EXHIBIT 4.6
RIGHTS AGREEMENT AMENDMENT
This Amendment, dated as of November 9, 2002, to the Rights
Agreement, dated as of June 5, 1998 (the "Rights Agreement"), is between Hyseq,
Inc., a Nevada corporation (the "Company"), and U.S. Stock Transfer Corporation,
as Rights Agent (the "Rights Agent").
The Company and the Rights Agent have heretofore executed and
entered into the Rights Agreement. Pursuant to Section 26 of the Rights
Agreement, the Company and the Rights Agent may from time to time supplement or
amend the Rights Agreement in accordance with the provisions of Section 26
thereof and the Company desires and directs the Rights Agent to so amend the
Rights Agreement. All acts and things necessary to make this Amendment a valid
agreement according to its terms have been done and performed, and the execution
and delivery of this Amendment by the Company and the Rights Agent have been in
all respects authorized by the Company and the Rights Agent.
In consideration of the foregoing premises and mutual agreements
set forth in the Rights Agreement and this Amendment, the parties hereto agree
as follows:
1. Section 1.1 of the Rights Agreement is hereby modified and
amended to read in its entirety as follows:
"1.1. (a) Subject to Section 1.1(b), "ACQUIRING PERSON" shall
mean any Person who or which, together with all Affiliates and
Associates of such Person, shall be the Beneficial Owner of 15%
or more of the Common Shares of the Company then outstanding, but
shall not include (i) the Company Group or any member or members
thereof (ii) the Existing Holder so long as the Existing Holder
shall be the Beneficial Owner of not greater than 40% of the
Common Shares of the Company then outstanding (iii) Variagenics,
Inc., a Delaware corporation, or any Affiliate or Associate
thereof (collectively, "Variagenics"), (iv) Shareholder 1, or any
Affiliate or Associate thereof (collectively, "Shareholder 1") or
(v) Shareholder 2, or any Affiliate or Associate thereof
(collectively, "Shareholder 2"); provided, however, that
Variagenics, Shareholder 1 and Shareholder 2 will become an
"Acquiring Person" in the event that he, she or it, as the case
may be, becomes the Beneficial Owner of an aggregate of 15% or
more of the Common Shares of the Company then outstanding other
than pursuant to the terms of the Agreement and Plan of Merger
dated as of November 9, 2002 (the "Merger Agreement"), among the
Company, Vertical Merger Corp., a Delaware corporation, and
Variagenics, the Voting Agreements (as defined in the Merger
Agreement) or the transactions contemplated thereby. "EXISTING
HOLDER" shall mean Xxxxxx X. Xxxxxxxx together with all of his
Affiliates and Associates, until such time as Xxxxxx
X. Xxxxxxxx, together with all of his Affiliates and Associates,
cease to beneficially own any Common Shares. Notwithstanding the
foregoing, 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
to 15% (or, in the case of the Existing Holder, 40%) or more of
the Common Shares of the Company then outstanding; provided,
however, that if a Person other than the Existing Holder shall
become the Beneficial Owner of 15% or more of the Common Shares
of the Company then outstanding solely 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. Notwithstanding the foregoing, 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 Section 1.1, 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 Section 1.1, then such Person shall
not be deemed to be an Acquiring Person at any time for any
purposes of this Agreement.
(b) Notwithstanding anything in this Rights Agreement to the
contrary, the term Acquiring Person shall not include any Person
that is an Approved Stockholder (so long as such Person remains
an Approved Stockholder), and no Approved Stockholder 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 to more than 27.5% of the
Common Shares of the Company then outstanding; provided, however,
that if such Person shall become the Beneficial Owner of more
than 27.5% of the Common Shares of the Company then outstanding
solely 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.""
2. Section 1.12 of the Rights Agreement is hereby amended by
adding as the final sentence thereto the following:
"Notwithstanding anything in the Agreement to the contrary, no
Shares Acquisition Date shall be deemed to have occurred solely
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as a result of the approval, execution and/or delivery of the
Merger Agreement and/or the Voting Agreements (as defined in the
Merger Agreement), and/or the consummation of the transactions
contemplated thereby."
3. Section 3.1 of the Rights Agreement is hereby amended by
adding as the final sentence thereto the following:
"Notwithstanding anything in the Agreement to the contrary, no
Distribution Date shall be deemed to have occurred solely as a
result of the approval, execution and/or delivery of the Merger
Agreement and/or the Voting Agreements (as defined in the Merger
Agreement), and/or the consummation of the transactions
contemplated thereby."
4. Section 11.1.2 of the Rights Agreement is hereby amended by
adding as the final sentence thereto the following:
"Notwithstanding anything in the Agreement to the contrary, no
rights under this Section 11.1.2 shall arise or be triggered, and
no event described in Section 11.1.2 shall be deemed to have
occurred solely as a result of the approval, execution and/or
delivery of the Merger Agreement and/or the Voting Agreements (as
defined in the Merger Agreement), and/or the consummation of the
transactions contemplated thereby."
5. Section 13.2 of the Rights Agreement is hereby amended by
adding as the final sentence thereto the following:
Notwithstanding anything in this Agreement to the contrary, none
of the approval, execution and/or delivery of the Merger
Agreement and/or the Voting Agreements (as defined in the Merger
Agreement), and/or the consummation of the transactions
contemplated thereby shall result in the termination of the this
Agreement or the Rights."
6. Except as expressly amended hereby, the Rights Agreement
remains in full force and effect in accordance with its terms.
7. This Amendment to the Rights Agreement shall be governed by
and construed in accordance with the laws of the State of Delaware.
8. This Amendment to the Rights Agreement may be executed in any
number of counterparts and each of such counterparts shall for all purposes be
deemed an original, and all such counterparts shall together constitute but one
and the same instrument.
9. Except as expressly set forth herein, this Amendment to the
Rights Agreement shall not by implication or otherwise alter, modify, amend or
in any way affect any of
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the terms, conditions, obligations, covenants or agreements contained in the
Rights Agreement, all of which are ratified and affirmed in all respects and
shall continue in full force and effect.
10. Capitalized terms used herein but not defined shall have the
meanings given to them in the Rights Agreement.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to the Rights Agreement to be duly executed as of the day and year first above
written.
HYSEQ, INC.
By: /s/ Xxx X. Love
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Name: Xxx X. Love
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Title: President and CEO
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U.S. STOCK TRANSFER CORPORATION
as Rights Agent
By: /s/ Xxxxxxx Xxxxxx
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Name: Xxxxxxx Xxxxxx
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Title: Assistant Vice President
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