Exhibit 4.1
INTERRA FINANCIAL INCORPORATED
and
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION,
Rights Agent
RIGHTS AGREEMENT
Dated as of April 30, 1997
TABLE OF CONTENTS
Page
Section 1. Certain Definitions 1
Section 2. Appointment of Rights Agent 4
Section 3. Issue of Right Certificates 4
Section 4. Form of Right Certificates 6
Section 5. Countersignature and Registration 6
Section 6. Transfer, Split Up, Combination and Exchange
of Right Certificates; Mutilated, Destroyed,
Lost or Stolen Right Certificates 7
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights 8
Section 8. Cancellation of Right Certificates 9
Section 9. Availability of Preferred Shares 9
Section 10. Preferred Shares Record Date 10
Section 11. Adjustment of Purchase Price, Number and
Kind of Shares or Number of Rights 11
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 22
Section 15. Rights of Action 23
Section 16. Agreement of Right Holders 24
Section 17. Right Certificate Holder Not Deemed a
Stockholder 24
Section 18. Concerning the Rights Agent 25
Section 19. Merger or Consolidation or Change of
Name of Rights Agent 25
Section 20. Duties of Rights Agent 26
Section 21. Change of Rights Agent 28
Section 22. Issuance of New Right Certificates 29
Section 23. Redemption 29
Section 24. Exchange 30
Section 25. Notice of Certain Events 31
Section 26. Notices 32
Section 27. Supplements and Amendments 33
Section 28. Successors 33
Section 29. Benefits of this Agreement 33
Section 30. Severability 34
Section 31. Governing Law 34
Section 32. Counterparts 34
Section 33. Descriptive Headings 34
Signatures 35
Exhibit A _ Certificate of Designations of Series A Junior
Participating Preferred Stock
Exhibit B _ Form of Right Certificates
Exhibit C _ Summary of Rights to Purchase Preferred Shares
RIGHTS AGREEMENT
AGREEMENT, dated as of April 30, 1997, between Interra
Financial Incorporated, a Delaware corporation (the "Company"),
and Norwest Bank Minnesota, National Association (the "Rights
Agent").
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 of the Company outstanding at the
Close of Business on May 12, 1997 (the "Record Date"), each Right
representing the right to purchase one one-hundredth of a
Preferred Share, 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 earliest
of the Distribution Date, the Redemption Date and the Final
Expiration Date (as such terms are hereinafter defined).
Accordingly, 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 who or which,
together with all Affiliates and Associates of such Person, shall
be the Beneficial Owner of the Threshold Percentage or more of
the Common Shares then outstanding other than as a result of a
Permitted Offer, but shall not include any Exempt Person.
Notwithstanding the foregoing, no Person shall become an
"Acquiring Person" as the result of 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 the Threshold Percentage or
more of the Common Shares of the Company then outstanding;
provided, however, that if a Person shall become the Beneficial
Owner of the Threshold Percentage or more of the Common Shares of
the Company then outstanding by reason of share purchases by the
Company and shall, after such share purchases by the Company,
increase the number of Common Shares of the Company beneficially
owned by such Person above the number of Common Shares of the
Company beneficially owned by such Person at the time of the last
such share purchase by the Company, then such Person shall 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 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.
"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. A Person shall be deemed the
"Beneficial Owner" of and shall be deemed to "beneficially own"
any securities:
(i) which such Person or any of such Person's Affiliates or
Associates beneficially owns, directly or indirectly, including
without limitation securities with respect to which such Person
or any such Person's Affiliates or Associates has "beneficial
ownership" pursuant to Rule 13d-3 of the General Rules and
Regulations under the Exchange Act, as in effect on the date of
this Agreement;
(ii) which such Person or any of such Person's Affiliates or
Associates has (A) the right to acquire (whether such right is
exercisable immediately or only after the passage of time)
pursuant to any agreement, arrangement or understanding (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; or (B) the right to vote pursuant to any
agreement, arrangement or understanding; 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) which are beneficially owned, directly or indirectly, by
any other Person with which such Person or any of such Person's
Affiliates or Associates has any agreement, arrangement or
understanding (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)(B) above) 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.
"Business Day" shall mean any day other than a Saturday, a
Sunday or a day on which banking institutions in the State of
Minnesota are authorized or obligated by law or executive order
to close.
"Close of Business" on any given date shall mean 5:00 P.M.,
prevailing Minneapolis time, on such date; provided, however,
that if such date is not a Business Day, it shall mean 5:00 P.M.,
prevailing Minneapolis 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 $.125 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, if such other Person is a Subsidiary of any other
Person, the Person or Persons which ultimately control such first
mentioned Person.
"Distribution Date" shall have the meaning set forth in
Section 3.
"Exchange Act" shall mean the Securities Exchange Act of
1934, as amended.
"Exchange Date" shall have the meaning set forth in Section
7.
"Exempt Person" shall mean the Company, any Subsidiary of the
Company, any employee benefit plan of the Company or of any
Subsidiary of the Company, and any Person organized, appointed or
established by the Company for or pursuant to the terms of any
such plan.
"Final Expiration Date" shall have the meaning set forth in
Section 7.
"Person" shall mean any individual, firm, corporation or
other entity, and shall include any successor (by merger or
otherwise) of such entity.
"Permitted Offer" shall mean a tender offer or an exchange
offer for all outstanding Common Shares of the Company determined
by the Board of Directors of the Company, after receiving such
advice as it deems necessary and giving due consideration to all
relevant factors, to be in the best interests of the Company and
its stockholders.
"Preferred Shares" shall mean shares of Series A Junior
Participating Preferred Stock, par value $1.00, of the Company
having the rights and preferences set forth in the form of
Certificate of Designations attached to this Agreement as Exhibit
A.
"Redemption Date" shall have the meaning set forth in Section
7.
"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) of the Exchange Act) by the Company or any Person that a
Person has become an Acquiring Person.
"Subsidiary" of any Person shall mean 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.
"Threshold Percentage" shall mean 15%.
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, shall
prior to the Distribution Date also be the holders of the Common
Shares) in accordance with the terms and conditions of this
Agreement, 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 Shares Acquisition Date or
(ii) the tenth 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 an Exempt Person) of, or of the first
public announcement of the intention of any Person (other than an
Exempt Person) to commence, a tender or exchange offer the
consummation of which would result in any Person becoming an
Acquiring Person (the earlier of such dates being referred to
herein as the "Distribution Date"), (x) the Rights will be
evidenced (subject to the provisions of Section 3(b)) by the
certificates for Common Shares registered in the names of the
holders thereof (which certificates shall also be deemed to be
Right Certificates) and not by separate Right Certificates, and
(y) the right to receive Right Certificates will be transferable
only in connection with the transfer of Common Shares. 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, 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 (a "Right Certificate"), evidencing one Right
for each Common Share so held. As of the Distribution Date, the
Rights will be evidenced solely by such Right Certificates.
(b) As soon as practicable after the Record Date, the Company
will send a copy of a Summary of Rights to Purchase Preferred
Shares, in substantially the form of Exhibit C (the "Summary of
Rights"), by first-class, postage-prepaid mail, to each record
holder of Common Shares as of the Close of Business on the Record
Date, at the address of such holder shown on the records of the
Company. With respect to certificates for Common Shares
outstanding as of the Close of Business on the Record Date, until
the Distribution Date, the Rights will be evidenced by such
certificates registered in the names of the holders thereof
together with a copy of the Summary of Rights. Until the
Distribution Date (or the earlier of the Redemption Date or the
Final Expiration Date if occurring prior to the Distribution
Date), the surrender for transfer of any certificate for Common
Shares outstanding on the Record Date, with or without a copy of
the Summary of Rights attached thereto, shall also constitute the
transfer of the Rights associated with the Common Shares
represented thereby.
(c) Certificates for Common Shares which become outstanding
(including, without limitation, 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 the
following legend:
This certificate also evidences and entitles the holder hereof to
certain rights as set forth in a Rights Agreement between Interra
Financial Incorporated and Norwest Bank Minnesota, National
Association, dated as of April 30, 1997 (the "Rights Agreement"),
the terms of which are hereby incorporated herein by reference
and a copy of which is on file at the principal executive offices
of Interra Financial Incorporated. 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. Interra Financial Incorporated
will mail to the holder of this certificate a copy of the Rights
Agreement without charge after receipt of a written request
therefor. Under certain circumstances, as set forth in the
Rights Agreement, Rights issued to any Person who becomes an
Acquiring Person or an Associate or Affiliate thereof (as defined
in the Rights Agreement), or certain transferees of such Person,
may become null and void.
With respect to such certificates containing the foregoing
legend, until the Distribution Date, the Rights associated with
the Common Shares represented by such certificates shall be
evidenced by such certificates alone, and the surrender for
transfer of any such certificate shall also constitute the
transfer of the Rights associated with the Common Shares
represented thereby. In the event that 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 canceled 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. The Right
Certificates (and the forms of election to purchase Preferred
Shares and of assignment to be printed on the reverse thereof)
shall be substantially the same as Exhibit B 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 made pursuant
thereto or with any rule or regulation of any stock exchange or
automated quotations system on which the Rights may from time to
time be listed, or to conform to usage. Subject to the
provisions of Section 11, the Right Certificates shall entitle
the holders thereof to purchase such number of one one-hundredths
of a Preferred Share as shall be set forth therein at the price
per one one-hundredth of a Preferred Share set forth therein (the
"Purchase Price"), but the number of such one one-hundredths of a
Preferred Share and the Purchase Price shall be subject to
adjustment as provided herein.
Section 5. Countersignature and Registration. The Right
Certificates shall be executed on behalf of the Company by its
Chairman of the Board, its Chief Executive Officer, its
President, any of its Vice Presidents or its Treasurer either
manually or by facsimile signature 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 for purposes of
authorization only 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 principal office, 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. Subject to the provisions of Section 14, 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 (other than Right Certificates
representing Rights that have become void pursuant to Section
11(a)(ii)) 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 one one-
hundredths of a Preferred Share 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 principal
office of the Rights Agent. Thereupon the Rights Agent shall
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.
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 issue, execute 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) 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 or offices of the
Rights Agent designated for such purpose, together with payment
of the Purchase Price for each one one-hundredth of a Preferred
Share as to which the Rights are exercised, at or prior to the
earliest of (i) the Close of Business on April 30, 2007 (the
"Final Expiration Date"), (ii) the time at which the Rights are
redeemed as provided in Section 23 (the "Redemption Date") or
(iii) the time at which such Rights are exchanged as provided in
Section 24 (the "Exchange Date").
(b) The Purchase Price for each one one-hundredth of a
Preferred Share purchasable pursuant to the exercise of a Right
shall initially be $140.00, shall be subject to adjustment from
time to time as provided in Sections 11 and 13 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 duly
executed, accompanied by payment of the aggregate Purchase Price
for the shares 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 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 for the Preferred Shares (or
make available, if the Rights Agent is the transfer agent for 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 with a depository agent the
total number of Preferred Shares issuable upon exercise of the
Rights hereunder, requisition from the depositary agent
depositary receipts representing such number of one one-
hundredths of a Preferred Share as are to be purchased and the
Company hereby directs 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, (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 to or upon the order of the registered
holder of such Right Certificate.
(d) In case the registered holder of any Right Certificate
shall exercise less than all of the Rights evidenced thereby, a
new Right Certificate evidencing Rights equivalent to the Rights
remaining unexercised shall be issued by the Rights Agent to the
registered holder of such Right Certificate or to such holder's
duly authorized assigns, subject to the provisions of Section 14.
(e) 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 unless such registered holder shall have (i) duly
completed and executed the form of election to purchase set forth
on the reverse side of the Right Certificate surrendered for such
exercise and (ii) provided such additional evidence of the
identity of the Beneficial Owner (or former Beneficial Owner) of
such Right Certificate or Affiliates or Associates thereof as the
Company shall reasonably request.
Section 8. Cancellation 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 canceled form, or, if surrendered to the
Rights Agent, shall be canceled 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 canceled Right Certificates to the Company.
Section 9. Availability of Preferred Shares.
(a) The Company will cause to be reserved and kept available
out of its authorized and unissued Preferred Shares, or any
Preferred Shares held in its treasury, the number of Preferred
Shares that will be sufficient to permit the exercise in full of
all outstanding Rights.
(b) At such time, if any, as the Preferred Shares issuable
upon the exercise of 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
(but only to the extent that it is reasonably likely that the
Rights will be exercised), all shares reserved for such issuance
to be listed on such exchange upon official notice of issuance
upon such exercise.
(c) The Company will prepare and file, as soon as practicable
after the Distribution Date, a registration statement under the
Securities Act of 1933, as amended (the "Act"), with respect to
the Rights and the securities purchasable upon exercise of the
Rights on an appropriate form, and use its best efforts to cause
such registration statement to (i) become effective as soon as
practicable after such filing, and (ii) remain effective (with a
prospectus at all times meeting the requirements of the Act)
until the earlier of (A) the date as of which the Rights are no
longer exercisable for such securities or (B) the Final
Expiration Date. The Company will also take such action as may
be appropriate under, or to ensure compliance with, the
securities or "blue sky" laws of the various states in connection
with the exercisability of the Rights. The Company may
temporarily suspend, for a period of time not to exceed 90 days
after the date the registration statement is filed, the
exercisability of the Rights in order to permit the registration
statement to become effective. Upon any such suspension, the
Company shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended, as
well as a public announcement at such time as the suspension is
no longer in effect. Notwithstanding any provision of this
Agreement to the contrary, the Rights shall not be exercisable in
any jurisdiction if the requisite qualification in such
jurisdiction shall not have been obtained or the exercise thereof
is not permitted under applicable law.
(d) The Company will take all such action as may be necessary
to ensure that all Preferred Shares delivered upon exercise of
Rights shall, at the time of delivery of the certificates for
such Preferred Shares (subject to payment of the Purchase Price
and any applicable transfer taxes), be duly and validly
authorized and issued and fully paid and nonassessable shares.
(e) The Company 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 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 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 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 is issued upon
the exercise of Rights shall for all purposes be deemed to have
become the holder of record of the Preferred Shares 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 transfer
books of the Company for the Preferred Shares are closed, such
Person shall be deemed to have become the record holder of such
shares on, and such certificate shall be dated, the next
succeeding Business Day on which such transfer books 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 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 and Kind 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) In the event 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), the Purchase Price in effect at the time of the
record date for such dividend or of the effective date of such
subdivision, combination or reclassification, 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, 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, such holder would have owned upon such exercise and
been entitled to receive by virtue of such dividend, subdivision,
combination or reclassification; 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
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, in the event any
Person becomes an Acquiring Person, unless the event by which
such Person became an Acquiring Person is a transaction described
in Section 13(a), each holder of a Right 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-
hundredths 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-hundredths
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)) on the date that such Person becomes an
Acquiring Person. In the event that 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.
From and after the date that such Person becomes an Acquiring
Person, any Rights that are or were acquired or beneficially
owned by any Acquiring Person (or any Associate or Affiliate of
such Acquiring Person) shall be void and any holder of such
Rights shall thereafter have no right to exercise such Rights
under any provision of this Agreement. No Right Certificate
shall be issued pursuant to Section 3 that represents Rights
beneficially owned by an Acquiring Person whose Rights would be
void pursuant to the preceding sentence or any Associate or
Affiliate thereof; no Right Certificate shall be issued at any
time upon the transfer of any Rights to an Acquiring Person whose
Rights would be void pursuant to the preceding sentence or any
Associate or Affiliate thereof or to any nominee of such
Acquiring Person, Associate or Affiliate; and any Right
Certificate delivered to the Rights Agent for transfer to an
Acquiring Person whose Rights would be void pursuant to the
preceding sentence shall be canceled.
(iii) In the event that there shall not be sufficient Common
Shares issued but not outstanding or authorized but unissued to
permit the exercise in full of the Rights in accordance with the
foregoing subparagraph (ii), the Company shall take all such
action as may be necessary to authorize additional Common Shares
for issuance upon exercise of the Rights. In the event the
Company shall, after good faith effort, be unable to take all
such action as may be necessary to authorize such additional
Common Shares, the Company shall substitute, for each Common
Share that would otherwise be issuable upon exercise of a Right,
a number of Preferred Shares or fraction thereof such that the
current per share market price of one Preferred Share multiplied
by such number or fraction is equal to the current per share
market price of one Common Share as of the date of issuance of
such Preferred Shares or fraction thereof.
(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 to subscribe for or purchase
Preferred Shares (or shares having the same rights, privileges
and preferences as the Preferred Shares (such shares are herein
called "preferred share equivalents")) or securities convertible
into Preferred Shares or preferred share equivalents at a price
per Preferred Share or preferred share equivalent (or having a
conversion price per share, if a security convertible into
Preferred Shares or preferred share equivalents) less than the
then current per share market price (as such term is defined in
Section 11(d)) of the Preferred Shares 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 preferred share equivalents 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 preferred share
equivalents 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 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 and the holders of the Rights. Preferred
Shares 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 in the event that 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 regular quarterly cash dividend or a dividend
payable in Preferred Shares) or subscription rights or warrants
(excluding those referred to in Section 11(b)), 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 in the event that 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, 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 immediately
prior to such date; provided, however, that in the event that 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, 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 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 Quotations 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 day no market maker is
making a market in the Common Shares, the fair value of such
share on such day as determined in good faith by the Board of
Directors of the Company shall be used in lieu of the closing
price for such day. 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 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 hundred. If neither the Common Shares nor the
Preferred Shares are publicly held or so listed or traded,
"current per share market price" of the Preferred Shares 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) 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 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) and 13(a), 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 Section 11(a)
through (c), inclusive, 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 one-hundredths 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), subject to the provisions of Sections
11(a) and 13, 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 one-hundredths of
a Preferred Share (calculated to the nearest one one-millionth of
a Preferred Share) obtained by (i) multiplying (x) the number of
one one-hundredths 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 one-
hundredths 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
one-hundredths 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 ten 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,
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, may bear, at the option of the Company, the
adjusted Purchase Price, 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 one-hundredths 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 one-hundredths 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 one-hundredth 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 in their sole discretion the Board of Directors of
the Company shall determine to be advisable in order that any (i)
consolidation or subdivision of the Preferred Shares, (ii)
issuance wholly for cash of any Preferred Shares at less than the
current market price, (iii) issuance wholly for cash of Preferred
Shares or securities which by their terms are convertible into or
exchangeable for Preferred Shares, (iv) dividends on Preferred
Shares payable in Preferred Shares or (v) issuance of rights,
options or warrants referred to herein above in Section 11(b),
hereafter made by the Company to holders of its Preferred Shares
shall not be taxable to such stockholders.
(n) The Company shall not, at any time after the Distribution
Date, (i) consolidate with any other Person (other than a
Subsidiary of the Company in a transaction which complies with
Section 11(o)), (ii) merge with or into any other Person (other
than a Subsidiary of the Company in a transaction which complies
with Section 11(o)), or (iii) sell or transfer (or permit any
Subsidiary to sell or transfer), in one transaction, or a series
of related transactions, assets or earning power aggregating more
than 50% of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to any other Person or Persons
(other than the Company and/or any of its subsidiaries in one or
more transaction each of which complies with Section 11(o)), if
(x) at the time of or immediately after such consolidation,
merger or sale there are any rights, warrants or other
instruments or securities outstanding or agreements in effect
which would substantially diminish or otherwise eliminate the
benefits intended to be afforded by the Rights or (y) prior to,
simultaneously with or immediately after such consolidation,
merger or sale, the shareholders of the Person who constitutes,
or would constitute, the "Principal Party" for purposes of
Section 13(a) shall have received a distribution of Rights
previously owned by such Person or any of its Affiliates and
Associates.
(o) The Company, after the Distribution Date, will not, except
as permitted by Section 23, 24 or 27, take (or permit any
Subsidiary of the Company to take) any action if at the time such
action is taken it is reasonably foreseeable that such action
will diminish substantially or otherwise eliminate the benefits
intended to be afforded by the Rights.
(p) Anything in this Agreement or the Rights to the
contrary notwithstanding, in the event that 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 one-hundredths of a
Preferred Share purchasable after such event upon proper exercise
of each Right shall be determined by multiplying the number of
one one-hundredths of a Preferred Shares of 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(p) shall be made successively whenever such a dividend
is declared or paid or such a subdivision, combination or
consolidation is effected. If an event occurs which would
require an adjustment under Section 11(a)(ii) and this Section
11(p), the adjustments provided for in this Section 11(p) shall
be in addition and prior to any adjustment required pursuant to
Section 11(a)(ii).
Section 12. Certificate of Adjusted Purchase Price or Number
of Shares. Whenever an adjustment is made as provided in
Sections 11 and 13, 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.
Section 13. Consolidation, Merger or Sale of Transfer of
Assets or Earning Power.
(a) In the event, directly or indirectly, at any time after
there is an Acquiring Person,
(w) the Company shall consolidate with, or merge with and
into, any other Person and the Company shall not be the
continuing or surviving corporation of such consolidation or
merger,
(x) any Person shall consolidate with, or merge with and
into, the Company, the Company shall be the continuing or
surviving corporation of such consolidation or merger and, in
connection with such consolidation or 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,
(y) the Company shall effect a statutory share exchange with
the outstanding Common Shares of the Company being exchanged for
stock or other securities of any other Person, cash or 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 other Person other than
the Company or one or more of its wholly owned Subsidiaries,
then, and in each such case, except as contemplated by Section
13(e), proper provision shall be made so that (i) each holder of
a Right (except as otherwise provided in this Agreement) 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 one-hundredths 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, nonassessable and freely
tradeable Common Shares of the Principal Party, not subject to
any liens, encumbrances, rights of first refusal or adverse
claims, as shall be equal to the result obtained by (x)
multiplying the then current Purchase Price by the number of one
one-hundredths of a Preferred Share for which a Right is,
immediately prior to such consolidation, merger, statutory share
exchange, sale or transfer, exercisable and (y) dividing that
product by 50% of the current per share market price of the
Common Shares of such Principal Party (determined pursuant to
Section 11(d)) on the date of consummation of such consolidation,
merger, statutory share exchange, sale or transfer; (ii) such
Principal Party shall thereafter be liable for, and shall assume,
by virtue of such merger, consolidation, statutory share
exchange, sale or transfer, 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 to permit the exercise of all outstanding Rights)
in connection with the consummation of any such transaction as
may be necessary to assure that the provisions of this Agreement
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 clauses (w),
(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, consolidation or
exchange, or if no securities are so issued, the Person that is
the other party to such merger, consolidation or exchange; and
(ii) in the case of any transaction described in clause (z) of
the first sentence of 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, (1) if the Common
Shares of such Person are not at such time or 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
are and have been so registered, "Principal Party" shall refer to
such other Person, and (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.
(c) The Company shall not consummate any such consolidation,
merger, share exchange, sale or transfer unless the Principal
Party shall have a sufficient number of authorized, unreserved
Common Shares which have not been issued or are held in treasury
to permit the exercise in full of the Rights in accordance with
this Section 13 and unless 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 such
consolidation, merger, share exchange, sale or transfer, the
Principal Party will:
(i) prepare and file a registration statement under the Act,
with respect to the Rights and the securities purchasable upon
exercise of the Rights, on an appropriate form, and 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 Act) until the earlier of (1) the date as of
which the Rights are no longer exercisable for such securities or
(2) the Final Expiration Date;
(ii) take such action as may be appropriate under, or to
ensure compliance with, the securities or "blue sky" laws of the
various states in connection with the exercisability of the
Rights; and
(iii) 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.
(d) The Company shall not enter into any transaction of the
kind referred to in this Section 13 if at the time of such
transaction there are any rights, warrants, instruments or
securities outstanding or any agreements or arrangements which,
as a result of the consummation of such transaction, would
substantially diminish or otherwise eliminate the benefits
intended to be afforded by the Rights. Without limiting the
generality of the preceding sentence, in case the Principal Party
which is to be a party to a transaction of the kind referred to
in this Section 13 has a provision in any of its authorized
securities or in its certificate of incorporation or bylaws or
other instrument governing its corporate affairs, which provision
would have the effect of (i) causing such Principal Party to
issue, in connection with, or as a consequence of, the
consummation of a transaction of the kind referred to in this
Section 13, Common Shares of such Principal Party at less than
the then current per share market price (determined pursuant to
Section 11(d)) or securities exercisable for or convertible into
Common Shares of such Principal Party at less than such then
current market price (other than to holders of Rights pursuant to
this Section 13) or (ii) providing for any special payment, tax
or similar provisions in connection with the issuance of Common
Shares of such Principal Party pursuant to the provisions
of Section 13, then, in such event, the Company shall not
consummate any such transaction unless prior thereto the
provision in question of such Principal Party shall have been
canceled, waived or amended so as to avoid any of the effects
referred to in clauses (i) and (ii) of this paragraph, or the
authorized securities shall have been redeemed, so that the
applicable provision will have no effect in connection with, or
as a consequence of, the consummation of the proposed
transaction.
(e) Notwithstanding anything in this Agreement to the
contrary, Section 13 shall not be applicable to a transaction
described in clauses (w), (x) or (y) of Section 13(a) if (i) such
transaction is consummated with a Person or Persons who acquired
Common Shares pursuant to a Permitted Offer (or a wholly owned
Subsidiary of any such Person or Persons), (ii) the price per
Common Share offered in such transaction is not less than the
price per Common Share paid to all holders of Common Shares whose
shares were purchased pursuant to such tender offer or exchange
offer and (iii) the form of consideration being offered to the
remaining holders of Common Shares pursuant to such transaction
is the same as the form of consideration paid pursuant to such
tender offer or exchange offer. Upon consummation of any such
transaction contemplated by this Section 13(e), all Rights
hereunder shall expire.
(f) The provisions of this Section 13 shall similarly apply
to successive mergers, consolidations, statutory share exchanges
or sale or other transfers.
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
shall 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 one-hundredth 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 one-hundredth of a Preferred
Share). Fractions of Preferred Shares in integral multiples of
one one-hundredth 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, however, that if the Company issues
depositary receipts pursuant to any such agreement, 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 one-hundredth of a Preferred Share, the Company shall 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 Preferred
Share. For the purposes of this Section 14(b), the current
market value of a Preferred Share shall be the closing price of a
Preferred Share (as determined pursuant to Section 11(d)) for the
Trading Day immediately prior to the date of such exercise.
(c) The holder of a Right by the acceptance of the Right
expressly waives such holder's 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, 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 such holder's own behalf and
for such holder's own benefit, enforce, and may institute and
maintain any suit, action or proceeding against the Company to
enforce, or otherwise act in respect of, such holder's 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 principal office of the Rights Agent, duly
endorsed or accompanied by a proper instrument of transfer; and
(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.
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), 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 of this Agreement.
Section 18. Concerning the Rights Agent.
(a) The Company will 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 will
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.
(b) 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 for depositary receipts evidencing
fractional interests in 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.
Section 19. Merger or Consolidation or Change of Name of
Rights Agent.
(a) 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 to
this Agreement, provided that such corporation would be eligible
for appointment as a successor Rights Agent under the provisions
of Section 21. 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.
(b) 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
Chairman of the Board, the President, any Vice President, the
Treasurer 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 its own 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 of this Agreement (except the due execution of this
Agreement 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 11(a)(ii)) 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 actual
notice from the Company stating that a change or adjustment is
required and specifying the manner and amount thereof); 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 to be issued pursuant to this Agreement or any Right
Certificate or as to whether any Preferred Shares will, when
issued, be validly authorized and issued, fully paid and
nonassessable.
(f) The Company 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 Chairman of the Board, the
President, any Vice President, the Secretary or the Treasurer 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 to be taken by it in good
faith in accordance with instructions of any such officer or for
any delay in acting while waiting for those instructions.
(h) The Rights Agent and any shareholder, 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 become pecuniarily
interested in any transaction in which the Company may be
interested, or contract with or lend money to the Company 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
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) No provision of this Agreement shall require the Rights
Agent to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties
hereunder or in the exercise of its rights if there shall be
reasonable grounds for believing that repayment of such funds or
adequate indemnification against such risk or liability is not
reasonably assured to it.
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 and 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 and Preferred Shares by
registered or certified 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 such
holder's 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) a corporation
organized and doing business under the laws of the United States
or of the State of Minnesota or New York (or of any other state
of the United States so long as such corporation is authorized to
do business as a banking institution in the State of Minnesota or
New York), in good standing, having an office in the State of
Minnesota or New York, 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 has or is a subsidiary of a corporation which has at the
time of its appointment as Rights Agent a combined capital and
surplus of at least $50 million, or (b) an affiliate of a
corporation described in clause (a) of this sentence. 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 and Preferred
Shares. 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. In addition, in connection with the issuance or sale
of Common Shares after the Distribution Date, the Company shall,
with respect to Common Shares issued upon the exercise,
conversion or exchange of securities hereinafter issued by the
Company and outstanding on the Distribution Date, issue Rights
Certificates representing the appropriate number of rights in
connection with such issuance; provided, however, that (i) no
such Rights Certificate shall be issued if, and to the extent
that, the Company shall be advised by counsel that such issuance
would create a significant risk of material adverse tax
consequences to the Company or the Person to whom such Right
Certificate would be issued, and (ii) no such Right Certificate
shall be issued if, and to the extent that, appropriate
adjustment shall otherwise have been made in lieu of the issuance
thereof.
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 of the then outstanding
Rights at a redemption price of $0.01 per Right, appropriately
adjusted to reflect any stock split, stock dividend or similar
transaction occurring after the date of this Agreement (such
redemption price being hereinafter referred to as the "Redemption
Price"). The redemption of the Rights by the Board of Directors
may be made effective at such time and on such basis and with
such conditions as the Board of Directors in its sole discretion
may establish.
(b) Immediately upon the action of the Board of Directors of
the Company ordering the redemption of the Rights 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 ten days after such action of the Board of Directors
ordering the redemption of the Rights, 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. 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
or in Section 24, and other than in connection with the purchase
of Common Shares prior to the Distribution Date.
Section 24. Exchange.
(a) The Board of Directors of the Company may, at its option,
at any time after any Person becomes an Acquiring Person,
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 11(a)(ii)) for Common
Shares at an exchange ratio of one Common Share per Right,
appropriately adjusted to reflect any stock split, stock dividend
or similar transaction occurring after the date of this Agreement
(such exchange ratio being hereinafter referred to as the
"Exchange Ratio"). Notwithstanding the foregoing, the Board of
Directors shall not be empowered to effect such exchange at any
time after any Person (other than an Exempt Person) together with
all Affiliates and Associates of such Person, becomes the
Beneficial Owner of 50% or more of the Common Shares then
outstanding.
(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 outstanding and
exercisable Rights (other than Rights which have become void
pursuant to the provisions of Section 11(a)(ii)) held by each
holder of Rights.
(c) In the event that there shall not be sufficient Common
Shares issued but not outstanding or authorized but unissued and
unreserved 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
for issuance upon exchange of the Rights. In the event the
Company shall, after good faith effort, be unable to take all
such action as may be necessary to authorize such additional
Common Shares, the Company shall substitute, for each Common
Share that would otherwise be issuable upon exchange of a Right,
a number of Preferred Shares or fraction thereof such that the
current per share market price of one Preferred Share multiplied
by such number or fraction is equal to the current per share
market price of one Common Share as of the date of issuance of
such Preferred Shares or fraction thereof.
(d) 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 (d), 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)) 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 any
statutory share exchange with the outstanding Common Shares of
the Company being exchanged for stock or other securities of any
other corporation or cash or other property, (vi) to effect the
liquidation, dissolution or winding up of the Company or (vii) 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, 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)
of this paragraph at least ten 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 ten
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) shall
occur, then the Company shall as soon as practicable thereafter
give to each holder of a Right Certificate, in accordance with
Section 26, 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).
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:
Interra Financial Incorporated
Xxxx Xxxxxxxx Plaza
00 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000-0000
Subject to the provisions of Section 21, 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:
Norwest Bank Minnesota, National Association
Attention: Shareholder Services
000 Xxxxx Xxxxxxx Xxxxxxxx
Xxxxx Xx. Xxxx, XX 00000-0000
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 (i) to
extend the Final Expiration Date or, provided that at the time of
such amendment no Person has become an Acquiring Person, the
period during which the Rights may be redeemed, (ii) to cur any
ambiguity, to correct or supplement any provision contained
herein which may be defective or inconsistent with any other
provisions of this Agreement, (iii) prior to the time that any
Person becomes an Acquiring Person, to otherwise change or
supplement any provision in this Agreement in any manner which
the Company may deem necessary or desirable, or (iv) subject to
clause (i) of this Section 27, from and after the time that any
Person becomes an Acquiring Person, to otherwise change or
supplement any provision in this Agreement in any manner which
the Company may deem necessary or desirable and which shall not
adversely affect the interests of the holders of Right
Certificates (other than an Acquiring Person or an Affiliate or
Associate of an Acquiring Person).
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 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 same
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 of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed, all as of the day and year first
above written.
INTERRA FINANCIAL INCORPORATED
By Xxxxxx Xxxxxx
------------------------------------
Xxxxxx Xxxxxx
Its Chairman, President and Chief Executive Officer
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
By Xxxxx X. Xxxxxx
------------------------------------
Xxxxx X. Xxxxxx
Its Assistant Vice President
Exhibit A
CERTIFICATE OF DESIGNATIONS
OF
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
OF
INTERRA FINANCIAL INCORPORATED
The undersigned hereby certifies that the Board of Directors
of Interra Financial Incorporated (the "Corporation"), a
corporation organized and existing under the Delaware General
Corporation Law, duly adopted the following resolution on April
30, 1997:
RESOLVED, that a series of preferred stock of the Corporation
is hereby created, and the designation and amount thereof and the
relative rights and preferences of the shares of such series, are
as follows:
Section 1. Designation and Amount. The shares of such
series shall be designated as "Series A Junior Participating
Preferred Stock" (the "Preferred Shares") and the number of
shares constituting the Preferred Shares shall be 200,000. Such
number of shares may be increased or decreased by resolution of
the Board of Directors and any necessary stockholder approval;
provided, however, that no decrease shall reduce the number of
shares of Preferred Shares to a number less than the number of
shares then outstanding plus the number of shares reserved for
issuance upon the exercise of outstanding options, rights or
warrants or upon the conversion of any outstanding securities
issued by the Corporation convertible into Preferred Shares.
Section 2. Dividends and Distributions.
(a) Subject to the rights of the holders of any shares of any
series of preferred stock (or any similar stock) ranking prior
and superior to the Preferred Shares with respect to dividends,
the holders of Preferred Shares, in preference to the holders of
Common Stock, par value $.125 (the "Common Stock"), of the
Corporation, and of any other junior stock, shall be entitled to
receive, when, as and if declared by the Board of Directors out
of funds legally available for the purpose, quarterly dividends
payable in cash on the first 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 Preferred Shares, in an amount
per share (rounded to the nearest cent) equal to the greater of
(i) $1.00 or (ii) subject to the provision for adjustment
hereinafter set forth, 100 times the aggregate per share amount
of all cash dividends, and 100 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 or a subdivision of the outstanding shares of Common Stock
(by reclassification or otherwise), declared on 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
Preferred Shares. In the event the Corporation shall at any time
after April 30, 1997, declare or pay any dividend on the Common
Stock payable in shares of Common Stock, or effect a subdivision
or combination or consolidation of the outstanding shares of
Common Stock (by reclassification or otherwise) into a greater or
lesser number of shares of Common Stock, then in each such case
the amount to which holders of shares of Preferred Shares were
entitled immediately prior to such event under clause (ii) of the
preceding sentence 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.
(b) The Corporation shall declare a dividend or distribution
on the Preferred Shares as provided in paragraph (a) of this
Section immediately after it declares a dividend or distribution
on the Common Stock (other than a dividend payable in shares of
Common Stock or a subdivision of the outstanding Common Stock);
provided that, in the event no dividend or distribution shall
have been declared on the Common Stock during the period between
any Quarterly Dividend Payment Date and the next subsequent
Quarterly Dividend Payment Date, a dividend of $1.00 per share on
the Preferred Shares shall nevertheless be payable, out of funds
legally available for such purpose, on such subsequent Quarterly
Dividend Payment Date.
(c) Dividends shall begin to accrue and be cumulative on
outstanding shares of Preferred Shares from their date of issue.
Accrued but unpaid dividends shall not bear interest. Dividends
paid on the shares of Preferred Shares 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 Preferred Shares entitled to receive payment of a dividend or
distribution declared thereon, which record date shall be not
more than 60 days prior to the date fixed for the payment
thereof.
Section 3. Voting Rights.
(a) Subject to the provision for adjustment hereinafter set
forth, each Preferred Share shall entitle the holder thereof to
100 votes on all matters submitted to a vote of the stockholders
of the Corporation. In the event the Corporation shall at any
time after April 30, 1997, declare or pay any dividend on the
Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding
shares of Common Stock (by reclassification or otherwise) into a
greater or lesser number of shares of Common Stock, then in each
such case the number of votes per share to which holders of
shares of Preferred Shares 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 Preferred Shares and the holders 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) Except as set forth herein or required by law, holders of
Preferred Shares 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 Preferred Shares 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 Preferred Shares outstanding shall have been paid in
full, the Corporation shall not:
(i) declare or pay dividends, or make any other distributions,
on any shares of stock ranking junior (either as to dividends or
upon liquidation, dissolution or winding up) to the Preferred
Shares;
(ii) declare or pay dividends, 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 Preferred Shares, except dividends paid ratably on the
Preferred Shares 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 junior (either as to dividends or
upon liquidation, dissolution or winding up) to the Preferred
Shares; provided, however, that the Corporation may at any time
redeem, purchase or otherwise acquire shares of any such junior
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 Preferred Shares; or
(iv) redeem or purchase or otherwise acquire for consideration
any Preferred Shares, or any stock ranking on a parity with the
Preferred Shares, 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 4, purchase or
otherwise acquire such shares at such time and in such manner.
Section 5. Reacquired Shares. Any Preferred Shares
purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and canceled 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 subject to the conditions and restrictions on issuance set
forth herein, in the Certificate of Incorporation, or in any
other certificate of designation creating a series of preferred
stock or any similar stock or as otherwise required by law.
Section 6. Liquidation, Dissolution or Winding Up. Upon any
liquidation, dissolution or winding up of the Corporation, no
distribution shall be made (1) to the holders of shares of stock
ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Preferred Shares unless, prior
hereto, the holders of Preferred Shares shall have received the
greater of (i) $100 per share, plus an amount equal to accrued
and unpaid dividends and distributions thereon, whether or not
declared, to the date of such payment, or (ii) an aggregate
amount per share, subject to the provision for adjustment
hereinafter set forth, equal to 100 times the aggregate amount to
be distributed per share to holders of Common Stock, or (2) to
the holders of stock ranking on a parity (either as to dividends
or upon liquidation, dissolution or winding up) with the
Preferred Shares, except distributions made ratably on the
Preferred Shares and all such parity stock in proportion to the
total amounts to which the holders of all such shares are
entitled upon such liquidation, dissolution or winding up. In
the event the Corporation shall at any time after April 30, 1997,
declare or pay any dividend on the Common Stock payable in shares
of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise) into a greater or lesser number of
shares of Common Stock, then in each such case the aggregate
amount to which holders of shares of Preferred Shares were
entitled immediately prior to such event under clause (1)(ii) of
the preceding sentence 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 7. Consolidation, Merger, etc. In case 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
each share of Preferred Shares shall at the same time be
similarly exchanged or changed into an amount per share, subject
to the provision for adjustment hereinafter set forth, equal to
100 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. In the event the Corporation shall at any time after
April 30, 1997, declare or pay any dividend on the Common Stock
payable in shares of Common Stock, or effect a subdivision or
combination or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise) into a greater or lesser
number of shares of Common Stock, then in each such case the
amount set forth in the preceding sentence with respect to the
exchange or change of shares of Preferred Shares 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. No Redemption. The Preferred Shares shall not be
redeemable.
Section 9. Rank. The Preferred Shares shall rank, with
respect to the payment of dividends and the distribution of
assets, junior to all other series of the Corporation's $1 Par
Value Preferred Stock and any other class of the Corporation's
Preferred Stock.
Section 10. Fractional Shares. Preferred Shares may be
issued in fractions of a share which are integral multiples of
one one-hundredth of a share which shall entitle the holder, in
proportion to such holder's fractional shares, to receive
dividends, participate in distributions and to have the benefit
of all other rights of holders of Preferred Shares.
Section 11. 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 rights of
the Preferred Shares so as to affect them adversely without the
affirmative vote of the holders of at least two-thirds of the
outstanding shares of Preferred Shares, voting together as a
single class.
IN WITNESS WHEREOF, I have subscribed my name this 30th day
of April, 1997.
INTERRA FINANCIAL INCORPORATED
By __________________________
[Name and Title]
Exhibit B
FORM OF RIGHT CERTIFICATES
Certificate No. R-___ _________ Rights
NOT EXERCISABLE AFTER April 30, 2007 OR EARLIER IF REDEMPTION OR
EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $0.01
PER RIGHT (SUBJECT TO ADJUSTMENT) AND TO EXCHANGE ON THE TERMS
SET FORTH IN THE RIGHTS AGREEMENT. UNDER CERTAIN
CIRCUMSTANCES SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS
BENEFICIALLY OWNED BY A PERSON WHO IS, WAS OR BECOMES AN
ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE OF AN ACQUIRING
PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) AND
SUBSEQUENT HOLDERS OF SUCH RIGHTS MAY BECOME NULL AND VOID.
RIGHT CERTIFICATE
INTERRA FINANCIAL INCORPORATED
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 April 30, 1997 (the "Rights Agreement"), between
Interra Financial Incorporated, a Delaware corporation (the
"Company"), and Norwest Bank Minnesota, National Association (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., Minneapolis time, on April 30,
2007, at the office or offices of the Rights Agent designated for
such purpose, or of its successor as Rights Agent, one one-
hundredth of a fully paid non-assessable share of Series A Junior
Participating Preferred Stock, par value $1.00 per share (the
"Preferred Shares"), of the Company, at a purchase price of
$140.00 (the "Purchase Price"), upon presentation and surrender
of this Right Certificate with the Form of Election to Purchase
duly executed. The number of Rights evidenced by this Right
Certificate and the number of one one-hundredths of a Preferred
Share which may be purchased upon exercise hereof) set forth
above, and the Purchase Price set forth above, are the number and
Purchase Price as of April 30, 1997, based on the Preferred
Shares as constituted at such date. As provided in the Rights
Agreement, the Purchase Price and the number of one one-
hundredths of a Preferred Share 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. Copies of the Rights Agreement are on file
at the principal executive offices of the Company and the office
or offices of the Rights Agent and will be mailed without charge
by the Company or the Rights Agent to the holder of this
certificate promptly following receipt by the Company or the
Rights Agent of a written request therefor.
From and after the date that any Person becomes an Acquiring
Person, any Rights that are or were acquired or beneficially
owned by any Acquiring Person (or any Associate or Affiliate of
such Acquiring Person) (as such terms are defined in the Rights
Agreement) shall be void and any holder of such Rights shall
thereafter have no right to exercise such Rights under any
provision of this Agreement.
This Right Certificate, with or without other Right
Certificates, upon surrender at the office or offices of the
Rights Agent designated for such purpose, 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 (i) may, but are not required to,
be redeemed by the Company at a redemption price of $0.01 per
Right, subject to adjustment as provided in the Rights Agreement,
and (ii) may, but are not required to, be exchanged by the
Company in whole or in part for Common Shares.
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-hundredth of a
Preferred Share, which may, at the election of the Company, be
evidenced by depositary receipts), but in lieu thereof a cash
payment will be made, as provided in the Rights Agreement.
No holder of this Right Certificate shall be entitled to vote
or receive dividends or be deemed for any purpose the holder of
the 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, 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 manual or facsimile signature of the proper
officer of the Company.
Dated:
INTERRA FINANCIAL INCORPORATED
By __________________________
[Name and Title]
Countersigned for purposes
of authentication only:
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
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 ______________________________ (print name of
transferee) ______________________________________ (print 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.
Please insert social security number taxpayer identification
number or other identifying number:
Dated: ______________________
___________________________
Signature
Signature Guaranteed:_______________________
The signature(s) should be guaranteed by an eligible
guarantor institution (banks, stockbrokers, savings and loan
associations and credit unions with membership in an approved
signature guarantee medallion program), pursuant to S.E.C. Rule
17Ad-15. Form of Reverse Side of Right Certificate_continued
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise the Right
Certificate.)
To: Interra Financial Incorporated
The undersigned hereby irrevocably elects to
exercise_________ Rights represented by this Right Certificate to
purchase the Preferred Shares issuable upon the exercise of such
Rights and requests that certificates for such Preferred Shares
be issued in the name of:
Please insert social security
number, taxpayer identification
number 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
remaining of such Rights shall be registered in the name of and
delivered to:
Please insert social security,
taxpayer identification
or other identifying number:___________________________________
_______________________________________________________________
(Please print name and address)
Dated: ___________________________
________________________________
Signature
Signature Guaranteed: __________________________________
The signature(s) should be guaranteed by an eligible
guarantor institution (banks, stockbrokers, savings and loan
associations and credit unions with membership in an approved
signature guarantee medallion program), pursuant to S.E.C. Rule
17Ad-15.
Exhibit C
INTERRA FINANCIAL INCORPORATED
SUMMARY OF RIGHTS TO PURCHASE
PREFERRED SHARES
On April 30, 1997, the Board of Directors of Interra
Financial Incorporated (the "Company"), declared a dividend of
one preferred share purchase right (a "Right") per share for each
outstanding share of Common Stock, par value $.125 (the "Common
Shares"), of the Company. The dividend is payable to
stockholders of record on May 12, 1997 (the "Record Date").
Each Right entitles the registered holder to purchase from
the Company one one-hundredth of a share of Series A Junior
Participating Preferred Stock, par value $1.00 (the "Preferred
Shares"), of the Company at a price of $140.00 per one-hundredth
of a Preferred Share (the "Purchase Price"), subject to
adjustment. The description and terms of the Rights are set
forth in a Rights Agreement (the "Rights Agreement"), dated as of
April 30, 1997, between the Company and Norwest Bank Minnesota,
National Association, as Rights Agent (the "Rights Agent").
Initially, the Rights will be evidenced by the certificates
representing Common Shares then outstanding and no separate Right
Certificates will be distributed. The Rights will separate from
the Common Shares, and a Distribution Date for the Rights will
occur, upon the earlier of: (i) the first date of public
announcement that a person or group of affiliated or associated
persons has become an "Acquiring Person" (i.e., has become the
beneficial owner of 15% or more of the outstanding Common Shares
(other than as a result of a Permitted Offer and subject to
certain exceptions)) and (ii) the close of business on the 10th
day following the commencement or public announcement of a tender
offer or exchange offer, the consummation of which would result
in a person or group of affiliated or associated persons becoming
an Acquiring Person.
A "Permitted Offer" is a tender offer or an exchange offer
for all outstanding Common Shares of the Company determined by
the Board of Directors of the Company, after receiving such
advice as it deems necessary and giving due consideration to all
relevant factors, to be in the best interests of the Company and
its stockholders.
Until the Distribution Date, (i) the Rights will be evidenced
by the Common Share certificates and will be transferred with and
only with the Common Shares, (ii) new Common Share certificates
issued after the Record Date upon transfer or new issuance of the
Common Shares will contain a notation incorporating the Rights
Agreement by reference, and (iii) the surrender for transfer of
any Common Share certificate, even without such notation or a
copy of this Summary of Rights attached thereto, will also
constitute the transfer of the Rights associated with the Common
Shares represented by such certificate.
As promptly as practicable following the Distribution Date,
separate certificates evidencing the Rights ("Right
Certificates") will be mailed to holders of record of the Common
Shares as of the close of business on the Distribution Date, and
such separate Right Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date.
The Rights will expire on April 30, 2007, unless extended or
earlier redeemed or exchanged by the Company as described below.
No fraction of a Preferred Share (other than fractions in
integral multiples of one one-hundredth of a share) will be
issued and, in lieu thereof, an adjustment in cash will be made
based on the closing price on the last trading date prior to the
date of exercise.
The Purchase Price payable and the number of Preferred Shares
issuable upon exercise of the Rights are subject to adjustment
from time to time to prevent dilution: (i) in the event of a
stock dividend on, or a subdivision, combination or
reclassification of, the Preferred Shares, (ii) upon the grant to
holders of the Preferred Shares of certain rights, options or
warrants to subscribe for or purchase Preferred Shares or
convertible securities at less than the then current market price
of the Preferred Shares or (iii) upon the distribution to holders
of the Preferred Shares of evidences of indebtedness or assets
(excluding regular periodic cash dividends or dividends payable
in Preferred Shares) or of subscription rights or warrants (other
than those described in clause (ii) of this paragraph). With
certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at
least 1% in the Purchase Price. The number of outstanding Rights
and the number of Preferred Shares issuable upon exercise of the
Rights are also subject to adjustment in the event of a stock
split of the Common Shares or a stock dividend on the Common
Shares payable in Common Shares or subdivisions, consolidations
or combinations of the Common Shares occurring, in any such case,
prior to the Distribution Date.
Preferred Shares purchasable upon exercise of the Rights will
not be redeemable. Each Preferred Share will be entitled to a
minimum preferential quarterly dividend payment of $1.00 per
share but will be entitled to an aggregate dividend of 100 times
the dividend declared per Common Share. In the event of
liquidation, the holders of the Preferred Shares will be entitled
to a minimum preferential liquidation payment of $100.00 per
share but will be entitled to an aggregate payment of 100 times
the payment made per Common Share. Each Preferred Share will
have 100 votes, voting together with the Common Shares. Finally,
in the event of any merger, consolidation or other transaction in
which Common Shares are exchanged, each Preferred Share will be
entitled to receive 100 times the amount received per Common
Share. These rights are subject to adjustment in the event of a
stock dividend on the Common Shares or a subdivision, combination
or consolidation of the Common Shares.
In the event any Person becomes an Acquiring Person, each
holder of a Right shall thereafter have a right to receive, upon
exercise thereof at the then current aggregate exercise price, in
lieu of Preferred Shares, such number of Common Shares of the
Company having a current aggregate market price equal to twice
the current aggregate exercise price. In the event that at any
time after there is an Acquiring Person the Company is acquired
in certain mergers or other business combination transactions or
50% or more of the assets or earning power of the Company and its
subsidiaries (taken as a whole) are sold, holders of the Rights
will thereafter have the Right to receive, upon exercise thereof
at the then current aggregate exercise price, such number of
Common Shares of the acquiring company (or, in certain cases, one
of its affiliates) having a current aggregate market price equal
to twice the current aggregate exercise price.
At any time after a Person becomes an Acquiring Person
(subject to certain exceptions), and prior to the acquisition by
a Person of 50% or more of the outstanding Common Shares, the
Board of Directors of the Company may exchange all or part of the
Rights for Common Shares at an exchange ratio of one Common Share
per right, subject to adjustment.
At any time before a Person has become an Acquiring Person,
the Board of Directors of the Company may redeem the Rights in
whole, but not in part, at a price of $0.01 per Right (the
"Redemption Price"), subject to adjustment. The redemption of
the Rights 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.
Until a Right is exercised, the holder thereof, as such, will
have no rights as a stockholder of the Company, including without
limitation, the right to vote or to receive dividends.
A copy of the Rights Agreement has been filed with the
Securities and Exchange Commission as an exhibit to a
Registration Statement on Form 8-A dated May 1, 1997. A copy of
the Rights Agreement is available free of charge from the Company
by contacting the Secretary, Interra Financial Incorporated, Xxxx
Xxxxxxxx Plaza, 60 South Sixth Street, Minneapolis, MN 55402-
4422. This summary description of the Rights does not purport to
be complete and is qualified in its entirety by reference to the
Rights Agreement, which is hereby incorporated herein by
reference.
