AMENDMENT NO. 1
TO
RIGHTS AGREEMENT
Amendment No. 1 to Rights Agreement, dated January 16, 1998,
to Rights Agreement, dated as of November 1, 1996 (the "Rights Agreement")
between Arcadia Financial Ltd. (formerly Olympic Financial Ltd.), a Minnesota
corporation, and Norwest Bank Minnesota, N.A. (all terms not otherwise
defined herein shall have the meanings ascribed to them in the Rights
Agreement).
WITNESSETH:
WHEREAS, the Company and the Rights Agent have previously
entered into the Rights Agreement specifying the terms of the Rights;
WHEREAS, Section 27 of the Rights Agreement provides that,
prior to the Distribution Date and subject to certain limitations contained
in such Section, the Company may by resolution of its Board of Directors
(which resolution shall be effective only with the concurrence of a majority
of the Continuing Directors and only if the Continuing Directors constitute a
majority of the number of directors then in office) and the Rights Agent
shall, if the Company so directs, supplement or amend any provision of the
Rights Agreement without the approval of any holders of certificates
representing shares of Common Stock;
WHEREAS, no Distribution Date has occurred;
WHEREAS, Continuing Directors constitute a majority of the
number of directors currently in office; and
WHEREAS, the Company's Board of Directors, with the
concurrence of a majority of the Continuing Directors, has duly approved
amending the Rights Agreement to contain the terms and conditions hereinafter
set forth.
NOW, THEREFORE, in consideration of the premises and the
mutual agreements set forth herein, the parties hereby agree as follows:
1. AMENDMENT TO SECTION 1(a). Section 1(a) of the Rights
Agreement is hereby amended in its entirety to read as follows:
(a) "'Acquiring Person' shall mean any Person who or which,
together with all Affiliates and Associates of such
Person, shall be the Beneficial Owner of 18% or more of
the shares of Common Stock then outstanding, but shall
not include (i) the Company, (ii) any Subsidiary of the
Company, (iii) any employee benefit plan of the Company
or of any Subsidiary of the
Company, (iv) any Person or entity organized, appointed
or established by the Company for or pursuant to the
terms of any such plan, or (v) any person holding
Common Stock issued to that person by the Company in a
transaction approved in advance by a majority of the
Continuing Directors of the Company to the extent and
only to the extent so approved (each of (i) through
(v), an "EXEMPTED PERSON"). Notwithstanding the
foregoing, (i) no Person shall become an "Acquiring
Person" as a result of an acquisition of Common Stock
by the Company which, by reducing the number of such
shares then outstanding, increases the proportionate
number of shares beneficially owned by such Person to
18% or more of the outstanding Common Stock, except
that if such Person, after such share purchases by the
Company, becomes the Beneficial Owner of any additional
shares of Common Stock, such Person shall be deemed to
be an "Acquiring Person," and (ii) if the Board of
Directors of the Company determines in good faith that
a Person who would otherwise be an "Acquiring Person"
has become such inadvertently, and such Person divests
as promptly as practicable a sufficient number of
Common Stock so that such Person would no longer be an
Acquiring Person then such Person shall not be deemed
to be an "Acquiring Person." The term "OUTSTANDING,"
when used with reference to a Person's Beneficial
Ownership of securities of the Company, shall mean the
number of such securities then issued and outstanding
together with the number of such securities not then
issued and outstanding which such Person would be
deemed to beneficially own hereunder."
2. OTHER PROVISIONS. The other provisions of the Rights
Agreement shall continue in full force and effect as set forth in the Rights
Agreement and are not affected in any way by this Amendment No. 1.
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment No. 1 to be duly executed on the day and year first set forth above.
ARCADIA FINANCIAL LTD.
By: /s/ Xxxxx X. Xxxxxxxx III
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Xxxxx X. Xxxxxxxx III
Senior Vice President
NORWEST BANK MINNESOTA, N.A.,
NORWEST SHAREOWNER SERVICES
By: /s/ Xxxxx Xxxxxxxxxx
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Xxxxx Xxxxxxxxxx
Account Manager
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