STOCKHOLDERS RIGHTS AGREEMENT
DATED AS OF NOVEMBER 1, 1995
BETWEEN
FIRST COMMONWEALTH, INC.
AND
FIRST CHICAGO TRUST COMPANY OF NEW YORK
AS RIGHTS AGENT
TABLE OF CONTENTS
PAGE
Section 1. Certain Definitions...............................................1
Section 2. Appointment of Rights Agent.......................................6
Section 3. Issuance of Rights Certificates...................................7
Section 4. Form of Rights Certificates.......................................9
Section 5. Countersignature and Registration................................10
Section 6. Transfer, Split Up, Combination and
Exchange of Rights Certificates;
Mutilated, Destroyed, Lost or Stolen
Rights Certificates...............................11
Section 7. Exercise of Rights; Exercise Price;
Expiration Date of Rights.........................11
Section 8. Cancellation and Destruction of Rights
Certificates......................................14
Section 9. Reservation and Availability of
Preferred Shares..................................14
Section 10. Record Date of Preferred Share Ownership........................15
Section 11. Adjustment of Exercise Price, Number
and Kind of Shares and Number of Rights...........16
Section 12. Certificate of Adjusted Exercise Price or
Number of Shares..................................23
Section 13. Consolidation, Merger or Sale or Transfer
of Assets or Earning Power........................23
Section 14. Fractional Rights and Fractional Shares.........................27
Section 15. Rights of Action................................................27
Section 16. Agreements of Holders of Rights.................................28
Section 17. Rights Certificate Holder Not Deemed a
Stockholder.......................................29
Section 18. Concerning the Rights Agent.....................................29
Section 19. Merger or Consolidation of the Rights
Agent.............................................29
Section 20. Duties of the Rights Agent......................................30
Section 21. Resignation or Removal of the Rights Agent......................32
Section 22. Issuance of New Rights Certificates.............................33
Section 23. Redemption......................................................33
Section 24. Exchange........................................................35
Section 25. Notice to Holders of Rights Certificates
of Certain Events.................................37
Section 26. Other Notices...................................................38
Section 27. Supplements and Amendments......................................38
Section 28. Successors......................................................39
Section 29. Certain Determinations and Actions by
i
the Board.........................................39
Section 30. Benefits of this Agreement......................................40
Section 31. Severability....................................................40
Section 32. Governing Law...................................................40
Section 33. Counterparts....................................................40
Section 34. Descriptive Headings............................................40
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Exhibit A - Form of Certificate of Designations of
Series A Junior Participating Preferred
Stock...................................................A-1
Exhibit B - Form of Rights Certificate..............................B-1
Exhibit C - Summary of Rights to Purchase Shares of
Series A Junior Participating Preferred
Stock...................................................C-1
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STOCKHOLDERS RIGHTS AGREEMENT
Stockholders Rights Agreement dated as of November 1, 1995
(this "Agreement") between First Commonwealth, Inc., a Delaware corporation (the
"Company"), and First Chicago Trust Company of New York (the "Rights Agent").
W I T N E S S E T H:
WHEREAS, the Board of Directors of the Company desires to
provide all stockholders of the Company with the opportunity to benefit from the
long-term prospects and value of the Company and to ensure that all such
stockholders receive fair and equal treatment in the event of any proposed
takeover of the Company; and
WHEREAS, on October 20, 1995, the Board of Directors of the
Company authorized and declared a dividend of one preferred stock purchase right
(individually a "Right" and collectively the "Rights") for each share of Common
Stock (as hereinafter defined) of the Company outstanding at the Close of
Business on the effective date of the Company's initial public offering
registration statement, file no. 33-97426 (the "Record Date"), each Right
representing the right to purchase one one-hundredth of a Preferred Share (as
hereinafter defined) upon the terms and subject to the conditions herein after
set forth, and contemplates that one Right will be issued with respect to each
share of Common Stock which shall become outstanding after the Record Date and
prior to the earlier of the Redemption Date and the Final Expiration Date (as
such terms are hereinafter defined), including any shares of Common Stock issued
by reason of the exercise of any option, warrant, right (other than the Rights)
or conversion or exchange privilege contained in any option, warrant, right
(other than the Rights) or convertible or exchangeable security issued by the
Company prior to the Distribution Date, unless the Board (as hereinafter
defined) shall expressly provide to the contrary at the time of issuance of any
such option, warrant, right or convertible or exchangeable security.
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein set forth, the parties hereto agree as follows:
SECTION 1. CERTAIN DEFINITIONS. For all purposes of
this Agreement, unless the context otherwise requires, the
following terms shall have the respective meanings set forth below:
(a) "ACQUIRING PERSON" shall mean any Person who or which,
together with all Affiliates and Associates of such Person, shall be the
Beneficial Owner of 15% or more of the shares of Common Stock of the Company
then outstanding, but shall not include (i) the Company, (ii) any Subsidiary of
the Company, (iii) any employee benefit plan or other compensation program or
arrangement of the Company or of any such
Subsidiary or (iv) any Person holding such shares of Common Stock for or
pursuant to the terms of any such plan, program or arrangement (the Persons
specified in clauses (i) through (iv) being hereinafter collectively called
"Exempt Persons"). Notwithstanding the preceding sentence, no Person shall
become an "Acquiring Person" as the result of an acquisition by the Company of
shares of its Common Stock which, by reason of reducing the number of its then
outstanding shares of Common Stock, increases the percentage of its then
outstanding shares of Common Stock Beneficially Owned by such Person to 15% or
more; PROVIDED, HOWEVER, that if such Person shall, after such purchase by the
Company, become the Beneficial Owner of any additional shares of Common Stock of
the Company, then such Person shall be deemed to be an "Acquiring Person."
Notwithstanding the foregoing, if the Board of Directors of the Company
determines in good faith that a Person who would otherwise be an "Acquiring
Person," as defined pursuant to the foregoing provisions of this paragraph (a),
has become such inadvertently, and such Person divests as promptly as
practicable a sufficient number of shares of Common Stock so that such Person
would no longer be an "Acquiring Person," as defined pursuant to the foregoing
provisions of this paragraph (a), then such Person shall not be deemed to be an
"Acquiring Person" for any purpose of this Agreement.
(b) "AFFILIATE" and "ASSOCIATE" shall have the respective
meanings ascribed to such terms in Rule 12b-2, as in effect on the date of this
Agreement, under the Exchange Act; PROVIDED, HOWEVER, that no director or
officer of the Company shall be deemed an Affiliate or Associate of any other
director or officer of the Company solely as a result of his or her being a
director or officer of the Company.
(c) "BENEFICIAL OWNER" (including the terms "BENEFICIALLY OWN"
and "BENEFICIAL OWNERSHIP"), when used with respect to any Person, shall be
deemed to include any securities which:
(i) such Person or any of such Person's Affiliates or
Associates beneficially owns, directly or indirectly (determined as
provided in Rule 13d-3, as in effect on the date of this Agreement,
under the Exchange Act);
(ii) such Person or any of such Person's Affiliates or Associates,
directly or indirectly, has:
(A) the right to acquire (whether such right is
exercisable immediately or only after the passage of time or
upon the satisfaction of any conditions, or both) pursuant to
any written or oral agreement, arrangement or understanding
(other than customary agreements with and among underwriters
and selling group members with respect to a bona fide public
offering of securities), upon the exercise of any options,
warrants, rights (other than the Rights) or conversion or
exchange privileges or otherwise; PROVIDED, HOWEVER, that a
Person shall not be deemed the Beneficial Owner of, or to
Beneficially Own: (I) securities
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tendered pursuant to a tender or exchange offer made by or on
behalf of such Person or any of such Person's Affiliates or
Associates until such tendered securities are accepted for
purchase or exchange or (II) securities issuable upon exercise
of the Rights at any time prior to the Distribution Date; or
(B) the right to vote pursuant to any written or oral
agreement, arrangement or understanding; PROVIDED, HOWEVER,
that a Person shall not be deemed the Beneficial Owner of, or
to Beneficially Own, any security otherwise subject to this
item (B) if such agreement, arrangement or understanding to
vote (I) arises solely from a revocable proxy or consent given
to such Person or any of such Person's Affiliates or
Associates in response to a public proxy or consent
solicitation made pursuant to, and in accordance with, the
applicable rules and regulations under the Exchange Act and
(II) is not also then reportable by such Person on Schedule
13D (or any comparable or successor report then in effect)
under the Exchange Act; or
(C) the right to dispose of pursuant to any written
or oral agreement, arrangement or understanding (other than
customary agreements with and among underwriters and selling
group members with respect to a bona fide public offering of
securities); or
(iii) are beneficially owned, directly or indirectly, by any other
Person with which such Person or any of such Person's Affiliates or
Associates has any written or oral agreement, arrangement or
understanding (other than customary agreements with and among
underwriters and selling group members with respect to a bona fide
public offering of securities) for the purpose of acquiring, holding,
voting (except to the extent contemplated by the proviso to item (B) of
subparagraph (ii) of the first paragraph of this definition) or
disposing of any securities of the Company.
Notwithstanding the first paragraph of this definition, no
director or officer of the Company shall be deemed to be the "Beneficial Owner"
of, or to "Beneficially Own," shares of Common Stock or other securities of the
Company beneficially owned by any other director or officer of the Company
solely as a result of his or her being a director or officer of the Company.
(d) "BOARD" shall mean the Board of Directors of the Company.
(e) "BUSINESS DAY" shall mean any day other than a Saturday, a
Sunday or a day on which banking institutions in the State of Illinois are
authorized or obligated by law or executive order to close.
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(f) "CERTIFICATE OF DESIGNATIONS" shall mean the Certificate
of Designations for the Preferred Shares in substantially the form attached
hereto as Exhibit A.
(g) "CLOSE OF BUSINESS" on any given date shall mean 5:00
P.M., Chicago time, on such date or, if such date is not a Business Day, then
5:00 P.M., Chicago time, on the next succeeding Business Day.
(h) "COMMON STOCK," when used with reference to the Company,
shall mean the Common Stock, $.001 par value, of the Company. "Common Stock,"
when used with reference to any Person other than the Company, shall mean the
capital stock with the greatest voting power (or the other equity securities or
equity interests having the power to control or direct management) of such
Person or, if such Person is a Subsidiary of another Person, of the Person which
ultimately controls such first-mentioned Person and which has issued and
outstanding such capital stock, equity securities or equity interests.
(i) "DISINTERESTED DIRECTOR" shall mean (i) any member of the
Board, while such a member, who is not a Restricted Person, or a representative
or nominee of a Restricted Person, and was a member of the Board prior to the
date of this Agreement and (ii) any individual who subsequently becomes a member
of the Board and is not a Restricted Person, or a representative or nominee of a
Restricted Person, if such individual's nomination for election or election to
the Board is recommended or approved by a majority of the Disinterested
Directors then in office.
(j) "DISTRIBUTION DATE" shall have the meaning set forth in
Section 3(a).
(k) "EQUIVALENT PREFERRED SHARES" shall have the meaning set
forth in Section 11(b).
(l) "EXCHANGE ACT" shall mean the Securities Exchange Act of
1934, as in effect on the date of this Agreement.
(m) "EXCHANGE RATE" shall have the meaning set forth in
Section 24(a).
(n) "EXEMPT PERSONS" shall have the meaning set forth in the
definition of "Acquiring Person."
(o) "EXERCISE PRICE" shall have the meaning set forth in
Section 7(b).
(p) "FAIR MARKET VALUE" shall have the meaning and be
determined as set forth in Section 11(d).
(q) "FINAL EXPIRATION DATE" shall have the meaning set forth
in Section 7(a).
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(r) "INTERESTED STOCKHOLDER" shall mean any Restricted Person
or any Affiliate or Associate of any other Person in which such Restricted
Person has an interest, or any Person acting, directly or indirectly, on behalf
of or in concert with any such Restricted Person.
(s) "NASDAQ" shall have the meaning set forth in Section 9(c).
(t) "PERMITTED OFFER" shall mean any tender or exchange offer
for all of the outstanding shares of Common Stock of the Company at a price and
on terms determined, prior to the purchase of shares under such tender or
exchange offer, by at least a majority of the members of the Board who are
Disinterested Directors and who are not officers of the Company to be
appropriate (taking into account all factors which such Disinterested Directors
deem relevant, including, without limitation, prices reasonably obtainable if
the Company or its assets were sold on an orderly basis designed to realize
maximum value) and otherwise in the best interests of the Company and its
stockholders (other than the Person or any Affiliate or Associate thereof on
whose behalf or for whose benefit such tender or exchange offer is being made).
(u) "PERSON" shall mean any individual, firm, corporation,
partnership or other entity, and shall include any successor (by merger or
otherwise) of any of the foregoing.
(v) "PREFERRED SHARES" shall mean the Series A Junior
Participating Preferred Stock of the Preferred Stock, which series shall have
the powers, preferences and other rights set forth in the Certificate of
Designations.
(w) "PREFERRED STOCK," when used with reference to the
Company, shall mean the Preferred Stock, $.001 par value, of the Company.
(x) "PRINCIPAL PARTY" shall have the meaning set forth in
Section 13(e).
(y) "RECORD DATE" shall have the meaning set forth in the
second recital clause of this Agreement.
(z) "REDEMPTION DATE" shall have the meaning set forth in
Section 7(a).
(aa) "REDEMPTION PRICE" shall have the meaning set forth
in Section 23(a).
(bb) "RESTRICTED PERSON" shall mean an Acquiring Person
or any Affiliate or Associate of an Acquiring Person.
(cc) "RIGHTS" shall have the meaning set forth in the
second recital clause of this Agreement.
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(dd) "RIGHTS CERTIFICATES" shall mean the certificates
evidencing the Rights after the Distribution Date.
(ee) "SECTION 11(A)(II) EVENT" shall mean any event
described in Section 11(a)(ii).
(ff) "SECTION 13 EVENT" shall mean any transaction
described in Section 13(a).
(gg) "SECURITIES ACT" shall mean the Securities Act of
1933, as amended from time to time.
(hh) "SECURITY" shall have the meaning set forth in
Section 11(d).
(ii) "SHARE ACQUISITION DATE" shall mean the first date on
which there shall be a public announcement (which shall include, without
limitation, any press release or publicly available filing with the Securities
and Exchange Commission or any other federal or state governmental authority or
agency) by the Company or an Acquiring Person that an Acquiring Person has
become such.
(jj) "STOCK" shall have the meaning set forth in Section
11(d).
(kk) "SUBSIDIARY" of any Person shall mean any corporation or
other entity of which a majority of the voting power or the other equity
securities or equity interests having the power to control or direct management)
is owned, directly or indirectly, by such Person.
(ll) "SUMMARY OF RIGHTS" shall mean the Summary of Rights to
Purchase shares of Series A Junior Participating Preferred Stock in
substantially the form attached hereto as Exhibit C.
(mm) "TRADING DAY" shall have the meaning set forth in
Section 11(d)(i).
(nn) "TRIGGERING EVENT" shall mean any Section 11(a)(ii)
Event or any Section 13 Event.
SECTION 2. APPOINTMENT OF RIGHTS AGENT. The Company
hereby appoints the Rights Agent to act as agent for the Company and the holders
of the Rights (which holders, as provided in Section 3, shall, prior to the
Distribution Date, also be the holders of the Common Stock of the Company) in
accordance with the terms and conditions of this Agreement. The Rights Agent
hereby accepts such appointment. The Company may from time to time appoint such
Co-Rights Agents as it may deem necessary or desirable. In the event the Company
appoints one or more Co-Rights Agents, the respective obligations and duties of
the Rights Agent and of any Co-Rights Agent shall be as the Company shall
specify in writing. The Rights Agent shall have no duty to supervise, and shall
not be liable for the acts or omissions of, any Co-Rights
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Agent.
SECTION 3. ISSUANCE OF RIGHTS CERTIFICATES.
(a) Until the earliest of (i) the Close of Business on the
10th Business Day after the Share Acquisition Date (or, if the Share Acquisition
Date shall have occurred prior to the Record Date, the Close of Business on the
10th Business Day after the Record Date) or (ii) the Close of Business on the
10th Business Day (or, anything in Section 27 to the contrary notwithstanding,
such other Business Day as may be determined by action of the Board prior to the
occurrence of any Section 11(a)(ii) Event) after the date of the commencement by
any Person (other than an Exempt Person) of, or the first public announcement of
the intention of any Person (other than an Exempt Person) to commence, a tender
or exchange offer if, upon the consummation thereof, such Person would be the
Beneficial Owner of 15% or more of the shares of Common Stock of the Company
then outstanding (the earliest of the dates specified clauses (i) and (ii) being
hereinafter called the "Distribution Date"), the Rights shall be evidenced and
be transferable only as provided in Section 3(b). As soon as practicable after
the Distribution Date or, in the case of any shares of Common Stock of the
Company which are issued or otherwise become outstanding after the Distribution
Date and prior to the earlier of the Redemption Date and the Final Expiration
Date, including any shares of Common Stock issued by reason of the exercise of
any option, warrant, right (other than the Rights) or conversion or exchange
privilege contained in any option, warrant, right (other than the Rights) or
convertible or exchangeable security issued by the Company prior to the
Distribution Date, unless the Board shall have expressly provided to the
contrary at the time of issuance of any such option, warrant, right or
convertible or exchangeable security, simultaneously with the issuance of stock
certificates for such shares of Common Stock, the Company shall prepare and
execute, the Rights Agent shall countersign and the Company shall deliver or
cause to be delivered (or the Rights Agent shall, if requested, deliver), by
first-class mail, postage prepaid, to each record holder of shares of Common
Stock of the Company as of the Close of Business on the Distribution Date or, in
the case of shares of Common Stock issued or otherwise becoming outstanding
after the Distribution Date (unless otherwise provided with respect thereto as
aforesaid), to each record holder of the shares of Common Stock so being issued
or becoming outstanding at the time of such occurrence, at its last address
shown on the registry books of the transfer agent for the Common Stock of the
Company, one or more Rights Certificates evidencing one Right for each share of
Common Stock of the Company so held, issued or becoming outstanding. As of and
after the Distribution Date, the Rights shall be evidenced solely by the Rights
Certificates.
(b) On the Record Date, or as soon as practicable thereafter,
the Company shall send a copy of the Summary of Rights, by first-class mail,
postage prepaid, to each record holder of shares of Common Stock of the Company
as of the Close of Business on the Record Date, at its last address shown on the
registry books of the transfer agent for the Common Stock of the Company. Until
the Distribution
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Date: no Rights Certificates shall be issued; each stock certificate for shares
of Common Stock of the Company outstanding as of the Record Date, until the
earliest of the Distribution Date, the Redemption Date and the Final Expiration
Date, shall be deemed also to constitute a certificate for the Rights associated
with the shares represented thereby, together with a copy of the Summary of
Rights attached thereto; and the registered holder of such shares shall also be
the registered holder of the associated Rights. Until the earliest of the
Distribution Date, the Redemption Date and the Final Expiration Date, the
surrender for transfer of any such stock certificate, with or without a copy of
the Summary of Rights attached thereto, shall also constitute the transfer of
the Rights associated with the shares of Common Stock represented thereby.
(c) Any stock certificate for shares of Common Stock of the
Company which shall be delivered by or on behalf of the Company (including,
without limitation, stock certificates for shares of Common Stock which are
reacquired by the Company and then transferred) after the Record Date and prior
to the earliest of the Distribution Date, the Redemption Date and the Final
Expiration Date shall have impressed, printed or written thereon, or otherwise
affixed thereto, the following legend:
"This certificate also evidences and entitles the holder
hereof to certain Rights as set forth in the Stockholders Rights
Agreement dated as of November 1, 1995 (the "Rights Agreement") between
First Commonwealth, Inc. (the "Company") and First Chicago Trust
Company of New York, as Rights Agent, the terms, provisions and
conditions of which are incorporated herein by reference and made a
part hereof. The Rights Agreement is on file at the principal office of
the Company and the principal office of such Rights Agent, and the
Company will mail to the holder of this certificate a copy without
charge after receipt of a written request therefor. 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 Rights (i) may be redeemed at a redemption
price (subject to adjustment) $.01 per Right or (ii) under certain
circumstances, may be exchanged, in whole or in part, for shares of
Common Stock of the Company at an exchange rate (subject to
adjustment) of one share of Common Stock per Right, all as set forth
in the Rights Agreement. Under certain circumstances, as set forth in
the Rights Agreement, Rights Beneficially Owned by a Restricted Person
(as such terms are defined in the Rights Agreement), or by specified
transferees from a Restricted Person, shall be or become void."
Each stock certificate containing the foregoing legend, until
the earliest of the Distribution Date, the Redemption Date and the Final
Expiration Date, shall be deemed also to constitute a certificate for the Rights
associated with the shares represented thereby, and the registered holder of
such shares shall also be the registered holder of the associated Rights. Until
the earliest of the Distribution Date, the Redemption Date and the Final
Expiration Date, the surrender for transfer of any
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such stock certificate shall also constitute the transfer of the Rights
associated with the shares of Common Stock represented thereby. The omission of
the foregoing legend shall not in any manner whatsoever affect the application
or interpretation of Section 7(d).
(d) In the event that the Company shall reacquire any shares
of its Common Stock after the Record Date and prior to the Distribution Date,
the Rights associated with such shares shall be deemed cancelled and retired,
the Company not being entitled to exercise any Rights associated with shares of
its Common Stock which are no longer outstanding.
SECTION 4. FORM OF RIGHTS CERTIFICATES.
(a) The Rights Certificates (including the Form of Election to
Purchase and Certification of Status and the Form of Assignment and
Certification of Status to be set forth on the reverse side thereof) shall be in
substantially the form attached hereto as Exhibit B and may have such marks of
identification or designation and such legends, summaries or endorsements set
forth thereon as the Company may deem appropriate and are not inconsistent with
the provisions of this Agreement, or as may be required to conform to customary
practice or to comply with any applicable law or 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. Subject to Sections 11 and 22, the
Rights Certificates, whenever distributed, shall be dated as of the Record Date
(or, in the case of Rights with respect to shares of Common Stock issued or
becoming outstanding after the Record Date, the same date as the stock
certificate evidencing such shares), shall (if the Company shall so require)
indicate the date of countersignature by the Rights Agent and shall entitle the
holders thereof to purchase such number of one one-hundredths of a Preferred
Share at the Exercise Price as shall be set forth therein, but the number of
such one one-hundredths of a Preferred Share and the Exercise Price shall be
subject to adjustment as provided herein.
(b) Any Rights Certificate issued pursuant to Section 3(a) or
Section 22 that represents Rights Beneficially Owned by: (i) a Restricted
Person, (ii) a transferee from a Restricted Person who becomes a transferee
after the Acquiring Person becomes such or (iii) a transferee from a Restricted
Person who becomes a transferee prior to or concurrently with the Acquiring
Person becoming such and receives such Rights pursuant to either (A) a transfer
(whether or not for consideration) from such Acquiring Person (or any Affiliate
or Associate thereof) to holders of equity interests in such Acquiring Person
(or any such Affiliate or Associate) or to any Person with whom such Acquiring
Person (or any such Affiliate or Associate) has any continuing written or oral
agreement, arrangement or understanding regarding the transferred Rights or (B)
a transfer which the Board has determined is part of a plan, arrangement or
understanding which has as a primary purpose or effect the avoidance of Section
7(d), and any Rights Certificate issued pursuant to Section 6, 11 or 22 upon the
transfer, exchange, replacement or adjustment of any other Rights Certificate
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referred to in this sentence, shall have deleted therefrom the second sentence
of the legend on the Form of Rights Certificate attached hereto as Exhibit B
and, in lieu thereof, shall contain the following two sentences:
"The Rights represented by this Rights Certificate are or were
Beneficially Owned by a Restricted Person (as such term is defined in
such Agreement). This Rights Certificate and the Rights represented
hereby shall be or become void under the circumstances specified in
Section 7(d) of such Agreement."
The Company shall give prompt written notice to the Rights
Agent after becoming aware of the existence and identity of any Restricted
Person. The failure to insert the foregoing sentences on any such Rights
Certificate or any defect therein shall not in any manner whatsoever affect the
application or interpretation of Section 7(d). The Company shall specify to the
Rights Agent in writing which Rights Certificates are to be so legended.
SECTION 5. COUNTERSIGNATURE AND REGISTRATION.
(a) The Rights Certificates shall be executed on behalf of the
Company by its Chairman of the Board, its President, any of its Vice Presidents
or its Treasurer, either manually or by facsimile signature, and shall have
affixed thereto the Company's seal or a facsimile thereof attested by its
Secretary or any of its Assistant Secretaries, either manually or by facsimile
signature. The Rights Certificates shall be manually countersigned by an
authorized signatory of the Rights Agent and shall not be valid or obligatory
for any purpose unless so countersigned. In case any officer of the Company who
shall have executed any Rights Certificate or who shall have attested the
Company's seal thereon shall cease to be such officer of the Company before such
Rights Certificate shall have been countersigned by an authorized signatory of
the Rights Agent and issued and delivered by or on behalf of the Company, such
Rights Certificate, nevertheless, may be countersigned by the Rights Agent and
issued and delivered by or on behalf of the Company with the same force and
effect as though the individual who executed such Rights Certificate or who
attested the Company's seal thereon had not ceased to be such officer; and any
Rights Certificate may be executed on behalf of the Company and the Company's
seal may be attested by any individual who, at the actual date of such execution
or attestation, shall be a proper officer of the Company, although at the date
of execution of this Rights Agreement such person was not such an officer.
(b) After the Distribution Date, the Rights Agent shall keep
or cause to be kept, at its principal office, books for registration and
transfer of the Rights Certificates issued hereunder. Such books shall show the
names and addresses of the respective holders of the Rights Certificates, the
number of Rights evidenced on its face by each Rights Certificate, the date of
each Rights Certificate and (if required by the Company) the date of
countersignature by the Rights Agent.
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SECTION 6. TRANSFER, SPLIT UP, COMBINATION AND EXCHANGE
OF RIGHTS CERTIFICATES; MUTILATED, DESTROYED, LOST OR STOLEN RIGHTS
CERTIFICATES.
(a) Subject to Sections 4(b), 7(d) and 14, at any time after
the Close of Business on the Distribution Date and prior to the Close of
Business on the earlier of the Redemption Date and the Final Expiration Date,
any Rights Certificate (other than any Rights Certificate which shall have been
exchanged pursuant to Section 24) may be transferred, split up, combined or
exchanged for one or more other Rights Certificates, entitling the registered
holder to purchase the same number of one one-hundredths of a Preferred Share
(or after a Triggering Event, the securities, cash and other property
purchasable in lieu thereof) as the Rights Certificate or Rights Certificates
surrendered entitled such registered holder to purchase. Any registered holder
desiring to transfer, split up, combine or exchange one or more Rights
Certificates shall make such request in a writing delivered to the Rights Agent,
and shall surrender the Rights Certificates to be transferred, split up,
combined or exchanged, with the Form of Assignment and Certification of Status
on the reverse side thereof duly executed, together with such signature
guarantees and other documentation as the Rights Agent may reasonably request,
at the principal office of the Rights Agent. Thereupon the Company shall prepare
and execute, the Rights Agent shall countersign and the Company shall deliver or
cause to be delivered (or the Rights Agent shall, if requested, deliver) to the
person entitled thereto one or more Rights Certificates as so requested. The
Company may require payment of a sum sufficient to cover any tax or governmental
charge that may be imposed in connection with any transfer, split up,
combination or exchange of Rights Certificates and reimbursement to the Company
and the Rights Agent of all reasonable expenses incidental thereto.
(b) Upon receipt by the Company and the Rights Agent of
evidence reasonably satisfactory to them of the loss, theft, destruction or
mutilation of a Rights Certificate, and, in the case of loss, theft or
destruction, of indemnity or security reasonably satisfactory to them or, in the
case of mutilation, upon surrender to the Rights Agent of the mutilated Rights
Certificate, and, at the Company's request, reimbursement to the Company and the
Rights Agent of all reasonable expenses incidental thereto, the Company shall
prepare and execute, the Rights Agent shall countersign and the Company shall
deliver or cause to be delivered (or the Rights Agent shall, if requested,
deliver) to the registered holder thereof a new Rights Certificate of like tenor
in lieu of the Rights Certificate so lost, stolen, destroyed or mutilated.
SECTION 7. EXERCISE OF RIGHTS; EXERCISE PRICE;
EXPIRATION DATE OF RIGHTS.
(a) Subject to Section 7(d), the registered holder of any
Rights Certificate may exercise the Rights evidenced thereby (except as
otherwise provided herein), in whole or in part, at any time after the
Distribution Date and prior to the earliest of (i) the Close of Business on the
tenth anniversary of the Record Date (the "Final Expiration Date"), (ii) the
time at which the Rights are redeemed as provided in
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Section 23 (the "RedemptionDate") and (iii) the time at which such Rights are
exchanged as provided in Section 24, upon surrender of such Rights Certificate,
with the Form of Election to Purchase and Certification of Status on the reverse
side thereof duly executed, together with such signature guarantees and other
documentation as the Rights Agent may reasonably request, to the Rights Agent at
its principal office, accompanied by payment (as provided in subsection (c) of
this Section 7) of the Exercise Price for each one one-hundredth of a Preferred
Share (or after a Triggering Event, the securities, cash and other property
purchasable in lieu thereof) as to which the surrendered Rights are then being
exercised.
(b) The price (the "Exercise Price") for each one
one-hundredth of a Preferred Share purchased upon exercise of the Rights shall
initially be $40.00, shall be subject to adjustment from time to time as
provided in Sections 11 and 13 and shall be payable in lawful money of the
United States of America in accordance with subsection (c) of this Section 7.
(c) Upon receipt of a Rights Certificate representing then
exercisable Rights, with the Form of Election to Purchase and Certification of
Status on the reverse side thereof duly executed, together with such signature
guarantees and other documentation as the Rights Agent may reasonably request,
accompanied by payment of the Exercise Price for the number of one
one-hundredths of a Preferred Share (or after a Triggering Event, the
securities, cash and other property purchasable in lieu thereof) being
purchased, plus the amount of any applicable transfer tax (as determined by the
Rights Agent) required to be paid by the holder of such Rights Certificate in
accordance with Section 9, by certified or cashier's check or money order
payable to the order of the Company, the Rights Agent shall, subject to the
terms and conditions of this Agreement, thereupon promptly (i) requisition from
any transfer agent for the Preferred Shares (or, if the Rights Agent is such a
transfer agent, make available) stock certificates for the number of one
one-hundredths of a Preferred Share being purchased, the Company hereby
irrevocably authorizing any such transfer agent to comply with all such
requests, (ii) if the Company shall have elected to deposit the Preferred Shares
issuable upon exercise of the Rights with a depository agent, requisition from
the depository agent depository receipts for the number of one one-hundredths of
a Preferred Share being purchased (in which case stock certificates for the
Preferred Shares represented by such depository receipts shall be deposited by
the transfer agent for the Preferred Shares with the depository agent), the
Company hereby irrevocably authorizing any such depository agent to comply with
all such requests, (iii) after a Triggering Event, requisition or obtain from
the appropriate Person or Persons such securities, cash and other property as
may then be purchasable in lieu of Preferred Shares, the Company hereby
irrevocably authorizing all such requests, (iv) when appropriate, requisition
from the Company the amount of cash to be paid in lieu of the issuance of any
fractional share in accordance with Section 14 and (v) promptly after receipt of
such stock certificates, depository receipts, securities, cash and/or other
property, cause the same to be delivered to or upon the order of the registered
holder of such Rights Certificate, registered (when appropriate) in such name
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or names as may be designated by such registered holder.
(d) Notwithstanding anything in this Agreement to the
contrary, from and after the first occurrence of any Section 11(a)(ii) Event,
any Rights Beneficially Owned by: (i) a Restricted Person, (ii) a transferee
from a Restricted Person who becomes a transferee after the Acquiring Person
becomes such or (iii) a transferee from a Restricted Person who becomes a
transferee prior to or concurrently with the Acquiring Person becoming such and
receives such Rights pursuant to either (A) a transfer (whether or not for
consideration) from such Acquiring Person (or any Affiliate or Associate
thereof) to holders of equity interests in such Acquiring Person (or any such
Associate or Affiliate) or to any Person with whom such Acquiring Person (or any
such Associate or Affiliate) has any continuing written or oral agreement,
arrangement or understanding regarding the transferred Rights or (B) a transfer
which the Board has determined is part of a plan, arrangement or understanding
which has as a primary purpose or effect the avoidance of this Section 7(d)
shall be or become 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, from and after such first
occurrence. The Company shall use all reasonable efforts to ensure that the
provisions of this Section 7(d) and Section 4(b) are complied with, but shall
have no liability to any holder of the Rights Certificates or to any other
Person as a result of the Company's failure to make any applicable finding or
determination with respect to any Restricted Person, or any transferee
therefrom.
(e) Notwithstanding subsection (a) of this Section 7, a Right
may be exercised by the holder thereof on or after the Distribution Date and
prior to the receipt of the associated Rights Certificate by notifying the
Rights Agent in writing and furnishing to the Rights Agent such information and
evidence as to such election as the Rights Agent may reasonably request;
PROVIDED, HOWEVER, that the Rights Agent shall not be required to take any of
the actions specified in subsection (c) of this Section 7 until such holder
shall have fully satisfied the applicable requirements specified therein.
(f) Neither the Rights Agent nor the Company shall be
obligated to undertake any action with respect to any Rights or Rights
Certificate upon the purported exercise or transfer thereof unless the
registered holder thereof shall have (i) completed and signed the Certification
of Status following the Form of Election to Purchase or the Form of Assignment,
as the case may be, set forth on the reverse side of the Rights Certificate
surrendered for such exercise or transfer and (ii) provided such additional
evidence as to the identity of the Beneficial Owner (or former Beneficial Owner)
thereof or the Affiliates or Associates thereof as the Company shall reasonably
request.
(g) In case the registered holder of any Rights Certificate
shall exercise less than all of the Rights evidenced thereby, then, subject to
the provisions of Section 14, a new Rights Certificate evidencing the Rights
remaining unexercised shall be prepared and executed by the Company and
countersigned and delivered by the Rights Agent to the registered holder of such
surrendered Rights Certificate or to such registered holder's duly authorized
assigns.
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SECTION 8. CANCELLATION AND DESTRUCTION OF RIGHTS
CERTIFICATES. All Rights Certificates surrendered for the purpose of exercise,
transfer, split up, combination or exchange shall, if surrendered to the Company
or to any of its agents, be delivered to the Rights Agent for cancellation or in
cancelled form or, if surrendered to the Rights Agent, shall be cancelled by it;
and no Rights Certificates shall be issued in lieu thereof except as expressly
permitted by this Agreement. The Company shall deliver to the Rights Agent for
cancellation, and the Rights Agent shall cancel, any other Rights Certificate
purchased or reacquired by the Company otherwise than upon the exercise thereof.
The Rights Agent shall deliver all cancelled Rights Certificates to the Company
or shall, at the written request of the Company, destroy such cancelled Rights
Certificates and deliver a certificate of the destruction thereof to the
Company.
SECTION 9. RESERVATION AND AVAILABILITY OF PREFERRED
SHARES.
(a) The Company covenants and agrees that it will cause to be
reserved and kept available out of its authorized and unissued Preferred Shares,
or any authorized and issued Preferred Shares held in its treasury, the number
of Preferred Shares required to permit the exercise in full of all outstanding
Rights.
(b) The Company covenants and agrees that it will take all
such action as may be necessary to ensure that all Preferred Shares delivered
upon exercise of the Rights shall, at the time of delivery of the stock
certificates therefor in accordance with Section 7(c) (including the receipt of
payment of the Exercise Price), be duly and validly authorized and issued and
fully paid and nonassessable.
(c) The Company covenants and agrees that it will use its best
efforts to cause, from and after such time as the Rights shall become
exercisable, all Preferred Shares issued or reserved for issuance to be listed,
upon official notice of issuance, on the principal national securities exchange,
if any, on which its Common Stock is listed or, if the principal market for
Common Stock is not on any national securities exchange, to be eligible for
quotation on the National Association of Securities Dealers Automated Quotation
System ("NASDAQ") or any successor thereto or other comparable quotation system.
(d) The Company covenants and agrees that it will use its best
efforts to (i) file, as soon as practicable after the occurrence of any Section
11(a)(ii) Event for which the consideration to be delivered by the Company upon
exercise of the Rights has been determined in accordance with Section 11(a)(iv),
or as soon as required by law after the Distribution Date, as the case may be, a
registration statement on an appropriate form under the Securities Act with
respect to the securities purchasable upon exercise of the Rights, (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 which at all times meets the requirements of the Securities
Act) until the earliest of (A) the date as of which the Rights are no longer
exercisable for such securities, (B) the Redemption Date and (C) the Final
Expiration
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Date. The Company further covenants and agrees that it will take such
action as may be appropriate under, and which will ensure compliance with, the
securities or "blue sky" laws of such jurisdictions as may be necessary or
appropriate in connection with the exercisability of the Rights. The Company may
temporarily suspend, for not more than 90 days after the applicable date
specified in the first sentence of this subsection (d), the exercisability of
the Rights in order to prepare and file such registration statement and permit
it to become effective and to complete such securities or "blue sky" law action.
Upon such suspension, the Company shall issue a public announcement stating that
the exercisability of the Rights has been temporarily suspended, and the Company
shall also issue a public announcement at such time as the suspension shall no
longer be in effect. Failure of the Company to notify the Rights Agent of any
such suspension shall not affect the effectiveness thereof. Notwithstanding any
provision of this Agreement to the contrary, the Rights shall not be exercisable
in any jurisdiction unless the requisite qualification or exemption in such
jurisdiction shall have been effected. Until otherwise notified in writing by
the Company, the Rights Agent may assume that each purported exercise of the
Rights is permitted by this Agreement and by applicable law, and the Rights
Agent shall not be liable for acting in reliance upon such assumption.
(e) The Company covenants and agrees that, subject to Section
6, it will pay when due and payable any and all federal and state original issue
or transfer taxes and charges which may be payable in respect of the issuance or
delivery of the Rights or the Rights Certificates or of any stock certificate
for Preferred Shares issued upon exercise of the Rights. The Company shall not,
however, be required to pay any transfer tax which may be payable in respect of
any transfer or delivery of any Rights Certificate to a Person other than, or
the issuance of any stock certificate for Preferred Shares upon exercise of any
of the Rights represented by such Rights Certificate in a name other than, the
registered holder of such Rights Certificate or to issue or deliver any Rights
Certificate or stock certificate for Preferred Shares upon such transfer or
exercise until any such tax shall have been paid (any such tax being payable by
the holder of such Rights Certificate at the time of surrender thereof) or until
it has been established to the Company's reasonable satisfaction that no such
tax is due.
(f) After a Triggering Event, the provisions of this Section 9
shall apply, to the extent applicable and appropriate, to all shares of capital
stock and other securities then purchasable upon exercise of the Rights.
SECTION 10. RECORD DATE OF PREFERRED SHARE OWNERSHIP. The
Person in whose name any stock certificate for Preferred Shares is issued upon
exercise of any of the Rights shall for all purposes be deemed to have become
the holder of record of the Preferred Shares represented thereby on, and such
stock certificate shall be dated, the date upon which the Rights Certificate
evidencing such Rights was duly surrendered to the Rights Agent with proper
payment of the Exercise Price (and all applicable transfer taxes, if any);
PROVIDED, HOWEVER, that if the date of such surrender and payment shall be a
date upon which the registry books of the transfer agent for the
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Preferred Shares are closed, such Person shall be deemed to have become the
record holder of such Preferred Shares on, and such stock certificate shall be
dated, the next succeeding Business Day on which such registry books are open.
SECTION 11. ADJUSTMENT OF EXERCISE PRICE, NUMBER AND KIND OF
SHARES AND NUMBER OF RIGHTS. The Exercise Price, the number and kind of shares
of capital stock for which each Right is exercisable 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 Company shall at any time after
the date of this Agreement (A) declare a dividend on the Preferred Shares
payable in Preferred Shares, (B) subdivide the outstanding Preferred Shares into
a greater number of Preferred Shares, (C) combine or consolidate the outstanding
Preferred Shares into a smaller number of Preferred Shares or (D) issue any
shares of capital stock of any class in a reclassification of the Preferred
Shares (including any such reclassification in connection with a combination or
merger in which the Company is the continuing or surviving corporation), except
as otherwise provided in this Section 11(a) and in Section 7(d), the Exercise
Price in effect at the Close of Business on the record date for such dividend or
at the effective time of such subdivision, combination, consolidation or
reclassification, and the number and kind of shares of capital stock issuable
upon exercise of the Rights at such date or time, shall be proportionately
adjusted so that the registered holder of each Right exercised after such date
or time shall be entitled to receive the aggregate number and kind of shares of
capital stock which, if such Right had been exercised immediately prior to such
date or time and at a time when the registry books of the transfer agent for the
Preferred Shares were open, such registered holder would have been entitled to
receive by reason of such dividend, subdivision, combination, consolidation or
reclassification; PROVIDED, HOWEVER, that in no event shall the consideration to
be paid upon the exercise of one Right be less than the aggregate par value of
the shares of capital stock of the Company issuable upon the exercise thereof.
If an event shall occur which would require an adjustment under both this
paragraph (i) and paragraph (ii) of this subsection (a), the adjustment provided
for in this paragraph (i) shall be in addition to, and shall be made prior to,
any adjustment required pursuant to such paragraph (ii).
(ii) Subject to Section 24, in the event that any Person, either
alone or together with its Affiliates and Associates, shall become an
Acquiring Person, then, in such case and promptly following such
occurrence, proper provision shall be made so that the registered
holder of each Right, except as otherwise provided in Section 7(d),
shall thereafter have the right to receive, upon exercise thereof and
payment of an amount equal to the product determined by multiplying the
then current Exercise Price by the number of one one-hundredths of a
Preferred Share for which such Right was exercisable immediately prior
to such occurrence, in accordance with this Agreement, in lieu of
Preferred Shares, the number of shares of Common Stock determined
dividing such product by 50% of the Fair Market Value (determined as
provided in subsection (d) of this Section 11) of one share of Common
Stock on the date of such occurrence.
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(iii) In the event that there shall not be sufficient authorized and
unissued or treasury shares of Common Stock to permit the exercise in
full of the Rights in accordance with paragraph (ii) of this subsection
(a), the Company shall take all necessary action to authorize and
reserve for issuance such number of additional shares of Common Stock
as may from time to time be required to be issued upon the exercise in
full of all outstanding Rights and, if necessary, shall use its best
efforts to obtain stockholder approval thereof. Notwithstanding the
preceding sentence, if at least a majority of the Disinterested
Directors shall determine that such action is necessary or appropriate
and is not contrary to the best interests of the holders of the Rights,
such Disinterested Directors may cause the Company, in lieu of issuing
shares of Common Stock in accordance with such paragraph (ii), to
distribute, or if a sufficient number of shares of Common Stock cannot
be issued for such purpose in accordance with the provisions hereof,
the Company shall distribute, upon the exercise of each Right, cash,
debt securities, Preferred Shares, other shares of Preferred Stock,
other property or any combination thereof having an aggregate Fair
Market Value (determined as provided in subsection (d) of this Section
11) equal to the Fair Market Value (as so determined) of the number of
shares of Common Stock which otherwise would have been issuable
pursuant to such paragraph (ii). Any such decision by a majority of the
Disinterested Directors must be made and publicly announced within 30
days after the occurrence of any Section 11(a)(ii) Event.
(b) In the event that the Company shall fix a record date for
the making of any distribution to all registered holders of Preferred Shares of
options, warrants or rights entitling them (for a period expiring not later than
45 calendar days after such record date) to subscribe for or purchase Preferred
Shares (or shares of capital stock of any class of the Company having the same
(or more favorable) powers, preferences and rights as the Preferred Shares
("Equivalent Preferred Shares"), or securities convertible into or exchangeable
for Preferred Shares or Equivalent Preferred Shares, at a price per Preferred
Share or per Equivalent Preferred Share (or having a conversion or exchange
price per share, in the case of securities convertible into or exchangeable for
Preferred Shares or Equivalent Preferred Shares) less than the Fair Market Value
(determined as provided in subsection (d) of this Section 11) of one Preferred
Share on such record date, the Exercise Price to be in effect after such record
date shall be determined by multiplying the Exercise 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 which the aggregate offering price of the total number of
Preferred Shares and/or Equivalent Preferred Shares so to be offered (and/or the
aggregate initial conversion or exchange price, in the case of convertible or
exchangeable securities so to be offered) would purchase at such Fair Market
Value, and the denominator of which shall be the number of Preferred Shares
outstanding on such record date, plus the total number of Preferred Shares
and/or Equivalent Preferred Shares so to be offered (and/or into or for which
the convertible or exchangeable securities so to be offered are
-17-
initially convertible or exchangeable); PROVIDED, HOWEVER, that in no event
shall the consideration to be paid upon the exercise of one Right be less than
the aggregate par value of the shares of capital stock of the Company issuable
upon the exercise thereof. In case all or part of such subscription price may be
paid in a form other than cash, the value of such non-cash consideration shall
be its Fair Market Value (determined as provided in such subsection (d)).
Preferred Shares owned by or held for the account of the Company shall not be
deemed outstanding for the purpose of any computation provided for in this
subsection (b). The adjustment required by this subsection (b) shall be made
successively whenever such a record date is fixed; and in the event that such
distribution is not so made, the Exercise Price shall be adjusted to the
Exercise Price which would have been in effect if such record date had not been
fixed.
(c) In the event that the Company shall fix a record date for
the making of any distribution to all registered holders of Preferred Shares
(including any such distribution made in connection with a combination or merger
in which the Company is the continuing or surviving corporation) of cash (other
than a regular quarterly cash dividend), options, warrants, rights (other than
those referred to in subsection (b) of this Section 11), securities, evidences
of indebtedness or other property (excluding any dividend payable in Preferred
Shares, but including any dividend payable in other shares of capital stock),
the Exercise Price to be in effect after such record date shall be determined by
multiplying the Exercise Price in effect immediately prior to such record date
by a fraction, the numerator of which shall be the Fair Market Value (determined
as provided in subsection (d) of this Section 11) of one one-hundredth of a
Preferred Share on such record date, less the Fair Market Value (as so
determined) of the cash, options, warrants, rights, securities, evidences of
indebtedness or other property so to be distributed and properly attributable to
one one-hundredth of a Preferred Share, and the denominator of which shall be
such Fair Market Value of one one-hundredth of a Preferred Share; PROVIDED,
HOWEVER, that in no event shall the consideration to be paid upon the exercise
of one Right be less than the aggregate par value of the shares of capital stock
of the Company issuable upon the exercise thereof. The adjustment required by
this subsection (c) shall be made successively whenever such a record date is
fixed; and in the event that such distribution is not so made, the Exercise
Price shall be adjusted to the Exercise Price which would have been in effect if
such record date had not been fixed.
(d) For the purpose of any computation required under this
Agreement, "Fair Market Value," when used with respect to Preferred Shares or
shares of Common Stock or other capital stock of any class (collectively, a
"Stock"), to any option, warrant, right or other security or evidence of
indebtedness (collectively, a "Security") or to any other property, shall be
determined as provided in this subsection (d):
(i) In the case of any Stock or Security which is publicly
traded, the Fair Market Value on any date shall be deemed to be the
average of the daily closing prices per share of such Stock or per unit
of such Security for the 30 consecutive Trading Days immediately prior
to such date; PROVIDED, HOWEVER,
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that in the event that the Fair Market Value per share of any Stock is
determined during a period commencing after the public announcement by
its issuer of (A) a dividend or distribution on such Stock payable in
shares of such Stock or securities convertible into or exchangeable
for shares of such Stock or (B) a subdivision, combination,
consolidation or reclassification of such Stock, and ending prior to
the expiration of the 30 Trading Days after the ex-dividend date for
such dividend or distribution, or the record date for such
subdivision, combination, consolidation or reclassification, then, in
each such case, the Fair Market Value of such Stock shall be properly
adjusted to take into account "ex-dividend" trading. The closing price
for each day shall be the last sale price, regular way, or, in case no
such sale shall take place on such day, the average of the closing bid
and asked prices, regular way, in either case as reported in the
principal consolidated transaction reporting system with respect to
securities listed or admitted to trading on the New York Stock
Exchange or, if such Stock or 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 or admitted to trading on the principal national securities
exchange on which such Stock or Security is listed or admitted to
trading; or if such Stock or Security is not listed or admitted to
trading on any national securities exchange, the last quoted price or,
if not so quoted, the average of the last quoted high bid and low
asked prices in the over-the-counter market, as reported by NASDAQ or
any other similar system then in use; or if on any such day no bid for
such Stock or Security is quoted by any such organization, the average
of the closing bid and asked prices, as furnished by a professional
market maker making a market in such Stock or Security selected by the
Board. If during any relevant period no market maker is making a
market in such Stock or Security, its Fair Market Value on a specified
date shall be determined reasonably and with utmost good faith to the
holders of the Rights by the Board; PROVIDED, HOWEVER, that if at the
time of such determination there shall be an Acquiring Person, the
Fair Market Value of such Stock or Security on such date shall be
determined by a nationally recognized investment banking firm selected
by the Board, which determination shall be described in a statement
filed with the Rights Agent and shall be binding on the Company, the
Rights Agent and the holders of the Rights. The term "Trading Day"
shall mean a day on which the principal national securities exchange
on which such Stock or Security is listed or admitted to trading is
open for the transaction of business or, if such Stock or Security is
not listed or admitted to trading on any national securities exchange,
a Business Day.
(ii) In the case of any Stock or Security which is not publicly
traded, the Fair Market Value on any date shall be the fair value per
share of such Stock or per unit of such Security as determined
reasonably and with utmost good faith to the holders of the Rights by
the Board; PROVIDED, HOWEVER, that if at the time of such determination
there shall be an Acquiring Person, the Fair Market Value of such Stock
or Security on such date shall be determined by a nationally recognized
investment banking firm selected by the Board, which determination
shall be
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described in a statement filed with the Rights Agent and shall
be binding on the Company, the Rights Agent and the holders of the
Rights.
(iii) In the case of any property which is not a Stock or a
Security, the Fair Market Value on any date shall be determined
reasonably and with utmost good faith to the holders of Rights by the
Board; PROVIDED, HOWEVER, that if at the time of such determination
there shall be an Acquiring Person, the Fair Market Value of such
property on such date shall be determined by a nationally recognized
investment banking firm selected by the Board, which determination
shall be described in a statement filed with the Rights Agent and shall
be binding on the Company, the Rights Agent and the holders of the
Rights.
(e) No adjustment in the Exercise Price shall be required
unless such adjustment would require an increase or decrease of at least 1% in
the Exercise Price then in effect; PROVIDED, HOWEVER, that any adjustments which
by reason of this subsection (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 whole cent, to the nearest
one ten-thousandth of a share of Common Stock or other capital stock of any
class (other than Preferred Shares) or to the nearest one one-millionth of a
Preferred Share, as the case may be. Notwithstanding the first sentence of this
subsection (e), any adjustment required by this Section 11 shall be made no
later than the earliest of (i) three years after the date
of the occurrence requiring such adjustment, (ii) the Redemption Date and (iii)
the Final Expiration Date.
(f) If as a result of an adjustment required by any Triggering
Event the holder of any Rights thereafter exercised shall become entitled to
receive any shares of capital stock of any class of the Company (other than
Preferred Shares), the number of such other shares so receivable upon exercise
of any Rights shall be subject to adjustment from time to time in a manner and
on terms as nearly equivalent as reasonably possible to the provisions with
respect to the Preferred Shares contained in this Section 11, and the provisions
of Sections 7, 9, 10, 13 and 14 with respect to the Preferred Shares shall apply
on like terms to any such other shares.
(g) All Rights originally issued by the Company subsequent to
any adjustment made to the Exercise Price hereunder shall evidence the right to
purchase, at the adjusted Exercise Price, the number of one one-hundredths of a
Preferred Share purchasable from time to time hereunder upon exercise of the
Rights, all subject to further adjustment as provided herein.
(h) Unless the Company shall have exercised the option
provided in subsection (i) of this Section 11, upon each adjustment of the
Exercise Price as a result of the calculations required by subsection (b) or (c)
of this Section 11, each Right outstanding immediately prior to the making of
such Exercise Price adjustment shall thereafter evidence the right to purchase,
at the adjusted Exercise Price, the number of one one-hundredths of a Preferred
Share (calculated to the nearest one one-millionth)
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determined by (i) multiplying the number of one one-hundredths of a Preferred
Share purchasable upon exercise of such Right immediately prior to such
adjustment by the Exercise Price in effect immediately prior to such adjustment
and (ii) dividing the product so obtained by the Exercise Price in effect
immediately after such adjustment.
(i) The Company may elect, on or after the date on which any
adjustment of the Exercise Price is required to be made hereunder, to adjust the
number of Rights outstanding in substitution for making an adjustment in the
number of one one-hundredths of a Preferred Share purchasable upon exercise of
each Right. Each Right outstanding after such an adjustment in the number of
Rights shall be exercisable for the same number of one one-hundredths of a
Preferred Share as such Right was exercisable for immediately prior to such
adjustment; but each Right held of record prior to such adjustment shall become
the number of Rights (calculated to the nearest one ten-thousandth) determined
by dividing the Exercise Price in effect immediately prior to the occurrence
requiring the adjustment of the Exercise Price by the Exercise Price in effect
immediately after such adjustment of the Exercise Price. The Company shall make
a prompt public announcement of its election to adjust the number of Rights
outstanding, indicating the record date for the adjustment and, if
known at the time of such announcement, the amount of the adjustment to be made.
Such record date may be the date on which the Exercise Price is required to be
adjusted or any day thereafter, unless the Rights Certificates shall have been
issued, in which case such record date shall be at least 10 days after the date
of such public announcement. If the Rights Certificates shall have been issued,
upon each adjustment of the number of Rights outstanding pursuant to this
subsection (i), the Company shall, as promptly as practicable, cause to be
distributed to each registered holder of the Rights Certificates on such record
date Rights Certificates evidencing, subject to Section 14, the additional
Rights to which such registered holder shall be entitled as a result of such
adjustment; or, at its option, the Company shall cause to be distributed to each
such registered holder, in substitution and replacement for the Rights
Certificates held by such registered holder prior to the date of such
adjustment, but only upon surrender thereof (if so required by the Company), new
Rights Certificates evidencing all the Rights to which such registered holder
shall be entitled after such adjustment. Rights Certificates so distributed
shall be executed and countersigned in the manner provided in Section 5 (and may
designate, at the option of the Company, the adjusted Exercise Price) and shall
be registered in the names of the registered holders of the Rights Certificates
on the record date specified in the aforesaid public announcement.
(j) Irrespective of any adjustment or change in the Exercise
Price or the number of one one-hundredths of a Preferred Share issuable upon
exercise of the Rights, the Rights Certificates theretofore and thereafter
issued may continue to designate the Exercise Price and the number of one
one-hundredths of a Preferred Share which were designated in the Rights
Certificates originally issued hereunder.
(k) Before taking any action which would cause an adjustment
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reducing the Exercise Price below one one-hundredth of the then par value, if
any, of the Preferred Shares issuable upon exercise of the Rights, the Company
shall take any corporate action which may, in the opinion of its counsel, be
necessary in order that the Company may validly and legally issue fully paid and
nonassessable Preferred Shares at such adjusted Exercise Price.
(l) In any case in which this Section 11 shall require an
adjustment of the Exercise Price effective as of the record date for a
particular event, the Company may elect to defer until the occurrence of such
event the issuing to the holder of any Rights exercised after such record date
of the Preferred Shares (and/or the other shares of capital stock, securities or
other property of the Company, if any) issuable upon such exercise in excess of
the Preferred Shares (and/or the other shares of capital stock, securities or
other property of the Company, if any) issuable upon such exercise on the basis
of the Exercise Price in effect immediately prior to such adjustment; PROVIDED,
HOWEVER, that the Company shall deliver to such holder a due xxxx or other
appropriate instrument evidencing such holder's right to receive such excess
upon the occurrence of such event.
(m) Anything in this Section 11 to the contrary
notwithstanding, the Board shall be entitled to make reductions in the Exercise
Price, in addition to the adjustments expressly required by this Section 11, as
and to the extent that the Board, in its sole discretion, shall determine to be
advisable in order that any dividend on the Preferred Shares payable in
Preferred Shares, any subdivision, combination or consolidation of the Preferred
Shares (by reclassification or otherwise than by payment of dividends in
Preferred Shares) into a greater or lesser number of Preferred Shares, any
issuance of Preferred Shares solely for cash at less than the Fair Market Value
thereof, any issuance solely for cash of Preferred Shares or securities which by
their terms are convertible into or exchangeable for Preferred Shares or any
issuance of options, warrants, rights, securities, evidences of indebtedness or
other property subject to subsection (b) or (c) of this Section 11, hereafter
made by the Company to the holders of the Preferred Shares, shall not be taxable
to such holders.
(n) In the event that the Company shall at any time after the
date of this Agreement and prior to the Distribution Date (i) declare a dividend
on its outstanding shares of Common Stock payable in shares of Common Stock or
(ii) effect a subdivision, combination or consolidation of its outstanding
shares of Common Stock (by reclassification or otherwise than by payment of
dividends in shares of Common Stock) into a greater or lesser number of shares
of Common Stock, then, in each such case: (i) the number of one one-hundredths
of a Preferred Share purchasable after such event upon proper exercise of each
Right shall be determined by multiplying the number of one one-hundredths of a
Preferred Share so purchasable immediately prior to such event by a fraction,
the numerator of which shall be the number of shares of Common Stock outstanding
immediately prior to such event and the denominator of which shall be the number
of shares of Common Stock outstanding immediately after such event; and (ii)
each share of Common Stock outstanding immediately after such event shall have
issued with respect to it the same number of Rights which each share
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of Common Stock outstanding immediately prior to such event had issued with
respect to it. The adjustment required by this subsection (n) shall be made
successively whenever such a dividend is declared or such a subdivision,
combination or consolidation is effected.
(o) Except as permitted by Sections 23 and 27, the Company
covenants and agrees that, after the Distribution Date, it will not take, or
permit any of its Subsidiaries to take, any action if at the time such action
would be taken it is reasonably foreseeable that such action would eliminate or
substantially diminish the benefits intended to be afforded by the Rights.
SECTION 12. CERTIFICATE OF ADJUSTED EXERCISE PRICE OR NUMBER
OF SHARES. Whenever any adjustment shall be required by Section 11, 13 or 23(g),
the Company shall promptly (a) prepare a certificate setting forth such
adjustment and a brief statement of the facts requiring such adjustment, (b)
file with the Rights Agent and with each transfer agent for the Preferred Shares
or the Common Stock of the Company a copy of such certificate and (c) mail a
brief summary thereof to each registered holder of the Rights in accordance with
Section 26. The Rights Agent shall be fully protected in relying on any such
certificate and on any adjustment described therein and shall not be deemed to
have knowledge of any such adjustment unless and until it shall have received
such certificate.
SECTION 13. CONSOLIDATION, MERGER OR SALE OR TRANSFER OF
ASSETS OR EARNING POWER.
(a) In the event that, on or after the occurrence of any
Section 11(a)(ii) Event, directly or indirectly: (i) the Company shall
consolidate with, or merge with and into, any Interested Stockholder or, if in
such consolidation or merger all holders of the Common Stock of the Company are
not treated the same, any other Person (other than a wholly-owned Subsidiary of
the Company in a transaction not prohibited by Section 11(o)), so that the
Company shall not be the continuing or surviving corporation, (ii) any
Interested Stockholder or, if in such merger all holders of the Common Stock of
the Company are not treated the same, any other Person (other than a
wholly-owned Subsidiary of the Company in a transaction not prohibited by
Section 11(o)) shall merge with and into the Company, so that the Company shall
be the continuing or surviving corporation, and in connection with such merger
either (A) all or part of the outstanding shares of Common Stock of the Company
shall be converted or changed into or exchanged for capital stock or other
securities of any other Person (or the Company), cash and/or other property or
(B) such shares of Common Stock shall remain outstanding, unconverted and
unchanged, or (iii) the Company shall sell or otherwise transfer (or one or more
of its Subsidiaries shall sell or otherwise transfer), in one or a series of
related transactions, assets or earning power aggregating 50% or more of the
assets or earning power of the Company and its Subsidiaries (taken as a whole)
to any Interested Stockholder or, if in such transaction or transactions the
holders of the Common Stock of the Company are not treated the same, any other
Person or Persons (other than the Company or one or more of its wholly-owned
-23-
Subsidiaries in one or more transactions, each of which is not prohibited by
Section 11(o)), then, in each such case, proper provision shall be made so that
(w) the registered holder of each Right, except as otherwise provided in Section
7(d), shall thereafter have the right to receive, upon exercise thereof and
payment of an amount equal to the product determined by multiplying the then
current Exercise Price by the number of one one-hundredths of a Preferred Share
for which such Right is then exercisable, in accordance with this Agreement, in
lieu of Preferred Shares, the number of freely tradable shares (which shall be
duly authorized, validly issued, fully paid and non-assessable) of Common Stock
of the Principal Party or, in the case of a merger described in clause (ii) of
this sentence in which the Common Stock of the Company shall remain outstanding,
unconverted and unchanged, of the Company, free and clear of all rights of call
or first refusal, liens, encumbrances or other adverse claims, determined by
dividing such product by 50% of the Fair Market Value (determined as provided in
Section 11(d)) of the shares of Common Stock of such Principal Party (or, if
appropriate, the Company) on the date of consummation of such Section 13 Event;
(x) such Principal Party shall thereafter be liable for, and shall assume, by
reason of the consummation of such Section 13 Event, all the obligations and
duties of the Company under this Agreement; (y) the term "Company" shall
thereafter be deemed to refer to such Principal Party, it being specifically
intended that the provisions of Section 11 shall apply to such Principal Party;
and (z) such Principal Party shall take such steps (including, but not limited
to, the reservation of a sufficient number of its shares of Common Stock to
permit exercise of all outstanding Rights in accordance with this subsection (a)
and the distribution of cash, debt securities, shares and other property in
accordance with Section 11(a)(iv))in connection with the consummation of such
Section 13 Event as may be necessary to assure that the provisions hereof shall
thereafter be applicable, as nearly as reasonably possible, in relation to the
shares of Common Stock thereafter deliverable upon exercise of the Rights.
(b) After the Distribution Date, the Company shall not
consolidate or merge with any other Person (other than a wholly-owned Subsidiary
of the Company in a transaction not prohibited by Section 11(o)), or sell or
otherwise transfer (or permit one or more of its Subsidiaries to sell or
otherwise transfer), in one or a series of related transactions, assets or
earning power aggregating 50% or more of the assets or earning power of the
Company and its Subsidiaries (taken as a whole) to any other Person or Persons
(other than the Company or one or more of its wholly-owned Subsidiaries in one
or more transactions, each of which is not prohibited by Section 11(o)), if (i)
at the time of or immediately after the consummation of such transaction there
are any options, warrants, rights, conversion or exchange privileges or
securities outstanding or any written or oral agreements, arrangements or
understandings (including provisions contained in the Company's Certificate of
Incorporation or By-laws) in effect which, as a result of the consummation of
such transaction, would eliminate or substantially diminish the benefits
intended to be afforded by the Rights, or (ii) prior to, at the time of or
immediately after the consummation of such transaction the stockholders of the
Person who constitutes, or would constitute, the Principal Party for the purpose
of subsection (a) of this Section 13 shall have received a distribution of
-24-
Rights previously owned by such Person or any of its Affiliates or Associates.
(c) The Company shall not consummate any Section 13 Event
unless prior thereto (i) the Principal Party shall have a sufficient number of
authorized shares of its Common Stock which have not been issued or reserved for
issuance to permit the exercise in full of the Rights in accordance with this
Section 13 and (ii) the Company, the Principal Party and each other Person who
may become the Principal Party as a result of the consummation of such Section
13 Event shall have executed and delivered to the Rights Agent a supplemental
agreement providing (x) for the implementation of all the terms and conditions
set forth in this Section 13 and (y) that, as soon as practicable after the date
of such Section 13 Event, the Principal Party, at its own expense, shall:
(A) prepare and file a registration statement on an
appropriate form under the Securities Act with respect to the
Rights and the securities purchasable upon exercise thereof,
and use its best efforts to cause such registration statement
to become effective as soon as practicable after such filing
and to remain effective (with a prospectus which at all times
meets the requirements of the Securities Act) until the
earliest of the date as of which the Rights are no longer
exercisable for such securities, the Redemption Date and the
Final Expiration Date;
(B) use its best efforts to qualify or register the
Rights and the securities purchasable upon exercise thereof
under the securities or "blue sky" laws of such jurisdictions
as may be necessary or appropriate in connection with the
exercisability of the Rights;
(C) use its best efforts to list (or continue the
listing of) the Rights and the securities purchasable upon
exercise thereof on a national securities exchange or to meet
the eligibility requirements for quotation on NASDAQ; and
(D) deliver to the registered holders of the Rights
historical financial statements for the Principal Party and
each of its Affiliates complying in all material respects with
the requirements for registration of securities on Form 10
under the Exchange Act.
(d) Notwithstanding anything in this Agreement to the
contrary, Section 13 shall not apply to a transaction described in clause (i) or
(ii) of subsection (a) thereof if (i) such transaction is consummated with a
Person or Persons who acquired their shares of Common Stock of the Company
pursuant to a Permitted Offer, (ii) the price per share of Common Stock of the
Company provided in such transaction shall not be less than the price per share
of Common Stock of the Company paid to all holders whose shares were purchased
pursuant to such Permitted Offer and (iii)the form of consideration being
offered to the remaining holders of the Common Stock of the Company pursuant to
such transaction is the same as the form of consideration paid
-25-
pursuant to such Permitted Offer. Upon consummation of any transaction
authorized by this subsection (d), all Rights shall expire.
(e) "Principal Party" shall mean: in the case of any
transaction described in clause (i) or (ii) of subsection (a) of this Section
13, the Person which is the issuer of the securities into which shares of Common
Stock of the Company are being converted or changed in such transaction or, if
there shall be more than one such issuer, the issuer having shares of Common
Stock with the greatest aggregate market value; or if no securities are being
issued in such transaction for shares of Common Stock of the Company, the Person
which is the other party to such transaction or, if there shall be more than one
such Person, the Person having shares of Common Stock with the greatest
aggregate market value; and in the case of any transaction described in clause
(iii) of such subsection (a), the Person which is the party receiving the
greatest portion of the assets or earning power sold or otherwise transferred
pursuant to such transaction or transactions; PROVIDED, HOWEVER, that in any
such case (i) if the shares of Common Stock of such Person shall not at the time
of the consummation of such transaction have been continuously registered under
Section 12 of the Exchange Act during the immediately preceding 12-month period,
and such Person shall be a direct or indirect Subsidiary or Affiliate of another
Person the shares of Common Stock of which shall have been so registered,
"Principal Party" shall mean such other Person; and (ii) if such Person shall be
a direct or indirect Subsidiary or Affiliate of more than one other Person, the
shares of Common Stock of two or more of which shall have been so registered,
"Principal Party" shall mean whichever of such other Persons shall have Common
Stock with the greatest aggregate market value; and (iii) if such Person shall
be owned, directly or indirectly, by a joint venture formed by two or more
Persons which are not owned, directly or indirectly, by the same Person, the
rules set forth in clauses (i) and (ii) of this proviso shall apply to each
chain of ownership of any joint venturer as though such joint venture were a
"Subsidiary" of all of such joint venturers, and the Principal Party in each
such chain shall bear the obligations and duties set forth in this Section 13 in
the same proportion as their direct or indirect ownership interest in such
Person bears to the total of such ownership interests.
(f) If, in the case of any transaction described in clause
(iii) of subsection (a) of this Section 13, the Person or Persons to whom assets
or earning power are sold or otherwise transferred are individuals, then, in
lieu of any other payment or distribution required by this Section 13, and the
Company shall require as a condition to such transaction that, such Person or
Persons shall pay to each holder of a Rights Certificate, upon its surrender to
the Rights Agent and in exchange therefor (without requiring any payment by such
holder), cash in the amount determined by multiplying the then current Exercise
Price by the number of one one-hundredths of a Preferred Share for which a Right
is then exercisable.
(g) In no event shall the Rights Agent have any obligations or
duties in respect of any Section 13 Event, except as expressly set forth in this
Agreement. The Rights Agent may rely, and shall be fully protected in relying
upon, a certificate of the
-26-
Company stating that the provisions of this Section 13 have been fulfilled. The
prior written consent of the Rights Agent shall be required in connection with
any supplemental agreement which alters or impairs the rights, obligations,
duties or immunities of the Rights Agent hereunder.
(h) The provisions of this Section 13 shall similarly apply to
successive consolidations, mergers, sales or other transfers. In the event that
any Section 13 Event shall occur at any time after the occurrence of any Section
11(a)(ii) Event, the Rights which have not been theretofore exercised shall
thereafter be exercisable in the manner described in this Section 13.
SECTION 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES.
(a) The Company shall not be required to issue fractional
Rights or to distribute Rights Certificates which evidence fractional Rights. If
the Company shall determine not to issued fractional Rights, the Company shall
pay, in lieu of issuing fractional Rights, to the registered holders of the
Rights with respect to which fractional Rights would otherwise be issuable an
amount in cash equal to the same fraction of the Fair Market Value (determined
as provided in Section 11(d) for the Trading Day immediately prior to the date
on which such fractional Rights would otherwise have been issued) of one Right.
(b) The Company shall not be required to issue fractional
Preferred Shares (other than fractions which are multiples of one one-hundredth
of a Preferred Share) upon exercise of the Rights or to distribute stock
certificates which evidence fractional Preferred Shares (other than fractions
which are multiples of one one-hundredth of a Preferred Share). If the Company
shall determine not to issue fractional Preferred Shares that are not multiples
of one one-hundredth of a Preferred Share, the Company shall pay to the
registered holders of the Rights Certificates at the time Rights represented
thereby are exercised, in lieu of such fractional Preferred Shares, an amount in
cash equal to the same fraction of the Fair Market Value (determined as provided
in Section 11(d) for the Trading Day immediately prior to the date of such
exercise) of one one-hundredth of a Preferred Share.
(c) Each holder of a Right, by accepting the same, expressly
waives such holder's right to receive or exercise any fractional Right or to
receive any fractional Preferred Share upon the exercise of such Right (except
as provided in this Section 14).
SECTION 15. RIGHTS OF ACTION. All rights of action in respect
of this Agreement, other than rights of action which the Rights Agent may have
under Sections 18 and 20, are vested in the registered holders of the Rights
Certificates (or, prior to the Distribution Date, the registered holders of the
Common Stock of the Company); and the registered holder of any Rights
Certificate (or, prior to the Distribution Date, of any stock certificate for
shares of such Common Stock), without the consent of the Rights Agent or of the
holder of any other Rights Certificate (or, prior
-27-
to the Distribution Date, of any other stock certificate for shares of Common
Stock), may, on such registered holder's own behalf and for such registered
holder's own benefit, enforce, and may institute and maintain any suit, action
or proceeding against the Company to enforce, or otherwise act in respect of,
such registered holder's right to exercise the Rights evidenced by such Rights
Certificate (or, prior to the Distribution Date, such stock certificate) in the
manner provided in such Rights Certificate and in this Agreement. Without
limiting the generality of the foregoing or any remedies available to the
holders of the Rights, it is specifically acknowledged that the registered
holders of the Rights would not have an adequate remedy at law for any breach of
this Agreement and will be entitled to specific performance of the obligations
and duties under, and injunctive relief against any actual or threatened
violations of the obligations and duties of any Person subject to, this
Agreement.
SECTION 16. AGREEMENTS OF HOLDERS OF RIGHTS. Each holder of a
Right, by accepting the same, consents and agrees with the Company and the
Rights Agent and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights shall be
transferable only simultaneously and together with the transfer of shares of
Common Stock of the Company;
(b) after the Distribution Date, the Rights Certificates shall
be transferable on the registry books of the Rights Agent only if surrendered at
the principal office of the Rights Agent, with the Form of Assignment and
Certification of Status on the reverse side thereof duly executed, together with
such signature guarantees and other documentation as the Rights Agent may
reasonably request;
(c) subject to Sections 6 and 7(d), the Company and the Rights
Agent may deem and treat the Person in whose name any Rights Certificate (or,
prior to the Distribution Date, any stock certificate for Common Stock of the
Company) is registered as the absolute owner thereof and of the Rights
represented thereby (notwithstanding any notations of ownership or other writing
on such Rights Certificate or stock certificate made by anyone other
than the Company or the Rights Agent) for all purposes whatsoever, and neither
the Company nor the Rights Agent shall be affected by any notice to the
contrary; and
(d) neither the Company nor the Rights Agent shall have any
liability to any holder of a Right or to any other Person because of its
inability to perform any of its obligations or duties under this Agreement by
reason of any applicable law, 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 rule,
regulation or executive order promulgated or enacted by any such governmental
authority prohibiting or otherwise restraining performance of any such
obligation or duty; PROVIDED, HOWEVER, that the Company shall use its best
efforts to have any such injunction, order, decree or ruling lifted or otherwise
overturned as soon as reasonably possible.
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SECTION 17. RIGHTS CERTIFICATE HOLDER NOT DEEMED A
STOCKHOLDER. No holder, as such, of any Rights Certificate shall be entitled to
vote, to receive dividends or other distributions on or to exercise any
preemptive rights with respect to, or shall be deemed for any other purpose to
be the holder of, the Preferred Shares or other shares of capital stock of any
class of the Company which may at the time be issuable upon exercise of the
Rights represented thereby; nor shall anything contained herein or in any Rights
Certificate be construed to confer upon the holder of any Rights Certificate, as
such, any of the rights of a stockholder of the Company, or any right to vote
for the election of directors or upon any other matter submitted to stockholders
at any meeting thereof, to give or withhold consent to any corporate action, to
receive notice of meetings or other actions affecting stockholders (except as
provided in Section 25) or to receive dividends, subscription rights or other
distributions, until the Rights represented by such Rights Certificate shall
have been exercised, in whole or in part, in accordance with the provisions
hereof.
SECTION 18. CONCERNING THE RIGHTS AGENT.
(a) The Company covenants and agrees to pay to the Rights
Agent reasonable compensation for all services rendered by it hereunder and,
from time to time on the written request of the Rights Agent, to reimburse it
for all reasonable expenses and counsel fees incurred in connection with the
acceptance and administration of this Agreement and the performance of its
obligations and duties hereunder. The Company also covenants and agrees to
indemnify the Rights Agent for, and to hold it harmless against, any loss,
liability or expense, incurred without negligence, bad faith or willful
misconduct on its part, for any action taken, suffered or omitted by it in
connection with the acceptance and administration of this Agreement and the
performance of its obligations and duties hereunder, including the costs and
expenses of defending against any claim of liability arising therefrom, directly
or indirectly.
(b) The Rights Agent shall be protected and shall incur no
liability for, or in respect of, any action taken, suffered or omitted by it in
connection with its administration of this Agreement in reliance upon any Rights
Certificate, stock certificate for Preferred Shares, Common Stock or other
shares of capital stock of the Company, instrument of assignment or transfer,
power of attorney, endorsement, affidavit, notice, direction, consent,
certificate, statement or other paper or document believed by it to be genuine
and to be executed and, where necessary, verified or acknowledged by the proper
Person or Persons.
SECTION 19. MERGER OR CONSOLIDATION OF THE RIGHTS AGENT.
(a) Any corporation into which the Rights Agent or any
successor Rights Agent may be merged or with which it may be consolidated, or
any corporation resulting from any merger or consolidation to which the Rights
Agent or any successor Rights Agent shall be a party, or any corporation
succeeding to the stockholder services
-29-
or corporate trust business of the Rights Agent or any successor Rights Agent,
shall be the successor to the Rights Agent under this Agreement without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, provided that such corporation would be eligible for appointment
as successor Rights Agent under Section 21. In case at the time any successor
Rights Agent shall succeed to the agency created by this Agreement any of the
Rights Certificates countersigned by its predecessor Rights Agent shall not have
been delivered, such successor Rights Agent may adopt the counter signature of
its predecessor Rights Agent and deliver the Rights Certificates so
countersigned; or in case at such time any of the Rights Certificates shall not
have been countersigned, such successor Rights Agent may countersign such Rights
Certificates either in the name of its predecessor Rights Agent or in the name
of such successor Rights Agent; and in all such cases, such Rights Certificates
shall have the full force and effect provided therein and in this Agreement.
(b) In case at any time the name of the Rights Agent shall be
changed and at such time any of the Rights Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the countersignature
under its prior name and deliver the Rights Certificates so countersigned; or in
case at such time any of the Rights Certificates shall not have been
countersigned, the Rights Agent may countersign such Rights Certificates either
in its prior name or in its changed name; and in all such cases, such Rights
Certificates shall have the full force and effect provided therein and in this
Agreement.
SECTION 20. DUTIES OF THE RIGHTS AGENT. The Rights
Agent undertakes the obligations and duties imposed by this Agreement upon the
following terms and conditions, by all of which the Company and the holders of
the Rights Certificates (or, prior to the Distribution Date, the stock
certificates for Common Stock of the Company), by accepting the same, shall be
bound, and no implied obligations or duties shall be read into this Agreement
against the Rights Agent:
(a) the Rights Agent may consult with legal counsel (who may
be legal counsel for the Company), and the written opinion of such legal counsel
shall be full and complete authorization and protection to the Rights Agent as
to any action taken, suffered or omitted by it in good faith and in accordance
with such opinion;
(b) whenever in the performance of its duties under this
Agreement the Rights Agent shall deem it necessary or desirable that any fact or
matter be proved or established by the Company prior to taking, suffering or
omitting 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 executed by any one of the
Chairman of the Board, the President, any Vice President, the Treasurer or the
Secretary of the Company and delivered to the Rights Agent; and such certificate
shall be full and complete authorization and protection to the Rights Agent as
to any action taken, suffered or omitted by it in good faith in reliance upon
such certificate;
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(c) the Rights Agent shall be liable hereunder to the Company
and any other Person only for its own negligence, bad faith or willful
misconduct;
(d) the Rights Agent shall not be liable for or by reason of
any of the statements of fact or recitals contained in this Agreement or in the
Rights Certificates (except its countersignature thereon) or be required to
verify the same, but all such statements and recitals are and shall be deemed to
have been made by the Company only;
(e) the Rights Agent shall not be responsible for the validity
of this Agreement or the execution and delivery hereof (except for its due
execution hereof) or for the validity or execution of any Rights Certificate
(except for its countersignature thereon); nor shall the Rights Agent be
responsible for any breach by the Company of any covenant or condition contained
in this Agreement or in any Rights Certificate; nor shall the Rights Agent be
responsible for any change in the exercisability of the Rights (including Rights
becoming void pursuant to Section 7(d)), for any adjustment or change (or for
the manner or method of determining same) in the terms of the Rights (including
any adjustment or change in the Exercise Price or in the number or kind of
shares, securities or other property issuable upon the exercise thereof)
required by Section 11, 13, 23 or 24 or for ascertaining the existence of facts
which would require any such change or adjustment (except with respect to the
exercise of Rights evidenced by Rights Certificates after actual notice, in the
manner provided in Section 12, that such change or adjustment is required); nor
shall the Rights Agent by any act hereunder be deemed to have made any
representation or warranty as to the authorization or reservation of any
Preferred Shares or shares of Common Stock to be issued pursuant to this
Agreement or any Rights Certificate or as to whether any Preferred Shares or
shares of Common Stock will, when issued, be validly authorized and issued and
fully paid and nonassessable;
(f) the Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed, acknowledged and
delivered all such further 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 obligations and
duties hereunder from any one of the Chairman of the Board, the President, any
Vice President, the Treasurer or the Secretary of the Company, and to apply to
such officers for advice or instructions in connection with its obligations and
duties; and the Rights Agent shall not be liable for any action taken, suffered
or omitted by it in good faith and in accordance with the written instructions
of any such officer or for any delay in acting while waiting for such
instructions;
(h) the Rights Agent and any stockholder, director, officer or
employee
-31-
of the Rights Agent may buy, sell or deal in the Rights or in any other
securities of the Company (including the Preferred Shares and its Common Stock)
or become pecuniarily interested in any transaction in which the Company (or any
of its Subsidiaries) may be interested, or contract with or lend money to the
Company (or any of its Subsidiaries), and may otherwise act as fully and freely
as though it were not the Rights Agent under this Agreement; and nothing herein
shall preclude the Rights Agent from acting in any other capacity for the
Company, any of its Subsidiaries or any other entity;
(i) the Rights Agent may execute and exercise any of the
rights or powers hereby vested in it or perform any of its obligations or duties
hereunder either directly 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 attorney or agent or for any loss to the
Company resulting from any such act, default, neglect or misconduct, provided
the Rights Agent exercised reasonable care in the selection and continued
employment of such attorney or agent;
(j) if, with respect to any Rights Certificate surrendered to
the Rights Agent for exercise or transfer, the Form of Certification of Status
attached to the Form of Election to Purchase or the Form of Assignment, as the
case may be, has either not been completed or indicates an affirmative response
to Question 1 and/or 2 thereof, the Rights Agent shall not take any further
action with respect to the requested exercise or transfer without first
consulting with the Company; and
(k) 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 obligations or duties or in the exercise of its
rights or powers hereunder 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.
SECTION 21. RESIGNATION OR REMOVAL OF THE RIGHTS AGENT. The
Rights Agent or any successor Rights Agent may resign and be discharged from its
obligations and duties under this Agreement upon 30 days' prior notice to the
Company and to each transfer agent for the Preferred Shares and for the Common
Stock of the Company, sent by registered or certified mail, postage prepaid, and
to each registered holder of the Rights Certificates, sent by first-class mail,
postage prepaid. The Company may remove the Rights Agent or any successor Rights
Agent upon 30 days' prior notice to the Rights Agent or successor Rights Agent,
as the case may be, and to each transfer agent for the Preferred Shares and for
the Common Stock of the Company, sent by registered or certified mail, postage
prepaid, and to each registered holder of the Rights Certificates, sent by
first-class mail, postage prepaid. If the Rights Agent or any successor Rights
Agent shall resign or be removed or shall otherwise become incapable of acting,
the Company shall appoint a successor Rights Agent. If the Company shall fail to
make such appointment within 30 days after giving notice of such removal or
after receiving notice of such resignation or incapacity, either from the
resigning or incapacitated Rights Agent or from the registered holder of any
Rights
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Certificate (who shall, with such notice, submit its Rights Certificate for
inspection by the Company), then the incumbent Rights Agent or the registered
holder of any Rights Certificate may apply to any court of competent
jurisdiction for the appointment of a successor Rights Agent. Any successor
Rights Agent, whether appointed by the Company or by such a court, shall be (a)
a corporation organized and doing business under the laws of the United States
of America, the State of Delaware, the State of New York or the State of
Illinois (or of any other state so long as such corporation is authorized to do
business as a banking institution in the State of Delaware, the State of New
York or the State of Illinois), be in good standing under the laws of the
jurisdiction of its incorporation, have an office in the State of Delaware, the
State of New York or the State of Illinois, be authorized under such laws to
exercise corporate trust or stock transfer powers, be subject to supervision or
examination by federal or state authority and have at the time of its
appointment as Rights Agent a combined capital and surplus of at least
$50,000,000 or (b) an affiliate of a corporation described in clause (a) of this
sentence. After its appointment, the successor Rights Agent shall be vested with
the same rights, powers, obligations, duties and immunities as if it had been
originally named as Rights Agent without further act or deed; but the
predecessor Rights Agent shall deliver and transfer to the successor Rights
Agent any property at the time held by it hereunder, and execute and deliver any
further assurance, conveyance, act or deed necessary for the purpose. Not later
than the effective date of any such appointment, the Company shall file notice
thereof in writing with the predecessor Rights Agent and each transfer agent for
the Preferred Shares and for the Common Stock of the Company, and mail notice
thereof to the registered holders of the Rights 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 any successor Rights Agent or the appointment of any successor
thereto.
SECTION 22. ISSUANCE OF NEW RIGHTS CERTIFICATES.
Notwithstanding any provision of this Agreement or of the Rights Certificates to
the contrary, the Company may, at its option, issue new Rights Certificates
evidencing the Rights in such form as may be approved by the Board to reflect
any adjustment or change in the Exercise Price or in the number or kind of
shares, securities or other property issuable upon exercise of the Rights in
accordance with the provisions of this Agreement; PROVIDED, HOWEVER, that (a) no
such Rights Certificates shall be issued if, and to the extent that, the Company
shall be advised by counsel that such issuance could create a significant risk
of material adverse tax consequences to the Company or to the Persons to whom
such Rights Certificates would be issued and (b) no such Rights Certificates
shall be issued if, and to the extent that, appropriate adjustment shall
otherwise have been made in lieu of the issuance thereof.
SECTION 23. REDEMPTION.
(a) The Board may, at its option, at any time prior to the
earliest of (i) the Close of Business on the 10th Business Day after the Share
Acquisition Date (or, if the Share Acquisition Date shall have occurred prior to
the Record Date, the Close of
-33-
Business on the 10th Business Day after the Record Date), (ii) the occurrence of
any Section 13 Event and (iii) the Final Expiration Date, redeem all, but not
less than all, of the then outstanding Rights at a redemption price of $.01 per
Right, adjusted as provided in subsection (g) of this Section 23 (such
redemption price being hereinafter called the "Redemption Price"); PROVIDED,
HOWEVER, that if the Board shall authorize the redemption of the Rights in the
circumstances set forth in either clause (A) or (B) below, there must be
Disinterested Directors then in office and such authorization shall require the
concurrence of at least a majority of such Disinterested Directors: (A) such
authorization shall occur on or after the date a Person becomes an Acquiring
Person or (B) such authorization shall occur on or after the date of a change
(resulting from a solicitation of either proxies or one or more written
stockholder consents) in a majority of the directors in office at the
commencement of such solicitation if any Person who shall be a participant in
such solicitation has stated (or, if upon the commencement of such solicitation,
at least a majority of the Disinterested Directors shall have determined in good
faith) that such Person (or any of its Affiliates or Associates) intends to
take, or may consider taking, any action which would result in such Person
becoming an Acquiring Person or which would cause the occurrence of a Triggering
Event.
(b) In addition to the right of redemption reserved in the
first sentence of subsection (a) of this Section 23, if there shall be
Disinterested Directors then in office, the Board may redeem, with the
concurrence of at least a majority of the Disinterested Directors, all, but not
less than all, of the then outstanding Rights at the Redemption Price after the
Share Acquisition Date, but prior to the occurrence of any Section 13 Event, if
either (i) the Person who is an Acquiring Person shall have transferred or
otherwise disposed of (either alone or together with its Affiliates and
Associates) such number of shares of Common Stock of the Company, in one or a
series of related transactions not directly or indirectly involving the Company
or any of its Subsidiaries or the occurrence of any Section 13 Event, as shall
result in such Person thereafter being a Beneficial Owner of less than 10% of
the then outstanding shares of Common Stock of the Company, and after such
transfer or other disposition there is no other Acquiring Person, or (ii) in
connection with any Section 13 Event which shall not involve an Interested
Stockholder and in which all holders of the Common Stock of the Company are
treated the same.
(c) Notwithstanding any other provision of this Agreement, the
Rights shall not be exercisable after the first occurrence of any Section
11(a)(ii) Event until such time as the Company's right of redemption under this
Section 23 shall have expired.
(d) In considering whether to redeem the Rights, the Board and
the Disinterested Directors may consider the best long-term and short-term
interests of the Company and its stockholders, including, without limitation,
the effects of the redemption of the Rights upon employees, creditors, suppliers
and customers of the Company or of its Subsidiaries and upon the communities in
which offices or other establishments of the Company and such Subsidiaries are
located and all other pertinent factors. The redemption of the Rights by the
Board may be made effective at
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such time, on such basis and with such conditions as the Board, in its sole
discretion, may establish.
(e) Immediately after action by the Board directing the
redemption of the Rights pursuant to subsection (a) or (b) of this
Section 23, and without any further action and without any notice, the right to
exercise the Rights shall terminate, and thereafter each registered holder of
the Rights shall only be entitled to receive the Redemption Price therefor. The
Company shall give prompt written notice to the Rights Agent and prompt public
notice to the holders of the Rights of any such redemption; PROVIDED, HOWEVER,
that the failure to give, or any defect in, any such notice shall not affect the
validity of such redemption. Within 10 days after action by the Board directing
the redemption of the Rights, the Company shall mail (or cause the Rights Agent
to mail) a notice of redemption to each registered holder of the then
outstanding Rights, at its last address appearing on the registry books of the
Rights Agent or, prior to the Distribution Date, on the registry books of the
transfer agent for the Common Stock of the Company. Any notice which is mailed
in the manner provided in this subsection (e) shall be deemed given, whether or
not received by the registered holder to whom sent. Each notice of redemption
shall state the method by which payment of the Redemption Price is to be made.
Neither the Company nor any of its Affiliates or Associates may at any time
redeem, acquire or purchase for value any Rights other than in the manner set
forth in this Section 23 and Section 24 or in connection with any purchase of
outstanding shares of its Common Stock prior to the Distribution Date.
(f) The Company may, at its option, pay the Redemption Price
in cash, shares of Common Stock (based on its Fair Market Value (determined as
provided in Section 11(d)) as of the date of redemption) or any other form of
consideration deemed appropriate by the Board.
(g) In the event that the Company shall at any time after the
date of this Agreement (i) declare a dividend on its outstanding shares of
Common Stock payable in shares of Common Stock or (ii) effect a subdivision,
combination or consolidation of its outstanding shares of Common Stock (by
reclassification or otherwise than by payment of dividends in shares of Common
Stock) into a greater or lesser number of shares of Common Stock, then, in each
such case, the Redemption Price after such event shall equal the Redemption
Price in effect immediately prior to such event multiplied by a fraction, the
numerator of which shall be the number of shares of Common Stock outstanding
immediately prior to such event and the denominator of which shall be the number
of shares of Common Stock outstanding immediately after such event; PROVIDED,
HOWEVER, that such adjustment shall be made only if the amount of the Redemption
Price would be reduced or increased by at least $.001 per Right.
SECTION 24. EXCHANGE.
(a) The Board may, at its option, at any time on or after the
occurrence of any Section 11(a)(ii) Event, exchange all or any part of the then
outstanding and
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exercisable Rights (which shall not include any Rights which have become
void pursuant to Section 7(d)) for shares of Common Stock of the Company at an
exchange rate of one share of Common Stock per Right, appropriately adjusted to
reflect any event specified in clauses (A) through (D), inclusive, of the first
sentence of Section 11(a)(i) or in Section 11(n) occurring after the date hereof
(such exchange rate being hereinafter called the "Exchange Rate"); PROVIDED,
HOWEVER, that the Board shall not be authorized to effect such an exchange at
any time after any Person (other than an Exempt Person), together with the
Affiliates and Associates of such Person, shall have become the Beneficial Owner
of 50% or more of the then outstanding shares of Common Stock of the Company.
(b) Immediately after action by the Board directing the
exchange of any Rights pursuant to subsection (a) of this Section 24, and
without any further action and without any notice, the right to exercise such
Rights shall terminate, and thereafter each registered holder of such Rights
shall only be entitled to receive the number of shares of Common Stock of the
Company which shall equal the number of such Rights held by such registered
holder multiplied by the Exchange Rate then in effect. The Company shall give
prompt written notice to the Rights Agent and prompt public notice to the
holders of the Rights of any such exchange; PROVIDED, HOWEVER, that the failure
to give, or any defect in, any such notice shall not affect the validity of such
exchange. Within 10 days after action by the Board directing the exchange of any
Rights, the Company shall mail (or cause the Rights Agent to mail) a notice of
exchange to each registered holder of such Rights, at its last address appearing
on the registry books of the Rights Agent or, prior to the Distribution Date, on
the registry books of the transfer agent for the Common Stock of the Company.
Any notice which is mailed in the manner provided in this subsection (b) shall
be deemed given, whether or not received by the registered holder to whom sent.
Each notice of exchange shall state the method by which the exchange of shares
of Common Stock for Rights will be effected and, in the event of any partial
exchange, the number of Rights which will be exchanged. Any partial exchange
shall be effected pro rata among the registered holders of the Rights based upon
the number of Rights held (excluding Rights which shall have become void
pursuant to Section 7(d)); and, in such case, a new Rights Certificate
evidencing the Rights not being exchanged shall be prepared and executed by the
Company and countersigned and delivered by the Rights Agent to the registered
holder of such Rights.
(c) In any exchange pursuant to this Section 24, the Company,
at its option, may substitute Preferred Shares (or Equivalent Preferred Shares)
for shares of Common Stock in effecting an exchange for Rights, at the initial
rate of one one-hundredth of a Preferred Share (or Equivalent Preferred Share)
for each share of Common Stock, appropriately adjusted to reflect any
adjustments in the voting rights of the Preferred Shares pursuant to the
Certificate of Designations attached hereto as Exhibit A, so that the fractional
Preferred Share delivered in lieu of each share of Common Stock shall have the
same voting rights as one share of Common Stock.
-36-
(d) In the event that there shall not be sufficient authorized
and unissued or treasury shares of Common Stock or Preferred Shares (or
Equivalent Preferred Shares) to permit the exchange of Rights directed by the
Board, the Company shall take all necessary action to authorize and reserve for
issuance such number of additional shares of Common Stock or Preferred Shares
(or Equivalent Preferred Shares) as may be required for issuance upon such
exchange and, if necessary, shall use its best efforts to obtain stockholder
approval thereof.
(e) The Company shall not be required to issue fractional
shares of Common Stock in exchange for Rights or to distribute stock
certificates which evidence fractional shares of Common Stock. If the Company
shall determine not to issue fractional shares of Common Stock, the Company
shall pay to the registered holders of the Rights with respect to which such
fractional shares would otherwise be issuable an amount in cash equal to the
same fraction of the Fair Market Value (determined as provided in Section 11(d)
for the Trading Day immediately prior to the date of such exchange) of one share
of Common Stock.
SECTION 25. NOTICE TO HOLDERS OF RIGHTS CERTIFICATES OF
CERTAIN EVENTS.
(a) In the event that at any time after the Distribution Date,
the Company shall propose: (i) to pay any dividend payable in shares of capital
stock of any class of the Company to the holders of Preferred Shares or to make
any other cash distribution to the holders of Preferred Shares (other than a
regular quarterly cash dividend); (ii) to effect any reclassification of the
Preferred Shares (other than a reclassification involving only the subdivision
of the outstanding Preferred Shares); (iii) to make any distribution to the
holders of Preferred Shares described in subsection (b) or (c) of Section 11;
(iv) to effect any Section 13 Event; (v) to pay any dividend on its shares of
Common Stock payable in shares of Common Stock or to effect a subdivision,
combination or consolidation of its outstanding shares of Common Stock (by
reclassification or otherwise than by payment of dividends in shares of Common
Stock); or (vi) to effect the liquidation, dissolution or winding up of the
Company; then, in each such case, the Company shall give to the Rights Agent and
each registered holder of the Rights, in the manner provided in Section 26,
written notice of such proposed action, which shall specify the record date for
such stock dividend or distribution or the date on which such reclassification,
Section 13 Event, liquidation, dissolution or winding up is expected to occur
(and the date for participation therein by the holders of the Common Stock
and/or Preferred Shares if any such date is to be fixed). Such notice shall be
given, in the case of any action described in clause (i) or (iii) of the
preceding sentence, at least 10 days prior to the record date and, in the case
of any other such action, at least 20 days prior to the date of taking of such
proposed action or the date for participation therein by the holders of
Preferred Shares, whichever shall be the earlier.
(b) In case any Section 11(a)(ii) Event shall occur, the
Company shall, as soon as practicable thereafter, give to the Rights Agent and
each registered holder
-37-
of the Rights, in the manner provided in Section 26, written notice of the
occurrence thereof, which notice shall describe such occurrence and its
consequences in reasonable detail.
SECTION 26. OTHER NOTICES. Except as otherwise provided
herein, notices or demands authorized by this Agreement to be given or made by
the Rights Agent or by the registered holder of any Rights, Rights Certificate
or stock certificate for shares of Common Stock of the Company to or on the
Company shall be sufficiently given or made if sent by first-class mail, postage
prepaid, addressed (until another address shall be filed in writing with the
Rights Agent) as follows:
First Commonwealth, Inc.
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
Attention: President
Except as otherwise provided herein, notices or demands
authorized by this Agreement to be given or made by the Company or by the
registered holder of any Rights, Rights Certificate or stock certificate for
shares of Common Stock of the Company to or on the Rights Agent shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed (until another address shall be filed in writing with the Company) as
follows:
First Chicago Trust Company of New York
000 Xxxxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxxx Xxxx, Xxx Xxxxxx 00000
Attention: Tenders and Exchanges Administration
Except as otherwise provided herein, notices or demands
authorized by this Agreement to be given or made by the Company or the Rights
Agent to the registered holder of any Rights, Rights Certificate or stock
certificate for shares of Common Stock of the Company shall be sufficiently
given or made if sent by first-class mail, postage prepaid, addressed to such
holder at its last address appearing on the registry books of the Rights Agent
or, prior to the Distribution Date, on the registry books of the transfer agent
for the Common Stock of the Company.
SECTION 27. SUPPLEMENTS AND AMENDMENTS. Prior to the
Distribution Date, but subject to the last sentence of this Section 27, the
Company and the Rights Agent, if so directed in writing by the Company, shall
supplement or amend any term, provision or condition of this Agreement, without
the approval of the registered holders of the stock certificates representing
the Common Stock and the Rights. From and after the Distribution Date, but
subject to the last sentence of this Section 27, the Company and the Rights
Agent, if so directed in writing by the Company, shall supplement or amend this
Agreement, without the approval of the registered holders of the Rights (however
represented), in order: (a) to cure any ambiguity, (b) to correct or supplement
any term, provision or condition of this Agreement which may be defective
-38-
or inconsistent with any other term, provision or condition hereof, (c) to
shorten or lengthen any time period specified herein (except that after the
first occurrence of an event described in either clause (A) or (B) of the
proviso in the first sentence of Section 23(a), there must be Disinterested
Directors then in office and any such shortening or lengthening shall require
the concurrence of at least a majority of such Disinterested Directors) or (d)
to change or supplement one or more of the terms, provisions or conditions
hereof in any manner which the Company may deem necessary or desirable and which
shall not adversely affect, as determined by the Board (with the concurrence of
at least a majority of the Disinterested Directors), the interests of the
holders (other than any Restricted Person or the transferees therefrom specified
in Section 7(d) of the Rights (however represented); PROVIDED, HOWEVER, that
this Agreement may not be supplemented or amended pursuant to clause (c) of this
sentence (i) to lengthen any time period (except as permitted by Section
3(a)(ii)) unless (A) approved by at least a majority of the Disinterested
Directors and (B) such lengthening is for the purpose of protecting, enhancing
or clarifying the rights of, and/or the benefits to, the holders (other than any
Restricted Person or the transferees therefrom specified in Section 7(d)) of the
Rights or (ii) to lengthen any time period relating to when the Rights may be
redeemed if at such time the Rights are not then redeemable. Upon the delivery
of a certificate from an appropriate officer of the Company stating that the
proposed supplement or amendment is in compliance with the terms of this Section
27, the Rights Agent shall execute such supplement or amendment; PROVIDED,
HOWEVER, that the Rights Agent shall not be required to execute any supplement
or amendment which affects any of the Rights Agent's rights, powers,
obligations, duties or immunities under this Agreement without its consent. On
and after the Distribution Date, no supplement or amendment shall be made which
changes the Exercise Price, the number of one one-hundredths of a Preferred
Share for which a Right is exercisable, the Redemption Price or the Final
Expiration Date. Prior to the Distribution Date, the interests of the holders of
the Rights shall be deemed coincident with the interests of the holders of the
Common Stock of the Company.
SECTION 28. SUCCESSORS. All of the terms, provisions
and conditions of this Agreement by or for the benefit of the
Company or the Rights Agent shall bind and inure to the benefit of
their respective successors and assigns.
SECTION 29. CERTAIN DETERMINATIONS AND ACTIONS BY THE BOARD.
For all purposes of this Agreement, any calculation of the number of shares of
Common Stock outstanding at any particular time, including the determination of
the percentage of such outstanding shares of which any Person is the Beneficial
Owner, shall be made in accordance with the last sentence of Rule
13d-3(d)(1)(i), as in effect on the date hereof, under the Exchange Act. The
Board (or, as and when set forth herein, the Disinterested Directors) shall have
the exclusive power and authority to interpret this Agreement and to exercise
all rights and powers specifically granted to the Board or to the Company, or as
may be necessary or advisable in the administration of this Agreement,
including, without limitation, the right and power to make all determinations
deemed necessary or advisable for such administration, including, without
limitation, a
-39-
determination to redeem or not to redeem the Rights, to exchange or not to
exchange the Rights or to supplement or amend this Agreement. All such
calculations, determinations, interpretations and exercises (including, for
purposes of clause (b) below, all omissions with respect to the foregoing) which
are done or made by the Board (or the Disinterested Directors) in good faith
shall (a) be final, conclusive and binding on the Company, the Rights Agent, the
holders of the Rights and all other Persons and (b) not subject any director
(including any Disinterested Director) to any liability to the holders of the
Rights or to any other Person.
SECTION 30. BENEFITS OF THIS AGREEMENT. Nothing in this
Agreement shall be construed to give to any Person other than the Company, the
Rights Agent and the registered holders of the Rights Certificates (and, prior
to the Distribution Date, the registered holders of the stock certificates for
the Common Stock of the Company) any legal or equitable right, remedy or claim
under this Agreement; but this Agreement shall be for the sole and exclusive
benefit of the Company, the Rights Agent and the registered holders of the
Rights Certificates (and, prior to the Distribution Date, the registered holders
of the stock certificates for the Common Stock of the Company).
SECTION 31. SEVERABILITY. If any term, provision or condition
of this Agreement shall be held by a court of competent jurisdiction or other
lawful authority to be invalid, void or unenforceable, the remaining terms,
provisions, and conditions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated; PROVIDED,
HOWEVER, that if any such term, provision or condition is held by such court or
authority to be invalid, void or unenforceable and the Board (with the
concurrence of at least a majority of the Disinterested Directors then in
office) shall determine in good faith that severing the same from this Agreement
would adversely affect the purposes or effect of this Agreement, the right of
redemption set forth in Section 23 shall be reinstated and shall not expire
until the Close of Business on the 10th day following the date of such
determination by the Board.
SECTION 32. GOVERNING LAW. This Agreement and each Rights
Certificate issued hereunder shall be deemed to be a contract made under the
laws of the State of Delaware and for all purposes shall be governed by and
construed in accordance with the laws of such State applicable to contracts made
and to be performed entirely within such State.
SECTION 33. COUNTERPARTS. This Agreement may be
executed in any number of counterparts, each of which shall for all
purposes be deemed to be an original, but all such counterparts
shall together constitute one and the same instrument.
SECTION 34. 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.
-40-
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
FIRST COMMONWEALTH, INC.
By: /s/ XXXXXXXXXXX X. XXXXXXXX
----------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Chairman of the Board
ATTEST:
By: /s/ XXXXX X. XXXXXXXX
----------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Secretary
FIRST CHICAGO TRUST COMPANY OF
NEW YORK
By: /s/ XXXXXX XXXXXXXXXX
------------------------------
(Corporate Seal) Name: Xxxxxx Xxxxxxxxxx
Title: Assistant Vice President
Attest:
By: /s/ XXXXXX XXXXXX
--------------------------
Name: Xxxxxx Xxxxxx
Title: Assistant Vice President
-41-
EXHIBIT A
FORM OF
CERTIFICATE OF DESIGNATIONS
OF
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
OF
FIRST COMMONWEALTH, INC.
(Pursuant to Section 151 of the
General Corporation Law of the State of Delaware)
-------------------------------
First Commonwealth, Inc., a corporation organized and existing
under the General Corporation Law of the State of Delaware (the "Corporation"),
does hereby certify that, pursuant to authority conferred upon its Board of
Directors by its Certificate of Incorporation, as amended, and by the provisions
of Section 151 of the General Corporation Law of the State of Delaware, the
following resolution was adopted by its Board of Directors at a meeting duly
called and held on October 20, 1995:
RESOLVED, that, pursuant to the authority conferred upon the
Board of Directors of the Corporation (the "Board") by the provisions of the
Certificate of Incorporation, as amended, of the Corporation and by the
provisions of Section 151 of the General Corporation Law of the State of
Delaware, there is hereby created a series of Preferred Stock of the
Corporation, which series shall have the following powers, designations,
preferences and relative, participating, optional and other special rights, and
the qualifications, limitations or restrictions thereof, in addition to those
set forth in the Certificate of Incorporation, as amended, of the Corporation:
Section 1. DESIGNATION OF SERIES; NUMBER OF SHARES. The
series of Preferred Stock established hereby shall be designated
the "Series A Junior Participating Preferred Stock" (the "Series A
Preferred Stock") and the authorized number of shares constituting
the Series A Preferred Stock shall be 150,000. Such number of
authorized shares may be increased or decreased, from time to time,
by resolution of the Board; PROVIDED, HOWEVER, that no such
decrease shall reduce the number of authorized shares of the Series
A Preferred Stock to a number less than the number of shares of the
Series A Preferred Stock then outstanding, plus the number of
shares of the Series A Preferred Stock then reserved for issuance
upon the exercise of any outstanding options, warrants or rights or
the exercise of any conversion or exchange privilege contained in
any outstanding security issued by the Corporation.
Section 2. DIVIDENDS AND DISTRIBUTIONS.
(a) Subject to the rights of the holders of shares of any
other series of the Preferred Stock (or shares of any other class of capital
stock of the Corporation) ranking senior to the Series A Preferred Stock with
respect to dividends, the holders of shares of the Series A Preferred Stock, in
preference to the holders of shares of Common Stock and of any other class of
capital stock of the Corporation ranking junior to the Series A Preferred Stock
with respect to dividends, shall be entitled to receive, when, as and if
declared by the Board out of funds legally available therefor, quarterly
dividends payable in cash on the first day of March, June, September, and
December in each year (each such date being a "Dividend Payment Date"),
commencing on the first Dividend Payment Date after the initial issuance of a
share or fractional share of the Series A Preferred Stock, in an amount per
share (rounded to the nearest whole cent) equal to 100 times the aggregate per
share amount of all cash dividends, plus 100 times the aggregate per share
amount (payable in kind) of all non-cash dividends or other distributions (other
than a dividend payable in shares of Common Stock or a distribution in
connection with the subdivision of the outstanding shares of Common Stock, by
reclassification or otherwise), declared on the Common Stock since the
immediately preceding Dividend Payment Date or, with respect to the first
Dividend Payment Date, since the initial issuance of a share or fractional share
of the Series A Preferred Stock. The multiple of 100 (the "Dividend Multiple")
set forth in the preceding sentence shall be adjusted from time to time as
hereinafter provided in this paragraph (a). In the event that the Corporation
shall at any time after the effective date of this Certificate of Designations
(i) declare or pay any dividend on the Common Stock payable in shares of Common
Stock or (ii) effect a subdivision, combination or consolidation of the
outstanding shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or lesser number
of shares of Common Stock, then, in each such case, the Dividend Multiple
thereafter applicable to the determination of the amount of dividends per share
which the holders of shares of the Series A Preferred Stock shall be entitled to
receive shall be the Dividend Multiple in effect immediately prior to such event
multiplied by a fraction, the numerator of which shall be the number of shares
of Common Stock outstanding immediately after such event and the denominator of
which shall be the number of shares of Common Stock that were outstanding
immediately prior to such event.
(b) The Board shall declare, out of funds legally available
therefor, a dividend or distribution on the Series A Preferred Stock, as
provided in paragraph (a) of this Section 2, immediately after it has declared a
dividend or distribution on the Common Stock (other than a dividend payable in
shares of Common Stock).
(c) Dividends shall begin to accrue and be cumulative on the
outstanding shares of the Series A Preferred Stock from the Dividend Payment
Date next preceding the date of issuance of such shares, unless such date of
issuance shall be prior to the record date for the first Dividend Payment Date,
in which case dividends on such shares shall begin to accrue and be cumulative
from the date of issuance of such shares, or unless such date of issuance shall
be after the close of business on the record date with respect to any Dividend
Payment Date and on or prior to such
Dividend Payment Date, in which case dividends on such shares shall begin to
accrue and be cumulative from such Dividend Payment Date. Accrued but unpaid
dividends shall not bear interest. Dividends paid on shares of the Series A
Preferred Stock in an amount less than the total amount of dividends then
accrued shall be allocated pro rata among such shares. The Board may fix a
record date for the determination of the holders of shares of the Series A
Preferred Stock entitled to receive payment of any dividend or distribution
declared thereon, which record date shall be not more than the number of days
prior to the date fixed for such payment permitted by applicable law.
Section 3. VOTING RIGHTS. In addition to any other voting
rights required by applicable law, the holders of shares of the Series A
Preferred Stock shall have the following voting rights:
(a) Each share of the Series A Preferred Stock shall entitle
the holder thereof to 100 votes on all matters submitted to a vote of the
stockholders of the Corporation. The multiple of 100 (the "Voting Multiple") set
forth in the preceding sentence shall be adjusted from time to time as
hereinafter provided in this paragraph (a). In the event that the Corporation
shall at any time after the effective date of this Certificate of Designations
(i) declare or pay any dividend on the Common Stock payable in shares of Common
Stock or (ii) effect a subdivision, combination or consolidation of the
outstanding shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or lesser number
of shares of Common Stock, then, in each such case, the Voting Multiple
thereafter applicable to the determination of the number of votes per share to
which the holders of shares of the Series A Preferred Stock shall be entitled
shall be the Voting Multiple in effect immediately prior to such event
multiplied by a fraction, the numerator of which shall be the number of shares
of Common Stock outstanding immediately after such event and the denominator of
which shall be the number of shares of Common Stock that were outstanding
immediately prior to such event.
(b) Except as otherwise provided in this Certificate of
Designations, in any other Certificate of Designations establishing another
series of the Preferred Stock (or any series of any other class of capital stock
of the Corporation) or by applicable law, the holders of the Series A Preferred
Stock, the holders of the Common Stock and the holders of any other class of
capital stock of the Corporation having general voting rights shall vote
together as a single class on all matters submitted to a vote of the
stockholders of the Corporation.
(c) Except as otherwise provided in this Certificate of
Designations or by applicable law, the holders of the Series A Preferred Stock
shall have no special voting rights and their consent shall not be required
(except to the extent provided in paragraph (b) of this Section 3) for the
taking of any corporate action.
Section 4. CERTAIN RESTRICTIONS.
(a) Whenever dividends or other distributions payable on the
Series A Preferred Stock as provided in Section 2 are in arrears, thereafter and
until all accrued and unpaid dividends and distributions, whether or not
declared, on outstanding shares
of the Series A Preferred Stock shall have been paid in full, the Corporation
shall not:
(i) declare or pay dividends, or make any other distributions,
on any shares of any class of capital stock of the Corporation ranking
junior (either as to dividends or upon liquidation, dissolution or
winding up of the Corporation) to the Series A Preferred Stock;
(ii) declare or pay dividends, or make any other distributions, on
any shares of any class of capital stock of the Corporation ranking on
a parity (either as to dividends or upon liquidation, dissolution or
winding up of the Corporation) with the Series A Preferred Stock,
except dividends paid ratably on the Series A Preferred Stock and all
such parity stock on which dividends are accrued and unpaid in
proportion to the total amounts to which the holders of all such shares
are then entitled;
(iii) redeem, purchase or otherwise acquire for consideration any
shares of any class of capital stock of the Corporation ranking junior
(either as to dividends or upon liquidation, dissolution or winding up
of the Corporation) to the Series A Preferred Stock, except that the
Corporation may at any time redeem, purchase or otherwise acquire any
shares of such junior stock in exchange for other shares of any class
of capital stock of the Corporation ranking junior (both as to
dividends and upon dissolution, liquidation or winding up of the
Corporation) to the Series A Preferred Stock; or
(iv) purchase or otherwise acquire for consideration any shares of
the Series A Preferred Stock or any shares of any class of capital
stock of the Corporation ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up of the Corporation) with
the Series A Preferred Stock, or redeem any shares of such parity
stock, except in accordance with a purchase offer made in writing or
by publication (as determined by the Board) to the holders of all such
shares upon such terms and conditions as the Board, after taking into
consideration the respective annual dividend rates and the other
relative powers, preferences and rights of the respective series and
classes of such shares, shall determine in good faith will result in
fair and equitable treatment among the respective holders of shares of
all such series and classes.
(b) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any shares of any
class 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. REACQUIRED SHARES. Any shares of the Series A
Preferred Stock purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and canceled promptly after such purchase or
acquisition. All such canceled shares shall thereupon become authorized and
unissued shares of Preferred Stock and may be reissued as part of any new series
of the Preferred Stock, subject to the conditions and restrictions on issuance
set forth in the Certificate of Incorporation of the Corporation, as amended
from time to time, in any other Certificate of Designations
establishing another series of the Preferred Stock (or any series of any other
class of capital stock of the Corporation) or in any applicable law.
Section 6. LIQUIDATION, DISSOLUTION OR WINDING UP. Upon
any liquidation (whether voluntary or otherwise), dissolution or winding up of
the Corporation, no distribution shall be made (a) to the holders of shares of
any class of capital stock of the Corporation ranking junior (either as to
dividends or upon liquidation, dissolution or winding up of the Corporation) to
the Series A Preferred Stock unless, prior thereto, the holder of each
outstanding share of the Series A Preferred Stock shall have received an amount
equal to the accrued and unpaid dividends and distributions thereon, whether or
not declared, to the date of such payment, plus an amount equal to an aggregate
amount, subject to adjustment as hereinafter provided in this Section 6, equal
to 100 times the aggregate per share amount to be distributed to the holders of
the Common Stock or (b) to the holders of shares of any class of capital stock
of the Corporation ranking on a parity (either as to dividends or upon
liquidation, dissolution or winding up of the Corporation) with the Series A
Preferred Stock, except distributions made ratably on the Series A Preferred
Stock and all such parity stock in proportion to the total amounts to which the
holders of all such shares are entitled upon such liquidation, dissolution or
winding up. In the event that the Corporation shall at any time after the
effective date of this Certificate of Designations (a) declare or pay any
dividend on the Common Stock payable in shares of Common Stock or (b) effect a
subdivision, combination or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise than by payment of a dividend in shares
of Common Stock) into a greater or lesser number of shares of Common Stock,
then, in each such case, the aggregate amount per share which the holders of
shares of the Series A Preferred Stock shall thereafter be entitled to receive
pursuant to clause (a)(ii) of the preceding sentence shall be the aggregate
amount per share in effect pursuant to such clause immediately prior to such
event multiplied by a fraction, the numerator of which shall be the number of
shares of Common Stock outstanding immediately after such event and the
denominator of which shall be the number of shares of Common Stock that were
outstanding immediately prior to such event.
Section 7. CONSOLIDATION, MERGER, ETC. In the event that the
Corporation shall be a party to any consolidation, merger, combination or other
transaction in which the outstanding shares of Common Stock are converted or
changed into or exchanged for other capital stock, securities, cash or other
property, or any combination thereof, then, in each such case, each share of the
Series A Preferred Stock shall at the same time be similarly converted or
changed into or exchanged for an aggregate amount, subject to adjustment as
hereinafter provided in this Section 7, equal to 100 times the aggregate amount
of capital stock, securities, cash and/or other property (payable in kind), as
the case may be, into which or for which each share of Common Stock is being
converted or changed or exchanged. In the event that the Corporation shall at
any time after the effective date of this Certificate of Designations (a)
declare or pay any dividend on the Common Stock payable in shares of Common
Stock or (ii) effect a subdivision, combination or consolidation of the
outstanding shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or lesser number
of shares of Common Stock, then, in each such case, the aggregate amount per
share which the holders of shares of the Series A
Preferred Stock shall thereafter be entitled to receive pursuant to the
preceding sentence shall be the aggregate amount per share in effect pursuant to
such sentence immediately prior to such event multiplied by a fraction, the
numerator of which shall be the number of shares of Common Stock outstanding
immediately after such event and the denominator of which shall be the number of
shares of Common Stock that were outstanding immediately prior to such event.
Section 8. NO REDEMPTION. The shares of the Series A
Preferred Stock shall not be redeemable at any time.
Section 9. RANK. Unless otherwise provided in the
Certificate of Designations establishing another series of the Preferred Stock
after the effective date of this Certificate of Designations, the Series A
Preferred Stock shall rank, as to the payment of dividends and the making of any
other distribution of assets of the Corporation, senior to the Common Stock, but
junior to all other series of the Preferred Stock.
Section 10. AMENDMENTS. The Certificate of Incorporation of
the Corporation shall not be amended in any manner which would materially alter
or change the powers, preferences and rights of the Series A Preferred Stock so
as to adversely affect any thereof without the affirmative vote of the holders
of at least two-thirds of the outstanding shares of the Series A Preferred
Stock, voting separately as a single class.
Section 11. FRACTIONAL SHARES. Fractional shares of the Series
A Preferred Stock may be issued, but, unless the Board shall otherwise
determine, only in multiples of one one-hundredth of a share. The holder of any
fractional share of the Series A Preferred Stock shall be entitled to receive
dividends, participate in distributions, exercise voting rights and have the
benefit of all other powers, preferences and rights relating to the Series A
Preferred Stock in the same proportion as such fractional share bears to a whole
share.
IN WITNESS WHEREOF, Corporation has caused this Certificate of
Designations to be executed and attested by its duly authorized officers this
__day of____________, 1995.
FIRST COMMONWEALTH, INC.
By:
-----------------------------
(Corporate Seal) Name:
Title:
Attest:
By:
--------------------------------
Name:
Title:
Exhibit B
FORM
OF
RIGHTS CERTIFICATE
CERTIFICATE NO. R- _________ RIGHTS
_______ Aggregate Number of
Shares of Series A Junior
Participated Preferred Stock
Initially
Purchasable
NOT EXERCISABLE AFTER _______________, 2005 OR EARLIER IF
REDEMPTION OR EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO
REDEMPTION, AT THE OPTION OF FIRST COMMONWEALTH, INC., AT $.01
PER RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN THE
STOCKHOLDERS RIGHTS AGREEMENT HEREINAFTER MENTIONED. UNDER
CERTAIN CIRCUMSTANCES DESCRIBED IN SUCH AGREEMENT, RIGHTS
BENEFICIALLY OWNED BY A RESTRICTED PERSON (AS SUCH TERM IS
DEFINED IN SUCH AGREEMENT), OR BY SPECIFIED TRANSFEREES FROM A
RESTRICTED PERSON, SHALL BE OR BECOME VOID.
RIGHTS CERTIFICATE
FIRST COMMONWEALTH, 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, subject to the terms, provisions and
conditions of the Stockholders Rights Agreement dated as of November 1, 1995
(the "Rights Agreement") between First Commonwealth, Inc., a Delaware
corporation (the "Company"), and First Chicago Trust Company of New York (the
"Rights Agent"), to purchase from the Company at any time after the Distribution
Date and prior to the Close of Business on November __, 2005, at the principal
office of the Rights Agent or its successor as Rights Agent, one one-hundredth
of a fully paid and nonassessable share of Series A Junior Participating
Preferred Stock, $.001 par value (the "Preferred Shares"), of the Company at a
price (the "Exercise Price") of $40.00 per one one-hundredth of a Preferred
Share, upon presentation and surrender of this Rights Certificate with the Form
of Election to Purchase and the related Form of Certification of Status duly
executed, together with such signature guarantees and other documentation as the
Rights Agent may reasonably request. The number of Rights evidenced by this
Rights Certificate (as well as the number of one one-hundredths of a Preferred
Share which may be purchased upon the exercise of each Right) set forth above,
and the Exercise Price set forth above, are the numbers and the Exercise Price
as of November 1, 1995, based on the Preferred Shares as constituted on such
date. As provided in the Rights Agreement, such number of Rights (and/or such
number of one one-hundredths of a Preferred Share) and such Exercise Price are
subject to change and adjustment upon the happening of certain events specified
in the Rights Agreement. Capitalized terms not defined herein have the
respective meanings specified in the Rights Agreement.
From and after the first occurrence of any Section 11(a)(ii)
Event, if the Rights evidenced by this Rights Certificate are Beneficially Owned
by (i) a Restricted Person, (ii) a transferee from a Restricted Person who
becomes a transferee after the Acquiring Person becomes such or (iii) under
certain circumstances specified in the Rights Agreement, a transferee from a
Restricted Person who becomes a transferee prior to or concurrently with the
Acquiring Person becoming such, such Rights shall be or become void, and no
holder hereof shall have any rights whatsoever with respect to such Rights.
This Rights Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement, which terms, provisions and
conditions are incorporated herein by reference and made a part hereof, to which
Rights Agreement reference is hereby made for a full description of the rights,
powers, obligations, duties and immunities hereunder of the Company, the Rights
Agent and the holders of the Rights Certificates. Under the circumstances set
forth in the Rights Agreement, the exercisability of the Rights represented
hereby may be temporarily suspended. The Rights Agreement is on file at the
principal office of the Company and at the principal office of the Rights Agent,
and a copy will be provided upon written request to the
Secretary of the Company.
Upon surrender at the principal office of the Rights Agent,
this Rights Certificate, with or without other Rights Certificates, may be
exchanged for one or more Rights Certificates of like tenor and date evidencing
Rights entitling the holder to purchase the same aggregate number of one
one-hundredths of a Preferred Share as the Rights evidenced by the Rights
Certificates so surrendered. If this Rights Certificate shall be exercised in
part, the holder hereof shall be entitled to receive, upon surrender hereof, one
or more Rights Certificates for the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights
evidenced by this Rights Certificate (i) may be redeemed, at the direction of
the Board, at a redemption price (subject to adjustment) of $.01 per Right
(payable in cash, shares of Common Stock of the Company or any other form of
consideration deemed appropriate by the Board) or (ii) under certain
circumstances, may be exchanged, in whole or in part, at the direction of the
Board, for shares of Common Stock of the Company or Preferred Shares at an
exchange rate (subject to adjustment) of one share of Common Stock or one
one-hundredth of a Preferred Share per Right.
No fractional Preferred Share will be issued upon the exercise
of any Rights represented hereby (other than fractions which are a multiple of
one one-hundredth of a Preferred Share), but in lieu thereof a cash payment will
be made as provided in the Rights Agreement.
No holder, as such, of this Rights Certificate shall be
entitled to vote, to receive dividends or other distributions on or to exercise
any preemptive rights with respect to, or shall be deemed for any other purpose
to be the holder of, the Preferred Shares or other shares of capital stock of
any class of the Company which may at any time be issuable upon exercise hereof;
nor shall anything contained herein or in the Rights Agreement be construed to
confer upon the holder hereof, as such, any of the rights of a stockholder of
the Company, or any right to vote for the election of directors or upon any
other matter submitted to stockholders at any meeting thereof, to give or
withhold consent to any corporate action, to receive notice of meetings or other
actions affecting stockholders (except as provided in the Rights Agreement) or
to receive dividends, subscription rights or other distributions, until the
Rights evidenced by this Rights Certificate shall have been exercised, in whole
or in part, in accordance with the provisions of the Rights Agreement.
This Rights Certificate shall not be valid or obligatory for
any purpose until it shall have been countersigned by the Rights Agent.
IN WITNESS WHEREOF, this Rights Certificate has been executed
by the Company by the duly authorized facsimile signature of a proper officer of
the Company and a facsimile of its corporate seal has been imprinted hereon and
duly attested by the duly authorized facsimile signature of a proper officer of
the Company.
Dated as of _______________, ____.
FIRST COMMONWEALTH, INC.
(Corporate Seal) By:
---------------------------------
Name:
Title:
ATTEST:
------------------------------
Name:
Title:
Countersigned:
First Chicago Trust Company of New York,
as Rights Agent
By
--------------------------------------
Authorized Signature
[REVERSE SIDE OF RIGHTS CERTIFICATE]
FORM OF ELECTION TO PURCHASE
(To be executed by the registered holder
if such holder desires to exercise Rights
represented by this Rights Certificate)
To First Commonwealth, Inc.:
The undersigned hereby irrevocably elects to exercise
__________ Rights represented by this Rights Certificate to purchase the
Preferred Shares (or other securities, cash or property) issuable upon the
exercise of such Rights and requests that certificates for such Preferred 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 represented by this Rights
Certificate, a new Rights Certificate for the remaining unexercised Rights shall
be registered in the name of and delivered to:
Please insert social security
or other identifying number: ____________________
----------------------------------------------------------------
(Please print name and address)
----------------------------------------------------------------
Dated: _______________, 19__
---------------------------------------
Signature
Signature Guaranteed: ________________________________
Signatures must be guaranteed by a participant in a
recognized Signature Guaranty Medallion Program.
CERTIFICATION OF STATUS
The undersigned hereby certifies by checking the
appropriate boxes that:
(1) this Rights Certificate
----
---- is
----
---- is not
being exercised by or on behalf of a Person who is or was a
Restricted Person (as such term is defined in the Rights
Agreement); and
(2) after due inquiry and to the best knowledge of the
undersigned, it
----
---- did
----
---- did not
acquire, directly or indirectly, the Rights evidenced by this Rights Certificate
from any Person who is, was or subsequently became a Restricted Person.
---------------------------------------
Signature
Date: _______________, 19__
NOTICE
The signature(s) on the foregoing Form of Election to Purchase
and Certification of Status must correspond to the name written upon the face of
this Rights Certificate in every particular, without alteration or enlargement
or any change whatsoever.
In the event the Certification of Status set forth above is
not completed, the Company will deem the Beneficial Owner of the Rights
represented by this Rights Certificate to be a Restricted Person (as such term
is defined in the Rights Agreement), will not honor the Election to Purchase and
will affix a legend to such effect on this Rights Certificate and on any Rights
Certificates issued in exchange for this Rights Certificate.
[Reverse Side of Rights Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer this Rights Certificate)
FOR VALUE RECEIVED _________________________ hereby
sells, assigns and transfers unto
------------------------------
-------------------------------------------------------------------------------
(Please print name and address of transferee)
this Rights Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint _________________________
Attorney, to transfer the within Rights Certificate on the books of the
within-named Company, with full power of substitution.
Dated: _______________, 19__
---------------------------------------
Signature
Signature Guaranteed: ________________________________
Signatures must be guaranteed by a participant in a recognized
Signature Guaranty Medallion Program.
CERTIFICATION OF STATUS
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) this Rights Certificate
[ ] is
[ ] is not
being sold, assigned or transferred by or on behalf of a Person who
is or was a Restricted Person (as such term is defined in the
Rights Agreement); and
(2) after due inquiry and to the best knowledge
of the undersigned, it
[ ] did
[ ] did not
acquire, directly or indirectly the Rights evidenced by this Rights Certificate
from any Person who is, was or subsequently became a Restricted Person.
---------------------------------------
Signature
Date: _______________, 19__
NOTICE
The signature(s) on the foregoing Form of Assignment and
Certification of Status must correspond to the name written upon the face of
this Rights Certificate in every particular, without alteration or enlargement
or any change whatsoever.
In the event the Certification of Status set forth above is
not completed, the Company will deem the Beneficial Owner of the Rights
represented by this Rights Certificate to be a Restricted Person (as such term
is defined in the Rights Agreement), will not honor the Assignment and will
affix a legend to such effect on this Rights Certificate and any Rights
Certificates issued in exchange for this Rights Certificate.
EXHIBIT C
SUMMARY OF RIGHTS TO PURCHASE
SHARES OF SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
On October 20, 1995, the Board of Directors (the "Board") of
First Commonwealth, Inc., a Delaware corporation (the "Company"), declared a
dividend of one preferred stock purchase right (a "Right") for each outstanding
share of Common Stock, $.001 par value (the "Common Stock"), of the Company. The
dividend is payable on the effective date of the Company's initial public
offering registration statement, file no. 33-97426 (the "Record Date") to the
holders of record of the Common Stock at the Close of Business on such date.
Each Right entitles the holder thereof (except as described below) to purchase
from the Company one one-hundredth of a share of the Series A Junior
Participating Preferred Stock, $.001 par value (the "Preferred Shares"), of the
Company at a price (the "Exercise Price") of $40.00 per one one-hundredth of a
Preferred Share, subject to adjustment. The terms of the Rights are set forth in
the Stockholders Rights Agreement dated as of November 1, 1995 (the "Rights
Agreement") between the Company and First Chicago Trust Company of New York, as
Rights Agent (the "Rights Agent"). Capitalized terms not defined herein have the
respective meanings specified in the Rights Agreement.
DISTRIBUTION DATE; TRANSFER OF RIGHTS
Initially, the Rights associated with the Common Stock
outstanding as of the Record Date will be evidenced solely by the stock
certificates for such Common Stock, with a copy of this Summary of Rights
attached thereto. The Rights will separate from the Common Stock upon the
earliest to occur of (i) 10 Business Days after the first public announcement
that any Person (other than an Exempt Person (as hereinafter defined)) has
become an Acquiring Person (as hereinafter defined) and (ii) 10 Business Days
(or such other Business Day as may be determined by action of the Board prior to
the time that any Person shall become an Acquiring Person (as hereinafter
defined) after the commencement by any Person (other than an Exempt Person) of,
or the first public announcement of its intention to commence, a tender or
exchange offer if, upon the consummation thereof, such Person would be the
Beneficial Owner of 15% or more of the outstanding shares of Common Stock (the
earliest of the dates specified in clauses (i) and (ii) being hereinafter called
the "Distribution Date"). After the Distribution Date, the Rights will be
evidenced solely by separate certificates and will trade independently from the
Common Stock.
An "Acquiring Person" is any Person who or which,
together with its Affiliates and Associates, has acquired 15% or more of the
shares of Common Stock then outstanding, but does not include (i) the Company,
(ii) any Subsidiary of the Company, (iii) any employee benefit plan or other
compensation program or
arrangement of the Company or of any such Subsidiary or (iv) any Person holding
shares of Common Stock for or pursuant to the terms of any such plan, program or
arrangement (the Persons specified in clauses (i) through (iv) being herein
collectively called "Exempt Persons"). Notwithstanding the foregoing, if the
Board of Directors of the Company determines in good faith that a Person who
would otherwise be an "Acquiring Person," has become so inadvertently, and such
Person divests as promptly as practicable a sufficient number of shares of
Common Stock so that such Person would no longer be an "Acquiring Person," then
such Person shall not be deemed to be an "Acquiring Person."
A "Disinterested Director" is (i) any member of the Board who
is not a Restricted Person (as hereinafter defined), or a representative or
nominee of a Restricted Person, and was a member of the Board prior to the date
of the Rights Agreement and (ii) any individual who subsequently becomes a
member of the Board and is not a Restricted Person, or a representative or
nominee of a Restricted Person, and whose nomination for election to the Board
is recommended or approved by a majority of the Disinterested Directors then in
office. A "Restricted Person" is an Acquiring Person or any Affiliate or
Associate thereof.
The Rights Agreement provides that, until the Distribution
Date (or the earlier redemption or expiration of the Rights), the Rights may be
transferred only with the associated shares of Common Stock. Until the
Distribution Date (or the earlier redemption or expiration of the Rights), stock
certificates for Common Stock issued after the Record Date, either upon transfer
of outstanding shares or original issuance of additional shares of Common Stock,
will contain a legend incorporating the Rights Agreement by reference. Until the
Distribution Date (or the earlier redemption or expiration of the Rights), the
surrender for transfer of any stock certificate for shares of Common Stock, with
or without such legend and whether or not a copy of this Summary of Rights is
attached thereto, will also constitute the transfer of the Rights associated
with the shares of Common Stock represented by such stock certificate.
As soon as practicable after the Distribution Date, separate
certificates evidencing the Rights ("Rights Certificates") will be mailed to the
holders of record of the Common Stock as of the Close of Business on the
Distribution Date, which thereafter will constitute the sole evidence of the
Rights. Each share of Common Stock issued by the Company after the Record Date
and prior to the earlier redemption or expiration of the Rights, including any
shares of Common Stock issued by reason of the exercise of any option, warrant,
right (other than the Rights) or conversion or exchange privilege (however
evidenced) issued by the Company prior to the Distribution Date, will be
accompanied by a Right (unless the Board expressly provides to the contrary at
the time of issuance of any such option, warrant, right or privilege), and
Rights Certificates evidencing such Rights will be issued at the same time as
the stock certificates for the associated shares of Common Stock.
The Rights ARE NOT EXERCISABLE until the Distribution Date.
Moreover, the time when the Rights may be exercised is restricted as described
in the next paragraph.
The Rights will expire on the tenth anniversary of the Record Date (the "Final
Expiration Date"), unless the Final Expiration Date is extended or unless the
Rights are earlier redeemed or exchanged by the Company, in each case as
described below.
EXERCISE OF RIGHTS UNDER CERTAIN CIRCUMSTANCES
In the event that any Person becomes an Acquiring Person,
proper provision will be made so that the registered holder of each Right (other
than Rights Beneficially Owned as described in the next sentence) will
thereafter have the right to receive, upon exercise thereof, the number of
shares of Common Stock which, at the time of the occurrence of such event, will
have a market value equal to two times the then current Exercise Price. After
the first occurrence of either of the events described in the preceding
sentence, all Rights which are, or (under certain circumstances specified in the
Rights Agreement) were, Beneficially Owned by a Restricted Person or specified
transferees therefrom will be or become void. Under no circumstances may a Right
be exercised after the occurrence of either such event unless the Company's
right to redeem the Rights (as described below) has expired.
If, on or after the date on which any Person has become an
Acquiring Person, any of the following transactions occur: (i) the Company
merges into or consolidates with an Interested Stockholder (as hereinafter
defined) or, unless all holders of the Company's outstanding shares of Common
Stock are treated the same, another Person (with limited designated exceptions);
(ii) an Interested Stockholder or, unless all holders of the Company's
outstanding shares of Common Stock are treated the same, another Person (with
limited designated exceptions) merges into the Company and either (A) all or
part of the outstanding shares of Common Stock of the Company are converted into
capital stock or other securities of any other Person (or the Company), cash
and/or other property or (B) such shares remain outstanding, unconverted and
unchanged; or (iii) the Company sells or transfers 50% or more of its
consolidated assets or earning power to an Interested Stockholder (as
hereinafter defined) or, unless all holders of the Company's outstanding shares
of Common Stock are treated the same, another Person (with limited designated
exceptions); proper provision will be made so that the registered holder of each
Right (other than Rights which have become void) will thereafter have the
right (the "Flip-Over Right") to receive, upon exercise thereof, the number of
common shares of the acquiror (or of another Person affiliated therewith) which,
at the time of consummation of such transaction, will have a market value equal
to two times the then current Exercise Price. An "Interested Stockholder" is any
Restricted Person or any Affiliate or Associate of any other Person in which
such Restricted Person has an interest, or any Person acting, directly or
indirectly, on behalf of or in concert with any such Restricted Person.
ADJUSTMENTS TO EXERCISE PRICE AND STOCK PURCHASABLE UPON EXERCISE
The Exercise Price payable, the number and kind of shares of
capital stock issuable upon exercise of the Rights and the number of Rights
outstanding are subject to adjustment from time to time to prevent dilution (i)
in the event of a dividend
payable in Preferred Shares on, or a subdivision, combination or
reclassification of, the Preferred Shares, (ii) upon the grant to the holders of
the Preferred Shares of certain options, warrants or rights to subscribe for or
purchase Preferred Shares at a price, or securities convertible into or
exchangeable for Preferred Shares with a conversion or exchange price, less than
the then Fair Market Value of the Preferred Shares or (iii) upon the
distribution to the holders of the Preferred Shares of cash, securities,
evidences of indebtedness or other property (other than a regular quarterly cash
dividend or a dividend payable in Preferred Shares) or options, warrants or
rights (other than those referred to in clause (ii) above).
The number of outstanding Rights and the number of one
one-hundredths of a Preferred Share issuable upon exercise of each Right are
also subject to adjustment in the event of a dividend on the Common Stock
payable in shares of Common Stock or a subdivision, combination or
reclassification of the Common Stock occurring, in any such case, prior to the
Distribution Date.
With certain specified exceptions, no adjustment in the
Exercise Price will be made until the cumulative adjustments required equal at
least 1% of the Exercise Price. The Company is not required to issue fractional
Preferred Shares (other than fractions which are multiples of one one-hundredth
of a Preferred Share), but in lieu thereof the Company would be required to make
a cash payment based on the Fair Market Value of the Preferred Shares on the
trading day immediately preceding the date of exercise.
TERMS OF PREFERRED SHARES
The Preferred Shares receivable upon exercise of the Rights
will not be redeemable. Each Preferred Share will entitle the holder thereof to
receive a preferential quarterly dividend equal to 100 times the aggregate per
share amount of all cash dividends, plus 100 times the aggregate per share
amount (payable in kind) of all non-cash dividends and other distributions
(other than in shares of Common Stock), declared on the Common Stock during such
quarter, adjusted to give effect to any dividend on the Common Stock payable in
shares of Common Stock or any subdivision, combination or reclassification of
the Common Stock (a "Dilution Event"). Each Preferred Share will entitle the
holder thereof to 100 votes on all matters submitted to a vote of the
stockholders of the Company, voting together as a single class with the holders
of the Common Stock and the holders of any other class of capital stock having
general voting rights, adjusted to give effect to any Dilution Event. In the
event of liquidation of the Company, the holder of each Preferred Share will be
entitled to receive a preferential liquidation payment equal to 100 times the
aggregate per share amount to be distributed to the holders of the Common Stock,
adjusted to give effect to any Dilution Event, plus an amount equal to accrued
and unpaid dividends and distributions on such Preferred Share, whether or not
declared, to the date of such payment. In the event of any merger, consolidation
or other transaction in which the outstanding shares of Common Stock of the
Company are exchanged for or converted into other capital stock, securities,
cash and/or other property, each Preferred Share will
be similarly exchanged or converted into 100 times the per share amount
applicable to the Common Stock, adjusted to give effect to any Dilution Event.
Because of the nature of the dividend, voting, liquidation and
other rights accorded to each Preferred Share, the value of the one
one-hundredth of a Preferred Share receivable upon the exercise of each Right
should approximate the value of one share of Common Stock.
REDEMPTION OF RIGHTS
At any time prior to the earliest of (i) 10 Business Days
after the first public announcement that any Person (other than an Exempt
Person) has become an Acquiring Person, (ii) the occurrence of any transaction
which permits the exercise of the Flip-Over Right and (iii) the Final Expiration
Date, the Board may redeem the Rights in whole, but not in part, at the
redemption price of $.01 per Right, adjusted to give effect to any Dilution
Event (the "Redemption Price"); PROVIDED, HOWEVER, that, under certain
circumstances specified in the Rights Agreement, the Rights may not be redeemed
unless there are Disinterested Directors in office and such redemption is
approved by at least a majority of such Disinterested Directors. The redemption
of the Rights may be made effective at such time, on such basis and with such
conditions as the Board, in its sole discretion, may establish. After the
redemption period has expired, the Company's right of redemption may be
reinstated, under the circumstances specified in the Rights Agreement, which
include the concurrence of at least a majority of the Disinterested Directors,
if either (i) the Person who became an Acquiring Person shall reduce, in one or
a series of related transactions not involving the Company or any Subsidiary or
the occurrence of any transaction which permits the exercise of the Flip-Over
Right, its Beneficial Ownership of the outstanding shares of Common Stock to
less than 10% of such outstanding shares or (ii) in connection with any
transaction which permits the exercise of the Flip-Over Right, which does not
involve an Interested Stockholder and in which all holders of the Common Stock
are treated the same. Immediately after action by the Board directing the
redemption of the Rights, the option to exercise the Rights will terminate, and
thereafter each registered holder of the Rights will only be entitled to receive
the Redemption Price therefor.
EXCHANGE OF RIGHTS
At any time after any Person has become an Acquiring Person
and prior to the time that any Person (other than an Exempt Person), together
with its Affiliates and Associates, has become the Beneficial Owner of 50% or
more of the outstanding shares of Common Stock, the Board may direct that all or
any part of the outstanding Rights (other than Rights which have become void) be
exchanged for shares of Common Stock at the exchange rate of one share of Common
Stock (or one one-hundredth of a Preferred Share or of another share of capital
stock of the Company having equivalent rights, preferences and privileges) per
Right, adjusted to give effect to any Dilution Event.
AMENDMENT OF THE RIGHTS AND THE RIGHTS AGREEMENT
Prior to the Distribution Date, the terms of the Rights and
the Rights Agreement may be supplemented or amended by the Board in any manner.
From and after the Distribution Date, the Rights may be supplemented or amended
by the Board, without the approval of the holders of the Rights, in certain
respects which do not adversely affect, as determined by the Board (with the
concurrence of at least a majority of the Disinterested Directors), the
interests of such holders; PROVIDED, HOWEVER, that the Rights Agreement cannot
be amended to lengthen (i) any time period unless (A) such lengthening is
approved by at least a majority of the Disinterested Directors and (B) such
lengthening is for the benefit of the holders of the Rights or (ii) any time
period relating to when the Rights may be redeemed if at such time the Rights
are not then redeemable.
MISCELLANEOUS
Until a Right is exercised, the holder thereof, as such, will
have no rights as a stockholder of the Company, including, without limitation,
the right to vote or to receive dividends.
A copy of the Rights Agreement is available free of charge
from the Company. This summary description of the Rights does not purport to be
complete and is qualified in its entirety by reference to the Rights Agreement,
which is hereby incorporated herein by reference.
