EXHIBIT 10.1
URSTADT XXXXXX PROPERTIES INC.
and
THE BANK OF NEW YORK
as Rights Agent
----------
Rights Agreement
Dated as of July 31, 1998
INDEX
Page
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SECTION 1. CERTAIN DEFINITIONS.......................................... 2
SECTION 2. EFFECTIVENESS OF AGREEMENT; APPOINTMENT OF RIGHTS AGENT...... 5
SECTION 3. ISSUE OF RIGHT CERTIFICATES.................................. 5
SECTION 4. FORM OF RIGHT CERTIFICATES................................... 7
SECTION 5. COUNTERSIGNATURE AND REGISTRATION............................ 8
SECTION 6. TRANSFER, SPLIT UP, COMBINATION AND EXCHANGE OF RIGHT
CERTIFICATES; MUTILATED, DESTROYED, LOST OR STOLEN
RIGHT CERTIFICATES......................................... 8
SECTION 7. EXERCISE OF RIGHTS; PURCHASE PRICE; EXPIRATION DATE OF RIGHTS 9
SECTION 8. CANCELLATION OF RIGHT CERTIFICATES........................... 11
SECTION 9. RESERVATION AND AVAILABILITY OF SHARES; COVENANTS............ 11
SECTION 10. PREFERRED SHARES RECORD DATE; ETC............................ 12
SECTION 11. ANTIDILUTION ADJUSTMENTS..................................... 13
SECTION 12. CERTIFICATE OF ADJUSTMENTS................................... 22
SECTION 13. CONSOLIDATION, MERGER OR SALE OR TRANSFER OF ASSETS OR
EARNING POWER.............................................. 22
SECTION 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES...................... 25
SECTION 15. RIGHTS OF ACTION............................................. 25
SECTION 16. AGREEMENT OF RIGHT HOLDERS................................... 00
-x-
XXXXXXX 00. RIGHT CERTIFICATE HOLDER NOT DEEMED A SHAREHOLDER............ 26
SECTION 18. CONCERNING THE RIGHTS AGENT.................................. 27
SECTION 19. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF RIGHTS AGENT.... 27
SECTION 20. DUTIES OF RIGHTS AGENT....................................... 28
SECTION 21. CHANGE OF RIGHTS AGENT....................................... 30
SECTION 22. ISSUANCE OF NEW RIGHT CERTIFICATES........................... 31
SECTION 23. REDEMPTION AND TERMINATION................................... 31
SECTION 24. NOTICE OF PROPOSED ACTIONS................................... 32
SECTION 25. NOTICES...................................................... 33
SECTION 26. SUPPLEMENTS AND AMENDMENTS................................... 34
SECTION 27. SUCCESSORS................................................... 35
SECTION 28. DETERMINATION AND ACTIONS BY THE DIRECTORS; ETC.............. 35
SECTION 29. BENEFITS OF THIS AGREEMENT................................... 35
SECTION 30. GOVERNING LAW................................................ 35
SECTION 31. COUNTERPARTS................................................. 36
SECTION 32. DESCRIPTIVE HEADINGS......................................... 36
SECTION 33. SEVERABILITY................................................. 36
EXHIBIT A ARTICLES SUPPLEMENTARY ....................................... A1
EXHIBIT B FORM OF RIGHT CERTIFICATE..................................... B1
-ii-
RIGHTS AGREEMENT
RIGHTS AGREEMENT (this "Agreement") dated as of July 31, 1998, between
URSTADT XXXXXX PROPERTIES INC., a Maryland corporation (the "Corporation"), and
THE BANK OF NEW YORK, a New York banking corporation (the "Rights Agent").
W I T N E S S E T H
WHEREAS, the Corporation (formerly known as "HRE Properties, Inc.")
previously entered into that certain Rights Agreement, dated as of March 12,
1997, by and between the Corporation and the Rights Agent, as amended and
restated by that certain Amended and Restated Rights Agreement, dated as of July
31, 1998, by and between the Corporation and the Rights Agent (as so amended and
restated, the "Prior Rights Agreement"), pursuant to which rights (collectively,
the "Prior Rights") to purchase one one-hundredth of a share of the
Corporation's Series A Participating Preferred Shares were issued in respect of,
and are currently evidenced by the certificates representing, the shares of the
Corporation's Common Stock, par value $.01 per share (the "Original Common
Shares") and the shares of the Corporation's Class A Common Stock, par value
$.01 per share (the "Class A Common Shares");
WHEREAS, pursuant to the Prior Rights Agreement, the Prior Rights shall
expire at the close of business on November 13, 1998 (the "Current Expiration
Date");
WHEREAS, the Board of Directors of the Corporation (the "Board") has
authorized the issuance of, and agreed to issue, one right (as such number may
be adjusted in accordance with Sections 11(i) or 11(o) hereof) to purchase one
one-hundredth of a share of the Corporation's Series A Participating Preferred
Shares in respect of every Original Common Share and every Class A Common Share
outstanding as of the close of business on the Current Expiration Date
(collectively, the "Rights," and individually a "Right"), which Rights shall
initially be evidenced by the certificates representing the Original Common
Shares and Class A Common Shares and shall be subject to the terms and
conditions of this Agreement; and
WHEREAS, the Board has authorized the issuance of, and agreed to issue, one
Right (as such number may be adjusted in accordance with Sections 11(i) or 11(o)
hereof) for every Original Common Share and for every Class A Common Share
issued between the Declaration Date (as defined herein) and the Distribution
Date (as defined herein); and
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 following terms shall have the meanings
indicated:
(a) The term "Acquiring Person" shall mean any Person who or which,
together with all Affiliates of such Person, shall be the Beneficial Owner of
10% or more of the total combined voting power of the outstanding Common Shares;
provided, however, that none of the Corporation, any Wholly Owned Subsidiary of
the Corporation, or any employee benefit plan of the Corporation, or any trustee
of, or member of a committee having voting or investment power over Common
Shares held by any employee benefit plan of the Corporation acting in such
capacity, or any Exempted Person shall be an "Acquiring Person" for any purpose
of this Agreement.
(b) The term "Affiliate," with respect to any Person, shall mean any other
Person who is, or would be deemed to be, an "affiliate" or an "associate" of
such Person within 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 such Rule is in effect on the Declaration
Date.
(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 has
"beneficial ownership" of within the meaning of Rule 13d-3 of the
General Rules and Regulations under the Exchange Act (or any
successor rule);
(ii) which such Person or any of such Person's Affiliates has (A) the
right to acquire (whether such right is exercisable immediately
or after the passage of time) pursuant to any agreement,
arrangement or understanding (whether or not in writing) or upon
the exercise of conversion, exchange or other rights (other than
the Rights), warrants or options, or otherwise; or (B) the right
to vote pursuant to any agreement, arrangement or understanding
(whether or not in writing); or
(iii)which are beneficially owned, directly or indirectly, by any
other Person or any Affiliate of such Person with which such
Person or any of such Person's Affiliates has any agreement,
arrangement or understanding (whether or not in writing), for the
purpose of acquiring, holding, voting (except as provided in
clause (B) below) or disposing of any securities of the
Corporation.
For purposes of this subsection (c), a Person shall not be deemed the
"Beneficial Owner" of or to "beneficially own," (A) securities tendered pursuant
to a tender or exchange offer made by such Person or such Person's Affiliates
until such tendered securities are accepted for purchase
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or exchange, (B) any security that is the subject of any agreement, arrangement
or understanding which (1) arises solely from a revocable proxy given in
response to a public proxy or consent solicitation made pursuant to, and in
accordance with, the applicable proxy solicitation rules and regulations
promulgated under the Exchange Act and (2) is not also then reportable on
Schedule 13D under the Exchange Act (or any comparable or successor report).
(d) The term "Business Day" shall mean any day other than a Saturday,
Sunday, or a day on which banking institutions in the State of New York are
authorized or obliged by law or executive order to close.
(e) The term "close of business" on any day shall mean 5:00 P.M., New York
City time, on such day; provided, however, that if such day is not a Business
Day, it shall mean 5:00 P.M., New York City time, on the next succeeding
Business Day.
(f) The term "Common Shares" shall mean the Original Common Shares and the
Class A Common Shares.
(g) The term "Common Stock" when used with respect to any Person other than
the Corporation shall mean the capital stock with the greatest voting power or
the equity securities or other equity interests having the power to control or
direct the management and affairs of such Person, or if such Person is a
Subsidiary of another Person, the Person who ultimately controls such first
mentioned Person and which has outstanding such Common Stock (or other equity
securities).
(h) The term "Common Share Event" shall mean the occurrence of any event
described in (I) Section 11(a)(ii) hereof or (II) clauses (a), (b) or (c) of the
first sentence of Section 13 hereof.
(i) The term "Declaration Date" shall mean November 13, 1998 and shall be
the effective date of this Agreement.
(j) The term "Disqualified Transferee" shall mean any Person who is a
transferee of any Rights from an Acquiring Person or an Affiliate of an
Acquiring Person and becomes such a transferee (x) after the occurrence of a
Common Share Event or (y) prior to or concurrently with the Acquiring Person
becoming such and received such Rights pursuant to a transfer (whether or not
for value) (A) from the Acquiring Person to holders of its Common Stock or other
equity securities or to any Person with whom the Acquiring Person has any
continuing agreement, arrangement or understanding regarding the transferred
Rights or (B) which a majority of the Directors then in office determine is part
of a plan, arrangement or understanding which has as a primary purpose or effect
the avoidance of Section 7(e) hereof.
(k) The term "Distribution Date" shall mean the close of business on the
date which is the earlier of the tenth Business Day following (x) the Share
Acquisition Date or (y) the Offer Commencement Date.
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(l) The term "Exempted Person" shall mean (i) Xxxxxxx X. Xxxxxxx; (ii) any
Immediate Relative of Xxxxxxx X. Xxxxxxx (defined as his spouse, any of his
children or any of their spouses, any of his grandchildren or any of their
spouses); or (iii) any trust, corporation, partnership, limited liability
company or other entity or organization controlled by Xxxxxxx X. Xxxxxxx or any
Immediate Relative of Xxxxxxx X. Xxxxxxx or in which Xxxxxxx X. Xxxxxxx or any
Immediate Relative of Xxxxxxx X. Xxxxxxx has any economic, beneficial or other
interest.
(m) The term "Offer Commencement Date" shall mean the date of the
commencement of a tender or exchange offer by any Person, other than the
Corporation, a Wholly Owned Subsidiary of the Corporation or any employee
benefit plan of the Corporation or of a Wholly Owned Subsidiary of the
Corporation if, upon consummation thereof, the Person and Affiliates thereof
would be the Beneficial Owner of 30% or more of the then outstanding Common
Shares (including any such date which is after the date of this Agreement and
prior to the issuance of the Rights).
(n) The term "Person" shall mean a corporation, association, partnership,
joint venture, trust, organization, business, limited liability company,
individual or government or any governmental agency or political subdivision
thereof, as well as any syndicate or group deemed to be a person under Section
14(d)(2) of the Exchange Act.
(o) The term "Preferred Shares" shall mean the Series A Participating
Preferred Shares, par value $.01 per share, of the Corporation, having the
rights and preferences set forth in the form of the Articles Supplementary
attached hereto as Exhibit A.
(p) The term "Share Acquisition Date" shall mean the first date of public
announcement by the Corporation or an Acquiring Person (or an Affiliate thereof)
that an Acquiring Person has become such (including the first date on which any
filing with any governmental authority disclosing that an Acquiring Person has
become such becomes available to the public).
(q) The term "Subsidiary" shall mean any person of which the Corporation
(or other specified parent) now or hereafter shall directly, or indirectly
through a Subsidiary or Subsidiaries, at the time own at least a majority of the
outstanding capital stock (or other shares of beneficial interest) entitled to
vote generally, or hold at least a majority of partnership or similar interests,
or be a general partner. The term "Wholly Owned Subsidiary" shall mean any
Subsidiary of which (i) all of the outstanding capital stock (or other shares of
beneficial interest) entitled to vote generally other than directors' qualifying
shares, is owned by the Corporation (or other specified Person) directly, or
indirectly through one or more Wholly Owned Subsidiaries, or (ii) the sole
general partner is the Corporation.
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(r) The following terms defined elsewhere in this Agreement in the Sections
set forth below shall have the respective meanings therein defined:
Term Definition
---- ----------
"Act" Section 9(e)
"Class A Common Shares" Preamble
"Closing Price" Section 11(d)
"Common Share Equivalents" Section 11(a)(iii)
"Corporation" Preamble
"current market price" Section 11(d)
"Current Value" Section 11(a)(iii)
"Equivalent Preferred Share" Section 11(b)
"Excess Amount" Section 11(a)(iii)
"Exchange Act" Section l(b)
"Expiration Date" Section 7(a)
"Officers' Certificate" Section 20(b)
"Original Common Shares" Preamble
"Other Consideration" Section 6(a)
"Purchase Price" Section 4(a)
"Redemption Price" Section 23
"Right Certificate" Section 3(a)
"Rights" Preamble
"Rights Agent" Preamble; Section 21
"Substitution Period" Section 11(a)(iii)
"Trading Day" Section 11(d)
SECTION 2. EFFECTIVENESS OF AGREEMENT; APPOINTMENT OF RIGHTS AGENT.
The Corporation and the Rights Agent hereby agree that the effective date
of this Agreement shall be the Declaration Date. The Corporation hereby appoints
the Rights Agent to act as agent for the Corporation, and the Rights Agent
hereby accepts such appointment upon the terms and conditions hereof. With the
consent of the Rights Agent, the Corporation may from time to time appoint such
co-Rights Agents as it may deem necessary or desirable. The Rights Agent shall
have no duty to supervise, and shall in no event be liable for, the acts or
omissions of any such co-Rights Agent.
SECTION 3. ISSUE OF RIGHT CERTIFICATES.
(a) Until the Distribution Date (i) the Rights will be evidenced (subject
to the provisions of Section 3(b) hereof) by the certificates representing the
Common Shares registered in the names of the holders of the Common Shares (which
certificates shall be deemed also to be certificates for the associated Rights)
and not by separate Right Certificates and (ii) the Rights will be transferable
only in connection with the transfer of the associated Common Shares. The
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Corporation shall give the Rights Agent prompt written notice of the
Distribution Date. As soon as practicable after the Distribution Date, and
receipt of written notice of the Distribution Date from the Corporation, the
Rights Agent will, at the Corporation's expense, send, by first-class, postage
prepaid mail, to each record holder of Common Shares as of the close of business
on the Distribution Date, at the address of such holder shown on the register of
shares of the Corporation, a right certificate, in substantially the form of
Exhibit B hereto (a "Right Certificate"), evidencing that number of Rights to
which such holder is entitled in accordance with the provisions of this
Agreement. In the event that an adjustment in the number of Rights per Common
Share has been made pursuant to Sections 11(i) or 11(o) hereof, at the time of
distribution of the Right Certificates the Corporation shall make the necessary
and appropriate rounding adjustments (in accordance with Section 14(a) hereof)
so that 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. The Rights are exercisable only in accordance with the provisions
of Section 7 hereof and are redeemable only in accordance with Section 23
hereof.
(b) Until the earlier of the Distribution Date and the Expiration Date, the
surrender for transfer of any of the certificates representing Common Shares
outstanding on the Declaration Date shall also constitute the transfer of the
Rights associated with the Common Shares represented by such certificate.
(c) Rights shall be issued in respect of all Common Shares issued after the
Declaration Date but prior to the earlier of the Distribution Date and the
Expiration Date. Certificates representing such Common Shares and certificates
issued on transfer of Common Shares after the Declaration Date but prior to the
earlier to occur of the dates mentioned in the preceding sentence shall be
deemed also to be certificates for the associated Rights, and shall bear the
following legend (or a legend substantially in the form thereof):
This certificate also evidences and entitles the holder hereof to
certain Rights as set forth in a Rights Agreement between the
issuer and The Bank of New York, as Rights Agent (the "Rights
Agent"), dated as of July 31, 1998 (the "Rights Agreement"), the
terms of which are hereby incorporated herein by reference and a
copy of which is on file at the principal offices of the issuer
and the designated office of the Rights Agent. 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 Corporation will mail to the
holder of this certificate a copy of the Rights Agreement without
charge promptly after receipt of a written request therefor.
Under certain circumstances as set forth in the Rights Agreement,
Rights issued to or held by any Person who is, was or becomes an
Acquiring Person or any Affiliate thereof (as each such term is
defined in the Rights Agreement), whether currently held by or on
behalf of such Person or by certain subsequent holders, may
become null and void.
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With respect to certificates representing Common Shares (whether or not such
certificates include the foregoing legend) until the earlier of the Distribution
Date and the Expiration Date, the Rights associated with the Common Shares
represented by such certificates shall be evidenced by such certificates alone,
and the surrender for transfer of any of such certificates shall also constitute
the transfer of the Rights associated with the Common Shares represented by such
certificate.
(d) In addition, the Corporation agrees to issue one Right (as such number
may be adjusted in accordance with Sections 11(c) or 11(n) hereof) in
conjunction with the issuance of any Common Shares reserved for issuance on the
Distribution Date and issued (i) on or after the Distribution Date and (ii)
prior to the Expiration Date (such Rights to be issued to the Person to whom
such Common Shares are issued).
SECTION 4. FORM OF RIGHT CERTIFICATES.
(a) The Right Certificates (and the form of assignment and the form of
election to purchase and certificate to be printed on the reverse thereof) shall
each be substantially in the form set forth in Exhibit B hereto and may have
such marks of identification or designation and such legends, summaries or
endorsements printed thereon as the Corporation may deem appropriate and as are
not inconsistent with the provisions of this Agreement, or as may be required to
comply with any applicable law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any stock exchange on which the Rights
may from time to time be listed, or to conform to usage. The Right Certificates
shall be in a machine printable format and in a form reasonably satisfactory to
the Rights Agent. Subject to the provisions of Sections 11 and 22 hereof, the
Right Certificates, whenever distributed, shall be dated as of the Declaration
Date, show the date of countersignature, and on their face shall entitle the
holders thereof to purchase such number of one one-hundredths of a Preferred
Share as shall be set forth therein at a price of $65 per each one-hundredth of
a share (the "Purchase Price"), but the amount and type of securities issuable
upon the exercise of each Right and the Purchase Price shall be subject to
adjustment as provided herein.
(b) Any Right Certificate issued pursuant to Sections 3(a) or 22 hereof
that represents Rights beneficially owned by (i) any Acquiring Person or
Affiliate of an Acquiring Person or (ii) any Disqualified Transferee, and any
other Right Certificate issued pursuant to Section 6 or 11 hereof upon the
transfer, exchange, replacement or adjustment of any such Right Certificate
shall contain (to the extent feasible) the following legend:
The Rights represented by this Right Certificate are or were
beneficially owned by a Person who was or became an Acquiring
Person or an Affiliate of an Acquiring Person (as each such term
is defined in the Rights Agreement). Accordingly, this Right
Certificate and the Rights represented hereby may become null and
void in the circumstances specified in Section 7(e) of the Rights
Agreement.
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The Corporation shall instruct the Rights Agent in writing of the Rights
which should be so legended and shall supply the Rights Agent with such legended
Right Certificates.
SECTION 5. COUNTERSIGNATURE AND REGISTRATION.
The Right Certificates shall be executed on behalf of the Corporation by
its Chairman of the Board, its President or any Vice President, either manually
or by facsimile signature, and shall have affixed thereto the Corporation's seal
or a facsimile thereof which shall be attested by the Secretary or an Assistant
Secretary of the Corporation, 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
Corporation who shall have signed any of the Right Certificates shall cease to
be such officer of the Corporation before countersignature by the Rights Agent
and issuance and delivery by the Corporation, 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 Corporation; and any Right
Certificate may be signed on behalf of the Corporation by any person who, at the
actual date of the execution of such Right Certificate, shall be a proper
officer of the Corporation to sign such Right Certificate, although at the date
of the execution of this Rights Agreement any such person was not such an
officer.
Following the Distribution Date, the Rights Agent will keep or cause to be
kept, at that office of the Rights Agent designated for such purpose, 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 and the date of countersignature thereof by the Rights Agent.
SECTION 6. TRANSFER, SPLIT UP, COMBINATION AND EXCHANGE OF RIGHT CERTIFICATES;
MUTILATED, DESTROYED, LOST OR STOLEN RIGHT CERTIFICATES.
(a) Subject to the provisions of Sections 4(b), 7(e) and 14 hereof, at any
time after the close of business on the Distribution Date, and at or prior to
the Expiration Date, any Right Certificate or Right Certificates may be
transferred, split up, combined or exchanged for another Right Certificate or
Right Certificates entitling the registered holder to purchase a like number of
one one-hundredths of a Preferred Share (or, following a Common Share Event,
Common Shares and/or such other securities, cash or other property as shall be
issuable in respect of the Rights in accordance with the terms of this Agreement
(such other securities, cash or other property being referred to herein as
"Other Consideration")), as the Right Certificate or Right Certificates
surrendered then entitled such holder to purchase. Any registered holder
desiring to transfer, split up, combine or exchange any Right Certificate 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 with the form of assignment and certificate appropriately
completed and executed, at the office of the Rights Agent designated
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for such purpose. Thereupon, subject to Sections 4(b) and 7(e) hereof, the
Corporation shall execute and the Rights Agent countersign and deliver to the
person entitled thereto a Right Certificate or Right Certificates, as the case
may be, as so requested. The Corporation may require payment by the holders of
Rights 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 which the Corporation is not required to pay in accordance
with Section 9(d) hereof.
(b) Upon receipt by the Corporation 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 satisfactory to them, and, in case of mutilation, upon surrender to the
Rights Agent and cancellation of the mutilated Right Certificate and, in any
case, upon reimbursement to the Corporation and the Rights Agent of all
reasonable expenses incidental thereto, the Corporation will execute 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 DATE OF RIGHTS.
(a) Except as otherwise provided herein, the registered holder of any Right
Certificate may exercise the Rights evidenced thereby in whole or in part at any
time from and after the Distribution Date and prior to the earliest of (i) the
close of business on November 12, 2008 (which date may be extended Pursuant to
Section 26) or (ii) the time at which the Rights are redeemed as provided in
Section 23 hereof (such earlier time being herein referred to as the "Expiration
Date"). At the Expiration Date, all rights will be extinguished and all Right
Certificates shall become null and void. To exercise Rights, the registered
holder of the Right Certificate evidencing such Rights shall surrender such
Right Certificate, with the form of election to purchase and certificate on the
reverse side thereof duly executed, to the Rights Agent at the office of the
Rights Agent designated for such purpose, together with payment in cash, or by
certified check or bank check, of the Purchase Price with respect to the total
number of one one-hundredths of a Preferred Share (or, after a Common Share
Event, Common Shares and/or Other Consideration) as to which the Rights are
exercised (which payment shall include any additional amount payable by such
Person in accordance with Section 9(d) hereof). The Rights Agent shall promptly
deliver to the Corporation all payments of the Purchase Price received in
respect of Right Certificates accepted for exercise.
(b) The Purchase Price for each one-hundredth of a Preferred Share issuable
pursuant to the exercise of a Right shall initially be $65, shall be subject to
adjustment as provided in Section 11 hereof and shall be payable in lawful money
of the United States of America.
(c) Upon receipt of a Right Certificate representing the Rights, with the
form of election to purchase and certificate set forth on the reverse side
thereof duly executed, accompanied by payment of the Purchase Price and an
amount equal to any applicable transfer
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tax or evidence satisfactory to the Corporation of payment of such tax, the
Rights Agent, subject to Section 7(e), Section 11(a)(iii) and Section 20(k)
hereof, shall thereupon promptly (i) if prior to a Common Share Event,
requisition from any transfer agent of the Preferred Shares (or from the
Corporation if there shall be no such transfer agent, or make available if the
Rights Agent is such transfer agent) certificates for the total number of one
one-hundredths of a Preferred Share to be purchased and the Corporation hereby
irrevocably authorizes such transfer agent to comply with any such request, or
if after a Common Share Event, requisition from the appropriate person required
to issue or deliver the Common Shares or Other Consideration issuable pursuant
to Section 11(a)(ii) or Section 13 certificates evidencing, or other evidence
of, such Common Shares or Other Consideration, (ii) after receipt of such
certificates or Other Consideration, 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 (iii) when appropriate,
requisition from the Corporation or other appropriate Person the amount of cash
to be paid in lieu of issuance of a fractional share in accordance with Section
14 hereof and after receipt promptly deliver such cash to or upon the order of
the registered holder of such Right Certificate. After the occurrence of a
Common Share Event, the Corporation will make all necessary arrangements so that
the Common Shares and/or Other Consideration then deliverable in respect of the
Rights are available for distribution by the Rights Agent. For purposes of this
Section 7, the Rights Agent shall be entitled to conclusively rely, and shall be
fully protected in conclusively relying, on an Officers' Certificate from the
Corporation to the effect that the Distribution Date has occurred.
(d) Subject to Sections 4(b), 7(e) and 14 hereof, 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 executed and delivered by the Corporation
to the Rights Agent and countersigned and delivered by the Rights Agent to the
registered holder of such Right Certificate or to his duly authorized assigns.
(e) Notwithstanding anything in this Agreement to the contrary, from and
after the first occurrence of a Common Share Event, any Rights beneficially
owned by (i) an Acquiring Person, (ii) an Affiliate of an Acquiring Person or
(iii) a Disqualified Transferee 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 or
otherwise. The Corporation shall use all reasonable efforts to ensure that the
provisions of this Section 7(e) and Section 4(b) hereof are complied with, but
shall have no liability to any holder of Right Certificates or other Person as a
result of its failure to make any determinations with respect to an Acquiring
Person or its Affiliates or Disqualified Transferees hereunder.
(f) Notwithstanding anything in this Agreement or any Right Certificate to
the contrary, neither the Rights Agent nor the Corporation shall be obligated to
undertake any action with respect to a registered holder of any Right
Certificate upon the occurrence of any purported exercise thereof unless such
registered holder shall have (i) completed and signed the certificate following
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
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Beneficial Owner (or former Beneficial Owner) or Affiliates thereof as the
Corporation shall reasonably request.
SECTION 8. CANCELLATION OF RIGHT CERTIFICATES.
All Right Certificates surrendered for the purpose of and accepted for
exercise, or surrendered for the purpose of redemption, transfer, split up,
combination or exchange shall, if surrendered to the Corporation or to any of
its agents (other than the Rights Agent), be delivered to the Rights Agent for
cancellation or in cancelled form, or, if surrendered to the Rights Agent, shall
be cancelled 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
Rights Agent shall deliver all cancelled Right Certificates to the Corporation.
SECTION 9. RESERVATION AND AVAILABILITY OF SHARES; COVENANTS.
(a) The Corporation covenants and agrees as long as any of the Rights are
outstanding, it will cause to be reserved and kept available out of its
authorized and unissued Preferred Shares (or, following the occurrence of a
Common Share Event, out of its authorized and unissued shares or similar units
of Common Shares and/or other securities, or out of its authorized and issued
securities held in its treasury), the number of Preferred Shares (or, following
the occurrence of a Common Share Event, shares or units of Common Shares and/or
other securities) that, except as provided in Section 11(a)(ii) hereof, would
then be sufficient to permit the exercise in full of all outstanding Rights.
(b) The Corporation covenants and agrees that on and after the Distribution
Date so long as the Preferred Shares (or, following the occurrence of a Common
Share Event, the Common Shares or other securities) issuable upon the exercise
of Rights may be listed on any national securities exchange, the Corporation
shall use its best efforts to cause all shares (or similar units) reserved for
such issuance to be listed on such exchange upon official notice of issuance
upon such exercise.
(c) The Corporation covenants and agrees that it will take all such action
as may be necessary to ensure that each one one-hundredth of a Preferred Share
(or, following the occurrence of a Common Share Event, each share and/or similar
unit of Common Shares or other securities) delivered upon exercise of Rights
shall, at the time of delivery of the certificates for such shares (or units),
subject to payment of the Purchase Price, be duly and validly authorized and
issued and fully paid and nonassessable.
(d) The Corporation 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 or
of any Preferred Shares (or, following the occurrence of a Common Share Event,
any shares and/or similar units of Common Shares or other securities) upon the
exercise of Rights; provided, however, that the Corporation shall not be
required to pay any transfer tax which may be payable in respect of any transfer
involved
11
in the transfer or delivery of Right Certificates or in the issuance or delivery
of certificates for any number of one one-hundredths of a Preferred Share (or,
following the occurrence of a Common Share Event, shares and/or similar units of
Common Shares or other securities) in 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 a number of one one-hundredths of a
Preferred Share (and, following the occurrence of a Common Share Event, any
shares and/or similar units of Common Shares or other securities) 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 Corporation's satisfaction that no such
tax is due.
(e) The Corporation shall use its best efforts to (i) file, as soon as
practicable following the earliest date after the first occurrence of a Common
Share Event on which the consideration to be delivered by the Corporation upon
exercise of the Rights has been determined in accordance with 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 or (B) the
Expiration Date. The Corporation 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 Corporation may temporarily suspend the exercisability of the Rights in
order to prepare and file such registration statement. Upon any such suspension,
the Corporation shall issue a public announcement, in each case with
simultaneous written notice to the Rights Agent, stating that the exercisability
of the Rights has been temporarily suspended. The Corporation shall thereafter
issue a public announcement, in each case with simultaneous written notice to
the Rights Agent, at such time as the suspension is no longer in effect.
Notwithstanding any provision of this Agreement to the contrary, the Rights
shall not be exercisable in any jurisdiction unless the requisite qualification
in such jurisdiction shall have been obtained. The Rights Agent may assume that
any Right exercised is permitted to be exercised under applicable law and shall
have no liability for acting in reliance upon such assumption.
SECTION 10. PREFERRED SHARES RECORD DATE; ETC.
Each Person in whose name any certificate for any number of one
one-hundredths of a Preferred Share (or, following the occurrence of a Common
Share Event, shares and/or similar units of Common Shares or other securities)
is issued upon the exercise of Rights shall for all purposes be deemed to have
become the holder of record of such fractional shares of Preferred Shares (or
such shares and/or units of Common Shares or other securities, as the case may
be) represented thereby, and such certificate shall be dated, as of the date
which is the later of (i) the date upon which the Right Certificate evidencing
such Rights was duly surrendered or (ii)
12
the date upon which payment of the Purchase Price (and any applicable transfer
taxes) in respect thereof was made; provided, however, that if such date is a
date upon which the relevant transfer books of the Company are closed, such
Person shall be deemed to have become the record holder of such shares (or
units) on, and such certificate shall be dated, the next succeeding Business Day
on which such transfer books of the Corporation are open; and provided, further,
that the Corporation covenants and agrees that it shall not close such transfer
books for a period exceeding ten consecutive days. Prior to the exercise of the
Rights evidenced thereby (which shall be deemed to have occurred on the date
such certificate evidencing Preferred Shares, Common Shares or other securities
shall be dated in accordance with this Section 10), the holder of a Right
Certificate, as such, shall not be entitled to any rights of a security holder
of the Corporation with respect to securities 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 Corporation,
except as expressly provided herein.
SECTION 11. ANTIDILUTION ADJUSTMENTS.
The Purchase Price and the number and kind of securities 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 that the Corporation shall at any time after the date
of this Agreement (A) declare a dividend on the Preferred Shares payable in
shares of Preferred Shares, (B) subdivide the outstanding Preferred Shares,
(C) combine outstanding Preferred Shares into a smaller number of shares or
(D) issue, change or alter any shares of its beneficial interests in a
reclassification or recapitalization or (including any such
reclassification or recapitalization in connection with a consolidation or
merger in which the Corporation is the continuing or surviving entity)
except as otherwise provided in Section 7(e) then, and in each such case,
the Purchase Price in effect at the time of the record date for such
dividend or the effective time of such subdivision, combination,
reclassification or recapitalization, and the number and kind of Preferred
Shares or other shares of beneficial interests issuable at such time, shall
be proportionately adjusted so that the holder of any Right exercised after
such time shall be entitled to receive the aggregate number and kind of
Preferred Shares or other shares of beneficial interests which, if such
Right had been exercised immediately prior to such time and at a time when
the Preferred Shares register or other transfer books of the Corporation
were open, such holder would have owned upon such exercise and been
entitled to receive by virtue of such dividend, subdivision, combination,
reclassification or recapitalization. If an event occurs which would
require an adjustment under both this Section 11(a)(i) and Section
11(a)(ii) hereof, the adjustment provided in this Section 11(a)(i) shall be
in addition to, and shall be made prior to, any adjustment required
pursuant to Section 11(a)(ii).
13
(ii) In the event
(A) any Acquiring Person or any Affiliate of any Acquiring
Person, at any time after the date of this Agreement, directly or
indirectly (1) shall merge into the Corporation or otherwise combine
with the Corporation, the Corporation shall be the continuing or
surviving entity of such merger or combination and the Original Common
Shares shall remain outstanding and no shares thereof shall be changed
or otherwise transformed into stock or other securities of any other
Person or the Corporation or cash or any other property, (2) shall, in
one or more transactions, transfer any assets to the Corporation or
any Subsidiary in exchange (in whole or in part) for shares of any
class of its equity securities or for securities exercisable for or
convertible into shares of any such class or otherwise obtain from the
Corporation or any Subsidiary, with or without consideration, any
additional shares of any such class or securities exercisable for or
convertible into shares of any such class (other than as part of a pro
rata distribution to all holders of such class), (3) shall sell,
purchase, lease, exchange, mortgage, pledge, transfer or otherwise
acquire or dispose of (in one transaction or a series of
transactions), to, from or with the Corporation or any of the
Corporation's Subsidiaries or any employee benefit plan maintained by
the Corporation or any Subsidiary or any trustee or fiduciary with
respect to such plan acting in such capacity, assets including
securities on terms and conditions less favorable to the Corporation
or such Subsidiary or plan than the Corporation or such Subsidiary or
plan would be able to obtain through arm's-length negotiation with an
unaffiliated third party (other than pursuant to a transaction set
forth in Section 13(a) hereof), (4) shall engage in any transaction
with the Corporation or such Subsidiary or plan not in the ordinary
course of the Corporation's business involving the sale, purchase,
lease, exchange, mortgage, pledge, transfer or other disposition (in
one transaction or a series of transactions) of assets having an
aggregate fair market value of more than $500,000 (other than pursuant
to a transaction set forth in Section 13(a) hereof), (5) shall receive
any compensation from the Corporation or any of the Corporation's
Subsidiaries other than compensation for full-time employment as a
regular employee at rates in accordance with the Corporation's (or
such Subsidiary's) past practices or (6) shall receive the benefit
directly or indirectly (except proportionately as a stockholder) of
any loans, advances, guarantees, pledges or other financial assistance
or any tax credits or other tax advantage provided by the Corporation
or any of its Subsidiaries or any employee benefit plan maintained by
the Corporation or any Subsidiary or any trustee or fiduciary with
respect to such plan acting in such capacity;
(B) any Person (other than the Corporation, any Subsidiary of the
Corporation, any employee benefit plan of the Corporation or of any
Subsidiary of the Corporation, or any Person or entity organized,
appointed or established by the Corporation for or pursuant to the
terms of any such plan or any Exempted
14
Person), alone or together with its Affiliates, shall, at any time on
or after the Declaration Date, become the Beneficial Owner of 10% or
more of the total combined voting power of the Common Shares then
outstanding other than pursuant to a transaction to which the
provisions of Section 13(a) apply; or
(C) during such time as there is an Acquiring Person, there shall
be any reclassification of securities (including any combination
thereof), or recapitalization of the Corporation, or any merger or
consolidation of the Corporation with any of its Subsidiaries, or any
repurchase by the Corporation or any of its Subsidiaries of the Common
Shares, or any other class or series of securities issued by the
Corporation (whether or not with or into or otherwise involving an
Acquiring Person or any Affiliate of an Acquiring Person), which has
the effect, directly or indirectly, of increasing by more than 1% the
proportionate share of the outstanding shares of any class of equity
securities or securities exercisable for or convertible into any class
of equity securities of the Corporation or any of its Subsidiaries
which is directly or indirectly beneficially owned by an Acquiring
Person or any Affiliate of an Acquiring Person;
then, and in each such case, proper provision shall be made so that
each holder of a Right, except as provided in Section 7(e) hereof,
shall thereafter have the right to receive, upon exercise thereof at
the then current Purchase Price in accordance with the terms of this
Agreement, in lieu of the number of one one-hundredths of a Preferred
Share for which a Right was exercisable immediately prior to the
occurrence of an event described in this Section 11(a)(ii), such
number of Original Common Shares as shall equal the result obtained by
(x) multiplying an amount equal to the then current Purchase Price by
an amount equal to the number of one one-hundredths of a Preferred
Share for which a Right was exercisable immediately prior to the first
occurrence of any such event, and dividing that product by (y) 50% of
the current market price per Original Common Share of the Corporation
(as defined in Section 11(d) hereof) determined as of the date of such
first occurrence.
(iii) In the event that the number of Original Common Shares which are
authorized by the Corporation's Articles of Incorporation but not
outstanding or reserved for issuance for purposes other than upon
exercise of the Rights are not sufficient to permit the exercise in
full of the Rights in accordance with Section 11(a)(ii) hereof, in
lieu of issuing Original Common Shares in accordance with Section
11(a)(ii) the Corporation shall (A) determine an amount (the "Excess
Amount") equal to the excess of (1) the value (the "Current Value") of
the Original Common Shares issuable upon the exercise of a Right in
accordance with Section 11(a)(ii) hereof, over (2) the Purchase Price
and (B) with respect to each Right, make adequate provision to
substitute for such Original Common Shares, upon payment of the
applicable Purchase Price, (1) cash, (2) a reduction in the Purchase
Price, (3) Common Shares or other equity securities of the Corporation
15
(including, without limitation, shares or units of preferred shares
which the Directors of the Corporation have deemed, in good faith, to
have the same value as an Original Common Share (such preferred shares
hereinafter referred to as "Common Share Equivalents")), (4) debt
securities of the Corporation, (5) other assets or (6) any combination
of the foregoing having an aggregate value equal to the Current Value,
where such aggregate value has been determined by the Directors of the
Corporation, in good faith, based upon the advice of a nationally
recognized investment banking firm selected by the Directors of the
Corporation; provided, however, subject to the provisions of Section
9(e), if the Corporation shall not have made adequate provision to
deliver value pursuant to clause (B) above within 30 days following
the first occurrence of a Common Share Event, then the Corporation
shall be obligated to deliver, upon the surrender for exercise of a
Right and without requiring payment of the Purchase Price, Original
Common Shares (to the extent available) and then, if necessary, cash,
securities and/or assets which in the aggregate are equal to the
Excess Amount. If the Directors of the Corporation shall determine in
good faith that it is likely that sufficient additional Original
Common Shares could be authorized for issuance upon exercise in full
of the Rights, the 30-day period set forth above may be amended to the
extent necessary, but not more than 90 days following the first
occurrence of such a Common Share Event, in order that the Corporation
may seek shareholder approval for the authorization of such additional
shares (such 30-day period, as it may be extended to 90 days, is
referred to herein as the "Substitution Period"). To the extent that
the Corporation determines that some action is to be taken pursuant to
the first and/or second sentences of this Section 11(a)(iii), the
Corporation (x) shall provide, subject to Section 7(e) hereof, that
(except as shall be determined by a majority of the Directors) such
action shall apply uniformly to all outstanding Rights which shall not
have become null and void and (y) may suspend the exercisability of
the Rights until the expiration of the Substitution Period in order to
seek any authorization of additional shares and/or to decide the
appropriate form of distribution to be made pursuant to such first
sentence and to determine the value thereof. In the event of any such
suspension, the Corporation shall issue a public announcement stating
that the exercisability of the Rights has been temporarily suspended.
The Corporation shall thereafter issue a public announcement at such
time as the suspension is no longer in effect. For purposes of this
Section 11(a)(iii), the value of Common Shares shall be the current
market price per Common Share (as determined pursuant to Section 11(d)
hereof) on the date of the first occurrence of such a Common Share
Event.
(b) In the event the Corporation shall after the Declaration Date fix a
record date for the issuance of any options, warrants or other rights to all
holders of Preferred Shares entitling them (for a period expiring within 45
calendar days after such record date) to subscribe for or purchase Preferred
Shares (or (i) shares having the same rights, privileges and preferences as the
shares of any number of one one-hundredths of a Preferred Share ("Equivalent
Preferred
16
Shares") or (ii) securities convertible into Preferred Shares (or Equivalent
Preferred Shares)), at a purchase price per share of Preferred Shares or
Equivalent Preferred Shares (or having a conversion price per Preferred Share or
Equivalent Preferred Share, if a security is convertible into Preferred Shares
or Equivalent Preferred Shares) less than the current market price per share of
Preferred Share (determined in accordance with Section 11(d) hereof) determined
as of 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 record date by a fraction, the numerator of which shall be the
number of Preferred Shares outstanding on such record date plus the number of
Preferred Shares and/or Equivalent Preferred Shares which the aggregate minimum
offering price of the total number of one one-hundredths of a Preferred Share
and/or per Equivalent Preferred Share so to be offered (and/or the aggregate
minimum conversion price of such convertible securities so to be offered) would
purchase at such current market price and the denominator of which shall be the
number of Preferred Shares outstanding on such record date plus the maximum
number of additional Preferred Shares and/or Equivalent Preferred Shares to be
offered for subscription or purchase (or the maximum number of shares into which
such convertible securities so to be offered are convertible). In case such
subscription price may be paid in a consideration part or all of which shall be
in a form other than cash, for purposes of this Section 11(b) the value of such
consideration shall be the fair market value thereof as determined in good faith
by the Directors of the Corporation (which determination shall be described in
an Officers' Certificate filed with the Rights Agent). Preferred Shares owned by
or held for the account of the Corporation 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 (subject, however, to such other adjustments as are provided herein).
(c) In the event that the Corporation shall after the Declaration Date fix
a record date for the making of a distribution to all holders of Preferred
Shares (including any such distribution made in connection with a consolidation
or merger in which the Corporation is the surviving or continuing entity) of
evidences of indebtedness, cash (other than regular quarterly cash dividends),
other property (other than a dividend payable in a number of one one-hundredths
of a Preferred Share, but including any dividend payable in shares other than
Preferred Shares) or subscription rights or warrants (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, of which the numerator
shall be the current market price per Preferred Share (as defined in Section
11(d) hereof) determined as of such record date, less the fair market value, as
determined in good faith by the Directors of the Corporation (which
determination shall be described in an Officers' Certificate filed with the
Rights Agent) of that portion of such evidences of indebtedness, such other
property and/or such subscription rights or warrants applicable to one Preferred
Share and of which the denominator shall be such current market price per
Preferred Share. Such adjustments shall be made successively whenever such a
record date is fixed; and in the event such distribution is not so made, the
Purchase Price shall again be adjusted to be
17
the Purchase Price which would then be in effect if such record date had not
been fixed (subject, however, to such other adjustments as are provided herein).
(d) For the purposes of any computation hereunder, the "current market
price" per share (or unit) of any security on any date shall be deemed to be the
average of the daily Closing Price of such security for the 20 consecutive
Trading Days immediately prior to such date; provided, however, that in the
event that the current market price per share of such security is determined
during a period following or including the announcement by the issuer of such
security of (i) a dividend or distribution on such security payable in shares
(or units) of such security or securities convertible into shares (or units) of
such security or (ii) any subdivision, combination or reclassification of such
security, and prior to the expiration of 20 Trading Days after (A) the
ex-dividend date for such dividend or distribution, or (B) the record date for
such subdivision, combination or reclassification, as the case may be, then, and
in each such case, the "current market price" shall be the Closing Price of such
security on the last day of such 20 Trading Day period. The term "Trading Day"
shall mean a day on which the principal national securities exchange on which
such security is listed or admitted to trading is open for the transaction of
business or, if such security is not listed or admitted to trading on any
national securities exchange, a Business Day. For purposes of this Agreement,
the "Closing Price" of any security on any day shall be the last sale price,
regular way, with respect to shares (or units) of such security, or, in case no
such sale takes place on such day, the average of the closing bid and asked
prices, regular way, with respect to such security, 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
such security is 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 such security is listed or admitted to trading; or, if such security is
not so listed or admitted to trading, the last quoted price with respect to
shares (or units) of such security, or, if not so quoted, the average of the
high bid and low asked prices in the over-the-counter market with respect to
shares (or units) of such security, as reported by the National Association of
Securities Dealers, Inc. Automated Quotation System or such other similar system
then in use; or, if on any such date such security is not quoted by any such
organization, the average of the closing bid and asked prices with respect to
shares (or units) of such security, as furnished by a professional market maker
making a market in such security selected by the Directors of the Corporation in
good faith; or, if no such market maker is available, the fair market value of
shares (or units) of such security as of such day as determined in good faith by
the Directors of the Corporation (which determination shall be described in an
Officers' Certificate filed with the Rights Agent); provided, however, that if
the Closing Price of a Preferred Share as of any Trading Day cannot be
reasonably determined by the foregoing provisions, the "Closing Price" of one
one-hundredth of a Preferred Share on such Trading Day shall be the average of
the Closing Prices of a Class A Common Share and an Original Common Share on
such Trading Day.
(e) No adjustment in the Purchase Price shall be required unless adjustment
would require an increase or decrease of at least 1% in such price; provided,
however, that any
18
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 (x) ten-thousandth of a Common Share or securities other than
Preferred Shares or Equivalent Preferred Shares or (y) one-millionth of a
Preferred Share or Equivalent Preferred Share. Notwithstanding the first
sentence of this Section 11(e), any adjustment required by this Section 11
hereof shall be made no later than the earlier of (i) three years from the date
of the transaction which mandates the adjustment or (ii) the Expiration Date.
(f) In the event that at any time, as a result of an adjustment made in
respect of a Common Share Event, the holder of any Right thereafter exercised
shall become entitled to receive any shares of capital stock of the Corporation
other than Preferred Shares, thereafter the number of such other shares so
receivable upon exercise of any Right 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 such other shares contained in Sections 11(a), (b),
(c), (e), (g), (h), (i), (j), (k) and (m) hereof, and the provisions of Sections
7, 9, 10, 11(d) and 13 hereof with respect to the Preferred Shares shall apply
on like terms to any such other shares.
(g) All Right Certificates originally issued by the Corporation subsequent
to any adjustment made to the Purchase Price hereunder shall evidence the right
to purchase, at the adjusted Purchase Price, the number of one one-hundredths of
a Preferred Share purchasable from time to time hereunder upon exercise of the
Rights represented thereby, all subject to further adjustment as provided
herein.
(h) Unless the Corporation shall have exercised its election as provided in
Section 11(i) hereof, upon each adjustment of the Purchase Price as a result of
the calculations made pursuant to Sections 11(b) and 11(c) hereof, each Right
outstanding immediately prior to the making of such adjustment shall thereafter
evidence the right to purchase, at the adjusted Purchase Price, that number of
one one-hundredths of a Preferred Share (calculated to the nearest
one-millionth) obtained by (i) multiplying (x) the number of one one-hundredths
of a Preferred Share covered by a Right immediately prior to this adjustment by
(y) the Purchase Price in effect immediately prior to such adjustment and (ii)
dividing the product so obtained by the Purchase Price in effect immediately
after such adjustment of the Purchase Price.
(i) The Corporation may elect on or after the date of any adjustment of the
Purchase Price to adjust the number of Rights in substitution for any adjustment
in the number of one one-hundredths of a Preferred Share 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 one one-hundredths of a
Preferred Share for which a Right was exercisable immediately prior to such
adjustment. Each Right held of record prior to such adjustment of the number of
Rights shall become that number of Rights (calculated to the nearest
ten-thousandth) obtained by dividing (x) the Purchase Price in effect
immediately prior to such adjustment by (y) the Purchase Price in effect
immediately after such adjustment of the Purchase Price. The Corporation shall
make a public announcement of its election to adjust the number of Rights,
19
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
Corporation 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 Corporation, 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
Corporation, 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 Corporation, 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 Preferred Shares issuable upon exercise of such Rights, the Right
Certificates theretofore and thereafter issued may continue to express the
Purchase Price per one one-hundredth of a Preferred Share and such number of one
one-hundredths of a Preferred Share 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 of the Preferred Shares times a fraction
the numerator of which is the number of one one-hundredths of a Preferred Share
issuable upon exercise of the Rights and the denominator of which is one
hundred, the Corporation shall take any corporate action which may, in the
opinion of its counsel, be necessary in order that the Corporation may validly
and legally issue fully paid and nonassessable such number of one one-hundredths
of a Preferred Share 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 Corporation may elect to defer until the occurrence of such event the
issuing to the holder of any Right exercised after such record date the number
of one one-hundredths of a Preferred Share and other beneficial shares or
securities of the Corporation, if any, issuable upon such exercise over and
above the number of one one-hundredths of a Preferred Share and other beneficial
shares or securities of the Corporation, if any, issuable upon such exercise on
the basis of the Purchase Price in effect prior to such adjustment; provided,
however, that the Corporation shall deliver to such holder a due xxxx or other
appropriate instrument evidencing such holder's right to receive such additional
securities upon the occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary notwithstanding, the
Corporation shall be entitled to make such reductions in the Purchase Price, in
addition to those adjustments
20
expressly required by this Section 11, as and to the extent that it, by means of
a resolution of the Directors acting in good faith, shall determine to be
advisable in order that any consolidation or subdivision of the Preferred
Shares, issuance wholly for cash of any Preferred Shares at less than the
current market price thereof, issuance wholly for cash of Preferred Shares or
other securities which by their terms are convertible into or exchangeable for
Preferred Shares, share dividends or issuance of rights, options or warrants
referred to hereinabove in this Section 11, hereafter made or declared by the
Corporation to the holders of its Preferred Shares, shall not be taxable to such
holders or shall reduce the taxes payable by such holders.
(n) The Corporation covenants and agrees that it shall not at any time
after the Distribution Date, (i) consolidate with any other Person (other than a
Subsidiary of the Corporation in a transaction which complies with Section 11(p)
hereof), (ii) merge with or into any other Person (other than a Subsidiary of
the Corporation in a transaction which complies with Section 11(p) hereof) or
(iii) sell or transfer (or permit any Subsidiary to sell or transfer), in one
transaction or a series of related transactions, assets or earning power
aggregating more than 50% of the assets (taken at asset value as stated on the
books of the Corporation determined in accordance with generally accepted
accounting principles consistently applied) or earning power of the Corporation
(on an individual basis) or the Corporation and its Subsidiaries (on a
consolidated basis) to any other Person or Persons (other than the Corporation
or any of its Subsidiaries in one or more transactions each of which complies
with Section 11(p) hereof), if at the time of or immediately after such
consolidation, merger or sale there are any rights, warrants or other
instruments or securities outstanding or agreements or arrangements in effect
which would substantially diminish or otherwise eliminate the benefits intended
to be afforded by the Rights.
(o) Anything in this Agreement to the contrary notwithstanding, in the
event that the Corporation shall at any time after the Declaration Date and
prior to the Distribution Date (i) declare a dividend on the outstanding Common
Shares payable in Common Shares, (ii) subdivide the outstanding Common Shares,
(iii) combine the outstanding Common Shares into a smaller number of shares or
(iv) issue any of its beneficial shares in a reclassification of the outstanding
Common Shares (including any such reclassification in connection with a
consolidation or merger in which the Corporation is the continuing or surviving
entity), the number of Rights associated with each Common Share or other such
beneficial shares 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 Common Share or other such beneficial
shares following any such event shall equal the result obtained by multiplying
the number of Rights associated with each Common Share immediately prior to such
event by a fraction the numerator of which shall be the total number of Common
Shares outstanding immediately prior to the occurrence of the event and the
denominator of which shall be the total number of Common Shares outstanding
immediately following the occurrence of such event.
(p) After the Distribution Date, the Corporation shall not, except as
permitted by Section 23 or Section 26 hereof, take (or permit any Subsidiary to
take) any action if at the time
21
such action is taken it is reasonably foreseeable that such action will diminish
substantially or otherwise eliminate the benefits intended to be afforded by the
Rights.
SECTION 12. CERTIFICATE OF ADJUSTMENTS.
Whenever an adjustment is made as provided in Sections 11 or 13 hereof, the
Corporation shall (a) promptly prepare an Officers' Certificate setting forth
such adjustment and a brief statement of the facts accounting for such
adjustment, (b) promptly file with the Rights Agent and with each transfer agent
for the Preferred Shares and the Common Shares a copy of such Officers'
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 Common Shares) in accordance with Section 25 hereof.
The Rights Agent shall be fully protected in conclusively relying on any such
Officers' Certificate and on any adjustment therein contained, and shall not be
deemed to have knowledge of any such adjustment unless and until it shall have
actually received such an Officers' Certificate.
SECTION 13. CONSOLIDATION, MERGER OR SALE OR TRANSFER OF ASSETS OR EARNING
POWER.
In the event that, directly or indirectly, (a) the Corporation shall
consolidate with, or merge with and into, any other Person (other than a
Subsidiary of the Corporation in a transaction which complies with Section 11(p)
hereof), and the Corporation shall not be the continuing or surviving entity of
such consolidation or merger, (b) any Person (other than a Subsidiary of the
Corporation in a transaction which complies with Section 11(p) hereof) shall
consolidate with, or merge with and into the Corporation, the Corporation shall
be the continuing or surviving entity of such consolidation or merger and, in
connection with such consolidation or merger, all or part of the Original Common
Shares of the Corporation shall be changed or otherwise transformed into stock
or other securities of any other Person or the Corporation or cash or any other
property or (c) the Corporation 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 (A) the assets (taken at asset value as stated on the books of the
Corporation and determined in accordance with generally accepted accounting
principles consistently applied) or (B) the earning power, of the Corporation
(on an individual basis) or the Corporation and its Subsidiaries (on a
consolidated basis) to any other Person or Persons (other than the Corporation
or any of its Subsidiaries in one or more transactions each of which complies
with Section 11(p)), then, from and after such event, proper provision shall be
made so that (i) 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 one one-hundredths
of a Preferred Share for which a Right is then exercisable in accordance with
the terms of this Agreement, such number of shares of validly authorized and
issued, fully paid and non-assessable Common Stock of such other Person (or, in
the case of a transaction described in clause (b) above in which no Original
Common Shares are changed or otherwise transformed into stock or other
securities of any other Person, the Corporation, or, in the case of a
22
transaction or series of transactions described in clause (c) above, the Person
receiving the greatest amount of assets or earning power of the Corporation),
not subject to any loans, encumbrances, rights of first refusal or other adverse
claims, as shall be equal to the result obtained by (x) multiplying the Purchase
Price in effect immediately prior to the first occurrence of any Common Share
Event by the number of one one-hundredths of a Preferred Share for which a Right
is exercisable immediately prior to such first occurrence (and without taking
into account any prior adjustment made pursuant to Section 11(a)(ii)) and
dividing that product by (y) 50% of the current market price (as defined in
Section 11(d) hereof) per Common Stock of such other Person determined as of the
date of consummation of such consolidation, merger, sale or transfer; (ii) the
issuer of such Common Stock shall thereafter be liable for, and shall assume, by
virtue of such consolidation, merger, sale or transfer, all the obligations and
duties of the Corporation pursuant to this Agreement; (iii) the term
"Corporation" shall thereafter be deemed to refer to such issuer, it being
specifically intended that the provisions of Section 11 hereof (other than
Section 11(a)(ii) hereof) shall apply only to such issuer following the first
occurrence of a Common Share Event under this Section 13; (iv) such issuer shall
take such steps (including, but not limited to, the reservation of a sufficient
number of shares of its Common Stock) 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; and (v) the
provisions of Section 11(a)(ii) hereof shall be of no effect following the first
occurrence of any Common Share Event described in clauses (a), (b) or (c) of
this Section 13. In connection with any Common Share Event described in Section
13(a), (b) or (c) involving the Corporation and any other Person, if the Common
Stock of such other Person (the "Other Person") is not at such time and has not
been continuously over the preceding twelve-month period registered under
Section 12 of the Exchange Act ("Registered Common Stock") or the Other Person
is not a corporation, then the Rights (in lieu of being exercisable for the
Common Stock of the Other Person) shall become exercisable for the Common Stock
of one of the following different Persons:
(1) if the Other Person is a direct or indirect subsidiary of a Person that
has Registered Common Stock outstanding, then the Rights shall become
exercisable for the Common Stock of such Person;
(2) if the Other Person is a direct or indirect Subsidiary of a Person (but
is not a direct or indirect Subsidiary of a Person which has Registered Common
Stock outstanding), then the Rights shall become exercisable for the Common
Stock of the ultimate parent entity of the Other Person;
(3) if the Other Person is directly or indirectly controlled by more than
one Person, and one or more of such Persons has Registered Common Stock
outstanding, then the Rights shall become exercisable for the Common Stock of
whichever of such other Persons is the issuer of the Registered Common Stock
having the highest aggregate current market price (determined pursuant to
Section 11(d) hereof); and
23
(4) if the Other Person is directly or indirectly controlled by more than
one Person, and none of such Persons has Registered Common Stock outstanding,
then the Rights shall become exercisable for the Common Stock of whichever
ultimate parent entity is the corporation having the greatest stockholders
equity or, if no such ultimate parent entity is a corporation, shall refer to
whichever ultimate parent entity is the entity having the greatest net assets.
The Corporation shall not consummate any such consolidation, merger, sale
or transfer unless (i) such issuer shall have a sufficient number of authorized
shares of its Common Stock which have not been issued or reserved for issuance
as will permit the exercise in full of the Rights in accordance with this
Section 13 and (ii) prior thereto the Corporation and such issuer shall have
executed and delivered to the Rights Agent a supplemental agreement so providing
and further providing that as soon as practicable after the date of any Common
Share Event described above in this Section 13 such issuer will (A) 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, and
cause such registration statement to (I) become effective as soon as practicable
after such filing and (II) remain effective (with a prospectus at all times
meeting the requirements of the Act) until the Expiration Date and take such
action as may be required to ensure that any acquisition of such Common Stock
upon the exercise of the Rights complies with any applicable state security or
"blue sky" laws and (B) will deliver to holders of the Rights historical
financial statements of such issuer and each of its Affiliates which comply in
all respects with the requirements for registration on Form 10 under the
Exchange Act. Furthermore, in case the Person which is to be party to a
transaction referred to in this Section 13 has any provision in any of its
authorized securities or in its charter or by-laws or other agreement or
instrument governing its affairs, which provision would have the effect of (i)
causing such Person to issue, in connection with, or as a consequence of, the
consummation of a transaction referred to in this Section 13, shares of Common
Stock of such Person at less than the then current market price per share
thereof (as defined in Section 11(d) hereof), or to issue securities exercisable
for, or convertible into, Common Stock of such Person at less than such then
current market price (other than to holders of Rights pursuant to this Section
13) or (ii) providing for any special payment, tax or similar provisions in
connection with the issuance of Common Stock of such Person pursuant to the
provisions of this Section 13; then, in such event, the Corporation hereby
agrees with each holder of the Rights that it shall not consummate any such
transaction unless prior thereto the Corporation and such Person shall have
executed and delivered to the Rights Agent a supplemental agreement providing
that such provision in question shall have been cancelled, waived or amended or
that the authorized securities shall be redeemed so that it will have no effect
in connection with, or as a consequence of, the consummation of the proposed
transaction. The provisions of this Section 13 shall similarly apply to
successive mergers or consolidations or sales or other transfers. In the event
that a Common Share Event described in this Section 13 shall occur at any time
after the occurrence of a Common Share Event described in Section 11(a)(ii)
hereof, the Rights which have not theretofore been exercised shall thereafter
become exercisable in the manner described in this Section 13.
24
The Rights Agent may conclusively rely and be fully protected in
conclusively relying upon a certificate of the Corporation stating that the
provisions of this Section 13 have been fulfilled. Notwithstanding anything in
this Agreement to the contrary, the prior written consent of the Rights Agent
must be obtained in connection with any supplemental agreement which in any way
alters the rights or duties of the Rights Agent.
SECTION 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES.
(a) The Corporation shall not be required to issue fractions of Rights or
to distribute Right Certificates which evidence fractional Rights. In lieu of
issuing such fractional Rights, there may, at the option of the Corporation, be
paid to the registered holders of the Rights 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.
(b) The Corporation shall not be required to issue fractions of shares of
its beneficial interests upon exercise of the Rights or to distribute
certificates which evidence fractional shares (other than, in each case with
respect to Preferred Shares or Equivalent Preferred Shares, fractions which are
integral multiples of one one-hundredth of a Preferred Share or Equivalent
Preferred Share, as the case may be). In lieu of fractional shares, there may,
at the option of the Corporation, be paid to the registered holders of Rights at
the time such Rights are exercised as herein provided an amount in cash equal to
the same fraction of the current market value of a share of its beneficial
interests. For purposes of this Section 14(b), the current market value of a
share of such beneficial interests shall be the Closing Price of such shares of
beneficial interests 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 (except as provided in Section
14(b) hereof) any fractional share upon exercise of a Right.
SECTION 15. RIGHTS OF ACTION.
Excepting the rights of action given the Rights Agent under Section 18
hereof, all rights of action in respect of this Agreement are vested in the
respective registered holders of the Rights; and any registered holder of any
Rights, without the consent of the Rights Agent or of the holder of any other
Right, may, in his own behalf and for his own benefit, enforce, and may
institute and maintain any suit, action or proceeding against the Corporation to
enforce, or otherwise act in respect of, his right to exercise the Rights
evidenced by such Right Certificates (or, prior to the Distribution Date, the
associated Common Share certificates) in the manner provided in such Right
Certificate and in this Agreement, and the Corporation hereby agrees to
reimburse such registered holder for all expenses (including reasonable
attorneys' fees) incurred by such registered holder in connection therewith.
Without limiting the foregoing or any
25
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 the obligations hereunder, and shall be entitled to injunctive relief
against actual or threatened violations of the obligations hereunder 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
Corporation 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 Shares;
(b) after the Distribution Date, the Right Certificates are transferable
only on the registry books of the Rights Agent if surrendered at the office of
the Rights Agent designated for such purpose, duly endorsed or accompanied by a
proper instrument of transfer;
(c) the Corporation and the Rights Agent may deem and treat the person in
whose name a Right Certificate (or, prior to the Distribution Date, the
associated Common Share 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, prior to the Distribution Date, the
associated Common Share certificates, made by anyone other than the Corporation
or the Rights Agent) for all purposes whatsoever, and neither the Corporation
nor the Rights Agent shall be affected by any notice to the contrary; and
(d) notwithstanding anything in this Agreement to the contrary, neither the
Corporation nor the Rights Agent shall have any liability to any holder of a
Right or other Person as a result of its inability to perform any of its
obligations under this Agreement by reason of any preliminary or permanent
injunction or other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative agency or
commission, or any statute, rule, regulation or executive order promulgated or
enacted by any governmental authority prohibiting or otherwise restraining
performance of such obligation; provided, however, the Corporation must use its
best efforts to have any such order, decree or ruling lifted or otherwise
overturned.
SECTION 17. RIGHT CERTIFICATE HOLDER NOT DEEMED A SHAREHOLDER.
No holder, as such, of any Right shall be entitled to vote, receive
dividends or otherwise be deemed for any purpose the holder of any securities of
the Corporation which may 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 shareholder of the Corporation or any right to vote in the
election of directors or upon any matter submitted to shareholders at any
meeting thereof, or to give or withhold consent to any corporate action, or to
receive notice of meetings or other actions
26
affecting shareholders (except as provided in Section 24), or to receive
dividends or preemptive rights, or otherwise, until the time specified in
Section 10 hereof.
SECTION 18. CONCERNING THE RIGHTS AGENT.
The Corporation agrees to pay to the Rights Agent such compensation as
shall be agreed in writing between the Corporation and the Rights Agent 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
Corporation also agrees to indemnify the Rights Agent for, and to hold it
harmless against, any and all loss, liability, claim, damage or expense
(including taxes other than taxes based on the income of the Rights Agent)
incurred without gross 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 (including reasonable attorneys' fees and expenses) of
defending against any claim of liability for any of the foregoing.
The Rights Agent shall be fully 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 any number of one one-hundredths of a Preferred Share or for
other securities of the Corporation, instrument of assignment or transfer, power
of attorney, opinion, endorsement, affidavit, letter, notice, direction,
consent, certificate, statement, or other paper or document (whether in its
original or facsimile form) believed by it to be genuine and to be signed and
executed by the proper person or persons.
The provisions of this Section 18 shall survive the expiration of the
Rights and the termination of this Agreement.
SECTION 19. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF RIGHTS AGENT.
Any corporation into which the 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 shall be a party, or any corporation
succeeding to all or substantially all the stock transfer or shareholder
services business of the 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 hereof. In case at the time such successor Rights
Agent shall succeed to the agency created by this Agreement and 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
27
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.
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 such 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.
SECTION 20. DUTIES OF RIGHTS AGENT.
The Rights Agent undertakes only the duties and obligations expressly
imposed upon it by this Agreement and no implied duties or obligations shall be
read into this Agreement against the Rights Agent. The Rights Agent shall
perform its duties and obligations hereunder upon the following terms and
conditions:
(a) The Rights Agent may consult with legal counsel of its selection (who
may be legal counsel to the Corporation), and the advice or 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 advice or 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) be proved
or established by the Corporation 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 (an "Officers' Certificate") signed by the Chairman
of the Corporation, the President or any Vice President and by the Treasurer or
any Assistant Treasurer or the Secretary or any Assistant Secretary of the
Corporation and delivered to the Rights Agent, provided, however, that so long
as any Person is an Acquiring Person hereunder, such Officers' Certificate shall
be signed and delivered by a majority of the Directors; and such Officers'
Certificate shall be full and complete 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 Officers' Certificate.
(c) The Rights Agent shall be liable hereunder only for its own gross
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
28
countersignature on such Right Certificate) or be required to verify the same,
but all such statements and recitals are and shall be deemed to have been made
by the Corporation 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 breach by the Corporation of any covenant or
condition contained in this Agreement or in any Right Certificate; nor shall it
be responsible for any adjustment required under the provisions of Sections 11
or 13 hereof or responsible for the manner, method or amount of any such
adjustment or procedures or the ascertaining of the existence of facts that
would require any such adjustment or procedures (except with respect to the
exercise of Rights evidenced by Right Certificates after the Rights Agent's
actual receipt of an Officers' Certificate describing any such adjustment or
procedures); nor shall it by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation of any
Preferred Shares or other securities to be issued pursuant to this Agreement or
any Right Certificate or as to whether any number of one one-hundredths of a
Preferred Share, or any shares or similar units of other securities, will, when
issued, be validly authorized and issued, fully paid and nonassessable, nor
shall the Rights Agent be responsible for the legality of the terms hereof in
its capacity as an administrative agent.
(f) The Corporation agrees that it will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered all such
further 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 Corporation, the President or any Vice President or the
Secretary or any Assistant Secretary or the Treasurer or any Assistant Treasurer
of the Corporation, 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. Any application by the Rights Agent for written instructions from
the Corporation may, at the option of the Rights Agent, set forth in writing,
any action proposed to be taken or omitted by the Rights Agent with respect to
its duties or obligations under this Rights Agreement and the date on and/or
after which such action shall be taken or omitted, and the Rights Agent shall
not be liable for any action taken or omitted in accordance with a proposal
included in any such application on or after the date specified therein (which
date shall not be less than three Business Days after the date any such officer
of the Corporation actually receives such application, unless any such officer
shall have consented in writing to an earlier date) unless, prior to taking or
omitting any such action, the Rights Agent has received in response to such
application written instructions specifying the action to be taken or omitted.
(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 Corporation or
29
become pecuniarily interested in any transaction in which the Corporation may be
interested, or contract with or lend money to the Corporation or otherwise act
as fully and freely as though it were not Rights Agent under this Agreement.
Nothing herein shall preclude the Rights Agent from acting in any other capacity
for the Corporation or for any other entity.
(i) The Rights Agent may execute and exercise any of the rights or powers
hereby vested in it or perform any duty hereunder either itself or by or through
its attorneys or agents, and the Rights Agent shall not be answerable or
accountable for any act, default, neglect or misconduct of any such attorneys or
agents or for any loss to the Corporation resulting from any such act, default,
neglect or misconduct, provided reasonable care was exercised in the selection
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 certification appearing on the reverse side
thereof following the form of election to purchase has either not been completed
or indicates an affirmative response to clause 1 and/or 2 thereof, the Rights
Agent shall not take any further action with respect to such requested exercise
of transfer without first consulting with the Corporation.
(l) In addition to the foregoing, the Rights Agent shall be fully protected
and shall incur no liability for, or in respect of, any action taken or omitted
by it in connection with its administration of this Agreement if such acts or
omissions are in reliance upon (i) the proper execution of the certification
concerning beneficial ownership appended to the form of assignment and the form
of election to purchase attached hereto unless the Rights Agent shall have
actual knowledge that, as executed, such certification is in fact untrue, or
(ii) the non-execution of such certification including, without limitation, any
refusal to honor any otherwise permissible assignment or election by reason of
such non-execution.
(m) The Corporation agrees to give the Rights Agent prompt written notice
of any event or ownership which would prohibit the exercise or transfer of the
Right Certificates.
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 Corporation and to each transfer agent of the Preferred Shares and the
Common Shares by registered or certified mail. The Corporation may remove the
Rights Agent or any successor Rights Agent upon 30 days' notice in writing,
mailed to the Rights Agent, to each transfer agent of the Preferred Shares and
the Common Shares by registered or certified mail. If the Rights Agent shall
resign
30
or be removed or shall otherwise become incapable of acting, the Corporation
shall appoint a successor to the Rights Agent. If the Corporation shall fail to
make such appointment within a period of 30 days after giving notice of such
removal or after it has been notified in writing of such resignation or
incapacity by the resigning or incapacitated Rights Agent, then the Rights Agent
or the registered holder of any Right Certificate may apply, at the expense of
the Corporation, to any court of competent jurisdiction for the appointment of a
new Rights Agent. Any successor Rights Agent, whether appointed by the
Corporation or by such a court, shall be a corporation organized and doing
business under the laws of the United States, the State of New York (or of any
other State of the United States so long as such corporation is authorized to do
business as a banking institution in the state of New York), in good standing,
having a principal office in the State of New York, which is authorized under
such laws to exercise corporate trust, stock transfer or shareholder services
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. 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; and, except as the context herein otherwise requires, such
successor Rights Agent shall be deemed to be the "Rights Agent" for all purposes
of this Agreement. Not later than the effective date of any such appointment the
Corporation shall file notice thereof in writing with the predecessor Rights
Agent and each transfer agent of the Preferred Shares and the Common Shares, 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 Corporation may, at its option, issue new Right Certificates
evidencing Rights in such form as may be approved by the Directors of the
Corporation to reflect any adjustment or change in the Purchase Price per share
and the number or kind or class of shares of stock or beneficial interests or
other securities or property purchasable under the Right Certificates made in
accordance with the provisions of this Agreement.
SECTION 23. REDEMPTION AND TERMINATION.
The Directors then in office may, at any time prior to the earlier of (i)
the close of business on the tenth Business Day following the date any Person
(other than the Corporation, any Subsidiary of the Corporation, any employee
benefit plan of the Corporation or of any Subsidiary of the Corporation, any
Exempted Person or any Person or entity organized, appointed or established by
the Corporation for or pursuant to the terms of any such plan), alone or
together with its Affiliates, shall, at any time on or after the Declaration
Date, become the
31
Beneficial Owner of 10% or more of the total combined voting power of the Common
Shares then outstanding, or (ii) the Expiration Date, at their option, upon the
affirmative vote or written consent of not less than a majority of such
Directors redeem all (but not less than all) of the then outstanding Rights at a
redemption price of $.01 per Right, appropriately adjusted to reflect any share
split, share dividend, combination of Common Shares or similar transaction
occurring after the Declaration Date (such redemption price being hereinafter
referred to as the "Redemption Price"); provided, however, if the Corporation is
then restricted or prohibited from paying the Redemption Price in cash, then the
Corporation may, at its option, pay the Redemption Price by delivery of such
other consideration, including without limitation, Common Shares or units of
Common Shares and/or other securities, or other property or assets of the
Corporation, or a combination thereof, as a majority of the Directors determine
in their sole discretion to be a fair and equivalent Redemption Price, which
determination shall be final and binding. Immediately upon the taking of such
action ordering the redemption of all of the Rights, evidence of which shall
have been filed with the Rights Agent, and without any further action and
without any notice, the right to exercise the Rights so redeemed will terminate
and the only right thereafter of the holders of such Rights so redeemed shall be
to receive the Redemption Price (without the payment of any interest thereon).
Within 10 days after such action ordering the redemption of all of the Rights,
the Corporation shall give notice of such redemption to 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 Shares. Any notice which is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice. Each such notice of
redemption will state the method by which the payment of the Redemption Price
will be made. Notwithstanding anything contained in this Agreement to the
contrary, the Rights shall not be exercisable after the first occurrence of an
event described in Section 11(a)(ii) until such time as the Corporation's right
of redemption hereunder has expired.
SECTION 24. NOTICE OF PROPOSED ACTIONS.
In case the Corporation shall propose (a) to pay any dividend payable in
stock of any class to the holders of its Preferred Shares or to make any other
distribution to the holders of its Preferred Shares (other than a regular
quarterly cash dividend), or (b) to offer to the holders of its Preferred Shares
rights or warrants to subscribe for or to purchase any additional Preferred
Shares or beneficial shares of any class or any other securities, rights or
options, or (c) to effect any reclassification of the Preferred Shares (other
than a reclassification involving only the subdivision of outstanding Preferred
Shares), or (d) to effect any consolidation or merger into or with any other
Person other than a Subsidiary of the Corporation in a transaction which
complies with Section 11(p) hereof), 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 (A)
the assets (determined on the basis of the net asset value thereof as reflected
on the books of the Corporation and in accordance with generally accepted
accounting principles consistently applied) or (B) the earning power, of the
Corporation (on an individual basis) or of the Corporation and its Subsidiaries
(on a consolidated basis) to any other Person (other than the Corporation or any
of its Subsidiaries in one or more
32
transactions each of which complies with Section 11(p) hereof) or (e) to effect
the liquidation, dissolution or winding up of the Corporation, then, in each
such case, the Corporation shall give to the Rights Agent and each holder of a
Right, in accordance with Section 25, a notice of such proposed action, which
shall specify the record date for the purposes of such dividend, distribution of
rights, 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 Preferred Shares, if any such date is
to be fixed, and such notice shall be so given in the case of any action covered
by clause (a) or (b) above at least twenty days prior to the record date for
determining holders of Preferred Shares for purposes of such action, and in the
case of any such other action, at least twenty days prior to the date of the
taking of such proposed action or the date of participation therein by the
holders of Preferred Shares whichever shall be the earlier, provided, however,
no such notice shall be required pursuant to this Section 24 if any Subsidiary
of the Corporation effects a consolidation or merger with or into, or effects a
sale or other transfer of assets or earnings power to, any other Subsidiary or
the Corporation. 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 Corporation or the vote upon any such action.
In case any Common Share Event described in Section 11(a)(ii) hereof shall
occur, then, in any such case, the Corporation shall as soon as practicable
thereafter give to the Rights Agent and each holder of a Right Certificate in
accordance with Section 25 hereof, a notice of the occurrence of such Common
Share Event, which shall specify such event and the consequences of the event to
holders of Rights under Section 11(a)(ii) hereof.
Notwithstanding anything in this Agreement to the contrary, prior to the
Distribution Date a filing by the Corporation with the Securities and Exchange
Commission shall constitute sufficient notice to the holders of securities of
the Corporation, including the Rights, for purposes of this Agreement and no
other notice need be given.
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 the Corporation 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:
URSTADT XXXXXX PROPERTIES INC.
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Attention: President
33
Subject to the provisions of Sections 19 and 21 hereof, any notice or
demand authorized by this Agreement to be given or made by the Corporation 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 Corporation) as
follows:
THE BANK OF NEW YORK
000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Stock Transfer Administration
Notices or demands authorized by this Agreement to be given or made by the
Corporation or the Rights Agent to the holder of any Right Certificate shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed to such holder at the address of such holder as shown on the registry
books of the Corporation.
SECTION 26. SUPPLEMENTS AND AMENDMENTS.
Prior to the Distribution Date and subject to the penultimate sentence of
this Section 26, the Directors then in office may, upon the affirmative vote or
written consent of not less than a majority of such Directors, supplement or
amend any provision of this Agreement from time to time without the approval of
any holders of certificates representing Common Shares. From and after the
Distribution Date and subject to the penultimate sentence of this Section 26,
the Directors then in office may, upon the affirmative vote or written consent
of not less than a majority of such Directors, supplement or amend this
Agreement from time to time without the approval of any holders of Right
Certificates 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,
or (iv) to change or supplement the provisions hereunder in any manner which
such Directors may deem necessary or desirable and which shall not adversely
affect the interests of the holders of Right Certificates (other than an
Acquiring Person, an Affiliate of an Acquiring Person or a Disqualified
Transferee); provided, however, that this Agreement may not be supplemented or
amended to lengthen, pursuant to clause (iii) of this sentence, any 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. Prior
to the Distribution Date, the interests of the holders of Rights shall be deemed
coincident with the interests of the holders of Common Shares. Notwithstanding
anything contained in this Agreement to the contrary, no supplement or amendment
shall be made which decreases the Redemption Price, changes the Expiration Date,
changes the manner of calculating the Purchase Price, decreases the Purchase
Price other than pursuant to Section 11 hereof, decreases the number of one
one-hundredths of a Preferred Share for which a Right is exercisable or affects
any right vested in the Rights Agent. Upon the delivery of a certificate from an
appropriate officer of the Corporation which states that the proposed supplement
or amendment is in compliance with the terms of this Section, the Rights Agent
shall execute such supplement or amendment. The Rights Agent shall join with the
34
Corporation in the execution and delivery of any such supplement or amendment,
unless such supplement or amendment affects any of the rights, duties or
obligations of the Rights Agent hereunder, in which case the Rights Agent may,
but shall not be required to, join in such execution and delivery.
SECTION 27. SUCCESSORS.
All the covenants and provisions of this Agreement by or for the benefit of
the Corporation or the Rights Agent shall bind and inure to the benefit of their
respective successors and assigns hereunder.
SECTION 28. DETERMINATION AND ACTIONS BY THE DIRECTORS; ETC.
The Directors of the Corporation shall have the exclusive power and
authority to administer this Agreement and exercise all rights and powers
specifically granted to the Directors, or to the Corporation, or as may be
necessary or advisable in the administration of this Agreement, including,
without limitation, the right and power to (i) interpret the provisions of this
Agreement and (ii) make all determinations deemed necessary or advisable for the
administration of this Agreement (including a determination to redeem or not
redeem the Rights or to amend the Agreement). All such actions, calculations,
interpretations and determinations (including, for purposes of clause (y) below,
all omissions with respect to the foregoing) which are done or made by the
Directors in good faith shall (x) be final, conclusive and binding on the
Corporation, the Rights Agent, the holders of the Rights and all other parties
and (y) not subject any Director to any liability to the holders of the Rights.
SECTION 29. BENEFITS OF THIS AGREEMENT.
Nothing in this Agreement shall be construed to give to any Person other
than the Corporation, the Rights Agent and the registered holders of the Right
Certificates (and, prior to the Distribution Date, the associated Common Shares)
any legal or equitable right, remedy or claim under this Agreement or the
Rights; but this Agreement shall be for the sole and exclusive benefit of the
Corporation, the Rights Agent and the registered holders of the Rights (and,
prior to the Distribution Date, the associated Common Shares).
SECTION 30. GOVERNING LAW.
This Agreement and each Right Certificate issued hereunder shall be deemed
to be a contract made under the laws of the State of New York and for all
purposes shall be governed by and construed in accordance with the laws of said
state applicable to contracts to be made and performed entirely within said
state.
35
SECTION 31. COUNTERPARTS.
This Agreement may be executed in any number of counterparts and each of
such counterparts shall for all purposes be deemed to be an original, and all
such counterparts shall together constitute but one and the same instrument.
SECTION 32. DESCRIPTIVE HEADINGS.
Descriptive headings of the several Sections of this Agreement are inserted
for convenience only and shall not control or affect the meaning or construction
of any of the provisions hereof.
SECTION 33. SEVERABILITY.
The invalidity or unenforceability of any term or provision hereof shall
not affect the validity or enforceability of any other term or provision hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, all as of the day and year first above written.
URSTADT XXXXXX PROPERTIES INC.
By: /s/ Xxxxx X. Xxxxx
-------------------
Name: Xxxxx X. Xxxxx
Title: Executive Vice President
THE BANK OF NEW YORK, as Rights Agent
By: /s/ Xxxxxxx Xxxxxxxx
---------------------
Name: Xxxxxxx Xxxxxxxx
Title: Vice President
36
EXHIBIT A
ARTICLES SUPPLEMENTARY
OF
URSTADT XXXXXX PROPERTIES INC.
Urstadt Xxxxxx Properties Inc., a Maryland corporation (the "Corporation"),
certifies as follows:
FIRST: Under the authority contained in Section 7.2 of the charter of the
Corporation, the Board of Directors of the Corporation on March 12, 1997,
classified 150,000 shares of the Preferred Stock of the Corporation as the
"Series A Participating Preferred Shares."
SECOND: A description of the Series A Participating Preferred Shares,
including the preferences, conversion and other rights, voting powers,
restrictions, limitations as to dividends, qualifications and terms and
conditions of redemption as set or changed by the Board of Directors of the
Corporation is as follows:
Section 1. Designation and Amount. The shares of such series shall be
designated as "Series A Participating Preferred Shares" (the "Series A Shares")
and the number of shares constituting such series shall be 150,000.
Section 2. Dividends and Distributions.
(A) Subject to the prior and superior rights of the holders of any
shares of any series of Preferred Shares ranking prior and superior to the
Series A Shares with respect to dividends, the holders of Series A Shares
shall be entitled to receive, when, as and if declared by the Directors out
of funds legally available for the purpose, quarterly dividends payable in
cash to holders of record on the 15th day of March, June, September and
December in each year (each such date being referred to herein as a
"Quarterly Dividend Payment Date"), commencing on the first Quarterly
Dividend Payment Date after the first issuance of a share or fraction of a
share of Series A Shares, in an amount per share (rounded to the nearest
cent) equal to the greater of (a) $.25 or (b) subject to the provision for
adjustment set forth in Section 7 hereof, 100 times the aggregate per share
amount of all cash dividends, and 100 times the aggregate per share amount
(payable in kind) of all non-cash dividends or other distributions other
than a dividend payable in Common Shares or a subdivision of the
outstanding Common Shares (by reclassification or otherwise), declared on
the common stock of the Corporation (the "Common Shares") since the
immediately preceding Quarterly Dividend Payment Date or, with respect to
the first Quarterly Dividend Payment Date, since the first issuance of any
share or fraction of a share of Series A Shares.
-A1-
(B) The Corporation shall declare a dividend or distribution on the
Series A Shares as provided in paragraph (A) of this Section 2 immediately
after it declares a dividend or distribution on the Common Shares (other
than a dividend payable in shares of or subdivision with respect to Common
Shares); provided however, that, in the event no dividend or distribution
shall have been declared on the Common Shares during the period between any
Quarterly Dividend Payment Date and the next subsequent Quarterly Dividend
Payment Date, a dividend of $.25 per share on the Series A Shares shall
nevertheless be payable on such subsequent Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative on outstanding
shares of Series A Shares from the Quarterly Dividend Payment Date next
preceding the date of issue of such shares of Series A Shares, unless the
date of issue of such shares is prior to the record date for the first
Quarterly Dividend Payment Date, in which case dividends on such shares
shall begin to accrue from the date of issue of such shares, or unless the
date of issue is a Quarterly Dividend Payment Date or is a date after the
record date for the determination of holders of shares of Series A Shares
entitled to receive a quarterly dividend and before such Quarterly Dividend
Payment Date, in either of which events such dividends shall begin to
accrue and be cumulative from such Quarterly Dividend Payment Date. Accrued
but unpaid dividends shall not bear interest. Dividends paid on the shares
of Series A Shares in an amount less than the total amount of all such
dividends at the time accrued and payable on such shares shall be allocated
pro rata on a share-by-share basis among all such shares at the time
outstanding. The Directors may fix a record date for the determination of
holders of shares of Series A Shares entitled to receive payment of a
dividend or distribution declared thereon, which record date shall be no
more than 60 days prior to the date fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of Series A Shares shall
have the following voting rights:
(A) Subject to the provision for adjustment set forth in Section 7
hereof, each share of Series A Shares shall entitle the holder thereof to
100 votes on all matters submitted to a vote of the stockholders of the
Corporation.
(B) Except as otherwise provided herein, in the charter of the
Corporation (the "Charter") or bylaws, the holders of shares of Series A
Shares and the holders of shares of Common Shares shall vote together as
one class on all matters submitted to a vote of stockholders of the
Corporation.
(C) (i) If at the time of any annual meeting of stockholders for the
election of Directors a default in preferred dividends (as hereinafter
defined) shall exist, the holders of shares of Preferred Shares voting
separately as a class without regard to series (with each share of
Preferred Shares being entitled to that number of votes to which it is
entitled on matters submitted to stockholders generally, or, if it is not
entitled to vote with respect to such matters, to one vote), shall have the
right to elect two members of
-A2-
the Directors of the Corporation. The holders of Common Shares shall not be
entitled to vote in the election of the two Directors so to be elected by
the holders of shares of Preferred Shares. Any Director elected by the
holders of shares of Preferred Shares, voting as a class as aforesaid,
shall continue to serve as such Director for the full term for which he
shall have been elected notwithstanding that prior to the end of such term
a default in preferred dividends shall cease to exist. If, prior to the end
of the term of any Director elected by the holders of the Preferred Shares,
voting as a class as aforesaid, a vacancy in the office of such Director
shall occur by reason of death, resignation, removal or disability, or for
any other cause, such vacancy shall be filled for the unexpired term in the
manner provided in the Charter, provided that, if the Charter provides that
such vacancy shall be filled by election by the stockholders at a meeting
thereof, the right to fill such vacancy shall be vested in the holders of
Preferred Shares, voting as a class as aforesaid, unless in any such case,
no default in preferred dividends shall exist at the time of such election.
(ii) For the purposes of paragraph (C)(i) of this Section 3, a
default in preferred dividends shall be deemed to have occurred
whenever the amount of dividends in arrears upon any series of
Preferred Shares shall be equivalent to six full quarterly dividends
or more and, having so occurred, such default in preferred dividends
shall be deemed to exist thereafter until all accrued dividends on all
shares of Preferred Shares then outstanding shall have been paid to
the end of the last preceding quarterly dividend period. Nothing
herein contained shall be deemed to prevent an amendment of the
Charter or the bylaws, in the manner therein provided, which shall
increase the number of Directors so as to provide as additional places
on the Board of Directors either or both the director positions to be
filled by the two Directors so to be elected by the holders of the
Preferred Shares or to prevent any other change in the number of
directors of the Corporation.
(D) Except as set forth herein, holders of Series A Shares shall have
no special voting rights and their consent shall not be required (except to
the extent they are entitled to vote with holders of Common Shares as set
forth herein) for taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or distributions
payable on the Series A Shares as provided in Section 2 are in arrears,
thereafter and until all accrued and unpaid dividends and distributions,
whether or not declared, on shares of Series A Shares outstanding shall
have been paid in full, the Corporation shall not
(i) declare or pay dividends on, make any other distribution on,
or redeem or purchase or otherwise acquire for consideration any
shares of capital
-A3-
stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Shares;
(ii) declare or pay dividends on or make any other distributions
of any shares of capital stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the
Series A Shares, except dividends paid ratably on the Series A Shares
and all such parity shares on which dividends are payable or in
arrears in proportion to the total amounts to which the holders of all
such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for consideration
any shares of capital stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the
Series A Shares, provided that the Corporation may at any time redeem,
purchase or otherwise acquire such parity shares in exchange for any
shares of capital stock of the Corporation ranking junior (either as
to dividends or upon dissolution, liquidation or winding up) to the
Series A Shares; or
(iv) purchase or otherwise acquire for consideration any shares
of Series A Shares, or any shares of capital stock ranking on a parity
with the Series A Shares, except in accordance with a purchase offer
made in writing or by publication (as determined by the Directors) to
all holders of such shares upon such terms as the Directors, after
consideration of the respective annual dividend rates and other
relative rights and preferences of the respective series and classes,
shall determine in good faith will result in fair and equitable
treatment among the respective series or classes.
(B) The Corporation shall not permit any subsidiary of the Corporation
to purchase or otherwise acquire for consideration any shares of capital
stock of the Corporation unless the Corporation could, under paragraph (A)
of this Section 4, purchase or otherwise acquire such shares at such time
and in such manner.
Section 5. Liquidation, Dissolution or Winding Up.
(A) Upon any liquidation (voluntary or otherwise), dissolution or
winding up of the Corporation, no distribution shall be made to the holders
of shares of capital stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Shares unless,
prior thereto, the holders of shares of Series A Shares shall have received
$100 per share plus an amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the date of such payment
(the "Series A Liquidation Preference"). Following the payment of the full
amount of the Series A Liquidation Preference, no additional distributions
shall be made to the holders of shares of Series A Shares unless, prior
thereto, the holders of shares of Common Stock (which term shall include,
for the purposes only of this Section 5, any series of the
-A4-
Corporation's Preferred Shares ranking on a parity with the Common Shares
upon liquidation, dissolution or winding up) shall have received an amount
per share (the "Common Adjustment") equal to the quotient obtained by
dividing (i) the Series A Liquidation Preference by (ii) 100 (as
appropriately adjusted as set forth in Section 7 hereof to reflect such
events as share splits, share dividends and recapitalizations with respect
to the Common Shares; such number in clause (ii), the "Adjustment Number").
In the event, however, that there are not sufficient assets available to
permit payment in full of the Common Adjustment, then such remaining assets
shall be distributed ratably to the holders of Common Shares. Following the
payment of the full amount of the Series A Liquidation Preference and the
Common Adjustment in respect of all outstanding shares of Series A Shares
and Common Shares, respectively, holders of Series A Shares and holders of
shares of Common Shares shall receive their ratable and proportionate share
of the remaining assets to be distributed in the ratio of the Adjustment
Number to one (1) with respect to such Series A Shares and Common Stock, on
a per share basis, respectively.
(B) In the event, however, that there are not sufficient assets
available to permit payment in full of the Series A Liquidation Preference
and the liquidation preferences of all other series of Preferred Shares, if
any, which rank on a parity with the Series A Shares, then such remaining
assets shall be distributed ratably to the holders of such parity shares in
proportion to their respective liquidation preferences.
Section 6. Consolidation, Merger, etc. In case the Corporation shall enter
into any consolidation, merger, combination or other transaction in which the
Common Shares are exchanged for or changed into other stock or securities, cash
and/or any other property, then in any such case the Series A Shares shall at
the same time be similarly exchanged or changed in an amount per share (subject
to the provision for adjustment set forth in Section 7 hereof) equal to 100
times the aggregate amount of stock, securities, cash and/or any other property
(payable in kind), as the case may be, into which or for which each Common Share
is changed or exchanged.
Section 7. Certain Adjustments. In the event the Corporation shall at any
time declare or pay any dividend on Common Shares payable in Common Shares, or
effect a subdivision or combination or consolidation of the outstanding Common
Shares (by reclassification or otherwise than by payment of a dividend in Common
Shares) into a greater or lesser number of shares of Common Shares, then, in
each such case, the amounts set forth in Sections 2(A), 3(A), 5(A) and 6 hereof
with respect to the multiple of (i) cash and non-cash dividends, (ii) votes,
(iii) the Series A Liquidation Preference and (iv) an aggregate amount of stock,
securities, cash and/or other property referred to in Section 6 hereof, shall be
adjusted by multiplying such amount by a fraction the numerator of which is the
number of Common Shares outstanding immediately after such event and the
denominator of which is the number of Common Shares that were outstanding
immediately prior to such event.
-A5-
Section 8. Ranking. The Series A Shares shall rank pari passu with (or if
determined by the Directors in any vote establishing any other series of
Preferred Shares, either senior or preferred to or junior and subordinate to as
the case may be) each other series of Preferred Shares of the Corporation with
respect to dividends and/or preference upon liquidation, dissolution or winding
up.
Section 9. Redemption. Series A Shares may be redeemed by the Corporation
at such times and on such terms as may be agreed to between the Corporation and
the redeeming stockholder, subject to any limitations which may be imposed by
law or the Charter.
Section 10. Amendment. The Charter shall not be amended in any manner which
would materially alter or change the powers, preferences or special rights of
the Series A Shares so as to affect them adversely without the affirmative vote
of the holders of two-thirds or more of the outstanding shares of Series A
Shares, if any, voting together as a single class.
Section 11. Fractional Share. Series A Shares may be issued by fractions of
a share which shall entitle the holder, in proportion to such holder's
fractional shares, to exercise voting rights, receive dividends, participate in
distributions and to have the benefit of all other rights of holders of Series A
Shares.
IN WITNESS WHEREOF, the Corporation has caused these Articles Supplementary
to be signed in its name and on its behalf on this ___th day of _____________,
1997, by its President who acknowledges that these Articles Supplementary are
the act of the Corporation and that to the best of his knowledge, information
and belief and under penalties for perjury, all matters and facts contained in
these Articles Supplementary are true in all material respects.
ATTEST: URSTADT XXXXXX PROPERTIES INC.
By: (SEAL)
-------------------------- ------------------------
Xxxxx X. Xxxxx Willing X. Xxxxxx
Secretary President
-A6-
EXHIBIT B
FORM OF RIGHT CERTIFICATE
Certificate No. R- _________ Rights
NOT EXERCISABLE AFTER NOVEMBER 12, 2008 OR EARLIER UNDER CERTAIN
CIRCUMSTANCES AS SET FORTH IN THE RIGHTS AGREEMENT OR IF NOTICE
OF REDEMPTION IS GIVEN. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT
THE OPTION OF THE CORPORATION, AT $.01 PER RIGHT (PAYABLE IN CASH
OR OTHER CONSIDERATION) ON THE TERMS SET FORTH IN THE RIGHTS
AGREEMENT. [THE RIGHTS REPRESENTED BY THIS CERTIFICATE ARE OR
WERE BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME AN
ACQUIRING PERSON OR AN AFFILIATE OF AN ACQUIRING PERSON (AS EACH
SUCH TERM IS DEFINED IN THE RIGHTS AGREEMENT). ACCORDINGLY, THIS
RIGHT CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY BECOME
NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF
THE RIGHTS AGREEMENT.]*
Right Certificate
URSTADT XXXXXX PROPERTIES 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 31, 1998 (the "Rights Agreement") between Urstadt Xxxxxx
Properties Inc., a Maryland corporation (the "Corporation"), and The Bank of New
York (the "Rights Agent"), to purchase from the Corporation at any time after
the Distribution Date (as such term is defined in the Rights Agreement) and
prior to 5:00 P.M. (New York City time) on November 12, 2008 (the "Expiration
Date"), except as hereinafter provided, at the office of the Rights Agent,
designated for such purpose, one one-hundredth of a fully paid nonassessable
share of the Series A Participating Preferred Shares, par value $.01 per share
("Preferred Shares"), of the Corporation, at a purchase price of $65 per each
one one-hundredth share (the "Purchase Price") upon presentation and surrender
of this Right Certificate with the Form of Election to Purchase set forth on the
reverse side hereof and the certificate contained therein duly executed. The
number of Rights evidenced by this Right Certificate (and the number of
one-hundredths of a share which may be purchased upon exercise thereof) set
forth above, and the Purchase Price
----------
* The portion of the legend in brackets shall be inserted only if
applicable.
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set forth above, are the number and Purchase Price as of November 13, 1998,
based on the shares of Preferred Shares of the Corporation as constituted at
such date.
As provided in the Rights Agreement, the Purchase Price and the number of
Preferred Shares 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.
In the circumstances described in Section 11(a)(ii) of the Rights
Agreement, the securities issuable upon the exercise of the Rights evidenced
hereby shall be the Original Common Shares and/or other securities of the
Corporation. In the circumstances described in Section 13 of the Rights
Agreement, the securities issuable upon the exercise of the Rights evidenced
hereby shall be the common stock or similar equity securities of an entity other
than the Corporation.
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 Corporation and the holders of the Right Certificates. Copies
of the Rights Agreement are on file at the designated office of the Rights Agent
and may be obtained by the holder of any Rights upon written request to the
Rights Agent.
This Right Certificate, with or without other Right Certificates, upon
surrender at the office of the Rights Agent designated for such purpose, with
the Form of Election to Purchase and the certificate set forth on the reverse
side hereof duly executed, 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 Preferred Shares 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 may be redeemed by the Corporation at any time at a redemption
price of $.01 per Right, payable in cash or other consideration as set forth in
the Rights Agreement (which amount is subject to adjustment as provided in the
Rights Agreement.)
No fractional Preferred Shares (or other securities) will be issued upon
the exercise of any Right or Rights evidenced hereby (other than fractions which
are an integral multiple of one one-hundredth of a share of Preferred Shares),
but in lieu thereof a cash payment will be made, as provided in the Rights
Agreement.
No holder of this Right Certificate, as such, shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of Preferred Shares or
of any other securities of the Corporation which may at any time be issuable on
the exercise hereof, nor shall anything
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contained in the Rights Agreement or herein be construed to confer upon the
holder hereof, as such, any of the rights of a shareholder of the Corporation or
any right to vote for the election of directors or upon any matter submitted to
shareholders at any meeting thereof, or to give or withhold consent to any
actions affecting shareholders (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 an authorized signatory of the Rights
Agent.
WITNESS the facsimile signature of the proper officers of the Corporation.
Dated as of November 13, 1998.
URSTADT XXXXXX PROPERTIES INC.
By:
---------------------------
Name:
Title:
ATTEST:
[Seal]
---------------------------
Name:
Title:
Countersigned:
THE BANK OF NEW YORK, as Rights Agent
BY:
---------------------------
Name:
Authorized Signatory
Date of Countersignature:
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[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)
________________________________________________________________________________
whose social security or tax identification number is:____________, the Rights
evidenced by this Right Certificate, together with all right, title and interest
herein, and does hereby irrevocably constitute and appoint
____________________________, Attorney, to transfer the within Right Certificate
on the books of the within-named Corporation, with full power of substitution.
Dated: _______________________, _____.
______________________________
Signature
(Signatures to the foregoing Assignment 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.)
Signature Guaranteed:
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FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise the Right Certificate.)
To Urstadt Xxxxxx Properties Inc.:
The undersigned hereby irrevocably elects to exercise
___________________________ Rights represented by this Right Certificate to
purchase the Preferred Shares (or other securities) issuable upon the exercise
of such Rights and requests that certificates for such shares be issued in the
name of:
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 remaining of such Rights
shall be registered in the name of and delivered to:
Please insert social security
or other identifying number:________________
________________________________________________________________________________
(Please print name and address)
________________________________________________________________________________
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Dated:______________________, ______
______________________________
Signature
(Signatures to the foregoing
Election to Purchase and the
following certificate must
conform in all respects to
name of holder as specified on
the face of this Right
Certificate)
Signature Guaranteed:
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 of any such Acquiring Person (as each such term is defined in the
Rights Agreement); and
(2) after due inquiry and to the best knowledge of the undersigned, it (i)
[ ] did [ ] did not acquire the Rights evidenced by this Right Certificate after
the occurrence of a Common Share Event (as defined in the Rights Agreement) from
any Person who is, was or became an Acquiring Person or an Affiliate of an
Acquiring Person and (ii) is not otherwise a Disqualified Transferee (as defined
in the Rights Agreement).
Dated:______________________, _____ ______________________________
Signature
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