Exhibit 1
TRANSFINANCIAL HOLDINGS, INC.
AND
UMB BANK, N.A.
RIGHTS AGENT
FIRST AMENDED
AND
RESTATED
RIGHTS AGREEMENT
DATED AS OF MARCH 4, 1999
TABLE OF CONTENTS
Section Page
1. Certain Definitions....................................................2
2. Appointment of Rights Agent...........................................11
3. Issue of Rights Certificates..........................................11
4. Form of Rights Certificates...........................................14
5. Countersignature and Registration.....................................15
6. Transfer, Split Up, Combination and Exchange
of Rights Certificates; Mutilated, Destroyed, Lost
or Stolen Rights Certificates..........................................16
7. Exercise of Rights; Purchase Price; Expiration
Date of Rights.........................................................17
8. Cancellation and Destruction of Rights Certificates....................20
9. Reservation and Availability of Capital Stock..........................20
10. Preferred Stock Record Date............................................22
11. Adjustment of Purchase Price, Number and Kind of
Shares or Number of Rights.............................................23
12. Certificate of Adjusted Purchase Price or Number
of Shares..............................................................34
13. Consolidation, Merger or Sale or Transfer of
Assets or Earning Power................................................34
14. Fractional Rights and Fractional Shares................................38
15. Rights of Action.......................................................40
16. Agreement of Rights Holders............................................40
17. Rights Certificate Holder Not Deemed a Stockholder.....................41
Section Page
18. Concerning the Rights Agent............................................42
19. Merger or Consolidation or Change of Name of
Rights Agent...........................................................42
20. Duties of Rights Agent.................................................43
21. Change of Rights Agent.................................................46
22. Issuance of New Rights Certificates....................................47
23. Redemption and Termination.............................................48
24. Exchange...............................................................49
25. Notice of Certain Events...............................................50
26. Notices................................................................52
27. Supplements and Amendments.............................................53
28. Successors.............................................................53
29. Determinations and Actions by the Board of
Directors, etc.........................................................53
30. Benefits of this Agreement.............................................54
31. Severability...........................................................54
32. Governing Law..........................................................54
33. Counterparts...........................................................55
34. Descriptive Headings...................................................55
EXHIBIT A Form of Certificate of Designations, Preferences and Rights of
Series A Preferred Stock
EXHIBIT B Form of Rights Certificate
EXHIBIT C Form of Summary of Rights
FIRST AMENDED
AND
RESTATED
RIGHTS AGREEMENT
THIS FIRST AMENDED AND RESTATED RIGHTS AGREEMENT, dated as of March 4,
1999 (the "Agreement"), is made between TransFinancial Holdings, Inc., a
Delaware corporation (the "Company"), and UMB Bank, N.A., a national banking
association, as agent (the "Rights Agent").
W I T N E S S E T H
WHEREAS, on July 14, 1998 (the "Rights Dividend Declaration Date"),
the Board of Directors of the Company authorized and declared a dividend
distribution of one Right (as hereinafter defined) for each share of Common
Stock (as hereinafter defined) of the Company outstanding at the close of
business on July 27, 1998 (the "Record Date"), and has authorized the issuance
of one such Right (subject to adjustment as hereinafter provided) for each share
of Common Stock of the Company issued or transferred by the Company between the
Record Date and the earlier of the Distribution Date (as hereinafter defined) or
the expiration or redemption of the Rights, and in certain circumstances, after
the Distribution Date, each such right initially representing the right to
purchase one one-hundredth of a share of Series A Preferred Stock of the Company
(subject to adjustment as hereinafter provided), having the rights, powers and
preferences set forth in the form of Certificate of Designations, Preferences
and Rights of Series A Preferred Stock filed with the Secretary of State of
Delaware on or about July 17, 1998, in substantially the form attached hereto as
Exhibit A, upon the terms and subject to the conditions hereinafter set forth
(the "Rights"); and
WHEREAS, on February 18, 1999, the Board of Directors, acting pursuant
to section 27 of the Rights Agreement dated as of July 14, 1998 (the "Initial
Rights Agreement"), approved this Agreement to amend and replace the Initial
Rights Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereby agree as follows:
SECTION 1. CERTAIN DEFINITIONS.
For purposes of this Agreement, the following terms have the meanings
indicated:
(a) "Acquiring Person" shall mean any Person who or which, together
with all Affiliates and Associates of such Person, without the Prior Written
Approval of the Company granted after the date hereof, shall be the Beneficial
Owner of 15% or more of the shares of Common Stock then outstanding, other than
as a result of a Qualifying Offer, whether or not such Person together with all
Affiliates and Associates of such Person continues to be the Beneficial Owner of
15% or more of such shares. Notwithstanding the foregoing,
(i) the term "Acquiring Person" shall not include any Exempt
Person (as hereinafter defined),
(ii) a Person shall not become an Acquiring Person solely as a
result of a reduction in the number of shares of Common Stock outstanding
due to the repurchase of shares of Common Stock by the Company, unless and
until such Person (together with all Affiliates and Associates of such
Person) shall purchase or otherwise become the Beneficial Owner of
additional shares of Common Stock, other than pursuant to a Qualifying
Offer or with the Prior Written Approval of the Company, and
(iii) notwithstanding any other provision hereof to the contrary,
a Person shall not be deemed to be an Acquiring Person if, within ten
Business Days after the Board of Directors is given written notice that
such Person has become an Acquiring Person, the Board of Directors
determines in good faith that such Person who would otherwise be an
"Acquiring Person" has become such inadvertently and the Board of Directors
provides such Person a period not to exceed thirty days to divest a
sufficient number of securities so that such Person would no longer be an
Acquiring Person, as defined in the foregoing provisions of this paragraph
(a), and such Person has so divested prior to the end of such period.
Notwithstanding anything in this Agreement to the contrary, the term "then
outstanding," when used with reference to a Person's beneficial ownership of
securities of the Company, shall mean 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.
(b) "Act" shall mean the Securities Act of 1933, as amended from time
to time.
(c) "Adjustment Shares" shall have the meaning set forth in Section
11(a)(ii) hereof.
(d) "Affiliate" shall have the meaning set forth in Rule 12b-2 of the
General Rules and Regulations under the Exchange Act as such Rule is in effect
on the date of this Agreement.
(e) "Associate" shall have the meaning set forth in Rule 12b-2 of the
General Rules and Regulations under the Exchange Act as such Rule is in effect
on the date of this Agreement.
(f) A Person shall be deemed the "Beneficial Owner" of, and shall be
deemed to "beneficially own," any securities:
(i) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has the right to vote or dispose of or
has "beneficial ownership" of (as determined pursuant to Rule 13d-3 of the
General Rules and Regulations under the Exchange Act as such Rule is in
effect on the date of this Agreement), including without limitation
pursuant to any agreement, arrangement or understanding, whether or not in
writing; provided, however, that a Person shall not be deemed the
"Beneficial Owner" of, or to "beneficially own," any security under this
subparagraph (i) as a result of an agreement, arrangement or understanding
to vote such security if such agreement, arrangement or understanding: (A)
arises solely from a revocable proxy given in response to a public proxy or
consent solicitation made pursuant to, and in accordance with, the
applicable provisions of the General Rules and Regulations under the
Exchange Act, and (B) is not also then reportable by such Person on
Schedule 13D under the Exchange Act (or any comparable or successor
report);
(ii) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has the right to acquire (whether such
right is exercisable immediately or only after the passage of time)
pursuant to any agreement, arrangement or understanding (whether or not in
writing), or upon the exercise of conversion rights, exchange rights,
rights, warrants or options, or otherwise; provided, however, that a Person
shall not be deemed under this paragraph (f) the "Beneficial Owner" of, or
to "beneficially own," (A) securities tendered pursuant to a tender or
-4-
exchange offer made by such Person or any of such Person's Affiliates or
Associates until such tendered securities are accepted for purchase or
exchange, or (B) securities issuable at any time prior to the occurrence of
a Triggering Event upon exercise of Rights (but only to the extent such
Rights have not been exercised and such securities have not been issued
upon exercise of such Rights), or (C) securities issuable from and after
the occurrence of a Triggering Event upon exercise of Rights, which Rights
were acquired by such Person or any of such Person's Affiliates or
Associates prior to the Distribution Date or pursuant to Section 3 or
Section 22 hereof (the "Original Rights") or pursuant to Section 11(i)
hereof in connection with an adjustment made with respect to any Original
Rights (but only to the extent such Rights have not been exercised and such
securities have not been issued upon exercise of such Rights);
(iii) which are beneficially owned, directly or indirectly, by
any other Person (or any Affiliate or Associate thereof) with which such
Person (or any of such Person's Affiliates or Associates) has any
agreement, arrangement or understanding (whether or not in writing), for
the purpose of acquiring, holding, voting (except as described in the
proviso to subparagraph (i) of this paragraph (f)) or disposing of any
voting securities of the Company.
Notwithstanding anything in this subparagraph (f) to the contrary, (x) no
member of a national securities exchange, pledgee of securities or person
engaged in business as an underwriter of securities shall be deemed to be
the "Beneficial Owner" of, or to "beneficially own," shares of Common Stock
to the extent provided in Rule 13d-3(d)(2), (3) and (4) of the General
Rules and Regulations under the Exchange Act as such Rule is in effect on
the date of this Agreement, (y) no Person who, immediately prior to the
Distribution Date, is a member of the Board of Directors or an officer of
the Company or who is an Affiliate or Associate of a member of the Board of
Directors or officer of the Company (each, an "Excluded Person") shall be
deemed to be the "Beneficial Owner" of, or to "beneficially own," shares of
Common Stock held by another Excluded Person solely by reason of any
agreement, arrangement or understanding, written or otherwise, entered into
in opposition to any transaction or in support of a Qualifying Offer, and
(z) no Excluded Person, no committee of Excluded Persons and no Person or
entity organized, appointed or established by the Company or any Subsidiary
for or pursuant to the terms of any employee benefit plan of the Company or
any Subsidiary shall be deemed to the "Beneficial Owner" of, or to
"beneficially own," securities held of record by any such plan or by the
trustee or administrator of any such plan pursuant to the terms of such
plan, except for shares allocated to the account of any Excluded Person
which may be voted or disposed of by such Excluded Person under the terms
of the Plan.
(g) "Board of Directors" shall mean the Board of Directors of the
Company as constituted from time to time, subject to the provisions of Sections
24 and 29 hereof.
(h) "Business Day" shall mean any day other than a Saturday, Sunday or
a day on which banking institutions in the State of New York, State of Missouri
or the State of Kansas are authorized or obligated by law or executive order to
close.
(i) "Close of business" on any given date shall mean 5:00 P.M., Kansas
City, Missouri time, on such date; provided, however, that if such date is not a
Business Day it shall mean 5:00 P.M., Kansas City, Missouri time, on the next
succeeding Business Day.
(j) "Closing Price" of a security (including without limitation the
Common Stock, the Preferred Stock and the Rights) for each day shall mean the
last sale price, regular way, or, in case no such sale takes place on such day,
the average of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on the American Stock Exchange or,
if the security is not listed or admitted to trading on the American Stock
Exchange, as reported in the principal consolidated transaction reporting system
with respect to securities listed on the principal national securities exchange
on which the security is listed or admitted to trading or, if the security is
not listed or admitted to trading on any national securities exchange, the
closing sale price or, if no sales were reported, the average of the closing bid
and asked prices in the over-the-counter market, as reported by The Nasdaq Stock
Market, of if not reported by The Nasdaq Stock Market, by such other self
regulatory organization or nationally recognized quotation service that then
reports information concerning such security as selected by the Board of
Directors, 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
of Directors. 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 of Directors shall be used.
(k) "Common Stock" shall mean the common stock, par value $.01 per
share, of the Company (or in the event of a subdivision, combination or
reclassification with respect to such shares of common stock, the shares of
common stock resulting from such subdivision, combination or reclassification);
except that "Common Stock" when used with reference to any Person other than the
Company shall mean the capital stock (or other equity securities or equity
interests) of such Person with the greatest voting power to control or direct
the management of such Person.
(l) "Common Stock Equivalents" shall have the meaning set forth in
Section 11(a)(iii) hereof.
(m) "Current Market Price" shall have the meaning set forth in Section
11(d) hereof.
(n) "Current Value" shall have the meaning set forth in Section
11(a)(iii) hereof.
(o) "Distribution Date" shall mean the earliest of (i) the close of
business on the Stock Acquisition Date (or, if the Stock Acquisition Date occurs
before the Record Date, the close of business on the Record Date), and (ii) the
close of business on the tenth Business Day (or such later date as the Board of
Directors shall determine prior to such time as any Person becomes an Acquiring
Person) after the date of the commencement by any Person (other than an Exempt
Person) of, or the first public announcement of the intention of such Person to
commence, a tender offer or exchange offer (other than a Qualifying Offer), the
consummation of which would result in any Person becoming an Acquiring Person;
provided however, that if a tender or exchange offer is terminated prior to the
occurrence of a Distribution Date, then no Distribution Date shall occur as a
result of such tender or exchange offer. In deferring the date set forth in
clause (ii) of the preceding sentence, the Board of Directors may defer such
date to a specified later date or to an unspecified later date to be determined
by a subsequent action or event.
(p) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended and in effect on the date of this Agreement.
(q) "Exchange Ratio" shall have the meaning set forth in Section 24(a)
hereof.
(r) "Exempt Person" shall mean (i) the Company, (ii) any Subsidiary of
the Company, (iii) any employee benefit plan of the Company or of any Subsidiary
of the Company or (iv) any Person organized, appointed or established by the
Company or any Subsidiary for or pursuant to the terms of any such plan (to the
extent then acting in such capacity).
(s) "Expiration Date" shall mean the earliest of (i) the Redemption
Date; (ii) the time at which such Rights are exchanged as provided in Section 24
hereof; (iii) the consummation of a transaction contemplated by Section 13(d)
hereof or (iv) the Final Expiration Date.
(t) "Final Expiration Date" shall mean the close of business on July
14, 2008.
(u) "Person" shall mean any individual, firm, corporation,
partnership, limited liability company, association, or other entity, and shall
include any successor (by merger or otherwise) of such entity.
(v) "Preferred Stock" shall mean shares of Series A Preferred Stock,
par value $.01 per share, of the Company (or in the event of a subdivision,
combination or reclassification with respect to such shares of Preferred Stock,
the shares of Preferred Stock resulting from such subdivision, combination or
reclassification), and, to the extent that there are not a sufficient number of
shares of Series A Preferred Stock authorized to permit the full exercise of the
Rights, any other series of preferred stock of the Company designated for such
purpose containing terms substantially similar to the terms of the Series A
Preferred Stock of the Company.
(w) "Principal Party" shall have the meaning set forth in Section
13(b) hereof.
(x) "Prior Written Approval" shall mean the prior express written
consent of the Company to any Person becoming an Acquiring Person, executed on
behalf of the Company by a duly authorized officer of the Company following
express approval by action of the Board of Directors, provided that all
conditions precedent and subsequent established by the Board of Directors (and
not waived by the Board of Directors prior to violation of any such condition)
in connection with such approval shall be satisfied.
(y) "Purchase Price" shall have the meaning set forth in Section 4(a)
hereof.
(z) "Qualifying Offer" shall mean an all-cash tender offer for all
outstanding shares of Common Stock which meets all of the following
requirements:
(i) the Person or group making the tender offer must, prior to
or upon commencing such offer, have provided to the Company firm written
commitments from responsible financial institutions, which have been
accepted by such Person or group, to provide funds for such offer, subject
only to customary terms and conditions (which shall in no event include
conditions requiring access by such financial institutions to non-public
information to be provided by the Company, conditions based on the accuracy
of any information concerning the Company other than such as would be the
subject of representations and warranties in a public financing by the
Company, or conditions requiring the Company to make any representations,
warranties or covenants in connection with such financing), and such funds,
when added to the amount of cash and cash equivalents which such Person or
group then has available and has irrevocably committed in writing to the
Company to maintain available for purposes of the offer if consummated, and
to set apart and maintain available for such purposes until the offer is
consummated or withdrawn, shall be sufficient to pay for all shares
outstanding on a fully diluted basis and all related expenses,
(ii) such Person or group must own, after consummating such
offer, at least a majority of the then outstanding shares of Common Stock,
(iii) the price per share offered in such offer must be at
least 15% above the highest Closing Price of the Common Stock during the
two (2) years preceding the commencement of the offer,
(iv) such offer must remain open for at least 60 Business Days
and must be extended for at least 20 Business Days after the last increase
in the price offered and after any bona fide higher alternative offer is
made and shall be subject only to customary terms and conditions, which
shall in no event include satisfaction of any conditions relating to the
business, financial condition, results of operations or prospects of the
Company other than such as are based on information publicly disclosed by
the Company, and
(v) prior to or upon commencing such offer, such Person or group
must irrevocably commit in writing to the Company and in the offer to
purchase relating to the offer:
(A) to consummate promptly upon completion of the
offer an all-cash transaction whereby all shares of Common Stock not
tendered into the offer will be acquired at the same price per share
paid pursuant to the offer, and otherwise not to purchase any shares
of Common Stock following completion of the offer,
(B) that such Person or group will not materially
amend such offer, except to increase the price offered, and
(C) that such Person of group will not make any offer
for any equity securities of the Company for six months after
commencement of the original offer if the original offer does not
result in the tender of the number of shares required to be purchased
pursuant to clause (ii) above, unless during such period another
tender offer for shares of Common Stock which meets the conditions for
a Qualifying Offer is commenced by another Person or Persons not
affiliated or associated with, acting in concert with, or instigated
or financed by, the Person or group making the original offer or with
whom the Person or group making the original offer has any agreement,
arrangement or understanding relating to the Company or any assets or
securities of it or any Subsidiary.
(aa) "Record Date" shall have the meaning set forth in the recital at
the beginning of this Agreement.
(bb) "Redemption Date" shall mean the time at which the Rights are
redeemed as provided in Section 23 hereof.
(cc) "Redemption Price" shall have the meaning set forth in Section
23(a) hereof.
(dd) "Rights" shall have the meaning set forth in the recital at the
beginning of this Agreement.
(ee) "Rights Certificates" shall mean the certificates evidencing the
Rights after the Distribution Date, which shall be substantially in the form
attached hereto as Exhibit B.
(ff) "Rights Dividend Declaration Date" shall have the meaning set
forth in the recital at the beginning of this Agreement.
(gg) "Section 11(a)(ii) Event" shall have the meaning set forth in
Section 11(a)(ii) hereof.
(hh) "Section 13 Event" shall mean any event described in clauses (i),
(ii) or (iii) of Section 13(a) hereof.
(ii) "Spread" shall have the meaning set forth in Section 11(a)(iii)
hereof.
(jj) "Stock Acquisition Date" shall mean the earlier of the date of
(i) the first public announcement (which, for purposes of this definition, shall
include, without limitation, a report filed under the Exchange Act) by the
Company or an Acquiring Person that an Acquiring Person has become such or (ii)
the first public disclosure of facts by the Company or an Acquiring Person
indicating that an Acquiring Person has become an Acquiring Person, provided
that if such Person is determined not to have become an Acquiring Person
pursuant to Section 1(a) hereof, no Stock Acquisition Date shall be deemed to
have occurred.
(kk) "Subsidiary" shall mean, with reference to any Person, any other
Person of which an amount of voting securities sufficient to elect at least a
majority of the directors or Persons having similar authority of such other
Person is beneficially owned, directly or indirectly, by such Person, or
otherwise controlled by such Person.
(ll) "Substitution Period" shall have the meaning set forth in Section
11(a)(iii) hereof.
(mm) "Summary of Rights" shall have the meaning set forth in Section
3(b) hereof.
(nn) "Trading Day" shall mean a day on which the principal national
securities exchange on which the shares of Common Stock are listed or admitted
to trading is open for the transaction of business or, if the shares of Common
Stock are not listed or admitted to trading on any national securities exchange,
a Business Day.
(oo) "Triggering Event" shall mean any Section 11(a)(ii) Event or any
Section 13 Event.
SECTION 2. APPOINTMENT OF RIGHTS AGENT.
The Company hereby appoints the Rights Agent to act as agent for the
Company and the record holders of the Rights (who, in accordance with Section 3
hereof, shall prior to the Distribution Date also be the holders of the Common
Stock) in accordance with the terms and conditions hereof, and the Rights Agent
hereby accepts such appointment. The Company may from time to time appoint such
Co-Rights Agents as it may deem necessary or desirable.
SECTION 3. ISSUE OF RIGHTS CERTIFICATES.
(a) Until the earlier of Distribution Date or the Expiration Date,
(i) the Rights will be evidenced (subject to the provisions of Section 3(b)) by
the certificates for the Common Stock registered in the names of the holders of
the Common Stock (which certificates for Common Stock shall be deemed also to be
certificates for Rights) and not by separate certificates, (ii) the registered
holders of Common Stock shall also be the registered holders of the associated
Rights, (iii) the Rights will be transferable only in connection with the
transfer of the underlying shares of Common Stock (including a transfer to the
Company) and (iv) the transfer of any such certificate shall also constitute the
transfer of the Rights associated with the Common Stock represented by such
certificate.
(b) On the Record Date, or as soon as practicable thereafter, the
Company will send a copy of a Summary of Rights, in substantially the form
attached hereto as Exhibit C (the "Summary of Rights"), by first-class, postage
prepaid mail, to each record holder of the Common Stock as of the close of
business on the Record Date, at the address of such holder shown on the records
of the Company. With respect to certificates for the Common Stock outstanding
as of the Record Date, until the earlier of the Distribution Date or the
Expiration Date, the Rights will be evidenced by such certificates together with
a copy of the Summary of Rights, and the registered holders of the shares of
Common Stock represented by the certificates shall also be the registered
holders of the Rights. Until the earlier of the Distribution Date or the
Expiration Date, the surrender for transfer of any such certificate, with or
without a copy of the Summary of Rights attached thereto, shall also constitute
the transfer of the Rights associated with the Common Stock represented by such
certificate, and any certificate newly issued pursuant to such transfer shall
bear the legend set forth in Section 3(d) hereof.
(c) Rights shall be issued in respect of all shares of Common Stock
which are issued (whether originally issued or transferred from the Company's
treasury to any other Person) after the Record Date but prior to the earlier of
the Distribution Date or the Expiration Date, or, in certain circumstances
provided in Section 22 hereof, after the Distribution Date, except with respect
to dividends on the outstanding shares of Common Stock payable in shares of
Common Stock as provided in Section 11(p) hereof. Certificates representing
such shares of Common Stock with respect to which Rights are issued on or after
the Record Date and prior to the earlier of the Distribution Date or Expiration
Date shall also be deemed to be certificates for Rights, and shall bear the
legend set forth in Section 3(d).
(d) Certificates for shares of Common Stock which are issued after
the Record Date and prior to the earlier of the Distribution Date or the
Expiration Date shall bear the following legend:
This certificate also evidences and entitles the holder hereof to
certain Rights as set forth in the Rights Agreement (the "Rights
Agreement"), between TransFinancial Holdings, Inc. (the "Company") and
UMB Bank, N.A. (the "Rights Agent"), the terms of which are hereby
incorporated herein by reference and a copy of which is on file at the
principal offices of the Rights Agent. Under certain circumstances,
as set forth in the Rights Agreement, such Rights will be evidenced by
separate certificates and will no longer be evidenced by this
certificate. The Company will mail to the holder of this certificate
a copy of the Rights Agreement, 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 any 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, may become null and
void.
Notwithstanding this paragraph (d), the omission of a legend shall not affect
the enforceability of any part of this Rights Agreement or the rights of any
holder of the Rights.
(e) In the event that the Company purchases or otherwise acquires any
shares of Common Stock after the Record Date but prior to the Distribution Date,
any Rights associated with such shares of Common Stock shall be deemed canceled
and retired so that the Company shall not be entitled to exercise any Rights
associated with the shares of Common Stock which are no longer outstanding.
(f) As soon as practicable after the Distribution Date, the Company
shall prepare and execute and the Rights Agent will countersign and send by
first-class, insured, postage prepaid mail, to each record holder of the Common
Stock as of the close of business on the Distribution Date, at the address of
such holder shown on the records of the Company, one or more Rights
Certificates, evidencing one Right for each share of Common Stock so held,
subject to adjustment as provided herein. In the event that an adjustment in
the number of Rights per share of Common Stock has been made pursuant to Section
11(p) hereof, at the time of distribution of the Rights Certificates, the
Company may make appropriate rounding adjustments (in accordance with Section
14(a) hereof) so that Rights Certificates representing only whole numbers of
Rights are distributed and cash is paid in lieu of any fractional Rights. As of
and after the Distribution Date, the Rights will be evidenced solely by such
Rights Certificates.
SECTION 4. FORM OF RIGHTS CERTIFICATES.
(a) The Rights Certificates (and the forms of election to purchase
and of assignment to be printed on the reverse thereof) shall each be
substantially in the form set forth in 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, rule or regulation or with any rule or regulation of any stock
exchange or interdealer quotation system on which the Rights may from time to
time be listed or quoted, or to conform to usage. Subject to the provisions of
Section 11 and Section 22 hereof, the Rights Certificates, whenever distributed,
shall entitle the holders thereof to purchase such number of one one-hundredths
of a share of Preferred Stock as shall be set forth therein at the price set
forth therein (such exercise price per one one-hundredth of a share, 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 Rights Certificate issued pursuant to Section 3(f) or Section
22 hereof that represents Rights beneficially owned by: (i) an Acquiring Person
or any 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 such, or (iii) a transferee of an
Acquiring Person (or of any such Associate or Affiliate) who becomes a
transferee prior to or concurrently with the Acquiring Person becoming such and
receives such Rights pursuant to either (A) a transfer (whether or not for
consideration) from the Acquiring Person to holders of equity interests in such
Acquiring Person or to any Person with whom such Acquiring Person has any
continuing agreement, arrangement or understanding regarding the transferred
Rights or (B) a transfer which the Board of Directors has determined is part of
a plan, arrangement or understanding which has as a primary purpose or effect
avoidance of Section 7(e) hereof, and any Rights Certificate issued pursuant to
Section 6 or Section 11 hereof upon transfer, exchange, replacement or
adjustment of any other Rights Certificate referred to in this sentence, shall
contain (to the extent feasible) the following legend:
The Rights represented by this Rights Certificate are or were
beneficially owned by a Person who was or subsequently became an
Acquiring Person or an Affiliate or Associate of an Acquiring Person
(as such terms are defined in the Rights Agreement). Accordingly,
this Rights Certificate and the Rights represented hereby may become,
or may already have become, null and void in the circumstances
specified in Section 7(e) of such Agreement.
The provisions of Section 7(e) of this Agreement shall be operative whether or
not the foregoing legend is contained on any such Rights Certificate. The
Company shall give notice to the Rights Agent promptly after it becomes aware of
the existence of any Acquiring Person or any Associate or Affiliate thereof.
SECTION 5. COUNTERSIGNATURE AND REGISTRATION.
(a) The Rights Certificates shall be executed on behalf of the
Company by its Chairman of the Board, any Vice Chairman, its President or any
Vice President, either manually or by facsimile signature, and shall have
affixed thereto the Company's seal or a facsimile thereof which shall be
attested by the Secretary or an Assistant Secretary of the Company, either
manually or by facsimile signature. The Rights Certificates shall be
countersigned by an authorized signatory of the Rights Agent, either manually or
by facsimile signature, and shall not be valid for any purpose unless so
countersigned. In case any officer of the Company whose manual or facsimile
signature is affixed to any of the Rights Certificates shall cease to be such
officer of the Company before countersignature by the Rights Agent and issuance
and delivery by the Company, such Rights Certificates, nevertheless, may be
countersigned by an authorized signatory of the Rights Agent and issued and
delivered by the Company with the same force and effect as though the person who
signed such Rights Certificates had not ceased to be such officer of the
Company. Any Rights Certificate may be signed on behalf of the Company by any
person who, at the actual date of the execution of such Rights Certificate,
shall be a proper officer of the Company to sign such Rights Certificate,
although at the date of the execution of this Rights Agreement any such person
was not such an officer.
(b) Following the Distribution Date, the Rights Agent will keep or
cause to be kept, at its principal office or offices designated as the
appropriate place for surrender of Rights Certificates upon exercise or
transfer, books for registration and transfer of the Rights Certificates issued
hereunder. Such books shall show the names and addresses of the respective
record holders of the Rights Certificates, the number of Rights evidenced on its
face by each of the Rights Certificates and the date of each of the Rights
Certificates.
SECTION 6. TRANSFER, SPLIT UP, COMBINATION AND EXCHANGE OF RIGHTS
CERTIFICATES; MUTILATED, DESTROYED, LOST OR STOLEN
RIGHTS CERTIFICATES.
(a) Subject to the provisions of Section 4(b), Section 7(e) and
Section 14 hereof, at any time after the close of business on the Distribution
Date, and at or prior to the close of business on the Expiration Date, any
Rights Certificate or Certificates may be transferred, split up, combined or
exchanged for another Rights Certificate or Certificates, entitling the
registered holder to purchase a like number of one one-hundredths of a share of
Preferred Stock (or Common Stock, other securities, cash or other assets, as the
case may be) as the Rights Certificate or Certificates surrendered then entitled
such holder (or former holder in the case of a transfer) to purchase. Any
registered holder desiring to transfer, split up, combine or exchange any Rights
Certificate or Certificates shall make such request in writing delivered to the
Rights Agent, and shall surrender the Rights Certificate or Certificates to be
transferred, split up, combined or exchanged at the principal office or offices
of the Rights Agent designated for such purpose. Neither the Rights Agent nor
the Company shall be obligated to take any action whatsoever with respect to the
transfer of any such surrendered Rights Certificate until the registered holder
shall have completed and signed the certificate contained in the form of
assignment on the reverse side of such Rights Certificate and shall have
provided such additional evidence of the identity of the Beneficial Owner (or
former Beneficial Owner) or Affiliates or Associates thereof as the Company
shall reasonably request. Thereupon the Rights Agent shall, subject to Section
4(b), Section 7(e) and Section 14 hereof, countersign and deliver to the Person
entitled thereto a Rights Certificate or Rights Certificates, as the case may
be, as so requested. The Company may require payment of a sum sufficient to
cover any tax or governmental charge that may be imposed in connection with any
transfer, split up, combination or exchange of Rights Certificates.
(b) Subject to the provision of Section 4(b), Section 7(e) and
Section 14 hereof, upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction or mutilation of
a Rights Certificate, and, in case of loss, theft or destruction, of indemnity
or security reasonably satisfactory to them, and reimbursement to the Company
and the Rights Agent of all reasonable expenses incidental thereto, and upon
surrender to the Rights Agent and cancellation of the Rights Certificate if
mutilated, the Company will execute and deliver a new Rights Certificate of like
tenor to the Rights Agent for countersignature and delivery to the registered
owner in lieu of the Rights 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
Rights Certificate may exercise the Rights evidenced thereby (except as
otherwise provided herein including, without limitation, the restrictions on
exercisability set forth in Section 9(c), Section 11(a)(iii) and Section 24(b)
hereof) in whole or in part at any time after the Distribution Date and at or
prior to the Expiration Date, upon surrender of the Rights Certificate, with the
form of election to purchase and the certificate on the reverse side thereof
duly executed, to the Rights Agent at the principal office or offices of the
Rights Agent designated for such purpose, along with a signature guarantee and
such other and further documentation as the Rights Agent may reasonably request,
together with payment of the aggregate Purchase Price with respect to the total
number of one one-hundredths of a share of Preferred Stock (or other securities,
cash or other assets, as the case may be) as to which such surrendered Rights
are then exercisable.
(b) The Purchase Price for each one one-hundredth of a share of
Preferred Stock pursuant to the exercise of a Right shall initially be $50.00,
and shall be subject to adjustment from time to time as provided in Sections 11
and 13(a) hereof and shall be payable in lawful money of the United States of
America in accordance with paragraph (c) below.
(c) Upon receipt of a Rights Certificate representing exercisable
Rights, with the form of election to purchase and the certificate duly executed,
accompanied by payment, with respect to each Right so exercised, of the Purchase
Price per one one-hundredth of a share of Preferred Stock (or other shares,
securities, cash or other assets, as the case may be) to be purchased as set
forth below and an amount equal to any applicable transfer tax required to be
paid by the holder of such Rights Certificate in accordance with Section 9
hereof, the Rights Agent shall, subject to Section 20(k) hereof, thereupon
promptly (i) (A) requisition from any transfer agent of the shares of Preferred
Stock (or make available, if the Rights Agent is the transfer agent for such
shares) certificates for the total number of one one-hundredths of a share of
Preferred Stock to be purchased and the Company hereby irrevocably authorizes
its transfer agent to comply with all such requests, or (B) if the Company shall
have elected to deposit the total number of shares of Preferred Stock issuable
upon exercise of the Rights hereunder with a depositary agent, requisition from
the depositary agent depositary receipts representing such number of one one-
hundredths of a share of Preferred Stock as are to be purchased (in which case
certificates for the shares of Preferred Stock represented by such receipts
shall be deposited by the transfer agent with the depositary agent) and the
Company will direct the depositary agent to comply with such request, (ii)
requisition from the Company the amount of cash, if any, to be paid in lieu of
fractional shares in accordance with Section 14 hereof, (iii) promptly 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 Rights
Certificate, registered in such name or names as may be designated by such
holder, and (iv) after receipt thereof, promptly deliver such cash, if any, to
or upon the order of the registered holder of such Rights Certificate. The
payment of the Purchase Price (as such amount may be reduced pursuant to Section
11(a)(iii) hereof) shall be made in cash or by certified check, cashier's check
or money order payable to the order of the Company. In the event that the
Company is obligated to issue other securities (including Common Stock) of the
Company, pay cash and/or distribute other property pursuant to Section 11(a)
hereof, the Company will make all arrangements necessary so that such other
securities, cash and/or other property are available for distribution by the
Rights Agent, if and when appropriate. The Company reserves the right to
require, prior to the occurrence of a Triggering Event, that upon any exercise
of Rights, a number of Rights be exercised so that only whole shares of
Preferred Stock would be issued.
(d) In case the registered holder of any Rights Certificate shall
exercise less than all the Rights evidenced thereby, a new Rights Certificate
evidencing Rights equivalent to the Rights remaining unexercised shall be issued
by the Rights Agent and delivered to, or upon the order of, the registered
holder of such Rights Certificate, registered in such name or names as may be
designated by such holder, subject to the provisions of Section 14 hereof.
(e) Notwithstanding anything in this Agreement to the contrary, from
and after the first occurrence of a Section 11(a)(ii) 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 such, or (iii) a transferee of an Acquiring Person (or of any such
Associate or Affiliate) who becomes a transferee prior to or concurrently with
the Acquiring Person becoming such and receives such Rights pursuant to either
(A) a transfer (whether or not for consideration) from 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
regarding the transferred Rights or (B) a transfer which the Board of Directors
has determined is part of a plan, arrangement or understanding which has as a
primary purpose or effect the avoidance of this Section 7(e), shall become null
and void without any further action and no holder of such Rights shall have any
rights whatsoever with respect to such Rights, whether under any provision of
this Agreement or otherwise. The Company shall use all reasonable efforts to
ensure that the provisions of this Section 7(e) and Section 4(b) hereof are
complied with, but neither the Company nor the Rights Agent shall have any
liability to any holder of Rights Certificates or other Person as a result of
the Company's failure to make any determinations with respect to an Acquiring
Person or its Affiliates, Associates or transferees hereunder. The Company may
require (or cause the Rights Agent or any transfer agent of the Company to
require) any Person who submits a Rights Certificate (or a certificate
representing shares of Common Stock that evidences, or but for the provisions of
this Section 7(e) would evidence, Rights) for transfer on the registry books or
to exercise the Rights represented thereby to establish to the satisfaction of
the Company in its sole discretion that such Rights have not become null and
void pursuant to the provisions of this Section 7(e).
(f) Notwithstanding anything in this Agreement to the contrary,
neither the Rights Agent nor the Company shall be obligated to undertake any
action with respect to a registered holder upon the occurrence of any purported
exercise as set forth in this Section 7 unless such registered holder shall have
(i) completed and signed the certificate contained in the form of election to
purchase set forth on the reverse side of the Rights Certificate surrendered for
such exercise, and (ii) provided such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates
thereof as the Company shall reasonably request.
SECTION 8. CANCELLATION AND DESTRUCTION OF RIGHTS CERTIFICATES.
All Rights Certificates surrendered for the purpose of exercise,
transfer, split up, combination or exchange shall, if surrendered to the Company
or any of its agents, be delivered to the Rights Agent for cancellation or in
canceled form, or, if surrendered to the Rights Agent, shall be canceled by it,
and no Rights Certificates shall be issued in lieu thereof except as expressly
permitted by any of the provisions of this Agreement. The Company shall deliver
to the Rights Agent for cancellation and retirement, and the Rights Agent shall
so cancel and retire, any other Rights Certificate purchased or acquired by the
Company otherwise than upon the exercise thereof. The Rights Agent shall
deliver all canceled Rights Certificates to the Company, or shall, at the
written request of the Company, destroy such canceled Rights Certificates, and
in such case shall deliver a certificate of destruction thereof to the Company.
SECTION 9. RESERVATION AND AVAILABILITY OF CAPITAL
STOCK.
(a) The Company covenants and agrees that it will cause to be
reserved and kept available out of its authorized and unissued shares of
Preferred Stock (and, following the occurrence of a Triggering Event, out of its
authorized and unissued shares of Common Stock and/or other securities or out of
its authorized and issued shares held in its treasury), the number of shares of
Preferred Stock (and, following the occurrence of a Triggering Event, Common
Stock and/or other securities) that, as provided in this Agreement, including
Section 11(a)(iii) hereof, will be sufficient to permit the exercise in full of
all outstanding Rights.
(b) So long as the shares of Preferred Stock (and, following the
occurrence of a Triggering Event, Common Stock and/or other securities) issuable
and deliverable upon the exercise of the Rights may be listed on any national
securities exchange or quoted on any interdealer quotation system or by any
nationally recognized quotation service, the Company shall use its best efforts
to cause, from and after such time as the Rights become exercisable (but only to
the extent that it is reasonably likely that the Rights will be exercised), all
shares reserved for such issuance to be so listed or quoted upon official notice
of issuance upon such exercise.
(c) The Company shall use its best efforts to (i) file, as soon as
practicable following the earliest date after the first occurrence of a Section
11(a)(ii) Event on which the consideration to be delivered by the Company upon
exercise of the Rights has been determined in accordance with Section 11(a)(iii)
hereof, a registration statement under the 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 Act) until the earlier
of (A) the date as of which the Rights are no longer exercisable for such
securities, and (B) the Expiration Date. The Company will also take such action
as may be appropriate under, or to ensure compliance with, the securities or
"blue sky" laws of the various states in connection with the exercisability of
the Rights. The Company may temporarily suspend, for a period of time not to
exceed ninety (90) days after the date set forth in clause (i) of the first
sentence of this Section 9(c), the exercisability of the Rights in order to
prepare and file such registration statement and permit it to become effective.
Upon any such suspension, the Company shall make a public announcement stating
that the exercisability of the Rights has been temporarily suspended, as well as
a public announcement at such time as the suspension is no longer in effect. In
addition, if the Company shall determine that a registration statement is
required following the Distribution Date, the Company may temporarily suspend
the exercisability of the Rights until such time as a registration statement has
been declared effective. Notwithstanding any provision of this Agreement to the
contrary, the Rights shall not be exercisable in any jurisdiction if the
requisite qualification in such jurisdiction shall not have been obtained, the
exercise thereof shall not be permitted under applicable law or a registration
statement (if required) shall not have been declared effective.
(d) The Company covenants and agrees that it will take all such
action as may be necessary to ensure that all Preferred Stock (and, following
the occurrence of a Triggering Event, Common Stock and/or other securities)
delivered upon exercise or exchange of the Rights shall, at the time of delivery
of the certificates for such shares (subject to payment of the Purchase Price),
be duly and validly authorized and issued and fully paid and nonassessable,
including, without limitation, effecting such changes to the accounts of the
Company as may be necessary to accomplish the foregoing purposes.
(e) The Company further covenants and agrees that it will pay when
due and payable any and all federal and state transfer taxes and charges which
may be payable in respect of the issuance or delivery of the Rights Certificates
and of any certificates for Preferred Stock (or Common Stock 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 Rights Certificates to a Person other
than, or the issuance or delivery of certificates or depositary receipts for a
number of one one-hundredths of a share of Preferred Stock (or Common Stock
and/or other securities, as the case may be) in respect of a name other than
that of, the registered holder of the Rights Certificates evidencing Rights
surrendered for exercise or to issue or deliver any certificates or depositary
receipts for a number of one one-hundredths of a share of Preferred Stock (or
Common Stock and/or other securities, as the case may be) in a name other than
that of the registered holder upon the exercise of any Rights until such tax
shall have been paid (any such tax being payable by the holder of such Rights
Certificate at the time of surrender) or until it has been established to the
Company's satisfaction that no such tax is due.
SECTION 10. PREFERRED STOCK RECORD DATE.
Each person in whose name any certificate for Preferred Stock (or
Common Stock and/or other securities, as the case may be) is issued upon the
exercise of Rights shall for all purposes be deemed to have become the holder of
record of such Preferred Stock (or Common Stock and/or other securities, as the
case may be) represented thereby on, and such certificate shall be dated, the
date upon which the Rights Certificate evidencing such Rights was duly
surrendered and payment of the aggregate Purchase Price attributable to the
Right (and all applicable transfer taxes) was made; provided, however, that if
the date of such surrender and payment is a date upon which the Preferred Stock
(or Common Stock and/or other securities, as the case may be) transfer books of
the Company are closed, such Person shall be deemed to have become the record
holder of such shares (fractional or otherwise) on, and such certificate shall
be dated, the next succeeding Business Day on which the Preferred Stock (or
Common Stock and/or other securities, as the case may be) transfer books of the
Company are open. Prior to the exercise of the Rights evidenced thereby, the
holder of a Rights Certificate shall not be entitled to any rights of a
stockholder of the Company with respect to shares for which the Rights shall be
exercisable, including, without limitation, the right to vote, to receive
dividends or other distributions or to exercise any preemptive rights, and shall
not be entitled to receive any notice of any proceedings of the Company, except
as provided herein.
SECTION 11. ADJUSTMENT OF PURCHASE PRICE, NUMBER AND KIND OF SHARES
OR NUMBER OF RIGHTS.
The Purchase Price, the number and kind of 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) In the event the Company shall at any time after the date of
this Agreement (A) declare and pay a dividend on the Preferred Stock payable in
shares of Preferred Stock, (B) subdivide the outstanding Preferred Stock, (C)
combine the outstanding Preferred Stock into a smaller number of shares, or (D)
issue any shares of its capital stock in a reclassification of the Preferred
Stock (including any such reclassification in connection with a consolidation or
merger in which the Company is the continuing or surviving corporation), except
as otherwise provided in this Section 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 Preferred Stock or capital stock, as the case may
be, issuable on such date, shall be proportionately adjusted so that the holder
of any Right exercised after such time shall be entitled to receive, upon
payment of the aggregate Purchase Price attributable to the Right, the aggregate
number and kind of shares of Preferred Stock or capital stock, as the case may
be, which, if such Right had been exercised immediately prior to such date and
at a time when the Preferred Stock transfer books of the Company were open, the
holder would have owned upon such exercise and been entitled to receive by
virtue of such dividend, subdivision, combination or reclassification. Such
adjustment shall be made successively whenever such an event occurs. 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 hereof, in the event any Person, shall, at
any time after the close of business on the Rights Dividend Declaration Date,
become an Acquiring Person, unless such person becomes an Acquiring Person
pursuant to a transaction set forth in Section 13(a) hereof (such an event being
referred to herein as a "Section 11(a)(ii) Event") then, promptly following the
occurrence of such Section 11(a)(ii) Event, proper provision shall be made so
that each holder of a Right (except as provided below and in Section 7(e)
hereof) shall thereafter have the right to receive, upon exercise thereof in
accordance with the terms of this Agreement, in lieu of a number of one one-
hundredths of a share of Preferred Stock (as previously adjusted), such number
of shares of Common Stock of the Company as shall equal the result obtained by
(x) multiplying the then current Purchase Price by the then number of one one-
hundredths of a share of Preferred Stock (as previously adjusted) for which a
Right was exercisable immediately prior to the first occurrence of a Section
11(a)(ii) Event, and (y) dividing that product (the "Aggregate Purchase Price")
by 50% of the Current Market Price (determined pursuant to Section 11(d) hereof)
per share of Common Stock on the date of such first occurrence (such number of
shares, the "Adjustment Shares"). Upon such occurrence, the Purchase Price per
share of Common Stock shall equal the Aggregate Purchase Price applicable to the
Right divided by the number of Adjustment Shares subject to the Right, subject
to further adjustment as appropriate in accordance with Section 11(f) hereof.
(iii) In the event that the number of shares of Common Stock which are
authorized by the Company's certificate of incorporation but not outstanding or
reserved for issuance for purposes other than upon exercise of the Rights are
not sufficient to permit the exercise in full of the Rights in accordance with
the foregoing subparagraph (ii) of this Section 11(a), the Company shall (A)
determine the excess of (1) the value of the Adjustment Shares issuable upon the
exercise of a Right determined as set forth below (the "Current Value") over (2)
the Aggregate Purchase Price attributable to such Right (such excess is referred
to herein as the "Spread"), and (B) with respect to each Right (subject to
Section 7(e) hereof), make adequate provision to substitute for the Adjustment
Shares, upon the exercise of a Right and payment of the applicable Aggregate
Purchase Price, (1) cash, (2) a reduction in the Aggregate Purchase Price
payable, (3) shares of Common Stock or other equity securities of the Company
(including, without limitation, shares, or units or fractions of shares, of
preferred stock, such as the Preferred Stock, which, by virtue of having
dividend, voting and liquidation rights substantially comparable to those of
Common Stock, are deemed in good faith by the Board of Directors to have
essentially the same value as shares of Common Stock (such shares or units or
fractions of shares of preferred stock being referred to as "Common Stock
Equivalents")), (4) debt securities of the Company, (5) other assets, or (6) any
combination of the foregoing, having an aggregate value equal to the Current
Value, where such aggregate value has been determined by the Board of Directors
based upon the advice of a nationally recognized investment banking firm
selected in good faith by the Board of Directors; provided, however, that if the
Company shall not have made adequate provision to deliver value pursuant to
clause (B) above within thirty days after the date on which the Section
11(a)(ii) Event occurs, then the Company shall be obligated to deliver, upon the
surrender for exercise of a Right and without requiring payment of the Aggregate
Purchase Price (other than an amount equal to the par value of the shares of
Common Stock to be issued), shares of Common Stock (to the extent available),
and then, if necessary, shares or fractions or units of shares of Preferred
Stock (to the extent available), and then, if necessary, Common Stock
Equivalents (to the extent available) and then, if necessary, cash, which
shares, fractions or units of shares and/or cash have an aggregate value equal
to the Spread (plus any amount paid for the shares). If the Board of Directors
determines in good faith that it is likely that sufficient additional shares of
Common Stock could be authorized for issuance upon exercise in full of the
Rights, the thirty day period set forth above may be extended to the extent
necessary, but not more than ninety days after the date the Section 11(a)(ii)
Event occurs, in order that the Company may seek shareholder approval for the
authorization of such additional shares (such thirty day period, as it may be
extended, is herein called the "Substitution Period"). To the extent that
action is to be taken pursuant to the first and/or second sentences of this
Section 11(a) (iii), the Company (X) shall provide, subject to Section 7(e)
hereof, that such action shall apply uniformly to all outstanding Rights to the
extent possible, and (Y) may suspend the exercisability of the Rights until the
expiration of the Substitution Period in order to seek such shareholder approval
for such authorization of additional shares and/or to decide the appropriate
form of distribution to be made pursuant to such first sentence and to determine
the value thereof. In the event of any such suspension, the Company shall make
a public announcement stating that the exercisability of the Rights has been
temporarily suspended, as well as a public announcement at such time as the
suspension is no longer in effect. For purposes of this Section 11(a)(iii), the
Current Value of each Adjustment Share shall be the Current Market Price (as
determined pursuant to Section 11(d) hereof) per share of the Common Stock on
the date the Section 11(a)(ii) Event occurs. For purposes of this Section
11(a)(iii), the per share or per unit value of any share of Common Stock or
Common Stock Equivalent to be delivered pursuant to this Section 11(a)(iii)
shall be deemed to equal the Current Market Price (as determined pursuant to
Section 11(d) hereof) per share of the Common Stock on the date the Section
11(a)(ii) Event occurs, subject to adjustment as appropriate in accordance with
Section 11(f) hereof.
(b) In case the Company shall fix a record date for the issuance of
rights, options or warrants to all holders of Preferred Stock entitling them to
subscribe for or purchase (for a period expiring within sixty (60) calendar days
after such record date) Preferred Stock (or shares having the same rights,
privileges and preferences as the shares of Preferred Stock ("Equivalent
Preferred Stock")) or securities convertible into Preferred Stock or Equivalent
Preferred Stock at a price per share of Preferred Stock or per share of
Equivalent Preferred Stock (or having a conversion price per share, if a
security convertible into Preferred Stock or Equivalent Preferred Stock) less
than the Current Market Price (as determined pursuant to Section 11(d) hereof)
per share of Preferred Stock 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 shares of Preferred Stock outstanding
on such record date, plus the number of shares of Preferred Stock and Equivalent
Preferred Stock which the aggregate offering price of the total number of shares
of Preferred Stock and/or Equivalent Preferred Stock so to be offered (and/or
the aggregate initial conversion price of the convertible securities so to be
offered) would purchase at such Current Market Price, and the denominator of
which shall be the number of shares of Preferred Stock outstanding on such
record date, plus the number of additional shares of Preferred Stock and/or
Equivalent Preferred Stock to be offered for subscription or purchase (or into
which the convertible securities so to be offered are initially convertible).
In case such subscription price may be paid by delivery of consideration part or
all of which may be in a form other than cash, the value of such consideration
shall be as determined in good faith by the Board of Directors, whose
determination shall be described in a statement filed with the Rights Agent.
Shares of Preferred Stock and Equivalent Preferred Stock owned by or held for
the account of the Company shall not be deemed outstanding for the purpose of
any such computation. Such adjustment shall be made successively whenever such
a record date is fixed, and in the event that such rights, options or warrants
are not so issued, the 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) In case the Company shall fix a record date for a distribution to
all holders of Preferred Stock (including any such distribution made in
connection with a consolidation or merger in which the Company is the continuing
or surviving corporation) of evidences of indebtedness, cash (other than a
regular quarterly cash dividend out of the earnings or retained earnings of the
Company), assets (other than a dividend payable in Preferred Stock, but
including any dividend payable in stock other than Preferred Stock) or
subscription rights, options or warrants (excluding those referred to in Section
11(b) hereof), the Purchase Price to be in effect after such record date shall
be determined by multiplying the Purchase Price in effect immediately prior to
such record date by a fraction, the numerator of which shall be the Current
Market Price (as determined pursuant to Section 11(d) hereof) per share of
Preferred Stock on such record date, less the fair market value (as determined
in good faith by the Board of Directors, whose determination shall be described
in a statement filed with the Rights Agent) of the portion of the cash, assets
or evidences of indebtedness so to be distributed or of such subscription rights
or warrants applicable to a share of Preferred Stock and the denominator of
which shall be such Current Market Price (as determined pursuant to Section
11(d) hereof) per share of Preferred Stock. Such adjustments shall be made
successively whenever such a record date is fixed, and in the event that such
distribution is not so made, the Purchase Price shall be adjusted to be the
Purchase Price which would have been in effect if such record date had not been
fixed.
(d) (i) For the purpose of any computation hereunder, the Current
Market Price per share of Common Stock on any date shall be deemed to be the
average of the daily Closing Price per share of such Common Stock for the thirty
consecutive Trading Days immediately prior to such date; provided, however, that
in the event that the Current Market Price per share of the Common Stock is
determined during a period following the announcement by the issuer of such
Common Stock of (A) a dividend or distribution on such Common Stock payable in
shares of such Common Stock or securities convertible into shares of such Common
Stock (other than the Rights), (B) any subdivision, combination or
reclassification of such Common Stock or (C) an extraordinary dividend payable
in cash or assets (other than securities described in clause (A)), and the ex-
dividend or ex-distribution date for such dividend or distribution, or the
record date for such subdivision, combination or reclassification shall not have
occurred prior to the commencement of the requisite thirty Trading Day period,
as set forth above, then, and in each such case, the Current Market Price shall
be properly adjusted by the Board of Directors to reflect the current market
price equivalent of the Common Stock. If the Common Stock is not publicly held
or not so listed or traded, Current Market Price per share shall mean the fair
value per share as determined in good faith by the Board of Directors, whose
determination shall be described in a statement filed with the Rights Agent.
(ii) For the purpose of any computation hereunder, the Current Market
Price per share (or one one-hundredth of a share) of Preferred Stock shall be
determined in the same manner as set forth above for the Common Stock in clause
(i) of this Section 11(d) (other than the last sentence thereof). If the
Current Market Price per share (or one one-hundredth of a share) of Preferred
Stock cannot be determined in the manner provided above or if the Preferred
Stock is not publicly held or listed or traded in a manner described in clause
(i) of this Section 11(d), the Current Market Price per share of Preferred Stock
shall be conclusively deemed to be an amount equal to 100 (as such number may be
appropriately adjusted for such events as stock splits, stock dividends and
recapitalizations with respect to the Common Stock occurring after the date of
this Agreement) multiplied by the Current Market Price per share of the Common
Stock. If neither the Common Stock nor the Preferred Stock is publicly held or
so listed or traded, Current Market Price per share of the Preferred Stock shall
mean the fair value per share as determined in good faith by the Board of
Directors, whose determination shall be described in a statement filed with the
Rights Agent. For all purposes of this Agreement, the Current Market Price of
one one-hundredth of a share of Preferred Stock shall be equal to the Current
Market Price of one share of Preferred Stock divided by 100.
(e) Anything herein to the contrary notwithstanding, no adjustment in
the Purchase Price shall be required unless such adjustment would require an
increase or decrease of at least one percent (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 ten-thousandth of a share of Common Stock,
Preferred Stock or other capital stock, as the case may be.
(f) If as a result of an adjustment made pursuant to Section 11(a) or
Section 13(a) hereof, the holder of any Right thereafter exercised shall become
entitled to receive any shares of capital stock other than Preferred Stock,
thereafter the number of such other shares so receivable upon exercise of any
Right, the Purchase Price thereof and the number of Rights shall be subject to
adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the Preferred Stock contained in
Sections 11(a), (b), (c), (e), (g), (h), (i), (j), (k) and (m), and the
provisions of Sections 7, 9, 10, 13 and 14 hereof with respect to the Preferred
Stock shall apply on like terms to any such other shares (except as provided in
Section 14(c) hereof), provided that in no event the amount of the Spread as
determined pursuant to Section 11(a)(iii) be adjusted.
(g) All Rights originally issued by the Company subsequent to any
adjustment made to the Purchase Price hereunder shall evidence the right to
purchase, at the adjusted Purchase Price per one one-hundredth of a share of
Preferred Stock, the number of one one-hundredths of a share of Preferred Stock
purchasable from time to time hereunder upon exercise of the Rights, all subject
to further adjustment as provided herein.
(h) Unless the Company shall have exercised its election as provided
in Section 11(i), upon each adjustment of the Purchase Price as a result of the
calculations made in Sections 11(b) and (c), each Right outstanding immediately
prior to the making of such adjustment shall thereafter evidence the right to
purchase, at the adjusted Purchase Price per one one-hundredth of a share of
Preferred Stock, that number of one one-hundredths of a share of Preferred Stock
(calculated to the nearest one-millionth) obtained by (i) multiplying (A) the
number of one one-hundredths of a share covered by a Right immediately prior to
this 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 lieu of any adjustment in
the number of one one-hundredths of a share of Preferred Stock purchasable upon
the exercise of a Right. Each of the Rights outstanding after the adjustment in
the number of Rights shall be exercisable for the number of one one-hundredths
of a share of Preferred Stock for which a Right was exercisable immediately
prior to such adjustment. Each Right held of record prior to such adjustment of
the number of Rights shall become that number of Rights (calculated to the
nearest ten-thousandth) 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 and shall give simultaneous written notice to the
Rights Agent of its election to adjust the number of Rights, indicating the
record date for the adjustment, and, if known at the time, the amount of the
adjustment to be made. This record date may be the date on which the Purchase
Price is adjusted or any day thereafter, but, if the Rights Certificates have
been issued, shall be at least ten days later than the date of the public
announcement. If Rights 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 Rights
Certificates on such record date Rights Certificates evidencing, subject to
Section 14 hereof, the additional Rights to which such holders shall be entitled
as a result of such adjustment, or, at the option of the Company, shall cause to
be distributed to such holders of record in substitution and replacement for the
Rights Certificates held by such holders prior to the date of adjustment, and
upon surrender thereof, if required by the Company, new Rights Certificates
evidencing all the Rights to which such holders shall be entitled after such
adjustment. Rights Certificates so to be distributed shall be issued, executed
and countersigned in the manner provided for herein (and may bear, at the option
of the Company, the adjusted Purchase Price) and shall be registered in the
names of the holders of record of Rights 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-hundredths of a share of Preferred Stock issuable upon the
exercise of the Rights, the Rights Certificates theretofore and thereafter
issued may continue to express the Purchase Price per one one-hundredth of a
share and the number of one one-hundredths of a share which were expressed in
the initial Rights Certificates issued hereunder.
(k) Notwithstanding anything in this Agreement to the contrary, the
consideration to be paid upon exercise of one Right as a result of any
adjustment hereunder shall not be less than the aggregate par value of the
shares of capital stock issuable upon exercise of such Right. Before taking any
action that would cause such an adjustment, the Company shall take such
corporate action which shall, in the opinion of its counsel, be necessary in
order that the Company may validly and legally issue fully paid and
nonassessable capital stock upon exercise of a Right. If, upon any exercise of
the Rights, a holder is to receive a combination of Common Stock and Common
Stock Equivalents, a portion of the consideration paid upon such exercise, equal
to at least the then par value of a share of Common Stock, shall be allocated as
the payment for each share of Common Stock so received.
(l) In any case in which this Section 11 shall require that an
adjustment in the Purchase Price be made effective as of a record date for a
specified event, the Company may elect to defer until the occurrence of such
event the issuance to the holder of any Right exercised after such record date
the number of one one-hundredths of a share of Preferred Stock and other capital
stock or securities of the Company, if any, issuable upon such exercise over and
above the number of one one-hundredths of a share of Preferred Stock and other
capital stock or securities of the Company, if any, issuable upon such exercise
on the basis of the Purchase Price in effect prior to such adjustment; provided,
however, that the Company shall deliver to such holder a due xxxx or other
appropriate instrument evidencing such holder's right to receive such additional
shares (fractional or otherwise) or securities upon the occurrence of the event
requiring such adjustment.
(m) Anything in this Section 11 to the contrary notwithstanding, the
Company, by resolution of its Board of Directors, shall be entitled to make such
reductions in the Purchase Price, in addition to those adjustments expressly
required by this Section 11, as and to the extent that in its good faith
judgment the Board of Directors shall determine to be advisable in order that
any (i) consolidation or subdivision of the Preferred Stock, (ii) issuance
wholly for cash of any shares of Preferred Stock at less than the Current Market
Price, (iii) issuance wholly for cash of shares of Preferred Stock or securities
which by their terms are convertible into or exchangeable for shares of
Preferred Stock, (iv) stock dividends or (v) issuance of rights, options or
warrants referred to in this Section 11, hereafter made by the Company to
holders of its Preferred Stock shall not be taxable to such stockholders.
(n) The Company covenants and agrees that it shall not, at any time
after the Distribution Date and so long as the Rights have not been redeemed
pursuant to Section 23 hereof or exchanged pursuant to Section 24 hereof, (i)
consolidate with any other Person (other than a Subsidiary of the Company in a
transaction which complies with Section 11(o) hereof), (ii) merge with or into
any other Person (other than a Subsidiary of the Company in a transaction which
complies with Section 11(o) hereof), or (iii) sell or transfer (or permit any
Subsidiary to sell or transfer), in one transaction, or a series of related
transactions, assets or earning power aggregating more than 50% of the assets or
earning power of the Company and its Subsidiaries (taken as a whole) to any
other Person or Persons (other than the Company and/or any of its Subsidiaries
in one or more transactions each of which complies with Section 11(o) hereof),
if (x) at the time of or immediately after such consolidation, merger or sale
there are any certificate of incorporation or bylaw provisions or rights,
warrants or other instruments or securities outstanding or agreements in effect
which would substantially diminish or otherwise eliminate the benefits intended
to be afforded by the Rights, (y) prior to, simultaneously with or immediately
after such consolidation, merger, sale or other transaction, the shareholders of
the Person who constitutes, or would constitute, the "Principal Party" for
purposes of Section 13(a) hereof shall have received a distribution of Rights
previously owned by such Person or any of its Affiliates and Associates or (z)
the form or nature of organization of the Principal Party would preclude or
limit the exercise of Rights or otherwise diminish or substantially eliminate
the benefits intended to be afforded by the Rights.
(o) The Company covenants and agrees that, after the Distribution
Date, it will not, except as permitted by Section 23, Section 24 or Section 27
hereof, take (or permit any Subsidiary to take) any action if at the time such
action is taken it is reasonably foreseeable that such action will diminish
substantially or otherwise eliminate the benefits intended to be afforded by the
Rights.
(p) Anything in this Agreement to the contrary notwithstanding, in
the event that the Company shall at any time after the Rights Dividend
Declaration Date and prior to the Distribution Date (i) declare a dividend on
the outstanding shares of Common Stock payable in shares of Common Stock, (ii)
subdivide the outstanding shares of Common Stock, or (iii) combine the
outstanding shares of Common Stock into a smaller number of shares, the number
of Rights associated with each share of Common Stock then outstanding, or issued
or delivered thereafter but prior to the Distribution Date, shall be
proportionately adjusted so that the number of Rights thereafter associated with
each share of Common Stock following any such event shall equal the result
obtained by multiplying the number of Rights associated with each share of
Common Stock immediately prior to such event by a fraction the numerator of
which shall be the total number of shares of Common Stock outstanding
immediately prior to the occurrence of the event and the denominator of which
shall be the total number of shares of Common Stock outstanding immediately
following the occurrence of such event (the "Adjustment Fraction"). In lieu of
such adjustment in the number of Rights associated with one share of Common
Stock, the Company may elect to adjust the number of one one-hundredths of a
share of Preferred Stock purchasable upon the exercise of one Right and the
Purchase Price. If the Company makes such an election, the number of Rights
associated with one share of Common Stock shall remain unchanged, and the number
of one one-hundredths of a share of Preferred Stock purchasable upon exercise of
one Right and the Purchase Price shall be proportionately adjusted so that (i)
the number of one one-hundredths of a share of Preferred Stock purchasable upon
exercise of a Right following such adjustment shall equal the product of the
number of one one-hundredths of a share of Preferred Stock purchasable upon
exercise of a Right immediately prior to such adjustment multiplied by the
Adjustment Fraction and (ii) the Purchase Price following such adjustment shall
equal the product of the Purchase Price immediately prior to such adjustment
multiplied by the Adjustment Fraction. The adjustments provided for in this
Section 11(p) shall be made successively whenever such a dividend, subdivision
or combination is effected.
SECTION 12. CERTIFICATE OF ADJUSTED PURCHASE PRICE OR NUMBER OF
SHARES.
Whenever an adjustment is made as provided Section 11 and Section 13
hereof, the Company shall (a) promptly prepare a certificate setting forth such
adjustment and a brief statement of the facts accounting for such adjustment,
(b) promptly file with the Rights Agent, and with each transfer agent for the
Preferred Stock and the Common Stock, a copy of such certificate, and (c) mail a
brief summary thereof to each holder of a Rights Certificate (or, if prior to
the Distribution Date, to each holder of a certificate representing shares of
Common Stock) in accordance with Section 26 hereof. Notwithstanding the
foregoing sentence, the failure of the Company to make such certificate or give
such notice shall not affect the validity or force or effect of such adjustment.
The Rights Agent shall be fully protected in relying on any such certificate and
on any adjustment therein contained.
SECTION 13. CONSOLIDATION, MERGER OR SALE OR
TRANSFER OF ASSETS OR EARNING POWER.
(a) In the event that, at any time after any Person becomes an
Acquiring Person, directly or indirectly, (i) the Company shall consolidate
with, or merge with and into, any other Person (other than a Subsidiary of the
Company in a transaction which complies with Section 11(o) hereof), and the
Company shall not be the continuing or surviving corporation of such
consolidation or merger, (ii) any Person (other than a Subsidiary of the Company
in a transaction which complies with Section 11(o) hereof) shall consolidate
with, or merge with or into, the Company, and the Company shall be the
continuing or surviving corporation of such consolidation or merger and, in
connection with such consolidation or merger, all or part of the outstanding
shares of Common Stock shall be 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 shall sell or otherwise transfer (or one or more of its
Subsidiaries shall sell or otherwise transfer), in one transaction or a series
of related transactions, assets or earning power aggregating more than 50% of
the assets or earning power of the Company and its Subsidiaries (taken as a
whole) to any Person or Persons (other than the Company or any Subsidiary of the
Company in one or more transactions each of which complies with Section 11(o)
hereof) (such an event described in (i), (ii) or (iii) above being referred to
herein as "a Section 13 Event"), then, upon the first occurrence of such event
(except as may be contemplated by Section 13(d) hereof), proper provision shall
be made so that: (A) each holder of a Right, except as provided in Section 7(e)
hereof, shall thereafter have the right to receive, upon the exercise thereof in
accordance with the terms of this Agreement, such number of validly authorized
and issued, fully paid, non-assessable and freely tradeable shares of Common
Stock of the Principal Party (as such term is hereinafter defined), not subject
to any liens, encumbrances, rights of call or first refusal or other adverse
claims, as shall be equal to the result obtained by (1) multiplying the then
current Purchase Price by the number of one one-hundredths of a share of
Preferred Stock for which a Right is exercisable immediately prior to the first
occurrence of a Section 13 Event (or, if a Section 11(a)(ii) Event has occurred
prior to the first occurrence of a Section 13 Event, multiplying the number of
such one one-hundredths of a share for which a Right was exercisable immediately
prior to the first occurrence of a Section 11(a)(ii) Event by the Purchase Price
in effect immediately prior to such first occurrence), and dividing that product
by (2) 50% of the Current Market Price (determined pursuant to Section 11(d)(i)
hereof) per share of the Common Stock of such Principal Party on the date of
consummation of such Section 13 Event, provided that the Purchase Price per
share of Common Stock of such Principal Party and the number of shares of Common
Stock of such Principal Party issuable upon exercise of each Right shall be
further adjusted as provided in Section 11(f) of this Agreement to reflect any
events occurring in respect of such Principal Party after the date of such
Section 13 Event; (B) such Principal Party shall thereafter be liable for, and
shall assume, by virtue of such Section 13 Event, all the obligations and duties
of the Company pursuant to this Agreement; (C) the term "Company" shall
thereafter be deemed to refer to such Principal Party, it being specifically
intended that the provisions of Section 11 hereof shall apply only to such
Principal Party following the first occurrence of a Section 13 Event; (D) such
Principal Party shall take such steps (including, but not limited to, the
reservation of a sufficient number of shares of its Common Stock) in connection
with the consummation of any such transaction as may be necessary to assure that
the provisions hereof shall thereafter be applicable, as nearly as reasonably
may be, in relation to its shares of Common Stock thereafter deliverable upon
the exercise of the Rights; and (E) the provisions of Section 11(a)(ii) hereof
shall be of no effect following the first occurrence of any Section 13 Event.
(b) "Principal Party" shall mean
(i) in the case of any transaction described in clause (i) or
(ii) of the first sentence of Section 13(a): (A) the Person that is the issuer
of any securities into which shares of Common Stock of the Company are converted
in such merger or consolidation, or if there is more than one such issuer, the
issuer of the shares of Common Stock which has the greatest aggregate market
value, or (B) if no securities are so issued, (1) the Person that is the other
party to the merger, if such Person survives said merger, or, if there is more
than one such Person, the Person the shares of Common Stock of which has the
greatest aggregate market value or (2) if the Person that is the other party to
the merger does not survive the merger, the Person that does survive the merger
(including the Company if it survives) or (3) the Person resulting from the
consolidation; and
(ii) in the case of any transaction described in clause (iii) of
the first sentence of Section 13(a), the Person that is the party receiving the
greatest portion of the assets or earning power transferred pursuant to such
transaction or transactions or, if each Person that is a party to such
transaction or transactions receives the same portion of the assets or earning
power so transferred or if the Person receiving the greatest portion of the
assets or earning power cannot be determined, whichever of such Persons as is
the issuer of the shares of Common Stock having the greatest aggregate market
value; provided, however, that in any such case, if the Common Stock of such
Person is not at such time and has not been continuously over the preceding
twelve (12) month period registered under Section 12 of the Exchange Act, and
(1) if such Person is a direct or indirect Subsidiary of another Person the
Common Stock of which is and has been so registered, "Principal Party" shall
refer to such other Person; (2) if such Person is a Subsidiary, directly or
indirectly, of more than one Person, the Common Stock of two or more of which
are and have been so registered, "Principal Party" shall refer to whichever of
such Persons is the issuer of the Common Stock having the greatest aggregate
market value; and (3) 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 (1) and (2) above shall
apply to each of the chains of ownership having an interest in such joint
venture as if such party were a "Subsidiary" of both or all of such joint
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 covenants and agrees that it will
cause to be reserved and kept available out of its authorized and unissued
shares of Common Stock or out of its authorized and issued shares held in its
treasury, the number of shares of its Common Stock that will be sufficient to
permit the exercise in full of all outstanding Rights under this Section 13 and
unless prior thereto the Company and such Principal Party shall have executed
and delivered to the Rights Agent a supplemental agreement confirming that the
requirements set forth in paragraphs (a) and (b) of this Section 13 shall be
promptly performed in accordance with their terms and further providing that, as
soon as practicable after executing such agreement pursuant to this Section 13,
the Principal Party will
(i) prepare and file a registration statement under the 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 Act) until the Expiration Date and
similarly comply with applicable state securities laws;
(ii) use its best efforts, if the shares of Common Stock of the
Principal Party shall be listed or admitted to trading on a national
securities exchange or The Nasdaq Stock Market to list or admit to trading
(or continue the listing of) the Rights and the securities purchasable upon
exercise of the Rights on such securities exchange or The Nasdaq Stock
Market and, if the shares of Common Stock of the Principal Party shall not
be so listed or admitted to trading, to cause the Rights and the securities
purchasable upon exercise of the Rights to be eligible for trading in the
over-the-counter market and reported by such other system then in use;
(iii) deliver to holders of the Rights historical financial
statements for the Principal Party and each of its Affiliates which comply
in all respects with the requirements for registration on Form 10 (or any
successor form) under the Exchange Act; and
(iv) obtain waivers of any rights of first refusal or preemptive
rights in respect of the shares of Common Stock of the Principal Party
subject to purchase upon exercise of outstanding Rights.
The provisions of this Section 13 shall similarly apply to successive mergers or
consolidations or sales or other transfers. In the event that a Section 13 Event
shall occur at any time after the occurrence of a Section 11(a)(ii) Event, the
Rights which have not theretofore been exercised shall thereafter become
exercisable in the manner described in Section 13(a).
(d) Notwithstanding anything in this Agreement to the contrary,
Section 13 shall not be applicable to a transaction described in subparagraphs
(i) and (ii) of Section 13(a) if (i) such transaction is consummated with a
Person or Persons who acquired shares of Common Stock pursuant to a Qualifying
Offer (or a wholly owned Subsidiary of any such Person or Persons), (ii) the
price per share of Common Stock offered in such transaction is not less than the
price per share of Common Stock paid to all holders of shares of Common Stock
whose shares were purchased pursuant to such Qualifying Offer and (iii) the form
of consideration being offered to the remaining holders of shares of Common
Stock pursuant to such transaction is the same as the form of consideration paid
pursuant to such Qualifying Offer. Upon consummation of any such transaction
contemplated by this Section 13(d), all Rights hereunder shall expire.
SECTION 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES.
(a) The Company shall not be required to issue fractions of Rights,
except prior to the Distribution Date as provided in Section 11(p) hereof, or to
distribute Rights Certificates or scrip which evidence fractional Rights. In
lieu of such fractional Rights, there shall be paid to the registered holders of
the Rights Certificates with regard to which such fractional Rights would
otherwise be issuable, an amount in cash equal to the same fraction of the
current market value of a whole Right. For purposes of this Section 14(a), the
current market value of a whole Right shall be the Closing Price of the Rights
for the Trading Day immediately prior to the date on which such fractional
Rights would have been otherwise issuable.
(b) The Company shall not be required to issue fractions of shares of
Preferred Stock (other than, except as provided in Section 7(c), fractions which
are integral multiples of one one-hundredth of a share of Preferred Stock) upon
exercise of the Rights or to distribute certificates which evidence fractional
shares of Preferred Stock (other than fractions which are integral multiples of
one one-hundredth of a share of Preferred Stock). Fractions of shares of
Preferred Stock in integral multiples of one one-hundredth of a share of
Preferred Stock 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 shares of
Preferred Stock represented by such depositary receipts. In lieu of fractional
shares of Preferred Stock that are not integral multiples of one one-hundredth
of a share of Preferred Stock, the Company may pay to the registered holders of
Rights Certificates at the time such Rights are exercised as herein provided an
amount in cash equal to the same fraction of the current market value of one
one-hundredth of a share of Preferred Stock. For purposes of this Section
14(b), the current market value of one one-hundredth of a share of Preferred
Stock shall be one one-hundredth of the Closing Price of a share of Preferred
Stock (as determined pursuant to Section 11(d)(ii) hereof) for the Trading Day
immediately prior to the date of such exercise.
(c) Following the occurrence of a Triggering Event, the Company shall
not be required to issue fractions of shares of Common Stock, Common Stock
Equivalents or other securities upon exercise of the Rights or an exchange of
Rights for Common Stock pursuant to Section 24 hereof or to distribute
certificates which evidence fractional shares of Common Stock, Common Stock
Equivalents or other securities. In lieu of fractional shares of Common Stock,
Common Stock Equivalents or other securities, the Company may pay to the
registered holders of Rights Certificates at the time such Rights are exercised
as herein provided an amount in cash equal to the same fraction of the current
market value of one (1) share of Common Stock, Common Stock Equivalents or other
securities. For purposes of this Section 14(c), the current market value shall
be the Closing Price (as determined pursuant to Section 11(d)(i) hereof) for the
Trading Day immediately prior to the date of such exercise or the record date of
exchange, as the case may be.
(d) The holder of a Right by the acceptance of the Rights expressly
waives his right to receive any fractional Rights or any fractional shares upon
exercise or exchange of a Right, except as permitted by this Section 14.
SECTION 15. RIGHTS OF ACTION.
All rights of action in respect of this Agreement, other than rights
of action vested in the rights Agent pursuant to Section 18 hereof, are vested
in the respective registered holders of the Rights Certificates (and, prior to
the Distribution Date, the registered holders of the Common Stock); and any
registered holder of any Rights Certificate (or, prior to the Distribution Date,
of the Common Stock), without the consent of the Rights Agent or of the holder
of any other Rights Certificate (or, prior to the Distribution Date, of the
Common Stock), may, in his own behalf and for his own benefit, enforce, and may
institute and maintain any suit, action or proceeding against the Company to
enforce, or otherwise act in respect of, his right to exercise the Rights
evidenced by such Rights Certificate in the manner provided in such Rights
Certificate and in this Agreement. Without limiting the foregoing or any
remedies available to the holders of Rights, it is specifically acknowledged
that the holders of Rights would not have an adequate remedy at law for any
breach of this Agreement and shall be entitled to specific performance of the
obligations hereunder and injunctive relief against actual or threatened
violations of the obligations hereunder of any Person subject to this Agreement.
After a Triggering Event, holders of Rights shall be entitled to recover the
reasonable costs and expenses, including attorneys' fees, incurred by them in
any action to enforce the provisions of this Agreement.
SECTION 16. AGREEMENT OF RIGHTS HOLDERS.
Every holder of a Right by accepting the same consents and agrees with
the Company and the Rights Agent and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be transferable
only in connection with the transfer of Common Stock;
(b) after the Distribution Date, the Rights Certificates are
transferable only on the registry books of the Rights Agent if surrendered at
the principal office or offices of the Rights Agent designated for such
purposes, duly endorsed or accompanied by a proper instrument of transfer and
with the appropriate forms and certificates fully executed;
(c) subject to Section 6(a) and Section 7(f) hereof, the Company and
the Rights Agent may deem and treat the person in whose name a Rights
Certificate (or, prior to the Distribution Date, the associated Common Stock
certificate) is registered as the absolute owner thereof and of the Rights
evidenced thereby (notwithstanding any notations of ownership or writing on the
Rights Certificates or the associated Common Stock certificate made by anyone
other than the Company or the Rights Agent) for all purposes whatsoever, and
neither the Company nor the Rights Agent, subject to the penultimate sentence of
Section 7(e) hereof, shall be required to be affected by any notice to the
contrary; and
(d) notwithstanding anything in this Agreement to the contrary,
neither the Company nor the Rights Agent shall have any liability to any holder
of a Right or other Person as a result of its inability to perform any of its
obligations under this Agreement by reason of any preliminary or permanent
injunction or other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative agency or
commission, or any statute, rule, regulation or executive order promulgated or
enacted by any governmental authority, prohibiting or otherwise restraining
performance of such obligation; provided, however, the Company must use all
reasonable efforts to have any such order, decree or ruling lifted or otherwise
overturned as soon as possible.
SECTION 17. RIGHTS CERTIFICATE HOLDER NOT DEEMED A
STOCKHOLDER.
No holder, as such, of any Rights Certificate shall be entitled to
vote, receive dividends or be deemed for any purpose the holder of the number of
one one-hundredths of a share of Preferred Stock or any other securities of the
Company which may at any time be issuable upon the exercise of the Rights
represented thereby, nor shall anything contained herein or in any Rights
Certificate be construed to confer upon the holder of any Rights Certificate, as
such, any of the rights of a 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 Section 25 hereof), or to receive dividends or subscription rights,
or otherwise, until the Right or Rights evidenced by such Rights Certificate
shall have been exercised in accordance with the provisions hereof.
SECTION 18. CONCERNING THE RIGHTS AGENT.
(a) The Company agrees to pay to the Rights Agent such compensation
as shall be agreed to in writing between the Company and the Rights Agent for
all services rendered by it hereunder and, from time to time, on demand of the
Rights Agent, its reasonable costs, charges, advances, expenses and counsel fees
and disbursements and other disbursements incurred in the administration and
execution of this Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Rights Agent for, and to
hold it harmless against, any loss, liability, or expense, incurred without
negligence, bad faith or willful misconduct on the part of the Rights Agent, for
anything done or omitted by the Rights Agent in connection with the acceptance
and administration of this Agreement, including the costs and expenses of
defending against any claim of liability in the premises (including reasonable
counsel fees and expenses).
(b) The Rights Agent shall be protected and shall incur no liability
for or in respect of any action taken, suffered or omitted by it in connection
with its administration of this Agreement in reliance upon any Rights
Certificate or certificate for Common Stock or for other securities of the
Company, instrument of assignment or transfer, power of attorney, endorsement,
affidavit, letter, notice, direction, consent, certificate, statement, or other
paper or document reasonably believed by it to be genuine and to be signed,
executed and, where necessary, verified or acknowledged, by the proper Person or
Persons.
SECTION 19. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF RIGHTS
AGENT.
(a) Any corporation into which the Rights Agent or any successor
Rights Agent may be merged or with which it may be consolidated, or any
corporation resulting from any merger or consolidation to which the Rights Agent
or any successor Rights Agent shall be a party, or any corporation succeeding to
the corporate trust or stock transfer business of the Rights Agent or any
successor Rights Agent (including, without limitation, through a purchase of all
or substantially all of the assets relating to such business), shall be the
successor to the Rights Agent under this Agreement without the execution or
filing of any paper or any further act on the part of any of the parties hereto;
provided, however, that such corporation would be eligible for appointment as a
successor Rights Agent under the provisions of Section 21 hereof. In case at
the time such successor Rights Agent shall succeed to the agency created by this
Agreement, any of the Rights Certificates shall have been countersigned but not
delivered, any such successor Rights Agent may adopt the countersignature of a
predecessor Rights Agent and deliver such Rights Certificates so countersigned;
and in case at that time any of the Rights Certificates shall not have been
countersigned, any successor Rights Agent may countersign such Rights
Certificates either in the name of the predecessor or in the name of the
successor Rights Agent; and in all such cases such Rights Certificates shall
have the full force provided in the Rights Certificates and in this Agreement.
(b) In case at any time the name of the Rights Agent shall be changed
and at such time any of the Rights Certificates shall have been countersigned
but not delivered, the Rights Agent may adopt the countersignature under its
prior name and deliver Rights Certificates so countersigned; and in case at that
time any of the Rights Certificates shall not have been countersigned, the
Rights Agent may countersign such Rights Certificates either in its prior name
or in its changed name; and in all such cases such Rights Certificates shall
have the full force provided in the Rights Certificates and in this Agreement.
SECTION 20. DUTIES OF RIGHTS AGENT.
The Rights Agent undertakes the duties and obligations imposed by this
Agreement upon the following terms and conditions, by all of which the Company
and the holders of Rights Certificates, by their acceptance thereof, shall be
bound:
(a) The Rights Agent may consult with legal counsel (who may be legal
counsel for the Company), and the opinion of such counsel shall be full and
complete authorization and protection to the Rights Agent as to any action taken
or omitted by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this Agreement
the Rights Agent shall deem it necessary or desirable that any fact or matter
(including, without limitation, the identity of any Acquiring Person and the
determination of "Current Market Price") be proved or established by the Company
prior to taking or omitting any action hereunder, such fact or matter (unless
other evidence in respect thereof be herein specifically prescribed) may be
deemed to be conclusively proved and established by a certificate signed by the
Chairman of the Board, any Vice Chairman, the President, any Vice President, the
Treasurer, any Assistant Treasurer, the Secretary or any Assistant 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 omitted in good
faith by it under the provisions of this Agreement in reliance upon such
certificate.
(c) The Rights Agent shall be liable hereunder only for its own
negligence, bad faith or willful misconduct.
(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, the Summary of
Rights or in the Rights Certificates or be required to verify the same (except
as to its countersignature on such Rights Certificates), but all such statements
and recitals are and shall be deemed to have been made by the Company only.
(e) The Rights Agent shall not be under any responsibility in respect
of the validity of this Agreement or the execution and delivery hereof (except
the due execution hereof by the Rights Agent) or in respect of the validity or
execution of any Rights Certificate (except its countersignature thereof); nor
shall it be responsible for any breach by the Company of any covenant or
condition contained in this Agreement or in any Rights Certificate; nor shall it
be responsible for any adjustment required under the provisions of Section 11 or
Section 13 hereof or responsible for the manner, method or amount of any such
adjustment or the ascertaining of the existence of facts that would require any
such adjustment (except with respect to the exercise of Rights evidenced by
Rights Certificates after actual notice of any such adjustment); nor shall it by
any act hereunder be deemed to make any representation or warranty as to the
authorization or reservation of any shares of Common Stock or Preferred Stock to
be issued pursuant to this Agreement or any Rights Certificate or as to whether
any shares of Common Stock or Preferred Stock will, when so issued, be validly
authorized and issued, fully paid and nonassessable. The Rights Agent shall not
be accountable for the use by the Company of any Rights Certificate
countersigned and delivered to the Company in accordance with this Agreement or
any certificate for Common Stock or Preferred Stock delivered to the Company in
accordance with this Agreement.
(f) The Company agrees that it will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered all such
further and other acts, instruments and assurances as may reasonably be required
by the Rights Agent for the carrying out or performing by the Rights Agent of
the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from the
Chairman of the Board, any Vice Chairman, the President, any Vice President, the
Secretary, any Assistant Secretary, the Treasurer or any Assistant 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
omitted to be taken by it in good faith in accordance with instructions of any
such officer. The Rights Agent shall incur no liability for any delay that may
result from its request for advice or instructions as specified above.
(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 become pecuniarily interested in any transaction in
which the Company may be interested, or contract with or lend money to the
Company or otherwise act as fully and freely as though it were not Rights Agent
under this Agreement. Nothing herein shall preclude the Rights Agent from
acting in any other capacity for the Company or for any other 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, however, reasonable care was exercised in the
selection and continued employment thereof.
(j) No provision of this Agreement shall require the Rights
Agent to expend or risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder or in the exercise of its
rights if there shall be reasonable grounds for believing that repayment of such
funds or adequate indemnification against such risk or liability is not
reasonably assured to it.
(k) If, with respect to any Rights Certificate surrendered to
the Rights Agent for exercise or transfer, the certificate attached to the form
of assignment or form of election to purchase, as the case may be, has either
not been completed or indicates an affirmative response to clause 1 and/or 2
thereof, the Rights Agent shall not take any further action with respect to such
requested exercise or transfer without first consulting with the Company.
(l) The Rights Agent shall have no responsibility to the
Company, any holders of Rights or any holders of Common Stock for interest or
earnings on any monies held by the Rights Agent pursuant to this Agreement.
(m) The Rights Agent shall not be required to take notice or be
deemed to have notice of any event or condition hereunder, including, but not
limited to, a Distribution Date, a Redemption Date, any adjustment of the
Purchase Price or the Common Stock, the existence of an Acquiring Person or a
Beneficial Owner or any other event or condition that may require action by the
Rights Agent, unless the Rights Agent shall be specifically notified of such
event or condition by the Company, and all notices or other instruments required
by this Agreement to be delivered to the Rights Agent must, in order to be
effective, be given to the Rights Agent in accordance with Section 26 hereof,
and in the absence of such notice, the Rights Agent may conclusively assume no
such event or condition exists.
SECTION 21. CHANGE OF RIGHTS AGENT.
The Rights Agent or any successor Rights Agent may resign and be
discharged from its duties under this Agreement upon thirty days' notice in
writing mailed to the Company and to each transfer agent of the Common Stock and
Preferred Stock, by registered or certified mail, and to the holders of the
Rights Certificates in accordance with Section 26 hereof, or, if prior to the
Distribution Date, to the holders of Rights through any filing made by the
Company pursuant to the Exchange Act. The Company may remove the Rights Agent
or any successor Rights Agent (with or without cause) upon thirty days' notice
in writing mailed to the Rights Agent or successor Rights Agent, as the case may
be, and shall provide notice thereof to each transfer agent of the Common Stock
and Preferred Stock, by registered or certified mail, and to the holders of the
Rights Certificates in accordance with Section 26 hereof, or, if prior to the
Distribution Date, to the holders of Rights through any filing made by the
Company pursuant to the Exchange Act. If the Rights Agent shall resign or be
removed or shall otherwise become incapable of acting, the Company shall appoint
a successor to the Rights Agent. If the Company shall fail to make such
appointment within a period of thirty days after giving notice of such removal
or after it has been notified in writing of such resignation or incapacity by
the resigning or incapacitated Rights Agent or by the holder of a Rights
Certificate (who shall, with such notice, submit his Rights Certificate for
inspection by the Company), then any registered holder of any Rights Certificate
or the resigning or removed Rights Agent may apply to any court of competent
jurisdiction for the appointment of a new Rights Agent. Any successor Rights
Agent, whether appointed by the Company or by such a court, shall be (i) a
corporation organized and doing business under the laws of the United States or
any state of the United States, in good standing, having a principal office in
the State of Kansas, the State of Missouri or the State of New York, which is
authorized under the laws of such state(s) to exercise corporate trust or stock
transfer powers and is subject to supervision or examination by federal or state
authority and which has at the time of its appointment as Rights Agent a
combined capital and surplus of at least $100,000,000 or (ii) a subsidiary of a
corporation described in clause (i) 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; and the predecessor Rights Agent shall deliver and transfer
to the successor Rights Agent any property at the time held by it hereunder, and
execute and deliver any further assurance, conveyance, act or deed necessary for
the purpose. Not later than the effective date of any such appointment, the
Company shall file notice thereof in writing with the predecessor Rights Agent
and each transfer agent of the Common Stock and the Preferred Stock, and mail a
notice thereof in writing to the registered holders of the Rights Certificates
in accordance with Section 26 hereof, or, if prior to the Distribution Date,
give notice to the holders of Rights through any filing made by the Company
pursuant to the Exchange Act. 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 RIGHTS CERTIFICATES.
Notwithstanding any of the provisions of this Agreement or of the
Rights to the contrary, the Company may, at its option, issue new Rights
Certificates evidencing Rights in such form as may be approved by its Board of
Directors to reflect any adjustment or change in the Purchase Price and the
number or kind or class of shares or other securities or property purchasable
under the Rights Certificates made in accordance with the provisions of this
Agreement. In addition, in connection with the issuance or sale of shares of
Common Stock following the Distribution Date and prior to the redemption or
expiration of the Rights, the Company shall, with respect to shares of Common
Stock so issued or sold pursuant to the exercise of stock options or under any
employee plan or arrangement, granted or awarded as of the Distribution Date, or
upon the exercise, conversion or exchange of securities issued by the Company on
or prior to the Distribution Date; provided, however, that (i) no such Rights
Certificate shall be issued if, and to the extent that, the Company shall be
advised by counsel that such issuance would create a significant risk of
material adverse tax consequences to the Company or the Person to whom such
Rights Certificate would be issued, and (ii) no such Rights Certificate shall be
issued if, and to the extent that, appropriate adjustment shall otherwise have
been made in lieu of the issuance thereof.
SECTION 23. REDEMPTION AND TERMINATION.
(a) The Board of Directors may, at its option, at any time prior to
such time as any Person becomes an Acquiring Person, cause the Company to redeem
all but not less than all the then outstanding Rights at a redemption price of
$.01 per Right, as such amount may be appropriately adjusted to reflect any
stock split, stock dividend or similar transaction occurring after the date
hereof (such redemption price being hereinafter referred to as the "Redemption
Price"), provided that the Board of Directors may cause the Company to redeem
less than all of the then outstanding Rights prior to such time as any Person
becomes an Acquiring Person in connection with the payment of cash in lieu of
issuing fractional shares in connection with a recapitalization, combination or
reverse stock split of the Common Stock of the Company. The Company may, at its
option, pay the Redemption Price in cash, shares of Common Stock (based on the
Current Market Price of the Common Stock at the time of redemption) or any other
form of consideration deemed appropriate by the Board of Directors. The
redemption of the Rights may be made effective at such time, on such basis and
with such conditions as the Board of Directors in its sole discretion may
establish.
(b) Immediately upon the action of the Board of Directors ordering
the redemption of all of the Rights pursuant to Section 23(a) (or at such later
time or upon such conditions as the Board of Directors may establish for the
effectiveness of such redemption), and without any further action and without
any notice, the right to exercise the Rights will terminate and the only right
thereafter of the holders of Rights shall be to receive the Redemption Price for
each Right so held. The Company shall promptly make a public announcement of
any such redemption; provided, however, that the failure to make, or any defect
in, such public announcement shall not affect the validity of such redemption.
Promptly after the action of the Board of Directors ordering the redemption of
the Rights becoming effective, the Company shall mail a notice of such
redemption to the Rights Agent and the holders of the then outstanding Rights in
accordance with Section 26 hereof (provided that the failure to give, or any
defect in, such notice shall not affect the validity of such redemption). Any
notice which is mailed in the manner provided in Section 26 hereof shall be
deemed given, whether or not the holder receives the notice. Each such notice
of redemption will state the method by which the payment of the Redemption Price
will be made.
SECTION 24. EXCHANGE.
(a) The Board of Directors may, at its option, at any time after any
Person becomes an Acquiring Person, exchange all or part of the then outstanding
and exercisable Rights (which shall not include Rights that have become void
pursuant to the provisions of Section 7(e) hereof) for shares of Common Stock at
an exchange ratio of one share of Common Stock per Right, appropriately adjusted
to reflect any stock split, stock dividend or similar transaction occurring
after the date hereof (such exchange ratio being hereinafter referred to as the
"Exchange Ratio"). Notwithstanding the foregoing, the Board of Directors shall
not be empowered to effect such exchange at any time after any Person (other
than an Exempt Person), together with all Affiliates and Associates of such
Person, becomes the Beneficial Owner of 50% of more of the shares of Common
Stock then outstanding.
(b) Immediately upon the action of the Board of Directors ordering
the exchange of any Rights pursuant to Section 24(a) and without any further
action and without any notice, the right to exercise such Rights shall terminate
and the only right thereafter of a holder of such Rights shall be to receive
that number of shares of Common Stock equal to the number of such Rights held by
such holder multiplied by the Exchange Ratio. The Company shall promptly make a
public announcement of any such exchange; provided, however, that the failure to
make, or any defect in, such public announcement shall not affect the validity
of such exchange. Promptly after the action of the Board of Directors ordering
the exchange of the Rights becoming effective, the Company shall mail a notice
of such exchange to the Rights Agent and all of the holders of the then
outstanding Rights in accordance with Section 26 hereof (provided that the
failure to give, or any defect in, such notice shall not affect the validity of
such exchange). Any notice which is mailed in the manner provided in Section 26
hereof shall be deemed given, whether or not the holder receives the notice.
Each such notice of exchange will state the method by which the exchange of the
shares of Common Stock 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 the event that there shall not be authorized and unissued
shares of Common Stock and/or authorized and issued shares of Common Stock held
in its treasury sufficient to permit any exchange of Rights as contemplated in
accordance with this Section 24, the Company shall take all such action as may
be necessary to authorize additional shares of Common Stock for issuance upon
exchange of the Rights. In the event the Company shall, after good faith
effort, be unable to take all such action as may be necessary to authorize such
additional shares of Common Stock, the Company shall substitute, for each share
of Common Stock that would otherwise be issuable upon exchange of a Right, a
number of shares of Preferred Stock or fraction thereof (subject to Section
14(b) hereof) such that the value per share of Preferred Stock as determined by
the Board of Directors multiplied by such number or fraction is equal to the
Current Market Price per share of Common Stock as of the date of issuance of
such shares of Preferred Stock or fraction thereof.
SECTION 25. NOTICE OF CERTAIN EVENTS.
(a) In case the Company shall propose, at any time after the
Distribution Date, (i) to pay any dividend payable in stock of any class to the
holders of Preferred Stock or to make any other distribution to the holders of
Preferred Stock (other than a regular quarterly cash dividend out of earnings or
retained earnings of the Company), or (ii) to offer to the holders of Preferred
Stock options, rights or warrants to subscribe for or to purchase any additional
shares of Preferred Stock or shares of stock of any class or any other
securities, rights or options, or (iii) to effect any reclassification of its
Preferred Stock (other than a reclassification involving only the subdivision of
outstanding shares of Preferred Stock), or (iv) to effect any consolidation or
merger into or with any other Person (other than a Subsidiary of the Company in
a transaction which complies with Section 11(o) hereof), 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 transaction or a series of related transactions,
of more than 50% of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to any other Person or Persons (other than the
Company and/or any of its Subsidiaries in one or more transactions each of which
complies with Section 11(o) hereof), or (v) to effect the liquidation,
dissolution or winding up of the Company, then, in each such case, the Company
shall give to each holder of a Rights Certificate, to the extent feasible and in
accordance with Section 26 hereof, a notice of such proposed action, which shall
specify the record date for the purposes of such stock dividend, 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 shares of Preferred
Stock, if any such date is to be fixed, and such notice shall be so given in the
case of any action covered by clause (i) or (ii) above at least twenty days
prior to the record date for determining holders of the shares of Preferred
Stock for purposes of such action, and in the case of any such other action, at
least twenty days prior to the date of the taking of such proposed action or the
date of participation therein by the holders of the shares of Preferred Stock,
whichever shall be the earlier. The failure to give notice as required under
this subparagraph (a) or any defect therein shall not affect the legality or
validity of the action taken by the Company or the vote upon any such action.
(b) In case a Section 11(a)(ii) Event shall occur, then, in any such
case, (i) the Company shall as soon as practicable thereafter give to each
holder of a Rights Certificate, to the extent feasible and in accordance with
Section 26 hereof, a notice of the occurrence of such event, which shall specify
the event and the consequences of the event to holders of Rights under Section
11(a)(ii) hereof, and (ii) all references in the preceding paragraph to
Preferred Stock shall be deemed thereafter to refer to Common Stock and/or, if
appropriate, other securities.
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 Rights Certificate to or on the Company
shall be sufficiently given or made if sent by first-class mail, postage
prepaid, addressed (until another address is filed in writing with the Rights
Agent) as follows:
TransFinancial Holdings, Inc.
0000 Xxxxxx Xxxx, Xxxxx 000
Xxxxxx, Xxxxxx 00000
Attention: President
with a copy to:
Xxxx X. Xxxxxxxxx, Esq.
Xxxxxxxx & Xxxxxx L.L.P.
0000 Xxxxx Xxxxxx
Xxxxxx Xxxx, XX 00000
Subject to the provisions of Section 21, any notice or demand
authorized by this Agreement to be given or made by the Company or by the holder
of any Rights Certificate to or on the Rights Agent shall be sufficiently given
or made if sent by first-class mail, postage prepaid, addressed (until another
address is filed in writing with the Company) as follows:
UMB Bank, N.A., as Rights Agent
X.X. Xxx 000000
Xxxxxx Xxxx, Xxxxxxxx 00000-0000
Attention: Corporate Trust Department
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Rights Certificate (or, if
prior to the Distribution Date, to the holder of certificates representing
shares of Common Stock) 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 Rights Agent (or, if prior to the
Distribution Date, on the registry books of the Transfer Agent for the Common
Stock 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 the Rights 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
changes which the Company may deem necessary or desirable, any such supplement
or amendment to be evidenced by a writing signed by the Company and the Rights
Agent; provided, however, that from and after the time any Person becomes an
Acquiring Person, neither the Redemption Price nor the Final Expiration Date
shall be changed, nor shall this Agreement otherwise be amended or supplemented
in any manner which would change the terms of the Rights so as to affect them
adversely and/or adversely affect the interests of the holders of the Rights.
Upon the delivery of a certificate from an appropriate officer of the Company
which states that the proposed supplement or amendment is in compliance with the
terms of this Section 27, the Rights Agent shall execute such supplement or
amendment; provided, however, that the Rights Agent may, but shall not be
obligated to, enter into any such supplement or amendment which adversely
affects the Rights Agent's own rights, duties or immunities under this
Agreement.
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. DETERMINATIONS AND ACTIONS BY THE BOARD OF DIRECTORS,
ETC.
The Board of Directors, except as otherwise specifically provided for
herein, shall have the exclusive power and authority to administer this
Agreement and to exercise all rights and powers specifically granted to the
Board of Directors or to the Company, or as may be necessary or advisable in the
administration of this Agreement, including, without limitation the right and
power to (i) interpret the provisions of this Agreement, and (ii) make all
determinations deemed necessary or advisable for the administration of this
Agreement (including a determination to redeem or not redeem the Rights or to
amend the Agreement). All such actions, calculations, interpretations and
determinations (including, for purposes of clause (y) below, all omissions with
respect to the foregoing) which are done or made by the Board of Directors in
good faith, (x) shall be final, conclusive and binding on the Company, the
Rights Agent, the holders of the Rights Certificates (and, prior to the
Distribution Date, registered holders of the Common Stock) and all other
parties, and (y) shall not subject the Board of Directors or any member of the
Board of Directors to any liability to the holders of the Rights.
SECTION 30. 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
Rights Certificates (and, prior to the Distribution Date, registered holders of
the Common Stock) any legal or equitable right, remedy or claim under this
Agreement; but this Agreement shall be for the sole and exclusive benefit of the
Company, the Rights Agent and the registered holders of the Rights Certificates
(and, prior to the Distribution Date, registered holders of the Common Stock).
SECTION 31. 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. Without limiting the foregoing,
if any provision requiring that a determination be made by less than the entire
Board of Directors (or at a time or with the concurrence of a group of directors
consisting of less than the entire Board of Directors) is held by a court of
competent jurisdiction or other authority to be invalid, void or unenforceable,
such determination shall then be made by the Board of Directors in accordance
with applicable law and the Company's Certificate of Incorporation and Bylaws.
SECTION 32. GOVERNING LAW.
This Agreement, each Right and each Rights Certificate issued
hereunder shall be deemed to be a contract made under the laws of the State of
Delaware and for all purposes shall be governed by and construed in accordance
with the laws of such State applicable to contracts made and to be performed
entirely within such State.
SECTION 33. 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 34. 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.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
TRANSFINANCIAL HOLDINGS, INC.
Attest:
By: /s/ Xxxxxxx X. X'Xxxx
By:/s/ Xxxx X. Xxxxx Name: Xxxxxxx X. X'Xxxx
Name: Xxxx X. Xxxxx Title: President
Title: Corporate Secretary
UMB BANK, N.A.
Attest:
By: /s/ Xxxxx X. Xxxxxxxx
Name: Xxxxx X. Xxxxxxxx
By: /s/ Xxxxxxxx Xxxxx Title: SVP
Name: Xxxxxxxx Xxxxx
Title: AVP
EXHIBIT A
TRANSFINANCIAL HOLDINGS, INC.
FORM OF CERTIFICATE OF DESIGNATIONS OF
SERIES A PREFERRED STOCK
Pursuant to Section 151 of the General
Corporation Law of the State of Delaware
We, Xxxxxxx X. X'Xxxx, President, and Xxxx X. Xxxxx, Corporate Secretary,
of TransFinancial Holdings, Inc. (the "Corporation"), a corporation organized
and existing under the General Corporation Law of the State of Delaware, in
accordance with the provisions thereof, DO HEREBY CERTIFY:
That pursuant to authority expressly vested in the Board of Directors of
the Corporation by the provisions of the Restated Certificate of Incorporation
of the Corporation, the Board of Directors on July 14, 1998 adopted the
following resolutions creating a series of One Hundred Thousand (100,000) shares
of Preferred Stock, $.01 par value per share, of the Corporation ("Preferred
Stock") designated as Series A Preferred Stock:
RESOLVED, that pursuant to the authority vested in the Board of
Directors of this Corporation by the provisions of Restated Certificate of
Incorporation of the Corporation, there is hereby created a series of
Preferred Stock designated as Series A Preferred Stock, consisting of One
Hundred Thousand Shares (100,000) shares of the authorized but unissued
shares of preferred stock, $.01 par value per share, of the Corporation;
and
FURTHER RESOLVED, that the Series A Preferred Stock shall have the
powers, designations, preferences and relative, participating, optional or
other rights and the qualifications, limitations or restrictions set forth
in Appendix I attached hereto.
IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designations to be signed by its President and attested by its Secretary on this
15th day of July, 1998.
TRANSFINANCIAL HOLDINGS, INC.
By:
Xxxxxxx X. X'Xxxx
President
ATTEST:
Xxxx X. Xxxxx
Corporate Secretary
APPENDIX I
RELATIVE RIGHTS AND PREFERENCES OF
SERIES A PREFERRED STOCK
1. Designation. One Hundred Thousand (100,000) authorized and unissued
shares of preferred stock, $.01 par value per share, of the Corporation are
hereby designated as "Series A Preferred Stock" ("Series A").
2. Dividends.
(a) Each holder of a share of Series A shall be entitled to receive,
when, as and if declared by the Board of Directors out of funds legally
available for that purpose, subject to adjustment as hereinafter set forth, 100
times the aggregate per share amount of all cash dividends, and 100 times the
aggregate per share amount (payable in kind) of all non-cash dividends or other
distributions (except any Excluded Dividend), declared (but not withdrawn) on
the Common Stock, $.01 par value per share, of the Corporation (the "Common
Stock"), at any time after July , 1998 (the "Rights Dividend Declaration
Date"). As used herein, an "Excluded Dividend" shall mean a dividend payable in
shares of Common Stock or a subdivision of the outstanding shares of Common
Stock (by reclassification or otherwise).
(b) Except with respect to an Excluded Dividend, the Corporation
shall declare a dividend or distribution on the Series A as provided in
paragraph (a) above concurrently with or immediately after it declares a
dividend or distribution on the Common Stock, and such dividend or distribution
shall be payable concurrently with the dividend or distribution on the Common
Stock. Except with respect to an Excluded Dividend, the Corporation shall not
pay a dividend or make a distribution to holders of Common Stock unless the
Corporation concurrently pays a dividend or makes a distribution to holders of
the Series A in accordance with paragraph (a) above.
(c) In the event the Corporation shall at any time after the Rights
Dividend Declaration Date (i) declare any dividend on Common Stock payable in
shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine the outstanding Common Stock into a smaller number of shares, then in
each such case the amount to which holders of shares of Series A were entitled
immediately prior to such event under paragraph (a) above shall be adjusted by
multiplying such amount by a fraction, the numerator of which is the number of
shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
3. Voting Rights. In addition to any other voting rights required by law,
the holders of shares of Series A shall have the following voting rights:
(a) The holders of shares of Series A shall be entitled to 100 votes
for each share of Series A held on all matters submitted to a vote of the
stockholders of the Corporation. In the event the Corporation shall at any time
after the Rights Dividend Declaration Date (i) declare any dividend on Common
Stock payable in shares of Common Stock, (ii) subdivide the outstanding Common
Stock, or (iii) combine the outstanding Common Stock into a smaller number of
shares, then in each such case the number of votes per share to which holders of
shares of the Series A 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 shares of Common Stock outstanding immediately after such event and
the denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(b) Except as otherwise provided herein or required by law, the
holders of shares of Series A and the holders of shares of Common Stock shall
vote together as one class on all matters submitted to a vote of stockholders of
the Corporation.
(c) Except as otherwise provided herein or required by law, the
holders of shares of Series A shall have no special voting rights and their
consent shall not be required (except to the extent they are entitled to vote
with holders of shares of Common Stock as set forth herein or as otherwise
required by law) for the taking of any corporate action.
4. Reacquired Shares. Any shares of Series A purchased or otherwise
acquired by the Corporation in any manner whatsoever shall be retired and
canceled promptly after the acquisition thereof. All such shares shall upon
their cancellation become authorized but unissued shares of Preferred Stock, and
may be reissued as part of a new series of Preferred Stock to be created by
resolution or resolutions of the Board of Directors, subject to the conditions
and restrictions on issuance set forth herein, in the Restated Certificate of
Incorporation, in any other Certificate of Designations establishing a series of
Preferred Stock or any similar stock or as otherwise required by law.
5. Liquidation, Dissolution or Winding Up.
(a) In the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, the holders of the shares of the
Series A shall be entitled to receive the greater of (i) $100.00 per share
($1.00 per one one-hundredth of a share), or (ii) an amount per share, subject
to adjustment as hereinafter set forth, equal to 100 times the aggregate amount
to be distributed per share to holders of Common Stock. No distribution upon
liquidation, dissolution or winding up shall be made to holders of shares of
Common Stock or holders of any other shares of stock ranking junior to the
Series A with respect to the distribution of assets upon liquidation,
dissolution or winding up until all holders of shares of Series A shall have
received the amounts to which such holders are entitled under this Section.
(b) In the event the Corporation shall at any time after the Rights
Dividend Declaration Date (i) declare any dividend on Common Stock payable in
shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine the outstanding Common Stock into a smaller number of shares, then in
each such case the amount to which holders of shares of Series A were entitled
immediately prior to such event pursuant to clause (ii) of paragraph (a) above
shall be adjusted by multiplying such amount by a fraction, the numerator of
which is the number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
6. Consolidation, Merger, etc.
(a) In the event the Corporation shall enter into any consolidation,
merger, combination or other transaction in which the shares of Common Stock are
exchanged for or changed into other stock or securities, cash and/or any other
property, then in any such event shares of Series A 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 100 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 share of Common Stock is changed or
exchanged.
(b) In the event the Corporation shall at any time after the Rights
Dividend Declaration Date (i) declare any dividend on Common Stock payable in
shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine the outstanding Common Stock into a smaller number of shares, then in
each such case the amount set forth in paragraph (a) above with respect to the
exchange or change of shares of the Series A shall be adjusted by multiplying
such amount by a fraction, the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were outstanding immediately
prior to such event.
7. Ranking. Nothing herein shall preclude the Board of Directors of the
Corporation from creating any series of Preferred Stock or any similar stock
ranking on a parity with or prior to Series A shares as to the payment of
dividends or the distribution of assets upon liquidation, dissolution or winding
up.
8. Redemption. Shares of Series A shall not be redeemable at the option
of the Corporation or any holder thereof. Notwithstanding the foregoing
sentence of this Section, the Corporation may acquire shares of Series A in any
other manner permitted by law and the Restated Certificate of Incorporation and
By-laws of the Corporation.
9. Conversion. Shares of Series A are not convertible into shares of any
other class or series of stock of the Corporation.
10. Amendment. The Restated Certificate of Incorporation of the
Corporation, including without limitation the provisions hereof, shall not
hereafter be amended, either directly or indirectly, or through merger,
consolidation or share exchange with another corporation or entity, in any
manner which would alter or change the powers, preferences or special rights of
the Series A so as to affect the holders thereof adversely, without the
affirmative vote of the holders of a majority of the shares of Series A, voting
separately as a class.
11. Fractional Shares. The Series A may be issued in fractions of a share
which shall entitle the holder, in proportion to such holder's fractional
shares, to exercise voting rights, receive dividends, participate in
distributions and to have the benefit of all other rights of holders of shares
of the Series A.
EXHIBIT B
FORM OF RIGHTS CERTIFICATE
Certificate No. R- Rights
NOT EXERCISABLE AFTER JULY 14, 2008, OR EARLIER IF REDEEMED OR EXCHANGED BY THE
COMPANY. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT
$.01 PER RIGHT ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. THE RIGHTS ARE
SUBJECT TO EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER
CERTAIN CIRCUMSTANCES, RIGHTS WHICH ARE OR WERE BENEFICIALLY OWNED BY A PERSON
WHO BECOMES AN ACQUIRING PERSON OR BY AN AFFILIATE OR ASSOCIATE OF SUCH PERSON
(AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) MAY BECOME, OR MAY HAVE
ALREADY BECOME, NULL AND VOID. [THE RIGHTS REPRESENTED BY THIS RIGHTS
CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON WHO WAS OR SUBSEQUENTLY
BECAME AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE OF AN ACQUIRING PERSON
(AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT). ACCORDINGLY, THIS RIGHTS
CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY BECOME, OR MAY ALREADY HAVE
BECOME, NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF SUCH
AGREEMENT.]*
RIGHTS CERTIFICATE
TRANSFINANCIAL HOLDINGS, 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 July 14, 1998, as it may from time to time be supplemented
or amended (the "Rights Agreement"), between TransFinancial Holdings, Inc., a
Delaware corporation (the "Company"), and UMB Bank, N.A., a national banking
association, as agent (the "Rights Agent"), to purchase from the Company at any
time prior to 5:00 P.M. (New York City time) on July 14, 2008 (the "Final
Expiration Date") at the principal office or offices of the Rights Agent
designated for such purpose, or its successors as Rights Agent, one one-
hundredth of a fully paid, non-assessable share of Series A Preferred Stock,
$.01 par value per share (the "Preferred Stock"), of the Company, at a purchase
price of $50 per one one-hundredth of a share of
* The portion of the legend in brackets shall be inserted only
if applicable and shall replace the preceding sentence.
Preferred Stock (the "Purchase Price"), upon presentation and surrender of this
Rights Certificate with the Form of Election to Purchase and related Certificate
duly executed.
The Purchase Price shall be paid, at the election of the holder, in cash or
by certified check, cashier's check or money order payable to the order of the
Company. The number of Rights evidenced by this Rights Certificate (and the
number of one one-hundredths of a share which may be purchased upon exercise
thereof) set forth above, and the Purchase Price per share set forth above, are
the number and Purchase Price as of July 14, 1998, based on the Preferred Stock
as constituted on such date. The Company reserves the right to require prior to
the occurrence of a Triggering Event that a number of Rights be exercised so
that only whole shares of Preferred Stock will be issued.
From and after the occurrence of a Section 11(a)(ii) Event (as such term is
defined in the Rights Agreement), if the Rights evidenced by this Rights
Certificate are beneficially owned by (i) an Acquiring Person or an Affiliate or
Associate of an Acquiring Person (as such terms are defined in the Rights
Agreement), (ii) a transferee of an Acquiring Person or of any such Associate or
Affiliate, or (iii) under certain circumstances specified in the Rights
Agreement, a transferee of a person who, concurrently with or 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 the Section 11(a)(ii) Event.
As provided in the Rights Agreement, the Purchase Price and the number and
kind of shares of Preferred Stock or other securities which may be purchased
upon the exercise of the Rights evidenced by this Rights Certificate are subject
to modification and adjustment upon the happening of certain events, including
Triggering Events (as such term is defined in the Rights Agreement).
This Rights Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Rights Certificates, which
limitations of rights include the temporary suspension of the exercisability of
such Rights under the specific circumstances set forth in the Rights Agreement.
Copies of the Rights Agreement are on file at the above-mentioned office of the
Rights Agent and are also available upon written request to the Company.
This Rights Certificate, with or without other Rights Certificates, upon
surrender at the principal office or offices of the Rights Agent designated for
such purpose, may be exchanged for another Rights Certificate or Rights
Certificates of like tenor and date evidencing Rights entitling the holder to
purchase a like aggregate number of one one-hundredths of a share of Preferred
Stock as the Rights evidenced by the Rights Certificate or Rights Certificates
surrendered shall have entitled such holder to purchase. If this Rights
Certificate shall be exercised in part, the holder shall be entitled to receive
upon surrender hereof another Rights Certificate or Rights Certificates for the
number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced by
this Certificate may be redeemed by the Company at its option at a redemption
price of $.01 per Right, at any time prior to the time any Person becomes an
Acquiring Person. The redemption price shall be payable, at the election of the
Company, in cash, shares of Common Stock or such other consideration as the
Board of Directors may deem appropriate. In addition, subject to the provisions
of the Rights Agreement, each Right evidenced by this Certificate may be
exchanged by the Company at its option for one share of Common Stock (subject to
adjustment for any stock split, stock dividend or similar transaction), at any
time after any Person becomes an Acquiring Person.
The Company is not required to issue fractional shares of Preferred Stock
upon the exercise of any Right or Rights evidenced hereby (other than fractions
which are integral multiples of one one-hundredth of a share of Preferred Stock,
which may, at the election of the Company, be evidenced by depositary receipts).
In lieu thereof, a cash payment may be made, as provided in the Rights
Agreement.
No holder of this Rights Certificate, as such, shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of shares of Preferred
Stock or of any other securities of the Company which may at any time be
issuable 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 Rights
Certificate shall have been exercised as provided in the Rights Agreement.
This Rights Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the Company and
its corporate seal.
Dated as of
ATTEST: TRANSFINANCIAL HOLDINGS, INC.
By:
Secretary Name:
Title:
Countersigned:
UMB BANK, N.A., as Rights Agent
By:
Authorized Signature
[Form of Reverse Side of Rights Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Rights Certificate.)
FOR VALUE RECEIVED hereby sells,
assigns and transfers unto
(Please print name and address of transferee)
this Rights Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint
Attorney, to transfer the within Rights Certificate on the books of the within-
named Company, with full power of substitution.
Dated:
Signature
Signature Guaranteed:
Signatures must be guaranteed by an eligible guarantor institution (banks,
stockbrokers, savings and loan associations and credit unions with membership in
an approved signature guarantee medallion program), pursuant to SEC Rule 17Ad-
15.
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.
Dated:
Signature
Signature Guaranteed:
Signatures must be guaranteed by an eligible guarantor institution (banks,
stockbrokers, savings and loan associations and credit unions with membership in
an approved signature guarantee medallion program), pursuant to SEC Rule 17Ad-
15.
NOTICE
The signature to the foregoing Assignment and Certificate must correspond
to the name as written upon the face of this Rights Certificate in every
particular, without alteration or enlargement or any change whatsoever.
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to
exercise Rights represented by the Rights Certificate.)
To: TRANSFINANCIAL HOLDINGS, INC.:
The undersigned hereby irrevocably elects to exercise Rights
represented by this Rights Certificate to purchase the shares of Preferred Stock
issuable upon the exercise of the Rights (or such other securities of the
Company or of any other person which may be issuable upon the exercise of the
Rights) and requests that certificates for such shares be issued in the name of
and delivered to:
(Please print name and address)
Please provide Social security
or taxpayer identification number
If such number of Rights shall not be all the Rights evidenced by this
Rights Certificate, a new Rights Certificate for the balance of such Rights
shall be registered in the name of and delivered to:
(Please print name and address)
Please provide Social security
or taxpayer identification number
Dated:
Signature
Signature Guaranteed:
Signatures must be guaranteed by an eligible guarantor institution (banks,
stockbrokers, savings and loan associations and credit unions with membership in
an approved signature guarantee medallion program), pursuant to SEC Rule 17Ad-
15.
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 was or subsequently became an Acquiring Person or an
Affiliate or Associate of an Acquiring Person.
Dated:
Signature
Signature Guaranteed:
Signatures must be guaranteed by an eligible guarantor institution (banks,
stockbrokers, savings and loan associations and credit unions with membership in
an approved signature guarantee medallion program), pursuant to SEC Rule 17Ad-
15.
NOTICE
The signature to the foregoing Election to Purchase and Certificate must
correspond to the name as written upon the face of this Rights Certificate in
every particular, without alteration or enlargement or any change whatsoever.
EXHIBIT C
SUMMARY OF RIGHTS TO PURCHASE
PREFERRED STOCK
March 4, 1999
Declaration of Rights Dividend
On July 14, 1998, the Board of Directors of TransFinancial Holdings, Inc. (the
"Company") declared a dividend distribution of one Right for each outstanding
share of Common Stock, $.01 par value per share, of the Company ("Common
Stock"). The dividend was payable on July 27, 1998 to stockholders of record at
the close of business on that date. Each Right entitles the registered holder
to purchase from the Company at any time following the Distribution Date (as
defined below) a unit consisting of one one-hundredth of a share (a "Unit") of
Series A Preferred Stock, $.01 par value per share (the "Preferred Stock"), at a
purchase price of $50 per Unit (the "Purchase Price"), subject to adjustment as
described below. The description and terms of the Rights were amended by and
are set forth in a First Amended and Restated Rights Agreement dated March 4,
1999 (the "Rights Agreement") between the Company and UMB Bank, N.A., as Rights
Agent.
Rights will also be issued with respect to shares of Common Stock issued or
transferred by the Company after July 27, 1998 and prior to the Distribution
Date, and, under certain circumstances, Rights will be issued with respect to
shares of Common Stock issued or transferred by the Company after the
Distribution Date.
Rights Initially Attached to and Trade with Common Stock
Until the earlier of the Distribution Date or the date the Rights are
redeemed or expire, (a) the Rights will be evidenced by Common Stock
certificates and no separate Rights Certificates will be distributed, (b) the
Rights will be transferable only in connection with the transfer of the
underlying shares of Common Stock, (c) the surrender for transfer of any Common
Stock certificate (with or without a copy of this Summary of Rights attached
thereto) will also constitute the transfer of the Rights associated with the
shares of Common Stock represented by such certificate and (d) new Common Stock
certificates issued after July 27, 1998 will contain a notation incorporating
the Rights Agreement by reference. Stockholders will not be required to take
any action in connection with the initial distribution of Rights on July 27,
1998.
When Rights Separate from Common Stock and Become Exercisable
The Rights will separate from the Common Stock and become exercisable on
the Distribution Date, which will occur upon the earlier of (i) the date of a
public announcement or a public disclosure of facts by the Company or any Person
(as defined in the Rights Agreement) that such Person has become an "Acquiring
Person" (as defined below) and (ii) 10 business days (or such later date as the
Board shall determine prior to such time as there is an Acquiring Person)
following the commencement of, or announcement of an intention to make, a tender
or exchange offer, the consummation of which would result in a Person becoming
an Acquiring Person, with certain exceptions specified in the Rights Agreement.
As soon as practicable after the Distribution Date, Rights Certificates will be
mailed to holders of record of the Common Stock as of the close of business on
the Distribution Date, and thereafter the separate Rights Certificates alone
will represent the Rights. The Rights are not exercisable until the Distribution
Date.
Under the Rights Agreement, an Acquiring Person is a Person who, together
with all affiliates and associates of such Person, and without the prior written
approval of the Company, is the Beneficial Owner (as defined in the Rights
Agreement) of 15% or more of the outstanding shares of Common Stock of the
Company, subject to a number of exceptions set forth in the Rights Agreement.
The Rights Agreement exempts certain persons from the definition of "Acquiring
Person," including the Company, any subsidiary of the Company, any employee
benefit plan of the Company or any subsidiary, and certain persons or entities
organized, appointed or established pursuant to the terms of any such plan.
Under the Rights Agreement, a Person shall not be an Acquiring Person if such
Person acquires beneficial ownership of 15% or more of the outstanding shares of
Common Stock pursuant to Qualifying Offer, which is a cash tender offer for all
of the outstanding shares of Common Stock which meets certain conditions
specified in the Rights Agreement. The Rights Agreement contains exceptions for
Persons who inadvertently become Acquiring Persons or who become Beneficial
Owners of 15% or more of the outstanding Common Stock as a result of repurchases
of stock by the Company, if certain conditions are satisfied.
Adjustment of Rights upon Occurrence of a Triggering Event
In the event that a Person becomes an Acquiring Person, each holder of a
Right (except the Acquiring Person and certain other persons as described below)
will no longer have the right to purchase Units of Preferred Stock, but instead
will thereafter have the right to receive, upon exercise of the Right, shares of
Common Stock (or, in certain circumstances, cash, property or other securities
of the Company) having a Current Market Value (as defined in the Rights
Agreement) equal to two times the then current exercise price of the Right. For
example, at a Purchase Price of $50 per Right, each Right not owned by an
Acquiring Person (except as provided below) would entitle its holder to purchase
$100 worth of Common Stock (or other consideration, as noted above) for $50.
Assuming that the Common Stock has a per share value of $10 at such time, the
holder of each valid Right would be entitled to purchase ten shares of Common
Stock for $50. Once a Person becomes an Acquiring Person, all Rights that are,
or under certain circumstances were, beneficially owned by such Acquiring Person
(or certain related parties) will be null and void.
In the event that, at any time after a Person becomes an Acquiring Person,
(i) the Company is acquired in a merger or other business combination
transaction in which the Company is not the surviving corporation (other than a
merger which follows a Qualifying Offer and satisfies certain other
requirements), or (ii) 50% or more of the Company's assets or earning power is
sold or transferred, each holder of a Right (except Rights which previously have
been voided as set forth above) shall thereafter have the right to receive, upon
exercise, common stock of the acquiring company having a value equal to two
times the then current Purchase Price of the Right.
The events set forth in this paragraph and in the preceding paragraph which
allow Rights to be exercised are referred to as "Triggering Events."
Exchange of Rights
At any time after any Person becomes an Acquiring Person, the Board of
Directors of the Company may, at its option, exchange the Rights (except Rights
which previously have been voided as set forth above), in whole or in part, at
an exchange ratio of one share of Common Stock for each Right, subject to
adjustment for any stock split, stock dividend or similar transaction occurring
after July 14, 1998. The Board of Directors may not cause the exchange after
any person (except an exempt person) and that person's affiliates and associates
acquires at least 50% of the then-outstanding shares of Common Stock.
Redemption of Rights
At any time prior to any Person becoming an Acquiring Person, the Company
may order that all Rights be redeemed at a price of $.01 per Right (payable in
cash, Common Stock or other consideration deemed appropriate by the Board of
Directors), subject to adjustment for any stock split, stock dividend or similar
transaction occurring after July 14, 1998 (the "Redemption Price"). Immediately
upon the effectiveness of the action of the Board of Directors ordering
redemption of the Rights, the right to exercise the Rights will terminate and
the holders of the Rights will only be entitled to receive the Redemption Price
for each Right so held.
Amendment of Rights
For so long as the Rights are redeemable, the Company may amend the Rights
in any manner. After the Rights are no longer redeemable, neither the
Redemption Price nor the Final Expiration Date may be changed, and the Agreement
may not otherwise be amended or supplemented in any manner which would change
the terms of the Rights so as to affect them adversely and/or adversely affect
the interests of the holders of the Rights.
Terms of Preferred Stock
Each Unit of Preferred Stock (consisting of one one-hundredth of a share of
Preferred Stock) that is issuable upon exercise of the Rights after the
Distribution Date and prior to the occurrence of a Triggering Event is intended
to have approximately the same economic rights and voting power as a share of
Common Stock, and the value of a Unit of Preferred Stock should approximate the
value of one share of Common Stock. Each share of Preferred Stock will be
entitled to dividend payments equal to 100 times the aggregate per share amount
of all dividends (other than a dividend payable in Common Stock) declared per
share of Common Stock. In the event of liquidation, the holders of shares of
Preferred Stock will be entitled to the greater of (a) a minimum preferential
liquidation payment of $100 per share, plus accrued dividends, or (b) 100 times
the aggregate amount to be distributed per share of Common Stock. Each share of
Preferred Stock will have 100 votes, voting together with, and on the same
matters as, the Common Stock. In the event of any merger, consolidation or
other transaction in which shares of Common Stock are exchanged for or changed
into other stock, securities, cash and/or other property, each share of
Preferred Stock will be entitled to receive 100 times the amount received per
share of Common Stock. These rights are protected by customary anti-dilution
provisions. Shares of Preferred Stock are not redeemable. Pursuant to the
Rights Agreement, the Company reserves the right to require, prior to the
occurrence of a Triggering Event, that upon any exercise of Rights a number of
Rights be exercised so that only whole shares of Preferred Stock will be issued.
Adjustment of Rights and Securities Upon Certain Events
The Purchase Price payable, and the number of Units of Preferred Stock or
other securities or property issuable, upon exercise of the Rights are subject
to adjustment from time to time to prevent dilution (i) in the event of a stock
dividend on, or a subdivision, combination or reclassification of, the Preferred
Stock, or (ii) upon the distribution to holders of the Preferred Stock of
certain rights, options, warrants, evidences of indebtedness or assets
(excluding regular quarterly cash dividends). No adjustment in the Purchase
Price will be required until cumulative adjustments amount to at least 1% of the
Purchase Price. The Company is not required to issue fractional Units; in lieu
thereof, the Company may pay cash for such fractional Units based on the market
price of the Preferred Stock on the last trading date prior to the date of
exercise.
The number of outstanding Rights attached to each share of Common Stock and
the number of Units of Preferred Stock purchasable upon exercise of a Right are
also subject to adjustment in the event of a stock split of the Common Stock or
a stock dividend on the Common Stock payable in shares of Common Stock or a
subdivision or combination of the shares of Common Stock, occurring prior to the
Distribution Date.
Rights Holder Not a Stockholder
Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Company, including, without limitation, the right
to vote or to receive dividends. The holders of Rights will be able to vote and
receive dividends on the Common Stock that they hold.
Tax Consequences
While the distribution of the Rights will not be taxable to stockholders or
to the Company, stockholders might, depending upon the circumstances, realize
taxable income in the event that the Rights become severable from the Common
Stock and will likely realize taxable income in the event such Rights become
exercisable for common stock of the acquiring company as set forth above or are
exchanged as provided above.
Expiration of Rights
The Rights will expire at the close of business on July 14, 2008, unless
the Company redeems or exchanges the Rights prior to such date, in each case as
described above.
Rights Agreement
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to Amendment No. 1 to the Registration
Statement on Form 8-A dated March 5, 1999. A copy of the Rights Agreement is
available free of charge from the Rights Agent. This summary description of the
Rights does not purport to be complete and is qualified in its entirety by
reference to the Rights Agreement, which is incorporated herein by reference.
