SECOND AMENDMENT TO RIGHTS AGREEMENT
Recitals
This Second Amendment to Rights Agreement (the "Second Amendment") is made and
entered into by and among Wachovia Bank of North Carolina, N.A. ("Wachovia"),
Baldor Electric Company, a Missouri corporation, ("Baldor") and Continental
Stock Transfer & Trust Company, a New York banking corporation formed under
banking laws of the state of New York and having corporate trust powers pursuant
thereto ("Continental"), and will be effective as of the 1st day of June , 1999.
WHEREAS, Wachovia is currently the transfer agent, registrar and dividend paying
agent for the common stock of Baldor and is the "Rights Agent" as that term is
defined in, and pursuant to, that certain Baldor Electric Company Rights
Agreement dated as of May 6, 1988, by and among Baldor and Wachovia as amended
by Amendment #1 thereto dated as of February 5, 1996 (collectively the "Rights
Agreement"); and
WHEREAS, effective October 16, 1998, Wachovia subcontracted with Boston
EquiServe to perform Wachovia's duties as the rights agent under the Rights
Agreement; and
WHEREAS, Wachovia desires to resign as the Rights Agent under the Rights
Agreement, Baldor desires that Continental, rather than Boston EquiServe serve
as successor Rights Agent and Continental is willing to serve as successor
Rights Agent; and
WHEREAS, Section 21 of the Rights Agreement must be amended so that Continental
is able to qualify to serve as Rights Agent and the Executive Committee of the
Board of Directors of Baldor, by unanimous written consent dated as of May 3,
1999: (i) approved the amendment of Section 21 so that Continental shall so
qualify, (ii) approved the resignation of Wachovia as Rights Agent under the
Rights Agreement, (iii) approved the appointment of Continental as the successor
Rights Agent under the Rights Agreement, (iv) approved any and all other
amendments to the Rights Agreement which such officers may deem necessary,
desirable, convenient or appropriate to permit or otherwise induce Continental
to serve as Rights Agent, and (v) authorized the proper officers to take any and
all other actions deemed necessary to carry out the intent of the foregoing; and
WHEREAS, the parties hereto wish to acknowledge that immediately after the
approval of the amendment of Section 21 of the Rights Agreement, Wachovia shall
resign as Rights Agent and Continental shall be appointed the successor Rights
Agent; and
WHEREAS, Sections 1, 2, 3, 4, 5, 6 and 7 hereof are deemed to have occurred in
the order set forth in the Second Amendment, such that Wachovia shall not be
deemed to have resigned as Rights Agent until the amendments of Section 21 of
the Rights Agreement is effective, and Continental shall not be deemed to have
been appointed successor Rights Agent until Wachovia shall be deemed to have
resigned and Continental shall have made the representations and warranties to
Baldor set forth in Section 3 below, following which the address of the Rights
Agent shall be deemed to have changed as set forth in Section 5 below, and
certain other provisions contained in the Rights Agreement shall be deemed to
have been amended as set forth in Section 7 below.
NOW, THEREFORE, in consideration of the foregoing and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties agree as follows:
Section 1. Section 21 of the Rights Agreement is hereby modified and
amended by deleting the fifth sentence (not including the
caption) in its entirety and replacing it with:
Any successor Rights Agent, whether appointed by the
Company or by such a court, shall be either: (a) a
banking corporation 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 corporate
trust powers and is subject to supervision or
examination by federal or state authority and which
has at the time of its appointment as Rights Agent a
combined capital, surplus and blanket bond insurance
of at least $25,000,000; or (b) an affiliate of such
a banking corporation with trust powers.
Section 2. Upon the effectiveness of the amendment of Section 21 of
the Rights Agreement pursuant hereto, Wachovia hereby resigns
as the Rights Agent under the Rights Agreement.
Section 3. Effective upon the resignation of Wachovia as Rights Agent,
Continental hereby represents and warrants that it meets the
eligibility requirements to be the successor Rights Agent (as
described in Section 1 of the Second Amendment (which is the
same as Section 21 of the Rights Agreement as amended by this
Second Amendment) (the "Rights Agreement as Amended").
Section 4. Effective upon the resignation of Wachovia as
Rights Agent, Continental hereby accepts, and agrees
pursuant to Sections 20 and 21 of the Rights Agreement as
Amended to perform, all of the rights, powers, duties and
obligations as Rights Agent under, and in accordance with
the terms of, the Rights Agreement as Amended. In executing
this Second Amendment, Continental shall be entitled to all
the privileges and immunities afforded to the Rights Agent
under the terms and conditions of the Rights Agreement as
Amended. Section 5. The address to which all notices and
communications to Continental as Rights Agent are to be
delivered (in lieu of the prior address of Wachovia as the
prior Rights Agent) is: Continental Stock Transfer & Trust
Company 0 Xxxxxxxx Xxx Xxxx, Xxx Xxxx 00000 and Section 25
of the Rights Agreement is hereby deemed amended to reflect
this new address for the Rights Agent. Section 6.
Henceforth, the term "Rights Agent" as used in the Rights
Agreement shall mean Continental. In furtherance of the
foregoing, the legend required on certificates of Baldor
common stock pursuant to Section 3(c) of the Rights
Agreement shall read as follows:
This certificate also evidences and entitles the
holder hereof to certain Rights as set forth in the
Rights Agreement dated as of May 6, 1988, as amended
by the First Amendment thereto dated as of February
5, 1996, as further amended as of June 1, 1999,
between Baldor Electric Company (the "Company") and
Continental Stock Transfer & Trust Company (the
"Rights Agreement as Amended"), the terms of which
are hereby incorporated herein by reference and a
copy of which is on file at the principal offices of
the Company. Under certain circumstances, as set
forth in the Rights Agreement as Amended, such Rights
will be evidenced by separate certificates and will
no longer be evidenced by this certificate. The
Company will mail to the holder of this certificate a
copy of the Rights Agreement as Amended without
charge promptly after receipt of a written request
therefor. Under certain circumstances, Rights
beneficially owned by Acquiring Persons (as defined
in the Rights Agreement as Amended) and any
subsequent holder of such Rights may become null and
void.
Section 7. The following provisions of the Rights Agreement are hereby amended
as set forth below:
(a) Section 1(e) of the Rights Agreement is hereby
amended in its entirety to read as follows:
"Business Day" shall mean any day other than
a Saturday, Sunday, or a day on which the
Rights Agent is authorized or obligated by
law or executive order to close.
(b) Section 1(f) of the Rights Agreement is hereby
amended in its entirety to read as follows:
"Close of Business" on any given date shall
mean 5:00 P.M. E.S.T.or E.D.T, as
appropriate, on such date; provided,
however, that if such date is not a
Business Day, it shall mean 5:00 P.M.
E.S.T. or E.D.T., as appropriate, on the
next succeeding Business Day.
(c) Section 5(b) of the Rights Agreement is hereby
amended in its entirety to read as follows:
Following the Distribution Date, the Rights
Agent will keep or cause to be kept, at one
of its offices, 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.
Section 23(a)(i) of the Rights Agreement is hereby
amended such that the words "Winston-Salem, North
Carolina time," are deleted and replaced with "E.S.T.
or E.D.T., as appropriate".
Section 8. All references in the Rights Agreement to this "Agreement",
the "Rights Agreement and any other references of similar
import shall henceforth mean the Rights Agreement as Amended
and any further amendments or modifications thereof.
Section 9. All of the provisions of the Rights Agreement not amended
by this amendment shall remain in full force and.
Section 10. In the event of any inconsistency or conflict between this
Second Amendment and the Rights Agreement, the terms,
provisions and conditions contained in this Second Amendment
shall govern and control.
Section 11. (a) This Second Amendment, as it amends the
Rights Agreement, constitutes the entire agreement
and understanding of the parties with respect to the
subject matter hereof, and it supersedes all prior
negotiations, commitments, representations and
undertakings of the parties with respect to the
subject matter hereof.
(b) This Second Amendment shall be binding upon and inure
to the benefit of Baldor, Wachovia, Continental and
their respective successors and permitted assigns.
(c) This Second Amendment shall be deemed to be a
contract made under the laws of the State of Missouri
and for all purposes shall be governed by and
construed in accordance with the laws of such State
applicable to contracts made and to be performed
entirely within such state.
(d) This Second Amendment may be executed in
counterparts, each of which shall be deemed an
original, but all of which together shall constitute
one and the same instrument.
(e) Any capitalized word not otherwise defined in this
Second Amendment shall have the meaning given to such
word in the Rights Agreement.
(f) The Second Amendment may not be modified except by a
writing signed by authorized representatives of the
parties to the Second Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this Second Amendment to
Rights Agreement to be executed by their respective duly authorized officers as
of the 3rd day of May, 1999.
Baldor Electric Company Attest:
By: __________________________________ By: _______________________________
Name: _______________________________ Name: ____________________________
Title: ________________________________ Title: _____________________________
Wachovia Bank of North Carolina, N.A.
as resigning Rights Agent Attest:
By: __________________________________ By: _______________________________
Name: _______________________________ Name: ____________________________
Title: ________________________________ Title: _____________________________
Continental Stock Transfer & Trust Company
as successor Rights Agent Attest:
By: __________________________________ By: _______________________________
Name: _______________________________ Name: ____________________________
Title: ________________________________ Title: _____________________________
OFFICER'S CERTIFICATE
The undersigned, Xxxxx X. Xxxxx, the duly authorized Secretary of Baldor
Electric Company (the "Company") hereby certifies that, pursuant to Section 26
of the Rights Agreement dated May 6, 1988 by and between the Company and
Wachovia Bank of North Carolina, N.A., as amended by Amendment #1 dated February
5, 1996, the Attached Amendment No. 2 to the Rights Agreement is in compliance
with Section 26 of the Rights Agreement as Amended.
IN WITNESS WHEREOF, the undersigned has executed this Officer's Certificate as
of this 3rd day of May 1999.
/s/ Xxxxx X. Xxxxx
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Secretary
