<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 5
TO
SCHEDULE 14D-1
TENDER OFFER STATEMENT
(PURSUANT TO SECTION 14(D)(1) OF THE SECURITIES EXCHANGE ACT OF 1934)
HEALTHDYNE TECHNOLOGIES, INC.
(Name of Subject Company)
I.H.H. CORP.
INVACARE CORPORATION
(Bidders)
------------------------
COMMON STOCK, PAR VALUE $0.01 PER SHARE
(Title of Class of Securities)
18139610
(CUSIP Number of Class of Securities)
------------------------
THOMAS R. MIKLICH, ESQ.
CHIEF FINANCIAL OFFICER, GENERAL COUNSEL, TREASURER AND CORPORATE SECRETARY
INVACARE CORPORATION
899 CLEVELAND STREET
ELYRIA, OHIO 44035
TELEPHONE: (216) 329-6000
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications on Behalf of Bidders)
------------------------
COPY TO:
ROBERT E. SPATT, ESQ.
SIMPSON THACHER & BARTLETT
425 LEXINGTON AVENUE
NEW YORK, NEW YORK 10017-3954
TELEPHONE: (212) 455-2000
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<PAGE>
This Amendment No. 5 amends and supplements the Tender Offer Statement on
Schedule 14D-1 filed on January 27, 1997 (as amended, the "Schedule 14D-1")
relating to the offer by I.H.H. Corp., a Delaware corporation (the "Purchaser")
and a wholly owned subsidiary of Invacare Corporation, an Ohio corporation (the
"Parent"), to purchase all of the outstanding shares of Common Stock, par value
$0.01 per share (the "Shares"), of Healthdyne Technologies, Inc., a Georgia
corporation (the "Company"), and unless and until the Purchaser declares that
the Rights Condition as defined in the Offer to Purchase referred to below is
satisfied) the associated Preferred Stock Purchase Rights (the "Rights") issued
pursuant to the Rights Agreement, as amended, dated as of May 22, 1995, between
the Company and SunTrust Bank, Atlanta (formerly Trust Company Bank), as Rights
Agent, at a purchase price of $13 per Share (and associated Right), net to the
seller in cash, without interest thereon, upon the terms and subject to the
conditions set forth in the Offer to Purchase dated January 27, 1997 (the "Offer
to Purchase"), and in the related Letter of Transmittal. Unless otherwise
indicated, all capitalized terms used but not defined herein shall have the
meanings assigned to them in the Schedule 14D-1.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY
Item 3(b) of the Schedule 14D-1 is hereby amended and supplemented as
follows:
On March 20, 1997, the Parent delivered a notice ("Notice") to the Company
pursuant to the Company's By-Laws notifying the Company of the Parent's intent
to nominate a full slate of seven nominees for election to the Company's Board
of Directors at the Company's upcoming annual meeting of shareholders (the
"Annual Meeting") and of Parent's intent to propose a set of corporate
governance By-Law amendments for consideration by shareholders at the Annual
Meeting. The full text of the Notice is filed herewith as Exhibit (g)(2) and is
incorporated herein by reference. The full text of a press release issued by
Parent on March 20, 1997 with respect to the Notice is filed herewith as Exhibit
(a)(13) and is incorporated herein by reference.
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER.
Items 5(c) of the Schedule 14D-1 is hereby amended and supplemented as
follows:
See Item 3 above.
ITEM 10. ADDITIONAL INFORMATION.
Item 10(f) of the Schedule 14D-1 is hereby amended and supplemented as
follows:
On March 21, 1997, the Parent issued a press release regarding proposed
legislation in the Georgia legislature which, if adopted, would, among other
things, impose on all publicly held Georgia companies a "staggered board" scheme
and eliminate the right of shareholders of such companies to remove directors
without cause, unless the board of directors effectively chose not to be
governed by such provisions. The full text of the press release is set forth in
Exhibit 11(a)(14) and is incorporated herein by reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
Item 11 is hereby amended and supplemented to add the following:
(a)(13) Press Release issued by the Parent on March 20, 1997.
(a)(14) Press Release issued by the Parent on March 21, 1997.
(g)(2) Notice delivered by the Parent to the Company on March 20,
1997.
2
<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that
the information set forth in this Statement is true, complete and correct.
INVACARE CORPORATION
By: /s/ THOMAS R. MIKLICH
-----------------------------------------
Name: Thomas R. Miklich
Title: Chief Financial Officer
I.H.H. CORP.
By: /s/ THOMAS R. MIKLICH
-----------------------------------------
Name: Thomas R. Miklich
Title: President
Date: March 21, 1997
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT PAGE
NO. DESCRIPTION NO.
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<S> <C> <C>
11(a)(13) Press Release issued by the Parent on March 20, 1997..........................................
11(a)(14) Press Release issued by the Parent on March 21, 1997..........................................
11(g)(2) Nomination Notice delivered by the Parent to the Company on March 20, 1997....................
</TABLE>
<PAGE>
[MACKENZIE PARTNERS LOGO]
156 FIFTH AVENUE
NEW YORK, NY 10010
212 929-5500
FAX 212 929-0308
CONTACT:
Mark H. Harnett
MacKenzie Partners, Inc.
(212) 929-5877
FOR IMMEDIATE RELEASE:
INVACARE SUBMITS BOARD SLATE AND PROPOSALS TO
HEALTHDYNE TECHNOLOGIES FOR ANNUAL MEETING.
ELYRIA, OHIO, March 20, 1997 -- Invacare Corporation (NASDAQ/NMS:IVCR) announced
today that it has provided notice to Healthdyne Technologies, Inc.
(NASDAQ/NMS:HDTC) of its intention to nominate seven director candidates at
Healthdyne's upcoming (but as yet unscheduled) 1997 annual meeting.
In the notice given to Healthdyne, Invacare also submitted a set of corporate
governance bylaw amendments for consideration by shareholders at the annual
meeting. The proposed amendments are designed to facilitate the change in the
Board and the consummation of Invacare's fully-financed, premium tender offer;
prevent manipulation by the current Board of Healthdyne's by-laws and of the
size of the Board to be elected at the annual meeting; allow for a special
meeting to be called by shareholders owning 10% of the Company's stock; and
cause the existing Board to eliminate the Company's "dead-hand" pill provisions.
Invacare has submitted the slate and proposals to Healthdyne at this time in
order to comply with the Company's advance notification bylaw, which requires
notifying Healthdyne prior to Tuesday, March 25, 1997.
A. Malachi Mixon, III, Chairman and Chief Executive Officer of Invacare, said,
"We are very proud to assemble this exceptionally strong slate of seven
well-qualified, independent candidates. Given the Company's refusal to date to
sit down and talk to us regarding our fully-financed, premium tender offer, we
are forced to take this action now to preserve our rights to seek replacement of
the Board and make related proposals at the annual meeting."
"We urge the Board of Healthdyne to spare their shareholders the expense and
delay of proceeding with a proxy contest, abandon their 'not-for-sale' position
and begin discussions with us so that all shareholders can receive immediate
value for their investment."
Although Healthdyne held last year's annual meeting on May 23 and the previous
year's meeting in April, it has yet to announce either a record date or meeting
date for the 1997 annual meeting. Thomas R. Miklich, Chief Financial Officer
and General Counsel of Invacare, said, "Shortly after we announced our interest
in acquiring Healthdyne, their Board of Directors amended their bylaws to
eliminate the long-standing provision that set the fourth Tuesday in April as
the date for annual meetings unless an alternative date was designated by the
Board. Invacare believes that the Healthdyne Board is obligated by its
fiduciary duties and Georgia law to hold its annual meeting promptly and intends
to request the courts to order the meeting to be held if Healthdyne does not
call the meeting on a timely basis."
- more -
<PAGE>
Invacare Corporation
March 20, 1997
Page Two
The Invacare candidates nominated for election at the annual meeting are Messrs.
Nicholas J. DiCicco, Jr., Donald F. Hastings, Jack Kahl, Jr., Ernest Peter
Mansour, Jon H. Outcalt, James Allen Rutherford and Bill R. Sanford.
Mr. DiCicco has been President and Chief Executive Officer of Midwestern
National Life Insurance Company of Ohio since 1975.
Mr. Hastings has been Chairman of the Board of the Lincoln Electric Company, a
welding products manufacturer, since 1992, and was also Chief Executive Officer
of The Lincoln Electric Company from 1992 to 1996.
Mr. Kahl has been Chairman of the Board and Chief Executive Officer of Manco,
Inc., a company specializing in the production of heavy duty adhesive tape,
since 1971. He is currently a member of the Board of Directors of Royal
Appliance MFG. Co. and Applied Industrial Technologies, Inc.
Mr. Mansour is managing partner of the Cleveland law firm of Mansour, Gavin,
Gerlack & Manos Co., L.P.A.
Mr. Outcalt has been Chairman of the Board of NCS Healthcare, Inc. since 1986
and Senior Vice President of Alliance Capital Management from 1975 until 1995.
He serves on the Boards of Myers Industries, Inc. and Ohio Savings Financial
Corp.
Mr. Rutherford is Chairman and Managing Director of Wingset Investments Ltd., a
technology venture fund. He is a member of the of the Boards of Ciber, Inc. and
Symix Systems, Inc.
Mr. Sanford is Chairman, President and Chief Executive Officer of STERIS
Corporation, an infection prevention and surgical support company. He is a
Board member of KeyBank, N.A.
Invacare's $13 per share tender offer is currently scheduled to expire at 6:00
p.m. on Monday, March 24, 1997, unless extended.
# # #
PARTICIPANT INFORMATION
Invacare may solicit proxies for Healthdyne's 1997 annual meeting with
respect to the above-described nominees and proposals. Besides Invacare and
the nominees, other participants in this solicitation may include the
following directors and/or executive officers of Invacare; A. Malachi Mixon,
III (Chairman, Chief Executive Officer and Director), Gerald B. Blouch
(President and Chief Operating Officer), Thomas R. Miklich (Chief Financial
Officer, Secretary, General Counsel and Treasurer), J.B. Richey, III (Senior
Vice President--Total Quality Management and Director), Donald P. Andersen
(Group Vice President--Respiratory Products) and Louis F.J. Slangen (Senior
Vice President--Sales & Marketing). Although Salomon Brothers Inc ("Salomon
Brothers"), which is acting as dealer manager in connection with the tender
offer and serving as financial advisor to Invacare in connection with the
proposed acquisition of Healthdyne, does not admit that it or any of its
directors, officers, employees or affiliates is a "participant", as defined
in Schedule 14A promulgated by the Securities and Exchange Commission under
the Securities Exchange Act of 1934, as amended, or that such Schedule 14A
requires the disclosure of certain information concerning them, the following
employees of Salomon Brothers may assist Invacare in such a solicitation:
Scott Wilson (Managing Director), Wilder Fulford (Managing Director), John
Fowler (Managing Director), John Chambers (Director) and Sarah Barnes (Vice
President).
<PAGE>
Invacare Corporation
March 20, 1997
Page Three
Invacare beneficially owns an aggregate of 600,000 shares of Healthdyne's
common stock. Salomon Brothers will receive customary financial advisor and
dealer manager fees, reimbursement and indemnification from Invacare in
connection with the tender offer and any acquisition by Invacare of
Healthdyne. Salomon Brothers will not receive any additional fee for or in
connection with assisting in any solicitation of proxies. Salomon Brothers
engages in a full range of investment banking, securities trading,
market-making and brokerage services for institutional and individual
clients. In the ordinary course of its business, Salomon Brothers maintains
customary arrangements and effects transactions in the securities of
Healthdyne for the accounts of its customers. As a result of its engagement
by Invacare, Salomon Brothers has restricted its proprietary trading in the
securities of Healthdyne (although it may still execute trades for customers
on an unsolicited agency basis).
<PAGE>
NEWS RELEASE
[MACKENZIE PARTNERS LOGO]
156 FIFTH AVENUE
NEW YORK, NY 10010
212 929-5500
FAX 212 929-0308
CONTACTS:
Bruce Hawthorne; Robert P. Bryant
King & Spalding
(404) 572-4600
Mark H. Harnett
MacKenzie Partners, Inc.
(212) 929-5877
FOR IMMEDIATE RELEASE:
INVACARE FAULTS PROPOSED GEORGIA LAW MANDATING
STAGGERRED BOARDS FOR GEORGIA COMPANIES;
SUSPECTS HEALTHDYNE TECHNOLOGIES BEHIND PROPOSAL
ELYRIA, OHIO, March 21, 1997 - A. Malachi Mixon, III, Chairman and Chief
Executive Officer of Invacare Corporation (NASDAQ/NMS:IVCR) made the following
comment regarding an anti-takeover proposal introduced yesterday as a last
minute amendment to a routine bill in the Georgia legislature. This bill could
be passed as early as today and, if adopted, would have a substantial adverse
impact on shareholders of Healthdyne Technologies, Inc. (NASDAQ/NMS:HDTC) and
other public Georgia companies which elect their entire Board of Directors
annually:
"We are incredulous to find out that an eleventh hour bill has been introduced
that would impose a "staggered board" scheme on all publicly-held Georgia
companies. Under a staggered board scheme only one third of a board would stand
for election each year, thus entrenching the remaining two thirds. Virtually
every state in America requires a shareholder vote to approve a staggered board.
The effect of this proposed bill would be to deprive all investors in Georgia
publicly traded companies of their right to decide whether they should be able
to elect an entire board at each year's meeting. The bill also contains other
provisions that would entrench management at the expense of shareholders,
including stripping shareholders of their current right to remove directors for
any reason."
"We strongly suspect that Healthdyne's board and management, who are the most
obvious beneficiaries of this bill, are behind this proposal. This proposed
bill was introduced on the same day that Healthdyne received Invacare's notice
of nomination of directors to replace the entire Healthdyne board of directors
at their upcoming annual meeting."
"Without this bill Healthdyne's entire Board must stand for re-election at the
upcoming 1997 Annual Meeting. This bill, if passed, would entrench the Board
well into 1998 and permit the Board to frustrate the wishes of the rightful
owners of Healthdyne. Shareholders of Georgia corporations like Healthdyne
should continue to have the right to make this basic governance decision, not
the state legislature."
"We hope the Georgia legislature will recognize this last minute bill for what
it is: an attempt to entrench the incumbent management of one company at the
expense of shareholders of all Georgia companies."
"Shareholders of all Georgia companies who elect their entire Board annually,
including Healthdyne, should be outraged at this bill and should contact the
Georgia legislature and Governor and the management of their companies as soon
as possible to express their opposition."
- more -
<PAGE>
Proposed Georgia Legislation
March 21, 1997
page 2
As previously announced, Invacare is proposing a slate of seven director
nominees and set of corporate governance bylaw amendments for consideration by
shareholders at the annual meeting. The Invacare candidates nominated for
election at the annual meeting are Messrs. Nicholas J. DiCicco, Jr., Donald F.
Hastings, Jack Kahl, Jr., Ernest Peter Mansour, Jon H. Outcalt, James Allen
Rutherford and Bill R. Sanford. The proposed amendments are designed to
facilitate the change in the Board and the consummation of Invacare's
fully-financed, premium tender offer; prevent manipulation by the current Board
of Healthdyne's by-laws and of the size of the Board to be elected at the annual
meeting; allow for a special meeting to be called by shareholders owning 10% of
the Company's stock; and cause the existing Board to eliminate the Company's
"dead-hand" pill provisions.
Invacare's $13 per share tender offer is currently scheduled to expire at 6:00
p.m. on Monday March 24, 1997, unless extended.
PARTICIPANT INFORMATION
Invacare may solicit proxies for Healthdyne's 1997 annual meeting with respect
to the above-described nominees and proposals. Besides Invacare and the
nominees, other participants in this solicitation may include the following
directors and/or executive officers of Invacare: A. Malachi Mixon, III
(Chairman, Chief Executive Officer and Director), Gerald B. Blouch (President
and Chief Operating Officer), Thomas R. Miklich (Chief Financial Officer,
Secretary, General Counsel and Treasurer), J.B. Richey, III (Senior Vice
President--Total Quality Management and Director), Donald P. Andersen (Group
Vice President--Respiratory Products) and Louis F.J. Slangen (Senior Vice
President--Sales & Marketing). Although Salomon Brothers Inc ("Salomon
Brothers"), which is acting as dealer manager in connection with the tender
offer and serving as financial advisor to Invacare in connection with the
proposed acquisition of Healthdyne, does not admit that it or any of its
directors, officers, employees or affiliates is a "participant", as defined in
Schedule 14A promulgated by the Securities and Exchange Commission under the
Securities Exchange Act of 1934, as amended, or that such Schedule 14A requires
the disclosure of certain information concerning them, the following employees
of Salomon Brothers may assist Invacare in such a solicitation: Scott Wilson
(Managing Director), Wilder Fulford (Managing Director), John Fowler (Managing
Director), John Chambers (Director) and Sarah Barnes (Vice President).
Invacare beneficially owns an aggregate of 600,000 shares of Healthdyne's common
stock. Salomon Brothers will receive customary financial advisor and dealer
manager fees, reimbursement and indemnification from Invacare in connection with
the tender offer and any acquisition by Invacare of Healthdyne. Salomon Brothers
will not receive any additional fee for or in connection with assisting in any
solicitation of proxies. Salomon Brothers engages in a full range of investment
banking, securities trading, market-making and brokerage services for
institutional and individual clients. In the ordinary course of its business,
Salomon Brothers maintains customary arrangements and effects transactions in
the securities of Healthdyne for the accounts of its customers. As a result of
its engagement by Invacare, Salomon Brothers has restricted its proprietary
trading in the securities of Healthdyne (although it may still execute trades
for customers on an unsolicited agency basis).
# # #
<PAGE>
March 20, 1997
To: Secretary of Healthdyne Technologies, Inc.
1255 Kennestone Circle
Marietta, Georgia 30066
NOTICE OF BUSINESS TO BE BROUGHT BEFORE THE 1997 ANNUAL MEETING
OF SHAREHOLDERS OF HEALTHDYNE TECHNOLOGIES, INC.
I. INTRODUCTION
Invacare Corporation, an Ohio corporation, is the beneficial owner of
600,000 shares of common stock ("Common Stock"), par value $0.01 per share, of
Healthdyne Technologies, Inc., a Georgia corporation (the "Company"),
representing in the aggregate approximately 4.7% of the Company's outstanding
Common Stock (based on the most recent information provided to Invacare by the
Company). Invacare is the record owner of 100 shares of Common Stock. This
notice (the "Notice") of the intention of Invacare to make nominations at and
bring business before the 1997 Annual Meeting of Shareholders of the Company
(including any adjournment or postponement thereof) (the "Annual Meeting") is
being made pursuant to and in reliance on Article I, Section 6 of the Bylaws of
the Company (the "Notice Requirements"), as such Bylaws were provided to
Invacare by the Company on February 5, 1997. If the Bylaws have been changed
from the form referenced above, Invacare hereby demands that the Company
promptly notify it of any such changes.
It is Invacare's current intention to appear in person and/or by proxy
at the Annual Meeting to (i) nominate the Invacare Nominees (as defined below)
and (ii) introduce the other matters which are briefly described in Section III
below for consideration by the
<PAGE>
2
shareholders of the Company. The address of Invacare is 899 Cleveland Street,
Elyria, Ohio 44035.
A wholly owned subsidiary of Invacare, I.H.H. Corp. ("I.H.H."), has
commenced an offer to purchase all of the outstanding Common Stock and the
associated Preferred Stock Purchase Rights (the "Rights") at a purchase price of
$13 per share of Common Stock (and associated Right), net to the seller in cash
without interest thereon, upon the terms and subject to the conditions set forth
in the Offer to Purchase dated January 27, 1997 and in the related Letter of
Transmittal (which, as amended from time to time, together constitute the
"Offer"). The purpose of the Offer is to acquire control of, and the entire
equity interest in, the Company. Invacare intends to propose, and to seek to
have the Company consummate as soon as practicable after consummation of the
Offer, a merger or similar business combination (the "Merger") with I.H.H. or
another direct or indirect subsidiary of Invacare, pursuant to which each then
outstanding share of Common Stock (other than shares of Common Stock held by
Invacare, I.H.H. or any other wholly owned subsidiary of Invacare, shares of
Common Stock held in the treasury of the Company and shares of Common Stock held
by shareholders who properly exercise appraisal rights under Georgia law) would
be converted into the right to receive in cash the price per share of Common
Stock paid by I.H.H. pursuant to the Offer. Invacare desires to propose the
following business at the Annual Meeting in order to facilitate the Offer and
the Merger. A description of the background of the Offer is contained in
Invacare's Tender Offer Statement on Schedule 14D-1 which was delivered to the
Company on January 27, 1997, and is incorporated herein by reference.
<PAGE>
3
II. NOMINATION OF DIRECTORS
At the Annual Meeting, Invacare intends to nominate the seven (7)
individuals named in Appendix I hereto (the "Invacare Nominees") for election
to the Board of Directors of the Company. Based on the current size of the
Board of Directors on the date hereof as reflected in the Company's most
recent public filings, the slate of Invacare Nominees would, after its
election, constitute the entire Board of Directors of the Company. All of
the Invacare Nominees are committed to taking all such actions necessary or
appropriate (subject to any fiduciary duties they would have as directors) to
approve and effectuate the consummation of the Offer and the Merger. Set
forth in Appendix I attached hereto, which is incorporated herein by
reference, is the additional information required to be provided under the
Notification and Proposal Requirements with respect to the Invacare Nominees.
Each of the Invacare Nominees has consented in writing to being named in the
proxy statement relating to his nomination and to serving as a director of
the Company if elected; copies of consents of the Invacare Nominees are
available from Invacare upon request.
If the number of members of the Board of Directors is or becomes (by
action of the Board or otherwise) greater than seven (7), Invacare hereby
demands that the Company promptly notify it of such increase and reserves the
right to nominate a number of additional Invacare Nominees so that the total
number of Invacare Nominees is equal to the increased number of members of the
Board of Directors. Invacare undertakes to provide promptly to the Company the
information required with respect to any such additional nominees following the
receipt by Invacare of notice of such increase. If, for any reason, any
Invacare Nominee named herein is unable to serve as a director of the Company,
Invacare reserves the right to
<PAGE>
4
replace such Invacare Nominee and undertakes to provide the Company promptly the
information required with respect to any such replacement nominee.
III. SHAREHOLDER PROPOSALS
Invacare currently intends to introduce at the Annual Meeting
shareholder proposals (the "Shareholder Proposals") for consideration by the
shareholders of the Company which are intended to facilitate the Offer and the
Merger, among other things, by (i) ensuring that the shareholders of the Company
will have the opportunity to elect the Invacare Nominees as all of the directors
of the Company, or any lesser proportion as the shareholders should desire, (ii)
limiting the authority of the Board of Directors of the Company to impose or
permit to exist certain restrictions on the ability of any future Board to
exercise its power and authority, including certain restrictions with respect to
amending the Rights plan or redeeming the Rights, (iii) preventing the Board of
Directors of the Company from taking certain actions with respect to the Bylaws
without the approval of the shareholders of the Company and (iv) increasing the
ability of the shareholders of the Company to demand special meetings in order
to exercise oversight of the Board of Directors of the Company, change the
composition of the Board of Directors and/or take other appropriate shareholder
actions from time to time between Annual Meetings, including the following:
(1) A proposal, to be considered prior to the election of directors at the
Annual Meeting, to amend the Bylaws to fix the maximum number of
directors of the Company at seven (7) and to provide that such Bylaw
may not be further amended, or any new Bylaw provision which is in
any manner inconsistent therewith be adopted, without the approval
of the shareholders;
(2) A proposal, to be considered prior to the election of directors at the
Annual Meeting, to amend the Bylaws to provide that the Board of
Directors shall have no authority to take any action, or omit to take
any action, the effect of which action or omission would be to impose,
or permit to continue or be imposed, any limitation (directly or
indirectly, and including any such limitation imposed by means of a
requirement for concurrence or other action by any particular
<PAGE>
5
director or particular type of director), resulting from or becoming
operative in light of in whole or in part, a change in the
composition of the Board of Directors (whether or not under
specified circumstances), on the exercise by any future Board of
Directors of any power or authority that it would otherwise have,
including any such limitation on the ability of a Board of Directors
to redeem or amend any shareholder rights plan of the Company which
limitation results from or becomes operative in light of, in whole or
in part, a change in the composition of the Board of Directors
(whether or not under specified circumstances). In particular, but
not in limitation, such amendment will also specifically provide that
the incumbent Board of Directors will be in violation of the Bylaws
if such Board, including any requisite group of "continuing
directors", fails to immediately take all necessary action (prior to
the consideration of the election of directors at the Annual Meeting)
to amend any shareholder rights plan of the Company to remove all such
limitations; Such amendment will further provide that such Bylaw may
not be amended, or any new Bylaw provision which is in any manner
inconsistent therewith be adopted, without the approval of the
shareholders;
(3) A proposal to repeal each and every provision of the Bylaws of the
Company or amendments thereto which was adopted on or after June 30,
1996 and prior to the date of adoption of such proposal, other than
those provisions which were fully disclosed and properly reflected in
the public filings made by the Company with the Securities and
Exchange Commission prior to the date of this Notice and those
provisions which were duly approved by the shareholders; and to
provide that, without the approval of the shareholders, the Board of
Directors may not thereafter amend any section of the Bylaws affected
by such repeal or adopt any new Bylaw provision in a manner which
serves to reinstate any repealed provision or any similar provision;
(4) A proposal to amend the Bylaws to (a) give the holders of 10% or more
of the outstanding Common Stock the right to demand a special meeting
and (b) provide definitive procedures with respect to such meeting,
including (i) setting the date of such meeting, (ii) setting record
dates in connection with such demand and meeting, (iii) giving notice
of such meeting and (iv) establishing the business to be conducted at
such meeting; and to provide that such Bylaw may not be further
amended, or any new Bylaw provision which is in any manner
inconsistent therewith be adopted, without the approval of the
shareholders; and
(5) Other proposals as are necessary or desirable in furtherance of the
foregoing.
IV. GENERAL
If this Notice shall be deemed for any reason by a court of competent
jurisdiction to be ineffective with respect to the nomination of one or more of
the Invacare Nominees at the Annual Meeting or the proposal of one or more of
the Shareholder
<PAGE>
6
Proposals, this Notice shall continue to be effective with respect to all
other Invacare Nominees and/or Shareholder Proposals and as to any suitable
replacement nominees selected or proposals made by Invacare. Invacare
undertakes to provide the information required with respect to any such
replacement nominees or proposals as soon as practicable following the
receipt by Invacare of notice that this Notice is so ineffective. While it
is Invacare's present intention to nominate the Invacare Nominees and make
the Shareholder Proposals at the Annual Meeting, Invacare also reserves the
right, in light of changed circumstances existing at the time, not to
nominate, one or more of the Invacare Nominees and/or not to make one or more
of the Shareholder Proposals, each of which nominations and proposals are
individual and independent of the others.
Except as disclosed elsewhere herein, there are no arrangements or
understandings between Invacare and any other person or persons in connection
with the nominations and proposals made hereby other than Invacare's retention
of various financial advisors, attorneys, accountants, proxy solicitors and
other professionals on customary terms.
This Notice complies with the Notice Requirements and all other
applicable requirements. If, for any reason, the Company anticipates that any
director or officer of the Company or any chairman of the Annual Meeting may
determine that this Notice (or any part of this Notice) was not properly made in
accordance with the Notice Requirements or any other applicable requirements,
Invacare hereby demands that you provide Invacare prompt notice to that effect
sufficiently in advance of the Annual Meeting so that any claimed deficiency in
this Notice may be corrected.
<PAGE>
7
IN WITNESS WHEREOF, Invacare Corporation has hereby caused this Notice
to be executed on the date first written above by its duly authorized officer.
INVACARE CORPORATION
/s/ Thomas R. Miklich
_______________________________
Name: Thomas R. Miklich
Title: Chief Financial Officer
<PAGE>
APPENDIX I
INFORMATION CONCERNING THE INVACARE NOMINEES
To the knowledge of Invacare:
1. Set forth in the table below is the name, age and principal occupations
and employment during the past five years of each of the Invacare Nominees and
the name and principal business of any corporation or other organization in
which such occupations and employment were carried on, and the present principal
business address and public directorships of each of the Invacare Nominees.
NAME, AGE AND PRINCIPAL OCCUPATION AND BUSINESS EXPERIENCE
PRINCIPAL BUSINESS ADDRESS DURING LAST FIVE YEARS; CURRENT DIRECTORSHIPS
Nicholas J. DiCicco, Jr, 64. . President and Chief Executive Officer of
6650 Beta Drive Midwestern National Life Insurance Company of
Mayfield Village, Ohio 44143 Ohio since 1975.
Donald F. Hastings, 68 . . . . Chairman, The Lincoln Electric Company, a
22801 St. Claire Avenue welding products manufacturer, since 1992.
Cleveland, Ohio 44117 Chief Executive Officer of The Lincoln
Electric Company from 1992 to 1996.President
and Chief Operating Officer of The Lincoln
Electric Company from 1987 to 1992.
Jack Kahl, Jr., 56 . . . . . . Chairman of the Board and Chief Executive
32150 Just Imagine Drive Officer of Manco, Inc., a company
Avon, Ohio 44011-1355 specializing in the production of heavy-duty
adhesive tape, since 1971. Currently a
member of the Board of Directors of Royal
Appliance MFG. Co. and Applied Industrial
Technologies, Inc.
Ernest Peter Mansour, 66 . . . Attorney and Managing Partner of Mansour,
55 Public Square, Suite 2150 Gavin, Gerlack & Manos Co., L.P.A., a
Cleveland, Ohio 44113 Cleveland law firm, since 1981.
Jon H. Outcalt, 60 . . . . . . Chairman of the Board of NCS HealthCare, Inc.
3201 Enterprise Parkway, #220 since 1986. Senior Vice President of
Beachwood, Ohio 44122 Alliance Capital Management L.P., a money
management firm, from 1975 to 1995.
Currently a member of the Board of Directors
of Myers Industries, Inc. and Ohio Savings
Financial Corp.
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NAME, AGE AND PRINCIPAL OCCUPATION AND BUSINESS EXPERIENCE
PRINCIPAL BUSINESS ADDRESS DURING LAST FIVE YEARS; CURRENT DIRECTORSHIPS
James Allen Rutherford, 51 . . Chairman and Managing Director of Wingset
15 S. High St. Investments Ltd. and President of Wingset,
P.O. Box 166 Inc., technology venture funds, from 1993 to
New Albany, Ohio 43054 present. Former Chairman of Countrysport,
Inc., a sports book publisher, from 1994 to
1996. Retired from position of Chairman,
Goal Systems International, Inc., a software
vending company, in 1992. Currently a member
of the Board of Directors of Ciber, Inc. and
Symix Systems, Inc.
Bill R. Sanford, 53 . . . . . Chairman of the Board, President and Chief
5960 Heisley Road Executive Officer of STERIS Corporation, an
Mentor, Ohio 44060 infection prevention and surgical support
company, since 1987. Currently a member of
the Board of Directors of KeyBank, N.A.
2. Set forth below is the name and residence address of each of the
Invacare Nominees.
Nicholas J. DiCicco, Jr.
1185 Foxville Drive
P.O. Box 636
Gates Mills, Ohio
Donald F. Hastings
3205 Fox Hollow Drive
Pepper Pike, Ohio 44124
Jack Kahl, Jr.
391 Darby's Run
Bay Village, Ohio 44140
Ernest Peter Mansour
22525 Shaker Boulevard
Shaker Heights, Ohio 44122
Jon H. Outcalt
14505 Hartwell Trail
Novelty, Ohio 44072
James Allen Rutherford
480 Delegate Drive
Columbus, Ohio 43235
Bill R. Sanford
4745 Sherwin Road
Willoughby, Ohio 44094
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3. Within the past ten years, none of the Invacare Nominees has been
convicted in a criminal proceeding (excluding traffic violations and similar
misdemeanors).
4. Other than as disclosed herein, none of the Invacare Nominees has any
substantial interest, direct or indirect, by security holdings or otherwise, in
any matter to be acted upon at the Annual Meeting. As a group, the Invacare
Nominees own in the aggregate less than 1/2% of the total number of shares of
Invacare common stock outstanding as of March 20, 1997.
5. As of the close of business on the date of this notice, Invacare was the
beneficial owner of 600,000 shares of Common Stock, representing approximately
4.7% of the outstanding Common Stock (based on the most recent information
provided to Invacare by the Company). No Invacare Nominee is the beneficial or
record owner, directly or indirectly, of any securities of the Company, or any
subsidiary of the Company, nor has any Invacare Nominee purchased or sold any
securities of the Company within the past two years. Other than as otherwise
set forth herein, no other associate of the Invacare Nominees owns beneficially,
directly or indirectly, any securities of the Company, any parent of the Company
or any subsidiary of the Company. None of the Invacare Nominees is or 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 profit, division of losses or profits,
or the giving or withholding of proxies.
6. Other than as disclosed herein, none of the Invacare Nominees, any of
their associates or any immediate members of their family has or will have any
direct or indirect material interest in any transaction or series of similar
transactions since January 1, 1996 or any currently projected transaction or
series of similar transactions to which the Company or any of its subsidiaries
was or is to be a party in which the amount involved exceeds $60,000 or any
relationship described in Item 404(b) of Regulation S-K, and none
of the Invacare Nominees or any associate of the Invacare Nominees has any
arrangement or understanding with any person (A) with respect to future
employment by the Company or its affiliates or (B) with respect to any future
transactions to which the Company or any of its affiliates will or may be a
party except as otherwise provided herein. None of the Invacare Nominees or any
associate of the Invacare Nominees has been indebted to the Company or its
subsidiaries at any time since January 1, 1996, the beginning of the Company's
last fiscal year, in an amount in excess of $60,000. From time to time, the law
firm of Mansour, Gavin, Gerlack & Manos Co., L.P.A., of which Mr. Mansour is a
partner, has provided legal services to Invacare and its affiliates and is
expected to do so in the future.
7. Upon the filing by Invacare with the Commission of a definitive proxy
statement with respect to the election of the Invacare Nominees to the Board of
Directors of the Company, Invacare has agreed to pay each Invacare Nominee a fee
in the amount of $10,000. Invacare has also agreed to indemnify each of the
Invacare Nominees against any expenses (including legal fees) and liabilities
arising out of participation in the proxy solicitation. According to the
Company's public filings with the Commission, if elected as directors of the
Company, each Invacare Nominee would receive from the Company a director's fee
of $3,000 per quarter, plus $1,000 for each Board meeting and $750 for each
committee meeting attended, and would be reimbursed for any travel expense
incurred. Invacare also believes that, if elected, the Invacare Nominees would
be indemnified by the Company to the extent
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indemnification is provided in the Company's Articles of Incorporation and
By-Laws. Invacare disclaims any responsibility for the accuracy of the foregoing
information which has been extracted from the Company's public filings.
8. There are no material proceedings in which any of the Invacare Nominees
or any of their associates is a party adverse to the Company or any of its
subsidiaries, or proceedings in which such nominees or associates have a
material interest adverse to the Company or any of its subsidiaries.
9. No occupation or employment carried on by any of the Invacare Nominees
in the past five years has been with the Company or any corporation or
organization which is or was a subsidiary or other affiliate of the Company
and none of the Invacare Nominees have ever served on the Company's Board of
Directors.
10. Other than as disclosed herein, there are no arrangements or
understandings between any of the Invacare Nominees and any other party pursuant
to which any such nominee was or is to be selected as a director of the Company.
11. There exist no family relationships among the Invacare Nominees or
between any of the Invacare Nominees and any director or executive officer of
the Company.
12. During the last five years none of the Invacare Nominees were involved
in any of the events described in Item 401(f) of Regulation S-K.
13. None of the Invacare Nominees or any of their associates has received
any cash compensation, cash bonus, deferred compensation, compensation pursuant
to plans, or other compensation from, or in respect of services rendered on
behalf of, the Company, or is subject to any other arrangement described in Item
402 of Regulation S-K.
14. Each of the Invacare Nominees is a citizen of the United States.
