SHAREHOLDERS RIGHTS AGREEMENT
Exhibit
4.1
This
Shareholders Rights Agreement (this “Rights
Agreement”)
is
made and entered into as of April 11, 2007, by and between Genco Shipping &
Trading Limited, a Xxxxxxxx Islands corporation (the “Company”),
and
Mellon Investor Services LLC, a New Jersey limited liability company, as Rights
Agent (the “Rights
Agent”).
WHEREAS,
the Board of Directors of the Company (the “Board”)
has
(a) authorized and declared a dividend of one right (the “Right”)
for
each share of the Company’s common stock, par value $.01 per share (the “Common
Stock”) held of record as of the Close of Business (as hereinafter defined) on
April 11, 2007 (the “Record
Date”)
and
(b) has further authorized the issuance of one Right in respect of each share
of
Common Stock that shall become outstanding (i) at any time between the Record
Date and the earliest of the Distribution Date, the Redemption Date or the
Final
Expiration Date (as such terms are hereinafter defined) or (ii) upon the
exercise or conversion, prior to the earlier of the Redemption Date or the
Final
Expiration Date, of any option or other security exercisable for or convertible
into shares of Common Stock, which option or other such security is outstanding
on the Distribution Date; and
WHEREAS,
each Right represents the right of the holder thereof to purchase one
one-thousandth of a share of Series A Preferred Stock (as such number may
hereafter be adjusted pursuant to the provisions hereof), upon the terms and
subject to the conditions set forth herein, having the rights, preferences
and
privileges set forth in the Certificate of Designations of Series A Preferred
Stock, attached hereto as Exhibit
A.
NOW
THEREFORE, in consideration of the premises and the mutual agreements set forth
herein, the parties hereby agrees as follows:
1. Certain
Definitions.
“Acquiring
Person”
shall
mean any Person, other than Oaktree Capital Management, LLC and its related
entities, Xxxxx X. Xxxxxxxxxxxxx, or any Person who acquires Common Stock
through a Permitted Offer, who or which, together with all Affiliates and
Associates of such Person, shall be the Beneficial Owner of 15% or more of
the
shares of Common Stock then outstanding, but shall not include the Company,
any
Subsidiary of the Company or any employee benefit plan of the Company or of
any
Subsidiary of the Company, or any Person holding shares of Common Stock for
or
pursuant to the terms of any such plan. Notwithstanding the foregoing, no Person
shall be deemed to be 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 a
Person who (i) becomes the Beneficial Owner of 15% or more of the shares of
Common Stock of the Company then outstanding by reason of share purchases by
the
Company and (ii) then after such share purchases by the Company, becomes the
Beneficial Owner of any additional shares of Common Stock of the Company (other
than pursuant to a dividend or distribution paid or made by the Company on
the
outstanding shares of Common Stock in shares of Common Stock or pursuant to
a
split or subdivision of the
outstanding
shares of Common Stock), such Person shall be deemed to be an Acquiring Person
unless upon becoming the Beneficial Owner of such additional shares of Common
Stock of the Company such Person does not beneficially own 15% or more of the
shares of Common Stock of the Company then outstanding. Notwithstanding the
foregoing, (i) if the Company’s Board of Directors determines in good faith that
a Person who would otherwise be an “Acquiring Person,” as defined herein, has
become such inadvertently (including, without limitation, because (A) such
Person was unaware that it beneficially owned a percentage of the shares of
Common Stock that would otherwise cause such Person to be an “Acquiring Person,”
as defined herein, or (B) such Person was aware of the extent of the shares
of
Common Stock it beneficially owned but had no actual knowledge of the
consequences of such beneficial ownership under this Agreement) and without
any
intention of changing or influencing control of the Company, and if such Person
divested or 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 herein, then such Person shall not be deemed to be or to have become
an
“Acquiring Person” for any purposes of this Agreement; and (ii) if, as of the
date hereof, any Person is the Beneficial Owner of 15% or more of the shares
of
Common Stock outstanding, such Person shall not be or become an “Acquiring
Person,” as defined herein, unless and until such time as such Person shall
become the Beneficial Owner of additional shares of Common Stock (other than
pursuant to a dividend or distribution paid or made by the Company on the
outstanding shares of Common Stock in shares of Common Stock or pursuant to
a
split or subdivision of the outstanding shares of Common Stock), unless, upon
becoming the Beneficial Owner of such additional shares of Common Stock, such
Person is not then the Beneficial Owner of 15% or more of the shares of Common
Stock then outstanding.
“Adjustment
fraction”
shall
have the meaning set forth in Section 11(a)(i) hereof.
“Affiliate”
and
“Associate”
shall
have the respective meanings ascribed to such terms in Rule 12b-2 of the General
Rules and Regulations under the Exchange Act, as in effect on the date of this
Agreement.
A
Person
shall be deemed the “Beneficial
Owner”
of
and
shall be deemed to “Beneficially
Own”
any
securities:
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(i)
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which
such Person or any of such Person’s Affiliates or Associates beneficially
owns, directly or indirectly, for purposes of Section 13(d) of the
Exchange Act and Rule 13d-3 thereunder (or any comparable or successor
law
or regulation);
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(ii)
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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 (other than customary agreements with and between
underwriters and selling group members with respect to a bona fide
public
offering of securities), or upon the exercise of conversion rights,
exchange rights, rights (other than the Rights), warrants or options,
or
otherwise; provided,
however,
that a Person shall not be deemed pursuant to this subsection (ii)(A)
to
be the Beneficial Owner of, or to
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beneficially
own, (1) 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 (2)
securities which a Person or any of such Person’s Affiliates or Associates may
be deemed to have the right to acquire pursuant to any merger or other
acquisition agreement between the Company and such Person (or one or more of
its
Affiliates or Associates) if such agreement has been approved by the Board
of
Directors of the Company prior to there being an Acquiring Person; 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 under this subsection (ii)(B) 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
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(iii)
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which
are beneficially owned, directly or indirectly, by any other Person
(or
any Affiliate or Associate thereof) with which such Person or any
of such
Person’s Affiliates or Associates has any agreement, arrangement or
understanding, whether or not in writing (other than customary agreements
with and between underwriters and selling group members with respect
to a
bona fide public offering of securities) for the purpose of acquiring,
holding, voting (except to the extent contemplated by the proviso
to
subsection (ii)(B) above) or disposing of any securities of the Company;
provided,
however,
that in no case shall an officer or director of the Company be deemed
(x)
the Beneficial Owner of any securities beneficially owned by another
officer or director of the Company solely by reason of actions undertaken
by such persons in their capacity as officers or directors of the
Company
or (y) the Beneficial Owner of securities held of record by the trustee
of
any employee benefit plan of the Company or any Subsidiary of the
Company
for the benefit of any employee of the Company or any Subsidiary
of the
Company, other than the officer or director, by reason of any influence
that such officer or director may have over the voting of the securities
held in the plan.
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“Business
Day”
shall
mean any day other than a Saturday, Sunday or a day on which banking
institutions in New York are authorized or obligated by law or executive order
to close.
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“Close
of Business”
on
any
given date shall mean 5:00 P.M., New York time, on such date; provided,
however,
that if
such date is not a Business Day it shall mean 5:00 P.M., New York time, on
the
next succeeding Business Day.
“Common
Stock”
shall
have the meaning set forth in the preamble. Common 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 control such first-mentioned Person.
“Common
Stock Equivalents”
shall
have the meaning set forth in Section 11(a)(iii) hereof.
“Company”
shall
have the meaning set forth in the preamble, subject to the terms of Section
13(a)(iii)(C) hereof.
“Current
Per Share Market Price”
of
any
security (a “Security” for purposes of this definition), for all computations
other than those made pursuant to Section 11(a)(iii) hereof, shall mean the
average of the daily closing prices per share of such Security for the thirty
(30) consecutive Trading Days immediately prior to such date, and for purposes
of computations made pursuant to Section 11(a)(iii) hereof, the Current Per
Share Market Price of any Security on any date shall be deemed to be the average
of the daily closing prices per share of such Security for the ten (10)
consecutive Trading Days immediately prior to such date; provided,
however,
that in
the event that the Current Per Share Market Price of the Security is determined
during a period following the announcement by the issuer of such Security of
(i)
a dividend or distribution on such Security payable in shares of such Security
or securities convertible into such shares or (ii) any subdivision, combination
or reclassification of such Security, and prior to the expiration of the
applicable thirty (30) Trading Day or ten (10) Trading Day period, after the
ex-dividend date for such dividend or distribution, or the record date for
such
subdivision, combination or reclassification, then, and in each such case,
the
Current Per Share Market Price shall be appropriately adjusted to reflect the
current market price per share equivalent of such Security. 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 Security is 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 Security is listed
or
admitted to trading or, if the Security is not listed or admitted to trading
on
any national securities exchange, the last sale price or, if such last sale
price is not reported, 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 Security is not quoted by any such organization,
the
average of the closing bid and asked prices as furnished by a professional
market maker making a market in the Security selected by the Board of Directors
of the Company. If on any such date no market maker is making a market in the
Security, the fair value of such shares on such date as determined in good
faith
by the Board of Directors of the Company shall be used. If the Preferred Shares
are not publicly traded, the Current Per Share Market Price of the Preferred
Shares shall be conclusively
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deemed
to
be the Current Per Share Market Price of the shares of Common Stock as
determined pursuant to this definition, as appropriately adjusted to reflect
any
stock split, stock dividend or similar transaction occurring after the date
hereof, multiplied by 1000. If the Security is not publicly held or so listed
or
traded, Current Per Share Market Price shall mean the fair value per share
as
determined in good faith by the Board of Directors of the Company, whose
determination shall be described in a statement filed with the Rights Agent
and
shall be conclusive for all purposes.
“Current
Value”
shall
have the meaning set forth in Section 11(a)(iii) hereof.
“Distribution
Date”
shall
mean the earlier of (i) the Close of Business on the tenth day after the Shares
Acquisition Date (or, if the tenth day after the Shares Acquisition Date occurs
before the Record Date, the Close of Business on the Record Date) or (ii) the
Close of Business on the tenth Business Day (or such later date as may be
determined by action of the Company’s Board of Directors) after the date that a
tender or exchange offer by any Person (other than the Company, any Subsidiary
of the Company, any employee benefit plan of the Company or of any Subsidiary
of
the Company, or any Person or entity organized, appointed or established by
the
Company for or pursuant to the terms of any such plan) is first published or
sent or given within the meaning of Rule 14d-2(a) of the General Rules and
Regulations under the Exchange Act, if, assuming the successful consummation
thereof, such Person would be an Acquiring Person.
“Equivalent
Shares”
shall
mean Preferred Shares and any other class or series of capital stock of the
Company which is entitled to the same rights, privileges and preferences as
the
Preferred Shares.
“Exchange
Act”
shall
mean the Securities Exchange Act of 1934, as amended.
“Exchange
Ratio”
shall
have the meaning set forth in Section 24(a) hereof.
“Exercise
Price”
shall
have the meaning set forth in Section 4(a) hereof.
“Expiration
Date”
shall
mean the earliest to occur of: (i) the Close of Business on the Final Expiration
Date, (ii) the Redemption Date, or (iii) the time at which the Board of
Directors orders the exchange of the Rights as provided in Section 24 hereof.
“Final
Expiration Date”
shall
mean February 21,
2015.
“Nasdaq”
shall
mean the National Association of Securities Dealers, Inc. Automated Quotations
System.
“Permitted
Offer”
shall
mean a tender or exchange offer for all the outstanding shares of Common Stock
at a price and on terms that a majority of the members of the board of directors
who are independent from the acquiring person or the person making the offer
determines to be fair to and otherwise in the best interest of the Company
and
its shareholders.
“Person”
shall
mean any individual, firm, corporation or other entity, and shall include any
successor (by merger or otherwise) of such entity.
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“Post-event
Transferee”
shall
have the meaning set forth in Section 7(e) hereof.
“Preferred
Shares”
shall
mean shares of Series A Preferred Stock, $0.01 par value, of the Company.
“Pre-event
Transferee”
shall
have the meaning set forth in Section 7(e) hereof.
“Principal
Party”
shall
have the meaning set forth in Section 13(b) hereof.
“Record
Date”
shall
have the meaning set forth in the recitals at the beginning of this Rights
Agreement.
“Redemption
Date”
shall
have the meaning set forth in Section 23(a) hereof.
“Redemption
Price”
shall
have the meaning set forth in Section 23(a) hereof.
“Rights
Agent”
shall
mean Mellon Investor Services LLC, or its successor or replacement as provided
in Sections 19 and 21 hereof.
“Rights
Certificate”
shall
mean a certificate substantially in the form attached hereto as Exhibit
B.
“Section
11(a)(ii) Trigger Date”
shall
have the meaning set forth in Section 11(a)(iii) hereof.
“Section
13 Event”
shall
mean any event described in clause (i), (ii) or (iii) of Section 13(a) hereof.
“Securities
Act”
shall
mean the Securities Act of 1933, as amended.
“Shares
Acquisition Date”
shall
mean the first date of public announcement (which, for purposes of this
definition, shall include, without limitation, a report filed pursuant to
Section 13(d) under the Exchange Act) by the Company or an Acquiring Person
that
an Acquiring Person has become such; provided that, if such Person is determined
not to have become an Acquiring Person as defined herein, then no Shares
Acquisition Date shall be deemed to have occurred.
“Spread”
shall
have the meaning set forth in Section 11(a)(iii) hereof.
“Subsidiary”
of
any
Person shall mean any corporation or other entity of which an amount of voting
securities sufficient to elect a majority of the directors or Persons having
similar authority of such corporation or other entity is beneficially owned,
directly or indirectly, by such Person, or any corporation or other entity
otherwise controlled by such Person.
“Substitution
Period”
shall
have the meaning set forth in Section 11(a)(iii) hereof.
“Summary
of Rights”
shall
mean a summary of this Agreement substantially in the form attached hereto
as
Exhibit
C.
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“Total
Exercise Price”
shall
have the meaning set forth in Section 4(a) hereof.
“Trading
Day”
shall
mean a day on which the principal national securities exchange on which a
referenced security is listed or admitted to trading is open for the transaction
of business or, if a referenced security is not listed or admitted to trading
on
any national securities exchange, a Business Day.
A
“Triggering
Event”
shall
be deemed to have occurred upon any Person, becoming an Acquiring Person.
2. Appointment
of Rights Agent.
The
Company hereby appoints the Rights Agent to act as rights agent for the Company
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. The Rights Agent shall
have no duty to supervise, and in no event shall be liable for, the acts or
omissions of any such co-Rights Agent.
3. Issuance
of Rights Certificates.
(a) Until
the
Distribution Date, (i) the Rights will be evidenced (subject to the provisions
of Sections 3(b) and 3(c) hereof) by the certificates for shares of Common
Stock
registered in the names of the holders thereof (which certificates shall also
be
deemed to be Rights Certificates) and not by separate Rights Certificates and
(ii) the right to receive Rights Certificates will be transferable by, and
only
in connection with the transfer of shares of Common Stock. Until the earlier
of
the Distribution Date or the Expiration Date, the surrender for transfer of
certificates for shares of Common Stock shall also constitute the surrender
for
transfer of the Rights associated with the shares of Common Stock represented
thereby. As soon as practicable after the Distribution Date, the Company will
prepare and execute, the Rights Agent will countersign, and the Company will
send or cause to be sent (and the Rights Agent will, if requested and provided
with all necessary information, send) by first-class, postage-prepaid mail,
to
each record holder of shares 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 or the transfer agent or registrar for the Common Stock, a Rights
Certificate evidencing one Right for each share of Common Stock so held, subject
to adjustment as provided herein. In the event that an adjustment in the number
of Rights per share of Common Stock has been made pursuant to Section 11 hereof,
then at the time of distribution of the Rights Certificates, the Company shall
make the necessary and appropriate rounding adjustments (in accordance with
Section 14(a) hereof) so that Rights Certificates representing only whole
numbers of Rights are distributed and cash is paid in lieu of any fractional
Rights. As of and after the Distribution Date, the Rights will be evidenced
solely by such Rights Certificates and may be transferred by the transfer of
the
Rights Certificates as permitted hereby, separately and apart from any transfer
of shares of Common Stock, and the holders of such Rights Certificates as listed
in the records of the Company or any transfer agent or registrar for the Rights
shall be the record holders thereof.
(b) The
Company shall promptly notify the Rights Agent in writing upon the occurrence
of
the Distribution Date and, if such notification is given orally, the Company
shall confirm the same in writing on or prior to the Business Day next
following. Until such notice is
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received
by the Rights Agent, the Rights Agent may presume conclusively for all purposes
that the Distribution Date has not occurred.
(c) On
the
Record Date or as soon as practicable thereafter, the Company will send a copy
of the Summary of Rights by first-class, postage-prepaid mail, to each record
holder of shares of Common Stock as of the Close of Business on the Record
Date,
at the address of such holder shown on the records of the Company’s transfer
agent and registrar. With respect to certificates for shares of Common Stock
outstanding as of the Record Date, until the Distribution Date, the Rights
will
be evidenced by such certificates registered in the names of the holders thereof
together with the Summary of Rights. Until the Distribution Date (or, if
earlier, the Expiration Date), the surrender for transfer of any certificate
for
shares of Common Stock outstanding on the Record Date, with or without a copy
of
the Summary of Rights, shall also constitute the transfer of the Rights
associated with the shares of Common Stock represented thereby.
(d) Unless
the Board of Directors by resolution adopted at or before the time of the
issuance of any shares of Common Stock specifies to the contrary, Rights shall
be issued in respect of all shares of Common Stock that are issued after the
Record Date but prior to the earlier of the Distribution Date or the Expiration
Date or, in certain circumstances provided in Section 22 hereof, after the
Distribution Date. Certificates representing such shares of Common Stock shall
also be deemed to be certificates for Rights, and shall bear substantially
the
following legend:
THIS
CERTIFICATE ALSO EVIDENCES AND ENTITLES THE HOLDER HEREOF TO CERTAIN RIGHTS
AS
SET FORTH IN A SHAREHOLDERS
RIGHTS AGREEMENT BETWEEN GENCO SHIPPING & TRADING LIMITED AND MELLON
INVESTOR SERVICES LLC, AS THE RIGHTS AGENT, DATED AS OF APRIL 11, 2007 (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
GENCO SHIPPING & TRADING LIMITED. 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. GENCO SHIPPING &
TRADING LIMITED 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 SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS ISSUED TO,
OR
HELD BY, ANY PERSON WHO IS, WAS OR BECOMES AN ACQUIRING PERSON OR ANY AFFILIATE
OR ASSOCIATE THEREOF (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT),
WHETHER CURRENTLY HELD BY OR ON BEHALF OF SUCH PERSON OR BY ANY SUBSEQUENT
HOLDER, MAY BECOME NULL AND VOID.
(e) With
respect to such certificates containing the foregoing legend, until the earlier
of (i) the Distribution Date or (ii) the Expiration Date, the Rights associated
with the 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.
(f) In
the
event that the Company purchases or acquires any shares of Common Stock after
the Record Date but prior to the Distribution Date, any Rights associated with
such shares of Common Stock shall be deemed canceled and retired so that the
Company shall not be entitled to exercise any Rights associated with the shares
of Common Stock which are no longer outstanding.
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4. Form
of Rights Certificates.
(a) The
Rights 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 in the form of Exhibit
B
hereto
and may have such marks of identification or designation and such legends,
summaries or endorsements printed thereon as the Company may deem appropriate
(but which do not affect the rights, duties or responsibilities of the Rights
Agent) and as are not inconsistent with the provisions of this Agreement, or
as
may be required to comply with any applicable law or with any rule or regulation
made pursuant thereto or with any rule or regulation of any stock exchange
or a
national market system, on which the Rights may from time to time be listed
or
included, or to conform to usage. Subject to the provisions of Section 11 and
Section 22 hereof, the Rights Certificates, whenever distributed, shall be
dated
as of the Record Date (or in the case of Rights issued with respect to shares
of
Common Stock issued by the Company after the Record Date, as of the date of
issuance of such shares of Common Stock) and on their face shall entitle the
holders thereof to purchase such number of one- thousandths of a Preferred
Share
as shall be set forth therein at the price set forth therein (such exercise
price per one one-thousandth of a Preferred Share being hereinafter referred
to
as the “Exercise
Price”
and
the
aggregate Exercise Price of all Preferred Shares issuable upon exercise of
one
Right being hereinafter referred to as the “Total
Exercise Price”),
but
the number and type of securities purchasable upon the exercise of each Right
and the Exercise Price shall be subject to adjustment as provided herein.
(b) Any
Rights Certificate issued pursuant to Section 3(a) or Section 22 hereof that
represents Rights beneficially owned by: (i) an Acquiring Person or any
Associate or Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring
Person (or of any such Associate or Affiliate) who becomes a transferee after
the Acquiring Person becomes such or (iii) a transferee of an Acquiring Person
(or of any such Associate or Affiliate) who becomes a transferee prior to or
concurrently with the Acquiring Person becoming such and receives such Rights
pursuant to either (A) a transfer (whether or not for consideration) from the
Acquiring Person to holders of equity interests in such Acquiring Person or
to
any Person with whom such Acquiring Person has any continuing agreement,
arrangement or understanding regarding the transferred Rights or (B) a transfer
which the Company’s Board of Directors has determined is part of a plan,
arrangement or understanding which has as a primary purpose or effect avoidance
of Section 7(e) hereof, and any Rights Certificate issued pursuant to Section
6
or Section 11 hereof upon transfer, exchange, replacement or adjustment of
any
other Rights Certificate referred to in this sentence, shall contain, provided
that the Company has notified the Rights Agent that this Section 4(b) applies,
and to the extent feasible, the following legend:
THE
RIGHTS REPRESENTED BY THIS RIGHTS CERTIFICATE ARE OR WERE BENEFICIALLY OWNED
BY
A PERSON WHO WAS OR BECAME AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE
OF
AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT).
ACCORDINGLY, THIS RIGHTS CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY
BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF THE
RIGHTS AGREEMENT
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5. Countersignature
and Registration.
(a) The
Rights Certificates shall be executed on behalf of the Company by its Chairman
of the Board, its Chief Executive Officer, its Chief Financial Officer, its
President or any Vice President, either manually or by facsimile signature,
and
by the Secretary or an Assistant Secretary of the Company, either manually
or by
facsimile signature, and shall have affixed thereto the Company’s seal (if any)
or a facsimile thereof. The Rights Certificates shall be manually countersigned
by the Rights Agent and shall not be valid for any purpose unless countersigned.
In case any officer of the Company who shall have signed any of the Rights
Certificates shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by the Company,
such Rights Certificates, nevertheless, may be countersigned by the Rights
Agent
and issued and delivered by the Company with the same force and effect as though
the person who signed such Rights Certificates on behalf of the Company had
not
ceased to be such officer of the Company; and any Rights Certificate may be
signed on behalf of the Company by any person who, at the actual date of the
execution of such Rights Certificate, shall be a proper officer of the Company
to sign such Rights Certificate, although at the date of the execution of this
Rights Agreement any such person was not such an officer.
(b) Following
the Distribution Date, receipt by the Rights Agent of notice to that effect
and
all other relevant information referred to in Section 3(a), the Rights Agent
will keep or cause to be kept, at its office designated for such purposes,
books
for registration and transfer of the Rights Certificates issued hereunder.
Such
books shall show the names and addresses of the respective holders of the Rights
Certificates, the number of Rights evidenced on its face by each of the Rights
Certificates and the date of each of the Rights Certificates.
6. Transfer,
Split Up, Combination and Exchange of Rights Certificates; Mutilated, Destroyed,
Lost or Stolen Rights Certificates.
(a) Subject
to the provisions of Sections 7(e), 14 and 24 hereof, at any time after the
Close of Business on the Distribution Date, and at or prior to the Close of
Business on the Expiration Date, any Rights Certificate or Rights Certificates
may be transferred, split up, combined or exchanged for another Rights
Certificate or Rights Certificates, entitling the registered holder to purchase
a like number of one-thousandths of a Preferred Share (or, following a
Triggering Event, other securities, cash or other assets, as the case may be)
as
the Rights Certificate or Rights Certificates surrendered then entitled such
holder to purchase. Any registered holder desiring to transfer, split up,
combine or exchange any Rights Certificate or Rights Certificates shall make
such request in writing delivered to the Rights Agent, and shall surrender
the
Rights Certificate or Rights Certificates to be transferred, split up, combined
or exchanged at the office of the Rights Agent designated for such purpose.
The
Right Certificates are transferable only on the registry books 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 Rights
Certificate until the registered holder shall have completed and signed the
certificate contained in the form of assignment on the reverse side of such
Rights Certificate and shall have provided such additional evidence of the
identity of the Beneficial Owner (or former Beneficial Owner) or Affiliates
or
Associates thereof as the Company or the Rights Agent shall
reasonably request and paid a sum sufficient to cover any tax or charge that
may
be
10
imposed
in connection with any transfer, split up, combination or exchange of Rights
Certificates as required by Section 9(e) hereof. Thereupon the Rights Agent
shall, subject to Sections 7(e), 14 and 24 hereof, countersign and deliver
to
the person entitled thereto a Rights Certificate or Rights Certificates, as
the
case may be, as so requested, registered in such name or names as may be
designated by the surrendering registered holder. The Company may require
payment of a sum sufficient to cover any tax or governmental charge that may
be
imposed in connection with any transfer, split up, combination or exchange
of
Rights Certificates. The Rights Agent shall have no duty or obligation under
this Section unless and until it is satisfied that all such taxes and/or
governmental charges have been paid.
(b) Upon
receipt by the Company and the Rights Agent of evidence reasonably satisfactory
to them of the loss, theft, destruction or mutilation of a Rights Certificate,
and, in case of loss, theft or destruction, of indemnity or security reasonably
satisfactory to them, and, at the Company’s request, reimbursement to the
Company and the Rights Agent of all reasonable expenses incidental thereto,
and
upon surrender to the Rights Agent and cancellation of the Rights Certificate
if
mutilated, the Company will make and deliver a new Rights Certificate of like
tenor to the Rights Agent for countersignature and delivery to the registered
holder in lieu of the Rights Certificate so lost, stolen, destroyed or
mutilated.
7. Exercise
of Rights; Exercise Price; Expiration Date of Rights.
(a) Subject
to Sections 7(e), 23(b) and 24(b) hereof, the registered holder of any Rights
Certificate may exercise the Rights evidenced thereby (except as otherwise
provided herein) in whole or in part at any time after the Distribution Date
and
prior to the Close of Business on the Expiration Date by surrender of the Rights
Certificate, with the form of election to purchase on the reverse side thereof
duly executed, to the Rights Agent at the office of the Rights Agent designated
for such purpose, together with payment of the Exercise Price for each
one-thousandth of a Preferred Share (or, following a Triggering Event, other
securities, cash or other assets as the case may be) as to which the Rights
are
exercised, and an amount equal to any tax or charge required to be paid under
Section 9(3) hereof, by certified check, cashier’s check, bank draft or money
order payable to the order of the Company. Except for those provisions herein
which expressly survive the termination of this Agreement, this Agreement shall
terminate at such time as the Rights are no longer exercisable.
(b) The
Exercise Price for each one-thousandth of a Preferred Share issuable pursuant
to
the exercise of a Right shall initially be Twenty-Five Dollars ($25), 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.
(c) Upon
receipt of a Rights Certificate representing exercisable Rights, with the form
of election to purchase duly executed, accompanied by payment of the Exercise
Price for the number of one-thousandths of a Preferred Share (or, following
a
Triggering Event, other securities, cash or other assets as the case may be)
to
be purchased and an amount equal to any applicable transfer tax required to
be
paid by the holder of such Rights Certificate in accordance with Section 9(e)
hereof, the Rights Agent shall, subject to Section 20(k) hereof, thereupon
promptly (i) (A) requisition from any transfer agent of the Preferred Shares
(or
make available, if the
Rights Agent is the transfer agent for the Preferred Shares) a certificate
or
certificates for the
11
number
of
one-thousandths of a Preferred Share (or, following a Triggering Event, other
securities, cash or other assets as the case may be) to be purchased and the
Company hereby irrevocably authorizes its transfer agent to comply with all
such
requests or (B) if the Company shall have elected to deposit the total number
of
one-thousandths of a Preferred Share (or, following a Triggering Event, other
securities, cash or other assets as the case may be) issuable upon exercise
of
the Rights hereunder with a depositary agent, requisition from the depositary
agent depositary receipts representing such number of one-thousandths of a
Preferred Share (or, following a Triggering Event, other securities, cash or
other assets as the case may be) as are to be purchased (in which case
certificates for the Preferred Shares (or, following a Triggering Event, other
securities, cash or other assets as the case may be) represented by such
receipts shall be deposited by the transfer agent with the depositary agent)
and
the Company hereby directs the depositary agent to comply with such request,
(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
hereof, (iii) after receipt of such certificates or depositary receipts, cause
the same to be delivered to or upon the order of the registered holder of such
Rights Certificate, registered in such name or names as may be designated by
such holder and (iv) when appropriate, after receipt thereof, deliver such
cash
to or upon the order of the registered holder of such Rights Certificate. The
payment of the Exercise Price (as such amount may be reduced (including to
zero)
pursuant to Section 11(a)(iii) hereof) and an amount equal to any applicable
transfer tax required to be paid by the holder of such Rights Certificate in
accordance with Section 9(e) hereof, may be made in cash or by certified bank
check, cashier’s check or bank draft payable to the order of the Company. In the
event that the Company is obligated to issue securities of the Company other
than Preferred Shares, pay cash and/or distribute other property pursuant to
Section 11(a) hereof, the Company will make all arrangements necessary so that
such other securities, cash and/or other property are available for distribution
by the Rights Agent, if and when appropriate.
(d) In
case
the registered holder of any Rights Certificate shall exercise less than all
the
Rights evidenced thereby, a new Rights Certificate evidencing Rights equivalent
to the Rights remaining unexercised shall be issued by the Rights Agent to
the
registered holder of such Rights Certificate or to his or her duly authorized
assigns, subject to the provisions of Section 14 hereof.
(e) Notwithstanding
anything in this Agreement to the contrary, from and after the first occurrence
of a Triggering Event, any Rights beneficially owned by (i) an Acquiring Person
or an Associate or Affiliate of an Acquiring Person, (ii) a transferee of an
Acquiring Person (or of any such Associate or Affiliate) who becomes a
transferee after the Acquiring Person becomes such (a “Post-Event
Transferee”),
(iii)
a transferee of an Acquiring Person (or of any such Associate or Affiliate)
who
becomes a transferee prior to or concurrently with the Acquiring Person becoming
such and receives such Rights pursuant to either (A) a transfer (whether or
not
for consideration) from the Acquiring Person to holders of equity interests
in
such Acquiring Person or to any Person with whom the Acquiring Person has any
continuing agreement, arrangement or understanding regarding the transferred
Rights or (B) a transfer which the Company’s Board of Directors has determined
is part of a plan, arrangement or understanding which has as a primary purpose
or effect the avoidance of this Section 7(e) (a “Pre-Event
Transferee”)
or
(iv) any subsequent transferee receiving transferred Rights from a Post-Event
Transferee or a Pre-Event Transferee, either directly or through one or
more
12
intermediate
transferees, shall become null and void without any further action and no holder
of such Rights shall have any rights whatsoever with respect to such Rights,
whether under any provision of this Agreement or otherwise. The Company shall
use all reasonable efforts to ensure that the provisions of this Section 7(e)
and Section 4(b) hereof are complied with, but shall have no liability to any
holder of Rights Certificates or to any other Person as a result of its failure
to make any determinations with respect to an Acquiring Person or any of such
Acquiring Person’s Affiliates, Associates or transferees hereunder.
(f) Notwithstanding
anything in this Agreement to the contrary, neither the Rights Agent nor the
Company shall be obligated to undertake any action with respect to a registered
holder upon the occurrence of any purported exercise as set forth in this
Section 7 unless such registered holder shall, in addition to having complied
with the requirements of Section 7(a), have (i) properly completed and signed
the certificate contained in the form of election to purchase set forth on
the
reverse side of the Rights Certificate surrendered for such exercise and (ii)
provided such additional evidence of the identity of the Beneficial Owner (or
former Beneficial Owner) or Affiliates or Associates thereof as the Company
or
the Rights Agent shall reasonably request.
8. Cancellation
and Destruction of Rights Certificates.
All
Rights Certificates surrendered for the purpose of exercise, transfer, split
up,
combination or exchange shall, if surrendered to the Company or to any of its
agents, be delivered to the Rights Agent for cancellation or in canceled form,
or, if surrendered to the Rights Agent, shall be canceled by it, and no Rights
Certificates shall be issued in lieu thereof except as expressly permitted
by
any of the provisions of this Agreement. The Company shall deliver to the Rights
Agent for cancellation and retirement, and the Rights Agent shall so cancel
and
retire, any Rights Certificate purchased or acquired by the Company otherwise
than upon the exercise thereof. The Rights Agent shall deliver all canceled
Rights Certificates to the Company, or shall, at the written request of the
Company, destroy such canceled Rights Certificates, and in such case shall
deliver a certificate of destruction thereof to the Company.
9. Reservation
and Availability of Preferred Shares.
(a) The
Company covenants and agrees that it will cause to be reserved and kept
available out of its authorized and unissued Preferred Shares not reserved
for
another purpose (and, following the occurrence of a Triggering Event, out of
its
authorized and unissued shares of Common Stock and/or other securities), the
number of Preferred Shares (and, following the occurrence of the Triggering
Event, Common Stock and/or other securities) that will be sufficient to permit
the exercise in full of all outstanding Rights.
(b) If
the
Company shall hereafter list any of its Preferred Shares on a national
securities exchange, then so long as the Preferred Shares (and, following the
occurrence of a Triggering Event, shares of Common Stock and/or other
securities) issuable and deliverable upon exercise of the Rights may be listed
on such exchange, the Company shall use its best efforts to cause, from and
after such time as the Rights become exercisable (but only to the extent that
it
is reasonably likely that the Rights will be exercised), all shares reserved
for
such issuance to be listed on such exchange upon official notice of issuance
upon such exercise.
13
(c)
The
Company shall use its best efforts to (i) file, as soon as practicable following
the earliest date after the first occurrence of a Triggering Event in which
the
consideration to be delivered by the Company upon exercise of the Rights is
described in Section 11(a)(ii) or Section 11(a)(iii) hereof, or as soon as
is
required by law following the Distribution Date, as the case may be, a
registration statement under the Securities Act with respect to the securities
purchasable upon exercise of the Rights on an appropriate form, (ii) cause
such
registration statement to become effective as soon as practicable after such
filing and (iii) cause such registration statement to remain effective (with
a
prospectus at all times meeting the requirements of the Securities Act) until
the earlier of (A) the date as of which the Rights are no longer exercisable
for
such securities and (B) the Expiration Date. The Company may temporarily
suspend, for a period not to exceed ninety (90) days after the date set forth
in
clause (i) of the first sentence of this Section 9(c), the exercisability of
the
Rights in order to prepare and file such registration statement and permit
it to
become effective. Upon any such suspension, the Company shall issue a public
announcement and give the Rights Agent a copy of such announcement that
exercisability of the Rights has been temporarily suspended, as well as a public
announcement and copy to the Rights Agent at such time as the suspension is
no
longer in effect. The Company will also take such action as may be appropriate
under, or to ensure compliance with, the securities or “blue sky” laws of the
various states in connection with the exercisability of the Rights.
Notwithstanding any provision of this Agreement to the contrary, the Rights
shall not be exercisable in any jurisdiction, unless the requisite qualification
in such jurisdiction shall have been obtained, or an exemption therefrom shall
be available, and until a registration statement has been declared
effective.
(d) The
Company covenants and agrees that it will take all such action as may be
necessary to ensure that all Preferred Shares (or other securities of the
Company) delivered upon exercise of Rights shall, at the time of delivery of
the
certificates for such securities (subject to payment of the Exercise Price),
be
duly and validly authorized and issued and fully paid and nonassessable shares.
(e) The
Company further covenants and agrees that it will pay when due and payable
any
and all federal and state transfer taxes and charges which may be payable in
respect of the original issuance or delivery of the Rights Certificates or
of
any Preferred Shares (or other securities of the Company) upon the exercise
of
Rights. The Company shall not, however, be required to pay any transfer tax
which may be payable in respect of any transfer or delivery of Rights
Certificates to a person other than, or the issuance or delivery of certificates
or depositary receipts for the Preferred Shares (or other securities of the
Company) in a name other than that of, the registered holder of the Rights
Certificate evidencing Rights surrendered for exercise or to issue or to deliver
any certificates or depositary receipts for Preferred Shares (or other
securities of the Company) upon the exercise of any Rights until any such tax
shall have been paid (any such tax being payable by the holder of such Rights
Certificate at the time of surrender) or until it has been established to the
Company’s or the Rights Agent’s satisfaction that no such tax is due.
10. Record
Date.
Each
Person in whose name any certificate for a number of one-thousandths of a
Preferred Share (or other securities of the Company) is issued upon the exercise
of Rights shall for all purposes be deemed to have become the holder of record
of Preferred Shares (or other securities of the Company) represented thereon,
and such certificate shall be
14
dated,
the date upon which the Rights Certificate evidencing such Rights was duly
surrendered and payment of the Total Exercise Price with respect to which the
Rights have been exercised (and any applicable transfer taxes) was made;
provided,
however,
that if
the date of such surrender and payment is a date upon which the 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 transfer books of the Company are open.
Prior to the exercise of the Rights evidenced thereby, the holder of a Rights
Certificate shall not be entitled to any rights of a holder of Preferred Shares
(or other securities of the Company) for which the Rights shall be exercisable,
including, without limitation, the right to vote, to receive dividends or other
distributions or to exercise any preemptive rights, and shall not be entitled
to
receive any notice of any proceedings of the Company, except as provided herein.
11. Adjustment
of Exercise Price, Number of Shares or Number of Rights.
The
Exercise Price, the number and kind of shares or other property 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)
Notwithstanding anything in this Agreement to the contrary, in the event the
Company shall at any time after the date of this Agreement (A) declare a
dividend on the Preferred Shares payable in Preferred Shares, (B) subdivide
the
outstanding Preferred Shares, (C) combine the outstanding Preferred Shares
(by
reverse stock split or otherwise) into a smaller number of Preferred Shares,
or
(D) issue any shares of its capital stock in a reclassification of the Preferred
Shares (including any such reclassification in connection with a consolidation
or merger in which the Company is the continuing or surviving corporation),
then, in each such event, except as otherwise provided in this Section 11 and
Section 7(e) hereof: (1) the Exercise Price in effect at the time of the record
date for such dividend or of the effective date of such subdivision, combination
or reclassification shall be adjusted so that the Exercise Price thereafter
shall equal the result obtained by dividing the Exercise Price in effect
immediately prior to such time by a fraction (the “Adjustment
Fraction”),
the
numerator of which shall be the total number of Preferred Shares (or shares
of
capital stock issued in such reclassification of the Preferred Shares)
outstanding immediately following such time and the denominator of which shall
be the total number of Preferred Shares outstanding immediately prior to such
time; 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 capital stock of the Company
issuable upon exercise of such Right; and (2) the number of one-thousandths
of a
Preferred Share (or share of such other capital stock) issuable upon the
exercise of each Right shall equal the number of one-thousandths of a Preferred
Share (or share of such other capital stock) as was issuable upon exercise
of a
Right immediately prior to the occurrence of the event described in clauses
(A)-(D) of this Section 11(a)(i), multiplied by the Adjustment Fraction;
provided,
however,
that,
no such adjustment shall be made pursuant to this Section 11(a)(i) to the extent
that there shall have simultaneously occurred an event described in clause
(A),
(B), (C) or (D) of Section 11(n) with a proportionate adjustment being made
thereunder.
15
Each
share of Common Stock that shall become outstanding after an adjustment has
been
made pursuant to this Section 11(a)(i) shall have associated with it the number
of Rights, exercisable at the Exercise Price and for the number of
one-thousandths of a Preferred Share (or shares of such other capital stock)
as
one share of Common Stock has associated with it immediately following the
adjustment made pursuant to this Section 11(a)(i).
(ii)
Subject to Section 24 of this Agreement, in the event a Triggering Event shall
have occurred, then promptly following such Triggering Event each holder of
a
Right, except as provided in Section 7(e) hereof, shall thereafter have the
right to receive for each Right, upon exercise thereof in accordance with the
terms of this Agreement and payment of the Exercise Price in effect immediately
prior to the occurrence of the Triggering Event, in lieu of a number of
one-thousandths of a Preferred Share, such number of shares of Common Stock
of
the Company as shall equal the result obtained by multiplying the Exercise
Price
in effect immediately prior to the occurrence of the Triggering Event by the
number of one-thousandths of a Preferred Share for which a Right was exercisable
(or would have been exercisable if the Distribution Date had occurred)
immediately prior to the first occurrence of a Triggering Event, and dividing
that product by 50% of the Current Per Share Market Price for shares of Common
Stock on the date of occurrence of the Triggering Event; provided,
however,
that
the Exercise Price and the number of shares of Common Stock of the Company
so
receivable upon exercise of a Right shall be subject to further adjustment
as
appropriate in accordance with Section 11(e) hereof to reflect any events
occurring in respect of the shares of Common Stock of the Company after the
occurrence of the Triggering Event.
(iii)
In
lieu of issuing shares of Common Stock in accordance with Section 11(a)(ii)
hereof, the Company may, if the Company’s Board of Directors determines that
such action is necessary or appropriate and not contrary to the interest of
holders of Rights and, in the event that the number of shares of Common Stock
which are authorized by the Company’s Certificate of Incorporation but not
outstanding or reserved for issuance for purposes other than upon exercise
of
the Rights are not sufficient to permit the exercise in full of the Rights,
or
if any necessary regulatory approval for such issuance has not been obtained
by
the Company, the Company shall: (A) determine the excess of (1) the value of
the
shares of Common Stock issuable upon the exercise of a Right (the “Current
Value”)
over
(2) the Exercise Price (such excess, the “Spread”)
and
(B) with respect to each Right, make adequate provision to substitute for such
shares of Common Stock, upon exercise of the Rights, (1) cash, (2) a reduction
in the Exercise Price, (3) other equity securities of the Company (including,
without limitation, shares or units of shares of any series of preferred stock
which the Company’s Board of Directors has deemed to have the same value as
Common Stock (such shares or units of shares of preferred stock are herein
called “Common
Stock Equivalents”)),
except to the extent that the Company has not obtained any necessary Shareholder
or regulatory approval for such issuance, (4) debt securities of the Company,
except to the extent that the Company has not
16
obtained
any necessary Shareholder or regulatory approval for such issuance, (5) other
assets or (6) any combination of the foregoing, having an aggregate value equal
to the Current Value, where such aggregate value has been determined by the
Company’s Board of Directors based upon the advice of a nationally recognized
investment banking firm selected by the Company’s Board of Directors;
provided,
however,
if the
Company shall not have made adequate provision to deliver value pursuant to
clause (B) above within thirty (30) days following the later of (x) the first
occurrence of a Triggering Event and (y) the date on which the Company’s right
of redemption pursuant to Section 23(a) expires (the later of (x) and (y) being
referred to herein as the “Section
11(a)(ii) Trigger Date”),
then
the Company shall be obligated to deliver, upon the surrender for exercise
of a
Right and without requiring payment of the Exercise Price, Common Stock (to
the
extent available), except to the extent that the Company has not obtained any
necessary Shareholder or regulatory approval for such issuance, and then, if
necessary, cash, which shares and/or cash have an aggregate value equal to
the
Spread. If the Company’s Board of Directors shall determine in good faith that
it is likely that sufficient additional Common Stock could be authorized for
issuance upon exercise in full of the Rights or that any necessary regulatory
approval for such issuance will be obtained, the thirty (30) day period set
forth above may be extended to the extent necessary, but not more than ninety
(90) days after the Section 11(a)(ii) Trigger Date, in order that the Company
may seek Shareholder approval for the authorization of such additional shares
or
take action to obtain such regulatory approval (such period, as it may be
extended, the “Substitution
Period”).
To
the extent that the Company determines that some action need be taken pursuant
to the first and/or second sentences of this Section 11(a)(iii), the Company
(x)
shall provide, subject to Section 7(e) hereof, that such action shall apply
uniformly to all outstanding Rights and (y) may suspend the exercisability
of
the Rights until the expiration of the Substitution Period in order to seek
any
authorization of additional shares, to take any action to obtain any required
regulatory approval and/or to decide the appropriate form of distribution to
be
made pursuant to such first sentence and to determine the value thereof. In
the
event of any such suspension, the Company shall issue a public announcement
stating that the exercisability of the Rights has been temporarily suspended,
as
well as a public announcement at such time as the suspension is no longer in
effect, (in each case, with prompt written notice thereof to the Rights Agent).
For purposes of this Section 11(a)(iii), the value of the Common Stock shall
be
the Current Per Share Market Price of the Common Stock on the Section 11(a)(ii)
Trigger Date and the value of any Common Stock Equivalent shall be deemed to
have the same value as the Common Stock on such date.
(b) In
case
the Company shall, at any time after the date of this Agreement, fix a record
date for the issuance of rights, options or warrants to all holders of Preferred
Shares entitling such holders (for a period expiring within forty-five (45)
calendar days after such record date) to subscribe for or purchase Preferred
Shares or Equivalent Shares or securities convertible into Preferred Shares
or
Equivalent Shares at a price per share (or having a conversion price per share,
if a security convertible into Preferred Shares or Equivalent Shares) less
than
the then
17
Current
Per Share Market Price of the Preferred Shares or Equivalent Shares on such
record date, then, in each such case, the Exercise Price to be in effect after
such record date shall be determined by multiplying the Exercise Price in effect
immediately prior to such record date by a fraction, the numerator of which
shall be the number of Preferred Shares and Equivalent Shares (if any)
outstanding on such record date, plus the number of Preferred Shares or
Equivalent Shares, as the case may be, which the aggregate offering price of
the
total number of Preferred Shares or Equivalent Shares, as the case may be,
to be
offered or issued (and/or the aggregate initial conversion price of the
convertible securities to be offered or issued) would purchase at such current
market price, and the denominator of which shall be the number of Preferred
Shares and Equivalent Shares (if any) outstanding on such record date, plus
the
number of additional Preferred Shares or Equivalent Shares, as the case may
be,
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 capital stock of the Company
issuable upon exercise of one Right. In case such subscription price may be
paid
in a 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
Company’s Board of Directors, whose determination shall be described in a
statement filed with the Rights Agent and shall be binding on the Rights Agent
and the holders of the Rights. Preferred Shares and Equivalent Shares owned
by
or held for the account of the Company shall not be deemed outstanding for
the
purpose of any such computation. Such adjustment shall be made successively
whenever such a record date is fixed, and in the event that such rights, options
or warrants are not so issued, the Exercise Price shall be adjusted to be the
Exercise Price which would then be in effect if such record date had not been
fixed.
(c) In
case
the Company shall, at any time after the date of this Agreement, fix a record
date for the making of a distribution to all holders of the Preferred Shares
or
of any class or series of Equivalent Shares (including any such distribution
made in connection with a consolidation or merger in which the Company is the
continuing or surviving corporation) of evidences of indebtedness or assets
(other than a regular quarterly cash dividend, if any, or a dividend payable
in
Preferred Shares) or subscription rights, options or warrants (excluding those
referred to in Section 11(b)), then, in each such case, the Exercise Price
to be
in effect after such record date shall be determined by multiplying the Exercise
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 a Preferred
Share or an Equivalent Share on such record date, less the fair market value
per
Preferred Share or Equivalent 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) of the portion of the cash, assets or evidences
of
indebtedness so to be distributed or of such subscription rights or warrants
applicable to a Preferred Share or Equivalent Share, as the case may be, and
the
denominator of which shall be such Current Per Share Market Price of a Preferred
Share or Equivalent Share on such record date; 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 capital stock of the Company
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 Exercise Price shall be adjusted to be the Exercise Price
which
would have been in effect if such record date had not been fixed.
18
(d)
Notwithstanding anything to the contrary, no adjustment in the Exercise Price
shall be required unless such adjustment would require an increase or decrease
of at least 1% in the Exercise Price; provided,
however,
that
any adjustments which by reason of this Section 11(d) are not required to be
made shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Section 11 shall be made to the nearest
cent or to the nearest ten-thousandth of a share of Common Stock or other share
or one hundred-thousandth of a Preferred Share, as the case may be.
Notwithstanding the first sentence of this Section 11(d), any adjustment
required by this Section 11 shall be made no later than the earlier of (i)
three
(3) years from the date of the transaction which requires such adjustment or
(ii) the Expiration Date.
(e) If
as a
result of an adjustment made pursuant to Section 11(a) or 13(a) hereof, the
holder of any Right thereafter exercised shall become entitled to receive any
shares of capital stock other than Preferred Shares, thereafter the number
of
such other shares so receivable upon exercise of any Right and, if required,
the
Exercise Price thereof, shall be subject to adjustment from time to time in
a
manner and on terms as nearly equivalent as practicable to the provisions with
respect to the Preferred Shares contained in Sections 11(a), 11(b), 11(c),
11(d), 11(g), 11(h), 11(i), 11(j), 11(k) and 11(l), and the provisions of
Sections 7, 9, 10, 13 and 14 with respect to the Preferred Shares shall apply
on
like terms to any such other shares.
(f) All
Rights originally issued by the Company subsequent to any adjustment made to
the
Exercise Price hereunder shall evidence the right to purchase, at the adjusted
Exercise Price, the number of one-thousandths of a Preferred Share purchasable
from time to time hereunder upon exercise of the Rights, all subject to further
adjustment as provided herein.
(g) Unless
the Company shall have exercised its election as provided in Section 11(h),
upon
each adjustment of the Exercise 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
Exercise Price, that number of Preferred Shares (calculated to the nearest
one
hundred-thousandth of a share) obtained by (i) multiplying (x) the number of
Preferred Shares covered by a Right immediately prior to this adjustment, by
(y)
the Exercise Price in effect immediately prior to such adjustment of the
Exercise Price, and (ii) dividing the product so obtained by the Exercise Price
in effect immediately after such adjustment of the Exercise Price.
(h) The
Company may elect on or after the date of any adjustment of the Exercise Price
as a result of the calculations made in Section 11(b) or (c) to adjust the
number of Rights, in substitution for any adjustment in the number of Preferred
Shares 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 one-thousandths of a Preferred Share for which a Right was exercisable
immediately prior to such adjustment. Each Right held of record prior to such
adjustment of the number of Rights shall become that number of Rights
(calculated to the nearest one hundred-thousandth) obtained by dividing the
Exercise Price in effect immediately prior to adjustment of the Exercise Price
by the Exercise Price in effect immediately after adjustment of the Exercise
Price. The Company shall make a public announcement of its election to adjust
the number of Rights (with prompt written notice thereof to the Rights Agent),
indicating the record date for the adjustment, and, if known at the time, the
amount of the
19
adjustment
to be made. This record date may be the date on which the Exercise Price is
adjusted or any day thereafter, but, if the Rights Certificates have been
issued, shall be at least ten (10) days later than the date of the public
announcement. If Rights Certificates have been issued, upon each adjustment
of
the number of Rights pursuant to this Section 11(h), the Company shall, as
promptly as practicable, cause to be distributed to holders of record of Rights
Certificates on such record date Rights Certificates evidencing, subject to
Section 14 hereof, the additional Rights to which such holders shall be entitled
as a result of such adjustment, or, at the option of the Company, shall cause
to
be distributed to such holders of record in substitution and replacement for
the
Rights Certificates held by such holders prior to the date of adjustment, and
upon surrender thereof, if required by the Company, new Rights Certificates
evidencing all the Rights to which such holders shall be entitled after such
adjustment. Rights Certificates so to be distributed shall be issued, executed
and countersigned in the manner provided for herein (and may bear, at the option
of the Company, the adjusted Exercise Price) and shall be registered in the
names of the holders of record of Rights Certificates on the record date
specified in the public announcement.
(i) Irrespective
of any adjustment or change in the Exercise Price or the number of Preferred
Shares issuable upon the exercise of the Rights, the Rights Certificates
theretofore and thereafter issued may continue to express the Exercise Price
per
one one-thousandth of a Preferred Share and the number of one-thousandths of
a
Preferred Share which were expressed in the initial Rights Certificates issued
hereunder.
(j) Before
taking any action that would cause an adjustment reducing the Exercise Price
below the par or stated value, if any, of the number of one-thousandths of
a
Preferred Share 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 as fully paid and nonassessable
shares such number of one-thousandths of a Preferred Share at such adjusted
Exercise Price.
(k) In
any
case in which this Section 11 shall require that an adjustment in the Exercise
Price be made effective as of a record date for a specified event, the Company
may elect to defer (with prompt written notice thereof to the Rights Agent)
until the occurrence of such event the issuing to the holder of any Right
exercised after such record date of the number of one-thousandths of a Preferred
Share and other capital stock or securities of the Company, if any, issuable
upon such exercise over and above the number of one-thousandths of a Preferred
Share and other capital stock or securities of the Company, if any, issuable
upon such exercise on the basis of the Exercise Price in effect prior to such
adjustment; provided, however, that the Company shall deliver to such holder
a
due xxxx or other appropriate instrument evidencing such holder’s right to
receive such additional shares (fractional or otherwise) upon the occurrence
of
the event requiring such adjustment.
(l) Notwithstanding
anything in this Section 11 to the contrary, prior to the Distribution Date,
the
Company shall be entitled to make such reductions in the Exercise 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 (i) consolidation or subdivision of the Preferred Shares or
Common Stock, (ii) issuance wholly for cash of any Preferred Shares or Common
Stock at less than the current market price, (iii) issuance wholly
for
20
cash
of
Preferred Shares or Common Stock or securities which by their terms are
convertible into or exchangeable for Preferred or Common Stock, (iv) stock
dividends or (v) issuance of rights, options or warrants referred to in this
Section 11, hereafter made by the Company to holders of its Preferred Shares
or
Common Stock shall not be taxable to such Shareholders.
(m) The
Company covenants and agrees that, after the Distribution Date, it will not,
except as permitted by Sections 23, 24 or 27 hereof, take (or permit to be
taken) any action if at the time such action is taken it is reasonably
foreseeable that such action will diminish substantially or otherwise eliminate
the benefits intended to be afforded by the Rights.
(n) 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 shares of Common Stock, (B) subdivide
the outstanding shares of Common Stock, (C) combine the outstanding Common
Stock
(by reverse stock split or otherwise) into a smaller number of shares of Common
Stock, or (D) issue any shares of its capital stock in a reclassification of
the
shares of Common Stock (including any such reclassification in connection with
a
consolidation or merger in which the Company is the continuing or surviving
corporation), then, in each such event, except as otherwise provided in this
Section 11(a) and Section 7(e) hereof: (1) each share of Common Stock (or shares
of capital stock issued in such reclassification of the Common Stock)
outstanding immediately following such time shall have associated with it the
number of Rights as were associated with one share of Common Stock immediately
prior to the occurrence of the event described in clauses (A)-(D) above; (2)
the
Exercise Price in effect at the time of the record date for such dividend or
of
the effective date of such subdivision, combination or reclassification shall
be
adjusted so that the Exercise Price thereafter shall equal the result obtained
by multiplying the Exercise Price in effect immediately prior to such time
by a
fraction, the numerator of which shall be the total number of shares of Common
Stock outstanding immediately prior to the event described in clauses (A)-(D)
above, and the denominator of which shall be the total number of shares of
Common Stock outstanding immediately after such event; 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 capital stock of the Company
issuable upon exercise of such Right; and (3) the number of one-thousandths
of a
Preferred Share (or shares of such other capital stock) issuable upon the
exercise of each Right outstanding after such event shall equal the number
of
one- thousandths of a Preferred Share (or shares of such other capital stock)
as
were issuable with respect to one Right immediately prior to such event. Each
share of Common Stock that shall become outstanding after an adjustment has
been
made pursuant to this Section 11(n) shall have associated with it the number
of
Rights, exercisable at the Exercise Price and for the number of one-thousandths
of a Preferred Share (or shares of such other capital stock) as one share of
Common Stock has associated with it immediately following the adjustment made
pursuant to this Section 11(n). If an event occurs which would require an
adjustment under both this Section 11(n) and Section 11(a)(ii) hereof, the
adjustment provided for in this Section 11(n) shall be in addition to, and
shall
be made prior to, any adjustment required pursuant to Section 11(a)(ii) hereof.
12. Certificate
of Adjusted Exercise Price or Number of Shares.
Whenever an adjustment is made as provided in Sections 11 and 13 hereof, the
Company shall promptly (a) prepare a certificate setting forth such adjustment
and a brief statement of the facts, computations and
methodology accounting for such adjustment, (b) file with the Rights Agent
and
with each
21
transfer
agent for the Preferred Shares a copy of such certificate and (c) mail a brief
summary thereof to each holder of a Rights Certificate in accordance with
Section 26 hereof. Notwithstanding the foregoing sentence, the failure of the
Company to make such certification or give such notice shall not affect the
validity of such adjustment or the force or effect of the requirement for such
adjustment. The Rights Agent shall be fully protected in relying on any such
certificate and on any adjustment or statement contained therein and shall
not
be deemed to have knowledge of such adjustment unless and until it shall have
received such certificate.
13. Consolidation,
Merger or Sale or Transfer of Assets or Earning Power.
(a) In
the
event that, following a Triggering Event, directly or indirectly:
(i)
the
Company shall consolidate with, or merge with and into, any other Person (other
than a wholly-owned Subsidiary of the Company in a transaction the principal
purpose of which is to change the state of incorporation of the Company and
which complies with Section 11(m) hereof);
(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
consolidation or merger and, in connection with such merger, all or part of
the
shares of Common Stock shall be changed into or exchanged for stock or other
securities of any other person (or the Company); 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 50% or more of the assets or earning power of the
Company and its Subsidiaries (taken as a whole) to any other Person or Persons
(other than the Company or one or more of its wholly owned Subsidiaries in
one
or more transactions, each of which individually (and together) complies with
Section 11(m) hereof),
then,
concurrent with and in each such case:
(a) each
holder of a Right (except as provided in Section 7(e) hereof) shall thereafter
have the right to receive, upon the exercise thereof, at a price equal to the
Total Exercise Price applicable immediately prior to the occurrence of the
Section 13 Event in accordance with the terms of this Agreement, such number
of
validly authorized and issued, fully paid, nonassessable and freely tradeable
shares of Common Stock of the Principal Party (as hereinafter defined), free
of
any liens, encumbrances, rights of first refusal or other adverse claims, as
shall be equal to the result obtained by dividing such Total Exercise Price
by
50% of the Current Per Share Market Price of the shares of Common
Stock of such Principal Party on the date of consummation of such Section 13
Event, provided,
22
however,
that
the Exercise Price and the number of shares of Common Stock of such Principal
Party so receivable upon exercise of a Right shall be subject to further
adjustment as appropriate in accordance with Section 11(e) hereof;
(b) such
Principal Party shall thereafter be liable for, and shall assume, by virtue
of
such Section 13 Event, all the obligations and duties of the Company pursuant
to
this Agreement;
(c) the
term
“Company” shall thereafter be deemed to refer to such Principal Party, it being
specifically intended that the provisions of Section 11 hereof shall apply
only
to such Principal Party following the first occurrence of a Section 13 Event;
(d) such
Principal Party shall take such steps (including, but not limited to, the
reservation of a sufficient number of its Common Stock) in connection with
the
consummation of any such transaction as may be necessary to ensure that the
provisions hereof shall thereafter be applicable, as nearly as reasonably may
be, in relation to its shares of Common Stock thereafter deliverable upon the
exercise of the Rights; and
(e) upon
the
subsequent occurrence of any consolidation, merger, sale or transfer of assets
or other extraordinary transaction in respect of such Principal Party, each
holder of a Right shall thereupon be entitled to receive, upon exercise of
a
Right and payment of the Total Exercise Price as provided in this Section 13(a),
such cash, shares, rights, warrants and other property which such holder would
have been entitled to receive had such holder, at the time of such transaction,
owned the shares of Common Stock of the Principal Party receivable upon the
exercise of such Right pursuant to this Section 13(a), and such Principal Party
shall take such steps (including, but not limited to, reservation of shares
of
stock) as may be necessary to permit the subsequent exercise of the Rights
in
accordance with the terms hereof for such cash, shares, rights, warrants and
other property.
(f) For
purposes hereof, the “earning power” of the Company and its Subsidiaries shall
be determined in good faith
by
the Company’s Board of Directors on the basis of the operating earnings of each
business operated by the
23
Company
and its Subsidiaries during the three fiscal years preceding the date of such
determination (or, in the case of any business not operated by the Company
or
any Subsidiary during three full fiscal years preceding such date, during the
period such business was operated by the Company or any Subsidiary).
(b) For
purposes of this Agreement, the term “Principal
Party”
shall
mean:
(i)
in
the case of any transaction described in clause (i) or (ii) of Section 13(a)
hereof: (A) the Person that is the issuer of the securities into which the
shares of Common Stock are converted in such merger or consolidation, or, if
there is more than one such issuer, the issuer the shares of Common Stock of
which have the greatest aggregate market value of shares outstanding, or (B)
if
no securities are so issued, (x) the Person that is the other party to the
merger, if such Person survives said merger, or, if there is more than one
such
Person, the Person the shares of Common Stock of which have the greatest
aggregate market value of shares outstanding or (y) if the Person that is the
other party to the merger does not survive the merger, the Person that does
survive the merger (including the Company if it survives) or (z) the Person
resulting from the consolidation; and
(ii)
in
the case of any transaction described in clause (iii) of Section13(a) hereof,
the Person that is the party receiving the greatest portion of the assets or
earning power transferred pursuant to such transaction or transactions, or,
if
more than one Person that is a party to such transaction or transactions
receives the same portion of the assets or earning power so transferred and
each
such portion would, were it not for the other equal portions, constitute the
greatest portion of the assets or earning power so transferred, or if the Person
receiving the greatest portion of the assets or earning power cannot be
determined, whichever of such Persons is the issuer of shares of Common Stock
having the greatest aggregate market value of shares outstanding; provided,
however,
that in
any such case described in the foregoing clause (b)(i) or (b)(ii), if the shares
of Common Stock of such Person are not at such time or have not been
continuously over the preceding 12-month period registered under Section 12
of
the Exchange Act, then (1) if such Person is a direct or indirect Subsidiary
of
another Person the shares of Common Stock of which are and have been so
registered, the term “Principal Party” shall refer to such other Person, or (2)
if such Person is a Subsidiary, directly or indirectly, of more than one Person,
the Common Stock of which are and have been so registered, the term “Principal
Party” shall refer to whichever of such Persons is the issuer of shares of
Common Stock having the greatest aggregate market value of shares outstanding,
or (3) if such Person is owned, directly or indirectly, by a joint venture
formed by two or more Persons that are not owned, directly or indirectly by
the
same Person, the rules set forth in clauses (1) and (2) above shall apply to
each of the owners having an interest in the venture as if the Person owned
by
the joint venture was a Subsidiary of both or all of such joint venturers,
and
the
Principal Party in each such case shall bear the obligations set forth in this
Section 13 in the same ratio as its interest in such Person bears to the total
of such interests.
24
(c) The
Company shall not consummate any Section 13 Event unless the Principal Party
shall have a sufficient number of authorized shares of Common Stock that have
not been issued or reserved for issuance to permit the exercise in full of
the
Rights in accordance with this Section 13 and unless prior thereto the Company
and such issuer shall have executed and delivered to the Rights Agent a
supplemental agreement confirming that such Principal Party shall, upon
consummation of such Section 13 Event, assume this Agreement in accordance
with
Sections 13(a) and 13(b) hereof, that all rights of first refusal or preemptive
rights in respect of the issuance of shares of Common Stock of such Principal
Party upon exercise of outstanding Rights have been waived, that there are
no
rights, warrants, instruments or securities outstanding or any agreements or
arrangements which, as a result of the consummation of such transaction, would
eliminate or substantially diminish the benefits intended to be afforded by
the
Rights and that such transaction shall not result in a default by such Principal
Party under this Agreement, and further providing that, as soon as practicable
after the date of such Section 13 Event, such Principal Party will:
(i)
prepare and file a registration statement under the Securities Act with respect
to the Rights and the securities purchasable upon exercise of the Rights on
an
appropriate form, use its best efforts to cause such registration statement
to
become effective as soon as practicable after such filing and use its best
efforts to cause such registration statement to remain effective (with a
prospectus at all times meeting the requirements of the Securities Act) until
the Expiration Date, and 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 or to meet the eligibility requirements for quotation on Nasdaq and
list (or continue the listing of) the Rights and the securities purchasable
upon
exercise of the Rights on Nasdaq; and
(iii)
deliver to holders of the Rights historical financial statements for such
Principal Party which comply in all respects with the requirements for
registration on Form F-1 (or any successor form) under the Exchange Act.
In
the
event that at any time after the occurrence of a Triggering Event some or all
of
the Rights shall not have been exercised at the time of a transaction described
in this Section 13, the Rights which have not theretofore been exercised shall
thereafter be exercisable in the manner described in Section 13(a) (without
taking into account any prior adjustment required by Section 11(a)(ii)).
(d) In
case
the “Principal Party” for purposes of Section 13(b) hereof has provision in any
of its authorized securities or in its certificate of incorporation or by-laws
or other instrument governing its corporate affairs, which provision would have
the effect of (i) causing such Principal Party to issue (other than to holders
of Rights pursuant to Section 13 hereof), in connection with, or as a
consequence of, the consummation of a Section 13 Event, shares
of
Common Stock or Equivalent Shares of such Principal Party at less than the
then
Current Per Share Market Price thereof or securities exercisable for, or
convertible into, shares of Common Stock or Equivalent Shares of such Principal
Party at less than such then
25
Current
Per Share Market Price, or (ii) providing for any special payment, tax or
similar provision in connection with the issuance of the shares of Common Stock
of such Principal Party pursuant to the provisions of Section 13 hereof, then,
in such event, the Company hereby agrees with each holder of Rights that it
shall not consummate any such transaction unless prior thereto the Company
and
such Principal Party shall have executed and delivered to the Rights Agent
a
supplemental agreement providing that the provision in question of such
Principal Party shall have been canceled, waived or amended, or that the
authorized securities shall be redeemed, so that the applicable provision will
have no effect in connection with or as a consequence of, the consummation
of
the proposed transaction.
(e) The
Company covenants and agrees that it shall not, at any time after the
Distribution Date, effect or permit to occur any Section 13 Event, if (i) at
the
time or immediately after such Section 13 Event there are any rights, warrants
or other instruments or securities outstanding or agreements in effect which
would substantially diminish or otherwise eliminate the benefits intended to
be
afforded by the Rights, (ii) prior to, simultaneously with or immediately after
such Section 13 Event, the Shareholders of the Person who constitutes, or would
constitute, the “Principal Party” for purposes of Section 13(b) hereof shall
have received a distribution of Rights previously owned by such Person or any
of
its Affiliates or Associates or (iii) the form or nature of organization of
the
Principal Party would preclude or limit the exercisability of the Rights.
(f) The
provisions of this Section 13 shall similarly apply to successive mergers or
consolidations or sales or other transfers.
14. Fractional
Rights and Fractional Shares.
(a) The
Company shall not be required to issue fractions of Rights or to distribute
Rights Certificates which evidence fractional Rights. In lieu of such fractional
Rights, there shall be paid to the registered holders of the Rights Certificates
with regard to which such fractional Rights would otherwise be issuable, an
amount in cash equal to the same fraction of the current market value of a
whole
Right. For 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, as determined pursuant to this Agreement.
(b) The
Company shall not be required to issue fractions of Preferred Shares (other
than
fractions that are integral multiples of one one-thousandth of a Preferred
Share) upon exercise of the Rights or to distribute certificates which evidence
fractional Preferred Shares (other than fractions that are integral multiples
of
one one-thousandth of a Preferred Share). Interests in fractions of Preferred
Shares in integral multiples of one one-thousandth of a Preferred Share may,
at
the election of the Company, be evidenced by depositary receipts, pursuant
to an
appropriate agreement between the Company and a depositary selected by it;
provided, that such agreement shall provide that the holders of such depositary
receipts shall have all the rights, privileges and preferences to which they
are
entitled as beneficial owners of the
Preferred Shares represented by such depositary receipts. In lieu of fractional
Preferred
26
Shares
that are not integral multiples of one one-thousandth of a Preferred Share,
the
Company shall pay to the registered holders of Rights Certificates at the time
such Rights are exercised as herein provided an amount in cash equal to the
same
fraction of the current market value of a Preferred Share. For purposes of
this
Section 14(b), the current market value of a Preferred Share shall be one
thousand times the closing price of a share of Common Stock (as determined
pursuant to the terms hereof) for the Trading Day immediately prior to the
date
of such exercise.
(c) 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 upon
the exercise or exchange of Rights. In lieu of such fractional shares of Common
Stock, the Company shall pay to the registered holders of Rights Certificates
at
the time such Rights are exercised as herein provided an amount in cash equal
to
the same fraction of the current market value of a share of Common Stock. For
purposes of this Section 14(c), 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 terms hereof) for the Trading Day immediately prior to the
date
of such exercise.
(d) The
holder of a Right by the acceptance of the Right expressly waives his or her
right to receive any fractional Rights or any fractional shares (other than
fractions that are integral multiples of one one-thousandth of a Preferred
Share) upon exercise of a Right.
15. Rights
of Action.
All
rights of action in respect of this Agreement, excepting the rights of action
given to the Rights Agent under Section 18 and Section 20 hereof, are vested
in
the respective registered holders of the Rights Certificates (and, prior to
the
Distribution Date, the registered holders of the shares of Common Stock); and
any registered holder of any Rights Certificate (or, prior to the Distribution
Date, of the shares of Common Stock), without the consent of the Rights Agent
or
of the holder of any other Rights Certificate (or, prior to the Distribution
Date, of the shares of Common Stock), may, in his or her own behalf and for
his
or her own benefit, enforce, and may institute and maintain any suit, action
or
proceeding against the Company to enforce, or otherwise act in respect of,
his
or her right to exercise the Rights evidenced by such Rights Certificate in
the
manner provided in such Rights Certificate and in this Agreement. Without
limiting the foregoing or any remedies available to the holders of Rights,
it is
specifically acknowledged that the holders of Rights would not have an adequate
remedy at law for any breach of this Agreement and 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. Notwithstanding anything in this Agreement to the contrary, neither
the Company nor the Rights Agent shall have any liability to any holder of
a
Right or other Person as a result of its inability to perform any of its
obligations under this Agreement by reason of any preliminary or permanent
injunction or other order, judgment, decree or ruling (whether interlocutory
or
final) issued by a court or by a governmental, regulatory, self-regulatory
or
administrative agency or commission, or any statute, rule, regulation or
executive order promulgated or enacted by any governmental authority,
prohibiting or otherwise restraining performance of such obligation; provided,
however, that the Company must use all reasonable efforts to have any such
injunction, order, judgment, decree or ruling lifted or otherwise overturned
as
soon as possible.
27
16. Agreement
of Rights Holders.
Every
holder of a Right, by accepting the same, consents and agrees with the Company
and the Rights Agent and with every other holder of a Right that:
(a) prior
to
the Distribution Date, the Rights will be transferable only in connection with
the transfer of the shares of Common Stock;
(b) after
the
Distribution Date, the Rights Certificates are transferable only on the registry
books of the Rights Agent if surrendered at the principal office or offices
of
the Rights Agent designated for such purposes, duly endorsed or accompanied
by a
proper instrument of transfer and with the appropriate forms and certificates
fully executed; and
(c) subject
to Sections 6(a) and 7(f) hereof, the Company and the Rights Agent may deem
and
treat the person in whose name the Rights Certificate (or, prior to the
Distribution Date, the associated Common Stock certificate) is registered as
the
absolute owner thereof and of the Rights evidenced thereby (notwithstanding
any
notations of ownership or writing on the Rights Certificates or the associated
Common Stock certificate made by anyone other than the Company or the Rights
Agent) for all purposes whatsoever, and neither the Company nor the Rights
Agent
shall be affected by any notice to the contrary.
17. Rights
Certificate Holder Not Deemed a Shareholder.
No
holder, as such, of any Rights Certificate shall be entitled to vote, receive
dividends or be deemed for any purpose to be the holder of the Preferred Shares
or any other securities of the Company which may at any time be issuable on
the
exercise of the Rights represented thereby, nor shall anything contained herein
or in any Rights Certificate be construed to confer upon the holder of any
Rights Certificate, as such, any of the rights of a Shareholder of the Company
or any right to vote for the election of directors or upon any matter submitted
to Shareholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
Shareholders (except as provided in Section 25 hereof), or to receive dividends
or subscription rights, or otherwise, until the Right or Rights evidenced by
such Rights Certificate shall have been exercised in accordance with the
provisions hereof.
18. The
Rights Agent.
(a) The
Company agrees to pay to the Rights Agent reasonable compensation for all
services rendered by it hereunder and, from time to time, on demand of the
Rights Agent, its reasonable expenses and counsel fees and other disbursements
incurred in the preparation, delivery, amendment, administration and execution
of this Agreement and the exercise and performance of its duties hereunder.
The
Company also agrees to indemnify the Rights Agent for, and to hold it harmless
against, any loss, liability, damage, judgment, fine, penalty, claim, demand,
settlement, cost or expense (including, without limitation, the reasonable
fees
and expenses of legal counsel), incurred without gross negligence, bad faith
or
willful misconduct on the part of the Rights Agent (which gross negligence,
bad
faith or willful misconduct must be determined by a final, non-appealable order,
judgment, decree or ruling of a court of competent jurisdiction), for anything
done, suffered or omitted by the Rights Agent in connection with the acceptance,
administration, exercise and performance of its duties under this Agreement.
The
28
costs
and
expenses incurred in enforcing this right of indemnification shall be paid
by
the Company. The provisions of this Section 18 and Section 20 below shall
survive the termination of this Agreement, the exercise or expiration of the
Rights and the resignation, replacement or removal of the Rights Agent. Anything
to the contrary notwithstanding, in no event will the Rights Agent be liable
for
special, punitive, indirect, incidental or consequential loss or damage of
any
kind whatsoever (including but not limited to lost profits), even if the Rights
Agent has been advised of the possibility of such loss or damage. Any liability
of the Rights Agent under this Agreement will be limited to the amount of annual
fees paid by the Company to the Rights Agent.
(b) The
Rights Agent shall be authorized and protected and shall incur no liability
for,
or in respect of any action taken, suffered or omitted by it in connection
with,
its acceptance and administration of this Agreement and the exercise and
performance of its duties hereunder, in reliance upon any Rights Certificate
or
certificate for the Preferred Shares or 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 or acknowledged,
by
the proper Person or Persons, or otherwise upon the advice of counsel as set
forth in Section 20 hereof.
19. Merger
or Consolidation or Change of Name of Rights Agent.
Any
Person into which the Rights Agent or any successor Rights Agent may be merged
or with which it may be consolidated, or any Person resulting from any merger
or
consolidation to which the Rights Agent or any successor Rights Agent shall
be a
party, or any Person succeeding to the 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,
however,
that
such Person would be eligible for appointment as a successor Rights Agent under
the provisions of Section 21 hereof. In case at the time such successor Rights
Agent shall succeed to the agency created by this Agreement, any of the Rights
Certificates shall have been countersigned but not delivered, any such successor
Rights Agent may adopt the countersignature of the predecessor Rights Agent
and
deliver such Rights Certificates so countersigned; and in case at that time
any
of the Rights Certificates shall not have been countersigned, any successor
Rights Agent may countersign such Rights Certificates either in the name of
the
predecessor Rights Agent or in the name of the successor Rights Agent; and
in
all such cases such Rights Certificates shall have the full force provided
in
the Rights Certificates and in this Agreement. In case at any time the name
of
the Rights Agent shall be changed and at such time any of the Rights
Certificates shall have been countersigned but not delivered, the Rights Agent
may adopt the countersignature under its prior name and deliver Rights
Certificates so countersigned; and in case at that time any of the Rights
Certificates shall not have been countersigned, the Rights Agent may countersign
such Rights Certificates either in its prior name or in its changed name; and
in
all such cases such Rights Certificates shall have the full force provided
in
the Rights Certificates and in this Agreement.
20. Duties
of Rights Agent.
The
Rights Agent undertakes to perform only the duties and obligations expressly
imposed by this Agreement (and no implied duties) upon the following terms
and
conditions, by all of which the Company and the holders of Rights Certificates,
by their acceptance thereof, shall be bound:
29
(a)
The
Rights Agent may consult with legal counsel (who may be legal counsel for the
Company or an employee of the Rights Agent), and the advice or opinion of such
counsel shall be full and complete authorization and protection to the Rights
Agent and the Rights Agent shall incur no liability for or in respect of any
action taken, suffered or omitted by it and in accordance with such advice
or
opinion.
(b) Whenever
in the performance of its duties under this Agreement the Rights Agent shall
deem it necessary or desirable that any fact or matter (including, without
limitation, the identity of any Acquiring Person and the determination of
Current Per Share Market Price) be proved or established by the Company prior
to
taking, suffering or omitting to take 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 Chief Executive Officer, the
President, any Vice President, the Chief Financial Officer, the Secretary or
any
Assistant Secretary of the Company and delivered to the Rights Agent; and such
certificate shall be full and complete authorization and protection to the
Rights Agent and the Rights Agent shall incur no liability for or in respect
of
any action taken, suffered or omitted 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 (which gross
negligence, bad faith or willful misconduct must be determined by a final,
non-appealable order, judgment, decree or ruling of a court of competent
jurisdiction).
(c) The
Rights Agent shall not be liable for or by reason of any of the statements
of
fact or recitals contained in this Agreement or in the Rights Certificates
(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.
(d) The
Rights Agent shall not have any liability for or be under any responsibility
in
respect of the validity of this Agreement or the execution and delivery hereof
(except the due execution hereof by the Rights Agent) or in respect of the
validity or execution of any Rights Certificate (except its countersignature
thereof); nor shall it be responsible for any breach by the Company of any
covenant or condition contained in this Agreement or in any Rights Certificate;
nor shall it be responsible for any change in the exercisability of the Rights
or any adjustment in the terms of the Rights (including the manner, method
or
amount thereof) provided for in Sections 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 Rights
Certificates after receipt by the Rights Agent of a certificate furnished
pursuant to Section 12 describing such change or adjustment upon which the
Rights Agent may rely); nor shall it by any act hereunder be deemed to make
any
representation or warranty as to the authorization or reservation of any
Preferred Shares to be issued pursuant to this Agreement or any Rights
Certificate or as to whether any Preferred Shares will, when issued, be validly
authorized and issued, fully paid and nonassessable.
(e) The
Company agrees that it will perform, execute, acknowledge and deliver or cause
to be performed, executed, acknowledged and delivered all such further
and
(f) 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.
30
(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 Chief Executive Officer, the President, any Vice President,
the Chief Financial Officer, the Secretary or any Assistant Secretary of the
Company, and to apply to such officers for advice or instructions in connection
with its duties, and such instructions shall be full authorization and
protection to the Rights Agent and the Rights Agent shall not be liable for
or
in respect of any action taken, suffered or omitted by it in accordance with
instructions of any such officer or for any delay in acting while waiting for
those instructions. The Rights Agent shall be fully authorized and protected
in
relying upon the most recent instructions received by any such officer. Any
application by the Rights Agent for written instructions from the Company may,
at the option of the Rights Agent, set forth in writing any action proposed
to
be taken, suffered omitted by the Rights Agent under this Rights Agreement
and
the date on and/or after which such action shall be taken or suffered or such
omission shall be effective. The Rights Agent shall not be liable for any action
taken or suffered by, or omission of, the Rights Agent in accordance with a
proposal included in any such application on or after the date specified in
such
application (which date shall not be less than five (5) Business Days after
the
date any officer of the Company actually receives such application, unless
any
such officer shall have consented in writing to an earlier date) unless, prior
to taking any such action (or the effective date in the case of an omission),
the Rights Agent shall have received written instructions in response to such
application specifying the action to be taken or omitted.
(h) The
Rights Agent and any shareholder, affiliate, director, officer or employee
of
the Rights Agent may buy, sell or deal in any of the Rights or other securities
of the Company or become pecuniarily interested in any transaction in which
the
Company may be interested, or contract with or lend money to the Company or
otherwise act as fully and freely as though it were not Rights Agent under
this
Agreement. Nothing herein shall preclude the Rights Agent or any such
shareholder, affiliate, director, officer or employee from acting in any other
capacity for the Company or for any other Person.
(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 (through its directors,
officers and employees) 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 or
any
other Person resulting from any such act, default, neglect or misconduct, absent
gross negligence, bad faith or willful misconduct in the selection and continued
employment thereof (which gross negligence, bad faith or willful misconduct
must
be determined by a final, non-appealable order, judgment, decree or ruling
of a
court of competent jurisdiction.
(j) No
provision of this Agreement shall require the Rights Agent to expend or risk
its
own funds or otherwise incur any financial liability in the performance of
any
of its duties hereunder or in the exercise of its rights if there shall be
reasonable grounds for believing that
repayment of such funds or adequate indemnification against such risk or
liability is not reasonably assured to it.
31
(k) If,
with
respect to any Rights Certificate surrendered to the Rights Agent for exercise
or transfer, the certificate attached to the form of assignment or form of
election to purchase, as the case may be, has either not been completed or
indicates an affirmative response to clause 1 and/or 2 thereof, the Rights
Agent
shall not take any further action with respect to such requested exercise or
transfer without first consulting with the Company.
21. Change
of Rights Agent.
The
Rights Agent or any successor Rights Agent may resign and be discharged from
its
duties under this Agreement upon thirty (30) days’ written notice mailed to the
Company and to each transfer agent of the Preferred Shares and the Common Stock
by registered or certified mail, and to the holders of the Rights Certificates
by first-class mail. The Company may remove the Rights Agent or any successor
Rights Agent upon thirty (30) days’ written notice, mailed to the Rights Agent
or successor Rights Agent, as the case may be, and to each transfer agent of
the
Preferred Shares and the Common Stock by registered or certified mail, and
to
the holders of the Rights Certificates by first-class mail. If the Rights Agent
shall resign or be removed or shall otherwise become incapable of acting, the
Company shall appoint a successor to the Rights Agent. If the Company shall
fail
to make such appointment within a period of thirty (30) days after giving notice
of such removal or after receiving written notice of such resignation or
incapacity by the resigning or incapacitated Rights Agent or by the holder
of a
Rights Certificate (who shall, with such notice, submit his or her Rights
Certificate for inspection by the Company), then the registered holder of any
Rights Certificate may apply to any court of competent jurisdiction for the
appointment of a new Rights Agent. Any successor Rights Agent, whether appointed
by the Company or by such a court, shall be a Person organized and doing
business under the laws of the United States or of any state of the United
States, in good standing, which is authorized under such laws to exercise stock
transfer powers and is subject to supervision or examination by federal or
state
authority and which has at the time of its appointment as Rights Agent a
combined capital and surplus of at least $50 million or an Affiliate of such
a
Person. After appointment, the successor Rights Agent shall be vested with
the
same powers, rights, duties and responsibilities as if it had been originally
named as Rights Agent without further act or deed; but the predecessor Rights
Agent shall deliver and transfer to the successor Rights Agent any property
at
the time held by it hereunder, and execute and deliver any further assurance,
conveyance, act or deed necessary for the purpose. Not later than the effective
date of any such appointment, the Company shall file notice thereof in writing
with the predecessor Rights Agent and each transfer agent of the Preferred
Shares and the Common Stock, and mail a written notice thereof to the registered
holders of the Rights Certificates. Failure to give any notice provided for
in
this Section 21, however, or any defect therein, shall not affect the legality
or validity of the resignation or removal of the Rights Agent or the appointment
of the successor Rights Agent, as the case may be.
22. Issuance
of New Rights Certificates.
Notwithstanding any of the provisions of this Agreement or of the Rights to
the
contrary, the Company may, at its option, issue new Rights Certificates
evidencing Rights in such form as may be approved by its Board of Directors
to
reflect any adjustment or change in the Exercise Price and the number or kind
or
class of shares or other securities or property purchasable under the Rights
Certificates made in accordance
with the provisions of this Agreement. In addition, in connection with the
issuance or sale of shares of Common Stock following the Distribution Date
and
prior to the redemption or expiration of the Rights, the Company (a) shall,
with
respect to shares of Common Stock so
32
issued
or
sold pursuant to the exercise of stock options or under any employee plan or
arrangement or upon the exercise, conversion or exchange of other securities
of
the Company outstanding at the date hereof or upon the exercise, conversion
or
exchange of securities hereinafter issued by the Company and (b) may, in any
other case, if deemed necessary or appropriate by the Board of Directors of
the
Company, issue Rights Certificates representing the appropriate number of Rights
in connection with such issuance or sale; provided,
however,
that
(i) no such Rights Certificate shall be issued and this sentence shall be null
and void ab initio if, and to the extent that, such issuance or this sentence
would create a significant risk of or result in material adverse tax
consequences to the Company or the Person to whom such Rights Certificate would
be issued or would create a significant risk of or result in such options’ or
employee plans’ or arrangements’ failing to qualify for otherwise available
special tax treatment and (ii) no such Rights Certificate shall be issued if,
and to the extent that, appropriate adjustment shall otherwise have been made
in
lieu of the issuance thereof.
23. Redemption.
(a) The
Company may, at its option and with the approval of the Board of Directors,
at
any time prior to the Close of Business on the earlier of (i) the Shares
Acquisition Date and (ii) the Final Expiration Date, redeem all but not less
than all the then outstanding Rights at a redemption price of $0.01 per Right,
appropriately adjusted to reflect any stock split, stock dividend or similar
transaction occurring after the date hereof (such redemption price being herein
referred to as the “Redemption
Price”)
and
the Company may, at its option, pay the Redemption Price either in shares of
Common Stock (based on the Current Per Share Market Price thereof at the time
of
redemption) or cash. Such redemption of the Rights by the Company may be made
effective at such time, on such basis and with such conditions as the Board
of
Directors in its sole discretion may establish. The date on which the Board
of
Directors elects to make the redemption effective shall be referred to as the
“Redemption
Date”.
(b) Immediately
upon the action of the Board of Directors of the Company ordering the redemption
of the Rights, evidence of which shall have been filed with the Rights Agent,
and without any further action and without any notice, the right to exercise
the
Rights will terminate and the only right thereafter of the holders of Rights
shall be to receive the Redemption Price. The Company shall promptly give public
notice of any such redemption; provided,
however,
that
the failure to give or any defect in, any such notice shall not affect the
validity of such redemption. Within ten (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 Rights Agent and 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.
33
24. Exchange.
(a) Subject
to applicable laws, rules and regulations, and subject to subsection 24(c)
below, the Company may, at its option, by action of the Board of Directors,
at
any time after the occurrence of a Triggering Event, exchange all or part of
the
then outstanding and exercisable Rights (which shall not include Rights that
have become void pursuant to the provisions of Section 7(e) hereof) for shares
of Common Stock at an exchange ratio of one share of Common Stock per Right,
appropriately adjusted to reflect any stock split, stock dividend or similar
transaction occurring after the date hereof (such exchange ratio being
hereinafter referred to as the “Exchange
Ratio”).
Notwithstanding the foregoing, the Board of Directors shall not be empowered
to
effect such exchange at any time after any Person (other than the Company,
any
Subsidiary of the Company, any employee benefit plan of the Company or any
such
Subsidiary, or any entity holding 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 Common Stock then
outstanding.
(b) Immediately
upon the action of the Board of Directors ordering the exchange of any Rights
pursuant to subsection 24(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 give public notice
of
any such exchange (with prompt written notice thereof to the Rights Agent);
provided,
however,
that
the failure to give, or any defect in, such notice shall not affect the validity
of such exchange. The Company shall mail a notice of any such exchange 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 the shares of Common Stock for Rights will be effected and, in the event
of
any partial exchange, the number of Rights which will be exchanged. Any partial
exchange shall be effected pro rata based on the number of Rights (other than
Rights which have become void pursuant to the provisions of Section 7(e) hereof)
held by each holder of Rights.
(c) In
the
event that there shall not be sufficient shares of Common Stock issued but
not
outstanding or authorized but unissued to permit any exchange of Rights as
contemplated in accordance with Section 24(a), the Company shall either take
such action as may be necessary to authorize additional shares of Common Stock
for issuance upon exchange of the Rights or alternatively, at the option of
a
majority of the Board of Directors, with respect to each Right (i) pay cash
in
an amount equal to the Current Value (as hereinafter defined), in lieu of
issuing shares of Common Stock in exchange therefor, or (ii) issue debt or
equity securities or a combination thereof, having a value equal to the Current
Value, in lieu of issuing shares of Common Stock in exchange for each such
Right, where the value of such securities shall be determined by a nationally
recognized investment banking firm selected by majority vote of the Board of
Directors, or (iii) deliver any combination of cash, property, shares of
Common
Stock and/or other securities having a value equal to the Current Value in
exchange for each Right. For purposes of this Section 24(c) only, the Current
Value shall mean the product of the Current Per Share Market Price of shares
of
Common Stock on the date of the occurrence of the event described above in
subparagraph (a), multiplied by the number of shares of Common
34
Stock
for
which the Right otherwise would be exchangeable if there were sufficient shares
available. To the extent that the Company determines that some action need
be
taken pursuant to clauses (i), (ii) or (iii) of this Section 24(c), the Board
of
Directors may temporarily suspend the exercisability of the Rights for a period
of up to sixty (60) days following the date on which the event described in
Section 24(a) shall have occurred, in order to seek any authorization of
additional shares of Common Stock and/or to decide the appropriate form of
distribution to be made pursuant to the above provision and to determine the
value thereof. In the event of any such suspension, the Company shall issue
a
public announcement stating that the exercisability of the Rights has been
temporarily suspended (with prompt written notice thereof to the Rights
Agent).
(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 of Common Stock, there shall be paid to the
registered holders of the Rights Certificates with regard to which such
fractional shares of Common Stock 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 (as determined pursuant to the terms hereof).
(e) The
Company may, at its option, by majority vote of the Board of Directors, at
any
time before any Person has become an Acquiring Person, exchange all or part
of
the then outstanding Rights for rights of substantially equivalent value, as
determined reasonably and with good faith by the Board of Directors, based
upon
the advice of one or more nationally recognized investment banking firms.
(f) Immediately
upon the action of the Board of Directors ordering the exchange of any Rights
pursuant to subsection 24(e) 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 rights in exchange therefor as has been determined by the Board of
Directors in accordance with subsection 24(e) above. The Company shall give
public notice of any such exchange (with prompt written notice thereof to the
Rights Agent); provided,
however,
that
the failure to give, or any defect in, such notice shall not affect the validity
of such exchange. The Company shall mail a notice of any such exchange to all
of
the holders of such Rights at their last addresses as they appear upon the
registry books of the transfer agent for the shares of Common Stock of the
Company. 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 the Rights will be
effected.
25. Notice
of Certain Events.
(a) In
case
the Company shall propose to effect or permit to occur any Triggering Event
or
Section 13 Event, the Company shall give notice thereof to each holder of Rights
and the Rights Agent in accordance with Section 26 hereof at least twenty (20)
days prior to
occurrence of such Triggering Event or such Section 13 Event which shall specify
the expected date for such Triggering Event or such Section 13 Event for
purposes of such event.
35
(b) In
case
any Triggering Event or Section 13 Event shall occur, then, in any such case,
the Company shall as soon as practicable thereafter give to each holder of
a
Rights Certificate and the Rights Agent, in accordance with Section 26 hereof,
a
notice of the occurrence of such event, which shall specify the date of such
Triggering Event or Section 13 Event, event and the consequences of the event
to
holders of Rights under Sections 11(a)(ii) and 13 hereof.
26. Notices.
Notices
or demands authorized by this Agreement to be given or made by the Rights Agent
or by the holder of any Rights Certificate to or on the Company shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed (until another address is filed in writing with the Rights Agent)
as
follows:
Genco
Shipping & Trading Limited
00
Xxxx
00xx
Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Xxxxxx Xxxxxx Xxxxxxxx or Xxxx X. Xxxxxxxxxx
with
a
copy to:
Xxxxxx
Xxxxx Xxxxxxxx & Xxxxxxx LLP
0000
Xxxxxx xx xxx
Xxxxxxxx
Xxx
Xxxx, XX
00000
Attention:
Xxxxxx X.
Xxxxxx
Subject
to the provisions of Section 21 hereof, any notice or demand authorized by
this
Agreement to be given or made by the Company or by the holder of any Rights
Certificate to or on the Rights Agent shall be sufficiently given or made if
sent by first-class mail, postage prepaid, addressed (until another address
is
filed in writing with the Company) as follows:
Mellon
Investor Services LLC
Newport
Office Center
VII
000
Xxxxxxxxxx Xxxx.
Xxxxxx
Xxxx, Xxx Xxxxxx
00000
Attn: Relationship Manager
Fax: (000) 000-0000
with a copy to:
Mellon
Investor Services LLC
Newport
Office Center VII
000
Xxxxxxxxxx Xxxx.
Xxxxxx
Xxxx, Xxx Xxxxxx 00000
Attention:
Legal Department
Fax:
(000) 000-0000
Notices
or demands authorized by this Agreement to be given or made by the Company
or
the Rights Agent to the holder of any Rights Certificate shall be sufficiently
given or made if sent by
36
first-class
mail, postage prepaid, addressed to such holder at the address of such holder
as
shown on the registry books of the Company.
27. Supplements
and Amendments.
Prior
to the occurrence of a Distribution Date, the Company may supplement or amend
this Agreement in any respect without the approval of any holders of Rights
and
the Rights Agent shall, if the Company so directs, execute such supplement
or
amendment. From and after the occurrence of a Distribution Date, the Company
and
the Rights Agent may from time to time supplement or amend this Agreement
without the approval of any holders of Rights in order to (i) cure any
ambiguity, (ii) correct or supplement any provision contained herein which
may
be defective or inconsistent with any other provisions herein, (iii) shorten
or
lengthen any time period hereunder or (iv) to change or supplement the
provisions hereunder in any manner that the Company may deem necessary or
desirable and that shall not adversely affect the interests of the holders
of
Rights (other than an Acquiring Person or an Affiliate or Associate of an
Acquiring Person); provided, this Agreement may not be supplemented or amended
to lengthen, pursuant to clause (iii) of this sentence, (A) a time period
relating to when the Rights may be redeemed at such time as the Rights are
not
then redeemable or (B) any other time period unless such lengthening is for
the
purpose of protecting, enhancing or clarifying the rights of, and/or the
benefits to, the holders of Rights (other than an Acquiring Person or an
Affiliate or Associate of an Acquiring Person). Upon the delivery of a
certificate from an appropriate officer of the Company that states that the
proposed supplement or amendment is in compliance with the terms of this Section
27, the Rights Agent shall execute such supplement or amendment. Prior to the
Distribution Date, the interests of the holders of Rights shall be deemed
coincident with the interests of the holders of shares of Common Stock.
Notwithstanding anything contained in this Agreement to the contrary, the Rights
Agent may, but shall not be obligated to, enter into any supplement or amendment
that affects the Rights Agent’s own rights, duties, obligations or immunities
under this Agreement.
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.
29. Determinations
and Actions by the Board of Directors, etc.
For all
purposes of this Agreement, any calculation of the number of shares of Common
Stock outstanding at any particular time, including for purposes of determining
the particular percentage of such outstanding shares of Common Stock of which
any Person is the Beneficial Owner, shall be made in accordance with the last
sentence of Rule 13d-3(d)(1)(i) of the General Rules and Regulations under
the
Exchange Act. The Board of Directors of the Company shall have the exclusive
power and authority to administer this Agreement and to exercise all rights
and
powers specifically granted to the Board, or the Company, or as may be necessary
or advisable in the administration of this Agreement, including, without
limitation, the right and power to (i) interpret the provisions of this
Agreement and (ii) make all determinations deemed necessary or advisable for
the
administration of this Agreement (including a determination to redeem or not
redeem
the Rights or to amend the Agreement). All such actions, calculations,
interpretations and determinations (including, for purposes of clause (y) below,
all omissions with respect to the foregoing) which are done or made by the
Board
in good faith, shall (x) be final, conclusive and binding on the Company, the
Rights Agent, the holders of the Rights Certificates and all other parties
and
(y) not subject the Board to any liability to the holders of the Rights. The
Rights
37
Agent
is
entitled always to assume the Company’s Board of Directors acted in good faith
and shall be fully protected and incur no liability in reliance thereon.
30. Benefits
of this Agreement.
Nothing
in this Agreement shall be construed to give to any Person other than the
Company, the Rights Agent and the registered holders of the Rights Certificates
(and, prior to the Distribution Date, the shares of Common Stock) any legal
or
equitable right, remedy or claim under this Agreement; but this Agreement shall
be for the sole and exclusive benefit of the Company, the Rights Agent and
the
registered holders of the Rights Certificates (and, prior to the Distribution
Date, the shares of Common Stock).
31. Severability.
If any
term, provision, covenant or restriction of this Agreement is held by a court
of
competent jurisdiction or other authority to be invalid, void or unenforceable,
the remainder of the terms, provisions, covenants and restrictions of this
Agreement shall remain in full force and effect and shall in no way be affected,
impaired or invalidated; provided,
however,
that
notwithstanding anything in this Agreement to the contrary, if any such term,
provision, covenant or restriction is held by such court or authority to be
invalid, void or unenforceable and the Board of Directors of the Company
determines in its good faith judgment that severing the invalid language from
this Agreement would adversely affect the purpose or effect of this Agreement,
the right of redemption set forth in Section 23 hereof shall be reinstated
and
shall not expire until the Close of Business on the tenth day following the
date
of such determination by the Board of Directors.
32. Governing
Law.
This
Agreement and each Right and each Rights Certificate issued hereunder shall
be
deemed to be a contract made under the laws of New York and for all purposes
shall be governed by and construed in accordance with the laws of such
jurisdiction applicable to contracts to be made and performed entirely within
such jurisdiction.
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.
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.
[Signature
page follows]
38
IN
WITNESS WHEREOF, the parties have executed this Shareholders
Rights
Agreement as of the date first written above.
GENCO
SHIPPING & TRADING LIMITED
By:
/s/ Xxxxxx Xxxxxx
Xxxxxxxx
Name:
Xxxxxx Xxxxxx Xxxxxxxx
Title:
President
By:
/s/ Xxxx X.
Xxxxxxxxxx
Name:
Xxxx X. Xxxxxxxxxx
Title:
Secretary
MELLON
INVESTOR SERVICES LLC
By:
/s/ Xxxxxx
Xxxxxxxx
Name:
Xxxxxx Xxxxxxxx
Title:
Assistant Vice President
39
Exhibit
A
CERTIFICATE
OF DESIGNATIONS OF RIGHTS, PREFERENCES AND PRIVILEGES OF
SERIES
A
PREFERRED STOCK OF GENCO SHIPPING & TRADING LIMITED
The
undersigned, Xxxxxx Xxxxxx Xxxxxxxx and Xxxx X. Xxxxxxxxxx do hereby certify:
1. That
they
are the duly elected and acting President and Secretary, respectively, of Genco
Shipping & Trading Limited, a Xxxxxxxx Islands corporation (the
“Company”).
2. That
pursuant to the authority conferred by the Company’s Amended and Restated
Articles of Incorporation, the Company’s Board of Directors on ______, 200_
adopted the following resolution designating and prescribing the relative
rights, preferences and limitations of the Company’s Series A Preferred Stock:
RESOLVED,
that pursuant to the authority vested in the Board of Directors (the
“Board”)
of the
Company by the Articles of Incorporation, the Board does hereby establish a
series of preferred stock, par value $0.01 per share, and the designation and
certain powers, preferences and other special rights of the shares of such
series, and certain qualifications, limitations and restrictions thereon, are
hereby fixed as follows:
Section
1. Designation
and Amount.
The
shares of such series shall be designated as “Series
A Preferred Stock”.
The
Series
A Preferred Stock
shall
have a par value of $0.01 per share, and the number of shares constituting
such
series shall initially be 1,000,000, which number the Board may from time to
time increase or decrease (but not below the number then
outstanding).
Section
2. Proportional
Adjustment.
In the
event the Company shall at any time after the issuance of any share or shares
of
Series
A Preferred Stock
(i)
declare any dividend on the common stock of the Company par value $0.01 per
share (the “Common
Stock”)
payable in shares of Common Stock, (ii) subdivide the outstanding Common Stock
or (iii) combine the outstanding Common Stock into a smaller number of shares,
then in each such case the Company shall simultaneously effect a proportional
adjustment to the number of outstanding shares of Series
A Preferred Stock.
Section
3. Dividends
and Distributions.
(a) Subject
to the prior and superior right of the holders of any shares of any series of
preferred stock ranking prior and superior to the shares of Series
A Preferred Stock
with
respect to dividends, the holders of shares of Series
A Preferred Stock
shall be
entitled to receive when, as and if declared by the Board out of funds legally
available for the purpose, quarterly dividends payable in cash on the last
day
of February, May, August and November 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 A Preferred Stock, in an amount
per
share (rounded to the nearest cent) equal to 1,000 times the aggregate per
share
amount of all cash dividends, and 1,000 times the aggregate
A-1
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 A Preferred Stock.
(b) The
Company shall declare a dividend or distribution on the Series A Preferred
Stock
as provided in paragraph (a) above immediately after it declares a dividend
or
distribution on the Common Stock (other than a dividend payable in shares of
Common Stock).
(c) Dividends
shall begin to accrue on outstanding shares of Series A Preferred Stock from
the
Quarterly Dividend Payment Date immediately preceding the date of issue of
such
shares of Series A Preferred Stock, unless the date of issue of such shares
is
prior to the record date for the first Quarterly Dividend Payment Date, in
which
case dividends on such shares shall begin to accrue from the date of issue
of
such shares, or unless the date of issue is a Quarterly Dividend Payment Date
or
is a date after the record date for the determination of holders of shares
of
Series A 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 accrue from such Quarterly Dividend Payment Date. Accrued but
unpaid dividends shall not bear interest. Dividends paid on the shares of Series
A 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
may fix a record date for the determination of holders of shares of Series
A
Preferred Stock entitled to receive payment of a dividend or distribution
declared thereon, which record date shall be no more than 30 days prior to
the
date fixed for the payment thereof.
Section
4. Voting
Rights.
The
holders of shares of Series A Preferred Stock shall have the following voting
rights:
(a) Each
share of Series A Preferred Stock shall entitle the holder thereof to 1,000
votes on all matters submitted to a vote of the Shareholders of the Company.
(b) Except
as
otherwise provided herein or by law, the holders of shares of Series A Preferred
Stock and the holders of shares of Common Stock shall vote together as one
class
on all matters submitted to a vote of Shareholders of the Company.
(c) Except
as
required by law, holders of Series A 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
5. Certain
Restrictions.
(a) The
Company shall not declare any dividend on, make any distribution on, or redeem
or purchase or otherwise acquire for consideration any shares of Common Stock
after the first issuance of a share or fraction of a share of Series A Preferred
Stock unless concurrently therewith
it shall declare a dividend on the Series A Preferred Stock as required by
Section 3 hereof.
A-2
(b) Whenever
quarterly dividends or other dividends or distributions payable on the Series
A
Preferred Stock as provided in Section 3 are in arrears, thereafter and until
all accrued and unpaid dividends and distributions, whether or not declared,
on
shares of Series A Preferred Stock outstanding shall have been paid in full,
the
Company shall not (i) declare or pay dividends on, make any other distributions
on, or redeem or purchase or otherwise acquire for consideration any shares
of
stock ranking junior (either as to dividends or upon liquidation, dissolution
or
winding up) to the Series A Preferred Stock; (ii) declare or pay dividends
on,
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 Series
A
Preferred Stock, except dividends paid ratably on the Series A 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 on a parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series A Preferred Stock, provided that
the
Company may at any time redeem, purchase or otherwise acquire shares of any
such
parity stock in exchange for shares of any stock of the Company ranking junior
(either as to dividends or upon dissolution, liquidation or winding up) to
the
Series A Preferred Stock; (iv) purchase or otherwise acquire for consideration
any shares of Series A Preferred Stock, or any shares of stock ranking on a
parity with the Series A Preferred Stock, except in accordance with a purchase
offer made in writing or by publication (as determined by the Board) to all
holders of such shares upon such terms as the Board, 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.
(c) The
Company shall not permit any subsidiary of the Company to purchase or otherwise
acquire for consideration any shares of stock of the Company unless the Company
could, under paragraph (a) of this Section 5, purchase or otherwise acquire
such
shares at such time and in such manner.
Section
6. Reacquired
Shares.
Any
shares of Series A Preferred Stock purchased or otherwise acquired by the
Company in any manner whatsoever shall be retired and canceled promptly after
the acquisition thereof. All such shares shall upon their cancellation become
authorized but unissued shares of preferred stock and may be reissued as part
of
a new series of preferred stock to be created by resolution or resolutions
of
the Board, subject to the conditions and restrictions on issuance set forth
herein and, in the Articles of Incorporation, as then amended.
Section
7. Liquidation,
Dissolution or Winding Up.
Upon
any liquidation, dissolution or winding up of the Company , the holders of
shares of Series A Preferred Stock shall be entitled to receive an aggregate
amount per share equal to 1,000 times the aggregate amount to be distributed
per
share to holders of shares of Common Stock plus an amount equal to any accrued
and unpaid dividends on such shares of Series A Preferred Stock.
A-3
Section
8. Consolidation,
Merger, etc.
In case
the Company 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 A Preferred Stock shall at the same time be similarly
exchanged or changed in an amount per share equal to 1,000 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 share of Common Stock is
changed or exchanged.
Section
9. No
Redemption.
The
shares of Series A Preferred Stock shall not be redeemable.
Section
10. Ranking.
The
Series A Preferred Stock shall rank junior to all other series of the Company’s
preferred stock as to the payment of dividends and the distribution of assets,
unless the terms of any such series shall provide otherwise.
Section
11. Amendment.
The
Articles of Incorporation of the Company shall not be further amended in any
manner which would materially alter or change the powers, preference or special
rights of the Series A Preferred Stock so as to affect them adversely without
the affirmative vote of the holders of a majority of the outstanding shares
of
Series A Preferred Stock, voting separately as a class.
Section
12. Fractional
Shares.
Series
A Preferred Stock may be issued in fractions of a share which shall entitle
the
holder, in proportion to such holder’s fractional shares, to exercise voting
rights, receive dividends, participate in distributions and to have the benefit
of all other rights of holders of Series A Preferred Stock.
RESOLVED
FURTHER, that the President or any Vice President and the Secretary or any
Assistant Secretary of this Company be, and they hereby are, authorized and
directed to prepare and file a Certificate of Designation of Rights, Preferences
and Privileges in accordance with the foregoing resolution and the provisions
of
Xxxxxxxx Islands law and to take such actions as they may deem necessary or
appropriate to carry out the intent of the foregoing resolution.”
REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK
A-4
We
further declare under penalty of perjury that the matters set forth in the
foregoing Certificate of Designation are true and correct of our own knowledge.
|
________________________________
Xxxxxx
Xxxxxx Xxxxxxxx
President
|
|
|
________________________________
Xxxx
X. Xxxxxxxxxx
Secretary
|
A-5
Exhibit
B
[FORM
OF
RIGHTS CERTIFICATE]
No.
R- _________________Rights
NOT
EXERCISABLE AFTER THE EARLIER OF FEBRUARY
21, 2015 AND THE DATE ON WHICH THE RIGHTS EVIDENCED HEREBY ARE REDEEMED OR
EXCHANGED BY THE COMPANY AS SET FORTH IN THE RIGHTS AGREEMENT. AS SET FORTH
IN
THE RIGHTS AGREEMENT, RIGHTS ISSUED TO, OR HELD BY, ANY PERSON WHO IS, WAS
OR
BECOMES AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE THEREOF (AS SUCH TERMS
ARE DEFINED IN THE RIGHTS AGREEMENT), WHETHER CURRENTLY HELD BY OR ON BEHALF
OF
SUCH PERSON OR BY ANY SUBSEQUENT HOLDER, MAY BE NULL AND VOID. [THE RIGHTS
REPRESENTED BY THIS RIGHT CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON
WHO WAS OR BECAME AN ACQUIRING PERSON OR AN AFFILIATE OR AN ASSOCIATE OF AN
ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT). THIS
RIGHT
CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY BE OR MAY BECOME NULL AND
VOID
IN THE CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF THE RIGHTS
AGREEMENT.]1
THE
RIGHTS SHALL NOT BE EXERCISABLE FOR SECURITIES IN ANY JURISDICTION IF (I) THE
REQUISITE QUALIFICATION IN SUCH JURISDICTION SHALL NOT HAVE BEEN OBTAINED,
(II)
SUCH EXERCISE SHALL NOT BE PERMITTED UNDER APPLICABLE LAW OR (III) IF
APPLICABLE, A REGISTRATION STATEMENT IN RESPECT OF SUCH SECURITIES SHALL NOT
HAVE BEEN DECLARED EFFECTIVE.
RIGHT
CERTIFICATE
GENCO
SHIPPING & TRADING LIMITED
This
Right Certificate certifies that _________________________, or registered
assigns, is the registered holder of the number of Rights set forth above,
each
of which entitles the holder (upon the terms and subject to the conditions
set
forth in the Rights Agreement dated as of April 11, 2007 (the "Rights
Agreement") between Genco Shipping & Trading Limited, a Xxxxxxxx Islands
Corporation (the "Company"), and Mellon Investor Services LLC (the "Rights
Agent")) to purchase from the Company, at any time after the Distribution Date
and prior to the Expiration Date, one-thousandth of a Preferred Share issuable
pursuant to the exercise of a Right for twenty five Dollars ($25) (the “Exercise
Price”), payable in lawful money of the United States of America, upon surrender
of this Right Certificate, with the form of election to purchase and related
certificate duly executed, and payment of the Purchase Price at an office of
the
Rights Agent designated for such purpose.
-----------------------------------------
1
If applicable, insert the portion of the legend and delete the preceding
sentence.
B-1
Terms
used herein and not otherwise defined herein have the meanings assigned to
them
in the Rights Agreement.
The
number of Rights evidenced by this Right Certificate (and the number and kind
of
shares issuable upon exercise of each Right) and the Purchase Price set forth
above are as of April 11, 2007, and may have been or in the future be adjusted
as a result of the occurrence of certain events, as more fully provided in
the
Rights Agreement.
Upon
the
occurrence of a Section 11(a)(ii) Event, if the Rights evidenced by this Right
Certificate are beneficially owned by (a) an Acquiring Person or an Associate
or
Affiliate of an Acquiring Person, (b) a transferee of an Acquiring Person (or
any such Associate or Affiliate) who becomes a transferee after the Acquiring
Person becomes such, or (c) under certain circumstances specified in the Rights
Agreement, a transferee of an Acquiring Person (or any such Associate or
Affiliate) who becomes a transferee prior to or concurrently with the Acquiring
Person becoming such, such Rights shall become null and void, and no holder
hereof shall have any right with respect to such Rights from and after the
occurrence of such Section l1(a)(ii) Event.
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, which
limitations of rights include the temporary suspension of the exercisability
of
such Rights under the specific circumstances set forth in the Rights Agreement.
Copies of the Rights Agreement are on file at the principal executive offices
of
the Company.
Upon
surrender at an office of the Rights Agent designated for such purpose and
subject to the terms and conditions set forth in the Rights Agreement, any
Rights Certificate or Certificates may be transferred or exchanged for another
Rights Certificate or Certificates evidencing a like number of Rights as the
Rights Certificate or Certificates surrendered.
Subject
to the provisions of the Rights Agreement, the Board of Directors of the Company
may, at its option at any time prior to (i) the close of business on the tenth
day after the Share Acquisition Date (or such later date as a majority of the
Continuing Directors may designate prior to such time as the Rights are no
longer redeemable) and (ii) the Final Expiration Date, redeem all but not less
than all the then outstanding Rights at a redemption price of $0.01 per Right,
appropriately adjusted to reflect any stock split, stock dividend or similar
transaction occurring after the date hereof.
No
fractional Common Shares 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. If this Right Certificate shall be exercised in part,
the holder shall be entitled to receive upon surrender hereof another Right
Certificate or Certificates for the number of whole Rights not
exercised.
B-2
No
holder
of this Right Certificate shall be entitled to vote, receive dividends or be
deemed for any purpose the holder of the shares 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 shareholder of the Company or any right to vote for the
election of directors or upon any matter submitted to shareholders at any
meeting thereof, or to give or withhold consent to any corporate action, or
to
receive notice of meetings or other actions affecting shareholders (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.
This
Right Certificate shall not be valid or obligatory for any purpose until it
shall have been countersigned by the Rights Agent.
B-3
IN
WITNESS WHEREOF,
the
Company has caused this instrument to be duly executed under its corporate
seal
by its authorized officers.
Dated
as
of
|
GENCO
SHIPPING & TRADING LIMITED
|
|
|
THE
COMMON SEAL )
OF
GENCO SHIPPING & TRADING LIMITED )
was
affixed to this deed )
in
the presence of
)
|
By:_______________________________
Name:
Xxxxxx Xxxxxx Xxxxxxxx
Title:
President
By:_______________________________
Name:
Xxxx X. Xxxxxxxxxx
Title:
Secretary
|
|
Countersigned:
Mellon
Investor Services LLC
as
Rights Agent
By:____________________________
Authorized
Signature
|
B-4
Form
of
Reverse Side of Right Certificate
FORM
OF
ASSIGNMENT
(To
be
executed if the registered 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:
_________________, 20—
_________________________________
Signature
Signature
Guaranteed:
Signatures
must be guaranteed by a participant in the Securities Transfer Agent Medallion
Program, the Stock Exchanges Medallion Program or the New York Stock Exchange,
Inc. Medallion Signature Program.
B-5
Certificate
The
undersigned hereby certifies by checking the appropriate boxes
that:
(1) the
Rights evidenced by this Right Certificate ___ are ___ are not being assigned
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 in 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:
___________, 20__ _______________________________
Signature
Signature
Guaranteed:
Signatures
must be guaranteed by a participant in the Securities Transfer Agent Medallion
Program, the Stock Exchanges Medallion Program or the New York Stock Exchange,
Inc. Medallion Signature Program.
The
signatures to the foregoing Assignment and Certificate 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.
B-6
FORM
OF
ELECTION TO PURCHASE
(To
be
executed if the registered holder desires to exercise
Rights
represented by the Right Certificate.)
To:
Genco
Shipping & Trading Limited
The
undersigned hereby irrevocably elects to exercise _____________ Rights
represented by this Right Certificate to purchase Preferred Shares issuable
upon
the exercise of the Rights (or such other securities of the Company or of any
other person which may be issuable upon the exercise of the Rights) and requests
that certificates for such securities be issued in the name of and delivered
to:
Please
insert social security
or
other identifying number
___________________________________________________________________________
(Please
print name and address)
___________________________________________________________________________
If
such
number of Rights shall not be all the Rights evidenced by this Right
Certificate, a new Right Certificate for the balance of such Rights shall be
registered in the name of and delivered to:
Please
insert social security
or
other identifying number
___________________________________________________________________________
(Please
print name and address)
___________________________________________________________________________
Dated:
____________, 20__
_______________________________
Signature
Signature
Guaranteed:
Signatures
must be guaranteed by a participant in the Securities Transfer Agent Medallion
Program, the Stock Exchanges Medallion Program or the New York Stock Exchange,
Inc. Medallion Signature Program.
B-7
Certificate
The
undersigned hereby certifies by checking the appropriate boxes
that:
(1) the
Rights evidenced by this Right Certificate [___] are [___] are not being
assigned 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
in 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:
___________, 20__ _______________________________
Signature
Signature
Guaranteed:
Signatures
must be guaranteed by a participant in the Securities Transfer Agent Medallion
Program, the Stock Exchanges Medallion Program or the New York Stock Exchange,
Inc. Medallion Signature Program.
The
signatures to the foregoing Assignment and Certificate 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.
In
the
event the certification set for above in the Election to Purchase, is not
completed, the Company and the Rights Agent will deem the beneficial owner
of
the Rights evidenced by this Rights Certificate to be an Acquiring Person or
an
Affiliate or Associate thereof (as defined in the Rights Agreement) and such
Assignment or Election to Purchase will not be honored.
B-8
Exhibit
C
SUMMARY
OF RIGHTS
|
Distribution
and Transfer of Rights:
|
|
|
Distribution
Date:
|
The
rights will separate from the common stock and become exercisable
after
(1) a person or group acquires ownership of 15% or more of the company's
common stock or (2) the 10th business day (or such later date as
determined by the company’s board of directors) after a person or group
announces a tender or exchange offer which would result in that person
or
group holding 15% or more of the company's common
stock.
|
|
Preferred
Stock Purchaseable Upon Exercise of Rights:
|
On
the Distribution Date, each holder of a right will be entitled to
purchase
for $25 (the “Exercise Price”) a fraction (1/1000th) of one share of the
company’s preferred stock which has similar economic terms as one share of
common stock.
|
|
Flip-in:
|
If
an acquiring person (an “Acquiring Person”) acquires more than 15% of the
company's common stock then each holder of a right (except that acquiring
person) will be entitled to buy at the Exercise Price, a number of
shares
of the company's common stock which has a market value of twice the
Exercise Price.
|
|
Flip-over:
|
If
after an Acquiring Person acquires more than 15% of the company's
common
stock, the company merges into another company (either as the surviving
corporation or as the disappearing entity) or the company sells more
than
50% of its assets or earning power, then each holder of a right (except
for those owned by the acquirer) will be entitled to purchase at
the
Exercise Price, a number of shares of common stock of the surviving
entity
which has a then current market value of twice the Exercise
Price.
|
C-1
|
Exchange
Provision:
|
Any
time after the date an Acquiring Person obtains more than 15% of
the
company's common stock and before that Acquiring Person acquires
more than
50% of the company's outstanding common stock, the company may exchange
each right owned by all other rights holders, in whole or in part,
for one
share of the company's common stock.
|
|
Redemption
of Rights:
|
The
company can redeem the rights at any time prior to a public announcement
that a person has acquired ownership of 15% or more of the company's
common stock.
|
|
Expiration
of Rights:
|
The
rights expire on the earliest of (1) February 21, 2015 or (2) the
exchange
or redemption of the rights as described above.
|
|
Amendment
of Terms of Rights:
|
The
terms of the rights and the Shareholder Rights Plan may be amended
without
the consent of the rights holders at any time on or prior to the
Distribution Date. After the Distribution Date, the terms of the
rights
and the Shareholder Rights Plan may be amended to make changes, which
do
not adversely affect the rights of the rights holders (other than
the
Acquiring Person).
|
|
Voting
Rights:
|
The
rights will not have any voting rights.
|
|
Anti-dilution
Provisions:
|
The
rights will have the benefit of certain customary anti-dilution
protections
|
C-2
