EXHIBIT 1
AMENDMENT TO RIGHTS AGREEMENT
THIS AMENDMENT (the "Amendment"), is entered into as of June 2,
1999, by and between TRIANGLE PHARMACEUTICALS, INC., a Delaware corporation (the
"Company"), and AMERICAN STOCK TRANSFER & TRUST COMPANY, as Rights Agent (the
"Rights Agent").
RECITALS
A. The Company and the Rights Agent are parties to a Rights
Agreement dated as of February 1, 1999 (the "Rights Agreement").
X. Xxxxxx Laboratories, an Illinois corporation ("Abbott"), and
the Company have entered into a Collaboration Agreement made as of June 2, 1999
(the "Collaboration Agreement"), pursuant to which the parties shall collaborate
with respect to the clinical development, registration, distribution and
marketing of various drugs.
C. In connection with the Collaboration Agreement, Abbott and
the Company have entered into, among other agreements, (i) a Common Stock
Purchase Agreement, made as of June 2, 1999 (the "Abbott Stock Purchase
Agreement"), pursuant to which Abbott is to purchase the Shares (as such term is
defined in Section 1.4 of the Abbott Stock Purchase Agreement) and (ii) a
Stockholder Rights Agreement made as of June 2, 1999 (the "Abbott Rights
Agreement").
D. Pursuant to Section 3.9 of the Abbott Stock Purchase
Agreement and Section 7.1 of the Abbott Rights Agreement, the Board of Directors
of the Company has determined that an amendment to the Rights Agreement as set
forth herein is necessary and desirable to reflect the foregoing and certain
other matters and the Company and the Rights Agent desire to evidence such
amendment in writing.
Accordingly, the parties agree that:
1. AMENDMENT TO DEFINITION OF "ACQUIRING PERSON" SET FORTH IN SECTION
1(A). The definition of "Acquiring Person" set forth in Section 1(a) of the
Rights Agreement is amended to read in its entirety 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 shares of Common Stock of the Company then
outstanding but shall not include (1) the Company, any Subsidiary (as
such term is hereinafter defined) of the Company, any employee benefit
plan of the Company or any Subsidiary of the Company, or any entity
holding shares of Common Stock for or pursuant to the terms of any such
plan, (2) during the Interim Period (as defined below), Xxxxxx
Laboratories, an Illinois corporation (the "Permitted Investor"), or
any U.S. wholly-owned subsidiaries of Abbott (collectively with the
Permitted Investor, the
"Investor Group") but only to the extent that the Permitted Investor
may be deemed a Beneficial Owner of the Shares (as defined below) as a
result of the Permitted Investor entering into the Abbott Stock
Purchase Agreement (as defined below), unless the Permitted Investor
becomes the Beneficial Owner (as defined in the Abbott Rights Agreement
(as defined below)) of any additional securities of the Company other
than the Shares during the Interim Period, or (3) during the Threshold
Period (as hereinafter defined), the Investor Group. For purposes of
this Agreement, the "Interim Period" shall mean such period commencing
as of the date of the Abbott Stock Purchase Agreement and ending on the
earlier of (x) the "Effective Date" as such term is defined in the
Collaboration Agreement (as defined below) and (y) termination of the
Abbott Stock Purchase Agreement. For purposes of this Agreement, the
"Threshold Period" shall mean such period commencing as of the
Effective Date under the Collaboration Agreement and ending on the
earlier of (xx) such time as the Permitted Investor holds less than the
Minimum Purchaser Interest in the Company (as defined in Section 1.11
of the Abbott Rights Agreement), (yy) such time as the Investor Group's
Beneficial Ownership (as the term Beneficial Ownership is defined in
the Abbott Rights Agreement) exceeds the Beneficial Ownership
Limitation (as defined in Section 5.2(a) of the Abbott Rights
Agreement), and (zz) such time as the Permitted Investor's rights under
Section 7.1 of the Abbott Rights Agreement have terminated pursuant to
the terms of the Abbott Rights Agreement. Notwithstanding the
foregoing:
(i) no Person shall become an "Acquiring Person" as
the result of an acquisition of shares of Common Stock by the Company
which, by reducing the number of shares outstanding, (a) increases the
proportionate number of shares beneficially owned by such Person to 15%
or more of the shares of Common Stock of the Company then outstanding,
or, (b) in the case of the Investor Group during the Interim Period,
increases the proportionate number of shares which may be deemed
beneficially owned by the Investor Group, unless the Permitted Investor
becomes the Beneficial Owner (as defined in the Abbott Rights
Agreement) of any additional securities of the Company other than the
Shares during the Interim Period, or, (c) in the case of the Investor
Group during the Threshold Period, increases the proportionate number
of shares Beneficially Owned (as defined in the Abbott Rights
Agreement) by the Investor Group to more than the Beneficial Ownership
Limitation; provided, however, that if by reason of share purchases by
the Company, (1) a Person shall become the Beneficial Owner of 15% or
more of the shares of Common Stock of the Company then outstanding or,
(2) in the case of the Investor Group, the Investor Group's ownership
increases the Investor Group's Beneficial Ownership (as defined in the
Abbott Rights Agreement) by any amount during the Interim Period or
results in the Investor Group's Beneficial Ownership (as defined in the
Abbott Rights Agreement) to exceed the Beneficial Ownership Limitation
at any time during the Threshold Period, and, in the case of (1) or (2)
above, such Person or Investor Group shall, after such share purchases
by the Company, become the Beneficial Owner of any additional shares of
Common Stock of the Company, then such Person, including the Investor
Group, shall be deemed to be an "Acquiring Person" hereunder; and
(ii) 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
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foregoing provisions of this paragraph (a), has become such
inadvertently, and such Person divests as promptly as practicable a
sufficient number of shares of Common Stock so that such Person would
no longer be an "Acquiring Person" (as defined pursuant to the
foregoing provisions of this paragraph (a)), then such Person shall not
be deemed to be an "Acquiring Person" for any purpose of this
Agreement."
2. AMENDMENT TO DEFINITION OF "TRIGGERING EVENT" SET FORTH IN
SECTION 1(OO). The definition of "Triggering Event" set forth in Section 1 (oo)
of the Rights Agreement is amended to add the following sentence to the end
thereof:
"Notwithstanding anything in this Rights Agreement to the contrary, a
Triggering Event shall not be deemed to have occurred by virtue of the
Abbott Stock Purchase Agreement and the Related Agreements (as such
term is defined in the Abbott Stock Purchase Agreement) or by virtue of
any of the transactions contemplated thereby (excluding during the
Interim Period, any purchases which result in the Permitted Investor
becoming the Beneficial Owner (as defined in the Abbott Rights
Agreement) of any securities of the Company in addition to the Shares
and excluding, during the Threshold Period, any purchases permitted by
Section 5.3 of the Abbott Rights Agreement or otherwise which cause the
Permitted Investor's Beneficial Ownership (as defined in Section 5.4 of
the Abbott Rights Agreement) of shares of Common Stock to exceed 21% of
the then total outstanding shares of Common Stock of the Company)."
3. AMENDMENT TO SECTION 1. The following definitions are hereby added
to the end of Section 1 as Sections 1(pp), 1(qq), 1(rr) and 1(ss):
"(pp) "Abbott Rights Agreement" shall mean that certain Stockholder
Rights Agreement made as of June 2, 1999, by and between the Company
and Xxxxxx Laboratories.
(qq) "Abbott Stock Purchase Agreement" shall mean that certain Common
Stock Purchase Agreement made as of June 2, 1999, by and between the
Company and Xxxxxx Laboratories.
(rr) "Collaboration Agreement" shall mean that certain Collaboration
Agreement made as of June 2, 1999, by and between the Company and
Xxxxxx Laboratories.
(ss) "Shares" shall have the meaning assigned to such term in the
Abbott Stock Purchase Agreement."
4. AMENDMENT OF SECTION 3(A). The first sentence of Section 3(a) of
the Rights Agreement is amended to read in its entirety as follows:
"Until the earlier of (i) the Close of Business on the Shares
Acquisition Date and (ii) the Close of Business on the tenth Business
Day (or such later date as may be determined by action of the Company's
Board of Directors prior to such time as any Person becomes an
Acquiring Person and of which the Company will give the Rights Agent
prompt written notice) after the date that a tender or exchange offer
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by 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 shares of Common Stock for or pursuant to
the terms of any such plan) is first published or sent or given within
the meaning of Rule 14d-4(a) of the Exchange Act Regulations or any
successor rule or of the first public announcement of the intention of
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 shares of Common Stock for or pursuant to
the terms of any such plan) to commence, a tender or exchange offer, if
upon consummation thereof such Person would be the Beneficial Owner of
15% or more of the shares of Company Common Stock then outstanding, or,
in the case of the Investor Group during the Interim Period, the
Investor Group purchases any securities of the Company which result in
the Permitted Investor becoming the Beneficial Owner (as defined in the
Abbott Rights Agreement) of any securities of the Company in addition
to the Shares, or in the case of the Investor Group during the
Threshold Period, the Permitted Investor's Beneficial Ownership (as
defined in the Abbott Rights Agreement) would exceed the Beneficial
Ownership Limitation (as defined in the Abbott Rights Agreement), (the
earlier of (i) and (ii) above being the "Distribution Date"), (x) the
Rights will be evidenced (subject to the provisions of Section 3(b)
hereof) by the certificates for shares of Common Stock registered in
the names of the holders thereof (which certificates shall also be
deemed to be Rights Certificates) and not by separate Rights
Certificates, and (y) the right to receive Rights Certificates will be
transferable only in connection with the transfer of shares of Common
Stock."
5. MISCELLANEOUS. This Amendment shall be deemed to be a contract
made under the laws of the State of Delaware and for all purposes shall be
governed by and construed in accordance with the laws of such State applicable
to contracts to be made and performed entirely within such State. 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. If any term, provision,
covenant or restriction of this Amendment is held by a court of competent
jurisdiction or other authority to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions of this Amendment
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated.
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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: TRIANGLE PHARMACEUTICALS, INC.
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxx Xxxxx
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Name: Xxxxx X. Xxxxxx Name: Xxxxx Xxxxx
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Title: General Counsel Title: Chief Executive Officer
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ATTEST: AMERICAN STOCK TRANSFER & TRUST
COMPANY
By: /s/ Xxxxx X. Xxxxxxxxx By: /s/ Xxxxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxxxxx Name: Xxxxxxx X. Xxxxxx
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Title: Vice President Title: Vice President
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