AMENDED AND RESTATED STOCKHOLDER PROTECTION RIGHTS AGREEMENT dated as of June 22, 2006 between WILSHIRE ENTERPRISES, INC. and CONTINENTAL STOCK TRANSFER & TRUST COMPANY, as Rights Agent
AMENDED
AND RESTATED
dated
as of
June
22, 2006
between
WILSHIRE
ENTERPRISES, INC.
and
CONTINENTAL
STOCK TRANSFER & TRUST COMPANY,
as
Rights Agent
TABLE
OF CONTENTS
Page
Article
I
CERTAIN
DEFINITIONS
|
Section
1.1
|
Certain
Definitions
|
2
|
Article
II
THE
RIGHTS
|
Section
2.1
|
Summary
of Rights
|
6
|
|
Section
2.2
|
Legend
on Common Stock Certificates
|
7
|
|
Section
2.3
|
Exercise
of Rights; Separation of Rights
|
7
|
|
Section
2.4
|
Adjustments
to Exercise Price; Number of Rights
|
9
|
|
Section
2.5
|
Date
on Which Exercise is Effective
|
10
|
|
Section
2.6
|
Execution,
Authentication, Delivery and Dating of Rights Certificates
|
10
|
|
Section
2.7
|
Registration,
Registration of Transfer and Exchange
|
11
|
|
Section
2.8
|
Mutilated,
Destroyed, Lost and Stolen Rights Certificates
|
11
|
|
Section
2.9
|
Persons
Deemed Owners
|
12
|
|
Section
2.10
|
Delivery
and Cancellation of Certificates
|
12
|
|
Section
2.11
|
Agreement
of Rights Holders
|
12
|
Article
III
ADJUSTMENTS
TO THE RIGHTS IN THE EVENT OF
CERTAIN
TRANSACTIONS
|
Section
3.1
|
Flip-in
|
13
|
|
Section
3.2
|
Flip-over
|
15
|
Article
IV
THE
RIGHTS AGENT
|
Section
4.1
|
General
|
16
|
|
Section
4.2
|
Merger
or Consolidation or Change of Name of Rights Agent
|
16
|
|
Section
4.3
|
Duties
of Rights Agent
|
17
|
|
Section
4.4
|
Change
of Rights Agent
|
18
|
Article
V
MISCELLANEOUS
|
Section
5.1
|
Redemption
|
19
|
|
Section
5.2
|
Expiration
|
19
|
|
Section
5.3
|
Issuance
of New Rights Certificates
|
19
|
|
Section
5.4
|
Supplements
and Amendments
|
00
|
-x-
|
Xxxxxxx
5.5
|
Fractional
Shares
|
20
|
|
Section
5.6
|
Rights
of Action
|
20
|
|
Section
5.7
|
Holder
of Rights Not Deemed a Stockholder
|
21
|
|
Section
5.8
|
Notice
of Proposed Actions
|
21
|
|
Section
5.9
|
Notices
|
21
|
|
Section
5.10
|
Suspension
of Exercisability
|
22
|
|
Section
5.11
|
Costs
of Enforcement
|
22
|
|
Section
5.12
|
Successors
|
22
|
|
Section
5.13
|
Benefits
of this Agreement
|
22
|
|
Section
5.14
|
Determination
and Actions by the Board of Directors, etc.
|
22
|
|
Section
5.15
|
Descriptive
Headings
|
23
|
|
Section
5.16
|
Governing
Law
|
23
|
|
Section
5.17
|
Counterparts
|
23
|
|
Section
5.18
|
Severability
|
23
|
EXHIBITS
|
Exhibit
A
|
Form
of Rights Certificate (Together with Form of Election to
Exercise)
|
|
Exhibit
B
|
Form
of Certificate of Designations and Terms of Series A Participating
Preferred Stock of Wilshire Enterprises,
Inc.
|
-ii-
AMENDED
AND RESTATED
AMENDED
AND RESTATED STOCKHOLDER PROTECTION RIGHTS AGREEMENT (as it may be amended
from
time to time, this “Agreement”), dated as of June 22, 2006, between WILSHIRE
ENTERPRISES, INC., a Delaware corporation (the “Company”), and Continental Stock
Transfer & Trust Company, a limited purpose trust company organized under
the banking laws of the State of New York, as Rights Agent (the “Rights Agent”,
which term shall include any successor Rights Agent hereunder).
WITNESSETH
:
WHEREAS,
the Board of Directors of the Company previously (a) authorized and declared
a
dividend of one right (“Right”) in respect of each share of Common Stock (as
hereinafter defined) held of record as of July 6, 1996 (the “Record Time”) and
(b) as provided in Section 2.4, authorized the issuance of one Right in respect
of each share of Common Stock issued after the Record Time and prior to the
Separation Time (as hereinafter defined) and, to the extent provided in Section
5.3, each share of Common Stock issued after the Separation Time;
WHEREAS,
each Right entitles the holder thereof, after the Separation Time, to purchase
securities of the Company (or, in certain cases, of certain other entities)
pursuant to the terms and subject to the terms and conditions set forth herein;
WHEREAS,
the Company previously appointed the Rights Agent to act on behalf of the
Company, and the Rights Agent is willing so to act, in connection with the
issuance, transfer, exchange, replacement and redemption of Rights Certificates
(as hereinafter defined), the exercise of Rights and other matters referred
to
herein;
WHEREAS,
the Company entered into a Stockholder Protection Rights Agreement with the
Rights Agent dated as of June 21, 1996 to govern the administration of the
Rights (the “Prior Agreement”);
WHEREAS,
the Prior Agreement would have expired on July 6, 2006; and
WHEREAS,
the Board of Directors of the Company has determined that it is in the best
interests of the Company and its stockholders to extend the term of the Prior
Agreement as described herein;
NOW
THEREFORE, in consideration of the premises and the respective agreements set
forth herein, the parties hereby agree that the Prior Agreement is hereby
amended and restated in its entirety to provide as follows:
ARTICLE
I
CERTAIN
DEFINITIONS
1.1 Certain
Definitions.
For
purposes of this Agreement, the following terms have the meanings indicated:
“Acquiring
Person” shall mean any Person who is a Beneficial Owner of 15% or more of the
outstanding shares of Common Stock; provided, however, that the term “Acquiring
Person” shall not include any Person (i) who was the Beneficial Owner of 10% or
more of the outstanding shares of Common Stock as of June 21, 1996 as long
as
such Person does not become the Beneficial Owner of 25% or more of the
outstanding shares of Common Stock or who shall become the Beneficial Owner
of
15% or more, or, in the case of a Person who was the Beneficial Owner of 10%
or
more of the outstanding shares of Common Stock as of June 21, 1996, 25% or
more,
of the outstanding shares of Common Stock solely as a result of an acquisition
by the Company of shares of Common Stock, until such time hereafter or
thereafter as any of such Persons shall become the Beneficial Owner (other
than
by means of a stock dividend or stock split) of any additional shares of Common
Stock, (ii) who is the Beneficial Owner of 15% or more of the outstanding shares
of Common Stock but who (as determined by the Company’s Board of Directors in
good faith) acquired Beneficial Ownership of shares of Common Stock without
any
plan or intention to seek or affect control of the Company, unless and until
such Person shall have failed to divest itself, as soon as practicable (as
determined by the Company’s Board of Directors in good faith), of Beneficial
Ownership of a sufficient number of shares of Common Stock so that such Person
would no longer otherwise qualify as an “Acquiring Person” or (iii) who
Beneficially Owns shares of Common Stock consisting solely of one or more of
(A)
shares of Common Stock Beneficially Owned pursuant to the grant or exercise
of
an option granted to such Person (an “Option Holder”) by the Company in
connection with an agreement to merge with, or acquire, the Company entered
into
prior to a Flip-in Date, (B) shares of Common Stock (or securities convertible
into, exchangeable into or exercisable for Common Stock), Beneficially Owned
by
such Option Holder or its Affiliates or Associates at the time of the grant
of
such option or (C) shares of Common Stock (or securities convertible into,
exchangeable into or exercisable for Common Stock) acquired by Affiliates or
Associates of such Option Holder after the time of such grant which, in the
aggregate, amount to less than 1% of the outstanding shares of Common Stock.
In
addition, the Company, any wholly-owned Subsidiary of the Company and any
employee stock ownership or other employee benefit plan of the Company or a
wholly-owned Subsidiary of the Company shall not be an Acquiring Person.
“Affiliate”
and “Associate” shall have the respective meanings ascribed to such terms in
Rule 12b-2 under the Exchange Act, as such Rule was in effect on June 21, 1996.
A
Person
shall be deemed the “Beneficial Owner”, and to have “Beneficial Ownership” of,
and to “Beneficially Own”, any securities as to which such Person or any of such
Person’s Affiliates or Associates is or may be deemed to be the beneficial owner
of pursuant to Rule 13d-3 and 13d-5 under the Exchange Act, as such Rules were
in effect on June 21, 1996 as well as any securities as to which such Person
or
any of such Person’s Affiliates or Associates has the right to become Beneficial
Owner (whether such right is exercisable immediately or only after the passage
of time or the occurrence of conditions) pursuant to any agreement, arrangement
or understanding, or upon the exercise of conversion rights, exchange rights,
rights (other than the Rights), warrants or options, or otherwise; provided,
however, that a Person shall not be deemed the “Beneficial Owner”, or to have
“Beneficial Ownership” of, or to “Beneficially Own”, any security (i) solely
because such security has been tendered pursuant to a tender or exchange offer
made by such Person or any of such Person’s Affiliates or Associates until such
tendered security is accepted for payment or exchange or (ii) solely because
such Person or any of such Person’s Affiliates or Associates has or shares the
power to vote or direct the voting of such security pursuant to a revocable
proxy given in response to a public proxy or consent solicitation made to more
than ten holders of shares of a class of stock of the Company registered under
Section 12 of the Exchange Act and pursuant to, and in accordance with, the
applicable rules and regulations under the Exchange Act, except if such power
(or the arrangements relating thereto) is then reportable under Item 6 of
Schedule 13D under the Exchange Act. Notwithstanding the foregoing, no officer
or director of the Company shall be deemed to Beneficially Own any securities
of
any other Person by virtue of any actions such officer or director takes in
such
capacity. For purposes of this Agreement, in determining the percentage of
the
outstanding shares of Common Stock with respect to which a Person is the
Beneficial Owner, all shares as to which such Person is deemed the Beneficial
Owner shall be deemed outstanding.
-2-
“Business
Day” shall mean any day other than a Saturday, Sunday or a day on which banking
institutions in the City of New York are generally authorized or obligated
by
law or executive order to close.
“Close
of
business” on any given date shall mean 5:00 p.m. New York City time on such date
or, if such date is not a Business Day, 5:00 p.m. New York City time on the
next
succeeding Business Day.
“Common
Stock” shall mean the shares of common stock, par value $1.00 per share, of the
Company.
“Control”
shall have the meaning set forth in the definition of “Flip-over Transaction or
Event” set forth in this Section 1.1.
“Election
to Exercise” shall have the meaning set forth in Section 2.3(d) hereof.
“Exchange
Act” shall mean the Securities Exchange Act of 1934 as amended from time to time
or any federal statute from time to time in effect that has replaced such
statute. Any reference in this Agreement to a provision of the Exchange Act
or a
rule or regulation promulgated thereunder shall mean, unless otherwise
specified, such provision, rule or regulation as amended from time to time
or
any provision of a federal law, or any federal rule or regulation from time
to
time in effect that has replaced such provision, rule or regulation.
“Exchange
Ratio” shall have the meaning set forth in Section 3.1(c) hereof.
“Exchange
Time” shall mean the time at which the right to exercise the Rights shall
terminate pursuant to Section 3.1(c) hereof.
-3-
“Exercise
Price” shall mean, as of any date, the price at which a holder may purchase the
securities issuable upon exercise of one whole Right. Until adjustment thereof
in accordance with the terms hereof, the Exercise Price shall equal $25.00.
“Expansion
Factor” shall have the meaning set forth in Section 2.4(a) hereof.
“Expiration
Time” shall mean the earliest of (i) the Exchange Time, (ii) the Redemption
Time, (iii) the effective time of a consolidation, merger or share exchange
(each a “Business Combination”) of the Company into another entity pursuant to
an agreement entered into prior to a Flip-in Date, (iv) the close of business
on
August 31, 2007, unless the Independent Directors determine at a meeting to
be
held within 30 days prior to August 31, 2007, that this Agreement continues
to
be in the best interests of the Company and its stockholders, (v) the close
of
business on August 31, 2008, unless the stockholders of the Company approve
this
Agreement at the Company’s 2008 annual meeting of stockholders and (vi) the
close of business on August 31, 2010.
“Flip-in
Date” shall mean the first date that an Acquiring Person has become such.
“Flip-over
Entity,” for purposes of Section 3.2, shall mean (i) in the case of a Flip-over
Transaction or Event described in clause (i) of the definition thereof, the
Person issuing any securities into which shares of Common Stock are being
converted or exchanged and, if no such securities are being issued, the other
party to such Flip-over Transaction or Event and (ii) in the case of a Flip-over
Transaction or Event referred to in clause (ii) of the definition thereof,
the
Person receiving the greatest portion of the assets or earning power being
transferred in such Flip-over Transaction or Event, provided in all cases if
such Person is a Subsidiary of a corporation, the ultimate parent corporation
shall be the Flip-over Entity.
“Flip-over
Stock” shall mean the capital stock (or similar equity interest) with the
greatest voting power in respect of the election of directors (or other persons
similarly responsible for direction of the business and affairs) of the
Flip-Over Entity.
“Flip-over
Transaction or Event” shall mean a transaction or series of transactions after a
Flip-in Date in which, directly or indirectly, (i) the Company shall consolidate
or merge or participate in a binding share exchange with any other Person if,
at
the time of the consolidation, merger or share exchange or at the time the
Company enters into any agreement with respect to any such consolidation, merger
or share exchange, the Acquiring Person Controls the Board of Directors of
the
Company and either (A) any term of any agreement or arrangement concerning
the
treatment of shares of capital stock in such consolidation, merger or share
exchange relating to the Acquiring Person is not identical to the terms and
arrangements relating to other holders of the Common Stock or (B) the Person
with whom the transaction or series of transactions occurs is the Acquiring
Person or an Affiliate or Associate of an Acquiring Person or (ii) the Company
shall sell or otherwise transfer (or one or more of its Subsidiaries shall
sell
or otherwise transfer) assets (A) aggregating more than 50% of the assets
(measured by either book value or fair market value) or (B) generating more
than
50% of the operating income or cash flow, of the Company and its Subsidiaries
taken as a whole to any Person (other than the Company or one or more of its
wholly owned Subsidiaries) or to two or more such Persons which are Affiliates
or Associates or otherwise acting in concert, if, at the time of the entry
by
the Company (or any such Subsidiary) into an agreement with respect to such
sale
or transfer of assets, the Acquiring Person controls the Board of Directors
of
the Company. An Acquiring Person shall be deemed to “Control” the Company’s
Board of Directors when, following a Flip-in Date, the Persons who were
directors of the Company before the Flip-in Date shall cease to constitute
a
majority of the Company’s Board of Directors.
-4-
“holder”
shall have the meaning set forth in Section 2.9 hereof.
“Independent
Directors” shall mean those members of the Board of Directors of the Company who
constitute “independent directors” as defined in the American Stock Exchange’s
Corporate Governance Rules as in effect from time to time.
“Market
Price” per share of any securities on any date shall mean the average of the
daily closing prices per share of such securities (determined as described
below) on each of the 20 consecutive Trading Days through and including the
Trading Day immediately preceding such date; provided, however, that if an
event
of a type analogous to any of the events described in Section 2.4 hereof shall
have caused the closing prices used to determine the Market Price on any Trading
Days during such period of 20 Trading Days not to be fully comparable with
the
closing price on such date, each such closing price so used shall be
appropriately adjusted in order to make it fully comparable with the closing
price on such date. The closing price per share of any securities on any date
shall be the last reported sale price, regular way, or, in case no such sale
takes place or is quoted on such date, the average of the closing bid and ask
prices, regular way, for each share of such securities, in either case as
reported in the principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on the American Stock Exchange,
or,
if the securities are not listed or admitted to trading on the American Stock
Exchange, as reported in the principal consolidated transaction reporting system
with respect to securities listed on the principal national securities exchange
on which the securities are listed or admitted to trading or, if the securities
are not listed or admitted to trading on any national securities exchange,
as
reported by the National Association of Securities Dealers Automated Quotation
System or such other system then in use, or, if on any such date the securities
are not listed or admitted to trading on any national securities exchange or
quoted by any such organization, the average of the closing bid and ask prices
as furnished by a professional market maker making a market in the securities
selected by the Board of Directors of the Company; provided, however, that
if on
any such date the securities are not listed or admitted to trading on a national
securities exchange or traded in the over-the-counter market, the closing price
per share of such securities on such date shall mean the fair value per share
of
such securities on such date as determined in good faith by the Board of
Directors of the Company, after consultation with a nationally recognized
investment banking firm, and set forth in a certificate delivered to the Rights
Agent.
“Person”
shall mean any individual, firm, partnership, association, group (as such term
is used in Rule 13d-5 under the Exchange Act, as such Rule was in effect on
June
21, 1996), company, corporation or other entity.
-5-
“Preferred
Stock” shall mean the series of Series A Participating Preferred Stock, par
value $1.00 per share, of the Company created by a Certificate of Designations
and Terms in substantially the form set forth in Exhibit B.
“Redemption
Price” shall mean an amount equal to one cent, $0.01.
“Redemption
Time” shall mean the time at which the right to exercise the Rights shall
terminate pursuant to Section 5.1 hereof.
“Rights
Certificate” shall have the meaning set forth in Section 2.3(c) hereof.
“Rights
Register” shall have the meaning set forth in Section 2.7(a) hereof.
“Separation
Time” shall mean the close of business on the earlier of (i) the tenth business
day (or such later date as the Board of Directors of the Company may from time
to time fix by resolution adopted prior to any Separation Time that would
otherwise have occurred) after the date on which any Person commences a tender
or exchange offer which, if consummated, would result in such Person’s becoming
an Acquiring Person and (ii) the Flip-in Date; provided that if any tender
or
exchange offer referred to in clause (i) of this paragraph is canceled,
terminated or otherwise withdrawn prior to the Separation Time without the
purchase of any shares of Common Stock pursuant thereto, such offer shall be
deemed, for purposes of this paragraph, never to have been made.
“Stock
Acquisition Date” shall mean the first date of public announcement by the
Company (by any means) that an Acquiring Person has become such.
“Subsidiary”
of any specified Person shall mean any corporation or other entity of which
a
majority of the voting power of the equity securities or a majority of the
equity interest is Beneficially Owned, directly or indirectly, by such Person.
“Trading
Day,” when used with respect to any securities, shall mean a day on which the
American Stock Exchange is open for the transaction of business or, if such
securities are not listed or admitted to trading on the American Stock Exchange,
a day on which the principal national securities exchange on which such
securities are listed or admitted to trading is open for the transaction of
business or, if such securities are not listed or admitted to trading on any
national securities exchange, a Business Day.
ARTICLE
II
THE
RIGHTS
2.1 Summary
of Rights.
As soon
as practicable after the Record Time, the Company mailed a letter summarizing
the terms of the Rights to each holder of record of Common Stock as of the
Record Time, at such holder’s address as shown by the records of the Company.
Rights shall be issued in respect of all shares of Common Stock issued or
disposed of (including, without limitation, upon disposition of Common Stock
out
of treasury stock or issuance or reissuance of Common Stock out of authorized
but unissued shares) after the Record Time but prior to the earlier of the
Separation Time or the Expiration Time. In the event that the Company purchases
or otherwise acquires Common Stock after the Record Time but prior to the
Separation Time, the Rights associated with such Common Stock shall be deemed
canceled and retired so that the Company shall not be entitled to exercise
any
Rights associated with the shares of Common Stock which are no longer
outstanding.
-6-
2.2 Legend
on Common Stock Certificates.
Certificates for the Common Stock issued after the Record Time but prior to
the
Separation Time shall evidence one Right for each share of Common Stock
represented thereby and shall have impressed on, printed on, written on or
otherwise affixed to them the following legend:
Until
the
Separation Time (as defined in the Rights Agreement referred to below), this
certificate also evidences and entitles the holder hereof to certain Rights
as
set forth in an Amended and Restated Rights Agreement, dated as of June 22,
2006
(as such may be amended from time to time, the “Rights Agreement”), between
Wilshire Enterprises, Inc. (the “Company”) and Continental Stock Transfer &
Trust Company, as Rights Agent, the terms of which are hereby incorporated
herein by reference and a copy of which is on file at the principal executive
offices of the Company. Under certain circumstances, as set forth in the Rights
Agreement, such Rights may be redeemed, may become exercisable for securities
or
assets of the Company or another entity, may be exchanged for shares of Common
Stock or other securities or assets of the Company, may expire, may become
void
(if they are “Beneficially Owned” by an “Acquiring Person” or an Affiliate or
Associate thereof, as such terms are defined in the Rights Agreement, or by
any
transferee of any of the foregoing) or may be evidenced by separate certificates
and may no longer be evidenced by this certificate.
The
Company will mail or arrange for the mailing of a copy of the Rights Agreement
to the holder of this certificate without charge within five days after the
receipt of a written request therefor.
Certificates
representing shares of Common Stock that are issued and outstanding at the
date
hereof shall evidence one Right for each share of Common Stock evidenced thereby
notwithstanding the absence of the foregoing legend.
2.3 Exercise
of Rights; Separation of Rights.
(a)
Subject to Sections 3.1, 5.1 and 5.10 and subject to adjustment as herein set
forth, each Right will entitle the holder thereof, after the Separation Time
and
prior to the Expiration Time, to purchase, for the Exercise Price, one
one-hundredth (1/100) of a share of Preferred Stock.
(b) Until
the
Separation Time, (i) no Right may be exercised and (ii) each Right will be
evidenced by the certificate for the associated share of Common Stock (together,
in the case of certificates issued prior to the Record Time, with the letter
mailed to the record holder thereof pursuant to Section 2.1) and will be
transferable only together with, and will be transferred by a transfer (whether
with or without such letter) of, such associated share of Common Stock.
-7-
(c) Subject
to the terms and conditions hereof, after the Separation Time and prior to
the
Expiration Time, the Rights (i) may be exercised and (ii) may be transferred
independently of shares of Common Stock. Promptly following the Separation
Time,
the Rights Agent will mail to each holder of record of Common Stock as of the
Separation Time (other than any Person whose Rights have become void pursuant
to
Section 3.1(b)), at such holder’s address as shown on the books and records of
the Company (the Company hereby agreeing to furnish copies of such records
to
the Rights Agent for this purpose), (x) a certificate (a “Rights Certificate”)
in substantially the form of Exhibit A hereto, appropriately completed,
representing the number of Rights held by such holder at the Separation Time
and
having such marks of identification or designation and such legends, summaries
or endorsements printed thereon as the Company may deem appropriate and as
shall
not be inconsistent with the provisions of this Agreement, or as may be required
to comply with any law or with any rule or regulation made pursuant thereto
or
with any rule or regulation of any national securities exchange or quotation
system on which the Rights may from time to time be listed or traded, or to
conform to usage, and (y) a disclosure statement describing the Rights.
(d) Subject
to the terms and conditions hereof, Rights may be exercised on any Business
Day
after the Separation Time and prior to the Expiration Time by submitting to
the
Rights Agent the Rights Certificate evidencing such Rights with an Election
to
Exercise (an “Election to Exercise”) substantially in the form attached to the
Rights Certificate duly completed, accompanied by payment in cash, or by
certified or official bank check or money order payable to the order of the
Company, of a sum equal to the Exercise Price multiplied by the number of Rights
being exercised and a sum sufficient to cover any transfer tax or charge which
may be payable in respect of any transfer involved in the transfer or delivery
of Rights Certificates or the issuance or delivery of certificates for shares
or
depositary receipts (or both) in a name other than that of the holder of the
Rights being exercised.
(e) Upon
receipt of a Rights Certificate, with an Election to Exercise accompanied by
payment as set forth in Section 2.3(d), and subject to the terms and conditions
hereof, the Rights Agent will thereupon promptly (i)(A) requisition from a
transfer agent stock certificates evidencing such number of shares or other
securities to be purchased (the Company hereby irrevocably authorizing its
transfer agents to comply with all such requisitions) and (B) if the Company
elects pursuant to Section 5.5 not to issue certificates representing fractional
shares, requisition from the depositary selected by the Company depositary
receipts representing the fractional shares to be purchased or requisition
from
the Company the amount of cash to be paid in lieu of fractional shares in
accordance with Section 5.5 and (ii) after receipt of such certificates,
depositary receipts and/or cash, deliver the same to or upon the order of the
registered holder of such Rights Certificate, registered (in the case of
certificates or depositary receipts) in such name or names as may be designated
by such holder.
(f) In
case
the holder of any Rights shall exercise less than all the Rights evidenced
by
such holder’s Rights Certificate, a new Rights Certificate evidencing the Rights
remaining unexercised will be issued by the Rights Agent to such holder or
to
such holder’s duly authorized assigns.
-8-
(g) The
Company covenants and agrees that it will (i) take all such action as may be
necessary to ensure that all shares delivered upon exercise of Rights shall,
at
the time of delivery of the certificates for such shares (subject to payment
of
the Exercise Price), be duly and validly authorized, executed, issued and
delivered and fully paid and nonassessable; (ii) take all such action as may
be
necessary to comply with any applicable requirements of the Securities Act
of
1933 or the Exchange Act, and the rules and regulations thereunder, and any
other applicable law, rule or regulation, in connection with the issuance of
any
shares upon exercise of Rights; and (iii) pay when due and payable any and
all
federal and state transfer taxes and charges which may be payable in respect
of
the original issuance or delivery of the Rights Certificates or of any shares
issued upon the exercise of Rights, provided, that the Company shall not be
required to pay any transfer tax or charge which may be payable in respect
of
any transfer involved in the transfer or delivery of Rights Certificates or
the
issuance or delivery of certificates for shares in a name other than that of
the
holder of the Rights being transferred or exercised.
2.4 Adjustments
to Exercise Price; Number of Rights.
(a) In
the event the Company shall at any time after the Record Time and prior to
the
Separation Time (i) declare or pay a dividend on Common Stock payable in Common
Stock, (ii) subdivide the outstanding Common Stock or (iii) combine the
outstanding Common Stock into a smaller number of shares of Common Stock, (x)
the Exercise Price in effect after such adjustment will be equal to the Exercise
Price in effect immediately prior to such adjustment divided by the number
of
shares of Common Stock (the “Expansion Factor”) that a holder of one share of
Common Stock immediately prior to such dividend, subdivision or combination
would hold thereafter as a result thereof and (y) each Right held prior to
such
adjustment will become that number of Rights equal to the Expansion Factor,
and
the adjusted number of Rights will be deemed to be distributed among the shares
of Common Stock with respect to which the original Rights were associated (if
they remain outstanding) and the shares issued in respect of such dividend,
subdivision or combination, so that each such share of Common Stock will have
exactly one Right associated with it. Each adjustment made pursuant to this
paragraph shall be made as of the payment or effective date for the applicable
dividend, subdivision or combination.
In
the
event the Company shall at any time after the Record Time and prior to the
Separation Time issue any shares of Common Stock otherwise than in a transaction
referred to in the preceding paragraph, each such share of Common Stock so
issued shall automatically have one new Right associated with it, which Right
shall be evidenced by the certificate representing such share. To the extent
provided in Section 5.3, Rights shall be issued by the Company in respect of
shares of Common Stock that are issued or sold by the Company after the
Separation Time.
(b) In
the
event the Company shall at any time after the Record Time and prior to the
Separation Time issue or distribute any securities or assets in respect of,
in
lieu of or in exchange for Common Stock (other than pursuant to a regular
periodic cash dividend or a dividend paid solely in Common Stock) whether by
dividend, in a reclassification or recapitalization (including any such
transaction involving a merger, consolidation or share exchange), or otherwise,
the Company shall make such adjustments, if any, in the Exercise Price, number
of Rights and/or securities or other property purchasable upon exercise of
Rights as the Board of Directors of the Company, in its sole discretion, may
deem to be appropriate under the circumstances in order to adequately protect
the interests of the holders of Rights generally, and the Company and the Rights
Agent shall amend this Agreement as necessary to provide for such adjustments.
-9-
(c) Each
adjustment to the Exercise Price made pursuant to this Section 2.4 shall be
calculated to the nearest whole cent. Whenever an adjustment to the Exercise
Price is made pursuant to this Section 2.4, the Company shall (i) promptly
prepare a certificate setting forth such adjustment and a brief statement of
the
facts accounting for such adjustment and (ii) promptly file with the Rights
Agent and with each transfer agent for the Common Stock a copy of such
certificate.
(d) Rights
Certificates shall represent the securities purchasable under the terms of
this
Agreement, including any adjustment or change in the securities purchasable
upon
exercise of the Rights, even though such certificates may continue to express
the securities purchasable at the time of issuance of the initial Rights
Certificates.
2.5 Date
on Which Exercise is Effective.
Each
person in whose name any certificate for securities is issued upon the exercise
of Rights shall for all purposes be deemed to have become the holder of record
of the securities represented thereby on, and such certificate shall be dated,
the date upon which the Rights Certificate evidencing such Rights was duly
surrendered and payment of the Exercise Price for such Rights (and any
applicable taxes and other governmental charges payable by the exercising holder
hereunder) was made; provided, however, that if the date of such surrender
and
payment is a date upon which the stock transfer books of the Company are closed,
such person shall be deemed to have become the record holder of such securities
on, and such certificate shall be dated, the next succeeding Business Day on
which the stock transfer books of the Company are open.
2.6 Execution,
Authentication, Delivery and Dating of Rights Certificates.
(a) The Rights Certificates shall be executed on behalf of the
Company by its Chairman of the Board, President, Treasurer or one of its Vice
Presidents, under its corporate seal reproduced thereon attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Rights Certificates may be manual or facsimile.
Rights
Certificates bearing the manual or facsimile signatures of individuals who
were
at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the countersignature and delivery of such Rights Certificates.
Promptly
after the Separation Time, the Company will notify the Rights Agent of such
Separation Time and will deliver Rights Certificates executed by the Company
to
the Rights Agent for countersignature, and, subject to Section 3.1(b), the
Rights Agent shall manually countersign and deliver such Rights Certificates
to
the holders of the Rights pursuant to Section 2.3(c) hereof. No Rights
Certificate shall be valid for any purpose unless manually countersigned by
the
Rights Agent.
-10-
(b) Each
Rights Certificate shall be dated the date of countersignature thereof.
2.7 Registration,
Registration of Transfer and Exchange.
(a)
After the Separation Time, the Company will cause to be kept a register (the
“Rights Register”) in which, subject to such reasonable regulations as it may
prescribe, the Company will provide for the registration and transfer of Rights.
The Rights Agent is hereby appointed “Rights Registrar” for the purpose of
maintaining the Rights Register for the Company and registering Rights and
transfers of Rights after the Separation Time as herein provided. In the event
that the Rights Agent shall cease to be the Rights Registrar, the Rights Agent
will have the right to examine the Rights Register at all reasonable times
after
the Separation Time.
After
the
Separation Time and prior to the Expiration Time, upon surrender for
registration of transfer or exchange of any Rights Certificate, and subject to
the provisions of Section 2.7(c) and (d), the Company will execute, and the
Rights Agent will countersign and deliver, in the name of the holder or the
designated transferee or transferees, as required pursuant to the holder’s
instructions, one or more new Rights Certificates evidencing the same aggregate
number of Rights as did the Rights Certificate so surrendered.
(b) Except
as
otherwise provided in Section 3.1(b), all Rights issued upon any registration
of
transfer or exchange of Rights Certificates shall be the valid obligations
of
the Company, and such Rights shall be entitled to the same benefits under this
Agreement as the Rights surrendered upon such registration of transfer or
exchange.
(c) Every
Rights Certificate surrendered for registration of transfer or exchange shall
be
duly endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company or the Rights Agent, as the case may be, duly
executed by the holder thereof or such holder’s attorney duly authorized in
writing. As a condition to the issuance of any new Rights Certificate under
this
Section 2.7, the Company may require the payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in relation thereto.
(d) The
Company shall not be required to register the transfer or exchange of any Rights
after such Rights have become void under Section 3.1(b), been exchanged under
Section 3.1(c) or been redeemed under Section 5.1.
2.8 Mutilated,
Destroyed, Lost and Stolen Rights Certificates.
(a) If
any mutilated Rights Certificate is surrendered to the Rights Agent prior to
the
Expiration Time, then, subject to Sections 3.1(b), 3.1(c) and 5.1, the Company
shall execute and the Rights Agent shall countersign and deliver in exchange
therefor a new Rights Certificate evidencing the same number of Rights as did
the Rights Certificate so surrendered.
(b) If
there
shall be delivered to the Company and the Rights Agent prior to the Expiration
Time (i) evidence to their satisfaction of the destruction, loss or theft of
any
Rights Certificate and (ii) such security or indemnity as may be required by
them to save each of them and any of their agents harmless, then, subject to
Sections 3.1(b), 3.1(c) and 5.1 and in the absence of notice to the Company
or
the Rights Agent that such Rights Certificate has been acquired by a bona fide
purchaser, the Company shall execute and upon its request the Rights Agent
shall
countersign and deliver, in lieu of any such destroyed, lost or stolen Rights
Certificate, a new Rights Certificate evidencing the same number of Rights
as
did the Rights Certificate so destroyed, lost or stolen.
-11-
(c) As
a
condition to the issuance of any new Rights Certificate under this Section
2.8,
the Company may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Rights Agent) connected
therewith.
(d) Every
new
Rights Certificate issued pursuant to this Section 2.8 in lieu of any mutilated,
destroyed, lost or stolen Rights Certificate shall evidence an original
additional contractual obligation of the Company, whether or not the mutilated,
destroyed, lost or stolen Rights Certificate shall be at any time enforceable
by
anyone, and, subject to Section 3.1(b), shall be entitled to all the benefits
of
this Agreement equally and proportionately with any and all other Rights duly
issued hereunder.
2.9 Persons
Deemed Owners.
Prior
to due presentment of a Rights Certificate (or, prior to the Separation Time,
the associated Common Stock certificate) for registration of transfer, the
Company, the Rights Agent and any agent of the Company or the Rights Agent
may
deem and treat the person in whose name such Rights Certificate (or, prior
to
the Separation Time, such Common Stock certificate) is registered as the
absolute owner thereof and of the Rights evidenced thereby for all purposes
whatsoever, including the payment of the Redemption Price and neither the
Company nor the Rights Agent shall be affected by any notice to the contrary.
As
used in this Agreement, unless the context otherwise requires, the term “holder”
of any Rights shall mean the registered holder of such Rights (or, prior to
the
Separation Time, the associated shares of Common Stock).
2.10 Delivery
and Cancellation of Certificates.
All
Rights Certificates surrendered upon exercise or for registration of transfer
or
exchange shall, if surrendered to any person other than the Rights Agent, be
delivered to the Rights Agent and, in any case, shall be promptly canceled
by
the Rights Agent. The Company may at any time deliver to the Rights Agent for
cancellation any Rights Certificates previously countersigned and delivered
hereunder which the Company may have acquired in any manner whatsoever, and
all
Rights Certificates so delivered shall be promptly canceled by the Rights Agent.
No Rights Certificates shall be countersigned in lieu of or in exchange for
any
Rights Certificates canceled as provided in this Section 2.10, except as
expressly permitted by this Agreement. The Rights Agent shall destroy all
canceled Rights Certificates and deliver a certificate of destruction to the
Company.
2.11 Agreement
of Rights Holders.
Every
holder of Rights, by accepting the same, consents and agrees with the Company
and the Rights Agent and with every other holder of Rights that:
-12-
(a) prior
to
the Separation Time, each Right will be transferable only together with, and
will be transferred by a transfer of, the associated share of Common Stock;
(b) after
the
Separation Time, the Rights Certificates will be transferable only on the Rights
Register as provided herein;
(c) prior
to
due presentment of a Rights Certificate (or, prior to the Separation Time,
the
associated Common Stock certificate) for registration of transfer, the Company,
the Rights Agent and any agent of the Company or the Rights Agent may deem
and
treat the person in whose name the Rights Certificate (or, prior to the
Separation Time, the associated Common Stock certificate) is registered as
the
absolute owner thereof and of the Rights evidenced thereby for all purposes
whatsoever, and neither the Company nor the Rights Agent shall be affected
by
any notice to the contrary;
(d) Rights
Beneficially Owned by certain Persons will, under the circumstances set forth
in
Section 3.1(b), become void; and
(e) this
Agreement may be supplemented or amended from time to time pursuant to Section
2.4(b) or 5.4 hereof.
ARTICLE
III
ADJUSTMENTS
TO THE RIGHTS IN
THE
EVENT OF CERTAIN TRANSACTIONS
3.1 Flip-in.
(a) In
the event that prior to the Expiration Time a Flip-in Date shall occur, except
as provided in this Section 3.1, each Right shall constitute the right to
purchase from the Company, upon exercise thereof in accordance with the terms
hereof (but subject to Section 5.10), that number of shares of Common Stock
having an aggregate Market Price on the Flip-in Date equal to twice the Exercise
Price for an amount in cash equal to the Exercise Price (such right to be
appropriately adjusted in order to protect the interests of the holders of
Rights generally in the event that on or after such Flip-in Date an event of
a
type analogous to any of the events described in Section 2.4(a) or (b) shall
have occurred with respect to the Common Stock).
(b) Notwithstanding
the foregoing, any Rights that are or were Beneficially Owned on or after the
Flip-in Date by an Acquiring Person or an Affiliate or Associate thereof or
by
any transferee, direct or indirect, of any of the foregoing shall become void
and any holder of such Rights (including transferees) shall thereafter have
no
right to exercise or transfer such Rights under any provision of this Agreement.
If any Rights Certificate is presented for assignment or exercise and the Person
presenting the same will not complete the certification set forth at the end
of
the form of assignment or notice of election to exercise and provide such
additional evidence of the identity of the Beneficial Owner and its Affiliates
and Associates (or former Beneficial Owners and their Affiliates and Associates)
as the Company shall reasonably request, then the Company shall be entitled
conclusively to deem the Beneficial Owner thereof to be an Acquiring Person
or
an Affiliate or Associate thereof or a transferee of any of the foregoing and
accordingly will deem the Rights evidenced thereby to be void and not
transferable or exercisable.
-13-
(c) The
Board
of Directors of the Company may, at its option, at any time after a Flip-in
Date
and prior to the time that an Acquiring Person becomes the Beneficial Owner
of
more than 50% of the outstanding shares of Common Stock, elect to exchange
all
(but not less than all) the then outstanding Rights (which shall not include
Rights that have become void pursuant to the provisions of Section 3.1(b))
for
shares of Common Stock at an exchange ratio of one share of Common Stock per
Right, appropriately adjusted in order to protect the interests of holders
of
Rights generally in the event that after the Separation Time an event of a
type
analogous to any of the events described in Section 2.4(a) or (b) shall have
occurred with respect to the Common Stock (such exchange ratio, as adjusted
from
time to time, being hereinafter referred to as the “Exchange Ratio”).
Immediately
upon the action of the Board of Directors of the Company electing to exchange
the Rights, without any further action and without any notice, the right to
exercise the Rights will terminate and each Right (other than Rights that have
become void pursuant to Section 3.1(b)) will thereafter represent only the
right
to receive a number of shares of Common Stock equal to the Exchange Ratio.
Promptly after the action of the Board of Directors electing to exchange the
Rights, the Company shall give notice thereof (specifying the steps to be taken
to receive shares of Common Stock in exchange for Rights) to the Rights Agent
and the holders of the Rights (other than Rights that have become void pursuant
to Section 3.1(b)) outstanding immediately prior thereto by mailing such notice
in accordance with Section 5.9.
Each
Person in whose name any certificate for shares is issued upon the exchange
of
Rights pursuant to this Section 3.1(c) or Section 3.1(d) shall for all purposes
be deemed to have become the holder of record of the shares represented thereby
on, and such certificate shall be dated, the date upon which the Rights
Certificate evidencing such Rights was duly surrendered and payment of any
applicable taxes and other governmental charges payable by the holder was made;
provided, however, that if the date of such surrender and payment is a date
upon
which the stock transfer books of the Company are closed, such Person shall
be
deemed to have become the record holder of such shares on, and such certificate
shall be dated, the next succeeding Business Day on which the stock transfer
books of the Company are open.
(d) Whenever
the Company shall become obligated under Section 3.1(a) or (c) to issue shares
of Common Stock upon exercise of or in exchange for Rights, the Company, at
its
option, may substitute therefor shares of Preferred Stock, at a ratio of one
one-hundredth (1/100) of a share of Preferred Stock for each share of Common
Stock so issuable.
(e) In
the
event that there shall not be sufficient treasury shares or authorized but
unissued shares of Common Stock or Preferred Stock of the Company to permit
the
exercise or exchange in full of the Rights in accordance with Section 3.1(a)
or
(c), and the Company elects not to, or is otherwise unable to, make the exchange
referred to in Section 3.1(d), the Company shall either (i) call a meeting
of
stockholders seeking approval to cause sufficient additional shares to be
authorized (provided, that if such approval is not obtained the Company will
take the action specified in clause (ii) of this sentence) or (ii) take such
action as shall be necessary to ensure and provide, to the extent permitted
by
applicable law and any agreements or instruments in effect on the Stock
Acquisition Date to which it is a party, that each Right shall thereafter
constitute the right to receive, (x) at the Company’s option, either (A) in
return for the Exercise Price, debt or equity securities or other assets (or
a
combination thereof) having a fair value equal to twice the Exercise Price,
or
(B) without payment of consideration (except as otherwise required by applicable
law), debt or equity securities or other assets (or a combination thereof)
having a fair value equal to the Exercise Price, or (y) if the Board of
Directors of the Company elects to exchange the Rights in accordance with
Section 3.1(c), debt or equity securities or other assets (or a combination
thereof) having a fair value equal to the product of the Market Price of a
share
of Common Stock on the Flip-in Date times the Exchange Ratio in effect on the
Flip-in Date, where in any case set forth in (x) or (y) above the fair value
of
such debt or equity securities or other assets shall be as determined in good
faith by the Board of Directors of the Company, after consultation with a
nationally recognized investment banking firm.
-14-
(f) The
Company agrees that after the Flip-in Date and prior to the Expiration Time,
it
shall not, unless the Rights are exchanged pursuant to this Section 3.1 or
redeemed pursuant to Section 5.1, take any action if at the time such action
is
taken it is reasonably foreseeable that such action will diminish substantially
or eliminate the benefits intended to be afforded by the Rights.
3.2 Flip-over.
(a)
Prior to the Expiration Time, unless the Rights have been redeemed pursuant
to
Section 5.1 hereof in connection therewith, the Company shall not enter into
any
agreement with respect to, consummate or permit to occur any Flip-over
Transaction or Event unless and until it shall have entered into a supplemental
agreement with the Flip-over Entity, for the benefit of the holders of the
Rights, providing that, upon consummation or occurrence of the Flip-over
Transaction or Event (i) each Right shall thereafter constitute the right to
purchase from the Flip-over Entity, upon exercise thereof in accordance with
the
terms hereof, that number of shares of Flip-over Stock of the Flip-over Entity
having an aggregate Market Price on the date of consummation or occurrence
of
such Flip-over Transaction or Event equal to twice the Exercise Price for an
amount in cash equal to the Exercise Price (such right to be appropriately
adjusted in order to protect the interests of the holders of Rights generally
in
the event that after such date of consummation or occurrence an event of a
type
analogous to any of the events described in Section 2.4(a) or (b) shall have
occurred with respect to the Flip-over Stock) and (ii) the Flip- over Entity
shall thereafter be liable for, and shall assume, by virtue of such Flip-over
Transaction or Event and such supplemental agreement, all the obligations and
duties of the Company pursuant to this Agreement. The provisions of this Section
3.2 shall apply with equal force to successive Flip-over Transactions or Events.
(b) Prior
to
the Expiration Time, unless the Rights will be redeemed pursuant to Section
5.1
hereof in connection therewith, the Company shall not enter into any agreement
with respect to, consummate or permit to occur any Flip-over Transaction or
Event if at the time thereof there are any rights, warrants or securities
outstanding or any other arrangements, agreements or instruments that would
eliminate or otherwise diminish in any material respect the benefits intended
to
be afforded by this Rights Agreement to the holders of Rights upon consummation
of such transaction.
-15-
ARTICLE
IV
THE
RIGHTS AGENT
4.1 General.
(a) The
Company hereby appoints the Rights Agent to act as agent for the Company in
accordance with the terms and conditions hereof, and the Rights Agent hereby
accepts such appointment. The Company agrees to pay to the Rights Agent
reasonable compensation for all services rendered by it hereunder and, from
time
to time and 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 to be done by the Rights Agent in connection with the acceptance and
administration of this Agreement, including the costs and expenses of defending
against any claim of liability.
(b) The
Rights Agent shall be protected and shall incur no liability for or in respect
of any action taken, suffered to be taken or not taken by it in connection
with
its administration of this Agreement in reliance upon any certificate for
securities purchasable upon exercise of Rights, Rights Certificate, certificate
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.
4.2 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 is a party, or any corporation succeeding to the shareholder services
business of the Rights Agent or any successor Rights Agent, will be the
successor to the Rights Agent under this Agreement without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
provided, that such corporation would be eligible for appointment as a successor
Rights Agent under the provisions of Section 4.4 hereof. In case at the time
such successor Rights Agent succeeds to the agency created by this Agreement
any
of the Rights Certificates have been countersigned but not delivered, any such
successor Rights Agent may adopt the countersignature of the predecessor Rights
Agent and deliver such Rights Certificates so countersigned; and in case at
that
time any of the Rights Certificates have not 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 will 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 is 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.
-16-
4.3 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 legal counsel (who may be legal counsel for the
Company), and the opinion of such counsel will be full and complete
authorization and protection to the Rights Agent as to any action taken or
not
taken 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 deems
it
necessary or desirable that any fact or matter be proved or established by
the
Company prior to taking or suffering to be taken 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 a person believed by the Rights Agent to be the Chairman
of the Board, the President or any Vice President and by the Treasurer or any
Assistant Treasurer or the Secretary or any Assistant Secretary of the Company
and delivered to the Rights Agent; and such certificate will be full
authorization to the Rights Agent for any action taken or suffered to be taken
in good faith by it under the provisions of this Agreement in reliance upon
such
certificate.
(c) The
Rights Agent will be liable hereunder only for its own negligence, bad faith
or
willful misconduct.
(d) The
Rights Agent will not be liable for or by reason of any of the statements of
fact or recitals contained in this Agreement or in the certificates for
securities purchasable upon exercise of Rights or the Rights Certificates
(except its countersignature thereof) or be required to verify the same, but
all
such statements and recitals are and will be deemed to have been made by the
Company only.
(e) The
Rights Agent will not be under any responsibility in respect of the validity
of
this Agreement or the execution and delivery hereof (except the due
authorization, execution and delivery hereof by the Rights Agent) or in respect
of the validity or execution of any certificate for securities purchasable
upon
exercise of Rights or Rights Certificate (except its countersignature thereof);
nor will it be responsible for any breach by the Company of any covenant or
condition contained in this Agreement or in any Rights Certificate; nor will
it
be responsible for any change in the exercisability of the Rights (including
the
Rights becoming void pursuant to Section 3.1(b) hereof) or any adjustment
required under the provisions of Section 2.4, 3.1 or 3.2 hereof or 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 after receipt of the certificate contemplated
by Section 2.4 describing any such adjustment); nor will it by any act hereunder
be deemed to make any representation or warranty as to the authorization or
reservation of any securities purchasable upon exercise of Rights or any Rights
or as to whether any securities purchasable upon exercise of Rights will, when
issued, be duly and validly authorized, executed, issued and delivered and
fully
paid and nonassessable.
-17-
(f) The
Company agrees that it will perform, execute, acknowledge and deliver or cause
to be performed, executed, acknowledged and delivered all such further and
other
acts, instruments and assurances as may reasonably be required by the Rights
Agent for the carrying out or 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 person believed
by
the Rights Agent to be the Chairman of the Board, the President, any Vice
President, the Secretary or any Assistant Secretary or the Treasurer or any
Assistant Treasurer of the Company, and to apply to such persons for advice
or
instructions in connection with its duties, and it shall not be liable for
any
action taken or suffered by it in good faith in accordance with instructions
of
any such person.
(h) The
Rights Agent and any stockholder, director, officer or employee of the Rights
Agent may buy, sell or deal in Common Stock, 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 will not be answerable or accountable for any
act, default, neglect or misconduct of any such attorneys or agents or for
any
loss to the Company resulting from any such act, default, neglect or misconduct,
provided reasonable care was exercised in the selection and continued employment
thereof.
4.4 Change
of Rights Agent.
The
Rights Agent may resign and be discharged from its duties under this Agreement
upon 90 days’ notice (or such lesser notice as is acceptable to the Company) in
writing mailed to the Company and to each transfer agent of Common Stock by
registered or certified mail, and, following the Separation Time, to the holders
of the Rights in accordance with Section 5.9. The Company may remove the Rights
Agent upon 30 days’ notice in writing, mailed to the Rights Agent and to each
transfer agent of the Common Stock by registered or certified mail, and to
the
holders of the Rights in accordance with Section 5.9. If the Rights Agent should
resign or be removed or otherwise become incapable of acting, the Company will
appoint a successor to the Rights Agent. If the Company fails to make such
appointment within a period of 30 days after 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 any Rights (which holder shall,
with such notice, submit such holder’s Rights Certificate for inspection by the
Company), then the holder of any Rights may apply to any court of competent
jurisdiction for the appointment of a new Rights Agent. Any successor Rights
Agent, whether appointed by the Company or by such a court, shall be a
corporation organized 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 the powers of the Rights Agent contemplated by this
Agreement 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 $50,000,000. After appointment, the
successor Rights Agent will 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 will file notice thereof in writing with the predecessor Rights Agent
and each transfer agent of the Common Stock, and, following the Separation
Time,
mail a notice thereof in writing to the holders of the Rights. Failure to give
any notice provided for in this Section 4.4, 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. No resignation or removal of the Rights Agent shall be effective until
a
successor Rights Agent is appointed in accordance with this Section 4.4.
-18-
ARTICLE
V
MISCELLANEOUS
5.1 Redemption.
(a) The
Board of Directors of the Company may, at its option, at any time prior to
the
Flip-in Date, elect to redeem all (but not less than all) the then outstanding
Rights at the Redemption Price and the Company, at its option, may pay the
Redemption Price either in cash or shares of Common Stock or other securities
of
the Company deemed by the Board of Directors, in the exercise of its sole
discretion, to be at least equivalent in value to the Redemption Price.
(b) Immediately
upon the action of the Board of Directors of the Company electing to redeem
the
Rights (or, if the resolution of the Board of Directors electing to redeem
the
Rights states that the redemption will not be effective until the occurrence
of
a specified future time or event, upon the occurrence of such future time or
event), without any further action and without any notice, the right to exercise
the Rights will terminate and each Right will thereafter represent only the
right to receive the Redemption Price in cash or securities, as determined
by
the Board of Directors. Promptly after the Rights are redeemed, the Company
shall give notice of such redemption to the Rights Agent and the holders of
the
then outstanding Rights by mailing such notice in accordance with Section 5.9.
5.2 Expiration.
The
Rights and this Agreement shall expire at the Expiration Time and no Person
shall have any rights pursuant to this Agreement or any Right after the
Expiration Time, except, if the Rights are exchanged or redeemed, as provided
in
Section 3.1 or 5.1 hereof.
5.3 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 number or kind or class of shares of
stock purchasable upon exercise of Rights made in accordance with the provisions
of this Agreement. In addition, in connection with the issuance or sale of
shares of Common Stock by the Company following the Separation Time and prior
to
the Expiration Time pursuant to the terms of securities convertible or
redeemable into shares of Common Stock or to options, in each case issued or
granted prior to, and outstanding at, the Separation Time, the Company shall
issue to the holders of such shares of Common Stock, Rights Certificates
representing the appropriate number of Rights in connection with the issuance
or
sale of such shares of Common Stock; provided, however, in each case, (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 to the Person to whom
such Rights Certificates would be issued, (ii) no such Rights Certificates
shall
be issued if, and to the extent that, appropriate adjustment shall have
otherwise been made in lieu of the issuance thereof, and (iii) the Company
shall
have no obligation to distribute Rights Certificates to any Acquiring Person
or
Affiliate or Associate of an Acquiring Person or any transferee of any of the
foregoing.
-19-
5.4 Supplements
and Amendments.
The
Company and the Rights Agent may from time to time supplement or amend this
Agreement without the approval of any holders of Rights (i) prior to the Flip-in
Date, in any respect and (ii) after the Flip-in Date, to make any changes that
the Company may deem necessary or desirable and which shall not materially
adversely affect the interests of the holders of Rights generally or in order
to
cure any ambiguity or to correct or supplement any provision contained herein
which may be inconsistent with any other provisions herein or otherwise
defective. The Rights Agent will duly execute and deliver any supplement or
amendment hereto requested by the Company which satisfies the terms of the
preceding sentence.
5.5 Fractional
Shares.
If the
Company elects not to issue certificates representing fractional shares upon
exercise or redemption of Rights, the Company shall, in lieu thereof, in the
sole discretion of the Board of Directors, either (a) evidence such fractional
shares by depositary receipts issued pursuant to an appropriate agreement
between the Company and a depositary selected by it, providing that each holder
of a depositary receipt shall have all of the rights, privileges and preferences
to which such holder would be entitled as a beneficial owner of such fractional
share, or (b) sell such shares on behalf of the holders of Rights and pay to
the
registered holder of such Rights the appropriate fraction of the price per
share
received upon such sale.
5.6 Rights
of Action.
Subject
to the terms of this Agreement (including Section 3.1(b)), rights of action
in
respect of this Agreement, other than rights of action vested solely in the
Rights Agent, are vested in the respective holders of the Rights; and any holder
of any Rights, without the consent of the Rights Agent or of the holder of
any
other Rights, may, on such holder’s own behalf and for such holder’s own benefit
and the benefit of other holders of Rights, enforce, and may institute and
maintain any suit, action or proceeding against the Company to enforce, or
otherwise act in respect of, such holder’s right to exercise such holder’s
Rights in the manner provided in such holder’s 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.
-20-
5.7 Holder
of Rights Not Deemed a Stockholder.
No
holder, as such, of any Rights shall be entitled to vote, receive dividends
or
be deemed for any purpose the holder of shares or any other securities which
may
at any time be issuable on the exercise of such Rights, nor shall anything
contained herein or in any Rights Certificate be construed to confer upon the
holder of any Rights, 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 5.8 hereof), or to receive dividends
or subscription rights, or otherwise, until such Rights shall have been
exercised or exchanged in accordance with the provisions hereof.
5.8 Notice
of Proposed Actions.
In case
the Company shall propose after the Separation Time and prior to the Expiration
Time (i) to effect or permit a Flip-over Transaction or Event or (ii) 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 Right, in accordance with
Section 5.9 hereof, a notice of such proposed action, which shall specify the
date on which such Flip-over Transaction or Event, liquidation, dissolution,
or
winding up is to take place, and such notice shall be so given at least twenty
(20) Business Days prior to the date of the taking of such proposed action.
5.9 Notices.
Notices
or demands authorized or required by this Agreement to be given or made by
the
Rights Agent or by the holder of any Rights to or on the Company shall be
sufficiently given or made if delivered or sent by first-class mail, postage
prepaid, addressed (until another address is filed in writing with the Rights
Agent) as follows:
Wilshire
Enterprises, Inc.
0
Xxxxxxx
Xxxxxx
Xxxxxx,
Xxx Xxxxxx 00000
Attention:
S. Xxxxxx Xxxx
with
a
copy to:
Xxxxx
X.
Xxxxxxxxx, Esq.
Xxxxxxxxxx
Xxxxxxx PC
00
Xxxxxxxxxx Xxxxxx
Xxxxxxxx,
Xxx Xxxxxx 00000
Any
notice or demand authorized or required by this Agreement to be given or made
by
the Company or by the holder of any Rights to or on the Rights Agent shall
be
sufficiently given or made if delivered or sent by first-class mail, postage
prepaid, addressed (until another address is filed in writing with the Company)
as follows:
-21-
Continental
Stock Transfer & Trust Company
00
Xxxxxxx Xxxxx, 0xx Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Chairman
Notices
or demands authorized or required by this Agreement to be given or made by
the
Company or the Rights Agent to or on the holder of any Rights shall be
sufficiently given or made if delivered or sent by first-class mail, postage
prepaid, addressed to such holder at the address of such holder as it appears
upon the registry books of the Rights Agent or, prior to the Separation Time,
on
the registry books of the transfer agent for the Common Stock. Any notice which
is mailed in the manner herein provided shall be deemed given, whether or not
the holder receives the notice.
5.10 Suspension
of Exercisability.
To the
extent that the Company determines in good faith that some action will or need
be taken pursuant to Section 3.1 or to comply with federal or state securities
laws, the Company may suspend the exercisability of the Rights for a reasonable
period in order to take such action or comply with such laws. In the event
of
any such suspension, the Company shall issue as promptly as practicable a public
announcement stating that the exercisability or exchangeability of the Rights
has been temporarily suspended. Notice thereof pursuant to Section 5.9 shall
not
be required. Failure to give a notice pursuant to the provisions of this
Agreement shall not affect the validity of any action taken hereunder.
5.11 Costs
of Enforcement.
The
Company agrees that if the Company or any other Person the securities of which
are purchasable upon exercise of Rights fails to fulfill any of its obligations
pursuant to this Agreement, then the Company or such Person will reimburse
the
holder of any Rights for the costs and expenses (including legal fees) incurred
by such holder in actions to enforce such holder’s rights pursuant to any Rights
or this Agreement.
5.12 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.
5.13 Benefits
of this Agreement.
Nothing
in this Agreement shall be construed to give to any Person other than the
Company, the Rights Agent and the holders of the Rights any legal or equitable
right, remedy or claim under this Agreement; but this Agreement shall be for
the
sole and exclusive benefit of the Company, the Rights Agent and the holders
of
the Rights.
5.14 Determination
and Actions by the Board of Directors, etc.
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 to the Company, or as may be necessary or advisable
in
the administration of this Agreement, including, without limitation, the right
and power to (i) interpret the provisions of this Agreement and (ii) make all
determinations deemed necessary or advisable for the administration of this
Agreement. All such actions, calculations, interpretations and determinations
which are done or made by the Board in good faith shall be final, conclusive
and
binding on the Company, the Rights Agent, the holders of the Rights and all
other parties.
-22-
5.15 Descriptive
Headings.
Descriptive headings appear herein for convenience only and shall not control
or
affect the meaning or construction of any of the provisions hereof.
5.16 Governing
Law.
THIS
AGREEMENT 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.
5.17 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.
5.18 Severability.
If any
term or provision hereof or the application thereof to any circumstance shall,
in any jurisdiction and to any extent, be invalid or unenforceable, such term
or
provision shall be ineffective as to such jurisdiction to the extent of such
invalidity or unenforceability without invalidating or rendering unenforceable
the remaining terms and provisions hereof or the application of such term or
provision to circumstances other than those as to which it is held invalid
or
unenforceable.
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.
|
WILSHIRE
ENTERPRISES, INC.
|
||
| |
|
|
| By: | /s/ S. Xxxxxx Xxxx | |
|
Name:
S. Xxxxxx Xxxx
Title:
Chairman & CEO
|
||
-23-
| CONTINENTAL STOCK TRANSFER & TRUST COMPANY | ||
| |
|
|
| By: | /s/ X. Xxxxxxxxxx | |
|
Name:
X. Xxxxxxxxxx
Title:
Vice President
|
||
-24-
EXHIBIT
A
[Form
of
Rights Certificate]
| Certificate No. W- |
_______
Rights
|
THE
RIGHTS ARE SUBJECT TO REDEMPTION OR MANDATORY EXCHANGE, AT THE OPTION OF THE
COMPANY, ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. RIGHTS BENEFICIALLY
OWNED BY ACQUIRING PERSONS OR AFFILIATES OR ASSOCIATES THEREOF (AS SUCH TERMS
ARE DEFINED IN THE RIGHTS AGREEMENT) OR TRANSFEREES OF ANY OF THE FOREGOING
WILL
BE VOID.
Rights
Certificate
WILSHIRE
ENTERPRISES, INC.
This
certifies that ____________________, or registered assigns, is the registered
holder of the number of Rights set forth above, each of which entitles the
registered holder thereof, subject to the terms, provisions and conditions
of
the Amended and Restated Stockholder Protection Rights Agreement, dated as
of
June 22, 2006 (as amended from time to time, the “Rights Agreement”), between
Wilshire Enterprises, Inc., a Delaware corporation (the “Company”), and
Continental Stock Transfer & Trust Company, a limited purpose trust company
organized under the banking laws of the State of New York, as Rights Agent
(the
“Rights Agent”, which term shall include any successor Rights Agent under the
Rights Agreement), to purchase from the Company at any time after the Separation
Time (as such term is defined in the Rights Agreement) and prior to the
Expiration Time (as defined in the Rights Agreement), one one-hundredth (1/100)
of a fully paid share of Series A Participating Preferred Stock, par value
$1.00
per share (the “Preferred Stock”), of the Company (subject to adjustment as
provided in the Rights Agreement) at the Exercise Price referred to below,
upon
presentation and surrender of this Rights Certificate with the Form of Election
to Exercise duly executed at the principal office of the Rights Agent in New
York, New York. The Exercise Price shall initially be $25.00 per Right and
shall
be subject to adjustment in certain events as provided in the Rights Agreement.
In
certain circumstances described in the Rights Agreement, the Rights evidenced
hereby may entitle the registered holder thereof to purchase securities of
an
entity other than the Company or securities or assets of the Company other
than
Preferred Stock, all as provided in the Rights Agreement.
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. Copies
of
the Rights Agreement are on file at the principal executive offices of the
Company and are available without cost upon written request.
-1-
This
Rights Certificate, with or without other Rights Certificates, upon surrender
at
the office of the Rights Agent designated for such purpose, may be exchanged
for
another Rights Certificate or Rights Certificates of like tenor evidencing
an
aggregate number of Rights equal to the aggregate number of Rights evidenced
by
the Rights Certificate or Rights Certificates surrendered. If this Rights
Certificate shall be exercised in part, the registered 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, each Right evidenced by this
Certificate may be (a) redeemed by the Company under certain circumstances,
at
its option, at a redemption price of $0.01 per Right or (b) exchanged by the
Company under certain circumstances, at its option, for one share of Common
Stock or one one-hundredth (1/100) of a share of Preferred Stock per Right
(or,
in certain cases, other securities or assets of the Company), subject in each
case to adjustment in certain events as provided in the Rights Agreement.
No
holder
of this Rights Certificate, as such, shall be entitled to vote or receive
dividends or be deemed for any purpose the holder of any securities which may
at
any time be issuable on the exercise hereof, nor shall anything contained in
the
Rights Agreement or herein be construed to confer upon the holder hereof, as
such, any of the rights of a stockholder of the Company or any right to vote
for
the election of directors or upon any matter submitted to stockholders at any
meeting thereof, or to give or withhold consent to any corporate action, or
to
receive notice of meetings or other actions affecting stockholders (except
as
provided in the Rights Agreement), or to receive dividends or subscription
rights, or otherwise, until the Rights evidenced by this Rights Certificate
shall have been exercised or exchanged 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.
| Date: ____________ | ||
| ATTEST: | WILSHIRE ENTERPRISES, INC. | |
| |
|
|
| By: | ||
|
Secretary
or
Assistant Secretary
|
Name: |
|
| Title: | ||
-2-
Countersigned:
| CONTINENTAL STOCK TRANSFER & TRUST COMPANY | ||
| |
|
|
| By: | ||
|
Authorized
Signature
|
||
-3-
[Form
of
Reverse Side of Rights Certificate]
FORM
OF ASSIGNMENT
(To
be
executed by the registered holder if such
holder
desires to transfer this Rights Certificate.)
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 _______________ as attorney,
to
transfer the within Rights Certificate on the books of the within-named Company,
with full power of substitution.
Dated:
_______________, 20__
|
Signature
Guaranteed:
|
___________________________________
|
|
Signature
|
|
|
(Signature
must correspond to name as written upon the face of this Rights
Certificate in every particular, without alteration or enlargement
or any
change whatsoever)
|
Signatures
must be guaranteed by a participant in a Securities Transfer Association
recognized signature program.
(To
be
completed if true)
The
undersigned hereby represents, for the benefit of all holders of Rights and
shares of Common Stock, that the Rights evidenced by this Rights Certificate
are
not, and, to the knowledge of the undersigned, have never been, Beneficially
Owned by an Acquiring Person or an Affiliate or Associate thereof (as defined
in
the Rights Agreement).
|
___________________________________
Signature
|
NOTICE
In
the
event the certification set forth above is not completed in connection with
a
purported assignment, the Company will deem the Beneficial Owner of the Rights
evidenced by the enclosed Rights Certificate to be an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement) or a
transferee of any of the foregoing and accordingly will deem the Rights
evidenced by such Rights Certificate to be void and not transferable or
exercisable.
-4-
[To
be
attached to each Rights Certificate]
FORM
OF ELECTION TO EXERCISE
(To
be
executed if holder desires to
exercise
the Rights Certificate.)
TO:
WILSHIRE ENTERPRISES, INC.
The
undersigned hereby irrevocably elects to exercise _______________________ whole
Rights represented by the attached Rights Certificate to purchase the shares
of
Series A Participating Preferred Stock issuable upon the exercise of such Rights
and requests that certificates for such shares be issued in the name of:
___________________________________________________
Name
___________________________________________________
Address
___________________________________________________
Social
Security or Other Taxpayer Identification Number
If
such
number of Rights shall not be all the Rights evidenced by this Rights
Certificate, a new Rights Certificate for the balance of such Rights shall
be
registered in the name of and delivered to:
___________________________________________________
Name
___________________________________________________
Address
___________________________________________________
Social
Security or Other Taxpayer Identification Number
Dated:
_______________, 20__
|
Signature
Guaranteed:
|
___________________________________
|
|
Signature
|
|
|
(Signature
must correspond to name as written upon the face of this Rights
Certificate in every particular, without alteration or enlargement
or any
change whatsoever)
|
Signatures
must be guaranteed by a participant in a Securities Transfer Association
recognized signature program.
-5-
(To
be
completed if true)
The
undersigned hereby represents, for the benefit of all holders of Rights and
shares of Common Stock, that the Rights evidenced by the attached Rights
Certificate are not, and, to the knowledge of the undersigned, have never been,
Beneficially Owned by an Acquiring Person or an Affiliate or Associate thereof
(as defined in the Rights Agreement).
|
___________________________________
Signature
|
NOTICE
In
the
event the certification set forth above is not completed in connection with
a
purported exercise, the Company will deem the Beneficial Owner of the Rights
evidenced by the attached Rights Certificate to be an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement) or a
transferee of any of the foregoing and accordingly will deem the Rights
evidenced by such Rights Certificate to be void and not transferable or
exercisable.
-6-
EXHIBIT
B
FORM
OF CERTIFICATE OF DESIGNATIONS AND TERMS
OF
SERIES A PARTICIPATING PREFERRED STOCK
OF
WILSHIRE ENTERPRISES, INC.
Pursuant
to Section 151 of the General
Corporation
Law of the State of Delaware
Wilshire
Enterprises, Inc., a Delaware corporation (the “Corporation”), does hereby
certify as follows:
Pursuant
to authority granted by Article FOURTH of the Restated Certificate of
Incorporation of the Corporation, as amended, and in accordance with the
provisions of Section 151 of the General Corporation Law of the State of
Delaware, the Board of Directors of the Corporation has adopted the following
resolutions fixing the designation and certain terms, powers, preferences and
other rights of a new series of the Corporation’s Preferred Stock, par value
$1.00 per share, and certain qualifications, limitations and restrictions
thereon:
RESOLVED,
that there is hereby established a series of Preferred Stock, par value $1.00
per share, of the Corporation, and the designation and certain terms, powers,
preferences and other rights of the shares of such series, and certain
qualifications, limitations and restrictions thereon, are hereby fixed as
follows:
(i) The
distinctive serial designation of this series shall be “Series A Participating
Preferred Stock” (hereinafter called “this Series”). Each share of this Series
shall be identical in all respects with the other shares of this Series except
as to the dates from and after which dividends thereon shall be cumulative.
(ii) The
number of shares in this Series shall initially be 375,000 which number may
from
time to time be increased or decreased (but not below the number then
outstanding) by the Board of Directors. Shares of this Series purchased by
the
Corporation shall be canceled and shall revert to authorized but unissued shares
of Preferred Stock undesignated as to series. Shares of this Series may be
issued in fractional shares, which fractional shares shall entitle the holder,
in proportion to such holder’s fractional share, to all rights of a holder of a
whole share of this Series.
(iii) The
holders of full or fractional shares of this Series shall be entitled to
receive, when and as declared by the Board of Directors, but only out of funds
legally available therefor, dividends, (A) on each date that dividends or other
distributions (other than dividends or distributions payable in Common Stock
of
the Corporation) are payable on or in respect of Common Stock comprising part
of
the Reference Package (as defined below), in an amount per whole share of this
Series equal to the aggregate amount of dividends or other distributions (other
than dividends or distributions payable in Common Stock of the Corporation)
that
would be payable on such date to a holder of the Reference Package and (B)
on
the last day of March, June, September and December in each year, in an amount
per whole share of this Series equal to the excess (if any) of $6.25 over the
aggregate dividends paid per whole share of this Series during the three month
period ending on such last day. Each such dividend shall be paid to the holders
of record of shares of this Series on the date, not exceeding sixty days
preceding such dividend or distribution payment date, fixed for the purpose
by
the Board of Directors in advance of payment of each particular dividend or
distribution. Dividends on each full and each fractional share of this Series
shall be cumulative from the date such full or fractional share is originally
issued; provided, that any such full or fractional share originally issued
after
a dividend record date and on or prior to the dividend payment date to which
such record date relates shall not be entitled to receive the dividend payable
on such dividend payment date or any amount in respect of the period from such
original issuance to such dividend payment date.
-1-
The
term
“Reference Package” shall initially mean 100 shares of Common Stock, par value
$1.00 per share (“Common Stock”), of the Corporation. In the event the
Corporation shall at any time after the close of business on June 22, 2006
(A)
declare or pay a dividend on any Common Stock payable in Common Stock, (B)
subdivide any Common Stock or (C) combine any Common Stock into a smaller
number of shares, then and in each such case the Reference Package after such
event shall be the Common Stock that a holder of the Reference Package
immediately prior to such event would hold thereafter as a result thereof.
Holders
of shares of this Series shall not be entitled to any dividends, whether payable
in cash, property or stock, in excess of full cumulative dividends, as herein
provided on this Series.
So
long
as any shares of this Series are outstanding, no dividend (other than a dividend
in Common Stock or in any other stock ranking junior to this Series as to
dividends and upon liquidation) shall be declared or paid or set aside for
payment or other distribution declared or made upon the Common Stock or upon
any
other stock ranking junior to this Series as to dividends or upon liquidation,
nor shall any Common Stock nor any other stock of the Corporation ranking junior
to or on a parity with this Series as to dividends or upon liquidation be
redeemed, purchased or otherwise acquired for any consideration (or any moneys
be paid to or made available for a sinking fund for the redemption of any shares
of any such stock) by the Corporation (except by conversion into or exchange
for
stock of the Corporation ranking junior to this Series as to dividends and
upon
liquidation), unless, in each case, the full cumulative dividends (including
the
dividend to be due upon payment of such dividend, distribution, redemption,
purchase or other acquisition) on all outstanding shares of this Series shall
have been, or shall contemporaneously be, paid.
(iv) In
the
event of any merger, consolidation, reclassification 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 the shares
of this Series shall at the same time be similarly exchanged or changed in
an
amount per whole share equal to the aggregate amount of stock, securities,
cash
and/or any other property (payable in kind), as the case may be, that a holder
of the Reference Package would be entitled to receive as a result of such
transaction.
-2-
(v) In
the
event of any liquidation, dissolution or winding up of the affairs of the
Corporation, whether voluntary or involuntary, the holders of full and
fractional shares of this Series shall be entitled, before any distribution
or
payment is made on any date to the holders of the Common Stock or any other
stock of the Corporation ranking junior to this Series upon liquidation, to
be
paid in full an amount per whole share of this Series equal to the greater
of
(A) $2,500.00 or (B) the aggregate amount distributed or to be distributed
prior to such date in connection with such liquidation, dissolution or winding
up to a holder of the Reference Package (such greater amount being hereinafter
referred to as the “Liquidation Preference”), together with accrued dividends to
such distribution or payment date, whether or not earned or declared. If such
payment shall have been made in full to all holders of shares of this Series,
the holders of shares of this Series as such shall have no right or claim to
any
of the remaining assets of the Corporation.
In
the
event the assets of the Corporation available for distribution to the holders
of
shares of this Series upon any liquidation, dissolution or winding up of the
Corporation, whether voluntary or involuntary, shall be insufficient to pay
in
full all amounts to which such holders are entitled pursuant to the first
paragraph of this Section (v), no such distribution shall be made on account
of
any shares of any other class or series of Preferred Stock ranking on a parity
with the shares of this Series upon such liquidation, dissolution or winding
up
unless proportionate distributive amounts shall be paid on account of the shares
of this Series, ratably in proportion to the full distributable amounts for
which holders of all such parity shares are respectively entitled upon such
liquidation, dissolution or winding up.
Upon
the
liquidation, dissolution or winding up of the Corporation, the holders of shares
of this Series then outstanding shall be entitled to be paid out of assets
of
the Corporation available for distribution to its stockholders all amounts
to
which such holders are entitled pursuant to the first paragraph of this Section
(v) before any payment shall be made to the holders of Common Stock or any
other
stock of the Corporation ranking junior upon liquidation to this Series.
For
the
purposes of this Section (v), the consolidation or merger of, or binding share
exchange by, the Corporation with any other corporation shall not be deemed
to
constitute a liquidation, dissolution or winding up of the Corporation.
(vi) The
shares of this Series shall not be redeemable.
(vii) In
addition to any other vote or consent of stockholders required by law or by
the
Restated Certificate of Incorporation, as amended, of the Corporation, each
whole share of this Series shall, on any matter, vote as a class with any other
capital stock comprising part of the Reference Package and voting on such matter
and shall have one vote per share.
(viii) The
Series A Participating Preferred Stock shall rank junior as to the payment
of
dividends and amounts upon liquidation, dissolution and winding up to all of
the
Corporation’s capital stock except (A) the Common Stock and (B) any other
capital stock of the Corporation which by its terms ranks junior to the Series
A
Participating Preferred Stock as to the payment of dividends or amounts upon
liquidation, dissolution or winding up.
-3-
(ix) Other
than as set forth herein and as provided by law, the Series A Participating
Preferred Stock shall not have any other powers, preference or other rights
or
privileges.
IN
WITNESS WHEREOF, the Corporation has caused this certificate to be duly signed
by S. Xxxxxx Xxxx, its Chairman of the Board and Chief Executive Officer, on
the
22nd day of June, 2006.
| WILSHIRE ENTERPRISES, INC. | ||
| |
|
|
| By: | ||
|
S. Xxxxxx Xxxx
Chairman
of the Board and
Chief
Executive Officer
|
||
-4-
