1
EXHIBIT 2
AMENDMENT NO. 1
TO
RIGHTS AGREEMENT
This AMENDMENT NO. 1 (the "Amendment") to the Rights Agreement (the "Rights
Agreement") dated as of December 17, 1996 between IDEXX Laboratories, Inc., a
Delaware corporation (the "Company"), and BankBoston, N.A. (formerly known as
The First National Bank of Boston), a national banking association, as Rights
Agent (the "Rights Agent"), is entered into as of the 22nd day of July, 1999.
Capitalized terms not otherwise defined herein shall have the respective
meanings given to them in the Rights Agreement.
RECITALS
WHEREAS, the Board of Directors has determined that it is in the best
interests of the Company to amend the Rights Agreement as set forth herein.
WHEREAS, the Company has requested that the Rights Agreement be amended in
accordance with Section 27 of the Rights Agreement, as set forth herein, and the
Rights Agent is willing to amend the Rights Agreement as set forth herein.
AGREEMENT
NOW, THEREFORE, the parties, intending to be legally bound, hereby agree as
follows:
1. Sections 1(d)(ii) and 1(d)(iii) of the Rights Agreement are hereby amended
and restated to read in their entirety as follows:
"(ii) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has the right to vote or
dispose of or has "Beneficial Ownership" of (as determined
pursuant to Rule 13d-3 of the General Rules and Regulations under
the Exchange Act, or any comparable or successor rule), including
pursuant to any agreement, arrangement or understanding (other
than customary agreements with and between underwriters and
selling group members with respect to a bona fide public offering
of securities), whether or not in writing; PROVIDED, HOWEVER,
that a Person shall not be deemed the "Beneficial Owner" of, or
to "Beneficially Own," any security under this subparagraph (ii)
as a result of an agreement, arrangement or understanding to vote
such security if such agreement, arrangement or understanding:
(A) arises solely from a revocable proxy or consent given in
response to a public proxy or consent solicitation made pursuant
to, and in accordance with, the applicable provisions of the
General Rules and Regulations under the Exchange Act, and (B) is
not then reportable by such Person on Schedule 13D under the
Exchange Act (or any comparable or successor report); or
2
(iii) which are beneficially owned, directly or indirectly, by any
other Person (or any Affiliate or Associate thereof) with which
such Person (or any of such Person's Affiliates or Associates)
has any agreement, arrangement or understanding (other than
customary agreements with and between underwriters and selling
group members with respect to a bona fide public offering of
securities), whether or not in writing, for the purpose of
acquiring, holding, voting (except pursuant to a revocable proxy
or consent as described in the proviso to subparagraph (ii) of
this paragraph (d)) or disposing of any voting securities of the
Company."
2. Section 1(i) of the Rights Agreement is hereby deleted in its entirety and
replaced with the following:
"(i) [Intentionally omitted.]"
3. Section 1(p) of the Rights Agreement is hereby deleted in its entirety and
replaced with the following:
"(p) [Intentionally omitted.]"
4. The penultimate sentence of Section 3(a) of the Rights Agreement is hereby
amended and restated to read in its entirety as follows:
"In the event that an adjustment in the number of Rights per share of
Common Stock has been made pursuant to Sections 11(i) or 11(p) hereof, at
the time of distribution of the Right Certificates, the Company shall make
the necessary and appropriate rounding adjustments (in accordance with
Section 14(a) hereof) so that Rights Certificates representing only whole
numbers of Rights are distributed and cash is paid in lieu of any
fractional Rights."
5. Section 4(b) of the Rights Agreement is hereby amended and restated to read
in its entirety as follows:
"(b) Any Rights Certificate issued pursuant to Section 3,
Section 11(i) or Section 22 hereof that represents Rights beneficially
owned by persons known to be: (i) an Acquiring Person or any Associate or
Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring Person
(or of any such Associate or Affiliate) who becomes a transferee after the
Acquiring Person becomes such, or (iii) a transferee of an Acquiring Person
(or of any such Associate or Affiliate) who becomes a transferee prior to
or concurrently with the Acquiring Person becoming such and receives such
Rights pursuant to either (A) a transfer (whether or not for consideration)
from the Acquiring Person to holders of equity interests in such Acquiring
Person or to any Person with whom such Acquiring Person has any continuing
agreement, arrangement or understanding regarding the transferred
2
3
Rights or (B) a transfer which the Board of Directors of the Company has
determined is part of a plan, arrangement or understanding that has as a
primary purpose or effect avoidance of Section 7(e) hereof, and any Rights
Certificate issued pursuant to Section 6 or Section 11 hereof upon
transfer, exchange, replacement or adjustment of any other Rights
Certificate referred to in this sentence, shall contain (to the extent
feasible) the following legend:
The Rights represented by this Rights Certificate are or were
beneficially owned by a Person who was or became an Acquiring Person
or an Affiliate or Associate of an Acquiring Person (as such terms are
defined in the Rights Agreement). Accordingly, this Rights Certificate
and the Rights represented hereby may become null and void in the
circumstances specified in Section 7(e) of such Agreement."
6. Section 7(a) of the Rights Agreement is hereby amended and restated to read
in its entirety as follows:
"(a) Subject to Section 7(e) hereof, the registered holder of
any Rights Certificate may exercise the Rights evidenced thereby (except as
otherwise provided herein including, without limitation, the restrictions
on exercisability set forth in Section 9(c), Section 11(a)(iii) and Section
23(a) hereof) in whole or in part at any time after the Distribution Date
upon surrender of the Rights Certificate, with the form of election to
purchase and the certificate on the reverse side thereof duly executed, to
the Rights Agent at the office of the Rights Agent designated for such
purpose, together with payment of the aggregate Purchase Price with respect
to the total number of one one-thousandths of a share (or other shares,
securities, cash or other assets, as the case may be) as to which such
surrendered Rights are then exercisable, at or prior to the earliest of (i)
the Final Expiration Date, (ii) the time at which the Rights are redeemed
as provided in Section 23 hereof (the "Redemption Date") or (iii) the time
at which such Rights are exchanged as provided in Section 24 hereof (the
earliest of (i), (ii) and (iii) being herein referred to as the "Expiration
Date")."
7. Section 11(a)(ii) of the Rights Agreement hereby amended and restated to
read in entirety as follows:
"(ii) Subject to Section 24 of this Agreement, in the event that
any Person, alone or together with its Affiliates or Associates, becomes an
Acquiring Person, then, promptly following the first occurrence of such
event, proper provision shall be made so that each holder of a Right
(except as provided below and in Section 7(e) hereof) shall thereafter have
the right to receive (subject to the last sentence of Section 23(a)), upon
exercise thereof at the then current Purchase Price in accordance with the
terms of this Agreement, in lieu of a number of one one-thousandths of a
share of Preferred Stock, such number of shares of Common Stock of the
Company that equals the result obtained
3
4
by (x) multiplying the then current Purchase Price by the then number of
one one-thousandths of a share of Preferred Stock for which a Right was
exercisable immediately prior to the first occurrence of a Section
11(a)(ii) Event, and (y) dividing that product (which, following such first
occurrence, shall thereafter be referred to as the "Purchase Price" for
each Right and for all purposes of this Agreement) by 50% of the current
market price (determined pursuant to Section 11(d) hereof) per share of
Common Stock on the date of such first occurrence (such number of shares,
the "Adjustment Shares")."
8. The term "certificate of incorporation" in Section 11(a)(iii) is hereby
amended to read: "Certificate of Incorporation".
9. Section 13(a) of the Rights Agreement is hereby amended and restated to
read in its entirety as follows:
"(a) In the event that, at any time after a Person has become an
Acquiring Person, (x) the Company shall consolidate with, or merge with and
into, any other Person (other than a Subsidiary of the Company in a
transaction that complies with Section 11(o) hereof), and the Company shall
not be the continuing or surviving corporation of such consolidation or
merger, (y) any Person (other than a Subsidiary of the Company in a
transaction that complies with Section 11(o) hereof) shall consolidate
with, or merge with or into, the Company, and the Company shall be the
continuing or surviving corporation of such consolidation or merger and, in
connection with such consolidation or merger, all or part of the
outstanding shares of Common Stock shall be changed into or exchanged for
stock or other securities of any other Person or cash or any other property
or (z) the Company shall sell or otherwise transfer (or one or more of its
Subsidiaries shall sell or otherwise transfer), in one transaction or a
series of related transactions, assets or earning power aggregating more
than 50% of the assets or earning power of the Company and its Subsidiaries
(taken as a whole) to any Person or Persons (other than the Company or any
Subsidiary of the Company in one or more transactions each of which
complies with Section 11(o) hereof), then, and in each such case, proper
provision shall be made so that: (i) each holder of a Right, except as
provided in Section 7(e) hereof, shall thereafter have the right to
receive, upon the exercise thereof at the then current Purchase Price in
accordance with the terms of this Agreement, such number of validly
authorized and issued, fully paid, non-assessable and freely tradeable
shares of Common Stock of the Principal Party (as such term is hereinafter
defined), not subject to any liens, encumbrances, rights of first refusal
or other adverse claims, as shall be equal to the result obtained by (1)
multiplying the then current Purchase Price by the number of one
one-thousandths of a share of Preferred Stock for which a Right is
exercisable immediately prior to the first occurrence of a Section 13 Event
(or, if a Section 11(a)(ii) Event has occurred prior to the first
occurrence of a Section 13 Event, multiplying the number of such one
one-thousandths of a share for which a Right was exercisable immediately
prior to the first occurrence of a Section 11(a)(ii) Event by the Purchase
4
5
Price in effect immediately prior to such first occurrence), and (2)
dividing that product (which, following the first occurrence of a Section
13 Event, shall be referred to as the "Purchase Price" for each Right and
for all purposes of this Agreement) by 50% of the current market price
(determined pursuant to Section 11(d)(i) hereof) per share of the Common
Stock of such Principal Party on the date of consummation of such Section
13 Event; (ii) such Principal Party shall thereafter be liable for, and
shall assume, by virtue of such Section 13 Event, all the obligations and
duties of the Company pursuant to this Agreement; (iii) the term "Company"
shall thereafter be deemed to refer to such Principal Party, it being
specifically intended that the provisions of Section 11 hereof shall apply
only to such Principal Party following the first occurrence of a Section 13
Event; (iv) such Principal Party shall take such steps (including, but not
limited to, the reservation of a sufficient number of shares of its Common
Stock) in connection with the consummation of any such transaction as may
be necessary to assure that the provisions hereof shall thereafter be
applicable, as nearly as reasonably may be, in relation to its shares of
Common Stock thereafter deliverable upon the exercise of the Rights; and
(v) the provisions of Section 11(a)(ii) hereof shall be of no effect
following the first occurrence of any Section 13 Event."
10. Section 13(d) of the Rights Agreement is hereby deleted in its entirety.
11. Section 23(a) of the Rights Agreement is hereby amended and restated to
read in its entirety as follows:
"(a) The Board of Directors of the Company may, at its option,
at any time prior to the earlier of (i) the close of business on the tenth
Business Day (or such later date as may be determined by the Board of
Directors of the Company pursuant to clause (i) of the first sentence of
Section 3(a) with respect to the Distribution Date) following the Stock
Acquisition Date (or, if the Stock Acquisition Date shall have occurred
prior to the Record Date, the close of business on the tenth Business Day
following the Record Date) or (ii) the Final Expiration Date, redeem all
but not less than all the then outstanding Rights at a redemption price of
$.01 per Right, as such amount may be 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 redemption of the Rights by the Board 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. Notwithstanding anything
contained in this Agreement to the contrary, the Rights shall not be
exercisable after the first occurrence of a Section 11(a)(ii) Event until
such time as the Company's right of redemption hereunder has expired."
12. Section 23(c) of the Rights Agreement is hereby amended and restated to
read in its entirety as follows:
5
6
"(c) In the event of a redemption of the Rights in accordance
with this Agreement, 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 in accordance with this
Agreement and (ii) mailing payment of the Redemption Price to the
registered holders of the Rights at their last addresses as they appear on
the registry books of the Rights Agent or, prior to the Distribution Date,
on the registry books of the Transfer Agent of the Common Shares, and upon
such action, all outstanding Rights and Right Certificates shall be null
and void without any further action by the Company."
13. The address for notices to or demands on the Rights Agent set forth in
Section 26 of the Rights Agreement is hereby amended to read as follows:
"BankBoston, N.A.
c/o EquiServe Limited Partnership
150 Royall Street
Canton, MA 02021
Attention: Client Administration"
14. Section 27 of the Rights Agreement is hereby amended and restated to read
in its entirety as follows:
"Section 27. SUPPLEMENTS AND AMENDMENTS. Except as provided in
the penultimate sentence of this Section 27, for so long as the Rights are
then redeemable, the Company may, in its sole and absolute discretion, and
the Rights Agent shall, if the Company so directs, supplement or amend any
provision of this Agreement in any respect without the approval of any
holders of the Rights. At any time when the Rights are no longer
redeemable, except as provided in the penultimate sentence of this Section
27, the Company may, and the Rights Agent shall, if the Company so directs,
supplement or amend this Agreement without the approval of any holders of
Rights in order (i) to cure any ambiguity or (ii) to correct or supplement
any provision contained herein which may be defective or inconsistent with
any other provisions herein; PROVIDED, that no such supplement or amendment
shall adversely affect the interests of the holders of Rights as such
(other than an Acquiring Person or an Affiliate or Associate of an
Acquiring Person). 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 27, the Rights
Agent shall execute such supplement or amendment. Notwithstanding anything
contained in this Agreement to the contrary, no supplement or amendment
shall be made which changes the Redemption Price or the Final Expiration
Date. Prior to the Distribution Date, the interests of the holders of
Rights shall be deemed coincident with the interests of the holders of
Common Stock."
6
7
15. Section 31 of the Rights Agreement is hereby amended and restated to read
in its entirety as follows:
"Section 31. SEVERABILITY. If any term, provision, covenant or
restriction of this Agreement 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 Agreement shall
remain in full force and effect and shall in no way be affected, impaired
or invalidated; provided, however, that notwithstanding anything in this
Agreement to the contrary, if any such term, provision, covenant or
restriction is held by such court or authority to be invalid, void or
unenforceable and the Board determines in its good faith judgment that
severing the invalid, void or unenforceable language from this Agreement
would adversely affect the purpose or effect of this Agreement, the right
of redemption set forth in Section 23 hereof shall be reinstated and shall
not expire until the close of business on the tenth day following the date
of such determination by the Board of Directors of the Company."
16. Except as amended hereby, the Rights Agreement shall remain unchanged and
shall remain in full force and effect.
17. This Amendment may be executed in any number of counterparts, each of which
shall be an original, but all of which together shall constitute one
instrument.
IN WITNESS WHEREOF, the parties have caused this Amendment to be executed
by their respective duly authorized representatives as of the date first above
written.
IDEXX LABORATORIES, INC.
By: /s/ David E. Shaw
------------------------------
Name: David E. Shaw
Title: President and Chief
Executive Officer
BANKBOSTON, N.A.
By: /s/ Katherine Anderson
------------------------------
Name: Katherine Anderson
Title: Managing Director
7