AMENDMENT TO RIGHTS AGREEMENT
AMENDMENT, dated as of January 10, 1999, to the Rights Agreement dated as
of March 5, 1997 between Nuevo Energy Company, a Delaware corporation (the
"Company"), and American Stock Transfer & Trust Company, a New York corporation,
as rights agent (the "Rights Agent").
WHEREAS, the Company and the Rights Agent have heretofore executed and
entered into the Rights Agreement, and, pursuant to the Rights Agreement, the
Company and the Rights Agent may from time to time supplement or amend the
Rights Agreement in accordance with the provisions of Section 27 thereof; and
WHEREAS, all acts and things necessary to make this Amendment a valid
agreement according to its terms have been done and performed, and the execution
and delivery of this Amendment by the Company and the Rights Agent has been in
all respects duly authorized by the Company and the Rights Agent.
NOW THEREFORE, in consideration of the foregoing premises and mutual
agreements set forth in the Rights Agreement and this Amendment, the parties
hereby agree as follows:
1. SECTION 1 OF THE RIGHTS AGREEMENT IS HEREBY AMENDED AS FOLLOWS:
First, Section 1(a) of the Rights Agreement is hereby amended to read in its
entirety as follows:
" (a) "Acquiring Person" shall mean any Person (as hereinafter defined)
who or which, together with all Affiliates (as hereinafter defined) and
Associates (as hereinafter defined) of such Person, shall be the Beneficial
Owner (as hereinafter defined) of securities representing 15% or more of
the shares of Common Stock then outstanding other than as the result of a
Qualifying Offer (as hereinafter defined), but shall not include the
Company, any Subsidiary (as hereinafter defined) of the Company, any
employee benefit plan of the Company or any Subsidiary of the Company, or
any entity organized, appointed or established by the Company or any
Subsidiary of the Company for or pursuant to the terms of any such plan.
Notwithstanding the foregoing, (i) no Person shall become an "Acquiring
Person" as a result of an acquisition of Common Stock by the Company which,
by reducing the aggregate number of shares of Common Stock outstanding,
increases the percentage of the total number of shares of Common Stock
outstanding which are beneficially owned by such Person to 15% or more;
provided however, that if a Person shall become the Beneficial Owner of 15%
or more of the Common Stock then outstanding by reason of purchases of
Common Stock by the Company and such Person shall, after such share
purchases by the Company, become the Beneficial Owner of additional shares
of Common Stock totaling 1% or more of the shares of Common Stock then
outstanding other than as the result of a Qualifying Offer, then such
Person shall constitute an "Acquiring Person" and (ii) if the Board of
Directors of the Company 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 and in good faith, and, if requested by the
Board of Directors, such Person agrees to divest himself of a sufficient
number of shares 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 an "Acquiring
Person" for any purposes of this Agreement."
Second, Section 1(h) is hereby deleted.
Third, Sections 1(i) through 1(n) are hereby re-designated as Sections 1(h)
through 1(m), respectively.
Fourth, a new Section 1(n) is hereby added to read in its entirety as follows:
" (n) "Qualifying Offer" shall mean an offer for all outstanding shares
of Common Stock of the Company which meets all of the following
requirements:
(i) the Person making the offer beneficially owns less than 5% of
the outstanding shares of Common Stock of the Company and has
beneficially owned less than 5% of the outstanding shares of Common
Stock of the Company during the six-month period preceding the
Commencement Date (as defined below);
(ii) the consideration offered is the same for all holders of
shares of Common Stock and is in the form of cash;
(iii) on or prior to the date that such offer is commenced
within the meaning of Rule 14d-2(a) of the General Rules and
Regulations under the Exchange Act (the "Commencement Date"), the
Person making the offer has, and has provided to the Company, firm
written commitments from responsible financial institutions, which
have been accepted by such Person (or one of its Affiliates), to
provide, subject only to customary terms and conditions, funds for
such offer which, when added to the amount of cash and cash
equivalents which such Person then has available and has irrevocably
committed in writing to the Company to utilize for purposes of such
offer, will be sufficient to pay for all shares of Common Stock
outstanding on a fully diluted basis and all related expenses;
(iv) the offer shall be conditioned upon and shall not be
consummated unless, after consummating such offer, such Person, alone
or together with any of its Affiliates, would own 75% of the then
outstanding shares of Common Stock of the Company;
(v) the consideration per share being offered pursuant to such
offer shall be, on the date of the commencement of the offer, at least
equal to the greatest amount of consideration paid for any shares of
Common Stock purchased by the Person or group making the offer within
the two-year period prior to the Commencement Date;
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(vi) in addition to the requirements of clause (v) above, the
consideration per share being offered pursuant to such offer shall be,
on the date of the commencement of the offer, at least equal to the
greater of: (x) 135% of the highest closing price (as described in
Section 11(d) hereof) for the Common Stock during the one-year period
prior to the Commencement Date or (y) 150% of the average closing
price (as described in Section 11(d) hereof) for the Common Stock
during the 20-day period prior to the Commencement Date;
(vii) such offer remains open for at least 120 Business Days;
provided, however, that (x) if there is any increase in the price of
such offer, such offer must remain open for at least an additional 20
Business Days after the last such increase, (y) such offer must remain
open for at least 20 Business Days after the date that any bona fide
alternative offer, whether or not such offer is a Qualifying Offer, is
made which, in the opinion of a nationally recognized investment
banking firm designated by the Company, provides for consideration per
share in excess of that provided for in such offer, and (z) such offer
must remain open for at least 20 Business Days after the date on which
such Person reduces the per share price offered in accordance with
clause (ix)(y) below; provided further, however, that such offer need
not remain open, as a result of this clause (vii), beyond (A) the time
which any other offer satisfying the criteria for a Qualifying Offer
is then required to be kept open under this clause (vii), or (B) the
scheduled expiration date, as such date may be extended by public
announcement on or prior to the then scheduled expiration date, of any
other tender offer for shares Common Stock with respect to which the
Board of Directors of the Company has agreed to redeem the Rights
immediately prior to acceptance for payment of shares of Common Stock
thereunder (unless such other offer is terminated prior to its
expiration without any shares of Common Stock having been purchased
thereunder);
(viii) such offer is accompanied by a written opinion, in
customary form, of a nationally recognized investment banking firm
designated by the Company, stating that the price to be paid to
holders of Common Stock pursuant to the offer is fair from a financial
point of view to such holders; and
(ix) prior to the Commencement Date, such Person or group makes
an irrevocable written commitment to the Company (x) to consummate a
transaction or transactions promptly upon the completion of such
offer, whereby all shares of Common Stock not purchased in such offer
will be acquired for the same all cash consideration and at the same
price per share paid in such offer, subject only to the condition that
the Board of Directors of the Company shall have granted any approvals
required to enable such Person to consummate such transaction or
transactions following consummation of such offer without obtaining
the vote of any other stockholder, (y) that such Person will not make
any amendment to such offer which reduces the per share price offered
(other than a reduction to reflect any
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dividend declared by the Company after the commencement of such offer
or any material change in the capital structure of the Company
initiated by the Company after the commencement of such offer, whether
by way of recapitalization, reorganization, repurchase or otherwise),
changes the form of consideration offered, reduces the number of
shares being sought or which is otherwise in any other respect
materially adverse to the Company's stockholders, and (z) that neither
such Person nor any of its Affiliates or Associates will make any
other offer for any equity securities of the Company for a period of
six months after the commencement of the original offer if such
original offer does not result in the tender of the number of shares
Common Stock required to be purchased pursuant to clause (iv) above,
unless another all cash tender offer by another party for all
outstanding shares of Common Stock is commenced (A) at a consideration
per share in excess of that provided for in such original offer (in
which event any new offer by such Person or any of its Affiliates or
Associates must be at a consideration no less than that provided for
in such higher offer), or (B) with the approval of the Board of
Directors of the Company (in which event any new offer by such Person
or any of its Affiliates or Associates must be at a consideration no
less than that provided for in such approved offer)."
2. SECTION 7(A) OF THE RIGHTS AGREEMENT IS HEREBY AMENDED TO READ IN ITS
ENTIRETY AS FOLLOWS:
" SECTION 7. EXERCISE OF RIGHTS; PURCHASE PRICE; EXPIRATION DATE OF
RIGHTS. (a) The registered holder of any Rights Certificate may exercise
the Rights evidenced thereby (except as otherwise provided herein) in whole
or in part at any time after the Distribution Date upon surrender of the
Rights Certificate, with the form of election to purchase and the
certificate on the reverse side thereof duly executed, to the Rights Agent
at the principal office or offices of the Rights Agent designated for such
purpose, together with the aggregate Purchase Price with respect to the
total number of one-hundredths of a share of Preferred Stock (or other
securities or property, as the case may be) as to which the Rights are
exercised, at or prior to the earlier of (i) the Close of Business on the
tenth anniversary of the Record Date, (ii) the time at which the Rights are
redeemed as provided in Section 24 hereof, (iii) the time at which the
Board of Directors of the Company orders the exchange of Rights pursuant to
paragraph (a) of Section 23 or (iv) the consummation of a transaction
contemplated by Section 13(f) hereof (the earlier of (i), (ii), (iii) and
(iv) is herein referred to as the "Expiration Date"). Subject to adjustment
as provided herein, each Right shall initially be exercisable for one one-
hundredth of a share of Preferred Stock."
3. SECTION 11(a)(iii) OF THE RIGHTS AGREEMENT IS HEREBY AMENDED AS FOLLOWS:
(a) The first sentence of Section 11(a)(iii) is amended by deleting the
following:
", acting by resolution of its Board of Directors (which resolution
shall be effective only with the concurrence of a majority of the
Continuing Directors), may, and,"
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and replacing such deleted language with the following:
"shall,"
(b) The first sentence of Section 11(a)(iii) is further amended by deleting
the word "shall" immediately preceding clause (A).
(c) The first sentence of Section 11(a)(iii) is further amended by
deleting, in the two places where such quote appears, the following
parenthetical:
"(with the concurrence of a majority of the Continuing Directors)"
(d) The second sentence of Section 11(a)(iii) is amended by deleting the
following parenthetical:
"(which resolution shall be effective only with the concurrence of a
majority of the Continuing Directors)"
4. SECTION 13 OF THE RIGHTS AGREEMENT IS HEREBY AMENDED AS FOLLOWS:
First, Section 13(a) is hereby amended to read in its entirety as follows:
" SECTION 13. CONSOLIDATION, MERGER OR SALE OR TRANSFER OF ASSETS OR
EARNING POWER. (b) In the event that, at any time after a Stock
Acquisition Date, directly or indirectly, (x) 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(o) hereof) and
the Company shall not be the continuing or surviving corporation of such
consolidation or merger, (y) any Person shall consolidate with the Company
or merge with and into the Company and the Company shall be the continuing
or surviving corporation of such merger and, in connection with such
merger, all or part of the shares of Common Stock shall be changed into or
exchanged for stock or other securities of any other Person or cash or any
other property, or (z) the Company shall sell, mortgage or otherwise
transfer (or one or more of its Subsidiaries shall sell, mortgage or
otherwise transfer), in one or more transactions, assets or earning power
aggregating more than 50% of the assets or earning power of the Company and
its Subsidiaries (taken as a whole) to any other Person (other than the
Company or one or more of its wholly-owned Subsidiaries in one or more
transactions each of which complies with Section 11(o) hereof) (each, a
"Section 13 Event"), then, and in each such case (except as provided in
Section 13(f) hereof), proper provision shall be made so that (i) each
holder of a Right, subject to Section 7(e) hereof, shall have the right to
receive, upon the exercise thereof at the then current Purchase Price in
accordance with the terms of this Agreement, such number of shares of
validly authorized and issued, fully paid, non-assessable, and freely
tradable shares of Common Stock of the principal party (as
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hereinafter defined), free and clear of liens, rights of call or first
refusal, encumbrances or other adverse claims, as shall be equal to the
result obtained by (1) multiplying the then current Purchase Price by the
number of one-hundredths of a share of Preferred Stock for which a Right is
then exercisable (without taking into account any adjustment previously
made pursuant to Section 11(a)(ii) hereof) and (2) dividing that product by
50% of the current market price per share of the Common Stock of such
principal party (determined pursuant to Section 11(d) hereof) on the date
of consummation of such consolidation, merger, sale or transfer; (ii) such
Principal Party shall thereafter be liable for, and shall assume, by virtue
of such consolidation, merger, sale or transfer, all the obligations and
duties of the Company pursuant to this Agreement; (iii) the term "Company"
shall thereafter be deemed to refer to such principal party, it being
specifically intended that the provisions of Section 11 hereof shall apply
to such principal party; and (iv) such 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 hereof)
in connection with such consummation as may be necessary to assure that the
provisions hereof shall thereafter be applicable, as nearly as reasonably
may be, in relation to its shares of Common Stock thereafter deliverable
upon the exercise of the Rights."
Second, a new Section 13(f) is hereby added to read in its entirety as follows:
" (f) Notwithstanding anything in this Agreement to the contrary, Section
13 shall not be applicable to a transaction described in subparagraphs (x)
and (y) of Section 13(a) if: (i) such transaction is consummated with a
Person or Persons who acquired shares of Common Stock pursuant to a
Qualifying Offer (or a wholly owned Subsidiary of any such Person or
Persons); (ii) the price per share of Common Stock offered in such
transaction is not less than the price per share of Common Stock paid to
all holders of Common Stock whose shares were purchased pursuant to such
Qualifying Offer; and (iii) the form of consideration offered in such
transaction is the same all cash consideration paid pursuant to such
Qualifying Offer. Upon consummation of any such transaction contemplated
by this Section 13(f), all Rights hereunder shall expire."
5. SECTION 24 OF THE RIGHTS AGREEMENT IS HEREBY AMENDED AS FOLLOWS:
First, Section 24(a) is hereby amended as follows:
(a) The first sentence of Section 24(a) is amended by deleting the
following parenthetical:
"(which resolution shall, if adopted following the Stock Acquisition
Date, be effective only with the concurrence of a majority of the
Continuing Directors and only if the Continuing Directors constitute a
majority of the number of directors then in offices)"
(b) The first sentence of Section 24(a) is further amended by deleting the
following:
"the Close of Business on the tenth Business Day following"
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(c) The first sentence of Section 24(a) is further amended by deleting the
following"
"; PROVIDED, HOWEVER, that the Board of Directors of the Company may
act only with the concurrence of a majority of the Continuing
Directors in authorizing redemption of the rights on or after the date
of a change (resulting from a proxy or consent solicitation effected
in compliance with applicable law and the requirements of any national
securities exchange on which the Common Stock of the Company is
listed) in a majority of the directors in office at the commencement
of such solicitation if any Person who is a participant in such
solicitation has stated (or, if upon the commencement of such
solicitation, a majority of the Board of Directors of the Company has
determined in good faith) that such Person (or any of its Affiliates
or Associates) intends to take, or may consider taking, any action
which would result in such Person becoming an Acquiring Person or
which would cause the occurrence of a triggering event"
Second, Section 24(b) is hereby deleted.
Third, Section 24(c) is hereby re-designated as Section 24(b) and all references
in the Rights Agreement to Section 24(c) are hereby amended to read 24(b).
Fourth, Section 24(d) is hereby amended as follows:
(a) The first Sentence of Section 24(d) is amended by deleting the
following parenthetical:
"(with, if required, the concurrence of a majority of the Continuing
Directors)"
(b) The first Sentence of Section 24(d) is further amended by deleting the
following:
"with the concurrence of a majority of the Continuing Directors,"
(c) Section 24(d) is hereby re-designated as Section 24(c) and all
references in the Rights Agreement to Section 24(d) are hereby amended to read
24(c).
6. SECTION 27 OF THE RIGHTS AGREEMENT IS HEREBY AMENDED AS FOLLOWS:
(a) The first sentence of Section 27 is amended by inserting "(i)" prior to
the language which reads "adversely affect the interests of the holders of the
Rights"
(b) The first sentence of Section 27 is further amended by deleting the
following:
" and only if approved by the Continuing Directors"
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and replacing such deleted language with the following:
", (ii) cause this Agreement to become amenable other than in
accordance with this sentence or (iii) cause the Rights to become
redeemable"
7. EXHIBIT C OF THE RIGHTS AGREEMENT IS HEREBY AMENDED AS FOLLOWS:
First, the First sentence of Section 8. Redemption is amended by deleting the
following:
"close of business on the tenth business day following a"
Second, the First sentence of Section 8. Redemption is amended by deleting the
following parenthetical:
"(or of certain "Continuing Directors", as hereinafter defined, if such
resolution is adopted after a Stock Acquisition Date)"
Third, the First Sentence of Section 11. Amendment of Rights Agreement is
amended by deleting the following:
"; provided, further that from and after the time that any person becomes
an Acquiring Person, the Rights Agreement shall not be supplemented or
amended in any manner without the approval of certain Directors who were
elected at a regularly scheduled, annual meeting of the Company or
Directors appointed by such Directors so elected ("Continuing Directors")"
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed as of the date first written above.
NUEVO ENERGY COMPANY
By: /s Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx, Chairman of the
Board of Directors, President and
Chief Executive Officer
AMERICAN STOCK TRANSFER & TRUST COMPANY
By: /s/ Xxxxxxx X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
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Title: Vice President
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