THIRD AMENDMENT TO
RIGHTS AGREEMENT
THIS THIRD AMENDMENT (this "Third Amendment"), dated as of September 4,
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2003, is between XXXX SYSTEMS, Inc., a Delaware corporation (the "Company"), and
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REGISTRAR AND TRANSFER COMPANY, as Rights Agent (the "Rights Agent").
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WHEREAS, the Company and the Rights Agent are parties to a Rights Agreement
dated as of September 4, 1998, as amended as of July 6, 2001, and as amended
pursuant to that certain Amendment to Rights Agreement dated August 10, 2001,
appointing Rights Agent as successor rights agent to BankBoston, N.A. (such
agreement, as amended, the "Rights Agreement");
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WHEREAS, chinadotcom corporation, a Cayman Islands company ("Parent"), CDC
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Software Holdings, Inc., a Delaware corporation ("Merger Sub") and a
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wholly-owned subsidiary of Parent, and the Company propose to enter into an
Agreement and Plan of Merger pursuant to which (subject to the terms and
conditions set forth therein) Merger Sub will be merged with and into the
Company; and
WHEREAS, pursuant to Section 27 of the Rights Agreement, the Board of
Directors of the Company has determined that an amendment to the Rights
Agreement as set forth herein is necessary and desirable to reflect the
foregoing and certain other matters, and the Company and the Rights Agent desire
to evidence such amendment in writing.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein set forth, the parties hereto agree as follows:
1. Amendment of Section 1(a). The first sentence of Section 1(a) of the
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Rights Agreement is hereby deleted in its entirety and replaced by the following
sentence:
(a) "Acquiring Person" shall mean any Person who or which, together
with all Affiliates and Associates of such Person, shall be the Beneficial
Owner of 15% or more of the Company's Common Shares then outstanding, but
shall not include the Company, any Subsidiary of the Company or any
employee benefit plan of the Company or of any Subsidiary of the Company,
or any entity holding Common Shares for or pursuant to the terms of any
such plan; provided, however, that Xxxxxxxx X. Xxxxxxxx, III or any entity
wholly-owned by Xxxxxxxx X. Xxxxxxxx, III (collectively, "Xxxxxxxx") shall
not be deemed an "Acquiring Person" until such time as Xxxxxxxx shall be
the Beneficial Owner of more than 21% of the Company's Common Shares then
outstanding or until such time as Xxxxxxxx announces a tender offer to
acquire more than 21% of the Company's outstanding Common Shares
(collectively, the "Limitations").
2. Amendment of Section 1. Section 1 of the Rights Agreement is amended by
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inserting the following as a new paragraph at the end of Section 1:
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"In addition, notwithstanding anything in this Agreement to the
contrary, (i) neither chinadotcom corporation, a Cayman Islands company
("Parent"), CDC Software Holdings, Inc., a Delaware corporation ("Merger
Sub"), a wholly-owned subsidiary of Parent, nor any Affiliate or Associate
of Parent or Merger Sub, shall be deemed to be an Acquiring Person by
virtue of the execution of the Agreement and Plan of Merger, to be entered
into on or about September 4, 2003, by and between Parent, Merger Sub and
the Company, as it may be amended or supplemented from time to time in
accordance with its terms (the "Merger Agreement"), by virtue of the
execution of any of the Stockholder Agreements (as defined in the Merger
Agreement) or the Preferred Stockholder Agreement (as defined in the Merger
Agreement), or by virtue of any of the transactions contemplated by the
Merger Agreement, the Stockholder Agreements or the Preferred Stockholder
Agreement, and (ii) no Shares Acquisition Date, Distribution Date or
Triggering Event shall be deemed to occur by virtue of the execution of the
Merger Agreement, any of the Stockholder Agreements or the Preferred
Stockholder Agreement, or by virtue of any of the transactions contemplated
by the Merger Agreement, the Stockholder Agreements or the Preferred
Stockholder Agreement, including, without limitation, the publication or
other announcement of the signing of the Merger Agreement, the Stockholder
Agreements or the Preferred Stockholder Agreement or the consummation of
the Merger (as defined in the Merger Agreement)."
3. Amendment of Section 1(q). Section 1(q) of the Rights Agreement is
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deleted in its entirety and replaced by the following Section 1(q):
(q) "Expiration Date" shall mean the earliest to occur of: (i) the
Close of Business on the Final Expiration Date, (ii) the Redemption Date,
(iii) the time at which the Board of Directors orders the exchange of
Rights as provided in Section 24 hereof, or (iv) notwithstanding anything
to the contrary in this Agreement, the time immediately prior to the
Effective Time (as defined in the Merger Agreement)."
4. Amendment of Section 13. Section 13 of the Rights Agreement is amended
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by inserting the following sentence at the end of such Section:
"Notwithstanding the foregoing, this Section 13 shall not apply to the
Merger or as a result of the execution and delivery of the Merger
Agreement, the Stockholder Agreements or the Preferred Stockholder
Agreement or any of the transactions contemplated by the Merger Agreement,
the Stockholder Agreements or the Preferred Stockholder Agreement,
including, without limitation, the publication or other announcement of the
signing of the Merger Agreement, the Stockholder Agreements or the
Preferred Stockholder Agreement or the consummation of the Merger (as
defined in the Merger Agreement)."
5. Effectiveness. This Third Amendment shall be deemed effective as of
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September 4, 2003, as if executed on such date. Except as expressly amended
hereby, all of the terms and provisions of the Rights Agreement are and shall
remain in full force and effect and shall be otherwise unaffected by this Third
Amendment.
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6. Governing Law. This Third Amendment shall be deemed to be a contract
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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.
7. Counterparts. This Third Amendment may be executed in any number of
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counterparts, each of such counterparts shall for all purposes be deemed to be
an original, and all such counterparts shall together constitute one and the
same instrument.
8. Severability. If any term, provision, covenant or restriction of this
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Third Amendment 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 Third Amendment shall remain in full force
and effect and shall in no way be affected, impaired or invalidated.
IN WITNESS WHEREOF, the parties hereto have caused this Third Amendment to
the Rights Agreement to be duly executed as of the date first above written.
XXXX SYSTEMS, INC.
/s/ J. Xxxxxxx Xxxxxx
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Name: J. Xxxxxxx Xxxxxx
Title: Chief Executive Officer
REGISTRAR AND TRANSFER COMPANY
/s/ Xxxxxxx X. Tatler
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Name: Xxxxxxx X. Tatler
Title: Vice President
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