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REDHOOK ALE BREWERY, INC.
AND
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
AMENDED AND RESTATED
RIGHTS AGREEMENT
Dated as of May 12, 1999
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AMENDED AND RESTATED RIGHTS AGREEMENT
THIS RIGHTS AGREEMENT is hereby amended and restated as of May
12, 1999, between Redhook Ale Brewery, Incorporated, a
Washington corporation (the "Company"), and ChaseMellon
Shareholder Services, L.L.C., as successor Rights Agent (the
"Rights Agent").
The Board of Directors of the Company has authorized and declared a
dividend of one Right (as hereinafter defined) for each share of Common Stock,
par value $.005 per share, of the Company (the "Common Stock") outstanding at
the Close of Business (as hereinafter defined) on October 2, 1995 (the "Record
Date") and has authorized the issuance of one Right (as such number may
hereafter be adjusted pursuant to the provisions of this Rights Agreement) with
respect to each share of Common Stock that shall become outstanding between the
Record Date and the earliest of the Distribution Date, the Redemption Date or
the Expiration Date (as such terms are hereinafter defined); provided however,
that Rights may be issued with respect to shares of Common Stock that shall
become outstanding after the Distribution Date and prior to the earlier of the
Redemption Date or the Expiration Date in accordance with the provisions of
Section 23. Each Right shall initially represent the right to purchase one
Common Share.
On September 22, 1995, the Company and the Rights Agent (as successor to
this Rights Agreement) entered into a Rights Agreement, which permitted the
amendment thereof. On February 25, 1999, the Board of Directors of the Company
authorized the amendment and restatement of the Rights Agreement.
Accordingly, in consideration of the premises and the mutual agreements
set forth in this Rights Agreement, the Company and the Rights Agent hereby
agree as follows:
SECTION 1 CERTAIN DEFINITIONS
For purposes of this Rights Agreement, the following terms have the
meanings indicated:
"Acquiring Person" shall mean any Person which, alone or together with
all Affiliates and Associates of such Person, shall be the Beneficial Owner of
20% of more of the Common Shares then outstanding, but shall not include (a) the
Company, any Subsidiary of the Company, any employee benefit plan of the Company
or of any of its Subsidiaries, or any Person holding Common Shares for or
pursuant to the terms of any such employee benefit plan, (b) any such Person who
has become such a Beneficial Owner solely because (i) of a change in the
aggregate number of Common Shares outstanding since the last date on which such
Person acquired Beneficial Ownership of any Common Shares or (ii) it acquired
such Beneficial Ownership in the good-faith belief that such acquisition would
not (y) cause such Beneficial Ownership to exceed 20% of the Common Shares then
outstanding and such Person relied in good faith in
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computing the percentage of its Beneficial Ownership on publicly filed reports
or documents of the Company that are inaccurate or out-of-date or (z) otherwise
cause a Distribution Date or the adjustment provided for in Section 11(a) to
occur, or (c) the Affiliated Group, to the extent the Affiliated Group has
become such a beneficial owner solely as a result of one or more of the
following events: (i) the acquisition or purchase by the Affiliated Group of
beneficial ownership of Common Stock, if such purchase or acquisition does not
result in the Affiliated Group holding in excess of 30% in aggregate of the
outstanding Common Stock, as calculated on a Fully Diluted Basis, (ii) any
Involuntary Acquisition by the Affiliated Group, (iii) any increase in the
percentage ownership of the Affiliated Group of the Common Stock resulting
solely from the cancellation, retirement or acquisition by the Company or any
Subsidiary of the Company of any Common Stock or other securities of the
Company, (iv) any purchase or acquisition of beneficial ownership of Common
Stock by the Affiliated Group if the Affiliated Group disposes of shares of
Common Stock equal to the number of shares so purchased or acquired within 10
Business Days of the date of such purchase or acquisition or (v) any other
action by the Affiliated Group if the Affiliated Group eliminates the
consequences of such action within 10 Business Days of the date that it has
occurred. Notwithstanding clause (b) of the prior sentence, if any Person that
is not an Acquiring Person due to such clause (b) does not reduce its percentage
of Beneficial Ownership of Common Shares to below 20% by the Close of Business
on the fifth Business Day after notice from the Company (the date of notice
being the first day) that such Person's Beneficial Ownership of Common Shares so
exceeds 20%, such Person shall, at the end of such five Business Day period,
become an Acquiring Person (and such clause (b) shall no longer apply to such
Person). For purposes of this definition, the determination whether any Person
acted in "good faith" shall be conclusively determined by the Company's Board of
Directors, acting by a vote of those directors of the Company whose approval
would be required to redeem the Rights under Section 24.
"Affiliate" and "Associate" when used with reference to any Person,
shall have the respective meanings ascribed to such terms in Rule 12b-2 of the
General Rules and Regulations under the Exchange Act, as in effect on the date
of this Rights Agreement.
"Affiliated Group" shall mean Anheuser-Xxxxx Companies, Inc. ("A-BC"),
any Subsidiary of A-BC (other than any limited partnership the sole equity
interest in which held by A-BC or any Subsidiary of A-BC is a limited
partnership interest) and any Group of which A-BC or any Subsidiary of A-BC
(other than any limited partnership the sole equity interest in which held by
A-BC or any Subsidiary of A-BC is a limited partnership interest) is a member or
any of the foregoing.
A Person shall be deemed the "Beneficial Owner" of, and shall be deemed
to "beneficially own" and shall be deemed to have "Beneficial Ownership" of, any
securities:
(a) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has the right to acquire within 60 days of
such time pursuant to any agreement, arrangement or understanding (whether or
not in writing), or
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upon the exercise of conversion rights, exchange rights, warrants or options, or
otherwise; provided, however, that a Person shall not be deemed the "Beneficial
Owner" of, or to "beneficially own," securities tendered pursuant to a tender or
exchange offer made by or on behalf of such Person or any of such Person's
Affiliates or Associates until such tendered securities are accepted for payment
or exchange;
(b) 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 (b) as a result of an
agreement, arrangement or understanding to vote such security (1) arising solely
from a revocable proxy or consent given in response to a public proxy or consent
solicitation made pursuant to, and in accordance with, the Exchange Act and the
applicable rules and regulations thereunder, or (2) made in connection with, or
to otherwise participate in, a proxy or consent solicitation made, or to be
made, pursuant to, and in accordance with, the applicable provisions of the
Exchange Act and the applicable rules and regulations thereunder, whether or not
such agreement, arrangement or understanding described in clause (1) or (2)
above, is also then reportable by such Person on Schedule 13D under the Exchange
Act (or any comparable or successor report); or
(c) 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 clause (1)
to subparagraph (b) of this definition) or disposing of any voting securities of
the Company; provided, however, that nothing in this definition shall
cause a person engaged in business as an underwriter of securities to be 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 days after the date of such acquisition.
"Book Value," when used with reference to Common Shares issued by any
Person, shall mean the amount of such Person's equity applicable to each Common
Share, determined (a) in accordance with generally accepted accounting
principles in effect on the date as of which such Book Value is to be
determined, (b) using all the consolidated assets and all the consolidated
liabilities of such Person on the date as of which such Book Value is to be
determined, except that no value shall be included in such assets for goodwill
arising from consummation of a business combination, and (c) after giving effect
to (i) the exercise of all rights, options and warrants to purchase such Common
Shares (other than the Rights), and the conversion of all securities convertible
into such Common Shares, at an exercise or conversion price, per Common Share,
that is less than such Book Value before giving effect to such exercise or
conversion (whether or not exercisability or convertibility is conditioned upon
occurrence
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of a future event), (ii) all dividends and other distributions on the capital
stock of such Person declared prior to the date as of which such Book Value is
to be determined and to be paid or made after such date, and (iii) any other
agreement, arrangement or understanding (written or oral), or transaction or
other action prior to the date as of which such Book Value is to be determined
that would have the effect of thereafter reducing such Book Value.
"Business Combination" shall have the meaning set forth in Section
11(c)(i).
"Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday and
Friday that is not a day on which banking institutions in New York, New York, or
Seattle, Washington, are authorized or obligated by law or executive order to
close.
"Close of Business: on any given date shall mean 5 p.m., New York City
time, on such date; provided, however, that if such date is not a Business Day,
"Close of Business" shall mean 5 p.m., New York City time, on the next
succeeding Business Day.
"Common Shares," when used with reference to the Company prior to a
Business Combination, shall mean the shares of Common Stock of the Company or
any other shares of capital stock of the Company into which the Common Stock
shall be reclassified or changed. "Common Shares," when used with reference to
any Person (other than the Company prior to a Business Combination), shall mean
shares of capital stock of such Person (if such Person is a corporation) of any
class or series, or units of equity interests in such Person (if such Person is
not a corporation) of any class or series, the terms of which do not limit (as a
maximum amount and not merely in proportional terms) the amount of dividends or
income payable or distributable on such class or series or the amount of assets
distributable on such class or series upon any voluntary or involuntary
liquidation, dissolution or winding up of such Person and do not provide that
such class or series is subject to redemption at the option of such Person, or
any shares of capital stock or units of equity interests into which the
foregoing shall be reclassified or changed; provided, however, that, if at any
time there shall be more than one such class or series of capital stock or
equity interests of such Person, "Common Shares" of such Person shall include
all such classes and series substantially in the proportion of the total number
of shares or other units of each such class or series outstanding at such time.
"Common Stock" shall have the meaning set forth in the introductory
paragraph of this Rights Agreement.
"Company" shall have the meaning set forth in the introductory paragraph
of this Rights Agreement; provided, however, that if there is a Business
Combination, "Company" shall have the meaning set forth in Section 11(c)(iii).
The term "control" with respect to any Person shall mean the power to
direct the management and policies of such Person, directly or indirectly, by or
through stock ownership, agency or otherwise, or pursuant to or in connection
with an agreement,
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arrangement or understanding (written or oral) with one or more other Persons by
or through stock ownership, agency or otherwise; and the terms "controlling" and
"controlled" shall have meanings correlative to the foregoing.
"Distribution Date" shall have the meaning set forth in Section 3(b).
"Exchange Act" shall mean the Securities Exchange Act of 1934, as in
effect on the date in question, unless otherwise specifically provided in this
Rights Agreement.
"Exchange Consideration" shall have the meaning set forth in Section
11(b)(i).
"Expiration Date" shall have the meaning set forth in Section 7(a).
"Fully Diluted Basis" shall mean that, for purposes of calculating any
Person's percentage ownership of the Common Stock, except as described below,
all outstanding options or warrants to acquire Common Stock, or securities
convertible or exchangeable into Common Stock, shall be assumed to be exercised,
converted and exchanged into the shares of Common Stock into which they,
pursuant to their terms, may then or thereafter upon the passage of time be
exercised, converted or exchanged. For purposes of determining the aggregate
shares of outstanding Common Stock, unexercised stock options issued to
employees or directors for compensatory purposes pursuant to an employee stock
option or other stock incentive plan approved by a majority of the Qualified
Directors of the Board of Directors of the Company shall not be deemed to have
been exercised except that for purposes of determining the aggregate shares of
Common Stock held by such Person, all such stock options held by such Person
shall be deemed to be exercised.
"Group" shall mean any Group as defined by Sections 13(d)(3) and
14(d)(2) of the Exchange Act.
"Involuntary Acquisition" shall mean, with respect to any Person, the
purchase or acquisition of beneficial ownership of Common Stock by such Person
as a result of any stock split, dividend, distribution, rights offering by the
Company or any Subsidiary of the Company, recapitalization of the Company,
reclassification or other change in the terms of the Securities held by such
Person, adjustment in the conversion or exchange ratio of any convertible or
exchangeable security or exercise, conversion or exchange of any option, right,
warrant or convertible or exchangeable security held by such Person.
"Major Part," when used with reference to the assets of the Company and
its Subsidiaries as of any date, shall mean assets (a) having a fair market
value aggregating 50% or more of the total fair market value of all the assets
of the Company and its Subsidiaries (taken as a whole) as of the date in
question, (b) accounting for 50% or more of the total value (net of depreciation
and amortization) of all the assets of the Company and its Subsidiaries (taken
as a whole) as would be shown on a consolidated or combined balance sheet of the
Company and its Subsidiaries as of the date in question, prepared in accordance
with generally accepted accounting principles then in effect, or (c) accounting
for 50% or more of the total amount of net income or revenues of the Company and
its Subsidiaries (taken as a whole) as would be shown
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on a consolidated or combined statement of income of the Company and its
Subsidiaries for the period of 12 months ending on the last day of the Company's
monthly accounting period next preceding the date in question, prepared in
accordance with generally accepted accounting principles then in effect.
"Market Value," when used with reference to Common Shares on any date,
shall mean the average of the daily closing prices, per share, of such Common
Shares for the period that is the shorter of (a) 30 consecutive Trading Days
immediately prior to the date in question and (b) the number of consecutive
Trading Days beginning on the Trading Day immediately after the date of the
first public announcement of the event requiring a determination of the Market
Value and ending on the Trading Day immediately prior to the record date of such
event; provided, however, that, in the event that the Market Value of such
Common Shares is to be determined in whole or in part during a period following
the announcement by the issuer of such Common Shares of any action of the type
described in Section 12(a) that would require an adjustment thereunder, then,
and in each such case, the Market Value of such Common Shares shall be
appropriately adjusted to reflect the effect of such action on the market price
of such Common Shares. The closing price for each Trading Day shall be the
closing price quoted on the composite tape for securities listed on the New York
Stock Exchange, or, if such securities are not quoted on such composite tape or
if such securities are not listed on such exchange, on the principal United
States securities exchange registered under the Exchange Act (or any recognized
foreign stock exchange) on which such securities are listed or, if such
securities are not listed on any such exchange, the average of the closing bid
and asked quotations with respect to a share of such securities on the National
Association of Securities Dealers, Inc. Automated Quotations System or such
other system then in use or, if no such quotations are available, the average of
the closing bid and asked prices as furnished by a professional market maker
making a market in such securities selected by the Company's Board of Directors.
If on any such Trading Day no market maker is making a market in such
securities, the closing price of such securities on such Trading Day shall be
deemed to be the fair value of such securities as determined in good faith by
the Company's Board of Directors (whose determination shall be described in a
statement filed with the Rights Agent and shall be binding on the Rights Agent,
the holders of Rights and all other Persons).
"Permitted Offer" shall mean (i) 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 members of the Board of Directors who are not officers
or employees of the Company and who are not Acquiring Persons or Affiliates,
Associates, nominees or representatives of an Acquiring Person, after receiving
advice from one or more investment banking firms, to be (a) at a price and on
terms that are fair to and in the best interests of the Company's shareholders
(taking into account all factors that such members of the Board deem relevant
including, without limitation, prices that could reasonably be achieved if the
Company or its assets were sold in an orderly basis designed to realize maximum
value) and (b) otherwise in the best interests of the Company and its
shareholders, or (ii) a tender offer or exchange offer resulting in acceptance
by shareholders holding, in aggregate, 90% or more of the outstanding
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Common Stock (other than shares beneficially owned by the Acquiring Person, by
its Affiliate, and by officers and directors of the Company).
"Person" shall mean an individual, corporation, limited liability
company, partnership, joint venture, association, trust, unincorporated
organization or other entity.
"Preferred Shares" shall mean shares of the Company's Preferred Stock,
par value $.005 per share, having such rights and preferences as shall be set by
the Board of Directors in issuing such shares. Any reference in this Rights
Agreement to Preferred Shares shall be deemed to include any authorized fraction
of a Preferred Share, unless the context otherwise requires.
"Principal Party" shall mean the Surviving Person in a Business
Combination; provided, however, that, if such Surviving Person is a direct or
indirect Subsidiary of any other Person, "Principal Party" shall mean the Person
which is the ultimate parent of such Surviving Person and which is not itself a
Subsidiary of another Person. In the event ultimate control of such Surviving
Person is shared by two or more Persons, "Principal Party" shall mean that
Person which is immediately controlled by such two or more Persons.
"Purchase Price" with respect to each Right shall mean $120, subject to
adjustment as provided herein, and shall be payable in lawful money of the
United States of America. All references herein to the Purchase Price shall mean
the Purchase Price as in effect at the time in question.
"Record Date" shall have the meaning set forth in the introductory
paragraph of this Rights Agreement.
"Redemption Date" shall have the meaning set forth in Section 24(a).
"Redemption Price" with respect to each Right shall mean $.001, as such
amount may from time to time be adjusted in accordance with Section 12. All
references in this Rights Agreement to the Redemption Price shall mean the
Redemption Price as in effect at the time in question.
"Registered Common Shares" shall mean Common Shares that are, as of the
date of consummation of a Business Combination, and have continuously been for
the 12 months immediately preceding such date, registered under Section 12 of
the Exchange Act.
"Right Certificate" shall mean a certificate evidencing a Right in
Substantially the form attached to this Rights Agreement as Exhibit A.
"Right" shall mean the right to purchase Common Shares (or other
securities) as provided in this Rights Agreement.
"Securities Act" shall mean the Securities Act of 1933, as in effect on
the date in question, unless otherwise specifically provided in this Rights
Agreement.
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"Subsidiary" shall mean a Person, at least a majority of the total
outstanding voting power (being the power under ordinary circumstances (and not
merely upon the happening of a contingency) to vote in the election of directors
of such Person (if such Person is a corporation) or to participate in the
management and control of such Person (if such Person is not a corporation)) of
which is owned, directly or indirectly, by another Person or by one or more
other subsidiaries of such other Person or by such other Person or by one or
more other Subsidiaries of such other Person.
"Surviving Person" shall mean (a) the Person which is the continuing or
surviving Person in a consolidation or merger specified in Section 11(c)(i)(A)
or 11(c)(i)(B) or (b) the Person to which the Major Part of the assets of the
Company and its Subsidiaries is sold, leased, exchanged or otherwise transferred
or disposed of in a transaction specified in Section 11(c)(i)(C); provided,
however, that if the Major Part of the assets of the Company and its
subsidiaries is sold, leased, exchanged or otherwise transferred or disposed of
in one or more related transactions specified in Section 11(c)(i)(C) to more
than one Person, the "Surviving Person" in such case shall mean the Person that
acquired assets of the Company and/or its Subsidiaries with the greatest fair
market value in such transaction or transactions.
"Trading Day" shall mean a day on which the principal national
securities exchange (or principal recognized foreign stock exchange, as the case
may be) on which any securities or Rights, as the case may be, are listed or
admitted to trading is open for the transaction of business or, if the
securities or Rights in question are not listed or admitted to trading on any
national securities exchange (or recognized foreign stock exchange, as the case
may be), a Business Day.
SECTION 2 APPOINTMENT OF RIGHTS AGENT
The Company hereby appoints the Rights Agent to act as agent for the
Company in accordance with the terms and conditions of this Rights Agreement,
and the Rights Agent hereby accepts such appointment. The Company may from time
to time appoint one or more co-Rights Agents as it may deem necessary or
desirable (the term "Rights Agent" being used in this Rights Agreement to refer,
collectively, to the Rights Agent together with any such co-Rights Agents). In
the event the Company appoints one or more co-Rights Agents, the respective
duties of the Rights Agent and any co-Rights Agents shall be as the Company
shall determine.
SECTION 3 ISSUE OF RIGHTS AND RIGHT CERTIFICATES
(a) One Right shall be associated with each Common Share
outstanding on the Record Date, each additional Common Share that shall become
outstanding between the Record Date and the earliest of the Distribution Date,
the Redemption Date and the Expiration Date and each additional Common Share
with which Rights are issued after the Distribution Date but prior to the
earlier of the Redemption Date and the Expiration Date as provided in Section
23; provided, however, that if the number of outstanding Rights are combined
into a smaller number of outstanding Rights pursuant to Section 12(a) the
appropriate fractional Right
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determined pursuant to such Section shall thereafter be associated with each
such Common Share.
(b) Until the earlier of(i) the Close of Business on the
tenth Business Day after the Date that the Company learns that a Person has
become an Acquiring Person and (ii) the Close of Business on such date, if any,
as may be designated by the Company's Board of Directors following the
commencement of, or first public disclosure of an intent to commence, 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 of its Subsidiaries,
or any Person holding Common Shares for or pursuant to the terms of any such
employee benefit plan) for outstanding Common Shares, if upon consummation of
such tender or exchange offer such Person could be the Beneficial Owner of 20%
or more of the outstanding Common Shares (unless such Person shall be a member
of the Affiliated Group, in which case the threshold shall be Beneficial
Ownership in excess of 30%, calculated on a Fully-Diluted Basis) (the Close of
Business on the earlier of dates set forth in (i) and (ii) being the
"Distribution Date"), (y) the Rights will be evidenced by the certificates for
Common Shares registered in the names of the holders thereof and not by separate
Right Certificates and (z) the Rights, including the right to receive Right
Certificates, will be transferable only in connection with the transfer of
Common Shares. As soon as practicable after the Distribution Date, the Rights
Agent will send, by first-class, postage-prepaid mail, to each record holder of
Common Shares as of the Distribution Date, at the address of such holder shown
on the records of the Company, a Right Certificate evidencing one whole Right
for each Common Share (or for the number of Common Shares with which one whole
Right is then associated if the number of Rights per Common Share held by such
record holder has been adjusted in accordance with the proviso in Section 3(a)).
If the number of Rights associated with each Common Share has been adjusted in
accordance with the proviso in Section 3(a), at the time of distributing the
Right Certificates the Company may make any necessary and appropriate rounding
adjustments so that Right Certificates representing only whole numbers of Rights
are distributed and cash is paid in lieu of any fractional Right in accordance
with Section 15(a). As of and after the Distribution Date, the Rights will be
evidenced solely by such Right Certificates.
(c) With respect to any certificate for Common Shares, until
the earliest of the Distribution Date, the Redemption Date and the Expiration
Date, the Rights associated with the Common Shares represented by any such
certificate shall be evidenced by such certificate alone, the registered holders
of the Common Shares shall also be the registered holders of the associated
Rights and the surrender for transfer of any such certificate shall also
constitute the transfer of the Rights associated with the Common Shares
represented thereby.
(d) Certificates issued for Common Shares after the Record
Date (including, without limitation, upon transfer or exchange of outstanding
Common Shares), but prior to the earliest of the Distribution Date, the
Redemption Date and the Expiration Date, shall have printed on, written on or
otherwise affixed to them the following legend:
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This certificate also evidences and entitles the holder hereof
to certain Rights as set forth in the Rights Agreement dated as of
September 22, 1995, as it may be amended from time to time (the "Rights
Agreement"), between Redhook Ale Brewery, Incorporated ("Redhook") and
First Interstate Bank of Washington, N.A., as Rights Agent (or between
Redhook and any successor Rights Agent under the Rights Agreement), the
terms of which are hereby incorporated herein by reference and a copy of
which is on file at the principal executive offices of Redhook. 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. Redhook will mail to the holder of this
certificate a copy of the Rights Agreement without charge after receipt
of a written request therefor. Rights beneficially owned by Acquiring
Persons or their Affiliates or Associates (as such terms are defined in
the Rights Agreement) and by any subsequent holder of such Rights are
null and void and nontransferable.
Notwithstanding the requirements of this paragraph (d), the omission of a legend
shall not affect the enforceability of any part of this Rights Agreement or the
rights of any holder of Rights.
SECTION 4 FORM OF RIGHT CERTIFICATES
The Right Certificates (and the form of election to purchase and
form of assignment to be printed on the reverse side thereof) shall be
in substantially the form set forth as Exhibit A 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 Rights Agreement, or as
may be required to comply with any applicable law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any
stock exchange on which the Rights may from time to time be listed, or
to conform to usage. Subject to the provisions of Sections 7, 11 and 23,
the Right Certificates, whenever issued, shall be dated as of the
Distribution Date, and on their face shall entitle the holders thereof
to purchase such number of Preferred Shares as shall be set forth
therein for the Purchase Price set forth therein.
SECTION 5 EXECUTION, COUNTERSIGNATURE AND REGISTRATION
(a) The Right Certificates shall be executed on behalf of
the Company by the Chairman of the Board of Directors, the Chief Executive
Officer, the President, the Chief Operating Officer, the Chief Financial Officer
or a Vice President (whether preceded by any additional title) of the Company,
either manually or by facsimile signature, and have affixed thereon the
Company's seal or a facsimile thereof, which shall be attested by the Secretary,
an Assistant Secretary or a Vice President
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(whether preceded by any additional title, provided that such Vice President
shall not have also executed the Right Certificates) of the Company, either
manually or by facsimile signature. The Right Certificates shall be manually
countersigned by the Rights Agent and shall not be valid or obligatory for any
purpose unless so countersigned. In case any officer of the Company who shall
have signed any of the Right Certificates shall cease to be such an officer of
the Company before countersignature by the Rights Agent and issuance and
delivery by the Company, such Right Certificates may nevertheless be
countersigned by the Rights Agent and issued and delivered by the Company with
the same force and effect as though the person who signed such Right Certificate
had not ceased to be such an officer of the Company; and any Right Certificate
may be signed on behalf of the Company by any person who, at the actual date of
execution of such Right Certificate, shall be a proper officer of the Company to
sign such Right Certificate, although at the date of execution of this Rights
Agreement any such person was not such an officer of the Company.
(b) Following the Distribution Date, the Rights Agent will
keep or cause to be kept, at the office designated in Section 25 (the
"Designated Office"), books for registration and transfer of the Right
Certificates issued under this Rights Agreement. Such books shall show the names
and addresses of the respective holders of the Right Certificates, the number of
Rights evidenced by each Right Certificate, the certificate number of each Right
Certificate and the date of each Right Certificate.
SECTION 6 TRANSFER, SPLIT-UP, COMBINATION AND EXCHANGE OF RIGHT CERTIFICATES;
LOST, STOLEN, DESTROYED OR MUTILATED RIGHT CERTIFICATES;
UNCERTIFICATED RIGHTS
(a) Subject to the provisions of Sections 7(e) and 15, at
any time after the Distribution Date, and at or prior to the Close of Business
on the earlier of the Redemption Date and the Expiration Date, any Right
Certificate or Right Certificates may be transferred, split up, combined or
exchanged for another Right Certificate or Right Certificates representing, in
the aggregate, the same number of Rights as the Right Certificate or Right
Certificates surrendered then represented. Any registered holder desiring to
transfer, split up, combine or exchange any Right Certificate shall make such
request in writing delivered to the Rights Agent and shall surrender the Right
Certificate or Right Certificates to be transferred, split up, combined or
exchanged at the Designated Office of the Rights Agent; provided, however, that
neither the Rights Agent nor the Company shall be obligated to take any action
whatsoever with respect to the transfer of any Right Certificate surrendered for
transfer until the registered holder shall have completed and signed the
certification contained in the form of assignment on the reverse side of such
Right Certificate and shall have provided such additional evidence of the
identify 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 the provisions of Sections 7(e) and 15, countersign and
deliver to the Person entitled thereto a Right Certificate or Right
Certificates, as the case may be, as so requested. The Company may require
payment of a sum sufficient to cover any tax or governmental charge that may be
imposed in connection with any transfer, split-up, combination or exchange of
Right Certificates.
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(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 valid Right Certificate, and, in case of loss, theft or
destruction, of indemnity or security reasonably satisfactory to them, and, at
the Company's request, reimbursement to the Company and the Rights Agent of all
reasonable expenses incidental thereto, and upon surrender to the Rights Agent
and cancellation of the Right Certificate if mutilated, the Company will make a
new Right Certificate of like tenor and deliver such new Right Certificate to
the Rights Agent for delivery to the registered owner in lieu of the Right
Certificate so lost, stolen, destroyed or mutilated.
(c) Notwithstanding any other provision of this Rights
Agreement, the Company and the Rights Agent may amend this Rights Agreement to
provide for uncertificated Rights in addition to or in place of Rights evidenced
by Rights Certificates.
SECTION 7 EXERCISE OF RIGHTS; EXPIRATION DATE OF RIGHTS
(a) Subject to Section 7(e) and except as otherwise provided
in this Rights Agreement (including Section 11), each Right shall entitle the
registered holder thereof, upon exercise thereof as provided in this Rights
Agreement, to purchase for the Purchase Price, at any time after the
Distribution Date and at or prior to the earlier of (i) the Close of Business on
September 22, 2005 (the Close of Business on such date being the "Expiration
Date"), and (ii) the Redemption Date, upon payment of the Purchase Price, one
Common Share, subject to adjustment from time to time as provided in Sections 11
and 12.
(b) The registered holder of any Right Certificate may
exercise the Rights evidenced thereby (except as otherwise provided in this
Rights Agreement) in whole or in part at any time after the Distribution Date,
upon surrender of the Right Certificate, with the form of election to purchase
on the reverse side thereof duly executed, to the Rights Agent at the Designated
Office of the Rights Agent in Seattle, Washington, together with payment of the
Purchase Price for the Common Shares as to which the Rights are exercised, at or
prior to the earlier of (i) the Expiration Date and (ii) the Redemption Date.
(c) Upon receipt of a Right Certificate representing
exercisable Rights, with the form of election to purchase duly executed,
accompanied by payment of the Purchase Price for the Common Shares to be
purchased together with an amount equal to any applicable transfer tax, in
lawful money of the United States of America, in cash or by certified check or
money order payable to the order of the Company, the Rights Agent shall
thereupon (i) either (A) promptly requisition from any transfer agent of the
Common Shares (or make available, if the Rights Agent is the transfer agent)
certificates for the number of Common Shares 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 Common Shares
with a depositary agent under a depositary arrangement, promptly requisition
from the depositary agent depositary receipts representing the number of Common
Shares to be purchased (in
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which case certificates for the Common Shares to be 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 all such requests, (ii)
when appropriate, promptly requisition from the Company the amount of cash to be
paid in lieu of the issuance of fractional shares in accordance with Section 15,
(iii) promptly after receipt of such certificates or depositary receipts, cause
the same to be delivered to or upon the order of the registered holder of such
Right Certificate, registered in such name or names as may be designated by such
holder, and (iv) when appropriate, after receipt promptly deliver such cash to
or upon the order of the registered holder of such Right Certificate.
(d) In case the registered holder of any Right Certificate
shall exercise fewer than all the Rights evidenced thereby, a new Right
Certificate evidencing Rights equivalent to the Rights remaining unexercised
shall be issued by the Rights Agent and delivered to the registered holder of
such Right Certificate or to his or her duly authorized assigns, subject to the
provisions of Section 15.
(e) Notwithstanding anything in this Rights Agreement to the
contrary, any Rights that are at any time beneficially owned by an Acquiring
Person or any Affiliate or Associate of an Acquiring Person shall be null and
void and nontransferable, and any holder of any such Right (including any
purported transferee or subsequent holder) shall not have any right to exercise
or transfer any such Right.
(f) Notwithstanding anything in this Rights Agreement to the
contrary, neither the Rights Agent nor the Company shall be obligated to
undertake any action with respect to a registered holder of any Right
Certificates 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 Right 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.
(g) The Company may temporarily suspend, for a period of
time not to exceed 90 calendar days after the Distribution Date, the
exercisability of the Rights in order to prepare and file a registration
statement under the Securities Act, on an appropriate form, with respect to the
Common Shares purchasable upon exercise of the Rights and permit such
registration statement to become effective, provided, however, that no such
suspension shall remain effective after, and the Rights shall without any
further action by the Company or any other Person become exercisable immediately
upon, the effectiveness of such registration statement. Upon any such
suspension, the Company shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended and shall issue a
further public announcement at such time as the suspension is no longer in
effect. Notwithstanding any provision in this Rights Agreement to the contrary,
the Rights shall not be exercisable in any jurisdiction if the requisite
qualification under the blue sky or
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securities laws of such jurisdiction shall not have been obtained or the
exercise of the Rights shall not be permitted under applicable law.
SECTION 8 CANCELLATION AND DESTRUCTION OF RIGHT CERTIFICATES
All Right Certificates surrendered or presented for the purpose
of exercise, transfer, split-up, combination or exchange shall, and any
Right Certificate surrendered or presented for any purpose that
represents Rights that have become null and void and nontransferable
pursuant to Section 7(e) shall, if surrendered or presented to the
Company or to any of its agents, be delivered to the Rights Agent for
cancellation or in canceled from, or, if surrendered or presented to the
Rights Agent, shall be canceled by it, and no Right Certificates shall
be issued in lieu thereof except as expressly permitted by this Rights
Agreement. The Company shall deliver to the Rights Agent for
cancellation and retirement, and the Rights Agent shall so cancel and
retire, any Right Certificate purchased or acquired by the Company. The
Rights Agent shall deliver all canceled Right Certificates to the
Company, or shall, at the Company's written request, destroy such
canceled Right Certificates, and in such case shall deliver a
certificate of destruction thereof to the Company.
SECTION 9 RESERVATION AND AVAILABILITY OF COMMON SHARES
(a) The Company covenants and agrees that it will cause to
be reserved and kept available out of its authorized and unissued Common Shares
or any authorized and issued Common Shares held in its treasury, free from
preemptive rights or any right of first refusal, a number of Common Shares
sufficient to permit the exercise in full of all outstanding Rights.
(b) In the event that there shall not be sufficient Common
Shares issued but not outstanding, or authorized but unissued, to permit the
exercise or exchange of Rights in accordance with Section 11, the Company
covenants and agrees that it will take all such action as may be necessary to
authorize additional Common Shares for issuance upon the exercise or exchange of
Rights pursuant to Section 11.
(c) The Company covenants and agrees that it will take all
such action as may be necessary to ensure that all Shares delivered upon
exercise or exchange of Rights shall, at the time of delivery of the
certificates for such Common Shares (subject to the payment of the Purchase
Price), be duly and validly authorized and issued and fully paid and
non-assessable shares.
(d) So long as the Common Shares issuable upon the exercise
or exchange of Rights are to be listed on any national securities exchange, the
Company covenants and agrees to use its best efforts to cause, from and after
such time as the Rights become exercisable or exchangeable, all Common Shares
reserved for such issuance to be listed on such securities exchange upon
official notice of issuance upon such exercise or exchange.
(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 that
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may be payable in respect of the issuance or delivery of Right Certificates or
of any Common Shares upon the exercise or exchange of Rights. The Company shall
not, however, be required to pay any transfer tax that may be payable in respect
of any transfer or delivery of Right Certificates to a Person other than or in
respect of the issuance or delivery of certificates for the Common Shares in a
name other than that of, the registered holder of the Right Certificate
evidencing Rights surrendered for exercise or exchange or to issue or deliver
any certificates for Common Shares upon the exercise or exchange of any Rights
until any such tax shall have been paid (any such tax being payable by the
holder of such Right Certificate at the time of surrender) or until it has been
established to the Company's satisfaction that no such tax is due.
SECTION 10 COMMON SHARES RECORD DATE
Each Person in whose name any certificate for Common Shares is
issued upon the exercise or exchange of Rights shall for all purposes be
deemed to have become the holder of record of the Common Shares
represented thereby on, and such certificate shall be dated, the date on
which the Right Certificate evidencing such Rights was duly surrendered
and payment of any Purchase Price (and any applicable transfer taxes)
was made; provided, however, that if the date of such surrender and
payment is a date on which the Common Shares transfer books of the
Company are closed, such Person shall be deemed to have become the
record holder of such shares on, and such certificate shall be dated,
the next succeeding Business day on which the Common Shares transfer
books of the Company are open.
SECTION 11 CERTAIN ADJUSTMENTS IN RIGHTS; EXCHANGE OF RIGHTS FOR SHARES;
BUSINESS COMBINATIONS
(a) Upon a Person becoming an Acquiring Person unless the
event causing such Person to become an Acquiring Person is a Permitted Offer, or
an event described in Section 11(c), then proper provision shall be made so that
each holder of a Right, (except as provided in Section 7(e)), shall thereafter
have a right to receive, upon exercise thereof for the Purchase Price in
accordance with the terms of this Rights Agreement, such number of Common Shares
as shall equal the result obtained by multiplying the Purchase Price by a
fraction, the numerator of which is the number of Common Shares for which a
Right is then exercisable and the denominator of which is 50% of the Market
Value of the Common Shares on a date on which a Person becomes an Acquiring
Person. As soon as practicable after a Person becomes an Acquiring Person
(provided the Company shall not have elected to make the exchange permitted by
Section 11(b)(i) for all outstanding Rights), the Company covenants and agrees
to use its best efforts to:
(i) Prepare and file a registration statement under
the Securities Act, on an appropriate form, with respect to the Common Shares
purchasable upon exercise of the Rights,
(ii) Cause such registration statement to become
effective as soon as practicable after such filing;
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(iii) Cause such registration statement to remain
effective (with a prospectus at all times meeting the requirements of the
Securities Act) until the Expiration Date; and
(iv) Qualify or register the Common Shares
purchasable upon exercise of the Rights under the blue sky or securities laws of
such jurisdictions as may be necessary or appropriate.
(b) (i) The Company's Board of Directors may, at its
option, at any time after a Person becomes an Acquiring Person, mandatorily
exchange all or part of the then-outstanding and exercisable Rights (which shall
not include Rights that shall have become null and void and nontransferable
pursuant to the provisions of Section 7(e)) for consideration per Right
consisting of one-half of the securities that would be issuable at such time
upon the exercise of one Right in accordance with Section 11(a) (the
consideration issuable per Right pursuant to this Section 11(b)(i) being the
"Exchange Consideration"). The Company's Board of Directors may, at its option,
issue, in substitution for Common Shares, Preferred Shares, or other equity
securities that the Board of Directors has deemed to have the same value as
Common Shares if there are sufficient shares of Preferred Shares issued but not
outstanding or authorized but unissued. If the Company's Board of Directors
elects to exchange all the rights for the Exchange Consideration pursuant to
this Section 11(b)(i) prior to the physical distribution of the Right
Certificates, the Corporation may distribute the Exchange Consideration in lieu
of distributing Right Certificates, in which case for purposes of this Rights
Agreements holders of Rights shall be deemed to have simultaneously received and
surrendered for exchange Right Certificates on the date of such distribution.
(ii) Any action of the Company's Board of Directors
ordering the exchange of any Rights pursuant to Section 11(b)(i) shall be
irrevocable and, immediately upon the taking of such action and without any
further action and without any notice, the right to exercise any such Right
pursuant to Section 11(a) shall terminate and the only right thereafter of a
holder of such Right shall be to receive the Exchange Consideration in exchange
for each such Right held by such holder or, if the Exchange Consideration shall
not have been paid, to exercise any such Right pursuant to Section 11(c)(i). The
Company shall promptly give public notice of any such exchange; provided,
however, that the failure to give, or any defect in, such notice shall not
affect the validity of such exchange. The Company promptly shall mail a notice
of any such exchange to all holders of such Rights at their last addresses as
they appear on the registry books of the Rights Agent. Any notice that is mailed
in the manner provided in this Rights Agreement shall be deemed given, whether
or not the holder receives the notice. Each such notice of exchange will state
the method by which the exchange of the Rights for the Exchange Consideration
will be effected and, in the event of any partial exchange, the number of Rights
that will be exchanged. Any partial exchange shall be effected pro rata based on
the number of Rights (other than Rights that shall have become null and void and
nontransferable pursuant to the provisions of Section 7(e)) held by each holder
of Rights.
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(c) (i) In the event that, following a Distribution
Date, directly or indirectly, any transactions specified in the following clause
(A), (B) or (C) of this Section 11(c)(i) (each such transaction being a
"Business Combination") shall be consummated:
(A) the Company shall consolidate with, or merge with and into, any
other Person;
(B) any Person shall merge with and into the Company and, in
connection with such merger, all or part of the Common Shares shall be changed
into or exchanged for capital stock or other securities of the Company or of any
other Person or cash or any other property, or
(C) the Company shall sell, lease, exchange or otherwise transfer or
dispose of (or one or more of its Subsidiaries shall sell, lease, exchange or
otherwise transfer or dispose of), in one or more transactions, the Major Part
of the assets of the Company and its Subsidiaries (taken as a whole) to any
other Person or Persons, then, in each such case, proper provision shall be made
so that each holder of a Right, except as provided in Section 7(e), shall
thereafter have the right to receive, upon the exercise thereof for the Purchase
Price in accordance with the terms of this Rights Agreement, the securities
specified below (or, at such holder's option, if any Business Combination is
consummated at any time after a Person becomes an Acquiring Person, the
securities specified in Section 11(a)):
(1) If the Principal Party in such Business
Combination has Registered Common Shares outstanding, each Right shall
thereafter represent the right to receive, upon the exercise thereof for the
Purchase Price in accordance with the terms of this Rights Agreement, such
number of Registered Common Shares of such Principal Party, free and clear of
all liens, encumbrances or other adverse claims, as shall have an aggregate
Market Value equal to the result obtained by multiplying the Purchase Price by
two, or
(2) If the Principal Party in such Business
Combination does not have Registered Common Shares outstanding, each Right shall
thereafter represent the right to receive, upon the exercise thereof for the
Purchase Price in accordance with the terms of this Rights Agreement, at the
election of the holder of such Right at the time of the exercise thereof, any
of:
(x) such number of Common Shares of the
Surviving Person in such Business Combination as shall have an aggregate Book
Value immediately after giving effect to such Business Combination equal to the
result obtained by multiplying the Purchase Price by two;
(y) such number of Common Shares of the
Principal Party in such Business Combination (if the Principal Party is not also
the Surviving Person in such Business Combination) as shall have an aggregate
Book
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Value immediately after giving effect to such Business Combination equal to the
result obtained by multiplying the Purchase Price by two; or
(z) if the Principal Party in such Business
Combination is an Affiliate of one or more Persons which has Registered Common
Shares outstanding, such number of Registered Common Shares of whichever of such
Affiliates of the Principal Party has Registered Common Shares with the greatest
aggregate Market Value on the date of consummation of such Business Combination
as shall have an aggregate Market Value on the date of such Business Combination
equal to the result obtained by multiplying the Purchase price by two.
(ii) The Company shall not consummate any Business
Combination unless each issuer of Common Shares for which Rights may be
exercised, as set forth in this Section 11(c), shall have sufficient authorized
Common Shares that have not been issued or reserved for issuance (and that
shall, when issued upon exercise thereof in accordance with this Rights
Agreement, be validly issued, fully paid and nonassessable and free of
preemptive rights, rights of first refusal or any other restrictions or
limitations on the transfer or ownership thereof) to permit the exercise in full
of the Rights in accordance with this Section 11(c) and unless prior thereto:
(A) a registration statement under the Securities Act, on an
appropriate form, with respect to the Rights and the Common Shares of such
issuer purchasable upon exercise of the Rights shall be effective under the
Securities Act; and
(B) the Company and each such issuer shall have:
(1) executed and delivered to the Rights Agent a
supplemental agreement providing for the assumption by such issuer of the
obligations set forth in this Section 11(c) (including the obligation of such
issuer to issue Common Shares upon the exercise of Rights in accordance with the
terms set forth in Sections 11(c)(i) and 11(c)(iii) and further providing that
such issuer, at its own expense, will use its best efforts to:
(x) cause a registration statement under the
Securities Act, on an appropriate form, with respect to the Rights and the
Common Shares of such issuer purchasable upon exercise of the Rights to remain
effective (with a prospectus at all times meeting the requirements of the
Securities Act) until the Expiration Date;
(y) qualify or register the Rights and the
Common Shares of such issuer purchasable upon exercise of the Rights under the
blue sky or securities laws of such jurisdictions as may be necessary or
appropriate; and
(z) list the Rights and the Common Shares of
such issuer purchasable upon exercise of the Rights on each national securities
exchange on which the Common Shares were listed prior to the consummation of the
Business Combination or, if the Common Shares were not listed on a national
securities exchange prior to the consummation of the Business Combination, on a
national securities exchange;
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(2) furnished to the Rights Agent a written opinion
of independent counsel stating that such supplemental agreement is a valid,
binding and enforceable agreement of such issuer; and
(3) filed with the Rights Agent a certificate of a
nationally recognized firm of independent accountants setting forth the number
of Common Shares of such issuer that may be purchased upon the exercise of each
Right after the consummation of such Business Combination.
(iii) After consummation of any Business Combination
and subject to the provisions of Sections 11(c)(ii), (A) each issuer of Common
Shares for which Rights may be exercised as set forth in this Section 11(c)
shall be liable for, and shall assume, by virtue of such Business Combination,
all the obligations and duties of the Company pursuant to this Rights Agreement,
(B) the term "Company" shall thereafter be deemed to refer to such issuer, (C)
each such issuer shall take such steps in connection with such consummation as
may be necessary to ensure that the provisions of this Rights Agreement
(including the provisions of Sections 11(a) and 11(b)) shall thereafter be
applicable, as nearly as reasonably may be, in relation to its Common Shares
thereafter deliverable upon the exercise of the Rights, and (D) the number of
Common Shares of each such issuer thereafter receivable upon exercise of any
Right shall be subject to adjustment from time to time in a manner and on terms
as nearly equivalent as practicable to the provisions of Sections 11(a) and
12(a), and the provisions of Sections 7, 9 and 10 with respect to the Common
Shares shall apply, as nearly as reasonably may be, on like terms to any such
Common Shares.
(d) In the event that the number of Common Shares that are
authorized by the Company's articles of incorporation but not outstanding or
reserved for issuance for purposes other than upon exercise of the Rights is not
sufficient to permit the exercise in full of the Rights in accordance with
Section 11, the Company shall, to the extent permitted by applicable law and
regulation, (A) determine the excess of (1) the value of the Common Shares
issuable upon the exercise of a Right (computed using the Current Market Price
used to determine the number of Common Shares) (the "Current Value") over (2)
the Purchase Price (such excess is herein referred to as the "Spread"), and (B)
with respect to each Right, make adequate provision to substitute for the Common
Shares, upon the exercise of the Rights and payment of the applicable Purchase
Price, (1) cash, (2) a reduction in the Purchase Price, (3) Preferred Stock or
other equity securities of the Company (including, without limitation, shares,
or units of shares, of preferred stock that the Board of Directors of the
Company has deemed to have the same value as shares of Common Stock (such shares
of preferred stock are herein referred to as "Common Share 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
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provided, however, if the Company shall not have made adequate provision to
deliver value pursuant to clause (B) above within 30 days following the later of
(x) the first occurrence of the event significant to the rights specifically 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 "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, Common
Shares (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 Common Shares could be authorized for issuance upon
exercise in full of the Rights, the 30-day period set forth above may be
extended to the extent necessary, but not more than 90 days after the Trigger
Date, in order that the Company may seek Shareholder 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(d), 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(d), the value of the Common Shares shall be the Current
Market Price per share of the Common Shares on the Trigger Date and the value of
any Common Share Equivalent shall be deemed to have the same value as the Common
Shares on such date.
SECTION 12 CERTAIN ADJUSTMENTS
(a) To preserve the actual or potential economic value of
the Rights, if at any time after the date of this Rights Agreement there shall
be any change in the Common Shares whether by reason of stock dividends, stock
splits, recapitalizations, mergers, consolidations, combinations or exchanges of
securities, split-ups, split-offs, spin-offs, liquidations, other similar
changes in capitalization, any distribution or issuance of cash, assets,
evidences of indebtedness or subscription rights, options or warrants to holders
of Common Shares (other than the Rights or regular quarterly cash dividends), or
otherwise, then, in each such event the Company's Board of Directors shall make
such appropriate adjustments in the number of Common Shares (or the number and
kind of other securities) issuable upon exercise of each Right, the Purchase
Price and Redemption Price in effect at such time and the number of Rights
outstanding at such time (including the number of Rights or fractional Rights
associated with each Common Share) such that following such adjustment such
event shall not have had the effect or reducing or limiting the benefits the
holders of the Rights would have had absent such event.
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(b) If, as a result of an adjustment made pursuant to
Section 12(a), the holder of any Right thereafter exercised shall become
entitled to receive any securities other than Common Shares, then the number of
such securities so receivable upon exercise of any Right thereafter shall be
subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions of Sections 11(a) and 12(a), and the
provisions of Sections 7, 9 and 10 with respect to the Common Shares shall
apply, as nearly as reasonably may be, on like terms to any such other
securities.
(c) All Rights originally issued by the Company subsequent
to any adjustment made to the amount of Common Shares or other securities
relating to a Right shall evidence the right to purchase, for the Purchase
Price, the adjusted number and kind of securities purchasable from time to time
under this Rights Agreement upon exercise of the Rights, all subject to further
adjustment as provided in this Rights Agreement.
(d) Irrespective of any adjustment or change in the Purchase
Price or the number of Common Shares or number or kind of other securities
issuable upon the exercise of the Rights, the Right Certificates theretofore and
thereafter issued may continue to express the terms that were expressed in the
initial Right Certificates issued under this Rights Agreement.
(e) In any case in which action taken pursuant to Section
12(a) requires that an adjustment 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 issuing to the holder of any Right exercised after such record date
the Common Shares and/or other securities, if any, issuable upon such exercise
over and above the Common Shares and/or other securities, if any, issuable
before giving effect 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 securities upon the
occurrence of the event requiring such adjustment.
SECTION 13 CERTIFICATE OF ADJUSTMENT
Whenever an adjustment is made as provided in Section 11 or 12, the
Company shall (a) promptly prepare a certificate setting forth such adjustment
and a brief statement of the facts accounting for such adjustments, (b) promptly
file with the Rights Agent and with each transfer agent for the Common Shares a
copy of such certificate, and (c) mail a brief summary thereof to each holder of
a Right Certificate (or, prior to the Distribution Date, of the Common Shares)
in accordance with Section 25. The Rights Agent shall be fully protected is
relying on any such certificate and on any adjustment therein contained.
SECTION 14 ADDITIONAL COVENANTS
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(a) Notwithstanding any other provision of this Rights
Agreement, no adjustment to the number of Common Shares (or fractions of a
share) or other securities for which a Right is exercisable or the number of
Rights outstanding or associated with each Common Share or any similar or other
adjustment shall be made or be effective if such adjustment would have the
effect of reducing or limiting the benefits the holders of the Rights would have
had absent such adjustment, including, without limitation, the benefits under
Sections 11 and 12, unless the terms of this Rights Agreement are amended so as
to preserve such benefits.
(b) The Company covenants and agrees that, after the
Distribution Date, except as permitted by Section 26, it will not take (or
permit any Subsidiary of the Company to take) any action if at the time such
action is taken it is reasonably foreseeable that such action will reduce or
otherwise limit the benefits the holders of the Rights would have had absent
such action, including, without limitation, the benefits under Sections 11 and
12. Any action taken by the Company during any period after any Person becomes
an Acquiring Person but prior to the Distribution Date shall be null and void
unless such action could be taken under this Section 14(b) from and after the
Distribution Date.
SECTION 15 FRACTIONAL RIGHTS AND FRACTIONAL SHARES
(a) The Company may, but shall not be required to, issue
fractions of Rights or distribute Right Certificates that evidence fractional
Rights. In lieu of such fractional Rights, the Company may pay to the registered
holders of the Right Certificates with regard to which such fractional Rights
would otherwise be issuable an amount in cash equal to the same fraction of the
current market value of a whole Right. For purposes of this Section 15(a), the
current market value of a whole Right shall be the closing price of the Rights
(as determined pursuant to the second and third sentences of the definition of
Market Value contained in Section 1) for the Trading Day immediately prior to
the date on which such fractional Rights would have been otherwise issuable.
(b) The Company may, but shall not be required to, issue
fractions of Common Shares upon exercise of the Rights or distribute
certificates that evidence fractional Common Shares. In lieu of fractional
Common Shares, the Company may elect to (i) utilize a depository arrangement as
provided by the terms of the Common Shares or (ii) in the case of a fraction of
a Common Share, pay to the registered holders of Right Certificates at the time
such Rights are exercised as provided in this Rights Agreement an amount in cash
equal to the same fraction of the current market value of one Common Share. For
purposes of this Section 15(b), the current Market Value of a Common Share shall
be the closing price of a Common Share (as determined pursuant to the second and
third sentences of the definition of Market Value contained in Section 1) for
the Trading Day immediately prior to the date of such exercise. If, as a result
of an adjustment made pursuant to Section 12(a), the holder of any Right
thereafter exercised shall become entitled to receive any securities other than
Common Shares, the provisions of this Section 15(b) shall apply, as nearly as
reasonably may be, on like terms to such other securities.
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(c) The Company may, but shall not be required to, issue
fractions of Preferred Shares upon exchange of Rights pursuant to Section 11(b),
or to distribute certificates that evidence fractional Preferred Shares. In lieu
of such fractional Preferred Shares, the Company may pay to the registered
holders of Right Certificates with regard to which such fractional Preferred
Shares would otherwise be issuable an amount in cash equal to the same fraction
of the current Market Value of one Common Share as of the date on which a Person
became an Acquiring Person.
(d) The holder of Rights by the acceptance of the Rights
expressly waives his or her right to receive any fractional Rights or any
fractional shares upon exercise of a Right, except as provided in this Section
15.
SECTION 16 RIGHTS OF ACTION
(a) All rights of action in respect of this Rights Agreement
are vested in the respective registered holders of the Right Certificates (and,
prior to the Distribution Date, the registered holders of the Common Shares),
and any registered holder of any Right Certificate (or, prior to the
Distribution Date, of the Common Shares), without the consent of the Rights
Agent or of the holder of any other Right Certificate (or, prior to the
Distribution Date, of the Common Shares) may, in his or her own behalf and for
his or her 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 or her right to exercise the Rights evidenced by such Right Certificate in
the manner provided in such Right Certificate and in the Rights 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 in this Rights Agreement and shall
be entitled to specific performance of the obligations of any Person under, and
injunctive relief against actual or threatened violations of the obligations of
any Person subject to, this Rights Agreement.
(b) Any holder of Rights who prevails in an action to
enforce the provisions of this Rights Agreement shall be entitled to recover the
reasonable costs and expenses, including attorneys' fees, incurred in such
action.
SECTION 17 TRANSFER AND OWNERSHIP OF RIGHTS AND RIGHT CERTIFICATES
(a) Prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of the Common Shares.
(b) After the Distribution Date, the Right Certificates will
be transferable, subject to Section 7(e), only on the registry books of the
Rights Agent if surrendered at the Designated Office, duly endorsed or
accompanied by a proper instrument of transfer.
(c) The Company and the Rights Agent may deem and treat the
Person in whose name a Right Certificate (or, prior to the Distribution Date,
the associated Common Shares certificate) is registered as the absolute owner
thereof and
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of the Rights evidenced thereby (notwithstanding any notations of ownership or
writing on the Right Certificate or the associated certificate for Common Shares
made by anyone other than the Company or the Rights Agent) for all purposes
whatsoever, and neither the Company nor the Rights Agent shall be affected by
any notice to the contrary.
SECTION 18 RIGHT CERTIFICATE HOLDER NOT DEEMED A SHAREHOLDER
No holder, as such, of any Right Certificate shall be entitled to vote
or receive dividends or be deemed for any purpose the holder of the Common
Shares or of any other securities of the Company that may at any time be
issuable on the exercise of the Rights represented thereby, nor shall anything
contained in this Rights Agreement or in any Right Certificate be construed to
confer upon the holder of any Right Certificate, as such, any of the rights of a
shareholder of the Company, including, without limitation, any right to vote for
the election of directors or on any matter submitted to shareholders at any
meeting thereof, or to give or withhold consent to any corporate action, or to
receive notice of meetings or other actions affecting shareholders or to receive
dividends or other distributions or subscription rights, or otherwise, until the
Right or Rights evidenced by such Right Certificate shall have been exercised in
accordance with the provisions of this Rights Agreement.
SECTION 19 CONCERNING THE RIGHTS AGENT
(a) The Company agrees to pay to the Rights Agent reasonable
and customary compensation for all services rendered by it under this Rights
Agreement and, from time to time, on demand of the Rights Agent, its reasonable
expenses and counsel fees and other disbursements incurred in administering and
executing this Rights Agreement and exercising and performing its duties under
this Rights Agreement.
(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 Rights Agreement in reliance on any
Right Certificate or certificate for the Common Shares or for other securities
of the Company, instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent, certificate,
statement, or other paper or document believed by it to be genuine and to be
signed, executed and, where necessary, verified or acknowledged, by the proper
Person or Persons.
SECTION 20 MERGER OR CONSOLIDATION OR CHANGE OF RIGHTS AGENT
(a) Any Person into which the Rights Agent or any successor
Rights Agent may be merged or with which it may be consolidated, or any Person
resulting from any merger or consolidation to which the Rights Agent or any
successor Rights Agent shall be a party, or any Person succeeding to the stock
transfer or corporate trust business of the Rights Agent or any successor Rights
Agent, shall be the successor to the Rights Agent under this Rights Agreement
without the execution or
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filing of any paper or any further act on the part of any of the parties to this
Rights Agreement, provided, however, that such Person would be ineligible for
appointment as a successor Rights Agent under the provisions of Section 22. In
case, at the time such successor Rights Agent shall succeed to the agency
created by this Rights Agreement, any of the Right Certificates shall have been
countersigned but not delivered, any such successor Rights Agent may adopt the
countersignature of the predecessor Rights Agent and deliver such Right
Certificates so countersigned; and, in case at that time any of the Right
Certificates shall not have been countersigned, any successor Rights Agent may
countersign such Right Certificates either in the name of the predecessor Rights
Agent or in the name of the successor Rights Agent; and, in all such cases, such
Right Certificates shall have the full force provided in the Right Certificates
and in this Rights Agreement.
(b) In case at any time the name of the Rights Agent shall
be changed and at such time any of the Right Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the countersignature
under its prior name and deliver Right Certificates so countersigned; and, in
case at that time any of the Right Certificates shall not have been
countersigned, the Rights Agent may countersign such Right Certificates either
in its prior name or in its changed name; and, in all such cases, such Right
Certificates shall have the full force provided in the Right Certificates and in
this Rights Agreement.
SECTION 21 DUTIES OF RIGHTS AGENT
The Rights Agent undertakes the duties and obligations imposed by this
Rights Agreement upon the following terms and conditions, by all of which the
Company and the holders of Right Certificates (or, prior to the Distribution
Date, of the Common Shares), 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, suffered or omitted by it in good faith and in accordance with such
opinion.
(b) Whenever in the performance of its duties under this
Rights Agreement the Rights Agent shall deem it necessary or desirable that any
fact or matter (including, without limitation, the identify of any Acquiring
Person) be proved or established by the Company prior to taking, refraining from
taking or suffering any action under this Rights Agreement, such fact or matter
(unless other evidence in respect thereof be specifically prescribed in this
Rights Agreement) may be deemed to be conclusively proved and established by a
certificate signed by any one of the Chairman of the Board of Directors, the
Chief Executive Officer, the President, the Chief Operating Officer, the Chief
Financial Officer, an Executive Vice President (whether preceded by any
additional title), the Treasurer or the Secretary of the Company and delivered
to the Rights Agent, and such certificate shall be full authorization to the
Rights Agent for any action taken or suffered in good faith by it under the
provisions of this Rights Agreement in reliance upon such certificate.
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(c) The Rights Agent shall be liable under this Rights
Agreement only for its own negligence, bad faith or willful misconduct. Anything
to the contrary notwithstanding, in no event shall the Rights Agent be liable
for special, punitive, indirect, consequential or incidental loss or damage of
any kind whatsoever (including but not limited to lost profits), even if the
Rights Agent has been advised of the likelihood of such loss or damage.
(d) The Rights Agent shall not be liable for or by reason of
any of the statements of fact or recitals contained in this Rights Agreement or
in the Right Certificates (except as to its countersignature thereof) or be
required to verify the same, but all such statements and recitals are and shall
be deemed to have been made by the Company only.
(e) The Rights Agent shall not be under any responsibility
in respect of the validity of this Rights Agreement or the execution and
delivery hereof (except the due execution of this Rights Agreement by the Rights
Agent) or in respect of the validity or executions of any Right Certificate
(except its countersignature thereof); nor shall it be responsible for any
breach by the Company of any covenant or condition contained in this Rights
Agreement or in any Right Certificate; nor shall it be responsible for any
adjustment required under the provisions of Section 11 or 12 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 Right Certificates after actual notice of
any such adjustment); nor shall it by any act under this Rights Agreement be
deemed to make any representation or warranty as to the authorization or
reservation of any Common Shares or other such securities to be issued pursuant
to this Rights Agreement or any Right Certificate or as to whether any Common
Shares or other securities 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 performance
by the Rights Agent of the provisions of this Rights Agreement.
(g) The Rights Agent is hereby authorized and directed to
accept instructions with respect to the performance of its duties under this
Rights Agreement from any one of the Chairman of the Board of Directors, the
Chief Executive Officer, the President, the Chief Operating Officer, the Chief
Financial Officer, a Vice President (whether preceded by any additional title),
the Secretary or the Treasurer of the Company 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 the instructions of any such officer.
(h) The Rights Agent and any shareholders, 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
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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 the Rights Agent under
this Rights Agreement. Nothing in this Rights Agreement 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 under this Rights
Agreement 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 reasonable
care was exercised in the selection and continued employment thereof.
SECTION 22 CHANGE OF RIGHTS AGENT
The Rights Agent or any successor Rights Agent may resign and be
discharged from its duties under this Rights Agreement upon 30 days' notice in
writing mailed to the Company and to each transfer agent of the Common Shares by
registered or certified mail, and to the holders of the Right Certificates (or,
prior to the Distribution Date, of the Common Shares) by first-class mail. The
Company may remove the Rights Agent or any successor Rights Agent upon 30 days'
notice in writing mailed to the Rights Agent or successor Rights Agent, as the
case may be, and to each transfer agent of the Common Shares by registered or
certified mail, and to the holders of the Right Certificates (or, prior to the
Distribution Date, of the Common Shares) 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 30 days after giving notice of
such removal or after it has been notified in writing of such resignation or
incapacity by the resigning or incapacitated Rights Agent or by the holder of a
Right Certificate (or, prior to the Distribution Date, of the Common Shares)
(who shall, with such notice, submit his or her Right Certificate or, prior to
the Distribution Date, the certificate representing his or her Common Shares,
for inspection by the Company), then the registered holder of any Right
Certificate (or, prior to the Distribution Date, of the Common Shares) 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 Person in good standing 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 conduct a stock
transfer or corporate trust business in the state of New York) and having an
office in the State of New York, which is authorized under such laws to exercise
stock transfer or corporate trust powers and is subject to supervision or
examination by federal or state authority and which has at the time of its
appointment as Rights Agent a combined capital and surplus of at least
$50,000,000. 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; provided, however,
that the predecessor Rights Agent shall deliver and transfer to the successor
Rights Agent any property at the time held by it under this Rights Agreement,
and execute and deliver any further
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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 of the Common Shares
and mail a notice thereof in writing to the registered holders of the Right
Certificates (or, prior to the Distribution Date, of the Common Shares). Failure
to give any notice provides for in this Section 22, 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 23 ISSUANCE OF ADDITIONAL RIGHTS AND RIGHT CERTIFICATES
Notwithstanding any of the provisions of this Rights Agreement or of the
Rights to the contrary, the Company may, at its option, issue new Right
Certificates evidencing Rights in such form as may be approved by its Board of
Directors to reflect any adjustment or change made in accordance with the
provisions of this Rights Agreement. In addition, in connection with the
issuance or sale of Common Shares following the Distribution Date and prior to
the earlier of the Redemption Date and the Expiration Date, the Company (a)
shall issue, with respect to Common Shares so issued or sold pursuant to the
exercise of stock options or under any employee plan or arrangement, or upon the
exercise, conversions or exchange of securities, notes or debentures issued by
the Company, and (b) may issue, in any other case, if deemed necessary or
appropriate by the Company's Board of Directors, Right Certificates representing
the appropriate number of Rights in connection with such issuance or sale;
provided, however, that (i) no such Right Certificate shall be issued if, and to
the extent that, the Company 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 Right Certificate would be issued and (ii) no
such Right Certificate shall be issued if, and to the extent that, appropriate
adjustment shall otherwise have been made in lieu of the issuance thereof.
SECTION 24 REDEMPTION AND TERMINATION
(a) The Company's Board of Directors may, at its option, at
any time prior to the earlier of (i) the Close of Business on the tenth Business
Day following the date that the Company learns that a Person has become an
Acquiring Person and (ii) the Expiration Date, order the redemption of all, but
not fewer than all, the then-outstanding Rights at the Redemption Price (the
date of such redemption being the "Redemption Date"), and the Company, at its
option, may pay the Redemption Price either in cash or Common Shares or other
securities of the Company deemed by the Company's Board of Directors, in the
exercise of its sole discretion, to be at least equivalent in value to the
Redemption Price.
(b) Immediately upon the action of the Company's Board of
Directors ordering the redemption of the Rights in accordance with Section
24(a), 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. Within 10 Business Days
after the action of the Company's Board of
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Directors ordering the redemption of the Rights, the Company shall give notice
of such redemption to the holders of the then-outstanding Rights by mailing such
notice to all such holders at their last addresses as they appear 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 Shares. Each such notice or
redemption will state the method by which payment of the Redemption Price will
be made. The notice, if mailed in the manner provided in this Rights Agreement,
shall be conclusively presumed to have been duly given, whether or not the
holder of Rights receives such notice. In any case, failure to give such notice
by mail, or any defect in the notice, to any particular holder of Rights shall
not affect the sufficiency of the notice to other holders of Rights.
SECTION 25 NOTICES
Notices or demands authorized by this Rights Agreement to be given or
made by the Rights Agent or by the holder of a Right Certificate (or, prior to
the Distribution Date, of the Common shares) 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:
Redhook Ale Brewery, Incorporated
Xxxxxxx, XX 00000
Attention: President
Subject to the provisions of Section 22, notices or demands authorized by this
Rights Agreement to be given or made by the Company or by the holder of a Right
Certificate (or, prior to the Distribution Date, of the Common Shares) 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:
ChaseMellon Shareholder Services, L.L.C.
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Notices or demands authorized by this Rights Agreement to be given or made by
the Company or the Rights Agent to any holder of a Right Certificate (or, prior
to the Distribution Date, of the Common Shares) shall be sufficiently given or
made if sent by first-class mail, postage prepaid, addressed to such holder at
such holder's address as shown on the registry books of the Rights Agent or,
prior to the Distribution Date, on the registry books of the transfer agent for
the Common Shares.
SECTION 26 SUPPLEMENTS AND AMENDMENTS
At any time prior to the Distribution Date and subject to the last
sentence of this Section 26, the Company may, and the Rights Agent shall if the
Company so directs, supplement or amend any provision of this Rights Agreement
(including, without limitation, the date on which the Distribution Date shall
occur, the time during which the Rights may be redeemed pursuant to Section 24)
without the approval of any holder of the Rights. From and after the
Distribution Date and subject to applicable law, the
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Company may, and the Rights Agent shall if the Company so directs, amend this
Rights Agreement without the approval of any holder of Right Certificates to (a)
cure any ambiguity or correct or supplement any provision contained in this
Rights Agreement that may be defective or inconsistent with any other provision
of this Rights Agreement, (b) shorten or lengthen any time period, or (c) make
any other provisions in regard to matters or questions arising under this Rights
Agreement that the Company may deem necessary or desirable and that shall not
adversely affect the interests of the holders of Right Certificates (other than
an Acquiring Person or an Affiliate or Associate of an Acquiring Person). Any
supplement or amendment adopted during any period after any Person has become an
Acquiring Person but prior to the Distribution Date shall be null and void
unless such supplement or amendment could have been adopted under the prior
sentence from and after the Distribution Date. Any supplement or amendment to
this Rights Agreement duly approved by the Company shall become effective
immediately upon execution of the Company, whether or not also executed by the
Rights Agent. In addition, notwithstanding anything to the contrary contained in
this Rights Agreement, no supplement or amendment to this Rights Agreement shall
be made that (x) reduces the Redemption Price (except as required by Section
12(a)), (y) provides for an earlier Expiration Date, or (z) changes the last two
sentences in the definition of Acquiring Person contained in Section 1.
SECTION 27 SUCCESSORS
All the covenants and provisions of this Rights 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 under this Rights Agreement.
SECTION 28 BENEFITS OF THIS RIGHTS AGREEMENT; DETERMINATIONS AND ACTIONS BY THE
COMPANY'S BOARD OF DIRECTORS
(a) Nothing in this Rights Agreement shall be construed to
give to any Person other than the Company, the Rights Agent and the registered
holders of the Right Certificates (and, prior to the Distribution Date, of the
Common Shares) any legal or equitable right, remedy or claim under this Rights
Agreement; provided, however, that this Rights Agreement shall be for the sole
and exclusive benefit of the Company, the Rights Agent and the registered
holders of the Right Certificates (and, prior to the Distribution Date, of the
Common Shares).
(b) Except as explicitly otherwise provided in this Rights
Agreement, the Company's Board of Directors shall have the exclusive power and
authority to administer this Rights Agreement and to exercise all rights and
powers specifically granted to the Company's Board of Directors or to the
Company, or as may be necessary or advisable in the administration of this
Rights Agreement, including, without limitation, the right and power to (i)
interpret the provisions of this Rights Agreement and (ii) make all
determinations deemed necessary or advisable for the administration of this
Rights Agreement (including, without limitation, a determination to redeem or
not redeem the Rights or to amend this Rights Agreement and a determination of
whether there is an Acquiring Person).
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SECTION 29 SEVERABILITY; CONFLICT WITH OTHER AGREEMENTS
If any term, provision, covenant or restriction of this Rights 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 Rights Agreement shall remain in full force and effect and
shall in no way be affected, impaired or invalidated. In the event any provision
of this Rights Agreement is found to violate, or conflict with, the terms of the
Investment Agreement in the form entered into between the Company and
Anheuser-Xxxxx, Incorporated, as of October 18, 1994 as such provision relates
to the Affiliated Group, such provision shall be deemed modified to the minimum
extent necessary to eliminate such conflict.
SECTION 30 GOVERNING LAW
This Rights Agreement and each Right Certificate issued under this
Rights Agreement shall be deemed to be a contract made under the laws of the
state of Washington and for all purposes shall be governed by and construed in
accordance with the law of Washington applicable to contract to be made and
performed entirely within Washington.
SECTION 31 COUNTERPARTS, EFFECTIVENESS
This Rights Agreement may be executed in any number of counterparts,
each of which shall for all purposes be deemed to be an original, and all of
which shall together constitute but one and the same instrument. This Rights
Agreement shall be effective as of the Close of Business on the date of this
Rights Agreement first set forth above.
SECTION 32 DESCRIPTIVE HEADINGS
Descriptive headings of the several Sections of this Rights Agreement
are inserted for convenience only and shall not control or affect the meaning or
construction of any of the provisions of this Rights Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Rights Agreement
to be duly executed as of the day and year first above written.
REDHOOK ALE BREWERY, INCORPORATED
By: /s/ XXXX X. XXXXXXX
-------------------------------------
Xxxx Xxxxxxx
Its: President and
Chief Executive Officer
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
By: /s/ XXXXXX X. XXXXXX
-------------------------------------
Its: Assistant Vice President
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TABLE OF CONTENTS
PAGE
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SECTION 1 CERTAIN DEFINITIONS......................................................... 2
SECTION 2 APPOINTMENT OF RIGHTS AGENT................................................. 9
SECTION 3 ISSUE OF RIGHTS AND RIGHT CERTIFICATES...................................... 9
SECTION 4 FORM OF RIGHT CERTIFICATES.................................................. 11
SECTION 5 EXECUTION, COUNTERSIGNATURE AND REGISTRATION................................ 11
SECTION 6 TRANSFER, SPLIT-UP, COMBINATION AND EXCHANGE OF RIGHT CERTIFICATES;
LOST, STOLEN, DESTROYED OR MUTILATED RIGHT CERTIFICATES; UNCERTIFICATED
RIGHTS...................................................................... 12
SECTION 7 EXERCISE OF RIGHTS; EXPIRATION DATE OF RIGHTS............................... 13
SECTION 8 CANCELLATION AND DESTRUCTION OF RIGHT CERTIFICATES.......................... 15
SECTION 9 RESERVATION AND AVAILABILITY OF COMMON SHARES............................... 15
SECTION 10 COMMON SHARES RECORD DATE................................................... 16
SECTION 11 CERTAIN ADJUSTMENTS IN RIGHTS; EXCHANGE OF RIGHTS FOR SHARES;
BUSINESS COMBINATIONS....................................................... 16
SECTION 12 CERTAIN ADJUSTMENTS......................................................... 21
SECTION 13 CERTIFICATE OF ADJUSTMENT................................................... 22
SECTION 14 ADDITIONAL COVENANTS........................................................ 23
SECTION 15 FRACTIONAL RIGHTS AND FRACTIONAL SHARES..................................... 23
SECTION 16 RIGHTS OF ACTION............................................................ 24
SECTION 17 TRANSFER AND OWNERSHIP OF RIGHTS AND RIGHT CERTIFICATES..................... 24
SECTION 18 RIGHT CERTIFICATE HOLDER NOT DEEMED A SHAREHOLDER........................... 25
SECTION 19 CONCERNING THE RIGHTS AGENT................................................. 25
SECTION 20 MERGER OR CONSOLIDATION OR CHANGE OF RIGHTS AGENT........................... 26
SECTION 21 DUTIES OF RIGHTS AGENT...................................................... 26
SECTION 22 CHANGE OF RIGHTS AGENT...................................................... 28
SECTION 23 ISSUANCE OF ADDITIONAL RIGHTS AND RIGHT CERTIFICATES........................ 29
SECTION 24 REDEMPTION AND TERMINATION.................................................. 29
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PAGE
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SECTION 25 NOTICES..................................................................... 30
SECTION 26 SUPPLEMENTS AND AMENDMENTS.................................................. 31
SECTION 27 SUCCESSORS.................................................................. 32
SECTION 28 BENEFITS OF THIS RIGHTS AGREEMENT; DETERMINATIONS AND ACTIONS BY THE
COMPANY'S BOARD OF DIRECTORS................................................ 32
SECTION 29 SEVERABILITY; CONFLICT WITH OTHER AGREEMENTS................................ 32
SECTION 30 GOVERNING LAW............................................................... 33
SECTION 31 COUNTERPARTS, EFFECTIVENESS................................................. 33
SECTION 32 DESCRIPTIVE HEADINGS........................................................ 33
