Document:

exv10w2

 

EXHIBIT 10.2

NOMINATING AGREEMENT

     This NOMINATING AGREEMENT (this “Agreement”) is made as of November 14,
2004 between Perrigo Company, a Michigan corporation (“Buyer”), and the
undersigned shareholder (“Shareholder”) of Agis Industries (1983) Ltd., an
Israeli public company (the “Company”).

RECITALS:

     WHEREAS, concurrently with the execution and delivery of this Agreement,
Buyer, Perrigo Israel Opportunities, Ltd., a private Israeli company and
indirect wholly owned subsidiary of Buyer (“Merger Sub”), and the Company are
entering into an Agreement and Plan of Merger of even date herewith (the
“Merger Agreement”), pursuant to which Merger Sub will be merged with and into
the Company (the “Merger”);

     WHEREAS, concurrently with the execution and delivery of this Agreement,
Buyer and Shareholder are entering into (i) an Undertaking Agreement (the
“Undertaking Agreement”), pursuant to which Shareholder agrees to vote in favor
of the transactions contemplated by the Merger Agreement and (ii) a Lockup
Agreement (the “Lockup Agreement”), pursuant to which Shareholder agrees, for a
specific period of time, not to sell shares of Buyer common stock that
Shareholder acquired upon the consummation of the Merger;

     WHEREAS, it is a condition to the willingness of Shareholder to enter into
the Undertaking Agreement and the Lockup Agreement that Buyer provide
Shareholder with the right to designate directors to the Board of Directors of
Buyer in the manner set forth herein at the time of the consummation of the
transactions contemplated by the Merger Agreement; and

     WHEREAS, in order to induce Shareholder to enter into the Undertaking
Agreement and the Lockup Agreement, Buyer has agreed to enter into this
Agreement.

     NOW, THEREFORE, in consideration of the foregoing premises and of the
covenants and agreements set forth herein, and intending to be legally bound
hereby, the parties hereto agree as follows:

1.           Definitions.

     (a)      Capitalized terms used herein and not otherwise defined shall have the
meaning of set forth in the Merger Agreement.

     (b)      “Own” with respect to any securities means actual ownership by the
Shareholder (it being understood that any shares of Buyer common stock (i)
beneficially owned by Shareholder but held in nominee or street name or (ii)
transferred by Shareholder to a family member, trust or other entity controlled
by Shareholder solely for estate or tax planning purposes shall be deemed Owned
by Shareholder for purposes of this Agreement).

     (c)      “Board” means the Board of Directors of Buyer.

     (d)      “Director” means a member of the Board.

 

 

     (e)      “Independent” has the meaning set forth in the rules of the Nasdaq
Stock Market.

2.           Director Nomination Rights.

     (a)      On the Closing Date, the Board shall appoint Shareholder and one
Independent candidate designated by Shareholder to the Board (provided, that if
such Independent candidate has not been designated by Shareholder on or prior
to the Closing Date, the Board shall appoint to the Board such Independent
candidate when subsequently so designated by Shareholder). The parties hereto
acknowledge and agree that the Shareholder shall be appointed to the Board to
serve for a term expiring at Buyer’s 2007 annual meeting term and such
Independent candidate shall be appointed to the Board to serve for a term
expiring at Buyer’s 2006 annual meeting in order to comply with the
requirements for staggered terms and apportioned classes of Directors set forth
in Buyer’s By-laws. Notwithstanding the foregoing, the appointment of
Shareholder or any Shareholder-designated candidate pursuant to this Section
2(a), (i) shall be subject to the approval process of Buyer’s Nominating &
Governance Committee, consistent with Buyer’s Corporate Governance Guidelines,
and (ii) must have the requisite qualifications as determined in good faith by
the Nominating & Governance Committee; provided, however, that if for any
reason the conditions set forth in clauses (i) and (ii) are not satisfied,
Shareholder shall have the right to designate an alternate person or persons to
be so nominated. Nothing in this Section 2 shall prevent the Board from acting
in good faith in accordance with its Corporate Governance Guidelines while
giving due consideration to the intent of this Agreement.

     (b)      After the Closing Date, should there exist or occur any vacancy on the
Board as a result of death, disability, retirement, resignation, removal or any
other reason, including if any current Director shall not be nominated for
re-election (other than any vacancy resulting from the death, disability,
retirement, resignation or removal of Shareholder or any Shareholder Director),
the Board shall appoint one additional Independent candidate designated by
Shareholder to the Board to serve for a term of office continuing only until
the next election of the class of Directors in which the vacancy occurs. The
parties hereto acknowledge and agree that such Independent candidate shall be
nominated to the same class as the Director that such Independent candidate is
replacing. Notwithstanding the foregoing, the appointment of a
Shareholder-designated candidate pursuant to this Section 2(b), (i) shall be
subject to the approval process of Buyer’s Nominating & Governance Committee,
consistent with Buyer’s Corporate Governance Guidelines, and (ii) must have the
requisite qualifications as determined in good faith by the Nominating &
Governance Committee; provided, however, that if for any reason the conditions
set forth in clauses (i) and (ii) are not satisfied, Shareholder shall have the
right to designate an alternate person or persons to be so nominated. Nothing
in this Section 2 shall prevent the Board from acting in good faith in
accordance with its Corporate Governance Guidelines while giving due
consideration to the intent of this Agreement.

     (c)      Following the initial appointments referenced in Sections 2(a) and (b)
above, Buyer shall nominate for the Board at the next applicable annual meeting
of the shareholders of Buyer, any Independent candidates designated by
Shareholder pursuant to the terms of this Agreement (each such designated
Independent candidate a “Shareholder Director” and collectively, the
“Shareholder Directors”); provided, however, that Buyer shall only be obligated
to nominate any Shareholder Director at the annual meeting at which the term of
the class of Directors to which any Shareholder Director belongs has expired
and such class of

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Directors is up for election. In accordance with its Corporate Governance
Guidelines, the Board shall submit in writing the name of any Shareholder
Director to the Buyer Nominating & Governance Committee for election to the
Board. The Company shall use its reasonable best efforts (i) to cause the
Buyer Nominating & Governance Committee to include the name of the Shareholder
Directors so submitted among its nominees for election to the Board and (ii) to
cause the Board to unanimously recommend that the shareholders of Buyer vote in
favor of the Shareholder Directors; provided, however, that if for any reason
the conditions set forth in clauses (i) and (ii) are not satisfied, Shareholder
shall have the right to designate an alternate person or persons to be so
nominated. Nothing in this Section 2 shall prevent the Board from acting in
good faith in accordance with its Corporate Governance Guidelines while giving
due consideration to the intent of this Agreement.

     (d)      Following the initial appointment of Shareholder referenced in Section
2(a) above, Buyer shall nominate Shareholder at each applicable annual meeting
of the shareholders of Buyer to serve on the Board; provided, however, the
Buyer shall only be obligated to nominate the Shareholder at each annual
meeting at which the term of the class of Directors to which Shareholder
belongs has expired and such class of Directors is up for election. In
accordance with its Corporate Governance Guidelines, the Board shall submit in
writing Shareholder’s name to the Buyer Nominating & Governance Committee for
election to the Board. The Company shall use its reasonable best efforts (i)
to cause the Buyer Nominating & Governance Committee to include the Shareholder
so submitted among its nominees for election to the Board and (ii) to cause the
Board to unanimously recommend that the shareholders of Buyer to vote in favor
of Shareholder. Nothing in this Section 2 shall prevent the Board from acting
in good faith in accordance with its Corporate Governance Guidelines while
giving due consideration to the intent of this Agreement.

     (e)      The Shareholder Directors (but not the Shareholder), will each be
invited to serve on at least one committee of the Board while serving as
Directors, in accordance with and subject to their respective qualifications.
The parties hereto acknowledge and agree that so long as each applicable
Shareholder Director (i) submits to the proper approval process with the
Nominating & Governance Committee, consistent with Buyer’s Corporate Governance
Guidelines and (ii) has the requisite qualifications as determined in good
faith by the Nominating & Governance Committee, one of the Shareholder
Directors will be invited to serve on the Audit Committee of the Board while
serving as a Director and one of the Shareholder Directors will be invited to
serve on the Compensation Committee of the Board while serving as a Director.

     (f)      Subject to Sections 2(c), 2(g), 3, and 5, in the event any Shareholder
Director dies, becomes disabled or resigns, retires or is removed from the
Board, Shareholder shall have the right to designate a replacement director to
fill such vacancy to serve for a term of office continuing only until the next
election of the class of Directors in which the vacancy occurs and such
replacement director shall be considered a “Shareholder Director” for purposes
of this Agreement.

     (g)      (i)      The rights of Shareholder to designate any Shareholder Director,
the right of any Shareholder Director to sit on the Board, and the obligations
of the Board and Buyer pursuant to this Section 2 with respect to the
Shareholder Directors shall terminate in the event that Shareholder both (A)
ceases to Own 9% of the outstanding shares of Buyer common stock

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and (B) ceases to Own 9,000,000 shares of Buyer common stock.

               (ii)      All rights of Shareholder, including without limitation, the right of
Shareholder to sit on the Board, and the obligations of the Board and Buyer
pursuant to this Section 2, shall terminate in the event Shareholder ceases to
Own 5,000,000 shares of Buyer common stock.

3.           Resignation of Directors.

     (a)      Each Shareholder Director shall tender his or her resignation from the
Board, (i) at the time Shareholder both (A) ceases to Own 9% of the outstanding
shares of Buyer common stock and (B) ceases to Own 9,000,000 shares of Buyer
common stock, or (ii) if such person is no longer entitled to serve on the
Board pursuant to the terms hereof. In the event Buyer shall not have accepted
such resignation offer within 30 days following the date thereof, the
Shareholder Director shall continue to serve on the Board until the next
election of the class of Directors to which such Shareholder Director belongs.
Buyer’s obligations to nominate and recommend each Shareholder Director is
conditioned upon each such Shareholder Director’s execution and delivery to
Buyer of a written agreement to be bound by the terms of this Section 3.

     (b)      Shareholder shall tender his resignation from the Board, (i) at the
time Shareholder ceases to Own 5,000,000 shares of Buyer common stock, or (ii)
if he is no longer entitled to serve on the Board pursuant to the terms hereof.
In the event Buyer shall not have accepted such resignation offer within 30
days following the date thereof, Shareholder shall continue to serve on the
Board until the next election of the class of Directors to which Shareholder
belongs.

4.           Equal Treatment. Buyer shall provide the same compensation and rights and
benefits of indemnity to the Shareholder Directors as are provided to other
non-employee directors.

5.           Limitations on Nomination Rights. Notwithstanding anything contained in
this Agreement to the contrary, Shareholder shall not be entitled to designate
any Shareholder Directors if the nomination of such Shareholder Directors would
violate applicable law or would result in a breach by the Board of its
fiduciary duties to Buyer and its shareholders, the approval process of the
Nominating & Governance Committee, or the Board’s Corporate Governance
Guidelines while giving due consideration to the intent of this Agreement;
provided, however, that the foregoing shall not affect the Shareholder’s right
to designate an alternate person or persons to be so nominated.

6.           Amendments and Waivers.

     Any provision of this Agreement may be amended or waived if, and only if,
such amendment or waiver is in writing and is signed, in the case of an
amendment, by each party to this Agreement, or in the case of a waiver, by the
party against whom the waiver is to be effective.

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     No failure or delay by any party in exercising any right or privilege
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. To the maximum extent permitted by law,
(a) no waiver that may be given by a party shall be applicable except in the
specific instance for which it was given and (b) no notice to or demand on one
party shall be deemed to be a waiver of any obligation of such party or the
right of the party giving such notice or demand to take further action without
notice or demand.

7.           Assignment. This Agreement may not be assigned by either party hereto
without the prior written consent of the other party. Subject to the foregoing
sentence, all of the terms and provisions of this Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective
executors, heirs, personal representatives, successors and assigns.

8.           Entire Agreement. This Agreement and the documents, instruments and other
agreements specifically referred to herein or delivered pursuant hereto, set
forth the entire understanding of the parties with respect to the subject
matter hereof. Any and all previous agreements and understandings between or
among the parties regarding the subject matter hereof, whether written or oral,
are superseded by this Agreement.

9.           Notices. Any notice, request, demand, waiver, consent, approval or other
communication which is required or permitted hereunder shall be in writing and
shall be deemed given; (a) on the date established by the sender as having been
delivered personally; (b) on the date delivered by a private courier as
established by the sender by evidence obtained from the courier; (c) on the
date sent by facsimile, with confirmation of transmission, if sent during
normal business hours of the recipient, if not, then on the next business day;
or (d) on the fifth day after the date mailed, by certified or registered mail,
return receipt requested, postage prepaid. Such communications, to be valid,
must be addressed as follows:

If to Buyer, to:

Perrigo Company

515 Eastern Avenue

Allegan, MI 49010

Attention: Chief Executive Officer

Telecopier: 269-673-7535

and

Perrigo Company

515 Eastern Avenue

Allegan, MI 49010

Attention: Vice President and General Counsel

Telecopier: 269-673-1386

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with a copy to:

Morgan, Lewis & Bockius LLP

502 Carnegie Center

Princeton, NJ 08540

Attention:. Randall B. Sunberg, Esq.

Telecopier: 609-919-6639

If to Shareholder:

Moshe Arkin

29 Lehi Street

Bnei-Brak 51200

Israel

Telecopier: 972-3-577-3500

with a copy to:

Skadden, Arps, Slate, Meagher & Flom LLP

Four Times Square

New York, NY 10036

Attn: David Fox, Esq.

Thomas W. Greenberg, Esq.

Telecopier: 212-735-2000

and

Rosenberg, Hacohen, Goddard & Ephrat

24 Raoul Wallenberg Street

Tel-Aviv 69719

Israel

Attn: Dan Hacohen, Adv.

Telecopier: 972-3-766-6567

or to such other address or to the attention of such Person or Persons as the
recipient party has specified by prior written notice to the sending party (or
in the case of counsel, to such other readily ascertainable business address as
such counsel may hereafter maintain). If more than one method for sending
notice as set forth above is used, the earliest notice date established as set
forth above shall control.

10.           Captions. All captions contained in this Agreement are for convenience of
reference only, do not form a part of this Agreement and shall not affect in
any way the meaning or interpretation of this Agreement.

11.           Counterparts. This Agreement may be executed in counterparts, and either
party may execute such counterpart, both of which when executed and delivered
shall be deemed to be an original and which counterparts taken together shall
constitute but one and the same instrument.

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12.           Severability; Enforcement. Any provision of this Agreement which is
invalid or unenforceable in any jurisdiction shall be ineffective to the
extent of such invalidity or unenforceability without invalidating or
rendering unenforceable the remaining provisions hereof, and any such
invalidity or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

13.           Specific Performance. The parties hereto agree that irreparable damage
would occur in the event that any provision of this Agreement were not
performed in accordance with its specific terms or were otherwise breached. It
is accordingly agreed that the parties shall be entitled to seek an injunction
or injunctions to prevent breaches of this Agreement and to enforce
specifically the terms and provisions hereof in any court of the United States
or any state having jurisdiction without the necessity of demonstrating damages
or posting a bond, this being in addition to any other remedy to which they are
entitled at law or in equity.

14.           Consent to Jurisdiction. Each party irrevocably submits to the exclusive
jurisdiction of any court of competent jurisdiction in the State of New York
for the purposes of any suit, action or other proceeding arising out of this
Agreement or any transaction contemplated hereby. Each party agrees to commence
any such action, suit or proceeding in any court of competent jurisdiction in
the State of New York. Each party further agrees that service of any process,
summons, notice or document by U.S. registered mail to such party’s respective
address set forth above shall be effective service of process for any action,
suit or proceeding in a court of competent jurisdiction in the State of New
York with respect to any matters to which it has submitted to jurisdiction in
this Section 14. Each party irrevocably and unconditionally waives any
objection to the laying of venue of any action, suit or proceeding arising out
of this Agreement or the transactions contemplated hereby in a court of
competent jurisdiction in the State of New York, and hereby further irrevocably
and unconditionally waives and agrees not to plead or claim in any such court
that any such action, suit or proceeding brought in any such court has been
brought in an inconvenient forum. EACH PARTY HEREBY IRREVOCABLY WAIVES ALL
RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED
ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR
THE ACTIONS OF SUCH PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND
ENFORCEMENT HEREOF.

15.           Governing Law. This Agreement shall be governed by and interpreted and
enforced in accordance with the laws of the State of New York, without giving
effect to any choice of law or conflict of laws rules or provisions (whether of
the State of New York or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of New York;
provided, however, that any matter involving the internal corporate affairs of
Buyer shall be governed by the provisions of the jurisdiction of its
incorporation.

16.           Condition to Effectiveness. Notwithstanding anything in this Agreement to
the contrary, this Agreement shall not be effective until the Effective Time.
In the event the Effective Time does not occur, this Agreement shall not be
valid, binding and enforceable against any of the parties hereto.

[Signature Page to Follow]

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     IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto all as of the day and year first above written.

	 	 	 	 	 
	 	PERRIGO COMPANY

 	 
	 	By:  	/s/ David T. Gibbons
 	 
	 	 	Name:  	David T. Gibbons 	 
	 	 	Title:  	Chairman, President and Chief

Executive Officer 	 
	 

	 	 	 	 	 
	 	SHAREHOLDER

 	 
	 	/s/ Moshe Arkin
 	 
	 	(Signature) 	 
	 	 	 
	 

	 	 	 	 	 
	 	 	 
	 	                                         Moshe Arkin
 	 
	 	Print Name 	 
	 	 	 
	 

[Signature Page to Nominating Agreement]exv10w3

 

EXHIBIT 10.3

UNDERTAKING AGREEMENT

     This UNDERTAKING AGREEMENT (“Agreement”) is made as of November 14, 2004,
between Perrigo Company, a Michigan corporation (“Buyer”), Agis Industries
(1983) Ltd., an Israeli public company (the “Company”) and the undersigned
shareholder (“Shareholder”) of the Company.

RECITALS:

     WHEREAS, concurrently with the execution and delivery of this Agreement,
Buyer, Perrigo Israel Opportunities Ltd., a private Israeli company and wholly
owned subsidiary of Buyer (“Merger Sub”), and the Company are entering into an
Agreement and Plan of Merger of even date herewith (the “Merger Agreement”),
pursuant to which Merger Sub will be merged with and into the Company, and the
Company will become a wholly owned subsidiary of Buyer (the “Merger”);

     WHEREAS, as of the date hereof, Shareholder is the Beneficial Owner (as
defined below) of the Subject Shares (as defined below);

     WHEREAS, the Board of Directors of the Company has: (x) determined that
the Merger and the Merger Agreement are fair to, and in the best interests of,
the Company and its shareholders, (y) approved the Merger and the Merger
Agreement; and (z) determined to recommend to the shareholders of the Company
to approve the Merger and the Merger Agreement;

     WHEREAS, it is a condition to the willingness of Buyer and the Company to
enter into the Merger Agreement and to consummate the Merger that the
Shareholder undertake the obligations set forth in this Agreement;

     WHEREAS, in order to induce Buyer and Merger Sub to enter into the Merger
Agreement, Shareholder has agreed to enter into this Agreement; and

     WHEREAS, it is a condition to the willingness of Shareholder to enter into
this Agreement that Buyer enters into the Merger Agreement.

     NOW, THEREFORE, in consideration of the foregoing premises and of the
covenants and agreements set forth herein and intending to be legally bound
hereby, the parties agree as follows:

1.           Definitions.

     (a)      Capitalized terms used herein but not otherwise defined shall have the
meanings set forth in the Merger Agreement.

     (b)      “Beneficially Own” or “Beneficial Owner” with respect to any
securities means having “beneficial ownership” as determined pursuant to Rule
13d-3 under the Securities Exchange Act of 1934, as amended (the “Exchange
Act”).

 

 

     (c)      “Company Capital Stock” means shares of common stock, par value 1.00
New Israeli Shekel per share, of the Company.

     (d)      “Company Options and Other Rights” means options, warrants and other
rights to acquire, directly or indirectly, shares of Company Capital Stock.

     (e)      “Expiration Date” means the earlier to occur of (i) the Effective
Time, (ii) the date on which the Merger Agreement is terminated pursuant to its
terms or (iii) the mutual agreement of Buyer and Shareholder to terminate this
Agreement.

     (f)      “Subject Shares” means (i) all shares of Company Capital Stock
Beneficially Owned by Shareholder as of the date of this Agreement; and (ii)
all additional shares of Company Capital Stock of which Shareholder acquires
Beneficial Ownership during the period from the date of this Agreement through
the Expiration Date.

2.           Voting.

     (a)      Shareholder hereby agrees that, prior to the Expiration Date, at any
meeting of the shareholders of the Company, however called, and in any written
action by consent of shareholders of the Company Shareholder shall cause to be
counted as present thereat for purposes of establishing a quorum and shall
vote, or cause to be voted, any and all Subject Shares Beneficially Owned by
Shareholder as of the record date of such meeting or written consent:

               (i)      in favor of the Merger, the execution and delivery by the Company of
the Merger Agreement and the adoption and approval of the Merger Agreement and
the terms thereof, in favor of each of the other actions contemplated by the
Merger Agreement and in favor of any action in furtherance of any of the
foregoing;

               (ii)      against any action or agreement that would reasonably be expected to
result in a breach of any representation, warranty, covenant or obligation of
the Company in the Merger Agreement; and

               (iii)      against the following actions (other than the Merger and the
transactions contemplated by the Merger Agreement): (A) any extraordinary
corporate transaction, such as a merger, consolidation or other business
combination involving the Company or any subsidiary of the Company other than,
in the case of the Company, with any subsidiary of the Company and in the case
of any subsidiary of the Company, with the Company or any subsidiary of the
Company; (B) any sale, lease, sublease, license, sublicense or transfer of a
material portion of the rights or other assets of the Company or any subsidiary
of the Company other than, in the case of the Company, to any subsidiary of the
Company and in the case of any subsidiary of the Company, to the Company or any
subsidiary of the Company; (C) any reorganization, recapitalization,
dissolution or liquidation of the Company or any subsidiary of the Company; (D)
any change in the individuals who serve as members of the board of directors of
the Company if such action would reasonably be expected to materially impair or
delay the ability of the Company to consummate the Merger; (E) any amendment to
the Company’s Memorandum of Association or Articles of Incorporation if such
action would reasonably be expected to materially impair or delay the ability
of the Company to consummate the Merger; (F) any

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material change in the capitalization of the Company or the Company’s
corporate structure; and (G) any other action which is intended, or would
reasonably be expected, to impede, interfere with, delay, postpone, discourage
or adversely affect the Merger or any of the other transactions contemplated by
the Merger Agreement or this Agreement.

     (b)      Prior to the Expiration Date, Shareholder shall not enter into any
agreement or understanding with any Person to vote or give instructions in any
manner inconsistent with clause “(i),” clause “(ii)” or clause “(iii)” of
Section 2(a).

     (c)      Shareholder hereby waives and agrees not to exercise any applicable
“appraisal rights” or similar rights, to the extent such rights exist, under
the Israel Companies Law with respect to the Subject Shares in connection with
the Merger and the Merger Agreement.

3.           Grant of Proxy; Appointment of Proxy.

     (a)      In furtherance of the transactions contemplated hereby and by the
Merger Agreement, and in order to secure the performance by Shareholder of
Shareholder’s duties under this Agreement, Shareholder, concurrently with the
execution of this Agreement, shall execute, in accordance with the provisions
of applicable Israeli law, and deliver to Buyer an irrevocable proxy,
substantially in the form of Annex A hereto unless a different form is
specified in the Company’s Articles of Association (in which case the proxy
shall meet the requirements of the Company’s Articles of Association) (the
“Proxy”).

     (b)      Shareholder understands and acknowledges that Buyer is entering into
the Merger Agreement in reliance upon such Proxy. Shareholder hereby affirms
that the Proxy set forth in this Section 3 is given to secure the performance
of the duties of Shareholder under this Agreement. Shareholder hereby affirms
that the irrevocable proxy is coupled with an interest and may under no
circumstances be revoked. Shareholder hereby ratifies and confirms all that
such irrevocable proxy may lawfully do or cause to be done by virtue hereof.

     (c)      Shareholder hereby revokes any and all prior proxies or powers of
attorney given by Shareholder with respect to the voting of the Subject Shares
in respect of any of the matters set forth in Section 2(a) and agrees not to
grant any subsequent proxies or powers of attorney with respect to the voting
of the Subject Shares in respect of any of the matters set forth in Section
2(a) until the Expiration Date.

     (d)      Shareholder shall, at Buyer’s own expense, perform such further acts
and execute such further proxies and other documents and instruments as may
reasonably be required to vest in Buyer the power to carry out and give effect
to the provisions of this Agreement.

4.           Covenants of Shareholder. Shareholder covenants and agrees for the benefit
of Buyer that, until the Expiration Date, Shareholder will not:

     (a)      other than pursuant to the Lock-Up Agreement, sell, transfer, pledge,
hypothecate, encumber, assign, tender or otherwise dispose of, or enter into
any contract, option or other arrangement or understanding with respect to the
sale, transfer, pledge, hypothecation, encumbrance, assignment, tender or other
disposition of, any Subject Shares or any interest therein; provided, however,
that Shareholder may sell, transfer, pledge, hypothecate, encumber,

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assign, tender or otherwise dispose of any Subject Shares to a family
member or trust or other entity for estate or tax planning purposes, provided,
that any such sale transfer, pledge, hypothecation, encumbrance, assignment,
tender or other disposition shall be conditioned on each such transferee
signing and delivering an Undertaking Agreement and Proxy in substantially the
form of this Agreement and the Proxy attached hereto;

     (b)      other than the Proxy or pursuant to the Lock-Up Agreement, grant any
powers of attorney or proxies or consents in respect of any of the Subject
Shares, deposit any of such Subject Shares into a voting trust, or enter into a
voting agreement with respect to any of such Subject Shares; or

     (c)      take any other action with respect to the Subject Shares that would in
any way restrict, limit or interfere with the performance of Shareholder’s
obligations hereunder or the transactions contemplated hereby and by the Merger
Agreement.

5.           Representations and Warranties of Shareholder. Shareholder represents and
warrants to Buyer as follows:

     (a)      As of the date of this Agreement

               (i)      Shareholder is the Beneficial Owner (free and clear of any
encumbrances or restrictions) of the outstanding shares of Company Capital
Stock set forth under the heading “Shares of Company Capital Stock Beneficially
Owned”, on the signature page hereof, which shares are registered in
Shareholder’s name in the Company’s books and records.

               (ii)      Shareholder does not directly or indirectly Beneficially Own any
Company Options and Other Rights; and

               (iii)      Shareholder does not directly or indirectly Beneficially Own any
shares of Company Capital Stock or other securities of the Company, other than
the shares of Company Capital Stock set forth on the signature page hereof.

     (b)      Shareholder has the legal capacity, power and authority to enter into
and perform all of Shareholder’s obligations under this Agreement and the
Proxy. This Agreement has been duly executed and delivered by Shareholder and,
upon its execution and delivery by Buyer, will constitute a legal, valid and
binding obligation of Shareholder, enforceable against Shareholder in
accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting or relating to creditors rights generally, and the availability of
injunctive relief and other equitable remedies.

     (c)      The execution, delivery and performance by Shareholder of this
Agreement will not (i) conflict with, require a consent, waiver or approval
under, or result in a breach of or default under, any of the terms of any
contract, commitment or other obligation to which Shareholder is a party or by
which any of Shareholder’s assets may be bound, or (ii) violate any order, writ
injunction, decree, judgment, order, statute, rule or regulation applicable to
Shareholder or any of its assets.

     (d)      No filing with, and no permit, authorization, consent or approval of,
any state or

4

 

federal public body or authority is necessary for the execution of this
Agreement by Shareholder and the consummation by Shareholder of the
transactions contemplated hereby.

6.           Adjustments; Additional Shares. In the event (a) of any stock dividend,
stock split, merger, recapitalization, reclassification, combination, exchange
of shares or the like of the capital stock of the Company on, of or affecting
the Subject Shares or (b) that Shareholder shall become the Beneficial Owner of
any additional shares of Company Capital Stock or other securities entitling
the holder thereof to vote or give consent with respect to the matters set
forth in Section 2(a), then the terms of this Agreement shall apply to the
shares of Company Capital Stock or other instruments or documents held by
Shareholder immediately following the effectiveness of the events described in
clause (a) or Shareholder becoming the Beneficial Owner thereof as described in
clause (b), as though, in either case, they were Subject Shares hereunder.

7.           Amendments and Waivers. Any provision of this Agreement may be amended or
waived if, and only if, such amendment or waiver is in writing and is signed,
in the case of an amendment, by each party to this Agreement, or in the case of
a waiver, by the party against whom the waiver is to be effective. No failure
or delay by any party in exercising any right or privilege hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. To the maximum extent permitted by law, (a) no
waiver that may be given by a party shall be applicable except in the specific
instance for which it was given and (b) no notice to or demand on one party
shall be deemed to be a waiver of any obligation of such party or the right of
the party giving such notice or demand to take further action without notice or
demand.

8.           Assignment. This Agreement may not be assigned by either party hereto
without the prior written consent of the other party. Subject to the
foregoing, all of the terms and provisions of this Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective
executors, heirs, personal representatives, successors and assigns.

9.           Entire Agreement. This Agreement and the documents, instruments and other
agreements specifically referred to herein or delivered pursuant hereto,
including, without limitation, the Lock-Up Agreement and the Proxy, set forth
the entire understanding of the parties with respect to the subject matter
hereof. Any and all previous agreements and understandings between or among the
parties regarding the subject matter hereof, whether written or oral, are
superseded by this Agreement.

10.           Notices. Any notice, request, demand, waiver, consent, approval or other
communication which is required or permitted hereunder shall be in writing and
shall be deemed given (a) on the date established by the sender as having been
delivered personally; (b) on the date delivered by a private courier as
established by the sender by evidence obtained from the courier; (c) on the
date sent by facsimile, with confirmation of transmission, if sent during
normal business hours of the recipient, if not, then on the next business day;
or (d) on the fifth day after the date mailed, by certified or registered mail,
return receipt requested, postage prepaid. Such communications, to be valid,
must be addressed as follows:

If to Buyer, to:

5

 

Perrigo Company

515 Eastern Avenue

Allegan, MI 49010

Attention: Chief Executive Officer

Telecopier: 269-673-7535

and

Perrigo Company

515 Eastern Avenue

Allegan, MI 49010

Attention: Vice President and General Counsel

Telecopier: 269-673-1386

with a copy to:

Morgan, Lewis & Bockius LLP

502 Carnegie Center

Princeton, NJ 08540

Attention:. Randall B. Sunberg, Esq.

Telecopier: 609-919-6639

and

Morgan, Lewis & Bockius LLP

101 Park Avenue

New York, NY 10178

Attention: Robert G. Robison, Esq.

Telecopier: 212-309-6001

If to Shareholder:

Moshe Arkin

29 Lehi Street

Bnei-Brak 51200

Israel

Telecopier: 972-3-577-3500

6

 

with a copy to:

Skadden, Arps, Slate, Meagher & Flom LLP

Four Times Square

New York, NY 10036

Attn: David Fox, Esq.

Thomas W. Greenberg, Esq.

Telecopier: 212-735-2000

and

Rosenberg, Hacohen, Goddard & Ephrat

24 Raoul Wallenberg Street

Tel-Aviv 69719

Israel

Attn: Dan Hacohen, Adv.

Telecopier: 972-3-766-6567

or to such other address or to the attention of such Person or Persons as the
recipient party has specified by prior written notice to the sending party (or
in the case of counsel, to such other readily ascertainable business address as
such counsel may hereafter maintain). If more than one method for sending
notice as set forth above is used, the earliest notice date established as set
forth above shall control.

11.           Captions. All captions contained in this Agreement are for convenience of
reference only, do not form a part of this Agreement and shall not affect in
any way the meaning or interpretation of this Agreement.

12.           Counterparts. This Agreement may be executed in counterparts, and either
party may execute such counterpart, both of which when executed and delivered
shall be deemed to be an original and which counterparts taken together shall
constitute but one and the same instrument.

13.           Severability; Enforcement. Any provision of this Agreement which is invalid
or unenforceable in any jurisdiction shall be ineffective to the extent of such
invalidity or unenforceability without invalidating or rendering unenforceable
the remaining provisions hereof, and any such invalidity or unenforceability in
any jurisdiction shall not invalidate or render unenforceable such provision in
any other jurisdiction.

14.           Specific Performance. The parties hereto agree that irreparable damage
would occur in the event that any provision of this Agreement were not
performed in accordance with its specific terms or were otherwise breached. It
is accordingly agreed that the parties shall be entitled to seek an injunction
or injunctions to prevent breaches of this Agreement and to enforce
specifically the terms and provisions hereof in any court of the United States
or any state having jurisdiction without the necessity of demonstrating damages
or posting a bond, this being in addition to any other remedy to which they are
entitled at law or in equity.

7

 

15.           Consent to Jurisdiction. Each party irrevocably submits to the exclusive
jurisdiction of any court of competent jurisdiction in the State of New York
for the purposes of any suit, action or other proceeding arising out of this
Agreement or any transaction contemplated hereby. Each party agrees to commence
any such action, suit or proceeding in any court of competent jurisdiction in
the State of New York. Each party further agrees that service of any process,
summons, notice or document by U.S. registered mail to such party’s respective
address set forth above shall be effective service of process for any action,
suit or proceeding in a court of competent jurisdiction in the State of New
York with respect to any matters to which it has submitted to jurisdiction in
this Section 15. Each party irrevocably and unconditionally waives any
objection to the laying of venue of any action, suit or proceeding arising out
of this Agreement or the transactions contemplated hereby in a court of
competent jurisdiction in the State of New York, and hereby further irrevocably
and unconditionally waives and agrees not to plead or claim in any such court
that any such action, suit or proceeding brought in any such court has been
brought in an inconvenient forum. EACH PARTY HEREBY IRREVOCABLY WAIVES ALL
RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED
ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR
THE ACTIONS OF SUCH PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND
ENFORCEMENT HEREOF.

16.           Governing Law. This Agreement shall be governed by and interpreted and
enforced in accordance with the laws of the State of New York, without giving
effect to any choice of law or conflict of laws rules or provisions (whether of
the State of New York or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of New York.

17.           Actions in Other Capacities. Nothing in this Agreement shall (i) limit,
restrict or otherwise affect any actions taken by Shareholder in his capacity
as an officer or member of the board of directors of the Company or any of its
subsidiaries or (ii) modify the Company’s rights under the Merger Agreement.

[Signature Page to Follow]

8

 

     IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto all as of the day and year first above written.

	 	 	 	 	 
	 	PERRIGO COMPANY

 	 
	 	By:  	/s/ David T. Gibbons
 	 
	 	 	Name:  	David T. Gibbons 	 
	 	 	Title:  	Chairman, President and Chief

Executive Officer 	 
	 

	 	 	 	 	 
	 	AGIS INDUSTRIES (1983) LTD.

 	 
	 	By:  	/s/ Moshe Arkin
 	 
	 	 	Name:  	Moshe Arkin 	 
	 	 	Title:  	President and Chairman 	 
	 

	 	 	 	 	 
	 	SHAREHOLDER

 	 
	 	/s/ Moshe Arkin
 	 
	 	(Signature) 	 
	 	 	 
	 

	 	 	 	 	 
	 	 	 
	 	                                 /s/ Moshe Arkin
 	 
	 	Print Name 	 
	 	 	 
	 

Number and class of shares of Capital Stock: 12,510,414 Common Shares

 

 

 

 

 

[Signature Page to Undertaking Agreement]

 

 

ANNEX A

IRREVOCABLE PROXY

     Capitalized terms used but not defined herein shall have the meaning
ascribed to such terms in the Undertaking Agreement, dated as of November 14,
2004, between Perrigo Company, a Michigan corporation, Agis Industries (1983)
Ltd., an Israeli public company (the “Company”), and the undersigned
Shareholder of the Company (the “Undertaking Agreement”). A copy of the
Undertaking Agreement is attached hereto and is incorporated by reference
herein.

     This Proxy is given to secure the performance of the duties of the
undersigned Shareholder pursuant to the Undertaking Agreement and is granted in
consideration of Buyer negotiating and entering into the Merger Agreement.

     The undersigned Shareholder hereby irrevocably appoints Douglas R. Schrank
and Todd W. Kingma, and each of them individually, the sole and exclusive
attorneys, agents and proxies, with full power of substitution in each of them,
for the undersigned Shareholder and in the name, place and stead of the
undersigned Shareholder, to vote or, if applicable, to give written consent,
with respect to, all Subject Shares Beneficially Owned by the undersigned
Shareholder and which the undersigned Shareholder is or may be entitled to vote
at any meeting of the Company held after the date hereof, whether annual or
special and whether or not an adjourned meeting, or, if applicable, to give
written consent with respect thereto, in accordance with the provisions of
Section 2(a) of the Undertaking Agreement as follows:

          (i) in favor of the Merger, the execution and delivery by the
Company of the Merger Agreement and the adoption and approval of the
Merger Agreement and the terms thereof, in favor of each of the other
actions contemplated by the Merger Agreement and in favor of any action
in furtherance of any of the foregoing;

          (ii) against any action or agreement that would reasonably be
expected to result in a breach of any representation, warranty, covenant
or obligation of the Company in the Merger Agreement; and

          (iii) against the following actions (other than the Merger and the
transactions contemplated by the Merger Agreement): (A) any extraordinary
corporate transaction, such as a merger, consolidation or other business
combination involving the Company or any subsidiary of the Company other
than, in the case of the Company, with any subsidiary of the Company and
in the case of any subsidiary of the Company, with the Company or any
subsidiary of the Company; (B) any sale, lease, sublease, license,
sublicense or transfer of a material portion of the rights or other
assets of the Company or any subsidiary of the Company other than, in the
case of the Company, to any subsidiary of the Company and in the case of
any subsidiary of the Company, to the Company or

 

 

any subsidiary of the Company; (C) any reorganization,
recapitalization, dissolution or liquidation of the Company or any
subsidiary of the Company; (D) any change in the individuals who serve as
members of the board of directors of the Company if such action would
reasonably be expected to materially impair or delay the ability of the
Company to consummate the Merger; (E) any amendment to the Company’s
certificate of incorporation or bylaws if such action would reasonably be
expected to materially impair or delay the ability of the Company to
consummate the Merger; (F) any material change in the capitalization of
the Company or the Company’s corporate structure; and (G) any other
action which is intended, or could reasonably be expected, to impede,
interfere with, delay, postpone, discourage or adversely affect the
Merger or any of the other transactions contemplated by the Merger
Agreement or the Undertaking Agreement.

     This Proxy is coupled with an interest, shall be irrevocable to the
fullest extent permitted by law and shall be binding on any successor in
interest of the undersigned Shareholder. This Proxy shall not be terminated by
operation of law upon the occurrence of any event, including, without
limitation, the death or incapacity of the undersigned Shareholder.

     This Proxy shall operate to revoke any prior proxy as to the Subject
Shares heretofore granted by the undersigned Shareholder with respect to the
subject matter of the Undertaking Agreement and the Merger Agreement.

     This Proxy shall terminate on the Expiration Date.

[Signature Page to Follow]

 

 

SIGNATURE TO IRREVOCABLE PROXY

	 	 	 	 	 
	 	SHAREHOLDER

 	 
	 	
 	 
	 	(Signature) 	 
	 	 	 
	 

	 	 	 	 	 
	 	 	 
	 	                                          Moshe Arkin
 	 
	 	Print Name 	 
	 	Date:  November 14, 2004 	 
	 

	 	 	 	 	 
	 	The undersigned, Douglas R. Schrank,

irrevocably accepts this Proxy and

agrees to act in accordance with its

terms.

 	 
	 	
 	 
	 	(Signature) 	 
	 	 	 
	 

	 	 	 	 	 
	 	 	 
	 	                                         Douglas R. Schrank
 	 
	 	Print Name 	 
	 	Date:  November 14, 2004 	 
	 

	 	 	 	 	 
	 	The undersigned, Todd W. Kingma,

irrevocably accepts this Proxy and

agrees to act in accordance with its

terms.

 	 
	 	
 	 
	 	(Signature) 	 
	 	 	 
	 

	 	 	 	 	 
	 	 	 
	 	
 Todd W. Kingma
 	 
	 	Print Name 	 
	 	Date:  November 14, 2004 	 
	 

 

 

[Signature Page to
Proxy—Moshe Arkin]

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