EXHIBIT 4.1
R&B FALCON CORPORATION
and
AMERICAN STOCK TRANSFER AND TRUST COMPANY
Rights Agent
__________________
Rights Agreement
Dated as of __________, 1997
Table of Contents
Section Page
1. Certain Definitions . . . . . . . . . . . . . . . . . 2
2. Appointment of Rights Agent . . . . . . . . . . . . . 5
3. Issue of Rights Certificates . . . . . . . . . . . . 6
4. Form of Rights Certificates . . . . . . . . . . . . . 7
5. Countersignature and Registration . . . . . . . . . . 8
6. Transfer, Split Up, Combination and Exchange of
Rights Certificates; Mutilated, Destroyed, Lost
or Stolen Rights Certificates . . . . . . . . . . . 9
7. Exercise of Rights; Purchase Price; Expiration
Date of Rights . . . . . . . . . . . . . . . . . . 10
8. Cancellation and Destruction of Rights
Certificates . . . . . . . . . . . . . . . . . . . 13
9. Reservation and Availability of Capital Stock . . . . 13
10. Preferred Stock Record Date . . . . . . . . . . . . 15
11. Adjustment of Purchase Price, Number and Kind of
Shares or Number of Rights . . . . . . . . . . . . 15
12. Certificate of Adjusted Purchase Price or Number
of Shares . . . . . . . . . . . . . . . . . . . . 25
13. Consolidation, Merger or Sale or Transfer of
Assets or Earning Power . . . . . . . . . . . . . 26
14. Fractional Rights and Fractional Shares . . . . . . 29
15. Rights of Action . . . . . . . . . . . . . . . . . . 30
16. Agreement of Rights Holders . . . . . . . . . . . . 31
17. Rights Certificate Holder Not Deemed a
Stockholder . . . . . . . . . . . . . . . . . . . 31
18. Concerning the Rights Agent . . . . . . . . . . . . 32
19. Merger or Consolidation or Change of Name of
Rights Agent . . . . . . . . . . . . . . . . . . . 32
20. Duties of Rights Agent . . . . . . . . . . . . . . . 33
21. Change of Rights Agent . . . . . . . . . . . . . . . 35
22. Issuance of New Rights Certificates . . . . . . . . 36
23. Redemption and Termination. . . . . . . . . . . . . 37
24. Notice of Certain Events . . . . . . . . . . . . . . 38
25. Notices . . . . . . . . . . . . . . . . . . . . . . 39
26. Supplements and Amendments . . . . . . . . . . . . . 39
27. Successors . . . . . . . . . . . . . . . . . . . . . 40
28. Determinations and Actions by the Board of
Directors, etc. . . . . . . . . . . . . . . . . . 41
29. Benefits of this Agreement . . . . . . . . . . . . . 41
30. Severability . . . . . . . . . . . . . . . . . . . . 41
31. Governing Law . . . . . . . . . . . . . . . . . . . 42
32. Counterparts . . . . . . . . . . . . . . . . . . . . 42
33. Descriptive Headings . . . . . . . . . . . . . . . . 42
Exhibit A -- Amended and Restated Certificate of
Incorporation . . . . . . . . . . . . . . . A-1
Exhibit B -- Form of Rights Certificate . . . . . . . . . B-1
RIGHTS AGREEMENT
RIGHTS AGREEMENT, dated as of __________, 1997
(the "Agreement"), between R&B Falcon Corporation, a
Delaware corporation (the "Company"), and American Stock
Transfer & Trust Company, a trust company organized under
the laws of the State of New York (the "Rights Agent").
W I T N E S S E T H
WHEREAS, on July 10, 1997, the Company, FDC
Acquisition Corp., a Delaware corporation, Reading &
Xxxxx Acquisition Corp., a Delaware corporation, Falcon
Drilling Company, a Delaware company ("Falcon"), and
Reading & Xxxxx Corporation ("R&B"), entered into the
Agreement and Plan of Reorganization (the "Merger
Agreement"), pursuant to which, among other things,
Falcon and R&B will become wholly owned subsidiaries of
the Company and the former stockholders of Falcon and R&B
will become stockholders of the Company (the
"Transaction");
WHEREAS, as a part of the Transaction, Falcon
and R&B determined that it would be desirable to
distribute Rights (as hereinafter defined) associated
with the shares of Common Stock (as hereinafter defined)
of the Company to be issued in the Transaction to the
former stockholders of Falcon and R&B and that
certificates representing such Common Stock would also
evidence such Rights and that the registered holders of
Common Stock would also be the registered holders of the
associated Rights;
WHEREAS, Section 6.16(b) of the Merger
Agreement provides that Falcon and R&B will take all
actions necessary to cause the Company to adopt a Rights
Plan providing for the distribution of Rights prior to
the consummation of the Transaction;
WHEREAS, in order to effectuate the foregoing,
Falcon and R&B, as the sole stockholders of Parent, are
authorizing and directing the Company to create a
stockholder rights plan, to issue Rights to the former
stockholders of Falcon and R&B in connection with the
Transaction, which Rights will be attached to the shares
of Common Stock and evidenced by certificates
representing Common Stock and to enter into a rights
agreement substantially in the form of this Agreement;
WHEREAS, the Board of Directors of the Company
has authorized the distribution as of the Effective Time
(as defined in the Merger Agreement) of the Mergers (as
defined in the Merger Agreement) of one Right for each
share of Common Stock of the Company issued in connection
with the Mergers, and authorized the issuance of one
Right (as such number may hereafter be adjusted pursuant
to the provisions of Section 11(p) hereof) for each share
of Common Stock of the Company issued between the
Effective Time (whether originally issued or delivered
from the Company's treasury) and the Distribution Date
(as hereinafter defined), each Right initially
representing the right to purchase one one-hundredth of a
share of Series A Junior Participating Preferred Stock of
the Company having the rights, powers and preferences set
forth in the Amended and Restated Certificate of
Incorporation of the Company attached hereto as Exhibit
A, upon the terms and subject to the conditions
hereinafter set forth (the "Rights");
NOW, THEREFORE, in consideration of the
premises and the mutual agreements herein set forth, the
parties hereby agree as follows:
Section 1. Certain Definitions. For purposes
of this Agreement, the following terms have the meanings
indicated:
(a) "Acquiring Person" shall mean any
Person who or which, together with all Affiliates and
Associates of such Person, shall after the Effective Time
be the Beneficial Owner of 15% or more of the shares of
Common Stock then outstanding, but shall not include (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 or entity
organized, appointed or established by the Company for or
pursuant to the terms of any such plan, or any Person who
becomes 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 shall
purchase or otherwise become the Beneficial Owner of
additional shares of Common Stock constituting 1% or more
of the then outstanding shares of Common Stock.
Notwithstanding the foregoing, if the Board of Directors
of the Company determines in good faith that a Person who
would otherwise be an Acquiring Person has become such
inadvertently, and such Person divests as promptly as
practicable a sufficient number of shares of Common Stock
so that such Person would no longer be an Acquiring
Person, then such Person shall not be deemed to be an
Acquiring Person for any purposes of this Agreement.
(b) "Affiliate" and "Associate" shall
have the respective meanings ascribed to such terms in
Rule 12b-2 of the General Rules and Regulations under the
Securities Exchange Act of 1934, as amended and in effect
on the date of this Agreement (the "Exchange Act").
(c) A Person shall be deemed the
"Beneficial Owner" of, and shall be deemed to
"beneficially own," any securities:
(i) which such Person or any of
such Person's Affiliates or Associates,
directly or indirectly, has the right to
acquire (whether such right is exercisable
immediately or only after the passage of time)
pursuant to any agreement, arrangement or
understanding (whether or not in writing) or
upon the exercise of conversion rights,
exchange rights, rights, warrants or options,
or otherwise; provided, however, that a Person
shall not be deemed the "Beneficial Owner" of,
or to "beneficially own," (A) securities
tendered pursuant to a tender or exchange offer
made 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 upon
exercise of Rights at any time prior to the
occurrence of a Triggering Event, or (C)
securities issuable upon exercise of Rights
from and after the occurrence of a Triggering
Event 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(a) 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;
(ii) which such Person or any
of such Person's Affiliates or Associates,
directly or indirectly, has the right to vote
or dispose of or has "beneficial ownership" of
(as determined pursuant to Rule 13d-3 of the
General Rules and Regulations under the
Exchange Act), including pursuant to any
agreement, arrangement or understanding,
whether or not in writing; provided, however,
that a Person shall not be deemed the
"Beneficial Owner" of, or to "beneficially
own," any security under this subparagraph (ii)
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); or
(iii) which are beneficially
owned, directly or indirectly, by any other
Person (or any Affiliate or Associate thereof)
with which such Person (or any of such Person's
Affiliates or Associates) has any agreement,
arrangement or understanding (whether or not in
writing), for the purpose of acquiring,
holding, voting (except pursuant to a revocable
proxy as described in the proviso to
subparagraph (ii) of this paragraph (c)) or
disposing of any voting securities of the
Company; provided, however, that nothing in
this paragraph (c) shall cause a Person engaged
in the business as an underwriter of securities
to be deemed the "Beneficial Owner" of, or to
"beneficially own," any securities acquired
through such Person's participation in good
faith in a firm commitment underwriting until
the expiration of forty (40) days after the
date of such acquisition.
(d) "Business Day" shall mean any day
other than a Saturday, Sunday or a day on which banking
institutions in the State of New York are authorized or
obligated by law or executive order to close.
(e) "Close of business" on any given date
shall mean 5:00 P.M., New York City time, on such date;
provided, however, that if such date is not a Business
Day it shall mean 5:00 P.M., New York City time, on the
next succeeding Business Day.
(f) "Common Stock" shall mean the common
stock, par value $.01 per share, of the Company, except
that "Common Stock" when used with reference to any
Person other than the Company shall mean the capital
stock of such Person with the greatest voting power, or
the equity securities or other equity interest having
power to control or direct the management, of such
Person.
(g) "Continuing Director" shall mean (i)
any member of the Board of Directors of the Company,
while such Person is a member of the Board, who is not an
Acquiring Person, or an Affiliate or Associate of an
Acquiring Person, or a representative of an Acquiring
Person or of any such Affiliate or Associate, and was a
member of the Board at the Effective Time, or (ii) any
Person who subsequently becomes a member of the Board,
while such Person is a member of the Board, who is not an
Acquiring Person, or an Affiliate or Associate of an
Acquiring Person, or a representative of an Acquiring
Person or of any such Affiliate or Associate, if such
Person's nomination for election or election to the Board
is recommended or approved by a majority of the
Continuing Directors.
(h) "Person" shall mean any individual,
firm, corporation, partnership or other entity.
(i) "Preferred Stock" shall mean shares
of Series A Junior Participating Preferred Stock, par
value $.01 per share, of the Company and, to the extent
that there are not a sufficient number of shares of
Series A Junior Participating Preferred Stock authorized
to permit the full exercise of the Rights, any other
series of preferred stock, par value $.01 per share, of
the Company designated for such purpose containing terms
substantially similar to the terms of the Series A Junior
Participating Preferred Stock.
(j) "Section 11(a)(ii) Event" shall mean
the event described in Section 11(a)(ii) hereof.
(k) "Section 13 Event" shall mean any
event described in clauses (x), (y) or (z) of Section
13(a) hereof.
(l) "Stock Acquisition Date" shall mean
the first date of public announcement (which, for
purposes of this definition, shall include, without
limitation, a report filed pursuant to Section 13(d)
under the Exchange Act) by the Company or an Acquiring
Person that an Acquiring Person has become such.
(m) "Subsidiary" shall mean, with
reference to any Person, any corporation of which an
amount of voting securities sufficient to elect at least
a majority of the directors of such corporation is
beneficially owned, directly or indirectly, by such
Person, or otherwise controlled by such Person.
(n) "Triggering Event" shall mean the
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 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 (i) the close of
business on the tenth Business Day after the Stock
Acquisition Date or (ii) the close of business on the
tenth Business Day (or such later date as the Board of
Directors shall determine) after the date that a tender
or exchange offer by any Person (other than the Company,
any Subsidiary of the Company, any employee benefit plan
of the Company or of any Subsidiary of the Company, or
any Person or entity organized, appointed or established
by the Company for or pursuant to the terms of any such
plan) is first published or sent or given within the
meaning of Rule 14d-2(a) of the General Rules and
Regulations under the Exchange Act, if upon consummation
thereof, such Person would be the Beneficial Owner of 15%
or more of the shares of Common Stock then outstanding
(the earlier of (i) and (ii) being herein referred to as
the "Distribution Date"), (x) the Rights will be
evidenced (subject to the provisions of paragraph (b) of
this Section 3) by the certificates for the Common 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, and (y) the Rights will be
transferable only in connection with the transfer of the
underlying shares of Common Stock (including a transfer
to the Company). As soon as practicable after the
Distribution Date, the Rights Agent will 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 right
certificates, in substantially the form of Exhibit B
hereto (the "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 shall make the necessary and 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.
(b) Rights shall be issued in respect of
all shares of Common Stock which are issued after the
Effective Time but prior to the earlier of the
Distribution Date or the Expiration Date. Certificates
representing such shares of Common Stock shall also be
deemed to be certificates for Rights, and shall bear the
following legend:
This certificate also evidences and
entitles the holder hereof to certain Rights as
set forth in the Rights Agreement between R&B
Falcon Corporation and American Stock Transfer
& Trust Company, dated as of __________, 1997
(the "Rights Agreement"), the terms of which
are hereby incorporated herein by reference and
a copy of which is on file at the principal
offices of R&B Falcon Corporation. 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. R&B Falcon
Corporation 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.
With respect to such certificates containing the
foregoing legend, until the earlier of (i) the
Distribution Date or (ii) the Expiration Date, the Rights
associated with the Common Stock represented by such
certificates shall be evidenced by such certificates
alone and registered holders of Common Stock shall also
be the registered holders of the associated Rights, and
the transfer of any of such certificates shall also
constitute the transfer of the Rights associated with the
Common Stock represented by such 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
or with any rule or regulation made pursuant thereto or
with any rule or regulation of any stock exchange on
which the Rights may from time to time be listed, or to
conform to usage. Subject to the provisions of Section
11 and Section 22 hereof, the Rights Certificates,
whenever distributed, shall be dated as of the Effective
Time and on their face 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(a) 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 of
the Company 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 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 null and void in the circumstances
specified in Section 7(e) of such Agreement.
Section 5. Countersignature and Registration.
(a) The Rights Certificates shall be
executed on behalf of the Company by its Chairman of the
Board, 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 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 who shall have signed any of the Rights
Certificates shall cease to be such officer of the
Company before countersignature by the Rights Agent and
issuance and delivery by the Company, such Rights
Certificates, nevertheless, may be countersigned by the
Rights Agent and issued and delivered by the Company with
the same force and effect as though the person who signed
such Rights Certificates had not ceased to be such
officer of the Company; and any Rights Certificates 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 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,
following a Triggering Event, 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) 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 23(a) hereof) in
whole or in part at any time after the Distribution Date
upon surrender of the Rights Certificate, with the form
of election to purchase and the certificate on the
reverse side thereof duly executed, to the Rights Agent
at the principal office or offices of the Rights Agent
designated for such purpose, together with 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, at or prior to the earlier of (i) the close
of business on November 1, 2007 (the "Final Expiration
Date"), or (ii) the time at which the Rights are redeemed
as provided in Section 23 hereof (the earlier of (i) and
(ii) being herein referred to as the "Expiration Date").
(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 $150, and shall be
subject to adjustment from time to time as provided in
Sections 11 and 13(a) hereof and shall be payable 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 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, 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) 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, 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) may be made (x) in cash or by
certified bank check or bank draft payable to the order
of the Company, or (y) by delivery of a certificate or
certificates (with appropriate stock powers executed in
blank attached thereto) evidencing a number of shares of
Common Stock equal to the then Purchase Price divided by
the closing price (as determined pursuant to Section
11(d) hereof) per share of Common Stock on the Trading
Day immediately preceding the date of such exercise. 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 occurrence
of the 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 of the Company 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 insure that the
provisions of this Section 7(e) and Section 4(b) hereof
are complied with, but shall have no liability to any
holder of Rights Certificates or other Person as a result
of its failure to make any determinations with respect to
an Acquiring Person or its Affiliates, Associates or
transferees hereunder.
(f) Notwithstanding anything in this
Agreement to the contrary, neither the Rights Agent nor
the Company shall be obligated to undertake any action
with respect to a registered holder upon the occurrence
of any purported exercise as set forth in this Section 7
unless 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 cancelled form, or, if
surrendered to the Rights Agent, shall be cancelled 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 cancelled Rights Certificates to
the Company, or shall, at the written request of the
Company, destroy such cancelled 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, the Company shall
use its best efforts to cause, from and after such time
as the Rights become exercisable, all shares reserved for
such issuance to be listed on such exchange upon official
notice of issuance upon such exercise.
(c) The Company shall use its best
efforts (i) to file, as soon as practicable following the
earliest date after the occurrence of the 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, or as soon as is required by law following the
Distribution Date, as the case may be, a registration
statement under the Securities Act of 1933 (the "Act"),
with respect to the securities purchasable upon exercise
of the Rights on an appropriate form, (ii) to cause such
registration statement to become effective as soon as
practicable after such filing, and (iii) to cause such
registration statement to remain effective (with a
prospectus at all times meeting the requirements of the
Act) until the earlier of (A) the date as of which the
Rights are no longer exercisable for such securities, and
(B) the date of the expiration of the Rights. The
Company will also take such action as may be appropriate
under, or to ensure compliance with, the securities or
"blue sky" laws of the various states in connection with
the exercisability of the Rights. The Company may
temporarily suspend, 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
issue a public announcement stating that the
exercisability of the Rights has been temporarily
suspended, as well as a public announcement at such time
as the suspension is no longer in effect.
Notwithstanding any provision of this Agreement to the
contrary, the Rights shall not be exercisable in any
jurisdiction if the requisite qualification in such
jurisdiction shall not have been obtained, the exercise
thereof shall not be permitted under applicable law or a
registration statement shall not have been declared
effective.
(d) The Company covenants and agrees that
it will take all such action as may be necessary to
ensure that all one one-hundredths of a share of
Preferred Stock (and, following the occurrence of a
Triggering Event, Common Stock and/or other securities)
delivered upon exercise of Rights shall, at the time of
delivery of the certificates for such shares (subject to
payment of the Purchase Price), be duly and validly
authorized and issued and fully paid and nonassessable.
(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 a number
of one one-hundredths of a share of 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 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 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 a number of one
one-hundredths of a share of Preferred Stock (or Common
Stock and/or other securities, as the case may be) is
issued upon the exercise of Rights shall for all purposes
be deemed to have become the holder of record of such
fractional shares of Preferred Stock (or Common Stock
and/or other securities, as the case may be) represented
thereby on, and such certificate shall be dated, the date
upon which the Rights Certificate evidencing such Rights
was duly surrendered and payment of the Purchase Price
(and 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 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 Purchase Price then in effect,
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, he would have owned upon
such exercise and been entitled to receive by
virtue of such dividend, subdivision,
combination or reclassification. If an event
occurs which would require an adjustment under
both this Section 11(a)(i) and Section
11(a)(ii) hereof, the adjustment provided for
in this Section 11(a)(i) shall be in addition
to, and shall be made prior to, any adjustment
required pursuant to Section 11(a)(ii) hereof.
(ii) In the event any Person
becomes an Acquiring Person, unless the event
causing the 15% threshold to be crossed is a
transaction set forth in Section 13(a) hereof,
or is an acquisition of shares of Common Stock
pursuant to a tender offer or an exchange
offer for all outstanding shares of Common
Stock at a price and on terms determined by at
least a majority of the Continuing Directors to
be in the best interests of the Company and its
stockholders (a "Qualifying Offer"),
then, promptly following the occurrence of such 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 at the then current Purchase Price in
accordance with the terms of this Agreement, in lieu of a
number of one one-hundredths of a share of Preferred
Stock, 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 for which a Right was exercisable immediately prior
to the occurrence of the Section 11(a)(ii) Event, and (y)
dividing that product (which, following such occurrence,
shall thereafter be referred to as the "Purchase Price"
for each Right and for all purposes of this Agreement) by
50% of the current market price (determined pursuant to
Section 11(d) hereof) per share of Common Stock on the
date of such occurrence (such number of shares, the
"Adjustment Shares").
(iii) In the event that the
number of shares of Common Stock which are
authorized by the 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 (the "Current Value") over (2) the
Purchase Price (such excess, 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
exercise of the Right and payment of the
applicable Purchase Price, (1) cash, (2) a
reduction in the Purchase Price, (3) Common
Stock or other equity securities of the Company
(including, without limitation, shares, or
units of shares, of preferred stock which the
Board of Directors of the Company has deemed to
have the same value as shares of Common Stock
(such shares of preferred stock, "common stock
equivalents")), (4) debt securities of the
Company, (5) other assets, or (6) any
combination of the foregoing, having an
aggregate value equal to the Current Value,
where such aggregate value has been determined
by the Board of Directors of the Company based
upon the advice of a nationally recognized
investment banking firm selected by the Board
of Directors of the Company; provided, however,
if the Company shall not have made adequate
provision to deliver value pursuant to clause
(B) above within thirty (30) days following the
later of (x) the occurrence of the Section
11(a)(ii) Event and (y) the date on which the
Company's right of redemption pursuant to
Section 23(a) expires (the later of (x) and (y)
being referred to herein as the "Section
11(a)(ii) Trigger Date"), then the Company
shall be obligated to deliver, upon the
surrender for exercise of a Right and without
requiring payment of the Purchase Price, shares
of Common Stock (to the extent available) and
then, if necessary, cash, which shares and/or
cash have an aggregate value equal to the
Spread. If the Board of Directors of the
Company shall determine in good faith that it
is likely that sufficient additional shares of
Common Stock could be authorized for issuance
upon exercise in full of the Rights, the thirty
(30) day period set forth above may be extended
to the extent necessary, but not more than
ninety (90) days after the Section 11(a)(ii)
Trigger Date, in order that the Company may
seek stockholder approval for the authorization
of such additional shares (such period, as it
may be extended, the "Substitution Period").
To the extent that the Company determines that
some action need 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, and (y) may suspend the exercisability
of the Rights until the expiration of the
Substitution Period in order to seek any
authorization of additional shares and/or to
decide the appropriate form of distribution to
be made pursuant to such first sentence and to
determine the value thereof. In the event of
any such suspension, the Company shall issue a
public announcement stating that the
exercisability of the Rights has been
temporarily suspended, as well as a public
announcement at such time as the suspension is
no longer in effect. For purposes of this
Section 11(a)(iii), the 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
Section 11(a)(ii) Trigger Date and the per
share or per unit value of any "common stock
equivalent" shall be deemed to be equal to the
current market price (as determined pursuant to
Section 11(d) hereof) of the Common Stock on
such date.
(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 forty-five (45) 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 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 of
the Company, whose determination shall be described in a
statement filed with the Rights Agent and shall be
binding on the Rights Agent and the holders of the
Rights. Shares of 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
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 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
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 of the Company, 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, other than computations
made pursuant to Section 11(a)(iii) hereof, the
"current market price" per share of Common
Stock on any date shall be deemed to be the
average of the daily closing prices per share
of such Common Stock for the thirty (30)
consecutive Trading Days (as such term is
hereinafter defined) immediately prior to such
date, and for purposes of computations made
pursuant to Section 11(a)(iii) hereof, the
"current market price" per share of Common
Stock on any date shall be deemed to be the
average of the daily closing prices per share
of such Common Stock for the ten (10)
consecutive Trading Days immediately following
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), or (B) any
subdivision, combination or reclassification of
such Common Stock, and the ex-dividend 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
(30) Trading Day or ten (10) Trading Day
period, as set forth above, then, and in each
such case, the "current market price" shall be
properly adjusted to take into account ex-
dividend trading. The closing price for each
day shall be the last sale price, regular way,
or, in case no such sale takes place on such
day, the average of the closing bid and asked
prices, regular way, in either case as reported
in the principal consolidated transaction
reporting system with respect to securities
listed or admitted to trading on the New York
Stock Exchange or, if the shares of Common
Stock are not listed or admitted to trading on
the New York Stock Exchange, as reported in the
principal consolidated transaction reporting
system with respect to securities listed on the
principal national securities exchange on which
the shares of Common Stock are listed or
admitted to trading or, if the shares of Common
Stock are not listed or admitted to trading on
any national securities exchange, the last
quoted price or, if not so quoted, the average
of the high bid and low asked prices in the
over-the-counter market, as reported by the
National Association of Securities Dealers,
Inc. Automated Quotation System ("NASDAQ") or
such other system then in use, or, if on any
such date the shares of Common Stock are not
quoted by any such organization, the average of
the closing bid and asked prices as furnished
by a professional market maker making a market
in the Common Stock selected by the Board of
Directors of the Company. If on any such date
no market maker is making a market in the
Common Stock, the fair value of such shares on
such date as determined in good faith by the
Board of Directors of the Company shall be
used. The term "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. 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 of the Company,
whose determination shall be described in a
statement filed with the Rights Agent and shall
be conclusive for all purposes.
(ii) For the purpose of any
computation hereunder, the "current market
price" per 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 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 of the Company,
whose determination shall be described in a
statement filed with the Rights Agent and shall
be conclusive for all purposes. For all
purposes of this Agreement, the "current market
price" of one one-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 or
other share or one-millionth of a share of Preferred
Stock, as the case may be. Notwithstanding the first
sentence of this Section 11(e), any adjustment required
by this Section 11 shall be made no later than the
earlier of (i) three (3) years from the date of the
transaction which mandates such adjustment, or (ii) the
Expiration Date.
(f) If as a result of an adjustment made
pursuant to Section 11(a)(ii) 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 and the
Purchase Price thereof 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.
(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, 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, that number of
one one-hundredths of a share of Preferred Stock
(calculated to the nearest one-millionth) obtained by (i)
multiplying (x) the number of one one-hundredths of a
share covered by a Right immediately prior to this
adjustment, by (y) 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 one-ten-
thousandth) obtained by dividing the Purchase Price in
effect immediately prior to adjustment of the Purchase
Price by the Purchase Price in effect immediately after
adjustment of the Purchase Price. The Company shall make
a public announcement of its election to adjust the
number of Rights, indicating the record date for the
adjustment, and, if known at the time, the amount of the
adjustment to be made. 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 (10) 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-hundredths of a share and
the number of one one-hundredths of a share which were
expressed in the initial Rights Certificates issued
hereunder.
(k) Before taking any action that would
cause an adjustment reducing the Purchase Price below the
then stated value, if any, of the number of one one-
hundredths of a share of Preferred Stock issuable upon
exercise of the Rights, the Company shall take any
corporate action which may, in the opinion of its
counsel, be necessary in order that the Company may
validly and legally issue fully paid and nonassessable
such number of one one-hundredths of a share of Preferred
Stock at such adjusted Purchase Price.
(l) In any case in which this Section 11
shall require that an adjustment in the Purchase Price be
made effective as of a record date for a specified event,
the Company may elect to defer until the occurrence of
such event the issuance to the holder of any Right
exercised 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 shall be entitled
to make such reductions in the Purchase Price, in
addition to those adjustments expressly required by this
Section 11, as and to the extent that in their good faith
judgment the Board of Directors of the Company 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,
(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 rights, warrants or other
instruments or securities outstanding or agreements in
effect which would substantially diminish or otherwise
eliminate the benefits intended to be afforded by the
Rights or (y) prior to, simultaneously with or
immediately after such consolidation, merger or sale, the
stockholders of the Person who constitutes, or would
constitute, the "Principal Party" for purposes of Section
13(a) hereof shall have received a distribution of Rights
previously owned by such Person or any of its Affiliates
and Associates.
(o) The Company covenants and agrees
that, after the Distribution Date, it will not, except as
permitted by Section 23 or Section 26 hereof, take (or
permit any Subsidiary to take) any action if at the time
such action is taken it is reasonably foreseeable that
such action will diminish substantially or otherwise
eliminate the benefits intended to be afforded by the
Rights.
(p) Anything in this Agreement to the
contrary notwithstanding, in the event that the Company
shall at any time after the Effective Time 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.
Section 12. Certificate of Adjusted Purchase
Price or Number of Shares. Whenever an adjustment is
made as provided in 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 or cause the Rights Agent to
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 25 hereof. 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, following the
Stock Acquisition Date, directly or indirectly, (x) the
Company shall consolidate with, or merge with and into,
any other Person (other than a Subsidiary of the Company
in a transaction which complies with Section 11(o)
hereof), and the Company shall not be the continuing or
surviving corporation of such consolidation or merger,
(y) any Person (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 cash or any other
property, or (z) the Company shall sell or otherwise
transfer (or one or more of its Subsidiaries shall sell
or otherwise transfer), in one transaction or a series of
related transactions, assets or earning power aggregating
more than 50% of the assets or earning power of the
Company and its Subsidiaries (taken as a whole) 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), then,
and in each such case (except as may be contemplated by
Section 13(d) hereof), proper provision shall be made so
that: (i) each holder of a Right, except as provided in
Section 7(e) hereof, shall thereafter have the right to
receive, upon the exercise thereof at the then current
Purchase Price in accordance with the terms of this
Agreement, such number of validly authorized and issued,
fully paid, nonassessable and freely tradeable shares of
Common Stock of the Principal Party (as such term is
hereinafter defined), not subject to any liens,
encumbrances, rights of first refusal or other adverse
claims, as shall be equal to the result obtained by (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 the
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 occurrence of
the Section 11(a)(ii) Event by the Purchase Price in
effect immediately prior to such first occurrence), and
dividing that product (which, following the first
occurrence of a Section 13 Event, shall be referred to as
the "Purchase Price" for each Right and for all purposes
of this Agreement) 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; (ii) 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; (iii) the term "Company" shall thereafter be
deemed to refer to such Principal Party, it being
specifically intended that the provisions of Section 11
hereof shall apply only to such Principal Party following
the first occurrence of a Section 13 Event; (iv) 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 (v) 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 (x) or (y) of
the first sentence of Section 13(a), the Person
that is the issuer of any securities into which
shares of Common Stock of the Company are
converted in such merger or consolidation, and
if no securities are so issued, the Person that
is the other party to such merger or
consolidation; and
(ii) in the case of any
transaction described in clause (z) 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;
provided, however, that in any such case, (1) 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 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; and (2) in case such Person is a
Subsidiary, directly or indirectly, of more than one
Person, the Common Stocks 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.
(c) The Company shall not consummate any
such consolidation, merger, sale or transfer unless the
Principal Party shall have a sufficient number of
authorized shares of its Common Stock which have not been
issued or reserved for issuance to permit the exercise in
full of the Rights in accordance with this Section 13 and
unless prior thereto the Company and such Principal Party
shall have executed and delivered to the Rights Agent a
supplemental agreement providing for the terms set forth
in paragraphs (a) and (b) of this Section 13 and further
providing that, as soon as practicable after the date of
any consolidation, merger or sale of assets mentioned in
paragraph (a) of 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 will 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
(ii) will deliver to holders of
the Rights historical financial statements for
the Principal Party and each of its Affiliates
which comply in all respects with the
requirements for registration on Form 10 under
the Exchange Act.
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 the 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
(x) and (y) of Section 13(a) if (i) such transaction is
consummated with a Person or Persons who acquired shares
of Common Stock pursuant to a Qualifying Offer (or a
wholly owned subsidiary of 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 tender
offer or exchange 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 tender offer or exchange offer. Upon consummation
of any such transaction contemplated by this Section
13(d), all rights hereunder shall expire.
Section 14. Fractional Rights and Fractional
Shares.
(a) The Company 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 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. The closing
price of the Rights for any day shall be the last sale
price, regular way, or, in case no such sale takes place
on such day, the average of the closing bid and asked
prices, regular way, in either case as reported in the
principal consolidated transaction reporting system with
respect to securities listed or admitted to trading on
the New York Stock Exchange or, if the Rights are not
listed or admitted to trading on the New York Stock
Exchange, as reported in the principal consolidated
transaction reporting system with respect to securities
listed on the principal national securities exchange on
which the Rights are listed or admitted to trading, or if
the Rights are not listed or admitted to trading on any
national securities exchange, the last quoted price or,
if not so quoted, the average of the high bid and low
asked prices in the over-the-counter market, as reported
by NASDAQ or such other system then in use or, if on any
such date the Rights are not quoted by any such
organization, the average of the closing bid and asked
prices as furnished by a professional market maker making
a market in the Rights selected by the Board of Directors
of the Company. If on any such date no such market maker
is making a market in the Rights the fair value of the
Rights on such date as determined in good faith by the
Board of Directors of the Company shall be used.
(b) The Company shall not be required to
issue fractions of shares of Preferred Stock (other than
fractions which are integral multiples of one one-
hundredth of a share of Preferred Stock), which may, at
the option of the Company, be evidenced by depositary
receipts 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). 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 upon exercise
of the Rights or to distribute certificates which
evidence fractional shares of Common Stock. In lieu of
fractional shares of Common Stock, the Company may pay to
the registered holders of Rights Certificates at the time
such Rights are exercised as herein provided an amount in
cash equal to the same fraction of the current market
value of one (1) share of Common Stock. For purposes of
this Section 14(c), the current market value of one (1)
share of Common Stock shall be the closing price of one
(1) share of Common Stock (as determined pursuant to
Section 11(d)(i) hereof) for the Trading Day immediately
prior to the date of such exercise.
(d) The holder of a Right by the
acceptance of the Rights expressly waives his right to
receive any fractional Rights or any fractional shares
upon exercise of a Right, except as permitted by this
Section 14.
Section 15. Rights of Action. All rights of
action in respect of this Agreement 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.
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 last
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 its best 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 on the exercise of the Rights represented
thereby, nor shall anything contained herein or in any
Rights Certificate be construed to confer upon the holder
of any Rights Certificate, as such, any of the rights of
a 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 24 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 reasonable compensation for all services
rendered by it hereunder and, from time to time, on
demand of the Rights Agent, its reasonable expenses and
counsel fees and disbursements and other disbursements
incurred in the administration and execution of this
Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the
Rights Agent for, and to hold it harmless against, any
loss, liability, or expense, incurred without negligence,
bad faith or willful misconduct on the part of the Rights
Agent, for anything done or omitted by the Rights Agent
in connection with the acceptance and administration of
this Agreement, including the costs and expenses of
defending against any claim of liability in the premises.
(b) The Rights Agent shall be protected
and shall incur no liability for or in respect of any
action taken, suffered or omitted by it in connection
with its administration of this Agreement in reliance
upon any 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 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, 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 suffering any action hereunder, such fact or
matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be
conclusively proved and established by a certificate
signed by the Chairman of the Board, the 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 suffered in good faith by it under the
provisions of this Agreement in reliance upon such
certificate.
(c) The Rights Agent shall be liable
hereunder only for its own negligence, bad faith or
willful misconduct.
(d) The Rights Agent shall not be liable
for or by reason of any of the statements of fact or
recitals contained in this Agreement or in the Rights
Certificates 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.
(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, 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 suffered to be taken by it in good faith in
accordance with instructions of any such officer.
(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 legal entity.
(i) The Rights Agent may execute and
exercise any of the rights or powers hereby vested in it
or perform any duty hereunder either itself or by or
through its attorneys or agents, and the Rights Agent
shall not be answerable or accountable for any act,
default, neglect or misconduct of any such attorneys or
agents or for any loss to the Company resulting from any
such act, default, neglect or misconduct; provided,
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 Right
Certificate surrendered to the Rights Agent for exercise
or transfer, the certificate attached to the form of
assignment or form of election to purchase, as the case
may be, has either not been completed or indicates an
affirmative response to clause 1 and/or 2 thereof, the
Rights Agent shall not take any further action with
respect to such requested exercise of transfer without
first consulting with the Company.
Section 21. Change of Rights Agent. The
Rights Agent or any successor Rights Agent may resign and
be discharged from its duties under this Agreement upon
thirty (30) days' notice in writing mailed to the
Company, and to each transfer agent of the Common Stock
and Preferred Stock, by registered or certified mail, and
to the holders of the Rights Certificates by first-class
mail. The Company may remove the Rights Agent or any
successor Rights Agent upon thirty (30) days' notice in
writing, mailed to the Rights Agent or successor Rights
Agent, as the case may be, and to each transfer agent of
the Common Stock and Preferred Stock, by registered or
certified mail, and to the holders of the Rights
Certificates by first-class mail. If the Rights Agent
shall resign or be removed or shall otherwise become
incapable of acting, the Company shall appoint a
successor to the Rights Agent. If the Company shall fail
to make such appointment within a period of thirty (30)
days after giving notice of such removal or after it has
been notified in writing of such resignation or
incapacity by the resigning or incapacitated Rights Agent
or by the holder of a Rights Certificate (who shall, with
such notice, submit his Rights Certificate for inspection
by the Company), then any registered holder of any Rights
Certificate may apply to any court of competent
jurisdiction for the appointment of a new Rights Agent.
Any successor Rights Agent, whether appointed by the
Company or by such a court, shall be a corporation
organized and doing business under the laws of the United
States or of the State of New York (or of any other state
of the United States so long as such corporation is
authorized to do business as a banking institution in the
State of New York), in good standing, having a principal
office in the State of New York, which is authorized
under such laws to exercise corporate trust or stock
transfer powers and is subject to supervision or
examination by federal or state authority and which
either has or is an affiliate of a corporation which has
at the time of its appointment as Rights Agent a combined
capital and surplus of at least $100,000,000. After
appointment, the successor Rights Agent shall be vested
with the same powers, rights, duties and responsibilities
as if it had been originally named as Rights Agent
without further act or deed; but the predecessor Rights
Agent shall deliver and transfer to the successor Rights
Agent any property at the time held by it hereunder, and
execute and deliver any further assurance, conveyance,
act or deed necessary for the purpose. Not later than
the effective date of any such appointment, the Company
shall file notice thereof in writing with the predecessor
Rights Agent and each transfer agent of the Common Stock
and the Preferred Stock, and mail a notice thereof in
writing to the registered holders of the Rights
Certificates. Failure to give any notice provided for in
this Section 21, however, or any defect therein, shall
not affect the legality or validity of the resignation or
removal of the Rights Agent or the appointment of the
successor Rights Agent, as the case may be.
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 (a)
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
hereinafter issued by the Company, and (b) may, in any
other case, if deemed necessary or appropriate by the
Board of Directors of the Company, issue Rights
Certificates representing the appropriate number of
Rights in connection with such issuance or sale;
provided, however, that (i) no such Rights Certificate
shall be issued if, and to the extent that, the Company
shall be advised by counsel that such issuance would
create a significant risk of material adverse tax
consequences to the Company or the Person to whom such
Rights Certificate would be issued, and (ii) no such
Rights Certificate shall be issued if, and to the extent
that, appropriate adjustment shall otherwise have been
made in lieu of the issuance thereof.
Section 23. Redemption and Termination.
(a) The Board of Directors of the Company
may, at its option, at any time prior to the earlier of
(i) the close of business on the tenth Business Day
following the Stock Acquisition Date or (ii) the Final
Expiration Date, 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"). Notwithstanding anything contained
in this Agreement to the contrary, the Rights shall not
be exercisable after the occurrence of the Section
11(a)(ii) Event until such time as the Company's right of
redemption hereunder has expired. The Company may, at
its option, pay the Redemption Price in cash, shares of
Common Stock (based on the "current market price," as
defined in Section 11(d)(i) hereof, of the Common Stock
at the time of redemption) or any other form of
consideration deemed appropriate by the Board of
Directors.
(b) Immediately upon the action of the
Board of Directors of the Company ordering the redemption
of the Rights, evidence of which shall have been filed
with the Rights Agent 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. Promptly after the action of the Board of
Directors ordering the redemption of the Rights, the
Company shall give notice of such redemption to the
Rights Agent and the holders of the then outstanding
Rights by mailing such notice to all such holders at each
holder's last address as it appears upon the registry
books of the Rights Agent or, prior to the Distribution
Date, on the registry books of the transfer agent for the
Common Stock. Any notice which is mailed in the manner
herein provided shall be deemed given, whether or not the
holder receives the notice. Each such notice of
redemption will state the method by which the payment of
the Redemption Price will be made.
Section 24. 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 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 25 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 (20) 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 (20) 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.
(b) In case the Section 11(a)(ii) Event
shall occur, (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 25
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 25. Notices. Notices or demands
authorized by this Agreement to be given or made by the
Rights Agent or by the holder of any Rights Certificate
to or on the Company shall be 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:
R&B Falcon Corporation
0000 Xxxx Xxxx Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Corporate Secretary
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:
American Stock Transfer & Trust Company
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
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
Company.
Section 26. Supplements and Amendments. Prior
to the Distribution Date and subject to the penultimate
sentence of this Section 26, the Company and the Rights
Agent shall, if the Company so directs, supplement or
amend any provision of this Agreement without the
approval of any holders of certificates representing
shares of Common Stock. From and after the Distribution
Date and subject to the penultimate sentence of this
Section 26, the Company and the Rights Agent shall, if
the Company so directs, supplement or amend this
Agreement without the approval of any holders of Rights
Certificates in order (i) to cure any ambiguity, (ii) to
correct or supplement any provision contained herein
which may be defective or inconsistent with any other
provisions herein, (iii) to shorten or lengthen any time
period hereunder, or (iv) to change or supplement the
provisions hereunder in any manner which the Company may
deem necessary or desirable and which shall not adversely
affect the interests of the holders of Rights
Certificates (other than an Acquiring Person or an
Affiliate or Associate of an Acquiring Person); provided,
this Agreement may not be supplemented or amended to
lengthen, pursuant to clause (iii) of this sentence, (A)
a time period relating to when the Rights may be redeemed
at such time as the Rights are not then redeemable, or
(B) any other time period unless such lengthening is for
the purpose of protecting, enhancing or clarifying the
rights of, and/or the benefits to, the holders of 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 26, the Rights Agent shall execute such
supplement or amendment. Notwithstanding anything
contained in this Agreement to the contrary, no
supplement or amendment shall be made which changes the
Redemption Price, the Final Expiration Date, the Purchase
Price or the number of one one-hundredths of a share of
Preferred Stock for which a Right is exercisable;
provided, however, that at any time prior to (i) the
Stock Acquisition Date or (ii) the date that a tender or
exchange offer by any Person (other than the Company, any
Subsidiary of the Company, any employee benefit plan of
the Company or any Subsidiary of the Company, or any
Person or entity organized, appointed or established by
the Company for or pursuant to the terms of any such
plan) is first published or sent or given within the
meaning of Rule 14d-2(a) of the General Rules and
Regulations under the Exchange Act, if upon consummation
thereof, such Person would be the Beneficial Owner of 15%
or more of the shares of Common Stock then outstanding
and if at the time of any amendment or supplement such
tender or exchange offer has not expired or been
terminated, the Board of Directors of the Company may
amend this Agreement to increase the Purchase Price or
extend the Final Expiration Date. Prior to the
Distribution Date, the interests of the holders of Rights
shall be deemed coincident with the interests of the
holders of Common Stock.
Section 27. Successors. All the covenants and
provisions of this Agreement by or for the benefit of the
Company or the Rights Agent shall bind and inure to the
benefit of their respective successors and assigns
hereunder.
Section 28. Determinations and Actions by the
Board of Directors, etc. For all purposes of this
Agreement, any calculation of the number of shares of
Common Stock outstanding at any particular time,
including for purposes of determining the particular
percentage of such outstanding shares of Common Stock of
which any Person is the Beneficial Owner, shall be made
in accordance with the last sentence of Rule 13d-
3(d)(1)(i) of the General Rules and Regulations under the
Exchange Act. The Board of Directors of the Company
(with, where specifically provided for herein, the
concurrence of the Continuing Directors) shall have the
exclusive power and authority to administer this
Agreement and to exercise all rights and powers
specifically granted to the Board (with, where
specifically provided for herein, the concurrence of the
Continuing 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 (with, where specifically provided
for herein, the concurrence of the Continuing Directors)
in good faith, shall (x) be final, conclusive and binding
on the Company, the Rights Agent, the holders of the
Rights and all other parties, and (y) not subject the
Board or the Continuing Directors to any liability to the
holders of the Rights.
Section 29. Benefits of this Agreement.
Nothing in this Agreement shall be construed to give to
any Person other than the Company, the Rights Agent and
the registered holders of the 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 30. Severability. If any term,
provision, covenant or restriction of this Agreement is
held by a court of competent jurisdiction or other
authority to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force
and effect and shall in no way be affected, impaired or
invalidated; provided, however, that notwithstanding
anything in this Agreement to the contrary, if any such
term, provision, covenant or restriction is held by such
court or authority to be invalid, void or unenforceable
and the Board of Directors of the Company determines in
its good faith judgment that severing the invalid
language from this Agreement would adversely affect the
purpose or effect of this Agreement, the right of
redemption set forth in Section 23 hereof shall be
reinstated and shall not expire until the close of
business on the tenth Business Day following the date of
such determination by the Board of Directors. Without
limiting the foregoing, if any provision requiring a
majority of the Board of Directors of the Company to be
Continuing Directors to act is held by any court of
competent jurisdiction or other authority to be invalid,
void or unenforceable, such determination shall then be
made by the Board of Directors of the Company in
accordance with applicable law and the Company's
Certificate of Incorporation and By-Laws.
Section 31. 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 32. Counterparts. This Agreement may
be executed in any number of counterparts and each of
such counterparts shall for all purposes be deemed to be
an original, and all such counterparts shall together
constitute but one and the same instrument.
Section 33. Descriptive Headings. Descriptive
headings of the several Sections of this Agreement are
inserted for convenience only and shall not control or
affect the meaning or construction of any of the
provisions hereof.
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.
Attest: R&B FALCON CORPORATION
By ___________________ By ___________________________
Name: Name:
Title: Title:
Attest: AMERICAN STOCK TRANSFER &
TRUST COMPANY
By ____________________ By ___________________________
Name: Name:
Title: Title:
Exhibit B
[Form of Rights Certificate]
Certificate No. R- _________ Rights
NOT EXERCISABLE AFTER NOVEMBER 1, 2007 OR EARLIER IF
REDEEMED 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.
UNDER CERTAIN CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED
BY AN ACQUIRING PERSON (AS SUCH TERM IS DEFINED IN THE
RIGHTS AGREEMENT) AND ANY SUBSEQUENT HOLDER OF SUCH
RIGHTS MAY BECOME NULL AND VOID. [THE RIGHTS
REPRESENTED BY THIS RIGHTS CERTIFICATE ARE OR WERE
BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME AN
ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE OF AN
ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE
RIGHTS AGREEMENT). ACCORDINGLY, THIS RIGHTS
CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY
BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED IN
SECTION 7(e) OF SUCH AGREEMENT.](1)
Rights Certificate
R&B FALCON CORPORATION
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 __________, 1997 (the
"Rights Agreement"), between R&B Falcon Corporation, a
Delaware corporation (the "Company"), and American Stock
Transfer & Trust Company, a trust company organized under
the State of New York (the "Rights Agent"), to purchase from
the Company at any time prior to 5:00 P.M. (New York City
time) on November 1, 2007 at the office or offices of the
Rights Agent designated for such purpose, or its successors
as Rights Agent, one one-hundredth of a fully paid,
nonassessable share of Series A Junior Participating
Preferred Stock (the "Preferred Stock") of the Company, at a
purchase price of $150 per one one-hundredth of a share (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 shares of
Common Stock of the Company having an equivalent value. The
number of Rights evidenced by this Rights Certificate (and
the number of shares 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
__________, 1997, based on the Preferred Stock as
constituted at such date.
--------------------
1 The portion of the legend in brackets shall be
inserted only if applicable and shall replace the
preceding sentence.
Upon the occurrence of the 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
any such Acquiring Person (as such terms are defined in the
Rights Agreement), (ii) a transferee of any such Acquiring
Person, Associate or Affiliate, or (iii) under certain
circumstances specified in the Rights Agreement, a
transferee of a person who, after such transfer, became an
Acquiring Person, or an Affiliate or Associate of an
Acquiring Person, such Rights shall become null and void and
no holder hereof shall have any right with respect to such
Rights from and after the occurrence of 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.
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, which limitations of rights include the temporary
suspension of the exercisability of such Rights under the
specific circumstances set forth in the Rights Agreement.
Copies of the Rights Agreement are on file at the above-
mentioned office of the Rights Agent and are also available
upon written request to the Rights Agent.
This Rights Certificate, with or without other Rights
Certificates, upon surrender at the 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 earlier of the close of
business on (i) the tenth Business Day following the Stock
Acquisition Date (as such time period may be extended
pursuant to the Rights Agreement), and (ii) the Final
Expiration Date.
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), but in lieu thereof a
cash payment may be made, as provided in the Rights
Agreement.
No holder of this Rights Certificate 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
on the exercise hereof, nor shall anything contained in the
Rights Agreement or herein be construed to confer upon the
holder hereof, as such, any of the rights of a 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 __________, 1997
ATTEST: R&B FALCON CORPORATION
_____________________ By_________________________
Secretary Title:
Countersigned:
AMERICAN STOCK TRANSFER &
TRUST COMPANY
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.
Date: ___________________, ____
____________________________
Signature
Signature Guaranteed:
Certificate
The undersigned hereby certifies by checking the
appropriate boxes that:
(1) this Rights Certificate [ ] is [ ] is not
being sold, assigned and transferred by or on behalf of a
Person who is or was an Acquiring Person or an Affiliate or
Associate of any such Acquiring Person (as such terms are
defined pursuant to the Rights Agreement); and
(2) after due inquiry and to the best knowledge
of the undersigned, 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:
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: R&B FALCON CORPORATION:
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 insert social security
or other identifying number
____________________________________________________________
(Please print name and address)
____________________________________________________________
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 insert social security
or other identifying number
____________________________________________________________
(Please print name and address)
____________________________________________________________
____________________________________________________________
Dated: _______________, ____
___________________________
Signature
Signature Guaranteed:
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 any such Acquiring Person (as such
terms are defined pursuant to the Rights Agreement); and
(2) after due inquiry and to the best knowledge
of the undersigned, it [ ] did [ ] did not acquire the
Rights evidenced by this Rights Certificate from any Person
who is, was or became an Acquiring Person or an Affiliate or
Associate of an Acquiring Person.
Dated: ___________, ____ _____________________________
Signature
Signature Guaranteed:
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.
