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Exhibit 99.1
RIGHTS AGREEMENT
between
URBAN SHOPPING CENTERS, INC.
and
FIRST CHICAGO TRUST COMPANY OF NEW YORK,
as Rights Agent
Dated as of May 5, 1999
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TABLE OF CONTENTS
Page
----
Section 1. Certain Definitions ................................................. 1
Section 2. Appointment of Rights Agent ......................................... 5
Section 3. Issuance of Right Certificates ...................................... 5
Section 4. Form of Right Certificates .......................................... 7
Section 5. Countersignature and Registration ................................... 8
Section 6. Transfer, Division, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen Right
Certificates ........................................................ 9
Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights ....... 9
Section 8. Cancellation and Destruction of Right Certificates .................. 11
Section 9. Availability of Preferred Shares .................................... 12
Section 10. Preferred Shares Record Date ....................................... 12
Section 11. Adjustment of Purchase Price, Number of Shares or Number of Rights . 13
Section 12. Certificate of Adjusted Purchase Price or Number of Shares ......... 19
Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power 20
Section 14. Fractional Rights and Fractional Shares ............................ 22
Section 15. Rights of Action ................................................... 23
Section 16. Agreement of Right Holders ......................................... 23
Section 17. Right Certificate Holder Not Deemed a Stockholder .................. 24
Section 18. Concerning the Rights Agent ........................................ 24
Section 19. Merger or Consolidation or Change of Name of Rights Agent .......... 25
Section 20. Duties of Rights Agent ............................................. 25
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Section 21. Change of Rights Agent ............................................. 28
Section 22. Issuance of New Right Certificates ................................. 28
Section 23. Redemption ......................................................... 29
Section 24. Exchange ........................................................... 30
Section 25. Notice of Certain Events ........................................... 31
Section 26. Notices ............................................................ 32
Section 27. Supplements and Amendments ......................................... 32
Section 28. Successors ......................................................... 33
Section 29. Benefits of this Agreement ......................................... 33
Section 30. Severability ....................................................... 33
Section 31. Governing Law ...................................................... 33
Section 32. Counterparts ....................................................... 33
Section 33. Descriptive Headings ............................................... 33
Section 34. Determinations and Actions by the Board ............................ 33
Exhibit A - Form of Articles Supplementary of Urban Shopping Centers, Inc.
Exhibit B - Form of Right Certificate
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RIGHTS AGREEMENT
----------------
This Rights Agreement (this "Agreement"), is entered into as of May 5,
1999 between Urban Shopping Centers, Inc., a Maryland corporation (the
"Company"), and First Chicago Trust Company of New York, as rights agent (the
"Rights Agent").
The Board (as hereinafter defined) has authorized and declared a
dividend of one preferred share purchase right (a "Right") for each Common Share
(as hereinafter defined) or Unit Voting Share (as hereinafter defined) of the
Company outstanding as of the close of business on May 19, 1999 (the "Record
Date"), each Right representing the right to purchase one one-thousandth of a
Preferred Share (as hereinafter defined), upon the terms and subject to the
conditions herein set forth, and has further authorized and directed the
issuance of one Right with respect to each Common Share or Unit Voting Share of
the Company that becomes outstanding between the Record Date and the first to
occur of the Redemption Date and the Final Expiration Date (as such terms are
hereinafter defined).
Accordingly, in consideration of the premises and the mutual agreements
herein set forth, the parties hereby agree as follows:
Section 1. Certain Definitions. For purposes of this Agreement, the
following terms have the meanings indicated:
"Acquiring Person" means any Person (as hereinafter defined)
who or which, together with all Affiliates and Associates (as such
terms are hereinafter defined) of such Person, is the Beneficial Owner
(as hereinafter defined) of 15% or more of the Common Shares of the
Company then outstanding, but does not include the Company, any
Affiliate or Subsidiary (as hereinafter defined) of the Company, any
employee benefit plan of the Company or of any Affiliate or Subsidiary
of the Company or any entity holding Common Shares for or pursuant to
the terms of any such plan, or any Grandfathered Person (as defined
below). Notwithstanding the foregoing, no Person shall be deemed an
"Acquiring Person" as the result of (i) an acquisition of Common Shares
by the Company which, by reducing the number of Common Shares
outstanding, increases the proportionate number of Common Shares
Beneficially Owned by such Person to 15% or more of the Common Shares
of the Company then outstanding, or (ii) the acquisition by such Person
of newly issued Common Shares directly from the Company (it being
understood that a purchase from an underwriter or other intermediary is
not directly from the Company); PROVIDED, HOWEVER, that if a Person
becomes the Beneficial Owner of 15% or more of the Common Shares of the
Company then outstanding by reason of Common Share acquisitions by the
Company or the acquisition of newly issued Common Shares directly from
the Company and, after such Common Share acquisitions or direct
issuance by the Company, becomes the Beneficial Owner of any additional
Common Shares of the Company, then such Person shall be deemed an
"Acquiring Person;" and provided, further, that any transferee from
such Person who becomes the Beneficial
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Owner of 15% or more of the Common Shares of the Company then
outstanding shall nevertheless be deemed an "Acquiring Person."
Notwithstanding the foregoing, if the Board determines in good faith
that a Person who would otherwise be an "Acquiring Person" became such
inadvertently (including, without limitation, because (A) such Person
was unaware that it Beneficially Owned a percentage of Common Shares
that would otherwise cause such Person to be an "Acquiring Person" or
(B) such Person was aware of the extent of its Beneficial Ownership of
Common Shares 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, then such Person shall
not be deemed an "Acquiring Person" for any purpose of this Agreement
unless and until such Person fails to divest itself, as soon as
practicable (as determined, in good faith, by the Board), of Beneficial
Ownership of a sufficient number of Common Shares so that such Person
would no longer otherwise qualify as an "Acquiring Person."
"Affiliate" and "Associate" have the respective meanings
ascribed to such terms in Rule 12b-2 under the Exchange Act, as in
effect on the date of this Agreement.
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;
(ii) which such Person or any of such Person's
Affiliates or Associates, directly or indirectly, has (A) the
right to acquire (whether such right is exercisable
immediately or only after the passage of time) pursuant to any
agreement, arrangement or understanding, whether written or
oral (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 (other than the
Rights), warrants or options, or otherwise; PROVIDED, HOWEVER,
that a Person shall not be deemed the Beneficial Owner of, or
to Beneficially Own, securities tendered pursuant to a tender
or exchange offer made by or on behalf of such Person or any
of such Person's Affiliates or Associates until such tendered
securities are accepted for purchase or exchange; (B) the sole
or shared right to vote or dispose of (including any such
right pursuant to any agreement, arrangement or understanding,
whether written or oral); PROVIDED, HOWEVER, that a Person
shall not be deemed the Beneficial Owner of, or to
Beneficially Own, any security if the agreement, arrangement
or understanding to vote such security (1) 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
under the Exchange Act and (2) is not also then reportable on
Schedule 13D under the Exchange Act (or any comparable or
successor report);
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or (C) "beneficial ownership" of (as determined pursuant to
Rule 13d-3 under the Exchange Act); or
(iii) which are Beneficially Owned, directly or
indirectly, by any other Person (or any Affiliate or Associate
thereof) with which such Person or any of such Person's
Affiliates or Associates has any agreement, arrangement or
understanding (other than customary agreements with and
between underwriters and selling group members with respect to
a bona fide public offering of securities) for the purpose of
acquiring, holding, voting (except to the extent contemplated
by the proviso to clause (B) of clause (ii) of this
definition) or disposing of any securities of the Company.
Notwithstanding anything in this definition of Beneficial
Ownership to the contrary, the phrase "then outstanding," when used
with reference to the Beneficial Ownership of securities of the Company
by any Person, means the number of such securities then issued and
outstanding together with the number of such securities not then
actually issued and outstanding which such Person would be deemed to
Beneficially Own hereunder.
"Board" means the Board of Directors of the Company.
"Business Day" means any day other than a Saturday, a Sunday,
or a day on which banking institutions in New York or Illinois are
authorized or obligated by law or executive order to close.
"Close of business" on any given date means 5:00 P.M., Eastern
time, on such date; PROVIDED, HOWEVER, that if such date is not a
Business Day it means 5:00 P.M., Eastern time, on the next succeeding
Business Day.
"Common Shares" when used with reference to the Company means
shares of the common stock, par value $0.01 per share, of the Company.
"Common Shares" when used with reference to any Person other than the
Company means the shares of the capital stock (or equity interest) with
the greatest voting power of such other Person or the equity securities
or other equity interest having power to control or direct the
management of such other Person.
"Distribution Date" has the meaning set forth in Section 3
hereof.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Ratio" has the meaning set forth in Section 24
hereof.
"Expiration Date" has the meaning set forth in Section 7
hereof.
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"Final Expiration Date" has the meaning set forth in Section 7
hereof.
"Grandfathered Person" means (i) JMB Realty Corporation, a
Delaware corporation, and its Affiliates ("JMB"), (ii) Xxxx X. Xxxxx
and members of his immediate family (collectively, "Xxxxx") and their
respective Affiliates, (iii) Xxxx X. Xxxxxx and members of his
immediate family (collectively, "Malkin") and their respective
Affiliates, and (iv) Security Capital Preferred Growth Incorporated, a
Maryland corporation ("SCPG"), and its Affiliates; PROVIDED, HOWEVER,
that SCPG and its Affiliates shall cease to be Grandfathered Persons
if, in addition to the Common Shares issued or issuable upon conversion
of the Series A Cumulative Convertible Redeemable Preferred Stock of
the Company and the Series B Cumulative Convertible Redeemable
Preferred Stock of the Company, they are the Beneficial Owners of more
than 9.8% of the Common Shares of the Company then outstanding; except,
in each such case, pursuant to dividends or rights (including the
Rights) paid or offered to stockholders of the Company generally (other
than an Acquiring Person or Persons) or as the result of an acquisition
of Common Shares by the Company which, by reducing the number of Common
Shares outstanding, increases the proportionate number of Common Shares
Beneficially Owned by such Grandfathered Person
"Person" means any individual, firm, corporation or other
entity, and includes any successor (by merger or otherwise) of such
entity.
"Preferred Shares" means shares of the Junior Participating
Preferred Stock, par value $0.01 per share, of the Company having the
rights and preferences set forth in the form of Articles Supplementary
attached to this Agreement as Exhibit A.
"Principal Party" has the meaning set forth in Section 13
hereof.
"Purchase Price" has the meaning set forth in Section 4
hereof.
"Redemption Date" has the meaning set forth in Section 7
hereof.
"Right Certificate" has the meaning set forth in Section 3
hereof.
"Securities Act" means the Securities Act of 1933, as amended.
"Shares Acquisition Date" means the first date of public
announcement (which, for purposes of this definition, includes, without
limitation, a report filed pursuant to Section 13(d) of the Exchange
Act) by the Company or an Acquiring Person that an Acquiring Person has
become such.
"Subsidiary" of any Person means 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.
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"Trading Day" has the meaning set forth in Section 11(d)(i)
hereof.
"Triggering Event" means any event described in Section
11(a)(ii) or 13(a) hereof.
"Unit Voting Shares" means shares of the unit voting common
stock, par value $0.01 per share, of the Company.
Any determination or interpretation required in connection with any of
the definitions contained in this Section 1 shall be made by the Board in its
good faith judgment, which determination shall be final and binding on the
Rights Agent and on all stockholders of the Company.
Section 2. Appointment of Rights Agent. The Company hereby appoints the
Rights Agent to act as agent for the Company and the holders of the Rights (who,
in accordance with Section 3 hereof, prior to the Distribution Date are also the
holders of the Common Shares or Unit Voting Shares) 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 deems
necessary or desirable upon ten days' prior written notice to the Rights Agent.
The Rights Agent shall have no duty to supervise and shall in no event be liable
for acts or omissions of any such co-Rights Agents.
Section 3. Issuance of Right Certificates.
(a) Until the earliest of (i) the close of business on the tenth day
after the Shares Acquisition Date, (ii) the close of business on the fifteenth
Business Day (or such later date as the Board may determine prior to such time
as any Person becomes an Acquiring Person) after the date of the commencement by
any Person (other than the Company, any Affiliate or Subsidiary of the Company,
any employee benefit plan of the Company or of any Affiliate or Subsidiary of
the Company, any entity holding Common Shares for or pursuant to the terms of
any such plan, JMB, Xxxxx and their Affiliates, or Malkin and their Affiliates)
of, or of the first public announcement of, the intention of any Person (other
than the Company, any Affiliate or Subsidiary of the Company, any employee
benefit plan of the Company or of any Affiliate or Subsidiary of the Company,
any entity holding Common Shares for or pursuant to the terms of any such plan,
JMB, Xxxxx and their Affiliates, or Malkin and their Affiliates) to commence, a
tender or exchange offer the consummation of which would result in any Person
becoming the Beneficial Owner of Common Shares aggregating 15% or more of the
then outstanding Common Shares, or (iii) the close of business on the tenth
Business Day (or such later date as the Board may determine prior to such time
as any Person becomes an Acquiring Person) after the date of filing by any
Person (other than JMB, Xxxxx and their affiliates, or Malkin and their
affiliates) of, or the first public announcement of the intention of any Person
(other than JMB, Xxxxx and their affiliates, or Malkin and their affiliates) to
file, any application, request, submission or other document with any Federal or
state regulatory authority seeking approval of, attempting to rebut any
presumption of control upon, or otherwise indicating an intention to
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enter into, any transaction or series of transactions the consummation of which
would result in any Person becoming the Beneficial Owner of Common Shares
aggregating 15% or more of the then outstanding Common Shares, other than a
transaction in which newly issued Common Shares are issued directly by the
Company to such Person (including any such date which is after the date of this
Agreement and prior to the issuance of the Rights; the earliest of such dates
being herein referred to as the "Distribution Date"), (A) the Rights shall be
evidenced (subject to the provisions of Section 3(b) hereof) by the certificates
for Common Shares or Unit Voting Shares registered in the names of the holders
thereof (which certificates shall also be deemed to be certificates for Rights)
and not by separate certificates, and (B) the Rights shall be transferable only
in connection with the transfer of the underlying Common Shares or Unit Voting
Shares (including a transfer to the Company). As soon as practicable after the
Distribution Date, the Company shall prepare and execute, the Rights Agent shall
countersign, and the Company shall send or cause to be sent (and the Rights
Agent, at the expense of the Company, shall, if requested, send) by first-class,
insured, postage-prepaid mail, to each record holder of Common Shares or Unit
Voting Shares as of the close of business on the Distribution Date, at the
address of such holder shown on the records of the Company, a Right Certificate,
in substantially the form of Exhibit B hereto (a "Right Certificate"),
evidencing one Right for each Common Share or Unit Voting Share so held. As of
the Distribution Date, the Rights shall be evidenced solely by such Right
Certificates.
(b) With respect to certificates for Common Shares or Unit Voting
Shares outstanding as of the Record Date, until the Distribution Date, the
Rights shall be evidenced by such certificates registered in the names of the
holders thereof, and registered holders of Common Shares or Unit Voting Shares
shall also be the registered holders of the associated Rights (regardless of
whether such ownership is indicated on the Common Share or Unit Voting Share
certificates). Until the earliest of the Distribution Date, the Redemption Date
or the Final Expiration Date, the transfer of any certificate for Common Shares
or Unit Voting Shares shall also constitute the transfer of the Rights
associated with the Common Shares or Unit Voting Shares represented thereby.
(c) Rights shall be issued in respect of all Common Shares or Unit
Voting Shares which are issued (whether or not previously issued) after the
Record Date but prior to the earlier of the Redemption Date or the Final
Expiration Date. Certificates evidencing such Common Shares or Unit Voting
Shares shall also be deemed to be certificates for Rights. Certificates
evidencing both Common Shares or Unit Voting Shares and Rights in accordance
with this Section 3 which are executed and delivered (whether or not the Common
Shares or Unit Voting Shares evidenced thereby were previously issued or are
presented for transfer) by the Company (including, without limitation,
certificates representing reacquired Common Shares or Unit Voting Shares
referred to in the last sentence of this Section 3(c)) 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 a legend that by itself or together with prior legends is
substantially to the following effect:
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This certificate also evidences and entitles the holder hereof to
certain rights as set forth in the Rights Agreement between Urban
Shopping Centers, Inc. (the "Company") and First Chicago Trust Company
of New York, dated as of May 5, 1999, as amended (the "Rights
Agreement"), the terms of which are hereby incorporated herein by
reference and a copy of which is on file at the principal offices of
the Company. Under certain circumstances, as set forth in the Rights
Agreement, the 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, as in
effect on the date of mailing, without charge promptly after receipt of
a written request therefor. Under certain circumstances set forth in
the Rights Agreement, Rights issued to, or held by, any Person who is,
was or becomes an Acquiring Person or an Affiliate or Associate thereof
(as such terms are defined in the Rights Agreement), whether currently
held by or on behalf of such Person or by any subsequent holder, shall
become null and void.
Until the Distribution Date, the Rights associated with the Common Shares or
Unit Voting Shares shall be evidenced by the certificates evidencing the
associated Common Shares or Unit Voting Shares alone (regardless of whether any
such certificate contains the above legend), and the transfer of any such
certificate shall also constitute the transfer of the Rights associated with the
Common Shares or Unit Voting Shares represented thereby. If the Company
purchases or acquires any Common Shares or Unit Voting Shares after the Record
Date but prior to the Distribution Date, any Rights associated with such Common
Shares or Unit Voting Shares shall be deemed canceled and retired so that the
Company shall not be entitled to exercise any Rights associated with the Common
Shares or Unit Voting Shares which are no longer outstanding.
Section 4. Form of Right Certificates.
(a) The Right Certificates (and the forms of election to purchase
Preferred Shares and 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 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 Sections 11
and 22 hereof, the Right Certificates shall entitle the holders thereof to
purchase such number of one one-thousandths of a Preferred Share as is set forth
therein at the price per one one-thousandth of a Preferred Share set forth
therein (the "Purchase Price"), but the amount and type of securities
purchasable upon the exercise of each Right and the Purchase Price thereof shall
be subject to adjustment as provided herein.
(b) Any Right Certificate issued pursuant to Section 3(a) or 22 hereof
that evidences Rights Beneficially Owned by: (i) an Acquiring Person or any
Associate or Affiliate of an
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Acquiring Person, (ii) a transferee of an Acquiring Person (or of any such
Associate or Affiliate) who becomes a transferee after the Acquiring Person
becomes an Acquiring Person, or (iii) a transferee of an Acquiring Person (or of
any such Associate or Affiliate) who becomes a transferee prior to or
concurrently with the Acquiring Person becoming such and receives such Rights
pursuant to either (A) a transfer (whether or not for consideration) from the
Acquiring Person to holders of equity interests in such Acquiring Person or to
any Person with whom the Acquiring Person has any continuing agreement,
arrangement or understanding, whether written or oral, regarding the transferred
Rights or (B) a transfer which is part of a plan, arrangement or understanding,
whether written or oral, which has as a primary purpose or effect the avoidance
of Section 7(e) hereof, and any Right Certificate issued pursuant to Section 6
or Section 11 hereof upon transfer, exchange, replacement or adjustment of any
other Right Certificate referred to in this sentence, shall contain (to the
extent feasible and otherwise reasonably identifiable as such) the following
legend:
The Rights evidenced by this Right Certificate are or were Beneficially
Owned by a Person who was or became an Acquiring Person or an Affiliate
or Associate of an Acquiring Person (as such terms are defined in the
Rights Agreement). Accordingly, this Right Certificate and the Rights
evidenced hereby may become void in the circumstances specified in
Section 7(e) of such Agreement.
The provisions of Section 7(e) shall apply whether or not any Right Certificate
actually contains the foregoing legend.
Section 5. Countersignature and Registration.
(a) The Right Certificates shall be executed on behalf of the Company
by the Chairman of the Board, its President or any of its Vice Presidents, or
its Secretary, either manually or by facsimile signature, shall have affixed
thereto the Company's seal or a facsimile thereof, and shall be attested by the
Secretary or an Assistant Secretary of the Company, either manually or by
facsimile signature. The Right Certificates shall be manually countersigned by
the Rights Agent and shall not be valid for any purpose unless countersigned. If
any officer of the Company who signs any of the Right Certificates ceases to be
such officer of the Company before countersignature by the Rights Agent and
issuance and delivery by the Company, such Right 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 Right
Certificates had not ceased to be such officer of the Company; and any Right
Certificate may be signed on behalf of the Company by any person who, at the
actual date of the execution of such Right Certificate, is a proper officer of
the Company to sign such Right Certificate, although at the date of the
execution of this Rights Agreement any such person was not such an officer.
(b) Following the Distribution Date, the Rights Agent shall keep or
cause to be kept, at its office designated for such purpose, books for
registration and transfer of the Right Certificates issued hereunder. Such books
shall show the names and addresses of the respective
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holders of the Right Certificates, the number of Rights evidenced on its face by
each of the Right Certificates and the date of each of the Right Certificates.
Section 6. Transfer, Division, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates.
(a) Subject to Sections 4(b), 7(e), 14 and 24 hereof, 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
Right Certificate or Right Certificates may be transferred, divided, combined or
exchanged for another Right Certificate or Right Certificates, entitling the
registered holder to purchase a like number of Preferred Shares (or, following a
Triggering Event, Common Shares or other securities or property, as the case may
be) as the Right Certificate or Right Certificates surrendered then entitled
such holder to purchase. Any registered holder desiring to transfer, divide,
combine or exchange any Right Certificate or Right Certificates shall make such
request in writing delivered to the Rights Agent, and shall surrender the Right
Certificate or Right Certificates to be transferred, divided, 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 Right
Certificate until the registered holder has completed and signed the certificate
contained in the form of assignment on the reverse side of such Right
Certificate and the Company has been provided with such additional evidence of
the identity of the Beneficial Owner (or former Beneficial Owner) or Affiliates
or Associates thereof as the Company reasonably requests. Thereupon the Rights
Agent shall, subject to Sections 4 and 7 hereof, countersign and deliver to the
person entitled thereto a Right Certificate or Right 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, division, combination or exchange of Right Certificates.
(b) Upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction or mutilation of
a Right Certificate, and, in case of loss, theft or destruction, of indemnity or
security reasonably 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 Right Certificate if mutilated, the Company shall make and deliver a new
Right Certificate of like tenor to the Rights Agent for countersignature and
delivery to the registered holder in lieu of the Right Certificate so lost,
stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price; Expiration Date of
Rights.
(a) Subject to Section 7(e) hereof, the registered holder of any Right
Certificate may exercise the Rights evidenced thereby (except as otherwise
provided herein) in whole or in part at any time after the Distribution Date
upon surrender of the Right Certificate, with the form of election to purchase
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
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Price with respect to each surrendered Right for the total number of Preferred
Shares (or Common Shares or other securities or property, as the case may be) as
to which the Rights are exercised, at or prior to the earliest of (i) the close
of business on May 5, 2009 (the "Final Expiration Date"), (ii) the time at which
the Rights are redeemed as provided in Section 23 hereof (the "Redemption Date")
or (iii) the time at which such Rights are exchanged as provided in Section 24
hereof (the earliest to occur of the events described in (i), (ii) and (iii)
being herein referred to as the "Expiration Date").
(b) The Purchase Price for each one one-thousandth of a Preferred Share
pursuant to the exercise of a Right is initially $128.00, is subject to
adjustment from time to time as provided in Sections 11 and 13 hereof and is
payable in lawful money of the United States of America in accordance with
Section 7(c) hereof.
(c) Upon receipt of a Right Certificate evidencing exercisable Rights,
with the form of election to purchase and the certificate on the reverse side of
the Right Certificate duly executed, accompanied by payment of the Purchase
Price for the Preferred Shares (or Common Shares or other securities or
property, as the case may be) to be purchased and an amount equal to any
applicable transfer tax required to be paid by the holder of such Right
Certificate in accordance with Section 9 hereof by certified check, cashier's
check or money order payable to the order of the Company, the Rights Agent shall
thereupon promptly (i) (A) request from any transfer agent of the Preferred
Shares (or make available, if the Rights Agent is the transfer agent of the
Preferred Shares) certificates for the number of Preferred Shares to be
purchased and the Company hereby irrevocably authorizes its transfer agent to
comply with all such requests, or (B) if the Company has elected to deposit the
Preferred Shares issuable upon exercise of the Rights with a depositary agent,
request from the depositary agent depositary receipts representing such number
of one one-thousandths of a Preferred Share as are to be purchased (in which
case certificates for the Preferred Shares evidenced by such receipts shall be
deposited by the transfer agent with the depositary agent) and the Company shall
direct the depositary agent to comply with such request, (ii) when appropriate,
request from the Company the amount of cash to be paid in lieu of issuance of
fractional shares in accordance with Section 14 hereof, (iii) after receipt of
such certificates or depositary receipts, cause the same to be delivered to or
upon the order of the registered holder of such Right Certificate, registered in
such name or names as may be designated by such holder and (iv) when
appropriate, after receipt, deliver such cash to or upon the order of the
registered holder of such Right Certificate. If the Company is obligated to
issue other securities (including Common Shares) of the Company, pay cash and/or
distribute other property pursuant to Section 11(a) hereof, the Company shall
make all arrangements necessary so that such other securities, cash and/or
property are available for distribution by the Rights Agent, if and when
appropriate.
(d) If the registered holder of any Right Certificate exercises less
than all the Rights evidenced thereby, a new Right Certificate evidencing Rights
equivalent to the Rights remaining unexercised shall be issued by the Rights
Agent and delivered to the registered holder of such Right Certificate or to his
duly authorized assigns, subject to the provisions of Section 14 hereof.
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(e) Notwithstanding anything in this Agreement to the contrary, from
and after the occurrence of a Triggering Event, any Rights Beneficially Owned by
(i) an Acquiring Person or an Associate or Affiliate of an Acquiring Person,
(ii) a transferee of an Acquiring Person (or of any such Associate or Affiliate)
who becomes a transferee after the Acquiring Person becomes an Acquiring Person
or (iii) a transferee of an Acquiring Person (or of any such Associate or
Affiliate) who becomes a transferee prior to or concurrently with the Acquiring
Person becoming an Acquiring Person and receives such Rights pursuant to either
(A) a transfer (whether or not for consideration) from the Acquiring Person to
holders of equity interests in such Acquiring Person or to any Person with whom
the Acquiring Person has any continuing agreement, arrangement or understanding,
whether written or oral, regarding the transferred Rights or (B) a transfer
which the Board otherwise concludes in good faith is part of a plan, arrangement
or understanding, whether written or oral, which has as a primary purpose or
effect the avoidance of this Section 7(e), shall become null and void without
any further action, and any holder of such Rights shall thereupon have no rights
whatsoever with respect to such Rights, whether under any provision of this
Agreement or otherwise, from and after the occurrence of a Triggering Event. The
Company shall use all reasonable efforts to insure that the provisions of this
Section 7(e) are complied with, but shall have no liability to any holder of
Rights for the inability to make any determinations with respect to an Acquiring
Person or 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 the certificate contained in the form of
election to purchase set forth on the reverse side of the Right Certificate
surrendered for such exercise has been completed and signed by the registered
holder thereof and the Company has been provided with such additional evidence
of the identity of the Beneficial Owner (or former Beneficial Owner) or
Affiliates or Associates thereof as the Company reasonably requests.
(g) The Company covenants and agrees that it shall cause to be reserved
and kept available out of its authorized and unissued Preferred Shares (and,
following the occurrence of a Triggering Event, Common Shares and/or other
securities), the number of Preferred Shares (and, following the occurrence of a
Triggering Event, Common Shares and/or other securities) that is sufficient to
permit the exercise in full of all outstanding Rights.
Section 8. Cancellation and Destruction of Right Certificates. All
Right Certificates surrendered for the purpose of exercise, transfer, division,
combination or exchange, if surrendered to the Company or to any of its agents,
shall 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 Right
Certificates shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Rights Agreement. The Company shall deliver to the
Rights Agent for cancellation and retirement, and the Rights Agent shall so
cancel and retire, any other Right Certificate purchased or acquired by the
Company otherwise than upon the exercise thereof. The Rights Agent shall deliver
all canceled Right Certificates to the Company, or shall, at the
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written request of the Company, destroy such canceled Right Certificates, and in
such case shall deliver a certificate of destruction thereof to the Company.
Section 9. Availability of Preferred Shares.
(a) The Company covenants and agrees that it shall take all such action
as may be necessary to ensure that all Preferred Shares (and, following the
occurrence of a Triggering Event, Common Shares and/or other securities)
delivered upon exercise of Rights shall, at the time of delivery of the
certificates for such Preferred Shares (and, following the occurrence of a
Triggering Event, Common Shares and/or other securities), subject to payment of
the Purchase Price, be duly and validly authorized and issued and fully paid and
nonassessable.
(b) The Company further covenants and agrees that it shall pay when due
and payable any and all Federal and state transfer taxes and charges which may
be payable in respect of the issuance or delivery of the Right Certificates or
of any Preferred Shares (or Common Shares and/or other securities, as the case
may be) upon the exercise of Rights. The Company shall not, however, be required
to pay any transfer tax which may be payable in respect of any transfer or
delivery of Right Certificates to a person other than, or the issuance or
delivery of certificates or depositary receipts for the Preferred Shares (or
Common Shares and/or other securities, as the case may be) in a name other than
that of, the registered holder of the Right Certificate evidencing Rights
surrendered for exercise or to issue or to deliver any certificates or
depositary receipts for Preferred Shares (or Common Shares and/or other
securities, as the case may be) upon the exercise of any Rights until any such
tax has been paid (any such tax being payable by the holder of such Right
Certificate at the time of surrender) or until it has been established to the
Company's reasonable satisfaction that no such tax is due.
Section 10. Preferred Shares Record Date. Each person in whose name any
certificate for Preferred Shares (or Common Shares and/or other securities, as
the case may be) is issued upon the exercise of Rights shall for all purposes be
deemed to become the holder of record of the shares or securities represented
thereby on, and such certificate shall be dated, the date on which the Right
Certificate evidencing such Rights is duly surrendered and payment of the
Purchase Price (and any applicable transfer taxes) is made; PROVIDED, HOWEVER,
that if the date of such surrender and payment is a date on which the Preferred
Shares (or Common Shares and/or other securities, as the case may be) transfer
books of the Company are closed, such person shall be deemed to become the
record holder of such shares or securities on, and such certificate shall be
dated, the next succeeding Business Day on which the Preferred Shares (or Common
Shares 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 Right Certificate is not entitled to any rights of a holder of
Preferred Shares (or Common Shares and/or other securities, as the case may be)
for which the Rights are exercisable, including, without limitation, the right
to vote, to receive dividends or other distributions or to exercise any
preemptive rights, and is not entitled to receive any notice of any proceedings
of the Company, except as provided herein.
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Section 11. Adjustment of Purchase Price, Number of Shares or Number of
Rights. The Purchase Price, the number of Preferred Shares 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) If the Company at any time after the date of this
Agreement (A) declares a dividend on the Preferred Shares payable in
Preferred Shares, (B) subdivides the outstanding Preferred Shares, (C)
combines the outstanding Preferred Shares into a smaller number of
Preferred Shares or (D) issues any of its stock in a reclassification
of the Preferred Shares (including any such reclassification in
connection with a consolidation or merger in which the Company is the
continuing or surviving entity), except as otherwise provided in this
Section 11(a) and Section 7(e) hereof, 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, and the number
and kind of shares of stock issuable on such date, shall be
proportionately adjusted so that the holder of any Right exercised
after such time is entitled to receive the aggregate number and kind of
shares of stock which, if such Right had been exercised immediately
prior to such date and at a time when the Preferred Shares transfer
books of the Company were open, such holder would have owned upon such
exercise and been entitled to receive by virtue of such dividend,
subdivision, combination or reclassification; PROVIDED, HOWEVER, that
in no event shall the consideration to be paid upon the exercise of one
Right be less than the aggregate par value of the shares of stock of
the Company issuable upon exercise of one Right. If an event occurs
which would require an adjustment under both this Section 11(a)(i) and
Section 11(a)(ii) hereof, the adjustment provided for in this Section
11(a)(i) shall be in addition to, and shall be made prior to, any
adjustment required pursuant to Section 11(a)(ii) hereof.
(ii) Subject to Section 24 of this Agreement, if any Person
becomes an Acquiring Person, each holder of a Right, except as provided
below and in Section 7(e) hereof, thereafter has a right to receive,
upon exercise thereof at a price equal to the then current Purchase
Price multiplied by the number of one one-thousandths of a Preferred
Share for which a Right is then exercisable, in accordance with the
terms of this Agreement and in lieu of Preferred Shares, such number of
Common Shares of the Company as equals the result obtained by (A)
multiplying the then current Purchase Price by the number of one
one-thousandths of a Preferred Share for which a Right is then
exercisable and dividing that product by (B) 50% of the then current
per share market price of the Company's Common Shares (determined
pursuant to Section 11(d) hereof) on the date of the occurrence of such
event. If any Person becomes an Acquiring Person and the Rights are
then outstanding, the Company shall not take any action which would
eliminate or diminish the benefits intended to be afforded by the
Rights.
(iii) In lieu of issuing Common Shares of the Company in
accordance with Section 11(a)(ii) hereof, the Company may, in the sole
discretion of the Board, elect to (and, in the event that the Board has
not exercised the exchange right contained in Section 24 hereof and
there are not sufficient issued but not outstanding and authorized
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but unissued Common Shares to permit the exercise in full of the Rights
pursuant to Section 11(a)(ii) hereof, the Company shall) take all such
action as may be necessary to authorize, issue or pay, upon the
exercise of the Rights, cash (including by way of a reduction of the
Purchase Price), property, other securities or any combination thereof
having an aggregate value equal to the value of the Common Shares of
the Company which otherwise would have been issuable pursuant to
Section 11(a)(ii) hereof, which aggregate value shall be determined by
a majority of the Board. For purposes of the preceding sentence, the
value of the Common Shares shall be determined pursuant to Section
11(d) hereof and the value of any equity securities which a majority of
the Board determines to be equivalent to a Common Share (including the
Preferred Shares, in such ratio as the Board determines) shall be
deemed to have the same value as the Common Shares. Any such election
by the Board must be made and publicly announced within 60 days
following the date on which the event described in Section 11(a)(ii)
hereof occurred. Following the occurrence of the event described in
Section 11(a)(ii) hereof, a majority of the Board then in office may
suspend the exercisability of the Rights for a period of up to 60 days
following the date on which the event described in Section 11(a)(ii)
hereof occurred to the extent that the Board has not determined whether
to exercise the Company's right of election under this Section
11(a)(iii). 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.
(b) If the Company fixes a record date for the issuance of rights,
options or warrants to all holders of Preferred Shares entitling them (for a
period expiring within 45 calendar days after such record date) to subscribe for
or purchase Preferred Shares (or shares of stock having the same rights,
privileges and preferences as Preferred Shares ("equivalent preferred shares"))
or securities convertible into Preferred Shares or equivalent preferred shares
at a price per Preferred Share or equivalent preferred share (or having a
conversion price per share, if a security convertible into Preferred Shares or
equivalent preferred shares) less than the then current per share market price
of the Preferred Shares (as defined in Section 11(d)) on such record date, the
Purchase Price to be in effect after such record date shall be determined by
multiplying the Purchase Price in effect immediately prior to such record date
by a fraction, the numerator of which shall be the number of Preferred Shares
outstanding on such record date plus the number of Preferred Shares which the
aggregate offering price of the total number of Preferred Shares and/or
equivalent preferred 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 market price and the denominator of which shall be the number of
Preferred Shares outstanding on such record date plus the number of additional
Preferred Shares and/or equivalent preferred shares to be offered for
subscription or purchase (or into which the convertible securities so to be
offered are initially convertible); PROVIDED, HOWEVER, that in no event shall
the consideration to be paid upon the exercise of one Right be less than the
aggregate par value of the shares of stock of the Company issuable upon exercise
of one Right. If such subscription price is paid in a consideration part or all
of which is in a form other than cash, the value of such consideration shall be
as determined in good faith by the Board, whose determination shall be described
in a statement filed with the Rights Agent and shall be binding on the Rights
Agent
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and on the holders of the Rights. Preferred Shares 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 Purchase Price shall be adjusted to be the Purchase Price
which would then be in effect if such record date had not been fixed.
(c) If the Company fixes a record date for the making of a distribution
to all holders of the Preferred Shares (including any such distribution made in
connection with a consolidation or merger in which the Company is the continuing
or surviving entity) of evidences of indebtedness or assets (other than a
regular periodic cash dividend or a dividend payable in Preferred Shares) or
subscription rights or warrants (excluding those referred to in Section 11(b)
hereof), the Purchase Price to be in effect after such record date shall be
determined by multiplying the Purchase Price in effect immediately prior to such
record date by a fraction, the numerator of which shall be the then current per
share market price of the Preferred Shares on such record date, less the fair
market value (as determined in good faith by the Board, whose determination
shall be described in a statement filed with the Rights Agent) of the portion of
the assets or evidences of indebtedness so to be distributed or of such
subscription rights or warrants attributable to one Preferred Share and the
denominator of which shall be such current per share market price of the
Preferred Shares; PROVIDED, HOWEVER, that in no event shall the consideration to
be paid upon the exercise of one Right be less than the aggregate par value of
the shares of stock of the Company to be issued upon exercise of one Right. Such
adjustments shall be made successively whenever such a record date is fixed; and
in the event that such distribution is not so made, the Purchase Price shall
again be adjusted to be the Purchase Price which would then be in effect if such
record date had not been fixed.
(d)(i) For the purpose of any computation hereunder, other
than under Section 11(a)(iii) hereof, the "current per share market
price" of any security (a "Security" for the purpose of this Section
11(d)(i)) on any date shall be deemed to be the average of the daily
closing prices per share of such Security for the 30 consecutive
Trading Days (as such term is hereinafter defined) immediately prior to
such date, and for the purpose of any computation under Section
11(a)(iii) hereof, the "current per share market price" of a Security
on any date shall be deemed to be the average of the daily closing
prices per share of such Security for the 30 consecutive Trading Days
immediately following such date; PROVIDED, HOWEVER, that if the current
per share market price of the Security is determined during a period
following the announcement by the issuer of such Security of (A) a
dividend or distribution on such Security payable in shares of such
Security or securities convertible into such shares (other than the
Rights), or (B) any subdivision, combination or reclassification of
such Security and prior to the expiration of 30 Trading Days after 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 reflect the current market price per share
equivalent (ex-dividend) of such Security. The closing price for each
day shall be the last sale price, regular way, or, if no such sale
takes place on such day, the average of the closing bid and asked
prices, regular way, in either case as
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reported in the principal consolidated transaction reporting system
with respect to securities listed or admitted to trading on the New
York Stock Exchange ("NYSE") or, if the Security is not listed or
admitted to trading on the NYSE, as reported in the principal
consolidated transaction reporting system with respect to securities
listed on the principal national securities exchange on which the
Security is listed or admitted to trading or, if the Security 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 Quotation
System ("NASDAQ") or such other system then in use, or, if on any such
date the Security 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 Security selected by the Board. If
on any such date no market maker is making a market in the Security,
the fair value of such Security on such date (as determined in good
faith by the Board) shall be used. The term "Trading Day" means a day
on which the principal national securities exchange on which the
Security is listed or admitted to trading is open for the transaction
of business or, if the Security is not listed or admitted to trading on
any national securities exchange, a Business Day.
(ii) For the purpose of any computation hereunder, the
"current per share market price" of the Preferred Shares shall be
determined in accordance with the method set forth in Section 11(d)(i)
hereof. If the Preferred Shares are not publicly traded, the "current
per share market price" of the Preferred Shares shall be conclusively
deemed to be the current per share market price of the Common Shares of
the Company as determined pursuant to Section 11(d)(i) hereof
(appropriately adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the date hereof), multiplied by one
thousand. If neither the Common Shares of the Company nor the Preferred
Shares are publicly traded, the "current per share market price" means
the fair value per share as determined in good faith by the Board,
whose determination shall be described in a statement filed with the
Rights Agent.
(e) Anything herein to the contrary notwithstanding, no adjustment in
the Purchase Price is required unless such adjustment would require an increase
or decrease of at least 1% in the Purchase Price; PROVIDED, HOWEVER, that any
adjustments which by reason of this Section 11(e) are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
All calculations under this Section 11 shall be made to the nearest cent or to
the nearest one one-millionth of a Preferred Share or one ten-thousandth of any
other share of stock or security, 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) or
13(a) hereof, the holder of any Right thereafter exercised becomes entitled to
receive any shares of stock of the Company other than Preferred Shares,
thereafter the number of such other shares
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so receivable upon exercise of any Right shall be subject to adjustment from
time to time in a manner and on terms as nearly equivalent as practicable to the
provisions with respect to the Preferred Shares contained in this Section 11,
and the provisions of Sections 7, 9, 10, 13 and 14 hereof with respect to the
Preferred Shares shall apply on like terms to any such other shares.
(g) All Rights originally issued by the Company subsequent to any
adjustment made to the Purchase Price hereunder shall entitle the holder thereof
to purchase, at the adjusted Purchase Price, the number of one one-thousandths
of a Preferred Share purchasable from time to time hereunder upon exercise of
the Rights, all subject to further adjustment as provided herein.
(h) Unless the Company has exercised its election as provided in
Section 11(i) hereof, upon each adjustment of the Purchase Price as a result of
the calculations made in Sections 11(b) and 11(c) hereof, each Right outstanding
immediately prior to the making of such adjustment shall thereafter entitle the
holder thereof to purchase, at the adjusted Purchase Price, that number of one
one-thousandths of a Preferred Share (calculated to the nearest one
one-millionth of a Preferred Share) obtained by (i) multiplying (A) the number
of one one-thousandths of a Preferred Share covered by a Right immediately prior
to such adjustment by (B) the Purchase Price in effect immediately prior to such
adjustment of the Purchase Price and (ii) dividing the product so obtained by
the Purchase Price in effect immediately after such adjustment of the Purchase
Price.
(i) The Company may elect on or after the date of any adjustment of the
Purchase Price to adjust the number of Rights, in substitution for any
adjustment in the number of one one-thousandths of a Preferred Share purchasable
upon the exercise of a Right. Each of the Rights outstanding after such
adjustment of the number of Rights shall be exercisable for the number of one
one-thousandths of a Preferred Share for which a Right was exercisable
immediately prior to such adjustment. Each Right held of record prior to such
adjustment of the number of Rights shall become that number of Rights
(calculated to the nearest one ten-thousandth) obtained by dividing the Purchase
Price in effect immediately prior to adjustment of the Purchase Price by the
Purchase Price in effect immediately after adjustment of the Purchase Price. The
Company shall make a public announcement of its election to adjust the number of
Rights, indicating the record date for the adjustment, and, if known at the
time, the amount of the adjustment to be made. Such record date may be the date
on which the Purchase Price is adjusted or any day thereafter, but, if the Right
Certificates have been issued, shall be at least 10 days later than the date of
the public announcement. If Right Certificates have been issued, upon each
adjustment of the number of Rights pursuant to this Section 11(i), the Company
shall, as promptly as practicable, cause to be distributed to holders of record
of Right Certificates on such record date Right Certificates evidencing, subject
to Section 14 hereof, the additional Rights to which such holders are entitled
as a result of such adjustment, or, at the option of the Company, shall cause to
be distributed to such holders of record in substitution and replacement for the
Right Certificates held by such holders prior to the date of adjustment, and
upon surrender thereof, if required by the Company, new Right Certificates
evidencing all the Rights to which such holders are entitled after such
adjustment. Right Certificates so to be
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distributed shall be issued, executed and countersigned in the manner provided
for herein and shall be registered in the names of the holders of record of
Right Certificates on the record date specified in the public announcement.
(j) Irrespective of any adjustment or change in the Purchase Price or
the number of one one-thousandths of a Preferred Share issuable upon the
exercise of the Rights, the Right Certificates theretofore and thereafter issued
may continue to express the Purchase Price and the number of one one-thousandths
of a Preferred Share which were expressed in the initial Right Certificates
issued hereunder.
(k) Before taking any action that would cause an adjustment reducing
the Purchase Price below one one-thousandth of the then par value, if any, of
the Preferred Shares issuable upon exercise of the Rights, the Company shall
take any action which may, in the opinion of its counsel, be necessary in order
that the Company may validly and legally issue fully paid and nonassessable
Preferred Shares at such adjusted Purchase Price.
(l) In any case in which this Section 11 requires that an adjustment in
the Purchase Price be made effective as of a record date for a specified event,
the Company may elect to defer until the occurrence of such event the issuance
to the holder of any Right exercised after such record date of the Preferred
Shares and other securities of the Company, if any, issuable upon such exercise
over and above the Preferred Shares and other securities of the Company, if any,
issuable upon such exercise on the basis of the Purchase Price in effect prior
to such adjustment; PROVIDED, HOWEVER, that the Company shall deliver to such
holder a due xxxx or other appropriate instrument evidencing such holder's right
to receive such additional Preferred Shares and other securities of the Company,
if any, upon the occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary notwithstanding, the
Company is 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 it in its sole discretion determines to be advisable in order that any
consolidation or subdivision of the Preferred Shares, issuance wholly for cash
of any Preferred Shares at less than the current market price, issuance wholly
for cash of Preferred Shares or securities which by their terms are convertible
into or exchangeable for Preferred Shares, dividends on Preferred Shares payable
in Preferred Shares or issuance of rights, options or warrants referred to in
Section 11(b) hereof, hereafter made by the Company to holders of its Preferred
Shares are not taxable to such holders.
(n) If at any time after the date of this Agreement and prior to the
Distribution Date, the Company (i) declares or pays any dividend on the Common
Shares payable in Common Shares or (ii) effects a subdivision, combination or
consolidation of the Common Shares (by reclassification or otherwise than by
payment of dividends in Common Shares) into a greater or lesser number of Common
Shares, then in any such case (A) the number of one one-thousandths of a
Preferred Share purchasable after such event upon proper exercise of each Right
shall be determined by multiplying the number of one one-thousandths of a
Preferred Share so
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purchasable immediately prior to such event by a fraction, the numerator of
which is the number of Common Shares outstanding immediately before such event
and the denominator of which is the number of Common Shares outstanding
immediately after such event, and (B) each Common Share outstanding immediately
after such event shall have issued with respect to it that number of Rights
which each Common Share outstanding immediately prior to such event had issued
with respect to it. The adjustments provided for in this Section 11(n) shall be
made successively whenever such a dividend is declared or paid or such a
subdivision, combination or consolidation is effected.
(o) So long as the shares of stock issuable upon the exercise of the
Rights may be listed on any national securities exchange, the Company shall use
its best efforts to cause, from and after the Distribution Date, all shares of
stock reserved for such issuance to be listed on such exchange upon official
notice of issuance upon such exercise.
(p) The Company shall use its best efforts to (i) file, as soon as
practicable following the first occurrence of a Triggering Event, a registration
statement under the Securities Act with respect to the securities purchasable
upon exercise of the Rights on an appropriate form, (ii) cause such registration
statement to become effective as soon as practicable after such filing, and
(iii) cause such registration statement to remain effective (with a prospectus
at all times meeting the requirements of the Securities Act) until the
Expiration Date. The Company shall also take such action as may be appropriate
under the blue sky laws of the various states. The Company may temporarily
suspend, for a period of time not to exceed 90 days, the exercisability of the
Rights in order to prepare and file such registration statement or in order to
comply with such blue sky laws. Upon any such suspension, the Company shall
issue a public announcement stating that the exercisability of the Rights has
been temporarily suspended.
(q) If the Rights become exercisable following the occurrence of a
Triggering Event, the Company may permit the Rights, subject to Section 7(e)
hereof, to be exercised for 50% of the Common Shares (or cash, property or other
securities to be substituted for Common Shares pursuant to Section 11(a)(iii)
hereof) that would otherwise be purchasable under Section 11(a) hereof in
consideration of the surrender to the Company of the Rights so exercised and
without other payment of the Purchase Price. Rights exercised under this Section
11(q) shall be deemed to have been exercised in full and shall be canceled.
Section 12. Certificate of Adjusted Purchase Price or Number of Shares.
Whenever an adjustment is made as provided in Section 11 or 13 hereof, the
Company shall promptly (a) prepare a certificate setting forth such adjustment,
and a brief statement of the facts accounting for such adjustment, (b) file with
the Rights Agent and with each transfer agent for the Common Shares, Unit Voting
Shares or Preferred Shares a copy of such certificate and (c) mail a brief
summary thereof to each holder of a Right Certificate in accordance with Section
25 hereof. The Rights Agent shall be fully protected in relying on any such
certificate and on any adjustment therein contained and shall not be obligated
or responsible for calculating any adjustment and may assume that no adjustment
has been made unless and until it has received such certificate.
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Section 13. Consolidation, Merger or Sale or Transfer of Assets or
Earning Power.
(a) If after the Shares Acquisition Date, directly or indirectly, (i)
the Company consolidates with, or merges with and into, any other Person, (ii)
any Person consolidates with the Company, or merges with and into the Company
and the Company is the continuing or surviving entity of such merger and, in
connection with such merger, all or part of the Common Shares are changed into
or exchanged for stock or other securities of any other Person (or the Company)
or cash or any other property, or (iii) the Company sells or otherwise transfers
(or one or more of its Subsidiaries sell or otherwise transfer), in one or more
transactions, assets or earning power aggregating 50% or more of the assets or
earning power of the Company and its Subsidiaries (taken as a whole) to any
Person or Persons other than the Company or one or more of its wholly owned
Subsidiaries, then, and in each such case, proper provision shall be made so
that (A) each holder of a Right (except as otherwise provided herein) shall
thereafter have the right to receive, upon the exercise thereof at a price equal
to the then current Purchase Price multiplied by the number of one
one-thousandths of a Preferred Share for which a Right is then exercisable, in
accordance with the terms of this Agreement and in lieu of Preferred Shares,
such number of validly authorized and issued, fully paid, non-assessable and
freely tradeable Common Shares of the Principal Party (as hereinafter defined),
free and clear of all liens, rights of call or first refusal, encumbrances or
other adverse claims, as equals the result obtained by (I) multiplying the then
current Purchase Price by the number of one one-thousandths of a Preferred Share
for which a Right is then exercisable (or, if such Right is not then exercisable
for a number of one one-thousandths of a Preferred Share, the number of such
fractional shares for which it was exercisable immediately prior to an event
described in Section 11(a)(ii) hereof) and dividing that product by (II) 50% of
the then current per share market price of the Common Shares of such Principal
Party (determined pursuant to Section 11(d) hereof) on the date of consummation
of such consolidation, merger, sale or transfer; (B) such Principal Party shall
thereafter be liable for, and shall assume, by virtue of such consolidation,
merger, sale or transfer, or otherwise, all the obligations and duties of the
Company pursuant to this Agreement; (C) the term "Company" shall thereafter be
deemed to refer to such Principal Party; and (D) such Principal Party shall take
such steps (including, but not limited to, the authorization and reservation of
a sufficient number of its Common Shares in accordance with Section 9 hereof) in
connection with such consummation as may be necessary to assure that the
provisions hereof are thereafter applicable, as nearly as reasonably may be, in
relation to its Common Shares thereafter deliverable upon the exercise of the
Rights.
(b) "Principal Party" means:
(i) in the case of any transaction described in clause (i) or
(ii) of the first sentence of Section 13(a) hereof, the Person that is
the issuer of any securities into which Common Shares of the Company
are converted in such merger or consolidation, and if no securities are
so issued, the Person that is the surviving entity of such merger or
consolidation (including the Company, if applicable); and
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(ii) in the case of any transaction described in clause (iii)
of the first sentence of Section 13(a) hereof, the Person that is the
party receiving the greatest portion of the assets or earning power
transferred pursuant to such transaction or transactions;
PROVIDED, HOWEVER, that in any such case described in clauses (i) and (ii) of
this Section 13(b): (A) if the Common Shares of such Person are not at such time
and have not been continuously over the preceding 12-month period registered
under Section 12 of the Exchange Act, and such Person is a direct or indirect
Subsidiary of another Person the Common Shares of which are and have been so
registered, "Principal Party" refers to such other Person; (B) such Person is a
Subsidiary, directly or indirectly, of more than one Person, the Common Shares
of two or more of which are and have been so registered, "Principal Party"
refers to whichever of such Persons is the issuer of the Common Shares having
the greatest aggregate market value; and (C) if such Person is owned, directly
or indirectly, by a joint venture formed by two or more Persons that are not
owned, directly or indirectly, by the same Person, the rules set forth in
clauses (A) and (B) shall apply to each of the chains of ownership having an
interest in such joint venture as if such party were a "Subsidiary" of both or
all of such joint venturers and the Principal Parties in each such chain shall
bear the obligations set forth in this Section 13 in the same ratio as their
direct or indirect interests in such Person bear to the total of such interests.
(c) The Company shall not consummate any such consolidation, merger,
sale or transfer unless the Principal Party has sufficient Common Shares
authorized to permit the full exercise of the Rights and prior thereto the
Company and such Principal Party have executed and delivered to the Rights Agent
a supplemental agreement providing for the terms set forth in Sections 13(a) and
13(b) hereof and further providing that, as soon as practicable after the date
of any consolidation, merger, sale or transfer of assets mentioned in Section
13(a) hereof, the Principal Party shall:
(i) prepare and file a registration statement under the
Securities Act, with respect to the Rights and the securities
purchasable upon exercise of the Rights on an appropriate form, and use
its best efforts to cause such registration statement to (A) become
effective as soon as practicable after such filing and (B) remain
effective (with a prospectus at all times meeting the requirements of
the Securities Act) until the Expiration Date;
(ii) 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; and
(iii) take such actions as may be necessary or appropriate
under the blue sky laws of the various states.
The provisions of this Section 13 shall similarly apply to successive mergers or
consolidations or sales or other transfers. If one of the transactions described
in this Section 13(c) occurs at any time after the occurrence of a transaction
described in Section 11(a)(ii) hereof, the Rights
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which have not theretofore been exercised shall thereafter become exercisable in
the manner described in Section 13(a) hereof.
Section 14. Fractional Rights and Fractional Shares.
(a) The Company is not required to issue fractions of Rights or to
distribute Right Certificates which evidence fractional Rights. In lieu of such
fractional Rights, the Company may pay to the registered holders of the Right
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 is 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 is the last sale price,
regular way, or, if 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 NYSE or, if the Rights are not listed or
admitted to trading on the NYSE, 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. If on any such date no such market maker is making a
market in the Rights, the fair value of the Rights on such date as determined in
good faith by the Board shall be used.
(b) The Company is not required to issue fractions of Preferred Shares
(other than fractions which are integral multiples of one one-thousandth of a
Preferred Share) upon exercise of the Rights or to distribute certificates which
evidence fractional Preferred Shares (other than fractions which are integral
multiples of one one-thousandth of a Preferred Share). Fractions of Preferred
Shares in integral multiples of one one-thousandth of a Preferred Share may, at
the election of the Company, be evidenced by depositary receipts, pursuant to an
appropriate agreement between the Company and a depositary selected by it;
provided, that such agreement shall provide that the holders of such depositary
receipts shall have all the rights, privileges and preferences to which they are
entitled as beneficial owners of the Preferred Shares represented by such
depositary receipts. In lieu of fractional Preferred Shares that are not
integral multiples of one one-thousandth of a Preferred Share, the Company may,
to the extent necessary to reduce such fraction to an integral multiple of one
one-thousandth, pay to the registered holders of Right 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 Preferred Share.
For the purposes of this Section 14(b), the current market value of one
one-thousandth of a Preferred Share is one one-thousandth of the closing price
of a Preferred Share (as determined pursuant to the second sentence of Section
11(d)(i) hereof) for the Trading Day immediately prior to the date of such
exercise.
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(c) Following the occurrence of a Triggering Event, the Company is not
required to issue fractions of Common Shares upon exercise of the Rights or to
distribute certificates which evidence fractional Common Shares. In lieu of
fractional Common Shares, the Company may pay to the registered holders of Right
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 Common
Share. For purposes of this Section 14(c), the current market value of one
Common Share is the closing price of one Common Share (as determined pursuant to
the second sentence of 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).
Section 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 hereof, are vested in the respective registered holders of the Right
Certificates (and, prior to the Distribution Date, the registered holders of the
Common Shares or Unit Voting Shares); and any registered holder of any Right
Certificate (or, prior to the Distribution Date, of the Common Shares or Unit
Voting Shares), without the consent of the Rights Agent or of the holder of any
other Right Certificate (or, prior to the Distribution Date, of the Common
Shares or Unit Voting Shares), 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 Right Certificate in the manner provided in such
Right Certificate and in this Agreement. Without limiting the foregoing or any
remedies available to the holders of Rights, it is specifically acknowledged
that the holders of Rights would not have an adequate remedy at law for any
breach of this Agreement and shall be entitled to specific performance of the
obligations under, and injunctive relief against actual or threatened violations
of the obligations of any Person subject to, this Agreement.
Section 16. Agreement of Right 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:
(a) prior to the Distribution Date, the Rights are transferable only in
connection with the transfer of the Common Shares or Unit Voting Shares;
(b) after the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if surrendered at
the principal office of the Rights Agent, duly endorsed or accompanied by a
proper instrument of transfer;
(c) the Company and the Rights Agent may deem and treat the person in
whose name the Right Certificate (or, prior to the Distribution Date, the
associated Common Shares or Unit Voting Shares 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
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associated Common Shares or Unit Voting Shares certificate made by anyone other
than the Company or the Rights Agent) for all purposes whatsoever, and neither
the Company nor the Rights Agent 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 any other Person as a result of its inability to perform any of its
obligations under this Agreement by reason of any preliminary or permanent
injunction or other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative agency or
commission, or any statute, rule, regulation or executive order promulgated or
enacted by any governmental authority prohibiting or otherwise restraining
performance of such obligation.
Section 17. Right Certificate Holder Not Deemed a Stockholder. No
holder, as such, of any Right Certificate is entitled to vote, receive dividends
or be deemed for any purpose the holder of the Preferred Shares 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
Right Certificate be construed to confer upon the holder of any Right
Certificate, as such, any of the rights of a stockholder of the Company or any
right to vote for the election of directors or on any matter submitted to
stockholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
stockholders (except as provided in Section 25 hereof), or to receive dividends
or subscription rights, or otherwise, until the Right or Rights evidenced by
such Right Certificate are exercised in accordance with the provisions hereof.
Section 18. Concerning the Rights Agent. The Company agrees to pay to
the Rights Agent reasonable compensation for all services rendered by it
hereunder and, from time to time, upon demand of the Rights Agent, its
reasonable expenses and counsel fees and other disbursements incurred in the
administration and execution of this Agreement and the exercise and performance
of its duties hereunder. The Company also agrees to indemnify the Rights Agent
for, and to hold it harmless against, any loss, liability or expense, incurred
without gross negligence, bad faith or willful misconduct on the part of the
Rights Agent, for anything done or omitted by the Rights Agent in connection
with the acceptance and administration of this Agreement, including the costs
and expenses of defending against any claim of liability. The costs and expenses
of enforcing this right of indemnification shall also be paid by the Company.
The indemnification provided for hereunder shall survive the expiration of the
Rights and the termination of this Agreement.
The Rights Agent may conclusively rely on and shall be protected and
shall incur no liability for or in respect of any action taken, suffered or
omitted by it in connection with its administration of this Agreement in
reliance on any Right Certificate or certificate for the Preferred Shares or
Common Shares or Unit Voting Shares 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, if
necessary, verified or acknowledged, by the
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proper person or persons, or otherwise on the advice of counsel as set forth in
Section 20 hereof.
Section 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 is a party, or any Person succeeding to the stock
transfer or corporate trust 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 Section 21 hereof. If at the time such
successor Rights Agent succeeds to the agency created by this Agreement, any of
the Right Certificates have been countersigned but not delivered, any such
successor Rights Agent may adopt the countersignature of the predecessor Rights
Agent and deliver such Right Certificates so countersigned; and if at that time
any of the Right Certificates have not been countersigned, any successor Rights
Agent may countersign such Right Certificates either in the name of the
predecessor Rights Agent or in the name of the successor Rights Agent; and in
all such cases such Right Certificates shall have the full force provided in the
Right Certificates and in this Agreement.
(b) If at any time the name of the Rights Agent is changed and at such
time any of the Right Certificates have been countersigned but not delivered,
the Rights Agent may adopt the countersignature under its prior name and deliver
Right Certificates so countersigned; and if at that time any of the Right
Certificates have not been countersigned, the Rights Agent may countersign such
Right Certificates either in its prior name or in its changed name; and in all
such cases such Right Certificates shall have the full force provided in the
Right Certificates and in this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent undertakes the
duties and obligations imposed by this Agreement upon the following terms and
conditions (and no implied duties and obligations shall be interpreted against
the Rights Agent), by all of which the Company and the holders of Right
Certificates, by their acceptance thereof, shall be bound:
(a) Before the Rights Agent acts, the Rights Agent may consult with
legal counsel (who may be legal counsel for the Company), and the opinion of
such counsel shall be full and complete authorization and protection to the
Rights Agent as to any action taken or omitted by it in good faith and in
accordance with such opinion.
(b) Whenever in the performance of its duties under this Agreement the
Rights Agent deems it necessary or desirable that any fact or matter be proved
or established by the Company prior to taking or suffering any action hereunder,
such fact or matter (unless other evidence in respect thereof is specifically
prescribed herein) may be deemed to be conclusively proved and established by a
certificate signed by the Chairman of the Board, the President, any Vice
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President or the Secretary of the Company and delivered to the Rights Agent; and
such certificate shall be full authorization to the Rights Agent for any action
taken or suffered in good faith by it under the provisions of this Agreement in
reliance on such certificate.
(c) The Rights Agent shall be liable hereunder to the Company and any
other Person only for any and all losses, liabilities, costs, damages and
expenses (including attorneys' fees) arising out of or in connection with the
Rights Agent's gross negligence, bad faith or willful misconduct. Anything in
this Agreement to the contrary notwithstanding, in no event shall the Rights
Agent be liable for special, indirect or consequential loss or damage of any
kind whatsoever (including but not limited to lost profits), even if the Rights
Agent has been advised of the likelihood of such loss or damage and regardless
of the form of the action.
(d) The Rights Agent shall not be liable for or by reason of any of the
statements of fact or recitals contained in this Agreement or in the Right
Certificates (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 be under any responsibility in respect
of the validity of this Agreement or the execution and delivery hereof (except
the due execution hereof by the Rights Agent) or in respect of the validity or
execution of any Right Certificate (except its countersignature thereof); nor
shall it be responsible for any breach by the Company of any covenant or
condition contained in this Agreement or in any Right Certificate; nor shall it
be responsible for any change in the exercisability of the Rights (including the
Rights becoming 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 Section 3, 11, 13, 23 or 24 hereof, 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 Right Certificates after receipt of a
certificate furnished pursuant to Section 12 hereof describing a change or
adjustment); nor shall it by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation of any
Preferred Shares or Common Shares to be issued pursuant to this Agreement or any
Right Certificate or as to whether any Preferred Shares or Common Shares will,
when issued, be validly authorized and issued, fully paid and nonassessable.
(f) The Company covenants and agrees that it shall perform, execute,
acknowledge and deliver or cause to be performed, executed, acknowledged and
delivered all such further and other acts, instruments and assurances as may
reasonably be required by the Rights Agent for the carrying out or performing by
the Rights Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from the
Chairman of the Board, 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 or suffered by it in good faith in accordance with instructions of
any such officer or for any delay in acting while waiting for those
instructions. Any application by the
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Rights 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 or omitted by
the Rights Agent under this Agreement and the date on and/or after which such
action will be taken or such omission will be effective. The Rights Agent shall
not be liable for any action taken 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 officer of the Company actually receives such
application, unless any such officer has consented in writing to an earlier
date) unless, prior to taking any such action (or the effective date, in the
case of an omission), the Rights Agent has received written instructions in
response to such application specifying the action to be taken or omitted.
(h) The Rights Agent and any stockholder, 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 its Subsidiaries or become pecuniarily interested
in any transaction in which the Company or its Subsidiaries may be interested,
or contract with or lend money to the Company or its Subsidiaries 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 its Subsidiaries or for any other legal entity.
(i) The Rights Agent may execute and exercise any of the rights or
powers hereby vested in it or perform any duty hereunder either itself or by or
through its attorneys or agents, and the Rights Agent shall not be answerable or
accountable for any act, default, neglect or misconduct of any such attorneys or
agents or for any loss to the Company resulting from any such act, default,
neglect or misconduct, provided that reasonable care was exercised in the
selection and continued employment thereof.
(j) 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 of transfer without first consulting with the Company.
(k) 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 if
there are reasonable grounds for believing that repayment of such funds or
adequate indemnification against such risk or liability is not reasonably
assured.
(l) The Rights Agent shall not be required to take notice or be deemed
to have notice of any fact, event or determination (including, without
limitation, any dates or events defined in this Agreement or the designation of
any Person as an Acquiring Person, Affiliate or Associate) under this Agreement
unless and until the Rights Agent is specifically notified in writing by the
Company of such fact, event or determination.
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Section 21. Change of Rights Agent. The Rights Agent or any successor
Rights Agent may resign and be discharged from its duties under this Agreement
upon 30 days' notice in writing mailed to the Company and to each transfer agent
of the Common Shares, Unit Voting Shares or Preferred Shares by registered or
certified mail, and, at the expense of the Company, to the holders of the Right
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 may be, and to each transfer agent
of the Common Shares, Unit Voting Shares or Preferred Shares by registered or
certified mail, and to the holders of the Right Certificates by first-class
mail. If the Rights Agent resigns or is removed or otherwise becomes incapable
of acting, the Company shall appoint a successor Rights Agent. If the Company
fails 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
Right Certificate (who shall, with such notice, submit his Right Certificate for
inspection by the Company), then the registered holder of any Right Certificate
may apply to any court of competent jurisdiction for the appointment of a
successor Rights Agent. Any successor Rights Agent, whether appointed by the
Company or by such a court, shall be (a) a corporation or bank organized and
doing business under the laws of the United States or of any other state of the
United States, which is authorized under such laws to exercise corporate trust
or stock transfer powers and is subject to supervision or examination by Federal
or state authority and which has at the time of its appointment as Rights Agent
a combined capital and surplus of at least $100 million or (b) is an Affiliate
of a corporation 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 Shares, Unit Voting Shares or Preferred
Shares, and mail a notice thereof in writing to the registered holders of the
Right Certificates. Failure to give any notice provided for in this Section 21,
however, or any defect therein, shall not affect the legality or validity of the
resignation or removal of the Rights Agent or the appointment of the successor
Rights Agent, as the case may be.
Section 22. Issuance of New Right Certificates. Notwithstanding
anything in this Agreement or the Right Certificates to the contrary, the
Company may, at its option, issue new Right Certificates evidencing Rights in
such form as may be approved by the Board to reflect any adjustment or change in
the Purchase Price and the number or kind or class of stock or other securities
or property purchasable under the Right Certificates made in accordance with the
provisions of this Agreement. In addition, in connection with the issuance or
sale of Common Shares or Unit Voting Shares following the Distribution Date and
prior to the redemption or expiration of the Rights, the Company (a) shall, with
respect to Common Share or Unit Voting Shares so issued or sold pursuant to the
exercise of options or under any employee plan or arrangement, or upon the
exercise, conversion or exchange of securities hereinafter issued by the
Company, and (b) may, in any other case, if deemed necessary or appropriate by
the Board, issue Right Certificates representing the
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appropriate number of Rights in connection with such issuance or sale; provided,
however, that (i) no such Right Certificate shall be issued if, and to the
extent that, the Company is advised by counsel that such issuance would create a
significant risk of material adverse tax consequences to the Company or the
Person to whom such Right Certificate would be issued, and (ii) no such Right
Certificate shall be issued if, and to the extent that, appropriate adjustment
has otherwise been made in lieu of the issuance thereof.
Section 23. Redemption.
(a) The Company may, at its option, at any time prior to such time as
any Person becomes an Acquiring Person, redeem all but not less than all the
then outstanding Rights at a redemption price of $0.01 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"). The redemption of the Rights by the
Company may be made effective at such time on such basis and with such
conditions as the Board in its sole discretion may establish. The Company may,
at its option, pay the Redemption Price in cash, Common Shares (based on the
current per share market price of the Common Shares at the time of redemption)
or any other form of consideration deemed appropriate by the Board.
(b) Immediately upon the action of the Board ordering the redemption of
the Rights (or at the effective time of such redemption established by the Board
pursuant to the last sentence of Section 23(a) hereof), and without any further
action and without any notice, the right to exercise the Rights shall terminate
and the only right thereafter of the holders of Rights will be to receive the
Redemption Price. The Company shall promptly give public notice of any such
redemption; provided, however, that the failure to give, or any defect in, any
such notice shall not affect the validity of such redemption. Within 10 days
after such action of the Board ordering the redemption of the Rights or, if
later, the effectiveness of the redemption of the Rights pursuant to the last
sentence of Section 23(a) hereof, the Company shall mail a notice of redemption
to all the holders of the then outstanding Rights at their last addresses as
they appear on the registry books of the Rights Agent or, prior to the
Distribution Date, on the registry books of the transfer agent for the Common
Shares or the Unit Voting Shares. 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 shall state the method by which the
payment of the Redemption Price will be made. The Company may, at its option,
discharge all of its obligations with respect to the Rights by (i) issuing a
press release announcing the manner of redemption of the Rights, (ii) depositing
with a bank or trust company having a capital and surplus of at least $100
million, funds necessary for such redemption, in trust, to be applied to the
redemption of the Rights so called for redemption and (iii) arranging for the
mailing of the Redemption Price to the registered holders of the Rights; then,
and upon such action, all outstanding Rights Certificates shall be null and void
without further action by the Company. Neither the Company nor any of its
Affiliates or Associates may redeem, acquire or purchase for value any Rights at
any time in any manner other than that specifically set forth in this
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Section 23, in Section 24 hereof, or in connection with the purchase of Common
Shares or Unit Voting Shares prior to the Distribution Date.
Section 24. Exchange.
(a) The Company may, at its option, at any time after a Triggering
Event, exchange all or part of the then outstanding and exercisable Rights (not
including Rights that have become void pursuant to the provisions of Section
7(e) hereof) for Common Shares at an exchange ratio of one Common Share 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"). Notwithstanding the foregoing,
the Company shall not effect such exchange at any time after any Person (other
than the Company, any Affiliate or Subsidiary of the Company, any employee
benefit plan of the Company or of any Affiliate or Subsidiary of the Company,
any entity holding Common Shares for or pursuant to the terms of any such plan,
JMB, Xxxxx and their Affiliates, or Malkin and their Affiliates), together with
all Affiliates and Associates of such Person, becomes the Beneficial Owner of
50% or more of the Common Shares then outstanding.
(b) Immediately upon the action of the Board ordering the exchange of
any Rights pursuant to Section 24(a) hereof 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 will be to receive that number
of Common Shares 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; PROVIDED, HOWEVER, that the failure to give, or any defect
in, such notice shall not affect the validity of such exchange. The Company
promptly shall mail a notice of any such exchange to all of the holders of such
Rights at their last addresses as they appear on 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 shall state the method by which the exchange of the Common Shares 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 void pursuant
to the provisions of Section 7(e) hereof) held by each holder of Rights.
(c) In any exchange pursuant to this Section 24, the Company, at its
option, may substitute Preferred Shares (or equivalent preferred shares, as such
term is defined in Section 11(b) hereof) for Common Shares exchangeable for
Rights, at the initial rate of one one-thousandth of a Preferred Share (or
equivalent preferred share) for each Common Share, as appropriately adjusted to
reflect adjustments in the voting rights of the Preferred Shares pursuant to the
terms thereof, so that the fraction of a Preferred Share delivered in lieu of
each Common Share has the same voting rights as one Common Share.
(d) If there are not sufficient Common Shares or Preferred Shares
issued but not outstanding or authorized but unissued to permit any exchange of
Rights as contemplated in
30
34
accordance with this Section 24, the Company shall take all such action as may
be necessary to authorize additional Common Shares or Preferred Shares for
issuance upon exchange of the Rights.
(e) The Company is not required to issue fractions of Common Shares or
to distribute certificates which evidence fractional Common Shares. In lieu of
such fractional Common Shares, the Company shall pay to the registered holders
of the Right Certificates with regard to which such fractional Common Shares
would otherwise be issuable an amount in cash equal to the same fraction of the
current market value of a whole Common Share. For the purposes of this Section
24(e), the current market value of a whole Common Share is the closing price of
a Common Share (as determined pursuant to the second sentence of Section
11(d)(i) hereof) for the Trading Day immediately prior to the date of exchange
pursuant to this Section 24.
Section 25. Notice of Certain Events.
(a) If the Company proposes at any time after the Distribution Date (i)
to pay any dividend payable in shares of stock of any class to the holders of
its Preferred Shares or to make any other distribution to the holders of its
Preferred Shares (other than a regular quarterly cash dividend), (ii) to offer
to the holders of its Preferred Shares rights or warrants to subscribe for or to
purchase any additional Preferred Shares or shares of stock of any class or any
other securities, rights or options, (iii) to effect any reclassification of its
Preferred Shares (other than a reclassification involving only the subdivision
of outstanding Preferred Shares), (iv) to effect any consolidation or merger
into or with, or 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
transactions, of 50% or more of the assets or earning power of the Company and
its Subsidiaries (taken as a whole) to, any other Person, (v) to effect the
liquidation, dissolution or winding up of the Company or (vi) to declare or pay
any dividend on the Common Shares payable in Common Shares or to effect a
subdivision, combination or consolidation of the Common Shares (by
reclassification or otherwise than by payment of dividends in Common Shares),
then, in each such case, the Company shall give to each holder of a Right
Certificate, in accordance with Section 26 hereof, 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, sale, transfer, liquidation,
dissolution, or winding up is to take place and the date of participation
therein by the holders of the Common Shares and/or Preferred Shares, if any such
date is to be fixed, and such notice shall be so given in the case of any action
covered by clause (i) or (ii) of this Section 25(a) at least 10 days prior to
the record date for determining holders of the Preferred Shares for purposes of
such action, and in the case of any such other action, at least 10 days prior to
the date of the taking of such proposed action or the date of participation
therein by the holders of the Common Shares and/or Preferred Shares, whichever
is the earlier.
(b) If any of the events set forth in Section 11(a)(ii) hereof occurs,
then the Company shall as soon as practicable thereafter give to each holder of
a Right Certificate, in accordance with Section 26 hereof, a notice of the
occurrence of such event, which notice shall describe
31
35
such event and the consequences of such event to holders of Rights under Section
11(a)(ii) hereof.
Section 26. Notices. Notices or demands authorized by this Agreement to
be given or made by the Rights Agent or by the holder of any Right Certificate
to or on the Company are sufficiently given or made if sent by first-class mail,
postage prepaid, addressed (until another address is filed in writing with the
Rights Agent) as follows:
Urban Shopping Centers, Inc.
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Secretary
Subject to the provisions of Section 21 hereof, notices or demands
authorized by this Agreement to be given or made by the Company or by the holder
of any Right Certificate to or on the Rights Agent are sufficiently given or
made if sent by registered or certified mail and shall be deemed given upon
receipt, addressed (until another address is filed in writing with the Company)
as follows:
First Chicago Trust Company of New York
000 Xxxxxxxxxx Xxxxxxxxx
Xxxxx 0000
Xxxxxx Xxxx, Xxx Xxxxxx 00000
Attention: Corporate Actions Administrator
Notices or demands authorized by this Agreement to be given or made by
the Company or the Rights Agent to the holder of any Right Certificate shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed to such holder at the address of such holder as shown on the registry
books of the Company.
Section 27. Supplements and Amendments. The Company may from time to
time supplement or amend this Agreement without the approval of any holders of
Right Certificates in order to cure any ambiguity, to correct or supplement any
provision contained herein which may be defective or inconsistent with any other
provisions herein, or to make any other provisions with respect to the Rights
(including, without limitation, changes to the Purchase Price) which the Company
may deem necessary or desirable, any such supplement or amendment to be
evidenced by a writing signed by the Company and, if the Company so directs, the
Rights Agent; provided, however, that from and after such time as any Person
becomes an Acquiring Person, this Agreement shall not be amended in any manner
which would adversely affect the interests of the holders of Rights.
Notwithstanding anything in this Agreement to the contrary, no supplement or
amendment that changes the rights and duties of the Rights Agent under this
Agreement shall be effective against the Rights Agent without the execution of
such supplement or amendment by the Rights Agent.
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36
Section 28. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Rights Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.
Section 29. Benefits of this Agreement. Nothing in this Agreement shall
be construed to give to any Person other than the Company, the Rights Agent and
the registered holders of the Right Certificates (and, prior to the Distribution
Date, the Common Shares or Unit Voting Shares) any legal or equitable right,
remedy or claim under this Agreement; and this Agreement shall be for the sole
and exclusive benefit of the Company, the Rights Agent and the registered
holders of the Right Certificates (and, prior to the Distribution Date, the
Common Shares or Unit Voting Shares).
Section 30. 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.
Section 31. Governing Law. This Agreement and each Right Certificate
issued hereunder shall be deemed to be a contract made under the laws of the
State of Maryland and for all purposes shall be governed by and construed in
accordance with the laws of such State applicable to contracts to be made and
performed entirely within such State, except that those provisions of this
Agreement affecting the rights, duties and responsibilities of the Rights Agent
shall be governed by and construed in accordance with the law of the State of
Illinois.
Section 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.
Section 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.
Section 34. Determinations and Actions by the Board. The Board has the
exclusive power and authority to administer this Agreement and to exercise all
rights and powers specifically granted to the Directors or the Company or as may
be necessary or advisable in the administration of this Agreement, including,
without limitation, the right and power to (a) interpret the provisions of this
Agreement, and (b) make all determinations deemed necessary or advisable for the
administration of this Agreement (including a determination to redeem or not
redeem the Rights or to amend this Agreement). All such actions, interpretations
and determinations (including, for purposes of clause (b) above, all omissions
with respect to the foregoing) which are done or made by the Directors in good
faith, shall (i) be final, conclusive and binding on the Company, the Rights
Agent, the holders of the Right Certificates and all
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37
other parties, and (ii) not subject the Directors to any liability to the
holders of the Right Certificates.
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38
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.
URBAN SHOPPING CENTERS, INC.
By: /s/ Xxxx X. Xxxx
-----------------------------------
Name: Xxxx X. Xxxx
Title: Executive Vice President
Attest:
By: /s/ Xxxxxxx Xxxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Senior Vice President
FIRST CHICAGO TRUST COMPANY OF NEW YORK
By: /s/ Xxxxxx Gorostioli
-----------------------------------
Name: Xxxxxx Gorostioli
Title: Assistant Vice President
Attest:
By: /s/ Xxxx X. Xxxxxx
-----------------------------------
Name: Xxxx X. Xxxxxx
Title: Customer Service Officer
39
Exhibit A
URBAN SHOPPING CENTERS, INC.
FORM OF
ARTICLES SUPPLEMENTARY
JUNIOR
PARTICIPATING PREFERRED STOCK
Urban Shopping Centers, Inc., a Maryland corporation (hereinafter
called the "Corporation"), hereby certifies to the State Department of
Assessments and Taxation of Maryland that:
FIRST: The Board of Directors of the Corporation (the "Board") has
classified and designated 80,000 unissued shares of series preferred stock, par
value $0.01 per share, of the Corporation as shares of Junior Participating
Preferred Stock ("Junior Participating Preferred Shares"), with the preferences,
rights, voting powers, restrictions, limitations as to dividends, qualifications
and terms and conditions of redemption thereof as follows, which upon any
restatement of the Corporation's charter (the "Charter") shall be made part of
Article Fifth thereof, with any necessary or appropriate changes to the
enumeration or lettering of sections or subsections hereof:
Section 1. Designation and Amount. There shall be a series of series
preferred stock of the Corporation, par value $0.01 per share, which shall be
designated "Junior Participating Preferred Stock," and the number of shares
constituting that series shall be 80,000. Such number of shares may be increased
or decreased by resolution of the Board; provided, however, that no decrease
shall reduce the number of Junior Participating Preferred Shares to a number
less than the number of Junior Participating Preferred Shares then outstanding
plus the number of Junior Participating Preferred Shares issuable upon exercise
of outstanding rights, options or warrants or upon conversion of outstanding
securities issued by the Corporation.
Section 2. Dividends and Distributions.
(a) Subject to the prior and superior rights of the holders of any
shares of any class or series of series preferred stock of the Corporation
ranking prior and superior to the Junior Participating Preferred Shares with
respect to dividends, the holders of Junior Participating Preferred Shares are
entitled to receive, when, as and if authorized by the Board out of funds
legally available for the purpose, quarterly dividends payable in cash to
holders of record on the last Business Day of January, April, July and October
in each year (each such date being referred to herein as a "Quarterly Dividend
Payment Date") (commencing on the first Quarterly Dividend Payment Date after
the first issuance of a Junior Participating Preferred Share or fraction
thereof) in an amount per share (rounded to the nearest cent) equal to the
greater of (i)
40
$1.00 or (ii) subject to the provision for adjustment hereinafter set forth,
1,000 times the aggregate per share amount of all cash dividends, and 1,000
times the aggregate per share amount (payable in kind) of all non-cash dividends
or other distributions other than a dividend payable in Common Shares (as
hereinafter defined) or a subdivision of the outstanding Common Shares (by a
reclassification or otherwise), authorized on shares of the Corporation's common
stock, par value $0.01 per share, (the "Common Shares"), since the immediately
preceding Quarterly Dividend Payment Date, or, with respect to the first
Quarterly Dividend Payment Date, since the first issuance of any Junior
Participating Preferred Share or fraction thereof. If the Corporation at any
time following May 5, 1999 (A) declares any dividend on Common Shares payable in
Common Shares, (B) subdivides the outstanding Common Shares into a greater
number of shares or (C) combines the outstanding Common Shares into a smaller
number of shares, then in each such case the amount to which holders of Junior
Participating Preferred Shares were entitled immediately prior to such event
under clause (ii) of the preceding sentence shall be adjusted by multiplying
each such amount 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.
(b) The Corporation shall declare a dividend or distribution on the
Junior Participating Preferred Shares as provided in Section 2(a) at the time it
declares a dividend or distribution on the Common Shares (other than a dividend
payable in Common Shares; provided that in the event no dividend or
distribution shall have been declared on the Common Shares during the period
between any Quarterly Dividend Payment Date and the next subsequent Quarterly
Dividend Payment Date, a dividend of $1.00 per share on the Junior
Participating Preferred Shares shall nevertheless be payable on such Quarterly
Dividend Payment Date).
(c) No dividend or distribution (other than a dividend or distribution
payable in Common Shares) shall be paid or payable to the holders of Common
Shares, or the holders of Unit Voting Shares, unless, prior thereto, all accrued
but unpaid dividends to the date of that dividend or distribution have been paid
to the holders of Junior Participating Preferred Shares.
(d) Dividends shall begin to accrue and be cumulative on outstanding
Junior Participating Preferred Shares from the Quarterly Dividend Payment Date
next preceding the date of issuance of such Junior Participating Preferred
Shares, unless the date of issuance of such shares is prior to the record date
for the first Quarterly Dividend Payment Date, in which case dividends on such
shares shall begin to accrue and be cumulative from the date of issuance of such
shares, or unless the date of issuance is a Quarterly Dividend Payment Date or
is a date after the record date for the determination of holders of Junior
Participating Preferred Shares entitled to receive a quarterly dividend and
before such Quarterly Dividend Payment Date, in either of which events such
dividends shall begin to accrue and be cumulative from such Quarterly Dividend
Payment Date. Accrued but unpaid dividends shall not bear interest. Dividends
paid on the Junior Participating 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. The Board may fix a record date for the determination of
holders of Junior Participating Preferred Shares entitled to receive payment of
a dividend or distribution declared thereon, which record date shall be no more
than 30 days prior to the date fixed for the payment thereof.
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41
Section 3. Voting Rights. The holders of Junior Participating Preferred
Shares shall have the following voting rights:
(a) Subject to the provision for adjustment hereinafter set forth, each
one one-thousandth of a Junior Participating Preferred Share entitles the holder
thereof to one vote on all matters submitted to a vote of the stockholders of
the Corporation. If the Corporation at any time following May 5, 1999 (i)
declares any dividend on Common Shares payable in Common Shares, (ii) subdivides
the outstanding Common Shares into a greater number of shares or (iii) combines
the outstanding Common Shares into a smaller number of shares, then in each such
case the number of votes per share to which holders of Junior Participating
Preferred Shares were entitled immediately prior to such event shall be adjusted
by multiplying such number 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.
(b) Except as otherwise provided herein, the holders of Junior
Participating Preferred Shares and the holders of Common Shares and shares of
the Company's unit voting common stock, par value $0.01 per share (the "Unit
Voting Shares"), and any other shares of stock of the Corporation having general
voting rights shall vote together as one class on all matters submitted to a
vote of stockholders of the Corporation.
(c) (i) Whenever, at any time or times, dividends payable on any Junior
Participating Preferred Shares are in arrears in an amount equal to at
least six full quarterly dividends (whether or not declared and whether
or not consecutive), the holders of record of the outstanding Junior
Participating Preferred Shares shall have the exclusive right, voting
separately as a single class, to elect two Directors of the Corporation
at a special meeting of stockholders of the Corporation or at the
Corporation's next annual meeting of stockholders, and at each
subsequent annual meeting of stockholders, as provided below. At
elections for such Directors, the holders of Junior Participating
Preferred Shares are entitled to cast one vote for each one
one-thousandth of a Junior Participating Preferred Share held, subject
to adjustment.
(ii) Upon the vesting of such right of the holders of Junior
Participating Preferred Shares, the number of members of the Board
shall automatically be increased by two and the two vacancies so
created shall be filled by vote of the holders of the outstanding
Junior Participating Preferred Shares as hereinafter set forth. A
special meeting of the stockholders of the Corporation then entitled to
vote shall be called by the Chairman (or any Co-Chairman), the
President, any Senior Vice President or the Secretary of the
Corporation, if requested in writing by the holders of record of not
less than 10% of the Junior Participating Preferred Shares then
outstanding. At such special meeting, or, if no such special meeting is
called, then at the next annual meeting of stockholders of the
Corporation, the holders of the Junior Participating Preferred Shares
shall elect, voting as above provided, two Directors of the Corporation
to fill the vacancies created by the automatic increase in the number
of members of the
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Board. At any and all such meetings for such election, a majority of
the outstanding Junior Participating Preferred Shares is necessary to
constitute a quorum for such election, whether present in person or by
proxy, and such two Directors shall be elected by the vote of at least
a plurality of shares held by stockholders present or represented at
the meeting. Any Director elected by holders of Junior Participating
Preferred Shares pursuant to this Section 3(c) may be removed at any
annual or special meeting, by vote of a majority of the stockholders
voting as a class who elected such Director, with or without cause. If
any vacancy occurs among the Directors elected by the holders of the
Junior Participating Preferred Shares pursuant to this Section 3(c),
such vacancy may be filled by the remaining Director so elected, or his
successor then in office, and the Director so elected to fill such
vacancy shall serve until the next meeting of stockholders for the
election of Directors. After the holders of the Junior Participating
Preferred Shares have exercised their right to elect Directors in any
default period and during the continuance of such period, the number of
Directors shall not be further increased or decreased except by vote of
the holders of Junior Participating Preferred Shares as herein provided
or pursuant to the rights of any equity securities ranking senior to or
pari passu with the Junior Participating Preferred Shares.
(iii) The right of the holders of the Junior Participating
Preferred Shares, voting separately as a class, to elect two Directors
shall continue until, and only until, such time as all arrears in
dividends (whether or not declared) on the Junior Participating
Preferred Shares are paid or declared and set apart for payment, at
which time such right shall terminate, except as herein or by law
expressly provided, subject to revesting in the event of each and every
subsequent default of the character described in Section 3(c)(i). Upon
any termination of the right of the holders of the Junior Participating
Preferred Shares as a class to vote for Directors as herein provided,
the term of office of all Directors then in office elected by the
holders of Junior Participating Preferred Shares pursuant to this
Section 3(c) shall terminate immediately. Whenever the term of office
of the Directors elected by the holders of Junior Participating
Preferred Shares pursuant to this Section 3(c) terminates and the
special voting powers vested in the holders of Junior Participating
Preferred Shares pursuant to this Section 3(c) expire, the number of
members of the Board shall be such number as may be provided for in the
Bylaws of the Corporation irrespective of any increase made pursuant to
the provisions of this Section 3(c).
(d) Except as otherwise provided herein or required by law, holders of
Junior Participating Preferred Shares have no special voting rights and their
consent is not required (except to the extent they are entitled to vote with
holders of Common Shares and Unit Voting Shares as provided herein) for taking
any corporate action.
Section 4. Certain Restrictions.
(a) Whenever any quarterly dividends or other dividends or
distributions payable on the Junior Participating Preferred Shares as provided
in Section 2 are in arrears, then, thereafter
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and until all accrued and unpaid dividends and distributions, whether or not
declared, on Junior Participating Preferred Shares outstanding are paid in full,
the Corporation shall not:
(i) declare or pay dividends on, make any other distributions
on, or redeem or purchase or otherwise acquire for consideration any
shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up of the Corporation) to the
Junior Participating Preferred Shares, other than dividends paid or
payable in such junior shares;
(ii) declare or pay dividends on or make any other
distributions on any shares of stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up of the
Corporation) with the Junior Participating Preferred Shares, except
dividends paid ratably on the Junior Participating Preferred Shares and
all such parity shares on which dividends are payable or in arrears in
proportion to the total amounts to which the holders of all such shares
are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up of the
Corporation) with the Junior Participating Preferred Shares, provided
that the Corporation may at any time redeem, purchase or otherwise
acquire any such parity shares in exchange for shares of stock of the
Corporation ranking junior (either as to dividends or upon dissolution,
liquidation or winding up of the Corporation) to the Junior
Participating Preferred Shares; or
(iv) purchase or otherwise acquire for consideration any
Junior Participating Preferred Shares, except in accordance with a
purchase offer made in writing or by publication (as determined by the
Board) to all holders of such shares upon such terms as the Board,
after consideration of the respective annual dividend rates and other
relative rights and preferences of the respective series and classes,
determines in good faith will result in fair and equitable treatment
among the respective series or classes.
(b) 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 Section 4(a), purchase or
otherwise acquire such shares at such time and in such manner.
Section 5. Reacquired Shares. Any Junior Participating Preferred Shares
purchased or otherwise acquired by the Corporation in any manner whatsoever
shall become authorized but unissued shares of series preferred stock and may be
reissued as part of a new series of series preferred stock to be created by
resolution or resolutions of the Board, subject to the conditions and
restrictions on issuance set forth herein.
Section 6. Liquidation, Dissolution or Winding Up. (a) Upon any
voluntary liquidation, 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
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44
up) to the Junior Participating Preferred Shares unless, prior thereto, the
holders of Junior Participating Preferred Shares have received $1.00 per share,
plus an amount equal to accrued and unpaid dividends and distributions thereon,
whether or not declared, to the date of such payment (the "Junior Participating
Liquidation Preference"). Following the payment of the full amount of the Junior
Participating Liquidation Preference, no additional distributions shall be made
to the holders of Junior Participating Preferred Shares unless, prior thereto,
the holders of Common Shares and Unit Voting Shares have received an amount per
share (the "Common Adjustment") equal to the quotient obtained by dividing (i)
the Junior Participating Liquidation Preference by (ii) 1,000 (as appropriately
adjusted as set forth in Section 6(c) to reflect such events as stock splits,
stock dividends and recapitalizations with respect to the Common Shares) (such
number in clause (ii), the "Adjustment Number"). Following the payment of the
full amount of the Junior Participating Liquidation Preference and the Common
Adjustment in respect of all outstanding Junior Participating Preferred Shares
and Common Shares and Unit Voting Shares, respectively, holders of Junior
Participating Preferred Shares and holders of Common Shares and Unit Voting
Shares shall receive their ratable and proportionate share of the remaining
assets to be distributed in the ratio, on a per share basis, of the Adjustment
Number to 1 with respect to such Junior Participating Preferred Shares and
Common Shares and Unit Voting Shares, on a per share basis, respectively.
(b) If, however, there are not sufficient assets available to permit
payment in full of the Junior Participating Liquidation Preference and the
liquidation preferences of all other series of series preferred stock, if any,
which rank on a parity with the Junior Participating Preferred Shares, then such
remaining assets shall be distributed ratably to the holders of the Junior
Participating Preferred Shares and such parity stock in proportion to their
respective liquidation preferences.
(c) If the Corporation at any time following May 5, 1999 (i) declares
any dividend on Common Shares payable in Common Shares, (ii) subdivides the
outstanding Common Shares into a greater number of shares or (iii) combines the
outstanding Common Shares into a smaller number of shares, then in each such
case the Adjustment Number in effect immediately prior to such event shall be
adjusted by multiplying such Adjustment Number 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.
Section 7. Consolidation, Merger, etc. If the Corporation enters 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 Junior Participating Preferred
Shares shall at the same time be similarly exchanged or changed in an amount per
share (subject to the provision for adjustment hereinafter set forth) equal to
1,000 times 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 exchanged or changed. If the Corporation at any time (a)
declares any dividend on Common Shares payable in Common Shares, (b) subdivides
the outstanding Common Shares into a greater
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45
number of shares or (c) combines the outstanding Common Shares into a smaller
number of shares, then in each such case the amount set forth in the preceding
sentence with respect to the exchange or change of Junior Participating
Preferred Shares shall be adjusted by multiplying such amount 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.
Section 8. Redemption. The Junior Participating Preferred Shares shall
not be redeemable by the Corporation. The preceding sentence shall not be deemed
to limit the ability of the Corporation to purchase or otherwise deal in such
shares to the extent permitted by law.
Section 9. Ranking. The Junior Participating Preferred Shares shall
rank junior to all other series of the Corporation's series preferred stock
(whether with or without par value), including, but not limited to, the Series A
Cumulative Convertible Redeemable Preferred Stock, par value $0.01 per share,
the Series B Cumulative Convertible Redeemable Preferred Stock, par value $0.01
per share, and all other series of the Corporation's series preferred stock
ranking senior to or on a parity with such series of series preferred stock, as
to the payment of dividends and the distribution of assets, unless the terms of
any such series provide otherwise.
Section 10. Amendment. Neither the Corporation's Charter nor any
Articles Supplementary relating to the Junior Participating Preferred Shares
shall be amended in any manner which would materially and adversely alter or
change the preferences, rights or other terms of the Junior Participating
Preferred Shares without the affirmative vote of the holders of a majority or
more of the outstanding Junior Participating Preferred Shares, voting separately
as a class.
Section 11. Fractional Shares. Junior Participating Preferred Shares
may be issued in fractions of a share that are integral multiples of one
one-thousandth of a share, which shall entitle the holder, in proportion to such
holder's fractional shares, to exercise voting rights, receive dividends and
participate in distributions and to have the benefit of all other rights of
holders of Junior Participating Preferred Shares.
SECOND: The Junior Participating Preferred Shares have been classified
and designated by the Board under the authority contained in Article Fifth of
the Charter.
THIRD: These Articles Supplementary have been approved by the Board in
the manner and by the vote required by law.
FOURTH: The undersigned Executive Vice President of the Corporation
acknowledges these Articles Supplementary to be the act of the Corporation and,
as to all matters or facts required to be verified under oath, such officer
acknowledges that to the best of his knowledge, information and belief, these
matters and facts are true in all material respects and that this statement is
made under the penalties for perjury.
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IN WITNESS WHEREOF, the Corporation has caused these Articles
Supplementary to be signed in its name and on its behalf by its Executive Vice
President and attested to by its Secretary on this 5th day of May, 1999.
URBAN SHOPPING CENTERS, INC.
By:
-----------------------------------
Xxxx X. Xxxx
Executive Vice President
ATTEST:
-----------------------------------
Xxxxxxx Xxxxxxx
Secretary
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Exhibit B
[Form of Right Certificate]
Certificate No. R- ____________ Rights
NOT EXERCISABLE AFTER MAY 5, 2009 OR EARLIER IF THE RIGHTS EXPIRE UNDER
CERTAIN CIRCUMSTANCES OR ARE EXCHANGED OR REDEEMED BY THE COMPANY. THE
RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT
$0.01 PER RIGHT ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER
CERTAIN CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON
(AS SUCH TERM IS DEFINED IN THE RIGHTS AGREEMENT) AND ANY SUBSEQUENT
HOLDER OF SUCH RIGHTS MAY BECOME NULL AND VOID. [THE RIGHTS REPRESENTED
BY THIS CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON WHO WAS
OR BECAME AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE OF AN
ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT).
ACCORDINGLY, THIS RIGHT CERTIFICATE AND THE RIGHTS EVIDENCED HEREBY MAY
BECOME VOID IN THE CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF SUCH
AGREEMENT.]*
Right Certificate
URBAN SHOPPING CENTERS, INC.
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 May 5, 1999 (the "Rights Agreement"), between Urban
Shopping Centers, Inc., a Maryland corporation (the "Company"), and First
Chicago Trust Company of New York, as rights agent (the "Rights Agent"), to
purchase from the Company at any time after the Distribution Date (as such term
is defined in the Rights Agreement) and prior to 5:00 p.m. (Eastern time) on May
5, 2009 or notice of redemption or exchange at the office of the Rights Agent
(or its successors as Rights Agent) designated for such purpose, one
one-thousandth of a fully paid, non-assessable share of Junior Participating
----------
* The portion of the legend in brackets shall be inserted only
if applicable and shall replace the preceding sentence.
48
Preferred Shares (a "Preferred Share") of the Company, at a purchase price of
$128.00 per one one-thousandth of a Preferred Share (the "Purchase Price"), upon
presentation and surrender of this Right Certificate with the appropriate Form
of Election to Purchase and related Certificate duly executed. The number of
Rights evidenced by this Right Certificate (and the number of Preferred Shares
which may be purchased upon exercise thereof) set forth above, and the Purchase
Price per Preferred Share set forth above, are the number and Purchase Price as
of May 5, 1999, based on the Preferred Shares as constituted at such date.
Capitalized terms not defined in this Right Certificate that are defined in the
Rights Agreement shall have the meanings ascribed to them in the Rights
Agreement.
Upon the occurrence of a Triggering Event, if the Rights evidenced by
this Right Certificate are Beneficially Owned by (i) an Acquiring Person or an
Affiliate or Associate of any such Acquiring Person, (ii) under certain
circumstances specified in the Rights Agreement, a transferee of any such
Acquiring Person, Associate or Affiliate, or (iii) under certain circumstances
specified in the Rights Agreement, a transferee of a person who, after such
transfer, became an Acquiring Person, or an Affiliate or Associate of 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 any such Triggering Event.
As provided in the Rights Agreement, the Purchase Price and the number
and kind of Preferred Shares or other securities which may be purchased upon the
exercise of the Rights evidenced by this Right Certificate are subject to
modification and adjustment upon the happening of certain events.
This Right 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,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Right Certificates, which
limitations of rights include the temporary suspension of the exercisability of
such Rights under certain circumstances specified 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 Company.
This Right Certificate, with or without other Right Certificates, upon
surrender at the principal corporate trust office of the Rights Agent, may be
exchanged for another Right Certificate or Right Certificates of like tenor and
date evidencing Rights entitling the holder to purchase a like aggregate number
of Preferred Shares as the Rights evidenced by the Right Certificate or Right
Certificates surrendered entitled such holder to purchase. If this Right
Certificate is exercised in part, the holder is entitled to receive upon
surrender hereof another Right Certificate or Right Certificates for the number
of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced
by this Certificate may be redeemed by the Company at its option at a redemption
price of $0.01 per
2
49
Right at any time prior to the earlier of (i) such time as any Person becomes an
Acquiring Person or (ii) the close of business on the Final Expiration Date.
No fractional Preferred Shares 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 Preferred Share, which may, at the election
of the Company, be evidenced by depositary receipts), but in lieu thereof a cash
payment will be made, as provided in the Rights Agreement.
No holder of this Right Certificate, as such, is entitled to vote or
receive dividends or be deemed for any purpose the holder of Preferred Shares or
of any other securities of the Company which may at any time be issuable upon
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 stockholder of the Company or any right to vote for the election of
directors or upon any matter submitted to stockholders at any meeting thereof,
or to give or withhold consent to any corporate action, or, to receive notice of
meetings or other actions affecting stockholders (except as provided in the
Rights Agreement), or to receive dividends or subscription rights, or otherwise,
until the Right or Rights evidenced by this Right Certificate are exercised as
provided in the Rights Agreement.
This Right Certificate is not valid or obligatory for any purpose until
it has been countersigned by the Rights Agent.
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50
WITNESS the facsimile signature of the proper officers of the Company
and its seal.
Dated as of _________________ ______, ____________
URBAN SHOPPING CENTERS, INC.
By:
------------------------------
Name:
-----------------------------
Title:
----------------------------
Attest: (SEAL)
------------------------------------
Name:
Title:
Countersigned:
FIRST CHICAGO TRUST COMPANY OF NEW YORK
By:
------------------------------------
Authorized Signature
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51
[Form of Reverse Side of Right Certificate]
FORM OF ASSIGNMENT
(to be executed by the registered holder if such
holder desires to transfer the Right Certificate)
FOR VALUE RECEIVED _____________________________________________________________
hereby sells, assigns and transfers unto________________________________________
(please print name and address of transferee)
this Right Certificate, together with all right, title and interest therein, and
does hereby irrevocably constitute and appoint ___________________ Attorney, to
transfer the within Right Certificate on the books of the within-named Company,
with full power of substitution.
Date:_________________,_______ _____________________________
, 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
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 subsequently became an Acquiring Person or an
Affiliate or Associate of an Acquiring Person.
Date:_________________,_______ _____________________________
Signature
Notice
The signature to the foregoing Assignment and Certificate must
correspond to the name as written on the face of this Right Certificate in every
particular, without alteration or enlargement or any change whatsoever.
52
FORM OF ELECTION TO PURCHASE
----------------------------
(to be executed by the registered holder
if such holder desires to exercise Rights
evidenced by the Right Certificate)
To: URBAN SHOPPING CENTERS, INC.
The undersigned hereby irrevocably elects to exercise Rights evidenced
by this Right Certificate to purchase the Preferred Shares 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:
Please insert social security
or other identifying number:____________________________________________________
________________________________________________________________________________
(please print name and address)
If such number of Rights is not all the Rights evidenced by this Right
Certificate, a new Right Certificate for the balance of such Rights shall be
registered in the name of and delivered to:
Please insert social security
or other identifying number:____________________________________________________
________________________________________________________________________________
(please print name and address)
Date:_________________,_______ _____________________________
Signature
Signature Guaranteed:
53
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 subsequently became an Acquiring Person or an
Affiliate or Associate of an Acquiring Person.
Date:_________________,_______ _____________________________
Signature
Notice
The signature to the foregoing Election to Purchase and Certificate
must correspond to the name as written on the face of this Right Certificate in
every particular, without alteration or enlargement or any change whatsoever.
