AMENDMENT TO RIGHTS AGREEMENT
AMENDMENT
TO RIGHTS AGREEMENT
This
Amendment dated as of September
10, 2007 (this “Amendment”), amends the Rights Agreement, dated as of
September 14, 1999 (the “Agreement”), by and between United Retail Group,
Inc. a Delaware corporation (the “Company”), and Continental Stock
Transfer & Trust Company, a New York banking corporation (the “Rights
Agent”). All capitalized terms used but not defined in this
Amendment shall have the meanings ascribed to them in the
Agreement.
Whereas,
Redcats USA, Inc., a Delaware
corporation (“Parent”), Boulevard Merger Sub, Inc., a newly formed
Delaware corporation and a wholly owned subsidiary of Parent (“Merger
Sub”), and the Company are entering into an Agreement and Plan of Merger
(the “Merger Agreement”), dated as of the date hereof, pursuant to which
(i) Merger Sub will commence a cash tender offer (the “Offer”) to
purchase all of the issued and outstanding shares of common stock of the Company
(“Common Stock”) and (ii) following the consummation of the Offer, Merger
Sub will merge with and into the Company with the Company surviving as a wholly
owned subsidiary of Parent (the “Merger”);
Whereas,
concurrently with the
execution of the Merger Agreement, Parent, Merger Sub, the Company and Xx.
Xxxxxxx Xxxxxxxx are entering into a share tender agreement, dated as of the
date hereof (the “Tender Agreement”), pursuant to which Xx. Xxxxxxxx will
tender his shares of Common Stock in the Offer;
Whereas,
pursuant to resolutions
adopted on September 10, 2007 (the “Board Resolutions”), the Board of Directors
of the Company has approved the Merger Agreement and the Tender
Agreement;
Whereas,
Section 27(a) of the Agreement
provides that prior to the Distribution Date, and subject to the to the
penultimate sentence of such Section 27(a) of the Agreement, the Rights Agent
shall, if the Company so directs, supplement or amend any provision of the
Agreement without the approval of any holders of certificates representing
shares of Common Stock;
Whereas,
no Distribution Date has
occurred and no person is an Acquiring Person; and
Whereas,
pursuant to the Board
Resolutions, the Board of Directors of the Company has unanimously determined
that an amendment to the Agreement as set forth herein is necessary and
desirable in connection with the Merger Agreement, the Tender Agreement and
the
transactions contemplated by the Merger Agreement (including the Offer and
the
Merger) and the Tender Agreement, and the Company and the Rights Agent desire
to
evidence such amendment in writing.
Now,
Therefore, in accordance with the
procedures for amendment of the Agreement set forth in Section 27 thereof,
and
in consideration of the foregoing and the
mutual
agreements herein set forth and for other good and valuable consideration,
the
parties hereto hereby agree as follows:
1. Amendment
of the Agreement.
(a) Section
1 of the Agreement is hereby amended and supplemented to add the following
definitions in the appropriate locations:
“Redcats”
shall mean Redcats USA, Inc., a Delaware corporation, or any of its
subsidiaries, including Merger Sub.
“Merger”
shall mean the “Merger” as such term is defined in the Merger
Agreement.
“Merger
Agreement” shall mean the Agreement and Plan of Merger, dated as of September
10, 2007, by and among the Company, Redcats and Merger Sub, as it may be amended
from time to time.
“Merger
Sub” shall mean Boulevard Merger Sub, Inc., a newly formed Delaware corporation
and wholly owned subsidiary of Redcats.
“Offer”
shall mean the “Offer” as such term is defined in the Merger
Agreement.
“Tender
Agreement” shall mean the Tender Agreement, by and among the Company, Redcats,
Merger Sub and Xxxxxxx Xxxxxxxx, dated as of September 10, 2007, as it may
be
amended from time to time.
(b) The
definition of Acquiring Person in Section 1 of the Agreement is hereby amended
and supplemented by adding the following sentence at the end
thereof:
“Notwithstanding
anything in this Agreement to the contrary, none of Redcats, Merger Sub or
their
Affiliates or Associates shall be, or shall be deemed to be, an Acquiring Person
for purposes of this Agreement by virtue of one or more of (i) the approval,
execution or delivery of the Merger Agreement or the Tender Agreement, (ii)
the
public or other announcement of the Merger Agreement, the Tender Agreement,
or
any transaction contemplated by or arising in connection with the Merger
Agreement (including the Offer and the Merger) or the Tender Agreement, or
(iii)
the consummation of the Offer, the Merger, or any transaction contemplated
by or
arising in connection with the Merger Agreement (including the Offer and the
Merger) or the Tender Agreement (each such event and any combination of such
events, an “Exempt Event”)”
(c) The
definition of Section 11(a)(ii) Event in Section 1 of the Agreement is hereby
amended and supplemented by adding the following proviso immediately following
the words “Section 11(a)(ii) hereof”:
“;
provided, however, that notwithstanding anything in this Agreement to the
contrary, in no event shall any Exempt Event be, or deemed to be, or result
in,
a Section 11(a)(ii) Event.”
(d) The
definition of Section 13 Event in Section 1 of the Agreement is hereby amended
and supplemented by adding the following proviso immediately following the
words
“Section 13(a) hereof”:
“;
provided, however, that notwithstanding anything in this Agreement
to the contrary, in no event shall any Exempt Event be, or deemed to be, or
result in, a Section 13 Event.”
(e) The
definition of Stock Acquisition Date in Section 1 of the Agreement is hereby
amended and supplemented by adding the following proviso immediately following
the words “has become an Acquiring Person”:
“;
provided, however, that notwithstanding anything in this Agreement
to the contrary, a Stock Acquisition Date has not occurred and shall not be
deemed to have occurred as the result of an Exempt Event.”
(f) Section
3(a) of the Agreement is hereby amended and supplemented by adding the following
proviso immediately following the words “the earliest of (i), (ii) and (iii)
being herein referred to as the “Distribution Date”” in the fifth parenthetical
of Section 3(a):
“;
provided, however, that notwithstanding anything in this Agreement
to the contrary, a Distribution Date has not occurred and shall not be deemed
to
have occurred as the result of an Exempt Event.”
(g) Section
3 of the Agreement is hereby amended and supplemented to add the following
Section 3(d):
“(d)
Nothing in this Agreement shall be construed to give any holder of Rights or
any
other Person any legal or equitable rights, remedies or claims under this
Agreement by virtue of an Exempt Event.”
(h) Section
11(a) of the Agreement is hereby amended and supplemented to add the following
clause at the end thereof as Section 11(a)(iv):
“(iv)
Notwithstanding anything in this Agreement to the contrary, in no event shall
any Exempt Event be, or deemed to be, or result in, a Section 11(a)(ii) Event,
and this Section 11(a) shall not apply to any Exempt Event.”
(i) Section
13 of the Agreement is hereby amended and supplemented to add the following
clause at the end thereof as Section 13(f):
“(f)
Notwithstanding anything in this Agreement to the contrary, in no event shall
any Exempt Event be, or deemed to be, or result in, a Section 13 Event, and
this
Section 13 shall not apply to any Exempt Event.”
(j) Section
23 of the Agreement is hereby amended and supplemented to add the following
Section 23(c):
“(c)
Notwithstanding anything herein to the contrary, immediately prior to the
Effective Time (as defined in the Merger Agreement), this Agreement shall
terminate and shall have no further force and effect and the Rights shall expire
and become null and void, without any payment, liability or obligation on the
part of the Company, the Rights Agent or the holders of any
Rights.”
2. Governing
Law. This Amendment 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.
3. Execution
in Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall be an original and all of which together
shall
constitute one instrument.
4. Effectiveness. This
Amendment shall be deemed effective as of, and immediately prior to, the
execution and delivery of the Merger Agreement. Except as amended
hereby, the Agreement shall remain in full force and effect and shall be
otherwise unaffected hereby. If for any reason the Merger Agreement
is terminated in accordance with its terms, then this Amendment shall become
null and void and be of no further force and effect and the Agreement shall
remain exactly the same as it existed immediately prior to the execution of
this
Amendment.
5. Severability. If
any term, provision, covenant or restrictions of this Amendment is held by
a
court of competent jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Amendment shall remain in full force and effect and shall
in no way be affected, impaired or invalidated.
[signature
page follows]
In
Witness Whereof, the parties hereto
have caused this Amendment to be duly executed as of the day and year first
above written.
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UNITED
RETAIL GROUP, INC.
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By:
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/s/ Xxxxxxx Xxxxxxxx | ||
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Name:
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Xxxxxxx Xxxxxxxx | ||
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Title:
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Chairman, President and | ||
| Chief Executive Officer | |||
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CONTINENTAL
STOCK TRANSFER & TRUST COMPANY
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By:
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/s/ Xxxx X. Xxxxxxx | ||
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Name:
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Xxxx X. Xxxxxxx | ||
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Title:
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Vice President | ||
