AMENDMENT NO. 1 TO RIGHTS AGREEMENT
Exhibit
3.1
AMENDMENT
NO. 1 TO RIGHTS AGREEMENT
This
First Amendment (this “Amendment”) to that certain Rights Agreement dated as of
October 25, 2006 between the parties (the “Rights Agreement”) is entered into as
of March 12, 2008 between Energy Focus, Inc., a Delaware corporation (the
“Company”), and Mellon Investor Services LLC, a New Jersey limited liability
company (the “Rights Agent”). Capitalized terms used but not defined in this
Amendment have the meanings given to them in the Rights Agreement.
WHEREAS,
the Company changed its name from Fiberstars, Inc. to Energy Focus, Inc. on
May
7, 2007;
WHEREAS,
Section 27 of the Rights Agreement provides that, prior to the Distribution
Date, the Company and the Rights Agent may from time to time supplement or
amend
the Rights Agreement without the approval of any holders of Rights or Rights
Certificates in order to change or supplement any provision hereunder in a
manner which the Company may deem necessary or desirable;
WHEREAS,
on the date of this Amendment, the Distribution Date has not occurred;
WHEREAS,
the Company hereby certifies to the Rights Agent that this Amendment is in
compliance with Section 27 of the Rights Agreement; and
WHEREAS,
the Board of Directors of the Company, pursuant to Section 27 of the Rights
Agreement, has resolved to amend the Rights Agreement to allow the Quercus
Trust, and Persons who are Beneficial Owners through the Trust, to have a
beneficial ownership percentage of up to twenty percent (20%);
NOW
THEREFORE, in consideration of the mutual agreement below, the parties agree
as
follows.
1. Amendments.
The
Rights Agreement is amended as follows:
1.1.
Section 1(a) is amended and restated in its entirety to read as
follows:
“(a) "Acquiring
Person"
shall
mean any Person (as such term is hereinafter defined) who or which, together
with all Affiliates (as such term is hereinafter defined) and Associates (as
such term is hereinafter defined) of such Person, shall be the Beneficial Owner
(as such term is hereinafter defined) of fifteen percent (15%) (except that
such
percentage shall be 20% for The Quercus Trust and Persons who or which are
Beneficial Owners through the Trust (Quercus, together with such Persons, the
“Quercus Owners”)) or more of the shares of Common Stock then outstanding or who
was such a Beneficial Owner at any time on or after the date hereof, whether
or
not such Person continues to be the Beneficial Owner of fifteen percent (15%)
(or in the case of the Quercus Owners, 20%) or more of the outstanding shares
of
Common Stock. Notwithstanding the foregoing:
(i) in
no event shall a Person who or which, together with all Affiliates and
Associates
of such Person, is the Beneficial Owner of less than fifteen percent (15%)
(or
in
the case of the Quercus Owners, 20%) of the outstanding shares of Common
Stock
become an Acquiring Person solely as a result of a reduction of the number
of
shares
of
outstanding Common Stock, including repurchases of outstanding shares of
Common
Stock by the Company, which reduction increases the percentage of outstanding
shares of Common Stock Beneficially Owned (as such term is hereinafter
defined)
by such Person; provided,
however,
that
any subsequent increase in the amount
of
Common Stock Beneficially Owned by such Person, together with all Affiliates
and Associates of such Person, without the prior written approval of the
Board
shall cause such Person to be an Acquiring Person (unless, measured at such
time,
such Person would not be an Acquiring Person);
(ii) the
term Acquiring Person shall not mean: (A) the Company; (B) any
Subsidiary(as such term is hereinafter defined) of the Company; (C) any
employee benefit plan of the Company or any of its Subsidiaries; (D) any
entity holding securities of the Company organized, appointed or established
by
the Company or any of its Subsidiaries for or pursuant to the terms of any
such
plan; or (E) any underwriter acting in good faith in a firm commitment
underwriting of an offering of the Company's securities pursuant to arrangements
with the Company that have been approved by the Board (however,
the
exception provided by this clause (E)
shall
no
longer be available in the event that any such underwriter is otherwise an
Acquiring Person on or after the date which is forty (40) days after the
date of initial acquisition
of the Company's securities by such underwriter in connection with such
offering); and
(iii) no
Person shall be deemed to be an Acquiring Person if: (A)(1) any Schedule 13D
under the Exchange Act (as hereinafter defined), or any comparable or
successor
report, filed (or required to be filed) by such Person does not (or would not)
state
any
intention to or reserve the right to control or influence the management or
policies
of the Company or engage in any of the actions specified in Item 4 (or any
comparable
or successor Item) of such Schedule 13D (other than the disposition of
Common
Stock), (2) either (x) within two (2) Business Days of being
requested by the
Company to advise the Company regarding the same, such Person certifies in
writing
to the Company that such Person acquired Beneficial Ownership of fifteen
percent
(15%) (or in the case of the Quercus Owners, 20%) or more of the outstanding
shares of Common Stock inadvertently or without knowledge of the terms
of
the Rights, or (y) the Board determines in good faith that such Person has
become
an
Acquiring Person inadvertently, (3) such Person divests as promptly as
practicable
(as determined in good faith by the Board) a sufficient number of securities
so that such Person would not be deemed to be an Acquiring Person pursuant
to the first sentence of this Section 1(a),
(or
such other provisions of this Section 1(a)
as may be applicable) and (4) promptly following such Person's divestiture
of such securities, such Person certifies to the Board that such Person
would
no
longer be deemed an Acquiring Person as defined pursuant to the first
sentence
of this Section 1(a)
(or
such
other provisions of this Section 1(a) as may be applicable);
or (B) by reason of such Person's Beneficial Ownership of fifteen percent
(15%)
(or
in the case of the Quercus Owners, 20%) or more of the outstanding shares
of
Common
Stock on the date hereof if prior to the Record Date such Person notifies
the
Board
that such Person is no longer the Beneficial Owner of fifteen percent (15%)
(or
in
the case of the Quercus Owners, 20%) or more of the then outstanding shares
of
Common
Stock.”
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1.2.
The
second full paragraph of Exhibit C, entitled “Summary of Rights”, is amended and
restated in its entirety to read as follows:
“Initially,
the Rights will be attached to all Common Stock certificates representing shares
then outstanding, and no separate Rights certificates will be distributed.
The
Rights will separate from the Common Stock and a "Distribution
Date"
will
occur upon the earliest of the following: (i) a public announcement that a
person, entity or group of affiliated or associated persons and/or entities
(an
"Acquiring
Person")
has
acquired, or obtained the right to acquire, beneficial ownership of fifteen
percent (15%) (or, in the case of the Quercus Owners, 20%) or more of the
outstanding shares of Common Stock (other than (A) as a result of
repurchases of stock by the Company or certain inadvertent actions by
institutional or certain other shareholders, (B) the Company, any
subsidiary of the Company or any employee benefit plan of the Company or any
subsidiary, and (C) certain other instances set forth in the Rights
Agreement); or (ii) ten (10) business days (unless such date is
extended by the Board of Directors) following the commencement of a tender
offer
or exchange offer which would result in any person, entity or group of
affiliated or associated persons and/or entities becoming an Acquiring Person
(unless such tender offer or exchange offer is a Permitted Offer (defined
below)).”
2.
Miscellaneous.
2.1.
No
Further Amendments.
Except
as specifically amended by this First Amendment, the Rights Agreement shall
remain unmodified and in full force and effect, and the Rights Agreement is
hereby ratified and affirmed in all respects.
2.2.
Governing
Law.
This
First Amendment shall be governed by and construed in accordance with the State
of Delaware; provided, however, that all provisions regarding the rights, duties
and obligations of the Rights Agent shall be governed by and construed in
accordance with the laws of the State of New York applicable to contracts made
and to be performed entirely within such State.
2.3.
Counterparts.
This
First Amendment may be executed in any number of counterparts and each of those
counterparts shall for all purposes be deemed to be an original, and all of
those counterparts shall together constitute one and the same
instrument.
[Signatures
on following page.]
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IN
WITNESS WHEREOF, the parties have executed this First Amendment as of the date
first written above.
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ENERGY
FOCUS, INC
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| By: | /s/ Xxxx X. Xxxxxxxxx | |
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Xxxx X. Xxxxxxxxx President
and Chief Executive Officer
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MELLON
INVESTOR SERVICES LLC
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| By: | /s/ Xxx Xxxx | |
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Xxx
Xxxx
Senior
Relationship Manager
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