EXHIBIT 10.1
NEW MIL BANCORP, INC.
and
AMERICAN STOCK TRANSFER & TRUST COMPANY
as Rights Agent
RIGHTS AGREEMENT
Dated as of July 19, 1994
INDEX
Page
Section 1. Certain Definitions
Section 2. Appointment of Rights Agent
Section 3. Issue of Right Certificates
Section 4. Form of Right Certificates
Section 5. Countersignature and registration
Section 6. Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen Right
Certificates
Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights
Section 8. Cancellation and Destruction of Right Certificates
Section 9. Reservation and Availability of Capital Stock
Section 10. Common Stock Record Date
Section 11. Adjustment of Purchase Price, Number and Kind of Shares or
Number of Rights
Section 12. Certificate of Adjusted Purchase Price or Number of Shares
Section 13. Consolidation, Merger or Sale or Transfer of Assets or
Earning Power
Section 14. Fractional Rights and Fractional Shares
Section 15. Rights of Action
Section 16. Agreement of Right Holders
Section 17. Right Certificate Holder Not Deemed a Stockholder
Section 18. Concerning the Rights Agent
Section 19. Merger or Consolidation or Change of Name of Rights Agent
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Section 20. Duties of Rights Agent
Section 21. Change of Rights Agent
Section 22. Issuance of New Right Certificates
Section 23. Redemption
Section 24. Notice of Proposed Actions
Section 25. Notices
Section 26. Supplements and Amendments
Section 27. Successors
Section 28. Determinations and Actions by the Board of Directors, etc
Section 29. Benefits of This Agreement
Section 30. Severability
Section 31. Governing Law
Section 32. Counterparts
Section 33. Descriptive Headings
Testimonium and Signatures
Exhibit A - Form of Right Certificate
Exhibit B - Summary of Rights to Purchase Common Shares
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DRAFT
July 14, 1994
RIGHTS AGREEMENT
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This Rights Agreement dated as of July 19, 1994, between NEW MIL BANCORP,
INC., a Delaware corporation (the "Company"), and AMERICAN STOCK TRANSFER &
TRUST COMPANY, as Rights Agent (the "Rights Agent"),
W I T N E S S E T H:
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WHEREAS, on July 19, 1994 the Board of Directors of the Company authorized
and declared a dividend distribution of one Right (hereafter referred to as a
"Right") for each five outstanding shares of the Common Stock, par value $.50
per share, of the Company (the "Common Stock") outstanding at the close of
business on July 19, 1994 (hereinafter referred to as the "Record Date") (other
than shares of such Common Stock held in the Company's treasury on such date)
and has authorized the issuance of one Right (as such number may hereafter be
adjusted pursuant to the provisions of Section 11(p) hereof) in respect of each
five shares of Common Stock of the Company that shall become outstanding after
the Record Date (whether originally issued or delivered from the Company's
treasury) and on or prior to the earlier of the Distribution Date and the
Expiration Date (as such terms are hereinafter defined), each Right representing
the right to purchase one share of the Company's Common Stock upon the terms and
subject to the conditions hereinafter set forth (the "Rights");
NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein set forth, the parties hereby agree as follows:
Section 1. Certain Definitions. For purposes of this Agreement, the
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following terms have the meanings indicated;
(a) "Acquiring Person" shall mean any Person (as hereinafter defined)
who or which, together with all Affiliates (as hereinafter defined) and
Associates (as hereinafter defined) of such Person, shall be the Beneficial
Owner (as hereinafter defined) of 10% or more of the shares of Common Stock
then outstanding, but shall not include the Company, any Subsidiary (as
hereinafter defined) of the Company, any employee benefit plan of the
Company or any
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Subsidiary of the Company, or any entity (including its Affiliates)
organized, appointed or established for or pursuant to the terms of any
such plan acting solely in its capacity (or their capacities) under such
plan. Notwithstanding the foregoing, no Person shall become an "Acquiring
Person" solely as the result of an acquisition of Common Stock by the
Company which, by reducing the number of shares outstanding, increases the
proportionate number of shares beneficially owned by such Person to 10% or
more of the shares of Common Stock then outstanding; provided however, that
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if a Person becomes the Beneficial Owner of 10% or more of the shares of
Common Stock then outstanding by reason of share acquisitions by the
Company and shall, after such acquisitions, become the Beneficial Owner of
any additional shares of Common Stock, then such Person shall be deemed to
be an "Acquiring Person."
(b) "Affiliate", "Associate" and "Control" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), as in effect on the date hereof.
(c) A Person shall be deemed the "Beneficial Owner" of, and shall be
deemed to "beneficially own", any securities:
(i) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, beneficially owns (as determined
pursuant to Rule 13d-3 of the General Rules and Regulations under the
Exchange Act as in effect on the date of this Agreement) or has the
right to dispose of;
(ii) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has (A) the right to acquire
(whether such right is exercisable immediately or only after the
passage of time) pursuant to any agreement, arrangement or
understanding (whether or not in writing), or upon the exercise of
conversion rights, exchange rights, rights (other than the Rights),
warrants or options, or otherwise; provided, however, that a Person
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shall not be deemed the "Beneficial Owner" of or to "beneficially own"
securities tendered pursuant to a tender or exchange offer made by or
on behalf of such Person or any of such Person's Affiliates or
Associates until such tendered securities are accepted for payment or
exchange; or (B) the right to vote,
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including pursuant to any agreement, arrangement or understanding
(whether or not in writing); provided, however, that a Person shall
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not be deemed the "Beneficial Owner" of or to "beneficially own" any
security under this clause (B) as a result of an agreement,
arrangement or understanding to vote such security if such agreement,
arrangement or understanding (1) arises solely from a revocable proxy
given in response to a public proxy solicitation made pursuant to, and
in accordance with, the applicable rules and regulations under the
Exchange Act and (2) is not also then reportable by such Person on
Schedule 13D under the Exchange Act (or any comparable or successor
report); or
(iii) which are beneficially owned, directly or indirectly, by
any other Person (or any Affiliate or Associate thereof) with which
such Person or any of such Person's Affiliates or Associates has any
agreement, arrangement or understanding (whether or not in writing)
for the purpose of acquiring, holding, voting (except pursuant to a
revocable proxy as described in clause (B) of subparagraph (ii) of
this paragraph (c)) or disposing of any voting securities of the
Company.
(d) "Business Day" shall mean any day other than a Saturday, Sunday,
or a day on which banking institutions in the State of Connecticut are
authorized or obligated by law or executive order to close.
(e) "Close of business" on any given date shall mean 5:00 P.M.,
Eastern time, on such date; provided, however, that if such date is not a
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Business Day it shall mean 5:00 P.M., Eastern time, on the next succeeding
Business Day.
(f) "Common Stock" shall mean the Common Stock, par value $.50 per
share, of the Company, except that "Common Stock" when used with reference
to any Person other than the Company shall mean the capital stock of such
Person with the greatest voting power, or the equity securities or other
equity interest having power to control or direct the management, of such
Person.
(g) "Common Stock Equivalent" shall mean a share, or depositary
receipt exchangeable for a fraction of a share, of any authorized class or
series of preferred stock of the Company having dividend, voting,
liquidation and other rights which result, in the judgment of the Board of
Directors, in
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such share, or depositary receipt, being approximately equivalent in value
to one share of Common Stock as of the date of occurrence of a Section II
(a) (ii) Event (as such term is hereinafter defined) (the "Event Date");
provided, however, that, if there is no authorized class or series of
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preferred stock of the Company or if in the judgment of the Board of
Directors there are not sufficient authorized but unissued shares of
preferred stock available for the creation of Common Stock Equivalents,
"Common Stock Equivalent" shall mean such cash, reduction in Purchase Price
(as such term is hereinafter defined), other equity securities, debt
securities, other assets or any combination of the foregoing, that the
Board of Directors shall determine to be approximately equivalent in value
to one share of Common Stock as of the Event Date.
(h) "Continuing Director" shall mean (i) any member of the Board of
Directors of the Company, while such Person is a member of the Board, who
is not an Acquiring Person or an Affiliate or Associate of an Acquiring
Person or a representative or nominee of an Acquiring Person or of any such
Affiliate or Associate and was a member of the Board prior to the time any
Person becomes an Acquiring Person, and (ii) any Person who subsequently
becomes a member of the Board, while such Person is a member of the Board,
who is not an Acquiring Person or an Affiliate or Associate of an Acquiring
Person or a representative or nominee of an Acquiring Person or of any such
Affiliate or Associate, if such Person's nomination for election or
election to the Board is recommended or approved by a majority of the
Continuing Directors.
(i) "Distribution Date" shall have the meaning defined in Section 3
hereof.
(j) "Exchange" and "Exchange Ratio" shall have the respective meanings
defined in Section 25 hereof.
(k) "Exchange Date" shall have the meaning defined in Section 7(a)
hereof.
(l) "Person" shall mean any individual, firm, limited liability
company, corporation, partnership or other entity.
(m) "Purchase Price" shall have the meaning defined in Section 4
hereof.
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(n) "Section 11(a) (ii) Event" shall mean the event described in
Section 11(a) (ii).
(o) "Stock Acquisition Date" shall mean the first date of public
announcement (which, for purposes of this definition, shall include,
without limitation, the filing of a report pursuant to Section 13(d) under
the Exchange Act or pursuant to a comparable successor statute) by the
Company or an Acquiring Person indicating that an Acquiring Person has
become such.
(p) "Subsidiary" of any Person shall mean any other Person of which
securities or other ownership interests having ordinary voting power, in
the absence of contingencies, to elect a majority of the board of directors
or other Persons performing similar functions as a board of directors are
at the time directly or indirectly owned by such first Person, or which is
otherwise controlled by such first Person.
(q) "Trading Day" shall have the meaning defined in Section 11(d)
hereof.
(r) "Triggering Event" shall mean any Section 11(a) (ii) Event or any
event described in Section 13(a)(i), (ii) or (iii) hereof.
Section 2. Appointment of Rights Agent. The Company hereby appoints the
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Rights Agent to act as agent for the Company and the holders of the Rights (who,
in accordance with Section 3 hereof, shall prior to the Distribution Date also
be the holders of the Common Stock) in accordance with the terms and conditions
hereof, and the Rights Agent hereby accepts such appointment. The Company may
from time to time appoint such Co-Rights Agents as it may deem necessary or
desirable. In the event the Company appoints one or more Co-Rights Agents, the
respective duties of the Rights Agent and any Co-Rights Agents shall be as the
Company shall determine.
Section 3. Issue of Right Certificates.
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(a) Until the earliest of (i) the close of business on the tenth day
after the Stock Acquisition Date (or, if the tenth business day after the
Stock Acquisition Date occurs before the Record Date, the close of business
on the Record Date); or (ii) the close of business on the tenth Business
Day after the date of the commencement of a tender or exchange
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offer by any Person if, upon consummation thereof, such Person would be an
Acquiring Person (including any such date which is after the date of this
Agreement and prior to the issuance of the Rights; or (iii) the tenth day
(or such later day as may be determined by action of the Board of Directors
of the Company prior to such time as any person becomes an Acquiring
Person) after the filing by any Person (other than the Company) of a
registration statement under the Securities Act of 1933, as amended, with
respect to a contemplated exchange offer to acquire (when added to any
shares as to which such person is the beneficial owner immediately prior to
such filing) beneficial ownership of 10% or more of the issued and
outstanding shares of Common Stock; the earliest of such dates being herein
referred to as the "Distribution Date"), (x) the Rights will be evidenced
(subject to the provisions of paragraph (b) of this Section 3) by the
certificates for the Common Stock registered in the names of the holders of
the Common Stock (which certificates for Common Stock shall be deemed also
to be Right Certificates) and not by separate Right Certificates, and (y)
the Rights will be transferable only in connection with the transfer of the
underlying shares of Common Stock. As soon as practicable after the Company
has notified the Rights Agent of the occurrence of the Distribution Date,
the Rights Agent will send, by first-class, insured, postage prepaid mail,
to each record holder of the Common Stock as of the close of business on
the Distribution Date, at the address of such holder shown on the records
of the Company, one or more right certificates, in substantially the form
of Exhibit A hereto (the "Right Certificates"), evidencing one Right for
each five full shares of Common Stock so held, subject to adjustment as
provided herein. In the event that an adjustment in the number of Rights
per share of Common Stock has been made pursuant to Section 11(p) hereof,
at the time of distribution of the Right Certificates, the Company shall
make the necessary and appropriate rounding adjustments (in accordance with
Section 14(a) hereof) so that the Right Certificates representing only
whole numbers of Rights are distributed and cash is paid in lieu of any
fractional Rights. As of and after the Distribution Date, the Rights will
be evidenced solely by such Right Certificates.
(b) As soon as practicable after the Record Date, the Company will
send a copy of a Summary of Rights to Purchase Common Stock, in
substantially the form of Exhibit B hereto (the "Summary of Rights"), by
first-class, postage prepaid mail, to each record holder of the Common
Stock as of the close of business on the Record Date at the address of such
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holder shown on the records of the Company. With respect to certificates
for the Common Stock outstanding as of the Record Date, until the
Distribution Date (or the earlier redemption, exchange or expiration of the
Rights), the Rights will be evidenced by such certificates for the Common
Stock registered in the names of the holders of the Common Stock together
with a copy of the Summary of Rights, and the registered holders of the
Common Stock shall also be registered holders of the associated Rights.
Until the Distribution Date (or the earlier redemption, exchange or
expiration of the Rights), the transfer of any of the certificates for the
Common Stock outstanding as of the Record Date with or without a copy of
the Summary of Rights attached thereto, shall also constitute the transfer
of the Rights associated with the Common Stock represented by such
certificates.
(c) Rights shall be issued in respect of all shares of Common Stock
which become outstanding after the Record Date but on or prior to the
Distribution Date (or the earlier redemption, exchange or expiration of the
Rights). Certificates representative of such shares of Common Stock shall
be deemed also to be certificates for Rights and shall have impressed on,
printed on, written on or otherwise affixed to them the following legend:
This certificate also evidences and entitles the holder hereof to
certain Rights as set forth in a Rights Agreement between New Mil
Bancorp, Inc. and American Stock Transfer & Trust Company dated as of
July 19, 1994 (the "Rights Agreement"), the terms of which are hereby
incorporated herein by reference and a copy of which is on file at the
principal executive offices of the Company. Under certain
circumstances, as set forth in the Rights Agreement, such Rights will
be evidenced by separate certificates and will no longer be evidenced
by this certificate. The Company will mail to the holder of this
certificate a copy of the Rights Agreement without charge promptly
after receipt of a written request therefor. As described in the
Rights Agreement, Rights beneficially owned by (i) an Acquiring Person
or any Associate or Affiliate thereof (as such terms are defined in
the Rights Agreement), (ii) a transferee of an Acquiring Person (or of
any such Affiliate) who becomes a transferee after the Acquiring
Person becomes such is designated as such or (iii) under certain
circumstances, a transferee of an Acquiring Person (or of any such
Affiliate) who becomes a transferee before or concurrently with the
Acquiring Person becoming such,
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shall become null and void.
With respect to such certificates containing the foregoing legend, until
the Distribution Date (or the earlier redemption, exchange or expiration of the
Rights) the Rights associated with the Common Stock represented by such
certificates shall be evidenced by such certificates alone, and the transfer of
any of such certificates shall also constitute the transfer of the Rights
associated with the Common Stock represented by such certificates.
Section 4. Form of Right Certificates. The Right Certificates (and the
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forms of election to purchase and of assignment and the certificates to be
printed on the reverse thereof) shall be substantially in the form of Exhibit B
hereto and may have such marks of identification or designation and such
legends, summaries or endorsements printed thereon as the Company may deem
appropriate and as are not inconsistent with the provisions of this Agreement,
or as may be required to comply with any applicable law, rule or regulation or
with any rule or regulation of any stock exchange on which the Rights may from
time to time be listed, or to conform to usage. Subject to the provisions of
Section 11 and Section 22 hereof, the Right Certificates, whenever distributed,
shall be dated as of the Record Date and on their face shall entitle the holders
thereof to purchase such number of shares of Common Stock as shall be set forth
therein at the price set forth therein (such exercise price per share, the
"Purchase Price"), but the amount and type of securities purchasable upon the
exercise of each Right and the Purchase Price thereof shall be subject to
adjustment as provided herein.
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Section 5. Countersignature and Registration.
---------------------------------
(a) The Right Certificates shall be executed on behalf of the Company
by its Chairman of the Board, its President or any Vice President, either
manually or by facsimile signature, and shall have affixed thereto the
Company's seal or a facsimile thereof which shall be attested by the
Secretary or an Assistant Secretary of the Company, either manually or by
facsimile signature. The Right Certificates shall be manually countersigned
by the Rights Agent and shall not be valid for any purpose unless so
countersigned. In case any officer of the Company whose manual or facsimile
signature is affixed to the Right Certificates shall cease to be such
officer of the Company before countersignature by the Rights Agent and
issuance and delivery by the Company, such Right Certificates,
nevertheless, may be countersigned by the Rights Agent, issued and
delivered with the same force and effect as though the Person who signed
such Right Certificates had not ceased to be such officer of the Company.
Any Right Certificate may be signed on behalf of the Company by any Person
who, at the actual date of the execution of such Right Certificate, shall
be a proper officer of the Company to sign such Right Certificate, although
at the date of the execution of this Rights Agreement any such Person was
not such an officer.
(b) Following the Distribution Date, the Rights Agent will keep or
cause to be kept, at its principal office or offices designated as the
appropriate place for surrender of Right Certificates upon exercise or
transfer, books for registration and transfer of the Right Certificates
issued hereunder. Such books shall show the names and addresses of the
respective holders of the Right Certificates, the number of Rights
evidenced on its face by each of the Right Certificates, the certificate
number of each of the Right Certificates and the date of each of the Right
Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of Right
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Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates.
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(a) Subject to the provisions of Section 7(e) and Section 14 hereof,
at any time after the close of business on the Distribution Date, and at or
prior to the close of business on the Expiration Date (as such term is
defined in Section 7(a) hereof ), any Right Certificate or Right
Certificates may be transferred, split up, combined or
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exchanged for another Right Certificate or Right Certificates, entitling
the registered holder to purchase a like number of shares of Common Stock
(or, following a Triggering Event, Common Stock, other securities, cash or
assets, as the case may be) as the Right Certificate or Right Certificates
surrendered then entitled such holder (or former holder in the case of a
transfer) to purchase. Any registered holder desiring to transfer, split
up, combine or exchange any Right Certificate or Certificates shall make
such request in writing delivered to the Rights Agent, and shall surrender
the Right Certificate or Right Certificates to be transferred, split up,
combined or exchanged at the principal office or offices of the Rights
Agent designated for such purpose. Neither the Rights Agent nor the Company
shall be obligated to take any action whatsoever with respect to the
transfer of any such surrendered Right Certificate until the registered
holder shall have completed and signed the certificate contained in the
form of assignment on the reverse side of such Right Certificate and shall
have provided such additional evidence of the identity of the Beneficial
Owner (or former Beneficial Owner) or Affiliates or Associates thereof as
the Company shall reasonably request. Thereupon the Rights Agent shall,
subject to Section 7(e) and Section 14 hereof, countersign and deliver to
the Person entitled thereto a Right Certificate or Right Certificates, as
the case may be, as so requested. The Company may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer, split up, combination or exchange of Right
Certificates.
(b) Upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction or
mutilation of a Right Certificate, and, in case of loss, theft or
destruction, of indemnity or security reasonably satisfactory to them, and,
at the Company's request, reimbursement to the Company and the Rights Agent
of all reasonable expenses incidental thereto, and upon surrender to the
Rights Agent and cancellation of the Right Certificate if mutilated, the
Company will make and deliver a new Right Certificate of like tenor to the
Rights Agent for countersignature and delivery to the registered owner in
lieu of the Right Certificate so lost, stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price; Expiration of Rights.
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(a) The Rights shall not be exercisable prior to the Distribution
Date. Subject to Section 7(e) hereof, the registered holder of any Right
Certificate may exercise the Rights evidenced thereby (except as otherwise
provided herein including, without limitation, the restrictions on
exercisability set forth in Section 9(c), Section 11(a) (iii) and Section
23(a) hereof) in whole or in part at any time after the Distribution Date
upon surrender of the Right Certificate, with the form of election to
purchase and the certificate on the reverse side thereof duly executed, to
the Rights Agent at the principal office or offices of the Rights Agent
designated for such purpose, together with payment of the aggregate
Purchase Price with respect to the total number of shares of Common Stock
(or other securities or property, as the case may be) as to which such
surrendered Rights are then exercisable, at or prior to the earliest of (i)
the close of business on July 18, 2004 (the "Final Expiration Date"), (ii)
the time at which the Rights are redeemed as provided in Section 23 hereof
or (iii) the time at which the Rights are exchanged as provided in Section
24 hereof (the "Exchange Date") (the earliest of (i), (ii) and (iii) being
herein referred to as the "Expiration Date").
(b) The Purchase Price for each share of Common Stock pursuant to the
exercise of a Right shall initially be $20, shall be subject to adjustment
from time to time as provided in Section 11 and Section 13(a) hereof and
shall be payable in lawful money of the United States of America in
accordance with paragraph (c) below.
(c) Upon receipt of a Right Certificate representing exercisable
Rights, with the form of election to purchase and the certificate duly
executed, accompanied by payment, with respect to each Right so exercised,
of the Purchase Price per share of Common Stock (or other shares,
securities or property, as the case may be) to be purchased, and an amount
equal to any applicable transfer tax, in cash, or in the form of a
certified check or money order payment to the order of the Company, the
Rights Agent shall, subject to Section 20(k) hereof, thereupon promptly (i)
requisition from any transfer agent of the Common Stock (or make available,
if the Rights Agent is the transfer agent therefor) certificates for the
total number of shares of Common Stock to be purchased and the Company
hereby irrevocably authorizes its transfer agent to comply with all such
requests, (ii) requisition from the Company the amount of cash, if any, to
be paid in lieu of
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issuance of fractional shares in accordance with Section 14 hereof, (iii)
promptly after receipt of such certificates cause the same to be delivered
to or upon the order of the registered holder of such Right Certificate,
registered in such name or names as may be designated by such holder and
(iv) after receipt thereof, promptly deliver such cash, if any, to or upon
the order of the registered holder of such Right Certificate. In the event
that the Company is obligated to issue other securities of the Company, pay
cash and/or distribute other property pursuant to Section 11(a) hereof, the
Company will make all arrangements necessary so that such other securities,
cash and/or other property are available for distribution by the Rights
Agent, if and when appropriate.
(d) In case the registered holder of any Right Certificate shall
exercise less than all the Rights evidenced thereby, a new Right
Certificate evidencing Rights equivalent to the Rights remaining
unexercised shall be issued by the Rights Agent and delivered to, or upon
the order of, the registered holder of such Right Certificate, registered
in such name or names as may be designated by such holder, subject to the
provisions of Section 14 hereof.
(e) Notwithstanding anything in this Agreement to the contrary, from
and after the first occurrence of a Section 11(a)(ii) Event, any Rights
beneficially owned by (i) an Acquiring Person or an Associate or Affiliate
of an Acquiring Person, (ii) a transferee of an Acquiring Person (or of any
such Associate or Affiliate) who becomes a transferee after the Acquiring
Person becomes such or (iii) a transferee of an Acquiring Person (or of any
such Associate or Affiliate) who becomes a transferee prior to or
concurrently with the Acquiring Person becoming such and receives such
Rights pursuant to either (A) a transfer (whether or not for consideration)
from the Acquiring Person (or from any such Associate or Affiliate) to
holders of equity interests in such Acquiring Person (or in any such
Associate or Affiliate) or to any Person with whom the Acquiring Person (or
any such Associate or Affiliate) has any continuing agreement, arrangement
or understanding regarding the transferred Rights or (B) a transfer which
the Board of Directors of the Company has determined (whether before or
after such transfer) is part of a plan, arrangement or understanding which
has as a primary purpose or effect the avoidance of this Section 7(e),
shall become null and void without any further action and no holder of such
Rights shall have any rights whatsoever with respect to such Rights,
whether under any provision of this Agreement
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or otherwise. No Right Certificate shall be issued pursuant to Section 3
hereof that represents Rights beneficially owned by an Acquiring Person or
any Associate or Affiliate thereof and no Right Certificate shall be issued
at any time upon the transfer of any Rights to an Acquiring Person or any
Affiliate or Associate thereof or to any nominee of such Acquiring Person,
Associate or Affiliate. Any Right Certificate delivered to the Rights Agent
for transfer to any of the foregoing Persons, or which represents void
Rights, shall be canceled. The Company shall use all reasonable efforts to
insure that the provisions of this Section 7(e) are complied with, but
shall have no liability to any holder of Right Certificates or other Person
as a result of its failure to make any determinations with respect to an
Acquiring Person or its Affiliates and Associates or any transferee of any
of them hereunder.
(f) Notwithstanding anything in this Agreement to the contrary,
neither the Rights Agent nor the Company shall be obligated to undertake
any action with respect to a registered holder of Rights upon the
occurrence of any purported transfer as set forth in Section 6 hereof or
exercise as set forth in this Section 7 unless such registered holder shall
have (i) completed and signed the certificate contained in the form of
election to purchase set forth on the reverse side of the Right Certificate
surrendered for such exercise and (ii) provided such additional evidence of
the identity of the Beneficial Owner (or former Beneficial Owner) or
Affiliates or Associates thereof as the Company shall reasonably request.
Section 8. Cancellation and Destruction of Right Certificates. All Right
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Certificates surrendered for the purpose of exercise, transfer, split up,
combination or exchange shall, if surrendered to the Company or to any of its
agents, be delivered to the Rights Agent for cancellation or in canceled form,
or, if surrendered to the Rights Agent, shall be canceled by it, and no Right
Certificates shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Agreement. The Company shall deliver to the Rights
Agent for cancellation and retirement, and the Rights Agent shall so cancel and
retire, any other Right Certificate purchased or acquired by the Company
otherwise than upon the exercise thereof. The Rights Agent shall deliver all
canceled Right Certificates to the Company, or shall, at the written request of
the Company, destroy such canceled Right Certificates, and in such case shall
deliver a certificate of destruction thereof to the Company.
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Section 9. Reservation and Availability of Capital Stock.
---------------------------------------------
(a) The Company covenants and agrees that it will cause to be reserved
and kept available out of its currently authorized and unissued shares of
Common Stock the number of shares of Common Stock that, as provided in this
Agreement, including Section 11(a) (iii) hereof, will be sufficient to
permit to the maximum extent possible the exercise of all outstanding
Rights.
(b) So long as the Common Stock issuable and deliverable upon the
exercise of Rights may be listed on any national securities exchange, the
Company shall use its best efforts to cause, from and after such time as
the Rights become exercisable, all shares reserved for such issuance to be
listed on such exchange upon official notice of issuance upon such
exercise.
(c) The Company shall use its best efforts to (i) file, as soon as
practicable following the earliest date after the occurrence of a Section
11(a)(ii) Event as of which the consideration to be delivered by the
Company upon exercise of the Rights has been determined in accordance with
Section 11(a)(ii) or Section 11(a)(iii) hereof, or as soon as is required
by law following the Distribution Date, as the case may be, a registration
statement under the Securities Act of 1933, as amended (the "Act"), with
respect to the securities purchasable upon exercise of the Rights on an
appropriate form, (ii) cause such registration statement to become
effective as soon as practicable after such filing and (iii) cause such
registration statement to remain effective (with a prospectus at all times
meeting the requirements of the Act) until the earlier of (A) the date as
of which the Rights are no longer exercisable for such securities and (B)
the Expiration Date. The Company will also take such action as may be
appropriate under, or to ensure compliance with, the securities or "blue
sky" laws of the various states in connection with the exercisability of
the Rights. The Company may temporarily suspend, for a period of time not
to exceed 90 days after the date set forth in clause (i) of the first
sentence of this Section 9(c), the exercisability of the Rights in order to
prepare and file such registration statement and permit it to become
effective. Upon any such suspension, the Company shall issue a public
announcement stating that the exercisability of the Rights has been
-14-
temporarily suspended, as well as a public announcement at such time as the
suspension is no longer in effect. Notwithstanding any such provision of
this Agreement to the contrary, the Rights shall not be exercisable in any
jurisdiction if the requisite qualification in such jurisdiction shall not
have been obtained, the exercise thereof shall not be permitted under
applicable law or a registration statement shall not have been declared
effective. Nothing herein shall require the Company to bear the expense of
obtaining registration if the cost of such registration in a particular
jurisdiction presents an unreasonable burden on the Company under the
circumstances.
(d) The Company covenants and agrees that it will take all such action
as may be necessary to insure that all shares of Common Stock delivered
upon exercise of Rights shall, at the time of delivery of the certificates
for such shares (subject to payment of the Purchase Price), be duly and
validly authorized and issued and fully paid and nonassessable.
(e) The Company further covenants and agrees that it will pay when due
and payable any and all federal and state transfer taxes and charges which
may be payable in respect of the issuance or delivery of the Right
Certificates and of any certificates for shares of Common Stock upon the
exercise of Rights. The Company shall not, however, be required to pay any
transfer tax which may be payable in respect of any transfer involved in
the transfer or delivery of Right Certificates to a Person other than, or
the issuance or delivery of Common Stock in respect of a name other than
that of, the registered holder of the Right Certificate evidencing Rights
surrendered for exercise or to issue or deliver any certificates for Common
Stock in a name other than that of the registered holder upon the exercise
of any Rights until any such tax shall have been paid (any such tax being
payable by the holder of such Right Certificate at the time of surrender)
or until it has been established to the Company's satisfaction that no such
tax is due.
Section 10. Common Stock Record Date. Each Person in whose name any
------------------------
certificate for a share of Common Stock is issued upon the exercise of Rights
shall for all purposes be deemed to have become the holder of record of such
shares of Common Stock represented thereby on, and such certificate shall be
dated, the date upon which the Right Certificate evidencing such Rights was duly
-15-
surrendered and payment of the Purchase Price (and any applicable transfer
taxes) was made; provided, however, that if the date of such surrender and
-----------------
payment is a date upon which the Common 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 Common Stock transfer books of the Company are open. Prior to the
exercise of the Rights evidenced thereby, the holder of a Right Certificate
shall not be entitled to any rights of a stockholder of the Company with respect
to shares for which the Rights shall be exercisable, including, without
limitation, the right to vote, to receive dividends or other distributions or to
exercise any preemptive rights, and shall not be entitled to receive any notice
of any proceedings of the Company, except as provided herein.
Section 11. Adjustment of Purchase Price. Number and Kind of Shares or
----------------------------------------------------------
Number of Rights. The Purchase Price, the number and kind of shares covered by
----------------
each Right and the number of Rights outstanding are subject to adjustment from
time to time as provided in this Section 11.
(a) (i) In the event the Company shall at any time after the date of
this Agreement (A) declare a dividend on the Common Stock payable in
shares of Common Stock, (B) subdivide the outstanding Common Stock,
(C) combine the outstanding Common Stock into a smaller number of
shares or (D) issue any shares of its capital stock in a
reclassification of the Common Stock (including any such
reclassification in connection with a consolidation or merger in which
the Company is the continuing or surviving corporation) except as
otherwise provided in this Section 11(a) and Section 7(e) hereof, the
Purchase Price in effect at the time of the record date for such
dividend or of the effective date of such subdivision, combination or
reclassification, and the number and kind of shares of Common Stock or
capital stock, as the case may be, issuable on such date, shall be
proportionately adjusted so that the holder of any Right exercised
after such time shall be entitled to receive, upon payment of the
Purchase Price then in effect, the aggregate number and kind of shares
of Common Stock or capital stock, as the case may be, which, if such
Right had been exercised immediately prior to such date and at a time
when the Common Stock transfer books of the Company were open, he
would have owned upon such exercise and been entitled to
-16-
receive by virtue of such dividend, subdivision, combination or
reclassification.
(ii) In the event that any Person, alone or together with its
Affiliates and Associates or otherwise, shall become an Acquiring
Person, then proper provision shall promptly be made so that each
holder of a Right, except as provided below and in Section 7(e)
hereof, shall thereafter have a right to receive, upon exercise
thereof at the then current Purchase Price multiplied by the number of
Shares of Common Stock for which a Right is then exercisable, in
accordance with the terms of this Agreement, such number of shares of
Common Stock of the Company as shall equal the result obtained by (x)
multiplying the then current Purchase Price by the number of Common
shares of Common Stock for which a Right is then exercisable and (y)
dividing that product by 25% of the current market price per share of
the Common Stock (determined pursuant to Section 11(d)) on the date of
the occurrence of the Section 11(a) (ii) Event.
(iii) In the event that the number of shares of Common Stock
which are authorized by the Company's certificate of incorporation but
not outstanding or reserved for issuance for purposes other than upon
exercise of the Rights is not sufficient to permit the exercise in
full of the Rights in accordance with the foregoing subparagraph (ii)
of this Section 11(a), proper provision shall promptly be made so that
each holder of a Right, except as provided in Section 7(e) hereof,
shall, in the discretion of the Company's Board of Directors,
thereafter have a right to receive, upon exercise thereof in
accordance with the terms of this Agreement such number of Common
Stock Equivalents or the maximum number of shares of Common Stock
available for issuance to such holder at a reduced Purchase Price
which reflects a per share Purchase Price of 25% of current market
value as determined pursuant to subparagraph (ii) above.
(b) In case the Company shall fix a record date for the issuance of
rights, options or warrants (other than the Rights) to all holders of
Common Stock entitling them to subscribe for or purchase (for a period
expiring within 45 calendar days after such record date) Common Stock (or
securities having the same rights, privileges and preferences as the shares
of Common Stock ("equivalent common stock")) or securities convertible into
Common Stock or equivalent common
-17-
stock at a price per share of Common Stock or per share of equivalent
common stock (or having a conversion or exercise price per share, if a
security convertible into or exercisable for Common Stock or equivalent
common stock) less than the current market price (as determined pursuant to
Section 11(d) hereof) per share of Common Stock on such record date, the
Purchase Price to be in effect after such record date shall be determined
by multiplying the Purchase Price in effect immediately prior to such date
by a fraction, the numerator of which shall be the number of shares of
Common Stock outstanding on such record date, plus the number of shares of
Common Stock which the aggregate offering price of the total number of
shares of Common Stock and/or equivalent common stock so to be offered
(and/or the aggregate initial conversion price of the convertible
securities so to be offered) would purchase at such current market price
and the denominator of which shall be the number of shares of Common Stock
outstanding on such record date plus the number of additional shares of
Common Stock and/or equivalent common stock to be offered for subscription
or purchase (or into which the convertible securities so to be offered are
initially convertible). In case such subscription price may be paid by
delivery of consideration part or all of which shall be in a form other
than cash, the value of such consideration shall be as determined in good
faith by the Board of Directors of the Company, whose determination shall
be described in a statement filed with the Rights Agent and shall be
binding on the Rights Agent and the holders of Rights. Shares of Common
Stock owned by or held for the account of the Company shall not be deemed
outstanding for the purpose of any such computation. Such adjustment shall
be made successively whenever such a record date is fixed; and in the event
that such rights or warrants are not so issued, the Purchase Price shall be
adjusted to be the Purchase Price which would then be in effect if such
record date had not been fixed.
(c) In case the Company shall fix a record date for the making of a
distribution to all holders of Common Stock (including any such
distribution made in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation) of evidences of
indebtedness, cash (other than a regular periodic cash dividend out of the
earnings or retained earnings of the Company), assets (other than a
dividend payable in Common Stock, but including any dividend payable in
stock other than Common Stock) or convertible securities, subscription
rights or warrants
-18-
(excluding those referred to in Section 11(b) hereof), the Purchase Price
to be in effect after such record date shall be determined by multiplying
the Purchase Price in effect immediately prior to such record date by a
fraction, the numerator of which shall be the current market price (as
determined pursuant to Section 11(d) hereof) per share of Common Stock on
such record date, less the fair market value (as determined in good faith
by the Board of Directors of the Company, whose determination shall be
described in a statement filed with the Rights Agent and shall be binding
on the Rights Agent and the holders of Rights) of the portion of the cash,
assets or evidences of indebtedness so to be distributed or of such
convertible securities, subscription rights or warrants applicable to one
share of Common Stock and the denominator of which shall be such current
market price (as determined pursuant to Section 11(d) hereof) per share of
Common Stock. Such adjustments shall be made successively whenever such a
record date is fixed; and in the event that such distribution is not so
made, the Purchase Price shall again be adjusted to be the Purchase Price
which would then be in effect if such record date had not been fixed.
(d) For the purpose of any computation hereunder, the "current market
price" per share of Common Stock on any date shall be deemed to be the
average of the daily closing prices per share of such Common Stock for the
30 consecutive Trading Days (as such term is hereinafter defined)
immediately prior to such date; provided, however, that in the event that
-----------------
the current market price per share of the Common Stock is determined during
a period following the announcement by the issuer of such Common Stock of
(A) a dividend or distribution on such Common Stock payable in shares of
such Common Stock or securities convertible into shares of such Common
Stock (other than the Rights), or (B) any subdivision, combination or
reclassification of such Common Stock, and prior to the expiration of the
requisite 30 Trading Day period, as set forth above, after the ex-dividend
date for such dividend or distribution, or the record date for such
subdivision, combination or reclassification, then, and in each such case,
the "current market price" shall be properly adjusted to take into account
ex-dividend trading. The closing price for each day shall be the last sale
price, regular way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system with
respect to securities listed or admitted to trading on the New York Stock
Exchange or, if the shares of Common Stock
-19-
are not listed or admitted to trading on the New York Stock Exchange, as
reported in the principal consolidated transaction reporting system with
respect to securities listed on the principal national securities exchange
on which the shares of Common Stock are listed or admitted to trading or,
if the shares of Common Stock are not listed or admitted to trading on any
national securities exchange, the last quoted price or, if not so quoted,
the average of the high bid and low asked prices in the over-the-counter
market, as reported by the National Association of Securities Dealers, Inc.
Automated Quotation System ("NASDAQ") or such other system then in use, or,
if on any such date the shares of Common Stock are not quoted by any such
organization, the average of the closing bid and asked prices as furnished
by a professional market maker making a market in the Common Stock selected
by the Board of Directors of the Company. If on any such date no market
maker is making a market in the Common Stock, the fair value of such shares
on such date as determined in good faith by the Board of Directors of the
Company shall be used. The term "Trading Day" shall mean a day on which the
principal national securities exchange on which the shares of Common Stock
are listed or admitted to trading or traded is open for the transaction of
business or, if the shares of Common Stock are not listed or admitted to
trading on any national securities exchange, a Business Day. If the Common
Stock is not publicly held or not so listed or traded, "current market
price" per share shall mean the fair value per share as determined in good
faith by the Board of Directors of the Company, or, if at the time of such
determination there is an Acquiring Person, by a majority of the Continuing
Directors then in office, or if there are no Continuing Directors, by a
nationally recognized investment banking firm selected by the Board of
Directors, which determination shall be described in a statement filed with
the Rights Agent and shall be conclusive for all purposes.
(e) Anything herein to the contrary notwithstanding, no adjustment in
the Purchase Price shall be required unless such adjustment would require
an increase or decrease of at least 1% in the Purchase Price; provided,
--------
however, that any adjustments which by reason of this Section 11(e) are not
-------
required to be made shall be carried forward and taken into account in any
subsequent adjustment. All calculations under this Section 11 shall be made
to the nearest cent or to the nearest ten-thousandth of a share of Common
Stock. Notwithstanding the first sentence of this Section 11(e), any
adjustment required by this Section 11 shall be made no later
-20-
than the earlier of (i) three years from the date of the transaction which
mandates such adjustment or (ii) the Expiration Date.
(f) In the event that at any time, as a result of an adjustment made
pursuant to Section 11(a) (ii), Section 11(a) (iii) or Section 13(a)
hereof, the holder of any Right shall be entitled to receive upon exercise
of such Right any shares of capital stock other than shares of Common
Stock, thereafter the number of such other shares so receivable upon
exercise of any Right and the Purchase Price thereof shall be subject to
adjustment from time to time in a manner and on terms as nearly equivalent
as practicable to the provisions with respect to the Common Stock contained
in Xxxxxxx 00(x), (x), (x), (x), (x), (x), (x), (x), (x), (x) and (m) and
the provisions of Sections 6, 7, 9, 10, 13 and 14 with respect to the
Common Stock shall apply on like terms to any such other shares.
(g) All Rights originally issued by the Company subsequent to any
adjustment made to the Purchase Price hereunder shall evidence the right to
purchase, at the adjusted Purchase Price, the number of shares of Common
Stock purchasable from time to time hereunder upon exercise of the Rights,
all subject to further adjustment as provided herein.
(h) Unless the Company shall have exercised its election as provided
in Section 11(i), upon each adjustment of the Purchase Price as a result of
the calculations made in Section 11(b) and (c), each Right outstanding
immediately prior to the making of such adjustment shall thereafter
evidence the right to purchase, at the adjusted Purchase Price, that number
of shares of Common Stock (calculated to the nearest ten thousandth)
obtained by (i) multiplying (x) the number of shares covered by a Right
immediately prior to this adjustment by (y) the Purchase Price in effect
immediately prior to such adjustment of the Purchase Price and (ii)
dividing the product so obtained by the Purchase Price in effect
immediately after such adjustment of the Purchase Price.
(i) The Company may elect on or after the date of any adjustment of
the Purchase Price to adjust the number of Rights, in lieu of any
adjustment in the number of shares of Common Stock purchasable upon the
exercise of a Right. Each of the Rights outstanding after such adjustment
of the number of Rights shall be exercisable for the number of shares of
Common Stock for which such Right was exercisable immediately
-21-
prior to such adjustment. Each Right held of record prior to such
adjustment of the number of Rights shall become that number of Rights
(calculated to the nearest ten thousandth) obtained by dividing the
Purchase Price in effect immediately prior to adjustment of the Purchase
Price by the Purchase Price in effect immediately after adjustment of the
Purchase Price. The Company shall make a public announcement of its
election to adjust the number of Rights, indicating the record date for the
adjustment, and, if known at the time, the amount of the adjustment to be
made. This record date may be the date on which the Purchase Price is
adjusted or any day thereafter, but, if the Right Certificates have been
issued, shall be at least 10 days later than the date of the public
announcement. If Right Certificates have been issued, upon each adjustment
of the number of Rights pursuant to this Section 11(i), the Company shall,
as promptly as practicable, cause to be distributed to holders of record of
Right Certificates on such record date Right Certificates evidencing,
subject to Section 14 hereof, the additional Rights to which such holders
shall be entitled as a result of such adjustment, or, at the option of the
Company, shall cause to be distributed to such holders of record in
substitution and replacement for the Right Certificates held by such
holders prior to the date of adjustment, and upon surrender thereof, if
required by the Company, new Right Certificates evidencing all the Rights
to which such holders shall be entitled after such adjustment. Right
Certificates so to be distributed shall be issued, executed and
countersigned in the manner provided for herein (and may bear, at the
option of the Company, the adjusted Purchase Price) and shall be registered
in the names of the holders of record of Right Certificates on the record
date specified in the public announcement.
(j) Irrespective of any adjustment or change in the Purchase Price or
the number of shares of Common Stock issuable upon the exercise of the
Rights, the Right Certificates theretofore and thereafter issued may
continue to express the Purchase Price per share and the number of shares
which were expressed in the initial Right Certificates issued hereunder.
(k) Before taking any action that would cause an adjustment reducing
the Purchase Price below the then par value, if any, of a share of Common
Stock issuable upon exercise of the Rights, the Company shall take any
corporate action which may, in the opinion of its counsel, be necessary in
order that the Company may validly and legally issue fully
-22-
paid and nonassessable shares of Common Stock at such adjusted Purchase
Price.
(l) In any case in which this Section 11 shall require that an
adjustment in the Purchase Price be made effective as of a record date for
a specified event, the Company may elect to defer until the occurrence of
such event the issuance to the holder of any Right exercised after such
record date the number of shares of Common Stock and other capital stock or
securities of the Company, if any, issuable upon such exercise over and
above the number of shares of Common Stock and other capital stock or
securities of the Company, if any, issuable upon such exercise on the basis
of the Purchase Price in effect prior to such adjustment; provided however,
----------------
that the Company shall deliver to such holder a due xxxx or other
appropriate instrument evidencing such holder's right to receive such
additional shares upon the occurrence of the event requiring such
adjustment.
(m) Anything in this Section 11 to the contrary notwithstanding, the
Company shall be entitled to make such reductions in the Purchase Price, in
addition to those adjustments expressly required by this Section 11, as and
to the extent that it in its sole discretion shall determine to be
advisable in order that any consolidation or subdivision of the Common
Stock, issuance wholly for cash of any Common Stock at less than the
current market price, issuance wholly for cash of Common Stock or
securities which by their terms are convertible into or exchangeable for
Common Stock, stock dividends or issuance of rights, options or warrants
referred to hereinabove in this Section 11, hereafter made by the Company
to the holders of its Common Stock, shall not be taxable to such
stockholders.
(n) The Company covenants and agrees that it shall not at any time
after the earlier of the Stock Acquisition Date and the Distribution Date
(i) consolidate with, (ii) merge with or into, or (iii) sell or transfer
to, in one transaction or a series of related transactions, assets or
earning power aggregating more than 50% of the assets or earning power of
the Company and its Subsidiaries taken as a whole, any other Person or
Persons if (x) at the time of or immediately after such consolidation,
merger or sale there are any rights, warrants or other instruments
outstanding or agreements or arrangements in effect which would
substantially diminish or otherwise eliminate the benefits intended to be
afforded by the Rights or (y) prior to, simultaneously with or immediately
-23-
after such consolidation, merger or sale, the stockholders of a Person who
constitutes, or would constitute, the "Principal Party" for the purposes of
Section 13(a) hereof shall have received a distribution of Rights
previously owned by such Person or any of its Affiliates and Associates.
(o) The Company covenants and agrees that after the earlier of the
Stock Acquisition Date and the Distribution Date it will not, except as
permitted by Section 23, Section 24 or Section 27 hereof, take (or permit
any Subsidiary to take) any action if at the time such action is taken it
is reasonably foreseeable that such action will substantially diminish or
otherwise eliminate the benefits intended to be afforded by the Rights.
(p) Anything in this Agreement to the contrary notwithstanding, in the
event that the Company shall at any time after the date hereof and prior to
the Distribution Date (i) declare a dividend on the outstanding shares of
Common Stock payable in shares of Common Stock, (ii) subdivide the
outstanding Common Stock, or (iii) combine the outstanding Common Stock
into a smaller number of shares, the number of Rights associated with each
share of Common Stock then outstanding, or issued or delivered thereafter
but prior to the Distribution Date, shall be proportionately adjusted so
that the number of Rights thereafter associated with each share of Common
Stock following any such event shall equal the result obtained by
multiplying the number of Rights associated with each share of Common Stock
immediately prior to such event by a fraction the numerator of which shall
be the total number of shares of Common Stock outstanding immediately prior
to the occurrence of the event and the denominator of which shall be the
total number of shares of Common Stock outstanding immediately following
the occurrence of such event.
Section 12. Certificate of Adjusted Purchase Price or Number of Shares.
----------------------------------------------------------
Whenever an adjustment is made as provided in Sections 11 and 13 hereof, the
Company shall (a) promptly prepare a certificate setting forth such adjustment
and a brief statement of the facts accounting for such adjustment, (b) promptly
file with the Rights Agent and with each transfer agent for the Common Stock a
copy of such certificate and (c) mail a brief summary thereof to each holder of
a Right Certificate (or, if prior to the Distribution Date, to each holder of a
certificate representing shares of Common Stock) in accordance with Section 25
hereof. The Rights Agent shall be fully protected in relying on any such
-24-
certificate and on any adjustment therein contained.
Section 13. Consolidation, Merger or Sale of Assets or Earning Power.
--------------------------------------------------------
(a) In the event that, following the earlier of the Distribution Date
and the Stock Acquisition Date, directly or indirectly, (i) the Company
shall consolidate with, or merge with and into, any other Person, and the
Company shall not be the continuing or surviving corporation of such
consolidation or merger, (ii) any Person shall merge with and into the
Company, and the Company shall be the continuing or surviving corporation
of such merger and, in connection with such merger, all or part of the
Common Stock shall be changed into or exchanged for stock or other
securities of any other Person or cash or any other property, or (iii) the
Company shall sell or otherwise transfer (or one or more of its
Subsidiaries shall sell or otherwise transfer), in one transaction or a
series of related transactions, assets or earning power aggregating more
than 50% of the assets or earning power of the Company and its Subsidiaries
(taken as a whole) to any other Person or Persons, then, and in each such
case, proper provision shall be made so that: (w) each holder of a Right,
except as provided in Section 7(e) hereof, shall thereafter have the right
to receive, upon the exercise thereof at the then current Purchase Price
multiplied by the number of shares of Common Stock for which a Right is
then exercisable (without taking into account any adjustment previously
made pursuant to Section 11(a) (ii) or 11(a) (iii)), in accordance with the
terms of this Agreement, such number of validly authorized and issued,
fully paid and nonassessable shares of freely tradeable Common Stock of the
Principal Party (as hereinafter defined), not subject to any rights of call
or first refusal, liens, encumbrances or other claims, as shall be equal to
the result obtained by (1) multiplying the then current Purchase Price by
the number of shares of Common Stock for which a Right is then exercisable
(without taking into account any adjustment previously made pursuant to
Section 11(a) (ii) or 11(a)(iii)) and dividing that product by (2) 25% of
the current market price (determined pursuant to Section 11(d) (i) hereof)
per share of the Common Stock of such Principal Party on the date of
consummation of such consolidation, merger, sale or transfer; (x) the
Principal Party shall thereafter be liable for, and shall assume, by virtue
of such consolidation, merger, sale or transfer, all the obligations and
duties of the Company pursuant to this Agreement; (y) the term "Company"
shall thereafter be deemed to refer to such Principal Party,
-25-
it being specifically intended that the provisions of Section 11 hereof
shall apply to such Principal Party and (z) such Principal Party shall take
such steps (including, but not limited to, the authorization and
reservation of a sufficient number of shares of its Common Stock to permit
exercise of all outstanding Rights in accordance with this Section 13(a))
in connection with such consummation as may be necessary to assure that the
provisions hereof shall thereafter be applicable, as nearly as reasonably
may be, in relation to the shares of its Common Stock thereafter
deliverable upon the exercise of the Rights.
(b) "Principal Party" shall mean
(1) in the case of any transaction described in clause (i) or
(ii) of the first sentence of Section 13(a), the Person that is the
issuer of any securities into which shares of Common Stock of the
Company are converted in such merger or consolidation, and if no
securities are so issued, the Person that is the other party to the
merger or consolidation; and
(2) in the case of any transaction described in clause (iii) of
the first sentence of Section 13(a), the Person that is the party
receiving the greatest portion of the assets or earning power
transferred pursuant to such transaction or transactions; provided,
--------
however, that in any such case, (x) if the Common Stock of such Person
-------
is not at such time and has not been continuously over the preceding
12-month period registered under Section 12 of the Exchange Act, and
such person is a direct or indirect Subsidiary of another Person the
Common Stock of which is and has been so registered, "Principal Party"
shall refer to such other Person; and (y) in case such Person is a
Subsidiary, directly or indirectly, of more than one Person, the
Common Stocks of two or more of which are and have been so registered,
"Principal Party" shall refer to whichever of such Persons is the
issuer of the Common Stock having the greatest aggregate market value.
(c) The Company shall not consummate any such consolidation, merger,
sale or transfer unless the Principal Party shall have a sufficient number
of authorized shares of its Common Stock which have not been issued or
reserved for issuance to permit the exercise in full of the Rights in
accordance with this Section 13 and unless prior thereto the Company and
such Principal Party shall have executed and
-26-
delivered to the Rights Agent a supplemental agreement providing for the
terms set forth in paragraphs (a) and (b) of this Section 13 and further
providing that, as soon as practicable after the date of any consolidation,
merger or sale of assets mentioned in paragraph (a) of this Section 13, the
Principal Party will
(i) prepare and file a registration statement under the Act with
respect to the Rights and the securities purchasable upon exercise of
the Rights on an appropriate form, will use its best efforts to cause
such registration statement to become effective as soon as practicable
after such filing and will use its best efforts to cause such
registration statement to remain effective (with a prospectus at all
times meeting the requirements of the Act) until the Expiration Date;
and
(ii) will deliver to holders of the Rights historical financial
statements for the Principal Party and each of its Affiliates which
comply in all respects with the requirements for registration on Form
10 under the Exchange Act.
The provisions of this Section 13 shall similarly apply to successive
mergers or consolidations or sales or other transfers. If any event described in
Section 13(a)(i), (ii) or (iii) shall occur at any time after the occurrence of
a Section 11(a) (ii) Event, the Rights which have not theretofore been exercised
shall thereafter become exercisable in the manner described in Section 13(a).
Section 14. Fractional Rights and Fractional Shares.
---------------------------------------
(a) The Company shall not issue fractions of Rights or distribute
Right Certificates which evidence fractional Rights. In lieu of such
fractional Rights, there shall be paid to the registered holders of the
Right Certificates with regard to which such fractional Rights would
otherwise be issuable, an amount in cash equal to the same fraction of the
current market value of a whole Right. For the purposes of this Section
14(a), the current market value of a whole Right shall be the closing price
of the Rights for the Trading Day immediately prior to the date on which
such fractional Rights would have been otherwise issuable. The closing
price of the Rights for any day shall be the last sale price, regular way,
or, in case no such sale takes place on such day, the average of the
closing bid and asked prices, regular way, in either
-27-
case as reported in the principal consolidated transaction reporting system
with respect to securities listed or admitted to trading on the New York
Stock Exchange or, if the Rights are not listed or admitted to trading on
the New York Stock Exchange, as reported in the principal consolidated
transaction reporting system with respect to securities listed on the
principal national securities exchange on which the Rights are listed or
admitted to trading or, if the Rights are not listed or admitted to trading
on any national securities exchange, the last quoted price, or, if not so
quoted, the average of the high bid and low asked prices in the over the
counter market, as reported by NASDAQ or such other system then in use or,
if on any such date the Rights are not quoted by any such organization, the
average of the closing bid and asked prices as furnished by a professional
market maker making a market in the Rights selected by the Board of
Directors of the Company. If on any such date no such market maker is
making a market in the Rights the fair value of the Rights on such date as
determined in good faith by the Board of Directors of the Company shall be
used and shall be conclusive for all purposes.
(b) The Company shall not issue fractions of shares of Common Stock
upon exercise of the Rights or distribute certificates which evidence
fractional shares of Common Stock. In lieu of fractional shares of Common
Stock, the Company shall pay to the registered holders of Right
Certificates at the time such Right Certificates are exercised as herein
provided an amount in cash equal to the same fraction of the current market
value of one share of Common Stock. For purposes of this Section 14(b), the
current market value of one share of Common Stock shall be the closing
price of a share of Common Stock (as determined pursuant to Section 11(d)
hereof) for the Trading Day immediately prior to the date of such exercise.
(c) The holder of a Right by the acceptance of the Rights expressly
waives his right to receive any fractional Rights or any fractional share
upon exercise of Rights.
Section 15. Rights of Action. All rights of action in respect of this
----------------
Agreement are vested in the respective registered holders of the Right
Certificates (and, prior to the Distribution Date, the registered holders of
Common Stock); and any registered holder of any Right Certificate (or, prior to
the Distribution Date, of the Common Stock), without the consent of the Rights
Agent or of the holder of any other Right Certificate (or, prior to the
-28-
Distribution Date, of the Common Stock), may, in his own behalf and for his own
benefit, enforce, and may institute and maintain any suit, action or proceeding
against the Company to enforce, or otherwise act in respect of, his right to
exercise the Rights evidenced by such Right Certificate in the manner provided
in such Right Certificate and in this Agreement. Without limiting the foregoing
or any remedies available to the holders of Rights, it is specifically
acknowledged that the holders of Rights would not have an adequate remedy at law
for any breach of this Agreement and will be entitled to specific performance of
the obligations under, and injunctive relief against actual or threatened
violations of the obligations of, any Person subject to this Agreement.
Section 16. Agreement of Right Holders. Every holder of a Right by
--------------------------
accepting the same consents and agrees with the Company and the Rights Agent and
with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be transferable
only in connection with the transfer of Common Stock;
(b) after the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if surrendered
at the principal office or offices of the Rights Agent designated for such
purposes, duly endorsed or accompanied by a proper instrument of transfer
and with the appropriate certificates fully executed;
(c) subject to Section 6(a) and Section 7(f) hereof, the Company and
the Rights Agent may deem and treat the Person in whose name the Right
Certificate (or, prior to the Distribution Date, the associated Common
Stock certificate) is registered as the absolute owner thereof and of the
Rights evidenced thereby (notwithstanding any notations of ownership or
writing on the Right Certificates or the associated Common Stock
certificate made by anyone other than the Company or the Rights Agent) for
all purposes whatsoever, and neither the Company nor the Rights Agent,
subject to the last sentence of Section 7(e) hereof, shall be affected by
any notice to the contrary; and
(d) notwithstanding anything in this Agreement to the contrary,
neither the Company nor the Rights Agent shall have any liability to any
holder of a Right or other Person as a result of its inability to perform
any of its obligations under this Agreement by reason of any preliminary or
permanent injunction or other order, decree or ruling issued by a court
-29-
of competent jurisdiction or by a governmental, regulatory or
administrative agency or commission, or any statute, rule, regulation or
executive order promulgated or enacted by any governmental authority
prohibiting or otherwise restraining performance of such obligation;
provided however, the Company must use its best efforts to have any such
----------------
order, decree or ruling lifted or otherwise overturned as soon as possible.
Section 17. Right Certificate Holder Not Deemed a Stockholder. No holder,
-------------------------------------------------
as such, of any Right Certificate shall be entitled to vote, receive dividends
or be deemed for any purpose the holder of the number of shares of Common Stock
or any other securities of the Company which may at any time be issuable on the
exercise of the Rights represented thereby, nor shall anything contained herein
or in any Right Certificate be construed to confer upon the holder of any Right
Certificate, as such, any of the rights of a stockholder of the Company or any
right to vote for the election of directors or upon any matter submitted to
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 25), or to receive dividends or
subscription rights, or otherwise, until the Right or Rights evidenced by such
Right Certificate shall have been exercised in accordance with the provisions
hereof.
Section 18. Concerning the Rights Agent.
---------------------------
(a) The Company agrees to pay to the Rights Agent reasonable
compensation for all services rendered by it hereunder and, from time to
time, on demand of the Rights Agent, its reasonable expenses and counsel
fees and disbursements and other disbursements incurred in the
administration and execution of this Agreement and the exercise and
performance of its duties hereunder. The Company also agrees to indemnify
the Rights Agent for, and to hold it harmless against, any loss, liability,
or expense, incurred without negligence, bad faith or willful misconduct on
the part of the Rights Agent, for anything done or omitted by the Rights
Agent in connection with the acceptance and administration of this
Agreement, including the 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 or omitted by it in
connection with its administration of this Agreement in reliance upon any
Right Certificate or certificate for Common Stock or for other securities
of the
-30-
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.
Section 19. Merger or Consolidation or Change of Name of Rights Agent.
---------------------------------------------------------
(a) Any corporation into which the Rights Agent or any successor
Rights Agent may be merged or with which it may be consolidated, or any
corporation resulting from any merger or consolidation to which the Rights
Agent or any successor Rights Agent shall be a party, or any corporation
succeeding to the corporate trust or stock transfer business of the Rights
Agent or any successor Rights Agent, shall be the successor to the Rights
Agent under this Agreement without the execution or filing of any paper or
any further act on the part of any of the parties hereto, provided that
such corporation would be eligible for appointment as a successor Rights
Agent under the provisions of Section 21. In case at the time such
successor Rights Agent shall succeed to the agency created by this
Agreement, any of the Right Certificates shall have been countersigned but
not delivered, any such successor Rights Agent may adopt the
countersignature of the predecessor Rights Agent and deliver such Right
Certificates so countersigned; and in case at that time any of the Right
Certificates shall not have been countersigned, any successor Rights Agent
may countersign such Right Certificates either in the name of the
predecessor Rights Agent or in the name of the successor Rights Agent; and
in all such cases such Right Certificates shall have the full force
provided in the Right Certificates and in this Agreement.
(b) In case at any time the name of the Rights Agent shall be changed
and at such time any of the Right Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the
countersignature under its prior name and deliver Right Certificates so
countersigned; and in case at that time any of the Right Certificates shall
not have been countersigned, the Rights Agent may countersign such Right
Certificates either in its prior name or in its changed name; and in all
such cases such Right Certificates shall have the full force provided in
the Right Certificates and in this Agreement.
-31-
Section 20. Duties of Rights Agent. The Rights Agent undertakes the duties
----------------------
and obligations imposed by this Agreement upon the following terms and
conditions, by all of which the Company and the holders of Right 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 shall be full and
complete authorization and protection to the Rights Agent as to any action
taken or omitted by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this Agreement the
Rights Agent shall deem it necessary or desirable that any fact or matter
(including, without limitation, the identity of any "Acquiring Person" and
the determination of "current market price") be proved or established by
the Company prior to taking or suffering any action hereunder, such fact or
matter (unless other evidence in respect thereof be herein specifically
prescribed) may be deemed to be conclusively proved and established by a
certificate signed by 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 shall be full authorization to the Rights Agent
for any action taken or suffered in good faith by it under the provisions
of this Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only for its own
negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by reason of any of
the statements of fact or recitals contained in this Agreement or in the
Right Certificates (except its countersignature thereof) or be required to
verify the same, but all such statements and recitals are and shall be
deemed to have been made by the Company only.
(e) The Rights Agent shall not be under any responsibility in respect
of the validity of this Agreement or the execution and delivery hereof
(except the due execution hereof by the Rights Agent) or in respect of the
validity or execution of any Right Certificate (except its countersignature
thereof); nor shall it be responsible for any
-32-
breach by the Company of any covenant or condition contained in this
Agreement or in any Right Certificate; nor shall it be responsible for any
change in the exercisability of the Rights (including the Rights becoming
void pursuant to Section 7(e) hereof) or any adjustment in the terms on the
Rights (including the manner, method or amount thereof) provided for in
Sections 3, 11, 13, 23 or 24, or the ascertaining of the existence of facts
that would require any such adjustment (except with respect to the exercise
of Rights evidenced. by Right Certificates after actual notice of any such
adjustment); nor shall it by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation of any
shares of Common Stock to be issued pursuant to this Agreement or any Right
Certificate or as to whether any shares of Common Stock will, when issued,
be validly authorized and issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered all
such further and other acts, instruments and assurances as may reasonably
be required by the Rights Agent for the carrying out or 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
the Chairman of the Board, the President or any Vice President or the
Secretary or any Assistant Secretary or the Treasurer or any Assistant
Treasurer of the Company, and to apply to such officers for advice or
instructions in connection with its duties, and it shall not be liable for
any action taken or suffered to be taken by it in good faith in accordance
with instructions of any such officer.
(h) The Rights Agent and any shareholder, director, officer or
employee of the Rights Agent may buy, sell or deal in any of the Rights or
other securities of the Company or become pecuniarily interested in any
transaction in which the Company may be interested, or contract with or
lend money to the Company or otherwise act as fully and freely as though it
were not the 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
-33-
hereunder either itself or by or through its attorneys or agents, and the
Rights Agent shall not be answerable or accountable for any act, default,
neglect or misconduct of any such attorneys or agents or for any loss to
the Company resulting from any such act, default, neglect or misconduct,
provided reasonable care was exercised in the selection and continued
employment thereof.
(j) No provision of this Agreement shall require the Rights Agent to
expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder or in the exercise of its
rights if there shall be reasonable grounds for believing that repayment of
such funds or adequate indemnification against such risk or liability is
not reasonably assured to it.
(k) If, with respect to any Right Certificate surrendered to the
Rights Agent for exercise or transfer, the certificate attached to the form
of assignment or form of election to purchase, as the cases may be, has
either not been completed or indicates an affirmative response to any item
therein, the Rights Agent shall not take any further action with respect to
such requested exercise or transfer without first consulting with the
Company.
Section 21. Change of Rights Agent. The Rights Agent or any successor
----------------------
Rights Agent may resign and be discharged from its duties under this Agreement
upon 30 days' notice in writing mailed to the Company and to each transfer agent
of the Common Stock by registered or certified mail and to the holders of the
Right Certificates by first-class mail. The Company may remove the Rights Agent
or any successor Rights Agent upon 30 days' notice in writing, mailed to the
Rights Agent or successor Rights Agent, as the case may be, and to each transfer
agent of the Common Stock by registered or certified mail and to the holders of
the Right Certificates by first-class mail. If the Rights Agent shall resign or
be removed or shall otherwise become incapable of acting, the Company shall
appoint a successor to the Rights Agent. If the Company shall fail to make such
appointment within a period of 30 days after such removal or after it has been
notified in writing of such resignation or incapacity by the resigning or
incapacitated Rights Agent or by the holder of a Right Certificate (who shall,
with such notice, submit his Right Certificate for inspection by the Company),
then the registered holder of any Right Certificate may apply to any court of
competent jurisdiction for the appointment of a new Rights Agent. Any successor
Rights Agent, whether appointed by the Company or by such a court, shall be (a)
a
-34-
corporation organized and doing business under the laws of the United States
or of any state of the United States, in good standing, having a principal
office in the State of Connecticut or New York, which is authorized under such
laws to exercise stock transfer or corporate trust powers and is subject to
supervision or examination by federal or state authority and which has at the
time of its appointment as Rights Agent a combined capital and surplus of at
least $50,000,000 or (b) an Affiliate of a corporation described in clause (a)
of this sentence. After appointment, the successor Rights Agent shall be vested
with the same powers, rights, duties and responsibilities as if it had been
originally named as Rights Agent without further act or deed; but the
predecessor Rights Agent shall deliver and transfer to the successor Rights
Agent any property at the time held by it hereunder, and execute and deliver any
further assurance, conveyance, act or deed necessary for the purpose. Not later
than the effective date of any such appointment, the Company shall file notice
thereof in writing with the predecessor Rights Agent and each transfer agent of
the Common Stock and mail a notice thereof in writing to the registered holders
of the Right Certificates. Failure to give any notice provided for in this
Section 21, however, or any defect therein, shall not affect the legality or
validity of the resignation or removal of the Rights Agent or the appointment of
the successor Rights Agent, as the case may be.
Section 22. Issuance of New Right Certificates. Notwithstanding any of the
----------------------------------
provisions of this Agreement or of the Rights to the contrary, the Company may,
at its option, issue new Right Certificates evidencing Rights in such form as
may be approved by its Board of Directors to reflect any adjustment or change in
the Purchase Price and the number or kind or class of shares of stock or other
securities or property purchasable under the Right Certificates made in
accordance with the provisions of this Agreement. In addition, in connection
with the issuance or sale of shares of Common Stock following the Distribution
Date and prior to the earliest of the redemption, exchange or expiration of the
Rights, the Company (a) shall, with respect to shares of Common Stock so issued
or sold pursuant to the exercise of employee stock options or under or to any
employee plan, profit sharing trust or other arrangement outstanding, granted or
awarded as of the Distribution Date, or upon the exercise, conversion or
exchange of securities issued by the Company prior to such date, and (b) may, in
any other case, if deemed necessary or appropriate by a majority of Continuing
Directors, issue Right Certificates representing the appropriate number of
Rights in connection with such issuance or sale; provided, however, that (i) no
-----------------
such Right Certificate shall be issued if, and to the extent that, the Company
shall be advised
-35-
by counsel that such issuance would create a significant risk of material
adverse tax consequences to the Company or the person to whom such Right
Certificate would be issued, and (ii) no such Right Certificate shall be issued
if, and to the extent that, appropriate adjustment shall otherwise have been
made in lieu of the issuance thereof.
Section 23. Redemption.
----------
(a) The Board of Directors of the Company may, at its option, at any
time prior to the earlier of (i) the close of business on the tenth day
after the Stock Acquisition Date or (ii) the Final Expiration Date, redeem
all but not less than all the then outstanding Rights at a redemption price
of $.001 per Right appropriately adjusted to reflect any stock split, stock
dividend, reclassification or similar transaction occurring after the date
hereof (such redemption price being hereinafter referred to as the
"Redemption Price"); provided, however, that if the Board of Directors of
-----------------
the Company authorizes redemption of the Rights at or after the time a
Person becomes an Acquiring Person, then there must be Continuing Directors
then in office and such authorization shall require the concurrence of a
majority of such Continuing Directors. Notwithstanding anything in this
Agreement to the contrary, the Rights shall not be exercisable after the
first occurrence of a Section 11(a) (ii) Event until such time as the
Company's right of redemption hereunder has expired. The Company may, at
its option, pay the Redemption Price in cash, shares of Common Stock (based
on the "current market price," as defined in Section 11(d)(i) hereof, of
the Common Stock at the time of redemption) or any other form of
consideration deemed appropriate by the Board of Directors.
(b) Immediately upon the action of the Board of Directors of the
Company ordering the redemption of the Rights and without any further
action and without any notice, the right to exercise the Rights will
terminate and the only right thereafter of the holders of Rights shall be
to receive the Redemption Price for each Right so held. Promptly after the
action of the Board of Directors ordering the redemption of the Rights, the
Company shall give notice of such redemption to the Rights Agent and the
holders of the then outstanding Rights by mailing such notice to all such
holders at their last addresses as they appear upon the registry books of
the Rights Agent or, prior to the Distribution Date, on the registry books
of the Transfer Agent for the Common Stock. Any notice which is mailed in
the manner herein provided shall
-36-
be deemed given, whether or not the holder receives the notice. Each such
notice of redemption will state the method by which the payment of the
Redemption Price will be made. Neither the Company nor any of its
Subsidiaries may redeem, acquire or purchase for value any Rights at any
time in any manner other than that specifically set forth in this Section
23 or in Section 24 hereof, and other than in connection with the purchase
or other acquisition of shares of Common Stock prior to the Distribution
Date.
Section 24. Notice of Proposed Actions.
--------------------------
(a) In case the Company shall propose, at any time after the
Distribution Date, (i) to pay any dividend payable in stock of any class to
the holders of Common Stock or to make any other distribution to the
holders of Common Stock (other than a regular quarterly cash dividend out
of earnings or retained earnings of the Company), or (ii) to offer to the
holders of its Common Stock rights or warrants to subscribe for or to
purchase any additional shares of Common Stock or shares of stock of any
class or any other securities, rights or options, or (iii) to effect any
reclassification of its Common Stock (other than a reclassification
involving only the subdivision of outstanding shares of Common Stock), or
(iv) to effect any consolidation or merger into or with any other Person,
or to effect any sale or other transfer (or to permit one or more of its
Subsidiaries to effect any sale or other transfer), in one transaction or a
series of related transactions, of more than 50% of the assets or earning
power of the Company and its Subsidiaries (taken as a whole) to any other
Person or Persons, or (v) 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, to the extent feasible and in accordance with Section
25, a notice of such proposed action, which shall specify the record date
for the purposes of such stock dividend, distribution of rights or
warrants, or the date on which such reclassification, consolidation,
merger, sale, transfer, liquidation, dissolution, or winding up is to take
place and the date of participation therein by the holders of Common Stock,
if any such date is to be fixed, and such notice shall be so given in the
case of any action covered by clause (i) or (ii) above at least 20 days
prior to the record date for determining holders of the Common Stock for
purposes of such action, and in the case of any such other action, at least
20 days prior to the date of the taking of such proposed action or the date
of participation therein by the holders of Common Stock,
-37-
whichever shall be the earlier. The failure to give notice required by this
Section 24 or any defect therein shall not affect the legality or validity
of the action taken by the Company or the vote upon any such action.
(b) In case any Section 11(a) (ii) Event shall occur, then, in any
such case, the Company shall as soon as practicable thereafter give to each
holder of a Right Certificate, in accordance with Section 25 hereof.
Section 25. Notices. Notices or demands authorized by this Agreement to be
-------
given or made by the Rights Agent or by the holder of any Right Certificate to
or on the Company shall be sufficiently given or made if sent by first-class
mail, postage prepaid, addressed (until another address is filed in writing with
the Rights Agent) as follows:
New Mil Bancorp, Inc.
00 Xxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Attention: Corporate Secretary
Subject to the provisions of Section 21, any notice or demand authorized by this
Agreement to be given or made by the Company or by the holder of any Right
Certificate to or on the Rights Agent shall be sufficiently given or made if
sent by first-class mail, postage prepaid~ addressed (until another address is
filed in writing with the Company) as follows:
American Stock Transfer & Trust Company
00 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Right Certificate (or, prior to
the Distribution Date, to the holder of any certificate representing shares of
Common Stock) shall be sufficiently given or made if sent by first-class mail,
postage prepaid, addressed to such holder at the address of such holder as shown
on the registry books of the Company.
Section 26. Supplements and Amendments. Prior to the earlier of the Stock
--------------------------
Acquisition Date and the Distribution Date and subject to the penultimate
sentence of this Section 26, the Company and the Rights Agent shall, if the
Company so directs, supplement or amend any provision of this Agreement (whether
or not adverse to the
-38-
holders of Rights) without the approval of any holders of Rights. From and after
the earlier of the Stock Acquisition Date and the Distribution Date and subject
to the penultimate sentence of this Section 26, the Company and the Rights Agent
shall, if the Company so directs, supplement or amend this Agreement without the
approval of any holders of Rights in order (i) to cure any ambiguity, (ii) to
correct or supplement any provision contained herein which may be defective or
inconsistent with any other provisions herein, (iii) to shorten or lengthen any
time period hereunder (which shortening or lengthening shall be effective only
if there are Continuing Directors then in office and shall require the
concurrence of a majority of such Continuing Directors if such supplement or
amendment occurs at or after the time a Person becomes an Acquiring Person) or
(iv) to change or supplement the provisions hereof in any manner which the
Company may deem necessary or desirable and which shall not materially adversely
affect the interests of the holders of Rights Certificates (other than an
Acquiring Person or an Affiliate or Associate of an Acquiring Person); provided,
--------
however, that this Agreement may not be supplemented or amended to lengthen,
-------
pursuant to clause (iii) of this sentence, (A) a time period relating to when
the Rights may be redeemed at such time as the Rights are not then redeemable or
(B) any other time period unless such lengthening is for the purpose of
protecting, enhancing or clarifying the rights of, and/or the benefits to, the
holders of Rights. Upon the delivery of a certificate from an appropriate
officer of the Company which states that the proposed supplement or amendment is
in compliance with the terms of this Section 26, the Rights Agent shall execute
such supplement or amendment. Notwithstanding anything contained in this
Agreement to the contrary, no supplement or amendment shall be made which
decreases the Redemption Price. Prior to the Distribution Date, the interests of
the holders of Rights shall be deemed coincident with the interests of the
holders of Common Stock.
Section 27. Successors. All the covenants and provisions of this Agreement
----------
by or for the benefit of the Company or the Rights Agent shall bind and inure to
the benefit of their respective successors and assigns hereunder.
Section 28. Determinations and Actions by the Board of Directors, etc. For
---------------------------------------------------------
all purposes of this Agreement, any calculation of the number of shares of
Common Stock outstanding at any particular time, including for purposes of
determining the particular percentage of such outstanding shares of Common Stock
of which any Person is the Beneficial Owner, shall be made in accordance with
the last sentence of Rule 13d-3(d)(1)(i) of the
-39-
General Rules and Regulations under the Exchange Act. The Board of Directors of
the Company (with, where specifically provided for herein, the concurrence of
the Continuing Directors) shall have the exclusive power and authority to
administer this Agreement and to exercise all rights and powers specifically
granted to the Board (with, where specifically provided for herein, the
concurrence of the Continuing Directors) or to the Company, or as may be
necessary or advisable in the administration of this Agreement, including
without limitation, the right and power to (i) interpret the provisions of this
Agreement and (ii) make all determinations deemed necessary or advisable for the
administration of this
-40-
Agreement (including a determination to redeem or not redeem the Rights, to
exchange or not to exchange the rights or to amend the Agreement). All such
actions, calculations, interpretations and determinations (including, for
purposes of clause (y) below, all omissions with respect to the foregoing) which
are done or made by the Board (or, where specifically provided for herein, by
the Continuing Directors) in good faith, shall (x) be final, conclusive and
binding on the Company, the Rights Agent, the holders of the Rights and all
other parties, and (y) not subject to the Board or the Continuing Directors to
any liability to the holders of the Right.
Section 29. 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
registered holders of the Right Certificates (and, prior to the Distribution
Date, the Common Stock) any legal or equitable right, remedy or claim under this
Agreement; but this Agreement shall be for the sole and exclusive benefit of the
Company, the Rights Agent and the registered holders of the Right Certificates
(and, prior to the Distribution Date, the Common Stock).
Section 30. Severability. If any term, provision, covenant or restriction
------------
of this Agreement is held by a court of competent jurisdiction or other
authority to be invalid, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions of this Agreement shall remain in full
force and effect and shall in no way be affected, impaired or invalidated.
Section 31. Governing Law. This Agreement, each Right and each Right
-------------
Certificate issued hereunder shall be deemed to be a contract made under the
laws of the State of Connecticut and for all purposes shall be governed by and
construed in accordance with the laws of such state applicable to contracts to
be made and performed entirely within such state.
Section 32. Counterparts. This Agreement may be executed in any number of
------------
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute one and the
same instrument.
Section 33. Descriptive Headings. The captions herein and in the table of
--------------------
contents hereto are included for convenience of reference only, do not
constitute a part of this Agreement and shall be ignored in the construction and
interpretation hereof.
-41-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, all as of the day and year first above written.
NEW MIL BANCORP, INC.
By
---------------------------
Chairman of the Board
AMERICAN STOCK TRANSFER &
TRUST COMPANY
By
---------------------------
Vice President
-42-
Exhibit A
---------
Form of Right Certificate
Certificate No. R- Rights
---------
NOT EXERCISABLE AFTER JULY 18, 2004 OR EARLIER IF REDEEMED OR EXCHANGED BY
THE COMPANY. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE
COMPANY, AT $.001 PER RIGHT, AND TO EXCHANGE AT THE OPTION OF THE COMPANY,
ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. AS DESCRIBED IN THE RIGHTS
AGREEMENT, RIGHTS BENEFICIALLY OWNED BY (l) AN ACQUIRING PERSON OR ANY
ASSOCIATE OR AFFILIATE THEREOF (AS SUCH TERMS ARE DEFINED IN THE RIGHTS
AGREEMENT), (2) A TRANSFEREE OF AN ACQUIRING PERSON (OR OF ANY SUCH
ASSOCIATE OR AFFILIATE) WHO BECOMES A TRANSFEREE AFTER THE ACQUIRING PERSON
BECOMES SUCH OR (3) UNDER CERTAIN CIRCUMSTANCES, A TRANSFEREE OF AN
ACQUIRING PERSON (OR OF ANY SUCH ASSOCIATE OF AFFILIATE) WHO BECOMES A
TRANSFEREE BEFORE OR CONCURRENTLY WITH THE ACQUIRING PERSON BECOMING SUCH,
SHALL BECOME NULL AND VOID.
Right Certificate
New Mil Bancorp, Inc.
This certifies that , or registered assigns,
--------------------------
is the registered owner of the number of Rights set forth above, each of which
entitles the owner thereof, subject to the terms, provisions and conditions of
the Rights Agreement dated as of July 19, 1994 (the "Rights Agreement") between
New Mil Bancorp, Inc., a Delaware Corporation (the "Company"), and American
Stock Transfer & Trust Company (the "Rights Agent"), to purchase from the
Company at any time after the Distribution Date (as such term is defined in the
Rights Agreement) and prior to 5:00 P.M. (Eastern time) on July 18, 2004 at the
office or offices of the Rights Agent designated for such purpose, or its
successors as Rights Agent, one fully paid, non-assessable share of Common Stock
(the "Common Stock") of the Company, at a cash purchase price of $20 per share
(the "Purchase Price"), upon presentation and surrender of this Right
Certificate with the Form of Election to Purchase and the related Certificate
duly executed. The number of Rights evidenced by this Right Certificate (and the
number of
shares which may be purchased upon exercise thereof) set forth above, and the
Purchase Price per share set forth above, are the number and Purchase Price as
of July 19, 1994, based on the Common Stock as constituted at such date.
Upon the occurrence of a Section 11(a) (ii) Event (as such term is defined
in the Rights Agreement), if the Rights evidenced by this Right Certificate are
beneficially owned by (i) an Acquiring Person or an Affiliate or Associate of
any such Acquiring Person (as such terms are defined in the Rights Agreement),
(ii) a transferee of an Acquiring Person (or of any such Affiliate or Associate)
who becomes a transferee after the Acquiring Person becomes such), or (iii)
under certain circumstances specified in the Rights Agreement, a transferee of
an Acquiring Person (or of any such Affiliate or Associate) who becomes a
transferee before or concurrently with the Acquiring Person becoming such), such
Rights shall become null and void and no holder hereof shall have any right with
respect to such Rights from and after the occurrence of such Section 11(a) (ii)
Event.
As provided in the Rights Agreement, the Purchase Price and the number and
kind of shares of Common Stock or other securities which may be purchased upon
the exercise of the Rights evidenced by this Right Certificate are subject to
modification and adjustment upon the happening of certain events.
This Right Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Right Certificates, which
limitations of rights include the temporary suspension of the exercisability of
such Rights under the specific circumstances set forth in the Rights Agreement.
Copies of the Rights Agreement are on file at the above-mentioned office of the
Rights Agent and are also available upon written request to the Company.
This Right Certificate, with or without other Right Certificates, upon
surrender at the office or offices of the Rights Agent designated for such
purpose, may be exchanged for another Right Certificate or Right Certificates of
like tenor and date evidencing Rights entitling the holder to purchase a like
aggregate number of shares of Common Stock as the Rights evidenced by the Right
Certificate or Right Certificates surrendered shall have entitled such holder to
purchase. If this Right Certificate shall be exercised in part, the holder shall
be entitled to receive upon surrender hereof another Right Certificate or Right
Certificates for the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced by
this Certificate (i) may be redeemed by the Company at its option at a
redemption price of $.001 per Right or (ii) may be exchanged by the Company at
its option for shares of the Company's Common Stock, par value $.50 per share
(or, in certain circumstances, Common Stock Equivalents (as such term is defined
in the Rights Agreement)).
No fractional shares of Common Stock will be issued upon the exercise
of any Right or Rights evidenced hereby, but in lieu thereof a cash payment will
be made, as provided in the Rights Agreement.
No holder of this Right Certificate shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of shares of Common
Stock or of any other securities of the Company which may at any time be
issuable on the exercise hereof, nor shall anything contained in the Rights
Agreement or herein be construed to confer upon the holder hereof, as such, any
of the rights of a stockholder of the Company or any right to vote for the
election of directors or upon any matter submitted to stockholders at any
meeting thereof, or to give or withhold consent to any corporate action, or, to
receive notice of meetings or other actions affecting stockholders (except as
provided in the Rights Agreement), or to receive dividends or subscription
rights, or otherwise, until the Right or Rights evidenced by this Right
Certificate shall have been exercised as provided in the Rights Agreement.
This Right Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the Company and
its corporate seal.
Dated as of , 19 .
-------------------- --
Attest: New Mil Bancorp, Inc.
-------------------------- ---------------------------
Secretary Title:
(seal)
Countersigned:
A-3
--------------------------
as Rights Agent
By
-----------------------
Authorized Signature
A-4
Form of Reverse Side of Right Certificate
FORM OF ASSIGNMENT
------------------
(To be executed by the registered holder if such
holder desires to transfer the Right Certificate.)
FOR VALUE RECEIVED
-------------------------------------------------------------
hereby sells, assigns and transfers unto
---------------------------------------
--------------------------------------------------------------------------------
(Please print name and address of transferee)
--------------------------------------------------------------------------------
this Right Certificate, together with all right, title and interest therein, and
does hereby irrevocably constitute and appoint Attorney, to
----------------
transfer the within Right Certificate on the books of the within-named Company,
with full power of substitution.
Dated: , 19 .
--------------- --
---------------------------------
Signature Guaranteed: Signature
A-5
Certificate
-----------
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) the Rights evidenced by this Right Certificate are are not
---- ----
being exercised by or on behalf of a Person who is or was an Acquiring Person or
an Affiliate or Associate of any such Acquiring Person (as such terms are
defined in the Rights Agreement);
(2) after due inquiry and to the best knowledge of the undersigned, the
Rights evidenced by this Right Certificate are are not being sold,
--- ---
assigned and transferred to a Person who is an Acquiring Person, an Affiliate or
Associate of an Acquiring Person or a nominee of any such Acquiring Person,
Affiliate or Associate.
(3) after due inquiry and to the best knowledge of the undersigned, it
----
did did not acquire the Rights evidenced by this Right Certificate from any
----
Person who is, was or subsequently became an Acquiring Person or an Affiliate or
Associate of an Acquiring Person.
Dated: , 19
----------- -- ------------------------------
Signature
NOTICE
------
The signatures to the foregoing Assignment and Certificate must correspond
to the name as written upon the face of this Right Certificate in every
particular, without alteration or enlargement or any change whatsoever.
A-6
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise Rights
represented by the Right Certificate.)
To: New Mil Bancorp, Inc.
The undersigned hereby irrevocably elects to exercise
----------------
Rights represented by this Right Certificate to purchase the shares of Common
Stock issuable upon the exercise of the Rights (or such other securities of the
Company or of any other person which may be issuable upon the exercise of the
Rights) and requests that certificates for such shares be issued in the name of
and delivered to:
Please insert social security
or other identifying number
--------------------------------------------------------------------------------
(Please print name and address)
--------------------------------------------------------------------------------
If such number of Rights shall not be all the Rights evidenced by this
Right Certificate, a new Right Certificate for the balance of such Rights shall
be registered in the name of and delivered to:
Please insert social security
or other identifying number
--------------------------------------------------------------------------------
(Please print name and address)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Dated: , 19 .
------------------ --
----------------------------------
Signature Guaranteed: Signature
A-7
A-8
Certificate
-----------
The undersigned hereby certifies by checking the appropriate boxes that:
(1) the Rights evidenced by this Right Certificate are are not
---- ----
being exercised by or on behalf of a Person who is or was an Acquiring Person or
an Affiliate or Associate of any such Acquiring Person (as such terms are
defined in the Rights Agreement);
(2) after due inquiry and to the best knowledge of the undersigned, it
----
did did not acquire the Rights evidenced by this eight Certificate from any
----
Person who is, was or became an Acquiring Person or an Affiliate or Associate of
an Acquiring Person.
Dated: , 19 .
------------ -- ---------------------------------
Signature
NOTICE
------
The signature to the foregoing Election to Purchase and Certificate
must correspond to the name as written upon the face of this Right Certificate
in every particular, without alteration or enlargement or any change whatsoever.
A-9
Exhibit B
---------
NEW MIL BANCORP, INC.
SUMMARY OF RIGHTS TO PURCHASE COMMON SHARES
On July 19, 1994 (the "Declaration Date"), the Board of Directors of New Mil
Bancorp, Inc. (the "Company") declared a dividend distribution of one Right for
each five outstanding shares of Common Stock of the Company. The dividend is
payable on July 19, 1994 to the stockholders of record as of the close of
business on such date (the "Record Date"). Each Right entitles the registered
holder to purchase from the company one share of the Company's Common Stock,
$.50 par value (the "Common Shares") at a price of $20 (the "Purchase Price"),
subject to adjustment. The description and terms of the Rights are set forth in
a Rights Agreement (the "Rights Agreement") between the Company and American
Stock Transfer & Trust Company (the "Rights Agent").
Until the close of business on the earliest of (i) the tenth day after a public
announcement that a person or group of affiliated or associated persons has
acquired, or obtained the right to acquire, beneficial ownership of 10% or more
of the outstanding shares of Common Stock of the Company (an "Acquiring
Person"); (ii) the tenth day (or such later day as may be determined by action
of the Board of Directors of the Company prior to such time as any person
becomes an Acquiring Person) after the date of the commencement of a tender or
an exchange offer by any person (other than the Company) to acquire (when added
to any shares as to which such person is the beneficial owner immediately prior
to such commencement) beneficial ownership of 10% or more of the issued and
outstanding shares of Common Stock; and (iii) the tenth day (or such later day
as may be determined by action of the Board of Directors of the Company prior to
such time as any person becomes an Acquiring Person) after the filing by any
Person (other than the Company) of a registration statement under the Securities
Act of 1933, as amended, with respect to a contemplated exchange offer to
acquire (when added to any shares as to which such person is the beneficial
owner immediately prior to such filing) beneficial ownership of 10% or more of
the issued and outstanding shares of Common Stock (the earliest of such dates
being called the "Distribution Date"), the Rights will be evidenced, with
respect to any of the Company's Common Stock certificates outstanding as of the
Record Date, by such Common Stock certificate and this Summary. The date of
announcement of the existence of an Acquiring Person referred to in clause (i)
above is hereinafter referred to as the "Stock Acquisition Date."
The Rights Agreement provides that, until the Distribution Date, the Rights will
be transferred with and only with the Company's Common Stock. New Common Stock
certificates issued after the Record Date upon transfer or new issuance of the
Company's Common Stock will contain a notation incorporating the Rights
Agreement by reference. Until the Distribution Date, the surrender for transfer
of any of the Common Stock certificates outstanding as of the Record Date will
also constitute the transfer of the Rights associated with the Common Stock
represented by such certificate and the number of Rights associated with each
share of Common Stock shall be proportionately adjusted in the event of any
dividend in Common Stock on the Common Stock or subdivision, combination or
reclassification of the Common Stock. As soon as practicable following the
Distribution Date, separate certificates evidencing the Rights ("Right
Certificates") will be mailed to holders of record of the Company's Common Stock
as of the close of business on the Distribution Date and such separate
certificates alone will evidence Rights.
The Rights are not exercisable until the Distribution Date. The Rights will
expire on July 18, 2004, unless earlier redeemed by the Company as described
below.
The Purchase Price payable, and the number of shares of Common Stock or other
securities or property issuable, upon exercise of the Rights are subject to
adjustment from time to time to prevent dilution in the event of a stock
dividend on, or a subdivision, combination or reclassification of, the Common
Stock.
In the event that the Company is acquired in a merger or other business
combination, proper provision shall be made so that each holder of a Right shall
thereafter have the right to receive, upon the exercise thereof at the then
current exercise price of the Right, that number of shares of common stock of
the surviving company (or its parent company or other controlling entity) which
at the time of such transaction would have a market value of four times the
exercise price of the Right. In the event that the Company were the surviving
corporation in a merger with any Person, or in the event that the Stock
Acquisition Date occurs, the Rights Agreement provides that proper provision
would be made so that each holder of a Right, other than the Acquiring Person
(whose Rights would thereafter be null and void) and certain of its transferees,
would thereafter have the right to receive upon exercise that number of shares
of the Company's Common Stock having a market value of four times the exercise
price of the Right (i.e., a 75% discount to market value); if insufficient
shares are available to satisfy the Right, the Company may substitute other
consideration, as appropriate, or make an adjustment to the exercise price of
the
Right to achieve substantially the intended economic benefit to shareholders
(other than the Acquiring Person) of the 75% discount.
With certain exceptions, no adjustment in the Purchase Price will be required
until cumulative adjustments require an adjustment of at least 1% in such
Purchase Price. No fractional shares of Common Stock will be issued and, in lieu
thereof, if necessary, an adjustment in cash will be made based on the market
price of the Common Shares on the last trading date prior to the date of
exercise.
At any time prior to the close of business on the date that Rights holders
become entitled to purchase Common Stock of the Company (or of the surviving
entity after a merger with the Company) with a market value of four times the
Purchase Price (as described above), the Company may redeem the Rights in whole,
but not in part, at a price of $.001 per Right (payable in cash, shares of
Common Stock or other consideration), appropriately adjusted to reflect any
stock split, stock dividend or similar transaction occurring after the date
hereof (the "Redemption Price"). Immediately upon the action of the Board of
Directors of the Company electing to redeem the Rights, the right to exercise
the Rights will terminate and the only right of the holders of Rights will be to
receive the Redemption Price.
Until a Right is exercised, the holder thereof, as such, will have no rights as
a stockholder of the Company, including, without limitation, no right to vote or
to receive dividends.
The terms of the Rights may be amended by the Company and the Rights Agent,
provided that following the earlier of the Distribution Date and the Stock
Acquisition Date, the amendment does not materially adversely affect the
interests of the holders of the Rights (other than an Acquiring Person) and
provided that no amendment shall be made which decreases the Redemption Price.
A copy of the Rights Agreement is being filed with the Securities and Exchange
Commission as an Exhibit to a Registration Statement on Form 8-A. A copy of the
Rights Agreement will be available free of charge from the Company. This summary
description of the Rights does not purport to be complete and is qualified in
its entirety by reference to the Rights Agreement, which is incorporated herein
by reference.
B-3
AMENDMENT NO. 1 TO RIGHTS AGREEMENT
This Amendment dated as of May 1, 1995 between NEWMIL BANCORP, INC., a
Delaware corporation (the "Company"), and AMERICAN STOCK TRANSFER & TRUST
COMPANY, as Rights Agent (the "Rights Agent") amends that certain Rights
Agreement dated as of July 19, 1994 by and between the Company and the Rights
Agent,
W I T N E S S E T H
WHEREAS, on July 19, 1994, the Board of Directors of the Company authorized
and declared a dividend distribution of one Right (referred to in the Rights
Agreement as a "Right" and hereafter referred to in this Amendment as a "1994
Right") for each five outstanding shares of the Common Stock, par value $.50 per
share, of the Company (the "Common Stock") outstanding at the close of business
on July 19, 1994 (referred to in the Rights Agreement as the "Record Date")
(other than shares of such common stock held in the Company's treasury on such
date) and authorized the issuance of one 1994 Right (as such number may be
adjusted pursuant to Section 11(p) of the Rights Agreement) in respect of each
five shares of Common Stock that shall become outstanding after the Record Date
(whether originally issued or delivered from the Company's treasury) and on or
prior to the earlier of the Distribution Date and the Expiration Date (as such
terms are defined in the Rights Agreement), each Right representing the right
to purchase one share of the Company's Common Stock upon the terms and subject
to the conditions set forth in the Rights Agreement (the "1994 Rights"); and
WHEREAS, on April 18, 1995 the Board of Directors of the Company authorized
and declared a dividend distribution of four Rights (hereinafter referred to
collectively as the "1995 Rights" and individually as a "1995 Right") for each
five shares of the Common Stock outstanding at the close of business on May 1,
1995 (hereinafter referred to as the "1995 Record Date") (other than shares of
such Common Stock held in the Company's treasury on such date) and has
authorized the issuance of four 1995 Rights (as such number may hereafter be
adjusted pursuant to the provisions of Section 11(p) of the Rights Agreement) in
respect of each five shares of Common Stock of the Company that shall become
outstanding after the 1995 Record Date (whether originally issued or delivered
from the Company's treasury) and on or prior to the earlier of the Distribution
Date and the Expiration Date, each 1995 Right representing the right to purchase
one share of the Company's Common Stock upon the terms and subject to the
conditions hereinafter set forth; and
WHEREAS, it is the intent of the Board of Directors of the Company that the
result of the declaration of the 1995 Rights when combined with the declaration
of the 1994 Rights will be that each
share of the Common Stock of the Company will trade with one Right as of and
after the 1995 Record Date; and
WHEREAS, the parties to the Rights Agreement desire to amend the Rights
Agreement to reflect the 1995 Rights;
NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein set forth, the parties hereby agree as follows:
1. The "WHEREAS" paragraph of the Rights Agreement shall be, and hereby is,
superseded and replaced by the "WHEREAS" clauses set forth in this Amendment.
2. For the purposes of the Rights Agreement, as amended, the term "Rights"
as used therein, shall mean the 1994 Rights and the 1995 Rights collectively.
3. Sub-section (a) of Section 3. Issue of Rights Certificates shall be, and
----------------------------
hereby is, revised in its entirety to read as follows:
(a) Until the earliest of (i) the close of business on the tenth day
after the Stock Acquisition Date (or, if the
tenth business day after the Stock Acquisition Date occurs before the 1995
Record Date, the close of business on the 1995 Record Date); or (ii) the
close of business on the tenth Business Day after the date of the
commencement of a tender or exchange offer by any Person if, upon
consummation thereof, such Person would be an Acquiring Person (including
any such date which is after the date of this Agreement and prior to the
issuance of the Rights); or (iii) the tenth day (or such later day as may
be determined by action of the Board of Directors of the Company prior to
such time as any person becomes an Acquiring Person) after the filing by
any Person (other than the Company) of a registration statement under the
Securities Act of 1933, as amended, with respect to a contemplated exchange
offer to acquire (when added to any shares as to which such person is the
beneficial owner immediately prior to such filing) beneficial ownership of
10% or more of the issued and outstanding shares of Common Stock; (the
earliest of such dates being herein referred to as the "Distribution
Date"), (x) the Rights will be evidenced (subject to the provisions of
paragraph (b) of this Section 3) by the certificates for the Common Stock
registered in the names of the holders of the Common Stock (which
certificates for Common Stock shall be deemed also to be Right
Certificates) and not by separate Right Certificates, and (y) the Rights
will be transferable only in connection with the
4.
transfer of the underlying shares of Common Stock. As soon as practicable
after the Company has notified the Rights Agent of the occurrence of the
Distribution Date, the Rights Agent will send, by first-class, insured,
postage prepaid mail, to each record holder of the Common Stock as of the
close of business on the Distribution Date, at the address of such holder
shown on the records of the Company, one or more right certificates, in
substantially the form of Exhibit A hereto (the "Right Certificates"),
evidencing one Right for each full share of Common Stock so held, subject
to adjustment as provided herein. In the event that an adjustment in the
number of Rights per share of Common Stock has been made pursuant to
Section 11(p) hereof, at the time of distribution of the Right
Certificates, the Company shall make the necessary and appropriate rounding
adjustments (in accordance with Section 14(a) hereof) so that the Right
Certificates representing only whole numbers of Rights are distributed and
cash is paid in lieu of any fractional Rights. As of and after the
Distribution Date, the Rights will be evidenced solely by such Right
Certificates.
4. Sub-sections (b) and (c) of Section 3 Issue of Rights Certificates shall
----------------------------
be, and hereby are, revised by changing the term "Record Date" to read "1995
Record Date" in each instance in which such term appears in such sub-sections.
5.
5. In sub-section (c) of Section 3. Issue of Rights Certificates, the
----------------------------
reference to the "Rights Agreement between NewMil Bancorp, Inc. and American
Stock Transfer & Trust Company dated as of July 19, 1994 (the "Rights
Agreement")" in the text of the legend set forth in such sub-section (c) shall
be deemed to refer to the Rights Agreement as amended by this Amendment.
6. Section 4, Form of Right Certificates shall be, and hereby is, revised
--------------------------
by changing the term "Record Date" in the second sentence of this Section to
read "1995 Record Date."
7. Exhibit A. Form of Right Certificate shall be, and hereby is, revised by
-------------------------
changing the reference to "July 19, 1994" in the next to last line on the first
page of the Exhibit to read "May 1, 1995."
8. Exhibit B. Newmil Bancorp, Inc. Summary of Rights to Purchase Common
---------------------------------------------------------
Shares shall be, and hereby is, revised in its entirety to read as set forth in
------
Exhibit B, attached hereto.
9. The Rights Agreement is hereby ratified and confirmed and shall continue
in accordance with its terms as expressly modified herein.
6.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed, as of the day and year first above written. NEWMIL BANCORP, INC.
By
---------------------------------
Chairman of the Board
AMERICAN STOCK TRANSFER &
TRUST COMPANY
By
---------------------------------
Vice President
7.
