EXHIBIT 1
AMENDMENT NO. 1 TO RIGHTS AGREEMENT
THIS AMENDMENT NO. 1, dated as of November 27,
1996, is entered into between AGOURON PHARMACEUTICALS, INC.,
a California corporation (the "Company"), and XXXXX XXXXXX
SHAREHOLDER SERVICES, L.L.C., a New Jersey limited liability
company (the "Rights Agent"),
W I T N E S S E T H:
Whereas the Company and the Rights Agent have
entered into that certain Rights Agreement dated as of
November 7, 1996 (the "Rights Agreement"); and
Whereas the Company has determined to amend the
Rights Agreement by amending and restating the Certificate of
Determination, Preferences and Rights of Series B
Participating Preferred Stock attached as Exhibit A thereto;
and
Whereas the Company has determined that the
amendment represented hereby is in compliance with Section
27 of the Rights Agreement;:
N o w, T h e r e f o r e, in consideration of
the premises and the mutual agreements herein set forth, the
parties hereby agree as follows:
Section 1. Amendment. Exhibit A to the Rights
Agreement, the Certificate of Determination, Preferences
and Rights of Series B Participating Preferred Stock, is
hereby amended and restated to read in full as set forth on
Exhibit A hereto.
Section 2. Counterparts. This Amendment No. 1 may
be executed in any number of counterparts and each of such
counterparts shall for all purposes be deemed to be an
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original, but all such counterparts together shall constitute
one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused
this Amendment No. 1 to be duly executed as of the date and
year first above written.
AGOURON PHARMACEUTICALS, INC.
By /s/ Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx
President and
Chief Executive Officer
XXXXX XXXXXX SHAREHOLDER
SERVICES, L.L.C.
By /s/ Xxxxxx Lug
-----------------------------
Xxxxxx Lug
Vice President
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EXHIBIT A
CERTIFICATE OF DETERMINATION,
PREFERENCES AND RIGHTS
OF SERIES B PARTICIPATING PREFERRED STOCK
OF
AGOURON PHARMACEUTICALS, INC.
We, Xxxxx Xxxxxxx, President, and Xxxx X. Xxxxxxxx,
Secretary, of Agouron Pharmaceuticals, Inc., a corporation
organized and existing under the General Corporation Law of
the State of California, DO HEREBY CERTIFY:
1. That pursuant to the authority conferred upon the
Board of Directors by the Articles of Incorporation of the
Corporation, the said Board of Directors on November 7, 1996
adopted the following resolution creating a series of two
thousand (2,000) shares of Preferred Stock designated as
Series B Participating Preferred Stock:
"RESOLVED, that pursuant to the authority vested in the
Board of Directors of the Corporation in accordance with the
provisions of its Articles of Incorporation, a series of
Preferred Stock of the Corporation be and it hereby is
created, and that the designation and amount thereof and the
powers, preferences and relative, participating, optional and
other special rights of the shares of such series, and the
qualifications, limitations or restrictions thereof are as
follows:
Section 1. Designation and Amount. The shares of such
series shall be designated as "Series B Participating
Preferred Stock," no par value, and the number of shares
constituting such series shall be two thousand (2,000). Such
number of shares may be increased or decreased by resolution
of the Board of Directors; provided, that no decrease shall
reduce the number of shares of Series B Participating
Preferred Stock to a number less than that of the shares then
outstanding plus the number of shares issuable upon exercise
of outstanding rights, options or warrants or upon conversion
of outstanding securities issued by the Corporation.
Section 2. Dividends and Distributions.
(a) Subject to the prior and superior rights of the
holders of any shares of any series of Preferred Stock
ranking prior and superior to the shares of Series B
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Participating Preferred Stock with respect to dividends, the
holders of shares of Series B Participating Preferred Stock
in preference to the holders of shares of Common Stock, no
par value (the "Common Stock"), of the Corporation and 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 Date after
the first issuance of a share or fraction of a share of
Series B Participating Preferred Stock in an amount per share
(rounded to the nearest cent) equal to the greater of
(i) $100, or (ii) subject to the provision for adjustment
hereinafter set forth, 10,000 times the aggregate per share
amount of all cash dividends, and 10,000 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 B
Participating Preferred Stock. In the event the Corporation
shall at any time after the close of business on November 7,
1996 (the "Rights Declaration Date") (A) declare any dividend
on Common Stock payable in shares of Common Stock,
(B) subdivide the outstanding Common Stock, or (C) combine
the outstanding Common Stock into a smaller number of shares,
by reclassification or otherwise, then in each such case the
amount to which holders of shares of Series B Participating
Preferred Stock were entitled immediately prior to such event
under clause (ii) 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 B Participating Preferred Stock as
provided in paragraph (a) above 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 $100 per share
on the Series B Participating Preferred Stock shall
nevertheless be payable on such subsequent Quarterly Dividend
Payment Date.
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(c) Dividends shall begin to accrue and be cumulative
on outstanding shares of Series B Participating Preferred
Stock from the Quarterly Dividend Payment Date next preceding
the date of issue of such shares of Series B Participating
Preferred Stock 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 B Participating 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 B Participating 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 B
Participating Preferred Stock entitled to receive payment of
a dividend or distribution declared thereon, which record
date shall be no more than thirty (30) days prior to the date
fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of
Series B Participating Preferred Stock shall have the
following voting rights:
(a) Subject to the provision for adjustment hereinafter
set forth, each share of Series B Participating Preferred
Stock shall entitle the holder thereof to 10,000 votes on all
matters submitted to a vote of the shareholders of the
Corporation. In the event the Corporation shall at any time
after the Rights Declaration Date (i) declare any dividend on
Common Stock payable in shares of Common Stock,
(ii) subdivide the outstanding Common Stock into a greater
number of shares, or (iii) combine the outstanding Common
Stock into a smaller number of shares, by reclassification or
otherwise, then in each such case the number of votes per
share to which holders of shares of Series B Participating
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
outstanding immediately prior to such event.
(b) Except as otherwise provided herein or by law, the
holders of shares of Series B Participating Preferred Stock
and the holders of shares of Common Stock shall vote together
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as one class on all matters submitted to a vote of
shareholders of the Corporation.
(c) Except as set forth herein, holders of Series B
Participating 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 B Participating 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 B Participating
Preferred Stock outstanding shall have been paid in full, the
Corporation shall not:
(i) declare or pay dividends on, make any
other distributions on, or redeem or purchase or
otherwise acquire for consideration any shares of
stock ranking junior (either as to dividends or
upon liquidation, dissolution or winding up) to the
Series B Participating Preferred Stock;
(ii) declare or pay dividends on 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 B Participating Preferred Stock except
dividends paid ratably on the Series B Participating
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 on a
parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series B
Participating Preferred Stock provided that the
Corporation may at any time redeem, purchase or
otherwise acquire shares of any such parity 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 B Participating Preferred Stock; or
(iv) purchase or otherwise acquire for
consideration any shares of Series B Participating
Preferred Stock or any shares of stock ranking on a
parity with the Series B Participating Preferred
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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 B
Participating 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 to be created by
resolution or resolutions of the Board of Directors, subject
to the conditions and restrictions on issuance set forth
herein.
Section 6. Liquidation, Dissolution or Winding Up.
(a) Upon any liquidation (voluntary or otherwise),
dissolution or winding up of the Corporation, no distribution
shall be made to the holders of shares of stock ranking
junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series B Participating
Preferred Stock unless, prior thereto, the holders of shares
of Series B Participating Preferred Stock shall have received
per share, the greater of 10,000 times $1.00 or 10,000 times
the payment proposed to be made per share of Common Stock
pursuant to the second sentence of this Section 6(a), plus an
amount equal to accrued and unpaid dividends and distributions
thereon, whether or not declared, to the date of such
payment (the "Series B Liquidation Preference"). Following
the payment of the full amount of the Series B Liquidation
Preference, no additional distributions shall be made to the
holders of shares of Series B Participating Preferred Stock
unless, prior thereto, the holders of shares of Common Stock
shall have received an amount per share (the "Common
Adjustment") equal to the quotient obtained by dividing (i) the
Series B Liquidation Preference by (ii) 10,000 (as
appropriately adjusted as set forth in subparagraph (c) below to
reflect such events as stock
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splits, stock dividends and recapitalization with respect to
the Common Stock) (such number in clause (ii), the "Adjustment
Number"). Following the payment of the full amount of the Series
B Liquidation Preference and the Common Adjustment in respect
of all outstanding shares of Series B Participating Preferred
Stock and Common Stock, respectively, holders of Series B
Participating Preferred Stock and holders of shares of Common
Stock shall receive their ratable and proportionate share of the
remaining assets to be distributed in the ratio of the Adjustment
Number to 1 with respect to such Preferred Stock and Common Stock,
on a per share basis, respectively.
(b) In the event there are not sufficient assets
available to permit payment in full of the Series B Liquidation
Preference and the liquidation preferences of all other
series of Preferred Stock, if any, which rank on a parity
with the Series B Participating Preferred Stock then such
remaining assets shall be distributed ratably to the holders
of such parity shares in proportion to their respective
liquidation preferences. In the event there are not sufficient
assets available to permit payment in full of the
Common Adjustment, then such remaining assets shall be
distributed ratably to the holders of Common Stock.
(c) In the event the Corporation shall at any time
after the Rights Declaration Date (i) declare any dividend on
Common Stock payable in shares of Common Stock,
(ii) subdivide the outstanding Common Stock, or (iii) combine
the outstanding Common Stock into a smaller number of shares,
by reclassification or otherwise, then in each such case the
Adjustment Number in effect immediately prior to such event
shall be adjusted by multiplying such Adjustment 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.
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 the shares of Series B Participating Preferred Stock
shall at the same time be similarly exchanged or changed in
an amount per share (subject to the provision for adjustment
hereinafter set forth) equal to 10,000 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 after the Rights
Declaration Date (a) declare any dividend on Common Stock
payable in shares of Common Stock, (b) subdivide the
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outstanding Common Stock, or (c) combine the outstanding
Common Stock into a smaller number of shares, then in each
such case the amount set forth in the preceding sentence with
respect to the exchange or change of shares of Series B
Participating 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 are outstanding immediately prior to such event.
Section 8. Redemption. The shares of Series B
Participating Preferred Stock shall not be redeemable.
Section 9. Ranking. The Series B Participating
Preferred Stock shall rank junior to all other series of the
Corporation's Preferred Stock as to the payment of dividends
and the distribution of assets, unless the terms of any such
series shall provide otherwise.
Section 10. Amendment. The Articles of Incorporation
and the Bylaws of the Corporation shall not be further
amended (including, without limitation, pursuant to a
Certificate of Determination filed pursuant to the authority
granted by the Articles of Incorporation of the Corporation)
in any manner which would materially alter or change the
powers, preferences or special rights of the Series B
Participating Preferred Stock so as to affect them adversely
without the affirmative vote of the holders of at least
sixty-six and two-thirds percent (66-2/3%) of the outstanding
shares of Series B Participating Preferred Stock voting
separately as a class.
Section 11. Fractional Shares. Series B Participating
Preferred Stock may be issued in fractions of a share which
shall entitle the holder, in proportion to such holder's
fractional shares, to exercise voting rights, receive
dividends, participate in distributions and to have the
benefit of all other rights of holders of Series B
Participating Preferred Stock."
2. That no shares of Series B Participating Preferred
Stock have been issued.
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We further declare under penalty of perjury that the
matters set forth in the foregoing Certificate of
Determination are true and correct of our own knowledge.
Executed at La Jolla, California on November 19, 1996.
/s/ Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx, President
/s/ Xxxx X. Xxxxxxxx
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Xxxx X. Xxxxxxxx, Secretary
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