THIRD AMENDMENT TO RIGHTS AGREEMENT
Third Amendment to Rights Agreement (this "Amendment") entered
into as of this 21st day of July, 1998, by and between Northern Trust
Corporation, a Delaware corporation (the "Company"), and Norwest Bank
Minnesota, N.A., a national banking association, as Rights Agent (the
"Rights Agent").
The Company entered into a Rights Agreement with Xxxxxx Trust and
Savings Bank (the "Original Rights Agent") dated as of October 17, 1989, as
amended by a First Amendment thereto, dated as of September 17, 1997, and a
Second Amendment thereto, dated as of November 18, 1997 (as so amended, the
"Rights Agreement"). Capitalized terms used and not defined in this
Amendment have the meanings set forth in the Rights Agreement.
Effective November 10, 1997, the Rights Agent was appointed as
successor to the Original Rights Agent in accordance with Section 21 of the
Rights Agreement.
The parties desire to amend the Rights Agreement in accordance
with Section 27 of the Rights Agreement to provide for automatic redemption
of the Rights under certain limited circumstances as authorized by the
Board of Directors of the Company on the date hereof.
In consideration of the foregoing and for other good and valuable
consideration (the receipt and sufficiency of which are hereby
acknowledged), the Company and the Rights Agent hereby agree as follows.
1. Section 23 of the Rights Agreement is hereby amended in its entirety
to read as follows:
(a) The Board of Directors of the Company may, at its option, at
any time prior to the earliest to occur of (i) the date on which an
Automatic Redemption Event (as defined below) occurs pursuant to
paragraph (c) of this Section 23, (ii) the close of business on the
twentieth day after the Stock Acquisition Date or (iii) the Final
Expiration Date, redeem all but not less than all the then outstanding
Rights at a redemption price of $.01 per Right, as such amount may be
appropriately adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the date hereof (such redemption
price being hereafter referred to as the "Redemption Price");
provided, however, that if the Board of Directors of the Company
authorizes redemption of the Rights pursuant to this paragraph (a) in
either of the circumstances set forth in clauses (A) and (B) below,
there must be at least one Continuing Director and such authorization
shall require the approval of a majority of the Continuing Directors
then holding office: (A) such authorization occurs on or after the
Stock Acquisition Date; or (B) such authorization occurs on or after
the date of a change (resulting from a proxy or consent solicitation)
in a majority of the directors in office at the commencement of such
solicitation if any Person who is a participant in such solicitation
has stated that such Person (or any of its Affiliates or Associates)
intends to take or may consider taking, or if a majority of the Board
of Directors of the Company has determined in good faith that such
Person (or any of its Affiliates or Associates) intends or is likely
to take, any action which would result in such Person becoming an
Acquiring Person or which would cause the occurrence of any
transaction set forth in Section 11(a) (ii) or Section 13(a) hereof,
unless concurrent with such solicitation such Person (or one or more
of its Affiliates or Associates) is making a cash tender offer
pursuant to a Tender Offer Statement on Schedule 14D-1 (or any
successor form) filed with the Securities and Exchange Commission for
all outstanding shares of Common Stock of the type excepted from the
provisions of Section 11(a) (ii) (B) hereof; provided further, that
if, following the occurrence of a Stock Acquisition Date and following
the expiration of the right of redemption hereunder but prior to the
occurrence of any transaction set forth in Section 11(a) (ii) or
Section 13(a) hereof, (x) a Person who is an Acquiring Person shall
have transferred or otherwise disposed of a number of shares of Common
Stock in one transaction or series of transactions, not directly or
indirectly involving the Company or any of its subsidiaries, which did
not result in the occurrence of a transaction set forth in Section
11(a)(ii) or Section 13(a) hereof such that such Person is thereafter
a Beneficial Owner of shares of Common Stock and/or other securities
representing 10% or less of the Voting Power and (y) there are no
other Persons immediately following the occurrence of the event
described in clause (x) who are Acquiring Persons, then the right of
redemption shall be reinstated and thereafter be subject to the
provisions of this Section 23.
(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 Rights will terminate, and the only right thereafter of
the holders of Rights shall be to receive the Redemption Price.
Within ten business days after the action of the Board of Directors
ordering the redemption of the Rights pursuant to paragraph (a) of
this Section 23, the Company shall give notice of such redemption to
the holders of the then outstanding Rights by mailing such notice to
all such holders 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 Stock
(c) Notwithstanding anything contained in this Agreement to the
contrary, in the event that an Automatic Redemption Event occurs at
any time prior to the earliest to occur of (i) the date on which the
Board of Directors of the Company authorizes redemption of the Rights
pursuant to paragraph (a) of this Section 23, (ii) the close of
business on the twentieth day after the Stock Acquisition Date or
(iii) the Final Expiration Date, then effective immediately upon the
occurrence of such Automatic Redemption Event, by action of the Board
of Directors of the Company taken to approve the inclusion of this
paragraph (c) in Section 23 of the Agreement and without any further
action on the part of or notice from the Board of Directors of the
Company, the Rights shall be redeemed and shall terminate, and
thereafter, the only right of the holders of Rights shall be to
receive the Redemption Price. Each of the following shall be an
"Automatic Redemption Event":
(A) any Person (other than the Company or any of its
subsidiaries or any employee benefit plan of the Company or of any
subsidiary of the Company or any Person appointed as trustee by the
Company or such subsidiary pursuant to the terms of any such plan in
such Person's capacity as trustee) becomes the Beneficial Owner of
securities of the Company which in the aggregate represent 14% or more
of the Voting Power;
(B) any Person (other than the Company or any of its
subsidiaries or any employee benefit plan of the Company or of any
subsidiary of the Company or any Person appointed as trustee by the
Company or such subsidiary pursuant to the terms of any such plan in
such Person's capacity as trustee) commences, or publicly announces
its intent to commence, a tender or exchange offer if upon
consummation thereof such Person, together with all Affiliates and
Associates of such Person, would be the Beneficial Owner of securities
of the Company which in the aggregate represent 15% or more of the
Voting Power;
(C) any Person makes by public announcement or by written
communication that is or becomes the subject of a public announcement,
or publicly announces its intent to make, a bona fide proposal to the
Company or its stockholders for (1) a merger, consolidation or similar
transaction involving the Company or any of its subsidiaries, (2) a
purchase or other acquisition of all or a substantial portion of the
assets or deposits of the Company and its Subsidiaries or (3) a
purchase or other acquisition of securities representing 15% or more
of the Voting Power (any transaction of the type described in clauses
(1), (2) or (3) of this paragraph (C), an "Acquisition Transaction");
or
(D) any Person files an application or notice with the Board
of Governors of the Federal Reserve System, or any other federal or
state banking regulatory authority, which application or notice seeks
approval to engage in any transaction constituting an Acquisition
Transaction.
(d) Within ten business days after the Company becomes aware of
the occurrence of an Automatic Redemption Event, the Company shall
give notice of the redemption of the Rights to the holders of the then
outstanding Rights by mailing such notice to all such holders 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 Stock.
(e) Any notice of redemption which is mailed in the manner
provided in this Section 23 shall be deemed given, whether or not the
holder receives the notice. Such notice of redemption shall 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 and
other than in connection with the purchase or repurchase by any of
them of Common Stock prior to the Distribution Date. Moreover,
notwithstanding anything contained in this Agreement to the contrary,
the Rights shall not be exercisable after the first occurrence of a
transaction set forth in Section 11(a) (ii) hereof until such time as
the Company's right of redemption hereunder has expired.
2. The term "Agreement" as used in the Rights Agreement shall be deemed
to refer to the Rights Agreement as amended hereby, and all references
to the Rights Agreement shall be deemed to include this Amendment.
3. This Amendment shall be effective as of the date first written above,
and except as set forth herein, the Rights Agreement shall remain in
full force and effect and otherwise shall be unaffected hereby.
4. This Amendment may be executed in two or more counterparts, each of
which shall be deemed an original but all of which together shall
constitute one and the same instrument.
The parties hereto have caused this Amendment to be duly executed
as of the date first written above.
Attest: NORTHERN TRUST CORPORATION
/s/ Xxxx X. Xxxxx By /s/ Xxxxx X. Xxxx
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Name: Xxxx X. Xxxxx Name: Xxxxx X. Xxxx
Title: Secretary Title: Senior Executive Vice
President
Attest: NORWEST BANK MINNESOTA, N.A.
/s/ Xxxxxxx X. Xxxxx By /s/ Xxxxx X. Xxxxxx
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Name: Xxxxxxx X. Xxxxx Name: Xxxxx X. Xxxxxx
Title: Assistant Secretary Title: Assistant Vice President
