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RIGHTS AGREEMENT
between
BRUNSWICK CORPORATION
and
XXXXXX TRUST AND SAVINGS BANK
Rights Agent
Dated as of February 5, 1996
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TABLE OF CONTENTS
Page
Section 1. Certain Definitions....................................... 1
Section 2. Appointment of Rights Agent............................... 4
Section 3. Issue of Right Certificates............................... 5
Section 4. Form of Right Certificates................................ 6
Section 5. Countersignature and Registration......................... 7
Section 6. Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen Right
Certificates.............................................. 8
Section 7. Exercise of Rights; Purchase Price; Expiration Date
of Rights................................................. 9
Section 8. Cancellation and Destruction of Right Certificates........ 11
Section 9. Availability of Preferred Shares.......................... 11
Section 10.Preferred Shares Record Date.............................. 11
Section 11.Adjustment of Purchase Price, Number of Shares or Number
of Rights................................................. 12
Section 12.Certificate of Adjusted Purchase Price or Number of Shares 19
Section 13.Consolidation, Merger or Sale or Transfer of Assets or
Earning Power............................................. 19
Section 14.Fractional Rights and Fractional Shares................... 21
Section 15.Rights of Action.......................................... 22
Section 16.Agreement of Right Holders................................ 23
Section 17.Right Certificate Holder Not Deemed a Stockholder......... 23
Section 18.Concerning the Rights Agent............................... 24
Section 19.Merger or Consolidation or Change of Name of Rights Agent. 24
Section 20.Duties of Rights Agent.................................... 25
Section 21.Change of Rights Agent.................................... 27
Section 22.Issuance of New Right Certificates........................ 27
Section 23.Redemption................................................ 28
Section 00.Xxxxxxxx.................................................. 29
Section 25.Notice of Certain Events.................................. 30
Section 26.Notices................................................... 31
Section 27.Supplements and Amendments................................ 31
Section 28.Successors................................................ 32
Section 29.Benefits of this Agreement................................ 32
Section 30.Severability.............................................. 32
Section 31.Governing Law............................................. 32
Section 32.Counterparts.............................................. 32
Section 33.Descriptive Headings...................................... 32
Section 34.Determinations and Actions by the Board of Directors...... 32
Exhibit A Form of Certificate of Designation, Preferences and Rights
Exhibit B Form of Right Certificate
RIGHTS AGREEMENT
Rights Agreement, dated as of February 5, 1996, between BRUNSWICK
CORPORATION, a Delaware corporation (the "Company"), and XXXXXX TRUST AND
SAVINGS BANK (the "Rights Agent").
W I T N E S S E T H:
WHEREAS, the Board of Directors of the Company has authorized and
declared a dividend of one preferred share purchase right (a "Right") for
each Common Share (as hereinafter defined) of the Company outstanding as of
[the close of business on April 1, 1996] (the "Record Date"), each Right
representing the right to purchase one one-thousandth of a Preferred Share
(as hereinafter defined), upon the terms and subject to the conditions
herein set forth, and has further authorized and directed the issuance of
one Right with respect to each Common Share that shall become outstanding
between the Record Date and the first to occur of the Redemption Date and
the Final Expiration Date (as such terms are hereinafter defined);
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereby agree as follows:
Section 1. Certain Definitions. For purposes of this Agreement, the
following terms have the meanings indicated:
"Acquiring Person" shall mean any Person (as such term is
hereinafter defined) who or which, together with all Affiliates and
Associates (as such terms are hereinafter defined) of such Person, shall be
the Beneficial Owner (as such term is hereinafter defined) of 15% or more
of the Common Shares of the Company 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 or any
Person holding Common Shares for or pursuant to the terms of any such plan
or (iv) any Person who on the Record Date is the Beneficial Owner of 15% or
more of the Common Shares of the Company then outstanding; provided,
however, that if such Person shall on or after the Record Date (a) acquire
any additional shares of Common Shares of the Company or (b) sell or
otherwise dispose of the Common Shares held by such Person on the Record
Date in an amount sufficient so that it is no longer the Beneficial Owner
of at least 15% of the Common Shares and subsequently becomes the
Beneficial Owner of 15% or more of the Common Shares, such Person shall be
deemed to be an "Acquiring Person." Notwithstanding the foregoing, no
Person shall become an "Acquiring Person" as the result of (i) an
acquisition of Common Shares 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 Common Shares of
the Company then outstanding, or (ii) the acquisition by such Person of
newly-issued Common Shares directly from the Company (it being understood
that a purchase from an underwriter or other intermediary is not deemed for
purposes hereof to be a purchase directly from the Company); provided,
however, that if a Person shall become the Beneficial Owner of 15% or more
of the Common Shares of the Company then outstanding by reason of share
purchases by the Company or the receipt of newly-issued Common Shares
directly from the Company and shall, after such share purchases or direct
issuance by the Company, become the Beneficial Owner of any additional
Common Shares of the Company (and thereafter remains a Beneficial Owner of
15% or more of the Common Shares of the Company), then such Person shall be
deemed to be an "Acquiring Person"; and provided, further, that any
transferee from such Person who becomes the Beneficial Owner of 15% or more
of the Common Shares of the Company then outstanding shall nevertheless be
deemed to be an "Acquiring Person". Notwithstanding the foregoing, if the
Board of Directors of the Company determines in good faith that a Person
who would otherwise be an "Acquiring Person," as defined pursuant to the
foregoing provisions of this paragraph, has become such inadvertently, and
such Person divests as promptly as practicable (and in any event within ten
business days after notification by the Company) a sufficient number of
Common Shares so that such Person would no longer be an Acquiring Person,
as defined pursuant to the foregoing provisions of this paragraph, then
such Person shall not be deemed to be an "Acquiring Person" for any
purposes of this Agreement.
"Adjustment Shares" shall have the meaning set forth in
Section 11 hereof.
"Adjustment Spread" shall have the meaning set forth in
Section 24 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:
(a) which such Person or any of such Person's Affiliates or
Associates beneficially owns, directly or indirectly;
(b) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has (i) the right to acquire (whether
such right is exercisable immediately or only after the passage of time)
pursuant to any agreement, arrangement or understanding, whether written or
oral (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 these Rights), warrants or options, or otherwise;
provided, however, that a Person shall not be deemed the Beneficial Owner
of, or to beneficially own, 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; (ii) the sole or shared right to vote or dispose of
(including any such right pursuant to any agreement, arrangement or
understanding, whether written or oral); provided, however, that a Person
shall not be deemed the Beneficial Owner of, or to beneficially own, any
security 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
promulgated under the Exchange Act and (2) is not also then reportable on
Schedule 13D under the Exchange Act (or any comparable or successor
report); or (iii) "beneficial ownership" (as determined pursuant to Rule
13d-3 (or any successor rule) of the General Rules and Regulations under
the Exchange Act); or
(c) 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 written or oral (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 clause (ii) of subparagraph (b) of this definition) or disposing
of any securities of the Company.
Notwithstanding anything in this definition of Beneficial
Ownership to the contrary, the phrase "then 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 actually issued and
outstanding which such Person would be deemed to own beneficially
hereunder.
"Board of Directors" and "Board of Directors of the Company"
each shall mean the members of the board of directors of the Company.
"Business Day" shall mean any day other than a Saturday, a
Sunday, or a day on which banking institutions in Chicago, Illinois are
authorized or obligated by law or executive order to close.
"Close of business" on any given date shall mean 5:00 P.M.,
Chicago time, on such date; provided, however, that if such date is not a
Business Day it shall mean 5:00 P.M., Chicago time, on the next succeeding
Business Day.
"Common Shares" when used with reference to the Company shall
mean the shares of common stock, par value $0.75 per share, of the Company.
"Common Shares" 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 the equity securities or other equity
interest having power to control or direct the management of such other
Person.
"Current Value" shall have the meaning set forth in Section 11
hereof.
"Distribution Date" shall have the meaning set forth in
Section 3 hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.
"Exchange Ratio" shall have the meaning set forth in Section 24
hereof.
"Final Expiration Date" shall have the meaning set forth in
Section 7 hereof.
"Person" shall mean any individual, firm, corporation or other
entity, and shall include any successor (by merger or otherwise) of such
entity.
"Preferred Shares" shall mean shares of Series A Junior
Participating Preferred Stock, par value $0.75 per share, of the Company
having the rights and preferences set forth in the Form of Certificate of
Designation, Preferences and Rights attached to this Agreement as Exhibit
A.
"Purchase Price" shall have the meaning set forth in Section 4
hereof.
"Record Date" shall have the meaning set forth in the preamble
hereto.
"Redemption Date" shall have the meaning set forth in Section 7
hereof.
"Right Certificate" shall have the meaning set forth in
Section 3 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) promulgated
under the Exchange Act) by the Company or an Acquiring Person that an
Acquiring Person has become such.
"Spread" shall have the meaning set forth in Section 11 hereof.
"Subsidiary" shall mean, with reference to any Person, any
corporation or other entity of which a majority of the voting power of the
voting equity securities or equity interest is owned, directly or
indirectly, by such Person.
"Triggering Event" shall mean any event described in Section
11(a)(ii) or Section 13(a) hereof.
Any determination or interpretation required in connection with any
of the definitions contained in this Section 1 shall be made by the Board
of Directors of the Company in their good faith judgment, which
determination shall be final and binding on the Rights Agent.
Section 2. Appointment of Rights Agent. The Company hereby appoints
the Rights Agent to act as agent for the Company and the holders of the
Rights (who, in accordance with Section 3 hereof, shall prior to the
Distribution Date also be the holders of the Common Shares) 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.
Section 3. Issue of Right Certificates.
(a) Until the earlier of (i) the close of business on the tenth day
after the Shares Acquisition Date or (ii) the close of business on the
fifteenth business day (or such later date as may be determined by action
of the Board of Directors prior to such time as any Person becomes an
Acquiring Person) after the date of the commencement 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 entity holding
Common Shares for or pursuant to the terms of any such plan) of, or of the
first public announcement of the intention of 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 entity holding Common
Shares for or pursuant to the terms of any such plan) to commence, a tender
or exchange offer the consummation of which would result in any Person
becoming the Beneficial Owner of Common Shares aggregating 15% or more of
the then outstanding Common Shares (including any such date which is after
the date of this Agreement and prior to the issuance of the Rights; the
earlier of such dates being herein referred to as the "Distribution Date"),
(x) the Rights will be evidenced (subject to the provisions of Section 3(b)
hereof) by the certificates for Common Shares registered in the names of
the holders thereof (which certificates shall also be deemed to be
certificates for Rights) and not by separate certificates, and (y) the
Rights will be transferable only in connection with the transfer of the
underlying Common Shares (including a transfer to the Company).
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,
send) by first-class, insured, postage-prepaid mail, to each record holder
of Common Shares as of the close of business on the Distribution Date, at
the address of such holder shown on the records of the Company, a Right
Certificate, in substantially the form of Exhibit B hereto (a "Right
Certificate"), evidencing an aggregate number of Rights equal to one Right
for each Common Share so held. As of the Distribution Date, the Rights
will be evidenced solely by such Right Certificates.
(b) With respect to certificates for Common Shares 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, and
registered holders of Common Shares shall also be the registered holders of
the associated Rights. Until the Distribution Date (or the earlier of the
Redemption Date or the Final Expiration Date), the transfer of any
certificate for Common Shares outstanding on the Record Date shall also
constitute the transfer of the Rights associated with the Common Shares
represented thereby.
(c) Rights shall be issued in respect of all Common Shares which are
issued (whether originally issued or delivered from the Company's treasury)
after the Record Date but prior to the earliest of the Distribution Date,
the Redemption Date or the Final Expiration Date. Certificates
representing such Common Shares shall also be deemed to be certificates for
Rights. Certificates representing both Common Shares and Rights in
accordance with this Section 3 which are executed and delivered (whether
the Common Shares represented thereby are originally issued, delivered from
the Company's treasury or are presented for transfer) by the Company
(including, without limitation, certificates representing reacquired Common
Shares referred to in the last sentence of this paragraph (c)) after the
Record Date but prior to the earliest of the Distribution Date, the
Redemption Date or the Final Expiration Date shall have impressed on,
printed on, written on or otherwise affixed to them a legend substantially
equivalent to the following:
This certificate also evidences and entitles the holder hereof to
certain rights as set forth in the Rights Agreement between Brunswick
Corporation (the "Company") and Xxxxxx Trust and Savings Bank, dated
as of February 5, 1996 (the "Rights Agreement"), 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, 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 in effect on the date
of mailing, without charge promptly 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 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, shall become null and void.
Until the Distribution Date, the Rights associated with the Common Shares
shall be evidenced by the certificates representing the associated Common
Shares alone, and the transfer of any such certificate shall also
constitute the transfer of the Rights associated with the Common Shares
represented thereby. If the Company purchases or acquires any Common
Shares after the Record Date but prior to the Distribution Date, any Rights
associated with such Common Shares shall be deemed cancelled and retired so
that the Company shall not be entitled to exercise any Rights associated
with the Common Shares which are no longer outstanding.
Section 4. Form of Right Certificates.
(a) The Right Certificates (and the forms of election to purchase
Preferred Shares and of assignment to be printed on the reverse thereof)
shall each be substantially in the form set forth in 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 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 promulgated pursuant thereto or with any rule or
regulation of any stock exchange on which the Rights may from time to time
be listed, or to conform to usage. Subject to the provisions of Section 11
and Section 22 hereof, the Right Certificates shall entitle the holders
thereof to purchase such number of one one-thousandths of a Preferred Share
as shall be set forth therein at the price per one one-thousandth of a
Preferred Share set forth therein (the "Purchase Price"), but the amount
and type of securities purchasable upon the exercise of each Right and the
Purchase Price thereof shall be subject to adjustment as provided herein.
(b) Any Right 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 such Associate or Affiliate) who
becomes a transferee after the Acquiring Person becomes an Acquiring
Person, or (iii) a transferee of an Acquiring Person (or 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, whether written or oral, regarding the transferred Rights or
(B) a transfer which is part of a plan, arrangement or understanding,
whether written or oral, which has as a primary purpose or effect avoidance
of Section 7(e) hereof, and any Right Certificate issued pursuant to
Section 6 or Section 11 hereof upon transfer, exchange, replacement or
adjustment of any other Right Certificate referred to in this sentence,
shall contain (to the extent feasible and otherwise reasonably identifiable
as such) the following legend:
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 Associate of an Acquiring Person (as such terms
are defined in the Rights Agreement). Accordingly, this Right
Certificate and the Rights represented hereby may become void in the
circumstances specified in Section 7(e) of such Agreement.
The provisions of Section 7(e) shall apply whether or not any Right
Certificate actually contains the foregoing legend.
Section 5. Countersignature and Registration. The Right Certificates
shall be executed on behalf of the Company by its Chairman of the Board and
Chief Executive Officer, Senior Vice President and Chief Financial Officer
or any Vice President, either manually or by facsimile signature, shall
have affixed thereto the Company's seal or a facsimile thereof, and shall
be attested by the Secretary or an Assistant Secretary of the Company,
either manually or by facsimile signature. The Right 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 Right Certificates shall cease to be such officer of
the Company before countersignature by the Rights Agent and issuance and
delivery by the Company, such Right 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 Right
Certificates had not ceased to be such officer of the Company; and any
Right Certificate may be signed on behalf of the Company by any person who,
at the actual date of the execution of such Right Certificate, shall be a
proper officer of the Company to sign such Right Certificate, although at
the date of the execution of this Rights Agreement any such person was not
such an officer.
Following the Distribution Date, the Rights Agent will keep or cause
to be kept, at its office designated for such purpose, books for
registration and transfer of the Right Certificates issued hereunder. Such
books shall show the names and addresses of the respective holders of the
Right Certificates, the number of Rights evidenced on its face by each of
the Right Certificates and the date of each of the Right Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates.
(a) Subject to the provisions of Sections 4(b), 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 earlier of the Redemption
Date or the Final Expiration Date, any Right Certificate or Right
Certificates may be transferred, split up, combined or exchanged for
another Right Certificate or Right Certificates, entitling the registered
holder to purchase a like number of Preferred Shares (or, following a
Triggering Event, Common Shares, other securities or property, as the case
may be) as the Right Certificate or Right Certificates surrendered then
entitled such holder to purchase. Any registered holder desiring to
transfer, split up, combine or exchange any Right Certificate or Right
Certificates shall make such request in writing delivered to the Rights
Agent, and shall surrender the Right Certificate or Right Certificates to
be transferred, split up, combined or exchanged at the office of the Rights
Agent designated for such purpose. Neither the Rights Agent nor the
Company shall be obligated to take any action whatsoever with respect to
the transfer of any such surrendered Right Certificate until the registered
holder shall have completed and signed the certificate contained in the
form of assignment on the reverse side of such Right Certificate and the
Company shall have been provided with such additional evidence of the
identity of the Beneficial Owner (or former Beneficial Owner) or Affiliates
or Associates thereof as the Company shall reasonably request. Thereupon
the Rights Agent shall, subject to Sections 4 and 7 hereof, countersign and
deliver to the person entitled thereto a Right Certificate or Right
Certificates, as the case may be, as so requested. 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 Right Certificates.
(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 Right 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 Right Certificate if mutilated, the
Company will make and deliver a new Right Certificate of like tenor to the
Rights Agent for countersignature and delivery to the registered holder in
lieu of the Right Certificate so lost, stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price; Expiration Date of
Rights. (a) Subject to Section 7(e) hereof, the registered holder of any
Right Certificate may exercise the Rights evidenced thereby (except as
otherwise provided herein) in whole or in part at any time after the
Distribution Date upon surrender of the Right 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 Purchase Price with respect to each
surrendered Right for the total number of Preferred Shares (or other
securities or property, as the case may be) as to which the Rights are
exercised, at or prior to the earliest of (i) the close of business on
April 1, 2006 (the "Final Expiration Date"), (ii) the time at which the
Rights are redeemed as provided in Section 23 hereof (the "Redemption
Date") or (iii) the time at which such Rights are exchanged by the Company
as provided in Section 24 hereof.
(b) The Purchase Price for each one-thousandth of a Preferred Share
pursuant to the exercise of a Right shall initially be $85, 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 Right Certificate representing exercisable
Rights, with the form of election to purchase and the certificate on the
reverse side of the Right Certificate duly executed, accompanied by payment
of the Purchase Price for the shares (or other securities or property, 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 Right Certificate in
accordance with Section 9 hereof by certified check, cashier's check or
money order payable to the order of the Company, the Rights Agent shall
thereupon promptly (i) (A) requisition from any transfer agent of the
Preferred Shares (or make available, if the Rights Agent is the transfer
agent of the Preferred Shares) certificates for the number of Preferred
Shares 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 Preferred Shares issuable upon exercise
of the Rights with a depositary agent, requisition from the depositary
agent depositary receipts representing such number of one-thousandths of a
Preferred Share as are to be purchased (in which case certificates for the
Preferred Shares represented by such receipts shall be deposited by the
transfer agent therefor with the depositary agent) and the Company shall
direct 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
Right Certificate, registered in such name or names as may be designated by
such holder and (iv) when appropriate, after receipt, deliver such cash
referred to in clause (ii) above to or upon the order of the registered
holder of such Right Certificate. If the Company is obligated to issue
other securities (including Common Shares) of the Company, 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 property are available for distribution by the Rights Agent, if and
when appropriate.
(d) In case the registered holder of any Right Certificate shall
exercise less than all the Rights evidenced thereby, a new Right
Certificate evidencing Rights equivalent to the Rights remaining
unexercised shall be issued by the Rights Agent and delivered to the
registered holder of such Right Certificate or to his duly authorized
assigns, subject to the provisions of Section 14 hereof.
(e) Notwithstanding anything in this Agreement to the contrary, from
and after the 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 an Acquiring Person, or (iii) a transferee of an Acquiring Person
(or such Associate or Affiliate) who becomes a transferee prior to or
concurrently with the Acquiring Person becoming an Acquiring Person 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, whether written or
oral, regarding the transferred Rights or (B) a transfer which the Board of
Directors otherwise concludes in good faith is part of a plan, arrangement
or understanding (whether written or oral) which has as a primary purpose
or effect the avoidance of this Section 7(e), shall become null and void
without any further action, and any holder of such Rights shall thereupon
have no rights whatsoever with respect to such Rights, whether under any
provision of this Agreement or otherwise, from and after the occurrence of
a Triggering Event. The Company shall use all reasonable efforts to insure
that the provisions of this Section 7(e) hereof are complied with, but
shall have no liability to any holder of Rights with respect to any
determinations regarding an Acquiring Person or its Affiliates, Associates
or transferees hereunder or any failure to make any such determination.
(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 the certificate
contained in the form of election to purchase set forth on the reverse side
of the Right Certificate surrendered for such exercise shall have been
completed and signed by the registered holder thereof and the Company shall
have been provided with such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates
thereof as the Company shall reasonably request.
(g) The Company covenants and agrees that it will cause to be
reserved and kept available out of its authorized and unissued Preferred
Shares (and, following the occurrence of a Triggering Event, Common Shares
and/or other securities) or any Preferred Shares (and, following the
occurrence of a Triggering Event, Common Shares and/or other securities)
held in its treasury, the number of Preferred Shares (and, following the
occurrence of a Triggering Event, Common Shares and/or other securities)
that will be sufficient to permit the exercise in full of all outstanding
Rights.
(h) Notwithstanding any statement to the contrary contained in this
Agreement or in any Right Certificate, if both (i) either the Distribution
Date or the Shares Acquisition Date and (ii) either the "Final Expiration
Date" or the "Redemption Date," pursuant to and as defined in the Rights
Agreement, dated as of March 15, 1986, between the Company and the Rights
Agent, as amended, shall occur prior to the Record Date, the provisions of
this Agreement, including (without limitation) Sections 3 and 11(a)(ii),
shall be applicable to the Rights upon their issuance to the same extent
such provisions would have been applicable if the Record Date were the date
of this Agreement.
Section 8. Cancellation and Destruction of Right Certificates. All
Right 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
cancelled form, or, if surrendered to the Rights Agent, shall be cancelled
by it, and no Right Certificates shall be issued in lieu thereof except as
expressly permitted by any of the provisions of this Rights Agreement. The
Company shall deliver to the Rights Agent for cancellation and retirement,
and the Rights Agent shall so cancel and retire, any other Right
Certificate purchased or acquired by the Company otherwise than upon the
exercise thereof. The Rights Agent shall deliver all cancelled Right
Certificates to the Company, or shall, at the written request of the
Company, destroy such cancelled Right Certificates, and in such case shall
deliver a certificate of destruction thereof to the Company.
Section 9. Availability of Preferred Shares. The Company covenants
and agrees that it will take all such action as may be necessary to ensure
that all Preferred Shares (and, following the occurrence of a Triggering
Event, Common Shares and/or other securities) delivered upon exercise of
Rights shall, at the time of delivery of the certificates for such
Preferred Shares (and, following the occurrence of a Triggering Event,
Common Shares and/or other securities), subject to payment of the Purchase
Price, will be duly and validly authorized and issued and fully paid and
nonassessable shares.
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 issuance or delivery of the Right
Certificates or of any Preferred Shares (or Common Shares and/or other
securities, as the case may be) 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 Right Certificates to a
person other than, or the issuance or delivery of certificates or
depositary receipts for the Preferred Shares (or Common Shares and/or other
securities, as the case may be) in a name other than that of, the
registered holder of the Right Certificate evidencing Rights surrendered
for exercise or to issue or to deliver any certificates or depositary
receipts for Preferred Shares (or Common Shares and/or other securities, as
the case may be) upon the exercise of any Rights until any such tax shall
have been paid (any such tax being payable by the holder of such Right
Certificate at the time of surrender) or until it has been established to
the Company's reasonable satisfaction that no such tax is due.
Section 10. Preferred Shares Record Date. Each person in whose name
any certificate for Preferred Shares (or Common Shares and/or other
securities, as the case may be) is issued upon the exercise of Rights shall
for all purposes be deemed to have become the holder of record of the
shares or securities represented thereby on, and such certificate shall be
dated, the date upon which the Right Certificate evidencing such Rights was
duly surrendered and payment of the Purchase Price (and any applicable
transfer taxes) was made; provided, however, that if the date of such
surrender and payment is a date upon which the Preferred Shares (or Common
Shares and/or other securities, as the case may be) transfer books of the
Company are closed, such person shall be deemed to have become the record
holder of such shares or securities on, and such certificate shall be
dated, the next succeeding Business Day on which the Preferred Shares (or
Common Shares and/or other securities, as the case may be) transfer books
of the Company are open. Prior to the exercise of the Rights evidenced
thereby, the holder of a Right Certificate shall not be entitled to any
rights of a holder of Preferred Shares (or Common Shares and/or other
securities, as the case may be) 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.
Section 11. Adjustment of Purchase Price, Number of Shares or Number
of Rights. The Purchase Price, the number and kind of shares 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) If 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 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), except
as otherwise provided in this Section 11(a) and Section 7(e) hereof,
the Purchase Price in effect immediately prior to the record date for
such dividend or the effective date of such subdivision, combination
or reclassification, as applicable, and the number and kind of shares
of capital stock issuable on such date, shall be proportionately
adjusted so that the holder of any Right exercised after such time
shall be entitled to receive the aggregate number and kind of shares
of capital stock which he would have owned and been entitled to
receive if such Right had been exercised immediately prior to such
date and at a time when the Preferred Shares transfer books of the
Company were open; 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. If an event occurs which would
require an adjustment under both this Section 11(a)(i) and Section
11(a)(ii), the adjustment provided for in this Section 11(a)(i) shall
be in addition to, and shall be made prior to, any adjustment
required pursuant to Section 11(a)(ii).
(ii) Subject to Section 24 of this Agreement, if any Person
becomes an Acquiring Person, each holder of a Right, except as
provided below and in Section 7(e) hereof, shall thereafter have a
right to receive, upon exercise thereof at a price equal to the then
current Purchase Price multiplied by the number of one
one-thousandths of a Preferred Share for which a Right is then
exercisable, in accordance with the terms of this Agreement and in
lieu of Preferred Shares, such number of Common Shares of the Company
as shall equal the result obtained by (x) multiplying the then
current Purchase Price by the number of one one-thousandths of a
Preferred Share for which a Right is then exercisable and dividing
that product by (y) 50% of the then current per share market price of
the Company's Common Shares (determined pursuant to Section 11(d)
hereof) on the date of the occurrence of such event (such number of
Common Shares are referred to herein as the "Adjustment Shares"). If
any Person shall become an Acquiring Person and the Rights shall then
be outstanding, the Company shall not take any action which would
eliminate or diminish the benefits intended to be afforded by the
Rights.
(iii) In lieu of issuing Common Shares of the Company in
accordance with Section 11(a)(ii) hereof, the Company may, in the
sole discretion of the Board of Directors, elect to, and, if the
Board of Directors has not exercised the exchange right contained in
Section 24 hereof and there are not sufficient issued but not
outstanding and authorized but unissued Common Shares to permit the
exercise in full of the Rights in accordance with Section 11(a)(ii),
the Company shall: (A) determine the excess of (1) the value of the
Adjustment Shares issuable upon the exercise of a Right (the "Current
Value") over (2) the Purchase Price (such excess being the "Spread"),
and (B) with respect to each Right, make adequate provision to
substitute for such Adjustment Shares, upon payment of the applicable
Purchase Price, (1) cash, (2) a reduction of the Purchase Price, (3)
Common Shares or other equity securities of the Company, (4) debt
securities of the Company, (5) other assets, or (6) any combination
of the foregoing, having an aggregate value equal to the Current
Value, which aggregate value shall be determined by a majority of the
Board of Directors. For purposes of the preceding sentence, the
value of the Common Shares shall be determined pursuant to Section
11(d) hereof and the value of any equity securities which a majority
of the Board of Directors determines to be a "common stock
equivalent" (including the Preferred Shares, in such ratio as the
Board of Directors shall determine) shall be deemed to have the same
value as the Common Shares. Any such election by the Board of
Directors must be made and publicly announced within 60 days
following the date on which the event described in Section 11(a)(ii)
shall have occurred. Following the occurrence of the event described
in Section 11(a)(ii), a majority of the Board of Directors then in
office may suspend the exercisability of the Rights for a period of
up to 60 days following the date on which the event described in
Section 11(a)(ii) shall have occurred to the extent that such
directors have not determined whether to exercise the Company's right
of election under this Section 11(a)(iii). 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.
If the Company shall not have made adequate provision to deliver
value pursuant to clause (B) above within 60 days following the
occurrence of the event described in Section 11(a)(ii), then the
Company shall be obligated to deliver upon the surrender for exercise
of a Right and without requiring payment of the Purchase Price,
Common Shares (to the extent available) and then, if necessary, cash,
which Common Shares and/or cash shall have an aggregate value equal
to the Spread. To the extent that the Company determines that some
action need be taken pursuant to the first sentence of this Section
11(a)(iii), the Company shall provide, subject to Section 7(e), that
such action shall apply uniformly to all outstanding Rights.
(b) In case the Company shall fix a record date for the issuance of
rights, options or warrants to all holders of Preferred Shares entitling
them (for a period expiring within 45 calendar days after such record date)
to subscribe for or purchase Preferred Shares (or shares having the same
rights, privileges and preferences as the Preferred Shares ("equivalent
preferred shares")) or securities convertible into Preferred Shares or
equivalent preferred shares at a price per Preferred Share or equivalent
preferred share (or having a conversion price per share, if a security
convertible into Preferred Shares or equivalent preferred shares) less than
the then current per share market price of the Preferred Shares (as defined
in Section 11(d)) on such record date, the Purchase Price to be in effect
after such record date shall be determined by multiplying the Purchase
Price in effect immediately prior to such record date by a fraction, the
numerator of which shall be the number of Preferred Shares outstanding on
such record date plus the number of Preferred Shares which the aggregate
offering price of the total number of Preferred Shares and/or equivalent
preferred shares so to be offered (and/or the aggregate initial conversion
price of the convertible securities so to be offered) would purchase at
such current market price and the denominator of which shall be the number
of Preferred Shares outstanding on such record date plus the number of
additional Preferred Shares and/or equivalent preferred shares 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 Board of Directors of the Company,
whose determination shall be described in a statement filed with the Rights
Agent and shall be binding on the Rights Agent. Preferred 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 if such rights,
options or warrants are not so issued, the Purchase Price shall be adjusted
to be the Purchase Price which would then be in effect if such record date
had not been fixed.
(c) In case the Company shall fix a record date for the making of a
distribution to all holders of the Preferred 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 dividend payable in Preferred Shares
or a regular quarterly cash dividend) or subscription rights or warrants
(excluding those referred to in Section 11(b) hereof), the Purchase Price
to be in effect after such record date shall be determined by multiplying
the Purchase Price in effect immediately prior to such record date by a
fraction, the numerator of which shall be the then current per share market
price of the Preferred Shares on such record date, less the fair market
value (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 assets or evidences of indebtedness
so to be distributed or of such subscription rights or warrants applicable
to one Preferred Share and the denominator of which shall be such current
per share market price of the Preferred Shares; 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 to be issued upon exercise of one Right. Such adjustments shall be
made successively whenever such a record date is fixed; and if such
distribution is not so made, the Purchase Price shall again be adjusted to
be the Purchase Price which would then be in effect if such record date had
not been fixed.
(d) (i) For the purpose of any computation hereunder, other
than under Section 11(a)(iii) hereof, the "current per share market
price" of any security (a "Security" for the purpose of this Section
11(d)(i)) on any date shall be deemed to be the average of the daily
closing prices per share of such Security for the 30 consecutive
Trading Days (as such term is hereinafter defined) immediately prior
to such date, and for the purpose of any computation under Section
11(a)(iii) hereof, the "current per share market price" of a Security
on any date shall be deemed to be the average of the daily closing
prices per share of such Security for thirty (30) consecutive Trading
Days immediately following such date; provided, however, that if the
current per share market price of the Security is determined during a
period following the announcement by the issuer of such Security of
(A) a dividend or distribution on such Security payable in shares of
such Security or securities convertible into such shares (other than
the Rights), or (B) any subdivision, combination or reclassification
of such Security and prior to the expiration of 30 Trading Days 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 (ex-dividend) 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 quoted price or, if not so quoted, the average of the high
bid and low asked prices in the over-the-counter market, as reported
by the National Association of Securities Dealers, Inc. Automated
Quotation System ("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
Security on such date (as determined in good faith by the Board of
Directors of the Company) shall be used. The term "Trading Day"
shall mean a day on which the principal national securities exchange
on which the Security is listed or admitted to trading is open for
the transaction of business or, if the Security is not listed or
admitted to trading on any national securities exchange, a Business
Day.
(ii) For the purpose of any computation hereunder, the "current
per share market price" of the Preferred Shares shall be determined
in accordance with the method set forth in Section 11(d)(i). If the
Preferred Shares are not publicly traded, the "current per share
market price" of the Preferred Shares shall be conclusively deemed to
be the current per share market price of the Common Shares of the
Company as determined pursuant to Section 11(d)(i) (appropriately
adjusted to reflect any stock split, stock dividend or similar
transaction occurring after the date hereof), multiplied by one
thousand. If neither the Common Shares of the Company nor the
Preferred Shares are 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.
(e) Anything herein to the contrary notwithstanding, no adjustment
in the Purchase Price shall be required unless such adjustment would
require an increase or decrease of at least 1% in the Purchase Price;
provided, however, that any adjustments which by reason of this Section
11(e) 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 one-millionth of a
Preferred Share or one ten-thousandth of any other share or security, as
the case may be. Notwithstanding the first sentence of this Section 11(e),
any adjustment required by this Section 11 shall be made no later than the
earlier of (i) three years from the date of the transaction which requires
such adjustment or (ii) the date of the expiration of the right to exercise
any Rights.
(f) If as a result of an adjustment made pursuant to Section 11(a)
or Section 13(a) hereof, the holder of any Right thereafter exercised shall
become entitled to receive any shares of capital stock of the Company other
than Preferred Shares, thereafter the number of such other shares so
receivable upon exercise of any Right 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 this
Section 11, 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.
(g) All Rights originally issued by the Company subsequent to any
adjustment made to the Purchase Price hereunder shall evidence the right to
purchase, at the adjusted Purchase 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.
(h) Unless the Company shall have exercised its election as provided
in Section 11(i), upon each adjustment of the Purchase Price as a result of
the calculations made in Sections 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 Purchase Price, that number
of one-thousandths of a Preferred Share (calculated to the nearest
one-millionth of a Preferred Share) obtained by (i) multiplying (x) the
number of one-thousandths of a share covered by a Right immediately prior
to this adjustment by (y) the Purchase Price in effect immediately prior to
such adjustment of the Purchase Price and (ii) dividing the product so
obtained by the Purchase Price in effect immediately after such adjustment
of the Purchase Price.
(i) The Company may elect on or after the date of any adjustment of
the Purchase Price to adjust the number of Rights, in substitution for any
adjustment in the number of one-thousandths of a Preferred Share
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 ten-thousandth) obtained by
dividing the Purchase Price in effect immediately prior to adjustment of
the Purchase Price by the Purchase Price in effect immediately after
adjustment of the Purchase Price. The Company shall make a public
announcement of its election to adjust the number of Rights, indicating the
record date for the adjustment, and, if known at the time, the amount of
the adjustment to be made. This record date may be the date on which the
Purchase Price is adjusted or any day thereafter, but, if the Right
Certificates have been issued, shall be at least 10 days later than the
date of the public announcement. If Right Certificates have been issued,
upon each adjustment of the number of Rights pursuant to this Section
11(i), the Company shall, as promptly as practicable, cause to be
distributed to holders of record of Right Certificates on such record date
Right 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 Right
Certificates held by such holders prior to the date of adjustment, and upon
surrender thereof, if required by the Company, new Right Certificates
evidencing all the Rights to which such holders shall be entitled after
such adjustment. Right Certificates so to be distributed shall be issued,
executed and countersigned in the manner provided for herein and shall be
registered in the names of the holders of record of Right Certificates on
the record date specified in the public announcement.
(j) Irrespective of any adjustment or change in the Purchase Price
or the number of one-thousandths of a Preferred Share issuable upon the
exercise of the Rights, the Right Certificates theretofore and thereafter
issued may continue to express the Purchase Price and the number of
one-thousandths of a Preferred Share which were expressed in the initial
Right Certificates issued hereunder.
(k) Before taking any action that would cause an adjustment reducing
the Purchase Price below one-thousandth of the then par value, if any, of
the Preferred Shares 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 fully
paid and nonassessable Preferred Shares at such adjusted Purchase Price.
(l) In any case in which this Section 11 shall require that an
adjustment in the Purchase Price be made effective as of a record date for
a specified event, the Company may elect to defer until the occurrence of
such event the issuing to the holder of any Right exercised after such
record date of the Preferred Shares and other capital stock or securities
of the Company, if any, issuable upon such exercise over and above the
Preferred Shares and other capital stock or securities of the Company, if
any, issuable upon such exercise on the basis of the Purchase 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 upon the
occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary notwithstanding, the
Company shall be entitled to make such reductions in the Purchase 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 consolidation or subdivision of the Preferred
Shares, issuance wholly for cash of any Preferred Shares at less than the
current market price, issuance wholly for cash of Preferred Shares or
securities which by their terms are convertible into or exchangeable for
Preferred Shares, dividends on Preferred Shares payable in Preferred Shares
or issuance of rights, options or warrants referred to hereinabove in
Section 11(b), hereafter made by the Company to holders of its Preferred
Shares shall not be taxable to such stockholders.
(n) If at any time after the date of this Agreement and prior to the
Distribution Date, the Company shall (i) declare or pay any dividend on the
Common Shares payable in Common Shares or (ii) effect a subdivision,
combination or consolidation of the Common Shares (by reclassification or
otherwise than by payment of dividends in Common Shares) into a greater or
lesser number of Common Shares, then in any such case (i) the number of
one-thousandths of a Preferred Share purchasable after such event upon
proper exercise of each Right shall be determined by multiplying the number
of one-thousandths of a Preferred Share so purchasable immediately prior to
such event by a fraction, the numerator of which is the number of Common
Shares outstanding immediately before such event and the denominator of
which is the number of Common Shares outstanding immediately after such
event, and (ii) each Common Share outstanding immediately after such event
shall have issued with respect to it that number of Rights which each
Common Share outstanding immediately prior to such event had issued with
respect to it. The adjustments provided for in this Section 11(n) shall be
made successively whenever such a dividend is declared or paid or such a
subdivision, combination or consolidation is effected.
(o) So long as the shares issuable upon the exercise of the Rights
may be listed on any national securities exchange, the Company shall use
its best efforts to cause, from and after such time as the Rights become
exercisable, all shares reserved for such issuance to be listed on such
exchange upon official notice of issuance upon such exercise.
(p) The Company shall use its best efforts to (i) file, as soon as
practicable following the first occurrence of a Triggering Event, 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 date of the expiration of the
Rights. The Company will also take such action with respect thereto as may
be appropriate under the blue sky laws of the various states. The Company
may temporarily suspend, for a period of time not to exceed 90 days, the
exercisability of the Rights in order to prepare and file such registration
statement or in order to comply with such blue sky laws. Upon any such
suspension, the Company shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended.
Section 12. Certificate of Adjusted Purchase Price or Number of
Shares. Whenever an adjustment is made as provided in Section 11 or 13
hereof, the Company shall promptly (a) prepare a certificate setting forth
such adjustment, and a brief statement of the facts accounting for such
adjustment, (b) file with the Rights Agent and with each transfer agent for
the Common Shares or the Preferred Shares a copy of such certificate and
(c) mail a brief summary thereof to each holder of a Right Certificate in
accordance with Section 25 hereof. The Rights Agent shall be fully
protected in relying on any such certificate and on any adjustment therein
contained and may assume that no adjustment has been made unless and until
it shall have received such certificate.
Section 13. Consolidation, Merger or Sale or Transfer of Assets or
Earning Power.
(a) If after the Shares Acquisition Date, directly or indirectly,
(x) the Company shall consolidate with, or merge with and into, any other
Person, (y) 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 merger and, in connection with such merger, all or part
of the Common Shares shall be changed into or exchanged for stock or other
securities of any other Person (or the Company) or cash or any other
property, or (z) 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 Person or Persons other than the Company or one or more of its
wholly-owned Subsidiaries, then, and in each such case, proper provision
shall be made so that (i) each holder of a Right (except as otherwise
provided herein) shall thereafter have the right to receive, upon the
exercise thereof at a price equal to the then current Purchase Price
multiplied by the number of one-thousandths of a Preferred Share for which
a Right is then exercisable, in accordance with the terms of this Agreement
and in lieu of Preferred Shares, such number of validly authorized and
issued, fully paid, non-assessable and freely tradeable Common Shares of
the Principal Party (as hereinafter defined), free and clear of all liens,
rights of call or first refusal, encumbrances or other adverse claims, as
shall equal the result obtained by (A) multiplying the then current
Purchase Price by the number of one-thousandths of a Preferred Share for
which a Right is then exercisable (or, if such Right is not then
exercisable for a number of one-thousandths of a Preferred Share, the
number of such fractional shares for which it was exercisable immediately
prior to an event described under Section 11(a)(ii) hereof) and dividing
that product by (B) 50% of the then current per share market price of the
Common Shares of such Principal Party (determined pursuant to Section 11(d)
hereof) on the date of consummation of such consolidation, merger, sale or
transfer; (ii) such Principal Party shall thereafter be liable for, and
shall assume, by virtue of such consolidation, merger, sale or transfer, or
otherwise, all the obligations and duties of the Company pursuant to this
Agreement; (iii) the term "Company" shall thereafter be deemed to refer to
such Principal Party and (iv) such Principal Party shall take such steps
(including, but not limited to, the reservation of a sufficient number of
its Common Shares in accordance with Section 9 hereof) in connection with
such consummation as may be necessary to assure that the provisions hereof
shall thereafter be applicable, as nearly as reasonably may be, in relation
to its Common Shares thereafter deliverable upon the exercise of the
Rights.
(b) "Principal Party" shall mean:
(i) In the case of any transaction described in (x) or (y) of
the first sentence of Section 13(a), the Person that is the issuer of
any securities into which Common Shares of the Company are converted
in such merger or consolidation, and if no securities are so issued,
the Person that is the surviving entity of such merger or
consolidation (including the Company if applicable); and
(ii) in the case of any transaction described in (z) of the
first sentence in Section 13(a), the Person that is the party
receiving the greatest portion of the assets or earning power
transferred pursuant to such transaction or transactions;
provided, however, that in any such case described in clauses (b)(i) and
(b)(ii): (1) if the Common Shares of such Person are not at such time and
have not been continuously over the preceding 12-month period registered
under Section 12 of the Exchange Act, and such Person is a direct or
indirect Subsidiary of another Person the Common Shares of which is and has
been so registered, "Principal Party" shall refer to such other Person; (2)
in case such Person is a Subsidiary, directly or indirectly, of more than
one Person, the Common Shares of two or more of which are and have been so
registered, "Principal Party" shall refer to whichever of such Persons is
the issuer of the Common Shares having the greatest aggregate market value;
and (3) in case 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 (1) and (2) above
shall apply to each of the chains of ownership having an interest in such
joint venture as if such party were a "Subsidiary" of both or all of such
joint venturers and the Principal Parties in each such chain shall bear the
obligations set forth in this Section 13 in the same ratio as their direct
or indirect interests in such Person bear to the total of such interests.
(c) The Company shall not consummate any such consolidation, merger,
sale or transfer unless the Principal Party shall have sufficient Common
Shares authorized to permit the full exercise of the Rights and prior
thereto the Company and such Principal Party 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 or sale of assets mentioned in paragraph (a) of this Section 13, the
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, and
will use its best efforts to cause such registration statement to (A)
become effective as soon as practicable after such filing and (B)
remain effective (with a prospectus at all times meeting the
requirements of the Securities Act) until the Expiration Date;
(ii) deliver to holders of the Rights historical financial
statements for the Principal Party and each of its Affiliates which
comply in all respects with the requirements for registration on Form
10 under the Exchange Act; and
(iii) take such actions as may be necessary or appropriate
under the blue sky laws of the various states. The provisions of
this Section 13 shall similarly apply to successive mergers or
consolidations or sales or other transfers. If one of the
transactions described in this Section 13(a) shall occur at any time
after the occurrence of a transaction described in Section 11(a)(ii)
hereof, the Rights which have not theretofore been exercised shall
thereafter become exercisable in the manner described in Section
13(a).
Section 14.Fractional Rights and Fractional Shares. (a) The Company
shall not be required to issue fractions of Rights or to distribute Right
Certificates which evidence fractional Rights. In lieu of such fractional
Rights, there may be paid to the registered holders of the Right
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. The closing price
for any 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 Rights are
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 Rights are listed or admitted to trading or, if the Rights are
not listed or admitted to trading on any national securities exchange, the
last quoted price or, if not so quoted, 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 Rights are 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 Rights
selected by the Board of Directors of the Company. If on any such date no
such market maker is making a market in the Rights, the fair value of the
Rights on such date as determined in good faith by the Board of Directors
of the Company shall be used.
(b) The Company shall not be required to issue fractions of
Preferred Shares (other than fractions which are integral multiples of
one-thousandth of a Preferred Share) upon exercise of the Rights or to
distribute certificates which evidence fractional Preferred Shares (other
than fractions which are integral multiples of one-thousandth of a
Preferred Share). Fractions of Preferred Shares in integral multiples of
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 Shares that are not integral
multiples of one-thousandth of a Preferred Share, the Company may pay to
the registered holders of Right 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 one-thousandth of a Preferred Share. For
the purposes of this Section 14(b), the current market value of
one-thousandth of a Preferred Share shall be one-thousandth of the closing
price of a Preferred Share (as determined pursuant to the second sentence
of Section 11(d)(i) hereof) for the Trading Day immediately prior to the
date of such exercise.
(c) Following the occurrence of a Triggering Event, the Company
shall not be required to issue fractions of Common Shares upon exercise of
the Rights or to distribute certificates which evidence fractional Common
Shares. In lieu of fractional Common Shares, the Company may pay to the
registered holders of Right 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 one Common Share. For purposes of this
Section 14(c), the current market value of one Common Share shall be the
closing price of one Common Share (as determined pursuant to the second
sentence of Section 11(d)(i) 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 right to receive any fractional Rights or any fractional shares
upon exercise of a Right (except as provided above).
Section 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 hereof, are vested in the respective registered holders of the
Right Certificates (and, prior to the Distribution Date, the registered
holders of the Common Shares); and any registered holder of any Right
Certificate (or, prior to the Distribution Date, of the Common Shares),
without the consent of the Rights Agent or of the holder of any other Right
Certificate (or, prior to the Distribution Date, of the Common Shares),
may, in his own behalf and for his 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 right to exercise the Rights evidenced
by such Right Certificate in the manner provided in such Right 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.
Section 16.Agreement of Right 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 Common Shares;
(b) after the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if surrendered
at the office of the Rights Agent designated for such purposes, duly
endorsed or accompanied by a proper instrument of transfer and with
appropriate forms and certificates fully executed;
(c) the Company and the Rights Agent may deem and treat the person
in whose name the Right Certificate (or, prior to the Distribution Date,
the associated Common Shares certificate) is registered as the absolute
owner thereof and of the Rights evidenced thereby (notwithstanding any
notations of ownership or writing on the Right Certificates or the
associated Common Shares 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; and
(d) 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 any 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, decree or ruling issued
by a court of competent jurisdiction or by a governmental, 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.
Section 17.Right Certificate Holder Not Deemed a Stockholder. No
holder, as such, of any Right Certificate shall be entitled to vote,
receive dividends or be deemed for any purpose 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 Right Certificate be construed to
confer upon the holder of any Right Certificate, as such, any of the rights
of a stockholder of the Company or any right to vote for the election of
directors or upon any matter submitted to stockholders at any meeting
thereof, or to give or withhold consent to any corporate action, or to
receive notice of meetings or other actions affecting stockholders (except
as provided in Section 25 hereof), or to receive dividends or subscription
rights, or otherwise, until the Right or Rights evidenced by such Right
Certificate shall have been exercised in accordance with the provisions
hereof.
Section 18.Concerning the Rights Agent. 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 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,
or expense, incurred without negligence, bad faith or willful misconduct on
the part of the Rights Agent, for anything done or omitted by the Rights
Agent in connection with the acceptance and administration of this
Agreement, including the costs and expenses of defending against any claim
of liability in the premises.
The Rights Agent shall be protected and shall incur no liability for,
or in respect of any action taken, suffered or omitted by it in connection
with, its administration of this Agreement in reliance upon any Right
Certificate or certificate for the Preferred Shares or Common Shares 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.
Section 19.Merger or Consolidation or Change of Name of Rights Agent.
Any corporation into which the Rights Agent or any successor Rights Agent
may be merged or with which it may be consolidated, or any corporation
resulting from any merger or consolidation to which the Rights Agent or any
successor Rights Agent shall be a party, or any corporation succeeding to
the stock transfer or 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, that such
corporation 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 Right 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 Right
Certificates so countersigned; and in case at that time any of the Right
Certificates shall not have been countersigned, any successor Rights Agent
may countersign such Right 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 Right Certificates shall have the full force
provided in the Right 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 Right Certificates shall have been countersigned
but not delivered, the Rights Agent may adopt the countersignature under
its prior name and deliver Right Certificates so countersigned; and in case
at that time any of the Right Certificates shall not have been
countersigned, the Rights Agent may countersign such Right Certificates
either in its prior name or in its changed name; and in all such cases such
Right Certificates shall have the full force provided in the Right
Certificates and in this Agreement.
Section 20.Duties of Rights Agent. The Rights Agent undertakes the
duties and obligations imposed by this Agreement upon the following terms
and conditions, by all of which the Company and the holders of Right
Certificates, by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel (who may be
legal counsel for the Company), and the opinion of such counsel shall be
full and complete authorization and protection to the Rights Agent as to
any action taken or omitted by it in good faith and in accordance with such
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 be proved or established by the Company prior to taking or suffering
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 President
and Chief Executive Officer, Executive Vice President and Chief Operating
Officer, Senior Vice President and Chief Financial Officer, any Vice
President or the Secretary of the Company and delivered to the Rights
Agent; and such certificate shall be full authorization to the Rights Agent
for any action taken or suffered in good faith 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, and shall indemnify and hold harmless the
Company from and against, any and all losses, liabilities, costs, damages
and expenses (including attorneys' fees) arising out of or in connection
with, the Rights Agent's negligence, bad faith or willful misconduct.
(d) 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
Right 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.
(e) The Rights Agent shall not 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 Right 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 Right Certificate; nor shall it be responsible for any change in the
exercisability of the Rights (including the Rights becoming void pursuant
to Section 7(e) hereof) or any adjustment in the terms of the Rights
(including the manner, method or amount thereof) provided for in Section 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 Right Certificates after receipt of a certificate
furnished pursuant to Section 12 describing a change or adjustment); 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 or
Common Shares to be issued pursuant to this Agreement or any Right
Certificate or as to whether any Preferred Shares or Common Shares will,
when issued, be validly authorized and issued, fully paid and
nonassessable.
(f) The Company agrees that it will perform, execute, acknowledge
and deliver or cause to be performed, executed, acknowledged and delivered
all such further and 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.
(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 President and Chief Executive Officer, Executive Vice
President and Chief Operating Officer, Senior Vice President and Chief
Financial Officer, Vice President and Treasurer, any Vice President or the
Secretary of the Company, and to apply to such officers for advice or
instructions in connection with its duties, and it shall not be liable for
any action taken or suffered by it in good faith in accordance with
instructions of any such officer or for any delay in acting while waiting
for those instructions. 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 or omitted by the Rights
Agent under this Rights Agreement and the date on and/or after which such
action shall be taken or such omission shall be effective. The Rights
Agent shall not be liable for any action taken 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 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 stockholder, 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 its Subsidiaries or become pecuniarily
interested in any transaction in which the Company or its Subsidiaries may
be interested, or contract with or lend money to the Company or its
Subsidiaries or otherwise act as fully and freely as though it were not
Rights Agent under this Agreement. Nothing herein shall preclude the
Rights Agent from acting in any other capacity for the Company or its
Subsidiaries or for any other legal entity.
(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 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 resulting from
any such act, default, neglect or misconduct, provided reasonable care was
exercised in the selection and continued employment thereof.
(j) If, with respect to any Right 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.
Section 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 30 days' notice in writing mailed to the Company and to each
transfer agent of the Common Shares or Preferred Shares by registered or
certified mail, and to the holders of the Right Certificates by first-class
mail. The Company may remove the Rights Agent or any successor Rights
Agent upon 30 days' notice in writing, mailed to the Rights Agent or
successor Rights Agent, as the case may be, and to each transfer agent of
the Common Shares or Preferred Shares by registered or certified mail, and
to the holders of the Right 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 30 days
after giving notice of such removal or after it has been notified in
writing of such resignation or incapacity by the resigning or incapacitated
Rights Agent or by the holder of a Right Certificate (who shall, with such
notice, submit his Right Certificate for inspection by the Company), then
the registered holder of any Right 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 corporation or bank organized and doing business under
the laws of the United States or of any other state of the United States,
which is authorized under such laws to exercise corporate trust or stock
transfer powers and is subject to supervision or examination by federal or
state authority and which, at the time of its appointment as Rights Agent,
(a) has a combined capital and surplus of at least $100 million or (b) is
an affiliate of an entity having a combined capital and surplus of at least
$100 million. 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 Common Shares or Preferred Shares, and
mail a notice thereof in writing to the registered holders of the Right
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.
Section 22.Issuance of New Right Certificates. Notwithstanding any
of the provisions of this Agreement or of the Rights to the contrary, the
Company may, at its option, issue new Right Certificates evidencing Rights
in such form as may be approved by its Board of Directors to reflect any
adjustment or change in the Purchase Price and the number or kind or class
of shares or other securities or property purchasable under the Right
Certificates made in accordance with the provisions of this Agreement.
Section 23. Redemption.
(a) The Board of Directors of the Company may, at its option, at any
time prior to such time as any Person becomes an Acquiring Person, redeem
all but not less than all the then outstanding Rights at a redemption price
of $.01 per Right, appropriately adjusted to reflect any stock split, stock
dividend or similar transaction occurring after the date hereof (such
redemption price being hereinafter referred to as the "Redemption Price").
The Company may, at its option, pay the Redemption Price in cash, Common
Shares (based on the current per share market price of the Common Shares at
the time of redemption) or any other form of consideration deemed
appropriate by the Board of Directors. The redemption of the Rights by the
Board of Directors 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. If redemption of the Rights is to be effective as of a future
date, the Rights shall continue to be exercisable, subject to Section 7
hereof, until the effective date of the redemption, provided that nothing
contained herein shall preclude the Board of Directors from subsequently
causing the Rights to be redeemed at a date earlier than the scheduled
effective date of the redemption.
(b) Immediately upon the action of the Board of Directors of the
Company ordering the redemption of the Rights (or at the effective time of
such redemption established by the Board of Directors of the Company
pursuant to paragraph (a) of this Section 23), 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 10 days after such action of the Board of Directors
ordering the redemption of the Rights or, if later, the effectiveness of
the redemption of the Rights pursuant to the last sentence of paragraph
(a), the Company shall mail a notice of redemption to all the holders of
the then outstanding Rights 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 Shares. 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. The Company may, at its option, discharge all of its
obligations with respect to the Rights by (i) issuing a press release
announcing the manner of redemption of the Rights, (ii) depositing with a
bank or trust company having a capital and surplus of at least
$100,000,000, funds necessary for such redemption, in trust, to be applied
to the redemption of the Rights so called for redemption and (iii)
arranging for the mailing of the Redemption Price to the registered holders
of the Rights. Upon such action, all outstanding Right Certificates shall
be null and void without further action by the Company. 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, in Section 24 hereof, or in
connection with the purchase of Common Shares prior to the Distribution
Date.
Section 24. Exchange. (a) The Company may, at any time prior to the
Distribution Date, upon resolution of a majority of the Board of Directors,
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 Common Shares at an exchange ratio specified in
the following sentence, appropriately adjusted to reflect any stock split,
stock dividend or similar transaction occurring after the date hereof.
Upon such resolution each Right may be exchanged for that number of Common
Shares obtained by dividing the Adjustment Spread (as defined below) by the
then current market price (determined pursuant to Section 11(d) hereof) per
Common Share (such exchange ratio being the "Exchange Ratio") on the
earlier of (i) the date on which any Person becomes an Acquiring Person and
(ii) the date of the commencement 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 entity holding Common Shares for or
pursuant to the terms of any such plan) of, or of the first public
announcement of the intention of 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 entity holding Common Shares for or
pursuant to the terms of any such plan) to commence, a tender or exchange
offer the consummation of which would result in any Person becoming the
Beneficial Owner of Common Shares aggregating 15% or more of the then
outstanding Common Shares. The "Adjustment Spread" shall equal (x) the
product of (1) the market price per Common Share on the date of such event
times (2) the number of Adjustment Shares (provided that if the date of
such calculation is the date of an event as described in clause (ii) above,
the Adjustment Shares shall be calculated pursuant to Section 11(a)(ii) as
if a Person became an Acquiring Person on such date) minus (y) the Purchase
Price.
(b) Immediately upon the action of the Board of Directors of the
Company ordering the exchange of any Rights pursuant to paragraph (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 Common Shares
equal to the number of such Rights held by such holder multiplied by the
Exchange Ratio. The Company shall promptly give public notice of any such
exchange; provided, however, that the failure to give, or any defect in,
such notice shall not affect the validity of such exchange. The Company
promptly 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 Common Shares 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 any exchange pursuant to this Section 24, the Company, at its
option, may substitute Preferred Shares (or equivalent preferred shares, as
such term is defined in Section 11(b) hereof) for Common Shares
exchangeable for Rights, at the initial rate of one-thousandth of a
Preferred Share (or equivalent preferred share) for each Common Share, as
appropriately adjusted to reflect adjustments in the voting rights of the
Preferred Shares pursuant to the terms thereof, so that the fraction of a
Preferred Share delivered in lieu of each Common Share shall have the same
voting rights as one Common Share.
(d) If there shall not be sufficient Common Shares or Preferred
Shares issued but not outstanding or authorized but unissued to permit any
exchange of Rights as contemplated in accordance with this Section 24, the
Company shall take all such action as may be necessary to authorize
additional Common Shares or Preferred Shares for issuance upon exchange of
the Rights or make adequate provision to substitute (1) cash, (2) equity
securities of the Company, (3) debt securities of the Company, (4) other
assets or (5) any combination of the foregoing.
(e) The Company shall not be required to issue fractions of Common
Shares or to distribute certificates which evidence fractional Common
Shares. In lieu of such fractional Common Shares, the Company shall pay to
the registered holders of the Right Certificates with regard to which such
fractional Common Shares would otherwise be issuable an amount in cash
equal to the same fraction of the current market value of a whole Common
Share. For the purposes of this paragraph (e), the current market value of
a whole Common Share shall be the closing price of a Common Share (as
determined pursuant to the second sentence of Section 11(d)(i) hereof) for
the Trading Day immediately prior to the date of exchange pursuant to this
Section 24.
Section 25. Notice of Certain Events.
(a) In case the Company shall propose at any time after the
Distribution Date (i) to pay any dividend payable in stock of any class to
the holders of its Preferred Shares or to make any other distribution to
the holders of its Preferred Shares (other than a regular quarterly cash
dividend), (ii) to offer to the holders of its Preferred Shares rights or
warrants to subscribe for or to purchase any additional Preferred Shares or
shares of stock of any class or any other securities, rights or options,
(iii) to effect any reclassification of its Preferred Shares (other than a
reclassification involving only the subdivision of outstanding Preferred
Shares), (iv) to effect any consolidation or merger into or with, or to
effect any sale or other transfer (or to permit one or more of its
Subsidiaries to effect any sale or other transfer), in one or more
transactions, of 50% or more of the assets or earning power of the Company
and its Subsidiaries (taken as a whole) to, any other Person, (v) to effect
the liquidation, dissolution or winding up of the Company, or (vi) to
declare or pay any dividend on the Common Shares payable in Common Shares
or to effect a subdivision, combination or consolidation of the Common
Shares (by reclassification or otherwise than by payment of dividends in
Common Shares), then, in each such case, the Company shall give to each
holder of a Right Certificate, in accordance with Section 26 hereof, a
notice of such proposed action, which shall specify the record date for the
purposes of such stock dividend, or distribution of rights or warrants, or
the date on which such reclassification, consolidation, merger, sale,
transfer, liquidation, dissolution, or winding up is to take place and the
date of participation therein by the holders of the Common Shares and/or
Preferred Shares, if any such date is to be fixed, and such notice shall be
so given in the case of any action covered by clause (i) or (ii) above at
least 10 days prior to the record date for determining holders of the
Preferred Shares for purposes of such action, and in the case of any such
other action, at least 10 days prior to the date of the taking of such
proposed action or the date of participation therein by the holders of the
Common Shares and/or Preferred Shares, whichever shall be the earlier.
(b) In case the event set forth in Section 11(a)(ii) hereof shall
occur, then the Company shall as soon as practicable thereafter give to
each holder of a Right Certificate, in accordance with Section 26 hereof, a
notice of the occurrence of such event, which notice shall describe such
event and the consequences of such event to holders of Rights under Section
11(a)(ii) hereof.
Section 26.Notices. Notices or demands authorized by this Agreement
to be given or made by the Rights Agent or by the holder of any Right
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:
Brunswick Corporation
0 Xxxxx Xxxxx Xxxxx
Xxxx Xxxxxx, Xxxxxxxx 00000
Attention: Secretary
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 Right 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:
Xxxxxx Trust and Savings Bank
000 Xxxx Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Right Certificate shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed to such holder at the address of such holder as shown on the
registry books of the Company.
Section 27.Supplements and Amendments. The Company may from time to
time supplement or amend this Agreement without the approval of any holders
of Right Certificates in order to cure any ambiguity, to correct or
supplement any provision contained herein which may be defective or
inconsistent with any other provisions herein, or to make any other
provisions with respect to the Rights which the Company may deem necessary
or desirable, any such supplement or amendment to be evidenced by a writing
signed by the Company and the Rights Agent; provided, however, that from
and after such time as any Person becomes an Acquiring Person, this
Agreement shall not be amended in any manner which would adversely affect
the interests of the holders of Rights.
Section 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.
Section 29.Benefits of this Agreement. Nothing in this Agreement
shall be construed to give to any person or corporation other than the
Company, the Rights Agent and the registered holders of the Right
Certificates (and, prior to the Distribution Date, the Common Shares) 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 Right Certificates (and,
prior to the Distribution Date, the Common Shares).
Section 30.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.
Section 31.Governing Law. This Agreement and each Right Certificate
issued hereunder shall be deemed to be a contract made under the laws of
the State of Delaware 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.
Section 32.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 sane instrument.
Section 33.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.
Section 34.Determinations and Actions by the Board of Directors. 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, interpretations and determinations
(including, for purpose of clause (ii) below, all omissions with respect to
the foregoing) which are done or made by the Board in good faith, shall (i)
be final, conclusive and binding on the Company, the Rights Agent, the
holders of the Right Certificates and all other parties, and (ii) not
subject the Board of Directors to any liability to the holders of the Right
Certificates.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and attested, all as of the day and year first above written.
Attest: BRUNSWICK CORPORATION
By:_______________________________ By: _______________________________
Name: Xxxxxx X. Xxxxxxxxx Name: Xxxxx X. Xxxxxxxx
Title: Vice President-Administration Title: Senior Vice President and
and Corporate Secretary Chief Financial Officer
Attest: XXXXXX TRUST AND SAVINGS BANK
By:_______________________________By: _______________________________
Name: X.X. Xxxx Name: Xxxxxx X. Xxxxxx
Title: Assistant Secretary Title: Vice President
Exhibit A
FORM OF
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS
OF SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
of
Brunswick Corporation
Pursuant to Section 151 of the General Corporation Law
of the State of Delaware
We, Xxxxx X. Xxxxxxxx, Senior Vice President and Chief Financial
Officer, and Xxxxxx X. Xxxxxxxxx, Vice President-Administration and
Corporate Secretary of Brunswick Corporation, a corporation organized and
existing under the General Corporation Law of the State of Delaware (the
"Corporation"), in accordance with the provisions of Section 103 thereof,
DO HEREBY CERTIFY:
That pursuant to the authority conferred upon the Board of Directors
by the Certificate of Incorporation, as amended, of the Corporation, the
Board of Directors on February 5, 1996 adopted the following resolution
creating a series of 150,000 shares of preferred stock designated as Series
A Junior Participating Preferred Stock:
RESOLVED, that pursuant to the authority vested in the Board of
Directors of the Corporation in accordance with the provisions of its
Certificate of Incorporation, as amended, a series of preferred stock, par
value $0.75 per share, of the Corporation (such preferred stock being
herein referred to as "Preferred Stock," which term shall include any
additional shares of preferred stock of the same class heretofore or
hereafter authorized to be issued by the Corporation), consisting of
150,000 shares is hereby created, and the voting powers, preferences and
relative, participating, optional or other special rights, and the
qualifications, limitations or restrictions thereof, are as follows:
Section 1. Designation and Amount. There shall be a series of
Preferred Stock of the Corporation which shall be designated as "Series A
Junior Participating Preferred Stock," par value $0.75 per share
(hereinafter called "Series A Junior Preferred Stock"), and the number of
shares constituting such series shall be 150,000. Such number of shares
may be increased or decreased by resolution of the Board of Directors and
by the filing of a certificate pursuant to the provisions of the General
Corporation Law of the State of Delaware stating that such increase or
reduction has been so authorized; provided, however, that no decrease shall
reduce the number of shares of Series A Junior Preferred Stock to a number
less than that of the shares then outstanding plus the number of shares of
Series A Junior Preferred Stock issuable upon exercise of outstanding
rights, options or warrants or upon conversion of outstanding securities
issued by the Corporation.
Section 2. Dividends and Distributions.
(A) Subject to the prior and superior rights of the holders of any
shares of any series of Preferred Stock ranking prior and superior to the
shares of Series A Junior Preferred Stock with respect to dividends, the
holders of shares of Series A Junior Preferred Stock shall be entitled to
receive, when, as and if declared by the Board of Directors out of funds
legally available for such purpose, quarterly dividends payable in cash to
holders of record on the last business day of March, June, September and
December 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 Junior Preferred Stock, in an amount per share (rounded
to the nearest cent) equal to the greater of (a) $1.00 and (b) subject to
the provision for adjustment hereinafter set forth, 1000 times the
aggregate per share amount of all cash dividends, and 1000 times the
aggregate per share amount (payable in kind) of all non-cash dividends or
other distributions other than a dividend payable in shares of Common Stock
(hereinafter defined) or a subdivision of the outstanding shares of Common
Stock (by reclassification or otherwise), declared on the Common Stock, par
value $0.75 per share, of the Corporation (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 Junior Preferred Stock. If the
Corporation shall at any time following February 5, 1996 (i) declare any
dividend on 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 amount to which
holders of shares of Series A Junior Preferred Stock were entitled
immediately prior to such event under clause (b) of the preceding sentence
shall be adjusted by multiplying each such amount by a fraction the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such
event.
(B) The Corporation shall declare a dividend or distribution on the
Series A Junior Preferred Stock as provided in paragraph (A) above at the
time it declares a dividend or distribution on the Common Stock (other than
a dividend payable in shares of Common Stock).
(C) No dividend or distribution (other than a dividend payable in
shares of Common Stock) shall be paid or payable to the holders of shares
of Common Stock unless, prior thereto, all accrued but unpaid dividends to
the date of such dividend or distribution shall have been paid to the
holders of shares of Series A Junior Preferred Stock.
(D) Dividends shall begin to accrue and be cumulative on outstanding
shares of Series A Junior Preferred Stock from the Quarterly Dividend
Payment Date next preceding the date of issue of such shares of Series A
Junior 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 Junior 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 and be cumulative from
such Quarterly Dividend Payment Date. Accrued but unpaid dividends shall
not bear interest. Dividends paid on the shares of Series A Junior
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 of Directors may fix a record date for the determination of
holders of shares of Series A Junior 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 3. Voting Rights. The holders of shares of Series A Junior
Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set forth,
each one one-thousandth of a share of Series A Junior Preferred Stock shall
entitle the holder thereof to one vote on all matters submitted to a vote
of the stockholders of the Corporation. If the Corporation shall at any
time following February 5, 1996 (i) declare any dividend on Common Stock
payable in shares of Common Stock, (ii) subdivide the outstanding shares of
Common Stock or (iii) combine the outstanding Common Stock into a smaller
number of shares, then in each such case the number of votes per share to
which holders of shares of Series A Junior Preferred Stock were entitled
immediately prior to such event shall be adjusted by multiplying such
number by a fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the denominator
of which is the number of shares of Common Stock that were outstanding
immediately prior to such event.
(B) Except as otherwise provided herein or by law, the holders of
shares of Series A Junior Preferred Stock and the holders of shares of
Common Stock and any other capital stock of the Corporation having general
voting rights shall vote together as one class on all matters submitted to
a vote of stockholders of the Corporation.
(C) (i) Whenever, at any time or times, dividends payable on any
share or shares of Series A Junior Preferred Stock shall be in
arrears in an amount equal to at least six full quarterly dividends
(whether or not declared and whether or not consecutive), the holders
of record of the outstanding Preferred Stock shall have the exclusive
right, voting separately as a single class, to elect a total of two
directors of the Corporation. Such two directors shall be elected
initially at a special meeting of stockholders of the Corporation or
at the Corporation's next annual meeting of stockholders, and
subsequently at each annual meeting of stockholders, as provided
below. The term of office of the two directors so elected shall end
on the date of the annual meeting following such election. At
elections for such directors, the holders of shares of Series A
Junior Preferred Stock shall be entitled to cast one vote for each
one one-thousandth of a share of Series A Junior Preferred Stock
held.
(ii) Upon the vesting of such right of the holders of the
Preferred Stock, the maximum authorized number of members of the
Board of Directors shall automatically be increased by two and the
two vacancies so created shall be filled by vote of the holders of
the outstanding Preferred Stock as hereinafter set forth. A special
meeting of the stockholders of the Corporation then entitled to vote
shall be called by the Chairman or the President or the Secretary of
the Corporation, if requested in writing by the holders of record of
not less than 10% of the Preferred Stock then outstanding. At such
special meeting, or, if no such special meeting shall have been
called, then at the next annual meeting of stockholders of the
Corporation, the holders of the shares of the Preferred Stock shall
elect, voting as above provided, two directors of the Corporation to
fill the aforesaid vacancies created by the automatic increase in the
number of members of the Board of Directors. The term of office of
the two directors so elected shall end on the date of the annual
meeting following such election. At any and all such meetings for
such election, the holders of a majority of the outstanding shares of
the Preferred Stock shall be necessary to constitute a quorum for
such election, whether present in person or by proxy, and such two
directors shall be elected by the vote of at least a plurality of
shares held by such stockholders present or represented at the
meeting. Any director elected by holders of shares of the Preferred
Stock pursuant to this Section may be removed at any annual or
special meeting, by vote of a majority of the stockholders voting as
a class who elected such director, with or without cause. In case
any vacancy shall occur among the directors elected by the holders of
the Preferred Stock pursuant to this Section, such vacancy may be
filled by the remaining director so elected, or his successor then in
office, and the director so elected to fill such vacancy shall serve
until the next meeting of stockholders for the election of directors.
After the holders of the Preferred Stock shall have exercised their
right to elect Directors in any default period and during the
continuance of such period, the number of Directors shall not be
further increased or decreased except by vote of the holders of
Preferred Stock as herein provided or pursuant to the rights of any
equity securities ranking senior to or pari passu with the Series A
Junior Preferred Stock.
(iii) The right of the holders of the Preferred Stock, voting
separately as a class, to elect two members of the Board of Directors
of the Corporation as aforesaid shall continue until, and only until,
such time as all arrears in dividends (whether or not declared) on
the Preferred Stock shall have been paid or declared and set apart
for payment, at which time such right shall terminate, except as
herein or by law expressly provided, subject to revesting in the
event of each and every subsequent default of the character
above-mentioned. Upon any termination of the right of the holders of
the shares of the Preferred Stock as a class to vote for directors as
herein provided, the term of office of all directors then in office
elected by the holders of Preferred Stock pursuant to this Section
shall terminate immediately. Whenever the term of office of the
directors elected by the holders of the Preferred Stock pursuant to
this Section shall terminate and the special voting powers vested in
the holders of the Preferred Stock pursuant to this Section shall
have expired, the maximum number of members of the Board of Directors
of the Corporation shall be such number as may be provided for in the
By-laws of the Corporation irrespective of any increase made pursuant
to the provisions of this Section.
(D) Except as set forth herein, holders of Series A Junior 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 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or distributions
payable on the Series A Junior Preferred Stock as provided in Section 2 are
in arrears, thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Series A Junior
Preferred Stock outstanding shall have been paid in full, the Corporation
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 Junior
Preferred Stock;
(ii) declare or pay dividends on or 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 the
Series A Junior Preferred Stock, except dividends paid ratably on the
Series A Junior 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 Junior
Preferred Stock, provided that the Corporation may at any time
redeem, purchase or otherwise acquire shares of any such parity stock
in exchange for shares of any stock of the Corporation ranking junior
(either as to dividends or upon dissolution, liquidation or winding
up) to the Series A Junior Preferred Stock; or
(iv) purchase or otherwise acquire for consideration any shares
of Series A Junior Preferred Stock, except in accordance with a
purchase offer made in writing or by publication (as determined by
the Board of Directors) to all holders of such shares upon such terms
as the Board of Directors, 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.
(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any shares
of stock of the Corporation unless the Corporation could, under paragraph
(A) of this Section, purchase or otherwise acquire such shares at such time
and in such manner.
Section 5. Reacquired Shares. Any shares of Series A Junior
Preferred Stock purchased or otherwise acquired by the Corporation in any
manner whatsoever shall be retired and cancelled 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 of Directors, subject to the conditions and
restrictions on issuance set forth herein.
Section 6. Liquidation, Dissolution or Winding Up. (A) Upon any
voluntary liquidation, dissolution or winding up of the Corporation, no
distribution shall be made to the holders of shares of stock ranking junior
(either as to dividends or upon liquidation, dissolution or winding up) to
the Series A Junior Preferred Stock unless, prior thereto, the holders of
shares of Series A Junior Preferred Stock shall have received $.01 per
share, plus an amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the date of such payment
(the "Series A Liquidation Preference"). Following the payment of the full
amount of the Series A Liquidation Preference, no additional distributions
shall be made to the holders of shares of Series A Junior Preferred Stock
unless, prior thereto, the holders of shares of Common Stock shall have
received an amount per share (the "Common Adjustment") equal to the
quotient obtained by dividing (i) the Series A Liquidation Preference by
(ii) 1000 (as appropriately adjusted as set forth in subparagraph C below
to reflect such events as stock splits, stock dividends and
recapitalizations with respect to the Common Stock) (such number in clause
(ii), the "Adjustment Number"). Following the payment of the full amount
of the Series A Liquidation Preference and the Common Adjustment in respect
of all outstanding shares of Series A Junior Preferred Stock and Common
Stock, respectively, holders of Series A Junior Preferred Stock and holders
of shares of Common Stock shall receive their ratable and proportionate
share of the remaining assets to be distributed in the ratio, on a per
share basis, of the Adjustment Number to 1 with respect to such Preferred
Stock and Common Stock, on a per share basis, respectively.
(B) If, however, there are not sufficient assets available to permit
payment in full of the Series A Liquidation Preference and the liquidation
preferences of all other series of Preferred Stock, if any, which rank on a
parity with the Series A Junior Preferred Stock, then such remaining assets
shall be distributed ratably to the holders of such parity shares in
proportion to their respective liquidation preferences.
(C) If the Corporation shall at any time following February 5, 1996
(i) declare any dividend on Common Stock payable in shares of Common Stock,
(ii) subdivide the outstanding shares of Common Stock or (iii) combine the
outstanding Common Stock into a smaller number of shares, then in each such
case the Adjustment Number in effect immediately prior to such event shall
be adjusted by multiplying such Adjustment Number by a fraction the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such
event.
Section 7. Consolidation, Merger, etc. If the Corporation 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 Junior Preferred Stock shall at the same time be
similarly exchanged or changed in an amount per share (subject to the
provision for adjustment hereinafter set forth) equal to 1000 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. If the Corporation shall at any
time (i) declare any dividend on 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 amount set forth in the preceding sentence with respect to the
exchange or change of shares of Series A Junior Preferred Stock shall be
adjusted by multiplying such amount by a fraction the numerator of which is
the number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common Stock
that were outstanding immediately prior to such event.
Section 8. Redemption. The shares of Series A Junior Preferred Stock
shall not be redeemable by the Corporation. The preceding sentence shall
not limit the ability of the Corporation to purchase or otherwise deal in
such shares of stock to the extent permitted by law.
Section 9. Ranking. The Series A Junior Preferred Stock shall rank
junior to all other series of the Corporation's preferred stock (whether
with or without par value) as to the payment of dividends and the
distribution of assets, unless the terms of any such series shall provide
otherwise.
Section 10.Amendment. The Certificate of Incorporation of the
Corporation shall not be amended in any manner which would materially alter
or change the powers, preferences or special rights of the Series A Junior
Preferred Stock so as to affect them adversely without the affirmative vote
of the holders of a majority or more of the outstanding shares of Series A
Junior Preferred Stock, voting separately as a class.
Section 11.Fractional Shares. Series A Junior 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 Junior Preferred Stock.
IN WITNESS WHEREOF, Brunswick Corporation has caused its corporate
seal to be hereunto affixed and this Certificate to be signed by Xxxxx X.
Xxxxxxxx, Senior Vice President and Chief Financial Officer, and Xxxxxx X.
Xxxxxxxxx, Vice President-Administration and Corporate Secretary, this ___
day of __________________, 1996.
BRUNSWICK CORPORATION
By: _______________________________
Name: Xxxxx X. Xxxxxxxx
Title:Senior Vice President and
Chief Financial Officer
(SEAL)
Attest:
By: ______________________________
Name: Xxxxxx X. Xxxxxxxxx
Title: Vice President-Administration
and Corporate Secretary
Exhibit B
Form of Right Certificate
Certificate No. R- _______Rights
NOT EXERCISABLE AFTER APRIL 1, 2006 OR EARLIER IF THE RIGHTS EXPIRE
UNDER CERTAIN CIRCUMSTANCES OR ARE REDEEMED BY THE COMPANY. THE
RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT
$.01 PER RIGHT ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER
CERTAIN CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING
PERSON (AS SUCH TERM IS DEFINED IN THE RIGHTS AGREEMENT) AND ANY
SUBSEQUENT HOLDER OF SUCH RIGHTS MAY BECOME NULL AND VOID. [THE
RIGHTS REPRESENTED BY THIS 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 RIGHT CERTIFICATE AND THE
RIGHTS REPRESENTED HEREBY MAY BECOME VOID IN THE CIRCUMSTANCES
SPECIFIED IN SECTION 7(e) OF SUCH AGREEMENT.]*
* The portion of the legend in brackets shall be inserted only if
applicable and shall replace the preceding sentence.
Right Certificate
Brunswick Corporation
This certifies that __________________________, or registered
assigns, is the registered owner of the number of Rights set forth above,
each of which entitles the owner thereof, subject to the terms, provisions
and conditions of the Rights Agreement, dated as of February 5, 1996 (the
"Rights Agreement"), between Brunswick Corporation, a Delaware corporation
(the "Company"), and Xxxxxx Trust and Savings Bank (the "Rights Agent"), to
purchase from the Company at any time after the Distribution Date (as such
term is defined in the Rights Agreement) and prior to 5:00 p.m. (Chicago
time) on April 1, 2006, or notice of redemption or exchange at the office
of the Rights Agent (or its successors as Rights Agent) designated for such
purpose, one one-thousandth of a fully paid non-assessable share of Series
A Junior Participating Preferred Stock, par value $0.75 per share
(the"Preferred Shares") of the Company at a purchase price of $85 per one
one-thousandth of a share (the "Purchase Price") upon presentation and
surrender of this Right Certificate with the appropriate Form of Election
to Purchase and related Certificate duly executed. The number of Rights
evidenced by this Right Certificate (and the number of shares which may be
purchased upon exercise thereof) set forth above, and the Purchase Price
per share set forth above, are the number and Purchase Price as of
_______________, 1996, based on the Preferred Shares as constituted at such
date. Capitalized terms not defined in this Right Certificate that are
defined in the Rights Agreement shall have the meanings ascribed to them in
the Rights Agreement.
Upon the occurrence of a Triggering Event, if the Rights evidenced by
this Right Certificate are beneficially owned by (i) an Acquiring Person or
an Affiliate or Associate of any such Acquiring Person (as such terms are
defined in the Rights Agreement), (ii) under certain circumstances
specified in the Rights Agreement, a transferee of any such Acquiring
Person, Associate or Affiliate, or (iii) under certain circumstances
specified in the Rights Agreement, a transferee of a person who, after such
transfer, became an Acquiring Person, or an Affiliate or Associate of an
Acquiring Person, 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 any such Triggering Event.
As provided in the Rights Agreement, the Purchase Price and the
number and kind of Preferred Shares or other securities which may be
purchased upon the exercise of the Rights evidenced by this Right
Certificate are subject to modification and adjustment upon the happening
of certain events.
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 certain circumstances specified
in such Rights Agreement. Copies of the Rights Agreement are on file at
the above-mentioned office of the Rights Agent and are also available upon
written request to the Rights Agent.
This Right Certificate, with or without other Right Certificates,
upon surrender at the principal corporate trust office of the Rights Agent,
may be exchanged for another Right Certificate or Right Certificates of
like tenor and date evidencing Rights entitling the holder to purchase a
like aggregate number of Preferred Shares as the Rights evidenced by the
Right Certificate or Right Certificates surrendered shall have entitled
such holder to purchase. If this Right Certificate shall be exercised in
part, the holder shall be entitled to receive upon surrender hereof another
Right Certificate or Right Certificates for the number of whole Rights not
exercised.
Subject to the provisions of the Rights Agreement, the Rights
evidenced by this Certificate may be redeemed by the Company at its option
at a redemption price of $.01 per Right at any time prior to (i) the time
any Person becomes an Acquiring Person and (ii) the Final Expiration Date.
No fractional Preferred Shares will be issued upon the exercise of
any Right or Rights evidenced hereby (other than fractions which are
integral multiples of one one-thousandth of a Preferred Share, which may at
the election of the Company be evidenced by depository receipts), but in
lieu thereof a cash payment will be made, as provided in the Rights
Agreement.
No holder of this Right Certificate, in such holders capacity as
such, shall be entitled to vote or receive dividends or be deemed for any
purpose the holder of Preferred Shares or of any other securities of the
Company 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, in such holders capacity as such, any of the rights
of a stockholder of the Company or any right to vote for the election of
directors or upon any matter submitted to stockholders at any meeting
thereof, or to give or withhold consent to any corporate action, or to
receive notice of meetings or other actions affecting stockholders (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.
WITNESS the facsimile signature of the proper officers of the Company
and its corporate seal.
Dated as of _______________, 199_
ATTEST: (SEAL) BRUNSWICK CORPORATION
______________________________ By: ______________________________
Name: Name:
Title: Title:
Countersigned:
XXXXXX TRUST AND SAVINGS BANK
By: ______________________________
Authorized Signature
Form of Reverse Side of Right Certificate
FORM OF ASSIGNMENT
(To be executed by the registered holder if such 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.
Date:________________, 19__
______________________________
Signature
Signature Guaranteed:
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) this Right Certificate [ ] is [ ] is
not being sold, assigned and transferred 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 pursuant to 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 subsequently became an Acquiring Person or an Affiliate or
Associate of an Acquiring Person.
Dated:________________, 19__
_________________________
Signature
NOTICE
The signature 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.
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to
exercise Rights represented by the
Right Certificate.)
To: Xxxxxx Trust and Savings Bank
The undersigned hereby irrevocably elects to exercise ___ Rights
represented by this Right Certificate to purchase the 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 shares be issued in the
name of:
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: __________________, 19__
______________________
Signature
Signature Guaranteed:
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) the Rights evidenced by this Right Certificate [ ] are [ ] are
not being exercised 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 pursuant to 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: ________________, 19__
_______________________
Signature
NOTICE
The signature to the foregoing Election to Purchase 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.
