Amendment Number 2 to Rights Agreement
Pursuant to Section 27 of the Rights Agreement, dated as of
November 11, 1999, by and between Xxxxxx Laboratories, an Illinois
corporation (the "Company") and BankBoston, N.A., a national banking
association (the "Rights Agent"), the Company and the Rights Agent, as
amended by Amendment Number 1 to Rights Agreement dated as of December 7,
1999 (as so amended, the "Rights Agreement"), hereby agree that the Rights
Agreement shall be further amended as follows:
1. Section 1 of the Rights Agreement is amended by restating in
its entirety the definition of the term "Acquiring Person" as follows:
"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 10% or more of the Common Shares of the Company then
outstanding, but shall not include (i) the Company, (ii) any
Subsidiary (as such term is hereinafter defined) of the Company,
or (iii) any employee benefit plan of the Company or of any
Subsidiary of the Company or any Person holding Common Shares for
or pursuant to the terms of any such plan. Notwithstanding the
foregoing, no Person shall become an "Acquiring Person" as the
result of (i) an acquisition of Common Shares by the Company
which, by reducing the number of Common Shares outstanding,
increases the proportionate number of Common Shares beneficially
owned by such Person to 10% or more of the Common Shares of the
Company then outstanding, or (ii) the acquisition by such Person
of newly- issued Common Shares directly from the Company (it being
understood that a purchase from an underwriter or other
intermediary is not deemed for purposes hereof to be a purchase
directly from the Company); provided, however, that if a Person
shall become the Beneficial Owner of 10% or more of the Common
Shares of the Company then outstanding by reason of share
purchases by the Company or the receipt of newly-issued Common
Shares directly from the Company and shall, after such share
purchases or direct issuance 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"; and provided,
further, that any transferee from such Person who becomes the
Beneficial Owner of 10% or more of the Common Shares of the
Company then outstanding shall nevertheless 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 paragraph, has become such
inadvertently, and such Person divests as promptly as practicable
(and in any event within ten Business Days after notification by
the Company) 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, then such Person
shall not be deemed to be an "Acquiring Person" for any purposes
of this Agreement.
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2. Section 1 of the Rights Agreement is further amended by
deleting entirely the definitions of the terms "Business Combination
Transaction," "Change in Control," "Solicitation Participant," "Special
Meeting," and "Third Party Solicitation."
3. Section 23 of the Rights Agreement is amended and restated in
its entirety as follows:
Section 23. Redemption.
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(a) The Board of Directors of the Company may, at its
option, at any time prior to such time as any Person becomes an
Acquiring Person, redeem all but not less than all of the then
outstanding Rights at a redemption price of $.0001 per Right,
appropriately adjusted to reflect any stock split, stock dividend
or similar transaction occurring after the date hereof (such
redemption price being hereinafter referred to as the "Redemption
Price"). The Company may, at its option, pay the Redemption Price
in cash, Common Shares (based on the current per share market
price of the Common Shares at the time of redemption) or any other
form of consideration deemed appropriate by the Board of
Directors. Subject to the Provisions of this Section 23(a), 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. If
redemption of the Rights is to be effective as of a future date,
the Rights shall continue to be exercisable, subject to Section 7
hereof, until the effective date of the redemption, provided that
the Board of Directors may subsequently cause the Rights to be
redeemed at a date earlier than the scheduled effective date of
the redemption.
(b) Immediately upon the action of the Board of Directors ordering
the redemption of the Rights (or at the effective time of such
redemption established by the Board of Directors of the Company
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, with simultaneous written
notice to the Rights Agent, 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 or, if later, the effectiveness of the
redemption of the Rights pursuant to the last sentence of
paragraph (a), 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 which is
mailed in the manner herein provided shall be deemed given,
whether or not the holder receives the notice. Each such notice of
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redemption will state the method by which the payment of the
Redemption Price will be made. The Company may, at its option,
discharge all of its obligations with respect to the Rights by (i)
issuing a press release announcing the manner of redemption of the
Rights, (ii) depositing with a bank or trust company having a
capital and surplus of at least $100,000,000, funds necessary for
such redemption, in trust, to be applied to the redemption of the
Rights so called for redemption and (iii) arranging for the
mailing of the Redemption Price to the registered holders of the
Rights. Upon such action, all outstanding Right Certificates shall
be null and void without further action by the Company. 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, in
Section 24 hereof, or in connection with the purchase of Common
Shares prior to the Distribution Date.
4. Section 24(a) of the Rights Agreement is amended and restated
in its entirety as follows:
(a) The Company may, at its option, at any time after a
Triggering Event, upon resolution of a majority of the Board of
Directors, 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 the "Exchange Ratio"). Notwithstanding the
foregoing, the Company shall not effect such an exchange at any
time after 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) becomes the Beneficial
Owner of 50% or more of the then outstanding Common Shares.
5. Section 27 of the Rights Agreement is amended and restated
in its entirety as follows:
Section 27. Supplements and Amendments. Subject to the
restrictions of this Section 27, the Company may from time to
time, and the Rights Agent shall, if so directed by the Company,
supplement or amend any provision of 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
which may be defective or inconsistent with any other provisions
herein, or to amend, supplement, add or delete any provision
hereof which 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 such time as any Person becomes an Acquiring Person, this
Agreement shall not be supplemented or amended in any manner which
would adversely affect the interests of the holders of Rights
(other than an Acquiring Person or an Affiliate or an Associate of
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an Acquiring Person). Prior to the Distribution Date, the interests
of the holders of Rights shall be deemed coincident with the interests
of the holders of Common Shares. Upon the delivery of a certificate
from an appropriate officer of the Company which states that the
proposed supplement or amendment is in compliance with the terms
of this Section, the Rights Agent shall execute such supplement or
amendment. Notwithstanding any other provision hereof, the Rights
Agent's consent must be obtained regarding any amendment or
supplement pursuant to this Section 27 which alters the Rights
Agent's rights or duties.
6. The Form of Right Certificate attached as Exhibit B to the
Rights Agreement is amended by entirely deleting the phrase "; PROVIDED,
HOWEVER, that following a Change in Control the Rights may only be redeemed
with the prior approval of at least 85% of the Common Shares then
outstanding" from the sixth full paragraph thereof.
7. Other than as set forth herein, all other provisions of the
Rights Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
Number 2 to the Rights Agreement as of May 19, 2000.
XXXXXX LABORATORIES
By: /s/ Xxxx X. xx Xxxx
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Name: Xxxx X. xx Xxxx
Its: Senior Vice President,
Secretary and General Counsel
BANKBOSTON, N.A., as Rights Agent
By: /s/ Xxx Xxxxx
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Name: Xxx Xxxxx
Its: Director, Client Services
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