1
XXXX INDUSTRIES, INC.
and
WACHOVIA BANK, N.A.
as
Rights Agent
AMENDED AND RESTATED RIGHTS AGREEMENT
Dated as of April 10, 1999
2
Table of Contents
Section Page
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1. Certain Definitions......................................................................1
2. Appointment of Rights Agent..............................................................6
3. Issue of Rights Certificates.............................................................6
4. Form of Rights Certificates..............................................................8
5. Countersignature and Registration........................................................8
6. Transfer, Split Up, Combination and Exchange of Rights Certificates; Mutilated,
Destroyed, Lost or Stolen Rights Certificates............................................9
7. Exercise of Rights; Purchase Price; Expiration Date of Rights...........................10
8. Cancellation and Destruction of Rights Certificates.....................................11
9. Reservation and Availability of Preferred Stock.........................................12
10. Preferred Stock Record Date..........................................................13
11. Adjustment of Purchase Price, Number and Kind of Shares or Number of
Rights...............................................................................13
12. Certificate of Adjusted Purchase Price or Number of Shares...........................21
13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power.................21
14. Additional Covenants.................................................................24
15. Fractional Rights and Fractional Shares..............................................25
16. Rights of Action.....................................................................26
17. Agreement of Rights Holders..........................................................26
18. Rights Certificate Holder Not Deemed a Stockholder...................................27
19. Concerning the Rights Agent..........................................................27
20. Merger or Consolidation or Change of Name of Rights Agent............................28
21. Duties of Rights Agent...............................................................28
22. Change of Rights Agent...............................................................30
23. Issuance of New Rights Certificates..................................................31
(i)
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24. Redemption and Termination...........................................................31
25. Notice of Certain Events.............................................................33
26. Notices..............................................................................33
27. Supplements and Amendments...........................................................34
28. Determination and Actions by the Board of Directors, etc.............................34
29. Successors...........................................................................35
30. Benefits of this Agreement...........................................................35
31. Severability.........................................................................35
32. Governing Law........................................................................35
33. Counterparts.........................................................................35
34. Descriptive Headings.................................................................35
Exhibit A -- Form of Rights Certificate A-1
Exhibit B -- Form of Summary of Rights B-1
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AMENDED AND RESTATED RIGHTS AGREEMENT
AMENDED AND RESTATED RIGHTS AGREEMENT (this "Agreement"), dated as of
April 10, 1999, between XXXX INDUSTRIES, INC., a Georgia corporation (the
"Company"), and WACHOVIA BANK, N.A, a ________________________ (the "Rights
Agent").
W I T N E S S E T H:
WHEREAS, on March 29, 1989, the Board of Directors of the Company
authorized and declared a dividend distribution of one Right (individually, a
"Right" and collectively, the "Rights") for each share of Common Stock of the
Company outstanding on April 10, 1989 (the "Record Date"), and authorized the
issuance of one Right (subject to adjustment) for each share of Common Stock of
the Company issued thereafter, all subject to the terms and subject to the
conditions set forth in the Rights Agreement dated as of April 10, 1989 (the
"Original Agreement") between the Company and The Citizens and Southern Trust
Company (Georgia), N.A., each Right initially representing the right to
purchase one one-hundredth (1/100th) of a share of Series A Participating
Preferred Stock, $1.00 stated value per share, of the Company (the "Preferred
Stock"), having the rights, powers and preferences set forth in Article II of
the Amended and Restated Articles of Incorporation of the Company (the
"Articles of Incorporation"); and
WHEREAS, the Board of Directors of the Company authorized and approved
the amendments and modifications to the Original Agreement and the Rights
reflected in this Agreement to, among other things, (i) extend the original
final expiration date, (ii) decrease the threshold ownership level for purposes
of the Acquiring Person definition (see paragraph (a) of Section 1 of this
Agreement) and the trigger of certain other rights from 20% to 15%, (iii)
adjust the terms of the Rights so that one full Right will be associated with
each share of Common Stock of the Company as currently constituted and that
each Right will represent the right to purchase one one-hundredth of a share of
Preferred Stock at an exercise price of $100.00, subject to future adjustment as
provided herein, and (iv) provide for the right, at the Company's option, to
exchange Rights for shares of Common Stock of the Company under certain
circumstances, and approved and adopted this Agreement, which amends and
restates the Original Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto hereby agree as follows:
Section 1. Certain Definitions. For purposes of this Agreement,
the following terms have the meanings indicated:
(a) "Acquiring Person" shall mean any Person who or
which, together with all Affiliates and Associates of such Person,
without the prior approval of the Company, shall be the Beneficial
Owner of securities representing 15% or more of the shares of Common
Stock of the Company then outstanding or who or which was such a
Beneficial Owner at any time after the date hereof, whether or not
such Person continues to be the
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Beneficial Owner of securities representing 15% or more of the
outstanding shares of Common Stock, but shall not include (i) any
Person who or which, together with all Affiliates and Associates of
such Person, becomes the Beneficial Owner of securities representing
15% or more of the outstanding shares of Common Stock of the Company
solely as a result of (x) a reduction of the number of outstanding
shares of Common Stock of the Company, including a reduction through
repurchases of outstanding shares of such Common Stock by the Company,
which reduction increases the percentage of outstanding shares of
Common Stock of the Company beneficially owned by such Person, for as
long as such Person and such Person's Affiliates and Associates do not
increase their beneficial ownership by acquiring any additional shares
of Common Stock of the Company following the date on which such
Person, together with such Person's Affiliates and Associates, became
a Beneficial Owner of securities representing 15% or more of the
outstanding shares of Common Stock of the Company or (y) the
acquisition of beneficial ownership of shares of Common Stock of the
Company in the good faith belief that such acquisition would not (1)
cause such beneficial ownership to exceed 15% of the shares of the
Common Stock of the Company then outstanding and such Person relied in
good faith in computing the percentage beneficial ownership on
publicly filed reports or documents of the Company which were
inaccurate or out-of-date or (2) otherwise cause a Distribution Date
or the adjustment provided for in Section 11(a)(ii) to occur, (ii) the
Company, any subsidiary of the Company, any employee benefit plan of
the Company or any of its subsidiaries or any entity holding
securities of the Company organized, appointed or established by the
Company or any of its subsidiaries for or pursuant to the terms of any
such plan, or (iii) any underwriter that becomes beneficial owner of
shares of Common Stock of the Company in connection with an
underwritten offering of securities of the Company. Notwithstanding
clause (i)(y) of the preceding sentence, if any Person who or which is
not an Acquiring Person due to such clause (i)(y) does not reduce such
Person's percentage beneficial ownership of the Common Stock of the
Company to less than 15% by the close of business on the fifth
Business Day after notice from the Company (the date of the notice
being the first day) that such Person's beneficial ownership of shares
of Common Stock or other securities of the Company is or exceeds 15%,
such Person shall, at the end of such five Business Day period, become
an Acquiring Person (and such clause (i)(y) shall no longer apply to
such Person). For purposes of this definition, the determination
whether any Person acted in "good faith" shall be conclusively made by
the Board of Directors of the Company.
(b) "Adjustment Fraction" has the meaning set forth in
Section 11(n).
(c) "Adjustment Shares" has the meaning set forth in Section
11(a)(ii).
(d) "Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the under the
Exchange Act as in effect on the date of this Agreement.
(e) "Agreement" has the meaning set forth in the recital of
parties hereto.
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(f) "Articles of Incorporation" has the meaning set forth in
the first recital to this Agreement.
(g) A Person shall be deemed the "Beneficial Owner" of, and
shall be deemed to "beneficially own," or to have "beneficial
ownership" of, any securities:
(i) which such Person or any of such Person's
Affiliates or Associates, directly or indirectly, has the
right or obligation to acquire (whether such right or
obligation is exercisable or effective immediately or only
after the passage of time or the satisfaction of conditions)
pursuant to any agreement, arrangement or understanding
(whether or not in writing) or upon the exercise of
conversion rights, exchange rights, rights, warrants or
options, or otherwise;
(ii) which such Person or any of such Person's
Affiliates or Associates is considered to be "beneficial
owner" under Rule 13d-3 under the Exchange Act; provided,
however, that a Person shall not be deemed under this
subparagraph (ii) the "Beneficial Owner" of, or to
"beneficially own," or to have "beneficial ownership" of,
securities as a result of any agreement, arrangement or
understanding (whether or not in writing) if such agreement,
arrangement or understanding (A) arises solely from a
revocable proxy given in response to a proxy or consent
solicitation made pursuant to, and in accordance with, the
applicable rules and regulations of the Exchange Act and (B)
is not reportable by such Person on Schedule 13D or Schedule
13G under the Exchange Act (or any comparable or successor
report); or
(iii) which are beneficially owned, directly or
indirectly, by any other Person (or any Affiliate or
Associate thereof) with which such Person or any of such
Person's Affiliates or Associates has any agreement,
arrangement or understanding (whether or not in writing), or
with which such Person or any of such Person's Affiliates or
Associates have otherwise formed a "group" (as such term is
used in Regulation 13D-G under the Exchange Act), for the
purpose of acquiring, holding, voting (except pursuant to a
revocable proxy as described in the proviso of subparagraph
(ii) of this paragraph (g)) or disposing of any securities of
the Company;
provided, however, that under this paragraph (g) a Person shall not be
deemed the "Beneficial Owner" of, or to "beneficially own", or to have
"beneficial ownership" of, (A) securities tendered pursuant to a
tender or exchange offer made in accordance with the applicable rules
and regulations under the Exchange Act by such Person or any of such
Person's Affiliates or Associates until such tendered securities are
accepted for purchase or exchange, or (B) securities that may be
issued upon exercise of Rights acquired by such Person or any of such
Person's Affiliates or Associates prior to the Distribution Date or in
connection with an adjustment made with respect to any such Rights
pursuant to this Agreement.
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(h) "Business Day" shall mean any day other than a
Saturday, Sunday, or a day on which banking institutions in the State
of Georgia are authorized or obligated by law or executive order to
close.
(i) "close of business" on any given date shall mean
4:00 P.M., local Atlanta, Georgia time on such date; provided,
however, that if such date is not a Business Day it shall mean such
time on the next succeeding Business Day.
(j) "Common Stock" shall mean the Common Stock, no par
value per share, of the Company, and when used with reference to
capital stock issued by any Person other than the Company shall mean
the capital stock of such Person with the greatest voting power, or
the equity securities or other equity interest having power to control
or direct the management, of such Person or, if such Person is a
subsidiary of another Person, of the Person which ultimately controls
such subsidiary and which has issued and outstanding such capital
stock, equity securities or equity interests.
(k) "common stock equivalent" has the meaning set forth
in Section 11(a)(iii).
(l) "Company" has the meaning set forth in the recital
of parties to this Agreement.
(m) "current market price" has the meaning set forth in
Section 11(d).
(n) "Current Value" has the meaning set forth in Section
11(a)(iii).
(o) "Distribution Date" has the meaning set forth in
Section 3(a).
(p) "Exchange Act" shall mean the Securities Exchange
Act of 1934, as amended.
(r) "Exchange Ratio" has the meaning set forth in
Section 35(a).
(s) "Expiration Date" has the meaning set forth in
Section 7(a).
(t) "Final Expiration Date" has the meaning set forth in
Section 7(a).
(u) "Original Agreement" has the meaning set forth in
the first recital to this Agreement.
(v) "Permitted Offer" has the meaning set forth in
Section 11(a)(ii).
(x) "Person" shall mean any individual, firm,
corporation, partnership, limited liability company, joint venture,
association, trust, unincorporated organization or other entity.
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(y) "Preferred Stock" has the meaning set forth in the
first recital to this Agreement.
(z) "preferred stock equivalent" has the meaning set
forth in Section 11(b).
(w) "Principal Party" has the meaning set forth in
Section 13(b).
(aa) "Purchase Price" has the meaning set forth in
Section 4(a).
(bb) "Record Date" has the meaning set forth in the first
recital to this Agreement.
(cc) "Redemption Price" has the meaning set forth in
Section 24(a).
(dd) "Right" has the meaning set forth in the first
recital to this Agreement.
(ee) "Rights Agent" has the meaning set forth in the
recital of parties to this Agreement.
(ff) "Rights Certificate" has the meaning set forth in
Section 3(a).
(gg) "Section 11(a)(ii) Event" has the meaning set forth
in Section 11(a)(ii).
(hh) "Section 11(a)(iii) Trigger Date" has the meaning
set forth in Section 11(a)(iii).
(ii) "Securities Act" shall mean the Securities Act of
1933, as amended.
(jj) "Spread" has the meaning set forth in Section 11(a)
(iii).
(kk) "Stock Acquisition Date" shall mean the first date
of public announcement (including, without limitation, the filing of
any report pursuant to Section 13(d) of the Exchange Act) by the
Company or an Acquiring Person that an Acquiring Person has become
such.
(ll) A "subsidiary" of any Person shall mean any
corporation or other entity of which a majority of the voting power of
the voting equity securities or voting interests is owned, directly or
indirectly, by such Person, or which is otherwise controlled by such
Person.
(mm) "Substitution Period" has the meaning set forth in
Section 11(a)(iii).
(nn) "Summary of Rights" has the meaning set forth in
Section 3(a).
(oo) "Trading Day" has the meaning set forth in Section
11(d)(i).
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(pp) "Voting Power" shall mean the voting power of all
securities of the Company then outstanding and generally entitled to
vote for the election of Directors of the Company.
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 (who shall, in accordance with Section 3 hereof, prior to the
Distribution Date, be the holders of the Common Stock of the Company) in
accordance with the terms and conditions hereof, and the Rights Agent hereby
accepts such appointment. The Company may from time to time appoint such
Co-Rights Agents, as it may deem necessary or desirable. In the event the
Company appoints one or more Co-Rights Agents, the respective duties of the
Rights Agent and any Co-Rights Agents shall be as the Company shall determine.
Section 3. Issue of Rights Certificates.
(a) Until the earlier of (i) the close of business on
the tenth Business Day after the Stock Acquisition Date or (ii) the
close of business on the tenth Business Day after the date of the
commencement of, or first public announcement of the intent of any
Person (other than the Company, any subsidiary of the Company, or any
employee benefit plan of the Company or any of its subsidiaries or any
entity holding of securities of the Company organized, appointed or
established by the Company or any of its subsidiaries for or pursuant
to the terms of any such plan) to commence (which intention to
commence remains in effect for five Business Days after such
announcement), a tender or exchange offer which would result in such
Person becoming an Acquiring Person, unless such date under this
clause (ii) is extended by the Board of Directors of the Company prior
to such time as such Person becomes an Acquiring Person (the earlier
of such dates being herein referred to as the "Distribution Date"),
(x) the Rights shall be evidenced (subject to the provisions of
paragraph (b) of this Section 3) by the certificates for shares of
Common Stock of the Company registered in the names of the holders of
shares of Common Stock of the Company (which certificates for shares
of Common Stock of the Company shall be deemed also to be certificates
for Rights) and not by separate certificates, and (y) the Rights (and
the right to receive certificates therefor) shall be transferable only
in connection with the transfer of the underlying shares of Common
Stock of the Company, including a transfer to the Company. As soon as
practicable after the Distribution Date, the Rights Agent shall send
by first-class, insured, postage prepaid mail, to each record holder
of shares of Common Stock of the Company as of the close of business
on the Distribution Date, at the address of such holder shown on the
records of the Company, a certificate for Rights, in substantially the
form of Exhibit A appended hereto (the "Rights Certificates"),
evidencing one Right for each share of Common Stock of the Company so
held, subject to adjustment as provided herein. As of and after the
Distribution Date, the Rights shall be evidenced solely by such Rights
Certificates.
As soon as practicable following the date hereof, the Company
shall send a copy of a Summary of Rights, in substantially the form
appended hereto as Exhibit B (the "Summary of Rights"), by
first-class, postage prepaid mail, to each record holder of shares of
Common Stock of the Company as of the close of business on the date
hereof,
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at the address of such holder shown on the records of the Company.
Until the Distribution Date (or earlier redemption, expiration or
termination of the Rights), Rights shall, without further action, be
issued in respect of all shares of Common Stock of the Company that
are issued, including any shares of Common Stock of the Company held
in treasury. Until the Distribution Date (or earlier redemption,
expiration or termination of the Rights), the surrender for transfer
of any of the certificates for shares of Common Stock of the Company
outstanding, with or without a copy of the Summary of Rights attached
thereto, shall also constitute the surrender for transfer of the
Rights associated with the shares of Common Stock of the Company
represented by such certificate.
(b) Certificates for shares of Common Stock of the
Company (including, without limitation, certificates issued upon
transfer or exchange of shares of Common Stock of the Company) issued
after the Record Date, but prior to the earlier of the Distribution
Date or the Expiration Date, shall be deemed also to be certificates
for Rights, and such certificates issued after the date hereof shall
have impressed, printed, stamped, written or otherwise affixed onto
such certificates a legend in substantially the following form:
This certificate also evidences and
entitles the holder hereof to certain Rights as
set forth in an Amended and Restated Rights
Agreement between Xxxx Industries, Inc. (the
"Company") and Wachovia Bank, N.A. (the "Rights
Agent") dated as of April 10, 1999 (the "Rights
Agreement"), the terms of which hereby are
incorporated herein by reference and a copy, of
which is on file at the principal offices of the
Company. Under certain circumstances, as set forth
in the Rights Agreement, such Rights may be
redeemed, may expire, or may be evidenced by
separate certificates and will no longer be
evidenced by this certificate. A copy of the
Rights Agreement will be mailed to the holder of
this certificate without charge after receipt of a
written request therefor made to the Rights Agent.
Under certain circumstances, Rights issued to, or
held by, any Acquiring Person (as defined in the
Rights Agreement) or certain related persons and
any subsequent holder of such Rights may become
null and void.
With respect to certificates representing shares of Common Stock of
the Company (whether or not containing the foregoing legend or the
legend provided for in the Original Agreement and whether or not the
Summary of Rights is attached to them), until the earlier of (i) the
Distribution Date, and (ii) the Expiration Date, the Rights associated
with the shares of Common Stock of the Company represented by such
certificates shall be evidenced by such certificates alone, and the
surrender for transfer of any of such certificates shall also
constitute the transfer of the Rights associated with the shares of
Common Stock of the Company represented by such certificates.
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Section 4. Form of Rights Certificates.
(a) The Rights Certificates (and the forms of Election
to Purchase shares and of Assignment to be printed on the reverse side
thereof or attached thereto) shall each be substantially in the forms
set forth in Exhibit A hereto and may have such marks of
identification or designation and such legends, summaries or
endorsements printed thereon as the Company may deem appropriate and
as are not inconsistent with the provisions of this Agreement, or as
may be required to comply with any applicable law or rule or
regulation made pursuant thereto, or with any rule or regulation of
any stock exchange or national marketing or quotation system on which
the Rights may from time to time be listed or quoted, or to conform to
usage. Subject to the provisions of Section 11 and Section 23 hereof,
the Rights Certificates, whenever distributed, shall be dated as of
the Record Date, and on their face shall state that they entitle the
holders thereof to purchase such number of one one-hundredths of a
share of Preferred Stock as shall be set forth therein at the price
per one one-hundredths of a share set forth therein (the "Purchase
Price"), but the amount and type of securities, cash or other assets
that may be acquired upon the exercise of each Right and the Purchase
Price shall be subject to adjustment as provided herein.
(b) Any Rights Certificate issued pursuant to Section 3
(a) hereof that represents Rights beneficially owned by an Acquiring
Person or any Associate or Affiliate thereof and any Rights
Certificate issued at any time upon the transfer of any Rights to such
an Acquiring Person or any Associate or Affiliate thereof or to any
nominee of such Acquiring Person, Associate or Affiliate, and any
Rights Certificate issued pursuant to Section 6 or Section 11 hereof
upon transfer, exchange, replacement or adjustment of any other Rights
Certificate referred to in this sentence, shall contain the following
legend:
The Rights represented by this Rights Certificate were issued
to a Person who was an Acquiring Person or an Affiliate or an
Associate of an Acquiring Person (as such terms are defined
in the Rights Agreement referred to below). This Rights
Certificate and the Rights represented hereby may become null
and void to the extent provided by, and under certain
circumstances as specified in, Section 7(e) of the Rights
Agreement between Xxxx Industries, Inc. and
Wachovia Bank, N.A., dated as of April 10, 1999.
The provisions of Section 7(e) of this Agreement shall be operative
whether or not the foregoing legend is contained on any such Rights
Certificate.
Section 5. Countersignature and Registration. The Rights
Certificates shall be executed on behalf of the Company by its Chairman,
President or any Vice President, either manually or by facsimile signature, and
shall be attested by the Secretary or an Assistant Secretary of the Company,
either manually or by facsimile signature. The Rights Certificates shall be
manually countersigned by the Rights Agent and shall not be valid for any
purpose unless so countersigned. In case any officer of the Company who shall
have signed any of the
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Rights Certificates shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by the Company,
such Rights Certificates, nevertheless, may be countersigned by the Rights
Agent, and issued and delivered by the Company with the same force and effect
as though the person who signed such Rights Certificates had not ceased to be
such officer of the Company; and any Rights Certificates may be signed on
behalf of the Company by any person who, at the actual date of the execution of
such Rights Certificates, shall be a proper officer of the Company to sign such
Rights Certificates, although at the date of the execution of this Agreement
any such person was not such an officer.
Following the Distribution Date, the Rights Agent will keep or cause
to be kept, at its office designated for such purpose, 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 the face of each of the Rights Certificates
and the date of each of the Rights Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of
Rights Certificates; Mutilated, Destroyed, Lost or Stolen Rights Certificates.
Subject to the provisions of Sections 4(b), 7(e) and 15 hereof, at any time
after the close of business on the Distribution Date, and at or prior to the
close of business on the Expiration Date, any Rights Certificate or
Certificates may be transferred, split up, combined or exchanged for another
Rights Certificate or Rights Certificates entitling the registered holder to
purchase a like number of shares of Preferred Stock or other securities, cash
or other assets, as the case may be, as the Rights Certificate or Rights
Certificates surrendered then entitled such holder to purchase. Any registered
holder desiring to transfer, split up, combine or exchange any Rights
Certificate or Rights Certificates shall make such request in writing delivered
to the Rights Agent and shall surrender the Rights Certificate or Rights
Certificates to be transferred, split up, combined or exchanged at the office
of the Rights Agent designated for such purpose. Thereupon the Rights Agent
shall, subject to the provisions of Sections 4(b), 7(e) and 15 hereof,
countersign and deliver to the Person entitled thereto a Rights Certificate or
Rights Certificates, as the case may be, as so requested. The Company may
require payment of a sum sufficient to cover any tax or governmental charge
that may be imposed in connection with any transfer, split up, combination or
exchange of Rights Certificates.
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 case of loss, theft or destruction, of
indemnity or security reasonably satisfactory to them, and reimbursement to the
Company and the Rights Agent of all reasonable expenses incidental thereto, and
upon surrender to the Rights Agent and cancellation of the Rights Certificate
if mutilated, the Company shall execute and deliver a new Rights Certificate of
like tenor to the Rights Agent for countersignature and delivery to the
registered owner in lieu of the Rights Certificate so lost, stolen, destroyed
or mutilated.
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Section 7. Exercise of Rights; Purchase Price; Expiration Date
of Rights.
(a) 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
but prior to the earlier of (i) the close of business on April 10,
2009 (the "Final Expiration Date"), (ii) the time at which the Rights
are redeemed as provided in Section 24 hereof, (iii) the consummation
of a transaction contemplated by Section 13(d) hereof, and (iv) the
exchange of all of the outstanding Rights under Section 35 hereof
(such earlier time being herein referred to as the "Expiration Date")
upon surrender of the Rights Certificate, with the appropriate form of
Election to Purchase on the reverse side thereof or attached thereto
duly executed, to the Rights Agent at the office of the Rights Agent
designated for such purpose, together with payment of the Purchase
Price for each one one-hundredth of a share of Preferred Stock (or
other securities, cash or other assets, as the case may be) as to
which the surrendered Rights are then exercised.
(b) The Purchase Price for each one one-hundredth of a
share of Preferred Stock pursuant to the exercise of a Right shall
initially be $100.00, shall be subject to adjustment from time to time
as provided in Sections 11 and 13 hereof and shall be payable in
accordance with paragraph (c) below.
(c) Upon receipt of a Rights Certificate representing
exercisable Rights, with the appropriate form of Election to Purchase
duly executed, accompanied by payment of the Purchase Price for the
shares of Preferred Stock (or other securities, cash or other assets,
as the case may be) to be purchased and an amount equal to any
applicable transfer tax or evidence satisfactory to the Company of
payment of such tax, the Rights Agent shall, subject to Section 21(k)
hereof, thereupon promptly (i) (A) requisition from any transfer agent
of the shares of Preferred Stock (or make available, if the Rights
Agent is the transfer agent) certificates for the number of shares of
Preferred Stock to be purchased, and the Company hereby irrevocably
authorizes its transfer agent to comply with all such requests, or (B)
if the Company, in its sole discretion, shall have elected to deposit
the shares of Preferred Stock issuable upon exercise of the Rights
hereunder with a depositary, requisition from the depositary agent
depositary receipts representing such number of one one-hundredths of
a share of Preferred Stock as are to be purchased (in which case
certificates for the shares of Preferred Stock represented by such
receipts shall be deposited by the transfer agent with the depositary
agent) and the Company shall direct the depositary agent to comply
with such request, (ii) when appropriate, requisition from the Company
the amount of cash, if any, to be paid in lieu of issuance of
fractional shares in accordance with Section 15 hereof, (iii) promptly
after receipt of such certificates or depositary receipts, cause the
same to be delivered to or upon the order of the registered holder of
such Rights Certificate, registered in such name or names as may be
designated by such holder and (iv) when appropriate, after receipt,
promptly deliver such cash to or upon the order of the registered
holder of such Rights Certificate. In the event that the Company is
obligated to issue shares of Common Stock or other securities of the
Company or pay cash and/or distribute other assets pursuant to Section
11(a), the Company shall make all arrangements necessary so that such
shares of Common Stock or
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other securities, cash and/or other assets are available for
distribution by the Rights Agent, if and when appropriate. In
addition, in the case of an exercise of the Rights by a holder
pursuant to Section 11(a)(ii), the Rights Agent shall return such
Rights Certificate to the registered holder thereof after imprinting,
stamping or otherwise indicating thereon that the rights represented
by such Rights Certificate no longer include the rights provided by
Section 11(a)(ii) of this Agreement and, if less than all the Rights
represented by such Rights Certificate were so exercised, the Rights
Agent shall indicate on the Rights Certificate the number of Rights
represented thereby which continue to include the rights provided by
Section 11(a)(ii) hereof.
(d) In case the registered holder of any Rights
Certificate shall exercise (except pursuant to Section 11(a)(ii)) less
than all the Rights evidenced thereby, a new Rights Certificate
evidencing the Rights remaining unexercised shall be issued by the
Rights Agent and delivered to the registered holder of such Rights
Certificate or to such holder's duly authorized assigns, subject to
the provisions of Section 15 hereof.
(e) Notwithstanding anything in this Agreement to the
contrary, from and after the first occurrence of any event or
transaction set forth in Section 11(a)(ii) or Section 13(a) hereof,
any Rights that are or were, on or after the earlier of the
Distribution Date or the Stock Acquisition Date, beneficially owned by
an Acquiring Person or any Associate or Affiliate thereof, shall
become null and void without any further action on the part of the
Company or the Rights Agent, and any holder of such Rights shall
thereafter have no rights whatsoever with respect to such Rights under
the provisions of this Agreement or otherwise. The Company shall use
all reasonable efforts to ensure that the provisions of Section 7(e)
and Section 4(b) are complied with, but shall have no liability to any
holder of Rights or any other Person as a result of its failure to
make any determination under this Section 7(e) or Section 4(b) with
respect to an Acquiring Person or any Associates or Affiliates thereof
or any transferee of such Acquiring Person or any Associates or
Affiliates thereof.
(f) Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Company shall be obligated
to undertake any action with respect to a registered holder upon the
occurrence of any purported exercise as set forth in this Section 7
unless the certificate contained in the appropriate form of Election
to Purchase set forth on the reverse side of or attached to the Rights
Certificate surrendered for such exercise shall have been properly
completed and duly executed by the registered holder thereof and the
Company shall have been provided with such additional evidence of the
identity of the Beneficial Owner (or former Beneficial Owner) or
Affiliates or Associates thereof as the Company shall reasonably
request.
Section 8. Cancellation and Destruction of Rights Certificates.
All Rights Certificates surrendered for the purpose of exercise, transfer,
split up, combination or exchange shall, if surrendered to the Company or 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 the provisions of this Agreement. The Company shall
deliver to the Rights Agent for cancellation
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and retirement, and the Rights Agent shall so cancel and retire, any other
Rights Certificates purchased or acquired 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, in such case, shall deliver a
certificate of destruction thereof to the Company.
Section 9. Reservation and Availability of Preferred Stock and
Certain Other Company Covenants.
(a) The Company shall cause to be reserved and kept
available out of its authorized and unissued shares of Preferred
Stock, the number of shares of Preferred Stock that will be sufficient
to permit the exercise, in full, of all outstanding Rights.
(b) So long as the shares of Preferred Stock (or other
securities) issuable upon the exercise of the Rights may be listed on
any national securities exchange or quoted on any national marketing
or quotation system, the Company shall use its best efforts to cause,
from and after such time as the Rights become exercisable, all shares
(or other securities) reserved for such issuance to be listed or
included for quotation on such exchange or national marketing or
quotation system upon official notice of issuance upon such exercise.
(c) The Company shall take all such action as may be
necessary to ensure that all shares of Preferred Stock and/or other
securities delivered upon exercise of Rights shall, at the time of
delivery of the certificates or depositary receipts for such shares or
other securities (subject to payment of the Purchase Price), be duly
and validly authorized and issued and fully paid and nonassessable
shares or securities.
(d) The Company shall pay when due and payable any and
all federal and state transfer taxes and charges which may be payable
in respect of the issuance or delivery of the Rights Certificates or
of any certificates or depositary receipts for shares of Preferred
Stock and/or other securities upon the exercise of Rights. The Company
shall not, however, be required to pay any transfer tax which may be
payable in respect of any transfer or delivery of Rights Certificates
to a Person other than, or in respect of the issuance or delivery of
the shares of Preferred Stock and/or other securities in a name other
than that of, the registered holder of the Rights Certificates
evidencing Rights surrendered for exercise, or to issue or deliver any
certificates or depositary receipts for share of Preferred Stock
and/or other securities in a name other than that of the registered
holder upon the exercise of any Rights until such tax shall have been
paid (any such tax being payable by the holder of such Rights
Certificate at the time of surrender) or until it has been established
to the Company's satisfaction that no such tax is due.
(e) The Company shall use its best efforts to file, as
soon as practicable following the Distribution Date, a registration
statement under the Securities Act with respect to the securities
purchasable upon exercise of the Rights on an appropriate form, cause
such registration statement to become effective as soon as practicable
after such filing, and cause such registration statement to remain
effective (with a prospectus at all
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times meeting the requirements of the Securities Act and the rules and
regulations thereunder) until the earlier of (i) the date as of which
the Rights are no longer exercisable for the securities covered by
such registration statement, and (ii) the Expiration Date. The Company
will also take such action as may be appropriate under the blue sky
laws of the various states.
Section 10. Preferred Stock Record Date. Each Person in whose
name any certificate for shares of Preferred Stock (or other securities) is
issued upon the exercise of Rights shall for all purposes be deemed to have
become the holder of record of the shares of Preferred Stock (or other
securities) represented thereby on, and such certificate shall be dated, the
date upon which the Rights Certificate evidencing such Rights was duly
surrendered and payment of the Purchase Price (and any applicable transfer
taxes) was made; provided, however, that if the date of such surrender and
payment is a date upon which the Preferred Stock (or other securities) transfer
books of the Company are closed, such Person shall be deemed to have become the
record holder of such shares of Preferred Stock (or other securities) on, and
such certificate shall be dated, the next succeeding Business Day on which the
Preferred Stock (or other securities) transfer books of the Company are open.
Prior to the exercise of the Rights evidenced thereby, the holder of a Rights
Certificate, as such, shall not be entitled to any rights of a stockholder of
the Company with respect to shares of Preferred Stock (or other securities) for
which the Rights shall be exercisable, including, without limitation, the right
to vote, to receive dividends or other distributions or to exercise any
preemptive rights, if any, and shall not be entitled to receive any notice of
any proceedings of the Company, except as provided herein.
Section 11. Adjustment of Purchase Price, Number and Kind of
Shares or Number of Rights. The Purchase Price, the number of shares of
Preferred Stock or other securities, cash or other assets, as the case may be,
issuable or payable upon the exercise of each Right and the number of Rights
outstanding are subject to adjustment from time to time as provided in this
Section 11.
(a) (i) In the event the Company shall at any time
after the date of this Agreement (A) declare a dividend on
the Preferred Stock payable in shares of Preferred Stock, (B)
subdivide the outstanding Preferred Stock, (C) combine the
outstanding Preferred Stock into a smaller number of shares
or (D) issue any shares of its capital stock in a
reclassification of the Preferred Stock (including any such
reclassification in connection with a consolidation or merger
in which the Company is the continuing or surviving
corporation) except as otherwise provided in this Section
11(a) and in Section 7(e) hereof, the Purchase Price in
effect at the time of the record date for such dividend or of
the effective date of such subdivision, combination or
reclassification, and the number and kind of shares of
Preferred Stock or other securities, cash or other assets, as
the case may be, issuable or payable on such date upon the
exercise of a Right, shall be proportionately adjusted so
that the holder of any Right exercised after such time shall
be entitled to receive upon payment of the Purchase Price
then in effect the aggregate number and kind of shares of
Preferred Stock or other securities, cash or other assets, as
the case may be, which, if such Right had been exercised
immediately prior to such date and at a time when the
Preferred Stock transfer
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books of the Company were open, such holder would have owned
upon such exercise and been entitled to receive by virtue of
such dividend, subdivision, combination or reclassification.
If an event occurs which would require an adjustment under
both Section 11(a)(i) and Section 11(a)(ii) or Section 13,
the adjustment provided for in this Section 11(a)(i) shall be
in addition to, and shall be made prior to, any adjustment
required pursuant to Section 11(a)(ii) or Section 13.
(ii) In the event that any Person (other than
the Company, any subsidiary of the Company, any employee
benefit plan of the Company or any of its subsidiaries or any
entity holding securities of the Company organized, appointed
or established by the Company or any of its subsidiaries for
or pursuant to the terms of any such plan), alone or together
with his or its Affiliates and Associates, shall become an
Acquiring Person (except pursuant to a tender or exchange
offer for all outstanding shares of Common Stock at a price
and on terms determined by at least a majority of the members
of the Board of Directors who are not officers of the Company
to be both adequate and otherwise in the best interests of
the Company and its stockholders, other than the interests of
the Person or an Affiliate or Associate thereof on whose
behalf the offer is being made (a "Permitted Offer")) (a
"Section 11(a)(ii) Event"), then proper provision shall be
made so that each holder of a Right, except as provided in
Section 7(e) hereof, shall, for a period of 60 days after the
later of the occurrence of any such event and the effective
date of an appropriate registration statement pursuant to
Section 9 hereof, have the right to receive, upon exercise
thereof at the then current Purchase Price in accordance with
the terms of this Agreement, in lieu of shares of Preferred
Stock, such number of shares of Common Stock of the Company
as shall equal the result obtained by (x) multiplying the
then current Purchase Price by the then number of one
one-hundredths of a share of Preferred Stock for which a
Right is then exercisable and (y) dividing that product by
50% of the current market price per one share of Common Stock
of the Company as determined pursuant to Section 11(d)
hereof, on the date of the occurrence of the Section
11(a)(ii) Event (such number of shares being referred to as
the number of "Adjustment Shares"); provided, however, that
if the transaction that would otherwise give rise to the
foregoing adjustment is also subject to the provisions of
Section 13 hereof, then only the provisions of Section 13
hereof shall apply and no adjustment shall be made pursuant
to this Section 11(a)(ii).
(iii) In the event that there shall not be
sufficient treasury shares or authorized but unissued shares
of Common Stock of the Company to permit the exercise in full
of the Rights in accordance with the foregoing subparagraph
(ii) and, but for the delay necessary to register such shares
under the Securities Act, the Rights would become so
exercisable, the Company shall (A) determine the excess of
(1) the value of the Adjustment Shares issuable upon the
exercise of a Right (computed using the current market price
used to determine the number of Adjustment Shares) (the
"Current Value") over (2) the then current Purchase Price
(such excess is herein referred to as the "Spread"), and (B)
with respect to
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each Right, make adequate provision so that the holders of
the Rights shall receive, upon the exercise of the Rights and
payment of the applicable Purchase Price, shares of Common
Stock of the Company (up to the maximum number of shares of
Common Stock of the Company which may permissibly be issued
using the allocation procedure specified in the second
sentence of Section 11(k) hereof), and then (after all
treasury and authorized but unissued and unreserved shares of
Common Stock of the Company have been issued) (1) cash, (2) a
reduction in the Purchase Price, (3) shares of Preferred
Stock or other equity securities of the Company (including,
without limitation, shares or units of preferred stock) that
the Board of Directors of the Company has deemed to have the
same economic value and, to the extent permitted by the
Articles of Incorporation, voting rights, as the Common Stock
of the Company (such shares or units of Preferred Stock or
other equity securities are herein referred to as "common
stock equivalents"), (4) debt securities of the Company, (5)
other assets, or (6) any combination of the foregoing, having
an aggregate value equal to the Current Value, where such
aggregate value has been determined by the Board of Directors
of the Company based upon the advice of a nationally
recognized investment banking firm selected by the Board of
Directors of the Company; provided, however, that if the
Company shall not have made adequate provision to deliver
value pursuant to clause (B) above within 30 days following
the later of (x) the first occurrence of a Section 11(a)(ii)
Event and (y) the date on which the Company's right of
redemption pursuant to Section 24(a)(i) expires (the later of
(x) and (y) being referred to herein as the "Section
11(a)(iii) Trigger Date"), then the Company shall be
obligated to deliver, upon the surrender for exercise of a
Right and without requiring payment of the Purchase Price,
shares of Common Stock of the Company (to the extent
available) and then, if necessary, cash, which shares and/or
cash shall have an aggregate value equal to the Spread. If
the Board of Directors of the Company shall determine in good
faith that it is likely that sufficient number of additional
shares of Common Stock of the Company could be authorized by
the shareholders for issuance upon exercise in full of the
Rights, the 30 days period set forth above may be extended to
the extent necessary, but not more than 90 days after the
Section 11(a)(iii) Trigger Date, in order that the Company
may seek shareholder approval for the authorization of such
additional shares (such period, as it may be extended, the
"Substitution Period"). To the extent that the Company
determines that some action need be taken pursuant to the
first and/or second sentences of this Section 11(a)(iii), the
Company (x) shall provide, subject to Section 7(e) hereof,
that such action shall apply uniformly to all outstanding
Rights, and (y) may suspend the exercisability of the Rights
until the expiration of the Substitution Period in order to
seek any authorization of additional shares and/or to decide
the appropriate form of distribution to be made pursuant to
such first sentence and to determine the value thereof. In
the event of any such suspension, the Company shall issue a
public announcement stating that the exercisability of the
Rights has been temporarily suspended, as well as a public
announcement at such time as the suspension is no longer in
effect. For purposes of this Section 11(a)(iii), the value of
the shares of Common Stock of the Company shall be the
current market price (as determined pursuant to Section
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11(d)) on the Section 11(a)(iii) Trigger Date and the value
of any common stock equivalents shall be deemed to have the
same value as the shares of Common Stock of the Company on
such date.
(b) If the Company shall fix a record date for the
issuance of rights, options or warrants to all holders of Preferred
Stock entitling them (for a period expiring within 45 calendar days
after such record date) to subscribe for or purchase Preferred Stock
(or shares having the same or more favorable rights, privileges and
preferences as the Preferred Stock (the "preferred stock equivalent"))
or securities convertible into Preferred Stock or preferred stock
equivalent, at a price per share of Preferred Stock or per share of
preferred stock equivalent (or having a conversion price per share, if
a security convertible into Preferred Stock or preferred stock
equivalent) less than the current market price (as defined in Section
11(d)) per share of Preferred Stock on such record date, the Purchase
Price to be in effect after such record date shall be determined by
multiplying the Purchase Price in effect immediately prior to such
record date by a fraction, the numerator of which shall be the number
of shares of Preferred Stock outstanding on such record date, plus the
number of shares of Preferred Stock which the aggregate offering price
of the total number of shares of Preferred Stock and/or preferred
stock equivalent to be offered (and/or the aggregate initial
conversion price of the convertible securities so to be offered) would
purchase at such current market price and the denominator of which
shall be the number of shares of Preferred Stock outstanding on such
record date, plus the number of additional shares of Preferred Stock
and/or preferred stock equivalent to be offered for subscription or
purchase (or into which the convertible securities so to be offered
are initially convertible). In case such subscription price may be
paid in a consideration part or all of which shall be in a form other
than cash, the value of such consideration shall be determined
reasonably and with good faith to the holders of Rights by the Board
of Directors of the Company whose determination shall be described in
a statement filed with the Rights Agent and shall be binding on the
Rights Agent. Shares of Preferred Stock owned by or held for the
account of the Company shall not be deemed outstanding for the purpose
of any such computation. Such adjustment shall be made successively
whenever such a record date is fixed and, in the event that such
rights or warrants are not so issued, the Purchase Price shall be
adjusted to be the Purchase Price which would then be in effect if
such record date had not been fixed.
(c) If the Company shall fix a record date for the
making of a distribution to all holders of Preferred Stock (including
any such distribution made in connection with a consolidation or
merger in which the Company is the continuing corporation) of
evidences of indebtedness, cash (other than a regular quarterly cash
dividend out of the earnings or retained earnings of the Company),
assets (other than a dividend payable in Preferred Stock, but
including any dividend payable in stock other than Preferred Stock) or
subscription rights or warrants (excluding those referred to in
Section 11(b) hereof), the Purchase Price to be in effect after such
record date shall be determined by multiplying the Purchase Price in
effect immediately prior to such record date by a fraction, the
numerator of which shall be the current market price (as defined in
Section 11(d)) per share of Preferred Stock on such record date, less
the fair market value (as determined reasonably and with good faith to
the holders of Rights by the Board of
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Directors of the Company, whose determination shall be described in a
statement filed with the Rights Agent and shall be binding on the
Rights Agent) of the portion of the cash, assets or (evidences of
indebtedness so to be distributed or of such subscription rights or
warrants distributable in respect of one share of Preferred Stock and
the denominator of which shall be the current market price per share
of the Preferred Stock. Such adjustments shall be made successively
whenever such a record date is fixed and, in the event that such
distribution is not so made, the Purchase Price shall again be
adjusted to be the Purchase Price which would be in effect if such
record date had not been fixed.
(d) (i) For the purpose of any computation hereunder
other than in Section 11(a)(iii), the "current market price"
per share of Common Stock of the Company on any date shall be
deemed to be the average of the daily closing prices per
share of such Common Stock of the Company for the 30
consecutive Trading Days (as such term is hereinafter
defined) immediately prior to such date; provided, however,
that in the event that the current per share market price of
the Common Stock of the Company is determined during a period
following the announcement by the issuer of such Common Stock
of (A) a dividend or distribution on such Common Stock
payable in shares of such Common Stock or securities
convertible into shares of such Common Stock or (B) any
subdivision, combination or reclassification of such Common
Stock, and prior to the expiration of 30 Trading Days after
the ex-dividend date for such dividend or distribution or the
record date for such subdivision, combination or
reclassification, then, and in each such case, the "current
market price" shall be properly adjusted to take into account
ex-dividend trading. The closing price for each day shall be
the last sale price, regular way or, in case no such sale
takes place on that 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 on the principal national
securities exchange on which the shares of Common Stock of
the Company are listed or admitted to trading or, if the
shares of Common Stock of the Company are not listed or
admitted to trading on any national securities exchange, the
last quoted price or, if not so quoted, the average of the
high bid and low asked prices in the over-the-counter market
as reported by the Nasdaq Stock Market or such other system
then in use or, if on any such date the shares of Common
Stock of the Company are not quoted by any such organization,
the average of the closing bid and asked prices as furnished
by a professional market maker making a market in the Common
Stock of the Company selected by the Board of Directors of
the Company. If on any such date no market maker is making a
market in the Common Stock of the Company, the fair value of
such shares on such date as determined reasonably and with
good faith by the Board of Directors of the Company shall be
used and shall be binding on the Rights Agent. The term
"Trading Day" shall mean a day on which the principal
national securities exchange on which the shares of Common
Stock of the Company are listed or admitted to trading is
open for the transaction of business or, if the shares of
Common Stock of the Company are not listed or admitted to
trading on any national securities exchange, a Business Day.
If the Common Stock of the Company is not publicly held or
not so listed or traded,
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"current market price" per share shall mean the fair value
per share determined reasonably and with good faith to the
holders of Rights by the Board of Directors of the Company,
whose determination shall be described in a statement filed
with the Rights Agent and shall be binding on the Rights
Agent.
(ii) For the purpose of any computation
hereunder, the "current market price" per share (or one
one-hundredth of a share) of Preferred Stock shall be
determined in the same manner as set forth above for the
Common Stock of the Company in clause (i) of this Section
11(d) (other than the last sentence thereof). If the current
market price per share (or one one-hundredth of a share) of
Preferred Stock cannot be determined in the manner provided
above, or if the Preferred Stock is not publicly held or
listed or traded in a manner described in clause (i) of this
Section 11(d), the "current market price" per share of
Preferred Stock shall be conclusively deemed to be an amount
equal to 100 (as such number may be appropriately adjusted
for such events as stock splits, stock dividends and
recapitalizations with respect to the Common Stock of the
Company occurring after the date of this Agreement)
multiplied by the current market price per share of the
Common Stock of the Company and the "current market price"
per one one-hundredth of a share of Preferred Stock shall be
equal to the current market price per share of the Common
Stock (as appropriately adjusted). If neither the Common
Stock of the Company nor the Preferred Stock is publicly held
or so listed or traded, "current market price" per share
shall mean the fair value per share as determined in good
faith by the Board of Directors of the Company, whose
determination shall be described in a statement filed with
the Rights Agent and shall be conclusive for all purposes.
(e) Anything herein to the contrary notwithstanding, no
adjustment in the Purchase Price shall be required unless such
adjustment would require an increase or decrease of at least 1% in the
Purchase Price; provided, however, that any adjustments which by
reason of this Section 11(e) are not required to be made shall be
carried forward and taken into account in any subsequent adjustment.
All calculations under this Section 11 shall be made to the nearest
cent or to the nearest ten-thousandth of a share of Common Stock of
the Company or other share or one-hundred-thousandth of a share of
Preferred Stock, as the case may be. Notwithstanding the first
sentence of this Section 11(e), any adjustment required by this
Section 11 shall be made no later than the earlier of (i) three years
from the date of the transaction which mandates such adjustment or
(ii) the Expiration Date.
(f) If as a result of any provision of Section 11(a) or
Section 13(a), the holder of any Right thereafter exercised shall
become entitled to receive any shares of capital stock of the Company
other than Preferred Stock, thereafter the number of such other shares
so receivable upon exercise of any Right and the Purchase Price
thereof shall be subject to adjustment from time to time in a manner
and on terms as nearly equivalent as practicable to the provisions
with respect to the Preferred Stock contained in subsections 11(a)
through (c), inclusive, and the provisions of Sections 7, 9, 10, 13
and 15 hereof with respect to the Preferred Stock shall apply on like
terms to any such other shares.
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(g) All Rights originally issued by the Company
subsequent to any adjustment made to the Purchase Price hereunder
shall evidence the right to purchase, at the adjusted Purchase Price,
the number of shares of Preferred Stock purchasable from time to time
hereunder upon exercise of the Rights, all subject to further
adjustment as provided herein.
(h) Unless the Company shall have exercised its election
as provided in Section 11(i), upon each adjustment of the Purchase
Price as a result of the calculations made in subsections 11(b) and
(c), each Right outstanding immediately prior to the making of such
adjustment shall thereafter evidence the right to purchase, at the
adjusted Purchase Price, that number of one one-hundredths of a share
of Preferred Stock (calculated to the nearest one-hundred-thousandth)
obtained by (i) multiplying (x) the number of one one-hundredths of a
share of Preferred Stock covered by a Right immediately prior to this
adjustment by (y) the Purchase Price in effect immediately prior to
such adjustment of the Purchase Price and (ii) dividing the product so
obtained by the Purchase Price in effect immediately after such
adjustment of the Purchase Price.
(i) The Company may elect on or after the date of any
adjustment of the Purchase Price to adjust the number of Rights in
substitution for any adjustment in the number of shares of Preferred
Stock purchasable upon the exercise of a Right. Each of the Rights
outstanding after the adjustment in the number of Rights shall be
exercisable for the number of one one-hundredths of a share of
Preferred Stock for which a Right was exercisable immediately prior to
such adjustment. Each Right held of record prior to such adjustment of
the number of Rights shall become that number of Rights (calculated to
the nearest ten-thousandth) obtained by dividing the Purchase Price in
effect immediately prior to adjustment of the Purchase Price by the
Purchase Price in effect immediately after adjustment of the Purchase
Price. The Company shall make a public announcement of its election to
adjust the number of Rights, indicating the record date for the
adjustment and, if known at the time, the amount of the adjustment to
be made. This record date may be the date on which the Purchase Price
is adjusted or any day thereafter, but, if the Rights Certificates
have been issued, shall be at least 10 days later than the date of the
public announcement. If Rights Certificates have been issued, upon
each adjustment of the number of Rights pursuant to this Section
11(i), the Company shall, as promptly as practicable, cause to be
distributed to holders of record of Rights Certificates on such record
date, Rights Certificates evidencing, subject to Section 15 hereof,
the additional Rights to which such holders shall be entitled as a
result of such adjustment or, at the option of the Company, shall
cause to be distributed to such holders of record in substitution and
replacement for the Rights Certificates held by such holders prior to
the date of adjustment and, upon surrender thereof, if required by the
Company, new Rights Certificates evidencing all the Rights to which
such holders shall be entitled after such adjustment. Rights
Certificates to be so distributed shall be issued, executed and
countersigned in the manner provided for herein (and may bear, at the
option of the Company, the adjusted Purchase Price) and shall be
registered in the names of the holders of record of Rights
Certificates on the record date specified in the public announcement.
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(j) Irrespective of any adjustment or change in the
Purchase Price or the number of shares of Preferred Stock issuable
upon the exercise of the Rights, the Rights Certificates theretofore
and thereafter issued may continue to express the Purchase Price per
share and the number of shares which were expressed in the initial
Rights Certificates issued hereunder without prejudice to such
adjustment or change.
(k) Before taking any action that would cause an
adjustment reducing the Purchase Price below the then stated value of
the shares of Preferred Stock, Common Stock of the Company or other
securities issuable upon exercise of the Rights, the Company shall
take any corporate action which may, in the opinion of its counsel, be
necessary so that the Company may validly and legally issue fully paid
and nonassessable shares of Preferred Stock, Common Stock of the
Company or other securities at such adjusted Purchase Price. If upon
any exercise of the Rights, a holder is to receive a combination of
shares of Common Stock of the Company and common stock equivalents, a
portion of the consideration paid upon such exercise, equal to at
least the then stated value of a share of Common Stock of the Company,
shall be allocated as the payment for each share of Common Stock of
the Company so received.
(l) In any case in which this Section 11 shall require
that an adjustment in the Purchase Price be made effective as of a
record date for a specified event, the Company may elect to defer
until the occurrence of such event the issuing to the holder of any
Right exercised after such record date of the shares of Preferred
Stock and other capital stock or securities of the Company, if any,
issuable upon such exercise over and above the shares of Preferred
Stock and other capital stock or securities of the Company, if any,
issuable upon such exercise on the basis of the Purchase Price in
effect prior to such adjustment; provided, however, that the Company
shall deliver to such holder a due xxxx or other appropriate
instrument evidencing such holder's right to receive such additional
shares (fractional or otherwise) upon the occurrence of the event
requiring such adjustment.
(m) Anything to the contrary in this Section 11
notwithstanding, the Company shall be entitled to make such reductions
in the Purchase Price, in addition to those adjustments expressly
required by this Section 11, as and to the extent that it, in its sole
discretion, shall determine to be advisable so that any (i)
consolidation or subdivision of the Preferred Stock, (ii) issuance of
any shares of Preferred Stock wholly for cash at less than the current
market price, (iii) issuance, wholly for cash, of shares of Preferred
Stock or securities which by their terms are convertible into or
exchangeable for shares of Preferred Stock, (iv) stock dividends or
(iv) issuance of rights, options or warrants referred to hereinabove
in this Section 11, hereafter made by the Company to holders of its
Preferred Stock, shall not be taxable to such holders or shall reduce
the taxes payable by such holders.
(n) Anything in this Agreement to the contrary
notwithstanding, 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 the outstanding shares of its Common Stock
payable in shares of its Common Stock, (ii) subdivide the outstanding
shares of its
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Xxxxxx Xxxxx, (xxx) combine the outstanding shares of its Common Stock
into a smaller number of shares or (iv) issue any shares of its
capital stock in a reclassification of the outstanding shares of its
Common Stock, the number of Rights associated with each share of
Common Stock of the Company then outstanding, or issued or delivered
thereafter but prior to the Distribution Date, shall be
proportionately adjusted so that the number of Rights thereafter
associated with each share of Common Stock following any such event
shall equal the result obtained by multiplying the number of Rights
associated with each share of Common Stock of the Company immediately
prior to such event by a fraction (the "Adjustment Fraction") the
numerator of which shall be the total number of shares of Common Stock
of the Company outstanding immediately prior to the occurrence of the
event and the denominator of which shall be the total number of shares
of Common Stock of the Company outstanding immediately following the
occurrence of such event. In lieu of such adjustment in the number of
Rights associated with each share of Common Stock of the Company then
outstanding, the Company may elect to adjust the number of one
one-hundredth of a share of Preferred Stock purchasable upon the
exercise of one Right and the Purchase Price and, if the Company makes
such an election, the number of Rights associated with each share of
Common Stock of the Company shall remain unchanged, and the number of
one one-hundredth of a share of Preferred Stock purchasable upon the
exercise of one Right and the Purchase Price shall be proportionately
adjusted so that (i) the number of one one-hundredths of a share of
Preferred Stock purchasable upon the exercise of a Right following
such adjustment shall be equal to the product of the number of one
one-hundredth of a share of Preferred Stock purchasable upon the
exercise of a Right immediately prior to such adjustment multiplied by
the Adjustment Fraction and (ii) the purchase price following such
adjustment shall equal the product of the purchase price immediately
prior to such adjustment multiplied by the Adjustment Fraction. The
adjustments provided for in this Section 11(n) shall be made
successively whenever such a dividend is paid or such a subdivision,
combination or specification is effected.
(o) The exercise of Rights under Section 11(a)(ii)
hereof shall only result in the loss of rights under said Section to
the extent so exercised and shall not otherwise affect the rights
represented by the Rights under this Agreement, including the Rights
represented by Section 13 hereof.
Section 12. Certificate of Adjusted Purchase Price or Number of
Shares. Whenever an adjustment is made as provided in Sections 11 and 13
hereof, the Company shall (a) promptly prepare a certificate setting forth such
adjustment and a brief statement of the facts accounting for such adjustment,
(b) promptly file with the Rights Agent and with each transfer agent for the
Preferred Stock and the Common Stock of the Company a copy of such certificate,
and (c) mail, or cause to be mailed, a brief summary thereof to each holder of
a Rights Certificate in accordance with Section 26 hereof. The Rights Agent
shall be fully protected in relying on any such certificate and on any
adjustment therein contained.
Section 13. Consolidation, Merger or Sale or Transfer of Assets
or Earning Power.
(a) In the event that, following the Stock Acquisition
Date, directly or indirectly, (x) the Company shall consolidate with,
or merge with and into, any other
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Person and the Company shall not be the continuing or surviving
corporation of such consolidation or merger, (y) any Person shall
consolidate with the Company, or merge with and into the Company and
the Company shall be the continuing or surviving corporation of such
consolidation or merger (other than, in the case of either transaction
described in (x) or (y), a merger or consolidation which would result
in all of the Voting Power represented by the securities of the
Company outstanding immediately prior thereto continuing to represent,
either by remaining outstanding or by being converted into securities
of the surviving entity, all of the Voting Power represented by the
securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation and the holders of such
securities not having changed as a result of such merger or
consolidation except to the extent necessary to permit the payment of
cash in lieu of fractional shares for an amount of securities
representing, in the aggregate, not in excess of 1% of the Voting
Power of the securities of the Company outstanding immediately prior
thereto) or (z) the Company shall sell, mortgage or otherwise transfer
(or one or more of its subsidiaries shall sell, mortgage or otherwise
transfer), in one or more transactions, assets or earning power
aggregating more than 50% of the assets or earning power of the
Company and its subsidiaries (taken as a whole) to any other Person or
Persons, then, and in each such case (except as may be contemplated by
Section 13(d) hereof), proper provision shall be made so that (i)
following the Distribution Date, each holder of a Right, except as
provided in Section 7(e), shall have the right to receive, upon the
exercise thereof at the then current Purchase Price in accordance with
the terms of this Agreement, such number of shares of freely tradable
Common Stock of the Principal Party (as hereinafter defined), free and
clear of liens, rights of call or first refusal, encumbrances or other
adverse claims, as shall be equal to the result obtained by (x)
multiplying the then current Purchase Price by the number of one
one-hundredths of a share of Preferred Stock for which a Right is then
exercisable (without taking into account any adjustment previously
made pursuant to Section 11(a)(ii) hereof) and (y) dividing that
product by 50% of the current market price per share of the Common
Stock of such Principal Party (determined pursuant to Section 11(d)
hereof) on the date of consummation of such consolidation, merger,
sale, mortgage or transfer; (ii) such Principal Party shall thereafter
be liable for, and shall assume, by virtue of such consolidation,
merger, sale, mortgage or transfer, all the obligations and duties of
the Company pursuant to this Agreement; (iii) the term "Company" shall
thereafter be deemed to refer to such Principal Party, it being
specifically intended that the provisions of Section 11 hereof shall
apply to such Principal Party; and (iv) such Principal Party shall
take such steps (including, but not limited to, the reservation of a
sufficient number of shares of its Common Stock) in connection with
the consummation of any such transaction as may be necessary to assure
that the provisions hereof shall thereafter be applicable as nearly as
reasonably may be in relation to its shares of Common Stock thereafter
deliverable upon the exercise of the Rights.
(b) "Principal Party" shall mean:
(i) in the case of any transaction described in
clause (x) or (y) of the first sentence of this Section 13,
the Person that is the issuer of any securities into which
shares of Common Stock of the Company are converted in such
merger or
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26
consolidation, and if no securities are so issued, the Person
that is the other party to the merger or consolidation
(including, if applicable, the Company, if it is the
surviving corporation); and
(ii) in the case of any transaction described in
(z) of the first sentence in this Section 13, the Person that
is the party receiving the greatest portion of the assets or
earning power transferred pursuant to such transaction or
transactions;
provided, however, that in any such case, (1) if the Common Stock of
such Person is not at such time and has not been continuously over the
preceding 12-month period registered under Section 12 of the Exchange
Act and such Person is a direct or indirect subsidiary or Affiliate of
another Person whose Common Stock has been so registered, "Principal
Party" shall refer to such other Person; (2) in case such Person is a
subsidiary, directly or indirectly, or Affiliate of more than one
Person, the Common Stock of two or more of which are and have been so
registered, "Principal Party" shall refer to whichever of such Persons
is the issuer of the Common Stock having the greatest aggregate market
value; and (3) in case such Person is owned, directly or indirectly,
by a joint venture formed by two or more Persons that are not owned,
directly or indirectly, by the same Person, the rules set forth in (1)
and (2) above shall apply to each of the chains of ownership having an
interest in such joint venture as if such party were a "subsidiary" of
both or all of such joint venturers and the Principal Parties in each
such chain shall bear the obligations set forth in this Section 13 in
the same ratio as their direct or indirect interests in such Person
bear to the total of such interests.
(c) The Company shall not consummate any such
consolidation, merger, sale, mortgage or transfer unless the Principal
Party shall have a sufficient number of authorized shares of its
Common Stock that have not been otherwise issued or reserved for
issuance to permit the exercise in full of the Rights in accordance
with this Section 13 and unless prior thereto the Company and each
Principal Party and each other Person who may become a Principal Party
as a result of such consolidation, merger, sale, mortgage or transfer
shall have executed and delivered to the Rights Agent a supplemental
agreement providing for the terms set forth in paragraphs (a) and (b)
of this Section 13 and further providing that, as soon as practicable
after the date of any consolidation, merger, sale, mortgage or
transfer of assets mentioned in paragraph (a) of this Section 13, the
Principal Party at its own expense shall:
(i) prepare and file a registration statement
under the Securities Act with respect to the Rights and the
securities purchasable upon exercise of the Rights on an
appropriate form, cause such registration statement to become
effective as soon as practicable after such filing and cause
such registration statement to remain effective (with a
prospectus at all times meeting the requirements of the
Securities Act) until the Expiration Date;
(ii) qualify or register the Rights and the
securities purchasable upon exercise of the Rights under the
blue sky laws of such jurisdictions as may be necessary or
appropriate; and
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(iii) deliver to holders of the Rights historical
financial statements for the Principal Party and each of its
Affiliates which comply in all material respects with the
requirements for registration on Form 10 under the Exchange
Act.
The provisions of this Section 13 shall similarly apply to successive
mergers or consolidations or sales, mortgages or other transfers. The
rights under this Section 13 shall be in addition to the rights to
exercise Rights and adjustments under Section 11(a)(ii) and shall
survive any exercise thereunder.
(d) Notwithstanding anything in this Agreement to the
contrary, this Section 13 shall not be applicable to a transaction
described in subparagraphs (x) and (y) of Section 13(a) if (i) such
transaction is consummated with a Person or Persons who acquired
shares of Common Stock of the Company pursuant to a Permitted Offer
(or a wholly-owned subsidiary of any such Person or Persons), (ii) the
price per share of Common Stock of the Company offered in such
transaction is not less than the price per share of Common Stock of
the Company paid to all holders of Common Stock of the Company whose
shares were purchased pursuant to such Permitted Offer and (iii) the
form of consideration being offered to the remaining holders of Common
Stock of the Company pursuant to such transaction is the same as the
form of consideration paid pursuant to such Permitted Offer. Upon
consummation of any such transaction contemplated by this subsection
(d), all Rights hereunder shall expire.
Section 14. Additional Covenants.
(a) After the Stock Acquisition Date, the Company
covenants and agrees that it shall not (i) consolidate with, (ii)
merge with or into or (iii) sell, mortgage or transfer to, in one or
more transactions, assets or earning power aggregating more than 50%
of the assets or earning power of the Company and its subsidiaries,
taken as a whole, any other Person or Persons if at the time of or
after such consolidation, merger, sale, mortgage or transfer there are
any charter or by-law provisions or any rights, warrants or other
instruments or agreements outstanding or any other action taken which
would diminish or otherwise eliminate the benefits intended to be
afforded by the Rights. The Company shall not consummate any such
consolidation, merger, sale, mortgage or transfer unless prior thereto
the Company and such other Person or Persons shall have executed and
delivered to the Rights Agent a supplemental agreement evidencing
compliance with this subsection.
(b) The Company covenants and agrees that, after the
Stock Acquisition Date, it will not, except as permitted by Section 24
hereof, take any action the purpose or effect of which is to diminish
or otherwise eliminate the benefits intended to be afforded by the
Rights.
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Section 15. Fractional Rights and Fractional Shares.
(a) The Company shall not be required to issue fractions
of Rights, except prior to the Distribution Date as provided in
Section 11(n), or to distribute Rights Certificates which evidence
fractional Rights. In lieu of such fractional Rights, there shall be
paid to the registered holders of the Rights Certificates with regard
to which such fractional Rights would otherwise be issuable, an amount
in cash equal to the same fraction of the current market value of a
whole Right. For the purposes of this Section 15(a), the current
market value of a whole Right shall be the closing price of the Rights
for the Trading Day immediately prior to the date on which such
fractional Rights would have been otherwise issuable. The closing
price of the Rights for any day shall be the last sale price, regular
way, or, in case no such sale takes place on that day, the average of
that closing bid and asked prices, regular way, in either case, as
reported in the principal consolidated transaction reporting system
with respect to securities listed on the principal national securities
exchange on which the Rights are listed or admitted to trading or, if
the Rights are not listed or admitted to trading on any national
securities exchange, the last quoted price or, if not so quoted, the
average of the high bid and low asked prices in the over-the-counter
market as reported by the Nasdaq Stock Market or such other system
then in use or, if on any such date the Rights are not quoted by any
such organization, the average of the closing bid and asked prices as
furnished by a professional market maker making a market in the Rights
selected by the Board of Directors of the Company or, if on any such
date no such market maker is making a market in the Rights, the fair
value of the Rights on such date as determined reasonably and with
good faith to the holders of Rights by the Board of Directors of the
Company shall be used and shall be binding on the Rights Agent.
(b) The Company shall not be required to issue fractions
of shares of Preferred Stock (other than fractions which are integral
multiples of one one-hundredth of a share of Preferred Stock) upon
exercise of the Rights or to distribute certificates which evidence
fractional shares of Preferred Stock (other than fractions which are
integral multiples of one one-hundredth of a share of Preferred
Stock). Fractions of shares of Preferred Stock in integral multiples
of one one-hundredth of a share of Preferred Stock may, at the
election of the Company, be evidenced by depositary receipts pursuant
to an appropriate agreement between the Company and a depositary
selected by it, provided that such agreement shall provide that the
holders of such depositary receipts shall have all the rights,
privileges and preferences to which they are entitled as beneficial
owners of the shares of Preferred Stock represented by such depositary
receipts. In lieu of fractional shares of Preferred Stock that are not
integral multiples of one one-hundredth of a share of Preferred Stock,
the Company may pay to the registered holders of Rights Certificates
at the time such Rights are exercised as herein provided an amount in
cash equal to the same fraction of the current market value of one
one-hundredth of a share of Preferred Stock. For purposes of this
Section 15(b), the current market value of one one-hundredth of a
share of Preferred Stock shall be one one-hundredth of the closing
price of a share of Preferred Stock (as determined pursuant to Section
11(d)(ii) hereof) for the Trading Day immediately prior to the date of
such exercise.
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(c) Following the occurrence of one of the transactions
or events specified in Section 11 giving rise to the right to receive
common stock equivalents (other than Preferred Stock) or other
securities upon the exercise of a Right, the Company shall not be
required to issue fractions of shares or units of such common stock
equivalents or, other securities upon exercise of the Rights or to
distribute certificates which evidence fractional shares of such
common stock equivalents or other securities. In lieu of fractional
shares or units of such common stock equivalents or other securities,
the Company may pay to the registered holders of Rights Certificates
at the time such Rights are exercised as herein provided an amount in
cash equal to the same fraction of the current market value of a share
or unit of such common stock equivalent or other securities. For
purposes of this Section 15(c), the current market value shall be
determined in the manner set forth in Section 11(d) hereof for the
Trading Day immediately prior to the date of such exercise and, if
such common stock equivalent is not traded, each such common stock
equivalent shall have the value of one one-hundredth of a share of
Preferred Stock.
(d) Except as otherwise expressly provided herein, the
holder of a Right by the acceptance of the Rights expressly waives his
right to receive any fractional Rights or any fractional shares upon
exercise of a Right.
Section 16. Rights of Action. All rights of action in respect of
this Agreement, other than rights of action vested in the Rights Agent pursuant
to Section 19, are vested in the respective registered holders of the Rights
Certificates (and, prior to the Distribution Date, the registered holders of
shares of Common Stock of the Company); and any registered holder of any Rights
Certificate (or, prior to the Distribution Date, of the Common Stock of the
Company), without the consent of the Rights Agent or of the holder of any other
Rights Certificate (or, prior to the Distribution Date, of shares of Common
Stock of the Company) may, in 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 in the manner provided in such Rights Certificate and
in this Agreement. Without limiting the foregoing or any remedies available to
the holders of Rights, it is specifically acknowledged that the holders of
Rights would not have an adequate remedy at law for any breach of this
Agreement and shall be entitled to specific performance of the obligations
hereunder and injunctive relief against actual or threatened violations of the
obligations hereunder of any Person subject to this Agreement. Holders of
Rights shall be entitled to recover the reasonable costs and expenses,
including attorneys, fees, incurred by them in any action to enforce the
provisions of this Agreement.
Section 17. Agreement of Rights Holders. Every holder of a Right
by accepting the same consents and agrees with the Company and the Rights Agent
and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of shares of Common
Stock of the Company;
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30
(b) after the Distribution Date, the Rights Certificates
are transferable only on the registry books of the Rights Agent if
surrendered at the office of the Rights Agent designated for such
purpose, duly endorsed or accompanied by a proper instrument of
transfer;
(c) the Company and the Rights Agent may deem and treat
the Person in whose name a Rights Certificate (or, prior to the
Distribution Date, the associated Common Stock certificate) is
registered as the absolute owner thereof and of the Rights evidenced
thereby (notwithstanding any notations of ownership or writing on the
Rights Certificate or the associated Common Stock certificate made by
anyone other than the Company or the Rights Agent) for all purposes
whatsoever, and neither the Company nor the Rights Agent shall be
affected by any notice to the contrary; and
(d) Anything in this Agreement to the contrary
notwithstanding, neither the Company nor the Rights Agent shall have
any liability to any holder of a Right or any other Person as a result
of its inability to perform any of its obligations under this
Agreement by reason of any preliminary or permanent injunction or
other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative agency
or commission or any statute, rule regulation or order promulgated or
enacted by any governmental authority prohibiting or otherwise
restraining performance of such obligations; provided, however, that
the Company must use its best efforts to have any such order, decree
or ruling lifted or otherwise overturned as promptly as practicable.
Section 18. Rights Certificate Holder Not Deemed a Stockholder.
No holder, as such, of any Rights Certificate shall be entitled to vote,
receive dividends or be deemed for any purpose the holder of the shares of
Preferred Stock, Common Stock or any other securities of the Company which may
at any time be issuable on the exercise of the Rights represented thereby, nor
shall anything contained herein or in any 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 matter submitted to stockholders at any meeting thereof, or to give
or withhold consent to any corporate actions or to receive notice of meetings
or other actions affecting stockholders (except as provided in Section 25
hereof), or to receive subscription rights, or otherwise, until the Right or
Rights evidenced by such Rights Certificate shall have been exercised in
accordance with the provisions thereof.
Section 19. Concerning the Rights Agent. The Company agrees to
pay to the Rights Agent reasonable compensation for all services rendered by it
hereunder and, from time to time, on demand of the Rights Agent, its reasonable
expenses and counsel fees and disbursements and other disbursements incurred in
the administration and execution of this Agreement and the exercise and
performance of its duties hereunder. The Company also agrees to indemnify the
Rights Agent for, and to hold it harmless against, any loss, liability or
expense incurred without gross negligence, bad faith or willful misconduct on
the part of the Rights Agent, for anything done or omitted by the Rights Agent
in connection with the acceptance and administration of this Agreement,
including the costs and expenses of defending against any claim of liability
arising therefrom, directly or indirectly.
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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 or
certificate for shares of Common Stock or for other securities of the Company,
instrument of assignment or transfer, power-of-attorney, endorsement,
affidavit, letter, notice, direction, consent, certificate, statement, or other
paper or document believed by it to be genuine and to be signed, executed and,
where necessary, verified or acknowledged, by the proper Person or Persons.
Section 20. Merger or Consolidation or Change of Name of Rights
Agent. Any corporation into which the Rights Agent or any successor Rights
Agent may be merged or with which it may be consolidated, or any corporation
resulting from any merger or consolidation to which the Rights Agent or any
successor Rights Agent shall be a party, or any corporation succeeding to the
corporate trust business of the Rights Agent or any successor Rights Agent,
shall be the successor to the Rights Agent under this Agreement without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, provided that such corporation would be eligible for
appointment as a successor Rights Agent under the provisions of Section 22
hereof. In case at the time such successor Rights Agent shall succeed to the
agency created by this Agreement, any of the Rights Certificates shall have
been countersigned but not delivered, any such successor Rights Agent may adopt
the countersignature of the predecessor Rights Agent and deliver such Rights
Certificates so countersigned; and in case at that time any of the Rights
Certificates shall not have been countersigned, any successor Rights Agent may
countersign such Rights Certificates either in the name of the predecessor or
in the name of the successor Rights Agent; and in all such cases such Rights
Certificates shall have the full force provided in the Rights Certificates and
in this Agreement.
In case at any time the name of the Rights Agent shall be changed and
at such time any of the Rights Certificates shall have been countersigned but
not delivered, the Rights Agent may adopt the countersignature under its prior
name and deliver Rights Certificates so countersigned; and in case at that time
any of the Rights Certificates shall not have been countersigned, the Rights
Agent may countersign such Rights Certificates either in its prior name or in
its changed name; and in all such cases such Rights Certificates shall have the
full force provided in the Rights Certificates and in this Agreement.
Section 21. Duties of Rights Agent. The Rights Agent undertakes
the duties and obligations imposed by this Agreement upon the following terms
and conditions, by all of which the Company and the holders of Rights
Certificates, by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel
selected by it (who may be legal counsel for the Company), and the
opinion of such counsel shall be full and complete authorization and
protection to the Rights Agent as to any action taken or omitted by it
in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this
Agreement the Rights Agent shall deem it necessary, or desirable that
any fact or matter (including, without limitation, the identity of any
Acquiring Person) be proved or established by the
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Company prior to taking or suffering any action hereunder, such fact
or matter (unless other evidence in respect thereof be herein
specifically prescribed) may be deemed to be conclusively proved and
established by a certificate signed by the Chairman, President, any
Vice President, Secretary or Chief Financial Officer of the Company
and delivered to the Rights Agent; and such certificate shall be full
authorization to the Rights Agent for any action taken or suffered in
good faith by it under the provisions of this Agreement in reliance
upon such certificate.
(c) The Rights Agent shall be liable hereunder only for
its own gross negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by
reason of any of the statements of fact or recitals contained in this
Agreement or in the Rights Certificates (except as to the fact that it
has countersigned the Rights Certificates) 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 have any responsibility
for the validity of this Agreement or the execution and delivery
hereof (except the due execution hereof by the Rights Agent) or in
respect of the validity or execution of any Rights Certificate (except
its countersignature thereof); nor shall it be responsible for any
breach by the Company of any covenant or condition contained in this
Agreement or in any Rights Certificate; nor shall it be responsible
for any adjustment required under the provisions of Sections 11 or 13
hereof or for the manner, method or amount of any such adjustment or
the ascertaining of the existence of facts that would require any such
adjustment (except with respect to the exercise of Rights evidenced by
Rights Certificates after actual notice of any such adjustment); nor
shall it be responsible for the calculations of the market value of
the Rights, the Preferred Stock or the Common Stock of the Company
pursuant to the provisions hereof; nor shall it by any act hereunder
be deemed to make any representation or warranty as to the
authorization or reservation of any shares of Preferred Stock or other
securities to be issued pursuant to this Agreement or any Rights
Certificate or as to whether any shares of Preferred Stock or other
securities will, when so issued, be validly authorized and issued,
full, paid and nonassessable.
(f) The Company will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered
all such further and other acts, instruments and assurances as may
reasonably be required by the Rights Agent for the carrying out or
performing by the Rights Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed
to accept instructions with respect to the performance of its duties
hereunder and certificates delivered pursuant to any provision hereof
from the Chairman, President, any Vice President, Secretary or Chief
Financial Officer of the Company, and is authorized to apply to such
officers for advice or instructions in connection with its duties, and
it shall not be liable for any action taken or suffered to be taken by
it in good faith in accordance with instructions of any such officer.
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(h) The Rights Agent and any stockholder, director,
officer or employee of the Rights Agent may buy, sell or deal in any
of the Rights or other securities of the Company or become pecuniarily
interested in any transaction in which the Company may be interested,
or contract with or lend money to the Company or otherwise act as
fully and freely as though it were not Rights Agent under this
Agreement. Nothing herein shall preclude the Rights Agent from acting
in any other capacity for the Company or for any other legal entity.
(i) The Rights Agent may execute and exercise any of the
rights or powers hereby vested in it or perform any duty hereunder
either itself or by or through its attorneys or agents, and the Rights
Agent shall not be answerable or accountable for any act, omission,
default, neglect or misconduct of any such attorneys or agents or for
any loss to the Company or to the holders of the Rights resulting from
any such act, omission, default, neglect or misconduct, provided
reasonable care was exercised in the selection and continued
employment thereof.
(j) No provision of this Agreement shall require the
Rights Agent to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder
or in the exercise of its rights if there shall be reasonable grounds
for believing that repayment of such funds or adequate indemnification
against such risk or liability is not reasonably assured to it.
(k) If, with respect to any Rights Certificate
surrendered to the Rights Agent for exercise or transfer, the
certificate attached to the form of Assignment or form of Election to
Purchase, as the case may be, has either not been completed or
indicates an affirmative response to clause 1 or 2 thereof, the Rights
Agent shall not take any further action with respect to such requested
exercise of transfer without first consulting with the Company.
Section 22. Change of Rights Agent. The Rights Agent or any
successor Rights Agent may resign and be discharged from its duties under this
Agreement upon 30 days' notice in writing, mailed to the Company and to each
transfer agent of the Common Stock of the Company and Preferred Stock by
registered or certified mail. The Company may remove the Rights Agent or any
successor Rights Agent upon 30 days' notice in writing, mailed to the Rights
Agent or successor Rights Agent, as the case may be, and to each transfer agent
of the Common Stock of the Company and Preferred Stock by registered or
certified mail, and to the holders of the Rights Certificates by first-class
mail. If the Rights Agent shall resign or be removed or shall otherwise become
incapable of acting, the Company shall appoint a successor to the Rights Agent.
If the Company shall fail to make such appointment within a period of 30 days
after giving notice of such removal or after it has been notified in writing of
such resignation or incapacity by the resigning or incapacitated Rights Agent or
by the holder of a Rights Certificate (who shall, with such notice, submit his
Rights Certificate for inspection by the Company), then the registered holder of
any Rights Certificate may apply to any court of competent jurisdiction for the
appointment of a new Rights Agent. Any successor Rights Agent, whether appointed
by the Company or by
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such a court, shall be (a) a corporation organized and doing business under the
laws of the United States or of any state of the United States, in good
standing, which is authorized under such laws to exercise corporate trust
powers and is subject to supervision or examination by federal or state
authority and which has at the time of its appointment as Rights Agent a
combined capital and surplus of at least $50,000,000 or (b) an affiliate of a
corporation described in clause (a) of this sentence. After appointment, the
successor Rights Agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been named originally as Rights Agent without
further act or deed; but the predecessor Rights Agent shall deliver and
transfer to the successor Rights Agent any property at the time held by it
hereunder, and execute and deliver any further assurance, conveyance, act or
deed necessary for the purpose. Not later than the effective date of any such
appointment, the Company shall file notice thereof in writing with the
predecessor Rights Agent and each transfer agent of the Common Stock of the
Company and Preferred Stock, and mail a notice thereof to the registered
holders of the Rights Certificates. Failure to give any notice provided for in
this Section 22, however, or any defect therein, shall not affect the legality
or validity of the resignation or removal of the Rights Agent or the
appointment of the successor Rights Agent, as the case may be.
Section 23. Issuance of New Rights Certificates. Notwithstanding
any of the provisions of this Agreement or of the Rights Certificates to the
contrary, the Company may, at its option, issue new Rights Certificates
evidencing Rights in such form as may be approved by its Board of Directors to
reflect any adjustment or change in the Purchase Price per share and the number
or kind or class of shares or other securities or property purchasable upon the
exercise of Rights made in accordance with the provisions of this Agreement. In
addition, in connection with the issuance or sale of shares of Common Stock of
the Company following the Distribution Date and prior to the Expiration Date,
the Company (a) shall, with respect to shares of Common Stock of the Company so
issued or sold pursuant to the exercise of stock options or under any employee
benefit plan or arrangement, or upon the exercise, conversion or exchange of
securities issued by the Company prior to the Distribution Date and (b) may, in
any other case, if deemed necessary or appropriate by the Board of Directors of
the Company, issue Rights Certificates representing the number of Rights that
would have been issued in respect of such shares of Common Stock of the Company
had they been issued or sold prior the Distribution Date, as appropriately
adjusted as provided herein as if they had been so issued or sold prior to the
Distribution Date; provided, however, that (i) no such Rights Certificates
shall be issued if, and to the extent that, in good faith judgment of the Board
of Directors of the Company such issuance would create a significant risk of
material adverse tax consequences to the Company or to the Persons to whom such
Rights Certificates otherwise would be issued, and (ii) no such Rights
Certificates shall be issued, if and to the extent that, appropriate
adjustments shall otherwise have been made in lieu of the issuance thereof.
Section 24. Redemption and Termination.
(a) (i) The Board of Directors of the Company may, at its
option, at any time prior to the earlier of (x) the close of
business on the tenth Business Day following the time that
any Person becomes an Acquiring Person or (y) 4:00 P.M.,
local Atlanta, Georgia time on the Final Expiration Date,
redeem all but not less than all of the then outstanding
Rights at a redemption price of $.01 per Right,
-31-
35
appropriately adjusted to reflect any stock split, stock
dividend or similar transaction occurring after the date
hereof (such redemption price being hereinafter referred to
as the "Redemption Price").
(ii) In addition, the Board of Directors of the
Company may redeem all but not less than all of the then
outstanding Rights at the Redemption Price following the
occurrence of a Stock Acquisition Date but prior to any event
described in Section 13(a) either (x) in connection with any
event specified in Section 13(a) in which all holders of
Common Stock of the Company are treated alike and not
involving (other than as a holder of Common Stock of the
Company being treated like all other such holders) an
Acquiring Person or an Affiliate or Associate of an Acquiring
Person or any other Person in which such Acquiring Person,
Affiliate or such Associate has any interest, or any other
Person acting directly or indirectly on behalf of or in
association with any such Acquiring Person, Affiliate or
Associate or (y) following the occurrence of and event set
forth in, and the expiration of any period during which the
holder of Rights may exercise such holder's rights under,
Section 11(a)(ii), if and for as long as the Acquiring Person
is not thereafter the Beneficial Owner of securities
representing 15% or more of the Voting Power of all
outstanding securities of the Company and at the time of
redemption there are no other Persons who are Acquiring
Persons.
(b) In the case of a redemption permitted under Section
24(a)(i), immediately upon the action of the Board of Directors of the
Company ordering the redemption of the Rights, evidence of which shall
have been filed with the Rights Agent, and without any further action
and without any notice, the right to exercise the Rights will
terminate and the only right thereafter of the holders of Rights shall
be to receive the Redemption Price. In the case of a redemption
permitted only under Section 24(a)(ii), evidence of which shall have
been filed with the Rights Agent, the right to exercise the Rights
will terminate and represent only the right to receive the Redemption
Price only after ten Business Days following the giving of notice of
such redemption to the holders of such Rights if no Section 11(a)(ii)
Event shall have occurred, and, if such event shall have occurred,
upon the later of ten Business Days following the giving of such
notice or the expiration of any period during which the rights under
Section 11(a)(ii) may be exercised. Within ten days after the action
of the Board of Directors ordering any such redemption of the Rights,
the Company shall give notice of such redemption to the Rights Agent
and the holders of the then outstanding Rights by mailing such notice
to the Rights Agent and to all such holders at their last addresses as
they appear upon the registry books of the Rights Agent or, prior to
the Distribution Date, on the registry books of the transfer agent for
the Common Stock of the Company. Any notice which is mailed in the
manner herein provided shall be deemed given, whether or not the
holder receives the notice. Each such notice of redemption will state
the method by which the payment of the Redemption Price will be made.
(c) In the case of a redemption permitted under Section
24(a)(i) or (ii), the Company may, at its option, discharge all of its
obligations with respect to the Rights by
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36
(i) issuing a press release announcing the manner of redemption of the
Rights and (ii) mailing payment of the Redemption Price to the
registered holders of the Rights at their last addresses as they
appear on the registry books of the Rights Agent or, prior to the
Distribution Date, on the registry books of the transfer agent of the
Common Stock of the Company and, upon such action, all outstanding
Rights Certificates shall be null and void without any further action
by the Company.
Section 25. Notice of Certain Events. In case at any time after
the Distribution Date the Company shall propose (a) to pay any dividend payable
in stock of any class to the holders of Preferred Stock or to make any other
distribution to the holders of Preferred Stock (other than a regular quarterly
cash dividend out of earnings or retained earnings of the Company), (b) to
offer to the holders of Preferred Stock rights or warrants to subscribe for or
to purchase any additional shares of Preferred Stock or shares of stock of any
class or any other securities, rights or options, (e) to effect any
reclassification of its Preferred Stock (other than a reclassification
involving only the subdivision of outstanding shares of Preferred Stock), (d)
to effect any consolidation or merger into or with, or to effect any sale or
other transfer (or to permit one or more of its subsidiaries to effect any sale
or other transfer), in one or more transactions, of more than 50% of the assets
or earning power of the Company and its subsidiaries (taken as a whole), to any
other Person or Persons or (e) to effect the liquidation, dissolution or
winding up of the Company, then, in each such case, the Company shall give to
each holder of a Rights Certificate, in accordance with Section 26 hereof, a
notice of such proposed action, which shall specify the record date for the
purposes of such stock dividend, distribution of rights or warrants, or the
date on which such reclassification, consolidation, merger, sale, transfer,
liquidation, dissolution or winding up is to take place and the date of
participation therein by the holders of the shares of Preferred Stock, if any
such date is to be fixed. Such notice shall be so given in the case of any
action covered by clause (a) or (b) above at least 20 days prior to the record
date for determining holders of the shares of Preferred Stock for purposes of
such action, and in the case of any such other action, at least 20 days prior
to the date of the taking of such proposed action or the date of participation
therein by the holders of the shares of Preferred Stock, whichever shall be the
earlier.
In case any Section 11(a)(ii) Event shall occur, then, in any such
case, the Company shall as soon as practicable thereafter give to each holder
of a Rights Certificate, in accordance with Section 26 hereof, a notice of the
occurrence of such event which shall specify the event and the consequences of
the event to holders of Rights under Section 11(a)(ii) hereof.
Section 26. Notices. Notices or demands authorized by this
Agreement to be given or made by the Rights Agent or by the holder of any
Rights Certificate to the Company shall be sufficiently given or made if sent
by first-class mail, postage prepaid, addressed (until another address is filed
in writing with the Rights Agent) as follows:
Xxxx Industries, Inc.
000 X. Xxxxxx Xxxxxx
Xxxxxx, Xxxxxxx 00000
Attention: Secretary
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Subject to the provisions of Section 22, any notice or demand authorized by
this Agreement to be given or made by the Company or by the holder of any
Rights Certificate to the Rights Agent shall be sufficiently given or made if
sent by first-class mail, postage prepaid, addressed (until another address is
filed in writing with the Company) as follows:
Wachovia Bank, N.A.
000 Xxxxx Xxxxxx Xxxxxx
0xx Xxxxx--Xxxxxxxxxxx Services
Xxxxxxx-Xxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Rights Certificate shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed to such holder at the address of such holder as shown on the registry
books of the Rights Agent.
Section 27. Supplements and Amendments. Prior to the
Distribution Date, the Company may and, if the Company so directs, the Rights
Agent shall, supplement or amend any provisions of this Agreement without the
approval of any holders of certificates representing shares of Common Stock of
the Company. From and after the Distribution Date, the Company may and, if the
Company so directs, the Rights Agent shall, supplement or amend this Agreement
without approval of any holders of Rights Certificates (i) to cure any
ambiguity, (ii) to correct or supplement any provision contained herein which
may be defective or inconsistent with any other provisions herein, (iii) to
shorten or lengthen any time period hereunder, or (iv) to change or supplement
the provisions hereunder in any manner which the Company may deem necessary or
desirable and which shall not adversely affect the interests of the holders of
Rights Certificates (other than an Acquiring Person or an Affiliate or
Associate of an Acquiring Person); provided, however, that this Agreement may
not be supplemented or amended to lengthen, pursuant to clause (iii) of the
previous sentence (A) subject to Section 28, a time period relating to when the
Rights will be redeemed at such time as the Rights are not redeemable or (B)
any other time period unless such lengthening is for the purpose of protecting,
enhancing or clarifying the Rights of, and/or the benefits to, the holders of
Rights. Upon the delivery of a certificate from an appropriate officer of the
Company which states that the proposed supplement or amendment is in compliance
with the terms of this Section 27, the Rights Agent shall execute such
supplement or amendment. Prior to the Distribution Date, the interests of the
holders of Rights shall be deemed coincident with the interests of the holders
of Common Stock of the Company.
Section 28. Determination and Actions by the Board of Directors,
etc. For all purposes of this Agreement, any calculation of the number of
shares of Common Stock of the Company outstanding at any particular time,
including for purposes of determining the particular percentage of such
outstanding shares of Common Stock or any other securities of which any Person
is the Beneficial Owner, shall be made in accordance with the last sentence of
Rule 13d-3(d)(1)(i) under the Exchange Act as in effect on the date of this
Agreement. Except as otherwise specifically provided herein, the Board of
Directors of the Company shall have the exclusive power and authority to
administer this Agreement and to exercise all rights and powers specifically
granted to the Board or the Company or as may be necessary or advisable in the
-34-
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administration of this Agreement, including, without limitation, the right and
power to (i) interpret the provisions of this Agreement and (ii) make all
determinations deemed necessary or advisable for the administration of this
Agreement (including a determination to redeem or not redeem the Rights or to
amend this Agreement). All such actions, calculations, interpretations and
determinations (including, for purposes of clause (y) below, all omissions with
respect to the foregoing) which are done or made by the Board of Directors in
good faith shall (x) be final, conclusive and binding on the Company, the
Rights Agent, the holders of the Rights Certificates and all other parties and
(y) not subject the Board of Directors of the Company or any member thereof to
any liability to the holders of the Rights.
Section 29. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Rights Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.
Section 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 holder of shares of 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 holder of
shares of Common Stock of the Company).
Section 31. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction or
other authority to be invalid, void or unenforceable, the remainder of the
terms, provisions, covenants and restrictions of this Agreement shall remain in
full force and effect and shall in no way be affected, impaired or invalidated
thereby.
Section 32. Governing Law. This Agreement, each Right and each
Rights Certificate issued thereunder shall be deemed to be a contract made
under the laws of the State of Georgia and for all purposes shall be governed
by and construed in accordance with the laws of such State applicable to
contracts to be made and to be performed entirely within such State.
Section 33. Counterparts. This Agreement may be executed in any
number of counterparts and each of such counterparts shall for all purposes be
deemed to be an original, and all such counterparts shall together constitute
but one and the same agreement.
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.
35. Exchange.
(a) The Company may, at its option, at any time after
any Person becomes an Acquiring Person, upon resolution adopted by the
Board of Directors of the Company, exchange all or part of the then
outstanding and exercisable Rights (which shall not
-35-
39
include Rights that have become null and void pursuant Section 7(e))
for shares of Common Stock of the Company at an exchange ratio of one
share of Common Stock per Right, appropriately adjusted to reflect any
stock split, stock dividend or similar transaction occurring after the
date hereof (such exchange ratio being hereinafter referred to as the
"Exchange Ratio"). Notwithstanding the foregoing, the Company may not
effect such exchange at any time after any Person (other than the
Company, any subsidiary of the Company or any employee benefit plan of
the Company or any of its subsidiaries or any entity holding
securities of the Company organized, appointed or established by the
Company or any of its subsidiaries for or pursuant to the terms of any
such plan), together with all Affiliates and Associates of such
Person, becomes the Beneficial Owner of 50% or more of the shares of
Common Stock of the Company then outstanding.
(b) Immediately upon the action of the Board of
Directors ordering the exchange of any Rights pursuant to Section
35(a) and without any further action and without any notice, the right
to exercise such Rights shall terminate and the only right thereafter
of a holder of such Rights shall be to receive that number of shares
of Common Stock of the Company equal to the number of such Rights held
by such holder multiplied by the Exchange Ratio. The Company shall
promptly give public notice of any such exchange; provided, however,
that the failure to give, or any defect in, such notice shall not
affect the validity of such exchange. The Company promptly shall mail
a notice of any such exchange to all of the holders of such Rights at
their last addresses as they appear upon the registry books of the
Rights Agent. Any notice which is mailed in the manner herein provided
shall be deemed given, whether or not the holder receives the notice.
Each such notice of exchange shall state the method by which the
exchange of shares of Common Stock of the Company 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 based on the number of Rights (other than Rights which have
become null and void pursuant to Section 7(e)) held by each holder of
Rights.
(c) In the event that the number of shares of Common
Stock of the Company which are held in treasury or authorized by the
Articles of Incorporation but not outstanding or reserved for issuance
for purposes other than upon exercise of the Rights are not sufficient
to permit any exchange of Rights as contemplated in accordance with
this Section 35, the Company shall take all such action as may be
necessary to authorize additional shares of Common Stock of the
Company for issuance upon exchange of the Rights or make adequate
provision to substitute for the number of shares of Common Stock of
the Company issuable upon the exchange of each Right (1) cash, (2)
shares of Preferred Stock or other equity securities of the Company,
(3) debt securities of the Company, (4) other assets, or (5) any
combination of the foregoing, having an aggregate value that has been
determined by the Board of Directors in good faith to be equal to the
then current market price of the shares of Common Stock of the Company
issuable upon such exchange determined in accordance with Section
11(d) on the Trading Day immediately prior to the day public notice of
the exchange is given pursuant to Section 35(b).
-36-
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(d) The Company shall not be required to issue fractions
of shares of Common Stock of the Company or to distribute certificates
which evidence fractional shares of Common Stock of the Company. In
lieu of fractional shares of Common Stock, the Company may pay to the
registered holders of Rights Certificates at the time such Rights are
exchanged as herein provided an amount in cash equal to the same
fraction of the current market price (determined pursuant to Section
11(d)) of a share of Common Stock of the Company.
-37-
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, all as of the day and year first above written.
[Corporate Seal] COMPANY:
XXXX INDUSTRIES, INC.
ATTEST:
By: By:
------------------------- ---------------------------
Xxxxxx X. Xxxxxxxx Name:
Secretary -------------------------
Title:
------------------------
RIGHTS AGENT:
WACHOVIA BANK, N.A.
By: (BANK SEAL)
----------------
Name:
-------------------------
Title:
------------------------
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EXHIBIT A
[Form of Rights Certificate]
Certificate No. R- Rights
-------
NOT EXERCISABLE AFTER APRIL 10, 2009 OR EARLIER IF NOTICE OF
REDEMPTION IS GIVEN. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE
OPTION OF THE COMPANY, AT $.01 PER RIGHT ON THE TERMS SET FORTH IN THE
RIGHTS AGREEMENT. [THE RIGHTS REPRESENTED BY THIS CERTIFICATE WERE
ISSUED TO A PERSON WHO WAS AN ACQUIRING PERSON OR AN ASSOCIATE OR
AFFILIATE OF AN ACQUIRING PERSON. THIS RIGHTS CERTIFICATE AND THE
RIGHTS REPRESENTED HEREBY MAY BECOME NULL AND VOID TO THE EXTENT
PROVIDED IN AND UNDER THE CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF
THE RIGHTS AGREEMENT.]1/
RIGHTS CERTIFICATE
XXXX INDUSTRIES, INC.
This certifies that ______________________________, or
registered assigns, is the registered owner of the number of Rights
set forth above, each of which entitles the owner thereof, subject to
the terms, provisions and conditions of the Amended and Restated
Rights Agreement dated as of April 10, 1999 (the "Rights Agreement")
between Xxxx Industries, Inc., a Georgia corporation (the "Company"),
and Wachovia Bank, N.A., a ___________________ (the "Rights Agent"),
to purchase from the Company at any time after the Distribution Date
(as such term is defined in the Rights Agreement) and prior to 4:00
P.M. (Atlanta, Georgia time) on April 10, 2009 at the office of the
Rights Agent in _______________, one one-hundredth of a fully paid,
nonassessable share of Series A Participating Preferred Stock (the
"Preferred Stock") of the Company, at a purchase price of $100.00 per
one one-hundredth of a share (the "Purchase Price"), upon
presentation and surrender of this Rights Certificate with the
appropriate Form of Election to Purchase duly executed. The number of
Rights evidenced by this Rights Certificate set forth above (and the
number of shares which may be purchased upon exercise thereof) and
the Purchase Price set forth above are the number and Purchase Price
as of April 10, 1999 based on the Preferred Stock as constituted at
such date.
As provided in the Rights Agreement, the Purchase Price and
the number of shares of Preferred Stock or other securities which may
be purchased upon the exercise of
-----------------
1/ The portion of the legend in brackets shall be inserted only if applicable.
A-1
43
the Rights evidenced by this Rights Certificate are subject to
modification and adjustment upon the happening of certain events.
This Rights Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement, which terms,
provisions and conditions are hereby incorporated herein by reference
and made a part hereof and to which Rights Agreement reference is
hereby made for a full description of the rights, limitations of
rights, obligations, duties and immunities hereunder of the Rights
Agent, the Company and the holders of the Rights Certificates. Copies
of the Rights Agreement are on file at the principal office of the
Company and are also available upon written request to the Company.
This Rights Certificate, with or without other Rights
Certificates, upon surrender at the office of the Rights Agent
designated for such purpose, may be exchanged for another Rights
Certificate or Rights Certificates of like tenor and date evidencing
Rights entitling the holder to purchase a like aggregate number of
shares of Preferred Stock as the Rights evidenced by the Rights
Certificate or Rights Certificates surrendered shall have entitled
such holder to purchase. If this Rights Certificate shall be exercised
(other than pursuant to Section 11(a)(ii) of the Rights Agreement) in
part, the holder shall be entitled to receive upon surrender hereof
another Rights Certificate or Rights Certificates for the number of
whole Rights not exercised. If this Rights Certificate shall be
exercised in whole or in part pursuant to Section 11(a)(ii) of the
Rights Agreement, the holder shall be entitled to receive this Rights
Certificate duly marked to indicate that such exercise has occurred as
set forth in the Rights Agreement.
Subject to the provisions of the Rights Agreement, the
Company, at its option, may exchange the Rights evidenced by this
Rights Certificate for shares of Common Stock of the Company at an
exchange ratio of one share of Common Stock per Right, subject to
adjustment.
Subject to the provisions of the Rights Agreement, the Rights
evidenced by this Rights Certificate may be redeemed by the Company at
its option at a redemption price of $.01 per Right. Subject to the
provisions of the Rights Agreement, the Company, at its option, may
elect to mail payment of the redemption price to the registered holder
of the Right at the time of redemption, in which event this Rights
Certificate may become null and void without any further action by the
Company.
No fractional shares of Preferred Stock will be issued upon
the exercise of any Right or Rights evidenced hereby (other than
fractions which are integral multiples of one one-hundredth of a share
of Preferred Stock which may, at the election of the Company, be
evidenced by depositary receipts), but in lieu thereof a cash payment
will be made as provided in the Rights Agreement.
No holder of this Rights Certificate, as such, shall be
entitled to vote or receive dividends or be deemed for any purpose the
holder of shares of Preferred Stock or of any other securities of the
Company which may at any time be issuable on the exercise hereof, nor
shall anything contained in the Rights Agreement or herein be
construed to
A-2
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confer upon the holder hereof, as such, any of the rights of a
stockholder of the Company or any right to vote for the election of
directors or upon any matter submitted to stockholders at any meeting
thereof, or to give or withhold consent to any corporate action, or to
receive notice of meetings or other actions affecting stockholders
(except as provided in the Rights Agreement), or to receive dividends
or subscription rights, or otherwise, until the Right or Rights
evidenced by this Rights Certificate shall have been exercised as
provided in the Rights Agreement.
This Rights Certificate shall not be valid or obligatory for
any purpose until it shall have been manually countersigned by the
Rights Agent.
A-3
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WITNESS the facsimile signatures of the proper officers of the
Company, dated as of ___________________, ___.
ATTEST: XXXX INDUSTRIES, INC.
By:
------------------------------- -----------------------------
Name: Name:
Title: Title:
COUNTERSIGNED:
-------------------------------
Authorized Signature
of Rights Agent
A-4
46
[Form of Reverse Side of or Attachment to Rights Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Rights Certificate)
FOR VALUE RECEIVED ________________________________(Registered Holder)
hereby sells assigns and transfers unto
______________________________________________________________________
(Name of Transferee) whose address is:
______________________________________________________________________
the Rights evidenced by this Rights Certificate, together with all
right, title and interest therein, and does hereby irrevocably
constitute and appoint
________________________________________ Attorney-in-Fact, to transfer
the within Rights Certificate on the books of the within-named
Company, with full power of substitution.
Dated: ___________________________ , ___
--------------------------------------
Signature of Registered Holder
Signature Guaranteed:
---------------------------
(signatures must be guaranteed by a commercial bank or trust company
having an office or correspondent in the United States)
A-5
47
Certificate to Assignment
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) the Rights evidenced by the Rights Certificate
[ __ ] are [ __ ] are not being sold, assigned and transferred by or on behalf
of a Person who is or was an Acquiring Person or an Affiliate or Associate of
any such Acquiring Person (as such terms are defined in the Rights Agreement);
and
(2) after due inquiry and to the best knowledge of the
undersigned, the undersigned [ _____ ] did [ _____ ] did not acquire the Rights
evidenced by the Rights Certificate from any Person who is, was or subsequently
became an Acquiring Person or an Affiliate or Associate of an Acquiring Person.
Dated: ,
----------------------- --- -------------------------------------
Signature
NOTICE
THE SIGNATURE TO THE FOREGOING ASSIGNMENT MUST CORRESPOND TO THE NAME
AS WRITTEN UPON THE FACE OF THE RIGHTS CERTIFICATE IN EVERY PARTICULAR, WITHOUT
ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER.
A-6
48
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise the
Rights Certificate pursuant to Section 11(a)(ii) of
the Rights Agreement)
To XXXX INDUSTRIES, INC.:
The undersigned hereby irrevocably elects to exercise
____________________ Rights represented by the Rights Certificate to purchase
the shares of Common Stock (or such other securities of the Company) issuable
upon the exercise of the Rights and requests that certificates for such shares
be issued in the name of:
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
(Please print name and address)
-------------------------------------------------------------------------------
(Please insert social security or other identifying number)
The Rights Certificate indicating the balance, if any, of such Rights
which may still be exercised pursuant to Section 11(a)(ii) of the Rights
Agreement shall be returned to the undersigned unless such person requests that
the Rights Certificate be registered in the name of and delivered to:
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
(Please print name and address - complete only
if Rights Certificate is to be registered in
a name other than the undersigned)
-------------------------------------------------------------------------------
(Please insert social security or other identifying number)
Dated: ,
----------------------------- --- ----------------------------------
Signature
Signature Guaranteed:
---------------------------------
(signatures must be guaranteed by a commercial bank or trust company having an
office or correspondent in the United States)
A-7
49
Certificate to Election to Purchase
(pursuant to Section 11(a)(ii) of the Rights Agreement)
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) the Rights evidenced by the Rights Certificate
[ __ ] are [ __ ] are not being exercised by or on behalf of a Person who is or
was an Acquiring Person or an Affiliate or Associate of any such Acquiring
Person (as such terms are defined in the Rights Agreement);
(2) the Rights Certificate [ __ ] is [ __ ] is not being
sold, assigned and transferred by or on behalf of a Person who is or was an
Acquiring Person or an Affiliate or Associate of any such Acquiring Person; and
(3) after due inquiry and to the best knowledge of the
undersigned, the undersigned [ __ ] did [ __ ] did not acquire the Rights
evidenced by the Rights Certificate from any Person who is, was or subsequently
became an Acquiring Person or an Affiliate or Associate of an Acquiring Person.
Dated: ,
------------------ ---- ----------------------------------
Signature
NOTICE
THE SIGNATURE TO THE FOREGOING ELECTION TO PURCHASE MUST CORRESPOND TO
THE NAME AS WRITTEN UPON THE FACE OF THE RIGHTS CERTIFICATE IN EVERY
PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER.
A-8
50
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to
exercise the Rights Certificate other than pursuant to
Section 11(a)(ii) of the Rights Agreement)
To XXXX INDUSTRIES, INC.:
The undersigned hereby irrevocably elects to exercise
____________________ Rights represented by the Rights Certificate to purchase
the shares of Preferred Stock (or such other securities of the Company or any
other Person) issuable upon the exercise of the Rights and requests that
certificates for such shares be issued in the name of:
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
(Please print name and address)
-------------------------------------------------------------------------------
(Please insert social security or other identifying number)
The Rights Certificate indicating the balance, if any, of such Rights
which may still be exercised pursuant to Section 11(a)(ii) of the Rights
Agreement shall be returned to the undersigned unless such person requests that
the Rights Certificate be registered in the name of and delivered to:
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
(Please print name and address - complete only
if Rights Certificate is to be registered in
a name other than the undersigned)
-------------------------------------------------------------------------------
(Please insert social security or other identifying number)
Dated: ,
----------------------------- --- ----------------------------------
Signature
Signature Guaranteed:
---------------------------------
(signatures must be guaranteed by a commercial bank or trust company having an
office or correspondent in the United States)
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51
Certificate to Election to Purchase
(other than pursuant to Section 11(a)(ii)
of the Rights Agreement)
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) the Rights evidenced by the Rights Certificate
[ __ ] are [ __ ] are not being sold, assigned and transferred by or on behalf
of a Person who is or was an Acquiring Person or an Affiliate or Associate of
any such Acquiring Person (as such terms are defined in the Rights Agreement);
and
(2) after due inquiry and to the best knowledge of the
undersigned, the undersigned [ __ ] did [ __ ] did not acquire the Rights
evidenced by the Rights Certificate from any Person who is, was or subsequently
became an Acquiring Person or an Affiliate or Associate of an Acquiring Person.
Dated: ,
-------------------- --- ------------------------------------
Signature
NOTICE
THE SIGNATURE TO THE FOREGOING ELECTION TO PURCHASE MUST CORRESPOND TO
THE NAME AS WRITTEN UPON THE FACE OF THE RIGHTS CERTIFICATE IN EVERY
PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER.
X-00
00
X-0
EXHIBIT B
SUMMARY OF RIGHTS
On March 29, 1989, the Board of Directors of Xxxx Industries, Inc. (the
"Company") declared a dividend distribution of one Right for each outstanding
share of common stock, no par value (the "Common Stock"), of the Company to
stockholders of record at the close of business on April 10, 1989 (the "Record
Date"). The Board of Directors of the Company has approved and adopted certain
amendments to the terms of the Rights and the Rights Agreement under which the
Rights had been issued. The description and terms of the Rights, as currently in
effect, are set forth in the Amended and Restated Rights Agreement (the "Rights
Agreement") dated as of April 10, 1999 between the Company and Wachovia Bank,
N.A., as Rights Agent.
Except as set forth below, each Right, when exercisable, entitles the
registered holder to purchase from the Company one one-hundredth of a share of
convertible preferred stock, designated as Series A Participating Preferred
Stock, $1.00 stated value per share (the "Preferred Stock"), of the Company at
a price of $100.00 (the "Purchase Price"), subject to adjustment. The Rights are
attached to all certificates representing shares of Common Stock outstanding
and no separate Rights certificates have been distributed. Until the earlier to
occur of (i) the close of business on the tenth business day after a public
announcement that, without the prior consent of the Company, a person or group
of affiliated or associated persons (an "Acquiring Person") has acquired, or
obtained the right to acquire, beneficial ownership of securities representing
15% or more of the outstanding shares of Common Stock of the Company or (ii)
the close of business on the tenth business day after (unless such date is
extended by the Board of Directors) the date of the commencement of (or a
public announcement of an intention to make) a tender offer or exchange offer
which would result in any person or group and related persons becoming an
Acquiring Person, without the prior consent of the Company (the earlier of such
dates being called the "Distribution Date"), the Rights will be evidenced, with
respect to any of the Common Stock certificates outstanding, by such Common
Stock certificates together with this Summary of Rights. The Rights Agreement
provides that, until the Distribution Date, the Rights will be transferred with
and only with Common Stock certificates. Until the Distribution Date (or
earlier redemption or expiration of the Rights), new Common Stock certificates
issued upon transfer or new issuance of shares of Common Stock will contain a
notation incorporating the Rights Agreement by reference. Until the
Distribution Date (or earlier redemption or expiration of the Rights), the
surrender for transfer of any certificates for Common Stock (with or without
this Summary of Rights attached) will also constitute the transfer of the
Rights associated with the Common Stock represented by such certificates. As
soon as practicable following the Distribution Date, separate certificates
evidencing the Rights ("Rights Certificates") will be mailed to holders of
record of the Common Stock as of the
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53
close of business on the Distribution Date, and the separate Rights
Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date. The Rights
will expire on the earliest of (i) April 10, 2009, (ii) consummation of a
merger transaction with a person who or group that acquired Common Stock
pursuant to a Permitted Offer (as defined below), and who or that is offering
in the merger the same price per share and form of consideration paid in the
Permitted Offer, (iii) consummation of an exchange of all of the exercisable
Rights for shares of Common Stock, or (iv) redemption by the Company as
described below.
The Purchase Price payable and the number of shares of Preferred Stock
or other securities or property issuable upon exercise of the Rights are
subject to adjustment from time to time to prevent dilution (i) in the event of
a stock dividend on, or a subdivision, combination or reclassification of, the
Preferred Stock, (ii) upon the grant to holders of the Preferred Stock of
certain rights or warrants to subscribe for Preferred Stock, certain
convertible securities or securities having the same or more favorable rights,
privileges and preferences as the Preferred Stock at less than the current
market price of the Preferred Stock or (iii) upon the distribution to holders
of the Preferred Stock of evidences of indebtedness or assets (excluding
regular quarterly cash dividends out of earnings or retained earnings) or of
subscription rights or warrants (other than those referred to in clause (ii)
above).
In the event that, after the first date of public announcement by the
Company or an Acquiring Person that an Acquiring Person has become such, the
Company is involved in a merger or other business combination transaction in
which the Common Stock is exchanged or changed, or 50% or more of the Company's
assets or earning power is sold (in one transaction or a series of
transactions), proper provision shall be made so that each holder of a Right
(other than such Acquiring Person) shall thereafter have the right to receive,
upon the exercise thereof at the then current exercise price of the Right, that
number of shares of common stock of the acquiring company (or, in the event
there is more than one acquiring company, the acquiring company receiving the
greatest portion of the assets or earning power transferred) which at the time
of such transaction would have a market value of two times the exercise price
of the Right (such right being called the "Merger Right"). In the event that a
person becomes the beneficial owner of securities representing 15% or more of
the outstanding shares of Common Stock of the Company (unless pursuant to a
tender offer or exchange offer for all outstanding shares of Common Stock at a
price and on terms determined by at least a majority of the members of the
Board of Directors who are not officers of the Company to be both adequate and
otherwise in the best interests of the Company and its stockholders (a
"Permitted Offer")), proper provision shall be made so that each holder of a
Right (other than any Acquiring Person) will for a 60-day period thereafter
have the right to receive, upon exercise, that number of shares of Common Stock
having a market value of two times the exercise price of the Right, or, if the
Company does not have sufficient treasury shares and authorized but unissued
Common Stock, shares of Common Stock, to the extent available, and then (after
all treasury and authorized and unreserved shares of
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54
Common Stock have been issued) cash, reduction of the Purchase Price, common
stock equivalents (such as Preferred Stock or another equity security with at
least the same economic value as the Common Stock), debt securities or other
assets having an aggregate value of two times the exercise price of the Right
(such right being called the "Subscription Right"). The holder of a Right will
continue to have the Merger Right whether or not such holder exercises the
Subscription Right. Upon the occurrence of any of the events giving rise to the
exercisability of the Merger Right or the Subscription Right, any Rights that
are or were at any time owned by an Acquiring Person engaging in any of such
transactions or receiving the benefits thereof on or after the time the
Acquiring Person becomes such shall become void insofar as they relate to the
Merger Right or the Subscription Right.
At any time after any person becomes an Acquiring Person but prior to
the acquisition by any person of 50% or more of the outstanding shares of
Common Stock, the Company may exchange the Rights (other than any Rights held
by the Acquiring Person) for shares of Common Stock at an exchange ratio of one
share of Common Stock per Right, subject to adjustment.
With certain exceptions, no adjustments in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in
such Purchase Price. No fractions of shares will be issued and, in lieu
thereof, an adjustment in cash will be made based on the market price of the
Common Stock on the last trading date prior to the date of exercise.
At any time prior to the earlier to occur of (i) close of business in
the tenth business day after a person becoming an Acquiring Person or (ii) the
expiration of the Rights, the Company may redeem the Rights in whole, but not
in part, at a price of $.01 per Right (the "Redemption Price"), which
redemption shall be effective upon the action of the Board of Directors.
Additionally, the Company may thereafter redeem the then outstanding Rights in
whole, but not in part, at the Redemption Price, provided that such redemption
is incidental to a merger or other business combination transaction or series
of transactions involving the Company but not involving an Acquiring Person or
any person who was an Acquiring Person or following an event giving rise to,
and the expiration of the exercise period for, the Subscription Right if and
for as long as an Acquiring Person beneficially owns securities representing
less than 15% of the voting power of the Company's voting securities. The
redemption of Rights described in the preceding sentence shall be effective
only as of such time when the Subscription Right is not exercisable, and in any
event, only after ten business days, prior notice. Upon the effective date of
the redemption of the Rights, the right to exercise the Rights will terminate
and the only right of the holders of Rights will be to receive the Redemption
Price.
The Preferred Stock purchasable upon exercise of the Rights will be
nonredeemable and junior to any other series of preferred stock the Company may
issue (unless otherwise provided in the terms of such other series of preferred
stock). Each share of Preferred Stock will have a preferential quarterly
dividend in an amount equal to
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55
100 times the dividend declared on each share of Common Stock, but in no event
less than $1.00. In the event of liquidation, the holders of Preferred Stock
will receive a preferred liquidation payment equal to the greater of 100 times
the Purchase Price or 100 times the payment made per each share of Common
Stock. Subject to certain adjustments to reflect an increase or decrease in the
number of outstanding shares of Common Stock, each one one-hundredth of a share
of Preferred Stock shall, for a period of 90 days after issuance, be
convertible into one share of Common Stock.
Each share of Preferred Stock will have 100 votes, voting together
with the shares of Common Stock. With regard to any election for the Company's
Board of Directors, however, the maximum number of votes for the election of
directors exercised by holders of shares of preferred stock (including the
Preferred Stock) shall not exceed the number of votes for the election of
directors represented by authorized and issued shares of Common Stock less one,
and the number of votes for the election of directors exercised by holders of
shares of preferred stock (including the Preferred Stock) shall be reduced as
necessary on a pro rata basis to effectuate this result. If the Company fails
to pay dividends on the Preferred Stock for a specified period (a "default
period"), the holders of Preferred Stock shall have the additional right to
elect a number of directors equal to two-thirds of the existing members of the
Board of Directors, rounded down, until such default period expires. The total
number of directors constituting the Board of Directors shall be increased
accordingly for only so long as the default period continues.
In the event of any merger, consolidation or other transaction in
which shares of Common Stock are exchanged, each share of Preferred Stock will
be entitled to receive 100 times the amount and type of consideration received
per share of Common Stock. The rights of the Preferred Stock as to dividends,
liquidation and voting, and in the event of mergers and consolidations, are
protected by customary anti-dilution provisions. Fractional shares of Preferred
Stock will be issuable; however, the Company may elect to distribute depositary
receipts in lieu of such fractional shares. In lieu of fractional shares other
than fractions that are multiples of one one-hundredth of a share, an
adjustment in cash will be made based on the market price of the Preferred
Stock on the last trading date prior to the date of exercise.
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
Rights Agent. This summary description of the Rights does not purport to be
complete and is qualified in its entirety by reference to the Rights Agreement,
which is incorporated herein by reference.
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