PAREXEL?S BOARD OF DIRECTORS APPROVES ADOPTION OF SHAREHOLDER RIGHTS PLAN
BOSTON, MA, March 27, 2003 — PAREXEL International Corporation (Nasdaq: PRXL) today announced that its Board of Directors has adopted a Shareholder Rights Plan. The Board adopted the Rights Plan as a safeguard against abusive takeover tactics that limit the ability of shareholders to realize the long-term value of their investment in PAREXEL and to ensure that all PAREXEL stockholders receive fair and equal treatment in the event of a takeover proposal.
The Board also voted to subject PAREXEL to Section 50A of the Massachusetts Business Corporation Law and to amend PAREXEL’s bylaws with respect to the calling of special meetings of stockholders. The Board elected to subject the Company to Section 50A in order to take advantage of the benefits afforded Massachusetts corporations under this provision of the state’s corporation law. Under Section 50A, members of PAREXEL’s Board of Directors, which is already classified into three classes, may be removed by stockholders only for cause. In addition, the number of directors of PAREXEL may be fixed only by the Board of Directors and Board vacancies may only be filled by a vote of directors then in office.
The Board’s decision to approve the Rights Plan and to take these actions is not in response to any specific effort to acquire control of PAREXEL, nor will the approval of these items prevent a takeover of PAREXEL.
Under the Rights Plan, one Right will be distributed as of the close of business on April 7, 2003 on each then outstanding share of PAREXEL common stock. Initially, the Rights will automatically trade with the underlying common stock and will not be exercisable. Subject to limited exceptions, the Rights will become exercisable if a person or group acquires 20 percent or more of PAREXEL common stock or commences a tender offer for 20 percent or more of PAREXEL’s outstanding common stock.
If the Rights become exercisable, the type and amount of securities receivable upon exercise of each Right will depend on the circumstances at the time of exercise. Each Right will initially entitle each stockholder to buy one one-thousandth of a share of newly created Series A Junior Participating Preferred Stock of PAREXEL at an exercise price of $98.00. If a person acquires 20 percent or more of PAREXEL’s common stock in a transaction that was not approved by PAREXEL’s Board of Directors, each Right, other than those owned by the acquiring person, would instead entitle its holder to purchase shares of PAREXEL common stock worth $196.00, two times the exercise price of the Right. If PAREXEL is involved in a merger or other transaction with another company in which it is not the surviving corporation, or transfers more than 50 percent of its assets to another company, in a transaction that was not approved by PAREXEL’s Board of Directors, then each Right, other than those owned by the acquiring person, would entitle its holder to purchase shares of common stock of the acquiring company worth $196.00, two times the exercise price of the Right.
PAREXEL’s Board of Directors may redeem the Rights at $0.001 per Right at any time until ten business days after a person has acquired 20 percent or more of the outstanding common stock. Unless the Rights are redeemed or exchanged earlier, they will expire on March 27, 2013. At least once every three years, a committee of independent directors will evaluate the Rights Agreement in order to consider whether the maintenance of the Rights Agreement continues to be in the interests of the Company and its stockholders.
A summary of the Rights Plan and the other actions taken by the Board will be included in a Form 8-K to be filed by PAREXEL with the SEC. Additional details regarding the Rights Plan will also be outlined in a summary to be mailed to all PAREXEL stockholders following the April 7, 2003 record date.
PAREXEL is one of the largest biopharmaceutical outsourcing organizations in the world, providing a broad range of knowledge-based contract research, medical marketing and consulting services to the worldwide pharmaceutical, biotechnology and medical device industries. With a commitment to providing solutions that expedite time-to-market and peak market penetration, PAREXEL has developed significant expertise in clinical trials management, data management, biostatistical analysis, medical marketing, clinical pharmacology, regulatory and medical consulting, industry training and publishing and other drug development consulting services. Its information technology subsidiary, Perceptive Informatics, Inc., provides a variety of technology products and services, including web-based portal solutions and voice and data systems, and the use and interpretation of medical images as clinical trial endpoints, which are designed to accelerate and enhance the clinical development and launch processes. The Company’s integrated services, therapeutic area depth and sophisticated information technology, along with its experience in global drug development and product launch services, represent key competitive strengths. Headquartered near Boston, MA, PAREXEL operates in 58 locations throughout 35 countries around the world, and has approximately 4,970 employees.