SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year ended December 31, 1996
Commission File Number 1-6926
C. R. BARD, INC.
(Exact name of registrant as specified in its charter)
New Jersey 22-1454160
(State of incorporation) (I.R.S. Employer Identification No.)
730 Central Avenue, Murray Hill, New Jersey 07974
(Address of principal executive offices)
Registrant's telephone number, including area code: (908) 277-8000
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange on
Title of each class which registered
Common Stock - $.25 par value New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days. Yes X No
Indicate by check mark if disclosure of delinquent filers pursuant
to Item 405 of Regulation S-K is not contained herein, and will not
be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part
III of this Form 10-K or any amendments to this Form 10-K. [ X ]
The aggregate market value of the voting stock held by
nonaffiliates of the registrant was approximately $1,560,700,000
based on the closing price of stock traded on the New York Stock
Exchange on February 28, 1997. As of February 28, 1997, there were
57,011,717 shares of Common Stock, $.25 par value per share,
outstanding.
The company's definitive Proxy Statement dated March 7, 1997 has
been incorporated by reference with respect to certain information
contained therein in Part III and Part IV of this Form 10-K.
The exhibit index is located in Part IV, Item 14, Page IV-1.
<PAGE>
PART I
Item 1. Business
General Development of Business
The company was started by Charles Russell Bard in 1907. One of
its first medical products was the silk urethral catheter imported
from France. In 1923, the company was incorporated as C. R. Bard,
Inc. and distributed an assortment of urological and surgical
products. Bard became a publicly-traded company in 1963 and five
years later was traded on the New York Stock Exchange.
In 1966, Bard acquired its supplier of urological and
cardiovascular specialty products - the United States
Catheter & Instrument Co. In 1980 Bard acquired its major source
of the Foley catheter - Davol Inc. Numerous other acquisitions
were made over the last thirty-five years broadening Bard's product
lines. Today, C. R. Bard, Inc. is a leading multinational
developer, manufacturer and marketer of health care products.
1996 sales of $1.194 billion increased 5% from 1995. 1995 sales of
$1.138 billion increased 7% from 1994. Net income for 1996 totaled
$92.5 million or $1.62 per share, and increased 7% and 6%
respectively against 1995. Net income for 1995 totaled $86.8
million or $1.53 per share, an increase of 15% and 14% respectively
against 1994.
Acquisitions
In September of 1996 Bard completed the acquisition of IMPRA, Inc.
("IMPRA"), a company that develops, manufactures and markets
vascular grafts used for blood vessel replacement surgery. The
purchase and acquisition costs which approximated $155.4 million
were financed with commercial paper. In addition, during 1996, the
company acquired St. Jude Medical's Cardiac Assist Division
and X-Trode S.r.l. These acquisitions enhance and expand the
company's existing product lines and further develop international
markets. The cost of these acquisitions amounted to approximately
$44.0 million and were financed through internally generated cash
and available credit lines.
In September 1995, the company completed a merger with MedChem
Products, Inc. ("MedChem") issuing 3,192,345 shares of its common
stock in exchange for all outstanding common stock of MedChem. In
October 1995, the company completed a merger with American Hydro-Surgical
Instruments, Inc. ("AHS") issuing 1,338,446 shares of its
common stock in exchange for all outstanding common stock of AHS.
These mergers have been accounted for as poolings of interests, and
accordingly, the company's information contained in this Annual
Report on Form 10-K were restated in 1995.
I-1
<PAGE>
Acquisitions (continued)
During 1994 the company spent $118.2 million acquiring new
businesses. Angiomed AG, a German company with products marketed
in the areas of urology, radiology, vascular surgery and
gastroenterology was purchased in October 1994. VasCath, Inc., a
Canadian company with a strong position in specialty catheter
products was acquired in December 1994.
Product Group Information
Bard is engaged in the design, manufacture, packaging, distribution
and sale of medical, surgical, diagnostic and patient care devices.
Hospitals, physicians and nursing homes purchase approximately 90%
of the company's products, most of which are used once and
discarded.
The following table sets forth for the last three years ended
December 31, 1996, the approximate percentage contribution by
product line to Bard's consolidated net sales. The figures are on
a worldwide basis.
Years Ended December 31,
1996 1995 1994
Cardiovascular 33% 33% 35%
Urological 29% 28% 27%
Surgical 38% 39% 38%
Total 100% 100% 100%
Narrative Description of Business
General
Historically, Bard has been known for its products in the
urological field, where its Foley catheter is the leading device
for bladder drainage. Today, Bard's largest product group is in
surgical devices, contributing approximately 38% of consolidated
net sales.
Bard continually expands its research toward the improvement of
existing products and the development of new ones. It has
pioneered in the development of disposable medical products for
standardized procedures.
I-2
<PAGE>
General (continued)
Bard's domestic sales may be grouped into three principal product
lines: cardiovascular, urological and surgical. International
sales include most of the same products manufactured and sold by
Bard's domestic operations. Domestic and international sales are
combined for product group sales presentation.
Cardiovascular - Bard's line of cardiovascular products includes
balloon angioplasty catheters, steerable guidewires, guide
catheters and inflation devices; angiography catheters and
accessories; introducer sheaths; electrophysiology products
including cardiac mapping and electrophysiology laboratory systems,
and diagnostic and temporary pacing electrode catheters;
cardiopulmonary support systems; and blood oxygenators and related
products used in open-heart surgery. See the first paragraph of
Item 3. Legal Proceedings on Page I-6 for additional information.
Urological - Bard offers a complete line of urological products
including Foley catheters, procedural kits and trays and related
urine monitoring and collection systems; biopsy and other cancer
detection products; ureteral stents; and specialty devices for
incontinence, endoscopic procedures and stone removal.
Surgical - Bard's surgical products include specialty access
catheters and ports; implantable blood vessel replacements; fabrics
and meshes for vessel and hernia repair; surgical suction,
irrigation and drainage devices; gastroenterological products,
irrigation devices for orthopaedic and laparoscopic procedures;
laparoscopic accessories; blood management devices and products for
wound management and skin care.
International - Bard markets cardiovascular, urological and
surgical products throughout the world. Principal markets are
Japan, Canada, the United Kingdom and continental Europe.
Approximately two-thirds of the sales in this segment are of
products manufactured by Bard in its facilities in Canada, France,
Germany, Ireland, Malaysia and the United Kingdom. The balance of
the sales are from products manufactured in the continental United
States, Puerto Rico or Mexico for export. Bard's foreign
operations are subject to the usual risks of doing business abroad,
including restrictions on currency transfer, exchange fluctuations
and possible adverse government regulations. See p. II-28 Note 10
in the Notes to Consolidated Financial Statements for additional
information.
I-3
<PAGE>
Competition
The company knows of no published statistics permitting a general
industry classification which would be meaningful as applied to the
company's variety of products. However, products sold by the
company are in substantial competition with those of many other
firms, including a number of larger well-established companies.
The company depends more on its consistently reliable product
quality, dependable service and its ability to develop products to
meet market needs than on patent protection, although some of its
products are patented or are the subject of patent applications.
Marketing
The company's products are distributed domestically directly to
hospitals and other institutions as well as through numerous
hospital/surgical supply and other medical specialty distributors
with whom the company has distributor agreements. In international
markets, products are distributed either directly or through
distributors with the practice varying by country. Sales promotion
is carried on by full-time representatives of the company in
domestic and international markets.
Sales to a distributor, which supplies the company's products to
many end-users, accounted for approximately 8% of the company's
sales and the five largest distributors combined accounted for
approximately 21% of such sales. Combined sales to federal
agencies accounted for approximately 2% of sales in 1996
(See Item 3. Legal Proceedings).
In order to service its customers, both in the U.S. and outside the
U.S., the company maintains inventories at distribution facilities
in most of its principal marketing areas. Orders are normally
shipped within a matter of days after receipt of customer orders,
except for items temporarily out of stock, and backlog is normally
not significant in the business of the company.
Most of the products sold by the company, whether manufactured by
it or by others, are sold under the BARD trade name or trademark
or other trademarks owned by the company. Such products
manufactured for the company by outside suppliers are produced
according to the company's specifications.
I-4
<PAGE>
Regulation
The development, manufacture, sale and distribution of the
company's products are subject to comprehensive government
regulation. Government regulation by various federal, state and
local agencies, which includes detailed inspection of and controls
over research and laboratory procedures, clinical investigations,
manufacturing, marketing, sampling, distribution, record keeping,
storage and disposal practices, substantially increases the time,
difficulty, and costs incurred in obtaining and maintaining the
approval to market newly developed and existing products.
Government regulatory actions can result in the seizure or recall
of products, suspension or revocation of the authority necessary
for their production and sale, and other civil or criminal
sanctions.
Raw Materials
The company uses a wide variety of readily available plastics,
textiles, alloys and rubbers for conversion into its devices. Two
large, U.S.-based chemical suppliers have sought to restrict the
sale of certain of their materials to the device industry for use
in implantable products. Although one guiding principle in the
adoption of this policy is the avoidance of negative economic
effect on the health care industry, a small portion of our product
lines may face a short-term threat to the continuity of their raw
material supply. Such suppliers have indicated that their action
is based on product liability concerns. Bard and the medical
device industry are working to resolve this problem in general and
with these suppliers to assure a continuing supply of necessary raw
materials. Bard is working to maintain a supply of qualified
materials by developing new supplies and increasing inventories of
important stocks.
Environment
The company continues to address current and pending environmental
regulations relating to its use of Ethylene Oxide for the sterilization
of some of its products. The company is complying with requlations
reducing permitted ETO emissions by installing scrubbing equipment
and adjusting its processes.
The company recognizes the Montreal Protocol Treaty, which plans for
the reduction of CFC use worldwide. The company has eliminated the
use of CFC's in its sterilization processes. The company intends to
continue to reduce its other uses of CFC's. Capital expenditures
required will not significantly adversely affect the company's earnings
or competitive position.
I-5
<PAGE>
Employees
The company employs approximately 9,800 persons.
Seasonality
The Company's business is not affected to any material extent by
seasonal factors.
Research and Development
The Company's research and development expenditures amounted to
approximately $77,300,000 in 1996, $75,600,000 in 1995 and
$71,600,000 in 1994.
Item 2. Properties
The executive offices of the company are located in Murray Hill,
New Jersey in facilities which the company owns. Domestic
manufacturing and development units are located in Arizona,
California, Georgia, Kansas, Massachusetts, Michigan, New Jersey,
New York, Ohio, Puerto Rico, Rhode Island, South Carolina, Texas,
Utah and Washington. Sales offices and distribution points are in
these locations as well as others.
Outside the U.S., the company has plants or offices in Australia,
Austria, Belgium, Canada, China, France, Germany, Hong Kong, India,
Ireland, Italy, Japan, Korea, Malaysia, Mexico, the Netherlands,
Portugal, Singapore, Spain, Sweden, Switzerland and the United
Kingdom.
The company owns approximately 2,528,000 square feet in 23
locations and leases approximately 1,233,000 square feet of space
in 68 locations.
All these facilities are well maintained and suitable for the
operations conducted in them.
Item 3. Legal Proceedings
On October 14, 1993, the company entered into a Plea Agreement with
the Department of Justice in connection with charges stemming from
violations, primarily during the 1980s by the Company's USCI
division, of the Federal Food, Drug and Cosmetic Act and other
statutes. In connection with such violations, the Defense
Logistics Agency debarred the USCI division from entering into new
contracts with the U.S. Government. Such debarment expired
on June 19, 1996.
I-6
<PAGE>
Item 3. Legal Proceedings (continued)
In November 21, 1994 an action was commenced against the company by
Surgical Laser Technologies, Inc. (SLT) in the United States
District Court for the Eastern District of Pennsylvania. The
Amended Complaint alleged that the company has repudiated, refused
to perform and breached an alleged contract with SLT, and further
alleges a breach of the duty of good faith and fair dealing in the
conduct of contract negotiations between the parties and unfair
competition. Damages of an unspecified amount are sought together
with injunctive relief. The company has answered the Amended
Complaint, denying that there was ever agreement to the alleged
contract, or that the company otherwise breached any duty owed to
SLT. Discovery has recently commenced and no trial date has yet
been set. The company believes it has meritorious defenses to this
action.
On October 6, 1995, Trimedyne, Inc. filed a complaint in State
Court in California alleging breach of contract, fraud and
negligent misrepresentation by the company in connection with its
performance under a Development, Supply and License Agreement dated
June 28, 1991, concerning side-firing laser products (Urolase ).
In addition, the complaint alleges that the company has failed to
pay for product purchased, along with certain other charges.
Trimedyne, Inc. seeks damages totalling $72 million plus punitive
damages. The case has been removed to the Federal District Court
and transferred to the District of New Jersey. The company
believes it has some liability to the plaintiff for certain goods
ordered; however, the amount is in dispute. Except as to this
claim, the company believes that it has meritorious defenses to
this action.
During 1993, the United States Environmental Protection Agency (the
"EPA") notified the Company's Urological division that it may be a
potentially responsible party relative to clean-up of the Frontier
Chemical site in Niagara Falls, New York. In September, 1993, the
company entered into a consent order concerning the first phase of
the clean-up, which was a drum removal action. The Company's
liability for the first phase was $119,000. A second phase of
remedial action involves removal of waste in several large tanks.
The Company's liability for this phase was assessed at less than
$14,000. The third phase of remedial action involves soil and
groundwater contamination which may be significant in view of the
age of this industrial site. The Company's responsibility for
clean up of this phase is unknown at this time, but it is believed
that the final resolution of this matter is not expected to have a
material adverse financial impact on the company.
I-7
<PAGE>
Item 3. Legal Proceedings (continued)
During 1992, the EPA notified the company that it had been
identified as a potentially responsible party in connection with an
ongoing investigation of the Solvents Recovery Service of New
England site in Southington, Connecticut. Although the full extent
of liability in this case is unknown, the company has been
identified with less than one-half percent of the total gallonage
of waste materials. In June of 1995, the company accepted the
EPA's invitation to enter into negotiations concerning the Group's
undertaking the remedial investigation and feasibility study.
Negotiations concerning a Consent Order to allow the Group to
undertake the remedial investigation and feasibility study are
ongoing. The final resolution of this matter is not expected to
have a material adverse financial impact on the company.
The company is also subject to other legal proceedings and claims
which arise in the ordinary course of business.
Item 4. Results of Votes of Security Holders
Not applicable.
I-8
<PAGE>
Executive Officers of the Registrant
Set forth below is the name, age, position, five year business
history and other information with respect to each executive
officer of the company as of March 1, 1997. No family
relationships exist among the officers of the company.
Name Age Position
William H. Longfield 58 Chairman and
Chief Executive Officer
and Director
Benson F. Smith 49 President and
Chief Operating Officer
and Director
William C. Bopp 53 Executive Vice President and
Chief Financial Officer
and Director
Guy J. Jordan 49 Group Vice President
Timothy M. Ring 39 Group Vice President
William T. Tumber 62 Senior Vice President
John H. Weiland 41 Group Vice President
E. Robert Ernest 56 Vice President - Planning
and Development
Richard A. Flink 62 Vice President, General Counsel
and Secretary
Christopher D. Ganser 44 Vice President - Quality
Assurance
Hope Greenfield 46 Vice President - Human
Resources
Charles P. Grom 49 Vice President and Controller
Richard D. Manthei 61 Vice President-Scientific
Affairs
Earle L. Parker 53 Vice President and
Treasurer
All officers of the company are elected annually by the Board of
Directors.
I-9
<PAGE>
Mr. Longfield joined the company in 1989 and was elected executive
vice president and chief operating officer. In 1991 he was elected
president. In June 1994 he was elected president and chief
executive officer. In September 1995 he was elected to his present
position. Prior to joining the company, he was chief executive
officer since 1984 of the Cambridge Group, Inc., a provider of long
term health services for the elderly. Prior to joining Cambridge,
he was employed by Lifemark, Inc., a health care management
company, and for over 20 years with American Hospital Supply
Corporation.
Mr. Smith joined Bard in 1980. In 1990, he was appointed to the
position of group executive. In 1991, he was elected group vice
president. In 1993, he was elected to the position of executive
vice president with worldwide responsibility for operations. In
1994 he was elected to the additional post of chief operating
officer. In October 1995 he was elected to his present position.
Mr. Bopp joined the company in 1980. In 1983 he was elected to the
position of treasurer. He was named vice president and treasurer
in 1989. In 1992 he was elected senior vice president and chief
financial officer. In October 1995 he was elected to his present
position.
Mr. Jordan joined the company in 1986 as director of research and
development for USCI. In 1990 he was promoted to vice president
for specialty access products for Davol. In 1991 he was promoted
to vice president and general manager of Bard Access Systems and
became president of the division in 1993. In 1996 he was elected
to his present position.
Mr. Ring joined the company in 1992 and was elected vice president-
human resources. Prior to joining the company he had been with
Abbott Laboratories Inc., a pharmaceutical company, since 1982 and
his last position with their Hospital Products division had been
director of personnel. In December 1993, he was elected to the
position of group vice president.
Mr. Tumber joined Bard in 1980. In 1988 he was promoted to vice
president and general manager of Davol Inc. In 1990 he was
promoted to president of Davol Inc. and subsequently appointed to
the position of group executive. In September 1991, he was elected
to group vice president and in 1996 appointed to his present
position of senior vice president.
I-10
<PAGE>
Mr. Weiland joined the company in February 1996 as group vice
president. Prior to joining the company, since 1991 he was senior
vice president, North American Group, with Dentsply International,
the nation's largest manufacturer of professional dental products.
Prior to that he was president and chief executive officer of
Pharmacia Diagnostics, Inc., a manufacturer of medical diagnostic
supplies and in various positions with Baxter International, Inc.,
a manufacturer of health care products and services.
Mr. Ernest joined the company in 1977 and was elected to his
present position in 1979.
Mr. Flink joined the company in 1970, was elected vice president
and general counsel in 1973 and was elected to his present position
in 1985.
Mr. Ganser joined the company in 1989 as Manager, Quality Assurance
in the Moncks Corner facility. In April, 1994 he was elected to
his present position.
Ms. Greenfield joined the company in October 1995 as corporate vice
president, human resources. Prior to joining the company she had
been with Digital Equipment Corporation, a supplier of information
systems and hardware, as vice president development and learning
and in various human resource positions.
Mr. Grom joined the company in 1977. In 1989 he was promoted to
assistant corporate controller and in 1994 was elected corporate
controller. In April 1995 he was elected to his present position.
Mr. Manthei joined the company is 1996. Prior to joining the
company, he was a partner in the law firm of McKenna and Cuneo in
Washington, DC, where he chaired the Food, Drug, Cosmetic and
Medical Device Department.
Mr. Parker joined the company in 1979. In December 1990 he was
promoted to vice president-operations for the USCI division and,
later that year, was promoted to vice president and general manager
of the USCI Angiography division. In 1992 he was elected Treasurer
and effective January 1, 1995 he was elected to his present
position.
I-11
<PAGE>
PART II
Item 5. Market for Registrant's Common Stock and Related
Stockholder Matters
Market and Market Prices of Common Stock
The Company's common stock is traded on the New York Stock Exchange
using the symbol: BCR. The following table illustrates the high
and low sales prices as traded on the New York Stock Exchange for
each quarter during the last two years.
Quarters
1st 2nd 3rd 4th Year
1996
High 37-3/8 37 34-3/8 32-3/4 37-3/8
Low 29-1/2 31-7/8 28-3/4 25-7/8 25-7/8
Close 35-5/8 34-1/8 31-1/8 28 28
1995
High 28-1/8 31-1/8 31-7/8 32-1/4 32-1/4
Low 25-1/2 27-1/4 29-1/4 27-7/8 25-1/2
Close 27-5/8 30 30-1/2 32-1/4 32-1/4
Approximate Number of Equity Security Holders
Approximate Number
of Record Holders
Title of Class as of February 28, 1997
Common Stock - $.25 par value 7,184*
*Included in the number of shareholders of record are shares held
in "nominee" name.
Dividends
The company paid cash dividends of $37,700,000 or $.66 per share in
1996 and $33,100,000 or $.62 per share in 1995. The following
table illustrates the quarterly rate of dividends paid per share.
Quarters
1st 2nd 3rd 4th Year
1996 $ .16 $ .16 $ .17 $ .17 $ .66
1995 $ .15 $ .15 $ .16 $ .16 $ .62
In January 1997, the first quarter dividend of $.17 per share was
declared, indicating an annual rate of $.68 per share. The first
quarter dividend was paid on January 31, 1997 to shareholders of
record on January 20.
II-1
<PAGE>
<TABLE>
Item 6. Selected Financial Data
(Thousands of dollars except per share amounts)
<CAPTION>
For the Years Ended December 31,
1996 1995 1994 1993 1992
<S> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA
Net sales $1,194,400 $1,137,800 $1,064,600 $1,008,800 $1,033,800
Net income 92,500 86,800 75,600 57,800 83,400
BALANCE SHEET DATA
Total assets $1,332,500 $1,091,000 $1,043,100 $ 881,400 $ 789,200
Working capital 240,700 230,600 72,300 165,200 213,200
Long-term debt 342,800 198,400 93,400 82,100 84,000
Total debt 491,000 265,300 294,000 171,000 148,300
Shareholders'
investment 601,500 564,600 495,400 439,900 444,900
COMMON STOCK DATA
Net income per
share $ 1.62 $ 1.53 $ 1.34 $ 1.02 $ 1.45
Cash dividends
per share .66 .62 .58 .54 .50
Shareholders'
investment per
share $ 10.56 $ 9.89 $ 8.77 $ 7.77 $ 7.75
Average shares
outstanding
(000's) 57,090 56,731 56,461 56,692 57,422
SUPPLEMENTARY DATA
Return on average
shareholders'
investment 15.9% 16.4% 16.2% 13.1% 19.2%
Net income/net
sales 7.7% 7.6% 7.1% 5.7% 8.1%
Days-accts rec 70.3 66.7 62.3 60.7 63.1
Days-inventory 151.7 149.4 143.6 135.9 129.4
Total debt/total
capitalization 44.9% 32.0% 37.2% 28.0% 25.0%
Interest expense $ 26,400 $ 24,200 $ 16,300 $ 12,500 $ 13,400
R&D expense $ 77,300 $ 75,600 $ 71,600 $ 67,500 $ 62,300
# of employees 9,800 9,400 8,900 8,650 9,000
Net sales per
employee $ 121.9 $ 121.0 $ 119.6 $ 116.6 $ 114.9
Net income per
employee $ 9.4 $ 9.2 $ 8.5 $ 6.7 $ 9.3
<FN>
</TABLE>
II-2
<PAGE>
Item 7. Management's Discussion and Analysis of Results
of Operations and of Financial Conditions
General
Bard is a leading multinational developer, manufacturer and
marketer of products for the large and growing health care
industry. Worldwide health care expenditures approximated $2.3
trillion in 1996 with about half that amount spent in the United
States. Bard's segment of this industry, itself a multi-billion
dollar market, is primarily specialized products used mainly in
hospitals, in outpatient centers and in physician's offices to meet
the needs of the medical profession in caring for their patients.
We seek to focus and concentrate on selected markets with cost-effective,
innovative products and specialized sales forces to
maximize our opportunities in these markets.
Summary Results
Consolidated net sales increased 5% in 1996 with the growth well
balanced among product groups and geographic areas. Net income
increased 7% and earnings per share rose 6%, with 1996 and 1995
income both affected by one-time charges, which are described
below.
One-time Items Affecting Results
Net income was affected in 1996 by one-time charges of $29.8
million, partially offset by a total of $18.6 million for the
reversal of tax reserves no longer required and certain other
items. These charges and income items are described on
page II-6 of this financial review and resulted in a net after-tax
reduction in income of $11.2 million. Net income in 1995 was
reduced by $13.5 million reflecting the costs of combining the
operations of MedChem and AHS into Bard. Net income in 1994 was
reduced by $16.9 million for certain legal fees and settlements.
Results of Operations - 1996 vs. 1995
Net sales totaled $1.194 billion in 1996, a 5% increase over 1995.
Price reductions totaled about 2% worldwide while a stronger dollar
reduced reported sales by 1%.
Sales of cardiovascular products rose 5% in 1996 to $394.2 million.
Radiology devices showed strong growth, primarily in markets
outside the U.S. Sales of cardiac assist devices acquired from St.
Jude Medical in January 1996 also added to the cardiovascular
growth rate.
II-3
<PAGE>
Results of Operations - 1996 vs. 1995 (continued)
Urological product group sales totaled $342.4 million in 1996, a 6%
increase over 1995. Basic drainage products such as Foley
catheters and trays, other procedural trays, urinary bags and
meters and specialty devices all contributed to this growth. Our
growth in urological products was high in the U.S. market and we
continue to try to broaden our international market penetration.
Surgical product group sales increased 4% in 1996 to $457.8 million
with the growth in international markets a little higher than in
the U.S. The additional sales generated from the September 1996
IMPRA acquisition contributed significantly to surgical product
growth. Individual areas of good performance continue to be our
vascular access catheters and ports, hernia repair fabrics, and
orthopaedic irrigation devices. This was substantially offset by
declines in basic drainage and general surgery devices.
Sales in the United States grew 4% in 1996 to $782.0 million,
representing 65% of worldwide sales. Urological turned in the
highest growth rate of our three product groups, but surgical
continues to generate the most revenue. Cardiovascular sales
showed only a marginal increase in 1996 as fourth quarter new
product launches did not have enough time to generate increased
sales momentum.
Sales outside the U.S. grew 6% in 1996 to $412.4 million,
representing 35% of worldwide sales, compared with 34% in 1995.
Growth was highest in the cardiovascular product area, primarily
from strong balloon angioplasty product sales in Europe. Balloon
angioplasty products continued to do better outside the U.S. due to
a quicker regulatory approval process in most international
markets. Sales of urological products showed a small increase
outside the U.S. Significant declines in basic surgical suction,
irrigation, drainage and general surgery products offset good
increases in sales of several other surgical group products. The
effect of currency translation was to lower international sales by
almost 3% for the year. Excluding this effect, reported
international sales would have increased 9% over the prior year.
The geographic breakdown of sales outside the U.S. for the last
three years is:
1996 1995 1994
Europe, Middle East,
Africa 62% 62% 56%
Asia/Pacific area and
Western hemisphere,
excluding U.S. 38% 38% 44%
100% 100% 100%
II-4
<PAGE>
Results of Operations - 1996 vs. 1995 (continued)
The cost of goods sold increased to 48.7% of sales in 1996 compared
with 48.3% in the prior year as price declines exceeded our ability
to reduce costs. Bard historically had been able to recover these
costs through its strong product position in its markets or by
offsetting the effect of inflation through its cost reduction
programs. Recently, market price reductions have exceeded our
gains in manufacturing efficiencies and our efforts to shift our
mix to higher margin products.
Marketing, selling and administrative expenses increased just over
3% in 1996, lower than the rate of growth in sales, as efforts were
increased to lower expenses to help offset some of the effects of
price declines. Also, we have realized synergies from the two
mergers completed late in 1995. As a percent to total sales, these
expenses represented 30.6% in 1996 compared with 31.2% in 1995.
Research and development spending increased over 2% in 1996,
representing 6.5% of sales, slightly less than the ratio to sales
in 1995. In our efforts to reduce costs, we eliminated certain
planned spending while continuing sufficient work on the programs
needed for our future success.
Additional interest expense related to acquisitions in 1996
resulted in an increase in total interest expense for the year.
Costs to combine the operations of acquisitions of $9.0 million in
1996 and $17.7 million in 1995 affected income in both years.
Please refer to Note 9, Other (Income) Expense, Net of the Notes to
Consolidated Financial Statements in this report for a summary of
items in this category in the last three years. Included in this
category in 1996 are charges of $31.0 million for the write down of
assets related to guidewire technology, $10.0 million for the
closing of certain manufacturing operations and a net amount of
$3.5 million for certain legal fees and settlements. Also included
are nonrecurring royalty payments of $9.2 million received in 1996
for prior periods.
Income Tax
The effective income tax rate was 10% in 1996. Excluding the
impact of the first quarter reversal of approximately $15 million
in tax reserves no longer required and the increased tax benefit in
the U.S. related to the one-time charges discussed previously, the
effective tax rate would have been 29.5% compared with 29.7% in
1995.
II-5
<PAGE>
Net Income
Net income increased 7% in 1996 and was affected over the last
three years by costs to combine the operations of acquired
companies in 1995 and 1996 and by other one-time items in 1994 and
1996. The effect on net income and earnings per share in the last
three years were (in millions except per share amounts):
1996
Reorganization, asset writedown and
costs to combine operations $(29.80)
Reversal of tax reserves 15.00
Prior period royalty payments,
legal settlements and other 3.60
Total 1996 $(11.20)
Equivalent per share $ (.20)
1995
Costs to combine operations $(13.50)
Equivalent per share $( .24)
1994
Legal fees and settlements $(16.90)
Equivalent per share $ ( .30)
After adjusting for the items shown above, net income and earnings
per share (EPS) would have been:
Net Income
(millions) EPS
1996 $103.7 $1.82
1995 $100.3 $1.77
1994 $ 92.5 $1.64
Results of Operations - 1995 vs. 1994
Net sales totaled $1.138 billion in 1995, an increase of 12% over
the $1.018 billion originally reported for 1994. This 12% increase
includes 5% from new sales as a result of the two acquisitions Bard
made in 1995. Since they were accounted for as poolings of
interests, Bard's restated sales for 1994 are $1.065 billion,
resulting in a 7% increase to $1.138 billion in 1995. Worldwide
revenue growth of 10% in 1995 in the urological and surgical
product groups combined with a 1% increase in cardiovascular sales,
resulted in the consolidated increase of 7%. All of the growth
came from sales outside the U.S. as U.S. sales approximated the
prior year's level. Price reductions totaled 2% on a worldwide
basis in 1995 while higher foreign currency values versus the
dollar increased total reported sales by 2%.
II-6
<PAGE>
In the urological product group, worldwide sales increased 10% in
1995, all of it from outside the U.S., with a substantial portion
the result of a full year's sales of Angiomed products in 1995
versus two months of sales following the acquisition in 1994.
Urological sales in 1994 increased 16% with a majority of the
increase a result of sales of the Contigen implant.
Surgical product group sales increased 10% in 1995, a majority of
which was outside the U.S. A full year of sales of Angiomed and
Vas-Cath products (acquired in 1994) benefited this area
substantially, as did strong growth in sales of vascular access
catheters and ports, fabrics and mesh products for hernia repair
and gastroenterology devices. Sales in 1994 of surgical products
increased 6% with the areas of vascular access, vascular fabrics
and mesh and gastroenterology showing good gains.
Sales of cardiovascular products increased just 1% in 1995. A full
year of Angiomed product sales benefited this area along with good
increases in interventional radiology and the FemoStop device.
U.S. sales continued to decline as the company awaited clearance
from the Food and Drug Administration (FDA) for new products from
our USCI division. In 1994, continued weakness in certain
cardiovascular product areas resulted in a 3% decline in sales in
this group. Increased sales outside the U.S. were more than offset
by declines in the U.S. which continued to be affected by the lack
of approvals by the FDA of new products from our USCI division.
Sales in the United States declined slightly in 1995 versus 1994
and represented 66% of total sales. Total surgical product sales
in the U.S. showed good growth with significant increases in sales
of vascular access, gastroenterology, hernia repair fabrics and new
MedChem products. Urological product sales in the U.S. were level
with 1994 while sales of cardiovascular products declined. Sales
in the United States increased 4% in 1994 and represented 71% of
total sales. Sales of the Contigen implant were the most important
contributor to this growth.
Sales growth outside the U.S. continued to be strong in 1995 with
a 24% increase over 1994, a significant portion from a full year of
sales of Angiomed and Vas-Cath products. Higher foreign currency
values in 1995 contributed 7% of the increase. Numerous products
in all three product groups showed significant gains in revenue in
1995. Sales outside the U.S. increased 9% in 1994 with a little
more than 1% of that growth the result of higher foreign currency
values. The growth was broad-based throughout our product areas
and major geographic markets. Acquisitions accounted for 3% of
this growth.
II-7
<PAGE>
The cost of goods sold as a percent of sales was 48.3% in 1995 and
48.2% in 1994. Productivity gains, cost reductions and a favorable
product mix all contributed to reduced costs as a percent of sales
for several years through 1994 and these factors almost matched the
level of price reductions in 1995.
Marketing, selling and administrative expenses increased by 8.6% as
we invested in programs to boost future sales revenue. The
synergies from the two mergers closed late in 1995, and from our
divisional reorganization, were not realized by year-end. As a
percent of sales, these expenses were 31.2% in 1995 and 30.7% in
1994.
Research and development spending continued to increase as we
worked on new technologies and applications for the future. The
level of spending as a percent to sales was 6.6% in 1995 and 6.7%
in 1994.
Interest expense increased from $16.3 million in 1994 to $24.2
million in 1995 as average debt levels increased as a result of
acquisitions made in 1994.
Costs to combine the operations of acquisitions made in 1995 were
$17.7 million. No amounts were recorded in this category in 1994.
Other (income) expense, net in 1994 included a $28.2 million one-time charge
for certain legal fees and the settlement of a suit. No nonrecurring items
were recorded in 1995 in this category.
The effective income tax rate was 29.7% in 1995 and 27.4% in 1994.
The tax benefit from operations in Puerto Rico and Ireland
favorably affected the tax rate each year. The lower rate in 1994
was primarily due to the one-time charge that was tax effected at
U.S. rates.
Net income increased 15% in 1995 and 31% in 1994. Each year was
affected by one-time items as described earlier in this financial
review.
Financial Condition and Liquidity
Bard's financial condition remains strong. While total debt
increased by $225.7 million in 1996, primarily for acquisitions,
$150 million in long-term debt was issued in the public market and
$120 million remains classified as long-term with the backing of
our committed credit facility. The ratio of total debt to total
capitalization was at 45% in 1996 compared with 32% in 1995
II-8
<PAGE>
and 37% in 1994. In 1995, Bard's equity base was increased with
the issuance of common stock for the acquisitions of MedChem
Products and American Hydro-Surgical. In 1995 the company
completed the arrangement of a $350 million syndicated, committed
credit facility with a group of 15 banks. With the long-term debt
issue in December 1996, the company reduced the credit agreement to
$300 million with 11 banks, effective January 1, 1997.
The credit agreement supports a commercial paper program which
started in September 1996 with a maximum amount of $350 million,
reduced by the company to $300 million effective January 1, 1997.
The company borrows actively under this program.
In addition to the $300 million committed credit agreement, Bard
maintains uncommitted credit lines with banks for short-term cash
needs and these lines were used as needed during the last three
years. At December 31, 1996 the unused uncommitted lines of credit
totaled $239 million.
As now structured, the company expects cash flows from operating
activities to exceed capital expenditures and dividend payments.
The company believes it could borrow adequate funds at competitive
terms and rates, should it be necessary. This overall financial
strength gives Bard sufficient financing flexibility.
Total cash outlays made for purchases of businesses, patents,
trademarks and other related items were $237 million in 1996, $19
million in 1995 and $148 million in 1994 for a total over the last
three years of $404 million. The majority of these investments
were for intangible assets, reflecting the premium over book value
for these purchases. The cash outlays exclude common stock valued
at $135 million issued in 1995 for the acquisitions of MedChem
Products and American Hydro-Surgical. The majority of the cash
outlays were financed with additional debt ($320 million) with the
balance coming from cash from operations.
Periodically, the company purchases its common stock in the open
market to replace shares issued under various employee stock plans.
Net shares issued under the plans were 699,085 in 1996; 648,943 in
1995; and 318,912 in 1994. Total shares purchased were 813,700 in
1996; 75,000 in 1995; and 350,000 in 1994. In June 1996 the Board
of Directors authorized the purchase from time to time of up to 1
million shares of which 244,800 had been purchased as of
December 31, 1996.
II-9
<PAGE>
Foreign Currency Risk
The company periodically enters into foreign exchange contracts to
reduce its exposure to fluctuations in currency values. Contracts
have been exclusively for the forward purchase of currencies in
which the company has known or anticipated payments. These are
primarily for intercompany transactions, resulting in a high degree
of confidence that the anticipated transactions will take place.
Monetary assets of the company held in foreign currencies have
relatively short maturities and are denominated in currencies that
have not experienced wide short-term fluctuations in their
equivalent U.S. dollar values. Please refer to Note 4 of the Notes
to Consolidated Financial Statements of this report for current
details of the company's foreign exchange contracts.
Legal Proceedings
For a discussion of pending legal proceedings and related matters,
please see Note 5, Commitments and Contingencies, of the Notes to
Consolidated Financial Statements on page II-21.
Acquisitions
For information on the company's acquisitions of businesses, please
see Note 2 of the Notes to Consolidated Financial Statements on
page II-17.
II-10
<PAGE>
Item 8. Financial Statements and Supplementary Data
Report of Independent Public Accountants
To the Shareholders and Board of
Directors of C. R. Bard, Inc.:
We have audited the accompanying consolidated balance sheets
of C. R. Bard, Inc. (a New Jersey corporation) and subsidiaries as
of December 31, 1996 and 1995 and the related consolidated
statements of income, retained earnings and cash flows for each of
the three years in the period ended December 31, 1996. These
financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of
C. R. Bard, Inc. and subsidiaries as of December 31, 1996 and 1995,
and the results of their operations and their cash flows for each
of the three years in the period ended December 31, 1996 in
conformity with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Roseland, New Jersey
January 24, 1997
II-11
<PAGE>
<TABLE>
C. R. BARD, INC. AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED INCOME
<CAPTION>
(Thousands of dollars except For the Years Ended December 31,
per share amounts) 1996 1995 1994
<S> <C> <C> <C>
Net sales $1,194,400 $1,137,800 $1,064,600
Costs and expenses:
Cost of goods sold 581,300 550,000 513,500
Marketing, selling
and administrative 365,800 354,600 326,500
Research and development 77,300 75,600 71,600
Interest expense 26,400 24,200 16,300
Costs to combine
operations 9,000 17,700 ---
Other(income)expense, net 31,900 (7,800) 32,600
Total costs & expenses 1,091,700 1,014,300 960,500
Income before taxes 102,700 123,500 104,100
Income tax provision 10,200 36,700 28,500
Net income $ 92,500 $ 86,800 $ 75,600
Net income per share $ 1.62 $ 1.53 $ 1.34
</TABLE>
<TABLE>
C. R. BARD, INC. AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED RETAINED EARNINGS
<CAPTION>
(Thousands of dollars except For the Years Ended December 31,
per share amounts) 1996 1995 1994
<S> <C> <C> <C>
Balance, beginning of year $ 478,900 $ 427,300 $ 392,800
Net income 92,500 86,800 75,600
Cash dividends (per share
1996, $.66; 1995, $.62;
1994, $.58) (37,700) (33,100) (30,100)
Excess of cost over par value
of treasury stock retired
(1996-813,700 shares,
1995-75,000 shares and
1994-350,000 shares) (27,000) (2,100) (8,900)
Adjustment to give
effect to change in
reporting period for
MedChem --- --- (2,100)
Balance, end of year $ 506,700 $ 478,900 $ 427,300
<FN>
</TABLE>
The accompanying notes to consolidated financial statements are an
integral part of these statements.
II-12
<PAGE>
<TABLE>
C. R. BARD, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<CAPTION>
(Thousands of dollars) December 31,
1996 1995
<S> <C> <C>
Assets
Current assets:
Cash $ 11,300 $ 9,300
Short-term investments 66,700 42,000
Accounts receivable, less reserve of
$10,200 and $9,700 245,400 215,700
Inventories 245,000 228,200
Other current assets 8,500 8,700
Total current assets 576,900 503,900
Property, plant and equipment, at cost:
Land 11,700 11,200
Buildings and improvements 158,700 147,500
Machinery and equipment 194,200 179,200
364,600 337,900
Less - Accumulated depreciation and
amortization 138,500 123,700
Net property, plant and equipment 226,100 214,200
Intangible assets, net of amortization 447,200 315,500
Other assets 82,300 57,400
$1,332,500 $1,091,000
Liabilities and shareholders' investment
Current liabilities:
Short-term borrowings and current
maturities of long-term debt $ 148,200 $ 66,900
Accounts payable 59,200 62,700
Accrued compensation and benefits 40,300 39,800
Accrued expenses 81,200 91,600
Federal and foreign income taxes 7,300 12,300
Total current liabilities 336,200 273,300
Long-term debt 342,800 198,400
Other long-term liabilities 52,000 54,700
Commitments and contingencies --- ---
Shareholders' investment:
Preferred stock, $1 par value, authorized
5,000,000 shares; none issued --- ---
Common stock, $.25 par value, authorized
300,000,000 shares; issued
and outstanding 56,985,983 shares
in 1996, 57,100,598 shares in 1995 14,300 14,300
Capital in excess of par value 77,500 63,300
Retained earnings 506,700 478,900
Other 3,000 8,100
Total shareholders' investment 601,500 564,600
$1,332,500 $1,091,000
<FN>
</TABLE>
The accompanying notes to consolidated financial statements are an
integral part of these balance sheets.
II-13
<PAGE>
<TABLE>
C. R. BARD, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>
(Thousands of dollars)
For the Years Ended December 31,
1996 1995 1994
<S> <C> <C> <C>
Cash flows from operating activities:
Net income $ 92,500 $ 86,800 $ 75,600
Adjustments to reconcile net
income to net cash provided
from operating activities:
Depreciation and amortization 57,400 50,600 43,400
Deferred income taxes 7,300 (1,600) (4,400)
Expenses under stock plans 2,300 2,000 1,400
Asset write down & tax reserve
reversal, net 15,400 0 0
Changes in assets and
liabilities net of acquired
businesses:
Accounts receivable (21,500) (21,600) (7,600)
Inventories (9,800) (15,800) (16,300)
Other assets 6,000 8,900 9,400
Current liabilities, excluding
debt (24,400) 29,100 (23,100)
Other long-term liabilities (2,700) (21,700) (7,200)
Net cash provided from operating
activities 122,500 116,700 71,200
Cash flows from investing activities:
Capital expenditures (41,600) (39,600) (37,100)
Payments made for purchases of
businesses (199,400) (300) (122,200)
Patents, trademarks and other (37,700) (18,600) (25,500)
Net cash used in investing
activities (278,700) (58,500) (184,800)
Cash flows from financing activities:
Common stock issued for options and
benefit plans 11,500 9,500 2,900
Purchase of common stock (27,200) (2,100) (9,000)
Proceeds from long-term
borrowings 166,400 126,300 3,300
Debt issuance costs (6,800) 0 0
Principal payments of long-term
borrowings (3,100) (22,000) (1,100)
Proceeds from(repayments of)
short-term borrowings, net 79,700 (133,700) 102,000
Dividends paid (37,700) (33,100) (30,100)
Net cash provided by (used in)
financing activities 182,800 (55,100) 68,000
Translation adjustment (400) (200) 4,300
Cash and cash equivalents:
Increase(decrease) during the
year 26,200 2,900 (41,300)
Balance at January 1, 37,400 34,500 75,800
Balance at December 31, $63,600 $ 37,400 $ 34,500
<FN>
</TABLE>
The accompanying notes to consolidated financial statements are an
integral part of these statements.
II-14
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
C. R. Bard, Inc. ("the company" or "Bard") is a leading
multinational developer, manufacturer and marketer of health care
products. The company markets its products worldwide to hospitals,
individual health care professionals, extended care facilities and
alternate site facilities. The company holds strong positions in
cardiovascular, urological and surgical products.
1. Significant Accounting Policies
Consolidation The consolidated financial statements include the
accounts of the company and its majority-owned subsidiaries. All
significant intercompany accounts and transactions are eliminated
in consolidation.
Income Per Share The computations of income per share are based on
the weighted average number of shares outstanding: 57,090,130 in
1996, 56,730,542 in 1995 and 56,460,762 in 1994. The effect of
outstanding stock options and stock awards is not material and has
been excluded from the computations.
Inventories Inventories are stated at the lower of cost or market.
Substantially all domestic inventories are accounted for using the
LIFO method of determining costs. All other inventories are
accounted for using the FIFO method. Inventories valued under the
LIFO method were $151,000,000 in 1996, $140,000,000 in 1995 and
$138,000,000 in 1994; under the FIFO method such inventories would
have been higher by $15,800,000, $15,700,000 and $13,300,000,
respectively. The following is a summary of inventories at
December 31:
(Thousands of dollars) 1996 1995
Finished goods $148,300 $130,700
Work in process 59,500 72,600
Raw materials 37,200 24,900
$245,000 $228,200
Depreciation Property, plant and equipment are depreciated on a
straight-line basis over the useful lives of the various classes of
assets.
Short-term Investments Short-term investments which have a maturity
of ninety days or less are considered cash equivalents and amounted
to $52,300,000 and $28,100,000 as of December 31, 1996 and 1995.
Short-term investments are stated at cost which approximates their
market value.
II-15
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Intangible Assets Goodwill is amortized using the straight-line
method over periods of 15-40 years as appropriate and other
intangible assets are amortized over their useful lives. The
company continually evaluates its intangibles to assess
recoverability from future operations using undiscounted cash
flows. Impairment would be recognized in operating results if a
permanent diminution in value occurred.
As of December 31, 1996 and 1995, intangible assets include the
following:
(Thousands of dollars) 1996 1995
Goodwill $392,300 $231,900
Other intangibles (primarily 162,900 173,500
patents)
Less accumulated amortization (108,000) (89,900)
Intangible assets, net $447,200 $315,500
Federal Income Taxes The company has not provided for federal
income taxes on the undistributed earnings of its foreign
operations (primarily in Ireland) as it is the company's intention
to permanently reinvest undistributed earnings (approximately
$262,000,000 as of December 31, 1996).
Stock-Based Compensation Stock-based compensation is recognized
using the intrinsic value method. For disclosure purposes, pro
forma net income and earnings per share are provided as if the fair
value method had been applied.
Concentrations of Credit Risk Financial instruments, which
potentially subject the company to significant concentrations of
credit risk, consist principally of cash investments, foreign
currency exchange contracts, and trade accounts receivable.
The company maintains cash and cash equivalents, investments, and
certain other financial instruments with various major financial
institutions. The company performs periodic evaluations of the
relative credit standing of these financial institutions and limits
the amount of credit exposure with any institution.
Concentrations of credit risk with respect to trade accounts
receivable are limited due to the large number of customers and
their dispersion across many geographic areas. However, a
significant amount of trade receivables are with national health
care systems in several countries. Although the company does not
currently foresee a credit risk associated with these receivables,
repayment is dependent upon the financial stability of those
countries' national economies.
II-16
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Use of Estimates The financial statements and related disclosures
have been prepared in conformity with generally accepted accounting
principles and, accordingly, include amounts based on informed
estimates and judgments of management with consideration given to
materiality. Actual results could differ from those estimates.
Reclassifications Certain prior year amounts have been reclassified
to conform with the current year presentation.
2. Acquisitions
In September of 1996 Bard completed the acquisition of IMPRA, Inc.
("IMPRA"), a company that develops, manufactures and markets
vascular grafts used for blood vessel replacement surgery. The
purchase and acquisition costs which approximated $155,400,000 were
financed with commercial paper. This acquisition has been
accounted for under the purchase method of accounting and,
accordingly, IMPRA's assets and liabilities have been recorded at
their estimated fair market values and the excess purchase price
of $140,900,000 has been assigned to goodwill. This acquisition
did not have a significant effect on the company's results of
operations. The 1996 costs to combine operations related to the
acquisition were $9,000,000.
During 1996, the company acquired St. Jude Medical's Cardiac Assist
Division and X-Trode S.r.l. These acquisitions have been accounted
for under the purchase method of accounting and enhance or expand
the company's existing product lines and further develop
international markets. The cost of these acquisitions amounted to
$44,000,000 and were financed through internally generated cash and
available credit lines. These acquisitions did not have a
significant effect on the company's results of operations.
In September 1995, the company completed a merger with MedChem
Products, Inc. ("MedChem") issuing 3,192,345 shares of its common
stock in exchange for all outstanding common stock of MedChem. In
October 1995, the company completed a merger with American Hydro-Surgical
Instruments, Inc. ("AHS") issuing 1,338,446 shares of its
common stock in exchange for all outstanding common stock of AHS.
These mergers were accounted for as poolings of interests and,
accordingly, the company's consolidated financial statements for
prior periods were restated in 1995. In connection with these
mergers, $17,700,000 of merger related costs and expenses
($13,500,000 after-tax or $.24 per share) were incurred and have
been charged to expense in 1995. These one-time charges include
expenses primarily related to investment bankers and professional
fees, and key personnel and severance related costs.
II-17
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
2. Acquisitions (continued)
During 1994 the company acquired several companies which are
primarily located outside the United States. These acquisitions
have been accounted for under the purchase method of accounting and
enhance or expand the company's existing product lines and further
develop international markets. The cost of these acquisitions
amounted to $118,200,000 and were financed through internally
generated cash and available credit lines. These acquisitions did
not have a significant effect on the company's results of
operations.
3. Income Tax Expense
Income tax expense consists of the following:
(Thousands of dollars) 1996 1995 1994
Currently payable:
Federal $ (6,300) $ 23,600 $ 22,300
Foreign 7,500 8,900 8,100
State 1,700 5,800 2,500
2,900 38,300 32,900
Deferred:
Federal 7,600 (1,700) (3,300)
Foreign (300) 100 (1,100)
7,300 (1,600) (4,400)
$ 10,200 $36,700 $ 28,500
Deferred income taxes are recognized for the tax consequences of
"temporary differences" by applying enacted statutory tax rates,
applicable to future years, to differences between the financial
reporting and the tax basis of assets and liabilities. At
December 31, 1996, the company's net deferred tax asset amounted to
approximately $22,900,000 which is recorded in other assets. This
amount principally comprises the tax effects of the differences
between tax and financial accounting treatment of employee benefits
of $14,200,000, accrued expenses of $10,200,000 and other temporary
differences offset by the effect of accelerated depreciation
($7,800,000).
II-18
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
3. Income Tax Expense (continued)
The following is a reconciliation between the effective tax rates
and the statutory rates:
1996 1995 1994
U.S. federal statutory rate 35% 35% 35%
State income taxes net of
federal income tax benefits 3 3 2
Foreign operations taxed at
less than the U.S. statutory
rate, primarily Ireland and
Puerto Rico (13) (11) (10)
Reversal of tax reserve (15) --- ---
Other, net --- 3 ---
Effective tax rate 10% 30% 27%
During 1996, the company reversed certain tax reserves
approximating $15,000,000 that were no longer deemed necessary.
Cash payments for income taxes were $27,100,000, $34,100,000 and
$47,400,000 in 1996, 1995 and 1994, respectively.
4. Short-Term Borrowings and Long-Term Debt
The company maintains uncommitted lines of credit, a commercial
paper program and a committed credit facility which supports the
commercial paper program. Total short-term borrowings amounted to
$146,300,000 and $66,800,000 at December 31, 1996 and 1995,
respectively. The maximum amount outstanding during 1996 was
approximately $289,400,000 with an average outstanding balance of
$165,700,000 and an effective rate of 5.38%.
Short-term borrowings under uncommitted lines of credit amounted to
$71,400,000 at December 31, 1996. Unused uncommitted lines of
credit available to the company amounted to $238,700,000 at
December 31, 1996. In 1996, the company initiated a $350,000,000
commercial paper program of which $194,900,000 was outstanding at
December 31, 1996. Borrowings of $120,000,000 have been classified
as long-term debt since the company has both the intention and
ability through its committed credit lines to refinance these
amounts on a long-term basis. The committed line of credit is a
facility with 11 banks through which the company can borrow at
rates slightly above LIBOR through June 2000. The company had no
borrowings under the committed line of credit at December 31, 1996.
As a result of the long-term debt offering, discussed below, the
company amended its commercial paper program and committed line of
credit from $350,000,000 to $300,000,000, effective January 1,
1997.
II-19
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
4. Short-Term Borrowings and Long-Term Debt (continued)
The following is a summary of long-term debt:
(Thousands of dollars) 1996 1995
8.69% notes due 1999 $ 60,000 $ 60,000
7.8% mortgage loan 9,500 9,100
Commercial paper and bank borrowings 120,000 120,000
6.70% notes due 2026 150,000 0
Other 5,200 9,400
$344,700 $198,500
Less: amounts classified as current: 1,900 100
$342,800 $198,400
In June 1996, the company filed a shelf registration with the
Securities and Exchange Commission for the future issuance of up to
$200,000,000 of long-term debt. As part of the registration, in
December 1996 the company issued $150,000,000 of long-term notes
due 2026. The effective interest of the notes, including the
financing costs, is 7.17%. These notes may be redeemed at the
option of the note holder on December 1, 2006, at a redemption
price equal to the principal amount.
Under five deposit loan agreements with a bank, $48,000,000 has
been borrowed at floating rates (4.34% at December 31, 1996) with
various maturity dates from September 1997 through July 2004. At
maturity, the loans are to be repaid through matured certificates
of deposits held by the company at the same bank. Since the
company has the right of offset under these agreements and it is
the company's intention to present these certificates of deposit
for repayment of these loans at their maturity, the borrowings have
been offset against these certificates of deposit in the
accompanying consolidated balance sheet at December 31, 1996. The
related interest income has been offset against the interest
expense.
As of December 31, 1996, the aggregate maturities of long-term debt
were as follows: 1997 - $1,900,000; 1998 - $1,200,000; 1999-$61,200,000;
2000 - $121,200,000; 2001 - $1,200,000; 2002 and thereafter - $158,000,000.
The fair value of the company's long-term debt is not significantly
different from its recorded value. Interest expense in 1996, 1995 and 1994
approximated the cash outlay in each year.
II-20
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
4. Short-Term Borrowings and Long-Term Debt (continued)
The company's debt agreements contain restrictions which, among
other things, require the maintenance of minimum net worth and
operating cash flow levels and limitations on the amounts of debt.
The company enters into foreign exchange contracts to help reduce
the exposure to fluctuations between certain currencies. In 1996
and 1995, the contracts primarily related to the anticipated normal
purchases by a subsidiary in Japan from a subsidiary in Ireland.
At December 31, 1995, there were Irish pound contracts outstanding
payable in Japanese yen equivalent to $5,800,000. Early in 1996
the company entered into similar contracts equivalent
to $15,700,000. There were no contracts outstanding at the end of
1996.
5. Commitments and Contingencies
During 1994 the company recorded a $28.2 million pretax charge
($16.9 million charge after taxes). This charge related to the
settlement of a 1992 lawsuit by the inventor of an atherectomy
device and includes a provision for legal costs, and other costs
related to the USCI division. During 1996 the remaining accrual of
$2.5 million pretax related to this charge was deemed to be no
longer required as a result of the elimination of a contractual
arrangement and credited to other income.
The company is involved in two lawsuits which allege breaches of
agreements where substantial amounts have been claimed. In
addition, judgments have been rendered against the company
potentially aggregating as much as $5 million. The company is
presently appealing these judgments. The company is also subject
to other legal proceedings and claims involving product liability
and disputes on agreements which arise in the ordinary course of
business. The company believes that these legal matters will
likely be disposed of over an extended period of time and should
not have a material adverse impact on the company's financial
position or results of operations.
The company is committed under noncancelable operating leases
involving certain facilities and equipment. The minimum annual
rentals under the terms of these leases are as follows: 1997 -
$19,600,000; 1998 - $14,300,000; 1999 - $7,300,000; 2000 -
$4,800,000; 2001 - $3,500,000; and thereafter - $12,700,000. Total
rental expense for all leases approximated $28,400,000 in 1996,
$29,300,000 in 1995 and $26,800,000 in 1994.
II-21
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
6. Stock Rights
In October 1995 the company's Board of Directors declared a
dividend distribution of one Common Share Purchase Right for each
outstanding share of Bard common stock. These Rights will expire
in October 2005 and trade with the company's common stock. Such
Rights are not presently exercisable and have no voting power. In
the event a person acquires 20% or more, or makes a tender or
exchange offer for 30% or more of Bard's common stock, the Rights
detach from the common stock and become exercisable and entitle a
holder to buy one share of common stock at $120.00 (adjustable to
prevent dilution).
If, after the Rights become exercisable, Bard is acquired or
merged, each Right will entitle its holder to purchase $240 market
value of the surviving company's stock for $120, based upon the
current exercise price of the Rights. The company may redeem the
Rights, at its option, at $.05 per Right, prior to a public
announcement that any person has acquired beneficial ownership of
at least 20% of Bard's common stock. These Rights are designed
primarily to encourage anyone interested in acquiring Bard to
negotiate with the Board of Directors. There are 60 million shares
of common stock reserved for the rights.
7. Shareholders' Investment
The company has stock option, stock award and restricted stock
plans under which certain directors, officers and employees are
participants. In 1996, shareholders of the company approved the
addition of 1,550,000 shares to the 1993 Long-term Incentive Plan.
At December 31, 1996, 1,240,170 shares were reserved for issuance
under all company plans.
Under the company's stock option plans, options have been granted
to certain directors, officers and employees at prices equal to the
market value of the shares at the date of grant, become exercisable
in four annual installments and expire not more than 10 years after
the date of grant.
In accordance with Statement of Financial Accounting Standards No.
123, "Accounting for Stock-Based Compensation" ("FAS 123"), which
was effective as of January 1, 1996, the fair value of option
grants is estimated on the date of grant using the Black-Scholes
option-pricing model for proforma footnote purposes with the
following assumptions used for grants in all years; dividend yield
of 2%, risk-free interest rate of 6.67% and expected option life of
4.4 years. Expected volatility was assumed to be 33% in 1995 and
29% in 1996.
II-22
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
7. Shareholders' Investment (continued)
Weighted Weighted
Number Average Average
Of Exercise Fair
Shares Price Value
Options outstanding,
December 31, 1993 3,062,320 $22.59
Granted 1,065,885 $21.57
Exercised (225,855) $14.93
Canceled (264,770) $27.93
Options outstanding,
December 31, 1994 3,637,580 $22.38
(1,881,918 exercisable)
Granted 853,075 $34.42 $7.94
Exercised (563,444) $18.37
Canceled (235,272) $50.55
Options outstanding,
December 31, 1995 3,691,939 $23.98
(2,038,844 exercisable)
Granted 703,940 $32.89 $9.61
Exercised (688,708) $20.47
Canceled (202,116) $26.91
Options outstanding,
December 31, 1996 3,505,055 $26.31
(1,905,876 exercisable)
The following table summarizes information about stock options
outstanding at December 31, 1996:
Weighted Weighted Weighted
Range of Number Average Average Number Average
Exercise Outstanding Remaining Exercise Exercisable Exercise
Prices at 12/31/96 Life Price at 12/31/96 Price
$10 to 21 482,967 5.5 $17.28 427,886 $16.86
$21 to 24 753,648 5.4 $22.50 455,865 $22.46
$24 to 27 892,993 6.3 $26.44 792,462 $26.41
$27 to 30 631,479 7.2 $29.67 170,358 $29.55
$30 to 41 743,968 8.9 $33.09 59,305 $35.33
$10 to 41 3,505,055 6.5 $26.31 1,905,876 $24.01
As permitted by FAS 123, the company has chosen to continue
accounting for stock options at their intrinsic value. Accordingly
no compensation expense has been recognized for its stock option
compensation plans. Had the fair value method of accounting been
applied to the company's stock option plans, the tax-effected
impact would be as follows:
II-23
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
7. Shareholders' Investment (continued)
(Thousands of dollars except per share amounts)
1996 1995
Net income as reported $92,500 $86,800
Estimated fair value of the
year's option grants,
net of tax (1,700) (600)
Net income adjusted $90,800 $86,200
Adjusted net income per share $ 1.59 $ 1.52
This proforma impact only takes into account options granted since
January 1, 1995 and is likely to increase in future years as
additional options are granted and amortized ratably over the
vesting period.
Under the company's stock award plans for key employees and
directors, shares are granted at no cost to the recipients and
distributed in three separate installments. During 1996 awards for
26,742 shares (net of cancellations) were granted and 28,837 shares
were issued. Awards are charged to income over the vesting period.
At December 31, 1996, 28,124 awarded shares (aggregate market price
at date of grant $899,000) have not been issued.
Under the company's restricted stock plan, which was established in
1993, common stock may be granted at no cost to certain officers
and key employees. Shares are issued to the participants at the
date of grant entitling the participants to cash dividends and the
right to vote their respective shares. Restrictions limit the sale
or transfer of these shares during a five year period from the
grant date. Upon issuance of stock under the plan, unearned
compensation ($5,000,000 at December 31, 1996) equivalent to the
market value of the stock at the date of grant is reflected in
shareholders' investment and subsequently amortized to expense over
the five year restriction period. During 1996, 71,610 shares were
granted, net of forfeitures.
Additions to capital in excess of par value of $14,200,000 in 1996
and $12,300,000 in 1995 relate to shares issued under these plans
in excess of the related par value of the shares.
II-24
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
7. Shareholders' Investment (continued)
For shares purchased by the company, common stock is charged for
the par value of the shares retired and retained earnings is
charged for the excess of the cost over the par value of shares
retired.
Cumulative foreign currency translation included in other
shareholders' investment amounted to $8,000,000 at
December 31, 1996, and decreased by $4,400,000 during the year.
8. Postretirement Benefits
The company has defined benefit pension plans which cover
substantially all domestic and certain foreign employees and its
policy is to fund accrued pension expense for these plans up to the
full funding limitations. These plans provide for benefits based
upon individual participants' compensation and years of service.
The company also has a supplemental defined contribution plan for
certain officers and key employees. Individual participant
accounts under the supplemental plan are credited annually based
upon a percentage of compensation. The amounts charged to income
for these plans amounted to $13,800,000 in 1996, $12,800,000 in
1995 and $13,600,000 in 1994.
The following table sets forth the funded status of the defined
benefit pension plans as of September 30, 1996 and 1995 and amounts
recognized in the company's consolidated balance sheets at
December 31, 1996 and 1995:
(Thousands of dollars) 1996 1995
Actuarial present value of accumulated
benefit obligation, including vested
benefits of $75,000 in 1996 and $68,000
in 1995 $ 84,400 $ 76,400
Plan assets at fair value, primarily
investment securities $ 97,000 $ 77,300
Less: Actuarial present value of
projected benefit obligation for
service rendered to date 102,400 92,500
Projected benefit obligation in excess
of plan assets (5,400) (15,200)
Unrecognized (income) loss (600) 6,400
Unrecognized prior service cost 6,700 7,600
Unrecognized net asset at transition
amortized over 12 years (2,500) (3,400)
Accrued pension cost included in other
liabilities $ (1,800) $ (4,600)
II-25
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
8. Postretirement Benefits
Pension costs related to the defined benefit pension plans for
the years ended December 31, 1996, 1995 and 1994 are as follows:
(Thousands of dollars) 1996 1995 1994
Net pension cost includes:
Service cost $ 7,000 $ 6,800 $ 8,000
Interest cost 7,000 6,700 6,700
Actual return on plan
assets (12,000) (12,800) (2,600)
Net amortization and deferral 5,400 6,000 (3,500)
Net pension cost $ 7,400 $ 6,700 $ 8,600
The range of assumed discount rates used was 4.00% to 8.50% with
the rate on domestic plans at 8.00% in 1996 and 7.75% in 1995. The
rate of increase in future salary levels ranged from 2.00% to 6.50%
in determining the projected benefit obligation. The expected
long-term rate of return on assets used in determining net pension
cost ranged from 7.75% to 9.00%.
The company also provides postretirement health care benefits and
life insurance coverage to a limited number of employees at a
subsidiary. The health care benefits include cost-sharing features
based on years of service for future retirees. The company
recognizes expense as employees earn postretirement benefits. The
amounts charged to income for this plan were approximately $600,000
in 1996 ($100,000 of service cost and $500,000 of interest cost)
and $800,000 in 1995 and 1994.
Actuarial assumptions included a discount rate of 8.00%. Health
care cost trends have been projected at annual rates beginning at
11% for 1996 decreasing gradually down to 6% in 2001 and later
years. The effect of a 1% annual increase in these assumed cost
trend rates would increase the accumulated postretirement benefit
obligation at December 31, 1996, by $700,000 and postretirement
benefit cost by $100,000.
II-26
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
9. Other (Income) Expense, Net
In addition to recurring items such as interest income and foreign
exchange, other income and expense includes several one-time items.
During 1996, the company reorganized its global cardiology business
and recorded a $31,000,000 ($16,800,000 net of tax) writedown of
assets related to its guidewire technology in accordance with the
requirements of SFAS No. 121 "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed of". In
addition, the company recorded a one-time charge of $10,000,000
($6,200,000 net of tax) related to the reorganization of certain
existing manufacturing operations and $9,200,000 in income
($5,500,000 net of tax) related to royalty payments received on
sales of certain licensed angioplasty products for prior periods.
Other (income) expense, net in the Statements of Consolidated
Income is summarized as follows:
(Thousands of dollars) 1996 1995 1994
Interest Income $ (3,800) $(3,400) $ (4,600)
Foreign exchange (gains)losses 400 (3,300) (400)
Asset writedown 31,000 --- ---
Manufacturing reorganization 10,000 --- ---
Prior period royalties (9,200) --- ---
Legal fees and settlements, net
(Note 5) 3,500 --- 28,200
Other, net --- (1,100) 9,400
Total $ 31,900 $(7,800) $ 32,600
II-27
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
10. Segment Information
The company is engaged in the design, manufacture, packaging,
distribution and sale of medical, surgical, diagnostic and patient
care devices. Hospitals, physicians and nursing homes purchase
approximately 90% of the company's products, most of which are used
once and discarded. Information pertaining to domestic and foreign
operations as of December 31, 1996, 1995 and 1994 and for the years
then ended is given below.
<TABLE>
<CAPTION>
(Thousands of dollars)
United Elimi- Consoli-
States Foreign nations dated
<S> <C> <C> <C> <C>
1996
Sales:
Trade $782,000 $375,100 $ --- $1,157,100
Export 37,300 --- --- 37,300
Intersegment 115,100 21,300 (136,400) ---
Total $934,400 $396,400 $(136,400) $1,194,400
Operating income $125,800 $ 68,500 $ (33,300)(a) $ 161,000
Identifiable assets:
December 31, 1996 $940,600 $391,900 $ --- $1,332,500
1995
Sales:
Trade $749,000 $353,500 $ --- $1,102,500
Export 35,300 --- --- 35,300
Intersegment 95,800 10,400 (106,200) ---
Total $880,100 $363,900 $(106,200) $1,137,800
Operating income $102,800 $ 66,600 $ (29,500)(a) $ 139,900
Identifiable assets:
December 31, 1995 $747,000 $344,000 $ --- $1,091,000
1994
Sales:
Trade $751,500 $283,500 $ --- $1,035,000
Export 29,600 --- --- 29,600
Intersegment 97,700 4,400 (102,100) ---
Total $878,800 $287,900 $(102,100) $1,064,600
Operating income $106,700 $ 59,000 $ (12,700) $ 153,000
Identifiable assets:
December 31, 1994 $734,000 $309,100 $ --- $1,043,100
<FN>
</TABLE>
(a) Includes nonrecurring acquisition costs of $9,000 and $17,700
in 1996 and 1995, respectively.
II-28
<PAGE>
<TABLE>
C. R. BARD, INC. AND SUBSIDIARIES
QUARTERLY FINANCIAL DATA
1996
1st 2nd 3rd 4th Year
<CAPTION>
(Thousands of dollars
except per share amounts)
<S> <C> <C> <C> <C> <C>
Net sales $289,200 $295,200 $295,800 $314,200 $1,194,400
Cost of goods
sold 140,600 143,300 146,600 150,800 581,300
Income before
taxes 10,600 39,000 15,200 37,900 102,700
Net income 27,100 27,500 11,400 26,500 92,500
Per share information:
Net Income $ .48 $ .48 $ .20 $ .46 $ 1.62
Dividends $ .16 $ .16 $ .17 $ .17 $ .66
</TABLE>
Note: The first quarter included nonrecurring items related to an
asset writedown, the receipt of revenues related to prior
year royalties, miscellaneous charges and tax reserve
reversals reducing pretax income by $27,100 with a positive
after-tax impact of approximately 1 cent per share. The
second quarter included a one-time credit of $2,500 related
to the elimination of a contractual arrangement which, if
excluded, would have had a negative after-tax impact of
approximately 2 cents per share. Reflected in the third
quarter results are one-time charges of $10,000 related to
the reorganization of certain existing manufacturing
operations and $9,000 of expenses as a result of the IMPRA
acquisition with a negative after-tax impact of approximately
11 cents per share and 12 cents per share respectively.
<TABLE>
<CAPTION>
1995
1st 2nd 3rd 4th Year
(Thousands of dollars
except per share amounts)
<S> <C> <C> <C> <C> <C>
Net sales $278,100 $291,100 $277,600 $291,000 $1,137,800
Cost of goods
sold 134,200 140,600 134,200 141,000 550,000
Income before
taxes 35,400 35,900 21,200 31,000 123,500
Net income 24,900 25,000 14,100 22,800 86,800
Per share information:
Net Income $ .44 $ .44 $ .25 $ .40 $ 1.53
Dividends $ .15 $ .15 $ .16 $ .16 $ .62
<FN>
</TABLE>
Note: The third quarter results include a $12,500 charge (18 cents
per share after-tax) for costs associated with the merger of
MedChem Products, Inc. The fourth quarter results include
a $5,200 charge (6 cents per share after-tax) for costs
associated with the merger of American Hydrosurgical
Instruments, Inc.
II-29
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure
Not applicable.
II-30
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
PART III
Item 10. Directors and Executive Officers of the Registrant
Directors of the Registrant
Information with respect to Directors of the company is
incorporated herein by reference to the material contained under
the heading "Proposal No. 1 - Election of Directors" appearing on
pages 1 through 4 of the Company's definitive Proxy Statement dated
March 7, 1997.
Executive Officers of the Registrant
Information with respect to Executive Officers of the Registrant
are on pages I-9 through I-11 of this filing.
Item 11. Executive Compensation
The information contained under the caption "Executive
Compensation" appearing on Pages 7 through 8 of the Company's
definitive Proxy Statement dated March 7, 1997 is incorporated
herein by reference.
Item 12. Security Ownership of Certain Beneficial Owners and
Management
The information contained under the captions "Securities Ownership
of Certain Beneficial Owners" and "Securities Ownership of
Management" on pages 5 and 6 of the Company's definitive Proxy
Statement dated March 7, 1997 is incorporated herein by reference.
Item 13. Certain Relationships and Related Transactions
The information contained under the caption "Compensation of
Outside Directors - Related Transactions" on page 15 of the
Company's definitive Proxy Statement dated March 7, 1997 is
incorporated herein by reference.
III-1
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K
(a) l. Financial Statements and Supplementary Data
Included in Part II Item 8 of this report:
Page
II-11 Report of Independent Public Accountants.
II-12 Statements of Consolidated Income and Statements of
Consolidated Retained Earnings for the three years
ended December 31, 1996.
II-13 Consolidated Balance Sheets at December 31, 1996 and
1995.
II-14 Consolidated Statements of Cash Flows for the three
years ended December 31, 1996.
II-15 Notes to Consolidated Financial Statements.
II-29 Quarterly Financial Data.
2. Financial Statement Schedules
Schedules are omitted because they are not applicable, are
not required or the information required is included in the
financial statements or notes thereto.
3. Exhibits, No.
3a Registrant's Restated Certificate of Incorporation, as
amended, as of April 17, 1996, filed as Exhibit 3 to
the Company's September 30, 1996 Form 10-Q is
incorporated herein by reference.
3b Registrant's Bylaws revised as of September 11, 1996.
(p. IV-8).
4a Rights Agreement dated as of October 11, 1995 between
C. R. Bard, Inc. and First Chicago Trust Company of
New York as Rights Agent, filed as Exhibit 1
to the Company's Registration Statement on Form 8-A
filed with the Securities and Exchange Commission on
October 12, 1995 is incorporated herein by reference.
4b Indenture, dated as of December 1, 1996 between C. R.
Bard, Inc. and the Chase Manhattan Bank, as trustee,
filed as Exhibit 4.1 to the Company's Registration
Statement on Form S-3, File No. 333-05997 is
incorporated herein by reference.
IV-1
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
3. Exhibits, No. (Continued)
10 Plea Agreement with attachments and Civil Settlement
Agreement between United States of America and C. R.
Bard, Inc. dated October 14, 1993, filed as Exhibit 10
to the Company's Quarterly Report on Form 10-Q for the
quarter ended September 30, 1993, File No. 1-6926 is
incorporated herein by reference.
10a* Benson F. Smith Severance Agreement dated as of
June 29, 1994 filed as Exhibit 10a to the 1994 Annual
Report on Form 10-K is incorporated herein by
reference.
10b* William H. Longfield Severance Agreement as amended
dated as of July 13, 1994 filed as Exhibit 10b to the
1994 Annual Report on Form 10-K is incorporated herein
by reference.
10c* William C. Bopp Severance Agreement as amended dated
as of August 31, 1994 filed as Exhibit 10c to the 1994
Annual Report on Form 10-K is incorporated herein by
reference.
10d* Hope Greenfield Severance Agreement dated as of
March 6, 1996 filed as Exhibit 10d to the 1995 Annual
Report on Form 10-K is incorporated herein by
reference.
10e* Richard A. Flink Severance Agreement as amended dated
as of July 22, 1994 filed as Exhibit 10e to the 1994
Annual Report on Form 10-K is incorporated herein by
reference.
10f* E. Robert Ernest Severance Agreement as amended dated
as of July 19, 1994 filed as Exhibit 10f to the 1994
Annual Report on Form 10-K is incorporated herein by
reference.
10g* William H. Longfield Supplemental Executive Retirement
Agreement dated as of January 12, 1994, filed as
Exhibit 10g to the Company's 1993 Annual Report on
Form 10-K is incorporated herein by reference.
10h* 1990 Stock Option Plan, filed as Exhibit 10h to the
Company's 1993 Annual Report on Form 10-K is
incorporated herein by reference.
10i* 1989 Employee Stock Appreciation Rights Plan, filed as
Exhibit 10i to the Company's 1993 Annual Report on
Form 10-K is incorporated herein by reference.
IV-2
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
3. Exhibits, No. (Continued)
10j* C. R. Bard, Inc. Agreement and Plans Trust, filed as
Exhibit 10j to the Company's 1993 Annual Report on
Form 10-K is incorporated herein by reference.
10k* Supplemental Insurance/Retirement Plan, Plan I - For
new corporate officer when previous agreement as non-officer exists,
Plan II - For new corporate officer when no previous agreement
exists, filed as Exhibit 10k to the Company's 1993 Annual Report on
Form 10-K is incorporated herein by reference.
10l* Retirement Plan for Outside Directors of C. R. Bard,
Inc., filed as Exhibit 10l to the Company's 1993
Annual Report on Form 10-K is incorporated herein by
reference.
10m* Deferred Compensation Contract Deferral of Directors'
Fees, as amended entered into with directors William
T. Butler, M.D., Regina E. Herzlinger, and Robert P.
Luciano, filed as Exhibit 10m to the Company's 1993
Annual Report on Form 10-K is incorporated herein by
reference.
10n* 1988 Directors Stock Award Plan, as amended in October
1991, filed as Exhibit 10n to the Company's 1993
Annual Report on Form 10-K is incorporated herein by
reference.
10o* Excess Benefit Plan, filed as Exhibit 10o to the
Company's 1993 Annual Report on Form 10-K is
incorporated herein by reference.
10p* Supplemental Executive Retirement Plan, filed as
Exhibit 10p to the Company's 1993 Annual Report on
Form 10-K is incorporated herein by reference.
10q* 1994 Executive Bonus Plan, filed as Exhibit 10 to the
Company's Quarterly Report on Form 10-Q for the
quarter ended March 31, 1994, File No. 1-6926 is
incorporated herein by reference.
10r* Long Term Performance Incentive Plan, filed as Exhibit
10r to the Company's 1993 Annual Report on Form 10-K
is incorporated herein by reference.
IV-3
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
3. Exhibits, No. (Continued)
10s* Deferred Compensation Contract Deferral of
Discretionary Bonus, filed as Exhibit 10s to the
Company's 1993 Annual Report on Form 10-K is
incorporated herein by reference.
10t* Deferred Compensation Contract Deferral of Salary,
filed as Exhibit 10t to the Company's 1993 Annual
Report on Form 10-K is incorporated herein by
reference.
10u* 1993 Long Term Incentive Plan, filed as Exhibit 10u to
the Company's 1993 Annual Report on Form 10-K is
incorporated herein by reference.
10v* Earle L. Parker Severance Agreement dated as of
June 29, 1994 filed as Exhibit 10v to the Company's
1994 Annual Report on Form 10-K is incorporated herein
by reference.
10w* John H. Weiland Severance Agreement dated as of
March 11, 1996 filed as Exhibit 10w to the Company's
1995 Annual Report on Form 10-K is incorporated herein
by reference.
10x* William T. Tumber Severance Agreement dated as of
March 13, 1996 filed as Exhibit 10x to the Company's
1995 Annual Report on Form 10-K is incorporated herein
by reference.
10y* Timothy M. Ring Severance Agreement dated as of
March 12, 1996 filed as Exhibit 10y to the Company's
1995 Annual Report on Form 10-K is incorporated herein
by reference.
10z* Guy J. Jordan Severance Agreement dated as of
October 10, 1996. (p. IV-20).
10aa* Charles P. Grom Severance Agreement dated as of
December 11, 1996. (p. IV-39).
12.1 Computation in Support of Ratio of Earnings to Fixed
Charges.
21 Subsidiaries of registrant. (p. IV-58).
23 Arthur Andersen LLP consent to the incorporation by
reference of their report on Form 10-K into previously
filed Forms S-8. (P.IV-60).
IV-4
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
3. Exhibits, No. (Continued)
27 Financial data schedule
99 Indemnity agreement between the company and each of
its directors and officers, filed as Exhibit 99 to
the Company's 1993 Annual Report on Form 10-K is
incorporated herein by reference.
* Each of these exhibits listed under the number 10 constitutes
a management contract or a compensatory plan or arrangement.
All other exhibits are not applicable.
(b) Reports on Form 8-K
(b) The Registrant filed a current Report on Form 8-K as
amended, dated September 16, 1996, announcing the
acquisition of IMPRA, Inc. and certain financial and
proforma information.
IV-5
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
Signatures
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
C. R. BARD, INC.
(Registrant)
By: William C. Bopp /s/
William C. Bopp
Executive Vice President and
Chief Financial Officer
Date: March 17, 1997
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates
indicated.
Signatures Title Date
William H. Longfield /s/ Chairman and March 17,1997
William H. Longfield Chief Executive Officer
and Director
(Principal Executive
Officer)
William C. Bopp /s/ Executive Vice President March 17, 1997
William C. Bopp and Chief Financial
Officer and Director
(Principal Financial
Officer)
Charles P. Grom /s/ Vice President and March 17, 1997
Charles P. Grom Controller
(Principal Accounting
Officer)
Benson F. Smith /s/ President and March 17, 1997
Benson F. Smith Chief Operating
Officer and Director
IV-6
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
Signatures Title Date
Joseph F. Abely, Jr. /s/ Director March 26, 1997
Joseph F. Abely, Jr.
Marc C. Breslawsky /s/ Director March 26, 1997
Marc C. Breslawsky
William T. Butler, M.D. /s/ Director March 26, 1997
William T. Butler, M.D.
Raymond B. Carey, Jr. /s/ Director March 26, 1997
Raymond B. Carey, Jr.
Daniel A. Cronin, Jr. /s/ Director March 26, 1997
Daniel A. Cronin, Jr.
T. Kevin Dunnigan /s/ Director March 26, 1997
T. Kevin Dunnigan
Regina E. Herzlinger /s/ Director March 26, 1997
Regina E. Herzlinger
Robert P. Luciano /s/ Director March 26, 1997
Robert P. Luciano
Robert H. McCaffrey /s/ Director March 26, 1997
Robert H. McCaffrey
Tony L. White /s/ Director March 26, 1997
Tony L. White
IV - 7
Exhibit 3B
BY-LAWS
of
C. R. BARD, INC.
(A New Jersey Corporation)
(Amended September 11, 1996)
ARTICLE I
Offices
The principal office of the Corporation shall be in the
Borough of New Providence, County of Union, State of New Jersey.
The Corporation may also establish and have such other offices as
needed for the conduct of its business at such other place or
places within or without the state of New Jersey as may from time
to time be designated by the Board of Directors.
ARTICLE II
Seal
The Corporate seal shall have inscribed thereon the name of
the Corporation, the year of its organization, and the words,
"CORPORATE SEAL, NEW JERSEY".
ARTICLE III
Stockholders' Meetings
Section 1. Place of Meetings. Meetings of the stockholders
may be held at the principal office in New Jersey or at such other
place within or without the State of New Jersey as from time to
time may be designated by the Board of Directors and stated in the
notice of meeting.
Section 2. Annual Meetings. The annual meeting of
stockholders for the election of Directors and the transaction of
such other business as may properly be brought before the meeting
shall be held on the third Wednesday in April in each year. If this
date shall fall upon a legal holiday, the meeting shall be held on
the next succeeding business day which is not a legal holiday.
Section 3. Business Transacted Annual Meetings. At any annual
meeting of the stockholders of the Corporation, only such business
shall be conducted as shall have been brought before the meeting
(a) by or at the direction of the Board of Directors or (b) by any
stockholder of the Corporation who complies with the procedures set
forth in this Section 3. For business properly to be brought before
an annual meeting by a stockholder, the stockholder must have given
timely notice thereof in proper written form to the Secretary of
the Corporation. To be timely, a stockholder's notice must be
IV-8
<PAGE>
delivered to or mailed and received at the principal executive
offices of the Corporation not less than 30 days nor more than 60
days prior to the meeting; provided, however, that in the event
that less than 40 days' notice or prior public disclosure of the
date of the meeting is given or made to stockholders, notice by the
stockholder to be timely must be received not later than the close
of business on the 10th day following the day on which such notice
of the date of the annual meeting was mailed or such public
disclosure was made. To be in proper written form, a stockholder's
notice to the Secretary shall set forth in writing as to each
matter the stockholder proposes to bring before the annual meeting
(a) a brief description of the business desired to be brought
before the annual meeting and the reasons for conducting such
business at the annual meeting, (b) the name and address, as they
appear on the Corporation's books, of the stockholder proposing
such business, (c) the class and number of shares of the
Corporation which are beneficially owned by the stockholder and
(d) any material interest of the stockholder in such business.
Notwithstanding anything in the By-Laws to the contrary, no
business shall be conducted at an annual meeting except in
accordance with the procedures set forth in this Section 3. The
chairman of an annual meeting shall, if the facts warrant,
determine and declare to the meeting that business was not properly
brought before the meeting in accordance with the provisions of
this Section 3, and, if he should so determine, he shall so declare
to the meeting and any such business not properly brought before
the meeting shall not be transacted.
Section 4. Special Meetings. Except as otherwise provided by
law, special meetings of the stockholders may be called at any time
by the Chairman of the Board, the President, or a majority of the
Board of Directors.
Section 5. Business Transacted Special Meetings. Business
transacted at any special meeting shall be confined to the purpose
or purposes stated in the notice thereof.
Section 6. Notice of Meetings. Written notice of the annual
meeting or of a special meeting, stating the time, place, and
purpose or purposes of the meeting, shall be given not less than
ten (10) nor more than sixty (60) days before the date of the
meeting, either personally or by mail, to each stockholder of
record entitled to vote at such meeting.
Section 7. Quorum. The holders of a majority of the stock
issued and outstanding and entitled to vote thereat, represented in
person or by proxy, shall constitute a quorum at all meetings of
the stockholders for the transaction of business except as
otherwise provided by statute or by the Certificate of
Incorporation. If, however, such quorum shall not be present or
represented at any meeting of the stockholders, the stockholders
IV-9
<PAGE>
present in person or represented by proxy shall have power to
adjourn the meeting from time to time without notice other than
announcement at the meeting, until a quorum shall be present or
represented. At such adjourned meeting at which a quorum shall be
present or represented, any business may be transacted which might
have been transacted at the meeting as originally notified.
Section 8. Voting. Whenever any action, other than the
election of directors, is to be taken by vote of the stockholders,
it shall be authorized by a majority of the votes cast at a meeting
of stockholders at which a quorum is present by the holders of
shares entitled to vote thereon, unless a greater plurality is
required by law or by the Restated Certificate of Incorporation.
Section 9. Proxies. Any stockholder of record entitled to
vote may be represented at any annual or special meeting of the
stockholders by a duly appointed proxy. All proxies shall be
written and properly signed, but shall require no other attestation
and shall be filed with the Secretary of the meeting before being
voted.
Section 10. Consents to Corporate Action. (a) Action by
Written Consent. Unless otherwise provided in the Certificate of
Incorporation, any action required or permitted to be taken at any
annual or special meeting of stockholders of the Corporation,
subject to the provisions of subsections (b) and (c) of this
Section 10, may be taken without a meeting upon the written consent
(which shall set forth the action to be so taken) of less than all
the stockholders entitled to cast at least the minimum number of
votes which would be required to take such action at a meeting at
which all stockholders entitled to vote thereon are present;
provided, however, that prompt notice of the taking of corporate
action without a meeting and by less than unanimous written consent
shall be given to those stockholders who have not consented in
writing.
(b) Determination of Record Date for Action by Written
Consent. The record date for determining stockholders entitled to
express consent to corporate action in writing without a meeting
shall be fixed by the Board of Directors of the Company. Any
stockholder seeking to have the stockholders of the Corporation
authorize or take corporate action by written consent without a
meeting shall, by written notice to the Secretary of the
Corporation, request the Board of Directors to fix a record date.
Upon receipt of such a request, the Secretary shall, as promptly as
practicable, call a special meeting of the Board of Directors to be
held as promptly as practicable. At such meeting, the Board of
Directors shall fix a record date within the limitations provided
in Section 14A:5-7 (or its successor provision) of the New Jersey
Business Corporation Act. Notice of the record date shall be
published in accordance with the rules and policies of any stock
IV-10
<PAGE>
exchange on which securities of the Company are then listed. Should
the Board of Directors fail to fix a record date as provided for in
this paragraph (b), then the record date shall be the close of
business on the day next preceding the day on which notice of the
meeting is given or, if no notice is given, the day next preceding
the day on which the meeting is held.
(c) Procedures for Written Consent. In the event of the
delivery to the Company of a written consent or consents purporting
to represent the requisite voting power to authorize or take
corporate action and/or related revocations, the Secretary of the
Corporation shall provide for the safe-keeping of such consents and
revocations and shall engage nationally recognized independent
inspectors of elections for the purpose of promptly performing a
ministerial review of the validity of the consents and revocations.
No action by written consent without a meeting shall be effective
until such inspectors have completed their review, have determined
that the requisite number of valid and unrevoked consents has been
obtained to authorize the action specified in the consents, and
have certified such determination for entry into the records of the
Corporation kept for the purpose of recording the proceedings of
meetings of stockholders.
ARTICLE IV
Directors
Section 1. Number and Term of Directors. The Board of
Directors of the Corporation shall consist of no fewer than three
and no more than fourteen Directors and shall be divided into three
classes, namely, Classes I, II and III, with each class consisting
of not fewer than one nor more than five Directors, as the Board of
Directors shall from time to time determine. In the absence of such
determination by the Board of Directors, the number shall be the
number of Directors elected at the preceding Annual Meeting of
Stockholders. At each Annual Meeting of Stockholders, the
successors to any class of Directors whose terms shall then expire
shall be elected to serve until the third Annual Meeting following
their election and until their respective successors shall have
been duly elected and qualified. Directors elected as hereinbefore
provided may not be removed prior to the expiration of their
respective terms of office without cause. Directors need not be
residents of the State of New Jersey nor stockholders of the
Corporation.
Section 2. Vacancies. Any vacancy occurring in the Board of
Directors, including any vacancy resulting from an increase in the
number of Directors, may be filled until the next succeeding Annual
Meeting of Stockholders by the affirmative vote of a majority of
the remaining Directors through less than a quorum of the Board of
Directors.
IV-11
<PAGE>
Section 3. Notice of Stockholder Nominees. Only persons who
are nominated in accordance with the procedures set forth in this
Section 3 shall be eligible for election as Directors of the
Corporation. Nominations of persons for election to the Board of
Directors of the Corporation may be made at a meeting of
stockholders (a) by or at the direction of the Board of Directors
or (b) by any stockholder of the Corporation entitled to vote for
the election of Directors at such meeting who complies with the
procedures set forth in this Section 3. All nominations by
stockholders shall be made pursuant to timely notice in proper
written form to the Secretary of the Corporation. To be timely, a
stockholder's notice shall be delivered to or mailed and received
at the principal executive offices of the Corporation not less than
30 days nor more than 60 days prior to the meeting; provided,
however, that in the event that less than 40 days' notice or prior
public disclosure of the date of the meeting is given or made to
stockholders, notice by the stockholder to be timely must be so
received not later than the close of business on the 10th day
following the day on which such notice of the date of the meeting
was mailed or such public disclosure was made. To be in proper
written form, such stockholder's notice shall set forth in writing
(a) as to each person whom the stockholder proposes to nominate for
election or re-election as a Director, all information relating to
such person that is required to be disclosed in solicitations of
proxies for election of directors, or is otherwise required, in
each case pursuant to Regulation 14A under the Securities Exchange
Act of 1934, as amended, including, without limitation, such
person's written consent to being named in the proxy statement as
a nominee and to serving as a Director if elected; and (b) as to
the stockholder giving the notice (i) the name and address, as they
appear on the Corporation's books, of such stockholder and (ii) the
class and number of shares of the Corporation which are
beneficially owned by such stockholder. At the request of the Board
of Directors, any person nominated by the Board of Directors for
election as a Director shall furnish to the Secretary of the
Corporation that information required to be set forth in a
stockholder's notice of nomination which pertains to the nominee.
In the event that a stockholder seeks to nominate one or more
Directors, the Secretary shall appoint two inspectors, who shall
not be affiliated with the Corporation, to determine whether a
stockholder has complied with this Section 3. If the inspectors
shall determine that a stockholder has not complied with this
Section 3, the inspectors shall direct the chairman of the meeting
to declare to the meeting that a nomination was not made in
accordance with the procedures prescribed by the By-Laws of the
Corporation, and the chairman shall so declare to the meeting and
the defective nomination shall be disregarded.
IV-12
<PAGE>
Section 4. Duties and Powers. The Board of Directors shall
have the control and management of the affairs of the Corporation
and shall exercise all such powers of the Corporation and do all
such lawful acts and things necessary or expedient in the control
and management thereof as are not by statute or by the Certificate
of Incorporation or by these By-Laws directed or required to be
exercised or done by the stockholders. The Directors may adopt such
rules and regulations for the conduct of their meetings and the
management of the Corporation as they may deem proper, not
inconsistent with the laws of the State of New Jersey.
Section 5. Meetings of the Board of Directors. Meetings of
the Board of Directors shall be held at the office of the
Corporation or at any other place within or without the State of
New Jersey which the Chairman of the Board, or the President or a
majority of the Board of Directors may from time to time designate.
There shall be an annual meeting of the Board of Directors held
without notice upon the day of their election or as soon thereafter
as convenient and such regular meetings, without notice, as the
Board of Directors may by resolution establish. The Chairman of the
Board or the President shall call a special meeting of the Board of
Directors whenever requested in writing by five (5) or more
Directors so to do. Two (2) days notice shall be given to each
Director by the Secretary of each special meeting of the Board of
Directors. Such notice may be given by mail, telegram or in person.
A majority of the number of Directors shall constitute a
quorum for the transaction of business, but the Director or
Directors present, if less than a quorum, may adjourn any meeting
from time to time until such quorum be present. All questions
coming before the Board shall be determined and decided by a
majority vote of Directors present. Each Director shall be entitled
to one (1) vote at all meetings of Directors.
Section 6. Compensation of Directors. Directors, as such,
shall not receive any stated salary for their services, but the
Board may, from time to time, by resolution, fix the fees or
compensation of the Directors for services as such to the
Corporation, including attendance at meetings of the Board of
Directors or any committee thereof. Nothing herein contained shall
be construed to preclude any Director from serving the Corporation
in any other capacity and receiving compensation therefor.
Section 7. Executive Committee. The Board of Directors shall
appoint an Executive Committee from the Directors, consisting of
not less than three (3) members, to constitute an Executive
Committee, which Committee shall have and exercise all of the
authority of the Board of Directors in the management of the
Corporation, except as otherwise required by law. Vacancies in the
membership of the Committee shall be filled by the Board of
IV-13
<PAGE>
Directors at a regular or special meeting of the Board of
Directors. The Executive Committee shall keep regular Minutes of
its proceedings and report the same to the Board when required. A
majority of the Committee shall be necessary to constitute a
quorum, and in every case the vote of the majority of the members
present shall be necessary for the passage of any resolution.
Section 8. Other Committees. The Board of Directors may
appoint any other committees, standing or special, from time to
time, from among its own members or otherwise confer powers on such
committees and revoke such powers and terminate the existence of
such committees at pleasure. Each such committee shall keep Minutes
of its proceedings and report same to the Board when required.
ARTICLE V
Notices
Section 1. Giving of Notice. Whenever, under the provision of
the law or of the Certificate of Incorporation or of these By-Laws,
notice is required to be given to any Director or stockholder, it
shall not be construed to mean personal notice, but such notice may
be given in writing, by mail, addressed to such Director or
stockholder at his address as it appears on the records of the
Corporation, with postage thereon prepaid, and such notice shall be
deemed to be given at the time when the same shall be deposited in
the United States mail. Notice to Directors may also be given by
telegram.
Section 2. Waiver. Whenever any notice whatever is required
to be given under the provisions of the statutes or under the
provisions of the Certificate of Incorporation or of these By-Laws,
a waiver thereof in writing signed by the person or persons
entitled to such notice, whether before or after the time stated
therein, shall be deemed equivalent to the giving of such notice.
ARTICLE VI
Officers
Section 1. Election of Officers. The officers of the
Corporation shall be a Chairman of the Board; a Chief Executive
Officer; a President; a Chief Operating Officer; a Chief Financial
Officer; one or more Executive Vice Presidents; one or more Vice
Presidents; a Secretary and a Treasurer. The Corporation may also
have, at the discretion of the Board, one or more Assistant
Secretaries, one or more Assistant Treasurers, and such other
officers, agents and employees as it shall deem necessary. Any two
(2) of the aforesaid offices may be held by the same person. Every
officer shall perform such duties as the Board of Directors may
from time to time designate.
IV-14
<PAGE>
The Directors, immediately after each annual meeting of
stockholders, shall appoint from their number a Chairman of the
Board, a Chief Executive Officer, and a President. At such meeting
the Directors shall also choose one or more Vice Presidents, a
Secretary and a Treasurer, none of whom need be a member of the
Board.
The Board of Directors may appoint such other officers and
agents as it shall deem necessary, who shall hold their offices for
such terms and shall exercise such powers and perform such duties
as shall be determined from time to time by the Board of Directors.
Section 2. Compensation. The salaries of all officers of the
Corporation earning more than $100,000 shall be fixed by the Board
of Directors.
Section 3. Term and Removal. The officers of the Corporation
shall hold office for one (1) year and until their successors are
chosen and qualified in their stead. Any officer elected or
appointed by the Board of Directors may be removed at any time by
the affirmative vote of a majority of the Directors. If the office
of any officer becomes vacant for any reason, the vacancy shall be
filed by the Board of Directors.
Section 4. Chairman of the Board. The Chairman of the Board
shall be an Officer of the Corporation and shall preside at all
meetings of the Board of Directors and stockholders. He shall
assist the Board of Directors and other officers in the formulation
of the policies of the Corporation and shall be available to other
officers for consultation and advice. He shall have such other
powers and duties as may be from time to time prescribed by the
Board of Directors.
Section 5. Chief Executive Officer. The Chief Executive
Officer shall be either the Chairman of the Board or the President
as designated by the Board of Directors. Under the direction of the
Board of Directors, he shall have responsibility for the general
direction of the Corporation's business, policies and affairs. The
Chief Executive Officer shall be empowered at any time and from
time to time to issue and promulgate rules, regulations and
directives relating to the conduct and the business and affairs of
the Corporation. The Chief Executive Officer may hold such other
offices of the Corporation as shall be designated by the Board of
Directors. In the absence or disability of the Chairman of the
Board, he shall preside over meetings of the Board of Directors and
shareholders.
Section 6. President. The President shall be an officer and
shall perform such duties as assigned to him by the Board of
Directors or Chairman of the Board. Subject to the above, he shall
IV-15
<PAGE>
have the general powers and duties of management usually vested in
the office of President of the Corporation and shall have such
other powers and duties as may be prescribed by the Board of
Directors or the By-Laws.
Section 7. Chief Operating Officer. The Chief Operating
Officer shall be an officer and shall have the responsibility for
the active executive management and direction of the operating
divisions of the Corporation, subject to the overall direction of
the Chief Executive Officer and to the control of the Board of
Directors and the Executive Committee. He shall have such
additional powers and duties as the Chief Executive Officer or the
Board of Directors may from time to time assign to him.
Section 8. Chief Financial Officer. The Chief Financial
Officer shall be an officer, elected and designated by the Board of
Directors as Chief Financial Officer, who shall be responsible:
(a) for the receipt, custody and disbursement of all funds and
securities of the Corporation; (b) to receive and give receipts for
monies due and payable to the Corporation from any source
whatsoever and deposit all such monies in the name of the
Corporation in such banks, trust companies or other depositories as
shall from time to time be selected; (c) to disburse the funds of
the Corporation as ordered by the Chief Executive Officer or as
required in the ordinary conduct of the business of the
Corporation; (d) to render to the Chief Executive Officer or the
Board of Directors, upon request, an account of all transactions
and on the financial condition of the Corporation; and (e) in
general, to perform all the duties incident to the office of Chief
Financial Officer and such other duties as from time to time may be
assigned by the Chief Executive Officer, or the Board of Directors.
Section 9. Executive Vice President. The Corporation may have
one or more Executive Vice Presidents. Such Executive Vice
Presidents shall, under the direction of the President, exercise
general supervision over those functions of the Corporation
designated to such Executive Vice President. He may act for the
President in other ways as specifically directed by the President.
In the absence of the President, an Executive Vice President so
designated shall have and exercise all powers and duties of the
President and perform such other duties as may be prescribed by the
Board of Directors.
Section 10. Vice President. The Vice President, or if there
shall be more than one (1), shall have such powers and perform such
duties as may be assigned by the President or Board of Directors.
Vice Presidents may be so designated by seniority and by function.
IV-16
<PAGE>
Section 11. Secretary. The Secretary shall attend all
meetings of the Board of Directors and of the stockholders, and
shall record all votes and the Minutes of all proceedings in a book
to be kept for that purpose. The Secretary shall give or cause to
be given notice of all meetings of the stockholders and the Board
of Directors and shall affix the seal of the Corporation to all
certificates of stock, and to such other documents as may require
it, and shall have charge of the Corporation's seal, and the stock
certificate book, and such other books and papers as the Board of
Directors may direct, and shall cancel all surrendered stock
certificates before issuing new certificates, and shall preserve
such cancelled certificates. The Secretary shall also perform such
other duties as the Board of Directors may from time to time
prescribe.
Section 12. Assistant Secretary. An Assistant Secretary shall
have and exercise all the powers and duties of the Secretary in
case of the Secretary's absence or inability to act and shall have
such other powers and perform such other duties as may be assigned
to the Secretary by the Board of Directors.
Section 13. Treasurer. The Treasurer shall have the custody
of the Corporate funds and securities and shall deposit all monies
and other valuable effects in the name and to credit of the
Corporation in such depositories as may be authorized by the Board
of Directors. The Treasurer shall disburse the funds of the
Corporation as may be ordered by the Board, taking proper vouchers
for such disbursements and shall render to the Corporation an
account of all transactions and of the financial condition of the
Corporation. The Treasurer shall perform such other duties and have
such other powers as the Board, the Chief Executive Officer, the
Chief Financial Officer, or the officer to whom he shall report may
from time to time prescribe.
Section 14. Assistant Treasurer. As Assistant Treasurer shall
have and exercise all the powers and duties of the Treasurer in
case of the Treasurer's absence or inability to act and shall have
such other powers and perform such other duties as may be assigned
by the Board of Directors.
Section 15. Controller. The Controller shall be the chief
accounting officer of the Corporation and shall keep or cause to be
kept correct records of the business and transactions of the
Corporation and shall, upon request, at all reasonable times
exhibit or cause to be exhibited such records at the place where
such records are kept. He shall perform such other duties as from
time to time may be assigned to him by the Chief Executive Officer,
the President, the Chief Financial Officer or the officer to whom
he shall report.
IV-17
<PAGE>
Section 16. General Counsel. The General Counsel shall be the
chief legal officer of the Corporation and shall have, subject to
the control of the Board of Directors and the Chief Executive
Officer, general and active supervision and direction over the
legal affairs of the Corporation. He shall have such other powers
and perform such other duties as may be assigned to him by the
Board of Directors, the Chief Executive Officer, or the officer to
whom he shall report.
ARTICLE VII
Certificates of Stock
Section 1. Form. The certificates of stock of the Corporation
shall be numbered and entered in the books of the Corporation as
they are issued. They shall exhibit the holder's name and the
number of shares and shall be signed by the Chairman of the Board
or the President or a Vice President and the Treasurer or an
Assistant Treasurer or the Secretary or an Assistant Secretary, and
shall bear the Corporate seal. Such seal may be a facsimile,
engraved or printed. Where certificates are manually signed by a
Transfer Agent or Registrar who is not an officer or employee of
the Corporation, all other signatures on the certificates may be
facsimile.
Section 2. Transfer of Stock. Upon surrender to the
Corporation or the Transfer Agent of the Corporation of a
certificate of stock duly endorsed or accompanied by proper
evidence of succession, assignment or authority to transfer, it
shall be the duty of the Corporation to issue a new certificate to
the person entitled thereto and cancel the old certificates; every
such transfer of stock shall be entered on the stock books of the
Corporation.
Section 3. The Corporation shall be entitled to treat the
holder of record of any share or shares of stock as the holder in
fact thereof, and, accordingly, shall not be bound to recognize any
equitable or other claims to or interest in such share on the part
of any other person whether or not it shall have express or other
notice thereof, except as expressly provided by the laws of New
Jersey.
ARTICLE VIII
General Provisions
Section 1. Stockholders' Record Date. Except as otherwise
provided in these By-Laws, in order that the Corporation may
determine the stockholders entitled to notice of or to vote at any
meeting of stockholders or any adjournment thereof, or entitled to
receive payment of any dividend or other distribution or allotment
of any rights, or entitled to exercise any rights in respect of any
IV-18
<PAGE>
change, conversion or exchange of stock or for the purpose of any
other lawful action, the Board of Directors may fix, in advance, a
record date, which shall not be more than sixty (60) nor less than
ten (10) days before the day of such meeting, nor more than
sixty (60) days prior to any other action. A determination of
stockholders of record entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of the
meeting; provided, however, that the Board of Directors may fix a
new record date for the adjourned meeting.
Section 2. Dividends. Dividends upon the capital stock of the
Corporation, subject to any provisions of the Certificate of
Incorporation relating thereto, may be declared by the Board of
Directors at any regular or special meeting, pursuant to law.
Before payment of any dividend, there may be set aside out of
the net profits of the Corporation available for dividends such sum
or sums as the Directors from time to time in their absolute
discretion think proper as a reserve fund to meet contingencies, or
for equalizing dividends, or for repairing or maintaining any
property of the Corporation, or for such other purpose as the
Directors shall think conducive to the interests of the
Corporation, and the Directors may modify or abolish any such
reserve in the manner in which it was created.
Section 3. Checks. All checks or demands for money and notes
of the Corporation shall be signed by such officer or officers or
such other person or persons as the Board of Directors may from
time to time designate.
Section 4. Fiscal Year. The fiscal year of the Corporation
shall be fixed by resolution of the Board of Directors.
ARTICLE IX
Amendments
These By-Laws may be altered, amended, or repealed or new
By-Laws may be adopted by the affirmative vote of a majority of the
Board of Directors at any regular or special meeting of the Board,
subject to any provisions in the Certificate of Incorporation or
the statutes, reserving to the stockholders the power to adopt,
amend, or repeal By-Laws, provided, however, that By-Laws made by
the Board may be altered or repealed and new By-Laws made by the
stockholders. The stockholders may prescribe that any By-Law made
by them shall not be altered or repealed by the Board.
IV-19
Exhibit 10z
AGREEMENT
AGREEMENT by and between C. R. BARD, INC., a New Jersey
corporation (the "Corporation"), and Guy J. Jordan (the
"Executive"), dated as of the 10th day of October, 1996.
WHEREAS, the Corporation, on behalf of itself and its
shareholders, wishes to assure that the Corporation will have the
continued dedication of the Executive, notwithstanding the
possibility, threat, or occurrence of a Change of Control (as
defined below) of the Corporation. The Board of Directors of the
Corporation (the "Board") believes it is imperative to diminish the
inevitable distraction of the Executive by virtue of the personal
uncertainties and risks created by a pending or threatened Change
of Control, to encourage his attention and dedication to his
assigned duties currently and in the event of any threatened or
pending Change of Control, and to provide the Executive with
competitive compensation arrangements; therefore, the Board has
caused the Corporation to enter into this Agreement (i) to ensure
the Executive of individual financial security in the event of a
Change of Control, and (ii) to provide such protection in a manner
which is competitive with that of other corporations.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Certain Definitions. (a) The "Effective Date"
shall be the first date during the "Change of Control Period" (as
defined in Section l(b)) on which a Change of Control occurs.
Anything in this Agreement to the contrary notwithstanding, if the
Executive's employment with the Corporation is terminated prior to
the date on which a Change of Control occurs, and the Executive can
reasonably demonstrate that such termination (1) was at the request
of a third party who has taken steps reasonably calculated to
effect a Change of Control or (2) otherwise arose in connection
with or anticipation of a Change of Control, then for all purposes
of this Agreement the "Effective Date" shall mean the date
immediately prior to the date of such termination.
(b) The "Change of Control Period" is the period
commencing on the date hereof and ending on the earlier to occur of
(i) the third anniversary of such date or (ii) the first day of the
month next following the Executive's normal retirement date
IV-20
<PAGE>
("Normal Retirement Date") under the Corporation's retirement plan;
provided, however, that commencing on the date one year after the
date hereof, and on each annual anniversary of such date (such date
and each annual anniversary thereof is hereinafter referred to as
the "Renewal Date"), the Change of Control Period shall be auto-
matically extended so as to terminate on the earlier of (x) two
years from such Renewal Date or (y) the first day of the month
coinciding with or next following the Executive's Normal Retirement
Date, unless at least 60 days prior to the Renewal Date the
Corporation shall give notice that the Change of Control Period
shall not be so extended.
2. Change of Control. (a) For purposes of this
Agreement, a "Change of Control" shall be deemed to have occurred
if a change of control of the nature that would be required to be
reported in response to Item 1(a) of the Current Report on Form 8-K
as in effect on the date hereof pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934 (the "Exchange Act") occurs,
provided that, without limitation, a "Change of Control" shall be
deemed to have occurred if (i) the beneficial ownership at any time
hereafter by any person, as defined herein, of capital stock of the
Corporation, constitutes 20 percent or more of the general voting
power of all of the Corporation's outstanding capital or (ii)
individuals who, as of the date hereof, constitute the Board (as of
the date hereof, the "Incumbent Board") cease for any reason to
constitute at least a majority of the Board, provided that any
person becoming a Director subsequent to the date hereof whose
election, or nomination for election by the Corporation's
shareholders, was approved by a vote of at least three-quarters of
the Directors comprising the Incumbent Board (other than an
election or nomination of an individual whose initial assumption of
office is in connection with an actual or threatened election
contest relating to the election of the Directors of the
Corporation, as such terms are used in Rule 14a-11 of Regulation
14A promulgated under the Exchange Act) shall be, for purposes of
this Agreement, considered as though such person were a member of
the Incumbent Board. No sale to underwriters or private placement
of its capital stock by the Corporation, nor any acquisition
initiated by the Corporation, through merger, purchase of assets or
IV-21
<PAGE>
otherwise, effected in whole or in part by issuance or reissuance
of shares of its capital stock, shall constitute a Change of
Control.
(b) For purposes of the definition of "Change of
Control", the following definitions shall be applicable:
(i) The term "person" shall mean any individual,
corporation or other entity and any group as such term is used
in Section 13(d)(3) or 14(d)(2) of the Exchange Act.
(ii) Any person shall be deemed to be the beneficial
owner of any shares of capital stock of the Corporation:
A. which that person owns directly, whether or not
of record, or
B. which that person has the right to acquire
pursuant to any agreement or understanding or upon
exercise of conversion rights, warrants, or options, or
otherwise, or
C. which are beneficially owned, directly or
indirectly (including shares deemed owned through
application of clause (B) above), by an "affiliate" or
"associate" (as defined in the rules of the Securities
and Exchange Commission under the Securities Act of 1933,
as amended) of that person, or
D. which are beneficially owned, directly or
indirectly (including shares deemed owned through
application of clause (B) above), by any other person
with which that person or his "affiliate" or "associate"
(defined as aforesaid) has any agreement, arrangement or
understanding for the purpose of acquiring, holding,
voting or disposing of capital stock of the Corporation.
(iii) The outstanding shares of capital stock of the
Corporation shall include shares deemed owned through
IV-22
<PAGE>
application of clauses (ii) (B), (C) and (D), above, but shall not
include any other shares which may be issuable pursuant to any
agreement or upon exercise of conversion rights, warrants or
options, or otherwise, but which are not actually outstanding.
(iv) Shares of capital stock, if any, held by The Chase
Manhattan Bank N.A. under the Indenture and the Escrow
Agreement dated as of November 1, 1971 between International
Paper Corporation and said bank shall not be deemed owned by
International Paper Corporation or by said bank for purposes
of this definition, so long as they are held by said bank
under said Escrow Agreement, but said shares shall be deemed
outstanding for the purpose of determining the aggregate
number of outstanding shares of capital stock of the
Corporation.
3. Employment Period. The Corporation hereby agrees to
continue the Executive in its employ, and the Executive hereby
agrees to remain in the employ of the Corporation, for the period
commencing on the Effective Date and ending on the earlier to occur
of (a) the third anniversary of such date or (b) the first day of
the month coinciding with or next following the Executive's Normal
Retirement Date (the "Employment Period").
4. Terms of Employment. (a) Position and Duties. (i)
During the Employment Period, (A) the Executive's position
(including status, offices, titles and reporting requirements),
authority, duties and responsibilities shall be at least
commensurate in all material respects with the most significant of
those held, exercised and assigned at any time during the 90-day
period immediately preceding the Effective Date and (B) the
Executive's services shall be performed at the location where the
Executive was employed immediately preceding the Effective Date or
any office or location less than thirty-five (35) miles from such
location.
(ii) During the Employment Period, and excluding
any periods of vacation and sick leave to which the Executive is
entitled, the Executive agrees to devote reasonable attention and
time during normal business hours to the business and affairs of
IV-23
<PAGE>
the Corporation and, to the extent necessary to discharge the
responsibilities assigned to the Executive hereunder, to use the
Executive's reasonable best efforts to perform faithfully and
efficiently such responsibilities. During the Employment Period it
shall not be a violation of this Agreement for the Executive to (A)
serve on corporate, civic or charitable boards or committees, (B)
deliver lectures, fulfill speaking engagements or teach at
educational institutions and (C) manage personal investments, so
long as such activities do not significantly interfere with the
performance of the Executive's responsibilities as an employee of
the Corporation in accordance with this Agreement. It is expressly
understood and agreed that to the extent that any such activities
have been conducted by the Executive prior to the Effective Date,
the continued conduct of such activities (or the conduct of
activities similar in nature and scope thereto) subsequent to the
Effective Date shall not thereafter be deemed to interfere with the
performance of the Executive's responsibilities to the Corporation.
(b) Compensation. (i) Base Salary. During the
Employment Period, the Executive shall receive a base salary ("Base
Salary") at a monthly rate at least equal to the highest monthly
base salary paid to the Executive by the Corporation during the
twelve-month period immediately preceding the month in which the
Effective Date occurs. During the Employment Period, the Base
Salary shall be reviewed at least annually and shall be increased
at any time and from time to time as shall be consistent with
increases in base salary awarded in the ordinary course of business
to other key executives of the Corporation. Any increase in Base
Salary shall not serve to limit or reduce any other obligation to
the Executive under this Agreement. Base Salary shall not be
reduced after any such increase.
(ii) Annual Bonus. In addition to Ease Salary, the
Executive shall be awarded, for each fiscal year during the
Employment Period, an annual bonus (an "Annual Bonus") in cash at
least equal to the average bonus received by the Executive from the
Corporation in respect of the three fiscal years immediately
preceding the fiscal year in which the Effective Date occurs.
IV-24
<PAGE>
(iii) Incentive, Savings and Retirement Plans. In
addition to Base Salary and Annual Bonus payable as hereinabove
provided, the Executive shall be entitled to participate during the
Employment Period in all incentive, savings and retirement plans
and programs, whether qualified or non-qualified, then applicable
to other key executives of the Corporation and its affiliates
(including the Corporation's 1981 Stock Option Plan, the Long-Term
Performance Incentive Plan, the 1986 Stock Award Plan, the 1981
Employee Stock Appreciation Rights Plan, the Employees' Stock
Ownership Plan and the Employees' Retirement Savings Plan, in each
case to the extent then in effect or as subsequently amended);
provided, however, that such plans and programs, in the aggregate,
shall provide the Executive with compensation, benefits and reward
opportunities at least as favorable as the most favorable such
compensation benefits and reward opportunities provided by the
Corporation for the Executive under such plans and programs as in
effect at any time during the 90-day period immediately preceding
the Effective Date or, if more favorable to the Executive, as
provided at any time thereafter with respect to other key
executives.
(iv) Welfare Benefit Plans. During the Employment
Period, the Executive and/or the Executive's family, as the case
may be, shall be eligible for participation in and shall receive
all benefits under welfare benefit plans provided by the
Corporation (including, without limitation, medical, prescription,
dental, disability, salary continuance, executive life, group life,
accidental death and travel accident insurance plans and programs),
at least comparable to those in effect at any time during the
90-day period immediately preceding the Effective Date which would
be most favorable to the Executive or, if more favorable to the
Executive, as in effect at any time thereafter with respect to
other key executives.
(v) Expenses. During the Employment Period, the
Executive shall be entitled to receive prompt reimbursement for all
reasonable expenses incurred by the Executive in accordance with
the most favorable policies and procedures of the Corporation and
its affiliates in effect at any time during the 90-day period
IV-25
<PAGE>
immediately preceding the Effective Date or, if more favorable to
the Executive, as in effect at any time thereafter with respect to
other key executives.
(vi) Fringe Benefits. During the Employment
Period, the Executive shall be entitled to fringe benefits, in
accordance with the most favorable policies of the Corporation and
its affiliates in effect at any time during the 90-day period
immediately preceding the Effective Date or, if more favorable to
the Executive, as in effect at any time thereafter with respect to
other key executives.
(vii) Office and Support Staff. During the
Employment Period, the Executive shall be entitled to an office or
offices of a size and with furnishings and other appointments, and
to secretarial and other assistance, at least equal to those
provided to the Executive at any time during the 90-day period
immediately preceding the Effective Date which would be most
favorable to the Executive or, if more favorable to the Executive,
as provided at any time thereafter with respect to other key
executives.
(viii) Vacation. During the Employment Period, the
Executive shall be entitled to paid vacation in accordance with the
most favorable policies of the Corporation and its affiliates as in
effect at any time during the 90-day period immediately preceding
the Effective Date or, if more favorable to the Executive, as in
effect at any time thereafter with respect to other key executives.
5. Termination. (a) Death or Disability. This
Agreement shall terminate automatically upon the Executive's death.
The Corporation may terminate this Agreement, after having
established the Executive's Disability (pursuant to the definition
of "Disability" set forth below), by giving to the Executive
written notice of its intention to terminate the Executive's
employment. In such a case, the Executive's employment with the
Corporation shall terminate effective on the 180th day after
receipt of such notice (the "Disability Effective Date"), provided
that, within 180 days after such receipt, the Executive shall not
have returned to full-time performance of the Executive's duties.
IV-26
<PAGE>
For purposes of this Agreement, "Disability" means disability
which, at least 26 weeks after its commencement, is determined to
be total and permanent by a physician selected by the Corporation
or its insurers and acceptable to the Executive or the Executive's
legal representative (such agreement as to acceptability not to be
withheld unreasonably).
(b) Cause. The Corporation may terminate the
Executive's employment for "Cause." For purposes of this Agreement,
"Cause" means (i) an act or acts of dishonesty taken by the
Executive and intended to result in substantial personal enrichment
of the Executive at the expense of the Corporation, (ii) repeated
violations by the Executive of the Executive's obligations under
Section 4(a) of this Agreement which are demonstrably willful and
deliberate on the Executive's part and which are not remedied after
the receipt of notice from the Corporation or (iii) the conviction
of the Executive of a felony.
(c) Termination by Executive for Good Reason. The
Executive's employment may be terminated by the Executive for Good
Reason. For purposes of this Agreement, "Good Reason" means
(i) (A) the assignment to the Executive of any duties
inconsistent in any respect with the Executive's position
(including status, offices, titles and reporting
requirements), authority, duties or responsibilities as
contemplated by Section 4(a) of this Agreement, or (B) any
other action by the Corporation which results in a diminution
in such position, authority, duties or responsibilities, other
than an insubstantial and inadvertent action which is remedied
by the Corporation promptly after receipt of notice thereof
given by the Executive;
(ii) any failure by the Corporation to comply with any
of the provisions of Section 4(b) of this Agreement, other
than an insubstantial and inadvertent failure which is
remedied by the Corporation promptly after receipt of notice
thereof given by the Executive;
IV-27
<PAGE>
(iii) the Corporation's requiring the Executive to be
based at any office or location other than that described in
Section 4(a)(i)(B) hereof, except for travel reasonably
required in the performance of the Executive's
responsibilities;
(iv) any purported termination by the Corporation of
the Executive's employment otherwise than as permitted by this
Agreement; or
(v) any failure by the Corporation to comply with and
satisfy Section 11(c) of this Agreement.
Anything in this Agreement to the contrary
notwithstanding, any termination by the Executive for any reason
whatsoever during the six month period immediately following the
first anniversary of the date of a Change of Control shall be a
termination for "Good Reason". For purposes of this Section 5(c),
any good faith determination of "Good Reason" made by the Executive
shall be conclusive.
(d) Notice of Termination. Any termination by the
Corporation for Cause or by the Executive for Good Reason shall be
communicated by Notice of Termination to the other party hereto
given in accordance with Section 12(b) of this Agreement. For
purposes of this Agreement, a "Notice of Termination" means a
written notice which (i) indicates the specific termination
provision in this Agreement relied upon, (ii) sets forth in
reasonable detail the facts and circumstances claimed to provide a
basis for termination of the Executive's employment under the
provision so indicated and (iii) if the termination date is other
than the date of receipt of such notice, specifies the termination
date (which date shall be not more than fifteen (15) days after the
giving of such notice).
IV-28
<PAGE>
(e) Date of Termination. "Date of Termination" means
the date of receipt of the Notice of Termination or any later date
specified therein, as the case may be. If the Executive's
employment is terminated by the Corporation other than for Cause or
Disability, the Date of Termination shall be the date on which the
Corporation notifies the Executive of such termination.
6. Obligations of the Corporation upon Termination. (a)
Death. If the Executive's employment is terminated by reason of
the Executive's death, this Agreement shall terminate without
further obligations to the Executive's legal representatives under
this Agreement, other than those obligations accrued or earned by
the Executive hereunder at the date of the Executive's death.
Anything in this Agreement to the contrary notwithstanding, the
Executive's family shall be entitled to receive benefits at least
equal to the most favorable benefits provided by the Corporation to
surviving families of executives of the Corporation under such
plans, programs and policies relating to family death benefits, if
any, as in effect at any time during the 90-day period immediately
preceding the Effective Date or, if more favorable to the Executive
and/or the Executive's family, as in effect on the date of the
Executive's death with respect to other key executives and their
families.
(b) Disability. If the Executive's employment is
terminated by reason of the Executive's Disability, this Agreement
shall terminate without further obligations to the Executive, other
than those obligations accrued or earned by the Executive hereunder
as of the Disability Effective Date. Anything in this Agreement to
the contrary notwithstanding, the Executive shall be entitled after
the Disability Effective Date to receive disability and other
benefits at least equal to the most favorable of those provided by
the Corporation to disabled employees and/or their families in
accordance with such plans, programs and policies relating to
disability, if any, as in effect at any time during the 90-day
period immediately preceding the Effective Date or, if more
favorable to the Executive and/or the Executive's family, as in
effect at any time thereafter with respect to other key executives
and their families.
IV-29
<PAGE>
(c) Cause; Other than for Good Reason. If the
Executive's employment shall be terminated for Cause or the
Executive terminates his employment other than for Good Reason, the
Corporation shall pay the Executive his full Base Salary through
the Date of Termination at the rate in effect at the time Notice of
Termination is given and shall have no further obligations to the
Executive under this Agreement.
(d) Termination by Executive for Good Reason;
Termination by Corporation Other Than for Cause or Disability. If,
during the Employment Period, the Corporation shall terminate the
Executive's employment other than for Cause or Disability, or the
employment of the Executive shall be terminated by the Executive
for Good Reason:
(i) the Corporation shall pay to the Executive in a
lump sum in cash within 10 days after the Date of Termination
(the "Payment Date") the aggregate of the following amounts:
A. to the extent not theretofore paid, the
Executive's Base Salary through the Date of Termination
at the rate in effect on the Date of Termination or, if
higher, at the highest rate in effect at any time within
the three year period preceding the Effective Date (the
"Highest Base Salary"); and
B. the product of (x) the average of the annual
bonuses paid, or payable to the extent deferred, to the
Executive for the three full fiscal years prior to the
Effective Date (the "Recent Bonus") and (y) the fraction
obtained by dividing (i) the number of days between the
Date of Termination and the last day of the last full
fiscal year and (ii) 365; and
C. the product of (x) three and (y) the sum of the
Highest Base Salary and (ii) the Recent Bonus; and
D. in the case of compensation previously deferred
by the Executive, all amounts previously deferred and not
yet paid by the Corporation; and
IV-30
<PAGE>
(ii) for one year after the Date of Termination, the
Corporation shall continue benefits to the Executive and/or
the Executive's family at least equal to those which would
have been provided to them in accordance with the plans,
programs and policies described in Section 4(b)(iv) of this
Agreement if the Executive's employment had not been
terminated, including health insurance and life insurance, if
and as in effect at any time during the 90-day period
immediately preceding the Effective Date or, if more favorable
to the Executive, as in effect at any time thereafter with
respect to other key executives and their families and for
purposes of eligibility for retiree benefits pursuant to such
plans, programs and policies, the Executive shall be
considered to have remained employed until the end of the
Employment Period and to have retired on the last day of such
period.
Anything herein to the contrary notwithstanding, the
Executive may elect in his Notice of Termination to receive the
payment provided for pursuant to Section 6(d)(i)(C) hereof (the
"Severance Payment") in installments. If the Executive elects the
installment method, one-quarter of the Severance Payment shall be
paid to the Executive on the Payment Date and one-quarter of the
severance payment shall be paid to the Executive on each of the
next three anniversaries thereof and, in the case of the latter
three payments, the amounts to be paid shall include interests from
the Payment Date on the remaining unpaid balance of the Severance
Payment calculated at the Morgan Guaranty Trust Company prime rate
as in effect from time to time.
7. Non-exclusivity of Rights. Nothing in this
Agreement shall prevent or limit the Executive's continuing or
future participation in any benefit, bonus, incentive or other plan
or program provided by the Corporation or any of its affiliated
companies and for which the Executive may qualify, nor shall
anything herein limit or otherwise affect such rights as the
Executive may have under any stock option or other agreements with
the Corporation or any of its affiliated companies. Amounts which
are vested benefits or which the Executive is otherwise entitled to
IV-31
<PAGE>
receive under any plan or program of the Corporation or any of its
affiliated companies at or subsequent to the Date of Termination
shall be payable in accordance with such plan or program.
8. Full Settlement. The Corporation's obligation to
make the payments provided for in this Agreement and otherwise to
perform its obligations hereunder shall not be affected by any
set-off, counterclaim, recoupment, defense or other claim, right or
action which the Corporation may have against the Executive or
others. In no event shall the Executive be obligated to seek other
employment or take any other action by way of mitigation of the
amounts payable to the Executive under any of the provisions of
this Agreement. The Corporation agrees to pay, to the full extent
permitted by law, all legal fees and expenses which the Executive
may reasonably incur as a result of any contest (regardless of the
outcome thereof) by the Corporation or others of the validity or
enforceability of, or liability under, any provision of this
Agreement or any guarantee of performance thereof or as a result of
any contest by the Executive about the amount of any payment
pursuant to Section 9 of this Agreement, plus in each case interest
at the Federal Rate (as defined below).
9. Gross-up.
(a) In the event it shall be determined that any
payment, benefit or distribution (or combination thereof) by the
Corporation to or for the benefit of Executive (whether paid or
payable or distributed or distributable pursuant to the terms of
this Agreement, or otherwise) (a "Payment") would be subject to the
excise tax imposed by Section 4999 of the Internal Revenue Code of
1986, as amended (the "Code"), or any interest or penalties are
incurred by Executive with respect to such excise tax (such excise
tax, together with any such interest and penalties, hereinafter
collectively referred to as the "Excise Tax"), Executive shall be
entitled to receive an additional payment (a "Gross-Up Payment") in
an amount such that after payment by Executive of the Excise Tax
imposed upon the Gross-Up Payment, Executive retains an amount of
the Gross-Up Payment equal to the Excise Tax imposed upon the
Payments.
IV-32
<PAGE>
(b) Subject to the provisions of Section 9(c), all
determinations required to be made under this Section 9, including
whether and when a Gross-Up Payment is required and the amount of
such Gross-Up Payment and the assumptions to be utilized in
arriving at such determination, shall be made by Arthur Andersen &
Co. (the "Accounting Firm") which shall provide detailed supporting
calculations both to the Corporation and Executive within fifteen
(15) business days of the receipt of notice from Executive that
there has been a Payment, or such earlier time as is requested by
the Corporation. In the event that the Accounting Firm is serving
as accountant or auditor for an individual, entity or group
effecting the change in ownership or effective control (within the
meaning of Section 280G of the Code), Executive shall appoint
another nationally recognized accounting firm to make the
determinations required hereunder (which accounting firm shall then
be referred to as the Accounting Firm hereunder). All fees and
expenses of the Accounting Firm shall be borne solely by the
Corporation. Any Gross-Up Payment, as determined pursuant to this
Section 9, shall be paid by the Corporation to Executive within
five (5) days after the receipt of the Accounting Firm's
determination. If the Accounting Firm determines that no Excise
Tax is payable by Executive, it shall so indicate to Executive in
writing. Any determination by the Accounting Firm shall be binding
upon the Corporation and Executive. As a result of the uncertainty
in the application of Section 4999 of the Code at the time of the
initial determination by the Accounting Firm hereunder, it is
possible that Gross-Up Payments which will not have been made by
the Corporation should have been made ("Underpayment"), consistent
with the calculations required to be made hereunder. In the event
that the Corporation exhausts its remedies pursuant to Section 9(c)
and Executive thereafter is required to make a payment of any
Excise Tax, the Accounting Firm shall determine the amount of the
Underpayment that has occurred and any such Underpayment shall be
promptly paid by the Corporation to or for the benefit of
Executive.
(c) Executive shall notify the Corporation in writing of
any claim by the Internal Revenue Service that, if successful,
would require the payment by the Corporation of the Gross-Up
Payment. Such notification shall be given as soon as practicable
IV-33
<PAGE>
but no later than ten (10) business days after Executive is
informed in writing of such claim and shall apprise the Corporation
of the nature of such claim and the date on which such claim is
requested to be paid. Executive shall not pay such claim prior to
the expiration of the thirty (30) day period following the date on
which it gives such notice to the Corporation (or such shorter
period ending on the date that any payment of taxes with respect to
such claim is due). If the Corporation notifies Executive in
writing prior to the expiration of such period that it desires to
contest such claim, Executive shall:
(i) give the Corporation any information reasonably
requested by the Corporation relating to such claim;
(ii) take such action in connection with contesting such
claim as the Corporation shall reasonably request in writing from
time to time, including, without limitation, accepting legal
representation with respect to such claim by an attorney reasonably
selected by the Corporation;
(iii) cooperate with the Corporation in good faith in
order to effectively contest such claim; and
(iv) permit the Corporation to participate in any
proceedings relating to such claim;
provided, however, that the Corporation shall bear and pay directly
all costs and expenses (including additional interest and
penalties) incurred in connection with such contest and shall
indemnify and hold Executive harmless, on an after-tax basis, for
any Excise Tax (including interest and penalties with respect
thereto) imposed as a result of such representation and payment of
costs and expenses. Without limitation on the foregoing provisions
of this Section 9(c), the Corporation shall control all proceedings
taken in connection with such contest and, at its sole option, may
pursue or forego any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in respect of
such claim and may, at its sole option, either direct Executive to
pay the tax claimed and sue for a refund or contest the claim in
any permissible manner, and Executive agrees to prosecute such
contest to a determination before any administrative tribunal, in
IV-34
<PAGE>
a court of initial jurisdiction and in one or more appellate
courts, as the Corporation shall determine; provided, however, that
if the Corporation directs Executive to pay such claim and sue for
a refund, the Corporation shall advance the amount of such payment
to Executive, on an interest-free basis, and shall indemnify and
hold Executive harmless, on an after-tax basis, from any Excise Tax
(including interest or penalties with respect thereto) imposed with
respect to such advance or with respect to any imputed income with
respect to such advance; and provided, further, that if Executive
is required to extend the statute of limitations to enable the
Corporation to contest such claim, Executive may limit this
extension solely to such contested amount.
(d) If, after the receipt by Executive of an amount
advanced by the Corporation pursuant to Section 9(c), Executive
becomes entitled to receive any refund with respect to such claim,
Executive shall (subject to the Corporation's complying with the
requirements of Section 9(c)) promptly pay to the Corporation the
amount of such refund (together with any interest paid or credited
thereon after taxes applicable thereto). If, after the receipt by
Executive of an amount advanced by the Corporation pursuant to
Section 9(c), a determination is made that Executive shall not be
entitled to any refund with respect to such claim and the
Corporation does not notify Executive in writing of its intent to
contest such denial of refund prior to the expiration of thirty
(30) days after such determination, then such advance shall be
forgiven and shall not be required to be repaid and the amount of
such advance shall offset, to the extent thereof, the amount of
Gross-Up Payment required to be paid.
10. Confidential Information. The Executive shall hold
in a fiduciary capacity for the benefit of the Corporation all
secret or confidential information, knowledge or data relating to
the Corporation or any of its affiliated companies, and their
respective businesses, which shall have been obtained by the
Executive during the Executive's employment by the Corporation or
any of its affiliated companies and which shall not be public
knowledge (other than by acts by the Executive or his
representatives in violation of this Agreement). After termination
of the Executive's employment with the Corporation, the Executive
shall not, without the prior written consent of the Corporation,
IV-35
<PAGE>
communicate or divulge any such information, knowledge or data to
anyone other than the Corporation and those designated by it. In
no event shall an asserted violation of the provisions of this
Section 10 constitute a basis for deferring or withholding any
amounts otherwise payable to the Executive under this Agreement.
11. Successors. (a) This Agreement is personal to the
Executive and without the prior written consent of the Corporation
shall not be assignable by the Executive otherwise than by will or
the laws of descent and distribution. This Agreement shall inure
to the benefit of and be enforceable by the Executive's legal
representatives.
(b) This Agreement shall inure to the benefit of and be
binding upon the Corporation and its successors.
(c) The Corporation will require any successor (whether
direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or
assets of the Corporation to expressly assume and agree to perform
this Agreement in the same manner and to the same extent that the
Corporation would be required to perform it if no such succession
had taken place. As used in this Agreement, "Corporation" shall
mean the Corporation as hereinbefore defined and any successor to
its business and/or assets as aforesaid which assumes and agrees to
perform this Agreement by operation of law, or otherwise.
12. Miscellaneous. (a) This Agreement shall be
governed by and construed in accordance with the laws of the State
of New Jersey, without reference to principles of conflict of laws.
The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect. This Agreement may not
be amended or modified otherwise than by a written agreement
executed by the parties hereto or their respective successors and
legal representatives.
(b) All notices and other communications hereunder shall
be in writing and shall be given by hand delivery to the other
party or by registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:
IV-36
<PAGE>
If to the Executive:
Guy J. Jordan
9020 South Blackjack Road #D
P.O. Box 8091
Alta, UT 84124
If to the Corporation:
C. R. BARD, INC.
730 Central Avenue
Murray Hill, New Jersey 07974
Attention: General Counsel
or to such other address as either party shall have furnished to
the other in writing in accordance herewith. Notice and
communications shall be effective when actually received by the
addressee.
(c) The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability
of any other provision of this Agreement.
(d) The Corporation may withhold from any amounts
payable under this Agreement such Federal, state or local taxes as
shall be required to be withheld pursuant to any applicable law or
regulation.
(e) The Executive's failure to insist upon strict
compliance with any provision hereof shall not be deemed to be a
waiver of such provision or any other provision thereof.
(f) This Agreement contains the entire understanding of
the Corporation and the Executive with respect to the subject
matter hereof.
(g) The Executive and the Corporation acknowledge that
the employment of the Executive by the Corporation is "at will",
IV-37
<PAGE>
and, prior to the Effective Date, may be terminated by either the
Executive or the Corporation at any time. Upon a termination of
the Executive's employment or upon the Executive's ceasing to be an
officer of the Corporation, in each case, prior to the Effective
Date, there shall be no further rights under this Agreement.
IN WITNESS WHEREOF, the Executive has hereunto set his
hand and, pursuant to the authorization from its Board of
Directors, the Corporation has caused these presents to be executed
in its name on its behalf, all as of the day and year first above
written.
/s/ Guy J. Jordan
Guy J. Jordan
C. R. BARD, INC.
By:/s/ William H. Longfield
Name: William H. Longfield
Title: Chairman and
Chief Executive Officer
Attest:/s/ Jean F. Miller
Assistant Secretary
IV-38
Exhibit 10aa
AGREEMENT
AGREEMENT by and between C. R. BARD, INC., a New Jersey
corporation (the "Corporation"), and Charles P. Grom (the
"Executive"), dated as of the 11th day of December, 1996.
WHEREAS, the Corporation, on behalf of itself and its
shareholders, wishes to assure that the Corporation will have the
continued dedication of the Executive, notwithstanding the
possibility, threat, or occurrence of a Change of Control (as
defined below) of the Corporation. The Board of Directors of the
Corporation (the "Board") believes it is imperative to diminish the
inevitable distraction of the Executive by virtue of the personal
uncertainties and risks created by a pending or threatened Change
of Control, to encourage his attention and dedication to his
assigned duties currently and in the event of any threatened or
pending Change of Control, and to provide the Executive with
competitive compensation arrangements; therefore, the Board has
caused the Corporation to enter into this Agreement (i) to ensure
the Executive of individual financial security in the event of a
Change of Control, and (ii) to provide such protection in a manner
which is competitive with that of other corporations.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Certain Definitions. (a) The "Effective Date"
shall be the first date during the "Change of Control Period" (as
defined in Section l(b)) on which a Change of Control occurs.
Anything in this Agreement to the contrary notwithstanding, if the
Executive's employment with the Corporation is terminated prior to
the date on which a Change of Control occurs, and the Executive can
reasonably demonstrate that such termination (1) was at the request
of a third party who has taken steps reasonably calculated to
effect a Change of Control or (2) otherwise arose in connection
with or anticipation of a Change of Control, then for all purposes
of this Agreement the "Effective Date" shall mean the date
immediately prior to the date of such termination.
(b) The "Change of Control Period" is the period
commencing on the date hereof and ending on the earlier to occur of
(i) the third anniversary of such date or (ii) the first day of the
month next following the Executive's normal retirement date
IV-39
<PAGE>
"Normal Retirement Date") under the Corporation's retirement plan;
provided, however, that commencing on the date one year after the
date hereof, and on each annual anniversary of such date (such date
and each annual anniversary thereof is hereinafter referred to as
the "Renewal Date"), the Change of Control Period shall be auto-
matically extended so as to terminate on the earlier of (x) two
years from such Renewal Date or (y) the first day of the month
coinciding with or next following the Executive's Normal Retirement
Date, unless at least 60 days prior to the Renewal Date the
Corporation shall give notice that the Change of Control Period
shall not be so extended.
2. Change of Control. (a) For purposes of this
Agreement, a "Change of Control" shall be deemed to have occurred
if a change of control of the nature that would be required to be
reported in response to Item 1(a) of the Current Report on Form 8-K
as in effect on the date hereof pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934 (the "Exchange Act") occurs,
provided that, without limitation, a "Change of Control" shall be
deemed to have occurred if (i) the beneficial ownership at any time
hereafter by any person, as defined herein, of capital stock of the
Corporation, constitutes 20 percent or more of the general voting
power of all of the Corporation's outstanding capital or (ii)
individuals who, as of the date hereof, constitute the Board (as of
the date hereof, the "Incumbent Board") cease for any reason to
constitute at least a majority of the Board, provided that any
person becoming a Director subsequent to the date hereof whose
election, or nomination for election by the Corporation's
shareholders, was approved by a vote of at least three-quarters of
the Directors comprising the Incumbent Board (other than an
election or nomination of an individual whose initial assumption of
office is in connection with an actual or threatened election
contest relating to the election of the Directors of the
Corporation, as such terms are used in Rule 14a-11 of Regulation
14A promulgated under the Exchange Act) shall be, for purposes of
this Agreement, considered as though such person were a member of
the Incumbent Board. No sale to underwriters or private placement
of its capital stock by the Corporation, nor any acquisition
initiated by the Corporation, through merger, purchase of assets or
IV-40
<PAGE>
otherwise, effected in whole or in part by issuance or reissuance
of shares of its capital stock, shall constitute a Change of
Control.
(b) For purposes of the definition of "Change of
Control", the following definitions shall be applicable:
(i) The term "person" shall mean any individual,
corporation or other entity and any group as such term is used
in Section 13(d)(3) or 14(d)(2) of the Exchange Act.
(ii) Any person shall be deemed to be the beneficial
owner of any shares of capital stock of the Corporation:
A. which that person owns directly, whether or not
of record, or
B. which that person has the right to acquire
pursuant to any agreement or understanding or upon
exercise of conversion rights, warrants, or options, or
otherwise, or
C. which are beneficially owned, directly or
indirectly (including shares deemed owned through
application of clause (B) above), by an "affiliate" or
"associate" (as defined in the rules of the Securities
and Exchange Commission under the Securities Act of 1933,
as amended) of that person, or
D. which are beneficially owned, directly or
indirectly (including shares deemed owned through
application of clause (B) above), by any other person
with which that person or his "affiliate" or "associate"
(defined as aforesaid) has any agreement, arrangement or
understanding for the purpose of acquiring, holding,
voting or disposing of capital stock of the Corporation.
IV-41
<PAGE>
(iii) The outstanding shares of capital stock of the
Corporation shall include shares deemed owned through
application of clauses (ii) (B), (C) and (D), above, but shall
not include any other shares which may be issuable pursuant to
any agreement or upon exercise of conversion rights, warrants
or options, or otherwise, but which are not actually
outstanding.
(iv) Shares of capital stock, if any, held by The Chase
Manhattan Bank N.A. under the Indenture and the Escrow
Agreement dated as of November 1, 1971 between International
Paper Corporation and said bank shall not be deemed owned by
International Paper Corporation or by said bank for purposes
of this definition, so long as they are held by said bank
under said Escrow Agreement, but said shares shall be deemed
outstanding for the purpose of determining the aggregate
number of outstanding shares of capital stock of the
Corporation.
3. Employment Period. The Corporation hereby agrees to
continue the Executive in its employ, and the Executive hereby
agrees to remain in the employ of the Corporation, for the period
commencing on the Effective Date and ending on the earlier to occur
of (a) the third anniversary of such date or (b) the first day of
the month coinciding with or next following the Executive's Normal
Retirement Date (the "Employment Period").
4. Terms of Employment. (a) Position and Duties. (i)
During the Employment Period, (A) the Executive's position
(including status, offices, titles and reporting requirements),
authority, duties and responsibilities shall be at least
commensurate in all material respects with the most significant of
those held, exercised and assigned at any time during the 90-day
period immediately preceding the Effective Date and (B) the
Executive's services shall be performed at the location where the
Executive was employed immediately preceding the Effective Date or
any office or location less than thirty-five (35) miles from such
location.
IV-42
<PAGE>
(ii) During the Employment Period, and excluding
any periods of vacation and sick leave to which the Executive is
entitled, the Executive agrees to devote reasonable attention and
time during normal business hours to the business and affairs of
the Corporation and, to the extent necessary to discharge the
responsibilities assigned to the Executive hereunder, to use the
Executive's reasonable best efforts to perform faithfully and
efficiently such responsibilities. During the Employment Period it
shall not be a violation of this Agreement for the Executive to (A)
serve on corporate, civic or charitable boards or committees, (B)
deliver lectures, fulfill speaking engagements or teach at
educational institutions and (C) manage personal investments, so
long as such activities do not significantly interfere with the
performance of the Executive's responsibilities as an employee of
the Corporation in accordance with this Agreement. It is expressly
understood and agreed that to the extent that any such activities
have been conducted by the Executive prior to the Effective Date,
the continued conduct of such activities (or the conduct of
activities similar in nature and scope thereto) subsequent to the
Effective Date shall not thereafter be deemed to interfere with the
performance of the Executive's responsibilities to the Corporation.
(b) Compensation. (i) Base Salary. During the
Employment Period, the Executive shall receive a base salary ("Base
Salary") at a monthly rate at least equal to the highest monthly
base salary paid to the Executive by the Corporation during the
twelve-month period immediately preceding the month in which the
Effective Date occurs. During the Employment Period, the Base
Salary shall be reviewed at least annually and shall be increased
at any time and from time to time as shall be consistent with
increases in base salary awarded in the ordinary course of business
to other key executives of the Corporation. Any increase in Base
Salary shall not serve to limit or reduce any other obligation to
the Executive under this Agreement. Base Salary shall not be
reduced after any such increase.
IV-43
<PAGE>
(ii) Annual Bonus. In addition to Base Salary, the
Executive shall be awarded, for each fiscal year during the
Employment Period, an annual bonus (an "Annual Bonus") in cash at
least equal to the average bonus received by the Executive from the
Corporation in respect of the three fiscal years immediately
preceding the fiscal year in which the Effective Date occurs.
(iii) Incentive, Savings and Retirement Plans. In
addition to Base Salary and Annual Bonus payable as hereinabove
provided, the Executive shall be entitled to participate during the
Employment Period in all incentive, savings and retirement plans
and programs, whether qualified or non-qualified, then applicable
to other key executives of the Corporation and its affiliates
(including the Corporation's 1981 Stock Option Plan, the Long-Term
Performance Incentive Plan, the 1986 Stock Award Plan, the 1981
Employee Stock Appreciation Rights Plan, the Employees' Stock
Ownership Plan and the Employees' Retirement Savings Plan, in each
case to the extent then in effect or as subsequently amended);
provided, however, that such plans and programs, in the aggregate,
shall provide the Executive with compensation, benefits and reward
opportunities at least as favorable as the most favorable such
compensation benefits and reward opportunities provided by the
Corporation for the Executive under such plans and programs as in
effect at any time during the 90-day period immediately preceding
the Effective Date or, if more favorable to the Executive, as
provided at any time thereafter with respect to other key
executives.
(iv) Welfare Benefit Plans. During the Employment
Period, the Executive and/or the Executive's family, as the case
may be, shall be eligible for participation in and shall receive
all benefits under welfare benefit plans provided by the
Corporation (including, without limitation, medical, prescription,
dental, disability, salary continuance, executive life, group life,
accidental death and travel accident insurance plans and programs),
at least comparable to those in effect at any time during the
90-day period immediately preceding the Effective Date which would
be most favorable to the Executive or, if more favorable to the
Executive, as in effect at any time thereafter with respect to
other key executives.
IV-44
<PAGE>
(v) Expenses. During the Employment Period, the
Executive shall be entitled to receive prompt reimbursement for all
reasonable expenses incurred by the Executive in accordance with
the most favorable policies and procedures of the Corporation and
its affiliates in effect at any time during the 90-day period
immediately preceding the Effective Date or, if more favorable to
the Executive, as in effect at any time thereafter with respect to
other key executives.
(vi) Fringe Benefits. During the Employment
Period, the Executive shall be entitled to fringe benefits, in
accordance with the most favorable policies of the Corporation and
its affiliates in effect at any time during the 90-day period
immediately preceding the Effective Date or, if more favorable to
the Executive, as in effect at any time thereafter with respect to
other key executives.
(vii) Office and Support Staff. During the
Employment Period, the Executive shall be entitled to an office or
offices of a size and with furnishings and other appointments, and
to secretarial and other assistance, at least equal to those
provided to the Executive at any time during the 90-day period
immediately preceding the Effective Date which would be most
favorable to the Executive or, if more favorable to the Executive,
as provided at any time thereafter with respect to other key
executives.
(viii) Vacation. During the Employment Period, the
Executive shall be entitled to paid vacation in accordance with the
most favorable policies of the Corporation and its affiliates as in
effect at any time during the 90-day period immediately preceding
the Effective Date or, if more favorable to the Executive, as in
effect at any time thereafter with respect to other key executives.
5. Termination. (a) Death or Disability. This
Agreement shall terminate automatically upon the Executive's death.
The Corporation may terminate this Agreement, after having
established the Executive's Disability (pursuant to the definition
of "Disability" set forth below), by giving to the Executive
written notice of its intention to terminate the Executive's
IV-45
<PAGE>
employment. In such a case, the Executive's employment with the
Corporation shall terminate effective on the 180th day after
receipt of such notice (the "Disability Effective Date"), provided
that, within 180 days after such receipt, the Executive shall not
have returned to full-time performance of the Executive's duties.
For purposes of this Agreement, "Disability" means disability
which, at least 26 weeks after its commencement, is determined to
be total and permanent by a physician selected by the Corporation
or its insurers and acceptable to the Executive or the Executive's
legal representative (such agreement as to acceptability not to be
withheld unreasonably).
(b) Cause. The Corporation may terminate the
Executive's employment for "Cause." For purposes of this Agreement,
"Cause" means (i) an act or acts of dishonesty taken by the
Executive and intended to result in substantial personal enrichment
of the Executive at the expense of the Corporation, (ii) repeated
violations by the Executive of the Executive's obligations under
Section 4(a) of this Agreement which are demonstrably willful and
deliberate on the Executive's part and which are not remedied after
the receipt of notice from the Corporation or (iii) the conviction
of the Executive of a felony.
(c) Termination by Executive for Good Reason. The
Executive's employment may be terminated by the Executive for Good
Reason. For purposes of this Agreement, "Good Reason" means
(i) (A) the assignment to the Executive of any duties
inconsistent in any respect with the Executive's position
(including status, offices, titles and reporting
requirements), authority, duties or responsibilities as
contemplated by Section 4(a) of this Agreement, or (B) any
other action by the Corporation which results in a diminution
in such position, authority, duties or responsibilities, other
than an insubstantial and inadvertent action which is remedied
by the Corporation promptly after receipt of notice thereof
given by the Executive;
IV-46
<PAGE>
(ii) any failure by the Corporation to comply with any
of the provisions of Section 4(b) of this Agreement, other
than an insubstantial and inadvertent failure which is
remedied by the Corporation promptly after receipt of notice
thereof given by the Executive;
(iii) the Corporation's requiring the Executive to be
based at any office or location other than that described in
Section 4(a)(i)(B) hereof, except for travel reasonably
required in the performance of the Executive's
responsibilities;
(iv) any purported termination by the Corporation of
the Executive's employment otherwise than as permitted by this
Agreement; or
(v) any failure by the Corporation to comply with and
satisfy Section 11(c) of this Agreement.
Anything in this Agreement to the contrary
notwithstanding, any termination by the Executive for any reason
whatsoever during the six month period immediately following the
first anniversary of the date of a Change of Control shall be a
termination for "Good Reason". For purposes of this Section 5(c),
any good faith determination of "Good Reason" made by the Executive
shall be conclusive.
(d) Notice of Termination. Any termination by the
Corporation for Cause or by the Executive for Good Reason shall be
communicated by Notice of Termination to the other party hereto
given in accordance with Section 12(b) of this Agreement. For
purposes of this Agreement, a "Notice of Termination" means a
written notice which (i) indicates the specific termination
provision in this Agreement relied upon, (ii) sets forth in
reasonable detail the facts and circumstances claimed to provide a
basis for termination of the Executive's employment under the
provision so indicated and (iii) if the termination date is other
IV-47
<PAGE>
than the date of receipt of such notice, specifies the termination
date (which date shall be not more than fifteen (15) days after the
giving of such notice).
(e) Date of Termination. "Date of Termination" means
the date of receipt of the Notice of Termination or any later date
specified therein, as the case may be. If the Executive's
employment is terminated by the Corporation other than for Cause or
Disability, the Date of Termination shall be the date on which the
Corporation notifies the Executive of such termination.
6. Obligations of the Corporation upon Termination. (a)
Death. If the Executive's employment is terminated by reason of
the Executive's death, this Agreement shall terminate without
further obligations to the Executive's legal representatives under
this Agreement, other than those obligations accrued or earned by
the Executive hereunder at the date of the Executive's death.
Anything in this Agreement to the contrary notwithstanding, the
Executive's family shall be entitled to receive benefits at least
equal to the most favorable benefits provided by the Corporation to
surviving families of executives of the Corporation under such
plans, programs and policies relating to family death benefits, if
any, as in effect at any time during the 90-day period immediately
preceding the Effective Date or, if more favorable to the Executive
and/or the Executive's family, as in effect on the date of the
Executive's death with respect to other key executives and their
families.
(b) Disability. If the Executive's employment is
terminated by reason of the Executive's Disability, this Agreement
shall terminate without further obligations to the Executive, other
than those obligations accrued or earned by the Executive hereunder
as of the Disability Effective Date. Anything in this Agreement to
the contrary notwithstanding, the Executive shall be entitled after
the Disability Effective Date to receive disability and other
benefits at least equal to the most favorable of those provided by
the Corporation to disabled employees and/or their families in
accordance with such plans, programs and policies relating to
disability, if any, as in effect at any time during the 90-day
period immediately preceding the Effective Date or, if more
IV-48
<PAGE>
favorable to the Executive and/or the Executive's family, as in
effect at any time thereafter with respect to other key executives
and their families.
(c) Cause; Other than for Good Reason. If the
Executive's employment shall be terminated for Cause or the
Executive terminates his employment other than for Good Reason, the
Corporation shall pay the Executive his full Base Salary through
the Date of Termination at the rate in effect at the time Notice of
Termination is given and shall have no further obligations to the
Executive under this Agreement.
(d) Termination by Executive for Good Reason;
Termination by Corporation Other Than for Cause or Disability. If,
during the Employment Period, the Corporation shall terminate the
Executive's employment other than for Cause or Disability, or the
employment of the Executive shall be terminated by the Executive
for Good Reason:
(i) the Corporation shall pay to the Executive in a
lump sum in cash within 10 days after the Date of Termination
(the "Payment Date") the aggregate of the following amounts:
A. to the extent not theretofore paid, the
Executive's Base Salary through the Date of Termination
at the rate in effect on the Date of Termination or, if
higher, at the highest rate in effect at any time within
the three year period preceding the Effective Date (the
"Highest Base Salary"); and
B. the product of (x) the average of the annual
bonuses paid, or payable to the extent deferred, to the
Executive for the three full fiscal years prior to the
Effective Date (the "Recent Bonus") and (y) the fraction
obtained by dividing (i) the number of days between the
Date of Termination and the last day of the last full
fiscal year and (ii) 365; and
IV-49
<PAGE>
C. the product of (x) three and (y) the sum of the
Highest Base Salary and (ii) the Recent Bonus; and
D. in the case of compensation previously deferred
by the Executive, all amounts previously deferred and not
yet paid by the Corporation; and
(ii) for one year after the Date of Termination, the
Corporation shall continue benefits to the Executive and/or
the Executive's family at least equal to those which would
have been provided to them in accordance with the plans,
programs and policies described in Section 4(b)(iv) of this
Agreement if the Executive's employment had not been
terminated, including health insurance and life insurance, if
and as in effect at any time during the 90-day period
immediately preceding the Effective Date or, if more favorable
to the Executive, as in effect at any time thereafter with
respect to other key executives and their families and for
purposes of eligibility for retiree benefits pursuant to such
plans, programs and policies, the Executive shall be
considered to have remained employed until the end of the
Employment Period and to have retired on the last day of such
period.
Anything herein to the contrary notwithstanding, the
Executive may elect in his Notice of Termination to receive the
payment provided for pursuant to Section 6(d)(i)(C) hereof (the
"Severance Payment") in installments. If the Executive elects the
installment method, one-quarter of the Severance Payment shall be
paid to the Executive on the Payment Date and one-quarter of the
severance payment shall be paid to the Executive on each of the
next three anniversaries thereof and, in the case of the latter
three payments, the amounts to be paid shall include interests from
the Payment Date on the remaining unpaid balance of the Severance
Payment calculated at the Morgan Guaranty Trust Company prime rate
as in effect from time to time.
7. Non-exclusivity of Rights. Nothing in this
Agreement shall prevent or limit the Executive's continuing or
future participation in any benefit, bonus, incentive or other plan
IV-50
<PAGE>
or program provided by the Corporation or any of its affiliated
companies and for which the Executive may qualify, nor shall
anything herein limit or otherwise affect such rights as the
Executive may have under any stock option or other agreements with
the Corporation or any of its affiliated companies. Amounts which
are vested benefits or which the Executive is otherwise entitled to
receive under any plan or program of the Corporation or any of its
affiliated companies at or subsequent to the Date of Termination
shall be payable in accordance with such plan or program.
8. Full Settlement. The Corporation's obligation to
make the payments provided for in this Agreement and otherwise to
perform its obligations hereunder shall not be affected by any
set-off, counterclaim, recoupment, defense or other claim, right or
action which the Corporation may have against the Executive or
others. In no event shall the Executive be obligated to seek other
employment or take any other action by way of mitigation of the
amounts payable to the Executive under any of the provisions of
this Agreement. The Corporation agrees to pay, to the full extent
permitted by law, all legal fees and expenses which the Executive
may reasonably incur as a result of any contest (regardless of the
outcome thereof) by the Corporation or others of the validity or
enforceability of, or liability under, any provision of this
Agreement or any guarantee of performance thereof or as a result of
any contest by the Executive about the amount of any payment
pursuant to Section 9 of this Agreement, plus in each case interest
at the Federal Rate (as defined below).
9. Gross-up.
(a) In the event it shall be determined that any
payment, benefit or distribution (or combination thereof) by the
Corporation to or for the benefit of Executive (whether paid or
payable or distributed or distributable pursuant to the terms of
this Agreement, or otherwise) (a "Payment") would be subject to the
excise tax imposed by Section 4999 of the Internal Revenue Code of
1986, as amended (the "Code"), or any interest or penalties are
incurred by Executive with respect to such excise tax (such excise
tax, together with any such interest and penalties, hereinafter
collectively referred to as the "Excise Tax"), Executive shall be
IV-51
<PAGE>
entitled to receive an additional payment (a "Gross-Up Payment") in
an amount such that after payment by Executive of the Excise Tax
imposed upon the Gross-Up Payment, Executive retains an amount of
the Gross-Up Payment equal to the Excise Tax imposed upon the
Payments.
(b) Subject to the provisions of Section 9(c), all
determinations required to be made under this Section 9, including
whether and when a Gross-Up Payment is required and the amount of
such Gross-Up Payment and the assumptions to be utilized in
arriving at such determination, shall be made by Arthur Andersen &
Co. (the "Accounting Firm") which shall provide detailed supporting
calculations both to the Corporation and Executive within fifteen
(15) business days of the receipt of notice from Executive that
there has been a Payment, or such earlier time as is requested by
the Corporation. In the event that the Accounting Firm is serving
as accountant or auditor for an individual, entity or group
effecting the change in ownership or effective control (within the
meaning of Section 280G of the Code), Executive shall appoint
another nationally recognized accounting firm to make the
determinations required hereunder (which accounting firm shall then
be referred to as the Accounting Firm hereunder). All fees and
expenses of the Accounting Firm shall be borne solely by the
Corporation. Any Gross-Up Payment, as determined pursuant to this
Section 9, shall be paid by the Corporation to Executive within
five (5) days after the receipt of the Accounting Firm's
determination. If the Accounting Firm determines that no Excise
Tax is payable by Executive, it shall so indicate to Executive in
writing. Any determination by the Accounting Firm shall be binding
upon the Corporation and Executive. As a result of the uncertainty
in the application of Section 4999 of the Code at the time of the
initial determination by the Accounting Firm hereunder, it is
possible that Gross-Up Payments which will not have been made by
the Corporation should have been made ("Underpayment"), consistent
with the calculations required to be made hereunder. In the event
that the Corporation exhausts its remedies pursuant to Section 9(c)
and Executive thereafter is required to make a payment of any
Excise Tax, the Accounting Firm shall determine the amount of the
IV-52
<PAGE>
Underpayment that has occurred and any such Underpayment shall be
promptly paid by the Corporation to or for the benefit of
Executive.
(c) Executive shall notify the Corporation in writing of
any claim by the Internal Revenue Service that, if successful,
would require the payment by the Corporation of the Gross-Up
Payment. Such notification shall be given as soon as practicable
but no later than ten (10) business days after Executive is
informed in writing of such claim and shall apprise the Corporation
of the nature of such claim and the date on which such claim is
requested to be paid. Executive shall not pay such claim prior to
the expiration of the thirty (30) day period following the date on
which it gives such notice to the Corporation (or such shorter
period ending on the date that any payment of taxes with respect to
such claim is due). If the Corporation notifies Executive in
writing prior to the expiration of such period that it desires to
contest such claim, Executive shall:
(i) give the Corporation any information reasonably
requested by the Corporation relating to such claim;
(ii) take such action in connection with contesting such
claim as the Corporation shall reasonably request in writing from
time to time, including, without limitation, accepting legal
representation with respect to such claim by an attorney reasonably
selected by the Corporation;
(iii) cooperate with the Corporation in good faith in
order to effectively contest such claim; and
(iv) permit the Corporation to participate in any
proceedings relating to such claim;
provided, however, that the Corporation shall bear and pay directly
all costs and expenses (including additional interest and
penalties) incurred in connection with such contest and shall
indemnify and hold Executive harmless, on an after-tax basis, for
any Excise Tax (including interest and penalties with respect
thereto) imposed as a result of such representation and payment of
costs and expenses. Without limitation on the foregoing provisions
IV-53
<PAGE>
of this Section 9(c), the Corporation shall control all proceedings
taken in connection with such contest and, at its sole option, may
pursue or forego any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in respect of
such claim and may, at its sole option, either direct Executive to
pay the tax claimed and sue for a refund or contest the claim in
any permissible manner, and Executive agrees to prosecute such
contest to a determination before any administrative tribunal, in
a court of initial jurisdiction and in one or more appellate
courts, as the Corporation shall determine; provided, however, that
if the Corporation directs Executive to pay such claim and sue for
a refund, the Corporation shall advance the amount of such payment
to Executive, on an interest-free basis, and shall indemnify and
hold Executive harmless, on an after-tax basis, from any Excise Tax
(including interest or penalties with respect thereto) imposed with
respect to such advance or with respect to any imputed income with
respect to such advance; and provided, further, that if Executive
is required to extend the statute of limitations to enable the
Corporation to contest such claim, Executive may limit this
extension solely to such contested amount.
(d) If, after the receipt by Executive of an amount
advanced by the Corporation pursuant to Section 9(c), Executive
becomes entitled to receive any refund with respect to such claim,
Executive shall (subject to the Corporation's complying with the
requirements of Section 9(c)) promptly pay to the Corporation the
amount of such refund (together with any interest paid or credited
thereon after taxes applicable thereto). If, after the receipt by
Executive of an amount advanced by the Corporation pursuant to
Section 9(c), a determination is made that Executive shall not be
entitled to any refund with respect to such claim and the
Corporation does not notify Executive in writing of its intent to
contest such denial of refund prior to the expiration of thirty
(30) days after such determination, then such advance shall be
forgiven and shall not be required to be repaid and the amount of
such advance shall offset, to the extent thereof, the amount of
Gross-Up Payment required to be paid.
10. Confidential Information. The Executive shall hold
in a fiduciary capacity for the benefit of the Corporation all
secret or confidential information, knowledge or data relating to
IV-54
<PAGE>
the Corporation or any of its affiliated companies, and their
respective businesses, which shall have been obtained by the
Executive during the Executive's employment by the Corporation or
any of its affiliated companies and which shall not be public
knowledge (other than by acts by the Executive or his
representatives in violation of this Agreement). After termination
of the Executive's employment with the Corporation, the Executive
shall not, without the prior written consent of the Corporation,
communicate or divulge any such information, knowledge or data to
anyone other than the Corporation and those designated by it. In
no event shall an asserted violation of the provisions of this
Section 10 constitute a basis for deferring or withholding any
amounts otherwise payable to the Executive under this Agreement.
11. Successors. (a) This Agreement is personal to the
Executive and without the prior written consent of the Corporation
shall not be assignable by the Executive otherwise than by will or
the laws of descent and distribution. This Agreement shall inure
to the benefit of and be enforceable by the Executive's legal
representatives.
(b) This Agreement shall inure to the benefit of and be
binding upon the Corporation and its successors.
(c) The Corporation will require any successor (whether
direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or
assets of the Corporation to expressly assume and agree to perform
this Agreement in the same manner and to the same extent that the
Corporation would be required to perform it if no such succession
had taken place. As used in this Agreement, "Corporation" shall
mean the Corporation as hereinbefore defined and any successor to
its business and/or assets as aforesaid which assumes and agrees to
perform this Agreement by operation of law, or otherwise.
12. Miscellaneous. (a) This Agreement shall be
governed by and construed in accordance with the laws of the State
of New Jersey, without reference to principles of conflict of laws.
The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect. This Agreement may not
IV-55
be amended or modified otherwise than by a written agreement
executed by the parties hereto or their respective successors and
legal representatives.
(b) All notices and other communications hereunder shall
be in writing and shall be given by hand delivery to the other
party or by registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:
If to the Executive:
Charles P. Grom
9 Glen Ridge Drive
Long Valley, NJ 07853
If to the Corporation:
C. R. BARD, INC.
730 Central Avenue
Murray Hill, New Jersey 07974
Attention: General Counsel
or to such other address as either party shall have furnished to
the other in writing in accordance herewith. Notice and
communications shall be effective when actually received by the
addressee.
(c) The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability
of any other provision of this Agreement.
(d) The Corporation may withhold from any amounts
payable under this Agreement such Federal, state or local taxes as
shall be required to be withheld pursuant to any applicable law or
regulation.
IV-56
<PAGE>
(e) The Executive's failure to insist upon strict
compliance with any provision hereof shall not be deemed to be a
waiver of such provision or any other provision thereof.
(f) This Agreement contains the entire understanding of
the Corporation and the Executive with respect to the subject
matter hereof.
(g) The Executive and the Corporation acknowledge that
the employment of the Executive by the Corporation is "at will",
and, prior to the Effective Date, may be terminated by either the
Executive or the Corporation at any time. Upon a termination of
the Executive's employment or upon the Executive's ceasing to be an
officer of the Corporation, in each case, prior to the Effective
Date, there shall be no further rights under this Agreement.
IN WITNESS WHEREOF, the Executive has hereunto set his
hand and, pursuant to the authorization from its Board of
Directors, the Corporation has caused these presents to be executed
in its name on its behalf, all as of the day and year first above
written.
/s/ Charles P. Grom
Charles P. Grom
C. R. BARD, INC.
By: /s/ William H. Longfield
Name: William H. Longfield
Title: Chairman and
Chief Executive Officer
Attest:/s/ Jean F. Miller
Jean F. Miller
Assistant Secretary
IV-57
Exhibit 12.1
<TABLE>
<CAPTION>
Computation of Ratio of Earnings to Fixed Charges
For The Twelve Month Period Ending December 31, 1996
1996 1995 1994 1993 1992 1991
<S> <C> <C> <C> <C> <C> <C>
Earnings before taxes $102,700 $123,500 $104,100 $101,400 $120,200 $ 88,700
Add(Deduct)
Fixed Charges 33,500 31,500 23,200 18,700 19,900 21,200
Undistributed earnings
of less than 50% owned
companies carried at
equity (700) (800) (400) (200) (500) (500)
Interest capitalized 0 0 (200) 0 (300) (900)
Earnings available for fixed
charges $135,500 $154,200 $126,700 $119,900 $139,300 $108,500
Fixed charges:
Interest, including
amounts capitalized 26,400 24,200 16,500 12,500 13,700 14,800
Proportion of rent
expense deemed to
represent interest
factor 7,100 7,300 6,700 6,200 6,200 6,400
Fixed Charges $ 33,500 $ 31,500 $ 23,200 $ 18,700 $ 19,900 $ 21,200
Ratio of earnings to fixed
charges 4.04 4.89 5.46 6.41 7.00 5.12
<FN>
</TABLE>
C. R. BARD, INC. AND SUBSIDIARIES
Exhibit 21
Parents and Subsidiaries of Registrant
The following table lists, as of December 31, 1996, the company
and its significant subsidiaries and indicates the jurisdiction
of organization of each subsidiary and the percentage of voting
securities owned by the immediate parent of each subsidiary.
Where % of
Incorporated Voting Stock
C. R. Bard, Inc. New Jersey (Registrant)
Bard Access Systems, Inc. Utah 100
Bard Canada Inc. Canada 100
Purchaseco Inc. Canada 100
Vas-Cath Holdings Ltd. Canada 100
Vas-Cath, Inc. Canada 100
Med-Pro Design Inc. Canada 100
Bard Cardiopulmonary, Inc. Delaware 100
Bard Devices, Inc. Delaware 100
Davol Inc. Delaware 100
American Hydro-Surgical
Instruments, Inc. Maryland 100
Bard Diagnostic Sciences, Inc. Washington 100
Bard Fiberoptic Technologies,
Inc. Michigan 100
Bard Holdings Limited England 100
Bard Limited England 100
Bard Sendirian Berhad Malaysia 100
Angiomed UK Limited England 100
Bard Implants, Inc. Delaware 100
Bard International, Inc. Delaware 100
Bard Japan Limited Japan 100
Productos Bard de Mexico S.A.
de C.V. Mexico 100
Bard Shannon Limited Ireland 100
Angiomed GmbH Germany 100
Angiomed Netherlands Netherlands 100
Bard Benelux N.V. Belgium 100
Bard Dublin Ireland 100
Bard de Espana, S.A. Spain 100
Bard Portugal LDA Portugal 100
Bard Galway Limited Ireland 100
Bard Connaught Limited Ireland 100
Bard S.P.A. Italy 100
Angiomed Italy S.P.A. Italy 100
C. R. Bard GmbH Germany 100
Angiomed KG Germany 100
IV-58
<PAGE>
C. R. BARD, INC. AND SUBSIDIARIES
Exhibit 21
Parents and Subsidiaries of Registrant (continued)
Where % of
Incorporated Voting Stock
C. R. Bard Ireland Limited Ireland 100
Laboratories Bard S.A. France 100
Cardial S.A. France 100
BCP Puerto Rico, Inc. Delaware 100
BCR Delaware, Inc Delaware 100
Catalina Acquisition Corp. Delaware 100
IMPRA, Inc. Arizona 100
Impra Canada, Inc. Arizona 100
Impra Foreign Sales Corporation Arizona 100
Impra Medica GmbH Arizona 100
Impra Medica S.A. Arizona 100
Impra Medica S.A.R.L. Arizona 100
Impra (UK) Ltd. Arizona 100
Laboratoires Bard, Inc. Delaware 100
Bard Nice S.N.C. France 100
Laparoscopic Devices Acquisition
Corp. Delaware 100
MedChem Products, Inc. Massachusetts 100
Gesco International, Inc. Massachusetts 100
Pilot Cardiovascular Systems, Inc. Delaware 100
Roberts Laboratories, Inc. Arizona 100
The Consolidated Financial Statements include the accounts of the
Registrant and all its wholly-owned subsidiaries.
IV-59
Exhibit 23
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
To C. R. Bard, Inc.:
As independent public accountants, we hereby consent to the
incorporation by reference of our report dated January 24, 1997,
included in this Form 10-K, into C. R. Bard, Inc.'s previously
filed Registration Statements (i) on Form S-8 for its Employees'
Retirement Savings Plan of C. R. Bard, Inc., Registration
No. 2-86291, the 1990 Employee Stock Option Plan, as amended,
Registration No. 33-35544 and the C. R. Bard, Inc. 1988 Directors
Stock Award Plan, as amended, the 1993 Long Term Incentive Plan
of C. R. Bard, Inc., Registration No. 33-64874, and the 1993 Long Term
Incentive Plan of C. R. Bard, Inc., Registration No. 333-07189 and
the MedChem Products, Inc. 1994 Stock Option Plan, MedChem Products, Inc.
1993 Stock Option Plan, MedChem Products, Inc. 1993 Spin-off Stock
Option Plan, MedChem Products, Inc. 1993 Director Stock Option
Plan, MedChem Products, Inc. Amended and Restated Stock Option Plan
all formerly maintained by MedChem Products, Inc.,
Registration No 33-63147, and (ii) on Form S-3, Registration
No. 333-05997.
ARTHUR ANDERSEN LLP
Roseland, New Jersey
March 24, 1997
IV-60
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<CASH> 11,300
<SECURITIES> 66,700
<RECEIVABLES> 245,400
<ALLOWANCES> 10,200
<INVENTORY> 245,000
<CURRENT-ASSETS> 576,900
<PP&E> 364,600
<DEPRECIATION> 138,500
<TOTAL-ASSETS> 1,332,500
<CURRENT-LIABILITIES> 336,200
<BONDS> 342,800
0
0
<COMMON> 14,300
<OTHER-SE> 584,200
<TOTAL-LIABILITY-AND-EQUITY> 1,332,500
<SALES> 1,194,400
<TOTAL-REVENUES> 1,194,400
<CGS> 581,300
<TOTAL-COSTS> 1,024,400
<OTHER-EXPENSES> 40,900
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 26,400
<INCOME-PRETAX> 102,700
<INCOME-TAX> 10,200
<INCOME-CONTINUING> 92,500
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 92,500
<EPS-PRIMARY> 1.62
<EPS-DILUTED> 1.62
</TABLE>
