--------------------------------------------------------------------------------
RIGHTS AGREEMENT
between
THE XXXXXXXX AND XXXXXXXX COMPANY
and
XXXXX FARGO BANK MINNESOTA, N.A.
as Rights Agent
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Dated as of April 18, 2001
Table of Contents
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Page
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Section 1. Certain Definitions.................................................2
Section 2. Appointment of Rights Agent........................................10
Section 3. Issuance of Right Certificates.....................................11
Section 4. Form of Right Certificates.........................................13
Section 5. Countersignature and Registration..................................15
Section 6. Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or
Stolen Right Certificates.........................................16
Section 7. Exercise of Rights Purchase Price; Expiration Date of
Rights.............................................................17
Section 8. Cancellation and Destruction of Right Certificates.................21
Section 9. Reservation and Availability of Capital Stock......................21
Section 10. Preferred Share Record Date.......................................24
Section 11. Adjustment to Purchase Price, Number and Kind of
Shares or Number of Rights........................................25
Section 12. Certification of Certain Adjustments..............................39
Section 13. Consolidation, Merger or Sale or Transfer of Assets
or Earning Power..................................................40
Section 14. Fractional Rights and Fractional Shares...........................46
Section 15. Rights of Action..................................................48
Section 16. Agreement of Right Holders........................................49
Section 17. Right Certificate Holder Not Deemed a Shareholder.................50
Section 18. Concerning the Rights Agent.......................................51
Section 19. Merger or Consolidation or Change of Name of Rights
Agent.............................................................52
Section 20. Duties of Rights Agent............................................53
Section 21. Change of Rights Agent............................................56
Section 22. Issuance of New Right Certificates................................57
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Section 23. Redemption........................................................58
Section 24. Notice of Certain Events..........................................59
Section 25. Notices...........................................................60
Section 26. Supplements and Amendments........................................61
Section 27. Successors........................................................63
Section 28. Determinations and Actions Taken by the Board of
Directors.........................................................63
Section 29. Benefits of this Agreement........................................63
Section 30. Governing Law.....................................................64
Section 31. Counterparts......................................................64
Section 32. Descriptive Headings..............................................64
Section 33. Severability......................................................64
Section 34. Exchange..........................................................65
Exhibit A - Form of Certificate of Amendment to Amended Articles of
Incorporation
Exhibit B - Form of Right Certificate
Exhibit C - Form of Summary of Rights
ii
RIGHTS AGREEMENT
RIGHTS AGREEMENT dated as of April 18, 2001 (the "Agreement")
between The Xxxxxxxx and Xxxxxxxx Company, an Ohio corporation (the "Company"),
and Xxxxx Fargo Bank Minnesota, N.A., a national banking association (the
"Rights Agent").
WITNESSETH
WHEREAS, on April 18, 2001 (the "Rights Dividend Declaration
Date"), the Board of Directors of the Company (the "Board") authorized and
declared a dividend distribution of one (1) right (a "Right") for each share of
the Company's Class A Common Shares, no par value per share (the "Class A
Shares"), and one-twentieth (1/20th) of a Right for each share of the Company's
Class B Common Shares, no par value per share (the "Class B Shares"),
outstanding as of the Close of Business (as hereinafter defined) on May 6, 2001
(the "Record Date"), each Right initially representing the right to purchase one
one-thousandth (1/1000th) of a share (a "Unit") of the Company's Series B
Participating Preferred Shares (the "Preferred Shares", as defined hereinafter)
upon the terms and subject to the conditions hereinafter set forth; and
authorized the issuance of one (1) Right (subject to adjustment) with respect to
each Class A Share and one-twentieth (1/20th) of a Right (subject to adjustment)
with respect to each Class B Share that shall become outstanding between the
Record Date and the earlier of the Distribution Date (as hereinafter defined) or
the Expiration Date (as hereinafter defined) and, to the extent provided in
Section 22 hereof, with respect to each such share issued after the Distribution
Date and prior to the Expiration Date; and
WHEREAS, the Company desires to set forth certain terms and
conditions governing the Rights;
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein set forth, the parties hereby agree as follows:
Section 1. Certain Definitions. For purposes of this
Agreement, the following terms have the meanings indicated:
(a) "Acquiring Person" shall mean any Person (as hereinafter
defined) who or which, together with all Affiliates (as hereinafter
defined) and Associates (as hereinafter defined) of such Person, shall
be the Beneficial Owner (as hereinafter defined) of securities of the
Company constituting a Substantial Block (as hereinafter defined);
provided, however, that an Acquiring Person shall not include an Exempt
Person (as hereinafter defined).
Notwithstanding the foregoing, (A) no Person shall become an
Acquiring Person solely as the result of an acquisition of Class A
Shares by the Company that, by reducing the number of shares
outstanding, increases the proportionate number of Class A Shares
beneficially owned by a Person to equal or exceed a Substantial Block
of the Class A Shares then outstanding; provided, however, that if such
Person becomes the Beneficial Owner of a Substantial Block of Class A
Shares solely by reason of purchases of Class A Shares by the Company
and shall, after such purchases by the Company, become the Beneficial
Owner of any additional Class A Shares which has the effect of
increasing such Person's percentage ownership of the then-outstanding
Class A Shares by any means whatsoever, then such Person shall be
deemed to be an Acquiring Person, and (B) if the Board of Directors
determines that a Person who would otherwise be an Acquiring Person has
become such inadvertently (including, without limitation, because (1)
such Person was unaware that it beneficially owned a Substantial Block
of Class A Shares or
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(2) such Person was aware of the extent of such Beneficial Ownership
but such Person acquired Beneficial Ownership of such Class A Shares
without the intention to change or influence the control of the
Company) and such Person divests itself as promptly as practicable of a
sufficient number of Class A Shares so that such Person would no longer
be an Acquiring Person, then such Person shall not be deemed to be, or
have been, an Acquiring Person for any purposes of this Agreement, and
no Share Acquisition Date shall be deemed to have occurred. All
questions as to whether a Person who would otherwise be an Acquiring
Person has become such inadvertently shall be determined by the Board.
(b) "Adjustment Spread" shall have the meaning set forth in
Section 34(a)(ii) hereof.
(c) "Adjustment Units" shall have the meaning set forth in
Section 11(a)(ii) hereof.
(d) "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 in effect as
of the date hereof.
(e) "Agreement" shall have the meaning set forth in the first
paragraph hereof.
(f) A Person shall be deemed the "Beneficial Owner" of, and
shall be deemed to "beneficially own," any securities:
(i) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has the right to acquire
(whether such right is exercisable immediately or only after the
passage of time) pursuant to any agreement, arrangement or
understanding (whether or not in writing) or upon the
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exercise of any conversion, exchange or purchase rights, warrants
or options, or otherwise; provided, however, that a Person shall
not be deemed the "Beneficial Owner" of, or to "beneficially own,"
(A) securities tendered pursuant to a tender or exchange offer
made by or on behalf of such Person or any of such Person's
Affiliates or Associates until such tendered securities are
accepted for purchase or exchange; (B) securities issuable upon
the exercise of Rights at any time prior to the occurrence of a
Section 11(a)(ii) Event or a Section 13 Event (as such terms are
hereinafter defined); or (C) securities issuable from and after
the occurrence of a Section 11(a)(ii) Event or a Section 13 Event
upon the exercise of Original Rights or Rights acquired by such
Person or any of such Person's Affiliates or Associates pursuant
to Section 11(i) hereof in connection with any adjustment made
with respect to any Original Rights;
(ii) which such Person or any of such Person's Affiliates
or Associates, directly or indirectly, has the right to vote or
dispose of or has beneficial ownership of (as determined pursuant
to Rule 13d-3 of the General Rules and Regulations under the
Exchange Act), including pursuant to any agreement, arrangement or
understanding (whether or not in writing); provided, however, that
a Person shall not be deemed the "Beneficial Owner" of, or to
"beneficially own," any securities under this Section l(f)(ii) as
a result of an agreement, arrangement or understanding to vote
such security which: (A) arises solely by reason of the grant of a
revocable proxy or consent to any Person who shall have obtained
such proxy or consent pursuant to and as a result of a public
proxy or consent solicitation subject to and conducted in
accordance with the
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applicable provisions of the Exchange Act and the applicable rules
and regulations thereunder and (B) also is not then reportable by
such Person on Schedule 13D under the Exchange Act (or any
comparable or successor report); or
(iii) which are "beneficially owned," directly or
indirectly, by any other Person (or any Affiliate or Associate
thereof) with which such Person or any of such Person's Affiliates
or Associates has any agreement, arrangement or understanding
(whether or not in writing) for the purpose of acquiring, holding,
voting (except pursuant to a revocable proxy as described in
clause (A) of subparagraph (ii) of this Section l(f)) or disposing
of any securities of the Company; provided, however, that nothing
in this Section l(f) shall cause a Person engaged in business as
an underwriter of securities to be the "Beneficial Owner"
of, or to "beneficially own," any securities acquired through such
Person's participation in good faith in a firm commitment
underwriting until the expiration of forty (40) days after the
date of such acquisition.
(g) "Board" shall have the meaning set forth in the WHEREAS
clause at the beginning of this Agreement.
(h) "Business Day" shall mean any day other than a Saturday,
Sunday or day on which banking institutions in the State of Ohio are
authorized or obligated by law or executive order to close.
(i) "Certificate of Amendment" shall mean the Certificate of
Amendment to Amended Articles of Incorporation setting forth the
express terms and provisions of the Preferred Shares, a form of which
is attached hereto as Exhibit A.
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(j) "Class A Shares" shall have the meaning set forth in the
WHEREAS clause at the beginning of this Agreement.
(k) "Class B Shares" shall have the meaning set forth in the
WHEREAS clause at the beginning of this Agreement.
(l) "Close of Business" on any given date shall mean 5:00
P.M., Dayton, Ohio time, on such date; provided, however, that if such
date is not a Business Day, it shall mean 5:00 P.M., Dayton, Ohio time,
on the next succeeding Business Day.
(m) "Common Shares" when used with reference to the Company
shall mean the Class A Shares and the Class B Shares or any other
shares of capital stock of the Company into which such stock shall be
reclassified or changed. "Common Shares" when used with reference to
any Person that is organized in corporate form, other than the Company,
shall mean the capital stock or other equity security with the greatest
voting power, or the equity securities or other equity interest having
power to control or direct the management, of such Person or, if such
Person is a Subsidiary of another Person, the Person or Persons which
ultimately control such first-mentioned Person and which has issued any
such outstanding capital stock, equity securities or equity interest.
"Common Shares" when used with reference to any Person that is not be
organized in corporate form shall mean units of beneficial interest
which (i) shall represent the right to participate generally in the
profits and losses of such Person (including, without limitation, any
flow-through tax benefits resulting from an ownership interest in such
Person) and (ii) shall be entitled to exercise the greatest voting
power of such Person or, in the case of a limited partnership, shall
have the power to remove the general partner or partners.
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(n) "Company" shall have the meaning set forth in the first
paragraph of this Agreement.
(o) "Current Market Price" shall have the meaning set forth in
Section 11(d) hereof.
(p) "Current Value" shall have the meaning set forth in
Section 11(a)(iii) hereof.
(q) "Distribution Date" shall have the meaning set forth in
Section 3(a) hereof.
(r) "Equivalent Preference Shares" shall have the meaning set
forth in Section 11(b) hereof.
(s) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended.
(t) "Exempt Person" shall mean (i) the Company, (ii) any
Subsidiary (as hereinafter defined) of the Company, and (iii) any
employee benefit plan or employee stock plan of the Company or of any
Subsidiary of the Company or any Person organized, appointed,
established or holding Common Shares by, for or pursuant to, the terms
of any such plan.
(u) "Expiration Date" shall have the meaning set forth in
Section 7(a) hereof.
(v) "Final Expiration Date" shall have the meaning set forth
in Section 7(a) hereof.
(w) "NASDAQ" shall mean the National Association of Securities
Dealers Automated Quotations.
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(x) "Original Rights" shall mean Rights which were acquired by
a Person or any of such Person's Affiliates or Associates prior to the
Distribution Date or pursuant to Section 3(a), 3(c) or Section 22
hereof.
(y) "Person" shall mean any individual, firm, corporation,
partnership, limited liability company, association, unincorporated
organization, trust or other entity, as well as any syndicate or group
deemed to be a person under Section 14(d)(2) of the Exchange Act, and
shall include any successor (by merger or otherwise) of such entity.
(z) "Preferred Shares" shall mean the Series B Participating
Preferred Shares, no par value per share, of the Company having the
voting powers, designation, preferences and rights and qualifications,
limitations and restrictions set forth in the Certificate of Amendment,
a form of which is attached hereto as Exhibit A.
(aa) "Principal Party" shall have the meaning set forth in
Section 13(b) hereof.
(bb) "Purchase Price" shall have the meaning set forth in
Section 4(a) hereof as adjusted pursuant to Section 11(a)(ii) and
Section 13(a) hereof.
(cc) "Record Date" shall have the meaning set forth in the
WHEREAS clause at the beginning of this Agreement.
(dd) "Redemption Price" shall have the meaning set forth in
Section 23(a) hereof.
(ee) "Right" shall have the meaning set forth in the WHEREAS
clause at the beginning of this Agreement.
(ff) "Right Certificate" shall have the meaning set forth in
Section 3(a) hereof.
(gg) "Rights Agent" shall have the meaning set forth in the
first paragraph of this Agreement.
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(hh) "Rights Dividend Declaration Date" shall have the meaning
set forth in the WHEREAS clause at the beginning of this Agreement.
(ii) "Schedule 13G Filer" shall mean any Person who satisfies
both of the criteria set forth in Rule 13d-1(b)(1)(i) and Rule
13d-1(b)(1)(ii) of the General Rules and Regulations under the Exchange
Act as in effect on the date of this Agreement, and who has reported
such ownership on Schedule 13G (or any comparable or successor report)
under the Exchange Act, in each case, as determined by the Board.
(jj) "Section 11(a)(ii) Event" shall have the meaning set
forth in Section 11(a)(ii) hereof.
(kk) "Section 11(a)(ii) Trigger Date" shall have the meaning
set forth in Section 11(a)(iii) hereof.
(ll) "Section 13 Event" shall have the meaning set forth in
Section 13(a) hereof.
(mm) "Section 34(a)(i) Exchange Ratio" has the meaning set
forth in Section 34(a)(i) hereof.
(nn) "Section 34(a)(ii) Exchange Ratio" has the meaning set
forth in Section 34(a)(ii) hereof.
(oo) "Securities Act" shall mean the Securities Act of 1933,
as amended.
(pp) "Spread" shall have the meaning set forth in Section
11(a)(iii) hereof.
(qq) "Stock Acquisition Date" shall mean the first date of
public announcement (which, for purposes of this definition, shall
include, without limitation, a report filed pursuant to Section 13(d)
under the Exchange Act) by the Company or an Acquiring Person that an
Acquiring Person has become such.
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(rr) "Subsidiary" shall mean, with respect to any Person, any
corporation or other entity of which securities or other ownership
interests having ordinary voting power sufficient, in the absence of
contingencies, to elect a majority of the board of directors or other
persons performing similar functions are at the time directly or
indirectly beneficially owned, or otherwise controlled, by such Person
and any Affiliate of such Person.
(ss) "Substantial Block" shall mean 15% or more in number of
the outstanding Class A Shares; provided, however, that, for any
Schedule 13G Filer (as defined herein), a "Substantial Block" shall
mean 20% or more in number of the outstanding Class A Shares.
(tt) "Substitution Period" shall have the meaning set forth in
Section 11(a)(iii) hereof.
(uu) "Summary of Rights" shall have the meaning set forth in
Section 3(b) hereof.
(vv) "Trading Day" shall have the meaning set forth in Section
11(d)(i) hereof.
(ww) "Unit" shall have the meaning set forth in the WHEREAS
clause at the beginning of this Agreement.
Section 2. Appointment of Rights Agent. The Company hereby
appoints the Rights Agent to act as agent for the Company and the holders of the
Rights (who or which, in accordance with Section 3 hereof, shall prior to the
Distribution Date also be the holders of Common Shares of the Company) in
accordance with the terms and conditions hereof, and the Rights Agent hereby
accepts such appointment. The Company may from time to time act as Co-Rights
Agent or appoint such Co-Rights Agents as it may deem necessary or desirable.
Any
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actions which may be taken by the Rights Agent pursuant to the terms of this
Agreement may be taken by any such Co-Rights Agent.
Section 3. Issuance of Right Certificates.
(a) Until the earlier of the Close of Business on (i) the
tenth Business Day (or, if such tenth Business Day occurs before the Record
Date, the Close of Business on the Record Date) after the Stock Acquisition Date
or (ii) the tenth Business Day (or, if such tenth Business Day occurs before the
Record Date, the Close of Business on the Record Date), or such specified or
unspecified later date as may be determined by action of the Board, after the
date that a tender or exchange offer by any Person (other than an Exempt Person)
is first published, sent or given within the meaning of Rule 14d-4(a) of the
General Rules and Regulations under the Exchange Act, if, upon consummation
thereof, such Person, together with its Affiliates and Associates, would be the
Beneficial Owner of a Substantial Block (irrespective of whether any shares are
actually purchased pursuant to such offer) (the earlier of the dates set forth
in clauses (i) and (ii) above being herein referred to as the "Distribution
Date"), (x) the Rights will be evidenced (subject to the provisions of paragraph
(b) of this Section 3) by the certificates for the Common Shares of the Company
registered in the names of the holders of the Common Shares of the Company
(which certificates for Common Shares of the Company shall be deemed also to be
certificates for Rights) and not by separate Right Certificates and (y) each
Right or fraction thereof will be transferable only in connection with the
transfer of the underlying Common Shares (including a transfer by the Company).
As promptly as practicable after the Distribution Date, the Rights Agent will
send, by first-class, postage-prepaid mail, to each record holder of the Common
Shares of the Company as of the Close of Business on the Distribution Date, as
shown by the records of the Company, at the address of such holder shown on such
records, one
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or more certificates for Rights, in substantially the form of Exhibit B hereto
(each such certificate, a "Right Certificate"), evidencing one (1) Right for
each Class A Share and one-twentieth (1/20th) of a Right for each Class B Share
so held, subject to adjustment as provided herein and to the provisions of
Section 14(a) hereof. As of and after the Close of Business on the Distribution
Date, the Rights will be evidenced solely by the Right Certificates.
(b) As promptly as practicable following the Record Date, the
Company will send a copy of a Summary of Rights to Purchase Preferred Shares, in
substantially the form attached hereto as Exhibit C (the "Summary of Rights"),
by first-class, postage-prepaid mail, to each record holder of its Common Shares
as of the Close of Business on the Record Date, at the address of such holder
shown on the records of the Company. With respect to certificates for the Common
Shares outstanding as of the Close of Business on the Record Date, until the
earlier of the Close of Business on the Distribution Date or the Expiration
Date, the Rights will be evidenced by such certificates for the Common Shares
together with the Summary of Rights and the registered holders of the Common
Shares shall also be the registered holders of the associated Rights. Until the
earlier of the Close of Business on the Distribution Date or the Expiration
Date, the surrender for transfer of any of the certificates for the Common
Shares of the Company in respect of which Rights have been issued, with or
without a copy of the Summary of Rights attached, shall also constitute the
transfer of the Rights associated with the Common Shares evidenced by such
certificates.
(c) Rights shall be issued in respect of all Common Shares of
the Company which shall become outstanding after the Record Date but prior to
the earlier of the Close of Business on the Distribution Date and the Expiration
Date, and, to the extent provided in Section 22 hereof, in respect of Common
Shares of the Company issued after the Close of Business on
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the Distribution Date and prior to the Expiration Date. Certificates for Common
Shares of the Company that shall become outstanding or be transferred after the
Record Date but prior to the earlier of the Close of Business on the
Distribution Date and the Expiration Date shall have impressed on, printed on,
written on or otherwise affixed to them the following legend:
This certificate also evidences and entitles the holder hereof to
certain Rights as set forth in the Rights Agreement between The
Xxxxxxxx and Xxxxxxxx Company and Xxxxx Fargo Bank Minnesota, N.A.,
dated as of April 18, 2001, as the same shall be amended from time to
time (the "Rights Agreement"), the terms of which are hereby
incorporated herein by reference and a copy of which is on file at the
principal executive offices of The Xxxxxxxx and Xxxxxxxx Company. Under
certain circumstances, as set forth in the Rights Agreement, such
Rights will be evidenced by separate certificates and will no longer be
evidenced by this certificate. The Xxxxxxxx and Xxxxxxxx Company will
mail to the holder of this certificate a copy of the Rights Agreement
(as in effect on the date of mailing) without charge within five days
after receipt of a written request therefor. Under certain
circumstances, as provided in the Rights Agreement, Rights beneficially
owned by an Acquiring Person or any Associate or Affiliate thereof (as
such terms are defined in the Rights Agreement), whether by or on
behalf of such Person or by any subsequent holder, may become null and
void. The Rights shall not be exercisable, and shall be void so long as
held, by a holder in any jurisdiction where the requisite qualification
to the issuance to such holder, or the exercise by such holder, of the
Rights in such jurisdiction shall not have been obtained or be
obtainable.
With respect to such certificates containing the foregoing legend, until the
earlier of the Close of Business on the Distribution Date and the Expiration
Date, the Rights associated with the Common Shares of the Company evidenced by
such certificates shall be evidenced by such certificates alone, and the
surrender for transfer of any such certificates shall also constitute the
surrender for transfer of the Rights associated with the Common Shares of the
Company evidenced by such certificates.
Section 4. Form of Right Certificates.
(a) The Right Certificates (and the forms of election to
purchase shares and of assignment to be printed on the reverse thereof) shall be
in substantially the form of Exhibit B
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hereto and may have such marks of identification or designation and such
legends, summaries or endorsements printed thereon as the Company may deem
appropriate and as are not inconsistent with the provisions of this Agreement,
or as may be required to comply with any applicable law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any stock
exchange on which the Rights may from time to time be listed, or to conform to
usage. Subject to the provisions of Section 11 and Section 22 hereof, the Right
Certificates, whenever distributed, shall be dated as of the Record Date and on
their face shall entitle the holders thereof to purchase such number of Units as
shall be set forth therein, as the same may from time to time be adjusted as
provided herein, at the price per Unit set forth therein, as the same may from
time to time be adjusted as provided herein (such exercise price per Unit, the
"Purchase Price").
(b) Any Right Certificate issued pursuant to Section 3(a) or
Section 22 hereof that evidences Rights beneficially owned by (i) an Acquiring
Person or any Associate or Affiliate of such Acquiring Person, (ii) a transferee
of any such Acquiring Person (or of any such Associate or Affiliate) who becomes
a transferee after the Acquiring Person becomes such or (iii) a transferee of an
Acquiring Person (or of any such Associate or Affiliate) who becomes a
transferee prior to or concurrently with the Acquiring Person becoming such and
receives such Rights pursuant to either (A) a transfer (whether or not for
consideration) from such Acquiring Person (or such Associate or Affiliate) to
holders of equity interests in such Acquiring Person (or such Associate or
Affiliate) or to any Person with whom such Acquiring Person (or such Associate
or Affiliate) has any continuing agreement, arrangement or understanding
regarding the transferred Rights or (B) a transfer which the Board has
determined is part of a plan, arrangement or understanding which has as a
primary purpose or effect avoidance of the provisions of Section 7(e) hereof,
and any Right Certificate issued pursuant to Section 6 or
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Section 11 hereof upon transfer, exchange, replacement or adjustment of any
other Right Certificate referred to in this sentence, shall contain (to the
extent feasible) the following legend:
The Rights evidenced by this Right Certificate are or were beneficially
owned by a Person who was or became an Acquiring Person or an Affiliate
or Associate of an Acquiring Person (as such terms are defined in the
Rights Agreement). Accordingly, under certain circumstances as provided
in the Rights Agreement, this Right Certificate and the Rights
evidenced hereby may become null and void as provided in Section 7(e)
of the Rights Agreement.
Section 5. Countersignature and Registration.
(a) The Right Certificates shall be executed on behalf of the
Company by its Chairman of the Board, President or any Vice President, either
manually or by facsimile, engraved, stamped or printed signature, and by the
Treasurer or any Assistant Treasurer or the Secretary or an Assistant Secretary
of the Company, either manually or by facsimile, engraved, stamped or printed
signature. The Right Certificates shall be countersigned, manually or by
facsimile, by the Rights Agent and shall not be valid for any purpose unless so
countersigned. Although any officer of the Company whose manual or facsimile
signature is affixed to any Right Certificate ceases to be such officer before
the Right Certificate is delivered, such Right Certificate shall be effective in
all respects when countersigned by the Rights Agent and delivered; and any Right
Certificate may be signed on behalf of the Company by any person who, at the
actual date of the execution of such Right Certificate, shall be a proper
officer of the Company to sign such Right Certificate, although at the date of
the execution of this Rights Agreement any such person was not such an officer.
(b) Following the Distribution Date, the Rights Agent will
keep or cause to be kept, at its principal office or offices designated as the
appropriate place for surrender of Right Certificates upon exercise or transfer,
books for registration and transfer of the Right Certificates
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issued hereunder. Such books shall show the names and addresses of the
respective holders of the Right Certificates, the number of Rights evidenced on
its face by each Right Certificate, the certificate number and the date of each
Right Certificate.
Section 6. Transfer, Split Up, Combination and Exchange of
Right Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates.
(a) Subject to the provisions of Section 4(b), Section 7(e)
and Section 14 hereof, at any time after the Close of Business on the
Distribution Date, and at or prior to the Expiration Date, any Right Certificate
or Right Certificates may be transferred, split up, combined or exchanged for
another Right Certificate or Right Certificates, entitling the registered holder
to purchase such number of Units (or other securities, cash or assets, as the
case may be) as the Right Certificate or Right Certificates surrendered then
entitled such holder (or former holder in the case of a transfer) to purchase.
Any registered holder desiring to transfer, split up, combine or exchange any
Right Certificate or Right Certificates shall make such request in writing
delivered to the Rights Agent, and shall surrender the Right Certificate or
Right Certificates to be transferred, split up, combined or exchanged at the
principal office or offices of the Rights Agent designated for such purpose.
Neither the Rights Agent nor the Company shall be obligated to take any action
whatsoever with respect to the transfer of any such surrendered Right
Certificate or Right Certificates until the registered holder shall have
completed and signed the certificate contained in the form of assignment on the
reverse side of such Right Certificate or Right Certificates and shall have
provided such additional evidence of the identity of the Beneficial Owner (or
former Beneficial Owner) or Affiliates or Associates thereof as the Company
shall reasonably request. Thereupon the Rights Agent shall, subject to Section
4(b), Section 7(e) and Section 14 hereof, countersign and deliver to the Person
entitled thereto a Right
16
Certificate or Right Certificates, as the case may be, as so requested. The
Company may require payment from the holders of Right Certificates of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer, split up, combination or exchange of such Right
Certificates.
(b) Upon receipt by the Company and the Rights Agent of
evidence reasonably satisfactory to them of the loss, theft, destruction or
mutilation of a valid Right Certificate and of indemnity or security reasonably
satisfactory to them, and reimbursement to the Company and the Rights Agent of
all reasonable expenses incidental thereto, the Company will execute and deliver
a new Right Certificate of like tenor to the, Rights Agent for countersignature
and delivery to the registered owner in lieu of the Right Certificate so lost,
stolen, destroyed or mutilated.
Section 7. Exercise of Rights Purchase Price; Expiration Date
of Rights.
(a) Subject to Section 7(e) hereof, the registered holder of any Right
Certificate may exercise the Rights evidenced thereby (except as otherwise
provided herein including, without limitation, the restrictions on
exercisability set forth in Section 9(d), Section 11(a)(iii) and Section 23(a)
hereof) in whole or in part at any time on or after the Close of Business on the
Distribution Date upon surrender of the Right Certificate, with the form of
election to purchase and the certificate on the reverse side thereof duly
executed, to the Rights Agent at the principal office or offices of the Rights
Agent designated for such purpose, together with payment of the aggregate
Purchase Price for the total number of Units (or other securities, cash or
assets, as the case may be) as to which such surrendered Rights are exercised,
prior to the earliest of (i) the Close of Business on May 6, 2011 (the "Final
Expiration Date"), (ii) the time at which the Rights are redeemed as provided in
Section 23 hereof or (iii) the time at which the
17
Rights expire pursuant to Section 13(d) hereof (the earliest of the dates set
forth in clauses (i), (ii) and (iii) being herein referred to as the "Expiration
Date").
(b) The initial Purchase Price for each Unit shall be $105.00
and shall be subject to adjustment from time to time as provided in Section 11
and Section 13 hereof and shall be payable in lawful money of the United States
of America in accordance with paragraph (c) below.
(c) Upon receipt of a Right Certificate evidencing exercisable
Rights, with the form of election to purchase and certificate duly executed,
accompanied by payment (in cash, or by certified bank check or money order
payable to the order of the Company), with respect to the Rights so exercised,
of the Purchase Price (as such amount may be reduced pursuant to Section
11(a)(iii) hereof) for each Unit (or other securities, cash or assets, as the
case may be) to be purchased and an amount equal to any applicable transfer tax
required to be paid by the holder of the Rights pursuant hereto (in cash, or by
certified check or money order payable to the order of the Company), the Rights
Agent shall, subject to Section 7(f) hereof, (i) promptly (A) requisition from
any transfer agent of the Preferred Shares (or make available, if the Rights
Agent is the transfer agent for such shares) a certificate for the number of
Units to be purchased (and the Company hereby irrevocably authorizes and directs
its transfer agent to comply with all such requests), or (B) if the Company
shall have elected under Section 14(b) hereof to deposit the total number of
Preferred Shares issuable upon exercise of the Rights hereunder with a
depositary agent, requisition from the depositary agent depositary receipts
evidencing interests in such number of Units as are to be purchased (in which
case certificates for the Preferred Shares evidenced by such receipts shall be
deposited by the transfer agent with the depositary agent) and the Company
hereby authorizes and directs the depositary agent to comply with such request,
(ii)
18
if and when appropriate, requisition from the Company the amount of cash to be
paid in lieu of issuance of fractional shares in accordance with Section 14
hereof, (iii) promptly after receipt of such Preferred Shares certificates or
depositary receipts, cause the same to be delivered to or upon the order of the
registered holder of such Right Certificate, registered in such name or names as
may be designated by such holder, and (iv) if and when appropriate, after
receipt thereof, promptly deliver any such cash to be paid in lieu of issuance
of fractional shares to or upon the order of the registered holder of such Right
Certificate; provided, however, that in the case of a purchase of securities
other than Preferred Shares, the Rights Agent shall promptly take the
appropriate actions with respect to such securities to be purchased as shall as
nearly as practicable correspond to the actions described in the foregoing
clauses (i) through (iv). In the event that the Company is obligated to issue
other securities of the Company (including Common Shares), pay cash or
distribute assets pursuant to Section 11(a) hereof, the Company will make all
arrangements necessary so that such other securities, cash or assets are
available for distribution by the Rights Agent, if and when appropriate. The
Company reserves the right, but shall not be obligated, to require prior to the
occurrence of a Section 11(a)(ii) Event or a Section 13 Event that, upon any
exercise of Rights, such number of Rights be exercised so that only whole
Preferred Shares would be issued.
(d) In case the registered holder of any Right Certificate
shall exercise less than all the Rights evidenced thereby, a new Right
Certificate evidencing rights equivalent to the Rights remaining unexercised
shall be issued by the Rights Agent and delivered to, or upon the order of, the
registered holder of such Right Certificate, registered in such name or names as
may be designated by such holder, subject to the provisions of Section 14
hereof.
19
(e) Notwithstanding anything in this Agreement to the
contrary, from and after the first occurrence of a Section 11(a)(ii) Event, the
Right beneficially owned by (i) an Acquiring Person or any Associate or
Affiliate of such Acquiring Person or (ii) a transferee of any such Acquiring
Person (or of any such Associate or Affiliate) who becomes a transferee (A)
after such Acquiring Person becomes such or (B) prior to or concurrently with
the Acquiring Person becoming such and receives such Rights pursuant to either
(1) a transfer (whether or not for consideration) from such Acquiring Person (or
such Associate or Affiliate) to holders of equity interests in such Acquiring
Person (or such Associate or Affiliate) or to any Person with whom such
Acquiring Person (or such Associate or Affiliate) has any continuing agreement,
arrangement or understanding regarding the transferred Rights or (2) a transfer
which the Board has determined is part of a plan, arrangement or understanding
which has as a primary purpose or effect the avoidance of this Section 7(e),
shall become null and void without any further action, and no holder of such
Rights shall have any rights whatsoever with respect to such Rights, whether
under any provision of this Agreement or otherwise. The Company shall use
reasonable efforts to insure that the provisions of Section 4(b) hereof and this
Section 7(e) are complied with, but shall have no liability to any holder of
Right Certificates or other Person as a result of its failure to make any
determinations with respect to an Acquiring Person or any of the Affiliates,
Associates or transferees thereof hereunder.
(f) Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Company shall be obligated to
undertake any action with respect to a registered holder of any Right
Certificate upon the occurrence of any purported exercise as set forth in this
Section 7 unless such registered holder shall have (i) completed and signed the
certificate contained in the form of assignment or election to purchase set
forth on the reverse
20
side of the Right Certificate surrendered for such assignment or exercise and
(ii) provided such additional evidence of the identity of the Beneficial Owner
(or former Beneficial Owner) of the Rights evidenced by such Right Certificate
or Affiliates or Associates thereof as the Company shall reasonably request.
Section 8. Cancellation and Destruction of Right Certificates.
All Right Certificates surrendered for the purpose of exercise, transfer, split
up, combination or exchange shall, if surrendered to the Company or to any of
its agents, be delivered to the Rights Agent for cancellation or in cancelled
form, or, if surrendered to the Rights Agent, shall be cancelled by it, and no
Right Certificates shall be issued in lieu thereof except as expressly permitted
by this Agreement. The Company shall deliver to the Rights Agent for
cancellation and retirement, and the Rights Agent shall so cancel and retire,
any other Right Certificate purchased or acquired by the Company otherwise than
upon the exercise thereof. The Rights Agent shall deliver all cancelled Right
Certificates to the Company, or shall, at the written request of the Company and
after any Securities and Exchange Commission required retention period, destroy
such cancelled Right Certificates and, in such case, shall deliver a certificate
of destruction thereof to the Company.
Section 9. Reservation and Availability of Capital Stock.
(a) The Company covenants and agrees that it shall cause to be
reserved and kept available out of its authorized and unissued Preferred Shares
(and, if necessary, out of its authorized and unissued Common Shares or other
securities or out of its authorized and issued shares held in its treasury), the
number of Preferred Shares (and, if necessary, Common Shares of the Company or
other securities) that, as provided in this Agreement (including without
21
limitation Section 11(a)(iii) hereof), will be sufficient to permit the exercise
in full of all outstanding Rights.
(b) The Company covenants and agrees to take all such action
as may be necessary to insure that all Preferred Shares (and, if necessary,
Common Shares of the Company or other securities) delivered upon exercise of
Rights shall, at the time of delivery of the certificates for such shares
(subject to payment of the Purchase Price), be duly and validly authorized and
issued and fully paid and nonassessable.
(c) The Company covenants and agrees that, except as set forth
in Section 6 hereof, it will pay when due and payable any and all federal and
state transfer taxes and charges which may be payable in respect of the issuance
or delivery of the Right Certificates or of any certificates evidencing
Preferred Shares (or Common Shares of the Company or other securities, as the
case may be) upon the exercise of Rights. The Company shall not, however, be
required to pay any transfer tax which may be payable in respect of any transfer
or delivery of Right Certificates to a Person other than, or the issuance or
delivery of certificates or depositary receipts evidencing interests in a number
of Preferred Shares (or Common Shares of the Company or other securities, as the
case may be) in a name other than that of, the registered holder of the Right
Certificate evidencing Rights surrendered for exercise or to issue or deliver
any certificates evidencing Preferred Shares (or Common Shares of the Company or
other securities, as the case may be) or depositary receipts evidencing
interests in Preferred Shares in a name other than that of the registered holder
upon the exercise of any Rights until any such tax shall have been paid (any
such tax being payable by the holder of such Right Certificate at the time of
surrender) or until it has been established to the Company's satisfaction that
no such tax is due.
22
(d) The Company shall use its best efforts to (i) file, as
soon as practicable following the earliest date after the first occurrence of a
Section 11(a)(ii) Event or a Section 13 Event in which the consideration to be
delivered by the Company upon exercise of the Rights has been determined in
accordance with this Agreement, or as soon as is required by law following the
Distribution Date, as the case may be, a registration statement under the
Securities Act with respect to the securities purchasable upon exercise of the
Rights on an appropriate form, (ii) cause such registration statement to become
effective as soon as practicable after such filing and (iii) cause such
registration statement to remain effective (with a prospectus at all times
meeting the requirements of the Securities Act) until the earlier of (A) the
date as of which the Rights are no longer exercisable for such securities or (B)
the Expiration Date. The Company will also take such action as may be
appropriate under, or to ensure compliance with, the securities or "blue sky"
laws of the various states in connection with the exercisability of the Rights.
The Company may, acting by resolution of its Board, temporarily suspend, for a
period of time not to exceed ninety (90) days after the date set forth in clause
(i) of the first sentence of this Section 9(d), the exercisability of the Rights
in order to prepare and file such registration statement and permit it to become
effective. Upon any such suspension, the Company shall issue a public
announcement stating that the exercisability of the Rights has been suspended,
as well as a public announcement at such time as the suspension is no longer in
effect. Notwithstanding any provision of this Agreement to the contrary, the
Rights shall not be exercisable in any jurisdiction if the requisite
qualification in such jurisdiction shall not have been obtained, the exercise
thereof shall not be permitted under applicable law or a registration statement
shall not have been declared effective.
23
(e) So long as the Preferred Shares (and, where applicable,
any Common Shares of the Company or other securities) issuable and deliverable
upon the exercise of the Rights may be listed on any national securities
exchange, the Company shall use its best efforts to cause, from and after such
time as the Rights become exercisable, all Preferred Shares reserved for such
issuance to be listed on such exchange upon official notice of issuance upon
such exercise.
Section 10. Preferred Share Record Date. Each Person in whose
name any certificate for a number of Preferred Shares (or Common Shares of the
Company or other securities, as the case may be) is issued upon the exercise of
Rights shall for all purposes be deemed to have become the holder of record of
Preferred Shares (or Common Shares of the Company or other securities, as the
case may be) evidenced thereby on, and such certificate shall be dated, the date
upon which the Right Certificate evidencing such Rights was duly surrendered and
payment of the Purchase Price (and all applicable transfer taxes) was made;
provided, however, that if the date of such surrender and payment is a date on
which the Company's transfer books for the Preferred Shares (or Common Shares of
the Company or other securities, as the case may be) are closed, such Person
shall be deemed to have become the record holder of such shares (fractional or
otherwise) on, and such certificate shall be dated, the next succeeding Business
Day on which the Company's transfer books for the Preferred Shares (or Common
Shares of the Company or other securities, as the case may be) are open; and
provided further, however, that if delivery of the Units is delayed as a result
of a failure to register such Units pursuant to Section 9(c), such Persons shall
be deemed to have become the record holders of such Units only when such Units
first become deliverable. Prior to the exercise of the Rights evidenced thereby,
the holder of a Right Certificate shall not be entitled to any rights of a
24
shareholder of the Company with respect to shares for which the Rights shall be
exercisable, except as provided in Section 17 hereof.
Section 11. Adjustment to Purchase Price, Number and Kind of
Shares or Number of Rights. The Purchase Price and the number and kind of
shares, or fractions thereof, subject to purchase upon the exercise of each
Right and the number of Rights outstanding are subject to adjustment from time
to time as provided in this Section 11.
(a) (i) In the event the Company shall at any time after the
date of this Agreement (A) declare a dividend or distribution on the
Preferred Shares payable in Preferred Shares, (B) subdivide or split
the outstanding Preferred Shares into a greater number of shares, (C)
combine or consolidate the outstanding Preferred Shares into a smaller
number of shares or effect a reverse split of the outstanding Preferred
Shares or (D) issue any Preferred Shares in a reclassification of the
capital stock of the Company (including any such reclassification in
connection with a consolidation or merger in which the Company is the
continuing or surviving corporation), except as otherwise provided in
Section 7(e) hereof and this Section 11(a), the Purchase Price in
effect at the time of the record date for such dividend or distribution
or of the effective date of such subdivision, combination or
reclassification, and the number of Units issuable per Right on such
date, shall be adjusted so that the holder of any Right exercised after
such time shall be entitled to receive, upon payment of the Purchase
Price then in effect, the aggregate number of Units which, if such
Right had been exercised immediately prior to such date and exercised
at a time when the transfer books for the Preferred Shares were open,
such holder would have owned upon such exercise and been entitled to
receive by virtue of such dividend, distribution, subdivision,
combination or reclassification.
25
If an event occurs which would require an adjustment under
both this Section 11(a)(i) and Section 11(a)(ii) hereof, the adjustment
provided for in this Section 11(a)(i) shall be in addition to, and
shall be made prior to, any adjustment required pursuant to Section
11(a)(ii) hereof.
(ii) In the event (a "Section 11(a)(ii) Event") that any
Person (other than an Exempt Person), alone or together with its
Affiliates and Associates (other than an Exempt Person), shall, at any
time after the date of this Agreement, become the Beneficial Owner of a
Substantial Block, unless the event causing such threshold to be
crossed is an acquisition of beneficial ownership of Class A Shares
pursuant to a tender or exchange offer for all outstanding Class A
Shares at a price and on terms determined by the Board, after receiving
advice from one or more investment banking firms, to be (A) a price
which is fair to the holders of Class A Shares (taking into account all
factors which the Board deems relevant, including, without limitation,
prices which could reasonably be achieved if the Company or its assets
were sold on an orderly basis designed to realize maximum value) and
(B) otherwise in the best interests of the Company and its
shareholders, then, promptly following the first occurrence of any such
Section 11(a)(ii) Event, proper provision shall be made to adjust the
Rights so that each holder of a Right, except as provided below and in
Section 7(e) hereof, shall thereafter have the right to receive, upon
exercise thereof at the then current Purchase Price in accordance with
the terms of this Agreement, such number of Units as shall equal the
result obtained by (x) multiplying the then current Purchase Price by
the number of Units for which a Right was exercisable immediately prior
to the first occurrence of such Section 11(a)(ii) Event, whether or not
such Right was then exercisable, and (y) dividing
26
that product (which product, following such first occurrence, as the
same may be adjusted as provided herein, shall thereafter be referred
to as the "Purchase Price" for each Right (regardless of the number of
Units purchasable upon the exercise of a Right) and for all purposes of
this Agreement) by 50% of the Current Market Price of one Unit on the
date of such first occurrence (such number of Units being hereinafter
referred to as the "Adjustment Units").
(iii) In lieu of issuing Units in accordance with Section
11(a)(ii) hereof, the Company, acting by resolution of its Board, may,
and, in the event that the number of Preferred Shares which is
authorized by the Company's Amended Articles of Incorporation but not
outstanding or reserved for issuance for purposes other than upon
exercise of the Rights is not sufficient to permit exercise in full of
the Rights in accordance with Section 11(a)(ii) hereof, the Company,
acting by resolution of its Board, shall (A) determine the excess of
(1) the value of the Adjustment Units issuable upon the exercise of a
Right (the "Current Value") over (2) the Purchase Price attributable to
each Right (such excess being hereinafter referred to as the "Spread")
and (B) with respect to each Right (subject to Section 7(e) hereof),
make adequate provision to substitute for the Adjustment Units, upon
payment of the applicable Purchase Price, (1) cash, (2) a reduction in
the Purchase Price, (3) Common Shares or other equity securities of the
Company, (4) debt securities of the Company, (5) other assets or (6)
any combination of the foregoing which, when added to any Units issued
upon such exercise, have an aggregate value equal to the Current Value,
where such aggregate value has been determined by action of the Board
based upon the advice of a nationally recognized investment banking
firm selected by the Board; provided, however, if the Company shall
27
not have made adequate provision to deliver value pursuant to clause
(B) above within thirty (30) days following the later of (x) the first
occurrence of a Section 11(a)(ii) Event and (y) the date on which the
Company's right of redemption pursuant to Section 23 hereof, as such
date may be amended pursuant to Section 26 hereof, expires (the later
of (x) and (y) being referred to herein as the "Section 11(a)(ii)
Trigger Date"), then the Company shall be obligated to deliver, upon
the surrender for exercise of a Right and without requiring payment of
the Purchase Price, Units or Common Shares of the Company (to the
extent available) and then, if necessary, cash, which shares or cash
have an aggregate value equal to the Spread. If, after the occurrence
of a Section 11(a)(ii) Event, the number of Preferred Shares that is
authorized by the Company's Amended Articles of Incorporation but not
outstanding or reserved for issuance for purposes other than upon
exercise of the Rights are not sufficient to permit exercise in full of
the Rights in accordance with Section 11(a)(ii) hereof and the Company,
acting by resolution of its Board, shall determine in good faith that
it is likely that sufficient additional Preferred Shares could be
authorized for issuance upon exercise in full of the Rights, the thirty
(30) day period set forth above may be extended to the extent
necessary, but not beyond the Expiration Date or more than ninety (90)
days after the Section 11(a)(ii) Trigger Date, in order that the
Company may seek shareholder approval for the authorization of such
additional shares (such period as it may be extended, the "Substitution
Period"). To the extent that the Company determines that some action is
to be taken pursuant to the first or second sentence of this Section
11(a)(iii), the Company (x) shall provide, subject to Section 7(e)
hereof, that such action shall apply uniformly to all outstanding
Rights and (y) may suspend the exercisability of the Rights until the
expiration of the Substitution
28
Period in order to seek such shareholder approval for the authorization
of additional shares or to decide the appropriate form of distribution
to be made pursuant to the first sentence of this Section 11(a)(iii)
and to determine the value thereof. In the event of any such
suspension, the Company shall issue a public announcement stating that
the exercisability of the Rights has been temporarily suspended, as
well as a public announcement at such time as the suspension is no
longer in effect. For purposes of this Section 11(a)(iii), the value of
each Unit shall be the Current Market Price of one Unit on the date of
the first occurrence of the Section 11(a)(ii) Trigger Date.
(b) In the event that the Company shall at any time after the
date of this Agreement fix a record date for the issuance of rights, options or
warrants to all holders of Preferred Shares entitling them (for a period
expiring within forty-five (45) calendar days after such record date) to
subscribe for or purchase Preferred Shares (or shares having substantially the
same rights, privileges and preferences as the Preferred Shares ("Equivalent
Preference Shares")) or securities convertible into Preferred Shares or
Equivalent Preference Shares at a price per Preferred Share or Equivalent
Preference Share (or having a conversion price per share, if a security
convertible into Preferred Shares or Equivalent Preference Shares) less than the
Current Market Price per Preferred Share on such record date, the Purchase Price
to be in effect after such record date shall be determined by multiplying the
Purchase Price in effect immediately prior to such record date by a fraction, of
which the numerator shall be the number of Preferred Shares outstanding on such
record date plus the number of additional Preferred Shares or Equivalent
Preference Shares which the aggregate subscription or purchase price of the
total number of Preferred Shares or Equivalent Preference Shares so to be
offered (or the aggregate initial conversion price of the convertible securities
so to be offered) would purchase
29
at such Current Market Price, and of which the denominator shall be the number
of Preferred Shares outstanding on such record date plus the number of
additional Preferred Shares or Equivalent Preference Shares to be offered for
subscription or purchase (or into which the convertible securities so to be
offered are initially convertible). In case such subscription price may be paid
by delivery of consideration part or all of which may be in a form other than
cash, the value of such consideration shall be as determined in good faith by
the Board, whose determination shall be described in a statement filed with the
Rights Agent. Such adjustments shall be made successively whenever such a record
date is fixed; and in the event that such rights, options or warrants are not
issued, the Purchase Price shall again be adjusted to be the Purchase Price
which would then be in effect if such record date had not been fixed.
(c) In case the Company shall fix a record date for the making
of a distribution to all holders of Preferred Shares (including any such
distribution made in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation or any reclassification of
the Preferred Shares) of evidences of indebtedness, cash or assets (other than a
regular periodic cash dividend or a dividend or distribution payable in
Preferred Shares) or subscription or other rights, options or warrants
(excluding those referred to in Section 11(b) hereof), the Purchase Price to be
in effect after such record date shall be determined by multiplying the Purchase
Price in effect immediately prior to such record date by a fraction, of which
the numerator shall be the Current Market Price per Preferred Share on such
record date, less the fair market value (as determined in good faith by the
Board, whose determination shall be described in a statement filed with the
Rights Agent) of the portion of the assets, cash or evidences of indebtedness so
to be distributed or of such subscription or other rights, options or warrants
applicable to one Preferred Share, and of which the denominator shall
30
be such Current Market Price per Preferred Share; provided that the Purchase
Price shall not be reduced below zero. Such adjustments shall be made
successively whenever such a record date is fixed, and in the event that such
distribution is not so made, the Purchase Price shall again be adjusted to be
the Purchase Price which would then be in effect if such record date had not
been fixed.
(d) (i) For the purpose of any computation hereunder (other
than computations made pursuant to Section 11(a)(iii) hereof), the "Current
Market Price" per share of Preferred Stock on any date shall be deemed to be the
average of the daily closing prices per Preferred Share for the thirty (30)
consecutive Trading Days (as such term is defined in the last sentence of this
Section 11(d)(i)) immediately prior to such date and for the purposes of
computations made pursuant to Section 11(a)(iii) hereof, the "Current Market
Price" per Preferred Share on any date shall be deemed to be the average of the
daily closing prices per Preferred Share for the ten (10) consecutive Trading
Days immediately following such date; provided, however, that in the event that
the Current Market Price per Preferred Share is determined during a period
following the announcement by the Company of (a) a dividend or distribution on
the Preferred Shares payable in Preferred Shares or securities convertible into
Preferred Shares (other than the Rights) or (b) any subdivision, split,
combination, consolidation, reverse stock split or reclassification of the
Preferred Shares and prior to the expiration of the requisite thirty (30)
Trading Day or ten (10) Trading Day period, as set forth above, after the
ex-dividend date for such dividend or distribution, or the record date for such
subdivision, combination, consolidation or reclassification, as the case may be,
then, and in each such case, the Current Market Price shall be appropriately
adjusted to reflect ex-dividend trading. The closing price for any day shall be
the last sale price, regular way, or, in case no such sale takes
31
place on such day, the average of the closing bid and asked prices, regular way,
in either case as reported in the principal consolidated transaction reporting
system with respect to securities listed or admitted to trading on the New York
Stock Exchange or, if the Preferred Shares are not listed or admitted to trading
on the New York Stock Exchange, as reported in the principal consolidated
transaction reporting system with respect to securities listed on the principal
national securities exchange on which the Preferred Shares are listed or
admitted to trading or, if the Preferred Shares are not listed or admitted
trading on any national securities exchange, the last quoted price or, if not so
quoted, the average of the high bid and low asked prices in the over-the-counter
market, as reported by NASDAQ or such other system then in use, or, if on any
such date the Preferred Shares are not quoted by any such organization, the
average of the closing bid and asked prices as furnished by a professional
market maker making a market in Preferred Shares selected by the Board. If the
Current Market Price per Preferred Share cannot be determined in the manner
provided above or if the Preferred Shares are not publicly held or not so listed
or traded, the Current Market Price per Preferred Share shall be deemed to be an
amount equal to 1,000 (as such number may be appropriately adjusted for such
events as stock splits, stock dividends and recapitalizations with respect to
the Preferred Shares or Class A Shares of the Company occurring after the date
of this Agreement) multiplied by the Current Market Price per Class A Share. If
neither the Class A Shares nor the Preferred Shares are publicly held or so
listed or traded, the Current Market Price per Preferred Share shall mean the
fair value per share as determined in good faith by the Board, whose
determination shall be described in a statement filed with the Rights Agent. For
all purposes of this Agreement, the Current Market Price of one Unit shall be
equal to the Current Market Price of one Preferred Share divided by 1,000. The
term "Trading Day" shall mean a day on which the principal
32
national securities exchange on which the shares are listed or admitted to
trading is open for the transaction of business or, if the shares are not listed
or admitted to trading on any national securities exchange, a Business Day.
(ii) For the purpose of any computation hereunder, the Current
Market Price per Class A Share shall be determined in the same manner as set
forth for the Preferred Shares of the Company in Section 11(d)(i) hereof (other
than the fourth to last, third to last and penultimate sentences thereof). If
the Current Market Price per Class A Share cannot be determined in the manner
provided above, or if the Class A Shares are not publicly held or listed or
traded in a manner described in Section 11(d)(i) hereof, Current Market Price
per share shall mean the fair value per share as determined by a nationally
recognized investment banking firm selected by the Board, or, if no such
investment banking firm is in the good faith judgment of the Board available to
make such determination, in good faith by the Board whose determination shall be
described in a statement filed with the Rights Agent.
(e) Except as hereinafter provided, no adjustment in the
Purchase Price shall be required unless such adjustment would require an
increase or decrease of at least 1% in the Purchase Price; provided, however,
that any adjustments which by reason of this Section 11(e) are not required to
be made shall be carried forward and cumulated and taken into account in any
subsequent adjustment. All calculations under this Section 11 shall be made to
the nearest cent (other than calculations of the Current Market Price per Unit,
which shall be made to the nearest one-thousandth of a cent) or to the nearest
one-millionth of a Preferred Share or one-thousandth of a Class A Share, as the
case may be. Notwithstanding the first sentence of this Section 11(e), any
adjustment required by this Section 11 shall be made no later than the earlier
of (i) three
33
years from the date of the transaction which mandates such adjustment or (ii)
the Expiration Date.
(f) If, as a result of the operation of Section 11(a) or
Section 13(a) hereof, the holder of any Right thereafter exercised shall become
entitled to receive any shares of capital stock of the Company other than
Preferred Shares, thereafter the Purchase Price and the number of such other
shares so receivable upon exercise of any Right shall be subject to adjustment
from time to time in a manner and on terms as nearly equivalent as practicable
to the provisions with respect to the Preferred Shares contained in Sections
11(a), (b), (c), (d), (e), (g), (h), (i), (j), (k), (l) and (m), inclusive, and
the provisions of Sections 7, 9, 10, 13 and 14 hereof with respect to the
Preferred Shares shall apply on like terms to any such other shares; provided,
however, that the Company shall not be liable for its inability to reserve and
keep available for issuance upon exercise of the Rights pursuant to Section
11(a)(ii) a number of Preferred Shares greater than the number then authorized
by the Company's Amended Articles of Incorporation but not outstanding or
reserved for any other purpose.
(g) All Rights originally issued by the Company or transferred
subsequent to any adjustment made to the Purchase Price hereunder shall evidence
the right to purchase, at the adjusted Purchase Price, the number of Units
purchasable from time to time hereunder upon exercise of the Rights, all subject
to further adjustment as provided herein.
(h) Unless the Company shall have exercised its election as
provided in Section 11(i), upon each adjustment of the Purchase Price as a
result of the calculations made in Section 11(b) and Section 11(c), each Right
outstanding immediately prior to the making of such adjustment shall thereafter
evidence the right to purchase, at the adjusted Purchase Price, that number of
Units (calculated to the nearest one-millionth of a Preferred Share) obtained by
(i)
34
multiplying (A) the number of Units covered by a Right immediately prior to such
adjustment of the Purchase Price by (B) the Purchase Price in effect immediately
prior to such adjustment of the Purchase Price and (ii) dividing the product so
obtained by the Purchase Price in effect immediately after such adjustment of
the Purchase Price; provided, however, that if the Purchase Price is adjusted to
zero, then no adjustment shall be made pursuant to the foregoing part of this
Section 11(h) and each Right outstanding immediately prior to the making of such
adjustment shall evidence the right to acquire that number of Units or such
other securities or assets determined in good faith by the Board.
(i) The Company may elect on or after the date of any
adjustment of the Purchase Price to adjust the number of Rights, in substitution
for any adjustment in the number of Units purchasable upon the exercise of a
Right. Each of the Rights outstanding after such adjustment in the number of
Rights shall be exercisable for the number of Units for which a Right was
exercisable immediately prior to such adjustment. Each Right held of record
prior to such adjustment of the number of Rights shall become that number of
Rights (calculated to the nearest ten-thousandth of a Right) obtained by
dividing the Purchase Price in effect immediately prior to adjustment of the
Purchase Price by the Purchase Price in effect immediately after adjustment of
the Purchase Price. The Company shall make a public announcement of its election
to adjust the number of Rights, indicating the record date for the adjustment,
and, if known at the time, the amount of the adjustment to be made. This record
date may be the date on which the Purchase Price is adjusted or any day
thereafter, but, if the Right Certificates have been issued, shall be at least
ten days later than the date of the public announcement. If Right Certificates
have been issued, upon each adjustment of the number of Rights pursuant to this
Section 11(i), the Company shall, as promptly as practicable, cause to be
distributed to holders of
35
record of Right Certificates on such record date Right Certificates evidencing,
subject to Section 14 hereof, any additional Rights to which such holders shall
be entitled as a result of such adjustment, or at the option of the Company,
shall cause to be distributed to such holders of record in substitution and
replacement for the Right Certificates held by such holders prior to the date of
adjustment, and upon surrender thereof, if required by the Company, new Right
Certificates evidencing all the Rights to which such holders shall be entitled
after such adjustment. Right Certificates to be so distributed shall be issued,
executed and countersigned in the manner provided for herein (and may bear, at
the option of the Company, the adjusted Purchase Price) and shall be registered
in the names of the holders of record of Right Certificates on the record date
specified in the public announcement.
(j) Irrespective of any adjustment or change in the Purchase
Price or the number of Units issuable upon the exercise of the Rights, the Right
Certificates theretofore and thereafter issued may continue to express the
Purchase Price per Unit and the number of Units which were expressed in the
initial Right Certificates issued hereunder, but shall evidence the Purchase
Price or number of Units as adjusted or changed.
(k) Before taking any action that would cause an adjustment
reducing the Purchase Price below the then par value, if any, of one Unit, the
Company shall use its best efforts to take any corporate action which may, in
the opinion of its counsel, be necessary in order that the Company may validly
and legally issue fully paid and nonassessable Units at such adjusted Purchase
Price.
(l) In any case in which this Section 11 shall require that an
adjustment in the Purchase Price be made effective as of a record date for a
specified event, the Company may elect to defer until the occurrence of such
event the issuance to the holder of any Right exercised
36
after such record date of the number of Units and other capital stock or
securities of the Company, if any, issuable upon such exercise over and above
the number of Units and other capital stock or securities of the Company, if
any, issuable upon such exercise on the basis of the Purchase Price in effect
prior to such adjustment; provided, however, that the Company shall deliver to
such holder a due xxxx or other appropriate instrument evidencing such holder's
right to receive such additional shares (fractional or otherwise) or securities
upon the occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary
notwithstanding, in the event of (i) any reclassification of stock of the
Company, (ii) any recapitalization, reorganization or partial liquidation of the
Company, (iii) any consolidation or subdivision of the Preferred Shares, (iv)
any issuance of Preferred Shares (or securities which by their terms are
convertible into or exchangeable for Preferred Shares) wholly for cash at less
than the Current Market Price or (v) any stock dividends or issuance of rights,
options or warrants referred above in this Section 11 or any similar
transaction, the Company shall be entitled to make such further adjustments in
the Purchase Price, in addition to those adjustments expressly required by the
other paragraphs of this Section 11, as and to the extent that the Board in its
sole discretion shall determine to be necessary or appropriate in order for the
holders of the Rights in such event to be treated equitably and in accordance
with the purpose and intent of this Agreement or, subject to the preceding
provisions of this Section 11(m), in order that any such event shall not, in the
opinion of counsel for the Company, result in the shareholders of the Company
being subject to any United States federal income tax liability by reason
thereof.
(n) The Company covenants and agrees that it shall not, at any
time after the Distribution Date, (i) consolidate with any other Person (other
than a Subsidiary of the Company
37
in an action which complies with Section 11(o) hereof), (ii) merge with or into
any other Person (other than a Subsidiary of the Company in a transaction which
complies with Section 11(o) hereof) or (iii) sell or transfer (or permit any
Subsidiary to sell or transfer), in one transaction or a series of related
transactions, assets or earning power aggregating more than 50% of the assets or
earning power of the Company and its Subsidiaries (taken as a whole) to any
other Person or Persons (other than the Company or any of its Subsidiaries in
one or more transactions each of which complies with Section 11(o) hereof) if
(x) at the time of or immediately after such consolidation, merger or sale,
there are any rights, warrants or other instruments or securities outstanding or
agreements in effect which would substantially diminish or otherwise eliminate
the benefits intended to be afforded by the Rights or (y) prior to,
simultaneously with or immediately after such consolidation, merger or sale, the
shareholders of the Person who constitutes, or would constitute, the Principal
Party for purposes of Section 13(a) hereof shall have received a distribution of
Rights previously owned by such Person or any of its Affiliates and Associates.
(o) The Company covenants and agrees that, after the
Distribution Date, it will not, except as otherwise provided herein or permitted
by Section 23 or Section 26 hereof, take (or permit any Subsidiary to take) any
action if at the time such action is taken it is reasonably foreseeable that
such action will diminish substantially or otherwise eliminate the benefits
intended to be afforded by the Rights.
(p) Anything in this Agreement to the contrary
notwithstanding, in the event the Company shall at any time after the Record
Date and prior to the Distribution Date (i) declare a dividend or distribution
on any of its Common Shares payable in Common Shares of the Company or (ii)
subdivide or split any of its outstanding Common Shares into a greater number
38
of shares, (iii) combine or consolidate any of its outstanding Common Shares
into a smaller number of shares or effect a reverse split of any of its
outstanding Common Shares or (iv) issue any of its Common Shares by
reclassification or otherwise than by payment of dividends or distributions in
Common Shares, then in any such case, (x) the number of Units purchasable after
such event upon proper exercise of each Right shall be adjusted such that the
aggregate number of Units so purchasable by the holder of each Class A Share
and/or each Class B Share, as the case may be, immediately after such event
shall equal the number of Units purchasable by such holder immediately prior to
such event and (y) action shall be taken (if the Board determines that action is
required) such that the number of Rights associated with each Common Share of
the Company outstanding immediately or issued or delivered after such event
shall equal that number of Rights associated with each Common Share of the
Company outstanding immediately prior to such event. The adjustments provided
for in this Section 11(p) shall be made successively whenever such a dividend is
declared or paid or such a subdivision, combination or consolidation is
effected. If an event occurs which would require an adjustment under Section
11(a)(ii) and this Section 11(p), the adjustments provided for in this Section
11(p) shall be in addition and prior to any adjustment required pursuant to
Section 11(a)(ii).
Section 12. Certification of Certain Adjustments. Whenever an
adjustment is made as provided in Sections 11 and 13 hereof, the Company shall
(a) promptly prepare a certificate setting forth such adjustment and a brief
statement of the facts accounting for such adjustment, (b) promptly file with
the Rights Agent and with each transfer agent for its Common Shares and
Preferred Shares a copy of such certificate and (c) mail a brief summary thereof
to each holder of a Right Certificate (or, if prior to the Distribution Date, to
each holder of a certificate evidencing Common Shares) in accordance with
Section 25 hereof. Notwithstanding
39
the foregoing sentence, the failure of the Company to prepare such certificate
or statement or make such filings or mailings shall not affect the validity of,
the force or effect of, or the requirement for making any such adjustment.
Section 13. Consolidation, Merger or Sale or Transfer of
Assets or Earning Power.
(a) In the event (a "Section 13 Event") that, directly or
indirectly, at any time following the Stock Acquisition Date:
(x) the Company shall consolidate or otherwise combine with,
or merge with or into, any other Person or Persons (other than a
Subsidiary of the Company in a transaction which complies with Section
11(o) hereof) and the Company shall not be the continuing or surviving
corporation of such consolidation, combination or merger;
(y) any Person or Persons (other than a Subsidiary of the
Company in a transaction which complies with Section 11(o) hereof)
shall consolidate or otherwise combine with, or merge with or into, the
Company and the Company shall be the continuing or surviving
corporation of such consolidation, combination or merger and, in
connection therewith, all or part of the outstanding Class A Shares
shall be changed into or exchanged for stock or other securities of any
other Person or of the Company or cash or any other property; or
(z) the Company shall sell or otherwise transfer (or one or
more of its Subsidiaries shall sell or otherwise transfer), in one
transaction or a series of related transactions, assets or earning
power aggregating more than 50% of the assets or earning power of the
Company and its Subsidiaries (taken as a whole and calculated, with
respect to the assets reflected therein, on the basis of the Company's
most recent regularly
40
prepared financial statement) to any other Person or Persons (other
than the Company or any Subsidiary of the Company in one or more
transactions each of which complies with Section 11(o) hereof),
provided, however, that this clause (z) of Section 13(a) shall not
apply to the proportional distribution by the Company of assets
(including securities) of the Company or any of its Subsidiaries to all
holders of the Company's Common Shares on the basis set forth for such
distributions in the Amended Articles of Incorporation;
then, and in each such case (except as may be contemplated by Section 13(d)
hereof), proper provision shall be made so that:
(i) each holder of a Right (except as provided in Section 7(e)
hereof) shall, on or after the later of (A) the date of the first
occurrence of any such Section 13 Event or (B) the date of the
expiration of the period within which the Rights may be redeemed
pursuant to Section 23 hereof (as the same may be amended as provided
in Section 26 hereof), have the right to receive, upon the exercise
thereof at the then current Purchase Price in accordance with the terms
of this Agreement, such number of validly authorized and issued, fully
paid, nonassessable and freely tradable Common Shares of the Principal
Party, not subject to any liens, encumbrances, rights of call, rights
of first refusal or other adverse claims, as shall be equal to the
result obtained by (1) multiplying the then current Purchase Price by
the number of Units for which a Right was exercisable immediately prior
to the first occurrence of a Section 13 Event (or, if a Section
11(a)(ii) Event has occurred prior to the first occurrence of a Section
13 Event, multiplying the number of such Units for which a Right was
exercisable immediately prior to the first occurrence of a Section
11(a)(ii) Event by the Purchase Price in effect immediately prior to
the first occurrence of a Section 11(a)(ii) Event), and (2) dividing
that product (which, following
41
the first occurrence of a Section 13 Event, shall be referred to as the
"Purchase Price" for each Right (regardless of the number of Units
purchasable upon the exercise of a Right) and for all purposes of this
Agreement) by 50% of the Current Market Price per Common Share of such
Principal Party on the date of consummation of such Section 13 Event;
(ii) the Principal Party shall thereafter be liable for, and
shall assume, by virtue of such Section 13 Event, all the obligations
and duties of the Company pursuant to this Agreement;
(iii) the term "Company" shall thereafter be deemed to refer
to such Principal Party, it being specifically intended that the
provisions of Section 11 hereof shall apply only to such Principal
Party following the first occurrence of a Section 13 Event;
(iv) the Principal Party shall take such steps (including, but
not limited to, the reservation of a sufficient number of Common
Shares) in connection with the consummation of any such transaction as
may be necessary to assure that the provisions hereof shall thereafter
be applicable, as nearly as reasonably may be, in relation to the
Common Shares thereafter deliverable upon the exercise of the Rights;
and
(v) the provisions of Section 11(a)(ii) hereof shall be of no
effect following the first occurrence of any Section 13 Event;
provided, however, that, upon the subsequent occurrence of any merger,
consolidation, sale of all or substantially all assets, recapitalization,
reclassification of shares, reorganization or other extraordinary transaction
analogous to any of the events described in Section 11 hereof in respect of such
Principal Party, each holder of a Right shall thereupon be entitled to receive,
upon exercise of a Right and payment of the Purchase Price, such cash, shares,
rights, warrants or other property which such holder would have been entitled to
receive had such holder, at the
42
time of such transaction, owned the Common Shares of the Principal Party
purchasable upon the exercise of a Right, and such Principal Party shall take
such steps (including, but not limited to, reservation of its Common Shares) as
may be necessary (in a manner analogous to the applicable adjustments provided
for in Section 11 hereof) to permit the subsequent exercise of the Rights in
accordance with the terms hereof for such cash, shares, rights, warrants or
other property.
(b) "Principal Party" shall mean
(i) in the case of any transaction described in clause (x) or
clause (y) of the first sentence of Section 13(a) hereof, (A) the
Person that is the issuer of the securities into which Common Shares of
the Company are converted in such merger, consolidation or other
combination, or, if there is more than one such issuer, the issuer of
the Common Shares which have the greatest market value or (B) if no
securities are so issued, the Person that is the other party to the
merger, consolidation or other combination and survives said merger
(or, if there is more than one such Person, the Person the Common
Shares of which have the greatest market value) or, if the Person that
is the other party to the merger does not survive the merger, the
Person that does survive the merger (including the Company if it
survives); and
(ii) in the case of any transaction described in clause (z) of
the first sentence of Section 13(a) hereof, the Person that is the
party receiving the greatest portion of the assets or earning power
transferred pursuant to such transaction or transactions, or, if each
Person that is a party to such transaction or transactions receives the
same portion of the assets or earning power so transferred or if the
Person receiving the greatest portion of the assets or earning power
cannot be determined, whichever of such Persons as is the issuer of
Common Shares having the greatest market value;
43
provided, however, that in any such case, (1) if the Common Shares of such
Person are not at such time and have not been continuously over the preceding
12-month period registered under Section 12 of the Exchange Act, and such Person
is a direct or indirect Subsidiary of another Person the Common Shares of which
are and have been so registered, "Principal Party" shall refer to such other
Person; (2) if such Person is a Subsidiary, directly or indirectly, of more than
one Person, the Common Shares of two or more of which are and have been so
registered, "Principal Party" shall refer to whichever of such Persons is the
issuer of the Common Shares having the greatest aggregate market value; and (3)
if the Common Shares of such Person are not and have not been so registered and
such Person is owned, directly or indirectly, by a joint venture formed by two
or more Persons that are not owned, directly or indirectly, by the same Person,
the rules set forth in (1) and (2) above shall apply to each of the chains of
ownership having an interest in such joint venture as if such party were a
Subsidiary of both or all of such joint ventures and the Principal Parties in
each such chain shall bear the obligations set forth in this Section 13 in the
same ratio as their direct or indirect interests in such Person bear to the
total of such interests.
(c) The Company shall not consummate any Section 13 Event
unless prior thereto the Principal Party shall have a sufficient number of
authorized Common Shares which have not been issued or reserved for issuance to
permit the exercise in full of the Rights in accordance with this Section 13 and
unless prior thereto the Company and such Principal Party shall have executed
and delivered to the Rights Agent a supplemental agreement confirming that the
requirements of Sections 13(a) and (b) hereof shall promptly be performed in
accordance with their terms and that such Section 13 Event shall not result in a
default by the Principal Party under this Agreement as the same shall have been
assumed by the Principal Party pursuant to
44
Sections 13(a) and (b) hereof and further providing that, as soon as practicable
on or after the date of any Section 13 Event the Principal Party will:
(i) prepare and file a registration statement under the
Securities Act with respect to the Rights and the securities
purchasable upon exercise of the Rights on an appropriate form and will
use its best efforts (A) to cause such registration statement to (1)
become effective as soon as practicable after such filing and (2)
remain effective (with a prospectus at all times meeting the
requirements of the Securities Act) until the Expiration Date and (B)
to similarly comply with applicable state securities laws;
(ii) use its best efforts to list (or continue the listing of)
the Rights and the securities issuable upon exercise of the Rights on a
national securities exchange;
(iii) deliver to holders of the Rights historical financial
statements for the Principal Party and each of its Affiliates which
comply in all respects with the requirements for registration on Form
10 (or any successor form) under the Exchange Act; and
(iv) use its best efforts to obtain waivers of any rights of
first refusal or preemptive rights in respect of the Common Shares of
the Principal Party subject to purchase upon exercise of outstanding
Rights.
The provisions of this Section 13 shall similarly apply to successive mergers or
consolidations or sales or other transfers prior to the exercise of the Rights.
In the event that a Section 13 Event shall occur at any time after the
occurrence of a Section 11(a)(ii) Event, the Rights which have not theretofore
been exercised shall thereafter be exercisable in the manner described in
Section 13(a) hereof.
45
(d) Notwithstanding anything in this Agreement to the
contrary, this Section 13 shall not be applicable to a transaction described in
subparagraphs (x) and (y) of Section 13(a) hereof if (i) such transaction is
consummated with a Person or Persons (or a wholly-owned subsidiary of any such
Person or Persons) who acquired Class A Shares of the Company pursuant to a
tender offer or exchange offer for all outstanding Class A Shares which complies
with the exception provided for in Section 11(a)(ii) hereof, (ii) the price per
share for the Class A Shares offered in such transaction is not less than the
respective price per Class A Share paid to all holders of the Class A Shares
whose Class A Shares were purchased pursuant to such tender offer or exchange
offer and (iii) the form of consideration being offered to the remaining holders
of the Class A Shares pursuant to such transaction is the same as the form of
consideration paid pursuant to such tender offer or exchange offer. Upon
consummation of any such transaction contemplated by this Section 13(d), all
Rights hereunder shall expire.
Section 14. Fractional Rights and Fractional Shares.
(a) The Company may, but shall not be required to, issue
fractions of Rights (other than fractions which are integral multiples of
one-twentieth of a Right) or to distribute Right Certificates which evidence
fractional Rights (other than fractions which are integral multiples of
one-twentieth of a Right). If the Company shall determine not to issue such
fractional Rights, in lieu of such fractional Rights, there shall be paid to the
registered holders of the Rights with regard to which such fractional Rights
would otherwise be issuable an amount in cash equal to the same fraction of the
current market value of a whole Right. For the purposes of this Section 14(a),
the current market value of a whole Right shall be the closing price of the
Rights for the Trading Day immediately prior to the date on which such
fractional Rights would have been otherwise issuable. The closing price of the
Rights for any day shall be the last sale
46
price, regular way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on the New York Stock Exchange or,
if the Rights are not listed or admitted to trading on the New York Stock
Exchange, as reported in the principal consolidated transaction reporting system
with respect to securities listed on the principal national securities exchange
on which the Rights are listed or admitted to trading or, if the Rights are not
listed or admitted to trading on any national securities exchange, the last
quoted price or, if not so quoted, the average of the high bid and low asked
prices in the over-the-counter market, as reported by NASDAQ or such other
system then in use, or, if on any such date the Rights are not quoted by any
such organization, the average of the closing bid and asked prices as furnished
by a professional market maker making a market in the Rights. If on any such
date no such market maker is making a market in the Rights, the fair value of
the Rights on such date as determined in good faith by the Board shall be used.
(b) The Company may, but shall not be required to, issue
fractions of Preferred Shares (other than fractions which are integral multiples
of one-twentieth of a Unit) upon exercise of the Rights or to distribute
certificates which evidence fractional Preferred Shares (other than fractions
which are integral multiples of one-twentieth of a Unit). Interests in fractions
of Preferred Shares which are integral multiples of one-twentieth of a Unit may,
at the election of the Company, be evidenced by depositary receipts, pursuant to
an appropriate agreement between the Company and a depositary selected by it,
provided that such agreement shall provide that the holders of such depositary
receipts shall have all of the rights, privileges and preferences to which they
are entitled as beneficial owners of the Preferred Shares. In the event the
Company elects not to issue fractions of Preferred Shares that are not integral
multiples
47
of one-twentieth of a Unit, the Company shall pay to the registered holders of
Right Certificates at the time such Right Certificates are exercised as herein
provided an amount in cash equal to the same fraction of the current market
value of one Unit. For purposes of this Section 14(b), the current market value
of one Unit shall be the closing price of one Unit (as determined pursuant to
Section 11(d)(i) hereof) for the Trading Day immediately prior to the date of
such exercise.
(c) The holder of a Right by the acceptance of the Rights
expressly waives such holder's right to receive any fractional Rights or any
fractional shares upon exercise of a Right, except as permitted by this Section
14.
Section 15. Rights of Action. All rights of action in respect
of this Agreement, except the rights of action vested in the Rights Agent
pursuant to Section 18 hereof, are vested in the respective registered holders
of the Right Certificates (and, prior to the Distribution Date, the registered
holders of Common Shares of the Company); and any registered holder of any Right
Certificate (or, prior to the Distribution Date, of Common Shares of the
Company), without the consent of the Rights Agent or of the holder of any other
Right Certificate (or, prior to the Distribution Date, of Common Shares of the
Company), may, on such holder's own behalf and for such holder's own benefit,
enforce, and may institute and maintain any suit, action or proceeding against
the Company to enforce, or otherwise act in respect of, such holder's right to
exercise the Rights evidenced by such Right Certificate in the manner provided
in such Right Certificate and in this Agreement. Without limiting the foregoing
or any remedies available to the holders of Rights, it is specifically
acknowledged that the holders of Rights would not have an adequate remedy at law
for any breach of this Agreement and shall be entitled to specific performance
of the obligations hereunder and injunctive relief against actual or threatened
violations of the obligations hereunder of any Person subject to this Agreement.
48
Section 16. Agreement of Right Holders. Every holder of a
Right by accepting such Right, consents and agrees with the Company and the
Rights Agent and with every other holder of a Right that:
(a) prior to the Close of Business on the earlier of the
Distribution Date or the Expiration Date, the Rights shall be evidenced
by the certificates for Common Shares of the Company registered in the
name of the holders of such shares (which certificates for Common
Shares of the Company shall also constitute certificates for Rights)
and Rights will be transferable only in connection with the transfer of
Common Shares of the Company;
(b) after the Close of Business on the Distribution Date, the
Right Certificates will be transferable only on the registry books of
the Rights Agent if surrendered at the principal office or offices of
the Rights Agent designated for such purposes, duly endorsed or
accompanied by a proper instrument of transfer and with the appropriate
forms and certificates duly executed and accompanied by any tax or
governmental charge imposed in accordance with Section 6(a) hereof;
(c) subject to Section 6(a) and Section 7(f) hereof, the
Company and the Rights Agent may deem and treat the Person in whose
name the Right Certificate (or, prior to the Distribution Date, the
associated Common Share certificate) is registered as the absolute
owner thereof and of the Rights evidenced thereby (notwithstanding any
notations of ownership or writing on the Right Certificate or the
associated Common Share certificate made by anyone other than the
Company, the Rights Agent or the transfer agent for the Common Shares)
for all purposes whatsoever, and neither the
49
Company nor the Rights Agent, subject to the last sentence in Section
7(e) hereof, shall be affected by any notice to the contrary; and
(d) notwithstanding anything in this Agreement to the contrary
neither the Company nor the Rights Agent shall have any liability to
any holder of a Right or other Person as a result of its inability to
perform any of its obligations under this Agreement by reason of any
preliminary or permanent injunction or other order, decree or ruling
issued by a court of competent jurisdiction or by a governmental,
regulatory or administrative agency or commission, or any statute,
rule, regulation or executive order promulgated or enacted by any
governmental authority, prohibiting or otherwise restraining
performance of such obligation; provided, however, the Company must use
its best efforts to have any such order, decree or ruling lifted or
otherwise overturned as soon as possible.
Section 17. Right Certificate Holder Not Deemed a Shareholder.
No holder of any Right or Right Certificate, as such, shall be entitled to vote,
receive dividends or other distributions or be deemed for any purpose the holder
of the number of Units or any other securities of the Company which may at any
time be issuable on the exercise of the Rights evidenced thereby, nor shall
anything contained herein or in any Right Certificate be construed to confer
upon the holder of any Right Certificate, as such, any of the rights of a
shareholder of the Company or any right to vote for the election of directors or
upon any matter submitted to shareholders at any meeting thereof, or to give or
withhold consent to any corporate action, or to receive notice of meetings or
other actions affecting shareholders (except as provided in Section 24 hereof),
or to receive dividends, distributions or subscription rights, or to exercise
preemptive rights or otherwise, until the Right or Rights evidenced by such
Right Certificate shall have been
50
exercised in accordance with the provisions hereof and the Units or other
securities shall have been issued in respect thereof.
Section 18. Concerning the Rights Agent.
(a) The Company agrees to pay to the Rights Agent reasonable
compensation for all services rendered by it hereunder and, from time to time,
on demand of the Rights Agent, its reasonable expenses and counsel fees and
disbursements and other disbursements incurred in the administration and
execution of this Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Rights Agent for, and to
hold it harmless against, any loss, liability or expense incurred without
negligence, bad faith or willful misconduct on the part of the Rights Agent for
anything done or omitted by the Rights Agent in connection with the acceptance
and administration of this Agreement, including the costs and expenses of
defending against any claim of liability in the premises.
(b) The Rights Agent shall be protected and shall incur no
liability for or in respect of any action taken, suffered or omitted by it in
connection with its administration of this Agreement in reliance upon any Right
Certificate or certificate for Preferred Shares or for other securities of the
Company or any other Person, instrument of assignment or transfer, power of
attorney, endorsement, affidavit, letter, notice, direction, consent,
certificate, statement or other paper or document believed by it to be genuine
and to be signed, executed and, where necessary, verified or acknowledged by the
proper Person or Persons.
So long as the Rights are listed on the New York Stock
Exchange, the Rights Agent, if its principal offices are located outside New
York City, shall maintain in the New York City area facilities for the servicing
of the Rights in the area of Manhattan located south of Xxxxxxxx Street. Such
facilities may consist of either an office or agency where transactions in
51
the Rights are serviced directly or a "drop" where Common Share certificates,
Right Certificates and other instruments relating to transactions in Rights may
be received for redelivery to an office or agency outside New York City, all in
accordance with the provisions of Section 6 of the Listed Company Manual of the
New York Stock Exchange.
Section 19. Merger or Consolidation or Change of Name of
Rights Agent.
(a) Any corporation into which the Rights Agent or any
successor Rights Agent may be merged or with which it may be consolidated, or
any corporation resulting from any merger or consolidation to which the Rights
Agent or any successor Rights Agent shall be a party, or any corporation
succeeding to the corporate trust or stock transfer business of the Rights Agent
or any successor Rights Agent, shall be the successor to the Rights Agent under
this Agreement without the execution or filing of any paper or any further act
on the part of any of the parties hereto; provided, however, that such
corporation would be eligible for appointment as a successor Rights Agent under
the provisions of Section 21 hereof. The purchase of all or substantially all of
the Rights Agent's assets employed in the performance of transfer agent
activities shall be deemed a merger or consolidation for purposes of this
Section 19. In case at the time such successor Rights Agent shall succeed to the
agency created by this Agreement, any of the Right Certificates shall have been
countersigned but not delivered, any such successor Rights Agent may adopt the
countersignature of any predecessor Rights Agent and deliver such Right
Certificates so countersigned; and in case at that time any of the Right
Certificates shall not have been countersigned, any successor Rights Agent may
countersign such Right Certificates either in the name of the predecessor Rights
Agent or in the name of the successor Rights Agent; and in all such cases such
Right Certificates shall have the full force provided in the Right Certificates
and in this Agreement.
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(b) In case at any time the name of the Rights Agent shall be
changed and at such time any of the Right Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the countersignature
under its prior name and deliver Right Certificates so countersigned; and in
case at that time any of the Right Certificates shall not have been
countersigned, the Rights Agent may countersign such Right Certificates either
in its prior name or in its changed name; and in all such cases such Right
Certificates shall have the full force provided in the Right Certificates and in
this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent
undertakes the duties and obligations imposed by this Agreement upon the
following terms and conditions, by all of which the Company and the holders of
Right Certificates, by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel (which may
be legal counsel for the Company), and the opinion of such counsel shall be full
and complete authorization and protection to the Rights Agent as to any action
taken or omitted by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this
Agreement the Rights Agent shall deem it necessary or desirable that any fact or
matter (including without limitation the identity of any Acquiring Person and
the determination of any Current Market Price) be proved or established by the
Company prior to taking or suffering any action hereunder, such fact or matter
(unless other evidence in respect thereof be herein specifically prescribed) may
be deemed to be conclusively proved and established by a certificate signed by
the Chairman of the Board, the Vice Chairman of the Board, the President or any
Vice President and by the Secretary or any Assistant Secretary of the Company or
the Treasurer or any Assistant
53
Treasurer and delivered to the Rights Agent; and such certificate shall be full
authorization to the Rights Agent for any action taken or suffered in good faith
by it under the provisions of this Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only for its
own negligence, bad faith or willful misconduct and the negligence, bad faith or
willful misconduct of its employees, affiliates, representatives and agents.
(d) The Rights Agent shall not be liable for or by reason of
any of the statements of fact or recitals contained in this Agreement or in the
Right Certificates or be required to verify the same (except as to its
countersignature on the Right Certificates), but all such statements and
recitals are and shall be deemed to have been made by the Company only.
(e) The Rights Agent shall not be under any responsibility in
respect of the validity of this Agreement or the execution and delivery hereof
(except the due execution hereof by the Rights Agent) or in respect of the
validity or execution of any Right Certificate (except its countersignature
thereof); nor shall it be responsible for any breach by the Company of any
covenant or condition contained in this Agreement or in any Right Certificate;
nor shall it be responsible for any adjustment required under the provisions of
Section 11 or Section 13 or responsible for the manner, method or amount of any
such adjustment or the ascertaining of the existence of facts that would require
any such adjustment (except with respect to the exercise of Rights evidenced by
Right Certificates after actual notice of any such adjustment); nor shall it by
any act hereunder be deemed to make any representation or warranty as to the
authorization or reservation of any Preferred Shares, Common Shares of the
Company or other securities to be issued pursuant to this Agreement or any Right
Certificate or as to whether any Preferred Shares,
54
Common Shares of the Company or other securities will, when so issued, be
validly authorized and issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed, acknowledged and
delivered all such further and other acts, instruments and assurances as may
reasonably be required by the Rights Agent for the carrying out or performing by
the Rights Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to
accept instructions with respect to the performance of its duties hereunder from
the President, the Chief Financial Officer and the Treasurer of the Company, and
to apply to such officers for advice or instructions in connection with its
duties, and it shall not be liable for any action taken or suffered to be taken
by it in good faith in accordance with instructions of any such officer.
(h) The Rights Agent and any shareholder, director, officer or
employee of the Rights Agent may buy, sell or deal in any of the Rights or other
securities of the Company or become pecuniarily interested in any transaction in
which the Company may be interested, or contract with or lend money to the
Company or otherwise act as fully and freely as though it were not the Rights
Agent under this Agreement. Nothing herein shall preclude the Rights Agent from
acting in any other capacity for the Company or for any other Person.
(i) The Rights Agent may execute and exercise any of the
rights or powers hereby vested in it or perform any duty hereunder either itself
or by or through its attorneys or agents, and the Rights Agent shall not be
answerable or accountable for any act, default, neglect or misconduct of any
such attorneys or agents or for any loss to the Company resulting from any such
act, default, neglect or misconduct, provided reasonable care was exercised in
the selection and continued employment thereof.
55
Section 21. Change of Rights Agent. The Rights Agent or any
successor Rights Agent may resign and be discharged from its duties under this
Agreement upon thirty (30) days' prior notice in writing mailed to the Company
and to each transfer agent of the Common Shares of the Company and the Preferred
Shares by registered or certified mail, and to the holders of the Right
Certificates by first-class mail. The Company may remove the Rights Agent or any
successor Rights Agent upon thirty (30) days' prior notice in writing, mailed to
the Rights Agent or successor Rights Agent, as the case may be, and to each
transfer agent of the Common Shares of the Company and the Preferred Shares by
registered or certified mail, and to the holders of the Right Certificates by
first-class mail. If the Rights Agent shall resign or be removed or shall
otherwise become incapable of acting, the Company shall appoint a successor to
the Rights Agent. If the Company shall fail to make such appointment within a
period of thirty (30) days after giving notice of such removal or after it has
been notified in writing of such resignation or incapacity by the resigning or
incapacitated Rights Agent or by the holder of a Right Certificate (who shall,
with such notice, submit such holder's Right Certificate for inspection by the
Company), then the registered holder of any Right Certificate may apply to any
court of competent jurisdiction for the appointment of a new Rights Agent. Any
successor Rights Agent, whether appointed by the Company or by such a court,
shall be (a) a corporation organized and doing business under the laws of the
United States or of the State of Ohio (or of any other state of the United
States so long as such corporation is authorized to do business as a banking
institution in the State of Ohio), in good standing, having its principal office
in the State of Ohio, which is authorized under such laws to exercise corporate
trust or stock transfer powers and is subject to supervision or examination by
federal or state authority and which has at the time of its appointment as
Rights Agent a combined capital and surplus of at least $100,000,000
56
or (b) an Affiliate of a corporation described in clause (a) above. After
appointment, the successor Rights Agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally named as Rights
Agent without further act or deed; but the predecessor Rights Agent shall
deliver and transfer to the successor Rights Agent any property at the time held
by it here under and execute and deliver any further assurance, conveyance, act
or deed necessary for the purpose. Not later than the effective date of any such
appointment, the Company shall file notice thereof in writing with the
predecessor Rights Agent and each transfer agent of its Common Shares and the
Preferred Shares, and mail a notice thereof to the registered holders of the
Right Certificates. Failure to give any notice provided for in this Section 21,
however, or any defect therein, shall not affect the legality or validity of the
resignation or removal of the Rights Agent or the appointment of the successor
Rights Agent, as the case may be.
Section 22. Issuance of New Right Certificates.
Notwithstanding any of the provisions of this Agreement or of the Rights to the
contrary, the Company may, at its option, issue new Right Certificates
evidencing Rights in such form as may be approved by its Board to reflect any
adjustment or change in the Purchase Price and the number or kind or class of
shares of stock or other securities or property purchasable under the Right
Certificates made in accordance with the provisions of this Agreement. In
addition, in connection with the issuance or sale of Common Shares following the
Distribution Date (other than upon exercise of a Right) and prior to the
redemption of the Rights or the Expiration Date, the Company (a) shall, with
respect to Common Shares so issued or sold pursuant to the exercise of stock
options or under any employee plan or arrangement, granted or awarded as of the
Distribution Date, or upon the exercise, conversion or exchange of securities,
notes or debentures issued by the Company as of
57
the Distribution Date, and (b) may, in any other case, if deemed necessary or
appropriate by the Board, issue Right Certificates evidencing the appropriate
number of Rights in connection with such issuance or sale; provided, however,
that (i) no such Right Certificate shall be issued if and to the extent that the
Company shall be advised by counsel that such issuance would create a
significant risk of material adverse tax consequences to the Company or the
Person to whom such Right Certificate would be issued and (ii) no such Right
Certificate shall be issued if and to the extent that appropriate adjustment
shall otherwise have been made in lieu of the issuance thereof.
Section 23. Redemption.
(a) The Board may, at its option, at any time prior to the
earlier of (x) the Close of Business on the tenth Business Day following the day
on which the Stock Acquisition Date occurs (or, if the Stock Acquisition Date
shall have occurred prior to the Record Date, the Close of Business on the tenth
Business Day following the day on which the Record Date occurs) or (y) the Close
of Business on the Final Expiration Date, redeem all but not less than all of
the then outstanding Rights at a redemption price of $0.01 per Right (payable in
cash, Class A Shares (based on the Current Market Price of the Class A Shares at
the time of redemption) or any other form of consideration deemed appropriate by
the Board), as such amount may be appropriately adjusted to reflect any stock
split, stock dividend or similar transaction occurring after the date hereof
(such redemption price being hereinafter referred to as the "Redemption Price").
Notwithstanding anything contained in this Agreement to the contrary, the Rights
shall not be exercisable after the first occurrence of a Section 11(a)(ii) Event
until such time as the Company's right of redemption hereunder has expired.
58
(b) Immediately upon the action of the Board ordering the
redemption of the Rights, without any further action and without any notice, the
right to exercise the Rights will terminate and the only right thereafter of the
holders of Rights shall be to receive the Redemption Price for each Right so
held. As soon as practicable after the action of the Board ordering the
redemption of the Rights, the Company shall give notice of such redemption to
the Rights Agent and the holders of the then outstanding Rights by mailing such
notice to each such holder at its last address as it appears upon the registry
books of the Rights Agent or, prior to the Distribution Date, on the registry
books of the transfer agent for the Common Shares of the Company. Any notice
which is mailed in the manner herein provided shall be deemed given, whether or
not the holder receives the notice. Each such notice of redemption will state
the method by which the payment of the Redemption Price will be made.
Section 24. Notice of Certain Events. In case the Company
shall propose, at any time after the Distribution Date:
(a) to pay any dividend payable in stock of any class to the
holders of its Preferred Shares or to make any other distribution to the holders
of its Preferred Shares (other than a regular periodic dividend out of earnings
or retained earnings of the Company);
(b) to offer to the holders of Preferred Shares options,
rights or warrants to subscribe for or to purchase any additional Preferred
Shares or shares of stock of any class or any other securities, rights or
options;
(c) to effect any reclassification of the Preferred Shares
(other than a reclassification including only the subdivision of outstanding
Preferred Shares) or any recapitalization or reorganization of the Company;
59
(d) to effect any of the transactions referred to in Section
11(a)(ii) or Section 13 of this Agreement; or
(e) to effect the liquidation, dissolution or winding up of
the Company, then, in each such case, the Company shall give to each holder of a
Right, to the extent feasible and in accordance with Section 25 hereof, a notice
of such proposed action, which shall specify the date on which such dividend,
distribution, offer, reclassification, recapitalization, reorganization, Section
11(a)(ii) or Section 13 transaction, liquidation, dissolution or winding up is
to take place and the date of participation therein by the holders of Preferred
Shares, if any such date is to be fixed, and, in the case of a transaction
referred to in clause (d) above, the consequences of the event to the holders of
the Rights under Section 11(a)(ii) and Section 13 hereof, as the case may be. In
case of the occurrence of a Section 11(a)(ii) Event or a Section 13 Event, or if
the Rights otherwise become exercisable for Common Shares or other securities,
all references in this Section 24 to Preferred Shares shall be deemed thereafter
to refer also to Common Shares or other securities issuable in respect of the
Rights. Such notice shall be so given at least twenty (20) days prior to the
date of the taking of such proposed action or the date of participation therein
by the holders of Common Shares or Preferred Shares, whichever shall be the
earlier. Upon the consummation of such transaction, the Company (or its
successor or assign) shall similarly give notice thereof to each holder of the
Rights, to the extent feasible. The failure to give notice required by this
Section 24 or any defect therein shall not affect the legality or validity of
the action taken by the Company or the vote upon any such action.
Section 25. Notices. Notices or demands authorized by this
Agreement to be given or made by the Rights Agent or by the holder of any Right
Certificate to or on the
60
Company shall be sufficiently given or made if sent by first-class mail, postage
prepaid, addressed (until another address is filed in writing with the Rights
Agent) as follows:
The Xxxxxxxx and Xxxxxxxx Company
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxx, Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
Subject to the provisions of Section 21 hereof, any notice or demand authorized
by this Agreement to be given or made by the Company or by the holder of any
Right Certificate to or on the Rights Agent shall be sufficiently given or made
if sent by first-class mail, postage prepaid, addressed (until another address
is filed in writing with the Company) as follows:
Xxxxx Fargo Bank Minnesota, N.A.
000 Xxxxx Xxxxxxx Xxxxxxxx
Xxxxx Xx. Xxxx, Xxxxxxxxx 00000-0000
Attention: Xxxxxxx Xxxxx
Vice President, Account Manager
and Shareowner Services
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Right Certificate (or, if prior
to the Distribution Date, to each holder of a certificate representing Common
Shares of the Company) shall be sufficiently given or made if sent by
first-class mail, postage prepaid, addressed to such holder at the address of
such holder as shown on the registry books of the Company.
Section 26. Supplements and Amendments. Prior to the
Distribution Date and subject to the penultimate sentence of this Section 26,
the Company and the Rights Agent shall, if the Company so directs, supplement or
amend any provision of this Agreement in any respect whatsoever (including,
without limitation, any extension of the period in which the Rights may be
redeemed) without the approval of any holders of certificates representing
Common Shares of
61
the Company. From and after the Distribution Date and subject to the penultimate
sentence of this Section 26, the Company and the Rights Agent shall, if the
Company so directs, supplement or amend this Agreement without the approval of
any holders of certificates representing Common Shares of the Company or of
Right Certificates in order (i) to cure any ambiguity, (ii) to correct or
supplement any provision contained herein which may be defective or inconsistent
with any other provisions herein, (iii) to shorten or lengthen any time period
hereunder or (iv) to change or supplement or make any other provisions in any
manner which the Company may deem necessary or desirable and which shall not
adversely affect the interests of the holders of Right Certificates (other than
an Acquiring Person or an Affiliate or Associate thereof); provided, however,
that this Agreement may not be supplemented or amended to lengthen, pursuant to
clause (iii) of this sentence, (A) whether before or after the Distribution Date
a time period relating to when the Rights may be redeemed or to modify the
ability (or inability) of the Board to redeem the Rights, in either case at such
time as the Rights are not then redeemable or (B) after the Distribution Date,
any other time period unless such lengthening is for the purpose of protecting,
enhancing or clarifying the rights of, or the benefits to, the holders of Rights
(other than an Acquiring Person or an Affiliate or Associate thereof). Upon the
delivery of a certificate from an appropriate officer of the Company which
states that the proposed supplement or amendment is in compliance with the terms
of this Section 26, the Rights Agent shall execute such supplement or amendment.
Notwithstanding anything contained in this Agreement to the contrary, no
supplement or amendment shall be made which changes the Redemption Price or the
number of Units for which a Right is exercisable. Prior to the Distribution
Date, the interests of the holders of Rights shall be deemed coincident with the
interests of the holders of Common Shares.
62
Section 27. Successors. All the covenants and provisions of
this Agreement by or for the benefit of the Company or the Rights Agent shall
bind and inure to the benefit of their respective successors and assigns
hereunder.
Section 28. Determinations and Actions Taken by the Board of
Directors. For all purposes of this Agreement, any calculation of the number of
Common Shares outstanding at any particular time, including for purposes of
determining the particular percentage of outstanding Class A Shares of which any
Person is the Beneficial Owner, shall be made in accordance with the last
sentence of Rule 13d-3(d)(1)(i) of the General Rules and Regulations under the
Exchange Act. The Board shall have the exclusive power and authority to
administer this Agreement and to exercise all rights and powers specifically
granted to such Board, or as may be necessary or advisable in the administration
of this Agreement, including, without limitation, the right and power to (i)
interpret the provisions of this Agreement and (ii) make all determinations
deemed necessary or advisable for the administration of this Agreement
(including a determination to redeem or not redeem the Rights or to amend the
Agreement). All such actions, calculations, interpretations and determinations
(including, for purposes of clause (y) below, all omissions with respect to the
foregoing) which are done or made by the Board or the Company in good faith,
shall (x) be final, conclusive and binding on the Company, the Rights Agent, the
holders of the Right Certificates and all other parties and (y) not subject the
Board to any liability to the holders of the Rights and Right Certificates.
Section 29. Benefits of this Agreement. Nothing in this
Agreement shall be construed to give to any Person other than the Company, the
Rights Agent and the registered holders of the Right Certificates (and, prior to
the Distribution Date, the registered holders of Common Shares of the Company)
any legal or equitable right, remedy or claim under this
63
Agreement; but this Agreement shall be for the sole and exclusive benefit of the
Company, the Rights Agent and the registered holders of the Right Certificates
(and, prior to the Distribution Date, registered holders of Common Shares of the
Company).
Section 30. Governing Law. This Agreement and each Right and
Right Certificate issued hereunder shall be deemed to be a contract made under
the laws of the State of Ohio and for all purposes shall be governed by and
construed in accordance with the laws of such State applicable to contracts to
be made and performed entirely within such State, except that the rights and
obligations of the Rights Agent under this Agreement shall be governed by and
construed in accordance with the laws of the State of Minnesota.
Section 31. Counterparts. This Agreement may be executed in
any number of counterparts and each of such counterparts shall for all purposes
be deemed to be an original, and all such counterparts shall together constitute
but one and the same instrument.
Section 32. Descriptive Headings. Descriptive headings of the
several Sections of this Agreement are inserted for convenience only and shall
not control or affect the meaning or construction of any of the provisions
hereof.
Section 33. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction or
other authority to be invalid, void or unenforceable, (a) such invalid, void or
unenforceable term, provision, covenant or restriction shall nevertheless be
valid, legal and enforceable to the extent, if any, provided by such court or
authority and (b) the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and shall
in no way be affected, impaired or invalidated; provided, however, that
notwithstanding anything in this Agreement to the contrary, if any such term,
provision, covenant or restriction is held by such court or authority to be
64
invalid, void or unenforceable and the Board determines in its good faith
judgment that severing the invalid language from this Agreement would adversely
affect the purpose or effect of this Agreement, the right of redemption set
forth in Section 23 hereof shall be reinstated and shall not expire until the
Close of Business on the tenth Business Day following the date of such
determination by the Board.
Section 34. Exchange.
(a) (i) The Company may, at its option, at any time after any
Person becomes an Acquiring Person, upon resolution adopted by the Board,
exchange all or part of the then outstanding and exercisable Rights (which shall
not include Rights that have become void pursuant Section 7(e)) for Units at an
exchange ratio of one Unit per Right, appropriately adjusted to reflect any
stock split, stock dividend or similar transaction occurring after the Record
Date (such exchange ratio being hereinafter referred to as the "Section 34(a)(i)
Exchange Ratio"). Notwithstanding the foregoing, the Company may not effect such
exchange at any time after any Person (other than an Exempt Person), together
with all Affiliates and Associates of such Person, becomes the Beneficial Owner
of 50% or more of the shares of Class A Shares then outstanding.
(ii) The Company may, at its option, at any time after any
Person becomes an Acquiring Person, upon resolution adopted by the Board,
exchange all or part of the then outstanding and exercisable Rights (which shall
not include Rights that have become void pursuant to Section 7(e)) for Units at
an exchange ratio specified in the following sentence, as appropriately adjusted
to reflect any stock split, stock dividend or similar transaction occurring
after the Record Date. Subject to such adjustment, each Right may be exchanged
for that number of Units obtained by dividing the Adjustment Spread (as defined
below) by the then
65
Current Market Price per Unit on the earlier of (i) the date on which any Person
becomes an Acquiring Person and (ii) the date on which a tender or exchange
offer by any Person (other than an Exempt Person) is first published or sent or
given within the meaning of Rule 14d-4(a) of the General Rules and Regulations
under the Exchange Act, or any successor rule, if upon consummation thereof such
Person would be the Beneficial Owner of a Substantial Block (such exchange ratio
being the "Section 34(a)(ii) Exchange Ratio"). The "Adjustment Spread" shall
equal (x) the aggregate market price on the date of such event of the number of
Adjustment Units minus (y) the Purchase Price. Notwithstanding the foregoing,
the Company may not effect such exchange at any time after any Person (other
than an Exempt Person), together with all Affiliates and Associates of such
Person, becomes the Beneficial Owner of 50% or more of the Class A Shares then
outstanding.
(b) Immediately upon the action of the Board ordering the
exchange of any Rights pursuant to Section 34(a), and without any further action
and without any notice, the right to exercise such Rights shall terminate and
the only right thereafter of a holder of such Rights shall be to receive that
number of Units equal to the number of such Rights held by such holder
multiplied by the Section 34(a)(i) Exchange Ratio or Section 34(a)(ii) Exchange
Ratio, as the case may be. The Company shall promptly give public notice of any
such exchange; provided, however, that the failure to give, or any defect in,
such notice shall not affect the validity of such exchange. The Company promptly
shall mail a notice of any such exchange to all of the holders of such Rights at
their last addresses as they appear upon the registry books of the Rights Agent.
Any notice that is mailed in the manner herein provided shall be deemed given,
whether or not the holder receives the notice. Each such notice of exchange
shall state the method by which the exchange of Units for Rights will be
effected and, in the event of any partial exchange, the
66
number of Rights that will be exchanged. Any partial exchange shall be effected
pro rata based on the number of Rights (other than Rights that have become void
pursuant to Section 7(e)) held by each holder of Rights.
(c) In the event that the number of Preferred Shares that are
authorized by the Company's Amended Articles of Incorporation but not
outstanding or reserved for issuance for purposes other than upon exercise of
the Rights are not sufficient to permit any exchange of Rights as contemplated
in accordance with this Section 34, the Company shall take all such action as
may be necessary to authorize additional Preferred Shares for issuance upon
exchange of the Rights or make adequate provision to substitute (1) cash, (2)
Common Shares or other equity securities of the Company, (3) debt securities of
the Company, (4) other assets or (5) any combination of the foregoing, having an
aggregate value equal to the Adjustment Spread, where such aggregate value has
been determined by the Board.
(d) The Company may, but shall not be required to, issue
fractions of Units (other than fractions which are integral multiples of
one-twentieth of a Right) or to distribute certificates that evidence fractional
Units. In lieu of fractional Units (other than fractions which are integral
multiples of one-twentieth of a Right), the Company may pay to the registered
holders of Right Certificates at the time such Rights are exchanged as herein
provided an amount in cash equal to the same fraction of the current market
value of one Unit. For purposes of this Section 34(d), the current market value
of one Unit shall be the closing price of one Unit (as determined pursuant to
Section 11(d)(i) hereof) for the Trading Day immediately prior to the date of
such exercise.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed all as of the day and year first above written.
Attest: THE XXXXXXXX AND XXXXXXXX COMPANY
By: /s/ By: /s/ Xxxxx X. Xxxxxxxxxx
--------------------------------- -------------------------------
Title: Secretary Title: President and Chief
Executive Officer
Attest: XXXXX FARGO BANK MINNESOTA, N.A.
By: /s/ By: /s/ Xxxxxxx X. Xxxxx
--------------------------------- -------------------------------
Title: Assistant Secretary Title: Vice President
Exhibit A
FORM OF
CERTIFICATE OF AMENDMENT BY DIRECTORS TO
AMENDED ARTICLES OF INCORPORATION
OF
THE XXXXXXXX AND XXXXXXXX COMPANY
Ohio Charter Number: 007639
Pursuant to Section 1701.73 of the Ohio Revised Code
Xxxxx X. Xxxxxx, who is the Chairman of the Board of The
Xxxxxxxx and Xxxxxxxx Company, an Ohio corporation for profit (the
"Corporation"), does hereby certify that the following is a true and complete
copy of the resolution adopting an amendment to the Amended Articles of
Incorporation of the Corporation (the "Amended Articles of Incorporation") duly
adopted by the Board of Directors of the Corporation at its meeting held on the
18th day of April, 2001 pursuant to the authority vested in the Board of
Directors of the Corporation in accordance with the provisions of Section
1701.70(B)(1) of the Ohio Revised Code and Section 2.a. of Article FOURTH of the
Amended Articles of Incorporation:
RESOLVED, that Article FOURTH of the Amended Articles of
Incorporation of the Corporation be, and it hereby is, amended to add a
new Section 5 providing for a new series of preferred shares of the
Corporation and that the form of such amendment and the express terms
and provisions of the new series of preferred shares are as follows:
Section 5. Terms and Provisions of Series B Participating
Preferred Shares.
a. Designation and Amount. There shall be established a series
of Preferred Shares which shall be designated as the "Series B Participating
Preferred Shares" and the number of shares constituting such series shall be
2,000,000.
b. Dividends and Distributions.
(1) Subject to the provisions for adjustment set forth in this
Section 5.b. of this Article FOURTH, the holders of Series B Participating
Preferred Shares shall be entitled to receive, when and if declared by the Board
of Directors out of funds legally available for the purpose, dividends on each
Series B Participating Preferred Share equal to 1,000 (as adjusted from time to
time as provided in subparagraph (2) of this Section 5.b. of this Article
FOURTH, the "Class A Multiple") times the aggregate amount of dividends or
distributions declared
(whether or not paid) from time to time per Class A Common Share (other than to
the extent that such dividends and distributions are payable in Class A Common
Shares); provided that, in the event the dividends and distributions declared on
each Series B Participating Preferred Share outstanding during the period (a
"Dividend Period") between any Dividend Payment Date (as defined below) and the
next subsequent Dividend Payment Date (or, in the case of the first Dividend
Period, the period between the date of issuance of the first Series B
Participating Preferred Share or any fraction thereof and the next subsequent
Dividend Payment Date), do not in the aggregate equal at least $10 per Series B
Participating Preferred Share, then each Series B Participating Preferred Share
shall be entitled to receive, when and if declared by the Board of Directors out
of funds legally available for the purpose, dividends ("Minimum Dividends") on
each Series B Participating Preferred Share equal to the difference between $10
and the amount of any dividends or distributions declared on the Series B
Participating Preferred Shares during such Dividend Period. Minimum Dividends
shall be payable in cash on the Dividend Payment Date ending the applicable
Dividend Period. "Dividend Payment Dates" shall mean the dates determined by the
Board of Directors, which dates shall be no later than the last day of January,
April, June and September in each year.
(2) In the event the corporation shall at any time or from
time to time after May 6, 2001 (the "Rights Declaration Date") (a) declare any
dividend or distribution on the Class A Common Shares payable in Class A Common
Shares, (b) subdivide the outstanding Class A Common Shares, or (c) combine the
outstanding Class A Common Shares into a smaller number of shares, then in each
such case the Class A Multiple shall be adjusted by multiplying such amount by a
fraction the numerator of which is the number of Class A Common Shares
outstanding immediately after such event and the denominator of which is the
number of Class A Common Shares outstanding immediately prior to such event.
(3) The corporation shall declare a dividend or distribution
on the Series B Participating Preferred Shares as set forth in subparagraph (1)
of this Section 5.b. of this Article FOURTH prior to or simultaneously with a
declaration of any dividend or distribution on the Class A Common Shares (other
than a dividend or distribution payable in Class A Common Shares) or, in the
case of dividends payable on a Dividend Payment Date, prior to such Dividend
Payment Date.
(4) Dividends shall begin to accrue and be cumulative on each
outstanding Series B Participating Preferred Share from the date of issuance
thereof. Accrued and accumulated but unpaid dividends shall not bear interest.
Dividends paid on the Series B Participating Preferred Shares in an amount less
than the total amount of such dividends at the time accrued, accumulated and
payable on such shares shall be allocated pro rata on a share-by-share basis
among all such shares at the time outstanding. The Board of Directors may fix a
record date for the determination of holders of Series B Participating Preferred
Shares entitled to receive payment of a dividend or distribution declared
thereon, which record date shall be no more than 60 days prior to the date fixed
for the payment thereof.
c. Voting Rights. Subject to the Ohio Code and any amendments
to these Amended Articles of Incorporation by the Board of Directors providing
for the issuance of any series of Preferred Shares (other than the Series B
Participating Preferred Shares), the holders of the Class A Common Shares, Class
B Common Shares and Preferred Shares of all series
2
(including, without limitation, the Series B Participating Preferred Shares)
shall be entitled to one vote per share and shall vote together as a single
class for all corporate purposes.
d. Liquidation, Dissolution or Winding Up. In the event of any
liquidation, dissolution or winding up of the corporation, voluntary or
otherwise, then, before any distribution or payment shall be made to the holders
of Common Shares or any class of stock of the corporation ranking junior to the
Series B Participating Preferred Shares in respect of the liquidation,
dissolution or winding up of the corporation, first (1) the holders of the
Series B Participating Preferred Shares shall be entitled to be paid an amount
in dollars equal to (a) the Class A Multiple per share, plus (b) any accrued,
accumulated and unpaid dividends and distributions thereon, whether or not
declared, to the date of such payment and then (2) the holders of the Series B
Participating Preferred Shares shall be entitled to be paid in full an amount
per share equal to the Remaining Assets (as defined below) multiplied by a
fraction (a) the numerator of which is 20,000 and (b) the denominator of which
is the sum of (i) the number of issued and outstanding Series B Participating
Preferred Shares multiplied by 20,000, (ii) the number of issued and outstanding
Class A Common Shares multiplied by 20 and (iii) the number of issued and
outstanding Class B Common Shares.
"Remaining Assets" shall mean the amount of assets legally
available for payment to shareholders of the corporation upon liquidation,
dissolution or winding up of the corporation, voluntary or otherwise, minus any
payments to holders of Preferred Shares upon liquidation, dissolution or winding
up of the corporation, voluntarily or otherwise to be made pursuant to clause
(1) of the first sentence of this Section 5.d. of this Article FOURTH or
pursuant to any amendments to these Amended Articles of Incorporation made by
the Board of Directors providing for the issuance of any other series of
Preferred Shares.
e. Consolidation, Merger, etc. In case the corporation shall
enter into any consolidation, merger, combination or other transaction in which
the Class A Common Shares are exchanged for or converted into other shares or
securities, cash or any other property, then in any such case each Series B
Participating Preferred Share shall at the same time be similarly exchanged for
or converted into an amount per share equal to the Class A Multiple times the
aggregate amount of shares, securities, cash or any other property (payable in
kind), as the case may be, into which or for which each Class A Common Share is
exchanged or changed; provided that, the Series B Participating Preferred Shares
shall not be exchanged for or converted into Common Shares and in lieu thereof
the holders of the Series B Preferred Shares will receive cash or other
consideration in the form and amount determined by the Board of Directors to be
equivalent to the per share amount referred to immediately preceding this
proviso.
f. No Redemption. The Series B Participating Preferred Shares
shall not be redeemable.
g. Fractional Shares. Series B Participating Preferred Shares
may be issued in fractions of a share which shall entitle the holder, in
proportion to such holder's fractional shares, to exercise voting rights,
receive dividends, participate in distributions and have the benefit of all
other rights of holders of Series B Participating Preferred Shares.
3
IN WITNESS WHEREOF, the above-named officer, acting for and on
behalf of the Corporation, has hereunto subscribed his name on this ____ day of
April, 2001.
------------------------------
Name:
Title:
4
Exhibit B
[Form of Right Certificate]
Certificate No. ______ _____Rights
NOT EXERCISABLE AFTER THE EXPIRATION DATE (AS DEFINED IN THE RIGHTS AGREEMENT
REFERRED TO BELOW). THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE
COMPANY, ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER CERTAIN
CIRCUMSTANCES (SPECIFIED IN THE RIGHTS AGREEMENT), RIGHTS BENEFICIALLY OWNED BY
ACQUIRING PERSONS (AS DEFINED IN THE RIGHTS AGREEMENT) OR ANY SUBSEQUENT HOLDER
OF SUCH RIGHTS MAY BECOME NULL AND VOID. [THE RIGHTS REPRESENTED BY THIS RIGHT
CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME AN
ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE OF AN ACQUIRING PERSON (AS SUCH
TERMS ARE DEFINED IN THE RIGHTS AGREEMENT REFERRED TO BELOW). ACCORDINGLY, THIS
RIGHT CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY BECOME NULL AND VOID IN
THE CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF THE RIGHTS AGREEMENT.]*
RIGHT CERTIFICATE
THE XXXXXXXX AND XXXXXXXX COMPANY
This certifies that _____________, or registered assigns, is
the registered holder of the number of Rights set forth above, each of which
entitles the registered holder thereof, subject to the terms and conditions of
the Rights Agreement, dated as of April 18, 2001 (the "Rights Agreement"; terms
defined therein are used herein with the same meaning unless otherwise defined
herein) between The Xxxxxxxx and Xxxxxxxx Company, an Ohio corporation (the
"Company"), and Xxxxx Fargo Bank Minnesota, N.A., as Rights Agent (which term
shall include any successor Rights Agent under the Rights Agreement), to
purchase from the Company at any time after the Distribution Date and prior to
the Expiration Date at the office of the Rights Agent, one one-thousandth of a
fully paid and non-assessable share of Series B Preferred Shares, no par value
per share (the "Preferred Shares"), of the Company at the Purchase Price
initially of $___ per one one-thousandth share (each such one one-thousandth of
a share being a "Unit") of Preferred Shares, upon presentation and surrender of
this Right Certificate with the Election to Purchase and related certificate
duly executed. The number of Rights evidenced by this Right Certificate (and the
number of Units which may be purchased upon exercise thereof) set forth above,
and the Purchase Price per Unit set forth above shall be subject to adjustment
in certain events as provided in the Rights Agreement.
--------
* The portion of the legend in brackets shall be inserted only if
applicable and shall replace the preceding sentence.
Upon the occurrence of a Section 11(a)(ii) Event or Section 13
Event, if the Rights evidenced by this Right Certificate are beneficially owned
by an Acquiring Person or an Affiliate or Associate of any such Acquiring Person
or, under certain circumstances described in the Rights Agreement, a transferee
of any such Acquiring Person, Associate or Affiliate, such Rights shall become
null and void and no holder hereof shall have any right with respect to such
Rights from and after the occurrence of such Section 11(a)(ii) Event or Section
13 Event.
In certain circumstances described in the Rights Agreement,
the Rights evidenced hereby may entitle the registered holder thereof to
purchase capital stock of an entity other than the Company or receive common
stock, cash or other assets, all as provided in the Rights Agreement.
This Right Certificate is subject to all of the terms and
conditions of the Rights Agreement, which terms and conditions are hereby
incorporated herein by reference and made a part hereof and to which Rights
Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Right Certificates. Copies of
the Rights Agreement are on file at the principal office of the Company and are
available from the Company upon written request.
This Right Certificate, with or without other Right
Certificates, upon surrender at the office of the Rights Agent designated for
such purpose, may be exchanged for another Right Certificate or Right
Certificates of like tenor and date evidencing an aggregate number of Rights
equal to the aggregate number of Rights evidenced by the Right Certificate or
Right Certificates surrendered. If this Right Certificate shall be exercised in
part, the registered holder shall be entitled to receive, upon surrender hereof,
another Right Certificate or Right Certificates for the number of whole Rights
not exercised.
Subject to the provisions of the Rights Agreement, the Rights
evidenced by this Certificate may be redeemed by the Company under certain
circumstances at its option at a redemption price of $0.01 per Right, payable at
the Company's option in cash or in common stock of the Company, subject to
adjustment in certain events as provided in the Rights Agreement.
No fractional Preferred Shares are required to be issued upon
the exercise of any Right or Rights evidenced hereby (other than fractions which
are integral multiples of one one-twentieth of a Unit which may, at the election
of the Company, be evidenced by depositary receipts), but in lieu thereof a cash
payment may be made, as provided in the Rights Agreement. The Company has
reserved the right to require prior to the occurrence of a Section 11(a)(ii)
Event or a Section 13 Event that Rights be exercised so that only whole
Preferred Shares are issued. Other than those provisions relating to the
Redemption Price or the number of Units for which a Right is exercisable, any of
the provisions of the Rights Agreement may be amended by the Board of
Directors of the Company in any respect whatsoever up until the Distribution
Date, and thereafter in certain respects which do not adversely affect the
interests of holders of Right Certificates (other than an Acquiring Person or
its Affiliates or Associates).
No holder of this Right Certificate, as such, shall be
entitled to vote or receive dividends or be deemed for any purpose the holder of
Preferred Shares or of any other securities which may at any time be issuable on
the exercise hereof, nor shall anything contained in the Rights Agreement or
herein be construed to confer upon the holder hereof, as such, any of the rights
of a shareholder of the Company or any right to vote for the election of
directors or upon any matter submitted to shareholders at any meeting thereof,
or to give or withhold consent to any corporate action, or to receive notice of
meetings or other actions affecting shareholders (except as provided in the
Rights Agreement), or to receive dividends or subscription rights, or otherwise,
until the Rights evidenced by this Right Certificate shall have been exercised
as provided in the Rights Agreement.
This Right Certificate shall not be valid or obligatory for
any purpose until it shall have been countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the
Company and its corporate seal. Dated as of ____________ ___, 20__.
ATTEST: THE XXXXXXXX AND XXXXXXXX COMPANY
By: By:
-------------------------------- ----------------------------
Name: Name:
Title: Title:
XXXXX FARGO BANK MINNESOTA,
N.A., as Rights Agent
By:
--------------------------------
Name:
Title:
[Form of Reverse Side of Right Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if
such holder desires to transfer the
Right Certificate.)
FOR VALUE RECEIVED __________________________________ hereby sells, assigns and
transfers unto:
--------------------------------------------------------------------------------
(Please print name and address of transferee)
this Right Certificate, together with all right, title and interest therein, and
does hereby irrevocably constitute and appoint ____________ Attorney, to
transfer the within Rights Certificate on the books of the within-named Company,
with full power of substitution.
Dated: _________ ___, 20__
----------------------------
Signature
Signature Medallion Guaranteed:
CERTIFICATE
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) this Right Certificate [ ] is [ ] is not being sold,
assigned and transferred by or on behalf of a Person who is or was an Acquiring
Person or an Affiliate or Associate of any such Acquiring Person (as such terms
are defined pursuant to the Rights Agreement); and
(2) after due inquiry and to the best knowledge of the
undersigned, the undersigned [ ] did [ ] did not acquire the Rights evidenced by
this Right Certificate from any Person who is, was or subsequently became an
Acquiring Person or an Affiliate or Associate of an Acquiring Person.
Dated: _________ ___, 20__
----------------------------
Signature
Signature Medallion Guaranteed:
--------------------------------------------------------------
NOTICE
The signature to the foregoing Assignment and Certificate must
correspond to the name as written upon the face of this Right Certificate in
every particular, without alteration or enlargement or any change whatsoever.
In the event the certification set forth above is not
completed, the Company will deem the beneficial owner of the Rights evidenced by
this Right Certificate to be an Acquiring Person or an Affiliate or Associate
thereof (as defined in the Rights Agreement) and, in the case of an Assignment,
will affix a legend to that effect on any Right Certificates issued in exchange
for this Right Certificate.
FORM OF ELECTION TO PURCHASE
(To be executed if the registered holder
desires to exercise Rights represented
by the Right Certificate.)
To: THE XXXXXXXX AND XXXXXXXX COMPANY
The undersigned hereby irrevocably elects to exercise
______________ Rights represented by this Right Certificate to purchase the
Units issuable upon the exercise of the Rights (or such other securities of the
Company or of any other person or other property which may be issuable upon the
exercise of the Rights) and requests that certificates for such Units be issued
in the name of and delivered to:
-----------------------------------
(Please print name and address)
-----------------------------------
Please insert social security
or other identifying number:
---------------
If such number of Rights shall not be all the Rights evidenced
by this Right Certificate, a new Right Certificate for the balance of such
Rights shall be registered in the name of and delivered to:
-----------------------------------
(Please print name and address)
-----------------------------------
Please insert social security
or other identifying number:
---------------
Dated: _________ ___, 200__
----------------------------
Signature
Signature Medallion Guaranteed:
CERTIFICATE
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) the Rights evidenced by this Right Certificate [ ] are [ ]
are not beneficially owned by an Acquiring Person or an Affiliate or an
Associate of any such Acquiring Person (as defined in the Rights Agreement); and
(2) after due inquiry and to the best knowledge of the
undersigned, the undersigned [ ] did [ ] did not acquire the Rights evidenced by
this Right Certificate from any person who is, was or subsequently became an
Acquiring Person or an Affiliate or Associate of an Acquiring Person.
Dated: _________ ___, 20__
----------------------------
Signature
Signature Medallion Guaranteed:
--------------------------------------------------------------
NOTICE
The signature in the foregoing Election to Purchase and
Certificate must conform to the name as written upon the face of this Right
Certificate in every particular, without alteration or enlargement or any change
whatsoever.
In the event the certification set forth above is not
completed, the Company will deem the beneficial owner of the Rights evidenced by
this Right Certificate to be an Acquiring Person or an Affiliate or Associate
thereof (as defined in the Rights Agreement) and, in the case of an Assignment,
will affix a legend to that effect on any Right Certificates issued in exchange
for this Right Certificate.
Exhibit C
THE XXXXXXXX AND XXXXXXXX COMPANY
SUMMARY OF RIGHTS TO PURCHASE PREFERRED SHARES
On April 18, 2001, the Board of Directors of The Xxxxxxxx and
Xxxxxxxx Company (the "Company") declared a dividend distribution of one right
(a "Right") for each outstanding Class A Common Share, no par value per share,
of the Company (the "Class A Shares") and 1/20th of a Right for each Class B
Common Share, no par value per share, of the Company (the "Class B Shares", and
together with the Class A Shares, the "Common Shares"). The Rights will issue at
5:00 P.M. Dayton, Ohio time on May 6, 2001 (the "Record Date") to shareholders
of record on that date. The following is a summary of the terms of the Rights.
Each Right entitles the registered holder thereof to purchase
from the Company a unit (a "Unit") consisting of one one-thousandth of a share
of the Company's Series B Participating Preferred Shares, no par value per share
(the "Series B Preferred Shares"), at a price of $________, subject to
adjustment under certain circumstances (the "Purchase Price"). The terms of the
Rights are set forth in a Rights Agreement, dated as of April 18, 2001 (the
"Rights Agreement"), between the Company and Xxxxx Fargo Bank Minnesota, N.A.,
as Rights Agent (the "Rights Agent").
As discussed below, initially the Rights are not exercisable,
certificates for the Rights will not be sent to shareholders and the Rights will
automatically trade with the Common Shares.
Until the Distribution Date (as described below) or earlier
redemption or expiration of the Rights, the Rights will be evidenced by the
certificates for Common Shares together with this Summary of Rights, and the
registered holders of Common Shares shall also be the registered holders of the
associated Rights. The Rights Agreement provides that, until the Distribution
Date or earlier redemption or expiration of the Rights, the Rights will be
transferred with and only with the Common Shares. Until the Distribution Date or
earlier redemption or expiration of the Rights, Common Share certificates
delivered after the Record Date upon transfer, sale from the Company's treasury
or new issuance of the Common Shares will contain a legend incorporating the
Rights Agreement by reference, and the surrender or transfer of any of the
Common Share certificates, with or without the aforesaid legend or a copy of the
Summary of Rights attached thereto, will also constitute the transfer of the
Rights associated with the Common Shares represented by such certificate. As
promptly as practicable following the Distribution Date, separate certificates
evidencing the Rights ("Right Certificates") will be mailed to holders of record
of the Common Shares as of the close of business on the Distribution Date, and
such separate certificates alone will evidence the Rights from and after the
Distribution Date.
The Rights will become exercisable after the "Distribution
Date" which shall occur on the earlier of the close of business on (i) the tenth
business day after a public announcement that a person or group of affiliated or
associated persons (an "Acquiring Person"), other than the Company, any
subsidiary of the Company, or any employee benefit plan or employee stock plan
of the Company or of any subsidiary of the Company or any entity organized
appointed, established or holding Common Shares by, for or pursuant to, the
terms of any such plan (an "Exempt Person"), has acquired beneficial ownership
of 15% or more (20% or more for any person or group of affiliated persons that
satisfies both of the criteria set forth in Rule 13d-1(b)(1)(i) and Rule
13d-1(b)(1)(ii) of the General Rules and Regulations under the Securities
Exchange Act of 1934, and who has reported such ownership on Schedule 13G) of
the outstanding number of Class A Shares of the Company, or (ii) the tenth
business day or, if determined by the Board of Directors a specified or
unspecified later date, following the commencement of a tender or exchange offer
(other than a tender or exchange offer by an Exempt Person) which, if
successful, would result in a person (together with its affiliates and
associates) becoming an Acquiring Person, even if no purchases actually occur
pursuant to the offer.
The Rights are not exercisable until the Distribution Date.
The Rights will expire on the close of business on May 6, 2011 (the "Expiration
Date"), unless the Rights earlier are redeemed by the Company as described below
or expire in accordance with the terms of Section 13(d) of the Rights Agreement.
The Series B Preferred Shares will be nonredeemable and will
be of equal rank in respect of the preference as to dividends and to payments
upon the liquidation, dissolution or winding up of the Company with all other
classes or series of the Company's preferred shares. Subject to antidulution
adjustments, each Series B Preferred Share will be entitled to receive, when and
if declared, dividends for each Series B Preferred Share equal to 1,000 times
the aggregate dividends or distributions declared (whether or not paid) from
time to time per Class A Share (other than to the extent that such dividends or
distributions are payable in Class A Shares); provided that, in the event that
during specified periods dividends declared on the Series B Preferred Shares do
not in the aggregate equal $10 per Series B Preferred Share per dividend period,
then each Series B Preferred Share will be entitled to receive, in cash, the
difference between $10 and the per share dividend declared on the Series B
Preferred Shares during such specified periods.
In the event of any liquidation, dissolution or winding up of
the corporation, voluntary or otherwise, then, before any distribution or
payment is made to the holders of Class A Shares, Class B Shares or any class of
stock of the corporation ranking junior to the Series B Preferred Shares in
respect to the liquidation, dissolution or winding up of the corporation, first
(i) the holders of the Series B Preferred Shares would be entitled to be paid in
full the sum of (A) $1,000 per share, plus (B) an amount equal to any accrued
and unpaid dividends and distributions thereon, whether or not declared, to the
date of such payment and then (ii) the holders of the Series B Preferred Shares
would be entitled to proportionately share in the remaining assets of the
Company with the holders of Class A Shares and Class B Shares. Each Series B
Preferred Share will have one vote, voting together with the Common Shares. In
the event of any merger, consolidation or other transaction in which Class A
Shares are changed or
2
converted, each Series B Preferred Share will be entitled to receive an amount
equal to 1,000 (subject to adjustment) times the amount received per Class A
Share.
The number of Series B Preferred Shares or the amount of other
securities or property issuable upon exercise of the Rights is subject to
adjustment from time to time to prevent dilution in the event of a stock
dividend on, or subdivision, combination or reclassification of the Class A
Shares, Class B Shares or Series B Preferred Shares. The Purchase Price is
subject to adjustment in the event of, among other things, the issuance of
certain rights, options or warrants or extraordinary distributions of cash or
other property to holders of the Series B Preferred Shares.
In the event that a person or group becomes an Acquiring
Person, except pursuant to a tender or exchange offer for all outstanding Class
A Shares determined by the Board of Directors to be at a fair price and
otherwise in the best interests of the Company and its shareholders (a "Flip-in
Event"), each holder of a Right (other than the Acquiring Person) will
thereafter be entitled to receive, upon payment of the Purchase Price, that
number of the Series B Preferred Shares (or, in certain circumstances, cash, a
reduction in the Purchase Price, Class A Shares, Class B Shares, other equity or
debt securities of the Company, other assets or any combination thereof) having
a market value (as determined in the manner set forth in the Rights Agreement)
of two times the Purchase Price.
Any Rights that are, or (under certain circumstances specified
in the Rights Agreement) were, beneficially owned by an Acquiring Person will be
null and void. Rights are not exercisable following the occurrence of a Flip-in
Event until such time as the Rights are no longer redeemable by the Company as
set forth below.
Unless the Rights are earlier redeemed, in the event that on
or after the date a person or group becomes an Acquiring Person (1) the Company
is acquired in a merger or other business combination transaction (in which any
Class A Shares are changed into or exchanged for other securities or property)
or (2) more than 50% of the assets or earning power of the Company and its
subsidiaries (taken as a whole) are sold or transferred in one transaction or a
series of related transactions (collectively, a "Flip-Over Event"), proper
provision will be made so that each holder of Rights will be entitled to
receive, upon payment of the Purchase Price, that number of common shares (or,
under certain circumstances, an economically equivalent security or securities)
of the surviving, resulting or acquiring company which at the time of such
transaction has a market value (as determined the manner set forth in the Rights
Agreement) of two times the Purchase Price.
The Purchase Price payable upon exercise of the Rights, and
the number of Series B Preferred Shares or other securities or property issuable
upon exercise, are subject to adjustment from time to time to prevent dilution
(i) in the event of a stock dividend on, or a subdivision, combination or
reclassification of, the Series B Preferred Shares, (ii) upon the grant to
holders of the Series B Preferred Shares of certain rights, options, or warrants
to subscribe for Series B Preferred Shares or convertible securities at less
than the current market price of the Series B Preferred Shares, or (iii) upon
the distribution to holders of the Series B Preferred Shares of evidences of
indebtedness or cash, assets, stock (other than dividends payable in Series B
Preferred Shares) or of subscription rights or warrants (other than those
referred to above).
3
With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments require an adjustment of at least
1% in the Purchase Price. No fractional Series B Preferred Shares (other than
integral multiples of one-twentieth of a Unit which may, upon the election of
the Company, be evidenced by depositary receipts) are required to be issued by
the Company and, in lieu of any fractional shares, an adjustment in cash may be
made.
At any time on or prior to the close of business on the tenth
day after the public announcement that a person or group has become an Acquiring
Person, the Board of Directors may redeem the Rights in whole, but not in part,
at a price of $0.01 per Right (the "Redemption Price"). The Redemption Price may
be paid in cash, Class A Shares or any other form of consideration deemed
appropriate by the Board of Directors. The redemption period may be extended by
the Company at any time prior to the expiration of such period. Immediately upon
the action of the Board of Directors authorizing redemption of the Rights, the
right to exercise the Rights will terminate and the only right of the holders of
Rights will be to receive the Redemption Price.
At any time after a person or group of affiliated persons
becomes an Acquiring Person and until any person or group of affiliated persons
beneficially owns 50% or more of the then-outstanding Class A Shares, the Board
of Directors may exchange all or part of the then-outstanding Rights for Units
(1) on a one-to-one basis or (2) at an exchange ratio equal to (A) the
difference between the aggregate market price of the number of Units to be
received on a Flip-in Event and the Purchase Price, divided by (B) the market
price per Unit upon a Flip-in Event. In such event, the right to exercise the
Rights terminates and the only right thereafter of a holder of such Rights shall
be to receive that number of Units equal to the number of such Rights held by
such holder multiplied by the applicable exchange ratio.
Other than those provisions relating to the amount of the
Redemption Price or the number of Units for which a Right is exercisable any of
the provisions of the Rights Agreement may be amended by the Board of Directors
prior to the Distribution Date. After the Distribution Date, the provisions of
the Rights Agreement may be amended by the Board of Directors in order to cure
any ambiguity, to make changes which do not adversely affect the interests of
holders of Rights, or to shorten or lengthen any time period under the Rights
Agreement, subject to certain limitations. In any event, no amendment to
lengthen the time period for redemption may be made at such time as the Rights
are not redeemable.
Upon becoming exercisable, Rights may be exercised by
completing and signing the Election to Purchase and the accompanying certificate
on the reverse side of the Right Certificate and surrendering such Right
Certificate, together with cash or a certified check or bank draft in the
aggregate amount of the Purchase Price and any applicable transfer tax, to the
Rights Agent. Until a Right is exercised, the holder thereof, by reason of
ownership of a Right, will have no rights as a shareholder of the Company,
including, without limitation, the right to vote or to receive dividends.
A copy of the Rights Agreement has been filed with the
Securities and Exchange Commission as an Exhibit to a Current Report on Form 8-K
dated April 18, 2001. A copy of the Rights Agreement is available free of charge
from the Company. This summary description of
4
the Rights does not purport to be complete and is qualified in its entirety by
reference to the Rights Agreement, which is hereby incorporated herein by
reference.
