Exhibit 4.2
AMENDMENT TO RIGHTS AGREEMENT dated September 30, 1997, 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 Agreement"), as
successor to Midlantic Bank.
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 Plan was amended, on March 23, 1995, in contemplation of a
certain negotiated transaction with Clal Pharmaceutical Industries Ltd.;
WHEREAS, the Board of Directors of the Company, on July 28, 1997, approved
an amendment to the Plan as described herein in contemplation of modifications
to such 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 premises, the Rights Agreement is
hereby amended as follows:
Section (C) Certain Definitions. Section 1(a)(v) of the Rights Agreement
shall be amended in its entirety as follows:
"(v) Clal Pharmaceutical Industries Ltd. and its permitted assigns
under Section 16 of the Stock Purchase Agreement, dated March 25, 1995,
between the Company and Clal Pharmaceutical Industries Ltd., as amended
(the "Stock Purchase Agreement") (Clal Pharmaceutical Industries Ltd.
and its permitted assigns under such Section 16 shall be collectively
referred to herein as "Clal"), so long as any acquisition or tender
offer by Clal is permitted under the Stock Purchase Agreement"
(A) The definition of "Permitted Offer" in Section 1(n) of the Rights
Agreement 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
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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 its stockholders, and (ii) a tender offer
for Common Shares as permitted by the Stock Purchase Agreement."
(B) The proviso in the definition of "Section 11(a)(ii)(A) Event" in
Section 1(v) of the Rights Agreement shall be amended in its entirety as
follows:
"; provided, however, in no event shall an acquisition of or tender
offer for Common Shares by Clal constitute a Section 11(a)(ii)(A) Event
until such time as any such acquisition or tender offer by Clal shall
no longer be permitted under the Stock Purchase Agreement"
(C) The proviso in the definition of "Section 13 Event" in Section 1(w) of
the Rights Agreement shall be amended in its entirety as follows:
"; provided, however, in no event shall an acquisition of or tender
offer for Common shares by Clal constitute a Section 13 Event until
such time as any such acquisition or tender offer by Clal shall no
longer be permitted under the Stock Purchase Agreement"
Section (D) 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 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.
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IN WITNESS WHEREOF, 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
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Title: President
FIRST CITY TRANSFER COMPANY
By: /s/ Kathleen M. Zaleske
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Title: Assistant Vice President
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