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EXHIBIT 99.2
AMENDED AND RESTATED RIGHTS AGREEMENT
Amended and Restated Rights Agreement, dated as of September 19, 1996,
between Republic Group Incorporated, a Delaware corporation (the "Company"),
and UMB Bank, N.A., as agent (the "Rights Agent").
W I T N E S S E T H:
WHEREAS, the Company and the Rights Agent have previously entered into
that certain Rights Agreement dated as of May 1, 1996 (the "Original Rights
Agreement");
WHEREAS, the Board of Directors of the Company has authorized and
declared a dividend of one common stock purchase right (a "Right") for each
share of Common Stock (as hereinafter defined) of the Company outstanding on
May 16, 1996, each Right representing the right to purchase one share of Common
Stock of the Company, upon the terms and subject to the conditions herein set
forth, and has further authorized the issuance of one Right with respect to
each share of Common Stock that shall become outstanding between May 16, 1996
and the earlier of the Distribution Date, the Redemption Date and the Final
Expiration Date (as such terms are defined in Sections 3 and 7 hereof);
WHEREAS, Section 27 of the Original Rights Agreement permits the
Company, without the consent of the holders of Right Certificates, to amend the
Original Rights Agreement in order to, among other things, make such changes as
the Company may deem necessary or desirable;
WHEREAS, the Company desires to amend the Original Rights Agreement to
provide, in certain instances, for the substitution of fractional shares of
Preferred Stock in lieu of shares of Common Stock, upon exercise of the Rights;
and
WHEREAS, the Company has duly authorized the execution and delivery of
this Amended and Restated Rights Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereby agree as follows:
Section 1. Certain Definitions. For purposes of this Agreement, the
following terms have the meanings indicated:
(a) "Acquiring Person" shall mean any Person (as such term is
hereinafter defined) who or which, together with all Affiliates and
Associates (as such terms are hereinafter defined) of such Person, shall
be the Beneficial Owner (as such term is hereinafter defined) of shares
of Common Stock that constitute 15% or more of the total number of
shares of Common Stock then outstanding, but shall not include the
Company, any wholly-owned Subsidiary (as such term is hereinafter
defined) of the Company or any employee benefit plan of the Company or
any Subsidiary of the Company or any entity holding shares of Common
Stock for or pursuant to the terms
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of such plan or any Exempt Person (but, in the case of an Exempt Person,
only to the extent of any shares of Common Stock (i) Beneficially Owned
by such Exempt Person on the date of this Agreement or (ii) acquired by
such Exempt Person after the date of this Agreement from any other
Exempt Person if such shares have been Beneficially Owned only by Exempt
Persons (except as otherwise contemplated by the last sentence of
Section 1(i) of this Agreement) on and after the date of this
Agreement). Notwithstanding the foregoing, no Person shall become an
"Acquiring Person" as the result of an acquisition of shares of Common
Stock by the Company which by reducing the number of shares outstanding,
increases the proportionate number of shares beneficially owned by such
Person to 15% or more of the shares of Common Stock of the Company then
outstanding; provided, however, that if a Person shall become the
Beneficial Owner of shares of Common Stock that constitute 15% or more
of the shares of Common Stock of the Company then outstanding by reason
of share purchases by the Company and shall, after such share purchases
by the Company, become the Beneficial Owner of any additional shares of
Common Stock of the Company (other than, in the case of an Exempt
Person, shares of Common Stock Beneficial Ownership of which was
acquired by such Exempt Person from another Exempt Person if such shares
have been Beneficially Owned only by Exempt Persons (except as otherwise
contemplated by the last sentence of Section 1(i) of this Agreement) on
and after the date of this Agreement), then such Person shall be deemed
to be an "Acquiring Person." Notwithstanding the foregoing, if the
Board of Directors of the Company determines in good faith that a Person
who would otherwise be an "Acquiring Person," as defined pursuant to the
foregoing provisions of this paragraph (a), has become such
inadvertently, and such Person divests as promptly as practicable a
sufficient number of shares of Common Stock so that such Person would no
longer be an "Acquiring Person," as defined pursuant to the foregoing
provisions of this paragraph (a), then such Person shall not be deemed
to be an "Acquiring Person" for any purposes of this Agreement.
(b) "Affiliate" shall have the meaning ascribed to such term
in Rule 12b-2 of the General Rules and Regulations under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), as in effect on
the date of this Agreement.
"Associate," used to indicate a relationship with any Person,
shall mean (i) any corporation or organization (other than the Company
or a direct or indirect Subsidiary of the Company) of which such Person
is an officer or partner or is, directly or indirectly, the beneficial
owner of 10 percent or more of any class of equity securities, (ii) any
trust or other estate in which such Person has a substantial beneficial
interest or as to which such Person serves as a trustee or in a similar
fiduciary capacity, and (iii) any relative or spouse of such Person, or
any relative of such spouse, who has the same principal residence as
such Person.
(c) A Person shall be deemed the "Beneficial Owner" of and
shall be deemed to "Beneficially Own" any securities:
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(i) which such Person or any of such Person's
Affiliates or Associates beneficially owns, directly or
indirectly;
(ii) which such Person or any of such Person's
Affiliates or Associates has (A) the right to acquire (whether
such right is exercisable immediately or only after the passage
of time) pursuant to any agreement, arrangement or understanding,
or upon the exercise of conversion rights, exchange rights,
rights (other than these Rights), warrants or options, or
otherwise; provided, however, that a Person shall not be deemed
the Beneficial Owner of, or to beneficially own, securities
tendered pursuant to a tender or exchange offer made by or on
behalf of such Person or any of such Person's Affiliates or
Associates until such tendered securities are accepted for
purchase or exchange; or (B) the right to vote pursuant to any
agreement, arrangement or understanding; provided, however, that
a Person shall not be deemed the Beneficial Owner of, or to
beneficially own, any security if the agreement, arrangement or
understanding to vote such security (1) arises solely from a
revocable proxy or consent given to such Person in response to a
public proxy or consent solicitation made pursuant to, and in
accordance with, the applicable rules and regulations of the
Exchange Act and (2) is not also then reportable on Schedule 13D
under the Exchange Act (or any comparable or successor report);
or
(iii) which are beneficially owned, directly or
indirectly, by any other Person with which such Person or any of
such Person's Affiliates or Associates has any agreement,
arrangement or understanding for the purpose of acquiring,
holding, voting (except to the extent contemplated by the proviso
to Section 1(c)(ii)(B)) or disposing of any securities of the
Company;
provided, however, that nothing in this paragraph (c) 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.
(d) "Business Day" shall mean any day other than a Saturday,
Sunday, or a day on which banking institutions in the Kansas City,
Missouri Federal Reserve District are authorized or obligated by law or
executive order to close.
(e) "Close of Business" on any given date shall mean 5:00 p.m.
Hutchinson, Kansas time, on such date; provided, however, that if such a
date is not a Business Day it shall mean 5:00 p.m., Hutchinson, Kansas
time, on the next succeeding Business Day.
(f) "Common Stock" when used with reference to the Company
shall mean shares of Common Stock, $1.00 par value, of the Company,
except that "Common
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Stock" when used with reference to any Person other than the Company
shall mean the capital stock (or equity interest) with the greatest
voting power of such other Person or, if such other Person is a
Subsidiary of another Person, the Person or Persons which ultimately
controls such first-mentioned Person.
(g) "Continuing Director" shall mean (i) any member of the
Board of Directors of the Company, while such Person is a member of the
Board, who is not an Acquiring Person, or an Affiliate or Associate of
an Acquiring Person, or a representative of an Acquiring Person or of
any such Affiliate or Associate, and was a member of the Board prior to
the date of this Agreement, or (ii) any Person who subsequently becomes
a member of the Board, while such Person is a member of the Board, who
is not an Acquiring Person, or an Affiliate or Associate, if such
Person's nomination for election or election to the Board is recommended
or approved by a majority of the Continuing Directors.
(h) "Distribution Date" shall have the meaning assigned to it
in Section 3 hereof.
(i) "Exempt Persons" shall mean, at any particular time, all
Persons falling within any one or more of categories (i) through (vi)
below:
(i) Xxxx Xxxxxxx;
(ii) Xxxxxxxx Xxxxxxx;
(iii) lineal descendants (including persons adopted into
the line of descent) of Xxxx Xxxxxxx and Xxxxxxxx Xxxxxxx;
(iv) spouses of such lineal descendants, including
surviving spouses of deceased lineal descendants and excluding
divorced former spouses of lineal descendants;
(v) trusts or estates of which the principal beneficiary
or beneficiaries are Persons falling within any one or more of
categories (i) through (iv) above and fiduciaries of such trusts
or estates in their capacities as fiduciaries; or
(vi) partnerships (including limited partnerships and
limited liability partnerships), limited liability companies,
corporations, and other entities of which Persons falling within
any one or more of categories (i) through (v) above Beneficially
Own partnership interests or membership interests possessing at
least eighty percent (80%) of the interest in profits and losses
or of the capital of the partnership or limited liability
company, shares possessing at least eighty percent (80%) of the
total voting power of the capital stock of the corporation, or
equity interests representing at least eighty percent (80%) of
the total equity interests of any other entity.
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The fact that one or more beneficiaries of a trust or estate falling
within category (v) above who are not Persons falling within categories
(i) through (iv) above may be deemed to be a Beneficial Owner of all or
a portion of the shares of Common Stock beneficially owned by such trust
or estate solely by reason of being a beneficiary or beneficiaries
thereof shall not remove such trust or estate from the category of
Exempt Person if Persons falling within categories (i) through (iv) are
the principal beneficiary or beneficiaries of such trust or estate.
(j) "Final Expiration Date" shall have the meaning assigned to
it in Section 7(a).
(k) "Person" shall mean any individual, firm, corporation,
partnership, trust, limited liability company or other entity, and shall
include any successor (by merger or otherwise) of such entity.
(l) "Principal Party" shall have the meaning assigned to it in
Section 13.
(m) "Redemption Date" shall have the meaning assigned to it in
Section 7(a).
(n) "Preferred Stock" when used with reference to the Company
shall mean shares of Series C Junior Participating Preferred Stock,
without par value, of the Company having the rights and preferences set
forth in the Form of Certificate of Designations, Preferences and Rights
attached to this Agreement as Exhibit C.
(o) "Purchase Price" shall have the meaning assigned to it in
Section 4.
(p) "Redemption Price" shall have the meaning assigned to it
in Section 23.
(q) "Stock Acquisition Date" shall mean the first date of
public announcement by the Company or an Acquiring Person that an
Acquiring Person has become such.
(r) "Subsidiary" of any Person shall mean any corporation or
other entity of which a majority of the voting power of the voting
equity securities or equity interest is owned, directly or indirectly,
by such Person.
Section 2. Appointment of Rights Agent. The Company hereby appoints
the Rights Agent to act as agent for the Company and the holders of the Rights
(who, in accordance with Section 3 hereof, shall prior to the Distribution Date
also be the holders of the shares of Common Stock) in accordance with the terms
and conditions hereof, and the Rights Agent hereby accepts such appointment.
The Company may from time to time appoint such co-Rights Agents as it may deem
necessary or desirable.
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Section 3. Issue of Right Certificates.
(a) Until the earlier of (i) the tenth day after the Stock
Acquisition Date or (ii) the tenth business day (or such later date as
may be determined by action of the Board of Directors prior to such time
as any Person becomes an Acquiring Person) after the date of
commencement of, or first public announcement of the intent of any
Person (other than the Company, any wholly-owned Subsidiary of the
Company, any employee benefit plan of the Company or of any Subsidiary
of the Company or any entity holding shares of Common Stock for or
pursuant to the terms of any such plan) to commence, a tender or
exchange offer the consummation of which would result in any Person
becoming an Acquiring Person (including any such date which is after the
date of this Agreement and prior to the issuance of the Rights; the
earlier of such dates being herein referred to as the "Distribution
Date"), (x) the Rights will be evidenced (subject to the provision of
paragraph (b) of this Section 3) by the certificates for shares of
Common Stock registered in the names of the holders thereof (which
certificates shall also be deemed to be Right Certificates) and not by
separate Right Certificates, and (y) the right to receive Right
Certificates will be transferable only in connection with the transfer
of Common Stock. 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 Stock as of the Close of Business on the
Distribution Date, at the address of such holder shown on the records of
the Company, a right certificate, in substantially the form of Exhibit A
hereto (a "Right Certificate"), evidencing one Right for each share of
Common Stock so held. As of the Distribution Date, the Rights will be
evidenced solely by such Right Certificates.
(b) On May 16, 1996 or as soon as practicable thereafter, the
Company will send a copy of a Summary of Rights to Purchase Common
Stock, in substantially the form attached hereto as Exhibit B (the
"Summary of Rights"), by first-class, postage-prepaid mail, to each
record holder of Common Stock as of the Close of Business on May 16,
1996, at the address of such holder shown on the records of the Company.
With respect to certificates for shares of Common Stock outstanding as
of May 16, 1996, until the Distribution Date, the Rights will be
evidenced by such certificates registered in the names of the holders
thereof together with a copy of the Summary of Rights. Until the
Distribution Date (or the earlier of the Redemption Date or Final
Expiration Date), the surrender for transfer of any certificate for
shares of Common Stock outstanding on May 16, 1996, with or without a
copy of the Summary of Rights attached thereto, shall also constitute
the transfer of the Rights associated with the shares of Common Stock
represented thereby.
(c) Certificates issued after May 16, 1996 but prior to the
earlier of the Distribution Date or the Redemption Date or the Final
Expiration Date representing shares of Common Stock shall have impressed
on, printed on, written on or otherwise affixed to them a legend in
substantially the following form:
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This certificate also evidences and entitles the holder hereof to
certain rights ("Rights") as set forth in a Rights Agreement
between Republic Group Incorporated and UMB Bank, N.A., as Rights
Agent, dated as of May 1, 1996 (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
Republic Group Incorporated. 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. Republic Group Incorporated will mail to the holder
of this certificate a copy of the Rights Agreement without charge
after receipt of a written request therefor. Under certain
circumstances, as set forth in the Rights Agreement, Rights
issued to any Person who becomes an Acquiring Person (as defined
in the Rights Agreement) may become null and void.
With respect to such certificates containing a legend in
substantially the foregoing form, until the Distribution Date, the
Rights associated with the shares of Common Stock represented by such
certificates shall be evidenced by such certificates alone, and the
surrender for transfer of any such certificate shall also constitute the
transfer of the Rights associated with the shares of Common Stock
represented thereby.
Section 4. Form of Right Certificates. The Right Certificates (and the
forms of election to purchase shares of Common Stock and of assignment to be
printed on the reverse thereof) shall be substantially the same as Exhibit A
hereto and may have such marks of identification or designation and such
legends, summaries or endorsements printed thereon as the Company may deem
appropriate and as are not inconsistent with the provisions of this Agreement,
or as may be required to comply with any applicable law or with any rule or
regulation made pursuant thereto or with any rule or regulation or any stock
exchange on which the Rights may from time to time be listed, or to conform to
usage. Subject to the provisions of Section 22 hereof, the Right Certificates,
in each such case, on their face shall entitle the holders thereof to purchase
such number of shares of Common Stock as shall be set forth therein at the
price per share set forth therein (the "Purchase Price"); provided, however,
the number and kind of securities purchasable upon exercise of each Right and
the Purchase Price shall be subject to adjustment as provided herein.
Section 5. Countersignature and Registration. The Right Certificates
shall be executed on behalf of the Company by its Chairman of the Board, its
President or any Executive Vice President, Senior Vice President or Vice
President, and by the Secretary, an Assistant Secretary, Treasurer or an
Assistant Treasurer of the Company, either manually or by facsimile signature,
and have affixed thereto the Company's seal or a facsimile thereof. The Right
Certificates shall not be valid for any purpose unless countersigned by the
Rights Agent. In case any officer of the Company who shall have signed any of
the Right
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Certificates shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by the Company,
such Right Certificates, nevertheless, may be countersigned by the Rights
Agent, and issued and delivered by the Company with the same force and effect
as though the person who signed such Right Certificates had not ceased to be
such officer of the Company; and any Right Certificate may be signed on behalf
of the Company by any person who, at the actual date of the execution of such
Right Certificate, shall be a proper officer of the Company to sign such Right
Certificate, although at the date of the execution of this Agreement any such
person was not such an officer.
Following the Distribution Date, the Rights Agent will keep or cause to
be kept, at its principal offices, books for registration and transfer of the
Right Certificates issued hereunder. Such books shall show the names and
addresses of the respective holders of the Right Certificates, the number of
Rights evidenced on its face by each of the Right Certificates and the date of
each of the Right Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates. Subject
to the provisions of Section 14 hereof, at any time after the Close of Business
on the Distribution Date, and at or prior to the Close of Business on the
earlier of the Redemption Date or the Final Expiration Date, any Right
Certificate or Right Certificates (other than Right Certificates representing
Rights that have become void pursuant to Section 11(a)(ii) hereof or that have
been exchanged pursuant to Section 24 hereof) may be transferred, split up,
combined or exchanged for another Right Certificate or Right Certificates,
entitling the registered holder to purchase a like number of shares of Common
Stock or other securities as the Right Certificate or Right Certificates
surrendered then entitled such holder to purchase. Any registered holder
desiring to transfer, split up, combine or exchange any Right Certificate shall
make such request in writing in a form acceptable to, and delivered to, the
Rights Agent, and shall surrender the Right Certificate or Right Certificates
to be transferred, split up, combined or exchanged at the principal office of
the Rights Agent. Neither the Rights Agent nor the Company shall be obligated
to take any action whatsoever with respect to the transfer of any such
surrendered Right Certificate until the registered holder shall have completed
and signed the certificate contained in the form of assignment on the reverse
side of such Right Certificate and shall have provided such additional evidence
of the identity of the Beneficial Owner (or former Beneficial Owner) or
Affiliates or Associates thereof as the Company shall reasonably request.
Thereupon the Rights Agent shall 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.
Upon receipt by the Company and the Rights Agent of evidence reasonably
satisfactory to the Rights Agent of the loss, theft, destruction or mutilation
of a Right Certificate, and, in case of loss, theft or destruction, of
indemnity or security reasonably satisfactory to the Rights Agent, and, at the
Company's request, reimbursement to the
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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 Rights Agent will make and deliver a new Right Certificate of
like tenor to the registered owner in lieu of the Right Certificate so lost,
stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price; Expiration Date of
Rights.
(a) The registered holder of any Right Certificate may exercise
the Rights evidenced thereby (except as otherwise provided herein) in
whole or in part at any time after the Distribution Date upon surrender
of the Right Certificate, with the form of election to purchase on the
reverse side thereof duly executed, to the Rights Agent at the principal
office of the Rights Agent, together with payment of the Purchase Price
for each share of Common Stock as to which the Rights are exercised, at
or prior to the Close of Business on the earliest of (i) the Close of
Business on May 16, 2006 (the "Final Expiration Date"), or (ii) the date
on which the Rights are redeemed as provided in Section 23 hereof (the
"Redemption Date"), or (iii) the time at which such Rights are exchanged
as provided for in Section 24 hereof.
(b) The Purchase Price for each share of Common Stock pursuant
to the exercise of a Right shall be, as of May 16, 1996, $45.00, shall
be subject to adjustment from time to time as provided in Sections 11
and 13 hereof and shall be payable in lawful money of the United States
of America in accordance with paragraph (c) below, and as of May 16,
1996 each Right shall entitle the holder thereof to purchase one share
of Common Stock, subject to the terms and conditions herein set forth.
(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 shares to be
purchased and an amount equal to any applicable transfer tax required to
be paid by the holder of such Right Certificate in accordance with
Section 9 in cash, or by certified check or cashier's check payable to
the order of the Company, the Rights Agent shall thereupon promptly (i)
requisition from any transfer agent of the Common Stock certificates for
the number of shares of Common Stock to be purchased and the Company
hereby irrevocably authorizes its transfer agent to comply with all such
requests, (ii) when appropriate, requisition from the Company the amount
of cash to be paid in lieu of issuance of fractional shares in
accordance with Section 14, (iii) promptly after receipt of such
certificates, 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 less than all the Rights evidenced thereby, a new Right
Certificate evidencing Rights equivalent to the Rights remaining
unexercised shall be issued by the Rights Agent
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to the registered holder of such Right Certificate or to his duly
authorized assignee, subject to the provisions of Section 14 hereof.
(e) Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Company shall be obligated to
undertake any action with respect to a registered holder upon the
occurrence of any purported exercise as set forth in this Section 7
unless such registered holder shall have (i) completed and signed the
certificate contained in the form of election to purchase set forth on
the reverse side of the 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.
Section 8. Cancellation and Destruction of Right Certificates. All
Right Certificates surrendered for the purpose of exercise, transfer, split up,
combination or exchange shall, if surrendered to the Company or to any of its
agents, be delivered to the Rights Agent for cancellation or in cancelled form,
or, if surrendered to the Rights Agent, shall be cancelled by it, and no Right
Certificates shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Agreement. The Company shall deliver to the
Rights Agent for cancellation and retirement and the Rights Agent shall so
cancel and retire, any other Right Certificate purchased or acquired by the
Company otherwise than upon the exercise thereof. The Rights Agent shall
destroy such cancelled Right Certificates, and in such case shall deliver a
certificate of destruction thereof to the Company.
Section 9. Reservation and Availability of Common Stock. The Company
covenants and agrees that it will cause to be reserved and kept available out
of its authorized and unissued shares of Common Stock or any shares of Common
Stock held in its treasury, the number of shares of Common Stock that will be
sufficient to permit the exercise in full of all outstanding Rights.
So long as the Common Stock issuable upon the exercise of Rights may be
listed on any national securities exchange, the Company shall use its best
efforts to cause, from and after such time as the Rights become exercisable,
all shares reserved for such issuance to be listed on such exchange upon
official notice of issuance upon such exercise.
The Company covenants and agrees that it will take all such action as
may be necessary to ensure that all Common Stock delivered upon exercise of
Rights shall, at the time of delivery of the certificates for such shares
(subject to payment of the Purchase Price), be duly and validly authorized and
issued and fully paid and nonassessable shares.
The Company further covenants and agrees that it will pay when due and
payable any and all federal and state transfer taxes and charges which may be
payable in respect of the issuance or delivery of the Right Certificates or of
any shares of Common Stock upon the exercise of Rights. The Company shall not,
however, be required to pay any transfer tax which may be payable in respect of
any transfer or delivery of Right Certificates to a person other than, or the
issuances or delivery of certificates for the shares of Common Stock in a
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name other than that of, the registered holder of the Right Certificate
evidencing Rights surrendered for exercise or to issue or deliver any
certificates for shares of Common Stock upon the exercise 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 Stock Record Date. Each person in whose name any
certificate for shares of Common Stock is issued upon the exercise of Rights
shall for all purposes be deemed to have become the holder of record of the
Common Stock represented thereby on, and such certificate shall be dated, the
date upon which the Right Certificate evidencing such Rights was duly
surrendered and payment of the Purchase Price (and any applicable transfer
taxes) was made; provided, however, that if the date of such surrender and
payment is a date upon which the Common Stock 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 Stock transfer books of the Company are open. Prior to
the exercise of the Rights evidenced thereby, the holder of a Right Certificate
shall not be entitled to any rights of a stockholder of the Company for which
the Rights shall he exercisable, including, without limitation, the right to
vote, to receive dividends or other distributions or to exercise any preemptive
rights, and shall not be entitled to receive any notice of any proceedings of
the Company, except as provided herein.
Section 11. Adjustment of Purchase Price, Number of Shares or Number of
Rights. The Purchase Price, the number of shares of Common Stock covered by
each Right and the number of Rights outstanding are subject to adjustment from
time to time as provided in this Section 11.
(a) (i) In the event the Company shall at any time after
the date of this Agreement (A) declare a dividend on the Common
Stock payable in Common Stock, (B) subdivide the outstanding
Common Stock, (C) combine the outstanding Common Stock into a
smaller number of shares of Common Stock or (D) issue any shares
of its capital stock in a reclassification of the Common Stock
(including any such reclassification in connection with a
consolidation or merger in which the Company is the continuing or
surviving corporation), except as otherwise provided in this
Section 11(a), the Purchase Price in effect at the time of the
record date for such dividend or of the effective date of such
subdivision, combination or reclassification, and the number and
kind of shares of capital stock issuable on such date, shall be
proportionately adjusted so that the holder of any Right
exercised after such time shall be entitled to receive the
aggregate number and kind of shares of capital stock which, if
such Right had been exercised immediately prior to such date and
at a time when the Common Stock transfer books of the Company
were open, he would have owned upon such exercise and been
entitled to receive by virtue of such dividend, subdivision,
combination or reclassification; provided, however, that in no
event shall the consideration to be paid upon the exercise of one
Right
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be less than the aggregate par value of the shares of Common
Stock issuable upon exercise of one Right. If an event occurs
which would require an adjustment under both Section 11(a)(i) and
Section 11(a)(ii), the adjustment provided for in this Section
11(a)(i) shall be in addition to, and shall be made prior to, any
adjustment required pursuant to Section 11(a)(ii).
(ii) Subject to Section 24 of this Agreement, in the
event any Person becomes an Acquiring Person, each holder of a
Right shall thereafter have a right to receive, upon exercise
thereof at a price equal to the then current Purchase Price
multiplied by the number of shares of Common Stock for which a
Right is then exercisable, in accordance with the terms of this
Agreement such number of shares of Common Stock as shall equal
the result obtained by (x) multiplying the then current Purchase
Price by the number of shares of Common Stock for which a Right
is then exercisable and dividing that product by (y) 50% of the
then current per share market price of the Company's Common Stock
determined pursuant to Section 11(d) hereof on the date of the
occurrence of such event; provided, however, that if the
transaction that would otherwise give rise to the adjustment is
also subject to the provisions of Section 13, then only the
provisions of Section 13 shall apply and no adjustment shall be
made pursuant to this Section 11 (a)(ii). In the event that any
Person shall become an Acquiring Person and the Rights shall then
be outstanding, the Company shall not take any action which would
eliminate or diminish the benefits intended to be afforded by the
Rights.
From and after the occurrence of such event, any Rights
that are or were acquired or beneficially owned by any Acquiring
Person (or any Associate or Affiliate of such Acquiring Person)
shall be void and any holder of such Rights shall thereafter have
no right to exercise such Rights under any provision of this
Agreement. No Right Certificate shall be issued pursuant to
Section 3 that represents Rights beneficially owned by an
Acquiring Person whose Rights would be void pursuant to the
preceding sentence or any Associate or Affiliate thereof; no
Right Certificate shall be issued at any time upon the transfer
of any Rights to an Acquiring Person whose Rights would be void
pursuant to the preceding sentence or any Associate or Affiliate
thereof or to any nominee of such Acquiring Person, Associate or
Affiliate; and any Right Certificate delivered to the Rights
Agent for transfer to an Acquiring Person or any Associate or
Affiliate whose Rights would be void pursuant to the preceding
sentence shall be cancelled.
(iii) In the event that there shall not be sufficient
Common Stock issued but not outstanding or authorized but
unissued to permit the exercise in full of the Rights in
accordance with the foregoing subparagraph (ii), the Company
shall either (A) take all such action as may be necessary to
authorize additional Common Stock for issuance upon exercise of
the Rights or (B) if the Board of Directors so elects, substitute
for each share of
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Common Stock that would otherwise be issuable upon exercise of a
Right, a number of shares of Preferred Stock or fractions thereof
such that the current per share market price of one share of
Preferred Stock multiplied by such number or fraction is equal to
the current per share market price of one share of Common Stock
as of the date of issuance of such share of Preferred Stock or
fraction thereof and take all such action as may be necessary to
authorize shares of Preferred Stock for issuance upon exercise of
the Rights, including, without limitation, filing a Certificate
of Designations, Preferences and Rights with respect to the
Preferred Stock if not theretofore filed.
(b) In case the Company shall fix a record date for the
issuance of rights, options or warrants to all holders of Common
Stock entitling them (for a period expiring within 45 calendar
days after such record date) to subscribe for or purchase Common
Stock (or shares having the same rights, privileges and
preferences as the Common Stock ("equivalent common stock")) or
securities convertible into Common Stock or equivalent common
stock at a price per share of Common Stock or equivalent common
stock (or having a conversion price per share, if a security
convertible into Common Stock or equivalent common stock) less
than the current per share market price of the Common Stock (as
defined in Section 11(d)) on such record date, the Purchase Price
to be in effect after such record date shall be determined by
multiplying the Purchase Price in effect immediately prior to
such record date by a fraction, the numerator of which shall be
the number of shares of Common Stock outstanding on such record
date plus the number of shares of Common Stock which the
aggregate offering price of the total number of shares of Common
Stock and/or equivalent common stock so to be offered (and/or the
aggregate initial conversion price of the convertible securities
so to be offered) would purchase at such current market price and
the denominator of which shall be the number of shares of Common
Stock outstanding on such record date plus the number of
additional shares of Common Stock and/or equivalent common stock
to be offered for subscription or purchase (or into which the
convertible securities so to be offered are initially
convertible); provided, however, that in no event shall the
consideration to be paid upon the exercise of one Right be less
than the aggregate par value of the shares of Common Stock
issuable upon exercise of one Right. In case such subscription
price may be paid in consideration part or all of which shall be
in a form other than cash, the value of such consideration shall
be as determined in good faith by the Board of Directors of the
Company, whose determination shall be described in a statement
filed with the Rights Agent. Shares of Common Stock owned by or
held for the account of the Company shall not be deemed
outstanding for the purpose of any such computation. Such
adjustment shall be made successively whenever such a record date
is fixed; and in the event that such rights or warrants are not
so issued, the Purchase Price shall be adjusted to be the
Purchase Price which would then be in effect if such record date
had not been fixed.
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(c) In case the Company shall fix a record date for the making
of a distribution to all holders of Common Stock (including any such
distribution made in connection with a consolidation or merger in which
the Company is the continuing corporation) of evidences of indebtedness
or assets (other than (i) a regular periodic cash dividend the record
date for which occurs at a time when there is no Acquiring Person or
(ii) a regular periodic cash dividend, the record date for which occurs
at a time when there is an Acquiring Person, at a rate not in excess of
125% of the rate of the last cash dividend theretofore paid or (iii) a
dividend payable in Common Stock) or subscription rights or warrants
(excluding those referred to in Section 11(b)), the Purchase Price to be
in effect after such record date shall be determined by multiplying the
Purchase Price in effect immediately prior to such record date by a
fraction, the numerator of which shall be the current per share market
price of the Common Stock (as defined in Section 11(d)) on such record
date, less the fair market value (as determined in good faith by the
Board of Directors of the Company, whose determination shall be
described in a statement filed with the Rights Agent) of the portion of
the assets or evidences of indebtedness so to be distributed or of such
subscription rights or warrants applicable to one share of Common Stock
and the denominator of which shall be such current per share market
price of the Common Stock; provided, however, that in no event shall the
consideration to be paid upon the exercise of one Right be less than the
aggregate par value of the shares of Common Stock issuable upon exercise
of one Right. Such adjustments shall be made successively whenever such
a record date is fixed; and in the event that such distribution is not
so made, the Purchase Price shall again be adjusted to be the Purchase
Price which would then be in effect if such record date had not been
fixed.
(d) For the purpose of any computation hereunder, the "current
per share market price" of the Common Stock on any date shall be deemed
to be the average of the daily closing prices per share of such Common
Stock for the 30 consecutive Trading Days (as such term is hereinafter
defined) immediately prior to such date; provided, however, that in the
event that the current per share market price of the Common Stock is
determined during a period following the announcement by the issuer of
such Common Stock of a dividend or distribution on such Common Stock
payable in such shares of Common Stock or securities convertible into
such shares of Common Stock and prior to the expiration of 30 Trading
Days after the ex-dividend date for such dividend or distribution, then,
and in each such case, the current market price shall be appropriately
adjusted to reflect the current market price per Common Stock
equivalent. The closing price for each day shall be the last sale
price, regular way, or, in case no such sale takes place on such day,
the average of the closing bid and asked prices, regular way, in either
case as reported in the principal consolidated transaction reporting
system with respect to securities listed or admitted to trading on the
New York Stock Exchange or, if the shares of Common Stock are not listed
or admitted on the New York Stock Exchange, as reported in the principal
consolidated transaction reporting system with respect to securities
listed on the principal national securities exchange on which the shares
of Common Stock are listed or admitted to trading, or, if the shares of
Common Stock are not listed or
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admitted to trading on any national securities exchange, the last quoted
price or, if not so quoted, the average of the high bid and low asked
prices in the over-the-counter market, as reported by the Nasdaq
National Market ("NASDAQ") or such other system then in use, or, if on
any such date the shares of Common Stock are not quoted by any such
organization, the average of the closing bid and asked prices as
furnished by a professional market maker making a market in the shares
of Common Stock selected by the Board of Directors of the Company. The
term "Trading Day" shall mean a day on which the principal national
securities exchange on which the shares of Common Stock are listed or
admitted to trading is open for the transaction of business or, if the
shares of Common Stock are not listed or admitted to trading on any
national securities exchange, a Monday, Tuesday, Wednesday, Thursday or
Friday on which the New York Stock Exchange is not closed. For the
purpose of any computation hereunder, the "current per share market
price" of the Preferred Stock shall be determined in accordance with the
method set forth above in this Section 11(d). If the Preferred Stock is
not publicly traded, the "current per share market price" of the
Preferred Stock shall be conclusively deemed to be the current per share
market price of a share of Common Stock as determined pursuant to this
Section 11(d) (appropriately adjusted to reflect any stock split, stock
dividend or similar transaction occurring after the date hereof),
multiplied by two thousand. If neither the Common Stock nor the
Preferred Stock is publicly held or so listed or traded, "current market
price" per share shall mean the fair value per share as determined in
good faith by the Board of Directors of the Company, whose determination
shall be described in a statement filed with the Rights Agent.
(e) No adjustment in the Purchase Price shall be required
unless such adjustment would require an increase or decrease of at least
1% in the Purchase Price; provided, however, that any adjustments which
by reason of this Section 11(e) are not required to be made shall be
carried forward and taken into account in any subsequent adjustment.
All calculations under this Section 11 shall be made to the nearest cent
or to the nearest ten-thousandth of a share of Common Stock or Preferred
Stock, as the case may be. Notwithstanding the first sentence of this
Section 11(e), any adjustment required by this Section 11 shall be made
no later than the earlier of (i) three years from the date of the
transaction which requires such adjustment or (ii) the date of the
expiration of the right to exercise any Rights.
(f) If as a result of an adjustment made pursuant to Section
11(a), the holder of any Right thereafter exercised shall become
entitled to receive any shares of capital stock of the Company other
than shares of Common Stock, thereafter the number of such other shares
so receivable upon exercise of any Right shall be subject to adjustment
from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the shares contained in
Section 11(a), (b), (c), (g), (h), (i), (j), (k) and (m) and the
provisions of Sections 7, 9, 10 and 13 with respect to the shares of
Common Stock shall apply on like terms to any such other shares.
-15-
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(g) All Rights originally issued by the Company subsequent to
any adjustment made to the Purchase Price hereunder shall evidence the
right to purchase, at the adjusted Purchase Price, the number of shares
of Common Stock purchasable from time to time hereunder upon exercise of
the Rights, all subject to further adjustment as provided herein.
(h) Unless the Company shall have exercised its election as
provided in Section 11(i), upon each adjustment of the Purchase Price as
a result of the calculations made in Section 11(b) and (c), each Right
outstanding immediately prior to the making of such adjustment shall
thereafter evidence the right to purchase, at the adjusted Purchase
Price, that number of shares of Common Stock (calculated to the nearest
ten-thousandth) obtained by (i) multiplying the number of shares covered
by a Right immediately prior to this adjustment by (y) the Purchase
Price in effect immediately prior to such adjustment of the Purchase
Price and (ii) dividing the product so obtained by the Purchase Price in
effect immediately after such adjustment of the Purchase Price.
(i) The Company may elect on or after the date of any
adjustment of the Purchase Price to adjust the number of Rights, in
substitution for any adjustment in the number of shares of Common Stock
purchasable upon the exercise of a Right. Each of the Rights
outstanding after such adjustment of the number of Rights shall be
exercisable for the number of shares of Common Stock for which a Right
was exercisable immediately prior to such adjustment. Each Right held
of record prior to such adjustment of the number of Rights shall become
that number of Rights (calculated to the nearest ten-thousandth)
obtained by dividing the Purchase Price in effect immediately prior to
adjustment of the Purchase Price by the Purchase Price in effect
immediately after adjustment of the Purchase Price. The Company shall
make a public announcement of its election to adjust the number of
Rights, indicating the record date for the adjustment, and, if known at
the time, the amount of the adjustment to be made. This record date may
be the date on which the Purchase Price is adjusted or any day
thereafter, but, if the Right Certificates have been issued, shall be at
least 10 days later than the date of the public announcement. If Right
Certificates have been issued, upon each adjustment of the number of
Rights pursuant to this Section 11(i), the Company shall, as promptly as
practicable, cause to be distributed to holders of record of Right
Certificates on such record date Right Certificates evidencing, subject
to Section 14 hereof, the additional Rights to which such holders shall
be entitled as a result of such adjustment, or, at the option of the
Company, shall cause to be distributed to such holders of record in
substitution and replacement for the Right Certificates held by such
holders prior to the date of adjustment, and upon surrender thereof, if
required by the Company, new Right Certificates evidencing all the
Rights to which such holders shall be entitled after such adjustment.
Right Certificates so to be distributed shall be issued, executed and
countersigned in the manner provided for herein and shall be registered
in the manner provided for herein and shall be registered in the names
of the holders of record of Right Certificates on the record date
specified in the public announcement.
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(j) Irrespective of any adjustment or change in the Purchase
Price or the number of shares of Common Stock issuable upon the exercise
of the rights, the Right Certificates theretofore and thereafter issued
may continue to express the Purchase Price per share and the number of
shares which were expressed in the initial Right Certificates issued
hereunder.
(k) Before taking any action that would cause an adjustment
reducing the Purchase Price below the then par value, if any, of the
shares of Common Stock issuable upon exercise of the Rights, the Company
shall take any corporate action which may, in the opinion of its
counsel, be necessary in order that the Company may validly and legally
issue fully paid and nonassessable shares of Common Stock at such
adjusted Purchase Price.
(l) In any case in which this Section 11 shall require that an
adjustment in the Purchase Price be made effective as of a record date
for a specified event, the Company may elect to defer until the
occurrence of such event the issuing, to the holder of any Right
exercised after such record date, of the shares of Common Stock and
other capital stock or securities of the Company, if any, issuable upon
such exercise over and above the shares of Common Stock and other
capital stock or securities of the Company, if any, issuable upon such
exercise on the basis of the Purchase Price in effect prior to such
adjustment; provided, however, that the Company shall deliver to such
holder a due xxxx or other appropriate instrument evidencing such
holder's right to receive such additional shares upon the occurrence of
the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary
notwithstanding, the Company shall be entitled to make such reductions
in the Purchase Price, in addition to those adjustments expressly
required by this Section 11, as and to the extent that it in its sole
discretion shall determine to be advisable in order that any
consolidation or subdivision of the Common Stock, issuance wholly for
cash, if any, of Common Stock at less than the current market price,
issuance wholly for cash of Common Stock or securities which by their
terms are convertible into or exchangeable for Common Stock, dividends
on Common Stock payable in Common Stock or issuance of rights, options
or warrants referred to hereinabove in subsection (b) of this Section
11, hereafter made by the Company to holders of its Common Stock shall
not be taxable to such stockholders.
Section 12. Certificate of Adjusted Purchase Price or Number of Shares.
Whenever an adjustment is made as provided in Sections 11 and 13 hereof, the
Company shall (a) promptly prepare a certificate setting forth such adjustment,
and a brief statement of the facts accounting for such adjustment, (b) promptly
file with the Rights Agent and with each transfer agent for the Common Stock a
copy of such certificate and (c) mail a brief summary thereof to each holder of
a Right Certificate in accordance with Section 26 hereof.
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Section 13. Consolidation, Merger or Sale or Transfer of Assets or
Earning Power.
(a) In the event, directly or indirectly, at any time after a
Person has become an Acquiring Person, (i) the Company shall consolidate
with, or merge with and into, any other Person, (ii) any Person shall
consolidate with the Company, or merge with and into the Company and the
Company shall be the continuing or surviving corporation of such merger
and, in connection with such merger, all or part of the Common Stock
shall be changed into or exchanged for stock or other securities of any
other Person (or the Company) or cash or any other property, or (iii)
the Company shall sell or otherwise transfer (or one or more of its
Subsidiaries shall sell or otherwise transfer), in one or more
transactions, assets or earning power aggregating more than 50% of the
assets or earning power of the Company and its Subsidiaries (taken as a
whole) to any other Person other than the Company or one or more of its
wholly-owned Subsidiaries, then, and in each such case, proper
provisions shall be made so that (A) each holder of a Right (except as
otherwise provided therein) shall thereafter have the right to receive,
upon the exercise thereof, at a price equal to the then current Purchase
Price, in accordance with the terms of this Agreement, such number of
validly authorized and issued, fully paid, non-assessable and freely
tradeable shares of Common Stock of the Principal Party (including the
Company as successor thereto or as the surviving corporation),
unencumbered and not subject to any liens, encumbrances, rights of first
refusal or other adverse claims as shall be equal to the result obtained
by (1) multiplying the then current Purchase Price by the number of
shares of Common Stock for which a Right is then exercisable (without
taking into account any adjustment previously made pursuant to Section
11(a)(ii)) and dividing that product by (2) 50% of the current per share
market price of the Common Stock of the Principal Party (determined
pursuant to Section 11(d)) on the date of consummation of such
consolidation, merger, sale or transfer; (B) the Principal Party shall
thereafter be liable for, and shall assume, by virtue of such
consolidation, merger, sale or transfer, all the obligations and duties
of the Company pursuant to this Agreement; (C) the term "Company" shall
thereafter be deemed to refer to such Principal Party, it being
specifically intended that the provisions of Section 11 hereof shall
apply only to such Principal Party following the occurrence of such
consolidation, merger or transfer; and (D) such Principal Party shall
take such steps (including, but not limited to, the reservation of a
sufficient number of shares of its Common Stock in accordance with
Section 9) in connection with such consummation as may be necessary to
assure that the provisions hereof shall thereafter be applicable, as
nearly as reasonably may be practicable, in relation to the shares of
its Common Stock thereafter deliverable upon the exercise of the Rights.
(b) "Principal Party" shall mean
(i) in the case of any transaction described in clause
(i) or (ii) of the first sentence of Section 13(a), the Person
that is the issuer of any securities into which shares of Common
Stock of the Company are converted
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in such merger or consolidation, and if no securities are so
issued, the Person that is the other party to such merger or
consolidation; and
(ii) in the case of any transaction described in clause
(iii) of the first sentence of Section 13(a), the Person that is
the party receiving the greatest portion of the assets or earning
power transferred pursuant to such transaction or transactions;
provided, however, that in any such case, (x) if the Common Stock of
such Person is not at such time and has not been continuously over the
preceding twelve (12) month period registered under Section 12 of the
Exchange Act, and such Person is a direct or indirect Subsidiary of
another Person the Common Stock of which is and has been so registered,
"Principal Party" shall refer to such other Person; and (y) in case such
person is a subsidiary, directly or indirectly, of more than one Person,
the Common Stocks of two or more of which are and have been so
registered "Principal Party" shall refer to whichever of such Persons is
the issuer of the Common Stock having the greatest aggregate market
value.
(c) The Company shall not enter into any transaction of the
kind referred to in this Section 13 if at the time of such transaction
there are any rights, warrants, instruments or securities outstanding or
any Agreement or arrangements which, as a result of the consummation of
such transaction, would substantially diminish or otherwise eliminate
the benefits intended to be afforded by the Rights. The Company shall
not consummate any such consolidation, merger, sale or transfer unless
prior thereto the Company and such Principal Party shall have executed
and delivered to the Rights Agent a supplemental agreement so providing
and further providing that, as soon as practicable after the date of any
consolidation, merger or sale of assets mentioned in paragraph (a) of
this Section 13, the Principal Party will (i) prepare and file a
registration statement under the Securities Act of 1933, as amended,
with respect to the Rights and securities purchasable upon exercise of
the Rights on an appropriate form, and will use its best efforts to
cause such registration statement to (A) become effective as soon as
practicable after such filing and (B) remain effective (with a
prospectus at all times meeting the requirements of the Securities Act
of 1933, as amended) until the Final Expiration Date and to similarly
comply with applicable state securities laws; (ii) use its best efforts
to list (or continue the listing of) the Rights and the securities
purchasable upon exercise of the Rights on a national securities
exchange; and (iii) will deliver to holders of the Rights historical
financial statements for the Principal Party and each of its Affiliates
which comply in all respects with the requirements for registration on
Form 10 (or any successor form) under the Securities Exchange Act of
1934, as amended. The provisions of this Section 13 shall similarly
apply to successive mergers or consolidations or sales or other
transfers.
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Section 14. Fractional Rights and Fractional Shares.
(a) The Company shall not be required to issue fractions of
Rights or to distribute Right Certificates which evidence fractional
Rights. In lieu of such fractional Rights, there shall be paid to the
registered holders of the Right Certificates with regard to which such
fractional Rights would otherwise be issuable, an amount in cash equal
to the same fraction of the current market value of a whole Right. For
the purposes of this Section 14(a) the current market value of a whole
Right shall be the closing price of the Rights for the Trading Day
immediately prior to the date on which such fractional Rights would have
been otherwise issuable. The closing price for any day shall be the
last sale price, regular way, or, in case as reported in the principal
consolidated transaction reporting system with respect to securities
listed or admitted to trading on the New York Stock Exchange or, if the
Rights are not listed or admitted to trading on the New York Stock
Exchange, as reported in the principal consolidated transaction
reporting system with respect to securities listed on the principal
national securities exchange on which the Rights are listed or admitted
to trading or, if the Rights are not listed or admitted to trading on
any national securities exchange, the last quoted price or, if not so
quoted, the average of the high bid and low asked prices in the over-
the-counter market, as reported by NASDAQ or such other system then in
use or, if on any such date the Rights are not quoted by any such
organization, the average of the closing bid and asked prices as
furnished by a professional market maker making a market in the Rights
selected by the Board of Directors of the Company. If on any such date
no such market maker is making a market in the Rights the fair value of
the Rights on such date as determined in good faith by the Board of
Directors of the Company shall be used.
(b) The Company shall not be required to issue fractions of
shares of Common Stock upon exercise of the Rights or to distribute
certificates which evidence fractional shares of Common Stock. In lieu
of fractional shares of Common Stock, the Company shall pay to the
registered holders of Right Certificates at the time such Rights are
exercised as herein provided an amount in cash equal to the same
fraction of the current market value of one share of Common Stock. For
purposes of this Section 14(b), the current market value of a share of
Common Stock shall be the closing price of a share of Common Stock (as
determined pursuant to the second sentence of Section 11(d)) for the
Trading Day immediately prior to the date of such exercise.
(c) The holder of a Right by the acceptance of the Rights
expressly waives his right to receive any fractional Rights or any
fractional shares upon exercise of a Right.
Section 15. Rights of Action. All rights of action in respect of this
Agreement, excepting the rights of actions given to the Rights Agent under
Section 18 hereof, are vested in the respective registered holders of the Right
Certificates (and, prior to the Distribution
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Date, the registered holders of the Common Stock); and any registered holder of
any Right Certificate (or, prior to the Distribution Date, of the Common
Stock), without the consent of the Rights Agent or of the holder of any other
Right Certificate (or, prior to the Distribution Date, of the Common Stock),
may, in his own behalf and for his own benefit, enforce, and may institute and
maintain any suit, action or proceeding against the Company to enforce, or
otherwise act in respect of, his right to exercise the Rights evidenced by such
Right Certificate in the manner provided in such Right Certificate and in this
Agreement. Without limiting the foregoing or any remedies available to the
holders of Rights, it is specifically acknowledged that the holders of Rights
would not have an adequate remedy at law for any breach of this Agreement and
will be entitled to specific performance of the obligations under, and
injunctive relief against actual or threatened violations of, the obligations
of any Person subject to this Agreement.
Section 16. Agreement of Right Holders. Every holder of a Right, by
accepting the same, consents and agrees with the Company and the Rights Agent
and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of the Common Stock;
(b) after the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if
surrendered at the principal office of the Rights Agent accompanied by a
proper instrument of transfer; and
(c) the Company and the Rights Agent may deem and treat the
person in whose name the Right Certificate (or, prior to the
Distribution Date, the associated Common Stock certificate) is recorded
on the books for registration and transfer of the Rights (or, the Common
Stock) as the absolute owner thereof and of the Rights evidenced thereby
(notwithstanding any notations of ownership or writing on the Right
Certificates or the associated Common Stock certificate made by anyone
other than the Company or the Rights Agent) for all purposes whatsoever,
and neither the Company nor the Rights Agent shall be affected by any
notice to the contrary.
Section 17. Right Certificate Holder Not Deemed a Stockholder. No
holder, as such, of any Right Certificate shall be entitled to vote, receive
dividends or be deemed for any purpose the holder of the Common Stock or any
other securities of the Company which may at any time be issuable on the
exercise of the Rights represented thereby, nor shall anything contained herein
or in any Right Certificate be construed to confer upon the holder of any Right
Certificate, as such, any of the rights of a stockholder of the Company or any
right to vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
stockholders (except as provided in Section 25), or to receive dividends or
subscription rights, or otherwise, until the Right or Rights evidenced by such
Right Certificate shall have been exercised in accordance with the provisions
hereof.
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Section 18. Concerning the Rights Agent. The Company agrees to pay to
the Rights Agent reasonable compensation for all services rendered by it
hereunder and, from time to time, on demand of the Rights Agent, its reasonable
expenses and counsel fees and other disbursements incurred in the
administration and execution of this Agreement and the exercise and performance
of its duties hereunder. The Company also agrees to indemnify the Rights
Agent, including its members, stockholders, directors, officers, employees and
agents, for, and to hold it harmless against any loss, liability, or expense,
incurred without gross negligence, bad faith or willful misconduct on the part
of the Rights Agent, for anything done or omitted by the Rights Agent in
connection with the acceptance and administration of this Agreement, including
the costs and expenses of defending against any claim of liability in the
premises.
The Rights Agent shall be protected and shall incur no liability for, or
in respect of any action taken, suffered or omitted by it in connection with,
its administration of this Agreement in reliance upon any Right Certificate or
certificate for the shares of Common Stock or for other securities of the
Company, instrument of assignment or transfer, power of attorney, endorsement,
affidavit, letter, notice, direction, consent, certificate, statement, or other
paper or document believed by it to be genuine and to be signed, executed and,
where necessary, verified, guaranteed or acknowledged, by the proper person or
persons, or otherwise upon the advice of its counsel as set forth in Section 20
hereof.
Section 19. Merger or Consolidation or Change of Name of Rights Agent.
Any corporation into which the Rights Agent or any successor Rights Agent may
be merged or with which it may be consolidated, or any corporation resulting
from any merger or consolidation to which the Rights Agent or any successor
Rights Agent shall be a party, or any corporation succeeding to the corporate
trust business of the Rights Agent or any successor Rights Agent, shall be the
successor to the Rights Agent under this Agreement without the execution or
filing of any paper or any further act on the part of any of the parties
hereto, provided that such corporation would be eligible for appointment as a
successor Rights Agent under the provisions of Section 21. In case at the time
such successor Rights Agent shall succeed to the agency created by this
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 in the name of the successor Rights Agent; and in all such cases
such Right Certificates shall have the full force provided in the Right
Certificates and in this Agreement.
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 on such Right Certificates either in its
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23
prior name or in its changed name; and in all such cases such Right
Certificates shall have the full force provided in the Right Certificates and
in this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent undertakes only
the specific duties and obligations imposed by this Agreement (and no implied
duties or obligations shall be read into this Agreement against the Rights
Agent) upon the following terms and conditions, by all of which the Company and
the holders of Right Certificates by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel (who may
be legal counsel for the Company), and the opinion of such counsel shall
be full and complete authorization and protection to the Rights Agent as
to any action taken or omitted by it in good faith and in accordance
with such opinion.
(b) Whenever in the performance of its duties under this
Agreement the Rights Agent shall deem it necessary or desirable that any
fact or matter be proved or established by the Company prior to taking
or suffering any action hereunder, such fact or matter (unless other
evidence in respect thereof be herein specifically prescribed) may be
deemed to be conclusively proved and established by a certificate signed
by any one of the Chairman of the Board, the President, any Vice
President, 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 Agreement in reliance upon such
certificate.
(c) The Rights Agent shall be liable hereunder to the Company
and any other Person only for its own gross negligence, bad faith or
willful misconduct.
(d) The Rights Agent shall not be liable for or by reason of
any of the statements of fact or recitals contained in this Agreement or
in the Right Certificates (except its countersignature thereof) or be
required to verify the same, but all such statements and recitals are
and shall be deemed to have been made by the Company only.
(e) The Rights Agent shall not be under any responsibility in
respect of the validity of this Agreement or the execution and delivery
hereof (except the due execution hereof by the Rights Agent) or in
respect of the validity or execution of any Right Certificate (except
its countersignature thereof); nor shall it be responsible for any
breach by the Company of any covenant or condition contained in this
Agreement or in any Right Certificate; nor shall it be responsible for
any change in the exercisability of the Rights (including the Rights
becoming void pursuant to Section 11(a)(ii) hereof) or any adjustment in
the terms of the Rights (including the manner, method or amount thereof)
provided for in Section 3, 11, 13, 23 or 24, or the ascertaining of the
existence of facts that would require any such change or adjustment
(except with respect to the exercise of Rights evidenced by Right
-23-
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Certificates after actual notice that such change or adjustment is
required); nor shall it by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation of any
shares of Common Stock to be issued pursuant to this Agreement or any
Right Certificate or as to whether any shares of Common Stock will, when
issued, be validly authorized and issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed, acknowledged
and delivered all such further and other acts, instruments and
assurances as may reasonably be required by the Rights Agent for the
carrying out or performing by the Rights Agent of the provisions of this
Agreement.
(g) The Rights Agent is hereby authorized and directed to
accept instructions with respect to the performance of its duties
hereunder from any one of the Chairman of the Board, the President, any
Vice President, the Secretary or the Treasurer of the Company, and to
apply to such officers for advice or instructions in connection with its
duties, and it shall not be liable for any action taken or suffered to
be taken by it in good faith in accordance with instructions of any such
officer.
(h) The Rights Agent and any stockholder, director, officer or
employee of the Rights Agent may buy, sell or deal in any of the Rights
or other securities of the Company or become pecuniarily interested in
any transaction in which the Company may be interested, or contract with
or lend money to the Company or otherwise act as fully and freely as
though it were not the Rights Agent under this Agreement. Nothing
herein shall preclude the Rights Agent from acting in any other capacity
for the Company or for any other legal entity.
(i) The Rights Agent may execute and exercise any of the
rights or powers hereby vested in it or perform any duty hereunder
either itself or by or through its attorneys or agents, and the Rights
Agent shall not be answerable or accountable for any act, default,
neglect or misconduct of any such attorneys or agents or for any loss to
the Company resulting from any such act, default, neglect or misconduct,
provided reasonable care was exercised in the selection and continued
employment thereof.
(j) If, with respect to any Right Certificate surrendered to
the Rights Agent for exercise or transfer, the certificate attached to
the form of assignment or form of election to purchase, as the case may
be, has either not been completed or indicates an affirmative response
to clause 1 and/or 2 thereof, the Rights Agent shall not take any
further action with respect to such requested exercise or transfer
without first consulting with the Company.
(k) The Rights Agent shall have no responsibility to the
Company, any holders of Rights or any holders of shares of Common
Stock for interest or earnings on any monies held by the Rights Agent
pursuant to this Agreement, except as
-24-
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otherwise specifically agreed in a separate writing by the Company and
the Rights Agent.
(l) The Rights Agent shall not be required to take notice or
be deemed to have notice of any event or condition hereunder, including,
but not limited to, a Distribution Date, a Redemption Date, any
adjustment of the Purchase Price of the Common Stock, the existence of
an Acquiring Person or any other event or condition that may require
action by the Rights Agent, unless the Rights Agent shall be
specifically notified in writing of such event or condition by the
Company, and all notices or other instruments required by this Agreement
to be delivered to the Rights Agent must, in order to be effective, be
received by the Rights Agent as specified in Section 26 hereof, and in
the absence of such notice so delivered, the Rights Agent may
conclusively assume no such event or condition exists.
Section 21. Change of Rights Agent. The Rights Agent or any successor
Rights Agent may resign and be discharged from its duties under this Agreement
upon 30 days' notice in writing mailed to the Company and to each transfer
agent of the shares of Common Stock by registered or certified mail, and to the
holders of the Right Certificates by first-class mail. The Company may remove
the Rights Agent or any successor Rights Agent upon 30 days' notice in writing,
mailed to the Rights Agent or successor Rights Agent, as the case may be, and
to each transfer agent of the shares of Common Stock by registered or certified
mail, and to the holders of the Right Certificates by first-class mail. If the
Rights Agent shall resign or be removed or shall otherwise become incapable of
acting, the Company shall appoint a successor to the Rights Agent. If the
Company shall fail to make such appointment within a period of 30 days after
giving notice of such removal or after it has been notified in writing of such
resignation or incapacity by the resigning or incapacitated Rights Agent or by
the holder of a Right Certificate (who, shall, with such notice, submit his
Right Certificate for inspection by the Company), then the registered holder of
any Right Certificate or the Rights Agent may apply to any court of competent
jurisdiction for the appointment of a new Rights Agent. Any successor Rights
Agent, whether appointed by the Company or by such a court, shall be a
corporation organized and doing business under the laws of the United States or
of the States of Texas, Missouri, Kansas, New York or Delaware (or of any other
state of the United States so long as such corporation is authorized to do
business as a banking institution in any of the States of Texas, Missouri,
Kansas, New York or Delaware), in good standing, having a principal office in
any of the States of Texas, Missouri, Kansas, New York or Delaware, which is
authorized under such laws to exercise 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 million and which is not an Acquiring Person, or an Affiliate or
Associate thereof. After appointment, the predecessor Rights Agent shall be
discharged of any and all duties and obligations arising or accruing after such
appointment, and the successor Rights Agent shall be vested with the same
powers, rights, duties and responsibilities as if it had been originally named
as Rights Agent without further act or deed; but the predecessor Rights Agent
shall deliver and transfer to the successor Rights Agent any property at the
time held by it hereunder and execute and
-25-
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deliver any further assurance, conveyance, act or deed necessary for the
purpose. Not later than the effective date of any such appointment the Company
shall file notice thereof in writing with the predecessor Rights Agent and each
transfer agent of the shares of Common Stock, and mail a notice thereof in
writing to the registered holders of the Right Certificates. Failure to give
any notice provided for in this Section 21, however, or any defect therein,
shall not affect the legality or validity of the resignation or removal of the
Rights Agent or the appointment of the successor Rights Agent, as the case may
be.
Section 22. Issuance of New Right Certificates. Notwithstanding any of
the provisions of this 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 in the Purchase Price per share and the number or kind or class of
shares or other securities or property purchasable under the Right Certificates
made in accordance with the provisions of this Agreement.
Section 23. Redemption.
(a) The Board of Directors of the Company may, at its option,
at any time prior to such time as any person becomes an Acquiring
Person, redeem all but not less than all of the then outstanding Rights
at a redemption price of $.01 per Right, appropriately adjusted to
reflect any stock split, stock dividend or similar transaction occurring
after the date hereof (such redemption price being hereinafter referred
to as the "Redemption Price").
(b) Immediately upon the action of the Board of Directors of
the Company ordering the redemption of the Rights, 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 days after the
action of the Board of 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 Stock. Any notice which is mailed
in the manner herein provided shall be deemed given, whether or not the
holder receives the notice. Each such notice of redemption will state
the method by which the payment of the Redemption Price will be made.
Neither the Company nor any of its Affiliates or Associates may redeem,
acquire or purchase for value any Rights at any time in any manner other
than that specifically set forth in this Section 23 or in Section 24
hereof, and other than in connection with the purchase of shares of
Common Stock prior to the Distribution Date.
Section 24. Exchange.
(a) The Board of Directors of the Company may, at its option, at
any time after any Person becomes an Acquiring Person, exchange all or
part of the then
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outstanding and exercisable Rights (which shall not include Rights that
have become void pursuant to the provisions of Section 11(a)(ii) hereof)
for shares of Common Stock at an exchange ratio of one share of Common
Stock per Right, appropriately adjusted to reflect any stock split,
stock dividend or similar transaction occurring after the date hereof
(such exchange ratio being hereinafter referred to as the "Exchange
Ratio"). Notwithstanding the foregoing, the Board of Directors shall not
be empowered to effect such exchange at any time after any Person (other
than the Company, any Subsidiary of the Company, any employee benefit
Plan of the Company or any such Subsidiary, or any entity holding shares
of Common Stock for or pursuant to the terms of any such plan), together
with all Affiliates and Associates of such Person, becomes the
Beneficial Owner of 50% or more of the voting power of the shares of
Common Stock then outstanding.
(b) Immediately upon the action of the Board of Directors of the
Company ordering the exchange of any Rights pursuant to subsection (a)
of this Section 24 and without any further action and without any
notice, the right to exercise such Rights shall terminate and the only
right thereafter of a holder of such Rights shall be to receive that
number of shares of Common Stock equal to the number of such Rights held
by such holder multiplied by the Exchange Ratio. The Company shall
promptly 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 by first class mail to all of the holders of such
Rights at their last addresses as they appear upon the registry books of
the Rights Agent. Any notice which is mailed in the manner herein
provided shall be deemed given, whether or not the holder receives the
notice. Each such notice of exchange will state the method by which the
exchange of Common Stock for Rights will be effected and, in the event
of any partial exchange, the number of Rights which will be exchanged.
Any partial exchange shall be effected pro rata based on the number of
Rights (other than Rights which have become void pursuant to the
provisions of Section 11(a)(ii) hereof) held by each holder of Rights.
(c) In the event that there shall not be sufficient Common Stock
issued but not outstanding or authorized but unissued to permit any
exchange of Rights as contemplated in accordance with this Section 24,
the Company shall take all such action as may be necessary to authorize
additional shares of Common Stock for issuance upon exchange of the
Rights.
(d) The Company shall not be required to issue fractions of
shares of Common Stock or to distribute certificates which evidence
fractional shares of Common Stock. In lieu of such fractional shares,
the Company shall pay to the registered holders of the Right
Certificates with regard to which such fractional shares would otherwise
be issuable an amount in cash equal to the same fraction of the current
market value of a whole share of Common Stock. For purposes of this
paragraph (d), the current market value of a whole share of Common Stock
shall be the closing price of a share of Common Stock (as determined
pursuant to the second
-27-
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sentence of Section 11(d) hereof) for the Trading Day immediately prior
to the date of exchange pursuant to this Section 24.
Section 25. Notice of Certain Events. In case the Company shall
propose (a) to pay any dividend payable in stock of any class to the holders of
its Common Stock or to make any other distribution to the holders of its Common
Stock (other than a regular quarterly cash dividend) or (b) to offer to the
holders of its Common Stock rights or warrants to subscribe for or to purchase
any additional shares of Common Stock or shares of stock of any class or any
other securities, rights or options, or (c) to effect any reclassification of
its Common Stock (other than a reclassification involving only the subdivision
of outstanding shares of Common Stock), or (d) to effect any consolidation or
merger into or with, or to effect any sale or other transfer (or to permit one
or more of its subsidiaries to effect any sale or other transfer), in one or
more transactions, of more than 50% of the assets or earning power of the
Company and its subsidiaries (taken as a whole) to, any other Person, or (e) to
effect the liquidation, dissolution or winding up of the Company, then, in each
such case, the Company shall give to each holder of a Right Certificate, in
accordance with Section 26 hereof, a notice of such proposed action, which
shall specify the record date for the purposes of such stock dividend, or
distribution of rights or warrants, or the date on which such reclassification,
consolidation, merger, sale, transfer, liquidation, dissolution, or winding up
is to take place and the date of participation therein by the holders of the
Common Stock, if any such date is to be fixed, and such notice shall be so
given in the case of any action covered by clause (a) or (b) above at least 20
days prior to the record date for determining holders of the Common Stock for
purposes of such action, and in the case of any such other action, at least 20
days prior to the date of the taking of such proposed action or the date of
participation therein by the holders of the Common Stock, whichever shall be
the earlier.
In case any of the events set forth in Section 11(a)(ii) of this
Agreement shall occur, then, in any such case, the Company shall as soon as
practicable thereafter give to each holder of a Right Certificate, in
accordance with Section 26 hereof, a notice of the occurrence of such event,
which shall specify the event and the consequences of the event to holders of
Rights under Section 11(a)(ii) hereof.
Section 26. Notices. Notices or demands authorized by this Agreement
to be given or made by the Rights Agent or by the holder of any Right
Certificate to or on the Company shall be sufficiently given or made upon
receipt by the Company if sent by certified or registered mail, return receipt
requested, postage prepaid, addressed (until another address is filed in
writing with the Rights Agent) as follows:
Republic Group Incorporated
X.X. Xxx 0000
Xxxxxxxxxx, Xxxxxx 00000-0000
Attention: Secretary
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Subject to the provisions of Section 21 hereof, any notice of demand authorized
by this Agreement to be given or made by the Company or by the holder of any
Right Certificate to or on the Rights Agent shall be sufficiently given or made
upon receipt by the Rights Agent if sent by certified or registered mail,
return receipt requested, postage prepaid, addressed (until another address is
filed in writing with the Company) as follows:
UMB Bank, N.A., as Rights Agent
X.X. Xxx 000000
Xxxxxx Xxxx, XX 00000-0000
Attention: Securities Transfer Department
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Right Certificate shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed to such holder at the address of such holder as shown on the registry
books for the Right Certificates of the Company.
Section 27. Supplements and Amendments. The Company may from time to
time supplement or amend this Agreement without the approval of any holders of
Right Certificates in order to cure any ambiguity, to correct or supplement any
provision contained herein which may be defective or inconsistent with any
other provisions herein, or to make any other provisions or changes in regard
to matters or questions arising hereunder, which the Company may deem necessary
or desirable, any such supplement or amendment to be evidenced by a writing
signed by the Company and the Rights Agent; provided, however, that from and
after such time as any Person becomes an Acquiring Person, this Agreement shall
not be amended in any manner which would adversely affect the interests of the
holders of Right Certificates. Without limiting the foregoing, the Company may
at any time prior to such time as any Person becomes an Acquiring Person amend
this Agreement to lower the threshold set forth in Section 1(a), to not less
than the greater of (a) a percentage determined by the Board of Directors that
is greater than the largest percentage of the outstanding shares of Common
Stock then known by the Company to be beneficially owned by any Person (other
than the Company, any Subsidiary of the Company, any employee benefit plan of
the Company or any Subsidiary of the Company or any entity holding shares of
Common Stock for or pursuant to the terms of any such Plan or any Exempt Person
(but, in the case of an Exempt Person, only to the extent of any shares of
Common Stock (i) Beneficially Owned by such Exempt Person on the date of this
Agreement or (ii) acquired by such Exempt Person after the date of this
Agreement from any other Exempt Person if such shares have been Beneficially
Owned only by Exempt Persons (except as otherwise contemplated by the last
sentence of Section 1(i) of this Agreement) on and after the date of this
Agreement)) and (b) 10%. Prior to the consent of the Rights Agent to any
supplement or amendment to this Agreement, the Rights Agent may require that an
opinion of counsel stating that such supplement or amendment is authorized or
permitted by the Agreement, complies with its respective terms, will, upon the
execution and delivery thereof, be valid and binding upon the Company in
accordance with its terms.
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Section 28. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Rights Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.
Section 29. Benefits of this Agreement. Nothing in this Agreement
shall be construed to give to any person or corporation other than the Company,
the Rights Agent and the registered holders of the Right Certificates (and,
prior to the Distribution Date, the Common Stock) any legal or equitable right,
remedy or claim under this Agreement; but this Agreement shall be for the sole
and exclusive benefit of the Company, the Rights Agent and the registered
holders of the Right Certificates (and, prior to the Distribution Date, the
Common Stock).
Section 30. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction or
other authority to be invalid, void or unenforceable, the remainder of the
terms, provisions covenants and restrictions of this Agreement shall remain in
full force and effect and shall in no way be affected, impaired or invalidated.
Section 31. Governing Law. This Agreement and each Right Certificate
issued hereunder shall be deemed to be a contract made under the laws of the
State of Delaware and for all purposes shall be governed by and construed in
accordance with the laws of such State applicable to contracts to be made and
performed entirely within such State.
Section 32. Gender. References made herein to any party's gender are
made as a matter of convenience only and shall be construed to refer to either
gender.
Section 33. Counterparts. This Agreement may be executed in any number
of counterparts and each of such counterparts shall for all purposes be deemed
to be an original, and all such counterparts shall together constitute but one
and the same instrument.
Section 34. Descriptive Headings. Descriptive headings of the several
sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
Attest: REPUBLIC GROUP INCORPORATED
By /s/ Xxxxx X. Xxxxxx By /s/ Xxxx Xxxxxxx
------------------------------- ----------------------------------
Assistant Secretary Xxxx Xxxxxxx, Chairman of the
Board and Chief Executive Officer
Attest: UMB BANK, N.A., AS RIGHTS AGENT
By /s/ (Signature Illegible) By /s/ Xxxxx Xxxxxxxx
------------------------------- ----------------------------------
Assistant Secretary Vice President
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Exhibit A
[Form of Right Certificate]
Certificate No. R- Rights
----------
NOT EXERCISABLE AFTER MAY 16, 2006 OR EARLIER IF REDEMPTION OR EXCHANGE
OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $.01 PER RIGHT ON THE
TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER CERTAIN CIRCUMSTANCES.,
RIGHTS BENEFICIALLY OWNED BY ACQUIRING PERSONS (AS DEFINED IN Section
1(a) OF THE RIGHTS AGREEMENT) OR ANY SUBSEQUENT HOLDER OF SUCH RIGHTS
MAY BECOME NULL AND VOID. [THE RIGHTS REPRESENTED BY THIS RIGHT
CERTIFICATE WERE ISSUED TO A PERSON WHO WAS AN ACQUIRING PERSON OR AN
AFFILIATE OR AN ASSOCIATE OF AN ACQUIRING PERSON. THIS RIGHT
CERTIFICATE AND THE RIGHTS REPRESENTED HERE BY MAY BECOME VOID IN THE
CIRCUMSTANCES SPECIFIED IN Section 11(a)(ii) OF THE RIGHTS AGREEMENT.]*
Right Certificate
REPUBLIC GROUP INCORPORATED
This certifies that ______________________________ or registered
assigns, is the registered owner of the number of Rights set forth above, each
of which entitles the owner thereof, subject to the terms, provisions and
conditions of the Rights Agreement dated as of May 1, 1996 (the "Rights
Agreement") between Republic Group Incorporated, a Delaware corporation (the
"Company"), and UMB Bank, N. A., as rights agent (the "Rights Agent"), to
purchase from the Company at any time after the Distribution Date (as such term
is defined in the Rights Agreement) and prior to the earliest of (i) 5:00 p.m.
(Hutchinson, Kansas time) on May 16, 2006, (ii) the date upon which the Rights
are redeemed as provided in Section 23 of the Rights Agreement or (iii) the
time at which such Rights are exchanged as provided for in Section 24 of the
Rights Agreement, at the principal office of the Rights Agent, or at the office
of its successors as Rights Agent, one fully paid, nonassessable share of
Common Stock of the Company, at a purchase price of $45.00 per share of Common
Stock (the "Purchase Price"), upon presentation and surrender of this Right
Certificate with the Form of Election to Purchase duly executed. The number of
Rights evidenced by this Right
---------------
* The portion of the legend in brackets shall be inserted only if
applicable.
-32-
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Certificate (and the number of shares of Common Stock which may be purchased,
upon exercise thereof) set forth above, and the Purchase Price per share set
forth above, are the number and Purchase Price as of May 16, 1996, based on the
Common Stock as constituted at such date.
As provided in the Rights Agreement, the Purchase Price and the number
of shares of Common Stock which may be purchased upon the exercise of the
Rights evidenced by this Right Certificate are subject to modification and
adjustment upon the happening of certain events.
This Right Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Right Certificates. Copies of
the Rights Agreement are on file at the principal executive offices of Republic
Gypsum Company, and the above-mentioned offices of the Rights Agent.
This Right Certificate, with or without other Right Certificates, upon
surrender at the principal office of the Rights Agent, may be exchanged for
another Right Certificate or Right Certificates of like tenor evidencing Rights
entitling the holder to purchase a like aggregate number of shares of Common
Stock as the Rights evidenced by the Right Certificate or Right Certificates
surrendered shall have entitled such holder to purchase. If this Right
Certificate shall be exercised in part, the holder shall be entitled to receive
upon surrender hereof another Right Certificate or Right Certificates for the
number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced
by this Certificate may, but are not required to, be (i) redeemed by the
Company at a redemption price of $.01 per Right or (ii) exchanged in whole or
in part for shares of Common Stock.
No fractional shares of Common Stock will be issued upon the exercise of
any Right or Rights evidenced hereby but in lieu thereof a cash payment will be
made, as provided in the Rights Agreement.
No holder of this Right Certificate shall be entitled to vote or receive
dividends or be deemed for any purpose the holder of shares of Common Stock or
of any other securities of the Company which may at any time be issuable on the
exercise hereof, nor shall anything contained in the Rights Agreement or herein
be construed to confer upon the holder hereof, as such, any of the rights of a
stockholder of the Company or any right to vote for the election of directors
or upon any matter submitted to stockholders at any meeting thereof, or to give
or withhold consent to any corporate action, or, to receive notice of meetings
or other actions affecting stockholders (except as provided in the Rights
Agreement), or to receive dividends or subscription rights, or otherwise, until
the Right or Rights evidenced by this Right Certificate shall have been
exercised as provided in the Rights Agreement.
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This Right Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Rights Agent.
-34-
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WITNESS the facsimile signature of the proper officers of the Company
and its corporate seal. Dated as of ______________________________, 19_____.
REPUBLIC GROUP INCORPORATED
Attest:
By By
------------------------------- ----------------------------------
Title: Secretary Xxxx Xxxxxxx, Chairman
of the Board and Chief
Executive Officer
Countersigned:
UMB BANK, N.A., AS RIGHTS AGENT
By
-------------------------------
Authorized Signature
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[Form of Reverse Side of Right Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Right Certificate.)
FOR VALUE RECEIVED hereby sells, assigns
------------------------------
and transfers unto
-------------------------------------------------------------
--------------------------------------------------------------------------------
(Please print name and address of transferee)
--------------------------------------------------------------------------------
this Right Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint
-----------------------------
Attorney, to transfer the within Right Certificate on the books of the within-
named Company, with full power of substitution.
Dated: , 19 .
------------------------------------ -----
------------------------------
*Signature
**Signature Guaranteed:
----------------------------
----------------------------
+ Certificate
The undersigned hereby certifies by checking the appropriate boxes that:
(1) this Right Certificate _____ is _____ is not being sold, assigned
and transferred by or on behalf of a Person who is or was an Acquiring Person
or an Affiliate or Associate of any such Acquiring Person (as such terms are
defined pursuant to the Rights Agreement);
(2) after due inquiry and to the best knowledge of the undersigned,
it _____ did _____ did not acquire the Rights evidenced by this Right
Certificate from any Person who is, was or subsequently became an Acquiring
Person or an Affiliate or Associate of an Acquiring Person.
Dated: , 19 .
------------------------------------ -----
------------------------------
*Signature
**Signature Guaranteed:
----------------------------
----------------------------
37
[Form of Reverse Side of Right Certificate -- continued]
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to
exercise the Right Certificate.)
To: REPUBLIC GROUP INCORPORATED
The undersigned hereby irrevocably elects to exercise __________________
Rights represented by this Right Certificate to purchase the shares of Common
Stock issuable upon the exercise of such Rights and requests that certificates
for such shares of Common Stock be issued in the name of:
Please insert social security
or other identifying number
--------------------------------------------------------------------------------
(Please print name and address)
--------------------------------------------------------------------------------
Dated: , 19 .
------------------------------------ -----
------------------------------
*Signature
**Signature Guaranteed:
----------------------------
----------------------------
+ Certificate
The undersigned hereby certifies by checking the appropriate boxes,
that:
(1) the Rights evidenced by this Right Certificate _____ are _____
are not being exercised by or, on behalf of a Person who is or was an Acquiring
Person or an Affiliate or Associate of any such Acquiring Person (as such terms
are defined pursuant to the Rights Agreement);
(2) after due inquiry and to the best knowledge of the undersigned,
it _____ did _____ did not acquire the Rights evidenced by this Right
Certificate from any Person who is, was or became an Acquiring Person or an
Affiliate or Associate of an Acquiring Person.
Dated: , 19 .
------------------------------------ -----
------------------------------
*Signature
**Signature Guaranteed:
----------------------------
----------------------------
38
[Form of Reverse Side of Right Certificate -- continued]
NOTICES
* The signatures in the foregoing Forms of Assignment and Election
must correspond to the name as written upon the face of this Right Certificate
in every particular, without alteration or enlargement or any change
whatsoever.
** Signatures must be guaranteed by an Eligible Guarantor
Institution as defined by SEC Rule 17Ad-15 (12CFR 240.17 Ad-15) or any similar
rule which the Rights Agent deems applicable.
+ In the event the certification set forth above in the Forms of
Assignment and Election is not completed, neither the Rights Agent nor the
Company will be obligated to effect any assignment or election to purchase and
may deem the beneficial owner of the Rights evidenced by this Right Certificate
to be an Acquiring Person or an Affiliate or Associate thereof (as defined in
the Rights Agreement) and, in the case of any Assignment, may affix a legend to
that effect on any Right Certificates issued in exchange for this Rights
Certificate.
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Exhibit B
SUMMARY OF RIGHTS TO PURCHASE
COMMON STOCK
On April 30, 1996, the Board of Directors of Republic Group Incorporated
(the "Company") declared a dividend distribution of one common stock purchase
right (a "Right") for each outstanding share of common stock, $1.00 par value
(the "Common Stock"), of the Company. The distribution is payable on May 16,
1996 to the stockholders of record at the close of business on that date. Each
Right entitles the registered holder to purchase from the Company one share of
Common Stock at a price of $45.00 per share of Common Stock (the "Purchase
Price"), subject to adjustment. The description and terms of the Rights are
set forth in a Rights Agreement (the "Rights Agreement") between the Company
and UMB Bank, N.A., as Rights Agent (the "Rights Agent").
Until the earlier to occur of (i) 10 days following a public
announcement that a person or group of affiliated or associated persons (other
than the Company, any wholly-owned subsidiary of the Company, any employee
benefit plan of the Company or any such subsidiary, any entity holding shares
of Common Stock for or pursuant to the terms of any such plan or any Exempt
person (as described below) but, in the case of an Exempt Person, only to the
extent of any shares of Common Stock (x) beneficially owned by such Exempt
Person on the date of the Rights Agreement or (y) acquired by such Exempt
Person after the date of the Rights Agreement from any other Exempt Person if
such shares have been beneficially owned only by Exempt Persons on and after
the date of the Rights Agreement) (an "Acquiring Person") have acquired
beneficial ownership of 15% or more of the outstanding Common Stock, or (ii) 10
business days (or such later date as may be determined by action of the Board
of Directors prior to such time as any Person becomes an Acquiring Person)
following the commencement or announcement of an intention to make a tender or
exchange offer the consummation of which would result in any person becoming an
Acquiring Person (the earlier of such dates being called the "Distribution
Date"), the Rights will be evidenced, with respect to any of the Common Stock
certificates outstanding as of May 16, 1996, by such Common Stock certificates
with a copy of this Summary of Rights attached thereto. (An Exempt Person
includes any of Phil or Xxxxxxxx Xxxxxxx, their descendants and their
descendants' spouses, trusts or estates for any of their benefits,
partnerships, corporations or other entities 80%-owned by any of them.)
The Rights Agreement provides that, until the Distribution Date, the
Rights will be transferred with and only with the Common Stock. Until the
Distribution Date (or earlier redemption or expiration of the Rights), new
Common Stock certificates issued after May 16, 1996 upon transfer or new
issuance of shares of Common Stock will contain a notation incorporating the
Rights Agreement by reference. Until the Distribution Date (or earlier
redemption or expiration of the Rights), the surrender for transfer of any
certificates for Common Stock, outstanding as of May 16, 1996, even without
such notation or a copy of this Summary of Rights being attached thereto, will
also constitute the transfer of the Rights
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associated with the Common Stock represented by such certificate. As soon as
practicable following the Distribution Date, separate certificates evidencing
the Rights ("Right Certificates") will be mailed to holders of Record of shares
of Common Stock as of the close of business on the Distribution Date and such
separate Right Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date. The Rights
will expire on May 16, 2006, unless the Final Expiration Date is extended or
unless the Rights are earlier redeemed or exchanged by the Company as described
below.
The Rights are protected by customary antidilution provisions. The
Purchase Price payable, and the number of shares of Common Stock or other
securities or property issuable, upon exercise of the Rights are subject to
adjustment from time to time to prevent dilution (i) in the event of a stock
dividend on, or a subdivision, combination or reclassification of the Common
Stock, (ii) upon the grant to holders of the shares of Common Stock of certain
rights or warrants to subscribe for shares of Common Stock or convertible
securities at less than the current market price of the Common Stock or (iii)
upon the distribution to holders of shares of Common Stock of evidences of
indebtedness or assets (excluding regular periodic cash dividends thereafter
and, if there is an Acquiring Person, not exceeding 125% of the prior regular
periodic cash dividend, or dividends payable in shares of Common Stock) or of
subscription rights or warrants (other than those referred to above).
Subject to certain exchange rights that may be exercised by the Board of
Directors, in the event that any person or group of affiliated or associated
persons becomes an Acquiring Person, each holder of a Right (other than Rights
held by the Acquiring Person (which will thereafter be void)) shall thereafter
have the right (automatically upon exercise thereof) to receive that number of
shares of Common Stock having a market value of two times the Purchase Price.
In the event that the Company were acquired in a merger or other business
combination transaction or more than 50% of its consolidated assets or earning
power were sold after a person or group has become an Acquiring Person, proper
provision will be made so that each holder of a Right will thereafter have the
right to receive, upon the exercise thereof at the then current exercise price
of the Right, that number of shares of common stock of the Acquiring Person
which at the time of such transaction would have a market value of two times
the exercise price of the Right.
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in
such Purchase Price. No fractional shares of Common Stock will be issued and
in lieu thereof a payment in cash will be made based on the market price of the
Common Stock on the last trading date prior to the date of exercise.
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41
At any time prior to such time as any person or group becomes an
Acquiring Person, the Board of Directors of the Company may redeem the Rights
in whole, but, not in part, at a price of $.01 per Right (the "Redemption
Price"). Immediately upon the action of the Board of Directors ordering
redemption of the Rights, the right to exercise the Rights will terminate and
the only right of the holders of Rights will be to receive the Redemption
Price.
At any time after any person or group becomes an Acquiring Person, the
Board of Directors may exchange all or part of the outstanding and exercisable
Rights (other than Rights owned by such person or group which have become void)
for Common Stock at an exchange ratio of one share of Common Stock per Right,
as may be adjusted from time to time to reflect any stock split, stock dividend
or similar transaction (the "Exchange Right"). Notwithstanding the above, the
Board of Directors may not exercise the Exchange Right after any person,
together with any associate or affiliate of such person, has become the
beneficial owner of 50% or more of the voting power of the shares of Common
Stock. Immediately upon the action of the Board of Directors ordering the
exchange of the Rights, the right to exercise the Rights will terminate and the
only right of the holders of Rights will be to receive that number of shares of
Common Stock equal to the number of Rights held by such holders multiplied by
the exchange ratio.
The terms of the Rights may be amended by the Company without the
consent of the holders of the Rights, including an amendment to lower the
threshold described above to not less than the greater of (i) a percentage
determined by the Board of Directors that is greater than the largest
percentage of the outstanding Common Shares then known to the Company to be
beneficially owned by any person or group (other than excepted persons
discussed above) and (ii) 10%, except that from and after such time as any
person or group becomes an Acquiring Person no such amendment may adversely
affect the interests of the holders of the Rights.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Company, including, without limitation, the
right to vote or to receive dividends.
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to a Registration Statement on Form 8-A dated
May 1, 1996. A copy of the Rights Agreement is available free of charge from
the Rights Agent. This summary description of the Rights does not purport to
be complete and is qualified in its entirety by reference to the Rights
Agreement, which is hereby incorporated herein by reference.
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42
Exhibit C
CERTIFICATE OF DESIGNATIONS, PREFERENCES AND RIGHTS
OF SERIES C PREFERRED STOCK
OF
REPUBLIC GROUP INCORPORATED
PURSUANT TO SECTION 151 OF THE GENERAL CORPORATION LAW
OF THE STATE OF DELAWARE
It is hereby certified that:
1. The name of the corporation is Republic Group Incorporated (the
"Corporation").
2. That pursuant to the authority conferred upon the Corporation's
Board of Directors by the Restated Certificate of Incorporation of the Company,
the Board of Directors adopted the following resolution on September 12, 1996:
RESOLVED, that pursuant to the authority granted to and vested in the
Board of Directors of this Corporation (hereinafter called the "Board of
Directors" or the "Board") in accordance with the provisions of the
Corporation's Restated Certificate of Incorporation (the "Certificate of
Incorporation"), the Board of Directors' hereby creates a series of Preferred
Stock of the Corporation and hereby states the designation and number of
shares, and fixes the relative rights and preferences thereof (in addition to
the provisions set forth in the Restated Certificate of Incorporation which are
applicable to the Preferred Stock of all classes and series) as follows:
Section 1. Designation and Amount. The shares of such series shall be
designated as "Series C Junior Participating Preferred Stock" (the "Series C
Preferred Stock") and the number of shares constituting such series shall be
forty-seven thousand two hundred and fifty (47,250). Such number of shares may
be increased or decreased by resolution of the Board of Directors, provided,
that no decrease shall reduce the number of shares of Series C Preferred Stock
to a number less than that of the shares then outstanding plus the number of
shares reserved for issuance upon the exercise of outstanding options, rights
or warrants or upon the conversion of any outstanding securities issued by the
Corporation convertible into Series C Preferred Stock.
Section 2. Dividends and Distributions.
(A) Subject to the prior and superior rights of the holders of any
shares of any series of Preferred Stock ranking prior and superior to the
shares of Series C Preferred Stock with respect to dividends, the holders of
shares of Series C Preferred Stock, in
43
preference to the holders of the Corporation's Common Stock, $1.00 par value
per share ("Common Stock"), and of any other junior stock, shall be entitled to
receive, when, as and if declared by the Board of Directors out of funds
legally available for the purpose, quarterly dividends payable in cash on the
first day of March, June, September and December in each year (each such date
being referred to herein as a "Quarterly Dividend Payment Date"), commencing on
the first Quarterly Dividend Payment Date after the first issuance of a share
or fraction of a share of Series C Preferred Stock, in an amount per share
(rounded to the nearest cent) equal to the greater of (a) $1 or (b) subject to
the provision for adjustment hereinafter set forth, 2,000 times the aggregate
per share amount of all cash dividends, and 2,000 times the aggregate per share
amount (payable in kind) of all non-cash dividends or other distributions,
other than a dividend payable in shares of Common Stock or a subdivision of the
outstanding shares of Common Stock (by reclassification or otherwise), declared
on the Common Stock since the immediately preceding Quarterly Dividend Payment
Date or, with respect to the first Quarterly Dividend Payment Date, since the
first issuance of any share or fraction of a share of Series C Preferred Stock.
In the event the Corporation shall at any time declare or pay any dividend on
the Common Stock payable in shares of Common Stock, or effect a subdivision or
combination or consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in shares of Common
Stock) into a greater or lesser number of shares of Common Stock, then in each
such case the amount to which holders of shares of Series C Preferred Stock
were entitled immediately prior to such event under clause (b) of the preceding
sentence shall be adjusted by multiplying such amount by a fraction, the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution on the
Series C Preferred Stock as provided in paragraph (A) of this Section
immediately after it declares a dividend or distribution on the Common Stock
(other than a dividend payable in shares of Common Stock), provided that, in
the event no dividend or distribution shall have been declared on the Common
Stock during the period between any Quarterly Dividend Payment Date and the
next subsequent Quarterly Dividend Payment Date, a dividend of $1 per share on
the Series C Preferred Stock shall nevertheless be payable on such subsequent
Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative on outstanding
shares of Series C Preferred Stock from the Quarterly Dividend Payment Date
next preceding the date of issue of such shares, unless the date of issue of
such shares is a Quarterly Dividend Payment Date or is a date after the record
date for the determination of holders of shares of Series C Preferred Stock
entitled to receive a quarterly dividend and before such Quarterly Dividend
Payment Date, in either of which events such dividends shall begin to
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accrue and be cumulative from such Quarterly Dividend Payment Date. Accrued
but unpaid dividends shall not bear interest. Dividends paid on the shares of
Series C Preferred Stock in an amount less than the total amount of such
dividends at the time accrued and payable on such shares shall be allocated pro
rata on a share-by-share basis among all such shares at the time outstanding.
The Board of Directors may fix a record date for the determination of holders
of shares of Series C Preferred Stock entitled to receive payment of a dividend
or distribution declared thereon, which record date shall be not more than 60
days prior to the date fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of Series C Preferred
Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set forth,
each share of Series C Preferred Stock shall entitle the holder thereof to
2,000 votes on all matters submitted to a vote of the stockholders of the
Corporation. In the event the Corporation shall at any time declare or pay any
dividend on Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise than by payment of a dividend in shares
of Common Stock) into a greater or lesser number of shares of Common Stock,
then in each such case the number of votes per share to which holders of shares
of Series C Preferred Stock were entitled immediately prior to such event shall
be adjusted by multiplying such number by a fraction the numerator of which is
the number of shares of Common Stock outstanding immediately after such event
and the denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(B) Except as otherwise provided herein, in any other Certificate of
Designations, Preferences and Rights creating a series of Preferred Stock, or
by law, the holders of shares of Series C Preferred Stock and the holders of
shares of Common Stock and any other capital stock of the Corporation having
general voting rights shall vote together as one class on all matters submitted
to a vote of stockholders of the Corporation.
(C) Except as set forth herein, holders of Series C Preferred Stock
shall have no special voting rights and their consent shall not be required
(except to the extent they are entitled to vote with holders of Common Stock as
set forth herein) for taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or distributions
payable on the Series C Preferred Stock as provided in Section 2 are in
arrears, thereafter and until all
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accrued and unpaid dividends and distributions, whether or not declared, on
shares of Series C Preferred Stock outstanding shall have been paid in full,
the Corporation shall not:
(i) declare or pay dividends on, make any other distributions
on, any shares of stock ranking junior (either as to dividends or
upon liquidation, dissolution or winding up) to the Series C
Preferred Stock;
(ii) declare or pay dividends on or make any other
distributions on any shares of stock ranking on a parity (either
as to dividends or upon liquidation, dissolution or winding up)
with the Series C Preferred Stock, except dividends paid ratably
on the Series C Preferred Stock and all such parity stock on
which dividends are payable or in arrears in proportion to the
total amounts to which the holders of all such shares are then
entitled;
(iii) redeem or purchase or otherwise acquire for consideration
shares of any stock ranking junior (either as to dividends or
upon liquidation, dissolution or winding up) to the Series C
Preferred Stock, provided that the Corporation may at any time
redeem, purchase or otherwise acquire shares of any such junior
stock in exchange for shares of any stock of the Corporation
ranking junior (either as to dividends or upon dissolution,
liquidation or winding up) to the Series C Preferred Stock; or
(iv) redeem or purchase or otherwise acquire for consideration
any shares of Series C Preferred Stock, or any shares of stock
ranking on a parity with the Series C Preferred Stock, except in
accordance with a purchase offer made in writing or by
publication (as determined by the Board of Directors) to all
holders of such shares upon such terms as the Board of Directors,
after consideration of the respective annual dividend rates and
other relative rights and preferences of the respective series
and classes, shall determine in good faith will result in fair
and equitable treatment among the respective series or classes.
(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any shares of
stock of the Corporation unless the Corporation could, under paragraph (A) of
this Section 4, purchase or otherwise acquire such shares at such time and in
such manner.
Section 5. Reacquired Shares. Any shares of Series C Preferred Stock
purchased or otherwise acquired by the Corporation in any manner whatsoever
shall be retired and cancelled promptly after the acquisition thereof. All
such shares shall upon their cancellation become authorized but unissued shares
of Preferred Stock and may be reissued
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46
as part of a new series of Preferred Stock subject to the conditions and
restrictions on issuance set forth herein, in the Certificate of Incorporation,
or in any other Certificate of Designations, Preferences and Rights creating a
series of Preferred Stock or any similar stock or as otherwise required by law.
Section 6. Liquidation, Dissolution or Winding Up. Upon any
liquidation, dissolution or winding up of the Corporation, no distribution
shall be made (1) to the holders of shares of stock ranking junior (either as
to dividends or upon liquidation, dissolution or winding up) to the Series C
Preferred Stock unless, prior thereto, the holders of shares of Series C
Preferred Stock shall have received an amount equal to the greater of (x)
$2,000 per share, plus any accrued and unpaid dividends and distributions
whether or not declared, to the date of such payment or (y) an amount per
share, subject to the provision for adjustment hereinafter set forth, equal to
2,000 times the aggregate amount to be distributed per share to holders of
Common Stock or, (2) to the holders of stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the Series C
Preferred Stock, except distributions made ratably on the Series C Preferred
Stock and all other such parity stock in proportion to the total amounts to
which the holders of all such shares are entitled upon such liquidation,
dissolution or winding up. In the event the Corporation shall at any time
declare or pay any dividend on Common Stock payable in shares of Common Stock,
or effect a subdivision or combination or consolidation of the outstanding
shares of Common Stock (by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or lesser number of shares
of Common Stock, then in each such case the aggregate amount to which holders
of shares of Series C Preferred Stock were entitled immediately prior to such
event under clause (1) of the preceding sentence shall be adjusted by
multiplying such amount by a fraction the numerator of which is the number of
shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the Corporation shall
enter into any consolidation, merger, combination or other transaction in which
the shares of Common Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case the shares of
Series C Preferred Stock shall at the same time be similarly exchanged or
changed in an amount per share (subject to the provision for adjustment
hereinafter set forth) equal to 2,000 times the aggregate amount of stock,
securities, cash and/or any other property (payable in kind), as the case may
be, into which or for which each shares of Common Stock is changed or
exchanged. In the event the Corporation shall at any time declare or pay any
dividend on Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise than by payment of a dividend in shares
of Common Stock) into a greater or lesser number of shares of
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Common Stock, then in each such case the amount set forth in the preceding
sentence with respect to the exchange or change of shares of Series C Preferred
Stock shall be adjusted by multiplying such amount by a fraction the numerator
of which is the number of shares of Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of Common Stock
that were outstanding immediately prior to such event.
Section 8. No Redemption. The shares of Series C Preferred Stock shall
not be redeemable.
Section 9. Rank. The Series C Preferred Stock shall rank, with respect
to the payment of dividends and the distribution of assets, junior to all other
series of the Preferred Stock unless the terms of any such series shall provide
otherwise.
Section 10. Amendment. The Certificate of Incorporation shall not be
amended in any manner which would materially alter or change the powers,
preferences or special rights of the Series C Preferred Stock so as to affect
them adversely without the affirmative vote of the holders of at least two-
thirds of the outstanding shares of Series C Preferred Stock, voting together
as a single series.
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IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designations, Preferences and Rights of Series C Preferred Stock to be duly
executed by the Corporation's authorized officer as shown below and attested to
by its Secretary as of the ____ day of ______________, _____.
REPUBLIC GROUP INCORPORATED
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
ATTEST:
-----------------------------------
Name:
------------------------------
Title: Secretary
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