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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 22
TO
SCHEDULE 14D-9
SOLICITATION/RECOMMENDATION STATEMENT
PURSUANT TO SECTION 14(D)(4)
OF
THE SECURITIES EXCHANGE ACT OF 1934
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HEALTHDYNE TECHNOLOGIES, INC.
(Name of Subject Company)
HEALTHDYNE TECHNOLOGIES, INC.
(Name of Person Filing Statement)
COMMON STOCK, PAR VALUE $0.01 PER SHARE
(INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
(Title of Class of Securities)
422206102
(CUSIP Number of Class of Securities)
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LESLIE R. JONES, ESQ.
VICE PRESIDENT, SECRETARY AND GENERAL COUNSEL
HEALTHDYNE TECHNOLOGIES, INC.
1255 KENNESTONE CIRCLE
MARIETTA, GEORGIA 30066
(770) 499-1212
(Name, address and telephone number of person
authorized to receive notice and communications
on behalf of the person filing the statement)
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COPY TO:
BLAINE V. FOGG, ESQ.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
919 THIRD AVENUE
NEW YORK, NEW YORK 10022
(212) 735-3000
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This Amendment No. 22 amends and supplements the Schedule 14D-9 filed with
the Securities and Exchange Commission on January 31, 1997 (as amended, the
"Schedule 14D-9") by Healthdyne Technologies, Inc., a Georgia corporation
("Healthdyne"), relating to the proposed tender offer by I.H.H. Corporation, a
Delaware corporation ("IHH") and a wholly owned subsidiary of Invacare
Corporation, an Ohio corporation ("Invacare"), to purchase for cash all
outstanding shares of Common Stock, par value $.01 per share, of Healthdyne.
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ITEM 7. CERTAIN NEGOTIATIONS AND TRANSACTIONS BY THE SUBJECT COMPANY
The information set forth under Item 8 below is incorporated herein by
reference.
ITEM 8. ADDITIONAL INFORMATION TO BE FURNISHED
Item 8 of the Schedule 14D-9 is hereby amended and supplemented by
adding the following information:
On July 23, 1997, Healthdyne issued a press release announcing
developments in its discussions with third parties and other actions taken by
the Board of Directors at a meeting held on July 22, 1997. The press release
stated that Healthdyne has been advised by the executive management of a
Fortune 500 company that it has a strong strategic interest in acquiring
Healthdyne and is prepared to pay a price higher than the $15 per Share offered
by Invacare. A copy of the press release is attached
hereto as Exhibit 69.
As announced in the press release, the Board of Directors of Healthdyne
has determined that if the Board's nominees are re-elected at the July 30
annual meeting, the Board will amend Healthdyne's by-laws effective October 31,
1997 to permit the holders of at least 25% of Healthdyne's Shares to call a
special shareholders meeting. The by-law, which would be effective only if
Healthdyne's shareholders do not approve Invacare's proposed by-law amendment
permitting 10% of the shareholders to call a special meeting, would also repeal
Healthdyne's existing by-law procedures relating to special meetings. If
re-elected at the July 30 annual meeting, the Board also will amend
Healthdyne's Shareholder Rights Plan effective October 31, 1997 to permit a
bidder, if it satisfies certain conditions, to call a special meeting of
shareholders to vote on a binding resolution to redeem the Rights. A bidder
will be permitted to call a special meeting if it: (1) makes an all-cash offer
for all of Healthdyne's Shares at a price more than 15% above the market price;
(2) holds no more than 5% of Healthdyne's Shares and has not held more than 5%
during the prior 12 months; (3) has firm financing or financing commitments
for its offer; and (4) agrees to bear the costs associated with the special
meeting.
The Board of Directors also authorized a $1.0 million trust for the
benefit of the continuing directors if Invacare's four nominees are elected to
Healthdyne's seven member Board at the annual meeting. The purpose of the
trust is, among other things, to pay the costs and expenses (including
financial advisory, legal and other expenses) incurred by the continuing
directors in connection with Invacare's appeal from the July 3 Federal District
Court Order upholding the continuing director provision of Healthdyne's
Shareholder Rights Plan and the evaluation of acquisition and merger proposals
by Invacare or other third parties. The trust will terminate within two years
and any unexpended funds will be returned to Healthdyne.
On July 23, 1997, Healthdyne sent a letter to its shareholders, a copy
of which is attached hereto as Exhibit 70.
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ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.
EXHIBIT
NUMBER DESCRIPTION
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EXHIBIT 69 -- Press release issued by Healthdyne on July 23, 1997.
EXHIBIT 70 -- Letter to Healthdyne shareholders dated July 23, 1997 from
Parker H. Petit and Craig B. Reynolds.
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SIGNATURE
After reasonable inquiry and to the best of its knowledge and belief, the
undersigned certifies that the information set forth in this statement is true,
complete and correct.
HEALTHDYNE TECHNOLOGIES, INC.
By: /s/ Leslie R. Jones
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Name: Leslie R. Jones
Title: Vice President, General
Counsel and Secretary
Dated: July 23, 1997
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EXHIBIT 69
HEALTHDYNE TECHNOLOGIES ANNOUNCES DEVELOPMENTS IN THIRD PARTY
DISCUSSIONS; OTHER ACTIONS
Marietta, Georgia, July 23, 1997 - Healthdyne Technologies,
Inc. (NASDAQ: HDTC) said it was recently advised by the executive management of
a Fortune 500 company that it has a strong strategic interest in acquiring the
Company and is prepared to pay a price higher than the $15 per share offered by
Invacare Corporation. The Company also has received indications of interest
from other strategic buyers and a financial buyer. "We intend to continue
discussions with these parties," said Parker H. Petit, Chairman of the Board.
"We will accept the best proposal as long as it reflects the true value of the
Company. We believe we can achieve higher value for shareholders after the
Board is re-elected and we are negotiating with third parties from a position
of strength. We are committed to doing just that."
The Company also said its Board, if re-elected at the July 30
annual meeting, will amend its bylaws effective October 31, 1997 to permit the
holders of at least 25% of the Company's common stock to call special
shareholders meetings, and will amend its Shareholder Rights Plan effective
October 31, 1997 to permit a bidder, if it satisfies certain conditions, to
call a special meeting of stockholders to vote on a binding resolution to
redeem the Rights. A bidder will be permitted to call a special meeting if it:
(1) makes an all-cash offer for all of the Company's shares at a price more
than 15% above the market price; (2) holds no more than 5% of the Company's
stock and has not held more than 5% during the prior 12 months; (3) has firm
financing or financing commitments; and (4) agrees to bear the costs associated
with the special meeting.
"Our willingness to take these actions is further evidence of
the Board's commitment to building shareholder value," Mr. Petit said.
The Board also took action to protect the interests of
shareholders in the event Invacare's four nominees are elected. The Board
authorized a $1.0 million trust to be used by the Company's Continuing
Directors -- the three nominees of the Company who are elected at the annual
meeting and their approved
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successors -- to pay their financial advisory, legal and other expenses
associated with Invacare's appeal from the July 3 federal district court's
decision upholding the Company's Shareholder Rights Plan and any other proposed
action by Invacare or its nominees. The trust will terminate within two years
and any unexpended funds will be returned to the Company.
"As we expected, Invacare has dropped three nominees from its
slate and is trying to keep three existing directors in place as the only
Continuing Directors who can redeem or amend the Shareholder Rights Plan under
the July 3 court decision," said Mr. Petit. "The trust will enable the
Continuing Directors to stand up to Invacare's pressure tactics and make sure
that the interests of all shareholders are protected and that the Invacare
nominees do not violate their fiduciary duties to shareholders."
The Company said it expects the Continuing Directors to be
Mr. Petit, Craig B. Reynolds, President and Chief Executive Officer, and J.
Paul Yokubinas, because the other four Company nominees have indicated they do
not intend to serve on a Board controlled by Invacare's nominees. Each of
Messrs. Petit, Reynolds and Yokubinas has pledged that he will not approve any
sale, merger or similar transaction with Invacare or any other party on terms
which he, after receiving advice from the advisors retained by the Continuing
Directors, does not believe to be in the best interests of the Company's
shareholders.
Healthdyne Technologies designs, manufactures and markets
technologically advanced medical devices for use in the home, as well as other
specialized clinical settings. The Company's products include diagnostic and
therapeutic devices for the evaluation and treatment of sleep disorders,
non-invasive ventilators, oxygen concentrators and medication nebulizers for
the treatment of respiratory disorders, monitors for infants at risk for SIDS,
and products for asthma management.
This press release contains forward-looking statements that
involve risks and uncertainties, including developments in the healthcare
industry, development and introduction of new products on a timely basis,
favorable resolution of intellectual property matters, third-party
reimbursement policies and practices and regulatory requirements affecting the
approval and sale of medical devices, as well as other risks detailed from time
to time in the Company's reports filed with the Securities and Exchange
Commission, including its Reports on Form 10-K, 8-K and 10-Q.
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EXHIBIT 70
[LOGO]
[HEALTHDYNE TECHNOLOGIES LETTERHEAD]
July 23, 1997
Dear Fellow Shareholder:
We apologize for all the mailings you have received, but they are required
by the disruptive proxy fight being waged by Invacare. In a proxy fight ONLY THE
LATEST DATED PROXY CARD COUNTS. So we are asking all shareholders to confirm
their vote by sending in another proxy.
VOTE THE BLUE PROXY CARD
Please vote the BLUE management proxy card now -- the annual meeting is
only days away.
Even if you have voted before, you should SIGN, DATE AND RETURN THE
ENCLOSED BLUE PROXY CARD. Because time is short, you can also fax your proxy to
us by following the instructions at the end of this letter.
ISS RECOMMENDS A VOTE FOR YOUR BOARD
INSTITUTIONAL SHAREHOLDER SERVICES (ISS), a leading independent proxy
advisory firm, has recommended to its clients that they vote FOR your Board's
nominees for directors (Proposal 1). ISS stated that, "Given the premium of the
current trading price of Healthdyne shares to the Invacare offer and the
improving performance of the company, it appears that HEALTHDYNE'S BOARD IS
FUNCTIONING PROPERLY IN ACCORDANCE WITH ITS FIDUCIARY DUTY TO SHAREHOLDERS.
ADDITIONALLY, THE DISRUPTION CAUSED BY THE ELECTION OF A MAJORITY OF DISSIDENT
NOMINEES COULD PROVE DETRIMENTAL TO SHAREHOLDER INTERESTS." (emphasis added)
A VOTE FOR YOUR BOARD (BLUE PROXY)
IS A VOTE FOR OPTIMAL VALUE
Here's what your Board of Directors and management have done and are doing
to enhance the value of your investment:
- Our strategic plan has produced record performance for the first and
second quarters of 1997 and offers substantial revenue and profit
momentum going forward.
- We are continuing discussions with several large companies and financial
institutions. We recently were advised by the executive management of a
Fortune 500 company that it has a strong strategic interest in acquiring
the Company and is prepared to pay a price higher than Invacare's offer.
We have received indications of interest from other strategic buyers and
a financial buyer. We intend to continue discussions with these parties
and seek other alternatives. We believe that optimal value can be
achieved by your Board after it is re-elected and can negotiate from a
position of strength and not under the intense pressure of a disruptive
proxy fight. We are committed to doing just that and to accepting the
best proposal as long as it reflects the true value of your Company.
- Members of your Board have a history of creating shareholder value. On
three previous occasions, Boards of Healthdyne, Inc., your Company's
predecessor, sold subsidiaries to large corporations. Three years ago, we
sold our largest subsidiary to W.R. Grace and their National Medical Care
subsidiary. Previously we sold subsidiaries to Vickers and British Oxygen,
large international corporations. In each case we managed the transaction
in an orderly way without making premature disclosure of an auction. On
that basis, we were able to obtain optimal values with no disruption to
the subsidiaries because of pre-announcements.
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- To demonstrate our commitment to the shareholders' interests, your Board,
if re-elected, will eliminate perceived barriers to hostile takeover
attempts. Effective October 31, 1997, your Board, if re-elected, will
adopt a by-law permitting holders of at least 25% of the Company's common
stock to call a special shareholders meeting,(1) and amend the Shareholder
Rights Plan to permit a bidder holding less than 5% of the Company's stock
to call (and pay for) a special shareholder meeting to redeem the Rights
if it makes an all-cash, fully-financed offer to acquire all of the
Company's shares at a price which is at least 15% greater than the current
market price.
A VOTE FOR INVACARE CREATES
DEADLOCK, CONTROVERSY, DELAY AND EXPENSE
Having lost in court,(2) Invacare now is seeking only four of the seven
seats on your Company's Board. Accordingly, here's what you can expect if
Invacare's four nominees, and three of your Board's nominees, are elected:
- Deadlock: The Board of Directors of your Company will be deadlocked.
Invacare says its four directors will promptly auction the Company to the
highest bidder -- which could be Invacare at $15 per share if, as we
expect, no other bidder chooses to participate in a process controlled by
Invacare's directors. However, Invacare's directors do not have the power
to waive the Shareholder Rights Plan without the approval of at least two
of the three Continuing Directors (your Board's nominees),(3) each of whom
has pledged not to sell the Company to Invacare or any other buyer at a
price they do not believe is fair to you.
- Controversy: Invacare will continue to press its appeal to overturn the
Federal Court decision upholding the power of the Continuing Directors
under the Rights Plan, while the three Continuing Directors will continue
to vigorously contest the appeal. Invacare also may bring other litigation
against your Continuing Directors.
- Delay: How many months after the shareholders meeting will it take to
resolve this deadlock and controversy?
- Expense: How much will this deadlock, controversy and delay cost your
Company in legal fees and other expenses? Because we are concerned that
Invacare's nominees may do the right thing for Invacare but not for
Healthdyne Technologies' shareholders, your Company has authorized a $1.0
million trust for your Continuing Directors to pay expenses incurred to
contest Invacare's appeal and other possible actions and to evaluate
acquisition and merger proposals by Invacare or other third parties. The
trust will terminate within two years and any unexpended funds will be
returned to the Company.
You should ask yourself: DO YOU WANT YOUR COMPANY MANAGED BY A SPLIT BOARD
WHICH IS DEADLOCKED AND ENGAGED IN EXPENSIVE LITIGATION OVER YOUR COMPANY'S
STRATEGY, OR BY YOUR CURRENT BOARD WHICH IS COMMITTED TO ENHANCING SHAREHOLDER
VALUE AND HAS A PROVEN TRACK RECORD OF DOING SO?
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1 The by-law, which would be effective only if shareholders do not approve
Invacare's proposed amendment permitting 10% of the shareholders to call a
special meeting, would also repeal the Company's existing by- law procedures
relating to special meetings.
2 On July 3, the Federal District Court in Atlanta held that Georgia law
validates the continuing directors provisions of your Company's Shareholder
Rights Plan and invalidates Invacare's proposed by-law amendment (Proposal 3)
aimed at circumventing such provisions. On July 10, the appellate court
refused Invacare's request for an expedited appeal.
3 We expect the Continuing Directors to be Parker H. Petit, Chairman of the
Board; Craig B. Reynolds, President and Chief Executive Officer; and J. Paul
Yokubinas.
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A BOARD DOMINATED BY INVACARE'S NOMINEES
COULD DAMAGE YOUR INVESTMENT
The people who work for your Company are responsible for its outstanding
performance and are the keys to its future growth and success. As a high
technology company operating in competitive markets, your Company needs the
creative talents and technical skills of a highly dedicated group of officers
and employees.
A. Malachi Mixon III, the Chairman of Invacare, has repeatedly attacked
your Company's officers and employees. He has impugned the motives of
management. He has also publicly stated that your Company's sales organization
is "weak."
We are extremely concerned that if Invacare's nominees are elected, their
attempts to auction the Company to the highest bidder, and the resulting
deadlock, controversy and delay, could demoralize your Company's employees,
causing some of them to leave the Company and others to lose their dedication.
This could have a serious adverse effect on your investment.
AN INVESTMENT WORTH PROTECTING --
VOTE THE BLUE PROXY CARD TODAY
For all these reasons, we urge you to vote the enclosed BLUE proxy card In
Favor of your Board's nominees and Against Invacare's shareholder proposals.
Thank you for your continued support.
Sincerely yours,
<TABLE>
<S> <C>
/s/ Parker H. Petit /s/ Craig B. Reynolds
Parker H. Petit Craig B. Reynolds
Chairman of the Board President and Chief Executive Officer
</TABLE>
VOTING INSTRUCTIONS
1. Vote each BLUE proxy card received since each account must be voted
separately. Only your latest dated proxy counts. Even if you have sent a gold
proxy card to Invacare, you have every right to change your vote. You may
revoke that proxy by signing, dating and mailing the enclosed BLUE proxy in
the enclosed envelope.
2. Date your proxy card.
3. Sign your proxy card exactly as your name appears on the mailing label.
4. Mail your proxy card today.
FAX INSTRUCTIONS
If you wish to fax your vote to us rather than sending it in the enclosed
envelope:
1. Sign and date your proxy card.
2. Copy both sides of the proxy card.
3. Fax both sides of your copied proxy card to (212) 754-8300.
4. If your shares are held in the name of a broker, you need to send your proxy
card to your broker. Please direct the party responsible for your account to
vote the BLUE proxy card as recommended by Healthdyne Technologies.
If you have any question on how to vote your shares,
please call our proxy solicitor:
MORROW & CO., INC. (800) 662-5200
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[HEALTHDYNE TECHNOLOGIES LOGO]
