EXHIBIT 4.1
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PHYSICIAN CORPORATION OF AMERICA
and
BOATMEN'S TRUST COMPANY
Rights Agent
AMENDMENT NO. 1 TO
RIGHTS AGREEMENT
Dated as of November 11, 1996
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AMENDMENT NO. 1 TO RIGHTS AGREEMENT
This Amendment No. 1 to Rights Agreement, dated as of November 11, 1996
(this "Amendment"), is between Physician Corporation of America, a Delaware
corporation (the "Company"), and Boatmen's Trust Company (the "Rights Agent").
The Company and the Rights Agent have entered into a Rights Agreement,
dated as of January 13, 1995 (the "Rights Agreement"). On November 2, 1996,
the Company, Sierra Health Services, Inc., a Nevada corporation ("Sierra"),
and Sierra Acquisition Corp., a Delaware corporation and a wholly-owned
subsidiary of Sierra ("Sierra Sub"), entered into an Agreement and Plan of
Merger (the "Merger Agreement"). The Company and the Rights Agent wish to
amend the Rights Agreement as provided below.
Accordingly, in consideration of the premises and the mutual agreements
herein set forth, the parties hereby agree as follows:
1. For purposes of this Amendment, the capitalized terms used herein
(in addition to those defined above) have the meaning indicated in the Rights
Agreement, except as otherwise set forth in this Amendment.
2. Section 1(a) of the Rights Agreement is hereby amended in its
entirety to read as follows:
"(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 then outstanding, but shall not include the Company, any
wholly-owned Subsidiary (as such term is hereinafter defined) of the Company,
any employee benefit plan of the Company or of any Subsidiary of the Company,
any Person holding Common Shares for or pursuant to the terms of any such
plan to the extent, and only to the extent, of the Common Shares so held or
the Exempt Person (as such term is hereinafter defined); "Exempt Person"
shall mean Sierra or any Affiliate of Sierra so long as neither Sierra nor
any Affiliate of Sierra is the Beneficial Owner of any Common Shares other
than Common Shares of which Sierra or any Subsidiary of Sierra is the
Beneficial Owner solely by reason of the execution, delivery or performance
of the Merger Agreement. 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 more of the Common Shares then outstanding; PROVIDED, HOWEVER, that if a
Person becomes the Beneficial Owner of 15% or more of the Common Shares
then outstanding by reason of share acquisitions by the Company and shall,
after such share acquisitions by the Company, become the Beneficial Owner of
any additional Common Shares, then such Person shall be deemed to be an
"Acquiring Person"."
3. Section 3 of the Rights Agreement is hereby amended in its entirety to
read as follows:
"Section 3. ISSUE OF RIGHT CERTIFICATES.
(a) Until the earlier (the earlier of such dates being herein
referred to as the "Distribution Date") of (i) the close of
business on the tenth Business Day after the Shares Acquisition
Date and (ii) the close of business on the tenth Business Day after
the date of the commencement by any Person (other than the Company,
any wholly-owned Subsidiary of the Company, any employee benefit
plan of the Company or of any wholly-owned Subsidiary of the
Company, any entity holding Common Shares for or pursuant to the
terms of any such plan, to the extent such entity is so acting with
the approval or consent of the Company, or the Exempt Person) of,
or of the first public announcement of the intention of any Person
(other than the Company, any wholly-owned Subsidiary of the
Company, any employee benefit plan of the Company or of any
wholly-owned Subsidiary of the Company, any entity holding Common
Shares for or pursuant to the terms of any such plan, to the extent
such entity is so acting with the approval or consent of the
Company or as part of its ordinary activities with respect to any
such plan, or the Exempt Person) to commence, a tender or exchange
offer the consummation of which would result in any Person becoming
the Beneficial Owner of 15% or more of the Common Shares then
outstanding (including any such date which is after the date of
this Agreement and prior to the issuance of the Rights), (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 of the Company. 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
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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 A hereto (a "Right Certificate"), evidencing one
Right for each Common Share of the Company so held. As of the
Distribution Date, the Rights will be evidenced solely by such
Right Certificates."
4. Section 7(a) of the Rights Agreement is hereby amended in its
entirety to read as follows:
"Section 7. EXERCISE OF RIGHTS; PURCHASE PRICE; EXPIRATION DATE OF
RIGHTS.
(a) 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, subject to the last sentence of
Section 23(a) hereof, 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, together with payment of the
Purchase Price for each Common Share as to which the Rights are
exercised, at or prior to the earliest of (i) the close of business
on January 13, 2005 (the "Final Expiration Date"), (ii) the time at
which the Rights are redeemed as provided in Section 23 hereof (the
"Redemption Date"), (iii) the time at which such Rights are
exchanged as provided in Section 24 hereof and (iv) immediately
before the effective time of the merger set forth in the Merger
Agreement."
5. Section 25(a) of the Rights Agreement is hereby amended in its
entirety to read as follows:
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 Common Shares or to
make any other distribution to the holders of Common Shares (other
than a regular quarterly cash dividend), (ii) to offer to the
holders of Common Shares rights or warrants to subscribe for or to
purchase any additional Common Shares or shares of stock of any
class or any other securities, rights or options (iii) to effect
any reclassification of Common Shares (other than a
reclassification involving only the subdivision of outstanding
Common 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
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of the Company and its Subsidiaries (taken as a whole) to, any
other Person (other than the Exempt Person), or (v) to effect the
liquidation, dissolution or winding up of the Company, then, in
each such case, the Company shall give to each holder of a Right
Certificate, in accordance with Section 26 hereof, a notice of such
proposed action, which shall specify the record date for purposes
of such stock dividend, or distribution of rights or warrants, or
the date on 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, if any such date is to be fixed, and such notice
shall be so given in the case of any action described by clause (i)
or (ii) above at least 10 days prior to the record date for
determining holders of the Common 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,
whichever shall be the earlier."
6. The Rights Agreement is hereby amended by adding a Section 35 to read
as follows:
"Section 35. SIERRA MERGER. Anything in this Agreement to the
contrary notwithstanding, in no event shall the execution, delivery
or performance of the Merger Agreement (including without
limitation the consummation of the merger set forth in the Merger
Agreement and the exchange of Common Shares for the shares of
Sierra Common Stock (as defined in the Merger Agreement) in
accordance with Article II of the Merger Agreement) cause (A) the
Rights to become exercisable, (B) Sierra or any Affiliate of Sierra
to be deemed an "Acquiring Person", or (C) the "Shares Acquisition
Date" to occur upon any such event and (ii) the "Final Expiration
Date" shall occur immediately prior to the Effective Time (as
defined in the Merger Agreement)."
7. This Amendment shall be deemed effective as of 12:01 a.m., Miami,
Florida time, on November 2, 1996, as if executed by both parties at such
time. Except as expressly set forth herein, the terms and provisions of the
Rights Agreement shall continue in full force and effect.
8. Upon effectiveness of this Amendment, each reference in the Rights
Agreement, to "this Agreement", "hereunder", "herein" or words of like import
shall be a reference to the Rights Agreement, as amended by this Amendment.
9. This Amendment shall be construed and enforced in accordance with
and governed by the laws of the State of Delaware.
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10. This Amendment may be executed in any number of counterparts, 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.
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.
Attest: PHYSICIAN CORPORATION
OF AMERICA
By By
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Xxxx X. Xxxxxxx E. Xxxxxxx Xxxxxxxxx, M.D.
Secretary Chairman of the Board
Attest: BOATMEN'S TRUST COMPANY
By By
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Xxxxx Xxxxx Xxxxx X. Xxxxxx
Assistant Vice President and Vice President and
Assistant Secretary Assistant Secretary
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