Exhibit 4
TEKTRONIX, INC.
AND
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
Rights Agreement
Dated as of June 21, 2000
TABLE OF CONTENTS
Page
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1. Certain Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
2. Appointment of Rights Agent . . . . . . . . . . . . . . . . . . . . . . . . . .6
3. Issue of Rights Certificates. . . . . . . . . . . . . . . . . . . . . . . . . .6
4. Form of Rights Certificates . . . . . . . . . . . . . . . . . . . . . . . . . .8
5. Countersignature and Registration . . . . . . . . . . . . . . . . . . . . . . .9
6. Transfer, Split-Up, Combination and Exchange of Rights Certificates;
Mutilated, Destroyed, Lost or Stolen Rights Certificates. . . . . . . . . . . 10
7. Exercise of Rights; Purchase Price; Expiration Date of Rights . . . . . . . . 11
8. Cancellation and Destruction of Rights Certificates . . . . . . . . . . . . . 12
9. Reservation and Availability of Capital Stock . . . . . . . . . . . . . . . . 13
10. Preferred Stock Record Date . . . . . . . . . . . . . . . . . . . . . . . . . 14
11. Adjustment of Purchase Price, Number of Shares or Number of Rights. . . . . . 15
12. Certificate of Adjusted Purchase Price or Number of Shares. . . . . . . . . . 23
13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power. . . . . 24
14. Fractional Rights and Fractional Shares . . . . . . . . . . . . . . . . . . . 27
15. Rights of Action. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
16. Agreement of Rights Holders . . . . . . . . . . . . . . . . . . . . . . . . . 28
17. Rights Certificate Holder Not Deemed a Shareholder. . . . . . . . . . . . . . 29
18. Concerning the Rights Agent . . . . . . . . . . . . . . . . . . . . . . . . . 30
19. Merger or Consolidation or Change of Name of Rights Agent . . . . . . . . . . 30
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Page
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20. Duties of Rights Agent. . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
21. Change of Rights Agent. . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
22. Issuance of New Rights Certificates . . . . . . . . . . . . . . . . . . . . . 34
23. Redemption. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
24. Exchange. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
25. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
26. Supplements and Amendments. . . . . . . . . . . . . . . . . . . . . . . . . . 39
27. Successors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
28. Benefits of this Agreement. . . . . . . . . . . . . . . . . . . . . . . . . . 40
29. Severability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
30. Determinations and Actions by the Board of Directors, Etc.. . . . . . . . . . 40
31. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
32. Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
33. Descriptive Headings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
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RIGHTS AGREEMENT
RIGHTS AGREEMENT, dated as of June 21, 2000 (the "Agreement"),
between TEKTRONIX, INC., an Oregon corporation (the "Company"), and
CHASEMELLON SHAREHOLDER SERVICES, L.L.C. (the "Rights Agent").
WITNESSETH
WHEREAS, the Board of Directors of the Company authorized and
declared a dividend distribution of one right for each share of Common Stock
(as such term is hereinafter defined) of the Company outstanding at the close
of business on September 7, 1990 (the "1990 Record Date"), and authorized the
issuance of one right for each share of Common Stock of the Company issued
between the 1990 Record Date and the earliest of the Distribution Date, the
Redemption Date and the Expiration Date (as such terms are defined in the
Rights Agreement of the Company, dated as of August 16, 1990 (the "1990
Agreement")), each right initially representing the right to purchase one
one-thousandth of a share of Series A Preferred Stock of the Company having
the rights, powers and preferences set forth in the Restated Articles of
Incorporation of the Company, upon the terms and subject to the conditions
set forth in the 1990 Agreement (the "1990 Rights");
WHEREAS, the 1990 Agreement will expire by its terms on September
7, 2000;
WHEREAS, on June 21, 2000, the Board of Directors of the Company
determined it desirable and in the best interests of the Company and its
shareholders for the Company to adopt a new Rights Agreement; and
WHEREAS, on June 21, 2000 (the "Rights Dividend Declaration Date"),
the Board of Directors of the Company authorized and declared a dividend
distribution of one Right (as hereinafter defined) for each share of common
stock, no par value, of the Company (the "Common Stock") outstanding at the
close of business on September 7, 2000 (the "Record Date"), and authorized
the issuance of one Right (as such number may hereinafter be adjusted
pursuant to the provisions of Section 11(h) hereof) for each share of Common
Stock of the Company issued between the Record Date (whether originally
issued or delivered from the Company's treasury) and the Distribution Date
(as hereinafter defined) each Right initially representing the right to
purchase one one-thousandth of a share of Series B No Par Preferred Shares of
the Company (the "Preferred Stock") having the rights, powers and preferences
set forth in the form of amendment to the Restated Articles of Incorporation
attached hereto as Exhibit A, upon the terms and subject to the conditions
hereinafter set forth (the "Rights").
NOW THEREFORE, in consideration of the mutual agreements set forth
herein, the parties hereby agree as follows:
1. CERTAIN DEFINITIONS. For purposes of this Agreement, the following
terms have the meanings indicated:
a. "Acquiring Person" shall mean any Person (as such term is
hereinafter defined) who or which, together with all Affiliates and
Associates (as such terms are hereinafter defined) of such Person, shall
become the Beneficial Owner (as such term is hereinafter defined) of 15% or
more of the shares of Common Stock then outstanding; provided, however, that
an Acquiring Person shall not include the Company, any Subsidiary (as such
term is hereinafter defined) of the Company or any employee benefit plan of
the Company or of any Subsidiary of the Company, or any entity holding shares
of Common Stock for or pursuant to the terms of any such plan.
Notwithstanding the foregoing, no Person shall be deemed to be an Acquiring
Person as the result of an acquisition of Common Stock by the Company which,
by reducing the number of Common Stock outstanding, increases the
proportionate number of shares beneficially owned by such Person to 15% or
more of the Common Stock of the Company then outstanding; provided, however,
that if a Person shall become the Beneficial Owner of 15% or more of the
Common Stock of the Company then outstanding by reason of share purchases by
the Company and shall, after such share purchases by the Company, become the
Beneficial Owner of additional shares of Common Stock representing one
percent (1%) or more of the Common Stock of the Company (other than pursuant
to a dividend or distribution paid or made by the Company on the outstanding
Common Stock in Common Stock or pursuant to a split or subdivision of the
outstanding Common Stock), then such Person shall be deemed to be an
Acquiring Person unless upon becoming the Beneficial Owner of such additional
Common Stock of the Company such Person does not beneficially own 15% or more
of the Common Stock of the Company then outstanding. Notwithstanding the
foregoing, (i) if the Company's Board of Directors determines in good faith
that a Person who would otherwise be an "Acquiring Person," as defined
pursuant to the foregoing provisions of this paragraph (a), has become such
inadvertently (including, without limitation, because (A) such Person was
unaware that it beneficially owned a percentage of the Common Stock that
would otherwise cause such Person to be an "Acquiring Person," as defined
pursuant to the foregoing provisions of this paragraph (a), or (B) such
Person was aware of the extent of the Common Stock it beneficially owned but
had no actual knowledge of the consequences of such beneficial ownership
under this Agreement) and without any intention of changing or influencing
control of the Company, and if such Person divested or divests as promptly as
practicable a sufficient number of Common Stock so that such Person would no
longer be an "Acquiring Person," as defined pursuant to the foregoing
provisions of this paragraph (a), then such Person shall not be deemed to be
or to have become an "Acquiring Person" for any purposes of this Agreement;
and (ii) if, as of the date hereof, any Person is the Beneficial Owner of 15%
or more of the Common Stock outstanding, such Person shall not be or become
an "Acquiring Person," as defined pursuant to the foregoing provisions of
this paragraph (a), unless and until such time as such Person shall become
the Beneficial Owner of additional shares of Common Stock representing one
percent (1%) or more of the Common Stock other than pursuant to a dividend or
distribution paid or made by the Company on the outstanding Common Stock in
Common
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Stock or pursuant to a split or subdivision of the outstanding Common Stock,
unless, upon becoming the Beneficial Owner of such additional Common Stock,
such Person is not then the Beneficial Owner of 15% or more of the Common
Stock then outstanding.
b. "Act" shall mean the Securities Act of 1933, as amended.
c. "Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 of the General Rules and Regulations
under the Exchange Act (as such term is hereinafter defined), as in effect on
the date of this Agreement.
d. "Agreement" shall mean this Rights Agreement.
e. 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 beneficially owns, directly or indirectly, for purposes of
Section 13(d) of the Exchange Act and Rule 13d-3 thereunder (or any
comparable or successor law or regulation), 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 security under this subparagraph (i) as a
result of an agreement, arrangement or understanding to vote such security
if such agreement, arrangement or understanding (A) arises solely from a
revocable proxy given in response to a public proxy or consent solicitation
made pursuant to, and in accordance with, the applicable provisions of the
General Rules and Regulations under the Exchange Act, (B) is not reportable
by such Person on Schedule 13D under the Exchange Act (or any comparable or
successor report) and (C) does not constitute a trust, proxy, power of
attorney or other device with the purpose or effect of allowing two or more
persons, acting in concert, to avoid being deemed "Beneficial Owners" of
such security or otherwise avoid the status of "Acquiring Person" under the
terms of this Agreement or as part of a plan or scheme to avoid the
reporting requirements under Schedule 13D or Sections 13(d) or 13(g) of the
Exchange Act;
ii. which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has the right to acquire voting or
dispositive power over (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) (other than customary agreements
with and between underwriters and selling group members with respect to a
bona fide public offering of securities), or upon the exercise of
conversion rights, exchange rights, 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
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by such Person or any of such Persons' Affiliates or Associates until such
tendered securities are accepted for purchase or exchange, and (B)
securities issuable upon exercise of Rights at any time prior to the
occurrence of a Stock Acquisition Date.
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 or disposing of any securities of the Company;
PROVIDED, HOWEVER, that nothing in this paragraph (iii) shall cause a
person to be the "Beneficial Owner" of, or to "beneficially own," (A) any
securities that may be issued on the exercise of Rights, (B) any security
if the agreement, arrangement or understanding to vote such security arises
solely from a revocable proxy or consent given to such Person in response
to a public proxy or consent solicitation made pursuant to, and in
accordance with, the applicable rules and regulations of the Exchange Act,
(C) 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, or
(D) any, securities acquired by a person engaged in business as an
underwriter of securities through such person's participation in good faith
in a firm commitment underwriting until the expiration of 40 days after the
date of such acquisition. For all purposes of this Agreement, any
calculation of the number of shares of Common Stock outstanding at any
particular time for purposes of determining the particular percentage of
such outstanding shares of Common Stock 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.
f. "Business Day" shall mean any day other than a Saturday, a
Sunday, or a day on which banking institutions in the State of Oregon or the
State of New York are authorized or obligated by law or executive order to
close.
g. "Close of Business" on any given date shall mean 5:00 p.m.,
State of Washington time, on such date; provided, however, that if such date
is not a Business Day, it shall mean 5:00 p.m., State of Washington time, on
the next succeeding Business Day.
h. "Common Stock" shall mean the Common Shares, without par
value, of the Company. The term "common stock" when used with reference to
any Person other than the Company shall mean the capital stock (or equity
interest) with the greatest voting power of such other Person together with
all rights and benefits (however denominated or constituted) relating to such
common stock (including, without limitation, any rights or warrants to
acquire additional shares of such common stock or other securities or assets,
or to participate in any trust for the benefit of holders of such shares, or
to share in the benefits of any agreements or other arrangements for the
benefit of such holders), whether or not such rights are yet
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exercisable, and together with any other securities which are represented by
the certificates for such common stock or are transferred in connection with
transfers of such common stock.
i. "Common Stock Equivalents" shall have the meaning set forth in
Section 11(a)(iii).
j. "Current Per Share Market Price" shall have the meaning set
forth in Section 11(d).
k. "Current Value" shall have the meaning set forth in Section
11(a)(iii).
l. "Distribution Date" shall have the meaning set forth in
Section 3(a).
m. "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.
n. "Final Expiration Date" shall have the meaning set forth in
Section 7(a).
o. "Person" shall mean any individual, firm, corporation,
partnership or other entity and shall include any successor (by merger or
otherwise) of such entity.
p. "Preferred Stock" means Series B No Par Preferred Shares of
the Company and, to the extent that there is not a sufficient number of
Series B No Par Preferred Shares authorized to permit the full exercise of
the Rights, any other series of Preferred Shares of the Company designated
for such purpose containing terms substantially similar to the terms of the
Series B No Par Preferred Shares.
q. "Preferred Stock Equivalents" shall have the meaning set forth
in Section 11(b).
r. "Principal Party" shall have the meaning set forth in Section
13(b).
s. "Proposed Acquiror" shall mean any Person who has proposed or
publicly announced an intention to propose a transaction that, if
consummated, would cause a Stock Acquisition Date or any Section 13 Event to
occur.
t. "Purchase Price" shall mean the dollar amount payable upon
exercise of one Right to acquire the number of one one-thousandths of a share
of Preferred Stock or other securities or assets for which the Right is then
exercisable and shall initially be the price set forth in Section 7(b).
u. "Record Date" shall have the meaning set forth in the WHEREAS
clause at the beginning of this Agreement.
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v. "Redemption Date" shall have the meaning set forth in Section
7(a).
w. "Redemption Price" shall have the meaning set forth in Section
23(a).
x. "Rights" shall have the meaning set forth in the WHEREAS
clause at the beginning of this Agreement.
y. "Rights Certificate" shall have the meaning set forth in
Section 3(a).
z. "Section 13 Event" shall mean any event described in Section
13(a).
aa. "Spread" shall have the meaning set forth in Section
11(a)(iii).
bb. "Section 11(h) Event" shall have the meaning set forth in
Section 11(i).
cc. "Stock Acquisition Date" shall mean the first date of public
announcement (including, without limitation, the date a report is filed
pursuant to Section 13(d) of the Exchange Act) by the Company or an Acquiring
Person that an Acquiring Person has become an Acquiring Person.
dd. "Subsidiary" of any Person shall mean any corporation or other
entity of which a majority of the voting power of the voting equity
securities or equity interest is owned, directly or indirectly, by such
Person.
ee. "Substitution Period" shall have the meaning set forth in
Section 11(a)(iii).
ff. "Trading Day" shall have the meaning set forth in Section
11(d).
2. APPOINTMENT OF RIGHTS AGENT. The Company hereby appoints the
Rights Agent to act as agent for 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 appoint such co-Rights Agents as it may deem
necessary or desirable. The Rights Agent shall have no duty to supervise,
and in no event shall be liable for, the acts or omissions of any such
co-Rights Agent.
3. ISSUE OF RIGHTS CERTIFICATES.
a. Until the earlier of (i) the Close of Business on the tenth
day after the Stock Acquisition Date (or, if the tenth day after the Stock
Acquisition Date is prior to the Record Date, the Close of Business on the
Record Date) or (ii) the Close of Business on the tenth day after the date
that a tender or exchange offer by any Person (other than the
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Company, any Subsidiary of the Company, any employee benefit plan of the
Company or of any Subsidiary of the Company, or any entity holding shares of
Common Stock for or pursuant to the terms of any such plan) is first
published or sent or given within the meaning of Rule 14d-2(a) of the General
Rules and Regulations under the Exchange Act, if upon consummation thereof,
such Person would become an Acquiring Person (the earliest of (i) and (ii)
being herein referred to as the "Distribution Date"), (w) the Rights will be
evidenced by the certificates for the Common Stock registered in the names of
the holders of the Common Stock (which certificates shall also be deemed to
be certificates for Rights) and not by separate Rights Certificates, (x) the
Rights and the right to receive Rights Certificates will be transferable only
in connection with the transfer of the underlying Common Stock (including a
transfer to the Company) and any transfer of Common Stock shall also
constitute the transfer of the associated Rights represented by the same
certificate, (y) in the event the Company purchases or acquires any Common
Stock after the Record Date but prior to the Distribution Date, any Rights
associated with such acquired Common Stock shall be deemed canceled and
retired so that the Company shall not be entitled to exercise any Rights
associated with shares of Common Stock that are no longer outstanding, and
(z) in the event the Company issues any Common Stock after the Record Date
but prior to the earliest of the Distribution Date, the Redemption Date or
the Final Expiration Date, the Company shall issue one Right for each such
newly issued share of Common Stock (subject to adjustment as provided in
Section 11(h)) which Right shall be evidenced by the certificate for the
associated share of Common Stock. As soon as practicable after the
Distribution Date, the Company will prepare and execute, the Rights Agent
will countersign, and the Company will send or cause to be sent (and the
Rights Agent will, if requested and provided with all necessary information,
send) by first-class, postage-prepaid mail, to each record holder of shares
of Common Stock as of the Close of Business on the Distribution Date, at the
address of such holder shown on the records of the Company, a Rights
Certificate, in substantially the form of Exhibit B hereto (a "Rights
Certificate"), evidencing one Right for each share of Common Stock so held,
subject to adjustment as provided herein. In the event that an adjustment in
the number of Rights per share of Common Stock has been made pursuant to
Section 11(h), at the time the Rights Certificates are distributed the
Company shall make the necessary and appropriate rounding adjustments
pursuant to Section 14 (a) so that Rights Certificates are distributed
representing only whole numbers of Rights and cash is paid in lieu of
fractional Rights. As of and after the Distribution Date, the Rights will be
evidenced solely by such Rights Certificates.
b. As soon as practicable following the Record Date, the Company
will make available a copy of a Summary of Rights to Purchase Preferred
Stock, in substantially the form of Exhibit C (the "Summary of Rights"), to
each record holder of shares of Common Stock who may so request from time to
time prior to the Expiration Date.
c. All Common Stock certificates which are issued, either upon an
original issuance by the Company or upon a transfer by a holder, after the
Record Date but prior to the earliest of the Distribution Date, the
Redemption Date or the Final Expiration Date, shall have impressed on,
printed on, written on or otherwise affixed to them the following legend:
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This certificate also evidences and entitles the holder
hereof to certain Rights set forth in a Rights Agreement
between Tektronix, Inc. (the "Company") and the Rights Agent
thereunder, dated as of June 21, 2000 (the "Rights
Agreement"), the terms of which are incorporated herein by
reference and a copy of which is on file at the principal
executive offices of the 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 Company
will mail to the holder of this certificate a copy of the
Rights Agreement without charge after receipt of a written
request therefor. Under certain circumstances, Rights
beneficially owned by Acquiring Persons or their Affiliates
or Associates (as such terms are defined in the Rights
Agreement), and Rights previously owned by such Persons, may
become null and void.
4. FORM OF RIGHTS CERTIFICATES.
a. The Rights Certificates (and the form of election to purchase
and form of assignment to be printed on the reverse thereof) shall be
substantially the same as Exhibit B hereto and may have such marks of
identification or designation and such legends, summaries or endorsements
printed thereon as the Company may deem appropriate (but which do not affect
the rights, duties, or responsibilities of the Rights Agent) 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, the Rights Certificates,
whenever distributed, shall entitle the holders thereof to purchase for the
Purchase Price such number of one one-thousandths of a share of Preferred
Stock as shall be set forth therein, but the amount and type of securities
purchasable upon exercise and the Purchase Price shall be subject to
adjustment as provided herein.
b. Any Rights Certificate issued pursuant to Section 3 hereof
that represents Rights beneficially owned by (i) an Acquiring Person or any
Associate or Affiliate of an Acquiring Person, (ii) any other Person if such
Rights formerly were beneficially owned by an Acquiring Person (or by an
Associate or Affiliate of such Acquiring Person) at a time after the
Acquiring Person became an Acquiring Person, or (iii) a transferee of Rights
from an Acquiring Person (or from any Associate or Affiliate thereof) who
became a transferee prior to or concurrently with the Acquiring Person
becoming an Acquiring Person and receives such Rights pursuant to either (A)
a transfer (whether or not for consideration) from the Acquiring Person (or
its Affiliate or Associate) to holders of equity interests in such Acquiring
Person (or
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its Affiliate or Associate) or to any Person with whom such Acquiring Person
(or its Affiliate or Associate) has any continuing agreement, arrangement or
understanding regarding the transferred Rights, or (B) a transfer which the
Board of Directors has determined is part of a plan, arrangement or
understanding that has as a primary purpose or effect the avoidance of
Section 7(e), and any Rights Certificate issued pursuant to Section 6, 7(d)
or 22 upon transfer, exchange, replacement or adjustment of any other Rights
Certificate referred to in this sentence, shall contain the following legend:
The Rights represented by this Rights Certificate are or
were beneficially owned by a Person who was an Acquiring
Person or an Affiliate or Associate of an Acquiring Person
(as such terms are defined, in the Rights Agreement).
Accordingly, this Rights Certificate and the Rights
represented hereby may become null and void in the
circumstances specified in Section 7(e) of the Rights
Agreement;
PROVIDED, HOWEVER, that the Rights Agent shall not have any responsibility to
ascertain the existence of facts that would require the imposition of such
legend and shall be required to impose such legend only if instructed to do
so by the Company or if a holder fails to certify upon transfer or exchange
in the space provided on the Rights Certificate that such holder is not an
Acquiring Person or an Affiliate or Associate of an Acquiring Person.
5. COUNTERSIGNATURE AND REGISTRATION.
a. The Rights 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 signature, and shall be attested by the Secretary or
an Assistant Secretary of the Company, either manually or by facsimile
signature. The Rights Certificates shall be manually countersigned by the
Rights Agent and shall not be valid for any purpose unless countersigned. In
case any officer of the Company who shall have signed any of the Rights
Certificates shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by the
Company, such Rights Certificates, nevertheless, may be countersigned by the
Rights Agent and issued and delivered by the Company with the same force and
effect as though the person who signed such Rights Certificates had not
ceased to be such officer of the Company; and any Rights Certificate may be
signed on behalf of the Company by any person who, at the actual date of the
execution of such Rights Certificate, shall be a proper officer of the
Company to sign such Rights 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 and receipt by the Rights
Agent of all relevant information, the Rights Agent will keep or cause to be
kept, at its offices designated for such purpose, books for registration and
transfer of the Rights Certificates issued hereunder. Such books shall show
the names and addresses of the respective holders of the
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Rights Certificates, the number of Rights evidenced on its face by each of
the Rights Certificates and the date of each of the Rights Certificates.
6. TRANSFER, SPLIT-UP, COMBINATION AND EXCHANGE OF RIGHTS
CERTIFICATES; MUTILATED, DESTROYED, LOST OR STOLEN RIGHTS CERTIFICATES.
a. Subject to the provisions of sections 4(b), 7(e), 14 and 24,
at any time after the Close of Business on the Distribution Date, and at or
prior to the Close of Business on the earlier of the Redemption Date or the
Final Expiration Date, any Rights Certificate or Certificates may be
transferred, split up, combined or exchanged for another Rights Certificate
or Certificates, entitling the registered holder to purchase a like number of
one-thousandths of a share of Preferred Stock (or, following a Stock
Acquisition Date, cash, securities or other assets, as the case may be) as
the Rights Certificate or certificates surrendered then entitled such holder
to purchase. Any registered holder desiring to transfer, split up, combine
or exchange any Rights Certificate or Certificates shall make such request in
writing delivered to the Rights Agent and shall surrender the Rights
certificate or Certificates to be transferred, split up, combined or
exchanged at the office 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 Rights
Certificate until the registered holder shall have properly completed and
signed the certificate contained in the form of assignment on the reverse
side of such Rights Certificate 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 or the Rights Agent shall
reasonably request. Thereupon the Rights Agent shall, subject to Sections
4(b), 7(e), 14 and 24, countersign and deliver to the person entitled thereto
a Rights Certificate or Rights Certificates, as the case may be, as so
requested. The Company may require payment 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 Rights Certificates. The
Rights Agent shall have no duty or obligation to take any action under any
Section of this Agreement which requires the payment by a Rights holder of
applicable taxes or governmental charges unless and until the Rights Agent is
satisfied that all such taxes and/or charges have been paid.
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 Rights Certificate, and, in case of loss, theft or destruction, of
indemnity or security satisfactory to them, and, at the Company's request,
reimbursement to the Company and the Rights Agent of all reasonable expenses
incidental thereto, and upon surrender to the Rights Agent and cancellation
of the Rights Certificate if mutilated, the Company will make and deliver a
new Rights Certificate of like tenor to the Rights Agent for delivery to the
registered holder in lieu of the Rights Certificate so lost, stolen,
destroyed or mutilated.
10
7. EXERCISE OF RIGHTS; PURCHASE PRICE; EXPIRATION DATE OF RIGHTS.
a. At any time after the Distribution Date and at or prior to the
earlier of (i) the Close of Business on September 7, 2010 or such later date
as may be established by the Board of Directors prior to the expiration of
the Rights (the "Final Expiration Date") or (ii) the time at which the Rights
are redeemed as provided in Section 23 (the "Redemption Date"), subject to
Section 7(e), the registered holder of any Rights Certificate may exercise
the Rights evidenced thereby (except as otherwise provided herein including,
without limitation, the restrictions on exercisability set forth in Sections
9(c), 11(a)(iii) and 23(a) and exchange provisions in Section 24 hereof) in
whole or in part upon surrender of the Rights Certificate, with the form of
election to purchase and certificate on the reverse side thereof duly
executed, to the Rights Agent at the office of the Rights Agent designated
for such purpose, together with payment of the Purchase Price for each Right
that is exercised.
b. The Purchase Price to be paid on exercise of each Right shall
initially be $375.00 and shall be payable in lawful money of the United
States of America in accordance with paragraph (c) below. Each Right shall
initially entitle the holder to acquire one one-thousandth of a share of
Preferred Stock upon exercise of the Right. The Purchase Price and the
number of shares of Preferred Stock or other securities or assets for which a
Right is exercisable shall be subject to adjustment as provided in Sections
11 and 13.
c. Upon receipt of a Rights Certificate representing exercisable
Rights, with the form of election to purchase duly executed, accompanied by
payment of the Purchase Price for the Preferred Stock (or other shares,
securities, cash or other assets, as the case may be) to be purchased and an
amount equal to any applicable tax or governmental charge as set forth below,
the Rights Agent shall, subject to Section 20(k), thereupon promptly (i)
requisition from any transfer agent of the Preferred Stock (or make
available, if the Rights Agent is the transfer agent) certificates for the
number of shares of Preferred Stock to be purchased and the Company hereby
authorizes its transfer agent to comply with all such requests, (ii) 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, (iii)
after receipt of the certificates for Preferred Stock cause the same to be
delivered to or upon the order of the registered holder of such Rights
Certificate, registered in such name or names as may be designated by such
holder and (iv) when appropriate, after receipt, deliver such cash to or upon
the order of the registered holder of such Rights Certificate. The payment
of the Purchase Price (as such amount may be reduced pursuant to Section
11(a)) shall be made in cash, by certified bank check or bank draft payable
to the order of the Company or in shares of Common Stock (having a value
determined pursuant to Section 11(a)). In the event that the Company is
obligated to issue other securities (including, but not limited to, debt
securities) of the Company, and/or distribute other property pursuant to
Section 11, the Company covenants that it will make all arrangements
necessary so that such other securities and/or property are available for
distribution by the Rights Agent, if and when necessary to comply with this
Agreement.
11
d. In case the registered holder of any Rights Certificate shall
exercise less than all the Rights evidenced thereby, a new Rights Certificate
evidencing Rights equivalent to the Rights remaining unexercised shall be
issued by the Rights Agent to the registered holder of such Rights
Certificate or to his duly authorized assigns, subject to the provisions of
Section 6 and Section 14.
e. Notwithstanding any other provision of this Agreement, from
and after the occurrence of a Stock Acquisition Date, any Rights beneficially
owned by (i) an Acquiring Person or any Associate or Affiliate of an
Acquiring Person, (ii) any other Person if such Rights formerly were
beneficially owned by an Acquiring Person (or by an Associate or Affiliate of
such Acquiring Person) at a time after such Acquiring Person became an
Acquiring Person, or (iii) a transferee of Rights from an Acquiring Person
(or from any Associate or Affiliate thereof) who became a transferee prior to
or concurrently with the Acquiring Person becoming an Acquiring Person and
receives such Rights pursuant to either (A) a transfer (whether or not for
consideration) from the Acquiring Person (or its Affiliate or Associate) to
holders of equity interests in such Acquiring Person (or its Affiliate or
Associate) or to any Person with whom the Acquiring Person (or its Affiliate
or Associate) has any continuing agreement, arrangement or understanding
regarding the transferred Rights, or (B) a transfer which the Board of
Directors have determined is part of a plan, arrangement or understanding
that has as a primary purpose or effect the avoidance of this Section 7(e),
shall become null and void and any holder of such Rights shall thereafter
have no right to exercise such Rights under any provision of this Agreement.
The Company shall promptly notify the Rights Agent of the applicability of
this Section 7(e), and the Company shall use all reasonable efforts to ensure
that the provisions of this Section 7(e) and of Section 4(b) are complied
with, but neither the Company nor the Rights Agent shall have any liability
to any holder of Rights Certificates or any other Person as a result of their
failure to make any determinations with respect to an Acquiring Person, or
any of its Affiliates, Associates or transferees 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 upon the occurrence of any
purported exercise as set forth in this Section 7 unless such registered
holder shall have (i) properly completed and signed the certificate contained
in the form of election to purchase set forth on the reverse side of the
surrendered Right Certificate and (ii) provided such additional evidence of
the identity of the Beneficial Owner (or former Beneficial Owner) or
Affiliates or Associates thereof as the Company or the Rights Agent shall
reasonably request.
8. CANCELLATION AND DESTRUCTION OF RIGHTS CERTIFICATES. All Rights
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 canceled
form, or, if surrendered to the Rights Agent, shall be canceled by it, and no
Rights Certificates shall be issued in lieu thereof except as expressly
permitted by
12
any of the provisions of 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 Rights Certificate purchased or acquired by the
Company otherwise than upon the exercise thereof. The Rights Agent shall
deliver all canceled Rights Certificates to the Company, or shall, at the
written request of the Company, destroy such canceled Rights Certificates,
and in such case shall deliver a certificate of destruction thereof to the
Company.
9. RESERVATION AND AVAILABILITY OF CAPITAL STOCK.
a. The Company covenants and agrees that it will cause to be
reserved and kept available out of its authorized and unissued Preferred
Stock (and, following the occurrence of a Stock Acquisition Date or a Section
13 Event, out of its authorized and unissued shares of Common Stock and/or
other securities), the number of shares of Preferred Stock (and, following
the occurrence of a Stock Acquisition Date or a Section 13 Event, Common
Stock and/or other securities) that, as provided in this Agreement, will be
sufficient to permit the exercise in full of all outstanding Rights;
provided, however, that shares issuable pursuant to Section 11(a)(ii) shall
be reserved only following the occurrence of an event described in that
section.
b. If any shares of Preferred Stock are listed on a national
securities exchange, and so long as the shares of Preferred Stock (and,
following the occurrence of a Stock Acquisition Date or a Section 13 Event,
Common Stock and/or other securities) issuable and deliverable upon the
exercise of the Rights may be listed on that exchange, the Company shall use
its best efforts to cause, from and after such time as the Rights become
exercisable, all shares reserved for such issuance to be listed on the
exchange upon official notice of issuance upon exercise.
c. The Company shall use its best efforts (i) to file, as soon as
practicable following a Stock Acquisition Date and the determination by the
Company in accordance with section 11(a)(iii) of the consideration to be
delivered by the Company upon exercise of the Rights, or as soon as is
required by law following the Distribution Date, as the case may be, a
registration statement under the Act with respect to the securities
purchasable upon exercise of the Rights on an appropriate form, (ii) to cause
such registration statement to become effective as soon as practicable after
such filing, and (iii) to cause such registration statement to remain
effective (with a prospectus at all times meeting the requirements of the
Act) until the earlier of (A) the date as of which the Rights are no longer
exercisable for such securities, and (B) the date of the expiration of the
Rights. 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 temporarily suspend the exercisability of the Rights, for a
period of time not to exceed 90 days after the date the Company first becomes
obligated to use its best efforts to file a registration statement as set
forth in clause (i) of the first sentence of this Section 9(c), in order to
prepare and file such registration statement and permit it to become
effective. Upon any such
13
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.
The Company will promptly notify the Rights Agent whenever it makes a public
announcement pursuant to this Section 9(c) and will promptly provide the
Rights Agent with a copy of such announcement. Notwithstanding any provision
of this Agreement to the contrary, the Rights shall not be exercisable in any
jurisdiction, unless the requisite qualification in such jurisdiction shall
have been obtained and until a registration statement has been declared
effective.
d. The Company covenants and agrees that it will take all such
action as may be necessary to ensure that all shares of Preferred Stock (and,
following the occurrence of a Stock Acquisition Date or Section 13 Event,
Common Stock and/or other securities) delivered upon exercise of Rights
shall, at the time of delivery of the certificates for such shares of such
shares (subject to payment of the Purchase Price), be duly and validly
authorized and issued and fully paid and nonassessable shares.
e. The Company further covenants and agrees that it will pay when
due and payable any and all taxes and governmental charges which may be
payable in respect of the issuance or delivery of the Rights Certificates or
of any shares of Preferred Stock or other securities upon the exercise of
Rights. The Company shall not, however, be required to pay any tax or
governmental charge which may be payable in respect of any transfer,
split-up, combination or exchange of Rights Certificates, or any issuance or
delivery of certificates for shares in a name other than that of the
registered holder of the Rights Certificate evidencing Rights surrendered for
exercise, and shall not be required to issue or deliver any certificates for
shares upon the exercise of any Rights until any such tax or charge shall
have been paid (any such tax or charge being payable by the holder of such
Rights Certificate at the time of surrender) or until it has been established
to the Company's satisfaction that no such tax or charge is due.
10. PREFERRED STOCK RECORD DATE. Each Person in whose name any
certificate for a number of one one-thousandths of a share of Preferred Stock
(or Common Stock and/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 such fractional shares of Preferred Stock (or Common
Stock and/or other securities, as the case may be) represented thereby on,
and such certificate shall be dated, the date upon which the Rights
Certificate evidencing such Rights was duly surrendered and payment of the
Purchase Price (and any applicable taxes or governmental charges) was made;
provided, however, that if the date of such surrender and payment is a date
upon which the Preferred Stock (or Common Stock and/or other securities, as
the case may be) transfer books of the Company 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 Preferred Stock (or Common Stock and/or other
securities, as the case may be) transfer books of the Company are open.
Prior to the exercise of the Rights evidenced thereby, the holder of a Rights
Certificate shall
14
not be entitled to any rights of a shareholder of the Company with respect to
shares for which the Rights shall be exercisable, including, without
limitation, to receive dividends or other distributions or to exercise any
preemptive rights, and shall not be entitled to receive any notice of any
proceedings of the Company, except as provided herein.
11. ADJUSTMENT OF PURCHASE PRICE, NUMBER OF SHARES OR NUMBER OF RIGHTS.
The Purchase Price, the number and kind of securities covered by 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 on the Preferred Stock payable
in Preferred Stock, (B) subdivide the outstanding Preferred Stock, (C)
combine the outstanding Preferred Stock into a smaller number of shares of
Preferred Stock or (D) issue any shares of its capital stock in a
reclassification of the Preferred Stock (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 this
Section 7(e) and Section 11(a), (1) the Purchase Price in effect at the time
of the record date for such dividend or of the effective date of such
subdivision, combination or reclassification shall be adjusted so that the
Purchase Price thereafter shall equal the result obtained by dividing the
Purchase Price in effect immediately prior to such time by a fraction (the
"Adjustment Fraction"), the numerator of which shall be the total number of
Preferred Stock (or shares of capital stock issued in such reclassification
of the Preferred Stock) outstanding immediately following such time and the
denominator of which shall be the total number of Preferred Stock outstanding
immediately prior to such time, and (2) the number and kind of shares of
capital stock issuable at the time of the record date for such dividend or of
the effective date of such subdivision, combination or reclassification,
shall be proportionately adjusted so that the holder of any Right exercised
after such time shall be entitled to receive the aggregate number and kind of
shares of capital stock which, if such Right had been exercised immediately
prior to such date and at a time when the Preferred Stock transfer books of
the Company were open, he or she would have owned upon such exercise and been
entitled to receive by virtue of such dividend, subdivision, combination or
reclassification. The adjustments provided for in this Section 11(a)(i)
shall be made successively whenever such a dividend is declared or paid or
such a subdivision, combination or reclassification is effected. If an event
occurs which would require an adjustment under both this Section 11(a)(i) and
Section 11(a)(ii), 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).
(ii) In the event that a Stock Acquisition Date occurs, proper
provision shall be made so that each holder of a Right, except as provided
below and in Section 7(e), shall thereafter have a right to receive, upon
exercise thereof and payment of the Purchase Price in accordance with the
terms of this Agreement, in lieu of a number of one one-thousandths of a
share of Preferred Stock, such number of shares of Common Stock as shall
equal the result obtained by dividing the then current Purchase
15
Price by 50 percent of the Current Per Share Market Price of the Common
Stock (determined pursuant to Section 11(d)) on the Stock Acquisition Date
(such number of shares being the "Adjustment Shares").
(iii) In the event the number of shares of Common Stock which are
authorized by the Company's restated articles of incorporation but not
outstanding or reserved for issuance for purposes other than upon exercise
of the Rights are not sufficient to permit the exercise in full of the
Rights in accordance with the foregoing subparagraph (ii) of this
Section 11(a), the Company shall (A) determine the excess of (1) the value
of the Adjustment Shares issuable upon the exercise of a Right (the
"Current Value") over (2) the then current Purchase Price (such excess, the
"Spread"), and (B) with respect to each Right, make adequate provision to
substitute for the Adjustment Shares, upon payment of the applicable
Purchase Price, (1) cash, (2) a reduction in the applicable Purchase Price,
(3) shares of Common Stock or other equity securities of the Company
(including, without limitation, shares, or units of shares, of preferred
stock that the Board of Directors of the Company has deemed to have the
same value as shares of Common Stock ("Common Stock Equivalents")),
(4) debt securities of the Company, (5) other assets, or (6) any
combination of the foregoing, having an aggregate value equal to the
Current Value, where such aggregate value has been determined by the Board
of Directors of the Company based upon the advice of a nationally
recognized investment banking firm selected by the Board of Directors of
the Company; provided, however, if the Company shall not have made adequate
provision to deliver value pursuant to clause (B) above within 30 days
following the Stock Acquisition 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, shares of Common Stock (to the
extent available) and then, if necessary, cash, which shares and/or cash
have an aggregate value equal to the Spread. If the Board of Directors of
the Company shall determine in good faith that it is likely that sufficient
additional shares of Common Stock could be authorized for issuance upon
exercise in full of the Rights, the 30-day period set forth above may be
extended to the extent necessary, but not more than 90 days after the Stock
Acquisition Date, in order that the Company may seek shareholder approval
for the authorization of such additional shares (such period, as it may be
extended as so permitted, the "Substitution Period"). To the extent the
Company determines that some action must be taken pursuant to the first or
second sentences of this Section 11(a)(iii), the Company (x) shall provide
that such action shall apply uniformly to all outstanding Rights other than
those that are null and void as provided in Section 7(e), and (y) may
suspend the exercisability of the Rights until the expiration of the
Substitution Period in order to seek any authorization of additional shares
and/or to decide the appropriate form of distribution to be made pursuant
to such first sentence 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 (with prompt notice by the Company of such
16
announcements (as well as a written copy) to the Rights Agent). For
purposes of this Section 11(a)(iii), the value of the Common Stock shall be
the Current Per Share Market Price (as determined pursuant to Section 11(d)
hereof) of the Common Stock on the date of the Stock Acquisition Date and
the value of any Common Stock Equivalent shall be deemed to have the same
value as the Common Stock on such date.
b. In case 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 Stock entitling them (for a period expiring
within 45 calendar days after such record date) to subscribe for or purchase
Preferred Stock (or shares having the same rights, privileges and preferences
as the Preferred Stock ("Preferred Stock Equivalents")) or securities
convertible into Preferred Stock or Preferred Stock Equivalents at a price
per share of Preferred Stock or Preferred Stock Equivalent (or having a
conversion price per share, if a security convertible into Preferred Stock or
Preferred Stock Equivalents) less than the then Current Per Share Market
Price of the Preferred Stock (as defined in Section 11(d)) on such record
date, the number of shares of Preferred Stock for which each Right shall be
exercisable after such record date shall be determined by multiplying the
number of shares of Preferred Stock for which each Right was exercisable
immediately prior to such record date by a fraction, the numerator of which
shall be the number of shares of Preferred Stock outstanding on such record
date plus the number of additional shares of Preferred Stock and/or Preferred
Stock Equivalents to be offered for subscription or purchase (or into which
the convertible securities so to be offered are initially convertible) and
the denominator of which shall be the number of shares of Preferred Stock
outstanding on such record date plus the number of shares of Preferred Stock
which the aggregate offering price of the total number of shares of Preferred
Stock and/or Preferred Stock Equivalents so to be offered (and/or the
aggregate initial conversion price of the convertible securities so to be
offered) would purchase at such Current Per Share Market Price. In case such
subscription price may be paid in a consideration part or all of which shall
be in a form other than cash, the value of such consideration shall be as
determined in good faith by the Board of Directors, whose determination shall
be described in a statement filed with the Rights Agent and which shall be
binding on the Rights Agent and the holders of the Rights. Preferred Stock
owned by or held for the account of the Company shall not be deemed
outstanding for the purpose of any such computation. Such adjustment shall
be made successively whenever such a record date is fixed; and in the event
that such rights, options or warrants are not so issued, the number of shares
of Preferred Stock for which each Right shall be exercisable shall be
readjusted to be the number of shares of Preferred Stock for which each Right
would then be exercisable if such record date had not been fixed; and to the
extent such rights, options or warrants are issued but not exercised prior to
their expiration, the number of shares for which each Right shall be
exercisable shall be readjusted to be the number which would have resulted
from the adjustment provided for in this Section 11(b) if only the rights or
warrants that were exercised had been issued.
c. (i) In case the Company shall at any time after the date of
this Agreement fix a record date for the making of a distribution to all
holders of Preferred Stock
17
(including any such distribution made in connection with a consolidation or
merger in which the Company is the continuing or surviving corporation) of
evidences of indebtedness or assets (other than a regular quarterly cash
dividend or a dividend payable in shares of Preferred Stock but including any
dividend payable in stock other than Preferred Stock) or subscription rights
or warrants (excluding those referred to in Section 11(b)), the number of
shares of Preferred Stock for which each Right shall be exercisable after
such record date shall be determined by multiplying the number of shares of
Preferred Stock for which each Right was exercisable immediately prior to
such record date by a fraction, the numerator of which shall be the then
Current Per Share Market Price of the Preferred Stock (as defined in Section
11(d)) on such record date, and the denominator of which shall be such
Current Per Share Market Price of the Preferred Stock, less the fair market
value (as determined in good faith by the Board of Directors, whose
determination shall be described in a statement filed with the Rights Agent
and which shall be binding on the Rights Agent and the holders of the Rights)
of the portion of the assets or evidences of indebtedness so to be
distributed or of such subscription rights or warrants applicable to one
share of Preferred Stock. 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 number of shares of Preferred Stock for which each Right
shall be exercisable shall be readjusted to be the number of shares of
Preferred Stock for which each Right would then be exercisable if such record
date had not been fixed.
(ii) In case the Company shall at any time after the date of
this Agreement fix a record date for the making of a distribution to all
holders of Common Stock (including any such distribution made in connection
with a consolidation or merger in which the Company is the continuing or
surviving corporation) of evidences of indebtedness or assets (other than a
regular quarterly cash dividend or a dividend payable in shares of Common
Stock) or subscription rights or warrants (excluding those referred to in
Section 11(h)(ii)), the number of shares of Preferred Stock for which each
Right shall be exercisable after such record date shall be determined by
multiplying the number of shares of Preferred Stock for which each Right
was exercisable immediately prior to such record date by a fraction, the
numerator of which shall be the then Current Per Share Market Price of the
Common Stock (as defined in Section 11(d)) on such record date, and the
denominator of which shall be such Current Per Share Market Price of the
Common Stock, less the fair market value (as determined in good faith by
the Board of Directors, whose determination shall be described in a
statement filed with the Rights Agent and which shall be binding on the
Rights Agent and the holders of the Rights) of the portion of the assets or
evidences of indebtedness so to be distributed or of such subscription
rights or warrants applicable to one share of Common Stock. 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 number
of shares of Preferred Stock for which each Right shall be exercisable
shall be readjusted to be the number of shares of Preferred Stock for which
each Right would then be exercisable if such record date had not been
fixed.
18
d. (i) For the purposes of any computation hereunder, the
"Current Per Share Market Price" of common stock (including Common Stock) on
any date shall be deemed to be the average of the daily closing prices per
share of the common stock for the 30 consecutive Trading Days (as such term
is hereinafter defined) immediately prior but not including to such date;
PROVIDED, HOWEVER, that in the event the Current Per Share Market Price of
common stock is determined during a period following the announcement by the
issuer of such common stock of (A) a dividend or distribution on such common
stock payable in such common stock or securities convertible into such common
stock, or (B) any subdivision, combination or reclassification of such common
stock, and prior to the expiration of 30 Trading Days after but not including
the ex-dividend date for such dividend or distribution, or the record date
for such subdivision, combination or reclassification, then, and in each such
case, the Current Per Share Market Price shall be appropriately adjusted to
take into account such event. The closing price for each day shall be the
last sale 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 common stock is 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 common stock is listed or
admitted to trading or, if the common stock is 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 the National Association of
Securities Dealers, Inc. Automated Quotations System ("NASDAQ") or such other
system then in use, or, if on any such date the common stock is 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 common stock
selected by a majority of the Board of Directors. The term "Trading Day"
shall mean a day on which the principal national securities exchange on which
the common stock is listed or admitted to trading is open for the transaction
of business or, if the common stock is not listed or admitted to trading on
any national securities exchange, a Business Day. If the common stock is not
publicly held or so listed or traded, "Current Per Share Market Price" shall
mean the fair value per share as determined in good faith by the Board of
Directors of the Company, whose determination shall be described in a
statement filed with the Rights Agent and which shall be binding on the
Rights Agent and the holders of the Rights.
(ii) For the purpose of any computation hereunder, the "Current
Per Share Market Price" of Preferred Stock shall be determined in the same
manner as set forth above for the Common Stock in clause (i) of this
Section 11(d) (other than the last sentence thereof). If the Current Per
Share Market Price of Preferred Stock cannot be determined in the manner
provided above or if the Preferred Stock is not publicly held or listed or
traded in a manner described in clause (i) of this Section 11(d), the
"Current Per Share Market Price" of Preferred Stock shall be conclusively
deemed to be an amount equal to the Current Per Share Market Price of the
Common Stock
19
multiplied by the Adjustment Number as that term is defined in Section 2
of the Amendment to the Company's Restated Articles of Incorporation
designating the Preferred Stock (initially 1,000). If neither the Common
Stock nor the Preferred Stock is publicly held or so listed or traded,
"Current Per Share Market Price" of Preferred Stock shall mean the fair
value per share as determined in good faith, by the Board of Directors of
the Company, whose determination shall be described in a statement filed
with the Rights Agent and shall be conclusive for all purposes. For all
purposes of this Agreement, the current market price of one one-thousandth
of a share of Preferred Stock shall be equal to the Current Per Share
Market Price of one share of Preferred Stock divided by 1,000.
e. No adjustment in the Purchase Price or the number of shares
for which a Right is exercisable shall be required unless such adjustment
would require an increase or decrease of at least one percent in the Purchase
Price or the number of shares for which a Right is exercisable; provided,
however, that any adjustments which by reason of this Section 11(e) are not
required to be made shall be carried forward and taken into account in any
subsequent adjustment. All calculations under this Section 11 shall be made
to the nearest cent or to the nearest ten-thousandth of a share of Common
Stock or one-millionth of a share of Preferred Stock, 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 years from the date of the transaction which requires such adjustment
or (ii) the date of the expiration of the right to exercise any Rights.
f. If as a result of an adjustment made pursuant to Section
11(a), the holder of any Right thereafter exercised shall become entitled to
receive any shares of capital stock of the Company other than Preferred
Stock, thereafter 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 Stock contained in Section 11 and the provisions of Sections
7, 9, 10, 13 and 14 with respect to the Preferred Stock shall apply on like
terms to any such other shares.
g. All Rights originally issued by the Company subsequent to any
adjustment made to the Purchase Price or the number of shares of Preferred
Stock for which a Right is exercisable hereunder shall evidence the right to
purchase, at the adjusted Purchase Price, the number of one one-thousandths
of a share of Preferred Stock purchasable from time to time hereunder upon
exercise of the Rights, all subject to further adjustment as provided herein.
h. (i) In the event the Company shall, after the date of this
Agreement and prior to the Distribution Date, (A) declare a dividend on the
Common Stock payable in Common Stock, (B) subdivide the outstanding Common
Stock, (C) combine the outstanding Common Stock into a smaller number of
shares of Common Stock, or (D) issue any shares of Common Stock in a
reclassification of the Common Stock (including any such reclassification
20
in connection with a consolidation or merger in which the Company is the
continuing or surviving corporation), the number of Rights associated with
each share of Common Stock then outstanding, and the number of Rights to be
associated with each share of Common Stock which may thereafter become
outstanding prior to the Distribution Date, shall be proportionately adjusted
so that the number of Rights associated with each share of Common Stock
following any such event shall equal the result obtained by multiplying the
number of Rights associated with each share of Common Stock immediately prior
to such event by a fraction, the numerator of which shall be the number of
shares of Common Stock outstanding immediately prior to such event and the
denominator of which shall be the number of shares of Common Stock
outstanding immediately after such event.
(ii) In the event the Company shall, after the date of this
Agreement and prior to the Distribution Date, fix a record date for the
issuance of rights, options or warrants to all holders of Common Stock
entitling them (for a period expiring within 45 calendar days after such
record date) to subscribe for or purchase common stock or securities
convertible into Common Stock at a price per share of Common Stock (or
having a conversion price per share, if a security convertible into common
Stock) less than the then Current Per Share Market Price (as defined in
Section 11(d)) of the Common Stock on such record date, the number of
Rights associated with each share of Common Stock then outstanding, and the
number of Rights to be associated with each share of Common Stock which may
thereafter become outstanding prior to the Distribution Date, shall be
proportionately adjusted so that the number of Rights associated with each
share of Common Stock after such record date shall be determined by
multiplying the number of Rights associated with each share of Common Stock
immediately prior to such record date by a fraction, the numerator of which
shall be the number of shares of Common Stock outstanding on such record
date plus the number of shares of Common Stock which the aggregate offering
price of the total number of shares of Common Stock so to be offered
(and/or the aggregate initial conversion price of the convertible
securities so to be offered) would purchase at such Current Per Share
Market Price and the denominator of which shall be the number of shares of
Common Stock outstanding on such record date plus the number of additional
shares of Common Stock 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 in a
consideration part or all of which shall be in a form other than cash, the
value of such consideration shall be as determined in good faith by the
Board of Directors, whose determination shall be described in a statement
filed with the Rights Agent and shall be conclusive for all purposes.
Common Stock owned by or held for the account of the Company shall not be
deemed outstanding for the purpose of any such computation. Such
adjustment shall be made successively whenever such a record date is fixed.
In the event that such rights, options car warrants are not so issued, the
number of Rights associated with each share of Common Stock shall be
readjusted to be the number of Rights that would have been associated with
each share of Common Stock if such record date had not been fixed and to
the extent such rights, options or
21
warrants are issued but not exercised prior to their expiration, the number
of Rights associated with each share shall be readjusted to be the number
which would have resulted from the adjustment provided for in this
Section 11(h)(ii) if only the rights, options or warrants that were
exercised had been issued.
(iii) Notwithstanding the foregoing, the adjustments provided for
in this Section 11(h) shall not be made if the Company exercises its
election provided for in Section 11(i).
i. The Company may elect on or after the date of any event
described in clauses (A) through (D) of Section 11(h)(i) or described in
Section 11(h)(ii), if such event occurs before the Distribution Date (a
"Section 11(h) Event"), to adjust the Purchase Price and the number of shares
of Preferred Stock purchasable upon the exercise of a Right in substitution
for any adjustment under Section 11(h) in the number of Rights associated
with each share of Common Stock. If such election is made, (i) the number of
Rights associated with each share of Common Stock prior to the Section 1l(h)
Event shall be maintained after the Section 11(h) Event, (ii) any new shares
of Common Stock issued in the Section 11(h) Event shall, as provided in
Section 3(a), have issued with it the number of Rights associated with each
share of Common Stock outstanding, and (iii) any combination of shares of
Common Stock into a smaller number of shares in the Section 11(h) Event shall
result in a similar combination of the associated Rights. The Purchase Price
and the number of shares of Preferred Stock purchasable upon exercise of a
Right after such adjustment shall be determined by multiplying the Purchase
Price and the number of shares of Preferred Stock purchasable upon exercise
of a Right, respectively, in effect immediately prior to such adjustment by a
fraction, the numerator of which shall be the number of Rights that would
have been associated with each share of Common Stock after the Section 11(h)
Event if the Company had not exercised its election provided for in this
Section 11(i) and the denominator of which shall be the number of Rights
associated with each share of Common Stock immediately prior to the Section
11(h) Event. To the extent the number of Rights that would have been
associated with each share of Common Stock if the Company had not exercised
its election provided for in this Section 11(i) may be readjusted as provided
in the last sentence of Section 11(h)(ii), the Purchase Price and number of
shares of Preferred Stock purchasable upon exercise of a Right shall be
similarly readjusted.
j. Irrespective of any adjustment or change in the Purchase Price
or the number of one one-thousandths of a share of Preferred Stock issuable
upon the exercise of the Rights, the Rights Certificates theretofore and
thereafter issued may continue to express the Purchase Price per one
one-thousandth of a share and the number of one one-thousandths of a share of
Preferred Stock which were expressed in the initial Rights Certificates
issued hereunder.
k. In any case in which this Section 11 shall require that an
adjustment in the Purchase Price or the number of one one-thousandths of a
share of Preferred Stock for
22
which a Right is exercisable be made effective as of a record date for a
specified event, the Company may elect to defer (with prompt notice of such
deferral to the Rights Agent) until the occurrence of such event the issuance
to the holder of any Right exercised after such record date the number of one
one-thousandth of a share of Preferred Stock and other capital stock or
securities of the Company, if any, issuable upon such exercise over and above
the number of one one-thousandths of a share of Preferred Stock and other
capital stock or securities of the Company, if any, issuable upon such
exercise on the basis of the Purchase Price and the number of one
one-thousandths of a share of Preferred Stock for which a Right is
exercisable 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
upon the occurrence of the event requiring such adjustment.
l. Anything in this Section 11 to the contrary notwithstanding,
the Company shall be entitled to make such reductions in the Purchase Price,
in addition to those adjustments expressly required by this Section 11, as
and to the extent that in their good faith judgment the Board of Directors
shall determine to be advisable in order that any consolidation or
subdivision of the Preferred Stock, issuance wholly for cash of any Preferred
Stock at less than the current market price, issuance wholly for cash of
Preferred Stock or securities which by their terms are convertible into or
exchangeable for shares of Preferred Stock, dividends on Preferred Stock
payable in Preferred Stock or issuance of rights, options or warrants
referred to in Section 11(b), hereafter made by the Company to holders of its
Preferred Stock shall not be taxable to such shareholders or shall reduce the
taxes payable by such shareholders.
m. The Company covenants and agrees that, after the Distribution
Date, it will not, except as permitted by Section 23 or Section 26, take (or
permit any Subsidiary to take) any action, including any merger,
consolidation or sale of assets if at the time such action is taken or
immediately thereafter it is reasonably foreseeable that such action will
diminish substantially or otherwise eliminate the benefits intended to be
afforded by the Rights.
12. CERTIFICATE OF ADJUSTED PURCHASE PRICE OR NUMBER OF SHARES.
Whenever an adjustment is made as provided in Sections 11 and 13, the Company
shall promptly (a) prepare a certificate setting forth such adjustment and a
brief statement of the facts and computations accounting for such adjustment,
(b) file with the Rights Agent and with each transfer agent for the Preferred
Stock and the Common Stock a copy of such certificate and (c) mail a brief
summary thereof to each holder of Rights in accordance with Section 25. The
Rights Agent shall be fully protected in relying on any such certificate and
on any adjustment contained therein, and the Rights Agent shall have no duty
with respect to and shall not be deemed to have knowledge of any adjustment
unless and until it shall have received such certificate. Notwithstanding
the foregoing sentence, the failure of the Company to make such certification
or give such notice shall not affect the validity of such adjustment or the
force or effect of the requirement of such adjustment.
23
13. CONSOLIDATION, MERGER OR SALE OR TRANSFER OF ASSETS OR EARNING
POWER.
a. In the event that, following the Distribution Date, directly
or indirectly,
i. the Company shall consolidate with, or merge with and into,
any other Person (other than a Subsidiary of the Company in a transaction
that complies with Section 11(m)) and the Company shall not be the
continuing or surviving Person of such consolidation or merger,
ii. any Person shall acquire shares of Common Stock of the
Company in a share exchange,
iii. any Person (other than a Subsidiary of the Company in a
transaction that complies with Section 1l(m)) shall consolidate with the
Company, or merge with and into the Company and the Company shall be the
continuing or surviving corporation of such consolidation or merger and, in
connection with such consolidation or merger, all or part of the
outstanding Common Stock shall be changed into or exchanged for stock or
other securities, of any other Person or cash or any other property, or
iv. the Company shall sell or otherwise transfer (or one or
more of its Subsidiaries shall sell or otherwise transfer), in one or more
transactions, assets or earning power aggregating 50 percent or more of the
assets or earning power of the Company and its Subsidiaries (taken as a
whole) to any Person other than tie Company or one or more of its wholly
owned Subsidiaries in a transaction that complies with Section 11(m),
THEN, and in each such case, proper provision shall be made so that (A) each
holder of a Right (except as otherwise provided in Section 7(e)) shall
thereafter have the right to receive, upon the exercise thereof and payment
of the Purchase Price in accordance with the terms of this Agreement, such
number of validly authorized and issued, fully paid, nonassessable and freely
tradeable shares of common stock of the Principal Party (as hereinafter
defined) not subject to any liens, encumbrances, rights of first refusal or
other adverse claims, as shall be equal to the result obtained by dividing
the then current Purchase Price by 50 percent of the Current Per Share Market
Price of the common stock of the Principal Party (determined pursuant to
Section 11(d)) on the date of consummation of the Section 13 Event, (B) 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, (C) the term "Company" shall thereafter be deemed
to refer to the Principal Party, it being specifically intended that the
provisions of Section 11 shall apply to the Principal Party only following
the first occurrence of a Section 13 Event, and (D) the Principal Party shall
take such steps (including, but not limited to, the reservation of a
sufficient number of shares of its common stock in accordance with Section 9)
in connection with such consummation as may be necessary to ensure that the
24
provisions of this Agreement shall thereafter be applicable, as nearly as
reasonably may be, in relation to the common stock thereafter deliverable
upon the exercise of the Rights. The provisions of Section 11(a)(ii) shall
be of no effect following the first occurrence of an event described in
Section 13.
b. The term "Principal Party" shall mean
i. in the case of any transaction described in clause (i),
(ii) or (iii) of Section 13 (a), the Person that is the issuer of any
securities into which shares of Common Stock of the Company are converted
in such merger or consolidation, or for which shares of Common Stock are
exchanged in such share exchange, and if no securities are so issued, the
Person that is the other party to such merger, consolidation or share
exchange or, if there is more than one such Person, the Person the common
stock of which has the highest aggregate Current Per Share Market Price
(determined pursuant to Section 11(d)); and
ii. in the case of any transaction described in clause (iv) of
Section 13(a), 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
transferred pursuant to such transaction or transactions or if the Person
receiving the largest portion of the assets or earning power cannot be
determined, whichever Person the common stock of which has the highest
aggregate Current Per Share Market Price (determined pursuant to
Section 11(d));
PROVIDED, HOWEVER, that, if the common stock of such Person is not at such
time and has not been continuously over the preceding 12-month period
registered under Section 12 of the Exchange Act or such Person is not a
corporation, then (A) if such Person is a direct or indirect Subsidiary of
one other Person which has common stock so registered, "Principal Party"
shall refer to such other Person, (B) if such Person is a direct or indirect
Subsidiary of another Person but is not a direct or indirect Subsidiary of
another Person which has common stock so registered, "Principal Party" shall
refer to the ultimate parent entity of such first-mentioned Person, (C) if
such Person is directly or indirectly controlled by more than one Person, and
one or more of such other persons has common stock so registered, "Principal
Party" shall refer to whichever of such Persons that is the issuer of common
stock so registered having the highest aggregate Current Per Share Market
Price (determined pursuant to Section 11(d)), and (D) if such Person is
directly or indirectly controlled by more than one Person, and none of such
other Persons have common stock so registered, "Principal Party" shall refer
to whichever ultimate parent entity is the corporation having the greatest
shareholders' equity or, if no such ultimate parent entity is a corporation,
shall refer to whichever ultimate parent entity is the entity having the
greatest net assets.
25
c. The Company shall not enter into any transaction described in
this Section 13 if at the time of such transaction there are any rights,
warrants, instruments or securities outstanding or any agreements or
arrangements which, as a result of the consummation of such transaction,
would eliminate or substantially diminish the benefits intended to be
afforded by the Rights. In addition, the Company shall not consummate any
such transaction unless the Principal Party shall have a sufficient number of
authorized shares of common stock 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 providing for the terms set forth in this Section 13 and further
providing that, as soon as practicable after execution of such agreement, the
Principal Party will
i. prepare and file a registration statement under the Act
with respect to the securities purchasable upon exercise of the Rights on
an appropriate form, and will use its best efforts to cause such
registration statement to (A) become effective as soon as practicable after
such filing, (B) remain effective (with a prospectus at all times meeting
the requirements of the Act) until the Final Expiration Date and, as soon
as practicable following the execution of such agreement, take such action
as may be required to ensure that any acquisition of such shares of common
stock upon the exercise of the Rights complies with any applicable state
security or "blue sky" laws; and
ii. will 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 under the
Exchange Act.
d. In case the Principal Party which is to be a party to a
transaction referred to in this Section 13 has a provision in any of its
authorized securities or in its Articles or Certificate of Incorporation or
Bylaws or other instrument governing its corporate affairs, which provision
would have the effect of (i) causing such Principal Party to issue, in
connection with, or as a consequence of, the consummation of a transaction
referred to in this Section 13, shares of common stock of such Principal
Party at less than the then Current Per Share Market Price (determined
pursuant to Section 11(d)) or securities exercisable for, or convertible
into, shares of common stock of such Principal Party at less than the then
Current Per Share Market Price (other than to holders of Rights pursuant to
this Section 13) or (ii) providing for any special payment, tax or similar
provisions in connection with the issuance of the shares of common stock of
such Principal Party pursuant to the provisions of Section 13; then, in such
event, the Company shall not consummate any such transaction unless prior
thereto the Company and such Principal Party shall have executed and
delivered to the Rights Agent a supplemental agreement providing that the
provision in question of such Principal Party shall have been canceled,
waived or amended, or that the authorized securities shall be redeemed, so
that the applicable provision will have no effect in connection with, or as a
consequence of, the consummation of the proposed transaction.
26
e. The provisions of this Section 13 shall similarly apply to
successive mergers or consolidations or sales or other transfers. In the
event that a Section 13 Event shall occur at any time after the Stock
Acquisition Date, the Rights which have not theretofore been exercised shall
thereafter become exercisable in the manner described in Section 13. The
provisions of Section 11(a)(ii) shall be of no effect following the first
occurrence of a Section 13 Event.
14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES.
a. The Company shall not be required to issue fractions of Rights
or to distribute Rights certificates which evidence fractional Rights. In
lieu of such fractional Rights, there shall be paid to the registered holders
of the Rights Certificates 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 for
any day shall be the last sale 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 or 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 selected by the
Board of Directors of the Company. 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 of Directors of the Company shall be
used.
b. The Company shall not be required to issue fractions of shares
of Preferred Stock (other than fractions which are integral multiples of one
one-thousandths of a share of Preferred Stock) upon exercise of the Rights or
to distribute certificates which evidence fractional shares of Preferred
Stock (other than fractions which are integral multiples of one
one-thousandths of a share of Preferred Stock). In lieu of fractional shares
of Preferred Stock that are not integral multiples of one one-thousandths of
a share of Preferred Stock the Company shall pay to the registered holders of
Rights Certificates at the time such Rights are exercised as herein provided
an amount in cash equal to the same fraction of the current market value of
one one-thousandth of a share of Preferred Stock. For purposes of this
Section 14(b), the current market value of one one-thousandth of a share of
Preferred Stock
27
shall be one one-thousandth of the closing price of a share of Preferred
Stock (as determined pursuant to Section 11(d)(ii) hereof) for the Trading
Day immediately prior to the date of such exercise.
c. Following the occurrence of a Stock Acquisition Date or
Section 13 Event, the Company shall not be required to issue fractions of
shares of Common Stock upon exercise of the Rights or to distribute
certificates which evidence fractional shares of Common Stock. In lieu of
fractional shares of Common Stock, the Company may pay to the registered
holders of Rights Certificates at the time such Rights are exercised as
herein provided an amount in cash equal to the same fraction of current
market value of one share of Common Stock. For purposes of this Section
14(c), the current market value of one share of Common Stock shall be the
closing price of one share of Common Stock (as determined pursuant to Section
11(d)(i) hereof) for the Trading Day immediately prior to the date of such
exercise.
d. The holder of a Right by the acceptance of the Right expressly
waives his right to receive any fractional Rights or any fractional shares
upon exercise of a Right (except as provided above).
e. The Rights Agent shall have no duty or obligation with respect
to this Section 14 or with respect to any other Section hereof regarding
fractional shares unless and until the Rights Agent shall have received
specific instructions (and sufficient cash, if required) from the Company
with respect to its duties and obligations under such Sections.
15. RIGHTS OF ACTION. All rights of action in respect of this
Agreement, excepting the rights of action given to the Rights Agent under
Section 18, are vested in the respective registered holders of the Rights
Certificates (and, prior to the Distribution Date, the registered holders of
the Common Stock); and any registered holder of any Right Certificate (or,
prior to the Distribution Date, of Common Stock), without the consent of the
Rights Agent or of the holder of any other Right Certificate (or, prior to
the Distribution Date, of Common Stock), may, in his own behalf and for his
own benefit, enforce, and may institute and maintain any suit, action or
proceeding against the Company to enforce, or otherwise act in respect of,
his right to exercise the Rights evidenced by such Rights Certificate in the
manner provided in such Rights 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 will be entitled
to specific performance of the obligations hereunder and injunctive relief
against actual or threatened violations of the obligations of any Person
subject to this Agreement.
16. AGREEMENT OF RIGHTS HOLDERS. Every holder of a Right, by accepting
the same, consents and agrees with the Company and the Rights Agent and with
every other holder of a Right that:
28
a. prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of the Common Stock;
b. after the Distribution Date, the Rights Certificates are
transferable only on the registry books of the Rights Agent if surrendered at
the office of the Rights Agent designated for such purpose, duly endorsed or
accompanied by a proper instrument of transfer and with the appropriate forms
and certificates fully executed;
c. subject to Sections 6 and 7(f), the Company and the Rights
Agent may deem and treat the Person in whose name the Rights Certificate (or,
prior to the Distribution Date, the associated Common Stock certificate) is
registered as the absolute owner thereof and of the Rights evidenced thereby
(notwithstanding any notations of ownership or writing on the Right
Certificates or the associated Common Stock certificate made by anyone other
than the Company or the Rights Agent) for all purposes whatsoever, and
neither the Company nor the Rights Agent, subject to the last sentence of
Section 7(e), 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, judgment, 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, judgment, decree or ruling lifted or otherwise overturned as soon as
possible.
17. RIGHTS CERTIFICATE HOLDER NOT DEEMED A SHAREHOLDER. No holder, as
such, of any Rights Certificate shall be entitled to vote, receive dividends
or be deemed for any purpose the holder of the number of one one-thousandths
of a share of Preferred Stock or any other securities of the Company which
may at any time be issuable on the exercise of the Rights represented
thereby, nor shall anything contained herein or in any Rights Certificate be
construed to confer upon the holder of any Rights 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 23(c)), or to receive dividends or subscription
rights, or otherwise, until the Rights evidenced by such Rights Certificate
shall have been exercised in accordance with the provisions hereof.
29
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 other disbursements incurred in the preparation, delivery,
administration, execution and any amendment 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, damage, judgment, fine, penalty, claim, demand, settlement, cost
or expense, incurred without gross negligence, bad faith or willful
misconduct on the part of the Rights Agent (each as may be finally determined
by a court of competent jurisdiction), for any action taken, suffered or
omitted by the Rights Agent in connection with the acceptance and
administration of this Agreement, including, without limitation, the costs
and expenses of defending against any claim of liability. The indemnity
provided herein shall survive the termination of this Agreement and the
termination and the expiration of the Rights. The costs and expenses
incurred by the Rights Agent in enforcing this right of indemnification shall
be paid by the Company.
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 acceptance and administration of this Agreement in
reliance upon any Rights Certificate or certificate for shares of Common
Stock or for other securities of the Company, 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, or otherwise upon
the advice of counsel as set forth in Section 20.
19. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF RIGHTS AGENT.
a. Any Person into which the Rights Agent or any successor Rights
Agent may be merged or with which it may be consolidated, or any Person
resulting from any merger or consolidation to which the Rights Agent or any
successor Rights Agent shall be a party, or any Person succeeding to the
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 that such Person would be eligible for appointment
as a successor Rights Agent under the provisions of Section 21. In case at
the time such successor Rights Agent shall succeed to the agency created by
this Agreement, any of the Rights Certificates shall have been countersigned
but not delivered, any such successor Rights Agent may adopt the
countersignature of the predecessor Rights Agent and deliver such Rights
Certificates so countersigned; and in case at that time any of the Rights
Certificates shall not have been countersigned, any successor Rights Agent
may countersign such Rights Certificates either in the name of the
predecessor Rights Agent or in the name of the successor Rights Agent; and in
30
all such cases such Rights Certificates shall have the full force provided in
the Rights Certificates and in this Agreement.
b. In case at any time the name of the Rights Agent shall be
changed and at such time any of the Rights Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the
countersignature under its prior name and deliver Rights Certificates so
countersigned; and in case at that time any of the Rights Certificates shall
not have been countersigned, the Rights Agent may countersign such Rights
Certificates either in its prior name or in its changed name; and in all such
cases such Rights Certificates shall have the full force provided in the
Rights Certificates and in this Agreement.
20. DUTIES OF RIGHTS AGENT. The Rights Agent undertakes only the
duties and obligations expressly imposed by this Agreement upon the following
terms and conditions, by all of which the Company and the holders of Rights
Certificates, by their acceptance thereof, shall be bound:
a. The Rights Agent may consult with legal counsel (who may be
legal counsel for the Company), and the advice or opinion of such counsel
shall be full and complete authorization and protection to the Rights Agent
for, and the Rights Agent shall incur no liability for in respect of, any
action taken, suffered or omitted by it in good faith and in accordance with
such advice or 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
be proved or established by the Company prior to taking, omitting to take or
suffering any action hereunder (including, without limitation, the identity
of any Acquiring Person and the determination of the Current Per Share Market
Price), such fact or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be conclusively provided and
established by a certificate signed by any one of the Chairman of the Board,
Chief Executive Officer, President, any Vice President, the Treasurer or the
Secretary of the Company and delivered to the Rights Agent; and such
certificate shall be full authorization and protection to the Rights Agent
for any action taken, omitted to be taken or suffered by it under the
provisions of this Agreement in reliance upon such certificate.
c. The Rights Agent shall be liable hereunder to the Company and
any other Person only for its own gross negligence, bad faith or willful
misconduct (each as may be finally determined by a court of competent
jurisdiction). Anything to the contrary notwithstanding, in no event shall
the Rights Agent be liable for special, punitive, indirect, consequential or
incidental loss or damage of any kind whatsoever (including but limited to
lost profits), even if the Rights Agent has been advised of the likelihood of
such loss or damage. Any liability of the Rights Agent under this Right
Agreement shall be limited to the amount of fees paid by the Company to the
Rights Agent.
31
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
Rights Certificates (except its countersignature thereof) or be required to
verify the same, 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 have any liability or 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 Rights 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
Rights Certificate; nor shall it be responsible for any change in the
exercisability of the Rights (including the Rights becoming null and void
pursuant to Section 7(e) hereof) or any adjustment in the terms of the Rights
(including the manner, method or amount thereof) provided for in this
Agreement or the ascertaining of the existence of facts that would require
any such change or adjustment (except with respect to the exercise of Rights
evidenced by Rights Certificates after actual notice that such change or
adjustment is required); nor shall it by any act hereunder be deemed to make
any representation or warranty as to the authorization or reservation of any
shares of Preferred Stock or Common Stock to be issued pursuant to this
Agreement or any Right Certificate or as to whether any shares of Preferred
Stock or Common Stock will, when 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 any
one of the Chairman of the Board, the Chief Executive Officer, the President,
any Vice President, the Secretary or 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, omitted to be taken
or suffered by it in accordance with instructions of any such officer or for
any delay in acting while waiting for those instructions. Any application by
the Agent for written instructions from the Company may, at the option of the
Rights Agent, set forth in writing any action proposed to be taken, omitted
to be taken or suffered by the Rights Agent under this Agreement and the date
on or after which such action shall be taken or suffered, or such omission
shall be effective. The Rights Agent shall not be liable for any action taken
or suffered by, or omission of, the Rights Agent in accordance with a
proposal included in any such application on or after the date specified in
such application (which date shall not be less than five Business Days after
the date any such officer of the Company actually receives such application,
unless any such officer shall have consented in writing to an earlier date)
unless, prior to taking any such action (or the effective dates in the case
of an omission), the Rights
32
Agent shall have received written instructions in response to such
application specifying the action to be taken, suffered or omitted.
h. The Rights Agent and any shareholder, affiliate, 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 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 or any other Person
resulting from any such act, default, neglect or misconduct, absent gross
negligence, bad faith or willful misconduct (each as may be finally
determined by a court of competent jurisdiction) in the selection and
continued employment thereof.
j. No provision of this Agreement shall require the Rights Agent
to expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder or in the exercise of its
rights believes that repayment of such funds or adequate indemnification
against such risk or liability is not reasonably assured to it.
k. If, with respect to any Rights Certificate surrendered to the
Rights Agent for exercise or transfer, the certificate attached to the form
of assignment or form of election to purchase, as the case may be, has either
not been completed or indicates an affirmative response to clause 1 and/or 2
thereof, the Rights Agent shall not take any, further action with respect to
such requested exercise or transfer without first consulting with the Company.
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
30 days' notice in writing mailed to the Company and to each transfer agent
of the Common Stock and Preferred Stock by registered or certified mail, and
to the holders of the Rights Certificates by first-class mail. The Company
may remove the Rights Agent or any successor Rights Agent upon 30 days'
notice in writing, mailed to the Rights Agent or successor Rights Agent, as
the case mast be, and to each transfer agent of the Common Stock and
Preferred Stock by registered or certified mail, and to the holders of the
Rights 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 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 Rights Certificate (who shall, with such notice, submit his Rights
Certificate for inspection by the Company), then the registered holder of any
Rights Certificate may apply
33
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 Person organized and doing business under the
laws of the United States or of any State of the United States, in good
standing, which is authorized under such laws to exercise corporate trust
powers 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 $50 million or (b) an
affiliate or subsidiary of a Person described in clause (a) of this sentence.
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 hereunder, 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 the Common Stock and Preferred Stock, and mail a notice thereof in writing
to the registered holders of the Rights 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.
22. ISSUANCE OF NEW RIGHTS CERTIFICATES. Notwithstanding any of the
provisions of this Agreement or of the Rights to the contrary, the Company
may, at its option, issue new Rights Certificates evidencing Rights in such
form as may be approved by its Board of Directors to reflect any adjustment
or change in the Purchase Price and the number or kind or class of shares or
other securities or property purchasable under the Rights Certificates made
in accordance with the provisions of this Agreement. In addition, in
connection with the issuance or sale of Common Stock of the Company following
the Distribution Date and prior to the Final Expiration Date, the Company (a)
shall, with respect to Common Stock of the Company so issued or sold pursuant
to the exercise of stock options or under any employee plan or arrangement,
or upon the exercise, conversion or exchange of securities issued by the
Company prior to the Distribution Date, and (b) may, in any other case, if
deemed necessary or appropriate by the Board of Directors, issue Rights
Certificates representing the appropriate number of Rights in connection with
such issuance or sale; PROVIDED, HOWEVER, that (i) no such Rights 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 Rights
Certificate would be issued, and (ii) no such Rights Certificate shall be
issued if, and to the extent that, appropriate adjustment shall otherwise
have been made in lieu of the issuance thereof.
23. REDEMPTION.
a. The Board of Directors of the Company may at its option, at
any time prior to the earlier of (i) a Stock Acquisition Date or (ii) the
Close of Business on the Final Expiration Date, redeem all but not less than
all the then outstanding Rights at a redemption
34
price of $.001 per Right, 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 as provided in Section 11(a)(ii) until such
time as the Company's right of redemption hereunder has expired.
b. Immediately upon the action of the Board of Directors of the
Company ordering the redemption of the Rights (or at such later time as shall
be specified, in the resolution taking such action), and 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. Promptly after the action of the Board of
Directors ordering the redemption of the Rights, the Company shall give
notice of such redemption to the holders of the then outstanding Rights and
the Rights Agent by mailing such notice to all such holders at their last
addresses as they appear upon the registry books of the Rights Agent or,
prior to the Distribution Date, on the registry books of the transfer agent
for the shares of Common Stock. 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. The Company may, at its
option, pay the Redemption Price in cash, shares of Common Stock (based on
the Current Per Share Market Price, as defined in Section 11(d), of the
Common Stock at the time of redemption) or any other form of consideration
deemed appropriate by the Board of Directors.
c. In case the Company shall propose (a) to pay any dividend
payable in stock of any class to the holders of its Preferred Stock or Common
Stock or to make any other distribution to the holders of its Preferred Stock
or Common Stock (other than a regular quarterly cash dividend), (b) to offer
to the holders of its Preferred Stock or Common Stock rights or warrants to
subscribe for or to purchase any additional shares of Preferred Stock or
Common Stock or shares of stock of any class or any other securities, (c) to
effect any reclassification of its Preferred Stock or Common Stock (other
than a reclassification involving only the subdivision of outstanding shares
of Preferred Stock or Common Stock), (d) to effect any consolidation, merger
or share exchange into or with any other Person (other than a Subsidiary of
the Company in a transaction which complies with Section 11(m)), (e) to
effect any sale or other transfer or to permit one or more of its
Subsidiaries to effect any sale or other transfer, in one or more related
transactions, of 50 percent or more of the assets or earning power of the
Company and its Subsidiaries (taken as a whole) to any other Person (other
than the Company and/or any of its Subsidiaries in one or more transactions
each of which complies with Section 11(m)), or (f) 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 Rights Certificate, to the extent
feasible and in accordance with Section 25, a notice of such proposed action,
which shall specify the record date for the purposes of such stock dividend
or distribution of rights or warrants, or the date on which such
reclassification, consolidation, merger, exchange, sale, transfer,
liquidation, dissolution, or winding up is to take place and
35
the date of participation therein by the holders of the Preferred Stock or
Common Stock if any such date is to be fixed, and such notice shall be so
given in the case of any action covered by clause (a) or (b) above at least
20 days prior to the record date for determining holders of the Preferred
Stock or Common Stock for purposes of such action, and in the case of any
such other action, at least 20 days prior to the date of the taking of such
proposed action or the date of participation therein by the holders of the
Preferred Stock or Common Stock whichever shall be the earlier.
In case a Stock Acquisition Date shall occur, the Company shall as
soon as practicable thereafter give to the Rights Agent and to each holder of
a Rights Certificate, in accordance with Section 25, a notice of the
occurrence of such event, which shall specify the event and the consequences
of the event to holders of Rights under section 11(a)(ii).
24. EXCHANGE.
a. The Board of Directors of the Company may, at its option, at
any time and from time to time after a Stock Acquisition Date, exchange all
or part of the then outstanding and exercisable Rights (which shall not
include Rights that have become null and void pursuant to the provisions of
Section 7(e)) for shares of Common Stock or Common Stock Equivalents, or any
combination thereof, at an exchange ratio of one share of Common Stock, or
such number of Common Stock Equivalents or units representing fractions
thereof as would be deemed to have the same value as one share of Common
Stock, per Right, appropriately adjusted to reflect any stock split, stock
dividend or similar transaction occurring after the date hereof (such
exchange ratio being hereinafter referred to as the "Exchange Ratio").
b. Immediately upon the action of the Board of Directors of the
Company ordering the exchange of any Rights pursuant to subSection (a) of
this Section 24 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 shares of
Common Stock and/or Common Stock Equivalents equal to the number of such
Rights held by such holder multiplied by the Exchange Ratio. The Company
shall promptly give public notice of any such exchange (with prompt notice
thereof to the Rights Agent); 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 the Rights
Agent and 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 which is
mailed in the manner herein provided shall be deemed given, whether or not
the holder receives the notice. Each such notice of exchange will state the
method by which the exchange of the shares of Common Stock and/or Common
Stock Equivalents for Rights will be effected and, in the event of any
partial exchange, the number of Rights which will be exchanged. Any partial
exchange shall be effected pro rata based on the number of Rights (other than
Rights which have become null and void pursuant to the provisions of Section
7(e)) held by each holder of Rights.
36
c. In the event that the number of shares of Common Stock which
are authorized by the Company's Restated Articles of Incorporation but not
outstanding or reserved for issuance for purposes other than upon exercise of
the Rights are not sufficient to permit an exchange of Rights as contemplated
in accordance with this Section 24, the Company shall either take such action
as may be necessary to authorize additional Common Stock for issuance upon
exchange of the Rights or alternatively, at the option of a majority of the
Board of Directors, with respect to each Right (i) pay cash in an amount
equal to the Current Value (as hereinafter defined), in lieu of issuing
Common Stock in exchange therefor, or (ii) issue debt of equity securities or
a combination thereof, having a value equal to the Current Value, in lieu of
issuing Common Stock in exchange for each such Right, where the value of such
securities shall be determined by a nationally recognized investment banking
firm selected by majority vote of the Board of Directors, or (iii) deliver
any combination of cash, property, Common Stock and/or other securities
having a value equal to the Current Value in exchange for each Right. For
purposes of this Section 24(c), the Current Value shall mean the product of
the Current Per Share Market Price of Common Stock on the date of the
occurrence of the event described above in subparagraph (a), multiplied by
the number of Common Stock for which the Right otherwise would be
exchangeable if there were sufficient shares available. To the extent that
the Company determines that some action need be taken pursuant to clauses
(i), (ii) or (iii) of this Section 24(c), the Board of Directors may
temporarily suspend the exercisability of the Rights for a period of up to
sixty (60) days following the date on which the event described in this
Section 24(a) shall have occurred, in order to seek any authorization of
additional Common Stock and/or to decide the appropriate form of distribution
to be made pursuant to the above provision and to determine the value
thereof. In the event of any such suspension, the Company shall issue a
public announcement (with prompt notice thereof to the Rights Agent) stating
that the exercisability of the Rights has been temporarily suspended.
d. The Company shall not be required to issue fractions of shares
of Common Stock or to distribute certificates which evidence fractional
shares of Common Stock. In lieu of such fractional shares of Common Stock,
the Company shall pay to the registered holders of Rights with regard to
which such fractional shares of Common Stock would otherwise be issuable an
amount in cash equal to the same fraction of the value of a whole share of
Common Stock. For purposes of this Section 24, the value of a whole share
of Common Stock shall be the closing price (as determined pursuant to the
second sentence of Section 11(d)(i)) for the Trading Day immediately prior to
the date of exchange pursuant to this Section 24, and the value of any Common
Stock Equivalent shall be deemed to have the same value as the Common Stock
on such date.
e. The Company may, at its option, by majority vote of the Board
of Directors, at any time before any Person has become an Acquiring Person,
exchange all or part of the then outstanding Rights for rights of
substantially equivalent value, as determined
37
reasonably and with good faith by the Board of Directors based upon the
advice or one or more nationally recognized investment banking firms.
f. Immediately upon the action of the Board of Directors ordering
the exchange of any Rights pursuant to subsection 24(e) of this Section 24
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 rights in exchange therefor as has
been determined by the Board of Directors in accordance with subsection 24(e)
above. The Company shall 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 shall mail a notice of any
such exchange to all of the holders of such Rights at their last address as
they appear upon the registry books of the transfer agent for the Common
Stock of the Company. Any notice which is mailed in the manner herein
provided shall be deemed given, whether or not the holder receives such
notice. Each such notice of exchange will state the method by which the
exchange of the Rights will be effected.
25. NOTICES. Notices or demands authorized by this Agreement to be
given or made by the Rights Agent or by the holder of any Rights Certificate
to or on the Company shall be in writing and shall be deemed given if
delivered personally or by commercial delivery service, or mailed by
registered or certified mail (return receipt requested) or sent via facsimile
(with acknowledgment of a complete transmission), addressed (until another
address is filed in writing with the Rights Agent) as follows:
TEKTRONIX, INC.
00000 XX Xxxx Xxxxx Xxxxx
Xxxxxxxxx, Xxxxxx 00000
Attention: General Counsel
Fax No.: (000) 000-0000
With a copy to:
Stoel Rives LLP
000 XX Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx
Fax No.: (000) 000-0000
Subject to the provisions of Section 21, any notice or demand authorized by
this Agreement to be given or made by the Company or by the holder of any
Rights Certificate to or on the Rights Agent shall be in writing and shall be
deemed given if delivered personally or by commercial delivery service, or
mailed by registered or certified mail (return receipt requested) or sent via
facsimile (with acknowledgment of a complete transmission) addressed (until
another address is filed in writing with the Company) as follows:
38
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Relationship Manager
Fax No.: (000) 000-0000
With a copy to:
Xxxxx Xxxxxx Shareholder Services, L.L.C.
00 Xxxxxxxxxx Xxxx
Xxxxxxxxxx Xxxx, X.X. 00000
Attention: General Counsel
Fax No.: (000) 000-0000
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Rights Certificate 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.
26. SUPPLEMENTS AND AMENDMENTS. Prior to the Distribution Date, the
Company may supplement or amend any provision of this Agreement without the
approval of any holders of certificates representing shares of Common Stock
and the Rights Agent shall, if the Company so directs and at the expense of
the Company and subject to the penultimate sentence of this section, execute
such supplement or amendment. From and after the Distribution Date, the
Company and the Rights Agent may supplement or amend this Agreement without
the approval of any holders 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 the provisions hereunder in any manner which the Company may deem
necessary or desirable and which shall not adversely affect the interest of
the holders of Rights Certificates (other than an Acquiring Person or an
Affiliate or Associate of any such Person); PROVIDED, HOWEVER, this Agreement
may not be supplemented or amended to lengthen, pursuant to clause (iii) of
this sentence, (A) a time period relating to when the Rights may be redeemed
at such time as the Rights are not then redeemable, or (B) 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 of an Acquiring
Person). 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 and provided that such amendment
or supplement does not change or increase the Rights Agent's duties,
liabilities or obligations, the Rights Agent shall execute such supplement or
amendment. Prior to Distribution Date, the interests
39
of the holders of Rights shall be deemed coincident with the interests of the
holders of shares of Common Stock.
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.
28. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall be
construed to give to any person or corporation other than the Company, the
Rights Agent and the registered holders of the Rights Certificates (and,
prior to the Distribution Date, the Common Stock) any legal or equitable
right, remedy or claim under this Agreement; but this Agreement shall be for
the sole and exclusive benefit of the Company, the Rights Agent and the
registered holders of the Rights Certificates (and, prior to the Distribution
Date, the Common Stock).
29. 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, 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 and
any invalid or unenforceable provision shall be modified to the extent
necessary to allow for enforceability and to give effect to the original
intent of the parties to the extend possible; 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
invalid, void or unenforceable and the Board of Directors of the Company
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(a) shall be
reinstated and shall not expire until the Close of Business on the tenth day
following the date of such determination by the Board of Directors of the
Company.
30. DETERMINATIONS AND ACTIONS BY THE BOARD OF DIRECTORS, ETC. For all
purposes of this Agreement, any calculation of the number of shares of Common
Stock outstanding at any particular time, including for purposes of
determining the particular percentage of such outstanding Common Stock 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 of Directors of the Company shall have the
exclusive power and authority to administer this Agreement and to exercise
all rights and powers specifically granted to the Board of Directors of the
Company or to the Company, 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. All such actions, calculations, interpretations and
determinations (including, for purposes of clause (b) below, all omissions
with respect to the foregoing) which are done or made by the Board of
Directors of the Company in good faith, shall (a) be final, conclusive and
binding on the Company, the Rights Agent, the holders of the Rights and all
other parties, and (b) not
40
subject the Board of Directors of the Company to any liability to the holders
of the Rights. The Rights Agent shall always be entitled to assume that the
Company's Board of Directors acted in good faith and shall be fully protected
and shall incur no liability in reliance thereon.
31. GOVERNING LAW. This Agreement and each Rights certificate issued
hereunder shall be deemed to be a contract made under the laws of the State
of Oregon 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; provided, however, that all provisions
regarding the rights, duties and obligations of the Rights Agent shall be
governed by and construed in accordance with the laws of the State of New
York applicable to contracts made and to be performed entirely within such
State.
32. 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.
33. 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.
41
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed and attested, all as of the day and year first above
written.
TEKTRONIX, INC.
By: /s/ X.X. XXXXX
---------------------------
Name: X.X. Xxxxx
Title: Vice President & Chief Financial Officer
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
By: /s/ XXXXXX XXXXXXXX
---------------------------
Name: Xxxxxx Xxxxxxxx
Title: Assistant Vice President
EXHIBIT A
FORM OF AMENDMENT TO RESTATED
ARTICLES OF INCORPORATION
OF
TEKTRONIX, INC.
ESTABLISHING
SERIES B NO PAR PREFERRED SHARES
ARTICLE XIV
This Article XIV sets forth, the designation, preferences,
limitations and relative rights of a series of No Par Preferred Shares of the
corporation as determined by the board of directors of the corporation
pursuant to its authority under Oregon Revised Statutes 60.134 and Section 3
of Article III of these Restated Articles of Incorporation.
1. DESIGNATION AND AMOUNT. The shares of such series shall be
designated as "Series B No Par Preferred Shares" and the number of shares
constituting such series shall be 125,000.
2. DIVIDENDS AND DISTRIBUTIONS.
(i) The holders of shares of Series B No Par Preferred
Shares shall be entitled to receive, when and as declared by the board of
directors, out of funds legally available for the purpose, dividends in an
amount per share equal to 1,000 (the "Adjustment Number") multiplied by the
aggregate per share amount of all cash dividends, and the Adjustment Number
multiplied by the aggregate per share amount (payable in kind) of all
non-cash dividends or other distributions other than a dividend payable in
Common Shares or a subdivision of the outstanding Common Shares (by
reclassification or otherwise), declared on the Common Shares, without par
value, of the corporation (the "Common Shares") after the first issuance of
any share or fraction of a share of Series B No Par Preferred Shares.
(ii) The corporation shall declare a dividend or distribution
on the Series B No Par Preferred Shares as provided in subparagraph 2 (i) at
the same time that it declares a dividend or distribution on the Common
Shares (other than a dividend payable in Common Shares).
(iii) Dividends shall not be cumulative. Unpaid dividends
shall not bear interest. Dividends paid on the Series B No Par Preferred
Shares in an amount less than the total amount of such dividends at the time
accrued and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time outstanding.
A-1
3. VOTING RIGHTS. The holders of Series B No Par Preferred
Shares shall have the following voting rights:
(i) Each Series B No Par Preferred Share shall entitle the
holder thereof to the number of votes equal to the Adjustment Number then in
effect on all matters submitted to a vote of the shareholders of the
corporation.
(ii) Except as otherwise provided herein or by law, the
holders of Series B No Par Preferred Shares and the holders of common shares
shall vote together as one class on all matters submitted to a vote of
shareholders of the corporation.
4. CERTAIN RESTRICTIONS.
(i) Whenever dividends or distributions payable on the
Series B No Par Preferred Shares as provided in Section 2 have not been
declared or paid for any fiscal year, until all such dividends and
distributions for such fiscal year on Series B No Par Preferred Shares
outstanding shall have been declared and paid in full, the corporation shall
not in such fiscal year
(a) declare or pay dividends on or make any other
distributions on any shares of stock ranking junior or on a parity (either
as to dividends or upon liquidation, dissolution or winding up) to the
Series B No Par Preferred shares except dividends paid ratably on the
Series B No Par Preferred Shares and all such parity stock on which
dividends are payable in proportion to the total amounts to which the
holders of all such shares are then entitled and dividends or distributions
payable in Common Shares;
(b) purchase or otherwise acquire for consideration any
Series B No Par Preferred Shares or any shares of stock ranking on a parity
with the Series B No Par Preferred Shares, except in accordance with a
purchase offer made in writing or by publication (as determined by the
board of directors) to all holders of such shares upon such terms as the
board of directors, after consideration of the respective dividend rates
and other relative rights and preferences of the respective series and
classes, shall determine in good faith will result in fair and equitable
treatment among the respective series or classes.
(ii) The corporation shall not permit any subsidiary of the
corporation to purchase or otherwise acquire for consideration any shares of
stock of the corporation unless the corporation could, under subparagraph
4(i), purchase or otherwise acquire such shares at such time and in such
manner.
5. RESTRICTION ON ISSUANCE OF SHARES; REACQUIRED SHARES. The
corporation shall not issue any Series B No Par Preferred Shares except upon
exercise of rights (the
A-2
"Rights") issued pursuant to the Rights Agreement dated as of June 21, 2000,
between the corporation and ChaseMellon Shareholder Services, L.L.C., (the
"Rights Agreement"), a copy of which is on file with the secretary of the
corporation at its principal executive office and shall be made available to
shareholders of record without charge upon written request. Any Series B No
Par Preferred Shares purchased or otherwise acquired by the corporation in
any manner whatsoever may be restored to the status of authorized but
unissued shares after, the acquisition thereof. All such shares shall upon
any such restoration become authorized but unissued shares of Preferred
Shares and may be reissued as part of a new series of Preferred Shares to be
created by the board of directors, subject to the conditions and restrictions
on issuance set forth herein.
6. LIQUIDATION, DISSOLUTION OR WINDING UP.
(i) Upon any liquidation (voluntary or otherwise),
dissolution or winding up of the corporation, no distribution shall be made
to the holders of shares of stock ranking junior (either as to dividends or
upon liquidation, dissolution or winding up) to the Series B No Par Preferred
Shares unless, prior thereto, the holders of shares of Series B No Par
Preferred Shares shall have received the Adjustment Number multiplied by the
per share amount to be distributed to holders of Common Shares, plus an
amount equal to declared and unpaid dividends and distributions thereon to
the date of such payment (the "Series B Liquidation Preference"). Following
the payment of the full amount of the Series B Liquidation Preference, no
additional distributions shall be made to the holders of shares of Series B
No Par Preferred Shares.
(ii) In the event that there are not sufficient assets
available to permit payment in full of the Series B Liquidation Preference
and the liquidation preferences of all other series of Preferred Shares, if
any, which rank senior to or on a parity with the Series B No Par Preferred
shares, then assets shall be distributed first to holders of any series of
Preferred Shares ranking senior to the Series B No Par Preferred Shares to
the extent of their liquidation preferences and such remaining assets shall
be distributed ratably to the holders of Series B No Par Preferred Shares and
such parity shares in proportion to their respective liquidation preferences.
7. CONSOLIDATION, MERGER, ETC. In case the corporation shall
enter into any consolidation, merger, combination or other transaction in
which the Common Shares are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case the Series
B No Par Preferred Shares shall at the same time be similarly exchanged or
changed in an amount per share equal to the Adjustment Number multiplied by
the aggregate amount of stock, securities, cash and/or any other property
(payable in kind), as the case may be, into which or for which each Common
Share is changed or exchanged.
8. ANTI-DILUTION, ADJUSTMENTS TO ADJUSTMENT NUMBER. In the event
the corporation shall at any time after September 7, 2000 (the "Rights
Declaration Date")
A-3
(i) declare any dividend on Common Shares payable in shares of Common Shares,
(ii) subdivide the outstanding Common Shares, or (iii) combine the
outstanding Common Shares into a smaller number of shares, then in each such
case the Adjustment Number for all purpose of this Article XIV shall be
adjusted by multiplying the Adjustment Number then in effect by a fraction,
the numerator of which is the number of Common Shares outstanding immediately
after such event and the denominator of which is the number of Common Shares
that were outstanding immediately prior to such event. In the event the
corporation shall at any time after the Rights Declaration Date, fix a record
date for the issuance of rights, options or warrants to all holders of Common
Shares entitling them (for a period expiring within 45 calendar days after
such record date) to subscribe for or purchase Common Shares or securities
convertible into Common Shares at a price per Common Shares (or having a
conversion price per share, if a security convertible into Common Shares)
less than the then Current Per Share Market Price (as defined in Section
11(d) of the Rights Agreement) of the Common Shares on such record date, then
in each such case the Adjustment Number for all purposes of this Article XIV
shall be adjusted by multiplying the Adjustment Number then in effect by a
fraction, the numerator of which shall be the number of Common Shares
outstanding on such record date plus the, number of additional Common Shares
to be offered for subscription or purchase (or into which the convertible
securities so to be offered are initially convertible) and the denominator of
which shall be the number of common Shares outstanding on such record date
plus the number of shares of Common Stock which the aggregate offering price
of the total number of common Shares so to be offered (and/or the aggregate
initial conversion price of the convertible securities so to be offered)
would purchase at such Current Per Share Market Price (as defined in Section
11(d) of the Rights Agreement). In case such subscription price may be paid
in a consideration part or all of which shall be in a form other than cash,
the value of such consideration shall be as determined in good faith by the
board of directors. Common Shares owned by or held for the account of the
corporation shall, not be deemed outstanding for the purpose of any such
computation. Such adjustment shall be made successively whenever such a
record date is fixed. In the event that such rights, options or warrants are
not so issued, the Adjustment Number shall be readjusted as if such record
date had not been fixed; and to the extent such rights, options or warrants
are issued but not exercised prior to their expiration, the Adjustment Number
shall be readjusted to be the number which would have resulted from the
adjustment provided for in this paragraph 8 if only the rights, options or
warrants that were exercised had been issued.
9. NO REDEMPTION. The Series B No Par Preferred Shares shall not
be redeemable at the option of the corporation or any holder thereof.
Notwithstanding the foregoing sentence, the corporation may acquire Series B
No Par Preferred Shares in any other manner permitted by law.
10. AMENDMENT. Subsequent to the Distribution Date (as defined in
the Rights Agreement) these articles of incorporation shall not be further
amended in any manner which, would materially alter or change the
preferences, limitations and relative rights of the Series B No Par Preferred
Shares so as to affect them adversely without the affirmative vote of
A-4
the holders of a majority of the outstanding Series B No Par Preferred
Shares, voting separately as a class.
11. FRACTIONAL SHARES. Series B No Par Preferred Shares may be
issued in fractions of a share in integral multiples of one one-thousandth of
a share, which shall entitle the holder, in proportion to such holders'
fractional shares, to exercise voting rights, receive dividends, participate
in distributions and to have the benefit of all other rights of holders of
Series B No Par Preferred Shares.
A-5
EXHIBIT B
[Form of Rights Certificate]
Certificate No. R- ________ Rights
NOT EXERCISABLE AFTER SEPTEMBER 7, 2010 OR EARLIER IF REDEEMED BY THE
COMPANY. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE
COMPANY, AT $0.001 PER RIGHT ON THE TERMS SET FORTH IN THE RIGHTS
AGREEMENT. UNDER CERTAIN CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY
ACQUIRING PERSONS OR THEIR RESPECTIVE AFFILIATES OR ASSOCIATES (AS
SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) AND ANY RIGHTS
PREVIOUSLY OWNED BY SUCH PERSONS MAY BECOME NULL AND VOID. [THE
RIGHTS REPRESENTED BY THIS RIGHTS CERTIFICATE ARE OR WERE BENEFICIALLY
OWNED BY A PERSON WHO WAS AN ACQUIRING PERSON OR AN AFFILIATE OR
ASSOCIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE
RIGHTS AGREEMENT). ACCORDINGLY, THIS RIGHTS CERTIFICATE AND THE
RIGHTS REPRESENTED HEREBY MAY BECOME NULL AND VOID IN THE
CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF THE RIGHTS AGREEMENT.)(1)
Rights Certificate
______________________
This certifies that _______________________, or registered assigns,
is the registered owner of the number of Rights set forth above, each of
which entitles the owner thereof, subject to the terms, provisions and
conditions of the Rights Agreement dated as of June 21, 2000 (the "Rights
Agreement") between TEKTRONIX, INC., an Oregon corporation (the "Company"),
and CHASEMELLON SHAREHOLDER SERVICES, L.L.C. (the "Rights Agent"), to
purchase from the Company at any time prior to 5 p.m., State of Washington
time, on September 7, 2010 (the "Final Expiration Date") at the office or
offices of the Rights Agent designated for such purpose, one one-thousandth
of a fully paid and nonassessable share of Series B No Par Preferred Shares
(the "Preferred Stock") of the Company, at a purchase price of $375.00 (the
"Purchase Price"), upon presentation and surrender of this Rights Certificate
with the Form of Election to Purchase and related Certificate duly executed.
The Purchase Price may be paid in cash or by certified check or cashier's
check payable to the order of the Company. The number of Rights evidenced by
this Rights Certificate, the number of one one-thousandths of a share of
Preferred Stock which may be purchased upon exercise hereof, and the Purchase
Price per Right set forth, above are the number of Rights, the number of one
one-thousandths of a share and the Purchase Price as of September 7, 2000,
based on the Preferred Stock and Common Stock as constituted at such date.
__________________
(1) The portion of the legend in brackets shall be inserted only if
applicable and shall replace the preceding sentence.
B-1
Upon the occurrence of a Stock Acquisition Date (as such term is
defined in the Rights Agreement), if the Rights evidenced by this Rights
Certificate are beneficially owned by (i) an Acquiring Person or any
Affiliate or Associate of such Acquiring Person (as such terms are defined in
the Rights Agreement), (ii) any other person if such Rights formerly were
beneficially owned by such Acquiring Person (or by an Associate or Affiliate
thereof) at a time after such Acquiring Person became an Acquiring Person, or
(iii) under certain circumstances specified in the Rights Agreement, a
transferee of Rights from such Acquiring Person (or from any Associate or
Affiliate thereof) who became a transferee prior to or concurrently with such
Acquiring Person becoming an Acquiring Person, 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 an event.
As provided in the Rights Agreement, the Purchase Price and the
number and kind of shares of Preferred Stock or other securities or property
which may be obtained upon the exercise of the Rights evidenced by this
Rights Certificate are subject to modification and adjustment upon the
happening of certain events, including a Stock Acquisition Date or a Section
13 Event (as such terms are defined in the Rights Agreement).
This Rights Certificate is subject to all of the terms, provisions,
and conditions of the Rights Agreement, which terms, provisions, 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 and the limitations on the rights, obligations, duties, and
immunities hereunder of the Rights Agent, the Company, and the holders of the
Rights Certificates, which limitations of rights include the temporary
suspension of the exercisability of such Rights under the specific
circumstances set forth in the Rights Agreement. Copies of the Rights
Agreement are on file at the above-mentioned office of the Rights Agent and
are also available upon written request to the Rights Agent.
This Rights Certificate, with or without other Rights Certificates,
upon surrender at the office or offices of the Rights Agent designated for
such purpose, may be exchanged for another Rights Certificate or Rights
Certificates of like tenor and date evidencing Rights entitling the holder to
purchase a like aggregate number of one one-thousandths of a share of
Preferred Stock as the Rights evidenced by the Rights Certificate or Rights
Certificates surrendered shall have entitled such holder to purchase. If
this Rights Certificate shall be exercised in part, the holder shall be
entitled to receive upon surrender hereof another Rights certificate or
Rights 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 at its option at
a redemption prices of $.001 per Right at any time prior to the earlier of
(i) the Stock Acquisition Date or (ii) the Close of Business on the Final
Expiration Date.
B-2
No fractional shares of Preferred Stock will be issued upon the
exercise of any Right or Rights evidenced hereby (other than fractions which
are integral multiples of one one-thousandth of a share of Preferred Stock,
which may, at the election of the Company be evidenced by depository
receipts), but in lieu thereof a cash payment will be made as provided in the
Rights Agreement.
No holder of this Rights Certificate, as such, shall be entitled to
vote, receive dividends, or be deemed for any purpose the holder of shares of
Preferred Stock or of any other securities of the Company 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 Right or Rights evidenced by
this Rights Certificate shall have been exercised as provided in the Rights
Agreement.
This Rights 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: TEKTRONIX, INC.
____________________________ ______________________________
Secretary Title:________________________
Countersigned:
By__________________________
Authorized Signature
B-3
[Form of Reverse Side of Rights Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such holder desires to transfer
the Rights Certificate.)
FOR VALUE RECEIVED _____________________________ hereby sells,
assigns, and transfers unto____________________________________________________
_______________________________________________________________________________
(Please print name and address of transferee)
_______________________________________________________________________________
this Rights 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 Guaranteed:
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) this Rights 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 an Acquiring Person (as such terms are
defined in the Rights Agreement);
(2) after due inquiry and to the best knowledge of the
undersigned, it did did not acquire the Rights evidenced by this Rights
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 Guaranteed:
B-4
NOTICE
The signatures to the foregoing Assignment and Certificate must
correspond to the name as written upon the face of this Rights Certificate in
every particular, without alteration or enlargement or any change whatsoever.
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise Rights represented by the
Rights Certificate.)
TO:__________________
The undersigned hereby irrevocably elects to exercise ______________
_______________ Rights represented by this Rights Certificate to purchase the
shares of Preferred Stock issuable upon the exercise of the Rights (or such
other securities of the Company or of any other person which may be issuable
upon the exercise of the Rights) and requests that certificates for such
shares 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 Rights Certificate, a new Rights 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 ___________, 20____. ____________________________
Signature
Signature Guaranteed:
B-5
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) the Rights evidenced by this Rights Certificate / / are / / are
not being exercised by or on behalf of a Person who is or was an Acquiring
Person or an Affiliate or Associate of an Acquiring Person (as such terms are
defined pursuant to the Rights Agreement);
(2) after due inquiry and to the best knowledge of the
undersigned, it / / did / / did not acquire the Rights evidenced by this Rights
Certificate from any Person who is, was, or became an Acquiring Person or an
Affiliate or Associate of an Acquiring Person.
Dated ___________, 20____. ____________________________
Signature
Signature Guaranteed:
B-6
EXHIBIT C
SUMMARY OF RIGHTS TO PURCHASE
PREFERRED STOCK
On June 21, 2000, the Board of Directors of Tektronix, Inc. (the
"Company") declared a dividend of one Right for each outstanding Common Share
of the Company to shareholders of record at the Close of Business on
September 7, 2000. Each Right entitles the registered holder to purchase
from the Company one one-thousandth of a share of Series B No Par Preferred
Shares (the "Preferred Stock") at a Purchase Price of $375.00, subject to
adjustment. The description and terms of the Rights are set forth in a
Rights Agreement (the "Rights Agreement") between the Company and ChaseMellon
Shareholder Services, L.L.C., as Rights Agent.
Initially, the Rights will he attached to the certificates
representing outstanding Common Stock, and no separate Rights Certificates
will be distributed. The Rights will separate from the Common Stock and a
Distribution Date will occur upon the earlier of (i) ten days following a
public announcement that a person or group of affiliated or associated
persons has acquired, or obtained the right to acquire from shareholders,
beneficial ownership of 15 percent or more of the outstanding Common Stock or
(ii) ten days following the commencement of a tender offer or exchange offer
that would result in a person or group beneficially owning 15 percent or more
of such outstanding Common Stock, as such periods may be extended pursuant to
the Rights Agreement.
Until the Distribution Date, (i) the Rights will be evidenced by
and will be transferred with and only with such Common Stock certificates,
(ii) new Common Stock certificates issued after September 7, 2000 will
contain a legend incorporating the Rights Agreement by reference, and (iii)
the surrender for transfer of any certificates for Common Stock will also
constitute the transfer of the Rights associated with the Common Stock
represented by such certificate.
The Rights are not exercisable until the Distribution Date and will
expire at the Close of Business on September 7, 2010, unless earlier redeemed
by the Company as described below.
As soon as practicable after the Distribution Date, Rights
Certificates will be mailed to holders of record of the Common Stock as of
the Close of Business on the Distribution Date, and thereafter, the separate
Rights Certificates alone will represent the Rights. Except as otherwise
determined by the Board of Directors, only Common Stock issued prior to the
time the Rights become exercisable or issued upon exercise or conversion of
rights, warrants, options or convertible securities issued prior to the time
the Rights become exercisable will be issued with Rights.
C-1
In the event that any person becomes an Acquiring Person, each
holder of a Right shall thereafter have the right to receive, upon exercise,
in lieu of Preferred Stock, Common Stock of the Company (or, in certain
circumstances, cash, property or other securities of the Company) having a
value equal to two times the exercise price of the Right. However, rights
are not exercisable as described in this paragraph until such time as the
Rights are no longer redeemable by the Company as set forth below.
Notwithstanding any of the foregoing, if any person becomes an Acquiring
Person all Rights that are, or (under certain circumstances specified in the
Rights Agreement) were, beneficially owned by an Acquiring Person will become
null and void.
For example, at an exercise price of $375.00 per Right, each Right
not owned by the Acquiring Person (or by certain related parties or
transferees) following the event set forth in the preceding paragraph would
entitle its holder to purchase $750.00 worth of Common Stock (or other
consideration, as noted above) for $375.00. Assuming that the Common Stock
had a per share value of $75.00 at such time, the holder of each valid Right
would be entitled to purchase ten shares of Common Stock for $375.00.
In the event that, at any time following the Distribution Date, (i)
the Company is acquired in a merger or other business combination transaction
in which the Company is not the surviving corporation or in which the Common
Stock is exchanged for stock or other securities or property, or (ii) 50
percent or more of the Company's assets or earning power is sold or
transferred, each holder of a Right (except Rights which previously have been
voided as set forth above) shall thereafter have the right to receive, upon
exercise, common stock of the acquiring company having a value equal to two
times the exercise price of the Right.
The Purchase Price payable, and the number of one one-thousandths
of a share of Preferred Stock or other securities or property issuable upon
exercise of the Rights 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 Preferred Stock or the Common Stock,
(ii) if holders of the Preferred Stock are granted certain rights or warrants
to subscribe for Preferred Stock or convertible securities at less than the
current market price of the Preferred Stock, (iii) if holders of Common Stock
are granted certain rights or warrants to subscribe for Common Stock or
convertible securities at less than the current market price of the Common
Stock, or (iv) upon the distribution to holders of Preferred Stock or Common
Stock of evidences of indebtedness or assets (excluding regular quarterly
cash dividends) or of subscription rights or warrants (other than those
referred to above).
With certain exceptions, no adjustment in the Purchase Price or the
number of shares of Preferred Stock issuable upon exercise of a Right will be
required until cumulative adjustments would require an increase or decrease
of at least 1 percent. No fractional shares of Preferred Stock will be
issued (other than fractions which are integral multiples of one
one-thousandth of a share of Preferred Stock) and, in lieu thereof, an
adjustment in cash will
C-2
be made based on the market price of the Preferred Stock on the last trading
date prior to the date of exercise.
At any time before a person becomes an Acquiring Person, the
Company may redeem the Rights in whole, but not in part, at a price of $0.001
per Right (payable in cash, Common Stock or other consideration),
appropriately adjusted to reflect any stock split, stock dividend or similar
transaction occurring after the date hereof. In the event that there is an
Acquiring Person or any person or group (a "Proposed Acquiror") has proposed
or publicly announced an intention to propose a transaction that, if
consummated, would cause that person to become an Acquiring Person or cause
the Company to be acquired in a merger or other business combination, the
Board of Directors may redeem the Rights. Immediately upon the action of the
Board of Directors ordering redemption of the Rights, the Rights will
terminate and the only right of the holders of Rights will be to receive the
$.001 redemption price.
At any time after a person becomes an Acquiring Person, the Board
of Directors of the Company may exchange the Rights (other than Rights owned
by such person or group which have become null and void), in whole or in
part, at an exchange ratio of one share of Common Stock, or one
one-thousandth of a share of Preferred Stock (or of a share of a class or
series of the Company's preferred stock having equivalent rights, preferences
and privileges), per Right (subject to adjustment).
Until a Right is exercised, the holder thereof, as such, will have
no rights as a shareholder of the Company, including, without limitation, the
right to vote or to receive dividends. While the distribution of the Rights
will not be taxable to shareholders or to the Company, shareholders may,
depending upon the circumstances, recognize taxable income in the event that
the Rights become exercisable for Common Stock (or other consideration) of
the Company or for common stock of the acquiring company as set forth above.
The Preferred Stock will be non-redeemable. The Preferred Stock
may rank on a lower priority in respect of the preference as to dividends and
the distribution of assets with other classes or series of the Company's
preferred stock. Each share of Preferred Stock will be entitled to an
aggregate of 1,000 times the cash and non-cash (payable in kind) dividends
and distributions (other than dividends and distributions payable in Common
Stock) declared on the Company's Common Stock. In the event of liquidation,
the holders of Preferred Stock will be entitled to receive a liquidation
payment in an amount equal to 1,000 times the payment made per share of
Common Stock, plus an amount equal to declared and unpaid dividends and
distributions thereon. In the event of any merger, consolidation or other
transaction in which Common Stock is exchanged, each share of Preferred Stock
will be entitled to receive 1,000 times the amount received per share of
Common Stock. The dividend and liquidation rights of the Preferred Stock are
protected by antidilution provisions. Each share of Preferred Stock will be
entitled to 1,000 votes (subject to certain adjustments) on all matters
submitted to the shareholders.
C-3
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
______________, 2000. A copy of the Rights Agreement is available free of
charge from the Rights Agent. This summary description of the Rights does
not purport to be complete and is qualified in its entirety by reference to
the Rights Agreement, which is incorporated herein by reference.
C-4
