AMENDMENT TO AMENDED AND RESTATED RIGHTS AGREEMENT
AMENDMENT
TO AMENDED AND RESTATED RIGHTS AGREEMENT
This
Amendment to Amended and Restated Rights Agreement (this “Amendment”)
is
made as of April 16, 2007, by and between Point.360, a California corporation
(the “Corporation”),
and
American Stock Transfer & Trust Company, a New York banking corporation (the
“Rights
Agent”).
WHEREAS,
the Corporation is entering into an Agreement and Plan of Merger and
Reorganization (as the same may be amended from time to time, the “Merger
Agreement”),
among
the Corporation, DG FastChannel, Inc., a Delaware corporation (the “Purchaser”),
and
New 360, a California corporation, pursuant to which the Purchaser will: (1)
make an exchange offer to acquire all of the issued and outstanding shares
of
common stock of the Corporation, no par value (“Common
Shares”),
on
the terms and subject to the conditions set forth in the Merger Agreement (such
exchange offer, as it may be amended from time to time, is referred to in this
Amendment as the “Offer”),
(ii)
be granted an irrevocable option to acquire certain additional Common Shares
directly from the Corporation on the terms and subject to the conditions set
forth in the Merger Agreement (the “Top-Up
Option”),
and
(iii) after the Purchaser has acquired Common Shares pursuant to the Offer
(and,
if applicable, the Top-Up Option), the Corporation will merge with and into
the
Purchaser upon the terms and subject to the conditions set forth in the Merger
Agreement;
WHEREAS,
the Corporation and the Rights Agent are parties to an Amended and Restated
Rights Agreement dated as of November 17, 2004 (the “Rights
Agreement”);
WHEREAS,
the Corporation desires to amend the Rights Agreement in connection with the
execution and delivery of the Merger Agreement; and
WHEREAS,
the Board of Directors of the Corporation has approved this Amendment and
authorized its appropriate officers to execute and deliver the same to the
Rights Agent.
NOW,
THEREFORE, in accordance with the procedures for amendment of the Rights
Agreement set forth in Section 27 of the Rights Agreement, and in consideration
of the foregoing and the mutual agreements herein set forth, the parties hereby
agree as follows:
1. Capitalized
terms that are not otherwise defined herein shall have the meanings ascribed
to
them in the Rights Agreement.
2. The
definition of “Acquiring Person” set forth in Section 1(a) of the Rights
Agreement is amended by adding the following sentence to the end of that
section:
“Notwithstanding
the foregoing, no Person shall be or become an Acquiring Person by reason of
(i)
the execution and delivery of the Agreement and Plan of Merger and
Reorganization, dated as of April 16, 2007, among DG FastChannel, Inc., a
Delaware corporation (the “Purchaser”),
New
360, a California corporation, and the Corporation (the “Merger
Agreement”)
or any
amendment thereto, (ii) the purchase by the Purchaser of Common Shares pursuant
to (A) an exchange offer to acquire all of the issued and outstanding Common
Shares to be commenced by the Purchaser pursuant to, and on the terms and
subject to the conditions set forth in, the Merger Agreement (such exchange
offer, as it may be amended from time to time, is referred to in this Agreement
as the “Offer”)
or (B)
an irrevocable option to acquire certain additional shares of Common Shares
directly from the Corporation granted by the Corporation to the Purchaser on
the
terms and subject to the conditions set forth in the Merger Agreement (the
“Top-Up
Option”),
(iii)
the merger of the Corporation with and into the Purchaser pursuant to, and
on
the terms and subject to the conditions set forth in, the Merger Agreement
(the
“Merger”),
or
(iv) the consummation of any other transaction contemplated by the Merger
Agreement, as it may be amended from time to time.”
3. The
definition of “Shares
Acquisition Date”
in
Section 1(q) of the Rights Agreement is hereby amended by adding the following
sentence to the end of that section:
“Notwithstanding
anything else set forth in this Agreement, a Shares Acquisition Date shall
be
deemed not to have occurred by reason of (i) the execution and delivery or
amendment of the Merger Agreement, (ii) the purchase by the Purchaser of Common
Shares pursuant to the Offer (and, if applicable, the Top-Up Option), (iii)
the
Merger, or (iv) the consummation of any other transaction contemplated by the
Merger Agreement, as it may be amended from time to time.”
4. Section
3(a) of the Rights Agreement is hereby amended by adding the following sentence
to the end of that section:
“Notwithstanding
anything else set forth in this Agreement, no Distribution Date shall be deemed
to have occurred by reason of (i) the execution and delivery or amendment of
the
Merger Agreement, (ii) the purchase by the Purchaser of Common Shares pursuant
to the Offer (and, if applicable, the Top-Up Option), (iii) the Merger, or
(iv)
the consummation of any other transaction contemplated by the Merger Agreement,
as it may be amended from time to time.”
5. Section
7(a)(i) of the Rights Agreement is hereby amended to delete the phrase “(the
“Final
Expiration Date”)”
so
that it shall read as follows:
“(i)
the
close of business on November 16, 2014,”
6. Section
7(a) is further amended by replacing the word “or” at the end of Section
7(a)(ii) with a comma and by adding the following clause immediately following
the word “hereof’ in Section 7(a)(iii):
“,
or
(iv) the moment in time immediately prior to the Effective Time (as defined
in
Section 1.6 of the Merger Agreement) (the earliest to occur of the events
described in clauses (i) to (iv) of this section shall be referred to as the
“Final
Expiration Date”).”
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7. Section
11(a)(ii) of the Rights Agreement is hereby amended by adding the following
sentence to the end of that section:
“Notwithstanding
anything else set forth in this Agreement, no event requiring an adjustment
under this Section 11(a)(ii) shall be deemed to have occurred by reason of
(i)
the execution and delivery or amendment of the Merger Agreement, (ii) the
purchase by the Purchaser of Common Shares pursuant to the Offer (and, if
applicable, the Top-Up Option), (iii) the Merger, or (iv) the consummation
of
any other transaction contemplated by the Merger Agreement, as it may be amended
from time to time.”
8. The
first
phrase of Section 13(c) of the Rights Agreement is hereby amended to read as
follows:
“The
Corporation shall not consummate any such consolidation, merger, sale or
transfer (other than the Merger) unless the Principal Party shall have a
sufficient number of authorized shares of its 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 Corporation and
each Principal Party and each other Person who may become a Principal Party
as a
result of such consolidation, merger, sale or transfer shall have executed
and
delivered to the Rights Agent a supplemental agreement providing for the terms
set forth in paragraphs (a) and (b) of this Section 13 and further providing
that, as soon as practicable after the date of any consolidation, merger, sale
or transfer of assets mentioned in paragraph (a) of this Section 13, the
Principal Party at its own expense shall:”
The
remaining portion of Section 13(c) shall be unchanged and shall remain in full
force and effect.
9. All
of
the covenants of this Amendment by or for the benefit of the Corporation or
the
Rights Agent shall bind and inure to the benefit of their respective successors
and assigns hereunder.
10. Nothing
in this Amendment shall be construed as giving to any person or entity other
than the Corporation, the Purchaser, the Rights Agent, and the registered
holders of the Rights Certificates (and, prior to the Distribution Date, the
Common Shares) any legal or equitable right, remedy, or claim under this
Amendment; but this Amendment shall be for the sole and exclusive benefit of
the
Corporation, the Purchaser, the Rights Agent, and the registered holders of
the
Rights Certificates (and, prior to the Distribution Date, the Common
Shares).
11. If
any
term of this Amendment is held by a court of competent jurisdiction or other
authority to be invalid, void, or unenforceable, the remainder of the terms
of
this Amendment shall remain in full force and effect and shall in no way be
affected, impaired, or invalidated.
12. This
Amendment shall become effective immediately prior to the execution and delivery
of the Merger Agreement by all of the parties thereto. The Rights Agreement,
as
amended by this Amendment, shall remain in full force and effect in accordance
with its terms, subject to the following sentence. If the Merger Agreement
is
terminated for any reason pursuant to any provision in Section 8.1 of the Merger
Agreement, each and every amendment to the Rights Agreement made by this
Amendment automatically shall be rescinded in full, effective concurrently
with
the termination of the Merger Agreement and without the need by the Corporation
to execute an instrument implementing such rescission.
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13. This
Amendment shall be deemed to be a contract made under the laws of the State
of
California and for all purposes shall be governed by and construed in accordance
with the laws of such state applicable to contracts to be made and performed
entirely within such state.
14. This
Amendment 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.
15. The
Corporation hereby certifies to the Rights Agent that this Amendment is in
compliance with Section 27 of the Rights Agreement.
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IN
WITNESS WHEREOF, the parties herein have caused this Amendment to be duly
executed and attested, all as of the date and year first above
written.
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POINT.360
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Name: Xxxx
X. Steel
Title: Executive
Vice President and Chief Financial
Officer
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AMERICAN
STOCK TRANSFER & TRUST COMPANY
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Name:
Title:
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Attest:
Name:
Title:
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