SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. _____)
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(as permitted by Rule 14a-6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Under Rule 14a-12
ICN Pharmaceuticals, Inc.
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(Name of Registrant as Specified in Its Charter)
ICN Committee to Maximize Shareholder Value
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2001 ANNUAL MEETING OF STOCKHOLDERS OF
ICN PHARMACEUTICALS, INC.
MAY 30, 2001
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PROXY STATEMENT OF
THE ICN COMMITTEE TO MAXIMIZE SHAREHOLDER VALUE
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This Proxy Statement (this "Proxy Statement") and the enclosed GOLD
proxy card are being furnished to you, the stockholders of ICN Pharmaceuticals,
Inc., a Delaware corporation ("ICN" or the "Company"), in connection with the
solicitation of proxies by SSP - Special Situations Partners Inc. ("SSP") and
Providence Capital, Inc. ("Providence") who are acting together with three
individuals to be nominated for election to the Board of Directors of ICN (the
"Board"), Edward A. Burkhardt, General Ronald R. Fogleman, United States Air
Force (Retired), and Steven J. Lee, as the ICN Committee to Maximize Shareholder
Value (the "Committee," "us" or "we") for use at the 2001 annual meeting of
stockholders of ICN, and at any adjournments or postponements thereof (the "2001
Annual Meeting").
The Committee is soliciting proxies to take the following actions at
the 2001 Annual Meeting:
(1) to elect Messrs. Burkhardt, Fogleman and Lee to the Board each to
serve until the 2004 annual meeting of ICN; and
(2) to transact other business properly brought before the 2001 Annual
Meeting.
ICN has announced that the 2001 Annual Meeting will be held at 10:00
a.m. P.D.T. on May 30, 2001. ICN has not yet announced the location of the 2001
Annual Meeting. The Committee anticipates that ICN's definitive proxy statement
for the 2001 Annual Meeting, when it becomes available, will contain the
location of the 2001 Annual Meeting. ICN has announced that the record date (the
"Record Date") for determining stockholders entitled to notice of and to vote at
the 2001 Annual Meeting was April 23, 2001.
As of the date of this Proxy Statement, the members of the Committee
are, in the aggregate, the record or beneficial owners of 3,539,300 shares of
common stock, par value $0.01 per share, of the Company (the "Common Stock"),
which represents approximately 4.4% of the issued and outstanding Common Stock
(80,618,070 shares as of April 23, 2001, based on information publicly disclosed
by the Company in its preliminary proxy statement for the 2001 Annual Meeting
dated April 30, 2001, filed with the Securities and Exchange Commission (the
"SEC") on April 30, 2001 (the "ICN 2001 Preliminary Proxy Statement")).
Additional information concerning the Committee and the other
participants in the solicitation is set forth under the heading "Information
Concerning the Participants in the Solicitation."
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The enclosed GOLD proxy card may be executed by holders of record as of
the Record Date. You are urged to sign and date the enclosed GOLD proxy card and
return it in the enclosed envelope whether or not you plan to attend the 2001
Annual Meeting. Your last dated proxy is the only one that counts, so return the
GOLD proxy card even if you delivered a prior proxy. We urge you not to return
any proxy card sent to you by the Company.
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MACKENZIE PARTNERS, INC.
156 Fifth Avenue
New York, NY 10010
email: proxy@mackenziepartners.com
Call Collect: (212) 929-5500
or Toll Free: (800) 322-2885
Facsimile: (212) 929-0308
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The date of this Proxy Statement is May 1, 2001. This Proxy
Statement is first being furnished to ICN stockholders on or about May 3,
2001.
INTRODUCTION
At the 2001 Annual Meeting three persons will be elected as directors
of ICN to hold office until the 2004 annual meeting and until their successors
have been elected and qualified or until their earlier death, resignation or
removal.
In accordance with ICN's Restated Certificate of Incorporation, SSP
has provided written notice to the Secretary of the Company of its intent to
nominate for election to the Board at the 2001 Annual Meeting, and is soliciting
your proxy in support of the election of, Edward A. Burkhardt, General Ronald R.
Fogleman, United States Air Force (Retired), and Steven J. Lee (the "Committee
Nominees"). We believe the Committee Nominees are highly qualified individuals
based on their extensive business and professional experience. For more
information regarding the Committee Nominees, see "The Election of Directors -
The Committee Nominees" below.
The Board currently consists of 14 directors divided into three
classes. According to the ICN 2001 Preliminary Proxy Statement, following the
2001 Annual Meeting, the Board will consist of 12 directors divided into three
classes. Under the terms of an agreement between SSP and ICN, dated October 19,
2000 (the "SSP Agreement") and the Company's Bylaws, the Company is required to
reduce the size of the Board to nine members by no later than the ICN 2002
annual meeting of stockholders (the "2002 Annual Meeting") and procure that the
directors elected at the 2001 Annual Meeting together with the directors elected
at the 2002 Annual Meeting will constitute at least two-thirds of the Board.
Although the Committee Nominees will not constitute a majority of the
Board if elected, we believe their election will send a strong message to ICN
and they will serve to closely monitor management's progress with respect to
enhancing stockholder value. By virtue of the terms of the SSP Agreement and the
Company's Bylaws, election of the Committee Nominees also will put stockholders
in the position to ensure that following the 2002 Annual Meeting the Board will
consist of a majority of directors nominated by ICN stockholders.
YOUR VOTE IS IMPORTANT SO PLEASE SIGN, DATE AND MAIL YOUR GOLD PROXY
CARD AT YOUR EARLIEST CONVENIENCE.
If you wish to communicate with us concerning ICN and the matters
discussed in this Proxy Statement, Eric Knight, Managing Director of SSP, can be
reached at 011-377-93-10-61-40 and Herbert A. Denton, President of Providence,
can be reached at (212) 888-3200. You can also contact us through the
Committee's website at http://www.icnmaxvalue.com.
If you have any questions concerning this Proxy Statement or need help
voting your shares, please call:
[Mackenzie Partners, Inc. logo]
MACKENZIE PARTNERS, INC.
156 Fifth Avenue
New York, NY 10010
email: proxy@mackenziepartners.com
Call Collect: (212) 929-5500
or Toll Free: (800) 322-2885
Facsimile: (212) 929-0308
WHY ARE WE SEEKING TO ELECT
THE COMMITTEE NOMINEES?
The Committee
SSP, founded in 1994, is a privately owned firm which invests in
publicly traded securities of companies it believes are substantially
undervalued by the market, and works with the stockholders and management of
such companies to maximize stockholder value. SSP's Chairman and controlling
stockholder is Dr. Tito Tettamanti, a Swiss investor and industrialist. SSP has
been a substantial stockholder of ICN since late 1999.
Providence Capital is an independent NASD-registered broker-dealer
and investment bank specializing in corporate governance and stockholder
matters. Providence was founded in 1991 and is based in New York City.
Providence's president is Herbert A. Denton.
The members of the Committee (SSP, Providence and their three nominees)
own 3,539,300 shares of ICN, representing approximately 4.4% of the outstanding
ICN shares, an investment with a market value as of April 30, 2001 of over
$90 million.
Background
We believe that ICN's shares trade at a significant discount - perhaps
as much as 50% - to ICN's intrinsic value.
ICN and its Chairman, Milan Panic, have repeatedly made clear over the
last several years that they share our view that ICN is undervalued.1
Shareholders have recently also been told by ICN management (in an ICN press
release dated April 3, 2001) that ICN has "valuable strategic assets and a
bright future" - which we accept and take for granted. Why then have ICN's
shares been so undervalued for so long?
It is our opinion that the market's persistent undervaluation of ICN
results directly from ICN's corporate structure - which leaves investors in ICN
exposed to Eastern Europe risk - and from a lack of confidence in the leadership
of ICN's founder and Chairman, Milan Panic. We also believe that the incumbent
Board is not sufficiently independent of Mr. Panic and has not adequately
represented stockholders' interests.
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1 "[W]e believe [ICN]'s stock price is significantly undervalued." (Mr.
Panic, in an ICN press release dated September 1, 1998, announcing a stock
repurchase program).
"[W]e agree with [SSP] that ICN shares are undervalued." (Mr. Panic, in an
ICN press release dated November 15, 1999, commenting on the filing of
SSP's initial Schedule 13D).
"[Mr. Panic] deemed the current market price for ICN stock to be
undervalued in the marketplace." (An ICN press release dated December 13,
2000, announcing that Mr. Panic had chosen not to engage in a previously
disclosed sale of ICN shares).
The "value that is inherent in ICN" is "inadequately recognized under
[ICN's] present structure." (Mr. Panic in a letter to ICN stockholders
dated March 20, 2001).
We are of the view that the correct solution for realizing the value in
ICN is to divide ICN into three completely separate companies, each of which is
independently managed and has a truly independent board of directors - with a
much reduced role for Mr. Panic.
This is the approach reflected in the restructuring plan announced by
ICN as part of the SSP Agreement signed on October 19, 2000.
We find, however, that the incumbent management and board of directors
of ICN have failed to make genuine progress in implementing the above-mentioned
plan and that their latest "revisions," announced last month, raise the specter
of a significant retrenchment from their public commitments.
These issues leave us with serious doubts as to the ability and
willingness of the Company's incumbent management and board of directors to put
the promised restructuring plan into effect and follow it to completion in a
timely way. The pressure of scrutiny from directors who have been nominated by
stockholders and who are wholly independent of incumbent management is, in our
view, necessary to effectuate the prompt pursuit of increased stockholder value.
ICN's June Plan and the Market Reaction
Through public statements and in meetings with the directors and
management of ICN, SSP has actively encouraged ICN to take steps to address this
situation since late 1999.
In a press release dated February 24, 2000, ICN announced that it had
engaged investment bankers "to explore strategic alternatives in order to
increase shareholder value," and on June 15, 2000, in a further press release,
having concluded that dividing ICN into three separate public companies "would
unlock the value of the components," ICN announced a plan to reorganize itself
through initial public offerings of minority interests in two of its business
units, Ribapharm and ICN International.
Critically, ICN's June plan would have left Ribapharm and ICN
International as consolidated, majority-owned subsidiaries of ICN, under the
control of ICN's current management. Mr. Panic was to have been the chairman of
all three companies and the chief executive officer of ICN.
In the three trading days that followed the announcement of this plan,
ICN's closing share price fell by 25% - from $34-5/16 on June 14 to $25-3/4 on
June 19 - a loss of almost $700 million in market value for ICN stockholders.
There is no doubt in our minds that ICN's June plan was soundly
rejected by the market for failing to address what we believe are the main
causes of ICN's chronic undervaluation:
1. Milan Panic's leadership - under the June plan, as CEO of the
parent company, Mr. Panic would have remained effectively "at the
helm" of all three companies.
2. ICN's exposure to Eastern Europe - under the June plan, ICN
International (with its Eastern European operations) would have
remained a consolidated subsidiary of ICN.
SSP's Alternative and ICN's October Commitments
Following ICN's announcement of its June plan, SSP urged ICN's
management to consider an alternative approach that would address these issues.
SSP proposed a 100% separation of ICN's three business units into fully separate
companies, each with independent boards and management, by means of tax-free
"spin-offs" to ICN's stockholders.
SSP also disclosed publicly that it was considering whether to nominate
a slate of directors at ICN's 2000 annual meeting of stockholders.
In October 2000, on the eve of the deadline for stockholder
nominations, with no elements of its June plan having been realized, ICN signed
the SSP Agreement. In exchange for SSP's agreement not to nominate directors at
the 2000 annual meeting, ICN agreed to terms securing two important benefits for
ICN stockholders: (A) a public commitment from ICN's Board to a revised
restructuring plan reflecting the key elements of SSP's proposal, and (B) a
means for ICN stockholders to enforce that commitment through the exercise of
their franchise if in their view sufficient progress is not made.
(A) ICN's October commitment to its stockholders
In a press release issued on October 20, 2000 as part of its agreement
with SSP ("ICN's October 20 Press Release"), in addition to reaffirming its
intention to proceed with initial public offerings of minority interests in
Ribapharm and ICN International, ICN announced significant revisions to its
plan, informing stockholders that:
o ICN's Board was committed to ensuring that ICN, Ribapharm and ICN
International would be completely separated from each other as soon
as possible with separate managements and truly independent Boards;
o ICN's Board was committed to accomplish this separation through
tax-free distributions to the ICN stockholders of ICN's entire
remaining interest in Ribapharm and ICN International;
o ICN's Board was committed to consider, in the exercise of its
fiduciary duties, other strategic transactions, including a sale of
part or all of ICN, that would provide alternative means to
increase stockholder value;
o ICN's Board would immediately initiate an internal and external
search for a CEO for ICN (to be renamed ICN Americas); and
o Mr. Panic would assume a reduced management role by relinquishing
all management or board positions at Ribapharm and serving only as
a non-executive chairman of ICN Americas. He would remain chairman
and CEO only of ICN International.
(B) Enforcement of ICN's October commitment
As a means for SSP and the ICN stockholders to enforce ICN's public
commitments, ICN agreed with SSP to hold the 2001 Annual Meeting by May 30, 2001
and its 2002 annual meeting by May 29, 2002 and to reduce the size of its Board
to nine. The SSP Agreement also requires ICN to ensure that the directors
elected at those two meetings will constitute at least two-thirds of the entire
Board in May 2002.
These agreements, now also reflected in ICN's Bylaws, provide ICN
stockholders with the means to nominate and elect stockholder-nominated
directors as a majority of the Board within the next fourteen months.
Why Are We Concerned?
We are concerned because we believe the incumbent management and
directors of ICN, after months and months of talk and promises, have not, in
fact, made genuine progress in splitting ICN into three wholly-separate and
independently-managed businesses to address the undervaluation of ICN or to
enhance stockholder value.
Despite the protestations of ICN and its Chairman that they remain
committed to implementing a restructuring, almost one year has passed and the
promised restructuring of ICN not only remains unfinished, it has to a large
extent not even begun.
As of today, ICN has not delivered to its stockholders any tangible
results from its October commitments. ICN has not delivered on its commitment of
a tax-free distribution of Ribapharm and ICN International shares. ICN has not
delivered on its commitment to independent management and management changes.
ICN has not delivered any alternative strategic transaction. And, no surprise to
us, ICN shares remain chronically undervalued. ICN's share price today is below
the prices immediately prior to both the June 15 and October 20 announcements.
We are unconvinced and unimpressed by the litany of steps that Mr.
Panic proudly presented as a "progress" report to the stockholders in March.
Many of these items were old news - dating back to last August or before. Others
are merely repetitions of previous statements about ICN's "intentions" and
"proposals."
We believe that other investors are equally unimpressed and skeptical.
Following the announcement of the SSP Agreement and the October plan, ICN shares
traded at prices as high as $41.75 on October 20, 2000 - their highest level
since July 1998. Since then, the shares have returned to the levels which first
led SSP to speak out.
We are concerned because we no longer believe Mr. Panic and ICN's
incumbent Board intend to deliver on their October commitments.
On March 8, 2001, in a press release and letter to stockholders, ICN
announced a revised structure for the offering of ICN International, now to be
comprised of up to 40 percent of ICN International. According to the
announcement, this offering is expected to be completed, "subject to market
conditions," in the second quarter of 2001.
The increased size of the proposed ICN International offering
effectively scraps any possibility under current U.S. tax law of a subsequent
tax-free distribution to stockholders of the remainder of that company. Indeed,
ICN now says merely that it has a "longer-term intention" to sell its remaining
stake.
Similarly, the public offering of Ribapharm is now to occur only
sometime in 2001, again with the reservation "subject to market conditions."
In the meantime - however long that may be - ICN (still led by Mr.
Panic and supervised by the incumbent Board) will continue to control both
Ribapharm and ICN International.
This appears to be just the result management intends. In a press
release issued on April 3, 2001, ICN said "ICN has valuable strategic assets and
a bright future and these are best managed under ICN's existing board of
directors, and the management which has been responsible for the growth of the
company."
We are concerned because ICN's March and April communications
studiously avoid any mention whatsoever of last October's commitment to
"ensur[e] that each of these three companies be completely separated from the
others as soon as possible, with separate managements and truly independent
boards" and because Mr. Panic's March letter to stockholders ominously refers
back to the announcement of the June restructuring plan and makes no reference
to the revised October plan.
We are concerned and puzzled that Mr. Panic has indicated an intention
to sell stock when ICN is supposedly in the process of a strategic restructuring
- whose execution is under Mr. Panic's control - designed to promote a higher
stockholder value. On April 5, 2001, Mr. Panic gave notice of an intent to sell
100,000 ICN shares.
We are concerned because we believe ICN's incumbent directors are less
independent of Mr. Panic and senior management than is desirable. We believe
this primarily because none of the members of ICN's incumbent Board were
nominated by ICN stockholders, and ten of the fourteen incumbent directors
have served on the Board since 1992 or before. We further believe this because
of the directors' unusually high compensation and a history of consulting
arrangements between certain directors and ICN (as reported in The Wall Street
Journal on April 6, 2000).
Our fellow stockholders evidently also share this concern. At ICN's
2000 annual meeting, a mere four months ago, ICN stockholders approved by a wide
majority of votes the resolution offered by TIAA-CREF expressing the view that
ICN's board structure and composition raises "serious questions" about the
Board's capacity to act independently of management. The incumbent Board opposed
this resolution.
Serious Questions
We are left - and we think many of our fellow stockholders are left -
with serious questions and doubts.
o Does ICN's Board remain committed, as it stated in ICN's October 20
Press Release, to "ensuring that each of [ICN, Ribapharm and ICN
International] be completely separated from the others as soon as
possible with separate managements and truly independent Boards?"
o Will investors recognize the full value of ICN's businesses so long
as they remain under the ultimate control of ICN's incumbent
management supervised by its incumbent Board?
o If market conditions preclude long-promised public offerings of
these companies, why won't ICN move forward by seeking the
required consent of, or repaying or refinancing, its public
senior debt and distributing 100% of Ribapharm to ICN
stockholders?
o What contingency measures, if any, are being planned by ICN's
management to, as Mr. Panic put it in his letter to stockholders
dated March 20, 2001, "unlock the value of ICN's businesses" and
increase stockholder value in the event market conditions counsel
against the planned offerings or if the conditions to a tax-free
distribution of Ribapharm are not satisfied?
o What has become of ICN's commitment, as it stated in ICN's October
20 Press Release, to consider, "should the break-up plan not be
fully implemented," alternative transactions, including a sale of
part or all of ICN?
o Do ICN's incumbent management and Board possess the ability or will
to pursue a restructuring to timely completion and maximize value
for stockholders?
o When, if ever, does Milan Panic intend to relinquish the reins at
any of ICN's businesses?
Why We Are Nominating Now
At the time SSP agreed not to pursue a proxy fight at the 2000 annual
meeting, it obtained agreements from ICN about the timing of the next two annual
meetings and the size of the Board, expressly to provide a means to enforce
ICN's public commitments regarding the restructuring plan, other strategic
alternatives and the future management of ICN's businesses.
The "enforcement mechanism" obtained by SSP in the SSP Agreement was
ICN's agreement to hold its next two annual meetings at dates certain and to fix
the number of directors to be elected at each such meeting. These terms assure
that two-thirds of the Company's directors will stand for election between now
and May 2002 (without risk of either changes in the size of the board or delay
in holding meetings - remembering that 16 months elapsed between ICN's 1998 and
1999 annual meetings and 15 months between the 1999 and 2000 meetings).
These agreements gave ICN stockholders dissatisfied with ICN's
incumbent management and Board the opportunity, if they choose to pursue it (as
the Committee is doing this year), to seek to elect to the Board, initially a
minority and within a set time period, a majority of stockholder-nominated
directors.
For the reasons described above, we now feel obligated to put that
mechanism to use, on behalf of all stockholders of ICN, and to elect to the
Board a group of directors who have been nominated by stockholders, are wholly
independent of management and are dedicated to the prompt pursuit of increased
stockholder value.
For these reasons we will nominate the Committee Nominees and are
asking you to elect them to the Board.
What Will Our Nominees Do?
The Committee Nominees are men of substantial business experience and
integrity. They are wholly independent of Mr. Panic and ICN's current management
and are committed to the maximization of stockholder value, through the proposed
restructuring or by other means, as soon as practicable. See "The Election of
Directors - The Committee Nominees" below.
The Committee Nominees have personally invested in excess of $6 million
in ICN shares and their interests are closely aligned with those of ICN's other
stockholders.
If elected, the Committee Nominees are committed to acting in the best
interest of ICN's stockholders and, subject to their fiduciary duties as
directors of ICN, will pursue diligently and promptly the proposed restructuring
or other actions to maximize stockholder value. If elected, the Committee
Nominees will not stand for further unnecessary delay and will act as an
effective watchdog for the stockholders.
Because ICN has a classified Board structure, if elected, the Committee
Nominees will not constitute a majority of the Board. However, from their
position on the Board, the Committee Nominees will be able to closely monitor
management's progress with respect to enhancing stockholder value. Their
presence on the Board, and the action of the stockholders in electing them to
the Board, will send a strong message to ICN and the remaining directors
regarding the desire of ICN's stockholders to have truly independent,
stockholder-nominated representatives on the Board and the seriousness with
which ICN stockholders take the Board's prior commitments regarding the
enhancement of stockholder value.
Equally important is the fact that, as a result of SSP's agreement with
ICN, if all of the Committee Nominees are elected at the 2001 Annual Meeting,
then the Committee or other interested stockholders would be in a position at
ICN's 2002 Annual Meeting to propose sufficient additional nominees to ensure
that, if elected, a majority of the Board would consist of directors nominated
directly by ICN's stockholders. This is the only sanction available to
stockholders if ICN's Board and management ultimately fail to deliver on their
promises.
* * *
We urge you to sign, date and return the enclosed GOLD proxy card (and
not to return any proxy card sent to you by the Company) to help us pursue these
objectives.
THE ELECTION OF DIRECTORS
The Board currently consists of 14 directors divided into three
classes. According to the ICN 2001 Preliminary Proxy Statement, following the
2001 Annual Meeting, the Board will consist of 12 directors divided into three
classes. At the 2001 Annual Meeting three persons will be elected as directors
of ICN to hold office until the 2004 annual meeting and until their successors
have been elected and qualified or until their earlier death, resignation or
removal. In accordance with ICN's Restated Certificate of Incorporation, SSP has
provided written notice to the Secretary of the Company of its intent to
nominate the Committee Nominees for election to the Board at the 2001 Annual
Meeting.
The Committee Nominees are Edward A. Burkhardt, General Ronald R.
Fogleman, United States Air Force (Retired), and Steven J. Lee. We believe the
Committee Nominees are highly qualified individuals based on their extensive
business and professional experience.
The Committee Nominees
The Committee proposes that the ICN stockholders elect the Committee
Nominees to the Board at the 2001 Annual Meeting. The three Committee Nominees
and certain information concerning their principal occupations or employment,
beneficial ownership of Common Stock as of the date of this Proxy Statement, and
other matters is set forth below. This information has been furnished to the
Committee by the respective Committee Nominees.
Name; Age; and Business Principal Occupation and Business Experience Number of Percentage
Address During Last Five Years; Current Directorships Shares of of Common
Common Stock Stock (1)
Beneficially
Owned
Edward A. Burkhardt; 62; Mr. Burkhardt has been the President of Rail World, 250,000 *
8600 W. Bryn Mawr Ave. Inc., a railway management consulting and investment
Suite 500N corporation specializing in privatizations, since
Chicago, IL 60631-3579 August 1999. From 1987 though August 1999, Mr.
Burkhardt held a number of positions with
Wisconsin Central Transportation Corporation,
including Chairman, President and Chief
Executive Officer. Wisconsin Central
Transportation Corporation is a holding company
which operates a regional North American rail
system in Wisconsin, Michigan, Illinois,
Minnesota and Ontario. Wisconsin Central
Transportation Corporation also owns minority
interests in, and participates in the
management of, rail operations in the United
Kingdom and Australia, as well as ferry and
rail operations in New Zealand.
Ronald R. Fogleman; 59; General Ronald R. Fogleman, United States Air Force 1,000 *
406 Snowcap Lane (Retired), has been the President and Chief
Durango, CO 81303 Executive Officer of Durango Aerospace, Inc., an
international aviation consulting services
company, since 1998. Prior to joining Durango
Aerospace, General Fogleman, who retired from
the United States Air Force in September 1997,
served as Chief of Staff of the United States
Air Force from 1994 until 1997 and as
Commander-in-Chief of the United States
Transportation Command from 1992 until 1994.
General Fogleman currently serves on the Board
of Directors of North American Airlines, a
feeder airline for El Al; Rolls Royce of North
America; the International Airline Support
Group, Inc.; Mesa Air Group, Inc.; and World
Airways, Inc.
Steven J. Lee; 53; Mr. Lee has been Chairman and Chief Executive 25,000 *
c/o PolyMedica Corporation Officer of PolyMedica Corporation since June 1996.
11 State Street From 1990 to 1996, he was President and Chief
Woburn, MA 01801 Executive Officer of PolyMedica. PolyMedica is a
national medical products and services company.
Through its Liberty Medical Supply subsidiary, it is
the largest value-added provider of diabetic
supplies to Medicare-eligible seniors. Mr. Lee is
also a director of Kensey Nash Corporation.
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* Denotes ownership of less than 1% of the outstanding shares of Common Stock.
(1) This percentage is calculated using 80,618,070 shares of Common Stock
outstanding as of April 23, 2001, based on information publicly disclosed
by the Company in the ICN 2001 Preliminary Proxy Statement.
The Committee Nominees will not receive any compensation from the
Committee for agreeing to be nominated by the Committee or, if elected, for
their services as directors of the Company. However, the Committee has agreed to
indemnify each of the Committee Nominees against losses incurred arising out of
or based upon being the Committee's nominee or a "participant in a
solicitation." The Committee also has agreed to reimburse each of the Committee
Nominees for their reasonable legal fees and expenses incurred in connection
with each such nominee's participation in the solicitation of proxies as
described in this Proxy Statement.
The Committee expects that each of the Committee Nominees, if elected,
will receive the Company's customary director's compensation. According to the
ICN 2001 Preliminary Proxy Statement, under compensation arrangements then in
effect, non-employee members of the Board were paid an annual fee of $30,000,
payable quarterly, plus a fee of $1,000 for every Board meeting attended and an
additional fee of $1,000 for every committee meeting attended. In addition,
Board members were reimbursed for their out-of-pocket expenses in attending the
meetings. Non-employee directors on each April 18 also were granted options to
purchase 15,000 shares of Common Stock. The Committee also expects that each of
the Committee Nominees, if elected, will be indemnified for his services as
director of the Company to the same extent indemnification is available to
directors of the Company under the Company's Restated Certificate of
Incorporation or otherwise provided by the Company. In addition, the Committee
expects that, upon their election, such nominees will be covered by the
Company's officer and director liability insurance, assuming the Company has in
effect a standard officer and director insurance policy.
Although the Committee has no reason to believe that any Committee
Nominee will be unable to serve as a director, if any one or more of the
Committee Nominees shall not be available for election, the persons to be
appointed as proxies shall vote all proxies received by the Committee for the
election of any additional nominees as may be proposed by the Committee. If
required, the Committee intends to distribute to the stockholders of the Company
supplemental materials. In addition, the Committee reserves the right to
nominate substitute or additional persons if the Company makes or announces any
other action that has, or if consummated would have, the effect of disqualifying
any of the Committee Nominees. You are urged to carefully consider the Committee
Nominees' qualifications and abilities to represent your interests.
* * *
WHEN YOU RETURN THE GOLD PROXY CARD YOU WILL BE VOTING FOR THE
COMMITTEE NOMINEES TO SERVE AS DIRECTORS, UNLESS YOU APPROPRIATELY MARK YOUR
CARD OTHERWISE.
THE COMMITTEE BELIEVES THAT IT IS IN THE BEST INTEREST OF STOCKHOLDERS
TO ELECT THE COMMITTEE NOMINEES AT THE 2001 ANNUAL MEETING, AND STRONGLY
RECOMMENDS A VOTE "FOR" THE ELECTION OF THE COMMITTEE NOMINEES.
* * *
YOUR VOTE IS IMPORTANT REGARDLESS OF THE NUMBER OF SHARES YOU OWN.
PLEASE SIGN AND DATE THE GOLD PROXY CARD AND RETURN IT IN THE ENCLOSED
ENVELOPE WHETHER OR NOT YOU PLAN TO ATTEND THE 2001 ANNUAL MEETING.
VOTING PROCEDURES
2001 Annual Meeting
The Company has announced that the 2001 Annual Meeting will be held at
10:00 a.m. P.D.T. on May 30, 2001. The Company has not yet announced the
location of the 2001 Annual Meeting. The Committee anticipates that ICN's
definitive proxy statement for the 2001 Annual Meeting, when it becomes
available, will contain the location of the 2001 Annual Meeting.
Voting and Revocation of Proxies
For the proxy solicited hereby to be voted, the enclosed GOLD proxy
card must be signed, dated, and returned to the ICN Committee to Maximize
Shareholder Value c/o MacKenzie Partners, Inc. ("MacKenzie Partners") at the
address set forth on the back page of this Proxy Statement, in the enclosed
envelope, in time to be voted at the 2001 Annual Meeting. If you wish to vote
"FOR" the Committee Nominees you must submit the enclosed GOLD proxy card and
must NOT submit the Company's proxy card. If you have already returned the
Company's proxy card, you have the right to revoke it as to all matters covered
thereby and may do so by subsequently signing, dating, and mailing the enclosed
GOLD proxy card. ONLY YOUR LATEST DATED PROXY WILL COUNT AT THE 2001 ANNUAL
MEETING. Execution of a GOLD proxy card will not affect your right to attend the
2001 Annual Meeting and to vote in person.
Any proxy may be revoked as to all matters covered thereby at any time
prior to the time a vote is taken by (i) submitting to the Chairman of the Board
or us a later dated written revocation or duly executed proxy; or (ii) attending
and voting at the 2001 Annual Meeting in person (attendance at the 2001 Annual
Meeting will not in and of itself constitute a revocation).
Although a revocation will be effective if delivered only to the
Company, the Committee requests that either the original or a copy of all
revocations be mailed to the ICN Committee to Maximize Shareholder Value c/o
MacKenzie Partners at the address set forth on the back page of this Proxy
Statement, so that the Committee will be aware of all revocations and can more
accurately determine if and when the requisite proxies have been received.
Shares of Common Stock represented by a valid, unrevoked GOLD proxy
card will be voted as specified. Shares represented by a GOLD proxy card where
no specification has been made will be voted "FOR" the Committee Nominees.
Except as set forth in this Proxy Statement, the Committee is not aware of any
other matter to be considered at the 2001 Annual Meeting. If you return a GOLD
proxy card and any other matter is presented at the 2001 Annual Meeting, the
persons named on the enclosed GOLD proxy card will vote your shares in
accordance with their best judgment concerning such matter.
If any of your shares were held in the name of a brokerage firm, bank,
bank nominee or other institution on April 23, 2001, the Record Date, only that
institution can vote your shares and only upon its receipt of your specific
instructions. Accordingly, please promptly contact the person responsible for
your account at such institution and instruct that person to execute and return
the GOLD proxy card on your behalf. You should also promptly sign, date and mail
the voting instruction form (or GOLD proxy card) that your broker or banker
sends you. Please do this for each account you maintain to ensure that all of
your shares are voted. If any of your shares were held in the name of a
brokerage firm, bank, bank nominee or other institution on the Record Date, to
revoke your proxy you will need to give appropriate instructions to such
institution. IF YOU DO NOT GIVE INSTRUCTIONS TO YOUR BROKER OR OTHER NOMINEE,
YOUR SHARES WILL NOT BE VOTED.
Record Date and Voting Power
Only holders of record as of the close of business on April 23, 2001,
the Record Date for the 2001 Annual Meeting, will be entitled to vote at the
2001 Annual Meeting. If you were a stockholder of record on the Record Date, you
will retain your voting rights for the 2001 Annual Meeting even if you sell such
shares after the Record Date. Accordingly, it is important that you vote the
shares you owned on the Record Date or grant a proxy to vote such shares, even
if you sell some or all of your shares after the Record Date.
The shares of Common Stock are the only shares of capital stock of ICN
entitled to notice of, and to vote at, the 2001 Annual Meeting. According to
publicly filed information, as of April 23, 2001, the Record Date, there were
80,618,070 shares of Common Stock issued and outstanding held of record by
approximately 7,287 stockholders. Every holder of shares of Common Stock is
entitled to one (1) vote for each share of Common Stock held.
Quorum and Required Vote
In accordance with ICN's Bylaws, at the 2001 Annual Meeting, a majority
of the shares of Common Stock issued and outstanding and entitled to vote
thereat, present in person or represented by proxy, shall constitute a quorum.
For the election of directors, nominees receiving a plurality of the votes cast
at the 2001 Annual Meeting in person or by proxy will be elected as directors.
"Plurality" means the nominees who receive the largest number of votes cast.
Shares not voted will have no effect on the election of directors. Abstentions
and broker non-votes in connection with the election of directors shall have no
effect on such matters since directors are elected by a plurality of the votes
cast at the 2001 Annual Meeting. "Broker non-votes" are shares as to which a
broker indicates on a proxy that it does not have discretionary authority and
has not received voting instructions from the beneficial owner on a particular
matter. Given that this is a contested election, we do not expect that there
will be any broker non-votes.
Inspectors of election that are appointed by the Board or, if no such
appointment is made or such inspectors fail to appear or act, by the chairman of
the 2001 Annual Meeting (appointed in accordance with the Bylaws of the
Company), will tabulate the votes cast at the 2001 Annual Meeting.
If you have questions, or need further assistance, please call
MacKenzie Partners at (800) 322-2885 (toll-free) or at (212) 929-5500 (call
collect). You may also send an email to proxy@mackenziepartners.com.
SOLICITATION OF PROXIES
In connection with the Committee's solicitation of proxies for use at
the 2001 Annual Meeting, proxies may be solicited by mail, courier service,
advertisement, telephone, telecopier or other electronic means, and in person.
Solicitations may be made, in the manner set forth in this Proxy Statement, by
SSP's and Providence's directors, managers, officers and other employees, and by
the Committee Nominees, none of whom will receive additional compensation for
such solicitations. We may request banks, brokerage firms, and other custodians,
nominees and fiduciaries to forward all of the solicitation materials to the
beneficial owners of the shares of Common Stock they hold of record. We will
reimburse these record holders for customary clerical and mailing expenses
incurred by them in forwarding these materials to their customers.
We have retained MacKenzie Partners for solicitation and advisory
services in connection with the solicitation of proxies at an estimated fee of
$200,000, together with reimbursement for its reasonable out-of-pocket
expenses. MacKenzie Partners has informed us that it would employ up to
approximately 31 persons to solicit proxies for use at the 2001 Annual
Meeting.
All expenses associated with any solicitation of proxies by us in
connection with the 2001 Annual Meeting will be borne directly by the Committee.
SSP and Providence shall bear all expenses incurred on behalf of the Committee.
If the Committee Nominees are elected to the Board, the Committee intends to
seek reimbursement of the costs of this solicitation from the Company. Unless
otherwise required by law, the Committee does not currently intend to submit the
question of reimbursement of the costs of this solicitation to a stockholder
vote. We estimate that the costs incidental to our solicitation of proxies,
including expenditures for advertising, printing, postage, legal and related
expenses will be approximately $900,000. Total costs incurred to the date of
this Proxy Statement by us have been approximately $300,000.
INFORMATION CONCERNING THE
PARTICIPANTS IN THE SOLICITATION
The Committee; SSP; Providence; Eric Knight, Managing Director of SSP;
Dr. Tito Tettamanti, Chairman of SSP; Herbert A. Denton, President of
Providence; Richard E. Lazarow, Managing Director of Providence; John J. Hill, a
financial analyst with Providence; Edward A. Burkhardt, a Committee Nominee;
General Ronald R. Fogleman, United States Air Force (Retired), a Committee
Nominee; and Steven J. Lee, a Committee Nominee; may each be deemed a
"participant" in the solicitation contemplated by this Proxy Statement, as the
term "participant" is defined in the proxy rules promulgated by the SEC under
the Securities Exchange Act of 1934, as amended (the "Exchange Act") (each such
person, a "Participant," and collectively, the "Participants"). Information
concerning the Participants is set forth below and on Schedule I hereto, and
with respect to the Committee Nominees additional information is set forth under
the heading "The Election of Directors - The Committee Nominees."
SSP, a Cayman Islands company formed in 1994, invests in publicly
traded securities that SSP believes are substantially undervalued. The principal
business office of SSP is located at 4th Floor, Bank of Nova Scotia Building,
P.O. Box 268, Grand Cayman (Cayman Islands), British West Indies. If you wish to
communicate with SSP concerning ICN and the matters discussed in this Proxy
Statement, Eric Knight, Managing Director of SSP, may be reached at
011-377-93-10-61-40. You may also contact SSP at SSP's website:
http://www.ssp-specialsituationspartners.com.
As of the date of this Proxy Statement, SSP is the record owner of
125,000 shares of Common Stock and, including such shares, is the beneficial
owner of 3,184,300 shares of Common Stock. SSP may also be deemed to
beneficially own all shares of Common Stock owned beneficially by Providence or
the Committee Nominees. SSP intends to vote such shares of Common Stock "FOR"
the Committee Nominees. Providence has the right to acquire 120,000 shares of
Common Stock from SSP pursuant to the agreement described below. See "Certain
Transactions Involving the Participants."
Providence, a Delaware corporation founded in 1991, is engaged in the
investment banking and stock brokerage businesses. The principal business office
of Providence is located at 730 Fifth Avenue, New York, New York, 10019. If you
wish to communicate with Providence concerning ICN and the matters discussed in
this Proxy Statement, Herbert A. Denton, President of Providence, may be reached
at (212) 888-3200.
As of the date of this Proxy Statement, Providence is the beneficial
owner of 79,000 shares of Common Stock. Providence may also be deemed to
beneficially own all shares of Common Stock beneficially owned by SSP or the
Committee Nominees. Providence intends to vote such shares of Common Stock "FOR"
the Committee Nominees. Providence also has the right to acquire (and thus may
be deemed to be the beneficial owner of) 120,000 shares of Common Stock from SSP
pursuant to the agreement described below. See "Certain Transactions Involving
the Participants."
The Committee is an unincorporated association that does not have any
officers or employees and does not beneficially own any securities of the
Company. The business address of the Committee is ICN Committee to Maximize
Shareholder Value, c/o Providence Capital, Inc., 730 Fifth Avenue, New York, New
York, 10019. You may also contact the Committee at its website:
http://www.icnmaxvalue.com.
Dr. Tito Tettamanti is Chairman of SSP. Dr. Tito Tettamanti's business
address is 34-36 Grays Inn Road, London WC1X 8NN, England. As of the date of
this Proxy Statement, Dr. Tettamanti may be deemed to be the beneficial owner of
all securities of the Company which are beneficially owned by SSP.
Eric Knight is Managing Director of SSP. Eric Knight's business
address is La Mamounia, 3963 Crans, Switzerland. As of the date of this Proxy
Statement, Mr. Knight may be deemed to be the beneficial owner of all securities
of the Company which are beneficially owned by SSP.
Herbert A. Denton's principal occupation is President of Providence.
Herbert A. Denton's business address is Providence Capital, Inc., 730 Fifth
Avenue, New York, New York, 10019. As of the date of this Proxy Statement,
Herbert A. Denton may be deemed to be the beneficial owner of all securities of
the Company which are beneficially owned by Providence.
Richard E. Lazarow's principal occupation is Managing Director of
Providence. Richard E. Lazarow's business address is Providence Capital, Inc.
730 Fifth Avenue, New York, New York 10019. As of the date of this Proxy
Statement, Mr. Lazarow may be deemed to be the beneficial owner of all
securities of the Company beneficially owned by Providence.
John J. Hill's principal occupation is financial analyst with
Providence. John J. Hill's business address is Providence Capital, Inc. 730
Fifth Avenue, New York, New York 10019. As of the date of this Proxy Statement,
Mr. Hill is not the beneficial owner of any securities of the Company.
For information relating to transactions by each of the Participants in
securities of the Company over the past two years, see Schedule I hereto.
Each of the Committee Nominees, as well as Eric Knight, Dr. Tito
Tettamanti, Herbert A. Denton, Richard E. Lazarow and John J. Hill may
communicate with stockholders of ICN in the manner contemplated by this Proxy
Statement on behalf of the Committee.
CERTAIN TRANSACTIONS
INVOLVING THE PARTICIPANTS
SSP, Providence and the Committee Nominees are party to an agreement
pursuant to which (i) SSP, Providence and the Committee Nominees have agreed to
cause all shares of Common Stock beneficially owned by them on the Record Date
to be represented in person or by proxy at the 2001 Annual Meeting and to be
voted for the Committee Nominees and for such other actions as may be necessary
or helpful to cause the election of the Committee Nominees to the Board, and
(ii) SSP and Providence have agreed to bear the costs incurred by the Committee
in connection with the solicitation of proxies by the Committee with respect to
the 2001 Annual Meeting on a pro rata basis in proportion to their relative
beneficial ownership of Common Stock as of the date of the 2001 Annual Meeting.
On March 16, 2001, SSP and Providence entered into an agreement
pursuant to which SSP granted to Providence an option to purchase up to 120,000
shares of Common Stock from SSP at $30.68 per share, exercisable during the
period commencing on the conclusion of the 2001 Annual Meeting and ending on
August 30, 2002.
For a description of the SSP Agreement, see "Why Are We Seeking to
Elect the Committee Nominees."
Except as set forth in this Proxy Statement (including the Schedules
hereto), none of the Participants or any of their respective associates: (i)
directly or indirectly beneficially owns any shares of Common Stock or any other
securities of the Company or any of its subsidiaries; (ii) has had any
relationship with the Company in any capacity other than as a stockholder, or is
or has been a party to any transaction, or series of transactions, since the
beginning of the Company's last fiscal year with respect to any securities of
the Company; (iii) knows of any transactions since the beginning of the
Company's last year, currently proposed transactions, or series of similar
transactions, to which the Company or any of its subsidiaries was or is to be a
party, in which the amount involved exceeds $60,000 and in which any of them or
their respective associates had, or will have, a direct or indirect material
interest; (iv) intends to seek to engage in any transaction with the Company or
any of its subsidiaries in the future; or (v) has any interest in the matters to
be voted on at the 2001 Annual Meeting, other than an interest, if any, as a
stockholder of the Company or, with respect to the Committee Nominees, as a
nominee for director.
In addition, other than as set forth in this Proxy Statement (including
the Schedules hereto), there are no contracts, arrangements or understandings
entered into by any of the Participants or any of their respective associates
within the past year with any person with respect to any of the Company's
securities, including, but not limited to, joint ventures, loan or option
arrangements, puts or calls, guarantees against loss or guarantees of profit,
division of losses or profits, or the giving or withholding of proxies.
Except as set forth in this Proxy Statement (including the Schedules
hereto), none of the Participants or any of their respective associates has
entered into any agreement or understanding with any person with respect to (i)
any future employment by the Company or its affiliates or (ii) any future
transactions to which the Company or any of its affiliates will or may be a
party.
Except as set forth in this Proxy Statement (including the Schedules
hereto), none of the Committee Nominees has, since the beginning of the
Company's last fiscal year, been indebted to the Company or any of its
subsidiaries in an amount that exceeds $60,000.
CERTAIN INFORMATION ABOUT ICN
ICN is a Delaware corporation with its principal executive office
located at ICN Plaza, 3300 Hyland Avenue, Costa Mesa, California, 92626. The
telephone number of ICN is (714) 545-0100.
ICN is subject to the informational requirements of the Exchange Act
and in accordance therewith files reports, proxy statements, and other
information with the SEC. Reports, registration statements, proxy statements,
and other information filed by ICN with the SEC can be inspected and copied at
the public reference facilities maintained by the SEC at the Public Reference
Room, 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549. Documents filed
electronically by ICN are also available at the SEC's Web site:
http://www.sec.gov.
Based solely on our review of the ICN 2001 Preliminary Proxy Statement,
and other publicly available information filed with the SEC thereafter, to our
knowledge no person is known, as of the date hereof, to be the beneficial owner
of more than 5% of the outstanding shares of Common Stock.
Schedule II sets forth certain information obtained from the ICN 2001
Preliminary Proxy Statement concerning the beneficial ownership of Common Stock
by the directors and executive officers of the Company.
The ICN 2001 Preliminary Proxy Statement contains, and the Committee
anticipates that ICN's definitive proxy statement for the 2001 Annual Meeting,
when it becomes available, should contain, information concerning, among other
things, (i) the background of ICN's nominees for the Board, (ii) the
compensation paid and payable to the directors and executive officers of ICN,
(iii) information with respect to the beneficial ownership of Common Stock by
the directors and executive officers of the Company, (iv) the committees of
ICN's Board and their members and (v) the meetings of ICN's Board and all
committees thereof. The Committee assumes no responsibility for the accuracy or
completeness of such information.
OTHER MATTERS TO BE CONSIDERED AT
THE 2001 ANNUAL MEETING
Except as set forth in this Proxy Statement, we are not aware of any
proposals to be brought before the 2001 Annual Meeting.
STOCKHOLDER PROPOSALS FOR
THE COMPANY'S 2002 ANNUAL MEETING
According to the ICN 2001 Preliminary Proxy Statement:
o The Company's Restated Certificate of Incorporation provides that
stockholders seeking to bring business before an annual meeting
of stockholders, or to nominate candidates for election as
directors at an annual meeting of stockholders, must provide
timely notice thereof in writing. To be timely, a stockholder's
notice generally must be delivered to or mailed and received at
the Company's principal executive office not less than 60 days or
more than 90 days prior to the scheduled date of the annual
meeting, regardless of any postponement deferral or adjournment
of that meeting. However, if less than 70 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
given not later than the close of business on the 10th day
following the earlier of (i) the day on which the notice of the
date of the meeting was mailed, or (ii) the day on which such
public disclosure was made.
o Any stockholder wishing to submit a proposal to be included in the
proxy materials relating to the 2002 Annual Meeting must submit
such proposal to the Company so that it is received by the Company
at its principal executive offices no later than December 31,
2001.
ADDITIONAL INFORMATION
The information concerning the Company contained in this Proxy
Statement and the Schedules attached hereto has been taken from, or is based
upon publicly available information. Although the Committee does not have any
information that would indicate that any information contained in this Proxy
Statement concerning the Company is inaccurate or incomplete, the Committee does
not take any responsibility for the accuracy or completeness of such
information.
Questions, or requests for additional copies of this Proxy Statement,
should be directed to:
MACKENZIE PARTNERS, INC.
156 Fifth Avenue
New York, NY 10010
email: proxy@mackenziepartners.com
Call Collect: (212) 929-5500
or Toll Free: (800) 322-2885
Facsimile: (212) 929-0308
SCHEDULE I
TRANSACTIONS IN SECURITIES OF THE COMPANY
BY THE PARTICIPANTS
Other than as set forth below, none of the Participants has purchased
or sold securities of the Company in the last two years.
Schedule of Transactions by SSP - Special Situations Partners Inc.
Transactions in Common Stock
Date of Transaction Nature of Transaction Number of Shares of
Common Stock
September 23, 1999 Purchased 25,000
September 24, 1999 Purchased 50,000
September 27, 1999 Purchased 20,000
September 28, 1999 Purchased 18,000
September 29, 1999 Purchased 20,000
October 1, 1999 Purchased 19,900
October 4, 1999 Purchased 30,000
October 5, 1999 Purchased 5,000
October 8, 1999 Purchased 17,500
October 13, 1999 Purchased 25,000
October 15, 1999 Purchased 25,000
October 18, 1999 Purchased 10,000
October 20, 1999 Purchased 14,600
October 22, 1999 Purchased 90,000
October 26, 1999 Purchased 208,100
October 27, 1999 Purchased 123,300
October 28, 1999 Purchased 106,700
October 29, 1999 Purchased 68,000
November 1, 1999 Purchased 102,200
November 2, 1999 Purchased 67,300
November 3, 1999 Purchased 100,000
November 5, 1999 Purchased 125,000
November 8, 1999 Purchased 49,400
November 9, 1999 Purchased 33,500
November 10, 1999 Purchased 33,100
November 19, 1999 Purchased 30,000
November 22, 1999 Purchased 29,200
November 23, 1999 Purchased 120,000
November 24, 1999 Purchased 127,700
November 29, 1999 Purchased 32,800
November 30, 1999 Purchased 50,000
December 1, 1999 Purchased 54,300
December 2, 1999 Purchased 22,500
December 3, 1999 Purchased 55,000
December 6, 1999 Purchased (1) 5,200
December 10, 1999 Purchased (1) 4,100
December 27, 1999 Purchased 30,000
December 28, 1999 Purchased 25,000
December 30, 1999 Purchased 15,000
January 28, 2000 Purchased 8,000
February 22, 2000 Purchased (1) 400
February 24, 2000 Purchased (1) 5,000
March 20, 2000 Purchased (1) 50,000
March 30, 2000 Purchased 20,000
April 4, 2000 Purchased 100,000
April 5, 2000 Purchased 18,800
April 6, 2000 Purchased 41,500
April 7, 2000 Purchased 90,000
April 10, 2000 Purchased 50,000
April 11, 2000 Purchased 60,000
April 12, 2000 Purchased 7,300
June 19, 2000 Purchased 125,000
June 23, 2000 Purchased 30,000
June 26, 2000 Purchased 30,000
July 10, 2000 Purchased 125,000
July 13, 2000 Purchased 40,000
July 21, 2000 Purchased 63,400
July 24, 2000 Purchased 137,500
July 25, 2000 Purchased 100,000
July 26, 2000 Purchased 100,000
November 15, 2000 Sold (2) (5,000)
--------------------------------------------------------------------------------
Total: 3,184,300
(1) Purchase made pursuant to a previously outstanding put option.
(2) On November 15, 2000, SSP transferred 1,000 shares of Common Stock
to each of five individuals in connection with each such individual's
agreement to be nominated by SSP as a director at the 2000 annual
meeting of the Company.
Transactions in Call and Put Options for Common Stock
Date of Transaction Nature of Transaction Number of Underlying
Shares of Common Stock
October 21, 1999 Purchased Call 2,500
October 21, 1999 Purchased Call 2,500
October 21, 1999 Purchased Call 5,000
October 22, 1999 Purchased Call 7,000
October 25, 1999 Purchased Call 1,000
October 26, 1999 Purchased Call 5,000
October 29, 1999 Purchased Call 5,000
October 29, 1999 Purchased Call 5,000
October 29, 1999 Purchased Call 25,000
October 29, 1999 Purchased Call 25,000
October 29, 1999 Sold Put 7,500
October 29, 1999 Sold Put 2,500
October 29, 1999 Sold Put 25,000
October 29, 1999 Sold Put 25,000
November 2, 1999 Purchased Call 25,000
November 2, 1999 Purchased Call 15,000
November 2, 1999 Purchased Call 10,000
November 2, 1999 Purchased Call 2,500,000
November 2, 1999 Sold Put 25,000
November 2, 1999 Sold Put 15,000
November 2, 1999 Sold Put 10,000
November 3, 1999 Purchased Call 25,000
November 3, 1999 Purchased Call 10,000
November 3, 1999 Purchased Call 1,000,000
November 3, 1999 Sold Put 25,000
November 3, 1999 Sold Put 10,000
November 3, 1999 Sold Put 5,000
November 3, 1999 Sold Put 5,000
November 4, 1999 Purchased Call 10,000
December 9, 1999 Sold Call 2,000
December 9, 1999 Purchased Put 10,000
December 9, 1999 Purchased Put 10,000
December 10, 1999 Sold Call 12,500
December 10, 1999 Sold Call 5,000
December 10, 1999 Sold Call 10,000
December 10, 1999 Sold Call 2,500
December 10, 1999 Purchased Put 10,000
December 10, 1999 Purchased Put 10,000
December 10, 1999 Purchased Put 2,500
December 10, 1999 Purchased Put 27,500
December 10, 1999 Purchased Put 10,000
December 10, 1999 Purchased Put 700
December 10, 1999 Purchased Put 5,000
December 13, 1999 Sold Call 30,000
December 14, 1999 Sold Call 5,000
December 15, 1999 Sold Call 5,000
December 15, 1999 Sold Call 10,000
December 16, 1999 Sold Call 2,500
December 16, 1999 Sold Call 7,400
December 16, 1999 Sold Call 1,600
December 17, 1999 Sold Call 2,500
December 17, 1999 Sold Call 4,500
December 17, 1999 Sold Call 4,500
March 16, 2000 Sold Call 25,000
March 16, 2000 Sold Call 27,500
March 16, 2000 Sold Call 2,500
March 17, 2000 Purchased Put 4,600
May 17, 2000 Purchased Call 2,500,000
May 17, 2000 Sold Call 2,500,000
May 22, 2000 Purchased Call 1,000,000
May 22, 2000 Sold Call 1,000,000
June 9, 2000 Purchased Call 10,000
June 9, 2000 Purchased Call 15,000
June 9, 2000 Purchased Call 10,000
June 9, 2000 Purchased Call 20,000
September 8, 2000 Sold Call 5,000
September 11, 2000 Sold Call 5,000
September 11, 2000 Sold Call 5,000
December 1, 2000 Sold Call 20,000
March 16, 2001 Sold Call 120,000
Other than the option granted to Providence by SSP on March 16, 2001 in
respect of 120,000 shares of Common Stock, SSP has no put or call options with
respect to Common Stock outstanding as of the date of this Proxy Statement.
Schedule of Transactions by Providence Capital, Inc. / Herbert A. Denton
Transactions in Common Stock
Date of Transaction Nature of Transaction Number of Shares of
Common Stock
January 30, 2001 Purchased (1) 15,000
January 30, 2001 Purchased (3) 5,000
February 1, 2001 Purchased (1) 32,000
February 1, 2001 Purchased (3) 20,000
February 5, 2001 Sold (1) (5,000)
February 5, 2001 Sold (3) (5,000)
February 12, 2001 Purchased (1) 8,000
February 12, 2001 Purchased (3) 5,000
February 15, 2001 Purchased (1) 500
February 16, 2001 Purchased (1) 5,000
February 21, 2001 Sold (1) (5,000)
February 27, 2001 Sold (1) (5,000)
March 1, 2001 Purchased (1) 5,000
March 8, 2001 Purchased (3) 2,500
March 12, 2001 Purchased (2) 5,000
March 21, 2001 Purchased (1) 4,500
March 22, 2001 Purchased (3) 2,500
March 30, 2001 Sold (1) (7,000)
April 23, 2001 Sold (4) (9,000)
--------------------------------------------------------------------------------
Total: 74,000
(1) Transaction effected by US Value Investment Company PLC of which Providence
Advisors, LLC is the investment advisor. Mr. Denton is the sole managing
member of Providence Advisors, LLC.
(2) Transaction effected by Providence Capital, Inc. Mr. Denton is the record
owner of 90% of the outstanding equity securities of Providence Capital,
Inc.
(3) Transaction effected by Providence Investors, LLC of which Mr. Denton is
one of two managing members.
(4) These shares were transferred by Providence Investors, LLC to three of its
members as part of a liquidating distribution to such members of their
pro-rata interest in Providence Investors, LLC.
Transactions in Call and Put Options for Common Stock
Date of Transaction Nature of Transaction Number of Underlying
Shares of Common Stock
March 16, 2001 Call option from SSP (1) 120,000
March 22, 2001 Purchased Call (1) 5,000
(1) Transaction effected by Providence Capital, Inc.
Schedule of Transactions by Edward A. Burkhardt
Date of Transaction Nature of Transaction Number of Shares of
Common Stock
February 12, 2001 Purchased 100,000
February 22, 2001 Purchased 40,000
February 23, 2001 Purchased 10,000
March 21, 2001 Purchased 100,000
--------------------------------------------------------------------------------
Total: 250,000
Schedule of Transactions by Ronald R. Fogleman
The following transaction was effected by B Bar J Cattle Co. Pension
Plan Defined Benefit Plan and Trust of which Ronald R. Fogleman is a Trustee.
Date of Transaction Nature of Transaction Number of Shares of
Common Stock
March 28, 2001 Purchased 1,000
Schedule of Transactions by Steven J. Lee
Date of Transaction Nature of Transaction Number of Shares of
Common Stock
March 13, 2001 Purchased 15,000
March 14, 2001 Purchased 10,000
--------------------------------------------------------------------------------
Total: 25,000
SCHEDULE II
BENEFICIAL OWNERSHIP OF SHARES OF COMMON STOCK
The following information is excerpted from and is based solely upon
the ICN 2001 Preliminary Proxy Statement, and sets forth, as of April 23, 2001,
information regarding the beneficial ownership of the Common Stock and the
percent of shares owned beneficially by the directors and each of the Chief
Executive Officer of the Company and certain executive officers of the Company,
including the four most highly paid executive officers of the Company, and all
directors and executive officers of the Company as a group:
Name of Beneficial Owner Number of Shares of Common Stock Percent of Class
Beneficially Owned (1)
-----------------------------------------------------------------------------------------------------------------
Norman Barker, Jr....................................... 146,819 (3) (2)
Birch E. Bayh, Jr....................................... 97,266 (4) (2)
Kim Campbell............................................ -- (2)
Alan F. Charles......................................... 100,547 (5) (2)
Roger Guillemin......................................... 160,509 (6) (2)
Ray Irani............................................... -- (2)
Adam Jerney............................................. 1,169,605 (7) 1.5%
Andrei Kozyrev.......................................... 40,625 (8) (2)
Jean-Francois Kurz...................................... 127,716 (9) (2)
Thomas H. Lenagh........................................ 136,117 (10) (2)
Charles T. Manatt....................................... 36,787 (11) (2)
Stephen D. Moses........................................ 84,808 (12) (2)
Milan Panic............................................. 2,690,180 (13) 3.3%
Roberts A. Smith........................................ 215,733 (14) (2)
Rosemary Tomich......................................... -- (2)
Richard A. Meier........................................ 80,250 (15) (2)
John E. Giordani........................................ 80,218 (16) (2)
Bill A. MacDonald....................................... 50,044 (17) (2)
James G. McCoy.......................................... -- (2)
Johnson Y.N. Lau........................................ 18,750 (18) (2)
Jack Sholl.............................................. 152,250 (19) (2)
David Watt.............................................. 193,140 (20) (2)
Directors and executive officers of the
Company as a group (22 persons)......................... 5,581,364 (21) 7%
(1) Except as indicated otherwise in the following notes, shares shown as
beneficially owned are those as to which the named persons possess sole
voting and investment power. However, under the laws of California and
certain other states, personal property owned by a married person may be
community property which either spouse may manage and control, and the
Company has no information as to whether any shares shown in this table are
subject to community property laws.
(2) Less than 1%.
(3) Includes 141,690 shares of Common Stock which Mr. Barker has the right to
acquire within 60 days upon the exercise of stock options.
(4) Includes 97,266 shares of Common Stock which Sen. Bayh has the right to
acquire within 60 days upon the exercise of stock options.
(5) Includes 100,478 shares of Common Stock which Mr. Charles has the right to
acquire within 60 days upon the exercise of stock options.
(6) Includes 159,681 shares of Common Stock which Dr. Guillemin has the right
to acquire within 60 days upon the exercise of stock options.
(7) Includes 735,498 shares of Common Stock which Mr. Jerney has the right to
acquire within 60 days upon the exercise of stock options.
(8) Includes 40,625 shares of Common Stock which Mr. Kozyrev has the right to
acquire within 60 days upon the exercise of stock options.
(9) Includes 127,716 shares of Common Stock which Mr. Kurz has the right to
acquire within 60 days upon the exercise of stock options.
(10) Includes 124,528 shares of Common Stock which Mr. Lenagh has the right to
acquire within 60 days upon the exercise of stock options.
(11) Includes 33,750 shares of Common Stock which Mr. Manatt has the right to
acquire within 60 days upon the exercise of stock options.
(12) Includes 84,505 shares of Common Stock which Mr. Moses has the right to
acquire within 60 days upon the exercise of stock options.
(13) Includes 2,034,946 shares of Common Stock which Mr. Panic has the right to
acquire within 60 days upon the exercise of stock options.
(14) Includes 192,162 shares of Common Stock which Dr. Smith has the right to
acquire within 60 days upon the exercise of stock options.
(15) Includes 76,750 shares of Common Stock which Mr. Meier has the right to
acquire within 60 days upon the exercise of stock options.
(16) Includes 77,356 shares of Common Stock which Mr. Giordani has the right to
acquire within 60 days upon the exercise of stock options.
(17) Includes 44,250 shares of Common Stock which Mr. MacDonald has the right to
acquire within 60 days upon the exercise of stock options.
(18) Includes 18,750 shares of Common Stock which Dr. Lau has the right to
acquire within 60 days upon the exercise of stock options.
(19) Includes 138,682 shares of Common Stock which Mr. Sholl has the right to
acquire within 60 days upon the exercise of stock options.
(20) Includes 188,204 shares of Common Stock which Mr. Watt has the right to
acquire within 60 days upon the exercise of stock options.
(21) Includes 4,416,837 shares of Common Stock which directors and executive
officers have the right to acquire within 60 days upon the exercise of
stock options.
* * *
Although the Committee does not have any information that would
indicate that any information contained in this Schedule II, which has been
excerpted from the ICN 2001 Preliminary Proxy Statement, is inaccurate or
incomplete, the Committee assumes no responsibility for the accuracy or
completeness of such information.
If you have any questions concerning this Proxy Statement or need help
voting your shares, please call:
[Mackenzie Partners, Inc. logo]
MACKENZIE PARTNERS, INC.
156 Fifth Avenue
New York, NY 10010
email: proxy@mackenziepartners.com
Call Collect: (212) 929-5500
or Toll Free: (800) 322-2885
Facsimile: (212) 929-0308
REVOCABLE REVOCABLE
PROXY PROXY
ICN PHARMACEUTICALS, INC.
2001 ANNUAL MEETING OF STOCKHOLDERS
MAY 30, 2001
THIS PROXY IS SOLICITED IN OPPOSITION TO THE BOARD OF DIRECTORS
OF ICN PHARMACEUTICALS, INC. ON BEHALF OF
THE ICN COMMITTEE TO MAXIMIZE SHAREHOLDER VALUE (THE "COMMITTEE")
The undersigned stockholder of ICN Pharmaceuticals, Inc. (the
"Company") hereby appoints Eric Knight, Herbert A. Denton and John K. Kelly, or
any one of them, each with full power of substitution, to act as proxies for the
undersigned, and to vote all shares of common stock, par value $0.01 per share,
of the Company ("Common Stock"), which the undersigned would be entitled to vote
if personally present at the 2001 annual meeting of stockholders of the Company
to be held at 10:00 a.m. P.D.T. on May 30, 2001, and at any and all
postponements and adjournments thereof (the "2001 Annual Meeting"), as indicated
on this proxy.
THIS PROXY IS REVOCABLE AND WILL BE VOTED AS DIRECTED, BUT IF NO
INSTRUCTIONS ARE SPECIFIED, THIS PROXY WILL BE VOTED FOR THE ELECTION OF EACH OF
THE NOMINEES IDENTIFIED ON THIS CARD OR, IN THE EVENT THAT ANY SUCH NOMINEE IS
NOT AVAILABLE FOR ELECTION OR UNABLE TO SERVE, SUCH OTHER PERSON AS THE
COMMITTEE SHALL PROPOSE. IF ANY OTHER BUSINESS IS PRESENTED AT THE 2001 ANNUAL
MEETING, THIS PROXY WILL BE VOTED BY THOSE NAMED IN THIS PROXY IN THEIR BEST
JUDGMENT. AT THE PRESENT TIME, THE COMMITTEE KNOWS OF NO OTHER BUSINESS TO BE
PRESENTED AT THE 2001 ANNUAL MEETING. THIS PROXY REVOKES ALL PRIOR PROXIES GIVEN
BY THE UNDERSIGNED WITH RESPECT TO MATTERS COVERED BY THIS PROXY AND THE VOTING
OF SHARES OF COMMON STOCK AT THE 2001 ANNUAL MEETING.
PLEASE SIGN AND DATE ON THE REVERSE AND MAIL THE PROXY
CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
For All Nominees of the
1. ELECTION OF DIRECTORS-NOMINEES OF THE COMMITTEE: Committee Withhold Authority
To elect to the Board of Directors of the Company: [ ] [ ]
Edward A. Burkhardt, Ronald R. Fogleman and Steven
J. Lee.
Instruction: If you have checked the above "FOR"
box, to withhold authority to vote for the election
of any individual nominee(s), write the name(s) of
such nominee(s) in the following space:
__________________________________________________
2. In the discretion of the Proxies appointed
hereunder, on such other business as may properly
come before the meeting.
The undersigned acknowledges receipt of the
Committee's Proxy Statement.
Dated: _____________________________________, 2001 IMPORTANT: PLEASE SIGN EXACTLY AS YOUR NAME OR
NAMES APPEAR HEREON. IF SIGNING AS AN ATTORNEY,
EXECUTOR, ADMINISTRATOR, TRUSTEE, GUARDIAN, OR IN
Signature(s) _____________________________________ SOME OTHER REPRESENTATIVE CAPACITY, OR AS AN
OFFICER OF A CORPORATION, PLEASE INDICATE YOUR
CAPACITY OR FULL TITLE. IF STOCK IS HELD JOINTLY,
_____________________________________ EACH JOINT OWNER SHOULD SIGN.
YOUR VOTE IS IMPORTANT! PLEASE SIGN, DATE, AND PROMPTLY MAIL YOUR PROXY.