EXHIBIT 99.3
RIGHTS AGREEMENT
between
DIME COMMUNITY BANCORP, INC.
and
CHASEMELLON SHAREHOLDER SERVICES, L.L.C., AS RIGHTS AGENT
Dated as of April 9, 1998
TABLE OF CONTENTS
Section 1. Certain Definitions...................................................................................1
Section 2. Appointment of Rights Agent...........................................................................6
Section 3. Issue of Right Certificates...........................................................................6
Section 4. Form of Right Certificates............................................................................7
Section 5. Countersignature and Registration.....................................................................8
Section 6. Transfer, Split Up, Combination and Exchange of Right Certificates; Mutilated,
Destroyed, Lost or Stolen Right Certificates..........................................................8
Section 7. Exercise of Rights; Purchase Price; Expiration Date...................................................9
Section 8. Cancellation and Destruction of Right Certificates...................................................10
Section 9. Reservation and Availability of Capital Stock........................................................11
Section 10. Preferred Shares Record Date.........................................................................11
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...........................................18
Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power.................................18
Section 14. Fractional Rights and Fractional Shares..............................................................19
Section 15. Rights of Action.....................................................................................20
Section 16. Agreement of Right Holders...........................................................................21
Section 17. Right Certificate Holder Not Deemed a Stockholder....................................................21
Section 18. Concerning the Rights Agent..........................................................................21
Section 19. Merger or Consolidation or Change of Name of Rights Agent............................................22
Section 20. Terms and Conditions of Rights Agent's Appointment...................................................23
Section 21. Change of Rights Agent...............................................................................25
Section 22. Issuance of New Right Certificates...................................................................26
Section 23. Redemption...........................................................................................26
Section 24. Exchange.............................................................................................26
Section 25. Notice of Certain Events.............................................................................28
Section 26. Notices..............................................................................................28
Section 27. Supplements and Amendments...........................................................................29
Section 28. Successors...........................................................................................29
Section 29. Determinations and Actions by the Board of Directors.................................................30
Section 30. Benefits of this Agreement...........................................................................30
Section 31. Severability.........................................................................................30
Section 32. Governing Law........................................................................................30
Section 33. Counterparts.........................................................................................31
Section 34. Descriptive Headings.................................................................................31
Signatures .....................................................................................................32
Exhibit A - Form of Certificate of Designations, Preferences and Rights of
Series A Junior Participating Preferred Stock of Dime
Community Bancorp. Inc.
Exhibit B - Form of Right Certificate
Exhibit C - Summary of Rights to Purchase Preferred
Shares or Common Shares
RIGHTS AGREEMENT
This Rights Agreement ("Agreement"), is made as of the 9th day
of April, 1998, between Dime Community Bancorp, Inc., a Delaware corporation,
having an office at 000 Xxxxxxxxx Xxxxxx, Xxxxxxxx, Xxx Xxxx 00000 (the
"Company"), and ChaseMellon Shareholder Services, L.L.C., a Company organized
under the laws of the State of New Jersey, with its principal office at 00
Xxxxxxxxxx Xxxx, Xxxxxxxx Xxxxxx, Xxxxxxxxxx Xxxx, Xxx Xxxxxx 00000 ("Rights
Agent").
W I T N E S S E T H:
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WHEREAS, the Board of Directors of the Company desires to
provide all shareholders of the Company with the opportunity to benefit from the
long-term prospects and value of the Company and to ensure that all shareholders
of the Company receive fair and equal treatment in the event of any proposed
takeover of the Company; and
WHEREAS, on April 9, 1998 the Board of Directors of the
Company has authorized and declared a dividend of one preferred share purchase
right ("Right") for each Common Share (as such term is hereinafter defined) of
the Company outstanding at the close of business on May 1, 1998 (the "Record
Date"), each Right representing the right to purchase one one-hundredth (subject
to adjustment) interest in a Preferred Share (as such term is hereinafter
defined), upon the terms and subject to the conditions herein set forth, and has
further authorized and directed the issuance of one Right (subject to
adjustment) 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);
NOW, THEREFORE, in consideration of the premises and the
mutual agreements hereinafter set forth, the parties hereby agree as follows:
Section 1. CERTAIN DEFINITIONS.
For purposes of this Agreement, the following terms have the
meanings indicated:
(A) ACQUIRING PERSON. The term "Acquiring Person"
shall mean any Person (as such term is hereinafter defined) who or
which, together with all Affiliates and Associates (as such terms are
hereinafter defined) of such Person, shall be the Beneficial Owner (as
such term is hereinafter defined) of 10% or more of the Common Shares
(as such term is hereinafter defined) of the Company then outstanding,
but shall not include the Company, any Subsidiary (as such term is
hereinafter defined) of the Company, any employee benefit plan of the
Company or any Subsidiary of the Company or any entity holding Common
Shares for or pursuant to the terms of any such plan. 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 10% or more of
the Common Shares of the Company then outstanding; provided, however,
that if a Person
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becomes the Beneficial Owner of 10% 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, become
the Beneficial Owner of any additional Common Shares of the Company,
then such Person shall be deemed to be an "Acquiring Person" unless
upon the consummation of the acquisition of such additional Common
Shares such Person does not own 10% or more of the Common Shares then
outstanding.
Notwithstanding the foregoing, if (i) a Person who would
otherwise be an "Acquiring Person" became such inadvertently
(including, without limitation, because (A) such Person was unaware
that it beneficially owned a percentage of Common Shares that would
otherwise cause such Person to be an "Acquiring Person," or (B) such
Person was aware of the existence of its Beneficial Ownership of Common
Shares but had no actual knowledge of the consequences of such
Beneficial Ownership under this Agreement) and without any intention of
changing or influencing control of the Company, but in no event if such
Person beneficially owned or owns in excess of 11% of the Common Shares
of the Company then outstanding, and if such Person as promptly as
practicable, but in no event later than ten (10) business days after
becoming aware of such ownership of Common Shares of the Company or of
such consequences, divested or divests itself of Beneficial Ownership
of a sufficient number of Common Shares so that such person would no
longer be an "Acquiring Person," or (ii) the Board of Directors of the
Company otherwise determines in good faith that a Person who would
otherwise be an "Acquiring Person" became such inadvertently, then such
Person shall not be deemed to be or to have become an "Acquiring
Person" for any purposes of this Agreement.
(B) AFFILIATE. The term "Affiliate" (whether referred
to as an "affiliate" of, or a Person "affiliated" with, a specified
Person) shall mean a Person that directly, or indirectly through one or
more intermediaries, controls, or is controlled by, or is under common
control with, the Person specified.
(C) ASSOCIATE. The term "Associate," when used to
indicate a relationship with any Person, shall mean:
(i) any Company or organization (other than
the Company or a Subsidiary of the Company) of which
such Person is an officer or partner or is, directly
or indirectly, either alone or together with one or
more members of his immediate family, the Beneficial
Owner of 10% or more of any class of equity
securities;
(ii) any trust or other estate in which such
Person has a substantial beneficial interest or as to
which such Person serves as a trustee or in a similar
fiduciary capacity; and
(iii) any relative or spouse of such Person
or any relative of such spouse, who has the same home
as such Person or who is a director or officer of the
Company or any of its Subsidiaries or Affiliates.
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(D) BENEFICIAL OWNER. 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;
(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 the
Rights issued hereunder), 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 Securities Exchange Act of
1934, as amended (the "Exchange Act"), and (2) is not
also then reportable under the Exchange Act on
Schedule 13D under the Rules and Regulations of the
Securities and Exchange Commission (or any comparable
or successor reports); 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 Section 1(d)(ii)(B) hereof) or disposing
of any securities of the Company.
Notwithstanding the foregoing, none of the Company's
directors, officers, employees or financial advisors shall be deemed to be the
Beneficial Owner of, or to beneficially own, any Common Shares owned by any
other director, officer, employee or financial advisor of the Company by virtue
of such persons acting in their capacities as such, including, without
limitation, in connection with any formulation and publication of the Board of
Directors' recommendation of a position, and any actions taken in furtherance
thereof, with respect to any
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acquisition proposal relating to the Company, any tender or exchange offer for
the Common Shares, or any solicitation of proxies with respect to the Common
Shares.
(E) BUSINESS DAY. The term "Business Day" shall mean
any day other than a Saturday, a Sunday or a day on which banking
institutions in the State of New York are authorized or obligated by
law or executive order to close.
(F) CLOSE OF BUSINESS. The term "Close of Business"
on any given date shall mean 5:00 P.M., New York City time, on such
date; provided, however, that if such date is not a Business Day it
shall mean 5:00 P.M., New York City time, on the next succeeding
Business Day.
(G) COMMON SHARES. The term "Common Shares" when used
with reference to the Company shall mean the shares of common stock,
par value $.01 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 another
Person, the Person or Persons that ultimately control such
first-mentioned Person.
(H) CONTINUING DIRECTOR. The term "Continuing
Director" shall mean any member of the Board of Directors of the
Company who is not an officer, an Acquiring Person, is not affiliated
with or an Associate of an Acquiring Person and who either (1) was a
member of the Board of Directors prior to the Shares Acquisition Date
or (2) was recommended for election by a majority of the Continuing
Directors in office at the time such director was nominated for
election.
(I) DISTRIBUTION DATE. The term "Distribution Date"
shall have the meaning set forth in Section 3 hereof.
(J) EXCHANGE ACT. The term "Exchange Act" shall have
the meaning set forth in Section 1(d) hereof.
(K) EXCHANGE RATIO. The term "Exchange Ratio" shall
have the meaning set forth in Section 24(a) hereof.
(L) FINAL EXPIRATION DATE. The term "Final Expiration
Date" shall have the meaning set forth in Section 7(a) hereof.
(M) NASDAQ. The term "NASDAQ" shall have the meaning
set forth in Section 11(a)(iv) hereof.
(N) PERSON. The term "Person" shall mean
any individual, firm, Company, partnership, trust, association or
other entity, and shall include any successor (by merger or otherwise)
of such entity.
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(O) PREFERRED SHARES. The term "Preferred Shares"
shall mean shares of Series A Junior Participating Preferred Stock, par
value $.01 per share, of the Company having the rights and preferences
set forth in the form of Exhibit A hereto.
(P) PURCHASE PRICE. The term "Purchase Price" shall
have the meaning set forth in Section 4 hereof.
(Q) REDEMPTION DATE. The term "Redemption Date" shall
have the meaning set forth in Section 7(a) hereof.
(R) REDEMPTION PRICE. The term "Redemption Price"
shall have the meaning set forth in Section 23(b) hereof.
(S) RECORD DATE. The term "Record Date" shall mean
the Close of Business on May 1, 1998.
(T) RIGHT CERTIFICATE. The term "Right Certificate"
shall have the meaning set forth in Section 3 hereof having the
characteristics set forth in Exhibit B hereto.
(U) RULES AND REGULATIONS. The term "Rules and
Regulations" shall mean the applicable rules and regulations
promulgated by the Securities and Exchange Commission, or any
applicable federal or state regulatory agency or authority that has
jurisdiction over the Company at the relevant time.
(V) SECURITIES ACT. The term "Securities Act" shall
have the meaning set forth in Section 11(a)(iv) hereof.
(W) SECURITY. The term "Security" shall have the
meaning set forth in Section 11(d)(i) hereof.
(X) SHARES ACQUISITION DATE. The term "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 an Acquiring Person that an Acquiring Person has
become such.
(Y) SUBSIDIARY. The term "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.
(Z) SUMMARY OF RIGHTS. The term "Summary of Rights"
shall have the meaning set forth in Section 3(c) hereof.
(AA) TRADING DAY. The term "Trading Day" shall mean a
day on which the principal national securities exchange on which the
Security (as such term is hereinafter defined) is listed or admitted to
trading is open for the transaction of business or, if the
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Security is not listed or admitted to trading on any national
securities exchange, a Business Day.
(bb) VOTING STOCK. The term "Voting Stock" shall mean (i) the
Common Shares of the Company and (ii) any other shares of capital stock
of the Company entitled to vote generally in the election of directors
or entitled to vote together with the Common Shares in respect of any
merger, consolidation, sale of all or substantially all of the
Company's assets, liquidation, dissolution or winding up.
Section 2. APPOINTMENT OF RIGHTS AGENT.
The Company hereby appoints the Rights Agent to act as agent
for the Company in accordance with the terms and conditions hereof, and the
Rights Agent hereby accepts such appointment. The Company may from time to time
appoint such co-Rights Agents as it may deem necessary or desirable upon ten
days' prior written notice to the Rights Agent. The Rights Agent shall have no
liability for or duty to supervise any such co-Rights Agent.
Section 3. ISSUE OF RIGHT CERTIFICATES.
(a) From the date hereof until, but not including, the
Distribution Date, (i) the Rights will be evidenced (subject to the provisions
of Section 3(c) hereof) by the certificates for Common Shares registered in the
names of the holders thereof and not by separate Right Certificates, and (ii)
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 notify the Rights Agent of the occurrence of
the Distribution Date, and 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, at the Company's expense, send) by first-class,
insured, postage-paid mail, to each record holder of Common Shares as of the
Close of Business on the Distribution Date, at the address of such holder shown
on the records of the Company, a Right Certificate, in substantially the form of
Exhibit B hereto (a "Right Certificate"), evidencing one Right (subject to
adjustment) for each Common Share so held. As of the Distribution Date, the
Rights will be evidenced solely by such Right Certificates.
(b) For purposes of the foregoing, the Distribution Date shall
be the earlier of (i) the Close of Business on the twentieth Business Day after
the Shares Acquisition Date or (ii) the Close of Business on the twentieth
Business Day (or such later date as may be determined by the Board of Directors
of the Company by at least a majority of the Continuing Directors, in its sole
discretion) after the date of the commencement by any Person (other than the
Company, any Subsidiary of the Company, any employee benefit plan of the Company
or of any Subsidiary of the Company or any entity holding Common Shares for or
pursuant to the terms of any such plan) of, or of the first public announcement
of the intention of any Person (other than the Company, any Subsidiary of the
Company, any employee benefit plan of the Company or of any Subsidiary of the
Company or any entity holding Common Shares of the Company for or pursuant to
the terms of any such plan) to commence, a tender or exchange offer the
consummation of which would result in any Person becoming the Beneficial Owner
of Common Shares of the Company
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aggregating 10% or more of the then outstanding Common Shares (including any
such date that is after the date of this Agreement and prior to the issuance of
the Rights).
(c) On the Record Date, or as soon as practicable thereafter,
the Company will send a copy of a Summary of Rights to Purchase Preferred Shares
or Common Shares, in substantially the form of Exhibit C hereto (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 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), 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,
shall also constitute the transfer of the Rights associated with the Common
Shares represented thereby.
(d) Certificates for Common Shares that become outstanding
(including, without limitation, reacquired Common Shares referred to in this
paragraph (d)) 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
Dime Community Bancorp, Inc. and ChaseMellon Shareholder
Services, L.L.C., as Rights Agent, dated as of April 9, 1998,
as the same may be amended from time to time, (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 Dime Community Bancorp, Inc. 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. Dime
Community Bancorp, Inc. will mail to the holder of this
certificate a copy of the Rights Agreement without charge
after receipt of a written request therefor. As described in
the Rights Agreement, Rights owned by any Person who is or
becomes an Acquiring Person (as defined in the Rights
Agreement) and certain transferees thereof shall 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 certificates 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 cancelled and retired so that the Company shall
not be entitled to exercise any Rights associated with the Common Shares that
are no longer outstanding. The Rights Agent shall deem any such Right
Certificates not outstanding if it has actual knowledge that they are owned by
the Company.
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Section 4. FORM OF RIGHT CERTIFICATES.
The Right Certificates (and the form of election to purchase
Preferred Shares and the form of assignment printed on the reverse thereof)
shall be substantially in the form of Exhibit B hereto. The Right Certificates
shall be in machine printable format and in a form reasonably satisfactory to
the Rights Agent, 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 on which the Rights may from time to time be listed, or to conform to
usage. Subject to the provisions of Section 22 hereof, the Right Certificates
shall entitle the holders thereof to purchase such number of one one-hundredth
interests in a Preferred Share as shall be set forth therein at the price per
one one-hundredth interest in a Preferred Share set forth therein (the "Purchase
Price"), but the number of such one one-hundredth interests in a Preferred Share
and the Purchase Price shall be subject to adjustment as provided herein.
Section 5. COUNTERSIGNATURE AND REGISTRATION.
(a) The Right Certificates shall be executed on behalf of the
Company by its Chairman of the Board, its President or any Vice President,
either manually or by facsimile signature, shall have affixed thereto the
Company's seal or a facsimile thereof and shall be attested by the Secretary or
an Assistant Secretary of the Company, either manually or by facsimile
signature. The Right Certificates shall be countersigned and dated by an
authorized signatory of the Rights Agent either manually or by facsimile
signature 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.
(b) Following the Distribution Date, the Rights Agent will
keep or cause to be kept, at its designated 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. In case any authorized signatory of the
Rights Agent who shall have countersigned any of the Right Certificates shall
cease to be such signatory before delivery of the Right Certificates by the
Company, such Right Certificates, nevertheless, may be issued and delivered by
the Company with the same force and effect as though the person who
countersigned such Right Certificates had not ceased to be such signatory; and
any Right Certificate may be countersigned on behalf of the Rights Agent by any
person who, at the actual date of the countersignature of such Right
Certificate, shall be a proper signatory of the Rights
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Agent to countersign such Right Certificate, although at the date of the
execution of this Agreement any such person was not such a signatory.
Section 6. Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost Or Stolen Right
Certificates.
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(a) Subject to the provisions of Section 14 hereof, at any
time after the Close of Business on the Distribution Date, and at or prior to
the Close of Business on the earlier of the Redemption Date or the Final
Expiration Date, any Right Certificate or Right Certificates (other than Right
Certificates representing Rights that have become void pursuant to Section
11(a)(ii) hereof or that have been exchanged pursuant to Section 24 hereof) 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-hundredth interests in 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
designated office of the Rights Agent, along with a signature guarantee and such
other and further documentation as the Rights Agent may reasonably require.
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 from the holders of such Right Certificate. The Company may require
payment from the holders of Rights of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer, split
up, combination or exchange of Right Certificates.
(b) Upon receipt by the Company and the Rights Agent of
evidence reasonably satisfactory to them of the loss, theft, destruction or
mutilation of a Right Certificate, and, in case of loss, theft or destruction,
of indemnity or security reasonably satisfactory to them, and, at the Company's
or the Rights Agent's request, reimbursement to the Company and the Rights Agent
of all reasonable expenses incidental thereto, and upon surrender of the Right
Certificate and a signature guarantee and such other and further documentation
as the Rights Agent may reasonably require to the Rights Agent and cancellation
of the Right Certificate if mutilated, the Company will make and deliver a new
Right Certificate of like tenor to the Rights Agent for countersignature and
delivery to the registered holder in lieu of the Right Certificate so lost,
stolen, destroyed or mutilated.
Section 7. EXERCISE OF RIGHTS; PURCHASE PRICE; EXPIRATION DATE.
(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 designated office of the
Rights Agent, together with payment of the Purchase Price for each one
one-hundredth interest in a Preferred Share as to which the Rights are
exercised, at or prior to the earliest of (i) the Close of May 1, 2008 (the
"Final Expiration Date"), (ii) the time at which the Rights are redeemed as
provided in Section 23 hereof (the "Redemption Date") or (iii) the time at which
such Rights are
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exchanged as provided in Section 24 hereof. The Company shall provide the Rights
Agent with a prompt written notice of the occurrence of any of the events
provided for in this Section 7(a).
(b) The Purchase Price for each one one-hundredth interest in
a Preferred Share pursuant to the exercise of a Right shall initially be $100
all be subject to adjustment from time to time as provided in Sections 11 and 13
hereof and shall be payable in lawful money of the United States of America in
accordance with paragraph (c) below.
(c) Upon receipt of a Right Certificate representing
exercisable Rights, with the form of election to purchase duly executed,
accompanied by payment of the 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 hereof by certified
check, cashier's check or money order payable to the order of the Company, the
Rights Agent shall thereupon promptly (i) (A) requisition from any transfer
agent of the Preferred Shares 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) requisition from the depositary agent
depositary receipts representing interests in such number of one one-hundredth
interests in a Preferred Share as are to be purchased (in which case
certificates for the Preferred Shares represented by such receipts shall be
deposited by the transfer agent with the depositary agent), and the Company
hereby directs the depositary agent to comply with all such requests, (ii) when
appropriate, requisition from the Company the amount of cash to be paid in lieu
of issuance of fractional shares in accordance with Section 14 hereof, (iii)
after receipt of such certificates or depositary receipts, cause the same to be
delivered to or upon the order of the registered holder of such Right
Certificate, registered in such name or names as may be designated by such
holder and (iv) when appropriate, after receipt, deliver such cash to or upon
the order of the registered holder of such Right Certificate. The provisions of
this Section 7(c) shall apply whenever cash or securities (such as Common
Shares) may be received in lieu of the Preferred Shares upon exercise of the
Rights and surrender of the Right Certificates.
(d) In case the registered holder of any Right Certificate
shall exercise less than all the Rights evidenced thereby, a new Right
Certificate evidencing Rights equivalent to the Rights remaining unexercised
shall be issued by the Rights Agent to the registered holder of such Right
Certificate or to his duly authorized assigns, subject to the provisions of
Section 14 hereof.
(e) The Company covenants and agrees that it 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
in accordance with this Section 7.
Section 8. CANCELLATION AND DESTRUCTION OF RIGHT CERTIFICATES.
All Right Certificates surrendered for the purpose of
exercise, transfer, split up, combination or exchange shall, if surrendered to
the Company or to any of its agents, be delivered to the Rights Agent for
cancellation or in cancelled form, or, if surrendered to the Rights Agent, shall
be cancelled by it, and no Right Certificates shall be issued in lieu thereof
except as expressly permitted by any of the provisions of this Rights Agreement.
The Company shall deliver to the
-11-
Rights Agent for cancellation and retirement, and the Rights Agent shall so
cancel and retire, any other Right Certificate purchased or acquired by the
Company otherwise than upon the exercise thereof. The Rights Agent shall deliver
all cancelled Right Certificates to the Company, or shall, at the written
request of the Company, destroy such cancelled Right Certificates, and in such
case shall deliver a certificate of destruction thereof to the Company.
Section 9. RESERVATION AND AVAILABILITY OF CAPITAL STOCK.
(a) The Company covenants and agrees that it will take all
such action as may be necessary to ensure that all Preferred Shares delivered
upon exercise of Rights (and, following the date on which a person becomes an
Acquiring Person, out of its authorized and unissued Common Shares and/or other
securities or out of its authorized and issued shares held in the treasury)
shall, at the time of delivery of the certificates for such Preferred Shares or
Common Shares (subject to payment of the Purchase Price), be duly authorized,
validly issued and fully paid and nonassessable shares.
(b) The Company further covenants and agrees that it will pay
when due and payable any and all federal and state transfer taxes and charges
which may be payable in respect of the issuance or delivery of the Right
Certificates or of any Preferred Shares or Common Shares upon the exercise of
Rights. The Company shall not, however, be required to pay any transfer tax
which may be payable in respect of any transfer or delivery of Right
Certificates to a person other than, or the issuance or delivery of certificates
or depositary receipts for the Preferred Shares or Common Shares in a name other
than that of, the registered holder of the Right Certificates evidencing Rights
surrendered for transfer, delivery or exercise or to issue or to deliver any
certificates or depositary receipts for Preferred Shares or Common 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 Certificates 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 Preferred Shares
transfer books of the Company 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 the Preferred Shares transfer books of
the Company are open. Prior to the exercise of the Rights evidenced thereby, the
holder of a Right Certificate shall not be entitled to any rights of a holder of
Preferred Shares 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.
-12-
Section 11. ADJUSTMENT OF PURCHASE PRICE, NUMBER AND KIND OF
SHARES OR NUMBER OF RIGHTS.
The Purchase Price, the number of Preferred Shares or other
securities or interests therein 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 or interests therein
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 or
interests therein 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 or interests therein of the Company issuable upon exercise of one
Right.
(ii) Subject to Section 24 hereof, in the event any
Person shall become an Acquiring Person, each holder of a Right shall
have the right to receive, upon exercise thereof at a price equal to
the then current Purchase Price multiplied by the number of one
one-hundredth interests in a Preferred Share for which a Right is then
exercisable (regardless of whether the Right is then exercisable), in
accordance with the terms of this Agreement and in lieu of interests in
Preferred Shares, such number of Common Shares of the Company as shall
equal the result obtained by (A) multiplying the then current Purchase
Price by the number of one one-hundredth interests in a Preferred Share
for which a Right is then exercisable (regardless of whether the Right
is then exercisable) and dividing that product by (B) 50% of the then
current per share market price of the Company's Common Shares
(determined pursuant to Section 11(d) hereof) on the date such Person
became an Acquiring Person; provided, however, that the Purchase Price
and the number of Common Shares so purchasable upon exercise of a Right
shall, following the occurrence of such event, be subject to further
adjustment as appropriate in accordance with Section 11(f) hereof. 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
(except as permitted under Sections 24 and 27 hereof) that would
eliminate or diminish the benefits intended to be afforded by the
Rights, except as provided in Section 23(b) hereof. Notwithstanding
anything in this Agreement to the contrary, from and after the time any
Person becomes an Acquiring Person, any Rights that are or were
acquired or beneficially
-13-
owned by such 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 hereof that represents Rights beneficially owned by an
Acquiring Person or any Associate or Affiliate thereof whose Rights
would be void pursuant to the preceding sentence; no Right Certificate
shall be issued at any time upon the transfer of any Rights to an
Acquiring Person or any Associate or Affiliate thereof or to any
nominee of such Acquiring Person, Associate or Affiliate whose Rights
would be void pursuant to the preceding sentence. Where a Right
Certificate is delivered to the Rights Agent for transfer to an
Acquiring Person or an Associate or Affiliate thereof, and the Rights
Agent has actual knowledge or has received notice from the Company
that the transferee is an Acquiring Person or an Associate or
Affiliate thereof, that Right Certificate shall be cancelled. The
Rights Agent shall have no liability for canceling Right Certificates
so delivered for transfer.
(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) of this paragraph (a), (A) the Company
shall take all such action as may be necessary to authorize additional
Common Shares for issuance upon exercise of the Rights or (B) the
Company, at its option, notwithstanding any other provision of this
Agreement, with respect to each Right, to the extent permitted by
applicable law and any agreements or instruments in effect on the
Distribution Date to which the Company is a party, upon exercise of the
Rights, may pay cash and/or securities equal to the Purchase Price per
Right, in lieu of issuing such additional Common Shares and requiring
payment therefor. To the extent that any legal or contractual
restrictions prevent the Company from paying the full amount of cash
and/or securities payable in accordance with the foregoing sentence,
the Company shall pay to holders of the Rights as to which such
payments are being made all amounts which are not then restricted on a
pro rata basis. The Company shall continue to make payments on a pro
rata basis as funds become available until such payments have been paid
in full. The Company shall provide the Rights Agent with written notice
of any election made pursuant to this Section 11(a)(iii).
(iv) In the event that the Rights become exercisable
or exchangeable under the provisions of this Agreement, the Company
covenants and agrees to use its best efforts to (A) cause a
registration statement under the Securities Act of 1933, as amended
(the "Securities Act"), or, if the Securities Act is not applicable,
under the comparable federal or state securities laws applicable to the
Common Shares and Preferred Shares, as in effect on the date in
question, and under the applicable Rules and Regulations thereunder, on
an appropriate form, with respect to the shares purchasable upon
exercise of the Rights or exchangeable for such Rights, to remain
effective (with a prospectus or offering circular at all times meeting
the requirements of the Securities Act or any other applicable federal
or state law) until the Final Expiration Date; (B) qualify or register
the Common Shares or Preferred Shares purchasable upon exercise of the
Rights under the blue sky laws of such jurisdictions as may be
necessary or appropriate; and (C) list the shares purchasable upon
exercise of the Rights on each national securities exchange on which
shares of the
-14-
same class or series were listed prior to exercisability of the Rights
or, if such shares are not listed or admitted to the trading on any
national securities exchange, with the National Association of
Securities Dealers, Inc. Automated Quotation System ("NASDAQ") or such
other system then in use. The Company covenants and agrees to bear the
full cost of any registration, qualification or listing required under
this Section 11(a)(iv).
(b) In case the Company shall fix a record date for the
issuance of rights, options or warrants to all holders of Preferred
Shares entitling them (for a period expiring within 45 calendar days
after such record date) to subscribe for or purchase Preferred Shares
(or shares having the same rights, privileges and preferences as the
Preferred Shares ("equivalent preferred shares")) or securities
convertible into Preferred Shares or equivalent preferred shares at a
price per Preferred Share or equivalent preferred share (or having a
conversion price per share, if a security convertible into Preferred
Shares or equivalent preferred shares) less than the then current per
share market price of the Preferred Shares (as defined in Section 11(d)
hereof) on such record date, the Purchase Price to be in effect after
such record date shall be determined by multiplying the Purchase Price
in effect immediately prior to such record date by a fraction, the
numerator of which shall be the number of Preferred Shares outstanding
on such record date plus the number of Preferred Shares which the
aggregate offering price of the total number of Preferred Shares and/or
equivalent preferred shares so to be offered (and/or the aggregate
initial conversion price of the convertible securities so to be
offered) would purchase at such current market price and the
denominator of which shall be the number of Preferred Shares
outstanding on such record date plus the number of additional Preferred
Shares and/or equivalent preferred shares to be offered for
subscription or purchase (or into which the convertible securities so
to be offered are initially convertible); provided, however, that in no
event shall the consideration to be paid upon the exercise of one Right
be less than the aggregate par value of the shares of capital stock or
interests therein of the Company issuable upon exercise of one Right.
In case such subscription price may be paid in a consideration part or
all of which shall be in a form other than cash, the value of such
consideration shall be as determined in good faith by the Board of
Directors of the Company by at least a majority of the Continuing
Directors, whose determination shall be described in a statement filed
with the Rights Agent and binding upon the Rights Agent and the holders
of the Rights. Preferred Shares owned by or held for the account of the
Company shall not be deemed outstanding for the purpose of any such
computation. Such adjustments 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 that 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) hereof), the Purchase Price to be in effect after such record
date shall be determined by multiplying the Purchase Price in effect
-15-
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 by at least a
majority of the Continuing Directors, whose determination shall be
described in a statement filed with the Rights Agent and binding upon
the Rights Agent and the holders of the Rights) 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 (or interests
therein) 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 that
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 exdividend 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 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.
(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)
hereof. If the Preferred Shares are not publicly traded, the "current
per share market price" of the Preferred Shares shall be conclusively
deemed to
-16-
be the current per share market price of the Common Shares as
determined pursuant to Section 11(d)(i) hereof (appropriately adjusted
to reflect any stock split, stock dividend or similar transaction
occurring after the date hereof), multiplied by 100. If neither the
Common Shares nor the Preferred Shares are publicly held or so listed
or traded, "current per share market price" shall mean the fair value
per share as determined in good faith by the Board of Directors of the
Company, whose determination shall be described in a statement filed
with the Rights Agent and binding upon the Rights Agent and the
holders of the Preferred Shares.
(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
that 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 interest in a Preferred Share
or one ten-thousandth interest in 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 that
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) hereof, the holder of any Right thereafter exercised shall become
entitled to receive any shares of capital stock of the Company other
than Preferred Shares or interests therein, thereafter the Purchase
Price and 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 Sections
11(a), (b), (c), (e), (h), (i) and (m) hereof, as applicable, and the
provisions of Sections 7, 9, 10, 13 and 14 hereof with respect to the
Preferred Shares shall apply on like terms to any such other shares.
The Company shall provide the Rights Agent with prompt written notice
of any such election to utilize other securities, the type of
securities and the exchange ratio of Right Certificates therefor.
(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-hundredth interests in 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) hereof, upon each adjustment of the Purchase
Price as a result of the calculations made in Sections 11(b) and (c)
hereof, 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-hundredth interests in
a Preferred Share (calculated to the nearest one one-millionth interest
in a Preferred Share) obtained by (i) multiplying (x) the number of one
one-hundredths interests covered by a Right immediately prior to this
adjustment by (y) the Purchase Price in effect immediately prior to
such adjustment
-17-
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-hundredth
interests in 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-hundredth interests in 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 and shall simultaneously provide the Rights Agent with written
notice of such election to adjust, which announcement and notice shall
indicate the record date for the adjustment and, if known at the time,
the amount of the adjustment to be made. This record date may be the
date on which the Purchase Price is adjusted or any day thereafter but,
if the Right Certificates have been issued, shall be at least 10 days
later than the date of the public announcement. If Right Certificates
have been issued, upon each adjustment of the number of Rights pursuant
to this Section 11(i), the Company shall, as promptly as practicable,
cause to be distributed to holders of record of Right Certificates on
such record date Right Certificates evidencing, subject to Section 14
hereof, the additional Rights to which such holders shall be entitled
as a result of such adjustment or, at the option of the Company, shall
cause to be distributed to such holders of record in substitution and
replacement for the Right Certificates held by such holders prior to
the date of adjustment, and upon surrender thereof along with a
signature guarantee and such other and further documentation as the
Rights Agent may reasonably require, if required by the Company, new
Right Certificates evidencing all the Rights to which such holders
shall be entitled after such adjustment. The Company shall provide the
Rights Agent with written notice of the occurrence of any distribution
effected pursuant to the foregoing. Right Certificates so to be
distributed shall be issued, executed and countersigned in the manner
provided for herein and shall be registered in the names of the holders
of record of Right Certificates on the record date specified in the
public announcement.
(j) Irrespective of any adjustment or change in the Purchase
Price or the number of one one-hundredth interests in 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-hundredth interests in a Preferred
Share that were expressed in the initial Right Certificates issued
hereunder but shall be deemed to represent the Purchase Price and the
number of one one-hundredth interests in a Preferred Share as adjusted
pursuant to the terms hereof.
(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
-18-
that 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. The Company shall give the Rights Agent
prompt written notice of its election to defer the issuance of
Preferred Shares.
(m) Anything in this Section 11 to the contrary
notwithstanding, the Company shall be entitled to make such reductions
in the Purchase Price, in addition to those adjustments expressly
required by this Section 11, as and to the extent that it in its sole
discretion shall determine to be advisable in order that any
consolidation or subdivision of the Preferred Shares, issuance wholly
for cash of any Preferred Shares at less than the current market price,
issuance wholly for cash of Preferred Shares or securities that by
their terms are convertible into or exchangeable for Preferred Shares,
dividends on Preferred Shares payable in Preferred Shares or issuance
of rights, options or warrants referred to hereinabove in Section 11(b)
hereof, hereafter made by the Company to holders of its Preferred
Shares shall not be taxable to such shareholders.
(n) 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-hundredth
interests in a Preferred Share purchasable after such event upon proper
exercise of each Right shall be determined by multiplying the number of
one one-hundredth interests in a Preferred Share so purchasable
immediately prior to such event by a fraction, the numerator of which
is the number of Common Shares outstanding immediately before such
event and the denominator of which is the number of Common Shares
outstanding immediately after such event, and (ii) each Common Share
outstanding immediately after such event shall have issued with respect
to it that number of Rights that each Common Share outstanding
immediately prior to such event had issued with respect to it. The
adjustments provided for in this Section 11(n) shall be made
successively whenever such a dividend is declared or paid or such a
subdivision, combination or consolidation is effected.
-19-
Section 12. CERTIFICATE OF ADJUSTED PURCHASE PRICE OR NUMBER OF
SHARES.
Whenever an adjustment is made as provided in Sections 11 and
13 hereof, the Company shall promptly (a) prepare a certificate setting forth
such adjustment, including, but not limited to, the adjusted Purchase Price and
a brief statement of the facts accounting for such adjustment, (b) file with the
Rights Agent and with each transfer agent for the Common Shares or the Preferred
Shares a copy of such certificate and (c) mail a brief summary thereof to each
holder of a Right Certificate in accordance with Section 25 hereof. The Rights
Agent may rely, and shall incur no liability for relying upon, the most recent
such certificate that it has received.
Section 13. CONSOLIDATION, MERGER OR SALE OR TRANSFER OF ASSETS
OR EARNING POWER.
In the event, directly or indirectly, at any time after a
Person has become an Acquiring Person, (a) the Company shall consolidate with,
or merge with and into, any other Person, (b) any Person shall consolidate with
the Company, or merge with and into the Company and the Company shall be the
continuing or surviving corporation of such merger and, in connection with such
merger, all or part of the Common Shares shall be changed into or exchanged for
stock or other securities of any other Person (or the Company) or cash or any
other property, or (c) 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, proper provision shall be made so
that (i) each holder of a Right (except as otherwise provided herein) shall
thereafter have the right to receive, upon the exercise thereof at a price equal
to the then current Purchase Price multiplied by the number of one one-hundredth
interests in 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 such other Person (including the Company as
successor thereto or as the surviving corporation) as shall equal the result
obtained by (A) multiplying the then current Purchase Price by the number of one
one-hundredth interests in a Preferred Share for which a Right is then
exercisable and (B) dividing that product by 50% of the then current per share
market price of the Common Shares of such other Person (determined pursuant to
Section 11(d) hereof) on the date of consummation of such consolidation, merger,
sale or transfer; (ii) the issuer of such Common Shares shall thereafter be
liable for, and shall assume, by virtue of such consolidation, merger, 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
issuer; and (iv) such issuer shall take such steps (including, but not limited
to, the reservation of a sufficient number of its Common Shares in accordance
with Section 9 hereof and the making of payments in cash and/or securities equal
to the Purchase Price in accordance with Section 11(a)(iii) hereof) in
connection with such consummation as may be necessary to assure that the
provisions hereof shall thereafter be applicable, as nearly as reasonably may
be, in relation to the Common Shares thereafter deliverable upon the exercise of
the Rights. The Company shall not consummate any such consolidation, merger,
sale or transfer unless prior thereto the Company and such issuer shall have
executed and delivered to the Rights Agent a supplemental agreement so
providing. The prior written consent of the Rights Agent must be obtained in
connection with any such supplemental agreement that alters the rights or duties
of the Rights Agent. The Company shall
-20-
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 that, as a result of
the consummation of such transaction, would eliminate or substantially diminish
the benefits intended to be afforded by the Rights. The provisions of this
Section 13 shall similarly apply to successive mergers or consolidations or
sales or other transfers. The Rights Agent may rely, and shall be fully
protected in relying, on a certificate of the Company stating that the
provisions of this Section 13 have been fulfilled.
Section 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES.
(a) The Company shall not be required to issue fractions of
Rights or to distribute Right Certificates that 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 fractional
interests in Preferred Shares (other than fractional interests that are integral
multiples of one one-hundredth of a Preferred Share) upon exercise of the Rights
or to distribute certificates that evidence fractional interests in Preferred
Shares (other than fractions that are integral multiples of one one-hundredth of
a Preferred Share). Fractional interests in 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, that
such agreement shall provide that the holders of such depositary receipts shall
have all the rights, privileges and preferences to which they are entitled as
beneficial owners of the Preferred Shares represented by such depositary
receipts, and provided, further, that the Company shall notify the Rights Agent
of any such election pursuant to this Section 14(b). In lieu of fractional
interests in 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
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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 the
second sentence of Section 11(d)(i) hereof) for the Trading Day immediately
prior to the date of such exercise.
(c) Upon accepting a Right, the holder of such 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 hereof, are
vested in the respective registered holders of the Right Certificates (and,
prior to the Distribution Date, the registered holders of the Common Shares);
and any registered holder of any Right Certificate (or, prior to the
Distribution Date, of the Common Shares), without the consent of the Rights
Agent or of the holder of any other Right Certificate (or, prior to the
Distribution Date, of the Common Shares), may, in 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 designated office of the Rights Agent, duly endorsed
or accompanied by a proper instrument of transfer along with a
signature guarantee and such other and further documentation as the
Rights Agent may reasonably require; 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
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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 interests therein or any other securities of the Company
that 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 shareholders at any meeting
thereof, or to give or withhold consent to any corporate action, or to receive
notice of meetings or other actions affecting shareholders (except as provided
in Section 25 hereof), or to receive dividends or subscription rights, or
otherwise, until the Right or Rights evidenced by such Right Certificate shall
have been exercised in accordance with the provisions hereof.
Section 18. CONCERNING THE RIGHTS AGENT.
(a) The Company agrees to pay to the Rights Agent such
compensation as shall be agreed to in writing between the Company and the Rights
Agent 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 (including reasonable attorneys' disbursements) incurred in the
administration and execution of this Agreement and the exercise and performance
of its duties hereunder. The Company also agrees to indemnify the Rights Agent
for, and to hold it harmless against, any loss, liability or expense incurred
without negligence, bad faith or willful misconduct on the part of the Rights
Agent, for anything done or omitted by the Rights Agent in connection with the
acceptance and administration of this Agreement, including reasonable attorneys'
fees and expenses and the costs and expenses of defending against any claim of
liability in the premises. In no case will the Rights Agent be liable for
special, indirect, incidental or consequential loss or damage of any kind
whatsoever (including but not limited to lost profits), even if the Rights Agent
has been advised of the possibility of such damages. Any liability of the Rights
Agent will be limited to the amount of fees paid by the Company hereunder. This
Section 18(a) shall survive the termination of this Agreement.
(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 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, instructions or other paper or document believed by it
to be genuine and to be signed and executed by the proper person or persons and,
where necessary, verified or acknowledged, or otherwise upon the advice of
counsel as set forth in Section 20 hereof.
-23-
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 hereto, provided that such corporation would
be eligible for appointment as a successor Rights Agent under the provisions of
Section 21 hereof. In case at the time such successor Rights Agent shall succeed
to the agency created by this Agreement and 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. TERMS AND CONDITIONS OF RIGHTS AGENT'S APPOINTMENT.
The Rights Agent undertakes the duties and obligations imposed
by this Agreement upon the following terms and conditions, to 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 of its
selection (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
-24-
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 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
hereof (except the due execution hereof by the Rights Agent) or in
respect of the validity or execution of any Right Certificate (except
its countersignature thereof); nor shall it be responsible for any
breach by the Company of any covenant or condition contained in this
Agreement or in any Right Certificate; nor shall it be responsible for
any change in the exercisability of the Rights (including the Rights
becoming void pursuant to Section 11(a)(ii) hereof) or any adjustment
in the terms of the Rights (including the manner, method or amount
thereof) provided for in Section 3, 11, 13, 23 or 24 hereof, 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 actual notice that such change or
adjustment is required); 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 agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed,
acknowledged and delivered all such further and other acts, instruments
and assurances as may reasonably be required by the Rights Agent for
the carrying out or performance 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 and certificates delivered pursuant to any provision hereof
from the Chairman of the Board, the Chief Executive Officer, the
President, any Vice President, the Secretary, any Assistant Secretary,
the Treasurer or any Assistant Treasurer of the Company, and is
authorized 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
such instructions of any such officer. An application by the Rights
Agent for instructions may set forth in writing any action proposed to
be taken or omitted by the Rights Agent with respect to its duties and
obligations under this Agreement and the date on and/or after which
such actions shall be taken, and the Rights Agent shall not be liable
for any action taken or omitted in accordance with a proposal included
in any such application on or after the date specified therein (which
date shall not be less than one Business Day after the Company receives
such application) without the consent of the Company unless prior to
taking or omitting
-25-
such action, the Rights Agent has received written instructions in
response to such application specifying the actions to be taken or
omitted.
(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 the Rights Agent shall have reasonable
grounds for believing the repayment of such funds or adequate
indemnification against such risk or liability is not reasonably
assured to it.
(k) In addition to the foregoing, the Rights Agent shall be
protected and shall incur no liability for, or in respect of, any
action taken or omitted by it in connection with its administration of
this Agreement in reliance upon (i) the proper execution of the
certification concerning beneficial ownership appended to the Form of
Assignment and the Form of Election to Purchase included as part of
Exhibit B hereto (the "Certification"), unless the Rights Agent shall
have actual knowledge that, as executed, the Certification is untrue or
(ii) the non-execution or failure to complete the Certification
including, without limitation, any refusal to honor any otherwise
permissible assignment or election by reason of such nonexecution or
failure.
(l) The Company agrees to give the Rights Agent prompt written
notice of any event or ownership that comes to the Company's attention
that would prohibit the exercise or transfer of the Right Certificates.
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, at the Company's expense, to each transfer
agent of the Common Shares or Preferred Shares by registered or certified mail,
and to the holders of the Right Certificates by first class mail. The Company
may remove the Rights Agent or any successor Rights Agent upon 30 days' notice
in writing, mailed to the Rights Agent or successor Rights Agent, as the case
may be, and to each
-26-
transfer agent of the Common Shares or Preferred Shares by registered or
certified mail, and to the holders of the Right Certificates by first class
mail. If the Rights Agent shall resign or be removed or shall otherwise become
incapable of acting, the Company shall appoint a successor to the Rights Agent.
If the Company shall fail to make such appointment within a period of 30 days
after giving notice of such removal or after it has been notified in writing of
such resignation or incapacity by the resigning or incapacitated Rights Agent or
by the holder of a Right Certificate (who shall, with such notice, submit his
Right Certificate for inspection by the Company), then the Company shall become
the Rights Agent, and 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 either (a) a corporation or an affiliate thereof organized and
doing business under the laws of the United States or of the State of 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 New York), in
good standing, having an office in the State of New York, that 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 at the time of its appointment as Rights Agent a combined capital and
surplus of at least $50 million or (b) an affiliate of such a corporation. After
appointment, the successor Rights Agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally named as Rights
Agent without further act or deed; but the predecessor Rights Agent shall
deliver and transfer to the successor Rights Agent any property at the time held
by it hereunder and execute and deliver any further assurance, conveyance, act
or deed necessary for the purpose. Not later than the effective date of any such
appointment, the Company shall file notice thereof in writing with the
predecessor Rights Agent and each transfer agent of the Common Shares or
Preferred Shares and mail a notice thereof in writing to the registered holders
of the Right Certificates. Failure to give any notice provided for in this
Section 21, however, or any defect therein, shall not affect the legality or
validity of the resignation or removal of the Rights Agent or the appointment of
the successor Rights Agent, as the case may be.
Section 22. ISSUANCE OF NEW RIGHT CERTIFICATES.
Notwithstanding any of the provisions of this Rights Agreement
or of the Rights to the contrary, the Company may, at its option, issue new
Right Certificates evidencing Rights in such form as may be approved by its
Board of Directors to reflect any adjustment or change in the Purchase Price and
the number or kind or class of shares or other securities or property
purchasable under the Right Certificates made in accordance with the provisions
of this Agreement.
Section 23. REDEMPTION.
(a) The Rights may be redeemed by action of the Board of
Directors of the Company pursuant to paragraph (b) of this Section 23 and shall
not be redeemed in any other manner. The Rights Agent shall be given written
notice of any such redemption.
(b) The Board of Directors of the Company may, at its option,
at any time prior to such time as any Person becomes an Acquiring Person, redeem
all but not less than all the then outstanding Rights at a redemption price of
$.01 per Right, appropriately adjusted to reflect any
-27-
stock split, stock dividend or similar transaction occurring after the date
hereof (such redemption price being hereinafter referred to as the "Redemption
Price").
(c) Immediately upon the action of the Board of Directors of
the Company ordering the redemption of the Rights pursuant to paragraph (b) of
this Section 23, and without any further action and without any notice, the
right to exercise the Rights will terminate, and the only right thereafter of
the holders of Rights shall be to receive the Redemption Price. The Company
shall promptly give public notice of any such redemption; provided, however,
that the failure to give, or any defect in, any such notice shall not affect the
validity of such redemption. Within 10 days after such action of the Board of
Directors ordering the redemption of the Rights pursuant to Section 23(b)
hereof, 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 that 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.
Section 24. EXCHANGE.
(a) The Board of Directors of the Company may, at its sole
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)
hereof) 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 hereof (such exchange ratio being
hereinafter referred to as the "Exchange Ratio"). The Rights Agent shall be
given written notice of any such exchange and the Exchange Ratio pursuant to
which such exchange is effected. Notwithstanding the foregoing, the Board of
Directors shall not be empowered to effect such exchange at any time after any
Person (other than the Company, any Subsidiary of the Company, any employee
benefit plan of the Company or any such Subsidiary or any entity holding Common
Shares for or pursuant to the terms of any such plan), 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, and the
Rights Agent shall be given written 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 shall promptly 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 or, prior
to the Distribution Date, on the registry books of the transfer agent for the
Common Shares. Any notice that 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
-28-
for Rights will be effected and, in the event of any partial exchange, the
number of Rights that will be exchanged. Any partial exchange shall be effected
pro rata based on the number of Rights (other than Rights that have become void
pursuant to the provisions of Section 11(a)(ii) hereof) held by each holder of
Rights.
(c) In any exchange pursuant to this Section 24, the Company,
at its option, may substitute interests in Preferred Shares (or equivalent
preferred shares, as such term is defined in Section 11(b) hereof) for Common
Shares exchangeable for Rights, at the initial rate of one one-hundredth
interest in a Preferred Share (or equivalent preferred share) for each Common
Share, as appropriately adjusted to reflect adjustments in the voting rights of
the Preferred Shares pursuant to Section 3(a) of Exhibit A hereto so that the
fraction of a Preferred Share delivered in lieu of each Common Share shall have
the same voting rights as one Common Share. The Rights Agent shall be given
written notice of any such substitution.
(d) In the event that there shall not be sufficient Common
Shares or Preferred Shares issued but not outstanding or authorized but unissued
to permit any exchange of Rights as contemplated in accordance with this Section
24, (i) the Company shall take all such action as may be necessary to authorize
additional Common Shares or Preferred Shares for issuance upon exchange of the
Rights or (ii) the Company, at is option, notwithstanding any other provision of
this Agreement, with respect to each Right, to the extent permitted by
applicable law and any agreements or instruments in effect on the Distribution
Date to which the Company is a party, upon exercise of the Rights, may pay cash
and/or securities equal to the Purchase Price per Right, in lieu of issuing such
additional Common Shares and requiring payment therefor. To the extent that any
legal or contractual restrictions prevent the Company from paying the full
amount of cash payable in accordance with the foregoing sentence, the Company
shall pay to holders of the Rights as to which such payments are being made all
amounts that are not then restricted on a pro rata basis. The Company shall
continue to make payments on a pro rata basis as funds become available until
such payments have been paid in full. The Company shall provide the Rights Agent
with written notice of any election made pursuant to this Section 24(d).
(e) The Company shall not be required to issue fractions of
Common Shares or to distribute certificates that evidence fractional Common
Shares. In lieu of such fractional Common Shares, the Company shall pay to the
registered holders of the Right Certificates with regard to which such
fractional Common Shares would otherwise be issuable an amount in cash equal to
the same fraction of the current market value of a whole Common Share. For the
purposes of this paragraph (e), the current market value of a whole Common Share
shall be the closing price of a Common Share (as determined pursuant to the
second sentence of Section 11(d)(i) hereof) for the Trading Day immediately
prior to the date of exchange pursuant to this Section 24.
Section 25. NOTICE OF CERTAIN EVENTS.
(a) In case the Company shall propose (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
-29-
Shares or shares of stock of any class or any other securities, rights or
options, (iii) to effect any reclassification of its Preferred Shares (other
than a reclassification involving only the subdivision of outstanding Preferred
Shares), (iv) to effect any consolidation or merger into or with, or to effect
any sale or other transfer (or to permit one or more of its Subsidiaries to
effect any sale or other transfer), in one or more transactions, of 50% or more
of the assets or earning power of the Company and its Subsidiaries (taken as a
whole) to, any other Person, (v) to effect the liquidation, dissolution or
winding up of the Company or (vi) to declare or pay any dividend on the Common
Shares payable in Common Shares or to effect a subdivision, combination or
consolidation of the Common Shares (by reclassification or otherwise than by
payment of dividends in Common Shares), then, in each such case, the Company
shall give to each holder of a Right Certificate and the Rights Agent, in
accordance with Section 26 hereof, a notice of such proposed action, which shall
specify the record date for the purposes of such stock dividend, or distribution
of rights or warrants, or the date on which such reclassification,
consolidation, merger, sale, transfer, liquidation, dissolution or winding up is
to take place and the date of participation therein by the holders of the Common
Shares and/or Preferred Shares, if any such date is to be fixed, and such notice
shall be so given in the case of any action covered by clause (i) or (ii) above
at least 10 days prior to the record date for determining holders of the
Preferred Shares for purposes of such action, and in the case of any such other
action, at least 10 days prior to the date of the taking of such proposed action
or the date of participation therein by the holders of the Common Shares and/or
Preferred Shares, whichever shall be earlier.
(b) In case an event set forth in Section 11(a)(ii) hereof
shall occur, then the Company shall as soon as practicable thereafter give to
each holder of a Right Certificate and to the Rights Agent, in accordance with
Section 26 hereof, a notice of the occurrence of such event, which notice shall
describe the event and the consequences of the event to holders of Rights under
Section 11(a)(ii) hereof.
Section 26. NOTICES.
Notices or demands authorized by this Agreement to be given or
made by the Rights Agent or by the holder of any Right Certificate to or on the
Company, shall be sufficiently given or made if sent by first-class mail,
postage prepaid, addressed (until another address is filed in writing with the
Rights Agent) as follows:
Dime Community Bancorp, Inc.
000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Subject to the provisions of Section 21 hereof, any notice or demand authorized
by this Agreement to be given or made by the Company or by the holder of any
Right Certificate to or on the Rights Agent shall be sufficiently given or made
if sent by first-class mail, postage prepaid, addressed (until another address
is filed in writing with the Company) as follows:
-00-
XxxxxXxxxxx Xxxxxxxxxxx Services, L.L.C.
00 Xxxxxxxxxx Xxxx
Xxxxxxxx Xxxxxx
Xxxxxxxxxx Xxxx, Xxx Xxxxxx 00000
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Right Certificate shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed to such holder at the address of such holder as shown on the registry
books of the Company.
Section 27. SUPPLEMENTS AND AMENDMENTS.
The Company may, at any time prior to the time a Person
becomes an Acquiring Person, by resolution of its Board of Directors, from time
to time supplement or amend this Agreement without the approval of any holders
of Right Certificates in any respect, any such supplement or amendment to be
evidenced by a writing signed by the Company and the Rights Agent; provided,
however, that from and after such time as any Person becomes an Acquiring
Person, this Agreement may be amended only by resolution of its Board of
Directors adopted by a majority of the Continuing Directors (which resolution
shall be effective only if the Continuing Directors constitute a majority of the
number of directors then in office), and provided further, that the Rights Agent
shall not be required to consent to any amendment or supplement that is adverse
to its interests. Without limiting the foregoing, the Company may, at any time
prior to such time as any Person becomes an Acquiring Person, amend this
Agreement to lower the thresholds set forth in Sections 1(a) and 3(b) hereof to
not less than the largest percentage of the outstanding Common Shares then known
by the Company to be beneficially owned by any 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. DETERMINATIONS AND ACTIONS BY THE BOARD OF DIRECTORS.
(a) The Board of Directors of the Company (including, where
specifically provided for herein, the Continuing Directors) shall have the
exclusive power and authority to administer this Agreement and to exercise all
rights and powers specifically granted to such Board of Directors (including,
where specifically provided for herein, the Continuing Directors) or to the
Company, or as may be necessary or advisable in the administration of this
Agreement, including, without limitation, the right and power to (i) interpret
the provisions of this Agreement and (ii) make all determinations deemed
necessary or advisable for the administration of this Agreement (including,
without limitation, a determination to redeem or not redeem the Rights or to
amend the Agreement). All such actions, interpretations and determinations
(including, for purposes of clause (y) below, all omissions with respect to the
foregoing) that are done or made by the Board of Directors of the Company or the
Continuing Directors in good faith, shall (x) be final, conclusive and binding
on the Company, the Rights Agent, the holders of the Rights and all other
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parties and (y) not subject the Board of Directors of the Company (or the
Continuing Directors) to any liability to the holders of the Rights.
(b) In taking any action referred to in Section 29(a), the
Board of Directors and the Continuing Directors shall be entitled to consider,
without limitation, the financial and managerial resources and future prospects
of an Acquiring Person, the possible effects of the action on the business of
the Company and its Subsidiaries and on the employees, customers, suppliers and
creditors of the Company and its Subsidiaries and the effects on the communities
in which the Company's and its Subsidiaries' facilities are located.
Section 30. BENEFITS OF THIS AGREEMENT.
Nothing in this Agreement shall be construed to give to any
person or corporation other than the Company, the Rights Agent and the
registered holders of the Right Certificates (and, prior to the Distribution
Date, the Common Shares) any legal or equitable right, remedy or claim under
this Agreement; but this Agreement shall be for the sole and exclusive benefit
of the Company, the Rights Agent and the registered holders of the Right
Certificates (and, prior to the Distribution Date, the Common Shares).
Section 31. 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 32. 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 33. 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 34. DESCRIPTIVE HEADINGS.
Descriptive headings of the several Sections of this Agreement
are inserted for convenience only and shall not control or affect the meaning or
construction of any of the provisions hereof.
-32-
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and attested, all as of the day and year first
above written.
Dime Community Bancorp, Inc.
By:/s/ Xxxxxxx X. Xxxxxx
-------------------------------------
Xxxxxxx X. Xxxxxx
President and Chief Operating Officer
Attest:
By: /s/ Xxxxxxx X. Xxxxxx
----------------------------
Xxxxxxx X. Xxxxxx
Vice President and Secretary
CHASEMELLON SHAREHOLDER
SERVICES, L.L.C., as Rights Agent
By: /s/ Xxxxxx Xxxxxxxx
----------------------------
Xxxxxx Xxxxxxxx
Assistant Vice President
Attest:
By: /s/ Xxxxx Xxxxx
----------------------------
Xxxxx Xxxxx
Vice President
EXHIBIT A
CERTIFICATE OF DESIGNATIONS, PREFERENCES AND RIGHTS OF
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
of
DIME COMMUNITY BANCORP, INC.
Pursuant to Section 151 of the General Corporation Law
of the State of Delaware
--------------------------
We, Xxxxxxx X. Xxxxxx, and Xxxxxxx X. Xxxxxx, being the
President and Chief Operating Officer and the Vice President and Secretary,
respectively, of Dime Community Bancorp, Inc., a corporation organized and
existing under the General Corporation Law of the State of Delaware (the
"Corporation"), in accordance with the provisions of Sections 103 and 151
thereof, DO HEREBY CERTIFY:
That, pursuant to the authority conferred upon the Board of
Directors by the Certificate of Incorporation of the Corporation, the Board of
Directors of the Corporation at a meeting duly called and held on April 9, 1998,
at which a quorum was present and acting throughout, duly adopted the following
resolution creating a series of 450,000 shares of Preferred Stock, par value
$.01 per share, designated "Series A Junior Participating Preferred Stock":
RESOLVED, that pursuant to the authority vested in
the Board of Directors of the Corporation in accordance with
the provisions of its Certificate of Incorporation, a series
of preferred stock of the Corporation to be designated "Series
A Junior Participating Preferred Stock", par value $.01 per
share ("Preferred Stock"), be, and it hereby is, created, and
the designations and amount thereof and the voting powers,
preferences and relative, participating, optional and other
special rights of the shares of such series, and the
qualifications, limitations and restrictions thereof, [are as
follows]:
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK:
Section 1. DESIGNATION AND AMOUNT.
The shares of such series shall be designated as "Series A
Junior Participating Preferred Stock," par value $.01 per share, and the number
of shares constituting such series shall be 450,000. Such number of shares may
be increased or decreased by resolution of the Board of Directors of the
Corporation (the "Board of Directors"); provided, that no decrease shall reduce
the number of shares of Series A Junior Participating Preferred Stock to a
number less than the
-2-
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 Series A Junior Participating Preferred Stock.
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 Series A Junior Participating Preferred Stock with respect to dividends, the
holders of shares of Series A Junior Participating Preferred Stock, in
preference to the holders of Common Stock, par value $.01 per share (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 Series A Junior Participating Preferred Stock, in an
amount per share (rounded to the nearest cent) equal to the greater of (a) $1 or
(b) 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
Series A Junior Participating Preferred Stock. In the event the Corporation
shall at any time 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 than
by payment of a dividend in shares of Common Stock) into a greater or lesser
number of shares of Common Stock, then in each such case the amount to which
holders of shares of Series A Junior Participating Preferred Stock were entitled
immediately prior to such event under clause (b) 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 Series A Junior Participating Preferred Stock 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);
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
per share on the Series A Junior Participating Preferred Stock shall
nevertheless be payable on such subsequent Quarterly Dividend Payment Date.
-3-
(c) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Junior Participating Preferred Stock from the
Quarterly Dividend Payment Date next preceding the date of issue of such shares,
unless the date of issue of such shares is prior to the record date for the
first Quarterly Dividend Payment Date, in which case dividends on such shares
shall begin to accrue from the date of issue of such shares, or unless the date
of issue is a Quarterly Dividend Payment Date or is a date after the record date
for the determination of holders of shares of Series A Junior Participating
Preferred Stock entitled to receive a quarterly dividend and before such
Quarterly Dividend Payment Date, in either of which events such dividends shall
begin to accrue and be cumulative from such Quarterly Dividend Payment Date.
Accrued but unpaid dividends shall not bear interest. Dividends paid on the
shares of Series A Junior Participating Preferred Stock in an amount less than
the total amount of such dividends at the time accrued and payable on such
shares shall be allocated pro rata on a share-by-share basis among all such
shares at the time outstanding. The Board of Directors may fix a record date for
the determination of holders of shares of Series A Junior Participating
Preferred Stock 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.
The holders of shares of Series A Junior Participating
Preferred Stock shall have the following voting rights:
(a) Subject to the provision for adjustment hereinafter set
forth, each share of Series A Junior Participating Preferred Stock
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 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 than by payment of a dividend in
shares of Common Stock) 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 Series A Junior Participating Preferred
Stock were entitled immediately prior to such event shall be adjusted
by multiplying such number by a fraction, the numerator of which is the
number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such event.
(b) Except as otherwise provided herein, in any other
resolution creating a series of preferred stock or any similar stock,
in any amendment to the Certificate of Incorporation of the Corporation
or by law, the holders of shares of Series A Junior Participating
Preferred Stock and the holders of shares of Common Stock and any other
capital stock of the Corporation having general voting rights shall
vote together as one class on all matters submitted to a vote of
stockholders of the Corporation.
-4-
(c) Except as set forth herein, or as otherwise provided by
law, holders of Series A Junior Participating Preferred Stock shall
have no special voting rights and their consent shall not be required
(except to the extent they are entitled to vote with holders of Common
Stock as set forth herein) for taking any corporate action.
Section 4. CERTAIN RESTRICTIONS.
(a) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Junior Participating Preferred Stock as
provided in Section 2 are in arrears, thereafter and until all accrued and
unpaid dividends and distributions, whether or not declared, on shares of Series
A Junior Participating Preferred Stock 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 Series A Junior
Participating Preferred Stock;
(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
Series A Junior Participating Preferred Stock, except dividends paid
ratably on the Series A Junior Participating Preferred Stock and all
such parity stock on which dividends are payable or in arrears in
proportion to the total amounts to which the holders of all such shares
are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the Series
A Junior Participating Preferred Stock, provided 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 Series A Junior Participating
Preferred Stock; or
(iv) redeem or purchase or otherwise acquire for consideration
any shares of Series A Junior Participating Preferred Stock, or any
shares of stock ranking on a parity with the Series A Junior
Participating Preferred Stock, except in accordance with a purchase
offer made in writing or by publication (as determined by the Board of
Directors) to all holders of such shares upon such terms as the Board
of Directors, after consideration of the respective annual dividend
rates and other relative rights and preferences of the respective
series and classes, shall determine in good faith will result in fair
and equitable treatment among the respective series or classes.
(b) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any shares of
stock of the Corporation unless the
-5-
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 shares of Series A Junior Participating Preferred Stock
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 a
resolution of the Board of Directors, in the Certificate of Incorporation of the
Corporation, or in any other Certificate of Amendment 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 (a) to the holders of shares of stock
ranking junior (either as to dividends or upon liquidation, dissolution or
winding up) to the Series A Junior Participating Preferred Stock unless, prior
thereto, the holders of shares of Series A Junior Participating Preferred Stock
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 shares of Common
Stock, or (b) to the holders of shares of stock ranking on a parity (either as
to dividends or upon liquidation, dissolution or winding up) with the Series A
Junior Participating Preferred Stock, except distributions made ratably on the
Series A Junior Participating Preferred Stock 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 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 than by payment of a dividend in shares of Common Stock) 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 Series A Junior Participating
Preferred Stock were entitled immediately prior to such event under the proviso
in clause (a) 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 Series A
-6-
Junior Participating Preferred Stock 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 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 than by payment of a dividend in shares
of Common Stock) 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 Series A Junior Participating Preferred
Stock shall be adjusted by multiplying such amount by a fraction, the numerator
of which is the number of shares of Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of Common Stock
that were outstanding immediately prior to such event.
Section 8. NO REDEMPTION.
The shares of Series A Junior Participating Preferred Stock
shall not be redeemable, except as otherwise provided herein.
Section 9. RANK.
The Series A Junior Participating Preferred Stock shall rank,
with respect to the payment of dividends and the distribution of assets, junior
to all other series of the Corporation's preferred stock.
Section 10. AMENDMENT.
At any time that any shares of Series A Preferred Stock are
outstanding, the Certificate of Incorporation of the Corporation shall not be
amended in any manner, nor shall the Board of Directors take any action, which
would materially alter or change the powers, preferences or special rights of
the Series A Junior Participating Preferred Stock so as to affect them adversely
without the affirmative vote of the holders of at least two-thirds of the
outstanding shares of Series A Junior Participating Preferred Stock, voting
together as a single class.
Section 11. FRACTIONAL SHARES.
Series A Junior Participating Preferred Stock may be issued in
fractions of a share, which shall entitle the holder, in proportion to such
holder's fractional shares, to exercise voting rights, receive dividends,
participate in distributions and to have the benefit of all other rights of
holders of Series A Junior Participating Preferred Stock.
-7-
IN WITNESS WHEREOF, Dime Community Bancorp, Inc. has caused
this certificate to be executed by its President and Chief Operating Officer and
by its Vice President and Secretary this 9th day of April, 1998.
Dime Community Bancorp, Inc.
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------
Xxxxxxx X. Xxxxxx
President and Chief Operating Officer
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------
Xxxxxxx X. Xxxxxx
Vice President and Secretary
EXHIBIT B
Form of Right Certificate
Certificate No. R- __ Rights
NOT EXERCISABLE AFTER MAY 1, 2008, OR, IF EARLIER, IF
REDEMPTION OR EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO
REDEMPTION AT $0.01 PER RIGHT AND TO EXCHANGE ON THE TERMS SET
FORTH IN THE RIGHTS AGREEMENT. ANY RIGHTS BENEFICIALLY OWNED
BY OR TRANSFERRED TO AN ACQUIRING PERSON OR AN AFFILIATE OR
ASSOCIATE THEREOF OR ANY SUBSEQUENT HOLDER OF SUCH RIGHTS MAY
BECOME VOID AND WILL NO LONGER BE TRANSFERABLE.
Right Certificate
DIME COMMUNITY BANCORP, INC.
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 9, 1998, as the same may be amended from time to
time (the "Rights Agreement"), by and between Dime Community Bancorp, Inc., a
Delaware corporation (the "Corporation"), and ChaseMellon Shareholder Services,
L.L.C., a New Jersey banking corporation (the "Rights Agent"), to purchase from
the Corporation at any time after the Distribution Date (as such term is defined
in the Rights Agreement) and prior to 5:00 P.M., New York City time, on May 1,
2008 at the designated office of the Rights Agent, or at the office of its
successor as Rights Agent, one one-hundredth interest in a fully paid
non-assessable share of Series A Junior Participating Preferred Stock, par value
$0.01 per share (the "Preferred Shares"), of the Corporation, at a purchase
price of $100 per one one-hundredth interest in a Preferred Share (the "Purchase
Price"), upon presentation and surrender of this Right Certificate with the Form
of Election to Purchase duly executed, along with a signature guarantee and such
other and further documentation as the Rights Agent may reasonably require. The
number of Rights evidenced by this Right Certificate (and the number of one
one-hundredths interests in Preferred Shares that may be purchased upon exercise
hereof) set forth above, and the Purchase Price set forth above, are the number
and Purchase Price as of --------, ---------, 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 interests in Preferred Shares
-2-
that 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 Corporation and the holders of the Right Certificates.
Copies of the Rights Agreement are on file at the principal executive offices of
the Corporation and the above-mentioned offices of the Rights Agent.
This Right Certificate, with or without other Right
Certificates, upon surrender at the designated office of the Rights Agent, along
with a signature guarantee and such other and further documentation as the
Rights Agent may reasonably require, 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 interests in
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 be, and under certain circumstances are
required to be, redeemed by the Corporation at a redemption price of $0.01 per
Right or (ii) may be exchanged in whole or in part for Preferred Shares or
shares of the Corporation's Common Stock, par value $0.01 per share.
No fractional interests in Preferred Shares will be issued
upon the exercise of any Right or Rights evidenced hereby (other than fractional
interests that are integral multiples of one one-hundredth of a Preferred Share,
which may, at the election of the Corporation, 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 Corporation that 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 Corporation 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.
-3-
WITNESS the facsimile signature of the proper officers of the
Corporation and its corporate seal. Dated as of ________, ____.
DIME COMMUNITY BANCORP, INC.
By:
----------------------------
Name:
Office:
Attest:
By:
----------------------------
Name:
Title:
Countersigned:
ChaseMellon Shareholder Services, L.L.C.,
as Rights Agent
By:
----------------------------
Authorized Signatory
Dated: ----------------------------, ----------
-4-
Form of Reverse Side of Right Certificate
FORM OF ASSIGNMENT
(To be executed by the registered holder if such holder desires to
transfer the Right Certificate.)
FOR VALUE RECEIVED ___________________________ hereby sells,
assigns and transfers unto ____________________________________________________
(Please print name and address of transferee)
this Right Certificate, together with all right, title and interest therein, and
does hereby irrevocably constitute and appoint Attorney, to transfer the within
Right Certificate on the books of Dime Community Bancorp, Inc. with full power
of substitution.
Dated: ----------------------------, 19--
----------------------------
Signature
Signature Guarantee:
Signatures must be guaranteed by a member firm of a registered
national securities exchange, a member of the National Association of Securities
Dealers, Inc., or a commercial bank or trust company having an office or
correspondent in the City of New York.
--------------------------------------------------------------------------------
The undersigned hereby certifies that the Rights evidenced by
this Right Certificate are not beneficially owned by an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement).
----------------------------
Signature
--------------------------------------------------------------------------------
-5-
[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: DIME COMMUNITY BANCORP, INC.
The undersigned hereby irrevocably elects to exercise _______
Rights represented by this Right Certificate to purchase the interests in
Preferred Shares issuable upon the exercise of such Rights and requests that
certificates for such interests in Preferred Shares be issued in the name of:
----------------------------
----------------------------
----------------------------
(Please print name and address)
----------------------------
(Please insert social security or
other taxpayer identification number)
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 print name and address)
----------------------------
(Please insert social security or
other taxpayer identification number)
Dated: ______________________, 19
----------------------------
Signature
Signature Guarantee:
-6-
Signatures must be guaranteed by a member firm of a registered
national securities exchange, a member of the National Association of Securities
Dealers, Inc., or a commercial bank or trust company having an office or
correspondent in the City of New York.
-7-
[Form of Reverse Side of Right Certificate -- continued]
The undersigned hereby certifies that the Rights evidenced by
this Right Certificate are not beneficially owned by an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement).
----------------------------
Signature
--------------------------------------------------------------------------------
NOTICE
The signature in the foregoing Forms of Assignment and
Election must conform to the name as written upon the face of this Right
Certificate in every particular, without alteration or enlargement or any change
whatsoever.
In the event the certification set forth above in the Form of
Assignment or the Form of Election to Purchase, as the case may be, is not
completed, the Corporation and the Rights Agent will deem the beneficial owner
of the Rights evidenced by this Right Certificate to be an Acquiring Person or
an Affiliate or Associate thereof (as defined in the Rights Agreement), and such
Assignment or Election to Purchase will not be honored.
EXHIBIT C
SUMMARY OF RIGHTS TO PURCHASE
PREFERRED SHARES OR COMMON STOCK
ANY RIGHTS BENEFICIALLY OWNED BY OR TRANSFERRED TO AN ACQUIRING PERSON
OR AN AFFILIATE OR ASSOCIATE THEREOF OR ANY SUBSEQUENT HOLDER OF SUCH
RIGHTS MAY BECOME VOID AND WILL NO LONGER BE TRANSFERABLE.
1. IN GENERAL.
On April 9, 1998, the Board of Directors of Dime Community
Bancorp, Inc. (the "Company") declared a dividend of one preferred share
purchase right (the "Right") for each outstanding share of common stock, par
value $0.01 per share (the "Common Stock"), of the Company. The dividend is
payable on May 1, 1998 (the "Record Date") to the shareholders of record on that
date. Each Right entitles the registered holder to purchase from the Company one
one-hundredth interest in a share of Series A Junior Participating Preferred
Stock, par value $.01 per share (the "Preferred Shares"), of the Company, at a
price of $100 per one one-hundredth interest in a Preferred Share (the "Purchase
Price"), subject to adjustment. The description and terms of the Rights are set
forth in a Rights Agreement, as the same may be amended from time to time (the
"Rights Agreement") dated as of April 9, 1998 between the Company and
ChaseMellon Shareholder Services, L.L.C., as Rights Agent (the "Rights Agent").
2. DISTRIBUTION DATE.
Until the date on which certain events take place (the
"Distribution Date"), the Rights will be evidenced by, with respect to any
Common Stock certificate outstanding on the Record Date, such Common Stock
certificate with a copy of this Summary of Rights attached thereto. The term
"Distribution Date" means the earlier of (a) the 20th business day following a
public announcement that a person or group of affiliated or associated persons
has acquired beneficial ownership of 10% or more of the outstanding Common Stock
(collectively, an "Acquiring Person") or (b) the 20th business day (or such
later date as may be determined by the Board of Directors of the Company)
following the commencement of, or announcement of an intention to make, a tender
offer or exchange offer the consummation of which would result in the beneficial
ownership by a person or group of affiliated or associated persons of 10% or
more of such outstanding Common Stock.
3. TRANSFER OF RIGHTS AND CERTIFICATES.
The Rights Agreement provides that, until the Distribution
Date, the Rights will be transferred with and only with the Common Stock. Until
the Distribution Date (or earlier
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redemption or expiration of the Rights), new Common Stock certificates issued
after the Record Date upon transfer or new issuance of Common Stock will contain
a notation incorporating the Rights Agreement by reference. Until the
Distribution Date (or earlier redemption or expiration of the Rights), the
surrender for transfer of any certificates for Common Stock outstanding as of
the Record Date, even without such notation or a copy of this Summary of Rights
being attached thereto, will also constitute the transfer of the Rights
associated with the Common Stock represented by such certificate. As soon as
practicable following the Distribution Date, separate certificates evidencing
the Rights (the "Right Certificates") will be mailed to holders of record of the
Common Stock as of the close of business on the Distribution Date, and such
separate Right Certificates alone will evidence the Rights.
4. EXERCISE PERIOD.
The Rights are not exercisable until the Distribution Date.
The Rights will expire on the Final Expiration Date, unless the Final Expiration
Date is extended, or the Rights are earlier redeemed by the Company. The term
"Final Expiration Date" is defined in the Rights Agreement and generally means
May 1, 2008.
5. ADJUSTMENTS.
(a) The Purchase Price payable, and the number of interests in
Preferred Shares or other securities or property 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 or warrants to subscribe for or purchase
Preferred Shares at a price, or securities convertible into Preferred Shares
with a conversion price, 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 paid out of earnings or retained earnings or dividends payable in
Preferred Shares) or of subscription rights or warrants (other than those
referred to above).
(b) The number of outstanding Rights and the number of one
one-hundredth interests in Preferred Shares issuable upon exercise of each Right
are also subject to adjustment in the event of a stock split of the Common Stock
or a stock dividend on the Common Stock payable in Common Stock or subdivisions,
consolidations or combinations of the Common Stock occurring, in any such case,
prior to the Distribution Date.
(c) With certain exceptions, no adjustment in the Purchase
Price will be required until cumulative adjustments require an adjustment of at
least 1% in such Purchase Price. No fractional Preferred Shares will be issued
(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) and in lieu thereof, an adjustment in cash will be made
based on the market price of the Preferred Shares on the last trading day prior
to the date of exercise.
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6. PREFERRED SHARES.
(a) Interests in 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 per share but will be
entitled to an aggregate dividend of 100 times the dividend declared per Common
Stock. In the event of liquidation, the holders of the interests in Preferred
Shares will be entitled to a minimum preferential liquidation payment of $100
per share but will be entitled to an aggregate payment of 100 times the payment
made per Common Stock. Each Preferred Share will have 100 votes, voting together
with the Common Stock. Finally, in the event of any merger, consolidation or
other transaction in which Common Stock is exchanged, each Preferred Share will
be entitled to receive 100 times the amount received per share of Common Stock.
These rights are protected by customary antidilution provisions.
(b) Because of the nature of the Preferred Shares' dividend,
liquidation and voting rights, the value of the one one-hundredth interest in a
Preferred Share purchasable upon exercise of each Right should approximate the
value of one share of Common Stock.
7. EXERCISE OF RIGHTS FOR COMMON STOCK.
In the event that any person becomes an Acquiring Person,
proper provision shall be made so that each holder of a Right, other than Rights
beneficially owned by the Acquiring Person (which will thereafter be void), will
thereafter have the right to receive upon exercise that number of shares of
Common Stock having a market value of two times the purchase price of the Right.
In the event that the Company is acquired in a merger or other business
combination transaction or 50% or more of its consolidated assets or earning
power is sold, proper provision will be made so that each holder of a Right will
thereafter have the right to receive, upon the exercise thereof at the then
current purchase price of the Right, that number of shares of common stock of
the acquiring company that at the time of such transaction will have a market
value of two times the purchase price of the Right.
8. OPTIONAL EXCHANGE OF RIGHTS.
At any time after a person or group of affiliated or
associated persons becomes an Acquiring Person and prior to the acquisition by
such person or group of persons of 50% or more of the outstanding Common Stock,
the Board of Directors of the Company may exchange the Rights (other than Rights
owned by such person or group which have become void), in whole or in part, at
an exchange ratio (subject to adjustment) of one share of Common Stock per
Right. At its option, the Board may substitute interests in Preferred Shares (or
shares of a class or series of the Company's preferred stock having equivalent
rights, preferences and privileges) for Common Stock exchangeable for Rights at
an initial rate (subject to adjustment) of one one-hundredth interest in a
Preferred Share (or equivalent preferred share) for each share of Common Stock.
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9. REDEMPTION OF RIGHTS.
At any time prior to the acquisition by a person or group of
affiliated or associated persons of beneficial ownership of 10% or more of the
outstanding Common Stock, 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").
Immediately upon any redemption of the Rights, the right to
exercise the Rights will terminate, and the only right of the holders of Rights
will be to receive the Redemption Price.
10. AMENDMENTS.
The terms of the Rights may be amended by the Board of
Directors of the Company without the consent of the holders of the Rights,
including an amendment to lower the threshold for exercisability of the rights
to not less than the largest percentage of the outstanding Common Stock then
known to the Company to be beneficially owned by any person or group of
affiliated or associated persons, provided that from and after such time as any
person becomes an Acquiring Person, the terms of the Rights may be amended only
by resolution of the Board adopted by a majority of Continuing Directors (which
resolution is effective only if Continuing Directors constitute a majority of
the number of directors in office).
11. RIGHTS PRIOR TO EXERCISE.
Until a Right is exercised, the holder thereof, as such, will
have no rights as a shareholder of the Company, including, without limitation,
the right to vote or to receive dividends.
12. DOCUMENTS AND EFFECT OF THIS SUMMARY.
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 April 15, 1998. A copy of the Rights Agreement is available free
of charge from the Company. 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.
