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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 28
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)
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COMMON STOCK, PAR VALUE $0.01 PER SHARE
(Title of Class of Securities)
18139610
(CUSIP Number of Class of Securities)
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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)
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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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This Amendment No. 28 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 $15 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, as amended
and supplemented by the Supplements thereto dated April 4, 1997 and June 6, 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.
The Schedule 14D-1 is hereby amended and supplemented as follows:
On July 18, 1997, the Company filed a Memorandum of Law with the Court in
the Defensive Tactics Litigation in opposition to the Parent and the Purchaser's
pending emergency motion regarding the Company's obligation to call the
Dead-Hand Elimination Proposal for a vote at the Annual Meeting and have the
results of such vote calculated and reported. On July 22, 1997, the Parent and
the Purchaser filed a Reply Brief in support of the motion. The full text of the
Parent and the Purchaser's Reply Brief is set forth in Exhibit 11(g)(23).
On July 23, 1997, A. Malachi Mixon, III, Chairman and Chief Executive
Officer of the Parent, sent a letter to the Company's shareholders, the full
text of which is set forth in Exhibit 11(g)(24).
On July 23, 1997, the Parent issued a press release, the full text of which
is set forth in Exhibit 11(a)(42) and is incorporated herein by reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
(a)(42) Press Release issued by the Parent on July 23, 1997.
(g)(23) Reply Brief filed by the Parent and the Purchaser dated July 22,
1997.
(g)(24) Letter to Shareholders dated July 23, 1997.
2
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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: July 23, 1997
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EXHIBIT INDEX
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EXHIBIT PAGE
NO. DESCRIPTION NO.
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Exhibit 11(a)(42) Press Release issued by the Parent on July 23, 1997.
Exhibit 11(g)(23) Reply Brief filed by the Parent and the Purchaser dated July 22, 1997.
Exhibit 11(g)(24) Letter to Shareholders dated July 23, 1997.
</TABLE>
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FOR IMMEDIATE RELEASE
Contact: Mark H. Harnett
MacKenzie Partners, Inc.
(212) 929-5877
INVACARE BRANDS HEALTHDYNE RELEASE ILLUSORY AND
CRITICIZES FAILURE TO PRODUCE DEAL;
Continues Proxy Fight but Plans to Protect Investment
Now by Selling Some or All of its Healthdyne Stock
Elyria, Ohio -- (July 23, 1997) -- A. Malachi Mixon, III, Chairman and
Chief Executive Officer of Invacare Corporation (NASDAQ/NMS:IVCR), made the
following statement in response to the press release issued by Healthdyne
Technologies, Inc. (NASDAQ/NMS:HDTC) earlier this morning:
"Healthdyne's incumbent board continues to try to get re-elected on nothing
but rhetoric and empty promises. Mr. Petit's statement that they will accept
the best proposal only 'as long as it reflects the true value of the company'
makes it perfectly clear, as they have all along, that they are insistent on
substituting their judgment for the shareholders' and that they have no
commitment to selling the company."
"They have had a full month after announcing their intention to 'explore
alternatives' (and more than six months after we made our first acquisition
proposal) to negotiate and announce a sale transaction. If they were serious
about selling the company, they would have announced a deal by now."
"Their offer to reduce the special meeting demand threshold to 25% on
October 31, 1997 if they are re-elected may initially sound appealing, but is in
fact yet another ploy. Nothing in their release suggests that they would change
any of the other onerous procedures they have put in place, including their
ability to delay a special meeting for more than four months after receiving
valid demands -- so that the earliest such special meeting would likely be as
late as March (only one month earlier than their typical annual meeting). Only
the adoption of our By-Laws Repeal Proposal and Special Meeting Proposal will
give shareholders the power they need to call a prompt special meeting."
"Likewise, their suggested provisions permitting shareholders to pull the
poison pill are illusory. For the past six months (ever since we made our first
acquisition proposal), the market price of Healthdyne's stock has included an
acquisition premium based on speculation that the company would be sold to us or
another bidder. Since the mechanism is limited only to bidders who make an
offer 15% above the market price, even a bidder offering as much as $20.50 today
(based on today's current $18 market high) would not be able to use it.
Although this mechanism might be useful for a typical company not already 'in
play', this 'double-counting' effect when applied to Healthdyne makes their
suggested provisions essentially useless."
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"We have no objection to any of the current directors, including Messrs.
Petit, Reynolds and Yokubinas, continuing to serve in the minority seats we have
been forced to leave unopposed. But we think that the shareholders should be
outraged at their approval of a $1 million 'slush fund' to be used solely by the
minority as yet another director-entrenching fright tactic which Healthdyne and
its shareholders can ill afford."
"Despite all of Healthdyne's delaying, defensive and evasive actions and
statements to date, we will continue to pursue our proxy contest at the annual
meeting. We think the shareholders should support our nominees and proposals as
the best way to promote a prompt auction and sale of the company at the best
available price and terms."
"It is clear that management's statements have clearly fostered rampant
speculation in the market. Therefore, although we had originally been prepared
to await the results of the meeting, we now intend beginning as early as
tomorrow, based on market conditions, to protect our investment by selling some
or all of our Healthdyne shares through market and/or private transactions. We
of course will continue to be the record holder of the full 600,000 shares for
purposes of voting at the annual meeting."
Invacare's wholly owned subsidiary I.H.H. Corp. is making a tender offer
for all outstanding shares of Healthdyne common stock at a price of $15 per
share. The tender offer is currently scheduled to expire at 6:00 p.m., New York
City time, on Friday, August 1, 1997, unless further extended in the manner
described in the Offer to Purchase dated January 27, 1997, as amended and
supplemented by the Supplements thereto dated April 4, 1997 and June 6, 1997.
Invacare has proposed a slate of four nominees at the July 30 annual meeting to
constitute a majority of the board of directors of Healthdyne. The proposals to
be made by Invacare at the annual meeting are proposed amendments to
Healthdyne's by-laws designed to facilitate the change in the board and the
auction and sale of the company; 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
Healthdyne's stock; and demand that the existing board eliminate Healthdyne's
"dead-hand" pill provisions.
# # #
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EXHIBIT 11(g)(23)
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
_____________________________
)
INVACARE CORPORATION and )
I.H.H. CORP., )
)
Plaintiffs, )
)
v. ) CIVIL ACTION NO: 97-CV-0205-CC
)
HEALTHDYNE TECHNOLOGIES, )
INC., ET AL., )
)
)
Defendants. )
_____________________________)
PLAINTIFFS' REPLY BRIEF IN SUPPORT OF EMERGENCY
MOTION FOR CLARIFICATION OF JULY 3, 1997 ORDER, OR,
IN THE ALTERNATIVE, FOR A LIMITED STAY PENDING APPEAL
KING & SPALDING
191 Peachtree Street, N.E.
Suite 4900
Atlanta, Georgia 30303-1763
(404) 572-4600
SIMPSON THACHER & BARTLETT
425 Lexington Avenue
New York, New York 10017
(212) 455-2000
Attorneys for Plaintiffs
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Invacare's motion for clarification does not ask this Court to "order"
Healthdyne to do anything. It merely requests that the Court CLARIFY that its
July 3 Order does not eliminate or alter Healthdyne's existing legal obligations
to count and announce the vote at the upcoming Shareholders Meeting. No more.
Contrary to Healthdyne's assertions, Invacare seeks no "mandatory injunction".
1. GEORGIA LAW REQUIRES HEALTHDYNE TO TABULATE THE VOTES ON THE
BYLAW PROPOSAL AND ANNOUNCE THE RESULT.
Healthdyne's claim that it should not be "ordered" to present an
"illegal" bylaw to the shareholders is, of course, circular and intentionally
miscasts Invacare's limited request for clarification. The Bylaw Proposal is
not illegal. Indeed, Healthdyne has conceded that the Bylaw Proposal vote must
go forward. This Court ruled only that a mandatory bylaw affirmatively
requiring the board to redeem the Dead Hand was invalid. The July 3 Order said
nothing with respect to voting on the Bylaw Proposal and Healthdyne did not put
that issue before the Court. Healthdyne cannot now assert that the Court's
Order changes their legal obligations under Georgia law to tabulate and announce
the vote.
O.C.G.A. Section 14-2-729.1 requires impartial election inspectors to
"count all the votes" and "determine the result."
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The language could not be more plain. Healthdyne has made clear its intention
to prevent the impartial inspectors from carrying out their duty under law.
This threat is outrageous and lawless. However, because Healthdyne has conceded
it will call the Bylaw Proposal for a vote, Invacare presently seeks no ruling
other than a clarification that this Court's July 3 Order does not speak to or
change in any way Healthdyne's legal obligation to count and announce the vote.
Healthdyne's obligations to count and announce are as set forth under law. The
issue has never been put before the Court, and is not before the Court now.
Healthdyne cannot arrogate to itself relief it never sought. And Healthdyne
should not be permitted to misinterpret the plain language of this Court's
July 3 Order to cloak what is otherwise a violation of law.
Healthdyne's opposition to Invacare's motion for clarification is an
attempt at censorship. This Court should take no part of it. While this Court
has ruled invalid a bylaw REQUIRING the Healthdyne directors to redeem the Dead
Hand Provision, there is nothing remotely invalid or illegal in the shareholders
voting on the Bylaw Proposal and being told the results of that vote. Of
course, the shareholder-owners of the corporation have the right to tell the
directors whom the shareholders have elected that they do not want Healthdyne to
implement a Dead Hand Provision. One also would think the
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directors would want to know what the shareholders think. Nevertheless, in
violation of their own existing bylaw permitting shareholders to propose
by-laws, the Healthdyne directors are trying to deny the shareholders even the
right to express their opinion about the Dead Hand. This effort to silence the
shareholder-voters is worthy of a dictatorship, and that is precisely how the
Healthdyne directors run the company.
Moreover, to refuse to tabulate and announce the vote -- an act which
causes Healthdyne no harm whatsoever(1) -- will also damage Invacare's appellate
rights. The shareholders are entitled to know what their fellow shareholders
have voted. The Eleventh Circuit will also be aided by such information. The
Healthdyne "vote now, count later" proposal is simply calculated to achieve
delay. It is yet another effort by the Healthdyne directors to hide from the
expressed will of the shareholder-voters. Delay is harm to the shareholders,
including Invacare.
2. A SHAREHOLDER VOTE ON THE BYLAW PROPOSAL WILL NOT CONFUSE
HEALTHDYNE SHAREHOLDERS.
The shareholders' right to vote on the Bylaw Proposal and learn the
results of that vote is entirely independent from the issue of whether this
Court believes the directors can be REQUIRED to remove the Dead Hand. The
Invacare proposal is plainly intended
____________________
(1) Healthdyne has previously represented that it will present the proposal for
a vote at the meeting.
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to have the maximum legal effect. The public has been informed repeatedly that
if this Court should rule, as it has, that the proposed bylaw is invalid, then a
vote in favor of the Bylaw Proposal will be merely advisory unless there is a
subsequent ruling to the contrary by an appellate court. Healthdyne's
contention that shareholders will be "confused" by this singular choice is a
sham. The shareholders have had several months to consider this issue and it
has been described in publicly-filed materials, including materials mailed
directly to the shareholders. To argue, as Healthdyne does, that the
shareholders will be "confused" by such a choice is typically paternalistic and
demeaning. Moreover, Healthdyne fails to explain how its suggestion, in which
the shareholders will vote on the Bylaw Proposal but Healthdyne simply will not
tabulate the results, eliminates the supposed shareholder confusion. Finally,
Healthdyne's argument is foreign to Georgia's law of corporate governance, which
clearly places ultimate authority in the hands of shareholders to elect the
directors. If shareholders can be entrusted to elect directors they must also
be presumed competent to vote on Invacare's Bylaw Proposal.(2)
__________________
(2) Healthdyne submits an affidavit from one Thomas Ball, a professional proxy
solicitor ostensibly on the issue of shareholder confusion. Mr. Ball's
affidavit lacks factual or professional basis. First, Mr. Ball repeatedly
relies on the mistaken assumption that Invacare has "recently" taken the
position that its
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3. RULE 14A-8 DOES NOT BAR A VOTE ON THE PROPOSED
BYLAW
Finally, Healthdyne's contention that Rule 14a-8 prohibits shareholder
consideration of the "illegal" Bylaw Proposal also lacks merit. (Healthdyne
Brief at 2). Rule 14a-8 has no applicability here. It applies only when a
shareholder asks the company to make proposals. Invacare's Bylaw Proposal is
NOT brought under Rule 14a-8. Outside Rule 14a-8, there are no content
restrictions on proposed bylaws.
Moreover, although the content restrictions in Rule 14a-8 may permit
target company management to refuse to solicit proxies on certain proposals,
those restrictions have no applicability where, as here, the dissident
shareholder assumes the proxy costs for the proposal. UNITED MINE WORKERS OF
AMERICA V. PITTSTON COMPANY, Civil Action No. 89-0962, 1989 U.S. Dist. LEXIS
14030 at
_____________________
proposed bylaw amendment may be legally binding depending on the ruling of the
court. As previously shown, the undisputed record reflects that Invacare's
proposal was framed to have the maximum effect under law and that Invacare
informed the shareholders of the possible consequences of a legal challenge
months ago. Second, Mr. Ball simply declares that "unsophisticated"
shareholders will "likely" be "confused". This is nothing more than a guess.
Mr. Ball does not opine whether confusion will actually result, does not give
the basis for his conclusion (particularly with respect to the fact that
Healthdyne shareholders are unsophisticated), and presents nothing by way of
background that would let a fact finder conclude he was qualified to give an
opinion as to the mental state of shareholders in any event. More importantly,
Invacare submits herewith the Affidavit of Mark H. Harnett. Mr. Harnett has
actually spoken with Healthdyne shareholders and has found no confusion
whatsoever.
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*22-24 (Nov. 24, 1989) (Rule 14a-8 does not apply to proposals which are not
"contained in [the target company's] proxy statement or mailed to shareholders
at [the target company's expense].") Instead, where the dissident party, such
as Invacare, assumes the proxy costs, Rule 14a-7 expressly authorizes a
precatory shareholder vote regardless of the content in the proposal.
AMALGAMATED CLOTHING AND TEXTILE WORKERS UNION V. WAL-MART STORES, INC., 821 F.
Supp. 877, 883 n.5 (S.D.N.Y. 1993) ("Rule 14a-7 imposes no content restriction
... and management has no choice but to mail out the statement of [a]
shareholder willing to underwrite the cost.") Thus, Rule 14a-7 authorizes
Invacare's request for a vote on the Bylaw Proposal.(3)
CONCLUSION
As noted above, all Invacare seeks is a clarification of the July 3
Order to the effect that, with respect to the Bylaw Proposal, this Court only
ruled that a mandatory bylaw requiring the redemption of the Dead Hand
interfered with the discretion of the board. No more and no less. The July 3
Order plainly did not
____________________
(3) Healthdyne also cites to 17 C.F.R. 240.14a-4(e). That provision has no
application to this case because it solely governs the EXERCISE of a proxy
power, not the procedures for votes and tabulation at a shareholders' meeting.
Moreover, Invacare's Bylaw Proposal is brought pursuant to Healthdyne's own
existing Bylaw and state law. Healthdyne's brief does not dispute that Invacare
complied with the bylaw requirements.
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plainly did not authorize Healthdyne to prevent shareholders from expressing
their opinion on this significant issue of corporate governance. Thus, the
Court should grant Invacare's motion for clarification.
DATED: July 22nd, 1997 KING & SPALDING
/s/ M. Robert Thornton
-----------------------------
191 Peachtree Street, N.E. M. Robert Thornton
Atlanta, Georgia 30303 Georgia Bar No. 710475
Telephone: (404) 572-4600 Michael R. Smith
Facsimile: (404) 572-5100 Georgia Bar No. 661689
David J. Onorato
Georgia Bar No. 553826
Of Counsel:
SIMPSON THACHER & BARTLETT Attorneys for Plaintiffs Invacare
425 Lexington Avenue Corporation and I.H.H. Corp.
New York, New York 10017
(212) 455-2000
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Exhibit 11(g)(24)
[INVACARE LETTERHEAD]
July 23, 1997
DEAR FELLOW HEALTHDYNE SHAREHOLDER:
YOU DECIDE IF HEALTHDYNE IS SERIOUS ABOUT A SALE TRANSACTION
-Since January, Healthdyne has insisted that the Company was NOT FOR SALE.
-On June 23, Healthdyne announced that it would "explore alternatives . . .
including a possible merger or acquisition of Healthdyne Technologies with
or by another party and possible transactions employing leverage to deliver
value to shareholders."
-On June 27, in a letter from Healthdyne Chairman Parker Petit to me, Petit
said, "We have already created value for the shareholders . . . by
developing and executing a strategic plan . . . "
-On July 7, a Healthdyne press release stated that "we hope to announce a
value enhancing transaction in the next several weeks"--WITHOUT ANY
EXPLANATION OF WHAT TYPE OF TRANSACTION MIGHT OCCUR.
-NOW, IN ITS LATEST LETTER TO YOU ON JULY 11, HEALTHDYNE SAYS THAT IT HOPES
TO INCREASE SHARE VALUE "EITHER BY PURSUING OUR STRATEGIC PLAN . . . OR
ENGAGING IN A TRANSACTION."
DO HEALTHDYNE'S PRONOUNCEMENTS SOUND LIKE A SINCERE INTENTION TO MAXIMIZE VALUE
NOW BY SELLING TO THE HIGHEST BIDDER?
THERE ARE ONLY A FEW DAYS LEFT TO VOTE -- WHERE IS MANAGEMENT'S DEAL?
You can decide for yourself if the Company is reneging in its "promises" to
shareholders. In our view, Healthdyne pursuing its "strategic plan" means
NOTHING will change. NOT ONCE HAS HEALTHDYNE COMMITTED TO SELLING THE COMPANY.
EVEN IF THEY WERE SERIOUS, WHAT INCENTIVE WILL THEY HAVE TO PURSUE ANY
TRANSACTION IF THEY GET RE-ELECTED FOR ANOTHER YEAR?
Furthermore, as a significant Healthdyne shareholder, we are concerned that
their "engaging in a transaction" (including those which would "employ
leverage") may not result in a sale of the Company, but instead means a
recapitalization or share buyback.
OF COURSE, THIS WOULD MEAN THAT NOTHING WILL CHANGE EXCEPT FOR AN INCREASE
IN THE COMPANY'S DEBT LOAD, SOME FINANCIAL ENGINEERING, AND A MANAGEMENT
ENTRENCHED EVEN FURTHER.
WHO WILL KEEP THE PRESSURE ON THE BOARD IN THE FUTURE?
We have done everything we can to try to bring a substantial premium to
Healthdyne shareholders. We have proposed a slate of nominees committed to
promptly auctioning the Company to the best bidder--BE IT TO INVACARE OR ANY
OTHER WILLING AND BONA FIDE BUYER--using our offer as a floor.
OF COURSE, SHAREHOLDERS WILL HAVE THE ULTIMATE POWER TO ACCEPT OR REJECT ANY
ACTUAL SALE NEGOTIATED BY THE NEW BOARD.
<PAGE>
Remember--if you do not elect our nominees at the annual meeting, we intend
to act to protect our investment by selling some or all of our shares (which
represent almost 5% of Healthdyne's shares) depending on market and other
conditions.
CONSIDER WHAT COULD HAPPEN TO THE PRICE OF YOUR SHARES IF HEALTHDYNE'S BOARD
IS RE-ELECTED AND WE ARE NO LONGER AROUND TO KEEP PRESSURE ON THEM TO SELL THE
COMPANY.
VOTE FOR OUR PROPOSALS TO SUPPORT SHAREHOLDER DEMOCRACY
We encourage you to vote FOR all four of the shareholder proposals, which
support the rights of shareholders to have the final say over several important
corporate governance issues.
-
In particular, the Special Meeting Proposal (Proposal 5 on the GOLD proxy
card) gives Healthdyne shareholders an effective means of calling a special
meeting to consider replacing the Board by reducing the supermajority vote
currently required to call a special meeting. In addition, the proposal
would prevent undue delay of the meeting and guarantee a reasonable time
period for shareholders to consider all the issues.
-
Also, the Dead-Hand Elimination Proposal (Proposal 3 on the GOLD proxy
card) is the strongest possible action shareholders could take to reject
the dead hand provision of the Company's poison pill.(1)
-
Even if you do not choose to support the Invacare nominees, you should
still vote FOR all four shareholder proposals on management's blue proxy
card or on our GOLD card.
PROTECT YOUR RIGHTS AS SHAREHOLDERS
It should be clear by now, however, that the Healthdyne Board should not be
trusted to sell the Company. We urge you to vote for the only nominees committed
to delivering to you the best price and terms for your shares now. IF YOU HAVE
QUESTIONS OR NEED ASSISTANCE IN VOTING YOUR SHARES, PLEASE CALL MACKENZIE
PARTNERS, INC. TOLL FREE AT (800) 322-2885.
VOTE YOUR GOLD PROXY CARD TODAY!
We appreciate your consideration of our nominees and shareholder proposals.
Sincerely,
A. MALACHI MIXON, III
CHAIRMAN OF THE BOARD &
CHIEF EXECUTIVE OFFICER
- ---------------------
(1) Although the Dead-Hand Elimination Proposal is intended to be legally
binding on the Board, it will not be so unless Invacare's appeal of the
district court's position is successful. Invacare is confident that it will
succeed on appeal. In any case, the proposal will at the very least send a
powerful message that shareholders strongly object to the Company's dead
hand provisions.
