FIRST AMENDMENT TO RIGHTS AGREEMENT
This Amendment, dated as of November 13, 1996 (the
"Amendment"), between PHH Corporation, a Maryland corporation (the "Company"),
and First Chicago Trust Company of New York (the "Rights Agent").
WHEREAS, the Company and the Rights Agent are parties to a
Rights Agreement dated as of March 15, 1996 (the "Agreement");
WHEREAS, the Company has delivered an appropriate certificate
as described in Section 26 of the Agreement; and
WHEREAS, pursuant to Section 26 of the Agreement, the Company
and the Rights Agent desire to amend the Agreement as set forth below.
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein set forth, the parties hereby agree as follows:
Section 1. Amendments to Section 1.
(a) Section 1(c) of the Agreement relating to the
definitions of "Beneficial Owner" and "beneficially own" is amended by adding
the following at the end thereof:
"Notwithstanding anything contained in this Agreement to the contrary,
neither HFS or Acquisition Corp., nor any of their Affiliates or
Associates, shall be deemed to be the Beneficial Owner of, nor to
beneficially own, any of the Common Shares of the Company solely by
virtue of the approval, execution or delivery of the Merger Agreement
or the consummation of the Merger and the other transactions
contemplated thereby."
(b) Section 1 of the Agreement is amended by adding the
following at the end thereof:
"(q) The following additional terms have the meanings
indicated:
"Acquisition Corp." shall mean Mercury Acq. Corp., a Maryland
corporation.
"HFS" shall mean HFS Incorporated, a Delaware corporation.
"Merger" shall mean the merger of Acquisition Corp. with and into the
Company in accordance with the General Corporation Law of the State of
Maryland upon the terms and subject to the conditions set forth in the
Merger Agreement.
"Merger Agreement" shall mean the Agreement and Plan of Merger, dated
as of November 10, 1996, by and among HFS, Acquisition Corp. and the
Company, but shall not include any amendment to such Merger Agreement."
Section 2. Expiration Date.
Section 7(a) of the Agreement is hereby amended by replacing
the word "or" with a comma immediately prior to the symbol "(ii)" and by adding
to the end thereof the following:
", or (iii) the time immediately prior to the Effective Time (as
defined in the Merger Agreement) of the Merger; whereupon the Rights
shall expire."
Section 3. New Section 35.
The following is added as a new Section 35 to the Agreement:
"Section 35. HFS Merger, etc.
Notwithstanding anything in this Agreement to the contrary,
none of the approval, execution or delivery of the Merger Agreement or the
consummation of the Merger and the other transactions contemplated thereby shall
cause (i) HFS or Acquisition Corp. or any of their Affiliates or Associates to
be deemed an Acquiring Person, (ii) a Share Acquisition Date to occur, (iii) a
Distribution Date to occur in accordance with the terms hereof, which
Distribution Date, if any, shall instead be indefinitely deferred until such
time as the Board of Directors may otherwise determine, or (iv) a Triggering
Event."
Section 4. Severability. If any term, provision, covenant or
restriction of this Amendment 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 Amendment shall remain in
full force and effect and shall in no way be affected, impaired or invalidated.
Section 5. Governing Law. This Amendment shall be deemed to be
a contract made under the laws of the State of Maryland and for all purposes
shall be governed by and construed in accordance with the laws of such State
applicable to contracts made and to be performed entirely within such State.
Section 6. Counterparts. This Amendment may be
executed in any number of counterparts and each of such counterparts shall for
all purposes be deemed to be an original,
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and all such counterparts shall together constitute but one and the same
instrument.
Section 7. Effect of Amendment. Except as expressly
modified herein, the Agreement shall remain in full force and effect.
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment 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: PHH CORPORATION
By: /s/ Xxxxxx X. Xxxxxx By: Xxxxxx X. Xxxxxx
Title: Assistant Secretary Title: Vice President
FIRST CHICAGO TRUST
Attest: COMPANY OF NEW YORK
/s/ Xxxxx Xxxxxxx /s/ Xxxxxx Xxxxxx
By:________________________ By:_____________________________
Title: Customer Service Title: Assistant Vice President
Officer
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