FORM OF
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XXXXXXXX FINANCIAL, INC
AND
UMB BANK, N.A.,
RIGHTS AGENT
RIGHTS AGREEMENT
DATED AS OF
OCTOBER [____], 1999
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XXXXXXXX FINANCIAL, INC. RIGHTS AGREEMENT
TABLE OF CONTENTS
Section 1. Certain Definitions............................ ............... 1
Section 2. Appointment of a Rights Agent................... ...............4
Section 3. Certificates and Transfer of Agents.............. ..............4
Section 4. Form of Rights Certificates....................... .............7
Section 5. Countersignature and Registration.................. ............8
Section 6. Transfer, Split Up, Combination and Exchange of Rights
Certificates; Mutilated, Destroyed, Lost or Stolen Rights
Certificates........................................ ...........8
Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights. .9
Section 8. Cancellation and Destruction of Rights Certificates............11
Section 9. Reservation and Availability of Shares of Capital Stock........11
Section 10. Preferred Stock Record Date....................................12
Section 11. Adjustment of Purchase Price, Number and Kind of Shares or
Number of Rights...............................................13
Section 12. Certificate of Adjusted Purchase Price or Number of Shares.....20
Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning
Power..........................................................20
Section 14. Fractional Rights and Fractional Shares........................23
Section 15. Rights of Action...............................................24
Section 16. Agreement of Right Holders.....................................24
Section 17. Rights Certificate Holder Not Deemed a Stockholder.............25
Section 18. Concerning the Rights Agent....................................25
Section 19. Merger or Consolidation or Change of Name of Rights Agent......26
Section 20. Duties of Rights Agent.........................................26
Section 21. Change of Rights Agent.........................................28
Section 22. Issuance of New Rights Certificates............................29
Section 23. Redemption and Termination.....................................29
Section 24. Notice of Certain Events.......................................30
Section 25. Notices........................................................31
Section 26. Supplements and Amendments.....................................32
Section 27. Successors.....................................................32
Section 28. Determination and Actions by the Board of Directors, etc. .....32
Section 29. Benefits of this Agreement.....................................33
Section 30. Severability...................................................33
Section 31. Governing Law..................................................33
Section 32. Counterparts...................................................33
Section 33. Descriptive Headings...........................................34
Exhibit A Form of Certificate of Designation
Exhibit B Form of Rights Certificate
Form of Assignment
Certificate
Notice
Form of Election to Purchase
Certificate
Notice
Exhibit C Summary of Rights to Purchase Preferred Stock
RIGHTS AGREEMENT
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This Agreement, dated as of October [_____], 1999, between XXXXXXXX
FINANCIAL, INC., a Delaware corporation (the "COMPANY"), and UMB Bank, N.A.,
a national banking association organized and existing under the laws of the
United States of America, as rights agent (the "RIGHTS AGENT").
W I T N E S S E T H
WHEREAS, the Board of Directors of the Company has authorized and
declared a dividend of one Right (as defined herein) for each outstanding
share of the common stock (as defined herein), of the Company at the close of
business on [_____________], 1999 (the "RECORD DATE") and has authorized the
issuance of one Right (as such number may hereinafter be adjusted pursuant to
the provisions of SECTION 11 hereof) in respect of each share of Common Stock
of the Company issued (whether originally issued or delivered from the
Company's treasury) between the Record Date and the earlier of the
Distribution Date, the Expiration Date or the Final Expiration Date (as such
terms are hereinafter defined), each Right initially representing the right
to purchase, under certain circumstances, 1/1,000ths of a share of Preferred
Stock (as defined herein), upon the terms and subject to the conditions
hereinafter set forth (the "RIGHTS");
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, and other good and valuable consideration, the
receipt of which is hereby acknowledged, the Company and the Rights Agent
hereby agree as follows.
SECTION 1. CERTAIN DEFINITIONS.
For purposes of this Agreement, the following terms have the meanings
indicated.
(a) "ACQUIRING PERSON" shall mean any Person who, together with all
Affiliates or Associates of such Person, shall be the Beneficial Owner of a
Substantial Block, whether or not such Person continues to be the Beneficial
Owner of a Substantial Block, but shall not include: (i) the Company; (ii)
any Subsidiary of the Company; (iii) any employee benefit plan of the Company
or of any Subsidiary of the Company, or any Person organized, appointed or
established by the Company or by any Subsidiary of the Company for or
pursuant to the terms of any such plan; or (iv) a Person who, together with
all Affiliates and Associates of such Person, would become an Acquiring
Person solely as a result of a reduction of the number of shares of Common
Stock of the Company outstanding, including repurchases of outstanding shares
of Common Stock of the Company by the Company, which reduction increases the
percentage of outstanding shares of Common Stock of the Company beneficially
owned by such Person until such Person, Affiliate or Associate shall
thereafter become the Beneficial Owner of any additional shares of Common
Stock.
(b) "ADJUSTED NUMBER OF SHARES" shall have the meaning given the term
in SECTION 11(a)(iii) of this Agreement.
(c) "ADJUSTED PURCHASE PRICE" shall have the meaning given the term
in SECTION 11(a)(iii) of this Agreement.
(d) "AFFILIATE" and "ASSOCIATE" shall have the respective meanings
ascribed to such terms in Rule 12b-2 of the Exchange Act as in effect on the
date hereof.
(e) A Person shall be deemed the "BENEFICIAL OWNER" of and shall be
deemed to "BENEFICIALLY OWN" any securities that:
(i) Such Person, or any of such Person's Affiliates or
Associates, beneficially owns, directly or indirectly (as determined
pursuant to Rule 13d-3 of the Exchange Act);
(ii) Such Person or any of such Person's Affiliates or
Associates, directly or indirectly, 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 (whether or not in writing), or upon the exercise,
conversion or exchange of rights, warrants or options, or otherwise,
(PROVIDED, HOWEVER, that a Person shall not be deemed the "Beneficial
Owner" of, or to beneficially own, securities tendered pursuant to a
tender or exchange offer made by such Person or any such Person's
Affiliates or Associates until such tendered securities are accepted
for purchase or exchange and securities issuable upon the exercise of
the Rights at any time prior to the occurrence of a Triggering Event);
or (B) the right to vote or dispose of pursuant to any agreement,
arrangement or understanding (whether or not in writing) PROVIDED,
HOWEVER, that a Person shall not be deemed the Beneficial Owner or to
beneficially own, any security under this clause (B) if the agreement,
arrangement or understanding to vote such security (1) arises solely
from a revocable proxy or consent given in response to a public proxy
or consent solicitation made pursuant to, and in accordance with, the
Exchange Act and (2) is not also then reportable on Schedule 13D under
the Exchange Act (or any comparable or successor report); or
(iii) Are beneficially owned, directly or indirectly, by any
other Person with which such former Person or any of such Person's
Affiliates or Associates has any agreement, arrangement or
understanding (whether or not in writing) for the purpose of acquiring,
holding, voting (except pursuant to a revocable proxy as described in
clause (B) of subparagraph (ii) of this paragraph (c)) or disposing of
any securities of the Company;
PROVIDED, however, that nothing in this paragraph (e) shall cause a Person
engaged in business as an underwriter of securities to be the "Beneficial
Owner" of, or to "beneficially own," any securities acquired through such
Person's participation in good faith in a firm commitment underwriting until
the expiration of forty days after the date of such acquisition.
(f) "CAPITAL STOCK EQUIVALENTS" shall have the meaning given the term
in SECTION 11(a)(iii) of this Agreement.
(g) "BUSINESS DAY" shall mean any day other than a Saturday, 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.
(h) "CLOSE OF BUSINESS" on any given date shall mean 5:00 p.m., New
York, New York time, on such date, PROVIDED, HOWEVER, if such date is not a
Business Day it shall mean 5:00 p.m. on the next succeeding Business Day.
(i) "COMMON STOCK" when used with reference to the Company shall mean
the Common Stock, $0.01 par value, of the Company as adjusted from time to
time. "Common Stock" when used with reference to any Person other than the
Company shall mean the capital stock with the greatest voting power of such
Person or the equity securities or other equity interest having power to
control or direct the management of such Person.
(j) "CURRENT MARKET PRICE" of the Common Stock shall have the meaning
given the term in SECTION 11(d)(i) of this Agreement.
(k) "CURRENT MARKET PRICE" of the Preferred Stock shall have the
meaning given the term in SECTION 11(d)(ii) of this Agreement.
(l) "DISTRIBUTION DATE" shall have the meaning given the term in
SECTION 3(a) of this Agreement.
(m) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended, or any successor thereto, and the rules and regulations promulgated
thereunder, all as the same shall be amended from time to time.
(n) "EXPIRATION DATE" shall have the meaning given the term in
SECTION 7(a) of this Agreement.
(o) "FINAL EXPIRATION DATE" shall have the meaning given the term in
SECTION 7(a) of this Agreement.
(p) "PERMITTED OFFER" shall mean a tender offer or exchange offer
that is for all outstanding Common Stock of the Company at a price and on
terms determined to be adequate prior to the purchase of shares under such
tender offer or exchange offer, by at least 70% of the members of the Board
of Directors of the Company, taking into account all factors that such
directors deem relevant including, without limitation, prices that could
reasonably be achieved if the Company or its assets were sold on an orderly
basis designed to realize maximum value and otherwise in the best interests
of the Company and its stockholders (other than the Person or any Affiliate
or Associate thereof for whose benefit the offer is being made).
(q) "PERSON" shall mean any individual, firm, corporation, limited
liability company, partnership, joint venture, association, trust or other
entity.
(r) "PREFERRED STOCK" shall mean the shares of Series A Preferred
Stock, par value $0.001 per share, of the Company having substantially the
rights, powers and preferences set forth in the Certificate of Designation
attached hereto as EXHIBIT A, and, to the extent that there are not a
sufficient number of shares of Series A Preferred Stock authorized to permit
the full exercise of the Rights, any other series of Preferred Stock of the
Company designated for such purpose containing terms substantially similar to
the terms of the Series A Preferred Stock.
(s) "PRINCIPAL PARTY" shall have the meaning given the term in
SECTION 13(b) of this Agreement.
(t) "PRORATION FACTOR" shall have the meaning given the term in
SECTION 11(a)(iii) of this Agreement.
(u) "RIGHTS CERTIFICATES" shall have the meaning given the term in
SECTION 3 of this Agreement.
(v) "SHARE ACQUISITION DATE" shall mean the close of business on the
tenth calendar day after 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.
(w) "SECURITIES ACT" shall mean the Securities Act of 1933, as
amended, or any successor thereto, and the rules, regulations, and forms
promulgated thereunder, all as the same shall be amended from time to time.
(x) A "SUBSIDIARY" of any Person shall mean any Person of whom a
majority of the voting power of the voting equity securities or voting
interests is owned or, directly or indirectly, by such former Person, or any
Person which is otherwise controlled, directly or indirectly, by such former
Person.
(y) "SUBSTANTIAL BLOCK" shall mean a number of shares of the Common
Stock of the Company that equals or exceeds 15 percent of the number of
shares of the Common Stock of the Company then outstanding.
(z) "TRADING DAYS" shall have the meaning given the term in SECTION
11(d)(i) of this Agreement.
(aa) "TRIGGERING EVENT" shall mean any event described in SECTION
11(a)(ii) or SECTION 13(a) of this Agreement.
SECTION 2. APPOINTMENT OF A RIGHTS AGENT.
The Company hereby appoints the Rights Agent to act as agent for the
Company and the holders of the Rights (who, in accordance with SECTION 3,
hereof shall prior to the Distribution Date also be the holders of the Common
Stock of 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.
SECTION 3. CERTIFICATES AND TRANSFER OF RIGHTS.
(a) COMMON STOCK OUTSTANDING ON THE RECORD DATE. Until the earlier
of (unless extended by the Board of Directors of the Company) (i) the Share
Acquisition Date or (ii) the close of business on the tenth calendar day (or
such later date as may be determined by action of the Board of Directors
prior to such time as any Person becomes an Acquiring Person) after the date
of the commencement of, or first public announcement of the intent of any
Person (other than the Company, any Subsidiary of the Company, any employee
benefit plan of the Company or any Person organized, appointed or established
by the Company or any Subsidiary of the Company for or pursuant to the terms
of any such plan) to commence (which intention to commence remains in effect
for five business days after such announcement) a tender or exchange offer
if, upon consummation thereof, such Person would be an Acquiring Person
(including any such date that is after the date of this Agreement and prior
to the issuance of the Rights) (the earlier of the dates in subsections (i)
and (ii) hereof being herein referred to as the "Distribution Date"), the
Rights will be evidenced (subject to the provisions of paragraph (b) of this
SECTION 3) by the certificates for Common Stock of the Company (which
certificates of such Common Stock of the Company shall be deemed also to be
Rights Certificates), and not by separate Rights Certificates, and the right
to receive Rights Certificates will be transferable only in connection with
the transfer of such Common Stock (including a transfer to the Company). With
respect to certificates for the Common Stock of the Company outstanding as of
the Record Date, until the Distribution Date, the Rights will be evidenced by
such certificates for the Common Stock of the Company with or without a
Summary of Rights attached thereto and the registered holders of the Common
Stock of the Company shall also be the registered holders of the associated
Rights. Until the earlier of Distribution Date or Expiration Date, the
surrender or transfer (including a transfer to the Company) of any of the
certificates for the Common Stock of the Company outstanding on the Record
Date shall also constitute the transfer of the Rights associated with the
Common Stock of the Company represented by such certificate. The Company
will include with its mailing, by third-class, postage prepaid mail, of its
quarterly report to Stockholders, if any, a copy of a Summary of Rights, in
substantially the form attached hereto as Exhibit C (the "SUMMARY OF
RIGHTS"). If such mailing has not occurred by the expiration of 60 days
after the expiration of the quarter in which this Agreement becomes
effective, the Company will promptly mail the Summary of Rights separately,
by first-class, postage prepaid mail, to each record holder of the Common
Stock of the Company as of the close of business on the Record Date, at the
address of such holder shown on the records of the Company.
(b) DISTRIBUTION OF SEPARATE RIGHTS CERTIFICATES. As soon as
practicable after the Distribution Date, the Rights Agent will send, by
first-class, insured, postage prepaid mail, to each record holder of the
Common Stock of the Company as of the close of business on the Distribution
Date, at the address of such holder shown on the records of the Company, a
separate Rights Certificate in substantially the form of Exhibit B attached
hereto evidencing one Right for each share of the Common Stock of the Company
so held, subject to adjustment as provided herein. In the event that an
adjustment in the number of Rights per Common Share has been made pursuant to
SECTION 11(p) hereof, at the time of distribution of the Rights Certificate,
the Company shall make the necessary and appropriate rounding adjustments (in
accordance with SECTION 14(a) hereof) so that Rights Certificates
representing only whole numbers of Rights are distributed and cash is paid in
lieu of any fractional Rights. As of and after the Distribution Date, the
Rights will be evidenced solely by such Rights Certificates.
(c) ISSUANCE OF ADDITIONAL SHARES OF COMMON STOCK AND RIGHTS. Rights
shall be issued in respect of all shares of Common Stock of the Company
issued (whether originally issued or delivered from the Company's treasury)
after the Record Date but prior to the earlier of the Distribution Date or
the Expiration Date. Certificates representing such shares of such Common
Stock shall be deemed to be 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
Xxxxxxxx Financial, Inc. and UMB Bank, N.A. dated as of October
[_____], 1999, as 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 Xxxxxxxx Financial, Inc. Under certain
circumstances, as set forth in the Rights Agreement, such Rights
may be redeemed, may expire or may be evidenced by separate
certificates and will no longer be evidenced by this certificate.
Xxxxxxxx Financial, Inc. will mail to the holder of this
certificate a copy of the Rights Agreement, as in effect on the
date of mailing, without charge within five business days after
receipt of a written request therefor. Under certain
circumstances, Rights issued to, or which are or were
beneficially owned by, Acquiring Persons or their Affiliates or
Associates (as such terms are defined in the Rights Agreement)
and any subsequent holder of such Rights may become null and
void.
Until the earlier of the Distribution Date or the Expiration Date, the Rights
associated with the Common Stock of the Company represented by certificates
containing the foregoing legend shall be evidenced by such certificates
alone, and the surrender for transfer of any of such certificates shall also
constitute the transfer of the Rights associated with the Common Stock
represented by such certificate.
(d) PURCHASE OF COMMON STOCK BY THE COMPANY. In the event that the
Company purchases or acquires any of its Common Stock after the Record Date
but prior to the Distribution Date, the Company shall not be entitled to
exercise any Rights associated with the Common Stock so purchased or
acquired. Upon reissuance of such Common Stock by the Company the Rights
shall again attach to such Common Stock as set forth in SECTION 3(c) of this
Agreement.
(e) RESTRICTION ON TRANSFERS TO ACQUIRING PERSONS. Notwithstanding
anything in this Agreement to the contrary, no Right shall at any time be
transferable or transferred, in one transaction or in a series of related
transactions (including a tender offer or exchange offer), directly or
indirectly (i) to any Person who is an Acquiring Person, (ii) to any Person
in connection with a transaction or series of related transactions in which
such Person becomes an Acquiring Person, (iii) to any Person who, as a result
of such transfer, would beneficially own 15 percent or more of the Rights, or
(iv) to any Affiliate or Associate of a Person referred to in any one or more
of the foregoing clauses (i), (ii), or (iii). Any purported or attempted
transfer of a Right on or after the Record Date in violation of the foregoing
provisions (regardless whether such purported or attempted transfer shall be
recorded on any transfer ledger) shall be null and void as of the date of the
purported or attempted transfer without any further action on the part of the
Company or the Rights Agent, and any Right that has been the subject of any
such purported or attempted transfer shall for purposes of this Agreement and
the Right Certificate be deemed to be held beneficially by the Person who
attempted to make such purported or attempted transfer and, thereafter, shall
continue to be exercisable by such Person or, in the case of a transfer not
prohibited by this Agreement, such Person's transferee, for a like number of
1/l,000ths of a Preferred Share (or other securities, cash or other assets,
as the case may be) pursuant to this Agreement. The Company may require (or
cause the Rights Agent or any transfer agent of the Company to require) any
Person who submits a Right Certificate for transfer on the registry books or
to exercise the Rights represented thereby to establish to the satisfaction
of the Company, in its sole discretion, that such attempted transfer is not
in violation of the provisions of this SECTION 3(e). The Company and the
Rights Agent shall use all reasonable efforts to insure the provisions of
this SECTION 3(e) are complied with, but shall have no liability to any
holder of a Right Certificate (other than as specifically provided herein) or
any other Person as a result of a failure to so insure.
SECTION 4. FORM OF RIGHTS CERTIFICATES.
(a) FORM OF CERTIFICATE. The Rights Certificates (and the forms of
election to purchase shares and of assignment to be printed on the reverse
thereof) shall, subject to paragraph (a) of SECTION 3 of this Agreement, be
substantially the same as EXHIBIT B hereto and may have such marks of
identification or designation and such legends, summaries or endorsements
printed thereon as the Company may deem appropriate and as are not
inconsistent with the provisions of this Agreement, or as may be required to
comply with any applicable law or with any rule or regulation 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 usages. Subject to
the provisions of SECTION 11 and SECTION 22 hereof, the Rights Certificates,
whenever issued, shall be dated as of the Record Date, and on their face
shall entitle the holders thereof to purchase such number of 1/l,000ths of a
share of Preferred Stock as shall be set forth therein at the price per
1/1,000ths of a share of Preferred Stock set forth therein (the "PURCHASE
PRICE"), but the number of such shares and the Purchase Price shall be
subject to adjustment as provided herein.
(b) Notwithstanding any other provision of this Agreement, any Rights
Certificate issued pursuant to SECTION 3 or SECTION 22 hereof that represent
Rights beneficially owned by (i) an Acquiring Person or any Associate or
Affiliate thereof, (ii) a transferee of an Acquiring Person (or of any
Associate or Affiliate of such Acquiring Person) who becomes a transferee
after the Acquiring Person became such, or (iii) a transferee of an Acquiring
Person (or of any such Associate or Affiliate of such Acquiring Person) who
becomes a transferee prior to or concurrently with the Acquiring Person
becoming such and receives such Rights pursuant to either (A) a transfer
(whether or not for consideration) from the Acquiring Person to holders of
equity interests in such Acquiring Person or to any Person with whom such
Acquiring Person has any continuing agreement, arrangement or understanding
(whether or not in writing) regarding the transferred Rights or (B) a
transfer which the Board of Directors of the Company has determined is part
of a plan, arrangement or understanding that has a primary purpose or effect
avoidance of SECTION 7(e) hereof, any Rights Certificate issued at any time
to any nominee of such Acquiring Person, Associate or Affiliate, and any
Rights Certificate issued pursuant to SECTION 6 or SECTION 11 upon transfer,
exchange, replacement or adjustment of any other Rights Certificate referred
to in this sentence, shall contain the following legend:
The Rights represented by this Rights Certificate are or were
beneficially owned by a Person who was or became an Acquiring
Person or an Affiliate or an Associate of an Acquiring Person (as
such terms are defined in the Rights Agreement). Accordingly,
this Rights Certificate and the Rights represented hereby may
become null and void in the circumstances specified in SECTION
7(e) of the Rights Agreement.
The provisions of SECTION 7(e) of the Rights Agreement shall be operative
whether or not the foregoing legend is contained on any Rights Certificate.
SECTION 5. COUNTERSIGNATURE AND REGISTRATION.
(a) The Rights Certificates shall be executed on behalf of the
Company in the manner provided in the By-Laws of the Company for certificates
for Common Stock of the Company. The Rights Certificates shall be
countersigned by the Rights Agent, either manually or by facsimile, and shall
not be valid for any purpose unless so countersigned. In case any officer of
the Company who shall have signed any of the Rights Certificates shall cease
to be such officer of the Company before countersignature by the Rights Agent
and issuance and delivery by the Company, such Rights Certificates,
nevertheless, may be countersigned by the Rights Agent, issued and delivered
with the same force and effect as though the person who signed such Rights
Certificate had not ceased to be such officer of the Company; and any Rights
Certificate may be signed on behalf of the Company by any person who, at the
actual date of the execution of such Rights Certificate, shall be a proper
officer of the Company to sign such Rights 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 principal office or offices designated as the
appropriate place for surrender of the Rights Certificates upon exercise or
transfer, books for registration and transfer of the Rights Certificates
issued hereunder. Such books shall show the names and addresses of the
respective holders of the Rights Certificates, the number of Rights evidenced
on its face by each of the Rights Certificates and the date of each of the
Rights Certificates, and such other information as the Rights Agent deems
appropriate in the circumstances.
SECTION 6. TRANSFER, SPLIT UP, COMBINATION AND EXCHANGE OF RIGHTS
CERTIFICATES; MUTILATED, DESTROYED, LOST OR STOLEN RIGHTS CERTIFICATES.
Subject to the provisions of SECTION 4(b), SECTION 7(e) and 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 Expiration Date, any Rights
Certificates may be transferred, split up or combined with or exchanged for
any other Rights Certificates, entitling the registered holder to purchase a
like number of 1/1,000ths of a share of Preferred Stock (or following a
Triggering Event, Common Stock, other securities or other assets, as may be
necessary) as the Rights Certificate or Rights Certificates surrendered then
entitled such holder (or former holder in the case of a transfer) to
purchase. Any registered holder desiring to transfer, split up, combine or
exchange any Rights Certificate shall make such request in writing delivered
to the Rights Agent, and shall surrender the Rights Certificate or Rights
Certificates to be transferred, split up, combined or exchanged at the
principal office or offices of the Rights Agent designated for such purpose
of the Rights Agent. Neither the Rights Agent nor the Company shall be
obligated to take any action whatsoever with respect to the transfer of any
such surrendered Rights Certificate until the registered holder shall have
completed and signed the certificate contained in the form of assignment on
the reverse side of such Rights Certificate and shall have provided such
additional evidence of the identity of the Beneficial Owner (or former
Beneficial Owner) or Affiliates or Associates thereof as the Company shall
reasonably request. Thereupon the Rights Agent shall, subject to SECTION
4(b), SECTION 7(e) and SECTION 14 hereof, countersign and deliver to the
Person entitled thereto a Rights Certificate or Rights Certificates, as the
case may be, as so requested. The Company may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer, split up, combination or exchange of Rights
Certificates.
Upon receipt by the Company and the Rights Agent of evidence reasonably
satisfactory to them of the loss, theft, destruction or mutilation of a
Rights Certificate, and in case of loss, theft or destruction, of indemnity
or security reasonably satisfactory to them, and reimbursement to the Company
and the Rights Agent of all reasonable expenses incidental thereto, and upon
surrender to the Rights Agent and cancellation of the Rights Certificate if
mutilated, the Company will make and deliver a new Rights Certificate of like
tenor to the Rights Agent for delivery to the registered owner in lieu of the
Rights Certificates so lost, stolen, destroyed or mutilated.
SECTION 7. EXERCISE OF RIGHTS; PURCHASE PRICE; EXPIRATION DATE OF RIGHTS.
(a) Subject to SECTION 7(e) hereof, the registered holder of any
Rights Certificate may exercise the Rights evidenced thereby (except as
otherwise provided herein including, without limitation, the restrictions on
exercisability set forth in SECTION 9(c), SECTION 11(a)(iii) and SECTION
23(a) hereof) in whole or in part at any time after the Distribution Date
upon surrender of the Rights Certificate, with the form of election to
purchase on the reverse side thereof duly completed and executed, to the
Rights Agent at the principal office of the Rights Agent or offices
designated by the Rights Agent for such purposes, together with payment of
the aggregate Purchase Price for the total number of 1/1,000ths of a share of
Preferred Stock (or other securities or assets, as may be necessary and
authorized) as to which such surrendered Rights are exercised, at or prior to
the close of business on the earlier of: (i) [____________] (the "FINAL
EXPIRATION DATE"); (ii) the date on which the Rights are redeemed as provided
in SECTION 23; or (iii) the consummation of a transaction contemplated by
SECTION 13(d) hereof (such earlier date being herein referred to as the
"EXPIRATION DATE").
(b) The Purchase Price for each 1/1,000ths of a share of Preferred
Stock pursuant to the exercise of a Right shall initially be $[_________],
shall be subject to adjustment from time to time as provided in SECTION 11
and SECTION 13 hereof and shall be payable in accordance with paragraph (c)
below.
(c) Upon receipt of a Rights Certificate representing exercisable
Rights with the form of election to purchase and the Certificate duly
completed and executed, payment of the Purchase Price for the number of
1/1,000ths of a share of Preferred Stock (or other securities or other
assets, as the case may be) to be purchased and an amount equal to any
applicable transfer tax, the Rights Agent shall thereupon, subject to SECTION
20(k), promptly:
(i) (A) requisition from any transfer agent of the Preferred
Stock (or make available, if the Rights Agent is the transfer agent for
such Preferred Stock) a certificate for the total number of 1/1,000ths
of a share of the Preferred Stock to be purchased, and the Company
hereby irrevocably authorizes its transfer agent to comply with all
such requests, or (B) if the Company shall have elected to deposit the
total number of shares of Preferred Stock issuable upon exercise of the
Rights hereunder with a depositary agent, requisition from the
depositary agent a depositary receipt representing such number of
1/1,000ths of a share of Preferred Stock as are to be purchased (in
which case certificates for the shares of Preferred Stock represented
by such receipts shall be deposited by the transfer agent with the
depositary agent), and the Company hereby irrevocably authorizes such
depositary agent to comply with such request;
(ii) when appropriate, requisition from the Company the amount
of cash, if any, to be paid in lieu of issuance of fractional shares in
accordance with SECTION 14;
(iii) promptly after receipt of such certificate or depositary
receipt, cause the same to be delivered to or upon the order of the
registered holder of such Rights Certificates, registered in such name
or names as may be designated by such holder; and
(iv) when appropriate, after receipt promptly deliver such cash,
if any, to or upon the order of the registered holder of such Rights
Certificate.
The payment of the Purchase Price may be made: (i) in cash or by certified
bank check or bank draft payable to the order of the Company, (ii) by
delivery of a certificate or certificates (with appropriate stock powers
executed in blank attached thereto) evidencing a number of shares of Common
Stock equal to the then Purchase Price divided by the current market price
(as determined pursuant to SECTION 11(d) hereof) per share of Common Stock on
the Trading Date immediately preceding the date of such exercise, or (iii) by
a combination of (i) and (ii). In the event that the Company is obligated to
issue securities, distribute property or pay cash pursuant to SECTION
11(a)(iii) hereof, the Company will make all arrangements necessary so that
cash, property or securities are available for issuance, distribution or
payment by the Rights Agent, if and when appropriate.
(d) In case the registered holder of any Rights Certificate shall
exercise less than all the Rights evidenced thereby, a new Rights Certificate
evidencing Rights equivalent to the Rights remaining unexercised shall be
issued by the Rights Agent to the registered holder of such Rights
Certificate or to his duly authorized assigns, subject to the provisions of
SECTION 14 hereof.
(e) Notwithstanding anything in this Agreement to the contrary, if
there occurs the event set forth in SECTION 11(a)(ii), then any Rights that
are or were beneficially owned by: (i) an Acquiring Person or any Associate
or Affiliate of such Acquiring Person; (ii) any subsequent holder of such
Rights; (iii) a transferee of an Acquiring Person or of any Associate or
Affiliate thereof who becomes a transferee prior to or concurrently with the
Acquiring Person becoming such and receives such Rights pursuant to either
(A) a transfer (whether or not for consideration) from the Acquiring Person
to holders of equity interests in such Acquiring Person or to any Person with
whom the Acquiring Person has any continuing agreement, arrangement or
understanding regarding the transferred Rights or (B) a transfer which a
majority of the Board has determined is part of a plan, arrangement or
understanding which has as a primary purpose or effect the avoidance of this
SECTION 7(e) shall become or be (as the case may be) null and void with
respect to the rights provided under SECTION 11(a)(ii) without any further
action, and shall thereafter not provide any such holder with any rights
whatsoever under this Agreement or otherwise. The Company shall use all
reasonable efforts to insure that the provisions of this SECTION 7(e) and
SECTION 4(b) hereof are complied with, but shall have no liability to any
holder of Rights Certificates or other Person as a result of its failure to
make any determinations with respect to an Acquiring Person or its
Affiliates, Associates or transferees thereof.
(f) Notwithstanding anything in this Agreement to the contrary,
neither the Rights Agent nor the Company shall be obligated to undertake any
action with respect to a registered holder upon the occurrence of any
purported exercise as set forth in this SECTION 7 unless such registered
holder shall have: (i) completed and signed the certificate contained in the
form of election to purchase set forth on the reverse side of the Rights
Certificate surrendered for such exercise; and (ii) provided such additional
evidence of the identity of the Beneficial Owner (or former Beneficial Owner)
or Affiliates or Associates thereof as the Company or the Rights Agent shall
reasonably request.
SECTION 8. CANCELLATION AND DESTRUCTION OF RIGHTS CERTIFICATES.
All Rights Certificates surrendered for the purpose of exercise,
transfer, split up, combination or exchange, if surrendered to the Company or
to any of its agents, shall be delivered to the Rights Agent for cancellation
or in canceled form, or if surrendered to the Rights Agent, then shall be
canceled by it, and no Rights Certificates shall be issued in lieu thereof
except as expressly permitted by any of the provisions of this Rights
Agreement. The Company shall deliver to the Rights Agent for cancellation
and retirement, and the Rights Agent shall so cancel and retire, any other
Rights Certificate purchased or acquired by the Company otherwise than upon
the exercise thereof. The Rights Agent shall deliver all canceled Rights
Certificates to the Company, or, at the written request of the Company,
destroy such canceled Rights Certificates, and in such latter case shall
deliver a certificate of destruction thereof to the Company.
SECTION 9. RESERVATION AND AVAILABILITY OF SHARES OF CAPITAL STOCK.
The Company covenants and agrees that it will:
(a) Cause to be reserved and kept available out of its authorized and
unissued shares of Preferred Stock (and following the occurrence of a
Triggering Event, out of its authorized and unissued shares of Common Stock
or its authorized and issued Common Stock held in its treasury, other
securities as provided herein or some combination thereof) the number of
shares of Preferred Stock or other securities as provided herein or some
combination of such securities that will be sufficient to permit the exercise
in full of all outstanding Rights whenever issued.
(b) If the shares of Preferred Stock (and following the occurrence of
a Triggering Event, Common Stock and/or other securities) issuable upon the
exercise of Rights are listed on any national securities exchange, use its
best efforts to cause, from and after such time as the Rights become
exercisable, all shares reserved for such issuance to be listed on such
exchange upon official notice of issuance upon such exercise.
(c) Use its best efforts to: (i) file, as soon as practicable
following the first occurrence of the Distribution Date, a registration
statement under the Securities Act with respect to the securities purchasable
upon exercise of the Rights on an appropriate form; (ii) cause such
registration statement to become effective as soon as practicable after such
filing; (iii) cause such registration statement to remain effective (with a
prospectus at all times meeting the requirements of the Securities Act) until
the date of the expiration of the Rights; (iv) to otherwise comply with all
requirements of the Securities Act and the Exchange Act applicable to the
exercise of the Rights and issuance of the securities upon such exercise; and
(v) take promptly such action as may be appropriate under the blue sky or
securities laws of the States such laws of which would be applicable to the
Rights and the exercise thereof in order for the securities issuable upon
exercise of the Rights to be offered, sold and delivered in accordance with
such laws. Notwithstanding any provision of this Agreement to the contrary,
the Rights shall not be exercisable in any jurisdiction unless the requisite
qualifications in such jurisdiction shall have been obtained.
(d) Take all such action as may be necessary to ensure that all
1/1,000ths shares of the Preferred Stock (and following the occurrence of a
Triggering Event, the other securities as permitted herein) delivered upon
exercise of Rights shall, at the time of delivery of the certificates for
such shares (subject to payment of the Purchase Price), be duly and validly
authorized and issued and fully paid and non-assessable.
(e) 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 Rights Certificates or of any certificates for a number of 1/1,000ths
shares of the Preferred Stock (or other securities, as the case may be) upon
the exercise of Rights all costs and expenses incurred in connection with the
obligations set forth in this SECTION 9. The Company shall not, however, be
required: (i) to pay any transfer tax that may be payable in respect of any
transfer involved in the transfer or delivery of Rights Certificates or the
issuance or delivery of a number of certificates for whole or fractional
shares of a Preferred Stock (or other securities, as the case may be) in a
name other than that of the registered holder of the Rights Certificate
evidencing Rights surrendered for exercise; or (ii) to issue or deliver any
certificates for whole or fractional shares of the Preferred Stock upon the
exercise of any Rights until any such tax shall have been paid (any such tax
being payable by the holder of such Rights Certificate at the time of
surrender) or until it has been established to the Company's satisfaction
that no such tax is due.
SECTION 10. PREFERRED STOCK RECORD DATE.
Each person in whose name any certificate for any whole or fractional
shares of Preferred Stock (or other securities, as the case may be) is issued
upon the exercise of Rights shall for all purposes be deemed to have become
the holder of record of such shares of Preferred Stock (or other securities,
as the case may be) represented thereby, and such certificate shall be dated,
the date upon which the Rights 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 Stock (or other securities, as the
case may be) transfer books of the Company are closed, such person shall be
deemed to have become the record holder of such shares on, and such
certificates shall be dated, the next succeeding business day on which such
transfer books for such securities are open. Prior to the exercise of the
Rights evidenced thereby, the holder of a Rights Certificate shall not be
entitled to any rights as a stockholder of the Company with respect to shares
for which the Rights may be exercisable, including, without limitation, the
right to vote, to receive dividends or other distributions or to exercise any
preemptive rights, and shall not be entitled to receive any notice of any
proceedings of the Company except as provided herein.
SECTION 11. ADJUSTMENT OF PURCHASE PRICE, NUMBER AND KIND OF SHARES OR NUMBER
OF RIGHTS.
The Purchase Price, the number and kind of shares covered by each Right
and the number of Rights outstanding are subject to adjustment from time to
time as provided in this SECTION 11.
(a) In the event that:
(i) CHANGES IN THE PREFERRED STOCK. The Company shall at any
time after the date of this Agreement (A) declare a dividend on the
Preferred Stock payable in shares of the Preferred Stock, (B) subdivide
the outstanding Preferred Stock, (C) combine the outstanding Preferred
Stock into a smaller number of shares or (D) issue any shares of its
capital stock in a reclassification of the Preferred Stock (including
any such reclassification in connection with a consolidation or merger
in which the Company is the continuing or surviving corporation),
except as otherwise provided in this SECTION 11(a) and SECTION 7(e)
hereof, then 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
Preferred Stock (or other securities, as the case may be), issuable on
such date, shall be proportionately adjusted so that the holder of any
Right exercised after such time shall be entitled to receive, upon the
payment of the Purchase Price then in effect, the aggregate number
(whether whole or fractional) and kind of securities that if such Right
had been exercised immediately prior to such date and at a time when
the Preferred Stock 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.
If an event occurs that would require an adjustment under both this SECTION
11(a)(i) and SECTION 11(a)(ii) hereof, the adjustment provided for in this
SECTION 11 (a)(i) shall be in addition to, and shall be made prior to any
adjustment required pursuant to SECTION 11(a)(ii).
(ii) DETERMINATION OF SHARES OF PREFERRED STOCK. Any Person
(other than the Company, any Subsidiary of the Company, any employee
benefit plan of the Company or any of its subsidiaries or any Person
holding securities of the Company organized, appointed or established
by the Company or any of its subsidiaries for or pursuant to the terms
of any such plan), alone or together with its Affiliates and
Associates, shall become an Acquiring Person (except pursuant to a
Permitted Offer), then proper provisions shall be made so that each
holder of a Right, except as provided in SECTION 7(e) hereof, shall,
for a period of 60 days after the effective date of an appropriate
registration statement filed pursuant to SECTION 9 hereof, have a right
to receive, upon exercise thereof at the then current Purchase Price in
accordance with the terms of this Agreement, such number of whole or
fractional shares of Preferred Stock (or if the Board determines prior
to the Distribution Date, such number of shares of Common Stock of the
Company in lieu of the Preferred Stock) as shall equal the result
obtained by multiplying the then current Purchase Price by the then
number of 1/1,000ths of a share of Preferred Stock (or such Common
Stock) for which a Right is exercisable immediately prior to the
occurrence of such SECTION 11(a)(ii) event then dividing that product
(which, following such first occurrence, shall thereafter be referred
to as the Purchase Price for each Right and for all other purposes of
this Agreement) by 50 percent of the current market price per one share
of Preferred Stock (or Common Stock of the Company, as the case may be)
(determined pursuant to SECTION 11(d)) on the date of the first
occurrence of the event set forth in this SUBPARAGRAPH (ii) (such
number of shares being referred to as the "ADJUSTMENT SHARES").
(iii) INSUFFICIENT PREFERRED STOCK. There shall not be
sufficient treasury shares or authorized but unissued and unreserved
Preferred Stock (or Common Stock of the Company as provided for in
SECTION 11(a)(ii) hereof) to permit the exercise in full of all the
outstanding Rights in accordance with the foregoing subparagraph (ii)
and the Rights become so exercisable, notwithstanding any other
provision of this Agreement, to the extent necessary and permitted by
applicable law, each Right shall thereafter represent the right to
receive, upon exercise thereof at the then current Purchase Price in
accordance with the terms of this Agreement: (A) shares (whether whole
or fractional) of Common Stock of the Company that may permissibly be
issued; (B) a number (whether whole or fractional) of other equity
securities of the Company (or in the discretion of the Board of
Directors of the Company, debt) including, but not limited to, whole or
fractional shares of preferred stock of the Company other than the
Preferred Stock (such alternative securities of the Company being
referred to as "CAPITAL STOCK EQUIVALENTS"); or (C) some combination of
(A), (B) and the Preferred Stock, that, in the case of (A), (B) or (C),
the Board of Directors of the Company has determined to have the same
aggregate current market value as determined based upon advice of a
nationally recognized investment banking firm selected by a majority of
the Board and/or pursuant to SECTION 11(d)(i) AND (ii) hereof, to the
extent applicable as the aggregate value of the Preferred Stock if
there were available for issuance sufficient shares of Preferred Stock;
PROVIDED, HOWEVER, if there are unavailable sufficient Preferred Stock
or Capital Stock Equivalents, then the Company shall, to the extent
permitted by applicable law, promptly take all such action as may be
necessary to authorize additional Preferred Stock or Capital Stock
Equivalents for issuance upon exercise of the Rights, including the
calling of a meeting of stockholders; and PROVIDED, FURTHER, that if
the Company is unable to cause sufficient Preferred Stock or Capital
Stock Equivalents to be available for issuance upon exercise in full of
all of the outstanding Rights, then each Right shall thereafter
represent the right to receive the Adjusted Number of Shares upon
exercise of the Adjusted Purchase Price (as such terms are hereinafter
defined). As used herein, the term "ADJUSTED NUMBER OF SHARES" shall
be equal to that number of whole or fractional shares of Preferred
Stock (or Capital Stock Equivalents) equal to the product of (A) the
number of Adjustment Shares and (B) a fraction, the numerator of which
is the number of Shares of Preferred Stock (or Capital Stock
Equivalents) available for issuance upon exercise of the Rights and the
denominator of which is the aggregate number of Adjustment Shares
otherwise issuable upon exercise in full of all Rights (assuming there
were a sufficient number of shares of Preferred Stock (or Capital Stock
Equivalents as the case may be) available) (such fraction being
referred to as the "PRORATION FACTOR"). The "ADJUSTED PURCHASE PRICE"
shall mean the product of the Purchase Price and the Proration Factor.
The Board of Directors may, but shall not be required to, establish
procedures to allocate the right to receive Shares of Preferred Stock
and other Capital Stock Equivalents upon exercise of the Rights among
holders of Rights.
(b) PREFERRED STOCK RIGHTS OR WARRANTS. In case the Company shall
fix a record date for the issuance of rights or warrants to all holders of
Preferred Stock entitling them (for a period expiring within 45 calendar days
after such record date) to subscribe for or purchase Preferred Stock (or
Securities convertible into the Preferred Stock or similar preferred stock)
at a price per share of Preferred Stock (or having a conversion price per
share of Preferred Stock, if a security convertible into Preferred Stock)
less than the current market price per share of Preferred Stock (as defined
in SECTION 11(d) hereof) on such record date, then 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 shares of Preferred Stock
(whether whole or fractional) outstanding on such record date plus the number
of shares of Preferred Stock that the aggregate offering price of the total
number of shares of Preferred Stock and/or similar preferred stock 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 shares of Preferred Stock
(whether whole or fractional) outstanding on such record date plus the number
of additional shares of Preferred Stock (whether whole or fractional) and/or
similar preferred stock to be offered for subscription or purchase (or into
which the convertible securities so to be offered are initially convertible).
In case such subscription price may be paid in part or all in a form other
than cash, then the value of such consideration shall be as determined in
good faith by the Board of Directors of the Company, whose determination
shall be described in a statement filed with the Rights Agent and shall be
binding on the Rights Agent and the Holders of the Rights. Shares of
Preferred Stock (whether whole or fractional) owned by or held for the
account of the Company shall not be deemed outstanding for the purpose of any
such computation. Such adjustment shall be made successively whenever such a
record date is fixed, and in the event that such rights 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 has not been fixed.
(c) DISTRIBUTIONS ON THE PREFERRED STOCK. In case the Company shall
fix a record date for the making of a distribution to all holders of
Preferred Stock (including any such distribution made in connection with a
consolidation or merger in which the Company is the continuing corporation)
of evidences of indebtedness, assets (other than a regular periodic cash
dividend at a rate not in excess of 125 percent of the rate of the last cash
dividend theretofore paid out of the earnings or retained earnings of the
Company or a dividend payable in Preferred Stock (but including any dividend
payable in stock other than Preferred Stock)), securities or subscription
rights or warrants (excluding those referred to in SECTION 11(b) hereof),
then 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 current
market price per share of Preferred Stock (as defined in SECTION 11(d)
hereof) on such record date, less the fair market value (as determined in
good faith by the Board of Directors of the Company, whose determination
shall be described in a statement filed with the Rights Agent and shall be
binding on the Rights Agent and the Holders of the Rights) of the portion of
the assets, evidences of indebtedness, securities, subscription rights or
warrants so to be distributed and applicable to one share of Preferred Stock
and the denominator of which shall be such current market price per share of
Preferred Stock (as determined pursuant to SECTION 11(d) hereof). 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) DETERMINATION OF CURRENT MARKET PRICE. For the purpose of any
computation hereunder:
(i) The "CURRENT MARKET PRICE" per share of Common Stock on any
date shall be deemed to be for purposes other than SECTION 11(a)(iii)
hereof the average of the daily closing prices per share of such Common
Stock for the 30 consecutive Trading Days (as such term is hereinafter
defined) immediately prior to such date and for purposes of SECTION
11(a)(iii) hereof, the average of the daily closing prices per share of
such Common Stock for the 10 consecutive Trading Days immediately prior
to that date; PROVIDED, HOWEVER, that in the event that the current
market price per share of Common Stock is determined during the period
following the announcement by the issuer of such Common Stock of (A) a
dividend or distribution on such Common Stock payable in shares of such
Common Stock or securities convertible into shares of such Common Stock
(other than the Rights), or (B) any subdivision, combination or
reclassification of such Common Stock, and the ex-dividend date for
such dividend or distribution, or the record date for such subdivision,
combination or reclassification, shall not have occurred prior to the
commencement of the requisite 30 or 10 Trading Day period, then, and in
each such case, the current market price shall be appropriately
adjusted to reflect the current market price per Common Stock
equivalent. 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
principal national securities exchange on which the shares of the
Common Stock are listed or admitted to trading or, if the shares of the
Common Stock are not listed or admitted to trading on any national
securities exchange, the last sale price or, if not so reported, the
average of the high bid and low asked prices in the over-the-counter
market, as reported by the National Association of Securities Dealers,
Inc. Automated Quotation System (the "NASDAQ SYSTEM") or such other
system then in use, or, if on any such date the shares of the Common
Stock are not quoted by such organization, the average of the closing
bid and asked prices as furnished by a professional market maker making
a market in the Common Stock selected by the Board of Directors of the
Company. If on any such date no market maker is making a market in the
Common Stock, the fair value of such Common Stock on such date shall be
as determined in good faith by a majority of the Board (or, if at the
time of such determination there is an Acquiring Person, by a
nationally recognized investment banking firm selected by such
majority). The term "TRADING DAY" shall mean a day on which the
principal national securities exchange on which the shares of Common
Stock are listed or admitted for trading is open for the transaction of
business or, if the shares of the Common Stock are not listed or
admitted for trading on any national securities exchange, a Business
Day on which securities were traded in the over-the-counter market. If
the Common Stock is not publicly held or not so listed or traded,
"CURRENT MARKET PRICE" per share shall mean the fair value per share as
determined in good faith by the Board of Directors, or, if at the time
of such determination there is an Acquiring Person, by a nationally
recognized investment banking firm, which determination shall be
described in a statement filed with the Rights Agent and shall be
conclusive for all purposes.
(ii) The "CURRENT MARKET PRICE" per share of Preferred Stock
shall be determined in the same manner as set forth above for the
Common Stock in clause (i) of this SECTION 11(d) (other than the last
sentence thereof). If the current market price per share of Preferred
Stock cannot be determined in the manner provided above or if the
Preferred Stock is not publicly held or listed or traded in a manner
described in clause (i) of this SECTION 11(d), the "CURRENT MARKET
PRICE" per share of Preferred Stock shall be conclusively deemed to be
an amount equal to 1,000 (as such number may be appropriately adjusted
for such events as stock splits, stock dividends and recapitalization
with respect to the Common Stock occurring after the date of this
Agreement) multiplied by the current market price per share of the
Common Stock. If neither the Common Stock nor the Preferred Stock is
publicly held or so listed or traded, "CURRENT MARKET PRICE" per share
of the Preferred Stock shall be determined in the same manner as set
forth in the last sentence of SECTION 11(d)(i). For all purposes of
this Agreement, the "CURRENT MARKET PRICE" of 1/1,000ths of a share of
Preferred Stock shall be equal to the "CURRENT MARKET PRICE" of one
share of Preferred Stock divided by 1,000.
(e) LIMITATION ON ADJUSTMENT ON PURCHASE PRICE. Notwithstanding
anything herein to the contrary, no adjustment in the Purchase Price shall be
required unless such adjustment would require an increase or decrease of at
least 1 percent in such 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 ten-thousandth of a share as the case may be. Notwithstanding the
first sentence of this SECTION 11(e), any adjustment required by this SECTION
11 shall be made no later than the earlier of (i) three years from the date
of the transaction which mandates such adjustment or (ii) the Expiration
Date.
(f) If, as a result of an adjustment made pursuant to SECTION 11(a),
the holder of any Right thereafter exercised shall become entitled to receive
any Capital Stock Equivalents or other shares of capital stock of the Company
other than shares of Preferred Stock, thereafter the number of such other
shares so receivable upon exercise of any Right and the payment Purchase
Price thereof 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 Stock contained in SECTION 11(a) THROUGH (o),
inclusive, and the provisions of SECTIONS 7, 9, 10, 13 AND 14 with respect to
the Preferred Stock shall apply on like terms to any such other shares.
(g) All Rights originally issued by the Company subsequent to any
adjustment made to the Purchase Price hereunder shall evidence the right to
purchase, at the adjusted Purchase Price, the number of 1/1,000ths of a share
of Preferred Stock 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 1/1,000ths of a share of Preferred Stock (calculated to the
nearest ten-thousandth) obtained by (i) multiplying (x) the number of
1/1,000ths of a share covered by a Right immediately prior to this adjustment
by (y) the Purchase Price in effect immediately prior to such adjustment of
the Purchase Price and (ii) dividing the product so obtained by the Purchase
Price in effect immediately after such adjustment of the Purchase Price.
(i) The Company may elect on or after the date of any adjustment of
the Purchase Price to adjust the number of Rights in lieu of any adjustment
in the number of 1/1,000ths of a share of Preferred Stock 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
1/1,000ths of a share of Preferred Stock 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 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 the adjustment of the Purchase
Price. The Company shall make a public announcement of its election to
adjust the number of Rights, indicating the record date for the adjustment
and, if known at the time, the amount of the adjustment to be made. This
record date may be the date on which the Purchase Price is adjusted or any
date thereafter, but, if the Rights Certificates have been issued, shall be
at least 10 Business Days later than the date of the public announcement. If
Rights 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 Rights
Certificates on such record date Rights Certificates evidencing, subject to
SECTION 14, the additional Rights to which such holders shall be entitled as
a result of such adjustment, or, at the option of the Company, shall cause to
be distributed to such holders of record in substitution and replacement for
the Rights Certificates held by such holders prior to the date of adjustment,
and upon surrender thereof, if required by the Company, new Rights
Certificates evidencing all the Rights to which such holders shall be
entitled after such adjustment. Rights Certificates so to be distributed
shall be issued, executed and countersigned in the manner provided for herein
(and may bear, at the option of the Company, the adjusted Purchase Price) and
shall be registered in the names of the holders of record of Rights
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 1/1,000ths of a share of Preferred Stock issuable upon the
exercise of the Rights, the Rights Certificates theretofore and thereafter
issued may continue to express the Purchase Price per 1/1,000ths of a share
and the number of 1/l,000ths of a share that were expressed in the initial
Rights Certificates issued hereunder and if so, shall not affect in any way
the adjustments or changes required under this Agreement.
(k) Before taking any action that would cause an adjustment reducing
the Purchase Price below the then stated value, if any, of the number of
1/1,000ths of a share of Preferred Stock issuable upon exercise of the
Rights, the Company shall take any corporate action that may, in the opinion
of its counsel, be necessary in order that the Company may validly and
legally issue fully paid and non-assessable such number of 1/1,000ths of a
share of such Preferred Stock 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 issuance to the holder of any Right exercised after such record
date the number of 1/1,000ths of a share of Preferred Stock and Capital Stock
Equivalents, if any, issuable upon such exercise over and above the number of
1/1,000ths of a share of Preferred Stock 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
(fractional or otherwise) or other securities upon the occurrence of the
event requiring such adjustment.
(m) Notwithstanding anything in this SECTION 11 to the contrary, the
Company shall be entitled to make such reductions in the Purchase Price, in
addition to those adjustments expressly required by this SECTION 11, as and
to the extent that in their good faith judgment the Board of Directors of the
Company shall determine to be advisable in order that any (i) consolidation
or subdivision of Preferred Stock, (ii) issuance wholly for cash of any
shares of Preferred Stock at less than the current market price, (iii)
issuance wholly for cash of shares of Preferred Stock or securities which by
their terms are convertible into or exchangeable for shares of Preferred
Stock, (iv) stock dividends, or (v) issuance of rights, options or warrants
referred to hereinabove in this SECTION 11, hereafter made by the Company to
holders of its Preferred Stock shall not be taxable to such stockholders.
(n) The Company covenants and agrees that, after the Distribution
Date, it will not, except as permitted by SECTION 23 or SECTION 26 hereof,
take (nor will it permit any of its subsidiaries to take) any action if at
the time such action is taken it is reasonably foreseeable that such action
will diminish substantially or otherwise eliminate the benefits intended to
be afforded by the Rights.
(o) The Company covenants and agrees that it shall not, at any time
after the Distribution Date (other than in a transaction or series of
transactions that comply with SECTION 11(n) hereof): (i) consolidate with;
(ii) merge with or into; or (iii) sell or transfer (or permit any of its
subsidiaries to sell or transfer), in one or more transactions, assets or
earning power aggregating more than 50 percent of the assets or earning power
of the Company and its subsidiaries (taken as a whole) to any other Person if
at the time of or immediately after such consolidation, merger or sale there
are any rights, warrants, other instruments or securities outstanding or
agreements in effect which would substantially diminish or otherwise
eliminate the benefits intended to be afforded by the Rights.
(p) Notwithstanding anything in this Agreement to the contrary, in
the event that the Company shall at any time after the Record Date and prior
to the Distribution Date: (i) declare a dividend on the outstanding shares
of Common Stock of the Company payable in shares of Common Stock of the
Company, (ii) subdivide the outstanding shares of Common Stock of the
Company, or (iii) combine the outstanding shares of Common Stock of the
Company into a smaller number of shares, then the number of Rights associated
with each share of Common Stock of the Company then outstanding, or issued or
delivered thereafter but prior to the Distribution Date, shall be
proportionately adjusted so that the number of Rights thereafter associated
with each share of Common Stock of the Company following any such event shall
equal the result obtained by multiplying the number of Rights associated with
each share of Common Stock of the Company immediately prior to such event by
a fraction, the numerator of which shall be the total number of shares of
Common Stock of the Company outstanding immediately prior to the occurrence
of the event and the denominator of which shall be the total number of shares
of Common Stock of the Company outstanding immediately following the
occurrence of such event.
(q) The exercise of Rights under SECTION 11(a)(ii) shall only result
in the loss of rights under SECTION 11(a)(ii) to the extent so exercised and
shall not otherwise affect the rights provided for under this Agreement,
including the rights provided for by SECTION 13.
(r) Notwithstanding any other provision of this Agreement to the
contrary, if the Company determines that a registration statement filed
pursuant to SECTION 9(c) hereof is required to be amended or supplemented to
continue to comply with the Securities Act, then the Company may suspend the
exercisability of the Rights and shall promptly after such determination take
all necessary steps to cause to be effective such amended or supplemented
registration statement. Immediately following such determination to amend or
supplement such registration statement, and immediately following the time
such amended or supplemented registration statement shall become effective,
the Company shall publicly announce the suspension of the exercisability of
the Rights or the termination of such suspension.
SECTION 12. CERTIFICATE OF ADJUSTED PURCHASE PRICE OR NUMBER OF SHARES.
Whenever an adjustment is made as provided in SECTION 11 and SECTION 13
hereof, the Company shall: (a) promptly prepare a certificate setting forth
such adjustment, and a brief statement of the facts accounting for such
adjustment; (b) promptly file with the Rights Agent and with each transfer
agent for the Preferred Stock and the Common Stock copy of such certificate;
and (c) mail a brief summary thereof to each holder of a Rights Certificate
(or, if prior to the Distribution Date, to each holder of a certificate
representing Shares of Common Stock) in accordance with SECTION 25 hereof.
The Rights Agent shall be fully protected in relying on any such certificate
and on any adjustment therein contained.
SECTION 13. CONSOLIDATION, MERGER OR SALE OR TRANSFER OF ASSETS OR EARNING
POWER.
(a) EFFECT ON RIGHTS. In the event that, following the Share
Acquisition Date, directly or indirectly: (x) the Company shall consolidate
with, or merge with and into, any other Person (other than a Subsidiary of
the Company in a transaction that complies with SECTION 11(o) hereof) and the
Company shall not be the surviving or continuing corporation of such
consolidation or merger; (y) any Person (other than a Subsidiary of the
Company in a transaction that complies with SECTION 11(o) hereof) shall
consolidate with, or merge with or into, the Company, and the Company shall
be the continuing or surviving corporation of such consolidation or merger
and, in connection with such consolidation or merger, all or part of the
outstanding Shares of Common Stock of the Company shall be changed into or
exchanged for stock or other securities of any other Person or cash or any
other property; or (z) the Company shall sell or otherwise transfer (or one
or more of its subsidiaries shall sell or otherwise transfer), in one
transaction, or a series of related transactions, assets or earning power
aggregating more than 50 percent of the assets or earning power of the
Company and its subsidiaries (taken as a whole) to any other Person or
Persons (other than the Company or any Subsidiary of the Company in one or
more transactions each of which complies with SECTION 11(o) hereof), then,
and in each such case (except as may be contemplated by SECTION 13(d)
hereof), proper provision shall be made so that: (i) each holder of a Right
(except as provided in SECTION 7(e) hereof) shall thereafter be entitled to
receive, upon the exercise thereof at the then current Purchase Price in
accordance with the terms of this Agreement, such number of shares of validly
authorized and issued, fully paid, non-assessable and freely tradable Common
Stock of the Principal Party (as hereinafter defined), not subject to any
liens, encumbrances, rights of call or first refusal, or other adverse claims
as shall be equal to the result obtained by (A) multiplying the then current
Purchase Price by the then number of 1/1,000ths of a share of Preferred Stock
for which a Right is then exercisable immediately prior to the first
occurrence of any of the events described in subsections (x), (y) or (z) of
this paragraph (a) of SECTION 13 (each a "SECTION 13 EVENT") (or, if an event
described in SECTION 11(a)(ii) (each a "SECTION 11(a)(ii) EVENT") has
occurred prior to the first occurrence of a Section 13 Event, multiplying the
number of such 1/1,000ths of a share for which a Right was exercisable
immediately prior to the first occurrence of a Section 11(a)(ii) Event) by
the Purchase Price in effect immediately prior to such first occurrence, and
(B) dividing that product (which following the first occurrence of a Section
13 Event, shall be referred to as the "PURCHASE PRICE" for each Right and for
all purposes of the Agreement) by 50 percent of the current market price per
share of the Common Stock of such Principal Party (determined in the manner
described in SECTION 11(d)(i) hereof) on the date of consummation of such
Section 13 Event; (ii) the Principal Party shall thereafter be liable for,
and shall assume, by virtue of such Section 13 Event, all the obligations and
duties of the Company pursuant to this Agreement; (iii) the term "COMPANY"
shall thereafter be deemed to refer to such Principal Party, it being
specifically intended that the provisions of SECTION 11 hereof apply to such
Principal Party following the first occurrence of a Section 13 Event; and
(iv) such Principal Party shall take such steps (including, but not limited
to, the authorization and reservation of a sufficient number of shares of its
Common Stock) in connection with the consummation of any such transaction as
may be necessary to assure that the provisions hereof shall thereafter be
applicable, as nearly as reasonably may be, in relation to the shares of its
Common Stock thereafter deliverable upon the exercise of the Rights.
(b) DEFINITION OF PRINCIPAL PARTY. The term "PRINCIPAL PARTY" shall
mean:
(i) in the case of any transaction described in subsection (x)
or (y) of paragraph (a) of this SECTION 13, the Person that is the
issuer of any securities into which shares of Common Stock of the
Company are converted in such merger or consolidation, and if no
securities are so issued, the Person that is the other party to the
merger or consolidation; or
(ii) in the case of any transaction described in subsection (z)
of paragraph (a) of this SECTION 13, the Person that is the party
receiving the greatest portion of the assets or earning power
transferred pursuant to such transaction or transactions;
PROVIDED, HOWEVER, that in any such case, (x) if the Common Stock of such
Person is not at such time and has not been continuously over the
preceding 12-month period registered under Section 12 of the Exchange Act,
and such Person is a direct or indirect Subsidiary of another Person the
Common Stock of which is and has been so registered, "PRINCIPAL PARTY"
shall refer to such other Person the Common Stock of which is so
registered; (y) in case such Person is a Subsidiary, directly or
indirectly, of more than one Person, the Common Stocks of all of which are
and have been so registered, "PRINCIPAL PARTY" shall refer to whichever of
such Persons is the issuer of the Common Stock having the greatest market
value of shares held by the public, and (z) in case such Person is owned,
directly or indirectly, by a joint venture formed by two or more Persons
that are not owned, directly or indirectly, by the same Person, the rules
set forth in (x) and (y) above shall apply to each of the chains of
ownership having an interest in such joint venture as if such party were a
"Subsidiary" of both or all of such joint venturers and the Principal
Parties in each such chain shall bear the obligations sat forth in this
SECTION 13 in the same ratio as their direct or indirect interests in such
Person bear to the total of such interests.
(c) LIMITATION ON CONSUMMATION OF MERGERS. The Company shall not
consummate any such consolidation, merger, sale or transfer unless the
Principal Party shall have a sufficient number of authorized shares of its
Common Stock that have not been issued or reserved for issuance to permit the
exercise in full of all of the Outstanding Rights in accordance with this
SECTION 13 and unless prior thereto the Company and such Principal Party
shall have executed and delivered to the Rights Agent a supplemental
agreement providing for the terms set forth in paragraphs (a) and (b) of this
SECTION 13 and further providing that, as soon as practicable after the date
of any consolidation, merger or sale of assets mentioned in paragraph (a) of
this SECTION 13, the Principal Party will:
(i) prepare and file a registration statement under the
Securities Act, with respect to the Rights and the securities
purchasable upon exercise of the Rights on an appropriate form, will
use its best efforts to cause such registration statement to (A) become
effective as soon as practicable after such filing, and (B) will use
its best efforts to cause such registration statement to remain
effective (with a prospectus at all times meeting the requirements of
the Securities Act) until the date of expiration of the Rights and will
use its best efforts to comply with all applicable State blue sky and
other securities laws; and
(ii) deliver to holders of the Rights historical financial
statements for the Principal Party and each of its Affiliates which
comply in all respects with the requirements for registration under the
Exchange Act.
The provisions of this SECTION 13 shall similarly apply to successive mergers
or consolidations or sales or other transfers. In the event that a Section 13
Event shall occur at any time after the occurrence of a SECTION 11(i)(ii)
Event, the Rights which have not theretofore been exercised shall thereafter
become exercisable in the manner described in SECTION 13(a).
(d) PERMITTED OFFERS. Notwithstanding anything in this Agreement to
the contrary, SECTION 13 shall not be applicable to a transaction described
in subsections (x) and (y) of paragraph (a) of this SECTION 13 if: (i) such
transaction is consummated with a Person or Persons who acquired shares of
Common Stock pursuant to a Permitted Offer (or a wholly owned subsidiary of
any such Person or Persons); (ii) the price per share of Common Stock of the
Company offered in such transaction is not less than the price per Common
Share of the Company paid to all holders of Common Stock of the Company whose
shares were purchased pursuant to such Permitted Offer; and (iii) the form of
consideration being offered to the remaining holders of Common Stock of the
Company pursuant to such transaction is the same as the form of consideration
paid pursuant to such Permitted Offer. Upon consummation of such transaction
contemplated by this paragraph (d), all Rights hereunder shall expire.
SECTION 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES.
(a) ISSUANCE OF FRACTIONAL RIGHTS. The Company shall not be required
to issue fractions of Rights, except prior to the Distribution Date in
accordance with SECTION 11(p) hereof, or to distribute Rights Certificates
that evidence fractional Rights. In lieu of such fractional Rights, there
shall be paid to the registered holders of the Rights 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 of the Rights 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 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 sale price or, if not so quoted, the average of the high
bid and low asked prices in the over-the-counter market, as reported by the
NASDAQ System 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 shall be as determined in good faith by the
Board, or, if at the time of such determination there is an Acquiring Person,
by a nationally recognized investment banking firm selected by such majority.
(b) ISSUANCE OF CERTAIN FRACTIONAL SHARES OF PREFERRED STOCK. The
Company shall not be required to issue fractions of shares of Preferred Stock
(other than fractions that are integral multiples of 1/1,000ths of a share of
Preferred Stock) upon exercise of the Rights or to distribute certificates
which evidence fractional shares (other than fractions that are integral
multiples of 1/1,000ths of a share of Preferred Stock). In lieu of
fractional shares that are not integral multiples of 1/1,000ths of a share of
Preferred Stock, the Company may pay to the registered holders of Rights
Certificates at the time such Rights are exercised as herein provided an
amount in cash equal to the same fraction of the current market value of
1/1,000ths of a share of Preferred Stock. For purposes of this SECTION
14(b), the current market value of 1/1,000ths of a share of Preferred Stock
shall be 1/1,000ths of the closing price of a share of Preferred Stock (as
determined pursuant to SECTION 11(d)(ii) for the Trading Day immediately
prior to the date of such exercise.
(c) Following the occurrence of a Triggering Event the Company shall
not be required to issue fractions of shares of its Common Stock upon
exercise of the Rights or to distribute certificates which evidence
fractional shares of such Common Stock. In lieu of fractional shares of such
Common Stock, the Company may pay to the registered holders of Rights
Certificates at the time such Rights are exercised as herein provided an
amount in cash equal to the same fraction of the current market value of one
(1) share of a the Common Stock of the Company. For purposes of this SECTION
14(c), the current market value of one share of Common Stock shall be the
closing price of one share of Common Stock (as determined pursuant to SECTION
11(d)(i) hereof) for the Trading Day immediately prior to the date of such
exercise.
(d) The holder of a Right by the acceptance of the Right expressly
waives his right to receive any fractional Rights or any fractional shares
upon exercise of a Right except as permitted by this SECTION 14.
SECTION 15. RIGHTS OF ACTION.
All rights of action in respect of this Agreement are vested in the
respective registered holders of the Rights Certificates (and, prior to the
Distribution Date, the registered holders of the Common Stock); and any
registered holder of any Rights Certificate (or, prior to the Distribution
Date, of the Common Stock), may, in his own behalf and for his own benefit,
enforce, and may institute and maintain any suit, action or proceeding
against the Company to enforce, or otherwise act in respect of, his right to
exercise the Rights evidenced by such Rights Certificate in the manner
provided in such Rights 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 Agents 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 Stock;
(b) after the Distribution Date, the Rights Certificates are
transferable only on the registry books of the Rights Agent if surrendered at
the principal office of the Rights Agent, duly endorsed or accompanied by a
proper instrument of transfer and with the appropriate forms and certificates
fully executed;
(c) subject to SECTION 6(a), SECTION 7(e) and SECTION 7(f) hereof,
the Company and the Rights Agent may deem and treat the Person in whose name
the Rights Certificate (or, prior to the Distribution Date, the associated
Common Stock certificate) is registered as the absolute owner thereof and of
the Rights evidenced thereby (notwithstanding any notations of ownership or
writing on the Rights Certificates or the associated Common Stock certificate
made by anyone other than the Company or the Rights Agent) for all purposes
whatsoever, and neither the Company nor the Rights Agent, subject to the last
sentence of SECTION 7(e) hereof, shall be required to be affected by any
notice to the contrary; and
(d) notwithstanding anything in this Agreement to the contrary,
neither the Company nor the Rights Agent shall have any liability to any
holder of a Right or other Person as a result of its inability to perform any
of its obligations under this Agreement by reason of any preliminary or
permanent injunction or other order, decree or ruling issued by a court of
competent jurisdiction or by a governmental, regulatory or administrative
agency or commission, or any statute, rule, regulation or executive order
promulgated or enacted by any governmental authority, prohibiting or
otherwise restraining performance of such obligation; PROVIDED, HOWEVER, the
Company must use its best efforts to have any such order, decree or ruling
lifted or otherwise overturned as soon as possible.
SECTION 17. RIGHTS CERTIFICATE HOLDER NOT DEEMED A STOCKHOLDER.
No holder, as such, of any Rights Certificate shall be entitled to
vote, receive dividends or be deemed for any purpose the holder of the number
of shares of Preferred Stock or any other securities of the Company which may
at any time be issuable on the exercise of the Rights represented thereby,
nor shall anything contained herein or in any Rights Certificate be construed
to confer upon the holder of any Rights Certificate, as such, any of the
rights of a stockholder of the Company or any right to vote for the election
of directors or upon any matter submitted to stockholders at any meeting
thereof, or to give or withhold consent to any corporate action, or to
receive notice of meetings or other actions affecting stockholders (except as
provided in SECTION 24), or to receive dividends or subscription rights, or
otherwise, until the Right or Rights evidenced by such Rights Certificates
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 reasonable
compensation for all services rendered by it hereunder and, from time to
time, on demand of the Rights Agent, its reasonable expenses and counsel fees
and other disbursements incurred in the administration and execution of this
Agreement and the exercise and performance of its duties hereunder. The
Company also agrees to indemnify the Rights Agent for, and to hold it
harmless against, any loss, liability or expense incurred without negligence,
bad faith or willful misconduct on the part of the Rights Agent, for anything
done or omitted by the Rights Agent in connection with the acceptance and
administration of this Agreement, including the cost and expenses of
defending against any claim of liability in the premises and reasonable
counsel fees and expenses.
(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
Rights Certificate or certificate for the Common Stock or for other
securities of the Company, instrument of assignment or transfer, power of
attorney, endorsement, affidavit, letter, notice, direction, consent,
certificate, statement, or other paper or document believed by it to be
genuine and to be signed, executed and, where necessary, verified or
acknowledged, by the proper Person or Persons.
(c) Anything in this Agreement to the contrary notwithstanding, in no
event shall the Rights Agent be liable for special, indirect 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 likelihood of such
loss or damage and regardless of the form of action.
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 corporate trust, stock transfer or other stockholder
services 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, HOWEVER, that such corporation would be eligible for
appointment as a successor Rights Agent under the provisions of SECTION 21
hereof. In case at the time such successor Rights Agent shall succeed to the
agency created by this Agreement, any of the Rights 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
Rights Certificate so countersigned; and in case at that time any of the
Rights Certificates shall not have been countersigned, any successor Rights
Agent may countersign such Rights 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 Rights Certificates shall have the full force provided in
the Rights 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 Rights Certificates shall have been countersigned
but not delivered, the Rights Agent may adopt the countersignature under its
prior name and deliver Rights Certificates so countersigned; and in case at
that time any of the Rights Certificates shall not have been countersigned,
the Rights Agent may countersign such Rights Certificates either in its prior
name or in its changed name; and in all such cases such Rights Certificates
shall have the full force provided in the Rights Certificates and in this
Agreement.
SECTION 20. DUTIES OF RIGHTS AGENT.
The Rights Agent undertakes the duties and obligations imposed by this
Agreement upon the following terms and conditions, by all of which the
Company and the holders of Rights Certificates, by their acceptance thereof,
shall be bound:
(a) The Rights Agent may consult with the legal counsel (who may be
legal counsel for the Company), and the opinion of such counsel shall be full
and complete authorization and protection to the Rights Agent as to any
action taken or omitted by it in good faith and in accordance with such
opinion.
(b) Whenever in the performance of its duties under this Agreement
the Rights Agent shall deem it necessary or desirable that any fact or matter
be proved or established by the Company prior to taking or suffering any
action hereunder, such fact or matter (unless other evidence in respect
thereof be herein specifically prescribed) may be deemed to be conclusively
proved and established by a certificate signed by any one of the Chairman of
the Board, the President, any Vice President, the Treasurer, any assistant
Treasurer, the Secretary, or any assistant Secretary of the Company and
delivered to the Rights Agent; and such certificate shall be full
authorization to the Rights Agent for any action taken or suffered in good
faith by it under the provisions of this Agreement in reliance upon such
certificate.
(c) The Rights Agent shall be liable hereunder 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
Rights Certificates (except as to 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 Rights 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 Rights
Certificate; nor shall it be responsible for any adjustment required under
the provisions of SECTION 11 or SECTION 13 hereof or be responsible for the
manner, method or amount of any such adjustment or the ascertaining of the
existence of facts that would require any such adjustment (except with
respect to the exercise of Rights evidenced by Rights Certificates after
actual notice of any such adjustment); nor shall it by any act hereunder be
deemed to make any representation or warranty as to the authorization or
reservation of any shares of Common Stock or Preferred Stock to be issued
pursuant to this Agreement or any Rights Certificate or as to whether any
shares of the Common Stock or Preferred Stock will, when so issued, be
validly authorized and issued, fully paid and non-assessable.
(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 be reasonably
required by the Rights Agent for the carrying out or performing by the Rights
Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from any
one of the Chairman of the Board, the President, any Vice President, the
Treasurer, any assistant Treasurer, the Secretary, or any assistant Secretary
of the Company, and to apply to such officers for advice or instructions in
connection with its duties, and it shall not be liable for any action taken
or suffered to be taken by it in good faith in accordance with instructions
of any such officer.
(h) The Rights Agent and any stockholder, director, officer or
employee of the Rights Agent may buy, sell or deal in any of the Rights or
other securities of the Company or 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 that reasonable care was
exercised in the selection and continued employment thereof.
(j) No provision of this Agreement shall require the Rights Agent to
expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder or in the exercise of its
rights if there shall be reasonable grounds for believing that repayment of
such funds or adequate indemnification against such risk or liability is not
reasonably assured to it.
(k) If, with respect to any Rights Certificate surrendered to the
Rights Agent for exercise or transfer, the certificate attached to the form
of assignment or form of election to purchase, as the case may be, has either
not been completed or indicated an affirmative response to clause 1 and/or 2
thereof, the Rights Agent shall not take any further action with respect to
such requested exercise of transfer without first consulting with the
Company.
SECTION 21. CHANGE OF RIGHTS AGENT.
The Rights Agent or any successor Rights Agent may resign and be
discharged from its duties under this Agreement and upon 30 days notice in
writing mailed to the Company and to each transfer agent of the Preferred
Stock and the Common Stock by registered or certified mail, and to the
holders of the Rights Certificates by first class mail. The Company may
remove the Rights Agent or any successor Rights Agent upon 30 days' notice in
writing, mailed to the Rights Agent or successor Rights Agent, as the case
may be, and to each transfer agent of the Preferred Stock and the Common
Stock by registered or certified mail, and to the holders of the Rights
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 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 Rights
Certificate (who shall, with such notice, submit his Rights Certificate for
inspection by the Company), then the registered holder of any Rights
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: (i) a corporation
organized, existing and doing business under the laws of the United States or
of any state of the United States, in good standing, which is authorized
under such laws to exercise corporate trust 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 (ii) an Affiliate of a corporation
described in clause (i) of this sentence. After appointment, the successor
Rights Agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Rights Agent without
further act or deed; but the predecessor Rights Agent shall deliver and
transfer to the successor Rights Agent any property at the time held by it
hereunder, and execute and deliver any further assurance, conveyance, act or
deed necessary for the purpose. Not later than the effective date of any
such appointment the Company shall file notice thereof in writing with the
predecessor Rights Agent and each transfer agent of the Preferred Stock and
the Common Stock, and mail a notice thereof in writing to the registered
holders of the Rights 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 RIGHTS CERTIFICATES.
Notwithstanding any of the provisions of this Agreement or of the
Rights to the contrary, the Company may, at its option, issue new Rights
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 per
share and the number or kind or class of shares or other securities or
property purchasable under the Rights Certificates made in accordance with
the provisions of this Agreement. In addition, in connection with the
issuance or sale of shares of Common Stock of the Company following the
Distribution Date and prior to the redemption or expiration of the Rights,
the Company (a) shall, with respect to such shares of Common Stock so issued
or sold pursuant to the exercise of stock options or under any employee plan
or arrangement granted or awarded prior to or as of the Distribution Date, or
upon the exercise, conversion or exchange of securities hereinafter issued by
the Company, and (b) may, in any other case, if deemed necessary or
appropriate by the Board of Directors of the Company, issue Rights
Certificates representing the appropriate number of Rights in connection with
such issuance or sale; PROVIDED, HOWEVER, that (i) no such Rights Certificate
shall be issued if, and to the extent that, the Company shall be advised by
counsel that such issuance would create a significant risk of material
adverse tax consequences to the Company or the Person to whom such Rights
Certificates would be issued, and (ii) no such Rights Certificate shall be
issued if, and to the extent that, appropriate adjustment shall otherwise
have been made in lieu of the issuance thereof.
SECTION 23. REDEMPTION AND TERMINATION.
(a) The Board of Directors of the Company may, at its option, at any
time prior to 5:00 p.m., New York, New York time, on the earlier of (x) the
Share Acquisition Date (or if the Share Acquisition Date shall have occurred
prior to the Record Date, the close of business on the tenth day following
the Record Date) or (y) the Final Expiration Date, redeem all but not less
than all of the then outstanding Rights at a redemption price of $0.0005 per
Right as such amount may be appropriately adjusted to reflect any stock
split, stock dividend or similar transaction occurring after the date hereof
(such redemption price being hereinafter referred to as the "REDEMPTION
PRICE"), PROVIDED, HOWEVER, that if, following the occurrence of a Share
Acquisition Date but prior to any event described in SECTION 13(a), either
(x) in connection with any event specified in SECTION 13(a) in which all
holders of Common Stock are treated alike and not involving (other than as a
holder of Common Stock being treated like all other such holders) an
Acquiring Person or an Affiliate or Associate of an Acquiring Person or any
other person in which such Acquiring Person, Affiliate or such Associate has
any interest, or any other Person acting directly or indirectly on behalf of
or in association with any such Acquiring Person, Affiliate or Associate, or
(y) following the occurrence of an event set forth in, and the expiration of
any period during which the holders of Rights may exercise the Rights under,
SECTION 11(a)(ii) if each of the following shall have occurred and remain in
effect: (i) such SECTION 11(a)(ii) Event shall be deemed inadvertent as
determined by the Board in its discretion taking into account all such
factors as the Board deems relevant; (ii) a Person who is an Acquiring Person
shall have transferred or otherwise disposed of a number of shares of Common
Stock in a transaction, or series of transactions, which did not result in
the occurrence of a Triggering Event such that such Person is thereafter a
Beneficial Owner of 10 percent or less of the outstanding shares of Common
Stock of the Company, (iii) there are no other Persons, immediately following
the occurrence of the event described in clause (ii) hereof, who is Acquiring
Persons, and (iv) the transfer or other disposition described in clause (ii)
hereof, above was other than pursuant to a transaction, or series of
transactions, which directly or indirectly involved the Company or any of its
Subsidiaries, then the right of redemption shall be reinstated and thereafter
be subject to the provisions of this SECTION 23.
(b) Immediately upon the action of the Board of Directors of the
Company ordering the redemption of the Rights, 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. Promptly after the action of the Board of Directors
ordering the redemption for the Rights, the Company shall file with the
Rights Agent evidence of such action by the Board of Directors and shall give
notice of such redemption to the holders of the then outstanding Rights by
mailing such notice to each such holder at such holder's last address as it
appears upon the registry books of the Rights Agent or, prior to the
Distribution Date, on the registry books of the Transfer Agent for the Common
Stock of the Company. Any notice which is mailed in the manner herein
provided shall be deemed given, whether or not the holder receives the
notice. Each such notice of redemption will state the method by which the
payment of the Redemption Price will be made. Neither the Company nor any of
its Affiliates or Associates may redeem, acquire or purchase for value any
Rights at any time in any manner other than that specifically set forth in
this SECTION 23, and other than in connection with the purchase of Common
Stock of the Company prior to the Distribution Date.
SECTION 24. NOTICE OF CERTAIN EVENTS.
(a) In case the Company shall propose at any time following the
Distribution Date: (i) to pay any dividend payable in stock of any class to
the holders of Preferred Stock or to make any other distribution to the
holders of Preferred Stock (other than a regular periodic cash dividend at a
rate not in excess of 125 percent of the rate of the last cash dividend
theretofore paid); (ii) to offer to the holders of Preferred Stock rights or
warrants to subscribe for or to purchase any additional shares of Preferred
Stock or shares of stock of any class or any other securities, rights or
options; (iii) to effect any reclassification of Preferred Stock (other than
a reclassification involving only the subdivision of outstanding shares of
Preferred Stock); (iv) to effect any consolidation or merger into or with any
other Person (other than a Subsidiary of the Company in a transaction or
transactions that comply with SECTION 11(o) hereof); (v) 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 more than 50 percent
of the assets or earning power of the Company and its subsidiaries (taken as
a whole) to, any other Person (other than a Subsidiary of the Company in a
transaction or transactions that comply with SECTION 11(o) hereof); or (vi)
to effect the liquidation, dissolution or winding up of the Company, then, in
each such case, the Company shall give to each holder of a Rights
Certificate, in accordance with SECTION 25, a notice of such proposed action,
which shall specify the record date for, and the purposes of, such stock
dividend, 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 Preferred Stock, 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 twenty days prior to the record date for
determining holders of Preferred Stock for purposes of such action, and in
the case of any such other action, at least twenty days prior to the date of
the taking of such proposed action or the date of participation therein by
the holders of the Preferred Stock, whichever shall be earlier.
(b) In case any of the events set forth in SECTION 11(a)(ii) of this
Agreement shall occur, then, in any such case; (i) the Company shall, as soon
as practicable thereafter, give to each holder of a Rights Certificate, in
accordance with SECTION 25 and to the extent feasible, a notice of the
occurrence of such event, which shall specify the event and the consequences
of the event to holders of Rights under SECTION 11(a)(ii); and (ii) all
references in the preceding paragraph to Preferred Stock shall be deemed to
thereafter refer to Common Stock and/or other securities, as the case may be.
SECTION 25. NOTICES.
Notices or demands authorized by this Agreement to be given or made by
the Rights Agent or by the holder of any Rights 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:
Xxxxxxxx Financial, Inc.
Attn.: President
000 Xxxx 00xx Xxxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
Subject to the provisions of SECTION 21, any notice or demand authorized by
this Agreement to be given or made by the Company or by the holder of any
Rights 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:
UMB Bank, N.A.
Attn.: Corporate Stock Transfer Department
0000 Xxxxx Xxxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Rights 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 26. SUPPLEMENTS AND AMENDMENTS.
Prior to the Distribution Date and subject to the penultimate sentence
of this SECTION 26, the Company and the Rights Agent shall, if the Company so
directs, supplement or amend any provision of this Agreement without the
approval of any holders of Rights Certificates. From and after the
Distribution Date and subject to the penultimate sentence of this SECTION 26,
the Company and the Rights Agent shall, if the Company so directs,
supplement, amend, remove any provision of this Agreement without approval of
any holders of Rights in order: (i) to cure any ambiguity; (ii) to correct or
supplement any provision contained herein that may be defective or
inconsistent with any other provisions herein; (iii) to shorten or lengthen
any time period hereunder (which lengthening or shortening, following the
first occurrence of an event set forth in clauses (i) and (ii) of the first
provision to SECTION 23(a) hereof, shall be effective only if approved by at
least 70 percent of the then members of the Board); or (iv) to change or
supplement the provisions hereunder in any manner which the Company may deem
necessary or desirable and which shall not adversely affect the interests of
the holders of Rights Certificates (other than an Acquiring Person or an
Affiliate or Associate of an Acquiring Person); PROVIDED, this Agreement may
not be supplemented or amended to lengthen, pursuant to clause (iii) of this
sentence, (A) a time period relating to when the Rights may be redeemed at
such time as the Rights are not then redeemable, or (B) any other time period
unless such lengthening is for the purpose of protecting, enhancing or
clarifying the rights of, and/or the benefits to, the holders of Rights.
Upon the delivery of a certificate from an appropriate officer of the Company
that states that the proposed supplement or amendment is in compliance with
the terms of this SECTION 26, the Rights Agent shall execute such supplement
or amendment unless the Rights Agent shall have determined in good faith that
such supplement or amendment would adversely affect its interests under this
Agreement. Notwithstanding anything contained in this Agreement to the
contrary, no supplement or amendment shall be made which changes the
Redemption Price, the Final Expiration Date, the Purchase Price or the number
of 1/1,000ths of a share of Preferred Stock for which a Right is exercisable.
Prior to the Distribution Date, the interests of the holders of Rights shall
be deemed coincident with the interests of the holders of Common Stock of the
Company.
SECTION 27. 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 28. DETERMINATION AND ACTIONS BY THE BOARD OF DIRECTORS, ETC.
For all purposes of this Agreement, any calculation of the number of
shares of Common Stock of the Company outstanding at any particular time,
including for purposes of determining the particular percentage of such
outstanding shares of Common Stock of the Company of which any Person is the
Beneficial Owner, shall be made in accordance with the provisions of Rule
13d-3(d)(l)(i) of the General Rules and Regulations under the Exchange Act.
The Board of Directors of the Company shall have the exclusive power and
authority to administer this Agreement and to exercise all rights and powers
specifically granted to the Board or the Company, or as may be necessary or
advisable in the administration of this Agreement, including, without
limitation, the right and power to (i) interpret the provisions of this
Agreement, and (ii) make all determinations deemed necessary or advisable for
the administration of this Agreement (including a determination to redeem or
not redeem the Rights or to amend the Agreement). All such actions,
calculations, interpretations and determinations (including, for the purpose
of clause (ii) below, all omissions with respect to the foregoing which are
done or made by the Board) in good faith, shall (i) be final, conclusive and
binding on the Company, the Rights Agent, the holders of the Rights
Certificates and all other parties, and (ii) not subject to the Board to any
liability to the holders of the Rights Certificates.
SECTION 29. BENEFITS OF THIS AGREEMENT.
Nothing in this Agreement shall be construed to give any Person other
than the Company, the Rights Agent and the registered holders of the Rights
Certificates any legal or equitable right, remedy or claim under this
Agreement; and this Agreement shall be for the sole and exclusive benefit of
the Company, the Rights Agent and the registered holders of the Rights
Certificates.
SECTION 30. SEVERABILITY.
If any term, provision, covenant or restriction of this Agreement is
held by a court of competent jurisdiction or other authority to be invalid,
void or unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and
shall in no way be affected, impaired or invalidated; PROVIDED, HOWEVER, that
notwithstanding anything in this Agreement to the contrary, if any such term,
provision, covenant or restriction is held by such court or authority to be
invalid, void or unenforceable and the Board of Directors of the Company
determines in its good faith judgment that severing the invalid language from
this Agreement would adversely affect the purpose or effect of this
Agreement, the right or redemption set forth in SECTION 23 hereof shall be
reinstated and shall not expire until the close of business on the tenth day
following the date of such determination by the Board of Directors. Without
limiting the foregoing, if any provision requiring a majority of the Board of
Directors of the Company to be Continuing Directors to act is held by any
court of competent jurisdiction or other authority to be invalid, void or
unenforceable, such determination shall then be made by the Board of
Directors of the Company in accordance with applicable law and the Company's
Certificate of Incorporation and By-Laws.
SECTION 31. GOVERNING LAW.
This Agreement, each Rights Certificate and each Right 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, except for SECTIONS 18, 19, 20 AND 21 hereof and
relating to the rights, duties and obligations of the Rights Agent, which
shall be governed by the laws of the State of [__________] without reference
to its choice of law rules.
SECTION 32. COUNTERPARTS.
This Agreement may be executed in any number of counterparts and each
of such counterparts shall for all purposes be deemed to be an original, and
all such counterparts shall together constitute but one and the same
instrument.
SECTION 33. DESCRIPTIVE HEADINGS.
Descriptive headings of the several Sections of this Agreement are
inserted for convenience only and shall not control or affect the meaning or
construction of any of the provisions hereof.
IN WITNESS HEREOF, the parties hereto have caused this Agreement to be
duly executed and their respective corporate seals to be hereunto affixed and
attested all as of the day and year first above written.
[SEAL] XXXXXXXX FINANCIAL, INC.
Attest:
By: By:
---------------------------- -------------------------------------
Name: Name:
------------------------ --------------------------------
Title: Title:
----------------------- -------------------------------
[SEAL]
Attest:
By:
-------------------------------- -------------------------------------
Name: Name:
------------------------ --------------------------------
Title: Title:
----------------------- -------------------------------
EXHIBIT A
FORM OF
CERTIFICATE OF DESIGNATION
OF
XXXXXXXX FINANCIAL, INC.
SERIES A PREFERRED STOCK
Xxxxxxxx Financial, Inc., a corporation organized and existing under
and by virtue of The General and Business Corporation Law of Delaware, DOES
HEREBY CERTIFY:
That at a meeting of the Board of Directors of Xxxxxxxx Financial, Inc.
the following resolution was duly adopted creating [_______] shares of
Preferred Stock, designated as Series A Preferred Stock.
RESOLVED, that pursuant to the authority
granted to and vested in the Board of Directors of
this Corporation in accordance with the provisions of
the Articles of Incorporation, as amended, a series
of Series A Preferred Stock of the Corporation be,
and it hereby is created, and the designation and
amount thereof and the voting powers, preferences and
relative, participating, optional and other special
rights of such series, and the qualifications,
limitations or restrictions thereof (in addition to
the provisions set forth in the Articles of
Incorporation, as amended, of the Corporation, which
are applicable to the Preferred Stock of all classes
and series) are as follows:
1. DESIGNATION AND AMOUNT. The shares of such series shall be
designated as "SERIES A PREFERRED STOCK" and the number of shares initially
constituting such series shall be [________].
2. DIVIDENDS AND DISTRIBUTIONS.
---------------------------
(A) Subject to any prior and superior rights of the holders of
any series of Preferred Stock ranking prior and superior to the shares of
Series A Preferred Stock with respect to dividends, the holders of shares of
Series A Preferred Stock shall be entitled prior to the payment of any
dividends on shares ranking junior to the Series A Preferred Stock 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
last 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 Preferred Stock, in an amount per
share (rounded to the nearest cent) equal to the greater of (a) $10.00 or (b)
subject to the provision for adjustment hereinafter set forth, 1,000 times
the aggregate per share amount of all cash dividends, and 1,000 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,
par value $0.001 per share, of the Corporation (the "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 Preferred Stock. In the event the Corporation shall at any
time after [_______________], 1999 (the "RIGHTS DECLARATION DATE") (i)
declare any dividend on Common Stock payable in shares of Common Stock, (ii)
subdivide the outstanding Common Stock, or (iii) combine the outstanding
Common Stock into a smaller number of shares, then in each such case the
amount to which holders of shares of Series A 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. Such adjustment
shall be made successively whenever such a dividend or change in the Common
Stock is consummated.
(B) The Corporation shall declare a dividend or distribution on
the Series A Preferred Stock as provided in paragraph (A) above 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 $10.00 per share on
the Series A Preferred Stock shall nevertheless be payable on such subsequent
Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Preferred Stock from the Quarterly Dividend
Payment Date next preceding the date of issue of such shares of Series A
Preferred Stock, unless the date of issue of such shares is prior to the
record date for the first Quarterly Dividend Payment Date, in which case
dividends on such shares shall begin to accrue from the date of issue of such
shares, or unless the date of issue is a Quarterly Dividend Payment Date or
is a date after the record date for the determination of holders of shares of
Series A 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 Preferred Stock in an amount less
than the total amount of such dividends at the time accrued ant 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 Preferred Stock
entitled to receive payment of a dividend or distribution declared thereon,
which record date shall be no more than 30 days prior to the date fixed for
the payment thereof.
3. VOTING RIGHTS. The holders of shares of Series A Preferred Stock
shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set
forth, each 1/1,000th share of Series A Preferred Stock shall entitle the
holder thereof to one vote on all matters voted on at a meeting of the
stockholders of the Corporation. In the event the Corporation shall at any
time after the Rights Declaration Date (i) declare any dividend on Common
Stock payable in shares of Common Stock, or (ii) subdivide the outstanding
Common Stock, or (iii) combine the outstanding Common Stock into a smaller
number of shares, then in each such case the number of votes per share to
which holders of shares of Series A 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. Such adjustment shall be made successively whenever such a
dividend or change in the Common Stock is consummated.
(B) Except as otherwise provided herein or by law, the holders
of shares of Series A Preferred Stock and the holders of shares of Common
Stock shall vote together as one class on all matters voted on at a meeting
of stockholders of the Corporation.
(C) Except as set forth herein, holders of Series A 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.
4. CERTAIN RESTRICTIONS.
--------------------
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series A 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 Preferred Stock
outstanding shall have been paid in full, the Corporation shall not
(i) declare or pay dividends on, make any other
distributions on, or redeem or purchase or otherwise acquire for
consideration any shares of capital stock of the Corporation ranking junior
(either as to dividends or upon liquidation, dissolution or winding up) to
the Series A Preferred Stock;
(ii) declare or pay dividends on or make any other
distributions on any shares of capital stock of the Corporation ranking on a
parity (either as to dividends or upon liquidation, dissolution or winding
up) with the Series A Preferred Stock, except dividends paid ratably on the
Series A 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 capital stock of the Corporation ranking on a
parity (either as to dividends or upon liquidation, dissolution or winding
up) with the Series A Preferred Stock; provided that the Corporation may at
any time redeem, purchase or otherwise acquire shares of any such parity
stock in exchange for shares of any capital stock of the Corporation ranking
junior (either as to dividends or upon dissolution, liquidation or winding
up) to the Series A Preferred Stock; or
(iv) purchase or otherwise acquire for consideration any
shares of Series A Preferred Stock or any shares of stock ranking on a parity
with the Series A 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
capital stock of the Corporation unless the Corporation could, under
paragraph (A) of this SECTION 4, purchase or otherwise acquire such shares at
such time and in such manner.
5. REACQUIRED SHARES. Any shares of Series A Preferred Stock
purchased or otherwise acquired by the Corporation in any manner whatsoever
shall be retired and cancelled promptly after the acquisition thereof. All
such shares shall upon their cancellation become authorized but unissued
shares of Preferred Stock and may be reissued as part of a new series of
Preferred Stock to be created by resolution or resolutions of the Board of
Directors, subject to the conditions and restrictions on issuance set forth
herein.
6. LIQUIDATION, DISSOLUTION OR WINDING UP.
--------------------------------------
(A) In the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, no distribution shall be made
on any shares of capital stock of the Corporation that rank junior (whether
as to dividends or upon liquidation, dissolution or winding up) to Series A
Preferred unless prior thereto the holders of Series A Preferred Shares shall
have received an amount equal to 1,000 times the aggregate amount to be
distributed per share to holders of the common stock.
(B) In the event, however, that there are not sufficient assets
available to permit payment in full of the Series A liquidation preference
and the liquidation preferences of all other series of preferred stock, if
any, which rank on a parity with the Series A Preferred Stock, then such
remaining assets shall be distributed ratably to the holders of such parity
shares in proportion to their respective liquidation preferences.
(C) In the event the Corporation shall at any time after the
Rights Declaration Date (i) declare any dividend on Common Stock payable in
shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine the outstanding Common Stock into a smaller number of shares, then in
each such case the Adjustment Number in effect immediately prior to such
event shall be adjusted by multiplying such Adjustment Number by a fraction
the numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.
7. MERGER; CONSOLIDATION. ETC. In case the Corporation shall enter
into any merger, consolidation, 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 Preferred Stock shall at the same time be similarly exchanged or
changed in an amount per share (subject to the provision for adjustment
hereinafter set forth) equal to 1,000 times the aggregate amount of stock,
securities, cash and/or other property (payable in kind), as the case may be,
into which or for which each share of Common Stock is changed or exchanged.
In the event the Corporation shall at any time after the Rights Declaration
Date (i) declare any dividend on Common Stock payable in shares of Common
Stock, (ii) subdivide the outstanding Common Stock, or (iii) combine the
outstanding Common Stock into a smaller number of shares, then, in each such
case, the amount set forth in the preceding sentence with respect to the
exchange or change of shares of Series A 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.
8. NO REDEMPTION. The Series A Preferred Stock shall not be
redeemable.
9. RANKING. The Series A Preferred Stock shall rank on a parity with
all other series of the Corporation's Preferred Stock as to the payment of
dividends and other distribution of assets, unless the terms of any such
other series shall provide otherwise.
10. AMENDMENT. The Certificate of Incorporation of the Corporation
shall not be further amended in any manner that would materially alter or
change the powers, preferences, rights, qualifications, limitations and
restrictions of the Series A Preferred Stock so as to affect them adversely
without the affirmative vote of the holders of a majority or more of the
outstanding shares of Series A Preferred Stock, voting separately as a class.
11. FRACTIONAL SHARES. Series A 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 Preferred Stock.
IN WITNESS HEREOF, this Certificate of Designation is executed on
behalf of the Corporation by its President and attested by its Secretary
this [______] day of October, 1999.
XXXXXXXX FINANCIAL, INC.
By:-------------------------------
President
ATTEST:
----------------------------
Secretary
STATE OF MISSOURI )
) ss.
COUNTY OF XXXXXXX )
Before me, the undersigned Notary Public in and for said county and
state, this day personally appeared __________________________, personally
known to me to be the President of XXXXXXXX FINANCIAL, INC. and who executed
the foregoing instrument as President of Xxxxxxxx Financial, Inc., and being
first duly sworn, acknowledged reading in full and fully understanding the
foregoing, acknowledged the facts therein stated to be true and correct, and
who further acknowledged the execution of the same as the voluntary act of
the Corporation.
Witness my hand and seal this [______] day of October, 1999.
---------------------------------
Notary Public
My Commission Expires:
------------------------
EXHIBIT B
FORM OF RIGHTS CERTIFICATE
Certificate No. A- [___________] Rights
NOT EXERCISABLE AFTER [_____________] OR EARLIER IF
REDEEMED BY THE COMPANY. THE RIGHTS ARE SUBJECT TO
REDEMPTION, AT THE OPTION OF THE COMPANY, AT
$[__________________] PER RIGHT ON THE TERMS SET
FORTH IN THE RIGHTS AGREEMENT. UNDER CERTAIN
CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY AN
ACQUIRING PERSON (AS SUCH TERM IS DEFINED IN THE
RIGHTS AGREEMENT) AND ANY SUBSEQUENT HOLDER OF SUCH
RIGHTS MAY BECOME NULL AND VOID. [THE RIGHTS
PRESENTED BY THIS RIGHTS CERTIFICATE ARE OR WERE
BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME AN
ACQUIRING PERSON OR AN ASSOCIATE OR AFFILIATE OF AN
ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE
RIGHTS AGREEMENT). ACCORDINGLY, THIS RIGHTS
CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY
BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED
IN SECTION 7(e) OF THE RIGHTS AGREEMENT.]*
*The portion of the legend in brackets shall be inserted only if
applicable and shall replace the preceding sentence.
RIGHTS CERTIFICATE
------------------
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 October
[_____], 1999 (the "RIGHTS AGREEMENT") between Xxxxxxxx Financial, Inc., a
Delaware corporation (the "COMPANY"), and UMB Bank, N.A., a national banking
association organized and existing under the laws of the United States of
America (the "RIGHTS AGENT"), to purchase from the Company at any time prior
to 5:00 P.M. (New York, New York time) on [_______________] at the principal
office or offices of the Rights Agent designated for such purpose, or its
successors as Rights Agent, 1/1,000ths of a fully paid nonassessable share of
the Series A Preferred Stock (the "PREFERRED STOCK"), of the Company, at a
purchase price of $[_________] per 1/1,000ths of a share (the "PURCHASE
PRICE"), upon presentation and surrender of this Rights Certificate with the
Form of Election to Purchase and related Certificate duly executed. The
number of Rights evidenced by this Rights Certificate (and the number of
shares which may be purchased upon exercise thereof) set forth above, and the
Purchase Price per 1/1,000ths share set forth above, are the number and
Purchase Price as of [_______________], 1999, based on the Preferred Stock of
the Company as constituted at such date.
Upon the occurrence of a transaction listed in Section 11(a)(ii) (a
"SECTION 11(a)(ii) EVENT"), if the Rights evidenced by this Rights
Certificate are beneficially owned by (i) an Acquiring Person or an Affiliate
or Associate of any such Acquiring Person (as such terms are defined in the
Rights Agreement), (ii) a transferee of any such Acquiring Person, Associate
or Affiliate, or (iii) under certain circumstances specified in the Rights
Agreement, a transferee of a person who after such transfer, became an
Acquiring Person, or an Affiliate or Associate of an Acquiring Person, such
Rights shall become null and void and no holder hereof shall have any right
with respect to such Rights from and after the occurrence of such Section
11(a)(ii) Event.
As provided in the Rights Agreement, the Purchase Price and the number
and kind of shares of Preferred Stock or other securities which may be
purchased upon the exercise of the Rights evidenced by this Rights
Certificate are subject to modification and adjustment upon the happening of
certain events.
This Rights Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions
are hereby incorporated herein by reference and made a part hereof and to
which Rights Agreement reference is hereby made for a full description of the
rights, limitations of rights, obligations, duties and immunities hereunder
of the Rights Agent, the Company and the holders of the Rights Certificates,
which limitation of rights include the temporary suspension of the
exercisability of such Rights under the specific circumstances set forth in
the Rights Agreement. Copies of the Rights Agreement are on file at the
above-mentioned office of the Rights Agent and are also available upon
written request to the Rights Agent.
This Rights Certificate, with or without other Rights Certificates,
upon surrender at the office or offices the Rights Agent designated for such
purpose, may be exchanged for another Rights Certificate or Rights
Certificates of like tenor and date evidencing Rights entitling the holder to
purchase a like aggregate number of 1/1,000ths of a share of Preferred Stock
as the Rights evidenced by the Rights Certificate or Rights Certificates
surrendered shall have entitled such holder to purchase. If this Rights
Certificate shall be exercised in part, the holder shall be entitled to
receive upon surrender hereof another Rights Certificate or Rights
Certificates for the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced
by this Certificate may be redeemed by the Company at its options at a
redemption price of $0.0005 per Right.
No fractional shares of Preferred Stock will be issued upon the
exercise of any Right or Rights evidenced hereby (other than fractions which
are integral multiples of 1/1,000ths of a share of Preferred Stock), but in
lieu thereof a cash payment will be made, as provided in the Rights
Agreement.
No holder of this Rights Certificate shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of Preferred Stock
or of any other securities of the Company which may at any time be issuable
on the exercise hereof, nor shall anything contained in the Rights Agreement
or herein be construed to confer upon the holder hereof, as such, any of the
rights of a stockholder of the Company or any right to vote for the election
of directors or upon any matter submitted to stockholders at any meeting
thereof, or to give or withhold consent to any corporate action, or, to
receive notice of meetings or other action affecting stockholders (except as
provided in the Rights Agreement), or to receive dividends or subscription
rights, or otherwise, until the Right or Right evidenced by this Rights
Certificate shall have been exercised as provided in the Rights Agreement.
This Rights Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the Company
and its corporate seal. Dated as of this [______] day of [________________],
1999.
[SEAL] XXXXXXXX FINANCIAL, INC.
By:--------------------------------
Title: President
ATTEST:
-------------------------------
Title: Secretary
Countersigned:
[RIGHTS AGENT]
By:_____________________________
Authorized Signature
[Form of Reverse Side of Rights Certificate]
FORM OF ASSIGNMENT
------------------
(To be executed by the registered holder if such holder desires to
transfer the Rights Certificates.)
FOR VALUE RECEIVED ___________________________ hereby sells, assigns
and transfers unto ______________________________________________________
----------------------------------------------------------------------
(Please print name and address of transferee)
this Rights Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint _________________________
Attorney, to transfer the within Rights Certificate on the books of the
within-named Company, with full power of substitution.
Dated: ___________________________
-----------------------------------
Signature
Signature Guaranteed:
CERTIFICATE
-----------
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) this Rights Certificate [ ] is [ ] is not being sold, assigned and
transferred by or on behalf of a Person who is or was an Acquiring Person or
an Affiliate or Associate of any such Acquiring Person (as such terms are
defined pursuant to the Rights Agreement);
(2) after due inquiry and to the best knowledge of the undersigned,
the undersigned [ ] did [ ] did not acquire the Rights evidenced by this Rights
Certificate from any Person who is, was or subsequently became an Acquiring
Person or an Affiliate or Associate of an Acquiring Person.
Dated: ________________________
----------------------------------------
Signature
Signature Guaranteed:
NOTICE
------
The signature to the foregoing Assignment and Certificate must
correspond to the name as written upon the face of this Rights Certificate in
every particular, without alteration or enlargement or any change whatsoever.
FORM OF ELECTION TO PURCHASE
----------------------------
(To be executed if holder desires
to exercise Rights represented
by the Rights Certificate)
To:____________________________
The undersigned hereby irrevocably elects to exercise ______ Rights
represented by this Rights Certificate to purchase the shares of Preferred
Stock issuable upon the exercise of the Rights (or such other securities of
the Company or of any other person which may be issuable upon the exercise of
the Rights) and requests that certificates for such shares be issued in the
name of and delivered to:
Please insert social security
or other identifying number
---------------------------------------------------------------------------
(Please print name and address)
---------------------------------------------------------------------------
If such number of Rights shall not be all the Rights evidenced by this Rights
Certificate, a new Rights Certificate for the balance remaining of such
Rights shall be registered in the name of and delivered to:
Please insert social security
or other identifying number
---------------------------------------------------------------------------
(Please print name and address)
---------------------------------------------------------------------------
Dated:____________________, ________
---------------------------------------
Signature
Signature Guaranteed:
CERTIFICATE
-----------
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) the Rights evidenced by this Rights Certificate [ ] are [ ] are not
being exercised by or on behalf of a Person who is or was an Acquiring Person
or an Affiliate or Associate of any such Acquiring Person (as such terms are
defined pursuant to the Rights Agreement);
(2) after due inquiry and to the best knowledge of the undersigned,
the undersigned [ ] did [ ] did not acquire the Rights evidenced by this Rights
Certificate from any Person who is, was or became an Acquiring Person or an
Affiliate or Associate of an Acquiring Person.
Dated:_________________, 1999
----------------------------------
Signature
Signature Guaranteed:
NOTICE
------
The signature to the foregoing Election to Purchase and Certificate
must correspond to the name as written upon the face of this Rights
Certificate in every particular, without alteration or enlargement or any
change whatsoever.
EXHIBIT C
DETAILED SUMMARY OF RIGHTS TO PURCHASE
SERIES A PREFERRED STOCK
On _____________ 1999, the Board of Directors of Xxxxxxxx Financial,
Inc. (the "Company") declared a dividend distribution of one Right for each
outstanding share of the Company's Common Stock, $0.01 par value per share
(the "Common Stock"), of the Company to the stockholders of record on
_______________, 1999, (the "Record Date"). Each Right entitles the
registered holder to purchase from the Company 1/1,000ths of a share of
Series A Preferred Stock the ("Preferred Stock") or in some circumstances,
Common Stock, other securities, cash or other assets as summarized below at a
price of $_______ per share (the "Purchase Price"), (both shares and price
are subject to adjustment as described below). The complete terms and
conditions of the Rights are set forth in a Rights Agreement (the "Rights
Agreement") between the Company and __________________________, dated as of
_______________, 1999, as may be amended from time to time. Capitalized
terms not defined herein are defined in the Rights Agreement.
Each share outstanding on the Record Date will receive one Right.
Until the Distribution Date (or the earlier redemption or expiration of the
Rights), shares of Common Stock issued (whether newly issued or from
treasury) will have the Rights automatically attached. Following the
Distribution Date, shares of Common Stock issued will be accompanied by
Rights only in certain instances.
In the event that a Person or group of affiliated or associated persons
(an "Acquiring Person") becomes the beneficial owner of or announces a tender
or exchange offer for 15 percent or more of the outstanding shares of Common
Stock of the Company, proper provision shall be made so that each holder of a
Right, other than of Rights that are or were beneficially owned by the
Acquiring Person (which will thereafter be null and void), will thereafter
have the right to receive upon exercise that number of shares of the
Preferred Stock (or in certain circumstances, Common Stock or assets or other
securities of the Company) having a market value of two times the exercise
price of the Right. In the event that the Company were acquired in a merger
or other business combination transaction (other than pursuant to a Permitted
Offer) or more than 50 percent of the Company's (together with its
subsidiaries) assets or earning power were sold, proper provision shall be
made so that each holder of a Right, other than of Rights that are or were
beneficially owned by an Acquiring Person (which will thereafter be null and
void) shall thereafter have the right to receive, upon the exercise thereof
at the then current exercise price of the Right, that number of shares of the
highest priority voting securities of the acquiring company (or certain of
its affiliates) that at the time of such transaction would have a market
value of two times the exercise price of the Right. If the Rights are
exercised to acquire the Preferred Stock, then the Rights will not be
exercisable to acquire the securities of any Acquiring Person.
Until ten calendar days following the earlier to occur of (unless
extended by the Board of Directors and subject to the earlier redemption or
expiration of the Rights): (i) the date of a public announcement that an
Acquiring Person acquired, or obtained the right to acquire, beneficial
ownership of 15 percent or more of the outstanding shares of the Common Stock
of the Company, or (ii) the commencement or announcement of an intention to
make a tender offer or exchange offer that would result in an Acquiring
Person beneficially owning 15 percent or more of such outstanding shares of
Common Stock of the Company (the earlier of such dates being called the
"Distribution Date"), the Rights will be evidenced, with respect to any of
the Company's Common Stock certificates outstanding as of the Record Date, by
such Common Stock certificate. The certificates for shares of Common Stock
issued after the Record Date, but prior to the Distribution Date will have a
notation referencing the Rights Agreement. The Rights Agreement provides
that, until the Distribution Date, the Rights will be transferred with and
only with the Company's Common Stock, and until the Distribution Date (or
earlier redemption or expiration of the Rights), the surrender for transfer
of any of the Company's Common Stock certificates outstanding as of the
Record Date, 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
("Rights Certificates") will be mailed to holders of record of the Company's
Common Stock as of the close of business on the Distribution Date and such
separate Rights Certificates alone will evidence the Rights.
Permitted Offer is defined in the Rights Agreement as a tender offer
that is for all outstanding Common Stock of the Company at a price and on
terms determined to be adequate prior to the purchase of shares under such
tender or exchange offer, by at least 70% of the members of the Board of
Directors of the Company, taking into account all factors that such directors
deem relevant including, without limitation, prices that could reasonably be
achieved if the Company or its assets were sold on an orderly basis designed
to realize maximum value and otherwise in the best interests of the Company
and its stockholders (other than the Person or any Affiliate or Associate
thereof for whose benefit the offer is being made).
The Purchase Price payable, and the number of shares of Preferred Stock
(or Common Stock, other securities, cash or other assets, as the case may be)
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 Stock, (ii)
upon the grant to holders of the Preferred Stock of certain rights or
warrants to subscribe for shares of the Preferred Stock or convertible
securities at less than the current market price of the Preferred Stock or
(iii) upon the distribution to holders of the Preferred Stock of evidences of
indebtedness or assets (excluding regular periodic cash dividends out of
earnings or retained earnings or dividends payable in the Preferred Stock) or
of subscription rights or warrants (other than those referred to above).
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1
percent in such Purchase Price. No fractional shares will be issued (other
than fractional shares which are integral multiples of 1/1,000ths of a share
of Preferred Stock) and, in lieu thereof, an adjustment in cash will be made
based on the market price of the Preferred Stock on the last Trading Date
prior to the date of exercise.
The Rights are not exercisable until the Distribution Date. The Rights
will expire on ________________, unless earlier redeemed by the Company as
described below.
At any time prior to 5:00 p.m. New York, New York time on the tenth
calendar day after the first date after the public announcement that an
Acquiring Person has acquired beneficial ownership of 15 percent or more of
the outstanding shares of the Common Stock of the Company (the "Share
Acquisition Date"), the Company may redeem the Rights in whole, but not in
part, at a price of $0.0005 per Right (the "Redemption Price"). Following the
Share Acquisition Date, but prior to an event listed in Section 13(a) of the
Rights Agreement (i.e. a merger, consolidation or sale of more than 50
percent of the assets or earnings power of the Company and its subsidiaries),
the Company may redeem the Rights in connection with any event specified in
Section 13(a) in which all stockholders are treated alike and which does not
include the Acquiring Person or its Affiliates or Associates. In addition,
the Company's right of redemption may be reinstated following an inadvertent
trigger of the Rights (as determined by the Board) if an Acquiring Person
reduces its beneficial ownership to 10 percent or less of the outstanding
shares of Common Stock of the Company in a transaction or series of
transactions not involving the Company. Immediately upon the action of the
Board of Directors of the Company electing to redeem the Rights, the Company
shall make announcement thereof, and upon such election, the right to
exercise the Rights will terminate and the only right of the holders of
Rights will be to receive the Redemption Price.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Company, including, without limitation, the
right to vote or to receive dividends. While the distribution of the Rights
will not be taxable to stockholders of the Company, stockholders may,
depending on the circumstances, recognize taxable income in the event that
the Rights become exercisable for the Preferred Stock (or other securities,
as the case may be) of the Company.
Prior to the Distribution Date the Company may amend or supplement any
provision of the Rights Agreement without the consent of the holders of the
Rights. Following the Distribution Date, the Company may amend the
provisions of the Rights Agreement in order to cure any ambiguity, to correct
any defect or inconsistency, to make changes deemed necessary or desirable so
long as such changes do not adversely affect the interests of the holders of
the Rights (excluding the interests of any Acquiring Person and its
affiliates and associates). In either case, however, the Company may not
amend or supplement the Rights Agreement to change or supplement the
Redemption Price, Final Expiration Date, the Purchase Price or the number of
1/1,000ths of a share of Preferred Stock for which a Right is exercisable.
The Rights may have the effect of impeding a change in control of the
Company without the prior consent of the Company's Board of Directors, and
the Rights could cause substantial dilution to a person that attempts to
acquire the Company without conditioning the offer on redemption of the Rights
by the Company's Board of Directors or on the acquisition by such person of a
substantial number of Rights.
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to a Registration Statement on Form 10
dated ___________, 1999. A copy of the Rights Agreement is available free of
charge from the Company by written request to Xxxxxxxxx Financial, Inc., 000
Xxxx 00xx Xxxxxx, Xxxxxx Xxxx, Xxxxxxxx 00000. 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. In the event of a conflict between this summary and the Rights
Agreement, the Rights Agreement will prevail.
