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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported):August 30,1996 (August 22,1996)
MYLAN LABORATORIES INC.
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(Exact Name of Registrant as Specified in its Charter)
Pennsylvania
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(State or Other Jurisdiction of Incorporation)
001-09114 251211621
(Commission File Number) (I.R.S. Employer Identification No.)
130 Seventh Street, 1030 Century Bldg., Pittsburgh, PA 15222
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(Address of Principal Executive Offices) (Zip Code)
(412) 232-0100
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(Registrant's Telephone Number, Including Area Code)
Item 5. Other Events
Adoption of Rights Plan
On August 22, 1996 (the "Rights Dividend Declaration Date"), the Board of
Directors of Mylan Laboratories Inc. (the "Corporation") adopted a Shareholder
Rights Plan and declared that a dividend of one share purchase right ("Right")
be distributed on each outstanding share of Common Stock, par value $0.50 per
share ("Common Stock"), to shareholders of record as of the close of business on
September 5, 1996 (the "Record Date"). Each Right entitles the registered holder
to purchase from the Corporation one one-thousandth of a share of Series A
Junior Participating Preferred Stock, par value $0.50 per share ("Preferred
Stock"), or, in certain circumstances, shares of Common Stock, other securities,
and/or cash or other property, at a Purchase Price of $90 per share of Preferred
Stock (or, when applicable, Common Stock, securities, cash, and/or other
property), subject to adjustment. The complete terms and conditions of the
Rights are set forth in a Rights Agreement dated as of August 22, 1996 (the
"Rights Agreement") between the Corporation and American Stock Transfer & Trust
Company, as Rights Agent.
All shares of Common Stock outstanding on the Record Date will receive
Rights. In addition, all shares of Common Stock issued prior to the Distribution
Date will be issued with Rights. All certificates for Common Stock issued after
the Record Date and prior to the Distribution Date will contain a legend
incorporating the Rights Agreement by reference.
Initially, the Rights will attach to the outstanding shares of Common
Stock, and no separate Right Certificates will be distributed. The Rights will
detach from the outstanding shares
2.
of Common Stock and separate Right Certificates will be issued when there is a
Distribution Date. Until a Distribution Date occurs, the Rights will be
evidenced by the certificate for the shares of Common Stock with a copy of this
Summary of Rights attached thereto, the Rights will transfer with (and only
with) the shares of Common Stock to which such Rights are attached, and the
transfer of any certificate for Common Stock (with or without this Summary of
Rights attached thereto) will also constitute the transfer of the Rights
attached to the shares of Common Stock represented by such certificate.
A "Distribution Date" will occur on (i) the tenth day following a public
announcement that a person has become an Acquiring Person (the date of such
public announcement being the "Shares Acquisition Date"), or (ii) if earlier,
the tenth business day (or such later date as may be determined by the Board of
Directors prior to such time as any person becomes an Acquiring Person)
following the commencement or announcement of a tender or exchange offer that
would result in a person or group of affiliated or associated persons becoming
the Beneficial Owner of 15% or more of the outstanding shares of Common Stock.
An "Acquiring Person" is a person or group of affiliated or associated
persons that Beneficially Owns 15% or more of the outstanding shares of Common
Stock but does not include (1) the Corporation, its subsidiaries, any employee
benefit plan of the Corporation or any of its Subsidiaries, or any entity
holding shares of Common Stock pursuant to the terms of any such plan; (2) any
person or group that becomes the Beneficial Owner of 15% or more of the
outstanding shares of Common Stock solely as a result of the acquisition of
Common Stock by the Corporation, unless such person or group thereafter acquires
additional shares of Common Stock; or (3) subject to certain conditions set
forth in the Rights Agreement, a person that otherwise
3.
would have become an Acquiring Person as a result of an inadvertent acquisition
of 15% or more of the outstanding shares of Common Stock.
The Rights are not exercisable until the Distribution Date and will expire
at the close of business on September 5, 2006 (the "Final Expiration Date"),
unless the Final Expiration Date is extended or unless the Rights are earlier
redeemed or exchanged by the Corporation, in each case, as described below.
As soon as practicable after the Distribution Date, separate Right
Certificates will be mailed to the holders of record of Common Stock as of the
Distribution Date, and, thereafter, the Right Certificates alone will represent
the Rights.
The Purchase Price payable upon exercise of the Rights and the number of
shares of Preferred Stock (and the amount of other securities and/or property,
if any) issuable upon exercise of the Rights are subject to adjustment from time
to time to prevent dilution in the event that (i) there is a stock dividend on,
or a subdivision, combination, or reclassification of the Preferred Stock, or
(ii) the holders of Preferred Stock are granted certain options, warrants, or
rights to subscribe for or purchase shares of Preferred Stock (or equivalent
Preferred Stock) or securities convertible into Preferred Stock (or securities
convertible into equivalent Preferred Stock) at a price less than the current
market price of Preferred Stock, or (iii) any evidences of indebtedness or
assets (other than regular quarterly cash dividends or dividends payable in
shares of Preferred Stock) or any subscription rights or warrants (other than
rights, options, or warrants of the type referred to in clause (ii) of this
paragraph) are distributed to the holders of Preferred Stock.
4.
Subject to certain exceptions as set forth in the Rights Agreement, no
adjustment in the Purchase Price will be required until the cumulative
adjustments amount to 1% of the Purchase Price.
The number of outstanding Rights and the number of one one-thousandths of a
share of Preferred Stock issuable upon exercise of each Right are also subject
to adjustment in the event of a stock split of the Common Stock or a stock
dividend on the shares of Common Stock payable in shares of Common Stock or
subdivisions, consolidations, or combinations of the shares of Common Stock
occurring, in any such case, prior to the Distribution Date.
No fractional shares of Preferred Stock (other than fractions that are
integral multiples of one one-thousandths of a share of Preferred Stock, which,
at the election of the Corporation, may be evidenced by depository receipts)
will be issued upon exercise of the Rights, but, in lieu thereof, a cash
adjustment will be paid to the holder of the exercised Rights based on the
market price of the Preferred Stock on the last trading date prior to the date
of exercise.
Shares of Preferred Stock purchasable upon exercise of the Rights will not
be redeemable. The dividend, liquidation, and voting rights, and non-redemption
features of the Preferred Stock are designed so that the value of a one
one-thousandth interest in a share of Preferred Stock purchasable upon exercise
of each Right should approximate the value of one share of Common Stock. Each
whole share of Preferred Stock will be entitled to receive a quarterly
preferential dividend equal to the greater of (a) $1.00 or (b) 1000 times the
dividend declared with respect to each share of Common Stock. In the event of
liquidation, the holders of each whole share of Preferred Stock will be entitled
to receive a preferential liquidation payment equal to the greater of (a)
$1000.00 or (b) 1000 times the payment made per share of Common
5.
Stock. Each share of Preferred Stock will have 1000 votes, voting together with
the shares of Common Stock. Finally, in the event of any merger, consolidation,
or other transaction in which shares of Common Stock are exchanged for or
changed into other stock or securities, cash, and/or other property, each share
of Preferred Stock will be entitled to receive 1000 times the amount received
per share of Common Stock. These rights and preferences are protected by
customary anti-dilution provisions.
Once a person has become an Acquiring Person, all Rights that are, or
(under certain circumstances specified in the Rights Agreement) were,
Beneficially Owned by an Acquiring Person will be null and void.
In the event that any person becomes an Acquiring Person, proper provision
shall be made so that each holder of a Right (other than a Right that is or was
Beneficially Owned by an Acquiring Person that has become null and void pursuant
to the terms of the Rights Agreement), shall thereafter have the right to
receive upon exercise of such Right that number of shares of Common Stock (or,
in certain circumstances, Preferred Stock, or other securities, property and/or
cash) having a value equal to two times the then-current Purchase Price.
In the event that, at any time after a person becomes an Acquiring Person,
(i) the Corporation is acquired in a merger or other business combination, or
(ii) 50% or more of the assets or earning power of the Corporation and its
Subsidiaries (taken as a whole) is sold or otherwise transferred, proper
provision will be made so that each holder of a Right (other than a Right that
is or was Beneficially Owned by an Acquiring Person that has become null and
void pursuant to the terms of the Rights Agreement) shall thereafter have the
right to receive upon exercise of such Right, in lieu of shares of Preferred
Stock, shares of common stock of the
6.
acquiror then having a current market value equal to two times the
then-current Purchase Price. The events referred to in the preceding paragraph
and in clauses (i) and (ii) of this paragraph are hereinafter referred to as
"Triggering Events."
At any time prior to the Close of Business on the tenth calendar day
following the Shares Acquisition Date (or, if the Shares Acquisition Date
occurred prior to the Record Date, the Close of Business on the tenth calendar
day following such Record Date), the Board of Directors of the Corporation may
redeem the Rights in whole, but not in part, at a price of $0.001 per Right,
subject to adjustment (the "Redemption Price") provided, however, that if such
authorization occurs on or after the date of a change (resulting from a proxy
solicitation) in a majority of the directors in office at the commencement of
such solicitation, and any Person who is or was a participant in such
solicitation has stated (or if upon the commencement of such solicitation, a
majority of the Board of Directors of the Corporation has determined in good
faith) that such Person (or any of its Affiliates or Associates) has taken or
intends to take, or may consider taking, any action that would result in such
Person becoming an Acquiring Person or that would cause the occurrence of a
Triggering Event (the existence of the circumstances described in this provision
being referred to herein as an "Adverse Change of Control"), then the Rights may
be so redeemed only if there are Continuing Directors in office and such
redemption is authorized by a majority of such Continuing Directors. The
redemption of the Rights may be made effective at such time, on such basis, and
with such conditions as the Board of Directors in its sole discretion may
establish. Immediately upon any redemption of the Rights, the right to exercise
the Rights will terminate and the only right of the holders of Rights will be to
receive the Redemption Price.
7.
At any time after any person becomes an Acquiring Person, and prior to the
time any person (other than the Corporation, any of its Subsidiaries, any
employee benefit plan of the Corporation or any of its Subsidiaries, and any
entity holding shares of Common Stock pursuant to the terms of any such plan)
becomes the Beneficial Owner of 50% or more of the outstanding shares of Common
Stock, the Corporation may, at the option and election of the Board of
Directors, exchange shares of Common Stock (or in certain circumstances, shares
of Preferred Stock) for all or any part of the then-outstanding and unexercised
Rights (other than Rights that are or were Beneficially Owned by an Acquiring
Person that have become null and void pursuant to the terms of the Rights
Agreement) at an exchange rate of one share of Common Stock (or in certain
circumstances, one one-thousandth of a share of Preferred Stock) per Right,
appropriately adjusted to reflect any stock dividend, stock split, reverse stock
split, or other similar transaction occurring after the Rights Dividend
Declaration Date.
The terms of the Rights may be amended by the Board of Directors of the
Corporation without the consent of the holders of the Rights, except that from
and after the Close of Business on the tenth calendar day following the Shares
Acquisition Date (or, if the Shares Acquisition Date occurred prior to the
Record Date, the Close of Business on the tenth calendar day following such
Record Date) no such amendment may adversely affect the interests of the holders
of the Rights (other than Rights that are or were Beneficially Owned by an
Acquiring Person that have become null and void pursuant to the terms of the
Rights Agreement) and provided, however, that if such amendment occurs on or
after an Adverse Change of Control, then the Rights Plan may be amended only if
there are Continuing Directors in office and such amendment is authorized by a
majority of such Continuing Directors.
8.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a shareholder of the Corporation, including, without limitation, the
right to vote or to receive dividends.
Item 7. Financial Statements and Exhibits
(c) Exhibits
Description
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3.1 Resolution of Board of Directors to Amend Articles of
Incorporation to Establish Series A Junior Participating
Preferred Stock.
4.1 Rights Agreement, dated as of August 22, 1996,
between Mylan Laboratories Inc. and American Stock
Transfer & Trust Company
4.2 Form of Right Certificate.
9.
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
MYLAN LABORATORIES INC.
(Registrant)
August 28, 1996 By: /s/ Milan Puskar
Name: Milan Puskar
Title: Chairman, CEO and President
10.
Exhibit 3.1
11.
RESOLUTION OF BOARD OF DIRECTORS
TO AMEND ARTICLES OF INCORPORATION
TO ESTABLISH A SERIES OF PREFERRED SHARES*
RESOLVED, that pursuant to the authority granted to and vested in the Board
of Directors of the Company in accordance with the provisions of the Amended and
Restated Articles of Incorporation of the Company and Section 1522 of the
Pennsylvania Business Corporation Law, as amended, the Board of Directors hereby
adopts and approves an amendment to the Amended and Restated Articles of
Incorporation of the Company, as amended, which creates out of the authorized
but unissued shares of Preferred Stock, par value $0.50 per share, of the
Company a series of Preferred Stock, the designation and authorized number of
shares of which, and the terms and relative rights, preferences and limitations
of which, are as follows:
Section 1. Designation and Amount. The shares of such series
shall be designated as "Series A Junior Participating
Preferred Stock" (the "Series A Preferred Stock") and the
number of shares constituting the Series A Preferred Stock
shall be 300,000. Such number of shares may be increased or
decreased by resolution of the Board of Directors; provided,
(a) that no decrease shall reduce the number of shares of
Series A Preferred Stock to a number less than the number of
shares then outstanding plus the number of shares reserved for
issuance upon the exercise of outstanding options, rights, or
warrants or upon the conversion of any outstanding securities
issued by the corporation convertible into Series A Preferred
Stock; and (b) no increase shall cause the aggregate number of
all shares of Preferred Stock that the corporation is
authorized to issue to be greater than is authorized by these
Amended and Restated Articles of Incorporation.
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any
shares of any other series of Preferred Stock of the
corporation (or any similar stock) ranking prior and superior
to the Series A Preferred Stock with respect to dividends, the
holders of shares of Series A Preferred Stock, in preference
to the holders of Common Stock, par value $0.50 per share (the
"Common Stock"), of the corporation, and of any other junior
stock, shall be
12.
entitled to receive, when, as and if declared by the Board of
Directors out of funds legally available for the purpose,
quarterly dividends payable in cash on the first day of March,
June, September, and December in each year (each such date
being referred to herein as a "Quarterly Dividend Payment
Date"), commencing on the first Quarterly Dividend Payment
Date after the first issuance of a share or fraction of a
share of Series A Preferred Stock, in an amount per share
(rounded to the nearest cent) equal to the greater of (a) $1
or (b) subject to the provision for adjustment hereinafter set
forth, 1000 times the aggregate per share amount of all cash
dividends, and 1000 times the aggregate per share amount
(payable in kind) of all non-cash dividends or other
distributions, other than a dividend payable in shares of
Common Stock or a subdivision of the outstanding shares of
Common Stock (by reclassification or otherwise), declared on
the Common Stock since the immediately preceding Quarterly
Dividend Payment Date or, with respect to the first Quarterly
Dividend Payment Date, since the first issuance of any share
or fraction of a share of Series A Preferred Stock. In the
event the corporation shall at any time declare or pay any
dividend on the Common Stock payable in shares of Common
Stock, or effect a subdivision or combination or consolidation
of the outstanding shares of Common Stock (by reclassification
or otherwise than by payment of a dividend in shares of Common
Stock) into a greater or lesser number of shares of Common
Stock, then in each such case the amount to which holders of
shares of Series A Preferred Stock were entitled immediately
prior to such event under clause (b) of the preceding sentence
shall be adjusted by multiplying such amount by a frac tion,
the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator
of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(B) The corporation shall declare a dividend or
distribution on the Series A Preferred Stock as provided in
paragraph (A) of this Section immediately after it declares a
dividend or distribution on the Common Stock (other than a
dividend payable in shares of Common Stock); provided that, in
the event no
13.
dividend or distribution shall have been declared on the
Common Stock during the period between any Quarterly Dividend
Payment Date and the next subsequent Quarterly Dividend
Payment Date, a dividend of $1 per share on the Series A
Preferred Stock shall nevertheless be payable on such
subsequent Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative
on outstanding shares of Series A Preferred Stock from the
Quarterly Dividend Payment Date next preceding the date of
issue of such shares, unless the date of issue of such shares
is prior to the record date for the first Quarterly Dividend
Payment Date, in which case dividends on such shares shall
begin to accrue from the date of issue of such shares, or
unless the date of is sue is a Quarterly Dividend Payment Date
or is a date after the record date for the determination of
holders of shares of Series A Preferred Stock entitled to
receive a quarterly dividend and before such Quarterly
Dividend Payment Date, in either of which events such
dividends shall begin to accrue and be cumulative from such
Quarterly Dividend Payment Date. Accrued but unpaid dividends
shall not bear interest. Dividends paid on the shares of
Series A Preferred Stock in an amount less than the total
amount of such dividends at the time accrued and payable on
such shares shall be allocated pro rata on a share-by-share
basis among all such shares at the time outstanding. The Board
of Directors may fix a record date for the determination of
holders of shares of Series A Preferred Stock entitled to
receive payment of a dividend or distribution declared
thereon, which record date shall be not more than 60 days
prior to the date fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of
Series A Preferred Stock shall have the following voting
rights:
(A) Subject to the provision for adjustment
hereinafter set forth, each share of Series A Preferred Stock
shall entitle the holder thereof to 1000 votes on all matters
submitted to a vote of the shareholders of the corporation. In
the event the corporation shall at any time declare or pay any
dividend on the Common Stock
14.
payable in shares of Common Stock, or effect a subdivi sion or
combination or consolidation of the outstanding shares of
Common Stock (by reclassification or otherwise than by payment
of a dividend in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in each such
case the number of votes per share to which holders of shares
of Series A Preferred Stock were entitled immediately prior to
such event shall be adjusted by multiplying such number by a
fraction, the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock
that were outstanding immediately prior to such event.
(B) Except as otherwise provided herein or in any
other Statement with Respect to Shares or other amendment of
the Articles of Incorporation creating a series of Preferred
Stock or any similar stock, or by law, the holders of shares
of Series A Preferred Stock and the holders of shares of
Common Stock and any other capital stock of the corporation
having general voting rights shall vote together as one class
on all matters submitted to a vote of shareholders of the
corporation.
(C) Except as set forth herein, or as otherwise
provided by law, holders of Series A Preferred Stock shall
have no special voting rights and their consent shall not be
required (except to the extent they are entitled to vote with
holders of Common Stock as set forth herein) for taking any
corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends
or distributions payable on the Series A Preferred Stock as
provided in Section 2 are in arrears, thereafter and until all
accrued and unpaid dividends and distributions, whether or not
declared, on shares of Series A Preferred Stock outstanding
shall have been paid in full, the corporation shall not:
(i) declare or pay dividends, or make
any other distributions, on any shares of stock ranking
junior (either as to dividends or upon liquidation,
15.
dissolution, or winding up) to the Series A Preferred
Stock;
(ii) declare or pay dividends, or make any
other distributions, on any shares of stock ranking on a
parity (either as to dividends or upon liquidation,
dissolution, or winding up) with the Series A Preferred Stock,
except dividends paid ratably on the Series A Preferred Stock
and all such parity stock on which dividends are payable or in
arrears in proportion to the total amounts to which the
holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise
acquire for consideration shares of any stock ranking junior
(either as to dividends or upon liquidation, dis solution, or
winding up) to the Series A Preferred Stock, provided that the
corporation may at any time redeem, purchase, or otherwise
acquire shares of any such junior stock in exchange for shares
of any stock of the corporation ranking junior (either as to
dividends or upon dissolution, liquidation, or winding up) to
the Series A Preferred Stock; or
(iv) redeem or purchase or otherwise acquire
for consideration any shares of Series A Preferred Stock, or
any shares of stock ranking on a parity with the Series A
Preferred Stock, except in accordance with a purchase offer
made in writing or by publication (as determined by the Board
of Directors) to all holders of such shares upon such terms as
the Board of Directors, after consideration of the respective
annual dividend rates and other relative rights and
preferences of the respective series and classes, shall
determine in good faith will result in fair and equitable
treatment among the respective series or classes.
(B) The corporation shall not permit any subsidiary
of the corporation to purchase or otherwise acquire for
consideration any shares of stock of the corporation unless
the corporation could, under paragraph (A) of this Section 4,
purchase or otherwise acquire such shares at such time and in
such manner.
16.
Section 5. Reacquired Shares. Any shares of Series A Preferred
Stock purchased or otherwise acquired by the corporation in
any manner whatsoever shall be retired and canceled promptly
after the acquisition thereof. All such shares shall upon
their cancellation become authorized but unissued shares of
Preferred Stock and may be reissued as part of a new series of
Preferred Stock subject to the conditions and restrictions on
issuance set forth herein, in the Articles of Incorporation,
or in any other Articles of Amendment creating a series of
Preferred Stock, par value $0.50 per share, or any similar
stock or as otherwise required by law.
Section 6. Liquidation, Dissolution, or Winding Up. Upon any
liquidation, dissolution, or winding up of the corporation, no
distribution shall be made (1) to the holder of shares of
stock ranking junior (either as to dividends or upon
liquidation, dissolution, or winding up) to the Series A
Preferred Stock unless the holders of shares of Series A
Preferred Stock outstanding shall have received out of the
assets of the Company available for distribution to its
shareholders after payment or provision for payment of any
securities ranking senior to the Series A Preferred Stock, for
each share of Series A Preferred Stock, subject to adjustment
as hereinafter provided, (A) $1000.00 plus an amount equal to
accrued and unpaid dividends and distributions thereon,
whether or not declared, to the date of such payment or, (B)
if greater than the amount specified in clause (1)(A) of this
sentence, an amount equal to 1000 times the aggregate amount
to be distributed per share to holders of Common Stock, as the
same may be adjusted as herein provided, or (2) to the holders
of shares of stock ranking on a parity (either as to dividends
or upon liquidation, dissolution, or winding up) with the
Series A Preferred Stock, unless simultaneously therewith
distributions are made ratably on the Series A Preferred Stock
and all such parity stock in proportion to the total amounts
to which the holders of all such shares are entitled upon such
liquidation, dissolution, or winding up. In the event the
corporation shall at any time declare or pay any dividend on
the Common Stock payable in shares of Common Stock, or effect
a subdivision or combination or consolidation of the
outstanding shares of Common
17.
Stock (by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or lesser
number of shares of Common Stock, then in each such case the
aggregate amount to which holders of shares of Series A
Preferred Stock were entitled immediately prior to such event
under the provision in clause (1) of the preceding sentence
shall be adjusted by multiplying such amount by a fraction the
numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator
of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the corporation
shall enter into any consolidation, merger, combination, or
other transaction in which the shares of Common Stock are
exchanged for or changed into other stock or securities, cash,
and/or any other property, then in any such case each share of
Series A Preferred Stock shall at the same time be similarly
exchanged or changed into an amount per share, subject to the
provision for adjustment hereinafter set forth, equal to 1000
times the aggregate amount of stock, securities, cash, and/or
any other property (payable in kind), as the case may be, into
which or for which each share of Common Stock is changed or
exchanged. In the event the corporation shall at any time
declare or pay any dividend on the Common Stock payable in
shares of Common Stock, or effect a subdivision or combination
or consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in
shares of Common Stock) into a greater or lesser number of
shares of Common Stock, then in each such case the amount set
forth in the preceding sentence with respect to the exchange
or change of shares of Series A Preferred Stock shall be
adjusted by multiplying such amount by a fraction, the
numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator
of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
18.
Section 8. No Redemption. The shares of Series A
Preferred Stock shall not be redeemable.
Section 9. Rank. The Series A Preferred Stock shall rank, with
respect to the payment of dividends and the distribution of
assets, junior to all other series of the corporation's
Preferred Stock.
Section 10. Amendment. The Articles of Incorporation of the
corporation shall not be amended in any manner that would
materially alter or change the powers, preferences, or special
rights of the Series A Preferred Stock so as to affect them
adversely without the affirmative vote of the holders of at
least two-thirds of the outstanding shares of Series A
Preferred Stock, voting together as a single class.
19.
Exhibit 4.1
20.
---------------------------------------------------------
Mylan Laboratories Inc.
and
American Stock Transfer & Trust Company
Rights Agent
Rights Agreement
Dated as of August 22, 1996
---------------------------------------------------------
TABLE OF CONTENTS
Page
Section 1. Certain Definitions...........................................1
Section 2. Appointment of Rights Agent...................................6
Section 3. Issue of Right Certificates...................................6
Section 4. Form of Right Certificates....................................9
Section 5. Countersignature and Registration.............................9
Section 6. Transfer, Split Up, Combination, and Exchange of
Right Certificates; Mutilated, Destroyed, Lost,
or Stolen Right Certificates........................10
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights...........................11
Section 8. Cancellation and Destruction of Right Certificates...........15
Section 9. Reservation and Availability of Capital Stock................15
Section 10. Preferred Shares Record Date.................................18
Section 11. Adjustment of Purchase Price, Number of Shares,
or Number of Rights.................................19
Section 12. Certificate of Adjusted Purchase Price
or Number of Shares.................................29
Section 13. Consolidation, Merger, or Sale or Transfer of Assets
or Earning Power....................................29
Section 14. Fractional Rights and Fractional Shares......................34
Section 15. Rights of Action.............................................35
Section 16. Agreement of Right Holders...................................36
Section 17. Right Certificate Holder Not Deemed a Stockholder............37
Section 18. Concerning the Rights Agent..................................38
Section 19. Merger or Consolidation or Change of Name of Rights Agent....38
Section 20. Duties of Rights Agent.......................................39
Section 21. Change of Rights Agent.......................................42
Section 22. Issuance of New Right Certificates .................44
Section 23. Redemption...................................................44
Section 24. Exchange.....................................................46
Section 25. Notice of Certain Event......................................48
Section 26. Notices......................................................49
Section 27. Supplements and Amendments...................................50
Section 28. Successors...................................................51
Section 29. Benefits of this Agreement...................................51
Section 30. Determinations and Actions by the Board of Directors.........52
Section 31. Severability.................................................53
Section 32. Governing Law................................................53
Section 33. Counterparts.................................................53
Section 34. Descriptive Headings.........................................53
Signatures.................................................................54
Exhibit A - Form of Resolution to Amend Articles of Incorporation
Exhibit B - Form of Right Certificate
Exhibit C - Summary of Rights
RIGHTS AGREEMENT
RIGHTS AGREEMENT, dated as of August 22, 1996, between MYLAN LABORATORIES
INC., a Pennsylvania corporation (the "Company"), and AMERICAN STOCK TRANSFER &
TRUST COMPANY (the "Rights Agent").
WITNESSETH
WHEREAS, the Board of Directors of the Company has authorized and
declared a dividend of one preferred share purchase right (a "Right") for each
Common Share (as hereinafter defined) of the Company outstanding on September 5,
1996 (the "Record Date"), each Right representing the right to purchase one
one-thousandth of a Preferred Share (as hereinafter defined), upon the terms and
subject to the conditions herein set forth, and has further authorized and
directed the issuance of one Right with respect to each Common Share that shall
become outstanding between the Record Date and the earliest of the Distribution
Date, the Redemption Date, and the Final Expiration Date (as such terms are
hereinafter defined).
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties, intending to be legally bound, hereby
agree as follows:
Section 1. Certain definitions. For purposes of this Agreement, the
following terms have the meanings indicated:
(a) "Acquiring Person" shall mean any Person (as such term is hereinafter
defined) who or which, together with all Affiliates and Associates (as such
terms are hereinafter defined) of such Person, shall be the Beneficial Owner (as
such term is hereinafter defined) of 15% or more of the Common Shares of the
Company then outstanding, but shall not include the Company, any Subsidiary (as
such term is hereinafter defined) of the Company, any employee benefit plan of
the
1.
Company or of any Subsidiary of the Company, or any entity holding Common Shares
for or pursuant to the terms of any such plan. Notwithstanding the foregoing:
(i) no Person shall become an "Acquiring Person" as the result of an
acquisition of Common Shares by the Company which, by reducing the number
of shares outstanding, increases the proportionate number of shares
Beneficially Owned by such Person, together with all Affiliates and
Associates of such Person, to 15% or more of the Common Shares of the
Company then outstanding; provided, however, that if a Person, together
with all Affiliates and Associates of such Person, shall become the
Beneficial Owner of 15% or more of the Common Shares of the Company then
outstanding by reason of share purchases by the Company and shall, after
such share purchases by the Company, become the Beneficial Owner of any
additional Common Shares of the Company, then such Person shall be deemed
to be an "Acquiring Person;"
(ii) if the Board of Directors of the Company determines in good faith
that a Person who would otherwise be an "Acquiring Person," as defined
pursuant to the foregoing provisions of this paragraph (a), has become such
inadvertently, and such Person divests as promptly as practicable a
sufficient number of Common Shares so that such Person would no longer be
an "Acquiring Person," as defined pursuant to the foregoing provisions of
this paragraph (a), then such Person shall not be deemed to be an
"Acquiring Person" for any purposes of this Agreement.
(b) "Act" shall mean the Securities Act of 1933, as amended.
(c) "Adverse Change of Control" shall have the meaning set forth in
Section 23 hereof.
2.
(d) "Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 of the General Rules and Regulations
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
as in effect on the date of this Agreement; provided, however, that no
director or officer of the Company shall be deemed an Affiliate or
Associate of any other director or officer of the Company solely as a
result of his or her being a director or officer of the Company.
(e) A Person shall be deemed the "Beneficial Owner" of and shall be
deemed to "Beneficially Own" and to have "Beneficial Ownership" of any
securities:
(i) which such Person or any of such Person's Affiliates or
Associates beneficially owns, directly or indirectly (as determined
pursuant to Rule 13d-3 of the General Rules and Regulations under the
Exchange Act as in effect on the date of this Agreement);
(ii) which such Person or any of such Person's Affiliates or
Associates has (A) the right to acquire (whether such right is
exercisable immediately or only after the passage of time) pursuant to
any agreement, arrangement, or understanding (other than customary
agreements with and between underwriters and selling group members
with respect to a bona fide public offering of securities), or upon
the exercise of conversion rights, exchange rights, rights (other than
these Rights), warrants or options, or otherwise; provided, however,
that a Person shall not be deemed the Beneficial Owner of, or to
Beneficially Own or to have Beneficial Ownership of, (1) securities
tendered pursuant to a tender or exchange offer made by or on behalf
of such Person or any of such Person's Affiliates or Associates until
such tendered securities are accepted for purchase or exchange or (2)
securities issuable upon exercise of the Rights at any time prior to
the Distribution Date; or (B) the right to vote pursuant to any
agreement, arrangement, or understanding; provided, however, that a
Person
3.
shall not be deemed the Beneficial Owner of, or to Beneficially Own or
to have Beneficial Ownership of, any security if the agreement,
arrangement, or understanding to vote such security (1) arises solely
from a revocable proxy given to such Person in response to a public
proxy solicitation made pursuant to, and in accordance with, the
applicable rules and regulations promulgated under the Exchange Act
and (2) is not also then reportable on Schedule 13D under the Exchange
Act (or any comparable or successor report); or
(iii) which are beneficially owned, directly or indirectly, by
any other Person with which such Person or any of such Person's
Affiliates or Associates has any agreement, arrangement, or
understanding (other than customary agreements with and between
underwriters and selling group members with respect to a bona fide
public offering of securities) for the purpose of acquiring, holding,
voting (except to the extent contemplated by the proviso to Section
1(d)(ii)(B)), or disposing of any securities of the Company.
Notwithstanding anything in this definition of Beneficial Ownership to
the contrary, the
phrase "then outstanding," when used with reference to a Person's Beneficial
Ownership of securities of the Company, shall mean the number of such securities
then issued and outstanding together with the number of such securities not then
actually issued and outstanding that such Person would be deemed to own
beneficially hereunder.
(f) "Business Day" shall mean any day other than a Saturday, a Sunday, or a
day on which banking institutions in New York, New York are authorized or
obligated by law or executive order to close.
4.
(g) "Close of business" on any given date shall mean 5:00 P.M., New York,
New York time, on such date; provided, however, that if such date is not a
Business Day it shall mean 5:00 P.M., New York, New York time, on the next
succeeding Business Day.
(h) "Common Shares" when used with reference to the Company shall mean the
shares of Common Stock, par value $0.50 per share, of the Company. "Common
Shares" when used with reference to any Person other than the Company shall mean
the capital stock (or equity interest) with the greatest voting power of such
other Person.
(i) "Continuing Director" shall mean (i) any member of the Board of
Directors of the Company, while such person is a member of the Board, who is not
an Acquiring Person or an Affiliate or Associate of an Acquiring Person, or a
representative of an Acquiring Person or of any such Affiliate or Associate, and
was a member of the Board prior to the Record Date, or (ii) any person who
subsequently becomes a member of the Board who, while such person is a member of
the Board, is not an Acquiring Person or an Affiliate or Associate of an
Acquiring Person, or a representative of an Acquiring Person or of any such
Affiliate or Associate, if such Person's nomination for election or election to
the Board is recommended or approved by a majority of the Continuing Directors.
(j) "Distribution Date" shall have the meaning set forth in Section 3
hereof.
(k) "Exchange Act" shall have the meaning set forth in Section 1(d) hereof.
(l) "Final Expiration Date" shall have the meaning set forth in Section 7
hereof.
(m) "Person" shall mean any individual, firm, corporation, or other entity,
and shall include any successor (by merger or otherwise) of such entity.
5.
(n) "Preferred Shares" shall mean shares of Series A Junior Participating
Preferred Stock, par value $0.50 per share, of the Company having the rights and
preferences set forth in the Form of Resolution to Amend the Articles of
Incorporation to Establish Series of Preferred Shares attached to this Agreement
as Exhibit A.
(o) "Redemption Date" shall have the meaning set forth in Section 7 hereof.
(p) "Shares Acquisition Date" shall mean the first date of public
announcement by the Company or an Acquiring Person that an Acquiring Person has
become such.
(q) "Subsidiary" of any Person shall mean any corporation or other entity
of which a majority of the voting power of the voting equity securities or
equity interest is owned, directly or indirectly, by such Person.
(r) "Triggering Event" shall mean any event described in Section 11(a)(ii)
hereof or any Section 13(a) Event (as such term is defined in Section 13(a)
hereof).
Section 2. Appointment of Rights Agent. The Company hereby appoints the
Rights Agent to act as agent for the Company and the holders of the Rights (who,
in accordance with Section 3 hereof, shall prior to the Distribution Date also
be the holders of the Common Shares) in accordance with the terms and conditions
hereof, and the Rights Agent hereby accepts such appointment. The Company may
from time to time appoint such co-Rights Agents as it may deem necessary or
desirable.
Section 3. Issue of Right Certificates. (a) Until the earlier of (i) the
tenth day after the Shares Acquisition Date or (ii) the tenth day (or such later
date as may be determined by action of the Board of Directors prior to such time
as any Person becomes an Acquiring Person) after the date of the commencement by
any Person (other than the Company, any Subsidiary of the Company, any
6.
employee benefit plan of the Company or of any Subsidiary of the Company,
or any entity holding Common Shares for or pursuant to the terms of any such
plan) of, or of the first public announcement of the intention of any Person
(other than the Company, any Subsidiary of the Company, any employee benefit
plan of the Company or of any Subsidiary of the Company, or any entity holding
Common Shares for or pursuant to the terms of any such plan) to commence, a
tender or exchange offer, the consummation of which would result in any Person
becoming the Beneficial Owner of Common Shares aggregating 15% or more of the
then outstanding Common Shares (including any such date which is after the date
of this Agreement and prior to the issuance of the Rights; the earlier of such
dates being herein referred to as the "Distribution Date"), (x) the Rights will
be evidenced (subject to the provisions of Section 3(b) hereof) by the
certificates for Common Shares registered in the names of the holders thereof
(which certificates shall also be deemed to be Right Certificates) and not by
separate Right Certificates, and (y) the right to receive Right Certificates
will be transferable only in connection with the transfer of Common Shares. As
soon as practicable after the Distribution Date, the Company will prepare and
execute, the Rights Agent will countersign, and the Company will send or cause
to be sent (and the Rights Agent will, if requested, send) by first-class,
insured, postage-prepaid mail, to each record holder of Common Shares as of the
close of business on the Distribution Date, at the address of such holder shown
on the records of the Company, a Right Certificate, in substantially the form of
Exhibit B hereto (a "Right Certificate"), evidencing one Right for each Common
Share so held. As of the Distribution Date, the Rights will be evidenced solely
by such Right Certificates.
(b) On the Record Date, or as soon as practicable thereafter, the Company
will send a copy of a Summary of Rights to Purchase Preferred Shares, in
substantially the form of Exhibit C
7.
hereto (the "Summary of Rights"), by first-class, postage-prepaid mail, to each
record holder of Common Shares as of the close of business on the Record Date,
at the address of such holder shown on the records of the Company. With respect
to certificates for Common Shares outstanding as of the Record-Date, until the
Distribution Date, the Rights will be evidenced by such certificates registered
in the names of the holders thereof together with a copy of the Summary of
Rights attached thereto. Until the Distribution Date (or the earlier of the
Redemption Date or the Final Expiration Date), the surrender for transfer of any
certificate for Common Shares outstanding on the Record Date, with or without a
copy of the Summary of Rights attached thereto, shall also constitute the
transfer of the Rights associated with the Common Shares represented thereby.
(c) Certificates for Common Shares that become outstanding (including,
without limitation, reacquired Common Shares referred to in the last sentence of
this paragraph (c)) after the Record Date but prior to the earliest of the
Distribution Date, the Redemption Date, or the Final Expiration Date shall have
impressed on, printed on, written on, or otherwise affixed to them the following
legend:
This certificate also evidences and entitles the holder hereof to certain
rights as set forth in a Rights Agreement between Mylan Laboratories Inc.
and American Stock Transfer & Trust Company, dated as of August 22, 1996
(the "Rights Agreement"), the terms of which are hereby incorporated herein
by reference and a copy of which is on file at the principal executive
offices of Mylan Laboratories Inc. Under certain circumstances, as set
forth in the Rights Agreement, such Rights will be evidenced by separate
certificates and will no longer be evidenced by this certificate. Mylan
Laboratories Inc. will mail to the holder of this certificate a copy of the
Rights Agreement without charge after receipt of a written request
therefor. Under certain circumstances, as set forth in the Rights
Agreement, Rights that are or were beneficially owned by any Person who
becomes an Acquiring Person or any Associate or Affiliate of such Acquiring
Person (as such terms are defined in the Rights Agreement) or specified
transferees of such Acquiring Person (or Associate or Affiliate thereof)
may become null and void.
8.
With respect to such certificates containing the foregoing legend, until the
Distribution Date, the Rights associated with the Common Shares represented by
such certificates shall be evidenced by such certificates alone, and the
surrender for transfer of any such certificate shall also constitute the
transfer of the Rights associated with the Common Shares represented thereby. In
the event that the Company purchases or acquires any Common Shares after the
Record Date but prior to the Distribution Date, any Rights associated with such
Common Shares shall be deemed canceled and retired so that the Company shall not
be entitled to exercise any Rights associated with the Common Shares that are no
longer outstanding.
Section 4. Form of Right Certificates. The Right Certificates (and the
forms of election to purchase Preferred Shares and of assignment to be printed
on the reverse thereof) shall be substantially the same as Exhibit B hereto and
may have such marks of identification or designation and such legends,
summaries, or endorsements printed thereon as the Company may deem appropriate
and as are not inconsistent with the provisions of this Agreement, or as may be
required to comply with any applicable law or with any rule or regulation made
pursuant thereto or with any rule or regulation of any stock exchange on which
the Rights may from time to time be listed, or to conform to usage. Subject to
the provisions of Sections 7, 11, 13, 22, 24, and 27 hereof, the Right
Certificates shall entitle the holders thereof to purchase such number of one
one-thousandths of a Preferred Share as shall be set forth therein at the price
per one one-thousandth of a Preferred Share set forth therein (the "Purchase
Price"), but the number of such one one-thousandths of a Preferred Share and the
Purchase Price shall be subject to adjustment as provided herein.
Section 5. Countersignature and Registration. The Right Certificates shall
be executed on behalf of the Company by its Chairman of the Board, its Chief
Executive Officer, its President,
9.
any of its Vice Presidents, or its Treasurer, either manually or by facsimile
signature, shall have affixed thereto the Company's seal or a facsimile thereof,
and shall be attested by the Secretary or an Assistant Secretary of the Company,
either manually or by facsimile signature. The Right Certificates shall be
manually countersigned by the Rights Agent and shall not be valid for any
purpose unless countersigned. In case any officer of the Company who shall have
signed any of the Right Certificates shall cease to be such officer of the
Company before countersignature by the Rights Agent and issuance and delivery by
the Company, such Right Certificates, nevertheless, may be countersigned by the
Rights Agent and issued and delivered by the Company with the same force and
effect as though the person who signed such Right Certificates had not ceased to
be such officer of the Company; and any Right Certificate may be signed on
behalf of the Company by any person who, at the actual date of the execution of
such Right Certificate, shall be a proper officer of the Company to sign such
Right Certificate, although at the date of the execution of this Rights
Agreement any such person was not such an officer.
Following the Distribution Date, the Rights Agent will keep or cause to be
kept, at its principal office, books for registration and transfer of the Right
Certificates issued hereunder. Such books shall show the names and addresses of
the respective holders of the Right Certificates, the number of Rights evidenced
on its face by each of the Right Certificates, and the date of each of the Right
Certificates.
Section 6. Transfer, Split Up, Combination, and Exchange of Right
Certificates; Mutilated, Destroyed, Lost, or Stolen Right Certificates. Subject
to the provisions of Section 14 hereof, at any time after the close of business
on the Distribution Date, and at or prior to the close of business on the
earlier of the Redemption Date or the Final Expiration Date, any Right
Certificate
10.
or Right Certificates (other than Right Certificates representing Rights that
have become void pursuant to Section 7(e) hereof, that have been redeemed
pursuant to Section 23 hereof, or that have been exchanged pursuant to Section
24 hereof) may be transferred, split up, combined, or exchanged for another
Right Certificate or Right Certificates, entitling the registered holder to
purchase a like number of one one-thousandths of a Preferred Share as the Right
Certificate or Right Certificates surrendered then entitled such holder to
purchase. Any registered holder desiring to transfer, split up, combine, or
exchange any Right Certificate or Right Certificates shall make such request in
writing delivered to the Rights Agent, and shall surrender the Right Certificate
or Right Certificates to be transferred, split up, combined, or exchanged at the
principal office of the Rights Agent. Thereupon the Rights Agent shall
countersign and deliver to the person entitled thereto a Right Certificate or
Right Certificates, as the case may be, as so requested. The Company may require
payment of a sum sufficient to cover any tax or governmental charge that may be
imposed in connection with any transfer, split up, combination, or exchange of
Right Certificates.
Upon receipt by the Company and the Rights Agent of evidence reasonably
satisfactory to them of the loss, theft, destruction, or mutilation of a Right
Certificate, and, in case of loss, theft, or destruction, of indemnity or
security reasonably satisfactory to them, and, at the Company's request,
reimbursement to the Company and the Rights Agent of all reasonable expenses
incidental thereto, and upon surrender to the Rights Agent and cancellation of
the Right Certificate if mutilated, the Company will make and deliver a new
Right Certificate of like tenor to the Rights Agent for delivery to the
registered holder in lieu of the Right Certificate so lost, stolen, destroyed,
or mutilated.
Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights.
11.
(a) Subject to Section 7(e) hereof, the registered holder of any Right
Certificate may exercise the Rights evidenced thereby (except as otherwise
provided herein) in whole or in part at any time after the Distribution Date
upon surrender of the Right Certificate, with the form of election to purchase
on the reverse side thereof duly executed, to the Rights Agent at the principal
office of the Rights Agent designated for such purpose, together with payment of
the Purchase Price for each one one-thousandth of a Preferred Share (or after a
Triggering Event, the securities, cash, and/or other property purchasable in
lieu thereof) as to which the Rights are exercised, at or prior to the earliest
of (i) the close of business on September 5, 2006 (the "Final Expiration Date"),
(ii) the time at which the Rights are redeemed as provided in Section 23 hereof
(the "Redemption Date"), or (iii) the time at which such Rights are exchanged as
provided in Section 24 hereof.
(b) The Purchase Price for each one one-thousandth of a Preferred Share
purchasable pursuant to the exercise of a Right shall initially be $90, and
shall be subject to adjustment from time to time as provided in Section 11 or 13
hereof and shall be payable in lawful money of the United States of America in
accordance with paragraph (c) below.
(c) Upon receipt of a Right Certificate representing exercisable Rights,
with the form of election to purchase duly executed, accompanied by payment of
the Purchase Price for the shares to be purchased and an amount equal to any
applicable transfer tax required to be paid by the holder of such Right
Certificate in accordance with Section 9 hereof by certified check, cashier's
check, or money order payable to the order of the Company, the Rights Agent
shall thereupon promptly (i) (A) requisition from any transfer agent of the
Preferred Shares certificates for the number of Preferred Shares to be purchased
and the Company hereby irrevocably authorizes its transfer agent to comply with
all such requests, or (B) requisition from the depositary agent depositary
receipts representing
12.
such number of one one-thousandths of a Preferred Share as are to be purchased
(in which case certificates for the Preferred Shares represented by such
receipts shall be deposited by the transfer agent with the depositary agent) and
the Company hereby directs the depositary agent to comply with such request,
(ii) when appropriate, requisition from the Company the amount of cash to be
paid in lieu of issuance of fractional shares in accordance with Section 14
hereof, (iii) after receipt of such certificates or depositary receipts, cause
the same to be delivered to or upon the order of the registered holder of such
Right Certificate, registered in such name or names as may be designated by such
holder, and (iv) when appropriate, after receipt, deliver such cash to or upon
the order of the registered holder of such Right Certificate. In the event that
the Company is obligated, upon the exercise of any Rights, to issue other
securities (including Common Shares) of the Company or other property, the
Company will make all arrangements necessary so that such other securities or
property are available for distribution by the Rights Agent, if and when
appropriate.
(d) In case the registered holder of any Right Certificate shall exercise
less than all the Rights evidenced thereby, a new Right Certificate evidencing
Rights equivalent to the Rights remaining unexercised shall be issued by the
Rights Agent to the registered holder of such Right Certificate or to his duly
authorized assigns, subject to the provisions of Section 14 hereof.
(e) Notwithstanding anything in this Agreement to the contrary, from and
after the time that any Person becomes an Acquiring Person, any Rights that are
or were acquired or Beneficially Owned by (i) any Acquiring Person (or any
Associate or Affiliate of such Acquiring Person); (ii) any transferee of an
Acquiring Person (or any Associate or Affiliate of such Acquiring Person) who
becomes a transferee after the Acquiring Person becomes such; or (iii) any
transferee of an Acquiring Person (or any Associate or Affiliate of such
Acquiring Person) who becomes a transferee prior to
13.
or concurrently with the Acquiring Person becoming such and receives such Rights
pursuant to either (A) a transfer (whether or not for consideration) from such
Acquiring Person (or any Affiliate or Associate of such Acquiring Person) to
holders of equity interests in such Acquiring Person (or any Affiliate or
Associate of such Acquiring Person) or to any Person with whom such Acquiring
Person (or any Affiliate or Associate of such Acquiring Person) has any
continuing written or oral agreement or understanding regarding the transferred
Rights or (B) a transfer that the Board of Directors of the Company has
determined in good faith is part of a plan, arrangement, or understanding that
has as a primary purpose or effect the avoidance of this Section 7(e), shall be
null and void without any further action, and any holder of such Rights shall
thereafter have no rights whatsoever with respect to such Rights, whether under
any provision of this Agreement or otherwise (including, without limitation,
rights pursuant to Sections 7, 11, 13, 23, and 24 hereof). No Right Certificate
shall be issued pursuant to Section 3 or Section 22 hereof that represents
Rights Beneficially Owned by any Person whose Rights would be void pursuant to
the preceding sentence; no Right Certificate shall be issued at any time
pursuant to Section 6 hereof upon the transfer of any Rights to any Person (or
any nominee of such Person) whose Rights would be void pursuant to the preceding
sentence upon such transfer; no Right Certificate shall be issued at any time
pursuant to Section 6 or Section 11 hereof upon the transfer, split up,
combination, exchange, replacement, or adjustment of any Rights Beneficially
Owned by any Person (or any nominee of such Person) whose Rights would be void
pursuant to the preceding sentence; and any Right Certificate delivered to the
Rights Agent for transfer to any Person (or any nominee of such Person) whose
Rights would be void pursuant to the preceding sentence shall be canceled. The
Company shall use all reasonable efforts to insure compliance with the
provisions of this Section 7(e), but shall have no liability to any holder of
Right
14.
Certificates or any other Person as a result of its failure to make any
determinations hereunder with respect to an Acquiring Person or its Affiliates,
Associates, or transferees.
(f) Notwithstanding anything in this Agreement to the contrary, neither the
Rights Agent nor the Company shall be obligated to undertake any action with
respect to a registered holder upon the occurrence of any purported exercise as
set forth in this Section 7 unless such registered holder shall have (i)
completed and signed the certificate contained in the form of election to
purchase set forth on the reverse side of the Right Certificate surrendered for
such exercise, and (ii) provided such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates
thereof as the Company shall reasonably request.
Section 8. Cancellation and Destruction of Right Certificates. All Right
Certificates surrendered for the purpose of exercise, transfer, split up,
combination, or exchange shall, if surrendered to the Company or to any of its
agents, be delivered to the Rights Agent for cancellation or in cancelled form,
or, if surrendered to the Rights Agent, shall be cancelled by it, and no Right
Certificates shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Rights Agreement. The Company shall deliver to the
Rights Agent for cancellation and retirement, and the Rights Agent shall so
cancel and retire, any other Right Certificate purchased or acquired by the
Company otherwise than upon the exercise thereof. The Rights Agent shall deliver
all cancelled Right Certificates to the Company, or shall, at the written
request of the Company, destroy such cancelled Right Certificates, and in such
case shall deliver a certificate of destruction thereof to the Company.
Section 9. Reservation and Availability of Capital Stock.
15.
(a) The Company covenants and agrees that it will cause to be reserved and
kept available out of its authorized and unissued Preferred Shares or any
Preferred Shares held in its treasury (and, following the occurrence of a
Triggering Event, out of its authorized and unissued Common Shares and/or other
securities or out of any Common Shares or other securities held in its
treasury), the number of Preferred Shares (and, following the occurrence of a
Triggering Event, Common Shares and/or other securities) that will be sufficient
to permit the exercise in full of all outstanding Rights in accordance with this
Agreement.
(b) So long as the Preferred Shares (and, following the occurrence of a
Triggering Event, Common Shares and/or other securities) issuable and
deliverable upon the exercise of the Rights may be listed on any national
securities exchange or automated quotation system, the Company shall use its
best efforts to cause, from and after such time as the Rights become
exercisable, all shares reserved for such issuance to be listed on such exchange
or quotation system upon official notice of issuance upon such exercise.
(c) The Company shall use its best efforts to (i) file, as soon as
practicable following the earliest date after the first occurrence of an event
described in Section 11(a)(ii) hereof on which the consideration to be delivered
by the Company upon exercise of the Rights has been determined in accordance
with Section 11(a)(iii) hereof, or as soon as required by law following the
Distribution Date, as the case may be, a registration statement under the Act
with respect to the securities purchasable upon exercise of the Rights on an
appropriate form, (ii) cause such registration statement to become effective as
soon as practicable after such filing, and (iii) cause such registration
statement to remain effective (with a prospectus at all times meeting the
requirements of the Act) until the earlier of (A) the date as of which the
Rights are no longer exercisable for such securities, and (B)
16.
the date of the expiration of the Rights. The Company will also take such action
as may be appropriate under, or to ensure compliance with, the securities or
"blue sky" laws of the various states in connection with the exercisability of
the Rights. The Company may temporarily suspend, for a period of time not to
exceed 90 days after the date set forth in clause (i) of the first sentence of
this Section 9(c), the exercisability of the Rights in order to prepare and file
such registration statement and permit it to become effective. Upon any such
suspension, the Company shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended, as well as a public
announcement at such time as the suspension is no longer in effect stating that
the suspension on the exercisability of the Rights is no longer in effect.
Notwithstanding any provision of this Agreement to the contrary, the Rights
shall not be exercisable in any jurisdiction (x) if the requisite qualification
in such jurisdiction shall not have been obtained and until a registration
statement has been declared effective or (y) if the exercise thereof shall not
be permitted under applicable law.
(d) The Company covenants and agrees that it will take all such action as
may be necessary to ensure that all one one-thousandths of a Preferred Share
(and following the occurrence of a Triggering Event, Common Shares and/or other
securities) delivered upon exercise of Rights shall, at the time of delivery of
the certificates for such shares (subject to payment of the Purchase Price), be
duly and validly authorized and issued and fully paid and nonassessable.
(e) The Company further covenants and agrees that it will pay when due and
payable any and all federal and state transfer taxes and charges that may be
payable in respect of the issuance or delivery of the Right Certificates or of
any certificates or depositary receipts for Preferred Shares (or Common Shares
and/or other securities, as the case may be) upon exercise of the Rights. The
17.
Company shall not, however, be required to pay any transfer tax that may be
payable in respect of any transfer or delivery of Right Certificates to a person
other than, or the issuance or delivery of certificates or depositary receipts
for the Preferred Shares (or Common shares and/or other securities, as the case
may be) in a name other than that of, the registered holder of the Right
Certificates evidencing Rights surrendered for exercise or to issue or to
deliver any certificates or depositary receipts for Preferred Shares (or Commons
Shares and/or other securities, as the case may be) in a name other than that of
the registered holder upon the exercise of any Rights until any such tax shall
have been paid (any such tax being payable by the holder of such Right
Certificate at the time of surrender) or until it has been established to the
Company's reasonable satisfaction that no such tax is due.
Section 10. Preferred Shares Record Date. Each person in whose name any
certificate for Preferred Shares is issued upon the exercise of Rights shall for
all purposes be deemed to have become the holder of record of the Preferred
Shares represented thereby on, and such certificate shall be dated, the date
upon which the Right Certificate evidencing such Rights was duly surrendered and
payment of the Purchase Price (and any applicable transfer taxes) was made;
provided, however, that if the date of such surrender and payment is a date upon
which the Preferred Shares transfer books of the Company are closed, such person
shall be deemed to have become the record holder of such shares on, and such
certificate shall be dated, the next succeeding Business Day on which the
Preferred Shares transfer books of the Company are open. Prior to the exercise
of the Rights evidenced thereby, the holder of a Right Certificate shall not be
entitled to any rights of a holder of Preferred Shares for which the Rights
shall be exercisable, including, without limitation, the right
18.
to vote, to receive dividends or other distributions, or to exercise any
preemptive rights, and shall not be entitled to receive any notice of any
proceedings of the Company, except as provided herein.
Section 11. Adjustment of Purchase Price, Number of Shares, or Number of
Rights. The Purchase Price, the number of Preferred Shares covered by each
Right, and the number of Rights outstanding are subject to adjustment from time
to time as provided in this Section 11.
(a)(i) In the event the Company shall at any time after the date of this
Agreement (A) declare a dividend on the Preferred Shares payable in Preferred
Shares, (B) subdivide the outstanding Preferred Shares, (C) combine the
outstanding Preferred Shares into a smaller number of Preferred Shares, or (D)
issue any shares of its capital stock in a reclassification of the Preferred
Shares (including any such reclassification in connection with a consolidation
or merger in which the Company is the continuing or surviving corporation),
except as otherwise provided in this Section 11(a), the Purchase Price in effect
at the time of the record date for such dividend or of the effective date of
such subdivision, combination, or reclassification, and the number and kind of
shares of capital stock issuable on such date, shall be proportionately adjusted
so that the holder of any Right exercised after such time shall be entitled to
receive the aggregate number and kind of shares of capital stock that, if such
Right had been exercised immediately prior to such date and at a time when the
Preferred Shares transfer books of the Company were open, he would have owned
upon such exercise and been entitled to receive by virtue of such dividend,
subdivision, combination, or reclassification. If an event occurs that would
require an adjustment under both this Section 11(a)(i) and Section 11(a)(ii)
hereof, the adjustment provided for in this Section 11(a)(i) shall be in
addition to, and shall be made prior to, any adjustment required pursuant to
Section 11(a)(ii) hereof.
19.
(ii) Subject to Sections 7(e), 13(a), and 24 of this Agreement, in the
event any Person becomes an Acquiring Person, each holder of a Right shall
thereafter have a right to receive, upon exercise thereof at a price equal to
the then current Purchase Price multiplied by the number of one one-thousandths
of a Preferred Share for which a Right is then exercisable, in accordance with
the terms of this Agreement and in lieu of Preferred Shares, such number of
Common Shares of the Company as shall equal the result obtained by (x)
multiplying the then current Purchase Price by the number of one one-thousandths
of a Preferred Share for which a Right is then exercisable and dividing that
Product by (y) 50% of the then current per share market price of the Company's
Common Shares (determined pursuant to Section 11(d) hereof) on the date of the
occurrence of such event.
(iii) In the event that there shall not be sufficient Common Shares issued
but not outstanding or authorized but unissued to permit the exercise in full of
the Rights in accordance with the foregoing subparagraph (ii), the Company shall
substitute, for each Common Share that would otherwise be issuable upon exercise
of a Right, a number of Preferred Shares or fraction thereof such that the
current per share market price of one Preferred Share multiplied by such number
or fraction is equal to the current per share market price of one Common Share
as of the date of issuance of such Preferred Shares or fraction thereof. In the
event there shall not be sufficient Preferred Shares issued but not outstanding
or authorized but unissued to permit the exercise in full of the Rights in
accordance with the foregoing sentence, the Company shall take all action as
shall be necessary to authorize additional Preferred Shares for issuance upon
exercise of the Rights. In the event the Company shall, after good faith effort,
be unable to take action sufficient to authorize such additional Preferred
Shares, the Company shall take all such action as may be necessary to authorize,
issue or
20.
pay, upon the exercise of the Rights, cash (including by way of a reduction of
the Purchase Price), property, other securities or any combination thereof
having an aggregate value equal to the value of the Preferred Shares of the
Company which otherwise would have been issuable pursuant to the first sentence
of this Section 11(a)(iii), which aggregate value shall be determined in good
faith by a majority of the Board of Directors. For purposes of the preceding
sentence, the value of the Preferred Shares shall be determined pursuant Section
11(d) hereof and the value of any equity securities which a majority of the
Board of Directors determines in good faith to be equivalent to the Common
Shares or "equivalent preferred shares" (as defined in Section 11(b)) shall be
deemed to have the same value as the Common Shares or Preferred Shares,
respectively. Any substitution of securities, property and/or cash under this
Section 11(a)(iii) shall be made and publicly announced within 60 days after the
date any Person becomes an Acquiring Person
(b) In case the Company shall fix a record date for the issuance of rights,
options, or warrants to all holders of Preferred Shares entitling them (for a
period expiring within 45 calendar days after such record date) to subscribe for
or purchase Preferred Shares (or shares having the same rights, privileges, and
preferences as the Preferred Shares ("equivalent preferred shares")) or
securities convertible into Preferred Shares or equivalent preferred shares at a
price per Preferred Share or equivalent preferred share (or having a conversion
price per share, if a security convertible into Preferred Shares or equivalent
preferred shares) less than the then current per share market price of the
Preferred Shares (as defined in Section 11(d)) on such record date, the Purchase
Price to be in effect after such record date shall be determined by multiplying
the Purchase Price in effect immediately prior to such record date by a
fraction, the numerator of which shall be the number of Preferred Shares
outstanding on such record date plus the number of Preferred Shares that the
21.
aggregate offering price of the total number of Preferred Shares and/or
equivalent preferred shares so to be offered (and/or the aggregate initial
conversion price of the convertible securities so to be offered) would purchase
at such current market price and the denominator of which shall be the number of
Preferred Shares outstanding on such record date plus the number of additional
Preferred Shares and/or equivalent preferred shares to be offered for
subscription or purchase (or into which the convertible securities so to be
offered are initially convertible). In case such subscription price may be paid
in a consideration part or all of which shall be in a form other than cash, the
value of such consideration shall be as determined in good faith by the Board of
Directors of the Company, whose determination shall be described in a statement
filed with the Rights Agent. Preferred Shares owned by or held for the account
of the Company shall not be deemed outstanding for the purpose of any such
computation. Such adjustment shall be made successively whenever such a record
date is fixed; and in the event that such rights, options, or warrants are not
so issued, the Purchase Price shall be adjusted to be the Purchase Price that
would then be in effect if such record date had not been fixed.
(c) In case the Company shall fix a record date for the making of a
distribution to all holders of the Preferred Shares (including any such
distribution made in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation) of evidences of indebtedness
or assets (other than a regular quarterly cash dividend or a dividend payable in
Preferred Shares) or subscription rights or warrants (excluding those referred
to in Section 11(b) hereof), the Purchase Price to be in effect after such
record date shall be determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the numerator of which
shall be the then current per share market price of the Preferred Shares on such
22.
record date, less the fair market value (as determined in good faith by the
Board of Directors of the Company, whose determination shall be described in a
statement filed with the Rights Agent) of the portion of the assets or evidences
of indebtedness so to be distributed or of such subscription rights or warrants
applicable to one Preferred Share and the denominator of which shall be such
current per share market price of the Preferred Shares. Such adjustments shall
be made successively whenever such a record date is fixed; and in the event that
such distribution is not so made, the Purchase Price shall again be adjusted to
be the Purchase Price that would then be in effect if such record date had not
been fixed.
(d)(i) For the purpose of any computation hereunder, the "current per share
market price" of any security (a "Security" for the purpose of this Section
11(d)(i)) on any date shall be deemed to be the average of the daily closing
prices per share of such Security for the 30 consecutive Trading Days (as such
term is hereinafter defined) immediately prior to such date; provided, however,
that in the event that the current per share market price of the Security is
determined during a period following the announcement by the issuer of such
Security of (A) a dividend or distribution on such Security payable in shares of
such Security or securities convertible into such shares, or (B) any
subdivision, combination, or reclassification of such Security and prior to the
expiration of 30 Trading Days after the ex-dividend date for such dividend or
distribution, or the record date for such subdivision, combination, or
reclassification, then, and in each such case, the current per share market
price shall be appropriately adjusted to reflect the current market price per
share equivalent of such Security. The closing price for each day shall be the
last sale price, regular way, or, in case no such sale takes place on such day,
the average of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system with respect
to
23.
securities listed or admitted to trading on the New York Stock Exchange or, if
the Security is not listed or admitted to trading on the New York Stock
Exchange, as reported in the principal consolidated transaction reporting system
with respect to securities listed on the principal national securities exchange
on which the Security is listed or admitted to trading or, if the Security is
not listed or admitted to trading on any national securities exchange, the last
quoted price or, if not so quoted, the average of the high bid and low asked
prices in the over-the-counter market, as reported by the National Association
of Securities Dealers, Inc. Automated Quotations System ("NASDAQ") or such other
system then in use, or, if on any such date the Security is not quoted by any
such organization, the average of the closing bid and asked prices as furnished
by a professional market maker making a market in the Security selected by the
Board of Directors of the Company. The term "Trading Day" shall mean a day on
which the principal national securities exchange on which the Security is listed
or admitted to trading is open for the transaction of business or, if the
Security is not listed or admitted to trading on any national securities
exchange, a Business Day.
(ii) For the purpose of any computation hereunder, the "current per share
market price" of the Preferred Shares shall be determined in accordance with the
method set forth in Section 11(d)(i). If the Preferred Shares are not publicly
traded, the "current per share market price" of the Preferred Shares shall be
conclusively deemed to be the current per share market price of the Common
Shares as determined pursuant to Section 11(d)(i) (appropriately adjusted to
reflect any stock split, stock dividend, or similar transaction occurring after
the date hereof), multiplied by 1,000. If neither the Common Shares nor the
Preferred Shares are publicly held or so listed or traded, "current per share
market price" shall mean the fair value per share as determined in good
24.
faith by the Board of Directors of the Company, whose determination shall be
described in a statement filed with the Rights Agent.
(e) No adjustment in the Purchase Price shall be required unless such
adjustment would require an increase or decrease of at least 1% in the Purchase
Price; provided, however, that any adjustments which by reason of this Section
11(e) are not required to be made shall be carried forward and taken into
account in any subsequent adjustment. All calculations under this Section 11
shall be made to the nearest cent or to the nearest one one-millionth of a
Preferred Share or one ten-thousandth of any other share or security as the case
may be. Notwithstanding the first sentence of this Section 11(e), any adjustment
required by this Section 11 shall be made no later than the earlier of (i) three
years from the date of the transaction that requires such adjustment or (ii) the
date of the expiration of the right to exercise any Rights.
(f) If as a result of an adjustment made pursuant to Section 11(a) hereof,
the holder of any Right thereafter exercised shall become entitled to receive
any shares of capital stock of the Company other than Preferred Shares,
thereafter the number of such other shares so receivable upon exercise of any
Right shall be subject to adjustment from time to time in a manner and on terms
as nearly equivalent as practicable to the provisions with respect to the
Preferred Shares contained in Section 11(a) through (c), inclusive, and the
provisions of Sections 7, 9, 10, and 13 with respect to the Preferred Shares
shall apply on like terms to any such other shares.
(g) All Rights originally issued by the Company subsequent to any
adjustment made to the Purchase Price hereunder shall evidence the right to
purchase, at the adjusted Purchase Price, the number of one one-thousandths of a
Preferred Share purchasable from time to time hereunder upon exercise of the
Rights, all subject to further adjustment as provided herein.
25.
(h) Unless the Company shall have exercised its election as provided in
Section 11(i), upon each adjustment of the Purchase Price as a result of the
calculations made in Sections 11(b) and (c), each Right outstanding immediately
prior to the making of such adjustment shall thereafter evidence the right to
purchase, at the adjusted Purchase Price, that number of one one-thousandths of
a Preferred Share (calculated to the nearest one one-millionth of a Preferred
Share) obtained by (i) multiplying (x) the number of one one-thousandths of a
share covered by a Right immediately prior to this adjustment by (y) the
Purchase Price in effect immediately prior to such adjustment of the Purchase
Price and (ii) dividing the product so obtained by the Purchase Price in effect
immediately after such adjustment of the Purchase Price.
(i) The Company may elect on or after the date of any adjustment of the
Purchase Price to adjust the number of Rights, in substitution for any
adjustment in the number of one one- thousandths of a Preferred Share
purchasable upon the exercise of a Right. Each of the Rights outstanding after
such adjustment of the number of Rights shall be exercisable for the number of
one one-thousandths of a Preferred Share for which a Right was exercisable
immediately prior to such adjustment. Each Right held of record prior to such
adjustment of the number of Rights shall become that number of Rights
(calculated to the nearest one ten-thousandth) obtained by dividing the Purchase
Price in effect immediately prior to adjustment of the Purchase Price by the
Purchase Price in effect immediately after adjustment of the Purchase Price. The
Company shall make a public announcement of its election to adjust the number of
Rights, indicating the record date for the adjustment, and, if known at the
time, the amount of the adjustment to be made. This record date may be the date
on which the Purchase Price is adjusted or any day thereafter, but, if the Right
Certificates have been issued, shall be at least 10 days later than the date of
the public
26.
announcement. If Right Certificates have been issued, upon each adjustment of
the number of Rights pursuant to this Section 11(i), the Company shall, as
promptly as practicable, cause to be distributed to holders of record of Right
Certificates on such record date Right Certificates evidenc ing, subject to
Section 14 hereof, the additional Rights to which such holders shall be entitled
as a result of such adjustment, or, at the option of the Company, shall cause to
be distributed to such holders of record in substitution and replacement for the
Right Certificates held by such holders prior to the date of adjustment, and
upon surrender thereof, if required by the Company, new Right Certificates
evidencing all the Rights to which such holders shall be entitled after such
adjustment. Right Certificates so to be distributed shall be issued, executed,
and countersigned in the manner provided for herein and shall be registered in
the names of the holders of record of Right Certificates on the record date
specified in the public announcement.
(j) Irrespective of any adjustment or change in the Purchase Price or the
number of one one-thousandths of a Preferred Share issuable upon the exercise of
the Rights, the Right Certificates theretofore and thereafter issued may
continue to express the Purchase Price and the number of one one-thousandths of
a Preferred Share that were expressed in the initial Right Certificates issued
hereunder.
(k) In any case in which this Section 11 shall require that an adjustment
in the Purchase Price be made effective as of a record date for a specified
event, the Company may elect to defer until the occurrence of such event the
issuing to the holder of any Right exercised after such record date of the
Preferred Shares and other capital stock or securities of the Company, if any,
issuable upon such exercise over and above the Preferred Shares and other
capital stock or securities of the Company, if any, issuable upon such exercise
on the basis of the Purchase Price in effect prior to
27.
such adjustment; provided, however, that the Company shall deliver to such
holder a due bill or other appropriate instrument evidencing such holder's right
to receive such additional shares upon the occurrence of the event requiring
such adjustment.
(l) Anything in this Section 11 to the contrary notwithstanding, the
Company shall be entitled to make such reductions in the Purchase Price, in
addition to those adjustments expressly required by this Section 11, as and to
the extent that it in its sole discretion shall determine to be advisable in
order that any consolidation or subdivision of the Preferred Shares, issuance
wholly for cash of any Preferred Shares at less than the current market price,
issuance wholly for cash of Preferred Shares or securities which by their terms
are convertible into or exchangeable for Preferred Shares, dividends on
Preferred Shares payable in Preferred Shares, or issuance of rights, options, or
warrants referred to hereinabove in Section 11(b), hereafter made by the Company
to holders of its Preferred Shares, shall not be taxable to such shareholders.
(m) In the event that at any time after the date of this Agreement and
prior to the Distribution Date, the Company shall (i) declare or pay any
dividend on the Common Shares payable in Common Shares or (ii) effect a
subdivision, combination or consolidation of the Common Shares (by
reclassification or otherwise than by payment of dividends in Common Shares)
into a greater or lesser number of Common Shares, then in any such case (A) the
number of one one-thousandths of a Preferred Share purchasable after such event
upon proper exercise of each Right shall be determined by multiplying the number
of one one-thousandths of a Preferred Share so purchasable immediately prior to
such event by a fraction, the numerator of which is the number of Common Shares
outstanding immediately before such event and the denominator of which is the
number of Common Shares outstanding immediately after such event, and (B) each
Common Share outstanding
28.
immediately after such event shall have issued with respect to it that number of
Rights that each Common Share outstanding immediately prior to such event had
issued with respect to it. The adjustments provided for in this Section 11(n)
shall be made successively whenever such a dividend is declared or paid or such
a subdivision, combination, or consolidation is effected.
(n) The Company covenants and agrees that, after the Distribution Date and
so long as any Rights shall then be outstanding (other than Rights that have
become void pursuant to Section 7(e) hereof), it will not, except as permitted
by Sections 23, 24, and 27 hereof, take (or permit any Subsidiary of the Company
to take) any action if at the time such action is taken it is reasonably
foreseeable that such action will diminish substantially or otherwise eliminate
the benefits intended to be afforded by the Rights.
Section 12. Certificate of Adjusted Purchase Price or Number of Shares.
Whenever an adjustment is made as provided in Section 11 or 13 hereof, the
Company shall promptly (a) prepare a certificate setting forth such adjustment,
and a brief statement of the facts accounting for such adjustment, (b) file with
the Rights Agent and with each transfer agent for the Common Shares or the
Preferred Shares a copy of such certificate, and (c) mail a brief summary
thereof to each registered holder of a Right in accordance with Section 26
hereof.
Section 13. Consolidation, Merger, or Sale or Transfer of Assets or Earning
Power.
(a) In the event, directly or indirectly, at any time after a Person has
become an Acquiring Person, (x) the Company shall consolidate with, or merge
with and into, any other Person (other than a direct or indirect, wholly-owned
Subsidiary of the Company in a transaction that complies with Section 11(o)
hereof), and the Company shall not be the continuing or surviving corporation of
such consolidation or merger, (y) any Person (other than a direct or indirect,
wholly-owned Subsidiary of
29.
the Company in a transaction that complies with Section 11(o) hereof) shall
consolidate with the Company, or merge with and into the Company, and the
Company shall be the continuing or surviving corporation of such consolidation
or merger and, in connection with such merger, all or part of the Common Shares
shall be changed into or exchanged for stock or other securities of any other
Person (or the Company) or cash or any other property, or (z) the Company shall
sell or otherwise transfer (or one or more of its Subsidiaries shall sell or
otherwise transfer), in one or more transactions, assets or earning power
aggregating 50% or more of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to any other Person or Persons (other than the
Company or one or more of its direct or indirect, wholly-owned Subsidiaries in
one or more transactions each of which complies with Section 11(o) hereof) (any
event described in (x), (y), or (z) being referred to hereinafter as a "Section
13(a) Event"), then, and in each such case, proper provision shall be made so
that (i) each holder of a Right (except as otherwise provided herein) shall
thereafter have the right to receive, upon the exercise thereof at a price equal
to the then current Purchase Price multiplied by the number of one
one-thousandths of a Preferred Share for which a Right is then exercisable, in
accordance with the terms of this Agreement and in lieu of Preferred Shares,
such number of Common Shares of the Principal Party (as such term is hereinafter
defined), not subject to any liens, encumbrances, rights of first refusal, or
other adverse claims, as shall equal the result obtained by (A) multiplying the
then current Purchase Price by the number of one one- thousandths of a Preferred
Share for which a Right is then exercisable, and dividing that product by (B)
50% of the then current per share market price of the Common Shares of the
Principal Party (determined pursuant to Section 11(d) hereof) on the date of
consummation of such Section 13(a) Event; (ii) such Principal Party shall
thereafter be liable for, and shall assume, by virtue of such
30.
Section 13(a) Event, all the obligations and duties of the Company pursuant to
this Agreement; (iii) the term "Company" shall thereafter be deemed to refer to
such Principal Party, it being specifically intended that the provisions of
Section 11 hereof shall apply only to such Principal Party following the first
occurrence of a Section 13(a) Event; (iv) such Principal Party shall take such
steps (including, but not limited to, the reservation of a sufficient number of
its Common Shares in accordance with Section 9 hereof) in connection with such
consummation as may be necessary to assure that the provisions hereof shall
thereafter be applicable, as nearly as reasonably may be, in relation to the
Common Shares thereafter deliverable upon the exercise of the Rights; and (v)
the provisions of Section 11(a)(ii) hereof shall be of no effect following the
first occurrence of a Section 13(a) Event and the Rights that have not
theretofore been exercised shall thereafter become exercisable in the manner
described in this Section 13.
(b) "Principal Party" shall mean:
(i) in the case of any transaction described in clause (x) or (y) of
the first sentence of Section 13(a), the Person (including the Company as
successor thereto or as the surviving corporation) that is the issuer of
any securities or other equity interests into which Common Shares of the
Company are converted in such merger or consolidation, and if no securities
are so issued, the Person (including the Company as successor thereto or as
the surviving corporation) that is the other constituent party to such
merger or consolidation; and
(ii) in the case of any transaction described in clause (z) of the
first sentence of Section 13(a), the Person that is the party receiving the
greatest portion of the assets or earning power transferred pursuant to
such transaction or transactions; provided, however, that in any such case,
(1) if the Common Shares of such Person are not at such time and have
31.
not been continuously over the preceding 12 month period registered under
Section 12 of the Exchange Act, and such Person is a direct or indirect
Subsidiary of another Person, the Common Shares of which are and have been
so registered, "Principal Party" shall refer to such other Person; and (2)
if the Common Shares of such Person are not at such time and have not been
continuously over the preceding 12 month period registered under Section 12
of the Exchange Act, and such Person is a Subsidiary, directly or
indirectly, of more than one Person, the Common Shares of two or more of
which are and have been so registered, "Principal Party" shall refer to
whichever of such Persons is the issuer of the Common Shares having the
greatest aggregate market value.
(c) The Company covenants and agrees that it shall not consummate any
transaction described in clauses (x), (y), or (z) of the first sentence of
Section 13(a) unless the Principal Party shall have a sufficient number of
authorized Common Shares that have not been issued (or reserved for issuance) or
that are held in its treasury to permit the exercise in full of the Rights in
accordance with this Section 13 and unless prior thereto the Company and such
Principal Party shall have executed and delivered to the Rights Agent a
supplemental agreement providing for the terms set forth in paragraphs (a) and
(b) of this Section 13 and further providing that, as soon as practicable after
the consummation of any Section 13(a) Event, the Principal Party will:
(i) prepare and file a registration statement under the Act, with
respect to the Rights and the securities purchasable upon exercise of the
Rights, on an appropriate form, and will use its best efforts to cause such
registration statement to (A) become effective as soon as practicable after
such filing and (B) remain effective (with a prospectus at all times
meeting the requirements of the Act) until the expiration date; and
32.
(ii) deliver to holders of the Rights historical financial statements
for the Principal Party and each of its Affiliates that comply in all
respects with the requirements for registration on Form 10 of the Exchange
Act.
(d) The Company covenants and agrees that it shall not, at any time after
the Distribution Date, (i) consolidate with any other Person (other than a
direct or indirect, wholly-owned Subsidiary of the Company in a transaction that
complies with Section 11(o) hereof), (ii) merge with or into any other Person
(other than a direct or indirect, wholly-owned Subsidiary of the Company in a
transaction that complies with Section 11(o) hereof), or (iii) sell or otherwise
transfer (or permit one or more of its Subsidiaries to sell or otherwise
transfer), in one or more transactions, assets or earning power aggregating 50%
or more of the assets or earning power of the Company and its Subsidiaries
(taken as a whole) to any other Person or Persons (other than the Company or one
or more of its direct or indirect, wholly-owned Subsidiaries in one or more
transactions each of which complies with Section 11(o) hereof) if (x) at the
time of or immediately after such transaction there are any rights, warrants,
instruments, or securities outstanding or any agreements or arrangements that,
as a result of the consummation of such transaction, would eliminate or
substantially diminish the benefits intended to be afforded by the Rights, or
(y) prior to, simultaneously with, or immediately after such transaction, the
shareholders of the Person who constitutes, or would constitute, the Principal
Party shall have received a distribution of Rights previously owned by such
Person or any of its Affiliates and Associates.
(e) The provisions of this Section 13 shall similarly apply to successive
mergers or consolidations or sales or other transfers.
33.
Section 14. Fractional Rights and Fractional Shares. (a) The Company shall
not be required to issue fractions of Rights or to distribute Right Certificates
that evidence fractional Rights. In lieu of such fractional Rights, there shall
be paid to the registered holders of the Right Certificates with regard to which
such fractional Rights would otherwise be issuable, an amount in cash equal to
the same fraction of the current market value of a whole Right. For the purposes
of this Section 14(a), the current market value of a whole Right shall be the
closing price of the Rights for the Trading Day immediately prior to the date on
which such fractional Rights would have been otherwise issuable. The closing
price for any day shall be the last sale price, regular way, or, in case no such
sale takes place on such day, the average of the closing bid and asked prices,
regular way, in either case as reported in the principal consolidated
transaction reporting system with respect to securities listed or admitted to
trading on the New York Stock Exchange or, if the Rights are not listed or
admitted to trading on the New York Stock Exchange, as reported in the principal
consolidated transaction reporting system with respect to securities listed on
the principal national securities exchange on which the Rights are listed or
admitted to trading or, if the Rights are not listed or admitted to trading on
any national securities exchange, the last quoted price or, if not so quoted,
the average of the high bid and low asked prices in the over-the-counter market,
as reported by NASDAQ or such other system then in use or, if on any such date
the Rights are not quoted by any such organization, the average of the closing
bid and asked prices as furnished by a professional market maker making a market
in the Rights selected by the Board of Directors of the Company. If on any such
date no such market maker is making a market in the Rights, the fair value of
the Rights on such date as determined in good faith by the Board of Directors of
the Company shall be used.
34.
(b) The Company shall not be required to issue fractions of Preferred
Shares (other than fractions that are integral multiples of one one-thousandth
of a Preferred Share) upon exercise of the Rights or to distribute certificates
that evidence fractional Preferred Shares (other than fractions that are
integral multiples of one one-thousandth of a Preferred Share). Fractions of
Preferred Shares in integral multiples of one one-thousandth of a Preferred
Share may, at the election of the Company, be evidenced by depositary receipts,
pursuant to an appropriate agreement between the Company and a depositary
selected by it; provided, however, that such agreement shall provide that the
holders of such depositary receipts shall have all the rights, privileges, and
preferences to which they are entitled as beneficial owners of the Preferred
Shares represented by such depositary receipts. In lieu of fractional Preferred
Shares that are not integral multiples of one one-thousandth of a Preferred
Share, the Company shall pay to the registered holders of Right Certificates at
the time such Rights are exercised as herein provided an amount in cash equal to
the same fraction of the current market value of one Preferred Share. For the
purposes of this Section 14(b), the current market value of a Preferred Share
shall be the closing price of a Preferred Share (as determined pursuant to the
second sentence of Section 11(d)(i) hereof) for the Trading Day immediately
prior to the date of such exercise.
(c) The holder of a Right by the acceptance of the Right expressly waives
his right to receive any fractional Rights or any fractional shares upon
exercise of a Right (except as provided above).
Section 15. Rights of Action. All rights of action in respect of this
Agreement, excepting the rights of action given to the Rights Agent under
Section 18 hereof, are vested in the respective registered holders of the Right
Certificates (and, prior to the Distribution Date, the registered holders
35.
of the Common Shares); and any registered holder of any Right Certificate (or,
prior to the Distribu tion Date, of the Common Shares), without the consent of
the Rights Agent or of the holder of any other Right Certificate (or, prior to
the Distribution Date, of the Common Shares), may, in his own behalf and for his
own benefit, enforce, and may institute and maintain any suit, action, or
proceeding against the Company to enforce, or otherwise act in respect of, his
right to exercise the Rights evidenced by such Right Certificate in the manner
provided in such Right Certificate and in this Agreement. Without limiting the
foregoing or any remedies available to the holders of Rights, it is specifically
acknowledged that the holders of Rights would not have an adequate remedy at law
for any breach of this Agreement and will be entitled to specific performance of
the obligations under, and injunctive relief against actual or threatened
violations of the obligations of any Person subject to, this Agreement.
Section 16. Agreement of Right Holders. Every holder of a Right, by
accepting the same, consents and agrees with the Company and the Rights Agent
and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be transferable only in
connection with the transfer of the Common Shares;
(b) after the Distribution Date, the Right Certificates are transferable
only on the registry books of the Rights Agent, duly endorsed or accompanied by
a proper instrument of transfer;
(c) the Company and the Rights Agent may deem and treat the person in whose
name the Right Certificate (or, prior to the Distribution Date, the associated
Common Shares certificate) is registered as the absolute owner thereof and of
the Rights evidenced thereby (notwithstanding any notations of ownership or
writing on the Right Certificates or the associated Common Shares
36.
certificate made by anyone other than the Company or the Rights Agent) for all
purposes whatsoever, and neither the Company nor the Rights Agent shall be
affected by any notice to the contrary; and
(d) notwithstanding anything in this Agreement to the contrary, neither the
Company nor the Rights Agent shall have any liability to any holder of a Right
or other Person as a result of its inability to perform any of its obligations
under this Agreement by reason of any preliminary or permanent injunction or
other order, decree or ruling issued by a court of competent jurisdiction or by
a governmental, regulatory or administrative agency or commission, or any
statute, rule, regulation or executive order promulgated or enacted by any
governmental authority, prohibiting or otherwise restraining performance of such
obligation; provided, however, the Company must use its best efforts to have any
such order, decree or ruling lifted or otherwise overturned as soon as possible.
Section 17. Right Certificate Holder Not Deemed a Shareholder. No holder,
as such, of any Right Certificate shall be entitled to vote or to receive
dividends or be deemed for any purpose the holder of the Preferred Shares or any
other securities of the Company that may at any time be issuable on the exercise
of the Rights represented thereby, nor shall anything contained herein or in any
Right Certificate be construed to confer upon the holder of any Right
Certificate, as such, any of the rights of a shareholder of the Company or any
right to vote for the election of directors or upon any matter submitted to
shareholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
shareholders (except as provided in Section 25 hereof), or to receive dividends
or subscription rights, or otherwise, until the Right or Rights evidenced by
such Right Certificate shall have been exercised in accordance with the
provisions hereof.
37.
Section 18. Concerning the Rights Agent. The Company agrees to pay to the
Rights Agent reasonable compensation for all services rendered by it hereunder
and, from time to time, on demand of the Rights Agent, its reasonable expenses
and counsel fees and other disbursements incurred in the administration and
execution of this Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Rights Agent for, and to
hold it harmless against, any loss, liability, or expense, incurred without
negligence, bad faith, or willful misconduct on the part of the Rights Agent,
for anything done or omitted by the Rights Agent in connection with the
acceptance and administration of this Agreement, including the costs and
expenses of defending against any claim of liability in the premises.
The Rights Agent shall be protected and shall incur no liability for, or in
respect of any action taken, suffered, or omitted by it in connection with, its
administration of this Agreement in reliance upon any Right Certificate or
certificate for the Preferred Shares or Common Shares or for other securities of
the Company, instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent, certificate,
statement, or other paper or document believed by it to be genuine and to be
signed, executed and, where necessary, verified or acknowledged, by the proper
person or persons, or otherwise upon the advice of counsel as set forth in
Section 20 hereof.
Section 19. Merger or Consolidation or Change of Name of Rights Agent. Any
corporation into which the Rights Agent or any successor Rights Agent may be
merged or with which it may be consolidated, or any corporation resulting from
any merger or consolidation to which the Rights Agent or any successor Rights
Agent shall be a party, or any corporation succeeding to the stock transfer or
corporate trust powers of the Rights Agent or any successor
38.
Rights Agent, shall be the successor to the Rights Agent under this Agreement
without the execution or filing of any paper or any further act on the part of
any of the parties hereto; provided, that such corporation would be eligible for
appointment as a successor Rights Agent under the provisions of Section 21
hereof. In case at the time such successor Rights Agent shall succeed to the
agency created by this Agreement, any of the Right Certificates shall have been
countersigned but not delivered, any such successor Rights Agent may adopt the
countersignature of the predecessor Rights Agent and deliver such Right
Certificates so countersigned; and in case at that time any of the Right
Certificates shall not have been countersigned, any successor Rights Agent may
countersign such Right Certificates either in the name of the predecessor Rights
Agent or in the name of the successor Rights Agent; and in all such cases such
Right Certificates shall have the full force provided in the Right Certificates
and in this Agreement.
In case at any time the name of the Rights Agent shall be changed and at
such time any of the Right Certificates shall have been countersigned but not
delivered, the Rights Agent may adopt the countersignature under its prior name
and deliver Right Certificates so countersigned; and in case at that time any of
the Right Certificates shall not have been countersigned, the Rights Agent may
countersign such Right Certificates either in its prior name or in its changed
name; and in all such cases such Right Certificates shall have the full force
provided in the Right Certificates and in this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent undertakes the duties
and obligations imposed by this Agreement upon the following terms and
conditions, by all of which the Company and the holders of Right Certificates,
by their acceptance thereof, shall be bound:
39.
(a) The Rights Agent may consult with legal counsel (who may be legal
counsel for the Company), and the opinion of such counsel shall be full and
complete authorization and protection to the Rights Agent as to any action taken
or omitted by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this Agreement the
Rights Agent shall deem it necessary or desirable that any fact or matter be
proved or established by the Company prior to taking or suffering any action
hereunder, such fact or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be conclusively proved and
established by a certificate signed by any one of the Chairman of the Board, the
Chief Executive Officer, the President, any Vice President, the Treasurer, or
the Secretary of the Company and delivered to the Rights Agent; and such
certificate shall be full authorization to the Rights Agent for any action taken
or suffered in good faith by it under the provisions of this Agreement in
reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder to the Company and any other
Person only for its own negligence, bad faith, or willful misconduct.
(d) The Rights Agent shall not be liable for or by reason of any of the
statements of fact or recitals contained in this Agreement or in the Right
Certificates (except its countersignature thereof) or be required to verify the
same, but all such statements and recitals are and shall be deemed to have been
made by the Company only.
(e) The Rights Agent shall not be under any responsibility in respect of
the validity of this Agreement or the execution and delivery hereof (except the
due execution and delivery hereof by the Rights Agent) or in respect of the
validity or execution of any Right Certificate (except its
40.
countersignature thereof); nor shall it be responsible for any breach by the
Company of any covenant or condition contained in this Agreement or in any Right
Certificate; nor shall it be responsible for any change in the exercisability of
the Rights (including the Rights becoming void pursuant to Section 7(e) hereof)
or any adjustment in the terms of the Rights (including the manner, method, or
amount thereof) provided for in Section 3, 11, 13, 23, or 24, or the
ascertaining of the existence of facts that would require any such change or
adjustment (except with respect to the exercise of Rights evidenced by Right
Certificates after actual notice that such change or adjustment is required);
nor shall it by any act hereunder be deemed to make any representation or
warranty as to the authorization or reservation of any Preferred Shares to be
issued pursuant to this Agreement or any Right Certificate or as to whether any
Preferred Shares will, when issued, be validly authorized and issued, fully paid
and nonassessable.
(f) The Company agrees that it will perform, execute, acknowledge, and
deliver or cause to be performed, executed, acknowledged, and delivered all such
further and other acts, instruments, and assurances as may reasonably be
required by the Rights Agent for the carrying out or performing by the Rights
Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from any
one of the Chairman of the Board, the Chief Executive Officer, the President,
any Vice President, the Secretary, or the Treasurer of the Company, and to apply
to such officers for advice or instructions in connection with its duties, and
it shall not be liable for any action taken or suffered by it in good faith in
accordance with instructions of any such officer or for any delay in acting
while waiting for those instructions.
41.
(h) The Rights Agent and any shareholder, director, officer, or employee of
the Rights Agent may buy, sell, or deal in any of the Rights or other securities
of the Company or become pecuniarily interested in any transaction in which the
Company may be interested, or contract with or lend money to the Company or
otherwise act as fully and freely as though it were not Rights Agent under this
Agreement. Nothing herein shall preclude the Rights Agent from acting in any
other capacity for the Company or for any other legal entity.
(i) The Rights Agent may execute and exercise any of the rights or powers
hereby vested in it or perform any duty hereunder either itself or by or through
its attorneys or agents, and the Rights Agent shall not be answerable or
accountable for any act, default, neglect, or misconduct of any such attorneys
or agents or for any loss to the Company resulting from any such act, default,
neglect, or misconduct, provided reasonable care was exercised in the-selection
and continued employment thereof.
Section 21. Change of Rights Agent. The Rights Agent or any successor
Rights Agent may resign and be discharged from its duties under this Agreement
upon 30 days' notice in writing mailed to the Company and to each transfer agent
of the Common Shares or Preferred Shares by registered or certified mail, and to
the registered holders of the Right Certificates by first-class mail. The
Company may remove the Rights Agent or any successor Rights Agent upon 30 days'
notice in writing, mailed to the Rights Agent or successor Rights Agent, as the
case may be, and to each transfer agent of the Common Shares or Preferred Shares
by registered or certified mail, and to the registered holders of the Right
Certificates by first-class mail, postage prepaid. If the Rights Agent shall
resign or be removed or shall otherwise become incapable of acting, the Company
shall appoint a successor to the Rights Agent. If the Company shall fail to make
such appointment within a period
42.
of 30 days after giving notice of such removal or after it has been notified in
writing of such resignation or incapacity by the resigning or incapacitated
Rights Agent or by the holder of a Right Certificate (who shall, with such
notice, submit his Right Certificate for inspection by the Company), then the
registered holder of any Right Certificate may apply to any court of competent
jurisdiction for the appointment of a new Rights Agent. Any successor Rights
Agent, whether appointed by the Company or by such a court, shall be a
corporation organized and doing business under the laws of the United States or
of the State of New York (or of any other state of the United States so long as
such corporation is authorized to do business in the State of New York, in good
standing, having an office in the State of New York, which is authorized under
such laws to exercise corporate trust or stock transfer powers and is subject to
supervision or examination by federal or state authority and which has at the
time of its appointment as Rights Agent a combined capital and surplus of at
least $25 million). After appointment, the successor Rights Agent shall be
vested with the same powers, rights, duties, and responsibilities as if it had
been originally named as Rights Agent without further act or deed; but the
predecessor Rights Agent shall deliver and transfer to the successor Rights
Agent any property at the time held by it hereunder, and execute and deliver any
further assurance, conveyance, act, or deed necessary for the purpose. Not later
than the effective date of any such ap pointment, the Company shall file notice
thereof in writing with the predecessor Rights Agent and each transfer agent of
the Common Shares or Preferred Shares, and send, in accordance with Section 26
hereof, a notice thereof, in writing, to the registered holders of Right
Certificates. Failure to give any notice provided for in this Section 21,
however, or any defect therein, shall not affect the legality or validity of the
resignation or removal of the Rights Agent or the appointment of the successor
Rights Agent, as the case may be.
43.
Section 22. Issuance of New Right Certificates. Notwithstanding any of the
provisions of this Agreement or of the Rights to the contrary, the Company may,
at its option, issue new Right Certificates evidencing Rights in such form as
may be approved by its Board of Directors to reflect any adjustment or change in
the Purchase Price and the number or kind or class of shares or other securities
or property purchasable under the Right Certificates made in accordance with the
provisions of this Agreement.
Section 23. Redemption. (a) The Board of Directors of the Company may, at
its option, at any time prior to the Close of Business on the tenth calendar day
following the Shares Acquisition Date (or, if the Shares Acquisition Date
occurred prior to the Record Date, the Close of Business on the tenth calendar
day following the Record Date), redeem all but not less than all the then
outstanding Rights at a redemption price of $0.001 per Right, appropriately
adjusted to reflect any stock split, stock dividend, or similar transaction
occurring after the date hereof (such redemption price, as adjusted, being
hereinafter referred to as the "Redemption Price"); provided, however, that if
such authorization occurs on or after the date of a change (resulting from a
proxy solicitation) in a majority of the directors in office at the commencement
of such solicitation, and any Person who is or was a participant in such
solicitation has stated (or if upon the commencement of such solicitation, a
majority of the Board of Directors of the Company has determined in good faith)
that such Person (or any of its Affiliates or Associates) has taken or intends
to take, or may consider taking, any action that would result in such Person
becoming an Acquiring Person or that would cause the occurrence of a Triggering
Event (the existence of the circumstances described in this provision being
referred to herein as an "Adverse Change of Control"), then the Rights may be so
redeemed only if there are Continuing Directors in office
44.
and such redemption is authorized by a majority of such Continuing Directors.
Notwithstanding the foregoing, the aggregate Redemption Price payable to any
holder of Rights upon the redemption of all Rights held by such holder shall be
rounded to the nearest one cent ($0.01) (such that fractions of one cent ($0.01)
greater than or equal to one-half of one cent ($0.005) shall be rounded up to
the next highest cent and fractions of one cent ($0.01) less than one-half of
one cent ($0.005) shall be rounded down to the next lowest cent); and further
provided that the aggregate Redemption Price payable to any holder of Rights
upon the redemption of all Rights held by such Person shall in no event be less
than $0.01. The redemption of the Rights by the Board of Directors may be made
effective at such time, on such basis, and with such conditions as the Board of
Directors in its sole discretion may establish.
(b) Immediately upon the action of the Board of Directors of the Company
effectively ordering the redemption of the Rights pursuant to paragraph (a) of
this Section 23, and without any further action and without any notice, the
right to exercise the Rights will terminate and the only right thereafter of the
holders of Rights shall be to receive the Redemption Price. The Company shall
promptly give public notice of any such redemption; provided, however, that the
failure to give, or any defect in, any such notice shall not affect the validity
of such redemption. Within 10 days after such action of the Board of Directors
ordering the redemption of the Rights, the Company shall mail a notice of
redemption to all the holders of the then outstanding Rights at their last
addresses as they appear upon the registry books of the Rights Agent or, prior
to the Distribution Date, on the registry books of the transfer agent for the
Common Shares. Any notice that is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice. Each such
45.
notice of redemption will state the method by which the payment of the
Redemption Price will be made. Neither the Company nor any of its Affiliates or
Associates may redeem, acquire, or purchase for value any Rights at any time in
any manner other than that specifically set forth in this Section 23 or in
Section 24 hereof, and other than in connection with the purchase of Common
Shares prior to the Distribution Date.
Section 24. Exchange.
(a) The Board of Directors of the Company may, at its option, at any time
after any Person becomes an Acquiring Person, exchange all or part of the then
outstanding and exercisable Rights (which shall not include Rights that have
become void pursuant to the provisions of Section 7(e) hereof) for Common Shares
at an exchange ratio of one Common Share per Right, appropriately adjusted to
reflect any stock split, stock dividend, or similar transaction occurring after
the date hereof (such exchange ratio being hereinafter referred to as the
"Exchange Ratio"). Notwithstanding the foregoing, the Board of Directors shall
not be empowered to effect such exchange at any time after any Person (other
than any Subsidiary of the Company, any employee benefit plan of the Company or
any such Subsidiary, or any entity holding Common Shares for or pursuant to the
terms of any such plan), together with all Affiliates and Associates of such
Person, becomes the Beneficial Owner of 50% or more of the Common Shares then
outstanding.
(b) Immediately upon the action of the Board of Directors of the Company
ordering the exchange of any Rights pursuant to paragraph (a) of this Section 24
and without any further action and without any notice, the right to exercise
such Rights shall terminate and the only right thereafter of a holder of such
Rights shall be to receive that number of Common Shares equal to the number of
such Rights held by such holder multiplied by the Exchange Ratio. The Company
shall promptly
46.
give public notice of any such exchange; provided, however, that the failure to
give, or any defect in, such notice shall not affect the validity of such
exchange. The Company promptly shall mail a notice of any such exchange to all
of the holders of such Rights at their last addresses as they appear upon the
registry books of the Rights Agent. Any notice that is mailed in the manner
herein provided shall be deemed given, whether or not the holder receives the
notice. Each such notice of exchange will state the method by which the exchange
of the Common Shares for Rights will be effected and, in the event of any
partial exchange, the number of Rights that will be exchanged. Any partial
exchange shall be effected pro rata based on the number of Rights (other than
Rights that have become void pursuant to the provisions of Section 7(e) hereof)
held by each holder of Rights.
(c) In the event that there shall not be sufficient Common Shares issued but not
outstanding or authorized but unissued to permit any exchange of Rights as
contemplated in accordance with this Section 24, the Company shall take all such
action as may be necessary to authorize additional Common Shares for issuance
upon exchange of the Rights. In the event the Company shall, after good faith
effort, be unable to take all such action as may be necessary to authorize such
additional Common Shares, the Company shall substitute, for each Common Share
that would otherwise be issuable upon exchange of a Right, a number of Preferred
Shares or fraction thereof such that the current per share market price of one
Preferred Share multiplied by such number or fraction is equal to the current
per share market price of one Common Share as of the date of issuance of such
Preferred Shares or fraction thereof.
(d) The Company shall not be required to issue fractions of Common Shares or to
distribute certificates that evidence fractional Common Shares. In lieu of such
fractional Common Shares, the Company shall pay to the registered holders of the
Right Certificates with regard to
47.
which such fractional Common Shares would otherwise be issuable an amount in
cash equal to the same fraction of the current market value of a whole Common
Share. For the purposes of this paragraph (d), the current market value of a
whole Common Share shall be the closing price of a Common Share (as determined
pursuant to the second sentence of Section 11(d)(i) hereof) for the Trading Day
immediately prior to the date of exchange pursuant to this Section 24.
Section 25. Notice of Certain Events.
(a) In case the Company shall propose (i) to pay any dividend payable in
stock of any class to the holders of its Preferred Shares or to make any other
distribution to the holders of its Preferred Shares (other than a regular
quarterly cash dividend), (ii) to offer to the holders of its Preferred Shares
rights or warrants to subscribe for or to purchase any additional Preferred
Shares or shares of stock of any class or any other securities, rights, or
options, (iii) to effect any reclassification of its Preferred Shares (other
than a reclassification involving only the subdivision of outstanding Preferred
Shares), (iv) to effect any consolidation or merger into or with, or to effect
any sale or other transfer (or to permit one or more of its Subsidiaries to
effect any sale or other transfer), in one or more transactions, of 50% or more
of the assets or earning power of the Company and its Subsidiaries (taken as a
whole) to, any other Person, (v) to effect the liquidation, dissolution, or
winding up of the Company, or (vi) to declare or pay any dividend on the Common
Shares payable in Common Shares or to effect a subdivision, combination, or
consolidation of the Common Shares (by reclassification or otherwise than by
payment of dividends in Common Shares), then, in each such case, the Company
shall give to each registered holder of a Right Certificate, in accordance with
Section 26 hereof, a notice of such proposed action, which shall specify the
record date for the purposes of such stock dividend, or distribution of rights
or warrants, or the date on
48.
which such reclassification, consolidation, merger, sale, transfer, liquidation,
dissolution, or winding up is to take place and the date of participation
therein by the holders of the Common Shares and/or Preferred Shares, if any such
date is to be fixed, and such notice shall be so given in the case of any action
covered by clause (i) or (ii) above at least 10 days prior to the record date
for determining holders of the Preferred Shares for purposes of such action, and
in the case of any such other action, at least 10 days prior to the date of the
taking of such proposed action or the date of participation therein by the
holders of the Common Shares and/or Preferred Shares, whichever shall be the
earlier.
(b) In case the event set forth in Section 11(a)(ii) hereof shall occur,
then (i) the Company shall as soon as practicable thereafter give to each
registered holder of a Right Certificate, in accordance with Section 26 hereof,
a notice of the occurrence of such event, which notice shall describe such event
and the consequences of such event to holders of Rights under Section 11(a)(ii)
hereof, and (ii) all references in the preceding Section 25(a) to Preferred
Shares shall be deemed to refer to Common Shares and/or, if appropriate, other
securities.
(c) In case any transaction described in clauses (x), (y), or (z) of the
first sentence of Section 13(a) hereof shall occur, then the Company shall as
soon as practicable thereafter give to each registered holder of a Right
Certificate, in accordance with Section 26 hereof, a notice of the occurrence of
such transaction, which notice shall describe such transaction and the
consequences of such transaction to holders of Rights under Section 13(a)
hereof.
Section 26. Notices. Notices or demands authorized by this Agreement to be
given or made by the Rights Agent or by the holder of any Right Certificate to
or on the Company shall be sufficiently given or made if sent by first-class
mail, postage prepaid, addressed (until another address is filed in writing with
the Rights Agent) as follows:
49.
Mylan Laboratories Inc.
Attention: Corporate Secretary
1030 Century Building, 10th Floor
Pittsburgh, PA 15222
Subject to the provisions of Section 21 hereof, any notice or demand
authorized by this Agreement to be given or made by the Company or by the holder
of any Right Certificate to or on the Rights Agent shall be sufficiently given
or made if sent by first-class mail, postage prepaid, addressed (until another
address is filed in writing with the Company) as follows:
American Stock Transfer & Trust Company
40 Wall Street
New York, New York 10005
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Right Certificate shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed to such holder at the address of such holder as shown on the registry
books of the Company.
Section 27. Supplements and Amendments. The Company may from time to time
supplement or amend this Agreement without the approval of any holders of Right
Certificates in order to cure any ambiguity, to correct or supplement any
provision contained herein that may be defective or inconsistent with any other
provisions herein, or to make any other provisions with respect to the Rights
that the Company may deem necessary or desirable, any such supplement or
amendment to be evidenced by a writing signed by the Company and the Rights
Agent; provided, however, that from and after the Close of Business on the tenth
calendar day following the Shares Acquisition Date (or, if the Shares
Acquisition Date occurred prior to the Record Date, the Close
50.
of Business on the tenth calendar day following such Record Date), this
Agreement shall not be amended in any manner that would adversely affect the
interests of the holders of Rights (other than Rights that have become void
pursuant to Section 7(e) hereof); and further provided, that from and after an
Adverse Change of Control, the Rights Plan shall not be amended in any manner
that would adversely affect the interests of the holders of Rights (other than
Rights that have become void pursuant to Section 7(e) hereof) unless there are
Continuing Directors in office and such amendment is authorized by a majority of
such Continuing Directors. Without limiting the foregoing, the Company may at
any time prior to the Close of Business on the tenth calendar day following the
Shares Acquisition Date (or, if the Shares Acquisition Date occurred prior to
the Record Date, the Close of Business on the tenth calendar day following such
Record Date), subject to the conditions set forth in the immediately preceding
sentence, amend this Agreement to lower the thresholds set forth in Sections
1(a) and 3(a) to not less than the greater of (i) the sum of .001% and the
largest percentage of the outstanding Common Shares then known by the Company to
be Beneficially Owned by any Person (other than the Company, any Subsidiary of
the Company, any employee benefit plan of the Company or any Subsidiary of the
Company, or any entity holding Common Shares for or pursuant to the terms of any
such plan) and (ii) 15%.
Section 28. Successors. All the covenants and provisions of this Agreement
by or for the benefit of the Company or the Rights Agent shall bind and inure to
the benefit of their respective successors and assigns hereunder.
Section 29. Benefits of this Agreement. Nothing in this Agreement shall be
construed to give to any person or corporation other than the Company, the
Rights Agent, and the registered
51.
holders of the Right Certificates (and, prior to the Distribution Date, the
Common Shares) any legal or equitable right, remedy, or claim under this
Agreement; but this Agreement shall be for the sole and exclusive benefit of the
Company, the Rights Agent, and the registered holders of the Right Certificates
(and, prior to the Distribution Date, the Common Shares).
Section 30. Determinations and Actions by the Board of Directors. The Board
of Directors of the Company shall have the exclusive power and authority to
interpret and administer this Agreement and to exercise all rights and powers
specifically granted to the Board of Directors of the Company or to the Company
and any and all additional rights and powers as may be necessary or advisable in
the administration of this Agreement, including, without limitation, the right
and power (i) to interpret the provisions of this Agreement, and (ii) to make
all determinations deemed necessary or advisable for the administration of this
Agreement (including a determination to redeem or not to redeem the Rights, to
exchange or not to exchange the Rights, or to supplement or amend the
Agreement); provided, however, that if such authority is exercised on or after
an Adverse Change of Control, then the authority may be exercised only if there
are Continuing Directors in office and such exercise of authority is authorized
by a majority of such Continuing Directors. All such actions, exercises,
calculations, interpretations, and determinations (including for purposes of
clause (y) of this Section 30, all omissions with respect to the foregoing) that
are done or made by the Board of Directors of the Company in good faith and in
compliance with conditions set forth herein, shall (x) be final, conclusive, and
binding on the Company, the Rights Agent, the holders of the Rights, and all
other Persons, and (y) not subject any director or officer of the Company to any
personal liability to any holder of the Rights or any other Person.
52.
Section 31. Severability. If any term, provision, covenant, or restriction
of this Agreement is held by a court of competent jurisdiction or other
authority to be invalid, void, or unenforceable, the remainder of the terms,
provisions, covenants, and restrictions of this Agreement shall remain in full
force and effect and shall in no way be affected, impaired, or invalidated.
Section 32. Governing Law. This Agreement and each Right Certificate issued
hereunder shall be deemed to be a contract made under the laws of the
Commonwealth of Pennsylvania and for all purposes shall be governed by and
construed in accordance with the laws of such Commonwealth applicable to
contracts to be made and performed entirely within such Commonwealth.
Section 33. Counterparts. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and
the same instrument.
Section 34. Descriptive Headings. Descriptive headings of the several
Sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
53.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and attested, all as of the day and year first above written.
MYLAN LABORATORIES INC.
Attest:
By_____________________________ By /s/ Milan Puskar
Title: Title: Chairman, CEO and President
AMERICAN STOCK TRANSFER
Attest: & TRUST COMPANY
By_____________________________ By_____________________________
Title: Title:
54.
Exhibit A
RESOLUTION OF BOARD OF DIRECTORS
TO AMEND ARTICLES OF INCORPORATION
TO ESTABLISH A SERIES OF PREFERRED SHARES*
RESOLVED, that pursuant to the authority granted to and vested in the Board
of Directors of the Company in accordance with the provisions of the Amended and
Restated Articles of Incorporation of the Company and Section 1522 of the
Pennsylvania Business Corporation Law, as amended, the Board of Directors hereby
adopts and approves an amendment to the Amended and Restated Articles of
Incorporation of the Company, as amended, which creates out of the authorized
but unissued shares of Preferred Stock, par value $0.50 per share, of the
Company a series of Preferred Stock, the designation and authorized number of
shares of which, and the terms and relative rights, preferences and limitations
of which, are as follows:
Section 1. Designation and Amount. The shares of such series shall be
designated as "Series A Junior Participating Preferred Stock" (the "Series
A Preferred Stock") and the number of shares constituting the Series A
Preferred Stock shall be 300,000. Such number of shares may be increased or
decreased by resolution of the Board of Directors; provided, (a) that no
decrease shall reduce the number of shares of Series A Preferred Stock to a
number less than the number of shares then outstanding plus the number of
shares reserved for issuance upon the exercise of outstanding options,
rights, or warrants or upon the conversion of any outstanding securities
issued by the corporation convertible into Series A Preferred Stock; and
(b) no increase shall cause the aggregate number of all shares of Preferred
Stock that the corporation is authorized to issue to be greater than is
authorized by these Amended and Restated Articles of Incorporation.
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of any other series
of Preferred Stock of the corporation (or any similar stock) ranking prior
and superior to the Series A Preferred Stock with respect to dividends, the
holders of shares of Series A Preferred Stock, in preference to the holders
of Common Stock, par value $0.50 per share (the "Common Stock"), of the
corporation, and of any other junior stock, shall be entitled to receive,
when, as and if declared by the Board of Directors out of funds legally
available for the purpose, quarterly dividends payable in cash on the first
day of March, June, September, and December in each year (each such date
being referred to herein as a "Quarterly Dividend Payment Date"),
commencing on the first Quarterly Dividend Payment
- ----------------------
*To be attached to a Statement with Respect to Shares or
to an Amendment to Articles of Incorporation filed with the Secretary of State
of Pennsylvania. 1.
Date after the first issuance of a share or fraction of a share of Series A
Preferred Stock, in an amount per share (rounded to the nearest cent) equal
to the greater of (a) $1 or (b) subject to the provision for adjustment
hereinafter set forth, 1000 times the aggregate per share amount of all
cash dividends, and 1000 times the aggregate per share amount (payable in
kind) of all non-cash dividends or other distributions, other than a
dividend payable in shares of Common Stock or a subdivision of the
outstanding shares of Common Stock (by reclassification or otherwise),
declared on the Common Stock since the immediately preceding Quarterly
Dividend Payment Date or, with respect to the first Quarterly Dividend
Payment Date, since the first issuance of any share or fraction of a share
of Series A Preferred Stock. In the event the corporation shall at any time
declare or pay any dividend on the Common Stock payable in shares of Common
Stock, or effect a subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification or otherwise than
by payment of a dividend in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in each such case the amount
to which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event under clause (b) of the preceding sentence
shall be adjusted by multiplying such amount by a fraction, the numerator
of which is the number of shares of Common Stock outstanding immediately
after such event and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to such event.
(B) The corporation shall declare a dividend or distribution on the
Series A Preferred Stock as provided in paragraph (A) of this Section
immediately after it declares a dividend or distribution on the Common
Stock (other than a dividend payable in shares of Common Stock); provided
that, in the event no dividend or distribution shall have been declared on
the Common Stock during the period between any Quarterly Dividend Payment
Date and the next subsequent Quarterly Dividend Payment Date, a dividend of
$1 per share on the Series A Preferred Stock shall nevertheless be payable
on such subsequent Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative on outstanding
shares of Series A Preferred Stock from the Quarterly Dividend Payment Date
next preceding the date of issue of such shares, unless the date of issue
of such shares is prior to the record date for the first Quarterly Dividend
Payment Date, in which case dividends on such shares shall begin to accrue
from the date of issue of such shares, or unless the date of issue is a
Quarterly Dividend Payment Date or is a date after the record date for the
determination of holders of shares of Series A Preferred Stock entitled to
receive a quarterly dividend and before such Quarterly Dividend Payment
Date, in either of which events such dividends shall begin to accrue and be
cumulative from such Quarterly Dividend Payment Date. Accrued but unpaid
dividends shall not bear interest. Dividends paid on the shares of Series
2.
A Preferred Stock in an amount less than the total amount of such dividends
at the time accrued and payable on such shares shall be allocated pro rata
on a share-by- share basis among all such shares at the time outstanding.
The Board of Directors may fix a record date for the determination of
holders of shares of Series A Preferred Stock entitled to receive payment
of a dividend or distribution declared thereon, which record date shall be
not more than 60 days prior to the date fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of Series A Preferred Stock
shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set forth,
each share of Series A Preferred Stock shall entitle the holder thereof to
1000 votes on all matters submitted to a vote of the shareholders of the
corporation. In the event the corporation shall at any time declare or pay
any dividend on the Common Stock payable in shares of Common Stock, or
effect a subdivision or combination or consolidation of the outstanding
shares of Common Stock (by reclassification or otherwise than by payment of
a dividend in shares of Common Stock) into a greater or lesser number of
shares of Common Stock, then in each such case the number of votes per
share to which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event shall be adjusted by multiplying such
number by a fraction, the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the denominator
of which is the number of shares of Common Stock that were outstanding
immediately prior to such event.
(B) Except as otherwise provided herein or in any other Statement with
Respect to Shares or other amendment of the Articles of Incorporation
creating a series of Preferred Stock or any similar stock, or by law, the
holders of shares of Series A Preferred Stock and the holders of shares of
Common Stock and any other capital stock of the corporation having general
voting rights shall vote together as one class on all matters submitted to
a vote of shareholders of the corporation.
(C) Except as set forth herein, or as otherwise provided by law,
holders of Series A Preferred Stock shall have no special voting rights and
their consent shall not be required (except to the extent they are entitled
to vote with holders of Common Stock as set forth herein) for taking any
corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or distributions
payable on the Series A Preferred Stock as provided in Section 2 are in
arrears, thereafter and until all accrued and unpaid dividends and
distributions, whether or
3.
not declared, on shares of Series A Preferred Stock outstanding shall have
been paid in full, the corporation shall not:
(i) declare or pay dividends, or make any other distributions, on any
shares of stock ranking junior (either as to dividends or upon liquidation,
dissolution, or winding up) to the Series A Preferred Stock;
(ii) declare or pay dividends, or make any other distributions, on any
shares of stock ranking on a parity (either as to dividends or upon
liquidation, dissolution, or winding up) with the Series A Preferred Stock,
except dividends paid ratably on the Series A Preferred Stock and all such
parity stock on which dividends are payable or in arrears in proportion to
the total amounts to which the holders of all such shares are then
entitled;
(iii) redeem or purchase or otherwise acquire for consideration shares
of any stock ranking junior (either as to dividends or upon liquidation,
dis solution, or winding up) to the Series A Preferred Stock, provided that
the corporation may at any time redeem, purchase, or otherwise acquire
shares of any such junior stock in exchange for shares of any stock of the
corporation ranking junior (either as to dividends or upon dissolution,
liquidation, or winding up) to the Series A Preferred Stock; or
(iv) redeem or purchase or otherwise acquire for consideration any
shares of Series A Preferred Stock, or any shares of stock ranking on a
parity with the Series A Preferred Stock, except in accordance with a
purchase offer made in writing or by publication (as determined by the
Board of Directors) to all holders of such shares upon such terms as the
Board of Directors, after consideration of the respective annual dividend
rates and other relative rights and preferences of the respective series
and classes, shall determine in good faith will result in fair and
equitable treatment among the respective series or classes.
(B) The corporation shall not permit any subsidiary of the corporation
to purchase or otherwise acquire for consideration any shares of stock of
the corporation unless the corporation could, under paragraph (A) of this
Section 4, purchase or otherwise acquire such shares at such time and in
such manner.
Section 5. Reacquired Shares. Any shares of Series A Preferred Stock
purchased or otherwise acquired by the corporation in any manner whatsoever
shall be retired and canceled promptly after the acquisition thereof. All
such shares shall upon their cancellation become authorized but unissued
shares of Preferred Stock and may be reissued as part of a new series of
Preferred Stock subject to the conditions and restrictions on issuance set
forth herein, in the Articles of Incorporation, or in
4.
any other Articles of Amendment creating a series of Preferred Stock, par
value $0.50 per share, or any similar stock or as otherwise required by
law.
Section 6. Liquidation, Dissolution, or Winding Up. Upon any liquidation,
dissolution, or winding up of the corporation, no distribution shall be
made (1) to the holder of shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution, or winding up) to the Series A
Preferred Stock unless the holders of shares of Series A Preferred Stock
outstanding shall have received out of the assets of the Company available
for distribution to its shareholders after payment or provision for payment
of any securities ranking senior to the Series A Preferred Stock, for each
share of Series A Preferred Stock, subject to adjustment as hereinafter
provided, (A) $1000.00 plus an amount equal to accrued and unpaid dividends
and distributions thereon, whether or not declared, to the date of such
payment or, (B) if greater than the amount specified in clause (1)(A) of
this sentence, an amount equal to 1000 times the aggregate amount to be
distributed per share to holders of Common Stock, as the same may be
adjusted as herein provided, or (2) to the holders of shares of stock
ranking on a parity (either as to dividends or upon liquidation,
dissolution, or winding up) with the Series A Preferred Stock, unless
simultaneously therewith distributions are made ratably on the Series A
Preferred Stock and all such parity stock in proportion to the total
amounts to which the holders of all such shares are entitled upon such
liquidation, dissolution, or winding up. In the event the corporation shall
at any time declare or pay any dividend on the Common Stock payable in
shares of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in shares of
Common Stock) into a greater or lesser number of shares of Common Stock,
then in each such case the aggregate amount to which holders of shares of
Series A Preferred Stock were entitled immediately prior to such event
under the provision in clause (1) of the preceding sentence shall be
adjusted by multiplying such amount by a fraction the numerator of which is
the number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common Stock
that were outstanding immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the corporation shall enter
into any consolidation, merger, combination, or other transaction in which
the shares of Common Stock are exchanged for or changed into other stock or
securities, cash, and/or any other property, then in any such case each
share of Series A Preferred Stock shall at the same time be similarly
exchanged or changed into an amount per share, subject to the provision for
adjustment hereinafter set forth, equal to 1000 times the aggregate amount
of stock, securities, cash, and/or any other property (payable in kind), as
the case may be, into which or for which each share of Common Stock is
changed or exchanged. In the event the corporation shall at any
5.
time declare or pay any dividend on the Common Stock payable in shares of
Common Stock, or effect a subdivision or combination or consolidation of
the outstanding shares of Common Stock (by reclassification or otherwise
than by payment of a dividend in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in each such case the amount
set forth in the preceding sentence with respect to the exchange or change
of shares of Series A Preferred Stock shall be adjusted by multiplying such
amount by a fraction, the numerator of which is the number of shares of
Common Stock outstanding im mediately after such event and the denominator
of which is the number of shares of Common Stock that were outstanding
immediately prior to such event.
Section 8. No Redemption. The shares of Series A Preferred Stock shall not
be redeemable.
Section 9. Rank. The Series A Preferred Stock shall rank, with respect to
the payment of dividends and the distribution of assets, junior to all
other series of the corporation's Preferred Stock.
Section 10. Amendment. The Articles of Incorporation of the corporation
shall not be amended in any manner that would materially alter or change
the powers, preferences, or special rights of the Series A Preferred Stock
so as to affect them adversely without the affirmative vote of the holders
of at least two-thirds of the outstanding shares of Series A Preferred
Stock, voting together as a single class.
6.
Exhibit B
Form of Right Certificate
Certificate No. R-_______ _______ Rights
NOT EXERCISABLE AFTER SEPTEMBER 5, 2006 OR EARLIER IF REDEMPTION OR
EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $.001 PER
RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT
REFERRED TO BELOW. UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE
RIGHTS AGREEMENT, RIGHTS OWNED BY OR TRANSFERRED TO ANY PERSON WHO
BECOMES AN ACQUIRING PERSON (AS DEFINED IN THE RIGHTS AGREEMENT) AND
CERTAIN TRANSFEREES THEREOF WILL BECOME NULL AND VOID AND WILL NO
LONGER BE TRANSFERABLE.
Right Certificate
MYLAN LABORATORIES INC.
This certifies that ___________, or registered assigns, is the registered
owner of the number of Rights set forth above, each of which entitles the owner
thereof, subject to the terms, provisions and conditions of the Rights
Agreement, dated as of August 22, 1996, as the same may be amended from time to
time (the "Rights Agreement"), between Mylan Laboratories Inc., a Pennsylvania
corporation (the "Company"), and American Stock Transfer & Trust Company (the
"Rights Agent"), to purchase from the Company at any time after the Distribution
Date (as such term is defined in the Rights Agreement) and prior to 5:00 P.M.,
Eastern Standard time, on September 5, 2006 at the principal office of the
Rights Agent designated for such purpose, or of its successor as Rights Agent,
one one-thousandth of a fully paid, non-assessable share of Series A Junior
Participating Preferred Stock, par value $.50 per share (the "Preferred Stock"),
of the Company, at a purchase price of $90 per one one-thousandth of a share of
Preferred Stock (the "Purchase Price"), upon presentation and surrender of this
Right Certificate with the Form of Election to Purchase duly executed. The
number of Rights evidenced by this Rights Certificate (and the number of one
one-thousandths of a share of Preferred Stock which may be purchased upon
exercise hereof) set forth above, and the Purchase Price set forth above, are
the number and Purchase Price as of ________, 1996, based on the Preferred Stock
as constituted at such date. As provided in the Rights Agreement, the Purchase
Price, the number of one one-thousandths of a share of Preferred Stock which may
be purchased upon the exercise of the Rights and the number of Rights evidenced
by this Right Certificate are subject to modification and adjustment upon the
happening of certain events.
This Right Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference
1.
and made a part hereof and to which Rights Agreement reference is hereby
made for a full description of the rights, limitations of rights,
obligations, duties and immunities hereunder of the Rights Agent, the
Company and the holders of the Right Certificates. Copies of the Rights
Agreement are on file at the principal executive offices of the Company and
the above-mentioned offices of the Rights Agent.
This Right Certificate, with or without other Right Certificates, upon
surrender at the principal office of the Rights Agent, may be exchanged for
another Right Certificate or Right Certificates of like tenor and date
evidencing Rights entitling the holder to purchase a like aggregate number of
shares of Preferred Stock as the Rights evidenced by the Right Certificate or
Right Certificates surrendered shall have entitled such holder to purchase. If
this Right Certificate shall be exercised in part, the holder shall be entitled
to receive upon surrender hereof another Right Certificate or Right Certificates
for the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced by
this Certificate (i) may be redeemed by the Company at a redemption price of
$0.001 per Right or (ii) may be exchanged in whole or in part for shares of
Preferred Stock or shares of the Company's Common Stock, par value $0.50 per
share.
The Company shall not be required to issue fractional shares of Preferred
Stock upon the exercise of any Right or Rights evidenced hereby (other than
fractions which are integral multiples of one one-thousandth of a share of
Preferred Stock, which may, at the election of the Company, be evidenced by
depositary receipts), but in lieu thereof a cash payment will be made, as
provided in the Rights Agreement.
No holder of this Right Certificate, as such, shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of the Preferred Stock
or of any other securities of the Company which may at any time be issuable on
the exercise hereof, nor shall anything contained in the Rights Agreement or
herein be construed to confer upon the holder hereof, as such, any of the rights
of a shareholder of the Company or any right to vote for the election of
directors or upon any matter submitted to shareholders at any meeting thereof,
or to give or withhold consent to any corporate action, or to receive notice of
meetings or other actions affecting shareholders (except as provided in the
Rights Agreement) or to receive dividends or subscription rights, or otherwise,
until the Right or Rights evidenced by this Right Certificate shall have been
exercised as provided in the Rights Agreement.
This Right Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Rights Agent.
2.
WITNESS the facsimile signature of the proper officers of the Company and
its corporate seal.
Dated as of ____________.
ATTEST: MYLAN LABORATORIES, INC.
By: _________________ By: ____________________________
Name: Name:
Title: Title:
Countersigned:
American Stock Transfer & Trust Company,
as Rights Agent
By: ___________________________
Authorized Signature
3.
Form of Reverse Side of Right Certificate
FORM OF ASSIGNMENT
To be executed by the registered holder if such holder desires to transfer the
Right Certificate)
FOR VALUE RECEIVED _________________________ hereby sells, assigns and transfers
unto
-----------------------------------------------------------------------------
(Please print name and address of transferee)
Rights represented by this Right Certificate, together with all right, title and
interest therein, and does hereby irrevocably constitute and appoint
___________________ Attorney, to transfer said Rights on the books of the
within-named Company, with full power of substitution.
Dated: _________________ ______________________________
Signature
Signature Guaranteed:
Signatures must be guaranteed by an eligible guarantor institution (a
bank, stockbroker, savings and loan association or credit union with membership
in an approved signature guarantee medallion program) pursuant to Rule 17Ad-15
of the Securities Exchange Act of 1934.
- ------------------------------------------------------------------------------
(To be completed)
The undersigned hereby certifies that the Rights evidenced by this Right
Certificate are not beneficially owned by, were not acquired by the undersigned
from, and are not being assigned to, an Acquiring Person or an Affiliate or
Associate thereof (as defined in the Rights Agreement).
------------------------------
Signature
4.
Form of Reverse Side of Right Certificate - continued
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise Rights represented by the
Right Certificate)
To Mylan Laboratories Inc.:
The undersigned hereby irrevocably elects to exercise __________________
Rights represented by this Right Certificate to purchase the shares of Preferred
Stock issuable upon the exercise of such Rights and requests that certificates
for such shares of Preferred Stock (or such other securities) be issued in the
name of:
Please insert social security
or other identifying number
- ------------------------------------------------------------------------------
(Please print name and address)
- ------------------------------------------------------------------------------
If such number of Rights shall not be all the Rights evidenced by this
Right Certificate, a new Right Certificate for the balance remaining of such
Rights shall be registered in the name of and delivered to:
Please insert social security
or other identifying number
- --------------------------------------------------------------------------------
(Please print name and address)
- ------------------------------------------------------------------------------
Dated: ____________________ ____________________________________
Signature
(Signature must conform to holder specified on Right Certificate)
Signature Guaranteed:
Signatures must be guaranteed by an eligible guarantor institution (a bank,
stockbroker, savings and loan association or credit union with membership in an
approved signature guarantee medallion program) pursuant to Rule 17Ad-15 of the
Securities Exchange Act of 1934.
5.
Form of Reverse Side of Right Certificate -- continued
- --------------------------------------------------------------------
(To be completed)
The undersigned certifies that the Rights evidenced by this Right
Certificate are not beneficially owned by, and were not acquired by the
undersigned from, an Acquiring Person or an Affiliate or Associate thereof (as
defined in the Rights Agreement).
Dated:_______________________ ___________________________________
Signature
NOTICE
The signature in the Form of Assignment or Form of Election to Purchase, as
the case may be, must conform to the name as written upon the face of this Right
Certificate in every particular, without alteration or enlargement or any change
whatsoever.
In the event the certification set forth above in the Form of Assignment or
the Form of Election to Purchase, as the case may be, is not completed, such
Assignment or Election to Purchase will not be honored.
6.
Exhibit C
UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT
REFERRED TO BELOW, RIGHTS OWNED BY OR TRANSFERRED TO ANY PERSON WHO
BECOMES AN ACQUIRING PERSON (AS DEFINED IN THE RIGHTS AGREEMENT) AND
CERTAIN TRANSFEREES THEREOF WILL BECOME NULL AND VOID AND WILL NO
LONGER BE TRANSFERABLE.
SUMMARY OF RIGHTS TO PURCHASE
SHARES OF PREFERRED STOCK
On August 22, 1996 (the "Rights Dividend Declaration Date"), the Board of
Directors of Mylan Laboratories Inc. (the "Corporation") adopted a Shareholder
Rights Plan and declared that a dividend of one share purchase right ("Right")
be distributed on each outstanding share of Common Stock, par value $0.50 per
share ("Common Stock"), to shareholders of record as of the close of business on
September 5, 1996 (the "Record Date"). Each Right entitles the registered holder
to purchase from the Corporation one one-thousandth of a share of Series A
Preferred Stock, par value $0.50 per share ("Preferred Stock"), or, in certain
circumstances, shares of Common Stock, other securities, and/or cash or other
property, at a Purchase Price of $90 per share of Preferred Stock (or, when
applicable, Common Stock, securities, cash, and/or other property), subject to
adjustment. The complete terms and conditions of the Rights are set forth in a
Rights Agreement dated as of August 22, 1996 (the "Rights Agreement") between
the Corporation and American Stock Transfer & Trust Company, as Rights Agent.
All shares of Common Stock outstanding on the Record Date will receive Rights.
In addition, all shares of Common Stock issued prior to the Distribution Date
will be issued with Rights. All certificates for Common Stock issued after the
Record Date and prior to the Distribution Date will contain a legend
incorporating the Rights Agreement by reference.
Initially, the Rights will attach to the outstanding shares of Common
Stock, and no separate Right Certificates will be distributed. The Rights will
detach from the outstanding shares of Common Stock and separate Right
Certificates will be issued when there is a Distribution Date. Until a
Distribution Date occurs, the Rights will be evidenced by the certificate for
the shares of Common Stock with a copy of this Summary of Rights attached
thereto, the Rights will transfer with (and only with) the shares of Common
Stock to which such Rights are attached, and the transfer of any certificate for
Common Stock (with or without this Summary of Rights attached thereto) will also
constitute the transfer of the Rights attached to the shares of Common Stock
represented by such certificate.
A "Distribution Date" will occur on (i) the tenth day following a public
announcement that a person has become an Acquiring Person (the date of such
public announcement being the "Shares Acquisition Date"), or (ii) if earlier,
the tenth business day (or such later date as may be determined by the Board of
Directors prior to such time as any person becomes an Acquiring Person)
following the commencement or announcement of a tender or exchange offer that
would result in a person or group of affiliated or associated persons becoming
the Beneficial Owner of 15% or more of the outstanding shares of Common Stock.
1.
An "Acquiring Person" is a person or group of affiliated or associated
persons that Beneficially Owns 15% or more of the outstanding shares of Common
Stock but does not include (1) the Corporation, its subsidiaries, any employee
benefit plan of the Corporation or any of its Subsidiaries, or any entity
holding shares of Common Stock pursuant to the terms of any such plan; (2) any
person or group that becomes the Beneficial Owner of 15% or more of the
outstanding shares of Common Stock solely as a result of the acquisition of
Common Stock by the Corporation, unless such person or group thereafter acquires
additional shares of Common Stock; or (3) subject to certain conditions set
forth in the Rights Agreement, a person that otherwise would have become an
Acquiring Person as a result of an inadvertent acquisition of 15% or more of the
outstanding shares of Common Stock.
The Rights are not exercisable until the Distribution Date and will expire
at the close of business on September 5, 2006 (the "Final Expiration Date"),
unless the Final Expiration Date is extended or unless the Rights are earlier
redeemed or exchanged by the Corporation, in each case, as described below.
As soon as practicable after the Distribution Date, separate Right
Certificates will be mailed to the holders of record of Common Stock as of the
Distribution Date, and, thereafter, the Right Certificates alone will represent
the Rights.
The Purchase Price payable upon exercise of the Rights and the number of
shares of Preferred Stock (and the amount of other securities and/or property,
if any) issuable upon exercise of the Rights are subject to adjustment from time
to time to prevent dilution in the event that (i) there is a stock dividend on,
or a subdivision, combination, or reclassification of the Preferred Stock, or
(ii) the holders of Preferred Stock are granted certain options, warrants, or
rights to subscribe for or purchase shares of Preferred Stock (or equivalent
Preferred Stock) or securities convertible into Preferred Stock (or securities
convertible into equivalent Preferred Stock) at a price less than the current
market price of Preferred Stock, or (iii) any evidences of indebtedness or
assets (other than regular quarterly cash dividends or dividends payable in
shares of Preferred Stock) or any subscription rights or warrants (other than
rights, options, or warrants of the type referred to in clause (ii) of this
paragraph) are distributed to the holders of Preferred Stock.
Subject to certain exceptions as set forth in the Rights Agreement, no
adjustment in the Purchase Price will be required until the cumulative
adjustments amount to 1% of the Purchase Price.
The number of outstanding Rights and the number of one one-thousandths of a
share of Preferred Stock issuable upon exercise of each Right are also subject
to adjustment in the event of a stock split of the Common Stock or a stock
dividend on the shares of Common Stock payable in shares of Common Stock or
subdivisions, consolidations, or combinations of the shares of Common Stock
occurring, in any such case, prior to the Distribution Date.
No fractional shares of Preferred Stock (other than fractions that are
integral multiples of one one-thousandths of a share of Preferred Stock, which,
at the election of the Corporation, may be evidenced by depository receipts)
will be issued upon exercise of the Rights, but, in lieu thereof, a cash
adjustment will be paid to the holder of the exercised Rights based on the
market price of the Preferred Stock on the last trading date prior to the date
of exercise.
2.
Shares of Preferred Stock purchasable upon exercise of the Rights will not
be redeemable. The dividend, liquidation, and voting rights, and non-redemption
features of the Preferred Stock are designed so that the value of a one
one-thousandth interest in a share of Preferred Stock purchasable upon exercise
of each Right should approximate the value of one share of Common Stock. Each
whole share of Preferred Stock will be entitled to receive a quarterly
preferential dividend equal to the greater of (a) $1 or (b) 1000 times the
dividend declared with respect to each share of Common Stock. In the event of
liquidation, the holders of each whole share of Preferred Stock will be entitled
to receive a preferential liquidation payment equal to the greater of (a) $1000
or (b) 1000 times the payment made per share of Common Stock. Each share of
Preferred Stock will have 1000 votes, voting together with the shares of Common
Stock. Finally, in the event of any merger, consolidation, or other transaction
in which shares of Common Stock are exchanged for or changed into other stock or
securities, cash, and/or other property, each share of Preferred Stock will be
entitled to receive 1000 times the amount received per share of Common Stock.
These rights and preferences are protected by customary anti-dilution
provisions.
Once a person has become an Acquiring Person, all Rights that are, or
(under certain circumstances specified in the Rights Agreement) were,
Beneficially Owned by an Acquiring Person will be null and void.
In the event that any person becomes an Acquiring Person, proper provision
shall be made so that each holder of a Right (other than a Right that is or was
Beneficially Owned by an Acquiring Person that has become null and void pursuant
to the terms of the Rights Agreement), shall thereafter have the right to
receive upon exercise of such Right that number of shares of Common Stock (or,
in certain circumstances, Preferred Stock, other securities, property and/or
cash) having a value equal to two times the then-current Purchase Price.
In the event that, at any time after a person becomes an Acquiring Person,
(i) the Corporation is acquired in a merger or other business combination, or
(ii) 50% or more of the assets or earning power of the Corporation and its
Subsidiaries (taken as a whole) is sold or otherwise transferred, proper
provision will be made so that each holder of a Right (other than a Right that
is or was Beneficially Owned by an Acquiring Person that has become null and
void pursuant to the terms of the Rights Agreement) shall thereafter have the
right to receive upon exercise of such Right, in lieu of shares of Preferred
Stock, shares of common stock of the acquiror then having a current market value
equal to two times the then-current Purchase Price. The events referred to in
the preceding paragraph and in clauses (i) and (ii) of this paragraph are
hereinafter referred to as "Triggering Events."
At any time prior to the Close of Business on the tenth calendar day
following the Shares Acquisition Date (or, if the Shares Acquisition Date
occurred prior to the Record Date, the Close of Business on the tenth calendar
day following such Record Date), the Board of Directors of the Corporation may
redeem the Rights in whole, but not in part, at a price of $0.001 per Right,
subject to adjustment (the "Redemption Price") provided, however, that if such
authorization occurs on or after the date of a change (resulting from a proxy
solicitation) in a majority of the directors in office at the commencement of
such solicitation, and any Person who is or was a participant in such
solicitation has stated (or if upon the commencement of such solicitation, a
majority of the Board of Directors of the Company has determined in good faith)
that such Person (or any of its Affiliates or Associates) has taken or intends
to take, or may consider taking, any
3.
action that would result in such Person becoming an Acquiring Person or that
would cause the occurrence of a Triggering Event (the existence of the
circumstances described in this provision being referred to herein as an
"Adverse Change of Control"), then the Rights may be so redeemed only if there
are Continuing Directors in office and such redemption is authorized by a
majority of such Continuing Directors. The redemption of the Rights may be made
effective at such time, on such basis, and with such conditions as the Board of
Directors in its sole discretion may establish. Immediately upon any redemption
of the Rights, the right to exercise the Rights will terminate and the only
right of the holders of Rights will be to receive the Redemption Price.
At any time after any person becomes an Acquiring Person, and prior to the time
any person (other than the Corporation, any of its Subsidiaries, any employee
benefit plan of the Corporation or any of its Subsidiaries, and any entity
holding shares of Common Stock pursuant to the terms of any such plan) becomes
the Beneficial Owner of 50% or more of the outstanding shares of Common Stock,
the Corporation may, at the option and election of the Board of Directors,
exchange shares of Common Stock (or in certain circumstances, shares of
Preferred Stock) for all or any part of the then-outstanding and unexercised
Rights (other than Rights that are or were Beneficially Owned by an Acquiring
Person that have become null and void pursuant to the terms of the Rights
Agreement) at an exchange rate of one share of Common Stock (or in certain
circumstances, one one-thousandth of a share of Preferred Stock) per Right,
appropriately adjusted to reflect any stock dividend, stock split, reverse stock
split, or other similar transaction occurring after the Rights Dividend
Declaration Date.
The terms of the Rights may be amended by the Board of Directors of the
Corporation without the consent of the holders of the Rights, except that from
and after the Close of Business on the tenth calendar day following the Shares
Acquisition Date (or, if the Shares Acquisition Date occurred prior to the
Record Date, the Close of Business on the tenth calendar day following such
Record Date) no such amendment may adversely affect the interests of the holders
of the Rights (other than Rights that are or were Beneficially Owned by an
Acquiring Person that have become null and void pursuant to the terms of the
Rights Agreement) and provided, however, that if such amendment occurs on or
after an Adverse Change of Control, then the Rights Plan may be amended only if
there are Continuing Directors in office and such amendment is authorized by a
majority of such Continuing Directors.
Until a Right is exercised, the holder thereof, as such, will have no rights as
a shareholder of the Corporation, including, without limitation, the right to
vote or to receive dividends.
4.
Exhibit 4.2
5.
Form of Right Certificate
Certificate No. R-_______ _______ Rights
NOT EXERCISABLE AFTER SEPTEMBER 5, 2006 OR EARLIER IF REDEMPTION OR
EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $.001 PER
RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT
REFERRED TO BELOW. UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE
RIGHTS AGREEMENT, RIGHTS OWNED BY OR TRANSFERRED TO ANY PERSON WHO
BECOMES AN ACQUIRING PERSON (AS DEFINED IN THE RIGHTS AGREEMENT) AND
CERTAIN TRANSFEREES THEREOF WILL BECOME NULL AND VOID AND WILL NO
LONGER BE TRANSFERABLE.
Right Certificate
MYLAN LABORATORIES INC.
This certifies that ___________, or registered assigns, is the registered
owner of the number of Rights set forth above, each of which entitles the owner
thereof, subject to the terms, provisions and conditions of the Rights
Agreement, dated as of August 22, 1996, as the same may be amended from time to
time (the "Rights Agreement"), between Mylan Laboratories Inc., a Pennsylvania
corporation (the "Company"), and American Stock Transfer & Trust Company (the
"Rights Agent"), to purchase from the Company at any time after the Distribution
Date (as such term is defined in the Rights Agreement) and prior to 5:00 P.M.,
Eastern Standard time, on September 5, 2006 at the principal office of the
Rights Agent designated for such purpose, or of its successor as Rights Agent,
one one-thousandth of a fully paid, non-assessable share of Series A Junior
Participating Preferred Stock, par value $.50 per share (the "Preferred Stock"),
of the Company, at a purchase price of $90 per one one-thousandth of a share of
Preferred Stock (the "Purchase Price"), upon presentation and surrender of this
Right Certificate with the Form of Election to Purchase duly executed. The
number of Rights evidenced by this Rights Certificate (and the number of one
one-thousandths of a share of Preferred Stock which may be purchased upon
exercise hereof) set forth above, and the Purchase Price set forth above, are
the number and Purchase Price as of ________, 1996, based on the Preferred Stock
as constituted at such date. As provided in the Rights Agreement, the Purchase
Price, the number of one one-thousandths of a share of Preferred Stock which may
be purchased upon the exercise of the Rights and the number of Rights evidenced
by this Right Certificate are subject to modification and adjustment upon the
happening of certain events.
This Right Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Right Certificates. Copies of
the Rights
6.
Agreement are on file at the principal executive offices of the Company and the
above-mentioned offices of the Rights Agent.
This Right Certificate, with or without other Right Certificates, upon
surrender at the principal office of the Rights Agent, may be exchanged for
another Right Certificate or Right Certificates of like tenor and date
evidencing Rights entitling the holder to purchase a like aggregate number of
shares of Preferred Stock as the Rights evidenced by the Right Certificate or
Right Certificates surrendered shall have entitled such holder to purchase. If
this Right Certificate shall be exercised in part, the holder shall be entitled
to receive upon surrender hereof another Right Certificate or Right Certificates
for the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced by
this Certificate (i) may be redeemed by the Company at a redemption price of
$0.001 per Right or (ii) may be exchanged in whole or in part for shares of
Preferred Stock or shares of the Company's Common Stock, par value $0.50 per
share.
The Company shall not be required to issue fractional shares of Preferred
Stock upon the exercise of any Right or Rights evidenced hereby (other than
fractions which are integral multiples of one one-thousandth of a share of
Preferred Stock, which may, at the election of the Company, be evidenced by
depositary receipts), but in lieu thereof a cash payment will be made, as
provided in the Rights Agreement.
No holder of this Right Certificate, as such, shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of the Preferred Stock
or of any other securities of the Company which may at any time be issuable on
the exercise hereof, nor shall anything contained in the Rights Agreement or
herein be construed to confer upon the holder hereof, as such, any of the rights
of a shareholder of the Company or any right to vote for the election of
directors or upon any matter submitted to shareholders at any meeting thereof,
or to give or withhold consent to any corporate action, or to receive notice of
meetings or other actions affecting shareholders (except as provided in the
Rights Agreement) or to receive dividends or subscription rights, or otherwise,
until the Right or Rights evidenced by this Right Certificate shall have been
exercised as provided in the Rights Agreement.
This Right Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the Company and
its corporate seal.
Dated as of ____________.
ATTEST: MYLAN LABORATORIES, INC.
7.
By: ____________________________ By: ____________________________
Name: Name:
Title: Title:
Countersigned:
American Stock Transfer & Trust Company,
as Rights Agent
By: ___________________________
Authorized Signature
8.
Form of Reverse Side of Right Certificate
FORM OF ASSIGNMENT
(To be executed by the registered holder if such holder desires to transfer
the Right Certificate)
FOR VALUE RECEIVED _________________________ hereby sells, assigns and transfers
unto
-----------------------------------------------------------------------------
(Please print name and address of transferee)
Rights represented by this Right Certificate, together with all right, title and
interest therein, and does hereby irrevocably constitute and appoint
___________________ Attorney, to transfer said Rights on the books of the
within-named Company, with full power of substitution.
Dated: _________________ ______________________________
Signature
Signature Guaranteed:
Signatures must be guaranteed by an eligible guarantor institution (a bank,
stockbroker, savings and loan association or credit union with membership in an
approved signature guarantee medallion program) pursuant to Rule 17Ad-15 of the
Securities Exchange Act of 1934.
- ------------------------------------------------------------------------------
(To be completed)
The undersigned hereby certifies that the Rights evidenced by this Right
Certificate are not beneficially owned by, were not acquired by the undersigned
from, and are not being assigned to, an Acquiring Person or an Affiliate or
Associate thereof (as defined in the Rights Agreement).
- ------------------------------
Signature
9.
Form of Reverse Side of Right Certificate - continued
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise Rights represented by the
Right Certificate)
To Mylan Laboratories Inc.:
The undersigned hereby irrevocably elects to exercise __________________
Rights represented by this Right Certificate to purchase the shares of Preferred
Stock issuable upon the exercise of such Rights and requests that certificates
for such shares of Preferred Stock (or such other securities) be issued in the
name of:
Please insert social security
or other identifying number
- ------------------------------------------------------------------------------
(Please print name and address)
- ------------------------------------------------------------------------------
If such number of Rights shall not be all the Rights evidenced by this Right
Certificate, a new Right Certificate for the balance remaining of such Rights
shall be registered in the name of and delivered to:
Please insert social security
or other identifying number
- --------------------------------------------------------------------------------
(Please print name and address)
- ------------------------------------------------------------------------------
Dated: ____________________ ____________________________________
Signature
(Signature must conform to holder specified on Right Certificate)
Signature Guaranteed:
Signatures must be guaranteed by an eligible guarantor institution (a bank,
stockbroker, savings and loan association or credit union with membership in an
approved signature guarantee medallion program) pursuant to Rule 17Ad-15 of the
Securities Exchange Act of 1934.
10.
Form of Reverse Side of Right Certificate -- continued
- --------------------------------------------------------------------
(To be completed)
The undersigned certifies that the Rights evidenced by this Right
Certificate are not beneficially owned by, and were not acquired by the
undersigned from, an Acquiring Person or an Affiliate or Associate thereof (as
defined in the Rights Agreement).
Dated:_______________________ ___________________________________
Signature
NOTICE
The signature in the Form of Assignment or Form of Election to Purchase, as
the case may be, must conform to the name as written upon the face of this Right
Certificate in every particular, without alteration or enlargement or any change
whatsoever.
In the event the certification set forth above in the Form of Assignment or
the Form of Election to Purchase, as the case may be, is not completed, such
Assignment or Election to Purchase will not be honored.
11.