Section 382 Rights Agreement – Oculus Innovative Sciences

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section 382 rights agreementThe Section 382 Rights Agreement of OCULUS INNOVATIVE SCIENCES, INC. was approved by the Board of Directors of  on October 18, 2016. The Section 382 Rights Agreement provides for a dividend of one preferred stock purchase right, or a Right, for each share of common stock, par value $0.0001 per share, of the Company outstanding on November 1, 2016 — the Record Date.  Each Right entitles the holder to purchase from us one one-thousandth of a share of Series B Preferred Stock, par value $0.0001 per share, or the Preferred Stock, for a purchase price of $10.00, subject to adjustment as provided in the Section Rights Agreement. The description and terms of the Rights are set forth in the Section 382 Rights Agreement.

The board of directors adopted the Section Rights Agreement to prevent a potential limitation on the Company’s ability to use its net operating loss carryforwards, and other tax attributes.

Highlights of the Rights Agreement:Oculus Innovative Sciences

  • Flip-In Provision. When a person or group has become an Acquiring Person, the holder of each Right will thereafter have the right to receive, upon exercise of the Right and the payment of the Purchase Price, that number of 1/1000ths of a share of Preferred Stock equal to the number of shares of common stock which at the time of the applicable triggering transaction would have a market value of twice the Purchase Price. However, any Rights that are or previously were beneficially owned by an Acquiring Person will become null and void and will result in significant dilution to the Acquiring Person.
  • Flip-Over Provision. In the event the Company is acquired in a merger or other business combination by an Acquiring Person, or 50% or more of its assets are sold to an Acquiring Person, each Right will entitle its holder to purchase common shares in the surviving entity at 50% of the market price (subject to exceptions if the surviving entity does not have common shares registered under the Securities Exchange Act of 1934, including circumstances in which the surviving entity has common shares that publicly trade outside the United States, as further described in the Rights Agreement). As with the “flip-in” provision, any Rights that are or previously were beneficially owned by an Acquiring Person will become null and void.
  • A copy of the SECTION 382 Rights Agreement is available here – OCULUS INNOVATIVE SERVICES – RIGHTS AGREEMENT.


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