Exhibit 4.1
AMENDMENT TO RIGHTS AGREEMENT dated March
25, 1998, to the Rights Agreement dated August 6,
1991, as amended (the "Rights Agreement"), by and
between Pharmaceutical Resources, Inc., a New Jersey
corporation ("the "Company"), and First City Transfer
Company (the "Rights Agent").
WHEREAS, the Board of Directors of the Company, on August 6, 1991,
authorized and adopted a share purchase rights plan (the "Plan") to protect the
Company's shareholders against unsolicited and hostile attempts to acquire
control of the Company and, in connection therewith, executed and delivered the
Rights Agreement to effectuate the terms of the Plan;
WHEREAS, the Board of Directors of the Company, on March 25, 1998, approved
and adopted an amendment to the Plan as described herein in contemplation of a
certain negotiated transaction;
WHEREAS, the Board of Directors of the Company authorized and directed the
proper officers of the Company as well as the Rights Agent to execute and
deliver this Amendment to the Rights Agreement in order to effectuate the
foregoing amendments to the Plan; and
WHEREAS, all capitalized terms used herein and not otherwise defined herein
shall have the meanings set forth in the Rights Agreement.
NOW, THEREFORE, in consideration of the mutual premises, the Rights
Agreement is hereby amended as follows:
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Section 1. Effective Dates. (a) The amendment set forth in Section 2(a)
hereof shall be effective upon the execution and delivery of the Stock Purchase
Agreement, dated March 25, 1998, between the Company and Lipha Americas, Inc.
(the "Stock Purchase Agreement").
(b) The amendments set forth in Sections 2(b), (c), (e) and (f) hereof
shall be effective upon the consummation of the Stock Purchase Agreement.
Section 2. Certain Definitions. (a) The definition of "Acquiring Person" as
set forth in the first sentence in Section 1(a) shall be amended by deleting
"or" before "(v)" and inserting in its stead "," and by inserting the following
at the end of the first sentence thereof before the ".":
"and (vi) Lipha Americas, Inc. ("Lipha"), Merck KGaA ("Merck") and
Genpharm, Inc. ("Genpharm") under a stock purchase agreement and options
approved by the Board of Directors of the Company, as amended from time to
time, between the Company and Lipha, Merck and Genpharm, as the case may
be, so long as any acquisition or tender or exchange offer is permitted
under such stock purchase agreement or options"
(b) The definition of "Acquiring Person" as set forth in the first sentence
of Section 1(a) shall be amended by amending clause (v) in its entirety as
follows:
"(v) [intentionally omitted],"
(c) The definition of "Permitted Offer" in Section 1(n) shall be amended in
its entirety as follows:
"(n) "Permitted Offer" shall mean the following tender offers made in the
manner prescribed by Section 14(d) of the Exchange Act and the rules and
regulations promulgated thereunder: (i) a tender offer for all outstanding
Common Shares; provided, however, that such tender offer occurs at a time
when Continuing Directors are in office and a majority of the Continuing
Directors has determined that the offer is fair to, and otherwise in the
best interests of, the Company and
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its stockholders, and (ii) a tender offer for Common Shares as
permitted by a stock purchase agreement approved by the Board of
Directors of the Company, as amended from time to time, between the
Company and Lipha."
(d) The proviso in the definition of "Person" in Section 1(o) shall be
amended in its entirety with the following:
"; provided, however, that "Person" shall exclude Lipha and its associates
and affiliates until such time as any acquisition of or tender offer for
Common Shares by Lipha or any of its affiliates or associates shall not be
permitted under a stock purchase agreement approved by the Board of
Directors of the Company, as amended from time to time, between the Company
and Lipha"
(e) The proviso in the definition of "Section 11(a)(ii)(A) Event" in
Section 1(v) shall be amended in its entirety as follows:
"; provided, however, in no event shall any of the actions described
in Section 11(a)(11)(A) by Lipha or any of its affiliates or
associates constitute a Section 11(a)(ii)(A) Event to the extent that
any such actions shall not be prohibited under a stock purchase
agreement approved by the Board of Directors of the Company, as
amended from time to time, between the Company and Lipha"
(f) The proviso in the definition of "Section 13 Event" in Section 1(w)
shall be amended in its entirety as follows:
"; provided, however, in no event shall any of the actions described
in Section 13(a) by Lipha or any of its affiliates or associates
constitute a Section 13 Event to the extent that any such actions
shall not be prohibited under a stock purchase agreement approved by
the Board of Directors of the Company, as amended from time to time,
between the Company and Lipha"
Section 3. Authority for Amendment. This Amendment is being executed and
delivered as of the date hereof by the Company and the Rights Agent pursuant to
and in accordance with Section 27 of the Rights Agreement. By executing this
Amendment, the Company hereby certifies to the Rights Agent that this Amendment
is in compliance with Section 27 of the Rights Agreement. Except as
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otherwise amended hereby, all the provisions of the Rights Agreement shall
remain in full force and effect. This Amendment shall be deemed to be a part of,
and shall be construed as part of, the Rights Agreement.
IN WITNESS HEREOF, the parties hereby have caused this Amendment to be duly
executed as of the date first above written.
PHARMACEUTICAL RESOURCES, INC.
By /s/ Kenneth I. Sawyer
-----------------------------
Title: President
FIRST CITY TRANSFER COMPANY
By /s/ Kathleen M. Zaleske
-----------------------------
Title: Kathleen M. Zaleske
Assistant Vice President
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