of
common stock, par value $1.00 per share, of Dexter Corporation ("Common Stock")
pursuant to any offer for all outstanding shares of Common Stock for
consideration of at least $45 per share net to the seller in cash, shall
constitute a "Qualifying Offer" within the meaning of Sections 11(a)(ii) and
13(d) of the Rights Agreement.
19
<PAGE>
ANNEX V
THE BYLAW REPEAL PROPOSAL
RESOLVED, that any and all amendments made by the Board of Directors
of Dexter Corporation to the Bylaws of Dexter Corporation on or after February
26, 1999, be, and the same hereby are, repealed, and that, without the approval
of the shareholders of Dexter Corporation, the Board of Directors may not
thereafter amend any section of the Bylaws affected by such repeal or adopt any
new Bylaw provision which serves to reinstate any repealed provisions or any
similar provisions.
20
<PAGE>
ANNEX VI
THE OMNIBUS PROPOSAL
RESOLVED, that each of the proposals of International Specialty
Products Inc. and ISP Investments Inc. shall be voted upon by the shareholders
of Dexter Corporation at the 2000 Annual Meeting in the following order:
1. This Omnibus Proposal;
2. The Bylaw Repeal Proposal;
3. The Director Election Proposal;
4. The Board Size Bylaw Proposals;
5. The Additional Directors Election Proposal;
6. The Poison Pill Bylaw Proposal; and
7. The Poison Pill Amendment Proposal.
21
<PAGE>
ANNEX VII
INFORMATION CONCERNING CERTAIN DIRECTORS,
OFFICERS, EMPLOYEES AND OTHER
REPRESENTATIVES OF THE PROPONENT
Information is being given herein for (i) International Specialty
Products Inc., a Delaware corporation ("ISP"), (ii) ISP Investments Inc., a
Delaware corporation (together with ISP, the "Proponents"), (iii) Samuel J.
Heyman, a natural person and nominee for the Board of Directors of the Company
("Heyman"), (iv) Sunil Kumar, a natural person and nominee for the Board of
Directors of the Company ("Kumar"), (v) Philip Peller, a natural person and
nominee for the Board of Directors of the Company ("Peller"), (vi) Alan Meckler,
a natural person and nominee for the Board of Directors of the Company
("Meckler"), (vii) Dan Ogden, a natural person and nominee for the Board of
Directors of the Company ("Ogden"), (viii) Morrison DeSoto Webb, a natural
person and nominee for the Board of Directors of the Company ("Webb"), (ix)
Robert Englander, a natural person and nominee for the Board of Directors of the
Company ("Englander"), (x) John Droney, a natural person and nominee for the
Board of Directors of the Company ("Droney"), (xi) Anthony T. Kronman, a natural
person and nominee for the Board of Directors of the Company ("Kronman"), and
(xii) Vincent Tese, a natural person and nominee for the Board of Directors of
the Company ("Tese"), who are each a "participant in a solicitation" as defined
under the proxy rules (collectively, the "Participants").
Information is also given for each of the entities listed on Schedule
A to this Annex VII, each of which is an "associate", as defined under the proxy
rules, of the Proponents.
Each of the Proponents is a Delaware corporation. Each of the
Proponents has its principal place of business at 300 Delaware Avenue,
Wilmington, Delaware 19801. The address of each of the entities listed on
Schedule A to this Annex VII is c/o ISP Management Company, Inc., 1361 Alps
Road, Wayne, New Jersey 07470.
The Participants may be deemed to have beneficial ownership of the
Company's Common Stock and the common stock, par value $.01 per share ("LTI
Common Stock"), of Life Technologies, Inc. ("LTI") as set forth immediately
below. Except as set forth below, no associates of any of the Participants owns
any Common Stock or LTI Common Stock.
22
<PAGE>
<TABLE>
<CAPTION>
APPROXIMATE MARGIN
NUMBER OF SHARES OF THE NUMBER OF SHARES INDEBTEDNESS WITH RESPECT
NAME COMPANY'S COMMON STOCK OF LTI'S COMMON STOCK TO COMMON STOCK
- ---- ---------------------- --------------------- ---------------
<S> <C> <C> <C>
ISP Investments Inc. 2,299,200 3,384,600 (5)
(direct ownership)(1) (direct/indirect ownership)(2)(3)
ISP Opco Holdings Inc. 2,299,200 3,384,600 (5)
(indirect ownership)(1) (indirect ownership)(2)(3)
ISP Ireland 0 452,000 (5)
(direct ownership)(3)
International Specialty 2,299,200 3,506,270 (5)
Products Inc. (indirect ownership)(1) (direct/indirect ownership)(2)(3)(4)
Samuel J. Heyman 2,299,200 3,506,270 (5)
(indirect ownership)(1) (indirect ownership)(2)(3)(4)
Sunil Kumar 0 0 $ 0
Philip Peller 0 0 $ 0
Alan Meckler 0 0 $ 0
Dan Ogden 0 0 $ 0
Morrison DeSoto Webb 0 0 $ 0
Robert Englander 0 0 $ 0
John Droney 0 0 $ 0
Anthony T. Kronman 0 0 $ 0
Vincent Tese 0 0 $ 0
</TABLE>
23
<PAGE>
(1) The Proponent has the sole power to vote, direct the voting of,
dispose of and direct the disposition of the Common Stock. ISP Opco
Holdings Inc. ("ISP Opco"), by virtue of its indirect ownership of
all of the outstanding capital stock of the Proponent, may be deemed
to own beneficially (solely for purposes of Rule 13d-3) the Common
Stock owned by the Proponent. International Specialty Products Inc.
("ISP"), by virtue of its ownership of all of the outstanding common
stock of ISP Opco, may be deemed to own beneficially (solely for
purposes of Rule 13d-3) the Common Stock owned by the Proponent. Mr.
Heyman, by virtue of his beneficial ownership (as defined in Rule
13d-3) of approximately 76% of the capital stock of ISP, may be
deemed to own beneficially (solely for purposes of Rule 13d-3) the
Common Stock owned by the Proponent.
(2) The Proponent has the sole power to vote, direct the voting of,
dispose of and direct the disposition of 2,932,600 shares of LTI
Common Stock. ISP Opco, by virtue of its indirect ownership of all of
the outstanding capital stock of the Proponent, may be deemed to own
beneficially (solely for purposes of Rule 13d-3) all of the LTI
Common Stock owned by the Proponent. ISP, by virtue of its ownership
of all of the outstanding common stock of ISP Opco, may be deemed to
own beneficially (solely for purposes of Rule 13d-3) the LTI Common
Stock owned by the Proponent. Mr. Heyman, by virtue of his beneficial
ownership (as defined in Rule 13d-3) of approximately 76% of the
capital stock of ISP, may be deemed to own beneficially (solely for
purposes of Rule 13d-3) the LTI Common Stock owned by the Proponent.
(3) ISP Ireland has the sole power to vote, direct the voting of, dispose
of and direct the disposition of 452,000 shares of LTI Common Stock.
The Proponent, by virtue of its indirect ownership of all of the
outstanding capital stock of ISP Ireland, may be deemed to own
beneficially (solely for purposes of Rule 13d-3) all of the LTI
Common Stock owned by ISP Ireland. ISP Opco, by virtue of its
indirect ownership of all of the outstanding capital stock of the
Proponent, may be deemed to own beneficially (solely for purposes of
Rule 13d-3) all of the LTI Common Stock owned by ISP Ireland. ISP, by
virtue of its ownership of all of the outstanding common stock of ISP
Opco, may be deemed to own beneficially (solely for purposes of Rule
13d-3) the LTI Common Stock owned by ISP Ireland. Mr. Heyman, by
virtue of his beneficial ownership (as defined in Rule 13d-3) of
approximately 76% of the capital stock of ISP, may be deemed to own
beneficially (solely for purposes of Rule 13d-3) the LTI Common Stock
owned by ISP Ireland.
(4) ISP has the sole power to vote, direct the voting of, dispose of and
direct the disposition of 121,670 shares of LTI Common Stock. Mr.
Heyman, by virtue of his beneficial ownership (as defined in Rule
13d-3) of approximately 76% of the capital stock of ISP, may be
deemed to own beneficially (solely for purposes of Rule 13d-3) the
LTI Common Stock owned by ISP.
(5) In the ordinary course of its business, ISP Investments Inc.
purchases securities for its investment portfolio with funds obtained
from the working capital of ISP Investments, loans from affiliates
and borrowings pursuant to standard margin arrangements.
Other than as set forth immediately below, to the best of the
knowledge of the Participants and their associates, none has been, within the
past year, a party to any contract, arrangement or understanding with any person
with respect to any securities of the Company, including but not limited to
joint ventures, loan or option arrangements, puts or calls, guarantees against
loss or guarantees of profits, division of losses or profits, or the giving or
withholding of proxies:
On November 25, 1998, ISP entered into an agreement (the "Group
Agreement") with certain other persons with respect to such parties' ownership
of LTI
24
<PAGE>
Common Stock. Pursuant to the terms of the Group Agreement, ISP and the other
parties thereto agreed (i) not to sell or otherwise dispose of any shares of LTI
Common Stock unless all of the parties mutually agreed (subject to certain
exceptions), (ii) to bear its own costs and expenses incurred in connection with
its ownership of LTI Common Stock, the Group Agreement or any transactions
entered into pursuant to the Group Agreement (subject to certain exceptions for
expenses incurred for the benefit of all the parties thereto), (iii) to join
with ISP in a Schedule 13D filing and any required amendments thereto and (iv)
not to enter into any other contract, arrangement, understanding or relationship
with any other person with respect to the equity securities of LTI. The Group
Agreement provided for a term of six months, but was extended through September
30, 2000 by all but one of the original members of the group.
No Participant or Associate owns any securities of the Company of
record but not beneficially.
None of the Participants and none of their associates has any
arrangement or understanding with any person with respect to (i) any future
employment with the Company or (ii) any future transactions to which the Company
or any of its affiliates may be a party, except as set forth in the letter,
dated December 14, 1999, from Mr. Heyman to the Company's Chairman and Chief
Executive Officer, in which ISP proposed to purchase all of the Company's
outstanding Common Stock for $45 per share in a merger transaction, which
proposal was subsequently rejected by the Company's Board by correspondence
dated December 23, 1999. No family relationships exist among the Proponent's
Nominees or between any Company director or executive officer and any of the
Proponent's Nominees.
The Proponent reserves the right to retain one or more financial
advisors and proxy solicitors, who may be considered participants in a
solicitation under Regulation 14A of the Exchange Act.
The following is a summary of all transactions in Company securities
by the Participants over the last two years.
DATE OF TRANSACTION NATURE OF TRANSACTION NUMBER OF SHARES
-------------------------------------------------------------------
09/15/98 Buy 37,000
09/17/98 Buy 440,000
09/21/98 Buy 64,700
09/23/98 Buy 5,400
09/25/98 Buy 10,000
09/30/98 Buy 10,600
10/01/98 Buy 100
10/02/98 Buy 25,000
10/05/98 Buy 600
25
<PAGE>
10/06/98 Buy 14,200
10/07/98 Buy 18,400
10/09/98 Buy 55,500
10/16/98 Buy 169,100
10/19/98 Buy 75,000
11/11/98 Buy 47,500
11/12/98 Buy 69,600
12/01/98 Sell (50,000)
12/02/98 Sell (25,000)
12/04/98 Buy 106,500
12/09/98 Buy 11,600
12/10/98 Buy 15,600
12/11/98 Buy 18,500
12/14/98 Buy 14,000
12/15/98 Buy 6,000
02/17/99 Buy 5,000
03/31/99 Buy 7,500
05/07/99 Sell (25,000)
05/13/99 Buy 10,000
05/14/99 Buy 20,000
05/17/99 Buy 17,100
05/18/99 Buy 21,600
05/19/99 Buy 2,500
05/21/99 Buy 10,000
05/24/99 Buy 11,400
05/25/99 Buy 20,500
05/26/99 Buy 20,000
05/27/99 Buy 19,000
05/28/99 Buy 2,000
06/01/99 Buy 19,000
06/02/99 Buy 22,500
06/03/99 Buy 6,200
06/07/99 Buy 5,500
06/08/99 Buy 1,900
06/09/99 Buy 31,500
06/10/99 Buy 1,300
06/15/99 Buy 10,000
06/24/99 Sell (25,000)
07/13/99 Sell (2,900)
07/22/99 Buy 9,600
07/23/99 Buy 5,000
07/26/99 Buy 4,700
07/28/99 Buy 7,700
26
<PAGE>
08/03/99 Sell (6,300)
08/05/99 Buy 3,500
08/06/99 Sell (3,500)
08/09/99 Buy 248,400
08/10/99 Buy 11,400
08/11/99 Buy 12,700
08/19/99 Sell (5,300)
08/20/99 Buy 56,000
08/23/99 Buy 94,900
08/24/99 Buy 28,900
08/25/99 Buy 12,300
08/27/99 Buy 12,000
08/30/99 Buy 13,000
08/31/99 Buy 7,500
09/03/99 Buy 84,300
09/07/99 Buy 48,600
09/08/99 Buy 9,900
09/13/99 Sell (1,000)
09/14/99 Sell (1,400)
09/15/99 Sell (2,000)
09/17/99 Buy 46,300
09/20/99 Buy 76,000
09/21/99 Buy 31,400
09/22/99 Buy 15,000
09/23/99 Buy 34,000
09/24/99 Buy 47,600
09/27/99 Buy 46,500
-------------
2,299,200
=============
27
<PAGE>
SCHEDULE A TO ANNEX VII
Associates of International Specialty Products Inc.
---------------------------------------------------
ISP Opco Holdings Inc.
Belleville Realty Corp.
ISP Alginates Inc.
ISP Management Company, Inc.
ISP Chemicals Inc.
ISP Minerals Inc.
ISP Technologies Inc.
ISP Mineral Products Inc.
ISP Environmental Services Inc.
Bluehall Incorporated
ISP Realty Corporation
ISP Real Estate Company, Inc.
International Specialty Products Funding Corporation
ISP Newark Inc.
ISP Van Dyk Inc.
ISP Fine Chemicals Inc.
ISP Freetown Fine Chemicals Inc.
Verona Inc.
ISP Global Technologies Inc.
ISP International Corp.
ISP Marl Holdings Gmbh
ISP Holdings (U.K.) Ltd.
ISP Ireland
ISP (Puerto Rico) Inc.
ISP Marl Gmbh
ISP Acetylene Gmbh
ISP Alginates (U.K.) Ltd.
ISP (Great Britain) Co. Ltd.
ISP Andina, C.A.
ISP Argentina S.A.
ISP Asia Pacific Pte Ltd.
ISP (Australasia) Pte Ltd.
ISP (Belgium) N.V.
ISP (Belgium) International N.V.
ISP do Brasil Ltda.
ISP (Canada) Inc.
ISP Ceska Republika Spol S.R.O.
ISP (China) Limited
ISP Colombia Ltda.
28
<PAGE>
ISP Freight Service N.V.
ISP Global Operations (Barbados) Inc.
ISP Global Technologies (Belgium) S.A.
ISP Global Technologies (Germany) Holding Gmbh
ISP Customer Service Gmbh
ISP Global Technologies Deutschland Gmbh
International Specialty Products ISP (France) S.A.
ISP (Hong Kong) Limited
ISP (Italia) S.r.l.
ISP (Japan) Ltd.
ISP (Korea) Limited
ISP Mexico, S.A. de C.V.
ISP (Norden) A.B.
ISP (Osterreich) G.m.b.h.
ISP (Polska) Sp.z. o.p.
ISP Sales (Barbados) Inc.
ISP Sales (U.K.) Limited
ISP (Singapore) Pte Ltd.
ISP (Switzerland) A.G.
ISP (Thailand) Co., Ltd.
Chemfields Pharmaceuticals Private Limited
29
<PAGE>
Exhibit 1-A
Consent to Serve as Director of Dexter Corporation
--------------------------------------------------
To: Secretary of Dexter Corporation
The undersigned hereby consents (i) to be nominated for election to
the Board of Directors of Dexter Corporation, a Connecticut corporation (the
"Company"), (ii) to serve as a director of the Company, if he is duly elected by
the shareholders thereof, and (iii) to the reference to his or her name in the
Proxy Statement of International Specialty Products Inc., and any amendments
thereto, in connection with the 2000 Annual Meeting of Shareholders of the
Company, as a person nominated to serve as a director of the Company.
Dated the 27th day of January, 2000.
/s/ Samuel J. Heyman
--------------------
Samuel J. Heyman
30
<PAGE>
Exhibit 1-B
Consent to Serve as Director of Dexter Corporation
--------------------------------------------------
To: Secretary of Dexter Corporation
The undersigned hereby consents (i) to be nominated for election to
the Board of Directors of Dexter Corporation, a Connecticut corporation (the
"Company"), (ii) to serve as a director of the Company, if he is duly elected by
the shareholders thereof, and (iii) to the reference to his or her name in the
Proxy Statement of International Specialty Products Inc., and any amendments
thereto, in connection with the 2000 Annual Meeting of Shareholders of the
Company, as a person nominated to serve as a director of the Company.
Dated the 27th day of January, 2000.
/s/ Sunil Kumar
-----------------------
Sunil Kumar
31
<PAGE>
Exhibit 1-C
Consent to Serve as Director of Dexter Corporation
--------------------------------------------------
To: Secretary of Dexter Corporation
The undersigned hereby consents (i) to be nominated for election to
the Board of Directors of Dexter Corporation, a Connecticut corporation (the
"Company"), (ii) to serve as a director of the Company, if he is duly elected by
the shareholders thereof, and (iii) to the reference to his or her name in the
Proxy Statement of International Specialty Products Inc., and any amendments
thereto, in connection with the 2000 Annual Meeting of Shareholders of the
Company, as a person nominated to serve as a director of the Company.
Dated the 22nd day of January, 2000.
/s/Philip Peller
----------------
Philip Peller
32
<PAGE>
Exhibit 1-D
Consent to Serve as Director of Dexter Corporation
--------------------------------------------------
To: Secretary of Dexter Corporation
The undersigned hereby consents (i) to be nominated for election to
the Board of Directors of Dexter Corporation, a Connecticut corporation (the
"Company"), (ii) to serve as a director of the Company, if he is duly elected by
the shareholders thereof, and (iii) to the reference to his or her name in the
Proxy Statement of International Specialty Products Inc., and any amendments
thereto, in connection with the 2000 Annual Meeting of Shareholders of the
Company, as a person nominated to serve as a director of the Company.
Dated the 27th day of January, 2000.
/s/Robert Englander
-------------------
Robert Englander
33
<PAGE>
Exhibit 1-E
Consent to Serve as Director of Dexter Corporation
--------------------------------------------------
To: Secretary of Dexter Corporation
The undersigned hereby consents (i) to be nominated for election to
the Board of Directors of Dexter Corporation, a Connecticut corporation (the
"Company"), (ii) to serve as a director of the Company, if he is duly elected by
the shareholders thereof, and (iii) to the reference to his or her name in the
Proxy Statement of International Specialty Products Inc., and any amendments
thereto, in connection with the 2000 Annual Meeting of Shareholders of the
Company, as a person nominated to serve as a director of the Company.
Dated the 19th day of January, 2000.
/s/Alan Meckler
---------------
Alan Meckler
34
<PAGE>
Exhibit 1-F
Consent to Serve as Director of Dexter Corporation
--------------------------------------------------
To: Secretary of Dexter Corporation
The undersigned hereby consents (i) to be nominated for election to
the Board of Directors of Dexter Corporation, a Connecticut corporation (the
"Company"), (ii) to serve as a director of the Company, if he is duly elected by
the shareholders thereof, and (iii) to the reference to his or her name in the
Proxy Statement of International Specialty Products Inc., and any amendments
thereto, in connection with the 2000 Annual Meeting of Shareholders of the
Company, as a person nominated to serve as a director of the Company.
Dated the 20th day of January, 2000.
/s/Dan Ogden
------------
Dan Ogden
35
<PAGE>
Exhibit 1-G
Consent to Serve as Director of Dexter Corporation
--------------------------------------------------
To: Secretary of Dexter Corporation
The undersigned hereby consents (i) to be nominated for election to
the Board of Directors of Dexter Corporation, a Connecticut corporation (the
"Company"), (ii) to serve as a director of the Company, if he is duly elected by
the shareholders thereof, and (iii) to the reference to his or her name in the
Proxy Statement of International Specialty Products Inc., and any amendments
thereto, in connection with the 2000 Annual Meeting of Shareholders of the
Company, as a person nominated to serve as a director of the Company.
Dated the 19th day of January, 2000.
/s/Morrison DeSoto Webb
-----------------------
Morrison DeSoto Webb
36
<PAGE>
Exhibit 1-H
Consent to Serve as Director of Dexter Corporation
--------------------------------------------------
To: Secretary of Dexter Corporation
The undersigned hereby consents (i) to be nominated for election to
the Board of Directors of Dexter Corporation, a Connecticut corporation (the
"Company"), (ii) to serve as a director of the Company, if he is duly elected by
the shareholders thereof, and (iii) to the reference to his or her name in the
Proxy Statement of International Specialty Products Inc., and any amendments
thereto, in connection with the 2000 Annual Meeting of Shareholders of the
Company, as a person nominated to serve as a director of the Company.
Dated the 18th day of January, 2000.
/s/Anthony T. Kronman
---------------------
Anthony T. Kronman
37
<PAGE>
Exhibit 1-I
Consent to Serve as Director of Dexter Corporation
--------------------------------------------------
To: Secretary of Dexter Corporation
The undersigned hereby consents (i) to be nominated for election to
the Board of Directors of Dexter Corporation, a Connecticut corporation (the
"Company"), (ii) to serve as a director of the Company, if he is duly elected by
the shareholders thereof, and (iii) to the reference to his or her name in the
Proxy Statement of International Specialty Products Inc., and any amendments
thereto, in connection with the 2000 Annual Meeting of Shareholders of the
Company, as a person nominated to serve as a director of the Company.
Dated the 20th day of January, 2000.
/s/John Droney
--------------
John Droney
38
<PAGE>
Exhibit 1-J
Consent to Serve as Director of Dexter Corporation
--------------------------------------------------
To: Secretary of Dexter Corporation
The undersigned hereby consents (i) to be nominated for election to
the Board of Directors of Dexter Corporation, a Connecticut corporation (the
"Company"), (ii) to serve as a director of the Company, if he is duly elected by
the shareholders thereof, and (iii) to the reference to his or her name in the
Proxy Statement of International Specialty Products Inc., and any amendments
thereto, in connection with the 2000 Annual Meeting of Shareholders of the
Company, as a person nominated to serve as a director of the Company.
Dated the 24th day of January, 2000.
/s/Vincent Tese
---------------
Vincent Tese
39
Exhibit 2
UNITED STATES DISTRICT COURT
DISTRICT OF CONNECTICUT
- -----------------------------------------x
INTERNATIONAL SPECIALTY :
PRODUCTS INC. and ISP INVESTMENTS : CIVIL ACTION NO.:
INC., :
:
Plaintiffs, :
:
v. :
:
DEXTER CORPORATION, K. GRAHAME : JANUARY 27, 2000
WALKER, HENRIETTA HOLSMAN FORE, :
ROBERT M. FUREK, EDGAR G. HOTARD, :
PETER G. KELLY, JEAN-FRANCOIS SAGLIO :
and GEORGE M. WHITESIDES, :
:
Defendants. :
- -----------------------------------------x
COMPLAINT
Plaintiffs International Specialty Products Inc. and ISP Investments
Inc. (collectively, "ISP"), by their undersigned attorneys, for their Complaint
against defendants Dexter Corporation, K. Grahame Walker, Henrietta Holsman
Fore, Robert M. Furek, Edgar G. Hotard, Peter G. Kelly, Jean-Francois Saglio and
George M. Whitesides, allege, upon personal knowledge with respect to themselves
and their own acts, and otherwise upon information and belief, based on an
investigation conducted by their attorneys, which included a review of news
reports, press releases and public documents filed with the Securities and
Exchange Commission (the "SEC"), as follows:
NATURE OF ACTION
1. This is an action for a declaratory judgment and injunctive relief
in connection with the upcoming annual meeting of Dexter Corporation ("Dexter").
NY1:\866917\04\54104.0016
<PAGE>
ISP seeks to enable Dexter's shareholders to exercise two of the most
fundamental rights of stock ownership: determining who should serve as the
directors of their company and deciding when and at what price to sell their
shares. Plaintiffs seek to enable Dexter's shareholders to exercise these
fundamental rights free of interference from Dexter's directors, who have sought
to thwart the will of shareholders by adopting and/or maintaining illegal
supermajority voting and "poison pill" provisions rather than complying with
their fiduciary obligations to Dexter's shareholders.
2. ISP has offered to acquire all of the shares of Dexter common
stock not owned by ISP at a price of $45 per share - a 38 percent premium over
the stock's market value as of the close of trading the day before the offer was
made, and a price that is higher than Dexter stock ever has traded. ISP also has
offered to increase its offer if ISP is provided with additional information
justifying an increased price. Dexter's directors seek to block consideration of
ISP's offer by Dexter's shareholders. In response to the Dexter directors'
actions, ISP has proposed a series of shareholder resolutions that, if adopted,
will facilitate the ability of Dexter's shareholders to consider ISP's offer and
determine the corporation's ultimate destiny.
3. Absent the grant of relief sought in this action, Dexter's
directors likely will continue along the course they have followed to date and
will use their supermajority voting and poison pill provisions to preclude
shareholder democracy and seek to block shareholders from considering ISP's
shareholder resolutions and, if the resolutions are adopted, ignore them,
thereby wresting from Dexter's shareholders corporate power over fundamental
decisions concerning Dexter's destiny.
2
<PAGE>
4. ISP's proposed shareholder resolutions, if adopted, would not
mandate the acceptance of ISP's or any other offer. ISP seeks only to restore
and enhance shareholder democracy by ensuring that Dexter's shareholders are
able to freely choose who will make the critical decisions affecting their
company and decide for themselves whether an offer for their shares - by ISP or
anyone else - should be accepted.
JURISDICTION AND VENUE
5. This Court has jurisdiction over the subject matter of this action
pursuant to 28 U.S.C.ss.1332(a). The parties are of diverse citizenship and the
amount in controversy (exclusive of interests and costs) exceeds $75,000.
6. Venue is proper in this Court pursuant to 28 U.S.C.ss.1391(a). A
substantial part of the events giving rise to the claims alleged herein occurred
in this District. The defendants conduct business or reside in this District.
THE PARTIES
7. Plaintiff International Specialty Products Inc. is a corporation
organized under the laws of Delaware with its principal place of business at 300
Delaware Avenue, Wilmington, Delaware. Plaintiff ISP Investments Inc. is a
corporation organized under the laws of Delaware with its principal place of
business at 300 Delaware Avenue, Wilmington, Delaware. Plaintiffs are currently
the beneficial owners of 2,299,200 shares of Dexter common stock, which
represents approximately 9.98 percent of Dexter's outstanding shares of common
stock. ISP Investments Inc. holds of record 100 shares of Dexter common stock.
8. Defendant Dexter is a corporation organized under the laws of
Connecticut with its principal place of business at One Elm Street, Windsor
Locks,
3
<PAGE>
Connecticut. Dexter is a global specialty materials supplier with three
operating segments: life sciences, nonwovens and specialty polymers. Dexter
supplies these specialty materials to the aerospace, electronics, food packaging
and medical markets.
9. (a) Defendant K. Grahame Walker is the Chairman, President and
Chief Executive Officer of Dexter. He is a member of Dexter's board of
directors.
(b) Defendants Henrietta Holsman Fore, Robert M. Furek, Edgar G.
Hotard, Peter G. Kelly, Jean-Francois Saglio and George M. Whitesides are all
members of Dexter's board of directors. Charles H. Curl, Bernard M. Fox and
Martha Clark Goss also are members of Dexter's board of directors. Dexter's
directors owe the highest fiduciary duties of care, loyalty and good faith to
the shareholders of the company, including ISP, under Connecticut law.
(c) None of the Dexter directors named as defendants is a citizen
of Delaware for diversity purposes. Walker, Furek and Kelly are each citizens of
Connecticut. Fore is a citizen of Nevada. Hotard is a citizen of Texas.
Whitesides is a citizen of Massachusetts. Saglio is a citizen of France.
(d) Dexter's board is a staggered board. The terms of directors
Curl, Kelly and Saglio expire at Dexter's 2000 annual meeting; the terms of
directors Furek, Goss and Hotard expire at Dexter's 2001 annual meeting; and the
terms of directors Fore, Fox, Walker and Whitesides expire at Dexter's 2002
annual meeting.
(e) According to Dexter's 1999 proxy statement, Dexter's directors
(other than Walker) each received an annual retainer of $20,000 for serving on
Dexter's board plus $1,000 for each meeting attended ($2,000 if the meeting was
not held
4
<PAGE>
at company headquarters) and additional compensation for committee attendance
and serving as the chair of a permanent committee.
FACTUAL ALLEGATIONS
10. Dexter's directors repeatedly have failed and refused to take the
steps necessary to enhance the value of Dexter's common stock and act in the
best interests of the company's shareholders in breach of their fiduciary and
other legal obligations. Dexter's directors have done so while simultaneously
seeking to entrench themselves in their positions of power and prestige by
undermining shareholder democracy and adopting illegal anti-takeover defenses.
DEXTER'S ILLEGAL SUPERMAJORITY VOTING AND POISON PILL
ANTI-TAKEOVER DEFENSES
- -----------------------------------------------------
11. Dexter's directors adopted and/or maintained an illegal weapon to
preserve their continued incumbency and frustrate the ability of shareholders to
make decisions concerning the corporation's ultimate destiny: a bylaw provision
(Article X of Dexter's bylaws) requiring a two-thirds supermajority vote for
shareholder bylaw amendments. Connecticut law allows supermajority provisions
only if expressly authorized in a shareholder approved certificate of
incorporation provision. Dexter's certificate of incorporation contains no such
authorization.
12. Dexter's directors have adopted and/or maintained another weapon
with which they can protect their continued incumbency: a "poison pill" rights
plan.
13. As originally adopted, Dexter's poison pill plan provided that if
any person or group acquires beneficial ownership of 20 percent or more of
Dexter's common stock without board approval, rights issued under the plan to
all Dexter
5
<PAGE>
shareholders other than the 20 percent holder would become exercisable and
permit all Dexter shareholders other than the 20 percent shareholder to purchase
additional shares of common stock at one-half the current market price of Dexter
stock. The pill discriminates against the 20 percent holder because the 20
percent holder is not entitled to purchase at half price the additional shares
that every other common stockholder is entitled to purchase at half price. The
20 percent shareholder thus suffers an immediate and devastating economic injury
and voting power dilution. No rational shareholder would risk taking any action
that would result in this immediate and devastating economic injury and voting
power dilution.
14. Dexter's directors granted themselves the exclusive authority to
administer the poison pill, including the sole power to redeem the rights issued
to holders of common stock for nominal value. Accordingly, Dexter's directors in
their sole discretion decide whether or not anyone can become a 20 percent
holder without suffering the immediate and devastating economic injury and
voting power dilution described above. The poison pill thus allows the board to
exercise veto power over any acquisition of more than the triggering percentage
of shares. The poison pill thus deprives Dexter shareholders of the right to
consider and vote on whether an acquisition proposal is in their best interests
unless Dexter's directors first consent to the acquisition proposal.
15. As noted below, one week following ISP's disclosure that it had
increased its holdings of Dexter to approximately 9.98 percent of Dexter's
common stock, the 20 percent trigger recently was lowered to 11 percent for
shareholders who do
6
<PAGE>
not assure the SEC in a Schedule 13G filing that their ownership position has
been acquired without any intent to change or influence control of Dexter.
THE DEXTER DIRECTORS' DISREGARD OF SHAREHOLDER RIGHTS
AND DEMOCRACY AT DEXTER'S LTI SUBSIDIARY
- -----------------------------------------------------
16. Since the early 1980s, Dexter has been the majority owner of Life
Technologies, Inc. ("LTI"), a Delaware corporation engaged in the development
and manufacture of biological and biochemical products for research and chemical
applications. As a majority shareholder of LTI, Dexter owes fiduciary duties to
LTI's minority shareholders, just as Dexter's directors owe fiduciary duties to
Dexter's own shareholders.
17. During the summer of 1998, Dexter's directors determined to seek
to acquire control of the LTI shares owned by LTI's minority shareholders.
Dexter's directors did so by trampling over the rights of LTI's minority
shareholders just as Dexter's directors have trampled over the rights of their
own shareholders.
18. On or about July 7, 1998, Dexter, which then owned approximately
52 percent of LTI's outstanding shares, proposed to purchase the remaining
approximately 48 percent of LTI in exchange for $37 per share. Because a
majority of LTI's board was controlled by Dexter, LTI's board appointed a
special committee of three independent directors to evaluate and respond to this
proposal and protect the interests of LTI's minority shareholders.
19. On October 27, 1998, following a comprehensive valuation of LTI,
with the assistance of a nationally recognized investment banking firm, Goldman
Sachs & Co., and independent legal counsel, Wachtell, Lipton, Rosen & Katz,
LTI's special
7
<PAGE>
committee of independent directors reported that it would not recommend
to LTI's shareholders that Dexter's proposal be accepted for the following
reasons:
(a) The special committee did not believe the Dexter proposal
adequately reflected LTI's prospects, particularly the value of its research and
development pipeline;
(b) LTI had received inquiries from a party interested in
acquiring all of LTI's stock at a higher price, to which it could not respond
because Dexter had advised LTI that Dexter was not interested in disposing of
its LTI holdings; and
(c) Dexter's proposed $37 per share price was substantially below
the $40 to $50 plus per share range the special committee considered an
appropriate price range for LTI shares at that time. At least one Goldman Sachs'
analysis concluded that LTI's total value at that time exceeded $60 per share.
20. In a remarkable disregard for shareholder rights and corporate
process, the Dexter-dominated LTI board determined to ignore the special
committee's recommendations, announced that Dexter would proceed without the
special committee's approval, and disbanded the special committee. Two of the
three members of the special committee resigned as LTI directors in protest. One
of the resigning directors described Dexter's actions as "heavyhanded" and
stated that Dexter was "depriv[ing] [LTI's] stockholders of the significant
inherent values to which they are rightfully entitled."
21. Dexter then commenced a tender offer for the outstanding shares
of LTI at the $37 per share price the special committee had determined was
inadequate. Although Dexter later amended its tender offer to increase the price
from $37 to $39.125
8
<PAGE>
per share, Dexter's new price remained below even the low end of the $40 to $50
plus per share range considered appropriate by LTI's special committee at that
time.
22. Upon completion of its tender offer, Dexter had increased its
ownership of LTI substantially from approximately 52 percent to approximately 71
percent. A short time later, LTI's common stock was delisted from the Nasdaq
stock market due to LTI's inability to remain in compliance with Nasdaq
maintenance standards following Dexter's completed tender offer, thereby further
harming LTI's minority shareholders. On July 26, 1999, LTI's board announced
that it had decided to discontinue regular quarterly dividends on LTI's common
stock.
ISP'S FALL 1999 SHARE PURCHASES AND DEXTER'S RESPONSE:
AN ENHANCEMENT TO ITS ILLEGAL POISON PILL
- ------------------------------------------------------
23. On September 27, 1999, ISP publicly announced in a Schedule 13D
filing that it had increased its holdings of Dexter common stock to
approximately 9.98 percent of Dexter's outstanding shares.
24. On October 4, 1999, Dexter's directors responded by amending
Dexter's illegal poison pill to further augment their ability to block any offer
for Dexter even if a majority of Dexter's shareholders favored the acquisition.
Dexter's directors accomplished this by reducing the trigger from 20 percent to
11 percent unless the 11 percent shareholder files a Schedule 13G with the SEC
stating that its ownership position has been acquired without any intent to
change or influence control of Dexter. Now, an 11 percent shareholder who
cannot, like institutional investors, investment advisors and certain other
parties, file a Schedule 13G, will be treated differently from all other
9
<PAGE>
shareholders and suffer the immediate and devastating economic and voting power
dilution that previously was reserved for 20 percent shareholders.
25. The obvious purpose of the Dexter directors' poison pill
enhancement one week after ISP increased its holdings of Dexter stock was to
render any further purchases of Dexter common stock by ISP economically
irrational, scare off all other potential acquirers, and preclude Dexter's
shareholders from making their own decisions concerning whether they want to
sell their shares to ISP or anyone else, even if a majority of Dexter's
shareholders favored ISP's proposal.
ISP'S $45 PER SHARE PROPOSAL TO DEXTER
- --------------------------------------
26. On December 14, 1999, ISP sent a letter to Dexter offering to
acquire all Dexter shares not owned by ISP pursuant to a negotiated merger
agreement for a price of $45 per share, representing a 38 percent premium over
the stock's market value as of the close of trading the day before the offer was
made, and a price that is higher than Dexter stock ever has traded. ISP's letter
added that ISP would be willing to pay more for Dexter if provided with
additional information justifying an increased price.
27. On December 14, 1999, Dexter issued a press release stating that
the board would consider the proposed offer, but noted that ISP's letter did not
identify a source of funds for the offer.
28. On December 16, 1999, ISP advised Dexter that "we intend to
finance with bank borrowings and will provide commitments for such financing as
appropriate." The letter reiterated that "ISP stand[s] ready with our advisors
to meet with you as soon as possible regarding all aspects of the proposed
merger agreement."
10
<PAGE>
29. On December 23, 1999, Dexter's directors rejected ISP's offer.
The Dexter directors made this important decision without meeting with ISP to
discuss the proposal. Dexter's directors stated that ISP's $45 per share offer
was inadequate from a financial point of view, but refused to provide ISP any
information about Dexter that would justify a higher price, as ISP had requested
in its letter.
30. On January 20, 2000, faced with ISP's offer, Dexter offered to
purchase all remaining LTI stock it did not own for $49 per share, a price
substantially in excess of the price paid to other LTI shareholders in its prior
tender offer for LTI. It is apparent from the timing of Dexter's offer for LTI
stock, coming on the heels of ISP's $45 per share offer for Dexter's stock, upon
which many of Dexter's shareholders have relied, that Dexter is seeking to
divert ISP from a course of action designed to maximize shareholder values for
all Dexter shareholders. Dexter's attempt to deter ISP by providing benefits to
ISP not available to other Dexter shareholders is simply inappropriate.
THE ISP PROPOSALS
- -----------------
31. On January 27, 2000, confronted with the refusal of Dexter's
directors even to speak with ISP, ISP notified Dexter that it intends to submit
proposals to the company's shareholders for consideration at Dexter's annual
meeting. Dexter's annual meetings since 1990 all have been held in April, and it
is expected that the 2000 annual meeting will be held in April 2000.
32. These proposals oppose the re-election of the three incumbent
Dexter directors whose terms expire at Dexter's 2000 annual meeting (Curl, Kelly
and Saglio) and support three groups of shareholder proposals, the "Nominee
Election Proposals," "Shareholder Rights Proposals," and "Voting Rights
Proposals." The shareholder proposals are intended to restore shareholder
democracy and allow the stockholders - the true owners of Dexter - to determine
for themselves the future direction of their company. Copies of these proposals
are attached as Exhibits A, B, and C, respectively.
33. ISP's Nominee Election Proposals ask Dexter shareholders to vote
on the following:
(a) a slate of nominees in opposition to directors Curl, Kelly,
and Saglio, whose terms expire at Dexter's 2000 annual meeting;
11
<PAGE>
(b) an amendment to Article III of Dexter's bylaws that would
increase the size of Dexter's board from ten directors to seventeen directors
and that could be altered, amended or repealed only with the approval of
Dexter's shareholders; and
(c) a slate of nominees to fill all newly-created directorships.
34. The Nominee Election Proposals are designed to enable Dexter's
shareholders to determine who will serve on their company's board of directors
and, in connection with the 2000 annual meeting, allow them to decide whether to
elect a majority of directors who are willing, unlike Dexter's current
directors, to consider transactions intended to maximize shareholder value even
if those transactions result in a sale of Dexter and a loss of the directors'
positions as Dexter directors.
35. ISP's Shareholder Rights Proposals concern Dexter's illegal
poison pill and ask Dexter's shareholders to vote on the following in the event
that Dexter's illegal poison pill is not declared invalid by this Court before
the annual meeting:
(a) a bylaw amendment (i) requiring Dexter's board to amend the
poison pill to render it inapplicable to specified offers or transactions or
types of offers or transactions or to redeem the rights issued under the rights
plan if the shareholders approve a resolution instructing the board to do so,
(ii) prohibiting Dexter's board from adopting a new poison pill unless the
poison pill first is approved by shareholders, and (iii) precluding Dexter's
board from altering, amending or repealing this bylaw provision without
shareholder approval; and
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(b) a shareholder resolution, in the event that Dexter's bylaws
are amended in accordance with the preceding paragraph, requiring Dexter's board
to amend its poison pill to render it inapplicable to any cash offer of at least
$45 per share.
36. The Shareholder Rights Proposals are in the best interests of
Dexter's shareholders. If this Court does not invalidate Dexter's illegal poison
pill, these resolutions would enable Dexter's stockholders to decide at their
2000 annual meeting whether Dexter's directors should continue to possess the
exclusive power to employ Dexter's poison pill to block shareholders from even
having the opportunity to consider and vote on a proposed offer for their
shares. These proposals do not require the board to accept any particular offer
now or in the future, but merely ensure that the directors cannot unilaterally
reject or discourage proposed offers in their sole and unbridled discretion or
prevent shareholders from tendering their shares pursuant to a premium offer.
37. The Voting Rights Proposals ask Dexter's shareholders to vote on
the following:
(a) a shareholder resolution repealing any and all bylaw
amendments approved by Dexter's board on or after February 26, 1999, and barring
Dexter's directors from amending any section of Dexter's bylaws affected by this
resolution or adopting any new bylaw provision reinstating any repealed (or
similar) provision without approval of Dexter's shareholders; and
(b) a resolution setting forth the order in which ISP's various
proposals should be considered at the 2000 annual meeting.
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38. The Voting Rights Proposals are in the best interests of Dexter's
shareholders. These proposals seek to advance corporate democracy by ensuring
that Dexter's directors are unable to adopt bylaws that unilaterally frustrate
or block ISP's Nominee Election Proposals, Shareholders Rights Proposals or
similar proposals designed to provide Dexter's shareholders with a meaningful
say in their company's future.
39. Despite the clear benefit that would inure to Dexter's
shareholders from allowing consideration of these proposals at the 2000 annual
meeting, the Dexter directors' statements and conduct strongly indicate that
Dexter's directors will oppose these proposals, seek to preclude the
shareholders from considering them and undertake other actions designed to
frustrate corporate democracy and deprive Dexter's shareholders of any say in
determining their corporation's destiny.
40. In the absence of the relief requested herein, ISP and all other
Dexter shareholders will suffer irreparable harm for which they have no adequate
remedy at law.
FIRST COUNT
(Invalidity of Dexter's Supermajority
Voting Bylaw Provision)
41. ISP repeats and realleges the allegations in paragraphs 1 through
40 above as if fully set forth in this paragraph.
42. This is a claim for a declaratory judgment pursuant to 28
U.S.C.ss. 2201 and 28 U.S.C.ss. 2202 for the purpose of determining a question
of actual controversy between the parties. This also is a claim for preliminary
and permanent injunctive relief.
14
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43. Based upon their statements and conduct to date, ISP anticipates
that Dexter's directors will take the position that Article X of Dexter's bylaws
requires a two-thirds supermajority majority vote of Dexter's shareholders in
order to amend Dexter's bylaws. Section 33-807 of the Connecticut Business
Corporation Act permits supermajority voting provisions to be included in bylaws
only if expressly authorized by a certificate of incorporation provision.
Dexter's certificate of incorporation contains no provision permitting a
supermajority voting requirement. If Article X of the Dexter's bylaws requires a
two-thirds supermajority vote, then Article X is ultra vires, invalid, void and
of no effect.
44. Based upon their statements and conduct to date, ISP anticipates
that Dexter's directors will ignore Connecticut law and ignore or treat as
invalid any bylaw amendment approved by a majority vote but less than a
two-thirds supermajority vote of Dexter's shareholders.
45. There is an actual controversy within the jurisdiction of this
Court concerning Article X of Dexter's existing bylaws. This controversy may be
determined by a judgment of this Court.
46. ISP is entitled to a declaratory judgment that if Article X of
Dexter's bylaws imposes a supermajority voting requirement, then Article X
violates Connecticut law and is ultra vires, invalid, void and of no effect and
that Dexter's shareholders may alter, amend or repeal any Dexter bylaw or bylaws
by majority vote.
47. ISP is entitled to preliminary and permanent injunctive relief
barring enforcement of a supermajority voting requirement in Article X of
Dexter's bylaws.
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48. ISP has no adequate remedy at law.
SECOND COUNT
(Invalidity of Dexter's Poison Pill)
49. ISP repeats and realleges the allegations in paragraphs 1 through
48 above as if fully set forth in this paragraph.
50. This is a claim for a declaratory judgment pursuant to 28
U.S.C.ss. 2201 and 28 U.S.C.ss. 2202 for the purpose of determining a question
of actual controversy between the parties. This also is a claim for preliminary
and permanent injunctive relief.
51. Dexter's directors have adopted and maintained a poison pill
that, as amended in October 1999, provides that if any person or entity acquires
beneficial ownership of 11 percent of Dexter's common stock without board
approval, then each right issued under the plan will entitle the holder of the
right (with the exception of the 11 percent owner) to purchase additional shares
of Dexter common stock at one half the current market price of Dexter common
stock.
52. Section 33-665 of the Connecticut Business Corporation Act
specifically and expressly prohibits discrimination among shareholders of the
same class of shares. Section 33-665 states, in relevant part, that "[a]ll
shares of a class shall have preferences, limitations and relative rights
identical with those of other shares of the same class."
53. Dexter's poison pill violates ss. 33-665 because it impermissibly
discriminates among shares of the same class of stock by entitling all holders
of Dexter common stock, except the 11 percent shareholder, to exercise the right
to obtain
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additional shares of Dexter stock for each share then outstanding in exchange
for one-half the then current market price of Dexter common stock.
54. Dexter's poison pill also violates ss. 33-665 because it
impermissibly discriminates among 11 percent shareholders because 11 percent
shareholders who file a Schedule 13G with the SEC stating that their ownership
position has been acquired without any intent to change or influence control of
Dexter do not suffer the devastating economic and voting power dilution that the
poison pill inflicts on all other 11 percent shareholders.
55. Dexter's poison pill thus treats shareholders of the same class
differently and therefore is ultra vires, invalid, void and of no effect.
56. The continued operation and existence of Dexter's poison pill,
which is invalid under Connecticut law, has caused and will continue to cause
irreparable injury to ISP and all Dexter shareholders because no rational
shareholder would acquire 11 percent of Dexter's common stock with an intent to
change or influence control of Dexter without the approval of Dexter's directors
and risk the immediate and devastating economic injury and voting power dilution
that would follow.
57. Based upon their statements and conduct to date, ISP anticipates
that Dexter's directors will adhere to and seek to uphold Dexter's poison pill.
58. There is an actual controversy within the jurisdiction of this
Court concerning the validity of Dexter's poison pill. This controversy may be
determined by a judgment of this Court.
59. ISP is entitled to a declaratory judgment that Dexter's poison
pill violates Connecticut law and is ultra vires, invalid, void and of no
effect.
17
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60. ISP is entitled to preliminary and permanent injunctive relief
barring enforcement of Dexter's poison pill.
61. ISP has no adequate remedy at law.
THIRD COUNT
(Nominee Election Proposals)
62. ISP repeats and realleges the allegations in paragraphs 1 through
61 above as if fully set forth in this paragraph.
63. This is a claim for a declaratory judgment pursuant to 28 U.S.C.
ss. 2201 and 28 U.S.C. ss. 2202 for the purpose of determining a question of
actual controversy between the parties and for preliminary and permanent
injunctive relief.
64. ISP's Nominee Election Proposals are valid under Connecticut law
and consistent with Dexter's certificate of incorporation. Under Connecticut
law, shareholders possess the inherent power to amend bylaws in order to create
(and then elect directors to fill) new directorships unless the certificate of
incorporation explicitly divests shareholders of that authority. Dexter's
certificate of incorporation contains no such limit on shareholders' authority.
Dexter's shareholders therefore retain the ability to create and fill new
directorships. This right may not be abrogated by Dexter's directors.
65. Based on their statements and conduct to date, ISP anticipates
that Dexter's directors will challenge the right of shareholders to vote for or
against the Nominee Election Proposals.
66. There is an actual controversy within the jurisdiction of this
Court concerning the right of Dexter's shareholders to vote for or against the
Nominee Election Proposals. This controversy may be determined by a judgment of
this Court.
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67. ISP is entitled to a declaratory judgment that:
(a) The Nominee Election Proposals are valid under Connecticut law
and consistent with Dexter's certificate of incorporation, are the proper
subject for action by Dexter's shareholders, and may be voted upon by Dexter's
shareholders at Dexter's 2000 annual meeting; and
(b) Dexter's shareholders have the lawful right to increase the
size of Dexter's board by amending Dexter's bylaws and to fill all newly created
directorships by majority vote at Dexter's 2000 annual meeting.
68. ISP is entitled to preliminary and permanent injunctive relief
permitting a shareholder vote on the Nominee Election Proposals at the 2000
annual meeting.
69. ISP has no adequate remedy at law.
FOURTH COUNT
(Shareholder Rights Proposals)
70. ISP repeats and realleges the allegations in paragraphs 1 through
69 above as if fully set forth in this paragraph.
71. This is a claim for a declaratory judgment pursuant to 28
U.S.C.ss.2201 and 28 U.S.C.ss.2202 for the purpose of determining a question of
actual controversy between the parties. This also is a claim for preliminary and
permanent injunctive relief.
72. ISP's Shareholder Rights Proposals are valid under Connecticut
law and consistent with Dexter's certificate of incorporation. Under Connecticut
law, shareholders possess the inherent power to amend bylaws to require
directors to modify
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poison pills or redeem rights issued pursuant to poison pills and prevent
directors from adopting poison pills without shareholder approval. Neither
Connecticut law nor Dexter's certificate of incorporation vests the board with
exclusive authority to create, implement and maintain poison pills or to
override and ignore shareholder objections to poison pills.
73. Based on their statements and conduct to date, ISP anticipates
that Dexter's directors will challenge the right of shareholders to vote for or
against the Shareholder Rights Proposals.
74. There is an actual controversy within the jurisdiction of this
Court concerning the rights of Dexter's shareholders to vote for or against the
Shareholder Rights Proposals. This controversy may be determined by a judgment
of this Court.
75. ISP is entitled to a declaratory judgment that:
(a) The Shareholder Rights Proposals are valid under Connecticut
law and consistent with Dexter's certificate of incorporation, are the proper
subject for action by Dexter's shareholders, and may be voted upon by Dexter
shareholders at Dexter's 2000 annual meeting; and
(b) Dexter shareholders have the lawful right to amend the Dexter
bylaws to require that Dexter's directors amend Dexter's poison pill or redeem
rights issued pursuant to Dexter's poison pill and prevent Dexter's directors
from adopting further poison pills without shareholder approval.
76. ISP is entitled to preliminary and permanent injunctive relief
permitting a shareholder vote on the Shareholder Rights Proposals at the 2000
annual meeting.
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<PAGE>
77. ISP has no adequate remedy at law.
FIFTH COUNT
(Voting Rights Proposals)
78. ISP repeats and realleges the allegations in paragraphs 1 through
77 above as if fully set forth in this paragraph.
79. This is a claim for a declaratory judgment pursuant to 28 U.S.C.
ss. 2201 and 28 U.S.C ss. 2202 for the purpose of determining a question of
actual controversy between the parties. This also is a claim for preliminary and
permanent injunctive relief.
80. ISP's Voting Rights Proposals are valid under Connecticut law and
consistent with Dexter's certificate of incorporation. Under Connecticut law,
shareholders possess the inherent power to amend or repeal bylaws and bar
directors from vetoing shareholder determinations to amend or repeal bylaws.
81. Based on their statements and conduct to date, ISP anticipates
that Dexter's directors will challenge the rights of shareholders to vote for or
against the Voting Rights Proposals.
82. There is an actual controversy within the jurisdiction of this
Court concerning the right of Dexter's shareholders to vote for or against the
Voting Rights Proposals. This controversy may be determined by a judgment of
this Court.
83. ISP is entitled to a declaratory judgment that the shareholders
may properly vote at the 2000 annual meeting on the Voting Rights Proposals.
84. ISP is entitled to preliminary and permanent injunctive relief
permitting a shareholder vote on the Voting Rights Proposals at the 2000 annual
meeting.
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85. ISP has no adequate remedy at law.
SIXTH COUNT
(Against Dexter's Directors for Breach of Fiduciary Duty)
86. ISP repeats and realleges the allegations in paragraphs 1 through
85 above as if fully set forth in this paragraph.
87. This is a claim for a declaratory judgment pursuant to 28
U.S.C.ss. 2201 and 28 U.S.C.ss. 2202 for purpose of determining a question of
actual controversy between the parties. This also is a claim for preliminary and
permanent injunctive relief and for money damages.
88. Dexter's directors owe Dexter's shareholders, including ISP,
fiduciary duties of care, loyalty and good faith and must act in the best
interests of the Dexter's and its shareholders, including ISP.
89. Dexter's directors have breached their fiduciary and other legal
obligations to Dexter and its shareholders, including ISP, by committing the
acts alleged above, including, without limitation, the following:
(a) adopting and not repealing Dexter's illegal supermajority
voting bylaw provision and poison pill;
(b) amending Dexter's poison pill in October 1999 to lower the
pill's trigger threshold from 20 percent to 11 percent for shareholders who do
not assure the SEC that their ownership position has been acquired without an
intent to change or influence control of Dexter;
(c) refusing to consider with the care, loyalty and good faith
required by law ISP's proposed $45 per share offer;
22
<PAGE>
(d) seeking to entrench themselves in office, elevating their own
interests over and above the best interests of Dexter and its shareholders; and
(e) failing to pursue opportunities and transactions that would
benefit Dexter shareholders and that are in the best interests of Dexter and
Dexter's shareholders.
90. Dexter's breach of its fiduciary and other legal obligations has
caused injury to ISP in excess of $75,000.
91. Based on their comments and conduct to date, ISP anticipates that
Dexter's directors will seek to impede or block any offer for all shares of
Dexter stock at a price of $45 or more in cash either through use of the poison
pill or by refusing to approve a business combination under Section 33-844 of
the Connecticut Business Corporation Act, which prohibits certain transactions
with interested shareholders for a five-year period unless approved by Dexter's
directors.
92. There is an actual controversy within the jurisdiction of this
Court concerning the ability of Dexter's board to impede or block an offer for
Dexter shares in accordance with their fiduciary obligations either by refusing
to utilize the poison pill or by refusing to approve the transaction under
Section 33-844 of the Connecticut Business Corporation Act. This controversy may
be determined by a judgment of this Court.
93. ISP is entitled to a declaratory judgment that Dexter's directors
may not seek to impede or block an offer for all Dexter shares at a price of $45
per share or more in cash by utilizing Dexter's poison pill or refusing to
approve the transaction under Section 33-844 of the Connecticut Business
Corporation Act.
23
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94. ISP is entitled to preliminary and permanent injunctive relief
barring Dexter's directors from seeking to impede or block an offer for all
Dexter shares at a price of $45 per share or more in cash by utilizing Dexter's
poison pill or refusing to approve the transaction under Section 33-844 of the
Connecticut Business Corporation Act.
95. Since at least 1990, Dexter consistently has held its annual
meeting of shareholders between April 22 and April 28. Based on their comments
and conduct to date, ISP anticipates that Dexter's directors will breach their
fiduciary duties to Dexter and its shareholders, including ISP, and seek to
undermine corporate democracy and manipulate the corporate machinery by refusing
to hold Dexter's annual meeting in April, the traditional time period for
Dexter's annual meeting, in order to prevent shareholders from considering and
voting upon ISP's proposals.
96. There is an actual controversy within the jurisdiction of this
Court concerning the date for the annual meeting of Dexter's shareholders. This
controversy may be determined by a judgment of this Court.
97. ISP is entitled to a declaratory judgment that the 2000 annual
meeting of Dexter's shareholders must be conducted no later than April 30, 2000.
98. ISP is entitled to preliminary and permanent injunctive relief
requiring that the 2000 annual meeting of Dexter's shareholders be conducted no
later than April 30, 2000.
99. ISP has no adequate remedy at law.
WHEREFORE, ISP respectfully requests that the Court enter judgment
against the defendants as follows:
24
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(a) on the First Count, declaring that if Article X of Dexter's
bylaws imposes a supermajority voting requirement, then Article X violates
Connecticut law and is ultra vires, invalid, void and of no effect and that
Dexter's shareholders may alter, amend or repeal any Dexter bylaw or bylaws by
majority vote;
(b) on the First Count, preliminarily and permanently barring
enforcement of a supermajority voting requirement in Article X of Dexter's
bylaws;
(c) on the Second Count, declaring that Dexter's poison pill
violates Connecticut law and is ultra vires, invalid, void and of no effect;
(d) on the Second Count, preliminarily and permanently barring
enforcement of Dexter's poison pill;
(e) on the Third Count, declaring that:
(i) the Nominee Election Proposals are valid under
Connecticut law and consistent with Dexter's certificate of incorporation, are
the proper subject for action by Dexter's shareholders and may be voted upon by
Dexter's shareholders at Dexter's 2000 annual meeting;
(ii) Dexter's shareholders have the lawful right to
increase the size of Dexter's board by amending Dexter's bylaws and to fill all
newly created directorships by majority vote at Dexter's 2000 annual meeting;
(f) on the Third Count, granting preliminary and permanent
injunctive relief permitting a shareholder vote on the Nominee Election
Proposals at the 2000 annual meeting;
(g) on the Fourth Count, declaring that:
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(i) the Shareholder Rights Proposals are valid under
Connecticut law and consistent with Dexter's certificate of incorporation, are
the proper subject for action by Dexter's shareholders and may be voted upon by
Dexter shareholders at Dexter's 2000 annual meeting;
(ii) Dexter shareholders have the lawful right to amend the
Dexter bylaws to require that Dexter's directors amend Dexter's poison pill or
redeem rights issued pursuant to Dexter's poison pill and prevent Dexter's
directors from adopting further poison pills without shareholder approval;
(h) on the Fourth Count, granting preliminary and permanent
injunctive relief permitting a shareholder vote on the Shareholder Rights
Proposals at the 2000 annual meeting;
(i) on the Fifth Count, declaring that the shareholders may
properly vote at the 2000 annual meeting on the Voting Rights Proposals;
(j) on the Fifth Count, granting preliminary and permanent
injunctive relief permitting a shareholder vote on the Voting Rights Proposals
at the 2000 annual meeting;
(k) on the Sixth Count, declaring that Dexter's directors may not
seek to impede or block an offer for all Dexter shares at a price of $45 per
share or more in cash by utilizing Dexter's poison pill or refusing to approve
the transaction under Section 33-844 of the Connecticut Business Corporation
Act;
(l) on the Sixth Count, preliminarily and permanently enjoining
the defendants, their employees, agents and all persons acting on their behalf
or in concert with them from seeking to impede or block an offer for all Dexter
shares at a
26
<PAGE>
price of $45 per share or more in cash by utilizing Dexter's poison pill or
refusing to approve the transaction under Section 33-844 of the Connecticut
Business Corporation Act;
(m) on the Sixth Count, declaring that the 2000 annual meeting of
Dexter's shareholders must be conducted no later than April 30, 2000;
(n) on the Sixth Count, granting preliminary and permanent
injunctive relief requiring that the 2000 annual meeting of Dexter's
shareholders be conducted no later than April 30, 2000;
(o) on the Sixth Count, awarding ISP all damages caused by
defendants' wrongful conduct;
(p) on all Counts, awarding ISP the costs and disbursements
incurred in this action, including attorneys' fees; and
(q) on all Counts, granting such other and further relief as this
Court may deem just and proper.
Dated: Westport, Connecticut
January 27, 2000
INTERNATIONAL SPECIALTY
PRODUCTS INC. and ISP
INVESTMENTS INC.
By: /s/ Marc J. Kurzman
-----------------------
Madeleine F. Grossman
Federal Bar No. ct05987
Marc J. Kurzman
Federal Bar No. ct01545
Dorit S. Heimer
Federal Bar No. ct01219
27
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LEVETT ROCKWOOD P.C.
33 Riverside Avenue
P.O. Box 5116
Westport, Connecticut 06881
Telephone: (203) 222-0885
Facsimile: (203) 226-8025
- and -
Greg A. Danilow
Stephen A. Radin
Seth Goodchild
WEIL, GOTSHAL & MANGES LLP
767 Fifth Avenue
New York, New York 10153
Telephone: (212) 310-8000
Facsimile: (212) 310-8007
28
<PAGE>
EXHIBIT A
BOARD SIZE BYLAW PROPOSAL
RESOLVED, that the Bylaws of Dexter Corporation be, and they hereby
are, amended, effective at the time this resolution is approved by the
shareholders of Dexter Corporation, by:
1. deleting the fourth sentence of Article III, Section 1, which reads
"[e]ach class of directorships shall consist of not less than one nor
more than five directorships", in its entirety;
2. adding a new fourth sentence of Article III, Section 1 as follows:
"At the annual meeting of the shareholders of the corporation held in
2000, additional directors shall be elected so that the Board of
Directors shall consist of seventeen directorships. The additional
directorships thereby created shall be allocated to the classes with
terms expiring at the annual meeting of the shareholders of the
corporation to be held in 2001 or 2002, unless allocated to a
different class by the Board of Directors consistent with Section
33-740 of the Connecticut Business Corporation Act"; and
3. adding a new final sentence of Article III, Section 1 as follows:
"The fourth sentence of this Section 1 may be altered, amended or
repealed only with the approval of the shareholders of the corporation
entitled to vote thereon in the manner set forth in Section 33-709(c)
of the Connecticut Business Corporation Act."
NY2:\872357\01\54104.0016
<PAGE>
THE ADDITIONAL DIRECTORS ELECTION PROPOSAL
RESOLVED, that each of the following persons be elected a director of
Dexter Corporation to fill the new directorships on the Board of Directors of
Dexter Corporation resulting from the adoption of the resolution amending
Article III, Section 1 of the Bylaws to increase the size of the Board, for a
term commencing at the time this resolution is adopted by the shareholders of
Dexter Corporation and shall be allocated into classes with terms continuing
until the annual meeting of the shareholders of Dexter Corporation to be held in
the year indicated below, and until the election and qualification of his
respective successor or until his earlier resignation or removal:
Alan Meckler 2002
Dan Ogden 2002
Morrison DeSoto Webb 2002
Robert Englander 2002
John Droney 2001
Anthony T. Kronman 2001
Vincent Tese 2001
; provided, that the Board of Directors may instead allocate certain of such
directorships to a different class, consistent with Section 33-740 of the
Connecticut Business Corporation Act.
2
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EXHIBIT B
THE POISON PILL BYLAW PROPOSAL
RESOLVED, that the Bylaws of Dexter Corporation be, and they hereby
are, amended, effective at the time this resolution is approved by the
shareholders of Dexter Corporation, by adding the following Section 7 to the end
of Article II:
"Section 7. Rights Agreements.
The Board of Directors, in exercising its rights and
duties with respect to the administration of the Rights Agreement,
dated as of August 23, 1996, as amended, by and between the
corporation and ChaseMellon Shareholder Services L.L.C., as Rights
Agent (the "Rights Agreement") will carry out a resolution
authorizing (i) the partial or complete redemption of the rights
issued pursuant to the Rights Agreement (the "Rights"), or (ii) an
amendment to the Rights Agreement making the Rights inapplicable to
offers or transactions or types of offers or transactions specified
in such resolution, if such resolution is authorized and approved by
the shareholders of the corporation entitled to vote thereon in the
manner set forth in Section 33-709(c) of the Connecticut Business
Corporation Act. In addition, the Board of Directors shall not adopt
any new shareholder rights plan, rights agreement or any other form
of "poison pill" which is designed to or has the effect of making
acquisitions of large holdings of the corporation's shares of capital
stock more difficult or expensive, unless such plan is first approved
by the shareholders of the corporation entitled to vote thereon in
the manner set forth in Section 33-709(c) of the Connecticut Business
Corporation Act. This Section 7 may be altered, amended or repealed
only with the approval of the shareholders of the corporation
entitled to vote thereon in the manner set forth in Section 33-709(c)
of the Connecticut Business Corporation Act."
3
<PAGE>
THE POISON PILL AMENDMENT PROPOSAL
RESOLVED, that the shareholders of Dexter Corporation hereby exercise
their right under Article II, Section 7 of the Bylaws of Dexter Corporation, as
amended on the date hereof, to require the Board of Directors to promptly amend
the Rights Agreement, dated as of August 23, 1996, as amended, by and between
Dexter Corporation and ChaseMellon Shareholder Services, L.L.C. (the "Rights
Agreement") to provide that the acquisition of beneficial ownership of shares of
common stock, par value $1.00 per share, of Dexter Corporation ("Common Stock")
pursuant to any offer for all outstanding shares of Common Stock for
consideration of at least $45 per share net to the seller in cash, shall
constitute a "Qualifying Offer" within the meaning of Sections 11(a)(ii) and
13(d) of the Rights Agreement.
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EXHIBIT C
THE BYLAW REPEAL PROPOSAL
RESOLVED, that any and all amendments made by the Board of Directors
of Dexter Corporation to the Bylaws of Dexter Corporation on or after February
26, 1999, be, and the same hereby are, repealed, and that, without the approval
of the shareholders of Dexter Corporation, the Board of Directors may not
thereafter amend any section of the Bylaws affected by such repeal or adopt any
new Bylaw provision which serves to reinstate any repealed provisions or any
similar provisions.
5
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THE OMNIBUS PROPOSAL
RESOLVED, that each of the proposals of International Specialty
Products Inc. and ISP Investments Inc. shall be voted upon by the shareholders
of Dexter Corporation at the 2000 Annual Meeting in the following order:
1. This Omnibus Proposal;
2. The Bylaw Repeal Proposal;
3. The Director Election Proposal;
4. The Board Size Bylaw Proposals;
5. The Additional Directors Election Proposal;
6. The Poison Pill Bylaw Proposal; and
7. The Poison Pill Amendment Proposal.
6
