<PAGE> 1
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM S-8
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
Pharmacia & Upjohn, Inc.
(Exact Name of Registrant as Specified in Its Charter)
Delaware
(State or Other Jurisdiction of Incorporation or Organization)
98-0155411
(I.R.S. Employer Identification No.)
Knyvett House, The Causeway, Staines, Middlesex TW18 3BA, England
(Address of Principal Executive Offices) (Zip Code)
Pharmacia & Upjohn, Inc. Long-Term Incentive Plan
(Full Title of Plan)
Kenneth M. Cyrus
Knyvett House
The Causeway
Staines, Middlesex TW18 3BA, England
(Name and Address of Agent For Service)
011 (44-123) 953-1133
Telephone Number, Including Area Code, of Agent For Service.
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Title of Securities to be Amount to be Proposed Offering Proposed Aggregate Amount of
Registered Registered Price Per Share(1) Offering Price(1) Registration Fee
<S> <C> <C> <C> <C>
Common Stock, par value $.01
per share 5,000,000 $38.125 $190,625,000 $65,732.76
<FN>
(1) Estimated pursuant to Rule 457(h)(1), and is being utilized solely
for the purpose of calculating the registration fee, based on the
average of the high and low prices of the Pharmacia & Upjohn, Inc.,
Common Stock, par value $.01 per share on the New York Stock Exchange
Composite Tape on April 29, 1996.
</TABLE>
<PAGE>
<PAGE> 2
PART I
INFORMATION REQUIRED IN THE PROSPECTUS
Item 1. Plan Information
All information required by Part I to be contained in the
Section 10(a) prospectus is omitted from this Registration Statement in
accordance with Rule 428 under the Securities Act of 1933, as amended (the
"Securities Act"), and the Note to Part I of Form S-8.
Item 2. Registrant Information and Employee Plan Annual
Information
All information required by Part I to be contained in the
Section 10(a) prospectus is omitted from this Registration Statement in
accordance with Rule 428 under the Securities Act and the Note to Part I of
Form S-8.
<PAGE>
<PAGE> 3
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The documents listed on (a) through (c) below are incorporated
herein by reference.
(a) Pharmacia & Upjohn, Inc.'s (the "Registrant") Annual
Report on Form 10-K (the "10-K") for the year ended December 31, 1995,
filed with the Securities and Exchange Commission (the "Commission") on
March 29, 1996 and the Registrant's Amendment to the 10-K on Form 10-K/A,
filed with the Commission on April 1, 1996.
(b) None.
(c) The description of the Registrant's Common Stock, par
value $.01 per share (the "Common Stock"), contained in the Registrant's
Registration Statement on Form 8-A (File No. 1-11557) filed with the
Commission on October 24, 1995.
All documents subsequently filed by the Registrant pursuant to
Section 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934,
as amended, prior to the filing of a post-effective amendment which
indicates that all securities offered have been sold or which deregisters
all securities then remaining unsold, shall be deemed to be incorporated by
reference in this Registration Statement and to be part thereof from the
date of filing of such documents.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not Applicable.
Item 6. Indemnification of Officers and Directors.
Section 145 of the Delaware General Corporation Law authorizes
a court to award, or a corporation's board of directors to grant, indemnity
to directors and officers in terms sufficiently broad to permit such
indemnification under certain circumstances for liabilities (including
reimbursement for expenses incurred) arising under the Securities Act of
1933. The Registrant's Certificate of Incorporation and By-
<PAGE>
<PAGE> 4
laws provide for indemnification of its directors, officers, employees and
other agents to the maximum extent permitted by the Delaware General
Corporation Law. In addition, the Registrant has entered into
indemnification agreements with its executive officers and directors. The
Registrant also has purchased and maintains insurance for its officers,
directors, employees or agents against liabilities which an officer, a
director, an employee or an agent may incur in his capacity as such.
For a period of six years following November 2, 1995, the
Registrant has agreed to cause to be maintained in effect the directors'
and officers' liability insurance policies maintained by The Upjohn Company
("Upjohn") and Pharmacia Aktiebolag ("Pharmacia") (provided that the
Registrant may, and in the event of the cancellation or termination of such
policies, the Registrant will, substitute therefor policies reasonably
satisfactory to the indemnified parties of at least the same coverage
containing terms and conditions which are no less advantageous) with
respect to claims arising from facts or events that occurred prior to
November 2, 1995.
The Registrant has agreed to indemnify and hold harmless each
former director and officer of Upjohn or Pharmacia, determined as of
November 2, 1995, against any Costs (as defined in the Combination
Agreement, dated August 20, 1995 among Pharmacia, Upjohn, the Registrant
and Pharmacia & Upjohn Subsidiary, Inc. (the "Combination Agreement"))
incurred in connection with any claim, action, suit, proceeding or
investigation, whether civil, criminal, administrative or investigative,
arising out of or pertaining to matters existing or occurring at or prior
to November 2, 1995, whether asserted or claimed prior to, at or after
November 2, 1995, to the fullest extent that Upjohn or Pharmacia would have
been permitted under Delaware or Swedish law, as the case may be, and their
charter documents (each as in effect on August 20, 1995) to indemnify such
indemnified parties (and the Registrant has also agreed to advance expenses
as incurred to the fullest extent permitted under applicable law, provided
that such indemnified party to whom expenses are advanced provides an
undertaking to repay such advances if it is ultimately determined that such
indemnified party is not entitled to indemnification); and provided,
further, that any determination required to be made with respect to whether
an officer's or director's conduct complies with the standards set forth
under Delaware (Upjohn's jurisdiction of incorporation) or Swedish law
(Pharmacia's jurisdiction of incorporation) and Upjohn's or Pharmacia's
charter documents will be made by independent counsel selected by the
Registrant.
To the extent the foregoing provisions do not serve to
indemnify and hold harmless an Indemnified Party (as defined in the
Combination Agreement), for a period of six years after the date of the
Combination Agreement, the Combination Agreement provides that the
Registrant will, subject to the terms set forth in the Combination
Agreement, indemnify and hold harmless, to the fullest extent permitted
under applicable law (and the Registrant will also advance expenses as
incurred to the fullest extent permitted under applicable law; provided
that the Indemnified Party to whom expenses
<PAGE>
<PAGE> 5
are advanced provides an undertaking to repay such advances if it is
ultimately determined that such Indemnified Party is not entitled to
indemnification), each Indemnified Party against any Costs incurred in
connection with any claim, action, suit, proceeding or investigation,
whether civil, criminal, administrative or investigative, arising out of or
pertaining to the transactions contemplated by the Combination Agreement;
provided, however, that the Registrant will not be required to indemnify
any Indemnified Party if it is determined that the Indemnified Party acted
in bad faith and not in a manner such Indemnified Party believed to be in
or not opposed to the best interests of Upjohn or Pharmacia, as the case
may be.
Item 7. Exemption from Registration Claim.
Not Applicable.
Item 8. Exhibits.
The following exhibits are filed as part of this Registration
Statement:
Exhibit No. Description
4.1 Restated Certificate of Incorporation of the Registrant.
4.2 By-laws of the Registrant.
4.3 Specimen Common Stock Certificate (incorporated by
reference to Exhibit 5 to the Registrant's Registration
Statement on Form 8-A (File No. 1-11557)).
4.4 Pharmacia & Upjohn, Inc. Long-Term Incentive Plan
(incorporated by reference to Exhibit 10(g) to the
Registrant's Form 10-K for 1995 (File No. 1-11557)).
5 Opinion of Sullivan & Cromwell as to the validity of the
Common Stock.
23.1 Consent of Sullivan & Cromwell (contained in Exhibit 5.1
attached hereto).
23.2 Consent of Coopers & Lybrand, L.L.P. and KPMG Peat
Marwick, LLP.
<PAGE>
<PAGE> 6
Item 9. Undertakings
(a) The Registrant hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this registration statement
to include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement;
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof; and
(3) To remove from registration by means of a post-
effective amendment any of the securities being registered which remain
unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933,
each filing of the Registrant's annual report pursuant to Section 13(a) or
Section 15(d) of the Securities Exchange Act of 1934 that is incorporated
by reference in the Registration Statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under
the Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing provision,
or otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities
(other than the payment by the Registrant of expenses incurred or paid by a
director, officer or controlling person of the Registrant in the successful
defense of any action, suit or proceeding) is asserted by such director,
officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will be
governed by the final adjudication of such issue.
<PAGE>
<PAGE> 7
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly caused
this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the city of Kalamazoo, State of Michigan, on
this 1st day of April, 1996.
PHARMACIA & UPJOHN, INC.
By: /s/ John L. Zariskie
John L. Zabriskie
President and Chief Executive
Officer and Director
Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed by the following
persons in the indicated capacities on April 1, 1996.
Signature Title
/s/ Jan Ekberg Chairman of the Board and
Jan Ekberg Director
/s/ John L. Zabriskie President and Chief Executive
John L. Zabriskie Officer
Executive Vice President, Chief
/s/ Robert C. Salisbury Financial Officer and Chief
Robert C. Salisbury Accounting Officer
/s/ Richard H. Brown
Richard H. Brown Director
/s/ Frank C. Carlucci
Frank C. Carlucci Director
Signature Title
<PAGE>
<PAGE> 8
/s/ Gustaf Douglas
Gustaf Douglas Director
/s/ M. Kathryn Eickhoff
M. Kathryn Eickhoff Director
/s/ Daryl F. Grisham
Daryl F. Grisham Director
/s/ Soren Gyll
Soren Gyll Director
/s/ William E. LaMothe
William E. LaMothe Director
/s/ Goran Linden
Goran Linden Director
/s/ Berthold Lindquist
Berthold Lindquist Director
/s/ Olof Lund
Olof Lund Director
/s/ William D. Mulholland
William D. Mulholland Director
/s/ William U. Parfet
William U. Parfet Director
/s/ Ulla Reinius
Ulla Reinius Director
/s/ Bengt Samuelsson
Bengt Samuelsson Director
<PAGE> 1
Exhibit 4.1
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF PHARMACIA & UPJOHN, INC.
Pharmacia & Upjohn, Inc., a Delaware corporation (the
"Corporation"), hereby certifies as follows:
(1) The name of the corporation is Pharmacia & Upjohn, Inc.
The date of filing of its original certificate of incorporation with the
Secretary of State was August 17, 1995 under the name Bushwood, Inc.
(2) This restated certificate of incorporation amends,
restates and integrates the provisions of the certificate of incorporation
of said corporation and has been duly adopted in accordance with the
provisions of Section 245 of the General Corporation Law of the State of
Delaware.
(3) The text of the certificate of incorporation is hereby
amended, restated and integrated to read as set forth in full:
ARTICLE I
Name
The name of the corporation is Pharmacia & Upjohn, Inc.
ARTICLE II
Registered Office and Registered Agent
The address of the registered office of the Corporation in the
State of Delaware is Corporation Trust Center, 1209 Orange Street, in the
City of Wilmington, County of New Castle. The name of the registered agent
of the Corporation at such address is The Corporation Trust Company.
<PAGE>
<PAGE> 2
ARTICLE III
Corporate Purpose
The purpose of the Corporation is to engage in any lawful act
or activity for which corporations may now or hereafter be organized, and
it shall have all powers which may now or hereafter be lawful for a
corporation to exercise under the General Corporation Law of the State of
Delaware (the "General Corporation Law").
ARTICLE IV
Capital Stock
The total number of shares of all classes of stock that the
Corporation shall have authority to issue is One Billion Six Hundred
Million (1,600,000,000), of which One Billion Five Hundred Million
(1,500,000,000) shares shall be shares of Common Stock, par value $0.01
per share ("Common Stock"), and One Hundred Million (100,000,000) shares
shall be shares of Preferred Stock, par value $0.01 per share ("Preferred
Stock"), of which 7,500 shares shall be designated Series A Convertible
Perpetual Preferred Stock.
A.1 Preferred Stock
The Preferred Stock may be issued from time to time by the
Board of Directors of the Corporation (the "Board") as shares of one or
more series. Subject to the provisions hereof and the limitations
prescribed by law, the Board is expressly authorized, prior to issuance, by
adopting resolutions providing for the issuance of, or providing for a
change in the number of, shares of any particular series and, if and to the
extent from time to time required by law, by filing a certificate pursuant
to the General Corporation Law (or other law hereafter in effect relating
to the same or substantially similar subject matter), to establish or
change the number of shares to be included in each such series and to fix
the designation and relative powers, preferences and rights and the
qualifications and limitations or restrictions thereof relating to the
shares of each such series. The authority of the Board with respect to each
series shall include, but not be limited to, determination of the
following:
(i) the distinctive serial designation of such series and the
number of shares constituting such series;
<PAGE>
<PAGE> 3
(ii) the dividend rate, or basis for determining such rate, if
any, on shares of such series, whether dividends shall be cumulative
and, if so, from which date or dates;
(iii) whether the shares of such series shall be redeemable
(which, if so redeemable, may be redeemed in whole or in part) and, if
so, terms and conditions of such redemption, including the date or
dates upon and after which such shares shall be redeemable, and the
amount per share payable in case of redemption, which amount may vary
under different conditions and at different redemption dates;
(iv) the obligation, if any, of the Corporation to purchase or
redeem shares of such series pursuant to a sinking fund or otherwise
and the price or prices at which, the period or periods within which
and the terms and conditions upon which the shares of such series
shall be redeemed or purchased;
(v) whether shares of such series shall be convertible into,
or exchangeable for, shares of stock of any other class or classes
and, if so, the terms and conditions of such conversion or exchange,
including the price or prices or the rate or rates of conversion or
exchange, the terms of adjustment, if any, and whether such shares
shall be convertible or exchangeable at the option of the Corporation,
the holders or both;
(vi) whether the shares of such series shall have voting
rights, in addition to the voting rights provided by law, and, if so,
the terms of such voting rights;
(vii) the rights of the shares of such series in the event of
voluntary or involuntary liquidation, dissolution or winding up of the
Corporation; and
(viii) any other relative rights, powers, preferences,
qualification, limitations or restrictions thereof relating to such
series.
The shares of Preferred Stock of any one series shall be
identical with each other in all respects except as to the dates from and
after which dividends thereon shall cumulate, if cumulative.
The number of authorized shares of Preferred Stock may be
increased or decreased by the affirmative vote of the holders of a majority
of the stock of the Corporation entitled to vote without the separate vote
of holders of Preferred Stock as a class.
Without limiting any of the foregoing, there is hereby
authorized to be issued Series A Convertible Perpetual Preferred Stock
("Series A Convertible Perpetual
<PAGE>
<PAGE> 4
Preferred Stock") with the following designations, powers, preferences,
rights, qualifications, limitations and restrictions:
A.2 Series A Convertible Perpetual Preferred Stock
(1) Designation and Amount; Special Purpose Restricted
Transfer Issue. (a) The shares of such series shall be designated as
shares of "Series A Convertible Perpetual Preferred Stock, par value $0.01
per share" (the "Convertible Perpetual Preferred Shares"), and the number
of shares constituting such series shall be 7,500. Each Convertible
Perpetual Preferred Share shall have a stated value of $40,300.00 per
share.
(b) Convertible Perpetual Preferred Shares shall be issued
only to State Street Bank and Trust Company, its successors and assigns, as
trustee (the "Trustee") of the Corporation Employee Stock Ownership Trust
forming a part of the Corporation Employee Stock Ownership Plan, or any
successor to such plan (the "Plan" or "ESOP"). All references to the holder
of Convertible Perpetual Preferred Shares shall mean the Trustee or any
company with which or into which the Trustee may merge or any successor
trustee under the trust agreement with respect to the Plan. In the event of
any transfer of record ownership of Convertible Perpetual Preferred Shares
to any person other than any successor trustee under the Plan, the
Convertible Perpetual Preferred Shares so transferred, upon such transfer
and without any further action by the Corporation or the holder thereof,
shall be automatically converted into shares of Common Stock on the terms
otherwise provided for the conversion of Convertible Perpetual Preferred
Shares into shares of Common Stock pursuant to paragraph (5) of this
Article IV.A.2 and no such transferee shall have any of the voting powers,
preferences and relative, participating, optional or special rights
ascribed to Convertible Perpetual Preferred Shares hereunder but, rather,
only the powers and rights pertaining to the Common Stock into which such
Convertible Perpetual Preferred Shares shall be so converted. In the event
of such a conversion, the transferee of the convertible Perpetual Preferred
Shares shall be treated for all purposes as the record holder of the shares
of Common Stock into which such Convertible Perpetual Preferred Shares have
been automatically converted as of the date of such transfer. Certificates
representing Convertible Perpetual Preferred Shares shall bear a legend to
reflect the foregoing provisions. Notwithstanding the foregoing provisions
of this paragraph (1)(b), Convertible Perpetual Preferred Shares (i) may be
converted into shares of Common Stock as provided by paragraph (5) of this
Article IV.A.2 and the shares of Common Stock issued upon such conversion
may be transferred by the holder thereof as permitted by law and (ii) shall
be redeemable by the Corporation upon the terms and conditions provided by
paragraphs (6), (7) and (8) of this Article IV.A.2.
<PAGE>
<PAGE> 5
(2) Dividends and Distributions. (a) Subject to the
provisions for adjustment hereinafter set forth, the holders of Convertible
Perpetual Preferred Shares shall be entitled to receive, when, as and if
declared by the Board of Directors out of funds legally available therefor,
cash dividends ("Convertible Perpetual Preferred Dividends") in an amount
per share not to exceed $2,518.75 per share per annum, payable quarterly in
arrears, one-quarter on the 1st day of January, one-quarter on the 1st day
of April, one-quarter on the 1st day of July and one-quarter on the 1st day
of October of each year (each a "Dividend Payment Date") commencing on
January 1, 1996, to holders of record at the start of business on such
Dividend Payment Date. In the event that any Dividend Payment Date shall
fall on any day other than a "Business Day" (as hereinafter defined), the
dividend payment due on such Dividend Payment Date shall be paid on the
Business Day immediately following such Dividend Payment Date. Convertible
Perpetual Preferred Dividends shall begin to accrue on outstanding
Convertible Perpetual Preferred Shares from the date of issuance of such
Convertible Perpetual Preferred Shares. Convertible Perpetual Preferred
Dividends shall accrue on a daily basis whether or not the Corporation
shall have earnings or surplus at the time, but Convertible Perpetual
Preferred Dividends accrued after issuance on the Convertible Perpetual
Preferred Shares for any period less than a full quarterly period between
Dividend Payment Dates (or, in the case of the first dividend payment, from
the date of issuance through the first Dividend Payment Date) shall be
computed on the basis of a 360-day year of twelve 30-day months. Accrued
but unpaid Convertible Perpetual Preferred Dividends shall cumulate as of
the Dividend Payment Date on which they first become payable, but no
interest shall accrue on accumulated but unpaid Convertible Perpetual
Preferred Dividends.
(b) So long as any Convertible Perpetual Preferred Shares
shall be outstanding, no dividend shall be declared or paid or set apart
for payment on any other series of stock ranking on a parity with the
Convertible Perpetual Preferred Shares as to dividends, unless there shall
also be or have been declared and paid or set apart for payment on the
Convertible Perpetual Preferred Shares dividends for all dividend payment
periods of the Convertible Perpetual Preferred Shares ending on or before
the dividend payment date of such parity stock, ratably in proportion to
the respective amounts of dividends accumulated and unpaid through such
dividend period on the Convertible Perpetual Preferred Shares and
accumulated and unpaid on such parity stock through the dividend payment
period on such parity stock next preceding such dividend payment date. In
the event that full cumulative dividends on the Convertible Perpetual
Preferred Shares have not been declared and paid or set apart for payment
when due, the Corporation shall not declare or pay or set apart for payment
any dividends or make any other distributions on, or make any payment on
account of the purchase, redemption or other retirement of any other class
of stock or series thereof of the Corporation ranking, as to dividends or
as to distributions in the event of a liquidation, dissolution or winding-
up of the Corporation, junior to the Convertible Perpetual Preferred Shares
until full cumulative dividends on the Convertible Perpetual Preferred
Shares shall have been paid
<PAGE>
<PAGE> 6
or declared and set apart for payment; provided, however, that the
foregoing shall not apply to (i) any dividend payable solely in any shares
of any stock ranking, as to dividends and as to distributions in the event
of a liquidation, dissolution or winding-up of the Corporation, junior to
the Convertible Perpetual Preferred Shares or (ii) the acquisition of
shares of any stock ranking, as to dividends or as to distributions in the
event of a liquidation, dissolution or winding-up of the Corporation,
junior to the Convertible Perpetual Preferred Shares in exchange solely for
shares of any other stock ranking, as to dividends and as to distributions
in the event of a liquidation, dissolution or winding-up of the
Corporation, junior to the Convertible Perpetual Preferred Shares.
(3) Voting Rights. The holders of Convertible Perpetual
Preferred Shares shall have the following voting rights:
(a) The holders of Convertible Perpetual Preferred Shares
shall be entitled to vote on all matters submitted to a vote of the
stockholders of the Corporation, voting together with the holders of
Common Stock as one class. The holder of each Convertible Perpetual
Preferred Share shall be entitled to a number of votes equal to the
number of shares of Common Stock into which such Convertible Perpetual
Preferred Share could be converted on the record date for determining
the stockholders entitled to vote, rounded to the nearest one one-
hundredth of a vote; it being understood that whenever the "Conversion
Price" (as defined in paragraph (5) of this Article IV.A.2.) is
adjusted as provided in paragraph (9) of this Article IV.A.2, the
number of votes of the Convertible Perpetual Preferred Shares shall
also be similarly adjusted.
(b) Except as otherwise required by law or set forth herein,
holders of Convertible Perpetual Preferred Shares shall have no
special voting rights and their consent shall not be required (except
to the extent they are entitled to vote with holders of Common Stock
as set forth herein) for the taking of any corporate action; provided,
however, that the vote of at least 66-2/3% of the outstanding
Convertible Perpetual Preferred Shares, voting separately as a series,
shall be necessary to adopt any alteration, amendment or repeal of any
provision of the Restated Certificate of Incorporation of the
Corporation (including any such alteration, amendment or repeal
effected by any merger or consolidation in which the Corporation is
the surviving or resulting corporation), if such amendment, alteration
or repeal would alter or change the powers, preferences, or special
rights of the Convertible Perpetual Preferred Shares so as to affect
them adversely.
(4) Liquidation, Dissolution or Winding-Up. (a) Upon any
voluntary or involuntary liquidation, dissolution or winding-up of the
Corporation, the holders of Convertible Perpetual Preferred Shares shall be
entitled to receive out of assets of the Corporation that remain after
satisfaction in full of all valid claims of creditors of the Corporation
and that are available for payment to stockholders, and subject to the
rights
<PAGE>
<PAGE> 7
of the holders of any stock of the Corporation ranking senior to or on a
parity with the Convertible Perpetual Preferred Shares in respect of
distributions upon liquidation, dissolution or winding-up of the
Corporation, before any amount shall be paid or distributed among the
holders of Common Stock or any other shares ranking junior to the
Convertible Perpetual Preferred Shares in respect of distributions upon
liquidation, dissolution or winding-up of the Corporation, liquidating
distributions in the amount of $40,300.00 per share, plus an amount equal
to all accrued and unpaid dividends thereon to the date fixed for
distribution, and no more. If upon any liquidation, dissolution or winding-
up of the Corporation, the amounts payable with respect to the Convertible
Perpetual Preferred Shares and any other stock ranking as to any such
distribution on a parity with the Convertible Perpetual Preferred Shares
are not paid in full, the holders of the Convertible Perpetual Preferred
Shares and such other stock shall share ratably in any distribution of
assets in proportion to the full respective preferential amounts to which
they are entitled. After payment of the full amounts to which they are
entitled as provided by the foregoing provisions of this paragraph (4)(a),
the holders of Convertible Perpetual Preferred Shares shall not be entitled
to any further right or claim to any of the remaining assets of the
Corporation.
(b) Written notice of any voluntary or involuntary
liquidation, dissolution or winding-up of the Corporation, stating the
payment date or dates when, and the place or places where, the amounts
distributable to holders of Convertible Perpetual Preferred Shares in such
circumstances shall be payable, shall be given by hand delivery, by
courier, by standard form of telecommunication or by first-class mail
(postage prepaid), delivered, sent or mailed, as the case may be, not less
than 20 days prior to any payment date stated therein, to the holders of
Convertible Perpetual Preferred Shares, at the address shown on the books
of the Corporation or any transfer agent for the Convertible Perpetual
Preferred Shares.
(5) Conversion into Common Stock. (a) A holder of shares of
Convertible Perpetual Preferred Shares shall be entitled, at any time prior
to the close of business on the date fixed for redemption of such shares
pursuant to paragraphs (6), (7) and (8) of this Article IV.A.2., to cause
any or all of such shares to be converted into shares of Common Stock,
initially at a conversion price equal to $27.79 per share of Common Stock,
with each Convertible Perpetual Preferred Share being valued at $43,000.00
for such purpose, and which price shall be adjusted as hereinafter provided
(and, as so adjusted, is hereinafter sometimes referred to as the
"Conversion Price") (that is, a conversion rate initially equivalent to
1,450 shares of Common Stock for each Convertible Perpetual Preferred Share
so converted, which is subject to adjustment as the Conversion Price is
adjusted as hereinafter provided in paragraph (9) of this Article IV.A.2.);
provided, however, that in no event shall the Conversion Price be less than
$1.00.
<PAGE>
<PAGE> 8
(b) Any holder of Convertible Perpetual Preferred Shares
desiring to convert such shares into shares of Common Stock shall surrender
the certificate or certificates representing the Convertible Perpetual
Preferred Shares being converted, duly assigned or endorsed for transfer to
the Corporation (or accompanied by duly executed stock powers relating
thereto), at the principal executive office of the Corporation or the
offices of the transfer agent for the Convertible Perpetual Preferred
Shares or such office or offices in the continental United States of an
agent for conversion as may from time to time be designated by notice to
the holders of the Convertible Perpetual Preferred Shares by the
Corporation or the transfer agent for the Convertible Perpetual Preferred
Shares, accompanied by written notice of conversion. Such notice of
conversion shall specify (i) the number of shares of Convertible Perpetual
Preferred Shares to be converted and the name or names in which such holder
wishes the certificate or certificates for Common Stock and for any
Convertible Perpetual Preferred Shares not to be so converted to be issued
and (ii) the address to which such holder wishes delivery to be made of
such new certificates to be issued upon such conversion.
(c) Upon surrender of a certificate representing a
Convertible Perpetual Preferred Share or Shares for conversion, the
Corporation shall issue and send by hand delivery, by courier or by first-
class mail (postage prepaid) to the holder thereof or to such holder's
designee, at the address designated by such holder, a certificate or
certificates for the number of shares of Common Stock to which such holder
shall be entitled upon conversion. In the event that there shall have been
surrendered a certificate or certificates representing Convertible
Perpetual Preferred Shares, only part of which are to be converted, the
Corporation shall issue and send to such holder or such holder's designee,
in the manner set forth in the preceding sentence, a new certificate or
certificates representing the number of Convertible Perpetual Preferred
Shares which shall not have been converted.
(d) The issuance by the Corporation of shares of Common Stock
upon a conversion of Convertible Perpetual Preferred Shares into shares of
Common Stock made at the option of the holder thereof shall be effective as
of the earlier of (i) the delivery to such holder or such holder's designee
of the certificates representing the shares of Common Stock issued upon
conversion thereof or (ii) the commencement of business on the second
Business Day after the surrender of the certificate or certificates for the
Convertible Perpetual Preferred Shares to be converted, duly assigned or
endorsed for transfer to the Corporation (or accompanied by duly executed
stock powers relating thereto) and accompanied by all documentation
required to effect the conversion, as provided by this Article IV.A.2. On
and after the effective date of conversion, the person or persons entitled
to receive the Common Stock issuable upon such conversion shall be treated
for all purposes as the record holder or holders of such shares of Common
Stock, but no allowance or adjustments shall be made in respect of
dividends payable to holders of Common Stock in respect of any period prior
to such effective date. The Corporation shall not be obligated to pay any
dividends that shall have been
<PAGE>
<PAGE> 9
declared and shall be payable to holders of Convertible Perpetual Preferred
Shares on a Dividend Payment Date if the record date for such dividend is
subsequent to the effective date of conversion of such shares.
(e) The Corporation shall not be obligated to deliver to
holders of Convertible Perpetual Preferred Shares any fractional share of
Common Stock issuable upon any conversion of such Convertible Perpetual
Preferred Shares, but in lieu thereof may make a cash payment in respect
thereof in any manner permitted by law.
(f) The Corporation shall at all times reserve and keep
available out of its authorized and unissued Common Stock, solely for
issuance upon the conversion of Convertible Perpetual Preferred Shares as
herein provided, free from any preemptive rights, such number of shares of
Common Stock as shall from time to time be issuable upon the conversion of
all the Convertible Perpetual Preferred Shares then outstanding. Nothing
contained herein shall preclude the Corporation from issuing shares of
Common Stock held in its treasury upon the conversion of Convertible
Perpetual Preferred Shares into Common Stock pursuant to the terms hereof.
The Corporation shall prepare and shall use its best effort to obtain and
keep in force such governmental or regulatory permits or other
authorizations as may be required by law, and shall comply with all
requirements as to registration or qualification of the Common Stock, in
order to enable the Corporation lawfully to issue and deliver to each
holder of record of Convertible Perpetual Preferred Shares such number of
shares of its Common Stock as from time to time is sufficient to effect the
conversion of all Convertible Perpetual Preferred Shares then outstanding
and convertible into shares of Common Stock.
(6) Redemption At the Option of the Corporation. (a) The
Convertible Perpetual Preferred Shares shall be redeemable, in whole or in
part, at the option of the Corporation at any time after July 20, 1999, or
at any time after the date of issuance, if permitted by paragraph (6)(d) of
this Article IV.A.2, at the following redemption prices per share:
<TABLE>
<CAPTION>
During the Twelve-Month
Period Beginning July 20, Price Per Share
<C> <C>
1995 . . . . . . . . . . . . . . . . . . . . . $41,307.500
1996 . . . . . . . . . . . . . . . . . . . . . 41,055.625
1997 . . . . . . . . . . . . . . . . . . . . . 40,803.750
1998 . . . . . . . . . . . . . . . . . . . . . 40,551.875
</TABLE>
<PAGE>
<PAGE> 10
and thereafter at $40,300.00 per share, plus, in each case, an amount equal
to all accrued and unpaid dividends thereon to the date fixed for
redemption. Payment of the redemption price shall be made by the
Corporation in cash or shares of Common Stock, or a combination thereof, as
permitted by paragraph (6)(e) of this Article IV.A.2. From and after the
date fixed for redemption, dividends on Convertible Perpetual Preferred
Shares called for redemption will cease to accrue, such Convertible
Perpetual Preferred Shares will no longer be deemed to be outstanding and
all rights in respect of such Convertible Perpetual Preferred Shares shall
cease, except the right to receive the redemption price. If fewer than all
of the outstanding Convertible Perpetual Preferred Shares are to be
redeemed, the Corporation shall redeem a portion of the Convertible
Perpetual Preferred Shares of each holder determined pro rata based on the
number of Convertible Perpetual Preferred Shares held by each holder.
(b) Unless otherwise required by law, notice of redemption
will be sent to the holders of Convertible Perpetual Preferred Shares at
the address shown on the books of the Corporation or any transfer agent for
the Convertible Perpetual Preferred Shares by hand delivery, by courier, by
standard form of telecommunication or by first-class mail (postage prepaid)
delivered, sent or mailed, as the case may be, not less than twenty (20)
days nor more than sixty (60) days prior to the redemption date. Each such
notice shall state: (i) the redemption date; (ii) the total number of
Convertible Perpetual Preferred Shares to be redeemed and, if fewer than
all the shares held by such holder are to be redeemed, the number of such
Convertible Perpetual Preferred Shares to be redeemed from such holder;
(iii) the redemption price; (iv) whether the redemption price shall be paid
in cash or in shares of Common Stock, or in a combination of such Common
Stock and cash, as permitted by paragraph (6)(e) of this Article IV.A.2;
(v) the place or places where certificates for such Convertible Perpetual
Preferred Shares are to be surrendered for payment of the redemption price;
(vi) that dividends on the Convertible Perpetual Preferred Shares to be
redeemed will cease to accrue on such redemption date; and (vii) the
conversion rights of the Convertible Perpetual Preferred Shares to be
redeemed, the period within which conversion rights may be exercised, and
the Conversion Price and number of shares of Common Stock issuable upon
conversion of a Convertible Perpetual Preferred Share at the time. Upon
surrender of the certificate for any Convertible Perpetual Preferred Shares
so called for redemption and not previously converted (properly endorsed or
assigned for transfer, if the Board shall so require and the notice shall
so state), such shares shall be redeemed by the Corporation at the date
fixed for redemption and at the redemption price set forth in this
paragraph
(6).
(c) Within thirty (30) days after the later of (i) the
effective date, (ii) the enactment date or (iii) if the Corporation
contests in good faith in a judicial or administrative proceeding the
legality of the change referred to in this paragraph (6)(c)(1), the date
such matter is finally determined (the time for appeal having expired and
no appeal having been filed) against the Corporation, of a change in any
statute, rule
<PAGE>
<PAGE> 11
or regulation of the United States of America which has the effect of
limiting or making unavailable to the Corporation all or any of the tax
deductions for amounts paid (including dividends) on the Convertible
Perpetual Preferred Shares when such amounts are used as provided under
Section 404(k)(2) of the Internal Revenue Code of 1986, as amended (the
"Code") and in effect on the date Convertible Perpetual Preferred Shares
are initially issued (other than a change pursuant to H.R. 2572 which is
subject to paragraph (6)(c)(2) below), the Corporation may, in its sole
discretion and notwithstanding anything to the contrary in paragraph (6)(a)
of this Article IV.A.2, elect to either (a) redeem any or all of such
Convertible Perpetual Preferred Shares for cash or, if the Corporation so
elects, in shares of Common Stock, or a combination of such shares of
Common Stock and cash, any such shares of Common Stock to be valued for
such purpose at their Fair Market Value (as defined in paragraph (9)(g) of
this Article IV.A.2), at a redemption price equal to the higher of (x)
$40,300.00 per share or (y) the Fair Market Value of the number of shares
of Common Stock into which each Convertible Perpetual Preferred Share is
convertible at the time the notice of such redemption is given, plus in
either case accrued and unpaid dividends thereon to the date fixed for
redemption, or (b) exchange any or all of such Convertible Perpetual
Preferred Shares for securities of comparable value (as determined by an
independent appraiser) that constitute "qualifying employer securities"
with respect to a holder of Convertible Perpetual Preferred Shares within
the meaning of Section 409(l) of the Code and Section 407(d)(5) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), or
any successor provisions of law.
(d) In the event that the Plan is terminated or the ESOP is
terminated or eliminated from the Plan in accordance with its terms, the
Corporation shall, as soon thereafter as practicable, call for redemption
all the then outstanding Convertible Perpetual Preferred Shares in
accordance with paragraph (6)(a) of this Article IV.A.2.
(e) The Corporation, at its option, may make payment of the
redemption price required upon redemption or Convertible Perpetual
Preferred Shares in cash or in shares of Common Stock, or in a combination
of such Common Stock and cash, any such shares of Common Stock to be valued
for such purposes at their Fair Market Value (as defined in paragraph
(9)(g) of this Article IV.A.2).
(7) Other Redemption Rights. Convertible Perpetual Preferred
Shares shall be redeemed by the Corporation for cash or, if the Corporation
so elects, in shares of Common Stock, or a combination of such shares of
Common Stock and cash, any such shares of Common Stock to be valued for
such purpose at their Fair Market Value, at a redemption price of
$40,300.00 per share plus accrued and unpaid dividends thereon to the date
fixed for redemption, at the option of the holder, at any time and from
time to time upon notice to the Corporation given not less than five (5)
business days prior to the date fixed by the holder in such notice for such
redemption, upon certification by such holder to the Corporation of the
following events: (i) when and to the extent
<PAGE>
<PAGE> 12
necessary for such holder to make any payments of principal, interest or
premium due and payable (whether as scheduled, upon acceleration or
otherwise) under the note from the Trustee to the Company or any
indebtedness, expenses or costs incurred by the holder for the benefit of
the Plan; or (ii) in the event that the Plan is not initially determined by
the Internal Revenue Service to be qualified within the meaning of Sections
401(a) and 4975(e)(7) of the Code. Convertible Perpetual Preferred Shares
shall be redeemed by the Corporation for cash or, if the Corporation so
elects, in shares of Common Stock, or a combination of such shares of
Common Stock and cash, any such shares of Common Stock to be valued for
such purpose at their Fair Market Value (as defined in paragraph (a)(g) of
this Article iv.A.2), at a redemption price equal to the higher of (x)
$40,300.00 per share or (y) the Fair Market Value of the number of shares
of Common Stock into which each Convertible Perpetual Preferred Share is
convertible at the time the notice of such redemption is given, plus in
either case accrued and unpaid dividends thereon to the date fixed for
redemption, at the option of the holder, at any time and from time to time
upon notice to the Corporation given not less than five (5) business days
prior to the date fixed by the holder in such notice for such redemption,
upon certification by such holder to the Corporation that it is necessary
for such holder to provide for distributions required to be made to the
Participants under, or to satisfy an investment election of the
Participants in accordance with, the Plan.
(8) Consolidation, Merger, etc. (a) In the event that the
Corporation shall consummate any consolidation or merger or similar
business combination, pursuant to which the outstanding shares of Common
Stock are by operation of law exchanged solely for or changed, reclassified
or converted solely into stock of any successor or resulting corporation
(including the Corporation) that constitutes "qualifying employer
securities" with respect to a holder of Convertible Perpetual Preferred
Shares within the meaning of Section 409(1) of the Code and Section
407(d)(5) of ERISA or any successor provisions of law, and, if applicable,
for a cash payment in lieu of fractional shares, if any, the Convertible
Perpetual Preferred Shares of such holder shall, in connection with such
consolidation, merger or similar business combination, be assumed by and
shall become preferred stock of such successor or resulting corporation,
having in respect of such corporation, insofar as possible, the same
powers, preferences and relative, participating, optional or other special
rights (including the redemption rights provided by paragraphs (6), (7) and
(8) of this Article IV.A.2), and the qualifications, limitations or
restrictions thereon, that the Convertible Perpetual Preferred Share had
immediately prior to such transaction, except that after such transaction
each Convertible Perpetual Preferred Share shall be convertible, otherwise
on the terms and conditions provided by paragraph (5) of this Article
IV.A.2, into the number and kind of qualifying employer securities so
receivable by a holder of the number of shares of Common Stock into which
such Convertible Perpetual Preferred Shares could have been converted
immediately prior to such transaction; provided, however, that if by virtue
of the structure of such transaction, a holder of Common Stock is required
to make an election with respect to the nature and kind of consideration to
be received in such transaction, which election
<PAGE>
<PAGE> 13
cannot practicably be made by the holders of the Convertible Perpetual
Preferred Shares, then the Convertible Perpetual Preferred Shares shall, by
virtue of such transaction and on the same terms as apply to the holders of
Common Stock, be converted into or exchanged for the aggregate amount of
stock, securities, cash or other property (payable in kind) receivable by a
holder of the number of shares of Common Stock into which such Convertible
Perpetual Preferred Shares could have been converted immediately prior to
such transaction if such holder of Common Stock failed to exercise any
rights of election to receive any kind or amount of stock, securities, cash
or other property (other than such qualifying employer securities and a
cash payment, if applicable, in lieu of fractional shares) receivable upon
such transaction (provided that, if the kind or amount of qualifying
employer securities receivable upon such transaction is not the same for
each non-electing share, then the kind and amount so receivable upon such
transaction for each non-electing share shall be the kind and amount so
receivable per share by the plurality of the non-electing shares). The
rights of the Convertible Perpetual Preferred Shares as preferred stock of
such successor or resulting corporations shall successively be subject to
adjustments pursuant to paragraph (9) of this Article IV.A.2 after any such
transaction as nearly equivalent as practicable to the adjustment provided
for by such section prior to such transaction. The Corporation shall not
consummate any such merger, consolidation or similar transaction unless all
then outstanding Convertible Perpetual Preferred Shares shall be assumed
and authorized by the successor or resulting corporation as aforesaid.
(b) In the event that the Corporation shall consummate any
consolidation or merger or similar business combination, pursuant to which
the outstanding shares of Common Stock are by operation of law exchanged
for or changed, reclassified or converted into other stock or securities or
cash or any other property, or any combination thereof, other than any such
consideration which is constituted solely of qualifying employer securities
(as referred to in paragraph (8)(a) of this Article IV.A.2) and cash
payments, if applicable, in lieu of fractional shares, outstanding
Convertible Perpetual Preferred Shares shall, without any action on the
part of the Corporation or any holder thereof (but subject to paragraph
(8)(c) of this Article IV.A.2), be automatically converted by virtue of
such merger, consolidation or similar transaction immediately prior to such
consummation into the number of shares of Common Stock into which such
Convertible Perpetual Preferred Shares could have been converted at such
time so that each Convertible Perpetual Preferred Share shall, by virtue of
such transaction and on the same terms as apply to the holders of Common
Stock, be converted into or exchanged for the aggregate amount of stock,
securities, cash or other property (payable in like kind) receivable by a
holder of the number of shares of Common Stock into which such Convertible
Perpetual Preferred Shares could have been converted immediately prior to
such transaction; provided, however, that if by virtue of the structure of
such transaction, a holder of Common Stock is required to make an election
with respect to the nature and kind of consideration to be received in such
transaction, which election cannot practicably be made by the holder of the
Convertible
<PAGE>
<PAGE> 14
Perpetual Preferred Shares, then the Convertible Perpetual Preferred Shares
shall, by virtue of such transaction and on the same terms as apply to the
holders of Common Stock, be converted into or exchanged for the aggregate
amount of stock, securities, cash or other property (payable in kind)
receivable by a holder of the number of shares of Common Stock into which
such Convertible Perpetual Preferred Shares could have been converted
immediately prior to such transaction if such holder of Common Stock failed
to exercise any rights of election as to the kind or amount of stock,
securities, cash or other property receivable upon such transaction
(provided that, if the kind or amount of stock, securities, cash or other
property receivable upon such transaction is not the same for each non-
electing share, then the kind and amount of stock, securities, cash or
other property receivable upon such transaction for each non-electing share
shall be the kind and amount so receivable per share by a plurality of the
non-electing shares).
(c) In the event the Corporation shall enter into any
agreement providing for any consolidation or merger or similar business
combination described in paragraph (8)(b) of this Article IV.A.2, then the
Corporation shall as soon as practicable thereafter (and in any event at
least ten (10) business days before consummation of such transaction) give
notice of such agreement and the material terms thereof to each holder of
Convertible Perpetual Preferred Shares and each such holder shall have the
right to elect, by written notice to the Corporation, to receive, upon
consummation of such transaction (if and when such transaction is
consummated), from the Corporation or the successor of the Corporations in
redemption and retirement of such Convertible Perpetual Preferred Shares, a
cash payment equal to the amount payable in respect of Convertible
Perpetual Preferred Shares upon liquidation of the Corporation pursuant to
paragraph (4) of this Article IV.A.2. No such notice of redemption shall be
effective unless given to the Corporation prior to the close of business on
the second business day prior to consummation of such transaction, unless
the Corporation or the successor of the Corporation shall waive such prior
notice, but any notice of redemption so given prior to such time may be
withdrawn by notice of withdrawal given to the Corporation prior to the
close of business on the fifth business day prior to consummation of such
transaction.
(9) Anti-dilution Adjustments. (a) In the event the
Corporation shall, at any time or from time to time while any of the
Convertible Perpetual Preferred Shares are outstanding, (i) pay a dividend
or make a distribution in respect of the Common Stock in shares of Common
Stock, (ii) subdivide the outstanding shares of Common Stock, or (iii)
combine the outstanding shares of Common Stock into a smaller number of
shares, in each case whether by reclassification of shares,
recapitalization of the Corporation (including a recapitalization effected
by a merger or consolidation to which paragraph (8) of this Article IV.A.2
does not apply) or otherwise, the Conversion Price in effect immediately
prior to such action shall be adjusted by multiplying such Conversion Price
by a fraction, the numerator of which is the number of shares of Common
Stock outstanding immediately before such event, and the denominator of
which
<PAGE>
<PAGE> 15
is the number of shares of Common Stock outstanding immediately after such
event. An adjustment made pursuant to this paragraph (9)(A) shall be given
effect, upon payment of such a dividend or distribution, as of the record
date for the determination of stockholders entitled to receive such
dividend or distribution (on a retroactive basis) and in the case of a
subdivision or combination shall become effective immediately as of the
effective date thereof.
(b) In the event that the Corporation shall, at any time or
from time to time while any of the Convertible Perpetual Preferred Shares
are outstanding, issue to holders of shares of Common Stock as a dividend
or distribution, including by way of a reclassification of shares or a
recapitalization of the Corporation, any right or warrant to purchase
shares of Common Stock (but not including as such a right or warrant any
security convertible into or exchangeable for shares of Common Stock) at a
purchase price per share less than the Fair Market Value (as hereinafter
defined) of a share of Common Stock on the date of issuance of such right
or warrant, then, subject to the provisions of paragraphs (9)(e) and (f) of
this Article IV.A.2, the Conversion Price shall be adjusted by multiplying
such Conversion Price by a fraction, the numerator of which shall be the
number of shares of Common Stock outstanding immediately before such
issuance of rights or warrants plus the number of shares of Common Stock
which could be purchased at the Fair Market Value of a share of Common
Stock at the time of such issuance for the maximum aggregate consideration
payable upon exercise in full of all such rights or warrants, and the
denominator of which shall be the number of shares of Common Stock
outstanding immediately before such issuance of rights or warrants plus the
number of shares of Common Stock that could be acquired upon exercise in
full of all such rights and warrants.
(c) In the event the Corporation shall, at any time or from
time to time while any of the Convertible Perpetual Preferred Shares are
outstanding, issue, sell or exchange shares of Common Stock (other than
pursuant to any right or warrant to purchase or acquire shares of Common
Stock (including as such a right or warrant any security convertible into
or exchangeable for shares of Common Stock) and other than pursuant to any
employee or director incentive or benefit plan or arrangement, including
any employment, severance or consulting agreement, of the Corporation or
any subsidiary of the Corporation heretofore or hereafter adopted) for a
consideration having a Fair Market Value, on the date of such issuance,
sale or exchange, less than the Fair Market Value of such shares on the
date of issuance, sale or exchange, then, subject to the provisions of
paragraphs (9)(e) and (f) of this Article IV.A.2, the Conversion Price
shall be adjusted by multiplying such Conversion Price by a fraction the
numerator of which shall be the sum of (i) the Fair Market Value of all the
shares of Common Stock outstanding on the day immediately preceding the
first public announcement of such issuance, sale or exchange plus (ii) the
Fair Market Value of the consideration received by the Corporation in
respect of such issuance, sale or exchange of shares of Common Stock, and
the denominator of which shall be the product of (a) the Fair Market Value
<PAGE>
<PAGE> 16
of a share of Common Stock on the day immediately preceding the first
public announcement of such issuance, sale or exchange multiplied by (b)
the sum of the number of shares of Common stock outstanding on such day
plus the number of shares of Common Stock so issued, sold or exchanged by
the Corporation. In the event the Corporation shall, at any time or from
time to time while any Convertible Perpetual Preferred Shares are
outstanding, issue, sell or exchange any right or warrant to purchase or
acquire shares of Common Stock (including as such a right or warrant any
security convertible into or exchangeable for shares of Common Stock),
other than any such issuance to holders of shares of Common Stock as a
dividend or distribution (including by way of a reclassification of shares
or a recapitalization of the Corporation) and other than pursuant to any
employee or director incentive or benefit plan or arrangement (including
any employment, severance or consulting agreement) of the Corporation or
any subsidiary of the Corporation heretofore or hereafter adopted, for a
consideration having a Fair Market Value, on the date of such issuance,
sale or exchange, less than the Non-Dilutive Amount (as hereinafter
defined), then, subject to the provisions of paragraphs (9)(e) and (f) of
this Article IV.A.2, the Conversion Price shall be adjusted by multiplying
such Conversion Price by a fraction the numerator of which shall be the sum
of (I) the Fair Market Value of all the shares of Common Stock outstanding
on the day immediately preceding the first public announcement of such
issuance, sale or exchange plus (II) the Fair Market Value of the
consideration received by the Corporation in respect of such issuance, sale
or exchange of such right or warrant plus (III) the Fair Market Value at
the time of such issuance of the consideration which the Corporation would
receive upon exercise in full of all such rights or warrants, and the
denominator of which shall be the product of (i) the Fair Market Value of a
share of Common Stock on the day immediately preceding the first public
announcement of such issuance, sale or exchange multiplied by (ii) the sum
of the number of shares of Common Stock outstanding on such day plus the
maximum number of shares of Common Stock which could be acquired pursuant
to such right or warrant at the time of the issuance, sale or exchange of
such right or warrant (assuming shares of Common Stock could be acquired
pursuant to such right or warrant at such time).
(d) In the event the Corporation shall, at any time or from
time to time while any of the Convertible Perpetual Preferred Shares are
outstanding, make an Extraordinary Distribution (as hereinafter defined) in
respect of the Common Stock, whether by dividend, distribution,
reclassification of shares or recapitalization of the Corporation
(including a recapitalization or reclassification effected by a merger or
consolidation to which paragraph (8) of this Article IV.A.2 does not apply)
or effect a Pro Rata Repurchase (as hereinafter defined) of Common Stock,
the Conversion Price in effect immediately prior to such Extraordinary
Distribution or Pro Rata Repurchase shall, subject to paragraphs (9)(e) and
(f) of this Article IV.A.2, be adjusted by multiplying such Conversion
Price by the fraction, the numerator of which is the difference between (i)
the product of (x) the number of shares of Common Stock outstanding
immediately before such Extraordinary Distribution or Pro Rata Repurchase
<PAGE>
<PAGE> 17
multiplied by (y) the Fair Market Value of a share of Common Stock on the
day before the ex-dividend date with respect to an Extraordinary
Distribution which is paid in cash and on the distribution date with
respect to an Extraordinary Distribution which is paid other than in cash,
or on the applicable expiration date (including all extensions thereof) of
any tender offer which is a Pro Rata Repurchase, or on the applicable
expiration date (including all extensions thereof) of any tender offer
which is a Pro Rata Repurchase, or on the date of purchase with respect to
any Pro Rata Repurchase which is not a tender offer, as the case may be,
and (ii) the Fair Market Value of the Extraordinary Distribution minus the
aggregate amount of regularly scheduled quarterly dividends declared by the
Board and paid by the Corporation in the twelve months immediately
preceding such Extraordinary Distribution or the aggregate purchase price
of the Pro Rata Repurchase, as the case may be, and the denominator of
which shall be the product of (a) the number of shares of Common Stock
outstanding immediately before such Extraordinary Dividend or Pro Rata
Repurchase minus, in the case of a Pro Rata Repurchase, the number of
shares of Common Stock repurchased by the Corporation multiplied by (b) the
Fair Market Value of a share of Common Stock on the day before the ex-
dividend date with respect to an Extraordinary Distribution which is paid
in cash and on the distribution date with respect to an Extraordinary
Distribution which is paid other than in cash, or on the applicable
expiration date (including all extensions thereof) of any tender offer
which is a Pro Rata Repurchase or on the date of purchase with respect to
any Pro Rata Repurchase which is not a tender offer, as the case may be.
The Corporation shall send each holder of Convertible Perpetual Preferred
Shares (i) notice of its intent to make any dividend or distribution and
(ii) notice of any offer by the Corporation to make a Pro Rata Repurchase,
in each case at the same time as, or as soon as practicable after, such
offer is first communicated (including by announcement of a record date in
accordance with the rules of any stock exchange on which the Common Stock
is listed or admitted to trading) to holders of Common Stock. Such notice
shall indicate the intended record date and the amount and nature of such
dividend or distribution, or the number of shares subject to such offer for
a Pro Rata Repurchase and the purchase price payable by the Corporation
pursuant to such offer, as well as the Conversion Price and the number of
shares of Common Stock into which a Convertible Perpetual Preferred Share
may be converted at such time.
(e) Notwithstanding any other provision of this paragraph
(9), the Corporation shall not be required to make any adjustment to the
Conversion Price unless such adjustment would require an increase or
decrease of at least one percent (1%) in the Conversion Price. Any lesser
adjustment shall be carried forward and shall be made no later than the
time of, and together with, the next subsequent adjustment which, together
with any adjustment or adjustments so carried forward, shall amount to an
increase or decrease of at least one percent (1%) in the Conversion Price.
(f) If the Corporation shall make any dividend or
distribution on the Common Stock or issue any Common Stock, other capital
stock or other security of the
<PAGE>
<PAGE> 18
Corporation or any rights or warrants to purchase or acquire any such
security, which transaction does not result in an adjustment to the
Conversion Price pursuant to the foregoing provisions of this paragraph
(9), the Board shall consider whether such action is of such a nature that
an adjustment to the Conversion Price should equitably be made in respect
of such transaction. If in such case the Board determines that an
adjustment to the Conversion Price should be made, an adjustment shall be
made effective as of such date, as determined by the Board. The
determination of the Board as to whether an adjustment to the Conversion
Price should be made pursuant to the foregoing provisions of this paragraph
(9)(f), and, if so, as to what adjustment should be made and when, shall be
final and binding on the Corporation and all shareholders of the
Corporation. The Corporation shall be entitled to make such additional
adjustments in the Conversion Price, in addition to those required by the
foregoing provisions of this paragraph (9), as shall be necessary in order
that any dividend or distribution in shares of capital stock of the
Corporation, subdivision, reclassification or combination of shares of
stock of the Corporation or any recapitalization of the Corporation shall
not be taxable to the holders of the Common Stock.
(g) For purposes of this Article IV.A.2., the following
definitions shall apply:
"Business Day" shall mean each day that is not a Saturday,
Sunday or a day on which state or federally chartered banking
institutions in New York are not required to be open.
"Current Market Price" of publicly traded shares of Common
Stock or any other class of capital stock or other security of the
Corporation or any other issuer for any day shall mean the last
reported sales price, regular way, or, in the event that no sale
takes place on such day, the average of the reported closing bid and
asked prices, regular way, in either case as reported on the New York
Stock Exchange Composite Tape or, if such security is not listed or
admitted to trading on the New York Stock Exchange, on the principal
national securities exchange on which such security is listed or
admitted to trading or, if not listed or admitted to trading on any
national securities exchange, on the NASDAQ National Market System
or, if such security is not quoted on such National Market System,
the average of the closing bid and asked prices on each such day in
the over-the-counter market as reported by NASDAQ or, if bid and
asked prices for such security on each such day shall not have been
reported through NASDAQ, the average of the bid and asked prices for
such day as furnished by any New York Stock Exchange member firm
regularly making a market in such security selected for such purpose
by the Board of Directors of the Corporation or a committee thereof.
<PAGE>
<PAGE> 19
"Extraordinary Distribution" shall mean any dividend or other
distribution to holders of Common Stock (effected while any of the
Convertible Perpetual Preferred Shares are outstanding) (i) of cash,
where the aggregate amount of such cash dividend or distribution
together with the amount of all cash dividends and distributions made
during the preceding period of 12 months, when combined with the
aggregate amount of all Pro Rata Repurchases (for this purpose,
including only that portion of the aggregate purchase price of such
Pro Rata Repurchase which is in excess of the Fair Market Value of
the Common Stock repurchased as determined on the Business Day
immediately following the applicable expiration date (including all
extensions thereof) of any tender offer or exchange offer which is a
Pro Rata Repurchase, or the date of purchase with respect to any
other Pro Rata Repurchase which is not a tender offer or exchange
offer made during such period), exceeds ten percent (10%) of the
aggregate Fair Market Value of all shares of Common Stock outstanding
on the day before the ex-dividend date with respect to such
Extraordinary Distribution which is paid in cash and on the
distribution date with respect to an Extraordinary Distribution which
is paid other than in cash, and/or (ii) of any shares of capital
stock of the Corporation (other than shares of Common Stock), other
securities of the Corporation (other than securities of the type
referred to in paragraph (9)(b) or (c) of this Article IV.A.2),
evidences of indebtedness of the Corporation or any other person or
any other property (including shares of any subsidiary of the
Corporation) or any combination thereof. The Fair Market Value of an
Extraordinary Distribution for purposes of paragraph (9)(d) of this
Article IV.A.2 shall be equal to the sum of the Fair Market Value of
such Extraordinary Distribution plus the amount of any cash dividends
which are not Extraordinary Distributions made during such 12-month
period and not previously included in the calculation of an
adjustment pursuant to paragraph (9)(d) of this Article IV.A.2.
"Fair Market Value" shall mean, as to shares of Common Stock or
any other class of capital stock or securities of the Corporation or
any other issuer which are publicly traded, (i) for purposes of
paragraphs (6) and (7) of this Article IV.A.2, the Current Market
Price on the date as of which the Fair Market Value is to be
determined, and (ii) for all other purposes hereof, the average of
the Current Market Prices of such shares or securities for each day
of the Adjustment Period. "Adjustment Period" shall mean the period
of five (5) consecutive trading days preceding, and including, the
date as of which the Fair Market Value of a security is to be
determined. The Fair Market Value of any security which is not
publicly traded (other than the Convertible Perpetual Preferred
Shares) or of any other property shall mean the fair value thereof as
determined by an independent investment banking or appraisal firm
experienced in the valuation of such securities or property selected
in good faith by the Board or a committee thereof, or, if no such
investment banking or appraisal firm is in
<PAGE>
<PAGE> 20
the good faith judgment of the Board or such committee available to
make such determination, as determined in good faith by the Board or
such committee.
"Non-Dilutive Amount" in respect of an issuance, sale or
exchange by the Corporation of any right or warrant to purchase or
acquire shares of Common Stock (including any security convertible
into or exchangeable for shares of Common Stock) shall mean the
difference between (i) the product of the Fair Market Value of a
share of Common Stock on the day preceding the first public
announcement of such issuance, sale or exchange multiplied by the
maximum number of shares of Common Stock which could be acquired on
such date upon the exercise in full of such rights and warrants
(including upon the conversion or exchange of all such convertible or
exchangeable securities), whether or not exercisable (or convertible
or exchangeable) at such date, and (ii) the aggregate amount payable
pursuant to such right or warrant to purchase or acquire such maximum
number of shares of Common Stock; provided, however, that in no event
shall the Non-Dilutive Amount be less than zero. For purposes of the
foregoing sentence, in the case of a security convertible into or
exchangeable for shares of Common Stock, the amount payable pursuant
to a right or warrant to purchase or acquire shares of Common Stock
shall be the Fair Market Value of such security on the date of the
issuance, sale or exchange of such security by the Corporation.
"Pro Rata Repurchase" shall mean any purchase of shares of
Common Stock by the Corporation or any subsidiary thereof, whether
for cash, shares of capital stock of the Corporation, other
securities of the Corporation, evidences of indebtedness of the
Corporation or any other person or any other property (including
shares of a subsidiary of the Corporation), or any combination
thereof, affected while any of the Convertible Perpetual Preferred
Shares are outstanding, pursuant to any tender offer or exchange
offer subject to Section 13(e) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), or any successor provision of
law, or pursuant to any other offer available to substantially all
holders of Common Stock; provided, however, that no purchase of
shares by the Corporation or any subsidiary thereof made in open
market transactions shall be deemed a Pro Rata Repurchase. For
purposes of this paragraph (9)(g) of this Article IV.A.2, shares
shall be deemed to have been purchased by the Corporation or any
subsidiary thereof "in open market transactions" if they have been
purchased substantially in accordance with the requirements of Rule
10b-18 as in effect under the Exchange Act, on the date Convertible
Perpetual Preferred Shares are initially issued by the Corporation or
on such other terms and conditions as the Board or a committee
thereof shall have determined are reasonably designed to prevent such
purchases from having a material effect on the trading market for the
Common Stock.
<PAGE>
<PAGE> 21
(h) Whenever an adjustment to the Conversion Price and the
related voting rights of the convertible Perpetual Preferred Shares is
required pursuant to this Article IV.A.2., the Corporation shall forthwith
place on file with the transfer agent for the Common Stock and the
Convertible Perpetual Preferred Shares, and with the Secretary of the
Corporation, a statement signed by two officers of the Corporation stating
the adjusted Conversion Price determined as provided herein and the
resulting conversion ratio, and the voting rights (as appropriately
adjusted), of the Convertible Perpetual Preferred Shares. Such statement
shall set forth in reasonable detail such facts as shall be necessary to
show the reason and the manner of computing such adjustment, including any
determination of Fair Market Value involved in such computation. Promptly
after each adjustment to the Conversion Price and the related voting rights
of the Convertible Perpetual Preferred Shares, the Corporation shall mail a
notice thereof and of the then prevailing conversion ratio to each holder
of Convertible Perpetual Preferred Shares.
(10) Ranking; Attributable Capital And Adequacy of Surplus;
Retirement of Shares. (a) The Convertible Perpetual Preferred Shares
shall rank senior to the Common Stock as to the payment of dividends and
the distribution of assets on liquidation, dissolution and winding-up of
the Corporation, and, unless otherwise provided in the Restated Certificate
of Incorporation of the Corporation, as the same may be amended, or a
Certificate of Designation relating to a subsequent series of Preferred
Stock, par value $0.01 per share, of the Corporation, the Convertible
Perpetual Preferred Shares shall rank junior to all series of the
Corporation's Preferred Stock, par value $0.01 per share as to the payment
of dividends and the distribution of assets on liquidation, dissolution or
winding-up.
(b) In addition to any vote of stockholders required by law
or by paragraph (3)(b) of this Article IV.A.2., the vote of the holders of
a majority of the outstanding Convertible Perpetual Preferred Shares shall
be required to increase the par value of the Common Stock or otherwise
increase the capital of the Corporation allocable to the Common Stock for
the purpose of the General Corporation Law if, as a result thereof, the
surplus of the Corporation for purposes of the General Corporation Law
would be less than the amount of Convertible Perpetual Preferred Dividends
that would accrue on the then outstanding Convertible Perpetual Preferred
Shares during the following three years.
(c) Any Convertible Perpetual Preferred Shares acquired by
the Corporation by reason of the conversion or redemption of such shares as
provided by this Article IV.A.2., or otherwise so acquired, shall be
retired as Convertible Perpetual Preferred Shares and restored to the
status of authorized but unissued shares of Preferred Stock, par value
$0.01 per share, of the Corporation, undesignated as to series, and may
thereafter be reissued as part of a new series of such Preferred Stock as
permitted by law.
<PAGE>
<PAGE> 22
(11) Miscellaneous. (a) All notices referred to in this
Article IV.A.2 shall be in writing, and all notices hereunder shall be
deemed to have been given upon the earlier of delivery thereof if by hand
delivery, by courier or by standard form of telecommunication or three (3)
Business Days after the mailing thereof if sent by registered mail (unless
first-class mail shall be specifically permitted for such notice under the
terms of this Article IV.A.2.) with postage prepaid, addressed: (i) if to
the Corporation, to its office at Fleming Way, Crawley, Sussex, RH10 2LZ,
England (Attention: Secretary), or to the transfer agent for the
Convertible Perpetual Preferred Shares, or other agent of the Corporation
designated as permitted by this Article IV.A.2. or (ii) if to any holder of
the Convertible Perpetual Preferred Shares or Common Stock, as the case may
be, to such holder at the address of such holder as listed in the stock
record books of the Corporation (which may include the records of any
transfer agent for the Convertible Perpetual Preferred Shares or Common
Stock, as the case may be) or (iii) to such other address as the
Corporation or any such holder, as the case may be, shall have designated
by notice similarly given.
(b) The term "Common Stock" as used in this Article IV.A.2.
means the Corporation's Common Stock, par value $0.01 per share, as the
same exists at the date of filing of a Certificate of Designation relating
to Convertible Perpetual Preferred Shares or any other class of stock
resulting from successive changes or reclassifications of such Common Stock
consisting solely of changes in par value, or from par value to no par
value, or from no par value to par value. In the event that, at any time as
a result of an adjustment made pursuant to paragraph (9) of this Article
IV.A.2., the holder of any Convertible Perpetual Preferred Shares upon
thereafter surrendering such shares for conversion, shall become entitled
to receive any shares or other securities of the Corporation other than
shares of Common Stock, the Conversion Price in respect of such other
shares or securities so receivable upon conversion of Convertible Perpetual
Preferred Shares shall thereafter be adjusted, and shall be subject to
further adjustment from time to time, in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to Common Stock
contained in paragraph (9) of this Article IV.A.2, and the provisions of
paragraphs (1) through (8), (10) and (11) of this Article IV.A.2. with
respect to the Common Stock shall apply on like or similar terms to any
such other shares or securities.
(c) The Corporation shall pay any and all stock transfer and
documentary stamp taxes that may be payable in respect of any issuance or
delivery of Convertible Perpetual Preferred Shares or shares of Common
Stock or other securities issued on account of Convertible Perpetual
Preferred Shares pursuant hereto or certificates representing such shares
or securities. The Corporation shall not, however, be required to pay any
such tax which may be payable in respect of any transfer involved in the
issuance or delivery of Convertible Perpetual Preferred Shares or Common
Stock or other securities in a name other than that in which the
Convertible Perpetual Preferred Shares with respect to which such shares or
other securities are issued or delivered were
<PAGE>
<PAGE> 23
registered, or in respect of any payment to any person with respect to any
such shares or securities other than a payment, to the registered holder
thereof, and shall not be required to make any such issuance, delivery or
payment unless and until the person otherwise entitled to such issuance,
delivery or payment has paid to the Corporation the amount of any such tax
or has established, to the satisfaction of the Corporation, that such tax
has been paid or is not payable.
(d) In the event that a holder of Convertible Perpetual
Preferred Shares shall not by written notice designate the name in which
shares of Common Stock to be issued upon conversion of such shares should
be registered or to whom payment upon redemption of Convertible Perpetual
Preferred Shares should be made or the addresses to which the certificate
or certificates representing such shares, or such payment, should be sent,
the Corporation shall be entitled to register such shares and make such
payment, in the name of the holder of such Convertible Perpetual Preferred
Shares as shown on the records of the Corporation and to send the
certificate or certificates representing such shares, or such payment, to
the address of such holder shown on the records of the Corporation.
(e) Unless otherwise provided in the Restated Certificate of
Incorporation, as the same may be amended, of the Corporation, all payments
in the form of dividends, distributions on voluntary or involuntary
dissolution, liquidation or winding-up or otherwise made upon the
Convertible Perpetual Preferred Shares and any other stock ranking on a
parity with the Convertible Perpetual Preferred Shares with respect to such
dividend or distribution shall be pro rata, so that amounts paid per
Convertible Perpetual Preferred Share and such other stock shall in all
cases bear to each other the same ratio that the required dividends,
distributions or payments, as the case may be, then payable per share on
the Convertible Perpetual Preferred Share and such other stock bear to each
other.
(f) Any determination required or permitted to be made by the
Board hereunder may be made by a committee appointed by the Board which
need not include members of the Board.
(g) The Corporation may appoint, and from time to time
discharge and change, a transfer agent for the Convertible Perpetual
Preferred Shares. Upon any such appointment or discharge of a transfer
agent, the Corporation shall send notice thereof by hand delivery, by
courier, by standard form of telecommunication or by first-class mail,
(postage prepaid), to each holder of record of Convertible Perpetual
Preferred Shares.
<PAGE>
<PAGE> 24
B. Common Stock
(1) Subject to all of the rights of the Preferred Stock,
except as may be expressly provided with respect to the Preferred Stock
herein, by law or by the Board pursuant to this Article IV:
(a) dividends may be declared and paid or set apart for
payment upon the Common Stock only out of any assets or funds of the
Corporation legally available for the payment of dividends;
(b) the holders of Common Stock shall have the exclusive
right to vote for the election of Directors of the Corporation (the
"Directors") and on all other matters requiring stockholder action,
each share of Common Stock being entitled to one vote; and
(c) upon the voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, the net assets of the
Corporation shall be distributed pro rata to the holders of the
Common Stock in accordance with their respective rights and
interests.
ARTICLE V
Directors
(1) Elections of Directors of the Corporation need not be by
written ballot, except and to the extent provided in the By-Laws of the
Corporation.
(2) The number of Directors of the Corporation shall be an
even number fixed from time to time in the manner provided by the By-laws
of the Corporation, but in no event shall such number be less than eight
(8) nor more than sixteen (16). At least half of the Directors shall be
Independent Directors as such term is used in Rule 303 of the Rules of the
New York Stock Exchange as in existence on the date hereof or as amended
from time to time hereafter.
(3) The Board shall be divided into three classes, each class
to have, as nearly as may be possible, an equal number of Directors. The
term of office of Directors of the first class shall expire at the annual
meeting of stockholders next ensuing this classification; the term of
office of Directors of the second class shall expire at the second annual
meeting of stockholders next ensuing this classification; and the term of
office of Directors of the third class shall expire at the third annual
meeting of stockholders next ensuing this classification. At each annual
meeting of the stockholders, Directors of each class whose term then
expires shall be elected for a full term of three
<PAGE>
<PAGE> 25
years to succeed the Directors of such class, so that the term of office of
the Directors of one class shall expire in each year; provided that nothing
herein shall be construed to prevent (i) the election of a Director to
succeed himself or herself, or (ii) the election of a Director for the
remainder of an unexpired term in the class of Directors to which he or she
is elected.
(4) Except as otherwise fixed pursuant to the provisions of
this Article V relating to the rights of the holders of any class or series
of stock having a preference over the Common Stock as to dividends or upon
liquidation to elect Directors under specified circumstances, newly created
directorships resulting from any increase in the number of Directors and
any vacancies on the Board resulting from death, resignation,
disqualification, removal or other cause shall be filled solely by the
affirmative vote of a majority of the remaining Directors then in office,
even though less than a quorum. Any Director elected in accordance with the
preceding sentence shall hold office for the remainder of the full term of
the class of Directors in which the new directorship was created or the
vacancy occurred and until such Director's successor shall have been
elected and qualified. No decrease in the number of Directors constituting
the Board shall shorten the term of any incumbent Director.
(5) To the fullest extent permitted by the General
Corporation Law as it now exists and as it may hereafter be amended, no
Director of the Corporation shall be personally liable to the Corporation
or its stockholders for monetary damages for breach of fiduciary duty as a
Director.
ARTICLE VI
STOCKHOLDERS
(1) Any action required or permitted to be taken by the
stockholders of the Corporation must be effected at a duly called annual or
special meeting of such holders and may not be effected by any consent in
writing by any such holders. Except as otherwise required by law and
subject to the rights of the holders of any class or series of stock having
a preference over the Common Stock as to dividends or upon liquidation,
special meetings of stockholders of the Corporation may be called only by
the Chairman of the Board, the Chief Executive Officer, or a majority of
the Directors.
<PAGE>
<PAGE> 26
(2) Except as otherwise provided by law, at any annual or
special meeting of stockholders only such business shall be conducted as
shall have been properly brought before the meeting in accordance with the
provisions of this Restated Certificate of Incorporation and the By-Laws of
the Corporation. In order to be properly brought before the meeting, such
business must have either been (a) brought before the meeting by or at the
direction of the Board or (b) by any stockholder in accordance with the
following requirements:
(i) Any stockholder entitled to vote at such annual meeting
may propose business (other than nominations for the election of
Directors) to be included in the agenda of such meeting only if
written notice of such stockholder's intent is given to the Secretary
of the Corporation (the "Secretary"), either personally or by mail,
postage prepaid, not earlier than 90 days nor later than 60 days in
advance of the anniversary of the date of the immediately preceding
annual meeting or if the date of the annual meeting occurs more than
30 days before or 60 days after the anniversary of such immediately
preceding annual meeting, not later than the close of business on the
later of (a) the sixtieth day prior to such annual meeting and (b)
the tenth day following the date on which public announcement of the
date of such meeting is first made. A stockholder's notice to the
Secretary shall set forth in writing as to each business matter such
stockholder proposes to bring before the annual meeting (a) a brief
description of the business desired to be brought before the annual
meeting and the reasons for conducting such business at the annual
meeting, (b) the name and address, as they appear on the
Corporation's books, of the stockholder proposing such business, (c)
the class and number of shares of the Corporation that are
beneficially owned by the stockholder and (d) any material interest
of the stockholder in such business. Notwithstanding anything in this
Restated Certificate of Incorporation to the contrary, no business
shall be conducted at an annual meeting except in accordance with the
procedures set forth in this paragraph (2) of this Article VI. The
officer of the Corporation or other person presiding at the annual
meeting shall, if the facts so warrant, determine and declare to the
meeting that business was not properly brought before the meeting in
accordance with the provisions of this section, and, if he should so
determine, he shall so declare to the meeting and any such business
not properly brought before the meeting shall not be transacted.
(ii) Nominations for the election of Directors may be made by
the Board or any stockholder entitled to vote for the election of
Directors. Any stockholder entitled to vote for the election of
Directors at the annual meeting of the stockholders of the
Corporation may nominate a person or persons for election as a
Director only if written notice of such stockholder's intent to make
such nomination is given to the Secretary in accordance with the
procedures set forth in the immediately preceding paragraph of this
Article VI.2. Each such notice
<PAGE>
<PAGE> 27
shall set forth the name and address of the stockholder who intends
to make the nomination and of the person or persons to be nominated
for election as a Director; a representation that the stockholder is
a holder of record of stock of the Corporation entitled to vote at
such meeting and intends to appear in person or by proxy at the
meeting to nominate the person or persons specified in the notice; a
description of all arrangements or understandings between the
stockholder and each nominee and any other person or persons (naming
such person or persons) pursuant to which the nomination or
nominations for election as a Director are to be amended by the
stockholder; such other information regarding each nominee proposed
by such stockholder as would have been required to be included in a
proxy statement filed pursuant to the proxy rules of the United
States Securities and Exchange Commission if such nominee had been
nominated, or was intended to be nominated, for election as a
Director by the Board; and the consent of each nominee to serve as a
Director of the Corporation if so elected. The Board may refuse to
acknowledge the nomination of any person not made in compliance with
the foregoing procedures.
(iii) For purposes hereof, "public announcement" shall mean
disclosure in a press release reported by the Dow Jones News Service,
Associated Press or a comparable Swedish or United States news
service or in a document publicly filed by the Corporation with the
Stockholm Stock Exchange and the United States Securities and
Exchange Commission pursuant to Section 13, 14 or 15(d) of the United
States Securities Exchange Act of 1934, as amended.
ARTICLE VII
Indemnification of Directors, Officers and Others
(1) The Corporation shall indemnify any person who was or is
a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of
the Corporation) by reason of the fact that he or she is or was a Director,
officer, employee or agent of the Corporation, or is or was serving at the
request of the Corporation as a Director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by him or her in
connection with such action, suit or proceeding if he or she acted in good
faith and in a manner he or she reasonably believed to be in, or not
opposed to, the best interests of the Corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his or
her conduct was unlawful. The termination of any action, suit or proceeding
by judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, shall not, of
<PAGE>
<PAGE> 28
itself, create a presumption that the person seeking indemnification did
not act in good faith and in a manner which he or she reasonably believed
to be in or not opposed to the best interests of the Corporation, and, with
respect to any criminal action or proceeding, had reasonable cause to
believe that his or her conduct was unlawful.
(2) The Corporation shall indemnify any person who was or is
a party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the Corporation to procure a
judgment in its favor by reason of the fact that he or she is or was a
Director, officer, employee or agent of the Corporation, or is or was
serving at the request of the Corporation as a Director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise against expenses (including attorneys' fees) actually and
reasonably incurred by him or her in connection with the defense or
settlement of such action or suit if he or she acted in good faith and in a
manner he or she reasonably believed to be in or not opposed to the best
interests of the Corporation and except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable to the Corporation unless and only to the
extent that the Court of Chancery of the State of Delaware or the court in
which such action or suit was brought shall determine upon application
that, despite the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of Chancery or such other court
shall deem proper.
(3) To the extent that a Director, officer, employee or agent
of the Corporation has been successful on the merits or otherwise in
defense of any action, suit or proceeding referred to in paragraphs (1) and
(2) of this Article VII, or in defense of any claim, issue or matter
therein, he or she shall be indemnified against expenses (including
attorneys' fees) actually and reasonably incurred by him or her in
connection therewith.
(4) Any indemnification under paragraphs (1) and (2) of this
Article VII (unless ordered by a court) shall be made by the Corporation
only as authorized in the specific case upon a determination that
indemnification of the Director, officer, employee or agent is proper in
the circumstances because he or she has met the applicable standard of
conduct set forth in such paragraphs (1) and (2). Such determination shall
be made (a) by the Board by a majority vote of a quorum consisting of
Directors who were not parties to such action, suit or proceeding, or
(b) if such a quorum is not obtainable, or, even if obtainable, a quorum of
disinterested Directors so directs, by independent legal counsel in a
written opinion, or (c) by the stockholders of the Corporation.
(5) Expenses (including attorneys' fees) incurred by an
officer or Director in defending any civil, criminal, administrative or
investigative action, suit or proceeding may be paid by the Corporation, as
the Board deems appropriate, in advance
<PAGE>
<PAGE> 29
of the final disposition of such action, suit or proceeding upon receipt of
an undertaking by or on behalf of such Director or officer to repay such
amount if it shall ultimately be determined that he or she is not entitled
to be indemnified by the Corporation authorized in this Article VII. Such
expenses (including attorneys' fees) incurred by other employees and agents
may be so paid upon such terms and conditions, if any, as the Board deems
appropriate.
(6) The indemnification and advancement of expenses provided
by, or granted pursuant to, the other sections of this Article VII shall
not be deemed exclusive of any other rights to which those seeking
indemnification or advancement of expenses may be entitled under any law,
by-law, agreement, vote of stockholders or disinterested Directors or
otherwise, both as to action in an official capacity and as to action in
another capacity while holding such office.
(7) The Corporation may purchase and maintain insurance on
behalf of any person who is or was a Director, officer, employee or agent
of the Corporation, or is or was serving at the request of the Corporation
as a Director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise against any liability
asserted against him or her and incurred by him or her in any such
capacity, or arising out of his or her status as such, whether or not the
Corporation would have the power to indemnify him or her against such
liability under the provisions of Section 145 of the General Corporation
Law.
(8) For purposes of this Article VII, references to "the
Corporation" shall include, in addition to the Corporation, any constituent
corporation, including Pharmacia Aktiebolag ("Pharmacia"), The Upjohn
Company ("Upjohn") and any companies to which Pharmacia and Upjohn had
previously extended rights similar to those afforded by this Article VII
would have had power and authority to indemnify its Directors, officers,
employees or agents so that any person who is or was a Director, officer,
employee or agent of such constituent corporation, or is or was serving at
the request of such constituent corporation as a Director, officer,
employee or agent of another corporation, partnership, joint venture, trust
or other enterprise, shall stand in the same position under the provisions
of this Article VII with respect to the resulting or surviving corporation
as he or she would have with respect to such constituent corporation if its
separate existence had continued.
(9) For purposes of this Article VII, references to "other
enterprises" shall include employee benefit plans; references to "fines"
shall include any excise taxes assessed on a person with respect to an
employee benefit plan; and references to "serving at the request of the
Corporation" shall include any service as a Director, officer, employee or
agent of the Corporation which imposes duties on, or involves service by,
such Director, officer, employee or agent with respect to any employee
benefit plan, its participants or beneficiaries; and a person who acted in
good faith and in a manner he
<PAGE>
<PAGE> 30
or she reasonably believed to be in the interest of the participants and
beneficiaries of an employee benefit plan shall be deemed to have acted in
a manner "not opposed to the best interests of the Corporation" as referred
to in this Article VII.
(10) The indemnification and advancement of expenses provided
by, or granted pursuant to, this Article VII shall, unless otherwise
provided when authorized or ratified, continue as to a person who has
ceased to be a Director, officer, employee or agent and shall inure to the
benefit of the heirs, executors and administrators of such a person.
ARTICLE VIII
By-Laws
(1) In furtherance and not in limitation of the powers
conferred by the laws of the State of Delaware, the Board is expressly
authorized and empowered in the manner provided in the By-Laws of the
Corporation, to make, alter, amend and repeal the By-Laws of the
Corporation in any respect not inconsistent with the laws of the State of
Delaware or with the Restated Certificate of Incorporation of the
Corporation, but the Board shall not repeal any By-Law hereafter made by
the stockholders.
(2) Notwithstanding the provisions of paragraph (1) of this
Article VIII, however, any alteration, amendment or repeal of those
provisions of the By-Laws whose amendment, alteration or repeal requires
the affirmative vote of 80% of all the Directors or 66-2/3% of the then
outstanding shares of capital stock of the Corporation entitled to vote on
matters submitted to stockholders of the Corporation (the "Voting Stock"
and a "Supermajority Vote") shall require the affirmative vote of 80% of
all the Directors.
ARTICLE IX
Reorganization
Whenever a compromise or arrangement is proposed between this
Corporation and its creditors or any class of them and/or between this
Corporation and its stockholders or any class of them, any court of
equitable jurisdiction within the State of Delaware may, on the application
in a summary way of this Corporation or of any creditor or stockholder
thereof or on the application of any receiver or receivers appointed for
this Corporation under the provisions of Section 291 of Title 8 of the
Delaware Code or on the application of trustees in dissolution or of any
receiver or receivers appointed for this Corporation under the provisions
of Section 279 of Title 8 of the Delaware Code order a meeting of the
creditors or class of creditors, and/or of the
<PAGE>
<PAGE> 31
stockholders or class of stockholders of this Corporation, as the case may
be, to be summoned in such manner as the said court directs. If a majority
in number representing three-fourths in value of the creditors or class of
creditors, and/or of the stockholders or class of stockholders of this
Corporation, as the case may be, agree to any compromise or arrangement and
to any reorganization of this Corporation as consequence of such compromise
or arrangement, the said compromise or arrangement and the said
reorganization shall, if sanctioned by the court to which the said
application has been made, be binding on all the creditors or class of
creditors, and/or on all the stockholders or class of stockholders, of this
Corporation, as the case may be, and also on this Corporation.
ARTICLE X
Business Combinations
(1) In addition to any affirmative vote required by law or
the Restated Certificate of Incorporation or By-Laws of the Corporation, a
Business Combination shall require a Supermajority Vote (which affirmative
vote shall be required notwithstanding the fact that no vote may be
required, or that a lesser percentage or separate class vote may be
specified, by law or in any agreement with any national securities exchange
or otherwise); provided, however, that such voting requirements shall not
be applicable if:
(a) The Continuing Directors shall have expressly approved,
by the affirmative vote of a majority of such Continuing Directors,
such Business Combination prior to such Business Combination; or
(b) All of the following conditions shall be satisfied:
(i) The consideration to be received by holders of
Voting Stock in the Business Combination shall be in cash or if
the consideration previously paid by or on behalf of the
Related Person in connection with its acquisition of beneficial
ownership of shares of Voting Stock constituted in whole or in
part of consideration other than cash, then in the same form as
such consideration. If such payment for shares of Voting Stock
of the Corporation has been made with varying forms of
consideration, the form of consideration for such Voting Stock
shall be either cash or the form used to acquire the beneficial
ownership of the largest number of shares of Voting Stock
previously acquired by the Related Person;
(ii) After such Related Person shall have first become a
Related Person and prior to the consummation of such Business
Combination:
<PAGE>
<PAGE> 32
(A) Except as approved by the affirmative vote of
a majority of the Continuing Directors, there shall have
been no failure to declare and pay at the regular dates
therefor the full amount of all dividends (whether or not
cumulative) payable on the Preferred Stock or any class
or series of stock having a preference over the Common
Stock as to dividends or upon liquidation; and
(B) There shall have been (x) no reduction in the
annual rate of dividends paid on the Common Stock (except
as necessary to reflect any subdivision of the Common
Stock) except as approved by a majority vote of the
Continuing Directors and (y) an increase in such annual
rate of dividends, to the extent necessary to reflect any
reclassification (including any reverse stock split),
recapitalization, reorganization or any similar
transaction which has the effect of reducing the number
of outstanding shares of Common Stock, unless the failure
so to increase such annual rate shall have been approved
by a majority vote of the Continuing Directors; and
(C) Such Related Person shall not have become the
Beneficial Owner of any additional shares of Voting Stock
except as part of the transaction that results in such
Related Person becoming a Related Person and except in a
transaction that, after giving effect thereto, would not
result in any increase in the Related Person's percentage
beneficial ownership of any class of Voting Stock. The
approval by a majority of the Continuing Directors of any
exception to the requirements set forth in subparagraphs
(A) and (B) hereof shall only be effective for the
purposes of this subparagraph (b) if obtained at a
meeting at which a Continuing Director Quorum is present;
(iii) After such Related Person shall have first become a
Related Person, such Related Person shall not have received the
benefit, directly or indirectly (except proportionately as a
stockholder of the Corporation), of any loans, advances,
guarantees, pledges or other financial assistance or any tax
credits or other tax advantages provided by the Corporation;
and
(iv) a proxy statement describing the proposed Business
Combination and complying with the requirements of the United
States Securities Exchange Act of 1934, as amended, and the
rules and regulations thereunder, or any acts, rules or
regulations which a majority of the Continuing Directors
determine are successors thereto, shall
<PAGE>
<PAGE> 33
(whether or not such a proxy statement is required to be mailed
pursuant to such acts, rules or regulations) have been mailed
to all holders of Voting Stock at least 30 days prior to the
date of the meeting called to consider such Business
Combination and such statement shall have contained, on the
first page thereof, in a prominent place, any recommendation as
to the advisability (or inadvisability) of the Business
Combination that the Continuing Directors, or any of them, may
choose to state and, if deemed advisable by a majority of the
Continuing Directors, the opinion of an investment banking firm
selected, at a meeting at which a Continuing Directors Quorum
is present by a majority of the Continuing Directors, as to the
fairness (or not) of the terms of the Business Combination,
from a financial point of view of the holders of the
outstanding shares of capital stock of the Corporation other
than the Related Person and its Affiliates or Associates (such
investment banking firm to be paid a reasonable fee for its
services by the Corporation).
Notwithstanding any of the foregoing, however, the Corporation may not
enter into any Business Combination unless the Fair Market Value of the
consideration to be received per share by holders of Voting Stock in the
Business Combination before the date of the consummation of such Business
Combination is at least equal to the Highest Per Share Price.
(2) Notwithstanding anything to the contrary in this Article
X or in any corporation law which may be applicable, in the event the
Corporation merges, consolidates with or otherwise reorganizes itself
(including by reincorporation), or sells all or substantially all its
assets to, a Person except in an arm's length transaction and to a Person
that is not an Affiliate, such a transaction will require the affirmative
vote of 662/3% of the Voting Stock unless the Certificate of Incorporation
or By-Laws of the surviving corporation after any such merger,
consolidation or reorganization is identical to that of the Corporation as
of the effective date of any such merger, consolidation or reorganization.
(3) For the purposes of Article X.1.and X.2., the following
definitions shall apply:
(a) The terms "Affiliate" and "Associate" shall have the
respective meanings ascribed to such terms in Rule 12b-2 of the
General Rules and Regulations under the Securities Exchange Act of
1934, as amended, as in effect at the date of the adoption of this
Article IX (the term "registrant" in said Rule 12b-2 meaning in this
case the Corporation).
(b) The term "Beneficial Owner" shall mean any Person (i)
that beneficially owns any Voting Stock within the meaning ascribed
in Rule 13d-3 of
<PAGE>
<PAGE> 34
the General Rules and Regulations under the Securities Exchange Act
of 1934, as amended, or (ii) that has (x) the right to acquire any
such beneficial ownership (whether or not such right is exercisable
immediately, with the passage of time or subject to any condition)
pursuant to any agreement, contract, arrangement or understanding or
upon the exercise of any conversion, exchange or other right, warrant
or option, or otherwise, or (y) the right to vote pursuant to any
agreement, arrangement or understanding. A Person shall be deemed the
Beneficial Owner of all Voting Stock of which any Affiliate or
Associate of such Person is the Beneficial Owner.
(c) The term "Business Combination" shall mean
(i) any merger or consolidation of the Corporation or
any Subsidiary with (a) any Related Person, or (b) any other
corporation (whether or not itself a Related Person) which is,
or after such merger or consolidation would be, an Affiliate or
Associate of a Related Person; or
(ii) any sale, lease, exchange, mortgage, pledge,
transfer or other disposition (in one transaction or a series
of transactions) by or to any Related Person, or any Affiliate
or Associate of any Related Person, involving any assets or
securities of the Corporation, any Subsidiary or any Related
Person, or any Affiliate or Associate of any Related Person,
having an aggregate Fair Market Value of $25,000,000 or more;
or
(iii) the issuance or transfer by the Corporation or any
Subsidiary (in the transaction or a series of transactions) of
any securities of the Corporation or any Subsidiary to any
Related Person or any Affiliate of any Related Person, other
than the issuance on a pro rata basis to all holders of stock
of the same class pursuant to a stock split or stock dividend;
or
(iv) the adoption of any plan or proposal for the
liquidation or dissolution of the Corporation proposed by or on
behalf of a Related Person or any Affiliate or Associate of any
Related Person; or
(v) any reclassification of securities (including any
reverse stock split), or recapitalization of the Corporation,
or any merger or consolidation of the Corporation with any of
its Subsidiaries or any other transaction (whether or not with
or otherwise involving a Related Person) that has the effect,
directly or indirectly, of increasing the proportionate share
of any class of equity or convertible securities of the
Corporation or any Subsidiary which is directly or indirectly
beneficially owned by any Related Person or any Affiliate or
Associate of any Related Person; or
<PAGE>
<PAGE> 35
(vi) any loan, advance, guaranty, pledge or other
financial assistance by the Corporation or any Subsidiary to or
for the benefit, directly or indirectly (except
proportionately as a stockholder), of a Related Person; or
(vii) any agreement, contract or other arrangement
providing for any one or more of the actions specified in
clauses (i) to (vi) of this subparagraph b(3); or
(viii) any series of transactions which a majority
of Continuing Directors determine are related and which, taken
together, would constitute a Business Combination.
(d) The term "Continuing Director" shall mean a Director of
the Corporation who is not an Affiliate or Associate of the Related
Person involved in the relevant Business Combination and either (i)
who was a member of the Board of Directors of the Corporation
immediately prior to the time that such Related Person became a
Related Person or (ii) whose initial election as a Director of the
Corporation was recommended by the affirmative vote of a majority of
the Continuing Directors then in office; provided, however, that in
either such case, such Continuing Director shall have continued in
office after first becoming a Continuing Director.
(e) The term "Continuing Director Quorum" shall mean at least
60% of the number of Continuing Directors capable of exercising the
powers conferred upon them under the provisions of the Restated
Certificate of Incorporation or By-Laws of the Corporation or by law.
(f) The term "Fair Market Value" shall mean (i) in the case
of United States currency, the amount thereof, (ii) in the case of
stock, (x) the highest closing sale price per share thereof, during
the 30 trading days preceding the date as of which the determination
thereof is to be made, on the Composite Tape for New York Stock
Exchange-Listed Stocks or, if such stock is not listed on such
exchange, on the New York Stock Exchange, or if such stock is not
listed on such exchange, on the United States securities exchange
registered as a national securities exchange under the Securities Act
of 1934, as amended, on which such stock is listed and principally
traded, (y) if such stock is not so listed, the highest closing bid
quotation per share thereof, during the 30 trading days preceding the
date as of which the determination thereof is to be made, on the
National Association of Securities Dealers, Inc. Automated Quotation
System, or any system then in use or (z) if no such quotations are
then available, the fair market value thereof, as of the date as of
which the determination thereof is to be made, as determined by a
majority vote of the Continuing Directors and (iii) in the case
<PAGE>
<PAGE> 36
of securities, property or assets other than such currency or stock,
the fair market value thereof, as of the date as of which the
determination is to be made, as determined by a majority vote of the
Continuing Directors.
(g) The term "Highest Per Share Price" shall mean with
respect to any class or series of Voting Stock of the Corporation the
highest of (i) the highest price that can be determined, by a
majority of the Continuing Directors, to have been paid at any time
by or on behalf of the Related Person for any share or shares of such
class or series of Voting Stock or, if such Related Person has not
acquired any Voting Stock of such class or series, the highest
equivalent, as determined by a majority vote of the Continuing
Directors, for a share of such class or series of such highest price
for any other class or series of Voting Stock, (ii) the Fair Market
Value per share of such Voting Stock, as determined by a majority of
the Continuing Directors, immediately prior to the time at which the
relevant Business Combination shall first have been publicly
announced or at which (iii) the highest preferential amount, if any,
per share payable with respect to such Voting Stock in the event of a
voluntary or involuntary liquidation of the Corporation. In
determining the Highest Per Share Price for any Voting Stock (i) all
purchases by the Related Person shall be taken into account
regardless of whether the shares were purchased before or after the
Related Person becomes a Related Person, and (ii) the Highest Per
Share Price shall include any brokerage commissions, transfer taxes
and soliciting dealers' fees or other value paid in connection with
such purchases. The Continuing Directors shall determine, by a
majority vote, the Highest Per Share Price for each outstanding class
and series of the Voting Stock in connection with any Business
Combination which is subject to the voting requirement of paragraph
(1) of this Article X.
A Related Person shall be deemed to have acquired a share of
Voting Stock at the time when such Related Person became the
Beneficial Owner thereof. The price deemed to have been paid by a
Related Person for Voting Stock of which an Affiliate or Associate is
the Beneficial Owner shall be the price, as determined by a majority
vote of the Continuing Directors, which is the highest of (i) the
price paid upon the acquisition thereof by the relevant Affiliate or
Associate (if any, and whether or not such Affiliate or Associate was
an Affiliate or Associate at the time of such acquisition), (ii) the
Fair Market Value of such Voting Stock at the time when the Related
Person became the Beneficial Owner thereof and (iii) the highest
price previously paid by such Related Person or an Affiliate or
Associate thereof for such Voting Stock.
In any determination of the Highest Per Share Price or the
price or prices paid or deemed to have been paid by any Person,
appropriate adjustment shall be made to reflect the relevant effect
of any stock dividends, splits and distributions and any combination
or reclassification of capital stock.
<PAGE>
<PAGE> 37
(h) The term "other consideration to be received" shall, in
the event of a Business Combination which is a merger and in which
the Corporation is the surviving corporation, include, without
limitation, capital stock of the Corporation to be retained by the
holders thereof other than the Related Person.
(i) The term "Person" shall mean any individual, corporation,
partnership or other entity, including any group comprised of any
Person and any other Person, or any Affiliate or Associate thereof,
with whom such Person, or any Affiliate or Associate thereof, has any
agreement, arrangement or understanding, directly or indirectly, for
the purpose of acquiring, holding, voting or disposing of Voting
Stock and each Person, and any Affiliate or Associate thereof, which
is a member of such group.
(j) The term "Related Person" shall mean (i) any Person
(other than the Corporation or any Subsidiary and other than any
profit-sharing employee stock ownership or other employee benefit
plan of the Corporation or any Subsidiary or any trustee or fiduciary
with respect to any such plan when acting in such capacity) who,
together with its Affiliates and Associates, is or shall become the
Beneficial Owner of an aggregate of 15% or more of the outstanding
Voting Stock of the Corporation, (ii) is an Affiliate or Associate of
any such Person and (iii) shall become, in a transaction or series of
transactions not involving a public offering within the meaning of
the Securities Act of 1933, as amended, the Beneficial Owner of
Voting Stock of which a Related Person was the Beneficial Owner at
any time during the two years prior to the time such Person or
Affiliate or Associate became such Beneficial Owner.
(k) The term "Subsidiary" means any Person a majority of the
capital stock of or other equity interest in which is owned by the
Corporation, one or more Subsidiaries of the Corporation or the
Corporation and one or more Subsidiaries of the Corporation.
(4) A majority of the Continuing Directors shall have the
power to make any and all determinations provided in this Article X and to
interpret the provisions of and definitions in this Article X, which
determinations and interpretations shall, to the fullest extent permitted
by law, be conclusive, except as a majority of the Continuing Directors may
otherwise determine.
ARTICLE XI
Amendment
<PAGE>
<PAGE> 38
The Corporation reserves the right to amend, alter, change or
repeal any provision contained in this Restated Certificate of
Incorporation, in the manner now or hereafter prescribed by the General
Corporation Law, and all rights conferred upon stockholders herein are
granted subject to this reservation; provided, however, that (i) no
amendment, alteration, change or repeal in any respect of any provision of
Article I, Article X or clause (i) of this Article XI hereof may be made by
the stockholders of the Corporation, and no provision inconsistent
therewith may be so adopted, without the affirmative vote of 80% of all the
Directors and a Supermajority Vote; and (ii) no amendment, alteration,
change or repeal in any respect of any provision of paragraph (3) of
Article V or paragraph (2) of Article VIII hereof may be proposed to the
stockholders by the Directors, and no provision inconsistent therewith may
be proposed for amendment, without the affirmative vote of 80% of all the
Directors.
<PAGE>
Exhibit 4.2
RESTATED
BY-LAWS
OF
PHARMACIA & UPJOHN, INC.
Adopted and Effective November 2, 1995
<PAGE>
<PAGE> 1
AMENDED
BY-LAWS
OF
PHARMACIA & UPJOHN, INC.
ARTICLE I
OFFICES
SECTION 1.01. Registered Office. The registered office of
Pharmacia & Upjohn, Inc. (the "Corporation") in the State of Delaware shall
be at the principal office of The Corporation Trust Corporation in the City
of Wilmington, County of New Castle, and the registered agent in charge
thereof shall be The Corporation Trust Corporation.
SECTION 1.02. Other Offices. The Corporation shall establish
and maintain its global corporate management center in or proximate to
London, England and shall maintain regional headquarters in Kalamazoo,
Michigan, U.S.A., and Stockholm, Sweden. The Corporation may also have an
office or offices at any other place or places within or without the State
of Delaware as the Board of Directors of the Corporation (the "Board") may
from time to time determine or the business of the Corporation may from
time to time require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
SECTION 2.01. Annual Meetings. (a) The annual meeting of
record holders (a "Stockholder") of shares of the Corporation issued and
outstanding (the "Shares") of the Corporation shall be held on such other
day following, or on such date as shall be set forth in the notice of
annual meeting approved by the Board and provided to Stockholders.
(b) The annual meeting of the Stockholders for 1996 shall be
held in either Sweden or the U.S., as determined by the Board of Directors,
and thereafter the location of the annual meetings shall alternate between
Sweden and the United States. Wherever located, provision shall be made
for Stockholders located in the other location to participate in the annual
meeting by means of conference telephone or similar
<PAGE>
<PAGE> 2
communications equipment by means of which all persons participating in the
meeting can hear each other.
(c) At any such annual meeting, only such business shall be
conducted as shall have been brought before the meeting (x) by or at the
direction of the Board or (y) by any Stockholder entitled to vote thereat
that complies with the procedures set forth in Section 2.02 hereof.
SECTION 2.02. Stockholder Proposals and Nominations for
Directors. (a) Any Stockholder entitled to vote at such annual meeting
may propose business (other than nominations for the election of Directors
of the Corporation (the "Directors") to be included in the agenda of such
meeting only if written notice of such Stockholder's intent is given to the
Secretary of the Corporation (the "Secretary"), either personally or by
mail, postage prepaid, not earlier than 90 days nor later than 60 days in
advance of the anniversary of the date of the immediately preceding annual
meeting or if the date of the annual meeting occurs more than 30 days
before or 60 days after the anniversary of such immediately preceding
annual meeting, not later than the close of business on the later of (A)
the sixtieth day prior to such annual meeting and (B) the tenth day
following the date on which public announcement of the date of such meeting
is first made. A Stockholder's notice to the Secretary shall set forth in
writing as to each business matter such Stockholder proposes to bring
before the annual meeting (A) a brief description of the business desired
to be brought before the annual meeting and the reasons for conducting such
business at the annual meeting, (B) the name and address, as they appear on
the Corporation's books, of the Stockholder proposing such business, (C)
the class and number of Shares that are beneficially owned by the
Stockholder, and (D) any material interest of the Stockholder in such
business. Notwithstanding anything in these By-Laws to the contrary, no
business shall be conducted at an annual meeting except in accordance with
the procedures set forth in this Section 2.02(a). The officer of the
Corporation or other person presiding at the annual meeting shall, if the
facts so warrant, determine and declare to the meeting that business was
not properly brought before the meeting in accordance with the provisions
of this Section 2.02(a), and, if he or she should so determine, he or she
shall so declare to the meeting and any such business not properly brought
before the meeting shall not be transacted.
(b) Nominations for the election of Directors may be made by
the Board or any Stockholder entitled to vote for the election of
Directors. Any Stockholder entitled to vote for the election of Directors
at the annual meeting of the
<PAGE>
<PAGE> 3
Stockholders of the Corporation, may nominate a person or persons for
election as a Director only if written notice of such Stockholder's intent
to make such nomination is given to the Secretary in accordance with the
procedures set forth in this Section 2.02(a). Each such notice shall set
forth the name and address of the Stockholder who intends to make the
nomination and of the person or persons to be nominated for election as a
Director; a representation that the Stockholder is a holder of record of
Shares of the Corporation entitled to vote at such meeting and intends to
appear in person or by proxy at the meeting to nominate the person or
persons specified in the notice; a description of all arrangements or
understandings between the Stockholder and each nominee and any other
person or persons (naming such person or persons) pursuant to which the
nomination or nominations for election as a Director are to be amended by
the Stockholder; such other information regarding each nominee proposed by
such Stockholder as would have been required to be included in a proxy
statement filed pursuant to the proxy rules of the United States Securities
and Exchange Commission (the "SEC") if such nominee had been nominated, or
was intended to be nominated, for election as a Director by the Board; and
the consent of each nominee to serve as a Director of the Corporation if so
elected. The Board may refuse to acknowledge the nomination of any person
not made in compliance with the foregoing procedures.
(c) For purposes of this Section 2.02, "public announcement"
shall mean disclosure in a press release reported by the Dow Jones News
Service, Associated Press or a comparable Swedish or United States news
service or in a document publicly filed by the Corporation with the
Stockholm Stock Exchange (the "SSE") and the SEC pursuant to Section 13, 14
or 15(d) of the United States Securities Exchange Act of 1934, as amended.
SECTION 2.03. Special Meetings. Special meetings of
Stockholders for any purpose or purposes may be called by the Chairman of
the Board (the "Chairman"), the President and Chief Executive Officer, or a
majority of the Directors.
SECTION 2.04. Notice of Meetings. Except as otherwise
provided by law, written notice of each annual or special meeting of
Stockholders stating the place, date and time of such meeting and, in the
case of a special meeting, the purpose or purposes for which such meeting
is to be held, shall be given by first class mail (airmail in the case of
international communications) by the Corporation to the Stockholders not
less than 10 nor more than 60 days before the date of such meeting. The
Corporation shall use all
<PAGE>
<PAGE> 4
reasonable efforts to cause the bank acting as the depositary (the
"Depositary") with respect to the Swedish Depositary Shares representing
shares of common stock of the Corporation (the "SDSs") or its designee to
mail such notice in Sweden to record holders (the "Swedish Holders") of
SDSs. If mailed, such notice shall be deemed to be given when deposited in
the United States or (in the case of mailing by the Depositary) Swedish
mail, postage prepaid, directed to the Stockholder or Swedish Holder at
such Stockholder or Swedish Holder's address as it appears on the records
of the Corporation or the Depositary, as the case may be.
SECTION 2.05. Waiver of Notice. Notice of any annual or
special meeting of Stockholders need not be given to any Stockholder that
files a written waiver of notice with the Secretary, signed by the person
entitled to notice, whether before or after such meeting. Neither the
business to be transacted at, nor the purpose of, any meeting of
Stockholders need be specified in any written waiver of notice thereof.
Attendance of a Stockholder at a meeting, in person or by proxy, shall
constitute a waiver of notice of such meeting, except when such Stockholder
attends a meeting for the express purpose of objecting, at the beginning of
the meeting, to the transaction of any business on the grounds that the
notice of such meeting was inadequate or improperly given.
SECTION 2.06. Adjournments. Whenever a meeting of
Stockholders, annual or special, is adjourned to another date, time or
place, notice need not be given of the adjourned meeting if the date, time
and place thereof are announced at the meeting at which the adjournment is
taken. If the adjournment is for more than 30 days, or if after the
adjournment a new record date is fixed for the adjourned meeting, a notice
of the adjourned meeting shall be given to each Stockholder entitled to
vote thereat. At the adjourned meeting, any business may be transacted
which might have been transacted at the original meeting.
SECTION 2.07. Quorum. Except as otherwise provided by law or
the Certificate of Incorporation of the Corporation, as the same may be
amended and/or restated from time to time (the "Certificate of
Incorporation") or elsewhere in these By-Laws, the record holders of a
majority of the Shares of the Corporation entitled to vote thereat, present
in person or by proxy, shall constitute a quorum for the transaction of
business at all meetings of Stockholders, whether annual or special. If,
however, such quorum shall not be present in person or by proxy at any
meeting of Stockholders, the Stockholders entitled to vote thereat may
adjourn the meeting
<PAGE>
<PAGE> 5
from time to time in accordance with Section 2.05 hereof until a quorum
shall be present in person or by proxy.
SECTION 2.08. Voting. Except as otherwise provided in the
Certificate of Incorporation, each Stockholder shall be entitled to one
vote for each Share held by such Stockholder. Except as otherwise provided
by law or the Certificate of Incorporation or these By-Laws, when a quorum
is present at any meeting of Stockholders, the vote of the record holders
of a majority of the Shares constituting such quorum shall decide any
question brought before such meeting. Voting at any meeting of the
Stockholders need not be by written ballot unless the holders of a majority
of the Shares present in person or by proxy at such meeting shall so
determine.
SECTION 2.09. Proxies. Each Stockholder entitled to vote at a
meeting of Stockholders may authorize another person or persons to act for
such Stockholder by proxy. Such proxy shall be filed with the Secretary
before such meeting of Stockholders, at such time as the Board may require.
No proxy shall be voted or acted upon more than three years from its date,
unless the proxy provides for a longer period.
SECTION 2.10. No Stockholders' Consent in Lieu of Meeting.
Any action required or permitted to be taken by the Stockholders of the
Corporation must be effected at a duly called annual meeting or special
meeting of such Stockholders and may not be effected by any consent in
writing by any such Stockholders.
SECTION 2.11. Organization. Meetings of Stockholders shall be
presided over by the Chairman, or in the absence of the Chairman by the
President and Chief Executive Officer, or in the absence of the President
and Chief Executive Officer by an Executive Vice President, or in the
absence of the foregoing persons by a chairman designated by the Board, or
in the absence of such designation by a chairman chosen at the meeting.
The Secretary of the Corporation (the "Secretary"), or in the absence of
the Secretary an Assistant Secretary, shall act as secretary of the
meeting, but in the absence of the Secretary and any Assistant Secretary
the chairman of the meeting may appoint any person to act as secretary of
the meeting.
SECTION 2.12. Inspectors. Prior to any meeting of
Stockholders, the Board or the President and Chief Executive Officer shall
appoint one or more inspectors to act at such meeting and make a written
report thereof and may designate one or more persons as alternate
inspectors to replace any inspector who fails to act. If no inspector or
alternate is
<PAGE>
<PAGE> 6
able to act at the meeting of Stockholders, the person presiding at the
meeting shall appoint one or more inspectors to act at the meeting. Each
inspector, before entering upon the discharge of his or her duties, shall
take and sign an oath faithfully to execute the duties of inspector with
strict impartiality and according to the best of his or her ability. The
inspectors shall ascertain the number of Shares and the voting power of
each, determine the Shares represented at the meeting and the validity of
proxies and ballots, count all votes and ballots, determine and retain for
a reasonable period a record of the disposition of any challenges made to
any determination by the inspectors and certify their determination of the
number of Shares represented at the meeting and their count of all votes
and ballots. The inspectors may appoint or retain other persons to assist
them in the performance of their duties. The date and time of the opening
and closing of the polls for each matter upon which the Stockholders will
vote at a meeting shall be announced at the meeting. No ballot, proxy or
vote, nor any revocation thereof or change thereto, shall be accepted by
the inspectors after the closing of the polls. In determining the validity
and counting of proxies and ballots, the inspectors shall be limited to an
examination of the proxies, any envelopes submitted therewith, any
information provided by a Stockholder who submits a proxy by telegram,
cablegram or other electronic transmission from which it can be determined
that the proxy was authorized by the Stockholder, ballots and the regular
books and records of the Corporation, and they may also consider other
reliable information for the limited purpose of reconciling proxies and
ballots submitted by or on behalf of banks, brokers, their nominees or
similar persons which represent more votes than the holder of a proxy is
authorized by the record owner to cast or more votes than the Stockholder
holds of record. If the inspectors consider other reliable information for
such purpose, they shall, at the time they make their certification,
specify the precise information considered by them, including the person or
persons from whom they obtained the information, when the information was
obtained, the means by which the information was obtained and the basis for
the inspectors' belief that such information is accurate and reliable.
SECTION 2.13. Fixing Date for Determination of Stockholders of
Record. In order that the Corporation may determine the Stockholders
entitled to notice of or to vote at any meeting of Stockholders or any
adjournment thereof, the Board may fix a record date, which record date
shall not precede the date upon which the resolution fixing the record date
is adopted by the Board, and which record date shall not be more than 60
nor less than 10 days before the date of such
<PAGE>
<PAGE> 7
meeting. If no record date is fixed by the Board, the record date for
determining Stockholders entitled to notice of or to vote at a meeting of
Stockholders shall be at the close of business on the day next preceding
the day on which notice is given, or, if notice is waived, at the close of
business on the day next preceding the day on which the meeting is held. A
determination of Stockholders of record entitled to notice of or to vote at
a meeting of Stockholders shall apply to any adjournment of the meeting;
provided, however, that the Board may fix a new record date for the
adjourned meeting.
In order that the Corporation may determine the Stockholders
entitled to receive payment of any dividend or other distribution or
allotment of any rights or the Stockholders entitled to exercise any rights
in respect of any change, conversion or exchange of stock, or for the
purpose of any other lawful action, the Board may fix a record date, which
record date shall not precede the date upon which the resolution fixing the
record date is adopted, and which record date shall be not more than 60
days prior to such action. If no record date is fixed, the record date for
determining Stockholders for any such purpose shall be at the close of
business on the day on which the Board adopts the resolution relating
thereto.
SECTION 2.14. List of Stockholders Entitled to Vote. The
Secretary shall prepare and make, at least 10 days before every meeting of
Stockholders, a complete list of the Stockholders entitled to vote at the
meeting, arranged in alphabetical order, and showing the address of each
Stockholder and the number of Shares registered in the name of each
Stockholder. Such list shall be open to the examination of any
Stockholder, for any purpose germane to the meeting, during ordinary
business hours, for a period of at least 10 days prior to the meeting,
either at a place within the city where the meeting is to be held, which
place shall be specified in the notice of the meeting, or, if not so
specified, at the place where the meeting is to be held. The list shall
also be produced and kept at the time and place of the meeting during the
whole time thereof and may be inspected by any Stockholder who is present.
ARTICLE III
BOARD OF DIRECTORS
SECTION 3.01. General Powers. The business and affairs of the
Corporation shall be managed by the Board, which may exercise all such
powers of the Corporation and do
<PAGE>
<PAGE> 8
all such lawful acts and things as are not by law, the Certificate of
Incorporation or these By-Laws directed or required to be exercised or done
by Stockholders.
SECTION 3.02. Number and Term of Office. The number of
Directors shall not be less than eight nor more than sixteen, with the
number fixed from time to time by the Board. At least half of the
Directors shall be independent Directors as such term is used in Rule 303
of the Rules of the New York Stock Exchange as in existence on the date
hereof, or as amended from time to time hereafter (the "Independent
Directors"). Directors need not be Stockholders. Until the election of
Directors at the annual meeting of Stockholders held in 2001, one-half of
the Directors shall be citizens of Canada or the United States (the "U.S.
Directors") and one-half of the Directors shall be nationals of Sweden or
member states of the European Union (the "European Directors"). The Board
shall be divided into three classes, each class to have, as near as may be
possible, an equal number of Directors and an equal number of U.S.
Directors and European Directors such that, although each class may not
have equal numbers of U.S. Directors and European Directors, the Board
shall include an equal number of U.S. Directors and European Directors.
The term of office of Directors of the first class shall expire at the
annual meeting of Stockholders held in 1996; the term of office of
Directors of the second class shall expire at the annual meeting of
Stockholders held in 1997; and the term of office of Directors of the third
class shall expire at the annual meeting of Stockholders held in 1998.
Except as otherwise required by law, the Certificate of Incorporation or
these By-Laws, the Directors shall be elected at an annual meeting of the
Stockholders at which a quorum is present. Directors shall be elected by a
plurality of the votes of the Shares present in person or represented by
proxy and entitled to vote on the election of Directors. At each annual
meeting of Stockholders, Directors of the class whose term then expires
shall be elected for a full term of three years to succeed the Directors of
such class, so that the term of office of the Directors of one class shall
expire in each year; provided, however, that nothing herein shall be
construed to prevent (i) the election of a Director to succeed him or
herself, or (ii) the election of a Director for the remainder of an
unexpired term in the class of Directors to which he or she is elected.
SECTION 3.03. The Chairman. (a) (i) Until the annual meeting
of Stockholders at which Directors are elected in 2001, the Chairman and
the President and Chief Executive Officer may not both be citizens of
Canada or the United States and may not both be nationals of Sweden or
member
<PAGE>
<PAGE> 9
states of the European Union, and (ii) the Chairman and the President and
Chief Executive Officer may not be the same person unless otherwise
approved by 80% of the Directors.
(b) The Chairman shall have authority to sign and acknowledge
in the name and on behalf of the Corporation all stock certificates,
contracts or other documents and instruments except when the signing
thereof shall be expressly delegated to an officer or agent by the Board or
required by law to be otherwise signed or executed and, unless otherwise
provided by law or by the Board shall authorize any officer, employee or
agent of the Corporation to sign, execute and acknowledge in his or her
place and stead all such documents and instruments.
(c) The Chairman shall be a non-executive chairman of the
Board who shall devote such time as may be required to fulfill his or her
obligations as Chairman. The Chairman may hold such responsibilities with
respect to the governance of the Corporation as from time to time may be
assigned by the Board or the Executive Committee. In addition, the
Chairman may serve as a paid consultant to the Corporation.
SECTION 3.04. Mandatory Retirement. No Director of the
Corporation shall continue to remain a Director beyond the annual meeting
of Stockholders at which Directors are elected next following or coinciding
with his or her attaining age 70; provided, however, that any Director who
is a Director at the time these By-Laws first become effective may continue
to remain a Director until the first day of the month following or
coinciding with his or her attaining age 72.
SECTION 3.05. Resignation. Any Director may resign at any
time by giving written notice to the Board, the Chairman or the Secretary.
Such resignation shall take effect at the time specified in such notice or,
if the time be not specified, upon receipt thereof by the Board, the
Chairman or the Secretary, as the case may be. Unless otherwise specified
therein, acceptance of such resignation shall not be necessary to make it
effective.
SECTION 3.06. Removal. Any or all of the Directors may be
removed for due cause by vote of the record holders of a majority of the
holders of Shares entitled to vote thereon at a meeting of the
Stockholders; provided, however, that no such removal can be made at such
meeting unless the notice thereof specifies such removal and the reasons
therefor as one of the matters that will be considered at said meeting.
<PAGE>
<PAGE> 10
SECTION 3.07. Vacancies. Newly created directorships
resulting from any increase in the number of Directors and any vacancies on
the Board resulting from death, resignation, disqualification, removal, or
other cause shall be filled solely by the affirmative vote of a majority of
the remaining Directors then in office, even though less than a quorum. Any
Director elected in accordance with the preceding sentence shall hold
office for the remainder of the full term of the class of Directors in
which the new directorship was created or the vacancy occurred and until
such Director's successor shall have been elected and qualified. No
decrease in the number of Directors constituting the Board shall shorten
the term of any incumbent Director.
SECTION 3.08. Meetings. (a) Annual Meetings. As soon as
practicable after each annual election of Directors by the Stockholders,
the Board shall meet for the purpose of organization, election of a
Chairman and officers of the Corporation, and the transaction of other
business, unless it shall have transacted all such business by written
consent pursuant to Section 3.09 hereof.
(b) Other Meetings. Other meetings of the Board shall be
held at such times as the Chairman, the President and Chief Executive
Officer, the Secretary, and any two European Directors or two U.S.
Directors shall from time to time determine.
(c) Notice of Meetings. The Secretary shall give written
notice to each Director of each meeting of the Board, which notice shall
state the place, date, time and purpose of such meeting. Notice of each
such meeting shall be given to each Director, if by mail, addressed to him
or her at his or her residence or usual place of business, at least five
days before the day on which such meeting is to be held, or shall be sent
to him or her at such place by telecopy, telegraph, cable, or other form of
recorded communication, or be delivered personally or by telephone not
later than three days before the day on which such meeting is to be held.
A written waiver of notice, signed by the Director entitled to notice,
whether before or after the time of the meeting referred to in such waiver,
shall be deemed equivalent to notice. Neither the business to be
transacted at, nor the purpose of any meeting of the Board need be
specified in any written waiver of notice thereof. Attendance of a
Director at a meeting of the Board shall constitute a waiver of notice of
such meeting, except as provided by law.
(d) Quorum and Manner of Acting. Except as otherwise
required by law, the Certificate of Incorporation or
<PAGE>
<PAGE> 11
these By-Laws, a majority of the Directors then in office shall constitute
a quorum at any meeting of the Board, and the Board shall act only when a
quorum is present. Except as otherwise provided in these By-Laws, a
majority of the quorum shall decide any questions that come before the
meeting.
(e) Place of Meetings. The Board may hold its meetings at
such place or places within or without the State of Delaware as the Board
or the Chairman may from time to time determine, or as shall be designated
in the respective notices or waivers of notice of such meetings.
(f) Organization. At each meeting of the Board, the Chairman
or, in his or her absence, the President and Chief Executive Officer or, if
both of such persons are absent, a chairman chosen by a majority of the
Directors present shall act as chairman of the meeting. The Secretary, or
in the absence of the Secretary an Assistant Secretary, shall act as
secretary of the meeting, but in the absence of the Secretary and any
Assistant Secretary the chairman of the meeting may appoint any person to
act as secretary of the meeting.
SECTION 3.09. Directors' Consent in Lieu of Meeting. Any
action required or permitted to be taken at any meeting of the Board or of
any committee thereof may be taken without a meeting, without prior notice
and without a vote, if a consent in writing, setting forth the action so
taken, shall be signed by all the members of the Board or such committee
and such consent is filed with the minutes of the proceedings of the Board
or such committee.
SECTION 3.10. Action by Means of Telephone or Similar
Communications Equipment. In accordance with standards established by the
Executive Committee, any one or more members of the Board, or of any
committee thereof, may participate in a meeting of the Board or such
committee by means of conference telephone or similar communications
equipment by means of which all persons participating in the meeting can
hear each other, and participation in a meeting by such means shall
constitute presence in person at such meeting.
SECTION 3.11. Compensation. Unless otherwise restricted by
the Certificate of Incorporation, the Board may determine the compensation
of Directors. In addition, as determined by the Board, Directors may be
reimbursed by the Corporation for their expenses, if any, in the
performance of their duties as Directors. No such compensation or
reimbursement shall preclude any Director from serving the
<PAGE>
<PAGE> 12
Corporation in any other capacity and receiving compensation therefor.
ARTICLE IV
COMMITTEES
SECTION 4.01. Executive Committee. The Board may, in its
discretion, designate annually an Executive Committee (the "Executive
Committee") consisting of any even number of Directors, but in any event
not fewer than four Directors as it may from time to time determine. The
Executive Committee shall review and, when appropriate, refer to the Board
for decision, matters related to the Corporation's financial policy and
planning, material financial transactions, matters of public and social
policy affecting the Corporation and such other matters as may be
designated by the Chairman or the President and Chief Executive Officer.
The committee shall have and may exercise all the powers and authority of
the Board in the management of the business and affairs of the Corporation
and may authorize the seal of the Corporation to be affixed to all papers
which may require it, but the committee shall have no power or authority to
amend the Restated Certificate of Incorporation (except that the committee
may, to the extent authorized in the resolution or resolutions providing
for the issuance of any shares of the Corporation adopted by the Board, fix
any of the preferences or rights of such shares relating to dividends,
redemption, dissolution, any distribution of assets of the Corporation or
the conversion into, for the exchange of such shares for shares of any
other class or classes or any other series of the same or any other class
or classes of stock of the Corporation), adopt an agreement of merger or
consolidation, recommend to the Stockholders the sale, lease or exchange of
all or substantially all of the Corporation's property and assets,
recommend to the Stockholders a dissolution of the Corporation or a
revocation of a dissolution, amend the By-Laws of the Corporation, elect
officers or fill vacancies on the Board or any committee of the Board,
declare a dividend, authorize the issuance of stock, or such other powers
as the Board may from time to time eliminate. The Executive Committee
shall report its activities to the Board on a regular basis.
SECTION 4.02. Audit Committee. The Board shall designate
annually an Audit Committee (the "Audit Committee") consisting of an even
number of Directors, but in any event not fewer than four Directors as it
may from time to time determine, all of whom shall be Independent
Directors, to
<PAGE>
<PAGE> 13
assist the Board in fulfilling its responsibilities with respect to
overseeing the accounting, auditing and financial reporting practices and
the internal control policies and procedures of the Corporation.
Specifically, the Audit Committee is authorized and directed on
behalf of the Board to:
(a) Review with the independent accountants the Corporation's
financial statements, basic accounting and financial policies and
practices, competency or control personnel, standard and special
tests used in verifying the Corporation's statements of account and
in determining the soundness of the Corporation's financial condition
and report to the Board the results of such reviews.
(b) Review the policies and practices pertaining to
publication of quarterly and annual statements to assure consistency
with audited results and the implementing of policies and practices
recommended by the independent accountants.
(c) Ensure that suitable independent audits are made of the
operations and results of subsidiary Corporations and affiliates.
(d) Review and approve the audit program to be conducted by
the Corporation's internal auditors and the results of completed
audits.
(e) Review the nature of, and fees charged for, all audit and
non-audit services performed by the Corporation's independent
auditing firm.
(f) Employ, at its discretion, independent auditors and legal
counsel, at the expense of the Corporation, to assist the committee
in performing the responsibilities delegated to it in this section
and conduct any additional reviews, discussions or investigations
which in its discretion would be of assistance in fulfilling its
responsibilities under this section.
(g) Monitor compliance with the Corporation's code of
business conduct, and such other duties, functions and powers as the
Board may from time to time prescribe.
<PAGE>
<PAGE> 14
SECTION 4.03. Compensation Committee. The Board may, in its
discretion, designate annually a Compensation Committee (the "Compensation
Committee") consisting of an even number of Directors, but in any event not
fewer than four Directors, as it may from time to time determine. The
Compensation Committee shall review, report and make recommendations to the
Board on the following matters:
(a) The compensation arrangements for Directors and corporate
officers of the Corporation and its principal operating subsidiaries
following an annual review of management's recommendations for the
individuals involved. If circumstances involving individuals require
a salary adjustment between such reviews, a recommendation may be
made directly to the Board by the President and Chief Executive
Officer without the necessity of a meeting of the Compensation
Committee.
(b) Management recommendations for individual stock options
to be granted under existing stock option plans to key executives of
the Corporation and its subsidiary companies.
(c) The performance of corporate officers of the Corporation
and its principal operating subsidiaries.
(d) Any proposed stock option plans, stock purchase plans,
retirement plans and any other plans, systems and practices of the
Corporation relating to the compensation of any employees of the
Corporation, any proposed plans of any subsidiary company involving
the issuance or purchase of capital stock of the Corporation.
(e) Such other matters as the Board may from time to time
prescribe.
SECTION 4.04. Nominating Committee. The Board may, in its
discretion, designate annually a Nominating Committee (the "Nominating
Committee") consisting of an even number of Directors, but in any event not
fewer than four Directors, as it may from time to time determine. The
Nominating Committee shall review, report and make recommendations to the
Board on the following matters:
(a) The size and composition of the Board; nominees for
Directors; selection criteria for Directors; removal of Directors if
deemed appropriate; Board committee charters; members and
chairpersons; evaluation and performance of the Board and individual
Directors.
<PAGE>
<PAGE> 15
(b) After consultation with management, selection and
recommendation to the Board of appropriate individuals for election,
appointment and promotion as officers of the Corporation with a view
to ensuring the continuity of able, capable management; plans for
management succession and individual development plans.
(c) Corporate governance policies, procedures and practices.
(d) Such other matters as the Board may from time to time
prescribe.
SECTION 4.05. Committee Members, Chairman, Books and Records.
Until the annual meeting of Stockholders at which Directors are elected in
2001, (a) one-half of the members of each committee will be citizens of
Canada or the United States and one-half of the members of each committee
will be nationals of Sweden or member states of the European Union, (b) a
U.S. Director shall be the chairman of each of the Nominating Committee and
the Compensation Committee, (c) the Chairman shall be the chairman of the
Executive Committee and (d) an European Director shall be the chairman of
the Audit Committee. Each committee shall fix its own rules of procedure
and shall meet at such times and places and upon such call or notice as
shall be provided by such rules. It shall keep a record of its acts and
minutes of its proceedings, and all action of the committee shall be
reported to the Board at the next meeting of the Board.
SECTION 4.06. Alternates. Alternate members of the committees
prescribed by this Article IV may be designated by the Board from among the
Directors to serve as occasion may require. Whenever a quorum cannot be
secured for any meeting of any such committees from among the regular
members thereof and designated alternates, the member or members of such
committee present at such meeting and not disqualified from voting, whether
or not he, she or they constitute a quorum, may unanimously appoint another
qualified member of the Board to act at the meeting in the place of such
absent or disqualified member.
Alternative members of such committees shall receive a
reimbursement for expenses and compensation at the same rate as regular
members of such committees.
SECTION 4.07. Other Committees. The Board may create such
other committees, each to consist of any even number of Directors, as it
may from time to time determine, and each such committee shall serve for
such term and shall
<PAGE>
<PAGE> 16
have and may exercise, during intervals between meetings of the Board, such
duties, functions and powers as the Board may from time to time prescribe.
In the Board's discretion, any such committee may have among its members
any number of executive officers.
SECTION 4.08. Quorum and Manner of Acting. At each meeting of
any committee the presence of a majority of the members of such committee,
whether regular or alternate, shall be necessary to constitute a quorum for
the transaction of business, and if a quorum is present the concurrence of
a majority of those present shall be necessary for the taking of any
action; provided, however, that no action may be taken by the Executive
Committee when two or more officers of the corporation are present as
members at a meeting of either such committee unless such action shall be
concurred in by the vote of two or more members of such committee who are
not officers of the Corporation.
ARTICLE V
OFFICERS
SECTION 5.01. Officers. The officers of the Corporation shall
be the President and Chief Executive Officer, such Executive Vice
Presidents, the Secretary, and a Treasurer and may include one or more Vice
Presidents as the Board may appoint from time to time, one or more
Assistant Secretaries and one or more Assistant Treasurers. Any two or
more offices may be held by the same person.
SECTION 5.02. Authority and Duties. All officers shall have
such authority and perform such duties in the management of the Corporation
as may be provided in these By-Laws or, to the extent not so provided, by
resolution of the Board.
SECTION 5.03. Mandatory and Voluntary Retirement. Each
Officer shall tender his or her resignation to the President and Chief
Executive Officer, effective as of the first day of the month following or
coinciding with his or her attaining age 65.
SECTION 5.04. Term of Office, Resignation and Removal. (a)
The President and Chief Executive Officer and the Executive Vice Presidents
shall be appointed by the Board and all other officers shall be nominated
by the Chairman and the President and Chief Executive Officer jointly and
<PAGE>
<PAGE> 17
appointed by the Board. Each officer shall hold office for such term as
may be determined by the Board.
(b) Any officer may resign at any time by giving written
notice to the Board, the Chairman, the President and Chief Executive
Officer or the Secretary. Such resignation shall take effect at the time
specified in such notice or, if the time be not specified, upon receipt
thereof by the Board, the Chairman, the President and Chief Executive
Officer or the Secretary, as the case may be. Unless otherwise specified
therein, acceptance of such resignation shall not be necessary to make it
effective.
(c) Any officer elected or appointed by the Board may be
removed by the Board at any time, but such removal shall be without
prejudice to the contract rights, if any, of the person so removed.
Election or appointment of an officer shall not itself create contractual
rights.
SECTION 5.05. Vacancies. Any vacancy occurring in any office
of the Corporation, for any reason, shall be filled by the Board or the
Chairman and the President and Chief Executive Officer in the same manner
as set forth in Section 5.04, as the case may be. Unless earlier removed
pursuant to Section 5.04 hereof, any officer appointed to fill any such
vacancy shall serve only until such time as the unexpired term of his or
her predecessor expires unless reappointed.
SECTION 5.06. The President and Chief Executive Officer. The
President and Chief Executive Officer shall, in the absence of the
Chairman, preside at all meetings of the Stockholders and of the Board.
The President and Chief Executive Officer shall be the Chief Executive
Officer and shall have general charge and supervision of the business of
the Corporation and, in general, shall perform all duties incident to the
office of chief executive officer or president of a corporation and such
other duties as may, from time to time, be assigned to him or her by the
Board or as may be provided by law. The President and Chief Executive
Officer shall have authority to sign and acknowledge in the name and on
behalf of the Corporation all stock certificates, contracts or other
documents and instruments and, unless otherwise provided by law or by the
Board, may authorize any officer, employee or agent of the Corporation to
sign, execute and acknowledge in his place and stead all such documents and
instruments.
SECTION 5.07. The Executive Vice Presidents. Executive Vice
Presidents shall generally assist, and report to, the President and Chief
Executive Officer and perform such
<PAGE>
<PAGE> 18
other duties as the Board or the President and Chief Executive Officer
shall prescribe.
SECTION 5.08. Vice Presidents. Vice Presidents shall perform
such duties as the President and Chief Executive Officer shall prescribe.
SECTION 5.09. The Secretary. The Secretary shall, to the
extent practicable, attend all meetings of the Board and all meetings of
Stockholders and shall record all votes and the minutes of all proceedings
in a book to be kept for that purpose, and shall perform the same duties
for any committee of the Board when so requested by such committee. He or
she shall give or cause to be given notice of all meetings of Stockholders
and of the Board, shall perform such other duties as may be prescribed by
the Board, the Chairman or the President and Chief Executive Officer and
shall act under the supervision of the Chairman and the President and Chief
Executive Officer. He or she shall keep in safe custody the seal of the
Corporation and affix the same to any instrument that requires that the
seal be affixed to it and which shall have been duly authorized for
signature in the name of the Corporation and, when so affixed, the seal
shall be attested by his or her signature or by the signature of the
Treasurer of the Corporation or an Assistant Secretary or Assistant
Treasurer of the Corporation. He or she shall keep in safe custody the
certificate books and stockholder records and such other books and records
of the Corporation as the Board, the Chairman or the President and Chief
Executive Officer may direct and shall perform all other duties incident to
the office of Secretary and such other duties as from time to time may be
assigned to him or her by the Board, the Chairman or the President and
Chief Executive Officer.
SECTION 5.10. Assistant Secretaries. Assistant Secretaries of
the Corporation, if any, shall generally assist the Secretary and perform
such other duties as the Board or the Secretary shall prescribe, and, in
the absence or disability of the Secretary, shall perform the duties and
exercise the powers of the Secretary.
SECTION 5.11. The Treasurer. The Treasurer of the Corporation
shall have the care and custody of all the funds of the Corporation and
shall deposit such funds in such banks or other depositories as the Board,
or any officer or officers, or any officer and agent jointly, duly
authorized by the Board, shall, from time to time, direct or approve. He
or she shall disburse the funds of the Corporation under the direction of
the Board, the Chairman and the President and Chief Executive Officer. He
or she shall keep a full and
<PAGE>
<PAGE> 19
accurate account of all moneys received and paid on account of the
Corporation and shall render a statement of his or her accounts whenever
the Board, the Chairman or the President and Chief Executive Officer shall
so request. He or she shall perform all other necessary actions and duties
in connection with the administration of the financial affairs of the
Corporation and shall generally perform all the duties usually appertaining
to the office of treasurer of a corporation. When required by the Board,
he or she shall give bonds for the faithful discharge of his or her duties
in such sums and with such sureties as the Board shall approve.
SECTION 5.12. Assistant Treasurers. Assistant Treasurers of
the Corporation shall generally assist the Treasurer and perform such other
duties as the Board or the Treasurer shall prescribe, and, in the absence
or disability of the Treasurer, shall perform the duties and exercise the
powers of the Treasurer.
ARTICLE VI
DIVIDENDS, FINANCE, AND PROXIES
SECTION 6.01. Dividends. Dividends shall be declared only out
of any assets or funds of the Corporation legally available for the payment
of dividends at such times as the Board shall direct. Dividends shall be
paid to holders of the Shares in U.S. dollars. The Corporation shall make
such arrangements as are necessary or appropriate to ensure that all
dividends payable to Swedish Holders are paid in Swedish kronor.
SECTION 6.02. Checks, Drafts and Notes. All checks, drafts
and other orders for the payment of money, notes and other evidences of
indebtedness issued in the name of the Corporation shall be signed by such
officer or officers, agent or agents of the Corporation and in such manner
as shall be determined, from time to time, by resolution of the Board.
SECTION 6.03. Execution of Proxies. The President and Chief
Executive Officer shall have the power and authority to transfer, vote,
consent, or take any other action with respect to any securities of another
issuer which may be held or owned by the Corporation and to make, execute,
and deliver any waiver, proxy or consent with respect to any such
securities. All such proxies and consents, unless otherwise authorized by
the Board, shall be signed in the name of the
<PAGE>
<PAGE> 20
Corporation by the President and Chief Executive Officer or his or her
designee.
ARTICLE VII
SWEDISH DEPOSITARY SHARES PROGRAM
SECTION 7.01. SDSs and Swedish Holders. The Corporation shall
use all reasonable efforts to maintain the listing and index membership of
its SDSs in Sweden and its SDSs on the "A" list as such term is used by the
SSE. The Corporation shall use all reasonable efforts to establish
arrangements such that the Swedish Holders shall have the opportunity to
exercise such rights with respect to the Corporation as would be
exercisable by such Swedish Holders if they held shares of common stock of
the Corporation directly.
ARTICLE VIII
REPORTING REQUIREMENTS
SECTION 8.01. Shareholder Communications. All communications
to Stockholders shall be made available in both the English and Swedish
languages, including, without limitation, the annual and any semiannual or
quarterly reports of the Corporation, and financial statements, and all
such communications shall be made available to all Swedish Holders.
ARTICLE IX
SHARES AND TRANSFERS OF SHARES
SECTION 9.01. Certificates Evidencing Shares. The shares of
the Corporation shall be evidenced by certificates in such form or forms as
shall be approved by the Board. Certificates shall be signed by the
Chairman or the President and Chief Executive Officer or both and by the
Secretary or any Assistant Secretary. Any signature on a certificate may
be a facsimile. In the event any such officer who has signed or whose
facsimile signature has been placed upon a certificate shall have ceased to
hold such office or to be employed by the Corporation before such
certificate is issued, such certificate may be issued by the Corporation
with the same effect as if such officer had held such office on the date of
issue.
<PAGE>
<PAGE> 21
SECTION 9.02. Stock Ledger. A stock ledger in one or more
counterparts shall be kept by the Secretary, in which shall be recorded the
name and address of each person, firm or corporation owning the shares
evidenced by each certificate evidencing shares issued by the Corporation,
the number of shares evidenced by each such certificate, the date of
issuance thereof and, in the case of cancellation, the date of
cancellation. Except as otherwise expressly required by law, the person in
whose name shares stand on the stock ledger of the Corporation shall be
deemed the owner and record holder thereof for all purposes.
SECTION 9.03. Transfers of Shares. Registration of transfers
of shares shall be made only in the stock ledger of the Corporation upon
request of the registered holder of such shares, or of his attorney
thereunto authorized by power of attorney duly executed and filed with the
Secretary, and upon the surrender of the certificate or certificates
evidencing such shares properly endorsed or accompanied by a stock power
duly executed, together with such proof of the authenticity of signatures
as the Corporation may reasonably require.
SECTION 9.04. Addresses of Stockholders. Each Stockholder and
Swedish Holder shall designate to the Secretary an address at which notices
of meetings and all other corporate notices may be served or mailed to such
Stockholder or Swedish Holder, as the case may be, and, if any Stockholder
shall fail to so designate such an address, corporate notices may be served
upon such Stockholder by mail directed to the mailing address, if any, as
the same appears in the stock ledger of the Corporation or at the last
known mailing address of such Stockholder or Swedish Holder, as the case
may be.
SECTION 9.05. Lost, Destroyed and Mutilated Certificates.
Each Stockholder shall promptly notify the Corporation of any loss,
destruction or mutilation of any certificate or certificates evidencing any
share or shares of which he is the recordholder. The Board may, in its
discretion, cause the Corporation to issue a new certificate in place of
any certificate theretofore issued by it and alleged to have been
mutilated, lost, stolen or destroyed, upon the surrender of the mutilated
certificate or, in the case of loss, theft or destruction of the
certificate, upon satisfactory proof of such loss, theft or destruction,
and the Board may, in its discretion, require the recordholder of the
shares evidenced by the lost, stolen or destroyed certificate or his legal
representative to give the Corporation a bond sufficient to indemnify the
Corporation against any claim made against it on account of the alleged
loss, theft or
<PAGE>
<PAGE> 22
destruction of any such certificate or the issuance of such new
certificate.
SECTION 9.06. Regulations. The Board may make such other
rules and regulations as it may deem expedient, not inconsistent with these
By-Laws, concerning the issue, transfer and registration of certificates
evidencing shares.
ARTICLE X
SEAL
SECTION 10.01. Seal. The Board may approve and adopt a
corporate seal, which shall be in the form of a circle and shall bear the
full name of the Corporation, the year of its incorporation and the words
"Corporate Seal Delaware".
ARTICLE XI
FISCAL YEAR
SECTION 11.01. Fiscal Year. The fiscal year of the
Corporation shall end on the thirty-first day of December of each year.
ARTICLE XII
INDEMNIFICATION AND INSURANCE
SECTION 12.01. Indemnification. (a) The Corporation shall
indemnify any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an
action by or in the right of the Corporation) by reason of the fact that he
or she is or was a Director, officer, employee or agent of the Corporation,
or is or was serving at the request of the Corporation as a Director,
officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by him or her in connection with such action, suit or
proceeding if he or she acted in good faith and in a manner he or she
reasonably believed to be in, or not opposed to, the best interests of the
Corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his or her conduct was unlawful.
<PAGE>
<PAGE> 23
The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that the person did
not act in good faith and in a manner which he or she reasonably believed
to be in or not opposed to the best interests of the Corporation, and, with
respect to any criminal action or proceeding, had reasonable cause to
believe that his or her conduct was unlawful.
(b) The Corporation shall indemnify any person who was or is
a party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the Corporation to procure a
judgment in its favor by reason of the fact that he or she is or was a
Director, officer, employee or agent of the Corporation, or is or was
serving at the request of the Corporation as a Director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise against expenses (including attorneys' fees) actually and
reasonably incurred by him or her in connection with the defense or
settlement of such action or suit if he or she acted in good faith and in a
manner he or she reasonably believed to be in or not opposed to the best
interests of the Corporation and except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable to the Corporation unless and only to the
extent that the Court of Chancery of the State of Delaware or the court in
which such action or suit was brought shall determine upon application
that, despite the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of Chancery or such other court
shall deem proper.
(c) To the extent that a Director, officer, employee or agent
of the Corporation has been successful on the merits or otherwise in
defense of any action, suit or proceeding referred to in Sections 12.01(a)
and (b) of these By-Laws, or in defense of any claim, issue or matter
therein, he or she shall be indemnified against expenses (including
attorneys' fees) actually and reasonably incurred by him or her in
connection therewith.
(d) Any indemnification under Sections 12.01(a) and (b) of
these By-Laws (unless ordered by a court) shall be made by the Corporation
only as authorized in the specific case upon a determination that
indemnification of the Director, officer, employee or agent is proper in
the circumstances because he or she has met the applicable standard of
conduct set forth in Sections 12.01(a) and (b) of these By-Laws. Such
<PAGE>
<PAGE> 24
determination shall be made (i) by the Board by a majority vote of a quorum
consisting of Directors who were not parties to such action, suit or
proceeding, or (ii) if such a quorum is not obtainable, or, even if
obtainable, a quorum of disinterested Directors so directs, by independent
legal counsel in a written opinion, or (iii) by the Stockholders of the
Corporation.
(e) A Director of this Corporation shall not be liable to the
Corporation or its Stockholders for monetary damages for breach of
fiduciary duty as a Director, except for liability (i) for any breach of
the Director's duty of loyalty to the Corporation or its Stockholders, (ii)
for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of the law, (ii) under Section 174 of the
General Corporation Law of the State of Delaware (the "General Corporation
Law"), or (iv) for any transaction from which the Director derived an
improper personal benefit.
(f) Expenses (including attorneys' fees) incurred by an
officer or Director in defending any civil, criminal, administrative or
investigative action, suit or proceeding may be paid by the Corporation, as
the Board deems appropriate, in advance of the final disposition of such
action, suit or proceeding upon receipt of an undertaking by or on behalf
of such Director or officer to repay such amount if it shall ultimately be
determined that he is not entitled to be indemnified by the Corporation
pursuant to this Article XII. Such expenses (including attorneys' fees)
incurred by other employees and agents may be so paid upon such terms and
conditions, if any, as the Board deems appropriate.
(g) The indemnification and advancement of expenses provided
by, or granted pursuant to, other Sections of this Article XII shall not be
deemed exclusive of any other rights to which those seeking indemnification
or advancement of expenses may be entitled under any law, by-law,
agreement, vote of stockholders or disinterested Directors or otherwise,
both as to action in an official capacity and as to action in another
capacity while holding such office.
(h) For purposes of this Article XII, references to "the
Corporation" shall include, in addition to the Corporation, any constituent
corporation, including Pharmacia Aktiebolag ("Pharmacia"), The Upjohn
Corporation ("Upjohn") and any companies to which Pharmacia and Upjohn had
previously extended rights similar to those afforded by this Article XII
which would have had power and authority to indemnify its Directors,
officers, employees or agents so that any person
<PAGE>
<PAGE> 25
who is or was a Director, officer, employee or agent of such constituent
corporation, or is or was serving at the request of such constituent
corporation as a Director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, shall
stand in the same position under the provisions of this Article XII with
respect to the resulting or surviving corporation as he or she would have
with respect to such constituent corporation if its separate existence had
continued.
(i) For purposes of this Article XII, references to "other
enterprises" shall include employee benefit plans; references to "fines"
shall include any excise taxes assessed on a person with respect to an
employee benefit plan; and references to "serving at the request of the
Corporation" shall include any service as a Director, officer, employee or
agent of the Corporation which imposes duties on, or involves service by,
such Director, officer, employee or agent with respect to any employee
benefit plan, its participants, or beneficiaries; and a person who acted in
good faith and in a manner he or she reasonably believed to be in the
interest of the participants and beneficiaries of an employee benefit plan
shall be deemed to have acted in a manner "not opposed to the best
interests of the Corporation" as referred to in this Article XII.
(j) The indemnification and advancement of expenses provided
by, or granted pursuant to, this Article XII shall, unless otherwise
provided when authorized or ratified, continue as to a person who has
ceased to be a Director, officer, employee or agent and shall inure to the
benefit of the heirs, executors and administrators of such a person.
SECTION 12.02. Insurance for Indemnification. The Corporation
may purchase and maintain insurance on behalf of any person who is or was a
Director, officer, employee or agent of the Corporation, or is or was
serving at the request of the Corporation as a Director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise, is entitled to indemnification under the Corporation's Restated
Certificate of Incorporation against any liability asserted against him or
her and incurred by him or her in any such capacity, or arising out of his
or her status as such, whether or not the Corporation would have the power
to indemnify him or her against such liability under the provisions of
Section 145 of the General Corporation Law.
<PAGE>
<PAGE> 26
ARTICLE XIII
AMENDMENTS
SECTION 13.01. Amendments. (a) Except as provided in
paragraph (b) below, any By-Law (including these Restated By-Laws) may be
adopted, amended or repealed by the Stockholders, or by vote of the Board
or by a written consent of Directors pursuant to Section 3.09 hereof.
(b) Notwithstanding paragraph (a) above, (i) any amendment,
alteration, change or repeal in any respect of any provision of the first
sentence of Section 1.02, Section 3.02, Sections 3.03(a) and (c), the first
sentence of Section 4.05, Section 6.01, Article VII and Article VIII shall
require the affirmative vote of 80% of all the Directors or the affirmative
vote of 66-2/3% of the then outstanding shares of capital stock of the
Corporation entitled to vote on matters submitted to stockholders of the
Corporation (the "Voting Stock", and a "Supermajority Vote"); (ii) any
amendment, alteration, change or repeal in any respect of any provision of
Section 2.01(b) shall require the affirmative vote of 80% of the Directors
or a Supermajority Vote, provided, however, that in the event that (X) the
number of persons that are residents in or nationals of Sweden holding
Shares, whether directly or as SDSs (the "Swedish Persons"), falls below 5%
of the total number of persons holding Voting Stock or (Y) such Swedish
Persons cease to beneficially own at least 5% of the Voting Stock
(including shares held by the Depositary), then any such amendment,
alteration, change or repeal in any respect of any of these provisions
shall require the affirmative vote of a majority of the Directors or the
affirmative vote of the holders of a majority of the Voting Stock; and
(iii) any amendment, alteration, change or repeal in any respect of Section
13.01(a) hereof or subparagraphs (i) or (ii) of this Section 13.01(b) shall
require the affirmative vote of 80% of all the Directors or a Supermajority
Vote.
<PAGE> 1
Exhibit 5
[Letterhead of Sullivan & Cromwell]
May 2, 1996
Pharmacia & Upjohn, Inc.,
Knyvett House,
The Causeway,
Staines, Middlesex TW18 3BA,
England.
Dear Sirs:
In connection with the registration under the Securities Act of
1933 (the "Act") of 5,000,000 shares (the "Securities") of Common Stock,
par value $.01 per share, of Pharmacia & Upjohn, Inc. (the "Company"), a
Delaware corporation, to be offered to employees under the Company's Long-
Term Incentive Plan we, as your special counsel, have examined such
corporate records, certificates and other documents, and such questions of
law, as we have considered necessary or appropriate for the purposes of
this opinion. Upon the basis of such examination, we advise you that, in
our opinion, when the Registration Statement on Form S-8 (the "Registration
Statement") has become effective under the Act and the Securities have been
duly issued and sold upon either the exercise of options by the employees
as contemplated by the Registration Statement or granted to the employees
as contemplated by the Registration
<PAGE>
<PAGE> 2
Statement, the Securities being sold by the Company will be validly issued,
fully paid and nonassessable.
The foregoing opinion is limited to the Federal laws of the
United States and the General Corporation Law of the State of Delaware, and
we are expressing no opinion as to the effect of the laws of any other
jurisdiction.
Also, we have relied as to certain matters on information
obtained from public officials, officers of the Company and other sources
believed by us to be responsible.
We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement. In giving such consent, we do not thereby
admit that we are in the category of persons whose consent is required
under Section 7 of the Act.
Very truly yours,
/s/ Sullivan & Cromwell
<PAGE> 1
Exhibit 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the inclusion in this registration statement on
Form S-8 of our report, which includes an explanatory paragraph on the
change in practice of reporting certain majority-owned subsidiaries from a
fiscal year ending November 30 to a calendar year ending December 31 and
the change in method of accounting for other postemployment benefits, dated
February 21, 1996, on our audits of the financial statements of Pharmacia &
Upjohn, Inc. and subsidiaries as of December 31, 1995 and 1994 and for
the years ended December 31, 1995, 1994, and 1993.
/s/ COOPERS & LYBRAND, L.L.P. /s/ KPMG PEAT MARWICK, LLP
Chicago, Illinois
April 26, 1996
