-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, FYrDdscf1P94CTpW1cSIUNAMI7itQSeEyRm3MlzYmZ3YUNv+iYF/lYfXjs5g43KA mq/omcIDK2sDZs8Bg+ny6g== 0000950123-95-003014.txt : 19951025 0000950123-95-003014.hdr.sgml : 19951025 ACCESSION NUMBER: 0000950123-95-003014 CONFORMED SUBMISSION TYPE: SC 14D1/A PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 19951024 SROS: NYSE GROUP MEMBERS: JNJ ACQUISITION CORP. GROUP MEMBERS: JOHNSON & JOHNSON ET AL SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: CORDIS CORP CENTRAL INDEX KEY: 0000024654 STANDARD INDUSTRIAL CLASSIFICATION: SURGICAL & MEDICAL INSTRUMENTS & APPARATUS [3841] IRS NUMBER: 590870525 STATE OF INCORPORATION: FL FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: SC 14D1/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-07671 FILM NUMBER: 95583644 BUSINESS ADDRESS: STREET 1: 5200 BLUE LAGOON DR STREET 2: STE 200 CITY: MIAMI STATE: FL ZIP: 33126 BUSINESS PHONE: 3058242000 MAIL ADDRESS: STREET 1: 14201 N W 60TH CITY: MIAMI LAKES STATE: FL ZIP: 33014 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: JOHNSON & JOHNSON ET AL CENTRAL INDEX KEY: 0000200406 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 221024240 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 14D1/A BUSINESS ADDRESS: STREET 1: ONE JOHNSON & JOHNSON PLZ CITY: NEW BRUNSWICK STATE: NJ ZIP: 08933 BUSINESS PHONE: 9085240400 SC 14D1/A 1 AMENDMENT NO. 2 TO SCHEDULE 14D-1 1 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------ SCHEDULE 14D-1 TENDER OFFER STATEMENT PURSUANT TO SECTION 14(D)(1) OF THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. 2) ------------------------ CORDIS CORPORATION (Name of Subject Company) JOHNSON & JOHNSON JNJ ACQUISITION CORP. (Bidders) COMMON STOCK, PAR VALUE $1.00 PER SHARE (INCLUDING THE ASSOCIATED RIGHTS) (Title of Class of Securities) 21852510 (CUSIP Number of Class of Securities) ------------------------ JOSEPH S. ORBAN, ESQ. JOHNSON & JOHNSON ONE JOHNSON & JOHNSON PLAZA NEW BRUNSWICK, NEW JERSEY 08933 (908) 524-2488 (Name, Address and Telephone Number of Persons authorized to Receive Notices and Communications on Behalf of Bidders) ------------------------ COPY TO: ROBERT A. KINDLER, ESQ. CRAVATH, SWAINE & MOORE WORLDWIDE PLAZA 825 EIGHTH AVENUE NEW YORK, NEW YORK 10019 (212) 474-1000 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Page 1 of 53 pages Exhibit Index located on Page 4 2 JNJ Acquisition Corp. and Johnson & Johnson hereby amend their Tender Offer Statement on Schedule 14D-1 (the "Statement"), originally filed on October 19, 1995, as amended by Amendment No. 1, with respect to JNJ Acquisition Corp.'s offer to purchase all outstanding shares of Common Stock, par value $1.00 per share, of Cordis Corporation, a Florida corporation, together with any associated rights, as set forth in this Amendment No. 2. Capitalized terms not defined herein have the meanings assigned thereto in the Statement. ITEM 1. SECURITY AND SUBJECT COMPANY. (a) The name of the subject company is Cordis Corporation, a Florida corporation (the "Company"), and the address of its principal executive offices is 5200 Blue Lagoon Drive, Suite 200, Miami, Florida 33126. ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER. On October 24, 1995, JNJ Acquisition Corp. delivered a demand to the Company, requesting that the Board of Directors fix a record date to determine the shareholders entitled to take certain actions by written consent, and J&J issued a press release, a copy of which is attached hereto as Exhibit (a)(10) and is incorporated herein by reference. ITEM 10. ADDITIONAL INFORMATION. Multiple class action complaints have been filed against the Company and its directors by shareholders of the Company seeking declaratory and injunctive relief. Copies of these complaints are attached hereto as exhibits (g)(2)-(4) and are incorporated herein by reference. On October 24, 1995, J&J issued a press release, a copy of which is attached hereto as Exhibit (a)(10) and is incorporated herein by reference. ITEM 11. MATERIAL TO BE FILED AS EXHIBITS. (a)(10) Press Release, dated October 24, 1995. (g)(2) Complaint in Brickell Partners and Harry Lewis v. Robert C. Strauss, et. al. filed in the United States District Court for the Southern District of Florida on October 20, 1995. (3) Complaint in Brickell Partners v. Robert C. Strauss, et. al. filed in the 11th Judicial Circuit in and for Dade County, Florida on October 19, 1995. (4) Complaint in Harry Lewis v. Robert C. Strauss, et. al. filed in the Circuit Court for the 11th Judicial Circuit in and for Dade County, Florida on October 19, 1995. 2 3 SIGNATURES After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Dated: October 24, 1995 JOHNSON & JOHNSON By: /s/ JAMES T. LENEHAN ------------------------------------ Name: James T. Lenehan Title: Member, Executive Committee JNJ ACQUISITION CORP. By: /s/ JOSEPH S. ORBAN ------------------------------------ Name: Joseph S. Orban Title: President 3 4 INDEX TO EXHIBITS
SEQUENTIALLY EXHIBIT NUMBERED NUMBER EXHIBIT PAGE ---------- ----------------------------------------------------------------------- ------------ (a) (10) Press Release, dated October 24, 1995. ................................ (g) (2) Complaint in Brickell Partners and Harry Lewis v. Robert C. Strauss, et.al. filed in the United States District Court for the Southern District of Florida on October 20, 1995. ............................ (g) (3) Complaint in Brickell Partners v. Robert C. Strauss, et.al. filed in the 11th Judicial Circuit in and for Dade County, Florida on October 19, 1995. ........................................................... (g) (4) Complaint in Harry Lewis v. Robert C. Strauss, et.al. filed in the Circuit Court for the 11th Judicial Circuit in and for Dade County, Florida on October 19, 1995. ........................................
4 EX-99.A10 2 PRESS RELEASE, DATED OCTOBER 24, 1995 1 EXHIBIT (A)(10) 2 EXHIBIT (A)(10) JOHNSON & JOHNSON NEW BRUNSWICK, N.J. 08933 Press Contact: F. Robert Kniffin (908) 524-3535 (Home) (609) 799-0369 Investor Contact: Annie H. Lo (908) 524-6491 (Home) (908) 580-1258
FOR IMMEDIATE RELEASE JOHNSON & JOHNSON REQUESTING CORDIS TO SET RECORD DATE FOR WRITTEN CONSENT TO REMOVE AND REPLACE CORDIS BOARD ------------------------------ New Brunswick, N.J., October 24, 1995 -- Johnson & Johnson (NYSE:JNJ) announced today that it is requesting that Cordis Corporation (NASDAQ:CORD) set a record date as soon as possible with respect to the solicitation of written consents to remove and replace the Cordis Board. Under the By-law adopted by Cordis on October 23, 1995, the record date must be within the next 20 business days. As previously stated, if Cordis does not promptly agree to a $105 per share stock-for-stock merger, Johnson & Johnson intends to solicit written consents in order to remove and replace the Cordis Board in order to effect such merger. Cordis shareholders as of the record date would be entitled to vote in such consent solicitation. EX-99.G2 3 COMPLAINT IN BRICKELL PARTNERS & HARRY LEWIS 1 EXHIBIT (g)(2) 2 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA ...........................................X ) BRICKELL PARTNERS, ) a Florida Partnership, ) Civil Action No. and HARRY LEWIS, Individually ) 95-2320 And On Behalf of All Others ) CIV-DAVIS Similarly Situated, ) ) Plaintiffs, ) ) CLASS ACTION COMPLAINT ) ---------------------- - against - ) ) ROBERT C. STRAUSS, WILTON W. ) MAGISTRATE WEBSTER, JR., DAVID R. ) JOHNSON CHALLONER, RICHARD W. ) FOXEN, DONALD F. MALIN, JR., ) JAN VAN STEVENINCK, PATRICIA K. ) WOOLF, CATHERINE M. BURZIK, ) WILLIAM J. RAZZOUK, and ) CORDIS CORPORATION, ) ) Defendants. ) ...........................................X Plaintiffs, by their attorneys, allege upon personal knowledge as to their own acts and upon information and belief as to all other matters, as follows: JURISDICTION AND VENUE 1. Plaintiffs bring this Action pursuant to Sections 14(a) and 20 of the Securities Exchange Act of 1934 (the "1934 Act") and Rule 14a-9 adopted by the Securities Exchange Commission, (the "SEC") thereunder and applicable principles of common law. 2. This Court has jurisdiction pursuant to Section 27 of the 1934 Act 15 U.S.C. sec. 78aa, and under principles of pendent jurisdiction. 3 3. Venue is proper in this district because the events and omissions giving rise to the claims alleged herein have occurred, are occurring and, unless restrained, will continue to occur, in this district, including the dissemination of false and misleading proxy solicitation material. Cordis is incorporated in Florida and has its principal place of business in this district. In addition, defendants transacted business in this district during the Class period, as defined below. 4. In connection with the acts and conduct alleged in this complaint, defendants directly and indirectly, used the means and instrumentalities of interstate commerce, including the mails and telephone communication, and the facilities of national securities exchanges, namely, NASDAQ's National Market System. PARTIES 5. Plaintiffs are and, at all relevant times, have been the owners of shares of Cordis common stock. 6. Cordis is a corporation duly organized and existing under the laws of the State of Florida. Cordis designs, manufactures and sells certain medical devices consisting of angiographic catheters, neuroscience devices and related instrumentation. Cordis maintains its principal executive offices at 14201 Northwest 60th Avenue, Miami Lakes, Florida. Cordis has approximately 16.4 million - 2 - 4 shares of common stock outstanding and hundreds of stockholders of record. Cordis' stock trades over the NASDAQ National Market System. 7. Defendant Robert C. Strauss ("Strauss") is and at all relevant times hereto has been the President, Chief Executive Officer, and Chairman of the Board of Directors of Cordis. 8. Wilton W. Webster, Jr. ("Webster") is and at all relevant times hereto has been a Vice President and a director of Cordis. 9. Defendants David R. Challoner, Richard W. Foxen, Donald F. Malin, Jr., Jan van Steveninck, Catherine M. Burzik, William J. Razzouk, and Patricia K. Woolf are directors of Cordis. 10. The defendants named in paragraphs 7 through 9 are hereinafter referred to as the "Individual Defendants." 11. Because of their positions as officers/directors of the Company, the Individual Defendants owe a fiduciary duty of loyalty and due care to plaintiffs and the other members of the class. 12. Each defendant herein is sued individually as a conspirator and aider and abettor, as well as in his/her capacity as an officer and/or director of the Company, and the liability of each arises from the fact that he or she - 3 - 5 has engaged in all or part of the unlawful acts, plans, schemes, or transactions complained of herein. CLASS ACTION ALLEGATIONS 13. Plaintiffs bring this action in their own behalf and as a class action, pursuant to Rule 23(a) and (b)(2) and (3) of the Federal Rules of Civil Procedure, on behalf of all stockholders of the Company as of August 15, 1995 and their successors in interest, except defendants herein and any person, firm, trust, corporation, or other entity related to or affiliated with any of the defendants, or any of the Company's principal stockholders, who will be threatened with injury arising from defendants' actions as is described more fully below. 14. This action is properly maintainable as a class action. 15. The class is so numerous that joinder of all members is impracticable. The Company has thousands of stockholders who are scattered throughout the United States. 16. There are questions of law and fact common to the class that predominate over questions affecting any individual class member. The common questions include, inter alia, whether: (a) defendants violated federal securities laws by the acts and omissions alleged herein; - 4 - 6 (b) the proxy solicitation material disseminated by Cordis to the Class omitted and/or misrepresented material facts; (c) defendants participated in and pursued the common course of conduct complained of; (d) defendants acted willfully or recklessly in omitting and/or misrepresenting material facts; (e) defendants breached their fiduciary duties owed by them to plaintiffs and other members of the Class by failing and refusing to attempt in good faith to maximize shareholder value in the sale of Cordis; (f) Cordis' Poison Pill was defensively enacted and implemented to entrench defendants in their office and deprive Cordis public shareholders of the maximum value of their holdings; (g) defendants have breached or aided and abetted the breach of the fiduciary duties owed by them to plaintiffs and other members of the Class; (h) defendants engaged in a plan and scheme to thwart and reject offers and proposals from third parties, including Johnson & Johnson ("J&J"), who is a major manufacturer and seller of a range of health care products; and (i) plaintiffs and the other members of the Class are being and will continue to be injured by the - 5 - 7 wrongful conduct alleged herein and, if so, what is the proper remedy and/or measure of damages. 17. Plaintiffs are committed to prosecuting the action and have retained competent counsel experienced in litigation of this nature. Plaintiffs' claims are typical of the claims of the other members of the class and plaintiffs have the same interests as the other members of the class. Plaintiffs are adequate representatives of the class. SUBSTANTIVE ALLEGATIONS 18. On October 19, 1995, the Dow Jones News Wire reported that J&J would commence "a $100-a-share cash tender offer for all of the outstanding stock of Cordis after Cordis rebuffed J&J's offer to negotiate a merger." The estimated value of the tender offer is $1.6 billion. 19. In connection with the tender offer, J&J announced that it had previously offered as much as $105-a-share in a stock-for-stock, tax-free transaction which was valued at $1.7 billion - or $100 million more than the tender offer. However, Cordis rejected this transaction and refused to negotiate with J&J. The $105 per share offering price represents a 22% premium over the trading price of Cordis stock on one day prior to announcement of the J&J tender offer. - 6 - 8 20. As further evidence of defendants' intransigence, The Wall Street Journal reported on October 16, 1995, that the Individual Defendants had adopted and implemented a Poison Pill in anticipation of the J&J tender offer. Under the Plan, which is effective immediately, shareholders are given a dividend of one share purchase right ("Right") for each common share outstanding at the close of business on October 23, 1995. 21. The adoption and implementation of the Poison Pill has the force and effect of entrenching the Individual Defendants in their corporate offices against any real or perceived threat to their control, and dramatically impairs the rights of Class members to exercise freedom of choice in a proxy contest or to avail themselves of a bona fide offer to purchase their shares by an acquiror, such as J&J, unfavored by incumbent management. This fundamental shift of control of the Company's destiny from the hands of its shareholders to the hands of the Individual Defendants results in a heightened fiduciary duty of the Individual Defendants to consider, in good faith, a third party bid, such as J&J, and further requires the Individual Defendants to pursue a third party's interest in acquiring the Company and to negotiate in good faith with a bidder on behalf of the Company's shareholders. 22. The purpose, intent and effect of the Poison Pill, in the face of J&J's pending offer for the Company, is - 7 - 9 to thwart, deter, impede, and delay the acquisition of Cordis by J&J. 23. Defendants' recalcitrance to consider and promptly act upon J&J's earlier overtures and formal offer has no valid business purpose, and simply evidences their disregard for the attractive premium being offered to Cordis shareholders. By failing to meet and negotiate or offer to meet and negotiate with J&J, defendants are depriving plaintiffs and the Class of the right to share in the assets and businesses of Cordis and receive the maximum value for their shares. 24. On October 20, 1995, it was reported by The Wall Street Journal that J&J had been attempting to negotiate a merger with Cordis for more than a month and had each of its acquisition overtures rebuffed by the Company. 25. J&J had initiated a series of telephone conferences and meetings with Cordis on several occasions commencing September 6, 1995. On September 12, 1995, Ralph S. Larsen ("Larsen"), Chairman of the Board of J&J, held a teleconference with a Robert Marston ("Marston"), the Company's former Chief Executive Officer, to outline the strategic advantages of a Cordis/J&J combination. Among other things, Larsen indicated that it was J&J's intent to have Cordis operated as a separate subsidiary within the J&J company. Marston did not respond to Larsen's proposal but stated that Cordis would have to consider the proposal. - 8 - 10 26. On September 13, 1995, representatives of J&J and Cordis spoke and after reviewing the strategic benefits of the merger, set up another meeting regarding a negotiated transaction on either September 21, 1995. However, on September 19, 1995, defendant Strauss telephoned Larsen that the Cordis Board of Directors had met and determined that it would be premature to meet with J&J until after the October 10, 1995 Annual Meeting. 27. Cordis filed certain proxy materials (the "proxy materials") with the SEC in connection with its Annual Meeting on October 10, 1995 (the "Annual Meeting"). The proxy materials were disseminated on or about September 15, 1995 to stockholders of record as of August 15, 1995. The proxy materials made no mention or disclosure of the serious merger interest expressed by J&J or the other discussions referred to above. As a result, the proxy materials were materially incomplete because of defendants' failure to disclose the existence of the J&J bona fide interest in completing an acquisition. 28. Cordis' proxy material related to the Company's September 15, 1995 Annual Meeting, which was held to consider, inter alia: (a) the election of the Company's directors, and (b) an amendment to the Company's articles of incorporation to increase the number of authorized but unissued shares which could be issued in the event of a hostile offer. The proxy materials only stated that - 9 - 11 approval of the proposed amendments to Cordis' articles of incorporation "might deter a bidder from seeking to acquire shares of the Company on an unfriendly basis." No mention, however, was made of the fact J&J had already made repeated overtures for control of the Company prior to the October 10, 1995 meeting. At a vote taken at the Annual Meeting, the Company's shareholders approved the election of the directors but soundly defeated the proposal concerning the amendments to the articles of incorporation. 29. Despite the defendants' failure to secure a mandate from the Company's shareholders not to obstruct and acquisition offer which could maximize the value of the stockholder's investment, defendants nevertheless contacted J&J on October 11, 1995 and informed them, without shareholders' knowledge, that Cordis would remain independent. Moreover, six days later defendants caused Cordis to institute the Poison Pill. 30. Defendants continued their pattern of misrepresentation when they announced the creation of the Poison Pill on October 16, 1995. It was reported by the Dow Jones News Wire that the Company had stated that it had not enacted the Poison Pill in response to any takeover attempt. In light of the on-going attempts by J&J, Cordis had no truthful basis to make any such representation. COUNT I VIOLATION OF SECTION 14(A) OF THE SECURITIES - 10 - 12 AND EXCHANGE ACT OF 1934 AND SEC RULE 14A-9 31. Plaintiffs repeat and reallege the allegations set forth above in paragraphs 1 through 30. 32. Section 14(a) provides, in pertinent part, as follows: It shall be unlawful for any person, by the use of the mails or by any means or instrumentality of interstate commerce . . . in contravention of such rules and regulations as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors, to solicit . . . any proxy or consent or authorization in respect of any security . . . registered pursuant to section 12 of this title. 33. Rule 14a-9 is a rule promulgated by the SEC under Section 14(a). Rule 14a-9 provides, in pertinent part, as follows: No solicitation subject to this regulation shall be made by means of any proxy statement, form of proxy, notice of meeting, or other communication, written or oral, containing such statement which, at the time and in the light of the circumstances under which it is made, is false or misleading with respect to any material fact, or omits to state any material fact necessary in order to make the statements therein not false or misleading . . . . 34. In disseminating the proxy materials in connection with October 10, 1995 shareholder meeting, defendants intentionally or with reckless disregard omitted and misrepresented material facts concerning the existence of takeover attempts by J&J as set forth above. - 11 - 13 35. The Cordis securities are registered pursuant to Section 12 of the 1934 Act, as amended. 36. The proxy materials were disseminated by defendants on behalf of Cordis. Thus all defendants, who constitute the Board of Cordis participated in the violation of Section 14(a) and Rule 14a-9. 37. As a result of the actions of defendants, plaintiffs and the other members of the Class have and will be damaged in that they will have been provided with the proxy materials which contain material misrepresentations and omissions. 38. As a proximate result of the violations of Section 14(a) and Rule 14a-9 alleged herein, plaintiffs and the Class have suffered and will suffer immediate and irreparable injury. 39. Plaintiffs and the Class have no adequate remedy at law. COUNT II BREACH OF FIDUCIARY DUTY 40. Plaintiffs repeat and reallege the allegations set forth in paragraphs 1 through 39. 41. Defendants owe fundamental fiduciary obligations to Cordis's shareholders to take all necessary and appropriate steps to maximize the value of their shares. In addition, the Individual Defendants have the - 12 - 14 responsibility to act independently so that the interests of Cordis's public stockholders will be protected, to seriously consider all bona fide offers for the Company, and to conduct fair and active bidding procedures or other mechanisms for checking the market to assure that the highest possible price is achieved. Further, the directors of Cordis must adequately ensure that no conflict of interest exists between the Individual Defendants' own interests and their fiduciary obligations to maximize stockholder value or, if such conflicts exist, to insure that all such conflicts will be resolved in the best interests of the Company's shareholders. 42. Because defendants dominate and control the business and corporate affairs of Cordis and because they are in possession of private corporate information concerning Cordis' assets, businesses and future prospects, there exists an imbalance and disparity of knowledge of economic power between defendants and the public shareholders of Cordis. This discrepancy makes it grossly and inherently unfair for defendants to entrench themselves at the expense of its public shareholders. 43. The Individual Defendants have breached their fiduciary and other common law duties owed to plaintiffs and other members of the Class in that they have not and are not exercising independent business judgment and have acted and are acting to the detriment of the Class. - 13 - 15 44. In connection with the conduct described herein, the Individual Defendants breached their fiduciary duties by, among other things: a. rejecting the J&J proposal without fully informing themselves about or intentionally ignoring the future prospects of a combined Cordis/J&J company, or the intrinsic worth of Cordis; b. failing and refusing to meet with representatives of J&J; and c. erecting defensive measures such as Cordis' Poison Pill plan, which was designed to make it prohibitively expensive for an unapproved third party from acquiring the assets or control of the Company. 45. Moreover, defendants have refused to take those steps necessary to ensure that Cordis's shareholders will receive maximum value for their shares of Cordis stock. Defendants have thus refused to seriously consider the pending offer, and have failed to announce any active auction or open bidding procedures best calculated to maximize shareholder value in selling the Company. 46. The Individual Defendants are acting to entrench themselves in their offices and positions and - 14 - 16 maintain their substantial salaries and perquisites, all at the expense and to the detriment of the public shareholders of Cordis. 47. By the acts, transactions and courses of conduct alleged herein, the Individual Defendants, individually and as part of a common plan and scheme in breach of their fiduciary duties and obligations, are attempting unfairly to deprive plaintiffs and other members of the Class of the premium they could realize in an acquisition transaction and to ensure continuance of their positions as directors and officers, all to the detriment of Cordis' public shareholders. The Individual Defendants have been engaged in a wrongful effort to entrench themselves in their offices and positions of control and prevent the acquisition of Cordis except on terms which would further their own personal interests. 48. As a result of the actions of the Individual Defendants, plaintiffs and the other members of the Class have been and will be damaged in that they have not and will not receive their fair proportion of the value of Cordis's assets and businesses and/or have been and will be prevented from obtaining a fair and adequate price for their shares of Cordis's common stock. 49. Plaintiffs seek preliminary and permanent injunctive relief and declaratory relief preventing defendants from inequitably and unlawfully depriving - 15 - 17 plaintiffs and the Class of their rights to realize a full and fair value for their stock at a substantial premium over the market price, by unlawfully entrenching themselves in their positions of control, and to compel defendants to carry out their fiduciary duties to maximize shareholder value. 50. Only through the exercise of this Court's equitable powers can plaintiffs be fully protected from the immediate and irreparable injury which defendants' actions threaten to inflict. Defendants are precluding the shareholders' enjoyment of the full economic value of their investment by failing to proceed expeditiously and in good faith to evaluate and pursue a premium acquisition proposal which would provide consideration for all shares at a very attractive price. 51. Unless enjoined by the Court, defendants will continue to breach their fiduciary duties owed to plaintiffs and the members of the Class, and/or aid and abet and participate in such breaches of duty, and will prevent the sale of Cordis at a substantial premium, all to the irreparable harm of plaintiffs and other members of the Class. 52. Plaintiffs and the Class have not adequate remedy at law. - 16 - 18 WHEREFORE, plaintiffs demand judgment as follows: (a) Declaring this to be a proper class action and certifying plaintiffs as class representatives; (b) Declaring that defendants have violated Section 14(a) of the 1914 Act and Rule 14a-9 promulgated thereunder; (c) Declaring the election of the Company's directors at the Annual Meeting null and void as a result of their election on materially fraudulent proxy materials, and directing the appointment of a trustee to consider and respond to J&J's offer; (d) Declaring that defendants have breached their fiduciary duties to plaintiffs and the other members of the Class; (e) Ordering the Individual Defendants to carry out their fiduciary duties to plaintiffs and the other members of the Class by announcing their intention to: (i) cooperate fully with any entity or person, including J&J, having a bona fide interest in proposing any transactions which would maximize shareholder value, including but not limited to, a merger or acquisition or Cordis; (ii) immediately undertake an appropriate evaluation of Cordis's worth as a merger/acquisition candidate; - 17 - 19 (iii) take all appropriate steps to enhance Cordis's value and attractiveness as a merger/acquisition candidate; (iv) take all appropriate steps to effectively expose Cordis to the marketplace in an effort to create an active auction of the Company; (v) act independently so that the interests or the Company's public shareholders will be protected; and (vi) adequately ensure that no conflicts of interest exist between the Individual Defendants' own interest and their fiduciary obligation to maximize shareholder value or, in the event such conflicts exist, to ensure that all conflicts of interest are resolved in the best interests of the public shareholders of Cordis; (f) Ordering the Individual Defendants, jointly and severally to account to plaintiffs and the Class for all damages suffered and to be suffered by them as a result of the acts and transactions alleged herein, (g) Ordering defendants to use the Company's Poison Pill only in such a manner to maximize shareholder value; (h) Awarding plaintiffs the costs and disbursements of this action, including a reasonable allowance for plaintiffs' attorneys' and expert' fees; and - 18 - 20 (i) Granting such other and further relief as may be just and proper. JURY DEMAND Plaintiffs and the Class, pursuant to Fed. R. Civ. P. 38(b), hereby demand a trial by jury on all issues contained herein. Dated: October 20, 1995 HANZMAN CRIDEN KORGE HERTZBERG & CHAYKIN, P.A. By: /s/ Michael E. Criden ------------------------------------ Michael A. Hanzman, F.B.N. 510637 Michael E. Criden, F.B.N. 714356 2100 First Union Financial Center 200 South Biscayne Blvd. Miami, FL 33131 (305) 579-1222 LERNER & PEARCE, P.A. By: /s/ Robert W. Pearce ------------------------------------ Robert W. Pearce, F.D.N. 344575 2888 East Oakland Park Blvd. Fort Lauderdale, FL 33306 (305) 563-8111 Co-Liaison Attorneys for Plaintiffs Of Counsel: WECHSLER HARWOOD HALEBIAN & FEFFER LLP 805 Third Avenue New York, New York 10022 (212) 935-7400 GOODKIND LABATON RUDOFF & SUCHARON LLP 100 Park Avenue New York, New York 10017 (212) 907-0700 - 19 - EX-99.G3 4 COMPLAINT IN BRICKELL PARTNERS V. ROBT. C. STRAUSS 1 EXHIBIT (g)(3) 2 IN THE CIRCUIT COURT OF THE 11TH JUDICIAL CIRCUIT IN AND FOR DADE COUNTY, FLORIDA GENERAL JURISDICTION DIVISION CASE NO: 95-20617 BRICKELL PARTNERS THE ORIGINAL FILED a Florida Partnership, IN THE OFFICE OF Individually CLERK CIRCUIT COURT And On Behalf of All Others DADE CO. FLA. ON Similarly Situated, OCTOBER 19, 1995 Plaintiff, CLASS ACTION COMPLAINT - against - ROBERT C. STRAUSS, WILTON W. WEBSTER, ROBERT O. MARSTON, DAVID R. CHALLONER, RICHARD W. FOXEN, DONALD F. MALIN, JR., JAN VAN STEVENINICK, PATRICIA K. WOOLF, and CORDIS CORPORATION, Defendants. - -------------------------------------- Plaintiff, by its attorneys, alleges upon personal knowledge as to his own acts and upon information and belief as to all other matters, as follows: JURISDICTION AND VENUE 1. This is an action for injunctive relief and damages in excess of fifteen thousand ($15,000) dollars, exclusive of interest, costs, and attorneys fees. 2. Plaintiff Brickell Partners ("Brickell") is a partnership organized under the laws of the State of Florida, which is located in Miami, Dade County, Florida. A. Defendant Cordis Corporation ("Cordis" or the "Company") is a corporation organized under the laws of the State of Florida, with its principal place of business in Miami Lakes, 3 Dade County, Florida. NATURE OF THE ACTION 1. This is a stockholders' class action lawsuit brought on behalf of the public stockholders of Cordis Corp., who have been, and continue to be, deprived of the opportunity to realize fully the benefits of their investment in the Company. The individual defendants have wrongfully refused to properly consider a bona fide offer for the Company from Johnson & Johnson ("J&J"), and have taken a reactive defensive action, which was wrongfully designed to entrench Cordis officers and directors in their positions of control, and which was and is unreasonable in relation to any perceived threat posed by J&J's offer. In furtherance of these efforts, the individual defendants specifically adopted and implemented a Rights Agreement dated on or about October 16, 1995 (known in the parlance of the financial marketplace as a "Poison Pill"), which is designed to deter unsolicited acquisition offers by creating economic penalties for any person attempting to effect a business combination without approval of the individual defendants. As reported by the financial news media, the individual defendants have failed and refused to adequately consider the J&J offer. Their actions constitute unfair dealing and a breach of fiduciary duty to maximize shareholder value. The individual defendants are using their fiduciary positions of control over Cordis to thwart others in their legitimate attempts to acquire Cordis, and the individual defendants are trying to 2 4 entrench themselves in their positions with the Company. Parties 2. Plaintiff is and, at all relevant times, has been the owner of shares of Cordis common stock. 3. Cordis is a corporation duly organized and existing under the laws of the State of Florida. Cordis designs, manufactures and sells certain medical devices consisting of angiographic catheters, neuroscience devices and related instrumentation. Cordis maintains its principal executive offices at 14201 Northwest 60th Avenue, Miami Lakes, Florida. Cordis has approximately 16.4 million shares of common stock outstanding and hundreds of stockholders of record. Cordis' stock trades over the NASDAQ National Market System. 4. Defendant Robert C. Strauss ("Strauss") is and at all relevant times hereto has been the President, Chief Executive Officer, and a director of Cordis. 5. Wilton W. Webster ("Webster") is and at all relevant times hereto has been a Vice President and a director of Cordis. 6. Defendants Robert Q. Marston, David R. Challoner, Richard W. Foxen, Donald F. Malin, Jr., Jan Van Steveninick, and Patricia K. Woolf are directors of Cordis. 7. The defendants named in paragraphs 4 through 6 are hereinafter referred to as the "Individual Defendants." 8. Because of their positions as officers/directors of the Company, the Individual Defendants owe a fiduciary duty of loyalty and due care to plaintiff and the other members of the 3 5 class. 9. Each defendant herein is sued individually as a conspirator and aider and abettor, as well as in his/her capacity as an officer and/or director of the Company, and the liability of each arises from the fact that he or she has engaged in all or part of the unlawful acts, plans, schemes, or transactions complained of herein. CLASS ACTION ALLEGATIONS 10. Plaintiff brings this case in his own behalf and as a class action, pursuant to Rule 23 of the Rules of the Court of Chancery, on behalf of all stockholders of the Company, except defendants herein and any person, firm, trust, corporation, or other entity related to or affiliated with any of the defendants, or any of the Company's principal stockholders, who will be threatened with injury arising from defendants' actions as is described more fully below. 11. This action is properly maintainable as a class action. 12. The class is so numerous that joinder of all members is impracticable. The Company has thousands of stockholders who are scattered throughout the United States. 13. There are questions of law and fact common to the class that predominate over questions affecting any individual class member. The common questions include, inter alia, whether: a. defendants have breached their fiduciary duties owed by them to plaintiffs and other members of the Class by 4 6 failing and refusing to attempt in good faith to maximize shareholder value in the sale of Cordis; b. Cordis' Poison Pill was defensively enacted and implemented to entrench defendants in their office and deprive Cordis public shareholders of the maximum value of their holdings; c. defendants have breached or aided and abetted the breach of the fiduciary duties owed by them to plaintiffs and other members of the Class; d. defendants engaged in a plan and scheme to thwart and reject offers and proposals from third parties; including J&J; and (v) plaintiffs and the other members of the Class are being and will continue to be injured by the wrongful conduct alleged herein and, if so, what is the proper remedy and/or measure of damages. 14. Plaintiff is committed to prosecuting the action and has retained competent counsel experienced in litigation of this nature. Plaintiff's claims are typical of the claims of the other members of the class and plaintiff has the same interests as the other members of the class. Plaintiff is an adequate representative of the class. SUBSTANTIVE ALLEGATIONS 15. By the acts, transactions, and courses of conduct alleged herein, defendants, individually and as part of a common plan and scheme and/or aiding and abetting one another in total 5 7 disregard of their fiduciary duties, are attempting to deprive plaintiff and the Class unfairly of the opportunity to maximize the value of their investment in Cordis. 16. On October 19, 1995, the Dow Jones News Wire reported that J&J would commence "a $100-a-share cash tender offer for all of the outstanding stock of Cordis after Cordis rebuffed J&J's offer to negotiate a merger." The estimated value of the tender offer is $1.6 billion. 17. J&J announced that it had previously offered as much as $105-a-share in a stock-for-stock, tax-free transaction which was valued at $1.7 billion - or $100 million more than the tender offer. However, Cordis rejected this transaction and refused to negotiate with J&J. The $105 per share offering price represents a 22% premium over the trading price of Cordis stock on one day prior to announcement of the J&J tender offer. 18. As further evidence of defendants' intransigence, The Wall Street Journal reported on October 16, 1995, that the Individual Defendants had adopted and implemented a Poison Pill in anticipation of the J&J tender offer. Under the Plan, which is effective immediately, shareholders are given a dividend of one share purchase right ("Right") for each common share outstanding at the close of business on October 13, 1995 19. The adoption and implementation of the Poison Pill has the force and effect of entrenching the Individual Defendants in their corporate offices against any real or perceived threat to their control, and dramatically impairs the rights of Class members 6 8 to exercise freedom of choice in a proxy contest or to avail themselves of a bona fide offer to purchase their shares by an acquiror, such as J&J, unfavored by incumbent management. This fundamental shift of control of the Company's destiny from the hands of its shareholders to the hands of the Individual Defendants results in a heightened fiduciary duty of the Individual Defendants to consider, in good faith, a third party bid, such as J&J, and further requires the Individual Defendants to pursue a third party's interest in acquiring the Company and to negotiate in good faith with a bidder on behalf of the Company's shareholders. 20. The purpose, intent and effect of the Poison Pill, in the face of a pending offer for the Company, is to thwart, deter, impede, and delay the acquisition of Cordis by J&J. 21. Defendants' recalcitrance to consider and promptly act upon J&J's earlier overtures and formal offer has no valid business purpose, and simply evidences their disregard for the attractive premium being offered to Cordis shareholders. By failing to meet and negotiate or offer to meet and negotiate with J&J, defendants are depriving plaintiff and the Class of the right to share in the assets and businesses of Cordis and receive the maximum value for their shares. 22. Cordis represents a highly attractive acquisition candidate. Defendants' conduct would deprive Cordis' public shareholders of the very substantial control premium that J&J is prepared to pay, or of the enhanced premium which further negotiation or exposure of Cordis to the market could provide. 7 9 23. Defendants owe fundamental fiduciary obligations to Cordis's shareholders to take all necessary and appropriate steps to maximize the value of their shares. In addition, the Individual Defendants have the responsibility to act independently so that the interests of Cordis's public stockholders will be protected, to seriously consider all bona fide offers for the Company, and to conduct fair and active bidding procedures or other mechanisms for checking the market to assure that the highest possible price is achieved. Further, the directors or Cordis must adequately ensure that no conflict of interest exists between the Individual Defendants' own interests and their fiduciary obligations to maximize stockholder value or, if such conflicts exist, to insure that all such conflicts will be resolved in the best interests of the Company's shareholders. 24. Because defendants dominate and control the business and corporate affairs of Cordis and because they are in possession of private corporate information concerning Cordis's assets, businesses and future prospects, there exists an imbalance and disparity of knowledge of economic power between defendants and the public shareholders of Cordis. This discrepancy makes it grossly and inherently unfair for defendants to entrench themselves at the expense of its public shareholders. 25. The Individual Defendants have breached their fiduciary and other common law duties owed to plaintiffs and other members of the Class in that they have not and are not exercising independent business judgment and have acted and are acting to the 8 10 detriment of the Class. 36. In connection with the conduct described herein, the Individual Defendants breached their fiduciary duties by, among other things: a. rejecting the J&J proposal without fully informing themselves about or intentionally ignoring the future prospects of a combined Cordis/J&J company, or the intrinsic worth of Cordis; b. failing and refusing to meet with representatives of J&J; and c. erecting defensive measures such as Cordis' Poison Pill plan, which was designed to make it prohibitively expensive for an unapproved third party from acquiring the assets or control of the Company. 27. Moreover, defendants have refused to take those steps necessary to ensure that Cordis's shareholders will receive maximum value for their shares of Cordis stock. Defendants have thus refused to seriously consider the pending offer, and have failed to announce any active auction or open bidding procedures best calculated to maximize shareholder value in selling the Company. 28. The Individual Defendants are acting to entrench themselves in their offices and positions and maintain their substantial salaries and perquisites, all at the expense and to the 9 11 detriment of the public shareholders of Cordis. 29. By the acts, transactions and courses of conduct alleged herein, the Individual Defendants, individually and as part of a common plan and scheme in breach of their fiduciary duties and obligations, are attempting unfairly to deprive plaintiff and other members of the Class of the premium they could realize in an acquisition transaction and to ensure continuance of their positions as directors and officers, all to the detriment of Cordis' public shareholders. The Individual Defendants have been engaged in a wrongful effort to entrench themselves in their offices and positions of control and prevent the acquisition of Cordis except on terms which would further their own personal interests. 30. As a result of the actions of the Individual Defendants, plaintiffs and the other members of the Class have been and will be damaged in that they have not and will not receive their fair proportion of the value of Cordis's assets and businesses and/or have been and will be prevented from obtaining a fair and adequate price for their shares of Cordis's common stock. 31. Plaintiff seeks preliminary and permanent injunctive relief and declaratory relief preventing defendants from inequitably and unlawfully depriving plaintiff and the Class of their rights to realize a full and fair value for their stock at a substantial premium over the market price, by unlawfully entrenching themselves in their positions of control, and to compel defendants to carry out their fiduciary duties to maximize 10 12 shareholder value. 32. Only through the exercise of this Court's equitable powers can plaintiff be fully protected from the immediate and irreparable injury which defendants' actions threaten to inflict. Defendants are precluding the shareholders' enjoyment of the full economic value of their investment by failing to proceed expeditiously and in good faith to evaluate and pursue a premium acquisition proposal which would provide consideration for all shares at a very attractive price. 33. Unless enjoined by the Court, defendants will continue to breach their fiduciary duties owed to plaintiff and the members of the Class, and/or aid and abet and participate in such breaches of duty, and will prevent the sale of Cordis at a substantial premium, all to the irreparable harm of plaintiff and other members of the Class. 34. Plaintiff and the Class have no adequate remedy at law. WHEREFORE, plaintiff demands judgment as follows: (a) Declaring this to be a proper class action and certifying plaintiff as a class representative; (b) Ordering the Individual Defendants to carry out their fiduciary duties to plaintiff and the other members of the Class by announcing their intention to: (i) cooperate fully with any entity or person, including J&J, having a bona fide interest in proposing any transactions which would maximize shareholder value, including but 11 13 not limited to, a merger or acquisition of Cordis; (ii) immediately undertake an appropriate evaluation or Cordis's worth as a merger/acquisition candidate; (iii) take all appropriate steps to enhance Cordis's value and attractiveness as a merger/acquisition candidate; (iv) take all appropriate steps to effectively expose Cordis to the marketplace in an effort to create an active auction of the Company; (v) act independently so that the interests of the Company's public shareholders will be protected; and (vi) adequately ensure that no conflicts of interest exist between the Individual Defendants' own interest and their fiduciary obligation to maximize shareholder value or, in the event such conflicts exist, to ensure that all conflicts of interest are resolved in the best interests of the public shareholders of Cordis; (c) Ordering the Individual Defendants, jointly and severally to account to plaintiff and the Class for all damages suffered and to be suffered by them as a result of the acts and transactions alleged herein; (d) Preliminarily and permanently enjoining the implementation of the Company's Poison Pill; (e) Awarding plaintiff the costs and disbursements of this action, including a reasonable allowance for plaintiff's attorneys' and expert' fees; and 12 14 (f) Granting such other and further relief as may be just and proper. JURY DEMAND Plaintiff and the plaintiff class hereby demand a trial by jury on all issues contained herein. Dated: October 23, 1995 LERNER & PEARCE, P.A. By: ---------------------------- Robert W. Pearce 2888 East Oakland Park Blvd. Forth Lauderdale, FL 33306 (305) 563-8111 Attorneys for Plaintiff Of Counsel: WECHSLER HARWOOD HALEBIAN & FEFFER LLP 805 Third Avenue New York, New York 10022 (212) 935-7400 13 EX-99.G4 5 COMPLAINT IN HARRY LEWIS V. ROBERT C. STRAUSS 1 EXHIBIT (g)(4) 2 IN AND FOR THE CIRCUIT COURT FOR THE 11TH JUDICIAL CIRCUIT IN AND FOR DADE COUNTY, FLORIDA GENERAL JURISDICTION DIVISION CASE NO: HARRY LEWIS, on behalf of himself and all others similarly situated, Plaintiff, CLASS ACTION COMPLAINT - against - CORDIS CORP., DAVID R. CHALLONER, RICHARD W. FOXEN, DONALD F. MALIN, JR., JAN L. DE RUYTER VAN STEVENINCK, ROBERT C. STRAUSS, PATRICIA K. WOOLF, WILTON W. WEBSTER, JR., CATHERINE M. BURZIK and WILLIAM J. RAZZOUK, Defendants. ................................... Plaintiff alleges upon information and belief except as to paragraph 1, which is alleged on knowledge, as follows: THE PARTIES 1. Plaintiff is and at all times relevant hereto has been the owner of shares of the common stock of Cordis Corp. ("Cordis" or the "Company"). 2. Cordis is a corporation organized and existing under the laws of the State of Florida with offices 3 in Miami Lakes, Florida. Cordis has approximately 16 million shares of common stock issued and outstanding which trade on the NASDAQ national market system. 3. (a) Defendant Robert C. Strauss is and has been at all relevant times hereto the president, chief executive officer and Chairman of the Board of the Company. (b) Defendants David R. Challoner, Richard W. Foxen, Donald F. Malin, Jr., Jab L. de Ruyter van Steveninck, Patricia K. Woolf, Wilton W. Webster, Jr., Catherine M. Burzik and William J. Razzouk (together with Strauss, hereinafter referred to as the "Individual Defendants") are and at all relevant times hereto have been directors of the Company. 4. The Individual Defendants set forth above are officers and/or directors of Cordis and, as such, are in a fiduciary relationship with plaintiff and the other public stockholders of Cordis and owe to plaintiff and other members of the class the highest obligations of good faith, fair dealing and full disclosure. This obligation includes negotiating in good faith with potential bidders for the Company, and not placing their own interests and desires to maintain and entrench themselves in their positions over the interests of the public shareholders to obtain the highest possible price for their equity interests. -2- 4 CLASS ACTION ALLEGATIONS 5. Plaintiff brings this case on his own behalf and as a class action, pursuant to Rule 1.222 of the Florida Rules of the Civil Procedure, on behalf of all public stockholders of Cordis, and their successors in interest, who are or will be threatened with injury arising from defendants' actions as more fully described herein (the "Class"). Excluded from the Class are defendants herein and any person, firm, trust, corporation, or other entity related to or affiliated with any of the defendants. 6. This action is properly maintainable as a class action. 7. The class is so numerous that joinder of all members is impracticable. As of August 22, 1994, there were approximately 1,120 shareholders of record located throughout the United States. 8. There are questions of law and fact which are common to the class and which predominate over questions affecting any individual class member. 9. Plaintiff is committed to prosecuting this action and has retained competent counsel experienced in litigation of this nature. The claims of plaintiff are typical of the claims of other members of the class and plaintiff has the same interests as the other members of the class. Accordingly, plaintiff is an adequate representative -3- 5 of the class and will fairly and adequately protect the interests of the class. CLAIM FOR RELIEF 10. Cordis makes and markets angiographic devices, including catheters and related equipment, electrophysiology, radiology, intervential neuroradiology and neuroscience products. Cordis manufactures a line of catheters, for instance, often used to place Johnson & Johnson's ("J&J") stents in coronary arteries. 12. J&J is a major manufacturer and seller of a range of health care products. 13. In an October 19, 1995 news wire, J&J disclosed that, about a month ago, it had proposed to meet with Cordis to discuss a possible merger. The news wire further disclosed that, after its October 10 annual meeting, representatives of Cordis turned down the proposal. The proposal would have provided Cordis shareholders with a stock for stock transaction with an immediate worth of $105 per share, and an opportunity to participate in the appreciation which would result from the combined company. The total stock for stock proposal was estimated to be worth about $1.7 billion. 14. As a consequence of the Individual Defendants' failure to negotiate with J&J, on October 19, 1995, J&J announced that it intended to commence an all cash -4- 6 tender offer for all the outstanding shares of Cordis at $100 per share -- a transaction which has an estimated worth of only $1.6 billion, and precludes Cordis shareholders from being able to participate in the appreciation of their equity holdings which will occur when the entities are combined. 15. The Company has a poison pill plan enacted in 1986. At their Annual Meeting of Stockholders on October 10, 1995, the Company sought shareholder approval to amend its articles of incorporation to increase the number of authorized but unissued shares which could be issued in the event of a hostile offer (such as the J&J offer) to block such an offer. The increase of these shares was put before the shareholders for a vote on October 10th, after J&J had contacted Cordis with a potential merger proposal, but was rejected. Nevertheless, on or around October 16, 1995, Cordis' directors adopted a new shareholder rights plan supplanting the September 12, 1986 Plan. Cordis' newly implemented Shareholder Rights Plan was adopted to secure the Company against a hostile offer. 16. J&J has filed suit to force Cordis to revoke its rights plan. 17. The Individual Defendants have failed to negotiate in good faith with J&J and instead have continued to secure their positions of control over Cordis by failing to rescind the "poison pill," adopting further anti-takeover -5- 7 devices and rejecting out of hand, and without adequate negotiation or consideration, the J&J offer. 18. Cordis' poison pill and the Individual Defendants' rejection of the J&J offer, has the effect of entrenching the Individual Defendants in control of Cordis, and in response to the J&J proposal, the Individual Defendants have refused to rescind, waive or otherwise abolish the terms of the Cordis poison pill. 19. J&J's tender offer will be for 100% of Cordis' outstanding stock, which, in turn, will invoke the poison pill. This will make J&J's tender offer prohibitively expensive, may well discourage J&J from continuing its tender offer, and has resulted in J&J's commencing a suit against Cordis. 20. Defendants' failure to take rescind, waive or otherwise abolish the terms of the poison pill, to fail to negotiate with J&J and to increase Cordis' anti-takeover provisions constitutes a breach of defendants' fiduciary duties owed to plaintiff and other members of the Class. It will have the effect of making the J&J proposal cost-prohibitive, and therefore may discourage J&J from going forward with a tender offer--the primary alternative which would enable J&J shareholders to maximize the value of their equity holdings. 21. At all times herein, defendants were and are obligated to adequately consider, in a timely fashion and on -6- 8 an informed basis, any reasonable proposal from any party, not to place their own self-interests and personal considerations ahead of the interests of the stockholders and to make corporate decisions in good faith. The actions of the Individual Defendants in maintaining and refusing to waive or otherwise rescind the poison pill were fundamentally motivated to further their own self-interests and objectives, and correspondingly preserve and protect their emoluments and positions in the Company, all in violation of their fiduciary duties and to the detriment of the shareholders of the Company. 22. The Individual Defendants' entrenchment motives are evidenced by, inter alia, the following: (a) Through the maintenance of the poison pill, and defendants' failure to waive its terms, defendants have erected a virtually insurmountable barrier to persons who may wish to acquire Cordis, obtain control or take steps to maximize shareholder value, and are thereby attempting to entrench themselves in their positions of control and improperly advance their own personal agenda at the expense of Cordis' public stockholders; (b) In reality, the poison pill provisions are designed to prevent unsolicited takeovers from succeeding. Defendants' inaction concerning the waiver or rescission of the poison pill are indicative of their true motives and objectives; and -7- 9 (c) Defendants' efforts to increase Cordis' anti-takeover devices when confronted with a merger proposal and potential hostile takeover by J&J. 23. In failing to negotiate with J&J, increasing Cordis' anti-takeover devices, and failing to waive or rescind the poison pill, the Individual Defendants have acted to manipulate the corporate machinery of Cordis, thereby impairing the corporate democratic process within the Company at the expense and to the detriment of the Company's common stockholders. By maintaining the poison pill and increasing the Company's anti-takeover devices, the Individual Defendants have restrained and impaired the ability of Cordis' stockholders to affect corporate policy, and freely structure the directorial constituency of the Company. The poison pill, inter alia, impedes shareholder ability to accumulate shares and associate together to replace incumbent management, oppose any management initiative, or otherwise affect corporate policy through stockholder resolutions. 24. Defendants' fiduciary obligations require them to: (a) undertake an appropriate evaluation of any bona fide offers, and take appropriate steps to solicit all potential bids for the Company or its assets, consider strategic alternatives and maximize shareholder value; -8- 10 (b) act independently, including appointing a disinterested committee so that the interests of Cordis' public stockholders would be protected; (c) adequately ensure that no conflicts of interest exist between defendants' own interests and their fiduciary obligations to the public stockholders of Cordis; (d) waive or otherwise rescinding the Cordis poison pill so that the interests of Cordis' public stockholders will be protected. 25. Defendants have failed to dislcose whether they will negotiate with J&J to seek to maximize shareholder value, or attempt to pursue alternative transactions. 26. The J&J proposal represents an opportunity to effect a change of control of Cordis, its business and affairs. In a change of control transaction, the Individual Defendants necessarily and inherently suffer from a conflict of interest between their own personal desires to retain their offices in Cordis, with the emoluments and prestige which accompany those offices, and their fiduciary obligation to maximize shareholder value in a change of control transaction. Because of such conflict of interest, it is unlikely that defendants will be able to represent the interests of Cordis' public stockholders with the impartiality that their fiduciary duties require, nor will they be able to ensure that their conflicts of interest will -9- 11 be resolved in the best interests of Cordis' public stockholders. 27. By virtue of the acts and conduct alleged herein, the Individual Defendants, who direct the actions of the Company, are carrying out a preconceived plan and scheme to entrench themselves in office and to protect and advance their own proposal parochial interests at the expense of Cordis. Defendants' conduct has disenfranchised the Company's stockholders in their ability to exercise their right to vote for directors of their choice and to influence corporate policy through the proxy mechanism. 28. As a result of the foregoing, the Individual Defendants have breached and/or aided and abetted breaches of fiduciary duties owed to Cordis and its stockholders. 29. Unless enjoined by this Court, defendants will breach their fiduciary duties owed to plaintiff and the other members of the Class and may benefit themselves in their corporate offices, all to the irreparable harm of the Class, as aforesaid. 30. Plaintiff and the other members of the Class have no adequate remedy at law. WHEREFORE, plaintiff demands judgment as follows: (a) declaring this to be a proper class action; -10- 12 (b) ordering the Individual Defendants to carry out their fiduciary duties to plaintiff and the other members of the Class by announcing their intention to: (i) undertake an appropriate evaluation of alternatives designed to maximize value for Cordis' public stockholders; (ii) adequately ensure that no conflicts of interests exist between defendants' own interests and their fiduciary obligations to public stockholders or, if such conflicts exist, to ensure that all the conflicts would be resolved in the best interests of Cordis' public stockholders; and (iii) act independently by, inter alia, appointing a completely disinterested committee to review this and other alternatives, so that the interests of Cordis' public stockholders would be protected; (c) ordering defendants, jointly and severally, to account to plaintiff and the other members of the Class for all damages suffered and to be suffered by them as a result of the acts and transactions alleged herein; (d) declaring that the Individual Defendants and each of them have violated their fiduciary duties to the Class; (e) rescinding and rendering void the poison pill; -11- 13 (f) awarding plaintiff the costs and disbursements of the action, including a reasonable allowance for plaintiff's attorney's fees and experts' fees; and (g) granting such other and further relief as this Court may deem to be just and proper. Dated: October 19, 1995 HANZMAN CRIDEN KORGE HERTZBERG & CHAVKIN, P.A. 2100 First Union Financial Center 200 S. Biscayne Boulevard Miami, FL 33131 (305) 579-1222 Attorneys for Plaintiff Of Counsel: GOODKIND LABATAN RUDOFF & SUCHAROW LLP 100 Park Avenue New York, NY 10017 (212) 907-0700 -----END PRIVACY-ENHANCED MESSAGE-----