1. What motivated Circon’s Chairman and CEO Richard Auhl? Were his financial incentives strongly aligned with those of the shareholders?
2. What mechanisms did Auhl put in place in response to the telephone call from US Surgical’s Leon Hirsch?
3. Did Circon’s poison pill represent a strong or weak barrier to a hostile takeover? If a hostile bidder had triggered the poison pill, what precisely would have happened to Circon’s price and the hostile bidder’s stake in the company (need to calculate the price and the stake)?
4. Evaluate the options that are available to the board at the end of the case? Which option appears to be the most attractive? Explain.
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