Exhibit 99.3
ALTERNATE VOTING AGREEMENT
VOTING AGREEMENT, dated as of June 24, 1998, between Mylan
Laboratories Inc., a Pennsylvania corporation ("Parent"), and ▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇▇, individually and in his capacity as the general partner of Prince
Ventures L.P. ("Ventures"), the general partner of Prince Venture Partners III,
L.P. (the "Stockholder").
WHEREAS, Parent and Penederm Incorporated, a Delaware corporation (the
"Company"), propose to enter into an Agreement and Plan of Merger, dated the
date hereof (as the same may be amended or supplemented, the "Merger Agreement")
providing for the merger of MLI Acquisition Corp., a Delaware corporation and
wholly-owned subsidiary of Parent ("Subsidiary"), with the Company (the
"Merger");
WHEREAS, the Stockholder is the beneficial owner of the number of
shares of common stock, par value $.01 per share, of the Company (the "Company
Common Stock") set forth on Schedule A hereto; such securities, as they may be
adjusted by stock dividend, stock split, recapitalization, combination or
exchange of shares, merger, consolidation, reorganization or other change or
transaction of or by the Company, together with securities that may be acquired
after the date hereof by the Stockholders, including Company Common Stock
issuable upon the exercise of options to purchase Company Common Stock (as the
same may be adjusted as aforesaid), being collectively referred to herein as the
"Securities"; and
WHEREAS, as a condition to their willingness to enter into the Merger
Agreement, Parent and Subsidiary have requested that the Stockholder enter into
this Agreement (capitalized terms not otherwise defined herein shall have the
meanings set forth in the Merger Agreement);
NOW, THEREFORE, to induce Parent and Subsidiary to enter into, and in
consideration of them entering into, the Merger Agreement, and in consideration
of the premises and the representations, warranties and agreements contained
herein and intending to be legally bound hereby, the parties hereby agree as
follows:
1. COVENANTS OF THE STOCKHOLDER. Stockholder agrees as follows:
(a) Except as contemplated by the terms of this Agreement (including, without
limitation to Section 1(d)), Stockholder shall not, (i) sell, transfer,
pledge, assign or otherwise dispose of, or enter into any agreement, option
or other arrangement (including any profit sharing arrangement) or
understanding with respect to the sale, transfer, pledge, assignment or
other disposition of, the Securities to any person other than Parent or
Parent's designee, (ii) enter into any voting arrangement, whether by
proxy, voting agreement, voting trust, power-of-attorney or otherwise, with
respect to the Securities or (iii) take any other action that would in any
way restrict, limit or interfere with the performance of its obligations
hereunder or the transactions contemplated hereby; provided, however, that
the Stockholder may transfer all or any part of his Securities to any
sibling or any other member of his immediate family, any of
his lineal descendants or any trust for the benefit of any of them, if the
recipient of the Securities agrees in advance in writing delivered to
Parent to be bound by this Agreement.
(b) Until the Merger is consummated or the Merger Agreement is terminated, the
Stockholder shall not, nor shall the Stockholder permit any investment
banker, financial adviser, attorney, accountant or other representative or
agent acting on behalf of or at the direction of the Stockholder (a
"Stockholder Representative") to, directly or indirectly (i) solicit,
initiate or encourage (including by way of furnishing information), or take
any other action designed or reasonably likely to facilitate, any inquiries
or the making of any proposal which constitutes, or may reasonably be
expected to lead to, any Takeover Proposal (as defined in the Merger
Agreement) or (ii) participate in any discussions or negotiations regarding
any Takeover Proposal. Without limiting the foregoing, it is understood
that any violation of the restrictions set forth in the preceding sentence
by a Stockholder Representative shall be deemed to be a violation of this
Section 1(b) by the Stockholder.
(c) At any meeting of stockholders of the Company called to vote upon the
Merger and the Merger Agreement or at any adjournment thereof or in any
other circumstances upon which a vote, consent or other approval (including
by written consent) with respect to the Merger and the Merger Agreement is
sought from the stockholders of the Company, Stockholder shall, including
by initiating a written consent solicitation if requested by Parent, vote
(or cause to be voted) such Stockholder's Securities in favor of approving
the Merger, the adoption of the Merger Agreement and the approval of the
other transactions contemplated by the Merger Agreement and the calling of
a special meeting of the stockholders of the Company to consider any of the
foregoing. At any meeting of stockholders of the Company or at any
adjournment thereof or in any other circumstances upon which Stockholder's
vote, consent or other approval is sought, Stockholder shall vote (or cause
to be voted) Stockholder's Securities against (i) any merger agreement or
merger (other than the Merger Agreement and the Merger), consolidation,
combination, sale or license of substantial assets, reorganization,
recapitalization, dissolution, liquidation or winding up of or by the
Company or any other Takeover Proposal (as defined in the Merger Agreement)
(collectively, "Alternative Transactions"), or (ii) any amendment of the
Company's Certificate of Incorporation or by-laws or other proposal or
transaction involving the Company or any of its subsidiaries or any motion
at a meeting of stockholders of the Company, which amendment or other
proposal or transaction or motion would in any manner impede, frustrate,
prevent or nullify, the Merger, the Merger Agreement or any of the other
transactions contemplated by the Merger Agreement including any consent to
the treatment of any Securities in or in connection with such transaction
(collectively, "Frustrating Transactions").
(d) Notwithstanding Sections 1(a) and (c), Parent and Subsidiary in reliance
upon Stockholder's representations and warranties contained in Section
3(e), agree that: (i) Stockholder may cause the Distribution (as defined
in Section 3(e)) to be made; and (ii) upon the effective date of the
Distribution (or such earlier date, if any, as any Securities are required
to be distributed in the event of an amendment of the Prince Partnership
Agreement), Stockholder shall cease to be bound by Section 1(c), and the
irrevocable proxy granted by Section 2 shall terminate, with respect to any
vote or consent that has not yet occurred (whether or not the applicable
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record date has passed) and each Distributee (as defined in Section 3(e))
shall be free to vote or consent as such Distributee chooses; provided,
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however, that Stockholder shall continue to be bound by all provisions of
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this Agreement with respect to any other Securities over which he retains
the power to vote after the effective date of the Distribution.
2. GRANT OF IRREVOCABLE PROXY COUPLED WITH AN INTEREST; APPOINTMENT OF PROXY.
(a) Stockholder hereby irrevocably grants to, and appoints, any individual who
shall be designated by Parent, and each of them, Stockholder's proxy and
attorney-in-fact (with full power of substitution), for and in the name,
place and stead of Stockholder, to vote Stockholder's Securities, or grant
a consent or approval in respect of such Securities, at any meeting of
stockholders of the Company or at any adjournment thereof or in any other
circumstances upon which their vote, consent or other approval is sought,
(i) in favor of the Merger, the adoption by the Company of the Merger
Agreement and the approval of the other transactions contemplated by the
Merger Agreement and the calling of a special meeting of the stockholders
of the Company to consider any of the foregoing, and (ii) against any
Alternative Transaction or Frustrating Transaction.
(b) Stockholder represents that any proxies heretofore given in respect of
Stockholder's Securities are not irrevocable, and that any such proxies are
hereby revoked.
(c) STOCKHOLDER HEREBY AFFIRMS THAT THE PROXY SET FORTH IN THIS SECTION 2 IS
COUPLED WITH AN INTEREST AND IS IRREVOCABLE UNTIL SUCH TIME AS THIS
AGREEMENT OR SUCH PROXY TERMINATES IN ACCORDANCE WITH ITS TERMS.
Stockholder hereby further affirms that such irrevocable proxy is given in
connection with the execution of the Merger Agreement, and that such
irrevocable proxy is given to secure the performance of the duties of
Stockholder under this Agreement. Stockholder hereby ratifies and confirms
all that the individual voting such irrevocable proxy may lawfully do or
cause to be done by virtue hereof. Such irrevocable proxy is executed and
intended to be irrevocable in accordance with the provisions of Section 212
of the DGCL. Such irrevocable proxy shall be valid until the later to
occur of (i) one year from the date hereof or (ii) the termination of this
Agreement in accordance with its terms.
3. REPRESENTATIONS AND WARRANTIES OF STOCKHOLDER. Stockholder hereby,
severally and not jointly, represents and warrants to Parent as follows:
(a) AUTHORIZATION. The Stockholder has the legal capacity to execute, deliver
and perform this Agreement. This Agreement constitutes a valid and binding
obligation of the Stockholder enforceable against the Stockholder in
accordance with its terms. If the Stockholder is married and the
Securities constitute community property under applicable law, this
Agreement has been duly authorized, executed and delivered by, and
constitutes the valid and binding agreement of, the Stockholder's spouse
enforceable against such spouse in accordance with its terms.
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(b) NO CONFLICT. The execution, delivery and performance by the Stockholder of
this Agreement and the consummation of the transactions contemplated hereby
do not and will not (i) result in any breach or violation of or be in
conflict with or constitute a default under any law or agreement or
arrangement to which the Stockholder is a party or by which the Stockholder
is bound, (ii) require any filing with or authorization by any governmental
entity or (iii) require any consent or other action by any person under,
constitute a default under, or give rise to any right of termination,
cancellation or acceleration of a loss of any benefit to which the
Stockholder is entitled under any provision of any agreement or other
instrument binding on the Stockholder.
(c) OWNERSHIP OF SECURITIES. Stockholder's Securities and the certificates
representing such Securities are now, and at all times during the term
hereof will be, held by Stockholder, or by a nominee or custodian for the
benefit of Stockholder, and Stockholder has good and marketable title to
such Securities, free and clear of any (i) liens, proxies, voting trusts or
agreements, understandings or arrangements and (ii) pledges, restrictions,
charges or other adverse claims of any kind or nature, except as described
in Section 3(e). Stockholder owns of record or beneficially no securities
of the Company, or any options, warrants or rights exercisable for
securities of the Company, other than the Securities set forth opposite the
Stockholder's name on Schedule A hereto.
(d) MERGER AGREEMENT. Stockholder understands and acknowledges that Parent and
Subsidiary are entering into the Merger Agreement in reliance upon the
Stockholder's execution and delivery of this Agreement.
(e) OTHER MATTERS. All of the Securities that constitute currently outstanding
shares of Company Common Stock (the "Current Securities") are owned by
Prince Venture Partners III, L.P. ("Prince"). The general partner of
Prince is Ventures. Stockholder is the general partner of Ventures and his
beneficial ownership of the Current Securities derives solely from his
status as the general partner of Ventures. Under the terms of the
Partnership Agreement governing Prince, Prince must be wound up on
September 15, 1998 and all of the assets of Prince are required to be
distributed to the individual partners of Prince (the "Distributees") by
that date (the "Distribution"), assuming that the Distributees have not
previously taken action to amend the terms of the Partnership Agreement
prior to that date. Stockholder, as the general partner of Ventures,
intends to cause Ventures, as the general partner of Prince, to effect the
Distribution as close in time to September 15, 1998 as is consistent with
the obligations of Ventures to ensure that the Distribution is timely made.
The Current Securities are included in the assets that will be the subject
of the Distribution.
4. FURTHER ASSURANCES. Stockholder will, from time to time, execute and
deliver, or cause to be executed and delivered, such additional or further
transfers, assignments, endorsements, consents and other instruments as Parent
may reasonably request for the purpose of effectively carrying out the
transactions contemplated by this Agreement and to vest the power to vote
Stockholder's Securities as contemplated by Section 2.
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5. ASSIGNMENT; BINDING EFFECT. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any of the parties
hereto (whether by operation of law or otherwise) without the prior written
consent of the other parties. Subject to the preceding sentence, this Agreement
shall be binding upon, inure to the benefit of, and be enforceable by, the
parties hereto and their respective successors and assigns. Notwithstanding
anything contained in this Agreement to the contrary, nothing in this Agreement,
expressed or implied, is intended to confer on any person other than the parties
hereto or their respective heirs, successors, executors, administrators and
assigns any rights, remedies, obligations or liabilities under or by reason of
this Agreement.
6. TERMINATION. Except as otherwise provided in Section 1(d), this Agreement,
and all rights and obligations of the parties hereunder, shall terminate upon
the earliest to occur of the Effective Time or the termination of the Merger
Agreement in accordance with its terms. Nothing in this Section 6 shall relieve
any party from liability for willful breach of this Agreement.
7. STOP TRANSFER. The Company agrees with, and covenants to, Parent that the
Company shall not register the transfer of any certificate representing any
Stockholder's Securities unless such transfer is made in accordance with the
terms of this Agreement.
8. GENERAL PROVISIONS.
(a) EXPENSES. All costs and expenses incurred by Parent in connection with
this Agreement and the transactions contemplated hereby shall be paid by
Parent. All costs and expenses incurred by Stockholder in connection with
this Agreement and the transactions contemplated hereby shall be paid by
the Company.
(b) AMENDMENTS. This Agreement may not be amended except by an instrument in
writing signed by each of the parties hereto.
(c) NOTICE. All notices and other communications hereunder shall be in writing
and shall be deemed given upon receipt to the parties at the following
addresses (or at such other address for a party as shall be specified by
like notice):
(i) if to Parent, to:
Mylan Laboratories Inc.
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▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy Number (▇▇▇) ▇▇▇-▇▇▇▇
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with a copy to:
▇▇▇▇ ▇. ▇▇▇▇▇▇, Esquire
▇▇▇▇▇▇▇▇ Ingersoll Professional Corporation
One Oxford Centre
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▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopy Number (▇▇▇) ▇▇▇-▇▇▇▇
and
(ii) if to a Stockholder, to the address set forth under
the name of such Stockholder on Schedule A hereto:
with a copy to:
▇▇▇▇▇ ▇▇▇▇▇▇, Esquire
▇▇▇▇▇▇ ▇▇▇▇▇▇ White & ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopy Number (▇▇▇) ▇▇▇-▇▇▇▇
(d) INTERPRETATION. When a reference is made in this Agreement to a Section,
such reference shall be to a Section of this Agreement unless otherwise
indicated. The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation
of this Agreement. Wherever the words "include", "includes" or "including"
are used in this Agreement, they shall be deemed to be followed by the
words "without limitation".
(e) COUNTERPARTS. This Agreement may be executed in two or more counterparts,
all of which shall be considered one and the same agreement and shall
become effective when two or more counterparts have been signed by each of
the parties and delivered to the other parties, it being understood that
all parties need not sign the same counterpart.
(f) ENTIRE AGREEMENT; NO THIRD-PARTY BENEFICIARIES. This Agreement (including
the documents and instruments referred to herein) (i) constitutes the
entire agreement and supersedes all prior agreements and understandings,
both written and oral, among the parties with respect to the subject matter
hereof and (ii) is not intended to confer upon any person other than the
parties hereto any rights or remedies hereunder.
(g) GOVERNING LAW. This Agreement shall be governed and construed in
accordance with the laws of the State of Delaware without regard to any
applicable conflicts of law.
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9. STOCKHOLDER CAPACITY. As of the date of this Agreement, Stockholder is a
director of the Company. Stockholder makes no agreement or understanding herein
in his capacity as a director or officer of the Company. Each Stockholder signs
solely in his capacity as the record holder and beneficial owner of, or the
trustee of a trust whose beneficiaries are the beneficial owners of,
Stockholder's Securities and nothing herein shall limit or affect any actions
taken by Stockholder in his capacity as an officer or director of the Company to
the extent specifically permitted by the Merger Agreement.
10. ENFORCEMENT. The parties agree that irreparable damage would occur in the
event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached. It is
accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement in a court of the United States.
This being in addition to any other remedy to which they are entitled at law or
in equity. In addition, each of the parties hereto waives any right to trial by
jury with respect to any claim or proceeding related to or arising out of this
Agreement or any of the transactions contemplated hereby.
STOCKHOLDER AGREES THAT, IN CONNECTION WITH ANY LEGAL SUIT OR PROCEEDING ARISING
WITH RESPECT TO THIS AGREEMENT, STOCKHOLDER SHALL SUBMIT TO THE JURISDICTION OF
THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE AND AGREES TO
VENUE IN SUCH COURTS. STOCKHOLDER HEREBY APPOINTS THE SECRETARY OF THE COMPANY
AS HIS AGENT FOR SERVICE OF PROCESS FOR PURPOSES OF THE FOREGOING SENTENCE ONLY.
EACH PARTY HERETO WAIVES ANY RIGHT TO JURY TRIAL IN CONNECTION WITH ANY SUCH
SUIT OR PROCEEDING.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
MYLAN LABORATORIES INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President
PRINCE VENTURE PARTNERS III L.P.
PRINCE VENTURES L.P.
General Partner
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇,
General Partner
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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SCHEDULE A
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STOCKHOLDER SECURITIES HELD
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▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ 270,091*
c/o Penederm Incorporated
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* Held as indicated in Section 3(e) of the foregoing Agreement.
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